S&P Global Inc. (SPGI) Earnings Call Transcript & Summary

All right. All right. Good afternoon, everyone. Thank you so much for being here. We're very pleased to welcome S&P Global to the conference. I'm Faiza Alwy, for those of you who don't know, I'm the business services analyst at Deutsche Bank. We have with us Ewout Steenbergen, CFO of the company. Ewout, thank you so much for being here.

Thank you, Faiza, and thank you for organizing. Really great event, great conference and congratulations with your beautiful office here.

Thank you. Thank you so much. I guess let's just first start with your press release this morning where you suspended guidance. You reported results and gave guidance about 4 weeks ago. Talk to us about what's changed and what's happened in the last 4 weeks.

Yes. We decided to suspend guidance because showing up here at the conference, it was clear that there was no way we could affirm the guidance that we put out with our first quarter earnings results. So it was necessary to make a change to that. And why was it necessary to make an update? The reason is that, over the last few weeks, we have noticed that the month of May, the issuance requirement was very weak. And May is normally, from a seasonality perspective, a very important month for issuance. And looking at that weak month of May and particularly hardly any activity in the below investment-grade and leveraged loan space, we realized that the guidance we gave a couple of weeks ago was not applicable. We decided to withdraw guidance for the reason that the potential outcomes from here are quite wide. And what I mean with that is we know that, at some point, the issuance environment will come back. This is a temporary headwind. We have seen this in the past, for a few quarters, every 2, 3 times every decade that a situation like this is happening. But it's very hard to predict when it's coming back. It's not a question of if, but when. It's very hard to predict when it's coming back. So what we thought is more useful, instead of putting new guidance out, to put a scenario out around our Ratings business. And the scenario assumes the following: if we will see over the next 7 months the same trends in the issuance environment of what we have seen during the first 5 months, which means from an overall bond issuance, market issuance, high teens, which translates into ratings -- rated issuance 30% to 35% decline and levered loan somewhere low 40% decline, that we would expect in such a scenario with, again, no markets coming back for the remainder of the year, that the impact on the Ratings revenue would be about $600 million, and the margins of Ratings would be declining to high 50s. So that is the assumption. And we thought it's important to put a quantification around it. Many investors have asked us about this. They say, "If you don't assume anything going better, what would be the outcome for the company?" And they have given that clarity. We thought it was an important step. What we're planning to do is that when we will come to the market with our second quarter results, at that moment, to give new guidance for the remainder of the year. We have 2 months of more observations. We think that's a better position to be in. But at least to go out with this new -- this clarity today and the quantification around that scenario, we thought that this would be the most helpful for us to do to investors at this point in time.

Okay. Is it fair to think of this scenario as sort of the worst-case scenario that nothing is going to -- it won't get worse from here? Or is -- how would you characterize the scenario?

Yes. I think worst case is a very big term because what is worst case? We know if the Ukraine war will escalate to something that the world has never seen in its history, then of course, yes, I think all bets are off. But I think this is definitely a scenario where we say, it has been extremely weak in the first 5 months, now we're saying it continues to be very weak in the next 7 months. That is a quite significant bookmark to put around results from a quantification perspective. Again, I think it's very important for me to emphasize, there's nothing that has changed with respect to the fundamentals of our business. This is a matter that relates very much to one business, and in fact, one element of one business, transactional revenue in Ratings. We have also nontransactional. We have 5 other divisions. We would never have updated, suspended guidance for the other 5 divisions. I think the fundamentals of where we are from a business perspective are exactly the same. We're focusing on the execution, the integration, delivering on our synergies and on the combined company. At some point, we know the issuance environment will become stronger again. That business, the Ratings revenue will come back. And I think at that moment, the company would incredibly strong. Plus we will have the benefit from the buyback that we will be doing over the next period. And of course, we're taking a lot of shares out of the market at this moment. So I just want to say there's nothing, in my view, that has changed at all with respect to the fundamentals of our business. This is a very specific isolated matter with respect to 1 of our 6 businesses, and it is also a temporary matter that we're dealing with.

