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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Ihs Markit Ltd. | NASDAQ:INFO | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 64.61 | 0.001 | 64.77 | 0 | 01:00:00 |
(Mark One)
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Bermuda
|
001-36495
|
98-1166311
|
(State or Other Jurisdiction of Incorporation or Organization)
|
(Commission File Number)
|
(IRS Employer Identification Number)
|
Title of each class
|
|
Trading Symbol
|
|
Name of each exchange on which registered
|
Common Shares, $0.01 par value per share
|
|
INFO
|
|
New York Stock Exchange
|
|
|
Page
|
|
||
|
||
|
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|
Item 1.
|
Financial Statements
|
|
As of
|
|
As of
|
||||
|
August 31, 2019
|
|
November 30, 2018
|
||||
|
(Unaudited)
|
|
(Audited)
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
124.1
|
|
|
$
|
120.0
|
|
Accounts receivable, net
|
862.7
|
|
|
792.9
|
|
||
Income tax receivable
|
17.8
|
|
|
20.8
|
|
||
Deferred subscription costs
|
72.3
|
|
|
77.3
|
|
||
Other current assets
|
112.1
|
|
|
88.4
|
|
||
Total current assets
|
1,189.0
|
|
|
1,099.4
|
|
||
Non-current assets:
|
|
|
|
||||
Property and equipment, net
|
623.9
|
|
|
579.6
|
|
||
Intangible assets, net
|
4,181.6
|
|
|
4,484.8
|
|
||
Goodwill
|
9,805.2
|
|
|
9,836.0
|
|
||
Deferred income taxes
|
14.6
|
|
|
14.6
|
|
||
Other
|
89.3
|
|
|
47.9
|
|
||
Total non-current assets
|
14,714.6
|
|
|
14,962.9
|
|
||
Total assets
|
$
|
15,903.6
|
|
|
$
|
16,062.3
|
|
Liabilities and equity
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
||||
Short-term debt
|
$
|
1.2
|
|
|
$
|
789.9
|
|
Accounts payable
|
27.2
|
|
|
63.8
|
|
||
Accrued compensation
|
167.0
|
|
|
214.1
|
|
||
Other accrued expenses
|
437.9
|
|
|
357.7
|
|
||
Income tax payable
|
133.5
|
|
|
8.0
|
|
||
Deferred revenue
|
896.5
|
|
|
886.8
|
|
||
Total current liabilities
|
1,663.3
|
|
|
2,320.3
|
|
||
Long-term debt, net
|
5,051.2
|
|
|
4,889.2
|
|
||
Accrued pension and postretirement liability
|
17.0
|
|
|
17.4
|
|
||
Deferred income taxes
|
770.5
|
|
|
699.9
|
|
||
Other liabilities
|
150.7
|
|
|
109.1
|
|
||
Commitments and contingencies
|
|
|
|
||||
Redeemable noncontrolling interests
|
15.9
|
|
|
5.9
|
|
||
Shareholders' equity:
|
|
|
|
||||
Common shares, $0.01 par value, 3,000.0 authorized, 475.9 and 472.9 issued, and 401.0 and 397.1 outstanding at August 31, 2019 and November 30, 2018, respectively
|
4.8
|
|
|
4.7
|
|
||
Additional paid-in capital
|
7,745.6
|
|
|
7,680.4
|
|
||
Treasury shares, at cost: 74.9 and 75.8 at August 31, 2019 and November 30, 2018, respectively
|
(2,151.5
|
)
|
|
(2,108.8
|
)
|
||
Retained earnings
|
3,094.7
|
|
|
2,743.1
|
|
||
Accumulated other comprehensive loss
|
(458.6
|
)
|
|
(298.9
|
)
|
||
Total shareholders' equity
|
8,235.0
|
|
|
8,020.5
|
|
||
Total liabilities and equity
|
$
|
15,903.6
|
|
|
$
|
16,062.3
|
|
|
Three months ended August 31,
|
|
Nine months ended August 31,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue
|
$
|
1,112.3
|
|
|
$
|
1,001.0
|
|
|
$
|
3,294.2
|
|
|
$
|
2,941.4
|
|
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
419.7
|
|
|
375.3
|
|
|
1,247.5
|
|
|
1,086.6
|
|
||||
Selling, general and administrative
|
295.4
|
|
|
287.7
|
|
|
889.0
|
|
|
877.2
|
|
||||
Depreciation and amortization
|
144.7
|
|
|
134.1
|
|
|
431.0
|
|
|
395.7
|
|
||||
Restructuring charges
|
1.1
|
|
|
0.4
|
|
|
11.0
|
|
|
0.4
|
|
||||
Acquisition-related costs
|
23.4
|
|
|
41.7
|
|
|
67.6
|
|
|
94.5
|
|
||||
Other (income) expense, net
|
(114.8
|
)
|
|
1.5
|
|
|
(108.4
|
)
|
|
5.9
|
|
||||
Total operating expenses
|
769.5
|
|
|
840.7
|
|
|
2,537.7
|
|
|
2,460.3
|
|
||||
Operating income
|
342.8
|
|
|
160.3
|
|
|
756.5
|
|
|
481.1
|
|
||||
Interest income
|
0.6
|
|
|
0.9
|
|
|
1.6
|
|
|
2.5
|
|
||||
Interest expense
|
(63.2
|
)
|
|
(56.7
|
)
|
|
(195.9
|
)
|
|
(158.3
|
)
|
||||
Net periodic pension and postretirement (expense) income
|
(0.2
|
)
|
|
7.1
|
|
|
(0.7
|
)
|
|
6.6
|
|
||||
Non-operating expense, net
|
(62.8
|
)
|
|
(48.7
|
)
|
|
(195.0
|
)
|
|
(149.2
|
)
|
||||
Income from continuing operations before income taxes and equity in loss of equity method investee
|
280.0
|
|
|
111.6
|
|
|
561.5
|
|
|
331.9
|
|
||||
(Provision) benefit for income taxes
|
(240.6
|
)
|
|
(7.9
|
)
|
|
(263.9
|
)
|
|
126.7
|
|
||||
Equity in loss of equity method investee
|
(0.2
|
)
|
|
(0.2
|
)
|
|
(0.5
|
)
|
|
(0.2
|
)
|
||||
Net income
|
39.2
|
|
|
103.5
|
|
|
297.1
|
|
|
458.4
|
|
||||
Net loss attributable to noncontrolling interest
|
0.9
|
|
|
1.0
|
|
|
2.5
|
|
|
2.1
|
|
||||
Net income attributable to IHS Markit Ltd.
|
$
|
40.1
|
|
|
$
|
104.5
|
|
|
$
|
299.6
|
|
|
$
|
460.5
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share attributable to IHS Markit Ltd.
|
$
|
0.10
|
|
|
$
|
0.26
|
|
|
$
|
0.75
|
|
|
$
|
1.17
|
|
Weighted average shares used in computing basic earnings per share
|
401.2
|
|
|
393.0
|
|
|
399.9
|
|
|
394.2
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share attributable to IHS Markit Ltd.
