TransUnion (NYSE: TRU) (the “Company”) today announced financial
results for the quarter and full-year ended December 31, 2023.
Fourth Quarter
2023 Results
Revenue:
- Total revenue for
the quarter was $954 million, an increase of 6 percent (5 percent
on an organic constant currency basis), compared with the fourth
quarter of 2022.
Earnings:
- Net income
attributable to TransUnion was $6 million for the quarter, compared
with $46 million for the fourth quarter of 2022. Diluted earnings
per share was $0.03, compared with $0.24 in the fourth quarter of
2022. Net income attributable to TransUnion margin was 1 percent,
compared with 5 percent in the fourth quarter of 2022. Our fourth
quarter 2023 net income attributable to TransUnion, diluted
earnings per share and net income attributable to TransUnion margin
include expenses associated with our transformation plan, as
described below.
- Adjusted Net Income
was $156 million for the quarter, compared with $152
million for the fourth quarter of 2022. Adjusted Diluted
Earnings per Share for the quarter was $0.80, compared with
$0.78 in the fourth quarter of 2022.
- Adjusted EBITDA was
$326 million for the quarter, an increase of 1 percent (1 percent
on a constant currency basis) compared with the fourth quarter of
2022. Adjusted EBITDA margin was 34 percent, compared with 36
percent in the fourth quarter of 2022.
“TransUnion ended the year by exceeding our fourth quarter
financial guidance for revenue, Adjusted EBITDA and Adjusted
Diluted EPS and re-accelerating revenue growth,” said Chris
Cartwright, President and CEO. “U.S. Markets grew as lending and
marketing activity remained subdued but consistent with prior
quarter. Our International segment again grew double-digits, led by
India, Canada, Asia Pacific and Africa.”
“In the fourth quarter, we also announced and began the next
step in our transformation program, aimed at optimizing our
operating model and streamlining our technology onto a common
product delivery platform, branded OneTru. We expect this two-year
program to drive material cost savings while accelerating
innovation and increasing organic growth.”
“In 2024, we expect to deliver 3 to 5 percent revenue growth
with expanding Adjusted EBITDA margins, assuming slow economic
growth and no in-year benefits from interest rate cuts. Our
innovative solutions and diversified vertical, product and
geographic portfolio continue to drive performance and we believe
position us to accelerate growth as lending and marketing activity
recovers.”
Fourth Quarter
2023 Segment Results
U.S. Markets:
U.S. Markets revenue was $608 million, an
increase of 3 percent compared with the fourth quarter of 2022.
- Financial Services
revenue was $305 million, an increase of 3 percent compared with
the fourth quarter of 2022.
- Emerging Verticals
revenue was $303 million, an increase of 2 percent compared with
the fourth quarter of 2022.
Adjusted EBITDA was $202 million, consistent
with the fourth quarter of 2022.
International:
International revenue was $215 million, an
increase of 14 percent (13 percent on a constant currency basis)
compared with the fourth quarter of 2022.
- Canada revenue was
$36 million, an increase of 14 percent (14 percent on a constant
currency basis) compared with the fourth quarter of 2022.
- Latin America
revenue was $31 million, an increase of 13 percent (5 percent on a
constant currency basis) compared with the fourth quarter of
2022.
- United Kingdom
revenue was $51 million, an increase of 6 percent (flat on a
constant currency basis) compared with the fourth quarter of
2022.
- Africa revenue was
$16 million, an increase of 3 percent (12 percent on a constant
currency basis) compared with the fourth quarter of 2022.
- India revenue was
$57 million, an increase of 28 percent (30 percent on a constant
currency basis) compared with the fourth quarter of 2022.
- Asia Pacific
revenue was $23 million, an increase of 14 percent (13 percent on a
constant currency basis) compared with the fourth quarter of
2022.
Adjusted EBITDA was $95 million, an increase of
15 percent (13 percent on a constant currency basis) compared with
the fourth quarter of 2022.
Consumer Interactive:
Consumer Interactive revenue was $150 million,
an increase of 7 percent compared with the fourth quarter of
2022.
Adjusted EBITDA was $68 million, a decrease of 6
percent compared with the fourth quarter of 2022.
Full Year 2023 Results
Revenue:
- Total revenue for
the year was $3,831 million, an increase of 3 percent (4 percent on
a constant currency basis, 3 percent on an organic constant
currency basis) compared with 2022.
Earnings:
- Net (loss) income
attributable to TransUnion was $(206) million for the year,
compared with $266 million in 2022. Diluted (loss) earnings per
share was $(1.07), compared with $1.38 in 2022. Net (loss) income
attributable to TransUnion margin was (5) percent, compared with 7
percent in 2022. Our 2023 net (loss) attributable to TransUnion,
diluted (loss) earnings per share and net (loss) attributable to
TransUnion margin include expenses associated with our
transformation plan, as described below, and a goodwill impairment
recognized in the third quarter of 2023.
- Adjusted Net Income
was $655 million for the year, compared with $699 million in
2022. Adjusted Diluted Earnings per Share was $3.37, compared
with $3.62 in 2022.
- Adjusted EBITDA was
$1,344 million for the year, essentially flat (an increase of 1
percent on a constant currency basis, 1 percent on an organic
constant currency basis) compared with 2022. Adjusted EBITDA margin
was 35 percent, compared with 36 percent in 2022.
Transformation Plan
On November 15, 2023, we announced a multi-year
transformation plan to optimize our operating model and continue to
advance our technology. In the fourth quarter of 2023, we incurred
total expenses associated with this transformation plan of
$78 million, comprised of restructuring expenses for employee
separation and non-cash impairment charges associated with leased
facilities, as well as other business optimization expenses. See
our Annual Report on Form 10-K for the year ended December 31,
2023, to be filed with the Securities and Exchange Commission
(“SEC”) later this month for further information regarding this
matter.
Liquidity and Capital
Resources
Cash and cash equivalents were $480 million at
December 31, 2023 and $585 million at December 31, 2022.
For the twelve months ended December 31, 2023, we prepaid
$250 million of our Senior Secured Term Loan B-6, funded from
our cash-on-hand. We also used proceeds from the October 27, 2023
refinancing of our Senior Secured Term Loan A-3 to prepay
$300 million of Senior Secured Term Loan B-6. Additionally, we
refinanced our existing revolving credit facility with a new
tranche of revolving credit commitments in an aggregate principal
amount of $600 million (an increase of $300 million).
On February 8, 2024, the Company refinanced its
Senior Secured Term Loan B-6. The aggregate principal amount of
this debt instrument immediately following the transaction was
approximately $1.9 billion. As a result of the transaction, the
margin was set to 2.00% and is no longer a function of our total
net leverage ratio. Additionally, the credit spread adjustment was
removed. The new pricing on our debt is SOFR plus margin of 2.00%.
The Senior Secured Term Loan B-6 remains subject to quarterly
principal payments with the remaining balance due December 1,
2028.
For the twelve months ended December 31, 2023,
cash provided by operating activities of continuing operations was
$649 million compared with cash provided by operating activities of
continuing operations of $301 million in 2022. The increase in
cash provided by operating activities of continuing operations was
due primarily to prior year taxes paid on the gain from the
divestiture of our Healthcare business and lower bonus and
commission payments in the current year, partially offset by an
increase in interest expense. Cash used in investing activities of
continuing operations was $319 million for 2023 compared with
$719 million in 2022. The decrease in cash used in investing
activities of continuing operations was due primarily to a net
decrease in cash outflows for acquisitions and divestitures,
partially offset by the proceeds from the sale of discontinued
operations. Capital expenditures as a percent of revenue
represented 8% for 2023 and 2022. For 2023, cash used in financing
activities of continuing operations was $439 million compared with
$821 million in 2022. Cash used in financing activities of
continuing operations decreased due primarily to a decrease in debt
payments and cash used to pay employee taxes on restricted stock
units.
Revision of Previously Issued Financial
Statements
During the fourth quarter of 2023, the Company
identified an error in the classification of certain costs between
cost of services and selling, general and administrative in our
Consolidated Statements of Operations, which resulted in an
understatement of cost of services and an overstatement of selling,
general and administrative in equal and offsetting amounts
resulting in no impact to total operating expenses, operating
income or net income. This error was incremental to the
classification error of employee costs related to certain of our
recent acquisitions that was identified in the second quarter of
2023. In addition, we corrected an immaterial error related to an
over accrual of expenses, net of the related income tax effect,
during the twelve months ended December 31, 2021, that had
previously been corrected out of period during the twelve months
ended December 31, 2022. We will provide additional information
regarding this matter in our Annual Report on Form 10-K for the
year ended December 31, 2023.
A summary of the revision to the impacted
financial statement line items in the Company’s previously issued
Consolidated Statements of Operations is shown on Schedule 8,
“Revision of Previously Issued Financial Statements.”
As a result of the classification error
described above, the Company identified a material weakness in its
internal control over financial reporting.
First Quarter and Full
Year 2024 Outlook
Our guidance is based on a number of assumptions
that are subject to change, many of which are outside of the
control of the Company, including general macroeconomic conditions,
interest rates and inflation. There are numerous evolving factors
that we may not be able to accurately predict. There can be no
assurance that the Company will achieve the results expressed by
this guidance.
|
|
Three Months EndedMarch 31, 2024 |
|
Twelve Months EndedDecember 31, 2024 |
(in millions, except per share
data) |
|
Low |
|
High |
|
Low |
|
High |
Revenue, as reported |
|
$ |
971 |
|
|
$ |
980 |
|
|
$ |
3,960 |
|
|
$ |
4,020 |
|
Revenue growth1: |
|
|
|
|
|
|
|
|
As reported |
|
|
3 |
% |
|
|
4 |
% |
|
|
3 |
% |
|
|
5 |
% |
Constant currency1, 2 |
|
|
3 |
% |
|
|
4 |
% |
|
|
3 |
% |
|
|
5 |
% |
Organic constant currency1, 3 |
|
|
3 |
% |
|
|
4 |
% |
|
|
3 |
% |
|
|
5 |
% |
|
|
|
|
|
|
|
|
|
Net income attributable to
TransUnion |
|
$ |
22 |
|
|
$ |
27 |
|
|
$ |
211 |
|
|
$ |
244 |
|
Net income attributable to TransUnion growth |
|
(58 |
)% |
|
(49 |
)% |
|
|
202 |
% |
|
|
218 |
% |
Net income attributable to TransUnion margin |
|
|
2.3 |
% |
|
|
2.7 |
% |
|
|
5.3 |
% |
|
|
6.1 |
% |
|
|
|
|
|
|
|
|
|
Diluted Earnings per
Share |
|
$ |
0.11 |
|
|
$ |
0.14 |
|
|
$ |
1.08 |
|
|
$ |
1.24 |
|
Diluted Earnings per Share growth |
|
(59 |
)% |
|
(49 |
)% |
|
|
202 |
% |
|
|
217 |
% |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA, as
reported5 |
|
$ |
324 |
|
|
$ |
331 |
|
|
$ |
1,398 |
|
|
$ |
1,441 |
|
Adjusted EBITDA growth, as reported4 |
|
|
1 |
% |
|
|
3 |
% |
|
|
4 |
% |
|
|
7 |
% |
Adjusted EBITDA margin |
|
|
33.4 |
% |
|
|
33.8 |
% |
|
|
35.3 |
% |
|
|
35.8 |
% |
|
|
|
|
|
|
|
|
|
Adjusted Diluted Earnings per
Share5 |
|
$ |
0.79 |
|
|
$ |
0.81 |
|
|
$ |
3.57 |
|
|
$ |
3.74 |
|
Adjusted Diluted Earnings per Share growth |
|
(2 |
)% |
|
|
1 |
% |
|
|
6 |
% |
|
|
11 |
% |
|
- Additional revenue
growth assumptions:
- The impact of
changing foreign currency exchange rates is expected to have an
insignificant impact for Q1 2024 and FY 2024.
