ATLANTA, Oct. 20, 2021 /PRNewswire/ -- Equifax Inc.
(NYSE: EFX) today announced financial results for the quarter ended
September 30, 2021.
- Record third quarter revenue of $1.2
billion, up 14%
- Workforce Solutions revenue growth of 35%; tenth consecutive
quarter of double-digit revenue growth
- Strong new product roll-outs leveraging new EFXCloud
- Executed strategic acquisitions of Appriss Insights, Health
e(fx) and Teletrack which enhance differentiated data, strengthen
Workforce Solutions and broaden ID & Fraud capabilities
- Increasing full-year revenue and EPS guidance
"We continued our strong financial performance with our seventh
consecutive quarter of double-digit revenue growth. Our record
third quarter revenue of $1.223 billion was up 14% and offset the
impact of a decline in the U.S. mortgage market. This growth was
again powered by Workforce Solutions, growing 35%, as well as
strong growth in USIS non-mortgage and International revenue," said
Mark W. Begor, Equifax Chief
Executive Officer. "We are investing our strong outperformance in
almost $3 billion of strategic and
accretive acquisitions this year which will position Equifax for
future growth, including our people-based risk intelligence data
provider Appriss Insights, which we closed just after quarter-end.
The acquisitions enhance the differentiated data 'Only Equifax' can
provide, driving substantial revenue growth and synergies in the
future. Our EFX2023 strategy, leveraging the EFX Cloud to drive
innovation, new products and growth, has positioned us to continue
our strong performance into 2022 and beyond. Based on our very
strong third quarter results, we are again raising our full-year
financial guidance, reflecting revenue to a range of $4.901 billion to $4.921
billion, and Adjusted EPS to a range of $7.52 to $7.62."
Financial Results Summary
The company reported revenue of $1,222.9
million in the third quarter of 2021, up 14 percent compared
to the third quarter of 2020 on a reported basis and 14 percent on
a local currency basis.
Net income attributable to Equifax of $205.4 million was down 10 percent in the third
quarter of 2021 compared to net income attributable to Equifax of
$228.5 million in the third quarter
of 2020.
Diluted EPS attributable to Equifax was $1.66 for the third quarter of 2021, down 11
percent compared to $1.86 in the
third quarter of 2020.
Workforce Solutions third quarter results
- Total revenue was $508.0 million
in the third quarter of 2021, a 35 percent increase compared to the
third quarter of 2020. Operating margin for Workforce Solutions was
49.8 percent in the third quarter of 2021 compared to 51.3 percent
in the third quarter of 2020. Adjusted EBITDA margin for Workforce
Solutions was 54.3 percent in the third quarter of 2021 compared to
57.8 percent in the third quarter of 2020.
- Verification Services revenue was $402.7
million, up 34 percent compared to the third quarter of
2020.
- Employer Services revenue was $105.3
million, up 39 percent compared to the third quarter of
2020.
USIS third quarter results
- Total revenue was $387.8 million
in the third quarter of 2021, flat compared to $386.3 million in the third quarter of 2020.
Operating margin for USIS was 30.1 percent in the third quarter of
2021 compared to 33.3 percent in the third quarter of 2020.
Adjusted EBITDA margin for USIS was 40.1 percent in the third
quarter of 2021 compared to 46.0 percent in the third quarter of
2020.
- Online Information Solutions revenue was $286.3 million, up 1 percent compared to the
third quarter of 2020.
- Mortgage Solutions revenue was $46.2
million, down 17 percent compared to the third quarter of
2020.
- Financial Marketing Services revenue was $55.3 million, up 20 percent compared to the
third quarter of 2020.
International third quarter results
- Total revenue was $245.4 million
in the third quarter of 2021, up 13 percent and up 10 percent
compared to the third quarter of 2020 on a reported and local
currency basis, respectively. Operating margin for International
was 11.4 percent in the third quarter of 2021, compared to 11.6
percent in the third quarter of 2020. Adjusted EBITDA margin for
International was 26.7 percent in the third quarter of 2021,
compared to 32.4 percent in the third quarter of 2020.
- Asia Pacific revenue was
$88.7 million, up 11 percent and up 7
percent compared to the third quarter of 2020 on a reported and
local currency basis, respectively.
- Europe revenue was
$67.7 million, up 15 percent and up 9
percent compared to the third quarter of 2020 on a reported and
local currency basis, respectively.
- Latin America revenue was
$44.6 million, up 11 percent and up
16 percent compared to the third quarter of 2020 on a reported and
local currency basis, respectively.
- Canada revenue was
$44.4 million, up 15 percent and up 8
percent compared to the third quarter of 2020 on a reported and
local currency basis, respectively.
Global Consumer Solutions third quarter results
- Total revenue was $81.7 million
in the third quarter of 2021, down 6 percent and down 7 percent
compared to the third quarter of 2020 on a reported and local
currency basis, respectively. Operating margin was 14.4 percent in
the third quarter of 2021 compared to 14.4 percent in the third
quarter of 2020. Adjusted EBITDA margin was 23.4 percent in the
third quarter of 2021, compared to 24.8 percent in the third
quarter of 2020.
Adjusted EPS and Adjusted EBITDA Margin
- Adjusted EPS attributable to Equifax was $1.85 in the third quarter of 2021, down 3
percent compared to the third quarter of 2020.
- Adjusted EBITDA margin was 33.0 percent in the third quarter of
2021 compared to 37.1 percent in the third quarter of 2020.
- These financial measures exclude adjustments as described
further in the Non-GAAP Financial Measures section below.
2021 Fourth
Quarter and Full Year Guidance
|
|
|
|
Q4
2021
|
|
FY
2021
|
|
Low-End
|
|
High-End
|
|
Low-End
|
|
High-End
|
Reported
Revenue
|
$1,230
million
|
|
$1,250
million
|
|
$4.901
billion
|
|
$4.921
billion
|
Reported Revenue
Growth
|
10.0%
|
|
11.8%
|
|
18.7%
|
|
19.2%
|
Local Currency Growth
(1)
|
9.9%
|
|
11.7%
|
|
17.3%
|
|
17.8%
|
Organic Local
Currency Growth (1)
|
4.5%
|
|
6.3%
|
|
14.2%
|
|
14.7%
|
Adjusted Earnings Per
Share
|
$1.72 per
share
|
|
$1.82 per
share
|
|
$7.52 per
share
|
|
$7.62 per
share
|
|
(1) Refer
to page 9 for definitions.
|
About Equifax
At Equifax (NYSE: EFX), we believe knowledge drives progress. As
a global data, analytics, and technology company, we play an
essential role in the global economy by helping financial
institutions, companies, employers, and government agencies make
critical decisions with greater confidence. Our unique blend of
differentiated data, analytics, and cloud technology drives
insights to power decisions to move people forward. Headquartered
in Atlanta and supported by more
than 11,000 employees worldwide, Equifax operates or has
investments in 24 countries in North
America, Central and South
America, Europe, and the
Asia Pacific region. For more
information, visit Equifax.com.
