NYSE:TRU TransUnion Q4 2023 Earnings Report $84.35 -0.26 (-0.30%) Closing price 03:59 PM EasternExtended Trading$83.44 -0.91 (-1.08%) As of 06:48 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast TransUnion EPS ResultsActual EPS$0.80Consensus EPS $0.72Beat/MissBeat by +$0.08One Year Ago EPS$0.70TransUnion Revenue ResultsActual Revenue$954.00 millionExpected Revenue$927.04 millionBeat/MissBeat by +$26.96 millionYoY Revenue Growth+5.80%TransUnion Announcement DetailsQuarterQ4 2023Date2/13/2024TimeBefore Market OpensConference Call DateTuesday, February 13, 2024Conference Call Time9:30AM ETUpcoming EarningsTransUnion's Q2 2025 earnings is scheduled for Thursday, July 24, 2025, with a conference call scheduled on Friday, July 25, 2025 at 7:00 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Annual Report (10-K)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by TransUnion Q4 2023 Earnings Call TranscriptProvided by QuartrFebruary 13, 2024 ShareLink copied to clipboard.There are 14 speakers on the call. Operator00:00:00Good day, and welcome to the TransUnion 2023 4th Quarter Earnings Conference Call. Please note, today's event is being recorded. I would now like to turn the conference over to Aaron Hoffman, Senior Vice President of Investor Relations. Please go ahead. Speaker 100:00:40Good morning, everyone, and thank you for attending today. Joining me on the call are Chris Cartwright, President and Chief Executive Officer and Todd Sello, Executive Vice President and Chief We posted our earnings release and slides to accompany this call on the TransUnion Investor Relations website this morning, they can also be found in the current report on Form 8 ks that was filed this morning. Our earnings release and the accompanying slides include various schedules, which contain more detailed information about revenue, operating expenses and other items as well as certain non GAAP disclosures and financial measures along with the corresponding of these non GAAP financial measures to their most directly comparable GAAP measures. Today's call will be recorded and a replay will be available on our website. We will also be making statements during this call that are forward looking. Speaker 100:01:29These statements are based on current expectations and assumptions and are subject to risks and uncertainties. Actual results could differ materially from those described in the forward looking statements because of factors discussed in today's earnings call, In the comments made during this conference call and in our most recent Form 10 ks, Forms 10 Q and other reports and filings with the SEC, We do not undertake any duty to update any forward looking statement. Also in early January, we filed an amendment to our 3rd In today's earnings release, we have included information on a revision primarily related to our cost of services and SG and A expenses. We plan to file our 2023 10 ks by the end of the month. So with that out of the way, let me turn the time over to Chris. Speaker 200:02:20Thanks, Aaron, and let me add my welcome and our agenda for the call this morning. First, I will provide the financial highlights for our Q4 2023 results. 2nd, I will detail our 2024 strategic priorities to drive value across TEU. And finally, Todd will detail our 4th quarter results along with our Q1 and full year 2024 guidance. In the 4th quarter, we exceeded our guidance across revenue, adjusted EBITDA and adjusted diluted EPS. Speaker 200:02:53Revenue grew 5% on an organic constant currency basis with growth across all segments. U. S. Markets grew 3% with financial services up 3% and emerging verticals at 2%. In Financial Services, lending and marketing activity remained consistent with the levels seen late in the 3rd quarter with no further deterioration in volume. Speaker 200:03:17In emerging verticals, insurance improved to mid single digit growth driven by new business wins. Services and collections and public sector both grew double digits. NuStar delivered 4% growth in the quarter in line with our expectations and accretive to our U. S. Markets growth. Speaker 200:03:35Communication remains a standout driven by Trusted Call Solutions, which grew almost 50% in the quarter. In Marketing and Risk Solutions, our subscription base remains healthy and bookings in the second half of the year were strong, which offsets still soft transaction revenues. For the year, Newstar grew revenues by 5% and expanded adjusted EBITDA margin to 31%, up a 1,000 basis points in our 2 years of ownership. Our International segment grew by 13% on a constant currency basis in the 4th quarter, the 11th consecutive quarter of double digit growth. We continue to outperform our underlying markets because of innovation, share gains and expansion into new adjacencies. Speaker 200:04:22India led with 30% revenue growth, while Canada, Asia Pacific and Africa grew double digits as well. In November, we launched the next phase of our transformation program focused on growing our global capability center network and enhancing our technology capabilities. We expect this transformation to deliver significant operating expense savings and reduce capital expenditures by 2026, while accelerating innovation and enabling growth. I will share more detail on this program shortly. We prepaid another $25,000,000 of debt during the quarter for a total of $250,000,000 in 2023. Speaker 200:05:05Also completed refinancings in October February that will reduce our annual interest expense by $8,000,000 in 2024. Looking back at the full year of 'twenty three, we delivered good results and achieved key transformation milestones despite challenging environment for many of our geographies and end markets. Our performance highlights the resiliency of our business model, the relevance of our innovations innovative solutions and the benefits of our vertical product and geographic diversification. As we turn to 2024, we believe 3 strategic priorities will create significant value for TransUnion and our shareholders. The first is to accelerate revenue and earnings growth. Speaker 200:05:49The second is to leverage NuStar's product and technology capabilities further. And the third is to execute the transformation initiatives that we announced in November. Let me spend a bit more time discussing each. Now Todd will provide full financial guidance, but at a high level, we expect to deliver 3% to 5% revenue growth, 4% to 7% adjusted EBITDA growth and 6% to 11% adjusted diluted EPS growth. We expect economic growth to moderate in 2024 and lending volumes to remain steady. Speaker 200:06:24Consumer finances in the U. S. Remain healthy due to low unemployment and real wage growth. Inflation has moderated and the Fed has indicated that interest rate cuts are likely in 2024 and beyond, although the timing and magnitude remain uncertain. Rate reductions will benefit the most rate sensitive lending products, particularly mortgage and to a lesser extent, auto and personal loans and also reduce interest payments to already leveraged consumers. Speaker 200:06:53Although demand for credit remains healthy, lending standards are still cautious. Some lenders have faced pressure from deposit outflows, rising delinquencies and concerns over potentially increasing capital requirements. The largest banks echoed this caution during recent earnings, expressing optimism for a soft landing, but forecasting modest loan growth. Grandgenia maintains strong positions across customers of all sizes and has enjoyed share gains in each market segment over the last decade. In our international markets, the UK, Canada and many of our Latin American countries are also experiencing slowing economic trends, Although we expect India to continue to outperform, we expect to deliver good results in this environment. Speaker 200:07:40We believe many of our services end markets are at or near their bottom. For 2024, we are assuming that economic conditions remain stable with steady albeit slower lending volumes. Any benefits from potential interest rate cuts and their impact on lending or marketing activity represents upside to our assumptions. Several factors underpin our confidence. First, we expect to realize the benefits of a strong sales year in 2023 and expect further momentum in 2024. Speaker 200:08:15Despite subdued volumes across many of our verticals in 'twenty three, our U. S. Sales team did an excellent job winning new business, culminating in strong sales in the 4th quarter for both financial services and our diversified markets. Customer demand remains strong across our verticals and solutions. 2nd, our vertical orientation provides diversification and growth levers that are independent of the lending environment and interest rate moves. Speaker 200:08:43We expect improving growth in our largest U. S. Emerging vertical, insurance, driven by new business wins and customers slowly restoring marketing spend. We have also meaningfully expanded the breadth and depth of our product portfolio. We continue to enhance our value proposition in core credit and to launch new fraud marketing solutions, which combine TransUnion and NuStar strengths. Speaker 200:09:11And Trusted Call Solutions is scaling rapidly with the potential for expansion internationally. 3rd, we expect strong revenue growth from international, which has grown revenues organically by double digits every year since our IPO except for in 2020 due to COVID. India is our largest international market and grew revenues to almost 220,000,000 in 20 up over 30% and contributing roughly 1.5 points to total company growth. We've grown more than 30% in India every year since 2017 with the exception of 2020. We expect all geographies to contribute to growth in 2024. Speaker 200:09:57And finally, This year, we expect to benefit from typical pricing actions, both our own and third parties. We also remain highly focused on increasing profitability by driving savings from our transformation program and acquisition synergies in addition to prudent cost management. Now key to our growth strategy is continuing to integrate NuStar successfully. Over the last 2 years, NuStar has been accretive to our U. S. Speaker 200:10:27Markets growth rate and has scaled its standalone margins significantly. In 2024, we expect NuStar to grow revenue by mid single digits. Our guidance assumes strong subscription revenue growth from our 'twenty three bookings and continued bookings momentum in 2024. But for soft volumes to persist in the more transactional parts of the business, which account for 20% of NuStar's revenue. We expect adjusted EBITDA margin at Newstar to be roughly 32% in 2024. Speaker 200:10:59We are allocating investment dollars to scaling fast across TransUnion. For this reason, we look at margin progress at U. S. Markets as the more relevant statistic. We continue to deliver cost synergies and as of the end of 2023 we achieved our 80,000,000 plus run rate target already above the $70,000,000 referenced at the time of acquisition. Speaker 200:11:32This does not include the benefits of material technology savings from our transformation program, which is enabled and accelerated by NuStar's state of the art data and analytics platform now called OneTrue. We continue to achieve key milestones that can accelerate growth at Neustar and across TransUnion in 2024 and beyond. Now we expect communication solutions to grow on the strength of Trusted Call Solutions or TCS. Since its launch in 2018, TCS has scaled to 80,000,000 in 23, up 30,000,000 or 60% over the prior year. We expect the business to grow over 40% in 2024. Speaker 200:12:20TCS is revolutionizing inbound and outbound voice calling for our customers, improving answering rates, reducing fraud, and increasing efficiency. Demand remains robust and we continue to win new customers across every vertical. Additionally, we're rolling out highly requested enhancements including displaying logos for business calls to consumers, which recently launched with AT and T and blocking spoof calls before they reach consumers. PCS is already a needle mover for U. S. Speaker 200:12:53Markets and total company growth rates and we see a clear right to win in what we believe could be a 1,000,000,000 addressable market in the U. S. Over the longer term. We also see broad application across several geographies and will soon be announcing our next international launch in one of TransUnion's largest markets. In marketing, We integrated 22 additional TEU and NuStar data assets into our new unified identity graph. Speaker 200:13:24Our entire marketing suite is now utilizing this unified graph that incorporates our best data. It enhances the depth, breadth and accuracy of consumer data across offline and online customer channels. With the newly improved adenograph, we cover 98% of the U. S. Adult population with 700 plus demographic attributes and are seeing a 20 plus percent increase in marketable phone numbers and emails and 50 plus percent increase in targetable addresses. Speaker 200:14:00This identity centric approach is resonating with customers, particularly as they contend with the reality of 3rd party during this transition differentiating with our highly authoritative first party identity data as well as direct integration into walled gardens and publishers with privacy enhancing technologies such as clean rooms and partnerships with cloud marketplaces such as Snowflake, Amazon Web Services and the Google Cloud. In Risk Solutions, we expect accelerating growth driven by strong bookings of our contact center products in the second half of twenty twenty three. We're consolidating NuStar's risk capabilities onto TrueValidate to deliver omni channel fraud mitigation and invested incrementally in go to market capacity. Our 3rd strategic focus area for 2024 is executing transformation initiatives. Since I became CEO in 2019, we have invested in global platforms across our product, operations, technology and data and analytics teams to build scale, foster knowledge sharing and develop standardized way of operating across the world. Speaker 200:15:26These initiatives accelerate innovation, streamline workflows, reduce costs and create better user experiences for customers and consumers. In November, we announced the next step of our transformation comprising 2 complementary programs. 