Equifax Inc. (EFX) has reported 9.92 percent rise in profit for the quarter ended Dec. 31, 2016. The company has earned $123 million, or $1.01 a share in the quarter, compared with $111.90 million, or $0.93 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $172.40 million, or $1.42 a share compared with $137.50 million or $1.14 a share, a year ago.
Revenue during the quarter grew 20.23 percent to $801.10 million from $666.30 million in the previous year period. Gross margin for the quarter contracted 197 basis points over the previous year period to 64.26 percent. Total expenses were 74.55 percent of quarterly revenues, up from 73.45 percent for the same period last year. That has resulted in a contraction of 110 basis points in operating margin to 25.45 percent.
Operating income for the quarter was $203.90 million, compared with $176.90 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $292.10 million compared with $229.90 million in the prior year period. At the same time, adjusted EBITDA margin improved 196 basis points in the quarter to 36.46 percent from 34.50 percent in the last year period.
"The business had an outstanding performance in the fourth quarter, delivering results that exceeded both our revenue and EPS guidance. Equifax ends the year with record results and enters 2017 with outstanding momentum across all business units and centers of excellence," said Richard F. Smith, Equifax's chairman and chief executive officer.
For the first-quarter, Equifax forecasts revenue to be in the range of $822 million to $826 million. On an adjusted basis, the company expects diluted earnings per share to be in the range of $1.39 to $1.42.
For fiscal year 2017, Equifax forecasts revenue to be in the range of $3,375 million to $3,425 million. The company expects diluted earnings per share to be in the range of $5.96 to $6.10 on adjusted basis.
Operating cash flow improves
Equifax Inc. has generated cash of $784.50 million from operating activities during the year, up 5.71 percent or $42.40 million, when compared with the last year.
The company has spent $1,969.40 million cash to meet investing activities during the year as against cash outgo of $147.80 million in the last year.
Cash flow from financing activities was $1,187.50 million for the year as against cash outgo of $612 million in the last year period.
Cash and cash equivalents stood at $129.30 million as on Dec. 31, 2016, up 38.59 percent or $36 million from $93.30 million on Dec. 31, 2015.
Working capital remains negative
Working capital of Equifax Inc. was negative $586.70 million on Dec. 31, 2016 compared with negative $42.20 million on Dec. 31, 2015. Current ratio was at 0.53 as on Dec. 31, 2016, down from 0.93 on Dec. 31, 2015.
Days sales outstanding were almost stable at 25 days for the quarter, when compared with the last year period.
At the same time, days payable outstanding went up to 13 days for the quarter from 8 for the same period last year.
Debt increases substantially
Equifax Inc. has witnessed an increase in total debt over the last one year. It stood at $2,672.20 million as on Dec. 31, 2016, up 124.99 percent or $1,484.50 million from $1,187.70 million on Dec. 31, 2015. Total debt was 40.10 percent of total assets as on Dec. 31, 2016, compared with 26.34 percent on Dec. 31, 2015. Debt to equity ratio was at 0.98 as on Dec. 31, 2016, up from 0.51 as on Dec. 31, 2015. Interest coverage ratio deteriorated to 8.43 for the quarter from 11.27 for the same period last year.
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