Yes. Yes. Just -- sorry, just 2 more things on this. One is, what do you need? And like what does the market need for things to, I guess, normalize or maybe improve from here? And the second question is what is normalization? Like, do you think of 2021 as a normal year? Do you think of 2019 as a normal year? So just your perspective on what's normal and what will get you there.

Yes. The most unusual, in my view, about the debt markets today is that there is hardly any activity in below investment-grade space. We haven't seen any period in the history where it actually was closed for such a long period of time. Even during the financial crisis, high yield wasn't closed this long. So that makes it unusual. That also then, in an answer to your question of what needs to happen to normalize -- I think about it in the way of, at some point, in general, the market start to calm down, I think the appetite for risk assets will go up. In that way, we will see some high-yield issuers put their toe in the water, start to test the market. If those first transactions are going well, then that market will go -- will open up. And there will be many more issuers starting to come back in the high yield market. This is not so much a supply issue. This is a demand issue. There's just very little appetite given the fear for risk assets at this moment. So once that is coming back, I think then you see that opening up. We know the refinancing pipeline is very strong. We know that there's a lot of issuers waiting on the sideline. And at some point, they want to come to the market and refinance or put new financing on for certain deals. If the M&A environment is becoming better, that will help, of course, as well. So those are some of the elements that go into the mix. Again, I can't predict when that's all going to happen, but we all know at some point that, that environment will improve again.

Yes. And just to be clear, it's really the high-yield market and the leveraged loans market that's an issue from your perspective. If we think about structured finance or we think about public finance, like that's -- has anything changed with respect to what you had talked about earlier?

Well, we see investment grade also a bit weaker than we have seen last year. Structured depends again which category under structured finance. So I definitely don't want to say that those markets are strong at this moment. But they're not as extreme as high yield and leveraged loans. Of course, we'll also see there issuers coming back because at some point, when we will see more confidence in the market, of course, timing-related questions with respect to our treasury yields developing, all of that plays a role there as well. Your question about 2020, 2021, what is normal? I think with the scenario that we put out today and the suspended guidance, but that scenario for the Ratings business bring us back to 2019 niche levels. But again, there's nothing in our view that has changed fundamentally. This is a business where the algorithm is still the same, that markets grow with growth of economies. GDP growth plus pricing plus new products, that is ultimately the longer-term formula. We've seen quite exceptional years in 2020 and 2021. But I think going back to that underlying algorithm and formula, I think from our perspective, nothing has changed there from a medium and long-term perspective.

Yes. Okay. And then just the high 50s margin that you talked about, does that assume -- are you taking any action inside the organization? Or does that assume that you're sort of running the business as is? Are you embedding any offsets? How should we think about that margin level?

Well, my answer to that question is related to what I said before because we believe, fundamentally, there's nothing that has changed with the company. The fundamentals are strong, are still there, and the fact that we are executing on a very clear plan for the combined company means that, yes, there will be some expense offsets. Of course, we are disciplined around discretionary spend. There will be some variable expenses, commissions and incentives that are more formulaic and will be adjusted. Of course, we are looking at cost synergies and perhaps see an acceleration of cost synergies if possible. But we're not going to take big restructuring actions because we want to preserve the franchise. This is coming back. We have to make sure we're in a good position from a company perspective in order to grab the opportunity once the market becomes stronger again. So we don't want to do anything that will damage the value of the franchise from a medium and long-term perspective.

Okay. Great. Okay. I'll move on from issuance.

Thank you. Thank you so much.

Maybe we can just talk about, obviously, you've embarked on this big merger integration. Just walk us through sort of where you are in the process. How is the integration going? You mentioned acceleration of cost synergies, maybe talk a bit more about that.