1st, we will build upon our strategy of leveraging our global capability centers across the globe, driving workforce productivity and allowing us to provide more services from talent rich geographies like India, South Africa and Costa Rica. We grew our GCCs from 400 employees in 2019 to over 4,000 in 2023 and expect to transition over 1,000 additional roles over the next 2 years. We are balancing the need for customer centric work in market with the opportunity to centralize and standardize key global functions. Speaker 200:16:212nd, we will enhance our technology capabilities by completing our Project RISE cloud migration and leveraging Neustar's technology to consolidate our product and innovation enablement onto a common state of the art platform, 1 True. We expect this transformation to drive material revenue and cost benefits. By 2026, we expect to deliver $120,000,000 to $140,000,000 of annual operating expense savings with half of that realized in 2024. We also expect to reduce our CapEx spend from the historical 8% of revenue to 6% by 2026, the equivalent of $70,000,000 to $80,000,000 in annual cash savings. Now to achieve these savings, we expect to incur $355,000,000 to $375,000,000 of one time costs. Speaker 200:17:15This is inclusive of $65,000,000 already communicated Project RISE. In simple terms, we expect to deliver roughly $200,000,000 of ongoing annual free cash flow benefit for $300,000,000 of incremental one time costs. Just as importantly, these investments, particularly accelerate our innovation rates. One True will enable our growth strategy of extending further into marketing and fraud solutions. These 2 fast growing markets are highly synergistic with our core credit markets. Speaker 200:17:53Put simply, We're not a credit bureau attempting to play in the identity space. We are a consumer identity bureau applying these capabilities to credit data along with marketing and fraud solutions to serve our customers. We believe the complementary nature of credit, marketing and fraud will fuel growth across all three markets. One True will become the destination platform for activating our data assets in a single integrated technology stack across all global TransUnion product families from data ingestion, data management identity resolution to analytics and delivery. The platform is built on top of a foundational hybrid cloud infrastructure developed through Project RISE and leverages NuStar's architecture. Speaker 200:18:44One True is already live and powering TransUnion products And the next 2 years are about enhancing capabilities and consolidating more products, data and analytics onto the platform. We believe that OneTrue will improve our data quality, speed our time to market and accelerate innovation. From a cost perspective, OneTrue will also save costs enabling us to rationalize applications and standardize services. These efficiencies will allow our engineers to spend more time focused on innovation. This standardized operating model will also ensure a compliance and privacy first approach using embedded security guardrails. Speaker 200:19:28The One True platform is increasing our pace of innovation and enabling the next generation of products. Now let me highlight a few examples. In our True IQ analytics suite, we leverage OneTrue to improve the quality of our analytic services by reducing the time to insights and actions. In the past, we've discussed our True IQ Innovation Labs, where our scientists collaborate with customers in multi day hands on sessions infusing our data, analytics and domain expertise to solve their business problems. Last year, we ran a host of these labs on the One True platform. Speaker 200:20:08Clients benefited from real time interaction with our data and analytics for faster model development and deployment. The feedback has been very positive. By integrating our products on this common platform, We'll be able to serve clients' needs across multiple and previously siloed domains and convert our engagement seamlessly into ongoing revenues. We also recently launched True IQ data enrichment, which provides instant access to TEU data from within the customer's technology environment. This privacy first approach to data enrichment eliminates the need for sensitive client IP to leave their control. Speaker 200:20:48The solution streamlines access to credit and marketing data and accelerates model development. Advanced Acquisitions is a new offering that combines data enrichment with our credit and marketing capabilities for an integrated credit based prescreen solution. Advanced Acquisitions powers a full range of consumer acquisition tools including self-service batch prescreens, acquisition campaign model development and deployment and marketing audience definition, build and activation. TransUnion's media planning and measurement tools are also available on the OneTru platform to ensure effective marketing spend. We're also consolidating our fraud mitigation products globally onto 1 True in an integrated suite called TrueValidate. Speaker 200:21:42TruValidate combines our comprehensive identity data along with fraud signals from a range of Neustar and TU products in a single platform where we apply advanced analytics fueled by machine learning and AI to extract deep insights. Our result or rather the result has been a substantial improvement in fraud detection and a reduction in false positives. We're currently beta testing our first release and expect the full rollout this summer. Our fraud product suite serves thousands of customers around the world and represents roughly $300,000,000 of revenues against a multibillion dollar addressable market. We see substantial opportunity to gain share by offering a high performance integrated suite of solutions amplified by best in class analytics, which we believe will outperform the patchwork of point solutions that many customers use today. Speaker 200:22:38And finally, We're creating new and innovative marketing solutions in addition to the ongoing enhancements to our identity capabilities. True Audience Data Collaborations, which we formerly called Clean Rooms is a next generation offering to enable data collaboration between parties that don't want to directly exchange data, but must connect to partners across the advertising ecosystem. It's currently in market in beta testing and will fully launch later this year. Client feedback is enthusiastic and we're working with the walled gardens to drive adoption. I look forward to providing you updates on these product advancements in the coming quarters. Speaker 200:23:18And with that, I'll turn it over to Todd, who'll provide further details on our Q4 financial results, our Q1 and full year 2024 outlook. Todd? Speaker 100:23:29Thanks, Chris, and let me add my welcome to everyone. Speaker 300:23:32As Chris mentioned in the Q4, we exceeded our guidance on all key financial metrics. 4th quarter consolidated revenue increased 6% on a reported basis and 5% on an organic constant currency basis. There was no impact from acquisitions and a less than 1% benefit from foreign currency. Our business grew 4% on an organic constant currency basis, Excluding mortgage from both the Q4 of 20222023, Adjusted EBITDA increased 1% on a reported and constant currency basis. Our adjusted EBITDA margin was 34.2% ahead of our expectations, but down 140 basis points compared to the year ago 4th quarter due to lower services volumes, which have high margin flow through. Speaker 300:24:314th quarter adjusted diluted EPS increased 2%. Adjusted effective tax rate was 21.4% in the quarter and 22% for the full year below our 23% guidance due to successful tax planning efforts. Finally, in the Q4, we took $78,000,000 in one time charges related to the next phase of our transformation. The first expenses and what we expect to be a $355,000,000 to $375,000,000 program, inclusive of the final year of Project Rise. These 4th quarter charges were primarily related to employee separation with a modest amount related to office closures. Speaker 300:25:20I will provide more color on expectations for charges in 2024 during the guidance section. Before I get into U. S. Markets, a reminder that we report NuStar revenue within our vertical market structure. As we've stated previously, starting in 2024, we will stop providing standalone Neustar quarterly revenue growth rates and adjusted EBITDA margins. Speaker 300:25:47We will, however, provide updates to our full year targets to achieve mid single digit revenue growth in 2024. Looking at segment financial performance for the Q4, U. S. Markets revenue was up 3% compared to the year ago quarter. Adjusted EBITDA for U. Speaker 300:26:07S. Markets was flat and adjusted EBITDA margin was down 80 basis points to 33.2%. Financial Services revenue grew 3% with activity broadly consistent with the levels seen late in Q3. Consumer lending revenue declined 3%. Online activity remains soft, but batch marketing has seen some modest improvement among our FinTech customers, a sign that players are cautiously anticipating growth. Speaker 300:26:42Our credit card and banking business was down 5%. While issuance is healthy on a historical basis, Online and batch activity remains tempered as lenders contend with credit normalization, deposit pressures and potential capital constraints. We are seeing stronger activity from our largest customers compared to a more conservative approach by mid market and smaller institutions. We continue to retain and win share across our customers with momentum in fraud and identity solutions. Our auto business grew delivered 1% growth on top of 16% growth in the prior year quarter. Speaker 300:27:26New car sales in the U. S. Totaled $15,500,000 in 2023, up 12%, but still below the roughly $17,000,000 of annual sales seen from 2015 to 2019. Sales are expected to increase modestly in 2024. The higher level of new car sales will still take time to replenish The used car market, which saw declining sales in 2023 and continues to face availability and affordability challenges. Speaker 300:28:01Used car prices were down in 2023, but are still 30% above pre pandemic levels. The used car market currently accounts for almost 60% of finance vehicles in the U. S. For mortgage, revenue was up 34% in the quarter against inquiry volume declines of 11%. The pace of volume decline slowed throughout the year, but for the year applications were over 50% below 2019 levels and existing home sales were the weakest since 1995. Speaker 300:28:40Average mortgage rates after topping 8% in late October have fallen to 6.5% to 7% range. Rates remain high in a recent historical basis, which combined with elevated home prices and low inventory will likely limit activity. On a trailing 12 month basis, mortgage represented about 7% of total TransUnion revenue. Let me now turn to our emerging verticals, which grew 2% in the quarter. Churns delivered mid single digit growth in the 4th quarter and 4% for full year 2023 with trends stable and in line with expectations in the 4th quarter. Speaker 300:29:25In 2024, we expect to deliver improving growth with momentum as the year progresses. After 2 years of contracting marketing activity, we expect carriers to slowly restore marketing spend as rate adequacy improves And while consumer shopping activity remains robust, we continue to deliver significant new business wins across our core products as well As with innovative products like TruVizion driving history and successful cross selling of Neustar and Sontiq solutions. Tech, Retail and E Commerce and Telco both grew low single digits. Tech, Retail and E Commerce benefited from Trusted Call Solutions wins and good fraud and identity volumes from e commerce customers, while caller ID drove growth in telco. Media was flat as usage based volumes for our audience solutions remain soft. Speaker 300:30:31Across our other emerging verticals, services and collections and public sector both grew double powered by strong growth in trusted call solutions. And unemployment screening declined As we work through the recalibration of our solutions, we are working to provide the most customer and consumer friendly approach possible And we believe it will create a long term competitive advantage, particularly as regulators push for more consistent and compliant data usage across vendors. Consumer Interactive revenue increased 7%, benefiting from a large Breach win. We continue to grow our Breach business largely on the strength of the SonTic offerings. Reach revenues can be uneven, but are increasingly the byproduct of proactively selling recurring cyber protection programs to companies through cyber insurance providers. Speaker 300:31:31Breach response engagements also provide new engagements with consumers with opportunities to cross sell them into credit education and identity protection programs. Excluding the large breach win, Revenue would have declined 2% in line with our expectations and the current run rate of the business. Adjusted EBITDA margins were 45.5 percent down 580 basis points due primarily to the impact of the Breach win. Our direct business continues to decline as we recalibrated our marketing approach to focus on higher value consumers. So far, we've seen good returns on the revamped approach. Speaker 300:32:20We continue to work to improve our value proposition and go to market strategy in this business. Our indirect business grew led by SanTec, which grew double digits in the 4th quarter and over 20% for the full year. In addition to stronger than expected breach revenue, Sontiq's identity protection business grew double digits. For our traditional credit education products, performance across customers varied based on the idiosyncratic market dynamics. Lenders continue to be selective in utilizing offer aggregators in other channels for marketing. Speaker 300:33:03For my comments about international, all revenue growth comparisons will be in constant currency. For the total segment, revenue grew 13 percent with 4 of our 6 reported markets growing by double digits. Adjusted EBITDA margin was 44%, up 20 basis points. Now let's dig into the specifics for each region. In India, we grew 30%, reflecting strong market trends and generally healthy consumers. Speaker 300:33:31We continue to win share in core consumer credit with an expanding suite of credit oriented solutions as well as increased penetration of small and medium lenders. This strong core performance is complemented by meaningful growth across commercial, credit, fraud, marketing and direct to consumer offerings. We now generate over a third of our India revenue outside of consumer credit, a testament to the success of taking our growth playbook to the Indian market. We expect