Atlanta-based Equifax, one of the nation’s three major credit-reporting companies, reported double-digit growth in second-quarter earnings and revenue Wednesday, with results beating Wall Street expectations.
The company, which competes with TransUnion Corp. and Experian, said it expects more growth in its bread-and-butter credit-reporting business in the second half of the year, even as a slowdown in mortgage lending puts a damper on credit checks needed for loan originations.
Net income from continuing operations was $90.5 million, or 73 cents a share on a diluted basis, a 22 percent increase from a year ago. Without the impact of acquisition-related amortization, earnings per share was 92 cents, beating analysts’ expectation by 2 cents. Its operating margin was nearly 30 percent, and revenue rose 14 percent to $586.9 million.
In December, the company acquired the credit-services unit of Computer Sciences Corp. for $1 billion. Equifax expects to have completely integrated CSC into its operations by mid-third quarter.
With rising interest rates, home lending is expected to soften in the second half of the year. Equifax said the strength of its operations that are not tied to mortgage-related credit checks will help soften the impact. Those include credit reporting for governments, ID management, fraud prevention and more services to the automotive industry.
“All of the other non-mortgage activities have actually had growth accelerating over the course of the year, and that’s going to help us offset the slowdown in mortgage lending activity,” said Jeff Dodge, senior vice president for investor relations.
For the year, Equifax, which employs about 7,000, said revenue growth will be in the middle of a 10 percent to 12 percent range, partly due to the slowdown in mortgage activity.
On Wall Street, Equifax closed down 76 cents, or 1 percent, at $60.73.
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