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TransUnion Reports Second Quarter 2011 Results

CHICAGO, IL--(Marketwire - Aug 8, 2011) - TransUnion Corp ("TransUnion," or the "Company") today announced financial results for the quarter ended June 30, 2011. The Company reported revenue of $257.5 million for the second quarter, an increase of 8.5 percent compared to the second quarter of 2010. Of this increase, 1.4 percent was due to the impact of strengthening foreign currencies. Operating income was $60.5 million, an increase of 49.0 percent compared to the second quarter of 2010.(1) Net income from continuing operations attributable to TransUnion Corp. for the second quarter of 2011 was $23.2 million compared to a net loss of $27.0 million for the second quarter of 2010, an increase of $50.2 million. The increases to operating income and net income from continuing operations attributable to TransUnion Corp. were primarily due to expenses incurred in the second quarter of 2010 relating to the change in control transaction.(2)

Adjusted EBITDA for the quarter was $91.2 million, an increase of 5.3 percent compared to the second quarter of 2010, with a corresponding margin of 35.4 percent for the second quarter of 2011 compared to 36.5 percent for the second quarter of 2010.(2)

"TransUnion continues to show revenue increases across all of our business segments," said Bobby Mehta, President and Chief Executive Officer. "Business performance in the second quarter was highlighted by growth in core financial services markets and key industry segments within USIS, the emerging markets portion of our International segment and the Interactive segment as a whole, as the demand for credit marketing and online services and consumer credit monitoring services continued to improve."

Second Quarter 2011 Results

  • Total revenue increased 8.5 percent compared to the second quarter of 2010;
    • Revenue in USIS Credit Marketing Services increased 17.5 percent compared to the second quarter in 2010;
    • Revenue in International emerging markets increased 24.8 percent compared to the second quarter in 2010; and
    • Revenue in the Interactive segment increased 23.1 percent compared to the second quarter in 2010.
  • Adjusted EBITDA increased 5.3 percent compared to the second quarter of 2010, with a corresponding margin of 35.4 percent for the second quarter of 2011 compared to 36.5 percent for the second quarter of 2010.(1)(2)

 

Segment Highlights

U.S. Information Services (USIS)

Total USIS revenue was $165.7 million, an increase of 3.7 percent compared to the second quarter of 2010.

  • Online Data Services revenue was $113.2 million, an increase of 1.4 percent compared to the second quarter of 2010;
  • Credit Marketing Services revenue was $32.3 million, an increase of 17.5 percent compared to the second quarter of 2010; and
  • Decision Services revenue was $20.2 million, a decrease of 2.4 percent compared to the second quarter of 2010, due to a decrease in financial services revenue partially offset by an increase in healthcare eligibility revenue.

 

Operating income for USIS was $42.3 million for the second quarter of 2011 compared to $37.4 million for the second quarter of 2010.(1)

International

Total International revenue was $54.5 million, an increase of 15.2 percent compared to the second quarter of 2010. Of this increase, 7.4 percent was due to the impact of strengthening foreign currencies.

  • Developed markets revenue was $22.8 million, an increase of 4.1 percent compared to the second quarter of 2010. Of this increase, 5.1 percent was due to the impact of strengthening foreign currencies; and
  • Emerging markets revenue was $31.7 million, an increase of 24.8 percent compared to the second quarter of 2010. Of this increase, 9.4 percent was due to the impact of strengthening foreign currencies and 8.2 percent was due to revenue from our recent acquisition in Chile.

 

Operating income for International was $16.4 million for the second quarter of 2011 compared to $14.7 million for the second quarter of 2010.(1)

Interactive

Total Interactive revenue was $37.3 million, an increase of 23.1 percent compared to the second quarter of 2010.

