易速傳真 (EFX) 2016 Q3 法說會逐字稿

Good day, and welcome to the third-quarter 2016 earnings call.

Today's conference is being recorded.

At the time, I would like to turn the conference over to Mr. Jeff Dodge.

Please go ahead, sir.

Thanks, and good morning.

Welcome to today's conference call.

I'm Jeff Dodge, Investor Relations, and with me today are Rick Smith, Chairman and Chief Executive Officer; and John Gamble, Chief Financial Officer.

Today's call is being recorded.

An archive of the recording will be available later today at www.Equifax.com in the investor relations section under the About Equifax tab.

During this call, we will be making certain forward-looking statements to help you understand Equifax and its business environment.

These statements involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from our expectations.

Certain risk factors inherent in our business are set forth in our filings with the SEC, including the 2015 Form 10-K and all subsequent filings.

During this call, we will be referring to certain non-GAAP financial measures including adjusted EPS attributable to Equifax, and adjusted EBITDA margin, which will be adjusted for certain items that affect the comparability of the underlying operational performance.

For the third quarter of 2016, adjusted EPS attributable to Equifax excludes acquisition related amortization expense, as well as the transaction and integration expenses associated with our acquisition of Veda.

Adjusted EBITDA margin is defined as net income attributable to Equifax adding back income tax expense, interest expense net of interest income, depreciation, amortization, and the impact of certain one-time items, including the transaction and integration expenses associated with our acquisition of Veda.

These non-GAAP financial measures are detailed in the reconciliation tables which are included with our earnings release and are also posted on our website.

Also, please refer to our investor presentations which are posted in the investor relations section of our website for further details.

Now, I'd like to turn it over to Rick.

Thanks, Jeff, and good morning, everyone.

Thanks as always for joining us.

As I always do, I will start off with some high-level observations for the quarter for the Corporation, dig into some details at the business unit level.

John will go through the financial details, and I'll come back with some closing comments before questions.

Third quarter was just another outstanding broad-based performance by the team.

This really continues to impress me.

The growth we had in the third quarter accelerated from the first half of the year and that added to our strong outperformance year to date.

All four business units continued to execute at a very high-level driving impressive expansion in our revenue, our adjusted EBITDA margins, and the bottom-line results.

For the quarter, total revenue was $804 million, up 20% on a reported basis and up 23% on a local currency basis from the third quarter of last year.

Organic constant currency revenue growth accelerated from the first half coming in strongly at 13% up over last year.

In the quarter, FX created a $19 million year-over-year headwind.

Adjusted EBITDA margin was 35.9% compared to 34.6% in the third quarter of 2015 representing a very solid year-on-year increase and well above our annual 25 basis point target increase and well above our 75 basis point expectation we have for the full year of 2016.

Adjusted EPS was a $1.44, up 26% from $1.14 in the third quarter last year and better than our expectations when we gave third-quarter guidance back in July of this year.

So let me jump into the individual BUs.

As always, I'll start with USIS.

They delivered a solid 9% revenue growth, significant acceleration from the first half driven by broad-based new product revenue including trended data.

We will talk more about trended data in a second and we'll get into it in Q&A as well.

Our trended data now is a reality.

As expected, Fannie Mae launched its Desktop Underwriter in late September and as we indicated during our second-quarter call, billing for trended data began in August for all mortgage-related inquiries.

Revenue for the third quarter largely came in as we had expected.

We have a very good relationship with Fannie Mae and initiated the discussions on trended data with them nearly three years ago.

We continue to see opportunities to work with Fannie in transforming the mortgage space including the announcement just this week of a launch of Fannie's desktop underwriter validation services, which incorporates verified consumer income and employment information from Workforce Solutions.

We believe that will be a nice catalyst for continued mortgage growth for EWS going forward.

Additionally, from our data and analytics team, they continue its efforts to complete a variety of analysis to assess the lift from trended data to other decisioning activities.

We've talked to you about that in the past.

It's really getting down to granular levels by vertical, by sub-vertical, by [data of] unique [data] asset and understanding what the list is.

An example is, trended data provides approximately 15% lift in assessing prime accounts for the propensity to open a home equity loan and a 20% lift in assessing prime accounts for default risk on home equity loans.

With the advent of Cambrian, which you are familiar with, we now have an analytical environment containing over 80 months or more of historical data across many of our unique data assets.

Today, Cambrian is a nonproduction environment providing unparalleled ability to deliver compelling customer insights.

So today, we are after building analytics and insights on trended data is 80 months or more including the credit file and updated unique assets in 2017, we're going to move the 24 months of trended data we have to the credit file to significantly beyond the 24 months in the production environment.

I think that will open up a whole new realm of opportunities to work with our customers to solve problems we couldn't solve before.

Sticking with USIS, on September 30, we reached a long-term agreement with SBFE to become a certified vendor.

We now will be able to combine our CFN, commercial financial network data assets with SBFE data to deliver plan best-in-class solutions for our small business information customers.

USIS is expected to deliver revenue growth for the fourth quarter at the high end of their targeted range, which we communicated is 5% to 7%, and EBITDA margins will continue to be above 50% in the fourth quarter and for the full year.

International, they continue to make great progress on their most important strategic initiatives while delivering third-quarter local currency revenue growth of 60% and organic local currency revenue growth of 10%.

In the quarter reported, adjusted -- in the quarter, they reported adjusted EBITDA margins [expanded], it was like over 200 basis points from the year prior.

The Veda integration continues to go well and remains on schedule.

Some sub bullets under Veda were we talked before our global platform deployment into Veda, which includes Cambrian and SOA, our cloud platform, are underway and expected to be operational in mid 2017.

The NPI processes have been established with a local leadership team and we will be incorporating the Veda NPI revenue into our vitality index beginning in 2017.

We've also identified a number of opportunities to export some of Veda's projects to other international geographies.

Debt placement from the UK government is now up to GBP1.6 billion, and our performance year to date is exceeding the baseline performance we had established.

We now have all six founding agencies of the UK government boarded and have analytical projects underway with two additional agencies.

While the initiative is still in the early stages, we are extremely pleased with both our relationship with the UK agencies and the financial results we are delivering.

Organic revenue in International's five largest verticals, FI, telco, government, retail, and auto in aggregate was up 13% for the quarter.

International decisioning platforms, analytical services, and debt management services revenue grew 19% in the quarter.

These high-value solutions continue to strengthen our relationships with customers and our market position.

In the coming quarters, we will be selling more sophisticated technology platforms i.e.

InterConnect, our SOA platform, and Cambrian throughout our international footprint to drive future revenue growth.

Canada continues to build very good momentum with trended data.

