investor presentation...other forward-looking statements in this presentation are made as of october...

Investor Presentation 3Q 2014

NOVEMBER 4, 2014

2 November 4, 2014

Disclaimer

Certain statements contained in this presentation are forward-looking statements and are based on future expectations, plans and

prospects for Moody’s business and operations that involve a number of risks and uncertainties. Moody’s outlook for 2014 and

other forward-looking statements in this presentation are made as of October 29, 2014, and the Company disclaims any duty to

supplement, update or revise such statements on a going-forward basis, whether as a result of subsequent developments,

changed expectations or otherwise. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act

of 1995, the Company is identifying certain factors that could cause actual results to differ, perhaps materially, from those

indicated by these forward-looking statements. Those factors, risks and uncertainties include, but are not limited to, the current

world-wide Moody’s Market disruptions and economic slowdown, which is affecting and could continue to affect the volume of debt

and other securities issued in domestic and/or global capital markets; other matters that could affect the volume of debt and other

securities issued in domestic and/or global capital markets, including credit quality concerns, changes in interest rates and other

volatility in the financial markets; the level of merger and acquisition activity in the US and abroad; the uncertain effectiveness and

possible collateral consequences of U.S. and foreign government initiatives to respond to the current world-wide credit disruptions

and economic slowdown; concerns in the marketplace affecting our credibility or otherwise affecting market perceptions of the

integrity or utility of independent agency ratings; the introduction of competing products or technologies by other companies;

pricing pressure from competitors and/or customers; the level of success of new product development and global expansion; the

impact of regulation as an NRSRO, the potential for new U.S., state and local legislation and regulations, including provisions in

the Dodd-Frank Wall Street Reform and Consumer Protection Act and anticipated regulations resulting from that Act; the potential

for increased competition and regulation in the EU and other foreign jurisdictions; exposure to litigation related to our rating

opinions, as well as any other litigation to which the Company may be subject from time to time; provisions in the Dodd-Frank Act

legislation modifying the pleading standards, and EU regulations modifying the liability standards, applicable to credit rating

agencies in a manner adverse to credit rating agencies; provisions of EU regulations imposing additional procedural and

substantive requirements on the pricing of services; the possible loss of key employees; failures or malfunctions of our operations

and infrastructure; any vulnerabilities to cyber threats or other cybersecurity concerns; the outcome of any review by controlling tax

authorities of the Company’s global tax planning initiatives; the outcome of those legacy tax matters and legal contingencies that

relate to the Company, its predecessors and their affiliated companies for which Moody’s has assumed portions of the financial

responsibility; the impact of mergers, acquisitions or other business combinations and the ability of the Company to successfully

integrate acquired businesses; currency and foreign exchange volatility; the level of future cash flows; the levels of capital

investments; a decline in the demand for credit risk management tools by financial institutions; and other risk factors as discussed

in the Company’s annual report on Form 10-K for the year ended December 31, 2013 and in other filings made by the Company

from time to time with the Securities and Exchange Commission.

3 November 4, 2014

Table of Contents

1. Financial Overview

2. Moody’s Market Overview

3. Moody’s Investors Service (MIS)

4. Moody’s Analytics (MA)

5. Conclusion

6. Appendix

4 November 4, 2014

4

Overview of Moody’s Corporation

$2,213 68%

$1,023 32%

Moody’s TTM Revenue:

$3.2 billion

Leading global provider of credit rating opinions, insight and

tools for financial risk measurement and management

Research, data and software for financial risk

analysis and related professional services Independent provider of credit rating opinions

and related information for over 100 years

Introduction | Financial Overview | Moody’s Market Overview | Moody’s Investors Service | Moody’s Analytics | Conclusion | Appendix

38%

62%

Transaction Recurring

59%

41%

U.S. Non-U.S.

75%

25%


45%

55%

U.S. Non-U.S.

Revenue represents consolidated trailing twelve months ended September 30, 2014, excluding intersegment revenue and eliminations.

Note: Total MCO recurring and transaction revenue split is 50/50; U.S. and Non-U.S. revenue split is 54/46.

5 November 4, 2014

Financial Overview 1

6 November 4, 2014

Revenue Growth, Operating Leverage and Balance Sheet Management Provide the Opportunity for EPS Growth

Potential Operating Income Margin Expansion

Ongoing Share Repurchases*

Long-Term EPS Growth Opportunity: Mid-Teens % (on average)**

Long-Term Revenue Growth Opportunity: Low Double-Digit % (on average)

*Subject to market conditions and other ongoing capital allocation decisions.

**Assumes no material change in effective tax rate, leverage profile and/or capital allocation policy.

Introduction | Financial Overview | Moody's Market Overview | Moody’s Investors Service | Moody’s Analytics | Conclusion | Appendix

Debt market

issuance driven

by global

GDP growth

~2-4%

Disintermediation

of credit markets

in both developed and

emerging economies

driving both issuance

and demand for

new products

and services

~2-3%

MA and MIS pricing

initiatives aligned

with value; affected by

business volumes and

mix

~4%

Growth in Moody’s

Analytics driven by

further penetration

of MA’s client base and

expansion of bank and

insurance risk

regulatory

requirements

~2-3%

7 November 4, 2014

Moody’s Has Consistently Delivered Strong Performance Over a Challenging Global Economic Period

Operating Margin Performance 5-year Average Free Cash Flow Conversion***

Non-GAAP EPS Revenue

$0

$1,000

$2,000

$3,000

$4,000

2009 2010 2011 2012 2013 2014F*

$ M

illio

ns

Corporate Finance Structured Finance Financial Institutions

Public, Project, and Infra Moody's Analytics

Low

double-digit

% growth

$0.10

$0.21

$0.30

S&P 500

SelectPeers****

Moody's

$1 of

Revenue

38.3% 38.0%

39.0% 39.5%

41.5% 42.8%

41.3% 42.4%

43.3% 44.7%

35%

40%

45%

50%

2009 2010 2011 2012 2013 2014F*

Operating Margin Adj. Operating Margin**45.0%

to

46.0%

42.0%

to

43.0%

*Guidance as of October 29, 2014.

**Adjusted Operating Margin is a non-GAAP measure. See appendix for reconciliation from non-GAAP to GAAP.

***As of September 2014, over last five available fiscal years. Source: FactSet.

****Includes CLGX, DNB, EXPN, FDS, IHS, MHFI, MORN, MSCI, TRI, VRSK. Source: FactSet.


$1.70

$2.13 $2.46

$2.99

$3.65 $3.95

to $4.05

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

2009 2010 2011 2012 2013 2014F*

8 November 4, 2014

Share Repurchases and Dividends Paid

Moody’s has a Disciplined Approach to Capital Allocation and Continues to Return Capital to Shareholders

*Guidance as of October 29, 2014. Subject to market conditions and other ongoing capital allocation decisions.

