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Adjusted earnings (excluding 75 cents from non-recurring items) came in at $1.81 per share, beating the Zacks Consensus Estimate by 4% and increasing 19.1% from the year-ago figure.
Total revenues of $1.33 billion beat the consensus estimate by 1.1% and increased 10.7% from the year-ago figure on a reported basis and 14% on a local currency basis.
Revenues in the Workforce Solutions segment totaled $559.5 million, up 10% from the year-ago quarter’s figure and beating our estimated $551.2 million. Within the segment, Verification Services’ revenues of $457.1 million increased 15% year over year. Employer Services’ revenues of $102.4 million indicate a 7% year-over-year decline.
Revenues in the USIS segment were $427.7 million, up 5% from the year-ago quarter’s level and beating our estimated $422.2 million. Within the segment, Online Information Solutions’ revenues of $327.5 million were up 6% from the year-ago quarter’s figure. Mortgage Solutions’ revenues of $22.9 million declined 12% year over year. Financial Marketing Services’ revenues were $77.3 million, which increased 7% year over year.
Revenues in the International division totaled $339.3 million, gaining 20% and 22% year over year on a reported basis and a local-currency basis, respectively. Asia Pacific revenues of $82.2 million declined 3% from the year-ago reported figure on a reported basis and 2% on a local-currency basis.
Revenues from Europe amounted to $93.6 million, up 15% year over year on a reported basis and 9% on a local currency basis. Latin America revenues of $98.6 million grew 85% year over year on a reported basis and more than 100% on a local-currency basis. Canada revenues of $64.9 million were up 1% year over year, both on a reported basis and a local-currency basis.
Operating Results
Adjusted EBITDA in the fourth quarter of 2023 totaled $446.6 million, reflecting a 20% increase from the year-ago quarter’s level. Adjusted EBITDA margin was 33.7%, which increased 260 basis points from the year-ago reported figure.
Workforce Solutions’ adjusted EBITDA margin was 51.2% compared with 46.8% a year ago. Adjusted EBITDA margin for the USIS division was 35.1% compared with 35.3% in the year-ago quarter. Adjusted EBITDA margin for the International segment was 31.2% compared with 25.8% in the year-ago quarter.
Balance Sheet & Cash Flow
EFX exited the fourth quarter with cash and cash equivalents of $216.8 million. Equifax generated $322.1 million in cash from operating activities in the quarter. The company has a long-term debt of $4.74 billion, down from the quarter-ago reported figure of $5.5 billion. Capital expenditures were $145.7 million. The company distributed $48.1 million as dividends during the quarter.
Q1 and 2024 Outlook
For the first quarter of 2024, revenues are expected to be in the $1.375-$1.395 billion band. The Zacks Consensus Estimate for revenues is pegged at $1.41 billion, which lies above the guided range. Adjusted earnings per share (EPS) are expected to be in the range of $1.33-$1.43 while the consensus estimate of EPS is $1.81, which is more than the guided range.
For 2024, revenues are expected in the range of $5.67-$5.77 billion. The Zacks Consensus Estimate of $5.74 billion lies above the midpoint ($5.72 billion) of the guided range. Adjusted EPS is expected to be in the range of $7.2-$7.5. The consensus mark for earnings is pegged at $8.11 per share, which lies above the guided range.
Earnings Snapshot of Some Business Services Stocks
Automatic Data Processing, Inc. (ADP - Free Report) reported impressive second-quarter fiscal 2024 results, wherein earnings and revenues beat the respective Zacks Consensus Estimate.
Adjusted EPS of $2.13 beat the consensus estimate by 1.4% and grew 8.7% from the year-ago fiscal quarter’s figure. Total revenues of $4.67 billion surpassed the consensus estimate by 0.2% and improved 6.3% from the year-ago fiscal quarter’s reading on a reported basis as well on an organic constant-currency basis.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported better-than-expected third-quarter fiscal 2024 results.
Quarterly adjusted EPS of $1.41 surpassed the Zacks Consensus Estimate by 24.8% and exceeded the year-ago quarter by 31.8%. The company reported revenues of $2.57 billion, which beat the consensus estimate by 1.5% and increased 12.9% year over year. Revenues, excluding billable expenses, were $1.77 billion, up 13% year over year.
ManpowerGroup Inc. (MAN - Free Report) reported impressive fourth-quarter 2023 results, with earnings and revenues beating the Zacks Consensus Estimate. The better-than-expected earnings failed to impress the investors as the stock prices have stayed unchanged since the earnings release on Jan 30.
Quarterly adjusted earnings of $1.45 per share surpassed the consensus mark by 19.8%. The bottom line, however, declined 30.3% year over year, mainly due to restructuring costs and Argentina-related non-cash currency translation losses. Revenues of $4.63 billion surpassed the consensus mark by 1.5% and dipped 3.7% year over year on a reported basis. Revenues fell 5% on a constant-currency basis.
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Equifax (EFX) Q4 Earnings and Revenues Surpass Estimates
Equifax Inc. (EFX - Free Report) reported better-than-expected fourth-quarter 2023 results.
