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Third quarter 2014 financial results 
November 12th 2014
2 
Important notice 
Forward-looking statements 
This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and 
Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this 
presentation that address activities, events or developments that Markit Ltd. (“Markit” or the “Company”) expects, believes or 
anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking 
statements contained in this presentation may include the expectations of management regarding plans, strategies, 
objectives and anticipated financial and operating results of the Company. Markit’s estimates and forward-looking statements are 
mainly based on its current expectations and estimates of future events and trends, which affect or may affect its businesses and 
operations. Although Markit believes that these estimates and forward-looking statements are based upon reasonable 
assumptions, they are subject to several risks and uncertainties and are made in light of information currently available to Markit. 
When used in this presentation, the words “anticipate,” “believe,” “intend,” “expect,” “plan,” “will” or other similar words are 
intended to identify forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, 
many of which are beyond the control of Markit, which may cause actual results to differ materially from those implied or 
expressed by the forward-looking statements. Further information on such assumptions, risks and uncertainties is available in 
Markit’s filings with the United States Securities and Exchange Commission (“SEC”). Markit’s SEC filings are available at 
www.sec.gov or on the investor relations section of its website, www.markit.com. Markit undertakes no obligation and does not 
intend to update these forward-looking statements to reflect events or circumstances occurring after the date of this presentation. 
You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press 
release. All forward-looking statements are qualified in their entirety by this cautionary statement. 
Non-IFRS financial measures 
This presentation also includes measures defined by the SEC as non-IFRS financial measures. Markit believes that these non- 
IFRS measures can provide useful supplemental information to securities analysts, investors and other interested parties 
regarding financial and business trends relating to its financial condition and results of operations when read in conjunction with 
the company’s reported results. Definitions and reconciliations of these non-IFRS measures to most directly comparable IFRS 
financial measures are available in the Appendix of this presentation and in Markit’s earnings release dated November 12, 2014. 
Copyright ©2014, Markit Group Limited. All rights reserved and all intellectual property rights are retained by Markit.
3 
Agenda 
Third quarter 2014 overview 
Lance Uggla, CEO 
Third quarter and nine months 2014 financial results 
Jeff Gooch, CFO 
Appendix
4 
Third quarter 2014 overview 
Lance Uggla
5 
Q3 2014 financial results overview 
Strong third quarter financial performance 
 Revenue increased 13.1% to a quarterly record of $269.7 million 
 Constant currency revenue growth +11.1% (8.1% organic, 3.0% acquired) 
 Driven by revenue growth in all three business segments: 
 Information +6.8%, organic growth +4.8% 
 Processing +12.5%, organic growth +9.4% 
 Solutions +26.2%, organic growth +13.1%, acquired growth +12.1% 
 Recurring revenue of 94.9%; recurring fixed revenue increased to 53.6% of total 
revenue from 50.8% 
 Continued profitability and strong margins maintained 
 Adjusted EBITDA grew 14.5%; Adjusted EBITDA margin of 47.3% 
 Adjusted Earningswas $68.7 million and Adjusted EPS diluted was $0.37 
Adjusted EBITDA is defined as profit for the period from continuing operations before income taxes, net finance costs, depreciation and amortisation on fixed assets and intangible assets 
(including acquisition related intangible assets), acquisition related items, exceptional items, share based compensation and net other gains or losses and excluding Adjusted EBITDA 
attributable to non-controlling interests. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue, excluding revenue attributable to non-controlling interests. 
Adjusted Earnings is defined as profit for the period from continuing operations before amortisation of acquired intangibles, acquisition related items, exceptional items, share based 
compensation, net other gains or losses and unwind of discount, less the tax effect of these adjustments and excluding Adjusted Earnings attributable to non-controlling interests. 
Adjusted EPS diluted is defined as Adjusted Earnings divided by the weighted average number of shares used to compute earnings per share, diluted.