another very strong year from India in 2024. In the U. Speaker 300:34:10K, revenue was flat. The U. K. FinTech market remains challenged, but we continue to see good growth in banking and insurance as well as share gains and wins with products like TruVizion, Trended Data and our consumer offerings. Our Canadian business grew 14% despite a tepid macro environment substantially outperforming flat slightly declining lending market growth. Speaker 300:34:39We benefited from share gains in financial services, strong growth in telco and insurance and continued momentum in direct to consumer, including recent breach wins. Material portion of the outsized Growth in Canada in 2023 came from sizable share wins, which will be fully annualized in 2024. For 2024, we expect healthy mid single digit growth and continued market outperformance. In Latin America, revenue was up 5%. Brazil was down in the quarter due to weakness in the FinTech market. Speaker 300:35:19In Colombia and our other Latin American countries, We delivered good growth across online and batch despite softening market conditions with wins across financial services, government and insurance. In Asia Pacific, we grew 13% led by very strong growth in the Philippines where we see attractive market growth and increased customer penetration. Hong Kong also had another solid quarter. Finally, Africa increased 11% based on a broadly strong performance despite a challenging environment in several of our largest markets. Turning to the balance sheet. Speaker 300:36:02We ended the quarter with roughly $5,300,000,000 of debt after prepaying $25,000,000 in the quarter for a total of $250,000,000 in 2023. Looking back, since we announced the acquisition of NuStar in September of 2021, we've prepaid about $1,500,000,000 of debt. That left us with $480,000,000 of cash on the balance sheet. We finished the quarter with a leverage ratio of 3.6x. In October, we completed the refinancing of our revolving credit facility and Term Loan A. Speaker 300:36:44In addition to extending our maturities from 2024 to 2028, We expanded our revolver from $300,000,000 to $600,000,000 and our term loan A from $1,000,000,000 to $1,300,000,000 We used the incremental $300,000,000 raised for our Term Loan A to prepay $300,000,000 of our higher coupon term loan B6. Last week, we repriced our term loan B6 reducing our credit spread by 25 basis points and removing the credit spread adjustment. The combined impact of these 2 refinancings results in roughly $8,000,000 of annual interest expense savings. Net of our swaps, our average effective cost of debt at today's sulfur rate is roughly 5%. You can find our updated debt profile in the appendix of our presentation. Speaker 300:37:50We continue to focus on the integration of our recent acquisitions and have no intention to make large scale acquisitions this year. Our priority is to prepay debt in 2024 with our excess cash flow. However, We expect prepayments to be lower than 2023 due to the one time cash payments related to our transformation program. Cash outlays related to our 4th quarter cost actions were minimal and we expect most of our $355,000,000 $375,000,000 of one time expenses to be paid out in 2024. Based on our expectations for adjusted EBITDA and cash generation, we expect our leverage ratio to be in the low three time range by the end of 2024. Speaker 300:38:42We continue to work toward our leverage ratio target of under 3 times. We do not view 3 times as an ending point for deleveraging and view debt prepayments as the best incremental use of our cash over the medium term. Turning to guidance, I wanted to first explain our philosophy for 2024. When we provided Q4 2023 guidance in October, we were deliberately very conservative following a challenging third quarter. Our guidance for the Q1 and full year 2024 reflects more typical TransUnion conservatism. Speaker 300:39:23We are assuming the current slower conditions persist throughout the year. Should interest rate cuts occur and drive increased lending and marketing activity that would represent upside to our current guidance. That brings us to our outlook for the Q1 of 2024. We expect FX to have an insignificant impact on revenue and adjusted EBITDA. We expect revenue to come in between $971,000,000 $980,000,000 or up 3% to 4% on an as reported and organic constant currency basis. Speaker 300:40:03Our revenue guidance includes 1 point of tailwind from mortgage, meaning that we expect the remainder of our business will be up 2% to 3% on an organic constant currency basis. We expect adjusted EBITDA to be between $324,000,000 and $331,000,000 up 1% to 3%. We expect adjusted EBITDA margin of 33.4% to 33.8% or down 50 to 90 basis points. Margins are expected to be down sequentially and year over year due to the timing of expenses in international, particularly India, as well as consumer interactive. We expect year over year margin expansion in our U. Speaker 300:40:51S. Markets business in the Q1. We expect the Q1 to be our lowest margin quarter with margins expanding each quarter as transformation savings build throughout the year. We also expect our adjusted diluted EPS to be between 0.79 $0.81 a range of down 2% to up 1%. Turning to the full year, we expect insignificant impact from FX on revenue and adjusted EBITDA. Speaker 300:41:25We expect revenue to come in between $3,960,000,000 $4,020,000,000 or up 3% to 5% on an as reported and organic constant currency basis and up about 1.5% to 3.5% excluding the impact of mortgage. For 2024, we expect mortgage inquiries to be down roughly 5% and our revenues to increase roughly 25%, primarily due to the impact of 3rd party Scores pricing. We expect inquiries to be down roughly 15% in the first half of the year and up roughly 10% in the second half of the year as comparisons ease. For our business segments, we expect U. S. Speaker 300:42:15Markets to grow mid single digit or low single digit excluding mortgage. We anticipate financial services to be up mid single digits or up low single digits excluding mortgage. We expect emerging verticals to be up low single digits. We anticipate that international will grow high single digits in constant currency terms driven by the same positive trends that we saw throughout 2023. And we expect Consumer Interactive to decline low single digits. Speaker 300:42:49Turning back to total company outlook, We expect adjusted EBITDA to be between $1,398,000,000 $1,441,000,000 up 4% to 7%. That would result in adjusted EBITDA margin being 35.3% to 35.8% or up 25 basis points to 75 basis points. We anticipate adjusted diluted EPS to be 3 point $3.74 up 6% to 11%. We expect our adjusted tax rate to be approximately 22.5%. Depreciation and amortization is expected to be approximately $530,000,000 and we expect the portion excluding step up amortization from our 2012 change in control and subsequent acquisitions to be about $245,000,000 We anticipate net interest expense will be about $245,000,000 for the full year, down over $20,000,000 year over year, primarily due to our 2023 debt prepayments, recent refinancings and lower sulfur. Speaker 300:44:06We expect to take an incremental roughly $200,000,000 in one time charges in 2024 related to our transformation program. Combined with $78,000,000 charges in the Q4, we expect a total of roughly $280,000,000 spent through 2024 compared to 3 $55,000,000 to $375,000,000 of total program costs, which are expected to be completed in 2025. We expect capital expenditures to be about 9% of revenue. I want to wrap up with some additional detail about our expectations for adjusted EBITDA in 2024. A key driver of adjusted EBITDA growth is flow through from higher revenue, inclusive of continued investment in the business. Speaker 300:44:57Based on the high end of our guidance, we expect to grow revenues by roughly $190,000,000 and adjusted EBITDA by $65,000,000 While we are adding absolute adjusted EBITDA dollars, The lower than typical incremental margin is due to mix of revenue growth outside of core credit as well as targeted investments primarily to support the strong growth in our international segment. When lending activity picks up, we expect to see strong incremental margins. 2nd positive is savings from our transformation program, which we expect to deliver roughly $65,000,000 in benefit, In line with our commitment in November, we expect the savings benefit to build throughout the year. We also expect $20,000,000 to $25,000,000 of benefit from continued NuStar acquisition synergies as well as reduced Santic and Argus integration costs in 2024. Partially offsetting these positives is resetting our annual incentive compensation costs to target after a below target payout in 2023 in addition to annual merit increases. Speaker 300:46:16Taken together, we expect a good year for adjusted EBITDA growth with expected additional transformation savings still to come and further upside if we see any step up in credit volumes. I'll now turn the call back to Chris for some final comments. Speaker 200:46:33Thank you, Todd. To wrap up, we exceeded 4th quarter expectations driven by stable lending and marketing conditions in the U. S. And robust growth from international. We expect a strong year in 'twenty four with mid single digit revenue growth and high single digit adjusted diluted EPS growth. Speaker 200:46:52We're focused on 3 strategic priorities for the year to create value for TEU, accelerating revenue and earnings growth, leveraging NuStar's product and technology capabilities further and executing on our transformation initiatives. Finally, on a personal note, as many of you know, Aaron Hoffman has decided to retire from TransUnion in March. Aaron has been instrumental in building out the Investor Relations function at TU and has been a valuable resource to our management team and to investors alike. We've been lucky to have him over these last 8 years and we wish him a happy retirement. We're also excited to have Greg Barty who has been working with Aaron these last 3 years and covered TransUnion on the sell side before that, leading our Investor Relations going forward. Speaker 200:47:41Now let me turn the time over to Aaron. Speaker 100:47:43Thanks, Chris, and thanks for those kind words. I appreciate that very much. So that does conclude the prepared remarks today. And for the Q and A, as always, we ask that you ask only one question so that we can include more participants. And operator, we can begin the Q and A now. Operator00:48:01Thank you. And today's first question comes from Jeff Meuler with Baird. Speaker 400:48:28This is Steven Pollack on for Jeff. I guess, what Do you need to see or what are your clients that they need to see in order for NuStar transactional revenue to improve or bounce back? Speaker 500:48:43Yes. Good morning, Jeff. I think I'll start answering that. Oh, it's Steven. Yes. Speaker 500:48:51On the NuStar front, the headwind to hitting our growth targets there beyond mid single digits has been The decline in the transactional components of the portfolio. In a more difficult economic environment, Marketing and advertising activity has pulled back. In addition to the volume slowdown, we've seen clients working to reduce data costs, right, and relying more on first party data. So both of those have been headwinds to our sales. We've compensated a bit for the cutback on the data side by selling more first party record hygiene and identity resolution services. Speaker 500:49:34So really what we need is, I think, a stable floor in those areas and perhaps some rebound in activity. The guidance that we provided at NuStar is consistent With our overall guidance this period, it's intended to be conservative, yet constructive. We're pushing to exceed that guidance and we hope we'll be able to over the course of the year. Operator00:50:07Thank you. And our next question today comes from Andrew Steinerman with JPMorgan. Please go ahead. Speaker 600:50:13Hi, Chris. Could you jump into the consumer interactive guide for 2024? Just maybe Expand on what your expectations are more than just the numbers? And then inside the numbers, what are you assuming in terms of indirect growth Consumer Interactive and when do you expect direct to return to growth? Speaker 500:50:35Yes. So obviously, Andrew, we have been navigating a pivot in the consumer business over the past 18 months or so. Part of that is the direct business, which has been in decline, in part because of market demand shifting more toward freemium, but also some adjustments in our marketing practices. That area has been the most pronounced decliner. Where we're at now is we can see it getting to kind of a neutral state over the course the year, sometime probably mid second quarter, a combination of reaching an equilibrium on our marketing practices and enjoying the benefits of the annual price and the like. Speaker 500:51:23We expect indirect to remain kind of a low single digit grower over the course of the year. And of course, breach protection and identity protection through our NuStar acquisition I'm sorry, the Versysic acquisition is doing particularly well. It grew over 20% last year, had a really strong Q4. Again, think of the consumer guide in total in the context of an overall conservative corporate guide, right, where we're steering more toward the high end of things. And look, I think it's important just to emphasize in the big with regard to TU in the consumer space is that we believe we will return this business back to consistent positive organic growth, and we intend to compete across the full dimension of opportunities, whether that be, identity protection, premium offerings, and the like. Operator00:52:32Thank you. And our next question today comes from Fema Auli with Deutsche Bank. Please go ahead. Speaker 700:52:39Yes. Hi, good morning. Thank you. I wanted to ask about U. S. Speaker 700:52:44Financial Services And the growth that you are assuming there for 2024, just give us some color around how We should think about auto card, consumer lending and we didn't touch on Argus, so curious What your expectations are there? Thanks. Speaker 500:53:05Sure. So in U. S. Financial Services, I mean, look, as we know, There was a year of turmoil in 2023. Not only were we dealing with the impact of inflation and much higher interest rates, which slowed demand, but we're also dealing with Deposit outflows from certain segments in banking because of the instability that we experienced in the second quarter, That led to a material slowdown in