Experian 2009 Annual Report Download - page 8

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6Experian Annual Report 2009
Growth drivers
Experian has many growth
opportunities and investing for future
growth is a cornerstone of its strategy.
Despite marketplace challenges
caused by the global recession, the
Group has continued to deliver strong
nancial performances due to the
exibility and diversity of its business
model.
Credit-related activities
In the short term, Experian is a
beneciary of increased demand for
its countercyclical products, which
help lenders calculate and preserve
capital and manage loan portfolio risk.
In the medium term, growth prospects
for Experian’s credit-related activities
are underpinned by a number of
factors: global demand for consumer
and business credit; increasing
demand for analytics that help
institutions and consumers to predict
and manage lending risk and prevent
fraud; standardisation in technology
platforms amongst global nancial
services clients; and growth in
demand for Experian’s products from
outside the nancial services industry,
including telecommunications,
utilities, public sector and the US
healthcare payments sector.
Marketing-related activities
New communication channels
are driving growth in Experian’s
marketing-related activities. There is
a growing requirement from around
the world for marketing campaigns
that can be targeted more precisely,
executed more quickly, coordinated
across multiple channels and
delivered with a measurable return
on investment. This is stimulating
increased demand for the type of
expertise, data and sophisticated
software and analytical tools in which
Experian has invested.
Strategy
In order to capitalise on the market
opportunities available to Experian
and to drive long-term shareholder
value, the Group has centred its
strategy on three elements:
1. Focus on data and analytics
Experian’s core expertise lies in
the ownership and operation of
comprehensive databases about
consumers and businesses. From
these it is able to extract signicant
extra value by applying its own
proprietary analytics and software.
This combination of data and
analytics is a key differentiator.
Experian’s principal business lines
are characterised by their market-
leading positions, high barriers to
entry, global reach and potential for
long-term growth, as well as their
attractive nancial characteristics.
The Group is therefore focusing
its investment on developing these
core capabilities in order to build
market-leading positions in credit
risk management and targeted
marketing. It is also taking advantage
of synergies across its credit and
marketing activities, where it can
leverage a signicant number of data
management processes to serve
clients in both areas.
2. Drive protable growth
Experian has excellent positions in
its two end-markets of credit and
marketing and its aim is to drive
organic revenue growth by leveraging
its scale and focusing on ‘best-in-
class’ performance.
The Group’s strategic framework
for driving protable growth has the
following components:
- Increase global reach: by expanding
its global network and extending
its existing capabilities into new
geographic and vertical markets.
- Innovate to stay ahead: by
promoting its culture of innovation
and investing in new data sources
and enhanced analytics to deliver
signicant value to clients.
- Drive operational excellence: by
leveraging its global scale and
common platforms to allow it to
deploy global products quickly into
new markets.
3. Optimise capital efciency
Experian is committed to maintaining
a prudent, exible and efcient
balance sheet. The Group aims to
use its strong cash ow to reinvest
in the business to retain competitive
advantage and to make targeted
acquisitions that t its strategy and
meet its nancial hurdles. As credit
ratios improve, Experian will evaluate
additional opportunities for returning
surplus cash to shareholders via
dividends or share repurchases.
Revenue by activity 1
Decision Analytics
Credit Services
Marketing Services
Interactive
1 Excludes discontinuing
activities
Revenue by geography 1
Latin America
North America
UK and Ireland
EMEA/Asia Pacic
1 Excludes discontinuing
activities
Business and market overview continued
Introduction