Yes. Well, first of all, Faiza, we are really enthusiastic about the combined company and how it's going. I think, first, it starts with people and culture. Because we know on paper, every large deal strategically can make sense, but where it usually goes wrong is social issues and cultural issues. And culture actually, it really feels good. How the team is coming together, how we operate, how we interact. I had, for example, a group of 50 leaders together last week. And you wouldn't be able to see or understand if you didn't know the people in the room, who was coming from originally IHS or originally S&P or completely new people. It's very natural, how everyone was interacting and behaving and -- which gives me a really good feel. And I've had many of those instances in different parts of the world when I was traveling over the last few weeks where the same impression really came up. And I think that's the most important. If it's very natural, if people get along well, if the way how they operate is very similar, I think that is a very positive indication. On the business side itself, I think we are making great progress with the integration. We, of course, had a couple of additional months waiting for the antitrust approvals to get ready and prepared. So the flip side of that waiting period was that we had more time to get ready. And I think we're really on a good track. I can sincerely say nothing major has gone wrong, which is really remarkable for something as complex as putting these 2 large companies together. So, so far, so good, and we're actually quite happy. A big part of that is around major system integrations to really operate as one combined company together. And then with respect to running the company together in the businesses and the divisions and the synergies around it, I'm very pleased what I'm seeing from the progress for cost synergies. We're well on track in all the main categories, if it is the people or procurement or real estate or other categories. And I think some very encouraging first signs with respect to revenue synergies as well. That's early days, but anecdotally, some nice positive signals that we are getting. So yes, I think we are very enthusiastic, and we're very happy. So far, so good.

Great. Great. Maybe talk about those early good news that you're talking about on the revenue synergy side. I know you talked about some of this as part of the announcement and as part of the completion of the deal. Where are you getting the most traction on the revenue synergy side?

Maybe I can start with telling you a short anecdote. Because I was, a couple of weeks ago, in Singapore, visiting our office there again after maybe 2.5 years. And I had the opportunity to do multiple customer visits, about 7 customer visits, some for Market Intelligence and some for Commodity Insights. And it was the first time I was really going to customers with a group of colleagues that were coming from both sides of the business originally. And it was just a lot of fun to sit there at the table and hear them talking about all the different things that we can bring to the table and being very proud of what we can offer now to customers, both in the commodity space and in the, for example, the banking space with some -- or asset management space with some customers in Singapore. So that was, just for me, a very nice proof point of we have a lot to offer, and I think we can create a lot of value for our customers. Maybe to give you a couple of examples around some quick wins. We had, for example, a large European financial services customer that has decided to use Cap IQ Pro for aftermarket research going forward, replacing an incumbent peer of us, and that was due to help, commercial relationships, from the other side of the company. So that is one example where, clearly, that is helpful. Another example is a product that we launched, an index product was developed together with the Mobility business, which is around EV metal index, so metals that go in the batteries of EVs, and a special index was developed around it in a combination of both companies. A third example is climate analytics. We see a lot of interest with customers in climate analytics, which is clearly a positive as well. And the last is I'm hearing a lot of feedback from customer interactions where a lot of customers are telling us, "What more can you do for us going forward?" So I think that's a great question because we now have the combined offering. But if they are thinking, "You're now in a position to help me more than what I was used to see from you going forward," I think that's a great starting position for a dialogue. So I think very, very nice indicators.

Great. Great. Just on -- you mentioned Cap IQ Pro, and I was going to ask you about that because I feel like you had been talking about that product. I believe it was rebranded a couple of years ago. But then we haven't really heard too much about it. So I'm glad that you brought it up today. So talk more about -- like has anything changed with the product now that you are -- now that IHS is part of the mix? Talk more about the traction that you're seeing there.

Not so much has changed in the overall direction. So we're continuing to develop Cap IQ Pro, adding more features, more functionality, more data sets. Most of the new data sets that we're bringing in, we're putting on Cap IQ Pro, not on Cap IQ, so clearly, to develop Cap IQ Pro as the platform of the future. And then over time, we can help customers to move over to that. I think it is an important platform for the business. And the good thing of the merger is IHS Markit didn't really have a platform. So they have a lot of data sets, a lot of pricing data and other data, and we can use our platforms to really embed that data, have a richer platform, more need to have data, deeper verticals and, in that way, to be more sticky with our customers. And at the same time, IHS Markit, the financial services, now part of Market Intelligence, has been originally more focused on workflow tools and workflow tools to be more embedded in the workflow of the customers. We didn't really have those. But combining data with workflow tools also really getting embedded in the day-to-day of users is an important part of really adding value to the customers and being more sticky. So I think both sides, actually, of Market Intelligence are really strengthening each other.

