2016 ANNUAL REPORT - TransUnion

2016 ANNUAL REPORT

Dear Shareholders,

areholders, Customers, Partners an

and Associates:

I am pleased to report

port that TransUnion delivered very good results in a year highlighted by strong financial per

performance,

outstanding execution and meaningful strategic actions. Revenue, adjusted EBITDA and adjusted earnings per share grew doubledigits as a result off strong growth from each of our three business segments¡ªUSIS, International and Consumer

Consum Interactive.

We continue to execute on our strategy and deploy cash for internal investments that drive operational efficienc

efficiencies and long-term

organic growth,

h, as well as acquisitions, such as the Colombian credit bureau CIFIN, and Auditz and RTech in our Healthcare

H

vertical.

As our leverage

rage ratio has now dropped below our target of 3.5x net debt to adjusted EBITDA and we have real conv

conviction in our

long-term

m growth plans, we¡¯re in the enviable position to continue to invest in our business and begin to return capital

capit to our

shareholders.

lders. To that end, we announced a 3-year share repurchase program to buy back up to $300 million of TransUnion

Trans

stock.

These

se impressive results are a reflection of the transformation we¡¯ve made into a leading information services company. Thi

This

transformation is evident in our significantly more diversified portfolio compared to just five years ago when we started this journey.

As we look

ok ahead, we¡¯re focused on five core growth themes designed to maximize the growth potential of our very uniqu

unique and

powerful business

bu

model.

The first is to

o drive growth

h tthrough innovation. In recent

ent years, we¡¯ve placed a heightened emphasis on delivering industryleading innovation

ation and have successfully done so across our portfolio. Our trended data product, CreditVision?, has enabled

a fundamental change in lenders¡¯ ability to score and understand credit behavior in the U.S., Canada and Hong Kong.

CreditVision willl be rolled out in India, Colombia and South Africa in 2017.

We have also seen

n successful innovation in Insura

Insurance with our DriverRiskSM product, in Rental Screening with SmartMove 2.0?

helped drive our

and in Collections

s with TLOxp?. Each of these products adds significant value for our customers and has he

impressive growth.

th

Our innovation

n capability has been meaningfully improved with the completion of our next-generation technology

technolo platform,

which enhances

ces our ability to quickly and efficiently work with the full breadth of our data assets to provide uniqu

unique and powerful

customer solutions.

ol

The second

nd theme is to expand

nd in our vertical markets, which

hich include Healthcare, Insurance, Collections, Rental Scr

Screening

and Government.

vernment. Growth is coming from delivering innovation in each vertical and we continue to enhance our capabilities

capab

through

ough acquisitions like Auditz and RTech in Healthcare, Drivers History Information in Insurance and TLO as a means of

acquiring valuable public records data. Taken together, these growth verticals provide attractive diversification and are delivering

consistent

sistent double-digit, top line growth that we expect to continue in the future.

The third ttheme is to drive growth

owth across our diversified international

internatio

footprint. Like our growth

wth verticals, the International

Inter

segment has been producing double-digit, constant currency, top line growth with an attractive sales mix of two-thirds

two-th

emerging

market and one-third developed

develo

markets.

In addition to the compelling underlying market trends, we continue to layer innovation and our growth verticals

vertical into these

markets. For instance,

stance, the launch of CreditVision in Canada helped drive 20% constant currency revenue growth

gro

in 2016.

Similarly, we¡¯re seeing

eeing incremental growth from the introduction of insurance products and direct-to-consumer

direct-to-consu

offerings

in many of our international

erna

markets.

The fourth theme is to deliver growth in Consumer

er Interactive and empower

empowe consumers. Through strategic

rategic partnerships, we

continue to expand

and our position in the direct-to-consumer market. In 2016, to reach the largely untapped cre

credit union market,

we both enhanced

ced our commercial agreement with and made an investment in SavvyMoney. And, to expand our

ou capabilities, we

made an investment

stment in password and ID protection company Dashlane. We continue to expand our presence in the financial

services market

rket with the addition of one of the largest banks, which is offering all consumers free access to their TransUnion

credit report

ort and score. We¡¯re also leveraging best practices from the U.S. to expand our consumer business globa

globally. With

each move,

ve, we position the Consumer Interactive business for the long term, while also helping empower consumers.

consumer

And, finally, our fifth theme is to leverage global operating excelle

excellence. Our global, next-generation

eneration technology transformation

transform

was a foundational move to drive innovation and efficiency across the company. Additionally, we¡¯re building global sales and

marketing

rketing capabilities to fully levera

leverage our scale.

Taking alll these strategies together, I am more confident in the future

futu of TransUnion

than ever before. We have the right people executing against aggres

aggressive and focused

strategies to fully leverage our powerful business model.

I want to conclude

clude by thanking our shareholders for their ongoing support and our

employees for the

he amazing work they do every day to make TransUnion a great

gre company.

