DOW JONES NEWSWIRES 
 

Equifax Inc.'s (EFX) first-quarter net income fell 17%, with the company suffering as its financial-services customers struggle against the credit crisis and recession.

Equifax, one of the three major U.S. credit-reporting bureaus, has been reallocating resources to chase revenue in a tough environment. For instance the company's new settlement services business quadrupled its revenue last year, offsetting big declines in the core mortgage-reporting business.

"First-quarter results were solid in a very difficult environment," said Richard F. Smith, Equifax's chairman and chief executive. "As our senior executives continue to be deeply involved with our larger customers, it is clear that the current environment is significantly impacting customers' long-term business strategies."

Last week, rival Experian PLC (EXPGY) said it remain cautious in its outlook despite some signs the financial sector is stabilizing.

Equifax reported net income of $56.1 million, or 43 cents a share, down from $67.4 million, or 50 cents a share, a year earlier. Excluding acquisition- and restructuring-related charges, earnings fell to 58 cents from 60 cents.

Revenue dropped 10% to $452.9 million, with more than half the decline due to the stronger dollar.

In February, the company said it expected adjusted earnings of 52 cents to 57 cents a share, below Wall Street expectations at the time, with revenue similar to the $446.6 million posted for the fourth quarter.

Operating margins fell to 22.7% from 25.1%, largely on restructuring charges.

The U.S. consumer information solutions segment, which typically accounts for half of Equifax's revenue, posted a 10% decrease. Revenue at the Talx unit, which verifies borrower information for mortgage lenders and provides human-resources services, rose 10%. Equifax bought the company for $1.4 billion in 2007.

Total international revenue fell 22%, but only 2% in local currencies.

For the second quarter, Equifax expects adjusted earnings of 55 cents to 60 cents a share on revenue roughly the same or up slightly from the first quarter. Analysts expect earnings of 57 cents a share on revenue of $449.2 million.

Equifax shares were inactive after-hours; the stock closed at $26.36.

-By Jay Miller, Dow Jones Newswires; 201-938-2331; jay.miller@dowjones.com