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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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61-1678417
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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555 West Adams, Chicago, Illinois
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60661
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, par value $0.01 per share
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New York Stock Exchange
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x
YES
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o
NO
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o
YES
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x
NO
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x
YES
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o
NO
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x
YES
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o
NO
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¨
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x
Large accelerated filer
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¨
Accelerated filer
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Non-accelerated filer
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¨
Smaller reporting company
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Emerging growth company
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¨
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o
YES
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x
NO
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EXECUTIVE OFFICERS OF THE REGISTRANT
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ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
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ITEM 14. PRINCIPAL ACCOUNT
ING FEES AND SERVICES
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ITEM 16. FORM 10-K SUMMARY
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macroeconomic and industry trends and adverse developments in the debt, consumer credit and financial services markets;
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our ability to provide competitive services and prices;
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our ability to retain or renew existing agreements with large or long-term customers;
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our ability to maintain the security and integrity of our data;
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our ability to deliver services timely without interruption;
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our ability to maintain our access to data sources;
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government regulation and changes in the regulatory environment;
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litigation or regulatory proceedings;
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regulatory oversight of “critical activities”;
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our ability to effectively manage our costs;
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economic and political stability in the United States and international markets where we operate;
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our ability to effectively develop and maintain strategic alliances and joint ventures;
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our ability to timely develop new services and the market’s willingness to adopt our new services;
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our ability to manage and expand our operations and keep up with rapidly changing technologies;
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our ability to make acquisitions and successfully integrate the operations of acquired businesses and realize the intended benefits of such acquisitions;
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our ability to protect and enforce our intellectual property, trade secrets and other forms of unpatented intellectual property;
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our ability to defend our intellectual property from infringement claims by third parties;
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the ability of our outside service providers and key vendors to fulfill their obligations to us;
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further consolidation in our end-customer markets;
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the increased availability of free or inexpensive consumer information;
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losses against which we do not insure;
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our ability to make timely payments of principal and interest on our indebtedness;
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our ability to satisfy covenants in the agreements governing our indebtedness;
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our ability to maintain our liquidity;
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share repurchase plans; and
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our reliance on key management personnel.
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Investing in our Technology:
Technology is at the core of the solutions we provide to our customers. We have made significant investments to modernize our infrastructure and to transition to the latest big data and analytics technologies which enable us to be quicker, more efficient and more cost-effective. Our next-generation technology enhances our ability to organize and handle high volumes of disparate data, improves delivery speeds, provides better availability and strengthens product development capabilities, while lowering our overall cost structure and allowing us to maintain our focus on information security. Our investment strategy has been to build capabilities and leverage them across multiple geographies and industry verticals.
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Expanding our Data:
We have continued to invest in the breadth and depth of our data. We introduced the concept of trended data to provide the trajectory of a consumer’s risk profile, used public records data to enhance the scope of business issues we can address and incorporated alternative data into our databases to better assess risk for banked and unbanked consumers. We believe we are the largest provider of scale in the United States to possess both nationwide consumer credit data and comprehensive, diverse public records data. All of these initiatives improve the quality of our data, provide deeper insights into risk and allow us to create differentiated solutions for our customers.
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Strengthening our Analytics Capabilities:
We have strengthened our analytics capabilities by leveraging our next-generation technology and expanded data, utilizing more advanced tools and growing our analytics team. This has allowed us to create solutions that produce greater insights and more predictive results, which help our customers make better decisions. In addition, our strengthened analytics capabilities have shortened our time-to-market to create and deliver these solutions to our customers.
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Broadening our Target Markets:
We have grown our target markets by establishing a presence in attractive high-growth and strategic international markets such as the United Kingdom, India, Colombia and the Philippines, entering new verticals such as government and investigative services in the United States and expanding the reach of our consumer
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Enhancing our Business Processes and Capabilities:
We have enhanced our business processes and capabilities to support our growth. We have hired additional industry experts, which has allowed us to create and sell new vertical-specific solutions that address our customers’ needs. Our global sales force structure increases our sales team’s coverage of customers across our target markets.
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Rapid Growth in Data Creation and Application:
Larger and more diversified datasets are now assembled faster while the breadth of analytical applications and solutions has expanded. Companies are increasingly relying on business analytics and big data technologies to help process this data in a cost-efficient manner. In addition, non-traditional sources of structured and unstructured data have become important in deriving alternative metrics. The proliferation of smartphones and other mobile devices also generates enormous amounts of data tied to consumers, activities and locations. We believe that the demand for targeted data and sophisticated analytical solutions will continue to grow meaningfully as businesses seek real-time access to more granular views of consumer populations and more holistic views on individual consumers.
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Advances in Technology and Analytics Unlocking the Value of Data:
Ongoing advances in data collection, storage and analytics technology have contributed to the greater use and value of data and analytics in decision making. As businesses have gained the ability to rapidly aggregate and analyze data, they increasingly expect access to real-time data and analytics from their information providers as well as solutions that fully integrate into their workflows. We believe this has made sophisticated technology critical for gaining and retaining business in the risk and information services industry.
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Greater Adoption of Big Data Solutions Across New and Existing Industry Verticals:
With the proliferation of data, we believe companies across new and existing industry verticals recognize the value of risk information and analytical tools, particularly when tailored to their specific needs.
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Financial Services Industry:
The combination of increased regulatory capital, additional compliance costs and the overhang of legacy assets is pushing large segments of small-to-medium-sized business and consumer lending out of the banking sector, resulting in the creation of new specialty finance companies, such as peer-to-peer lending platforms and online balance sheet lenders, which are actively filling the void. These technology-enabled lending platforms provide access to credit in a fast and efficient manner by utilizing sophisticated risk assessment tools that leverage data, such as behavioral data, transactional data and employment and credit information. At the same time, traditional financial services companies are also increasing the use of applications and data in order to address regulatory requirements, lower operating costs and better serve their customers.
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Healthcare Industry:
Greater patient financial responsibility, focus on cost management and regulatory supervision are all driving healthcare providers to use data and related analytics tools to better manage their revenue cycle. For example, to reduce collection risks, healthcare providers seek information about their patients’ insurance coverage and ability to pay at the time of registration. In addition, insurance discovery tools are being utilized to optimize accounts receivable management, maximize collections and minimize uncompensated care.
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Insurance Industry:
As consumers increasingly obtain quotes from multiple insurers in an effort to lower their costs, insurers are trying to improve the accuracy of their risk assessments and initial quotes. For example, insurance carriers are using driver violation data to uncover offenses that will impact pricing earlier in the quoting process so consumers have a more accurate view of the premiums they will be charged.
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Increasing Lending Activity in Emerging International Markets:
As economies in emerging markets continue to develop and mature, we believe there will continue to be favorable socio-economic trends, such as an increase in the size of the middle class and a significant increase in the use of financial services by under-served and under-banked consumers. In addition, credit penetration is relatively low in emerging markets when compared to developed markets. For example, using our database of information compiled from financial institutions as a benchmark of credit activity, we estimate that
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Increased Management and Monitoring of Personal Financial Information and Identity Protection by Consumers:
Demand for consumer solutions is rising with greater consumer awareness of the importance and usage of their credit information, increased risk of identity theft due to data breaches and increasingly available free credit information. We estimate the number of consumer subscriptions to a credit monitoring or identity protection service has grown approximately 20% annually from 2015 through 2018. In addition, the proliferation of mobile devices has made data much more accessible, enabling consumers to manage their finances and monitor their information in real-time. We believe these trends will continue to drive growth for our consumer business.
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Powerful Big Data Capabilities:
Our technology gives us the ability to process, organize and analyze high volumes of data across multiple operating systems, databases and file types as well as to deal with both structured and unstructured data that changes frequently. We process billions of transactions on a daily basis.
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Enhanced Linking and Matching:
Because our data matching technology is able to interrelate data across disparate sources, industries and time periods, we believe that we are able to create differentiated datasets and provide our customers with comprehensive insights that allow them to better evaluate risk. For example, our
TLOxp
solution leverages these data matching capabilities across various datasets to identify and investigate relationships among people, assets, locations and businesses, allowing us to offer enhanced due diligence, threat assessment, identity authentication and fraud prevention and detection solutions.
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Greater Efficiency:
From ingestion of data to distribution of analytics and insights, our next-generation technology enables a faster time to market. For example, a portion of our platform now allows for data profiling, cleansing and ingestion of data significantly faster and can be done in a self-service approach by non-IT power users, allowing us to significantly reduce overall production times for new products.
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Advanced Platform Flexibility:
Our technology offers a high degree of flexibility, speed and customization of our solutions, via capabilities like graphical development and business rules environments, and allows easy integration with our customers’ workflows. We manage and control our technology instead of outsourcing it, which provides us with the flexibility to prioritize changes and to quickly implement any updates to our applications and solutions.
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Lower Operating Costs:
Our technology investments have lowered our overall cost to maintain and develop our systems, allowing us to redeploy significantly more resources to support revenue generating initiatives, such as vertical expansion and new product development.
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AdFuel
:
AdFuel
powers digital media campaigns with highly targeted audiences for the financial services and insurance industries. TransUnion
AdFuel
audiences are found across the online advertising ecosystem on the industry’s leading publishers and platforms. Our audiences leverage TransUnion data, delivering actionable data and insights to financial services and insurance companies and helping organizations identify new opportunities and assess risk.
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CreditView
:
CreditView
is an interactive dashboard that provides consumers with credit information and educational tools in a comprehensive, user-friendly format. Consumers are able to easily see how their credit profiles have changed over time, receive alerts on key credit changes, simulate the impact of financial decisions on their credit score, and see relevant offers for financial products.
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CreditVision
: We continue to enhance our credit data by including new data fields, enriching values in existing data fields and expanding account history. Our enhanced credit data has been combined with hundreds of algorithms to produce
CreditVision
and
CreditVision Link
M
, first to market and market-leading solutions that provide greater granularity and evaluate consumer behavior patterns over time. This results in a more predictive view of the consumer, increases the total population of consumers who can effectively be scored and helps consumers gain improved pricing.
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DecisionEdge
:
DecisionEdge
is a software-as-a-service decisioning offering which allows businesses to identify and authenticate customers, interpret data and predictive model results, and apply customer-specific criteria to facilitate real-time, automated decisions at the point of consumer interaction.
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DriverRisk:
Leveraging our driver violation database, we developed
DriverRisk
, a data and analytic solution that helps auto insurance carriers cost effectively validate driving records and assess risk during the underwriting and renewal process to improve returns.
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Insurance Coverage Discovery and Other Health Insurance
: For our healthcare customers, we offer insurance coverage discovery, coordination of benefits, and third party liability solutions, which enables the discovery of previously unidentified health insurance coverage to help both our provider and payer customers receive appropriate payment for uncompensated care and coordination of benefits payments. Our proprietary technology identifies patient accounts that qualify Disproportionate Share Hospitals (DSH), Medicare, TRICARE and commercial insurance benefits and monitors an account for up to three years for retroactive eligibility that providers may have missed.
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IDVision with iovation:
We have recently expanded the capabilities of
IDVision
with the acquisition of iovation, Inc. (“iovation”) in June 2018. iovation is one of the most advanced providers of device-based information in the world, with insight into nearly 5 billion unique devices. In October 2018 we announced the expansion of our
IDVision
product, which we now call
IDVision with iovation. IDVision with iovation
offers an enhanced suite of identity management, authentication and fraud prevention solutions that protect businesses from fraud while enabling great experiences for their online users. This results in a global network effect of fraud and risk insights that allow businesses to quickly and accurately determine good customers from fraudulent ones.
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Prama:
Prama Insights
provides customers with on-demand, 24/7 customer access to massive, depersonalized data sets and key analytics for portfolio understandings, benchmarking and peer analysis.
Prama Studio
offers an environment for customers to create, test and manage attributes that support model development to achieve growth, risk and compliance goals.
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SmartMove
:
SmartMove
allows independent landlords to screen applicants on a real-time basis by pushing the screening information of the individual renter to the landlord, based on the consent of the renter. The solution is delivered through our mobile channel and through our partners and provides independent landlords with convenient access to the same quality information provided to large property management firms.
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TLOxp
:
TLOxp
leverages our data matching capabilities across thousands of data sources to identify and investigate relationships among specific people, assets, locations and businesses. This allows us to offer enhanced due diligence, threat assessment, identity authentication and fraud prevention and detection solutions, and to expand our solutions into new verticals such as government and law enforcement.
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Comprehensive Data Assets:
Our credit database contains the name and address of substantially all of the U.S. credit-active population, a listing of their existing credit relationships and their timeliness in repaying debt obligations. The information in our database is voluntarily provided by thousands of credit-granting institutions and other data furnishers. We enhance our data assets with alternative credit sources such as rental payments and utility payments. We also actively source information from courts, government agencies and other public records including suits, liens, judgments, bankruptcies, professional licenses, real property, vehicle ownership, other assets, driver violations, criminal records and contact information. Our databases are updated, reviewed and monitored on a regular basis.
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Predictive Analytics:
Our predictive analytics capabilities allow us to analyze our proprietary datasets and provide insights to our customers to allow them to drive better business decisions. Our tools allow customers to investigate past behavior, reasonably predict the likelihood of future events and strategize actions based on those predictions. We have numerous tools such as predictive modeling and scoring, customer segmentation, benchmarking, forecasting, fraud modeling and campaign optimization, all of which cater to specific customer requirements. Our predictive analytics capabilities are developed by an analytics team with deep industry experience and a broad array of specialized qualifications.
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Fair Credit Reporting Act (the
“
FCRA
”
)
: FCRA applies to consumer credit reporting agencies, including us, as well as data furnishers and users of consumer reports. FCRA promotes the accuracy, fairness and privacy of information in the files of consumer reporting agencies that engage in the practice of assembling or evaluating information relating to consumers for certain specified purposes. FCRA limits what information may be reported by consumer reporting agencies, limits the distribution and use of consumer reports, establishes consumer rights to access and dispute their own credit files, requires consumer reporting agencies to make a free annual credit report available to consumers and imposes many other requirements on consumer reporting agencies, data furnishers and users of consumer report information. Violation of FCRA can result in civil and criminal penalties. The law contains an attorney fee shifting provision to provide an incentive to consumers to bring individual or class action lawsuits against a consumer reporting agency for violations of FCRA. Regulatory enforcement of FCRA is under the purview of the Federal Trade Commission (the “FTC”), the Consumer Financial Protection Bureau (the “CFPB”) and state attorneys general, acting alone or in concert with one another.
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State Fair Credit Reporting Acts
: Many states have enacted laws with requirements similar to FCRA. Some of these state laws impose additional, or more stringent, requirements than FCRA. FCRA preempts some of these state laws but the scope of preemption continues to be defined by the courts.
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The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”)
: A central purpose of the Dodd-Frank Act is to “protect consumers from abusive financial services practices, and for other purposes.” Title X of the Dodd-Frank Act created the CFPB. The CFPB, through rulemaking, confirmed that the Company is subject to the examination and supervision of the CFPB, and such examinations began in 2012. In addition to transferring authority under certain existing laws to the CFPB and providing it with examination and supervisory authority, the Dodd-Frank Act also prohibits unfair, deceptive or abusive acts or practices (“UDAAP”) with respect to consumer financial products and provides the CFPB with authority to enforce those provisions. The CFPB has stated that its UDAAP authority may allow it to find statutory violations even where a specific regulation does not prohibit the relevant conduct, or prior published regulatory guidance or judicial interpretation has found the activity to be in accordance with law.
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The Economic Growth, Regulatory Relief, and Consumer Protection Act (the “EGRRCPA”)
: In May 2018, Congress passed the EGRRCPA, which amended certain parts of the Dodd-Frank Act, FCRA and other U.S. federal laws applicable to us. Specifically, FCRA was amended to require that a credit reporting agency provide consumers with at least one year to submit a fraud alert to the credit reporting agency. The law also amended the FCRA for purposes of implementing a national security freeze that credit reporting agencies must provide free of charge upon formal request by a consumer. The credit freeze prevents credit reporting agencies from disclosing the content of a consumer report. Credit reporting agencies must also notify consumers of this right and provide instructions on how to implement and lift a credit freeze. The law increases veteran credit protection by implementing a process to remove inaccurate medical information and veteran medical debt and creates standards for verifying veteran medical debt. In addition, credit reporting agencies are required to provide free credit reporting monitoring, which requires notifying the consumer of any changes to his or her file, to any active duty military consumer.
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State unfair and deceptive practices acts and practices laws
: Many state have enacted statutes that prohibit unfair and deceptive acts and practices, relating to, among other things, marketing, disclosures and billing practices within the state or directed to consumers within the state. The Company and others in the industry may be subject to these laws with respect to the marketing of consumer credit information products.
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Gramm-Leach Bliley Act (the “GLBA”
): The GLBA regulates, among other things, the receipt, use and disclosure of non-public personal information of consumers that is held by financial institutions, including us. Several of our datasets are subject to GLBA provisions, including limitations on the use or disclosure of the underlying data and rules relating to the technological, physical and administrative safeguarding of non-public personal information. Violation of the GLBA can result in civil and criminal liability. Regulatory enforcement of the GLBA is under the purview of the FTC, the CFPB, the federal prudential banking regulators, the SEC and state attorneys general, acting alone or in concert with each other.
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Drivers’ Privacy Protection Act (the “DPPA”)
: The DPPA requires all states to safeguard certain personal information included in licensed drivers’ motor vehicle records from improper use or disclosure. Protected information includes the driver’s name, address, phone number, Social Security Number, driver identification number, photograph, height, weight, gender, age, certain medical or disability information and, in some states, fingerprints, but does not include information on vehicular accidents, driving violations and driver’s status. The DPPA limits the use of this information sourced from State departments of motor vehicles to certain specified purposes, and does not apply if a driver has consented to the
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Data security breach laws
: All states have adopted data security breach laws that may require notice be given to affected consumers in the event of a breach of personal information, and in some cases the provision of additional benefits such as free credit monitoring to affected individuals. Some of these laws require additional data protection measures over and above the GLBA data safeguarding requirements. If data within our system is compromised by a breach, we may be subject to provisions of various state security breach laws, including regulatory investigations or enforcement actions from state attorneys general, who enforce state data breach or unfair and deceptive practices laws.
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Identity theft laws
: Under the federal EGRRCPA, consumers can place a security freeze on their credit reports to prevent others from opening new accounts or obtaining new credit in their name and obtain one-year of fraud alerts free of charge. In addition, most states and the District of Columbia have passed laws that give consumers the right to place a security freeze on their credit report. Generally, these state laws require us to respond to requests for a freeze within a certain period of time, to send certain notices or confirmations to consumers in connection with a security freeze and to unfreeze files upon request within a specified time period.
