(By Balaseshan) Information services company IHS Inc. (NYSE:IHS) reported a 10.6% increase in second quarter earnings, helped by solid top-line growth and margin expansion. Despite better-than-expected second quarter results, shares fell 3.44% in aftermarket.
Earnings for the second quarter were $44.19 million or $0.66 per share, up from $39.94 million or $0.61 per share last year. Adjusted earnings per share grew 17% to $0.97.
Revenue climbed 20% to $387 million, driven by 7% organic growth and 14% acquisitive growth, with foreign currency movements decreasing 1%.
Analysts had expected a profit of $0.94 per share on revenue of $383.53 million.
Subscription revenue increased to $287.25 million from $250.37 million, while non-subscription revenue rose to $99.91 million from $72.75 million.
The Americas segment revenue increased 18% to $230 million. The EMEA segment revenue grew 19% to $114 million. The APAC segment's revenue climbed 31% to $43 million.
Excluding a $57 million pension funding contribution, IHS generated $235 million of cash flow from operations during the six months ended May 31, 2012, representing a 17% increase over last year's $201 million.
Looking ahead into the fiscal 2012, the company narrowed its adjusted earnings guidance to range of $3.88 to $4.01 per share from previous forecast of $3.84 to $4.01 per share, while Street analysts predict $3.97 per share.
The company increased its all-in revenue outlook for fiscal 2012 to range of $1.53 billion to $1.58 billion from previous estimate range of $1.525 billion to $1.575 billion, while Street predicts $1.55 billion. Organic revenue growth rate is now expected to be between 7% to 10%.
The company also anticipates that depreciation and amortization expense to be about $119 million for fiscal 2012, which reflects the impact of recently completed acquisitions.
IHS closed Monday's regular trading up 1.40% at $105.84. The stock has been trading between $67.88 and $106.53 for the past 52 weeks.