Equifax 2001 Annual Report Download - page 29

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Other
Other consists solely of a subcontract, which
expires at the end of May 2002, relating to the
Company’s lottery subsidiary. Revenue and oper-
ating income remained comparable at $9.6 mil-
lion and $8.9 million, respectively, in all periods.
General Corporate
General corporate expense in 2001 increased
$3.1 million on higher incentive plan expense
and increased $5.7 million in 2000 primarily due to
higher technology costs and one-time expenses
associated with our headquarters relocation.
Financial Condition
Cash provided by operations increased 32%
to $255.1 million in 2001, and free cash flow
(operating cash flow less capital expenditures)
increased 72% to $208 million. The improve-
ment over 2000 was largely influenced by higher
operating income from Core Businesses, aggres-
sive management of receivables (days sales
outstanding declined from 75 days in 2000 to 63
days in 2001), and a $24.8 million reduction in
capital expenditures. Cash provided by opera-
tions in 2000 was $192.8 million. Operating cash
flow has been sufficient to fund capital expendi-
tures, dividend payments and scheduled maturi-
ties of long-term debt.
During 2001, the Company’s cash used in invest-
ing activities totaled $106.5 million compared
to $263.0 million in 2000. The Company was less
acquisitive in 2001 versus 2000 as its major focus
was the spin-off of Certegy. Capital expenditures,
exclusive of acquisitions and investments,
amounted to $47.1 million in 2001 compared to
$71.9 million in 2000. Total capital expenditures
in 2002 are expected to approximate $50 mil-
lion. Acquisitions and investments, net of cash
acquired, declined from $346.8 million in 2000 to
$68.7 million in 2001, largely due to the May 2000
CIS acquisition. Cash proceeds generated from
the sale of businesses and other assets amounted
to $12.4 million in 2001 and $157.5 million in
2000, and are principally associated with the
City Directory sale in 2001 and the sales of our
risk management and vehicle information
businesses in 2000.
In 2001, cash used by financing activities totaled
$325.5 million compared to $16.4 million of cash
generated in 2000. In 2001, the Company reduced
its long-term debt $298.9 million through the
repayment of borrowings under its revolving
credit facility. Debt repayments were funded
through operating cash flows and the cash divi-
dend received from Certegy in conjunction with
the spin-off. During the year, the Company
acquired 2.15 million shares of stock at an invest-
ment of $49.5 million. Stock repurchases in 2000
amounted to $6.5 million, down from $210.2 mil-
lion in 1999. The repurchases were temporarily
suspended in 2000 to enable the Company to
apply available cash to the repayment of debt
incurred in connection with the CIS acquisition.
At December 31, 2001, the Company’s remaining
authorization for share repurchases was approx-
imately $45 million, and in February 2002, the
Company’s Board of Directors approved an
additional $250 million for share repurchases.
The Company continued its 89-year history of
paying dividends, which totaled $32.3 million
in 2001. Dividends were $20.0 million lower than
2000 as the Company reduced its quarterly divi-
dend after the Certegy spin-off from $0.093 to
$0.02 per share.
At December 31, 2001, $367.5 million was avail-
able to the Company under its new $465 million
revolving credit facility. Should CSC exercise
its option to sell its credit reporting business to
the Company (Note 10), additional sources of
financing would be required. However, man-
agement believes the Company has sufficiently
broad access to the capital markets to enable it
to arrange alternative sources of financing.
Alternative sources of funding available would
include the public debt markets and additional
bank lines of credit.
Inflation
We do not believe that the rate of inflation has
had a material effect on our operating results.
However, inflation could adversely affect our
future operating results if it were to result in a
substantial weakening in economic conditions.