- There is no impact
from recent acquisitions for Q1 2024 and FY 2024.
- The impact of
mortgage is expected to be approximately 1 point of benefit for Q1
2024 and 1.5 points of benefit for FY 2024. These impacts are
calculated by removing the U.S. mortgage revenue from both the
current year and prior year periods.
- Constant currency
growth rates assume foreign currency exchange rates are consistent
between years. This allows financial results to be evaluated
without the impact of fluctuations in foreign currency exchange
rates.
- Organic constant
currency growth rates are constant currency growth excluding
inorganic growth. Inorganic growth represents growth attributable
to the first twelve months of activity for recent business
acquisitions. There is no impact from recent business acquisitions
in Q1 2024 and FY 2024.
- Additional Adjusted
EBITDA assumptions:
- The impact of
changing foreign currency exchange rates is expected to have an
insignificant impact for Q1 2024 and FY 2024.
- For a
reconciliation of the above non-GAAP financial measures to the most
directly comparable GAAP financial measures, refer to Schedule 7 of
this Earnings Release.
Earnings Webcast Details
In conjunction with this release, TransUnion
will host a conference call and webcast today at 8:30 a.m. Central
Time to discuss the business results for the quarter and certain
forward-looking information. This session and the accompanying
presentation materials may be accessed at www.transunion.com/tru. A
replay of the call will also be available at this website following
the conclusion of the call.
About TransUnion (NYSE:
TRU)
TransUnion is a global information and insights
company with over 13,000 associates operating in more than 30
countries. We make trust possible by ensuring each person is
reliably represented in the marketplace. We do this with a Tru™
picture of each person: an actionable view of consumers, stewarded
with care. Through our acquisitions and technology investments we
have developed innovative solutions that extend beyond our strong
foundation in core credit into areas such as marketing, fraud, risk
and advanced analytics. As a result, consumers and businesses can
transact with confidence and achieve great things. We call this
Information for Good® — and it leads to economic opportunity, great
experiences and personal empowerment for millions of people around
the world.
http://www.transunion.com/business
Availability of Information on
TransUnion’s Website
Investors and others should note that TransUnion
routinely announces material information to investors and the
marketplace using SEC filings, press releases, public conference
calls, webcasts and the TransUnion Investor Relations website.
While not all of the information that the Company posts to the
TransUnion Investor Relations website is of a material nature, some
information could be deemed to be material. Accordingly, the
Company encourages investors, the media and others interested in
TransUnion to review the information that it shares on
www.transunion.com/tru.
Forward-Looking Statements
This earnings release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements are based on the current
beliefs and expectations of TransUnion’s management and are subject
to significant risks and uncertainties. Actual results may differ
materially from those described in the forward-looking statements.
Any statements made in this earnings release that are not
statements of historical fact, including statements about our
beliefs and expectations, are forward-looking statements.
Forward-looking statements include information concerning possible
or assumed future results of operations, including our guidance and
descriptions of our business plans and strategies. These statements
often include words such as “anticipate,” “expect,” “guidance,”
“suggest,” “plan,” “believe,” “intend,” “estimate,” “target,”
“project,” “should,” “could,” “would,” “may,” “will,” “forecast,”
“outlook,” “potential,” “continues,” “seeks,” “predicts,” or the
negatives of these words and other similar expressions.
Factors that could cause actual results to
differ materially from those described in the forward-looking
statements, or that could materially affect our financial results
or such forward-looking statements include:
- macroeconomic
effects and changes in market conditions, including the impact of
inflation, risk of recession, and industry trends and adverse
developments in the debt, consumer credit and financial services
markets, including the impact on the carrying value of our assets
in all of the markets where we operate;
- our ability to
provide competitive services and prices;
- our ability to
retain or renew existing agreements with large or long-term
customers;
- our ability to
maintain the security and integrity of our data;
- our ability to
deliver services timely without interruption;
- our ability to
maintain our access to data sources;
- government
regulation and changes in the regulatory environment;
- litigation or
regulatory proceedings;
- our ability to
effectively manage our costs;
- our efforts to
execute our transformation plan and achieve the anticipated
benefits and savings;
- our ability to
remediate existing material weaknesses in internal control over
financial reporting and maintain effective internal control over
financial reporting or disclosure controls and procedures;
- economic and
political stability in the United States and international markets
where we operate;
- our ability to
effectively develop and maintain strategic alliances and joint
ventures;
- our ability to
timely develop new services and the market’s willingness to adopt
our new services;
- our ability to
manage and expand our operations and keep up with rapidly changing
technologies;
- our ability to
acquire businesses, successfully secure financing for our
acquisitions, timely consummate our acquisitions, successfully
integrate the operations of our acquisitions, control the costs of
integrating our acquisitions and realize the intended benefits of
such acquisitions;
- our ability to
protect and enforce our intellectual property, trade secrets and
other forms of unpatented intellectual property;
- our ability to
defend our intellectual property from infringement claims by third
parties;
- geopolitical
conditions and other risks associated with our international
operations;
- the ability of our
outside service providers and key vendors to fulfill their
obligations to us;
- further
consolidation in our end-customer markets;
- the increased
availability of free or inexpensive consumer information;
- losses against
which we do not insure;
- our ability to make
timely payments of principal and interest on our indebtedness;
- our ability to
satisfy covenants in the agreements governing our
indebtedness;
- our ability to
maintain our liquidity;
- share repurchase
plans; and
- our reliance on key
management personnel.
There may be other factors, many of which are
beyond our control, that may cause our actual results to differ
materially from the forward-looking statements, including factors
disclosed in our Annual Report on Form 10-K for the year ended
December 31, 2023, to be filed with the SEC in February 2024, and
our Annual Report on Form 10-K for the year ended December 31,
2022, as well as our quarterly reports for the quarters ended
September 30, 2023, June 30, 2023 and March 31, 2023, and any
subsequent Quarterly Report on Form 10-Q or Current Report on Form
8-K filed with the Securities and Exchange Commission. You should
evaluate all forward-looking statements made in this report in the
context of these risks and uncertainties.
The forward-looking statements contained in this
earnings release speak only as of the date of this earnings
release. We undertake no obligation to publicly release the result
of any revisions to these forward-looking statements to reflect the
impact of events or circumstances that may arise after the date of
this earnings release.
For
More Information |
E-mail: |
Investor.Relations@transunion.com |
Telephone: |
312.985.2860 |
TRANSUNION AND SUBSIDIARIESConsolidated
Balance Sheets (Unaudited)(in millions, except per share
data) |
|
|
December 31,2023 |
|
December 31,2022 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
479.9 |
|
|
$ |
585.3 |
|
Trade accounts receivable, net of allowance of $16.4 and $11.0 |
|
721.5 |
|
|
|
602.2 |
|
Other current assets |
|
275.9 |
|
|
|
262.7 |
|
Total current assets |
|
1,477.3 |
|
|
|
1,450.2 |
|
Property, plant and equipment,
net of accumulated depreciation and amortization of $804.4 and
$711.3 |
|
199.3 |
|
|
|
218.2 |
|
Goodwill |
|
5,176.0 |
|
|
|
5,551.4 |
|
Other intangibles, net of
accumulated amortization of $2,719.8 and $2,268.6 |
|
3,515.3 |
|
|
|
3,675.5 |
|
Other assets |
|
739.4 |
|
|
|
771.0 |
|
Total
assets |
$ |
11,107.3 |
|
|
$ |
11,666.3 |
|
Liabilities and
stockholders’ equity |
|
|
|
Current liabilities: |
|
|
|
Trade accounts payable |
$ |
253.5 |
|
|
$ |
250.4 |
|
Short-term debt and current portion of long-term debt |
|
89.6 |
|
|
|
114.6 |
|
Other current liabilities |
|
661.8 |
|
|
|
540.5 |
|
Total current liabilities |
|
1,004.9 |
|
|
|
905.5 |
|
Long-term debt |
|
5,250.8 |
|
|
|
5,555.5 |
|
Deferred taxes |
|
592.9 |
|
|
|
762.0 |
|
Other liabilities |
|
153.2 |
|
|
|
173.9 |
|
Total
liabilities |
|
7,001.8 |
|
|
|
7,396.9 |
|
Stockholders’ equity: |
|
|
|
Common stock, $0.01 par value;
1.0 billion shares authorized at December 31, 2023 and December 31,
2022; 200.0 million and 198.7 million shares issued as of
December 31, 2023 and December 31, 2022, respectively; and 193.8
million and 192.7 million shares outstanding as of December
31, 2023 and December 31, 2022, respectively |
|
2.0 |
|
|
|
2.0 |
|
Additional paid-in capital |
|
2,412.9 |
|
|
|
2,290.3 |
|
Treasury stock at cost; 6.2
million and 6.0 million shares at December 31, 2023 and
December 31, 2022, respectively |
|
(302.9 |
) |
|
|
(284.5 |
) |
Retained earnings |
|
2,157.1 |
|
|
|
2,446.6 |
|
Accumulated other comprehensive loss |
|
(260.9 |
) |
|
|
(284.5 |
) |
Total TransUnion stockholders’
equity |
|
4,008.2 |
|
|
|
4,169.9 |
|
Noncontrolling interests |
|
97.3 |
|
|
|
99.5 |
|
Total stockholders’
equity |
|
4,105.5 |
|
|
|
4,269.4 |
|
Total liabilities and
stockholders’ equity |
$ |
11,107.3 |
|
|
$ |
11,666.3 |
|
TRANSUNION AND
SUBSIDIARIESConsolidated Statements of
Operations (Unaudited)(in millions, except per share
data) |
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue |
$ |
954.3 |
|
|
$ |
902.1 |
|
|
$ |
3,831.2 |
|
|
$ |
3,709.9 |
|
Operating
expenses |
|
|
|
|
|
|
|
Cost of services (exclusive of depreciation and amortization
below) |
|
380.6 |
