[May 01, 2018] |
|
FIS Reports First Quarter 2018 Results
FIS™
(NYSE:FIS), a global leader in financial services technology, today
reported first quarter 2018 results. All financial results, calculations
and year over year comparisons reflect the adoption of Accounting
Standards Codification 606 (ASC 606) on a full retrospective basis. The
comparability of the Company's GAAP results is impacted by the
divestitures of its public sector and education business and its
consulting businesses in 2017.
GAAP revenue decreased 3.8 percent to $2,066 million from $2,148 million
in the prior year quarter. Operating income increased to $294 million
from $246 million in the prior year quarter, while operating income
margin expanded 280 basis points to 14.2 percent. Net earnings
attributable to common stockholders was $182 million for the quarter, or
$0.54 per diluted share, compared to $0.39 per diluted share in the
prior year quarter, an increase of 38.5 percent.
For the first quarter, organic revenue increased 3.3 percent. Adjusted
EBITDA increased to $705 million for the quarter, from $661 million in
the prior year quarter, while adjusted EBITDA margin expanded 340 basis
points to 34.1 percent. Adjusted net earnings attributable to common
stockholders was $363 million for the quarter, or $1.09 per diluted
share, compared to $0.82 per diluted share in the prior year quarter, an
increase of 32.9 percent.
"The results for the quarter provided us a very strong start to 2018,"
said Gary Norcross, FIS president and chief executive officer. "We are
seeing an increase in demand for our solutions, as evidenced by our
increased growth rate as well as our strong signings in new sales for
the quarter."
Segment Information
The Company's segment GAAP results were impacted by the divestitures of
its public sector and education business and its consulting businesses
in 2017.
-
Integrated Financial Solutions (IFS):
GAAP revenue increased 2.3 percent to $1,061 million from $1,037 million
in the prior year quarter. Organic revenue increased 3.2 percent.
Adjusted EBITDA increased to $451 million from $439 million in the prior
year quarter, and adjusted EBITDA margin was 42.5 percent, representing
expansion of 10 basis points.
-
Global Financial Solutions (GFS):
GAAP revenue decreased 7.6 percent to $927 million from $1,003 million
in the prior year quarter. Organic revenue increased 5.4 percent.
Adjusted EBITDA increased to $305 million from $265 million in the prior
year quarter, and adjusted EBITDA margin was 32.9 percent, representing
expansion of 650 basis points.
GAAP revenue decreased 27.6 percent to $78 million compared to $108
million in the prior year quarter. Organic revenue decreased 14.1
percent. Adjusted EBITDA loss was $51 million and is inclusive of $67
million of corporate expenses.
Balance Sheet and Cash Flow
As of March 31, 2018, cash and cash equivalents totaled $725 million and
debt outstanding totaled $9,076 million with a weighted average interest
rate of 3.3 percent. First quarter net cash provided by operating
activities was $354 million and free cash flow was $226 million. Free
cash flow was impacted by timing of tax payments and working capital.
The Company repurchased 4.1 million common shares at a total cost of
approximately $400 million in the first quarter. Approximately $3,500
million remained under the existing share repurchase authorization as of
March 31, 2018. The Company paid dividends of $106 million in the first
quarter.
Full-Year 2018 EPS Guidance Increased
2018 GAAP Guidance
-
Consolidated GAAP revenue decrease of 1.5 to 2.5 percent;
-
IFS GAAP revenue increase of 1.5 to 2.5 percent; and
-
GFS GAAP revenue decrease of 4.0 to 5.0 percent
-
Net earnings margin of 11.5 to 13.0 percent
-
Diluted EPS of $3.04 to $3.39, an increase from $3.00 to $3.35
2018 Non-GAAP Guidance
-
Consolidated organic revenue increase of 2.5 to 3.5 percent;
-
IFS organic revenue increase of 2.0 to 3.0 percent; and
-
GFS organic revenue increase of 4.0 to 5.0 percent
-
Adjusted EBITDA margin of 36.0 to 37.0 percent
-
Adjusted EPS of $5.14 to $5.34, an increase from $5.10 to $5.30
Webcast
FIS will sponsor a live webcast of its earnings conference call with the
investment community beginning at 8:30 a.m. (EDT) Tues., May 1, 2018. To
access the webcast, go to the Investor
Relations section of FIS' homepage, www.fisglobal.com.
A replay will be available after the conclusion of the live webcast.
Use of Non-GAAP Financial Information
Generally Accepted Accounting Principles (GAAP) is the term used to
refer to the standard framework of guidelines for financial accounting
in the United States. GAAP includes the standards, conventions, and
rules accountants follow in recording and summarizing transactions and
in the preparation of financial statements. In addition to reporting
financial results in accordance with GAAP, we have provided certain
non-GAAP financial measures.
