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1Q 2019 Investor Presentation
May 8, 2019
May 8, 2019 2
DisclaimerCertain statements contained in this release are forward-looking statements and are based on future expectations, plans and prospects for the Company’s business and operations that involve a number of risks and uncertainties. The forward-looking statements and other information in this release are made as of the date hereof (except where noted otherwise), and the Company undertakes no obligation (nor does it intend) to publicly supplement, update or revise such statements on a going-forward basis, whether as a result of subsequent developments, changed expectations or otherwise. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, the Company is identifying examples of factors, risks and uncertainties that could cause actual results to differ, perhaps materially, from those indicated by these forward-looking statements. Those factors, risks and uncertainties include, but are not limited to, credit market disruptions or economic slowdowns, which could affect the volume of debt and other securities issued in domestic and/or global capital markets; other matters that could affect the volume of debt and other securities issued in domestic and/or global capital markets, including regulation, credit quality concerns, changes in interest rates and other volatility in the financial markets such as that due to the U.K.’s planned withdrawal from the EU; the level of merger and acquisition activity in the U.S. and abroad; the uncertain effectiveness and possible collateral consequences of U.S. and foreign government actions affecting credit markets, international trade and economic policy; concerns in the marketplace affecting our credibility or otherwise affecting market perceptions of the integrity or utility of independent credit agency ratings; the introduction of competing products or technologies by other companies; pricing pressure from competitors and/or customers; the level of success of new product development and global expansion; the impact of regulation as an NRSRO, the potential for new U.S., state and local legislation and regulations, including provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) and regulations resulting from Dodd-Frank; the potential for increased competition and regulation in the EU and other foreign jurisdictions; exposure to litigation related to our rating opinions, as well as any other litigation, government and regulatory proceedings, investigations and inquires to which the Company may be subject from time to time; provisions in the Dodd-Frank Act legislation modifying the pleading standards, and EU regulations modifying the liability standards, applicable to credit rating agencies in a manner adverse to credit rating agencies; provisions of EU regulations imposing additional procedural and substantive requirements on the pricing of services and the expansion of supervisory remit to include non-EU ratings used for regulatory purposes; the possible loss of key employees; failures or malfunctions of our operations and infrastructure; any vulnerabilities to cyber threats or other cybersecurity concerns; the outcome of any review by controlling tax authorities of the Company’s global tax planning initiatives; exposure to potential criminal sanctions or civil remedies if the Company fails to comply with foreign and U.S. laws and regulations that are applicable in the jurisdictions in which the Company operates, including data protection and privacy laws, sanctions laws, anti-corruption laws, and local laws prohibiting corrupt payments to government officials; the impact of mergers, acquisitions or other business combinations and the ability of the Company to successfully integrate such acquired businesses; currency and foreign exchange volatility; the level of future cash flows; the levels of capital investments; and a decline in the demand for credit risk management tools by financial institutions. These factors, risks and uncertainties as well as other risks and uncertainties that could cause Moody’s actual results to differ materially from those contemplated, expressed, projected, anticipated or implied in the forward-looking statements are described in greater detail under “Risk Factors” in Part I, Item 1A of the Company’s annual report on Form 10-K for the year ended December 31, 2018, and in other filings made by the Company from time to time with the SEC or in materials incorporated herein or therein. Stockholders and investors are cautioned that the occurrence of any of these factors, risks and uncertainties may cause the Company’s actual results to differ materially from those contemplated, expressed, projected, anticipated or implied in the forward-looking statements, which could have a material and adverse effect on the Company’s business, results of operations and financial condition. New factors may emerge from time to time, and it is not possible for the Company to predict new factors, nor can the Company assess the potential effect of any new factors on it.
May 8, 2019 3
Table of Contents1. Moody’s Overview2. Financial Overview3. Capital Markets Overview4. Moody’s Investors Service (MIS)5. Moody’s Analytics (MA)6. Appendix
1 Moody’s Overview
May 8, 2019 5
Provides financial intelligence and analytical tools supporting our clients’ growth, efficiency and risk management objectives
Solutions address diverse needs and customers
Extending brand into new markets and deepening customer relationship
Leading global provider of credit rating opinions, insight and tools for financial risk measurement and management
Independent provider of credit rating opinions and related information for over 100 years
Proven ratings accuracy and deeply experienced analysts
Expanded sales and marketing activities in Commercial group
Revenue of $4.5 billion
Adjusted Operating Income
of $2.1 billion
MIS 77%
MA 23%
MIS 60%
MA 40%
Note: Financial data for the trailing twelve months ended March 31, 2019.
Moody’s Mission: To be the World’s Most Respected Authority Serving Risk-Sensitive Financial Markets
Adjusted Operating Margin
MIS 57.5%
MA 27.2%
May 8, 2019 6
Moody’s Strategic Priorities
Enhance technology infrastructure to enable automation, innovation and efficiency
Foster employee engagement and creative solutions through our diverse workforce and inclusive environment
Private Co. Data / SME
Business Adjacencies
ESG Cyber RiskCommercial Real Estate
Emerging Markets
Private Co. Data / SME
Regional Expansion
Credit Pyramid
Asia-Pacific
Latin AmericaEMEA
May 8, 2019 7
Why Invest in Moody’s?
We strive to be the world’s most respected authority
serving risk-sensitive financial markets
We have had strong revenue and earnings
growth, as well as cash flow conversion
We are committed to returning capital to our shareholders
We will selectively invest in strategic
growth opportunities
May 8, 2019 9
ESG Drives Sustained Corporate ValueIntroduced ESG Disclosures in our Public Filings
1. While the Company reports its financial results in accordance with GAAP, financial performance targets and results under the Company’s incentive plans are based on adjusted financial measures. These metrics and the related performance targets are relevant only to Moody’s executive compensation program and should not be used or applied in other contexts.
2. This measure is a qualitative assessment of strategic and operational metrics tied to key non-financial business objectives certified by the Compensation & Human Resources Committee at the beginning of the performance period. The Committee assessed the achievement of the metric by evaluating performance against the following objectives: (i) new sources of growth; (ii) quality assurance and controls; (iii) operating effectiveness and efficiency; (iv) people and culture; (v) risk management; and (vi) enabling technologies and capabilities.
Executive compensation metrics include1:» Moody’s Corporation EPS, operating income and EBITDA
» MIS operating income and ratings accuracy » MA operating income and sales
» Strategic & operational2
E N V I R O NM E N TAL» Measurement of carbon
emissions and identification of opportunities to reduce indirect GHG emissions
» Expansion of ESG products and services
» CDP participation
S O C I AL» Support a diverse
and inclusive workplace» Active global community
and philanthropic involvement» Robust data security
and privacy practices» Fair compensation practices and benefits packages» Recognized as top 10 employer by Working
Mother’s list of 100 Best Companies
G O V E R N AN C E» Professional integrity» Systematic risk management» Diverse Board membership
and skill sets» Separate CEO and
Chairman positions» Active shareholder
engagement
2 Financial Overview
May 8, 2019 11
Long-Term Growth OpportunitiesThree Levers to Achieve EPS Growth
Note: Long-term growth opportunities presented on this slide are on average over time.1. Assumes no material change in effective tax rate, foreign exchange rates, leverage profile and/or capital allocation policy.2. Subject to market conditions and other ongoing capital allocation decisions.
May 8, 2019 12
$2.3 $2.3 $2.4 $2.8 $2.7
$1.1 $1.2 $1.2$1.4 $1.7
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
2014 2015 2016 2017 2018 2019F
$ Bi
llions
MIS Revenue MA Revenue
$3.3 $3.5 $3.6$4.2 $4.4
$1,003 $1,109 $1,144
$664
$1,371
$1,600 - $1,700
$500
$700
$900
$1,100
$1,300
$1,500
$1,700
2014 2015 2016 2017 2018 2019F14
Operating Margin3
Adjusted Diluted EPS2RevenueMid-single-digit
% growth
$4.31 $4.71 $4.94$6.07
$7.39
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
2014 2015 2016 2017 2018 2019F
43.5
%
42.8
%
18.1
%
43.3
%
42.1
%
46.3
%
46.0
%
45.9
%
47.6
%
47.7
%
0%10%20%30%40%50%60%
2014 2015 2016 2017 2018 2019F
Operating Margin Adj. Operating Margin
~ 48
%~
43%
Free Cash Flow2
$7.85to
$8.10
1 1
1
2
Financial Performance
1. Guidance as of April 24, 2019.2. These figures are adjusted measures. See appendix for reconciliations from adjusted financial measures to U.S. GAAP.3. 2014 – 2017 operating and adjusted operating margins have been restated to conform to the new presentation for pension expenses.4. Net of $701 million tax settlement charge.
