h 15.9% $479.0  $555.4  $124.7  $121.1  $88.9  $108.6  ($mil) –2.9% Revenue  Operating Income  Free Cash Flow h 22.2% 09  10  09  10  09  10 Letter to Shareholders 200 Our business rebounded in 2010, with improvements in two of our three  operating metrics. 2010 (a 31% increase from 2009), which weighs on earnings but is a non-cash charge. We’re fortunate to be in  a business that generates healthy cash levels and doesn’t require much capital. Our balance sheet remained rock solid. We ended the year with  $365 million of cash and investments,  even after spending  $102 million for acquisitions. While having this much cash may give comfort, it does come at  a cost. Our cash currently earns less than  1%—not a compelling use of your capital. That’s one of the reasons we initiated a dividend and buyback this year. We believe we can fund our organic  initiatives, remain opportunistic with acquisitions, and still have excess capital. We plan to use about $10 million  this year for dividend payments, and we announced a  $100 million share repurchase program.  We believe using our excess cash to purchase Morningstar stock at prices at or below our estimate  of fair value is in the best interests of our shareholders. By doing so, we hope to achieve share count reduction  (beyond offsetting dilution from issuing equity incentives) and deliver tangible value to shareholders. For example, if we were to purchase the entire  $100 million of our stock at $50 per share, each remaining  shareholder would own about  4% more of Morningstar’s total capitalization ($100 million divided by a  $2.5 billion market capitalization). This would also be accretive to earnings because our cash currently earns less  than  1% while Morningstar’s stock has an earnings yield of about 5% ($121 million divided by $2.5 billion).  In addition, a buyback on these terms would add to earnings per share ( EPS) by reducing the share count (the  denominator in the  EPS calculation). Other things equal, the buyback would add about 4% to our EPS. 4