These non-GAAP measures include adjusted revenue, constant currency
revenue, organic revenue increase/decrease, EBITDA, adjusted EBITDA,
adjusted EBITDA margin, adjusted net earnings (including per share
amounts), adjusted cash flow from operations and free cash flow. These
non-GAAP measures may be used in this release and/or in the attached
supplemental financial information.
We believe these non-GAAP measures help investors better understand the
underlying fundamentals of our business. As further described below, the
non-GAAP revenue and earnings measures presented eliminate items
management believes are not indicative of FIS's core operating
performance. The constant currency and organic revenue increase/decrease
measures adjust for the effects of exchange rate fluctuations, while
organic revenue increase/decrease also adjusts for acquisitions and
divestitures, giving investors further insight into our core
performance. Finally, the non-GAAP cash flow measures provide further
information about the ability of our business to generate cash. For
these reasons, management also uses these non-GAAP measures in its
assessment and management of FIS' performance.
Adjusted revenue consists of revenue, increased to reverse the
purchase accounting deferred revenue adjustment made upon the
acquisition of SunGard. The deferred revenue adjustment represents
revenue that would have been recognized in the normal course of business
by SunGard under GAAP but was not recognized due to GAAP purchase
accounting adjustments. The deferred revenue adjustment in purchase
accounting was made entirely in the Corporate and Other segment;
reported GAAP results for the IFS and GFS segments are not affected by
this adjustment and, therefore, no adjusted revenue is presented for
these segments.
Constant currency revenue represents (i) adjusted revenue, as
defined above, in respect of the consolidated results and the corporate
and other segment and (ii) reported revenue in respect of the IFS and
GFS segments, in each case excluding the impact of fluctuations in
foreign currency exchange rates in the current period.
Organic revenue increase/decrease is constant currency revenue,
as defined above, for the current period compared to an adjusted revenue
base for the prior period, which is further adjusted to add
pre-acquisition revenue of acquired businesses for a portion of the
prior year matching the portion of the current year for which the
business was owned, and subtract pre-divestiture revenue for divested
businesses for the portion of the prior year matching the portion of the
current year for which the business was not owned, for any acquisitions
or divestitures by FIS.
EBITDA reflects earnings from continuing operations before
interest, taxes, depreciation and amortization.
Adjusted EBITDA is EBITDA, as defined above, excluding certain
costs and other transactions which management deems non-operational in
nature, the removal of which improves comparability of operating results
across reporting periods. This measure is reported to the chief
operating decision maker for purposes of making decisions about
allocating resources to the segments and assessing their performance.
For this reason, adjusted EBITDA, as it relates to our segments, is
presented in conformity with Accounting Standards Codification 280,
Segment Reporting, and is excluded from the definition of non-GAAP
financial measures under the Securities and Exchange Commission's
Regulation G and Item 10(e) of Regulation S-K.
Adjusted EBITDA margin reflects adjusted EBITDA divided by
adjusted revenue.
Adjusted net earnings excludes the impact of certain costs and
other transactions which management deems non-operational in nature, the
removal of which improves comparability of operating results across
reporting periods. It also excludes the impact of acquisition-related
purchase accounting amortization, which is recurring.
Adjusted net earnings per diluted share, or Adjusted EPS,
reflects adjusted net earnings from continuing operations divided by
weighted average diluted shares outstanding.
Adjusted cash flow from operations reflects GAAP cash flow from
operations as adjusted for the net change in settlement assets and
obligations, and excludes certain transactions that are closely
associated with non-operating activities or are otherwise
non-operational in nature and not indicative of future operating cash
flows.
Free cash flow reflects adjusted cash flow from operations less
capital expenditures. Free cash flow does not represent our residual
cash flow available for discretionary expenditures, since we have
mandatory debt service requirements and other non-discretionary
expenditures that are not deducted from the measure.
Any non-GAAP measures should be considered in context with the GAAP
financial presentation and should not be considered in isolation or as a
substitute for GAAP measures. Further, FIS' non-GAAP measures may be
calculated differently from similarly titled measures of other
companies. Reconciliations of these non-GAAP measures to related GAAP
measures, including footnotes describing the specific adjustments, are
provided in the attached schedules and in the Investor Relations section
of the FIS web site, www.fisglobal.com.
About
FIS
FIS is a global leader in financial services technology, with a focus on
retail and institutional banking, payments, asset and wealth management,
risk and compliance, and outsourcing solutions. Through the depth and
breadth of our solutions portfolio, global capabilities and domain
expertise, FIS serves more than 20,000 clients in over 130 countries.
