D&B's Blueprint Strategy Delivers Strong Results in 2004 First Quarter.Business Editors SHORT HILLS, N.J.--(BUSINESS WIRE)--April 21, 2004 D&B (NYSE NYSE See: New York Stock Exchange : DNB DNB Dictionary of National Biography DNB Drum N Bass (music) DNB De Nederlandsche Bank DNB Dun & Bradstreet (stock symbol) DNB Den Norske Bank DNB David Nelson Band ) -- EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. of $0.66 up 38 Percent on a GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). Basis; Up 18 Percent to $0.60 Before Non-Core Gains and Charges -- Total Revenue up 9 Percent on a GAAP Basis; Core Revenue up 9 Percent including 6 points of Organic Growth, both Before Foreign Exchange -- Outlines Plans to Create $80 million of Annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. Financial Flexibility -- Raises 2004 Revenue Guidance; Confirms Previous EPS Guidance D&B (NYSE: DNB), the leading provider of global business information and technology solutions, today reported results for the first quarter ended March 31, 2004. "We are very pleased with our performance in the first quarter. We are off to a strong start relative to our expectations for 2004. We achieved 6 percent organic revenue growth for the second consecutive quarter, due to strong leadership by our team members worldwide and increased customer acceptance of the power of DUNSRight(TM)," said Allan Allan can refer to:
p. p. 1. strong p. p. os> of Lose. Noun 1. Loren - Italian film actress (born in 1934) Sofia Scicolone, Sophia Loren , chairman and chief executive officer of D&B. "Additionally, our flexible business model enabled us to invest for growth while delivering strong EPS growth of 18 percent before non-core gains and charges and free cash flow growth of 21 percent." First Quarter 2004 Results The Company reported diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for the quarter ended March 31, 2004 of 60 cents, up 18 percent from 51 cents in the prior year quarter before non-core gains and charges in both periods. Core revenue for the quarter was $342.3 million, a 14 percent increase compared with the prior year quarter. Core revenue was up 9 percent before the effect of foreign exchange with 6 percentage points of the increase due to organic growth and 3 percentage points of the increase due to the Company's recent acquisitions. The core revenue results reflected the following by product line: -- Risk Management Solutions revenue of $236.6 million, up 11 percent (up 6 percent before the effect of foreign exchange); -- Sales & Marketing Solutions revenue of $86.9 million, up 10 percent (up 8 percent before the effect of foreign exchange); -- Supply Management Solutions revenue of $7.7 million, up 4 percent (flat before the effect of foreign exchange); and -- E-Business (Electronic-BUSINESS) Doing business online. The term is often used synonymously with e-commerce, but e-business is more of an umbrella term for having a presence on the Web. Solutions revenue of $11.1 million represented the results of Hoover's Hoover's, Inc. is a business research company that has provided information on U.S. and foreign companies and industries since 1990. Since 1993, the company has made its information available on its website www.hoovers.com. , Inc. which was acquired in March 2003 and contributed 3 percentage points of the Company's overall core revenue growth. Total revenue for the quarter, which included the results of divested businesses, was $343.4 million, a 9 percent increase over total revenue in the year ago quarter (up 5 percent before the effect of foreign exchange). Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the first quarter was $75.7 million, up 14 percent from the year ago period before non-core charges in both years. The increase was primarily due to the higher revenue. On a GAAP basis, operating income was $65.5 million, up 18 percent compared with $55.6 million in the same period last year. GAAP results included $10.2 million of non-core charges in 2004 and $10.9 million of non-core charges in 2003 related to the Company's financial flexibility initiatives in each period. Net income for the quarter was $45.1 million, up 14 percent from $39.4 million in the prior-year period, before non-core gains and charges in both years. On a GAAP basis, net income was $49.8 million, up 34 percent compared with $37.1 million in the first quarter of 2003. During the first quarter, free cash flow was $66.3 million, up 21 percent compared with the first quarter 2003. Free cash flow consisted of net cash provided by operating activities of $71.2 million less a total of $4.9 million for capital expenditures, additions to computer software and other intangibles Property that is a "right" such as a patent, Copyright, or trademark, or one that is lacking physical existence, such as good will. . The Company repurchased $62 million of its common stock during the quarter under its $200 million share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. program announced in February February: see month. 