Despite the difficult economic environment, Interactive Data Corporation’s Pricing and Reference Data has experienced revenue growth of 4.6% in the second quarter of this year compared to last year’s figures. This is in contrast to a decrease for the vendor’s overall financial results for the second quarter ended 30 June 2009, US$185.0 million compared with US$186.1 million in the second quarter of 2008, representing a decrease of 0.59%.
The vendor’s Pricing and Reference Data has reported a second quarter 2009 revenue of US$123.2 million, an increase of US$5.4 million, or 4.6%, over the prior year’s second quarter (or an increase of US$12.3 million, or 10.5%, before the effects of foreign exchange). Ray D’Arcy, Interactive Data’s president and CEO, says that the reference data part of its business has offset some of the fallout from the “challenging market conditions” experienced this year.
The reference data division has been buoyed with key acquisitions such as Kler’s Financial Data Service in August 2008 and NTT Data Financial (NDF) later in the year. Kler’s contributed revenue of US$2.6 million in the second quarter of 2009. NDF, in which the vendor acquired a majority interest in December 2008 and subsequently acquired an additional 10% interest during the second quarter of 2009, contributed an incremental US$2.2 million to second quarter 2009 revenue.
Excluding the contributions from Kler’s and NDF, related intercompany eliminations associated with NDF and the effects of foreign exchange, second quarter 2009 organic revenue for this business increased by US$7.5 million, or 6.4%, over the same period last year. The vendor attributes this primarily to the expansion of its business with existing customers in both North America and Europe. During the second quarter, the Pricing and Reference Data business introduced the Options Volatility Service, and broadened its Evaluated Services capabilities with new informational resources, transparency tools and expanded coverage of mortgage backed securities.
“We made progress during the quarter to drive increased adoption of our core institutional services, which reflects positively on the strength of our fixed income evaluations and reference data services, as well as our ability to respond with new services that address key customer needs around the world,” says D’Arcy.
Overall, Interactive Data’s second quarter 2009 revenue was US$185.0 million, compared with US$186.1 million in the second quarter of 2008. Income from operations in the second quarter of 2009 was US$50.6 million, compared with US$50.0 million in the same period one year ago. Net income attributable to Interactive Data for the second quarter of 2009 was US$33.1 million, or US$0.34 per diluted share, compared with net income of US$33.5 million, or US$0.35 per diluted share, in the second quarter of 2008.
The contrast between the vendor’s overall performance and its reference data division could be reflective of the current trend within the market to focus on targeted risk mitigation and infrastructure projects. Areas such as corporate actions and derivatives data have seen an uptick in spending despite the difficult economic conditions. Many firms are keen to steal a march on the regulatory community and upgrade their core systems and data in order to avoid a reoccurrence of the fallout seen post-Lehman.