|
$
|
0.10
|
|
|
$
|
0.26
|
|
|
$
|
0.73
|
|
|
$
|
1.13
|
|
Weighted average shares used in computing diluted earnings per share
|
410.9
|
|
|
405.1
|
|
|
409.4
|
|
|
406.8
|
|
|
|
Three months ended August 31,
|
|
Nine months ended August 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
|
$
|
39.2
|
|
|
$
|
103.5
|
|
|
$
|
297.1
|
|
|
$
|
458.4
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Net hedging activities (1)
|
|
(0.7
|
)
|
|
0.9
|
|
|
(4.1
|
)
|
|
6.7
|
|
||||
Net pension liability adjustment (2)
|
|
—
|
|
|
0.6
|
|
|
—
|
|
|
0.6
|
|
||||
Foreign currency translation adjustment
|
|
(115.6
|
)
|
|
(78.5
|
)
|
|
(155.6
|
)
|
|
(137.0
|
)
|
||||
Total other comprehensive loss
|
|
(116.3
|
)
|
|
(77.0
|
)
|
|
(159.7
|
)
|
|
(129.7
|
)
|
||||
Comprehensive (loss) income
|
|
$
|
(77.1
|
)
|
|
$
|
26.5
|
|
|
$
|
137.4
|
|
|
$
|
328.7
|
|
Comprehensive loss attributable to noncontrolling interest
|
|
0.9
|
|
|
1.0
|
|
|
2.5
|
|
|
2.1
|
|
||||
Comprehensive (loss) income attributable to IHS Markit Ltd.
|
|
$
|
(76.2
|
)
|
|
$
|
27.5
|
|
|
$
|
139.9
|
|
|
$
|
330.8
|
|
(1) Net of tax benefit (expense) of $0.1 million; $(0.2) million; $0.9 million, and $(1.6) million for the three and nine months ended August 31, 2019 and 2018, respectively.
|
||||||||||||||||
(2) Net of tax expense of $0.2 million for the three and nine months ended August 31, 2018.
|
|
Nine months ended August 31,
|
||||||
|
2019
|
|
2018
|
||||
Operating activities:
|
|
|
|
||||
Net income
|
$
|
297.1
|
|
|
$
|
458.4
|
|
Reconciliation of net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
431.0
|
|
|
395.7
|
|
||
Stock-based compensation expense
|
167.3
|
|
|
172.1
|
|
||
Gain on sale of assets
|
(113.0
|
)
|
|
—
|
|
||
Net periodic pension and postretirement expense
|
0.7
|
|
|
(6.6
|
)
|
||
Undistributed earnings of affiliates, net
|
0.2
|
|
|
—
|
|
||
Pension and postretirement contributions
|
(1.1
|
)
|
|
(2.2
|
)
|
||
Deferred income taxes
|
109.9
|
|
|
(203.2
|
)
|
||
Change in assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
(17.5
|
)
|
|
27.9
|
|
||
Other current assets
|
(52.7
|
)
|
|
(14.1
|
)
|
||
Accounts payable
|
(14.5
|
)
|
|
(13.3
|
)
|
||
Accrued expenses
|
10.2
|
|
|
(10.4
|
)
|
||
Income tax
|
106.6
|
|
|
34.0
|
|
||
Deferred revenue
|
39.0
|
|
|
33.4
|
|
||
Other liabilities
|
62.4
|
|
|
60.3
|
|
||
Net cash provided by operating activities
|
1,025.6
|
|
|
932.0
|
|
||
Investing activities:
|
|
|
|
||||
Capital expenditures on property and equipment
|
(199.9
|
)
|
|
(168.5
|
)
|
||
Acquisitions of businesses, net of cash acquired
|
(128.4
|
)
|
|
(1,881.4
|
)
|
||
Proceeds from sale of assets
|
159.2
|
|
|
—
|
|
||
Change in other assets
|
(9.3
|
)
|
|
(7.4
|
)
|
||
Settlements of forward contracts
|
(28.1
|
)
|
|
(6.9
|
)
|
||
Net cash used in investing activities
|
(206.5
|
)
|
|
(2,064.2
|
)
|
||
Financing activities:
|
|
|
|
||||
Proceeds from borrowings
|
1,984.9
|
|
|
4,599.9
|
|
||
Repayment of borrowings
|
(2,613.0
|
)
|
|
(2,721.6
|
)
|
||
Payment of debt issuance costs
|
(12.3
|
)
|
|
(30.9
|
)
|
||
Payments for purchase of noncontrolling interests
|
—
|
|
|
(7.7
|
)
|
||
Proceeds from noncontrolling interests
|
12.5
|
|
|
—
|
|
||
Contingent consideration payments
|
(2.2
|
)
|
|
(43.0
|
)
|
||
Proceeds from the exercise of employee stock options
|
134.1
|
|
|
162.4
|
|
||
Payments related to tax withholding for stock-based compensation
|
(65.9
|
)
|
|
(85.6
|
)
|
||
Repurchases of common shares
|
(200.0
|
)
|
|
(672.5
|
)
|
||
Net cash (used in) provided by financing activities
|
(761.9
|
)
|
|
1,201.0
|
|
||
Foreign exchange impact on cash balance
|
(53.1
|
)
|
|
(48.2
|
)
|
||
Net increase in cash and cash equivalents
|
4.1
|
|
|
20.6
|
|
||
Cash and cash equivalents at the beginning of the period
|
120.0
|
|
|
133.8
|
|
||
Cash and cash equivalents at the end of the period
|
$
|
124.1
|
|
|
$
|
154.4
|
|
|
Common Shares
|
|
Additional
Paid-In
Capital
|
|
|
|
|
|
Accumulated Other
Comprehensive
Loss
|
|
Total Shareholders’ Equity
|
|
|
Redeemable Noncontrolling Interests
|
|||||||||||||||||
|
Shares Outstanding
|
|
Amount
|
|
|
Treasury
Shares
|
|
Retained
Earnings
|
|
|
|
|
|||||||||||||||||||
Balance at November 30, 2017 (Audited)
|
399.2
|
|
|
$
|
4.7
|
|
|
$
|
7,612.1
|
|
|
$
|
(1,745.0
|
)
|
|
$
|
2,217.6
|
|
|
$
|
(85.0
|
)
|
|
$
|
8,004.4
|
|
|
|
$
|
19.1
|
|
Repurchases of common shares
|
(3.9
|
)
|
|
|
|
|
|
(172.5
|
)
|
|
|
|
|
|
(172.5
|
)
|
|
|
|
||||||||||||
Share-based award activity
|
2.1
|
|
|
|
|
(56.8
|
)
|
|
28.2
|
|
|
|
|
|
|
(28.6
|
)
|
|
|
|
|||||||||||
Option exercises
|
2.4
|
|
|
|
|
56.5
|
|
|
|
|
|
|
|
|
56.5
|
|
|
|
|
||||||||||||
Net income (loss)
|
|
|
|
|
|
|
|
|
241.3
|
|
|
|
|
241.3
|
|
|
|
(0.6
|
)
|
||||||||||||
Impact of the Tax Cuts and Jobs Act of 2017
|
|
|
|
|
|
|
|
|
5.9
|
|
|
(5.9
|
)
|
|
—
|
|
|
|
|
||||||||||||
Purchase of noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
(10.1
|
)
|
|||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
61.2
|
|
|
61.2
|
|
|
|
|
|||||||||||||
Balance at February 28, 2018
|
399.8
|
|
|
4.7
|
|
|
7,611.8
|
|
|
(1,889.3
|
)
|
|
2,464.8
|
|
|
(29.7
|
)
|
|
8,162.3
|
|
|
|
8.4
|
|
|||||||
