ADVFN Logo

We could not find any results for:
Make sure your spelling is correct or try broadening your search.

Trending Now

Toplists

It looks like you aren't logged in.
Click the button below to log in and view your recent history.

Hot Features

Registration Strip Icon for default Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.

EXPN Experian Plc

3,454.00
-18.00 (-0.52%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Experian Plc LSE:EXPN London Ordinary Share GB00B19NLV48 ORD USD0.10
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -18.00 -0.52% 3,454.00 3,462.00 3,464.00 3,484.00 3,427.00 3,470.00 1,867,323 16:35:28
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Business Services, Nec 6.62B 770M 0.7921 43.72 33.66B

Experian plc Experian Half-year Report (0385T)

12/11/2019 7:00am

UK Regulatory


Experian (LSE:EXPN)
Historical Stock Chart


From Mar 2019 to Mar 2024

Click Here for more Experian Charts.

TIDMEXPN

RNS Number : 0385T

Experian plc

12 November 2019

news release

Half-yearly financial report

7am, 12 November 2019 -- Experian plc, the global information services company, today issues its half-yearly financial report for the six months ended 30 September 2019.

Brian Cassin, Chief Executive Officer, commented:

"We have started the year well. First-half organic revenue growth was 7%, with acceleration in Q2. This reflects successful execution on big new addressable market opportunities, the global roll out of our innovative platforms and considerable momentum in Consumer Services as we invest in Experian Boost.

"We now expect full-year organic revenue growth in the 7-8% range, at the upper end of our previous guidance. We continue to expect EBIT growth at or above revenue growth and strong progress in Benchmark earnings per share, all at constant currency, and for the full year we expect operating cash conversion of around 90%."

 
                           Benchmark and Statutory financial highlights 
------------------------------------------------------------------------------------------------- 
                                   2019     2018(2)       Actual         Constant      Organic(3) 
                                   US$m       US$m      rates growth    rates growth     growth 
                                                             %               %              % 
                                ---------  ---------  --------------  --------------  ----------- 
 Benchmark(1) 
 Revenue - ongoing activities     2,495      2,361           6               8             7 
 Revenue                          2,495      2,364           6               8            n/a 
 Benchmark EBIT - ongoing 
  activities(4)                    670        647            4               6            n/a 
 Total Benchmark EBIT              670        649            3               5            n/a 
 Benchmark EPS                   USc 49.1   USc 48.7         1               3            n/a 
 Statutory 
 Revenue                          2,495      2,364           6               8            n/a 
 Operating profit                  556        580           (4)             n/a           n/a 
 Profit before tax                 480        470            2              n/a           n/a 
 Basic EPS                       USc 39.0   USc 35.3        10              n/a           n/a 
 Total dividend                  USc 14.5   USc 14.0         4              n/a           n/a 
                                ---------  ---------  --------------  --------------  ----------- 
 

1 See Appendix 1 (page 13) and note 6 to the financial statements (pages 25-26) for definitions of non-GAAP measures.

2 Benchmark measures are restated for exited business activities which comprise certain B2B businesses. 3 Organic revenue growth at constant exchange rates.

4 See page 13 for reconciliation of Benchmark EBIT from ongoing activities to Profit before tax.

   --      Strong first half performance. 

o Q2 organic revenue growth of 7% and H1 organic revenue growth of 7%.

o B2B organic revenue growth of 6%.

o Consumer Services organic revenue growth of 11% with rapidly growing new product portfolio.

o Benchmark EBIT (ongoing activities) growth at constant rates of 6%.

o Benchmark EBIT margin of 26.9%, down 50 basis points at both constant rates and actual rates, including one-off launch costs for Experian Boost.

o Benchmark EPS growth of 3% at constant rates.

   --      Operational highlights. 

o Strong momentum as we accelerate our global B2B innovation plays; Ascend, Experian One, open banking (Trusso and Verdus) and CrossCore all progressed strongly in the half, and considerable momentum in Experian Boost with quadrupling of revenues in CreditMatch.

o Good momentum in North America, as B2B innovations take-hold and with double-digit Consumer Services growth.

o Double-digit organic revenue growth in Latin America; preparing for positive data.

o Generating audiences at scale as global free consumer memberships reach 70m across our three major markets, up from c. 45m last year.

o Significant progress in Experian Boost, unique account connections of 2m US consumers.

o Further strategic progress with US$437m investments in acquisitions, including Compuscan, and additional acquisitions and minority investments.

   --      Continuing commitment to shareholder returns and disciplined capital allocation. 

o First interim dividend up 4% to 14.5 US cents per ordinary share.

o Completed US$181m of the share repurchase programme to 8 November 2019, of which US$137m was in the first half.

Contacts

Experian

Nadia Ridout-Jamieson Investor queries +44 (0)20 3042 4215

   Gerry Tschopp                            Media queries 

Finsbury

Rollo Head +44 (0)20 7251 3801

Jenny Davey

There will be a presentation today at 9.30am (UK time) to analysts and investors at the Bank of America Merrill Lynch Financial Centre, 2 King Edward Street, London, EC1A 1HQ. The presentation can be viewed live via the link from the Experian website at www.experianplc.com and can also be accessed live via a telephone dial-in facility: 0800 783 0906 (UK primary) or 01296 480 100 (UK direct) or +44 1296 480 100 (International direct), using access code 559 971 33. The supporting slides and an indexed replay will be available on the website later in the day.

Experian will update on third quarter trading for FY20 on 17 January 2020.

Roundings

Certain financial data has been rounded within this announcement. As a result of this rounding, the totals of data presented may vary slightly from the actual arithmetic totals of such data.

Definitions

B2B - Business-to-Business.

B2B2C - business-to-business-to-consumer.

Forward looking statements

Certain statements made in this announcement are forward looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from any expected future events or results referred to in these forward-looking statements. See page 12 for further information on risks and uncertainties facing Experian.

Company website

Neither the content of the Company's website, nor the content of any website accessible from hyperlinks on the Company's website (or any other website), is incorporated into, or forms part of, this announcement.

About Experian

Experian is the world's leading global information services company. During life's big moments - from buying a home or a car, to sending a child to college, to growing a business by connecting with new customers - we empower consumers and our clients to manage their data with confidence. We help individuals to take financial control and access financial services, businesses to make smarter decisions and thrive, lenders to lend more responsibly, and organisations to prevent identity fraud and crime.

We have 17,200 people operating across 44 countries and every day we're investing in new technologies, talented people and innovation to help all our clients maximise every opportunity. We are listed on the London Stock Exchange (EXPN) and are a constituent of the FTSE 100 Index.

Learn more at www.experianplc.com or visit our global content hub at our global news blog for the latest news and insights from the Group.

Chief Executive Officer's review

This was another half of good progress with strong momentum in North America, Latin America back to strong levels of growth, and pleasing progress in Consumer Services. All of which has its roots in our technology investments, new product innovation, new data sets and strong sales execution. We are experiencing expansion on many fronts as we address new opportunities to grow with existing clients and as we win new customers all around the world. We are also engaging with consumers in new ways and now reach tens of millions of people across our three major markets through our free offers. This gives us great confidence as we look out to H2 and beyond and we have therefore raised our full year organic revenue guidance to 7-8 %, the top half of our previous guidance range.

Financial highlights:

-- Total revenue growth of 8% at constant currency and organic revenue growth of 7%. At actual exchange rates total revenue growth was 6%. Organic revenue growth was 6% in Q1 accelerating to 7% in Q2.

-- Double-digit organic revenue growth in North America and Latin America, while UK and Ireland was flat and EMEA/Asia Pacific saw modest decline.

-- Continued momentum in B2B, with organic revenue growth of 6% at constant exchange rates with good demand for new sources of data and as we scale our global platforms.

-- Strong growth in Consumer Services, with organic revenue up 11% at constant exchange rates as we empower consumers to take control of their data and as we build relationships with millions of consumers.

   --      Growth in Benchmark EBIT of 6% at constant exchange rates, 4% at actual exchange rates. 

-- Benchmark EBIT margin at constant currency and actual rates was 26.9%, down 50 basis points, as we invested behind the launch of Experian Boost (80 basis points one-off launch costs) and saw higher depreciation on technology investments.

-- Growth in Benchmark earnings per share of 3% at constant exchange rates and 1% at actual exchange rates.

-- Conversion of Benchmark EBIT into Benchmark operating cash flow was 51%, in the seasonally weaker half of the year for cash flow.

We delivered further progress in B2B:

-- Our Data segment delivered organic revenue growth of 8% at constant exchange rates, with all regions contributing positively. This reflects investment in a wide range of unique sources of data, strength in consumer information across all territories, strong recovery in Brazil and a growing contribution from our bureaux in EMEA/Asia Pacific.

-- The total contract value for Ascend has now reached US$270m, as we secure new engagements for existing modules and introduce new modules to the platform. Ascend is currently live in the USA, UK, Brazil, and Italy and we expect to launch in more countries during this financial year.

-- While Decisioning revenue was flat in the half against strong prior-year comparables, pipelines are growing. We secured new contracts for PowerCurve; we have made excellent progress in fraud and identity, including with CrossCore; and Experian One, our new cloud-based decisioning platform, secured new wins during the half.

-- Experian Health delivered further good progress as we expand our position with healthcare providers and successfully extend our suite of services.

We made significant progress in Consumer Services as we:

-- Secured direct relationships with 70m consumers for free Experian offers (up from over 45m in FY19). We now have 24m free members in the USA, 39m in Brazil and 6.6m the UK.

-- Delivered strong growth in credit marketplace (lead generation) revenues in both the US and the UK and our consumer activities in Brazil have made significant progress towards meaningful revenue-generation.

-- Expanded our Experian Boost membership, with unique account connections of 2m US consumers since launch.

With regards to capital allocation and uses of cash:

-- We have made further strategic progress having completed the acquisition of Compuscan in the half plus other smaller investments, such as MyHealthDirect. We also purchased the remaining 45% of our subsidiary Experian MicroAnalytics and, after the end of the half-year took a controlling interest in RAMCI, a credit bureau in Malaysia, and we acquired Auto I.D., Inc., a leading provider of automotive solutions and services in the USA.

-- We made equity investments in Grab and CompareAsiaGroup. We also agreed new commercial agreements to help power their consumer financial marketplaces.

-- We are announcing a first interim dividend of 14.5 US cents per share, up 4% year-on-year. This will be paid on 31 January 2020 to shareholders on the register at the close of business on 3 January 2020.

-- We completed US$137m in net share repurchases in the first half, as part of our US$400m share repurchase programme this year, and as at 8 November 2019 that has increased to US$181m.

-- Net debt at the end of the first half was US$4,060m, which places us at 2.4 times Benchmark EBITDA, within our target leverage range of 2.0 to 2.5 times net debt to Benchmark EBITDA.

Regional highlights

We delivered strong organic revenue growth in North America and Latin America, whilst UK and Ireland was flat and EMEA/Asia Pacific was slightly lower.

 
           Year-on-year % change in organic revenue (1)               EBIT 
                                                                      margin 
                   Data   Decisioning   B2B(2)   Consumer    Total    Total 
                                                  Services 
                  -----  ------------  -------  ----------  ------  -------- 
 North America      9          6          8         13        10      34.6% 
                  -----  ------------  -------  ----------  ------  -------- 
 Latin America      10         7          10        n/a       10      27.6% 
                  -----  ------------  -------  ----------  ------  -------- 
 UK and Ireland     4         (8)        (1)         3         -      20.2% 
                  -----  ------------  -------  ----------  ------  -------- 
 EMEA/Asia 
  Pacific           7        (12)        (3)        n/a       (3)    (2.5)% 
                  -----  ------------  -------  ----------  ------  -------- 
 Total Global       8          -          6         11         7      26.9% 
                  -----  ------------  -------  ----------  ------  -------- 
 

1 Ongoing activities only, at constant exchange rates.

2 B2B = Business-to-Business segment consists of Data and Decisioning business sub-divisions.

See note 6 to the financial statements on pages 25-26 for definition of organic revenue growth.

North America

Revenue in North America was US$1,573m, with total and organic revenue growth of 10%.

North America B2B delivered organic revenue growth of 8% at constant exchange rates. Data saw strength in core profiles, as well as in mortgage, and a very strong contribution from Clarity Services. We are excited about our prospects as we launch new suites of credit score products which combine traditional credit, alternative credit and trended data assets covering a wider proportion of the US population and helping more people gain access to fair and affordable credit. Revenues for Ascend have also grown significantly as we secure new customers for existing modules and introduce new versions. In total five modules of Ascend have been successfully launched in the USA with further modules pending. Automotive also performed well in the half, reflecting good demand for our superior data assets, integrated cross-Experian propositions and new client wins for the automotive version of the Ascend sandbox.

Decisioning performed well, revenue was up 6% at constant exchange rates, as we delivered on significant new client engagements for fraud and identity management services. We have also secured a healthy pipeline for software including for Experian One, our cloud-based decisioning platform. Experian health performed well as we extend our position with healthcare providers. Our clients want to deliver better engagement with their patients and to provide greater transparency on payments. This is driving demand across our product suite, including for patient engagement, coverage discovery and identity management offers. The acquisition of MyHealthDirect further strengthens our proposition as it will help to simplify and automate the appointment, scheduling and payment processes for both healthcare providers and for patients.

In Consumer Services, we have had a tremendous response to the introduction of Experian Boost, the new unique service we introduced in March 2019. Experian Boost gives consumers the ability to make positive choices about using their data to build out their credit files using non-traditional sources like utility or mobile phone bills. In the USA 2m unique consumers have now connected their accounts, and "Experian Boost" is now one of the top 10 most searched keyword terms in the credit monitoring category. In total we have now signed 24m consumers to free membership offers, up from 16m at H1 FY19 and we stepped up marketing investment in the half to promote the service and drive traffic to our sites and mobile application.

Revenue performance in Consumer Services was strong, up 13% at constant exchange rates. This was in part driven by a quadrupling in lead generation revenue in the half through CreditMatch as consumers engage with Experian and are matched to suitable credit offers. Growth also reflected ongoing strength in identity management offers and a considerably-reduced drag in paid-for credit monitoring services. Partner Solutions also performed well, to some extent benefitting from a one-off data breach resolution contract win. During the second half, we expect the Consumer Services business to continue to grow well, with growth rates reflecting the material breach contract recorded in the second half of the previous year.

We have recently completed the acquisition of Auto I.D., Inc. a leading provider of solutions and services to automotive lenders in the US. We already have a successful, fast-growing automotive business in North America and adding Auto I.D.'s capabilities in recovering loss, mitigating risk, improving compliance and identifying fraud will allow us to offer an even more extensive range of products to our automotive clients.

North America Benchmark EBIT increased by 11% to US$544m. The Benchmark EBIT margin increased by 20 basis points year-on-year to 34.6%. This reflected strong operating leverage in B2B, offset by investments in customer acquisition to support the roll out of Experian Boost.

Latin America

Revenue in Latin America was US$352m, with total and organic revenue growth of 10% at constant exchange rates.

In Brazil, we have seen further improvements to economic and business confidence. Our business grew double-digit in H1 as this greater confidence combined with our innovation-led strategy which helped drive strong revenue performance. We have seen good growth across both consumer and business information, as well as a growing revenue contribution from our consumer-activities as we engage with millions of consumer members. Our base continues to grow quickly, and we now have 39m free members or over 18% of the population, giving us material scale.

In October, we received formal accreditation from the Central Bank in Brazil to incorporate positive credit payment data as part of our operations. This is a big and welcome change which will mean consumers and companies in Brazil will be automatically included in a positive credit registry. We believe it will help drive greater access to credit in Brazil at more affordable rates, reduce levels of credit distress and, in time, create the conditions for more customised credit offers. We estimate that over 150m people will be included in the positive data bureau with the advent of positive data.

We have now started to receive the positive data and expect to launch new products during FY20 and FY21. We believe we will have new opportunities to develop better scores, to increase adoption of advanced analytical and cloud-based decisioning tools, and that positive data will give rise to enhanced services for consumers. Our plans are well advanced as we have pre-invested in our technology platform and have a detailed roadmap for the roll out of positive data propositions.

