Delaware Delaware | 333-182948 333-172549 | 36-1678417 74-3135689 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
555 West Adams Street, Chicago, Illinois | 60,661 | |
(Address of Principal Executive Offices) | (Zip Code) |
⃞ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
⃞ | Soliciting material pursuant to Rule 14a−12 under the Exchange Act (17 CFR 240.14a−12) |
⃞ | Pre−commencement communications pursuant to Rule 14d−2(b) under the Exchange Act (17 CFR 240.14d−2(b)) |
⃞ | Pre−commencement communications pursuant to Rule 13e−4(c) under the Exchange Act (17 CFR 240.13e− 4(c)) |
Exhibit No. | Description | ||
Exhibit 99.1 | Press release of TransUnion Holding Company, Inc. and TransUnion Corp., dated November 13, 2013, announcing results for the quarter ended September 30, 2013 | ||
Contact | Lindsey Whitehead |
TransUnion | |
E-mail | investor.relations@transunion.com |
Telephone | 312 985 2860 |
• | Total revenue for the third quarter increased 2.7 percent compared to the third quarter of 2012. Weakening foreign currencies accounted for a decrease in revenue of 1.9 percent, while acquisitions accounted for an increase in revenue of 1.1 percent. Key highlights include: |
• | Revenue in the Interactive segment increased 10.5 percent compared to the third quarter of 2012, driven by an increase in the average number of subscribers and volume in our indirect channel and an increase in our average revenue per subscriber in our direct channel. |
• | Revenue in USIS Decision Services increased 10.0 percent compared to the third quarter of 2012, driven by revenue from our recent healthcare acquisition of eScan and organic growth in the healthcare market. |
• | Excluding the impact of foreign currencies and acquisitions, revenue in the International segment increased 8.4 percent compared to the third quarter of 2012. |
• | Adjusted EBITDA(2) was $99.5 million, a decrease of 6.1 percent compared to the prior year, due to investments in new initiatives to drive long-term revenue growth and more efficient operations. |
• | On September 4, 2013, TransUnion completed the acquisition of e-Scan Data Systems Inc. (“eScan”). eScan provides services to hospitals and healthcare providers to efficiently capture uncompensated care costs in their revenue management cycle programs. eScan will be integrated into TransUnion's healthcare business. |
• | Online Data Services revenue was $129.3 million, an increase of 0.7 percent compared to the third quarter of 2012, driven by an increase in average pricing and a slight increase in online credit report volumes. |
• | Credit Marketing Services revenue was $31.5 million, a decrease of 3.7 percent compared to the third quarter of 2012, due primarily to a decrease in demand for custom data sets and archive information. |
• | Decision Services revenue was $27.5 million, an increase of 10.0 percent compared to the third quarter of 2012, driven by revenue from our acquisition of eScan and organic growth in our healthcare business. |
• | Developed markets revenue was $24.6 million, an increase of 7.9 percent compared to the third quarter of 2012. Excluding the impact of foreign currencies, revenue increased 10.8 percent compared to the third quarter of 2012. |
• | Emerging markets revenue was $36.0 million, a decrease of 2.7 percent compared to the third quarter of 2012. Excluding the impact of weakening foreign currencies, revenue increased by 12.1 percent compared to the third quarter of 2012. |
• | Revenue for U.S. Information Services was $560.0 million, an increase of 2.3 percent compared to the first nine months of 2012. |
• | Revenue for International was $177.5 million, an increase of 2.1 percent compared to the first nine months of 2012. Excluding the impact of foreign currencies and acquisitions, revenue increased 6.4 percent compared to the first nine months of 2012. Weakening foreign currencies accounted for a reduction in revenue of 7.4 percent. Acquisitions accounted for an increase in revenue of 3.0 percent. |