Repurchases of common shares
|
(10.3
|
)
|
|
—
|
|
|
—
|
|
|
(500.0
|
)
|
|
—
|
|
|
—
|
|
|
(500.0
|
)
|
|
|
—
|
|
|||||||
Share-based award activity
|
—
|
|
|
—
|
|
|
(49.1
|
)
|
|
100.1
|
|
|
—
|
|
|
—
|
|
|
51.0
|
|
|
|
—
|
|
|||||||
Option exercises
|
2.5
|
|
|
—
|
|
|
54.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
54.6
|
|
|
|
—
|
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
114.7
|
|
|
—
|
|
|
114.7
|
|
|
|
(0.5
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(113.9
|
)
|
|
(113.9
|
)
|
|
|
—
|
|
|||||||
Balance at May 31, 2018
|
392.0
|
|
|
$
|
4.7
|
|
|
$
|
7,617.3
|
|
|
$
|
(2,289.2
|
)
|
|
$
|
2,579.5
|
|
|
$
|
(143.6
|
)
|
|
$
|
7,768.7
|
|
|
|
$
|
7.9
|
|
Repurchases of common shares
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|||||||||
Share-based award activity
|
0.2
|
|
|
—
|
|
|
(35.6
|
)
|
|
78.5
|
|
|
—
|
|
|
—
|
|
|
42.9
|
|
|
|
—
|
|
|||||||
Option exercises
|
2.0
|
|
|
—
|
|
|
52.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52.5
|
|
|
|
—
|
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
104.5
|
|
|
—
|
|
|
104.5
|
|
|
|
(1.0
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(77.0
|
)
|
|
(77.0
|
)
|
|
|
—
|
|
|||||||
Balance at August 31, 2018
|
394.2
|
|
|
$
|
4.7
|
|
|
$
|
7,634.2
|
|
|
$
|
(2,210.7
|
)
|
|
$
|
2,684.0
|
|
|
$
|
(220.6
|
)
|
|
$
|
7,891.6
|
|
|
|
$
|
6.9
|
|
|
Common Shares
|
|
Additional
Paid-In
Capital
|
|
|
|
|
|
Accumulated Other
Comprehensive
Loss
|
|
Total Shareholders’ Equity
|
|
|
Redeemable Noncontrolling Interests
|
|||||||||||||||||
|
Shares Outstanding
|
|
Amount
|
|
|
Treasury
Shares
|
|
Retained
Earnings
|
|
|
|
|
|||||||||||||||||||
Balance at November 30, 2018 (Audited)
|
397.1
|
|
|
$
|
4.7
|
|
|
$
|
7,680.4
|
|
|
$
|
(2,108.8
|
)
|
|
$
|
2,743.1
|
|
|
$
|
(298.9
|
)
|
|
$
|
8,020.5
|
|
|
|
$
|
5.9
|
|
Adjustment to opening retained earnings related to adoption of ASC Topic 606
|
|
|
|
|
|
|
|
|
56.0
|
|
|
|
|
56.0
|
|
|
|
|
|||||||||||||
Share-based award activity
|
1.7
|
|
|
0.1
|
|
|
8.5
|
|
|
(18.0
|
)
|
|
(2.4
|
)
|
|
|
|
(11.8
|
)
|
|
|
|
|||||||||
Option exercises
|
0.9
|
|
|
|
|
23.7
|
|
|
|
|
|
|
|
|
23.7
|
|
|
|
|
||||||||||||
Net income (loss)
|
|
|
|
|
|
|
|
|
109.7
|
|
|
|
|
109.7
|
|
|
|
(0.7
|
)
|
||||||||||||
Issuance of noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
12.5
|
|
|||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
134.2
|
|
|
134.2
|
|
|
|
|
|||||||||||||
Balance at February 28, 2019
|
399.7
|
|
|
4.8
|
|
|
7,712.6
|
|
|
(2,126.8
|
)
|
|
2,906.4
|
|
|
(164.7
|
)
|
|
8,332.3
|
|
|
|
17.7
|
|
|||||||
Share-based award activity
|
0.2
|
|
|
—
|
|
|
0.5
|
|
|
50.5
|
|
|
(1.4
|
)
|
|
—
|
|
|
49.6
|
|
|
|
—
|
|
|||||||
Option exercises
|
1.2
|
|
|
—
|
|
|
32.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32.3
|
|
|
|
—
|
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
149.8
|
|
|
—
|
|
|
149.8
|
|
|
|
(0.9
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(177.6
|
)
|
|
(177.6
|
)
|
|
|
—
|
|
|||||||
Balance at May 31, 2019
|
401.1
|
|
|
$
|
4.8
|
|
|
$
|
7,745.4
|
|
|
$
|
(2,076.3
|
)
|
|
$
|
3,054.8
|
|
|
$
|
(342.3
|
)
|
|
$
|
8,386.4
|
|
|
|
$
|
16.8
|
|
Repurchases of common shares
|
(3.1
|
)
|
|
—
|
|
|
—
|
|
|
(200.0
|
)
|
|
—
|
|
|
—
|
|
|
(200.0
|
)
|
|
|
—
|
|
|||||||
Share-based award activity
|
—
|
|
|
—
|
|
|
(79.3
|
)
|
|
124.8
|
|
|
(0.2
|
)
|
|
—
|
|
|
45.3
|
|
|
|
—
|
|
|||||||
Option exercises
|
3.0
|
|
|
—
|
|
|
79.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
79.5
|
|
|
|
—
|
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40.1
|
|
|
—
|
|
|
40.1
|
|
|
|
(0.9
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(116.3
|
)
|
|
(116.3
|
)
|
|
|
—
|
|
|||||||
Balance at August 31, 2019
|
401.0
|
|
|
$
|
4.8
|
|
|
$
|
7,745.6
|
|
|
$
|
(2,151.5
|
)
|
|
$
|
3,094.7
|
|
|
$
|
(458.6
|
)
|
|
$
|
8,235.0
|
|
|
|
$
|
15.9
|
|
1.
|
Basis of Presentation and Significant Accounting Policies
|
|
November 30, 2018
|
|
Adjustments due to adoption of ASC Topic 606
|
|
December 1, 2018
|
||||||
Accounts receivable, net
|
$
|
792.9
|
|
|
$
|
29.8
|
|
|
$
|
822.7
|
|
Other current assets
|
88.4
|
|
|
4.2
|
|
|
92.6
|
|
|||
Other non-current assets
|
47.9
|
|
|
9.5
|
|
|
57.4
|
|
|||
Deferred revenue
|
886.8
|
|
|
(28.8
|
)
|
|
858.0
|
|
|||
Deferred income taxes
|
699.9
|
|
|
16.3
|
|
|
716.2
|
|
|||
Retained earnings
|
2,743.1
|
|
|
56.0
|
|
|
2,799.1
|
|
•
|
Recurring fixed revenue represents revenue generated from contracts specifying a relatively fixed fee for services delivered over the life of the contract. The fixed fee is typically paid annually or more periodically in advance. These contracts typically consist of subscriptions to our various information offerings and software maintenance, which provide continuous access to our platforms and associated data over the contract term. The revenue is usually recognized ratably over the contract term or for term-based software license arrangements, annually on renewal. The initial term of these contracts is typically annual (with some longer-term arrangements) and non-cancellable for the term of the subscription and may contain provisions for minimum monthly payments.
