Interactive Data sees steady revenues in Q4’14, income drops 29% Q/Q

Interactive Data Corporation, the trading infrastructure and financial information services provider, has just reported its financial metrics for the fourth quarter and full year 2014, with revenues showing a continued rise but income from operations registering a double-digit drop when compared to results from the preceding quarter.

Let’s take a look at the numbers.

Q4 2014 highlights

  • Income from operations in the final three months of 2014 amounted to $41.2 million, down by significant 29% on the $58.1 million figure, registered in the third quarter of 2014. The fourth-quarter result also lagged behind the $41.8 million in income from operations recorded in the final quarter of 2013.
  • While we are on this topic, we should perhaps mention something about operating expenses too as during the final quarter of 2014, the company registered $11 million of non-cash impairment expense related to previously capitalized development costs, and $10.3 million of severance expense.
  • Revenues in the fourth-quarter of 2014 amounted to $239.3 million, up by 2.48% from the third-quarter reading and up by 3.1% from the result recorded in the equivalent period in 2013.
  • Non-GAAP adjusted EBITDA reached $98.2 million in the fourth-quarter of 2014, up by 5.03% from the third-quarter result and up by 9.8% against the equivalent period a year earlier.

Full Year 2014 Highlights

  • For the year to December 31, 2014, income from operations amounted to $168.1 million, marking a drop of 4.5% from the previous year.
  • Full-year non-GAAP Adjusted EBITDA was $362.4 million, compared with $351.6 million in 2013.
  • Full-year revenues were robust, amounting to $939.2 million, up by 3.8% from the result of $905.1 million seen in 2013.

What’s behind the numbers

The revenue growth reflected solid performance at Interactive Data’s Pricing and Reference Data segment, which recorded growth across all geographic regions. The Trading Solutions segment was also strong, with organic revenue growth driven by the Company’s 7ticks trading infrastructure services and real-time feeds product areas in connection with large client implementations. This growth, however, felt the effect of declines in the segment’s customized hosted web applications and workstations product areas.

Management Comment

Interactive Data’s president and CEO Stephen Daffron commented:

“Interactive Data finished 2014 with strong operating performance and we are well positioned to generate continued revenue and profit growth in 2015. Our fourth quarter organic revenue growth of 4.3% was driven by a combination of growth in our Pricing and Reference Data segment and growth in our real-time feeds and 7ticks trading infrastructure businesses. We generated Adjusted EBITDA of $98.2 million during the quarter, reflecting our continued commitment to cost containment and driving operating efficiencies.”

To download the full report by Interactive Data, click here.

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