FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended JUNE 30, 1999
-----------------------------

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from _____________ to ____________

Commission File Number: 001-13069

CHOICEPOINT INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

Georgia 58-2309650
(State or other jurisdiction of incorporation (I.R.S. Employer
- ------------------------------------------------ ------------------------------
or organization) Identification No.)

1000 Alderman Drive Alpharetta, Georgia 30005
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)

(770) 752-6000
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)

- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

Class Outstanding at July 31, 1999
----- ----------------------------
Common Stock, $.10 Par Value 14,732,916

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CHOICEPOINT INC.
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
INDEX

Part I. FINANCIAL INFORMATION Page No.
--------

Item 1. Financial Statements

Consolidated Statements of Income -
Three Months Ended June 30, 1999 and 1998 and 3 Six Months Ended June 30,
1999 and 1998 3

Consolidated Balance Sheets -
June 30, 1999 and December 31, 1998 4

Consolidated Statement of Shareholders' Equity -
Six Months Ended June 30, 1999 5

Consolidated Statements of Cash Flows -
Six Months Ended June 30, 1999 and 1998 6

Notes to Consolidated Financial Statements 7

Item 2. Management's Discussion and Analysis
of Results of Operations and Financial Condition 11

Item 3. Quantitative and Qualitative Disclosures about Market Risk 16

Part II. OTHER INFORMATION

Item 1. Legal Proceedings 17

Item 2. Changes in Securities and Use of Proceeds 17

Item 3. Defaults Upon Senior Securities 17

Item 4. Submission of Matters to a Vote of Security Holders 17

Item 5. Other Information 18

Item 6. Exhibits and Reports on Form 8-K 18

Signatures 19

Exhibit Index 20

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CHOICEPOINT INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)

THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
(IN THOUSANDS, EXCEPT PER SHARE DATA) 1999 1998 1999 1998
-------- -------- -------- --------

Operating revenue ............................... $107,979 $106,702 $207,663 $201,252
Costs and expenses:
Costs of services ............................. 66,341 73,295 130,911 132,919
Selling, general, and administrative .......... 22,502 16,923 40,196 36,839
Unusual items ................................. -- -- 1,583 --
-------- -------- -------- --------
Total costs and expenses .................. 88,843 90,218 172,690 169,758

Operating income ................................ 19,136 16,484 34,973 31,494
Gain on sale of businesses, net ................. -- -- 2,513 --
Interest expense ................................ 2,913 1,825 5,469 3,470
-------- -------- -------- --------

Income before income taxes ...................... 16,223 14,659 32,017 28,024
Provision for income taxes ...................... 7,019 6,347 13,858 12,134
-------- -------- -------- --------

Net income ...................................... $ 9,204 $ 8,312 $ 18,159 $ 15,890
======== ======== ======== ========

Earnings per share - basic ...................... $ .64 $ .57 $ 1.26 $ 1.09
======== ======== ======== ========
Weighted average shares - basic ............... 14,476 14,611 14,457 14,626
======== ======== ======== ========

Earnings per share - diluted .................... $ .61 $ .55 $ 1.21 $ 1.05
======== ======== ======== ========
Weighted average shares - diluted ............. 15,059 15,162 14,975 15,129
======== ======== ======== ========

The accompanying notes are an integral part of these
consolidated statements.

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CHOICEPOINT INC.
CONSOLIDATED BALANCE SHEETS

JUNE 30, DECEMBER 31,
(IN THOUSANDS, EXCEPT PAR VALUES) 1999 1998
--------- ------------
(UNAUDITED)

ASSETS
Current assets:
Cash and cash equivalents ............................................... $ 15,132 $ 18,883
Marketable securities ................................................... -- --
Accounts receivable, net of allowance for doubtful accounts
of $3,700 at June 30, 1999 and $3,286 at December 31,1998 ............. 111,384 103,191
Deferred income tax assets .............................................. 8,435 8,372
Other current assets .................................................... 10,972 13,160
--------- ---------
Total current assets ................................................ 145,923 143,606

Property and equipment, net ............................................... 51,498 55,279
Goodwill, net ............................................................. 254,739 253,140
Deferred income tax assets ................................................ 18,639 19,010
Other ..................................................................... 48,494 63,164
--------- ---------

Total Assets .............................................................. $ 519,293 $ 534,199
========= =========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt and current maturities of long-term debt ................ $ 926 $ 5,623
Notes payable for acquisitions .......................................... -- 22,701
Accounts payable ........................................................ 27,829 24,645
Accrued salaries and bonuses ............................................ 13,048 17,537
Other current liabilities ............................................... 42,541 54,454
--------- ---------
Total current liabilities ............................................. 84,344 124,960