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Federal Trade Commission Act (the “FTC Act”)
: The FTC Act prohibits unfair methods of competition and unfair or deceptive acts or practices. We must comply with the FTC Act when we market our services, such as consumer credit monitoring services through our Consumer Interactive segment. Our data collection, use and disclosure practices and the security measures we employ to safeguard the personal data of consumers could also be subject to the FTC Act, and our data practices or our failure to safeguard data adequately may subject us to regulatory scrutiny or enforcement action. There is no private right of action under the FTC Act.
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The Credit Repair Organizations Act (“CROA”)
: CROA regulates companies that claim to be able to assist consumers in improving their credit standing. Some courts have applied CROA to credit monitoring services offered by consumer reporting agencies and others. CROA allows for a private right of action and permits consumers to recover all money paid for alleged “credit repair” services in the event of violation. We, and others in our industry, have settled purported consumer class actions alleging violations of CROA without admitting or denying liability.
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The Health Insurance Portability and Accountability Act of 1996, as amended by the American Recovery and Reinvestment Act of 2009 (“HIPAA”) and the Health Information Technology for Economic and Clinical Health Act (“HITECH”)
: HIPAA and HITECH require companies to implement reasonable safeguards to prevent intentional or unintentional misuse or wrongful disclosure of protected health information. In connection with receiving data from and providing services to healthcare providers, we may handle data subject to HIPAA and HITECH requirements. We obtain protected health information from healthcare providers and payers of healthcare claims that are subject to the privacy, security and transactional requirements imposed by HIPAA. We are frequently required to secure HIPAA-compliant “business associate” agreements with the providers and payers who supply data to us. As a business associate, we are obligated to limit our use and disclosure of health-related data to certain statutorily permitted purposes, HIPAA regulations, as outlined in our business associate agreements, and to preserve the confidentiality, integrity and availability of this data. HIPAA and HITECH also require, in certain circumstances, the reporting of breaches of protected health information to affected individuals and to the United States Department of Health and Human Services. A violation of any of the terms of a business associate agreement or noncompliance with HIPAA or HITECH data privacy or security requirements could result in administrative enforcement action and/or imposition of statutory penalties by the United States Department of Health and Human Services or a state Attorney General. HIPAA and HITECH requirements supplement but do not preempt state laws regulating the use and disclosure of health-related information; state law remedies, which can include a private right of action, remain available to individuals affected by an impermissible use or disclosure of health-related data.
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United Kingdom:
Data Protection Act (the “DPA”) and the Privacy and Electronic Communications Regulation (the “PECR”) - The DPA is the key legislation that governs all credit reporting agency (“CRA”) activities and the PECR compliments it, setting out more specific privacy rights on electronic communications. PECR was most recently amended in 2016, limiting use cases of personal data for prospecting/origination purposes. The provision of credit referencing
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South Africa
: National Credit Act of 2005 (the “NCA”) - The NCA and its implementing regulations govern credit bureaus and consumer credit information. The NCA sets standards for filing, retaining and reporting consumer credit information. The NCA also defines consumers’ rights with respect to accessing their own information and addresses the process for disputing information in a credit file. The NCA is enforced by The National Credit Regulator who has authority to supervise and examine credit bureaus.
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Canada:
Personal Information Protection and Electronic Documents Act of 2000 (“PIPEDA”) - The PIPEDA and substantially similar provincial laws govern how private sector organizations collect, use and disclose personal information in the course of commercial activities. The PIPEDA gives individuals the right to access and request correction of their personal information collected by such organizations. The PIPEDA requires compliance with the Canadian Standard Association Model Code for the Protection of Personal Information. Most Canadian provinces also have laws dealing with consumer reporting. These laws typically impose an obligation on credit reporting agencies to have reasonable processes in place to maintain the accuracy of the information, place limits on the disclosure of the information and give consumers the right to have access to, and challenge the accuracy of, the information.
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India:
Credit Information Companies Regulation Act of 2005 (“CICRA”) - The CICRA requires entities that collect and maintain personal credit information to ensure that it is complete, accurate and protected. Entities must adopt certain privacy principles in relation to collecting, processing, preserving, sharing and using credit information. In addition, India has privacy legislation that would allow individuals to sue for damages in the case of a data breach, if the entity negligently failed to implement “reasonable security practices and procedures” to protect personal data.
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Hong Kong:
Personal Data (Privacy) Ordinance (“PDPO”) and The Code of Practice on Consumer Credit Data (“COPCCD”) - The PDPO and the COPCCD regulate the operation of consumer credit reference agencies. They prescribe the methods and security controls under which credit providers and credit reference agencies may collect, access and manage credit data. In April 2011, the COPCCD was amended to permit credit providers to share limited positive mortgage payment data. In June 2012, the PDPO was amended to increase penalties and create criminal liabilities for repeat contravention of PDPO under which enforcement notices have been served.
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Colombia:
The Colombian Financial Data Protection Regime (Law 1266 of 2008) regulates the collection, use and transfer of personal data pertaining to financial services, including credit reporting. The Colombian General Data Protection Regime (Law 1581 of 2012 and Decree 1377 of 2013) covers regulation of all other personal data. Both of these regimes have applicability to credit reporting services in Colombia and together address obligations of information furnishers, database owners, consumer right of access, consumer consent and permitted information disclosures. Regulatory enforcement primarily rests with the Financial Superintendence of Colombia and the Colombia Data Protection Authority (Superintendence of Industry and Commerce).
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make it difficult for us to satisfy our financial obligations, including with respect to our indebtedness;
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limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions or other general business purposes;
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limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general business purposes;
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require us to use a substantial portion of our cash flow from operations to make debt service payments;
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expose us to the risk of increased interest rates as certain of our borrowings, including Trans Union LLC’s senior secured credit facility, are at variable rates of interest;
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limit our ability to pay dividends;
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limit our flexibility to plan for, or react to, changes in our business and industry;
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place us at a competitive disadvantage compared with our less-leveraged competitors; and
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increase our vulnerability to the impact of adverse economic and industry conditions.
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obtain unauthorized access to confidential consumer information;
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manipulate or destroy data; or
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disrupt, sabotage or degrade service on our systems.
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the techniques used in cyberattacks change frequently and may not be recognized until after the attacks have succeeded;
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cyberattacks can originate from a wide variety of sources, including sophisticated threat actors involved in organized crime, sponsored by nation-states, or linked to terrorist or hacktivist organizations; and
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third parties may seek to gain access to our systems either directly or using equipment or security passwords belonging to employees, customers, third-party service providers or other users.
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the breadth and complexity of our operations and the high volume of transactions that we process;
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the large number of customers, counterparties and third-party service providers with which we do business;
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the proliferation and increasing sophistication of cyberattacks; and
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the possibility that a third party, after establishing a foothold on an internal network without being detected, might obtain access to other networks and systems.
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amendment, enactment or interpretation of laws and regulations that restrict the access and use of personal information and reduce the availability or effectiveness of our solutions or the supply of data available to customers;
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changes in cultural and consumer attitudes in favor of further restrictions on information collection and sharing, which may lead to regulations that prevent full utilization of our solutions;
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failure of data suppliers or customers to comply with laws or regulations, where mutual compliance is required;
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failure of our solutions to comply with current laws and regulations; and
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failure of our solutions to adapt to changes in the regulatory environment in an efficient, cost-effective manner.
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currency exchange rate fluctuations;
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foreign exchange controls that might prevent us from repatriating cash to the United States;
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difficulties in managing and staffing international offices;
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•
|
increased travel, infrastructure, legal and compliance costs of multiple international locations;
|
•
|
foreign laws and regulatory requirements;
|
•
|
terrorist activity, natural disasters and other catastrophic events;
|
•
|
restrictions on the import and export of technologies;
|
•
|
difficulties in enforcing contracts and collecting accounts receivable;
|
•
|
longer payment cycles;
|
•
|
failure to meet quality standards for outsourced work;
|
•
|
unfavorable tax rules;
|
•
|
political and economic conditions in foreign countries, particularly in emerging markets;
|
•
|
the presence and acceptance of varying level of business corruption in international markets;
|
•
|
varying business practices in foreign countries; and
|
•
|
reduced protection for intellectual property rights.
|
•
|
internally develop and implement new and competitive technologies;
|
•
|
use leading third-party technologies effectively;
|
•
|
respond to changing customer needs and regulatory requirements, including being able to bring our new products to the market quickly; and
|
•
|
transition customers and data sources successfully to new interfaces or other technologies.
|
•
|
failing to achieve the financial and strategic goals for the acquired business;
|
•
|
paying more than fair market value for an acquired company or assets;
|
•
|
failing to integrate the operations and personnel of the acquired businesses in an efficient and timely manner;
|
•
|
disrupting our ongoing businesses;
|
•
|
distracting management focus from our existing businesses;
|
•
|
acquiring unanticipated liabilities;
|
•
|
failing to retain key personnel;
|
•
|
incurring the expense of an impairment of assets due to the failure to realize expected benefits;
|
•
|
damaging relationships with employees, customers or strategic partners;
|
•
|
diluting the share value of existing stockholders; and
|
•
|
incurring additional debt or reducing available cash to service our existing debt.
|
•
|
disrupting our ongoing businesses;
|
•
|
reducing our revenues;
|
•
|
losing key personnel;
|
•
|
distracting management focus from our existing businesses;
|
•
|
indemnification claims for breaches of representations and warranties in sale agreements;
|
•
|
damaging relationships with employees and customers as a result of transferring a business to new owners; and
|
•
|
failure to close a transaction due to conditions such as financing or regulatory approvals not being satisfied.
|
•
|
quarterly variations in our operating results compared to market expectations;
|
•
|
guidance that we provide to the public, any changes in this guidance or our failure to meet this guidance;
|
•
|
changes in preferences of our customers;
|
•
|
announcements of new products or significant price reductions by us or our competitors;
|
•
|
size of our public float;
|
•
|
stock price performance of our competitors;
|
•
|
publication of research reports about our industry;
|
•
|
changes in market valuations of our competitors;
|
•
|
fluctuations in stock market prices and volumes;
|
•
|
default on our indebtedness;
|
•
|
actions by our competitors;
|
•
|
changes in senior management or key personnel;
|
•
|
changes in financial estimates by securities analysts;
|
•
|
negative earnings or other announcements by us or other credit reporting agencies;
|
•
|
downgrades in our credit ratings or the credit ratings of our competitors;
|
•
|
issuances of capital stock or future sales of our common stock or other securities;
|
•
|
investor perceptions or the investment opportunity associated with our common stock relative to other investment alternatives;
|
•
|
the public response to press releases or other public announcements by us or third parties, including our filings with the SEC;
|
•
|
announcements relating to litigation;
|
•
|
the sustainability of an active trading market for our stock;
|
•
|
changes in accounting principles;
|
•
|
global economic, legal and regulatory factors unrelated to our performance; and
|
•
|
other events or factors, including those resulting from natural disasters, war, acts of terrorism or responses to these events.
|
•
|
a classified Board of Directors with staggered three year terms;
|
•
|
the ability of our Board of Directors to issue one or more series of preferred stock;
|
•
|
advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;
|
•
|
certain limitations on convening special stockholder meetings;
|
•
|
the removal of directors only for cause and only upon the affirmative vote of the holders of at least 66
2
⁄
3
% in voting power of all the then-outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class; and
|
•
|
that certain provisions may be amended only by the affirmative vote of at least 66
2
⁄
3
% in voting power of all the then-outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class.
|
Name
|
Age
|
Position
|
James M. Peck
|
55
|
Director, President & Chief Executive Officer
|
Todd M. Cello
|
43
|
Executive Vice President & Chief Financial Officer
|
Christopher A. Cartwright
|
53
|
Executive Vice President-U.S. Information Services
|
John T. Danaher
|
54
|
Executive Vice President-Consumer Interactive
|
Abhi Dhar
|
47
|
Executive Vice President & Chief Information and Technology Officer
|
David M. Neenan
|
53
|
Executive Vice President-International
|
Heather J. Russell
|
47
|
Executive Vice President & Chief Legal Officer
|
David E. Wojczynski
|
46
|
Executive Vice President, Healthcare
|
Period
|
|
Total Number of
Shares Purchased
|
|
Average Price
Paid Per Share
|
|
Total Number of
Shares
Purchased as
Part of Publicly
Announced Plans
or Programs
(2)
|
|
Approximate Dollar
Value of Shares that
May Yet Be Purchased
Under
the Plans or Programs
(1)
|
||||||
October 1 to October 31
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
166.6
|
|
November 1 to November 30
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
166.6
|
|
|
December 1 to December 31
|
|
6,526
|
|
|
56.80
|
|
|
—
|
|
|
$
|
166.6
|
|
|
Total
|
|
6,526
|
|
|
$
|
56.80
|
|
|
—
|
|
|
|
(1)
|
On February 13, 2017, our board of directors authorized the repurchase of up to $300.0 million of our common stock through February 13, 2020. Our board of directors removed the three-year time limitation on February 8, 2018. Prior to the fourth quarter of 2017, we had purchased approximately $133.4 million of common stock under the program and may purchase up to an additional $166.6 million. Additional repurchases may be made from time to time at management’s discretion at prices management considers to be attractive through open market purchases or through privately negotiated transactions, subject to availability. Open market purchases will be conducted in accordance with the limitations set forth in Rule 10b-18 of the Exchange Act and other applicable legal requirements.
|
|
|
TransUnion
|
||||||||||||||||||
|
|
For the Twelve Months Ended December 31,
|
||||||||||||||||||
(dollars in millions)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Income Statement Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
|
$
|
2,317.2
|
|
|
$
|
1,933.8
|
|
|
$
|
1,704.9
|
|
|
$
|
1,506.8
|
|
|
$
|
1,304.7
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of services
|
|
790.1
|
|
|
645.7
|
|
|
579.1
|
|
|
531.6
|
|
|
500.2
|
|
|||||
Selling, general and administrative
|
|
707.7
|
|
|
585.4
|
|
|
560.1
|
|
|
499.7
|
|
|
434.9
|
|
|||||
Depreciation and amortization
|
|
306.9
|
|
|
238.0
|
|
|
265.2
|
|
|
278.4
|
|
|
241.2
|
|
|||||
Total operating expense
|
|
1,804.7
|
|
|
1,469.1
|
|
|
1,404.4
|
|
|
1,309.7
|
|
|
1,176.3
|
|
|||||
Operating income (loss)
|
|
512.5
|
|
|
464.7
|
|
|
300.5
|
|
|
197.1
|
|
|
128.4
|
|
|||||
Non-operating income and expense
|
|
(169.0
|
)
|
|
(92.2
|
)
|
|
(95.1
|
)
|
|
(170.5
|
)
|
|
(130.2
|
)
|
|||||
Income from continuing operations before income taxes
|
|
343.5
|
|
|
372.5
|
|
|
205.4
|
|
|
26.6
|
|
|
(1.8
|
)
|
|||||
(Provision) benefit for income taxes
|
|
(54.5
|
)
|
|
79.1
|
|
|
(74.0
|
)
|
|
(11.3
|
)
|
|
(2.6
|
)
|
|||||
Income (loss) from continuing operations
|
|
289.0
|
|
|
451.6
|
|
|
131.4
|
|
|
15.3
|
|
|
(4.4
|
)
|
|||||
Discontinued operations, net of tax
|
|
(1.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income
|
|
287.5
|
|
|
451.5
|
|
|
131.4
|
|
|
15.3
|
|
|
(4.4
|
)
|
|||||
Less: net income attributable to noncontrolling interests
|
|
(10.9
|
)
|
|
(10.4
|
)
|
|
(10.8
|
)
|
|
(9.4
|
)
|
|
(8.1
|
)
|
|||||
Net income (loss) attributable to the Company
|
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
|
$
|
5.9
|
|
|
$
|
(12.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings (loss) per share from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
1.51
|
|
|
$
|
2.42
|
|
|
$
|
0.66
|
|
|
$
|
0.04
|
|
|
$
|
(0.09
|
)
|
Diluted
|
|
$
|
1.46
|
|
|
$
|
2.32
|
|
|
$
|
0.65
|
|
|
$
|
0.04
|
|
|
$
|
(0.09
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
184.6
|
|
|
182.4
|
|
|
182.6
|
|
|
165.3
|
|
|
147.3
|
|
|||||
Diluted
|
|
190.9
|
|
|
189.9
|
|
|
184.6
|
|
|
166.8
|
|
|
147.3
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends per common share:
|
|
$
|
0.23
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
As of December 31,
|
||||||||||||||||||
(dollars in millions)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
(1)
|
|
$
|
7,039.8
|
|
|
$
|
5,118.5
|
|
|
$
|
4,781.2
|
|
|
$
|
4,442.8
|
|
|
$
|
4,633.8
|
|
Total debt
(1)
|
|
$
|
4,048.1
|
|
|
$
|
2,464.6
|
|
|
$
|
2,375.6
|
|
|
$
|
2,204.6
|
|
|
$
|
2,907.9
|
|
Total stockholders’ equity
(1)
|
|
$
|
1,982.2
|
|
|
$
|
1,824.6
|
|
|
$
|
1,473.0
|
|
|
$
|
1,367.0
|
|
|
$
|
747.7
|
|
(1)
|
The change in total assets at December 31, 2018, compared with December 31, 2017, is due primarily to businesses we acquired in 2018. The change in total debt at December 31, 2018, compared with December 2017, is due to new borrowings to fund our 2018 business acquisitions. The change in total debt and total stockholders’ equity at December 31, 2015, compared with December 31, 2014 reflects the impact of our initial public offering and the use of those proceeds to retire our public debt.
|
•
|
The U.S. Information Services (or “USIS”) segment provides consumer reports, risk scores, analytical and decisioning services to businesses. These businesses use our services to acquire new customers, assess consumers’ ability to pay for services, identify cross-selling opportunities, measure and manage debt portfolio risk, collect debt, verify consumer identities and investigate potential fraud. The core capabilities and delivery methods in our USIS segment allow us to serve a broad set of customers across industries. We report disaggregated revenue of our USIS segment for the financial services and emerging verticals.
|
•
|
The International segment provides services similar to our USIS segment to businesses in select regions outside the United States. Depending on the maturity of the credit economy in each country, services may include credit reports, analytics and decisioning services, and other value-added risk management services. In addition, we have insurance, business and automotive databases in select geographies. These services are offered to customers in a number of industries including financial services, insurance, automotive, collections, and communications, and are delivered through both direct and indirect channels. The International segment also provides consumer services similar to those offered by our Consumer Interactive segment that help consumers proactively manage their personal finances.
|
•
|
The Consumer Interactive segment offers solutions that help consumers manage their personal finances and take precautions against identity theft. Services in this segment include credit reports and scores, credit monitoring, fraud protection and resolution, and financial management. Our products are provided through user-friendly online and mobile interfaces and are supported by educational content and customer support. Our Consumer Interactive segment serves consumers through both direct and indirect channels.
