Experian : Preliminary results for the year ended 31 Mar 2016

news release

Preliminary results for the year ended 31 March 2016

11 May 2016 ─Experian, the global information services company, today issues its full year financial results for the twelve months ended 31 March 2016.

General highlights

· Delivering on our strategy:

o improved growth momentum;

o strength in Credit Services and Decision Analytics;

o successfully repositioning North America Consumer Services;

o resilience in Brazil.

· Delivering on our capital framework: investing in growth whilst returning nearly US$1bn in dividends and share repurchases during the year.

· Definitive agreement post year-end to acquire CSIdentity Corporation.

· Total revenue from continuing activities was US$4,477m, with both total and organic revenue at constant exchange rates up 5%. At actual exchange rates, total revenue from continuing activities fell by 4% reflecting foreign exchange headwinds during the period. Total revenue was US$4,550m as the Group exited a number of non-core businesses in the year.

· EBIT from continuing activities was US$1,195m, up 5% at constant exchange rates. At actual exchange rates, EBIT from continuing activities was down 6%. Total EBIT was US$1,210m.

· EBIT margin from continuing activities was stable at constant exchange rates. The impact of foreign exchange movements reduced EBIT margin at actual exchange rates by 60 basis points to 26.7%.

· Benchmark profit before tax was US$1,136m, up 3% at constant exchange rates. Profit before tax was US$1,027m at actual exchange rates (2015: US$1,006m).

· Cash flow conversion of 105%. Net debt decreased by US$194m, with net debt to EBITDA ratio remaining at 1.9 times.

· Benchmark EPS was 89.1 US cents, up 5% at constant exchange rates and down 6% at actual exchange rates. Basic EPS was 78.6 US cents (2015: 79.0 US cents).

· Second interim dividend of 27.5 US cents per ordinary share, tobring the total for FY16 to 40.0 US cents per share, up 2% reflecting underlying strength, notwithstanding the foreign exchange headwinds.

· We expect share repurchases of US$400m in FY17.

Brian Cassin, Chief Executive Officer, commented:

'We have made significant progress against our strategic objectives over the past year. We have returned Experian to organic revenue growth within our target range and driven greater efficiencies in our business, whilst rigorously applying our robust capital framework.

As we look forward, we're investing in a range of initiatives which will help us deliver another year of good growth, within our target range of mid single-digit organic revenue growth, with stable margins and further progress in Benchmark earnings per share.'

Contacts

There will be a presentation today at 9.30am (UK time) to analysts and investors at the Bank of America Merrill Lynch Financial Centre, 2 King Edward Street, London, EC1A 1HQ. The presentation can be viewed live via the link from the Experian website atwww.experianplc.comand can also be accessed live via a dial-in facility on +44 (0)20 3037 9164. The supporting slides and an indexed replay will be available on the website later in the day.

Experian will update on first quarter trading on 14 July 2016.

See Appendix 1 and note 4 to the financial statements for definitions of non-GAAP measures

Roundings

Certain financial data have been rounded within this announcement. As a result of this rounding, the totals of data presented may vary slightly from the actual arithmetic totals of such data.

Forward looking statements

Certain statements made in this announcement are forward looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from any expected future events or results referred to in these forward looking statements. See page 13 and note 25 for further information on risks and uncertainties facing Experian.

Company website

Neither the content of the Company's website, nor the content of any website accessible from hyperlinks on the Company's website (or any other website), is incorporated into, or forms part of, this announcement.

About Experian

We are the leading global information services company, providing data and analytical tools to our clients around the world. We help businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. We also help people to check their credit report and credit score, and protect against identity theft. In 2015, we were named by Forbesmagazine as one of the 'World's Most Innovative Companies'.

We employ approximately 17,000 people in 37 countries and our corporate headquarters are in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2016 was US$4.6 billion.

To find out more about our company, please visithttp://www.experianplc.comor watch our documentary, 'Inside Experian'.

Chief Executive Officer's review

We have made significant progress against our strategic objectives over the past year. We delivered organic revenue growth within our mid single-digit target range and enhanced the efficiency of our business, whilst rigorously applying our robust capital framework. As we look forward, we're investing in a range of initiatives to enable us to deliver good growth consistently.

Highlights this year include:

· We made significant progress on the five strategic priorities we outlined last year, having:

o backed a range of new organic investments in health, business information, decisioning software, fraud prevention and in other areas;

o made good progress in repositioning our North America Consumer Services business and returning it to growth in the second half;

o taken steps to enhance our operating model to fully leverage synergies between businesses and drive greater efficiencies;

o sold six non-core activities; and

o returned US$972m in total to shareholders through dividends and net share repurchases.

