Credit market worries hit Experian

The company was bound to suffer from a slowdown in bank lending - the less money lent, the less checking is needed. Organic sales growth, Experian's most closely watched metric, dropped to 5 per cent year-on-year in the three months to September. That is hardly shattering, given that growth during last year's credit fiesta was just 8 per cent.

True, the company is heavily exposed to two markets under duress: the US, which accounts for three-fifths of group profits, and the UK, which contributes a quarter. But in spite of the gloom in sales of mortgages and unsecured loans, the company says full-year earnings should be unaffected, offset by growth in counter-cyclical businesses such as data analysis and marketing. Geographic diversification is helping: contributions from Brazil-based Serasa, the world's fourth largest consumer credit group, are already ahead of targets.

The share price punishment is in part a consequence of the decision to list Experian in London, rather than New York, home to peers such as Equifax (NYSE:EFX), Fair Isaac and Acxiom. The London listing was a sop to GUS's mainly UK investor base, many of whom could not have held US-listed stock. But the result is that Experian is now poorly understood in Europe and lacks a strong following among US institutions. Often seen by speculative buyers as a lazy proxy for bank stocks, it has underperformed Equifax - its closest rival - by about 15 per cent this year. The company's outlook has undoubtedly worsened, but the core problem seems to be one of communication rather than business performance.