• | Revenue for Interactive was $ 153.3 million, an increase of 14.2 percent compared to the first nine months of 2012. |
September 30, 2013 | December 31, 2012 | ||||||
Unaudited | |||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 117.5 | $ | 154.3 | |||
Trade accounts receivable, net of allowance of $0.9 and $1.7 | 183.7 | 163.6 | |||||
Other current assets | 63.9 | 82.7 | |||||
Total current assets | 365.1 | 400.6 | |||||
Property, plant and equipment, net of accumulated depreciation and amortization of $59.0 and $26.4 | 125.2 | 121.2 | |||||
Other marketable securities | 11.6 | 11.4 | |||||
Goodwill | 1,855.4 | 1,804.2 | |||||
Other intangibles, net of accumulated amortization of $190.6 and $86.6 | 1,882.2 | 1,911.6 | |||||
Other assets | 135.5 | 129.8 | |||||
Total assets | $ | 4,375.0 | $ | 4,378.8 | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities: | |||||||
Trade accounts payable | $ | 82.3 | $ | 78.4 | |||
Short-term debt and current portion of long-term debt | 76.1 | 10.6 | |||||
Other current liabilities | 130.7 | 129.3 | |||||
Total current liabilities | 289.1 | 218.3 | |||||
Long-term debt | 2,650.5 | 2,670.3 | |||||
Other liabilities | 678.1 | 679.4 | |||||
Total liabilities | 3,617.7 | 3,568.0 | |||||
Redeemable noncontrolling interests | 18.5 | 14.7 | |||||
Stockholders’ equity: | |||||||
Common stock, $0.01 par value; 200.0 million shares authorized at September 30, 2013, 110.3 million and 110.2 million shares issued at September 30, 2013 and December 31, 2012, respectively, and 109.9 million shares and 110.1 million shares outstanding as of September 30, 2013 and December 31, 2012, respectively | 1.1 | 1.1 | |||||
Additional paid-in capital | 1,116.0 | 1,109.4 | |||||
Treasury stock at cost; 0.5 million shares at September 30, 2013 and 0.1 million shares at December 31, 2012 | (3.7 | ) | (0.7 | ) | |||
Accumulated deficit | (400.1 | ) | (382.6 | ) | |||
Accumulated other comprehensive loss | (64.4 | ) | (24.4 | ) | |||
Total TransUnion Holding Company, Inc. stockholders’ equity | 648.9 | 702.8 | |||||
Noncontrolling interests | 89.9 | 93.3 | |||||
Total stockholders’ equity | 738.8 | 796.1 | |||||
Total liabilities and stockholders’ equity | $ | 4,375.0 | $ | 4,378.8 |
Three Months Ended September 30, | Nine Months Ended September 30, | From the Date of Inception Through September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Revenue | $ | 299.5 | $ | 291.7 | $ | 890.8 | $ | 482.6 | |||||||
Operating expenses | |||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 115.9 | 111.5 | 354.9 | 186.2 | |||||||||||
Selling, general and administrative | 86.3 | 75.8 | 264.5 | 126.5 | |||||||||||
Depreciation and amortization | 48.0 | 43.1 | 138.5 | 72.1 | |||||||||||
Total operating expenses | 250.2 | 230.4 | 757.9 | 384.8 | |||||||||||
Operating income | 49.3 | 61.3 | 132.9 | 97.8 | |||||||||||
Non-operating income and expense | |||||||||||||||
Interest expense | (49.0 | ) | (42.6 | ) | (148.1 | ) | (77.4 | ) | |||||||
Interest income | 0.8 | 0.6 | 1.3 | 0.7 | |||||||||||
Other income and (expense), net | 1.4 | (0.6 | ) | 2.5 | (15.4 | ) | |||||||||
Total non-operating income and expense | (46.8 | ) | (42.6 | ) | (144.3 | ) | (92.1 | ) | |||||||
Income (loss) before income taxes | 2.5 | 18.7 | (11.4 | ) | 5.7 | ||||||||||
Provision for income taxes | (3.9 | ) | (5.2 | ) | (1.1 | ) | (3.0 | ) | |||||||
Net income (loss) | (1.4 | ) | 13.5 | (12.5 | ) | 2.7 | |||||||||
Less: net income attributable to the noncontrolling interests | (2.0 | ) | (2.2 | ) | (5.0 | ) | (3.3 | ) | |||||||
Net income (loss) attributable to TransUnion Holding Company Inc. | $ | (3.4 | ) | $ | 11.3 | $ | (17.5 | ) | $ | (0.6 | ) |
Nine Months Ended September 30, 2013 | From the Date of Inception Through September 30, 2012 | ||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | (12.5 | ) | $ | 2.7 | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||
Depreciation and amortization | 138.5 | 72.1 | |||||