|
|
|
354.6 |
|
|
|
1,517.3 |
|
|
|
1,385.1 |
|
Selling, general and administrative |
|
303.9 |
|
|
|
273.9 |
|
|
|
1,171.6 |
|
|
|
1,179.4 |
|
Depreciation and amortization |
|
133.3 |
|
|
|
130.1 |
|
|
|
524.4 |
|
|
|
519.0 |
|
Goodwill impairment |
|
— |
|
|
|
— |
|
|
|
414.0 |
|
|
|
— |
|
Restructuring |
|
75.3 |
|
|
|
— |
|
|
|
75.3 |
|
|
|
— |
|
Total operating
expenses |
|
893.0 |
|
|
|
758.5 |
|
|
|
3,702.7 |
|
|
|
3,083.5 |
|
Operating
income |
|
61.3 |
|
|
|
143.5 |
|
|
|
128.5 |
|
|
|
626.3 |
|
Non-operating income
and (expense) |
|
|
|
|
|
|
|
Interest expense |
|
(71.0 |
) |
|
|
(67.5 |
) |
|
|
(288.2 |
) |
|
|
(230.9 |
) |
Interest income |
|
5.7 |
|
|
|
1.6 |
|
|
|
20.7 |
|
|
|
4.7 |
|
Earnings from equity method investments |
|
4.6 |
|
|
|
3.3 |
|
|
|
16.3 |
|
|
|
13.0 |
|
Other (expense) income, net |
|
(6.4 |
) |
|
|
(9.8 |
) |
|
|
(22.7 |
) |
|
|
(30.0 |
) |
Total non-operating
(expense) and income |
|
(67.1 |
) |
|
|
(72.4 |
) |
|
|
(273.9 |
) |
|
|
(243.3 |
) |
(Loss) income from
continuing operations before income taxes |
|
(5.8 |
) |
|
|
71.2 |
|
|
|
(145.3 |
) |
|
|
383.0 |
|
Benefit (provision)
for income taxes |
|
15.4 |
|
|
|
(35.8 |
) |
|
|
(44.7 |
) |
|
|
(118.9 |
) |
Income (loss) from
continuing operations |
|
9.5 |
|
|
|
35.3 |
|
|
|
(190.1 |
) |
|
|
264.1 |
|
Discontinued
operations, net of tax |
|
— |
|
|
|
15.0 |
|
|
|
(0.7 |
) |
|
|
17.4 |
|
Net income
(loss) |
|
9.5 |
|
|
|
50.4 |
|
|
|
(190.8 |
) |
|
|
281.5 |
|
Less: net income
attributable to noncontrolling interests |
|
(3.5 |
) |
|
|
(3.9 |
) |
|
|
(15.4 |
) |
|
|
(15.2 |
) |
Net income (loss)
attributable to TransUnion |
$ |
6.1 |
|
|
$ |
46.4 |
|
|
$ |
(206.2 |
) |
|
$ |
266.3 |
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations |
$ |
9.5 |
|
|
$ |
35.3 |
|
|
$ |
(190.1 |
) |
|
$ |
264.1 |
|
Less: income from
continuing operations attributable to noncontrolling
interests |
|
(3.5 |
) |
|
|
(3.9 |
) |
|
|
(15.4 |
) |
|
|
(15.2 |
) |
Income (loss) from
continuing operations attributable to TransUnion |
|
6.0 |
|
|
|
31.4 |
|
|
|
(205.4 |
) |
|
|
248.9 |
|
Discontinued
operations, net of tax |
|
— |
|
|
|
15.0 |
|
|
|
(0.7 |
) |
|
|
17.4 |
|
Net income (loss)
attributable to TransUnion |
$ |
6.1 |
|
|
$ |
46.4 |
|
|
$ |
(206.2 |
) |
|
$ |
266.3 |
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per common share from: |
|
|
|
|
|
|
|
Income (loss) from continuing operations attributable to
TransUnion |
$ |
0.03 |
|
|
$ |
0.16 |
|
|
$ |
(1.06 |
) |
|
$ |
1.29 |
|
Discontinued operations, net of tax |
|
— |
|
|
|
0.08 |
|
|
|
— |
|
|
|
0.09 |
|
Net income (loss) attributable to TransUnion |
$ |
0.03 |
|
|
$ |
0.24 |
|
|
$ |
(1.07 |
) |
|
$ |
1.38 |
|
Diluted earnings
(loss) per common share from: |
|
|
|
|
|
|
|
Income (loss) from continuing operations attributable to
TransUnion |
$ |
0.03 |
|
|
$ |
0.16 |
|
|
$ |
(1.06 |
) |
|
$ |
1.29 |
|
Discontinued operations, net of tax |
|
— |
|
|
|
0.08 |
|
|
|
— |
|
|
|
0.09 |
|
Net income (loss) attributable to TransUnion |
$ |
0.03 |
|
|
$ |
0.24 |
|
|
$ |
(1.07 |
) |
|
$ |
1.38 |
|
Weighted-average
shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
193.7 |
|
|
|
192.7 |
|
|
|
193.4 |
|
|
|
192.5 |
|
Diluted |
|
194.3 |
|
|
|
193.1 |
|
|
|
193.4 |
|
|
|
193.1 |
|
|
As a result of displaying amounts in millions, rounding
differences may exist in the table above.
TRANSUNION AND SUBSIDIARIESConsolidated
Statements of Cash Flows (Unaudited)(in millions) |
|
|
Twelve Months Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
Cash flows from
operating activities: |
|
|
|
Net (loss) income |
$ |
(190.8 |
) |
|
$ |
281.5 |
|
Less: Discontinued operations, net of tax |
|
(0.7 |
) |
|
|
17.4 |
|
(Loss) income from continuing operations |
|
(190.1 |
) |
|
|
264.1 |
|
Adjustments to reconcile net (loss) income to net cash provided by
operating activities: |
|
|
|
Depreciation and amortization |
|
524.4 |
|
|
|
519.0 |
|
Goodwill impairment |
|
414.0 |
|
|
|
— |
|
Loss on repayment of loans |
|
7.6 |
|
|
|
9.4 |
|
Deferred taxes |
|
(162.7 |
) |
|
|
(88.9 |
) |
Stock-based compensation |
|
100.3 |
|
|
|
82.8 |
|
Other |
|
26.0 |
|
|
|
22.6 |
|
Changes in assets and liabilities: |
|
|
|
Trade accounts receivable |
|
(133.6 |
) |
|
|
(37.5 |
) |
Other current and long-term assets |
|
(12.7 |
) |
|
|
(17.7 |
) |
Trade accounts payable |
|
(4.3 |
) |
|
|
(20.7 |
) |
Other current and long-term liabilities |
|
80.4 |
|
|
|
(432.1 |
) |
Cash provided by
operating activities of continuing operations |
|
649.3 |
|
|
|
301.0 |
|
Cash used in operating
activities of discontinued operations |
|
(0.2 |
) |
|
|
(3.8 |
) |
Cash provided by
operating activities |
|
649.1 |
|
|
|
297.2 |
|
Cash flows from
investing activities: |
|
|
|
Capital expenditures |
|
(310.7 |
) |
|
|
(298.2 |
) |
Proceeds from sale/maturity of other investments |
|
82.3 |
|
|
|
143.5 |
|
Purchases of other investments |
|
(53.5 |
) |
|
|
(146.1 |
) |
Investments in consolidated affiliates, net of cash acquired |
|
— |
|
|
|
(508.1 |
) |
Investments in nonconsolidated affiliates and purchase of
convertible notes |
|
(36.9 |
) |
|
|
(16.2 |
) |
Payment related to disposal of discontinued operations |
|
(0.5 |
) |
|
|
103.6 |
|
Other |
|
0.4 |
|
|
|
2.7 |
|
Cash used in investing
activities of continuing operations |
|
(318.9 |
) |
|
|
(718.8 |
) |
Cash used in investing
activities of discontinued operations |
|
— |
|
|
|
(5.1 |
) |
Cash used in investing
activities |
|
(318.9 |
) |
|
|
(723.9 |
) |
Cash flows from
financing activities: |
|
|
|
Proceeds from Term Loans |
|
655.8 |
|
|
|
— |
|
Repayments of Term Loans |
|
(347.7 |
) |
|
|
— |
|
Repayments of debt |
|
(650.0 |
) |
|
|
(714.6 |
) |
Debt financing fees |
|
(3.3 |
) |
|
|
— |
|
Proceeds from issuance of common stock and exercise of stock
options |
|
23.1 |
|
|
|
18.7 |
|
Dividends to shareholders |
|
(81.8 |
) |
|
|
(77.8 |
) |
Employee taxes paid on restricted stock units recorded as treasury
stock |
|
(18.4 |
) |
|
|
(32.5 |
) |
Payment of contingent consideration |
|
— |
|
|
|
(2.8 |
) |
Distributions to noncontrolling interests |
|
(16.5 |
) |
|
|
(11.5 |
) |
Cash used in financing
activities of continuing operations |
|
(438.8 |
) |
|
|
(820.5 |
) |
Effect of exchange rate
changes on cash and cash equivalents |
|
3.2 |
|
|
|
(9.9 |
) |
Net change in cash and cash
equivalents |
|
(105.4 |
) |
|
|
(1,257.1 |
) |
Cash and cash equivalents,
beginning of period |
|
585.3 |
|
|
|
1,842.4 |
|
Cash and cash
equivalents, end of period |
$ |
479.9 |
|
|
$ |
585.3 |
|
|
As a result of displaying amounts in millions, rounding
differences may exist in the table above.
TRANSUNION AND SUBSIDIARIESNon-GAAP
Financial Measures |
|
We present Consolidated Adjusted EBITDA,
Consolidated Adjusted EBITDA Margin, Adjusted Net Income, Adjusted
Diluted Earnings per Share, Adjusted Provision for Income Taxes,
Adjusted Effective Tax Rate and Leverage Ratio for all periods
presented. These are important financial measures for the Company
but are not financial measures as defined by GAAP. These financial
measures should be reviewed in conjunction with the relevant GAAP
financial measures and are not presented as alternative measures of
GAAP. Other companies in our industry may define or calculate these
measures differently than we do, limiting their usefulness as
comparative measures. Because of these limitations, these non-GAAP
financial measures should not be considered in isolation or as
substitutes for performance measures calculated in accordance with
GAAP, including operating income, operating margin, effective tax
rate, net income (loss) attributable to the Company, diluted
earnings per share or cash provided by operating activities.
Reconciliations of these non-GAAP financial measures to their most
directly comparable GAAP financial measures are presented in the
tables below.
We present Consolidated Adjusted EBITDA,
Consolidated Adjusted EBITDA Margin, Adjusted Net Income, Adjusted
Diluted Earnings per Share, Adjusted Provision for Income Taxes and
Adjusted Effective Tax Rate as supplemental measures of our
operating performance because these measures eliminate the impact
of certain items that we do not consider indicative of our cash
operations and ongoing operating performance. These are measures
frequently used by securities analysts, investors and other
interested parties in their evaluation of the operating performance
of companies similar to ours.
Our board of directors and executive management
team use Adjusted EBITDA as an incentive compensation measure for
most eligible employees and Adjusted Diluted Earnings per Share as
an incentive compensation measure for certain of our senior
executives.
Under the credit agreement governing our Senior
Secured Credit Facility, our ability to engage in activities such
as incurring additional indebtedness, making investments and paying
dividends is tied to our Leverage Ratio which is partially based on
Adjusted EBITDA. Investors also use our Leverage Ratio to assess
our ability to service our debt and make other capital allocation
decisions.
Consolidated Adjusted EBITDA
Management has excluded the following items from
net income (loss) attributable to TransUnion in order to calculate
Adjusted EBITDA for the periods presented:
- Discontinued
operations, net of tax, as reported on our consolidated statements
of operations. We exclude discontinued operations, net of tax
because we believe it does not reflect the underlying and ongoing
performance of our business operations.
- Net interest
expense, which is the sum of interest expense and interest income
as reported on our consolidated statements of operations.
- Provision for
income taxes, as reported on our consolidated statements of
operations.
- Depreciation and
amortization, as reported on our consolidated statements of
operations.
- Goodwill
impairment, as reported on our consolidated statements of
operations. We exclude goodwill impairment because the amount of
such expenses in any specific period may not directly correlate to
the underlying performance of our business operations during that
period and such expense can vary significantly between
periods.
- Stock-based
compensation is used as an incentive to engage and retain our
employees. It is predominantly a non-cash expense. We exclude
stock-based compensation because it may not correlate to the
underlying performance of our business operations during the period
since it is measured at the grant date fair value and it is subject
to variability as a result of performance conditions and timing of
grants. These expenses are reported within cost of services and
selling, general and administrative on our consolidated statements
of operations.
