Equifax 2009 Annual Report Download - page 23

operating margin decline in 2009, as compared to the prior year, revenue. Although revenue increased year over year, revenue growth
was primarily due to the revenue decline discussed above, as well during the first nine months of 2008 was partially offset by a 3%
as increased advertising expenses, as the Company introduced a decline in fourth quarter revenue due to lower breach, partner and
2009 television advertising program in order to increase direct sub- transaction-based revenue caused in part by the weakness in the
scription sales. U.S. economy. Total subscription customers were 1.2 million at
December 31, 2008. The increase in operating margin in 2008 is
mainly due to continued subscription-based revenue growth and
For 2008, as compared to 2007, revenue increased primarily due to
reduced operating expenses driven by reduced customer support
higher subscription revenue associated with our 3-in-1 Monitoring,
costs, when compared to 2007.
ScoreWatch, CreditWatch, ID Patrol and Credit Report Control prod-
ucts, partially offset by declines in transaction revenue and breach
North America Commercial Solutions
North America Commercial Solutions Twelve Months Ended December 31, Change
2009 vs. 2008 2008 vs. 2007
(Dollars in millions) 2009 2008 2007 $ % $ %
Total operating revenue $69.8 $ 71.5 $ 67.6 $ (1.7) (2)% $ 3.9 6%
% of consolidated revenue 4% 4% 3%
Total operating income $ 15.1 $ 13.6 $ 12.0 $ 1.5 11% $ 1.6 13%
Operating margin 21.7% 19.0% 17.7% 2.7 pts 1.3 pts
Revenue declined for 2009, as compared to the prior year, due to For 2008, as compared to 2007, revenue increased mainly due to
the unfavorable impact of changes in the U.S. — Canadian foreign higher sales volume for products in our U.S. Commercial business,
exchange rate of $1.7 million, or 2%. In local currency, 2009 reve- as well as $0.3 million, or 1%, of favorable foreign currency impact.
nue was flat when compared to 2008. Revenue declines in the U.S. Although revenue increased year over year, revenue grew at low
and Canadian risk and marketing service revenues attributed to double digit rates during the first half of the year, but was essentially
weakness in the U.S. and Canadian economies were offset by flat with the prior year in local currency due to increasing weakness
increased revenue from our data management products. Online in the U.S. and Canadian economies in the second half of the year.
transaction volume for U.S. commercial credit information products Online transaction volume for U.S. commercial credit information
decreased 21% for 2009, as compared to the prior year, due to a products increased to 4.9 million during 2008, up 4% from 2007.
slowdown in loan origination to small businesses. Operating margin For 2008, as compared to 2007, operating margin increased pri-
increased for 2009, as compared to 2008, mainly due to reduced marily due to revenue growth in our U.S. Commercial business par-
operating expenses resulting from lower personnel costs and discre- tially offset by increased personnel and software costs as we contin-
tionary expenses. ued to invest for growth.
General Corporate Expense
General Corporate Expense Twelve Months Ended December 31, Change
2009 vs. 2008 2008 vs. 2007
(Dollars in millions) 2009 2008 2007 $ % $ %
General corporate expense $ 121.3 $ 122.8 $ 113.7 $ (1.5) (1)% $ 9.1 8%
Our general corporate expenses are costs that are incurred at the General corporate expenses for 2008, as compared to 2007,
corporate level and include those expenses impacted by corporate increased primarily as a result of a $16.8 million restructuring and
direction, such as shared services, administrative, legal, equity com- asset write-down charge during 2008, which consisted of a
pensation costs and restructuring expenses. General corporate $10.3 million charge related to headcount reductions, a $4.1 million
expenses decreased slightly for 2009, as compared to 2008, pri- charge associated with certain contractual costs and a $2.4 million
marily as a result of reduced incentive costs, lower legal and profes- software write-down charge, all related to our business realignment.
sional fees and reduced occupancy costs. This was partially offset This increase was partially offset by reduced incentive costs, litiga-
by $8.0 million of additional restructuring charges recorded during tion and payroll tax.
2009, as well as increased insurance costs. Total 2009 restructuring
charges of $24.8 million related primarily to headcount reductions.
EQUIFAX 2009 ANNUAL REPORT 21
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