Long-term debt, less current maturities ................................... 201,569 191,697
Postretirement benefit obligations ........................................ 51,913 53,251
Other long-term liabilities ............................................... 5,076 4,719
--------- ---------
Total liabilities ..................................................... 342,902 374,627
--------- ---------

Shareholders' equity:
Preferred stock, $.01 par value; shares
authorized - 10,000; no shares issued or outstanding ................. -- --
Common stock, $.10 par value; shares authorized -
100,000; shares issued and outstanding -
14,726 in 1999 and 14,660 in 1998 ..................................... 1,473 1,466
Paid-in capital ......................................................... 119,384 119,037
Retained earnings ....................................................... 67,322 49,163
Foreign currency translation adjustments ................................ (370) (176)
Stock held by employee benefit trusts, at cost,
234 shares in 1999 and 203 shares in 1998 ............................ (11,418) (9,918)
--------- ---------

Total shareholders' equity ............................................ 176,391 159,572
--------- ---------

Total Liabilities and Shareholders' Equity ................................ $ 519,293 $ 534,199
========= =========

The accompanying notes are an integral part of these
consolidated balance sheets.

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CHOICEPOINT INC.
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(UNAUDITED)

CUMULATIVE STOCK HELD
(IN THOUSANDS) COMPREHENSIVE COMMON PAID-IN RETAINED TRANSLATION BY BENEFIT
INCOME STOCK CAPITAL EARNINGS ADJUSTMENTS TRUSTS TOTAL
------------- ------- --------- -------- ----------- ---------- ---------

Balance December 31, 1998 ... $ 1,466 $ 119,037 $ 49,163 $ (176) $ (9,918) $ 159,572
119,037
Net income ................ $ 18,159 -- -- 18,159 -- -- 18,159
Restricted stock plans, net -- 3 (849) -- -- -- (846)
Stock options exercised ... -- 4 1,196 -- -- -- 1,200
Cost of shares repurchased -- -- -- -- -- (1,500) (1,500)
Translation adjustments ... (194) -- -- -- (194) -- (194)
-------- ------- --------- -------- ------- --------- ---------
Comprehensive income ........ $ 17,965
========

Balance June 30, 1999 ....... $ 1,473 $ 119,384 $ 67,322 $ (370) $ (11,418) $ 176,391
======= ========= ======== ======= ========= =========

The accompanying notes are an integral part of this
consolidated statement.

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CHOICEPOINT INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

SIX MONTHS ENDED
JUNE 30,
-----------------------
1999 1998
-------- --------
(IN THOUSANDS)

Cash flows from operating activities:
Net income ............................................................... $ 18,159 $ 15,890
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization .......................................... 19,382 14,281
Provision for unusual items ............................................ 1,583 --
Gain on sale of businesses ............................................. (2,513) --
Compensation recognized under employee stock plans ..................... 1,610 1,116
Payment on employee stock plans ........................................ (3,378) --
Changes in assets and liabilities, excluding effects of acquisitions and
divestiture:
Accounts receivable, net ............................................. (7,198) 242
Other current assets ................................................. 1,790 414
Current liabilities, excluding debt .................................. (13,762) (4,186)
Deferred income taxes ................................................ 308 (1,904)
Other long-term liabilities, excluding debt .......................... (980) 503
-------- --------

Net cash provided by operating activities ................................ 15,001 26,356
-------- --------

Cash flows from investing activities:
Acquisitions, net of cash acquired ....................................... (8,010) (40,292)
Payment of notes payable for acquisitions ................................ (22,701) --
Cash proceeds from sale of business unit ................................. 22,000 --
Additions to property and equipment ...................................... (5,845) (7,037)
Additions to other assets, net ........................................... (8,833) (7,986)
-------- --------

Net cash flows used by investing activities .............................. (23,389) (55,315)
-------- --------

Cash flows from financing activities:
Proceeds from long-term debt ............................................. 30,000 25,042
Payments on long-term debt ............................................... (20,128) (21,213)
Net short-term borrowings ................................................ (4,696) 11,660
Purchases of stock held by employee benefit trusts ....................... (1,500) (4,702)
Proceeds from exercise of stock options .................................. 1,200 250
-------- --------
Net cash flows provided by financing activities .......................... 4,876 11,037
-------- --------
Effect of foreign currency exchange rates on cash .......................... (239) 54
-------- --------

Net decrease in cash ....................................................... (3,751) (17,868)
Cash and cash equivalents, beginning of period ............................. 18,883 26,858
-------- --------
Cash and cash equivalents, end of period ................................... $ 15,132 $ 8,990
======== ========

The accompanying notes are an integral part of these
consolidated statements.

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CHOICEPOINT INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1999
(UNAUDITED)

1. ORGANIZATION

ChoicePoint Inc., a Georgia corporation ("ChoicePoint" or the "Company"), is a
provider of actionable intelligence that helps businesses, governments and
individuals make better, more timely and more informed business decisions.
ChoicePoint's businesses are focused on two primary markets - Insurance
Services and Business and Government Services.