Earnings Conference Call and Audio Webcast
In conjunction with this release, Equifax will host a conference
call on October 21, 2021 at
8:30 a.m. (ET) via a live audio
webcast. To access the webcast and related presentation materials,
go to the Investor Relations section of our website at
www.equifax.com. The discussion will be available via replay at the
same site shortly after the conclusion of the webcast. This press
release is also available at that website.
Non-GAAP Financial Measures
This earnings release presents adjusted EPS attributable to
Equifax which is diluted EPS attributable to Equifax adjusted (to
the extent noted above for different periods) for
acquisition-related amortization expense, costs related to the 2017
cybersecurity incident (these costs are comprised of legal fees for
2021, and legal fees and incremental costs to transformation our
information technology infrastructure and data security for 2020),
fair value adjustment of equity investments, foreign currency
impact of certain intercompany loans, acquisition-related costs
other than acquisition amortization, income tax effect of stock
awards recognized upon vesting or settlement, Argentina highly inflationary foreign currency
adjustment and income tax effects of Q1 2020 gain on fair market
value adjustment of equity investment. All adjustments are net of
tax, with a reconciling item with the aggregated tax impact of the
adjustments. This earnings release also presents adjusted EBITDA
and adjusted EBITDA margin which is defined as consolidated net
income attributable to Equifax plus net interest expense, income
taxes, depreciation and amortization, and also excludes certain
one-time items. These are important financial measures for Equifax
but are not financial measures as defined by GAAP.
These non-GAAP financial measures should be reviewed in
conjunction with the relevant GAAP financial measures and are not
presented as an alternative measure of net income or EPS as
determined in accordance with GAAP.
Reconciliations of these non-GAAP financial measures to the most
directly comparable GAAP financial measures and related notes are
presented in the Q&A. This information can also be found under
"Investor Relations/Financial Information/Non-GAAP Financial
Measures" on our website at www.equifax.com.
Forward-Looking Statements
This release contains forward-looking statements and
forward-looking information. These statements can be identified by
expressions of belief, expectation or intention, as well as
statements that are not historical fact. These statements are based
on certain factors and assumptions including with respect to
foreign exchange rates, expected growth, results of operations,
performance, the outcome of legal proceedings, business prospects
and opportunities and effective tax rates. While the Company
believes these factors and assumptions to be reasonable based on
information currently available, they may prove to be
incorrect.
Several factors could cause actual results to differ materially
from those expressed or implied in the forward-looking statements,
including, but not limited to, actions taken by us, including
restructuring or strategic initiatives (including our technology,
data and security cloud transformation, capital investments and
asset acquisitions or dispositions), as well as developments beyond
our control, including, but not limited to, the impact of COVID-19
and changes in U.S. and worldwide economic conditions that
materially impact consumer spending, consumer debt and employment
and the demand for Equifax's products and services. The extent to
which the COVID-19 pandemic could negatively impact our operations
will depend on future developments which are highly uncertain and
cannot be predicted with confidence, including the duration of the
outbreak, new information which may emerge concerning the severity
of the COVID-19 pandemic, the actions taken to control the spread
of COVID-19 or treat its impact, and changes in U.S. and worldwide
economic conditions. Further deteriorations in economic conditions,
as a result of COVID-19 or otherwise, could lead to a further or
prolonged decline in demand for our products and services and
negatively impact our business. It may also impact financial
markets and corporate credit markets which could adversely impact
our access to financing or the terms of any financing. We cannot at
this time predict the extent of the impact of the COVID-19 pandemic
and resulting economic impact, but it could have a material adverse
effect on our business, financial position, results of operations
and cash flows. Other risk factors include the impact of our
technology and security transformation and improvements in our
information technology and data security infrastructure; changes in
tax regulations; adverse or uncertain economic conditions and
changes in credit and financial markets; uncertainties regarding
the ultimate amount and timing of payments for the legal
proceedings and government investigations related to the 2017
cybersecurity incident; potential adverse developments in new and
pending legal proceedings or government investigations; risks
associated with our ability to comply with business practice
commitments and similar obligations under settlement agreements and
consent orders entered into in connection with the 2017
cybersecurity incident; economic, political and other risks
associated with international sales and operations; risks relating
to unauthorized access to data or breaches of confidential
information due to criminal conduct, attacks by hackers, employee
or insider malfeasance and/or human error; changes in, and the
effects of, laws and regulations and government policies governing
or affecting our business, including, without limitation, our
examination and supervision by the Consumer Financial Protection
Bureau, a federal agency that holds primary responsibility for the
regulation of consumer protection with respect to financial
products and services in the U.S., oversight by the U.K. Financial
Conduct Authority and Information Commissioner's Office of our debt
collections services and core credit reporting businesses in the
U.K., oversight by the Office of Australian Information Commission,
the Australian Competition and Consumer Commission and other
regulatory entities of our credit reporting business in
Australia and the impact of
current privacy laws and regulations, including the European
General Data Protection Regulation and the California Consumer
Privacy Act, or any future privacy laws and regulations; federal or
state responses to identity theft concerns; our ability to
successfully develop and market new products and services, respond
to pricing and other competitive pressures, complete and integrate
acquisitions and other investments and achieve targeted cost
efficiencies; timing and amount of capital expenditures; changes in
capital markets and corresponding effects on the Company's
investments and benefit plan obligations; foreign currency exchange
rates and earnings repatriation limitations; and the decisions of
taxing authorities which could affect our effective tax rates. A
summary of additional risks and uncertainties can be found in our
Annual Report on Form 10-K for the year ended December 31, 2020 including without limitation
under the captions "Item 1. Business -- Governmental Regulation"
and "-- Forward-Looking Statements" and "Item 1A. Risk Factors,"
and in our other filings with the U.S. Securities and Exchange
Commission. Forward-looking statements are given only as at the
date of this release and the Company disclaims any obligation to
update or revise the forward-looking statements, whether as a
result of new information, future events or otherwise, except as
required by law.