Operating income for Interactive was $14.7 million for the second quarter of 2011 compared to $8.5 million for the second quarter of 2010.(1)

2011 Year to Date Results

Total revenue for the six months ended June 30, 2011, was $503.4 million, an increase of 8.4 percent compared to the same period in 2010. Of this increase, 1.2 percent was due to the impact of strengthening foreign currencies. Operating income was $115.6 million, an increase of 33.3 percent compared to the same period in 2010.(1) The net loss from continuing operations attributable to TransUnion Corp. for the six months ended June 30, 2011, was $2.1 million compared to a net loss of $2.0 million for the same period in 2010. The loss for the six months ended June 30, 2010, was primarily due to the change in control related expenses incurred in the second quarter of 2010, while the loss for the six months ended June 30, 2011, was primarily due to the loss on the early extinguishment of debt resulting from the refinancing of our senior secured credit facility in the first quarter of 2011.(2)

Adjusted EBITDA for the six months ended June 30, 2011, was $170.5 million, an increase of 8.1 percent compared to the same period in 2010, with a corresponding margin of 33.9 percent for 2011 compared to 34.0 percent for the same period in 2010.(2)

Selected Liquidity Data

Total cash and cash equivalents at June 30, 2011, was $122.8 million, down $8.4 million from $131.2 million at December 31, 2010. Year-to-date cash provided by operating activities of continuing operations was $57.6 million. Other key cash activity included: $38.9 million used for cash capital expenditures, including $18.8 million paid in the first quarter of 2011 for assets purchased and accrued for in the fourth quarter of 2010; $16.0 million in costs related to refinancing our senior secured credit facility net of new proceeds; $7.0 million of scheduled debt repayments; $4.2 million to purchase the remaining 20% interest in one of our South African subsidiaries; and net other inflows of $0.1 million.

(1) See page 9 for a discussion on the impact certain items had on consolidated and segment operating income.
(2) See page 10 for a further discussion on the change in control related expenses in 2010, the loss on the early extinguishment of debt resulting from the refinancing of our senior secured credit facility in 2011and the reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, net income (loss) attributable to TransUnion Corp.

About TransUnion (www.transunion.com)

TransUnion is a leading global provider of information and risk management solutions to businesses across multiple industries and to individual consumers. The Company's technology and services enable businesses to make more timely and informed credit granting, risk management, underwriting, fraud protection and customer acquisition decisions by delivering high quality data, and by integrating advanced analytics and enhanced decision-making capabilities. TransUnion's interactive website provides consumers with real-time access to their personal credit information and analytical tools that help them understand and proactively manage their personal finances. Through these and other efforts, TransUnion is working to build stronger economies worldwide. Founded in 1968 and headquartered in Chicago, TransUnion provides services in 23 countries on five continents. www.transunion.com/business.

Earnings Conference Call

In conjunction with this release, TransUnion will host a conference call today, August 8, 2011, at 8:00 a.m. (CDT) via a live teleconference to discuss the business trends supporting second quarter 2011 and year-to-date financial results. To access the teleconference, go to TransUnion's homepage at http://www.transunion.com. The discussion will be available via replay at the same site shortly after the teleconference. This earnings release is also available on that website. The teleconference dial-in information is:

Domestic dial-in: 866-770-7051 International dial-in: 617-213-8064
Teleconference code: 15990197

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Any statements made in this press release that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include information concerning possible or assumed future results of operations, including descriptions of our business plans and strategies. These statements often include words such as "anticipate," "expect," "suggest," "plan," "believe," "intend," "estimate," "target," "project," "forecast," "should," "could," "would," "may," "will" and other similar expressions.