6 
Q3 2014 financial results overview 
Third quarter 2014 highlights 
 Strong financial performance and organic growth across all three 
business segments 
 Organic growth in Information through product enhancements and 
penetrating new customers 
 Strong Processing volumes driven by market volatility; no significant 
revenue impact from electronic trading 
 Solutions achieved double digit growth driven by demand across all 
major products 
 Well positioned to deliver on longterm financial objectives
7 
Q3 and 9 months 2014 financial results 
Jeff Gooch
8 
Q3 and 9M 2014 financial results 
Summary financial results 
($ million) 
Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% 
Revenue 269.7 238.4 13.1% 793.7 704.1 12.7% 
Constant currency growth - - 11.1% - - 10.4% 
Adjusted EBITDA(1) 126.8 110.7 14.5% 363.5 312.9 16.2% 
Adjusted EBITDA margin (2) 47.3% 46.4% - 45.9% 46.0% - 
Adjusted Earnings (3) 68.7 64.7 6.2% 209.9 183.0 14.7% 
Adjusted EPS diluted (4) $0.37 $0.37 - % $1.14 $1.04 9.6% 
Weighted average number of shares 
used to compute earnings per share, 
diluted 
187.9 176.5 6.5% 183.6 175.8 4.4% 
1. Adjusted EBITDA is defined as profit for the period from continuing operations before income taxes, net finance costs, depreciation and amortisation on fixed assets and 
intangible assets (including acquisition related intangible assets), acquisition related items, exceptional items, share based compensation and net other gains or losses 
and excluding Adjusted EBITDA attributable to non-controlling interests. 
2. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue, excluding revenue attributable to non-controlling interests. 
3. Adjusted Earnings is defined as profit for the period from continuing operations before amortisation of acquired intangibles, acquisition related items, exceptional items, 
share based compensation, net other gains or losses and unwind of discount, less the tax effect of these adjustments and excluding Adjusted Earnings attributable to 
non-controlling interests. 
4. Adjusted EPS diluted is defined as Adjusted Earnings divided by the weighted average number of shares used to compute earnings per share diluted.
9 
Q3 and 9M 2014 financial results 
Revenue growth 
($ million) 
Q3 2014 vs. Q3 2013 9M 2014 vs. 9M 2013 
$238.4 
$19.3 
$7.1 
$4.9 
$269.7 
$280 
$270 
$260 
$250 
$240 
$230 
$220 
$210 
$200 
Q3 2013 
revenue 
Organic 
growth 
Acquired 
growth 
FX / 
Currency 
impact 
Q3 2014 
revenue 
+8.1% 
+3.0% 
+2.0% 
+13.1% 
$704.1 
$53.1 $20.6 $15.9 $793.7 
$900 
$800 
$700 
$600 
$500 
$400 
$300 
$200 
9M 2013 
revenue 
Organic 
growth 
Acquired 
growth 
FX / 
Currency 
impact 
9M 2014 
revenue 
+7.5% 
+2.9% 
+2.3% 
+12.7%
10 
Q3 and 9M 2014 financial results 
Revenue mix - Q3 2014 
53.6% 
41.3% 
5.1% 
Recurring fixed 
Recurring variable 
Non-recurring 
Q3 2014: $269.7 
million 
$ million/ % Q3 2014 % Q3 2013 % YoY YoY% 
Recurring fixed $144.6 53.6% $121.1 50.8% $23.5 2.8% 
Recurring variable $111.4 41.3% $108.0 45.3% $3.4 (4.0)% 
Non-recurring $13.7 5.1% $9.3 3.9% $4.4 1.2% 
Total Revenue $269.7 $238.4 $31.3 
Key features: 
 Recurring fixed revenue 
increased due primarily to 
new business wins 
 Recurring variable revenue 
decreased as a percentage 
of total revenue 
 Non-recurring revenue 
increased due to new 
business wins in Solutions
11 
Q3 and 9M 2014 financial results 
Operating expenses 
($ million) 
Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% 
Personnel 
costs 
(86.7) (77.9) 11.3% (265.1) (231.5) 14.5% 
Non 
personnel 
costs 
(55.9) (49.8) 12.2% (164.8) (148.2) 11.2% 
Total 
operating 
expenses 
(142.6) (127.7) 11.7% (429.9) (379.7) 13.2% 
Q3 highlights: 
 Personnel costs increased 
due to acquisitions and new 
hires 
 Employee growth was 