2004. D&B continued to make progress in migrating its product delivery to the Web. At the end of March, D&B delivered 77 percent of its revenue over the Web, up from 76 percent at the end of 2003. First Quarter 2004 Segment Results North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. North America's first quarter total and core revenue was $250.5 million, up 11 percent from $226.5 million in the prior year quarter, (including 0.4 percent from the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. effect of foreign exchange related to the Company's Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. operations), with 7 percentage points of the increase due to organic growth and 3 percentage points of the increase due to the Company's acquisition of Hoover's. North America's revenue results included: -- $161.3 million from Risk Management Solutions, up 6 percent; -- $72.6 million from Sales & Marketing Solutions, up 9 percent; -- $5.5 million from Supply Management Solutions, up 1 percent; and -- $11.1 million from E-Business Solutions, which represented the results of Hoover's, Inc. North America's operating income for the quarter was $87.5 million, up 9 percent from $80.3 million in the prior year quarter. The increase was primarily due to higher revenue, and included investments to drive growth in 2004. International The International segment's first-quarter core revenue was $91.8 million, up 23 percent from $74.8 million in the prior year quarter. Revenue was up 7 percent before the effect of foreign exchange, with 4 percentage points of the increase due to organic growth and 3 percentage points of the increase due to the Company's acquisition of three Italian real estate information companies in April 2003. These International revenue results included: -- $75.3 million from Risk Management Solutions, up 24 percent (up 8 percent before the effect of foreign exchange); -- $14.3 million from Sales & Marketing Solutions, up 20 percent (up 5 percent before the effect of foreign exchange); and -- $2.2 million from Supply Management Solutions, up 10 percent (down 3 percent before the effect of foreign exchange). Total revenue for the quarter was $92.9 million, a 5 percent increase over total revenue in the year ago quarter (down 8 percent before the effect of foreign exchange). The International segment's operating income for the quarter was $7.1 million compared with operating income of $1.3 million in the prior year quarter. This improvement in profitability was primarily due to increased revenue and a lower expense base associated with the Company's financial flexibility program. Financial Flexibility Initiatives Since launching its Blueprint blueprint, white-on-blue photographic print, commonly of a working drawing used during building or manufacturing. The plan is first drawn to scale on a special paper or tracing cloth through which light can penetrate. for Growth strategy in October October: see month. 2000, D&B has leveraged financial flexibility to fund investment for growth and to create shareholder value. D&B today outlined its financial flexibility plans for 2004, first announced in February 2004. On an annualized basis, these initiatives are expected to create approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $80 million of funds, of which approximately $50 million will be generated in 2004. The Company expects to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. transition costs of approximately $22 million in 2004 to implement this series of actions. With the plans announced today, approximately 1,000 positions worldwide are expected to be eliminated by the end of 2004. As a result, the Company expects to incur non-core charges throughout 2004 totaling approximately $30 to $35 million pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta , primarily for severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and termination The point where a line, channel or circuit ends. See SCSI termination and hybrid. costs associated with this series of initiatives. "When we launched our Blueprint over 3 1/2 years ago, we said that creating financial flexibility would be a key component of our strategy, because it would enable us to invest in the growth of our business and create shareholder value," said Loren. "We said we would continuously identify opportunities to improve the performance of our business and generate savings to invest in growth - and we have done that. This latest series of initiatives is one more example of how our financially flexible business model enables us to generate additional savings to invest for growth, year after year." The Company's re-engineering re-engineering - The examination and modification of a system to reconstitute it in a new form and the subsequent implementation of the new form. http://erg.abdn.ac.uk/users/brant/sre. initiatives are focused on the following: -- Making data acquisition and delivery more efficient by streamlining, automating and consolidating data collection processes; -- Consolidating and standardizing technology infrastructure, development and maintenance, as well as integrating the Web across all product