|
•
|
Recurring variable revenue represents revenue from contracts that specify a fee for services, which is typically not fixed. The variable fee is usually 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, and revenue is recognized based on the specific factor used (e.g., for usage-based contracts, we recognize revenue in line with usage in the period). Many of these contracts do not have a maturity date, while the remainder have an initial term ranging from one to five years. Recurring variable revenue was derived entirely from the Financial Services segment for all periods presented.
|
•
|
Non-recurring revenue represents consulting (e.g., research and analysis, modeling, and forecasting), services, single-document product sales, perpetual license sales and associated services, conferences and events, and advertising. Revenue for services and other non-recurring revenue is recognized upon completion of the associated performance obligation.
|
|
Three months ended August 31,
|
|
Nine months ended August 31,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Recurring fixed revenue
|
$
|
799.9
|
|
|
$
|
717.7
|
|
|
$
|
2,352.3
|
|
|
$
|
2,099.1
|
|
Recurring variable revenue
|
144.4
|
|
|
124.8
|
|
|
425.4
|
|
|
367.8
|
|
||||
Non-recurring revenue
|
168.0
|
|
|
158.5
|
|
|
516.5
|
|
|
474.5
|
|
||||
Total revenue
|
$
|
1,112.3
|
|
|
$
|
1,001.0
|
|
|
$
|
3,294.2
|
|
|
$
|
2,941.4
|
|
2.
|
Business Combinations and Divestitures
|
|
Total
|
||
Assets:
|
|
||
Current assets
|
$
|
10.2
|
|
Property and equipment
|
0.6
|
|
|
Intangible assets
|
55.4
|
|
|
Goodwill
|
86.0
|
|
|
Total assets
|
152.2
|
|
|
Liabilities:
|
|
||
Current liabilities
|
2.2
|
|
|
Deferred revenue
|
12.2
|
|
|
Deferred taxes
|
9.4
|
|
|
Total liabilities
|
23.8
|
|
|
Purchase price
|
$
|
128.4
|
|
Current assets
|
$
|
10.3
|
|
Property and equipment
|
$
|
0.9
|
|
Intangible assets
|
$
|
14.1
|
|
Goodwill
|
$
|
33.4
|
|
Current liabilities
|
$
|
(0.8
|
)
|
Deferred revenue
|
$
|
(21.5
|
)
|
3.
|
Intangible Assets
|
|
As of August 31, 2019
|
|
As of November 30, 2018
|
||||||||||||||||||||
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Intangible assets subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Information databases
|
$
|
623.8
|
|
|
$
|
(330.8
|
)
|
|
$
|
293.0
|
|
|
$
|
671.0
|
|
|
$
|
(329.6
|
)
|
|
$
|
341.4
|
|
Customer relationships
|
3,427.9
|
|
|
(592.9
|
)
|
|
2,835.0
|
|
|
3,458.8
|
|
|
(473.3
|
)
|
|
2,985.5
|
|
||||||
Developed technology
|
923.4
|
|
|
(185.6
|
)
|
|
737.8
|
|
|
928.8
|
|
|
(133.1
|
)
|
|
795.7
|
|
||||||
Developed computer software
|
85.0
|
|
|
(69.7
|
)
|
|
15.3
|
|
|
85.0
|
|
|
(63.0
|
)
|
|
22.0
|
|
||||||
Trademarks
|
494.5
|
|
|
(194.0
|
)
|
|
300.5
|
|
|
493.8
|
|
|
(153.6
|
)
|
|
340.2
|
|
||||||
Other
|
1.1
|
|
|
(1.1
|
)
|
|
—
|
|
|
1.1
|
|
|
(1.1
|
)
|
|
—
|
|
||||||
Total intangible assets
|
$
|
5,555.7
|
|
|
$
|
(1,374.1
|
)
|
|
$
|
4,181.6
|
|
|
$
|
5,638.5
|
|
|
$
|
(1,153.7
|
)
|
|
$
|
4,484.8
|
|
Year
|
|
Amount
|
||
Remainder of 2019
|
|
$
|
92.8
|
|
2020
|
|
$
|
368.6
|
|
2021
|
|
$
|
363.8
|
|
2022
|
|
$
|
345.3
|
|
2023
|
|
$
|
334.2
|
|
Thereafter
|
|
$
|
2,676.9
|
|
4.
|
Debt
|
|
|
August 31, 2019
|
|
November 30, 2018
|
||||
2018 revolving facility
|
|
$
|
413.0
|
|
|
$
|
1,108.0
|
|
2018 term loan:
|
|
|
|
|
||||
Tranche A-1
|
|
—
|
|
|
574.0
|
|
||
Tranche A-2
|
|
—
|
|
|
481.3
|
|
||
364-day credit agreement
|
|
—
|
|
|
250.0
|
|
||
5.00% senior notes due 2022
|
|
750.0
|
|
|
750.0
|
|
||
4.125% senior notes due 2023
|
|
498.9
|
|
|
498.6
|
|
||
3.625% senior notes due 2024
|
|
398.9
|
|
|
—
|
|
||
4.75% senior notes due 2025
|
|
812.3
|
|
|
813.8
|
|
||
4.00% senior notes due 2026
|
|
500.0
|
|
|
500.0
|
|
||
4.75% senior notes due 2028
|
|
747.5
|
|
|
747.3
|
|
||
4.25% senior notes due 2029
|
|
974.8
|
|
|
—
|
|
||
Debt issuance costs
|
|
(50.0
|
)
|
|
(51.2
|
)
|
||
Capital leases
|
|
7.0
|
|
|
7.3
|
|
||
Total debt
|
|
$
|
5,052.4
|
|
|
$
|
5,679.1
|
|
Current portion
|
|
(1.2
|
)
|
|
(789.9
|
)
|
||
Total long-term debt
|
|
$
|
5,051.2
|
|
|
$
|
4,889.2
|
|
5.
|
Derivatives
|
6.
|
Acquisition-related Costs
|
|
Employee
Severance and
Other
Termination
Benefits
|
|
Contract
Termination
Costs
|
|
Other
|
|
Total
|
||||||||
Balance at November 30, 2018
|
$
|
2.5
|
|
|
$
|
16.8
|
|
|
$
|
68.7
|
|
|
$
|
88.0
|
|
Add: Costs incurred
|
3.8
|
|
|
—
|
|
|
66.0
|
|
|
69.8
|
|
||||
Revision to prior estimates
|
—
|
|
|
(0.2
|
)
|
|
(2.0
|
)
|
|
(2.2
|
)
|
||||
Less: Amount paid
|
(6.3
|
)
|
|
(8.9
|
)
|
|
(13.8
|
)
|
|
(29.0
|
)
|
||||
Balance at August 31, 2019
|
$
|
—
|
|
|
$
|
7.7
|
|
|
$
|
118.9
|
|
|
$
|
126.6
|
|
7.