$224 $334

$197

$893

$780

$95

$99 $121

$143

$197

$178

200

205

210

215

220

225

230

235

240

$0

$200

$400

$600

$800

$1,000

$1,200

2009 2010 2011 2012 2013 YTD 3Q14

Mill

ion

s o

f S

ha

res

$ M

illio

ns

Share Repurchases (L)

Dividends Paid (L)

Share Count (R)

$323

$455

$1,090

$340

$95


» Expect approximately $1.25 billion in share repurchases in 2014*

» Current annualized dividend rate of $1.12 per share (YTD 3Q14 payout of 24% of net income)

– Dividend per share CAGR of 23% from 2009 –2014 annualized

$958

Return of Capital

» Dividend yield potential is

1.4% to 1.8%

» Dividend payout ratio

potential is 25% to 30%

Dividends

» Share repurchases on both

a programmatic and

opportunistic basis

» Average annual potential is

$750 million to $1 billion

Share Repurchases

Investing in Growth Opportunities

Reinvestment Acquisitions

» Invest in existing

businesses to support

organic growth

» Aligned with strategy

» Opportunistic; ideally able

to use offshore cash

9 November 4, 2014

» One of three leading India-based domestic rating agencies

» Moody’s increased its ownership stake from 28.5% to over 50.0% in June 2014

» A cloud-based lending platform that provides loan origination, credit analysis and

loan management functionality to ~750 financial institutions

» Moody’s acquired WebEquity in mid-July 2014

» Provides outsourced research and analytical services to the global financial and

corporate sectors

» Expect to purchase the remaining outstanding shares in 4Q14 pursuant to a call

option as described in our SEC filings

Successful Execution of Recent Transactions


» Provides analytical tools and data to issuers, investors and underwriters to

administer, monitor and value securitized transactions

» Moody’s acquired Lewtan in late October 2014

Approximately

$0.02 dilution

Approximately

$0.03 dilution

None

2014 EPS

Impact

Minimal

» 2014 combined revenue contribution of ~$150 million (run rate ~$180 million)

http://www.dowjones.com/factiva/

http://www.dowjones.com/factiva/

10 November 4, 2014

Well-Spaced Maturity Profile Reduces Refinancing Risk

$0

$100

$200

$300

$400

$500

'14 '15 '16 '17 '18 '19 '20 '21 '22 '23 '24 '44

$ M

illio

ns

Debt Maturities

//


» Moody’s current credit rating from S&P is BBB+

- Moody’s leverage metrics remain within S&P’s stated criteria for the current rating

» On July 16, 2014, Moody’s issued $750 million of unsecured notes in a public offering; uses of proceeds include

retiring its 2005 private placement notes (4.98% coupon), as well as general corporate purposes

- $450 million 5-year notes, at 2.75%, maturing on July 15, 2019

- $300 million 30-year notes, at 5.25%, maturing on July 15, 2044

- 2014 EPS dilution from retiring the 2005 private placement notes, as well as additional interest, is

approximately $0.04

10-yr notes

5-yr notes

30-yr notes

11 November 4, 2014

Moody’s Market Overview 2

12 November 4, 2014

Non-Financial Corporates Have Refunding Needs of Over $3 Trillion from 2015-2018

Debt Maturities: U.S. Moody’s-Rated Corporate Bonds & Loans

$147 $168 $162

$188

$29 $42 $66

$131

$19

$93

$143

$186

$0

$50

$100

$150

$200

$250

2015 2016 2017 2018

$ B

illio

ns

Source: Moody’s

Investors Service,

February 2014.


Debt Maturities: EMEA Moody’s-Rated Corporate Bonds & Loans

$184 $209 $202 $194

$38 $49 $54

$97

$44 $56 $47 $48

$0

$50

$100

$150

$200

$250

2015 2016 2017 2018

$ B

illio

ns

Source: Moody’s

Investors Service,

July 2014.

Debt Maturities: Asia Pacific Moody’s-Rated Corporate Bonds

$87 $90 $104 $80

$9 $11 $15 $18

$0

$50

$100

$150

$200

$250

2015 2016 2017 2018

$ B

illio

ns

Sources: Moody’s

Investors Service and

Bloomberg, July 2014.

Note: Data represents

rated and unrated bonds

of rated corporate entities

in Asia ex-Japan, Australia

and New Zealand. Data

does not include loans.

Investment Grade Bonds Speculative Grade Bonds Speculative Grade Bank Loans

13 November 4, 2014

*Recurring Revenue recognized ratably over security life (MIS) and over contract period (MA).

Moody’s Recurring Revenue Base Provides Stability

$0

$425

$850

$1,275

$1,700

2009 2010 2011 2012 2013 TTM 3Q14

$ M

illio

ns

Corporate Finance Structured Finance

Financial Institutions Public, Project, & Infrastructure Finance

Moody's Analytics

Recurring Revenue*

» Growth in RD&A

» Growth in ERS

maintenance

and subscription

revenue

MA Drivers

» Growth in

monitoring fees

driven by new

mandates

» Pricing changes

MIS Drivers


» High-single-digit % growth going forward

14 November 4, 2014


Bond Issuance Has Primarily Been Used for Refinancing; Recently, M&A Activity Has Noticeably Increased

Source: Moody’s Capital Markets Research Group.

*% of count of mentions for each respective period in bond issue or bank loan program tranche documents. Excludes Investment Grade issuance, issues of less than $25 million

and general corporate purposes.” An issue can have multiple purposes and, as a result, time period %’s for each category do not sum to 100%.

438%

227%

35%

-100%

100%

300%

500%

Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14

Buybacks

M&A

CapEx

Uses of Funds From USD High Yield Bonds and Bank Loans*

Growth in Buyback, M&A and Capex Activity: U.S. Non-Financial Corporates (Growth as a % of base period , TTM volume)

52%

83% 71% 74% 78% 80% 76% 66% 66% 70% 67% 57%

53%

19% 31% 30% 25% 20%

26% 37% 48% 40% 41% 53%

17% 11% 7% 8% 8% 9%

11% 8% 10% 7% 8% 7%

9% 4% 18% 17% 18% 16% 23% 24% 21% 23% 21% 19%

0%

20%

40%

60%

80%

100%

2008 2009 2010 2011 2012 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14

% o

f S

am

ple

Siz

e

Shareholder Payments

Capital Spending

M&A

Debt Refinancing

15 November 4, 2014

Changes in the Banking Sector Create Demand for Moody's Offerings


16 November 4, 2014

Disintermediation Continues in European Capital Markets


» European bank loans have comprised approximately 80% of the outstanding debt in Europe (bonds

approximately 20%)

» European companies have historically relied more on banks than their American counterparts but are

increasingly turning to the bond market over traditional commercial bank loans

» For comparison, the U.S. debt markets have been more evenly split between bank loans and bonds

Sources: ECB, BarCap Indices. Europe bank loan data includes Eurozone and UK bank loans. Europe bond data includes euro and sterling denominated bonds.

