nteractive Data Corporation Reports Revenue Increase of 16.4% and Net Income Increase of 13.9% in Third Quarter of 2003

Diluted Earnings Per Share Rise 11.8% to $0.19

BEDFORD, MA - Interactive Data Corporation (NYSE: IDC) today announced  results for the third quarter ended September 30, 2003. Revenues increased 16.4% (or 15.5% before the effects of foreign exchange) to $111.3 million  from  $95.7 million for the third quarter of 2002. Net income rose 13.9%  to $18.0 million, or $0.19 per diluted share, from $15.8 million, or $0.17 per diluted share, in last year's same period.

Stuart Clark, president and chief executive officer, commented "Interactive Data  Corporation  delivered  a  strong  financial performance in the third quarter  and  made good progress in all aspects of integrating the ComStock business.  Net  income  rose  by  13.9%  in the third quarter, bringing the increase in net income for the first nine months of 2003 to 23.6%.

"Although the overall market conditions we experienced in the third quarter remained  weak, we did see a strong increase in the level of new sales, and some early signs from customers that the funding of new investment projects could  improve  in  2004. New sales in the third quarter were significantly better  than  in  the  first two quarters and September was by far our best sales  month  so  far  in  2003.  This  improved  level of sales was driven primarily  by  the  success  of  our Fair Value Information Service, and by sales  of our other high value products such as evaluated pricing of thinly traded  securities.  Our eSignal business also had a strong quarter for net new sales.
 
"Countering  our  strong sales performance was a continued focus by clients on  reducing  cost,  and  this  resulted  in our seeing the same pattern of higher  than  usual levels of service cancellations and downgrades, that we have  been experiencing all year. Our European business was the hardest hit in  the  quarter  due to continued softness in that market. Overall renewal rates in our institutionally oriented business remained at the 95% level.

"The  ComStock  business  that  we  acquired  at  the  end of February 2003 continues  to meet our revenue expectations, and the process of integrating its  operations into the rest of Interactive Data is well under way. During this  past  quarter,  we  commenced  the  build-out of a new data center in Boxborough,  MA  that  will  become the primary center for our company, and will allow us to reduce the five processing centers we now have in the U.S. to  two.  ComStock has become an integral part of our service offering, and its  comprehensive  coverage  of  real-time  markets  was  a  key factor in Moneyline   Telerate   selecting  us  as  their  primary  data  partner.  A non-binding  letter  of  intent  was  signed  and announced during the past quarter  that  envisages  their  using  a  wide  range  of our fixed income end-of-day  and  real-time  content,  and  other  services.  We  expect the services  to  be  implemented by Moneyline Telerate over the course of 2004 and  to  result  in  a  new multi-million dollar annual revenue stream. The relationship remains subject to the finalization of a definitive contract.

"As  we reported last quarter, our balance sheet and cash position leave us well  placed  to consider acquisition opportunities capable of accelerating the  development  of  our  business  in the areas of higher value products, relevant adjacent markets and geographic expansion."

Other Third Quarter Operating and Financial Highlights

The  ComStock  business  contributed  $15.9 million in revenues in the third quarter, which was in line with our expectations.

The FT Interactive Data business experienced a small overall reduction in  revenue  compared  to last year's third quarter. In North America, revenue  decreased  by  0.8%  due  to  the higher than usual levels of service cancellations and downgrades. In Europe, revenues decreased by 3.3%  (6.9%  before  the  effects of foreign exchange) due to the same trends  that  affected North American revenues, plus the fact that the 2002  third  quarter  contained approximately $0.5 million of once-off revenues.  However,  Asia-Pacific grew 28.6% (12.6% before the effects of  foreign exchange). New sales were strong across the FT Interactive Data  business,  and  in North America the number of users of the Fair Value Information Service rose from 12 to 20 during the quarter. CMS BondEdge revenues increased 1.7% compared to last year's third quarter.

eSignal revenues increased 9.9% compared to the same quarter last year. During the quarter, the number of subscribers to the newer, Internet-delivered product reached an all-time high of almost 48,000. As expected, revenues from products delivered by broadcast, which is no longer the delivery method of choice, declined by $0.6 million. Due to the ComStock acquisition, total costs and expenses for the third quarter rose by $12.1 million, or 17.2%, compared to the third quarter of 2002. Without the acquisition, total costs and expenses decreased by approximately 4.3% due to cost savings realized through the integration of the Securities Pricing Service acquired from Merrill Lynch.

We are closing our index calculation unit in Edinburgh, Scotland at the end of December due to FTSE International Ltd. having withdrawn all rights for its indices to be used as the basis for the provision of customized index data. This unit will have generated just under $4.0 million of revenue in 2003. The severance and lease write-down costs resulting from the closure will be no more than $0.9 million, with $0.2 million incurred in the third quarter of 2003.

Nine Month Results

For  the  nine  months  ended September 30, 2003, Interactive Data reported revenues  of $322.3 million versus $278.6 million for the comparable period in  2002,  an  increase  of  15.7%. Total costs and expenses rose 13.2%, or $27.4  million,  from the comparable period in 2002. Income from operations increased  23.2%  from  $70.5  million  in the first nine months of 2002 to $86.9 million for the comparable period in 2003. As a result, for the first nine  months  of  2003, net income rose 23.6% to $54.0 million or $0.57 per diluted  share  from  $43.7  million,  or  $0.47 per diluted share, for the comparable period in 2002.
As  of  September 30, 2003, Interactive Data Corporation had no outstanding debt  and  had  cash  and  cash  equivalents  of $123.6 million. During the quarter,  the  company  did  not  repurchase  additional  shares  under its existing buyback program.

