Slide 1: TransUnion Second Quarter 2020 Earnings
v v v TransUnion Second Quarter 2020 Earnings Chris Cartwright, President and CEO Todd Cello, CFO
Slide 2: Forward-Looking Statement and Non-GAAP Financial Information
Forward-Looking Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of TransUnion’s management and are subject to significant risks and uncertain
Slide 3: Focus on welfare of associates, customers and communities
• Focus on the welfare of our associates, customers, consumers and communities • Continue to work from home globally • Appreciate the selfless and tireless work of healthcare professionals, first responders and other essential workers • Embrace the opportunity to foster greater diversity and inclusi
Slide 4: Second quarter 2020 overview, business trends, strategic investments
1 Second quarter 2020 overview 2 Current business trends 3 Strategic long-term investments 4 Detailed financial performance 5 Scenario-based outlook © 2020 Trans Union LLC All Rights Reserved | 4
Slide 5: Second Quarter 2020 Overview
Second Quarter 2020 Overview Delivered revenue, Adjusted EBITDA and Adjusted Diluted EPS solidly in our upside case scenario Benefitted as our associates, customers and consumers transitioned to a work from home and socially distanced reality Experienced generally positive trends since April; re-ope
Slide 6: U.S. Markets – Financial Services Trend
U.S. Markets – Financial Services Trend Online Credit Report Unit Volumes Total U.S. Markets Financial Services Volume Additional trend data since Q1 2020 Earnings Release +5% January February March April May June July(1) 2019 2020 © 2020 Trans Union LLC All Rights Reserved | 6 (1) Volume growth/dec
Slide 7: U.S. Markets – Financial Services End-Market Trends
U.S. Markets – Financial Services End-Market Trends Online Credit Report Unit Volumes Mortgage Auto Additional trend data since Q1 Additional trend data since Q1 2020 Earnings Release 2020 Earnings Release +64% (1%) (1) (1) January February March April May June July January February March April May
Slide 8: Healthcare Vertical Trends
Healthcare Vertical Trends Our solutions reduce provider risk and increase cash flow • Front-end solutions: insurance eligibility checks, identity screens and payment estimation ─ Sharp volume declines early in Q2 as patients and providers delayed or cancelled elective and preventive care ─ Partiall
Slide 9: Insurance Vertical Trends
Insurance Vertical Trends Provide insurers with marketing and underwriting solutions, analytics and investigative tools for claims • Delivered low-single-digit revenue decline as insurers: ─ Improved digital experience for consumers ─ Recognized an increased need for fraud mitigation tools ─ Focused
Slide 10: Other U.S. Markets Vertical Trends
Other U.S. Markets Vertical Trends Vertical What We Do Current Trends TransUnion Outlook Background screening Public Government agencies largely Expect continued and fraud mitigation Sector continue to operate unabated strong performance solutions Volume declines due to Critical data for Expect indu
Slide 11: Consumer Interactive Trends
Consumer Interactive Trends Consumers recognize value of credit and identity protection, credit monitoring and related financial education tools • Direct channel: ─ Good performance behind continued successful marketing to consumers focused on their credit health • Indirect channel: ─ Indirect partn
Slide 12: International Year-to-Date Trends
International Year-to-Date Trends Year-over-Year Constant Currency Adj. Revenue Growth / (Decline) Canada [Q2: (2)%] 0% India [Q2: (23)%] Latin America [Q2: (22)%] Africa [Q2: (21)%] Asia Pacific [Q2: (12)%] U.K. [Q2: (16)%] Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Note: Q2 adjusted revenue perform
Slide 13: International Trends
International Trends Country or Revenue Portfolio Diversification Current Trends Region Contribution (Beyond Financial Services) 7% of Total TU Fraud solutions, government, Markets under stress; U.K. (31% of International) gaming, affordability suite strong fraud solution volumes 4% of Total TU Frau
Slide 14: Global Solutions Will Improve Our Ability to Develop and Diffuse Innovation
Global Solutions Will Improve Our Ability to Aggressively and Strategically Develop and Diffuse Innovation Globally • Built a series of solution-focused teams populated with talented associates with deep product and market knowledge • Hired global fraud leader and quickly standardized three of four
