D&B Announces Acquisition of Dun & Bradstreet Australia Holdings Limited for $205 million; Reconfirms 2010 Guidance
SHORT HILLS, N.J., Aug 31, 2010 (BUSINESS WIRE) -- D&B (NYSE: DNB), the world's leading source of commercial information
and insight on businesses, today announced it has acquired a member of
the D&B Worldwide Network, privately held Dun & Bradstreet Australia
Holdings Limited ("D&B Australia"), the leading credit and information
services provider in Australia and New Zealand, for approximately $205
million in cash. The transaction closed today and was financed primarily
with existing cash on hand.
"The acquisition of D&B Australia represents a strong fit with our
international strategy and allows D&B to participate directly in a
geographic region that has increasing importance for our global
customers. D&B Australia has tripled in size over the last decade and we
expect continued growth in the years ahead," stated Sara Mathew, D&B's
Chairman and Chief Executive Officer.
D&B Australia is a trusted leader in commercial risk and receivables
management and owns and operates an emerging high growth consumer credit
service. Through these three primary units, D&B Australia is able to
efficiently collect high quality data on most businesses within
Australia and New Zealand.
For its fiscal year ended June 30, 2010, D&B Australia generated
approximately $80 million of revenue and operating margins of
approximately 20%, in accordance with International Financial Reporting
For the remainder of 2010, we expect the acquisition of D&B Australia to
impact our full-year 2010 financial results, as follows:
Provide incremental revenue of approximately $15 to $20 million;
Dilute EPS by approximately $0.04 to $0.05, largely driven by non-cash
charges for incremental amortization from the establishment of
intangible assets, as well as one-time transaction related expenses.
Excluding this acquisition, our expectations for our core business are
unchanged from our previously communicated 2010 guidance. International
is expected to deliver double digit revenue growth and we expect to see
sequential revenue growth in North America over the remainder of the
As a result, while the acquisition provides modest upside to revenue and
dilution to earnings, we remain comfortable with our current guidance
Core revenue growth of 1% to 3%, before the effect of foreign exchange;
Operating income down 2% to up 2%, before non-core gains and charges;
Diluted EPS growth of 1% to 6%, before non-core gains and charges; and
Free cash flow of $240 million to $270 million, excluding the impact
of legacy tax matters, but including our Strategic Technology
As a reminder, D&B does not provide guidance on a GAAP basis because D&B
is unable to predict, with reasonable certainty, the future movement of
foreign exchange rates or the future impact of non-core gains and
charges, such as restructuring charges and legacy tax matters, which are
a component of the most comparable financial measures calculated in
accordance with GAAP. Non-core gains and charges are uncertain and will
depend on several factors, including industry conditions, and could be
material to D&B's results computed in accordance with GAAP.
Use of Non-GAAP Financial Measures
D&B reports non-GAAP financial measures in this press release. See "Item
7. Management's Discussion and Analysis of Financial Condition and
Results of Operations - How We Manage Our Business" in the D&B Annual
Report on Form 10-K for the year ending December 31, 2009, filed
February 25, 2010 with the SEC, for a discussion of how D&B defines
these measures, why it uses them and why it believes they provide useful
information to investors.
About Dun & Bradstreet(R) (D&B)
Dun & Bradstreet (NYSE:DNB) is the world's leading source of commercial
information and insight on businesses, enabling companies to Decide with
Confidence(R) for 169 years. D&B's global commercial database
contains more than 168 million business records. The database is
enhanced by D&B's proprietary DUNSRight(R) Quality Process,
which provides our customers with quality business information. This
quality information is the foundation of our global solutions that
customers rely on to make critical business decisions.
D&B provides solution sets that meet a diverse set of customer needs
globally. Customers use D&B Risk Management SolutionsTM
to mitigate credit and supplier risk, increase cash flow and drive
increased profitability; D&B Sales & Marketing SolutionsTM
to increase revenue from new and existing customers; and D&B Internet
SolutionsTM to convert prospects into clients faster by
enabling business professionals to research companies, executives and
industries, over the web. For more information, please visit www.dnb.com.
Forward-Looking and Cautionary Statements
This press release, contains projections of future results and other
forward-looking statements that involve a number of trends, risks and
uncertainties, and are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995.
The following important factors could cause actual results to differ
materially from those projected in such forward-looking statements.
