TransUnion (NYSE: TRU) reported Q2 EPS of $0.62, $0.03 better than the analyst estimate of $0.59. Revenue for the quarter came in at $563 million versus the consensus estimate of $540.02 million.

“TransUnion delivered another strong quarter with double-digit revenue, Adjusted EBITDA and Adjusted EPS growth,” said Jim Peck, President and CEO. “The growth continues to be broad based across our segments and is driven by our successful innovation, unique vertical positions and attractive international businesses.”

“During the quarter, we closed three strategically significant acquisitions in Callcredit, iovation and Healthcare Payment Specialists. Each of these acquisitions provides TransUnion with highly valuable data, capabilities and market scope that will contribute to the continuation of our strong growth track record. As we look ahead, we expect to deliver a strong second half and believe we are well positioned for 2019 and beyond.”

2018 Full Year Outlook

For the full year of 2018, we are raising our Adjusted Revenue, Adjusted EBITDA and Adjusted Diluted Earnings per Share guidance as follows. Adjusted Revenue is expected to be between $2.333 billion and $2.343 billion, an increase of 21 percent compared with 2017. Adjusted EBITDA is expected to be between $904 million and $910 million, an increase of 21 to 22 percent. Adjusted Diluted Earnings per Share is expected to be between $2.42 and $2.44, an increase of 29 to 30 percent. Adjusted Diluted Earnings per Share includes a benefit of approximately $0.28 due to the recently enacted Tax Cuts and Jobs Act. Adjusted Diluted Earnings per Share guidance also includes an approximate $(0.02) headwind from unfavorable foreign exchange rates and an approximate $(0.01) per share headwind from the impact of higher LIBOR rates on the debt existing prior to the incremental financing activities completed in June 2018.

The Adjusted Revenue guidance includes approximately 9 points growth from acquisitions that closed in the prior year and in the second quarter of 2018, as well as approximately 50 basis points of drag on Adjusted Revenue and Adjusted EBITDA from foreign exchange rates. Our guidance also includes approximately $15 million of incremental monitoring revenue due to a breach at a competitor, compared with $4 million in 2017. The expected increase in this incremental revenue represents 0.5 percent of the total growth.

2018 Third Quarter Outlook

For the third quarter of 2018, Adjusted Revenue is expected to be between $610 million and $615 million, an increase of 23 to 24 percent compared with the third quarter of 2017. Adjusted EBITDA is expected to be between $237 million and $240 million, an increase of 22 to 24 percent. Adjusted Diluted Earnings per Share is expected to be between $0.61 and $0.62, an increase of 24 to 26 percent. Adjusted Diluted Earnings per Share includes a benefit of approximately $0.07 due to the recently enacted Tax Cuts and Jobs Act.

The third quarter Adjusted Revenue guidance includes approximately 15 points of growth from acquisitions that closed in the prior year and in the second quarter of 2018. Foreign exchange rates are driving approximately 150 basis points drag on Adjusted Revenue and Adjusted EBITDA. Guidance includes $5 million of incremental monitoring revenue due to a breach at a competitor.

Given the size of the Callcredit acquisition, beginning in the 3rd quarter 2018, we will adjust our Non-GAAP financial measures of Adjusted Operating Income, Adjusted EBITDA, Adjusted Net Income and Adjusted Diluted Earnings per Share to add back costs incurred relating to our integration of Callcredit. We expect to add these costs back to these Non-GAAP performance measures for approximately two years. Additionally, we will disclose the Non-GAAP financial measure of Adjusted Revenue beginning in the 3rd quarter 2018. Adjusted Revenue is intended to reflect what revenue would have been had we not reduced the amount of deferred revenue on the opening balance sheets for recently acquired businesses as a result of applying business combination fair value accounting principles. We expect deferred revenue adjustments for acquisitions that closed in the 2nd quarter of 2018 to primarily last for approximately one year, with the remainder to last up to two years. We believe the best period-over-period comparison of revenue over the next one to two years as we run off this impact will be Adjusted Revenue compared with GAAP revenue, in periods prior to and after this runoff is complete. Further, revenue from certain non-core customer contracts of Callcredit that are not classified as discontinued operations and that are expected to expire within one year will be excluded from Adjusted Revenue. See Non-GAAP Financial Measures below and Schedule 7 for additional information.

GUIDANCE:

TransUnion sees FY2018 EPS of $2.42-$2.44, versus the consensus of $2.40. TransUnion sees FY2018 revenue of $2.333-2.343 million, versus the consensus of $2.18 million.

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