Deferred financing fees | 6.7 | 1.0 | |||||
Stock-based compensation | 4.8 | 1.2 | |||||
Provision for losses on trade accounts receivable | 0.7 | (2.2 | ) | ||||
Equity in net income of affiliates, net of dividends | (0.9 | ) | 3.0 | ||||
Deferred taxes | (12.1 | ) | (5.1 | ) | |||
Amortization of senior notes purchase accounting fair value adjustment and note discount | (12.7 | ) | (6.6 | ) | |||
Gain on sale of other assets | (1.2 | ) | — | ||||
Other | (0.4 | ) | 2.7 | ||||
Changes in assets and liabilities: | |||||||
Trade accounts receivable | (14.7 | ) | (14.2 | ) | |||
Other current and long-term assets | 3.2 | (76.0 | ) | ||||
Trade accounts payable | (1.4 | ) | (3.8 | ) | |||
Other current and long-term liabilities | 13.1 | 7.3 | |||||
Cash provided by (used in) operating activities | 111.1 | (17.9 | ) | ||||
Cash flows from investing activities: | |||||||
Capital expenditures for property and equipment | (54.1 | ) | (26.2 | ) | |||
Proceeds from sale of trading securities | 2.2 | — | |||||
Investments in trading securities | (1.7 | ) | (0.3 | ) | |||
Acquisition of TransUnion Corp., net of cash acquired | — | (1,485.9 | ) | ||||
Other acquisitions and purchases of noncontrolling interests, net of cash acquired | (135.8 | ) | (10.5 | ) | |||
Proceeds from sale of other assets | 4.2 | — | |||||
Acquisition related deposits | (9.0 | ) | — | ||||
Other | 1.7 | (1.5 | ) | ||||
Cash used in investing activities | (192.5 | ) | (1,524.4 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from 9.625% notes | — | 600.0 | |||||
Proceeds from senior secured credit facility | 923.4 | — | |||||
Extinguishment of senior secured credit facility | (923.4 | ) | — | ||||
Proceeds from senior secured revolving line of credit | 65.0 | — | |||||
Repayments of debt | (8.7 | ) | (4.8 | ) | |||
Proceeds from capital lease | 2.0 | — | |||||
Proceeds from issuance of common stock | 1.5 | 1,094.5 | |||||
Debt financing fees | (4.1 | ) | (16.8 | ) | |||
Treasury stock purchases | (3.0 | ) | (0.7 | ) | |||
Distributions to noncontrolling interests | (2.8 | ) | (2.1 | ) | |||
Other | — | — | |||||
Cash provided by financing activities | 49.9 | 1,670.1 | |||||
Effect of exchange rate changes on cash and cash equivalents | (5.3 | ) | (0.6 | ) | |||
Net change in cash and cash equivalents | (36.8 | ) | 127.2 | ||||
Cash and cash equivalents, beginning of period | 154.3 | — | |||||
Cash and cash equivalents, end of period | $ | 117.5 | $ | 127.2 |
Successor | Successor | ||||||
September 30, 2013 | December 31, 2012 | ||||||
Unaudited | |||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 117.5 | $ | 154.3 | |||
Trade accounts receivable, net of allowance of $0.9 and $1.7 | 183.7 | 163.6 | |||||
Other current assets | 36.1 | 58.7 | |||||
Total current assets | 337.3 | 376.6 | |||||
Property, plant and equipment, net of accumulated depreciation and amortization of $59.0 and $26.4 | 125.2 | 121.2 | |||||
Other marketable securities | 11.6 | 11.4 | |||||
Goodwill | 1,855.4 | 1,804.2 | |||||
Other intangibles, net of accumulated amortization of $190.6 and $86.6 | 1,882.2 | 1,911.6 | |||||
Other assets | 105.8 | 95.7 | |||||
Total assets | $ | 4,317.5 | $ | 4,320.7 | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities: | |||||||
Trade accounts payable | $ | 82.0 | $ | 77.5 | |||
Short-term debt and current portion of long-term debt | 76.1 | 10.6 | |||||
Other current liabilities | 128.6 | 107.0 | |||||
Total current liabilities | 286.7 | 195.1 | |||||
Long-term debt | 1,652.3 | 1,672.3 | |||||
Other liabilities | 667.3 | 667.4 | |||||
Total liabilities | 2,606.3 | 2,534.8 | |||||
Redeemable noncontrolling interests | 18.5 | 14.7 | |||||
Stockholders’ equity: | |||||||
Common stock, $0.01 par value; one thousand shares authorized, one hundred shares issued at September 30, 2013, and December 31, 2012; one hundred shares outstanding as of September 30, 2013, and December 31, 2012 | — | — | |||||
Additional paid-in capital | 1,692.3 | 1,687.2 | |||||
