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TransUnion Reports First Quarter 2016 Results

--  Revenue of $406 million, an increase of 15 percent (18 percent on a
    constant currency basis) compared with the first quarter of 2015
--  Adjusted EBITDA of $141 million, an increase of 23 percent (26 percent
    on a constant currency basis) compared with the first quarter of 2015
--  Adjusted Diluted Earnings per Share of $0.32 compared with $0.20 in the
    first quarter of 2015



TransUnion TRU, +1.06% (the "Company") today announced financial results for the quarter ended March 31, 2016.

Total revenue was $406 million, an increase of 15 percent (18 percent on a constant currency basis) compared with the first quarter of 2015. Acquisitions accounted for a 1 percent increase in revenue. Net income attributable to TransUnion was $13 million compared with a net loss attributable to TransUnion of $7 million in the first quarter of 2015. Diluted earnings per share were $0.07 compared with $(0.04) in the first quarter of 2015.

Adjusted EBITDA was $141 million, an increase of 23 percent (26 percent on a constant currency basis) compared with the first quarter of 2015. Adjusted Net Income was $58 million, an increase of 96 percent compared with the first quarter of 2015. Adjusted Diluted Earnings per Share were $0.32 compared with $0.20 in the first quarter of 2015.

"TransUnion is off to a strong start in 2016, delivering another quarter of double-digit revenue and Adjusted EBITDA growth with over 200 basis points of margin expansion," said Jim Peck, TransUnion's president and chief executive officer. "All three segments exceeded expectations by executing on our strategy, which is generating broad based and balanced growth from our core business, new product growth initiatives, and from our higher growth verticals and markets. This robust performance enabled us to raise our full year guidance for revenue, Adjusted EBITDA and Adjusted EPS. Our pipeline of innovation is focused on driving value for our customers and positions us well for long-term growth."

Segment Results (1)

U.S. Information Services (USIS)

USIS revenue was $247 million, an increase of 13 percent compared with the first quarter of 2015.

--  Online Data Services revenue was $161 million, an increase of 10 percent
    over prior year.
--  Marketing Services revenue was $37 million, an increase of 12 percent
    over prior year.
--  Decision Services revenue was $49 million, an increase of 25 percent
    over prior year.



Operating income was $30 million, an increase of 9 percent compared with the first quarter of 2015. Adjusted Operating Income was $77 million, an increase of 13 percent compared with the first quarter of 2015.

International

International revenue was $68 million, an increase of 7 percent (increase of 22 percent on a constant currency basis) compared with the first quarter of 2015. Acquisitions accounted for a 5 percent increase in revenue.

--  Developed markets revenue was $23 million, an increase of 11 percent (19
    percent on a constant currency basis) over prior year.
--  Emerging markets revenue was $45 million, an increase of 5 percent
    (increase of 23 percent on a constant currency basis) over prior year.
    Acquisitions accounted for an 8 percent increase in revenue.



Operating income was $5 million, an increase of 85 percent compared with the first quarter of 2015. Adjusted Operating Income was $17 million, an increase of 18 percent (increase of 37 percent on a constant currency basis) compared with the first quarter of 2015.

Consumer Interactive

Consumer Interactive revenue was $106 million, an increase of 25 percent compared with the first quarter of 2015.

Operating income was $40 million, an increase of 51 percent compared with the first quarter of 2015. Adjusted Operating Income was $42 million, an increase of 46 percent compared with the first quarter of 2015.

Liquidity and Capital Resources

Cash and cash equivalents were $150 million at March 31, 2016 and $133 million at December 31, 2015. Total debt, including the current portion of long-term debt, increased to $2.4 billion at March 31, 2016 compared with $2.2 billion at December 31, 2015, primarily due to funding the acquisition of CIFIN.

For the three months ended March 31, 2016, cash provided by operating activities was $42 million compared with $17 million for the same period in 2015, due primarily to the increase in revenue along with a decrease in cash paid for interest. Cash used in investing activities was $161 million compared with $35 million for the same period in 2015, due primarily to the acquisition of CIFIN. Capital expenditures were $31 million compared with $30 million for the same period in 2015. Cash provided by financing activities was $136 million compared to $29 million for the same period in 2015, due primarily to the incremental borrowing on term loan B under our existing credit facility to fund the CIFIN acquisition.

2016 Full Year Outlook

For the full year of 2016, we are raising our revenue, Adjusted EBITDA, Adjusted EBITDA margin and Adjusted Diluted Earnings per Share guidance as follows. Consolidated revenue is expected to be between $1.63 billion and $1.65 billion, an increase of 10 to 12 percent on a constant currency basis. Adjusted EBITDA is expected to be between $600 million and $610 million, an increase of 16 to 18 percent on a constant currency basis. Adjusted EBITDA margin is expected to be approximately 37 percent, an increase of approximately 200 basis points. Adjusted Diluted Earnings per Share is expected to be between $1.30 and $1.34, an increase of 19 to 23 percent.

Consistent with our previous full year guidance, we expect approximately 2 percent revenue growth from acquisitions as well as approximately 2 percent declines in revenue and Adjusted EBITDA due to foreign exchange rates.

2016 Second Quarter Outlook

For the second quarter of 2016, consolidated revenue is expected to be between $405 million and $410 million, an increase of 10 to 11 percent on a constant currency basis compared with the second quarter of 2015. Adjusted EBITDA is expected to be between $145 million and $150 million, an increase of 11 to 15 percent on a constant currency basis. Adjusted Diluted Earnings per Share is expected to be between $0.31 and $0.33, an increase of 15 to 22 percent.

This guidance includes approximately 2 percent revenue growth from acquisitions as well as approximately 3 percent declines in revenue and Adjusted EBITDA due to foreign exchange rates.

