Slide 1: 2Q24 Earnings Review
2Q24 Earnings Review July 18, 2024
Slide 2: Forward-looking Statements
Forward-looking Statements This presentation contains certain forward-looking information, including third quarter and full year 2024 guidance, to help you understand Equifax and its business environment. All statements that address operating performance and events or developments that we expect or
Slide 3: Non-GAAP Disclosure Statement
Non-GAAP Disclosure Statement This presentation contains certain non-GAAP financial measures, including adjusted EPS and adjusted EBITDA, which reflect adjustments for certain items that affect the comparability of our underlying operational performance. Adjusted EPS is defined as net income adjusted fo
Slide 4: Strategic Priorities
Revenue at high end of 2Q Framework and Adjusted EPS above the range… Strong 13% non-mortgage C$ revenue growth led by EWS Govt up 30% Revenue $1.430B up 9% / 8% Organic C$ and Adj EPS $1.82 up 6%… EBITDA STRATEGIC PRIORITIES margins of 32%… Non-mortgage C$ revenue up 13% US Mortgage revenue up 4%..
Slide 5: Strong 20% EWS Non-mortgage Verifier revenue growth
Strong 20% EWS Non-mortgage Verifier revenue growth... Government up very strong 30%... Talent Solutions up 13% EWS Revenue Strong 2Q24 Non-Mtg Verifier $2,316M $583M $577M $560M $603M $613M Verifier revenue +9% total Flat -4% +3% +10% +1% +5% ✓ Non-mortgage +20% total ● Government +30% ● Talent +13% ●
Slide 6: Strong 30% EWS Government growth with big room for growth in $5B TAM
Strong 30% EWS Government growth with big room for growth in $5B TAM Gov’t Benefits Enrollment¹ EWS Government Revenue TANF Housing 1M Key Growth Areas 5M SSA 12M ✓ CMS contract extension $5B ($1.2B) SNAP TAM 23M ✓ SNAP expansion CAGR 50%+ ✓ State and local penetration CMS / ACA 38M ✓ Records growth
Slide 7: Strong 12% TWN active record growth in 2Q
Strong 12% TWN active record growth in 2Q Total US Records ~225M Unique Individuals ✓ TWN active records up 12% to 180M… total ~50M - 70M records up 10% to 695M 1099 / Pension Individuals ✓ 3.4 million companies contribute records to TWN ✓ Added 4 new strategic partners in 2Q 180M Active +12% ✓ Gig
Slide 8: USIS up 7%... Mortgage revenue up 27%
USIS up 7%... Mortgage revenue up 27% from very strong 40 point mortgage market outperformance USIS Revenue $1,658M $1,720M $426M $428M $465M $478M USIS revenue up 7% -7% +4% +7% +5% +10% +7% ✓ Mortgage +27%, inquiries -13% ✓ Consumer Solutions +13% ✓ Non-mortgage +1% Non-mtg +5% +8% +7% +3% +1% +1%
Slide 9: Strong 28% INTL growth led by Latam and Europe
Strong 28% INTL growth led by Latam and Europe Constant Currency Revenue Growth 28% Key Growth Areas ✓ Bolt-on M&A to strengthen portfolio… Boa Vista (Brazil) ✓ NPI accelerating across INTL BVS platforms… LatAm ✓ EFX Cloud-enabled innovation ✓ Differentiated data and insights ✓ Global platforms in lo
Slide 10: Strong 12.5% NPI Vitality Index in 2Q
Strong 12.5% NPI Vitality Index in 2Q… Over 30 NPIs in Second Quarter New Product Vitality Index1 % New Models Built Using AI / ML Key Areas 80% ✓ Strong 12.5% VI… broad 10% LT based across all regions LT Goal ✓ FY24 VI 10%+ Goal ✓ EWS VI 17%... up 700 bps sequentially ✓ USIS VI accelerating… 8% in
Slide 11: 2Q USIS Mortgage credit inquiries in line with April framework
2Q USIS Mortgage credit inquiries in line with April framework Mortgage Market Credit Inquiries EFX 2024 Guidance Assumption YoY Growth 2015-2019 Average Level of Inquiries Number of Inquiries 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Full year 15% 12% (-6%) (-8%) 6.5% 47% (-7.5%) (-37%) (-3
Slide 12: 3Q24 Guidance
3Q24 Guidance 3Q 2024 $ vs 3Q 2023 % vs 3Q 2023 Revenue1 $1,425M - $1,445M $106M - $126M 8.0% - 9.5%1 Adjusted EPS1 $1.75 - $1.85 / share ($0.01) - $0.09 / share (0.5%) - 5.2% Revenue Adj. EBITDA Business Units Growth Rate Margins (YTY) Guidance Specifics Workforce Solutions ~8.0% ~51.5% Depreciation
