Barclays European Business Services Forum/media/Files/T/... · 9/5/2018 · Barclays European...

Barclays European Business Services Forum

SEPTEMBER 5, 2018

Todd Cello

EVP, Chief Financial Officer

David Neenan

President, International

© 2018 TransUnion LLC All Rights Reserved | 2

Disclaimer

This presentation contains forward-looking statements within the meaning of the Private Securities

Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of

TransUnion’s management and are subject to significant risks and uncertainties. Actual results may

differ materially from those described in the forward-looking statements. Factors that could cause

TransUnion’s actual results to differ materially from those described in the forward-looking statements

can be found in TransUnion’s Annual Report on Form 10-K for the year ended December 31, 2017, as

modified in any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K, which are

filed with the Securities and Exchange Commission and are available on TransUnion's website

(www.transunion.com/tru) and on the Securities and Exchange Commission's website (www.sec.gov).

TransUnion undertakes no obligation to update the forward-looking statements to reflect the impact of

events or circumstances that may arise after the date of the forward-looking statements.

v

v

TransUnion Overview


TransUnion by the Numbers

• 1 billion consumer records

• 600+ active solutions

• 23 credit bureaus

• 50,000 business solutions

• 4.8 billion updates per

month from data providers

• 50+ petabytes of data

• Billions of transactions

processed on a daily basis

• 450 million credit histories

worldwide

Differentiated Data Assets


Strong Financial Performance

$1,507

$1,705

$1,934

$2,338

2015 2016 2017 2018E

$527

$637

$748

$907

2015 2016 2017 2018E

$ in millions $ in millions

+16% CAGR2

Adj.

EBITDA

Margin %

35.0%

(+10bps)

37.3%

(+240bps)

38.7%

(+130bps)

38.8%

(+10bps)

Adjusted Revenue Adjusted EBITDA

1 1

1Reflects midpoint of 2018 guidance.2CAGR calculated for 2015 actuals – midpoint of 2018 guidance,

provided on July 24, 2018.

+20% CAGR2


Consistently Strong Performance Since IPO

$353 $379 $389 $386

$406 $426 $438 $436

$455 $475

$498 $506 $537

$563

$250

$300

$350

$400

$450

$500

$550

$600

Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18

20%

Quarterly Adjusted EBITDA

Quarterly Revenue

$115 $135 $140 $137 $141

$159 $167 $169 $172 $186 $194 $196 $203

$221

$75

$100

$125

$150

$175

$200

$225

Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18

$ in millions

$ in millions

YoY

growth

16% 11% 18%

16% 16% 15% 15% 13%12%15%

23% 18%

12%

19% 24%YoY

growth

12% 14% 16%

21% 17% 17% 16% 19%18%

12% 19%18%


USIS Overview

USIS Historical Financials(60% of total FY 2017 Gross Revenue)• Portfolio of solutions for stable and

high-growth markets

• Deep subject matter expertise organized

by vertical leadership

– Financial Services, where we serve 8 of the

top 10 U.S. banks, the top ten credit card

issuers and the top 25 auto lenders

– Healthcare, where we serve 1,800 hospitals

and 250,000 physicians

– Insurance, where we serve 14 of the top 15

auto insurance carriers

– Other verticals include Rental Screening,

Collections and Government

• Comprehensive database of both FCRA

and non-FCRA data

$812

$924

$1,045

$1,204

$272$296

$348

$423

33%32%

33%

35%

0%

5%

10%

15%

20%

25%

30%

35%

2014 2015 2016 2017

Revenue Adj. Op. Inc. Adj. Op. Inc. Margin

+14%

Revenue

CAGR

+16% Adj.

Operating

Income

CAGR

$ in millions


International Overview

International Historical Financials1

(18% of total FY 2017 Gross Revenue)

1International financials based on constant currency at FY17 actual rates.

$221

$265

$324

$362

$60$68

$100$114

27%

26%

31% 31%

10%

15%

20%

25%

30%

2014 2015 2016 2017


+18%

Revenue

CAGR

+24% Adj.

Operating

Income

CAGR

$ in millions

• Structurally advantaged portfolio

– Balanced across developed, emerging

– Exposed to high growth banking markets and

fast growing alternative lending regions

– Solid mix of regional IP that can be leveraged

globally, especially post-Callcredit acquisition

• Increased emphasis on client

engagement paying dividends

• Continued strong track record of scaling

new solutions across regions

• Build up of adjacencies across regions

showing strong momentum


Consumer Interactive Overview

• Leading credit information supplier with

distribution to hundreds of millions of

consumers – directly and indirectly

• Innovative portfolio

– Credit management

– Identity protection

– Financial education

• Indirect channel continues to benefit

from strong partner business

• Direct channel has benefited recently

from heightened consumer interest in

credit monitoring

CI Historical Financials(22% of total FY 2017 Gross Revenue)

$294

$370

$407

$432

$103

$144

$176

$205

35%

39%

43%

48%

10%

15%

20%

25%

30%

35%

40%

45%

50%

2014 2015 2016 2017


+14%

Revenue

CAGR

+26% Adj.

