Equifax 2008 Annual Report Download - page 17

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The 2007 increase in depreciation and amortization expense related to our acquisitions of Austin-Tetra in Octo-
expense, as compared to 2006, was mainly due to ber 2006 and of three mortgage affiliates in the first quarter
$38.3 million in incremental depreciation and amortization of 2007.
expense related to our acquisition of TALX. The remainder For additional information about the charges and fees
of the increase is primarily due to higher depreciation related to our business realignment, see Note 10 of the
expense related to increased capital expenditures in 2007, Notes to the Consolidated Financial Statements in this
including the purchase of our data center facility in Atlanta, Annual Report.
Georgia in July 2007, and higher intangible amortization
Operating Income and Operating Margin
Operating Income and
Operating Margin Twelve Months Ended December 31, Change
2008 vs. 2007 2007 vs. 2006
(Dollars in millions) 2008 2007 2006 $ % $ %
Consolidated operating revenue $ 1,935.7 $ 1,843.0 $ 1,546.3 $ 92.7 5% $ 296.7 19%
Consolidated operating expenses (1,458.5) (1,356.8) (1,110.2) (101.7) 8% (246.6) 22%
Consolidated operating income $ 477.2 $ 486.2 $ 436.1 $ (9.0) (2)% $ 50.1 11%
Consolidated operating margin 24.7% 26.4% 28.2% (1.7) pts (1.8) pts
The decline in the operating margin for 2008, as compared The 2007 decline in operating margin, as compared to
to 2007, mainly reflects higher acquisition-related amortiza- 2006, was primarily due to a decline in the margins of our
tion expense, which increased $20.9 million primarily due USCIS business unit and the impact of acquisition-related
to our acquisition of TALX; the increase in general corpo- amortization expense from our acquisition of TALX. This
rate expense, which includes the $16.8 million restructuring amortization expense represented 2% of 2007 consolidated
and asset write-down charges related to our business revenue.
realignment recorded in the third quarter of 2008; and the
decrease in operating margin for our USCIS business, as
described in more detail below.
Other Expense, Net
Other Expense, Net Twelve Months Ended December 31, Change
2008 vs. 2007 2007 vs. 2006
(Dollars in millions) 2008 2007 2006 $ % $ %
Consolidated interest expense $ 71.3 $ 58.5 $ 31.9 $ 12.8 22% $ 26.6 83%
Consolidated minority interests in
earnings, net of tax 6.2 6.1 4.5 0.1 2% 1.6 36%
Consolidated other income, net (6.2) (3.0) (16.2) (3.2) 106% 13.2 (81)%
Consolidated other expense, net $ 71.3 $ 61.6 $ 20.2 $ 9.7 16% $ 41.4 205%
Annual average cost of debt 5.3% 6.1% 5.7%
Total consolidated debt, net $ 1,219.3 $ 1,387.3 $ 503.9 $ (168.0) (12)% $ 883.4 175%
The increases in other expense, net, for 2008 and 2007 as Other income, net, in 2008 includes a $5.5 million gain on
compared to the prior periods, were primarily due to our repurchase of $20 million principal amount of ten-year
increased interest expense driven by a higher level of debt senior notes due 2017. The decrease in other income, net,
which was used to fund the acquisition of TALX in 2007 in 2007 over 2006 was primarily due to the $14.1 million
and our share repurchase activity in both years. For addi- non-taxable gain recognized during 2006 in connection
tional information about our debt agreements, see Note 4 with our Naviant litigation settlement.
of the Notes to the Consolidated Financial Statements in
this Annual Report.
2008 ANNUAL REPORT 15