$ Millions
May 8, 2019 13
57%
43%
Recurring Transaction
1Q 2019 TTM Revenue: $4.5 billionMoody’s Corporation Financial Profile
53%
47%
U.S. Non-U.S.
Full Year 2019 Revenue Guidance as of April 24, 20191
Revenue • increase in the mid-single-digit % range
Operating Expenses2 • increase in the mid-single-digit % range
Operating Margin • approximately 43%
Adjusted Operating Margin3 • approximately 48%
Effective Tax Rate • 21% - 22%
Diluted EPS • $7.30 - $7.55
Adjusted Diluted EPS3 • $7.85 - $8.101. See press release titled “Moody's Corporation Reports Results for First Quarter 2019” from April 24, 2019 for Moody’s full 2019 guidance. 2. Includes depreciation and amortization, Acquisition-Related Expenses and restructuring charges.3. These metrics are adjusted measures. See Appendix for reconciliations from adjusted financial measures to U.S. GAAP.Note: The revenue reclassifications of REITs from Corporate Finance to Structured Finance and the FACT product from RD&A to ERS are reflected in the trailing twelve month (TTM) calculations.
CFG30%
SFG10%
FIG10%
PPIF9%
MIS Other1%
RD&A26%
ERS11%
PS3%
MA
MIS
May 8, 2019 14
$1,221 $1,098
$739
$200 $203
~$1,000
$236$272
$285
$290 $337
25%-30% payout1
$0
$400
$800
$1,200
$1,600
150
170
190
210
230
2014 2015 2016 2017 2018 2019
$ Millions
Mill
ions
of S
hare
s
Share Repurchases (R) Dividends Paid (R)Shares Outstanding (L)
$1,457 $1,370
Disciplined Approach to Capital Allocation…
Share Repurchases and Dividends Paid Annualized Dividend Per Share
$1,024
Investing in Growth Opportunities Return of Capital
ReinvestmentInvest in existing
businesses to support organic
growth
AcquisitionsEvaluate carefully to make sure aligned with strategy and market evolution
DividendsGrow dividend in line with earnings; target 25% - 30% payout1
Share RepurchaseFollow reinvestment,
dividends and acquisitions in capital allocation prioritization
$1.12$1.36
$1.48 $1.52$1.76
$2.00
2014 2015 2016 2017 2018 2Q192
$490 $540
1. Dividend payout ratio is defined as total dividends paid/adjusted net income. 2. Annualized dividend total, based on first and second quarter dividends of $0.50 declared on February 15, 2019 and April 16, 2019.
May 8, 2019 15
» Committed to leverage anchored around a BBB+ rating
» Strong track record of de-leveraging through cash flow within nine months of Bureau Van Dijk acquisition
» Well-laddered maturities; no significant debt maturities until September 2020
» Leverage expected to decline over the remainder of 20194
2.0x
0.0x
0.5x
1.0x
1.5x
2.0x
2.5x
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
2017 2018 1Q19 2019
$ B
illio
ns
Net DebtNet Debt/TTM Adj. Operating Income (R)
…and Capital Management
1
1. Trailing twelve months adjusted operating income. Amounts are adjusted measures. See Appendix for reconciliations from adjusted financial measures to U.S. GAAPand gross debt to net debt.
2. TTM only applies to income and cash flow statement items.3. Amounts are adjusted measures. See Appendix for reconciliations from adjusted financial measures to U.S. GAAP and gross debt to net debt.4. Subject to market conditions and other ongoing capital allocation decisions.
($ Billions) TTM 1Q192
Adjusted Operating Income3 $2.1 Interest Expense $0.2 Capital Expenditures $0.1 Free Cash Flow3 $1.3
Debt $5.5Cash, Cash Equivalents & ST Investments $1.3 Net Debt $4.2
Net Debt/Adjusted Operating Income1 2.0x
May 8, 2019 16
Step 02
Step 03
Step 01
» Product enhancements drivingcustomer upgrades and new sales in RD&A, supporting growth across multiple business lines
» Bureau van Dijk synergies on track to achieve ~$45 million run rate
» ERS resumes growth as transition from licenses and services to SaaS passes inflection point
» Reis and Omega Performance integrated, and $0.02 accretive to adjusted diluted EPS
MA» Stable economic fundamentals and
GDP growth in developed regions
» Market disruption to start the year, followed by spread tightening and issuance markets normalization
» Slight contraction assumed in annual global issuance
» Tighter credit seen moderating new mandates
» Recurring revenue and pricing initiatives support growth
» Issuance expected to be flat to down 5% compared to 2018
MIS
» Restructuring: Annualized pre-tax savings anticipated to be $40-50 million following anticipated 2Q19 completion, providing optionality to reinvest or reduce costs depending on market conditions
» Strategic management of real estate footprint and hiring activity» Limited ~$10 million expense ramp2 expected from Q1 to Q4 2019» Remainder of year FX assumptions: British pound (£): $1.30 to £1 and Euro (€): $1.12 to €1
Moody’s
2019 Guidance Drivers1
1. Guidance as of April 24, 2019.2. Expense ramp relates to total operating expenses. Total operating expenses include depreciation and amortization, Acquisition-Related
Expenses and restructuring charges.
3 Capital Markets Overview
May 8, 2019 18
FINANCIAL STABILITYFinancial stability, a fundamental buildingblock for the global economy and markets.
GROWTHEconomic growth, a coreunderpinning of creditconditions and quality.
TRADE TENSIONSUS trade policy is the mostpotent, far-reaching sourceof global risk withsignificant sector andregional impacts thatcould derail the globaleconomy.
TECHNOLOGY AND INNOVATIONTechnology and innovation have the potential toreshape the credit landscape for countries, banks and companies.
POLITICAL RISKSHeightened political risks will pose the greatest source of uncertainty to credit conditions and quality.CYCLICAL
THEMES
SECULARTRENDS
ESG RISKSThe transition to a low-carboneconomy and social anddemographic change have the potential to alter credit profiles.
Six Main Themes Will Shape Global Credit in 2019 and Beyond
Source: Moody’s Investors Service.
May 8, 2019 19
Debt Leverage and Interest Coverage Remain Stable in North America and EuropeCredit Metrics: North American Speculative Grade Companies
1. Trailing twelve months as of April 30, 2019.Source: Moody’s Investors Service.
4.6x 4.6x 4.7x 4.5x 4.3x 4.4x 4.6x 4.8x 5.0x 5.1x 5.2x 5.4x 5.2x 5.2x
2.9x 2.6x 2.4x 2.7x 3.0x 3.1x 3.0x 3.0x 3.0x 2.9x 3.0x 3.0x 3.1x 3.0x
0.0x1.0x2.0x3.0x4.0x5.0x6.0x
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Inte
rest
Cov
erag
e
Debt / EBITDA EBITDA / Interest Expense
Credit Metrics: European Speculative Grade Companies
4.8x4.1x 4.1x 4.5x
4.0x 4.0x 4.2x 4.4x 4.6x 4.5x 4.5x 4.5x 4.7x 4.6x
3.0x 3.0x 2.9x 3.1x 3.4x 3.4x 3.2x 3.1x 3.2x 3.3x 3.6x 3.8x 3.9x 3.9x
0.0x1.0x2.0x3.0x4.0x5.0x6.0x
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Inte
rest
Cov
erag
e
Debt / EBITDA EBITDA / Interest Expense
1
1
May 8, 2019 20
1.5%1.7%1.8%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%Global U.S. Europe
Global Default Rates Remain Under Historic Average; Continue to Monitor Covenant QualityDefault Rates for Speculative-Grade Corporate Rated Issuance1
4.2% global historic average1
» Global speculative-grade default rate at 1.9% as of March 31, 2019; expected to decrease to 1.5% by March 2020
» Speculative-grade U.S. bond covenant quality weakening but stable leverage levels support belief that issuer credit conditions remain adequate
1. Moody’s rated corporate global speculative grade default historical average of 4.2% since 1983. 2020 forecast for trailing twelve months ended March 31, 2020.2. As of the trailing twelve months ended March 31, 2019.Source: Moody’s Investors Service.
4.07x
4.45x
3.80x
2.00
2.50
3.00
3.50
4.00
4.50
5.00
2012 2013 2014 2015 2016 2017 2018 1Q19
U.S. Loans U.S. Bonds European Bonds
Speculative-Grade Covenant Quality Indicators
Weakening
Improving2
May 8, 2019 21
$160$173
$102 $96$107
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
0
50
100
150
200
1Q18 2Q18 3Q18 4Q18 1Q19
Non-Financial Corporate Issuance: Market Preference Shifts Towards Fixed Rate Instruments
U.S. Bank Loans
1. MIS rated issuance. 2. IG yield % per Federal Reserve; HY and bank loan issuance yield % per LPC; bank loans are large corporate average.3. Sources: Refinitiv, Lipper and Wall Street Research.