European Non-Financial Corporate

Bank Loans Outstanding

4

8

%

€4,000

€4,200

€4,400

€4,600

€4,800

€5,000

€5,200

€5,400

€5,600

€5,800

€6,000

€ B

illio

ns

European Non-Financial Corporate

Bonds Outstanding

4

8

%

€400

€500

€600

€700

€800

€900

€1,000

€1,100

€1,200

€ B

illio

ns

17 November 4, 2014

Growth in Newly-Rated Corporate Issuers


Annual Count of Newly-Rated Non-Financial Corporate Issuers*

Source: Moody’s Investors Service.

*Rated by Moody’s Investors Service.

**Through October 24, 2014.

0

200

400

600

800

1,000

2009 2010 2011 2012 2013 YTD 2014**

# o

f Is

su

ers

Europe U.S. Emerging Markets (ex-Europe) Rest of World

18 November 4, 2014

Growing Regulatory Requirements for Financial Institutions

Source: Moody’s Analytics market research as of April 2014.

1. In the EU, the Liquidity Coverage Ratio (LCR) will be implemented faster than originally envisaged under Basel III. The timetable will be: 60% by 2015, 70% by 2016, 80% by 2017

and 100% by 2018.

2. The higher loss absorbency requirements for global systemically important banks (G-SIBs) will be phased in from January 2016, with full implementation by January 2019.

3. In the U.S., advanced-approach banks and non-bank systemically important financial institutions (SIFI) institutions will have to meet 80% of the LCR by January 1, 2015 and 100% of

the ratio by January 1, 2017.

4. Insurance Capital Standard.

5. The new standardized approach (SA-CCR) replaces both the Current Exposure Method (CEM) and the Standardized Method (SM) in the capital adequacy framework.

Black: Banking

Blue: Insurance

Green: Buy-side and other

industries

EMEA

2014 2015 2016 2017 2018 2015 2016 2017 2018

CRD IV/ CRR CCAR /DFA ST

CRDIV B3 (IRB)

Basel 2

Global systemic

risk report

UK FDSF

Stress tests for

foreign banks

Review of

trading book

RBC 2 CROSS

SAM Solvency II

Solvencia II

SII-like P1

ORSA

AIFMD

MIFID II MMF Internal

Ratings/ST

EMIR

Group-

wide ICS4

COREP/

FINREP

ECB CA (AQR/ST)

IFRS 4,9

LCR3

LCR

G-SII BCR Int. Measures

SII Interim

Measures

CCAR /

DFA ST

LCR1

LCR1

Qatar Insurance

Prudential rules

IRDA RBC

BoE/PRA ST

(Top 8 banks)

BoE/PRA ST (Top 8 banks +

Mid sized + SIFIs)

CBRC ST

Adv. Approach Rule

Capital Planning

RBC

LCR

SA-CCR5

G-SII BCR

G-SII BCR

CCAR /DFA ST

G-SIB

Surcharge2

Leverage

Ratio

Leverage

Ratio

Leverage

Ratio

Review of

trading book

Vickers Reform

IFRS 4,9

ORSA

Supplementary

leverage ratio

Review of

trading book

RBC Rules

Higher B3

capital ratios

Basel 3 Capital buffers

G-SII risk mgt

G-SII risk mgt

G-SII risk mgt

LCR1

ORSA

G-SIB

Surcharge2

G-SIB

Surcharge2

LCR3

Capital rules to

large foreign banks

Group-

wide ICS4

Group-

wide ICS4

EIOPA ST

PRA Supervision

Int’l banks

CCAR /

DFA ST

FI/Riksbank ST

SA-CCR5

SA-CCR5


19 November 4, 2014

Historically, Rising Rates Have Not Had a Significant Impact on Moody’s Revenue

MCO Revenue & Interest Rates


Source: Moody’s Investors Service. *10-yr Treasury Yields are represented by the rate at the end-of-period.

5.8%

7.8%

5.6%

6.4%

4.7%

6.5%

3.8%

4.3%

2.3%

3.3%

1.8%

3.0%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TTM3Q14

$ M

illio

ns

Revenue: $M (L) 10-yr U.S. Treasury Yield (R)*

+80bps

+200bps

+180bps

+120bps

+100bps +50bps

20 November 4, 2014

MCO Revenue vs. Rated Issuance*

$1,797

$2,032 $2,281

$2,730 $2,973

$2,193 $2,457

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$0

$1,000

$2,000

$3,000

$4,000

$5,000

2009 2010 2011 2012 2013 YTD 3Q13 YTD 3Q14

Revenue $

Mill

ions

Issuance $

Bill

ions

Global Non-Financial Bonds and US HY Bank Loans (L) Global Financial Bonds (L)Global Structured Finance (L) U.S. Municipal Bonds (L)MCO Revenue (R)

Moody’s Revenue Does Not Directly Tie to Issuance

» In addition to issuance activity levels, Moody’s revenue is impacted by the mix of issuance activity, sales of

non-issuance related products (including by Moody’s Analytics) and pricing

*Rated global investment grade bonds, global high yield bonds, U.S. high yield bank loans, global structured finance, and U.S. municipal issuance.

Source: Moody’s Capital Markets Research Group, Dealogic, AB Alert, CM Alert, Thomson SDC. U.S. High Yield Bank Loans represent Moody’s rated new U.S. bank loan programs.


YOY % Change 2009 2010 2011 2012 2013

2009-2013

CAGR

YTD 3Q

2014

Issuance -1% -16% 2% 11% 1% -1% 6%

Revenue 2% 13% 12% 20% 9% 13% 12%

21 November 4, 2014

Steady Moody’s Analytics Revenue Growth Complements Variability of Moody’s Ratings Revenue


Revenue by Quarter – YoY % Change

-20%

-10%

0%

10%

20%

30%

40%

50%

Q1'0

9

Q2'0

9

Q3'0

9

Q4'0

9

Q1'1

0

Q2'1

2

Q3'1

0

Q4'1

0

Q1'1

1

Q2'1

1

Q3'1

1

Q4'1

1

Q1'1

2

Q2'1

2

Q3'1

2

Q4'1

2

Q1'1

3

Q2'1

3

Q3'1

3

Q4'1

3

Q1'1

4

Q2'1

4

Q3'1

4

MIS

MA

MCO

(2%)

3%

16%

1%

6%

19%

15%

5%

1%

22 November 4, 2014

Moody’s Investors Service 3

23 November 4, 2014

3Q14 Revenue: $543.1 million

Moody’s Investors Service Financial Profile

Public,

Project, &

Infrastructure

Finance

16%

Financial

Institutions

17%

Corporate

Finance

48%

Structured

Finance

19%

40%

60%


61%

39%

U.S. Non-U.S.