solutions; -- Redesigning and automating principal financial processes and systems as well as consolidating purchasing spend worldwide; -- Evaluating opportunities to consolidate Consolidate To combine the assets, liabilities, and other financial items of two or more entities into one. Notes: This term is generally used in the context of consolidated financial statements. and streamline streamline, path of a fluid flowing steadily and without appreciable turbulence. A body is said to be streamlined if its shape offers the least possible resistance to a current of air, water, or other fluid. functions in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). to increase the focus on the markets wherethe Company is investing to strengthen its leadership position and to better reflect the size of its European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. operations. To implement its plans, the Company follows a structured process to create financial flexibility. Specifically, the Company will eliminate, consolidate, standardize stan·dard·ize v. 1. To cause to conform to a standard. 2. To evaluate by comparing with a standard. , automate To turn a set of manual steps into an operation that goes by itself. See automation. and outsource outsource verb To assign specific work to a 3rd party for a specific length of time at an set price and service level Managed care To use outside labor to perform functions–billing and collections, accounting, janitorial services, ER processes and functions to make them more efficient and improve quality. Non-Core Gains and Charges The Company recorded a pre-tax, non-core charge of $10.2 million related to its financial flexibility initiatives in the first quarter of 2004. The charge was recorded within operating income as Corporate and other expense. In addition, during the first quarter of 2004 the Company recorded, within Non-Operating Income (Expense)-Net, pre-tax, non-core gains of $11.7 million related to the sale of its Nordic (Sweden Sweden, Swed. Sverige, officially Kingdom of Sweden, constitutional monarchy (2005 est. pop. 9,002,000), 173,648 sq mi (449,750 sq km), N Europe, occupying the eastern part of the Scandinavian peninsula. , Denmark Denmark (dĕn`märk), Dan. Danmark, officially Kingdom of Denmark, kingdom (2005 est. pop. 5,432,000), 16,629 sq mi (43,069 sq km), N Europe. , Norway Norway, Nor. Norge, officially Kingdom of Norway, constitutional monarchy (2005 est. pop. 4,593,000), 125,181 sq mi (324,219 sq km), N Europe, occupying the western part of the Scandinavian peninsula. and Finland Finland, Finnish Suomi (swô`mē), officially Republic of Finland, republic (2005 est. pop. 5,223,000), 130,119 sq mi (337,009 sq km), N Europe. ) and India India, officially Republic of India, republic (2005 est pop. 1,080,264,000), 1,261,810 sq mi (3,268,090 sq km), S Asia. The second most populous country in the world, it is also sometimes called Bharat, its ancient name. India's land frontier (c. Operations, and distribution channels in Pakistan Pakistan (păk`ĭstăn', päkĭstän`), officially Islamic Republic of Pakistan, republic (2005 est. pop. 162,420,000), 310,403 sq mi (803,944 sq km), S Asia. and the Middle East. In 2003, the Company recorded a pre-tax, non-core charge of $10.9 million in the first quarter related to the fourth phase of financial flexibility. The charge was recorded within operating income as Corporate and other expense. In addition, during the first quarter of 2003 the Company recorded, within Non-Operating Income (Expense)-Net, a $7.0 million pre-tax, non-core gain related to an insurance recovery. D&B's restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. may be viewed as recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. as they are part of each phase of its financial flexibility initiatives. In addition to reporting GAAP results, the Company reports results before restructuring charges and other non-core gains and charges because they are not a component of its ongoing income or expense and may have a disproportional dis·pro·por·tion·al adj. Disproportionate. dis  pro·por positive or negative impact on the results of its
ongoing underlying business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets . See "Use of Non-GAAP
Financial Measures" below.Full Year Outlook The Company confirmed its previous full-year diluted earnings per share guidance of between $2.81 and $2.92 on a GAAP basis. This guidance includes non-core gains of 19 cents to 20 cents during 2004 related to the sale of businesses in the International segment and non-core charges of 27 cents to 32 cents during 2004 related to its current phase of financial flexibility. D&B also confirmed its previous expectation for 2004 diluted earnings per share before non-core gains and charges of between $2.94 and $2.99, representing between 16 and 18 percent growth, compared to $2.54 of diluted earnings per share before net non-core charges of 24 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. in 2003. This guidance includes the effect of the share repurchase program announced in February 2004. The