Sincerely,

y

JIM PECK

CK

President

ent and Chief Executive O

Officer

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

? ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF

1934

For the fiscal year ended December 31, 2016

- OR -

¡®

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934

For the transition period

from to

Commission file number 001-37470

TransUnion

(Exact name of registrant as specified in its charter)

Delaware

61-1678417

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

555 West Adams, Chicago, Illinois

60661

(Address of principal executive offices)

(Zip Code)

312-985-2000

(Registrant¡¯s telephone number, including area code)

Securities Registered Pursuant to Section 12(b) of the Act:

Title of Each Class

Name of Each Exchange on Which Registered

Common Stock, par value $0.01 per share

New York Stock Exchange

Securities Registered Pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

? YES ¡® NO

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

¡® YES ? NO

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange

Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has

been subject to such filing requirements for the past 90 days. ? YES ¡® NO

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive

Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (¡ì 232-405 of this chapter) during the preceding 12

months (or for such shorter period that the registrant was required to submit and post such files). ? YES ¡® NO

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (¡ì 229.405 of this chapter) is not contained

herein, and will not be contained, to the best of registrant¡¯s knowledge, in definitive proxy or information statements incorporated by

reference in Part III of this Form 10-K or any amendment to this Form 10-K. ?

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting

company. See the definitions of ¡°large accelerated filer¡±, ¡°accelerated filer¡± and ¡°smaller reporting company¡± in Rule 12b-2 of the

Exchange Act.

? Large accelerated filer

¡® Accelerated filer

¡® Non-accelerated filer

¡® Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

¡® YES ? NO

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was approximately $2.4

billion as of June 30, 2016 (based on the closing stock price of such stock as quoted on the New York Stock Exchange).

As of January 31, 2017, there were 183.3 million shares of TransUnion common stock outstanding, par value $0.01 per share.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement of TransUnion for the Annual Meeting of Stockholders to be held May 3, 2017 are incorporated by

reference to the extent specified in Part III of this Form 10-K.

TRANSUNION

ANNUAL REPORT ON FORM 10-K

YEAR ENDED DECEMBER 31, 2016

TABLE OF CONTENTS

PART I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 1. BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 1A. RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 1B. UNRESOLVED STAFF COMMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 2. PROPERTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 3. LEGAL PROCEEDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 4. MINE SAFETY DISCLOSURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

PART II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 5. MARKET FOR THE REGISTRANT¡¯S COMMON EQUITY, RELATED STOCKHOLDER

MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 6. SELECTED FINANCIAL DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 7. MANAGEMENT¡¯S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK . . . . . . . .

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Comprehensive Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Stockholders¡¯ Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND

FINANCIAL DISCLOSURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 9A. CONTROLS AND PROCEDURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 9B. OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

PART III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE . . . . . . . . . . . . .

ITEM 11. EXECUTIVE COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

AND RELATED STOCKHOLDER MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR

INDEPENDENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

PART IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ITEM 16. FORM 10-K SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

1

23

40

40

40

43

46

46

48

51

74

76

80

81

82

83

85

88

120

120

123

124

124

124

124

124

124

125

125

126

Cautionary Notice Regarding Forward-Looking Statements

This Annual Report on Form 10-K, including the exhibits hereto, contains ¡°forward-looking statements¡± within

the meaning of federal securities laws. Any statements made in this report that are not statements of historical

fact, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking

statements include information concerning possible or assumed future results of operations, including

descriptions of our business plans and strategies. These statements often include words such as ¡°anticipate,¡±

¡°expect,¡± ¡°suggest,¡± ¡°plan,¡± ¡°believe,¡± ¡°intend,¡± ¡°estimate,¡± ¡°target,¡± ¡°project,¡± ¡°should,¡± ¡°could,¡± ¡°would,¡±

¡°may,¡± ¡°will,¡± ¡°forecast¡± and other similar expressions.

Although we believe that these forward-looking statements are based on reasonable assumptions, you should be

aware that factors affecting our actual financial results could cause actual results to differ materially from those

expressed in the forward-looking statements. Factors that could materially affect our financial results or such

forward-looking statements include, among others, the risks, uncertainties and factors set forth below under

¡°Risk Factors,¡± and the following factors:

?

macroeconomic and industry trends and adverse developments in the debt, consumer credit and

financial services markets;

?

our ability to provide competitive services and prices;

?

our ability to retain or renew existing agreements with large or long-term customers;

?

our ability to maintain the security and integrity of our data;

?

our ability to deliver services timely without interruption;

?

our ability to maintain our access to data sources;

?

government regulation and changes in the regulatory environment;

?

litigation or regulatory proceedings;

?

regulatory oversight of certain ¡°critical activities¡±;

?

our ability to effectively manage our costs;

?

economic and political stability in the United Sates and international markets where we operate;

?

our ability to effectively develop and maintain strategic alliances and joint ventures;

?

our ability to timely develop new services and the market¡¯s willingness to adopt our new services;

?

our ability to manage and expand our operations and keep up with rapidly changing technologies;

?

our ability to make acquisitions and integrate the operations of acquired businesses;

?

our ability to protect and enforce our intellectual property, trade secrets and other forms of unpatented

intellectual property;

?

our ability to defend our intellectual property from infringement claims by third parties;

?

the ability of our outside service providers and key vendors to fulfill their obligations to us;

?

further consolidation in our end-customer markets;

?

the increased availability of free or inexpensive consumer information;

?

losses against which we do not insure;

?

our ability to make timely payments of principal and interest on our indebtedness;

?

our ability to satisfy covenants in the agreements governing our indebtedness;

?

our ability to maintain our liquidity;

?

share repurchase plans;

?

our reliance on key management personnel; and

?

our controlling stockholders.

 ................
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