Growth in Spanish Latin America was driven by a strong performance in Colombia, as we extend the range of services we offer to our B2B clients and we signed a number of significant new contracts. We see good prospects as we introduce more of our global Experian platforms into the region, including Ascend, CrossCore and Experian One and direct-to-consumer.

Benchmark EBIT in Latin America was US$97m, up 6% at constant exchange rates. Benchmark EBIT margin was 27.6% (2018: 28.9%) reflecting revenue mix effects and investments in consumer, positive data preparation and our technology platforms.

UK and Ireland

Revenue in the UK and Ireland was US$371m. Total and organic revenue growth was flat at constant exchange rates. B2B declined (1)% while Consumer Services delivered organic revenue growth of 3%.

Within B2B, Data delivered revenue growth of 4% at constant exchange rates, with a strong performance across the consumer credit bureau operations. This reflects the investments we have made in unique propositions, such as trended data and open banking (Trusso and Verdus), and in our B2B platform strategy. We are delivering services to digitise the process of applying for a mortgage, with several new client engagements, take-up rates for our open-data aggregation platform have been strong and we have established significant scale in personalised eligibility services for B2B marketplaces. Other parts of our Data operations were somewhat weaker however, particularly on the more cyclical marketing side of our business. Decisioning also experienced weakness, with organic revenue down (8%). This was as we lapped strong prior-year comparables and saw a subdued macroeconomic backdrop impact the pace of client investments in new software installations. We expect this to continue to be a headwind in the near-term given ongoing political and economic uncertainty in the UK.

In Consumer Services, we have made steady progress with the business back to growth in H1, driven by significant expansion of our CreditMatcher comparison service. This more than offset modest declines in paid memberships. Our free membership base has reached 6.6m consumers and we will continue to add exciting new features to help consumers better manage their money.

Benchmark EBIT was US$75m, down (20)% at constant exchange rates. This reflected the reduction in Decisioning revenue, as well as increased depreciation and further investment related to technology infrastructure to support the roll out of our global platforms. The Benchmark EBIT margin was 20.2% (2018: 25.7%).

EMEA/Asia Pacific

In EMEA/Asia Pacific, revenue was US$199m, with total revenue growth of 5% and organic growth of (3)% at constant rates. The difference relates to the contribution from the Compuscan acquisition.

We delivered good growth in Data, where organic revenue was up 7% at constant exchange rates. This reflected good progress in our bureaux in EMEA and significant growth across our consumer credit bureaux in India and Australia. We also benefitted from first time revenue contributions for Ascend, as we secure new client engagements, and for affordability solutions, for example through Trusso, our open data platform. In its first few months under Experian ownership Compuscan, our new credit bureau in South Africa performed well and we are excited about the opportunities for the combined business.

Decisioning revenue declined by (12%) at constant exchange rates, reflecting solid progress in EMEA offset by weakness in Asia Pacific as we lapped a small number of large decisioning contracts in the prior year. Notwithstanding this, pipelines are very strong, and we have secured several contracts across our PowerCurve suite. We therefore have good line of sight to improving revenue growth momentum as we exit this financial year.

We made several strategic investments in both EMEA and Asia Pacific during the half. We are delighted to welcome RAMCI to Experian. RAMCI is a credit bureau in Malaysia in which we previously held a minority stake and which now moves to control. We have also taken minority equity stakes in Grab and CompareAsiaGroup. We also agreed commercial agreements to supply scores and decisioning software to power their consumer credit portals.

Benchmark EBIT was US$(5)m (2018: US$(9)m). At actual exchange rates Benchmark EBIT growth was 36% and at constant exchange rates it was 46%. Benchmark EBIT margin from ongoing activities at actual rates increased 200 basis points to (2.5)% as our operations grow in scale.

Other financial developments

Our Benchmark PBT was US$604m, up 4% at constant currency and 2% at actual rates, after higher Benchmark net interest expense of US$66m (2018: US$56m), reflecting higher Net debt largely due to the acquisitions made in the half and a US$5m IFRS16 related interest charge (see note 3 to the financial statements for further information). We now expect net interest of c.US$130m for the full year including the effects of IFRS16. While IFRS16 will have no material impact on our overall financial results, it will reduce total operating expense by around $10m and increase interest expense by a similar amount in FY20.

The Benchmark tax rate was 26.2% (2018: 25.3%). The increase reflected the mix of profit in the half. We expect the Benchmark tax rate to be c. 26% in FY20 reflecting the mix of profits and prevailing tax rates by territory.

Our Benchmark EPS was 49.1 US cents, an increase of 3% at constant currency and 1% at actual rates, as the weighted average number of ordinary shares (WANOS) reduced to 903m (2018: 907m) as a result of our share repurchase programme.

Benchmark operating cash flow declined 29% at actual rates and our Benchmark operating cash flow conversion was 51% (2018: 74%), as we saw our investment programme phased more to the first half of the year which is also our traditionally weaker half of the year for cash generation. We continue to expect a conversion of Benchmark EBIT to operating cash flow of around 90% for the year ending 31 March 2020.

Consistent with our capital allocation framework, uses of cash were balanced between growth investment and returns to shareholders. Net capital expenditure was US$223m, which represented 9% of total revenue in the half. We continue to expect net capital expenditure to be in the range of 9-10% of revenue in FY20 as we invest in new products and innovation. After acquisition and investment expenditure of US$499m, ordinary dividends paid of US$294m, and net share purchases of US$137m, we ended the half year with Net debt of US$4,060m, placing us at 2.4 times EBITDA, within our target range of 2.0 to 2.5 times net debt to EBITDA.

Foreign exchange translation was a 2% headwind to EPS in the half year. This was predominantly due to the Brazilian real, which weakened by 4% relative to the US dollar versus the prior year, and weakness in GBP sterling. Assuming recent rates stay the same for the rest of the year, we now expect a full-year EBIT headwind of c.1-2%.

Group financial results

Revenue by region

 
 Six months ended 30 September                                    Growth % 
                                 ------ 
                                                         Total    Total at        Organic 
                                   2019   2018(1)    at actual    constant    at constant 
                                   US$m      US$m        rates       rates          rates 
                                 ------            -----------  ----------  ------------- 
 North America 
 Data                               791       726                        9              9 
 Decisioning                        322       301                        7              6 
                                 ------  --------  -----------  ----------  ------------- 
 B2B                              1,113     1,027                        8              8 
 Consumer Services                  460       403                       14             13 
                                 ------  --------  -----------  ----------  ------------- 
 Total ongoing activities         1,573     1,430           10          10             10 
 Exited business activities(1)        -         - 
                                 ------  --------  -----------  ----------  ------------- 
 Total North America              1,573     1,430 
                                 ------  --------  -----------  ----------  ------------- 
 Latin America 
 Data                               300       287                       10             10 
 Decisioning                         52        52                        7              7 
 Total ongoing activities           352       339            4          10             10 
 Exited business activities           -         - 
                                 ------  --------  -----------  ----------  ------------- 
 Total Latin America                352       339 
                                 ------  --------  -----------  ----------  ------------- 
 UK and Ireland 
 Data                               182       184                        4              4 
 Decisioning                        109       126                      (8)            (8) 
                                 ------  --------  -----------  ----------  ------------- 
 B2B                                291       310                      (1)            (1) 
 Consumer Services                   80        83                        3              3 
                                 ------  --------  -----------  ----------  ------------- 
 Total ongoing activities           371       393          (6)           -              - 
 Exited business activities           -         3 
                                 ------  --------  -----------  ----------  ------------- 
 Total UK and Ireland               371       396 
                                 ------  --------  -----------  ----------  ------------- 
 EMEA/Asia Pacific 
 Data                               104        86                       26              7 
 Decisioning                         95       113                     (11)           (12) 
 Total ongoing activities           199       199            -           5            (3) 
 Exited business activities           -         - 
                                 ------  --------  -----------  ----------  ------------- 
 Total EMEA/Asia Pacific            199       199 
                                 ------  --------  -----------  ----------  ------------- 
 Total revenue - ongoing 
  activities                      2,495     2,361            6           8              7 
 Total revenue - exited 
  business activities                 -         3 
                                 ------  --------  -----------  ----------  ------------- 
 Revenue                          2,495     2,364            6           8 
                                 ------  --------  -----------  ----------  ------------- 
 

1 Results for 2018 are restated for the reclassification to exited business activities of certain B2B businesses.

See Appendix 1 (page 13) and note 6 to the financial statements (pages 25-26) for definitions of non-GAAP measures.

See Appendix 2 (page 13) for analyses of revenue, Benchmark EBIT and Benchmark EBIT margin from ongoing activities by business segment.

Income statement, earnings and Benchmark EBIT margin analysis

 
 Six months ended 30 September                                         Growth % 
                                            -------- 
                                                                 Total at    Total at 
                                                2019   2018(1)     actual    constant 
                                                US$m      US$m      rates       rates 
                                            --------            ---------  ---------- 
 Benchmark EBIT by geography 
 North America                                   544       492                     11 
 Latin America                                    97        98                      6 
 UK and Ireland                                   75       101                   (20) 
 EMEA/Asia Pacific                               (5)       (9)                     46 
                                            --------  --------  ---------  ---------- 
 Benchmark EBIT before Central Activities        711       682                      5 
 Central Activities - central corporate 
  costs                                         (41)      (35) 
                                            --------  --------  ---------  ---------- 
 Benchmark EBIT from ongoing activities          670       647          4           6 
 Exited business activities(1)                     -         2 
                                            --------  --------  ---------  ---------- 
 Benchmark EBIT                                  670       649          3           5 
 Net interest                                   (66)      (56) 
                                            --------  --------  ---------  ---------- 
 Benchmark PBT                                   604       593          2           4 
 Exceptional items                              (35)         - 
 Amortisation of acquisition intangibles        (59)      (56) 
 Acquisition expenses                           (16)       (6) 
 Adjustment to the fair value of 
  contingent consideration                         1       (3) 
 Non-benchmark share of post-tax                  36         - 
  profit of associates 
 Interest on uncertain tax provisions            (7)       (7) 
 Financing fair value remeasurements            (44)      (51) 
 Profit before tax                               480       470 
 Group tax charge                              (125)     (149) 
 Profit after tax                                355       321 
                                            --------  --------  --------- 
 
 Benchmark earnings 
 Benchmark PBT                                   604       593          2           4 
 Benchmark tax charge                          (158)     (150) 
                                            --------  --------  ---------  ---------- 
 Total Benchmark earnings                        446       443 
                                            --------  --------  ---------  ---------- 
 Owners of Experian plc                          443       442          -           2 
 Non-controlling interests                         3         1 
                                            --------  --------  ---------  ---------- 
 
 Benchmark EPS                               US49.1c   US48.7c          1           3 
 Basic EPS                                   US39.0c   US35.3c 
 Weighted average number of ordinary 
  shares                                        903m      907m 
                                            --------  --------  ---------  ---------- 
 
 Benchmark EBIT margin - ongoing 
  activities 
 North America                                 34.6%     34.4% 
 Latin America                                 27.6%     28.9% 
 UK and Ireland                                20.2%     25.7% 
 EMEA/Asia Pacific                            (2.5)%    (4.5)% 
                                            --------  --------  ---------  ---------- 
 Benchmark EBIT margin                         26.9%     27.4% 
                                            --------  --------  ---------  ---------- 
 
 

1 Results for 2018 are restated for the reclassification to exited business activities of certain B2B businesses.

See Appendix 1 (page 13) and note 6 to the financial statements (pages 25-26) for definitions of non-GAAP measures.

See Appendix 2 (page 13) for analyses of revenue, Benchmark EBIT and Benchmark EBIT margin from ongoing activities by business segment.

Group financial review

Key statutory measures

Statutory revenue

We continued to make good progress during the period, revenue increased by 6% to US$2,495m (2018: US$2,364m), reflecting an improved underlying performance by both business segments.

Statutory operating profit and profit before tax

Operating profit for the six months ended 30 September 2019 decreased to US$556m from US$580m in the prior period, largely due to the charge for Exceptional items. Profit before tax increased to US$480m (2018: US$470m). We benefitted from a gain on an associate's business disposal which increased our share of the post-tax profit of associates by US$37m in the period.

Statutory Basic EPS

Basic EPS was up 10% to 39.0 US cents (2018: 35.3 US cents). The increase reflects a mix of factors including a higher profit before tax, a lower tax charge and a lower number of shares in issue as a consequence of our continuing share repurchase programme.

Statutory cash flow

Cash generated from operations was US$552m (2018: US$638m) reflecting movements in working capital. New borrowings totalled US$839m, reflecting the funding required for the increased acquisition activity (US$353m), cash outflows in respect of net share purchases (US$137m) and payment of the second interim dividend (US$295m) during the half year. Undrawn committed borrowing facilities were US$2,175m at 30 September 2019, a reduction of US$450m from 31 March 2019, as committed facilities were drawn down.

Tax

The effective rate of tax based on profit before tax is 26.0%, a reduction from the comparative period which was 31.7%, and unusually high as a result of a non-recurring tax charge in North America.

Balance sheet commentary

Net assets

At 30 September 2019, net assets amounted to US$2,317m (2018: US$2,282m). Capital employed, as defined in note 6(q) to the condensed half-yearly financial statements, was US$6,657m (2018: US$6,092m). Following the implementation of IFRS 16, right-of-use assets and lease liabilities have been recognised on the Group balance sheet. Further detail on the transition to IFRS 16 is included in note 3.

Equity

There was a decrease in equity of US$177m from US$2,494m at 31 March 2019 with movements detailed in the Group statement of changes in total equity on page 18.

Key movements in equity during the half include:

   --      Profit for the period of US$355m. 
   --      Currency translation losses of US$112m. 
   --      Remeasurement gains of US$44m in respect of defined benefit pension plans. 
   --      Dividends of US$295m and a movement of US$137m in connection with net share purchases. 

Seasonality

In recent years, our Benchmark EBIT performance has tended to be weighted towards the second half of the year reflecting revenue seasonality. This pattern is expected to continue during the year ending 31 March 2020.

Foreign currency

Foreign exchange - average rates

The principal exchange rates used to translate revenue and Benchmark EBIT into the US dollar are shown in the table below.

 
                                Period ended    Period ended       Year ended 
                                30 September    30 September    31 March 2019 
                                        2019            2018 
 US dollar : Brazilian 
  real                                  3.95            3.78             3.79 
 Pound sterling : US dollar             1.26            1.33             1.31 
 Euro : US dollar                       1.12            1.18             1.16 
 US dollar : Colombian 
  peso                                 3,292           2,902            3,025 
 US dollar : South African 
  rand                                 14.54           13.38            13.76 
                              --------------  --------------  --------------- 
 

The impact of currency movements on revenue from ongoing activities is set out in note 7(c).

Foreign exchange - closing rates

The principal exchange rates used to translate assets and liabilities into the US dollar at the period end dates are shown in the table below.

 
                               30 September   30 September   31 March 2019 
                                       2019           2018 
 US dollar : Brazilian 
  real                                 4.16           4.01            3.89 
 Pound sterling : US dollar            1.23           1.30            1.31 
 Euro : US dollar                      1.09           1.16            1.12 
 US dollar : Colombian 
  peso                                3,464          2,981           3,163 
 US dollar : South African 
  rand                                15.17          14.16           14.47 
                              -------------  -------------  -------------- 
 

Risks

We continue to see heightened legislative and regulatory activity, particularly as it relates to privacy and information security matters. Except for these matters, the principal risks and uncertainties we face in the remaining six months of the year remain largely unchanged from those explained in detail on pages 52 to 59 of our Annual Report for the year ended 31 March 2019:

   --     Loss or inappropriate use of data and systems; 
   --     Failure to comply with laws and regulations; 
   --     Non-resilient IT/business environment; 
   --     Business conduct risk; 
   --     Dependence on highly skilled personnel; 
   --     Adverse and unpredictable financial markets or fiscal developments; 
   --     New legislation or changes in regulatory enforcement; 
   --     Increasing competition; and 
   --     Undesirable investment outcomes. 