predominantly in low cost 
locations 
 Non personnel costs 
increased due to public 
company running costs and 
investments in new product 
development
12 
Q3 and 9M 2014 financial results 
Information 
($ million) 
115.5 
123.4 
54.4 
61.1 
150 
125 
100 
75 
50 
25 
0 
+6.8% 
Q3 2013 Q3 2014 
Revenue Adjusted EBITDA 
Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% 
Revenue 123.4 115.5 6.8% 363.3 342.7 6.0% 
Organic growth - - 4.8% - - 3.8% 
Adjusted EBITDA 61.1 54.4 12.3% 174.9 160.8 8.8% 
Adjusted 
EBITDA margin 
49.5% 47.1% - 48.1% 46.9% - 
Q3 highlights: 
 Strong revenue growth in 
Pricing and Reference data 
 Revenue growth in Valuation 
and Trading Services, despite 
wind down of Markit Trade 
Reporting 
 Customer retention and 
renewals remain strong
13 
Q3 and 9M 2014 financial results 
Processing 
($ million) 
Q3 highlights: 
 Loans processing revenue 
growth driven by increased 
activity in secondary market 
 Derivatives processing revenue 
benefitted from high trading 
volumes due to increased market 
volatility 
 Limited revenue impact from 
SEF regulations YTD 
64.2 
72.2 
+12.5% 
34.6 
41.9 
100 
75 
50 
25 
0 
Q3 2013 Q3 2014 
Revenue Adjusted EBITDA 
Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% 
Revenue 72.2 64.2 12.5% 216.4 200.3 8.0% 
Organic growth - - 9.4% - - 4.8% 
Adjusted EBITDA 41.9 34.6 21.1% 120.1 108.3 10.9% 
Adjusted 
EBITDA margin 
58.0% 53.9% - 55.5% 54.1% -
14 
Q3 and 9M 2014 financial results 
Impact of electronic trading on Processing 
9M 2014 Processing revenue by asset class 
~40% 
~60% 
Loans / 
FX / 
Equities 
Rates / 
Credit 
~30% 
~30% 
Rates / 
Credit not 
impacted 
Rates / 
Credit 
impacted 
Rates / Credit revenue 
Regulation will introduce trading rules that affect 
standardized OTC derivatives over the next three years 
US: CFTC already enacted rules, SEC yet to issue final rules 
Europe: consultation late 2014 with likely implementation late 2016 or 2017 
Asia: various jurisdictions in different stages of implementation 
Loans / FX / Equities 
No anticipated material impact from new regulations, low double digit 2014 YTD 
growth 
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 
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 EBITDA impact 
9M 2014: $216.4 million
15 
Q3 and 9M 2014 financial results 
Solutions 
($ million) 
58.7 
74.1 
+26.2% 
21.7 24.1 
100 
75 
50 
25 
0 
Q3 2013 Q3 2014 
Revenue Adjusted EBITDA 
Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% 
Revenue 74.1 58.7 26.2% 214.0 161.1 32.8% 
Organic growth - - 13.1% - - 18.9% 
Acquisition related - - 12.1% - - 12.8% 
Adjusted EBITDA 24.1 21.7 11.1% 68.8 55.3 24.4% 
Adjusted EBITDA 
margin 
32.5% 37.0% - 32.1% 34.3% - 
Q3 highlights: 
 Double digit organic revenue 
growth driven by new business 
wins across Managed Services 
and Enterprise Software 
 Markit Corporate Actions, 
thinkFolio, and CTI acquisitions 
contributed +12.1% to revenue 
growth 
 Adjusted EBITDA margins lower 
due to continued investment in 
growth initiatives
16 
Q3 and 9M 2014 financial results 
Exceptional items 
($ million) 
Q3 2014 Q3 2013 9M 2014 9M 2013 
Legal advisory costs (1.1) (1.6) (4.0) (3.8) 
Impairments (8.3) (12.7) (8.3) (12.7) 
Profit on sale of available-for-sale financial 
asset 
- - - 4.2 
IPO preparation and execution costs - - (12.1) - 
Accelerated IFRS 2 charges - - (7.3) - 
Recognition of liability for social security 
costs on option exercise 
- - (20.1) - 
Total exceptional items (9.4) (14.3) (51.8) (12.3)
17 
Q3 and 9M 2014 financial results 
Net debt / leverage 
($ million) 
September 
30th 2014 
December 
31st 2013 
Bank borrowings 274.3 268.0 
Share buyback 235.1 306.6 
Total borrowings 509.4 574.6 
Cash and cash equivalents (81.1) (75.3) 
Net debt 428.3 499.3 
