MSCI (MSCI) Misses Q2 EPS by 1c, Beats on Revenues

MSCI (NYSE: MSCI) reported Q2 EPS of $0.89, $0.01 worse than the analyst estimate of $0.90. Revenue for the quarter came in at $316.1 million versus the consensus estimate of $313.41 million.

MSCI’s guidance for full-year 2017 is as follows:

• Total operating expenses are now expected to be in the range of $690 million to $700 million and adjusted EBITDA expenses are now expected to be in the range of $605 million to $615 million, down from the previous ranges of $690 million to $705 million and $605 million to $620 million, respectively.
• Interest expense, including the amortization of financing fees, is expected to be approximately $116 million, assuming no additional financings.
• Capex is expected to be in the range of $40 million to $50 million.
• Net cash provided by operating activities and free cash flow is expected to be in the range of $360 million to $410 million and $310 million to $370 million, respectively.
• The effective tax rate is now expected to be in the range of 30.0% to 31.0%, down from previous range of 31.5% to 32.5%.

Financial and Operational Highlights for Second Quarter 2017(Note: Percentage and other changes refer to second quarter 2016 unless otherwise noted.)

• 8.8% increase in operating revenues to $316.1 million, up 9.4% adjusting for the impact of foreign currency exchange rate fluctuations.
• 16.5% increase in Index revenues driven by a growth of 35.5% in asset-based fees and an 8.8% increase in recurring subscription revenues.
• Record quarter-end AUM of $624.3 billion in ETFs linked to MSCI indexes; increase of 42.0% and 12.3% compared to second quarter 2016 and first quarter 2017, respectively.
• Total Aggregate Retention Rate at 94.9% and Index Aggregate Retention Rate at 97.0%.
• 12.6% increase in total Run Rate to $1,260.4 million driven by a 38.0% increase in asset-based fees Run Rate, and a 7.3% increase in subscription Run Rate.
• In second quarter 2017 and through July 28, 2017, a total of 461 thousand shares were repurchased at an average price of $100.63 per share for a total value of $46.4 million. A total of $734.9 million remains on the outstanding share repurchase authorization.
• Board of Directors authorize 35.7% increase in regular quarterly cash dividend to $0.38 per share, or $1.52 per share on an annualized basis.

For earnings history and earnings-related data on MSCI (MSCI) click here.

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