· We delivered organic revenue growth of 5% for the year, with sequential improvement throughout the year (4% in H1 and 6% in H2). This reflected strong growth in Credit Services and Decision Analytics and improved trends in North America Consumer Services. Foreign exchange effects were a significant headwind and total revenue from continuing activities declined by 4% as a result.

· We maintained margins at constant currency. We benefited from positive operating leverage, counterbalanced by organic investment initiatives. Foreign exchange was a significant headwind, causing the EBIT margin to decline overall to 26.7% at actual rates.

· After the year end we announced a definitive agreement to acquire CSIdentity Corporation ('CSID'), a leading provider of consumer identity management and fraud detection services, further accelerating the execution of our Consumer Services strategy and enabling us to address a broader spectrum of the consumer market. (The acquisition is subject to Hart-Scott-Rodino regulatory approval in the US and is expected to complete during H1).

Regional highlights

North America

We returned to growth in North America during the year, with organic revenue up 3%.

Credit Services performed strongly. Lenders have continued to engage actively in credit marketing and new underwriting as consumer confidence has remained stable. This has supported strong volume growth in our business. We have also secured a number of sizeable wins from financial services clients by taking a 'One Experian' approach, integrating data, analytics, software and expertise from across multiple business activities.

Our strategy of diversifying and building out specialised businesses in new vertical markets continues to produce strong results. Our health business is developing very well. We're building on our market-leading position in revenue-cycle management, where we help healthcare providers to get paid. We see potential to expand into adjacencies, for example we're introducing services to prevent identity and payment fraud. We're also positioning Experian Health to address emerging marketplace needs such as the trend towards 'pay-for-performance', which will affect all healthcare providers. We think this will place greater emphasis on transparency in the payment process, heightening the need for data and analytics and expanding our addressable market.

While Marketing Services has remained weak, we are pleased with progress in cross-channel marketing having on-boarded a number of new clients across a wide range of industries. While growth in cross-channel is not yet sufficient to offset attrition in email marketing, we are encouraged by a growing pipeline of opportunities and a positive reaction for our products from industry analysts. We are also executing on our strategy to more closely align our Experian data quality operations with other parts of Experian, and this is opening up new market opportunities across several vertical markets.

Over the past two years we have taken many actions to reposition Consumer Services. Organic revenue growth moved into positive territory in the second half and the business is now poised to address a larger and more dynamic market. Our goal is to enrich the services we provide, making them more attractive to consumers and helping to diversify our sources of revenue.

Our premium service, Experian.com, is growing strongly. We're attracting members who want to interact and engage, and the take-up rates for our mobile apps and educational services such as ScoreTracker are encouraging. During the year we also launched a new service enabling consumers to access their credit report for free. This is proving to be a successful mechanism for drawing traffic to our site, which can be commercialised in a variety of ways. Since launch we have accumulated over 3m totally free members.

The prospective acquisition of CSID is a further important step in the execution of our strategy, enabling us to attract a broader range of consumers by packaging identity protection as part of our membership services, broaden our offer to third-party white-label partners and expand consumer identity protection services internationally.

Latin America

Helped by counter-cyclical revenues and our new growth initiatives, our business in Latin America has held up well in a worsening economic environment, with organic revenue growth of 7%.

While we continue to be cautious on the economic outlook in Brazil, we are investing during the downturn to develop our business for the longer term. We have restructured our sales approach in order to capture a greater share of the small and medium enterprise market. We are building relationships with consumers to provide new services as well as to collect positive data opt-ins. We have made significant progress in integrating our software and fraud prevention services, which has led recently to much stronger performance in Decision Analytics, and we are repositioning our Marketing Services business to focus more on cross-channel marketing and data quality. We have also taken steps to make our cost base more efficient by setting up a new facility in the city of São Carlos.

These factors have helped us this year and will continue to support growth in the coming year.

UK and Ireland

We delivered a good performance in the UK and Ireland, with organic revenue growth of 5%.

Our business-to-business ('B2B') business in the UK has performed well as we benefit from investments made in product innovation, customer service and ever-closer integration of our product set. Over the year we saw strong market uptake of credit pre-qualification, business information, as well as identity verification services. We have delivered progress across a number of client segments including small businesses, banks, government departments and other areas. It was a good year for new business, with a large proportion of our new wins coming about from the combination of services from across our key business activities. This approach has helped us to maximise opportunities as clients have invested in systems upgrades and fraud prevention. We are also creating new markets as we find new uses for our data, such as in the UK energy sector where we are helping to track fraud.