Issuance33% Y/Y
$56$46
$28$20
$56
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
1Q18 2Q18 3Q18 4Q18 1Q19
Issuance ($ Billions) Yield %
U.S. IG Bonds U.S. HY Bonds
$145$154
$109 $114
$173
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
0
00
00
00
00
00
00
00
00
00
00
1Q18 2Q18 3Q18 4Q18 1Q19
Issuance19% Y/Y
Issuance1% Y/Y
1 2
1Q19 Market Metrics3 IG HY BLTotal Returns 5.0% 7.6% 4.0%Fund Flows ($B) $46 $12 $(10)
May 8, 2019 22
177 226 254 231 20533
6893 146 15311
4797
189 266
$0$100$200$300$400$500$600$700
2019 2020 2021 2022 2023
$ Bi
llions
Investment Grade Speculative Grade Bonds Speculative Grade Bank Loans
North America and EMEA Non-Financial Corporates Have Significant Refunding Needs1
Debt Maturities: North America Moody’s-Rated Corporate Bonds and Loans
Source: Moody’s Investors Service, January 2019.Note: Data represents U.S. & Canadian MIS rated corporate bonds & loans.
Debt Maturities: EMEA Moody’s-Rated Corporate Bonds and Loans
Source: Moody’s Investors Service, July 2018.
1. Amount reflects total maturities identified in the above sources.
$221 $341$444
$566$624
247 248 246 263
33 37 528840 50 5975
$0
$100
$200
$300
$400
$500
2019 2020 2021 2022
$ Bi
llions
Investment Grade Speculative Grade Bonds Speculative Grade Bank Loans
$320 $335 $357$426
» Five-year debt maturities for U.S. non-financial investment-grade corporates exceed $1 trillion for the second year in a row
» Five-year U.S. speculative grade bank loans refinancing needs up $47 billion, or 8%, from a year ago
» Four-year debt maturities for EMEA non-financial corporates exceed $1.4 trillion, up more than $230 billion, or 19%, from the prior year
May 8, 2019 23
$1,972
$2,948
$1,000
$1,300
$1,600
$1,900
$2,200
$2,500
$2,800
$3,100
Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19
$ B
illio
ns
Refunding Needs Have Grown Strongly Over Time
Next Four Years U.S. and EMEA Total Refunding Needs1 as of:
1. Amount reflects total maturities identified below.Source: Moody’s Investors Service. U.S. and EMEA refunding needs reports January 2012 – January 2019.Note: Data represents U.S. and European MIS rated corporate bonds & loans.
May 8, 2019 24
Debt Refinancing and M&A are Most Frequently Stated Uses of Proceeds Uses of Funds from USD High Yield Bonds and Bank Loans1
62% 52%
83%
71% 74% 78%71%
65%54%
64%71%
63%63%
63% 53%
19%
31% 30% 25%31%
41% 54%41%
39%48%
37%
22% 17%11%
7% 8% 8% 7% 8%5% 6%
5% 6% 7%
12% 9% 4%18% 17% 18% 22% 20% 16% 17% 13% 14% 10%
1999 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19
% o
f Men
tions
Debt Refinancing M&A Capital Spending Shareholder Payments
1. Percent of mentions for each respective period in bond issue or bank loan program tranche documents. Excludes issues of less than $25 million and general corporate purposes. An issue can have multiple purposes and, as a result, percentages do not sum to 100%.
Source: Moody’s Analytics.
May 8, 2019 25
Disintermediation of Credit is an Ongoing Trend in the Global Capital Markets
European Non-Financial Corporate Bonds vs. Bank Loans Outstanding
48%
€0
€1,000
€2,000
€3,000
€4,000
€5,000
€6,000
€7,000
€Bi
llions
Bonds Loans
U.S. Non-Financial Corporate Bonds vs. Bank Loans Outstanding
48%
$0
$1,500
$3,000
$4,500
$6,000
$7,500
$9,000
$ Bi
llions
Bonds Loans
75%
25%
50%
50%
Sources: ECB, Federal Reserve, BarCap Indices. Europe bank loan data includes Eurozone and UK bank loans. Europe bond data includes euro and sterling denominated bonds. European data is through February 2019 and U.S. data is through March 2019.
May 8, 2019 26
New Rating Mandates Provide Recurring Revenue1
Growth
0
400
800
1,200
2014 2015 2016 2017 2018 2019F
# of
New
Man
date
s
EMEA United States Rest of World
1,044
Global New Rating Mandates2
» Expect ~900 new mandates in 20193
» MIS recurring revenue growth of 4% for the trailing twelve months as of 1Q19, primarily driven by increased volume of monitoring fees from recent new mandates
990
771 738
1. MIS recurring revenue is typically billed annually and recognized ratably over 12 months. Recurring revenue can also be billed upfront and recognized over the life of the security.2. Rated by Moody’s Investors Service.3. New mandates estimate as of April 24, 2019.
1,046~900
3
4 Moody’s Investors Service
May 8, 2019 28
39%
61%
Recurring Transaction
1Q 2019 TTM Revenue: $2.7 billion
Public, Project, &
Infrastructure Finance
15%
Financial Institutions
16%
CorporateFinance
51%
StructuredFinance
17%
MIS Other 1%
60%
40%
U.S. Non-U.S.
» 39% recurring revenue
» 58% recurring revenue
» 37% recurring revenue
Full Year 2019 Revenue Guidance as of April 24, 2019
Global • increase in the low-single-digit % range
U.S. • increase in the low-single-digit % range
Non-U.S. • approximately flat
Adjusted Operating Margin • approximately 58%
» 32% recurring revenue
Moody’s Investors Service Financial Profile
Note: The revenue reclassification of REITs from Corporate Finance to Structured Finance is reflected in the trailing twelve month (TTM) calculations.
May 8, 2019 29
WIDER ACCESS TO CAPITAL INCREASED MARKET STABILITY
PLANNING & BUDGETING
TRANSPARENCY AND CREDIT COMPARISON
TANGIBLE FINANCING BENEFITS
RESPONSIVE TO INVESTOR DEMAND
Investors seek our opinions and
particularly value the knowledge of our
analysts and the depth of our research
The Benefits of a Moody’s Rating
May 8, 2019 30
Illustrative Value of a Moody’s Rating
Example: 10 year $500 million corporate bond
$15 million in total interest expensevs.
lifetime cost of a rating
$500,000,000x 4.3%
= $21,500,000x 10 years
= $215,000,000
Unrated Rated by Moody’s$500,000,000
x 4.0%= $20,000,000
x 10 years= $200,000,000
BondInterest rate
Annual interest paymentsTenor
Lifetime interest expense
Note: Illustrative spread differential based on feedback from syndicate desks and FBR & Co. research on Moody’s Corporation (January 2014) which stated that obtaining a Moody’s rating typically saves approximately 30 basis points per year for investment grade issuers. Many factors go into the pricing of a bond.
May 8, 2019 31
Americas APACEMEA
» 30,400+ rated companies and structured deals
» $34+ trillion total debt rated
» 18,600 research publications
» Offices in 10 cities*
» 4,700+ rated companies and structured deals
» $21+ trillion total debt rated
» 6,700 research publications
» Offices in 13 cities*
» 2,100+ rated companies and structured deals
» $14+ trillion total debt rated
» 3,500 research publications
» Offices in 10 cities*
Broad Coverage Serves Global Needs
1. Institutional Investor Survey.Source: Moody’s Investors Service. All data as of January, 28 2019 excluding: Research Data covers the period January 1, 2018 – December 31, 2018.All numbers are rounded other than those marked *
~15 Years Lead/Senior Analyst
tenure
#1 U.S. Credit Rating Agency
2012-20181
May 8, 2019 32
Continue to Invest in Key International Markets
Asia Pacific» China:
- Successful joint venture with CCXI, leading domestic rating agency
- Cross border market rated via MIS Hong Kong office
» South Korea: Full ownership of KIS subsidiary, a leading provider of domestic credit ratings in South Korea
» India: Increased to majority stake in ICRA to serve growing domestic Indian bond market
Latin America» Minority investments in Peru (Equilibrium) and
Chile (ICR) deepen Moody’s presence in dynamic and expanding markets
EMEA» Recently opened Moody’s offices in
Stockholm, Saudi Arabia and Lithuania
2008 2018
Emerging Asia Latin America Middle East
CEE/CIS Africa
Revenue in Emerging Markets
$84M
$313M
EMEA
May 8, 2019 33
~ 200
05101520253035404550556065707580859095100105110115120125130135140145150155160165170175180185190195200205210
Moody's Vigeo Eiris
Analysis» 2019 global green bond issuance forecast of $200
billion, a projected increase of 20% over 20181
» Moody’s Green Bond Assessment (“GBA”) portfolio is expected to save an estimated 2.6 million metric tons of annual carbon emissions2
» April 2019 majority acquisition of Vigeo Eirissignificantly increased Moody’s presence in Green Bond Assessments
Outreach» Participated in 65 global events in 2018 to
elevate Moody’s voice in ESG sphere as a thought leader
» Collaborate with key organizations and influencers in the market
Research» In 2018, published over 200 MIS research
reports focused on ESG risks and opportunities, up ~170% from 2017
Moody’s Investors Service ESG InitiativesThree Primary Objectives
10
18 21
05
10152025
2016 2017 2018
1. Forecast as of January 31, 2019.2. Based on preliminary 2018 data. Sources: Climate Bonds Initiative, Moody's Investors Service.3. Year-to-date as of April 30, 2019. Includes more than 50 Moody’s and 150 Vigeo Eiris GBAs.