We base these forward-looking statements on our current expectations, plans and assumptions that we have made in light of our experience in the industry, as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances and at the time such statements were made. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those expressed in the forward-looking statements. Factors that may materially affect such forward-looking statements include: macroeconomic and industry trends and adverse developments in the debt, consumer credit and financial services markets; our ability to maintain the security and integrity of our data; our ability to deliver services timely without interruption; our ability to maintain our access to data sources; government regulation and changes in the regulatory environment; litigation or regulatory proceedings; our ability to effectively develop and maintain strategic alliances and joint ventures; our ability to make acquisitions and integrate the operations of other businesses; our ability to timely develop new services; our ability to manage and expand our operations and keep up with rapidly changing technologies; our ability to manage expansion of our business into international markets; economic and political stability in international markets where we operate; our ability to effectively manage our costs; our ability to provide competitive services and prices; our ability to make timely payments of principal and interest on our indebtedness; our ability to satisfy covenants in the agreements governing our indebtedness; our ability to maintain our liquidity; our ability to protect our intellectual property; our ability to retain or renew existing agreements with long-term customers; our ability to access the capital markets; further consolidation in our end customer markets; reliance on key management personnel; and other factors described under "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Registration Statement on Form S-4 and the section titled "Management's discussion and analysis of financial condition and results of operations" of our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2011. Many of these factors are beyond our control. The forward-looking statements contained in this press release speak only as of the date of this press release. We undertake no obligation to publicly release the result of any revisions to these forward-looking statements, to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.

 

                    TRANSUNION CORP. AND SUBSIDIARIES
                        Consolidated Balance Sheets
                   (in millions, except per share data)


                                                  June 30,    December 31,
                                                    2011          2010
                                                ------------  ------------
                                                (Unaudited)
Assets
Current assets:
    Cash and cash equivalents                   $      122.8  $      131.2
    Short-term marketable securities                     6.2             -
    Trade accounts receivable, net of allowance
     of $2.1 and $1.7                                  156.0         132.6
    Other current assets                                73.6          50.0
    Current assets of discontinued operations            0.1           0.6
                                                ------------  ------------
Total current assets                                   358.7         314.4

Property, plant and equipment, net of
 accumulated depreciation and amortization of
 $463.9 and $429.0                                     173.7         186.1
Other marketable securities                             11.5          19.3
Goodwill                                               222.6         223.7
Other intangibles, net                                 109.3         117.9
Other assets                                            58.5          92.8
                                                ------------  ------------
Total assets                                    $      934.3  $      954.2
                                                ============  ============

Liabilities and stockholders' equity
Current liabilities:
    Trade accounts payable                      $       61.9  $     $ 65.8
    Current portion of long-term debt                   21.6          15.1
    Other current liabilities                           83.7         103.4
    Current liabilities of discontinued
     operations                                          0.1           2.0
                                                ------------  ------------
Total current liabilities                              167.3         186.3

Long-term debt                                       1,584.0       1,590.9
Other liabilities                                       45.5          39.0
                                                ------------  ------------
Total liabilities                                    1,796.8       1,816.2
                                                ------------  ------------

Stockholders' equity:
    Preferred stock, $0.01 par value; 20.0
     shares authorized; no shares issued or
     outstanding                                           -             -
    Common stock, $0.01 par value; 180.0 shares
     authorized, 29.8 and 29.8 shares issued at
     June 30, 2011, and December 31, 2010,
     respectively; 29.8 and 29.8 shares
     outstanding as of June 30, 2011, and
     December 31, 2010, respectively                     0.3           0.3
     Additional paid-in capital                        891.6         893.5
    Treasury stock at cost; 0 shares at June 30,
     2011, and December 31, 2010                           -             -
    Retained earnings                               (1,781.3)     (1,780.6)
    Accumulated other comprehensive income               8.9           9.3
                                                ------------  ------------
Total TransUnion Corp. stockholders' equity           (880.5)       (877.5)
Noncontrolling interests                                18.0          15.5
                                                ------------  ------------
Total stockholders' equity                            (862.5)       (862.0)
                                                ------------  ------------
Total liabilities and stockholders' equity      $      934.3  $      954.2
                                                ============  ============





                    TRANSUNION CORP. AND SUBSIDIARIES
                    Consolidated Statements of Income
                   (in millions, except per share data)
                                (Unaudited)