In the third quarter, we launched Cambrian platform which will further enhance our competitive position with best-in-class solutions leveraging trended data.

International is expected to deliver organic constant currency revenue growth in the fourth quarter and the full year above the upper end of its long-term model of 8% to 10%.

Reported revenue growth for 2016 is expected to approach 55%.

Adjusted EBITDA margins should increase sequentially and exit the year approaching 30%.

Workforce Solutions, their strong momentum has resulted in another outstanding performance in the third quarter with 23% revenue growth and a 350-basis-point expansion in the EBITDA -- adjusted EBITDA margin.

Total records in the work number database now approaches our short-term goal of 300 million with over 6,600 different data contributors to that database.

Our initiatives to further penetrate key verticals led to strong double-digit growth in mortgage, auto, government, and pre-employment, to name a few.

Revenue from our healthcare vertical comprised of income and employment verification for CMS and ACA analytics for employers grew over 240% in the quarter.

In the quarter, Workforce Solutions completed the acquisition of Barnett/VJS, a small regional provider of employment and income verification and unemployment insurance services to further accelerate the growth of the work number database.

It's early days and that is going very well.

As I indicated earlier this week, a little more color around Fannie Mae, they announced the integration of our full suite of employment and income verification services into their desktop underwriting platform.

The employment and income verification services includes data from Workforce Solutions' work number database providing instant and waterfall employment and income verification services.

With these services, [unwilling] cycle times will be reduced and the lenders' reliance on applicant providing W-2, paystubs, or other income related documentation will be eliminated, and this gives them protection should a mortgage not perform and protects them from having the banks put the mortgages back to them.

So it's a great benefit for EWS.

Workforce Solutions is having an outstanding year in 2016.

Both organic and reported revenue growth are expected to exceed 15% in the fourth quarter and 20% for 2016, substantially above its long-term range of 9% to 11%.

Adjusted EBITDA margins are expected to be nicely over 45% for the fourth quarter 2016 and in the high 40%s for the full year.

Global Consumer Solutions continues to make great progress on its strategic initiatives, particularly building out a strong market position in both DTC reseller and indirect markets that include partnerships with a number of very successful companies that we have talked about before such as Credit Karma, LifeLock, H&R Block, and others.

We are pleased to announce we've executed a new longer-term partnership with Credit Karma.

The new and expanded partnership is focused on growing both of our businesses by leveraging unique data assets, innovation, and analytics including the use of our Cambrian platform and expanding our partnerships beyond the borders of the US.

This quarter, we deployed our new global consumer platform called Renaissance, a best-in-class SaaS-based eCommerce platform which provides much greater marketing flexibility to serve our partners.

During the quarter, we successfully transitioned one of our largest customers to this new platform and by the end of 2017, we will have deployed this platform across all portions of our US business and will be well underway to deploying it across other geographies in which we operate.

Global Consumer Solutions is expected to deliver fourth-quarter and full-year 2016 constant currency revenue growth exceeding 15% with fourth-quarter and full-year adjusted EBITDA margin at approximately 30%.

A few high-level points at the corp level before John gets into the financial details.

Things we've talked to you about before that are so important to our culture and our results.

First is our enterprise growth initiatives, which are our largest and most complex growth initiatives we have.

They are performing very well in 2016 with revenue generation projected to be up over 35% from our expectations earlier this year, and over 3 times the revenue generated from EGI in 2015.

Our overall performance in new product innovations initiatives in 2016 is also outstanding.

The three-year revenue from our 2016 launches is expected to be more than 170% above the expected three-year revenue from our 2015 launches.

This is the strongest NPI performance we've had since it was built and created some 10 years ago.

Our vitality index, ahead of last year and the pipeline of new products continues to be very robust.

To date, we've launched approximately 40 new products and expect to launch another 20 products before year end.

In summary, our strategic initiatives continue to perform well and are ahead of our expectations we had at the beginning of the year.

With this continued focus on improving the process that allows us to drive continues growth, I expect these initiatives will continue to drive and deliver incremental revenue growth in 2017 and beyond.

So with that, John?

Thanks, Rick, and good morning, everyone.

As before, I will generally be referring to the financial results from continuing operations represented on a GAAP basis.

As a reminder, following the Veda acquisition, we started focusing on adjusted EBITDA margin to more consistently present the operating performance of the segments and the Company as a whole.

The non-GAAP reconciliation attached to our earnings release provides a more detailed description of what is included in the adjusted EBITDA margin.

Now let me turn to the business units' financial performance for the third quarter.

US Information Solutions' revenue was $317 million, up 9% when compared to the third quarter of 2015.

Online information solutions revenue was $230 million, up 7% when compared to the year-ago period.

Total mortgage related revenue in USIS was up 39% in the quarter.

The mortgage bankers application index growth accelerated significantly, up 35% in the third quarter compared to the 20% growth we saw in the second quarter.

Given the much stronger mortgage market performance in 3Q 2016 and continued accommodated interest rate environment, we now expect the mortgage market to grow solidly double digit in 2016.

Financial marketing services revenue was $48 million, up 3% when compared to the year-ago quarter.

Our commercial products suite grew 8% in 3Q.

We have made great progress building the Equifax commercial financial network, which includes tradeline data from banking and other financial institutions similar to the SBFE as well as communications and utilities, wholesale, trade, printing, publishing, chemicals and allied products, and rental and leasing data.

When combined with Equifax consumer credit data, we can now offer substantially differentiated data and analytics toward US commercial customers.

Identity and fraud solutions also continued to grow strongly, up 19% in 3Q and 23% year to date.

USIS direct-to-consumer revenue, principally our revenue with other CRAs, was down over 20% in the quarter and largely in line with the first half.

The adjusted EBITDA margin for US Information Solutions in 3Q 2016 was 50.6%, up from 49.9% in the third quarter of 2015.

Workforce Solutions' revenue was $171 million for the quarter, up 23% when compared to the third quarter of 2015.

Verification services revenue of $115 million was also up 23% and continues to be driven by strong double-digit growth across mortgage, government, auto, and pre-employment.

Employer services revenue of $57 million was up 23% from last year as well.

Revenue growth from unemployment insurance, I-9, tax incentives, and other HR services was consistent with the annual model of mid-single-digit growth.

ACA analytics revenue was up substantially in the quarter versus 3Q 2015 driving much of the growth.

As we had indicated previously, ACA analytics revenue was down sequentially and from the first-half run rate.

As expected, given that the ACA business is seasonal with higher revenue in the first half of the year when 1095s are delivered to employees.

The Workforce Solutions adjusted EBITDA margin was 47%, up from 43.5% in 3Q 2015 and in line with our expectations.

