5. 5
Investing in a growing, profitable and cash generative
leader in financial information services
— Leading global provider of financial information services with a scalable and
stable business model
— Trusted partner to a diverse global customer base and deeply embedded in their
systems and workflows
— Solid organic revenue growth, favorable margins, high recurring revenues, and
strong cash flow generation
— Large and rapidly growing addressable market due to increased regulation and
cost pressures in the financial industry
— Strong track record of innovation and well positioned to capitalize on future
growth opportunities
— Strong balance sheet that provides flexibility to accelerate growth through value
enhancing acquisitions
— Management team highly incentivized to execute
Introduction to Markit
6. 6
Leading global provider of financial information services
Enhancing transparency | Reducing risk | Improving operational efficiency
Customers UsersAsset classes
Banks Corporates
Asset managers Insurance companies
Hedge funds Securities firms
PE / VC funds Clearing firms
Pension funds Software / data vendors
Equities FX
Credit Structured finance
Loans Commodities
Rates CDS
Bonds Environmental
Traders Valuation analysts
Risk managers Actuaries
IT professionals Research analysts
Investment professionals Portfolio managers
Introduction to Markit
1 Includes $495m in share repurchases conducted in August 2012 payable in quarterly installments through to May 2017. As of December 31, 2014, outstanding amount of $211.1m. Leverage ratio as
presented is calculated using Markit’s publicly reported definition of Adjusted EBITDA and Net Debt and not the definitions and methodology set forth in its revolving credit facility.
2003
founded
3,500+
institutional
customers
$1.1bn
2014 revenue
$488m
2014 Adjusted
EBITDA
0.65x
2014 Net debt /
Adjusted EBITDA
1
7. 7
Trusted partner to a diverse and global customer base
Introduction to Markit
Other2
Global revenue base Key highlights
FY 2014 revenue: $1.1bn
Broad diverse customer base1
─ 3,500+ institutional customers
─ Renewal rate of approximately
90% for recurring fixed fee contracts
─ Largest customer accounts for
<5% of revenue
─ Well-recognized brand
Diversified global blue-chip customer base
1 Chart figures represent composition of customer base by number of customers.
2 "Other" includes consultants, accountants, NGOs, law firms, individuals, media/press, project developers, trade associations, self-regulatory organizations, and other.
US
50%
European
Union
39%
Other
11%
0%0%0%0%0%0%0%0%
Other 2
Institutional investors
Government and academic
Software / data vendors
Banks
Securities and clearing firms
Corporates and insurance
Hedge fund and private equity / Venture capital
Asset managers
0%0%0%0%0%0%0%0%
Other 2
Institutional investors
Government and academic
Software / data vendors
Banks
Securities and clearing firms
Corporates and insurance
Hedge fund and private equity / Venture capital
Asset managers
0%0%0%0%0%0%0%0%
Other 2
Institutional investors
Government and academic
Software / data vendors
Banks
Securities and clearing firms
Corporates and insurance
Hedge fund and private equity / Venture capital
Asset managers
0%0%0%0%0%0%0%0%
Other 2
Institutional investors
Government and academic
Software / data vendors
Banks
Securities and clearing firms
Corporates and insurance
Hedge fund and private equity / Venture capital
Asset managers
0%0%0%0%0%0%0%0%
Other 2
Institutional investors
Government and academic
Software / data vendors
Banks
Securities and clearing firms
Corporates and insurance
Hedge fund and private equity / Venture capital
Asset managers
0%0%0%0%0%0%0%0%
Other 2
Institutional investors
Government and academic
Software / data vendors
Banks
Securities and clearing firms
Corporates and insurance
Hedge fund and private equity / Venture capital
Asset managers0%0%0%0%0%0%0%0%
Other 2
Institutional investors
Government and academic
Software / data vendors
Banks
Securities and clearing firms
Corporates and insurance
Hedge fund and private equity /
Venture capital
Asset managers
19%
22%
12%
8%
10%
5%
4% 0%
20%
Asset managers
Hedge fund and private
equity / Venture capital
Corporates and insurance
Securities and
clearing firms
Banks
Software / data vendors
Government and academic
Institutional investors
Other 2
8. 8
Leveraging our industry expertise and leading
technologies across three complementary divisions
Critical financial market information
sourced, created, enriched and
delivered
Trade processing solutions for OTC
derivatives, FX and syndicated loans
Advanced enterprise solutions tied to
Markit technology and software
Information
Processing
Solutions
Introduction to Markit
$294m
27.6%
$285m
26.8%
$486m
45.6%
Pricing & reference data
Indices
Valuation and trading
services
MarkitSERV
Loan settlement
Managed services
Enterprise software
2014 revenue
(m)
2014 adj.