Yes. Yes. Talk more about Market Intelligence as a whole. Because it feels like some of your competitors are talking about analytics growing at a much higher rate than what you have talked about as we think about sort of your long-term growth framework in that business. Talk about the competitive dynamics there and sort of how unique your offering is versus others in the marketplace.

I think that market has always been competitive. So nothing has changed there, which is actually a positive, because it means you have to stay sharp, you have to be on top of your game, you have to make sure you develop new things very quickly and make sure that you add value to customers because a lot of the basic fundamental data over time gets commoditized. And you need to make sure that you have specific data, deep proprietary data that are very important for your customers so that those customers really have to stay on your platform. And that's a strategy we have always been developing, for example, deep retail data or insurance or metals and mining, technology, research. But now we have with IHS Markit additional data sets that we're able to add. Of course, a lot of the pricing data, CDS, bond prices, but also think about automotive data that can be added and several other data sets. So we have the opportunity with everything we now have in-house, plus, of course, the scale and the benefit of being able to make large investments in technology and other areas with the scale of the company to have a very rich set of solutions for our customers. And we think that's going to be a big benefit for us going forward.

Yes. Yes. Great. Can you talk more about what are you seeing from a pricing perspective? Obviously, inflation has been a big topic. Is that -- are you able to take pricing in the current environment? Maybe talk about your end markets and their ability to take on higher pricing.

In general terms, you know our philosophy. We have to be always balanced from a pricing perspective. And balancing out customer value with also the economical value at the same time. And what I mean with that is we have benchmarks and need to have data that we want to make sure that we are going gradual in terms of a pricing -- from a pricing perspective with our customers and don't go too fast because we have to make sure that it is in relation to the value that we generate for our customers as well. Obviously, in the current environment, we see increases on our own cost price. So obviously, when we have opportunities to pass that on in terms of price increases, we will do that. And this is, of course, clearly from the center in terms of our thinking about pricing. But at the same time, we'll also -- like I said, we need to be balanced because we are in this as a long-term player, long-term value generation. And we need to make sure that we do this in a way that is gradual and careful and making sure that it is appropriate to what we do and the value we add for our customers. But you will see us across the board, of course, making the adjustments as what is deemed appropriate.

Okay. Are there particular areas of the business where you see more of a pricing opportunity versus others?

No, I think it's pretty similar across the board.

Okay. Okay. Maybe we can pivot to like your Index segment and talk a little bit about how that's -- well, one, how it's evolved with the integration of the INFO deal. And also, there's obviously been some volatility in the equity markets. How do you think about that, both in the short and the long term?

Yes. I always say, if I'm being asked that there could only be one strategic reason to combine our business with IHS Markit, I would have said it is the strategic rationale about the Index business. I think that is so incredibly powerful that I'm so enthusiastic about the combination of equity indices and fixed income indices, what we can do in the future together because there is no large index provider, as you know, that is strong in both areas. And these markets are very different from a dynamics perspective. So therefore, you see very different players being large in equity indices versus players being large in fixed income. We have now leading franchises in both areas. Why does that matter? Because a lot of customers are interested in multi-asset class indices. And we have now all the pieces together to do that. For example, an insurance company that is looking at a custom index for an index universal life or an index annuity, we can develop that now in-house and based on key indices we have within the franchise. On top of that, we are really investing in that business right now, about multifactor indices, thematics, ESG, of course, indices. So there's a lot of things going on, and that business has a lot of now positive dynamics with respect to innovation and new business growth that we can see going forward. So yes, I really like that we're taking this more traditional equity index, big benchmarks to a business where the number of swimming lanes are expanding quite rapidly, which is really important strategically to make sure that we are not too dependent on 1 or 2 swimming lanes going forward.

And are there offsets as we think about the current environment and just the volatility in the market and potential sort of AUM declines?