|
•
|
On October 15, 2018, we acquired 100% of the equity of Rubixis, Inc. (“Rubixis”). Rubixis is an innovative healthcare revenue cycle solutions company that helps providers maximize reimbursement from insurance payers. Rubixis brings specialized expertise in the management of denials and underpayments, two significant pain points for healthcare providers. The results of operations of Rubixis, which are not material to our consolidated financial statements, have been included as part of our USIS segment in our consolidated statements of income since the date of the acquisition.
|
•
|
On June 29, 2018, we acquired 100% of the equity of iovation, Inc. (“iovation”). iovation is a provider of advanced device identity and consumer authentication services that helps businesses and consumers safely transact in a digital world. The results of operations of iovation, which are not material to our consolidated financial statements, have been included as part of our USIS segment in our consolidated statements of income since the date of the acquisition.
|
•
|
On June 22, 2018, we increased our noncontrolling interest investment in SavvyMoney, Inc. (“SavvyMoney”). Our initial investment in SavvyMoney was made on August 30, 2016. SavvyMoney is a provider of credit information services for bank and credit union users. We measure our investment in SavvyMoney at our initial cost, minus any impairments, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investments in SavvyMoney, with any adjustments recorded in other income and expense. We will record any future dividends in other income and expense when received.
|
•
|
On June 19, 2018, we acquired 100% of the equity of Callcredit Information Group, Ltd. (“Callcredit”). Callcredit is a U.K. based information solutions company founded in 2000 that provides data, analytics and technology solutions to help businesses and consumers make informed decisions. The results of operations of Callcredit have been included as part of our International segment in our consolidated statements of income since the date of the acquisition. See Part II, Item 8, “Notes to Consolidated Financial Statements,” Note 2, “Business Acquisitions,” for further information about this acquisition.
|
•
|
On June 1, 2018, we acquired 100% of the equity of Healthcare Payment Specialists, LLC (“HPS”). HPS provides expertise and technology solutions to help medical care providers maximize Medicare reimbursements. The results of
|
•
|
Financial Services:
The financial services vertical, which accounts for 53% of our 2018 USIS revenue, consists of our consumer lending, mortgage, auto and cards and payments lines of business. Our financial services clients consist of most banks, credit unions, finance companies, auto lenders, mortgage lenders, online-only lenders (FinTech), and other consumer lenders in the United States. We also distribute our solutions through most major resellers, secondary market players and sales agents. Beyond traditional lenders, we work with a variety of credit arrangers, such as auto dealers and peer-to-peer lenders. We provide solutions across every aspect of the lending lifecycle; customer acquisition and engagement, fraud and ID management, retention and recovery. Our products are focused on mitigating risk and include credit reporting, credit marketing, analytics and consulting, identity verification and authentication and debt recovery solutions.
|
•
|
Emerging Verticals:
Emerging verticals include healthcare, insurance, collections, property management, public sector and other diversified markets. Our solutions in these verticals are similar to the solutions in our financial services vertical and also address the entire customer lifecycle. We offer onboarding and retention solutions, transaction processing products, scoring products, marketing solutions, analytics and consulting, identity management and fraud solutions, and revenue optimization and collections solutions.
|
Consolidated Adjusted EBITDA
(1)
|
$
|
916.9
|
|
|
$
|
748.1
|
|
|
$
|
636.8
|
|
|
$
|
168.8
|
|
|
22.6
|
%
|
|
$
|
111.4
|
|
|
17.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Reconciliation of net income (loss) attributable to TransUnion to consolidated Adjusted EBITDA
(1)
:
|
|||||||||||||||||||||||||
|
|
|
|
|
|
|
Change
|
||||||||||||||||||
|
Twelve months ended December 31,
|
|
2018 vs. 2017
|
|
2017 vs. 2016
|
||||||||||||||||||||
(dollars in millions)
|
2018
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Net income (loss) attributable to TransUnion
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
|
$
|
(164.6
|
)
|
|
(37.3
|
)%
|
|
$
|
320.6
|
|
|
nm
|
|
Discontinued operations
|
1.5
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
|
nm
|
|
—
|
|
|
—%
|
|||||||
Net income from continuing operations attributable to Transunion
|
278.1
|
|
|
441.2
|
|
|
120.6
|
|
|
(163.1
|
)
|
|
(37.0
|
)%
|
|
320.6
|
|
|
nm
|
||||||
Net interest expense
|
132.0
|
|
|
82.1
|
|
|
80.9
|
|
|
49.9
|
|
|
60.7
|
%
|
|
1.3
|
|
|
1.5
|
%
|
|||||
(Benefit) Provision for income taxes
|
54.5
|
|
|
(79.1
|
)
|
|
74.0
|
|
|
133.6
|
|
|
nm
|
|
(153.1
|
)
|
|
nm
|
|||||||
Depreciation and amortization
|
306.9
|
|
|
238.0
|
|
|
265.2
|
|
|
68.9
|
|
|
28.9
|
%
|
|
(27.2
|
)
|
|
(10.2
|
)%
|
|||||
EBITDA
|
771.5
|
|
|
682.2
|
|
|
540.7
|
|
|
89.3
|
|
|
13.1
|
%
|
|
141.5
|
|
|
26.2
|
%
|
|||||
Adjustments to EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Acquisition-related revenue adjustments
(2)
|
28.1
|
|
|
—
|
|
|
—
|
|
|
28.1
|
|
|
nm
|
|
|
—
|
|
|
—
|
%
|
|||||
Stock-based compensation
(3)
|
61.4
|
|
|
47.7
|
|
|
31.2
|
|
|
13.7
|
|
|
28.7
|
%
|
|
16.5
|
|
|
52.7
|
%
|
|||||
Mergers and acquisitions, divestitures and business optimization
(4)
|
38.7
|
|
|
8.5
|
|
|
18.5
|
|
|
30.2
|
|
|
nm
|
|
|
(10.0
|
)
|
|
(53.9
|
)%
|
|||||
Technology transformation
(5)
|
—
|
|
|
—
|
|
|
23.3
|
|
|
—
|
|
|
—
|
%
|
|
(23.3
|
)
|
|
(100.0
|
)%
|
|||||
Other
(6)
|
17.2
|
|
|
9.7
|
|
|
23.1
|
|
|
7.5
|
|
|
77.0
|
%
|
|
(13.4
|
)
|
|
(57.9
|
)%
|
|||||
Total adjustments to EBITDA
|
145.4
|
|
|
65.9
|
|
|
96.1
|
|
|
79.5
|
|
|
120.6
|
%
|
|
(30.2
|
)
|
|
(31.4
|
)%
|
|||||
Consolidated Adjusted EBITDA
(1)
|
$
|
916.9
|
|
|
$
|
748.1
|
|
|
$
|
636.8
|
|
|
$
|
168.8
|
|
|
22.6
|
%
|
|
$
|
111.4
|
|
|
17.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other Metrics:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash provided by operating activities
|
$
|
559.4
|
|
|
$
|
465.8
|
|
|
$
|
389.9
|
|
|
$
|
93.6
|
|
|
20.1
|
%
|
|
$
|
75.9
|
|
|
19.5
|
%
|
Capital expenditures
|
$
|
(180.1
|
)
|
|
$
|
(135.3
|
)
|
|
$
|
(124.0
|
)
|
|
$
|
(44.8
|
)
|
|
33.1
|
%
|
|
$
|
(11.3
|
)
|
|
9.1
|
%
|
1.
|
We define Adjusted Revenue as GAAP revenue adjusted for certain acquisition-related deferred revenue and non-core contract-related revenue. We define Adjusted EBITDA as net income (loss) attributable to the Company before net interest expense, income tax provision (benefit), depreciation and amortization and other adjustments noted in the table above. We present Adjusted Revenue as a supplemental measure of revenue because we believe its provides a basis to compare revenue between periods. We present Adjusted EBITDA as a supplemental measure of our operating performance because it eliminates the impact of certain items that we do not consider indicative of our cash operations and ongoing operating performance. Also, Adjusted EBITDA is a measure frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies similar to ours. In addition, our board of directors and executive management team use Adjusted EBITDA as a compensation measure under our incentive compensation plan. Furthermore, under the credit agreement governing our senior secured credit facility, our ability to engage in activities such as incurring additional indebtedness, making investments and paying dividends is tied to a ratio based on Adjusted EBITDA. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Debt.” Adjusted EBITDA does not reflect our capital expenditures, interest, income tax, depreciation, amortization, stock-based compensation and certain other income and expense. Other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure. Because of these limitations, Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. Adjusted EBITDA is not a measure of financial condition or profitability under GAAP and should not be considered as an alternative to cash flows from operating activities, as a measure of liquidity or as an alternative to operating income or net income as indicators of operating
|
2.
|
This adjustment represents certain non-cash adjustments related to acquired entities, predominantly adjustments to increase revenue resulting from purchase accounting reductions to deferred revenue we record on the opening balance sheets of acquired entities. Deferred revenue results when a company receives payment in advance of fulfilling their performance obligations under contracts. Business combination accounting rules require us to record deferred revenue of acquired entities at fair value if we are obligated to perform any future services under these contracts. The fair value of this deferred revenue is determined based on the direct and indirect incremental costs of fulfilling our performance obligations under these contracts, plus a normal profit margin. Generally, this fair value calculation results in a reduction to the purchased deferred revenue balance. The above adjustment includes an estimate for the increase in revenue equal to the difference between what the acquired entities would have recorded as revenue and the lower revenue we record as a result of the reduced deferred revenue balance. This increase is partially offset by an estimated decrease to revenue for certain acquired non-core customer contracts that are not classified as discontinued operations that will expire within approximately one year from the date of acquisition. We present Adjusted Revenue as a supplemental measure of our revenue because we believe it provides meaningful information regarding our revenue and provides a basis to compare revenue between periods. In addition, our board of directors and executive management team use Adjusted Revenue as a compensation measure under our incentive compensation plans. The table above provides a reconciliation for revenue to Adjusted Revenue. The estimated adjustments to revenue are subject to change as we finalize the fair value assessments of the deferred revenue acquired with recent acquisitions and as we complete our assessment of the non-core customer contracts.
|
3.
|
Consisted of stock-based compensation and cash-settled stock-based compensation.
|
4.
|
For the twelve months ended December 31, 2018, consisted of the following adjustments: $29.3 million of acquisition expenses; $6.8 million of Callcredit integration costs; a $2.3 million loss on the divestiture of a small business operation; a $0.4 million adjustment to contingent consideration expense from previous acquisitions; and $(0.1) million of miscellaneous.
|
5.
|
Represented costs associated with a project to transform our technology infrastructure.
|
6.
|
For the twelve months ended December 31, 2018, consisted of the following adjustments: $12.0 million of fees related to new financing under our senior secured credit facility, $3.8 million of currency remeasurement of our foreign operations; $1.6 million of loan fees; $0.5 million of fees incurred in connection with a secondary offering of shares of TransUnion common stock by certain of our stockholders; and a $(0.7) million mark-to-market gain related to ineffectiveness of our interest rate hedge.
|
|
|
|
|
|
|
|
Change
|
||||||||||||||||||
|
Twelve months ended December 31,
|
|
2018 vs. 2017
|
|
2017 vs. 2016
|
||||||||||||||||||||
(dollars in millions)
|
2018
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Cost of services
|
$
|
790.1
|
|
|
$
|
645.7
|
|
|
$
|
579.1
|
|
|
$
|
144.5
|
|
|
22.4
|
%
|
|
$
|
66.6
|
|
|
11.5
|
%
|
Selling, general and administrative
|
707.7
|
|
|
585.4
|
|
|
560.1
|
|
|
122.2
|
|
|
20.9
|
%
|
|
25.3
|
|
|
4.5
|
%
|
|||||
Depreciation and amortization
|
306.9
|
|
|
238.0
|
|
|
265.2
|
|
|
68.9
|
|
|
28.9
|
%
|
|
(27.2
|
)
|
|
(10.3
|
)%
|
|||||
Total operating expenses
|
$
|
1,804.7
|
|
|
$
|
1,469.1
|
|
|
$
|
1,404.4
|
|
|
$
|
335.6
|
|
|
22.8
|
%
|
|
$
|
64.7
|
|
|
4.6
|
%
|
•
|
operating and integration-related costs relating to the business acquisitions in our USIS and International segments;
|
•
|
an increase in labor costs, primarily in our USIS and International segments, as we continue to invest in key strategic growth initiatives; and
|
•
|
an increase in product costs resulting from the increase in revenue, primarily in our USIS segment.
|
•
|
an increase in product costs resulting from the increase in revenue, primarily in our USIS segment;
|
•
|
an increase in labor costs, primarily in our USIS and International segments, as we continue to invest in key strategic growth initiatives;
|
•
|
operating costs related to our acquisitions in our USIS and International segments; and
|
•
|
the impact of strengthening foreign currencies on the expenses of our International segment,
|
•
|
savings enabled by our technology transformation and other key productivity initiatives; and
|
•
|
a decrease in product costs from a favorable shift in the mix of revenue in our Consumer Interactive segment.
|
•
|
operating and integration-related costs relating to the business acquisitions in our USIS and International segments; and
|
•
|
an increase in labor costs, primarily in our USIS segment and in Corporate, as we continue to invest in key strategic growth initiatives.
|
•
|
an increase in labor costs, primarily in our USIS and International segments, as we continue to invest in key strategic growth initiatives, and higher stock-based compensation;
|
•
|
the impact of strengthening foreign currencies on the expenses of our International segment; and
|
•
|
operating costs related to our acquisitions in our USIS and International segments,
|
•
|
a decrease in litigation expense in Corporate as a result of recording the settlement with the CFPB in 2016; and
|
•
|
the benefit of focusing our marketing spend on more efficient channels in our Consumer Interactive.
|
|
|
|
|
|
|
|
Change
|
||||||||||||||||||
|
Twelve months ended December 31,
|
|
2018 vs. 2017
|
|
2017 vs. 2016
|
||||||||||||||||||||
(dollars in millions)
|
2018
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Adjusted Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
USIS gross Adjusted Revenue
|
$
|
1,446.7
|
|
|
$
|
1,204.1
|
|
|
$
|
1,045.1
|
|
|
$
|
242.6
|
|
|
20.1
|
%
|
|
$
|
159.0
|
|
|
15.2
|
%
|
International gross Adjusted revenue
|
498.5
|
|
|
361.9
|
|
|
313.9
|
|
|
136.6
|
|
|
37.7
|
%
|
|
48.0
|
|
|
15.3
|
%
|
|||||
Interactive gross Adjusted Revenue
|
475.8
|
|
|
432.1
|
|
|
407.1
|
|
|
43.8
|
|
|
10.1
|
%
|
|
25.0
|
|
|
6.1
|
%
|
|||||
Total gross Adjusted Revenue
|
2,421.0
|
|
|
1,998.1
|
|
|
1,766.0
|
|
|
423.0
|
|
|
21.2
|
%
|
|
232.0
|
|
|
13.1
|
%
|
|||||
Less: intersegment revenue eliminations
|
(75.7
|
)
|
|
(64.2
|
)
|
|
(61.1
|
)
|
|
(11.5
|
)
|
|
(17.9
|
)%
|
|
(3.1
|
)
|
|
(5.1
|
)%
|
|||||
Consolidated Adjusted Revenue
|
$
|
2,345.3
|
|
|
$
|
1,933.8
|
|
|
$
|
1,704.9
|
|
|
$
|
411.5
|
|
|
21.3
|
%
|
|
$
|
229.0
|
|
|
13.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
USIS
|
$
|
576.1
|
|
|
$
|
492.3
|
|
|
$
|
428.6
|
|
|
$
|
83.8
|
|
|
17.0
|
%
|
|
$
|
63.7
|
|
|
14.9
|
%
|
International
|
193.0
|
|
|
135.0
|
|
|
113.7
|
|
|
58.0
|
|
|
43.0
|
%
|
|
21.3
|
|
|
18.7
|
%
|
|||||
Consumer Interactive
|
237.6
|
|
|
211.0
|
|
|
181.6
|
|
|
26.6
|
|
|
12.6
|
%
|
|
29.4
|
|
|
16.2
|
%
|
|||||
Corporate
|
(89.8
|
)
|
|
(90.2
|
)
|
|
(87.2
|
)
|
|
0.3
|
|
|
0.4
|
%
|
|
(2.9
|
)
|
|
(3.4
|
)%
|
|||||
Consolidated Adjusted EBITDA
|
$
|
916.9
|
|
|
$
|
748.1
|
|
|
$
|
636.8
|
|
|
$
|
168.8
|
|
|
22.6
|
%
|
|
$
|
111.4
|
|
|
17.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted EBITDA margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
USIS
|
39.8
|
%
|
|
40.9
|
%
|
|
41.0
|
%
|
|
|
|
(1.1
|
)%
|
|
|
|
(0.1
|
)%
|
|||||||
International
|
38.7
|
%
|
|
37.3
|
%
|
|
36.2
|
%
|
|
|
|
1.4
|
%
|
|
|
|
1.1
|
%
|
|||||||
Consumer Interactive
|
49.9
|
%
|
|
48.8
|
%
|
|
44.6
|
%
|
|
|
|
1.1
|
%
|
|
|
|
4.2
|
%
|
|||||||
Consolidated Adjusted EBITDA margin
|
39.1
|
%
|
|
38.7
|
%
|
|
37.3
|
%
|
|
|
|
0.4
|
%
|
|
|
|
1.3
|
%
|
•
|
an increase in revenue in all of our segments, including revenue from recent acquisitions,
|
•
|
operating and integration-related costs relating to the business acquisitions in our USIS and International segments;
|
•
|
an increase in labor costs, primarily in our USIS and International segments and in Corporate, as we continue to invest in key strategic growth initiatives; and
|
•
|
an increase in product costs resulting from the increase in revenue, primarily in our USIS and Consumer Interactive segments.
|
•
|
an increase in revenue in all of our segments, including revenue from recent acquisitions:
|
•
|
savings enabled by our technology transformation and other key productivity initiatives;
|
•
|
a decrease in product costs from a favorable shift in the mix of revenue in our Consumer Interactive segment; and
|
•
|
the benefit of focusing our marketing spend on more efficient channels in our Consumer Interactive segment,
|
•
|
an increase in labor costs, primarily in our USIS and International segments, as we continue to invest in key strategic growth initiatives;
|
•
|
an increase in product costs in our USIS segment due to the increase in revenue; and
|
•
|
operating and integration-related costs relating to the business acquisitions in our USIS and International segments;
|
|
|
|
|
|
|
|
Change
|
||||||||||||||||||
|
Twelve months ended December 31,
|
|
2018 vs. 2017
|
|
2017 vs. 2016
|
||||||||||||||||||||
(dollars in millions)
|
2018
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Interest expense
|
$
|
(137.5
|
)
|
|
$
|
(87.6
|
)
|
|
$
|
(85.5
|
)
|
|
$
|
(49.9
|
)
|
|
(57.0
|
)%
|
|
$
|
(2.1
|
)
|
|
(2.4
|
)%
|
Interest income
|
5.5
|
|
|
5.5
|
|
|
4.6
|
|
|
—
|
|
|
(0.1
|
)%
|
|
0.8
|
|
|
18.2
|
%
|
|||||
Earnings from equity method investments
|
9.9
|
|
|
9.1
|
|
|
8.6
|
|
|
0.9
|
|
|
9.8
|
%
|
|
0.5
|
|
|
5.4
|
%
|
|||||
Other income and expense, net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Acquisition fees
|
(29.3
|
)
|
|
(8.3
|
)
|
|
(17.6
|
)
|
|
(21.0
|
)
|
|
nm
|
|
|
9.2
|
|
|
52.7
|
%
|
|||||
Loan Fees
|
(13.6
|
)
|
|
(11.9
|
)
|
|
(1.4
|
)
|
|
(1.6
|
)
|
|
(13.4
|
)%
|
|
(10.5
|
)
|
|
nm
|
|
|||||
Dividends from cost method investments
|
1.1
|
|
|
1.0
|
|
|
0.9
|
|
|
0.1
|
|
|
14.6
|
%
|
|
0.1
|
|
|
12.2
|
%
|
|||||
Other income (expense), net
|
(5.2
|
)
|
|
0.1
|
|
|
(4.7
|
)
|
|
(5.3
|
)
|
|
nm
|
|
|
4.8
|
|
|
102.4
|
%
|
|||||
Total other income and expense, net
|
(46.9
|
)
|
|
(19.2
|
)
|
|
(22.8
|
)
|
|
(27.7
|
)
|
|
nm
|
|
|
3.7
|
|
|
16.0
|
%
|
|||||
Non-operating income and expense
|
$
|
(169.0
|
)
|
|
$
|
(92.2
|
)
|
|
$
|
(95.1
|
)
|
|
$
|
(76.7
|
)
|
|
83.2
|
%
|
|
$
|
2.9
|
|
|
3.0
|
%
|
|
Twelve months ended December 31,
|
|
Change
|
||||||||||||||||
(dollars in millions)
|
2018
|
|
2017
|
|
2016
|
|
2018 vs.