The Insurance Services group provides information products and
services used in the underwriting, claims, and marketing processes by
property and casualty and life insurers. Major offerings to the
personal lines property and casualty market include claims history
databases, motor vehicle records, credit information, and modeling
services. Additionally, ChoicePoint provides customized policy rating
and issuance software and property inspections and audits to the
commercial insurance market, and laboratory testing services and
related technology solutions to the life and health insurance market.

The Business and Government Services group provides direct marketing
and information products and services to Fortune 1000 corporations,
consumer finance companies, asset-based lenders, legal and
professional service providers, health care service providers and
federal, state and local government agencies. Major offerings include
pre-employment background and drug screenings, public record searches,
credential verification, due diligence information, uniform commercial
code searches and filings, and people and shareholder locator
searches.

2. BASIS OF PRESENTATION

The consolidated financial statements include the accounts of ChoicePoint Inc.
and its wholly-owned subsidiaries. All material transactions between entities
included in the consolidated financial statements have been eliminated. The
consolidated financial statements have been prepared on the historical cost
basis, and reflect all adjustments which are, in the opinion of management,
necessary for a fair statement of the financial position of ChoicePoint as of
June 30, 1999 and the results of operations and cash flows for the three months
and six months ended June 30, 1999 and 1998. The adjustments have been of a
normal recurring nature. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. These financial
statements should be read in conjunction with the notes to the financial
statements included in ChoicePoint's Consolidated Financial Statements for the
year ended December 31, 1998 as filed with the Securities and Exchange
Commission in the Annual Report on Form 10-K (File No. 1-13069). The current
period's results are not necessarily indicative of results to be expected for a
full year.

3. USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions.
These estimates and assumptions affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements as well as reported amounts of revenues and expenses
during the reporting period. Actual results could differ from these estimates.

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4. REVENUE AND COSTS OF SERVICES PRESENTATION

Motor vehicle records registry revenue, the fee charged by states for motor
vehicle records which is passed on by ChoicePoint to its customers, is excluded
from revenue and is recorded as a reduction to cost of services in the
consolidated financial statements. Registry revenue was $89,836,000 and
$74,377,000 for the three months ended June 30, 1999 and 1998, respectively,
and $177,296,000 and $142,949,000 for the six months ended June 30, 1999 and
1998, respectively.

ChoicePoint Direct Inc., formally Customer Development Corporation, a business
acquired in the fourth quarter of 1998, passes on material, shipping and
postage charges to their customers. These charges are excluded from revenue and
are recorded as a reduction to cost of services in the consolidated financial
statements. Charges passed through to customers for the three months and six
months ended June 30, 1999 were $9,340,000 and $19,213,000, respectively.

5. EARNINGS PER SHARE

The net income amount used in the numerator of the Company's earnings per share
calculations is the same for both basic and diluted earnings per share. The
average outstanding shares used in the denominator of the calculation for
earnings per share - diluted includes the dilutive effect of stock options.

6. DEBT

In August 1997, ChoicePoint entered into a $250 million unsecured revolving
credit facility (the "Credit Facility") with a group of banks. The Credit
Facility bears interest at variable rates and is expandable to $300 million,
subject to approval of the lenders. The commitment termination date and final
maturity of the Credit Facility will occur in August 2002. Total borrowings
under the Credit Facility were $199,000,000 at June 30, 1999. In addition,
there was $2,981,000 of other long-term debt outstanding and $514,000 of
short-term debt outstanding as of June 30, 1999.

7. STOCK OPTIONS

During the first quarter of 1999, stock options to purchase approximately
644,000 shares of ChoicePoint common stock were granted at fair market value
under the ChoicePoint Inc. 1997 Omnibus Stock Incentive Plan.

8. ACQUISITIONS

During the second quarter of 1999, the Company acquired Washington Document
Service, Inc., a leading nationwide court document research and retrieval
company. In addition, the Company made additional minority equity investments
in Intertech Information Management Inc., a provider of document management and
imaging services. The total purchase price of the acquisition, which was
accounted for as a purchase, and the equity investment was approximately
$7,241,000, with approximately $5,500,000 of that amount allocated to goodwill.

Subsequent to June 30, 1999, the Company announced the acquisition of Data
Tracks Technology, Inc., d/b/a Public Records On Line, a privately-held online
public record information company, and the assets of its affiliates.

9. GAIN ON SALE OF BUSINESSES

In December 1998, the Company sold its life and health insurance field
underwriting services and insurance claims investigation services to PMSI
Services, Inc. and recorded a gain on the sale. The proceeds from the sale
included $12.0 million in warrants and $10.0 million in a note receivable. The
warrants were discounted by $4.6 million at December 31, 1998. In March 1999,
ChoicePoint received

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$22.0 million plus interest from PMSI Services, Inc. for the prepayment of the
note receivable and the repurchase of the warrants. As a result, ChoicePoint
recognized an additional net pretax gain on the sale of $2.5 million. The net
pretax gain includes the unamortized discount of $4.3 million less
transaction-related costs including lease termination, additional asset
write-offs and personnel-related costs of $1.8 million.