LTM Adjusted EBITDA(1) 471.9 421.3 
Leverage 
(Net debt/ LTM Adjusted EBITDA) 
0.91x 1.19x 
1. LTM Adjusted EBITDA is defined as Adjusted EBITDA for the previous twelve month period to date reported 
Q3 highlights: 
 Net debt down 14.2% or $71.0 
million 
 Leverage remains low at 0.91x 
 $88.0 million capital expenditure 
YTD 2014, down 7.1% or $6.7 
million year on year
18 
Appendix
19 
Q3 and 9M 2014 financial results 
Definitions 
Revenue growth 
We measure revenue growth in terms of organic revenue growth, acquisition related revenue growth and foreign currency impact on 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 recognised 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 recognised 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 net other gains or losses 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. 
LTM Adjusted EBITDA is defined as Adjusted EBITDA for the previous twelve month period from date reported 
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, 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.
20 
Q3 and 9M 2014 financial results 
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 priced at below 
$26.70 vested on IPO 
 Options priced 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 
 Surplus cash will be used for general 
corporate purposes including investment in 
our business and to pursue acquisitions 
Three months ended September 30th – Reported 
(million except share price) 
2014 2013 
Weighted average number of shares, basic 180.0 175.3 
Option dilution 6.9 0.8 
Restricted shares dilution 1.0 0.4 
Weighted average number of shares, diluted 187.9 176.5 
Share price used for Q314 dilution calculation $25.14 - 
Illustrative weighted average diluted number of shares 
three months ended September 30th 2014 
Illustrative average 
share price 
Illustrative diluted average 
number of shares (million) 
$23 186.0 
$27 189.9 
$30 195.6 
Total outstanding options at September 30th 2014 
Exercise price Outstanding (million) Unvested (million) 
 $15.00 4.8 – 
$15.00- $19.99 6.1 1.1 
$20.00- $26.69 22.3 8.9 
 $26.69 33.7 33.2 
Total 66.9 43.2
21 
Q3 and 9M 2014 financial results 
Reconciliation to Adjusted EBITDA 
($ million) 
Q3 2014 Q3 2013 9M 2014 9M 2013 FY 2013 
LTM 
ended 
Sep. 2014 
Profit for the period 79.2 32.4 148.4 144.1 147.0 151.3 
Income tax expense 11.6 16.5 36.8 52.1 63.7 48.4 
Finance costs – net 4.5 4.7 12.8 15.0 19.4 17.2 
Depreciation and amortisation 25.1 21.9 71.9 62.4 86.0 95.5 
Amortisation – acquisition related 15.0 12.6 43.3 37.0 50.1 56.4 
Acquisition related items (16.0) 0.1 (11.0) 0.2 (1.4) (12.6) 
Exceptional items 9.4 14.3 51.8 12.3 60.6 100.1 
Share based compensation and related items 0.7 2.0 6.8 5.9 8.1 9.0 
Other losses/ (gains) – net (2.4) 6.2 3.0 (4.6) (0.7) 6.9 
Adjusted EBITDA attributable to non-controlling 
interests 
(0.3) - (0.3) (11.5) (11.5) (0.3) 
Adjusted EBITDA 126.8 110.7 363.5 312.9 421.3 471.9
Q3 2014 Q3 2013 9M 2014 9M 2013 
Profit for the period 79.2 32.4 148.4 144.1 
Amortisation – acquisition related 15.0 12.6 43.3 37.0 
Acquisition related items (16.0) 0.1 (11.0) 0.2 
Exceptional items 9.4 14.3 51.8 12.3 
Share based compensation and related items 0.7 2.0 6.8 5.9 
Other losses/ (gains) – net (2.4) 6.2 3.0 (4.6) 
2.9 3.0 7.8 9.8 
Tax effect of above adjustments (20.4) (5.9) (40.5) (12.0) 
Adjusted Earnings attributable to non-controlling interests 0.3 - 0.3 (9.7) 
Adjusted Earnings 68.7 64.7 209.9 183.0 
187,893,323 176,547,638 183,630,386 175,835,360 
 22 
Q3 and 9M 2014 financial results 
Reconciliation to Adjusted Earnings 
($ million) 
Unwind of discount 
(1) 
Weighted average number of shares for computation of 
earnings per share, diluted 
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.

