Equifax sees FY23 adjusted EPS $6.98, consensus $7.17

Mark W. Begor, CEO of Equifax said, “In June, we received shareholder approval for the merger of Boa Vista Servicos, the second largest credit bureau in Brazil, and we expect to close the strategic acquisition in early August. This merger will expand Equifax capabilities in the large and fast-growing Brazilian market and add to our diverse International portfolio, while giving Boa Vista Servicos access to our expansive global capabilities and cloud-native data, products, decisioning and analytical technology for the rapid development of new products and services, and expansion into new industries. We expect the weaker than expected U.S. mortgage market that we saw in June to continue, and we now expect full year mortgage originations to decline about 37%, which is down five percentage points from our prior framework. We also expect to see the slowing in U.S. hiring to continue throughout 2023, but expect to offset this impact on non-mortgage revenue with stronger growth in the Workforce Government business, as well as solid performance in USIS and International. As we look to our FY23 guidance, we are reducing our Revenue guidance to $5.300B at the midpoint reflecting the more negative impact of the weaker mortgage market and loss of high margin mortgage revenue. We are taking actions to realize additional Cloud spending reductions of $10M in the second half. Our full year Adjusted EPS Guidance is now $6.98 at the midpoint, reflecting the impact of the lower mortgage revenue. We are confident in the future of the New Equifax as we move toward completion of our EFX Cloud and Data transformation, leverage our new Cloud capabilities to accelerate new product roll-outs that ‘Only Equifax’ can provide to drive future growth in 2023 and beyond. We are energized about the New Equifax and remain confident in our long-term 8-12% revenue growth framework that will deliver higher margins and free cash flow.”