'Data ownership, access and integrity' reported as a principal risk in our Annual Report for the year ended 31 March 2019 overlaps with other risks such as legislative, regulatory and compliance. Consequently, we no longer identify 'data ownership, access and integrity' as a standalone principal risk. None of the risk information in this category has been eliminated but is covered within the other principal risks noted above.

In the first half of the financial year, we note that new laws, new interpretations of existing laws, changes to existing regulations and regulatory scrutiny continue to increase. Recent examples include the California Consumer Privacy Act and the Brazilian General Data Protection Law.

We continue to experience an increasing number of consumer and class actions in the USA.

We note continued uncertainty in the development of tax legislation in our key regions.

We are also still closely monitoring trends in geopolitical risks given the uncertainty related to Brexit and populist agendas across a number of regions.

Further information on financial risk management is given in note 24 to the condensed half-yearly financial statements.

The Chief Executive Officer's, Business and Group financial reviews on pages 3 to 11 include consideration of key uncertainties affecting us for the remainder of the current financial year. There may however be additional risks unknown to us and other risks, currently believed to be immaterial, which could turn out to be material. These risks, whether they materialise individually or simultaneously, could significantly affect our business and financial results.

Going concern

Having reassessed the principal risks at the time of approving these condensed half-yearly financial statements, the directors considered it appropriate to adopt the going concern basis of accounting.

Appendices

1. Non-GAAP financial information

We have identified and defined certain measures that we believe assist understanding of our performance. These measures are not defined under IFRS and they may not be directly comparable with other companies' adjusted measures. These non-GAAP measures are not intended to be a substitute for any IFRS measures of performance but we have included them as these are considered to be key measures used within the business for assessing the underlying performance of our ongoing businesses. Information on certain of our non-GAAP measures is set out below in the further appendices. Definitions of all our non-GAAP measures are given in note 6 to the condensed half-yearly financial statements.

The reconciliation of revenue from ongoing activities is set out in note 7(c) on page 28, Benchmark EBIT and Benchmark PBT in Appendix 3 below and Benchmark EPS in note 13 on page 32.

2. Revenue, Benchmark EBIT and Benchmark EBIT margin by business segment

 
 Six months ended 30 September                                      Growth 
                                                                Total        Organic 
                                                          at constant    at constant 
                                      2019     2018(1)          rates          rates 
                                      US$m        US$m              %              % 
                                   -------  ----------  -------------  ------------- 
 Revenue 
 Data                                1,377       1,283             10              8 
 Decisioning                           578         592              -              - 
                                   -------  ----------  -------------  ------------- 
 B2B                                 1,955       1,875              7              6 
 Consumer Services                     540         486             12             11 
                                   -------  ----------  -------------  ------------- 
 Total - ongoing activities          2,495       2,361              8              7 
 Exited business activities(1)           -           3            n/a 
                                   -------  ----------  -------------  ------------- 
 Total revenue                       2,495       2,364              8 
                                   -------  ----------  -------------  ------------- 
 Benchmark EBIT 
 B2B                                   586         561              7 
 Consumer Services                     125         121              4 
                                   -------  ----------  -------------  ------------- 
 Total business segments               711         682              6 
 Central Activities - central 
  corporate costs                     (41)        (35)            n/a 
                                   -------  ----------  -------------  ------------- 
 Total - ongoing activities            670         647              6 
 Exited business activities(1)           -           2            n/a 
                                   -------  ----------  -------------  ------------- 
 Total Benchmark EBIT                  670         649              5 
                                   -------  ----------  -------------  ------------- 
 Benchmark EBIT margin - ongoing 
  activities 
 B2B(1)                              30.0%       29.9% 
 Consumer Services                   23.1%       24.9% 
                                   -------  ----------  -------------  ------------- 
 Total Benchmark EBIT margin         26.9%       27.4% 
                                   -------  ----------  -------------  ------------- 
 

1. Comparative information is restated following the reclassification to exited business activities of certain B2B businesses.

3. Summary reconciliation of Benchmark EBIT to statutory profit before tax

 
 Six months ended 30 September                    2019    2018 
                                                  US$m    US$m 
                                                ------  ------ 
 Benchmark EBIT                                    670     649 
 Net interest expense                             (66)    (56) 
----------------------------------------------  ------  ------ 
 Benchmark PBT                                     604     593 
 Exceptional items and other adjustments made 
  to derive Benchmark PBT(2)                     (124)   (123) 
----------------------------------------------  ------ 
 Profit before tax                                 480     470 
----------------------------------------------  ------  ------ 
 
   2.       See note 9. 

Appendices (continued)

4. Cash flow and Net debt summary

 
 Six months ended 30 September                            2019      2018 
                                                          US$m      US$m 
                                                      --------  -------- 
 Benchmark EBIT                                            670       649 
 Amortisation and depreciation charged to Benchmark 
  EBIT                                                     204       159 
----------------------------------------------------  --------  -------- 
 Benchmark EBITDA                                          874       808 
 Net capital expenditure                                 (223)     (181) 
 Increase in working capital                             (317)     (188) 
 Principal lease payments                                 (26)         - 
 Profit retained in associates                             (1)       (2) 
 Charge for share incentive plans                           33        41 
----------------------------------------------------  --------  -------- 
 Benchmark operating cash flow                             340       478 
 Net interest paid                                        (69)      (55) 
 Tax paid                                                (146)      (84) 
 Dividends paid to non-controlling interests               (1)         - 
----------------------------------------------------  --------  -------- 
 Benchmark free cash flow                                  124       339 
 Acquisitions                                            (437)      (13) 
 Purchase of investments                                  (62)      (17) 
 Movement in Exceptional and other non-benchmark 
  items                                                   (17)       (8) 
 Ordinary dividends paid                                 (294)     (284) 
----------------------------------------------------  --------  -------- 
 Net cash (outflow)/inflow - continuing operations       (686)        17 
 Net cash outflow - discontinued operations                (7)      (32) 
 Net debt at 1 April                                   (3,262)   (3,408) 
 Net share purchases                                     (137)     (107) 
 Foreign exchange and other movements                       32        27 
----------------------------------------------------  --------  -------- 
 Net debt at 30 September                              (4,060)   (3,503) 
----------------------------------------------------  --------  -------- 
 

5. Total investment

 
 Six months ended 30 September                2019   2018 
                                              US$m   US$m 
                                             -----  ----- 
 Capital expenditure                           226    183 
 Disposal of property, plant and equipment     (3)    (2) 
-------------------------------------------  -----  ----- 
 Net capital expenditure                       223    181 
 Acquisitions                                  437     13 
 Purchase of investments                        62     17 
-------------------------------------------  -----  ----- 
 Total investment                              722    211 
-------------------------------------------  -----  ----- 
 

Condensed half-yearly financial statements

Group income statement

for the six months ended 30 September 2019

 
                                  Six months ended 30 September              Six months ended 30 September 
                                               2019                                       2018 
                            Benchmark(1)  Non-benchmark(2)  Statutory  Benchmark(1)  Non-benchmark(2)  Statutory 
                                                                Total                                      Total 
                                    US$m              US$m       US$m          US$m              US$m       US$m 
Revenue (note 7(a))                2,495                 -      2,495         2,364                 -      2,364 
Total operating expenses 
 (note 9(a))                     (1,830)             (109)    (1,939)       (1,719)              (65)    (1,784) 
Operating profit/(loss)              665             (109)        556           645              (65)        580 
 
Interest income                        6                 -          6             5                 -          5 
Finance expense                     (72)              (51)      (123)          (61)              (58)      (119) 
                            ------------  ----------------  ---------  ------------  ----------------  --------- 
Net finance costs 
 (note 10(a))                       (66)              (51)      (117)          (56)              (58)      (114) 
Share of post-tax 
 profit of associates(3)               5                36         41             4                 -          4 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
Profit/(loss) before 
 tax (note 7(a))                     604             (124)        480           593             (123)        470 
Group tax (charge)/credit 
 (note 11(a))                      (158)                33      (125)         (150)                 1      (149) 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
Profit/(loss) for 
 the period                          446              (91)        355           443             (122)        321 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
 
 
Attributable to: 
Owners of Experian 
 plc                                 443              (91)        352           442             (122)        320 
Non-controlling interests              3                 -          3             1                 -          1 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
Profit/(loss) for 
 the period                          446              (91)        355           443             (122)        321 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
 
Total Benchmark EBIT(1)              670                 -        670           649                 -        649 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
 
 
                                US cents          US cents   US cents      US cents          US cents   US cents 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
Earnings/(loss) per 
 share (note 13(a)) 
Basic                               49.1            (10.1)       39.0          48.7            (13.4)       35.3 
Diluted                             48.7            (10.0)       38.7          48.3            (13.4)       34.9 
--------------------------  ------------  ----------------  ---------  ------------  ----------------  --------- 
 
 

1. Total Benchmark EBIT and other Benchmark items are non-GAAP measures, defined in note 6 to the condensed half-yearly financial statements.

2. The loss before tax for non-benchmark items of US$124m (2018: US$123m) is analysed in note 9 to the condensed half-yearly financial statements.

3. The non-benchmark share of post-tax profit of associates of US$36m (2018: US$nil) includes a gain of US$38m relating to a business disposal by an associate.

Condensed half-yearly financial statements

Group statement of comprehensive income

for the six months ended 30 September 2019

 
                                                    Six months ended 30 
                                                     September 
                                                 ------------------------ 
                                                        2019         2018 
                                                        US$m         US$m 
----------------------------------------------   -----------  ----------- 
 Profit for the period                                   355          321 
-----------------------------------------------  -----------  ----------- 
 Other comprehensive income 
 Items that will not be reclassified to 
  profit or loss: 
 Remeasurement of post-employment benefit 
  assets and obligations (note 16(b))                     44            8 
 Changes in the fair value of financial 
  assets revalued through OCI                              -          (2) 
 Items that will not be reclassified to 
  profit or loss                                          44            6 
-----------------------------------------------  -----------  ----------- 
 Items that may be reclassified subsequently 
  to profit or loss: 
 Currency translation losses                           (112)        (188) 
-----------------------------------------------  -----------  ----------- 
 Items that may be reclassified subsequently 
  to profit or loss                                    (112)        (188) 
-----------------------------------------------  -----------  ----------- 
 Other comprehensive income for the period(1)           (68)        (182) 
 Total comprehensive income for the period               287          139 
 
 Attributable to: 
 Owners of Experian plc                                  284          138 
 Non-controlling interests                                 3            1 
-----------------------------------------------  -----------  ----------- 
 Total comprehensive income for the period               287          139 
-----------------------------------------------  -----------  ----------- 
 
 
 

1. Amounts reported within Other comprehensive income (OCI) are in respect of continuing operations and, except as reported for post-employment benefit assets and obligations, there is no associated tax. Currency translation items are recognised in the translation reserve within other reserves. Other items within Other comprehensive income are recognised in retained earnings.

Condensed half-yearly financial statements

Group balance sheet

at 30 September 2019

 
                                                     30 September       31 March 
                                                 -------------------- 
                                                      2019       2018       2019 
                                          Notes       US$m       US$m       US$m 
---------------------------------------  ------  ---------  ---------  --------- 
 Non-current assets 
 Goodwill                                            4,507      4,276      4,324 
 Other intangible assets                             1,545      1,436      1,474 
 Property, plant and equipment                         519        315        333 
 Investments in associates                             155        126        122 
 Deferred tax assets                                   115        142        147 
 Post-employment benefit assets           16(a)        105         56         61 
 Trade and other receivables                           145         88        129 
 Financial assets revalued through 
  OCI                                                  164         94        103 
 Other financial assets                                168        172        154 
---------------------------------------  ------  ---------  ---------  --------- 
                                                     7,423      6,705      6,847 
---------------------------------------  ------  ---------  ---------  --------- 
 Current assets 
 Trade and other receivables                         1,018        989      1,055 
 Current tax assets                                     30         30         27 
 Other financial assets                                 10          7          9 
 Cash and cash equivalents                19(b)        146        175        149 
---------------------------------------  ------  ---------  ---------  --------- 
                                                     1,204      1,201      1,240 
---------------------------------------  ------  ---------  ---------  --------- 
 Current liabilities 
 Trade and other payables                          (1,139)    (1,183)    (1,464) 
 Borrowings                               19(b)    (1,140)      (550)      (869) 
 Current tax liabilities                             (272)      (333)      (313) 
 Provisions                                           (54)       (67)       (41) 
 Other financial liabilities                         (163)      (126)      (152) 
---------------------------------------  ------  ---------  ---------  --------- 
                                                   (2,768)    (2,259)    (2,839) 
---------------------------------------  ------  ---------  ---------  --------- 
 Net current liabilities                           (1,564)    (1,058)    (1,599) 
---------------------------------------  ------  ---------  ---------  --------- 
 Total assets less current liabilities               5,859      5,647      5,248 
---------------------------------------  ------  ---------  ---------  --------- 
 Non-current liabilities 
 Trade and other payables                            (102)       (91)       (99) 
 Borrowings                               19(b)    (3,166)    (2,965)    (2,455) 
 Deferred tax liabilities                            (160)      (157)      (132) 
 Post-employment benefit obligations      16(a)       (52)       (55)       (55) 
 Other financial liabilities                          (62)       (97)       (13) 
---------------------------------------  ------  ---------  ---------  --------- 
                                                   (3,542)    (3,365)    (2,754) 
---------------------------------------  ------  ---------  ---------  --------- 
 Net assets                                          2,317      2,282      2,494 
---------------------------------------  ------  ---------  ---------  --------- 
 
 Equity 
 Called-up share capital Share 
  capital                                  21           96         97         96 
 Share premium account                     21        1,572      1,558      1,559 
 Retained earnings                                  18,669     18,524     18,718 
 Other reserves                                   (18,027)   (17,907)   (17,893) 
---------------------------------------  ------  ---------  ---------  --------- 
 Attributable to owners of Experian 
  plc                                                2,310      2,272      2,480 
 Non-controlling interests                               7         10         14 
---------------------------------------  ------  ---------  ---------  --------- 
 Total equity                                        2,317      2,282      2,494 
---------------------------------------  ------  ---------  ---------  --------- 
 

Condensed half-yearly financial statements

Group statement of changes in total equity

for the six months ended 30 September 2019

 
                              Called-up      Share    Retained       Other   Attributable                       Total 
                                  share    premium    earnings    reserves      to owners                      equity 
                                capital    account                            of Experian   Non-controlling 
                                                                                      plc         interests 
                                   US$m       US$m        US$m        US$m           US$m              US$m      US$m 
---------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 At 1 April 2019                     96      1,559      18,718    (17,893)          2,480                14     2,494 
 Comprehensive income: 
 Total profit for the 
  period                              -          -         352           -            352                 3       355 
 Other comprehensive 
  income                              -          -          44       (112)           (68)                 -      (68) 
---------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 Total comprehensive 
  income                              -          -         396       (112)            284                 3       287 
---------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 Transactions with owners: 
 Employee share incentive 
  plans: 
 - value of employee 
  services                            -          -          33           -             33                 -        33 
 - shares issued on 
  vesting                             -         13           -           -             13                 -        13 
 - other vesting of 
  awards and exercises 
  of share options                    -          -        (57)          70             13                 -        13 
 - purchase of shares 
  by employee trusts                  -          -           -        (92)           (92)                 -      (92) 
 - other payments                     -          -         (5)           -            (5)                 -       (5) 
 Purchase and cancellation 
  of own shares                       -          -        (58)           -           (58)                 -      (58) 
 Transactions in respect 
  of non-controlling 
  interests                           -          -        (64)           -           (64)               (9)      (73) 
 Dividends paid                       -          -       (294)           -          (294)               (1)     (295) 
---------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 Transactions with owners             -         13       (445)        (22)          (454)              (10)     (464) 
---------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 At 30 September 2019                96      1,572      18,669    (18,027)          2,310                 7     2,317 
---------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 

