Equifax 2011 Annual Report Download - page 20

Segment Financial Results
U.S. Consumer Information Solutions
U.S. Consumer Information Solutions Twelve Months Ended December 31, Change
2011 vs. 2010 2010 vs. 2009
(Dollars in millions) 2011 2010 2009 $ % $ %
Operating revenue:
Online Consumer Information Solutions $519.8 $485.2 $501.4 $34.6 7% $(16.2) -3%
Mortgage Solutions 119.5 113.5 99.5 6.0 5% 14.0 14%
Consumer Financial Marketing Services 153.3 144.3 111.3 9.0 6% 33.0 30%
Total operating revenue $792.6 $743.0 $712.2 $49.6 7% $ 30.8 4%
% of consolidated revenue 40% 40% 41%
Total operating income $287.3 $269.8 $259.4 $17.5 6% $ 10.4 4%
Operating margin 36.2% 36.3% 36.4% -0.1 pts -0.1 pts
U.S. Consumer Information Solutions revenue increased 7% in 2011
as compared to 2010 as a result of growth across all of our USCIS
business lines. The increase in revenue for 2010, as compared to
2009, was due to growth in Mortgage Solutions along with growth
due to our acquisition of IXI Corporation in the fourth quarter of 2009
partially offset by a small decline in online credit reporting revenue.
OCIS. The increase in revenue for 2011, as compared to 2010, was
driven by increased market volume, particularly in the credit card and
auto markets; new customer wins; new service introductions; and
select pricing actions in subscription and wholesale arrangements. An
11% increase in core credit decision transaction volumes was
partially offset by lower average price per transaction for our transac-
tion based revenue. Revenue for 2010, as compared to 2009,
declined primarily due to a reduction of online credit decision transac-
tion volume of 5% caused by weakness in the U.S. consumer credit
markets while pricing remained relatively flat year over year.
Mortgage Solutions. Revenue has increased in 2011 primarily due
to increased sales of settlement services as a result of increased
market share from existing customers partially offset by the declines
in core mortgage reporting services due to lower refinancing activity
as compared to the comparable periods of 2010. Revenue for 2010
increased, as compared to the prior year, due to favorable long-term
interest rates that resulted in higher consumer refinancing activity and
increased home sales activity attributable to U.S. government incen-
tives for housing purchases which expired on May 31, 2010.
Consumer Financial Marketing Services. 2011 revenue increased,
as compared to 2010, due to continued growth in credit-based pre-
screen and portfolio management revenue as well as strong market
penetration of wealth-based consumer information services. The
increase in revenue in 2010, as compared to 2009, was primarily due
to our acquisition of IXI Corporation during the fourth quarter of 2009.
U.S. Consumer Information Solutions Operating Margin. In 2011,
improved margins in online credit services and CFMS resulting from
solid revenue growth were offset by lower margins in mortgage solu-
tions due to less favorable product mix and by expense investment
and increased acquisition-related amortization associated with our
fourth quarter 2010 acquisition of Anakam.
Operating margin remained relatively consistent in 2010, as
compared to 2009. The margin impact of amortization expense
associated with the IXI acquisition was offset by expense leveraging
resulting from revenue growth and expense reductions due to certain
process streamlining activities.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS continued
EQUIFAX 2011 ANNUAL REPORT
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