Dow Jones Newswires | Morningstar Inc.’s fourth-quarter profit
fell 25 percent as the investment research provider reported charges
related to stock-option adjustments.

The company — which provides data on stocks, mutual funds and similar
vehicles — also reported a surprise increase in revenue, after posting
declines the rest of 2009 after two clients declined to renew their
contracts.

The company’s margins had improved throughout most of the year due to
cost-cutting measures, including a reduction to bonuses, although that
metric declined in the fourth quarter amid the charge.

On Thursday, Morningstar reported a profit of $14.4 million, or 29
cents a share, down from $19.3 million, or 39 cents a share, a year
earlier. The latest results included a 10-cent charge related to
stock-option adjustments. Revenue grew 2.8 percent to $122.6 million.

Analysts surveyed by Thomson Reuters expected earnings of 42 cents on revenue of $115 million.

Operating margin dropped to 19.8 percent from 24.1 percent.

Revenue at the company’s investment information segment, which includes
data, software and research products and is Morningstar’s larger
segment, rose 1.8%. Investment management–which includes all of the
company’s asset management operations–posted a 7 percent jump.

In the U.S., where Morningstar does a bulk of its business, revenue
decreased 5 percent, while it climbed 28 percent internationally.
Registered users of the company’s Web site in the U.S. grew 9.3
percent, although premium subscriptions declined 15 percent.

Earlier this month, Morningstar acquired financial blog Footnoted, a
site focused on digging through Securities and Exchange Commission
filings and finding breaking news. The deal’s terms weren’t disclosed.
Last year, Morningstar completed six acquisitions.

Shares rose 0.2 percent, to $44.69 in after-hours trading.