EQUIFAX
CONSOLIDATED STATEMENTS OF INCOME
|
|
|
|
Three Months Ended
September 30,
|
|
|
2021
|
|
2020
|
(In millions, except per share amounts)
|
|
(Unaudited)
|
Operating
revenue
|
|
$
|
1,222.9
|
|
|
$
|
1,068.3
|
|
Operating
expenses:
|
|
|
|
|
Cost of services
(exclusive of depreciation and amortization below)
|
|
489.0
|
|
|
433.2
|
|
Selling, general and
administrative expenses
|
|
344.2
|
|
|
330.0
|
|
Depreciation and
amortization
|
|
116.5
|
|
|
100.7
|
|
Total operating
expenses
|
|
949.7
|
|
|
863.9
|
|
Operating
income
|
|
273.2
|
|
|
204.4
|
|
Interest
expense
|
|
(35.0)
|
|
|
(37.4)
|
|
Other income,
net
|
|
27.2
|
|
|
139.1
|
|
Consolidated income
before income taxes
|
|
265.4
|
|
|
306.1
|
|
Provision for income
taxes
|
|
(58.8)
|
|
|
(76.8)
|
|
Consolidated net
income
|
|
206.6
|
|
|
229.3
|
|
Less: Net income
attributable to noncontrolling interests including redeemable
noncontrolling interests
|
|
(1.2)
|
|
|
(0.8)
|
|
Net income
attributable to Equifax
|
|
$
|
205.4
|
|
|
$
|
228.5
|
|
Basic earnings per
common share:
|
|
|
|
|
Net income
attributable to Equifax
|
|
$
|
1.68
|
|
|
$
|
1.88
|
|
Weighted-average
shares used in computing basic earnings per share
|
|
121.9
|
|
|
121.5
|
|
Diluted earnings per
common share:
|
|
|
|
|
Net income
attributable to Equifax
|
|
$
|
1.66
|
|
|
$
|
1.86
|
|
Weighted-average
shares used in computing diluted earnings per share
|
|
123.7
|
|
|
123.0
|
|
Dividends per common
share
|
|
$
|
0.39
|
|
|
$
|
0.39
|
|
EQUIFAX
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
September 30,
2021
|
|
December 31,
2020
|
(In millions,
except par values)
|
|
(Unaudited)
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
2,025.5
|
|
|
$
|
1,684.6
|
|
Trade accounts
receivable, net of allowance for doubtful accounts of $11.3 and
$12.9 at September 30, 2021 and December 31, 2020,
respectively
|
|
694.6
|
|
|
630.6
|
|
Prepaid
expenses
|
|
120.5
|
|
|
104.1
|
|
Other current
assets
|
|
49.7
|
|
|
59.0
|
|
Total current
assets
|
|
2,890.3
|
|
|
2,478.3
|
|
Property and
equipment:
|
|
|
|
|
Capitalized
internal-use software and system costs
|
|
1,624.2
|
|
|
1,374.5
|
|
Data processing
equipment and furniture
|
|
301.8
|
|
|
299.9
|
|
Land, buildings and
improvements
|
|
245.4
|
|
|
239.1
|
|
Total property
and equipment
|
|
2,171.4
|
|
|
1,913.5
|
|
Less accumulated
depreciation and amortization
|
|
(918.5)
|
|
|
(774.1)
|
|
Total property
and equipment, net
|
|
1,252.9
|
|
|
1,139.4
|
|
Goodwill
|
|
5,169.2
|
|
|
4,495.8
|
|
Indefinite-lived
intangible assets
|
|
95.0
|
|
|
94.9
|
|
Purchased intangible
assets, net
|
|
1,271.6
|
|
|
997.8
|
|
Other assets,
net
|
|
404.3
|
|
|
405.6
|
|
Total
assets
|
|
$
|
11,083.3
|
|
|
$
|
9,611.8
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term debt and
current maturities of long-term debt
|
|
$
|
500.6
|
|
|
$
|
1,101.1
|
|
Accounts
payable
|
|
192.5
|
|
|
159.1
|
|
Accrued
expenses
|
|
213.9
|
|
|
251.8
|
|
Accrued salaries and
bonuses
|
|
222.1
|
|
|
250.3
|
|
Deferred
revenue
|
|
108.1
|
|
|
108.3
|
|
Other current
liabilities
|
|
649.7
|
|
|
612.5
|
|
Total current
liabilities
|
|
1,886.9
|
|
|
2,483.1
|
|
Long-term
debt
|
|
4,969.4
|
|
|
3,277.3
|
|
Deferred income tax
liabilities, net
|
|
372.6
|
|
|
332.3
|
|
Long-term pension and
other postretirement benefit liabilities
|
|
114.3
|
|
|
130.7
|
|
Other long-term
liabilities
|
|
185.0
|
|
|
178.1
|
|
Total
liabilities
|
|
7,528.2
|
|
|
6,401.5
|
|
Preferred stock, $0.01
par value: Authorized shares - 10.0; Issued shares -
none
|
|
—
|
|
|
—
|
|
Common stock, $1.25
par value: Authorized shares - 300.0; Issued shares - 189.3 at September 30, 2021 and
December 31, 2020; Outstanding shares - 122.0 and 121.8 at
September 30, 2021 and December 31, 2020,
respectively
|
|
236.6
|
|
|
236.6
|
|
Paid-in
capital
|
|
1,517.6
|
|
|
1,470.7
|
|
Retained
earnings
|
|
4,677.4
|
|
|
4,185.4
|
|
Accumulated other
comprehensive loss
|
|
(255.7)
|
|
|
(171.4)
|
|
Treasury stock, at
cost, 66.7 and 66.9 shares at September 30, 2021 and
December 31, 2020, respectively
|
|
(2,630.8)
|
|
|
(2,547.0)
|
|
Stock held by
employee benefit trusts, at cost, 0.6 shares at September 30,
2021 and December 31, 2020
|
|
(5.9)
|
|
|
(5.9)
|
|
Total Equifax
shareholders' equity
|
|
3,539.2
|
|
|
3,168.4
|
|
Noncontrolling
interests including redeemable noncontrolling interests
|
|
15.9
|
|
|
41.9
|
|
Total
equity
|
|
3,555.1
|
|
|
3,210.3
|
|
Total liabilities and
equity
|
|
$
|
11,083.3
|
|