September of last year. Speaker 500:53:37We modeled a continuation of that slowdown in the 4th quarter, in fact, deterioration from that rate, it turned out that that was a bit conservative and we over performed that as you can see. Turning to 24, we think we're at or near a floor in most of these services, But we're not assuming any improvement, right? So we've kind of budgeted for steady volume across the different subcategories of financial services in the U. S. Over the course of the year. Speaker 500:54:14Now growth rates are going to improve in the second half because comparables are easier in the second half, and of course, by the second half, we're getting the full benefit of price actions of both our own and third parties. But it's kind of a steady sailing forecast, if you will. We're not building in any uplift from the potential for interest rate reductions by the Fed. Operator00:54:44Thank you. And our next question today comes from Toni Kaplan with Morgan Stanley. Please go ahead. Speaker 800:54:50Terrific. Thank you. I was hoping you could talk about your expectations for the FinTech environment through 'twenty four. I know you talked about some modest improvement in batch that you're seeing, but still challenges in the UK. So just hoping to get a little more color on where you see FinTech in particular go from here. Speaker 800:55:10Thanks. Speaker 500:55:12Yeah. Well, last year was an especially difficult one for FinTech, largely because of the increase in borrowing costs and the difficulty of getting funding. But I think also some concerns about the health of the consumer from the Q3 forward. We saw a pretty material reduction here in the U. S. Speaker 500:55:34That segment probably fell roughly 20% last year. Again, our assumptions for 2024 are more or less steady from the volumes that we experienced in the 4th quarter. We're encouraged by the stability that we're seeing and we're encouraged by the uptick in some batch activity, which suggests that there will be more marketing activity in the space, but we haven't modeled too much of that optimism into the guide. Speaker 400:56:07And just to add on to that, Tony, just to provide some sizing for FinTech. We talked about in 2022 that we did about 100 and $75,000,000 last year in the U. S. We're talking about. And We brought it last year, we saw it come down to $140,000,000 So that's the 20% that Chris is referring to. Speaker 400:56:34The reason for bringing that out is TransUnion has a very nice position with FinTechs that we've spoken about and our team has done Speaker 500:56:42a great Speaker 400:56:42job building those relationships. And in the whole scheme of our revenue, it's less than 4 percent of the overall company's revenue. So just wanted to make certain that was appropriately sized in response to your question. We see tremendous opportunity though for us as we believe that those customers are on a path to growing again and we're best positioned to take advantage of that. Speaker 500:57:07And you also mentioned the UK. I mean, clearly, it was even more difficult here. You had a number of players that exited the market. That impacted our overall. As I said, in the UK, we're continuing high single digit growth. Operator00:57:28Thank you. And our next question today comes from Kelsey Xu with Autonomous Company. Please go ahead. Speaker 900:57:35Hi, good morning. Thanks for taking my question. 1 of your peers has highlighted headwinds to their mortgage pre revenues in 2024 because soft pull ups are getting really I was wondering if you're expecting similar happens in that space in 2024 and how big prequalification revenues would be for mortgage for TransUnion? Speaker 500:58:03Hey, Kelsey. I think I followed the question. We had a little bit of a technical glitch here, but I think you're talking about mortgage headwinds due to a rollout of the single bureau prequalification that the FHFA has sponsored. We have modeled that into our assumptions. So it is baked into the guide that we have provided. Speaker 500:58:31We expect that it will cause some volume deterioration. But again, that's factored into well, that's just one factor in our process of estimating where we think mortgage volumes will be. So we look at all of the publicly available information. We talk to our client advisory board. We've got the recent historical trajectory of this. Speaker 500:58:57And then we have made some adjustments for an industry wide adoption of a single euro pool at prequalification. Operator00:59:08Thank you. Our next question comes from Ashish Sabadra with RBC Capital Markets. Speaker 1000:59:17Just wanted to focus down or drill down further on the emerging verticals. You mentioned the win in insurance and pretty good momentum there, but how should about the puts and takes? And for the rest of the emerging verticals, can you talk about some puts and takes in 2024? Thanks. Speaker 400:59:36Sure. Yes, Ashish, I'll take that one from you. So the I think the heart of your question really comes down guidance that we provided for the emerging verticals and that we're assuming to be low single It's really the way to think about that. The way we look at it, as we break the emerging vertical different segments. And you alluded to already insurance. Speaker 401:00:03We're expecting insurance to have a healthy year in 2024. The team has signed many new clients, so there's significant new business wins that will come to fruition As we spoke about in our prepared remarks, marketing is improving slowly, but we're so cautiously optimistic about that and shopping activity remains strong. So all in all, insurance we're expecting a good year probably in the mid digits of growth. Also in the emerging verticals, we're expecting good growth in services and collections as well as in our public sector verticals. And a lot of that growth is coming from trusted call solutions where we've seen significant meaningful growth and obviously that's the capability that came with the Star acquisition. Speaker 401:00:57So those 3 verticals of insurance services and collections and public sector represent about 40% of the revenue. So that means the other 60% we talked about, expected growth out of those 3. So And then other 60%, the areas our tenant and employment Here, as you're well aware, to recalibrate Due to a consent order that signed with the CFPB, updated our products to provide a these reports that we provide in space. But I think it's a little bit of time that probably more maybe in the second half of the year Get back to the growth expectations. 2nd thing that is The communication verticals where much of new start see capabilities with them. Speaker 401:02:18So think of ColorEdge TransUnion now provides to the health department. That's kind of a flattish business and it's also a bigger. So needless to say that Speaker 501:02:33to the growth rate. And also Speaker 401:02:37the media vertical It also has tempered expectations for us in 2024. What Chris spoke about earlier, we'll be on this generation. It's very volume dependent. So if there's a recovery coming on the marketing side, And that would be something that we would undertake. By highlighting those 3, because those are the 3 where our expectations are a little bit And consistent with the guidance that we've provided for the year, this is just where we're being Speaker 501:03:35A couple of color points on emerging. Employment where we signed this consent order saw revenue turn negative as we had continue certain products. CFPB subsequently has issued guidance to the industry That conforms very tightly to the consent order that we signed, And we're seeing other industry players adopt similar adjustments and curtailments to the type of information that they're providing. And we think it's a good news. We think CPD levels the plane. Speaker 501:04:15Once we lap changes we're going to return to growth. One thing I would mention, the communications part of the wallet is like growth overall, Those services that we provide, while they mature, they're extremely profitable and most importantly, feedstock Operator01:04:46Thank you. And our next question today comes from Manav Patnaik with Barclays. Please go ahead. Speaker 601:04:53Yes, thank you. I just had Speaker 1101:04:55a question on mortgage plus pricing, I guess. The down 15% in the first half, that just seems like kind of continuation what you saw in the Q4. Just wanted to confirm the plus 10% in the second half. Was that purely comps? Or is there some other assumption you've made in there? Speaker 1101:05:11And then I think in your prepared remarks, you said pricing going up from your own and third party. I think we know the 3rd party, but just wanted some more clarity on where your open pricing is going up and how much? Speaker 401:05:29Manav, this is Todd. Can you hear me okay? I can Speaker 1101:05:33hear you now. It's a little muffled while you're Speaker 401:05:39Okay, great. So I'm going to I'll speak louder. So as far as the assumptions that we have pertaining to our volumes, we are assuming that we're going to grow We're going to be down 10% in the first half, but up 15% in the second half, I'm just reiterating and then down 5% for the full year. The assumption is just purely on the comparisons in the second half of the year. There's no we're not banking on any type of recovery in mortgage. Speaker 401:06:15It's more kind of the same, right? And just to provide a little bit more context on that, when we build our assumptions for mortgage, we're looking at this across Multi dimensions. The first being our own team, and what they're seeing in the market. The second, being a mortgage advisory board. This is where we're hearing directly from our customers as it pertains to what their And then the third area is where we look at outside data sources like you do. Speaker 401:06:51So for example, the Mortgage Bankers Association. So Speaker 501:06:55you take those three elements Speaker 401:06:57and that's how we come up with our guide. The second part was Speaker 501:07:05about the pricing. I'll wait here because I didn't hear it. Mean, obviously, Manav, as you well know, 3rd party pricing is the biggest driver of price increases in mortgage and has been for the last couple of years. Our comment about our own pricing, you should think of it as more or less consistent with our annual pricing practices. And then again, again, as we all know, if the Fed were to lower rates, mortgage volumes is probably the first area where we would see some uptick. Operator01:07:39Thank you. And our next question today comes from Owen Lau with Oppenheimer. Please go ahead. Speaker 1201:07:45Hey, good morning. Thank you for taking my question. Can you please go back to your weighted assumption? Are you assuming no rate cut currently? I mean, if there are 3 rate cuts that's the Fed is projecting right now or even more than 3 just like what the market is pricing in, how should we think about the incremental benefit in revenue and also EPS in 2024? Speaker 1201:08:07Thank you. Speaker 401:08:09Yes. Owen, as it pertains to our interest rate assumption, we are not assuming that the business gets any benefit from interest rate cuts. So think of that as if the interest rates come and there is an uptick in lending that would all be upside to the guidance that we provided this morning. Speaker 501:08:36Yes. Look, this is an opportunity, I think, for us to just provide some context and clarification on the nature of the guidance. It's 3% to 5% organic. Clearly, Todd and I feel the odds are more towards the high end of that range. And again, we wanted to be Given the environment in which we're operating, we're not Modeling in volume increases due to rate cuts that would all be upside and we're steering the business toward what we hope will be outperformance. Operator01:09:13Thank you. And our next question today comes from Andrew Nicholas with William Blair. Please go ahead. Speaker 1301:09:19Hi, good morning. Thank you for taking my question. I just wanted to ask on NuStar margins specifically, I think You guided to 32% this year historically or I guess previously you talked about a 40% margin target. Just wondering kind of if that's still within the realm of expectations over the medium term, what will it take to get up to that level, recognizing that you've already gotten the $80,000,000 plus of cost savings in the run rate, just an update there would be helpful. Thank you. Speaker 501:09:55Yes, for sure. So the guide to NuStar margins getting to the level of the full enterprise, at least peak margin performance was more in the context of a 4 to 5 year period, right? We've had 2 years of ownership. We've added 1,000 basis points. We're headed toward 32% this year. Speaker 501:10:15And while we've achieved the $80,000,000 in cost reductions, Look, we think there's more juice in the squeeze, so to speak. We're not formalizing it. We're not guiding to it. The other factor that's going to give us material margin upside is as the revenue growth rate increases in NuStar, Assuming we start to enjoy flattish market conditions on the marketing side and get some uplift On the risk side, through all of the innovation that we've done with our fraud mitigation suite, we're going to get higher flow through that's going to help drive margins up to that initial post acquisition guide. Speaker 401:11:00Great. And that brings us to the end of the call today as we're bumping up towards the top of the hour and a very busy day of earnings for everyone. I want to thank you for your time today and wish everybody a good rest of the day. Thank you very much. Operator01:11:14Thank you. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallTransUnion Q4 202300:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Annual report(10-K) TransUnion Earnings HeadlinesAs Federal Collections Activity Resumes, More Than One in Five Federal Student Loan Borrowers With a Payment Due are Seriously DelinquentMay 5 at 7:00 AM | globenewswire.comFour in 10 Consumers Now Expect Personalized Marketing ExperiencesMay 1, 2025 | globenewswire.comTrump Orders 'National Digital Asset Stockpile'Trump's tariffs on China have caused a ripple effect across global markets. But in crypto? They've lit a fuse. We're entering a new phase where economic uncertainty and technological transformation collide — and blockchain adoption is gaining steam from the highest levels of finance. Amid this shift, I've zeroed in on one standout coin.May 6, 2025 | Crypto 101 Media (Ad)TransUnion (NYSE:TRU) Price Target Cut to $112.00 by Analysts at Stifel NicolausApril 28, 2025 | americanbankingnews.comTransUnion (NYSE:TRU) Price Target Raised to $96.00April 28, 2025 | americanbankingnews.comDecoding TransUnion (TRU): A Strategic SWOT InsightApril 27, 2025 | gurufocus.comSee More TransUnion Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like TransUnion? Sign up for Earnings360's daily newsletter to receive timely earnings updates on TransUnion and other key companies, straight to your email. Email Address About TransUnionTransUnion (NYSE:TRU) operates as a global consumer credit reporting agency that provides risk and information solutions. The company operates through U.S. Markets, International, and Consumer Interactive segments. The U.S. Markets segment provides consumer reports, actionable insights, and analytic services to businesses, which uses its services 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 mitigate fraud risk. This segment serves various industry vertical markets, including financial services, technology, commerce and communications, insurance, media, services and collections, tenant and employment, and public sectors. The International segment offers credit reports, analytics, technology solutions, and other value-added risk management services; consumer services, which help consumers to manage their personal finances; consumer credit reporting, insurance and auto information solutions, and commercial credit information services. It serves customers in financial services, retail credit, insurance, automotive, collections, public sector, and communications industries through direct and indirect channels. The company was formerly known as TransUnion Holding Company, Inc. and changed its name to TransUnion in March 2015. 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There are 14 speakers on the call. Operator00:00:00Good day, and welcome to the TransUnion 2023 4th Quarter Earnings Conference Call. Please note, today's event is being recorded. I would now like to turn the conference over to Aaron Hoffman, Senior Vice President of Investor Relations. Please go ahead. Speaker 100:00:40Good morning, everyone, and thank you for attending today. Joining me on the call are Chris Cartwright, President and Chief Executive Officer and Todd Sello, Executive Vice President and Chief We posted our earnings release and slides to accompany this call on the TransUnion Investor Relations website this morning, they can also be found in the current report on Form 8 ks that was filed this morning. Our earnings release and the accompanying slides include various schedules, which contain more detailed information about revenue, operating expenses and other items as well as certain non GAAP disclosures and financial measures along with the corresponding of these non GAAP financial measures to their most directly comparable GAAP measures. Today's call will be recorded and a replay will be available on our website. We will also be making statements during this call that are forward looking. Speaker 100:01:29These statements are based on current expectations and assumptions and are subject to risks and uncertainties. Actual results could differ materially from those described in the forward looking statements because of factors discussed in today's earnings call, In the comments made during this conference call and in our most recent Form 10 ks, Forms 10 Q and other reports and filings with the SEC, We do not undertake any duty to update any forward looking statement. Also in early January, we filed an amendment to our 3rd In today's earnings release, we have included information on a revision primarily related to our cost of services and SG and A expenses. We plan to file our 2023 10 ks by the end of the month. So with that out of the way, let me turn the time over to Chris. Speaker 200:02:20Thanks, Aaron, and let me add my welcome and our agenda for the call this morning. First, I will provide the financial highlights for our Q4 2023 results. 2nd, I will detail our 2024 strategic priorities to drive value across TEU. And finally, Todd will detail our 4th quarter results along with our Q1 and full year 2024 guidance. In the 4th quarter, we exceeded our guidance across revenue, adjusted EBITDA and adjusted diluted EPS. Speaker 200:02:53Revenue grew 5% on an organic constant currency basis with growth across all segments. U. S. Markets grew 3% with financial services up 3% and emerging verticals at 2%. In Financial Services, lending and marketing activity remained consistent with the levels seen late in the 3rd quarter with no further deterioration in volume. Speaker 200:03:17In emerging verticals, insurance improved to mid single digit growth driven by new business wins. Services and collections and public sector both grew double digits. NuStar delivered 4% growth in the quarter in line with our expectations and accretive to our U. S. Markets growth. Speaker 200:03:35Communication remains a standout driven by Trusted Call Solutions, which grew almost 50% in the quarter. In Marketing and Risk Solutions, our subscription base remains healthy and bookings in the second half of the year were strong, which offsets still soft transaction revenues. For the year, Newstar grew revenues by 5% and expanded adjusted EBITDA margin to 31%, up a 1,000 basis points in our 2 years of ownership. Our International segment grew by 13% on a constant currency basis in the 4th quarter, the 11th consecutive quarter of double digit growth. We continue to outperform our underlying markets because of innovation, share gains and expansion into new adjacencies. Speaker 200:04:22India led with 30% revenue growth, while Canada, Asia Pacific and Africa grew double digits as well. In November, we launched the next phase of our transformation program focused on growing our global capability center network and enhancing our technology capabilities. We expect this transformation to deliver significant operating expense savings and reduce capital expenditures by 2026, while accelerating innovation and enabling growth. I will share more detail on this program shortly. We prepaid another $25,000,000 of debt during the quarter for a total of $250,000,000 in 2023. Speaker 200:05:05Also completed refinancings in October February that will reduce our annual interest expense by $8,000,000 in 2024. Looking back at the full year of 'twenty three, we delivered good results and achieved key transformation milestones despite challenging environment for many of our geographies and end markets. Our performance highlights the resiliency of our business model, the relevance of our innovations innovative solutions and the benefits of our vertical product and geographic diversification. As we turn to 2024, we believe 3 strategic priorities will create significant value for TransUnion and our shareholders. The first is to accelerate revenue and earnings growth. Speaker 200:05:49The second is to leverage NuStar's product and technology capabilities further. And the third is to execute the transformation initiatives that we announced in November. Let me spend a bit more time discussing each. Now Todd will provide full financial guidance, but at a high level, we expect to deliver 3% to 5% revenue growth, 4% to 7% adjusted EBITDA growth and 6% to 11% adjusted diluted EPS growth. We expect economic growth to moderate in 2024 and lending volumes to remain steady. Speaker 200:06:24Consumer finances in the U. S. Remain healthy due to low unemployment and real wage growth. Inflation has moderated and the Fed has indicated that interest rate cuts are likely in 2024 and beyond, although the timing and magnitude remain uncertain. Rate reductions will benefit the most rate sensitive lending products, particularly mortgage and to a lesser extent, auto and personal loans and also reduce interest payments to already leveraged consumers. Speaker 200:06:53Although demand for credit remains healthy, lending standards are still cautious. Some lenders have faced pressure from deposit outflows, rising delinquencies and concerns over potentially increasing capital requirements. The largest banks echoed this caution during recent earnings, expressing optimism for a soft landing, but forecasting modest loan growth. Grandgenia maintains strong positions across customers of all sizes and has enjoyed share gains in each market segment over the last decade. In our international markets, the UK, Canada and many of our Latin American countries are also experiencing slowing economic trends, Although we expect India to continue to outperform, we expect to deliver good results in this environment. Speaker 200:07:40We believe many of our services end markets are at or near their bottom. For 2024, we are assuming that economic conditions remain stable with steady albeit slower lending volumes. Any benefits from potential interest rate cuts and their impact on lending or marketing activity represents upside to our assumptions. Several factors underpin our confidence. First, we expect to realize the benefits of a strong sales year in 2023 and expect further momentum in 2024. Speaker 200:08:15Despite subdued volumes across many of our verticals in 'twenty three, our U. S. Sales team did an excellent job winning new business, culminating in strong sales in the 4th quarter for both financial services and our diversified markets. Customer demand remains strong across our verticals and solutions. 2nd, our vertical orientation provides diversification and growth levers that are independent of the lending environment and interest rate moves. Speaker 200:08:43We expect improving growth in our largest U. S. Emerging vertical, insurance, driven by new business wins and customers slowly restoring marketing spend. We have also meaningfully expanded the breadth and depth of our product portfolio. We continue to enhance our value proposition in core credit and to launch new fraud marketing solutions, which combine TransUnion and NuStar strengths. Speaker 200:09:11And Trusted Call Solutions is scaling rapidly with the potential for expansion internationally. 3rd, we expect strong revenue growth from international, which has grown revenues organically by double digits every year since our IPO except for in 2020 due to COVID. India is our largest international market and grew revenues to almost 220,000,000 in 20 up over 30% and contributing roughly 1.5 points to total company growth. We've grown more than 30% in India every year since 2017 with the exception of 2020. We expect all geographies to contribute to growth in 2024. Speaker 200:09:57And finally, This year, we expect to benefit from typical pricing actions, both our own and third parties. We also remain highly focused on increasing profitability by driving savings from our transformation program and acquisition synergies in addition to prudent cost management. Now key to our growth strategy is continuing to integrate NuStar successfully. Over the last 2 years, NuStar has been accretive to our U. S. Speaker 200:10:27Markets growth rate and has scaled its standalone margins significantly. In 2024, we expect NuStar to grow revenue by mid single digits. Our guidance assumes strong subscription revenue growth from our 'twenty three bookings and continued bookings momentum in 2024. But for soft volumes to persist in the more transactional parts of the business, which account for 20% of NuStar's revenue. We expect adjusted EBITDA margin at Newstar to be roughly 32% in 2024. Speaker 200:10:59We are allocating investment dollars to scaling fast across TransUnion. For this reason, we look at margin progress at U. S. Markets as the more relevant statistic. We continue to deliver cost synergies and as of the end of 2023 we achieved our 80,000,000 plus run rate target already above the $70,000,000 referenced at the time of acquisition. Speaker 200:11:32This does not include the benefits of material technology savings from our transformation program, which is enabled and accelerated by NuStar's state of the art data and analytics platform now called OneTrue. We continue to achieve key milestones that can accelerate growth at Neustar and across TransUnion in 2024 and beyond. Now we expect communication solutions to grow on the strength of Trusted Call Solutions or TCS. Since its launch in 2018, TCS has scaled to 80,000,000 in 23, up 30,000,000 or 60% over the prior year. We expect the business to grow over 40% in 2024. Speaker 200:12:20TCS is revolutionizing inbound and outbound voice calling for our customers, improving answering rates, reducing fraud, and increasing efficiency. Demand remains robust and we continue to win new customers across every vertical. Additionally, we're rolling out highly requested enhancements including displaying logos for business calls to consumers, which recently launched with AT and T and blocking spoof calls before they reach consumers. PCS is already a needle mover for U. S. Speaker 200:12:53Markets and total company growth rates and we see a clear right to win in what we believe could be a 1,000,000,000 addressable market in the U. S. Over the longer term. We also see broad application across several geographies and will soon be announcing our next international launch in one of TransUnion's largest markets. In marketing, We integrated 22 additional TEU and NuStar data assets into our new unified identity graph. Speaker 200:13:24Our entire marketing suite is now utilizing this unified graph that incorporates our best data. It enhances the depth, breadth and accuracy of consumer data across offline and online customer channels. With the newly improved adenograph, we cover 98% of the U. S. Adult population with 700 plus demographic attributes and are seeing a 20 plus percent increase in marketable phone numbers and emails and 50 plus percent increase in targetable addresses. Speaker 200:14:00This identity centric approach is resonating with customers, particularly as they contend with the reality of 3rd party during this transition differentiating with our highly authoritative first party identity data as well as direct integration into walled gardens and publishers with privacy enhancing technologies such as clean rooms and partnerships with cloud marketplaces such as Snowflake, Amazon Web Services and the Google Cloud. In Risk Solutions, we expect accelerating growth driven by strong bookings of our contact center products in the second half of twenty twenty three. We're consolidating NuStar's risk capabilities onto TrueValidate to deliver omni channel fraud mitigation and invested incrementally in go to market capacity. Our 3rd strategic focus area for 2024 is executing transformation initiatives. Since I became CEO in 2019, we have invested in global platforms across our product, operations, technology and data and analytics teams to build scale, foster knowledge sharing and develop standardized way of operating across the world. Speaker 200:15:26These initiatives accelerate innovation, streamline workflows, reduce costs and create better user experiences for customers and consumers. In November, we announced the next step of our transformation comprising 2 complementary programs. 