While Consumer Services delivered growth for the year as a whole, we are seeing evolutionary change in the market, similar to the changes which have occurred in North America. This market shift gave rise to some slowing in signing new member subscriptions and some attrition towards the end of the year, and we expect these trends to continue in the forthcoming year. We are responding in a similar way as we have done in North America, by broadening our product range and diversifying our sources of revenue. For example, we recently secured wins from B2B clients who are providing Experian scores on statements to their customers and other membership services. This helps to re-enforce our leadership position as the provider of scores and data used by the majority of UK lenders in credit underwriting decisions. We plan to launch further new services for consumers in the coming months.

EMEA/Asia Pacific

We have delivered good revenue growth in EMEA/Asia Pacific, with organic revenue growth of 7%.

The actions we've taken to improve performance in EMEA/Asia Pacific are paying off with better revenue growth and improving margins. We have reorganised to drive scale and adopted a more customer-centric approach. We're now focused on fewer markets. We have reduced complexity, centralised functions, and got our largest countries focused on our most successful products. Our growth is being driven by combining credit data with credit decisioning software and analytics, and by focusing on fraud prevention and identity verification, and we're winning new deals in cross-channel marketing. As a result, the average contract value on new wins is increasing, particularly in Asia Pacific, and we have a strong pipeline. We will continue with this focused approach and look to further enhance profitability over the coming year.

EBIT margin

We maintained EBIT margin at constant currency. We faced exceptional foreign exchange movements which reduced reported Group revenue by US$412m and EBIT by US$137m compared to last year and which gave rise to a 60 basis points reduction in the actual EBIT margin to 26.7%. If recent rates prevail, we no longer expect foreign exchange to be a headwind for the year ending 31 March 2017.

Cash generation and uses of cash

Cash flow conversion was strong, with EBIT conversion into operating cash flow of 105%. Operating cash flow was US$1,270m, of which US$325m was utilised in organic capital investment. Net disposal proceeds amounted to US$163m,net share repurchases wereUS$592m and equity dividends amounted to US$380m. After other small outflows, netdebt was reduced by US$194m to US$3,023m.

At 31 March 2016, net debt was 1.9 times EBITDA, compared to our target leverage range of 2 to 2.5 times. After the year end, we announced a definitive agreement to acquire CSID for US$360m. Pro forma for this acquisition, net debt to EBITDA would be 2.1 times for the year ending 31 March 2016.

Return on capital employed

Return on capital employed for the year was 15.4% (2015: 14.9%). This represented organic improvement of 70 basis points, offset by a 20 basis points headwind from disposals and foreign exchange effects.

Dividend and share repurchases

We are announcing a second interim dividend of 27.5 US cents per share, tobring the total for FY16 to 40.0 US cents per share, up 2% on the prior year. This dividend will be paid on 22 July 2016 to shareholders on the register at the close of business on 24 June 2016. We also expect to execute share repurchases of US$400m in the forthcoming year, which includes US$144m to complete the existing US$800m programme.

Group financial results

Revenue by geography

1. 2015 restated for the divestment of Baker Hill (North America), FootFall (North America, UK & Ireland and EMEA/Asia Pacific), Consumer Insights (all regions) and other small businesses in EMEA/Asia Pacific.

See Appendix 2 (page 14) for analyses of revenue, EBIT and EBIT margin by business segment.

Income statement, earnings and EBIT margin analysis

1. 2015 restated for the divestment of Baker Hill (North America), FootFall (North America, UK & Ireland and EMEA/Asia Pacific), Consumer Insights (all regions) and other small businesses in EMEA/Asia Pacific.

See Appendix 1 (page 14) and note 4 to the financial statements for definitions of non-GAAP measures.

See Appendix 2 (page 14) for analyses of revenue, EBIT and EBIT margin by business segment.

Total growth % at constant exchange rates below Total EBIT are estimated.

Business review

North America

Total revenue from continuing activities in North America was US$2,471m, up 3% on both a total and organic basis.

Credit Services

Total and organic revenue growth was 10%, with strong performances from all business activities. Across both our consumer and business credit bureaux, credit prospecting, origination and customer management volumes were strong, and we secured new business wins in financial services and other segments, as we execute on our strategy. Automotive performed well as strength in vehicle unit sales drove demand for vehicle history reports and strength in credit volumes. In health we continue to see rapid growth, driving strength in client bookings and expansion of total contract value amongst existing hospital and physician customers.