                                    Three Months Ended   Six Months Ended
                                         June 30,            June 30,
                                    ------------------  ------------------
                                      2011      2010      2011      2010
                                    --------  --------  --------  --------
Revenue                             $  257.5  $  237.4  $  503.4  $  464.3

Operating expenses
    Cost of services (exclusive of
     depreciation and amortization
     below)                            110.5     100.1     212.1     199.2
    Selling, general and
     administrative                     65.0      76.6     132.5     138.1
    Depreciation and amortization       21.5      20.1      43.2      40.3
                                    --------  --------  --------  --------
Total operating expenses               197.0     196.8     387.8     377.6

Operating income                        60.5      40.6     115.6      86.7

Non-operating income and expense
    Interest expense                   (30.7)    (10.8)    (64.3)    (16.1)
    Interest income                      0.1       0.3       0.3       0.7
    Other income and (expense), net      2.6     (46.6)    (56.2)    (45.8)
                                    --------  --------  --------  --------
Total non-operating income and
 expense                               (28.0)    (57.1)   (120.2)    (61.2)

Income (loss) from continuing
 operations before income taxes         32.5     (16.5)     (4.6)     25.5

(Provision) benefit for income
 taxes                                  (7.3)     (8.5)      6.6     (23.6)
                                    --------  --------  --------  --------

Income (loss) from continuing
 operations                             25.2     (25.0)      2.0       1.9

Discontinued operations, net of tax     (0.3)     12.8      (0.5)      8.7
                                    --------  --------  --------  --------
Net income (loss)                       24.9     (12.2)      1.5      10.6
Less: net income attributable to
 noncontrolling interests               (2.0)     (2.0)     (4.1)     (3.9)
                                    --------  --------  --------  --------
Net income (loss) attributable to
 TransUnion Corp.                   $   22.9  $  (14.2) $   (2.6) $    6.7
                                    ========  ========  ========  ========

Basic earnings (loss) per common
 share:
    Income (loss) from continuing
     operations attributable to
     TransUnion Corp. common
     stockholders                   $   0.78  $  (0.39) $  (0.07) $  (0.03)
    Discontinued operations, net of
     tax                               (0.01)     0.19     (0.02)     0.12
    Net income (loss) attributable
     to TransUnion Corp. common
     stockholders                       0.77     (0.21)    (0.09)     0.09

Diluted earnings (loss) per common
 share:
    Income (loss) from continuing
     operations attributable to
     TransUnion Corp. common
     stockholders                   $   0.77  $  (0.39) $  (0.07) $  (0.03)
    Discontinued operations, net of
     tax                               (0.01)     0.19     (0.02)     0.12
    Net income (loss) attributable
     to TransUnion Corp. common
     stockholders                       0.76     (0.21)    (0.09)     0.09

Weighted average number of common
 shares:
    Basic                               29.8      68.9      29.8      72.8
    Diluted                             30.1      68.9      29.8      72.8




                    TRANSUNION CORP. AND SUBSIDIARIES
                  Consolidated Statements of Cash Flows
                              (in millions)
                               (Unaudited)

                                                          Six Months Ended
                                                              June 30,
                                                          ----------------
                                                            2011     2010
                                                          -------  -------
Cash flows from operating activities:
    Net income                                            $   1.5  $  10.6
    Less: income (loss) from discontinued operations, net
     of tax                                                  (0.5)     8.7
                                                          -------  -------
    Income from continuing operations                         2.0      1.9
    Adjustments to reconcile net income from continuing
     operations to net cash provided by operating
     activities:
       Loss on early extinguishment of debt                  59.3     11.0
       Depreciation and amortization                         43.2     40.3
       Change in control transaction fees                       -     27.8
       Deferred financing fees                                2.5     12.1
       Stock-based incentive compensation                     2.4     26.4
       Provision for losses on trade accounts receivable      1.5      0.6
       Deferred taxes                                       (13.5)     3.9
       Other                                                  1.2     (0.1)
       Changes in assets and liabilities:
          Trade accounts receivable                         (19.9)   (18.4)
          Other current and long-term assets                (11.9)    (7.9)
          Trade accounts payable                             10.8      0.3
          Other current and long-term liabilities           (20.0)   (13.3)
                                                          -------  -------
Cash provided by operating activities of continuing
 operations                                                  57.6     84.6
Cash used in operating activities of discontinued
 operations                                                  (1.3)    (4.2)
                                                          -------  -------
Cash provided by operating activities                        56.3     80.4