Group statement of changes in total equity

for the six months ended 30 September 2018

 
                               Called-up      Share    Retained       Other   Attributable                       Total 
                                   share    premium    earnings    reserves      to owners                      equity 
                                 capital    account                            of Experian   Non-controlling 
                                                                                       plc         interests 
                                    US$m       US$m        US$m        US$m           US$m              US$m      US$m 
----------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 At 1 April 2018                      97      1,546      18,609    (17,775)          2,477                 7     2,484 
 Comprehensive income: 
 Total profit for the 
  period                               -          -         320           -            320                 1       321 
 Other comprehensive 
  income                               -          -           6       (188)          (182)                 -     (182) 
----------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 Total comprehensive 
  income                               -          -         326       (188)            138                 1       139 
----------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 Transactions with owners: 
 Employee share incentive 
  plans: 
 - value of employee 
  services                             -          -          41           -             41                 -        41 
 - shares issued on vesting            -         12           -           -             12                 -        12 
 - other vesting of awards 
  and exercises of share 
  options                              -          -        (50)          56              6                 -         6 
 - related tax charge                  -          -           4           -              4                 -         4 
 - other payments                      -          -         (4)           -            (4)                 -       (4) 
 Purchase and cancellation 
  of own shares                        -          -       (118)           -          (118)                 -     (118) 
 Transactions in respect 
  of non-controlling 
  interests                            -          -           -           -              -                 2         2 
 Dividends paid                        -          -       (284)           -          (284)                 -     (284) 
----------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 Transactions with owners              -         12       (411)          56          (343)                 2     (341) 
----------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 At 30 September 2018                 97      1,558      18,524    (17,907)          2,272                10     2,282 
----------------------------  ----------  ---------  ----------  ----------  -------------  ----------------  -------- 
 

Condensed half-yearly financial statements

Group cash flow statement

for the six months ended 30 September 2019

 
                                                Notes    Six months ended 30 
                                                              September 
                                                       ---------------------- 
                                                             2019        2018 
                                                             US$m        US$m 
---------------------------------------------  ------  ----------  ---------- 
 Cash flows from operating activities 
 Cash generated from operations                 17(a)         552         638 
 Interest paid                                               (72)        (57) 
 Interest received                                              3           2 
 Dividends received from associates                             4           2 
 Tax paid                                                   (146)        (84) 
---------------------------------------------  ------  ----------  ---------- 
 Net cash inflow from operating activities 
  - continuing operations                                     341         501 
 Net cash outflow from operating activities 
  - discontinued operations                        12         (7)        (32) 
---------------------------------------------  ------  ----------  ---------- 
 Net cash inflow from operating activities                    334         469 
---------------------------------------------  ------  ----------  ---------- 
 
 Cash flows from investing activities 
 Purchase of other intangible assets            17(c)       (191)       (151) 
 Purchase of property, plant and equipment                   (35)        (32) 
 Sale of property, plant and equipment                          3           1 
 Purchase of other financial assets                          (62)        (12) 
 Purchase of investment in associates                           -         (5) 
 Acquisition of subsidiaries, net of 
  cash acquired                                 17(d)       (353)         (3) 
 Net cash flows used in investing activities                (638)       (202) 
---------------------------------------------  ------  ----------  ---------- 
 
 Cash flows from financing activities 
 Cash inflow in respect of shares issued        17(e)          13          12 
 Cash outflow in respect of share purchases     17(e)       (150)       (119) 
 Other payments on vesting of share 
  awards                                                      (5)         (4) 
  Transactions in respect of non-controlling 
   interests                                                 (68)           2 
 New borrowings                                               839         529 
 Repayment of borrowings                                        -       (356) 
 Payment of lease liabilities                                (26)           - 
 Net payments for cross-currency swaps                       (14)           - 
  and foreign exchange contracts 
 Net receipts from equity swaps                                 5           3 
 Dividends paid                                             (295)       (284) 
---------------------------------------------  ------  ----------  ---------- 
 Net cash flows from/(used in) financing 
  activities                                                  299       (217) 
---------------------------------------------  ------  ----------  ---------- 
 
 Net (decrease)/increase in cash and 
  cash equivalents                                            (5)          50 
 Cash and cash equivalents at 1 April                         146         137 
 Exchange movements on cash and cash 
  equivalents                                                   2        (15) 
                                               ------ 
 Cash and cash equivalents at 30 September      17(f)         143         172 
---------------------------------------------  ------  ----------  ---------- 
 

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

1. Corporate information

Experian plc (the Company) is the ultimate parent company of the Experian group of companies (Experian or the Group). Experian is a leading global information services group.

The Company is incorporated and registered in Jersey as a public company limited by shares and is resident in Ireland. The Company's registered office is at 22 Grenville Street, St Helier, Jersey JE4 8PX, Channel Islands.

The Company's ordinary shares are traded on the London Stock Exchange's Regulated Market and have a Premium Listing.

There has been no change in this information since the Annual Report for the year ended 31 March 2019.

2. Basis of preparation

The condensed half-yearly financial statements are prepared on the going concern basis and in accordance with International Accounting Standard (IAS) 34 'Interim Financial Reporting' (IAS 34) as adopted by the European Union (the EU).

The condensed half-yearly financial statements:

-- comprise the consolidated results of the Group for the six months ended 30 September 2019 and 30 September 2018;

   --      were approved for issue on 11 November 2019; 

-- have not been audited but have been reviewed by the Company's auditor with their report set out on page 45; and

-- do not constitute the Group's statutory financial statements but should be read in conjunction with the Group's statutory financial statements for the year ended 31 March 2019.

No significant events impacting the Group, other than those disclosed in this document, have occurred between 30 September 2019 and 11 November 2019.

The Group's statutory financial statements comprise the Annual Report and audited financial statements which are prepared in accordance with International Financial Reporting Standards (IFRS or IFRSs) as adopted by the EU (EU-IFRS). The most recent such financial statements, for the year ended 31 March 2019, were approved by the directors on 14 May 2019 and subsequently delivered to the Jersey Registrar of Companies. The auditor's report was unqualified and did not contain a statement under Article 111(2) or Article 111(5) of the Companies (Jersey) Law 1991. Copies of these financial statements are available on the Company's website, at www.experianplc.com, and from the Company Secretary at Newenham House, Northern Cross, Malahide Road, Dublin 17, D17 AY61, Ireland.

The financial information for the year ended 31 March 2019 included in the condensed half-yearly financial statements is not the Company's statutory accounts for that financial year, but has been extracted from the Group's statutory financial statements.

As required by the UK Financial Conduct Authority Disclosure Guidance and Transparency Rules Sourcebook, these condensed half-yearly financial statements have been prepared applying the accounting policies and presentation that were applied in the preparation of the Group's statutory financial statements for the year ended 31 March 2019, except for the changes to accounting standards set out in note 3.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

3. Changes in accounting standards

IFRS 16 'Leases'

With effect from 1 April 2019, the Group has adopted IFRS 16 'Leases' which replaces IAS 17 'Leases'.

IFRS 16 removes the distinction between finance and operating leases, bringing the majority of leases onto the balance sheet for the first time. As a lessee, we have recognised both right-of-use assets and lease liabilities on our balance sheet, increasing both assets and financial liabilities.

In accordance with the IFRS 16 transition guidance, we have adopted the new rules using the modified retrospective approach which allows the matching of the opening right-of-use assets with the opening lease liabilities on 1 April 2019. Under this approach, no restatement of comparative information is required.

We have used the following practical expedients when adopting IFRS 16:

   --       Applied a single discount rate to a portfolio of leases with similar characteristics. 

-- Relied on our previous assessment as to whether leases are onerous under IAS 37 'Provisions, Contingent Liabilities and Contingent Assets', at 31 March 2019, rather than performing impairment tests on transition.

-- Excluded initial direct costs from the measurement of the right-of-use assets at 1 April 2019.

The weighted average incremental borrowing rate applied to lease liabilities on initial recognition at 1 April 2019 was 4.5%.

There was no material difference between the operating lease commitments disclosed at 31 March 2019 under IAS 17, discounted using the incremental borrowing rate on initial recognition, and the lease liabilities recognised in the Group balance sheet at 1 April 2019.

The impact of adoption on the Group's financial results is set out below. In addition, we have updated our definition of Net debt and Net funding to exclude lease liabilities.

 
                                           Six months ended 30 September 2019 
                                As reported under  IFRS 16 adjustment  As reported under 
                                           IAS 17                                IFRS 16 
Group income statement                       US$m                US$m               US$m 
Revenue                                     2,495                   -              2,495 
                                -----------------  ------------------  ----------------- 
IAS 17 Operating lease charge                (29)                  29                  - 
IFRS 16 Depreciation                            -                (24)               (24) 
Other operating expenses                  (1,915)                   -            (1,915) 
                                -----------------  ------------------  ----------------- 
Total operating expenses                  (1,944)                   5            (1,939) 
Operating profit                              551                   5                556 
 
Interest income                                 6                   -                  6 
Finance expense                             (118)                 (5)              (123) 
                                -----------------  ------------------  ----------------- 
Net finance costs                           (112)                 (5)              (117) 
Share of post-tax profit of 
 associates                                    41                   -                 41 
------------------------------  -----------------  ------------------  ----------------- 
Profit before tax                             480                   -                480 
Group tax charge                            (125)                   -              (125) 
------------------------------  -----------------  ------------------  ----------------- 
Profit for the period                         355                   -                355 
------------------------------  -----------------  ------------------  ----------------- 
 
Attributable to: 
Owners of Experian plc                        352                   -                352 
Non-controlling interests                       3                   -                  3 
------------------------------  -----------------  ------------------  ----------------- 
Profit for the period                         355                   -                355 
------------------------------  -----------------  ------------------  ----------------- 
 
Total Benchmark EBIT(1)                       665                   5                670 
------------------------------  -----------------  ------------------  ----------------- 
 

1. Total Benchmark EBIT is a non-GAAP measure, defined in note 6 to the condensed half-yearly financial statements.

The operating lease expense previously reported under IAS 17 on a straight-line basis has been replaced by depreciation of the right-of-use assets and interest on the lease liabilities.

We also made lease payments of US$6m in respect of low-value assets which continue to be recognised as an expense, on a straight-line basis, in the Group income statement. This treatment utilises the exemption available in IFRS 16 for such assets. We have chosen not to apply the exemption for short-term leases. We have no material sub-lease income.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

3. Changes in accounting standards (continued)

IFRS 16 'Leases' (continued)

 
                                At 31 March 2019  IFRS 16 adjustment  At 1 April 2019 
Group balance sheet (extract)               US$m                US$m             US$m 
Non-current assets 
Property, plant and equipment                333                 192              525 
Current assets 
Trade and other receivables                1,055                 (1)            1,054 
Current liabilities 
Trade and other payables                 (1,464)                   5          (1,459) 
Borrowings                                 (869)                (41)            (910) 
Non-current liabilities 
Trade and other payables                    (99)                   8             (91) 
Borrowings                               (2,455)               (163)          (2,618) 
Other                                      5,993                   -            5,993 
Net assets                                 2,494                   -            2,494 
------------------------------  ----------------  ------------------  --------------- 
 
 
Total equity                               2,494                   -            2,494 
------------------------------  ----------------  ------------------  --------------- 
 

The Group's lease portfolio consists of 33 significant property leases across the countries in which we operate. In addition, we lease approximately 170 smaller properties, 800 motor vehicles, and a small number of hardware assets. At 30 September 2019 we hold right-of-use assets with a net book value of US$206m comprising property assets of US$174m and US$32m for plant and equipment. The corresponding lease liabilities at 30 September 2019 are valued at US$222m split between current (US$50m) and non-current (US$172m) borrowings in the Group balance sheet.

The Group's future commitments for leases committed to but not yet commenced total US$7m and do not form part of the lease liabilities or right-of-use assets.

 
 Lease liability analysis by maturity 
 Six months ended 30 September 2019      US$m 
--------------------------------------  ----- 
 Less than one year                        50 
 One to two years                          45 
 Two to three years                        37 
 Three to four years                       31 
 Four to five years                        15 
 Over five years                           44 
                                          222 
--------------------------------------  ----- 
 

In the Group cash flow statement, principal lease payments are now presented within cash flows used in financing with the associated interest recorded as a cash outflow from operating activities. Previously lease payments were recognised as cash outflows from operating activities. During the six months ended 30 September 2019, we recognised total payments for leases of US$30m which comprised US$26m for repayments of principal and US$4m for payments of interest.

 
 
 

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

4. Accounting policies, estimates and judgments

(a) Introduction

The preparation of the condensed half-yearly financial statements requires management to make estimates and assumptions that affect the reported amount of revenues, expenses, assets, liabilities and the disclosure of contingent liabilities. If in the future such estimates and assumptions, which are based on management's best judgment at the date of these condensed half-yearly financial statements, deviate from actual circumstances, the original estimates and assumptions will be modified as appropriate in the period in which the circumstances change. There have been no significant changes in the bases upon which estimates have been determined, compared to those applied at 31 March 2019, and no change in estimate has had a material effect on the current period.

Except as described in note 3, the accounting policies applied in the condensed half-yearly financial statements are the same as those applied in the Annual Report and Group financial statements for the year ended 31 March 2019.

(b) Goodwill

Goodwill held in the Group's balance sheet is tested annually for impairment and details of the methodology used are set out in the Group's statutory financial statements for the year ended 31 March 2019.

During the six months ended 30 September 2019 the annual tests were performed with no impairment identified.

(c) Post-employment benefits (note 16)

We have updated the accounting valuation of our principal defined benefit pension plan in light of changes in the key actuarial assumptions, and this is recognised in the condensed half-yearly financial statements. The actuarial assumption with the most significant impact at 30 September 2019 is the discount rate of 1.8% (2018: 2.7%). The discount rate used in the year ended 31 March 2019 was 2.3%.

(d) Revenue recognition (note 7)

Revenue is stated net of any sales taxes, rebates and discounts.

Revenue is recognised to represent the transfer of promised services to customers in a way that reflects the consideration expected to be received in return. Total consideration from contracts with customers is allocated to the performance obligations identified based on their standalone selling price, and is recognised when those performance obligations are satisfied and the control of goods or services is transferred to the customer, either over time or at a point in time.

-- Revenue in respect of the provision and processing of transactional data is recognised in the period in which the service is provided.

-- Revenue from batch data arrangements which include an ongoing update service are apportioned across each delivery to the customer.

-- Subscription and membership fees are recognised on a straight-line basis over the period to which they relate.

-- Software licence and delivery services are primarily accounted for as a single performance obligation, with revenue recognised when the combined offering is delivered to the customer. These services are distinguished between Experian-hosted solutions, where revenue is spread over the period that the service is available to the customer, and on-premise software licence arrangements, where revenue is recognised on delivery completion.

-- The delivery of support and maintenance agreements is generally considered to be a separate performance obligation and revenue is recognised on a straight-line basis over the term of the maintenance period.

-- Professional services revenues which form a separate performance obligation are recognised as the services are delivered.

Sales are typically invoiced in the geographic area in which the customer is located. As a result, the geographic location of the invoicing undertaking is used to attribute revenue to individual countries.

Accrued income balances, which represent the right to consideration in exchange for goods or services that we have transferred to a customer, are assessed as to whether they meet the definition of a contract asset:

-- When the right to consideration is conditional on something other than the passage of time, a balance is classified as a contract asset. This arises where there are further performance obligations to be satisfied as part of the contract with the customer and typically includes balances relating to software licensing contracts;

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

4. Accounting policies, estimates and judgments (continued)

(d) Revenue recognition (note 7) (continued)

-- When the right to consideration is conditional only on the passage of time, the balance does not meet the definition of a contract asset and is classified as an unbilled receivable. This typically arises where the timing of the related billing cycle occurs in a period after the performance obligation is satisfied.