Decision Analytics

Total and organic revenue declined 2%, as weakness in public sector more than offset strength in fraud prevention.

Marketing Services

Both total revenue and organic revenue declined by 2%. We saw further growth in cross-channel marketing, driven by new client wins and by expansion within existing clients. Data quality also delivered growth, as did our data targeting business, helped by growth in digital advertising channels. These factors were offset by further attrition in email marketing.

Consumer Services

Both total revenue and organic revenue declined by 3% for the year. There was significant improvement as the year progressed, as the business returned to growth delivering organic revenue growth of 2% in the second half. This reflected continued strong growth in our premium brand, Experian.com and on-boarding of a new affinity partner. These factors offset contraction in the legacy direct-to-consumer ('D2C') portfolio.

EBIT and EBIT margin

For continuing activities, North America EBIT was US$755m, up 2%. The EBIT margin was 30.6%, (2015: 31.0%), reflecting ongoing investment in key strategic growth areas.

Latin America

Total revenue from continuing activities in Latin America was US$633m, with both total and organic revenue growth of 7% at constant exchange rates.

Credit Services

At constant exchange rates, total and organic revenue growth in Credit Services was 7%, with good growth across both consumer and business information. In Brazil, consumer information was helped by strong volumes of counter-cyclical products, particularly delinquency notifications and collections, while business information was driven by higher volumes and good demand for new scores and analytics from small and medium enterprise customers. In our other Latin American markets growth was strong, with progress in business information as we continue to build our product range for small and medium enterprises.

Decision Analytics

Total and organic revenue growth was 10% at constant exchange rates. After a weak start, we benefited from considerable momentum, particularly in our Spanish Latin America markets. We have secured several multi-year relationships with larger customers as we integrate credit risk management software with credit data.

Marketing Services

Total and organic revenue at constant exchange rates declined 4%. While the year started weakly, there was a significant improvement in the second half driven by cross-channel marketing and data quality in Brazil.

EBIT and EBIT margin

For Latin America, EBIT increased by 7% at constant currency. The depreciation of the Brazilian real relative to the US dollar had a significant impact on reported EBIT, which decreased to US$226m (2015: US$313m). Foreign exchange movements also had a significant impact on the reported EBIT margin, which was 35.7% compared to 36.6% in the prior year.

UK and Ireland

In the UK and Ireland, total revenue from continuing activities was US$956m, with total and organic revenue growth of 5% at constant exchange rates.

Credit Services

Total and organic revenue growth at constant exchange rates was 6%, with growth across consumer information, business information and automotive. Consumer information growth was driven by new business wins, strength in credit reference volumes, a strong performance from credit pre-qualification services and momentum in key verticals such as financial services. In business information, we are making good progress on our key initiatives including the expansion of the small and medium enterprise channel through products such as BusinessExpress, as well as new business wins from large clients.

Decision Analytics

At constant exchange rates, both total and organic revenue rose 12%. We saw strength across a variety of sectors and products in a strong year for wins from banking clients and elsewhere. There was a one-off boost in identity management from the successful roll-out of a new verification service in the UK public sector, as well as strong demand from banks for credit risk management and fraud prevention software and analytics.

Marketing Services

At constant exchange rates, total revenue growth in Marketing Services was flat and organic revenue declined by 1%. We delivered growth in data, which has benefited from investments we've made in targeted advertising in digital channels, and in cross-channel marketing. This offset softness in email marketing. We also continue to see good forward bookings for our data quality business.

Consumer Services

At constant exchange rates total and organic revenue growth was 4%. Growth was driven by higher D2C memberships for Experian CreditExpert in the first half of the year.

EBIT and EBIT margin

For the UK and Ireland, EBIT from continuing activities was US$300m, up 4% at constant exchange rates. The EBIT margin was 31.4% (2015: 31.7%), reflecting organic investment in growth initiatives, higher legal and regulatory costs and the impact of foreign exchange.

EMEA/Asia Pacific

Total revenue from continuing activities in EMEA/Asia Pacific was US$417m, with total and organic revenue both up 7% at constant exchange rates.

Credit Services

Total and organic revenue at constant exchange rates decreased by 3%. Growth in Asia Pacific was strong, particularly in Japan and India, which partially offset a decline across our bureaux in EMEA. The decline in EMEA was primarily due to weak conditions in some markets such as the Nordics and South Africa.

Decision Analytics

Total and organic revenue growth at constant exchange rates were both 18%. There was significant growth momentum, driven by a number of new client wins for credit risk management software, other credit decisioning tools and fraud prevention.