» 31% recurring revenue




» Global:

» U.S.:

» Non-U.S.:

» Corporate Finance:

» Structured Finance:

» Financial Institutions:

» Public, Project & Infrastructure:

Full-Year 2014 Revenue Guidance as of October 29, 2014

high-single-digit % range


approximately 10%

approximately 10%


mid-single-digit % range

mid-single-digit % range

24 November 4, 2014

» Over the past several years, an increasing percentage of the U.S. non-financial corporate speculative-grade bank loan

market has been rated

» The rated bank loan market is larger in the U.S. than in Europe, but Europe’s market is growing

FY 2013 rated bank loan issuance in the U.S. totaled $425 billion vs. $81 billion in Europe*

YTD 3Q 2014 rated bank loan issuance in the U.S. was approximately $331 billion vs. $99 billion in Europe*

U.S. Non-Financial Corporate Speculative-Grade Bank Loans*

Rated Bank Loan Issuance Continues to Grow

*Rated bank loan issuance represents Moody’s rated non-financial corporate speculative-grade bank loans.

Sources: Moody’s Investors Service


$0

$200

$400

$600

$800

2009 2010 2011 2012 2013 YTD2014

$ B

illio

ns

Rated* Unrated

Unrated – includes term

loan A (retained by the

lender) and revolvers

Rated – includes term loan

B syndicated loans (sold to

investors)

25 November 4, 2014

Emerging Markets Rated Corporate Bond Issuance*

Emerging Markets Issuance has Grown Substantially, but Will Remain Volatile

$0

$50

$100

$150

$200

$250

$300

$350

Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14

$ B

illio

ns

*Moving 12 month sum; includes rated investment grade and high yield corporate bond issuance (financial and non-financial).

Sources: Dealogic, Moody’s Capital Markets Research Group.


26 November 4, 2014

Moody’s Analytics 4

27 November 4, 2014

Full-Year 2014 Revenue Guidance as of October 29, 2014

» Global:

» U.S.:

» Non-U.S.:

» Research, Data & Analytics:

» Enterprise Risk Solutions:

» Professional Services

Research, Data and Analytics,

54%

Enterprise Risk

Solutions, 30%

Professional Services,

16%

Operating Margin

3Q14 Revenue: $273.0 million

Moody’s Analytics Financial Profile

73%

27%


44%

56%

U.S. Non-U.S.


» ~100% recurring revenue

» Mid-90s% renewal rates

» Approximately two-thirds recurring

revenue

» Combination of one-off contracts

and semi-recurring revenue

mid-teens % range

low-double-digit % range

high-teens % range


mid-teens % range

approximately 40% 16.8%

19.1%

18.0%

17.8%

17.5%

19.0%

20.5%

0.0% 7.0% 14.0% 21.0%

1Q13

2Q13

3Q13

4Q13

1Q14

2Q14

3Q14

» Expect operating margin to grow to the mid-20’s percent

range over the next several years

28 November 4, 2014

RD&A Revenue Has Grown Despite Flat Financial Services Employment

$300

$350

$400

$450

$500

$550

$600

$650

$700

5.0

5.5

6.0

6.5

7.0

7.5

$ M

illio

ns

Mill

ion

s o

f jo

bs

U.S. and U.K. Financial Services Employment (L)* TTM RD&A Revenue (R)

Source: U.S. Bureau of Labor Statistics and the U.K. Office for National Statistics.

*Reported as of June 30, 2014.


» Trailing twelve months retention rates have been in the mid-90s percent range for the past 8 quarters

RD&A Revenue

29 November 4, 2014

2012

2013

Y

TD

3Q

14

Reported Revenue

Growth

$39.5 million

8.7%

Reported Revenue

Growth

$38.7 million

7.8%

Reported Revenue

Growth

$38.8 million

9.9%

Sales Production by Year

Managing Growth in RD&A


95.5% 109.9%

1.2% 4.7% 8.6%

Retained Base Upgrades Price Increase New Sales Business Base30 Sep 2014

94.7% 107.4%

1.4% 4.9% 6.5%

Retained Base Upgrades Price Increase New Sales Business Base

94.1% 109.2% 4.1% 3.4% 7.5%

Retained Base Upgrades Price Increase New Sales Business Base

30 November 4, 2014

ERS Revenue by Type ERS Sales by Type

$0

$20

$40

$60

$80

$100

$ M

illio

ns

Maintenance Subscriptions License and Services

$0

$20

$40

$60

$80

$100

$ M

illio

ns

Maintenance Subscriptions License and Service

» Recurring Maintenance and Subscriptions revenue represents ~⅔ of total revenue; growing at 3-year

CAGR of 20%

» Non-recurring License and Service revenue drives variability in quarter-to-quarter top-line results

– Revenue recognized as implementation projects are completed

– Sales provide 12-24 months’ visibility into revenue

» Seasonal pattern

– Sales tend to be strongest in 1Q and 4Q, in line with customer budgeting/planning cycles

– Revenue is typically strongest in 4Q, driven by prior year’s sales and customer timelines for year-end

project completion

Renewable Book Growing, But Revenue Dependent on Project Timing


31 November 4, 2014

MA is Well-Positioned to Help Banks Manage their Stress Testing Requirements

Stress Testing is Becoming a Fundamental Part of

How Banks are Regulated

Americas

» All banks

>$10 bn in

assets

Europe

» 8 largest

UK banks

» ECB

testing 130

Euro area

banks

» To address regulatory

requirements to perform

enterprise-wide stress tests,

banks are undertaking extensive,

multi-year infrastructure projects

» Banks are also looking for ways to

leverage investments in stress

testing to better manage their

institutions

» MA is integrating existing product and service offerings to facilitate scenario-based stress testing:

– Econometric modeling expertise to develop relevant scenario parameters

– Unique benchmarking data sets to support better analytics across asset classes

– Credit and loss modeling, business forecasting expertise and calculation engines to project cash

flow, profitability, regulatory capital levels

– Auditable, repeatable, automated software platform and regulatory reporting capabilities


32 November 4, 2014

Copal Amba is a Market Leader in Analytics and Research Support Services

London

Beijing

Hong Kong

Dubai

New Delhi / Gurgaon

New York

San Jose,

Costa Rica

Bangalore

Colombo, Sri Lanka

Singapore

» Provider of research, analytics and business

intelligence services to global financial institutions

and corporations

» #2 player in the $1bn Third party pure play

Knowledge Process Outsourcing (KPO) market


Business Development Center Research and Analytics Center

» Equities,

Credit, Quants,

Marketing,

Compliance

Asset management

and private wealth

» Advisory, ECM,

DCM, Global

Markets

Advisory

» Origination,

Underwriting,

Portfolio

Management

Commercial

banking

» Primary

Research,

Business

Research

Corporates and

consulting

» Equities, FICC,

Research

Production,

Quants

Brokerages

33 November 4, 2014

Conclusion 5

34 November 4, 2014

Why Invest in Moody’s? » We strive to be the world’s most respected authority serving risk-sensitive

financial markets

» We have had strong revenue and earnings growth, as well as strong cash

flow conversion

– 2009 – TTM 3Q14 Revenue CAGR of 13%

– 2009 – TTM 3Q14 Non-GAAP EPS CAGR of 19%

– 2009 – TTM 3Q14 free cash flow conversion rate of 30%

» We are committed to returning capital to our shareholders

– Current annualized dividend of $1.12

– Anticipate total 2014 share repurchases of up to $1.25 billion (subject to available cash,

market conditions and other ongoing capital allocation decisions)*

» We will selectively invest in strategic growth opportunities

– Leverage brand to extend our relevance in financial markets

– Expand our product offerings and geographic influence



35 November 4, 2014

Appendix 6

36 November 4, 2014

Full-Year 2014 Guidance as of October 29, 2014

*Amount is a non-GAAP measure. See Appendix for a reconciliation of this non-GAAP measure to its comparable U.S. GAAP measure.