Slide 13: 2024 Guidance
2024 Guidance 2024 $ vs 2023 % vs 2023 Revenue1 $5,690M - $5,750M $425M - $485M 8.1% - 9.2%1 Adjusted EPS1 $7.22- $7.47 / share $0.51 -$0.76 / share 7.6% - 11.3% Revenue Adj. EBITDA Business Units Growth Rate Margins (YTY) Guidance Specifics Workforce Solutions ~7% ~52% Depreciation and amortization
Slide 14: $1B+ Revenue Upside in 2025+ from Mortgage Market Return to Normal
$1B+ Revenue Upside in 2025+ from Mortgage Market Return to Normal EFX Mortgage Credit Inquiries Down ~(-50%) EFX Mortgage Revenue ~$2.2B ~$1.1B 2025+ Opportunity ~$1.1B ~50% 2015 - 2019 Inquiry Level ~$1.1B mortgage revenue upside as market returns to 2015-19 levels PROPRIETARY | 14
Slide 15: Continued Strong Performance... 13% C$ Non-Mortgage Growth in 2Q
Continued Strong Performance… 13% C$ Non-Mortgage Growth in 2Q 2Q Revenue at top end of range and Adj EPS above top end of range… Non-mortgage C$ up 13%... Adj EBITDA margins 32.0% in line with guidance Strong 20% EWS Verifier Non-mortgage revenue growth… signed 4 new strategic New partners… reached
Slide 16: PROPRIETARY | 16
PROPRIETARY | 16
Slide 17: Trevor Burns, Investor Relations
Trevor Burns • Investor Relations • trevor.burns@equifax.com Copyright © 2024, Equifax Inc. All Rights Reserved. Equifax is a registered trademark of Equifax Inc.
Slide 18: Investor Relations July 2024
Investor Relations July 2024
Slide 19: Index
Index Pages The New EFX 20-33 Workforce Solutions Overview 34-38 Supplemental Financial Information 39-50 PROPRIETARY | 19
Slide 20: The New EFX
The New EFX PROPRIETARY | 20
Slide 21: The New Equifax... we are just getting started
The New Equifax… we are just getting started EFX Revenue Growth The New EFX Yesterday Today Technology Legacy Cloud-native Data Siloed Single Data Fabric New EFX Innovation Process-driven AI / ML NPI Sales-centric Product-centric EWS #2 BU Largest business M&A Opportunistic Accelerated Security Comp
Slide 22: EFX Long Term Framework
EFX Long Term Framework Long Term Financial Framework New EFX Organic revenue growth 7-10% LTFF Revenue Growth M&A contribution 1-2% EWS USIS INTL Total growth 8-12% 13-15% 6-8% 7-9% EBITDA% margin improvement +50 bps Cash EPS growth 12-16% Dividend yield ~1% Annual shareholder return 13-18% Faster
Slide 23: The EFX Cloud
The EFX Cloud PROPRIETARY | 23
Slide 24: Proprietary data, EFX Cloud... driving innovation
EFX accelerating AI capabilities… industry leading proprietary data, EFX Cloud… driving innovation Proven Results US Proprietary Data Assets % of New Models Built Using AI / ML 180M Active Records, ✓ EFX Cloud w/ Single Data 695M Total Records Fabric… Google Vertex, Ignite ✓ Leader in explainable AI
Slide 25: A Robust Foundation for Comprehensive Solutions
A Robust Foundation for Comprehensive Solutions Insights are Created Through Connected and Differentiated Data Consumer Telco, Cable Employment Consumer Education & Credit & Utility & Income Consented Credentials Traditional Unique Direct from Information Degree, & Specialty National Data Employers O
Slide 26: Broadening Our Global Presence in Important Growth Markets
Broadening Our Global Presence in Important Growth Markets CANADA UNITED KINGDOM UNITED STATES IBERIA INDIA Key Revenue Drivers Consumer Credit Brazil Commercial Credit LATAM Employment & Income AUSTRALIA NEW ZEALAND Identity & Fraud Analytics Collections PROPRIETARY | 26
Slide 27: A Strong Portfolio of Businesses
A Strong Portfolio of Businesses 2023 Business Mix 2023 Vertical Mix Other 3% 2023 Revenue Growth 2023 Adjusted Resellers 3% ID&F (Constant $) EBITDA Margin 6% Healthcare 2% International +12% 26.5% Financial 19% Corporate US Telco 2% (Employers) Information +4% 34.5% 15% Commercial 5% Solutions Con