Operating

Income

CAGR

$ in millions


Our Strategy

GROW, DEFEND

and INNOVATE

from the core

• Deliver compelling, innovative and differentiated solutions to our customers

across global businesses

EXPAND in

attractive

markets

• Invest in high-growth, adjacent markets, geographies and channels to drive growth

and further diversify our portfolio

ENABLE the

empowered

consumer

• Extend consumer reach through strategic partnerships in the Indirect channel and

with expanded free offerings in the Direct channel

LEVERAGE our

enterprise

operating model

• Leverage our data assets and capabilities across all markets and verticals to enable

rapid diffusion of IP, accelerated growth and margin expansion

• Strengthen sales and marketing best practices to drive client engagement


• Combined these two products grew ~130% in the U.S. in 2017

– Up ~50% in the first half of 2018

• Currently sold in all lending end markets with considerable growth

opportunities

– Almost two-thirds of combined business is outside of mortgage

• Customers gain greater understanding of consumer credit behaviors and

consumers benefit from greater access to credit

– CreditVision allows lenders to score an additional 26 million U.S. consumers

• CreditVision grew ~50% outside of the U.S. in 2017

– Launched in Canada, Hong Kong, India, S. Africa, Colombia, and a number of

other LATAM countries

– Up ~55% in the first half of 2018

CreditVision and CreditVision Link Have Delivered

Significant Growth and Are Well Positioned For More


Demographics

Name, address, SSN, phone

Licenses

Drivers, business,

personal

Accounts

Financial

Behaviors

Browsing, behavior patterns

Inquiries

Transaction history

Scoring History

Past scores, decisions

Mobile

Carrier, passcodes, SDKs

Location

IP, proxy, network

Devices

Device ID, owners, anomalies

Compromised

Data breach and exposure

Watch Lists

Positive / negative lists

Shared Fraud

Enterprise, Consumer

The Right Data – Analyzed to Detect Patterns of

Suspicious Behaviors/Anomalies – is Critical to

Delivering a Smooth Transaction


iovation Positions TransUnion As A Clear Leader In

The Fraud And Authentication Market

• The global Fraud and Authentication market is growing strong double-

digit due to increase in digital transactions, consumer preference for

online channels and technological innovation

• iovation is one of the two leading providers of device fraud

identification globally, with data on nearly 5 billion devices

• iovation is a perfect fit with TransUnion’s suite of fraud products,

IDVision

• Together iovation and IDVision form a comprehensive 360 degree of

the consumer including their “terrestrial” data and digital/online data


Healthcare Vertical has built Leading Positions in

the Attractive Revenue Cycle Management Market

Strong combination of

solutions to support health

care providers before

services are rendered (“front

end”) and to enable efficient

discovery of payment and

coverage after services are

provided (“back end”)


2 0 0 9 2 0 11 2 0 1 3 2 0 1 6

MedData

Insurance eligibility

clearinghouse used to

check insurance

coverage on patients

Front-End

Revenue Cycle Mgmt.

Front-End

Revenue Cycle Mgmt.

Back-End

Revenue Cycle Mgmt.

Back-End

Revenue Cycle Mgmt.

2 0 1 8

Back-End

Revenue Cycle Mgmt.

FHS

Informs patients about

their out-of-pocket costs,

in real-time, prior to

treatment

eScan

Entry into insurance

discovery / back end of

revenue cycle

management

Market-leading

technology that helps

hospitals and healthcare

systems reduce

uncompensated care

costs by identifying

patient coverage after

services were provided

Auditz

Technology complements

eScan, increasing yield

Innovative Transfer DRG

(diagnosis-related groups)

solution helps providers

recover costs associated

with Medicare patient

transfer

RTech

Technology complements

eScan and Auditz

solutions, increasing yield

Revenue Protection

product offers a more

holistic view/analysis of

hospital A/R, allowing

earlier detection and

prevention of bad debt

HPS

Innovative technology

that helps healthcare

providers identify and

recover Medicare

reimbursements that they

otherwise would not

have received

Strong Healthcare Acquisition History


Insurance Vertical Continues To Deliver

Above-market Growth Through Innovation

• TU’s Insurance vertical helps our customers at every stage of the insurance

policy lifecycle

– Marketing and policy acquisition

– New business rating and underwriting

– Portfolio management

– Claims and special investigations

• Innovation continues to drive above-market growth and create further

differentiation

– Event-based triggers are driving highly-targeted and relevant marketing offers in both offline and

digital marketing channels

– In the process of introducing a solution that combines existing court record based pre-screen

capabilities (DriversRisk) with the ability to also deliver state issued Motor Vehicle Reports to

simplify underwriting work flow while reducing underwriting costs for auto insurers