**See Appendix for reconciliation of GAAP to non-GAAP Earnings Per Share.

***See Appendix for reconciliation of Cash Flow from Operations to Free Cash Flow.

» Revenue: Low-double-digit % growth range

» Operating Expenses: High-single-digit % growth range

» Operating Margin: 42% to 43%

» Adjusted Operating Margin*: 45% to 46%

» Effective Tax Rate: Approximately 33%

» Non-GAAP Earnings Per

Share**:

$3.95 - $4.05

» Share Repurchases: Up to $1.25 billion (subject to available cash, market conditions

and other ongoing capital allocation decisions)

» Capital Expenditures: Approximately $90 million

» Depreciation & Amortization: Approximately $100 million

» Growth in Compliance &

Regulatory Expenses:

Less than $5 million

» Free Cash Flow***: Approximately $900 million


37 November 4, 2014

Transaction and Recurring Revenue 3Q14 Revenue by Type

3Q14 Revenue by Geography 3Q14 Revenue by Business

Breadth of Moody’s Businesses and Global Footprint Provide Diversification


Corporate Finance

32%

Structured Finance

12%

Financial Institutions

11%

Public, Project &

Infrastructure 11%

Research, Data &

Analytics 18%

Enterprise Risk

Solutions 10%

Professional Services

6%

United States 55%

EMEA 28%

Asia-Pacific 10%

Americas 7%

51% 40%

73%

49% 60%

27%

MCO MIS MA

Transaction

Recurring

Moody’s Investors Service

» Transaction revenue recognized when rating published

» Recurring revenue recognized ratably over security life

Moody’s Analytics

» Transaction revenue recognized when service rendered

» Recurring revenue recognized ratably over contract period

38 November 4, 2014

Corporate Finance: Revenue and Issuance

*Historical data has been adjusted to conform with current information. All amounts above exclude intercompany revenue.

**Sources: Moody’s Capital Markets Research Group, Dealogic, Barclay's Capital; U.S. Speculative-Grade Bank Loan Origination represents Moody’s rated new U.S. bank loan programs.

Note: Debt issuance categories do not directly correspond to Moody’s revenue categorization.


$0

$200

$400

$600

$800

$1,000

2006 2007 2008 2009 2010 2011 2012 2013

Reven

ue

$ M

illi

on

s

Historical Revenue* Mix: By Year

Bank Loans Speculative Grade

Investment Grade Other - including monitoring, CP, MTNs

$0

$50

$100

$150

$200

$250

$300

$350

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Reven

ue

$ M

illi

on

s

Historical Revenue* Mix: By Quarter



$0

$500

$1,000

$1,500

$2,000

2006 2007 2008 2009 2010 2011 2012 2013

Issu

an

ce $

Bil

lio

ns

Global Rated Non-Financial Bonds and U.S. Speculative Grade Bank Loans (Annually)**

U.S. Speculative-Grade Bank Loan Origination

Global Non-Financial Speculative-Grade Bond Issuance

Global Non-Financial Investment-Grade Bond Issuance

0%

2%

4%

6%

8%

10%

$0

$100

$200

$300

$400

$500

$600

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Yie

ld (

%)

Issu

an

ce $

Bil

lio

ns

Global Rated Non-Financial Bonds and U.S. Speculative Grade Bank Loans (Quarterly)**

U.S. Speculative-Grade Bank Loan Origination

Global Non-Financial Speculative-Grade Bond Issuance

Global Non-Financial Investment-Grade Bond Issuance

Global Investment-Grade Corporate Yield (%)

Global Speculative-Grade Corporate Yield (%)

39 November 4, 2014

39% 43% 36% 32% 35%

42% 37% 36% 37% 32% 40%

19% 21%

23% 17%

23% 14% 23% 19% 18% 20%

15%

25% 18% 23% 29%

22% 20% 21% 23% 20% 24% 21%

17% 18% 18% 22% 20% 24% 20% 21% 25% 24% 24%

0%

20%

40%

60%

80%

100%

FY10 FY11 FY12 1Q13 2Q13 3Q13 4Q13 FY13 1Q14 2Q14 3Q14



73% 71% 74% 76% 74% 70% 69% 73% 71% 74% 69%

27% 29% 26% 24% 26% 30% 31% 27% 29% 26% 31%

0%

20%

40%

60%

80%

100%


Revenue* Distribution: Recurring vs. Transaction


Corporate Finance: Revenue Diversification


34% 35% 34% 37% 42% 35% 39% 38% 35%

43% 37%

66% 65% 66% 63% 58% 65% 61% 62% 65%

57% 63%

0%

20%

40%

60%

80%

100%


Revenue Distribution by Geography

Non - U.S. U.S.

Revenue by Product


40 November 4, 2014

Structured Finance: Revenue and Issuance

$0

$20

$40

$60

$80

$100

$120

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Reven

ue

$ M

illi

on

s


ABS RMBS CREF Structured Credit


**Sources: AB Alert, CM Alert, Moody’s Corporation.

Notes: ABS includes asset-backed commercial paper and long-term asset-backed securities. RMBS includes covered bonds. CREF includes commercial mortgage-backed securities, real

estate finance, and commercial real estate CDOs. Debt issuance categories do not directly correspond to Moody’s revenue categorization.


$0

$200

$400

$600

$800

$1,000

2006 2007 2008 2009 2010 2011 2012 2013

Reven

ue

$ M

illi

on

s


ABS RMBS CREF Structured Credit

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

2006 2007 2008 2009 2010 2011 2012 2013

Issu

an

ce $

Bil

lio

ns

Global Rated Structured Finance (Annually)**

ABS RMBS CMBS CDO

$0

$50

$100

$150

$200

$250

$300

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Issu

an

ce $

Bil

lio

ns

Global Rated Structured Finance (Quarterly)**

ABS RMBS CMBS CDO

41 November 4, 2014

Structured Finance: Revenue Diversification


**CREF includes commercial mortgage-backed securities, real estate finance, and commercial real estate CDOs.

***Residential Mortgage-backed Securities includes covered bonds.

****ABS includes asset-backed commercial paper and long-term asset-backed securities.


43% 52% 58% 59% 61%

54% 66% 60% 58% 63% 59%

57% 48% 42% 41% 39%

46% 34% 40% 42% 37% 41%

0%

20%

40%

60%

80%

100%




51% 53% 46%

36% 36% 36% 36% 36% 34% 34% 31%

49% 47% 54%

64% 64% 64% 64% 64% 66% 66% 69%

0%

20%

40%

60%

80%

100%



Non - U.S. U.S.