EBITDA margin
Information $486 49.2%
Processing $285 55.0%
Solutions $294 31.7%
Markit $1,065 46.0%
9. 9
Introduction to Markit
Top 10 products comprise ~80% of 2014 revenue
Managed
services
16%
Enterprise
software
12%
Processing
27%
Valuation
and trading
services
18%
Indices
8%
Pricing and
reference
data
19%
Pricing and reference data
─ Fixed income (CDS, Loans, Bonds)
─ Securities lending data
Indices
─ Fixed income indices (iBoxx, iTraxx)
Valuation and trading services
─ Totem
─ Portfolio valuations
OTC derivatives, loans, FX processing
─ OTC derivatives (IRS, CDS, Equity) and FX
─ Syndicated loan settlement
Enterprise software / Managed services
─ WSO software / WSO services
─ On Demand
─ Enterprise Data Management (EDM)
InformationProcessingSolutions
Total 2014 revenue
$1.1bn
10. 10
Acquiring and building businesses that expand the
breadth and depth of our products and services
CDS pricing
CDS
reference
entity
identifiers
Dividend
forecasting
Index
management
Loan pricing
Daily equity &
commodities
data
ABS pricing
Credit event
auctions
OTC
derivatives
buy-side
valuations
Metrics
Research
aggregation
Instant
messaging
Desktop and
data feed
solutions
OTC
derivative
trade
processing
Portfolio
reconciliation
Structured
finance
cashflow
modelling
Loan CDS
indices
& pricing
Bespoke
indices
Document
management
Macro -
economic data
Portfolio
compression
Syndicated
loan portfolio
management
software
Trade
confirmations
Loan mapping
service
Environmental
registry
Evaluated
bond pricing
Credit trade
confirmation
Market share
analysis
Loan
settlement
Valuations
management
Entity
identifiers
Mobile
applications
Broker voting
SmartText
Online
advertising
manager
Liquidity
metrics
Loan
processing
Risk analytics
Quantitative
research
and trading
analytics
FX trade
processing
Commission
management
Loan index
Securities
finance
Enterprise
data
management
Credit factors
Instrument
reference data
ETF data &
analytics
ISDA
amendment
service
RED
acquired
Totem &
DaDD
acquired
LoanX
acquired
Chasen
acquired
Communicator
acquired
MarketXS
acquired
BOAT
acquired
CDS IndexCo
acquired
International
Index
Company
acquired
NTC
Economics
acquired
FCS acquired
SwapsWire
acquired
DTCC
DerivSERV
joint venture
created
TZ1 acquired
ClearPar
acquired
STORM
acquired
Wall Street on
Demand
acquired
QuIC acquired
Logicscope
acquired
QSG acquired
Data
Explorers
acquired
Cadis
acquired
26 94 140 313 470 1,081 1,439 2,041 2,414 2,849 3,278
CLO pricing
RMBS index
Tri-Party repo
data
Corporate
actions
Private equity
valuations
Loan analytics
Credit
checking
Tax document
management
Collaboration
services
50% of
MarkitSERV
acquired
GCA acquired
Credit indices
European
ABS
performance
monitoring
European
equity trade
reporting
platform
Quote
parsing
Operational
benchmarking
2004
2005
2006
2008
2009
2011
2012
2013
2007
2010
2003
Investment
management
solutions
Social media
research
signals
Flash Japan
manufacturing
PMI
Client
onboarding
Intraday
iNAVs
Tax
compliance
services
RMB bond
index
2014
thinkFolio
acquired
Majority stake
in CTI
acquired
3,616
Employees
Introduction to Markit
AcquisitionsProducts
Securities
processing
Loan trade
closing
FX broker
affirmations
FX option
confirmations
Prime
brokerage
software
Loan
custodian
services
FX pre-trade
processing
4,000+
2015
Agreed to
acquire
Halifax House
Price Index
Information
Mosaic
acquired
Agreed to
acquire
CoreOne
Technologies
DealHub
acquired
11. 11
Accretive acquisitions to drive growth
Introduction to Markit
─ Positions Markit as a leading
provider of end to end
securities processing solutions
─ Strong synergies with Markit
Corporate Actions allows us to
support the full corporate
actions trade lifecycle
─ Helps customers improve
operational efficiency through
automation
─ Closed July 1st and will be
integrated into Solutions
division
