S&P Global (NYSE: SPGI) reported fourth quarter 2020 revenue of $1.87 billion, an increase of 8% compared to the same period in 2019 with growth in all four businesses.

Fourth quarter net income decreased 16% to $454 million and diluted earnings per share decreased 15% to $1.88 as the Company took a number of lease impairment and restructuring charges aimed at improving future financial performance. Adjusted net income for the fourth quarter increased 5% to $654 million due to revenue growth, productivity improvements, and a lower effective tax rate partially offset by increased investment spending.

Adjusted diluted earnings per share increased 7% to $2.71 benefiting from a 2% decrease in the average diluted shares outstanding.  Pre-tax adjustments in the fourth quarter of 2020 totaled $247 million primarily due to office lease and equipment impairments, and restructuring charges all intended to improve future financial performance.  Additional pre-tax adjustments included IHS Markit merger costs, deal-related amortization, and Kensho retention-related expenses.

For the full year, revenue increased 11% to $7.44 billion.  2020 net income increased 10% to $2.34 billion and diluted earnings per share increased 12% to $9.66.  2020 adjusted net income increased 20% to $2.83 billion and adjusted diluted earnings per share increased 23% to $11.69.

IHS Markit Merger Update:  The Company’s Form S-4 became effective January 22, 2021.  Both companies have established a record date of January 19, 2021 for the respective shareholder votes which will take place on March 11, 2021.  The Company is also seeking regulatory approval in several countries and that process is underway.

S&P Dow Jones Indices:

4th Quarter, 2020:  Revenue increased 10% to $257 million in the fourth quarter of 2020.  Revenue improved primarily due to increased asset-linked fees.  Average AUM in exchange-traded funds based on S&P DJI’s indices was $1.9 trillion in the quarter, an increase of 16% versus the fourth quarter of 2019.

2020: Revenue increased 8% to $989 million and operating profit increased 5% to $666 million.   Operating profit margin decreased 150 basis points to 67.4%.  Operating profit attributable to the Company increased 5% to $485 million.  Adjusted operating profit increased 7% to $684 million.  Adjusted operating profit margin decreased 40 basis points to 69.1%. Adjusted operating profit attributable to the Company increased 7% to $503 million.

Market Intelligence:

4th Quarter, 2020:  Reported revenue increased 8% to $542 million in the fourth quarter with growth in Data Management Solutions, Desktop, and Credit Risk Services.  Organic revenue grew 7%.  Operating profit decreased 11% to $120 million and operating profit margin declined 470 basis points to 22.2%, primarily due to restructuring expense.  Adjusted operating profit increased 2% to $166 million and adjusted operating profit margin decreased 160 basis points to 30.7%.

2020:  Revenue increased 8% to $2.11 billion and organic revenue increased 7%.  Operating profit increased 4% to $589 million and operating profit margin decreased 90 basis points to 28.0%.  Adjusted operating profit grew 9% to $683 million and adjusted operating profit margin improved 30 basis points to 32.4%.

Ratings:

4th Quarter, 2020: Revenue increased 7% to $881 million.  Organic revenue grew 5%.  Non-transaction revenue increased 15% to $451 million during the quarter due to increased activity associated with surveillance, frequent issuer programs, Rating Evaluation Service, and new entity ratings as well as revenue from the acquisitions of Greenwich Associates by CRISIL and the ESG Ratings Business from RobecoSAM.  Transaction revenue was relatively unchanged at $430 million in the fourth quarter as increases in bank loan ratings revenue were offset by a decrease in bond issuance compared to a very strong fourth quarter in 2019.

2020:  Revenue increased 16% to $3.61 billion and organic revenue increased 15% primarily due to increased global corporate bond issuance offset partially by lower structured finance bond issuance and bank loan rating revenue.  Operating profit increased 25% to $2.22 billion and operating profit margin improved 420 basis points to 61.6%.  Adjusted operating profit increased 25% to $2.25 billion compared to 2019 and adjusted operating profit margin improved 460 basis points to 62.4%.

Platts:

4th Quarter, 2020:  Reported revenue increased 5% to $223 million with growth in the core subscription business partially offset by decreased Global Trading Services activity.  Operating profit decreased 9% to $100 million and operating profit margin decreased 680 basis points to 44.8% primarily due to restructuring expense.  Adjusted operating profit increased 3% to $115 million and adjusted operating profit margin decreased 100 basis points to 51.7%.

2020:  Revenue increased 4% to $878 million and organic revenue increased 4%.  Operating profit was relatively unchanged at $458 million and operating profit margin decreased 200 basis points to 52.1%.  Adjusted operating profit increased 8% to $480 million and adjusted operating profit margin improved 230 basis points to 54.7%.

Source: S&P Global Earnings Report