Credit data firm Experian's upbeat forecast sends shares to record high
Shares up 8%, top FTSE 100
Company sees current full year revenue growth of 6-8%
Posts better-than-expected annual organic revenue growth
Adds share move in paragraph 2, CFO comments from interview and analyst comment in paragraphs 5, 7 and 10
By Aby Jose Koilparambil and Eva Mathews
May 15 (Reuters) -Experian EXPN.L forecast an upbeat current fiscal year on Wednesday, betting on growing demand for new products and reduced capital spending, as the credit data company inches closer to completing its technology transition to the cloud.
Shares of the FTSE 100 .FTSE company, which expects organic revenue growth of between 6% and 8% for fiscal year 2025, rose 8% to a record high of 3,771 pence, after having gained over 16% so far this year.
Experian has benefited from a rise in overall demand for credit reports from businesses and consumers, particularly in regions such as Latin America, but tighter lending conditions globally have impacted some of its business lines with more direct volume exposure.
Investment in technology cloud transformation will peak in the largest regions and will largely be completed over the next two years, the company said, which will bring down capital expenditure as a percentage of revenue to about 7% from around 9% over the medium term.
Finance chief Lloyd Pitchford said efforts over the last few years to offer an integrated platform for Experian's financial services clients had helped fuel growth, while strong demand for its digital wallet offering in North America and Brazil and auto insurance products was a "game-changer".
However, the company said it expected credit conditions to remain "reasonably subdued" in the current fiscal year.
"We're not expecting any broad based recovery in the current financial year, but we think as interest rate reduction starts to come through from central banks that will start to seep through maybe at the back end of this year," Pitchford said.
The company expects margin expansion in the range of 30-50 basis points at constant currency, for the current year.
The Dublin, Ireland-headquartered company said its organic revenue grew 6% in the full year ended March 31, at the top end of its expectations and beating analysts' consensus growth estimate of 5.5%.
"Experian is a leader in its field, with US operations taking centre stage and driving cash flow that can be reinvested into growth markets like Latin America," said Hargreaves Lansdown analyst Matt Britzman.
Reporting by Aby Jose Koilparambil and Eva Mathews in Bengaluru; Editing by Rashmi Aich and Emelia Sithole-Matarise
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