RATING agency Moody’s Corporation reported an 8.7 per cent slide in profit yesterday, blaming increased expenditure on staff numbers and IT systems.
Net profits fell to $172.5m (£109.9m) at the end of June, down from $189m in the second quarter of 2011, with earnings per share hitting 76 cents, down from 82 cents last year.
The company blamed the drop on an “increased headcount,” following its acquisition of insurance analysis firm Barrie & Hibbert and statistical research firm Copal Partners in 2011.
This increased costs from $335.1m to $362.3m year on year – overshadowing a six per cent revenue increase of $35.6m for the same period.
“Moody’s revenue results for the second quarter reflected solid year-on-year growth in public finance and structured finance at Moody’s Investors Service as well as continued strong results from Moody’s Analytics,” chief executive Raymond McDaniel said.
Moody’s best performing division was its analytics business, which saw a 19 per cent revenue increase in the second quarter led by increased sales of research through its CreditView business.