Cash flows from investing activities:
    Capital expenditures for property and equipment         (38.9)   (19.0)
    Investments in trading securities                        (0.9)       -
    Proceeds from sale of trading securities                  9.0      0.3
    Proceeds from sale and redemption of investments in
     available-for-sale securities                              -    114.4
    Investments in held-to-maturity securities               (6.3)       -
    Proceeds from held-to-maturity securities                   -      4.9
    Proceeds from sale of assets of discontinued
     operations                                                 -     10.6
    Acquisitions and purchases of noncontrolling
     interests, net of cash acquired                         (4.2)    (8.7)
    Other                                                       -      0.8
                                                          -------  -------
Cash (used in) provided by investing activities             (41.3)   103.3




                    TRANSUNION CORP. AND SUBSIDIARIES                      
             Consolidated Statements of Cash Flows--Continued
                              (in millions)
                               (Unaudited)

                                                         Six Months Ended
                                                             June 30,
                                                        ------------------
                                                          2011      2010
                                                        --------  --------
Cash flows from financing activities:
    Proceeds from senior secured credit facility           950.0     950.0
    Extinguishment of senior secured credit facility      (945.2)        -
    Prepayment fee on early extinguishment of senior
     secured credit facility                                (9.5)        -
    Proceeds from issuance of senior notes                     -     645.0
    Proceeds from RFC loan                                     -      16.7
    Proceeds from revolving line of credit                     -      15.0
    Repayments of debt                                      (7.0)   (589.7)
    Treasury stock purchases                                   -      (5.4)
    Distribution of merger consideration                    (0.2) (1,171.7)
    Debt financing fees                                    (11.3)    (85.3)
    Change in control transaction fees                         -     (27.8)
    Other                                                    0.2      (3.6)
                                                        --------  --------
Cash used in financing activities                          (23.0)   (256.8)
Effect of exchange rate changes on cash and cash
 equivalents                                                (0.4)     (0.3)
                                                        --------  --------
Net change in cash and cash equivalents                     (8.4)    (73.4)
Cash and cash equivalents, beginning of period,
 including cash of discontinued operations of $0 in
 2011 and $11.6 in 2010                                    131.2     149.1
                                                        --------  --------
Cash and cash equivalents, end of period                $  122.8  $   75.7
                                                        ========  ========




                    TRANSUNION CORP. AND SUBSIDIARIES
                            Segment Information
                                (Unaudited)


              Three Months Ended June 30,     Six Months Ended June 30,
            -----------------------------   -----------------------------
(dollars in                   $       %                       $       %
 millions)   2011    2010   Change  Change   2011    2010   Change  Change
            ------  ------  ------  -----   ------  ------  ------- -----
Revenue:
U.S.
 Information
 Services:
  Online
   Data
   Services $113.2  $111.6  $  1.6    1.4%  $222.1  $217.7  $   4.4    2.0%
  Credit
   Marketing
   Services   32.3    27.5     4.8   17.5%    63.6    54.5      9.1   16.7%
  Decision
   Services   20.2    20.7    (0.5)  (2.4)%   39.5    39.2      0.3    0.8%
            ------  ------  ------          ------  ------  -------
Total U.S.
 Information
 Services    165.7   159.8     5.9    3.7%   325.2   311.4     13.8    4.4%