D&B relies significantly on third parties to support critical
components of its business model in a continuous and high-quality
manner, including third-party data providers, strategic third party
members in its Worldwide Network, and third parties with which it has
D&B's ability to implement and derive the benefits of its strategic
technology investment program announced in February 2010.
Demand for D&B's products is subject to intense competition, changes
in customer preferences and economic conditions which impact customer
D&B's solutions and brand image are dependent upon the integrity and
security of its global database and the continued availability thereof
through the Internet and by other means, as well as our ability to
protect key assets, such as our data centers.
D&B's ability to maintain the integrity of its brand and reputation,
which it believes are key assets and competitive advantages.
D&B's ability to renew large contracts, the related revenue
recognition and the timing thereof, or a shift in product mix, may
impact its results of operations from period to period.
As a result of the macro-economic challenges currently affecting the
global economy, D&B's customers or vendors may experience cash flow
problems. This may cause its customers to delay, cancel or
significantly decrease their purchases from D&B and impact their
ability to pay amounts owed to D&B. In addition, D&B's vendors may
substantially increase their prices without notice. Such behavior may
adversely affect D&B's earnings and cash flow. In addition, if
economic conditions in the United States and other key markets
deteriorate further or do not show improvement, D&B may experience
material adverse impacts to its business, operating results, or access
to credit markets.
D&B's results are subject to the effects of foreign economies,
exchange rate fluctuations, legislative or regulatory requirements,
such as the adoption of new or changes in accounting policies and
practices, including pronouncements by the Financial Accounting
Standards Board or other standard-setting bodies, and the
implementation or modification of fees or taxes that it must pay to
acquire, use, and/or redistribute data.
D&B's ability to introduce new solutions or services, including in a
seamless way and without disruption to existing solutions, such as
D&B's ability to acquire and successfully integrate other
complementary businesses, products and technologies into its existing
business, without significant disruption to its existing business or
to its financial results.
The continued adherence by third party members of the D&B Worldwide
Network to D&B's quality standards, its brand and communication
standards and to the terms and conditions of its commercial services
D&B's future success requires that it attract and retain qualified
personnel, including members of its sales force and technology teams,
in regions throughout the world.
The profitability of D&B's International segment depends on its
ability to identify and execute on various initiatives, such as the
continued implementation of subscription plan pricing and successfully
managing its D&B Worldwide Network, and its ability to identify and
contend with various challenges present in foreign markets, such as
local competition and the availability of public records at no cost.
D&B's ability to successfully implement its growth strategy requires
that it successfully reduce its expense base through its Financial
Flexibility initiatives, and reallocate certain of the expense-base
reductions into initiatives that produce desired revenue growth.
D&B is involved in various tax matters and legal proceedings, the
outcomes of which are unknown and uncertain with respect to the impact
on D&B's cash flow and profitability. See the Company's most recent
Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and
notes to the financial statements included therewith, for a more
detailed description of these matters.
D&B's ability to repurchase shares is subject to market conditions,
including trading volume in its stock, and its ability to repurchase
shares in accordance with applicable securities laws.
D&B's projection for free cash flow is dependent upon its ability to
generate revenue, its collection processes, customer payment patterns,
the timing and volume of stock option exercises and the amount and
timing of payments related to the tax and other matters and legal
proceedings in which it is involved, as referenced above and as more
fully described in the Company's filings with the SEC, including its
most recent Annual Report on Form 10-K and Quarterly Reports on Form
10-Q and notes to the financial statements included therewith.
For a more detailed discussion of the trends, risks and uncertainties
that may affect D&B's operating and financial results and its ability to
achieve the financial objectives discussed in this press release,
readers should review the Company's most recent filings with the SEC,
including the Annual Report on Form 10-K and Quarterly Reports on Form
10-Q. Copies of the Company's Annual Report on Form 10-K and Quarterly
Reports on Form 10-Q are available on its Web site at www.dnb.com
and on the SEC's Web site at www.sec.gov.
D&B cautions that the foregoing list of important factors is not
complete and except as otherwise required by federal securities laws
does not undertake any obligation to update any forward-looking
Ana Cano, 212-367-6920 (Media)
Kathy Guinnessey, 973-921-5892 (Investors/Analysts)
Copyright Business Wire 2010
Close window | Back to top