2017
|
|
2017 vs.
2016
|
||||||||||
Cash provided by operating activities
|
$
|
559.4
|
|
|
$
|
465.8
|
|
|
$
|
389.9
|
|
|
$
|
93.6
|
|
|
$
|
75.9
|
|
Cash used in investing activities
|
(2,017.6
|
)
|
|
(480.8
|
)
|
|
(495.8
|
)
|
|
(1,536.8
|
)
|
|
15.0
|
|
|||||
Cash (used in) provided by financing activities
|
1,540.2
|
|
|
(51.7
|
)
|
|
153.8
|
|
|
1,591.9
|
|
|
(205.5
|
)
|
|||||
Effect of exchange rate changes on cash and cash equivalents
|
(6.6
|
)
|
|
0.3
|
|
|
1.1
|
|
|
(6.9
|
)
|
|
(0.8
|
)
|
|||||
Net change in cash and cash equivalents
|
$
|
75.4
|
|
|
$
|
(66.4
|
)
|
|
$
|
49.0
|
|
|
$
|
141.8
|
|
|
$
|
(115.4
|
)
|
(in millions)
|
Operating
leases
|
|
Purchase
obligations and
other
|
|
Debt
repayments
|
|
Loan fees
and interest
payments
|
|
Total
|
||||||||||
2019
|
$
|
21.7
|
|
|
$
|
251.3
|
|
|
$
|
71.7
|
|
|
$
|
182.9
|
|
|
$
|
527.6
|
|
2020
|
18.9
|
|
|
45.7
|
|
|
93.5
|
|
|
171.5
|
|
|
329.6
|
|
|||||
2021
|
15.4
|
|
|
29.6
|
|
|
89.9
|
|
|
164.7
|
|
|
299.6
|
|
|||||
2022
|
10.5
|
|
|
4.1
|
|
|
1,044.9
|
|
|
147.6
|
|
|
1,207.1
|
|
|||||
2023
|
8.7
|
|
|
0.6
|
|
|
1,832.1
|
|
|
69.4
|
|
|
1,910.8
|
|
|||||
Thereafter
|
20.7
|
|
|
0.2
|
|
|
945.0
|
|
|
65.2
|
|
|
1,031.1
|
|
|||||
Totals
|
$
|
95.9
|
|
|
$
|
331.5
|
|
|
$
|
4,077.1
|
|
|
$
|
801.3
|
|
|
$
|
5,305.8
|
|
Reports of Independent Registered Public Accounting Firm
|
|
|
|
Consolidated Balance Sheets
|
|
|
|
Consolidated Statements of Income
|
|
|
|
Consolidated Statements of Comprehensive Income
|
|
|
|
Consolidated Statements of Cash Flows
|
|
|
|
Consolidated Statements of Stockholders’ Equity
|
|
|
|
Notes to Consolidated Financial Statements
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
187.4
|
|
|
$
|
115.8
|
|
Trade accounts receivable, net of allowance of $13.5 and $9.9
|
456.8
|
|
|
326.7
|
|
||
Other current assets
|
136.5
|
|
|
146.2
|
|
||
Current assets of discontinued operations
|
60.8
|
|
|
—
|
|
||
Total current assets
|
841.5
|
|
|
588.7
|
|
||
Property, plant and equipment, net of accumulated depreciation and amortization of $366.2 and $299.3
|
220.3
|
|
|
198.6
|
|
||
Goodwill
|
3,293.6
|
|
|
2,368.8
|
|
||
Other intangibles, net of accumulated amortization of $1,206.7 and $993.6
|
2,548.1
|
|
|
1,825.8
|
|
||
Other assets
|
136.3
|
|
|
136.6
|
|
||
Total assets
|
$
|
7,039.8
|
|
|
$
|
5,118.5
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Trade accounts payable
|
$
|
169.9
|
|
|
$
|
131.3
|
|
Short-term debt and current portion of long-term debt
|
71.7
|
|
|
119.3
|
|
||
Other current liabilities
|
284.1
|
|
|
207.8
|
|
||
Current liabilities of discontinued operations
|
22.8
|
|
|
—
|
|
||
Total current liabilities
|
548.5
|
|
|
458.4
|
|
||
Long-term debt
|
3,976.4
|
|
|
2,345.3
|
|
||
Deferred taxes
|
478.0
|
|
|
419.4
|
|
||
Other liabilities
|
54.7
|
|
|
70.8
|
|
||
Total liabilities
|
5,057.6
|
|
|
3,293.9
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock, $0.01 par value; 1.0 billion shares authorized at December 31, 2018 and December 31, 2017; 190.0 million and 187.4 million shares issued as of December 31, 2018 and December 31, 2017, respectively; and 185.7 million and 183.2 million shares outstanding as of December 31, 2018 and December 31, 2017, respectively
|
1.9
|
|
|
1.9
|
|
||
Additional paid-in capital
|
1,947.3
|
|
|
1,863.5
|
|
||
Treasury stock at cost; 4.2 million shares at December 31, 2018 and December 31, 2017
|
(139.9
|
)
|
|
(138.8
|
)
|
||
Retained earnings
|
363.1
|
|
|
137.4
|
|
||
Accumulated other comprehensive loss
|
(282.7
|
)
|
|
(135.3
|
)
|
||
Total TransUnion stockholders’ equity
|
1,889.7
|
|
|
1,728.7
|
|
||
Noncontrolling interest
|
92.5
|
|
|
95.9
|
|
||
Total stockholders’ equity
|
1,982.2
|
|
|
1,824.6
|
|
||
Total liabilities and stockholders’ equity
|
$
|
7,039.8
|
|
|
$
|
5,118.5
|
|
|
Twelve Months Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Revenue
|
$
|
2,317.2
|
|
|
$
|
1,933.8
|
|
|
$
|
1,704.9
|
|
Operating expenses
|
|
|
|
|
|
||||||
Cost of services (exclusive of depreciation and amortization below)
|
790.1
|
|
|
645.7
|
|
|
579.1
|
|
|||
Selling, general and administrative
|
707.7
|
|
|
585.4
|
|
|
560.1
|
|
|||
Depreciation and amortization
|
306.9
|
|
|
238.0
|
|
|
265.2
|
|
|||
Total operating expenses
|
1,804.7
|
|
|
1,469.1
|
|
|
1,404.4
|
|
|||
Operating income
|
512.5
|
|
|
464.7
|
|
|
300.5
|
|
|||
Non-operating income and (expense)
|
|
|
|
|
|
||||||
Interest expense
|
(137.5
|
)
|
|
(87.6
|
)
|
|
(85.5
|
)
|
|||
Interest income
|
5.5
|
|
|
5.5
|
|
|
4.6
|
|
|||
Earnings from equity method investments
|
9.9
|
|
|
9.1
|
|
|
8.6
|
|
|||
Other income and (expense), net
|
(46.9
|
)
|
|
(19.2
|
)
|
|
(22.8
|
)
|
|||
Total non-operating income and (expense)
|
(169.0
|
)
|
|
(92.2
|
)
|
|
(95.1
|
)
|
|||
Income from continuing operations before income taxes
|
343.5
|
|
|
372.5
|
|
|
205.4
|
|
|||
(Provision) benefit for income taxes
|
(54.5
|
)
|
|
79.1
|
|
|
(74.0
|
)
|
|||
Income from continuing operations
|
289.0
|
|
|
451.6
|
|
|
131.4
|
|
|||
Discontinued operations, net of tax
|
(1.5
|
)
|
|
—
|
|
|
—
|
|
|||
Net income
|
287.5
|
|
|
451.6
|
|
|
131.4
|
|
|||
Less: net income attributable to noncontrolling interests
|
(10.9
|
)
|
|
(10.4
|
)
|
|
(10.8
|
)
|
|||
Net income attributable to TransUnion
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
289.0
|
|
|
$
|
451.6
|
|
|
$
|
131.4
|
|
Less: income from continuing operations attributable to noncontrolling interests
|
(10.9
|
)
|
|
(10.4
|
)
|
|
(10.8
|
)
|
|||
Income from continuing operations attributable to TransUnion
|
278.1
|
|
|
441.2
|
|
|
120.6
|
|
|||
Discontinued operations, net of tax
|
(1.5
|
)
|
|
—
|
|
|
—
|
|
|||
Net income attributable to TransUnion
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
|
|
|
|
|
|
||||||
Basic earnings per common share from:
|
|
|
|
|
|
||||||
Income from continuing operations attributable to TransUnion
|
$
|
1.51
|
|
|
$
|
2.42
|
|
|
$
|
0.66
|
|
Discontinued operations, net of tax
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|||
Net Income attributable to TransUnion
|
$
|
1.50
|
|
|
$
|
2.42
|
|
|
$
|
0.66
|
|
Diluted earnings per common share from:
|
|
|
|
|
|
||||||
Income from continuing operations attributable to TransUnion
|
$
|
1.46
|
|
|
$
|
2.32
|
|
|
$
|
0.65
|
|
Discontinued operations, net of tax
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|||
Net Income attributable to TransUnion
|
$
|
1.45
|
|
|
$
|
2.32
|
|
|
$
|
0.65
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
184.6
|
|
|
182.4
|
|
|
182.6
|
|
|||
Diluted
|
190.9
|
|
|
189.9
|
|
|
184.6
|
|
|
Twelve Months Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net income
|
$
|
287.5
|
|
|
$
|
451.6
|
|
|
$
|
131.4
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Foreign currency translation:
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
(148.9
|
)
|
|
35.4
|
|
|
26.7
|
|
|||
Benefit for income taxes
|
—
|
|
|
0.6
|
|
|
2.7
|
|
|||
Foreign currency translation, net
|
(148.9
|
)
|
|
36.0
|
|
|
29.4
|
|
|||
Hedge instruments:
|
|
|
|
|
|
||||||
Net change on interest rate cap
|
7.6
|
|
|
10.1
|
|
|
(12.0
|
)
|
|||
Net change on interest rate swap
|
(10.7
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of accumulated loss
|
—
|
|
|
0.4
|
|
|
0.4
|
|
|||
Benefit (expense) for income taxes
|
0.8
|
|
|
(4.0
|
)
|
|
4.4
|
|
|||
Hedge instruments, net
|
(2.3
|
)
|
|
6.5
|
|
|
(7.2
|
)
|
|||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Net unrealized (loss) gain
|
—
|
|
|
(0.1
|
)
|
|
0.4
|
|
|||
Expense for income taxes
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|||
Available-for-sale securities, net
|
—
|
|
|
(0.1
|
)
|
|
0.2
|
|
|||
Total other comprehensive (loss) income, net of tax
|
(151.2
|
)
|
|
42.4
|
|
|
22.4
|
|
|||
Comprehensive income
|
136.3
|
|
|
494.0
|
|
|
153.8
|
|
|||
Less: comprehensive income attributable to noncontrolling interests
|
(7.1
|
)
|
|
(13.3
|
)
|
|
(16.2
|
)
|
|||
Comprehensive income attributable to TransUnion
|
$
|
129.2
|
|
|
$
|
480.7
|
|
|
$
|
137.6
|
|
|
Twelve Months Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
287.5
|
|
|
$
|
451.6
|
|
|
$
|
131.4
|
|
Add: loss from discontinued operations, net of tax
|
1.5
|
|
|
—
|
|
|
—
|
|
|||
Income from continuing operations
|
289.0
|
|
|
451.6
|
|
|
131.4
|
|
|||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
306.9
|
|
|
238.0
|
|
|
265.2
|
|
|||
Loss on debt financing transactions
|
12.0
|
|
|
10.5
|
|
|
—
|
|
|||
Amortization and (gain) loss on fair value of hedge instruments
|
(0.7
|
)
|
|
0.7
|
|
|
0.9
|
|
|||
Impairment of cost method investment, net
|
1.5
|
|
|
—
|
|
|
2.0
|
|
|||
Equity in net income of affiliates, net of dividends
|
(0.1
|
)
|
|
(1.7
|
)
|
|
(0.6
|
)
|
|||
Deferred taxes
|
(69.0
|
)
|
|
(212.8
|
)
|
|
(22.2
|
)
|
|||
Amortization of discount and deferred financing fees
|
4.8
|
|
|
2.7
|
|
|
3.2
|
|
|||
Stock-based compensation
|
57.9
|
|
|
33.1
|
|
|
24.4
|
|
|||
Payment of contingent obligation
|
(0.2
|
)
|
|
(2.2
|
)
|
|
—
|
|
|||
Provision for losses on trade accounts receivable
|
8.6
|
|
|
6.6
|
|
|
4.3
|
|
|||
Other
|
4.1
|
|
|
(3.4
|
)
|
|
(5.1
|
)
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Trade accounts receivable
|
(113.8
|
)
|
|
(44.7
|
)
|
|
(42.5
|
)
|
|||
Other current and long-term assets
|
17.1
|
|
|
(59.8
|
)
|
|
(5.9
|
)
|
|||
Trade accounts payable
|
20.7
|
|
|
9.7
|
|
|
2.9
|
|
|||
Other current and long-term liabilities
|
20.6
|
|
|
37.5
|
|
|
31.9
|
|
|||
Cash provided by operating activities of continuing operations
|
559.4
|
|
|
465.8
|
|
|
389.9
|
|
|||
Cash used in operating activities of discontinued operations
|
(3.7
|
)
|
|
—
|
|
|
—
|
|
|||
Cash provided by operating activities
|
555.7
|
|
|
465.8
|
|
|
389.9
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
(180.1
|
)
|
|
(135.3
|
)
|
|
(124.0
|
)
|
|||
Proceeds from sale of trading securities
|
1.8
|
|
|
3.0
|
|
|
0.9
|
|
|||
Purchases of trading securities
|
(2.1
|
)
|
|
(1.8
|
)
|
|
(1.5
|
)
|
|||
Proceeds from sale of other investments
|
24.3
|
|
|
59.2
|
|
|
58.2
|
|
|||
Purchases of other investments
|
(31.8
|
)
|
|
(50.2
|
)
|
|
(64.6
|
)
|
|||
Acquisitions and purchases of noncontrolling interests, net of cash acquired
|
(1,828.4
|
)
|
|
(342.6
|
)
|
|
(356.6
|
)
|
|||
Acquisition-related deposits
|
—
|
|
|
(13.5
|
)
|
|
(6.2
|
)
|
|||
Other
|
(1.3
|
)
|
|
0.4
|
|
|
(2.0
|
)
|
|||
Cash used in investing activities of continuing operations
|
(2,017.6
|
)
|
|
(480.8
|
)
|
|
(495.8
|
)
|
|||
Cash used in investing activities of discontinued operations
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|||
Cash used in investing activities
|
(2,017.7
|
)
|
|
(480.8
|
)
|
|
(495.8
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from Senior Secured Term Loan B-4
|
1,000.0
|
|
|
—
|
|
|
150.0
|
|
|||
Proceeds from Senior Secured Term Loan A-2
|
800.0
|
|
|
33.4
|
|
|
55.0
|
|
|||
Proceeds from senior secured revolving line of credit
|
125.0
|
|
|
215.0
|
|
|
145.0
|
|
|
Twelve Months Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from financing activities (continued):
|
|
|
|
|
|
||||||
Payments of senior secured revolving line of credit
|
(210.0
|
)
|
|
(130.0
|
)
|
|
(145.0
|
)
|
|||
Repayments of debt
|
(114.3
|
)
|
|
(32.5
|
)
|
|
(49.3
|
)
|
|||
Debt financing fees
|
(33.8
|
)
|
|
(12.6
|
)
|
|
(3.7
|
)
|
|||
Proceeds from issuance of common stock and exercise of stock options
|
26.2
|
|
|
27.1
|
|
|
6.0
|
|
|||
Dividends to stockholders
|
(41.6
|
)
|
|
—
|
|
|
—
|
|
|||
Treasury stock purchased
|
—
|
|
|
(133.5
|
)
|
|
(0.7
|
)
|
|||
Distributions to noncontrolling interests
|
(10.1
|
)
|
|
(10.3
|
)
|
|
(9.3
|
)
|
|||
Excess tax benefit
|
—
|
|
|
—
|
|
|
6.3
|
|
|||
Payment of contingent obligation
|
—
|
|
|
(8.3
|
)
|
|
(0.5
|
)
|
|||
Other
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
|||
Cash provided by (used in) financing activities
|
1,540.2
|
|
|
(51.7
|
)
|
|
153.8
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(6.6
|
)
|
|
0.3
|
|
|
1.1
|
|
|||
Net change in cash and cash equivalents
|
71.6
|
|
|
(66.4
|
)
|
|
49.0
|
|
|||
Cash and cash equivalents, beginning of period
|
115.8
|
|
|
182.2
|
|
|
133.2
|
|
|||
Cash and cash equivalents, end of period
|
$
|
187.4
|
|
|
$
|
115.8
|
|
|
$
|
182.2
|
|
|
|
|
|
|
|
||||||
Noncash investing activities:
|
|
|
|
|
|
||||||
Property and equipment acquired through capital lease obligations
|
$
|
0.1
|
|
|
$
|
1.2
|
|
|
$
|
—
|
|
Noncash financing activities:
|
|
|
|
|
|
||||||
Finance arrangements
|
$
|
—
|
|
|
$
|
0.5
|
|
|
$
|
16.3
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Cash paid during the period for:
|
|
|
|
|
|
||||||
Interest
|
$
|
132.1
|
|
|
$
|
90.2
|
|
|
$
|
87.9
|
|
Income taxes, net of refunds
|
$
|
111.1
|
|
|
$
|
120.2
|
|
|
$
|
93.6
|
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
Shares
|
|
Amount
|
|
Paid-In
Capital |
|
Treasury
Stock |
|
Accumulated
Deficit |
|
Accumulated
Other Comprehensive Loss |
|
Noncontrolling
Interests |
|
Total
|
|
Redeemable
Noncontrolling Interests |
|||||||||||||||||
Balance,
December 31, 2015 |
182.3
|
|
|
$
|
1.8
|
|
|
$
|
1,850.3
|
|
|
$
|
(4.6
|
)
|
|
$
|
(424.3
|
)
|
|
$
|
(191.8
|
)
|
|
$
|
135.6
|
|
|
$
|
1,367.0
|
|
|
$
|
2.9
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
120.6
|
|
|
—
|
|
|
10.8
|
|
|
131.4
|
|
|
—
|
|
||||||||
Other
comprehensive income |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17.0
|
|
|
0.8
|
|
|
17.8
|
|
|
4.6
|
|
||||||||
Distributions to
noncontrolling interests |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9.3
|
)
|
|
(9.3
|
)
|
|
—
|
|
||||||||
Adjustment of
redeemable noncontrolling interest |
—
|
|
|
—
|
|
|
(10.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.0
|
)
|
|
15.8
|
|
||||||||
Establishment of
noncontrolling interests |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.2
|
|
|
10.2
|
|
|
43.7
|
|
||||||||
Excess tax
benefit |
—
|
|
|
—
|
|
|
6.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.3
|
|
|
—
|
|
||||||||
Stock-based
compensation |
—
|
|
|
—
|
|
|
23.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23.7
|
|
|
—
|
|
||||||||
Employee share
purchase plan |
0.1
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
||||||||
Exercise of
stock options |
0.8
|
|
|
—
|
|
|
4.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.6
|
|
|
—
|
|
||||||||
Purchase of
noncontrolling interest |
—
|
|