28% 23% 24% 29% 23% 24% 24% 25% 26% 33% 33%

18% 20%

25% 28%

32% 31% 32% 30% 31% 27% 26%

23% 26% 22%

18% 19% 20% 19% 19% 19% 18% 18%

31% 31% 29% 25% 26% 25% 25% 26% 24% 22% 23%

0%

20%

40%

60%

80%

100%


Asset-backed Securities**** Residential Mortgage-backed Securities***

Commercial Real Estate Finance** Structured Credit

Revenue by Product

42 November 4, 2014

Financial Institutions: Revenue and Issuance

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Reven

ue

$ M

illi

on

s


Banking Insurance Managed Investments


$0

$50

$100

$150

$200

$250

$300

$350

$400

2006 2007 2008 2009 2010 2011 2012 2013

Reven

ue

$ M

illi

on

s



$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

2006 2007 2008 2009 2010 2011 2012 2013

Issu

an

ce $

Bil

lio

ns

Global Rated Financial Bonds (Annually)**

Global Speculative Grade Financial Corporate Bond Issuance

Global Investment Grade Financial Corporate Bond Issuance


**Sources: Moody’s Capital Markets Research Group, Dealogic, Barclay’s Capital Note: Debt issuance categories do not directly correspond to Moody’s revenue categorization.

0%

1%

2%

3%

4%

5%

6%

$0

$100

$200

$300

$400

$500

$600

$700

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Yie

ld (

%)

Issu

an

ce $

Bil

lio

ns

Global Rated Financial Bonds (Quarterly)**

Global Speculative Grade Financial Corporate Bond Issuance

Global Investment Grade Financial Corporate Bond Issuance

Global Banking Yield (%)

Global Insurance Yield (%)

43 November 4, 2014

Financial Institutions: Revenue Diversification



37% 34% 37% 38% 35% 30% 36% 35% 34% 35% 38%

63% 66% 63% 62% 65% 70% 64% 65% 66% 65% 62%

0%

20%

40%

60%

80%

100%




59% 60% 59% 58% 57% 56% 59% 58% 59% 62% 59%

41% 40% 41% 42% 43% 44% 41% 42% 41% 38% 41%

0%

20%

40%

60%

80%

100%



Non-U.S. U.S.

69% 69% 70% 70% 68% 66% 71% 69% 67% 69% 66%

25% 26% 24% 26% 28% 30% 22% 26% 25% 26% 30%

6% 5% 6% 4% 4% 4% 6% 5% 8% 5% 4%

0%

20%

40%

60%

80%

100%



Revenue by Product

44 November 4, 2014

$0

$50

$100

$150

$200

$250

$300

$350

$400

2006 2007 2008 2009 2010 2011 2012 2013

Reven

ue

$ M

illi

on

s


Public FinanceMunicipal Structured ProductsProject & Infrastructure Finance


**Sources: Thomson SDC, Moody’s Corporation. Note: Debt issuance categories do not directly correspond to Moody’s revenue categorization.


$0

$20

$40

$60

$80

$100

$120

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Issu

an

ce $

Bil

lio

ns

Long-Term Rated U.S. Municipal Bond Issuance (Quarterly)**

$0

$100

$200

$300

$400

$500

2006 2007 2008 2009 2010 2011 2012 2013

Issu

an

ce $

Bil

lio

ns

Long-Term Rated U.S. Municipal Bond Issuance (Annually)**

$0

$20

$40

$60

$80

$100

$120

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Reven

ue

$ M

illi

on

s


Public FinanceMunicipal Structured ProductsProject & Infrastructure Finance

Public, Project and Infrastructure: Revenue and Issuance

45 November 4, 2014



59% 58% 61% 61% 63% 58% 57% 60% 53%

63% 58%

41% 42% 39% 39% 37% 42% 43% 40% 47%

37% 42%

0%

20%

40%

60%

80%

100%




31% 36% 35% 33% 32% 40% 43% 37% 41% 37% 35%

69% 64% 65% 67% 68% 60% 57% 63% 59% 63% 65%

0%

20%

40%

60%

80%

100%



Non - U.S. U.S.

51% 49% 50% 51% 47% 44% 43% 46% 46% 41% 45%

41% 44% 44% 44% 48% 51% 52% 49% 49% 55% 51%

8% 7% 6% 5% 5% 5% 5% 5% 5% 4% 4%

0%

20%

40%

60%

80%

100%


Public Finance

Project & Infrastructure Finance

Municipal Structured Products

Revenue by Product

Public, Project and Infrastructure: Revenue Diversification

46 November 4, 2014

Moody’s Analytics: Financial Overview

$0

$50

$100

$150

$200

$250

$300

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14

Reven

ue

$ M

illi

on

s




$0

$200

$400

$600

$800

$1,000

2007 2008 2009 2010 2011 2012 2013

Reven

ue

$ M

illi

on

s


Professional Services

Enterprise Risk Solutions

Research, Data and

Analytics

14% 20% 23% 20% 20% 22% 27% 22% 23% 23% 27%

86% 80% 77% 80% 80% 78% 73% 78% 77% 77% 73%

0%

20%

40%

60%

80%

100%



56% 58% 57% 54% 56% 56% 54% 55% 54% 57% 56%

44% 42% 43% 46% 44% 44% 46% 45% 46% 43% 44%

0%

20%

40%

60%

80%

100%



Non-U.S. U.S.

68% 63% 58% 62% 60% 59% 54% 58% 58% 57% 54%

28% 26% 29% 25% 28% 28% 33% 29% 25% 27% 30%

4% 11% 13% 13% 12% 13% 13% 13% 17% 16% 17%

0%

20%

40%

60%

80%

100%

FY10FY11FY121Q132Q133Q134Q13FY131Q142Q143Q14

Revenue by Product


47 November 4, 2014

Select Regulations Related to Structured Finance

Dodd-Frank Act

Volcker Rule

(§619)

The Volcker Rule prohibits banking entities from engaging in short-term proprietary trading of certain securities and derivatives

for their own account. The Volcker Rule also imposes limits on banking entities’ investments in, and relationships with, hedge

funds and private equity funds. In mid-January 2014, the five federal agencies adopted an interim final rule which permits the

banking entities to retain interests in certain collateralized debt obligations backed primarily by trust preferred securities that

would otherwise be subject to the Volcker Rule’s covered fund investment prohibitions. On April 7, 2014, the Fed announced its

intention to give banking entities two additional one-year extensions (which together would extend the deadline until July 21,

2017) to conform to the Volcker Rule their ownership interests in and sponsorship of collateral loan obligations (“CLOs”) that fall

under the definition of covered funds. Only CLOs in place as of December 31, 2013 will be eligible for the extensions.

Enhanced Prudential

Standards

(§165)

On February 18, 2014, the Fed approved a final rule strengthening the supervision and regulation of large U.S. bank holding

companies and foreign banking organizations (“FBO”). The final rule establishes a number of enhanced prudential standards,

including liquidity, risk management, and capital. It also requires a FBO with a significant U.S. presence to establish an

intermediate holding company over its U.S. subsidiaries.

