Slide 1: Fourth Quarter 2023 Earnings
Fourth Quarter 2023 Earnings Chris Cartwright, President and CEO Todd Cello, CFO February 13, 2024
Slide 2: Forward-Looking Statements Non-GAAP Financial Information
Forward-Looking Statements Non-GAAP Financial Information This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of This investor presentation includes certain non-GAAP 1995. These statements are based on the current beliefs and expec
Slide 3: Agenda
1 Fourth quarter 2023 highlights 2 2024 strategic priorities Fourth quarter 2023 3 financial results First quarter and 4 full-year 2024 guidance @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 3
Slide 4: Fourth quarter 2023 highlights
Fourth quarter 2023 highlights Revenue, Adjusted Organic constant 11th straight Launched Prepaid $25M in EBITDA and currency revenue quarter of programs to debt for total of Adjusted Diluted +5% with growth double-digit optimize operating $250M in 2023 EPS exceeded across all International model and
Slide 5: 2024 Strategic Priorities
Accelerate revenue and earnings 1 growth Leverage Neustar’s capabilities 2024 Strategic Priorities 2 further 3 Execute transformation initiatives @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 5
Slide 6: Anticipate stable to improving market conditions in 2024
Accelerate revenue and earnings growth Anticipate stable to improving market conditions in 2024 Economic growth U.S. consumers Inflation Credit standards India growth likely to remain maintain strength moderating with remain tight due to remains strong; muted throughout due to high interest rate cut
Slide 7: Expect stronger 2024 results in low growth but more stable macro environment
Accelerate revenue and earnings growth Expect stronger 2024 results in low growth but more stable macro environment Revenue Adjusted EBITDA Adjusted Diluted EPS +3% to +5% +4% to +7% +6% to +11% • Stable economic conditions with • Revenue flow-through • Adjusted EBITDA flow- steady, albeit slower le
Slide 8: Neustar expected to grow mid-single digit in 2024
Leverage Neustar capabilities further Neustar expected to grow mid-single digit in 2024 Organic Revenue Growth Scale Trusted Call Solutions 14% +Mid-Single • Grew revenues by ~60% in 2023 to $80M; expect ~40% 8% Digit growth in 2024 6% +Mid-single 5% Digit • Add new capabilities in the U.S. – brande
Slide 9: Implementing next phase of transformation to reduce costs and accelerate innovation
Execute transformation initiatives Implementing next phase of transformation to reduce costs and accelerate innovation Programs Expected Benefits Optimize operating model ~ $200M free cash flow benefit by 2026 • Expand Global Capability Center (GCC) network and • $120-140M of operating expense s
Slide 10: Integrating credit, fraud and marketing strengths will fuel growth across all three markets
Execute transformation initiatives Integrating credit, fraud and marketing strengths will fuel growth across all three markets Why we’re focused here: Large, growing markets with attractive economics Complement and enhance our leading core credit position Clear right to win and lead through differen
Slide 11: OneTru integrates and activates data and analytic assets
Execute transformation initiatives OneTru integrates and activates data and analytic assets to power innovation and efficiency • Improve data quality, innovation and time to market • Drive operational efficiency – Rationalize applications and infrastructure – Standardize global services and capabili
Slide 12: OneTru already powers next generation of global products
Execute transformation initiatives OneTru already powers next generation of global products TruIQ (Analytics) TruValidate (Fraud) TruAudience (Marketing) • Innovation Labs – Improve • Combine TransUnion and Neustar • Launched next generation of customer collaboration and enable identity data and adv
Slide 13: Consolidated fourth quarter 2023 highlights
Consolidated fourth quarter 2023 highlights Reported Y/Y ($M) Change Revenue $954 6% • Organic constant currency revenue Organic Constant Currency Revenue 5% growth of +5%, or Adjusted EBITDA $326 1% +4% excluding mortgage Adjusted EBITDA Margin 34.2% (140)bps Adjusted Diluted EPS $0.80 2% For addit
Slide 14: U.S. Markets fourth quarter 2023 highlights
U.S. Markets fourth quarter 2023 highlights • U.S. Markets organic revenue growth (ex-mortgage) flat Organic Reported Reported FX Inorganic Constant • U.S. Financial Services organic ($M) Y/Y Impact Impact Currency revenue (ex-mortgage) -2% − Auto +1% Revenue $608 3% – – 3% − Card -5% and Consumer L
Slide 15: Consumer Interactive fourth quarter 2023 highlights
Consumer Interactive fourth quarter 2023 highlights • Declined -2% excluding large Organic breach win Reported Reported FX Inorganic Constant ($M) Y/Y Impact Impact • Indirect growth led by Sontiq Currency (Sontiq grew 20%+ in 2023) • Direct channel declined as Revenue $150 7% – – 7% expected • Adju