3Annual Moody’s
AssessmentsTotal Combined Assessments
May 8, 2019 34
Acquired a Majority Stake in Vigeo Eiris, a Global Leader in ESG Research, Data and Assessments
E S G D ATA & R E S E AR C H
E S G I N D I C E S
G R E E N & S O C I AL B O N D AS S E S M E N T S
C O R P O R AT E E S G AS S E S S M E N T S
Collects ESG data and scores on over 4,500+ companies and provides 150+ Green Bond Assessments
Partners to provide ESG indices supporting index funds, ETFs and structured products
Will operate as an affiliate of MIS, offering ESG related non-credit assessments
Growth opportunity enhanced by leveraging Moody’s scale and brand
5 Moody’s Analytics
May 8, 2019 36
Research, Data and Analytics
65%
Enterprise Risk Solutions
26%
Professional Services
9%
Moody’s Analytics Financial Profile
84%
16%
Recurring Transaction
42%
58%
U.S. Non-U.S.» 99% recurring revenue» ~ 96% retention rate1
» 78% recurring revenue
» Combination of one-off contracts and semi-recurring revenue
Full Year 2019 Revenue Guidance as of April 24, 2019
Global • increase in the low-double-digit % range
U.S. • increase in the mid-teens-digit % range
Non-U.S. • increase in the high-single-digit % range
Adjusted Operating Margin • 29% - 30%
1Q 2019 TTM Revenue: $1.8 billion
1. Excludes Bureau van Dijk.Note: The revenue reclassification of the FACT product from RD&A to ERS is reflected in the trailing twelve month (TTM) calculations.
May 8, 2019 37
Moody’s Analytics has Several Platforms for Growth
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
$ M
illion
s
Moody’s Analytics
2018 Revenue: $1,730m
2008 – 2018 CAGR: +12%(~55% organic)
Professional Services
2018 Revenue: $159m
2008 – 2018 CAGR: +30% (~18% organic)
Enterprise Risk Solutions
2018 Revenue: $437m
2008 – 2018 CAGR: +14% (~66% organic)
Research, Data & Analytics
2018 Revenue: $1,134m
2008 – 2018 CAGR: +11%(~57% organic)
Revenue More Than Tripled Since Inception
Note: Individual line of business revenues may not add up to total Moody’s Analytics revenue due to rounding.
May 8, 2019 38
Expansion of ratings coverage
Production of insightful credit analysis
New customers in geographies with developing debt capital markets
Expansion of data sets and delivery options
Strong customer retention
RD&A: Subscription Growth Driven by Retention, Upgrades and Pricing & New Sales
Full
Year
201
8Fu
ll Ye
ar 2
016
95.4% 110.2%8.0% 6.8%
Retained Base Upgrades and Price New Sales Business Base
95.8% 109.7%9.1% 4.8%
Retained Base Upgrades and Price New Sales Business Base
Subscription Sales Growth(constant currency)
Full
Year
2017
95.5% 109.4%8.2% 5.7%
Retained Base Upgrades and Price New Sales Business Base
Note: The sales growth attributions presented on this slide are related to RD&A subscription sales on a constant currency basis and excludes Bureau van Dijk. Upgrades reflect amendments to existing customer contracts. New Sales reflect new contracts with new and existing customers.
May 8, 2019 39
ERS Revenue1: Recurring vs. Non-recurring
61%
78%
0%
20%
40%
60%
80%
100%
$0
$100
$200
$300
$400
2015 2016 2017 2018 TTM 1Q19
% R
ecurring
$ M
illion
s
One-Time Recurring % Recurring
Recurring Revenue CAGR2 = 16%
» ERS recurring revenue has grown by over $100 million since 2015
» Emphasis on subscription products supports scalability, drives operating leverage and margin
» Ease of use and lower cost of ownership shifting customer demand to SaaS
» Next gen products enhance customer experience, improve adoption rates and shorten sales cycles
» TTM3 sales as of 1Q19: Subscriptions (recurring) +12%; One-time (non-recurring) +2%1. Recurring revenue includes maintenance and subscription.2. Compound Annual Growth Rate, 2015-2018.3. Trailing twelve months ended March 31, 2019.
ERS: Driving Growth via Recurring Revenue
3
May 8, 2019 40
Global Regulatory and Accounting Drivers for the ERS Business
Source: Moody’s Analytics market research as of January 2019.
Note: MiFID II, MiFIR and GDPR regulations are relevant to the banking sector but do not impact on Moody’s Analytics products and so have not been included on the radar.
1. The implementation of the LCR in the EU was: 60% in 2015, 70% in 2016, 80% in 2017 and 100% in 2018. In the US, advanced-approach banks had to meet 80% of the LCR by January 1, 2015 and 100% of the ratio by January 1, 2017.
2. The G-SIB surcharge will expand the conservation buffer, subject to a 3 year phase in period. G-SIBs will be required to hold a minimum Total Loss-Absorbing Capacity” (TLAC) of at least 16% from 2019 and 18% by 2022.
EMEA
20182019202020212022 and beyond 2019 2020 2021 2022 and beyond
Leverage Ratio
BoE/ PRA ST
Revised Concentration Large Exposures
IFRS 9TLAC2NSFR
New securitization framework
IRRBB review
CVA review FRTB
Revised SA approach CR
Leverage Ratio
FRTB
BoE/ PRA ST
Revised Concentration & Large Exposures
IFRS 9TLAC2
NSFR
New securitization framework
IRRBB review
CVA review
Revised SA approach CR
ECB Anacredit
FBO ST
BoE/ PRA ST
CCAR /DFAST
Leverage Ratio
CCAR /DFAST
NSFR
FRTB
EU-wide ST Supplementary leverage ratio
Revised Concentration Large Exposures
IRRBB review
Revised SA approach CR
TLAC2 CVA review
SEC Liquidity rules (ETF, mutual funds)
NCUA RBC rule for large credit unions IFRS 9
CECL
LCR1
Vickers reform
Revised SA operational risk
Revised SA operational risk
Revised SA operational risk
Restrictions use internal models for CR RWA
Restrictions internal models for CR RWA
Restrictions use internal models for CR RWA
BoE/ PRA ST
BoE/ PRA ST
Updated Leverage Ratio
CCAR / DFAST
CCAR / DFAST
CCAR /DFAST
SCCL large BHCs & FBO
Revised minimum capital requirements for MR
Revised minimum capital requirements for MR
Revised minimum capital requirements for MR
Output floor
Output floor
Output floor
Supervisory rating system for LFIs
Revised G-SIB assessment and HLA requirement
Revised G-SIB assessment and HLA requirement
Revised G-SIB assessment and HLA requirement
SCCL for large banks
PSD II
May 8, 2019 41
» Generated $327M of revenue in 2018 at a 45% direct adjusted operating margin3
» On track for $45M of synergies by year-end 2019
– Includes real estate and duplicative data-set rationalization
» Cross-selling and joint product development underway
Diversified IP Network
310 Million Private Companies
76 Thousand Public Companies
218 Million Director Contacts
Bureau van Dijk Collects and Enhances Information to Deliver a Market Leading Global Dataset
1. Per May 15, 2017 presentation titled “Moody’s Acquisition of Bureau van Dijk”.2. Data as of April 26, 2019.3. Full year 2018 Bureau van Dijk results included approximately $17 million of revenue reductions relating to previous adjustments to deferred revenue recorded as part of acquisition accounting.
This revenue reduction reduced adjusted operating margin by 280 bps for the full year 2018. Full year 2018 revenue is as reported and has not been restated to reflect the FACT product reclassification.
Note: No longer disclosing standalone Bureau van Dijk after 4Q18 as an integrated line of business within RD&A.