Marketing Services

Total and organic revenue growth at constant exchange rates were both 10% as we benefited from new client wins for integrated data and cross-channel marketing capabilities.

EBIT and EBIT margin

Losses in EMEA/Asia Pacific were significantly reduced to US$(4)m (2015: US$(10)m). EBIT margin improved to (1.0)% from (2.3)% at actual exchange rates, as operating efficiencies were partially offset by foreign exchange headwinds.

Group financial review

Key financials

The Group has identified and defined certain non-GAAP measures, as they are the key measures used within the business to assess performance. These measures are used within this Group financial review and, unless otherwise indicated, all discussion of Revenue, EBIT and EBIT margin relates to continuing activities only.

Summary

The Group made significant progress during the year, with organic revenue growth improving to an average of 5% for the year as a whole. At constant currency, EBIT margin was stable, reflecting continued focus on efficiency and investment in our strategic growth initiatives.

The Group reports its financial results in US dollars and therefore the weakness of the Group's other trading currencies (primarily the Brazilian real) against the US dollar during the year decreased our total revenue by US$412m and Total EBIT by US$137m, with an adverse impact on EBIT margin of 60 basis points. Details of the principal exchange rates used are given on page 13.

The background to these results and Group profit performance by geography is discussed within pages 3 to 10. A summary of performance by business segment is given in Appendix 2 on page 14.

The Group reported Benchmark PBT of US$1,136m (2015: US$1,231m). Benchmark EPS of 89.1 US cents (2015: 95.2 US cents) represents an increase of 5% at constant currency and a reduction of 6% at actual exchange rates. The net interest expense of US$74m (2015: US$75m) reflects the continuing benefit of low US dollar interest rates, together with the very strong cash flow performance. The Benchmark tax rate was 24.9% (2015: 24.4%).

The Group continued to deliver strong cash generation, with a 105% conversion of Total EBIT to operating cash flow (2015: 104%). Investment activity in the year has been undertaken within the capital allocation framework outlined last year and has been primarily organic. The Group has continued to focus its portfolio, making six disposals for total cash receipts of US$214m.

Shareholder returns

The Group extended its previously announced US$600m share purchase programme to US$800m. At 31 March 2016, US$656m of this programme had been completed.

Taking the total dividend and share purchases together, during the year the Group returned a total of US$972m to shareholders.

Growing the business

The Group delivered improving growth momentum during the year, with organic revenue growth returning to its mid single-digit target range.

Total revenue growth from continuing activities was 5% at constant exchange rates in the year ended 31 March 2016, with a reduction of 4% at actual rates.

This year, Total EBIT was US$1,210m, down 7% at actual exchange rates but up 3% at constant currency. Expenditure through the income statement in support of growth included initiatives in key areas such as Brazil, Health, Consumer Services and Credit Services. We also invested in regulatory and compliance expenditure, and restructuring and productivity initiatives.

EBIT margin from continuing activities was stable at constant currency. The impact of foreign exchange movements reduced EBIT margin by 60 basis points overall for the year.

Generating value

The table at Appendix 3 on page 15 provides a reconciliation of our underlying profitability, as measured by Total EBIT, to our statutory profit before tax.

Our net interest expense and the related cash flows have benefited from the strong cash generation and from low interest rates globally. At 31 March 2016, the interest on 91% of our net funding was at fixed rates (2015: 83%).

Our effective tax rate on Benchmark PBT was 24.9%, reflecting the mix of profits and prevailing tax rates by territory. The equivalent cash tax rate remains below our Benchmark tax rate and a reconciliation is provided in the table at Appendix 7 on page 16. It is currently anticipated that our cash tax rate will increase and move closer to our Benchmark tax rate over the course of the next six years, as tax amortisation of goodwill on earlier acquisitions and prior tax losses are utilised.

Basic EPS was 78.6 US cents (2015: 79.0 US cents). Basic EPS for the year ended 31 March 2016 included a loss of 1.3 (2015: earnings of 2.1) US cents per share in respect of discontinued operations. Benchmark EPS was 89.1 US cents (2015: 95.2 US cents), a decrease of 6% at actual exchange rates but an increase of 5% at constant currency. Further information is given in note 11 to the financial statements. At 31 March 2016, Experian had 1,023 million shares in issue of which some 77 million were held by employee trusts and as treasury shares. Accordingly, the number of shares to be used for the purposes of calculating basic EPS from 31 March 2016 is 946 million. Issues and purchases of shares after 31 March 2016 will result in amendments to this figure.

