Earnings

IHS reports better-than-expected profit on lower costs

IHS, the publisher of Jane's Defence Weekly, reported a better-than-expected quarterly profit, helped by lower operating expenses.

The business and information services provider's shares rose as much as 11.6 percent to $122.92 in early trading.

The company said acquisition-related costs fell to $884,000 from $5.4 million in the fourth quarter ended Nov. 30.

"We took a pause after our very big acquisition of R.L. Polk, we de-levered and now we are acquiring again," Chief Executive Scott Key said.

The company bought R.L. Polk, the owner of used-car history provider Carfax and a provider of automobile industry data, in July 2013. It has bought about 70 companies since going public in 2005.

IHS said it plans to acquire businesses in the maritime and trade, chemicals and technology sectors in the near future.

The company's current businesses include Cambridge Energy Research Associates and technology market research firm iSuppli.

The company's net income increased to $60.1 million, or 87 cents per share, in the quarter ended Nov. 30 from $40.8 million, or 60 cents per share, a year earlier.

Excluding items, IHS earned $1.68 per share.

Revenue rose about 4 percent to $582.3 million.

Total organic revenue grew about 4 percent, strengthened by automotive and maritime and trade segments.

Subscription revenue, which accounts for three-quarters of total revenue, increased 6 percent.

Analysts on average had expected a profit of $1.55 per share and revenue of $585.7 million, according to Thomson Reuters I/B/E/S.

The company forecast an adjusted profit of $6.10-$6.30 per share and revenue between $2.36 billion and $2.40 billion for the year ending Nov. 30, 2015. Revenue growth within the energy market was slow, it said.

"Energy prices have fallen from over a $100 just a few months ago to $50 a barrel and if you look at our growth last year, energy was an important part of our total growth," Key said.

The business will continue to grow in the coming year, the CEO added.

Analysts were expecting full-year profit of $6.36 per share on revenue of $2.37 billion.

IHS said it expected 6-7 percent organic revenue growth for the year and forecast margins to expand by 1 percentage point.