Company increased its guidance for core revenue growth to a range of 5 to 6 percent before the effect of foreign exchange. This compares with its previously announced range of 3 to 5 percent. Because D&B is unable to predict the future movements of foreign exchange rates the Company is unable to provide an outlook for 2004 revenue on a GAAP basis. "Over the past 3 1/2 years, we have clearly transformed D&B from an underperforming business to a good company," said Loren. "This is now our second consecutive quarter of strong growth. This trend, and our planned investments for the balance of the year, give us confidence that we can raise our revenue expectations, and, continue to provide value for our shareholders." "Our model is simple," Loren continued. "Financial flexibility provides funds to invest for growth, which enables us to transform the Company while creating shareholder value." The Company also confirmed its previous guidance for 2004 free cash flow of $230 to $245 million. This expected range is before any potential payments in settlement of tax or legal matters described in D&B's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended December December: see month. 31, 2003. Investor Meeting Scheduled The Company also announced today that it will host an Investor Meeting in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. on Tuesday Tuesday: see week. , July July: see month. 20, 2004, beginning at 9:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . Further details will be provided at a later date. Leader of U.S. Risk Management Solutions Resigns Separately, the Company said today that Amy B. McIntosh See Macintosh. , senior vice president of D&B and leader of U.S. Risk Management Solutions, has announced her intention to leave D&B at the end of June June: see month. 2004 to pursue other business interests most likely in the non-profit sector The nonprofit sector, also called the third sector, civic sector or voluntary sector, is a third area of an economy, distinct from the public sector and the private sector. It is made up of all of the non-profit organizations in the economy. . Use of Non-GAAP Financial Measures D&B reports non-GAAP financial measures in this press release and the schedules attached. D&B reports core revenue, revenue growth before the effects of foreign exchange, and each of operating income, net income and diluted earnings per share before non-core gains and charges and free cash flow. Please see D&B's Form 10-K for the fiscal year ended December 31, 2003 under the section entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: "Item 1. Business - How We Evaluate Performance" for a discussion of how the Company defines these measures, why it uses them and why it believes they provide useful information to investors. We also discuss organic revenue growth because management believes it provides an important insight into the underlying health of the business. First-Quarter Teleconference D&B will review its first-quarter financial results and 2004 outlook in a conference call with the investment community on Thursday Thursday: see week. , April 22, 2004, at 11 a.m. EDT. Live audio, as well as a replay of the conference call and other related information, will be accessible on D&B's Investor Relations Investor relations The process by which the corporation communicates with its investors. Web site at http://investor.dnb.com. About D&B D&B (NYSE: DNB), the leading provider of global business information, tools and insight, has enabled customers to Decide with Confidence for over 160 years. D&B's proprietary DUNSRight (TM) process provides customers with quality information whenever and wherever they need it. This quality information is the foundation of D&B's solutions that customers rely on to make critical business decisions. Customers use D&B Risk Management Solutions to mitigate mit·i·gate v. To moderate in force or intensity. mit i·ga tion n. risk, increase cash flow and drive increased profitability,
D&B Sales & Marketing Solutions to increase revenue from new and
existing customers, and D&B Supply Management Solutions to identify
purchasing savings, manage risk and ensure compliance within the supply
base. D&B's E-Business Solutions help customers convert
prospects to clients faster. For more information, please visit
www.dnb.com.Forward-Looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. and Cautionary Statements The section entitled "Full Year Outlook" of this press release contains projections of future results and other forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve a number of trends, risks and uncertainties and are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The following important factors could cause actual results to differ materially from those projected in such forward-looking statements. Demand for D&B's products is subject to intense competition, changes in customer preferences and economic conditions which impact customer behavior. The Company's results are also dependent upon its continued ability to: -- reallocate Verb 1. reallocate - allocate, distribute, or