- Operating model
optimization program represents employee separation costs, facility
lease exit costs, and other business process optimization expenses
incurred in connection with the transformation plan discussed
further in “Results of Operations - Factors Affecting Our Results
of Operations.” We exclude these expenses as we believe they are
not directly correlated to the underlying performance of our
business. Further, these costs will vary and may not be comparable
during the transformation initiative as we progress toward an
optimized operating model. These costs are reported in primarily in
selling, general and administrative and restructuring expenses on
our consolidated statements of operations.
- Accelerated
technology investment includes Project Rise and the final phase of
our technology investment announced in November 2023. Project Rise
was announced in February 2020 and was originally expected to be
completed in 2022. Following our acquisition of Neustar in December
2021, we recognized the opportunity to take advantage of Neustar’s
capabilities to enhance and complement our cloud-based technology
already under development as part of Project Rise. As a result, we
extended Project Rise’s timeline to 2024 and increased the total
estimated cost to approximately $240 million. In November 2023, we
announced our plans to further leverage Neustar’s technology to
standardize and streamline our product delivery platforms and to
build a single global platform for fulfillment of our product
lines. The additional investment is expected to be approximately
$90 million during 2024 and 2025 and represents the final phase of
the technology investment in our global technology infrastructure
and core customer applications. We expect that the accelerated
technology investment will fundamentally transform our technology
infrastructure by implementing a global cloud-based approach to
streamline product development, increase the efficiency of ongoing
operations and maintenance, and enable a continuous improvement
approach to avoid the need for another major technology overhaul in
the foreseeable future. The unique effort to build a secure,
reliable and performant hybrid cloud infrastructure requires us to
dedicate separate resources in order to develop the new cloud-based
infrastructure in parallel with our current on-premise environment
by maintaining our existing technology team to ensure no
disruptions to our customers. The costs associated with the
accelerated technology investment are incremental and redundant
costs that will not recur after the program has been completed and
are not representative of our underlying operating performance.
Therefore, we believe that excluding these costs from our non-GAAP
measures provides a better reflection of our ongoing cost
structure. These costs are primarily reported in cost of services
and therefore do not include amounts that are capitalized as
internally developed software.
- Mergers and
acquisitions, divestitures and business optimization expenses are
non-recurring expenses associated with specific transactions
(exploratory or executed) and consist of (i) transaction and
integration costs, (ii) post-acquisition adjustments to contingent
consideration or to assets and liabilities that occurred after the
acquisition measurement period, (iii) fair value and impairment
adjustments related to investments and call and put options, (iv)
transition services agreement income, and (v) a loss on disposal of
a business. We exclude these expenses as we believe they are not
directly correlated to the underlying performance of our business
operations and vary depending upon the timing of such transactions.
These expenses are reported in costs of services, selling, general
and administrative and other income and (expenses), net, on our
consolidated statements of operations.
- Net other
adjustments principally relate to: (i) deferred loan fee expense
from debt prepayments and refinancing, (ii) currency remeasurement
on foreign operations, (iii) other debt financing expenses
consisting primarily of revolving credit facility deferred
financing fee amortization and commitment fees and expenses
associated with ratings agencies and interest rate hedging, (iv)
legal and regulatory expenses, net, and (v) other non-operating
(income) expense. We exclude these expenses as we believe they are
not directly correlated to the underlying performance of our
business and create variability between periods based on the nature
and timing of the expense or income. These costs are reported in
selling, general and administrative and in non-operating income and
expense, net as applicable based on their nature on our
consolidated statements of operations.
Consolidated Adjusted EBITDA Margin
Management defines Consolidated Adjusted EBITDA
Margin as Consolidated Adjusted EBITDA divided by total revenue as
reported.
Adjusted Net Income
Management has excluded the following items from
net income (loss) attributable to TransUnion in order to calculate
Adjusted Net Income for the periods presented:
- Discontinued
operations, net of tax (see Consolidated Adjusted EBITDA
above)
- Goodwill impairment
(see Consolidated Adjusted EBITDA above)
- Amortization of
certain intangible assets presents non-cash amortization expenses
related to assets that arose from our 2012 change in control
transaction and business combinations occurring after our 2012
change in control. We exclude these expenses as we believe they are
not directly correlated to the underlying performance of our
business operations and vary dependent upon the timing of the
transactions that give rise to these assets. Amortization of
intangible assets is included in depreciation and amortization on
our consolidated statements of operations.
- Stock-based
compensation (see Consolidated Adjusted EBITDA above)
- Operating model
optimization program (see Consolidated Adjusted EBITDA above)
- Accelerated
technology investment (see Consolidated Adjusted EBITDA above)
- Mergers and
acquisitions, divestiture and business optimization (see
Consolidated Adjusted EBITDA above)
- Net other is
consistent with the definition in Consolidated Adjusted EBITDA
above except that other debt financing expenses and certain other
miscellaneous income and expense that are included in the
adjustment to calculate Adjusted EBITDA are excluded in the
adjustment made to calculate Adjusted Net Income.
- Total adjustments
for income taxes relates to the cumulative adjustments discussed
below for Adjusted Provision for Income Taxes. This adjustment is
made for the reasons indicated in Adjusted Provision for Income
Taxes below. Adjustments related to the provision for income taxes
are included in the line item by this name on our consolidated
statement of operations.
Adjusted Diluted Earnings Per Share
Management defines Adjusted Diluted Earnings per
Share as Adjusted Net Income divided by the weighted-average
diluted shares outstanding.
Adjusted Provision for Income Taxes
Management has excluded the following items from
our provision for income taxes for the periods presented:
- Tax effect of above
adjustments represents the income tax effect of the adjustments
related to Adjusted Net Income described above. The tax rate
applied to each adjustment is based on the nature of each line
item. We include the tax effect of the adjustments made to adjusted
net income to provide a comprehensive view of our adjusted net
income.
- Excess tax expense
(benefit) for stock-based compensation is the permanent difference
between expenses recognized for book purposes and expenses
recognized for tax purposes, in each case related to stock-based
compensation expense. We exclude this amount from the adjusted tax
provision for income taxes in order to be consistent with the
exclusion of stock-based compensation from the calculation of
Adjusted Net Income.
- Other principally
relates to (i) deferred tax adjustments, including rate changes,
(ii) infrequent or unusual valuation allowance adjustments, (iii)
return to provision, tax authority audit adjustments, and reserves
related to prior periods, and (iv) other non-recurring items. We
exclude these items because they create variability that impacts
comparability between periods.
Adjusted Effective Tax Rate
Management defines Adjusted Effective Tax Rate as Adjusted
Provision for Income Taxes divided by Adjusted income from
continuing operations before income taxes. We calculate adjusted
income from continuing operations before income taxes by excluding
the pre-tax adjustments in the calculation of Adjusted Net Income
discussed above and noncontrolling interest related to these
pre-tax adjustments from (loss) income from continuing operations
before income taxes.
Leverage Ratio
Management defines Leverage Ratio as net debt
divided by Consolidated Adjusted EBITDA for the most recent
twelve-month period including twelve months of Adjusted EBITDA from
significant acquisitions. Net debt is defined as total debt less
cash and cash equivalents as reported on the balance sheet as of
the end of the period.
This earnings release presents constant currency
growth rates assuming foreign currency exchange rates are
consistent between years. This allows financial results to be
evaluated without the impact of fluctuations in foreign currency
exchange rates. This earnings release also presents organic
constant currency growth rates, which assumes consistent foreign
currency exchange rates between years and also eliminates the
impact of our recent acquisitions. This allows financial results to
be evaluated without the impact of fluctuations in foreign currency
exchange rates and the impacts of recent acquisitions.
Free cash flow is defined as cash provided by
operating activities less capital expenditures and is a measure we
may refer to.
Refer to Schedules 1 through 7 for a
reconciliation of our non-GAAP financial measures to the most
directly comparable GAAP financial measure.
SCHEDULE 1TRANSUNION AND
SUBSIDIARIESRevenue and Adjusted EBITDA growth
rates as Reported, CC, Inorganic, Organic and Organic
CC(Unaudited) |
|
|
|
For the Three Months Ended December 31, 2023 compared withthe Three
Months Ended December 31, 2022 |
|
|
Reported |
|
CC Growth1 |
|
Inorganic2 |
|
Organic Growth3 |
|
Organic CC Growth4 |
Revenue: |
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
5.8 |
% |
|
5.4 |
% |
|
— |
% |
|
5.8 |
% |
|
5.4 |
% |
U.S. Markets |
|
2.6 |
% |
|
2.6 |
% |
|
— |
% |
|
2.6 |
% |
|
2.6 |
% |
Financial Services |
|
2.9 |
% |
|
2.9 |
% |
|
— |
% |
|
2.9 |
% |
|
2.9 |
% |
Emerging Verticals |
|
2.2 |
% |
|
2.2 |
% |
|
— |
% |
|
2.2 |
% |
|
2.2 |
% |
International |
|
14.2 |
% |
|
12.6 |
% |
|
— |
% |
|
14.2 |
% |
|
12.6 |
% |
Canada |
|
13.6 |
% |
|
13.8 |
% |
|
— |
% |
|
13.6 |
% |
|
13.8 |
% |
Latin America |
|
13.4 |
% |
|
5.3 |
% |
|
— |
% |
|
13.4 |
% |
|
5.3 |
% |
United Kingdom |
|
5.8 |
% |
|
0.1 |
% |
|
— |
% |
|
5.8 |
% |
|
0.1 |
% |
Africa |
|
3.2 |
% |
|
11.5 |
% |
|
— |
% |
|
3.2 |
% |
|
11.5 |
% |
India |
|
28.4 |
% |
|
30.1 |
% |
|
— |
% |
|
28.4 |
% |
|
30.1 |
% |
Asia Pacific |
|
13.7 |
% |
|
12.9 |
% |
|
— |
% |
|
13.7 |
% |
|
12.9 |
% |
Consumer Interactive |
|
6.6 |
% |
|
6.5 |
% |
|
— |
% |
|
6.6 |
% |
|
6.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA: |
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
1.5 |
% |
|
1.2 |
% |
|
— |
% |
|
1.5 |
% |
|
1.2 |
% |
U.S. Markets |
|
0.3 |
% |
|
0.3 |
% |
|
— |
% |
|
0.3 |
% |
|
0.3 |
% |
International |
|
14.7 |
% |
|
13.2 |
% |
|
— |
% |
|
14.7 |
% |
|
13.2 |
% |
Consumer Interactive |
|
(5.5 |
)% |
|
(5.0 |
)% |
|
— |
% |
|
(5.5 |
)% |
|
(5.0 |
)% |
SCHEDULE 1TRANSUNION AND
SUBSIDIARIESRevenue and Adjusted EBITDA growth
rates as Reported, CC, Inorganic, Organic and Organic
CC(Unaudited) |
|
|
|
For the Twelve Months Ended December 31, 2023 compared withthe
Twelve Months Ended December 31, 2022 |
|
|
Reported |
|
CC Growth1 |
|
Inorganic2 |
|
Organic Growth3 |
|
Organic CC Growth4 |
Revenue: |
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
3.3 |
% |
|
3.9 |
% |
|
0.5 |
% |
|
2.7 |
% |
|
3.3 |
% |
U.S. Markets |
|
2.3 |
% |
|
2.3 |
% |
|
0.8 |
% |
|
1.5 |
% |
|
1.5 |
% |
Financial Services |
|
2.0 |
% |
|
2.0 |
% |
|
1.6 |
% |
|
0.4 |
% |
|
0.4 |
% |
Emerging Verticals |
|
2.7 |
% |
|
2.7 |
% |
|
— |
% |
|
2.7 |
% |
|
2.7 |
% |
International |
|
9.2 |
% |
|
12.2 |
% |
|
— |
% |
|
9.2 |
% |
|
12.2 |
% |
Canada |
|
8.8 |
% |
|
12.8 |
% |
|
— |
% |
|
8.8 |
% |
|
12.8 |
% |
Latin America |
|
6.8 |
% |
|
6.1 |
% |
|
— |
% |
|
6.8 |
% |
|
6.1 |
% |
United Kingdom |
|
(2.8 |
)% |
|
(3.3 |
)% |
|
— |
% |
|
(2.8 |
)% |
|
(3.3 |
)% |
Africa |
|
(1.8 |
)% |
|
10.9 |
% |
|
— |
% |
|
(1.8 |
)% |
|
10.9 |
% |
India |
|
25.6 |
% |
|
32.1 |
% |
|
— |
% |
|
25.6 |
% |
|
32.1 |
% |
Asia Pacific |
|
16.7 |
% |
|
17.2 |
% |
|
— |
% |
|
16.7 |
% |
|
17.2 |
% |
Consumer Interactive |
|
(0.9 |
)% |
|
(0.9 |
)% |
|
— |
% |
|
(0.9 |
)% |
|
(0.9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA: |
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
(0.1 |
)% |
|
0.7 |
% |
|
(0.2 |
)% |
|
0.2 |
% |
|
0.9 |
% |
U.S. Markets |
|
(2.6 |
)% |
|
(2.6 |
)% |
|
(0.4 |
)% |
|
(2.2 |
)% |
|
(2.2 |
)% |
International |
|
9.8 |
% |
|
12.7 |
% |
|
— |
% |
|
9.8 |
% |
|
12.7 |
% |
Consumer Interactive |
|
(1.5 |
)% |
|
(1.2 |
)% |
|
— |
% |
|
(1.5 |
)% |
|
(1.2 |
)% |
|
1. Constant Currency (“CC”) growth
rates assume foreign currency exchange rates are consistent between
years. This allows financial results to be evaluated without the
impact of fluctuations in foreign currency exchange rates.