Revenue from USIS and Workforce Solutions, our total US B2B revenue, was $489 million representing organic growth of 13%.

International's revenue was $214 million, up 47% on a reported basis and 60% on a local currency basis when compared to 3Q 2015.

Organic constant currency revenue growth was approximately 10%.

By region, Europe's revenue was $62 million, up 2% in US dollars and up 16% in local currency.

We have seen some moderate impact on local currency revenue following the Brexit vote with selected large UK financial institutions.

Debt management grew nicely in the quarter as our relationship with the UK government continues to perform as we had expected.

The sharp depreciation of the British pound following the Brexit vote in late July significantly impacted US dollar revenue growth in the region for the third quarter.

The almost 7% decline in the British pound in early October will further impact 4Q 2016 US dollar revenue growth.

Latin America's revenue was $47 million, down 9% in US dollars but up 9% in local currency.

The over 60% appreciation of the Argentinian peso from late December 2015 through March of 2016 has negatively impacted the US dollar performance of our largest and most profitable country in the region.

Asia-Pacific revenue was $74 million which is comprised mostly of revenue from Veda.

Canada revenue was $32 million, up 4% in US dollars and up 3% in local currency.

Canada continues to perform in line with our expectations including substantial improvements in the new products innovation initiatives, which includes trended data.

For the third quarter, International's adjusted EBITDA margin was 28.4%, up nicely from 26.2% in 3Q 2015.

On a constant currency basis, margins expanded over 300 basis points versus 3Q 2015 and almost 50 basis points sequentially.

As Rick indicated, 4Q 2016 adjusted EBITDA margins are expected to increase sequentially and approach 30% in 4Q 2016.

Global Consumer Solutions revenue was $101 million, up 12% on a reported basis and up 14% on a local currency basis.

Growth again was driven by our direct consumer reseller customers.

For the third quarter, the adjusted EBITDA margin was 30%, in line with our expectations.

The adjusted EBITDA margin was down from 30.8% in 3Q 2015 but up significantly from the 26.4% in 2Q 2016 when we were boarding LifeLock.

In the third quarter, general corporate expense was $52 million, consistent with our expectations.

For the fourth quarter, total general corporate expense is expected to be slightly above $55 million.

The adjusted EBITDA margin was 35.9%, up 130 basis points from 34.6% in 2015.

The strength in adjusted EBITDA margins reflects year-over-year growth in USIS, Workforce Solutions, and international.

We expect the 4Q 2016 adjusted EBITDA margin to be above Q3 adjusted EBITDA margin, and our full-year 2016 adjusted EBITDA margin to be up more than 100 basis points from the 34.7% we achieved in 2015.

As Rick mentioned before, this is nicely above the target for 2016 of a 75 basis point expansion in our adjusted EBITDA margin.

Our GAAP effective tax rate for the third quarter at 29.1% was below the anticipated level of 32.5%, which we communicated during our July earnings call.

The lower effective tax rate reflects several discrete or one-time items which benefited our effective tax rate by over 3 percentage points and our adjusted EPS by about $0.05 a share.

Our current expectation is that Q4 tax rate will be approximately 32.5%.

Capital expenditures for the quarter were $48 million and year to date are $131 million.

We continue to expect capital expenditures for the year to be about 6% of revenue, which is at the high end of our long-term range as investments are made related to our integration of Veda.

Year to date, operating cash flow remains strong at $525 million.

Total debt in the quarter was $2.86 billion.

We continue to reduce our leverage following the Veda acquisition, which is now down at 2.58 times.

Our target is to reduce leverage back to approximately 2.25 times EBITDA, which we expect to occur in 2017.

Now, let me turn it back to Rick.

Thanks, John.

I trust you agree, 2016 has been an outstanding year for the Company and strong and consistent execution throughout the Company has resulted in a broad-based performance that has significantly exceeded the expectations we had at the beginning of the year.

We firmly believe this positions us well for growth in 2017.

For the fourth quarter at current exchange rates, we expect revenue to be between $797 million and $801 million reflecting constant currency revenue growth of just over 22%, partially offset by about 2% of FX headwind.

This reflects organic growth of over 12%.

The almost 7% depreciation in the UK pound in early October, which John just referenced, resulted in the majority of the incremental $6 million of FX headwind versus our expectations for the fourth quarter we gave guidance back in July.

Adjusted EPS is expected to be between $1.35 and $1.38, which is up 18% to 21% for the fourth quarter.

Excluding $0.03 per share of negative FX, this reflects constant currency adjusted EPS growth of 21% to 24%.

With this outlook, our second half organic constant currency growth is approximately 12% and in line with the outlook we gave in the second half revenue growth during our second-quarter earnings call, which you recall was guided to 11% to 13%.

For the year now, we expect revenue to be approximately $3.145 billion reflecting constant currency revenue growth of approximately 21% partially offset by 3% of FX headwind.

Adjusting for the significant depreciation in FX, principally the British pound, this is at the high end of the guidance we provided in July.

This is also an impressive performance by the team when compared to the guidance we gave at the beginning of the year for revenue, which you'll recall we guided somewhere between $3 billion and $3.1 billion in revenue.

Adjusted EPS for the year is expected to be between $5.45 and $5.48, which is up 21% to 22%, excluding approximately $0.14 per share full-year negative impact from FX.

This reflects constant currency adjusted EPS growth of 24% to 25%.

This is up significantly from the guidance we provided in July and compares favorably to the guidance we gave at the beginning of the year for adjusted EPS, which you remember was $4.95 to $5.05.

For the year, we now expect adjusted EBITDA margins to expand by over 100 basis points, up from the previous expectations which were 75 basis points.

As we look forward, we remain confident in our ability to deliver on our long-term constant currency financial model of total revenue growth of 7% to 10% per year with organic revenue growth of 6% to 8%.

As we look to 2017, considering only the acquisitions closed to date, which to refresh your memory were Veda and the small Barnett acquisition, we expect to achieve revenue growth at the high end of our total growth model.

As it's too early to make a call on the US mortgage market, this assumes the US mortgage market will be largely flat in 2017 and as always, we will provide you more detail on our outlook for 2017 during our February call.

But at this point in time with the way the team is executing on the growth initiatives of EGI and NPI, we remain very bullish for our [theories] in 2017 So operator, with that, John and I would like to open up to questions for our participants.

(Operator Instructions)

David Togut, Evercore ISI.

Thank you.

Good morning, Rick, John, and Jeff.

Hello, David.

Workforce Solutions continues to outperform my model both in the third quarter and indeed really year to date.

Could you comment a little bit about the hit ratio you are seeing as you approach the 300 million work number records in the US?

Yes, let me just talk generically then get the specifics.