|
—
|
|
|
(31.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(37.9
|
)
|
|
(69.3
|
)
|
|
(67.0
|
)
|
||||||||
Treasury stock
purchased |
—
|
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
||||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
||||||||
Balance,
December 31, 2016 |
183.2
|
|
|
$
|
1.8
|
|
|
$
|
1,844.9
|
|
|
$
|
(5.3
|
)
|
|
$
|
(303.8
|
)
|
|
$
|
(174.8
|
)
|
|
$
|
110.2
|
|
|
$
|
1,473.0
|
|
|
$
|
—
|
|
TRANSUNION AND SUBSIDIARIES
Consolidated Statements of Stockholders’ Equity—Continued (in millions) |
||||||||||||||||||||||||||||||
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Shares
|
|
Amount
|
|
Paid-In
Capital |
|
Treasury
Stock |
|
Accumulated
Deficit |
|
Accumulated
Other Comprehensive Loss |
|
Noncontrolling
Interests |
|
Total
|
|||||||||||||||
Net income
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
441.2
|
|
|
$
|
—
|
|
|
$
|
10.4
|
|
|
$
|
451.6
|
|
Other
comprehensive income |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39.5
|
|
|
2.9
|
|
|
42.4
|
|
|||||||
Distributions to
noncontrolling interests |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.3
|
)
|
|
(10.3
|
)
|
|||||||
Stock-based
compensation |
—
|
|
|
—
|
|
|
31.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31.8
|
|
|||||||
Employee share
purchase plan |
0.2
|
|
|
—
|
|
|
7.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7.5
|
|
|||||||
Exercise of
stock options |
3.3
|
|
|
0.1
|
|
|
20.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20.8
|
|
|||||||
Treasury stock
purchased |
(3.5
|
)
|
|
—
|
|
|
—
|
|
|
(133.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(133.5
|
)
|
|||||||
Purchase of
noncontrolling interest |
—
|
|
|
—
|
|
|
(41.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17.3
|
)
|
|
(58.7
|
)
|
|||||||
Balance,
December 31, 2017 |
183.2
|
|
|
$
|
1.9
|
|
|
$
|
1,863.5
|
|
|
$
|
(138.8
|
)
|
|
$
|
137.4
|
|
|
$
|
(135.3
|
)
|
|
$
|
95.9
|
|
|
$
|
1,824.6
|
|
TRANSUNION AND SUBSIDIARIES
Consolidated Statements of Stockholders’ Equity—Continued (in millions) |
||||||||||||||||||||||||||||||
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Shares
|
|
Amount
|
|
Paid-In
Capital |
|
Treasury
Stock |
|
Retained
Earnings |
|
Accumulated
Other Comprehensive Loss |
|
Noncontrolling
Interests |
|
Total
|
|||||||||||||||
Net income
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
276.6
|
|
|
$
|
—
|
|
|
$
|
10.9
|
|
|
$
|
287.5
|
|
Other
comprehensive income |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(147.4
|
)
|
|
(3.8
|
)
|
|
(151.2
|
)
|
|||||||
Distributions to
noncontrolling interests |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.7
|
)
|
|
(10.7
|
)
|
|||||||
Noncontrolling
interests of acquired businesses |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
0.3
|
|
|||||||
Stock-based
compensation |
—
|
|
|
—
|
|
|
55.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
55.9
|
|
|||||||
Employee share
purchase plan |
0.2
|
|
|
—
|
|
|
11.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11.3
|
|
|||||||
Exercise of
stock options |
2.3
|
|
|
—
|
|
|
16.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16.6
|
|
|||||||
Treasury stock
purchased |
—
|
|
|
—
|
|
|
—
|
|
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.2
|
)
|
|||||||
Dividends to
stockholders ($0.225 per share) |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42.6
|
)
|
|
—
|
|
|
—
|
|
|
(42.6
|
)
|
|||||||
Cumulative
effect of adopting Topic 606, net of tax |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.0
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
(6.1
|
)
|
|||||||
Cumulative
effect of adopting ASC 2016-16 |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.2
|
)
|
|
—
|
|
|
—
|
|
|
(2.2
|
)
|
|||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance,
December 31, 2018 |
185.7
|
|
|
$
|
1.9
|
|
|
$
|
1,947.3
|
|
|
$
|
(139.9
|
)
|
|
$
|
363.1
|
|
|
$
|
(282.7
|
)
|
|
$
|
92.5
|
|
|
$
|
1,982.2
|
|
(in millions)
|
|
Fair Value
|
||
Trade accounts receivable
|
|
$
|
19.7
|
|
Property and equipment
|
|
3.2
|
|
|
Goodwill
(1)
|
|
744.2
|
|
|
Identifiable intangible assets
|
|
725.1
|
|
|
All other assets
|
|
51.8
|
|
|
Assets of discontinued operations
(2)
|
|
58.4
|
|
|
Total assets acquired
|
|
1,602.4
|
|
|
|
|
|
||
Existing debt
|
|
—
|
|
|
All other liabilities
|
|
(174.6
|
)
|
|
Liabilities of discontinued operations
(2)
|
|
(19.6
|
)
|
|
Net assets of the acquired company
|
|
$
|
1,408.2
|
|
(1)
|
For tax purposes, we estimate that
none
of goodwill is tax deductible.
|
(2)
|
We have categorized certain businesses of Callcredit as discontinued operations in our consolidated financial statements. The preliminary fair value of assets and liabilities of these discontinued operations include an estimate of the fair value of the identifiable intangible assets and goodwill acquired. We will revise these estimates as we finalize our analysis of these discontinued operations and purchase price allocation.
|
(in millions)
|
|
Estimated Useful Life
|
|
Fair Value
|
||
Database and credit files
|
|
15 years
|
|
$
|
502.0
|
|
Customer relationships
|
|
15 years
|
|
155.0
|
|
|
Technology and software
|
|
5 years
|
|
67.4
|
|
|
Trademarks
|
|
2 years
|
|
0.7
|
|
|
Total identifiable assets
|
|
|
|
$
|
725.1
|
|
(in millions)
|
December 31,
2018 |
|
December 31,
2017 |
||||
Prepaid expenses
|
$
|
77.1
|
|
|
$
|
59.0
|
|
Other investments
|
23.6
|
|
|
18.3
|
|
||
Other receivables
|
14.3
|
|
|
16.5
|
|
||
Income taxes receivable
|
5.5
|
|
|
23.7
|
|
||
Marketable securities
|
2.9
|
|
|
3.3
|
|
||
Contract assets
|
1.0
|
|
|
—
|
|
||
Deferred financing fees
|
0.6
|
|
|
0.6
|
|
||
CFPB escrow deposit
|
—
|
|
|
13.9
|
|
||
Other
|
11.5
|
|
|
10.9
|
|
||
Total other current assets
|
$
|
136.5
|
|
|
$
|
146.2
|
|
(in millions)
|
December 31,
2018
|
|
December 31,
2017
|
||||
Computer equipment and furniture
|
$
|
341.0
|
|
|
$
|
276.1
|
|
Purchased software
|
134.4
|
|
|
119.4
|
|
||
Building and building improvements
|
107.9
|
|
|
99.2
|
|
||
Land
|
3.2
|
|
|
3.2
|
|
||
Total cost of property, plant and equipment
|
586.5
|
|
|
497.9
|
|
||
Less: accumulated depreciation
|
(366.2
|
)
|
|
(299.3
|
)
|
||
Total property, plant and equipment, net of accumulated depreciation
|
$
|
220.3
|
|
|
$
|
198.6
|
|
(in millions)
|
USIS
|
|
International
|
|
Consumer
Interactive
|
|
Total
|
||||||||
Balance, December 31, 2016
|
$
|
1,245.7
|
|
|
$
|
687.0
|
|
|
$
|
241.2
|
|
|
$
|
2,173.9
|
|
Purchase accounting adjustments
|
14.2
|
|
|
—
|
|
|
—
|
|
|
14.2
|
|
||||
Acquisitions
|
161.4
|
|
|
—
|
|
|
—
|
|
|
161.4
|
|
||||
Foreign exchange rate adjustment
|
—
|
|
|
19.3
|
|
|
—
|
|
|
19.3
|
|
||||
Balance, December 31, 2017
|
$
|
1,421.3
|
|
|
$
|
706.3
|
|
|
$
|
241.2
|
|
|
$
|
2,368.8
|
|
Purchase accounting adjustments
|
33.0
|
|
|
—
|
|
|
—
|
|
|
33.0
|
|
||||
Acquisitions
|
230.1
|
|
|
744.2
|
|
|
—
|
|
|
974.3
|
|
||||
Disposals
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
||||
Foreign exchange rate adjustment
|
—
|
|
|
(82.4
|
)
|
|
—
|
|
|
(82.4
|
)
|
||||
Balance, December 31, 2018
|
$
|
1,684.4
|
|
|
$
|
1,368.0
|
|
|
$
|
241.2
|
|
|
$
|
3,293.6
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
(in millions)
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Database and credit files
|
$
|
1,380.4
|
|
|
$
|
(375.7
|
)
|
|
$
|
1,004.7
|
|
|
$
|
854.8
|
|
|
$
|
(302.0
|
)
|
|
$
|
552.8
|
|
Internal use software
|
1,163.6
|
|
|
(582.6
|
)
|
|
581.0
|
|
|
946.2
|
|
|
(489.4
|
)
|
|
456.8
|
|
||||||
Customer relationships
|
632.3
|
|
|
(143.9
|
)
|
|
488.4
|
|
|
439.5
|
|
|
(114.4
|
)
|
|
325.1
|
|
||||||
Trademarks, copyrights and patents
|
571.7
|
|
|
(99.4
|
)
|
|
472.3
|
|
|
572.1
|
|
|
(84.2
|
)
|
|
487.9
|
|
||||||
Noncompete and other agreements
|
6.8
|
|
|
(5.1
|
)
|
|
1.7
|
|
|
6.8
|
|
|
(3.6
|
)
|
|
3.2
|
|
||||||
Total intangible assets
|
$
|
3,754.8
|
|
|
$
|
(1,206.7
|
)
|
|
$
|
2,548.1
|
|
|
$
|
2,819.4
|
|
|
$
|
(993.6
|
)
|
|
$
|
1,825.8
|
|
(in millions)
|
Annual
Amortization
Expense
|
||
2019
|
$
|
258.5
|
|
2020
|
239.1
|
|
|
2021
|
223.0
|
|
|
2022
|
214.1
|
|
|
2023
|
193.0
|
|
|
Thereafter
|
1,420.4
|
|
|
Total future amortization expense
|
$
|
2,548.1
|
|
(in millions)
|
December 31,
2018 |
|
December 31,
2017 |
||||
Investments in affiliated companies
|
$
|
81.9
|
|
|
$
|
79.2
|
|
Interest rate caps
|
16.5
|
|
|
9.4
|
|
||
Other investments
|
12.4
|
|
|
13.5
|
|
||
Marketable securities
|
12.4
|
|
|
12.7
|
|
||
Deposits
|
3.8
|
|
|
14.6
|
|
||
Deferred financing fees
|
1.6
|
|
|
2.0
|
|
||
Other
|
7.7
|
|
|
5.2
|
|
||
Total other assets
|
$
|
136.3
|
|
|
$
|
136.6
|
|
(in millions)
|
December 31,
2018 |
|
December 31,
2017 |
||||
Total equity method investments
|
$
|
44.0
|
|
|
$
|
42.8
|
|
Cost Method investments
|
37.9
|
|
|
36.4
|
|
||
Total investments in affiliated companies
|
$
|
81.9
|
|
|
$
|
79.2
|
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Earnings from equity method investments
|
|
$
|
9.9
|
|
|
$
|
9.1
|
|
|
$
|
8.6
|
|
Dividends received from equity method investments
|
|
$
|
9.8
|
|
|
$
|
7.4
|
|
|
$
|
8.0
|
|
(in millions)
|
December 31,
2018 |
|
December 31,
2017 |
||||
Accrued payroll
|
$
|
102.5
|
|
|
$
|
84.6
|
|
Deferred revenue
|
73.1
|
|
|
13.2
|
|
||
Accrued employee benefits
|
35.1
|
|
|
34.1
|
|
||
Accrued legal and regulatory
|
33.2
|
|
|
46.3
|
|
||
Income taxes payable
|
17.0
|
|
|
8.5
|
|
||
Accrued interest
|
2.5
|
|
|
1.5
|
|
||
Contingent consideration
|
1.2
|
|
|
1.1
|
|
||
Other
|
19.5
|
|
|
18.5
|
|
||
Total other current liabilities
|
$
|
284.1
|
|
|
$
|
207.8
|
|
(in millions)
|
December 31,
2018 |
|
December 31,
2017 |
||||
Unrecognized tax benefits
|
$
|
19.6
|
|
|
$
|
12.3
|
|
Interest rate swap
|
10.7
|
|
|
—
|
|
||
Retirement benefits
|
10.2
|
|
|
12.2
|
|
||
Income tax payable
|
5.0
|
|
|
25.6
|
|
||
Deferred revenue
|
0.9
|
|
|
—
|
|
||
Contingent consideration
|
0.1
|
|
|
—
|
|
||
Purchase consideration payable
|
—
|
|
|
12.2
|
|
||
Other
|
8.2
|
|
|
8.5
|
|
||
Total other liabilities
|
$
|
54.7
|
|
|
$
|
70.8
|
|
(in millions)
|
December 31,
2018 |
|
December 31,
2017 |
||||
Senior Secured Term Loan B-3, payable in quarterly installments through April 9, 2023, and periodic variable interest at LIBOR or alternate base rate, plus applicable margin (4.52% at December 31, 2018 and 3.57% at December 31, 2017), including original issue discount and deferred financing fees of $5.0 million and $4.6 million, respectively, at December 31, 2018, and original issue discount and deferred financing fees of $6.2 million and $3.7 million, respectively, at December 31, 2017
|
$
|
1,892.0
|
|
|
$
|
1,971.5
|
|
Senior Secured Term Loan A-2, payable in quarterly installments through August 9, 2022, and periodic variable interest at LIBOR or alternate base rate, plus applicable margin (4.27% at December 31, 2018 and 3.07% at December 31, 2017), including original issue discount and deferred financing fees of $2.8 million and $3.6 million, respectively, at December 31, 2018, and original issue discount and deferred financing fees of $1.4 million and $0.3 million, respectively, at December 31, 2017
|
1,166.0
|
|
|
395.8
|
|
||
Senior Secured Term Loan B-4, payable in quarterly installments through June 19, 2025, with periodic variable interest at LIBOR or alternate base rate, plus applicable margin (4.52% at December 31, 2018), net of original issue discount and deferred financing fees of $2.3 million and $10.7 million, respectively, at December 31, 2018
|
982.0
|
|
|
—
|
|
||
Senior Secured Revolving Line of Credit
|
—
|
|
|
85.0
|
|
||
Other notes payable
|
7.3
|
|
|
11.0
|
|
||
Capital lease obligations
|
0.8
|
|
|
1.3
|
|
||
Total debt
|
4,048.1
|
|
|
2,464.6
|
|
||
Less short-term debt and current portion of long-term debt
|
(71.7
|
)
|
|
(119.3
|
)
|
||
Total long-term debt
|
$
|
3,976.4
|
|
|
$
|
2,345.3
|
|
(in millions)
|
|
December 31,
2018 |
||
2019
|
|
$
|
71.7
|
|
2020
|
|
93.5
|
|
|
2021
|
|
89.9
|
|
|
2022
|
|
1,044.9
|
|
|
2023
|
|
1,832.1
|
|
|
Thereafter
|
|
945.0
|
|
|
Unamortized original issue discounts and deferred financing fees
|
|
(29.0
|
)
|
|
Total debt
|
|
$
|
4,048.1
|
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions, except per share data)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Income from continuing operations
|
|
$
|
289.0
|
|
|
$
|
451.6
|
|
|
$
|
131.4
|
|
Less: income from continuing operations attributable to noncontrolling interests
|
|
(10.9
|
)
|
|
(10.4
|
)
|
|
(10.8
|
)
|
|||
Income from continuing operations attributable to TransUnion
|
|
$
|
278.1
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
Discontinued operations, net of tax
(1)
|
|
(1.5
|
)
|
|
—
|
|
|
—
|
|
|||
Net income attributable to TransUnion
|
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
|
|
|
|
|
|
|
||||||
Basic earnings per common share from:
|
|
|
|
|
|
|
||||||
Income from continuing operations attributable to TransUnion
|
|
$
|
1.51
|
|
|
$
|
2.42
|
|
|
$
|
0.66
|
|
Discontinued operations, net of tax
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|||
Net Income attributable to TransUnion
|
|
$
|
1.50
|
|
|
$
|
2.42
|
|
|
$
|
0.66
|
|
|
|
|
|
|
|
|
||||||
Diluted earnings per common share from:
|
|
|
|
|
|
|
||||||
Income from continuing operations attributable to TransUnion
|
|
$
|
1.46
|
|
|
$
|
2.32
|
|
|
$
|
0.65
|
|
Discontinued operations, net of tax
(1)
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|||
Net Income attributable to TransUnion
|
|
$
|
1.45
|
|
|
$
|
2.32
|
|
|
$
|
0.65
|
|
|
|
|
|
|
|
|
||||||
Weighted-average shares outstanding:
|
|
|
|
|
|
|
||||||
Basic
|
|
184.6
|
|
|
182.4
|
|
|
182.6
|
|
|||
Dilutive impact of stock based awards
|
|
6.2
|
|
|
7.4
|
|
|
2.0
|
|
|||
Diluted
|
|
190.9
|
|
|
189.9
|
|
|
184.6
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
||||||
Federal
|
|
|
|
|
|
||||||
Current
|
$
|
62.7
|
|
|
$
|
82.3
|
|
|
$
|
53.9
|
|
Deferred
|
(57.0
|
)
|
|
(221.8
|
)
|
|
(21.3
|
)
|
|||
State
|
|
|
|
|
|
||||||
Current
|
11.9
|
|
|
8.4
|
|
|
6.9
|
|
|||
Deferred
|
(3.9
|
)
|
|
9.9
|
|
|
10.6
|
|
|||
Foreign
|
|
|
|
|
|
||||||
Current
|
48.9
|
|
|
43.0
|
|
|
35.4
|
|
|||
Deferred
|
(8.1
|
)
|
|
(0.9
|
)
|
|
(11.5
|
)
|
|||
Total provision (benefit) for income taxes
|
$
|
54.5
|
|
|
$
|
(79.1
|
)
|
|
$
|
74.0
|
|
|
Twelve Months Ended December 31,
|
|||||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