Treasury stock at cost; 0 shares at September 30, 2013, and December 31, 2012 | — | — | |||||
Retained earnings (accumulated deficit) | (25.1 | ) | 15.1 | ||||
Accumulated other comprehensive loss | (64.4 | ) | (24.4 | ) | |||
Total TransUnion Corp. stockholders’ equity | 1,602.8 | 1,677.9 | |||||
Noncontrolling interests | 89.9 | 93.3 | |||||
Total stockholders’ equity | 1,692.7 | 1,771.2 | |||||
Total liabilities and stockholders’ equity | $ | 4,317.5 | $ | 4,320.7 |
TransUnion Corp Successor | TransUnion Corp Predecessor | |||||||||||||||||||
Three Months Ended September 30, 2013 | Three Months Ended September 30, 2012 | Nine Months Ended September 30, 2013 | Five Months Ended September 30, 2012 | Four Months Ended April 30, 2012 | ||||||||||||||||
Revenue | $ | 299.5 | $ | 291.7 | $ | 890.8 | $ | 482.6 | $ | 373.0 | ||||||||||
Operating expenses | ||||||||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 115.9 | 111.5 | 354.9 | 186.2 | 172.0 | |||||||||||||||
Selling, general and administrative | 85.9 | 75.5 | 263.4 | 125.8 | 172.0 | |||||||||||||||
Depreciation and amortization | 48.0 | 43.1 | 138.5 | 72.1 | 29.2 | |||||||||||||||
Total operating expenses | 249.8 | 230.1 | 756.8 | 384.1 | 373.2 | |||||||||||||||
Operating income (loss) | 49.7 | 61.6 | 134.0 | 98.5 | (0.2 | ) | ||||||||||||||
Non-operating income and expense | ||||||||||||||||||||
Interest expense | (24.9 | ) | (27.6 | ) | (75.9 | ) | (46.0 | ) | (40.5 | ) | ||||||||||
Interest income | 0.8 | 0.6 | 1.3 | 0.7 | 0.6 | |||||||||||||||
Other income and (expense), net | 1.6 | (0.6 | ) | 2.5 | (0.2 | ) | (23.8 | ) | ||||||||||||
Total non-operating income and expense | (22.5 | ) | (27.6 | ) | (72.1 | ) | (45.5 | ) | (63.7 | ) | ||||||||||
Income (loss) before income taxes | 27.2 | 34.0 | 61.9 | 53.0 | (63.9 | ) | ||||||||||||||
(Provision) benefit for income taxes | (7.7 | ) | (11.0 | ) | (19.1 | ) | (19.3 | ) | 11.5 | |||||||||||
Net income (loss) | 19.5 | 23.0 | 42.8 | 33.7 | (52.4 | ) | ||||||||||||||
Less: net income attributable to noncontrolling interests | (2.0 | ) | (2.2 | ) | (5.0 | ) | (3.3 | ) | (2.5 | ) | ||||||||||
Net income (loss) attributable to TransUnion Corp. | $ | 17.5 | $ | 20.8 | $ | 37.8 | $ | 30.4 | $ | (54.9 | ) |
Successor | Predecessor | |||||||||||
Nine Months Ended September 30, 2013 | Five Months Ended September 30, 2012 | Four Months Ended April 30, 2012 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net income (loss) | $ | 42.8 | $ | 33.7 | $ | (52.4 | ) | |||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||
Change in control transaction fees | — | 0.3 | 20.9 | |||||||||
Depreciation and amortization | 138.5 | 72.1 | 29.2 | |||||||||
Deferred financing fees | 2.5 | — | 3.9 | |||||||||
Stock-based compensation | 4.8 | 0.8 | 2.0 | |||||||||
Provision (reduction) for losses on trade accounts receivable | 0.7 | (2.2 | ) | 3.1 | ||||||||
Equity in net income of affiliates, net of dividends | (0.9 | ) | 3.0 | (3.7 | ) | |||||||
Deferred taxes | (6.6 | ) | 10.5 | (18.3 | ) | |||||||
Amortization of senior notes purchase accounting fair value adjustment | (12.9 | ) | (6.6 | ) | — | |||||||
Loss (gain) on sale of other assets | (1.2 | ) | — | 0.1 | ||||||||
Other | (0.4 | ) | 2.7 | (0.7 | ) | |||||||
Changes in assets and liabilities: | ||||||||||||
Trade accounts receivable | (14.7 | ) | (14.2 | ) | (24.7 | ) | ||||||
Other current and long-term assets | 0.8 | 4.1 | 1.5 | |||||||||
Trade accounts payable | (1.3 | ) | (4.0 | ) | 1.6 | |||||||
Other current and long-term liabilities | 34.6 | (23.1 | ) | 89.9 | ||||||||
Cash provided by operating activities | 186.7 | 77.1 | 52.4 | |||||||||
Cash flows from investing activities: | ||||||||||||
Capital expenditures for property and equipment | (54.1 | ) | (26.2 | ) | (20.4 | ) | ||||||
Proceeds from sale of trading securities | 2.2 | — | 1.1 | |||||||||
Investments in trading securities | (1.7 | ) | (0.3 | ) | (1.1 | ) | ||||||
Acquisitions and purchases of noncontrolling interests, net of cash acquired | (135.8 | ) | (10.5 | ) | (0.1 | ) | ||||||