Slide 15: Global Operations Allows Us to Expand Our Core Capabilities
Global Operations Allows Us to Expand Our Core Capabilities, Enhancing the Customer Experience and Driving Greater Efficiencies • Global Procurement: leverage and build on existing spend discipline while creating consistent global standards • Global Capability Centers (GCC): replicate success of fir
Slide 16: Project Rise Is Our Accelerated Technology Initiative
Project Rise is Our Accelerated Technology Initiative to Ensure that We Are Even More Effective, Efficient, Secure, Reliable, and Performant • Identified a series of critical, global applications that will be deployed in early 2021 with others to follow • Streamlining and rationalizing our applicati
Slide 17: Consolidated Q2 2020 Highlights
Year-over-Year Change Adjusted Revenue (4)% Constant Currency Adjusted Revenue (3)% Consolidated Organic Adjusted Revenue (5)% Q2 2020 Organic Constant Currency Adjusted Revenue (3)% Highlights Adjusted EBITDA (8)% Constant Currency Adjusted EBITDA (7)% Organic Constant Currency Adjusted EBITDA (7)%
Slide 18: U.S. Markets Q2 2020 Year-over-Year
Inorganic Organic Constant Reported FX Impact Impact Currency U.S. Markets Adjusted (0)% — — (0)% Q2 2020 Revenue Financial Year-over-Year Services 4% — — 4% Financial Emerging (5)% — (0)% (6)% Verticals Highlights Adjusted (2)% — — (2)% EBITDA Note: Rows may not foot due to rounding. For additional
Slide 19: International Q2 2020 Year-over-Year
Organic Organic CC Inorganic Reported FX Impact Constant ex. Recipero Impact Currency Disposition Adjusted (22)% +6% — (16)% (15)% International Revenue Q2 2020 Canada (5)% +3% — (2)% — Latin Year-over-Year America (34)% +13% — (22)% — Financial U.K. (19)% +3% — (16)% (13)% Highlights Africa (36)% +
Slide 20: Consumer Interactive Q2 2020
Consumer Inorganic Organic Constant Reported FX Impact Interactive Impact Currency Q2 2020 Adjusted Revenue 4% — — 4% Year-over-Year Adjusted Financial 4% — — 4% EBITDA Highlights Note: For additional information, refer to the “Non-GAAP Financial Information” section on slide 2. © 2020 Trans Union L
Slide 21: Strong Liquidity Position and Commitment to Prudently Manage our Balance Sheet
Strong Liquidity Position and Commitment to Prudently Manage our Balance Sheet Liquidity Leverage $432M Cash on hand $3.20B Total net debt $300M Undrawn revolver capacity $1.06B TTM Adjusted EBITDA $732M Total liquidity 3.0x Reported net leverage ratio • Significant cash build in Q2, resulting in •
Slide 22: Suspending Full Year 2020 Guidance
• Given the ongoing and considerable uncertainty about the impact of COVID-19 across all our geographic and Suspending vertical markets, we continue to believe that it is prudent to suspend full year 2020 guidance. Full Year 2020 Guidance • We will continue to assess this decision, and intend to rei
Slide 23: Third Quarter 2020 Scenario-based Outlook
Third Quarter 2020 Scenario-based Outlook Market Potential Balance Sheet Assumptions Financial Outcome Implications • Adjusted Revenue: decline 0% to 5% ─ Includes 1 point of FX headwind ─ U.S. Markets: flat to low-single-digits percent growth • Cash builds assuming no Current trends ─ International
Slide 24: Third Quarter 2020 Scenario-based Outlook
Third Quarter 2020 Scenario-based Outlook Market Potential Balance Sheet Assumptions Financial Outcome Implications • Adjusted Revenue: growth • Cash builds fairly significantly Meaningful Upside assuming no debt improvement in • Adjusted EBITDA: better than 6% decline and could grow prepayment or M
Slide 25: Full Year 2020 Outlook – Other Items
Prior Outlook Updated Outlook (provided with Q4 2019 earnings) Adj. Tax Rate: 25.5%(1) Adj. Tax Rate: 23% – 25% Full Year Total D&A: ~$375M Total D&A: ~$360M 2020 Outlook • D&A ex. step-up and • D&A ex. step-up and – Other Items subsequent M&A: ~$180M subsequent M&A: ~$170M Net Interest Exp.: ~$140M
Slide 26: Closing priorities: addressing the crisis and investing for growth
• Continuing to execute plans to proactively address and weather the current crisis environment • Investing to position TransUnion for continued best-in-class growth • Prioritizing welfare of associates and broader communities © 2020 Trans Union LLC All Rights Reserved | 26
Slide 27: Q&A
Q&A © 2020 Trans Union LLC All Rights Reserved | 27