|
Stock-based Compensation
|
|
Three months ended August 31,
|
|
Nine months ended August 31,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Cost of revenue
|
$
|
15.6
|
|
|
$
|
15.2
|
|
|
$
|
48.5
|
|
|
$
|
49.9
|
|
Selling, general and administrative
|
38.4
|
|
|
37.3
|
|
|
118.8
|
|
|
122.2
|
|
||||
Total stock-based compensation expense
|
$
|
54.0
|
|
|
$
|
52.5
|
|
|
$
|
167.3
|
|
|
$
|
172.1
|
|
|
Shares
|
|
Weighted-
Average Grant Date Fair Value |
|||
|
(in millions)
|
|
|
|||
Balance at November 30, 2018
|
8.8
|
|
|
$
|
41.77
|
|
Granted
|
3.1
|
|
|
$
|
52.98
|
|
Vested
|
(3.5
|
)
|
|
$
|
38.44
|
|
Forfeited
|
(0.4
|
)
|
|
$
|
47.50
|
|
Balance at August 31, 2019
|
8.0
|
|
|
$
|
47.36
|
|
|
Shares
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value
|
||||
|
(in millions)
|
|
|
|
(in years)
|
|
(in millions)
|
||||
Balance at November 30, 2018
|
15.7
|
|
|
$
|
26.61
|
|
|
|
|
|
|
Exercised
|
(5.2
|
)
|
|
$
|
26.31
|
|
|
|
|
|
|
Forfeited
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
Balance at August 31, 2019
|
10.5
|
|
|
$
|
26.76
|
|
|
1.1
|
|
408.6
|
|
Vested and expected to vest at August 31, 2019
|
10.5
|
|
|
$
|
26.76
|
|
|
1.1
|
|
408.4
|
|
Exercisable at August 31, 2019
|
10.0
|
|
|
$
|
26.67
|
|
|
1.0
|
|
390.3
|
|
8.
|
Income Taxes
|
9.
|
Commitments and Contingencies
|
10.
|
Common Shares and Earnings per Share
|
|
Three months ended August 31,
|
|
Nine months ended August 31,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
||||
Shares used in basic EPS calculation
|
401.2
|
|
|
393.0
|
|
|
399.9
|
|
|
394.2
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||
RSUs/RSAs
|
2.9
|
|
|
3.1
|
|
|
2.5
|
|
|
3.3
|
|
Stock options
|
6.8
|
|
|
9.0
|
|
|
7.0
|
|
|
9.3
|
|
Shares used in diluted EPS calculation
|
410.9
|
|
|
405.1
|
|
|
409.4
|
|
|
406.8
|
|
11.
|
Accumulated Other Comprehensive Income (Loss)
|
|
|
Foreign currency translation
|
|
Net pension and OPEB liability
|
|
Unrealized losses on hedging activities
|
|
Total
|
||||||||
Balance at November 30, 2017
|
|
$
|
(68.1
|
)
|
|
$
|
(13.0
|
)
|
|
$
|
(3.9
|
)
|
|
$
|
(85.0
|
)
|
Other comprehensive income before reclassifications
|
|
56.4
|
|
|
—
|
|
|
3.6
|
|
|
60.0
|
|
||||
Reclassifications from AOCI to income
|
|
—
|
|
|
—
|
|
|
1.2
|
|
|
1.2
|
|
||||
Reclassifications from AOCI to retained earnings
|
|
—
|
|
|
(1.7
|
)
|
|
(4.2
|
)
|
|
(5.9
|
)
|
||||
Balance at February 28, 2018
|
|
$
|
(11.7
|
)
|
|
$
|
(14.7
|
)
|
|
$
|
(3.3
|
)
|
|
$
|
(29.7
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
(114.9
|
)
|
|
—
|
|
|
0.2
|
|
|
(114.7
|
)
|
||||
Reclassifications from AOCI to income
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|
0.8
|
|
||||
Balance at May 31, 2018
|
|
$
|
(126.6
|
)
|
|
$
|
(14.7
|
)
|
|
$
|
(2.3
|
)
|
|
$
|
(143.6
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
(78.5
|
)
|
|
0.6
|
|
|
0.5
|
|
|
(77.4
|
)
|
||||
Reclassifications from AOCI to income
|
|
—
|
|
|
—
|
|
|
0.4
|
|
|
0.4
|
|
||||
Balance at August 31, 2018
|
|
$
|
(205.1
|
)
|
|
$
|
(14.1
|
)
|
|
$
|
(1.4
|
)
|
|
$
|
(220.6
|
)
|
|
|
Foreign currency translation
|
|
Net pension and OPEB liability
|
|
Unrealized losses on hedging activities
|
|
Total
|
||||||||
Balance at November 30, 2018
|
|
$
|
(288.5
|
)
|
|
$
|
(9.9
|
)
|
|
$
|
(0.5
|
)
|
|
$
|
(298.9
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
135.7
|
|
|
—
|
|
|
(1.7
|
)
|
|
134.0
|
|
||||
Reclassifications from AOCI to income
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.2
|
|
||||
Balance at February 28, 2019
|
|
$
|
(152.8
|
)
|
|
$
|
(9.9
|
)
|
|
$
|
(2.0
|
)
|
|
$
|
(164.7
|
)
|
Other comprehensive loss
|
|
(175.7
|
)
|
|
—
|
|
|
(1.9
|
)
|
|
(177.6
|
)
|
||||
Balance at May 31, 2019
|
|
$
|
(328.5
|
)
|
|
$
|
(9.9
|
)
|
|
$
|
(3.9
|
)
|
|
$
|
(342.3
|
)
|
Other comprehensive loss
|
|
(115.6
|
)
|
|
—
|
|
|
(1.0
|
)
|
|
(116.6
|
)
|
||||
Reclassifications from AOCI to income
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
0.3
|
|
||||
Balance at August 31, 2019
|
|
$
|
(444.1
|
)
|
|
$
|
(9.9
|
)
|
|
$
|
(4.6
|
)
|
|
$
|
(458.6
|
)
|
12.
