The table below summarizes our selected historical financial information for each of the last five years. The summary of operations data for the years ended December 31, 2018, 2017, and 2016, and the balance sheet data as of December 31, 2018 and 2017, have been derived from our audited Consolidated Financial Statements included in this report. The summary of operations data for the years ended December 31, 2015 and 2014, and the balance sheet data as of December 31, 2016, 2015 and 2014, have been derived from our audited Consolidated Financial Statements not included in this report. The historical selected financial information may not be indicative of our future performance and should be read in conjunction with the information contained in Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the Consolidated Financial Statements and the accompanying Notes to the Consolidated Financial Statements in this report.
Twelve Months Ended December 31,
2018 (1) (2)
2017 (3) (4)
2016 (5)
2015 (6) (7)
2014 (8)
(In millions, except per share data)
Summary of Operations:
Operating revenue
$
3,412.1
$
3,362.2
$
3,144.9
$
2,663.6
$
2,436.4
Operating expenses
2,964.1
2,530.5
2,319.8
1,963.6
1,794.5
Operating income
448.0
831.7
825.1
700.0
641.9
Consolidated income from continuing operations
306.3
598.0
495.1
434.8
374.0
Net income attributable to Equifax
$
299.8
$
587.3
$
488.8
$
429.1
$
367.4
Dividends paid to Equifax shareholders
$
187.9
$
187.4
$
157.6
$
137.8
$
121.2
Diluted earnings per share
Net income attributable to Equifax
$
2.47
$
4.83
$
4.04
$
3.55
$
2.97
Cash dividends declared per share
$
1.56
$
1.56
$
1.32
$
1.16
$
1.00
Weighted-average shares outstanding (diluted)
121.4
121.5
121.1
120.9
123.5
As of December 31,
2018 (1) (2)
2017 (3) (4)
2016 (5)
2015 (6) (7)
2014 (8)
(In millions)
Balance Sheet Data:
Total assets
$
7,153.2
$
7,233.4
$
6,664.0
$
4,501.5
$
4,661.0
Short-term debt and current maturities
4.9
965.3
585.4
49.3
380.4
Long-term debt, net of current portion
2,630.6
1,739.0
2,086.8
1,138.4
1,145.7
Total debt, net
2,635.5
2,704.3
2,672.2
1,187.7
1,526.1
Total equity
3,155.7
3,239.0
2,721.3
2,350.4
2,234.6
(1)
During the year ended December 31, 2018, the Company recorded $401.2 million of pre-tax expenses related to the 2017 cybersecurity incident and insurance recoveries of $75.0 million for net expenses of $326.2 million. Costs related to the 2017 cybersecurity incident are defined as incremental costs to transform our information technology infrastructure and data security; legal fees and professional services costs to investigate the 2017 cybersecurity incident and respond to legal, government and regulatory claims; as well as costs to provide the free product and related support to the consumer.
(2)
During the fourth quarter of 2018, we recorded a restructuring charge of $46.1 million all of which is recorded in selling, general, and administrative expenses in our Consolidated Statements of Income. The restructuring charge primarily relates to a reduction in headcount to support the Company’s strategic objectives and increase the integration of our global operations. For additional information, see Note 11 of the Notes to the Consolidated Financial Statements in this report.
(3)
During the year ended December 31, 2017, the Company recorded $164.0 million of pre-tax expenses related to the 2017 cybersecurity incident and insurance recoveries of $50.0 million for net expenses of $114.0 million. Expenses include costs to investigate and remediate the 2017 cybersecurity incident and legal and other professional services related thereto, all of which were expensed as incurred. Additionally, as a result of the 2017 cybersecurity incident, we offered free credit file monitoring and identity theft protection to all U.S. consumers. We recorded the expenses necessary to provide this service to those who signed up during 2017. For additional information, see Note 6 of the Notes to the Consolidated Financial Statements in this report.
(4)
The Tax Cuts and Jobs Act of 2017 (“Tax Act”), as signed by the President of the United States on December 22, 2017, significantly revised U.S. tax law. The legislation positively impacted the Company’s ongoing effective tax rate due to the reduction of the U.S. federal corporate tax rate from 35% to 21%. The Tax Act made major changes to the U.S. international tax system. Under previous law, foreign earnings were subject to U.S. tax when repatriated to the U.S. Under the Tax Act, foreign earnings are generally exempt from U.S. tax. Additionally, there is a one-time deemed repatriation tax on undistributed foreign earnings and profits (the “transition tax”). The Tax Act imposes other U.S. taxes on “global intangible low taxed income” and “base erosion anti-abuse transactions.” Other significant changes included limitations on the deductibility of interest expense and executive compensation, and repeal of the deduction for domestic production activities. As a result of the current interpretation and estimated impact of the Tax Act, the Company recorded adjustments totaling a net tax benefit of $48.3 million in the fourth quarter of 2017 to provisionally account for the estimated impact. Refer to Note 7 of the Notes to the Consolidated Financial Statements in this Form 10-K for additional information. We also prospectively applied the provisions of ASU 2016-09 “Compensation - Stock Compensation (Topic 718),” related to the recognition of windfall tax benefits in the Consolidated Statement of Income which resulted in the recognition of $26.7 million of tax benefits for the year ended December 31, 2017.
(5)
In the first quarter of 2016, we completed the acquisition of 100% of the ordinary voting shares of Veda for cash consideration plus debt assumed of approximately $1.9 billion. For the year ended December 31, 2016, we recorded $40.2 million ($28.2 million, net of tax) for Veda acquisition related amounts. Of this amount, $30.1 million relates to transaction and integration costs in operating income, $9.2 million is recorded in other income and is the impact of foreign currency changes on the transaction structure, including the economic hedges, $0.2 million is recorded in depreciation and amortization, and $0.7 million is recorded in interest expense.
(6)
In the first quarter of 2015, we recorded a $20.7 million restructuring charge ($13.2 million, net of tax) all of which was recorded in selling, general and administrative expenses on our Consolidated Statements of Income. This charge resulted from our continuing efforts to realign our internal resources to support the Company’s strategic objectives and increase the integration of our global operations.
(7)
During the second quarter of 2015, the management of Boa Vista Servicos S.A. (“BVS”), in which we hold a 15% cost method investment, updated the financial projections of BVS. The updated projections, along with the continued weakness in the Brazilian consumer and small commercial credit markets were considered indicators of impairment. As a result of these changes, and the associated near-term changes in cash flow expected from the business, we recorded a 46.0 million Brazilian Reais ($14.8 million) impairment of our investment.
(8)
During the first quarter of 2014, we acquired 100% of the stock of TDX, a data, technology and services company in the United Kingdom that specializes in debt collections and recovery management through the use of analytics, data exchanges and technology platforms. The results of this acquisition have been included in our USIS and International operating segments subsequent to the acquisition.
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