─ A leading provider of index
management, data management,
regulatory reporting and prime
brokerage services to financial
institutions
─ Will benefit from our global sales
relationships and distribution
capabilities
─ Further strengthens Markit executive
team
─ To be integrated across Information
and Solutions divisions
─ Timing subject to customary closing
conditions
─ Provides trading solutions, post-trade
processing and transaction lifecycle
support for the $5 trillion FX market
─ Complementary to Markit’s offerings
and positions us to deliver a more
comprehensive set of solutions to our
combined set of customers
─ DealHub will benefit from the scale
provided by Markit’s global sales and
customer service capabilities and from
synergies with Markit’s multi asset
class trade processing services
─ Closed September 4th and will be
integrated into Processing division
12. 12
Secular trends offer long term growth opportunities
Introduction to Markit
Markit is addressing the most critical areas in a large market that is undergoing
unprecedented change
Growing markets…
Focus on efficiency in financial services
Emerging markets and developing economy growth
Shifting investment styles
Changing regulatory landscape
Evolving technology and communication
Financial data
Order management systems
Data management
Risk management
Reporting and compliance
Indices
…driven by key industry trends
14. 14
Overview of Information division
— Provides pricing and reference data, indices and valuation
and trading services across multiple asset classes
and geographies
— Products used for independent valuations, research, trading,
and liquidity and risk assessments
— Serves over 2,700 customers including buyside firms, sellside
firms, exchanges, central banks, regulators, government
agencies, rating agencies, research organizations, accounting
firms, consultancies, technology and service providers, and
other companies using both direct and third-party
distribution channels
— Predominantly recurring fixed fee, subscription
based revenue
— Principal competitors are Bloomberg L.P., FactSet, Interactive
Data Corporation and Thomson Reuters Inc.
Pricing and
reference data
CDS, Loans, Bonds
Securities lending data
Indices
Cash Bond Indices (iBoxx)
Credit Derivative Indices (iTraxx)
Securitized Product Indices
Economic Indices (PMI)
Custom Indices
Valuation and trading services
Totem
Portfolio valuations
Investment services
Research and OTC services
Information division
113k
CDS
instruments
priced daily
2.3m
Bonds priced daily
$15.5tn
Lendable inventory in
securities finance
dataset
85% of global GDP
Covered by PMI
surveys
$81bn
AuM in ETFs
15. 15
Information division financial performance
Information division
431.3
459.6
486.5
214.5 217.2
239.2
0
100
200
300
400
500
600
2012 2013 2014
Revenue Adjusted EBITDA
49.7% 47.3% 49.2%
40%
41%
19% Valuation and
trading services
Pricing and
reference data
Indices
Adjusted
EBITDA
margin
Revenue ($m)
Subsegments FY 2012 FY 2013 FY 2014
CAGR %
FY2012 – 2014
Pricing and reference data 159.0 182.8 199.8 12.1%
Indices 80.3 86.6 91.5 6.7%
Valuation and trading services 192.0 190.2 195.2 0.8%
Information 431.3 459.6 486.5 6.2%
FY 2014 revenue: $486.5m
Subsegment revenue split Financial performance
($ million)
16. 16
Overview of Processing division
— Offers trade processing solutions globally for OTC
derivatives, FX and syndicated loans
— Enables interdealer brokers, buyside and sellside firms
to confirm transactions rapidly and increase efficiency by
optimizing post-trade workflow
— Reduces operational risk, facilitates compliance with
global reporting regulations and supports clearing
connectivity to 16 OTC clearinghouses
— Predominantly recurring variable-fee revenue model
— Principal competitors are Bloomberg L.P., Intercontinental
Exchange, Inc. and Traiana, Inc.