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Mrkt q3 14 results presentation

  • 1. Third quarter 2014 financial results November 12th 2014
  • 2. 2 Important notice Forward-looking statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this presentation that address activities, events or developments that Markit Ltd. (“Markit” or the “Company”) expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this presentation may include the expectations of management regarding plans, strategies, objectives and anticipated financial and operating results of the Company. Markit’s estimates and forward-looking statements are mainly based on its current expectations and estimates of future events and trends, which affect or may affect its businesses and operations. Although Markit believes that these estimates and forward-looking statements are based upon reasonable assumptions, they are subject to several risks and uncertainties and are made in light of information currently available to Markit. When used in this presentation, the words “anticipate,” “believe,” “intend,” “expect,” “plan,” “will” or other similar words are intended to identify forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Markit, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. Further information on such assumptions, risks and uncertainties is available in Markit’s filings with the United States Securities and Exchange Commission (“SEC”). Markit’s SEC filings are available at www.sec.gov or on the investor relations section of its website, www.markit.com. Markit undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after the date of this presentation. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement. Non-IFRS financial measures This presentation also includes measures defined by the SEC as non-IFRS financial measures. Markit believes that these non- IFRS measures can provide useful supplemental information to securities analysts, investors and other interested parties regarding financial and business trends relating to its financial condition and results of operations when read in conjunction with the company’s reported results. Definitions and reconciliations of these non-IFRS measures to most directly comparable IFRS financial measures are available in the Appendix of this presentation and in Markit’s earnings release dated November 12, 2014. Copyright ©2014, Markit Group Limited. All rights reserved and all intellectual property rights are retained by Markit.
  • 3. 3 Agenda Third quarter 2014 overview Lance Uggla, CEO Third quarter and nine months 2014 financial results Jeff Gooch, CFO Appendix
  • 4. 4 Third quarter 2014 overview Lance Uggla
  • 5. 5 Q3 2014 financial results overview Strong third quarter financial performance Revenue increased 13.1% to a quarterly record of $269.7 million Constant currency revenue growth +11.1% (8.1% organic, 3.0% acquired) Driven by revenue growth in all three business segments: Information +6.8%, organic growth +4.8% Processing +12.5%, organic growth +9.4% Solutions +26.2%, organic growth +13.1%, acquired growth +12.1% Recurring revenue of 94.9%; recurring fixed revenue increased to 53.6% of total revenue from 50.8% Continued profitability and strong margins maintained Adjusted EBITDA grew 14.5%; Adjusted EBITDA margin of 47.3% Adjusted Earningswas $68.7 million and Adjusted EPS diluted was $0.37 Adjusted EBITDA is defined as profit for the period from continuing operations before income taxes, net finance costs, depreciation and amortisation on fixed assets and intangible assets (including acquisition related intangible assets), acquisition related items, exceptional items, share based compensation and net other gains or losses and excluding Adjusted EBITDA attributable to non-controlling interests. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue, excluding revenue attributable to non-controlling interests. Adjusted Earnings is defined as profit for the period from continuing operations before amortisation of acquired intangibles, acquisition related items, exceptional items, share based compensation, net other gains or losses and unwind of discount, less the tax effect of these adjustments and excluding Adjusted Earnings attributable to non-controlling interests. Adjusted EPS diluted is defined as Adjusted Earnings divided by the weighted average number of shares used to compute earnings per share, diluted.