Yes, of course. So think about it in a way that the part of the business that generates fees over assets under management, which is about 2/3 of the revenue base. Obviously, when the average asset levels are down, also, those fee levels will come down. The offset is that another significant revenue stream we have in this business are exchange traded derivatives. And with heightened volatility, we see more ETD volumes happening in the markets. It's not a perfect hedge. It's not a perfect offset. I would say there's a little bit of market impact on this business but overall, relatively modest from a company perspective, certainly in the overall scale of the company. So again, going back to the suspended guidance, that was, therefore, so much related to the Ratings business only. We wouldn't have done anything for any of the other 5 businesses, including the Index business.

Okay. Okay. You mentioned ESG. Obviously, there's been a lot of focus around ESG. Maybe talk about -- you've talked about it as a growth driver. Talk about where you see the business going forward, especially in an environment where there's potentially increased regulation around ESG. How do you see the market evolving?

Yes. Actually, we are a business that is already very used to deal with regulation. As you know, many of our businesses are regulated today. And we have processes, controls, compliance, segregations and so on in place to operate in a regulated environment. So we would be very much prepared and ready to also see more regulation in the ESG business. Actually, we would welcome it for the reason -- is that if you look at the markets, there's 2 big questions that the market needs to solve: one is quality of data, underlying data; and the other is lack of standards. We very much are focused on helping the markets with both. We think quality of data, we are able to get more detailed insights in terms of what companies actually are doing, for example, through our Corporate Sustainability Assessment, or CSA, survey that is being sent out already for a very long period of time by SAM, which is an entity we acquired a few years ago. Now 2,200 companies that are submitting the data and growing very rapidly. And then, of course, we have also ratings analysts that have access directly to companies' management in normal course but, of course, get also more insight about companies' plans on ESG. And then I think in terms of standards, given the fact that we are touching market participants so many ways, we think we can help market participants to migrate to standard. So the fact that what the regulators want to go, what the markets are looking for and what we can bring to the table is very aligned. So we think actually that this will be very much, in terms of direction, be helpful for us.

In terms of the survey data, is there a risk that some of that data at least is required by regulation to sort of your value add? Like is there a risk that, that becomes commoditized from your perspective? Or do you think it's really unique?

Yes. But you could say that's the case for many of our businesses. A lot of the raw data is generally available. It is the intellectual property that you built on top of it, the interpretation, the assessments, the methodologies, sometimes the human judgment that is applied on top of it in order to create a product. So nothing of that is different than what we see in many of our businesses. So with ESG, that's fine as well. I think the fact that we would be able to give all the underlying scores, so not only a main score on an E and an S and a G, but every element that goes into it and all the subdata and the source data behind it. That is something that I think a lot of market participants are looking for today. And if you want to give another waiting on those elements because you have another perspective on what is important, you can do that as well. So we will be able to provide those kind of insights that we think are very helpful for market participants.

Yes. Yes. Maybe just on the Commodities business. I think that business has been doing fairly well recently. Talk to us about how -- like does it -- I think it typically does well when oil prices are volatile and high. Talk more about the cyclicality of that business, I guess.

Yes. Well -- and they are -- it's the different parts of the business where we need to look at. But you're absolutely right. This business is doing well. We see a lot of positive commercial momentum. It's seeing high organic growth. So in a very positive phase despite the fact, by the way, that, that is a business that, of course, see some headwind from Russian sanctions, overall, not material for the company. But actually, they are able to overcome that to a large extent based on all the positive trends that are happening. I need to go 1 or 2 layers deeper to say what are some of the market drivers. I think one source of revenues is pricing. So that's the price reporting business that's probably the most stable of all of the business. Because we sometimes say, you need to have access to all of the 12,000 prices we put out every day if you are active in this business because it's embedded in your contracts, it's embedded in everything you do. So usually, that is something that is very steady and stable, and you have seen Platts performing very well in every market cycle for the commodity space. Then you have pricing -- sorry, analytics and data. This is the second category, probably relatively stable, but there might be some element to it that is a little bit more discretionary and might go up and down but generally, also quite stable. The third category is upstream. Upstream has been a business that has been very much under pressure. This is a part of the old ENR of IHS Markit. We knew that, that was going to bottom out during our due diligence phase, and actually that happened during the course of last year. And that business actually is performing quite nicely now, of course, helped by higher commodity prices, a change in the environment, more CapEx spend by some of the producers in that space. So you see that, that business, wouldn't it not for the Russia impact, the business actually would have shown growth in revenues over the last quarter. And then the last part is advisory and transactional. Particularly transactional, you would see doing very well when there's more volatility because this is global trading services where you see more hedging activity on commodity prices in high volatility environment. So that is actually a revenue stream that is going up during this period of time. So again, it depends very much. It's a mix. But overall, I think it's a very healthy mix of activity that we are seeing.