|
$
|
9,611.8
|
|
EQUIFAX
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
Nine Months Ended
September 30,
|
|
|
2021
|
|
2020
|
(In
millions)
|
|
(Unaudited)
|
Operating
activities:
|
|
|
|
|
Consolidated net
income
|
|
$
|
625.5
|
|
|
$
|
448.6
|
|
Adjustments to
reconcile consolidated net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
354.9
|
|
|
295.2
|
|
Stock-based
compensation expense
|
|
44.8
|
|
|
43.9
|
|
Deferred income
taxes
|
|
12.6
|
|
|
82.2
|
|
Loss (gain) on fair
market value adjustment of equity investments
|
|
0.1
|
|
|
(162.8)
|
|
Gain on
divestiture
|
|
(0.2)
|
|
|
—
|
|
Changes in assets and
liabilities, excluding effects of acquisitions:
|
|
|
|
|
Accounts receivable,
net
|
|
(54.9)
|
|
|
(76.1)
|
|
Other assets, current
and long-term
|
|
5.1
|
|
|
29.6
|
|
Current and long term
liabilities, excluding debt
|
|
(38.4)
|
|
|
(11.6)
|
|
Cash provided by
operating activities
|
|
949.5
|
|
|
649.0
|
|
Investing
activities:
|
|
|
|
|
Capital
expenditures
|
|
(332.9)
|
|
|
(309.5)
|
|
Acquisitions, net of
cash acquired
|
|
(1,108.9)
|
|
|
(61.4)
|
|
Cash received from
divestiture
|
|
1.5
|
|
|
—
|
|
Investment in
unconsolidated affiliates, net
|
|
—
|
|
|
(10.0)
|
|
Cash used in
investing activities
|
|
(1,440.3)
|
|
|
(380.9)
|
|
Financing
activities:
|
|
|
|
|
Net short-term
borrowings
|
|
499.2
|
|
|
0.3
|
|
Payments on long-term
debt
|
|
(1,100.2)
|
|
|
(125.0)
|
|
Borrowings on long-term
debt
|
|
1,697.3
|
|
|
1,123.3
|
|
Treasury stock
purchases
|
|
(69.9)
|
|
|
—
|
|
Dividends paid to
Equifax shareholders
|
|
(142.6)
|
|
|
(142.1)
|
|
Dividends paid to
noncontrolling interests
|
|
(6.5)
|
|
|
(2.6)
|
|
Proceeds from exercise
of stock options and employee stock purchase plan
|
|
33.4
|
|
|
29.9
|
|
Payment of taxes
related to settlement of equity awards
|
|
(43.9)
|
|
|
—
|
|
Purchase of
noncontrolling interests
|
|
(11.2)
|
|
|
(9.0)
|
|
Debt issuance
costs
|
|
(13.2)
|
|
|
(9.8)
|
|
Other
|
|
—
|
|
|
0.3
|
|
Cash provided by
financing activities
|
|
842.4
|
|
|
865.3
|
|
Effect of foreign
currency exchange rates on cash and cash equivalents
|
|
(10.7)
|
|
|
0.9
|
|
Increase in cash and
cash equivalents
|
|
340.9
|
|
|
1,134.3
|
|
Cash and cash
equivalents, beginning of period
|
|
1,684.6
|
|
|
401.3
|
|
Cash and cash
equivalents, end of period
|
|
$
|
2,025.5
|
|
|
$
|
1,535.6
|
|
Common Questions & Answers (Unaudited)
(Dollars in
millions)
1. Can you provide a further
analysis of operating revenue by operating segment?
Operating revenue consists of the following components:
(In
millions)
|
|
Three Months Ended
September 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
Currency
|
|
Organic Local
Currency
|
Operating
revenue:
|
|
2021
|
|
2020
|
|
$
Change
|
|
%
Change
|
|
% Change
(1)
|
|
% Change
(2)
|
Verification
Services
|
|
$
|
402.7
|
|
|
$
|
301.1
|
|
|
$
|
101.6
|
|
|
34
|
%
|
|
|
|
33
|
%
|
Employer
Services
|
|
105.3
|
|
|
75.7
|
|
|
29.6
|
|
|
39
|
%
|
|
|
|
28
|
%
|
Total Workforce
Solutions
|
|
508.0
|
|
|
376.8
|
|
|
131.2
|
|
|
35
|
%
|
|
|
|
32
|
%
|
Online Information
Solutions
|
|
286.3
|
|
|
284.7
|
|
|
1.6
|
|
|
1
|
%
|
|
|
|
(4)
|
%
|
Mortgage
Solutions
|
|
46.2
|
|
|
55.4
|
|
|
(9.2)
|
|
|
(17)
|
%
|
|
|
|
(17)
|
%
|
Financial Marketing
Services
|
|
55.3
|
|
|
46.2
|
|
|
9.1
|
|
|
20
|
%
|
|
|
|
20
|
%
|
Total U.S. Information
Solutions
|
|
387.8
|
|
|
386.3
|
|
|
1.5
|
|
|
—
|
%
|
|
|
|
(3)
|
%
|
Asia
Pacific
|
|
88.7
|
|
|
80.2
|
|
|
8.5
|
|
|
11
|
%
|
|
7
|
%
|
|
7
|
%
|
Europe
|
|
67.7
|
|
|
58.7
|
|
|
9.0
|
|
|
15
|
%
|
|
9
|
%
|
|
8
|
%
|
Latin
America
|
|
44.6
|
|
|
40.4
|
|
|
4.2
|
|
|
11
|
%
|
|
16
|
%
|
|
16
|
%
|
Canada
|
|
44.4
|
|
|
38.7
|
|
|
5.7
|
|
|
15
|
%
|
|
8
|
%
|
|
8
|
%
|
Total
International
|
|
245.4
|
|
|
218.0
|
|
|
27.4
|
|
|
13
|
%
|
|
10
|
%
|
|
10
|
%
|
Global Consumer
Solutions
|
|
81.7
|
|
|
87.2
|
|
|
(5.5)
|
|
|
(6)
|
%
|
|
(7)
|
%
|
|
(7)
|
%
|
Total operating
revenue
|
|
$
|
1,222.9
|
|
|
$
|
1,068.3
|
|
|
$
|
154.6
|
|
|
14
|
%
|
|
14
|
%
|
|
12
|
%
|
|
|
(1)
|
Local currency
revenue change is calculated by conforming 2021 results using 2020
exchange rates.
|
|
|
(2)
|
Organic local
currency revenue growth is defined as local currency revenue
growth, adjusted to reflect an increase in prior year Equifax
revenue from the revenue of acquired companies in the prior year
period. This adjustment is made for 12 months following the
acquisition.
|
2. What are the costs related to the
technology transformation?