RD&A Line of Business
Today2May 20171
Data from 160+ Information Providers
Publicly Available Data
Other Data Sourced By Bureau van Dijk
220 Million Private Companies
65 Thousand Public Companies
152 Million Director Contacts
May 8, 2019 42
Reis Accelerates MA’s Entry into CRE Data & Analytics
Banks, insurers and asset managers have substantial
exposures to commercial real estate
Powerful REIS data set, combined with MA capabilities and partnerships with other CRE specialists, enables Moody’s to set much needed standards in data and analytical practices
Highly fragmented ecosystem of information
sources & users
Complex analysis, including tenant credit quality, long-term forecasts of rental demand &
property supply
Developers Investors
Lenders
Brokers Service Providers
Note: MCO is a strategic investor in CompStak and Rockport Val.
RD&A Line of Business
6 Appendix
May 8, 2019 44
Corporate Finance: Revenue and Issuance
$113 $116 $124 $126 $134 $139 $135 $145 $128
$72 $85 $79 $66$87 $72 $55 $57 $97
$64 $63 $63 $64$58 $59
$39 $19$57
$104 $92 $85 $78$110 $121
$78 $70
$73
$0$50
$100$150$200$250$300$350$400
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ M
illio
ns
Revenue1: Mix by Quarter
Other Investment Grade Speculative Grade Bank Loans
$216 $275 $312 $363 $420 $421 $425 $488 $553$109$137
$197 $193$230 $305 $262
$301 $271
$143$120
$194$229
$219 $183 $181$254 $175
$96$120
$155$212
$242 $204 $254
$349 $380
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ M
illio
ns
Revenue1: Mix by Year
Other Investment Grade Speculative Grade Bank Loans
$348 $332 $322 $269 $312 $305 $236 $221$329
$123 $104 $99$100
$112 $94$64 $33
$105
$206$160 $138
$134$165 $210
$123$103
$100
$84$60
$44$59
$65 $72
$39$28
$26
$0
$200
$400
$600
$800
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ B
illio
ns
Issuance3: Mix by Quarter
Non-U.S. Speculative-Grade Bank LoansU.S. Speculative-Grade Bank LoansGlobal Non-Financial Speculative-Grade BondsGlobal Non-Financial Investment-Grade Bonds
$641 $750$1,125 $1,073 $1,043 $1,120 $1,192 $1,271 $1,074
$293 $250
$329 $411 $405 $329 $311 $426$304
$273 $330
$353 $504 $425 $354 $414$638
$601
$120 $247
$204
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ B
illio
ns
Issuance3: Mix by Year
Non-U.S. Speculative-Grade Bank LoansU.S. Speculative-Grade Bank LoansGlobal Non-Financial Speculative-Grade BondsGlobal Non-Financial Investment-Grade Bonds
2
2
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue. The revenue reclassification of REITs from Corporate Finance to Structured Finance is reflected starting from 1Q 2018.
2. Other includes: monitoring, commercial paper, medium term notes, and ICRA.3. Sources: Moody’s Analytics, Dealogic. U.S. and Non-U.S. Speculative-Grade Bank Loans represent only Moody’s rated speculative-grade bank loans. Non-U.S. Speculative-Grade Bank Loan
Origination data available starting 2016. Note: Debt issuance categories do not directly correspond to Moody’s revenue categorization.
May 8, 2019 45
38% 39% 38% 34% 34% 35% 44% 50%40% 36%
21% 27% 23%22% 22% 19%
18%19%
20% 27%
20%16%
16% 18% 15% 15%13%
7%13%
16%
22% 18% 23% 26% 28% 31% 26% 24% 28% 20%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Other Investment Grade Speculative Grade Bank Loans
70% 69% 68% 73% 73% 73% 65% 62% 69% 70%
30% 31% 32% 27% 27% 27% 35% 38% 31% 30%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Recurring vs. Transaction
Transaction Recurring
Corporate Finance: Revenue Diversification
38% 32% 32% 35% 34% 35% 37% 36% 35% 32%
62% 68% 68% 65% 66% 65% 63% 64% 65% 68%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Geography
Non - U.S. U.S.
Revenue1: Distribution by Product
2
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue. The revenue reclassification of REITs from Corporate Finance to Structured Finance is reflected starting from 1Q 2018.
2. Other includes: monitoring, commercial paper, medium term notes, and ICRA. Percentages have been rounded and may not total to 100%.
May 8, 2019 46
Structured Finance: Revenue and Issuance
$23 $24 $23 $27 $28 $28 $25 $26 $23
$20 $22 $22 $25 $24 $27 $24 $23 $24
$29 $30 $38$46
$21 $18$15 $24 $18
$27$42
$46$50
$43 $55$51
$48$35
$0
$1$1
$1
$1$1
$1$0
$1
$0
$20
$40
$60
$80
$100
$120
$140
$160
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ M
illio
ns
Revenue1: Mix by Quarter
ABS RMBS CREF Structured Credit Other
$91 $107 $110 $98 $92 $91 $94 $97 $106
$65$90 $85 $73 $76 $81 $85 $90 $98
$53$70 $95 $116 $122 $140 $133 $143 $78$82$78
$91 $96 $137 $135 $122$165
$196
$0$0
$0 $0$0 $2 $2
$2 $2
$0
$200
$400
$600
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ M
illio
ns
Revenue1: Mix by Year
ABS RMBS CREF Structured Credit Other
$220 $319 $335 $317 $319 $292 $298 $337 $384
$396$371 $231 $189 $238 $200 $204 $254 $270
$24$36
$73
$120 $114 $117 $94$120 $115
$59 $39 $65
$94$159
$132 $116$136
$200
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ B
illio
ns
Issuance2: Mix by Year
ABS RMBS CREF Structured Credit
$74 $88 $67$107 $102 $89 $79
$115$64
$47$75
$59
$73 $62 $74 $64
$70
$48
$18
$26$34
$41$26 $27
$26
$36
$16
$14
$32$42
$48$36 $64
$51
$49
$20
$0
$50
$100
$150
$200
$250
$300
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ B
illio
ns
Issuance2: Mix by Quarter
ABS RMBS CREF Structured Credit
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue. The revenue reclassification of REITs from Corporate Finance to Structured Finance is reflected starting from 1Q 2018.
2. Percentages have been rounded and may not total to 100%.Notes: ABS (Asset Backed Securitization) includes asset-backed commercial paper and long-term asset-backed securities. RMBS (Residential Mortgage Backed Securitization) includes covered bonds. CREF (Commercial Real Estate Finance) includes commercial mortgage-backed securities, real estate finance, commercial real estate CDOs, and real estate investment trusts (REITs). Structured Credit includes CLOs and CDOs.
May 8, 2019 47
Structured Finance: Revenue Diversification
62% 64% 62% 65% 63% 67% 64% 63% 64% 57%
38% 36% 38% 35% 37% 33% 36% 37% 36% 43%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Recurring vs. Transaction
Transaction Recurring
34% 31% 33% 31% 37% 37% 38% 37% 37% 38%
66% 69% 67% 69% 63% 63% 62% 63% 63% 62%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Geography
Non - U.S. U.S.
22% 20% 19% 24% 22% 22% 21% 22% 23%
18% 18% 18%21% 21% 21% 19% 20% 23%
28% 31% 29% 18% 14% 13% 20% 16%18%
32% 31% 33% 37% 43% 44% 39% 41% 35%
0% 0% 0% 1% 1% 0% 0% 0% 1%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
ABS RMBS CREF Structured Credit Other
Revenue1: Distribution by Product
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue. The revenue reclassification of REITs from Corporate Finance to Structured Finance is reflected starting from 1Q 2018.
2. Percentages have been rounded and may not total to 100%.Notes: ABS (Asset Backed Securitization) includes asset-backed commercial paper and long-term asset-backed securities. RMBS (Residential Mortgage Backed Securitization) includes covered bonds. CREF (Commercial Real Estate Finance) includes commercial mortgage-backed securities, real estate finance, commercial real estate CDOs, and real estate investment trusts (REITs). Structured Credit includes CLOs and CDOs.
May 8, 2019 48
Financial Institutions: Revenue and Issuance
$79 $70 $70 $80 $77 $77 $73 $63$80
$25$23 $24
$30 $28 $33 $38
$15
$29$5
$6 $5$6 $6 $7 $6
$6
$4$3
$3 $4$3 $3 $3 $3
$3
$3
$0
$20
$40
$60
$80
$100
$120
$140
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ M
illio
ns
Revenue1: Mix by Quarter
Banking Insurance Managed Investments Other
$192 $205 $228 $234 $242 $244 $240$300 $290
$69 $73$79 $89 $92 $96 $102
$102 $114
$18 $17$19 $16 $19 $16 $17
$22 $24
$0 $0$0 $0 $2 $9 $10
$13 $13
$0$50
$100$150$200$250$300$350$400$450$500
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ M
illio
ns
Revenue1: Mix by Year
Banking Insurance Managed Investments Other
$1,340 $1,266 $1,312$1,072 $1,247 $1,194 $1,187 $1,232 $1,248
$87 $79 $137$161
$197 $136 $112 $183 $74
$0
$400
$800
$1,200
$1,600
$2,000
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ B
illio
ns
Issuance2: Mix by Year
Global Speculative Grade Financial Corporate BondsGlobal Investment Grade Financial Corporate Bonds
$419$294 $278 $241
$411$339 $327
$170
$396
$45
$49 $39$49
$26$24 $20
$4
$29
$0
$100
$200
$300
$400
$500
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ B
illio
ns
Issuance2: Mix by Quarter
Global Speculative Grade Financial Corporate BondsGlobal Investment Grade Financial Corporate Bonds
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue. 2. Sources: Moody’s Analytics, Dealogic. Note: Debt issuance categories do not directly correspond to Moody’s revenue categorization.
