Moody's Tops Expectations but Offers Cautious Outlook
July 22 2016 - 7:30AM
Dow Jones News
Moody's Corp. said revenue edged up in the second quarter as
bond issuance recovered, though the ratings firm said heightened
market uncertainty outside of the U.S. would pressure full-year
results.
The New York-based company, the world's second-biggest ratings
firm behind Standard & Poor's, relies on activity in global
credit markets as corporations and lenders pay firms like Moody's
to rate the debt they issue. In April, Chief Executive Raymond
McDaniel said he expected activity to pick up in the second half of
the year after a rocky first half owed to growing fears stemming
from the Chinese economy, turbulent financial markets and concerns
over the sturdiness of the domestic economy.
On Friday, he said profit this year would come in at the low-end
of the downbeat guidance Moody's offered in April, which pegged
per-share earnings between $4.55 to $4.65 and revenue to grow by a
low single-digit percentage.
Aside from rating debt, the company sells financial data and
other types of market intelligence to investors and banks. In that
segment, sales climbed 8.7% to $303.3 million and offset a 2.1%
decline in the bigger investors service business.
Over all, Moody's posted a profit of $255.5 million, down from
year-earlier earnings of $261.7 million. The company's per-share
earnings, though, rose to $1.32 from $1.28 because of fewer shares
outstanding.
Revenue edged up 1.2% to $928.9 million.
Analysts projected $1.27 in adjusted earnings per share on
$909.1 million in revenue, according to Thomson Reuters.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
(END) Dow Jones Newswires
July 22, 2016 08:15 ET (12:15 GMT)
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