2. Inorganic growth rate represents
growth attributable to the first twelve months of activity for
recent business acquisitions.
3. Organic growth rate is the
reported growth rate less the inorganic growth rate.
4. Organic CC growth rate is the CC
growth rate less inorganic growth rate.
SCHEDULE 2TRANSUNION AND
SUBSIDIARIESConsolidated and Segment Revenue,
Adjusted EBITDA, and Adjusted EBITDA Margins
(Unaudited)(dollars in millions) |
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue: |
|
|
|
|
|
|
|
U.S. Markets gross
revenue |
|
|
|
|
|
|
|
Financial Services |
$ |
305.2 |
|
|
$ |
296.5 |
|
|
$ |
1,280.3 |
|
|
$ |
1,255.1 |
|
Emerging Verticals |
|
303.0 |
|
|
|
296.3 |
|
|
|
1,223.9 |
|
|
|
1,192.1 |
|
U.S. Markets gross
revenue |
$ |
608.2 |
|
|
$ |
592.8 |
|
|
$ |
2,504.2 |
|
|
$ |
2,447.3 |
|
|
|
|
|
|
|
|
|
International gross
revenue |
|
|
|
|
|
|
|
Canada |
$ |
36.3 |
|
|
$ |
32.0 |
|
|
$ |
139.5 |
|
|
$ |
128.2 |
|
Latin America |
|
31.3 |
|
|
|
27.6 |
|
|
|
120.6 |
|
|
|
112.9 |
|
United Kingdom |
|
51.3 |
|
|
|
48.4 |
|
|
|
197.2 |
|
|
|
203.0 |
|
Africa |
|
16.3 |
|
|
|
15.8 |
|
|
|
60.6 |
|
|
|
61.7 |
|
India |
|
57.1 |
|
|
|
44.4 |
|
|
|
218.8 |
|
|
|
174.2 |
|
Asia Pacific |
|
23.0 |
|
|
|
20.2 |
|
|
|
88.6 |
|
|
|
75.9 |
|
International gross
revenue |
$ |
215.2 |
|
|
$ |
188.5 |
|
|
$ |
825.3 |
|
|
$ |
755.9 |
|
|
|
|
|
|
|
|
|
Consumer Interactive gross
revenue |
$ |
150.3 |
|
|
$ |
141.0 |
|
|
$ |
579.7 |
|
|
$ |
585.3 |
|
|
|
|
|
|
|
|
|
Total gross
revenue |
$ |
973.6 |
|
|
$ |
922.3 |
|
|
$ |
3,909.3 |
|
|
$ |
3,788.4 |
|
|
|
|
|
|
|
|
|
Intersegment revenue
eliminations |
|
|
|
|
|
|
|
U.S. Markets |
$ |
(17.7 |
) |
|
$ |
(18.4 |
) |
|
$ |
(71.7 |
) |
|
$ |
(71.5 |
) |
International |
|
(1.4 |
) |
|
|
(1.5 |
) |
|
|
(5.7 |
) |
|
|
(6.0 |
) |
Consumer Interactive |
|
(0.2 |
) |
|
|
(0.3 |
) |
|
|
(0.6 |
) |
|
|
(1.1 |
) |
Total intersegment revenue
eliminations |
$ |
(19.3 |
) |
|
$ |
(20.2 |
) |
|
$ |
(78.1 |
) |
|
$ |
(78.6 |
) |
|
|
|
|
|
|
|
|
Total revenue as
reported |
$ |
954.3 |
|
|
$ |
902.1 |
|
|
$ |
3,831.2 |
|
|
$ |
3,709.9 |
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA: |
|
|
|
|
|
|
|
U.S. Markets |
$ |
201.7 |
|
|
$ |
201.1 |
|
|
$ |
846.8 |
|
|
$ |
869.0 |
|
International |
|
94.6 |
|
|
|
82.5 |
|
|
|
361.5 |
|
|
|
329.3 |
|
Consumer Interactive |
|
68.3 |
|
|
|
72.3 |
|
|
|
278.2 |
|
|
|
282.3 |
|
Corporate |
|
(38.6 |
) |
|
|
(34.6 |
) |
|
|
(142.8 |
) |
|
|
(135.7 |
) |
|
|
|
|
|
|
|
|
Adjusted EBITDA
margin:1 |
|
|
|
|
|
|
|
U.S. Markets |
|
33.2 |
% |
|
|
33.9 |
% |
|
|
33.8 |
% |
|
|
35.5 |
% |
International |
|
44.0 |
% |
|
|
43.8 |
% |
|
|
43.8 |
% |
|
|
43.6 |
% |
Consumer Interactive |
|
45.5 |
% |
|
|
51.3 |
% |
|
|
48.0 |
% |
|
|
48.2 |
% |
|
1. Segment Adjusted EBITDA margins
are calculated using segment gross revenue and segment Adjusted
EBITDA. Consolidated Adjusted EBITDA Margin is calculated using
total revenue as reported and consolidated Adjusted EBITDA.
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Reconciliation of net
income (loss) attributable to TransUnion to consolidated Adjusted
EBITDA: |
|
|
|
|
|
|
|
Net income (loss) attributable
to TransUnion6 |
$ |
6.1 |
|
|
$ |
46.4 |
|
|
$ |
(206.2 |
) |
|
$ |
266.3 |
|
Discontinued operations, net
of tax |
|
— |
|
|
|
(15.0 |
) |
|
|
0.7 |
|
|
|
(17.4 |
) |
Income (loss) from continuing
operations attributable to TransUnion6 |
$ |
6.0 |
|
|
$ |
31.4 |
|
|
$ |
(205.4 |
) |
|
$ |
248.9 |
|
Net interest expense |
|
65.4 |
|
|
|
65.9 |
|
|
|
267.5 |
|
|
|
226.2 |
|
(Benefit) provision for income taxes6 |
|
(15.4 |
) |
|
|
35.8 |
|
|
|
44.7 |
|
|
|
118.9 |
|
Depreciation and amortization |
|
133.3 |
|
|
|
130.1 |
|
|
|
524.4 |
|
|
|
519.0 |
|
EBITDA6 |
$ |
189.4 |
|
|
$ |
263.1 |
|
|
$ |
631.2 |
|
|
$ |
1,113.1 |
|
Adjustments to EBITDA: |
|
|
|
|
|
|
|
Goodwill impairment |
$ |
— |
|
|
$ |
— |
|
|
$ |
414.0 |
|
|
$ |
— |
|
Stock-based compensation |
|
27.3 |
|
|
|
20.3 |
|
|
|
100.6 |
|
|
|
81.1 |
|
Operating model optimization program1 |
|
77.6 |
|
|
|
— |
|
|
|
77.6 |
|
|
|
— |
|
Accelerated technology investment2,6 |
|
17.0 |
|
|
|
19.2 |
|
|
|
70.6 |
|
|
|
54.0 |
|
Mergers and acquisitions, divestitures and business
optimization3 |
|
10.1 |
|
|
|
14.3 |
|
|
|
34.6 |
|
|
|
50.7 |
|
Net other4 |
|
4.6 |
|
|
|
4.4 |
|
|
|
15.2 |
|
|
|
46.1 |
|
Total adjustments to
EBITDA6 |
$ |
136.6 |
|
|
$ |
58.2 |
|
|
$ |
712.5 |
|
|
$ |
231.9 |
|
Consolidated Adjusted
EBITDA6 |
$ |
326.0 |
|
|
$ |
321.3 |
|
|
$ |
1,343.7 |
|
|
$ |
1,344.9 |
|
|
|
|
|
|
|
|
|
Net income (loss) attributable
to TransUnion margin6 |
|
0.6 |
% |
|
|
5.1 |
% |
|
(5.4 |
)% |
|
|
7.2 |
% |
Consolidated Adjusted EBITDA
Margin5,6 |
|
34.2 |
% |
|
|
35.6 |
% |
|
|
35.1 |
% |
|
|
36.3 |
% |
|
As a result of displaying amounts in millions, rounding
differences may exist in the tables above and footnotes below.
1. Consists of restructuring expenses
of $71.9 million related to employee separation costs and $3.4
million related to non-cash facility lease impairments, as well as
$2.3 million related to business process optimization expenses
included primarily in selling, general and administrative.
2. Represents expenses associated
with our accelerated technology investment to migrate to the cloud.
