Good day everyone and welcome to the TransUnion, First Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note, this event is being recorded. I would like to turn the conference over to Aaron Hoffman, Vice President of Investor Relations. Please go ahead sir.

Good morning everyone and thank you for joining us today. I’m joined by Jim Peck, President and Chief Executive Officer; and Todd Cello, Executive Vice President and Chief Financial Officer. We've posted our earnings release and slides to accompany this call on the TransUnion Investor Relations web site this morning. Our earnings release includes schedules which contain more detailed information about revenue, operating expenses and other items, including certain non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are also included in these schedules and as a reminder, today's call will be recorded and a replay will be available on the TransUnion web site. We will also be making statements during this call that are forward-looking. These 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 release, in the comments made during this conference call and in our most recent Form 10-K, Form 10-Q, and other reports and filings with the SEC. We do not undertake any duty to update any forward-looking statements. With that let me turn it over to Jim.

Thanks Aaron. As I am sure as everyone has already seen this morning we have some additional exciting positive news on top of our strong first quarter financial performance. I will spend most of my time talking about our acquisition of Callcredit in just a moment. First let me quickly highlight our strong start to the year extending the momentum we've had over the past three years. Our teams continue to execute against our strategies and deliver growth well above the underlying markets in which we operate. Once again revenue grew double digits for the total company as well as for each of our segments, similarly adjusted EBITDA and adjusted EPS both increase significantly. In the segments USIS’ performance was outstanding driven by ongoing strength in financial services in health care and in particular we continue to see exceptional results for credit vision and credit vision link, we believe that our suite of ever evolving trend of products has many years of substantial growth still to come in the US alone. In international we continue to see very strong growth in India in January across our global footprint, notably we saw modest revenue growth in the quarter in South Africa. Last year we invested in our technology infrastructure there. This allows us to reduce cost by fully moving [indiscernible] our final legacy mainframe at the same time the technology platform will facilitate the efficient lift and shift of the innovation and capabilities that should stimulate our long term growth there. Seeing South Africa return to growth this quarter is a good sign that the business is starting to stabilize and is heading in the right direction. And finally in consumer interactive, I'm pleased to announce that we recently signed another strategic partnership agreement, this time with American Express. American Express…

Thanks Jim. I'd like to spend a minute talking about our plans to finance Callcredit, the impact on our leverage and the path to unwind the leverage. The purchase price is about £1 billion which is approximately $1.4 billion at today's exchange rate, since we will be raising US dollar funds to pay for the acquisition we are considering options to hedge the foreign currency exposure to avoid a negative impact on the amount of US dollars needed at closing. We expect the transaction to close either a late in the second quarter or early in the third quarter pending regulatory approval, during that time we'll be working on the financing arrangements with a focus on delivering the most efficient and cost effective capital structure for TransUnion. We've already secured firm financing from several banks to allow us to sign and complete the transaction and just to make one point clear we will not issue stock to fund this transaction, that markets remain solid generally and TransUnion has a strong balance sheet and cash flows to support the incremental leverage. We believe we can finance this transaction attractively based on current market conditions and outlook. With the addition of Callcredits adjusted EBITDA and the incremental debt, we estimate that our leverage should be about 4.2 times when we close the transactions. We expect that metric to return to our target of 3.5 times or less by the end of 2019. This should have been largely as a result of the strong expected increase in Callcredits adjusted EBITDA that Jim discussed and finally based on our current assumptions about the business and the financing we expect Callcredit to be roughly EPS neutral in 2018 and creative in 2019 and beyond. As Jim mentioned, we had a strong first quarter. Let me…

Thanks Todd. And our enthusiasm about the acquisition of Callcredit, I don't want to lose sight of the exceptional performance we delivered in the first quarter which led to our ability to raise guidance for the full year. We are well positioned to have another very strong year in 2018. And that allows us to continue to stay aggressive and truly leverage the very unique assets of TransUnion. We have become industry leaders in technology innovation. We built and grown at diverse set of vertical markets. We consistently expanded and refined our global operations by leveraging all of these capabilities across our enterprise, we cannot only win marketplace today but we can even better position ourselves for continued great success over the long term. With the acquisition of Callcredit we have real conviction that we are adding another foundational piece to our long term growth algorithm. This strengthens our ability to consistently deliver top tier revenue growth and attractive expanding margin. With that I will turn the time back to Aaron.

Thanks Jim. That concludes our prepared remarks. For the Q&A, as always we ask that you each ask only one question so that we can include more participants. And now we will glad to take those questions.