You have heard me talk in the past, David, the things going from a growth perspective started with really Dan Adams five, six years ago and continue under Rudy now are just phenomenal.

They're so broad based.

If you think about it, the penetration which is one way to think about hit rate, in each vertical continues to go up.

We continue to expand the size of the database, continue to go to analytics on the data.

Their growth opportunity and our long-term models is very bullish, upper-single digits to lower-double digits.

They have specific projects going on right now and continue to find ways to build the hit rate and work number records.

So generally speaking, it is long term our highest growth opportunity business we have and we remain very bullish.

And combined with that, EBITDA margin at 47%, up 350 basis points year over year, and now actually approaching USCIS EBITDA margin.

How do you think about the margin expansion opportunity of this business over the next 12 to 24 months?

Yes, as we've talked in the past, this business because of the great leverage you have much like the core USIS business or pockets of international, you get high incremental margins, especially in the verification side.

They are doing great things on the employer side, add automation to enhance margin there.

There's no reason to believe that business over multiple years should not see approaching 50% plus EBITDA margins.

Yes, our long term model as we've given has proved to be in the low 50%s and we fully expect it to get there.

Got it, and then shifting gears to USCIS, mortgage continues to outperform.

And I caught your comment about next year and conservatively expecting flattish mortgage market.

How do you think about what the Fed might do in the next couple months and how that might impact mortgage which has benefited from an incredibly positive environment with rates as low as they are?

Yes, I expect refinancing to -- assuming they do, they are all over the board.

That's why we said February will give you a better look.

We'll have hopefully some better insight.

That's that answer.

You're seeing the range is from one rate increase to two to three rate increases.

Up to 75 basis points as low as 25 basis points next year.

Still historically low rates.

You may see softening in refinancing but continue to see good strength in home equity and home sales.

I think the thing we got to keep our eye on in general terms on mortgages, affordability so where does pricing go across the country and what the affordability index look like.

But beyond that, there are so many great things that we've talked about that the team has done for, David, I don't know if it's been 7, 8, 9, 10 years, which is outperform whatever the index does through penetration and innovation.

We talked about obviously trended data for Fannie Mae.

For USIS, we've talked about the use now of the verification income and employment.

Those are just too small examples, but important examples of how we're trying to grow regardless of what the market does.

Understood.

And just final question on trended data, just trying to assess competitively where you stand versus your Chicago-based competitor, which has also been pretty aggressive here.

You seem to have a very deep offering.

They may have a little bit of a time lead if that's an accurate perception but it seems like you have a deeper range of services coming to market in the next 12 to 18 months.

Thank you.

I think everyone is trying to find a way around the trended data.

I've been very consistent with that.

Experian was out there first with batch trended data years ago, so clearly continue and Equifax was not the leaders if you look at it holistically in batch and online.

However, we have moved aggressively and have moved aggressively over the years in all of our geographies to embrace trended data.

I mentioned on my call, we have the most unique data assets so it's not just the credit file that's trended.

We talked about we now have over 80 months in trended data in Cambrian, our analytical environment, and that's many different data assets, not just the credit file, and we are moving.

You will see us move dramatically beyond the 24 months of credit data that's trended in a production environment in 2017, well beyond even 30 months, which I think is a benchmark out in the marketplace today.

We're not handicapped in any way.

In fact, I think we're leading in many senses on trended data.

Understood.

Thank you very much.

Thank you, David.

Andrew Steinerman, JPMorgan.

Good morning, Rick.

You mentioned 2017 is shaping up to be at the long-term of the constant currency revenue growth range of 7% to 10%.

I just wanted to check my math that that would be about 2 points of closed acquisitions.

We're talking 5% to 8% organic?

And the second question is, at that level of revenue growth, will margin expansion pay above the long-term range for 2017?

Yes, what I tried to say in my words there is the in total we will be at the upper end our 7%, 10%.

You can decipher what that means, but comfortably in the upper end of that range.

So the organic growth by default, if you use your math, the 2 points have to be within the organic range of 6% to 8%.

By the way, we also have a very strong pipeline of other M&A things we can be doing, tuck-in acquisitions that make sense to us in all of our strategic areas and geographies around the world.

So we've been very disciplined this year with only the small acquisition of Barnett.

You should expect us to be thoughtful in doing strategic M&A on top of that next year.

And the margin, our target is to deliver 25 basis points per year of margin expansion over multiple years.

You should continue to expect margin expansion new year in that range.

Okay.

Thank you.

Thank you.

Manav Patnaik, Barclays.

Good morning, gentlemen.

Firstly, congratulations on another broad-based quarter, and I'm sure we'll keep asking you for updates on trended data and the collections contract, and so forth, but what I wanted to ask you is, of the 60 new products that you are scheduled to launch this year, as you look out into 2017 and 2018, what are some of the other products or initiatives we should be focused on outside of just trended data and so forth?

It sounded like the fraud platform you said that launches next summer may be one of those?

I was hoping you give us a sneak preview at other stuff we should be looking out for.

First of all, thank you, Manav, for your kind words.

NPI is so ingrained with everything we do now.

When you think about it, we are launching 50 to 75 products a year, or in this case, 60 products, it's different by geography.

Most of our NPI, as you know, tend to be singles and doubles, if I can use a baseball analogy.

Every once in a while you hit some big ones like trended data.

Fraud obviously is a very important growth opportunity for us in the international environment.

We talked about moving what we call [osra] around the world.

That will be a nice contributor.

Mobile, we're doing a lot now around the mobile world and finding out ways to participate in the mobile environment, so we have some great product launches planned later on this year and next year in mobile.

Those are two examples.

I can give you 100 more.

But think about it again as you know us so well.

It's a lot of singles and doubles.

That's where we win in NPI.

Okay.

That's fair enough.

Just on the Credit Karma contract, so I think in the past, you gave us your revenue contribution from them.

I was hoping you could do that but it does sound like the contract is much broader than what in the past.

I think you guys were giving just report and the score.

I just wanted to confirm if I heard that right.

And in terms of expanding internationally, when we heard from Credit Karma at the Money20/20 conference, they mentioned Canada.

But is there anything more than that that you were referring to?

Thank you.

We don't disclose Credit Karma revenue.

But I will tell you this, it has been a great partnership.

It's been a wonderful win-win partnership for two years.

We have now signed a multi-year contract, much longer term.

It will utilize our environment with Cambrian, which is different than the past.

It will be focused on innovation so building products out of Cambrian together.

It will focus on our unique data assets way beyond just the credit file itself.

And then as you alluded to in your closing thoughts here, it'll be going global as well.

