Table of Contents
4Q 2006 Earnings Call January 25, 2007
Donald S. Rubin Senior Vice President, Investor Relations The McGraw-Hill Companies
“Safe Harbor” Statement Under The Private Securities Litigation Reform Act of 1995
Harold McGraw III Chairman, President and CEO The McGraw-Hill Companies
Exceeded our guidance for full year and 4Q 2006
Poised for double-digit earnings growth in 2007
MHP has outperformed S&P 500 total return for a decade
A commitment to advancing total shareholder value
Outlook for economy
McGraw-Hill Education Financial Services Information & Media
Key takeaways for McGraw-Hill Education in 2006
McGraw-Hill Education
Managed costs in weaker state new adoption market in 2006
Our performance in important 2006 state new adoptions
Our performance in important 2006 state new adoptions
Up in open territories; down in state new adoptions
Challenges in testing
Expect School Education Group to improve in 2007
Participating in more of the addressable market in 2007
2007: Timed new products to pursue bigger growth opportunities
2007: Timed new products to pursue bigger growth opportunities
2007: Timed new products to pursue bigger growth opportunities
Stronger organization to compete in core basal market
Publishing for the opportunity: Competing with a spectrum of products
Technology investments to improve testing
Expect more improvement in 2007 from HPI Group
New growth from digital products
New growth from digital products
Outlook for McGraw-Hill Education
McGraw-Hill Education Financial Services Information & Media
Financial Services finished 2006 on an upswing
Financial Services
Why Financial Services set new records in 2006
How a diversified and resilient portfolio delivers results
How a diversified and resilient portfolio delivers results
How a diversified and resilient portfolio delivers results
New issuance: 2006 vs. 2005
New issuance: 2006 vs. 2005
How a diversified and resilient portfolio delivers results
Expectations for new issuance dollar volume in 2007
Reduced dependence on transaction revenue
Continuing to leverage index products and services
Continuing global demand for equity and fixed income information
Outlook for Financial Services
McGraw-Hill Education Financial Services Information & Media
Information & Media
Advertising was mixed in 2006
Advertising was mixed in 2006
Advertising was mixed in 2006
The transformation of Information & Media
The transformation of Information & Media
J.D. Power poised for global expansion
J.D. Power and Associates: Expanding global automotive business
Outlook for energy market
Outlook for Information & Media
Summing up for The McGraw-Hill Companies
Outlook for The McGraw-Hill Companies
Robert J. Bahash Executive Vice President and Chief Financial Officer The McGraw-Hill Companies
A commitment to advancing total shareholder value
Strong cash flow
Bought 28.4 million shares in 2006
Reduced fully-diluted weighted average shares outstanding (WASO)
Outlook for interest expense
Analyzing 2006-05 earnings
Analyzing fourth quarter earnings
Revenue recognition and transformation of Sweets
Impact of incremental stock-based compensation
Impact of incremental stock-based compensation
Corporate expenses
2004 and 2005 acquisitions cash positive in 2007
Outlook for tax rate
Increasing pre-publication investments
Growth in capital expenditures for property and equipment
Outlook for non-cash charges
Outlook for non-cash charges
Outlook for non-cash charges
Measuring 2006 free cash flow
Outlook for free cash flow in 2007
4Q 2006 Earnings Call January 25, 2007
4Q 2006 Earnings Call January 25, 2007
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