|
Segment Information
|
|
Three months ended August 31,
|
|
Nine months ended August 31,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Resources
|
$
|
230.0
|
|
|
$
|
211.5
|
|
|
$
|
696.2
|
|
|
$
|
653.8
|
|
Transportation
|
314.9
|
|
|
297.0
|
|
|
921.6
|
|
|
862.9
|
|
||||
CMS
|
138.6
|
|
|
137.3
|
|
|
405.5
|
|
|
413.8
|
|
||||
Financial Services
|
428.8
|
|
|
355.2
|
|
|
1,270.9
|
|
|
1,010.9
|
|
||||
Total revenue
|
$
|
1,112.3
|
|
|
$
|
1,001.0
|
|
|
$
|
3,294.2
|
|
|
$
|
2,941.4
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA
|
|
|
|
|
|
|
|
||||||||
Resources
|
$
|
100.8
|
|
|
$
|
85.1
|
|
|
$
|
303.2
|
|
|
$
|
270.5
|
|
Transportation
|
134.2
|
|
|
128.1
|
|
|
385.1
|
|
|
362.5
|
|
||||
CMS
|
31.1
|
|
|
30.3
|
|
|
89.8
|
|
|
92.0
|
|
||||
Financial Services
|
199.1
|
|
|
156.3
|
|
|
587.9
|
|
|
457.5
|
|
||||
Shared services
|
(12.3
|
)
|
|
(9.3
|
)
|
|
(40.0
|
)
|
|
(34.6
|
)
|
||||
Total Adjusted EBITDA
|
$
|
452.9
|
|
|
$
|
390.5
|
|
|
$
|
1,326.0
|
|
|
$
|
1,147.9
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation to the consolidated statements of operations:
|
|
|
|
|
|
|
|
||||||||
Interest income
|
0.6
|
|
|
0.9
|
|
|
1.6
|
|
|
2.5
|
|
||||
Interest expense
|
(63.2
|
)
|
|
(56.7
|
)
|
|
(195.9
|
)
|
|
(158.3
|
)
|
||||
(Provision) benefit for income taxes
|
(240.6
|
)
|
|
(7.9
|
)
|
|
(263.9
|
)
|
|
126.7
|
|
||||
Depreciation
|
(51.5
|
)
|
|
(45.0
|
)
|
|
(147.5
|
)
|
|
(129.0
|
)
|
||||
Amortization related to acquired intangible assets
|
(93.2
|
)
|
|
(89.1
|
)
|
|
(283.5
|
)
|
|
(266.7
|
)
|
||||
Stock-based compensation expense
|
(54.0
|
)
|
|
(52.5
|
)
|
|
(167.3
|
)
|
|
(172.1
|
)
|
||||
Restructuring charges
|
(1.1
|
)
|
|
(0.4
|
)
|
|
(11.0
|
)
|
|
(0.4
|
)
|
||||
Acquisition-related costs
|
(8.1
|
)
|
|
(30.2
|
)
|
|
(21.6
|
)
|
|
(57.4
|
)
|
||||
Acquisition-related performance compensation
|
(15.3
|
)
|
|
(11.5
|
)
|
|
(46.0
|
)
|
|
(37.1
|
)
|
||||
Loss on debt extinguishment
|
—
|
|
|
(1.7
|
)
|
|
(6.0
|
)
|
|
(4.7
|
)
|
||||
Gain on sale of assets
|
113.0
|
|
|
—
|
|
|
113.0
|
|
|
—
|
|
||||
Pension mark-to-market and settlement gain (expense)
|
—
|
|
|
7.3
|
|
|
—
|
|
|
7.3
|
|
||||
Share of joint venture results not attributable to Adjusted EBITDA
|
(0.2
|
)
|
|
(0.2
|
)
|
|
(0.5
|
)
|
|
(0.2
|
)
|
||||
Adjusted EBITDA attributable to noncontrolling interest
|
0.8
|
|
|
1.0
|
|
|
2.2
|
|
|
2.0
|
|
||||
Net income attributable to IHS Markit Ltd.
|
$
|
40.1
|
|
|
$
|
104.5
|
|
|
$
|
299.6
|
|
|
$
|
460.5
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Transportation, which includes our Automotive; Maritime & Trade; and Aerospace, Defense & Security product offerings;
|
•
|
Consolidated Markets & Solutions, which includes our Product Design; Economics & Country Risk (“ECR”), and our Technology, Media, & Telecom (“TMT”) benchmarking product offerings; and
|
•
|
Financial Services, which includes our financial Information, Processing, and Solutions product offerings, as well as our product offerings from Ipreo.
|
•
|
Increase in geographic, product, and customer penetration. We believe that there are continued opportunities to add new customers and to increase the use of our products and services by existing customers. We plan to add new customers and build our relationships with existing customers by leveraging our existing sales channels, broad product portfolio, global footprint, and industry expertise to anticipate and respond to the changing demands of our end markets.
|
•
|
Introduce innovative offerings and enhancements. In recent years, we have launched several new product offerings addressing a wide array of customer needs, and we expect to continue to innovate using our existing data sets and industry expertise, converting core information to higher value advanced analytics. Our investment priorities are primarily in energy, automotive, and financial services, and we intend to continue to invest across our business to increase our customer value proposition.
|
•
|
Balance capital allocation. As part of our capital allocation focus for the majority of 2019, we have de-levered to our capital policy target leverage ratio of 2.0-3.0x. Over the long term, we expect to balance capital allocation between returning capital to shareholders (through share repurchases and dividends) and completing mergers and acquisitions, focused primarily on targeted transactions in our core end markets that will allow us to continue to build out our strategic position.
|
•
|
Organic – We define organic revenue growth as total revenue growth from continuing operations for all factors other than acquisitions and foreign currency movements. We drive this type of revenue growth through value realization (pricing), expanding wallet share of existing customers through up-selling and cross-selling efforts, securing new customer business, and through the sale of new or enhanced product offerings.
|
•
|
Acquisitive – We define acquisitive revenue as the revenue generated from acquired products and services from the date of acquisition to the first anniversary date of that acquisition. This type of growth comes as a result of our strategy to purchase, integrate, and leverage the value of assets we acquire. We also include the impact of divestitures in this metric.
|
•
|
Foreign currency – We define the foreign currency impact on revenue as the difference between current revenue at current exchange rates and current revenue at the corresponding prior period exchange rates. Due to the significance of revenue transacted in foreign currencies, we believe that it is important to measure the impact of foreign currency movements on revenue.
|
•
|
Recurring fixed revenue represents revenue generated from contracts specifying a relatively fixed fee for services delivered over the life of the contract. The fixed fee is typically paid annually or more periodically in advance. These contracts typically consist of subscriptions to our various information offerings and software maintenance, which provide continuous access to our platforms and associated data over the contract term. The revenue is usually recognized ratably over the contract term or for term-based software license arrangements, annually on renewal. The initial term of these contracts is typically annual and non-cancellable for the term of the subscription and may contain provisions for minimum monthly payments.
|
•
|
Recurring variable revenue represents revenue from contracts that specify a fee for services, which is typically not fixed. The variable fee is usually 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. Recurring variable revenue was derived entirely from the Financial Services segment for all periods presented.
|
•
|
Non-recurring revenue represents consulting (e.g., research and analysis, modeling, and forecasting), services, single-document product sales, perpetual license sales and associated services, conferences and events, and advertising. Our non-recurring products and services are an important part of our business because they complement our recurring business in creating strong and comprehensive customer relationships.
|
•
|
EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA are used by many of our investors, research analysts, investment bankers, and lenders to assess our operating performance. For example, a measure similar to Adjusted EBITDA is required by the lenders under our revolving credit agreement. We define EBITDA as net income plus or minus net interest, plus provision for income taxes, depreciation, and amortization. Our definition of Adjusted EBITDA further excludes primarily non-cash items and other items that we do not consider to be useful in assessing our operating performance (e.g., stock-based compensation expense, restructuring charges, acquisition-related costs and performance compensation, exceptional litigation, net other gains and losses, pension
|
•
|
Free Cash Flow. We define free cash flow as net cash provided by operating activities less capital expenditures.