Costs related to the technology transformation are defined as
incremental costs to transform our information technology
infrastructure and data security. From January 1, 2018 through December 31, 2020, these technology
transformation costs were excluded from adjusted net income and
adjusted EBITDA. Beginning in the first quarter of 2021, technology
transformation costs were included in our adjusted net income and
adjusted EBITDA. Technology transformation costs for the third
quarter of 2021 are being provided for comparability to prior
periods. We recorded $44.6 million for the third quarter of 2021
and $83.0 million for the third
quarter of 2020 for technology transformation costs.
3. What is the estimate of the change in
overall U.S. Mortgage Market transaction volume that is included in
the 2021 fourth quarter and full year guidance provided?
Equifax estimates the change year over year in overall U.S.
Mortgage Market transaction volume as being equal to the change in
total U.S. mortgage credit inquiries received by Equifax. The
change year over year in total U.S. mortgage credit inquiries
received by Equifax in the first quarter of 2021 was an increase of
21%, the second quarter of 2021 was a decline of 5% and the third
quarter of 2021 was a decline of 21%. The guidance provided on page
3 assumes a change year over year in total U.S. mortgage credit
inquiries received by Equifax in the fourth quarter of 2021 to be a
decline of approximately 20% and for the full year 2021 to be a
decline of approximately 7%. These percentages provided are rounded
to the nearest whole number.
Reconciliations of Non-GAAP Financial Measures to the
Comparable GAAP Financial Measures (Unaudited)
(Dollars in
millions, except per share amounts)
A. Reconciliation of net income
attributable to Equifax to diluted EPS attributable to Equifax,
defined as net income adjusted for acquisition-related amortization
expense, costs related to the 2017 cybersecurity incident, fair
value adjustment of equity investments, foreign currency impact of
certain intercompany loans, acquisition-related costs other than
acquisition amortization, income tax effect of stock awards
recognized upon vesting or settlement, Argentina highly inflationary foreign currency
adjustment, income tax effects of Q1 2020 gain on fair market value
adjustment of equity investment and income tax adjustments:
|
|
Three Months Ended
September 30,
|
|
|
|
|
(In millions,
except per share amounts)
|
|
2021
|
|
2020
|
|
$ Change
|
|
% Change
|
Net income
attributable to Equifax
|
|
$
|
205.4
|
|
|
$
|
228.5
|
|
|
$
|
(23.1)
|
|
|
(10)
|
%
|
Acquisition-related
amortization expense of certain acquired intangibles
(1)
|
|
40.1
|
|
|
36.0
|
|
|
4.1
|
|
|
11
|
%
|
2017 cybersecurity
incident related costs (2)
|
|
0.1
|
|
|
83.7
|
|
|
(83.6)
|
|
|
nm
|
Fair market value
adjustment of equity investments (3)
|
|
(17.3)
|
|
|
(129.9)
|
|
|
112.6
|
|
|
nm
|
Foreign currency
impact of certain intercompany loans (4)
|
|
(0.8)
|
|
|
0.1
|
|
|
(0.9)
|
|
|
nm
|
Acquisition-related
costs other than acquisition amortization (5)
|
|
6.5
|
|
|
—
|
|
|
6.5
|
|
|
nm
|
Income tax effects of
stock awards that are recognized upon vesting or settlement
(6)
|
|
(2.8)
|
|
|
(0.3)
|
|
|
(2.5)
|
|
|
nm
|
Argentina highly
inflationary foreign currency adjustment (7)
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
nm
|
Income tax effects of
Q1 2020 gain on fair market value adjustment of equity investment
(8)
|
|
—
|
|
|
(1.5)
|
|
|
1.5
|
|
|
nm
|
Tax impact of
adjustments (9)
|
|
(2.6)
|
|
|
18.0
|
|
|
(20.6)
|
|
|
nm
|
Net income
attributable to Equifax, adjusted for items listed above
|
|
$
|
228.7
|
|
|
$
|
234.7
|
|
|
$
|
(6.0)
|
|
|
(3)
|
%
|
Diluted EPS
attributable to Equifax, adjusted for the items listed
above
|
|
$
|
1.85
|
|
|
$
|
1.91
|
|
|
$
|
(0.06)
|
|
|
(3)
|
%
|
Weighted-average
shares used in computing diluted EPS
|
|
123.7
|
|
|
123.0
|
|
|
|
|
|
|
|
nm - not
meaningful
|
|
(1)
|
During the third
quarter of 2021, we recorded acquisition-related amortization
expense of certain acquired intangibles of $40.1 million
($33.9 million, net of tax). We calculate this financial
measure by excluding the impact of acquisition-related amortization
expense and including a benefit to reflect the significant cash
income tax savings resulting from the income tax deductibility of
amortization for certain acquired intangibles. The
$6.2 million of tax is comprised of $10.2 million of tax
expense net of $4.0 million of a cash income tax benefit.
During the third quarter of 2020, we recorded acquisition-related
amortization expense of certain acquired intangibles of
$36.0 million ($30.6 million, net of tax). The
$5.4 million of tax is comprised of $9.4 million of tax
expense net of $4.0 million of a cash income tax benefit. See
the Notes to this reconciliation for additional detail.
|
|
(2)
|
During the third
quarter of 2021, we recorded legal fees related to the 2017
cybersecurity incident of $0.1 million ($0.1 million, net
of tax). During the third quarter of 2020, we recorded pre-tax
expenses related to the 2017 cybersecurity incident of
$83.7 million ($63.0 million, net of tax).
$83.0 million of these expenses related to incremental costs
to transform our information technology infrastructure and data
security and the remaining $0.7 million related to 2017
cybersecurity incident legal fees. See the Notes to this
reconciliation for additional detail.
|
|
(3)
|
During the third
quarter of 2021, we recorded an unrealized gain on the fair market
value adjustment of an equity investment of $17.3 million
($12.1 million, net of tax). During the third quarter of 2020,
we recorded a gain on the fair market value adjustment of an equity
investment of $129.9 million ($85.8 million, net of tax). The
fair value adjustments were recorded to the Other income, net line
item within the Consolidated Statements of Income. See the Notes to
this reconciliation for additional details.
|
|
(4)
|
During the third
quarter of 2021, we recorded foreign currency gains on certain
intercompany loans of $0.8 million. During the third quarter
of 2020, we recorded foreign currency losses on certain
intercompany loans of $0.1 million. The impact was recorded to
the Other income, net line item within the Consolidated Statements
of Income. See the Notes to this reconciliation for additional
detail.