Slide 16: International fourth quarter 2023 highlights
International fourth quarter 2023 highlights Organic Reported Reported Inorganic ($M) Y/Y FX Impact Impact Constant • India (+30%) driven by Currency consumer, commercial, Revenue $215 14% (2)% – 13% marketing, fraud and direct-to- Canada 36 14% 0% – 14% consumer • Canada (+14%) new business Latin A
Slide 17: Excess cash targeted for debt prepayment
Excess cash targeted for debt prepayment Leverage Ratio1 • Roughly $5.3 billion of debt and $480 million cash at 4.3x 4.1x year-end 3.9x 3.8x 3.5x 3.5x 3.6x Low-3x • $250M of debt prepayment in 3.4x 3.1x 3.1x Range <3.0x 2023 • ~$8M of annual interest expense savings from refinancings completed in O
Slide 18: First quarter 2024 guidance
First quarter 2024 guidance Reported Revenue: $971M to $980M +3% to +4% Assumed M&A contribution: No impact Revenue Assumed FX contribution: Insignificant Assumes similar lending and Organic Constant Currency Revenue: +3% to +4% marketing trends to Q4 2023 Assumed mortgage impact: ~1pt. benefit Orga
Slide 19: Full-year 2024 revenue guidance
Full-year 2024 revenue guidance Reported Revenue: $3.960B to $4.020B +3% to +5% Assumed M&A contribution: No impact Assumed FX contribution: Insignificant Market Assumptions Organic Constant Currency Revenue: +3% to +5% • Assumes slower conditions persist; upside if interest rate Assumed mortgage im
Slide 20: Full-year 2024 Adjusted EBITDA, Adjusted Diluted EPS and other guidance
Full-year 2024 Adjusted EBITDA, Adjusted Diluted EPS and other guidance Adjusted EBITDA: $1.398B to $1.441B +4% to +7% • Expected one-time costs Assumed FX contribution: Insignificant related to transformation program to total ~$200M in Adjusted EBITDA margin: 35.3% to 35.8% 2024 Adjusted EBITDA mar
Slide 21: Bridge to 2024 Adjusted EBITDA guidance
Bridge to 2024 Adjusted EBITDA guidance $20M - $25M ~($55M) ~$65M ~$65M $1,441M $1,344M 2023 Adjusted Revenue flow-through Transformation Neustar acquisition Reset of incentive 2024F Adjusted EBITDA less investments savings synergies and compensation to target, EBITDA (High-End) (primarily growth-or
Slide 22: Exceeded Q4 guidance; 2024 outlook and priorities
Exceeded Q4 guidance Expecting in 2024 to 2024 priorities: for revenue, Adjusted deliver +3% to +5% accelerating growth, EBITDA and Adjusted organic constant leverage Neustar Diluted EPS currency revenue capabilities further and growth and +6% to executing transformation +11% Adjusted Diluted initia
Slide 23: Q&A
Q&A @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 23
Slide 24: Appendices and Non-GAAP Reconciliations
Appendices and Non-GAAP Reconciliations @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 24
Slide 25: Debt Profile and 2024F Interest Expense Bridge
Debt Profile and 2024F Interest Expense Bridge Debt Profile (12/31/23) 2024F Interest Expense Bridge Notional Expiry Rate ($B) ~($7M) Term Loan Tranche ~($8M) Term Loan A-3 1.3 Oct’28 SOFR + CSA + 1.50% $267M ~($7M) Term Loan B-5 2.2 Nov’26 SOFR + CSA + 1.75% Term Loan B-6 1.9 Dec’28 SOFR + 2.00%* S
Slide 26: Adjusted EBITDA and Adjusted EBITDA Margin
Adjusted EBITDA and Adjusted EBITDA Margin @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 26
Slide 27: Adjusted Net Income and Adjusted Diluted EPS
Adjusted Net Income and Adjusted Diluted EPS @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 27
Slide 28: Adjusted Effective Tax Rate
Adjusted Effective Tax Rate @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 28
Slide 29: Leverage Ratio
Leverage Ratio @ Copyright 2024 TransUnion, its subsidiaries and/or affiliates. All Rights Reserved. 29
Slide 30: Non-GAAP Adjustment Footnotes
Non-GAAP Adjustment Footnotes As a result of displaying amounts in millions, rounding differences may exist in the tables and footnotes. 1. Consists of restructuring expenses of $71.9 million related to employee separation costs and $3.4 million related to non-cash facility lease impairments, as wel
Slide 31: Non-GAAP Adjustment Footnotes
Non-GAAP Adjustment Footnotes 5. Consolidated Adjusted EBITDA margin is calculated by dividing Consolidated Adjusted EBITDA by total revenue. 6. Diluted share counts for Adjusted Diluted Earnings Per Share includes an additional $1.3 million of dilutive securities for the twelve months ended Decembe
Slide 32: Adjusted EBITDA and Adjusted EPS Guidance
Adjusted EBITDA and Adjusted EPS Guidance As a result of displaying amounts in millions, rounding differences may exist in the table. 1. These adjustments include the same adjustments we make to our Adjusted EBITDA and Adjusted Net Income as discussed in the Non-GAAP Financial Measures section of ou