|
|
Change in Total Revenue
|
|||||||
|
Organic
|
|
Acquisitive
|
|
Foreign
Currency
|
|||
Third quarter 2019 vs. third quarter 2018
|
6
|
%
|
|
6
|
%
|
|
(1
|
)%
|
Year-to-date 2019 vs. year-to-date 2018
|
6
|
%
|
|
7
|
%
|
|
(1
|
)%
|
|
Three months ended August 31,
|
|
Percentage
Change
|
|
Nine months ended August 31,
|
|
Percentage
Change
|
||||||||||||||
(In millions, except percentages)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Resources
|
$
|
230.0
|
|
|
$
|
211.5
|
|
|
9
|
%
|
|
$
|
696.2
|
|
|
$
|
653.8
|
|
|
6
|
%
|
Transportation
|
314.9
|
|
|
297.0
|
|
|
6
|
%
|
|
921.6
|
|
|
862.9
|
|
|
7
|
%
|
||||
CMS
|
138.6
|
|
|
137.3
|
|
|
1
|
%
|
|
405.5
|
|
|
413.8
|
|
|
(2
|
)%
|
||||
Financial Services
|
428.8
|
|
|
355.2
|
|
|
21
|
%
|
|
1,270.9
|
|
|
1,010.9
|
|
|
26
|
%
|
||||
Total revenue
|
$
|
1,112.3
|
|
|
$
|
1,001.0
|
|
|
11
|
%
|
|
$
|
3,294.2
|
|
|
$
|
2,941.4
|
|
|
12
|
%
|
|
Increase in revenue
|
||||||||||||||||
|
Third quarter 2019 vs. third quarter 2018
|
|
Year-to-date 2019 vs. year-to-date 2018
|
||||||||||||||
|
Organic
|
|
Acquisitive
|
|
Foreign
Currency
|
|
Organic
|
|
Acquisitive
|
|
Foreign
Currency
|
||||||
Resources
|
6
|
%
|
|
3
|
%
|
|
—
|
%
|
|
6
|
%
|
|
1
|
%
|
|
(1
|
)%
|
Transportation
|
7
|
%
|
|
—
|
%
|
|
(1
|
)%
|
|
8
|
%
|
|
—
|
%
|
|
(1
|
)%
|
CMS
|
5
|
%
|
|
(4
|
)%
|
|
(1
|
)%
|
|
—
|
%
|
|
(1
|
)%
|
|
(1
|
)%
|
Financial Services
|
6
|
%
|
|
16
|
%
|
|
(1
|
)%
|
|
5
|
%
|
|
22
|
%
|
|
(1
|
)%
|
|
Three months ended August 31,
|
|
Percentage change
|
|
Nine months ended August 31,
|
|
Percentage change
|
||||||||||||||||||||
(in millions, except percentages)
|
2019
|
|
2018
|
|
Total
|
|
Organic
|
|
2019
|
|
2018
|
|
Total
|
|
Organic
|
||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Recurring fixed
|
$
|
799.9
|
|
|
$
|
717.7
|
|
|
11
|
%
|
|
7
|
%
|
|
$
|
2,352.3
|
|
|
$
|
2,099.1
|
|
|
12
|
%
|
|
6
|
%
|
Recurring variable
|
144.4
|
|
|
124.8
|
|
|
16
|
%
|
|
5
|
%
|
|
425.4
|
|
|
367.8
|
|
|
16
|
%
|
|
3
|
%
|
||||
Non-recurring
|
168.0
|
|
|
158.5
|
|
|
6
|
%
|
|
4
|
%
|
|
516.5
|
|
|
474.5
|
|
|
9
|
%
|
|
7
|
%
|
||||
Total revenue
|
$
|
1,112.3
|
|
|
$
|
1,001.0
|
|
|
11
|
%
|
|
6
|
%
|
|
$
|
3,294.2
|
|
|
$
|
2,941.4
|
|
|
12
|
%
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
As a percent of total revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Recurring fixed
|
72
|
%
|
|
72
|
%
|
|
|
|
|
|
71
|
%
|
|
71
|
%
|
|
|
|
|
||||||||
Recurring variable
|
13
|
%
|
|
12
|
%
|
|
|
|
|
|
13
|
%
|
|
13
|
%
|
|
|
|
|
||||||||
Non-recurring
|
15
|
%
|
|
16
|
%
|
|
|
|
|
|
16
|
%
|
|
16
|
%
|
|
|
|
|
|
Three months ended August 31,
|
|
Percentage
Change
|
|
Nine months ended August 31,
|
|
Percentage
Change
|
||||||||||||||
(In millions, except percentages)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of revenue
|
$
|
419.7
|
|
|
$
|
375.3
|
|
|
12
|
%
|
|
$
|
1,247.5
|
|
|
$
|
1,086.6
|
|
|
15
|
%
|
SG&A expense
|
295.4
|
|
|
287.7
|
|
|
3
|
%
|
|
889.0
|
|
|
877.2
|
|
|
1
|
%
|
||||
Total cost of revenue and SG&A expense
|
$
|
715.1
|
|
|
$
|
663.0
|
|
|
8
|
%
|
|
$
|
2,136.5
|
|
|
$
|
1,963.8
|
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization expense
|
$
|
144.7
|
|
|
$
|
134.1
|
|
|
8
|
%
|
|
$
|
431.0
|
|
|
$
|
395.7
|
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As a percent of revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total cost of revenue and SG&A expense
|
64
|
%
|
|
66
|
%
|
|
|
|
65
|
%
|
|
67
|
%
|
|
|
||||||
Depreciation and amortization expense
|
13
|
%
|
|
13
|
%
|
|
|
|
13
|
%
|
|
13
|
%
|
|
|
|
Three months ended August 31,
|
|
Percentage
Change |
|
Nine months ended August 31,
|
|
Percentage
Change |
||||||||||||||
(In millions, except percentages)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||||
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Resources
|
$
|
100.8
|
|
|
$
|
85.1
|
|
|
18
|
%
|
|
$
|
303.2
|
|
|
$
|
270.5
|
|
|
12
|
%
|
Transportation
|
134.2
|
|
|
128.1
|
|
|
5
|
%
|
|
385.1
|
|
|
362.5
|
|
|
6
|
%
|
||||
CMS
|
31.1
|
|
|
30.3
|
|
|
3
|
%
|
|
89.8
|
|
|
92.0
|
|
|
(2
|
)%
|
||||
Financial Services
|
199.1
|
|
|
156.3
|
|
|
27
|
%
|
|
587.9
|
|
|
457.5
|
|
|
29
|
%
|
||||
Shared services
|
(12.3
|
)
|
|
(9.3
|
)
|
|
|
|
(40.0
|
)
|
|
(34.6
|
)
|
|
|
||||||
Total Adjusted EBITDA
|
$
|
452.9
|
|
|
$
|
390.5
|
|
|
16
|
%
|
|
$
|
1,326.0
|
|
|
$
|
1,147.9
|
|
|
16
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As a percent of segment revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Resources
|
44
|
%
|
|
40
|
%
|
|
|
|
44
|
%
|
|
41
|
%
|
|
|
||||||
Transportation
|
43
|
%
|
|
43
|
%
|
|
|
|
42
|
%
|
|
42
|
%
|
|
|
||||||
CMS
|
22
|
%
|
|
22
|
%
|
|
|
|
22
|
%
|
|
22
|
%
|
|
|
||||||
Financial Services
|
46
|
%
|
|
44
|
%
|
|
|
|
46
|
%
|
|
45
|
%
|
|
|
|
Three months ended August 31,
|
|
Percentage
Change |
|
Nine months ended August 31,
|
|
Percentage
Change |
||||||||||||||
(In millions, except percentages)
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
||||||||||||
Net income attributable to IHS Markit Ltd.