International
  Developed
   markets    22.8    21.9     0.9    4.1%    43.5    42.3      1.2    2.8%
  Emerging
   markets    31.7    25.4     6.3   24.8%    61.4    49.9     11.5   23.0%
            ------  ------  ------          ------  ------  -------
Total
 Inter-
 national     54.5    47.3     7.2   15.2%   104.9    92.2     12.7   13.8%


Interactive   37.3    30.3     7.0   23.1%    73.3    60.7     12.6   20.8%

            ------  ------  ------          ------  ------  -------
Total
 revenue    $257.5  $237.4  $ 20.1    8.5%  $503.4  $464.3  $  39.1    8.4%
            ======  ======  ======          ======  ======  =======

Operating
 Income(1)

U.S.
 Information
 Services
 (2)        $ 42.3  $ 37.4  $  4.9   13.1%  $ 86.4  $ 76.6  $   9.8   12.8%
Inter-
 national
 (2)        $ 16.4  $ 14.7  $  1.7   11.6%  $ 30.9  $ 28.8  $   2.1    7.3%
Interactive $ 14.7  $  8.5  $  6.2   72.9%  $ 23.7  $ 14.0  $   9.7   69.3%
Corporate
 (2)        $(12.9) $(20.0) $  7.1  (35.5)% $(25.4) $(32.7) $   7.3   22.3%
            ------  ------  ------          ------  ------  -------
Total
 operating
 income(2)  $ 60.5  $ 40.6  $ 19.9   49.0%  $115.6  $ 86.7  $  28.9   33.3%

Operating
 Margin(3)

U.S.
 Information
 Services     25.5%   23.4%           2.1%    26.6%   24.6%            2.0%
International 30.1%   31.1%          (1.0)%   29.5%   31.2%
(1.8)%
Interactive   39.4%   28.1%          11.4%    32.3%   23.1%            9.3%
Total
 operating
 margin       23.5%   17.1%           6.4%    23.0%   18.7%            4.3%

(1) For the three and six months ended June 30, 2011, operating income
    included a $3.6 million outsourcing vendor contract early termination
    fee and a $2.7 million software impairment and related restructuring
    charge due to a regulatory change requiring a software platform
    replacement. Both of these expenses were recorded in our USIS segment.
    For the three and six months ended June 30, 2010, operating income
    included $21.4 million of accelerated stock-based compensation and
    related expenses resulting from the change in control transaction that
    were recorded in each segment and Corporate as follows: USIS $12.2
    million; International $2.6 million; Interactive $1.2 million; and
    Corporate $5.4 million.

(2) For the three and six months ended June 30, 2010, a $2.2 million legal
    settlement with a global vendor impacted segment and corporate
    operating income as follows: USIS a $1.9 million increase;
    International a $2.2 million increase; and Corporate a $1.9 million
    decrease.

(3) When comparing changes for margins, variance changes are based on a
    "basis point" change.



                   TRANSUNION CORP. AND SUBSIDIARIES
 Key  Financial Performance Measures and Reconciliation of Non-GAAP
                             Measures
                            (Unaudited)

              Three Months Ended June 30,     Six Months Ended June 30,
            ------------------------------  -----------------------------
(dollars in                   $       %                       $       %
 millions)   2011    2010   Change  Change   2011    2010   Change  Change