[Operator Instructions] And our first questioner of today will be Tim McHugh with William Blair, please go ahead with your question.

Thank you. First I guess I want to focus on I guess Callcredit just two aspects of the question. One is press release even from the company and some other sources, I have seen suggest that I think they have been quoting £201 million of revenue in 2016 so I think it's not apple to apple comparison but can you reconcile that for people who might see those headlines and I guess you are not buying part of what Callcredit historically reported at their revenue and then secondly I think along those lines, people are trying to do the math on what implied about growth rates at least in the most recent years in 2017. So I don't think you gave that but if you did I apologize for missing it.

Good morning Tim. This is Todd. I will take that question for you. So yes the number that you see on that Callcredit has pertaining to the £201 million of revenue is prior to any accounting changes and it's predominantly IFRS. They were preparing their books on that matter in 2017. In 2018 they did move to that to the new guidance that's there. So that's predominately what the biggest change is. It's just simply the accounting side of it. As far as the growth rate that at this time it's just not something that we are prepared to provide.

Okay. Thank you.

And the next questioner of today will be Manav Patnaik with Barclays. Please go ahead.

Thank you. Good morning guys. I just wanted to see if you could flash out a little bit more in terms of how we should think about quantifying the synergies. It sounds like you are talking about broad revenue and cost, maybe on the cost side just your comments on the meaningful opportunities to optimize and so forth, should we think about that margin heading towards the true margin?

Good morning Manav. This is Jim. So as far as, I guess cost synergies go these are fairly straight forward things that you would expect given our ability to spread our global operating model and I think we have proven that to you all over the last several years. So we feel very good about it and it's not a stretch. As far as margin goes we are always seeking to get all our portfolio companies kind of to the same spot because that I think it's consistent with the idea of having a global operating model outside of any aberrations that comes and having a business that has different cost characteristics. So I think you could expect overtime that we get to the same kind of margins as the rest of TransUnion and that will come through both improvements in operations that are going to happen fairly quickly as well as integrating things like CreditVision, CreditVision link which we believe the UK market is very right for these good time margin kind of capabilities and so that all kind of factors right in on really good top line growth along with continually expanding margins.

And our next question today will be Andrew Steinerman with JPMorgan. Please go ahead.

I was intrigued that Callcredit had a third of its revenue in fraud solutions. I want to make sure that all B2B revenues in terms of fraud solutions and when you turn and look at your own USIS, what percentage of revenues are in fraud solutions and does Callcredit really kind of maybe give ideas to USIS of that has a bigger opportunity in fraud solutions for B2B.

Good morning. To answer the first part of your question, the fraud solutions are all B2B. They do have some very interesting tools that we believe we can use not only in the US but across all of our portfolio kind of geographies and we also believe there are things we are doing in the US that they are going to be able to use. So we are going to build a best of breed there. I don't believe we point out what the fraud revenue is other than it is growing double digits in the US and we have our whole suite of products and something we are very bullish on. And we are also by the way bullish on Callcredits standalone position in the state. So I think it's only going to get better with some of the things that we can add and I am just repeating myself now and as you said we were going to be able to use some of what they do across our portfolio and these are things we have already talked about and they are really not that hard to do and when I say that I mean they are not hard to leverage in different spaces. So we are quite excited about that, fraud as you know isn't going anywhere and that market is going to continue to grow double digits for as long as I think we can project out.

Great. Thank you.

And our next question here will be David Ridley Lane with Bank of America Merrill Lynch. Please go ahead.

Good morning. I know that you cited new products, as the reason for acceleration in USIS, have your win rates new opportunities meaningfully increased over the past six months?

I don't think so. We have been winning I guess for three, four years now with these solutions and what we really have if you kind of think of the whole story we have not only put new solutions in place but we have also retooled our sales force and brought them into much more into a kind of solution selling mode. And we have also I think gotten better and better at perfecting which we are not there yet, we will never be there the ability to manage the pipeline and so I think I have mentioned in previous calls that our pipelines are strong across all businesses and even across all types of customers from big customers down to smaller ones. So I would say our close rates just continue to be strong and the pipeline continues to be strong. And the bigger customers take longer because there are a lot of other priorities and they have a different risk profile and I would say the smaller customers we have done a really—with the mid to small we have done a really nice job. So I feel good about the strength of what we are closing but also the strength of the future based on the pipelines we built and these are very strict forward things that we have in market like CreditVision and CreditVision link, fraud Creditview which we just closed AmEx as we talked about. So there is no horses that we are riding here that are on a [indiscernible] kind of, these are things in the market and doing very well.

