Equifax 2010 Annual Report Download - page 17

Selling, general and administrative expenses from continuing opera-
tions for 2009 decreased $20.4 million when compared to 2008. Of
this decline, $12.7 million resulted from foreign currency translation.
The remaining decrease was primarily due to reduced legal
expenses, lower technology and occupancy costs and reduced
personnel and incentive costs due to the 2008 and 2009 headcount
reductions, partially offset by a $10.4 million increase in restructuring
charges in 2009, increased advertising and insurance costs and
higher postretirement employee benefits cost.
Depreciation and Amortization. Depreciation and amortization
expense from continuing operations in 2010 increased $17.0 million
as compared to 2009 primarily due to our fourth quarter 2009
acquisitions which contributed $9.0 million of incremental deprecia-
tion and amortization expense, as well as the effect of recent
investments in new products and technology infrastructure.
Depreciation and amortization expense from continuing operations
increased $3.0 million in 2009 over 2008. Excluding the positive
foreign currency translation impact of $2.6 million, depreciation and
amortization expense increased $5.6 million over the prior year. The
increase is primarily due to our fourth quarter 2009 acquisitions of
IXI Corporation and Rapid Reporting Verification Company which
contributed $1.8 million of incremental depreciation and amortization
expense and the inclusion of a full year of depreciation and amortiza-
tion expense for our 2008 acquisitions, partially offset by the absence
of a $2.4 million software write-down charge recognized in 2008.
For additional information about our restructuring charges, see
Note 11 of the Notes to the Consolidated Financial Statements in this
report.
Operating Income and Operating Margin
Operating Income and
Operating Margin Twelve Months Ended December 31, Change
2010 vs. 2009 2009 vs. 2008
(Dollars in millions) 2010 2009 2008 $ % $ %
Consolidated operating revenue $ 1,859.5 $ 1,716.0 $ 1,813.6 $143.5 8% $(97.6) -5%
Consolidated operating expenses (1,429.5) (1,334.2) (1,374.6) (95.3) 7% 40.4 -3%
Consolidated operating income $ 430.0 $ 381.8 $ 439.0 $ 48.2 13% $(57.2) -13%
Consolidated operating margin 23.1% 22.2% 24.2% 0.9 pts -2.0 pts
The increase in operating income from continuing operations and
operating margin for 2010, as compared to 2009, is primarily
attributed to the 8% increase in revenue and $24.8 million of
restructuring charges in 2009 that did not recur in 2010.
The decline in operating margin for 2009, as compared to 2008, was
primarily due to lower operating income in our USCIS, International
and North America Personal Solutions segments and $8.0 million of
additional restructuring charges in 2009, partially offset by growth in
our TALX operating income. The operating income declines for the
aforementioned segments are attributed to reductions in revenue
resulting from global economic weakness, partially offset by lower
operating expenses due to headcount reductions, reduced incentive
costs and lower technology outsourcing costs.
Other Expense, Net
Other Expense, Net Twelve Months Ended December 31, Change
2010 vs. 2009 2009 vs. 2008
(Dollars in millions) 2010 2009 2008 $ % $ %
Consolidated interest expense $ 56.1 $ 57.0 $ 71.3 $ (0.9) -2% $(14.3) -20%
Consolidated other income, net (1.3) (6.2) (6.2) 4.9 -79% — 0%
Consolidated other expense, net $ 54.8 $ 50.8 $ 65.1 $ 4.0 8% $(14.3) -22%
Average cost of debt 5.2% 4.8% 5.3%
Total consolidated debt, net, at year end $999.6 $1,174.1 $1,219.3 $(174.5) -15% $(45.2) -4%
The increase in other expense, net, from continuing operations for
2010, as compared to 2009, was primarily due to a decline in other
income, net. Other income, net, for 2009 included a $2.2 million
mark-to-market adjustment on certain insurance policies, a $1.1 mil-
lion gain on our repurchase of $7.5 million principal amount of our
ten-year senior notes due 2017 and a $1.3 million gain related to a
litigation settlement. Interest expense decreased slightly for 2010,
when compared to 2009, as a decrease in our average debt balance
from $1.18 billion to $1.07 billion more than offset an increase in the
average interest rate on our total debt from 4.8% in 2009 to 5.2% in
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