apportion anew; "Congressional seats are reapportioned on the basis of census data" reapportion allocate, apportion - distribute according to a plan or set apart for a special purpose; "I am allocating a loaf of expenses to invest for growth through its financial flexibility program; -- invest in its database and maintain its reputation for providing reliable data; -- execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution on its plan to improve the business model of its International segment and thereby improve its global data quality while realizing improved financial performance in that segment; -- grow its Risk Management Solutions; -- manage employee satisfaction and maintain its global expertise as it implements its financial flexibility program; -- protect against damage or interruptions affecting its database or its data centers; -- develop new products or enhance existing ones to meet customer needs. The Company is also subject to the effects of foreign economies, exchange rate fluctuations and U.S. and foreign legislative or regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. . Its results are also dependent upon the availability of data from its database. In addition, the Company's ability to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. shares is subject to market conditions, including trading volume Trading volume The number of shares transacted every day. As there is a seller for every buyer, one can think of the trading volume as half of the number of shares transacted. That is, if A sells 100 shares to B, the volume is 100 shares. in the Company's stock. Developments in any of these areas could cause results to differ materially from results that have been or may be projected. The Company's projection projection, in psychology: see defense mechanism. See rear-projection TV, front-projection TV and LCD panel. (theory) projection - In domain theory, a function, f, which is (a) idempotent, i.e. for free cash flow in 2004 is dependent upon, among other things, the Company's ability to generate revenue, the Company's collection processes, customer payment patterns and the amount and timing of payments related to tax matters and legal proceedings All actions that are authorized or sanctioned by law and instituted in a court or a tribunal for the acquisition of rights or the enforcement of remedies. involving the Company as more fully described in the Company's filings with the SEC as detailed below. 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 Annual Report on Form 10-K for the fiscal year ended December 31, 2003, including the section entitled "Item 7. Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial of Financial Condition and Results of Operations ("MD&A")," and the subsection subsection Noun any of the smaller parts into which a section may be divided Noun 1. subsection - a section of a section; a part of a part; i.e. entitled "Trends, Risks and Uncertainties" in the MD&A. Copies of the Company's Annual Report on Form 10-K are available on its web site at www.dnb.com and on the SEC's web site at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. . D&B cautions that the foregoing list of important factors is not complete and does not undertake to update any forward-looking statements.
Schedule 1
The Dun & Bradstreet Corporation
Consolidated Statement of Operations (unaudited) - As Reported
-----------
AFX Effects of
% Change Foreign BFX
Quarter Ended Fav/ Exchange % Change
March 31, (Unfav) Fav/(Unfav) Fav/(Unfav)
--------------- --------- ------------ -----------
2004 2003
-------- ------
Amounts in
millions, except
per share data
Revenue:
North America $250.5 $226.5 11% 1% 10%
International 91.8 74.8 23% 16% 7%
---------------- ------ ------
Core Revenue 342.3 301.3 14% 5% 9%
Divested
Businesses (1) 1.1 13.4 -92% 1% -93%
---------------- ------ ------
Total Revenue $343.4 $314.7 9% 4% 5%
---------------- ------ ------ ---- ----
Operating Income
(Loss):
North America $87.5 $80.3 9%
International 7.1 1.3 N/M
---------------- ------ ------
Total
Divisions 94.6 81.6 16%
Corporate and
Other (2) (29.1) (26.0) -12%
---------------- ------ ------
Operating Income 65.5 55.6 18%
---------------- ------ ------
Interest Income 2.1 .8 N/M
Interest Expense (4.6) (4.5) -1%
Other Income
(Expense) -
Net (3) 12.5 6.8 83%
---------------- ------ ------
Non-Operating Income
(Expense) - Net 10.0 3.1 N/M
---------------- ------ ------
Income before
Provision for
Income Taxes 75.5 58.7 29%
Provision for
Income Taxes 25.7 21.6 -19%
Equity in Net
Income (Loss) of
Affiliates - - -
---------------- ------ ------
Net Income (4) $49.8 $37.1 34%
---------------- ------ ------
Basic Earnings Per
Share of Common
Stock $.69 $.50 38%
---------------- ------ ------
Diluted Earnings Per
Share of Common
Stock (5) $.66 $.48 38%
---------------- ------ ------
Weighted Average
Number of Shares
Outstanding:
Basic 71.9 74.4 4%
---------------- ------ ------
Diluted 74.8 76.7 3%
---------------- ------ ------ -----
See Schedule 3 (Notes to Schedules), which is an integral part of the
consolidated statement of operations.