Yes. And then you talked about energy transition and just with the combination of your data and the data that INFO has, how you're able to help with energy transition. Talk about that and what you're doing from that perspective.

Yes. We are extremely excited about energy transition because ESG, climate, energy transition are 3 very big buckets, of course, very closely related to each other. But we know the world is looking for energy transition. A lot of our customers are having those questions about they put a net-zero target out but have difficulties to get there or large energy companies that have made public commitments about transition but need to develop underlying plans how to get there. And we have a lot of expertise within the company, for example, about clean energy technology that we can put forward or other insights that we can put forward. We have launched a lot of price assessments in this area about carbon, about hydrogen, but even about areas like recycled plastics. So actually, if you look from an overall ESG revenue perspective, Commodity Insights still today is the largest contributor of our ESG revenues. The other segments are growing fast. So it's a healthy competition. But they are doing very well, and that's because they play -- Commodity Insights plays a very strong role in this whole energy transition.

Okay. Maybe there's -- obviously, on the one hand, there's talk about inflation, and then there's potential talk about a recession over the next 12 to 24 months. Talk about how resilient you think your business is in a recessionary scenario. And we did talk about pricing before, but maybe sort of your ability to take price in that environment.

Yes. Well, 4 of our 6 businesses are subscription businesses. Those businesses obviously are not completely immune for an economic downturn but will be relatively well insulated. And if there is an effect, it's usually a delayed effect that you see taking place because some of those contracts are 1-year, 2-year, up to 3-year contracts. So you see some of that effect coming in over time. So that's a benefit. About 76% of our revenue base in total for the company is recurring. So that provides, I think, a very good level of stability. I wouldn't say that in every business, everything is subscription-like. So there is, for example, a small part in Market Intelligence, which focus on capital market activities. So origination platforms about equity and debt capital markets. So there's a little bit of pressure there. So this is a business called the Enterprise Solutions from a revenue stream. We saw that, for example, last quarter growing 2%. So there's a little bit of that. But in general, those 4 divisions are -- will be able to deal with an economic downturn quite well due to the business model. We discussed the indices already with the inherent hedge that is in that business, and there's a little bit of a subscription part as well around data. So it's not a perfect hedge. But in general, over the years, we have seen the Index business doing well in all kind of different economic cycles. So there might be a little bit of impact, but relatively modest. And we already discussed the Ratings business. But again, I would like to point out that's 1/3 of our overall revenues, and if you take out nontransaction, is about 1/6 of the revenue base of the company is actually transaction. So I know it's a big spotlight today by everyone. But in the bigger scheme, I think we're proving the benefit of the merger from a diversification perspective. And then we discussed some of the pricing. So definitely, we will be looking at opportunities for pricing. But when customers hit financial difficulties, obviously, we are mindful of that as well. We have those relationships for the long term. So that's, again, a case-by-case assessment, what is the right thing to do.

Yes. Yes. We didn't talk about like the engineering and mobility businesses. I know they're pretty small for you. But I know there's a lot of sort of end market dynamics going on in those 2 segments, supply chain issues, things like that. Talk about what's happening there. And also, like how does it fit into your portfolio? Like is it something that's a key important part of your portfolio? Or is it something that -- how important is it?