MarkitServ Loan Settlement
Rates
Credit
Equities
FX
US Syndicated Loans
European Syndicated Loans
Processing division
2,000
customers
90,000
Derivative
transactions
processed daily
16
Clearinghouse
connections
14
Swap execution
facilities (“SEF”)
connections
238.8
265.3
284.9
124.5
138.1
156.6
0
50
100
150
200
250
300
2012 2013 2014
Revenue Adjusted EBITDA
Financial performance
($ million)
52.1% 52.1% 55.0%Adjusted
EBITDA
margin
17. 17
Overview of Solutions division
Solutions division
8,000
Counterparty
Manager
buyside
subscribers
$264bn
WSO Services
AUM
2m
Corporate actions
securities
2.1bn
On Demand webpage
views served weekly
105
WSO Software
customers
Enterprise Software
Enterprise Data Management (EDM)
WSO Software
Analytics
thinkFolio
Information Mosaic
Managed Services
On Demand
WSO Services
Counterparty Manager
Corporate Actions
Tax Solutions
kyc.com
— Provides configurable enterprise software platforms and end-
to-end managed services; designs, builds and hosts mobile
and web applications for financial services customers
— Offerings capture, organize, process, display and analyze
information, manage risk and meet our customers’ regulatory
requirements
— Broad customer base including buyside and sellside firms,
custodians, private equity firms, wealth management firms
and retail brokerages
— Combination of recurring fixed and variable-fee revenue
model, with non-recurring revenue from software sales and
associated services
— Compete with firms such as Clarient Global LLC,
GoldenSource, IBM Algorithmics and Intralinks Holdings, Inc.
24. 24
Management actions to deliver EPS1 growth
Management actions in 2015:
─ Share buyback of $350m as part of secondary
offering
─ Agreed to acquire Halifax House Price Index
─ Acquisition of Information Mosaic
─ Announced acquisition of CoreOneTechnologies2
─ Expected execution of remaining $150m share
buyback authorisation3
─ Expected terming out of debt structure3
~10%
2016 Adjusted Diluted
EPS
2016 Adjusted Diluted
EPS (inclusive of
management actions)
Additional Adjusted
Diluted EPS growth
expected from
management actions4
1. Adjusted diluted earnings per share
2. Subject to regulatory approval and closing conditions
3. Subject to conditions at the time
4. Net impact of all management action through 2015
Q2 2015 results review
25. 25
Q2 2015 results review
Net debt / leverage
($ million)
June
30th, 2015
December
31st, 2014
Bank borrowings 371.9 224.5
Share buyback 170.2 211.1
Total borrowings 542.1 435.6
Cash and cash equivalents (119.5) (117.7)
Net debt 422.6 317.9
LTM Adjusted EBITDA(1) 493.1 488.2
Leverage (2)
H2 2015 management actions
0.86x 0.65x
─ Acquisition of Information Mosaic
─ Acquisition of CoreOne Technologies3
─ Expected $150 million share buyback4
Pro forma leverage
(Year end 2015)
~ 1.5x
6M overview:
─ Strong operating cash flow of
$197.9 million with significant
contribution from positive
working capital movements
─ Disciplined deployment of capital
expenditure of $63.6 million for
6M 2015
─ $394.1 million outflow on share
buybacks
─ Net debt increased $104.7
million
1. LTM Adjusted EBITDA is defined as Adjusted EBITDA for the previous twelve month period to date reported
2. Leverage is defined as net debt divided by LTM Adjusted EBITDA