In December 1998, the net pretax gain was also net of transaction-related
costs, including lease termination and personnel-related costs of $5.9 million
that were accrued at the time of the divestiture. As of June 30, 1999,
approximately $2.1 million has been charged against the total $7.7 million
accrued transaction-related costs.

10. UNUSUAL ITEMS

Operating income for the first quarter of 1999 includes $1.6 million of unusual
expense items. The unusual expense items relate primarily to asset impairments
($732,000), severance costs ($451,000) and other one-time costs ($400,000).

11. SEGMENT DISCLOSURES

As a result of the recent divestitures of certain field businesses in December
1998 (Note 9) and changes in the Company's internal organization structure,
ChoicePoint now operates in two reportable segments: Insurance Services
("Insurance") and Business and Government Services ("B&G"). See Note 1 for a
description of each segment. Revenues and operating income for the three months
and six months ended June 30, 1999 and 1998 were as follows:

Three months ended Three months ended
(In Thousands) June 30, 1999 June 30, 1998
---------------------------------------- ---------------------------------------
Operating Operating
Income before Income before
Operating Acquisition Operating Acquisition
Revenue Income Amortization Revenue Income Amortization
-------- --------- ------------- -------- --------- -------------

Insurance $ 65,296 $ 24,797 $ 25,562 $ 67,157 $ 21,532 $ 22,213
B&G 42,602 4,097 7,130 25,009 2,236 4,276
Divested & Discontinued 81 (66) (66) 14,536 556 556
Corporate -- (9,692) (9,692) -- (7,840) (7,840)
-------- -------- -------- -------- -------- --------
Total $107,979 $ 19,136 $ 22,934 $106,702 $ 16,484 $ 19,205
======== ======== ======== ======== ======== ========

Six months ended Six months ended
(In Thousands) June 30, 1999 June 30, 1998
---------------------------------------- ---------------------------------------
Operating Operating
Income before Income before
Operating Acquisition Operating Acquisition
Revenue Income Amortization Revenue Income Amortization
-------- --------- ------------- -------- --------- -------------

Insurance $128,614 $ 46,349 $ 47,879 $125,431 $ 41,902 $ 43,264
B&G 78,815 5,581 11,611 46,687 2,226 6,096
Divested & Discontinued 234 (32) (32) 29,134 174 174
Corporate -- (15,342) (15,342) -- (12,808) (12,808)
Unusual items (Note 10) -- (1,583) (1,583) -- -- --
-------- -------- -------- -------- -------- --------
Total $207,663 $ 34,973 $ 42,533 $201,252 $ 31,494 $ 36,726
======== ======== ======== ======== ======== ========

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Corporate expenses represent costs of support functions, incentives and profit
sharing that benefit both segments. Acquisition amortization includes goodwill
and other intangible amortization related to acquisitions.

Total depreciation and amortization for the three months and six months ended
June 30, 1999 and 1998 were as follows:

Three Months Ended Six Months Ended
June 30, June 30,
(In Thousands) 1999 1998 1999 1998
------ ------ ------- -------

Insurance $4,034 $3,281 $ 8,007 $ 6,557
B&G 4,951 3,318 10,194 6,399
Divested & Discontinued 12 198 43 412
Corporate 601 490 1,138 913
------ ------ ------- -------
Total $9,598 $7,287 $19,382 $14,281
====== ====== ======= =======

ChoicePoint's balance sheets are generally managed on a consolidated basis and
therefore it is impracticable to report assets by segment. Substantially all of
the Company's operations are located in the United States and no customer
represents more than 10% of total operating revenue.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION

INTRODUCTION

ChoicePoint Inc., a Georgia corporation ("ChoicePoint" or the "Company") is a
provider of actionable intelligence that helps businesses, governments and
individuals make better, more timely and more informed business decisions.
ChoicePoint's businesses are focused on two primary markets - Insurance
Services and Business and Government Services. See Note 1 to the consolidated
financial statements for a description of each market.

THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THREE MONTHS ENDED JUNE 30, 1998

Consolidated revenue increased $1.3 million, or 1.2%, to $108.0 million for the
three months ended June 30, 1999 from $106.7 million for the three months ended
June 30, 1998. Excluding the effect of the sale of certain field businesses in
December 1998, consolidated revenues increased $15.7 million, or 17.1%, to
$107.9 million for the three months ended June 30, 1999 from $92.2 million for
the three months ended June 30, 1998 primarily as a result of strong revenue
performance in automated products and in new acquisitions. Consolidated
operating income increased $2.7 million, or 16.1%, to $19.1 million for the
three months ended June 30, 1999 from $16.5 million for the three months ended
June 30, 1998. Operating margins increased to 17.7% for the three months ended
June 30, 1999 from 15.4% for the three months ended June 30, 1998.