|
|
(5)
|
During the third
quarter of 2021, we recorded $6.5 million ($4.9 million,
net of tax) for acquisition costs other than acquisition-related
amortization. These costs primarily related to transaction and
integration costs resulting from recent acquisitions and were
recorded in operating income. See the Notes to this reconciliation
for additional detail.
|
|
(6)
|
During the third
quarter of 2021, we recorded a tax benefit of $2.8 million
related to the tax effects of deductions for stock compensation in
excess of amounts recorded for compensation costs. During the third
quarter of 2020, we recorded a tax benefit of $0.3 million
related to the tax effects of deductions for stock compensation
expense in excess of amounts recorded for compensation costs. See
the Notes to this reconciliation for additional detail.
|
|
(7)
|
Argentina experienced
multiple periods of increasing inflation rates, devaluation of the
peso, and increasing borrowing rates. As such, Argentina was deemed
a highly inflationary economy by accounting policymakers. During
both the third quarter of 2021 and third quarter of 2020, we
recorded foreign currency losses of $0.1 million related to
the impact of remeasuring the peso denominated monetary assets and
liabilities as a result of Argentina being a highly inflationary
economy. See the Notes to this reconciliation for additional
detail.
|
|
(8)
|
During the third
quarter of 2020, we recorded income tax effects of the Q1 2020 gain
on fair market value adjustment of equity investment of $1.5
million. See the Notes to this reconciliation for additional
detail.
|
|
(9)
|
During the third
quarter of 2021, we recorded the tax impact of adjustments of
$2.6 million comprised of (i) acquisition-related amortization
expense of certain acquired intangibles of $6.2 million
($10.2 million of tax expense net of $4.0 million of cash
income tax benefit), (ii) a tax adjustment of $5.2 million
related to the gain on fair market value adjustment of equity
investments and (iii) a tax adjustment of $1.6 million related
to acquisition costs other than acquisition-related
amortization.
|
|
|
|
During the third
quarter of 2020, we recorded the tax impact of adjustments of
$18.0 million comprised of (i) acquisition-related
amortization expense of certain acquired intangibles of
$5.4 million ($9.4 million of tax expense net of
$4.0 million of cash income tax benefit), (ii) a tax
adjustment of $20.7 million related to expenses for the 2017
cybersecurity incident, and (iii) a tax adjustment of
$44.1 million related to the gain on fair market value
adjustment of an equity investment.
|
B. Reconciliation of net income
attributable to Equifax to adjusted EBITDA, defined as net income
excluding income taxes, interest expense, net, depreciation and
amortization expense, costs related to the 2017 cybersecurity
incident, fair value adjustment of equity investments, foreign
currency impact of certain intercompany loans, acquisition-related
costs other than acquisition amortization, Argentina highly inflationary foreign currency
adjustment, and presentation of adjusted EBITDA
margin:
|
|
Three Months Ended
September 30,
|
|
|
|
|
(in
millions)
|
|
2021
|
|
2020
|
|
$
Change
|
|
%
Change
|
Revenue
|
|
$
|
1,222.9
|
|
|
$
|
1,068.3
|
|
|
$
|
154.6
|
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Equifax
|
|
$
|
205.4
|
|
|
$
|
228.5
|
|
|
$
|
(23.1)
|
|
|
(10)
|
%
|
Income
taxes
|
|
58.8
|
|
|
76.8
|
|
|
(18.0)
|
|
|
(23)
|
%
|
Interest expense,
net*
|
|
34.6
|
|
|
36.8
|
|
|
(2.2)
|
|
|
(6)
|
%
|
Depreciation and
amortization
|
|
116.5
|
|
|
100.7
|
|
|
15.8
|
|
|
16
|
%
|
2017 cybersecurity
incident related costs (1)
|
|
0.1
|
|
|
83.7
|
|
|
(83.6)
|
|
|
nm
|
Fair market value
adjustment of equity investments (2)
|
|
(17.3)
|
|
|
(129.9)
|
|
|
112.6
|
|
|
nm
|
Foreign currency
impact of certain intercompany loans (3)
|
|
(0.8)
|
|
|
0.1
|
|
|
(0.9)
|
|
|
nm
|
Acquisition-related
costs other than acquisition amortization (4)
|
|
6.5
|
|
|
—
|
|
|
6.5
|
|
|
nm
|
Argentina highly
inflationary foreign currency adjustment (5)
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
nm
|
Adjusted EBITDA,
excluding the items listed above
|
|
$
|
403.9
|
|
|
$
|
396.8
|
|
|
$
|
7.1
|
|
|
2
|
%
|
Adjusted EBITDA
margin
|
|
33.0
|
%
|
|
37.1
|
%
|
|
|
|
|
|
|
|
nm - not
meaningful
|
|
*Excludes interest
income of $0.4 million in 2021 and $0.6 million 2020.
|
|
|
(1)
|
During the third
quarter of 2021, we recorded legal fees related to the 2017
cybersecurity incident of $0.1 million ($0.1 million, net
of tax). During the third quarter of 2020, we recorded pre-tax
expenses related to the 2017 cybersecurity incident of
$83.7 million ($63.0 million, net of tax).
$83.0 million of these expenses related to incremental costs
to transform our information technology infrastructure and data
security and the remaining $0.7 million related to 2017
cybersecurity incident legal fees. See the Notes to this
reconciliation for additional detail.
|
|
|
(2)
|
During the third
quarter of 2021, we recorded an unrealized gain on the fair market
value adjustment of an equity investment of $17.3 million
($12.1 million, net of tax). During the third quarter of 2020,
we recorded a gain on the fair market value adjustment of an equity
investment of $129.9 million ($85.8 million, net of tax). The
fair value adjustments were recorded to the Other income, net line
item within the Consolidated Statements of Income. See the Notes to
this reconciliation for additional details.
|
|
|
(3)
|
During the third
quarter of 2021, we recorded foreign currency gains on certain
intercompany loans of $0.8 million. During the third quarter
of 2020, we recorded foreign currency losses on certain
intercompany loans of $0.1 million. The impact was recorded to
the Other income, net line item within the Consolidated Statements
of Income. See the Notes to this reconciliation for additional
detail.
|
|
|
(4)
|
During the third
quarter of 2021, we recorded $6.5 million ($4.9 million,
net of tax) for acquisition costs other than acquisition-related
amortization. These costs primarily related to transaction and
integration costs resulting from recent acquisitions and were
recorded in operating income. See the Notes to this reconciliation
for additional detail.
