Brazil boost for Experian

CREDIT reference agency Experian hiked its interim dividend and said it was continuing to look at ways of returning cash to shareholders after a stronger-than-expected first half of the year boosted by Latin America.

Earnings before interest and tax (Ebit) in the region jumped 36 per cent year-on-year to $115m (£72.3m) while revenue rose 22 per cent to $350m.

Chief executive, Don Robert, said Latin America was “incredibly important” to Experian’s growth. The company acquired about 70 per cent of Brazilian credit agency Serasa for roughly $1.5bn three years ago. Since then it has posted annual growth of between 15 and 22 per cent.

The firm reported that net profit in the six months to 30 September rose to $260m from $249m a year earlier. Revenue grew eight per cent at constant exchange rates and seven per cent on an organic basis, to $2bn from $1.87bn. Overall first half profit before tax rose 12 per cent to $450m. But pre-tax profit from continuing operations fell to $283m from $316m.

Experian proposed an interim dividend of $0.09 cents per ordinary share, up 29 per cent adding it would continue to look at ways to return surplus cash to shareholders.

In May it responded to pressure to unlock its cash reserves with a share buyback. It said yesterday it had bought back $147m shares under the $350m programme.

“For the year as a whole, we expect to deliver similar rates of organic revenue growth to the first half, and we are targeting modest improvement in our Ebit margin,” said Robert.

Investors welcomed the report with shares ending the day up 6.33 per cent, or 44.5p, at 748p.