Revenue from Insurance Services, excluding the effect of the sale of the field
businesses noted above and an $8.2 million progress payment on a significant
systems development project in the second quarter of 1998, grew $6.3 million,
or 10.8%, to $65.3 million for the three months ended June 30, 1999 from $59.0
million for the three months ended June 30, 1998, driven by strong unit
performance in personal lines products and laboratory services. Operating
income increased $3.3 million, or 15.2%, to $24.8 million for the three months
ended June 30, 1999 from $21.5 million for the three months ended June 30,
1998, primarily as a result of revenue growth noted above. Acquisition
amortization, which includes goodwill and other intangible amortization related
to acquisitions, increased to $765,000 for the three months ended June 30, 1999
from $681,000 for the three months ended June 30, 1998 due to an acquisition
made in 1998. Excluding acquisition amortization, the operating margin in
Insurance Services for the second quarter of 1999 was 39.1%.

Revenue from Business and Government Services, excluding the effect of the sale
of its payroll verification business and other discontinued product lines,
increased $17.6 million, or 70.3%, to $42.6 million for the three months ended
June 30, 1999 from $25.0 million for the three months ended June 30, 1998.
Comparable internal revenue growth for Business and Government Services,
excluding the effect of revenue from acquisitions made since the first quarter
of 1998, was 6.9% over prior year. Operating income increased $1.9 million to
$4.1 million for the three months ended June 30, 1999 from $2.2 million for the
three months ended June 30, 1998, primarily as a result of new acquisitions.
Acquisition amortization, which includes goodwill and other intangible
amortization related to acquisitions, increased to $3.0 million for the three
months ended June 30, 1999 from $2.0 million for the three months ended June
30, 1998 due to acquisitions made in 1998. Excluding acquisition amortization,
the operating margin in Business and Government Services for the second quarter
of 1999 was 16.7%.

Divested and discontinued operations include the operating results from the
field businesses sold in December 1998, the payroll verification business sold
in May of 1999, the discontinued medical device registry business and from the
shutdown of certain remaining business and government field offices where
revenue did not justify sustained physical presence.

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Corporate expenses represent costs of support functions, incentives and profit
sharing that benefit both segments. The increase to $9.7 million for the three
months ended June 30, 1999 from $7.8 million for the three months ended June
30, 1998 is primarily due to the increase in compensation expense recognized
under employee stock plans and in incentives.

Consolidated operating income increased $2.7 million, or 16.1%, to $19.1
million for the three months ended June 30, 1999 from $16.5 million for the
three months ended June 30, 1998. Included in operating results for the three
months ended June 30, 1999 and 1998 were $2.2 million and $0.8 million,
respectively, of expenses incurred to modify existing computer systems and
applications to address the Year 2000 compliance issues.

Interest expense was $2.9 million and $1.8 million for the three months ended
June 30, 1999 and 1998, respectively.

Net income increased $0.9 million, or 10.7%, to $9.2 million for the three
months ended June 30, 1999 from $8.3 million for the three months ended June
30, 1998. The effective tax rate remained unchanged at 43.3%.

SIX MONTHS ENDED JUNE 30, 1999 COMPARED TO SIX MONTHS ENDED JUNE 30, 1998

Consolidated revenue increased $6.4 million, or 3.2%, to $207.7 million for the
six months ended June 30, 1999 from $201.3 million for the six months ended
June 30, 1998. Excluding the effect of the sale of certain field businesses in
December 1998, consolidated revenues increased $35.3 million, or 20.5%, to
$207.4 million for the six months ended June 30, 1999 from $172.1 million for
the six months ended June 30, 1998, primarily as a result of strong revenue
performance in automated products and in new acquisitions. Consolidated
operating income before unusual items increased $5.1 million, or 16.1%, to
$36.6 million for the six months ended June 30, 1999 from $31.5 million for the
six months ended June 30, 1998. Operating margins (excluding the effects of
unusual items) increased to 17.6% for the six months ended June 30, 1999 from
15.6% for the six months ended June 30, 1998.

Revenue from Insurance Services, excluding the effect of the sale of the field
businesses noted above and an $8.2 million progress payment on a significant
systems development project in the second quarter of 1998, grew $11.4 million,
or 9.7%, to $128.6 million for the six months ended June 30, 1999 from $117.2
million for the six months ended June 30, 1998, driven by strong unit
performance in personal lines products and laboratory services. Operating
income increased $4.4 million, or 10.6%, to $46.3 million for the six months
ended June 30, 1999 from $41.9 million for the six months ended June 30, 1998,
primarily as a result of strong revenue growth noted above. Acquisition
amortization, which includes goodwill and other intangible amortization related
to acquisitions, increased to $1.5 million for the six months ended June 30,
1999 from $1.4 million for the six months ended June 30, 1998 due to
acquisitions made in 1998. Excluding acquisition amortization, the operating
margin in Insurance Services for the first six months of 1999 was 37.2%.