And beyond Canada, I'm not going to disclose the specific countries but there are some countries that they are very interested in that we have good market positions and capabilities in, good data assets in, and together we'll both grow new business opportunities for us and the consumers in those geographies.

It is a really good --it was a very complicated long process but the two teams came to a great win-win for both of us for many years to come.

Got it.

And just last question from me.

You talked about this active M&A pipeline for some time now.

I was hoping you could just characterize it in terms of the variant sizes of the deals you are looking at because I think the one that you guys are rumored to be looking at in Australia seems a little bigger than tuck-in but I was just curious on if you could give any color there.

Yes, I think you know us and you've known us for years.

If you think about my 11 years here, we've done three large deals and we did TALX 9.5, 10 years ago, and we did CSC, and we did Veda.

The vast majority of everything else we've done are small tuck-ins trying to get us that 1 to 2 points of growth per year, which is our model.

You should expect us to be in that range looking for small tuck-in acquisitions well aligned with our strategy and delivering 1 to 2 points of incremental growth next year.

That would be our goal.

Thanks a lot, guys.

Thank you.

George Mihalos, Cowen.

Let me add my congratulations on another strong quarter, guys.

Wanted to start off, I'm sure you're not going to size the impact in the quarter of the trended data mortgage contribution, but is it safe to say it came in somewhere ballparking at a little bit below 1 percentage point of overall revenue growth?

And then, John, your comments on the margins for USIS being I think at least 50% for 4Q, should we not expect a little bit of a step-up from the 3Q levels given full quarter of trended data, and then just sort of normal seasonality?

Let me jump into the first part and, John, if you want to address margin.

I'll give you a general picture on margin.

We don't break out trended data for a specific line item, but George, you should think of it this way.

As we set up guidance back in July, the second half of the year, and specifically for the third quarter, the trended data contribution for USIS came in largely as expected.

Almost no, as a matter of fact, no material deviation from our expectations.

It was performing as expected.

It's fairly predictable for us to model that contribution.

And as far as margins, you've got -- you know this, you have fluctuations month by month, quarter by quarter.

There are mix changes each and every quarter.

There is seasonality changes, mortgage is lower volume in the fourth quarter and other quarters, so you put it all together.

I don't really worry about minor changes by quarter.

It's really the multi-year trends, and USIS is starting off at a very, very high margin trending in the right direction.

And then you see really nice growth in their margin, obviously, in the third quarter, good performance in the second quarter.

So I think their margin performance is accelerating and you should expect to continue to see very good margin accretion in the fourth quarter.

We gave a range of over 50%, but you'll see very nice margin accretion in the fourth quarter as well.

Again, the Company has delivered outstanding performance overall as we said year to year.

USIS is a contributor to that and we expect it to continue, and we feel very confident in our long-term model of moving toward 40% in our long-term model.

Great, thanks for the color, guys.

Just last question for me.

As it relates to the Credit Karma expansion, anything we should be mindful of from a pricing perspective as we model the consumer services, the consumer division going into 2017?

Thank you.

I described it really as an apples and orange contract.

If you think of the old contract, it was one geography, one basic product.

And as we alluded to it is now, multiple geographies, multiple products and around innovation.

So it is going to be a growth driver for Credit Karma.

It's going to be a long-term growth driver for us as well.

Andre Benjamin, Goldman Sachs.

Thanks, good morning.

I [guess] my first question.

Lenders as we listen to the commentary from large banks have been largely talking a lot about prime and super prime consumers.

I was wondering as you continue to roll out deeper analytics, how much of your conversation is talking about the ability to use Cambrian trended data, alternative data to get more comfortable lending to weaker credit consumers largely because I know when you framed trended data, you also talked about the uplift to prime loans.

I don't know what that looks like for subprime as well.

Yes, good question.

The answer is yes, we are and have been actively engaged in leveraging our unique data assets to give the underwriters a more holistic view of risk.

That can be things like leveraging the debt to income data that we have on that model, the actual debt to income.

It can be using our [NCTUE Plus] database which gives insight to how consumers have paid off their utility obligations, you have a score.

In fact, many parts of Latin America where the credit markets are nascent we're leveraging alternative data assets there to help bring people into the credit markets.

So that's an active part of our strategy and has been for quite some time and will be going forward.

And more directly, is it fair to say that the uplift that you have observed analyzing some of those lower quality credits is the same or higher or lower relative to the prime bucket?

It really depends on the vertical you are looking at and the geography you're looking at.

The lift you might get in a credit card offering versus an auto loan would be different and it would be different in different parts of the country as well.

And would be different depending how you want to segment subprime from super subprime.

So there are so many nuances.

There's no one generic answer you get but I can promise this of the teams, the [D&A] teams, and I mentioned it in my prepared comments, are deeply engaged with our customers around the world looking at ways to make smart underwriting decisions including subprime.

But as far as we've launched using our alternate assets will drive a substantial number of additional consumers into the market where we can actually score them outright.

I think I gave you two lists in our prepared comments, two examples there.

Yes, my last thought would be if I didn't miss it, but where you stand on launching some of the verification products internationally?

And how that investment should impact the margins over the next couple years?

Great question.

I did not address that in my prepared comments, but yes, this is going aggressively.

I don't know if you are familiar with a thing called enterprise growth initiative, which is just an added way to manage complicated growth initiatives.

The international work number is being managed through that initiative.

Obviously, with [Gree's] team and we've got a handful of countries that are very, very important to us that is going as planned.

Thank you.

Thank you.

Ramsey El-Assal with Jeffrey.

Hi.

This is actually Kristin standing in for Ramsey.

Thanks for taking my questions.

So USIS had very great acceleration from the first half.

Is your expectation still for this segment to be at the lower end of the 5% to 7% range?

It seems like with the new products and with such a robust mortgage market, there could be some risk to the outside?

I think you are referring to the fourth quarter or the full year?

I'm not sure what you said.

Next year or what you're referring to?

For the full year, I believe you all prioritized had been to the lower end of the 5% to 7% range?

For the fourth quarter, we indicated we expected to be at the high end of the range, and for the full year it will be within the range.

Absolutely.

The first half started slightly below the range, very good performance in third quarter at 9%.

We are expecting high-end of the range in the fourth quarter so when you average those out, we'll be nicely within the range for the full year.

Right, so I think last quarter you guys said that it would be at the low end of the range but now we're just going to be somewhere inside the range.

Is that correct?

Yes.

Yes.

Okay.

And my second question, is there any way to parse out how much ACA has contributed to the very robust growth within Workforce Solutions?

Well, I thought I had mentioned it in my prepared comments, and this has been couple of years in a row now, it's extremely broad based.

I went through the different verticals.

ACA, or as we call healthcare which is ACA, is a part of that offering was up 240% year on year.

