On June 23 before the market opened, IHS Markit Ltd. (INFO, Financial) released its results for its fiscal second quarter of 2020, which ended May 31. The financial information services provider surpassed earnings projections, but missed out on revenue.
Snapshot of the quarter
The London-based company posted adjusted earnings of 69 cents per share in the second-quarter, down from 71 cents in the year-ago quarter. Analysts called for earnings per share of 65 cents.
Revenue of $1.03 billion was down from the $1.14 billion recorded in the prior-year quarter and missed projections by 2.07%. Growth in the financial services and consolidated markets and solutions segments was negated by poor performance of the transportation and resources segments.
Reflecting on the quarter, the company’s Chairman and CEO Lance Uggla said:
“Q2 was a challenging quarter due to the COVID-19 pandemic, but I am very pleased with how the organization responded and how we are positioned to deliver strong results in 2020 and beyond.”
Segment performance
In the Financial Services sector, revenue rose 2% in the second quarter to $444 million. That includes 3% organic growth. Quarterly adjusted Ebitda for the segment stood at $231 million, which reflected a 13% growth over the past year.
The Transportation division saw revenue decline of 24% to $243 million, which includes an 18% organic decline. Adjusted Ebitda came in at $102 million, which decreased $35 million from the prior-year quarter.
Revenue of $219 million plunged 12% on a year-over-year basis to $219 million for the Resources segment, inclusive of the total organic revenue decline of 14%. Adjusted Ebitda fell $13 million to $96 million.
In the Consolidated Markets & Solutions division, revenue grew 10% to $121 million, including the total organic revenue growth of 2% in the reported quarter. Quarterly adjusted Ebitda totalled $35 million, up 19% as compared to the same period last year.
Financial forecast
IHS Markit has provided financial guidance for fiscal 2020. The company predicts adjusted Ebitda to fall within the range of $1.825 billion to $1.835 billion. Adjusted EPS is expected to be between $2.76 and $2.78.
Disclosure: I do not hold any positions in the stocks mentioned.
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