|
|
|
(5)
|
Argentina experienced
multiple periods of increasing inflation rates, devaluation of the
peso, and increasing borrowing rates. As such, Argentina was deemed
a highly inflationary economy by accounting policymakers. During
both the third quarter of 2021 and third quarter of 2020, we
recorded foreign currency losses of $0.1 million related to
the impact of remeasuring the peso denominated monetary assets and
liabilities as a result of Argentina being a highly inflationary
economy. See the Notes to this reconciliation for additional
detail.
|
C. Reconciliation of operating income by
segment to Adjusted EBITDA, excluding depreciation and amortization
expense, other income, net, noncontrolling interest, costs related
to the 2017 cybersecurity incident, fair value adjustment of equity
investments, foreign currency impact of certain intercompany loans,
acquisition-related costs other than acquisition amortization,
Argentina highly inflationary
foreign currency adjustment, and presentation of adjusted EBITDA
margin for each of the segments:
(In
millions)
|
Three Months Ended
September 30, 2021
|
|
|
Workforce
Solutions
|
|
U.S.
Information
Solutions
|
|
International
|
|
Global
Consumer
Solutions
|
|
General
Corporate
Expense
|
|
Total
|
|
|
|
|
|
|
Revenue
|
|
$
|
508.0
|
|
|
$
|
387.8
|
|
|
$
|
245.4
|
|
|
$
|
81.7
|
|
|
—
|
|
|
$
|
1,222.9
|
|
Operating
income
|
|
253.1
|
|
|
116.7
|
|
|
27.9
|
|
|
11.8
|
|
|
(136.3)
|
|
|
273.2
|
|
Depreciation and
amortization
|
|
22.5
|
|
|
36.6
|
|
|
32.4
|
|
|
7.3
|
|
|
17.7
|
|
|
116.5
|
|
Other income,
net*
|
|
—
|
|
|
0.7
|
|
|
23.3
|
|
|
—
|
|
|
2.8
|
|
|
26.8
|
|
Noncontrolling
interest
|
|
—
|
|
|
—
|
|
|
(1.2)
|
|
|
—
|
|
|
—
|
|
|
(1.2)
|
|
Adjustments
(1)
|
|
0.2
|
|
|
1.4
|
|
|
(16.8)
|
|
|
—
|
|
|
3.8
|
|
|
(11.4)
|
|
Adjusted
EBITDA
|
|
$
|
275.8
|
|
|
$
|
155.4
|
|
|
$
|
65.6
|
|
|
$
|
19.1
|
|
|
$
|
(112.0)
|
|
|
$
|
403.9
|
|
Operating
margin
|
|
49.8
|
%
|
|
30.1
|
%
|
|
11.4
|
%
|
|
14.4
|
%
|
|
nm
|
|
22.3
|
%
|
Adjusted EBITDA
margin
|
|
54.3
|
%
|
|
40.1
|
%
|
|
26.7
|
%
|
|
23.4
|
%
|
|
nm
|
|
33.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
nm - not
meaningful
|
*Excludes interest
income of $0.3 million in International and $0.1 million in General
Corporate Expense.
|
(In
millions)
|
|
Three Months Ended
September 30, 2020
|
|
|
Workforce
Solutions
|
|
U.S.
Information
Solutions
|
|
International
|
|
Global
Consumer
Solutions
|
|
General
Corporate
Expense
|
|
Total
|
|
|
|
|
|
|
Revenue
|
|
$
|
376.8
|
|
|
$
|
386.3
|
|
|
$
|
218.0
|
|
|
$
|
87.2
|
|
|
—
|
|
|
$
|
1,068.3
|
|
Operating
income
|
|
193.2
|
|
|
128.6
|
|
|
25.4
|
|
|
12.5
|
|
|
(155.3)
|
|
|
204.4
|
|
Depreciation and
amortization
|
|
18.0
|
|
|
29.2
|
|
|
33.8
|
|
|
5.0
|
|
|
14.7
|
|
|
100.7
|
|
Other income,
net*
|
|
—
|
|
|
0.7
|
|
|
134.7
|
|
|
—
|
|
|
3.1
|
|
|
138.5
|
|
Noncontrolling
interest
|
|
—
|
|
|
—
|
|
|
(0.8)
|
|
|
—
|
|
|
—
|
|
|
(0.8)
|
|
Adjustments
(1)
|
|
6.5
|
|
|
19.0
|
|
|
(122.4)
|
|
|
4.1
|
|
|
46.8
|
|
|
(46.0)
|
|
Adjusted
EBITDA
|
|
$
|
217.7
|
|
|
$
|
177.5
|
|
|
$
|
70.7
|
|
|
$
|
21.6
|
|
|
$
|
(90.7)
|
|
|
$
|
396.8
|
|
Operating
margin
|
|
51.3
|
%
|
|
33.3
|
%
|
|
11.6
|
%
|
|
14.4
|
%
|
|
nm
|
|
19.1
|
%
|
Adjusted EBITDA
margin
|
|
57.8
|
%
|
|
46.0
|
%
|
|
32.4
|
%
|
|
24.8
|
%
|
|
nm
|
|
37.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
nm - not
meaningful
|
*Excludes interest
income of $0.3 million in International and $0.3 million in General
Corporate Expense.
|
|
|
(1)
|
During the third
quarter of 2021, we recorded $0.1 million in legal fees
related to the 2017 cybersecurity incident, a $17.3 million
unrealized gain on the fair value adjustment of an equity
investment, a $0.8 million positive foreign currency impact of
certain intercompany loans, $6.5 million in acquisition costs
other than acquisition-related amortization, and a foreign currency
loss of $0.1 million related to the impact of remeasuring the peso
denominated monetary assets and liabilities as a result of
Argentina being a highly inflationary economy.
|
|
|
|
During the third
quarter of 2020, we recorded pre-tax expenses, excluding
depreciation and amortization, related to the 2017 cybersecurity
incident of $83.7 million, a $129.9 million gain on the fair value
adjustment of an equity investment, a $0.1 million foreign currency
impact of certain intercompany loans, and a foreign currency loss
of $0.1 million related to the impact of remeasuring the peso
denominated monetary assets and liabilities as a result of
Argentina being a highly inflationary economy.
|
Notes to Reconciliations of Non-GAAP Financial Measures to
the Comparable GAAP Financial Measures
Diluted EPS attributable to Equifax is adjusted for the
following items:
Acquisition-related amortization expense - We calculate
this financial measure by excluding the impact of
acquisition-related amortization expense and including a benefit to
reflect the material cash income tax savings resulting from the
income tax deductibility of amortization for certain acquired
intangibles. These financial measures are not prepared in
conformity with GAAP. Management believes excluding the impact of
amortization expense is useful because excluding
acquisition-related amortization, and other items that are not
comparable allows investors to evaluate our performance for
different periods on a more comparable basis. Certain acquired
intangibles result in material cash income tax savings which are
not reflected in earnings. Management believes that including a
benefit to reflect the cash income tax savings is useful as it
allows investors to better value Equifax. Management makes these
adjustments to earnings when measuring profitability, evaluating
performance trends, setting performance objectives and calculating
our return on invested capital.