Yes. Both are phenomenal businesses. The first is mobility. This is all around the OEMs, the car manufacturers, the dealers, financial services companies, all around supply chain, predictive analytics with respect to sales, marketing, data around maintenance, about fin, about many different elements that are important for all of those different customer groups. Growing in a very healthy way. And what I'm particularly excited about is we didn't call this automotive. We call this deliberately mobility because there's so much going on in the world of mobility and where this is going that the opportunity to expand this and to provide a lot of new business activity and innovation in this area will be really very large. We already discussed EVs, but think about autonomous vehicles, think about rideshare, think about, perhaps at some point, human drones or other things, other forms of mobility. So that business, there's a lot where you can take it. Engineering Solutions is a data and insight and analytics business for the engineering community in the world, 650,000 users. So it's a really significant business around standards, codes, specs, and we provide platforms for engineers to get access to that data so they can take that into consideration where they are working on designs. That's a business where also we're investing in future growth. Because today, that data is quite static, and we're trying to link it and make it more dynamic with artificial intelligence so that there's less manual work needed for our customers. And the codes and standards are really more dynamically related to each other. So for example, if one element of a part would -- has to be replaced, that automatically becomes clear what other parts of the design need to be updated. So both businesses have actually really attractive features for innovation and growth. Your question from a portfolio perspective. At this moment, we say every business has a position in our portfolio, has an opportunity to prove itself. I think the most important is how can every business show what it can do for the enterprise and creating enterprise value across the board. We have to get to know these businesses better and see how there are cross relationships. And there are some that can be really attractive. Let me give an example. The ratings analysts are now using the automotive data from the Mobility division. They used to have access to data from another provider. And actually, they love our own internal data sets, think it's much better. That's an example. I already spoke about the EV metal index. But then over time, of course, we need to determine what is really a good fit in the portfolio. You know that we are always very disciplined portfolio managers. We always have to ask ourselves the question, are we the best owner for any asset? So for the time being, this is all part of our portfolio. And then over time, we would draw conclusions. But we will do that anyhow, and we do that always, and that's a normal course of business and management philosophy for us.

Yes. Okay. Maybe we'll end with -- you mentioned portfolio management. Maybe we'll end with sort of your capital allocation. Well, one philosophy and sort of how do you think about -- we know about the share buyback program. I think you mentioned in the press release that nothing has changed from that perspective. But maybe just confirm that for us. And then secondly, talk about just M&A. Where do you go from here? Is there any appetite to do more deals potentially on the smaller side? Are there any holes at the moment that you'd like to plug?

Yes. Maybe I'll answer the M&A first, and then I'll come back to the capital allocation. So for M&A, we're not looking at any large M&A. We need to be focused on making sure we're successful with the integration, being successful with the financial targets we have set for ourselves and delivering on that over the next few quarters and years. So I think that's the most important, and everyone is focused on that. There might be smaller tuck-in and bolt-on, if there are very specific areas where it makes sense to add certain specific skills and capabilities. For example, in the ESG space, that could be helpful. But again, those would be relatively smaller plug-ins that we would be looking at. So to your first question, yes, I think our intention is, at this moment, to continue with our $12 billion share buyback program for this year, and nothing has changed with our plans compared to what we announced a couple of months ago. And actually, if I may bring that back to a more generic statement, I think actually that's going to be really helpful for the company over the next period because in my view, we will look at S&P Global in a few months or a few quarters from now in a way of we focused on the fundamentals when there was a lot of noise in the external environment. We are focused on our own execution plans. We are delivering on the value and the synergies that we can deliver. At some point, the headwinds for the Ratings business will disappear. We take a big benefit from the share buyback because, obviously, we're taking many more shares out at this moment due to the share price. And then we come out of it, and we have all that upside of the company over a much smaller share base. I think that's going to be a really attractive proposition. So that's what we are focused on as executive team, focused on the fundamentals, executing on our plans. We very much believe in it, and then I think we will come out of this in a much stronger way.

Great. Excellent. Well, thank you so much. Really appreciate your time.

Thank you so much.

Thank you.