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Moody's Q4 Profit Down 12.5%; Sees 2021 Profit In Line With View

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Moody's Corp. (MCO) Friday reported a profit for the fourth-quarter that declined 12.5 percent from last year. But quarterly revenue rose 5 percent.

Looking ahead for fiscal year 2021, the company expects earnings per share to be in the range of $9.70 - $10.10, and adjusted earnings per share of $10.30 - $10.70. Analysts expect annual earnings of $10.36 per share.

The company projects 2021 revenue growth in the mid-single-digit percent range with strong growth in Moody's Analytics offsetting expectations for a modest decline in global debt issuance.

The Full year 2021 guidance includes share repurchases of about $1.5 billion.
The company reported that its fourth-quarter net income attributable to the company declined 12.5 percent to $314 million from last year's $359 million, with earnings per share decreasing to $1.66 from $1.88 in the previous year.

Operating expenses were $846 million, up 16% from the prior-year period. Eleven percentage points of the increase were attributable to severance and restructuring charges associated with the exit of certain real estate and a strategic reorganization of Moody's Analytics, incentive compensation and sales commissions, as well as M&A related activities.

Adjusted net income for the fourth-quarter was $362 million or $1.91 per share compared to $381 million or $2.00 per share in the previous year. Analysts polled by Thomson Reuters expected the company to report earnings of $1.97 per share for the fourth-quarter. Analysts' estimates typically exclude special items.

Total revenue for the fourth-quarter was $1.29 billion, up 5 percent from $1.23 billion in the prior year. Foreign currency translation favorably impacted Moody's revenue by 2 percent. Analysts expected revenues of $1.23 billion for the fourth-quarter.

Revenue for Moody's Investors Service for the fourth quarter of 2020 was $735 million, up 2 percent from the prior-year period. Foreign currency translation favorably impacted MIS revenue by 2 percent.

Revenue for Moody's Analytics for the fourth quarter of 2020 was $555 million, up 8 percent from the prior-year period.

In Friday pre-market trade, MCO was trading at $280.00 up $1.34 or 0.48 percent.

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