10-KPeriod: FY2002

EQUIFAX INC Annual Report, Year Ended Dec 31, 2002

Filed March 28, 2003For Securities:EFX

Summary

Equifax Inc.'s 2002 Form 10-K filing reveals a company navigating a challenging economic environment, with consolidated revenues experiencing a slight decline. The company made strategic acquisitions in 2002, including Naviant, Inc. for $135 million and assets from CBC Companies, Inc. for $95 million, aimed at strengthening its marketing and credit data capabilities, respectively. Despite revenue pressures, Equifax North America remained the dominant segment, contributing significantly to operating profit. The company also focused on operational efficiencies and cost management across its segments. Efforts to divest non-core assets and streamline operations, including the exit from commercial services in Spain, were also noted. The company ended the year with a solid cash flow from operations, enabling share repurchases and debt reduction, while managing its liquidity through revolving credit facilities.

Key Highlights

  • 1Consolidated revenues decreased by 3% to $1.1 billion in 2002, impacted by global economic conditions and currency fluctuations.
  • 2Acquired Naviant, Inc. for $135 million to expand marketing services and CBC Companies, Inc. assets for $95 million to bolster credit data.
  • 3Equifax North America, the largest segment, accounted for 81% of revenue and 91% of operating profit before corporate expenses.
  • 4Implemented SFAS 142, ceasing goodwill amortization and undertaking annual impairment testing, which did not result in an impairment charge in 2002.
  • 5Reported income from continuing operations increased significantly due to the absence of prior year restructuring charges and goodwill amortization.
  • 6Maintained strong operating margins, particularly in the Equifax North America segment.
  • 7Generated $248.8 million in cash from operations and $193.0 million in free cash flow, using it for acquisitions, debt reduction, and share repurchases.

Frequently Asked Questions

In 2002, Equifax made significant strategic acquisitions, notably Naviant, Inc. for $135 million, enhancing its direct marketing capabilities, and the credit files and customer relationships of CBC Companies, Inc. for $95 million, strengthening its core credit data business. The company also decided to exit its commercial services business in Spain.

Consolidated revenues saw a slight decrease of 3% to $1.1 billion in 2002 compared to 2001. However, reported income from continuing operations saw a substantial increase of 63% due to the absence of significant restructuring and impairment charges and goodwill amortization that impacted 2001. Adjusted income from continuing operations showed an 8% increase.

The adoption of SFAS 142, 'Goodwill and Other Intangible Assets,' effective January 1, 2002, eliminated the amortization of goodwill. This resulted in a one-time boost to net income and earnings per share in 2002 by removing a significant expense that was present in prior years, allowing for a more direct comparison of operating performance.

International revenues declined by 18% in 2002, primarily due to currency devaluation in Latin America and the decision to exit the commercial reporting business in Spain. While some currency fluctuations provided a benefit in Europe, overall international performance was impacted by economic conditions and strategic decisions.