|
$
|
40.1
|
|
|
$
|
104.5
|
|
|
(62
|
)%
|
|
$
|
299.6
|
|
|
$
|
460.5
|
|
|
(35
|
)%
|
Interest income
|
(0.6
|
)
|
|
(0.9
|
)
|
|
|
|
(1.6
|
)
|
|
(2.5
|
)
|
|
|
||||||
Interest expense
|
63.2
|
|
|
56.7
|
|
|
|
|
195.9
|
|
|
158.3
|
|
|
|
||||||
Provision (benefit) for income taxes
|
240.6
|
|
|
7.9
|
|
|
|
|
263.9
|
|
|
(126.7
|
)
|
|
|
||||||
Depreciation
|
51.5
|
|
|
45.0
|
|
|
|
|
147.5
|
|
|
129.0
|
|
|
|
||||||
Amortization
|
93.2
|
|
|
89.1
|
|
|
|
|
283.5
|
|
|
266.7
|
|
|
|
||||||
EBITDA
|
$
|
488.0
|
|
|
$
|
302.3
|
|
|
61
|
%
|
|
$
|
1,188.8
|
|
|
$
|
885.3
|
|
|
34
|
%
|
Stock-based compensation expense
|
54.0
|
|
|
52.5
|
|
|
|
|
167.3
|
|
|
172.1
|
|
|
|
||||||
Restructuring charges
|
1.1
|
|
|
0.4
|
|
|
|
|
11.0
|
|
|
0.4
|
|
|
|
||||||
Acquisition-related costs
|
8.1
|
|
|
30.2
|
|
|
|
|
21.6
|
|
|
57.4
|
|
|
|
||||||
Acquisition-related performance compensation
|
15.3
|
|
|
11.5
|
|
|
|
|
46.0
|
|
|
37.1
|
|
|
|
||||||
Loss on debt extinguishment
|
—
|
|
|
1.7
|
|
|
|
|
6.0
|
|
|
4.7
|
|
|
|
||||||
Gain on sale of assets
|
(113.0
|
)
|
|
—
|
|
|
|
|
(113.0
|
)
|
|
—
|
|
|
|
||||||
Pension mark-to-market and settlement (gain) expense
|
—
|
|
|
(7.3
|
)
|
|
|
|
—
|
|
|
(7.3
|
)
|
|
|
||||||
Share of joint venture results not attributable to Adjusted EBITDA
|
0.2
|
|
|
0.2
|
|
|
|
|
0.5
|
|
|
0.2
|
|
|
|
||||||
Adjusted EBITDA attributable to noncontrolling interest
|
(0.8
|
)
|
|
(1.0
|
)
|
|
|
|
(2.2
|
)
|
|
(2.0
|
)
|
|
|
||||||
Adjusted EBITDA
|
$
|
452.9
|
|
|
$
|
390.5
|
|
|
16
|
%
|
|
$
|
1,326.0
|
|
|
$
|
1,147.9
|
|
|
16
|
%
|
Adjusted EBITDA as a percentage of revenue
|
40.7
|
%
|
|
39.0
|
%
|
|
|
|
40.3
|
%
|
|
39.0
|
%
|
|
|
(In millions, except percentages)
|
As of August 31, 2019
|
|
As of November 30, 2018
|
|
Dollar change
|
|
Percentage change
|
|||||||
Accounts receivable, net
|
$
|
862.7
|
|
|
$
|
792.9
|
|
|
$
|
69.8
|
|
|
9
|
%
|
Accrued compensation
|
$
|
167.0
|
|
|
$
|
214.1
|
|
|
$
|
(47.1
|
)
|
|
(22
|
)%
|
Deferred revenue
|
$
|
896.5
|
|
|
$
|
886.8
|
|
|
$
|
9.7
|
|
|
1
|
%
|
|
Nine months ended August 31,
|
|
|
|
|
|||||||||
(In millions, except percentages)
|
2019
|
|
2018
|
|
Dollar change
|
|
Percentage change
|
|||||||
Net cash provided by operating activities
|
$
|
1,025.6
|
|
|
$
|
932.0
|
|
|
$
|
93.6
|
|
|
10
|
%
|
Net cash used in investing activities
|
$
|
(206.5
|
)
|
|
$
|
(2,064.2
|
)
|
|
$
|
1,857.7
|
|
|
(90
|
)%
|
Net cash (used in) provided by financing activities
|
$
|
(761.9
|
)
|
|
$
|
1,201.0
|
|
|
$
|
(1,962.9
|
)
|
|
(163
|
)%
|
|
Nine months ended August 31,
|
|
|
|
|
|||||||||
(In millions, except percentages)
|
2019
|
|
2018
|
|
Dollar change
|
|
Percentage change
|
|||||||
Net cash provided by operating activities
|
$
|
1,025.6
|
|
|
$
|
932.0
|
|
|
|
|
|
|||
Capital expenditures on property and equipment
|
(199.9
|
)
|
|
(168.5
|
)
|
|
|
|
|
|||||
Free cash flow
|
$
|
825.7
|
|
|
$
|
763.5
|
|
|
$
|
62.2
|
|
|
8
|
%
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
|
Total Number of Shares
Purchased
|
|
Average
Price Paid
per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in millions)
|
|||||
June 1 - June 30, 2019:
|
|
|
|
|
|
|
|
|||||
Employee transactions (2)
|
897
|
|
|
$
|
59.32
|
|
|
N/A
|
|
|
N/A
|
|
July 1 - July 31, 2019:
|
|
|
|
|
|
|
|
|||||
Employee transactions (2)
|
42,672
|
|
|
$
|
64.62
|
|
|
N/A
|
|
|
N/A
|
|
Accelerated share repurchase program (1)(3)
|
2,477,547
|
|
|
64.21
|
|
|
2,477,547
|
|
|
806.9
|
|
|
August 1 - August 31, 2019:
|
|
|
|
|
|
|
|
|||||
Employee transactions (2)
|
5,362
|
|
|
$
|
63.65
|
|
|
N/A
|
|
|
N/A
|
|
Accelerated share repurchase program (3)
|
637,208
|
|
|
$
|
64.21
|
|
|
637,208
|
|
|
806.9
|
|
Total share repurchases
|
3,163,686
|
|
|
$
|
64.21
|
|
|
3,114,755
|
|
|
|
Item 6.
|
Exhibits
|
(a)
|
Index of Exhibits
|
Exhibit
Number
|
|
Description
|
4.1
|
|
Base Indenture, dated as of July 23, 2018, between the Company and Wells Fargo Bank, National Association, as trustee (Incorporated by reference to Exhibit 4.1 of the IHS Markit Ltd. Current Report on Form 8-K (file no. 001-36495) filed on July 23, 2018)
|
4.2
|
|
Fourth Supplemental Indenture, dated as of April 8, 2019, between the Company and Wells Fargo Bank, National Association, as trustee (Incorporated by reference to Exhibit 4.4 of the IHS Markit Ltd. Current Report on Form 8-K (file no. 001-36495) filed on April 8, 2019)
|
4.3
|
|
Form of 4.250% Senior Note due 2029 (included in Exhibit 4.2)
|
10.1+*
|
|
|
10.2+*
|
|
|
10.3+*
|
|
|
10.4
|
|
Credit Agreement, dated as of September 13, 2019, by and among IHS Markit Ltd., as the Borrower, the lenders party thereto and PNC Bank, National Association, as Administrative Agent and certain lenders party thereto (Incorporated by reference to Exhibit 10.1 of the IHS Markit Ltd. Current Report on Form 8-K (file no. 001-36495) filed on September 19, 2019)
|
31.1*
|
|
|
31.2*
|
|
|
32*
|
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
104
|
|
The cover page from this Quarterly Report on Form 10-Q, formatted as Inline XBRL
|
IHS MARKIT LTD.
|
||||
|
|
|||
By:
|
|
/s/ Michael Easton
|
||
|
|
Name:
|
|
Michael Easton
|
|
|
Title:
|
|
Senior Vice President and Chief Accounting Officer
|
1 Year IHS Markit Ltd. Chart |
1 Month IHS Markit Ltd. Chart |
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