1st, we will build upon our strategy of leveraging our global capability centers across the globe, driving workforce productivity and allowing us to provide more services from talent rich geographies like India, South Africa and Costa Rica. We grew our GCCs from 400 employees in 2019 to over 4,000 in 2023 and expect to transition over 1,000 additional roles over the next 2 years. We are balancing the need for customer centric work in market with the opportunity to centralize and standardize key global functions. Speaker 200:16:212nd, we will enhance our technology capabilities by completing our Project RISE cloud migration and leveraging Neustar's technology to consolidate our product and innovation enablement onto a common state of the art platform, 1 True. We expect this transformation to drive material revenue and cost benefits. By 2026, we expect to deliver $120,000,000 to $140,000,000 of annual operating expense savings with half of that realized in 2024. We also expect to reduce our CapEx spend from the historical 8% of revenue to 6% by 2026, the equivalent of $70,000,000 to $80,000,000 in annual cash savings. Now to achieve these savings, we expect to incur $355,000,000 to $375,000,000 of one time costs. Speaker 200:17:15This is inclusive of $65,000,000 already communicated Project RISE. In simple terms, we expect to deliver roughly $200,000,000 of ongoing annual free cash flow benefit for $300,000,000 of incremental one time costs. Just as importantly, these investments, particularly accelerate our innovation rates. One True will enable our growth strategy of extending further into marketing and fraud solutions. These 2 fast growing markets are highly synergistic with our core credit markets. Speaker 200:17:53Put simply, We're not a credit bureau attempting to play in the identity space. We are a consumer identity bureau applying these capabilities to credit data along with marketing and fraud solutions to serve our customers. We believe the complementary nature of credit, marketing and fraud will fuel growth across all three markets. One True will become the destination platform for activating our data assets in a single integrated technology stack across all global TransUnion product families from data ingestion, data management identity resolution to analytics and delivery. The platform is built on top of a foundational hybrid cloud infrastructure developed through Project RISE and leverages NuStar's architecture. Speaker 200:18:44One True is already live and powering TransUnion products And the next 2 years are about enhancing capabilities and consolidating more products, data and analytics onto the platform. We believe that OneTrue will improve our data quality, speed our time to market and accelerate innovation. From a cost perspective, OneTrue will also save costs enabling us to rationalize applications and standardize services. These efficiencies will allow our engineers to spend more time focused on innovation. This standardized operating model will also ensure a compliance and privacy first approach using embedded security guardrails. Speaker 200:19:28The One True platform is increasing our pace of innovation and enabling the next generation of products. Now let me highlight a few examples. In our True IQ analytics suite, we leverage OneTrue to improve the quality of our analytic services by reducing the time to insights and actions. In the past, we've discussed our True IQ Innovation Labs, where our scientists collaborate with customers in multi day hands on sessions infusing our data, analytics and domain expertise to solve their business problems. Last year, we ran a host of these labs on the One True platform. Speaker 200:20:08Clients benefited from real time interaction with our data and analytics for faster model development and deployment. The feedback has been very positive. By integrating our products on this common platform, We'll be able to serve clients' needs across multiple and previously siloed domains and convert our engagement seamlessly into ongoing revenues. We also recently launched True IQ data enrichment, which provides instant access to TEU data from within the customer's technology environment. This privacy first approach to data enrichment eliminates the need for sensitive client IP to leave their control. Speaker 200:20:48The solution streamlines access to credit and marketing data and accelerates model development. Advanced Acquisitions is a new offering that combines data enrichment with our credit and marketing capabilities for an integrated credit based prescreen solution. Advanced Acquisitions powers a full range of consumer acquisition tools including self-service batch prescreens, acquisition campaign model development and deployment and marketing audience definition, build and activation. TransUnion's media planning and measurement tools are also available on the OneTru platform to ensure effective marketing spend. We're also consolidating our fraud mitigation products globally onto 1 True in an integrated suite called TrueValidate. Speaker 200:21:42TruValidate combines our comprehensive identity data along with fraud signals from a range of Neustar and TU products in a single platform where we apply advanced analytics fueled by machine learning and AI to extract deep insights. Our result or rather the result has been a substantial improvement in fraud detection and a reduction in false positives. We're currently beta testing our first release and expect the full rollout this summer. Our fraud product suite serves thousands of customers around the world and represents roughly $300,000,000 of revenues against a multibillion dollar addressable market. We see substantial opportunity to gain share by offering a high performance integrated suite of solutions amplified by best in class analytics, which we believe will outperform the patchwork of point solutions that many customers use today. Speaker 200:22:38And finally, We're creating new and innovative marketing solutions in addition to the ongoing enhancements to our identity capabilities. True Audience Data Collaborations, which we formerly called Clean Rooms is a next generation offering to enable data collaboration between parties that don't want to directly exchange data, but must connect to partners across the advertising ecosystem. It's currently in market in beta testing and will fully launch later this year. Client feedback is enthusiastic and we're working with the walled gardens to drive adoption. I look forward to providing you updates on these product advancements in the coming quarters. Speaker 200:23:18And with that, I'll turn it over to Todd, who'll provide further details on our Q4 financial results, our Q1 and full year 2024 outlook. Todd? Speaker 100:23:29Thanks, Chris, and let me add my welcome to everyone. Speaker 300:23:32As Chris mentioned in the Q4, we exceeded our guidance on all key financial metrics. 4th quarter consolidated revenue increased 6% on a reported basis and 5% on an organic constant currency basis. There was no impact from acquisitions and a less than 1% benefit from foreign currency. Our business grew 4% on an organic constant currency basis, Excluding mortgage from both the Q4 of 20222023, Adjusted EBITDA increased 1% on a reported and constant currency basis. Our adjusted EBITDA margin was 34.2% ahead of our expectations, but down 140 basis points compared to the year ago 4th quarter due to lower services volumes, which have high margin flow through. Speaker 300:24:314th quarter adjusted diluted EPS increased 2%. Adjusted effective tax rate was 21.4% in the quarter and 22% for the full year below our 23% guidance due to successful tax planning efforts. Finally, in the Q4, we took $78,000,000 in one time charges related to the next phase of our transformation. The first expenses and what we expect to be a $355,000,000 to $375,000,000 program, inclusive of the final year of Project Rise. These 4th quarter charges were primarily related to employee separation with a modest amount related to office closures. Speaker 300:25:20I will provide more color on expectations for charges in 2024 during the guidance section. Before I get into U. S. Markets, a reminder that we report NuStar revenue within our vertical market structure. As we've stated previously, starting in 2024, we will stop providing standalone Neustar quarterly revenue growth rates and adjusted EBITDA margins. Speaker 300:25:47We will, however, provide updates to our full year targets to achieve mid single digit revenue growth in 2024. Looking at segment financial performance for the Q4, U. S. Markets revenue was up 3% compared to the year ago quarter. Adjusted EBITDA for U. Speaker 300:26:07S. Markets was flat and adjusted EBITDA margin was down 80 basis points to 33.2%. Financial Services revenue grew 3% with activity broadly consistent with the levels seen late in Q3. Consumer lending revenue declined 3%. Online activity remains soft, but batch marketing has seen some modest improvement among our FinTech customers, a sign that players are cautiously anticipating growth. Speaker 300:26:42Our credit card and banking business was down 5%. While issuance is healthy on a historical basis, Online and batch activity remains tempered as lenders contend with credit normalization, deposit pressures and potential capital constraints. We are seeing stronger activity from our largest customers compared to a more conservative approach by mid market and smaller institutions. We continue to retain and win share across our customers with momentum in fraud and identity solutions. Our auto business grew delivered 1% growth on top of 16% growth in the prior year quarter. Speaker 300:27:26New car sales in the U. S. Totaled $15,500,000 in 2023, up 12%, but still below the roughly $17,000,000 of annual sales seen from 2015 to 2019. Sales are expected to increase modestly in 2024. The higher level of new car sales will still take time to replenish The used car market, which saw declining sales in 2023 and continues to face availability and affordability challenges. Speaker 300:28:01Used car prices were down in 2023, but are still 30% above pre pandemic levels. The used car market currently accounts for almost 60% of finance vehicles in the U. S. For mortgage, revenue was up 34% in the quarter against inquiry volume declines of 11%. The pace of volume decline slowed throughout the year, but for the year applications were over 50% below 2019 levels and existing home sales were the weakest since 1995. Speaker 300:28:40Average mortgage rates after topping 8% in late October have fallen to 6.5% to 7% range. Rates remain high in a recent historical basis, which combined with elevated home prices and low inventory will likely limit activity. On a trailing 12 month basis, mortgage represented about 7% of total TransUnion revenue. Let me now turn to our emerging verticals, which grew 2% in the quarter. Churns delivered mid single digit growth in the 4th quarter and 4% for full year 2023 with trends stable and in line with expectations in the 4th quarter. Speaker 300:29:25In 2024, we expect to deliver improving growth with momentum as the year progresses. After 2 years of contracting marketing activity, we expect carriers to slowly restore marketing spend as rate adequacy improves And while consumer shopping activity remains robust, we continue to deliver significant new business wins across our core products as well As with innovative products like TruVizion driving history and successful cross selling of Neustar and Sontiq solutions. Tech, Retail and E Commerce and Telco both grew low single digits. Tech, Retail and E Commerce benefited from Trusted Call Solutions wins and good fraud and identity volumes from e commerce customers, while caller ID drove growth in telco. Media was flat as usage based volumes for our audience solutions remain soft. Speaker 300:30:31Across our other emerging verticals, services and collections and public sector both grew double powered by strong growth in trusted call solutions. And unemployment screening declined As we work through the recalibration of our solutions, we are working to provide the most customer and consumer friendly approach possible And we believe it will create a long term competitive advantage, particularly as regulators push for more consistent and compliant data usage across vendors. Consumer Interactive revenue increased 7%, benefiting from a large Breach win. We continue to grow our Breach business largely on the strength of the SonTic offerings. Reach revenues can be uneven, but are increasingly the byproduct of proactively selling recurring cyber protection programs to companies through cyber insurance providers. Speaker 300:31:31Breach response engagements also provide new engagements with consumers with opportunities to cross sell them into credit education and identity protection programs. Excluding the large breach win, Revenue would have declined 2% in line with our expectations and the current run rate of the business. Adjusted EBITDA margins were 45.5 percent down 580 basis points due primarily to the impact of the Breach win. Our direct business continues to decline as we recalibrated our marketing approach to focus on higher value consumers. So far, we've seen good returns on the revamped approach. Speaker 300:32:20We continue to work to improve our value proposition and go to market strategy in this business. Our indirect business grew led by SanTec, which grew double digits in the 4th quarter and over 20% for the full year. In addition to stronger than expected breach revenue, Sontiq's identity protection business grew double digits. For our traditional credit education products, performance across customers varied based on the idiosyncratic market dynamics. Lenders continue to be selective in utilizing offer aggregators in other channels for marketing. Speaker 300:33:03For my comments about international, all revenue growth