It's a good growth contributor, but there are so many other things going on across EWS that are driving growth, it is far more than just ACA.

We give you verifier and we've given you an indication of the growth of the other portions of employer so there's quite a bit of information available for you do some analytics on that.

Sure, and then my last question is, has there been any surprises on the data integration so far?

And is the expectation still for EPS accretion of $0.20?

The answer to the last question is yes, and the answer to the first part of the question is no.

Surprises, I mean anytime you buy a company you may have a surprise here and there, but nothing material by any means.

And it's going extremely well.

We've got members of the Veda team here up here right now, teams down there.

So it's -- cultural integration will take, as it always does, longer than process integration.

The acceptance from the customers of the things we can now bring to those markets has been warmly received, so all in all, it's going very well.

Great, thanks very much, guys.

Thank you.

Toni Kaplan, Morgan Stanley.

Good morning.

You mentioned the Fannie rollout of Desktop Underwriter integrating the employment and income verification.

So when should we expect to see an impact from that in results?

And how should you frame the lift that we should expect from that?

Thanks.

Toni, they just announced it I think it was Monday or Tuesday of this week.

It just takes a while to get this system, the underwriters changing behavior to do so.

There's a lot of opportunity for further penetration across the mortgage underwriter market.

We have not financially disclosed what the lift will be for EWS, but clearly mortgage is an important part of what the banks do.

Mortgage is an important part of what EWS does, and should be a growth driver form I would say starting in late 2016 and in 2017.

Great, and then in terms of overall margins, in the past you have given a guidance target of about 25 basis points a year.

This year, you will be far above that as you mentioned in the earlier remarks, and just what we have seen so far this year.

Should we view 2017 as sort of a more normal year or would that still be elevated just given some of the large home run products that would still be flowing through?

We will give you more insight specific to margin in 2017, in February.

Remember, our overall goal is to get to 40% EBITDA margin, so in the years ahead, so we will give you more color.

John, unless you want to say anything else.

I'd expect 25 basis points or so next year.

For us to deliver on over long-term model over the strategic period, it's going to have to grow faster than that and we are expecting another good year next year.

Thanks a lot, guys.

Congrats on the quarter.

Thank you.

Gary Bisbee, RBC Capital Markets.

Good morning.

I guess I just wanted to ask about the breadth of the various factors that are contributing to the EGI and NPI success this year.

Obviously trended as you said is sort of an outsized relative to the singles and doubles you target, but if you were to look at what you've done without trended, has the momentum been in line with what it's been the last couple years?

Has it picked up, and how do we think about the breadth of it?

Thank you.

Gary, the trended data as you may recall, went live in August of 2016 and if you go back -- so the EGI financial benefit and the NPI financial benefit are way, way, way beyond trended data.

I don't recall the exact numbers, but we talked about 2014, 2015 class of products in NPI being some of our stronger classes in quite some time, if not ever.

We talked about the full class of products in 2016, it was -- trended data is one small part of that was up in third year revenues some 170% above 2015.

We talked about EGI, our enterprise growth initiatives, Gary, ebbs and flows in any one year or maybe eight big initiatives to I think the highest I ever remember seeing is 12, 13, 14 initiatives.

And in this case, trended data is only one piece of all those.

In my prepared comments, I talked about that being up some 35%, I think it was, over expectations at the beginning of the year.

So while trended data is important, there's so much more going on in this Company around innovation and growth initiatives than just trended data.

And if you think about it, every one of the BUs has a substantial EGI contributing.

Certainly you see trended in USIS.

You have seen ACA and then other tremendous opportunities being delivered in Workforce Solutions.

The entire direct-to-consumer initiative that you've heard about, in GCS including the rollout of the Renaissance platform, which we talked about this quarter is a major driver in GCS, and the great success in debt management internationally driving growth also.

There's one in every BU as well as ongoing success in NPI beyond that, which is also substantial.

So it's very broad based.

Great, and then just a follow-up question.

Given how strong and broad the results and momentum has been this year, are there any points this early in the process that you'd point out we should think about as really tough comp areas or anything for next year?

I guess I'm trying to think about phasing of the UK contract.

Do we see Europe slowed towards how you have described the longer term.

In employer services, is there the ability maybe at least to comment on those two to grow on top of such strong growth with ACA this year, and anything else you can think of?

There's [a pack] of stuff.

You could factor in the macro stuff.

What goes (inaudible) headwinds next year.

Interest rates, I think David Togut asked about mortgage -- I think he said the mortgage market was up strong double digit, 20% or so, 30% this year.

You should not be expect that, and I said that in my comments.

Mortgage to be up anywhere close to that next year and flattish would be a good number.

You always have nuances and part of the challenge that Trey Walker and his team have on NPI is you have ramp up surprise and they decelerate over some period of time.

You've got to replace that with the next grade product.

Again, we've been at that for 11 years now so that's nothing new.

So specifically, one part of your question, which the UK contract, you should expect that to ramp into next year.

It went live -- it wasn't even a full year this year.

We'll have a full year next year so you can expect that to continue to ramp next year.

All of that was contemplated in the framework that John and I gave you when we talked about guidance for next year in that upper end of our long-term total growth rate of 7% to 10%.

When we talk about Workforce Solutions and personal solutions that are both growing dramatically higher than their long-term model, we said over time they'll start to move back toward their model, still with outstanding growth, still next year growing incredibly well but we have indicated they will start to move back towards their model over time.

Great, thank you.

Ato Garrett, Deutsche Bank.

Thanks for taking my questions.

You guys have pointed out the strength that you have seen within Workforce Solutions coming from your healthcare or ACA compliance comp for this year.

As we think about going forward, how much run rate do we really have left?

And as we think about 2017, are we likely to see the same kind of first half seasonality that we saw this year?

Let me go generic and specific ACAs.

Generically, there's a lot of runway left in EWS to grow.

There's so many levers they have to grow.

ACA is one component of that.

I would expect ACA -- you had this surge of ACA in 2015 and 2016.

It depends on what happens with fines and the fines get the attention of employers and hence a renewed interest for another surge.

Our expectation is ACA tends to modulate a bit going forward after two really good years.

It doesn't mean it goes negative.

It probably won't grow at the same rate it's grown, that 240% in the third quarter.

If you think about the overall model of EWS, which is strong, strong upper-single to lower-double-digit growth, that should continue for not only 2017 but well beyond that.

In terms of the seasonality of ACA, it's a seasonal business.

It's just from revenue recognition.

There's more revenue recognized in the first half than the second half because 1095s are delivered to employees in the first half and the way revenue recognition works, you have to record more of the revenue with the delivery of the product of 1095 than you do for the remainder of the year.