Slide 28: Workforce Solutions (WS)
Workforce Solutions (WS) Accelerating growth through The Work Number expansion, advanced analytical solutions, and vertical expertise across direct and indirect channels 2023 Revenue Mix - $2,316M Focus Areas Data HUB Innovation Acquisitions Other 1% • Grow active TWN • Grow adoption and • Augment E
Slide 29: EWS Long Term Growth Framework
EWS Long Term Growth Framework Organic Revenue Growth % LTFF Growth Drivers Employer ● The Work Number® record growth thru Verifier New EFX Services direct clients, strong partnerships and 2% 13-15% alternative data 4% ● Growth in new verticals: Talent, 9-11% Government 3% 4% ● Robust set of growth l
Slide 30: US Information Solutions (USIS)
US Information Solutions (USIS) Strengthen our foundation of assets and capabilities while investing in solutions and adjacencies that accelerate sustainable growth in existing and new markets Focus Areas 2023 Revenue Mix - $1,720M Identity & Fraud Core Markets Other 5% • Fuel growth from Kount & •
Slide 31: USIS Long Term Growth Framework
USIS Long Term Growth Framework Organic Revenue Growth % LTFF Growth Drivers New EFX ● Enable the digital client experience: ● “Say Yes More” and frictionless, 2-3% 6-8% personalized experiences 5-7% ● Be the leader in Identity solutions ~2% ● New product innovation enabled by ~1% differentiated data
Slide 32: International (INTL)
International (INTL) Address customer needs through unique data assets to drive insights delivered via strategic technology platforms complemented by M&A for geographic and domain expansion 2023 Revenue Mix - $1,229M Focus Areas Data & Insights Consumer Focus AreasB2B Commercial B2B Other 6% ● Drivi
Slide 33: INTL Long Term Growth Framework
INTL Long Term Growth Framework Organic1 Revenue Growth % LTFF Growth Drivers New EFX ● EFX Cloud-enabled innovation 8-10% 7-9% ● Differentiated data and insights 1.0-1.5% 1.5-2.0% ● NPI acceleration across INTL platforms 2.5-3.0% Regions ● Global platforms in local markets range between ● Bolt-on M&
Slide 34: Workforce Solutions Overview
Workforce Solutions Overview PROPRIETARY | 34
Slide 35: Unique Dual-sided Business Model Driving Growth
Unique Dual-sided Business Model Driving Growth Supply Networks Dual-sided Business Model Demand Networks 695M TWN Employer Verification 500M+ records services Insights services TWN and 3.4M inquiries Record analytics contributors Alliance partners Employment System-to-System 45% Records via direct c
Slide 36: Multiple Drivers for EWS Revenue Growth
Multiple Drivers for EWS Revenue Growth Number of Contributors (Thousands) 2024 Growth Drivers +0.6M increase 2Q24 vs. 2Q23 ● TWN Record Growth ● Penetration, more pulls ● New Products / Use cases Number of Records +19M increase (Millions) 2Q24 vs. 2Q23 ● Data Hub Expansion 132M Unique SSNs ● M&A In
Slide 37: ~$13B EWS Growth Opportunity
~$13B EWS Growth Opportunity TAM ($B) Market Share % EWS Revenue Opportunity EFX Other Players / Manual / Lack of Adoption $15B Talent Sol $5B 10% 90% ~$2B Empl. Svcs 16% 84% Government $5B 15% 85% ~$13B 20% 80% ~$11B Verification Employer $2B Housing1 $1.5B 40% 60% $2.3B Cons. Fin.2 $1.5B 15% 85% To
Slide 38: EWS Non-Mortgage Products and Trends
EWS Non-Mortgage Products and Trends 2Q24: $182M; +30% 2Q24: $128M; +13% 2Q24: $97M; -11% Government Talent Solutions Employer Services Increase CMS penetration, expand Drive utilization and leverage new Grow adoption of I-9 & Federal and State contracts products based on industry needs Onboarding p
Slide 39: Supplemental Financial Information
Supplemental Financial Information PROPRIETARY | 39
Slide 40: Expanding TAM and Broadening Revenue Base
Expanding TAM and Broadening Revenue Base EFX TAM Up 3x +$1.8B Non-Mtg Rev Since 2019 $50B ~$5.7B Brazil $5.3B US – Empl. Svcs /HR $5.1B US - Govt US - Talent ~$4.6B $3.5B $4.3B Mtg ID&F $3.9B $2.8B Non-mtg Traditional Credit Bureau Note: This slide contains forward-looking information, including 20