Given the outperformance in the first quarter, do you still expect high single digits revenue growth of USIS or is that expectation moved up with that?

So we are expecting similar to the guidance that we provided earlier in the year for USIS in total to grow on low double digits for the remainder of 2018.

Thank you very much.

And our next question for today will be Jeff Meuler with Baird. Please go ahead.

Thank you. You have called out that there is superior data, you talked about income data, can you just give us a sense of how broadly they have it on UK consumers, what the source of the data is and then I guess maybe simular to Andrew's question on fraud the potential to port those capabilities and reminder of where else you have income data I think may be South Africa?

Yes. So they have data and I think 99% and obviously all the UK citizens. They get it from traditional sources just like anywhere else, banks et cetera. But they also built up overtime non-traditional sources of data and that's given them the kind of the first mover advantage in that space. Now that doesn't mean others can't go there. This is no different than any business that we are in or any country that we are in where we constantly have to keep innovating in order to stay ahead of the game. So I wouldn't – I don’t think anybody would tell you that there is some advantage here that's permanent and I think we have always been consistent with that. The permanent advantage is the capability to keep innovating and that's where we are going to keep doing. And that said, they do have a very nice head-start now that's allowing them to take share and you can see that they built themselves and they are the second largest bureau in the second largest market which is growing very, very well. So they have a lot of momentum and great running start and we are going to continue to augment that with things that we bring to the table like CreditVision and CreditVision Link combined with things like their affordability tool which I think gets that the income data you are talking about but that's still more extrapolated from checking saving account information that's given to the CRA and again they have head-start on that that's allowed their matching to be much better than the competition which is again allowing to take share. TransUnion, you asked about the income data, there are markets where we have income data but for the most part we don't. There are other ways to get at it but that's not the secrete to our success, our success is largely driven by our technology, our ability to innovate. Certainly access to data that most other companies in the world simply don't have access to which makes us successful. So I hope I am getting answer to the question. Regarding fraud, I’ll just repeat myself that they have a good set of tools, they get set everything from real time identity management to email and mobile ID checks to monitoring devices, to even some AML KYC that is very effective in the market. They will be able to use some of our technologies like Trustev and others once we close the deal. And we will be able to use some of their IP in our business not only in the US but around the world.

Thank you.

And our next questioner today will be Toni Kaplan with Morgan Stanley. Please go ahead.

Good morning. In the past, you have focused more on growing an emerging markets, does this acquisition change your international strategy to focus more on developed markets as well going forward and just beside from the UK and Lithuania there are other geographies where Callcredit is concentrated? Thanks.

Yes. So. Just reminder that Lithuania is only the –we don't have a business there, that's just where our Callcredit does some of its development out of and our strategy with regards to international has always to be in good geographies and we definitely emphasize particularly with India and Columbia liking emerging markets where the markets are growing at double digits. The UK as we talked about just so happens in their credit and the related market which is 2.4 billion and is growing double digits and we are projecting that to continue and to maybe even accelerate a bit. So we view that as very, very attractive market. So we will go to any geography that is let's say big enough and then has the growth characteristics where we think that we can apply TransUnion's global operating model and have it make a difference, I think this is right in our sweet spot and we are very excited about just the growth in the market. We are very excited about the business that's been dealt there with the Callcredit. We have been following them for very long time so this isn't something we are just kind of getting used to understanding and we are excited about that market the rightness of it to take in things like CreditVision, CreditVision Link, they simply don't exit there and Callcredit has all the tools it needs to be able to do that in combination with RIP. So these are things we are going to be I think able to immediately put in there and help them to continue to take share and continue to grow at double digits. And like we talked about there is also fraud, there is also digital marketing and other areas that are going to be nice growers as well. So the bottom line is it's just the very attractive market and as far as some people are asking me is this a pathway to the rest of Europe and I don't think so. If you are company like ours we know how to be risk information solution provider because we are at in the US and we are that in many other countries. Being in the UK doesn't give you some kind of special intellectual capacity or otherwise to be in other parts of Europe, we already have that. So this is just a great investment because we are in the second largest credit market with the fastest growing bureau combined with all the capabilities we bring to the table. This is right in our wheelhouse and we are super excited kind of chopping into a bit to get through this regulatory period and to work with that team there to continue their march and our march to continue to being the fastest growing players in the space.