That's just accounting in terms of the way revenue is recognized during the year.

Great, thanks.

You mentioned that you now have EUR1.6 billion already processed through a debt contract the UK government and you were looking at onboarding two more government agencies.

Can you just discuss what that's going to do to your overall pipeline for the amount of debt that you're going to be placing to the contract and where you are and what's already been secured?

I alluded to the fact that it's early days right now, Ato, on that.

The primary focus right now is making sure we deliver the value proposition that the government expects on that GBP1.6 billion and that 1.6 of it grows great and we are seeing a outperformance versus expectation from our perspective and our customer's perspective which bodes well.

If that continues that creates a halo effect and other agencies are going to give us some of their data.

We're not going to break out the expectations at this juncture.

When we have more progress on the other agencies, we will be the first to let you know how it's going.

You do have to remember that HMRS is a contributor now and they are by far the largest source of that.

Great, thanks.

Lastly, looking at your comments regarding the fourth quarter, correct me if I misheard this, but I think you said that there was a $6 million incremental revenue headwind due to the depreciation in the British pound.

Is that relative to what your expectations were when you last gave guidance in July?

Or just wanted to think about how to frame that $6 million relative to your 4Q guidance?

The $6 million FX headwind since we gave guidance in July so versus our guidance in July.

Got it.

Great.

Thank you, and that's all for me.

Thank you.

That's specific to fourth quarter to be clear.

The $6 million is specific to the fourth quarter, not the second half.

Great.

Andrew Jeffrey, SunTrust.

Hello, good morning.

Thanks for squeezing me in here, guys.

Lots of good information on the call as usual, Rick.

Wanted to ask about Veda just in so far as it seems year to date that perhaps it's outperforming the expectations you had when you closed the transaction.

I wonder if you can just characterize that.

And then as you think about Cambrian and NPI and enterprise investments in the region next year, what's the ballpark organic revenue growth that we should be thinking about for Veda?

As you mentioned, Cambrian, largely I would say holistically Veda is doing as expected, maybe financially slightly better than expected and we talked about the increased accretion as one measure of that outperformance.

As I mentioned in my comments, osra which is our fraud platform, and Cambrian, when we rolled out some time mid to late next year.

Think about that as being a multi-year kind of benefit.

It takes a while to ramp that up and gain traction so I don't see it significantly changing the financial performance of Veda in 2017.

Veda we talked about being organic growth within our range of 6% to 8% over multiple years.

Another thing we talked about is that Veda gives us access to a whole new geography.

We will look over months and years to come using that platform to acquire other strategic assets in the region that makes sense for us.

Okay.

And if I can dig in just a little bit more on the TDX government contract quickly.

Can you just talk a little bit about how much of the total debt you might be able to address over time given that some of it isn't collectible?

I'm not sure.

I'll think about that.

I guess $22 billion or so.

Maybe that's the wrong way to think about the TAM on that contract and if so, disabuse me of the notion.

Clearly, we have not modeled quite that way.

The universe of opportunities is GBP22 billion.

Our whole focus now is on the stuff they've given us to date, make sure it's the right quality, right mix of debt, and our team is performing analytics at the right level to provide value and that's been the case.

I'm a firm believer if you prove value to the customer, in this case the UK government, they will continue to find ways to expand not only the GBP1.6 billion but get other agencies to contribute as well.

All I know is right now is making sure we deliver on the promise to Her Majesty's government.

It's important to remember that those agencies do collect some of the debt themselves internally.

Absolutely.

And have the right to do that within the contract.

At this point, it's unclear as to what that mix will be over time.

So we were just saying then there's of the GBP22 billion they find a piece of it where they think our analysts could add value they place that [so or so] as we continue to add value and increase the lift on the collectability, they will give us more.

Don't think about it as being all GBP22 billion.

Okay.

Thank you.

Thank you.

Bill Warmington, Wells Fargo.

Under the wire.

Thank you very much.

Congratulations on the strong organic growth.

So one question for you.

On mortgage related revenue, it looked like it was about 18% of total revenue.

I just wanted to confirm that first.

And then I think in your comments, you mentioned that you viewed the mortgage market -- your assumption for 2017 was that the mortgage market was going to be flat.

The MBA forecast that came out on Tuesday is projecting the 2017 market down 14% on a dollar basis, so assuming price appreciation on houses of maybe 6%, that gets you to around 20% down in terms of unit volumes.

So I guess my question is, is the expectation that the higher revenue per unit on trended data and the Fannie Mae DU validation service is going to be able to -- and other products are going to be able to offset that expected decline in unit volume?

Is that the rationale?

(inaudible) -- the mortgage business in the US is important for our customers and is important for us.

We've told you we're in the range of 15% to 20% of revenue comes from the mortgage related activities.

We're clearly still in that range.

We expect to stay in that range for the balance of the year.

If you go back and look historically at the mortgage banking index, and forecast versus actual, it's all over the board.

We take a series of economists including our own economists and analyze different trends and from that make assumptions that we build the guidance for, we've done that historically.

That was in the framework we just gave you, a flat next year.

We're going to allot more come February.

All we try to do for you is you know how big mortgage is.

You can make your assumption what you think the mortgage market is going to do.

We think at this juncture a market performing somewhere in that flat range is reasonable, and the market has been a long for a number of years now, on the low side and the high side.

We'll know a lot more in February.

That's a good starting point for us.

Okay.

Fair point on the MBA forecast.

It's tough.

Thank you very much, and again, congratulations on the strong quarter.

Thank you.

Jeff Meuler, Baird.

Good morning.

How could have verification services solutions evolved over time?

I thinking of things like more attributes collected.

You hit slightly on analytics, maybe better leveraging the historical records, but if you could talk about innovation in that segment specifically and how much of the growth it drives.

Thank you.

Yes, it's important.

As I think about it, Jeff, it's [continue were no records to] database.

It's continued to penetrate more and more verticals at a deeper level.

We talked in the past about automotive, card and others being good penetration but a lot of room to go.

Still room to go in penetrating the mortgage market.

We just talked about launching the verification business on a global basis.

That's early days.

That's a investment [warning] now that I think pays dividends 3, 4, 5, 10 years down the road as a long-term great growth lever.

Analytics will continue to be a big part of what we do as well.

It's really, really broad based.

Also, there's been a lot of innovation in the way we obtain records and partners, so a lot of the investment has been around building up partnerships to get more records faster and also about the technology that we use to allow smaller employers to much more easily board their records to Equifax so that they can get the benefits at a much, much lower cost.

Thank you.

Finally, John, can you just comment on year-to-date free cash flow and the full-year expectation?

Sure.

Year-to-date free cash flow continues to be very strong.

