CHICAGO, Feb. 19 /PRNewswire-FirstCall/ -- Morningstar, Inc.
(Nasdaq: MORN), a leading provider of independent investment research, today
announced changes to its organizational structure and operating segments.
Under the new structure Morningstar now has two operating segments: Investment
Information and Investment Management. Previously, Morningstar organized its
operations based on three audience segments: Individual, Advisor, and
Institutional. The changes were effective Jan. 1, 2009, and the company will
begin reporting its financial results based on the new operating segments when
it issues its first-quarter 2009 earnings press release on April 30, 2009.
Morningstar is changing its structure to organize its operations according
to product lines and growth strategies rather than audience segments. The new
Investment Information segment includes all of the company's data, software,
and research products and services. These products and services are typically
sold through subscriptions or license agreements. The Investment Management
segment includes all of the company's asset management operations, which
operate as registered investment advisors and earn the majority of their
revenue from asset-based fees. In addition, under the previous segment
reporting, Morningstar allocated costs for its corporate functions to each of
the segments. Beginning in 2009, Morningstar will no longer allocate corporate
costs to its business segments.
Joe Mansueto, chairman and chief executive officer of Morningstar, said,
"We've structured the company along product lines to better align with our
growth strategies and because many of our offerings now cross a variety of
audiences. Our senior management team remains the same; we're simply shifting
some of our leaders into different roles."
Investment Information
The Investment Information segment includes all of the company's data,
software, and research products and services.
Data:
Elizabeth Kirscher remains president of data services, including all of
the company's global data operations. The main product in this area is
Morningstar Licensed Data, a set of investment data spanning all of
Morningstar's investment databases and available through electronic data
feeds.
Software:
Bevin Desmond, who runs the company's international operations, retains
that role and has also been named president of institutional software. The
largest product in this area is Morningstar Direct, a Web-based institutional
research platform.
Chris Boruff, previously president of the advisor business unit, is now
president of advisor software. Key products in this area are Advisor
Workstation, a Web-based investment planning system for advisors; and
Principia, a CD-ROM-based investment research and planning software for
advisors.
Kunal Kapoor, who currently serves as president of Morningstar Investment
Services, Inc., has been named president of individual investor software. The
largest product in this area is Morningstar.com, which includes Premium
memberships and Internet advertising sales.
Investment Research:
Catherine Gillis Odelbo, previously head of the individual investor
business, has been named president of equity research. Key offerings in this
area include Morningstar Equity Research, Financial Communications and
Publications, Morningstar Real-Time Data, and Morningstar Indexes.
Don Phillips, a member of the board of directors and one of the company's
managing directors, also becomes president of fund research, which includes
research on mutual funds, exchange-traded funds, and alternative investments.
Investment Management
The Investment Management segment includes three registered investment
advisory firms: Morningstar Associates, LLC, Ibbotson Associates, Inc., and
Morningstar Investment Services, Inc.
Patrick Reinkemeyer remains president of Morningstar Associates. The key
products and services in this business are Investment Consulting, which
focuses on investment monitoring and asset allocation for funds of funds,
including mutual funds and variable annuities; and Retirement Advice,
including Morningstar Retirement Manager.
Peng Chen remains president of Ibbotson Associates. The key products and
services in this business are Investment Consulting, including funds of funds
and plan sponsor consulting, and Retirement Advice, including Advice by
Ibbotson.
Jeffrey Ptak has been named chief investment officer of Morningstar
Investment Services, and will become president following a transition period.
The key service in this business is Morningstar Managed Portfolios, a fee-
based discretionary asset management service that includes a series of mutual
fund, exchange-traded fund, and stock-based portfolios for use by financial
advisors.
In addition to its organization and segment changes, Morningstar also
today announced its fourth-quarter and full-year 2008 financial results. When
Morningstar files its Annual Report on Form 10-K in March 2009, it will
present a supplemental table with financial results for 2008, 2007, and 2006
as if they had been reported under the new operating segments.
Investor Communication: Morningstar encourages all interested parties --
including securities analysts, current shareholders, potential shareholders,
and others -- to submit questions in writing. Investors and others may send an
e-mail to investors@morningstar.com, contact the company via fax at
312-696-6009, or write to Morningstar at the following address:
Morningstar, Inc.
Investor Relations
22 W. Washington Street
Chicago, IL 60602
Morningstar will make written responses to selected inquiries available to
all investors at the same time in Form 8-Ks furnished to the Securities and
Exchange Commission, generally on the first Friday of every month.
About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent investment research
in North America, Europe, Australia, and Asia. The company offers an extensive
line of Internet, software, and print-based products and services for
individuals, financial advisors, and institutions. Morningstar provides data
on more than 300,000 investment offerings, including stocks, mutual funds, and
similar vehicles. The company has operations in 19 countries and minority
ownership positions in companies based in three other countries.
Caution Concerning Forward-Looking Statements
This press release contains forward-looking statements as that term is
used in the Private Securities Litigation Reform Act of 1995. These statements
are based on our current expectations about future events or future financial
performance. Forward-looking statements by their nature address matters that
are, to different degrees, uncertain, and often contain words such as "may,"
"could," "expect," "intend," "plan," "seek," "anticipate," "believe,"
"estimate," "predict," "potential," or "continue." These statements involve
known and unknown risks and uncertainties that may cause the events we
discussed not to occur or to differ significantly from what we expected. For
us, these risks and uncertainties include, among others, general industry
conditions and competition, including the global financial crisis that began
in 2007; the impact of market volatility on revenue from asset-based fees;
damage to our reputation resulting from claims made about possible conflicts
of interest; liability for any losses that result from an actual or claimed
breach of our fiduciary duties; financial services industry consolidation; a
prolonged outage of our database and network facilities; challenges faced by
our non-U.S. operations; and the availability of free or low-cost investment
information. A more complete description of these risks and uncertainties can
be found in our filings with the Securities and Exchange Commission, including
our Annual Report on Form 10-K for the year ended December 31, 2007. If any of
these risks and uncertainties materialize, our actual future results may vary
significantly from what we expected. We do not undertake to update our
forward-looking statements as a result of new information or future events.
(C)2009 Morningstar, Inc. All rights reserved.
Contact:
Media: Margaret Kirch Cohen, 312-696-6383 or
margaret.cohen@morningstar.com
Investors may submit questions to investors@morningstar.com or by
fax to 312-696-6009.