AFX - After Effects of Foreign Exchange
BFX - Before Effects of Foreign Exchange
This financial information should be read in conjunction with the
consolidated financial statements and related notes of The Dun &
Bradstreet Corporation contained in filings with the Securities and
Exchange Commission.
Schedule 2
The Dun & Bradstreet Corporation
Consolidated Statement of Operations (unaudited) -
Before Non-Core Gains and Charges
---------------------------------
AFX Effects of
% Change Foreign BFX
Quarter Ended Fav/ Exchange % Change
March 31, (Unfav) Fav/(Unfav) Fav/(Unfav)
--------------- --------- ------------ -----------
2004 2003
-------- -----
Amounts in
millions, except
per share data
Revenue:
North America $250.5 $226.5 11% 1% 10%
International 91.8 74.8 23% 16% 7%
---------------- ------ ------
Core Revenue 342.3 301.3 14% 5% 9%
Divested
Businesses (1) 1.1 13.4 -92% 1% -93%
---------------- ------ ------
Total Revenue $343.4 $314.7 9% 4% 5%
---------------- ------ ------ ---- ----
Operating Income
(Loss):
North America $87.5 $80.3 9%
International 7.1 1.3 N/M
---------------- ------ ------
Total
Divisions 94.6 81.6 16%
Corporate
and Other (2) (18.9) (15.1) -25%
---------------- ------ ------
Operating Income 75.7 66.5 14%
---------------- ------ ------
Interest Income 2.1 .8 N/M
Interest Expense (4.6) (4.5) -1%
Other Income
(Expense) -
Net (3) 0.8 (0.2) N/M
---------------- ------ ------
Non-Operating Income
(Expense) - Net (1.7) (3.9) 59%
---------------- ------ ------
Income before
Provision for
Income Taxes 74.0 62.6 18%
Provision for
Income Taxes 28.9 23.2 -25%
Equity in Net
Income (Loss) of
Affiliates - - -
---------------- ------ ------
Net Income (4) $45.1 $39.4 14%
---------------- ------ ------
Basic Earnings Per
Share of Common
Stock $.63 $.53 19%
---------------- ------ ------
Diluted Earnings
Per Share of
Common Stock (5) $.60 $.51 18%
---------------- ------ ------
Weighted Average
Number of Shares
Outstanding:
Basic 71.9 74.4 4%
---------------- ------ ------
Diluted 74.8 76.7 3%
---------------- ------ ------ -----
See Schedule 3 (Notes to Schedules), which is an integral part of the
consolidated statement of operations.
AFX - After Effects of Foreign Exchange
BFX - Before Effects of Foreign Exchange
Non-Core Gains and Charges - For internal management purposes, we
treat certain pre-tax gains and charges which are included in
"Corporate and Other" and "Other Income (Expense) - Net" as non-core
gains and charges. These non-core gains and charges are summarized in
Schedule 3. We exclude non-core gains and charges when evaluating our
financial performance because they are not a component of our ongoing
income or expense and may have a disproportional positive or negative
impact on the results of our ongoing underlying business operations.
This financial information should be read in conjunction with the
consolidated financial statements and related notes of The Dun &
Bradstreet Corporation contained in filings with the Securities and
Exchange Commission.