Headquartered in Jacksonville, Fla., FIS employs more than 53,000 people
worldwide and holds leadership positions in payment processing,
financial software and banking solutions. Providing software, services
and outsourcing of the technology that empowers the financial world, FIS
is a Fortune 500 company and is a member of Standard & Poor's 500®
Index. For more information about FIS, visit www.fisglobal.com.
Follow FIS on Facebook (facebook.com/FIStoday)
and Twitter (@FISGlobal).
Forward-Looking Statements
This news release and today's webcast contain "forward-looking
statements" within the meaning of the U.S. federal securities laws.
Statements that are not historical facts, including statements about
anticipated financial outcomes, including any earnings guidance of the
Company, business and market conditions, outlook, foreign currency
exchange rates, expected dividends and share repurchases, the Company's
sales pipeline and anticipated profitability and growth, as well as
other statements about our expectations, beliefs, intentions, or
strategies regarding the future, are forward-looking statements. These
statements relate to future events and our future results, and involve a
number of risks and uncertainties. Forward-looking statements are based
on management's beliefs, as well as assumptions made by, and information
currently available to, management. Any statements that refer to
beliefs, expectations, projections or other characterizations of future
events or circumstances and other statements that are not historical
facts are forward-looking statements.
Actual results, performance or achievement could differ materially from
those contained in these forward-looking statements. The risks and
uncertainties that forward-looking statements are subject to include,
without limitation:
-
the risk that acquired businesses will not be integrated successfully,
or that the integration will be more costly or more time-consuming and
complex than anticipated;
-
the risk that cost savings and other synergies anticipated to be
realized from acquisitions may not be fully realized or may take
longer to realize than expected;
-
the risk of doing business internationally;
-
changes in general economic, business and political conditions,
including the possibility of intensified international hostilities,
acts of terrorism, changes in either or both the United States and
international lending, capital and financial markets, and currency
fluctuations;
-
the effect of legislative initiatives or proposals, statutory changes,
governmental or other applicable regulations and/or changes in
industry requirements, including privacy and cybersecurity laws and
regulations;
-
the risks of reduction in revenue from the elimination of existing and
potential customers due to consolidation in, or new laws or
regulations affecting, the banking, retail and financial services
industries or due to financial failures or other setbacks suffered by
firms in those industries;
-
changes in the growth rates of the markets for our solutions;
-
failures to adapt our solutions to changes in technology or in the
marketplace;
-
internal or external security breaches of our systems, including those
relating to unauthorized access, theft, corruption or loss of personal
information and computer viruses and other malware affecting our
software or platforms, and the reactions of customers, card
associations, government regulators and others to any such events;
-
the risk that implementation of software (including software updates)
for customers or at customer locations may result in the corruption or
loss of data or customer information, interruption of business
operations, exposure to liability claims or loss of customers;
-
the reaction of current and potential customers to communications from
us or regulators regarding information security, risk management,
internal audit or other matters;
-
competitive pressures on pricing related to the decreasing number of
community banks in the U.S., the development of new disruptive
technologies competing with one or more of our solutions, increasing
presence of international competitors in the U.S. market and the entry
into the market by global banks and global companies with respect to
certain competitive solutions, each of which may have the impact of
unbundling individual solutions from a comprehensive suite of
solutions we provide to many of our customers;
-
the failure to innovate in order to keep up with new emerging
technologies, which could impact our solutions and our ability to
attract new, or retain existing, customers;
-
an operational or natural disaster at one of our major operations
centers; and
-
other risks detailed under "Risk Factors" and other sections of our
Annual Report on Form 10-K for the fiscal year ended December 31, 2017
and other filings with the SEC.
Other unknown or unpredictable factors also could have a material
adverse effect on our business, financial condition, results of
operations and prospects. Accordingly, readers should not place undue
reliance on these forward-looking statements. These forward-looking
statements are inherently subject to uncertainties, risks and changes in
circumstances that are difficult to predict. Except as required by
applicable law or regulation, we do not undertake (and expressly
disclaim) any obligation and do not intend to publicly update or review
any of these forward-looking statements, whether as a result of new
information, future events or otherwise.