Revenue from Business and Government Services, excluding the effect of the sale
of its payroll verification business and other discontinued product lines,
increased $32.1 million, or 68.8%, to $78.8 million for the six months ended
June 30, 1999 from $46.7 million for the six months ended June 30, 1998.
Comparable internal revenue growth for Business and Government Services,
excluding the effect of revenue from acquisitions made since the first quarter
of 1998, was 5.6% over prior year. Operating income increased $3.4 million to
$5.6 million for the six months ended June 30, 1999 from $2.2 million for the
six months ended June 30, 1998, primarily as a result of new acquisitions.
Acquisition amortization, which includes goodwill and other intangible
amortization related to acquisitions, increased to $6.0 million for the six
months ended June 30, 1999 from $3.9 million for the six months ended June 30,
1998 due to acquisitions made since the first quarter of 1998. Excluding
acquisition amortization, the operating margin in Business and Government
Services for the first six months of 1999 was 14.7%.

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Corporate expenses represent costs of support functions, incentives and profit
sharing that benefit both segments. The increase to $15.3 million for the six
months ended June 30, 1999 from $12.8 million for the six months ended June 30,
1998 is primarily due to the increase in incentives.

Unusual items of $1.6 million in the first quarter of 1999 relate primarily to
asset impairments ($732,000), severance costs ($451,000) and other one-time
costs ($400,000).

In the first quarter of 1999, an additional gain on the sale of certain field
businesses of $2.5 million was recorded in connection with the prepayment of a
note receivable and the repurchase of warrants issued by PMSI Services, Inc. in
the transaction. See Note 9 to the consolidated financial statements.

Consolidated operating income after unusual items increased $3.5 million, or
11.0%, to $35.0 million for the six months ended June 30, 1999 from $31.5
million for the six months ended June 30, 1998. Before unusual items, operating
income increased 16.1%. Included in operating results for the six months ended
June 30, 1999 and 1998 were $4.3 million and $1.5 million, respectively, of
expenses incurred to modify existing computer systems and applications to
address the Year 2000 compliance issues.

Interest expense was $5.5 million and $3.5 million for the six months ended
June 30, 1999 and 1998, respectively. Interest expense for the first quarter of
1999 is net of $431,000 of interest income from the PMSI Services, Inc. note
receivable and warrants prior to the prepayment and repurchase made in March
1999.

Net income increased $2.3 million, or 14.3%, to $18.2 million for the six
months ended June 30, 1999 from $15.9 million for the six months ended June 30,
1998. The effective tax rate remained unchanged at 43.3%.

FINANCIAL CONDITION AND LIQUIDITY

Cash provided by operations was $15.0 million in the first six months of 1999
as increased net income and depreciation and amortization were offset by
reductions in current liabilities and an increase in accounts receivable.
During the first six months of 1998, cash provided by operations was $26.4
million. During the first six months of 1999, ChoicePoint used $23.4 million
for investing activities, primarily comprised of $8.0 million for acquisitions,
$5.8 million for additions to property and equipment and $8.8 million for
additions to other assets. Additions to property and equipment were primarily
system upgrades while additions to other assets were primarily software,
purchased data files, and software developed for external use. During the first
six months of 1998, ChoicePoint used $55.3 million for investing activities,
primarily for the acquisition of the remaining 27.4% interest in CDB Infotek,
other acquisitions, and for additions to property and equipment and other
assets. Net cash provided by financing activities was $4.9 million in the first
six months of 1999, as the $9.9 million net increase in long-term debt was used
to paydown $4.7 million in short-term borrowings. During the first six months
of 1998, net cash provided by financing activities was $11.1 million, as the
proceeds from a credit facility and two lines of credit were used to fund
acquisitions.

Earnings before interest, taxes, depreciation and amortization ("EBITDA")
increased $11.1 million, or 24.2%, to $56.9 million for the six months ended
June 30, 1999 from $45.8 million for the six months ended June 30, 1998. The
Company has included EBITDA data (which is not a measure of financial
performance under generally accepted accounting principles) because such data
is used by certain investors to analyze and compare companies on the basis of
operating performance, leverage and liquidity, and to

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determine a company's ability to service debt. EBITDA is not presented as a
substitute for income from operations, net income or cash flows from operating
activities.