Adjusted earnings (excluding 75 cents from non-recurring items) came in at $1.81 per share, beating the Zacks Consensus Estimate by 4% and increasing 19.1% from the year-ago figure.
Total revenues of $1.33 billion beat the consensus estimate by 1.1% and increased 10.7% from the year-ago figure on a reported basis and 14% on a local currency basis.
Equifax, Inc. Price, Consensus and EPS Surprise
Equifax, Inc. price-consensus-eps-surprise-chart | Equifax, Inc. Quote
Segmental Information
Revenues in the Workforce Solutions segment totaled $559.5 million, up 10% from the year-ago quarter’s figure and beating our estimated $551.2 million. Within the segment, Verification Services’ revenues of $457.1 million increased 15% year over year. Employer Services’ revenues of $102.4 million indicate a 7% year-over-year decline.
Revenues in the USIS segment were $427.7 million, up 5% from the year-ago quarter’s level and beating our estimated $422.2 million. Within the segment, Online Information Solutions’ revenues of $327.5 million were up 6% from the year-ago quarter’s figure. Mortgage Solutions’ revenues of $22.9 million declined 12% year over year. Financial Marketing Services’ revenues were $77.3 million, which increased 7% year over year.
Revenues in the International division totaled $339.3 million, gaining 20% and 22% year over year on a reported basis and a local-currency basis, respectively. Asia Pacific revenues of $82.2 million declined 3% from the year-ago reported figure on a reported basis and 2% on a local-currency basis.
Revenues from Europe amounted to $93.6 million, up 15% year over year on a reported basis and 9% on a local currency basis. Latin America revenues of $98.6 million grew 85% year over year on a reported basis and more than 100% on a local-currency basis. Canada revenues of $64.9 million were up 1% year over year, both on a reported basis and a local-currency basis.
Operating Results
Adjusted EBITDA in the fourth quarter of 2023 totaled $446.6 million, reflecting a 20% increase from the year-ago quarter’s level. Adjusted EBITDA margin was 33.7%, which increased 260 basis points from the year-ago reported figure.
Workforce Solutions’ adjusted EBITDA margin was 51.2% compared with 46.8% a year ago. Adjusted EBITDA margin for the USIS division was 35.1% compared with 35.3% in the year-ago quarter. Adjusted EBITDA margin for the International segment was 31.2% compared with 25.8% in the year-ago quarter.
Balance Sheet & Cash Flow
EFX exited the fourth quarter with cash and cash equivalents of $216.8 million. Equifax generated $322.1 million in cash from operating activities in the quarter. The company has a long-term debt of $4.74 billion, down from the quarter-ago reported figure of $5.5 billion. Capital expenditures were $145.7 million. The company distributed $48.1 million as dividends during the quarter.
Q1 and 2024 Outlook
For the first quarter of 2024, revenues are expected to be in the $1.375-$1.395 billion band. The Zacks Consensus Estimate for revenues is pegged at $1.41 billion, which lies above the guided range. Adjusted earnings per share (EPS) are expected to be in the range of $1.33-$1.43 while the consensus estimate of EPS is $1.81, which is more than the guided range.
For 2024, revenues are expected in the range of $5.67-$5.77 billion. The Zacks Consensus Estimate of $5.74 billion lies above the midpoint ($5.72 billion) of the guided range. Adjusted EPS is expected to be in the range of $7.2-$7.5. The consensus mark for earnings is pegged at $8.11 per share, which lies above the guided range.
Equifax currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot of Some Business Services Stocks
Automatic Data Processing, Inc. (ADP - Free Report) reported impressive second-quarter fiscal 2024 results, wherein earnings and revenues beat the respective Zacks Consensus Estimate.
Adjusted EPS of $2.13 beat the consensus estimate by 1.4% and grew 8.7% from the year-ago fiscal quarter’s figure. Total revenues of $4.67 billion surpassed the consensus estimate by 0.2% and improved 6.3% from the year-ago fiscal quarter’s reading on a reported basis as well on an organic constant-currency basis.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported better-than-expected third-quarter fiscal 2024 results.
Quarterly adjusted EPS of $1.41 surpassed the Zacks Consensus Estimate by 24.8% and exceeded the year-ago quarter by 31.8%. The company reported revenues of $2.57 billion, which beat the consensus estimate by 1.5% and increased 12.9% year over year. Revenues, excluding billable expenses, were $1.77 billion, up 13% year over year.
ManpowerGroup Inc. (MAN - Free Report) reported impressive fourth-quarter 2023 results, with earnings and revenues beating the Zacks Consensus Estimate. The better-than-expected earnings failed to impress the investors as the stock prices have stayed unchanged since the earnings release on Jan 30.
Quarterly adjusted earnings of $1.45 per share surpassed the consensus mark by 19.8%. The bottom line, however, declined 30.3% year over year, mainly due to restructuring costs and Argentina-related non-cash currency translation losses. Revenues of $4.63 billion surpassed the consensus mark by 1.5% and dipped 3.7% year over year on a reported basis. Revenues fell 5% on a constant-currency basis.