comparisons will be in constant currency. For the total segment, revenue grew 13 percent with 4 of our 6 reported markets growing by double digits. Adjusted EBITDA margin was 44%, up 20 basis points. Now let's dig into the specifics for each region. In India, we grew 30%, reflecting strong market trends and generally healthy consumers. Speaker 300:33:31We continue to win share in core consumer credit with an expanding suite of credit oriented solutions as well as increased penetration of small and medium lenders. This strong core performance is complemented by meaningful growth across commercial, credit, fraud, marketing and direct to consumer offerings. We now generate over a third of our India revenue outside of consumer credit, a testament to the success of taking our growth playbook to the Indian market. We expect another very strong year from India in 2024. In the U. Speaker 300:34:10K, revenue was flat. The U. K. FinTech market remains challenged, but we continue to see good growth in banking and insurance as well as share gains and wins with products like TruVizion, Trended Data and our consumer offerings. Our Canadian business grew 14% despite a tepid macro environment substantially outperforming flat slightly declining lending market growth. Speaker 300:34:39We benefited from share gains in financial services, strong growth in telco and insurance and continued momentum in direct to consumer, including recent breach wins. Material portion of the outsized Growth in Canada in 2023 came from sizable share wins, which will be fully annualized in 2024. For 2024, we expect healthy mid single digit growth and continued market outperformance. In Latin America, revenue was up 5%. Brazil was down in the quarter due to weakness in the FinTech market. Speaker 300:35:19In Colombia and our other Latin American countries, We delivered good growth across online and batch despite softening market conditions with wins across financial services, government and insurance. In Asia Pacific, we grew 13% led by very strong growth in the Philippines where we see attractive market growth and increased customer penetration. Hong Kong also had another solid quarter. Finally, Africa increased 11% based on a broadly strong performance despite a challenging environment in several of our largest markets. Turning to the balance sheet. Speaker 300:36:02We ended the quarter with roughly $5,300,000,000 of debt after prepaying $25,000,000 in the quarter for a total of $250,000,000 in 2023. Looking back, since we announced the acquisition of NuStar in September of 2021, we've prepaid about $1,500,000,000 of debt. That left us with $480,000,000 of cash on the balance sheet. We finished the quarter with a leverage ratio of 3.6x. In October, we completed the refinancing of our revolving credit facility and Term Loan A. Speaker 300:36:44In addition to extending our maturities from 2024 to 2028, We expanded our revolver from $300,000,000 to $600,000,000 and our term loan A from $1,000,000,000 to $1,300,000,000 We used the incremental $300,000,000 raised for our Term Loan A to prepay $300,000,000 of our higher coupon term loan B6. Last week, we repriced our term loan B6 reducing our credit spread by 25 basis points and removing the credit spread adjustment. The combined impact of these 2 refinancings results in roughly $8,000,000 of annual interest expense savings. Net of our swaps, our average effective cost of debt at today's sulfur rate is roughly 5%. You can find our updated debt profile in the appendix of our presentation. Speaker 300:37:50We continue to focus on the integration of our recent acquisitions and have no intention to make large scale acquisitions this year. Our priority is to prepay debt in 2024 with our excess cash flow. However, We expect prepayments to be lower than 2023 due to the one time cash payments related to our transformation program. Cash outlays related to our 4th quarter cost actions were minimal and we expect most of our $355,000,000 $375,000,000 of one time expenses to be paid out in 2024. Based on our expectations for adjusted EBITDA and cash generation, we expect our leverage ratio to be in the low three time range by the end of 2024. Speaker 300:38:42We continue to work toward our leverage ratio target of under 3 times. We do not view 3 times as an ending point for deleveraging and view debt prepayments as the best incremental use of our cash over the medium term. Turning to guidance, I wanted to first explain our philosophy for 2024. When we provided Q4 2023 guidance in October, we were deliberately very conservative following a challenging third quarter. Our guidance for the Q1 and full year 2024 reflects more typical TransUnion conservatism. Speaker 300:39:23We are assuming the current slower conditions persist throughout the year. Should interest rate cuts occur and drive increased lending and marketing activity that would represent upside to our current guidance. That brings us to our outlook for the Q1 of 2024. We expect FX to have an insignificant impact on revenue and adjusted EBITDA. We expect revenue to come in between $971,000,000 $980,000,000 or up 3% to 4% on an as reported and organic constant currency basis. Speaker 300:40:03Our revenue guidance includes 1 point of tailwind from mortgage, meaning that we expect the remainder of our business will be up 2% to 3% on an organic constant currency basis. We expect adjusted EBITDA to be between $324,000,000 and $331,000,000 up 1% to 3%. We expect adjusted EBITDA margin of 33.4% to 33.8% or down 50 to 90 basis points. Margins are expected to be down sequentially and year over year due to the timing of expenses in international, particularly India, as well as consumer interactive. We expect year over year margin expansion in our U. Speaker 300:40:51S. Markets business in the Q1. We expect the Q1 to be our lowest margin quarter with margins expanding each quarter as transformation savings build throughout the year. We also expect our adjusted diluted EPS to be between 0.79 $0.81 a range of down 2% to up 1%. Turning to the full year, we expect insignificant impact from FX on revenue and adjusted EBITDA. Speaker 300:41:25We expect revenue to come in between $3,960,000,000 $4,020,000,000 or up 3% to 5% on an as reported and organic constant currency basis and up about 1.5% to 3.5% excluding the impact of mortgage. For 2024, we expect mortgage inquiries to be down roughly 5% and our revenues to increase roughly 25%, primarily due to the impact of 3rd party Scores pricing. We expect inquiries to be down roughly 15% in the first half of the year and up roughly 10% in the second half of the year as comparisons ease. For our business segments, we expect U. S. Speaker 300:42:15Markets to grow mid single digit or low single digit excluding mortgage. We anticipate financial services to be up mid single digits or up low single digits excluding mortgage. We expect emerging verticals to be up low single digits. We anticipate that international will grow high single digits in constant currency terms driven by the same positive trends that we saw throughout 2023. And we expect Consumer Interactive to decline low single digits. Speaker 300:42:49Turning back to total company outlook, We expect adjusted EBITDA to be between $1,398,000,000 $1,441,000,000 up 4% to 7%. That would result in adjusted EBITDA margin being 35.3% to 35.8% or up 25 basis points to 75 basis points. We anticipate adjusted diluted EPS to be 3 point $3.74 up 6% to 11%. We expect our adjusted tax rate to be approximately 22.5%. Depreciation and amortization is expected to be approximately $530,000,000 and we expect the portion excluding step up amortization from our 2012 change in control and subsequent acquisitions to be about $245,000,000 We anticipate net interest expense will be about $245,000,000 for the full year, down over $20,000,000 year over year, primarily due to our 2023 debt prepayments, recent refinancings and lower sulfur. Speaker 300:44:06We expect to take an incremental roughly $200,000,000 in one time charges in 2024 related to our transformation program. Combined with $78,000,000 charges in the Q4, we expect a total of roughly $280,000,000 spent through 2024 compared to 3 $55,000,000 to $375,000,000 of total program costs, which are expected to be completed in 2025. We expect capital expenditures to be about 9% of revenue. I want to wrap up with some additional detail about our expectations for adjusted EBITDA in 2024. A key driver of adjusted EBITDA growth is flow through from higher revenue, inclusive of continued investment in the business. Speaker 300:44:57Based on the high end of our guidance, we expect to grow revenues by roughly $190,000,000 and adjusted EBITDA by $65,000,000 While we are adding absolute adjusted EBITDA dollars, The lower than typical incremental margin is due to mix of revenue growth outside of core credit as well as targeted investments primarily to support the strong growth in our international segment. When lending activity picks up, we expect to see strong incremental margins. 2nd positive is savings from our transformation program, which we expect to deliver roughly $65,000,000 in benefit, In line with our commitment in November, we expect the savings benefit to build throughout the year. We also expect $20,000,000 to $25,000,000 of benefit from continued NuStar acquisition synergies as well as reduced Santic and Argus integration costs in 2024. Partially offsetting these positives is resetting our annual incentive compensation costs to target after a below target payout in 2023 in addition to annual merit increases. Speaker 300:46:16Taken together, we expect a good year for adjusted EBITDA growth with expected additional transformation savings still to come and further upside if we see any step up in credit volumes. I'll now turn the call back to Chris for some final comments. Speaker 200:46:33Thank you, Todd. To wrap up, we exceeded 4th quarter expectations driven by stable lending and marketing conditions in the U. S. And robust growth from international. We expect a strong year in 'twenty four with mid single digit revenue growth and high single digit adjusted diluted EPS growth. Speaker 200:46:52We're focused on 3 strategic priorities for the year to create value for TEU, accelerating revenue and earnings growth, leveraging NuStar's product and technology capabilities further and executing on our transformation initiatives. Finally, on a personal note, as many of you know, Aaron Hoffman has decided to retire from TransUnion in March. Aaron has been instrumental in building out the Investor Relations function at TU and has been a valuable resource to our management team and to investors alike. We've been lucky to have him over these last 8 years and we wish him a happy retirement. We're also excited to have Greg Barty who has been working with Aaron these last 3 years and covered TransUnion on the sell side before that, leading our Investor Relations going forward. Speaker 200:47:41Now let me turn the time over to Aaron. Speaker 100:47:43Thanks, Chris, and thanks for those kind words. I appreciate that very much. So that does conclude the prepared remarks today. And for the Q and A, as always, we ask that you ask only one question so that we can include more participants. And operator, we can begin the Q and A now. Operator00:48:01Thank you. And today's first question comes from Jeff Meuler with Baird. Speaker 400:48:28This is Steven Pollack on for Jeff. I guess, what Do you need to see or what are your clients that they need to see in order for NuStar transactional revenue to improve or bounce back? Speaker 500:48:43Yes. Good morning, Jeff. I think I'll start answering that. Oh, it's Steven. Yes. Speaker 500:48:51On the NuStar front, the headwind to hitting our growth targets there beyond mid single digits has been The decline in the transactional components of the portfolio. In a more difficult economic environment, Marketing and advertising activity has pulled back. In addition to the volume slowdown, we've seen clients working to reduce data costs, right, and relying more on first party data. So both of those have been headwinds to our sales. We've compensated a bit for the cutback on the data side by selling more first party record hygiene and identity resolution services. Speaker 500:49:34So really what we need is, I think, a stable floor in those areas and perhaps some rebound in activity. The guidance that we provided at NuStar is consistent With our overall guidance this period, it's intended to be conservative, yet constructive. We're pushing to exceed that guidance and we hope we'll be able to over the course of the year. Operator00:50:07Thank you. And our next question today comes from Andrew Steinerman with JPMorgan. Please go ahead. Speaker 600:50:13Hi, Chris. Could you jump into the consumer interactive guide for 2024? Just maybe Expand on what your expectations are more than just the numbers? And then inside the numbers, what are you assuming in terms of indirect growth Consumer Interactive and when do you expect direct to return to growth? Speaker 500:50:35Yes. So obviously, Andrew, we have been navigating a pivot in the consumer business over the past 18 months or so. Part of that is the direct business, which has been in decline, in part because of market demand shifting more toward freemium, but also some adjustments in our marketing practices. That area has been the most pronounced decliner. Where we're at now is we can see it getting to kind of a neutral state over the course the year, sometime probably mid second quarter, a combination of reaching an equilibrium on our marketing practices and enjoying the benefits of the annual price and the like. Speaker 500:51:23We expect indirect to remain kind of a low single digit grower over the course of the year. And of course, breach protection and identity protection through our NuStar acquisition I'm sorry, the Versysic acquisition is doing particularly well. It grew over 20% last year, had a really strong Q4. Again, think of the consumer guide in total in the context of an overall conservative corporate guide, right, where we're steering more toward the high end of things. And look, I think it's important just to emphasize in the big with regard to TU in the consumer space is that we believe we will return this business back to consistent positive organic growth, and we intend to compete across the full dimension of opportunities, whether that be, identity protection, premium offerings, and the like. Operator00:52:32Thank you. And