3. Subject to regulatory approval and closing conditions
4. Subject to conditions at the time
26. 26
187.3
191.7
190.8
~182
~180
~182
4.4
2.3
~2
~2
3.2
~11
~4
Q4 2014 Dilution Q1 2015 Dilution Share
repurchase
Q2 2015 Dilution Share
repurchase
Q3 2015 Dilution Share
repurchase
Q4 2015 FY 2016
Estimated in-quarter weighted average number of shares, diluted
Managing diluted shares outstanding
1
─ $350m share repurchase (~14m shares) completed June 10th, 2015
─ $150m remainder of authorised share buyback programme expected to be utilised by year end
─ Future buybacks expected to offset dilutive impact of annual compensation awards and option exercises
(million)
Expected
Dilution refers to dilutive impact of employee options and restricted stock.
Q2 and Q3 share repurchase totals refer to June 10, 2015 share repurchase of approximately $350m. Q4 share repurchase total is time-weighted and assumes utilisation of remaining
$150m authorisation in Q4 2015 (subject to conditions at the time) and share price of $26.30.
Q3 and Q4 dilution assumes average share price of $26.30 and option exercise of over 3m shares in each quarter.
2016 assumes a flat average share price, the exercise of 12.6m options and that all proceeds from exercise are utilised to repurchase shares.
Q2 2015 results review
27. 27
Q2 2015 results review
Shares outstanding
Summary
─ Average share price is a key driver of the
dilution calculation, an indicative estimate of
the impact of share price fluctuations on
diluted share count is shown in the table
─ Weighted average number of shares, diluted
is calculated in accordance with IFRS
─ The majority of options with a strike price
below $26.70 vested on IPO
─ Options with a strike price at $26.70 largely
vest in tranches over a 5 year period from
IPO date or January 2014
─ Option exercises will generate substantial
cash inflows as well as cash tax benefits
(million except share price) Q2 2015 Q2 2014
Number of shares outstanding at the reporting date 176.7 180.9
Weighted average number of shares, basic 183.1 177.3
Option dilution 6.5 4.8
Restricted shares dilution 1.2 0.7
Weighted average number of shares, diluted 190.8 182.8
Share price used for 2Q15 dilution calculation $26.30 $21.80
Illustrative average
share price
Illustrative diluted average
number of shares (million)
$23 188.0
$27 191.3
$30 196.5
Exercise price Outstanding (million) Unvested (million)
< $15.00 3.4 –
$15.00- $19.99 4.3 –
$20.00- $26.69 18.3 6.2
> $26.69 30.5 27.5
Total 56.5 33.7
Three months ended June 30th – Reported
Illustrative weighted average diluted number of shares three
months ended June 30th 2015
Total outstanding options at June 30th 2015
29. 29
Track record of consistent financial performance
Financial overview
$261
$305
$358
$421
$488
2010 2011 2012 2013 2014
Adjusted EBITDA
Adjusted EBITDA margin
$145
$185
$218
$248
$279
2010 2011 2012 2013 2014
$668
$763
$861
$948
$1,065
2010 2011 2012 2013 2014
Note: Financials presented under IFRS accounting guidelines. Adjusted EBITDA, Adjusted Earnings and Adjusted EBITDA margin are non-IFRS financial measures.
Please see Appendix for definitions of these measures and a reconciliation of non-IFRS financial measures to IFRS financial measures.