The total dividend per share for the year is covered 2.2 times by Benchmark EPS (2015: 2.4 times) in accordance with our previously declared policy. Ordinary dividends paid in the year amounted to US$380m (2015: US$374m).

Cash and liquidity management

As shown in the Cash flow and net debt summary table at Appendix 5 on page 16, we generated very strong operating and free cash flows in the year. The continued strength of our operating cash flow performance reflects the nature of our business and financial model and our focus on working capital management.

Net debt at 31 March 2016 was US$3,023m (2015: US$3,217m), with undrawn committed borrowing facilities of US$2,175m (2015: US$2,085m). Our net debt at 31 March 2016 was 1.9 times EBITDA (2015: 1.9 times), compared to the target range of 2.0 to 2.5 times that we adopted last year.

Acquisition expenditure has been modest in both the current and prior years and our capital expenditure of US$339m (2015: US$380m) was 7.5% (2015: 7.9%) of total revenue. Net capital expenditure was US$325m (2015: US$376m).

Foreign exchange rates

Foreign exchange - average rates

The principal exchange rates used to translate total revenue and Total EBIT into the US dollar are shown in the table below.

Foreign exchange - closing rates

The principal exchange rates used to translate assets and liabilities into the US dollar at the year end dates are shown are shown in the table below.

Risks and uncertainties

The ten principal risks and uncertainties faced by the Group are summarised in note 25 to the financial statements.

Appendices

1. Non-GAAP financial information

Experian has identified and defined certain measures that it believes assist in understanding the performance of the Group. These measures are not defined under IFRS and they may not be directly comparable with other companies' adjusted measures. The non-GAAP measures are not intended to be a substitute for, or superior to, any IFRS measures of performance but management has included them as these are considered to be key measures used within the business for assessing performance. Information on certain of our non-GAAP measures is set out below in the further appendices. Definitions of all our non-GAAP measures are given in note 4 to the financial statements.

1. 2015 restated for the divestment of Baker Hill, FootFall, Consumer Insights and other small businesses and their movement to discontinuing activities within the relevant business segments.

2. Discontinuing activities comprise discontinuing Credit Services, Decision Analytics and Marketing Services businesses.

3. Thegrowth percentages at constant rates for EBIT margin show the margin change at constant exchange rates.

3. Reconciliation of Total EBIT to statutory profit before tax

4. Exceptional items and Other adjustments made to derive Benchmark PBT

5. Cash flow and net debt summary

Total investment of US$347m (2015: US$443m) comprises cash flows for net capital expenditure and acquisitions.

6. Reconciliation of net capital expenditure

7. Cash tax reconciliation

Group income statement

for the year ended 31 March 2016

1. Total EBIT, Benchmark items and full year dividend per share are non-GAAP measures, defined where appropriate in note 4 to the financial statements.

2. The loss before tax for non-benchmark items of US$109m (2015: US$225m) comprises a credit for exceptional items of US$37m (2015: charge of US$2m) and charges for other adjustments made to derive Benchmark PBT of US$146m (2015: US$223m). Further information is given in note 7 to the financial statements.

The segmental disclosures in notes 5 and 6 indicate the impact of business disposals on the comparative revenue and Total EBIT figures.

Group statement of comprehensive income

for the year ended 31 March 2016

1. Amounts reported within other comprehensive income are in respect of continuing operations and, except as reported for post-employment benefit assets and obligations, there is no associated tax. Currency translation items are taken directly to the translation reserve within other reserves. Other items within other comprehensive income are taken directly to retained earnings.

Group balance sheet

at 31 March 2016

Group statement of changes in total equity

for the year ended 31 March 2016

for the year ended 31 March 2015

Group cash flow statement

for the year ended 31 March 2016

Notes to the financial statements

for the year ended 31 March 2016

1. Corporate information

Experian plc (the 'Company') is the ultimate parent company of the Experian group of companies ('Experian' or the 'Group'). The Company is incorporated and registered in Jersey as a public company limited by shares and is resident in Ireland. The Company's ordinary shares are traded on the London Stock Exchange's Regulated Market (Premium Listing).