our next question today comes from Fema Auli with Deutsche Bank. Please go ahead. Speaker 700:52:39Yes. Hi, good morning. Thank you. I wanted to ask about U. S. Speaker 700:52:44Financial Services And the growth that you are assuming there for 2024, just give us some color around how We should think about auto card, consumer lending and we didn't touch on Argus, so curious What your expectations are there? Thanks. Speaker 500:53:05Sure. So in U. S. Financial Services, I mean, look, as we know, There was a year of turmoil in 2023. Not only were we dealing with the impact of inflation and much higher interest rates, which slowed demand, but we're also dealing with Deposit outflows from certain segments in banking because of the instability that we experienced in the second quarter, That led to a material slowdown in September of last year. Speaker 500:53:37We modeled a continuation of that slowdown in the 4th quarter, in fact, deterioration from that rate, it turned out that that was a bit conservative and we over performed that as you can see. Turning to 24, we think we're at or near a floor in most of these services, But we're not assuming any improvement, right? So we've kind of budgeted for steady volume across the different subcategories of financial services in the U. S. Over the course of the year. Speaker 500:54:14Now growth rates are going to improve in the second half because comparables are easier in the second half, and of course, by the second half, we're getting the full benefit of price actions of both our own and third parties. But it's kind of a steady sailing forecast, if you will. We're not building in any uplift from the potential for interest rate reductions by the Fed. Operator00:54:44Thank you. And our next question today comes from Toni Kaplan with Morgan Stanley. Please go ahead. Speaker 800:54:50Terrific. Thank you. I was hoping you could talk about your expectations for the FinTech environment through 'twenty four. I know you talked about some modest improvement in batch that you're seeing, but still challenges in the UK. So just hoping to get a little more color on where you see FinTech in particular go from here. Speaker 800:55:10Thanks. Speaker 500:55:12Yeah. Well, last year was an especially difficult one for FinTech, largely because of the increase in borrowing costs and the difficulty of getting funding. But I think also some concerns about the health of the consumer from the Q3 forward. We saw a pretty material reduction here in the U. S. Speaker 500:55:34That segment probably fell roughly 20% last year. Again, our assumptions for 2024 are more or less steady from the volumes that we experienced in the 4th quarter. We're encouraged by the stability that we're seeing and we're encouraged by the uptick in some batch activity, which suggests that there will be more marketing activity in the space, but we haven't modeled too much of that optimism into the guide. Speaker 400:56:07And just to add on to that, Tony, just to provide some sizing for FinTech. We talked about in 2022 that we did about 100 and $75,000,000 last year in the U. S. We're talking about. And We brought it last year, we saw it come down to $140,000,000 So that's the 20% that Chris is referring to. Speaker 400:56:34The reason for bringing that out is TransUnion has a very nice position with FinTechs that we've spoken about and our team has done Speaker 500:56:42a great Speaker 400:56:42job building those relationships. And in the whole scheme of our revenue, it's less than 4 percent of the overall company's revenue. So just wanted to make certain that was appropriately sized in response to your question. We see tremendous opportunity though for us as we believe that those customers are on a path to growing again and we're best positioned to take advantage of that. Speaker 500:57:07And you also mentioned the UK. I mean, clearly, it was even more difficult here. You had a number of players that exited the market. That impacted our overall. As I said, in the UK, we're continuing high single digit growth. Operator00:57:28Thank you. And our next question today comes from Kelsey Xu with Autonomous Company. Please go ahead. Speaker 900:57:35Hi, good morning. Thanks for taking my question. 1 of your peers has highlighted headwinds to their mortgage pre revenues in 2024 because soft pull ups are getting really I was wondering if you're expecting similar happens in that space in 2024 and how big prequalification revenues would be for mortgage for TransUnion? Speaker 500:58:03Hey, Kelsey. I think I followed the question. We had a little bit of a technical glitch here, but I think you're talking about mortgage headwinds due to a rollout of the single bureau prequalification that the FHFA has sponsored. We have modeled that into our assumptions. So it is baked into the guide that we have provided. Speaker 500:58:31We expect that it will cause some volume deterioration. But again, that's factored into well, that's just one factor in our process of estimating where we think mortgage volumes will be. So we look at all of the publicly available information. We talk to our client advisory board. We've got the recent historical trajectory of this. Speaker 500:58:57And then we have made some adjustments for an industry wide adoption of a single euro pool at prequalification. Operator00:59:08Thank you. Our next question comes from Ashish Sabadra with RBC Capital Markets. Speaker 1000:59:17Just wanted to focus down or drill down further on the emerging verticals. You mentioned the win in insurance and pretty good momentum there, but how should about the puts and takes? And for the rest of the emerging verticals, can you talk about some puts and takes in 2024? Thanks. Speaker 400:59:36Sure. Yes, Ashish, I'll take that one from you. So the I think the heart of your question really comes down guidance that we provided for the emerging verticals and that we're assuming to be low single It's really the way to think about that. The way we look at it, as we break the emerging vertical different segments. And you alluded to already insurance. Speaker 401:00:03We're expecting insurance to have a healthy year in 2024. The team has signed many new clients, so there's significant new business wins that will come to fruition As we spoke about in our prepared remarks, marketing is improving slowly, but we're so cautiously optimistic about that and shopping activity remains strong. So all in all, insurance we're expecting a good year probably in the mid digits of growth. Also in the emerging verticals, we're expecting good growth in services and collections as well as in our public sector verticals. And a lot of that growth is coming from trusted call solutions where we've seen significant meaningful growth and obviously that's the capability that came with the Star acquisition. Speaker 401:00:57So those 3 verticals of insurance services and collections and public sector represent about 40% of the revenue. So that means the other 60% we talked about, expected growth out of those 3. So And then other 60%, the areas our tenant and employment Here, as you're well aware, to recalibrate Due to a consent order that signed with the CFPB, updated our products to provide a these reports that we provide in space. But I think it's a little bit of time that probably more maybe in the second half of the year Get back to the growth expectations. 2nd thing that is The communication verticals where much of new start see capabilities with them. Speaker 401:02:18So think of ColorEdge TransUnion now provides to the health department. That's kind of a flattish business and it's also a bigger. So needless to say that Speaker 501:02:33to the growth rate. And also Speaker 401:02:37the media vertical It also has tempered expectations for us in 2024. What Chris spoke about earlier, we'll be on this generation. It's very volume dependent. So if there's a recovery coming on the marketing side, And that would be something that we would undertake. By highlighting those 3, because those are the 3 where our expectations are a little bit And consistent with the guidance that we've provided for the year, this is just where we're being Speaker 501:03:35A couple of color points on emerging. Employment where we signed this consent order saw revenue turn negative as we had continue certain products. CFPB subsequently has issued guidance to the industry That conforms very tightly to the consent order that we signed, And we're seeing other industry players adopt similar adjustments and curtailments to the type of information that they're providing. And we think it's a good news. We think CPD levels the plane. Speaker 501:04:15Once we lap changes we're going to return to growth. One thing I would mention, the communications part of the wallet is like growth overall, Those services that we provide, while they mature, they're extremely profitable and most importantly, feedstock Operator01:04:46Thank you. And our next question today comes from Manav Patnaik with Barclays. Please go ahead. Speaker 601:04:53Yes, thank you. I just had Speaker 1101:04:55a question on mortgage plus pricing, I guess. The down 15% in the first half, that just seems like kind of continuation what you saw in the Q4. Just wanted to confirm the plus 10% in the second half. Was that purely comps? Or is there some other assumption you've made in there? Speaker 1101:05:11And then I think in your prepared remarks, you said pricing going up from your own and third party. I think we know the 3rd party, but just wanted some more clarity on where your open pricing is going up and how much? Speaker 401:05:29Manav, this is Todd. Can you hear me okay? I can Speaker 1101:05:33hear you now. It's a little muffled while you're Speaker 401:05:39Okay, great. So I'm going to I'll speak louder. So as far as the assumptions that we have pertaining to our volumes, we are assuming that we're going to grow We're going to be down 10% in the first half, but up 15% in the second half, I'm just reiterating and then down 5% for the full year. The assumption is just purely on the comparisons in the second half of the year. There's no we're not banking on any type of recovery in mortgage. Speaker 401:06:15It's more kind of the same, right? And just to provide a little bit more context on that, when we build our assumptions for mortgage, we're looking at this across Multi dimensions. The first being our own team, and what they're seeing in the market. The second, being a mortgage advisory board. This is where we're hearing directly from our customers as it pertains to what their And then the third area is where we look at outside data sources like you do. Speaker 401:06:51So for example, the Mortgage Bankers Association. So Speaker 501:06:55you take those three elements Speaker 401:06:57and that's how we come up with our guide. The second part was Speaker 501:07:05about the pricing. I'll wait here because I didn't hear it. Mean, obviously, Manav, as you well know, 3rd party pricing is the biggest driver of price increases in mortgage and has been for the last couple of years. Our comment about our own pricing, you should think of it as more or less consistent with our annual pricing practices. And then again, again, as we all know, if the Fed were to lower rates, mortgage volumes is probably the first area where we would see some uptick. Operator01:07:39Thank you. And our next question today comes from Owen Lau with Oppenheimer. Please go ahead. Speaker 1201:07:45Hey, good morning. Thank you for taking my question. Can you please go back to your weighted assumption? Are you assuming no rate cut currently? I mean, if there are 3 rate cuts that's the Fed is projecting right now or even more than 3 just like what the market is pricing in, how should we think about the incremental benefit in revenue and also EPS in 2024? Speaker 1201:08:07Thank you. Speaker 401:08:09Yes. Owen, as it pertains to our interest rate assumption, we are not assuming that the business gets any benefit from interest rate cuts. So think of that as if the interest rates come and there is an uptick in lending that would all be upside to the guidance that we provided this morning. Speaker 501:08:36Yes. Look, this is an opportunity, I think, for us to just provide some context and clarification on the nature of the guidance. It's 3% to 5% organic. Clearly, Todd and I feel the odds are more towards the high end of that range. And again, we wanted to be Given the environment in which we're operating, we're not Modeling in volume increases due to rate cuts that would all be upside and we're steering the business toward what we hope will be outperformance. Operator01:09:13Thank you. And our next question today comes from Andrew Nicholas with William Blair. Please go ahead. Speaker 1301:09:19Hi, good morning. Thank you for taking my question. I just wanted to ask on NuStar margins specifically, I think You guided to 32% this year historically or I guess previously you talked about a 40% margin target. Just wondering kind of if that's still within the realm of expectations over the medium term, what will it take to get up to that level, recognizing that you've already gotten the $80,000,000 plus of cost savings in the run rate, just an update there would be helpful. Thank you. Speaker 501:09:55Yes, for sure. So the guide to NuStar margins getting to the level of the full enterprise, at least peak margin performance was more in the context of a 4 to 5 year period, right? We've had 2 years of ownership. We've added 1,000 basis points. We're headed toward 32% this year. Speaker 501:10:15And while we've achieved the $80,000,000 in cost reductions, Look, we think there's more juice in the squeeze, so to speak. We're not formalizing it. We're not guiding to it. The other factor that's going to give us material margin upside is as the revenue growth rate increases in NuStar, Assuming we start to enjoy flattish market conditions on the marketing side and get some uplift On the risk side, through all of the innovation that we've done with our fraud mitigation suite, we're going to get higher flow through that's going to help drive margins up to that initial post acquisition guide. Speaker 401:11:00Great. And that brings us to the end of the call today as we're bumping up towards the top of the hour and a very busy day of earnings for everyone. I want to thank you for your time today and wish everybody a good rest of the day. Thank you very much. Operator01:11:14Thank you. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day.Read morePowered by