There are three components of the accelerated technology
investment: (i) building foundational capabilities which includes
establishing a modern, API-based and services-oriented software
architecture, (ii) the migration of each application and customer
data to the new enterprise platform including the redundant
software costs during the migration period as well as the efforts
to decommission the legacy system, and (iii) program enablement,
which includes dedicated resources to support the planning and
execution of the program. The amounts for each category of cost are
as follows:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Foundational Capabilities |
|
$ |
8.0 |
|
$ |
11.6 |
|
$ |
35.8 |
|
$ |
34.1 |
Migration Management |
|
|
7.7 |
|
|
6.2 |
|
|
29.6 |
|
|
14.6 |
Program Enablement |
|
|
1.3 |
|
|
1.4 |
|
|
5.2 |
|
|
5.3 |
Total accelerated technology
investment |
|
$ |
17.0 |
|
$ |
19.2 |
|
$ |
70.6 |
|
$ |
54.0 |
|
3. Mergers and acquisitions,
divestitures and business optimization consisted of the following
adjustments:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Transaction and integration
costs |
|
$ |
9.9 |
|
|
$ |
10.1 |
|
|
$ |
30.9 |
|
|
$ |
56.9 |
|
Post-acquisition
adjustments |
|
|
(0.5 |
) |
|
|
— |
|
|
|
4.3 |
|
|
|
(3.4 |
) |
Fair value and impairment
adjustments |
|
|
0.9 |
|
|
|
5.0 |
|
|
|
1.6 |
|
|
|
4.0 |
|
Transition services agreement
income |
|
|
(0.1 |
) |
|
|
(0.8 |
) |
|
|
(2.5 |
) |
|
|
(6.8 |
) |
Loss on business disposal |
|
|
— |
|
|
|
— |
|
|
|
0.3 |
|
|
|
— |
|
Total mergers and
acquisitions, divestitures and business optimization |
|
$ |
10.1 |
|
|
$ |
14.3 |
|
|
$ |
34.6 |
|
|
$ |
50.7 |
|
|
4. Net other consisted of the
following adjustments:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
Deferred loan fee expense from debt prepayments and
refinancing |
|
$ |
6.2 |
|
|
$ |
2.8 |
|
$ |
9.3 |
|
|
$ |
9.3 |
Currency remeasurement on
foreign operations |
|
|
(1.8 |
) |
|
|
1.0 |
|
|
4.8 |
|
|
|
6.3 |
Other debt financing
expenses |
|
|
0.7 |
|
|
|
0.4 |
|
|
2.2 |
|
|
|
1.7 |
Legal and regulatory expenses,
net |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
28.4 |
Other non-operating (income)
and expense |
|
|
(0.5 |
) |
|
|
0.1 |
|
|
(1.0 |
) |
|
|
0.3 |
Total other adjustments |
|
$ |
4.6 |
|
|
$ |
4.4 |
|
$ |
15.2 |
|
|
$ |
46.1 |
|
5. Consolidated Adjusted EBITDA
margin is calculated by dividing Consolidated Adjusted EBITDA by
total revenue.
6. Our results for the twelve months
ended December 31, 2022 have been adjusted to correct an immaterial
error related to an over accrual of expenses, net of the related
income tax effect, during the twelve months ended December 31,
2021, that had previously been corrected out of period during the
twelve months ended December 31, 2022. A portion of this error
impacted our accelerated technology investment adjustment.
SCHEDULE 3TRANSUNION AND
SUBSIDIARIESAdjusted Net Income and Adjusted
Earnings Per Share (Unaudited)(in millions, except per
share data) |
|
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Income (loss) from continuing
operations attributable to TransUnion7 |
|
$ |
6.0 |
|
|
$ |
31.4 |
|
|
$ |
(205.4 |
) |
|
$ |
248.9 |
|
Discontinued operations, net
of tax |
|
|
— |
|
|
|
15.0 |
|
|
|
(0.7 |
) |
|
|
17.4 |
|
Net income (loss) attributable
to TransUnion7 |
|
$ |
6.1 |
|
|
$ |
46.4 |
|
|
$ |
(206.2 |
) |
|
$ |
266.3 |
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
193.7 |
|
|
|
192.7 |
|
|
|
193.4 |
|
|
|
192.5 |
|
Diluted |
|
|
194.3 |
|
|
|
193.1 |
|
|
|
193.4 |
|
|
|
193.1 |
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per
common share from: |
|
|
|
|
|
|
|
|
Income (loss) from continuing operations attributable to
TransUnion7 |
|
$ |
0.03 |
|
|
$ |
0.16 |
|
|
$ |
(1.06 |
) |
|
$ |
1.29 |
|
Discontinued operations, net of tax |
|
|
— |
|
|
|
0.08 |
|
|
|
— |
|
|
|
0.09 |
|
Net income (loss) attributable to TransUnion7 |
|
$ |
0.03 |
|
|
$ |
0.24 |
|
|
$ |
(1.07 |
) |
|
$ |
1.38 |
|
Diluted earnings (loss) per
common share from: |
|
|
|
|
|
|
|
|
Income (loss) from continuing operations attributable to
TransUnion7 |
|
$ |
0.03 |
|
|
$ |
0.16 |
|
|
$ |
(1.06 |
) |
|
$ |
1.29 |
|
Discontinued operations, net of tax |
|
|
— |
|
|
|
0.08 |
|
|
|
— |
|
|
|
0.09 |
|
Net income (loss) attributable to TransUnion7 |
|
$ |
0.03 |
|
|
$ |
0.24 |
|
|
$ |
(1.07 |
) |
|
$ |
1.38 |
|
|
|
|
|
|
|
|
|
|
Reconciliation of net
income (loss) attributable to TransUnion to Adjusted Net
Income: |
|
|
|
|
|
|
|
|
Net income (loss) attributable to TransUnion7 |
|
$ |
6.1 |
|
|
$ |
46.4 |
|
|
$ |
(206.2 |
) |
|
$ |
266.3 |
|
Discontinued operations, net of tax |
|
|
— |
|
|
|
(15.0 |
) |
|
|
0.7 |
|
|
|
(17.4 |
) |
Income (loss) from continuing operations attributable to
TransUnion7 |
|
$ |
6.0 |
|
|
$ |
31.4 |
|
|
$ |
(205.4 |
) |
|
$ |
248.9 |
|
Adjustments before income tax
items: |
|
|
|
|
|
|
|
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
414.0 |
|
|
|
— |
|
Amortization of certain intangible assets |
|
|
72.4 |
|
|
|
75.6 |
|
|
|
293.6 |
|
|
|
306.7 |
|
Stock-based compensation |
|
|
27.3 |
|
|
|
20.3 |
|
|
|
100.6 |
|
|
|
81.1 |
|
Operating model optimization program1 |
|
|
77.6 |
|
|
|
— |
|
|
|
77.6 |
|
|
|
— |
|
Accelerated technology investment2, 7 |
|
|
17.0 |
|
|
|
19.2 |
|
|
|
70.6 |
|
|
|
54.0 |
|
Mergers and acquisitions, divestitures and business
optimization3 |
|
|
10.1 |
|
|
|
14.3 |
|
|
|
34.6 |
|
|
|
50.7 |
|
Net other4 |
|
|
4.4 |
|
|
|
3.8 |
|
|
|
14.0 |
|
|
|
44.3 |
|
Total adjustments before
income tax items7 |
|
$ |
208.8 |
|
|
$ |
133.2 |
|
|
$ |
1,005.0 |
|
|
$ |
536.8 |
|
Total adjustments for income taxes5,7 |
|
$ |
(58.9 |
) |
|
$ |
(13.1 |
) |
|
$ |
(144.1 |
) |
|
$ |
(86.8 |
) |
Adjusted Net
Income7 |
|
$ |
156.0 |
|
|
$ |
151.6 |
|
|
$ |
655.4 |
|
|
$ |
698.9 |
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
193.7 |
|
|
|
192.7 |
|
|
|
193.4 |
|
|
|
192.5 |
|
Diluted |
|
|
194.3 |
|
|
|
193.1 |
|
|
|
194.7 |
|
|
|
193.1 |
|
|
|
|
|
|
|
|
|
|
Adjusted Earnings per
Share:7 |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.81 |
|
|
$ |
0.79 |
|
|
$ |
3.39 |
|
|
$ |
3.63 |
|
Diluted |
|
$ |
0.80 |
|
|
$ |
0.78 |
|
|
$ |
3.37 |
|
|
$ |
3.62 |
|
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Reconciliation of
diluted earnings (loss) per share from net income attributable to
TransUnion to Adjusted Diluted Earnings per Share: |
|
|
|
|
|
|
|
|
Diluted earnings (loss) per
common share from:6 |
|
|
|
|
|
|
|
|
Net income (loss) attributable to TransUnion7 |
|
$ |
0.03 |
|
|
$ |
0.24 |
|
|
$ |
(1.07 |
) |
|
$ |
1.38 |
|
Discontinued operations, net of tax |
|
|
— |
|
|
|
(0.08 |
) |
|
|
— |
|
|
|
(0.09 |
) |
Income (loss) from continuing operations attributable to
TransUnion7 |
|
$ |
0.03 |
|
|
$ |
0.16 |
|
|
$ |
(1.06 |
) |
|
$ |
1.29 |
|
Adjustments before income tax
items: |
|
|
|
|
|
|
|
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
2.13 |
|
|
|
— |
|
Amortization of certain intangible assets |
|
|
0.37 |
|
|
|
0.39 |
|
|
|
1.51 |
|
|
|
1.59 |
|
Stock-based compensation |
|
|
0.14 |
|
|
|
0.11 |
|
|
|
0.52 |
|
|
|
0.42 |
|
Operating model optimization program1 |
|
|
0.40 |
|
|
|
— |
|
|
|
0.40 |
|
|
|
— |
|
Accelerated technology investment2,7 |
|
|
0.09 |
|
|
|
0.10 |
|
|
|
0.36 |
|
|
|
0.28 |
|
Mergers and acquisitions, divestitures and business
optimization3 |
|
|
0.05 |
|
|
|
0.07 |
|
|
|
0.18 |
|
|
|
0.26 |
|
Net other4 |
|
|
0.02 |
|
|
|
0.02 |
|
|
|
0.07 |
|
|
|
0.23 |
|
Total adjustments before
income tax items7 |
|
$ |
1.07 |
|
|
$ |
0.69 |
|
|
$ |
5.16 |
|
|
$ |
2.78 |
|
Total adjustments for income taxes5,7 |
|
|
(0.30 |
) |
|
|
(0.07 |
) |
|
|
(0.74 |
) |
|
|
(0.45 |
) |
Impact of additional dilutive
shares6 |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
0.02 |
|
|
$ |
— |
|
Adjusted Diluted Earnings per
Share7 |
|
$ |
0.80 |
|
|
$ |
0.78 |
|
|
$ |
3.37 |
|
|
$ |
3.62 |
|
|
Each component of earnings per share is
calculated independently, therefore, rounding differences exist in
the table above.
-
Consists of restructuring expenses of $71.9 million related to
employee separation costs and $3.4 million related to non-cash
facility lease impairments, as well as $2.3 million related to
business process optimization expenses included primarily in
selling, general and administrative.
-
Represents expenses associated with our accelerated technology
investment to migrate to the cloud. There are three components of
the accelerated technology investment: (i) building foundational
capabilities which includes establishing a modern, API-based and
services-oriented software architecture, (ii) the migration of each
application and customer data to the new enterprise platform
including the redundant software costs during the migration period
as well as the efforts to decommission the legacy system, and (iii)
program enablement, which includes dedicated resources to support
the planning and execution of the program. The amounts for each
category of cost are as follows:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
Foundational Capabilities |
|
$ |
8.0 |
|
$ |
11.6 |
|
$ |
35.8 |
|
$ |
34.1 |
Migration Management |
|
|
7.7 |
|
|
6.2 |
|
|
29.6 |
|
|
14.6 |
Program Enablement |
|
|
1.3 |
|
|
1.4 |
|
|
5.2 |
|
|
5.3 |
Total accelerated technology investment |
|
$ |
17.0 |
|
$ |
19.2 |
|
$ |
70.6 |
|
$ |
54.0 |
|
3. Mergers and acquisitions,
divestitures and business optimization consisted of the following
adjustments:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Transaction and integration
costs |
|
$ |
9.9 |
|
|
$ |
10.1 |
|
|
$ |
30.9 |
|
|
$ |
56.9 |
|
Post-acquisition
adjustments |
|
|
(0.5 |
) |
|
|
— |
|
|
|
4.3 |
|
|
|
(3.4 |
) |
Fair value and impairment
adjustments |
|
|
0.9 |
|
|
|
5.0 |
|
|
|
1.6 |
|
|
|
4.0 |
|
Transition services agreement
income |
|
|
(0.1 |
) |
|
|
(0.8 |
) |
|
|
(2.5 |
) |
|
|
(6.8 |
) |
Loss on business disposal |
|
|
— |
|
|
|
— |
|
|
|
0.3 |
|
|
|
— |
|
Total mergers and
acquisitions, divestitures and business optimization |
|
$ |
10.1 |
|
|
$ |
14.3 |
|
|
$ |
34.6 |
|
|
$ |
50.7 |
|
|
4. Net other consisted of the
following adjustments:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
2022 |
Deferred loan fee expense from
debt prepayments and refinancing |
|
$ |
6.2 |
|
|
$ |
2.8 |
|
$ |
9.3 |
|
$ |
9.3 |
Currency remeasurement on
foreign operations |
|
|
(1.8 |
) |
|
|
1.0 |
|
|
4.8 |
|
|
6.3 |
Legal and regulatory expenses,
net |
|
|
— |
|
|
|
— |
|
|
— |
|
|
28.4 |
Other non-operating
expense |
|
|
— |
|
|
|
— |
|
|
— |
|
|
0.3 |
Total other adjustments |
|
$ |
4.4 |
|
|
$ |
3.8 |
|
$ |
14.0 |
|
$ |
44.3 |
|
5. Total adjustments
for income taxes represents the total of adjustments discussed to
calculate the Adjusted Provision for Income Taxes.