Slide 41: 2Q 2024 Equifax Results
2Q 2024 Equifax Results Dollars in millions (except per share amounts) 2Q24 2Q23 Reported Revenue $1,430.5 $1,317.6 Growth % 8.6% Flat Local Currency Revenue $1,462.7 $1,333.1 Growth % 11.0% 1.2% GAAP Net Income $163.9 $138.3 Growth % 18.5% (31.1%) Adjusted EBITDA Margin 32.0% 32.7% Growth % -70 bps
Slide 42: 2Q 2024 Business Unit Performance
2Q 2024 Business Unit Performance Reported Local Currency Adj. EBITDA Margin Adj. EBITDA Margin Revenue Growth Revenue Growth Growth / (Decline) Workforce Solutions 5.2% 5.2% 52.8% 130 bps Verification Services 8.8% 8.8% N/A N/A Employer Services (10.8%) (10.8%) N/A N/A USIS 7.5% 7.5% 33.2% (280 bps)
Slide 43: 2Q 2024 International Highlights
2Q 2024 International Highlights Geographic Region Financial Performance Commentary Revenue: $339M, +28% International Adj. EBITDA: $87M, 25.6% B2B Consumer: 0% Asia Pacific Revenue: $85M, (2%) B2B Commercial: (6%) European Credit Reporting Business: +6% B2B Consumer: 0% Europe Revenue: $88M, +12% D
Slide 44: FY 2023 Equifax Results
FY 2023 Equifax Results Dollars in millions (except per share amounts) FY 2023 FY 2022 Reported Revenue $5,265.2 $5,122.2 Growth % 2.8% 4.0% Local Currency Revenue $5,316.4 $5,217.0 Growth % 3.8% 6.0% GAAP Net Income $545.3 $696.2 Growth % -21.7% -6.4% Adjusted EBITDA Margin 32.2% 33.6% Growth % -14
Slide 45: FY 2023 Business Unit Performance
FY 2023 Business Unit Performance Reported Local Currency Adj. EBITDA Margin Adj. EBITDA Margin Revenue Growth Revenue Growth Growth / (Decline) Workforce Solutions (0.4%) (0.4%) 51.0% (35 bps) Verification Services (1.3%) (1.3%) N/A N/A Employer Services 3.3% 3.3% N/A N/A USIS 3.8% 3.8% 34.5% (230 b
Slide 46: 2Q2024 General Corporate Expense, Capex, D&A, Interest
2Q2024 - General Corporate Expense, Capital Spending, D&A, Interest Expense and Other Income and Expense, excluding non-recurring costs General Corporate Expense (Including D&A)* – 2Q24 Capital Expenditures (incurred) in 2Q24 were $131M, down from $150M in $128M in 2Q24, as compared to $119M in 2Q23
Slide 47: Q3 & FY24 Guidance Corporate Expense, Capex, D&A, Interest
Q3 & FY24 Guidance - General Corporate Expense, Capital Spending, D&A, Interest Expense and Other Income and Expense, excluding non-recurring costs General Corporate Expense* – 3Q24 Capital Expenditures (incurred) in 3Q24 are expected to be ~$125M, down Expected to be ~$128M in 3Q24 compared to 3Q23
Slide 48: 2022-2024 Effective Income Tax Rate
2022-2024 Effective Income Tax Rate The effective tax rate used in calculating our GAAP and Adjusted EPS is as follows: GAAP EPS Adjusted EPS 1Q 2023 25.4% 26.1% 2Q 2023 27.4% 27.0% 3Q 2023 13.9% 26.0% 4Q 2023 26.4% 26.0% FY 2023 23.2% 26.2% 1Q 2024 24.3% 26.8% 2Q 2024 26.4% 26.5% 3Q 2024 Estimate ~28
Slide 49: Cash Flow and Other Metrics
Cash Flow and Other Metrics Dollars in millions 2Q24 2Q23 FY 2023 FY 2022¹ Operating Cash Flow $267.5 $262.1 $1,116.8 $757.1 Capital Expenditures (Cash) ($136.7) ($163.0) ($601.3) ($624.5) Free Cash Flow $130.8 $99.1 $517.5 $132.6 Cash Capex as a % Revenue 9.6% 12.4% 11.4% 12.2% Depreciation Expense
Slide 50: Strong balance sheet and liquidity
Strong balance sheet and liquidity June 30, 2024 Cash $181.9M Available Borrowing Capacity¹ $1,499.6M Total Liquidity $1,681.5M Leverage Ratio for 2Q24² 2.99x Credit Ratings BBB (S&P) / Baa2 (Moody’s) Next debt maturity: 2.60% $750M Sr Notes Due 12/1/2024 1. $1.5 billion Revolver 2. Covenant complia
Slide 51: Trevor Burns, Investor Relations
Trevor Burns • Investor Relations • trevor.burns@equifax.com Copyright © 2023, Equifax Inc. All Rights Reserved. Equifax is a registered trademark of Equifax Inc.