May 8, 2019 49
Financial Institutions: Revenue Diversification
35% 37% 37% 45% 44% 47% 47%28%
42% 41%
65% 63% 63% 55% 56% 53% 53%72%
58% 59%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Recurring vs. Transaction
Transaction Recurring
60% 57% 57% 57% 58% 55% 50%63% 56% 60%
40% 43% 43% 43% 42% 45% 50%37% 44% 40%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Geography
Non - U.S. U.S.
68% 67% 65% 69% 67% 64% 61%72% 66% 69%
26% 26% 28% 23% 25% 27% 32%17% 26% 25%
5% 4% 5% 5% 5% 6% 5% 7% 5% 3%1% 3% 3% 3% 3% 3% 3% 4% 3% 3%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Banking Insurance Managed Investments Other
Revenue1: Distribution by Product
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue.Percentages have been rounded and may not total to 100%.
May 8, 2019 50
$159 $156 $181 $174 $177 $202 $225 $218 $185
$113 $121$142 $167 $181
$174$188 $213
$206$0 $0$0 $0 $0 $0
$0 $0$0
$0$50
$100$150$200$250$300$350$400$450$500
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ M
illio
ns
Revenue1: Mix by Year
Public Finance and SovereignProject & Infrastructure FinanceOther
$374 $248 $313 $302 $307 $364 $408 $384
$292
$207 $266
$220
$0$100$200$300$400$500$600$700$800$900
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ B
illio
ns
Issuance2: Mix by Year
Rated Global Project & Infrastructure Finance BondsLong-Term Rated U.S. Muni Bonds
Public, Project and Infrastructure: Revenue and Issuance
$82 $95 $80$127
$59 $82 $78 $74 $71
$57 $68 $75
$66
$57 $67 $57
$39 $54
$0
$50
$100
$150
$200
$250
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ B
illio
ns
Issuance2: Mix by Quarter
Rated Global Project & Infrastructure Finance BondsLong-Term Rated U.S. Muni Bonds
$53 $53 $49 $62$47 $52 $45 $41 $46
$45 $51 $60$57
$46$56
$54 $50 $47
$0 $0 $0$0
$0$0
$0$0 $0
$0
$20
$40
$60
$80
$100
$120
$140
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ M
illio
ns
Revenue1: Mix by Quarter
Public Finance and SovereignProject & Infrastructure FinanceOther
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue. 2. Global Rated Project & Infrastructure Finance available starting in 2016 and represents Moody’s rated issuance. Sources: Thomson SDC, Moody’s Corporation. Note: Debt issuance categories do not directly correspond to Moody’s revenue categorization.
May 8, 2019 51
58% 60% 63% 65% 58% 64% 61% 58% 61% 59%
42% 40% 37% 35% 42% 36% 39% 42% 39% 41%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Recurring vs. Transaction
Transaction Recurring
37% 35% 33% 38% 43% 43% 40% 40% 41% 35%
63% 65% 67% 62% 57% 57% 60% 60% 59% 65%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Geography
Non - U.S. U.S.
49% 54% 54% 51% 50% 48% 46% 45% 47% 50%
51% 46% 46% 49% 50% 52% 54% 55% 53% 50%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Public Finance and Sovereign Project & Infrastructure Finance Other
Revenue1: Distribution by Product
Public, Project and Infrastructure: Revenue Diversification
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue.Percentages have been rounded and may not total to 100%.
May 8, 2019 52
Moody’s Analytics: Financial Overview
$175 $181 $218 $258 $267 $276 $280 $297 $308
$96 $97$113
$143 $102 $110 $115 $124 $122
$36 $36$38
$40$38 $37 $40
$44 $42
$0
$100
$200
$300
$400
$500
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
$ M
illio
ns
Revenue1: Mix by Quarter
$419 $445 $483 $520 $572 $626 $668 $833$1,120$181 $196 $243 $263 $329 $374 $419
$449
$451
$19 $62 $108 $119$168 $150 $147
$149
$159
$0
$400
$800
$1,200
$1,600
$2,000
2010 2011 2012 2013 2014 2015 2016 2017 2018
$ M
illio
ns
Revenue1: Mix by Year
Professional ServicesEnterprise Risk SolutionsResearch, Data and Analytics
27% 26% 25% 22% 15% 16% 16% 17% 16% 15%
73% 74% 75% 78% 85% 84% 84% 83% 84% 85%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19Transaction Recurring
56% 54% 51% 55% 60% 59% 60% 58% 59% 57%
44% 46% 49% 45% 40% 41% 40% 42% 41% 43%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Geography
Non-U.S. U.S.
54% 54% 54% 58% 66% 65% 64% 64% 65% 65%
31% 33% 34% 31% 25% 26% 26% 27% 26% 26%16% 13% 12% 10% 9% 9% 9% 9% 9% 9%
0%
20%
40%
60%
80%
100%
FY14 FY15 FY16 FY17 1Q18 2Q18 3Q18 4Q18 FY18 1Q19
Revenue1: Distribution by Product
Revenue1: Distribution by Recurring vs. Transaction
1. Historical data has been adjusted to conform with current information and excludes intercompany revenue. Research, Data and Analytics includes Bureau van Dijk revenue beginning from the acquisition close date, August 10, 2017. The revenue reclassification of the FACT product from RD&A to ERS is reflected starting from 1Q 2018.
Percentages have been rounded and may not total to 100%.
May 8, 2019 53
Historically, Moody’s Revenue and Interest Rates Have Not Been Strongly Correlated
+200bps
+120bps
+100bps
+180bps
MCO Revenue and Interest Rates
5.8%
7.8%
4.7%
6.5%
2.3%
3.3%
1.8%
3.0% 2.7%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
$5,000
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
$ M
illion
s
MIS Revenue (L) MA Revenue (L) MCO Revenue (L) 10-yr U.S. Treasury Yield (R) 1
1. 10-yr U.S. Treasury Yields are represented by the rate at the end-of-period. Source: www.treasury.gov.
May 8, 2019 54
Baa-Credit Concentration Grows, with Mitigating Factors
$0.1
$1.9
Potential Fallen Angels
$ Trillions
$744
$2,0402.4x
3.0x
0.0x
1.0x
2.0x
3.0x
$0
$500
$1,000
$1,500
$2,000
$2,500
$ B
illio
ns
Face Value of Rated Debt Debt / EBITDA
0%
10%
20%
30%
40%
Aaa Aa A Baa Ba B Caa-C2007 2018
- 1.0 2.0 3.0 4.0 5.0 6.0
Rated Debt of Baa U.S. Nonfinancial Companies Has Almost Tripled Since 2007
2018 Baa-rated Debt Accounted for More than One-third of The Total Rated Debt of U.S. Nonfinancial Companies
2018 Potential Fallen Angels1 Accounted for $0.1 Trillion of the $2 Trillion of U.S. Baa-Rated Nonfinancial Debt Outstanding
Ratio of Potential Fallen Angels1 to Potential Rising Stars1
Declines Globally
1. Fallen Angels and Rising Stars fall within the “The Crossover Zone” which refers to the ratings closest to the line between speculative grade and investment grade. Companies in the zone are rated Baa3 or Ba1. To be considered in the zone, companies rated Baa3 must be on review for downgrade or have a negative outlook, while companies rated Ba1 must be on review for upgrade or have a positive outlook.
Source: Moody’s Investors Service.