2. Basis of preparation

The financial information set out in this preliminary announcement does not constitute the Group's statutory financial statements, which comprise the annual report and audited financial statements, for the years ended 31 March 2016 or 31 March 2015 but is derived from the statutory financial statements for the year ended 31 March 2016. The Group's statutory financial statements for the year ended 31 March 2016 will be made available to shareholders in June 2016 and delivered to the Jersey Registrar of Companies in due course. The auditors have reported on those financial statements and have given an unqualified report which does not contain a statement under Article 111(2) or Article 111(5) of the Companies (Jersey) Law 1991. The Group's statutory financial statements for the year ended 31 March 2015 have been delivered to the Jersey Registrar of Companies. The auditors reported on those financial statements and gave an unqualified report which did not contain a statement under Article 111(2) or Article 111(5) of the Companies (Jersey) Law 1991.

The Group's statutory financial statements for the year ended 31 March 2016 have been:

· prepared in accordance with the Companies (Jersey) Law 1991 and International Financial Reporting Standards ('IFRS' or 'IFRSs') as adopted for use in the European Union ('EU') and IFRS Interpretations Committee interpretations;

· prepared on a going concern basis and under the historical cost convention, as modified for the revaluation of available-for-sale financial assets and certain other financial assets and financial liabilities;

· presented in US dollars, the most representative currency of the Group's operations, and generally rounded to the nearest million; and

· prepared using the principal exchange rates set out on page 13.

Other than those disclosed in this preliminary announcement, no significant events impacting the Group have occurred between 31 March 2016 and 10 May 2016 when this preliminary announcement was approved for issue.

This preliminary announcement has been prepared in accordance with the Listing Rules of the UK Financial Conduct Authority, using the accounting policies applied in the preparation of the Group's statutory financial statements for the year ended 31 March 2016. Those policies were published in full in the Group's statutory financial statements for the year ended 31 March 2015 and are available on a corporate website, at www.experianplc.com/annualreport.

3. Recent accounting developments

There have been no accounting standards, amendments and interpretations effective for the first time in these financial statements and which have had a material impact on the financial statements.

There are a number of new standards and amendments to existing standards currently in issue but not yet effective, including three significant standards:

· IFRS 9 'Financial instruments';

· IFRS 15 'Revenue from contracts with customers'; and

· IFRS 16 'Leases'.

IFRS 9 and IFRS 15 are now expected to be effective for Experian for the year ending 31 March 2019 with IFRS 16 expected to be effective for the year ending 31 March 2020 (all subject to EU endorsement). It is not currently practicable to quantify their effect. IFRS 15 introduces a single, principles-based five-step revenue recognition model to be applied to all sales contracts. Our assessment of the impact of IFRS 15 on the Group financial statements has commenced; areas of potential change have been noted and are undergoing further review.

There are no other new standards, amendments to existing standards or interpretations that are not yet effective that would be expected to have a material impact on the Group. Such developments are routinely reviewed by the Group and its financial reporting systems are adapted as appropriate.

Notes to the financial statements (continued)

for the year ended 31 March 2016

4. Use of non-GAAP measures in the financial statements

As detailed below, the Group has identified and defined certain measures that it believes assist understanding of Experian's performance. The measures are not defined under IFRS and they may not be directly comparable with other companies' adjusted measures. The non-GAAP measures are not intended to be a substitute for, or superior to, any IFRS measures of performance but management has included them as they consider them to be key measures used within the business to assess performance.

(a) Benchmark profit before tax ('Benchmark PBT')

Benchmark PBT is disclosed to indicate the Group's underlying profitability. It is defined as profit before amortisation and impairment of acquisition intangibles, impairment of goodwill, acquisition expenses, adjustments to contingent consideration, exceptional items, financing fair value remeasurements, tax and discontinued operations. It includes the Group's share of continuing associates' pre-tax results.

An explanation of the basis on which Experian reports exceptional items is provided below. Other adjustments made to derive Benchmark PBT are explained as follows:

· Charges for the amortisation and impairment of acquisition intangibles are excluded from the definition of Benchmark PBT because these charges are based on judgments about their value and economic life. Impairment of goodwill is similarly excluded.

· Acquisition expenses relating to successful, active or aborted acquisitions are excluded from the definition of Benchmark PBT as they bear no relation to the Group's underlying performance or to the performance of any acquired businesses. Adjustments to contingent consideration are similarly excluded.

· Charges and credits for financing fair value remeasurements within finance expense in the Group income statement are excluded from the definition of Benchmark PBT. These include that element of the Group's derivatives that is ineligible for hedge accounting together with gains and losses on put options in respect of acquisitions. Amounts recognised generally arise from market movements and accordingly bear no direct relation to the Group's underlying performance.

(b) Earnings before interest and tax ('Total EBIT' and 'EBIT')

Total EBIT is defined as Benchmark PBT before the net interest expense charged therein. Total EBIT excluding the results of discontinuing activities is defined and reported as EBIT.

