Equifax 2011 Annual Report Download - page 22

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TALX Workforce Solutions
TALX Workforce Solutions Twelve Months Ended December 31, Change
2011 vs. 2010 2010 vs. 2009
(Dollars in millions) 2011 2010 2009 $ % $ %
Operating Revenue:
Verfication Services $192.5 $183.4 $134.6 $ 9.1 5% $48.8 36%
Employer Services 211.8 212.2 211.8 (0.4) 0% 0.4 0%
Total operating revenue $404.3 $395.6 $346.4 $ 8.7 2% $49.2 14%
% of consolidated revenue 21% 21% 20%
Total operating income $ 90.7 $ 92.1 $ 75.4 $(1.4) -2% $16.7 22%
Operating margin 22.4% 23.3% 21.8% -0.9 pts 1.5 pts
Verification Services. Revenue from Verification Services increased
in 2011, compared to the prior year period, as high single digit
percentage revenue growth in verifications provided to non-mortgage
customers and the benefit of our third quarter 2011 acquisition of
DataVision Resources were partially offset by high single digit
declines in verification revenue from mortgage customers due to
reduced mortgage activity. Revenue increased in 2010 compared to
2009 due to mid-double digit growth from traditional employment
based verification, with strong demand across each of the mortgage,
pre-employment screening, social services and collections sectors;
and due to the impact of our acquisition of Rapid Reporting Verifica-
tion Company in the fourth quarter of 2009.
Employer Services. Revenue for 2011 as compared to 2010 slightly
decreased. Declines in our talent recruitment and management
services business due to decreased government hiring activity at the
U.S. Transportation Security Administration and reduced licensing
revenue were offset by revenue growth in our complementary
services business. The slight increase in revenue during 2010, as
compared to the prior year, resulted from growth in our
complementary services and as well as growth in our talent recruit-
ment and management services business due to increased
government hiring activity at the U.S. Transportation and Security
Administration and other large government customers. This was
partially offset by expected declines in our Tax Management Services
business driven primarily by decreases in unemployment compensa-
tion claims activity.
TALX Workforce Solutions Operating Margin. Operating margin for
2011, when compared to the prior year period, decreased due to
revenue and associated margin declines in government-based tax
transcript verification services and talent recruitment and manage-
ment services as a result of a slowdown in mortgage-related activity
and decreased license revenue, respectively. There was also
increased acquisition-related amortization associated with our two
acquisitions in the latter half of 2011. Operating margin increased in
2010, as compared to 2009, due to continued revenue growth, while
operating expenses grew at a slower rate due to the leveraging of
certain fixed operational and overhead costs and certain operating
process efficiencies for both periods.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS continued
EQUIFAX 2011 ANNUAL REPORT
20