Investor Relations

Andrew Kramer
Director, Investor Relations

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To My Fellow Interactive Data Shareholders

Andrew Hajducky, EVP, CFO and Treasurer As you can read further in our Annual Report on Form 10-K,  Interactive Data had a very successful year in 2008 as we made significant progress against our plans.

Revenue in 2008 grew 8.8% to $750.5 million, just eclipsing the three-quarters of a billion dollars milestone. Income from operations grew 19.4% to $209.7 million in 2008 as revenue growth outpaced spending. Our expense structure is largely of a fixed cost nature involving intellectual capital, communications infrastructure and data content. As a result, a healthy percentage of every incremental dollar of revenue we generate can be converted into profit. Net income in 2008 grew 13.2% to $142.6 million, or $1.48 per diluted share. Our strong operating performance in 2008 translated into another year of solid net cash provided by operating activities, which increased 6.3% to $196.2 million.interactive The preceding pages detail strategic and operational milestones and accomplishments that supported our financial performance last year.

We continue to use our capital in ways that will facilitate the global expansion of our business as well as return cash to our shareholders. We completed two acquisitions totaling a net of over $43 million that enable us to now have a direct presence in two strategically important international markets, Italy and Japan. Our capital expenditures of $45.5 million were primarily directed to support our infrastructure
so that we are best positioned to address our customers’ needs for reliable and timely delivery of high-quality content embedded in our services and solutions. 

Our use of capital in 2008 also illustrates our efforts to make Interactive Data more attractive to current and prospective investors by returning cash to shareholders through dividends. We returned 52.8% of the net cash provided by operating activities to shareholders during the past year through the $0.50 per common share special dividend paid in January 2008 and the quarterly dividends that totaled $0.60 per common share in 2008. Recognizing the strength of our balance sheet and the historically impressive cash generation characteristics of our business, our Board authorized a 33.3% increase in our quarterly dividend to $0.20 per common share,interactive starting in 2009. In addition, we spent $52.5 million, or the equivalent of $0.54 per diluted share, during 2008 as part of our ongoing stock repurchase activity. In December 2008, we expanded the scope of the stock buyback program by an additional two million shares.

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