6. Diluted share
counts for Adjusted Diluted Earnings Per Share includes an
additional 1.3 million of dilutive securities for the twelve months
ended December 31, 2023, which are not included in GAAP diluted
weighted-average shares outstanding due to the Company’s net loss
position for the twelve months ended December 31, 2023.
7. Our results for
the twelve months ended December 31, 2022 have been adjusted to
correct an immaterial error related to an over accrual of expenses,
net of the related income tax effect, during the twelve months
ended December 31, 2021, that had previously been corrected out of
period the twelve months ended December 31, 2022. A portion of this
error impacted our accelerated technology investment
adjustment.
SCHEDULE 4TRANSUNION AND
SUBSIDIARIESAdjusted Provision for Income Taxes,
Effective Tax Rate and Adjusted Effective Tax Rate
(Unaudited)(dollars in millions) |
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
(Loss) income from continuing
operations before income taxes2 |
$ |
(5.8 |
) |
|
$ |
71.2 |
|
|
$ |
(145.3 |
) |
|
$ |
383.0 |
|
Total adjustments before income tax items from Schedule 32 |
|
208.8 |
|
|
|
133.2 |
|
|
|
1,005.0 |
|
|
|
536.8 |
|
Adjusted income from
continuing operations before income taxes2 |
$ |
203.0 |
|
|
$ |
204.4 |
|
|
$ |
859.7 |
|
|
$ |
919.8 |
|
|
|
|
|
|
|
|
|
Reconciliation of
provision for income taxes to Adjusted Provision for Income
Taxes |
|
|
|
|
|
|
|
Benefit (provision) for income
taxes2 |
|
15.4 |
|
|
|
(35.8 |
) |
|
|
(44.7 |
) |
|
|
(118.9 |
) |
Adjustments for income
taxes: |
|
|
|
|
|
|
|
Tax effect of above adjustments2 |
|
(45.5 |
) |
|
|
(34.1 |
) |
|
|
(135.6 |
) |
|
|
(117.4 |
) |
Eliminate impact of excess tax expenses/(benefits) for stock-based
compensation |
|
0.2 |
|
|
|
0.6 |
|
|
|
3.0 |
|
|
|
(5.0 |
) |
Other1 |
|
(13.7 |
) |
|
|
20.4 |
|
|
|
(11.5 |
) |
|
|
35.6 |
|
Total adjustments for income
taxes2 |
$ |
(58.9 |
) |
|
$ |
(13.1 |
) |
|
$ |
(144.1 |
) |
|
$ |
(86.8 |
) |
Adjusted Provision for
Income Taxes2 |
$ |
(43.5 |
) |
|
$ |
(48.9 |
) |
|
$ |
(188.8 |
) |
|
$ |
(205.7 |
) |
|
|
|
|
|
|
|
|
Effective tax rate2 |
|
263.1 |
% |
|
|
50.3 |
% |
|
(30.8 |
)% |
|
|
31.0 |
% |
Adjusted Effective Tax
Rate2 |
|
21.4 |
% |
|
|
23.9 |
% |
|
|
22.0 |
% |
|
|
22.4 |
% |
|
As a result of displaying amounts in millions, rounding
differences may exist in the table above.
1. Other adjustments for income taxes
include:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Deferred tax adjustments |
|
$ |
(13.5 |
) |
|
$ |
4.7 |
|
|
$ |
(12.9 |
) |
|
$ |
6.7 |
|
Valuation allowance
adjustments |
|
|
4.8 |
|
|
|
18.4 |
|
|
|
4.0 |
|
|
|
25.7 |
|
Return to provision, audit
adjustments, and reserves related to prior periods |
|
|
(3.6 |
) |
|
|
(3.2 |
) |
|
|
(1.0 |
) |
|
|
(0.3 |
) |
Other adjustments |
|
|
(1.4 |
) |
|
|
0.5 |
|
|
|
(1.6 |
) |
|
|
3.5 |
|
Total other adjustments |
|
$ |
(13.7 |
) |
|
$ |
20.4 |
|
|
$ |
(11.5 |
) |
|
$ |
35.6 |
|
|
2. Our results for
the twelve months ended December 31, 2022 have been adjusted to
correct an immaterial error related to the income tax effect an
over accrual of expenses during the twelve months ended December
31, 2021, that had previously been corrected out of period during
the twelve months ended December 31, 2022. A portion of this error
impacted our accelerated technology investment adjustment and the
income tax effect of this adjustment.
SCHEDULE 5TRANSUNION AND
SUBSIDIARIESLeverage Ratio
(Unaudited)(dollars in millions) |
|
|
|
Twelve Months Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
Reconciliation of net
(loss) income attributable to TransUnion to Consolidated Adjusted
EBITDA: |
|
|
|
|
Net (loss) income attributable
to TransUnion7 |
|
$ |
(206.2 |
) |
|
$ |
266.3 |
|
Discontinued operations, net
of tax |
|
|
0.7 |
|
|
|
(17.4 |
) |
(Loss) income from continuing
operations attributable to TransUnion7 |
|
$ |
(205.4 |
) |
|
$ |
248.9 |
|
Net interest expense |
|
|
267.5 |
|
|
|
226.2 |
|
Provision for income
taxes7 |
|
|
44.7 |
|
|
|
118.9 |
|
Depreciation and
amortization |
|
|
524.4 |
|
|
|
519.0 |
|
EBITDA7 |
|
$ |
631.2 |
|
|
$ |
1,113.1 |
|
Adjustments to
EBITDA: |
|
|
|
|
Goodwill impairment |
|
$ |
414.0 |
|
|
$ |
— |
|
Stock-based compensation |
|
|
100.6 |
|
|
|
81.1 |
|
Operating model optimization program1 |
|
|
77.6 |
|
|
|
— |
|
Accelerated technology investment2,7 |
|
|
70.6 |
|
|
|
54.0 |
|
Mergers and acquisitions, divestitures and business
optimization3 |
|
|
34.6 |
|
|
|
50.7 |
|
Net other4 |
|
|
15.2 |
|
|
|
46.1 |
|
Total adjustments to
EBITDA7 |
|
$ |
712.5 |
|
|
$ |
231.9 |
|
Consolidated Adjusted
EBITDA7 |
|
|
1,343.7 |
|
|
|
1,344.9 |
|
Adjusted EBITDA for
Pre-Acquisition Period5 |
|
|
— |
|
|
|
6.4 |
|
Leverage Ratio
Adjusted EBITDA7 |
|
$ |
1,343.7 |
|
|
$ |
1,351.3 |
|
|
|
|
|
|
Total debt |
|
$ |
5,340.4 |
|
|
$ |
5,670.1 |
|
Less: Cash and cash
equivalents |
|
|
479.9 |
|
|
|
585.3 |
|
Net Debt |
|
$ |
4,860.5 |
|
|
$ |
5,084.8 |
|
|
|
|
|
|
Ratio of Net Debt to Net
(loss) income attributable to TransUnion7 |
|
|
(23.6 |
) |
|
|
19.1 |
|
Leverage Ratio6,7 |
|
|
3.6 |
|
|
|
3.8 |
|
|
As a result of displaying amounts in millions, rounding
differences may exist in the table above.
1. Consists of restructuring expenses
of $71.9 million related to employee separation costs and $3.4
million related to non-cash facility lease impairments, as well as
$2.3 million related to business process optimization expenses
included primarily in selling, general and administrative.
2. Represents expenses associated
with our accelerated technology investment to migrate to the cloud.
There are three components of the accelerated technology
investment: (i) building foundational capabilities which includes
establishing a modern, API-based and services-oriented software
architecture, (ii) the migration of each application and customer
data to the new enterprise platform including the redundant
software costs during the migration period as well as the efforts
to decommission the legacy system, and (iii) program enablement,
which includes dedicated resources to support the planning and
execution of the program. The amounts for each category of cost are
as follows:
|
|
Twelve Months Ended December 31, |
|
|
2023 |
|
2022 |
Foundational Capabilities |
|
$ |
35.8 |
|
$ |
34.1 |
Migration Management |
|
|
29.6 |
|
|
14.6 |
Program Enablement |
|
|
5.2 |
|
|
5.3 |
Total accelerated technology investment |
|
$ |
70.6 |
|
$ |
54.0 |
|
3. Mergers and acquisitions,
divestitures and business optimization consisted of the following
adjustments:
|
Twelve Months Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
Transaction and integration
costs |
$ |
30.9 |
|
|
$ |
56.9 |
|
Post-acquisition
adjustments |
|
4.3 |
|
|
|
(3.4 |
) |
Fair value and impairment
adjustments |
|
1.6 |
|
|
|
4.0 |
|
Transition services agreement
income |
|
(2.5 |
) |
|
|
(6.8 |
) |
Loss on business disposal |
|
0.3 |
|
|
|
— |
|
Total mergers and
acquisitions, divestitures and business optimization |
$ |
34.6 |
|
|
$ |
50.7 |
|
|
4. Net other consisted of the
following adjustments:
|
Twelve Months Ended December 31, |
|
2023 |
|
|
2022 |
Deferred loan fee expense from debt prepayments and
refinancing |
$ |
9.3 |
|
|
$ |
9.3 |
Currency remeasurement on
foreign operations |
|
4.8 |
|
|
|
6.3 |
Other debt financing
expenses |
|
2.2 |
|
|
|
1.7 |
Legal and regulatory expenses,
net |
|
— |
|
|
|
28.4 |
Other non-operating (income)
and expense |
|
(1.0 |
) |
|
|
0.3 |
Total other adjustments |
$ |
15.2 |
|
|
$ |
46.1 |
|
5. For years in which we made
significant acquisitions, we have included a twelve-month period of
adjusted EBITDA including Adjusted EBITDA for the period prior to
our acquisition. The twelve months ended December 31, 2021 includes
the eleven months of Adjusted EBITDA related to Neustar and Sontiq
prior to our acquisitions in December 2021. The twelve months ended
December 31, 2022 includes the three months of Adjusted EBITDA
related to Argus prior to our acquisition in April 2022.
6. We define Leverage Ratio as net
debt divided by Leverage Ratio Adjusted EBITDA as shown in the
table above.
