Equifax 2007 Annual Report Download - page 25

EQUIFAX | 2007 ANNUAL REPORT 23
• Regarding Notes 2 and 3 of the Notes to Consolidated
Financial Statements, the fact that amounts recorded at
December 31, 2007, related to the acquisition of TALX,
and the associated estimates of future amortization, are
preliminary estimates that will be finalized upon the
completion of federal and state tax returns and valuation
of acquired fixed assets;
• With respect to our business outlook discussed under
“Business Overview” in MD&A, our views on the health
and future growth of the U.S. and global economies during
2008; and
• With respect to our USCIS business discussed under “Results
of Operations—Twelve Months Ended December 31, 2007,
2006 and 2005” in MD&A, our ability to protect operating
margins during 2008.
You should not unduly rely on forward-looking statements. They
represent our expectations about the future and are not guarantees.
Forward-looking statements are only as of the date they were made,
and, except as required by law, they might not be updated to refl ect
changes as they occur after the forward-looking statements are made.
RISKS AND UNCERTAINTIES
Risks Related to Our Business and Growth Strategy
If we are not successful in implementing our long-term growth
strategy, we may be unable to grow our business and our results
of operations may be adversely affected.
We have developed a long-term growth strategy which includes
(1) increasing our share of our customers’ spending on information-
related services through the development and introduction of new
products, pricing our services in accordance with the value they
create for customers, increasing the range of current services
utilized by customers, and improving the quality of sales and
customer support interactions with consumers; (2) increasing our
customers’ use of our proprietary analytical, predictive and enabling
technologies; (3) investing in and developing new, differentiated
data sources that provide unique value to customers in their highest
value decisioning needs; and (4) expanding into key emerging
opportunities via acquisitions, partnerships, and/or internal develop-
ment, including related markets in the U.S., such as initiatives in
the commercial, collections, and healthcare markets, as well as new
geographic markets outside the U.S. If we are unable to successfully
execute our growth strategy, we may not be able to grow our
business, growth may occur more slowly than we anticipate, or
our revenues, net income and earnings per share may decline.
We may incur risks related to acquisitions or significant investment
in businesses which could jeopardize the success of these
acquisitions and increase our costs.
Our long-term strategy includes growth through acquisitions and
investments in businesses that offer complementary products,
services and technologies. Any acquisitions or investments,
including our recent acquisition of TALX as described in Part II,
Item 7, “Management’s Discussion and Analysis of Financial
Condition and Results of Operations,” will be accompanied by
the risks commonly encountered in acquisitions of businesses.
Such risks include:
• The financial and strategic goals for the acquired and
combined business may not be achieved;
• The possibility that we will pay more than the acquired
companies or assets are worth;
• Unexpected liabilities arising out of the acquired businesses;
• The difficulty of assimilating the systems, operations and
personnel of the acquired businesses;
• The potential disruption of our ongoing business;
• The potential dilution of our existing shareholders and
earnings per share;
• Unanticipated legal risks and costs;
• The distraction of management from our ongoing
business; and
• The impairment of relationships with employees and
customers as a result of any integration of new
management personnel.
These factors could harm our business, results of operations or
fi nancial position, particularly in the event of a signifi cant acquisition.
The acquisition of businesses having a significant presence
outside the U.S. will increase our relative exposure to the risks
of conducting operations in international markets.
Deterioration of current economic conditions may decrease our
customers’ demand for consumer credit information, which may
harm our results of operations.
Although we continue to take steps to diversify our lines of business,
consumer credit reports we sell in the U.S. and certain international
markets, including the U.K, Canada and in Latin America, remain
a core product. In general, our customers use our credit information
and related services to process applications for new credit cards,
automobile loans, home mortgages, home equity loans and other
consumer loans. They also use our credit information and services
to monitor existing credit relationships. Consumer demand for credit
(i.e., rates of spending and levels of indebtedness) tends to grow
more slowly or decline during periods of economic contraction or
slow economic growth. Rising rates of interest may reduce consumer
demand for mortgage loans and also impact our mortgage services
joint venture. A decline in consumer demand for credit or in levels
of employment may reduce our customers’ demand for our consumer
credit information. Consequently, our revenues from consumer credit
information products and services could be negatively affected
and our results of operations harmed if consumer demand for credit
decreases. In addition, if current economic conditions in the
U.S. decline further, this decline could detrimentally impact
the economies of the countries outside the U.S. in which we
operate and could infl uence customer demand for our non-consumer
credit information-based businesses, including North America
Commercial Solutions and TALX, which could further negatively
impact our results of operations.