Certain costs incurred prior to the satisfaction or partial-satisfaction of a performance obligation are also deferred as contract costs and these are amortised on a systematic basis consistent with the pattern of transfer of the related goods or services.

   --       Costs to obtain a contract predominantly comprise sales commissions costs. 
   --       Costs to fulfil a contract predominantly comprise of labour costs directly relating to the implementation services provided. 

Contract liabilities arise when we have an obligation to transfer future goods or services to a customer for which we have received consideration, or the amount is due, from the customer and include both deferred income balances and specific reserves.

(e) Tax (note 11)

The tax charge recognised in the period is derived from the estimated tax rate for the full year, taking account of one-off tax charges and credits arising in the period and expected to arise in the full year and the tax effect of Exceptional items and other adjustments made to derive Benchmark PBT.

(f) Leases

The Group undertakes an assessment of whether a contract is or contains a lease at its inception. The assessment establishes whether the Group obtains substantially all the economic benefits from the use of an asset and whether we have the right to direct its use.

Low-value lease payments are recognised as an expense, on a straight-line basis over the lease term. For other leases we recognise both a right-of-use asset and a lease liability at the commencement date of a lease contract.

The right-of-use asset is initially measured at cost, comprising the initial amount of the lease liability adjusted for payments made at or before the commencement date, plus initial direct costs and an estimate of the cost of any obligation to refurbish the asset or site, less lease incentives.

Subsequently, right-of-use assets are measured at cost less accumulated depreciation and impairment losses and are adjusted for any remeasurement of the lease liability. Depreciation is calculated on a straight-line basis over the lower of the useful life of the right-of-use asset and the period of the lease.

The lease term comprises the non-cancellable period of a lease, plus periods covered by an extension option, if it is reasonably certain to be exercised, and periods covered by a termination option if it is reasonably certain not to be exercised.

The lease liability is initially measured at the present value of lease payments that are not paid at the commencement date, discounted at the interest rate implicit in the lease or if that rate cannot be easily determined the Group's incremental borrowing rate.

Lease payments comprise payments of fixed principal, less any lease incentives, variable elements linked to an index, guaranteed residuals or buy-out options that are reasonably certain to be exercised. It includes payments in respect of optional renewal periods where these are reasonably certain to be exercised or early termination payments where the lease term reflects such an option.

The lease liability is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group's estimate of the amount expected to be payable under a residual value guarantee or if the Group changes its assessment of whether it will exercise a purchase, extension or termination option.

When a lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the right-of-use asset or is recognised in the Group income statement if the asset is fully depreciated.

The Group presents right-of-use assets within property, plant and equipment and lease liabilities within borrowings in the Group balance sheet.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

5. Accounting developments

There are no new standards, amendments to existing standards or interpretations that are not yet effective that would be expected to have a material impact on the Group. Such developments are routinely reviewed by the Group and its financial reporting systems are adapted as appropriate.

6. Use of non-GAAP measures in the condensed half-yearly financial statements

As detailed below, the Group has identified and defined certain measures that it uses to understand and manage its performance. The measures are not defined under IFRS and they may not be directly comparable with other companies' adjusted measures. These non-GAAP measures are not intended to be a substitute for any IFRS measures of performance but management has included them as they consider them to be key measures used within the business for assessing the underlying performance of the Group's ongoing businesses.

(a) Benchmark profit before tax (Benchmark PBT) (note 7(a) and note 8)

Benchmark PBT is disclosed to indicate the Group's underlying profitability. It is defined as profit before amortisation and impairment of acquisition intangibles, impairment of goodwill, acquisition expenses, adjustments to contingent consideration, Exceptional items, financing fair value remeasurements, tax (and interest thereon) and discontinued operations. It includes the Group's share of continuing associates' Benchmark post-tax results.

An explanation of the basis on which we report Exceptional items is provided below. Other adjustments made to derive Benchmark PBT are explained as follows:

-- Charges for the amortisation and impairment of acquisition intangibles are excluded from the calculation of Benchmark PBT because these charges are based on judgments about their value and economic life and bear no relation to the Group's underlying ongoing performance. Impairment of goodwill is similarly excluded from the calculation of Benchmark PBT.

-- Acquisition and disposal expenses (representing the incidental costs of acquisitions and disposals, one-time integration costs and other corporate transaction expenses) relating to successful, active or aborted acquisitions and disposals are excluded from the definition of Benchmark PBT as they bear no relation to the Group's underlying ongoing performance or to the performance of any acquired businesses. Adjustments to contingent consideration are similarly excluded from the definition of Benchmark PBT.

-- Charges and credits for financing fair value remeasurements within finance expense in the Group income statement are excluded from the definition of Benchmark PBT. These include retranslation of intra-Group funding, and that element of the Group's derivatives that is ineligible for hedge accounting, together with gains and losses on put options in respect of acquisitions. Amounts recognised generally arise from market movements and accordingly bear no direct relation to the Group's underlying performance.

(b) Benchmark earnings before interest and tax (Benchmark EBIT) and margin (Benchmark EBIT margin) (note 7(a))

Benchmark EBIT is defined as Benchmark PBT before the net interest expense charged therein and accordingly excludes Exceptional items as defined below. Benchmark EBIT margin is Benchmark EBIT from ongoing activities expressed as a percentage of revenue from ongoing activities.

(c) Benchmark earnings before interest, tax, depreciation and amortisation (Benchmark EBITDA)

Benchmark EBITDA is defined as Benchmark EBIT before the depreciation and amortisation charged therein.

(d) Exited business activities

Exited business activities are businesses sold, closed or identified for closure during a financial year. These are treated as exited business activities for both revenue and Benchmark EBIT purposes. The results of exited business activities are disclosed separately with the results of the prior period re-presented in the segmental analyses as appropriate. This measure differs from the definition of discontinued operations in IFRS 5.

(e) Ongoing activities

The results of businesses trading at 30 September 2019, which are not disclosed as exited business activities, are reported as ongoing activities.

(f) Constant exchange rates

To highlight our organic performance, we discuss our results in terms of growth at constant exchange rates, unless otherwise stated. This represents growth calculated after translating both years' performance at the prior year's average exchange rates.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

6. Use of non-GAAP measures in the condensed half-yearly financial statements (continued)

(g) Total growth (note 7(c))

This is the year-on-year change in the performance of our activities at actual exchange rates. Total growth at constant exchange rates removes the translational foreign exchange effects arising on the consolidation of our activities and comprises one of our measures of performance at constant exchange rates.

(h) Organic revenue growth (note 7(c))

This is the year-on-year change in the revenue of ongoing activities, translated at constant exchange rates, excluding acquisitions until the first anniversary of their consolidation.

(i) Benchmark earnings and Total Benchmark earnings (note 13)

Benchmark earnings comprise Benchmark PBT less attributable tax and non-controlling interests. The attributable tax for this purpose excludes significant tax credits and charges arising in the year which, in view of their size or nature, are not comparable with previous years, together with tax arising on Exceptional items and on other adjustments made to derive Benchmark PBT. Benchmark PBT less attributable tax is designated as Total Benchmark earnings.

(j) Benchmark earnings per share (Benchmark EPS) (note 13(a))

Benchmark EPS comprises Benchmark earnings divided by the weighted average number of issued ordinary shares, as adjusted for own shares held.

(k) Benchmark PBT per share

Benchmark PBT per share comprises Benchmark PBT divided by the weighted average number of issued ordinary shares, as adjusted for own shares held.

(l) Benchmark tax charge and rate (note 11(b))

The Benchmark tax charge is the tax charge applicable to Benchmark PBT. It differs from the Group tax charge by tax attributable to Exceptional items and other adjustments made to derive Benchmark PBT, and exceptional tax charges. A reconciliation is provided in note 11(b) to these condensed half-yearly financial statements. The Benchmark effective rate of tax is calculated by dividing the Benchmark tax charge by Benchmark PBT.

(m) Exceptional items

The separate reporting of Exceptional items gives an indication of the Group's underlying performance. Exceptional items include those arising from the profit or loss on disposal of businesses, closure costs of major business units, costs of significant restructuring programmes and other financially significant one-off items. All other restructuring costs are charged against Benchmark EBIT, in the segments in which they are incurred.

(n) Benchmark operating and Benchmark free cash flow

Benchmark operating cash flow is Benchmark EBIT plus amortisation, depreciation and charges in respect of share-based incentive plans, less capital expenditure net of disposal proceeds and adjusted for changes in working capital, principal lease payments and the Benchmark profit or loss retained in continuing associates. Benchmark free cash flow is derived from Benchmark operating cash flow by excluding net interest, tax paid in respect of continuing operations and dividends paid to non-controlling interests.

(o) Cash flow conversion

Cash flow conversion is Benchmark operating cash flow expressed as a percentage of Benchmark EBIT.

(p) Net debt and Net funding (note 19)

Net debt is borrowings (and the fair value of derivatives hedging borrowings) excluding lease liabilities and accrued interest, less cash and cash equivalents and other highly liquid bank deposits with original maturities greater than three months. Net funding is borrowings (and the fair value of the effective portion of derivatives hedging borrowings) excluding lease liabilities and accrued interest, less cash held in Group Treasury.

(q) Return on capital employed (ROCE)

ROCE is defined as Benchmark EBIT less tax at the Benchmark rate divided by a three-point average of capital employed, in continuing operations, over the year. Capital employed is net assets less non-controlling interests, further adjusted to add or deduct the net tax liability or asset and to add Net debt.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

7. Segment information

 
 (a) Income statement 
                                   North      Latin     UK and      EMEA/        Total       Central         Total 
                                 America    America    Ireland       Asia    operating    Activities    continuing 
                                                                  Pacific     segments                  operations 
 Six months ended 30                US$m       US$m       US$m       US$m         US$m          US$m          US$m 
 September 
 2019 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 
 Revenue from external 
  customers                        1,573        352        371        199        2,495             -         2,495 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 
 Reconciliation from 
 Benchmark 
 EBIT to 
 profit/(loss) before tax 
 Benchmark EBIT                      544         97         75        (5)          711          (41)           670 
 Net interest expense 
  included 
  in Benchmark PBT 
  (note 10(b))                       (2)        (1)        (1)        (1)          (5)          (61)          (66) 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 Benchmark PBT                       542         96         74        (6)          706         (102)           604 
 Exceptional items (note 
  9(a))                             (35)          -          -          -         (35)             -          (35) 
 Amortisation of acquisition 
  intangibles                       (42)        (8)        (4)        (5)         (59)             -          (59) 
 Acquisition expenses                (4)          -        (4)        (8)         (16)             -          (16) 
 Adjustment to the fair 
  value of contingent 
  consideration                        -          -          1          -            1             -             1 
 Non-benchmark share of 
  post-tax profit of 
  associates                           -          -          -          -            -            36            36 
 Interest on uncertain 
  tax provisions (note 10(a))          -          -          -          -            -           (7)           (7) 
 Financing fair value 
  remeasurements 
  (note 10(c))                         -          -          -          -            -          (44)          (44) 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 Profit/(loss) before tax            461         88         67       (19)          597         (117)           480 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 
                                   North      Latin     UK and      EMEA/        Total       Central         Total 
                                 America    America    Ireland       Asia    operating    Activities    continuing 
                                                                  Pacific     segments                  operations 
 Six months ended 30                US$m       US$m       US$m       US$m         US$m          US$m          US$m 
 September 
 2018 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 Revenue from external 
  customers 
 Ongoing activities                1,430        339        393        199        2,361             -         2,361 
 Exited business activities            -          -          3          -            3             -             3 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 Total                             1,430        339        396        199        2,364             -         2,364 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 
 Reconciliation from 
 Benchmark 
 EBIT to 
 profit/(loss) before tax 
 Benchmark EBIT 
 Ongoing activities                  492         98        101        (9)          682          (35)           647 
 Exited business activities            -          -          2          -            2             -             2 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 Total                               492         98        103        (9)          684          (35)           649 
 Net interest expense 
  included 
  in Benchmark PBT 
  (note 10(b))                         -          -          -          -            -          (56)          (56) 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 Benchmark PBT                       492         98        103        (9)          684          (91)           593 
 Amortisation of acquisition 
  intangibles                       (40)        (9)        (5)        (2)         (56)             -          (56) 
 Acquisition expenses                (3)          -        (3)          -          (6)             -           (6) 
 Adjustment to the fair 
  value of contingent 
  consideration                      (3)          -          -          -          (3)             -           (3) 
 Interest on uncertain 
  tax provisions (note 10(a))          -          -          -          -            -           (7)           (7) 
 Financing fair value 
  remeasurements 
  (note 10(c))                         -          -          -          -            -          (51)          (51) 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 Profit/(loss) before tax            446         89         95       (11)          619         (149)           470 
-----------------------------  ---------  ---------  ---------  ---------  -----------  ------------  ------------ 
 
 
 

The results for the six months ended 30 September 2018 have been restated following the reclassification to exited business activities of certain B2B businesses.

Additional information by operating segment, including that on total and organic growth at constant exchange rates, and the disaggregation of revenue from contracts with customers, is provided within pages 3 to 9.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

7. Segment information (continued)

(b) Revenue by business segment

The additional analysis of revenue from external customers provided to the chief operating decision-maker and accordingly reportable under IFRS 8 'Operating segments' is given within note 8. This is supplemented by voluntary disclosure of the profitability of groups of service lines. For ease of reference, we continue to use the term 'business segments' when discussing the results of groups of service lines.

(c) Reconciliation of revenue from ongoing activities

 
                                                    North      Latin     UK and      EMEA/         Total 
                                                  America    America    Ireland       Asia       ongoing 
                                                                                   Pacific    activities 
                                                     US$m       US$m       US$m       US$m          US$m 
---------------------------------------------   ---------  ---------  ---------  ---------  ------------ 
 Revenue for the six months ended 30 
  September 2018(1)                                 1,430        339        393        199         2,361 
 Adjustment to constant exchange rates                (1)        (3)        (4)        (3)          (11) 
----------------------------------------------  ---------  ---------  ---------  ---------  ------------ 
 Revenue at constant rates for the six 
  months ended 30 September 2018                    1,429        336        389        196         2,350 
 Organic revenue growth                               137         32        (1)        (6)           162 
 Revenue from acquisitions                              7          -          1         16            24 
 Revenue at constant rates for the six 
  months ended 30 September 2019                    1,573        368        389        206         2,536 
 Adjustment to actual exchange rates                    -       (16)       (18)        (7)          (41) 
 Revenue for the six months ended 30 
  September 2019                                    1,573        352        371        199         2,495 
----------------------------------------------  ---------  ---------  ---------  ---------  ------------ 
 
 Organic revenue growth at constant exchange 
  rates                                               10%        10%          -       (3%)            7% 
 Revenue growth at constant exchange 
  rates                                               10%        10%          -         5%            8% 
----------------------------------------------  ---------  ---------  ---------  ---------  ------------ 
 

1. The results for the six months ended 30 September 2018 have been restated following the reclassification to exited business activities of certain B2B businesses.

