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Equifax Q2 net income falls

23 July 2009  |  1300 views  |  0 Source: Equifax

Equifax (NYSE: EFX) today announced financial results for the quarter ended June 30, 2009.

The company reported revenue of $455.4 million in the second quarter of 2009, a 9 percent decrease from the second quarter of 2008, of which 4 percent was due to the unfavorable effect of foreign exchange rates. Second quarter 2009 net income was $59.6 million, down from $70.8 million in the prior year. Diluted earnings per share ("EPS") for the second quarter of 2009 was $0.47 compared to $0.54 in the same period of the prior year. On a non-GAAP basis, EPS, excluding the impact of acquisition-related amortization expense ("adjusted EPS"), was $0.57 compared to $0.64 in the second quarter of 2008.

"We continued to make good progress on our key strategic initiatives during the second quarter, including leveraging The Work Number and Tax Management Services businesses, innovating new products and expanding mortgage settlement services. For the quarter, TALX delivered strong year-over-year growth, while USCIS was generally consistent with our previous outlook aided by strong mortgage activity during much of the quarter," said Richard F. Smith, Equifax's Chairman and Chief Executive Officer. "However, our International results were adversely affected by weakening economic conditions, while Personal Solutions and North America Commercial Solutions were adversely impacted by the continuing recessionary environment and consumer caution in the U.S. In the face of ongoing softness in the global economy and in demand for credit-related services, we continue to aggressively manage our expenses, diversify our revenue base and invest in our long-term growth strategy. We believe these efforts will position us well for revenue growth when the economy begins to recover."

Second Quarter 2009 Highlights

  • Revenue grew 1 percent on a reported basis versus the first quarter of 2009.
  • Operating margin was 23.5 percent compared to an adjusted operating margin of 24.5 percent in the first quarter of 2009, which excludes the impact of a restructuring charge recorded during the first quarter.
  • Total debt at June 30, 2009, decreased $76.0 million from March 31, 2009.

U.S. Consumer Information Solutions (USCIS)

Total revenue was $211.0 million in the second quarter of 2009, flat when compared to the first quarter of 2009, but an 8 percent decrease from the second quarter of 2008.

  • Online Consumer Information Solutions revenue was $134.8 million, down 11 percent from a year ago.
  • Mortgage Solutions revenue was $28.6 million, up 60 percent from a year ago.
  • Credit Marketing Services revenue was $27.4 million, down 23 percent from a year ago.
  • Direct Marketing Services revenue was $20.2 million, down 15 percent from a year ago.

Operating margin for USCIS was 35.2 percent in the second quarter of 2009, down from 36.0 percent in the first quarter of 2009. Second quarter 2008 operating margin was 38.0 percent.

International

Total revenue was $105.2 million in the second quarter of 2009, a 4 percent increase over the first quarter of 2009, but a 24 percent decrease from the second quarter of 2008. In local currency, revenue was down 2 percent when compared to the first quarter of 2009 and down 8 percent when compared to the same period in the prior year.

  • Latin America revenue was $47.0 million, down 8 percent in local currency and down 23 percent in U.S. dollars from a year ago.
  • Europe revenue was $33.0 million, down 12 percent in local currency and down 29 percent in U.S. dollars from a year ago.
  • Canada Consumer revenue was $25.2 million, down 3 percent in local currency and down 16 percent in U.S. dollars from a year ago.

Operating margin for International was 25.3 percent in the second quarter of 2009, down from 28.7 percent in the first quarter of 2009 and down from 30.6 percent in the second quarter of 2008.

TALX

Total revenue was $86.0 million in the second quarter of 2009, a 12 percent increase from the second quarter of 2008.

  • The Work Number revenue was $39.0 million, up 23 percent from a year ago.
  • Tax and Talent Management Services revenue was $47.0 million, up 4 percent from a year ago. Tax Management Services revenue growth over the prior year more than offset a revenue decline in Talent Management Services.

Operating margin was 23.2 percent, up from 17.7 percent in the second quarter of 2008.

North America Personal Solutions

Total revenue was $37.5 million, a 3 percent decrease from the first quarter of 2009 and a 10 percent decrease from the second quarter of 2008. Operating margin was 21.5 percent, up from 15.5 percent in the first quarter of 2009, but down from 25.1 percent in the second quarter of 2008.

North America Commercial Solutions

Total revenue was $15.7 million, down 3 percent in local currency and down 1 percent in U.S. dollars from the first quarter of 2009. Revenue was down 5 percent in local currency and down 11 percent in U.S. dollars compared to the second quarter of 2008. Operating margin was 15.4 percent, up from 14.4 percent in the first quarter of 2009, but down from 16.0 percent in the second quarter of 2008.

Third Quarter 2009 Outlook

Based on the current level of domestic and international business activity and current foreign exchange rates, adjusted EPS for the third quarter of 2009 is expected to be between $0.52 and $0.57.

View the figures here:

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