We are expecting to have a very strong fourth quarter, so for the full year we are expecting our free cash flow to be very, very good and continue to be good as it has been.

It's a little below where it was last year generally because in a year we have very strong earnings like we had last year, we pay out all of our incentive compensation in the next year.

It tends to drive down cash flow in the year following a very strong year.

And we've had a little bit weaker working capital which we are working on to recover.

We're expecting very strong free cash flow again.

Thank you.

Shlomo Rosenbaum, Stifel.

Thank you for taking my questions.

Rick, can you give a little bit more of an update on Europe?

It looks to me if I normalize for the FX headwind in the quarter, on a sequential basis the European business seems flat sequentially.

I understand that you do have good growth year over year but would've expected that the UK government contract would have put in some more growth over there.

Can you talk about some of the dynamics that are going on because of Brexit outside of FX in Europe?

Yes, I don't have the numbers committed to memory.

Maybe John does but overall, Europe continues to perform and year-on-year growth is good.

One of the things we are seeing is that the Brexit has created some uncertainty for the UK market.

And kind of a pause button if you will for some our customers seemed a little slower in their activity than maybe we had expected.

But where that goes is hard to say.

It's still two-year timeline for the full exit.

But overall, when you think about the UK, you think about Spain, you think about that universe which we operate, the team has continued to deliver solid growth results in a very sluggish environment.

And the pattern of our revenue sequentially is fairly normal with what you would normally see in Europe.

Yes, we are seeing growth in the UK government contract, but again, it's not the largest piece of revenue we have in Europe.

Obviously, our traditional business is much larger so we are seeing continued growth but the pattern of revenue looks very normal to us.

By the way, Spain continues to do some amazing things and delivers some great results largely aided by NPI.

Okay.

That's good color.

So where are we in terms of being able to use the UK government as a model for other countries?

Is there enough data that you've been able to prove that you can do it?

Or do you feel like you need maybe another year before you can take it out to some other countries like that?

I think I announced last quarter the fact that we won a significant multi-year contract that will arrive later on this year in the UK -- in Canada.

So we already have, as you know, operations in Australia.

We have operations down in Central and South America.

Specific to the IRS equivalents around the world, we have not yet attacked those opportunities.

We are attacking a traditional customer base with that analytic capability in many countries and it's already providing revenue for us.

So from a government standpoint, that's out there but not as fast as it is on the commercial standpoint?

Is that the way to --?

Yes, we just stood up a global government vertical so I should say standing up now in last couple months.

That global government vertical will take all of our capabilities to bear to governments around the world where it makes sense, including the debt management collections analytics platform of Inffinix and TDX.

So it's not yet yielding revenue because we had not yet intentionally focused on it outside the UK.

Okay.

Understood.

And then a question I've asked you guys before, just where do you stand in terms of getting some of your existing ACA clients to contribute their income data to the [tauch] database?

Yes.

They are doing a great job, a really good job on that.

And systematically I think we've talked about it in the first quarter.

I can't remember when it was.

We talked about the technology that allows it to be easier for the ACA platform users to onboard their records to us, so that was launched sometime earlier this year.

Jeff, do you remember when that was roughly?

Second quarter.

That was in the second quarter of this year.

So we had the technology capability and it is a contributor to date to the work number growth that we are seeing.

Okay.

Great, thank you.

Thank you.

Tim McHugh, William Blair.

Yes, thanks.

Most of my questions have been asked but just one, maybe Latin America.

I apologize if I missed it, but the growth, it's kind of gradually slowed a little bit the last few quarters.

Anything happening there I guess that explains that and any reason to expect that will accelerate obviously on a constant currency basis.

Argentina is our largest country in the region.

Obviously, Argentina's GDP growth is negative this year, so their performance is a little weaker but no, we don't think so.

We think Latin America continues to be an opportunity for us to grow.

There's one thing, Tim, that gives me great hope for Latin America.

It's a great market for us as you know as John said.

It has been for years.

I am more bullish about the outlook for Argentina and what the government is doing locally in Argentina to fuel growth and the economists now see that the projections for GDP growth for the outer years are stronger than I have seen in quite some time.

The projections for currency stabilization are better than what we have seen and some -- here's the numbers right here.

The forecast right now we have for Argentina, as John just alluded to, is negative this year about 1% or so in GDP growth.

In the next three years, the consensus forecast is between 3% and 4% GDP growth for 2017, 2018, and 2019.

So we're in a good position in Argentina.

We're a leader in Argentina in all verticals, in analytics as well as the core credit business.

So I think better days lie ahead in Argentina, and when you see that, you see an updraft in general terms for Latin America for us.

Would you be willing to tell us roughly how much Latin America we think about is coming from Argentina?

It's our largest operation in Latin America and we don't size that one.

Okay.

Thank you.

Thank you.

Brett Huff, Stephens.

Good morning.

Thanks for taking my question.

Just two ones.

First of all, you've already told us you are going to be near the high end of your long-term revenue growth range next year, but even given that, Rick, is there any product or segment that you feel particularly hopeful about that if there's upside to that outlook, where might that come from?

You know, I don't think there's any one lever on NPI, EGI that gives us -- maybe at the business unit level.

As I said for quite some time, EWS has got the longest growth potential we have and that will hold true in 2017 as well.

But the neat thing is, is the performance [credit] as you've seen is so broad-based across verticals, countries, BUs, EGI, and products.

Might there be another big EGI that comes up or another big NPI product that might come up?

I think mobile offers some really interesting opportunity for us.

I think trended data beyond just the credit file offers some opportunity for us.

Maybe we will see it this desk underwriter platform that's incorporating the use of verification income and employment.

That might provide some upside, but it's really -- it's [not] broad based.

Okay.

And then my second question is again a little bit bigger picture is, you guys have done a good job of creating and buying proprietary databases that you can kind of use in conjunction with the credit file that differentiate your products.

What is the next phase of that?

Is there a particular database or type of data that you're looking to build or buy the next EWS or the next telco credit file, anything like that?

Yes, so we have in Trey's organization out of the data analytics team is a strategy that's linked to each country and then every vertical in the country.

I always tell people there's no generic answer.

It might be in Argentina, in the auto vertical.

There's a data asset we want to buy and build a partner with.

In Australia, there might be something different there.

It's a big core part of our strategy.

We don't tend to divulge on a forward-looking basis which assets we want to build.

The one we have talked about that you have seen is the work number database going global.

Great, that's very good.

Thanks for your time.

Thank you.

I'd like to thank everybody for their time and their support and interest in Equifax.

And with that, operator, we'll terminate the call.

That concludes today's presentation.

We thank you all for your participation and you may now disconnect.