─ Recurring revenue ~95%: products and services primarily offered through recurring fixed fee and
variable fee agreements
─ Strong organic growth: breadth of offerings and large, global customer base allow cross-selling of
products and services
─ High cash generation: high adjusted EBITDA margins and low capital requirements
Revenue ($m) Adjusted EBITDA ($m) and margin Adjusted Earnings ($m)
46.2% 45.8% 47.0% 45.6% 46.0%
30. 30
Stable and diversified revenue streams
Financial overview
Revenue growth composition
2014 revenue by geography
Note: Acquisition related growth is defined as revenue growth from acquired businesses through the end of the fiscal year following the fiscal year in which the acquisition was completed.
Recurring fixed
renewal rate: ~90%
2014 revenue by type
US
50%
European
Union
39%
Other
11%
5.9% 6.1%
7.8%
7.0%
4.0%
4.6%
12.9%
10.1%
12.4%
2012 2013 2014
Organic growth Acquired growth & FX
Recurring fixed
53%
Recurring
variable
42%
Non-recurring
5%
32. 32
Financial overview
Acquisitions
43%
Internal
investments
21%
Share
repurchases
36%
1. Internal investments 2. Acquisitions 3. Share repurchases
2010 – 2014 cumulative capital allocation
Total: $2,395m
$70 $75 $99 $131 $125
$242
$67
$381
$224
$129
$183
$52
$619
$495
$194
$1,099
$355
$254
2010 2011 2012 2013 2014
($mm)
Internal investments Acquisitions Share repurchases
─ Target leverage ratio of 1.5 – 2.0x
─ In order to maintain or adjust the capital structure, Markit returns capital to shareholders, issues new shares or sells
assets to reduce debt
1
1 Includes $495m in share repurchases conducted in August 2012 payable in quarterly installments through to May 2017.
2 Does not reflect $350m share repurchase completed June 10, 2015.
($m)
Balanced and flexible capital allocation framework
2
33. 33
Committed to long-term financial objectives
─ Maintain 5-7% organic revenue growth
─ Double digit revenue growth with acquisitions
─ Maintain low to mid 40% Adjusted EBITDA margin
Disclaimer: These objectives are forward-looking, are subject to significant business, economic, regulatory and competitive uncertainties and contingencies, many of
which are beyond the control of the Company and its management, and are based upon assumptions with respect to future decisions, which are subject to
change. Actual results will vary and those variations may be material. Nothing in this presentation should be regarded as a representation by any person that these
objectives will be achieved and the Company undertakes no duty to update its objectives as circumstances change.
Financial overview
35. 35
Impact of electronic trading on Processing
~40%
~60%
Loans /
FX /
Equities
Rates /
Credit
~30%
~30%
Rates /
Credit not
impacted
Rates /
Credit
impacted
2014 Processing revenue by asset class
Rates / Credit revenue
Regulation will introduce trading rules over the next three
years that affect standardized OTC derivatives
─US: CFTC already enacted rules, SEC yet to issue final rules
─Europe: likely implementation late 2016 or 2017
─Asia: various jurisdictions in different stages of implementation
Loans / FX / Equities
─No anticipated material impact from new regulations
─Future growth will come from strong market volume increases in Loans and
increased market share and new solutions in FX and Equities
Rates / Credit
─Half of Rates / Credit revenue derives from less liquid products and markets which
are unlikely to be impacted by trading rules
─For electronic/cleared trades, simpler processing results in lower revenues per
ticket (up to ~80% lower ticket price)
─Electronic/cleared trading impact on market share and volumes not fully known
─Revenue impact estimated to be phased in over three years through 2017
Gross estimated annual revenue impact of $50–60m
─Pricing discounts implemented in Q2 2015 estimated $3–5m revenue impact per
quarter ($12–20m annual revenue impact)
Potential mitigants to financial impact:
─Further growth in Loans, Equities, and FX
─New services such as FX Options
─Trade volume increases due to electronic trading
─Managing costs to minimize the Adjusted EBITDA impact
FY 2014 revenue: $284.9m
Appendix: Processing division
36. 36
Definitions
Revenue growth
We measure revenue growth in terms of organic revenue growth, acquisition related revenue growth, foreign currency impact on revenue growth and constant currency revenue
growth. We define these components as follows:
Organic – Revenue growth from continuing operations from factors other than acquisitions and foreign currency fluctuations. We derive organic revenue growth from the
development of new products and services, increased penetration of existing products and services to new and existing customers, price changes for our products and services and
market driven factors such as increased trading volumes or changes in customer assets under management.