Proceeds from sale of other assets | 4.2 | — | 0.2 | |||||||||
Acquisition related deposits | (9.0 | ) | — | — | ||||||||
Other | 1.7 | (1.5 | ) | 0.7 | ||||||||
Cash used in investing activities | (192.5 | ) | (38.5 | ) | (19.6 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from senior secured credit facility | 923.4 | — | — | |||||||||
Extinguishment of senior secured credit facility | (923.4 | ) | — | — | ||||||||
Proceeds from senior secured revolving line of credit | 65.0 | — | — | |||||||||
Repayments of debt | (8.7 | ) | (4.8 | ) | (14.6 | ) | ||||||
Proceeds from capital lease | 2.0 | — | — | |||||||||
Debt financing fees | (3.2 | ) | — | (6.1 | ) | |||||||
Distribution of merger consideration | — | — | (1.3 | ) | ||||||||
Change in control transaction fees | — | (0.3 | ) | (20.9 | ) | |||||||
Distributions to noncontrolling interests | (2.8 | ) | (2.1 | ) | (0.4 | ) | ||||||
Dividends to TransUnion Holding | (78.0 | ) | — | — | ||||||||
Other | — | — | (1.7 | ) | ||||||||
Cash used in financing activities | (25.7 | ) | (7.2 | ) | (45.0 | ) | ||||||
Effect of exchange rate changes on cash and cash equivalents | (5.3 | ) | (0.6 | ) | 0.8 | |||||||
Net change in cash and cash equivalents | (36.8 | ) | 30.8 | (11.4 | ) | |||||||
Cash and cash equivalents, beginning of period | 154.3 | 96.4 | 107.8 | |||||||||
Cash and cash equivalents, end of period | $ | 117.5 | $ | 127.2 | $ | 96.4 |
TransUnion Holding Consolidated | |||||||||||||||
Three Months Ended September 30, | |||||||||||||||
(in millions) | 2013 | 2012 | $ Change | % Change | |||||||||||
Revenue | $ | 299.5 | $ | 291.7 | $ | 7.8 | 2.7 | % | |||||||
Operating expenses | |||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 115.9 | 111.5 | 4.4 | 3.9 | % | ||||||||||
Selling, general and administrative | 86.3 | 75.8 | 10.5 | 13.9 | % | ||||||||||
Depreciation and amortization | 48.0 | 43.1 | 4.9 | 11.4 | % | ||||||||||
Total operating expenses | 250.2 | 230.4 | 19.8 | 8.6 | % | ||||||||||
Operating income | 49.3 | 61.3 | (12.0 | ) | (19.6 | )% | |||||||||
Non-operating income and expense | |||||||||||||||
Interest expense | (49.0 | ) | (42.6 | ) | (6.4 | ) | (15.0 | )% | |||||||
Interest income | 0.8 | 0.6 | 0.2 | 33.3 | % | ||||||||||
Other income and (expense), net | 1.4 | (0.6 | ) | 2.0 | 333.3 | % | |||||||||
Total non-operating income and expense | (46.8 | ) | (42.6 | ) | (4.2 | ) | (9.9 | )% | |||||||
Income (loss) from operations before income taxes | 2.5 | 18.7 | (16.2 | ) | (86.6 | )% | |||||||||
Provision for income taxes | (3.9 | ) | (5.2 | ) | 1.3 | 25.0 | % | ||||||||
Net income (loss) | (1.4 | ) | 13.5 | (14.9 | ) | (110.4 | )% | ||||||||
Less: net income attributable to noncontrolling interests | (2.0 | ) | (2.2 | ) | 0.2 | 9.1 | % | ||||||||
Net income (loss) attributable to the Company | $ | (3.4 | ) | $ | 11.3 | $ | (14.7 | ) | (130.1 | )% |
Nine Months Ended September 30, | |||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||
TransUnion Holding | TransUnion Holding | TransUnion Corp. Predecessor Four Months Ended April 30, 2012 | |||||||||||||||||||||
(in millions) | Nine Months Ended September 30, 2013 | Date of Inception Through September 30, 2012 | Combined Nine Months Ended September 30, 2012 | $ Change | % Change | ||||||||||||||||||
Revenue | $ | 890.8 | $ | 482.6 | $ | 373.0 | $ | 855.6 | $ | 35.2 | 4.1 | % | |||||||||||
Operating expenses | |||||||||||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 354.9 | 186.2 | 172.0 | 358.2 | (3.3 | ) | (0.9 | )% | |||||||||||||||
Selling, general and administrative | 264.5 | 126.5 | 172.0 | 298.5 | (34.0 | ) | (11.4 | )% | |||||||||||||||
Depreciation and amortization | 138.5 | 72.1 | 29.2 | 101.3 | 37.2 | 36.7 | % | ||||||||||||||||
Total operating expenses | 757.9 | 384.8 | 373.2 | 758.0 | (0.1 | ) | — | ||||||||||||||||
Operating income (loss) | 132.9 | 97.8 | (0.2 | ) | 97.6 | 35.3 | 36.2 | % | |||||||||||||||