» As compared to 2007, 2018 representative median companies generated more revenue ($4.7B to $7.1B), with improved EBITDA margins (20% to 24%) and EBITDA / Interest Expense ratios (7.0x to 8.2x)
May 8, 2019 55
$133
($31)
$101
$63
24.6%
28.1%
19.0$0
$100
$200
$300
1Q18 MAAdjustedOperating
Income
MARevenueIncrease
MAExpenseIncrease
1Q19 MAAdjustedOperating
Income
$ M
illio
ns
MA Adjusted Operating Income2MIS Adjusted Operating Income2
$0$100$200$300$400$500$600$700$800
1Q18 1Q19
$ M
illio
ns
MIS Revenue
CFG SFG FIG PPIF MIS Other
$720$670
$0
$100
$200
$300
$400
$500
1Q18 1Q19
$ M
illio
ns
MA Revenue
RD&A ERS PS
$407$472
$300.0$303.0$306.0$309.0$312.0$315.0$318.0$321.0$324.0$327.0$330.0$333.0$336.0$339.0$342.0$345.0$348.0$351.0$354.0$357.0$360.0$363.0$366.0$369.0$372.0$375.0$378.0$381.0$384.0$387.0$390.0$393.0$396.0$399.0$402.0$405.0$408.0$411.0$414.0$417.0$420.0$423.0$426.0$429.0$432.0$435.0$438.0$441.0$444.0$447.0$450.0$453.0$456.0$459.0$462.0$465.0$468.0$471.0$474.0$477.0$480.0$483.0$486.0$489.0$492.0$495.0$498.0$501.0$504.0$507.0$510.0$513.0$516.0$519.0$522.0$525.0$528.0$531.0$534.0$537.0$540.0$543.0$546.0$549.0$552.0$555.0$558.0$561.0$564.0$567.0$570.0$573.0$576.0$579.0$582.0$585.0$588.0$591.0$594.0$597.0$600.0$603.0$606.0$609.0$612.0$615.0$618.0$621.0$624.0$627.0$630.0$633.0$636.0$639.0$642.0$645.0$648.0$651.0$654.0$657.0$660.0$663.0$666.0$669.0$672.0$675.0$678.0$681.0$684.0$687.0$690.0$693.0$696.0$699.0$702.0$705.0$708.0$711.0$714.0$717.0$720.0$723.0$726.0$729.0$732.0$735.0$738.0$741.0$744.0$747.0$750.0$753.0$756.0$759.0$762.0$765.0$768.0$771.0$774.0$777.0$780.0$783.0$786.0$789.0$792.0$795.0$798.0$801.0$804.0$807.0$810.0$813.0$816.0$819.0$822.0$825.0$828.0$831.0$834.0$837.0$840.0$843.0$846.0$849.0$852.0$855.0$858.0$861.0$864.0$867.0$870.0$873.0$876.0$879.0$882.0$885.0$888.0$891.0$894.0$897.0$900.0$903.0$906.0$909.0$912.0$915.0$918.0$921.0$924.0$927.0$930.0$933.0$936.0$939.0$942.0$945.0$948.0$951.0$954.0$957.0$960.0$963.0$966.0$969.0$972.0$975.0$978.0$981.0$984.0$987.0$990.0$993.0$996.0$999.0$1,002.0$1,005.0$1,008.0$1,011.0$1,014.0$1,017.0$1,020.0$1,023.0$1,026.0$1,029.0$1,032.0$1,035.0$1,038.0$1,041.0$1,044.0$1,047.0$1,050.0$1,053.0$1,056.0$1,059.0$1,062.0$1,065.0$1,068.0$1,071.0$1,074.0$1,077.0$1,080.0$1,083.0$1,086.0$1,089.0$1,092.0$1,095.0$1,098.0$1,101.0$1,104.0$1,107.0$1,110.0$1,113.0$1,116.0$1,119.0$1,122.0$1,125.0$1,128.0$1,131.0$1,134.0$1,137.0$1,140.0$1,143.0$1,146.0$1,149.0$1,152.0$1,155.0$1,158.0$1,161.0$1,164.0$1,167.0$1,170.0$1,173.0$1,176.0$1,179.0$1,182.0$1,185.0$1,188.0$1,191.0$1,194.0$1,197.0$1,200.0$1,203.0$1,206.0$1,209.0
1Q18 1Q19
$ Tr
illio
ns
Global Debt Issuance1
$1.4$1.2
Business Model Resilient to Issuance Headwinds
1. Excludes Sovereign.2. These metrics are adjusted measures. See appendix for reconciliations from adjusted financial measures to U.S. GAAP.3. Includes intercompany revenue and expenses.
$ 386
$ 439 $ (47)
$ (6)
58.6%54.9%
30.0%
35.0%
40.0%
45.0%
50.0%
55.0%
60.0%
$350
$400
$450
1Q18 MISAdjustedOperating
Income
MISRevenueDecrease
MISExpenseIncrease
1Q19 MISAdjustedOperating
Income
$ M
illio
ns
-370bps
3 3 3 3
$1,127 $1,142
$0.0$3.0$6.0$9.0$12.0$15.0$18.0$21.0$24.0$27.0$30.0$33.0$36.0$39.0$42.0$45.0$48.0$51.0$54.0$57.0$60.0$63.0$66.0$69.0$72.0$75.0$78.0$81.0$84.0$87.0$90.0$93.0$96.0$99.0$102.0$105.0$108.0$111.0$114.0$117.0$120.0$123.0$126.0$129.0$132.0$135.0$138.0$141.0$144.0$147.0$150.0$153.0$156.0$159.0$162.0$165.0$168.0$171.0$174.0$177.0$180.0$183.0$186.0$189.0$192.0$195.0$198.0$201.0$204.0$207.0$210.0$213.0$216.0$219.0$222.0$225.0$228.0$231.0$234.0$237.0$240.0$243.0$246.0$249.0$252.0$255.0$258.0$261.0$264.0$267.0$270.0$273.0$276.0$279.0$282.0$285.0$288.0$291.0$294.0$297.0$300.0$303.0$306.0$309.0$312.0$315.0$318.0$321.0$324.0$327.0$330.0$333.0$336.0$339.0$342.0$345.0$348.0$351.0$354.0$357.0$360.0$363.0$366.0$369.0$372.0$375.0$378.0$381.0$384.0$387.0$390.0$393.0$396.0$399.0$402.0$405.0$408.0$411.0$414.0$417.0$420.0$423.0$426.0$429.0$432.0$435.0$438.0$441.0$444.0$447.0$450.0$453.0$456.0$459.0$462.0$465.0$468.0$471.0$474.0$477.0$480.0$483.0$486.0$489.0$492.0$495.0$498.0$501.0$504.0$507.0$510.0$513.0$516.0$519.0$522.0$525.0$528.0$531.0$534.0$537.0$540.0$543.0$546.0$549.0$552.0$555.0$558.0$561.0$564.0$567.0$570.0$573.0$576.0$579.0$582.0$585.0$588.0$591.0$594.0$597.0$600.0$603.0$606.0$609.0$612.0$615.0$618.0$621.0$624.0$627.0$630.0$633.0$636.0$639.0$642.0$645.0$648.0$651.0$654.0$657.0$660.0$663.0$666.0$669.0$672.0$675.0$678.0$681.0$684.0$687.0$690.0$693.0$696.0$699.0$702.0$705.0$708.0$711.0$714.0$717.0$720.0$723.0$726.0$729.0$732.0$735.0$738.0$741.0$744.0$747.0$750.0$753.0$756.0$759.0$762.0$765.0$768.0$771.0$774.0$777.0$780.0$783.0$786.0$789.0$792.0$795.0$798.0$801.0$804.0$807.0$810.0$813.0$816.0$819.0$822.0$825.0$828.0$831.0$834.0$837.0$840.0$843.0$846.0$849.0$852.0$855.0$858.0$861.0$864.0$867.0$870.0$873.0$876.0$879.0$882.0$885.0$888.0$891.0$894.0$897.0$900.0$903.0$906.0$909.0$912.0$915.0$918.0$921.0$924.0$927.0$930.0$933.0$936.0$939.0$942.0$945.0$948.0$951.0$954.0$957.0$960.0$963.0$966.0$969.0$972.0$975.0$978.0$981.0$984.0$987.0$990.0$993.0$996.0$999.0$1,002.0$1,005.0$1,008.0$1,011.0$1,014.0$1,017.0$1,020.0$1,023.0$1,026.0$1,029.0$1,032.0$1,035.0$1,038.0$1,041.0$1,044.0$1,047.0$1,050.0$1,053.0$1,056.0$1,059.0$1,062.0$1,065.0$1,068.0$1,071.0$1,074.0$1,077.0$1,080.0$1,083.0$1,086.0$1,089.0$1,092.0$1,095.0$1,098.0$1,101.0$1,104.0$1,107.0$1,110.0$1,113.0$1,116.0$1,119.0$1,122.0$1,125.0$1,128.0$1,131.0$1,134.0$1,137.0$1,140.0$1,143.0$1,146.0$1,149.0$1,152.0$1,155.0$1,158.0$1,161.0$1,164.0$1,167.0$1,170.0$1,173.0$1,176.0$1,179.0$1,182.0$1,185.0$1,188.0$1,191.0$1,194.0$1,197.0$1,200.0$1,203.0$1,206.0$1,209.0$1,212.0$1,215.0$1,218.0$1,221.0$1,224.0$1,227.0$1,230.0$1,233.0$1,236.0$1,239.0$1,242.0$1,245.0$1,248.0$1,251.0$1,254.0$1,257.0$1,260.0$1,263.0$1,266.0$1,269.0$1,272.0$1,275.0$1,278.0$1,281.0$1,284.0$1,287.0$1,290.0$1,293.0$1,296.0$1,299.0$1,302.0$1,305.0$1,308.0$1,311.0$1,314.0$1,317.0$1,320.0$1,323.0$1,326.0$1,329.0$1,332.0$1,335.0$1,338.0$1,341.0$1,344.0$1,347.0$1,350.0$1,353.0$1,356.0$1,359.0$1,362.0$1,365.0$1,368.0$1,371.0$1,374.0$1,377.0$1,380.0$1,383.0$1,386.0$1,389.0$1,392.0$1,395.0$1,398.0$1,401.0$1,404.0$1,407.0$1,410.0$1,413.0$1,416.0$1,419.0$1,422.0$1,425.0$1,428.0$1,431.0$1,434.0$1,437.0$1,440.0$1,443.0$1,446.0$1,449.0$1,452.0$1,455.0$1,458.0$1,461.0$1,464.0$1,467.0$1,470.0$1,473.0$1,476.0$1,479.0$1,482.0$1,485.0$1,488.0$1,491.0$1,494.0$1,497.0$1,500.0
1Q18 1Q19
$ M
illio
ns
MCO Revenue1%
$2.02 $2.07
$1.00
1Q18 1Q19
MCO Adjusted Diluted EPS2
2% +350bps
May 8, 2019 56
» ML and deep learning tools to automate financial data spreading at both MA and MIS
» AI and NLP used to generate credit reports on 6,000 municipal issuers