The above table demonstrates the application of the methodology set out in note 6 in determining organic and total revenue growth at constant exchange rates.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

8. Information on business segments (including non-GAAP disclosures)

 
                                         Business-to-    Consumer       Total       Central         Total 
                                             Business    Services    business    Activities    continuing 
                                                                     segments                  operations 
 Six months ended 30 September                   US$m        US$m        US$m          US$m          US$m 
  2019 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 
 Revenue from external customers                1,955         540       2,495             -         2,495 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 
 Reconciliation from Benchmark 
  EBIT to 
  profit/(loss) before tax 
 Benchmark EBIT                                   586         125         711          (41)           670 
 Net interest expense included 
  in Benchmark PBT (note 10(b))                   (4)         (1)         (5)          (61)          (66) 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 Benchmark PBT                                    582         124         706         (102)           604 
 Exceptional items (note 9(a))                   (35)           -        (35)             -          (35) 
 Amortisation of acquisition 
  intangibles                                    (49)        (10)        (59)             -          (59) 
 Acquisition expenses                            (14)         (2)        (16)             -          (16) 
 Adjustment to the fair value 
  of contingent consideration                       1           -           1             -             1 
 Non-benchmark share of post-tax 
  profit of associates                              -           -           -            36            36 
 Interest on uncertain tax provisions 
  (note 10(a))                                      -           -           -           (7)           (7) 
 Financing fair value remeasurements 
  (note 10(c))                                      -           -           -          (44)          (44) 
 Profit/(loss) before tax                         485         112         597         (117)           480 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 
                                                         Consumer       Total       Central         Total 
                                         Business-to-    Services    business    Activities    continuing 
                                             Business                segments                  operations 
 Six months ended 30 September                   US$m        US$m        US$m          US$m          US$m 
  2018 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 Revenue from external customers 
 Ongoing activities                             1,875         486       2,361             -         2,361 
 Exited business activities                         3           -           3             -             3 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 Total                                          1,878         486       2,364             -         2,364 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 Reconciliation from Benchmark 
  EBIT to 
  profit/(loss) before tax 
 Benchmark EBIT 
 Ongoing activities                               561         121         682          (35)           647 
 Exited business activities                         2           -           2             -             2 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 Total                                            563         121         684          (35)           649 
 Net interest expense included 
  in Benchmark PBT (note 10(b))                     -           -           -          (56)          (56) 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 Benchmark PBT                                    563         121         684          (91)           593 
 Amortisation of acquisition 
  intangibles                                    (47)         (9)        (56)             -          (56) 
 Acquisition expenses                             (5)         (1)         (6)             -           (6) 
 Adjustment to the fair value 
  of contingent consideration                     (3)           -         (3)             -           (3) 
 Interest on uncertain tax provisions 
  (note 10 (a))                                     -           -           -           (7)           (7) 
 Financing fair value remeasurements 
  (note 10(c))                                      -           -           -          (51)          (51) 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 Profit/(loss) before tax                         508         111         619         (149)           470 
--------------------------------------  -------------  ----------  ----------  ------------  ------------ 
 

The results for the six months ended 30 September 2018 have been restated following the reclassification to exited business activities of certain B2B businesses.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

9. Exceptional items and other adjustments made to derive Benchmark PBT

(a) Charge for Exceptional items and other adjustments made to derive Benchmark PBT

 
                                                          Six months ended 30 
                                                                    September 
                                                       ---------------------- 
                                                             2019        2018 
                                                             US$m        US$m 
----------------------------------------------------   ----------  ---------- 
 
 Exceptional items: 
 Legal provisions movements (note 9(b))                        35           - 
----------------------------------------------------   ----------  ---------- 
 Charge for Exceptional items                                  35           - 
----------------------------------------------------   ----------  ---------- 
 
 Other adjustments made to derive Benchmark 
  PBT: 
 Amortisation of acquisition intangibles                       59          56 
 Acquisition expenses                                          16           6 
 Adjustment to the fair value of contingent 
  consideration                                               (1)           3 
 Non-benchmark share of post-tax profit of                   (36)           - 
  associates 
 Interest on uncertain tax provisions                           7           7 
 Financing fair value remeasurements (note 
  10(c))                                                       44          51 
-----------------------------------------------------  ----------  ---------- 
 Charge for other adjustments made to derive 
  Benchmark PBT                                                89         123 
-----------------------------------------------------  ----------  ---------- 
 Charge for Exceptional items and other adjustments 
  made to derive Benchmark PBT                                124         123 
-----------------------------------------------------  ----------  ---------- 
 
 By income statement caption: 
 Within total operating expenses                              109          65 
 Within operating profit                                      109          65 
 Within share of post-tax profit of associates               (36)           - 
 Within finance expense                                        51          58 
-----------------------------------------------------  ----------  ---------- 
 Charge for Exceptional items and other adjustments 
  made to derive Benchmark PBT                                124         123 
-----------------------------------------------------  ----------  ---------- 
 

(b) Legal provisions movements

During the six months ended 30 September 2019, there has been a movement in provisions in respect of a number of historic legal claims.

10. Net finance costs

 
 (a) Net finance costs included in profit 
  before tax 
                                                     Six months ended 30 September 
                                                   -------------------------------- 
                                                       2019                    2018 
                                                       US$m                    US$m 
------------------------------------------------   --------  ---------------------- 
 Interest income: 
 Bank deposits, short-term investments and 
  loan notes                                            (6)                     (5) 
 
 Finance expense: 
 Interest expense                                        67                      61 
 Charge in respect of financing fair value 
  remeasurements (note 10(c))                            44                      51 
 Interest on uncertain tax provisions                     7                       7 
 Interest on leases                                       5                       - 
-------------------------------------------------  --------  ---------------------- 
 Finance expense                                        123                     119 
-------------------------------------------------  --------  ---------------------- 
 
 Net finance costs included in profit before 
  tax                                                   117                     114 
-------------------------------------------------  --------  ---------------------- 
 
 (b) Net interest expense included in Benchmark 
  PBT 
                                                     Six months ended 30 September 
                                                   -------------------------------- 
                                                       2019                    2018 
                                                       US$m                    US$m 
------------------------------------------------   --------  ---------------------- 
 Interest income                                        (6)                     (5) 
 Interest expense                                        72                      61 
-------------------------------------------------  --------  ---------------------- 
 
 Net interest expense included in Benchmark 
  PBT                                                    66                      56 
-------------------------------------------------  --------  ---------------------- 
 
 

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

10. Net finance costs (continued)

(c) Analysis of charge in respect of financing fair value remeasurements

 
                                                 Six months ended 30 September 
                                               -------------------------------- 
                                                          2019             2018 
                                                          US$m             US$m 
-------------------------------------------    ---------------  --------------- 
 Foreign exchange losses on Brazilian real 
  intra-Group funding                                       15               44 
 Increase in the fair value of put options                   -                3 
 Other financing fair value losses                          29                4 
---------------------------------------------  ---------------  --------------- 
 
 Charge in respect of financing fair value 
  remeasurements                                            44               51 
---------------------------------------------  ---------------  --------------- 
 

Brazilian real intra-Group funding provided to Serasa S.A., from a Group company whose functional currency is not the Brazilian real, is not considered permanent and foreign exchange gains or losses on this funding are recognised in the Group income statement.

11. Tax - ongoing activities

(a) Group tax charge and effective rate of tax

 
                                                  Six months ended 30 September 
                                                -------------------------------- 
                                                           2019             2018 
                                                           US$m             US$m 
----------------------------------------------  ---------------  --------------- 
 Group tax charge                                           125              149 
 Profit before tax                                          480              470 
----------------------------------------------  ---------------  --------------- 
 Effective rate of tax based on Profit before 
  tax                                                     26.0%            31.7% 
----------------------------------------------  ---------------  --------------- 
 

(b) Reconciliation of the Group tax charge to the Benchmark tax charge

 
                                                     Six months ended 30 September 
                                                  --------------------------------- 
                                                              2019             2018 
                                                              US$m             US$m 
------------------------------------------------  ----------------  --------------- 
 Group tax charge                                              125              149 
 Tax relief on other adjustments made to derive 
  Benchmark PBT                                                 33                1 
 Benchmark tax charge                                          158              150 
------------------------------------------------  ----------------  --------------- 
 
 Benchmark PBT                                                 604              593 
------------------------------------------------  ----------------  --------------- 
 Benchmark tax rate                                          26.2%            25.3% 
------------------------------------------------  ----------------  --------------- 
 

12. Discontinued operations

There have been no material divestments during the six months ended 30 September 2019. On 31 May 2017 we completed the divestment of our email/cross-channel marketing business (CCM), and the results and cash flows of that business were accordingly classified as discontinued.

The cash outflow from operating activities of US$7m (2018:US$32m) relates to CCM and is stated after tax paid of US$nil (2018: US$21m).

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

13. Earnings per share disclosures

 
 (a) Earnings per share (EPS) 
                                                      Six months ended 30 September 
                                                       Basic                 Diluted 
                                              ----------------------  --------------------- 
                                                     2019       2018        2019       2018 
                                                 US cents   US cents    US cents   US cents 
--------------------------------------------  -----------  ---------  ----------  --------- 
 Continuing operations                               39.0       35.3        38.7       34.9 
 Add: Exceptional items and other 
  adjustments made to derive Benchmark 
  PBT, net of related tax                            10.1       13.4        10.0       13.4 
--------------------------------------------  -----------  ---------  ----------  --------- 
 Benchmark EPS (non-GAAP measure)                    49.1       48.7        48.7       48.3 
--------------------------------------------  -----------  ---------  ----------  --------- 
 
 (b) Analysis of earnings 
                                                                         Six months ended 
                                                                           30 September 
                                                                      --------------------- 
                                                                            2019       2018 
                                                                            US$m       US$m 
                                                                      ---------- 
Continuing operations attributable to owners of 
 Experian plc                                                                352        320 
Add: Exceptional items and other adjustments 
 made to derive Benchmark PBT, net of related 
 tax                                                                          91        122 
                                                           ---------  ----------  --------- 
Benchmark earnings attributable to owners of Experian 
 plc (non-GAAP measure)                                                      443        442 
Benchmark earnings attributable to non-controlling 
 interests (non-GAAP measure)                                                  3          1 
 
Total Benchmark earnings (non-GAAP 
 measure)                                                                    446        443 
 
(c) Reconciliation of Total Benchmark earnings 
 to profit for the period 
                                                                         Six months ended 
                                                                           30 September 
                                                                      --------------------- 
                                                                            2019       2018 
                                                                            US$m       US$m 
--------------------------------------------  -----------  ---------  ----------  --------- 
 Total Benchmark earnings (non-GAAP 
  measure)                                                                   446        443 
Loss from Exceptional items and other adjustments 
 made to derive 
 Benchmark PBT, net of related tax                                          (91)      (122) 
                                                                      ----------  --------- 
Profit for the period                                                        355        321 
 
 
 
(d) Weighted average number of ordinary 
 shares 
                                                     Six months 
                                                        ended 
                                                    30 September 
                                                        2019     2018 
                                                     million  million 
 
Weighted average number of ordinary shares               903      907 
Add: dilutive effect of share incentive 
 awards, options and share purchases                       7        9 
 
Diluted weighted average number of ordinary 
 shares                                                  910      916 
 
 
 

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

14. Dividends

 
                                        Six months ended 30 September 
                                        2019      2019          2018      2018 
                                    US cents                US cents 
                                   per share      US$m     per share      US$m 
Amounts recognised and paid: 
Second interim - paid in 
 July 2019 (2018: July)                32.50       294         31.25       284 
 
First interim - announced              14.50       131         14.00       126 
                                              -------- 
 
 

A first interim dividend of 14.5 US cents per ordinary share will be paid on 31 January 2020 to shareholders on the register at the close of business on 3 January 2020 and is not included as a liability in these condensed half-yearly financial statements. The announced dividend payment of 14.5 US cents per ordinary share is a gross amount. The first interim dividend for the six months ended 30 September 2018 was 14.0 US cents per ordinary share and the total dividend per ordinary share for the year ended 31 March 2019 was 46.5 US cents with a total full year cost of US$420m.

15. Capital expenditure, disposals and capital commitments

(a) Additions

During the six months ended 30 September 2019, the Group recognised capital additions of US$259m (2018: US$183m), comprising capital expenditure of US$226m (2018: US$183m) and right-of-use asset additions of US$33m (2018: US$nil).

(b) Disposals

Excluding any amounts in connection with the disposal of businesses, the book value of other intangible fixed assets and property, plant and equipment disposed of in the six months ended 30 September 2019 was US$3m (2018: US$2m), there was no profit or loss on disposal (2018: loss on disposal US$1m).

(c) Capital commitments

At 30 September 2019, the Group had capital commitments in respect of intangible assets and property, plant and equipment for which contracts had been placed of US$39m (2018: US$21m). Capital commitments at 30 September 2019 include commitments of US$1m not expected to be incurred before 30 September 2020. Capital commitments at 30 September 2018 included commitments of US$5m not then expected to be incurred before 30 September 2019.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

16. Post-employment benefit assets and obligations - defined benefit plans

 
(a) Amounts recognised in the Group balance sheet 
                                                                         30 September 
                                                                          2019      2018 
                                                                          US$m      US$m 
Retirement benefit assets/(obligations) - funded 
 plans: 
Fair value of funded plans' assets                                       1,160     1,088 
Present value of funded plans' obligations                             (1,055)   (1,032) 
Assets in the Group balance sheet for funded 
 defined benefit pensions                                                  105        56 
 
Obligations for unfunded post-employment benefits: 
Present value of defined benefit pensions - 
 unfunded plans                                                           (48)      (50) 
Present value of post-employment medical benefits                          (4)       (5) 
Liabilities in the Group balance sheet                                    (52)      (55) 
Net post-employment benefit assets                                          53         1 
The net retirement benefit assets of US$6m at 1 April 2019 comprised 
 assets of US$61m in respect of funded plans and obligations of US$55m 
 in respect of unfunded plans. The retirement benefit assets and 
 obligations are denominated primarily in pounds sterling. 
 
 (b) Movements in net post-employment benefit assets/(obligations) 
 recognised in the Group balance sheet 
 
                                                                       Six months ended 
                                                                         30 September 
                                                                          2019      2018 
 
                                                                          US$m      US$m 
At 1 April                                                                   6      (11) 
Charge to the Group income statement within 
 total operating expenses                                                  (4)       (5) 
Remeasurements recognised within Other comprehensive 
income                                                                      44         8 
Differences on exchange                                                    (2)         - 
Contributions paid by the Group                                              9         9 
At 30 September                                                             53         1 
 
There was a small funding deficit at the date of the 2016 full actuarial 
 valuation of the Experian Pension Scheme in the UK. To correct the 
 shortfall the employer has agreed to pay deficit contributions of 
 US$4m per annum over five years from 1 April 2017. Deficit contributions 
 of US$4m were paid in the six months ended 30 September 2019 (2018: 
 US$4m). 
 
 It is anticipated that agreement will be reached on the 2019 actuarial 
 valuation prior to 31 March 2020, the results of which will then 
 be reflected in the Group's statutory financial statements for that 
 year. 
 
 (c) Actuarial assumptions 
                                                                         30 September 
                                                                          2019      2018 
                                                                             %  % 
Discount rate                                                              1.8       2.7 
Inflation rate - based on the UK Retail Prices 
 Index (the RPI)                                                           3.1       3.3 
Inflation rate - based on the UK Consumer Prices 
 Index (the CPI)                                                           2.1       2.3 
Increase in salaries                                                       2.6       3.8 
Increase for pensions in payment - element 
 based on the RPI (where cap is 5%)                                        2.9       3.0 
Increase for pensions in payment - element 
 based on the CPI (where cap is 2.5%)                                      1.6       1.7 
Increase for pensions in payment - element 
 based on the CPI (where cap is 3%)                                        1.8       1.9 
Increase for pensions in deferment                                         2.1       2.3 
Inflation in medical costs                                                 6.1       6.3 
 
 

The mortality and other demographic assumptions used at 30 September 2019 remain unchanged from those used at 31 March 2019 and disclosed in the Group's statutory financial statements for the year then ended.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

17. Notes to the Group cash flow statement

 
(a) Cash generated from operations 
                                                                          Six months ended 30 September 
                                                                                   2019             2018 
                                                                                   US$m             US$m 
Profit before tax                                                                   480              470 
Share of post-tax profit of associates                                             (41)              (4) 
Net finance costs                                                                   117              114 
Operating profit                                                                    556              580 
Loss on disposal of fixed assets                                                      -                1 
Amortisation and depreciation(1)                                                    263              215 
Charge in respect of share incentive 
 plans                                                                               33               41 
Increase in working capital (note 
 17(b))                                                                           (317)            (188) 
Acquisition expenses - difference between 
 income statement charge and amount paid                                              -              (6) 
Adjustment to the fair value of contingent 
 consideration                                                                      (1)                3 
Movement in other non-benchmark items 
 included in working capital                                                         18              (8) 
Cash generated from operations                                                      552              638 
 
1. Amortisation and depreciation includes amortisation of acquisition 
 intangibles of US$59m (2018: US$56m) which is excluded from Benchmark 
 PBT. 
 