  • 6. 6 Q3 2014 financial results overview Third quarter 2014 highlights Strong financial performance and organic growth across all three business segments Organic growth in Information through product enhancements and penetrating new customers Strong Processing volumes driven by market volatility; no significant revenue impact from electronic trading Solutions achieved double digit growth driven by demand across all major products Well positioned to deliver on longterm financial objectives
  • 7. 7 Q3 and 9 months 2014 financial results Jeff Gooch
  • 8. 8 Q3 and 9M 2014 financial results Summary financial results ($ million) Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% Revenue 269.7 238.4 13.1% 793.7 704.1 12.7% Constant currency growth - - 11.1% - - 10.4% Adjusted EBITDA(1) 126.8 110.7 14.5% 363.5 312.9 16.2% Adjusted EBITDA margin (2) 47.3% 46.4% - 45.9% 46.0% - Adjusted Earnings (3) 68.7 64.7 6.2% 209.9 183.0 14.7% Adjusted EPS diluted (4) $0.37 $0.37 - % $1.14 $1.04 9.6% Weighted average number of shares used to compute earnings per share, diluted 187.9 176.5 6.5% 183.6 175.8 4.4% 1. Adjusted EBITDA is defined as profit for the period from continuing operations before income taxes, net finance costs, depreciation and amortisation on fixed assets and intangible assets (including acquisition related intangible assets), acquisition related items, exceptional items, share based compensation and net other gains or losses and excluding Adjusted EBITDA attributable to non-controlling interests. 2. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue, excluding revenue attributable to non-controlling interests. 3. Adjusted Earnings is defined as profit for the period from continuing operations before amortisation of acquired intangibles, acquisition related items, exceptional items, share based compensation, net other gains or losses and unwind of discount, less the tax effect of these adjustments and excluding Adjusted Earnings attributable to non-controlling interests. 4. Adjusted EPS diluted is defined as Adjusted Earnings divided by the weighted average number of shares used to compute earnings per share diluted.
  • 9. 9 Q3 and 9M 2014 financial results Revenue growth ($ million) Q3 2014 vs. Q3 2013 9M 2014 vs. 9M 2013 $238.4 $19.3 $7.1 $4.9 $269.7 $280 $270 $260 $250 $240 $230 $220 $210 $200 Q3 2013 revenue Organic growth Acquired growth FX / Currency impact Q3 2014 revenue +8.1% +3.0% +2.0% +13.1% $704.1 $53.1 $20.6 $15.9 $793.7 $900 $800 $700 $600 $500 $400 $300 $200 9M 2013 revenue Organic growth Acquired growth FX / Currency impact 9M 2014 revenue +7.5% +2.9% +2.3% +12.7%
  • 10. 10 Q3 and 9M 2014 financial results Revenue mix - Q3 2014 53.6% 41.3% 5.1% Recurring fixed Recurring variable Non-recurring Q3 2014: $269.7 million $ million/ % Q3 2014 % Q3 2013 % YoY YoY% Recurring fixed $144.6 53.6% $121.1 50.8% $23.5 2.8% Recurring variable $111.4 41.3% $108.0 45.3% $3.4 (4.0)% Non-recurring $13.7 5.1% $9.3 3.9% $4.4 1.2% Total Revenue $269.7 $238.4 $31.3 Key features: Recurring fixed revenue increased due primarily to new business wins Recurring variable revenue decreased as a percentage of total revenue Non-recurring revenue increased due to new business wins in Solutions
  • 11. 11 Q3 and 9M 2014 financial results Operating expenses ($ million) Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% Personnel costs (86.7) (77.9) 11.3% (265.1) (231.5) 14.5% Non personnel costs (55.9) (49.8) 12.2% (164.8) (148.2) 11.2% Total operating expenses (142.6) (127.7) 11.7% (429.9) (379.7) 13.2% Q3 highlights: Personnel costs increased due to acquisitions and new hires Employee growth was predominantly in low cost locations Non personnel costs increased due to public company running costs and investments in new product development
  • 12. 12 Q3 and 9M 2014 financial results Information ($ million) 115.5 123.4 54.4 61.1 150 125 100 75 50 25 0 +6.8% Q3 2013 Q3 2014 Revenue Adjusted EBITDA Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% Revenue 123.4 115.5 6.8% 363.3 342.7 6.0% Organic growth - - 4.8% - - 3.8% Adjusted EBITDA 61.1 54.4 12.3% 174.9 160.8 8.8% Adjusted EBITDA margin 49.5% 47.1% - 48.1% 46.9% - Q3 highlights: Strong revenue growth in Pricing and Reference data Revenue growth in Valuation and Trading Services, despite wind down of Markit Trade Reporting Customer retention and renewals remain strong