– Trended credit data creates lift above traditional methods in credit-based risk models and is

gaining traction in the market

– Portfolio management capabilities provide near real-time insights to insurers about changing risks

or opportunities (cross sell) within their book of business


TransUnion is Committed to Empowering

Consumers through Partnerships

IntuitAmerican ExpressChase Capital One

v

v

International Overview


Strong, Diversified Global Positions in Both

Developed and Emerging Markets


Key Trends Across Our International Portfolio

b

Credit card penetration increasing

500 million+ people in middle

income open to buying with credit

Frictionless experience across

channels

Mobile, PC, In Branch, TV, Devices

– all integrated

Large number of non credit data

Cheaper data connectivity

Multiple governments pushing

digitization (e.g., India)

80%+ smartphone penetration

across most regions

More people on smartphone than

people with credit scores

Data-Rich

Instant

Gratification

Subject

Matter

Experts

Consent-Based

Openness

to take on

credit

Omni-Channel

Mobile first

Consumer

Real time decisions

Real time offers

GDPR in Europe

New Privacy laws imminent in

India, Brazil, Canada and HK


Leveraging Global Enterprise Model is Our Focus

2012-2014

“Sustainable Growth Engine”2015-2017

“Scaled Franchise”2018 and Beyond

“Virtuous Wheel”

Established each region on a

sustainable growth path

Constructed pipes for global IP to

flow efficiently to the markets

Enable multi-way flow of global IP

and feedback across markets

• Set the business on a double-digit

growth path

• Still fairly region-centric, some sharing

best practices with Enterprise

• Expands margins across all markets

• Enables replication of global solutions

(CreditVision launch in record time)

• Accelerates growth in adjacencies

• Rapid innovation that addresses and

influences global market trends

• Robust pipeline of growth

opportunities in all markets

• Stronger TU global brand


International Growth Model

Market Growth

Client Engagement

Product Innovation

Adjacencies

Continued share gains

across regions through

market planning, focus

on strategic growth

accounts with ‘red

carpet’ treatment and

providing holistic end to

end solutions to clients

Development and

market adoption of

global solutions like

CreditVision, Decision

Services, Fraud and ID,

Prama and CreditView

Accelerated growth in

Insurance and

Consumer Interactive

while pursuing new

opportunities in

Marketing Services,

FinTechs and

Alternative Data

enabled solutions

1

2

3

Drives TransUnion’s ability

to continue to outperform

our underlying markets


Growth Driver: Client Engagement1

Client

engagementSales/

Go-to-

market


Protect and restore confidence for

people and organizations

Build insights and analytics at the

speed your business demands

Cutting-edge, rapid modeling and

deployment

Leading device-based

authentication capabilities

Offer customers new tools that

promote credit health and

increase website engagement

Remain competitive with

differentiated consumer insights

only available through trended

credit and alternative data

Deliver targeted offers to the right

people at the right time, and

through the best channel

Engage Acquire Manage Recover

Growth Driver: Product Innovation2


Growth Driver: Adjacencies3

Accelerated Growth in

Adjacencies

Insurance

Consumer Interactive

Emerging and Growing Verticals

• 2nd largest international vertical, with further expansion from Callcredit

• Continued growth, including in Canada, Brazil, S. Africa and the U.K.

• Ability to leverage enterprise IP

• Increased emphasis on enabling banks to drive higher

engagement with their end-users

• CreditView is in 6 countries (U.S., Canada, India, Hong Kong,

S. Africa, Colombia) and is planned for the U.K. by 2019

• FinTechs

• Telco

• Retail

• Public Sector

• ID/Fraud

• Alternative Score

• Digital Marketing


Acquisition of Callcredit in the U.K.

• Proven ability to shift-share

• Validated market-demand for global products (e.g., CreditVision and CreditView)

• Ability to leverage TU’s existing solution offerings and expertise in the U.K.

• Opportunity to leverage Callcredit’s intellectual property globally, including its

unique Fraud and Affordability tools

• Substantially exceeds nearly every internal and external cost benchmark

• Multiple redundancies with TransUnion (operating and support)

• $30 million of company-identified opportunities ($15 million by end of 2019 and

another $15 million after that)

• $2.4 billion total addressable market growing 11% CAGR from 2014 – 2017

• 2nd largest and fastest growing bureau in the U.K.

• Differentiated assets

• Multiple parallels to TransUnion

Known Business,

Attractive Position,

Meaningful Market

Compelling

Revenue Synergies

Substantial

Cost Reductions


International Well Positioned for Long-term Growth

Successfully transitioning from a credit bureau to a provider of

high-value data and analytic solutions

Substantial runway in TransUnion’s International segment to continue

to generate above-market top and bottom line growth

Global operating model enables “lift and shift” of IP throughout our

International businesses and regions

Ability to attract and retain top talent in the markets where we operate

Barclays European Business Services Forum/media/Files/T/... · 9/5/2018 · Barclays European...

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