That's helpful. Thank you.

And our next questioner today will be Andrew Jeffrey with SunTrust. Please go ahead.

Good morning guys. Thanks for taking the question. Nice momentum in indirect and certainly impressive win with AmEx, a marquee customer. Can you frame up what do you think the seeing the TAM is in that market or at least where your share might be and what you think it could be just trying to frame up what you think the long term growth potential is in that business?

You are talking about the indirect market?

Indirect consumer, yes.

Yes. I don't think we sit and throw our numbers around total addressable market. It's actually evolving quite quickly as we go and just to give a little history there we partnered with Credit Karma years ago and we have learned a ton with them and we still remain in very tight strategic partner. But as, I think credit awareness has become more and more, ubiquitous not only in US but around the world other kind of institutions are getting engaged into she chase, AMEX, [indiscernible] et cetera and many others and so I don't think even a couple of years, four years ago, we had thought that this would be the case so with regards to runway there are FinTech out there, there are other companies like Intuit that I think see value in engaging their consumer with a very important part of their lives which is how their behaviors impacting their ability to get not only good terms on loan et cetera but insurance and other things and goods and services. So we believe there is a lot of runway. Heading forward, we have strong pipeline there, I think we have a unique capability that quickly allow the customers to implement on a very seamless way that doesn't cause a lot of kind of stress from their environment and the different capabilities we have I think are quite unique. And that's why we are getting this business.

Thanks.

And the next questioner today will be George Mihalos with Cowen. Please go ahead.

Good morning guys. Todd, I wanted to ask you questions specific to the marketing services line. Typically 4Q going to 1Q on an absolute revenue basis that revenue seems to step down 4Q to 1Q if that didn't happen this time around, I am just curious if you can provide some color on that and then I think on the last call the one area I think you guys talked about a little bit of softness for 18 was credit card, just wondering if you had an update there and if you feel any differently about it.

Hi George. Good morning. Thanks for the question. So marketing services I mean as you noted we had a very strong Q1 and I would characterize it as continued growth that we are seeing first and foremost out of the consumer lending space and we think about – I think about the Fintech players are the big drivers there. Also CreditVision and CreditVision Link and the capabilities there are driving that nice growth rate that we are seeing in marketing services. And I would say that just kind of the traditional marketing and portfolio review business that we do for financial services customer also just continue to be strong. So I think that the net takeaway is I think that consumer lending and CreditVision continue to be strong and that would be the way to kind of think about that credit card. It's a little soft right now from our point of view but it's kind of as expected and as will be talked about during the last call.

And our next questioner today will be Bill Warmington with Wells Fargo. Please go ahead.

Good morning everyone. So I wanted to ask it looks like Callcredit has made some acquisitions as part of its growth back in 2016 Recipero and Numero being a couple so I wanted to ask whether the Callcredit was growing organically above, below, in-line with the 11% market CAGR that you cited for the market?

Yes. So I guess the best way to answer organically that they well outperformed the market. I think that's the best way to answer that question.

Thank you very much.

And the next questioner today will be Shlomo Rosenbaum with Stifel. Please go ahead.

Good morning and thank you for taking my questions. The growth was pretty strong throughout the company. One area where it was just broke trend a little on the downside was, which was on the decisions services was first time we have seen below double digit growth and like five years. Can you talk about some of the items that impacted that maybe there is some timing over there, if there is any changes in the markets that you are addressing?

Good morning Shlomo. I will take that one. So yes you are right. Decision services grew 8% in the quarter as you know that is where we have our healthcare businesses predominately recorded. First, the healthcare business continue to grow at a nice double digit pace, we continue to see great momentum in the back end of the revenue cycle management and in particular with our insurance coverage covered product, that trend continues on and we still feel that there is a quite a bit of runway left with the healthcare business. So what's dragging the number down a little bit is just some underperformance that we have seen predominately in collections and maybe in some of our other, point of service decisioning and the applications are there more legacy type of business, they are kind of flattish right now but when we look forward we fully expect this category to be back add a double digit clip, so when we talk next time that’s what we fully expected to be.

Okay. Thanks.

And this concludes our question-and-answer session. I would like to turn the conference back over to the management team for any closing remarks.

That ends the call today, thank you all very much for joining us and taking the time this morning, have a wonderful day and wonderful weekend.

And the conference has now concluded. Thank you all for attending today's presentation and you may now disconnect your lines.