  • 13. 13 Q3 and 9M 2014 financial results Processing ($ million) Q3 highlights: Loans processing revenue growth driven by increased activity in secondary market Derivatives processing revenue benefitted from high trading volumes due to increased market volatility Limited revenue impact from SEF regulations YTD 64.2 72.2 +12.5% 34.6 41.9 100 75 50 25 0 Q3 2013 Q3 2014 Revenue Adjusted EBITDA Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% Revenue 72.2 64.2 12.5% 216.4 200.3 8.0% Organic growth - - 9.4% - - 4.8% Adjusted EBITDA 41.9 34.6 21.1% 120.1 108.3 10.9% Adjusted EBITDA margin 58.0% 53.9% - 55.5% 54.1% -
  • 14. 14 Q3 and 9M 2014 financial results Impact of electronic trading on Processing 9M 2014 Processing revenue by asset class ~40% ~60% Loans / FX / Equities Rates / Credit ~30% ~30% Rates / Credit not impacted Rates / Credit impacted Rates / Credit revenue Regulation will introduce trading rules that affect standardized OTC derivatives over the next three years US: CFTC already enacted rules, SEC yet to issue final rules Europe: consultation late 2014 with likely implementation late 2016 or 2017 Asia: various jurisdictions in different stages of implementation Loans / FX / Equities No anticipated material impact from new regulations, low double digit 2014 YTD growth 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 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 EBITDA impact 9M 2014: $216.4 million
  • 15. 15 Q3 and 9M 2014 financial results Solutions ($ million) 58.7 74.1 +26.2% 21.7 24.1 100 75 50 25 0 Q3 2013 Q3 2014 Revenue Adjusted EBITDA Q3 2014 Q3 2013 YoY% 9M 2014 9M 2013 YoY% Revenue 74.1 58.7 26.2% 214.0 161.1 32.8% Organic growth - - 13.1% - - 18.9% Acquisition related - - 12.1% - - 12.8% Adjusted EBITDA 24.1 21.7 11.1% 68.8 55.3 24.4% Adjusted EBITDA margin 32.5% 37.0% - 32.1% 34.3% - Q3 highlights: Double digit organic revenue growth driven by new business wins across Managed Services and Enterprise Software Markit Corporate Actions, thinkFolio, and CTI acquisitions contributed +12.1% to revenue growth Adjusted EBITDA margins lower due to continued investment in growth initiatives
  • 16. 16 Q3 and 9M 2014 financial results Exceptional items ($ million) Q3 2014 Q3 2013 9M 2014 9M 2013 Legal advisory costs (1.1) (1.6) (4.0) (3.8) Impairments (8.3) (12.7) (8.3) (12.7) Profit on sale of available-for-sale financial asset - - - 4.2 IPO preparation and execution costs - - (12.1) - Accelerated IFRS 2 charges - - (7.3) - Recognition of liability for social security costs on option exercise - - (20.1) - Total exceptional items (9.4) (14.3) (51.8) (12.3)
  • 17. 17 Q3 and 9M 2014 financial results Net debt / leverage ($ million) September 30th 2014 December 31st 2013 Bank borrowings 274.3 268.0 Share buyback 235.1 306.6 Total borrowings 509.4 574.6 Cash and cash equivalents (81.1) (75.3) Net debt 428.3 499.3 LTM Adjusted EBITDA(1) 471.9 421.3 Leverage (Net debt/ LTM Adjusted EBITDA) 0.91x 1.19x 1. LTM Adjusted EBITDA is defined as Adjusted EBITDA for the previous twelve month period to date reported Q3 highlights: Net debt down 14.2% or $71.0 million Leverage remains low at 0.91x $88.0 million capital expenditure YTD 2014, down 7.1% or $6.7 million year on year
  • 19. 19 Q3 and 9M 2014 financial results Definitions Revenue growth We measure revenue growth in terms of organic revenue growth, acquisition related revenue growth and foreign currency impact on 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 recognised 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 recognised 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 net other gains or losses 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. LTM Adjusted EBITDA is defined as Adjusted EBITDA for the previous twelve month period from date reported 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, 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.
