Equifax Reports Record Second Quarter 2012 Results

Equifax announced on July 25 financial results for the quarter ended June 30, 2012.  The company reported revenue of $535.8 million in the second quarter of 2012, a 10 percent increase from the second quarter of 2011. On a non-GAAP basis, second quarter revenue was up 14 percent in U.S. dollars and 15 percent in local currency, excluding Brazilian operating results due to the deconsolidation of Brazil in the second quarter of 2011.  

Second quarter diluted EPS attributable to Equifax was $0.62. On a non-GAAP basis, adjusted EPS attributable to Equifax, excluding the loss on the deconsolidation of Brazil and the impact of acquisition-related amortization expense, net of tax, was $0.74, up 21 percent from the second quarter of 2011.

"Broad-based revenue growth and operating performance were ahead of our expectations in the second quarter as our four largest business segments continued to execute well against their strategic objectives," said Richard F. Smith, Equifax's Chairman and Chief Executive Officer. "While mortgage activity continues to be strong, we do expect it to slow down later in 2012. However, the core non-mortgage revenue growth continues to be within the range of our long term business model as our investments in new product innovation and key strategic growth initiatives continue to pay off."


Second Quarter 2012 Highlights

In addition to the financial highlights noted above, second quarter 2012 net income attributable to Equifax was $76.4 million, a 122 percent increase and a 23 percent increase on a non-GAAP basis from the prior year excluding the loss on the deconsolidation of Brazil.
Operating margin was 24.8 percent for the second quarter of 2012, up 130 basis points from the second quarter of 2011.
We repurchased 1.1 million of our common shares on the open market for $51.1 million during the second quarter of 2012.  At June 30, 2012, our remaining authorization for future share repurchases was $261.0 million.
U.S. Consumer Information Solutions (USCIS)

Total revenue was $230.1 million in the second quarter of 2012 compared to $194.0 million in the second quarter of 2011, an increase of 19 percent.

Online Consumer Information Solutions revenue was $153.4 million, up 20 percent from a year ago.
Mortgage Solutions revenue was $40.6 million, up 51 percent from a year ago.
Consumer Financial Marketing Services revenue was $36.1 million, down 9 percent when compared to a year ago.
Operating margin for USCIS was 38.3 percent in the second quarter of 2012 compared to 36.5 percent in the second quarter of 2011.

International

Total revenue was $119.5 million in the second quarter of 2012, a 9 percent decrease from the second quarter of 2011.  On a non-GAAP basis, excluding Brazil, revenue grew 4 percent on a reported basis and 9 percent on a local currency basis.

Latin America revenue was $46.3 million, down 22 percent in U.S. dollars from a year ago.  On a non-GAAP basis, excluding Brazil, revenue grew 12 percent in local currency and 7 percent in U.S. dollars from a year ago.
Europe revenue was $41.3 million, up 11 percent in local currency and 6 percent in U.S. dollars from a year ago.
Canada Consumer revenue was $31.9 million, up 2 percent in local currency and down 2 percent in U.S. dollars from a year ago.
Operating margin for International was 29.2 percent in the second quarter of 2012 compared to 26.1 percent in the second quarter of 2011.

Workforce Solutions

Total revenue was $115.2 million in the second quarter of 2012, a 20 percent increase over the second quarter of 2011.

Verification Services revenue was $63.3 million, up 42 percent when compared to a year ago.
Employer Services revenue was $51.9 million, consistent with a year ago.
Operating margin for Workforce Solutions was 23.4 percent in the second quarter of 2012 compared to 21.6 percent in the second quarter of 2011.

North America Personal Solutions

Revenue was $50.7 million, a 12 percent increase from the second quarter of 2011. Operating margin was 29.8 percent compared to 27.7 percent in the second quarter of 2011.  

North America Commercial Solutions

Revenue was $20.3 million, down 2 percent in U.S. dollars and 1 percent in local currency compared to the second quarter of 2011.  Operating margin was 14.0 percent, compared to 20.9 percent in the second quarter of 2011.

Third Quarter 2012 Outlook

Based on the current level of domestic and international business activity and current foreign exchange rates as well as continued strength in mortgage activity, consolidated revenue for the third quarter of 2012 is expected to be up 9 to 11 percent from the year-ago quarter.  Third quarter 2012 adjusted EPS attributable to Equifax, which excludes the impact of acquisition-related amortization expense, is expected to be between $0.71 and $0.74.

Equifax is a global leader in consumer, commercial and workforce information solutions, that provides businesses of all sizes and consumers with insight and information they can trust. Equifax organizes and assimilates data on more than 500 million consumers and 81 million businesses worldwide, and uses advanced analytics and proprietary technology to create and deliver customized insights that enrich both the performance of businesses and the lives of consumers.

Headquartered in Atlanta, Equifax operates or has investments in 18 countries and is a member of Standard & Poor's (S&P) 500® Index.  Its common stock is traded on the New York Stock Exchange (NYSE) under the symbol EFX. For more information, please visit www.equifax.com

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