Schedule 3
The Dun & Bradstreet Corporation
Notes to Schedules 1 and 2 (unaudited)
(1) 2004 includes revenues from the Company's operations in Nordic
(Sweden, Denmark, Norway and Finland), and India and Distribution
Channels in Pakistan and the Middle East and 2003 includes revenues
from the Company's operations in Israel, Nordic, and India and
Distribution Channels in Pakistan and the Middle East.
(2) The following table reconciles Corporate and Other expenses
included in Schedule 1 and Schedule 2:
Quarter Ended
March 31,
---------------
% Change
Amounts in millions 2004 2003 Fav/(Unfav)
--------------------------------------- ------- ------- -----------
Corporate and Other - As Reported
(Schedule 1) $(29.1) $(26.0) -12%
Restructuring Charge (10.2) (10.9) N/M
------- -------
Corporate and Other - Before Non-Core
Gains and Charges (Schedule 2) $(18.9) $(15.1) -25%
------- ------- --------
(3) The following table reconciles Other
Income (Expense)-Net included in Schedule 1
and Schedule 2:
Quarter Ended
March 31,
---------------
% Change
Amounts in millions 2004 2003 Fav/(Unfav)
--------------------------------------- ------- ------- -----------
Other Income (Expense)-Net - As
Reported (Schedule 1) $12.5 $6.8 83%
Gain on Sales of Operations in Nordic
(Sweden, Denmark, Norway and
Finland), and India and
Distribution Channels in Pakistan
and the Middle East 11.7 - N/M
Insurance Recovery related to
World Trade Center Tragedy - 7.0 N/M
------- -------
Other Income (Expense)-Net - Before
Non-Core Gains and Charges (Schedule 2) $.8 $(.2) N/M
------- ------- --------
(4) The following table reconciles Net Income
included in Schedule 1 and Schedule 2:
Quarter Ended
March 31,
---------------
% Change
Amounts in millions 2004 2003 Fav/(Unfav)
--------------------------------------- ------- ------- -----------
Net Income - As Reported (Schedule 1) $49.8 $37.1 34%
Restructuring Charge (6.8) (6.6) N/M
Gain on Sales of Operations in
Nordic (Sweden, Denmark, Norway and
Finland), and India and
Distribution Channels in Pakistan
and the Middle East 11.5 - N/M
Insurance Recovery related to
World Trade Center Tragedy - 4.3 N/M
------- -------
Net Income - Before Non-Core Gains and
Charges (Schedule 2) $45.1 $39.4 14%
------- ------- --------
(5) The following table reconciles Diluted
Earnings Per Share included in
Schedule 1 and Schedule 2:
Quarter Ended
March 31,
---------------
% Change
2004 2003 Fav/(Unfav)
--------------------------------------- ------- ------- -----------
Diluted EPS - As Reported (Schedule 1) $.66 $.48 38%
Restructuring Charge (.09) (.09) N/M
Gain on Sales of Operations in
Nordic (Sweden, Denmark, Norway and
Finland), and India and
Distribution Channels in Pakistan
and the Middle East .15 - N/M
Insurance Recovery related to
World Trade Center Tragedy - .06 N/M
------- -------
Diluted EPS - Before Non-Core Gains and
Charges (Schedule 2) $.60 $.51 18%
------- ------- --------
This financial information should be read in conjunction with the
consolidated financial statements and related notes of The Dun &
Bradstreet Corporation contained in filings with the Securities and
Exchange Commission.