(b) Increase in working capital 
                                                                          Six months ended 30 September 
                                                                                   2019             2018 
                                                                                   US$m             US$m 
Trade and other receivables                                                        (13)               46 
Trade and other payables                                                          (304)            (234) 
Increase in working capital                                                       (317)            (188) 
 
(c) Purchase of other intangible 
 assets 
                                                                          Six months ended 30 September 
                                                                                   2019             2018 
                                                                                   US$m             US$m 
Databases                                                                            87               85 
Internally generated software                                                        86               58 
Internal use software                                                                18                8 
Purchase of other intangible assets                                                 191              151 
 
 

(d) Cash flows on acquisitions (non-GAAP measure)

 
                                                Six months ended 30 September 
                                                          2019            2018 
                                                          US$m            US$m 
Purchase of subsidiaries (note 23(a))                      350               - 
Less: net cash acquired with subsidiaries                 (12)               - 
Settlement of deferred and contingent 
 consideration                                              15               3 
As reported in the Group cash flow 
 statement                                                 353               3 
Acquisition expenses paid                                   16              12 
Transactions in respect of non-controlling 
 interests                                                  68             (2) 
Cash outflow for acquisitions (non-GAAP 
 measure) (Appendix 4)                                     437              13 
 
 
 
Notes to the condensed half-yearly financial statements 
 for the six months ended 30 September 2019 
 17. Notes to the Group cash flow statement (continued) 
 (e) Cash outflow in respect of net share purchases (non-GAAP measure) 
 
                                                        Notes    Six months ended 30 
                                                                      September 
                                                                       2019      2018 
                                                                       US$m      US$m 
-----------------------------------------------------  -------               -------- 
  Issue of ordinary shares                                21           (13)      (12) 
  Purchase of shares by employee trusts                   22             92         - 
 Purchase and cancellation of own shares                                 58       119 
                                                       ------- 
Cash outflow in respect of net share purchases 
 (non-GAAP measure)                                                     137       107 
                                                                             -------- 
 
 As reported in the Group cash flow statement: 
 Cash inflow in respect of shares issued                               (13)      (12) 
Cash outflow in respect of share purchases                              150       119 
                                                       ------- 
 Cash outflow in respect of net share 
  purchases (non-GAAP measure)                                          137       107 
-----------------------------------------------------  -------               -------- 
 

In the prior period cash outflow in respect of net share purchases included US$1m in respect of the settlement of shares purchased in the year ended 31 March 2018.

(f) Analysis of cash and cash equivalents

 
                                                      30 September 
                                                       2019    2018 
                                                       US$m    US$m 
 
 Cash and cash equivalents in the Group 
  balance sheet                                         146     175 
 Bank overdrafts                                        (3)     (3) 
 
Cash and cash equivalents in the Group cash flow 
 statement                                              143     172 
 

Cash and cash equivalents at 31 March 2019 of US$146m in the Group cash flow statement were reported net of overdrafts of US$3m.

18. Reconciliation of Cash generated from operations

to Benchmark operating cash flow (non-GAAP measure)

 
 
                                            Notes   Six months ended 30 
                                                         September 
                                                          2019      2018 
                                                          US$m      US$m 
Cash generated from operations              17(a)          552       638 
Purchase of other intangible assets         17(c)        (191)     (151) 
Purchase of property, plant and equipment                 (35)      (32) 
Sale of property, plant and equipment                        3         1 
Acquisition expenses paid                   17(d)           16        12 
Payment of lease liabilities                              (26)         - 
Cash flows in respect of Exceptional 
 and other non-benchmark items                              17         8 
Dividends received from associates                           4         2 
Benchmark operating cash flow (non-GAAP 
 measure)                                                  340       478 
 
 

Benchmark free cash flow for the six months ended 30 September 2019 was US$124m (2018: US$339m). Cash flow conversion for the six months ended 30 September 2019 was 51% (2018: 74%).

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

19. Net debt (non-GAAP measure)

 
(a) Analysis by nature 
                                                      30 September 
                                                        2019     2018 
                                                        US$m     US$m 
Cash and cash equivalents (net of overdrafts)            143      172 
Debt due within one year - commercial paper            (518)        - 
Debt due within one year - bonds and notes             (552)    (523) 
Debt due within one year - bank loans(1)                   -      (3) 
Debt due after more than one year - bonds and 
 notes                                               (2,082)  (2,227) 
Debt due after more than one year - bank loans(1)      (900)    (705) 
Derivatives hedging loans and borrowings               (151)    (217) 
                                                     (4,060)  (3,503) 
                                                    -------- 
 
   1.     Includes finance lease obligations in the prior period. 
 
(b) Analysis by balance sheet caption 
                                                            30 September 
                                                              2019     2018 
                                                              US$m     US$m 
                                                          -------- 
Cash and cash equivalents                                      146      175 
Current borrowings                                         (1,140)    (550) 
Non-current borrowings                                     (3,166)  (2,965) 
Borrowings                                                 (4,306)  (3,515) 
Total of Group balance sheet line items                    (4,160)  (3,340) 
Lease obligations reported within borrowings 
 excluded from Net debt from 1 April 2019                      222        - 
Accrued interest reported within borrowings above 
 but excluded from Net debt                                     29       54 
Derivatives reported within other financial assets              20       14 
Derivatives reported within other financial liabilities      (171)    (231) 
                                                           (4,060)  (3,503) 
                                                          -------- 
 

At 30 September 2019 the fair value of borrowings is US$4,358m (2018: US$3,494m) and includes lease liabilities of US$222m recognised in respect of right-of-use assets.

(c) Movements in Net debt

 
 
                      31 March             Movements in the period ended 30 September                    30 
                                                              2019                                September 
                          2019        Lease    Non-cash     Cash  Net share      Fair   Exchange       2019 
                                obligations       lease     flow  purchases     value  and other 
                                         on  obligation                        gains/  movements 
                                 transition   additions                      (losses) 
                          US$m          US$         US$     US$m       US$m      US$m       US$m       US$m 
                                             ----------  -------                       ---------  --------- 
Derivatives 
 hedging loans 
 and borrowings          (119)            -           -       14          -        11       (57)      (151) 
Borrowings(1)          (3,324)        (204)        (33)    (809)          -      (18)         82    (4,306) 
Total financing 
 liabilities           (3,443)        (204)        (33)    (795)          -       (7)         25    (4,457) 
Lease obligations(2)        13          204          33     (30)          -         -          2        222 
Accrued interest            19            -           -        -          -         -         10         29 
Cash and cash 
 equivalents               149            -           -      132      (137)         -          2        146 
Net debt               (3,262)            -           -    (693)      (137)       (7)         39    (4,060) 
                      -------- 
 
 

1. Cash flows include principal (US$26m) and interest (US$4m) payments in respect of lease obligations.

2. Following the implementation of IFRS 16, leases are excluded from our definition of Net debt and the opening position has been restated to exclude US$13m of finance lease liabilities previously reported at 31 March 2019.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

20. Undrawn committed bank borrowing facilities

 
                            30 September 
                          --------------- 
                            2019     2018 
                            US$m     US$m 
                          ------  ------- 
Facilities expiring in: 
Less than one year           225        - 
One to two years               -      635 
Two to three years             -    1,800 
Three to four years            -        - 
Four to five years         1,950        - 
                           2,175    2,435 
                                  ------- 
 

At 31 March 2019, there were undrawn committed borrowing facilities of US$2,625m.

There is one financial covenant in connection with the borrowing facilities. Benchmark EBIT must exceed three times net interest expense before financing fair value remeasurements. The calculation of the financial covenant excludes the effects of IFRS 16. The Group monitors this, and the Net debt to EBITDA leverage ratio, and has complied with this covenant throughout the period.

21. Called-up share capital and share premium account

 
                                        Number of     Called-up  Share premium 
                                           shares         share        account 
                                                        capital 
                                          million          US$m           US$m 
At 1 April 2018                             980.1            97          1,546 
Shares issued under employee share 
 incentive plans                              0.8             -             12 
Purchase and cancellation of own 
 shares                                     (4.9)             -              - 
                                                   ------------ 
At 30 September 2018                        976.0            97          1,558 
Shares issued under employee share 
 incentive plans                              0.1             -              1 
Purchase and cancellation of own 
 shares                                     (4.6)           (1)              - 
                                                   ------------ 
At 31 March 2019                            971.5            96          1,559 
Shares issued under employee share 
 incentive plans                              0.8             -             13 
Purchase and cancellation of own 
 shares                                     (2.0)             -              - 
                                                   ------------ 
At 30 September 2019                        970.3            96          1,572 
                                                   ------------ 
 
  22. Own shares held 
                                                      Number of        Cost of 
                                                         shares         shares 
                                                        million           US$m 
At 1 April 2018                                              74          1,227 
Other vesting of awards and exercises of share 
 options                                                    (4)           (56) 
At 30 September 2018                                         70          1,171 
Other vesting of awards and exercises of share 
 options                                                      -            (4) 
At 31 March 2019                                             70          1,167 
Purchase of shares by employee trusts                         3             92 
Other vesting of awards and exercises of share 
 options                                                    (5)           (70) 
At 30 September 2019                                         68          1,189 
 

Own shares held at 30 September 2019 include 60 million (2018: 61 million) shares held as treasury shares and 8 million (2018: 9 million) shares held in employee trusts. Own shares held at 31 March 2019 included 61 million shares held as treasury shares (1 April 2018: 62 million shares) and 9 million shares (1 April 2018: 12 million shares) held in employee trusts.

The total cost of own shares held at each balance sheet date is deducted from other reserves in the Group balance sheet.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

23. Acquisitions

(a) Acquisitions in the period

The Group made four acquisitions in the period to 30 September 2019, including the acquisition of the whole of the issued share capital of Compuscan (CSH Group (Pty) Limited) which completed on 30 April 2019. Compuscan is a leading provider of credit information and decision analytics in South Africa, with operations across seven key geographies in sub-Saharan Africa. Provisional goodwill of US$283m was recognised based on the fair value of net assets acquired of US$96m.

 
                                                    Compuscan  Other  Total 
                                                         US$m   US$m   US$m 
Intangible assets: 
Customer and other relationships                           53     29     82 
Software development                                       22     13     35 
Marketing-related acquisition intangibles                   -      1      1 
Other non-acquisition intangibles                           -      1      1 
Intangible assets                                          75     44    119 
Property, plant and equipment                               5      -      5 
Trade and other receivables                                 9      1     10 
Cash and cash equivalents (note 17(d))                     10      2     12 
Trade and other payables                                 (11)    (6)   (17) 
Current tax liabilities                                   (3)      -    (3) 
Deferred tax liabilities                                 (20)   (10)   (30) 
Total identifiable net assets                              65     31     96 
Goodwill                                                  203     80    283 
Total                                                     268    111    379 
Satisfied by: 
Cash (note 17(d))                                         268     82    350 
Contingent consideration                                    -     29     29 
Total                                                     268    111    379 
 

These provisional fair values contain amounts which will be finalised no later than one year after the date of acquisition. Provisional amounts have been included at 30 September 2019, as a consequence of the timing and complexity of the acquisitions. Goodwill represents the synergies, assembled workforces and future growth potential of the acquired businesses. None of the goodwill arising in the period of US$283m is currently deductible for tax purposes.

There have been no other material gains, losses, error corrections or other adjustments recognised in the period that relate to acquisitions in the current or prior periods.

(b) Additional information in respect of acquisitions in the period

 
                                                      Compuscan  Other  Total 
                                                           US$m   US$m   US$m 
Increase in book value from fair value adjustments: 
Intangible assets                                            75     43    118 
Trade and other payables                                    (3)      -    (3) 
Deferred tax liabilities                                   (20)   (10)   (30) 
Increase in book value from fair value adjustments           52     33     85 
Gross contractual amounts receivable in respect 
 of trade and other receivables                               7      1      8 
Pro forma revenue from 1 April 2019 to date 
 of acquisition                                               3      5      8 
Revenue from date of acquisition to 30 September 
 2019                                                        16      2     18 
Profit/(loss) before tax from date of acquisition 
 to 30 September 2019                                         2    (1)      1 
 

At the dates of acquisition, the gross contractual amounts receivable in respect of trade and other receivables of US$8m were expected to be collected in full. If the transactions had occurred on the first day of the financial year there would have been no impact on profit before tax.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

24. Financial risk management

(a) Financial risk factors

The Group's activities expose it to a variety of financial risks. These are market risk, including foreign exchange risk and interest rate risk, credit risk and liquidity risk. The nature of these risks and the policies adopted by way of mitigation are unchanged from those reported in the Annual Report and Group financial statements for the year ended 31 March 2019. Full information and disclosures were contained in that document.

(b) Analysis by valuation method for items measured at fair value

(i) As at 30 September 2019

 
                                      Level  Level 2  Level 3  Total 
                                          1 
                                       US$m     US$m     US$m   US$m 
 
Financial assets: 
Derivatives used for hedging              -       24        -     24 
Financial assets at fair value 
 through profit and loss                  -       57        -     57 
Amounts reported within other 
 financial assets                         -       81        -     81 
Financial assets revalued through 
 OCI                                     37        -      127    164 
                                         37       81      127    245 
 
Financial liabilities: 
Derivatives used for hedging              -    (158)        -  (158) 
Financial liabilities at fair 
 value through profit and loss            -     (50)     (60)  (110) 
                                          -    (208)     (60)  (268) 
Net financial assets/(liabilities)       37    (127)       67   (23) 
 
 

(ii) As at 30 September 2018

 
                                      Level  Level 2  Level 3  Total 
                                          1 
                                       US$m     US$m     US$m   US$m 
 
Financial assets: 
Derivatives used for hedging              -       19        -     19 
Financial assets at fair value 
 through profit and loss                  -       76        -     76 
Amounts reported within other 
 financial assets                         -       95        -     95 
Financial assets revalued through 
 OCI                                     37        -       57     94 
                                         37       95       57    189 
 
Financial liabilities: 
Derivatives used for hedging              -    (195)        -  (195) 
Financial liabilities at fair 
 value through profit and loss            -     (11)     (43)   (54) 
                                          -    (206)     (43)  (249) 
Net financial assets/(liabilities)       37    (111)       14   (60) 
 
 

In accounting for items measured at fair value, we follow EU-IFRS including IFRS 13 'Fair value measurement'. The fair values of derivative financial instruments and other financial assets and liabilities are determined by using market data and established estimation techniques such as discounted cash flow and option valuation models. The fair value of foreign exchange contracts is based on a comparison of the contractual and period end exchange rates. The fair values of other derivative financial instruments are estimated by discounting the future cash flows to net present values using appropriate market rates prevailing at the period end. There have been no changes in valuation techniques during the period under review.

The levels used in the above tables are defined in IFRS 13 and are summarised here for completeness:

-- assets and liabilities whose valuations are based on unadjusted quoted prices in active markets for identical assets and liabilities are classified as Level 1;

-- assets and liabilities which are not traded in an active market, and whose valuations are derived from available market data that is observable for the asset or liability, are classified as Level 2; and

-- assets and liabilities whose valuations are derived from inputs not based on observable market data are classified as Level 3.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

24. Financial risk management (continued)

(b) Analysis by valuation method for items measured at fair value (continued)

Level 3 items principally comprise minority shareholdings in unlisted businesses, trade investments, contingent consideration and put and call options associated with corporate transactions. The inputs used in determining valuations are a mix of earnings and asset valuations, reflecting different contractual arrangements. There would be no material effect on the amounts stated from any reasonably possible change in such inputs at 30 September 2019.

There have been no transfers between levels during the current or prior period.