Footnotes

1.  In the first quarter of 2016, we moved our direct to consumer reseller
    business and reallocated certain other costs related to our consumer
    facing business in the U.S. from our USIS segment to our Consumer
    Interactive segment. These changes better reflect the evolution of our
    consumer facing business in the U.S. and how we manage that business. As
    a result, we modified our segment reporting effective the first quarter
    of 2016. The segment results below have been recast to reflect these
    changes for all periods presented. These changes do not impact our
    consolidated results. Refer to our investor relations website,
    www.transunion.com/tru, where we have posted a schedule that shows this
    new basis of accounting for each quarter back to the first quarter of
    2014 for additional information.



Earnings Webcast Details

In conjunction with this release, TransUnion will host a conference call and webcast today at 4:00 p.m. Central time to discuss the business results for the quarter and certain forward-looking information. This session may be accessed at www.transunion.com/tru. A replay of the call will also be available at this website following the conclusion of the call.

About TransUnion

TransUnion is a leading global risk and information solutions provider to businesses and consumers. The Company provides consumer reports, risk scores, analytical services and decisioning capabilities to businesses. Businesses embed its solutions into their process workflows to acquire new customers, assess consumer ability to pay for services, identify cross-selling opportunities, measure and manage debt portfolio risk, collect debt, verify consumer identities and investigate potential fraud. Consumers use its solutions to view their credit profiles and access analytical tools that help them understand and manage their personal information and take precautions against identity theft. www.transunion.com

Availability of Information on TransUnion's Website

Investors and others should note that TransUnion routinely announces material information to investors and the marketplace using SEC filings, press releases, public conference calls, webcasts and the TransUnion Investor Relations website. While not all of the information that the Company posts to the TransUnion Investor Relations website is of a material nature, some information could be deemed to be material. Accordingly, the Company encourages investors, the media, and others interested in TransUnion to review the information that it shares on www.transunion.com/tru.

Non-GAAP Financial Measures

This earnings release presents certain growth rates on schedule 1 assuming foreign currency exchange rates are consistent between years. This allows financial results to be evaluated without the impact of fluctuations in foreign currency exchange rates. This earnings release also presents Adjusted EBITDA, Adjusted EBITDA Margin, segment Adjusted Operating Income, segment Adjusted Operating Margin, Adjusted Effective Tax Rate, Adjusted Net Income (Loss) and Adjusted Diluted Earnings per Share. These are important financial measures for the Company but are not financial measures as defined by GAAP. We present these financial measures as supplemental measures of our operating performance because we believe they provide meaningful information regarding our performance and provide a basis to compare operating results between periods. In addition, our board of directors and executive management team use Adjusted EBITDA as a compensation measure. These financial measures should be reviewed in conjunction with the relevant GAAP financial measures and are not presented as alternative measures of GAAP. Other companies in our industry may define or calculate these measures differently than we do, limiting their usefulness as comparative measures. Because of these limitations, these non-GAAP financial measures should not be considered in isolation or as substitutes for performance measures calculated in accordance with GAAP, including operating income, operating margin, effective tax rate, net income (loss) attributable to the Company, earnings per share or cash provided by operating activities. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the attached Schedules.

Adjusted EBITDA is defined as net income (loss) attributable to TransUnion plus net interest expense, plus (less) provision (benefit) for income taxes, plus depreciation and amortization, plus stock-based compensation, plus mergers and acquisitions, divestitures and business optimization expenses, plus technology transformation expenses, plus (less) certain other expenses (income). Adjusted Operating Income is defined as operating income plus stock-based compensation, plus mergers and acquisitions, divestitures and business optimization expenses, plus technology transformation expenses, plus (less) certain other expenses (income), plus amortization of certain intangible assets. Adjusted Effective Tax Rate is defined as adjusted provision for income taxes divided by adjusted income before income taxes. Adjusted Net Income is defined as net income (loss) attributable to TransUnion plus stock-based compensation, plus mergers and acquisitions, divestitures and business optimization expenses, plus technology transformation expenses, plus (less) certain other expenses (income), plus amortization of certain intangible assets, plus or minus changes in provision for income taxes. Adjusted Earnings per Share is defined as Adjusted Net Income divided by weighted-average shares outstanding.

Forward-Looking Statements

This earnings release 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. Any statements made in this earnings release that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements. These statements often include words such as "anticipate," "expect," "suggest," "plan," "believe," "intend," "estimate," "target," "project," "should," "could," "would," "may," "will," "forecast," "outlook," "potential," "continues," "seeks," "predicts," or the negative of these words and other similar expressions. Factors that could cause actual results to differ materially from those described in the forward-looking statements include macroeconomic and industry trends and adverse developments in the debt, consumer credit and financial services markets; our ability to provide competitive services and prices; our ability to retain or renew existing agreements with large or long-term customers; 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; regulatory oversight of "critical activities," our ability to effectively manage our costs; economic and political stability in international markets where we operate; our ability to effectively develop and maintain strategic alliances and joint ventures; our ability to timely develop new services and the market's willingness to adopt our new services; our ability to manage and expand our operations and keep up with rapidly changing technologies; our ability to timely complete our multi-year technology transformation; our ability to make acquisitions and integrate the operations of acquired businesses; our ability to protect and enforce our intellectual property, trade secrets and other forms of unpatented intellectual property; our ability to defend our intellectual property from infringement claims by third parties; the ability of our outside service providers and key vendors to fulfill their obligations to us; further consolidation in our end-customer markets; the increased availability of free or inexpensive consumer information; losses against which we do not insure; 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 reliance on key management personnel; our controlling stockholders; and other one-time events and other factors that can be found in our Annual Report on Form 10-K for the year ended December 31, 2015, as modified in any...


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