|||||||||
Domestic
|
$
|
256.5
|
|
|
$
|
265.7
|
|
|
$
|
128.0
|
|
|||
Foreign
|
87.0
|
|
|
106.8
|
|
|
77.4
|
|
||||||
Income before income taxes
|
$
|
343.5
|
|
|
$
|
372.5
|
|
|
$
|
205.4
|
|
|
Twelve Months Ended December 31,
|
|||||||||||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
Income taxes at statutory rate
|
$
|
72.1
|
|
|
21.0
|
%
|
|
$
|
130.4
|
|
|
35.0
|
%
|
|
$
|
71.9
|
|
|
35.0
|
%
|
Increase (decrease) resulting from:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
State taxes, net of federal benefit
|
10.2
|
|
|
3.0
|
%
|
|
5.6
|
|
|
1.5
|
%
|
|
15.4
|
|
|
7.5
|
%
|
|||
Foreign rate differential
|
9.7
|
|
|
2.8
|
%
|
|
(5.3
|
)
|
|
(1.4
|
)%
|
|
(1.8
|
)
|
|
(0.9
|
)%
|
|||
Tax impact of unremitted foreign earnings
|
5.7
|
|
|
1.7
|
%
|
|
2.1
|
|
|
0.6
|
%
|
|
(6.4
|
)
|
|
(3.1
|
)%
|
|||
U.S. tax impact of foreign earnings
|
(24.2
|
)
|
|
(7.0
|
)%
|
|
6.5
|
|
|
1.8
|
%
|
|
4.7
|
|
|
2.3
|
%
|
|||
R&D & DPAD tax credit
|
(2.2
|
)
|
|
(0.7
|
)%
|
|
(3.8
|
)
|
|
(1.0
|
)%
|
|
(5.0
|
)
|
|
(2.4
|
)%
|
|||
One-time impacts of U.S. tax reform
|
5.3
|
|
|
1.5
|
%
|
|
(175.3
|
)
|
|
(47.1
|
)%
|
|
—
|
|
|
—
|
%
|
|||
Excess Tax Benefit on stock-based compensation
|
(30.2
|
)
|
|
(8.8
|
)%
|
|
(39.3
|
)
|
|
(10.5
|
)%
|
|
—
|
|
|
—
|
%
|
|||
Nondeductible transaction costs
|
3.1
|
|
|
0.9
|
%
|
|
1.1
|
|
|
0.3
|
%
|
|
0.7
|
|
|
0.4
|
%
|
|||
Other
|
5.0
|
|
|
1.5
|
%
|
|
(1.1
|
)
|
|
(0.4
|
)%
|
|
(5.5
|
)
|
|
(2.8
|
)%
|
|||
Total
|
$
|
54.5
|
|
|
15.9
|
%
|
|
$
|
(79.1
|
)
|
|
(21.2
|
)%
|
|
$
|
74.0
|
|
|
36.0
|
%
|
(in millions)
|
December
31, 2018
|
|
December
31, 2017
|
||||
Deferred income tax assets:
|
|
|
|
||||
Compensation
|
$
|
24.1
|
|
|
$
|
16.4
|
|
Employee benefits
|
13.1
|
|
|
2.5
|
|
||
Legal reserves and settlements
|
3.9
|
|
|
5.2
|
|
||
Hedge investments
|
1.2
|
|
|
1.1
|
|
||
Financing related costs
|
2.5
|
|
|
—
|
|
||
Loss and credit carryforwards
|
103.7
|
|
|
105.7
|
|
||
Other
|
11.8
|
|
|
7.7
|
|
||
Gross deferred income tax assets
|
160.3
|
|
|
138.6
|
|
||
Valuation allowance
|
(51.9
|
)
|
|
(85.3
|
)
|
||
Total deferred income tax assets, net
|
$
|
108.4
|
|
|
$
|
53.3
|
|
Deferred income tax liabilities:
|
|
|
|
||||
Depreciation and amortization
|
$
|
(568.8
|
)
|
|
$
|
(454.7
|
)
|
Taxes on undistributed foreign earnings
|
(11.0
|
)
|
|
(7.3
|
)
|
||
Other
|
(4.2
|
)
|
|
(8.8
|
)
|
||
Total deferred income tax liability
|
(584.0
|
)
|
|
(470.8
|
)
|
||
Net deferred income tax liability
|
$
|
(475.6
|
)
|
|
$
|
(417.5
|
)
|
(in millions)
|
December 31,
2018
|
|
December 31,
2017
|
||||
Balance as of beginning of period
|
$
|
12.3
|
|
|
$
|
4.8
|
|
Increase in tax positions of prior years
|
7.6
|
|
|
2.8
|
|
||
Decrease in tax positions of prior years
|
(1.0
|
)
|
|
—
|
|
||
Increase in tax positions of current year
|
0.7
|
|
|
4.7
|
|
||
Balance as of end of period
|
$
|
19.6
|
|
|
$
|
12.3
|
|
|
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Term
(in years)
|
|
Aggregate
Intrinsic Value (in millions) |
|||||
Outstanding as of December 31, 2017
|
5,494,372
|
|
|
$
|
7.42
|
|
|
5.4
|
|
$
|
261.2
|
|
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
(2,335,312
|
)
|
|
7.11
|
|
|
|
|
|
|||
Forfeited
|
(78,912
|
)
|
|
13.59
|
|
|
|
|
|
|||
Expired
|
—
|
|
|
—
|
|
|
|
|
|
|||
Outstanding as of December 31, 2018
|
3,080,148
|
|
|
$
|
7.49
|
|
|
4.4
|
|
$
|
151.9
|
|
|
|
|
|
|
|
|
|
|||||
Expected to vest as of December 31, 2018
|
220,165
|
|
|
$
|
12.87
|
|
|
5.8
|
|
$
|
9.7
|
|
Exercisable as of December 31, 2018
|
2,854,770
|
|
|
$
|
7.07
|
|
|
4.3
|
|
$
|
142.0
|
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Intrinsic value of options exercised
|
|
$
|
134.4
|
|
|
$
|
120.3
|
|
|
$
|
19.4
|
|
Total fair value of options vested
|
|
$
|
10.3
|
|
|
$
|
14.0
|
|
|
$
|
3.9
|
|
|
Shares
|
|
Weighted
Average Grant Date
Fair Value
|
|
Weighted
Average
Remaining
Contractual
Term
(in years)
|
|
Aggregate
Intrinsic Value (in millions) |
||||||
Outstanding as of December 31, 2017
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Granted
|
1,126,090
|
|
|
71.66
|
|
|
|
|
|
||||
Vested
|
—
|
|
|
—
|
|
|
|
|
|
||||
Forfeited
|
(9,769
|
)
|
|
71.64
|
|
|
|
|
|
||||
Expired
|
—
|
|
|
—
|
|
|
|
|
|
||||
Outstanding as of December 31, 2018
|
1,116,321
|
|
|
$
|
71.66
|
|
|
2.0
|
|
|
$
|
63.4
|
|
|
|
|
|
|
|
|
|
||||||
Expected to vest as of December 31, 2018
|
653,293
|
|
|
$
|
71.66
|
|
|
2.0
|
|
|
$
|
37.1
|
|
(in millions)
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Interest rate caps
|
$
|
16.5
|
|
|
$
|
—
|
|
|
$
|
16.5
|
|
|
$
|
—
|
|
Trading securities
|
12.4
|
|
|
7.8
|
|
|
4.6
|
|
|
—
|
|
||||
Available-for-sale securities
|
2.9
|
|
|
—
|
|
|
2.9
|
|
|
—
|
|
||||
Total
|
$
|
31.8
|
|
|
$
|
7.8
|
|
|
$
|
24.0
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
$
|
(10.7
|
)
|
|
$
|
—
|
|
|
$
|
(10.7
|
)
|
|
$
|
—
|
|
Contingent consideration
|
(1.3
|
)
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
||||
Total
|
$
|
(12.0
|
)
|
|
$
|
—
|
|
|
$
|
(10.7
|
)
|
|
$
|
(1.3
|
)
|
•
|
Financial Services:
The financial services vertical, which accounts for
53%
of our 2018 USIS revenue, consists of our consumer lending, mortgage, auto and cards and payments lines of business. Our financial services clients consist of most banks, credit unions, finance companies, auto lenders, mortgage lenders, online-only lenders (FinTech), and other consumer lenders in the United States. We also distribute our solutions through most major resellers, secondary market players and sales agents. Beyond traditional lenders, we work with a variety of credit arrangers, such as auto dealers and peer-to-peer lenders. We provide solutions across every aspect of the lending lifecycle; customer acquisition and engagement, fraud and ID management, retention and recovery. Our products are focused on mitigating risk and include credit reporting, credit marketing, analytics and consulting, identity verification and authentication and debt recovery solutions.
|
•
|
Emerging Verticals:
Emerging verticals include healthcare, insurance, collections, property management, public sector and other diversified markets. Our solutions in these verticals are similar to the solutions in our financial services vertical and also address the entire customer lifecycle. We offer onboarding and retention solutions, transaction processing products, scoring products, marketing solutions, analytics and consulting, identity management and fraud solutions, and revenue optimization and collections solutions.
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
||||||
Gross revenue:
|
|
|
|
|
|
||||||
U.S. Information Services:
|
|
|
|
|
|
|
|
|
|||
Financial Services
|
$
|
765.1
|
|
|
$
|
620.0
|
|
|
$
|
551.7
|
|
Emerging Verticals
|
679.6
|
|
|
584.1
|
|
|
493.4
|
|
|||
Total U.S. Information Services
|
$
|
1,444.7
|
|
|
$
|
1,204.1
|
|
|
$
|
1,045.1
|
|
|
|
|
|
|
|
||||||
International:
|
|
|
|
|
|
||||||
Canada
|
$
|
96.0
|
|
|
$
|
85.8
|
|
|
$
|
73.9
|
|
Latin America
|
102.3
|
|
|
98.4
|
|
|
86.9
|
|
|||
United Kingdom
|
71.3
|
|
|
—
|
|
|
—
|
|
|||
Africa
|
64.2
|
|
|
61.3
|
|
|
60.6
|
|
|||
India
|
81.8
|
|
|
64.6
|
|
|
47.5
|
|
|||
Asia Pacific
|
56.7
|
|
|
51.9
|
|
|
45.0
|
|
|||
Total International
|
$
|
472.4
|
|
|
$
|
361.9
|
|
|
$
|
313.9
|
|
|
|
|
|
|
|
||||||
Total Consumer Interactive
|
$
|
475.8
|
|
|
$
|
432.1
|
|
|
$
|
407.1
|
|
|
|
|
|
|
|
||||||
Total revenue, gross
|
$
|
2,392.9
|
|
|
$
|
1,998.1
|
|
|
$
|
1,766.0
|
|
|
|
|
|
|
|
||||||
Intersegment revenue eliminations:
|
|
|
|
|
|
||||||
U.S. Information Services
|
$
|
(70.0
|
)
|
|
$
|
(59.3
|
)
|
|
$
|
(57.0
|
)
|
International
|
(5.1
|
)
|
|
(4.8
|
)
|
|
(4.0
|
)
|
|||
Consumer Interactive
|
(0.7
|
)
|
|
(0.2
|
)
|
|
—
|
|
|||
Total intersegment eliminations
|
(75.7
|
)
|
|
(64.2
|
)
|
|
(61.1
|
)
|
|||
Total revenues, net
|
$
|
2,317.2
|
|
|
$
|
1,933.8
|
|
|
$
|
1,704.9
|
|
|
|
|
|
|
|
||||||
Adjusted EBITDA:
|
|
|
|
|
|
||||||
U.S. Information Services
|
$
|
576.1
|
|
|
$
|
492.3
|
|
|
$
|
428.6
|
|
International
|
193.0
|
|
|
135.0
|
|
|
113.7
|
|
|||
Consumer Interactive
|
237.6
|
|
|
211.0
|
|
|
181.6
|
|
|||
Corporate
|
(89.8
|
)
|
|
(90.2
|
)
|
|
(87.2
|
)
|
|||
Consolidated Adjusted EBITDA
|
$
|
916.9
|
|
|
$
|
748.1
|
|
|
$
|
636.8
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
||||||
Net income attributable to TransUnion
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
Discontinued operations
|
1.5
|
|
|
—
|
|
|
—
|
|
|||
Net income from continuing operations attributable to TransUnion
|
278.1
|
|
|
441.2
|
|
|
120.6
|
|
|||
Net interest expense
|
132.0
|
|
|
82.1
|
|
|
80.9
|
|
|||
Provision (benefit) for income taxes
|
54.5
|
|
|
(79.1
|
)
|
|
74.0
|
|
|||
Depreciation and amortization
|
306.9
|
|
|
238.0
|
|
|
265.2
|
|
|||
EBITDA
|
771.5
|
|
|
682.2
|
|
|
540.7
|
|
|||
Adjustments to EBITDA:
|
|
|
|
|
|
||||||
Acquisition-related revenue adjustments
|
28.1
|
|
|
—
|
|
|
—
|
|
|||
Stock-based compensation
|
61.4
|
|
|
47.7
|
|
|
31.2
|
|
|||
Mergers and acquisitions, divestitures and business optimization
|
38.7
|
|
|
8.5
|
|
|
18.5
|
|
|||
Technology transformation
|
—
|
|
|
—
|
|
|
23.3
|
|
|||
Other
|
17.2
|
|
|
9.7
|
|
|
23.1
|
|
|||
Total adjustments to EBITDA
|
145.4
|
|
|
65.9
|
|
|
96.1
|
|
|||
Adjusted EBITDA
|
$
|
916.9
|
|
|
$
|
748.1
|
|
|
$
|
636.8
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
||||||
U.S. Information Services
|
$
|
2.6
|
|
|
$
|
2.0
|
|
|
$
|
1.9
|
|
International
|
7.3
|
|
|
7.1
|
|
|
6.7
|
|
|||
Total
|
$
|
9.9
|
|
|
$
|
9.1
|
|
|
$
|
8.6
|
|
(in millions)
|
December 31,
2018
|
|
December 31, 2017
|
||||
U.S. Information Services
|
$
|
3,541.2
|
|
|
$
|
3,070.9
|
|
International
|
2,991.4
|
|
|
1,538.0
|
|
||
Consumer Interactive
|
466.9
|
|
|
431.9
|
|
||
Corporate
|
40.3
|
|
|
77.7
|
|
||
Total
|
$
|
7,039.8
|
|
|
$
|
5,118.5
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
||||||
U.S. Information Services
|
$
|
122.7
|
|
|
$
|
88.8
|
|
|
$
|
82.5
|
|
International
|
44.1
|
|
|
34.3
|
|
|
30.2
|
|
|||
Consumer Interactive
|
11.2
|
|
|
9.6
|
|
|
9.1
|
|
|||
Corporate
|
2.1
|
|
|
2.6
|
|
|
2.2
|
|
|||
Total
|
$
|
180.1
|
|
|
$
|
135.3
|
|
|
$
|
124.0
|
|
|
Twelve Months Ended December 31,
|
||||||||||
(in millions)
|
2018
|
|
2017
|
|
2016
|
||||||
U.S. Information Services
|
$
|
191.2
|
|
|
$
|
160.6
|
|
|
$
|
191.0
|
|
International
|
98.4
|
|
|
61.5
|
|
|
57.2
|
|
|||
Consumer Interactive
|
12.2
|
|
|
10.7
|
|
|
11.7
|
|
|||
Corporate
|
5.1
|
|
|
5.2
|
|
|
5.3
|
|
|||
Total
|
$
|
306.9
|
|
|
$
|
238.0
|
|
|
$
|
265.2
|
|
(in millions)
|
Operating
Leases
|
|
Purchase
Obligations and
Other
|
|
Total
|
||||||
2019
|
$
|
21.7
|
|
|
$
|
251.3
|
|
|
$
|
273.0
|
|
2020
|
18.9
|
|
|
45.7
|
|
|
64.6
|
|
|||
2021
|
15.4
|
|
|
29.6
|
|
|
45.0
|
|
|||
2022
|
10.5
|
|
|
4.1
|
|
|
14.6
|
|
|||
2023
|
8.7
|
|
|
0.6
|
|
|
9.3
|
|
|||
Thereafter
|
20.7
|
|
|
0.2
|
|
|
20.9
|
|
|||
Totals
|
$
|
95.9
|
|
|
$
|
331.5
|
|
|
$
|
427.4
|
|
|
Three Months Ended
|
||||||||||||||
(in millions)
|
December 31,
2018
|
|
September 30,
2018
|
|
June 30,
2018
|
|
March 31,
2018
|
||||||||
Revenue
|
$
|
613.1
|
|
|
$
|
603.6
|
|
|
$
|
563.1
|
|
|
$
|
537.4
|
|
Operating income
|
130.7
|
|
|
122.1
|
|
|
134.4
|
|
|
125.2
|
|
||||
Income from continuing operations
|
105.5
|
|
|
50.8
|
|
|
57.3
|
|
|
75.4
|
|
||||
Net income
|
105.4
|
|
|
49.4
|
|
|
57.3
|
|
|
75.4
|
|
||||
Net income attributable to TransUnion
|
102.1
|
|
|
46.3
|
|
|
55.0
|
|
|
73.1
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings per common share from:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations attributable to TransUnion
|
$
|
0.55
|
|
|
$
|
0.26
|
|
|
$
|
0.30
|
|
|
$
|
0.40
|
|
Net Income attributable to TransUnion
|
$
|
0.55
|
|
|
$
|
0.25
|
|
|
$
|
0.30
|
|
|
$
|
0.40
|
|
Diluted earnings per common share from:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations attributable to TransUnion
|
$
|
0.53
|
|
|
$
|
0.25
|
|
|
$
|
0.29
|
|
|
$
|
0.38
|
|
Net Income attributable to TransUnion
|
$
|
0.53
|
|
|
$
|
0.24
|
|
|
$
|
0.29
|
|
|
$
|
0.38
|
|
|
Three Months Ended
|
||||||||||||||
(in millions)
|
December 31, 2017
(1)
|
|
September 30,
2017
|
|
June 30,
2017
|
|
March 31,
2017
|
||||||||
Revenue
|
$
|
506.1
|
|
|
$
|
498.0
|
|
|
$
|
474.8
|
|
|
$
|
455.0
|
|
Operating income
|
121.5
|
|
|
126.6
|
|
|
115.5
|
|
|
101.1
|
|
||||
Income from continuing operations
|
247.9
|
|
|
71.9
|
|
|
67.3
|
|
|
64.5
|
|
||||
Net income
|
247.9
|
|
|
71.9
|
|
|
67.3
|
|
|
64.5
|
|
||||
Net income attributable to TransUnion
|
245.1
|
|
|
68.8
|
|
|
64.9
|
|
|
62.3
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings per common share from:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations attributable to TransUnion
|
$
|
1.34
|
|
|
$
|
0.38
|
|
|
$
|
0.36
|
|
|
$
|
0.34
|
|
Net Income attributable to TransUnion
|
$
|
1.34
|
|
|
$
|
0.38
|
|
|
$
|
0.36
|
|
|
$
|
0.34
|
|
Diluted earnings per common share from:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations attributable to TransUnion
|
$
|
1.29
|
|
|
$
|
0.36
|
|
|
$
|
0.34
|
|
|
$
|
0.33
|
|
Net Income attributable to TransUnion
|
$
|
1.29
|
|
|
$
|
0.36
|
|
|
$
|
0.34
|
|
|
$
|
0.33
|
|
(in millions)
|
Foreign Currency
Translation
Adjustment
|
|
Net Unrealized
Gain/(Loss)
On Hedges
|
|
Net Unrealized
Gain/(Loss) On
Available-for-sale
Securities
|
|
Accumulated Other
Comprehensive Loss
|
||||||||
Balance, December 31, 2015
|
$
|
(191.6
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
0.1
|
|
|
$
|
(191.8
|
)
|
Change
|
24.0
|
|
|
(7.2
|
)
|
|
0.2
|
|
|
17.0
|
|
||||
Balance, December 31, 2016
|
$
|
(167.6
|
)
|
|
$
|
(7.5
|
)
|
|
$
|
0.3
|
|
|
$
|
(174.8
|
)
|
Change
|
33.1
|
|
|
6.5
|
|
|
(0.1
|
)
|
|
39.5
|
|
||||
Balance, December 31, 2017
|
$
|
(134.5
|
)
|
|
$
|
(1.0
|
)
|
|
$
|
0.2
|
|
|
$
|
(135.3
|
)
|
Change
|
(145.1
|
)
|
|
(2.3
|
)
|
|
—
|
|
|
(147.4
|
)
|
||||
Balance, December 31, 2018
|
$
|
(279.6
|
)
|
|
$
|
(3.3
|
)
|
|
$
|
0.2
|
|
|
$
|
(282.7
|
)
|
•
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of TransUnion;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles;
|
•
|
provide reasonable assurance that receipts and expenditures of TransUnion are being made only in accordance with the authorizations of management and directors of TransUnion; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the consolidated financial statements.
