September 13, 2011

Equifax Inc. 

 

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Segment Operating Margins 

 

2008 2009 2010 

6 Mos.  

2010 

6 Mos.  

2011 

U.S. Consumer Information Services 38.9%  36.4%  36.3%  35.9%  35.3% 

International 29.6% 

27.1% 24.7%  25.1%  24.8% 

TALX 17.4% 

21.8% 

23.3% 

22.9% 

21.7% 

North America Personal Solutions 

28.5% 23.0% 28.3% 25.3%  28.1% 

North America Commercial Solutions

19.0% 21.6% 24.2% 21.7% 22.9% 

Total Operating Margin:

24.2% 22.2% 23.1% 23.2%  23.3% 

 

While we will provide a detailed review of each of the Company’s business segments in the following 

sections, below is a brief description of the Company’s products and services by business segment: 

U.S. Consumer Information Solutions (40% of 2010 Revenues; 63% of Operating Income) 

Provides data on consumers to businesses (such as credit information and credit scoring, credit 

modeling services, locate services, fraud detection and prevention services, identity verification services and 

other consulting services; mortgage loan origination information, appraisal, title and closing services; consumer 

financial marketing services; and multi-factor authentication solutions. There are multiple industries that 

purchase products/data from this segment including: 



  Utility/phone companies to evaluate the approval of a new customer  



  Investors to evaluate a securitized loan portfolio 



  Credit card companies to determine how much credit to extend a customer 

International (26% of 2010 Revenues; 28% of Operating Income) 

Provides consumer and commercial credit services (including credit scoring and credit modeling 

services), credit and other marketing products and services, and products and services sold directly to 

consumers.

 

TALX

 

(21% of 2010 Revenues; 21% of Operating Income 

Services includes employment, income and social security number verification (known as The Work 

Number) and employment tax and talent management services. Mortgage companies are the largest user of 

The Work Number and utilize the Work Number to verify an individual’s employment/income. Consumers with 

verified employment on the Work Number are more collectable (~32% higher collections) than those that are 

not. Other customers of the Work Number database include social service providers (approval of low income 

grants), consumer lenders, and auto companies, among others. 

North America Personal Solutions (9% of 2010 Revenues; 10% of Operating Income) 

Includes products that are sold directly to the consumers via the Internet and various hard-copy 

formats including credit information, credit monitoring and identity theft protection. Equifax’s most popular 

Personal Solutions product is a subscription based product (monthly fee) that allows consumers to monitor key 

changes to their credit files from the three national credit bureaus (Equifax, Experian and TransUnion), 

unlimited access to their Equifax credit score and provides $25,000 in identity theft protection. 

North America Commercial Solutions (4% of Operating Revenue; 5% of Operating Income) 

Commercial Solutions provides products that contain information on businesses including credit and 

demographic information, credit scores and portfolio analytics (decisioning tools), which are derived from 

databases of business credit, financial and demographic information. While there are a wide range of uses for 

the Company’s Commercial Solutions information, one application of the Company’s data would be to help 

organizations understand how many of their divisions have separate relationships with the same supplier. The 

organization could then use the information to understand if they are properly leveraging their buying power. 

Customer Mix 

Equifax’s products and services serve clients across a wide range of industries, including financial 

services, mortgage, human resources, telecommunications, healthcare and insurance industries, as well as 

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Equifax Inc. 

 

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state and federal governments. The Company also serves consumers directly offering a suite of products 

including credit monitoring, debt management and identity theft protection. EFX’s revenue stream is highly 

diversified with the Company’s largest customer providing only 3% of total revenue. The following chart 

summarizes the various end-user markets that Equifax serves: 

Customer Mix 

Financial 

Institutions

26%

Marketing 

Services

1%

Telco

7%

Commercial

8%

Consumer

10%

Mortgage

15%

Retail

5%

Auto

4%

Insurance

3%

Government

3%

Other

5%

Corporate 

(Employers)

11%

Resellers

2%

 

Source: Company presentation, August 2011 

Geographic Exposure 

The U.S. (73% of 2010 operating revenues) is clearly the Company’s largest market as no other region 

currently makes up more than 10% of operating revenues. Outside of the U.S., Canada (7%) and the U.K. (6%) 

are the next biggest exposures. Equifax also has operations in Spain, Portugal, and Latin America (Argentina, 

Chile, Ecuador, El Salvador, Honduras, Paraguay, Peru and Uruguay).  

Equifax Geographic Mix ($MM) 

U.S.

72%

Canada

7%

UK

6%

Brazil

5%

Other

10%

 

$1352.2 

2010 Total Operating Revenues: $1.9 Billion

$180.1 

$84.1

$104.7

$138.4

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