10-QPeriod: Q1 FY2010

EQUIFAX INC Quarterly Report for Q1 Ended Mar 31, 2010

Filed April 29, 2010For Securities:EFX

Summary

Equifax Inc. reported solid financial results for the first quarter ended March 31, 2010, with operating revenue increasing by 3% year-over-year to $461.3 million. Net income attributable to Equifax rose by 4% to $56.7 million, or $0.44 per diluted share, reflecting improved operating income and a lower effective tax rate. The company demonstrated resilience in a challenging economic environment, with notable revenue growth in its International, TALX, and North America Commercial Solutions segments, partially offsetting a decline in U.S. Consumer Information Solutions. Financially, Equifax maintained a strong liquidity position, with cash provided by operating activities totaling $37.7 million. The company also managed its debt effectively, reducing its overall debt balance. Key investments were made in capital expenditures, including the purchase of its headquarters building. The company is strategically focused on new product innovation, international expansion, and cost management to drive future growth and maintain profitability.

Financial Highlights

52 data points
Beta

Revenue

$443.00M

Net Income

$56.70M

12.8% Net Margin

EPS (Diluted)

$0.44

Total Assets

$3.51B

Cash & Equivalents

$77.10M

Free Cash Flow

$37.70M

Financial Statements
Beta
Revenue$443.00M
SG&A Expenses$109.50M
Operating Expenses$338.70M
Operating Income$104.30M
Interest Expense$14.20M
Net Income$56.70M
EPS (Basic)$0.45
EPS (Diluted)$0.44
Shares Outstanding (Basic)126.30M
Shares Outstanding (Diluted)128.10M

Key Highlights

  • 1Operating revenue increased by 3% to $461.3 million, driven by international growth and the TALX segment.
  • 2Net income attributable to Equifax grew by 4% to $56.7 million, with diluted EPS at $0.44, up from $0.43 in the prior year.
  • 3The U.S. Consumer Information Solutions segment experienced a 6% revenue decline, primarily due to weakness in the credit and mortgage markets.
  • 4International segment revenue grew 15% (3% in local currency), supported by favorable foreign exchange rates and growth in Latin America and Canada.
  • 5TALX segment revenue increased 8%, with strong performance in The Work Number service offsetting a slight decline in Tax and Talent Management.
  • 6The company invested $50.0 million in capital expenditures, including the acquisition of its headquarters building.
  • 7Equifax maintained a strong liquidity position with $708.6 million available under its Senior Credit Facility.

Frequently Asked Questions

Equifax's operating revenue increased by 3% to $461.3 million in the first quarter of 2010, compared to $446.6 million in the first quarter of 2009. This growth was primarily driven by favorable foreign exchange rates and increases in the International and TALX segments.

The U.S. Consumer Information Solutions segment saw a 6% revenue decline due to continued weakness in the U.S. credit and lending environment, and a significant reduction in mortgage application activity. This also impacted the Online Consumer Information Solutions and Mortgage Solutions sub-segments.

Equifax maintained a strong liquidity position, generating $37.7 million in cash from operating activities. The company had $708.6 million available under its Senior Credit Facility. Total debt decreased by approximately 7% to $1,144.2 million at March 31, 2010, from $1,177.0 million at December 31, 2009.

Yes, Equifax sold its Equifax Enabling Technologies LLC legal entity (APPRO loan origination software) on April 23, 2010, for approximately $72 million, expecting to record a gain of about $12 million after tax in the second quarter. Restructuring charges were also lower compared to the prior year, with $4.8 million paid in Q1 2010 related to 2009 charges, and no significant new restructuring charges reported for Q1 2010.