efx-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


(Mark One)
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 001-06605

EQUIFAX INC.

(Exact name of registrant as specified in its charter)


Georgia			58-0401110
(State or other jurisdiction of			(I.R.S. Employer
incorporation or organization)			Identification No.)

1550 Peachtree Street

N.W.

Atlanta

Georgia

30309

(Address of principal executive offices)

(Zip Code)

404-885-8000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common stock, $1.25 par value per share

EFX

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

☒

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

On April 5, 2024, there were 123,611,310 shares of the registrant’s common stock outstanding.

EQUIFAX INC.

QUARTERLY REPORT ON FORM 10-Q

QUARTER ENDED MARCH 31, 2024

INDEX


		Page
PART I.	Financial Information	4
Item 1.	Financial Statements (Unaudited)	4
	Consolidated Statements of Income—Three Months Ended March 31, 2024 and 20 23	4

	Consolidated Statements of Comprehensive Income (Loss)—Three Months Ended March 31, 2024 and 2023	5

	Consolidated Balance Sheets—March 31, 2024 and December 31, 2023	6
	Consolidated Statements of Cash Flows—Three Months Ended March 31, 2024 and 2023	7


	Consolidated Statements of Shareholders' Equity and Accumulated Other Comprehensive Loss—Three Months Ended March 31, 2024 and 2023	8
	Notes to Consolidated Financial Statements (Unaudited)	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30
Item 4.	Controls and Procedures	30
PART II.	Other Information	31
Item 1.	Legal Proceedings	31
Item 1A.	Risk Factors	31
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
Item 5	Other Information	33
Item 6.	Exhibits	34
Signatures		35

FORWARD-LOOKING STATEMENTS

This report contains information that may constitute “forward-looking statements.” Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will,” “may” and similar expressions identify forward-looking statements, which generally are not historical in nature. All statements that address future operating performance and events or developments that we expect or anticipate will occur in the future, including statements relating to future operating results, improvements in our information technology and data security infrastructure, including as a part of our cloud data and technology transformation, our strategy, the expected financial and operational benefits, synergies and growth from our acquisitions, changes in U.S. and worldwide economic conditions, such as changes in interest rates and inflation, that materially impact consumer spending, home prices, investment values, consumer debt, unemployment rates and the demand for Equifax's products and services, our culture, our ability to innovate, the market acceptance of new products and services and similar statements about our business plans are forward-looking statements. Management believes that these forward-looking statements are reasonable as and when made. However, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the Company’s historical experience and our present expectations or projections, including without limitation our expectations regarding the Company’s outlook, long-term organic and inorganic growth, and customer acceptance of our business solutions referenced below under “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation — Business Overview.” These risks and uncertainties include, but are not limited to, those described in Part II, “Item 1A. Risk Factors” and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2023, and those described from time to time in our future reports filed with the United States Securities and Exchange Commission (“SEC”). As a result of such risks and uncertainties, we urge you not to place undue reliance on any such forward-looking statements. Forward-looking statements speak only as of the date when made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

EQUIFAX INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)


	Three Months Ended March 31,
	2024		2023
(In millions, except per share amounts)
Operating revenue	$	1,389.4	$	1,302.0
Operating expenses:
Cost of services (exclusive of depreciation and amortization below)	627.7		580.4
Selling, general and administrative expenses	372.6		366.1
Depreciation and amortization	164.4		150.1
Total operating expenses	1,164.7		1,096.6
Operating income	224.7		205.4
Interest expense	(59.7)		(57.6)
Other income, net	1.6		4.4
Consolidated income before income taxes	166.6		152.2
Provision for income taxes	(40.5)		(38.7)


Consolidated net income	126.1		113.5
Less: Net income attributable to noncontrolling interests including redeemable noncontrolling interests	(1.2)		(1.1)

Net income attributable to Equifax	$	124.9	$	112.4




Basic earnings per common share:


Net income attributable to Equifax	$	1.01	$	0.92
Weighted-average shares used in computing basic earnings per share	123.5		122.6
Diluted earnings per common share:


Net income attributable to Equifax	$	1.00	$	0.91
Weighted-average shares used in computing diluted earnings per share	124.8		123.5
Dividends per common share	$	0.39	$	0.39

See Notes to Consolidated Financial Statements.

EQUIFAX INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)


	Three Months Ended March 31,
	2024				2023
	Equifax Shareholders		Noncontrolling Interests including Redeemable Noncontrolling Interests		Total		Equifax Shareholders		Noncontrolling Interests including Redeemable Noncontrolling Interests		Total
	(In millions)
Net income	$	124.9	$	1.2	$	126.1	$	112.4	$	1.1	$	113.5
Other comprehensive income (loss):
Foreign currency translation adjustment	(95.4)		(3.5)		(98.9)		12.6		0.3		12.9

Change in cumulative gain from cash flow hedging transactions, net	0.1		—		0.1		—		—		—
Comprehensive income (loss)	$	29.6	$	(2.3)	$	27.3	$	125.0	$	1.4	$	126.4

See Notes to Consolidated Financial Statements.