(c) Earnings before interest, tax, depreciation and amortisation ('EBITDA')

EBITDA is defined as Total EBIT before the depreciation and amortisation charged therein.

(d) Continuing activities and Discontinuing activities

Businesses trading at 31 March 2016, which are not disclosed as discontinuing activities, are treated as continuing activities. Discontinuing activities are businesses sold, closed or identified for closure during a financial year. These are treated as discontinuing activities for both revenue and EBIT purposes. The results of discontinuing activities are disclosed separately with the results of the prior period re-presented as appropriate. This measure differs from the definition of discontinued operations set out in IFRS 5.

(e) Constant exchange rates

To highlight its organic performance, Experian discusses its results in terms of growth at constant exchange rates, unless otherwise stated. This represents growth calculated after translating both years' performance at the prior year's average exchange rates.

(f) Total growth

This is the year-on-year change in the performance of Experian's activities. Total growth at constant exchange rates removes the translational foreign exchange effects arising on the consolidation of Experian's activities.

(g) Organic revenue growth

This is the year-on-year change in the revenue of continuing activities, translated at constant exchange rates, excluding acquisitions until the first anniversary of their consolidation.

Notes to the financial statements (continued)

for the year ended 31 March 2016

4. Use of non-GAAP measures in the financial statements (continued)

(h) Benchmark earnings and Total benchmark earnings

Benchmark earnings comprise Benchmark PBT less attributable tax and non-controlling interests. The attributable tax for this purpose excludes significant tax credits and charges arising in the year which, in view of their size or nature, are not comparable with previous years, together with tax arising on exceptional items and on total adjustments made to derive Benchmark PBT.

Benchmark PBT less attributable tax is designated as Total benchmark earnings.

(i) Benchmark earnings per share ('Benchmark EPS')

Benchmark EPS comprises Benchmark earnings divided by the weighted average number of issued ordinary shares, as adjusted for own shares held.

(j) Benchmark PBT per share

Benchmark PBT per share comprises Benchmark PBT divided by the weighted average number of issued ordinary shares, as adjusted for own shares held.

(k) Benchmark tax charge and rate

The Benchmark tax charge is the tax charge applicable to Benchmark PBT. It differs from the Group tax charge by tax attributable to exceptional items and other adjustments made to derive Benchmark PBT, and exceptional tax charges. A reconciliation is provided in note 9(b) to these financial statements. The related effective rate of tax is calculated by dividing the Benchmark tax charge by Benchmark PBT.

(l) Exceptional items

The separate reporting of non-recurring exceptional items gives an indication of the Group's underlying performance. Exceptional items include those arising from the profit or loss on disposal of businesses, closure costs of major business units, costs of significant restructuring programmes and other significant one-off items. All other restructuring costs are charged against Total EBIT, in the segments in which they are incurred.

(m) Full year dividend per share

Full year dividend per share comprises the total of dividends per share announced in respect of the financial year.

(n) Operating and free cash flow

Operating cash flow is Total EBIT, plus amortisation, depreciation and charges in respect of share-based incentive plans, less capital expenditure net of disposal proceeds and adjusted for changes in working capital and the profit or loss retained in continuing associates. Free cash flow is derived from operating cash flow by excluding net interest paid, tax paid in respect of continuing operations and dividends paid to non-controlling interests.

(o) Cash flow conversion

Cash flow conversion is operating cash flow expressed as a percentage of Total EBIT.

(p) Net debt

Net debt is borrowings (and the fair value of derivatives hedging borrowings) excluding accrued interest, less cash and cash equivalents reported in the Group balance sheet and other highly liquid bank deposits with original maturities greater than three months.

Notes to the financial statements (continued)

for the year ended 31 March 2016

5. Segment information

Notes to the financial statements (continued)

for the year ended 31 March 2016

5. Segment information (continued)

Revenue is primarily attributable to countries other than Ireland. No single client accounted for 10% or more of revenue in the current or prior year. Revenue from the USA, Brazil and the UK in aggregate comprises 88% (2015: 87%) of Group revenue.

(c) Revenue by business segment

The additional analysis of revenue from external customers provided to the chief operating decision-maker and accordingly reportable under IFRS 8 is given within note 6. This is supplemented by voluntary disclosure of the profitability of groups of service lines. For ease of reference, Experian continues to use the term 'business segments' when discussing the results of groups of service lines.

Notes to the financial statements (continued)

for the year ended 31 March 2016

6. Information on business segments (including non-GAAP disclosures)