Schedule 4
The Dun & Bradstreet Corporation
Supplemental Financial Data (unaudited)
Quarter Ended
March 31, Effects of
---------------- AFX Foreign BFX
2004 2003 % Change Exchange % Change
Amounts in -------- ------- Fav/(Unfav) Fav/(Unfav) Fav/(Unfav)
millions ----------- ----------- -----------
-----------------
Geographic and
Product Line
Revenue:
North America:
Risk Management
Solutions $161.3 $151.7 6% 0% 6%
Sales & Marketing
Solutions 72.6 66.9 9% 0% 9%
Supply Management
Solutions 5.5 5.4 1% 0% 1%
E-Business
Solutions 11.1 2.5 N/M N/M N/M
-------- -------
Core Revenue 250.5 226.5 11% 1% 10%
Divested
Businesses - - 0% 0% 0%
-------- -------
Total North
America 250.5 226.5 11% 1% 10%
-------- -------
International:
Risk Management
Solutions 75.3 60.8 24% 16% 8%
Sales & Marketing
Solutions 14.3 12.0 20% 15% 5%
Supply Management
Solutions 2.2 2.0 10% 13% -3%
-------- -------
Core Revenue 91.8 74.8 23% 16% 7%
Divested
Businesses 1.1 13.4 -92% 1% -93%
-------- -------
Total
International 92.9 88.2 5% 13% -8%
-------- -------
Total
Corporation:
Risk Management
Solutions 236.6 212.5 11% 5% 6%
Sales & Marketing
Solutions 86.9 78.9 10% 2% 8%
Supply Management
Solutions 7.7 7.4 4% 4% 0%
E-Business
Solutions 11.1 2.5 N/M N/M N/M
-------- -------
Core Revenue 342.3 301.3 14% 5% 9%
Divested
Businesses 1.1 13.4 -92% 1% -93%
-------- -------
Total Revenue $343.4 $314.7 9% 4% 5%
-------- ------- --------- ---------
Operating Costs:
Operating
Expenses $103.2 $106.1 3%
Selling and
Administrative
Expenses 152.5 125.9 -21%
Depreciation and
Amortization 12.0 16.2 26%
Restructuring
Expense 10.2 10.9 7%
-------- -------
Total Operating
Costs $277.9 $259.1 -7%
-------- -------
Capital
Expenditures $3.6 $3.7 3%
-------- -------
Additions to
Computer
Software & Other
Intangibles $1.7 $2.2 23%
-------- ------- ---------
Mar 31, Dec 31, Sep 30, Jun 30, Mar 31,
2004 2003 2003 2003 2003
-------- ------- ----------- ----------- -----------
Net Debt
Position:
Cash and Cash
Equivalents
(6) $197.4 $239.0 $199.7 $127.4 $149.3
Notes Payable - - - - (.1)
Long-Term Debt (299.9) (299.9) (299.9) (299.8) (299.8)
-------- ------- ----------- ----------- -----------
Net Debt $(102.5) $(60.9) $(100.2) $(172.4) $(150.6)
-------- ------- ----------- ----------- -----------
(6) In addition to
Cash and Cash Equiv.
we had the following
net (investments)
redemptions in
Marketable
Securities $(87.7) $.6 $32.0 $(20.9) $(7.4)
-------- ------- ----------- ----------- -----------
Mar 31, Mar 31, % Change
2004 2003 Fav/(Unfav)
------- ----------- -----------
Free Cash Flow:
Net Cash Provided By
Operating Activities (As
Reported) $71.2 $60.7 17%
Less:
Capital
Expenditures
(As Reported) 3.2 3.7 14%
Additions to Computer
Software & Other
Intangibles (As
Reported) 1.7 2.2 23%
------- -----------
Free Cash Flow $66.3 $54.8 21%
------- ----------- ---------
Quarter Ended
--------------------------
Mar 31, 2004 Dec 31, 2003
------------ ------------
Reconciliation of
Organic Revenue
Growth:
Total Revenue AFX 9% 14%
Less: Favorable Effects
of Foreign Exchange 4% 5%
------- -----------
Total Revenue BFX 5% 9%
Add: Effect of Divested
Businesses BFX 4% 1%
------- -----------
Core Revenue BFX 9% 10%
Less: Acquisition Revenue BFX 3% 4%
------- -----------
Organic Revenue
BFX 6% 6%
------- -----------
AFX - After Effects of Foreign Exchange
BFX - Before Effects of Foreign Exchange
This financial information should be read in conjunction with the
consolidated financial statements and related notes of The Dun &
Bradstreet Corporation contained in filings with the Securities and
Exchange Commission.
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