» RPA of manual, repeatable tasks within MIS
» Incorporating alternative data sources to augment SME credit scoring accuracy
» QuantCube pilot program to synthesize unstructured data to enhance financial analysis
» CompStak’s use of crowd-sourced data on CRE leases and sales
» NLP based early warning and monitoring tools for MIS analysts and MA customers
» AI tailored credit training for MA customers – Credit Coach
» Faster loan approvals with AIpowered lending decisions –CreditLens
» SaaS accelerating product development and improving customer experience
» Leveraging PaaS to experiment with application of tools and techniques --blockchain and big data
» Moody’s IT moving to IaaS to expand capabilities and lower costs
EnhanceData & Analytics
Deliver Efficiencies
Improve Decisions
IncreaseAdaptability
Note: AI: Aritificial Intelligence; ML: Machine learning; NLP: Natural language processing; RPA: Robotic process automation; IaaS: Infrastructure-as-a-service; SaaS: Software-as-a-service; PaaS: Platform-as-a-service.
Technology: Innovating with PurposeNext Gen Tech is a Defining Element of our Culture, Setting Stage for Growth
May 8, 2019 57
Moody’s Global Presence
U.S. employees non-U.S. employees total employees2
U.S. employees non-U.S. employees total employees1
3,984 9,253 13,237
2019
3,589 8,445 12,034
2018
AmericasArgentina MexicoBrazil PanamaCanada PeruCosta Rica United States
Europe, Middle East & AfricaAustria PolandBelgium PortugalCyprus RussiaCzech Republic Saudi ArabiaDenmark SlovakiaFrance South AfricaGermany SpainIsrael SwedenItaly SwitzerlandLithuania UAEMauritius United KingdomNetherlands
Asia-PacificAustralia MalaysiaChina NepalHong Kong SingaporeIndia Sri LankaJapan ThailandKorea
1. As of March 31, 2019.2. As of March 31, 2018.
May 8, 2019 58
CSR: Igniting Global OpportunityNewly Published 2018 CSR Report Details Accomplishments
Read more at moodys.com/csr
Empowering people with financial knowledgeExposing the financial roots of modern slaveryIn 2018, Bureau van Dijk, a Moody’s Analytics company, lent its Orbis database and technology to Liberty Shared, a nonprofit dedicated to preventing forced labor and other forms of human trafficking.
Helping young people reach their potentialThe diverse coders of tomorrowLast year, we launched the Queer Coders program with longtime partner the Hetrick-Martin Institute to help teach LGBTQI youth job-ready coding skills while offering critical wraparound counseling and mentorship services.
Activating an environmentally sustainable futureBringing our ESG approach into focus for stakeholdersWe continued to share insights and educate people about our approach to ESG evaluation in 2018 at numerous events and by expanding our research in new directions.
May 8, 2019 59
Reconciliation of Adjusted Financial Measures to GAAPAdjusted Operating Income and Adjusted Operating Margin Reconciliation1
(in $ millions) 2014 2015 2016 2017 2018 TTM 1Q19Operating Income $1,449.8 $1,490.7 $650.9 $1,820.8 $1,868.2 $1,839.1Operating Margin 43.5% 42.8% 18.1% 43.3% 42.1% 41.3%
Add Adjustment:Depreciation & Amortization 95.6 113.5 126.7 158.3 191.9 193.1Acquisition-Related Expenses - - - 22.5 8.3 8.9Restructuring - - 12.0 - 48.7 54.2Settlement Charge - - 863.8 - - -
Adjusted Operating Income $1,545.4 $1,604.2 $1,653.4 $2,001.6 $2,117.1 $2,095.3Adjusted Operating Margin 46.3% 46.0% 45.9% 47.6% 47.7% 47.0%
Moody's Corporation Net Debt Reconciliation
1. 2014 - 2017 operating and adjusted operating income have been restated to conform to the new presentation of pension accounting.
(in $ millions) 2014 2015 2016 2017 2018 1Q19Gross debt $2,532.1 $3,380.6 $3,363.0 $5,540.5 $5,676.0 $5,547.4Less: Cash, cash equivalents and short-term investments 1,677.6 2,232.2 2,224.9 1,183.3 1,817.5 1,310.6
Net debt $854.5 $1,148.4 $1,138.1 $4,357.2 $3,858.5 $4,236.8
May 8, 2019 60
Reconciliation of Adjusted Financial Measures to GAAP (cont.)Moody's Corporation Operating Margin Guidance Reconciliation
2019F1
Projected Operating Margin - GAAP Approximately 43%Projected impact from Depreciation & Amortization Approximately 4%Restructuring Approximately 1%Projected impact from Acquisition-Related Expenses NegligibleProjected Adjusted Operating Margin Approximately 48%
Free Cash Flow Reconciliation2
(in $ millions) 2014 2015 2016 2017 2018 2019F1
Net cash flows from operating activities $1,077.3 $1,198.1 $1,259.2 $754.6 $1,461.1 $1,700.0 - $1,800.0
Less: Capital expenditures 74.6 89.0 115.2 90.6 $90.4 ~$100Free Cash Flow $1002.7 $1,109.1 $1,144.0 $664.0 $1,370.7 $1,600.0 to $1,700.0
1. Guidance as of April 24, 2019. 2. In 2017, the Company adopted ASU 2016-09 “Improvements to Employee Share-Based Payment Accounting” on a retrospective basis. In Q1 2018, the Company adopted ASU No. 2016-
15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a Consensus of the Emerging Issues Task Force)” on a retrospective basis.
May 8, 2019 61
Reconciliation of Adjusted Financial Measures to GAAP (cont.)Moody's Corporation Diluted EPS Reconciliation
2014 2015 2016 2017 2018 2019F1
Diluted EPS - GAAP $4.61 $4.63 $1.36 $5.15 $6.74 $7.30 - $7.55
Legacy Tax (0.03) (0.03) - - - -Impact of Litigation Settlement - - $3.59 - - -ICRA Gain (0.37) - - - - -FX Gain due to Subsidiary Liquidation - - ($0.18) - - -Restructuring - - $0.04 - $0.19 ~$0.10
CCXI Gain - - - ($0.31) - -Acquisition-Related Expenses - - - $0.10 $0.03 ~$0.05
Purchase Price Hedge Gain - - - ($0.37) - -Net Acquisition-Related Intangible Amortization Expenses $0.10 $0.11 $0.13 $0.23 $0.40 ~$0.40
Impact of U.S. tax reform - - - $1.28 ($0.30) -Net Impact of U.S./European tax change on deferred taxes - - - ($0.01) - -Increase to non-U.S. UTPs - - - - $0.33 -Adjusted Diluted EPS $4.31 $4.71 $4.94 $6.07 $7.39 $7.85 - $8.10
1. Guidance as of April 24, 2019.Note: Table may not sum to total due to rounding.
May 8, 2019 63
© 2019 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.
CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.
MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.
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CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.
All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.
To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.
To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.
NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.
Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”
Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.
Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.
MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY250,000,000.
MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.