Non-operating income and expense | |||||||||||||||||||||||
Interest expense | (148.1 | ) | (77.4 | ) | (40.5 | ) | (117.9 | ) | (30.2 | ) | (25.6 | )% | |||||||||||
Interest income | 1.3 | 0.7 | 0.6 | 1.3 | — | — | |||||||||||||||||
Other income and (expense), net | 2.5 | (15.4 | ) | (23.8 | ) | (39.2 | ) | 41.7 | 106.4 | % | |||||||||||||
Total non-operating income and expense | (144.3 | ) | (92.1 | ) | (63.7 | ) | (155.8 | ) | 11.5 | 7.4 | % | ||||||||||||
Income (loss) from operations before income taxes | (11.4 | ) | 5.7 | (63.9 | ) | (58.2 | ) | 46.8 | 80.4 | % | |||||||||||||
(Provision) benefit for income taxes | (1.1 | ) | (3.0 | ) | 11.5 | 8.5 | (9.6 | ) | (112.9 | )% | |||||||||||||
Net income (loss) | (12.5 | ) | 2.7 | (52.4 | ) | (49.7 | ) | 37.2 | 74.8 | % | |||||||||||||
Less: net income attributable to noncontrolling interests | (5.0 | ) | (3.3 | ) | (2.5 | ) | (5.8 | ) | 0.8 | 13.8 | % | ||||||||||||
Net loss attributable to the Company | $ | (17.5 | ) | $ | (0.6 | ) | $ | (54.9 | ) | $ | (55.5 | ) | $ | 38.0 | 68.5 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||
(in millions) | 2013 | 2012 | $ Change | % Change | 2013 | 2012 | $ Change | % Change | ||||||||||||||||||||||
Revenue | ||||||||||||||||||||||||||||||
U.S. Information Services: | ||||||||||||||||||||||||||||||
Online Data Services | $ | 129.3 | $ | 128.4 | $ | 0.9 | 0.7 | % | $ | 388.5 | $ | 375.5 | $ | 13.0 | 3.5 | % | ||||||||||||||
Credit Marketing Services | 31.5 | 32.7 | (1.2 | ) | (3.7 | )% | 94.2 | 99.5 | (5.3 | ) | (5.3 | )% | ||||||||||||||||||
Decision Services | 27.5 | 25.0 | 2.5 | 10.0 | % | 77.3 | 72.5 | 4.8 | 6.6 | % | ||||||||||||||||||||
Total U.S. Information Services | 188.3 | 186.1 | 2.2 | 1.2 | % | 560.0 | 547.5 | 12.5 | 2.3 | % | ||||||||||||||||||||
International: | ||||||||||||||||||||||||||||||
Developed markets | 24.6 | 22.8 | 1.8 | 7.9 | % | 71.1 | 68.2 | 2.9 | 4.3 | % | ||||||||||||||||||||
Emerging markets | 36.0 | 37.0 | (1.0 | ) | (2.7 | )% | 106.4 | 105.7 | 0.7 | 0.7 | % | |||||||||||||||||||
Total International | 60.6 | 59.8 | 0.8 | 1.3 | % | 177.5 | 173.9 | 3.6 | 2.1 | % | ||||||||||||||||||||
Interactive | 50.6 | 45.8 | 4.8 | 10.5 | % | 153.3 | 134.2 | 19.1 | 14.2 | % | ||||||||||||||||||||
Total revenue | $ | 299.5 | $ | 291.7 | $ | 7.8 | 2.7 | % | $ | 890.8 | $ | 855.6 | $ | 35.2 | 4.1 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||
(in millions) | 2013 | 2012 | $ Change | % Change | 2013 | 2012 | $ Change | % Change | ||||||||||||||||||||||
Operating Income(1) | ||||||||||||||||||||||||||||||
U.S. Information Services | $ | 41.9 | $ | 47.5 | $ | (5.6 | ) | (11.8 | )% | $ | 122.2 | $ | 114.0 | $ | 8.2 | 7.2 | % | |||||||||||||
International | 9.0 | 9.9 | (0.9 | ) | (9.1 | )% | 15.4 | 18.3 | (2.9 | ) | (15.8 | )% | ||||||||||||||||||
Interactive | 16.7 | 20.4 | (3.7 | ) | (18.1 | )% | 48.0 | 44.4 | 3.6 | 8.1 | % | |||||||||||||||||||
Corporate | (18.3 | ) | (16.5 | ) | (1.8 | ) | (10.9 | )% | (52.7 | ) | (79.1 | ) | 26.4 | 33.4 | % | |||||||||||||||
Total operating income | $ | 49.3 | $ | 61.3 | $ | (12.0 | ) | (19.6 | )% | $ | 132.9 | $ | 97.6 | $ | 35.3 | 36.2 | % | |||||||||||||
Operating Margin | ||||||||||||||||||||||||||||||
U.S. Information Services | 22.3 | % | 25.5 | % | (3.2 | )% | 21.8 | % | 20.8 | % | 1.0 | % | ||||||||||||||||||
International | 14.9 | % | 16.6 | % | (1.7 | )% | 8.7 | % | 10.5 | % | (1.8 | )% | ||||||||||||||||||
Interactive | 33.0 | % | 44.5 | % | (11.5 | )% | 31.3 | % | 33.1 | % | (1.8 | )% | ||||||||||||||||||
Total operating margin | 16.5 | % | 21.0 | % | (4.5 | )% | 14.9 | % | 11.4 | % | 3.5 | % | ||||||||||||||||||
Adjusted Operating Income(2) | ||||||||||||||||||||||||||||||
U.S. Information Services | $ | 41.9 | $ | 47.5 | $ | (5.6 | ) | (11.8 | )% | $ | 123.8 | $ | 155.1 | $ | (31.3 | ) | (20.2 | )% | ||||||||||||
International | 9.0 | 9.9 | (0.9 | ) | (9.1 | )% | 17.7 | 32.7 | (15.0 | ) | (45.9 | )% | ||||||||||||||||||
Interactive | 16.7 | 20.4 | (3.7 | ) | (18.1 | )% | 48.0 | 46.7 | 1.3 | 2.8 | % | |||||||||||||||||||
