On July 31, 2024, Verisk Analytics Inc (VRSK, Financial) released its 8-K filing for the second quarter ended June 30, 2024. Verisk Analytics is the leading provider of statistical, actuarial, and underwriting data for the United States' property and casualty insurance industry. The company leverages a vast contributory database and proprietary data assets to develop analytical tools that help insurance providers better assess and price risk, achieve operational efficiency, and optimize claim settlement processes.
Performance Overview
Verisk Analytics Inc (VRSK, Financial) reported revenues of $717 million for Q2 2024, a 6.2% increase from $675 million in Q2 2023. However, this figure fell short of the analyst estimate of $722.40 million. The company's earnings per share (EPS) came in at $2.15, significantly surpassing the analyst estimate of $1.54. Adjusted EPS was $1.74, reflecting a 15.2% increase from $1.51 in the same period last year.
Key Financial Achievements
Verisk's subscription-based model and cost discipline were highlighted as key drivers of its financial performance. The company achieved a 6.0% organic constant currency (OCC) revenue growth and an 8.3% growth in subscription revenues. Adjusted EBITDA grew by 8.8% to $397 million, with an OCC growth of 8.5%. The company also reported a 50.7% increase in income from continuing operations, reaching $308 million.
Income Statement Highlights
| Metric | Q2 2024 | Q2 2023 | Change |
|---|---|---|---|
| Revenues | $717 million | $675 million | 6.2% |
| Income from Continuing Operations | $308 million | $204 million | 50.7% |
| Adjusted EBITDA | $397 million | $365 million | 8.8% |
| Diluted EPS | $2.15 | $1.41 | 52.5% |
| Adjusted EPS | $1.74 | $1.51 | 15.2% |
Cash Flow and Shareholder Returns
Net cash provided by operating activities was $212 million for Q2 2024, up 9.7% from $193 million in Q2 2023. Free cash flow increased by 14.3% to $154 million. The company also returned capital to shareholders through dividends and share repurchases. A cash dividend of 39 cents per share was paid on June 28, 2024, and another dividend of the same amount is scheduled for September 30, 2024. Additionally, Verisk completed a $150 million Accelerated Share Repurchase program, repurchasing 552,406 shares at an average price of $271.54.
Commentary from Leadership
Lee Shavel, president and CEO, Verisk: "Our second quarter financial results reflect the strength of our subscription-based model and cost discipline. In an increasingly dynamic environment, our clients have a growing appreciation for Verisk's ability to help them move faster and increase accuracy through intelligent automation. We remain energized about the opportunity ahead, our ability to capitalize on it and drive long-term value for our clients and shareholders alike."
Elizabeth Mann, CFO, Verisk: "Verisk delivered 6.0% OCC revenue growth, with 8.3% subscription growth, partially offset by a difficult comparison for the transactional revenues. Our strong operating leverage and cost discipline led to 8.5% OCC adjusted EBITDA growth and 15.2% adjusted EPS growth. We continue to invest our strong free cash flow in future growth opportunities while also returning capital to shareholders through dividends and repurchases."
Analysis
Verisk Analytics Inc (VRSK, Financial) demonstrated robust financial performance in Q2 2024, driven by its subscription-based model and stringent cost management. The company's ability to exceed EPS estimates while slightly missing revenue projections indicates strong operational efficiency and profitability. The significant growth in adjusted EBITDA and free cash flow further underscores Verisk's financial health and its commitment to shareholder returns through dividends and share repurchases.
For more detailed insights and the complete financial statements, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Verisk Analytics Inc for further details.