Revenue     $ 257.5 $237.4  $ 20.1    8.5%  $503.4  $464.3  $ 39.1     8.4%

Reconciliation
 of net
 income
 (loss)
 attributable
 to
 TransUnion
 Corp. to
 Adjusted
 EBITDA:
Net income
 (loss)
 attributa-
 ble to
 TransUnion
 Corp.      $  22.9 $(14.2) $ 37.1          $ (2.6) $  6.7  $ (9.3)
Discontinued
 operations     0.3  (12.8)   13.1             0.5    (8.7)    9.2
            ------- ------  ------          ------  ------  ------
Net income
 (loss)
 from
 continuing
 operations
 attributable
 to
 TransUnion
 Corp.      $  23.2 $(27.0) $ 50.2          $ (2.1) $ (2.0) $ (0.1)
Net
 interest
 expense       30.6   10.5    20.1            64.0    15.5    48.5
Income tax
 (benefit)
 provision      7.3    8.5    (1.2)           (6.6)   23.6   (30.2)
Depreciation
 and
 amortization  21.5   20.1     1.4            43.2    40.3     2.9
Stock-based
 compensation   1.2    3.4    (2.2)            2.4     8.5    (6.1)
Other
 (income)
 and
 expense(1)     1.1   49.7   (48.6)           63.3    50.4    12.9
Adjustments
 (2)            6.3   21.4   (15.1)            6.3    21.4   (15.1)
            ------- ------  ------          ------  ------  ------
Adjusted
 EBITDA(3)  $  91.2 $ 86.6  $  4.6    5.3%  $170.5  $157.7  $ 12.8     8.1%

Other
 metrics:
Cash
 provided by
 operating
 activities
 of
 continuing
 operations $  31.7 $ 59.5  $(27.8) (46.7)% $ 57.6  $ 84.6  $(27.0) (31.9)%
Capital
 expenditu-
 res(4)     $  12.2 $ 13.6  $ (1.4) (10.3)% $ 38.9  $ 19.0  $ 19.9   104.7%

(1) Other income and expense above includes all amounts included on our
    consolidated statement of income in other income and expense, net,
    except for earnings from equity method investments and dividends
    received from cost method investments. For the six months ended June
    30, 2011, other income and expense included a $59.3 million loss on the
    early extinguishment of debt as a result of refinancing our senior
    secured credit facility. For the three and six months ended June 30,
    2010, other income and expense included $27.8 million of acquisition
    fees and $18.9 million of loan fees related to the change in control
    transaction.

(2) For the three and six months ended June 30, 2011, adjustments included
    a $3.6 million outsourcing vendor contract early termination fee and a
    $2.7 million software impairment and related restructuring charge due
    to a regulatory change requiring a software platform replacement. Both
    of these expenses were recorded in our USIS segment. For the three and
    six months ended June 30, 2010, adjustments included $21.4 million of
    accelerated stock-based compensation and related expenses resulting
    from the change in control transaction that were recorded in each
    segment and Corporate. See page 9, footnote 1, for the impact on
    segment operating income for these adjustments.

(3) Adjusted EBITDA is a non-GAAP measure. 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
    ongoing operating performance. In addition, Adjusted EBITDA does not
    reflect our capital expenditures, interest, income tax, depreciation,
    amortization, stock-based compensation or 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. In addition to its use as a measure
    of our operating performance, our board of directors and executive
    management team focus on Adjusted EBITDA as a compensation measure. The
    annual variable compensation for certain members of our management is
    based in part on Adjusted EBITDA. Adjusted EBITDA is not a measure of
    financial condition or profitability under GAAP and should not be
    considered an alternative to cash flow from operating activities, as a
    measure of liquidity or as an alternative to operating income or net
    income as an indicator of operating performance. We believe that the
    most directly comparable GAAP measure to Adjusted EBITDA is net income
    (loss) attributable to TransUnion Corp. The reconciliation of Adjusted
    EBITDA to net income (loss) attributable to TransUnion Corp. is
    included in the table above.

(4) Capital expenditures for the six months ended June 30, 2011, include
    $18.8 million paid in the first quarter of 2011 for assets purchased 
    and accrued for in the fourth quarter of 2010.

 

Contact
David McCrary
TransUnion
E-mail: Email Contact
Telephone: 312 985 2860

Media Contacts

Consumer, Corporate and International

Clifton O'Neal
coneal@transunion.com

Credit Statistics, B2B and International

Dave Blumberg
 

 
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