UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported):  November 7, 2014

 

MORNINGSTAR, INC.

(Exact name of registrant as specified in its charter)

 

 

 

(312) 696-6000

(Registrant’s telephone number, including
area code)

 

N/A

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 7.01. Regulation FD Disclosure.

 

The following information is included in this Current Report on Form 8-K as a result of Morningstar, Inc.’s policy regarding public disclosure of corporate information. Answers to additional inquiries, if any, that comply with this policy are scheduled to become available on December 5, 2014.

 

Caution Concerning Forward-Looking Statements

 

This current report on Form 8-K 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 discuss not to occur or to differ significantly from what we expect. For us, these risks and uncertainties include, among others,

 

·                  liability for any losses that result from an actual or claimed breach of our fiduciary duties;

·                  failing to differentiate our products and continuously create innovative, proprietary research tools;

·                  failing to respond to technological change, keep pace with new technology developments, or adopt a successful technology strategy;

·                  a prolonged outage of our database and network facilities;

·                  any failures or disruptions in our electronic delivery systems and the Internet;

·                  liability and/or damage to our reputation as a result of some of our pending litigation;

·                  liability related to the storage of personal information about our users;

·                  general industry conditions and competition, including global financial uncertainty, trends in the mutual fund industry, and continued growth in passively managed investment vehicles;

·                  the impact of market volatility on revenue from asset-based fees;

·                  failing to maintain and protect our brand, independence, and reputation;

·                  changes in laws applicable to our investment advisory or credit rating operations, compliance failures, or regulatory action; and

·                  challenges faced by our operations outside the United States, including the concentration of development work at our offshore facilities in China and India.

 

Investor Questions and Answers: November 7, 2014

 

We plan to make written responses available addressing investor questions about our business on the first Friday of every month. The following answers respond to selected questions received through November 5, 2014. We intend to answer as many questions as time allows, although we will not answer product support questions through this channel. We may wait to respond to a given question until the following month if we need more time to research the answer.

 

If you would like to submit a question, please send an e-mail to investors@morningstar.com or write to us at the following address:

 

Morningstar, Inc.

Investor Relations

22 W. Washington

Chicago, IL 60602

 

Effect of Changes in Foreign Currency

 

1.             I had a quick question for you. We are doing a project to try to understand the potential EPS impact of a 1% overall FX [foreign currency] change. Could you tell me what you believe the impact would be for Morningstar and what the rationale behind your estimate is? I realize this can be difficult to predict, but any color would be extremely helpful.

 

We currently generate approximately 28% of our consolidated revenue from outside the United States, so currency movements can affect our reported revenue. Our cost base is also diversified geographically, though, so there are some natural hedges in place, meaning that the effect of currency movements on revenue tends to be offset by a corresponding effect on operating expense. The cost of our local operations is generally in proportion to the amount of revenue we generate in each country. A couple of exceptions to this are China and India, where we have higher operating expense relative to revenue because of our development centers. We also have higher operating expense in the United Kingdom, where we operate many of our shared services for Europe. Overall, though, we haven’t seen a major effect on earnings from currency movements.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

		MORNINGSTAR, INC.
Date: November 7, 2014	By:	/s/ Stéphane Biehler
		Stéphane Biehler
		Chief Financial Officer

 

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