7. Our results for
the twelve months ended December 31, 2022 have been adjusted to
correct an immaterial error related to an over accrual of expenses,
net of the related income tax effect, during the twelve months
ended December 31, 2021, that had previously been corrected out of
period during the twelve months ended December 31, 2022. A portion
of this error impacted our accelerated technology investment
adjustment.
SCHEDULE 6TRANSUNION AND
SUBSIDIARIESSegment Depreciation and Amortization
(Unaudited)(in millions) |
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
|
|
|
|
|
|
U.S. Markets |
$ |
92.3 |
|
$ |
89.2 |
|
$ |
359.0 |
|
$ |
352.5 |
International |
|
30.9 |
|
|
31.2 |
|
|
126.4 |
|
|
126.9 |
Consumer Interactive |
|
9.0 |
|
|
8.5 |
|
|
34.6 |
|
|
34.8 |
Corporate |
|
1.1 |
|
|
1.1 |
|
|
4.4 |
|
|
4.9 |
Total depreciation and
amortization |
$ |
133.3 |
|
$ |
130.1 |
|
$ |
524.4 |
|
$ |
519.0 |
|
As a result of displaying amounts in millions, rounding
differences may exist in the table above.
SCHEDULE 7TRANSUNION AND
SUBSIDIARIESReconciliation of Non-GAAP Guidance
(Unaudited)(in millions, except per share data) |
|
|
Three Months Ended March 31, 2024 |
|
Twelve Months Ended December 31, 2024 |
|
Low |
|
High |
|
Low |
|
High |
Guidance
reconciliation of net income attributable to TransUnion to Adjusted
EBITDA: |
|
|
|
|
|
|
|
Net income attributable to TransUnion |
$ |
22 |
|
|
$ |
27 |
|
|
$ |
211 |
|
|
$ |
244 |
|
Interest, taxes and
depreciation and amortization |
|
204 |
|
|
|
206 |
|
|
|
848 |
|
|
|
859 |
|
EBITDA |
$ |
226 |
|
|
$ |
233 |
|
|
$ |
1,059 |
|
|
$ |
1,102 |
|
Stock-based compensation,
mergers, acquisitions, divestitures and business optimization,
operating model optimization program, accelerated technology
investment, and net other adjustments1 |
|
98 |
|
|
|
98 |
|
|
|
339 |
|
|
|
339 |
|
Adjusted EBITDA |
$ |
324 |
|
|
$ |
331 |
|
|
$ |
1,398 |
|
|
$ |
1,441 |
|
|
|
|
|
|
|
|
|
Net income attributable to
TransUnion margin |
|
2.3 |
% |
|
|
2.7 |
% |
|
|
5.3 |
% |
|
|
6.1 |
% |
Consolidated Adjusted EBITDA
margin2 |
|
33.4 |
% |
|
|
33.8 |
% |
|
|
35.3 |
% |
|
|
35.8 |
% |
|
|
|
|
|
|
|
|
Guidance
reconciliation of diluted earnings per share to Adjusted Diluted
Earnings per Share: |
|
|
|
|
|
|
|
Diluted earnings per
share |
$ |
0.11 |
|
|
$ |
0.14 |
|
|
$ |
1.08 |
|
|
$ |
1.24 |
|
Adjustments to diluted
earnings per share1 |
|
0.68 |
|
|
|
0.68 |
|
|
|
2.49 |
|
|
|
2.49 |
|
Adjusted Diluted Earnings per
Share |
$ |
0.79 |
|
|
$ |
0.81 |
|
|
$ |
3.57 |
|
|
$ |
3.74 |
|
|
As a result of displaying amounts in millions, rounding
differences may exist in the table above.
1. These adjustments include the same
adjustments we make to our Adjusted EBITDA and Adjusted Net Income
as discussed in the Non-GAAP Financial Measures section of our
Earnings Release.
2. Consolidated Adjusted EBITDA
margin is calculated by dividing Consolidated Adjusted EBITDA by
total revenue.
SCHEDULE 8TRANSUNION AND
SUBSIDIARIESRevision of Previously Issued
Financial Statements (Unaudited)(in millions, except per
share data) |
|
During the fourth quarter of 2023, the Company
identified an error in the classification of certain costs between
cost of services and selling, general and administrative in our
Consolidated Statements of Operations, which resulted in an
understatement of cost of services and an overstatement of selling,
general and administrative in equal and offsetting amounts
resulting in no impact to total operating expenses, operating
income or net income. This error was incremental to the
classification error of employee costs related to certain of our
recent acquisitions that was identified in the second quarter of
2023. In addition, we corrected an immaterial error related to an
over accrual of expenses, net of the related income tax effect,
during the twelve months ended December 31, 2021, that had
previously been corrected out of period during the twelve months
December 31, 2022. We will provide additional information regarding
this matter in our Annual Report on Form 10-K for the year ended
December 31, 2023, to be filed with the SEC later this month.
A summary of the revision to the impacted
financial statement line items in the Company’s previously issued
Consolidated Statements of Operations included in our (i) Annual
Report on Form 10-K for the year ended December 31, 2022, (ii)
Quarterly Reports on Form 10-Q for the three months ended March 31,
2023 and the three and six months ended June 30, 2023, and (iii)
Amendment No. 1 to our Quarterly Report on Form 10-Q/A for the
three and nine months ended September 30, 2023, is as follows:
|
|
Three Months Ended |
|
|
March 31, 20231 |
|
June 30, 20232 |
|
September 30, 20232 |
Cost of
services (exclusive of depreciation and
amortization): |
As Reported |
|
$ |
324.9 |
|
|
$ |
365.5 |
|
|
$ |
344.8 |
|
Adjustment |
|
|
55.9 |
|
|
|
21.5 |
|
|
|
24.0 |
|
As Revised |
|
$ |
380.8 |
|
|
$ |
387.0 |
|
|
$ |
368.8 |
|
|
|
|
|
|
|
|
Selling,
general and administrative: |
As Reported |
|
$ |
340.5 |
|
|
$ |
314.0 |
|
|
$ |
314.8 |
|
Adjustment |
|
|
(55.9 |
) |
|
|
(21.5 |
) |
|
|
(24.0 |
) |
As Revised |
|
$ |
284.6 |
|
|
$ |
292.5 |
|
|
$ |
290.8 |
|
|
1. The As Reported amounts represent
the originally reported cost of services and selling, general and
administrative amounts reported in our Quarterly Report on Form
10-Q for the three months ended March 31, 2023. The Adjustment
amounts above includes the correction of employee costs related to
certain of our recent acquisitions in the second quarter of 2023
and certain expenses in the fourth quarter of 2023.
2. The As Reported amounts represent
the originally reported cost of services and selling, general and
administrative amounts reported in our Quarterly Reports on Form
10-Q for the three and six months ended June 30, 2023 and the three
and nine months ended September 30, 2023. The Adjustment includes
only the classification error for certain expenses identified in
the fourth quarter of 2023.
|
Three Months Ended December 31, 2022 |
|
Twelve Months Ended December 31, 2022 |
|
As Reported1 |
|
Adjustment2 |
|
As Revised |
|
As Reported1 |
|
Adjustment2 |
|
As Revised |
Cost of services (exclusive of depreciation and amortization) |
$ |
311.2 |
|
|
$ |
43.4 |
|
|
$ |
354.6 |
|
|
$ |
1,222.9 |
|
|
$ |
162.2 |
|
|
$ |
1,385.1 |
|
Selling, general and
administrative |
|
317.3 |
|
|
|
(43.4 |
) |
|
|
273.9 |
|
|
|
1,337.4 |
|
|
|
(158.0 |
) |
|
|
1,179.4 |
|
Total operating expenses |
|
758.5 |
|
|
|
— |
|
|
|
758.5 |
|
|
|
3,079.3 |
|
|
|
4.2 |
|
|
|
3,083.5 |
|
Operating income |
|
143.5 |
|
|
|
— |
|
|
|
143.5 |
|
|
|
630.5 |
|
|
|
(4.2 |
) |
|
|
626.3 |
|
Income from continuing
operations before income taxes |
|
71.2 |
|
|
|
— |
|
|
|
71.2 |
|
|
|
387.2 |
|
|
|
(4.2 |
) |
|
|
383.0 |
|
Provision for income
taxes |
|
(35.8 |
) |
|
|
— |
|
|
|
(35.8 |
) |
|
|
(119.9 |
) |
|
|
1.0 |
|
|
|
(118.9 |
) |
Income from continuing
operations |
|
35.3 |
|
|
|
— |
|
|
|
35.3 |
|
|
|
267.3 |
|
|
|
(3.2 |
) |
|
|
264.1 |
|
Net income |
|
50.4 |
|
|
|
— |
|
|
|
50.4 |
|
|
|
284.7 |
|
|
|
(3.2 |
) |
|
|
281.5 |
|
Net income attributable to
TransUnion |
|
46.4 |
|
|
|
— |
|
|
|
46.4 |
|
|
|
269.5 |
|
|
|
(3.2 |
) |
|
|
266.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing
operations attributable to TransUnion |
|
31.4 |
|
|
|
— |
|
|
|
31.4 |
|
|
|
252.1 |
|
|
|
(3.2 |
) |
|
|
248.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common
share from: |
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations attributable to TransUnion |
|
0.16 |
|
|
|
— |
|
|
|
0.16 |
|
|
|
1.31 |
|
|
|
(0.02 |
) |
|
|
1.29 |
|
Net income attributable to TransUnion |
|
0.24 |
|
|
|
— |
|
|
|
0.24 |
|
|
|
1.40 |
|
|
|
(0.02 |
) |
|
|
1.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per common
share from: |
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations attributable to TransUnion |
|
0.16 |
|
|
|
— |
|
|
|
0.16 |
|
|
|
1.31 |
|
|
|
(0.02 |
) |
|
|
1.29 |
|
Net income attributable to TransUnion |
|
0.24 |
|
|
|
— |
|
|
|
0.24 |
|
|
|
1.40 |
|
|
|
(0.02 |
) |
|
|
1.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Measures |
|
|
|
|
|
|
|
|
|
|
|
Consolidated Adjusted EBITDA |
$ |
321.3 |
|
|
$ |
— |
|
|
$ |
321.3 |
|
|
$ |
1,346.5 |
|
|
$ |
(1.6 |
) |
|
$ |
1,344.9 |
|
Adjusted Net Income |
|
151.6 |
|
|
|
— |
|
|
|
151.6 |
|
|
|
700.1 |
|
|
|
(1.2 |
) |
|
|
698.9 |
|
Adjusted Diluted Earnings Per Share |
|
0.78 |
|
|
|
— |
|
|
|
0.78 |
|
|
|
3.62 |
|
|
|
— |
|
|
|
3.62 |
|
|
1. The As Reported amounts in this
table were previously reported in a press release issued by the
Company and filed as Exhibit 99.1 to our Current Report on Form 8-K
filed with the SEC on February 14, 2023, and in our Consolidated
Statements of Operations included in our Annual Report on Form 10-K
for the twelve months ended December 31, 2022.
2. The Adjustment amounts above
include the correction of employee costs related to certain of our
recent acquisitions in the second quarter of 2023 and certain
expenses in the fourth quarter of 2023. In addition, we corrected
an immaterial error related to an over accrual of expenses, net of
the related income tax effect, during the twelve months ended
December 31, 2021, that had previously been corrected out of period
during the twelve months ended December 31, 2022.
TransUnion (NYSE:TRU)
Historical Stock Chart
From Apr 2024 to May 2024
TransUnion (NYSE:TRU)
Historical Stock Chart
From May 2023 to May 2024