Corporate | (18.3 | ) | (16.5 | ) | (1.8 | ) | (10.9 | )% | (52.5 | ) | (46.3 | ) | (6.2 | ) | (13.4 | )% | ||||||||||||||
Total Adjusted Operating Income | $ | 49.3 | $ | 61.3 | $ | (12.0 | ) | (19.6 | )% | $ | 137.0 | $ | 188.2 | $ | (51.2 | ) | (27.2 | )% | ||||||||||||
Adjusted Operating Margin | ||||||||||||||||||||||||||||||
U.S. Information Services | 22.3 | % | 25.5 | % | (3.2 | )% | 22.1 | % | 28.3 | % | (6.2 | )% | ||||||||||||||||||
International | 14.9 | % | 16.6 | % | (1.7 | )% | 10.0 | % | 18.8 | % | (8.8 | )% | ||||||||||||||||||
Interactive | 33.0 | % | 44.5 | % | (11.5 | )% | 31.3 | % | 34.8 | % | (3.5 | )% | ||||||||||||||||||
Total adjusted operating margin | 16.5 | % | 21.0 | % | (4.5 | )% | 15.4 | % | 22.0 | % | (6.6 | )% |
(1) | For the three and nine months ended September 30, 2013, operating income included additional depreciation and amortization as a result of the purchase accounting fair value adjustments to the tangible and intangible assets recorded in connection with the 2012 Change in Control Transaction. The increase in depreciation and amortization in the three months ended September 30, 2013, compared to the three months ended September 30, 2012, was as follows: USIS $3.6 million; International $0.6 million; Interactive $0.4 million; and Corporate $0.4 million. The increase in depreciation and amortization in the nine months ended September 30, 2013, which is related primarily to the purchase accounting fair value adjustments, compared to the nine months ended September 30, 2012, was as follows: USIS $23.9 million; International $10.0 million; Interactive $2.1 million; and Corporate $1.3 million. For the nine months ended September 30, 2013, operating income included a $2.3 million loss on the disposal of a small operating company recorded in our International segment, a $1.1 million gain on the disposal of a healthcare product line recorded in our USIS segment and a $2.9 million one-time adjustment for a transaction tax related to prior years that was recorded in each segment and in Corporate as follows: USIS $2.6 million; and Corporate $0.3 million. For the nine months ended September 30, 2012, operating income included $90.6 million of accelerated stock-based compensation and related expense recorded by the Predecessor as a result of the 2012 Change in Control Transaction that were recorded in each segment and in Corporate as follows: USIS $41.1 million; International $14.4 million; Interactive $2.3 million; and Corporate $32.8 million. See Part I, Item 1, Note 2, “2012 Change in Control Transaction,” for further information about the impact of the 2012 Change in Control Transaction. |
(2) | See footnote 2 to Key Performance Measure for a discussion about Adjusted Operating Income, why we use it, its limitations, and the reconciliation to its most directly comparable GAAP measure, operating income. |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||
(in millions) | 2013 | 2012 | $ Change | % Change | 2013 | 2012 | $ Change | % Change | ||||||||||||||||||||||
Revenue | $ | 299.5 | $ | 291.7 | $ | 7.8 | 2.7 | % | $ | 890.8 | $ | 855.6 | $ | 35.2 | 4.1 | % | ||||||||||||||
Reconciliation of operating income to Adjusted Operating Income: | ||||||||||||||||||||||||||||||
Operating income | $ | 49.3 | $ | 61.3 | $ | (12.0 | ) | (19.6 | )% | $ | 132.9 | $ | 97.6 | $ | 35.3 | 36.2 | % | |||||||||||||
Adjustments(1) | — | — | — | — | 4.1 | 90.6 | (86.5 | ) | (95.5 | )% | ||||||||||||||||||||
Adjusted Operating Income(2) | $ | 49.3 | $ | 61.3 | $ | (12.0 | ) | (19.6 | )% | $ | 137.0 | $ | 188.2 | $ | (51.2 | ) | (27.2 | )% | ||||||||||||
Reconciliation of net income (loss) attributable to the Company to Adjusted EBITDA: | ||||||||||||||||||||||||||||||
Net income (loss) attributable to the Company | $ | (3.4 | ) | $ | 11.3 | $ | (14.7 | ) | (130.1 | )% | $ | (17.5 | ) | $ | (55.5 | ) | $ | 38.0 | 68.5 | % | ||||||||||