Costs related to the 2017 cybersecurity incident -
Costs related to the 2017 cybersecurity incident include legal fees
to respond to subsequent litigation and government investigations.
Through the year ended December 31,
2020, these costs also included incremental costs to
transform our information technology, data security and
infrastructure. During the third quarters of 2021 and 2020, we
recorded expenses of $0.1 million ($0.1 million, net of tax) and $83.7 million ($63.0 million, net of tax), respectively.
Management believes excluding these charges is useful as it allows
investors to evaluate our performance for different periods on a
more comparable basis. Management makes these adjustments to net
income when measuring profitability, evaluating performance trends,
setting performance objectives and calculating our return on
invested capital. This is consistent with how management reviews
and assesses Equifax's historical performance and is useful when
planning, forecasting and analyzing future periods. Costs related
to the 2017 cybersecurity incident do not include losses accrued
for certain legal proceedings and government investigations related
to the 2017 cybersecurity incident.
Fair market value adjustment of equity investments -
During the third quarter of 2021 and 2020, we recorded a
$17.3 million ($12.1 million, net of tax) and $129.9 million ($85.8 million, net of tax) unrealized gain,
respectively, related to adjusting our investment in Brazil to fair value. The investment had
previously been recorded on our books at cost less impairment, as
it did not have a readily determinable fair value. Subsequent to
the initial public offering, our investment in Brazil has been adjusted to fair value, and
will continue to be adjusted to fair value at the end of each
reporting period, with unrealized gains or losses to be recorded
within the Consolidated Statements of Income in Other income, net.
Management believes excluding these charges from certain financial
results provides meaningful supplemental information regarding our
financial results for the three months ended September 30,
2021, since the non-operating gains or losses are not comparable
among the periods. This is consistent with how our management
reviews and assesses Equifax's historical performance and is useful
when planning, forecasting and analyzing future periods.
Foreign currency impact of certain intercompany loans
- During the third quarter of 2021 and 2020, we recorded a
$0.8 million gain and a $0.1 million loss, respectively, related to
foreign currency impact of certain intercompany loans. Management
believes excluding this charge is useful as it allows investors to
evaluate our performance for different periods on a more comparable
basis. This is consistent with how management reviews and assesses
Equifax's historical performance and is useful when planning,
forecasting and analyzing future periods.
Acquisition-related costs other than acquisition
amortization - During the third quarter of 2021, we
recorded $6.5 million
($4.9 million, net of tax) for
acquisition costs other than acquisition-related amortization.
These costs primarily related to transaction and integration costs
resulting from recent acquisitions and were recorded in operating
income. Management believes excluding this charge from certain
financial results provides meaningful supplemental information
regarding our financial results, since a charge of such an amount
is not comparable among the periods. This is consistent with how
our management reviews and assesses Equifax's historical
performance and is useful when planning, forecasting, and analyzing
future periods.
Income tax effects of stock awards that are recognized upon
vesting or settlement - During the third quarter of 2021,
we recorded a tax benefit of $2.8
million related to the tax effects of deductions for stock
compensation in excess of amounts recorded for compensation costs.
During the third quarter of 2020, we recorded a tax benefit of
$0.3 million related to the tax
effects of deductions for stock compensation expense in excess of
amounts recorded for compensation costs. Management believes
excluding this tax effect from financial results provides
meaningful supplemental information regarding our financial results
for the three months ended September 30, 2021 and 2020 because
these amounts are non-operating and relate to income tax benefits
or deficiencies for stock awards recognized when tax amounts differ
from recognized stock compensation cost. This is consistent with
how management reviews and assesses Equifax's historical
performance and is useful when planning, forecasting and analyzing
future periods.
Argentina highly
inflationary foreign currency adjustment - Argentina
experienced multiple periods of increasing inflation rates,
devaluation of the peso, and increasing borrowing rates. As such,
Argentina was deemed a highly
inflationary economy by accounting policymakers. We recorded
foreign currency losses of $0.1
million during the third quarter of 2021 and $0.1 million during the third quarter of 2020 as
a result of remeasuring the peso denominated monetary assets and
liabilities due to Argentina being
highly inflationary. Management believes excluding these charges
are useful as it allows investors to evaluate our performance for
different periods on a more comparable basis. This is consistent
with how management reviews and assesses Equifax's historical
performance and is useful when planning, forecasting and analyzing
future periods.
Income tax effects of Q1 2020 gain on fair market value
adjustment of equity investment - During the first quarter of
2020, we recorded a gain related to adjusting our equity method
investment in India, in
conjunction with the purchase of the remaining interest of our
joint venture. Prior to the purchase of the remaining interest,
Equifax did not have control over the joint venture. As a result of
the transaction, Equifax recognized a gain related to the
remeasurement of the preexisting equity interest in the
India joint venture at the
acquisition-date fair value of the business combination. Additional
income tax effects related to this transaction were recorded in the
third quarter of 2020. Management believes excluding this gain and
related income tax effects from certain financial results provides
meaningful supplemental information regarding our financial results
for the three months ended September 30,
2020, since the non-operating gain is not comparable among
the periods. This is consistent with how our management reviews and
assesses Equifax's historical performance and is useful when
planning, forecasting and analyzing future periods.
Adjusted EBITDA and EBITDA margin - Management
defines adjusted EBITDA as consolidated net income attributable to
Equifax plus net interest expense, income taxes, depreciation and
amortization, and also excludes certain one-time items. Management
believes the use of adjusted EBITDA and adjusted EBITDA margin
allows investors to evaluate our performance for different periods
on a more comparable basis.
Contact:
|
|
|
|
Dorian
Hare
|
Kate
Walker
|
Investor
Relations
|
Media
Relations
|
(404)
885-8210
|
mediainquiries@equifax.com
|
dorian.hare@equifax.com
|
|
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SOURCE Equifax Inc.