2003 Outlook

We are maintaining our previously announced expectations for revenue growth in  2003 to be approximately 17% and earnings per share growth to be in the middle  of  the  15-19% range. We continue to expect our effective tax rate for  2003  to  be 38-39% and our 2003 capital expenditures to range between $21-$23  million.  We  point  out,  however,  that  the  worldwide economic recession  and  political  conditions continue to have an adverse impact on the  financial  markets  that we serve. Consequently, if such conditions or their impact worsen, our view of the company's 2003 outlook could change.

Conference Call Information

Interactive  Data  Corporation's  management will conduct a conference call Thursday,   October   23,  at  11:00  a.m.  Eastern  Time  to  discuss  the third-quarter  2003  results and additional matters. The dial-in number for the  call  is  706-634-1052;  no  access  code  is  required. Investors and interested  parties  may  also  listen to the call via a live web broadcast available  through the Investor Relations section of the company's web site at www.interactivedatacorp.com and through www.StreetEvents.com. To listen, please register and download audio software at the site at least 15 minutes prior  to  the  call.  A replay will be available on both web sites shortly after  the  call.  In  addition,  a telephone replay will be available from October  23 at 2:00 p.m. through Thursday, October 30, 2003. The replay can be accessed by dialing 706-645-9291, conference ID #3101923.

Forward-looking and Cautionary Statements

This  press  release contains certain forward-looking statements within the meaning  of  the  Private  Securities Litigation Reform Act of 1995, and is subject  to  the  safe-harbor created by such Act. These statements include our  statements  regarding  the  Moneyline  Telerate  relationship  and its revenue  potential,  our plans to reduce our number of U.S. data processing centers  from  five  to two, the impact of the end of our relationship with FTSE International, our belief that we have seen early signs from customers that funding for new investment projects could improve in 2004, our ability to  accelerate  the  development  of  our business in areas of higher value products,  relevant  adjacent  markets  and  geographic  expansion  through strategic  acquisitions,  our ability to continue to successfully integrate and  deliver synergies from strategic acquisitions, including ComStock, our expectations regarding the ComStock acquisition, expected revenue growth or declines,  and all other statements discussing future financial conditions, results  or  projections, including those appearing under the heading "2003 Outlook."  These  statements  are  subject  to  known  and  unknown  risks, uncertainties  and  other  factors  that  may  cause  actual  results to be materially   different  from  those  contemplated  by  the  forward-looking statements.  Such factors include, but are not limited to: (i) the presence of competitors with greater financial resources than us and their strategic response  to  our  services and products; (ii) changes in technology, which could  affect  the  competitiveness  of  our  products  and services; (iii) maintaining  relationships  with  our key suppliers and providers of market data;  (iv)  a  continuing  slowdown  or  decline in activity levels in the securities markets, which could lower demand for our products and services; (v) the impact of the difficult worldwide economic and political conditions on  the  financial  markets and the industries we serve; (vi) the impact of cost  cutting pressures across the industries we serve; (vii) consolidation of financial services, both within an industry and across industries, which could lower demand for our products and services; (viii) a prolonged outage at  one  of  our  data  centers; (ix) our ability to broaden our subscriber base;   (x)  difficulty  or  unexpected  complications  we  may  experience integrating  or operating the ComStock business; (xi) ComStock revenues may materialize  at  lower  than  expected  levels;  (xii)  a decline in market acceptance of our services or products or the potential obsolescence of our services   or   products,   including   due  to  the  introduction  of  new technologies;   and  (xiii)  the  failure  of  one  or  more  new  business initiatives.  We  undertake  no  obligation to update these forward-looking statements.

About Interactive Data Corporation

Interactive  Data  Corporation  is  a leading global provider of securities pricing,  financial  information,  and  analytic tools to institutional and individual   investors.   The   company   supplies  time-sensitive  pricing (including  evaluated pricing), dividend, corporate action, and descriptive information  for  more than 3.5 million securities traded around the world, including  hard-to-value  instruments.  The  company  links  to most of the world's  best-known  financial  service and software companies for trading, analysis, portfolio management, and valuation.
Interactive  Data  Corporation  is headquartered in Bedford, Massachusetts. Through   its  branded  businesses,  FT  Interactive  Data,  ComStock,  CMS BondEdge, and eSignal, Interactive Data Corporation has approximately 1,800 employees  in  offices  located throughout North America, Europe, Asia, and Australia.  Pearson  plc (NYSE: PSO), an international media company, whose businesses  include  the  Financial Times Group, Pearson Education, and the Penguin  Group,  owns  approximately  60  percent of the outstanding common stock of Interactive Data Corporation.

Further information

Company Contact      
Steven Crane         
Chief Financial Officer
(781) 687-8309
Steven.Crane@ftid.com                    

Media Contact           
Jeanne Murphy
Interactive Data Corporation
(781) 687-8548          
Jeanne.Murphy@ftid.com                       

Investor Relations Contact

 

Harriet Fried         

 

Lippert/Heilshorn & Assoc.

 

(212) 838-3777        


hfried@lhai.com