Net interest expense | 48.2 | 42.0 | 6.2 | 14.8 | % | 146.8 | 116.6 | 30.2 | 25.9 | % | ||||||||||||||||||||
Income tax (benefit) provision | 3.9 | 5.2 | (1.3 | ) | (25.0 | )% | 1.1 | (8.5 | ) | 9.6 | 112.9 | % | ||||||||||||||||||
Depreciation and amortization(3) | 48.0 | 43.1 | 4.9 | 11.4 | % | 138.5 | 101.3 | 37.2 | 36.7 | % | ||||||||||||||||||||
Stock-based compensation | 1.2 | 0.8 | 0.4 | 50.0 | % | 4.8 | 2.8 | 2.0 | 71.4 | % | ||||||||||||||||||||
Other (income) and expense(4) | 1.6 | 3.6 | (2.0 | ) | (55.6 | )% | 8.3 | 49.0 | (40.7 | ) | (83.1 | )% | ||||||||||||||||||
Adjustments(1) | — | — | — | — | 4.1 | 90.6 | (86.5 | ) | (95.5 | )% | ||||||||||||||||||||
Adjusted EBITDA(2) | $ | 99.5 | $ | 106.0 | $ | (6.5 | ) | (6.1 | )% | $ | 286.1 | $ | 296.3 | $ | (10.2 | ) | (3.4 | )% | ||||||||||||
Other metrics: | ||||||||||||||||||||||||||||||
Cash provided by operating activities | $ | 63.8 | $ | 66.7 | $ | (2.9 | ) | (4.3 | )% | $ | 111.1 | $ | 34.5 | $ | 76.6 | 222.0 | % | |||||||||||||
Capital expenditures | $ | 23.9 | $ | 18.8 | $ | 5.1 | 27.1 | % | $ | 54.1 | $ | 46.6 | $ | 7.5 | 16.1 | % |
(1) | For the nine months ended September 30, 2013, adjustments included a $2.3 million loss on the disposal of a small operating company recorded in our International segment, a $1.1 million gain on the disposal of a healthcare product line recorded in our USIS segment and a $2.9 million one-time adjustment for a transaction tax related to prior years that was recorded in each segment and in Corporate as follows: USIS $2.6 million; and Corporate $0.3 million. For the nine months ended September 30, 2012, adjustments included $90.6 million of accelerated stock-based compensation and related expense recorded by the Predecessor as a result of the 2012 Change in Control Transaction that were recorded in each segment and in Corporate as follows: USIS $41.1 million; International $14.4 million; Interactive $2.3 million; and Corporate $32.8 million. |
(2) | Adjusted Operating Income and Adjusted EBITDA are non-GAAP measures. We present Adjusted Operating Income and Adjusted EBITDA as supplemental measures of our operating performance because they eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance. In addition to its use as a measure of our operating performance, our board of directors and executive management team focus on Adjusted EBITDA as a compensation measure. Adjusted Operating Income does not reflect certain stock-based compensation and certain other income and expense. Adjusted EBITDA does not reflect our capital expenditures, interest, income tax, depreciation, |
(3) | Operating income included additional depreciation and amortization beginning May 1, 2012, as a result of the purchase accounting fair value adjustments to the tangible and intangible assets recorded in connection with the 2012 Change in Control Transaction. |
(4) | Other income and expense above includes all amounts included on our consolidated statement of income in other income and expense, net, except for earnings from equity method investments and dividends received from cost method investments. For the three months ended September 30, 2013, other income and expense included $0.8 million of acquisition-related expenses and a net $0.8 million of other expense. For the nine months ended September 30, 2013, other income and expense included $6.4 million of acquisition-related expenses and a net $1.9 million of other expense. For the three months ended September 30, 2012, other income and expense included $0.6 million of acquisition-related expenses and a net $3.0 million of other expense. For the nine months ended September 30, 2012, other income and expense included $41.9 million of acquisition-related expenses, primarily related to the 2012 Change in Control Transaction and the abandoned initial public offering process, and a net $7.1 million of other expense. Of the $41.9 million of acquisition-related expenses, $15.2 million was incurred by TransUnion Holding and $26.7 million was incurred by TransUnion Corp. |