Acquisition related – Revenue growth from acquired businesses through the end of the fiscal year following the fiscal year in which the acquisition was completed. This growth
results from our strategy of making targeted acquisitions that facilitate growth by complementing our existing products and services and addressing market opportunities.
Foreign currency – The impact on revenue growth resulting from the difference between current revenue at current exchange rates and current revenue at the corresponding prior
period exchange rates.
Constant currency – Total revenue growth, excluding the impact of exchange rate movements from the prior period to the current period. This is equal to the combination of organic
and acquisition related revenue growth, as described above.
Revenue by type
Revenue by type is how we classify the income recognized from the sale of our products and services into three groups as defined below:
Recurring fixed revenue – Revenue generated from contracts specifying a fixed fee for services delivered over the life of the contract. The fixed fee is typically paid annually,
semiannually or quarterly in advance. These contracts are typically subscription contracts where the revenue is recognized across the life of the contract. The initial term of these
contracts can range from one to five years and usually includes auto-renewal clauses.
Recurring variable revenue – Revenue derived from contracts that specify a fee for services which is typically not fixed. The variable fee is typically paid monthly in arrears.
Recurring variable revenue is based on, among other factors, the number of trades processed, assets under management or the number of positions we value. Many of these
contracts do not have a maturity date while the remainder have an initial term ranging from one to five years.
Non-recurring revenue – Revenue that relates to certain software license sales and the associated consulting revenue.
Other Non-IFRS Measures
Adjusted EBITDA is defined as profit for the period from continuing operations before income taxes, net finance costs, depreciation and amortisation on fixed assets and intangible
assets (including acquisition related intangible assets), acquisition related items, exceptional items, share based compensation and related items, net other gains or losses, including
Adjusted EBITDA attributable to joint ventures and excluding Adjusted EBITDA attributable to non-controlling interests.
Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue, excluding revenue attributable to non-controlling interests.
Adjusted Earnings is defined as profit for the period from continuing operations before amortisation of acquired intangibles, acquisition related items, exceptional items, share based
compensation and related items, net other gains or losses and unwind of discount, less the tax effect of these adjustments and excluding Adjusted Earnings attributable to non-
controlling interests.
Adjusted EPS diluted is defined as Adjusted Earnings divided by the weighted average number of shares used to compute earnings per share, diluted.
