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Nielsen Reports 2nd Quarter 2015 Results

NEW YORK--(BUSINESS WIRE)--

Nielsen N.V. (NLSN) today announced second quarter 2015 results. Revenues were $1,559 million for the second quarter of 2015, down 2.2% due to the impact of foreign exchange, but up 4.8% on a constant currency basis, compared to the second quarter of 2014.

“Nielsen’s second quarter was marked with notable accomplishments which fueled 4.8% constant currency revenue growth and margin expansion across both our Buy and Watch segments. We had new client wins in every region of the world in our Buy business, which grew 4.8% and had its fourth consecutive quarter of margin expansion, both on a constant currency basis. Our Watch segment grew 4.7% on a constant currency basis due to strength in both Audience Measurement and Marketing Effectiveness as we continue to link measurement and analytics to bring greater value to our clients. We have strong momentum around Total Audience Measurement with Digital Content Ratings progressing well towards its fall launch. And by year end, Digital Ad Ratings will be available in 16 markets, covering 95% of global digital advertising spending. We are also pleased with the ongoing integration of eXelate and are increasingly excited about its abilities to serve as the platform by which we can help clients improve the precision of marketing decisions,” said Mitch Barns, Chief Executive Officer of Nielsen.

Barns continued, “In addition to executing upon our key initiatives, unlocking incremental value for our shareholders also remains a priority. Our strong free cash flow generation helps us achieve this by enabling consistent investment within our own business alongside a growing dividend and a robust share repurchase program.”

Adjusted EBITDA for the second quarter increased 1.7% to $468 million, or 7.3% on a constant currency basis compared to the second quarter of 2014. As a percentage of revenues, adjusted EBITDA grew 116 basis points, or 72 basis points on a constant currency basis, due to the accretive impact of our investments in coverage and analytics capabilities and the benefit of our ongoing productivity initiatives.

Income from continuing operations for the second quarter increased 52.6% to $116 million, an increase of 103.5% on a constant currency basis, compared to the second quarter of 2014. The year over year increase is largely driven by fees associated with refinancing during the second quarter of 2014, which were not incurred in the second quarter of 2015, and the benefit of ongoing productivity initiatives. Income from continuing operations per share, on a diluted basis, was $0.31 compared to $0.19 in the second quarter of 2014.

Adjusted Net Income for the second quarter increased 2.5% to $246 million, or 10.3% on a constant currency basis, compared to the second quarter of 2014. Adjusted Net Income per share on a diluted basis was $0.66 compared to $0.62 in the second quarter of 2014.

Revenues within the Buy segment decreased 5.3%, or increased 4.8% on a constant currency basis, to $852 million. Excluding the impact of foreign currency, Buy emerging markets revenue grew 9.3% due to the ongoing demand for our services and growth within both our multinational and local client bases. Revenues in the developed markets grew 2.8% on a constant currency basis.

Revenues within the Watch segment increased 1.9%, or 4.7% on a constant currency basis, to $707 million. The growth was driven by continued strength in Audience Measurement and Marketing Effectiveness, which grew 5.1% and 21.7%, respectively, on a constant currency basis.

Financial Position

As of June 30, 2015, cash balances were $331 million and gross debt was $7,473 million. Net debt (gross debt less cash and cash equivalents) was $7,142 million and our net debt leverage ratio was 3.86x at the end of the quarter. Capital expenditures were $97 million for the second quarter of 2015 as compared to $94 million for the second quarter of 2014.

Free cash flow for the second quarter of 2015 increased to $154 million from $116 million in the second quarter of 2014. Cash flow from operations increased to $251 million in 2015 from $210 million in the second quarter of 2014. The increase in free cash flow and cash flow from operations was due to the stronger operating performance discussed above.

In April 2015 and June 2015, secondary public offerings totaling 29 million shares of our common stock were completed on behalf of certain selling stockholders, primarily comprised of the Sponsor group. All proceeds went to the selling stockholders and the offering did not have a significant impact on our operating results or financial position. At June 30, 2015, the one remaining sponsor held 2.0% of our common stock.

Capital Allocation

The company repurchased $179 million of its stock during the second quarter of 2015 which brings the year to date total to $320 million. The Company has a total of $703 million remaining for repurchase under the existing share repurchase program, which it anticipates utilizing by mid-2016.

As announced on July 23rd, the Board of Directors declared a quarterly cash dividend of $0.28 per common share. The dividend is payable on September 10, 2015 to stockholders of record at the close of business on August 27, 2015.

Other Matters

At the recent Annual Meeting of Shareholders on June 26, 2015, the merger between the Company and Nielsen Holdings plc was approved, which would relocate the place of incorporation from the Netherlands to England and Wales. The merger is expected to be completed during the third quarter of 2015.

Conference Call and Webcast

Nielsen will hold a conference call to discuss its second quarter 2015 results at 8:00 a.m. U.S...


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