Nielsen Holding NV (



Q3 2011 Earnings Call

October 27, 2011 08:30 a.m. ET


Liz Zale – SVP, Investor Relations

David Calhoun – CEO

Brian West – CFO


Suzanne Stein – Morgan Stanley

Sara Gubins – BofA/Merrill Lynch

Ashwin Shirvaikar – Citi

Michael Meltz – JP Morgan

Bishop Cheen – Wells Fargo

Brian Karimzad – Goldman Sachs

William Bird – Lazard Capital Markets

Kelly Flynn – Credit Suisse

Matt Chesler – Deutsche Bank

Bill Warmington – Raymond James

Robert Riggs – William Blair



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Ladies and gentlemen thank you for holding, and welcome to this conference call on third quarter 2011 results for Nielsen Holdings N.V. Please note all lines are on listen-only mode at this time. I will now turn the call over to the host Liz Zale, Senior Vice President of Investor Relations.

Ms. Zale, please proceed.

Liz Zale

Thank you. Good morning everyone and thanks for joining us to discuss Nielsen’s third quarter results. On the call with me this morning is David Calhoun, Chief Executive Officer and Brian West, Chief Financial Officer of Nielsen Holdings N.V.

Today’s discussion may contain forward-looking statements made pursuant to the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995. These and other statements that relates to future results and events are based on Nielsen’s current expectations as of October 27, 2011. Our actual results in future periods may differ materially from those currently expected because of the number of risks and uncertainties.

The risks and uncertainties that we believe are material are outlined in our disclosure filings and materials you can find on or in the SEC’s website at We disclaim any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, expect as may be required by law. Our outlook is provided for the purpose of providing information about current expectations for 2011. This information may not be appropriate for other purposes.

A presentation is posted on our website with summary information for this call. With that I will now turn the call over to David Calhoun.

David Calhoun

Thanks Liz, thanks everyone for joining us. Let me start with the financial picture.

I would characterize this as a high quality quarter. We had a good strong performance from pretty much everyone. Revenue grew at 10% on a reported basis, 6% on a constant currency basis. Adjusted EBITDA grew 10% and 7% on a constant currency basis, and as I have characterized in previous quarters we really remain fully invested funding all of the things that we would like to do and the opportunities we see ahead.

Brian will take you into a fair amount of more detail. Before that just a couple of comments on more of a macro basis. First with respect to the economy you know that recently we published a competence metric that was relatively low compared to many of the quarters previously. What is very interesting about this moment in time is that while confidence is low, and I attribute most of it to a lot of the political rhetoric and media coverage that accompanies it. Underlying retail performance is not so bad, and so as I survey and talk to clients in our world with respect to planning for next year, I don’t see much in the way of pulling back. What I do see is caution, I do see hedging, I do see those kinds of moves, but nothing like what we saw in the tail end of ’08 going into 2009.

With respect to macroeconomic trends, the two things that matter to us most are still going full speed ahead. We continue to expand our developing market coverage and the measurement of content viewing across both platforms and devices. These trends will continue for quite some time and offers us opportunities every step of the way.

If there is any geographic weakness or I would more refer to it as sluggishness, it’s Europe, Western Europe. Western Europe has continued to be a sort of a sluggish pattern for us and I expect it to stay that way for quite some time.

With respect to initiatives, like everyone knows we closed on the Wal-Mart Coop agreement and we are in full implementation mode. It is going very well. The program continues to deliver. The way I think you ought to think about economic models is roughly second quarter next year we will have numbers to report to manufacturers and then therefore revenue opportunities to be realized during that second quarter. Our view is that this gets to EBITDA positive by 12 month period from the start.

Nielsen Online campaign ratings were in over a 100 active campaigns being run on it. We have got 18 very significant, what I would refer to as sophisticated advertisers, are running these campaigns, and so far so good. Each and every one of these campaigns will build their own use case, meaning what do they do to adjust as they go forward based on the numbers that we track and report to them every day. Finally, we made an acquisition of a small company called Marketing Analytics.

Well, it’s small, it’s very important to us, because I think as you know Marketing Analytics is in the business of marketing mixed models. These are the models that advertisers use to allocate marketing funds from across different mediums and also across sales promotion. This is the way we affect movement of real money through different mediums, and for us that’s very important. Finally, we will reaffirm our 2011 guidance and I will turn it over to Brian to dig into the financials.

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