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Experian grows in Latin America

The Latin American business grew despite challenging conditions
May 22, 2017

Tightening of credit standards in the US slowed the growth of Experian 's (EXPN) US business in the final quarter of its 2017 financial year, going against the prevailing trend. Overall, revenue in the North American business was up 7 per cent, most of which was generated organically. The standout performer, however, was the group's Latin American business, which saw organic revenue growth of 9 per cent for the year. The group's performance in Brazil was driven by expansion within major banks, new services offered to small- and medium-sized businesses and counter-cyclical products such as delinquency notifications.

IC TIP: Hold at 1643p

Following the agreed sale of 75 per cent of the email and cross-channel marketing business, which is expected to complete in the current financial year, the group is looking to focus on launching new products. It has increased investment in data sources, advanced analytics and "decisioning" software used to aid risk and fraud prevention analysis. The group has also extended its share repurchase programme, with plans to buy a maximum of 50m shares for $600m (£462m) over the year to March 2018.

Analysts at Stifel are forecasting adjusted pre-tax profit of $1.25bn for the year to March 2018, giving adjusted EPS of 99.5¢, against $1.13bn and 87.7¢ in 2017.

EXPERIAN (EXPN)

ORD PRICE:1,643pMARKET VALUE:£15.5bn
TOUCH:1,642-1,644p12-MONTH HIGH:1,708pLOW: 1,227p
DIVIDEND YIELD:1.9%PE RATIO:25
NET ASSET VALUE:280¢*NET DEBT:120%

Year to 31 MarTurnover ($bn)Pre-tax profit ($bn)Earnings per share (¢)Dividend per share (¢)
20134.700.4036.634.8
20144.841.0576.837.5
20154.811.0176.939.3
2016 (restated)4.240.9778.640.0
20174.341.0792.141.5
% change+2+11+15+4

Ex-div: 22 Jun

Payment: 21 Jul

*Includes intangible assets of $5.71bn, or 605¢ a share, £1=$1.304