|
(a)
|
List of Documents Filed as a Part of This Report:
|
(1)
|
Financial Statements
. The following financial statements are included in Item 8 of Part II:
|
•
|
Consolidated Balance Sheets—December 31, 2018 and 2017;
|
•
|
Consolidated Statements of Income for the years ended December 31, 2018, 2017 and 2016;
|
•
|
Consolidated Statements of Comprehensive Income for the years ended December 31, 2018, 2017 and 2016;
|
•
|
Consolidated Statements of Cash Flows for the years ended December 31, 2018, 2017 and 2016;
|
•
|
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2018, 2017 and 2016;
|
•
|
Notes to Consolidated Financial Statements.
|
(2)
|
Financial Statement Schedules.
|
•
|
Schedule I - Condensed Financial Information of TransUnion;
|
•
|
Schedule I - Notes to Financial Information of TransUnion; and
|
•
|
Schedule II—Valuation and Qualifying Accounts.
|
(3)
|
The following exhibits are filed with this Annual Report on Form 10-K for the fiscal year ended December, 31, 2018, or incorporated herein by reference.
|
Exhibit
No. |
|
Exhibit Name
|
|
|
|
|
Purchase Agreement Made as a Deed, dated December 9, 2015, by and among TransUnion Netherlands I B.V., Trustev Limited, the Non-Management Sellers Identified therein, the Management Sellers identified therein and the Management Seller Representative named therein (Incorporated by reference to Exhibit 2.1 to TransUnion’s Current Report on Form 8-K filed December 15, 2015).
|
|
|
|
|
|
Agreement with respect to certain Shares and Options of Trustev Limited Made as a Deed, dated as of December 9, 2015, by and among Trustev Limited, TransUnion Netherlands I B.V., the Management Holders identified therein and the Management Holder Representative named therein (Incorporated by reference to Exhibit 2.2 to TransUnion’s Current Report on Form 8-K filed December 15, 2015).
|
|
|
|
|
|
Share Purchase Sale Agreement, dated February 8, 2016, among TransUnion Netherlands II B.V., Bancolombia S.A., Banco Bilbao Vizcaya Argentaria Colombia S.A., Banco Davivienda S.A., Banco Corpbanca Colombia S.A., Banco de Bogota S.A., Banco de Occidente S.A., Banco GNB Sudameris S.A., Banco Colpatria Multibanca S.A., Banco Popular S.A., Banco Caja Social S.A., Corporacion Financiera Colombiana S.A., Banco Comercial AV Villas S.A., Citibank - Colombia S.A., Banco Compartir S.A., JP Morgan Corporacion Financiera S.A., Titularizadora Colombiana S.A., and Banco de las Microfinanzas-Banamia S.A., as Sellers, TransUnion, as guarantor, and Central de Informacion Financiera S.A. (Incorporated by reference to Exhibit 2.1 to TransUnion’s Current Report on Form 8-K filed on February 12, 2016).
|
|
|
|
|
|
Purchase Agreement, dated September 21, 2016, by and among TransUnion Healthcare, Inc., RTech Healthcare Revenue Technologies, Inc., the Sellers identified therein, and the Seller Representative named therein (Incorporated by reference to Exhibit 2.1 to TransUnion’s Current Report on Form 8-K filed on September 22, 2016).
|
|
|
|
|
|
Share Purchase Agreement, dated as of April 20, 2018 by and among Vail Holdings UK Ltd., Crown Acquisition Topco Limited, Crown Holdco S.À R.L., the EBT Beneficiary Sellers named therein, the Individual Sellers named therein, the EBT Seller named therein, each additional Seller who may become a party thereto, Crown Holdco S.À R.L., solely in its capacity as the Seller Representative and TransUnion, solely for purposes of Section 11.21 (Incorporated by reference to Exhibit 2.1 to TransUnion’s Current Report on Form 8-K filed on April 25, 2018) .
|
|
|
|
|
|
Second Amended and Restated Certificate of Incorporation of TransUnion (Incorporated by reference to Exhibit 4.1 to TransUnion’s Registration Statement on Form S-8 filed June 26, 2015).
|
|
|
|
|
|
Second Amended and Restated Bylaws of TransUnion (Incorporated by reference to Exhibit 4.2 to TransUnion’s Registration Statement on Form S-8 filed June 26, 2015).
|
|
|
|
|
|
Form of Stock Certificate for Common Stock (Incorporated by reference to Exhibit 4.6 to TransUnion’s Amendment No. 3 to Registration Statement on Form S-1 filed on June 15, 2015).
|
|
|
|
|
|
Amendment No. 12 to Credit Agreement, dated as of January 31, 2017, by and among TransUnion Intermediate Holdings, Inc., Trans Union LLC, the Guarantors, Deutsche Bank Securities Inc., Capital One, N.A., Goldman Sachs Lending Partners LLC, JPMorgan Chase Bank, N.A. Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Wells Fargo Securities, LLC, as joint lead arrangers, Deutsche Bank AG New York Branch, as administrative agent and collateral agent and each of the lenders party thereto (Incorporated by reference to Exhibit 10.1 to TransUnion’s Current Report on Form 8-K filed on February 6, 2017).
|
|
|
|
|
|
Amendment No. 13 to Credit Agreement, dated as of August 9, 2017, by and among TransUnion Intermediate Holdings, Inc., Trans Union LLC, the Guarantors, Deutsche Bank Securities, Inc., Capital One, N.A., Goldman Sachs Lending Partners LLC, JP Morgan Chase Bank, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Wells Fargo Securities, LLC, as joint lead arrangers, Deutsche Bank AG New York Branch, as administrative agent and collateral agent, and each of the lenders party thereto (incorporated by reference to Exhibit 10.1 to TransUnion’s Quarterly Report on Form 10-Q filed on October 27, 2017).
|
|
|
|
|
|
Third Amended and Restated Credit Agreement, dated as of August 9, 2017, by and among TransUnion Intermediate Holdings, Inc., Trans Union LLC, the guarantors party thereto, Deutsche Bank AG New York Branch, as Administrative Agent and as Collateral Agent, Deutsche Bank AG New York Branch, as L/C Issuer, the other lenders from time to time party thereto and Deutsche Bank Securities, Inc., Capital One, N.A., Goldman Sachs Lending Partners LLC, JP Morgan Chase Bank, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets and Wells Fargo Securities, LLC, as joint lead arrangers and joint bookrunners (Incorporated by reference to Exhibit 10.1 to TransUnion’s Quarterly Report on Form 10-Q filed on October 27, 2017).
|
|
|
|
|
|
Amendment No. 14 to Credit Agreement, dated as of May 2, 2018, by and among TransUnion Intermediate Holdings, Inc. (f/k/a TransUnion Corp.), Trans Union LLC, the Guarantors, Deutsche Bank Securities Inc., Capital One, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated and RBC Capital Markets, as joint lead arrangers, Deutsche Bank AG New York Branch, as administrative agent and collateral agent, and each of the other Lenders party thereto (Incorporated by reference to Exhibit 10.1 to TransUnion’s Quarterly Report on Form 10-Q filed on July 25, 2018).
|
|
|
|
|
|
Amendment No. 15 to Credit Agreement, dated as of June 19, 2018, by and among TransUnion Intermediate Holdings, Inc. (f/k/a TransUnion Corp.), Trans Union LLC, the Guarantors, Deutsche Bank Securities Inc., RBC Capital Markets, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Capital One, N.A., as joint lead arrangers, Deutsche Bank AG New York Branch, as administrative agent and collateral agent, and each of the other Lenders party thereto (Incorporated by reference to Exhibit 10.2 to TransUnion’s Quarterly Report on Form 10-Q filed on July 25, 2018).
|
|
|
|
|
|
Amendment No. 16 to Credit Agreement, dated as of June 29, 2018, by and among TransUnion Intermediate Holdings, Inc. (f/k/a TransUnion Corp.), Trans Union LLC, the Guarantors, Deutsche Bank Securities Inc., RBC Capital Markets, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Capital One, N.A., as joint lead arrangers, Deutsche Bank AG New York Branch, as administrative agent and collateral agent, and each of the other Lenders party thereto (Incorporated by reference to Exhibit 10.3 to TransUnion’s Quarterly Report on Form 10-Q filed on July 25, 2018).
|
|
|
|
|
|
TransUnion Holding Company, Inc. 2012 Management Equity Plan (Effective April 30, 2012) (Incorporated by reference to Exhibit 10.1 to TransUnion’s Registration Statement on Form S-4 filed July 31, 2012).
|
|
|
|
|
|
TransUnion Holding Company, Inc. 2012 Management Equity Plan Stock Option Agreement (Effective April 30, 2012) (Incorporated by reference to Exhibit 10.2 to TransUnion’s Registration Statement on Form S-4 filed July 31, 2012).
|
|
|
|
|
|
Amendment No. 1 to TransUnion Holding Company, Inc. 2012 Management Equity Plan Stock Option Agreement, dated as of January 1, 2016 (Incorporated by reference to Exhibit 10.7 to TransUnion’s Annual Report on Form 10-K for the year ended December 31, 2015).
|
|
|
|
|
|
Stockholders’ Agreement made as of April 30, 2012, among TransUnion, the members of the management or other key persons of TransUnion or of TransUnion Intermediate Holdings, Inc., that are signatories thereto, any other person who becomes a party thereto, and the GS Investors (as defined therein) and the Advent Investor (as defined therein) (for specific purposes) (Incorporated by reference to Exhibit 10.4 to TransUnion’s Registration Statement on Form S-4 filed July 31, 2012).
|
|
|
|
|
|
First Amendment to the Stockholders’ Agreement, dated as of February 12, 2016, among TransUnion, The Advent Investor (as defined therein) and the GS Investor (as defined therein) (Incorporated by reference to Exhibit 10.9 to TransUnion’s Annual Report on Form 10-K for the year ended December 31, 2015).
|
|
|
|
|
|
Second Amendment to the Stockholders’ Agreement, dated as of December 16, 2016, among TransUnion, The Advent Investor (as defined therein) and the GS Investor (as defined therein) (Incorporated by reference to Exhibit 10.13 to TransUnion’s Annual Report on Form 10-K for the year ended December 31, 2016).
|
|
|
|
|
|
Amended and Restated Major Stockholders’ Agreement, dated as of June 23, 2015, among TransUnion, the Advent Investor (as defined therein) and the GS Investors (as defined therein) (Incorporated by reference to Exhibit 10.7 to TransUnion’s Amendment No. 2 to Registration Statement on Form S-1/A filed May 29, 2015).
|
|
|
|
|
|
Registration Rights Agreement dated as of April 30, 2012, by and among TransUnion, the Advent Investors (as defined therein), the GS Investors (as defined therein), certain Key Individuals (as defined therein) and any other person who becomes a party thereto (Incorporated by reference to Exhibit 10.5 to TransUnion’s Registration Statement on Form S-4 filed July 31, 2012).
|
|
|
First Amendment to Registration Rights Agreement, dated March 2, 2016, by and among TransUnion (successor to TransUnion Holding Company, Inc.), the Advent Investor (as defined therein), the GS Investors (as defined therein) and certain Key Individuals (as defined therein) (Incorporated by reference to Exhibit 10.4 to TransUnion’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016).
|
|
|
|
|
|
Form of Director Indemnification Agreement for directors of TransUnion (Incorporated by reference to Exhibit 10.6 to TransUnion’s Registration Statement on Form S-4 filed July 31, 2012).
|
|
|
|
|
|
|
Employment Agreement with James M. Peck, President and Chief Executive Officer of TransUnion and TransUnion Intermediate Holdings, Inc., dated December 6, 2012 (Incorporated by reference to Exhibit 10.15 to TransUnion’s and TransUnion Intermediate Holdings, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2012).
|
|
Letter Agreement between TransUnion and Reed Elsevier with respect to the employment of James M. Peck as the President and Chief Executive Officer of TransUnion and TransUnion Intermediate Holdings, Inc., dated December 6, 2012 (Incorporated by reference to Exhibit 10.16 to TransUnion’s and TransUnion Intermediate Holdings, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2012).
|
|
|
|
|
|
Employment Agreement, dated as of November 13, 2018, by and between TransUnion and Christopher A. Cartwright (Incorporated by reference to Exhibit 10.1 to TransUnion’s Current Report on Form 8-K filed on November 14, 2018).
|
|
|
|
|
|
Employment Agreement, dated as of November 13, 2018, by and between TransUnion and James M. Peck (Incorporated by reference to Exhibit 10.2 to TransUnion’s Current Report on Form 8-K filed on November 14, 2018).
|
|
|
|
|
|
TransUnion 2015 Omnibus Incentive Plan. (Incorporated by reference to Exhibit 4.4 to TransUnion’s Registration Statement on Form S-8 filed June 26, 2015).
|
|
|
|
|
|
TransUnion 2015 Omnibus Incentive Plan Award Agreement with respect to Restricted Stock Units and Performance Share Units (U.S. Employees) (Incorporated by reference to Exhibit 10.2 to TransUnion’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016).
|
|
|
|
|
|
TransUnion 2015 Omnibus Incentive Plan Award Agreement with respect to Restricted Stock (Outside Directors) (Incorporated by reference to Exhibit 10.3 to TransUnion’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016).
|
|
|
|
|
|
TransUnion 2015 Employee Stock Purchase Plan, as Amended and Restated, Effective November 6, 2018.
|
|
|
|
|
|
Consent Order Issued by the United States Consumer Financial Protection Bureau on January 3, 2017, Administrative Proceeding - File No. 2017-CFPB-0002, In the Matter of: TransUnion Interactive, Inc., Trans Union LLC and TransUnion (Incorporated by reference to Exhibit 10.25 to TransUnion’s Annual Report on Form 10-K for the year ended December 31, 2016).
|
|
|
|
|
|
Subsidiaries of TransUnion.
|
|
|
|
|
|
Consent of Ernst & Young LLP.
|
|
|
|
|
|
Power of Attorney - TransUnion (included on the signature page of this Form 10-K).
|
|
|
|
|
|
Certification of Principal Executive Officer for TransUnion pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification of Principal Financial Officer for TransUnion pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification of Chief Executive Officer and Chief Financial Officer for TransUnion pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
101.INS**
|
|
XBRL Instance Document
|
|
|
|
101.SCH**
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL**
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF**
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB**
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE**
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
(4)
|
Valuation and qualifying accounts.
|
(b)
|
Exhibits.
