Solid first half from Experian

Shares in credit-checking giant Experian (EXPN) closed in on record highs after the group reported double-digit revenue growth, including organic growth of 8 per cent. Reported pre-tax profits were hit by a $403m (£252m) movement in financial derivatives, but strip this out and underlying pre-tax profits rose 6 per cent to $563m.

Mature western markets may be slowing slightly, but a focus on emerging markets and new products is still delivering results for the market leader in creditworthiness checking. The fastest growing market remains Latin America, which reported a 17 per cent rise in organic sales to $499m. In the core North American market, accounting for almost half of group turnover, underlying sales increased by 7 per cent to $1.1bn as lending conditions improved and demand for fraud and identity checks grew rapidly. In the UK and Ireland, where consumer credit markets remain tight, sales growth was a more anaemic 3 per cent.

Experian is not immune to the uncertain market conditions and announced an efficiency programme to protect margins, which will cost $110m over the next couple of years to implement and deliver savings of $75m a year by 2015. Analysts at Seymour Pierce expect to downgrade forecasts slightly to reflect currency movements and anticipate full-year adjusted pre-tax profits of $1.25bn and EPS of 88.9¢ (from $1.19bn and 78.9¢ for 2012).

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