Equifax Reports Strong Revenue and Earnings in First Quarter of 2007, Driven by Broad-based Growth across All Operating Segments
ATLANTA, April 23, 2007 -- Equifax Inc. (NYSE: EFX) today reported first quarter of 2007 earnings. Revenue increased to $405.1 million, up 8 percent compared to the first quarter of 2006. Net income rose to $69.0 million, a 10 percent increase from the first quarter of 2006. Diluted earnings per share (“EPS”) grew to 54 cents, a 13 percent increase from the first quarter of 2006.
”Equifax achieved outstanding financial performance across all business units this quarter. Our broad-based growth exemplifies our commitment to deliver shareholder value even in a changing economic landscape,” said Richard F. Smith, Equifax Chairman and Chief Executive Officer. “Our solid first quarter results lay the foundation for a strong performance in 2007. We also fulfilled an important strategic initiative with our agreement to acquire TALX Corporation, positioning Equifax for long-term sustainable growth in revenue and cash flow.”
First Quarter 2007 Highlights
- Solid double-digit revenue growth in three of four operating segments contributed to an 8 percent increase in revenue in the first quarter of 2007, when compared to the same period in 2006.
- Operating margin was strong at 28.9 percent compared to 29.2 percent in the first quarter of 2006.
- Operating income grew to $117.0 million, up 7 percent from the first quarter of 2006. EBITDA, a non-GAAP financial measure, grew to $138.4 million, up 6 percent from the first quarter of 2006. See the reconciliations of non-GAAP financial measures attached to this earnings release for additional information.
- Total debt decreased $48.0 million to $455.9 million in the first quarter of 2007, a 10 percent decrease compared to fourth quarter of 2006.
- On February 14, 2007, we announced a definitive agreement to acquire TALX Corporation, a leading provider of payroll-related and human resources business process outsourcing services, for $1.4 billion, including debt that will be assumed. This acquisition is expected to be completed during the second quarter of 2007.
U.S. Consumer Information Solutions
Total revenue was $247.1 million in the first quarter of 2007, a 3 percent increase from the first quarter of 2006. Operating margin for U.S. Consumer Information Solutions was 41.2 percent in the first quarter of 2007 versus 41.5 percent in the first quarter of 2006.
- Online Consumer Information Solutions revenue was $162.1 million, up 5 percent compared to the first quarter of 2006.
- Mortgage Reporting Solutions revenue decreased to $17.5 million, down 13 percent compared to the first quarter of 2006.
- Credit Marketing Services revenue was $40.4 million, up 2 percent compared to the first quarter of 2006.
- Direct Marketing Services revenue was $27.1 million, up 5 percent compared to the first quarter of 2006.
International
Total revenue was $105.6 million in the first quarter of 2007, a 14 percent increase from the first quarter of 2006. In local currency, revenue was up 9 percent when compared to the same period in the prior year. Operating margin for International was 30.7 percent in the first quarter of 2007, up from 28.9 percent in the first quarter of 2006.
- Europe revenue was $42.2 million, up 21 percent compared to the first quarter of 2006. In local currency, revenue was up 9 percent when compared to the same period in the prior year.
- Latin America revenue was $39.6 million, up 13 percent compared to the first quarter of 2006. In local currency, revenue was up 12 percent when compared to the same period in the prior year.
- Canada Consumer revenue was $23.8 million, up 5 percent compared to the first quarter of 2006. In local currency, revenue was up 6 percent when compared to the same period in the prior year.
North America Personal Solutions
Total revenue rose to $38.0 million, a 24 percent increase from the first quarter of 2006. Operating margin was 16.5 percent, up from 2.9 percent in the first quarter of 2006.
North America Commercial Solutions
Total revenue rose to $14.4 million, a 41 percent increase from the first quarter of 2006. Operating margin was 9.4 percent, down from 12.2 percent in the first quarter of 2006.
About Equifax
Equifax empowers businesses and consumers with information they can trust. A global leader in information solutions, we leverage one of the largest sources of consumer and commercial data, along with advanced analytics and proprietary technology, to create customized insights that enrich both the performance of businesses and the lives of consumers.
Customers have trusted Equifax for over 100 years to deliver innovative solutions with the highest integrity and reliability. Businesses – large and small – rely on us for consumer and business credit intelligence, portfolio management, fraud detection, decisioning technology, marketing tools, and much more. We empower individual consumers to manage their personal credit information, protect their identity and maximize their financial well-being.
Headquartered in Atlanta, Georgia, Equifax Inc. employs approximately 5,000 people in 14 countries throughout North America, Latin America and Europe. Equifax is a member of Standard & Poor’s (S&P) 500® Index. Our common stock is traded on the New York Stock Exchange under the symbol EFX.
Earnings Conference Call and Webcast
Equifax's quarterly teleconference to discuss the first quarter earnings release will be held tomorrow, April 24, at 8:30 a.m. (EDT). The live audio Webcast of the speakers’ presentations will be available at www.equifax.com and a replay will be available at the same site shortly after the conclusion of the Webcast. This press release, the financial tables, as well as other supplemental information, are also available at that Web site.
Supplemental Financial Information and Non-GAAP Financial Measures
The Common Questions and Answers (Unaudited) (“Q&A”) that are a part of this press release include supplemental financial information which Equifax believes is useful to assess its operating performance. The following financial measures included herein or in the Q&A are not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”): EBITDA, defined as operating income adding back depreciation and amortization expense, and diluted EPS, adjusted for acquisition-related amortization expense. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures and related notes are presented in the Q&A. This information can also be found under "Our Company/Investor Center/Non-GAAP/GAAP Financial Measures" on our Web site at www.equifax.com. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
Caution Concerning Forward-Looking Statements
Statements in this press release that relate to Equifax's future plans, objectives, expectations, performance, events and the like may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Future events, risks and uncertainties, individually or in the aggregate, could cause our actual results to differ materially from those expressed or implied in these forward-looking statements. Those factors include, but are not limited to, changes in worldwide and U.S. economic conditions that materially impact consumer spending and consumer debt, changes in demand for Equifax's products and services, our ability to develop new products and services, pricing and other competitive pressures, risks relating to illegal third party efforts to access data, risks associated with our ability to complete and integrate acquisitions and other investments, changes in laws and regulations governing our business, including federal or state responses to identity theft concerns, the outcome of pending litigation, the impact of tax audits by the IRS or other taxing authorities, and certain other factors discussed under the caption "Risk Factors" in the Management's Discussion and Analysis section of Equifax's Annual Report on Form 10-K for the year ended December 31, 2006, and in our other filings with the Securities and Exchange Commission. Equifax assumes no obligation to update any forward-looking statements to reflect events that occur or circumstances that exist after the date on which they were made.
Jeff Dodge
Investor Relations
(404) 885-8804
jeff.dodge@equifax.com
David Rubinger
Media Relations
(404) 885-8555
david.rubinger@equifax.com
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