Experian, the newly demerged credit checking company, has marked its first year as an independent business by announcing market-beating profits of $825 million (£417.6 million).

The company, which was spun out of GUS last year, said earnings before interest and tax (Ebit) rose by 11 per cent, surpassing City expectations of $810 million, sending its shares up 1.28 per cent, or 7.5p, to 593p in early trading.

Sales for the 12 months to March 31, 2007, rose by 14 per cent from $3 billion to $3.4 billion.

Despite the strong figures, Experian said it faced a number of challenges in the current financial year, including the impact from deterioration of the US sub-prime lending market and the effect of UK interest rate rises on heavily indebted individuals.

In the US, sales rose by 15 per cent to $1.9 billion, helped by its interactive business growing revenues by 37 per cent to $751 million.

However, Experian admitted it had seen a slowdown in revenues generated from its LowerMyBills website, which is aimed at providing sub-prime mortgages to customers. In the third quarter of the year, sales from LowerMyBills were flat before declining in the fourth quarter by 8 per cent.

Don Robert, Experian's chief executive, said the company had been repositioning LowerMyBills to appeal to prime mortgage lending as well as providing information on customers wishing to take out credit cards. He added: "The sub-prime problems in the US are now working themselves through."

The company is also attempting to reposition its marketing services group, which allows customers to compare their bills. Experian has relied on direct mail to generate revenues in this area but is now investing in new media, allowing consumers to check their payments online.

Experian has around $1.5 billion to spend on acquisitions this year, but Mr Robert declined to comment on whether the company would make a bid for uSwitch, the ubiquitous online payment comparison company, which could speed up remodelling Experian's marketing services group. USwitch was sold last year for £210 million to EW Scripps, the US media group.

Marketing services revenue increased by 31 per cent but organic growth was just 1 per cent.

Experian also said that the demand for providing credit checks for UK customers was "challenging" since fewer people were taking out credit cards as interest rates continue to climb and individuals struggle with high levels of debt.

Over the year, sales in its UK credit services division rose by just 3 per cent. However, softness in this operation was offset by growth from its decision analytics division, which provides tools for companies to detect fraud.

Mr Robert declined to comment on whether the company had been approached by private equity firms interested in making a bid for the group.

Last week, Acxiom, a US rival, was bought out by Valueact Capital, a hedge fund, in a deal worth $3 billion.

Last month, KKR, the US private equity giant, agreed to buy First Data Corporation, a US-based credit card transaction processor, for $29 billion, and a consortium led by Pacific Equity Partners paid $660 million for Veda Advantage, an Australian credit checking agency.

Experian revealed today that its demerger cost $126 million, predominantly in legal and financial advisory fees. Experian will pay a dividend of 11.5 cents per share to give a full year dividend of 17 cents per share.

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