(c) Analysis of movements in Level 3 net financial assets/(liabilities)

(i) Six months ended 30 September 2019

 
                                          Financial      Contingent  Other  Total 
                                             assets   consideration 
                                           revalued 
                                            through 
                                                OCI 
                                               US$m            US$m   US$m   US$m 
At 1 April 2019                                  67            (27)   (17)     23 
Additions(1)                                     62            (34)      -     28 
Adjustment to the fair value of 
 contingent consideration                         -               1      -      1 
Settlement of contingent consideration            -              15      -     15 
Other                                           (2)               1      1      - 
At 30 September 2019                            127            (44)   (16)     67 
 

1. Additions to contingent consideration comprise US$29m in respect of acquisitions and US$5m for transactions in respect of non-controlling interests.

(ii) Six months ended 30 September 2018

 
                                               Financial      Contingent  Other  Total 
                                         assets revalued   consideration 
                                                 through 
                                                     OCI 
                                                    US$m            US$m   US$m   US$m 
At 1 April 2018                                       46            (24)   (15)      7 
Additions                                             13               -      -     13 
Fair value losses recognised in 
 Group income statement (note 10(c))                   -               -    (3)    (3) 
Adjustment to the fair value of 
 contingent consideration                              -             (3)      -    (3) 
Other                                                (2)               1      1      - 
At 30 September 2018                                  57            (26)   (17)     14 
 

(d) Other financial assets and liabilities

Information in respect of the carrying amounts and the fair value of borrowings is included in note 19(b). There are no material differences between the carrying value of the Group's other financial assets and liabilities not measured at fair value and their estimated fair values. The following assumptions and methods are used to estimate the fair values of financial assets and liabilities not measured at fair value:

-- the fair values of receivables, payables and cash and cash equivalents are considered to approximate to the carrying amounts;

-- the fair values of short-term borrowings, other than bonds, are considered to approximate to the carrying amounts due to the short maturity terms of such instruments;

-- the fair value of that portion of bonds carried at amortised cost is based on quoted market prices, employing a valuation methodology falling within Level 1 of the IFRS 13 fair value hierarchy;

-- the fair values of long-term variable rate bank loans and lease obligations are considered to approximate to the carrying amount; and

-- the fair values of other financial assets and liabilities are calculated based on a discounted cash flow analysis, using a valuation methodology falling within Level 2 of the IFRS 13 fair value hierarchy.

(e) Carrying value of financial assets and liabilities

There have been no unusual changes in economic or business circumstances that have affected the carrying value of the Group's financial assets and liabilities at 30 September 2019.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

25. Related party transactions

The Group's related parties were disclosed in the Group's statutory financial statements for the year ended 31 March 2019 and there have been no material changes during the six months ended 30 September 2019. Following the divestment of CCM in the year ended 31 March 2018, the Group owns 24.47% of the issued share capital of Vector CM Holdings (Cayman), L.P. (Vector), a partnership incorporated in Cayman Islands.

In the six months ended 30 September 2019 the Group recorded the following transactions and balances with Vector and its subsidiaries:

 
                                      Transaction amount       Balance owed to 
                                                                      Experian 
                                       Six months ended 30     30 September 
                                                 September 
                                            2019      2018       2019     2018 
                                            US$m      US$m       US$m     US$m 
Promissory note and accrued 
 interest                                      3         2         90       82 
Transitional Services Arrangement 
 (TSA) fees                                    -         2          -        - 
Net amounts collected/(settled) 
 and (payable)/ receivable 
 under the TSA                               (1)        12          1        - 
 
 

The promissory note is due and payable to Experian on 31 May 2024 with interest also payable on this date. A 12-month TSA between the Group and Vector to provide services to the partnership has been extended. During the six months ended 30 September 2019, we continued to process transactions on behalf of Vector. We receive a pre-agreed fee for the execution of the TSA and do not receive any margin on individual transactions. Details of amounts arising from the TSA are shown in the table below.

 
                             Transaction amount      Balance owed to 
                                                              Vector 
                              Six months ended 30    30 September 
                                        September 
                                  2019       2018       2019    2018 
                                  US$m       US$m       US$m    US$m 
                                                   --------- 
Cash received on behalf 
 of Vector                           1         27          1       - 
                                                   --------- 
 
 
                                  Transaction amount       Balance owed to 
                                                                  Experian 
                                   Six months ended 30     30 September 
                                             September 
                                       2019       2018       2019     2018 
                                       US$m       US$m       US$m     US$m 
Cash paid on behalf of Vector             2         15          2        - 
 
 

Transactions with associates are made on normal market terms and in the period ended 30 September 2019 comprised the provision and receipt of services to other associates of US$1m (2018: US$4m) and US$3m (2018: US$2m) respectively. At 30 September 2019, amounts owed by associates, other than Vector, were US$nil (2018: US$1m) and amounts due to associates, other than Vector, totalled US$1m (2018: US$nil).

26. Contingencies

(a) North America security incident

In September 2015, Experian North America suffered an unauthorised intrusion to its Decision Analytics computing environment that allowed unauthorised acquisition of certain data belonging to a client, T-Mobile USA, Inc. We notified the individuals who may have been affected and offered free credit monitoring and identity theft resolution services. In addition, government agencies were notified as required by law. The costs of directly responding to this incident were reflected in a US$20m income statement charge in the year ended 31 March 2016.

We have received a number of class actions and other related claims in respect of the incident and are working with regulators and government bodies as part of their investigations. It is currently not possible to predict the scope and effect on the Group of these various regulatory and government investigations and legal actions, including their timing and scale. In the event of unfavourable outcomes, the Group may benefit from applicable insurance recoveries.

Notes to the condensed half-yearly financial statements

for the six months ended 30 September 2019

26. Contingencies (continued)

(b) Brazil tax

As previously indicated, Serasa S.A. has been advised that the Brazilian tax authorities are challenging the deduction for tax purposes of goodwill amortisation arising from its acquisition by Experian in 2007. To date the Brazilian courts have ultimately upheld Experian's position in respect of the tax years from 2007 to 2011, with no further right of appeal. The Brazilian tax authorities have raised similar assessments in respect of the 2012, 2013 and 2014 tax years, in which approximately US$95m of tax was claimed, and may raise similar claims in respect of other years. The possibility of this resulting in a liability to the Group is believed to be remote, on the basis of the advice of external legal counsel, success in cases to date and other factors in respect of the claim.

(c) UK marketing services regulation

Experian is in a process with the UK Information Commissioner's Office (ICO) with respect to a 2018 audit of several companies on the use of data for marketing purposes under the new EU General Data Protection Regulation (GDPR), which relates to our marketing services activities in the UK. We expect the outcome of this review to be released in the second half of the year ending 31 March 2020. At this stage we do not know what the final outcome will be, but it may require some changes to business processes in our UK marketing services business. This business represents approximately 1.6% of Experian's global revenues and we do not expect this to result in a materially adverse financial outcome for the Group.

(d) Other litigation and claims

There continue to be a number of pending and threatened litigation and other claims involving the Group across all its major geographies which are being vigorously defended. The directors do not believe that the outcome of any such claims will have a materially adverse effect on the Group's financial position. However, as is inherent in legal, regulatory and administrative proceedings, there is a risk of outcomes that may be unfavourable to the Group. In the case of unfavourable outcomes, the Group may benefit from applicable insurance recoveries.

27. Events occurring after the end of the reporting period

(a) First interim dividend

Details of the first interim dividend approved by the Board on 11 November 2019 are given in note 14.

(b) Acquisitions

On the 21 October 2019 the Group acquired a controlling interest in RAM Credit Information Sdn. Bhd. (RAMCI), a leading credit bureau in Malaysia.

On 8 November 2019 the Group announced that it had signed a definitive agreement to acquire 100% of the outstanding shares of Auto I.D., Inc. a leading provider of solutions and services to automotive lenders, for a cash consideration of US$180m, payable in full on closing. The provisional fair values of acquired assets and liabilities are currently being determined and will be disclosed in the Group's statutory financial statements for the year ending 31 March 2020.

28. Company website

The Company has a website which contains up-to-date information on Group activities and published financial results. The directors are responsible for the maintenance and integrity of statutory and audited information on this website. The work carried out by the auditor does not involve consideration of these matters. Jersey legislation and UK regulation governing the preparation and dissemination of financial information may differ from requirements in other jurisdictions.

Statement of directors' responsibilities

The directors are responsible for preparing the half-yearly financial report for the six months ended 30 September 2019 in accordance with applicable law, regulations and accounting standards.

The directors confirm that these condensed half-yearly financial statements have been prepared in accordance with IAS 34 'Interim financial reporting' as adopted by the EU, and that, to the best of their knowledge, the interim management report herein includes a fair review of the information required by:

(a) DTR 4.2.7R of the UK Financial Conduct Authority Disclosure Guidance and Transparency Rules Sourcebook, being an indication of important events that have occurred during the first six months of the financial year and the impact on these condensed half-yearly financial statements; and a description of the principal risks and uncertainties for the remaining six months of the financial year; and

(b) DTR 4.2.8R of the UK Financial Conduct Authority Disclosure Guidance and Transparency Rules Sourcebook, being related party transactions that have taken place in the first six months of the financial year and that have materially affected the financial position or performance of the enterprise during that period; and any changes in the related party transactions described in the last annual report that could do so.

The names and biographical details of the directors of Experian plc as at 14 May 2019 were listed in the Group's statutory financial statements for the year ended 31 March 2019. Don Robert retired as Chairman and as a director of Experian plc on 24 July 2019 in accordance with his previously announced intention, and Mike Rogers took up the role of Chairman on that date. Paul Walker retired from the Board on 24 July 2019 in accordance with his previously announced intention. A list of current directors is maintained on the Company website at www.experianplc.com.

By order of the Board

Charles Brown

Company Secretary

11 November 2019

Independent review report to Experian plc

Conclusion

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2019 of the Company and its subsidiaries (together the 'Group') which comprises the Group income statement, the Group statement of comprehensive income, the Group balance sheet, the Group statement of changes in total equity, the Group cash flow statement and the related explanatory notes.

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2019 is not prepared, in all material respects, in accordance with IAS 34 'Interim financial reporting' as adopted by the EU and the Disclosure Guidance and Transparency Rules Sourcebook (the DTR) of the UK's Financial Conduct Authority (the UK FCA).

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. We read the other information contained in the half-yearly financial report and consider whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FCA.

As disclosed in note 2, the annual financial statements of the Group are prepared in accordance with International Financial Reporting Standards as adopted by the EU. The directors are responsible for preparing the condensed set of financial statements included in the half-yearly financial report in accordance with IAS 34 as adopted by the EU.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

The purpose of our review work and to whom we owe our responsibilities

This report is made solely to the Company in accordance with the terms of our engagement to assist the Company in meeting the requirements of the DTR of the UK FCA. Our review has been undertaken so that we might state to the Company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our review work, for this report, or for the conclusions we have reached.

Andrew Bradshaw

for and on behalf of KPMG LLP

Chartered Accountants

15 Canada Square

London

E14 5GL

United Kingdom

11 November 2019

Shareholder information

Company website

A full range of investor information is available at www.experianplc.com.

Electronic shareholder communication

Shareholders may register for Share Portal, an electronic communication service provided by Link Market Services (Jersey) Limited, via the Company website at shares.experianplc.com. The service is free and it facilitates the use of a comprehensive range of shareholder services online.

When registering for Share Portal, shareholders can select their preferred communication method - email or post. Shareholders will receive a written notification of the availability on the Company's website of shareholder documents unless they have elected to either (i) receive such notification via email or (ii) receive paper copies of shareholder documents where such documents are available in that format.

Dividend information

Dividends for the year ending 31 March 2020

A first interim dividend in respect of the year ending 31 March 2020 of 14.50 US cents per ordinary share will be paid on 31 January 2020 to shareholders on the register at the close of business on 3 January 2020. Unless shareholders elect by 3 January 2020 to receive US dollars, their dividends will be paid in pounds sterling at a rate per share calculated on the basis of the exchange rate from US dollars to pounds sterling on 10 January 2020.

Income access share (IAS) arrangements

As its ordinary shares are listed on the London Stock Exchange, the Company has a large number of UK resident shareholders. In order that shareholders may receive Experian dividends from a UK source, should they wish, the IAS arrangements have been put in place. The purpose of the IAS arrangements is to preserve the tax treatment of dividends paid to Experian shareholders in the UK, in respect of dividends paid by the Company. Shareholders who elect, or are deemed to elect, to receive their dividends via the IAS arrangements will receive their dividends from a UK source (rather than directly from the Company) for UK tax purposes.

Shareholders who hold 50,000 or fewer Experian shares on the first dividend record date after they become shareholders, unless they elect otherwise, will be deemed to have elected to receive their dividends under the IAS arrangements.

Shareholders who hold more than 50,000 shares and who wish to receive their dividends from a UK source must make an election to receive dividends via the IAS arrangements. All elections remain in force indefinitely unless revoked.

Unless shareholders have made an election to receive dividends via the IAS arrangements, or are deemed to have made such an election, dividends will be received from an Irish source and will be taxed accordingly.

Dividend Reinvestment Plan (DRIP)

The DRIP enables those shareholders who receive their dividends under the IAS arrangements to use their cash dividends to buy more shares in the Company. Eligible shareholders, who wish to participate in the DRIP in respect of the first interim dividend for the year ending 31 March 2020 to be paid on 31 January 2020, should return a completed and signed DRIP application form, to be received by the registrars by no later than 3 January 2020. Shareholders should contact the registrars for further details.

American Depositary Receipts (ADR)

Experian has a sponsored Level 1 ADR programme, for which Bank of New York Mellon acts as depositary. This programme is not listed on a stock exchange in the US and trades in the over-the-counter market on the OTCQX platform under the symbol EXPGY. Each ADR represents one Experian plc ordinary share. Further information can be obtained by contacting:

 
BNY Mellon Shareowner Services 
PO Box 505000 
 Louisville, KY 40233-5000 
USA 
 
T +1 201 680 6825 (from the US: 1-888-BNY-ADRS) 
 E shrrelations@cpushareownerservices.com 
 W www.mybnymdr.com 
 
 
  Shareholder information (continued) 
 
  Financial calendar 
First interim ex-dividend date         2 January 2020 
First interim dividend record          3 January 2020 
 date 
First interim dividend exchange        10 January 2020 
 rate determined 
Trading update, third quarter          17 January 2020 
First interim dividend payment         31 January 2020 
 date 
Preliminary announcement of full       20 May 2020 
 year results 
Trading update, first quarter          16 July 2020 
Annual General Meeting                 22 July 2020 
 

Contact information

 
Corporate headquarters 
Experian plc 
 Newenham House 
Northern Cross 
Malahide Road 
Dublin 17 
 D17 AY61 
Ireland 
T +353 (0) 1 846 9100 
F +353 (0) 1 846 9150 
 
Investor relations 
E investors@experian.com 
 
Registered office 
Experian plc 
 22 Grenville Street 
St Helier 
Jersey 
JE4 8PX 
 Channel Islands 
 
Registered number - 93905 
 
 
Registrars 
Experian Shareholder Services 
Link Market Services (Jersey) Limited 
PO Box 532 
St Helier 
Jersey 
JE4 5UW 
 Channel Islands 
 
Shareholder helpline 0371 664 9245 (+44 800 141 2952 for calls 
 from outside the UK) 
E experian@linkregistrars.com 
 
Calls are charged at the standard geographic rate and will vary 
 by provider. Calls from outside the United Kingdom will be charged 
 at the applicable international rate. Lines are open between 8.30am 
 and 5.30pm (UK time), Monday to Friday excluding public holidays 
 in England and Wales. 
 

Stock exchange listing information

Exchange: London Stock Exchange, Premium Main Market

Index: FTSE 100

Symbol: EXPN

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

IR GMMMMLMFGLZM

(END) Dow Jones Newswires

November 12, 2019 02:00 ET (07:00 GMT)

1 Year Experian Chart

1 Year Experian Chart

1 Month Experian Chart

1 Month Experian Chart

Your Recent History

Delayed Upgrade Clock