  • 20. 20 Q3 and 9M 2014 financial results 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 priced at below $26.70 vested on IPO Options priced 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 Surplus cash will be used for general corporate purposes including investment in our business and to pursue acquisitions Three months ended September 30th – Reported (million except share price) 2014 2013 Weighted average number of shares, basic 180.0 175.3 Option dilution 6.9 0.8 Restricted shares dilution 1.0 0.4 Weighted average number of shares, diluted 187.9 176.5 Share price used for Q314 dilution calculation $25.14 - Illustrative weighted average diluted number of shares three months ended September 30th 2014 Illustrative average share price Illustrative diluted average number of shares (million) $23 186.0 $27 189.9 $30 195.6 Total outstanding options at September 30th 2014 Exercise price Outstanding (million) Unvested (million) $15.00 4.8 – $15.00- $19.99 6.1 1.1 $20.00- $26.69 22.3 8.9 $26.69 33.7 33.2 Total 66.9 43.2
  • 21. 21 Q3 and 9M 2014 financial results Reconciliation to Adjusted EBITDA ($ million) Q3 2014 Q3 2013 9M 2014 9M 2013 FY 2013 LTM ended Sep. 2014 Profit for the period 79.2 32.4 148.4 144.1 147.0 151.3 Income tax expense 11.6 16.5 36.8 52.1 63.7 48.4 Finance costs – net 4.5 4.7 12.8 15.0 19.4 17.2 Depreciation and amortisation 25.1 21.9 71.9 62.4 86.0 95.5 Amortisation – acquisition related 15.0 12.6 43.3 37.0 50.1 56.4 Acquisition related items (16.0) 0.1 (11.0) 0.2 (1.4) (12.6) Exceptional items 9.4 14.3 51.8 12.3 60.6 100.1 Share based compensation and related items 0.7 2.0 6.8 5.9 8.1 9.0 Other losses/ (gains) – net (2.4) 6.2 3.0 (4.6) (0.7) 6.9 Adjusted EBITDA attributable to non-controlling interests (0.3) - (0.3) (11.5) (11.5) (0.3) Adjusted EBITDA 126.8 110.7 363.5 312.9 421.3 471.9
  • 22. Q3 2014 Q3 2013 9M 2014 9M 2013 Profit for the period 79.2 32.4 148.4 144.1 Amortisation – acquisition related 15.0 12.6 43.3 37.0 Acquisition related items (16.0) 0.1 (11.0) 0.2 Exceptional items 9.4 14.3 51.8 12.3 Share based compensation and related items 0.7 2.0 6.8 5.9 Other losses/ (gains) – net (2.4) 6.2 3.0 (4.6) 2.9 3.0 7.8 9.8 Tax effect of above adjustments (20.4) (5.9) (40.5) (12.0) Adjusted Earnings attributable to non-controlling interests 0.3 - 0.3 (9.7) Adjusted Earnings 68.7 64.7 209.9 183.0 187,893,323 176,547,638 183,630,386 175,835,360 22 Q3 and 9M 2014 financial results Reconciliation to Adjusted Earnings ($ million) Unwind of discount (1) Weighted average number of shares for computation of earnings per share, diluted 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.