Second-Quarter 2008 Revenue Grew 9.5% and Income from Operations Increased 13.6%; Company Raises 2008 Outlook for Revenue and Income from Operations
Interactive Data Corporation reports its financial results for the second quarter ended 30 June 2008. Interactive Data’s second-quarter 2008 revenue increased 9.5% to $186.1 million from $170.0 million in the second quarter of 2007. Net income for the second quarter of 2008 was $33.5 million, or $0.35 per diluted share, a 15.1% increase over net income of $29.1 million, or $0.30 per diluted share, in the second quarter of 2007.
“We are pleased with Interactive Data’s second-quarter 2008 results, particularly in light of the turbulent market conditions,” says Stuart Clark, president and chief executive officer. “Our strong second-quarter 2008 revenue growth of 9.5%, combined with disciplined spending, produced a 13.6% increase in income from operations and 15.1% net income growth. In addition, we enjoyed another quarter of significant cash generation. Organic revenue growth of 7.7% during the second quarter of 2008 reflects an outstanding performance at our Pricing and Reference Data business as well as continued momentum with our real-time datafeeds business.
“During the second quarter of 2008, new sales activity was robust and renewal rates across our institutional businesses remained at approximately 95%. We believe that our success in the marketplace and strong standing with our customers reflects the mission-critical nature of our core products and services, and our ability to help them address important trends that are affecting their businesses. An important highlight during the quarter was our agreement to acquire Kler’s Financial Data Service, a leading provider of reference data to the Italian financial industry. This acquisition will enable us to increase our presence in Italy and further expand the breadth and depth of valuable reference data that we collect and deliver to our clients worldwide.”
“We ended the second quarter with $254.8 million in cash, cash equivalents and marketable securities and no debt,” says Andrew Hajducky, Interactive Data’s executive vice president and chief financial officer.”Upcoming uses of cash include funding our recently approved regular quarterly dividend and the acquisition of Kler’s, which we anticipate will close within the next several weeks. With another good quarter of cash generation behind us and an array of exciting growth opportunities in front of us, we also plan to modestly accelerate our capital spending during the second half of 2008 against our original plan as we further fortify our technical infrastructure.”
“We have continued to implement key elements of our growth strategy aimed at delivering high-value services and expanding our business internationally,” says Clark. “As a result of our recent acquisitions, strategic alliances and internal development activities, we are delivering compelling new services, adding innovative capabilities to our existing offerings, broadening our market coverage and scaling our infrastructure. We move forward well positioned to continue expanding our business with customers worldwide, and are on pace to deliver another year of solid financial results.”
Interactive Data’s second-quarter 2008 revenue was positively impacted by $2.3 million due to the effects of foreign exchange. Second-quarter 2008 revenue before the effects of foreign exchange grew by $13.9 million, or 8.2%, over the comparable period in 2007. Total costs and expenses in the second quarter of 2008 were negatively impacted by $2.4 million due to the effects of foreign exchange. Second-quarter 2008 total costs and expenses before the effects of foreign exchange increased by $7.8 million, or 6.2%, over the second quarter of 2007.
As of 30 June 2008, Interactive Data had no outstanding debt and had cash, cash equivalents and marketable securities of $254.8 million. During the second quarter of 2008, Interactive Data spent $14.2 million to repurchase 512,000 shares of common stock at an average purchase price of $27.74 per share as part of its existing stock buyback program. Entering the third quarter of 2008, more than 1.8 million shares remained available for repurchase under the existing stock buyback program. During the second quarter of 2008, Interactive Data paid $14.1 million to stockholders in connection with its regular quarterly dividend of $0.15 per share to stockholders.
On 16 July 2008, Interactive Data announced that its Board of Directors declared a quarterly cash dividend of $0.15 per share of Interactive Data common stock payable on 26 September 2008 to stockholders of record on 5 September 2008.