On September 3, 2014, the federal banking regulators adopted a final rule on the liquidity coverage ratio which strengthens the

liquidity positions of large financial institutions. Each institution will be required to hold high quality, liquid assets that can be

converted quickly into cash in an amount equal to or greater than its projected cash outflows minus its projected cash inflows

during a 30-day stress period.

On September 9, 2014, the federal banking agencies have issued a joint final rule that revises the denominator of the

supplementary leverage ratio (total leverage exposure). The final rule aligns the agencies' methods of calculation with the

international leverage ratio standards and it applies to banking organizations subject to the advanced approaches risk-based

capital rules.

QM

(§§1411, 1412, 1414)

Effective January 10, 2014, mortgage lenders must comply with the Consumer Finance Protection Bureau’s Ability-To-Repay and

Qualified Mortgage Rule. The rule also provides a safe harbor for loans that satisfy the definition of a qualified mortgage (“QM”)

and are not “higher-priced," and provides a rebuttable presumption for higher-priced mortgage loans.

QRM

(§941)

Exempts from risk retention requirements asset-backed securities (“ABS”) that are collateralized exclusively by residential

mortgages that qualify as “qualified residential mortgages ” (“QRM”). In a final rule issued on October 22, 2014, six federa l

agencies, including the Federal Reserve Board and the SEC, adopted a definition of QRM that is aligned with the definition of

QM. Qualified Commercial Real Estate Loans (“QCREL”) will also be exempt from risk retention.

Loan-Level

Disclosure

(§942)

Increases disclosure and may reduce issuance volume. The regulation requires an issuer of ABS to disclose, for each tranche or

class of security, certain loan level information regarding the assets backing that security.


48 November 4, 2014

Select Regulations Related to Structured Finance (continued)

Dodd-Frank Act (continued)

Risk Retention

(§941)

On October 22, 2014, six federal agencies approved a final rule requiring retention of an unhedged and untransferable 5% credit

risk of SF securities, potentially dampening U.S. SF issuance for certain asset classes. The final rule generally permits risk

retention to be accomplished through one or a combination of methods. The final rule also provides additional or modified risk

retention methods for specific types of transactions, including asset-backed commercial paper conduits, commercial mortgage-

backed securities, securitizations sponsored by Fannie Mae and Freddie Mac, open-market CLOs, and revolving pool

securitizations. Special rules for CMBS (third party holder of first loss piece) if certain criteria are met). The final rule also sets

forth prohibitions on transferring or hedging the credit risk that the sponsor is required to retain. The final rule also does not

require any retention for securitizations of commercial loans, commercial mortgages, or automobile loans if they meet specific

standards for high quality underwriting. The final rule will be effective one year after publication in the Federal Register for

residential mortgage-backed securitizations and two years after publication for all other securitization types.

Reg. AB II Provides new disclosure and reporting requirements for certain ABS. The Reg. AB II Final Rules require issuers of registered

and publicly offered ABS that consist of residential mortgages, commercial mortgages, auto loans and auto leases and

resecuritizations of ABS that include these asset types, or of debt securities, to provide investors with asset-level data, both at

the time of an offering and on an ongoing basis. The Reg. AB II Final Rules also enhance disclosure requirements for initial

ABS offerings and periodic reports, dictate the timing for filing a preliminary prospectus and other transaction documents and

provide new requirements for shelf registrations of ABS .

The definition of ABS, as used in the Reg. AB II Final Rules, is narrower than the definition set forth in the Securities Exchange

Act of 1934 and does not include certain “structured finance products” such as securitizations of managed pools or synthetic

transactions.

FASB/IASB joint financial

instruments accounting

projects

Requires some debt instruments to be marked to fair value. Debt instruments carried at amortized cost or fair value through other

comprehensive income would be subject to more conservative impairment testing, with more timely recognition of credit losses

than under existing rules. The proposals may create a disincentive to hold securitized assets (i.e., if they have to be marked to

fair value and/or subject to more conservative impairment testing), but conversely the proposals may incentivize banks to

securitize more of their loan portfolios.


49 November 4, 2014

US IG

US HY

US Infrastructure

EMEA IG

EMEA HY

EMEA Infrastructure

US ABS

US CMBS

US Structured Credits

EMEA ABS

EMEA CMBS

EMEA StructuredCredit

3-Year Average and Trailing 12-Month Issuance Versus Recent Historical Peak Issuance

Recent Annual Peak

Market Rated

Issuance (since

2007)

(2011)

(2007)

(2009) (2007)

(2007)

(2007)

(2013)

(2009)

(2013)

(2013)

Source: Moody’s Investors Service.

( ) Year in parenthesis

is the peak issuance

year

(2013)

(2007)

3-Year Average

market Rated

Issuance (’11-’13) as

% of Peak Issuance

Trailing 12-Month

(ended 9/30/2014)

Market Rated

Issuance as % of

Peak Issuance


50 November 4, 2014

Anatomy of a Stress Test

Profit and Loss Forecast

Year 1 Year 2 + 1Q

Q’s 1 2 3 4 Q’s 5 6 7 8 & 9 Capital Plan and

Capital Adequacy

Under Stress

» Based on balance sheet

and P&L projections,

banks develop capital

plan

» Regulator reviews

methodology, conducts

independent stress

analysis, evaluates

results

» Memoranda issued to

identify and remediate

deficiencies

Stressed Balance Sheet

» Banks estimate credit losses

and cash flows based on

economic scenarios set by

regulator

» Scenarios and associated loss

projections flow through to

revenues and expenses,

informing financial statement

forecasts over the planning

horizon (9 quarters under

CCAR)

Baseline

Adverse

Severely

Adverse

Bank-

Specific

Baseline

Bank-

Specific

Adverse

C&I Loans

CRE Loans

Mortgage

Loans

Auto Loans

Other Retail

Loans

Deposits

Other

Funding

Economic

Scenarios

Credit Models

(PD, LGD) Projections

Capital Adequacy Results

and Regulatory Reports

Defi

ne

d b

y r

eg

ula

tor

Cali

bra

ted

to

ban

k’s

bu

sin

es

s a

nd

ma

rket


51 November 4, 2014

23%

3%

7%

2%

8%

48%

14%

1%

8%

51%

75%

72%

54%

31%

29%

58%

4%

25%

26%

23%

21%

44%

61%

23%

28%

95%

68%

Asia (Excl. Japan)

S. America / C. America / Caribbean

Africa / Middle East

Eastern Europe

Western Europe

Canada

Australia / Oceania

Japan

United States

MA 2013 Sales by Region

Professional Services Enterprise Risk Solutions Research, Data and Analytics

Moody’s Analytics is Relevant to Financial Markets at All Stages of Development

» Moody’s Analytics enables us to increase our presence in emerging markets, selling

products and services before debt capital markets are fully mature


Emerging Developed

52 November 4, 2014

Recurring Revenue Detail


Recurring Revenue ($ Millions)

2009 2010 2011 2012 2013

TTM

3Q14

2009 –

TTM 3Q14

CAGR

Corporate Finance $ 147 $ 155 $ 190 $ 226 $ 273 $ 314 17%

Structured Finance $ 181 $ 165 $ 165 $ 159 $ 151 $ 159 -3%

Financial Institutions $ 178 $ 177 $ 194 $ 204 $ 219 $ 230 6%

Public, Project, & Infrastructure

Finance $ 102 $ 111 $ 116 $ 126 $ 137 $ 146 8%

Moody's Investors Service $ 608 $ 607 $ 664 $ 714 $ 781 $ 849 7%

Moody's Analytics $ 522 $ 537 $ 572 $ 652 $ 709 $ 766 8%

Moody's Corporation $ 1,129 $ 1,144 $ 1,236 $ 1,366 $ 1,490 $ 1,615 8%

53 November 4, 2014

Moody’s Global Presence


*As of September 30, 2014.