See Item 15(a)(3).
|
(c)
|
Financial Statement Schedules
.
See Item 15(a)(2)
|
TransUnion
|
||
|
|
|
By:
|
|
/s/Todd M. Cello
|
|
|
Todd M. Cello
Executive Vice President and Chief Financial Officer
|
Signature
|
|
Title
|
|
|
|
/s/James M. Peck
|
|
President and Chief Executive Officer, Director
|
James M. Peck
|
|
(Principal Executive Officer)
|
|
|
|
/s/Todd M. Cello
|
|
Executive Vice President and Chief Financial Officer
|
Todd M. Cello
|
|
(Principal Financial Officer)
|
|
|
|
/s/Timothy Elberfeld
|
|
Vice President and Chief Accounting Officer
|
Timothy Elberfeld
|
|
(Principal Accounting Officer)
|
|
|
|
/s/George M. Awad
|
|
Director
|
George M. Awad
|
|
|
|
|
|
/s/ Robert E. Beauchamp
|
|
Director
|
Robert E. Beauchamp
|
|
|
|
|
|
/s/ Suzanne P. Clark
|
|
Director
|
Suzanne P. Clark
|
|
|
|
|
|
/s/ Russell P. Fradin
|
|
Director
|
Russell P. Fradin
|
|
|
|
|
|
/s/ Pamela A. Joseph
|
|
Director
|
Pamela A. Joseph
|
|
|
|
|
|
/s/ Siddharth N. (Bobby) Mehta
|
|
Director
|
Siddharth N. (Bobby) Mehta
|
|
|
|
|
|
/s/ Thomas L. Monahan III
|
|
Director
|
Thomas L. Monahan III
|
|
|
|
|
|
/s/Leo F. Mullin
|
|
Director
|
Leo F. Mullin
|
|
|
|
|
|
/s/ Andrew Prozes
|
|
Director
|
Andrew Prozes
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Other current assets
|
$
|
0.5
|
|
|
$
|
0.1
|
|
Total current assets
|
0.5
|
|
|
0.1
|
|
||
Investment in TransUnion Intermediate
|
1,928.0
|
|
|
1,739.4
|
|
||
Other assets
|
6.8
|
|
|
8.1
|
|
||
Total assets
|
$
|
1,935.3
|
|
|
$
|
1,747.6
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Trade accounts payable
|
$
|
0.3
|
|
|
$
|
—
|
|
Due to TransUnion Intermediate
|
42.6
|
|
|
18.9
|
|
||
Other current liabilities
|
0.5
|
|
|
—
|
|
||
Total current liabilities
|
43.4
|
|
|
18.9
|
|
||
Other liabilities
|
2.2
|
|
|
—
|
|
||
Total liabilities
|
45.6
|
|
|
18.9
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock, $0.01 par value; 1.0 billion shares authorized at December 31, 2018 and December 31, 2017; 190.0 million and 187.4 million shares issued as of December 31, 2018 and December 31, 2017, respectively; and 185.7 million and 183.2 million shares outstanding as of December 31, 2018 and December 31, 2017, respectively
|
1.9
|
|
|
1.9
|
|
||
Additional paid-in capital
|
1,947.3
|
|
|
1,863.5
|
|
||
Treasury stock at cost; 4.2 million shares at December 31, 2018 and December 31, 2017
|
(139.9
|
)
|
|
(138.8
|
)
|
||
Retained earnings
|
363.1
|
|
|
137.4
|
|
||
Accumulated other comprehensive loss
|
(282.7
|
)
|
|
(135.3
|
)
|
||
Total stockholders’ equity
|
1,889.7
|
|
|
1,728.7
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,935.3
|
|
|
$
|
1,747.6
|
|
|
Twelve Months Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Revenue
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Operating expenses
|
|
|
|
|
|
||||||
Selling, general and administrative
|
3.2
|
|
|
2.5
|
|
|
1.8
|
|
|||
Total operating expenses
|
3.2
|
|
|
2.5
|
|
|
1.8
|
|
|||
Operating loss
|
(3.2
|
)
|
|
(2.5
|
)
|
|
(1.8
|
)
|
|||
Non-operating income and expense
|
|
|
|
|
|
||||||
Equity Income from TransUnion Intermediate
|
279.3
|
|
|
448.1
|
|
|
124.3
|
|
|||
Other income and (expense), net
|
(0.4
|
)
|
|
(1.7
|
)
|
|
(2.7
|
)
|
|||
Total non-operating income and expense
|
278.9
|
|
|
446.4
|
|
|
121.6
|
|
|||
Income from continuing operations before income taxes
|
275.7
|
|
|
443.9
|
|
|
119.8
|
|
|||
Benefit (provision) for income taxes
|
0.9
|
|
|
(2.7
|
)
|
|
0.8
|
|
|||
Net income
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
|
|||||||||||
|
Twelve Months Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net income
|
$
|
276.6
|
|
|
$
|
441.2
|
|
|
$
|
120.6
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Foreign currency translation:
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
(145.1
|
)
|
|
32.5
|
|
|
21.3
|
|
|||
Benefit for income taxes
|
—
|
|
|
0.6
|
|
|
2.7
|
|
|||
Foreign currency translation, net
|
(145.1
|
)
|
|
33.1
|
|
|
24.0
|
|
|||
Hedge instruments:
|
|
|
|
|
|
||||||
Net change on interest rate cap
|
7.6
|
|
|
10.1
|
|
|
(12.0
|
)
|
|||
Net change on interest rate swap
|
(10.7
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of accumulated loss
|
—
|
|
|
0.4
|
|
|
0.4
|
|
|||
Benefit (expense) for income taxes
|
0.8
|
|
|
(4.0
|
)
|
|
4.4
|
|
|||
Hedge instruments, net
|
(2.3
|
)
|
|
6.5
|
|
|
(7.2
|
)
|
|||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Net unrealized (loss) gain
|
—
|
|
|
(0.1
|
)
|
|
0.4
|
|
|||
Expense for income taxes
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|||
Available-for-sale securities, net
|
—
|
|
|
(0.1
|
)
|
|
0.2
|
|
|||
Total other comprehensive (loss) income, net of tax
|
(147.4
|
)
|
|
39.5
|
|
|
17.0
|
|
|||
Comprehensive income attributable to TransUnion
|
$
|
129.2
|
|
|
$
|
480.7
|
|
|
$
|
137.6
|
|
|
Twelve Months Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Cash provided by (used in) operating activities
|
$
|
16.6
|
|
|
$
|
106.4
|
|
|
$
|
(11.6
|
)
|
Cash used in investing activities
|
—
|
|
|
—
|
|
|
—
|
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from issuance of common stock and exercise of stock options
|
26.2
|
|
|
27.1
|
|
|
6.0
|
|
|||
Dividends to stockholders
|
(41.6
|
)
|
|
—
|
|
|
—
|
|
|||
Treasury stock purchased
|
—
|
|
|
(133.5
|
)
|
|
(0.7
|
)
|
|||
Excess tax benefit
|
—
|
|
|
—
|
|
|
6.3
|
|
|||
Other
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
|||
Cash (used in) provided by financing activities
|
(16.6
|
)
|
|
(106.4
|
)
|
|
11.6
|
|
|||
Net change in cash and cash equivalents
|
—
|
|
|
—
|
|
|
—
|
|
|||
Cash and cash equivalents, beginning of period
|
—
|
|
|
—
|
|
|
—
|
|
|||
Cash and cash equivalents, end of period
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(in millions)
|
Balance at
Beginning of
Year
|
|
Charged to
Costs and
Expenses
|
|
Charged to
Other
Accounts
|
|
Deductions
(1)
|
|
Balance at
End of
Year
|
||||||||||
Allowance for doubtful accounts:
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 31,
|
|
|
|
|
|
|
|
|
|
||||||||||
2018
|
$
|
9.9
|
|
|
$
|
4.6
|
|
|
$
|
—
|
|
|
$
|
(1.0
|
)
|
|
$
|
13.5
|
|
2017
|
$
|
6.2
|
|
|
$
|
5.1
|
|
|
$
|
—
|
|
|
$
|
(1.4
|
)
|
|
$
|
9.9
|
|
2016
|
$
|
4.2
|
|
|
$
|
4.3
|
|
|
$
|
—
|
|
|
$
|
(2.3
|
)
|
|
$
|
6.2
|
|
Allowance for deferred tax assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 31,
|
|
|
|
|
|
|
|
|
|
||||||||||
2018
|
$
|
85.3
|
|
|
$
|
5.3
|
|
|
$
|
—
|
|
|
$
|
(38.7
|
)
|
|
$
|
51.9
|
|
2017
|
$
|
59.2
|
|
|
$
|
45.1
|
|
|
$
|
—
|
|
|
$
|
(19.0
|
)
|
|
$
|
85.3
|
|
2016
|
$
|
46.7
|
|
|
$
|
13.6
|
|
|
$
|
—
|
|
|
$
|
(1.1
|
)
|
|
$
|
59.2
|
|
(1)
|
For the allowance for doubtful accounts, includes write-offs of uncollectable accounts.
|
ARTICLE I
|
- PURPOSE
|
ARTICLE II
|
- DEFINITIONS
|
ARTICLE III
|
-SHARES OF COMMON STOCK
|
ARTICLE VI
|
- PAYROLL DEDUCTIONS AND OTHER APPROVED FORMS OF PAYMENT
|
ARTICLE VIII
|
- EXCERISE OF RIGHTS TO PURCHASE COMMON STOCK
|
ARTICLE X
|
- ADMINISTRATION
|
ARTICLE XI
|
- MISCELLANEOUS
|
Subsidiary
|
Jurisdiction of Organization
|
Diversified Data Development Corporation
|
CA
|
Credit Bureau of Carmel & Pebble Beach, Inc.
|
CA
|
TransUnion Intermediate Holdings, Inc.
|
DE
|
TransUnion Risk and Alternative Data Solutions, Inc.
|
DE
|
TransUnion Digital LLC
|
DE
|
Trans Union LLC
|
DE
|
Trans Union International, Inc.
|
DE
|
TransUnion International Holdings LLC
|
DE
|
TransUnion Exchange LLC
|
DE
|
TransUnion Rental Screening Solutions, Inc.
|
DE
|
Credit Retriever LLC
|
DE
|
Verifacts LLC
|
DE
|
INSDEC LLC
|
DE
|
TransUnion Consumer Solutions LLC
|
DE
|
Trans Union Content Solutions LLC
|
DE
|
TransUnion Interactive, Inc.
|
DE
|
Trans Union Real Estate Services, Inc.
|
DE
|
TransUnion Financing Corporation
|
DE
|
TransUnion Risk Advisory, Inc.
|
DE
|
L2C, Inc.
|
DE
|
Link Marketing, Inc.
|
DE
|
Link2credit, Inc.
|
DE
|
Driver’s History Information Sales LLC
|
DE
|
TransUnion Data Solutions LLC
|
DE
|
Auditz, LLC
|
DE
|
eBureau, LLC
|
DE
|
IS Resources, Inc.
|
DE
|
FT Holdings, Inc.
|
DE
|
FactorTrust, Inc.
|
DE
|
iovation, Inc.
|
DE
|
TransUnion Healthcare Holdings, Inc.
|
DE
|
Healthcare Payment Specialists, LLC
|
DE
|
Recipero, Inc.
|
DE
|
Rubixis, Inc.
|
DE
|
Visionary Systems, Inc.
|
GA
|
Worthknowing, Inc.
|
GA
|
Decision Systems, Inc.
|
GA
|
Source USA Insurance Agency, Inc.
|
IL
|
TransUnion Marketing Solutions, Inc.
|
IL
|
Driver’s History Inc.
|
NJ
|
Datalink Services, Inc.
|
NV
|
TransUnion Intelligence LLC
|
NV
|
RTech Healthcare Revenue Technologies, Inc.
|
NY
|
TransUnion Teledata LLC
|
OR
|
Title Insurance Services Corporation
|
SC
|
TransUnion Healthcare, Inc.
|
TX
|
Credit Reference Bureau Africa (Pty) Ltd.
|
Botswana
|
TransUnion (Proprietary) Ltd.
|
Botswana
|
TransUnion Brasil Sistemas em Informatica Ltda.
|
Brazil
|
Moussoro Participacoes Ltda.
|
Brazil
|
Trans Union of Canada, Inc.
|
Canada
|
Trans Union Chile, S.A.
|
Chile
|
TransUnion Soluciones de Informacion Chile SA
|
Chile
|
TransUnion Information Technology Ltd.
|
China
|
GMAP Marketing Consulting Shangahi Co. Ltd
|
China
|
TransUnion Colombia Ltda.
|
Colombia
|
Central de Information Financiera, S.A.
|
Colombia
|
Trans Union Costa Rica, S.A.
|
Costa Rica
|
Centro de Informacion y Estudios Estrategicos Empresariales S.A.
|
Dominican Rep.
|
TransUnion S.A.
|
Dominican Rep.
|
Centro de Operaciones y Servicios de Informacion Estrategica, S.A.
|
Dominican Rep.
|
TransUnion El Salvador, S.A. de C.V.
|
El Salvador
|
Trans Union Guatemala, S.A.
|
Guatemala
|
Soluciones de Informatica de Centroamerica (SICE), S.A.
|
Guatemala
|
Trans Union Honduras Buro de Credito, S.A.
|
Honduras
|
TransUnion Limited
|
Hong Kong
|
TransUnion Asia Ltd.
|
Hong Kong
|
TransUnion Information Services Limited
|
Hong Kong
|
Credit Information Services Limited
|
Hong Kong
|
Trans Union Software Services Private Limited
|
India
|
TransUnion CIBIL Limited
|
India
|
TransUnion Global Technology Center LLP
|
India
|
Rubixis Technologies Private Limited
|
India
|
TransUnion Innovation Limited
|
Ireland
|
Trustev Limited
|
Ireland
|
GMAP Japan KK
|
Japan
|
TransUnion Kenya Limited
|
Kenya
|
Credit Reference Bureau (Holdings) Limited
|
Kenya
|
Regional Data Systems Limited
|
Kenya
|
Credit Information Systems Company Limited
|
Kenya
|
Credit Reference Bureau Africa Ltd.
|
Kenya
|
Callcredit Operations UAB
|
Lithuania
|
Credit Reference Bureau Africa Ltd.
|
Malawi
|
Credit Reference Bureau Africa Ltd.
|
Mauritius
|
Collection Africa Ltd.
|
Mauritius
|
TransUnion (Mauritius) Limited
|
Mauritius
|
STS Vail Beheeren Administracion S. DE. R.L. DE C.V.
|
Mexico
|
TransUnion Reverse Exchange S de R.L. de C.V.
|
Mexico
|
TransUnion Soluciones de Informacion, S de R.L de C.V.
|
Mexico
|
TransUnion Credit Bureau Namibia (Pty) Ltd.
|
Namibia
|
Beheer en Beleggingsmaatchapij Stivaco B.V.
|
Netherlands
|
Vail Systemen Groep, B.V.
|
Netherlands
|
TransUnion Netherlands I, B.V.
|
Netherlands
|
TransUnion Netherlands II, B.V.
|
Netherlands
|
Recipero Access B.V.
|
Netherlands
|
TransUnion Nicaragua, S.A.
|
Nicaragua
|
Trans Union Central America, S.A.
|
Panama
|
TransUnion Information Solutions, Inc.
|
Philippines
|
Trans Union de Puerto Rico, Inc.
|
Puerto Rico
|
TransUnion Rwanda Ltd.
|
Rwanda
|
TransUnion Africa Holdings (Pty) Ltd.
|
South Africa
|
TransUnion Credit Bureau (Pty) Ltd.
|
South Africa
|
TransUnion Africa (Pty) Ltd.
|
South Africa
|
TransUnion Analytic and Decision Services (Pty) Ltd.
|
South Africa
|
TransUnion Auto Information Solutions (Pty) Ltd.
|
South Africa
|
Autolocator (Pty) Ltd.
|
South Africa
|
Callcredit Spain SLU
|
Spain
|
Confirma Sistemas de Informacion S.L.
|
Spain
|
TransUnion ITC (Pty) Ltd.
|
Swaziland
|
Credit Reference Bureau Africa Ltd.
|
Tanzania
|
Collection Africa Ltd.
|
Tanzania
|
Credit Reporting Services Limited
|
Trinidad & Tobago
|
Collection Africa Ltd.
|
Uganda
|
LendProtect UK Limited
|
United Kingdom
|
iovation, Ltd.
|
United Kingdom
|
Vail Holdings UK Ltd
|
United Kingdom
|
Crown Acquisition TopCo, Ltd.
|
United Kingdom
|
Crown Acquisition MidCo, Ltd.
|
United Kingdom
|
Crown Acquisition MidCo 2, Ltd.
|
United Kingdom
|
Crown Acquisition BidCo, Ltd.
|
United Kingdom
|
DMWSL 617 Ltd.
|
United Kingdom
|
DMWSL 618 Ltd.
|
United Kingdom
|
DMWSL 619 Ltd.
|
United Kingdom
|
DMWSL 620 Ltd.
|
United Kingdom
|
Call Credit Information Group, Ltd.
|
United Kingdom
|
Crown Acquisition Consumer Ltd.
|
United Kingdom
|
1)
|
Registration Statement (Form S-3 No. 333-213542) of TransUnion,
|
2)
|
Registration Statement (Form S-8 No. 333-207090) pertaining to the TransUnion Holding Company, Inc. 2012 Management Equity Plan of TransUnion, and
|
3)
|
Registration Statement (Form S-8 No. 333-205239) pertaining to the TransUnion 2015 Omnibus Incentive Plan and the TransUnion 2015 Employee Stock Purchase Plan;
|
|
|
|
/s/James M. Peck
|
||
Name:
|
|
James M. Peck
|
Title:
|
|
Principal Executive Officer
|
|
|
|
/s/Todd M. Cello
|
||
Name:
|
|
Todd M. Cello
|
Title:
|
|
Principal Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
/s/James M. Peck
|
||
Name:
|
|
James M. Peck
|
Title:
|
|
Chief Executive Officer
|
|
||
Date: February 14, 2019
|
||
|
||
/s/Todd M. Cello
|
||
Name:
|
|
Todd M. Cello
|
Title:
|
|
Chief Financial Officer
|