The Company's short-term and long-term liquidity depends primarily upon its
level of net income, accounts receivable, accounts payable and accrued
expenses. In order to meet its working capital needs, ChoicePoint entered into
a five-year, $250 million revolving credit facility ("Credit Facility") with a
group of banks in August 1997. The Credit Facility bears interest at variable
rates and is expandable to $300 million, subject to approval of the lenders.
During the first six months of 1999, ChoicePoint used borrowings under the
Credit Facility for payment of short-term borrowings and for acquisitions.
Total debt outstanding under the Credit Facility was $199.0 million at June 30,
1999 and $189.0 million at December 31, 1998. ChoicePoint may use additional
borrowings under the Credit Facility to finance acquisitions and for general
corporate cash requirements.

No cash dividends have been paid and the Company does not anticipate paying any
cash dividends on its common stock in the near future.

YEAR 2000

The term "Year 2000 compliance issue" is a general term used to describe the
various problems that may result from the improper processing of dates and
date-sensitive calculations by computers and other machinery as the year 2000
approaches. The Year 2000 compliance issue exists because many currently
installed computer systems and software products are coded to accept only two
digit entries in the date code field. In order to distinguish 21st century
dates from 20th century dates, these date code fields must be able to interpret
four digit entries.

The Company's State of Readiness - ChoicePoint has established a central Year
2000 department to coordinate and report, on a continuing basis, with regard to
the assessment, remediation planning, implementation, and contingency planning
processes directed toward addressing the Company's Year 2000 compliance issues.

ChoicePoint is engaged in a continuous process of assessing the impact of the
Year 2000 compliance issue on its reporting systems and operations. As part of
that process, certain computer systems and software programs used, and in some
cases developed, by ChoicePoint required upgrading in order to address Year
2000 requirements. The Company has assessed its noninformation technology
systems, which includes systems that contain embedded technology. However, the
Company has determined that these systems present less of a risk to the
Company's operations.

ChoicePoint is also continuing to supply and receive data and inquiries from
its vendors and customers. Current remediation efforts are in place to accept
and transmit data in both 2-digit and 4-digit formats within applicable
ChoicePoint applications.

ChoicePoint uses the Gartner Group's COMpliance Progress And REadiness
(COMPARE) Scale to measure its progress in addressing the Year 2000 compliance
issue. The COMPARE scale has five levels:

Level One - PRELIMINARY ACTIVITY (problem not determined and risk is
high)

Level Two - PROBLEM DETERMINATION (IT and non-IT inventories
completed, risk levels understood)

Level Three - PLAN COMPLETE/RESOURCES COMMITTED (estimated costs have
been determined, required resources have been committed, initial
project plans complete)

Level Four - OPERATIONAL SUSTAINABILITY (systems and key partners are
compliant and certified)

Level Five - FULLY COMPLIANT (all systems are compliant and the Year
2000 threat has been completely neutralized throughout the business
process chain)

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At a minimum, all significant ChoicePoint applications have achieved level
three and the majority of them have reached level four. Final integration
testing is scheduled for completion by the end of the third quarter of 1999.

The Costs to Address the Company's Year 2000 Compliance Issues - During the
first six months of 1999, the Company incurred approximately $4.3 million to
modify existing computer systems and applications to address the Year 2000
compliance issue and estimates total 1999 expenditures to be approximately $7.0
to $8.0 million. The Company has funded and expects to continue to fund, the
costs of Year 2000 assessment and remediation from available cash flows.

The Risks of the Company's Year 2000 Compliance Issues - ChoicePoint is
continuously identifying Year 2000 risks and developing contingency plans to
address these risks as they are identified. If the Company's remediation plan
is not successful, there would be a significant disruption of the Company's
ability to transact business with its major customers and suppliers which could
have a material adverse effect on the Company's financial position and results
of operations. The Company has begun the systems integration testing phase of
its Year 2000 initiative. Until system integration testing is complete, the
Company cannot completely determine the success of its remediation plan.
However, ChoicePoint believes it is devoting the resources necessary to achieve
a level of readiness that will meet its Year 2000 challenges in a timely
manner. ChoicePoint believes the assessment, remediation planning, and plan
implementation processes will be effective to achieve Year 2000 readiness.

The Company's Contingency Plans - The Company is continuing to develop
contingency plans as business risks are identified to help mitigate the risk of
a disruption in operations resulting from a Year 2000-related event. The
Company will continuously reassess Year 2000 risks and develop contingency
plans for worst case scenarios for which there is a reasonable likelihood.

NEW ACCOUNTING PRONOUNCEMENT

In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133 ("SFAS No. 133" or the "Statement"),
"Accounting for Derivative Instruments and Hedging Activities". SFAS No. 133
establishes accounting and reporting standards requiring that every derivative
instrument (including certain derivative instruments embedded in other
contracts) be recorded in the balance sheet as either an asset or liability
measured at its fair value. The statement requires that changes in the
derivative's fair value be recognized currently in earnings unless specific
hedge accounting criteria are met. Special accounting for qualifying hedges
allows a derivative's gains and losses to offset related results on the hedged
item in the income statement, and requires that a company must formally
document, designate, and assess the effectiveness of the transactions that
receive hedge accounting.