EQUIFAX INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)


(In millions, except par values)	March 31, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	201.0	$	216.8
Trade accounts receivable, net of allowance for doubtful accounts of $16.4 and $16.7 at March 31, 2024 and December 31, 2023, respectively	1,006.1		908.2
Prepaid expenses	170.7		142.5
Other current assets	71.7		88.8
Total current assets	1,449.5		1,356.3
Property and equipment:
Capitalized internal-use software and system costs	2,596.0		2,541.0
Data processing equipment and furniture	248.4		247.9
Land, buildings and improvements	282.5		272.9
Total property and equipment	3,126.9		3,061.8
Less accumulated depreciation and amortization	(1,276.7)		(1,227.8)
Total property and equipment, net	1,850.2		1,834.0
Goodwill	6,761.3		6,829.9
Indefinite-lived intangible assets	94.8		94.8
Purchased intangible assets, net	1,773.5		1,858.8
Other assets, net	322.0		306.2
Total assets	$	12,251.3	$	12,280.0
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt and current maturities of long-term debt	$	880.0	$	963.4
Accounts payable	198.1		197.6
Accrued expenses	306.2		245.1
Accrued salaries and bonuses	113.5		168.7
Deferred revenue	113.2		109.5
Other current liabilities	362.8		334.7
Total current liabilities	1,973.8		2,019.0
Long-term debt	4,745.3		4,747.8
Deferred income tax liabilities, net	454.1		474.9
Long-term pension and other postretirement benefit liabilities	97.7		100.1
Other long-term liabilities	268.2		250.7
Total liabilities	7,539.1		7,592.5
Commitments and Contingencies (see Note 6)

Redeemable noncontrolling interests	131.6		135.1
Equifax shareholders' equity:
Preferred stock, $0.01 par value: Authorized shares - 10.0; Issued shares - none	—		—
Common stock, $1.25 par value: Authorized shares - 300.0; Issued shares - 189.3 at March 31, 2024 and December 31, 2023; Outstanding shares - 123.6 and 123.3 at March 31, 2024 and December 31, 2023, respectively	236.6		236.6
Paid-in capital	1,824.7		1,761.3
Retained earnings	5,685.0		5,608.6
Accumulated other comprehensive loss	(526.5)		(431.2)
Treasury stock, at cost, 65.1 shares and 65.4 shares at March 31, 2024 and December 31, 2023, respectively	(2,652.4)		(2,635.3)
Stock held by employee benefits trusts, at cost, 0.6 shares at March 31, 2024 and December 31, 2023	(5.9)		(5.9)

Total Equifax shareholders’ equity	4,561.5		4,534.1
Noncontrolling interests	19.1		18.3
Total shareholders' equity	4,580.6		4,552.4
Total liabilities, redeemable noncontrolling interests, and shareholders' equity	$	12,251.3	$	12,280.0

See Notes to Consolidated Financial Statements.

EQUIFAX INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Three Months Ended March 31,
	2024		2023
	(In millions)
Operating activities:
Consolidated net income	$	126.1	$	113.5
Adjustments to reconcile consolidated net income to net cash provided by operating activities:

Depreciation and amortization	166.6		152.2
Stock-based compensation expense	41.2		39.7

Deferred income taxes	(17.9)		(11.9)
Gain on fair market value adjustment of equity investments	—		(3.1)

Changes in assets and liabilities, excluding effects of acquisitions:
Accounts receivable, net	(102.5)		(60.8)
Other assets, current and long-term	(15.2)		(25.0)
Current and long term liabilities, excluding debt	54.4		(53.7)
Cash provided by operating activities	252.7		150.9
Investing activities:
Capital expenditures	(131.9)		(158.3)
Acquisitions, net of cash acquired	—		(4.3)



Cash used in investing activities	(131.9)		(162.6)
Financing activities:
Net short-term payments	(83.4)		(160.8)
Payments on long-term debt	(4.4)		—
Borrowings on long-term debt	—		175.0

Dividends paid to Equifax shareholders	(48.2)		(47.9)
Distributions paid to noncontrolling interests	(0.4)		—
Proceeds from exercise of stock options and employee stock purchase plan	19.9		6.6
Payment of taxes related to settlement of equity awards	(15.4)		(15.9)


Debt issuance costs	—		(0.3)


Cash used in financing activities	(131.9)		(43.3)
Effect of foreign currency exchange rates on cash and cash equivalents	(4.7)		2.3
Decrease in cash and cash equivalents	(15.8)		(52.7)
Cash and cash equivalents, beginning of period	216.8		285.2
Cash and cash equivalents, end of period	$	201.0	$	232.5

See Notes to Consolidated Financial Statements.

EQUIFAX INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY AND ACCUMULATED OTHER COMPREHENSIVE LOSS

(Unaudited)

For the Three Months Ended March 31, 2024


	Equifax Shareholders
								Accumulated Other Comprehensive Loss				Stock Held By Employee Benefits Trusts				Total Shareholders' Equity
	Common Stock
	Shares Outstanding	Amount		Paid-In Capital		Retained Earnings				Treasury Stock				Noncontrolling Interests
	(In millions, except per share amounts)
Balance, December 31, 2023	123.3	$	236.6	$	1,761.3	$	5,608.6	$	(431.2)	$	(2,635.3)	$	(5.9)	$	18.3

SEC Form 10-Q filed by Equifax Inc.