FactSet, a global provider of integrated financial information, analytical applications, and industry-leading service, announced results for its first quarter ended November 30, 2019.
First Quarter Fiscal 2020 Highlights
- Revenues increased 4.3% or $15.0 million to $366.7 million compared with $351.6 million for the same period in fiscal 2019. The increase is primarily due to higher sales of analytics, content and technology solutions (CTS) and wealth management solutions. Organic revenues grew 4.2% to $367.9 million during the first quarter of fiscal 2020 from the prior year period.
- Annual Subscription Value (ASV) plus professional services was $1.48 billion at November 30, 2019 compared with prior year of $1.48 billion. The organic growth rate, which excludes the effects of acquisitions, dispositions, and foreign currency, was 4.1%. Growth in Wealth, CTS and Analytics was offset by higher cancellations impacting the Research workflow. Please see the “ASV + Professional Services” section of this press release for details.
- Operating margin increased to 30.9% compared with 28.6% for the same period last year. Adjusted operating margin improved to 33.9% compared with 31.5% in the prior year period primarily as a result of improved operating results.
- Diluted earnings per share (EPS) increased 12.0% to $2.43 compared with $2.17 for the same period in fiscal 2019. Adjusted diluted EPS rose 9.8% to $2.58 compared with $2.35 in the prior period driven primarily by stronger operating results.
- The Company’s effective tax rate for the first quarter increased to 13.6% compared with 12.1% a year ago primarily due to higher one-time tax benefits in the first quarter of 2019.
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“FactSet started its fiscal 2020 with encouraging progress on our three-year investment plan,” said Phil Snow, FactSet CEO. “While we were impacted in Q1 by increased industry pressure, I am pleased with our outlook as we head into Q2. We expect that the steps we are taking to accelerate our content and technology development will help us drive future growth as we continue our consistent record of delivering value to clients, employees, and stakeholders.”
As expected, our continued focus on fiscal discipline and operational improvement resulted in strong earnings growth this quarter,” said Helen Shan, FactSet CFO. “Our three-year investment plan includes targeted actions to fuel top line growth across all our businesses. We remain sound and consistent stewards of capital, returning a high level of value to shareholders.”
Annual Subscription Value (ASV) + Professional Services and Segment Revenue
ASV at any given point in time represents the forward-looking revenues for the next twelve months from all subscription services currently supplied to clients and excludes professional services fees billed in the last 12 months, which are not subscription-based. Professional services are revenues derived from project-based consulting and implementation.
ASV plus professional services was $1.48 billion at November 30, 2019. Organic ASV plus professional services was also $1.48 billion at November 30, 2019, up $57.8 million from the prior year at a growth rate of 4.1%. Organic ASV, which excludes the effects of acquisitions, dispositions and foreign currency, plus professional services, decreased $2.9 million over the last three months.
Buy-side and sell-side ASV growth rates for the first quarter of fiscal 2020 were 4.0% and 4.0%, respectively. Buy-side clients accounted for 83.9% of organic ASV while the remainder is derived from sell-side firms that perform mergers and acquisitions advisory work, capital markets services and equity research. Supplementary tables covering organic buy-side and sell-side ASV growth rates may be found on the last page of this earnings release.