**As of September 30, 2013.

*** Moody's has a Technical Services Agreement with Equilibrium, a rating agency that provides credit rating and research services.

U.S. employees

non-U.S. employees

total employees**

U.S. employees

non-U.S. employees

total employees*

3,033 6,704 9,737

2014

2,798 4,412 7,210

2013

54 November 4, 2014

in $ millions

Reporting as per 2008 filings 1Q 2Q 3Q 4Q FY08**

Structured Finance 107.2$ 120.1$ 97.7$ 92.2$ 417.2$

Corporate Finance 71.5 97.4 75.0 56.6 300.5

Financial Institutions 64.0 72.1 64.4 56.5 257.0

Public, Project & Infrastructure Finance 55.5 66.2 59.7 48.6 230.0

Total Moody's Investors Service* 298.2 355.8 296.8 253.9 1,204.7

Total Moody's Analytics 132.5 131.8 136.6 149.8 550.7

Total Moody's Corporation 430.7$ 487.6$ 433.4$ 403.7$ 1,755.4$

Reclass for 2008 and 2009 Business Change: Managed Investments, Credit Estimates

Structured Finance (4.8)$ (4.5)$ (2.0)$ (1.2)$ (12.5)$


Financial Institutions 3.0 3.0 - - 6.0

Public, Project & Infrastructure Finance - - - - -

Total Moody's Investors Service - - - - -

Total Moody's Analytics - - - - -

Total Moody's Corporation -$ -$ -$ -$ -$

2009 (Current) Business Line Reporting 1Q 2Q 3Q 4Q FY08

Structured Finance 102.4$ 115.6$ 95.7$ 91.0$ 404.7$


Financial Institutions 67.0 75.1 64.4 56.5 263.0

Public, Project & Infrastructure Finance 55.5 66.2 59.7 48.6 230.0

Total Moody's Investors Service* 298.2 355.9 296.8 253.8 1,204.7

Total Moody's Analytics 132.5 131.8 136.6 149.8 550.7

Total Moody's Corporation 430.7$ 487.7$ 433.4$ 403.6$ 1,755.4$

* Excludes intersegment royalty

** FY08 "Reporting as per 2008 filings" represents cumulative total of 10Q filings

2008 Revenue MIS Business Line Reclassification

In August 2008, the global managed investments ratings group which was previously part of Structured Finance, was moved to the Financial Institutions business. In 2009, credit

estimates was moved to Corporate Finance.


55 November 4, 2014

2009 Moody’s Analytics Revenue Reclassification


in $ millions

Reporting as per filings in year 2008 2009

Subscriptions $ 475.9 n/a

Software 49.2 n/a

Professional Services 25.6 n/a

Total Moody's Analytics $ 550.7 n/a

Reclass for 2009 Realignment*:

Subscriptions $ (57.2) n/a

Software 59.6 n/a

Professional Services (2.4) n/a

Total Moody's Analytics $ - n/a

2009 (Current) Reporting 2008 2009

Research, Data and Analytics $ 418.7 $ 413.6

Enterprise Risk Solutions 108.8 145.1

Professional Services 23.2 20.8

Total Moody's Analytics $ 550.7 $ 579.5

*During the fourth quarter of 2009 the Moody's Analytics ("MA") groupings were realigned and renamed to reflect the

reporting unit structure for the MA segment at December 31, 2009. Pursuant to this realignment the Subscriptions

grouping was renamed Research, Data and Analytics and the Software grouping was renamed Risk Management

Software. The revised groupings classify certain subscription-based risk management software revenue and

advisory services relating to software sales to the redefined Risk Management Software grouping. Risk

Management Software was renamed Enterprise Risk Solutions during the first quarter of 2012.

56 November 4, 2014

Adjusted Operating Income and Adjusted Operating Margin Reconciliation

Reconciliation of Non-GAAP Financial Measures to GAAP

Moody's Corporation Operating Margin Guidance Reconciliation


(in $ millions) 2009 2010 2011 2012 2013

As Reported Operating Income $687.5 $772.8 $888.4 $1,077.4 $1,234.6

Operating Margin 38.3% 38.0% 39.0% 39.5% 41.5%

Add Adjustment:

Depreciation & Amortization $64.1 $66.3 $79.2 $93.5 $93.4

Restructuring 17.5 0.1

-

- -

Goodwill Impairment Charge

-

-

- 12.2 -

Adjusted Operating Income $769.1 $839.2 $967.6 $1,183.1 $1,328.0

Adjusted Operating Margin 42.8% 41.3% 42.4% 43.3% 44.7%

2014F*

Projected Operating Margin -

GAAP 42% to 43%

Projected impact from Depreciation

& Amortization Approximately 3%

Projected Adjusted Operating

Margin 45% to 46%


Moody's Corporation Non-GAAP EPS Guidance Reconciliation

2014F*

Diluted EPS guidance - GAAP $4.34 – 4.44

ICRA Gain (0.36)

Legacy Tax (0.03)

Diluted EPS guidance – Non-GAAP $3.95 – 4.05

57 November 4, 2014

Reconciliation of Non-GAAP Financial Measures to GAAP (cont.)

Moody's Corporation Free Cash Flow Reconciliation

(in $ millions) 2009 2010 2011 2012 2013 2014F*

Cash Flow from Operations $ 643.8 $ 653.3 $ 803.3 $ 823.1 $ 926.8 $ ~990.0

Less Adjustment:

Capital Expenditures $ 90.7 $ 79.0 $ 67.7 $ 45.0 $ 42.3 $ ~90.0

Free Cash Flow $ 553.1 $ 574.3 $ 735.6 $ 778.1 $ 884.5 $ ~900.0

Cash Flow used in Investing Activities $ (93.8) $ (228.8) $ (267.6) $ (50.2) $ (261.9)

Cash Flow provided by (used in) Financing Activities $ (348.8) $ (241.3) $ (417.7) $ 202.6 $ (498.8)



58 November 4, 2014

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59 November 4, 2014

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