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IHS, Inc. (IHS)
F3Q 2011 Earnings Call
September 21, 2011 8:00 a.m. ET
Andy Schulz - Vice President, Investor Relations
Jerre Stead - Chairman and Chief Executive Officer
Richard Walker - EVP and Chief Financial Officer
Scott Key - President and COO
Peter Appert - Piper Jaffray
Manav Patnaik - Barclays Capital
Suzanne Stein - Morgan Stanley
Eric Boyer - Wells Fargo
Michael Meltz - JPMorgan
William Warmington - Raymond James
Kelly Flynn - Credit Suisse
William Packer - Exane BNP Paribas
Mig Dobre - Robert W. Baird & Company
Robert Riggs - William Blair
Previous Statements by IHS
» IHS CEO Discusses Seismic Micro-Technology Acquisition Closing and Integration - Call Transcript
» IHS Inc. F3Q09 (Qtr End 08/31/09) Earnings Call Transcript
» IHS, Inc. F4Q08 (Qtr End 11/30/2008) Earnings Call Transcript
I would like to now hand the call over to your host for today, Mr. Andy Schulz, Vice President, Investor Relations. Mr. Schulz, over to you please.
Thank you, Katy. Good morning and thank you for joining us for the IHS third quarter 2011 earnings conference call. We issued our earnings release earlier this morning. If you do not have the release we issued today, you will find a copy on our website at ihs.com. Some of our comments and discussions on the quarter are based on non-GAAP measures. Our non-GAAP or adjusted numbers exclude stock-based compensation and other non-cash charges, net pension expense and other items.
Our earnings release includes both our GAAP-based income statement and statement of cash flows, and reconciliations to the non-GAAP measures discussed during this call. These reconciliation schedules can also be found on our website. The non-GAAP results are a supplement to the GAAP financial statements. IHS believes this non-GAAP presentation and the elimination of these items is useful in order to focus on what we deem to be a more reliable indicator of ongoing operating performance.
As a reminder, this conference call is being recorded and webcast, and is the copyrighted property of IHS. Any rebroadcast of this information in whole or in part without the prior written consent of IHS is prohibited.
Please keep in mind that this conference call, especially the discussion of our outlook, may contain statements about expected future events that are forward-looking and subject to risks and uncertainties. Factors that could cause actual results to differ and vary materially from expectations can be found in IHS's filings with the SEC and on the IHS website.
With that, it is my pleasure to turn the call over to Jerre Stead, IHS Chairman and CEO. Jerre?
Thank you, Andy. Good morning and welcome to all of our investors and to my IHS colleagues. This morning I will provide an overview of our quarterly performance, highlight a major milestone for our Vanguard initiative and discuss another new partnership. Regarding the quarterly financial highlights, revenue was up 25% for the third quarter, adjusted EBITDA increased 22%, and we delivered $0.88 of adjusted EPS for the quarter.
Q3 was another quarter of solid, profitable growth in this time of ever greater economic uncertainty. Our performance is a testament to both the must have nature of our portfolio and the ongoing great work by my IHS colleagues worldwide. I thank them all for their continued efforts and focus on delighting our customers. Scott Key, our President and COO, and Rich Walker, our EVP and CFO will provide more details.
As we reflect in the third quarter, we accomplished many notable things. Including continued strong financial and operating performance as well as the purchase and close of SMT, our largest acquisition ever. We had a very important accomplishment with the successful first release of Vanguard in July, concurrent with the opening of our first customer care center. This has been an effort for four years in the making and it is important to recognize this milestone.
Vanguard is our business transformation initiative to consolidate and standardize our sales force automation, lead-to-cash and financial supporting systems. We moved the first series of legacy accounts payable, general ledger and order management processes to our new system on July 5. This initial phase of implementation included a representative set of our transactions. Our first go-live was truly a team effort. Colleagues from throughout IHS have invested many hours of their time to provide input on how Vanguard should be created. This was to ensure it was built to meet the current needs of IHS as well as creating scalable finance and customer care processes.
As we continue to grow and become a multi-billion dollar company. Congratulations to the Vanguard team and all of our colleagues and our partners who have participated in the planning and implementation for their exceptional efforts in making the first release of Vanguard a realty, and for meeting our schedule. Thank you for your commitment and your efforts.
As we have discussed previously, we have used a phased implementation approach. This was the first of multiple releases with our next release planned for early fiscal 2012. Our current plan calls for substantially all of our finance and lead to cash systems to be migrated over to Vanguard by the end of 2012. Our sales colleagues continued to leverage sales force automation or SFA, an important part of our Vanguard initiative. We have more than doubled the number of single sales opportunities identified within it. Currently within SFA, we have identified 54,000 SSOs representing close to $1.5 billion of business. By early next year we will have 100% of our business going through SFA, which will give us increased visibility to our sales pipeline.