content_image/205493.jpg
U  Morningstar Direct had a record year with more than 1,200 new licenses added globally. 

U  Both renewal rates for contract-based products and services and retention rates for subscription products rose substantially com- pared with 2009, reflecting improved business conditions and healthier sales trends across most of our product lines. 

U  Morningstar’s board of directors approved a 5 cent per share initial quarterly dividend and a $100 million share repurchase program, allowing us to return a portion of our cash balance to shareholders. 

## Challenges 

U  Operating expense rose faster than revenue in 2010, leading to a 4.2 percentage point decline in our operating margin, in part because we restored some incentive compensation and benefits after reducing them in 2009. 

U  We have more work to do in fully integrating some of our acqui- sitions and rebranding many of these businesses under the Morningstar umbrella. 

U  While advertising sales on Morningstar.com rebounded strongly U.S. Premium Membership subscriptions were 8% lower year over year as individual investors have been slow to return to the stock market and remain cautious about discretionary spending. 

<img src='content_image/205493.jpg'>