Appendix: Definitions
37. 37
Appendix: reconciliation of non-IFRS financial measures to IFRS financial measures
Reconciliation to Adjusted EBITDA
($ million)
Q2 2015 Q2 2014 6M 2015 6M 2014 FY2014
LTM ended
June 2015
Profit for the period 44.5 29.4 99.0 69.2 164.1 193.9
Income tax expense 22.6 9.6 43.4 25.2 56.5 74.7
Finance costs – net 3.7 3.9 7.8 8.3 16.9 16.4
Depreciation and amortisation - other 26.4 23.5 51.3 46.8 100.1 104.6
Amortisation – acquisition related 14.4 14.1 28.8 28.3 57.9 58.4
Acquisition related items - 2.2 - 5.0 (12.4) (17.4)
Exceptional items 1.8 31.3 3.2 42.4 84.9 45.7
Share based compensation and related
items
8.7 3.1 18.6 6.1 16.0 28.5
Other (gains) / losses – net (0.2) 2.9 (8.1) 5.4 6.0 (7.5)
Share of results from joint venture not
attributable to Adjusted EBITDA
(0.6) -- (1.3) - (1.1) (2.4)
Adjusted EBITDA attributable to non-
controlling interests
(0.4) -- (1.1) - (0.7) (1.8)
Adjusted EBITDA 120.9 120.0 241.6 236.7 488.2 493.1
38. 38
Reconciliation to Adjusted EBITDA
2010 2011 2012 2013 2014
Profit for the period 151.2 156.2 153.1 147.0 164.1
Income tax expense 43.8 50.6 42.7 63.7 56.5
Finance costs – net 18.2 22.9 28.9 19.4 16.9
Depreciation and amortisation - other 48.2 62.7 66.7 86.0 100.1
Amortisation – acquisition related 28.5 34.4 46.2 50.1 57.9
Acquisition related items (11.3) 4.8 0.9 (1.4) (12.4)
Exceptional items 30.9 11.6 40.3 60.6 84.9
Share based compensation and related items 14.9 11.7 16.2 8.1 16.0
Other losses / (gains) – net 0.1 4.6 11.6 (0.7) 6.0
Share of results from joint venture not
attributable to Adjusted EBITDA
0.0 0.0 0.0 0.0 (1.1)
Adjusted EBITDA attributable to non-controlling
interests
(63.5) (54.5) (48.4) (11.5) (0.7)
Adjusted EBITDA 261.0 305.0 358.2 421.3 488.2
($m)
Appendix: reconciliation of non-IFRS financial measures to IFRS financial measures
39. 39
Appendix: reconciliation of non-IFRS financial measures to IFRS financial measures
Reconciliation to Adjusted Earnings
($ million)
Q2 2015 Q2 2014 6M 2015 6M 2014
Profit for the period 44.5 29.4 99.0 69.2
Amortisation – acquisition related 14.4 14.1 28.8 28.3
Acquisition related items - 2.2 - 5.0
Exceptional items 1.8 31.3 3.2 42.4
Share based compensation and related items 8.7 3.1 18.6 6.1
Other (gains) / losses – net (0.2) 2.9 (8.1) 5.4
Unwind of discount
(1)
2.3 2.4 4.8 4.9
Tax effect of above adjustments (2.7) (17.1) (8.3) (20.1)
Adjusted Earnings attributable to non-controlling interests (0.4) - (1.1) -
Adjusted Earnings 68.4 68.3 136.9 141.2
Weighted average number of shares for computation of
earnings per share, diluted
190,780,009 182,777,170 191,085,644 180,724,370
1. Unwind of discount represents the non-cash unwinding of discount, recorded through finance costs – net in the income statement, primarily in relation to our share buyback liability.
40. 40
Reconciliation to Adjusted Earnings
2010 2011 2012 2013 2014
Profit for the period 151.2 156.2 153.1 147.0 164.1
Amortisation – acquisition related 28.5 34.4 46.2 50.1 57.9
Acquisition related items (11.3) 4.8 0.9 (1.4) (12.4)
Exceptional items 30.9 11.6 40.3 60.6 84.9
Share based compensation and related
items
14.9 11.7 16.2 8.1 16.0
Other losses / (gains) – net 0.1 4.6 11.6 (0.7) 6.0
Unwind of discount
1
3.4 8.9 9.3 12.4 10.5
Tax effect of above adjustments (14.6) (7.6) (24.1) (18.0) (47.4)
Adjusted Earnings attributable to non-
controlling interests
(58.2) (39.8) (35.1) (9.7) (0.6)
Adjusted Earnings 144.9 184.8 218.4 248.4 279.0
Weighted average number of shares for
computation of earnings per share, diluted
182,347,790 181,730,830 180,020,120 175,550,760 184,467,540
($m)
1 Unwind of discount represents the non-cash unwinding of discount, recorded through finance costs – net in the income statement, primarily in relation to our share buyback liability.
Appendix: reconciliation of non-IFRS financial measures to IFRS financial measures