SFAS No. 133 is effective for fiscal years beginning after June 15, 2000. A
company may also implement the Statement as of the beginning of any fiscal
quarter after issuance.

The Company has not yet quantified the impact of adopting SFAS No. 133 on it's
financial statements and has not determined the timing of or method of it's
adoption of the Statement. The adoption of SFAS No. 133 is not expected to have
a material impact on earnings or other comprehensive income. However, changes
in the Company's derivative instruments and hedging activities could increase
volatility in earnings and other comprehensive income.

FORWARD-LOOKING STATEMENTS

This report may contain certain information that constitutes forward-looking
statements as that term is defined in the Private Securities Litigation Reform
Act of 1995. Those statements, to the extent they are not historical facts,
should be considered forward-looking and subject to various risks and
uncertainties. Such forward-looking statements are made based upon management's
assessments of various risks and uncertainties, as well as assumptions made in
accordance with the "safe harbor" provisions of the Private

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Securities Litigation Reform Act of 1995. The Company's actual results could
differ materially from the results anticipated in these forward-looking
statements as a result of such risks and uncertainties, including those
identified in the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1998 and the other filings made by the Company from time to
time with the Securities and Exchange Commission. The Company undertakes no
obligation to publicly release any revisions to any forward-looking statement
contained herein to reflect events or circumstances occurring after the date
hereof or to reflect the occurrence of unanticipated events.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to market risk from changes in interest rates. The
information below summarizes the Company's market risk associated with its debt
obligations as of June 30, 1999. The information below should be read in
conjunction with Note 6 of the "Notes to Consolidated Financial Statements".

As of June 30, 1999, $199.0 million was outstanding under the Credit Facility.
The Company has also entered into six interest rate swap agreements (the "Swap
Agreements") to reduce the impact of changes in interest rates on its floating
rate obligation. The Swap Agreements have a combined notional amount of $175.0
million at June 30, 1999 and mature at various dates from 2000 to 2007. The
Swap Agreements involve the exchange of variable rate for fixed rate payments
and effectively change the Company's interest rate exposure to a weighted
average fixed rate of 5.43% plus a credit spread.

Based on the Company's overall interest rate exposure at June 30, 1999, a
near-term change in interest rates would not materially affect the consolidated
financial position, results of operations or cash flows of the Company.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

ChoicePoint is involved in litigation from time to time in the ordinary course
of its business. The Company does not believe that the outcome of any pending
or threatened litigation will have a material adverse effect on the financial
position or results of operations of ChoicePoint. However, as is inherent in
legal proceedings where issues may be decided by finders of fact, there is a
risk that unpredictable decisions adverse to the Company could be reached.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

Not Applicable.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not Applicable.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On May 4, 1999 the Company held its regular Annual Meeting of Shareholders. The
following matters were submitted to a vote of security holders:

(a) Votes cast for or withheld regarding the re-election of two
Directors for terms expiring in 2002:

FOR WITHHELD

Ron D. Barbaro 11,609,174 59,126
Tinsley H. Irvin 11,611,167 57,133

Directors whose terms of office continue after the meeting
are as follows:

Terms Expiring in 2000 Terms Expiring in 2001
James M. Denny Ned C. Lautenbach
Julia B. North C.B. Rogers, Jr.
Charles I. Story Derek. V. Smith

(b) Ratification of the ChoicePoint Inc. 1997 Omnibus Stock Incentive
Plan:

FOR WITHHELD ABSTAIN

8,396,236 3,188,687 83,377

(c) Ratification of the appointment of Arthur Andersen LLP as
independent auditors of the Company for the fiscal year ending
December 31, 1999:

FOR WITHHELD ABSTAIN

11,590,348 45,295 32,657

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ITEM 5. OTHER INFORMATION

Not Applicable.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

3.02 Bylaws of the Company, as amended
27.01 Financial Data Schedule (for SEC use only)

(b) Reports on Form 8-K

Registrant did not file any reports on Form 8-K during the quarter for
which this report was filed.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

CHOICEPOINT INC.
--------------------------------------------
(Registrant)

August 13, 1999 /s/ Derek V. Smith
- ---------------------- --------------------------------------------
Date Derek V. Smith, Chairman and
Chief Executive Officer

August 13, 1999 /s/ David E. Trine
- ---------------------- --------------------------------------------
Date David E. Trine, Vice President and
Corporate Controller (Principal Accounting Officer)

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EXHIBIT INDEX

Exhibit Description of Exhibit
- ------- ----------------------

3.02 Bylaws of the Company, as amended

27.01 Financial Data Schedule (for SEC use only)