Fidelity National Information Services, Inc. Earnings Release
Supplemental Financial Information May 1, 2018
Exhibit A Condensed Consolidated Statements of Earnings - Unaudited for
the three months ended March 31, 2018 and 2017
Exhibit B Condensed Consolidated Balance Sheets - Unaudited as of
March 31, 2018 and December 31, 2017
Exhibit C Condensed Consolidated Statements of Cash Flows - Unaudited
for the three months ended March 31, 2018 and 2017
Exhibit D Supplemental Non-GAAP Financial Information - Unaudited for
the three months ended March 31, 2018 and 2017
Exhibit E Supplemental GAAP to Non-GAAP Reconciliations - Unaudited for
the three months ended March 31, 2018 and 2017
Exhibit F Supplemental GAAP to Non-GAAP Reconciliations on Guidance -
Unaudited for the year ended December 31, 2018
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - UNAUDITED
|
(In millions, except per share data)
|
|
|
|
|
|
|
|
|
|
Exhibit A
|
|
|
|
|
|
|
|
Three months ended
|
|
|
March 31,
|
|
|
2018
|
|
2017
|
Revenues
|
|
$
|
2,066
|
|
|
$
|
2,148
|
|
Cost of revenues
|
|
1,414
|
|
|
1,491
|
|
Gross profit
|
|
652
|
|
|
657
|
|
Selling, general and administrative expenses
|
|
358
|
|
|
411
|
|
Operating income
|
|
294
|
|
|
246
|
|
Other income (expense):
|
|
|
|
|
Interest expense, net
|
|
(72
|
)
|
|
(93
|
)
|
Other income (expense), net
|
|
3
|
|
|
56
|
|
Total other income (expense), net
|
|
(69
|
)
|
|
(37
|
)
|
Earnings before income taxes and equity method investment earnings
|
|
225
|
|
|
209
|
|
Provision (benefit) for income taxes
|
|
34
|
|
|
74
|
|
Equity method investment earnings
|
|
(1
|
)
|
|
-
|
|
Net earnings
|
|
190
|
|
|
135
|
|
Net earnings attributable to noncontrolling interest
|
|
(8
|
)
|
|
(6
|
)
|
Net earnings attributable to FIS common stockholders
|
|
$
|
182
|
|
|
$
|
129
|
|
|
|
|
|
|
Net earnings per share-basic attributable to FIS common stockholders
|
|
$
|
0.55
|
|
|
$
|
0.39
|
|
Weighted average shares outstanding-basic
|
|
330
|
|
|
328
|
|
Net earnings per share-diluted attributable to FIS common
stockholders
|
|
$
|
0.54
|
|
|
$
|
0.39
|
|
Weighted average shares outstanding-diluted
|
|
334
|
|
|
333
|
|
|
|
|
|
|
|
|
Amounts in table may not sum due to rounding.
|
|
|
|
|
|
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED
|
(In millions, except per share data)
|
|
|
|
|
|
|
|
|
|
Exhibit B
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|
2018
|
|
2017
|
Assets
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
725
|
|
|
$
|
665
|
|
Settlement deposits
|
|
590
|
|
|
677
|
|
Trade receivables, net
|
|
1,562
|
|
|
1,624
|
|
Contract assets
|
|
107
|
|
|
108
|
|
Settlement receivables
|
|
346
|
|
|
291
|
|
Other receivables
|
|
96
|
|
|
70
|
|
Prepaid expenses and other current assets
|
|
309
|
|
|
253
|
|
Total current assets
|
|
3,735
|
|
|
3,688
|
|
Property and equipment, net
|
|
581
|
|
|
610
|
|
Goodwill
|
|
13,747
|
|
|
13,730
|
|
Intangible assets, net
|
|
3,707
|
|
|
3,885
|
|
Computer software, net
|
|
1,739
|
|
|
1,728
|
|
Deferred contract costs, net
|
|
392
|
|
|
354
|
|
Other noncurrent assets
|
|
504
|
|
|
531
|
|
Total assets
|
|
$
|
24,405
|
|
|
$
|
24,526
|
|
|
|
|
|
|
Liabilities and Equity
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$
|
1,018
|
|
|
$
|
1,241
|
|
Settlement payables
|
|
920
|
|
|
949
|
|
Deferred revenues
|
|
842
|
|
|
776
|
|
Current portion of long-term debt
|
|
1,036
|
|
|
1,045
|
|
Total current liabilities
|
|
3,816
|
|
|
4,011
|
|
Long-term debt, excluding current portion
|
|
8,040
|
|
|
7,718
|
|
Deferred income taxes
|
|
1,443
|
|
|
1,468
|
|
Deferred revenues
|
|
105
|
|
|
106
|
|
Other long-term liabilities
|
|
390
|
|
|
403
|
|
Total liabilities
|
|
13,794
|
|
|
13,706
|
|
Equity:
|
|
|
|
|
FIS stockholders' equity:
|
|
|
|
|
Preferred stock $0.01 par value
|
|
-
|
|
|
-
|
|
Common stock $0.01 par value
|
|
4
|
|
|
4
|
|
Additional paid in capital
|
|
10,585
|
|
|
10,534
|
|
Retained earnings
|
|
4,186
|
|
|
4,109
|
|
Accumulated other comprehensive earnings (loss)
|
|
(318
|
)
|
|
(332
|
)
|
Treasury stock, at cost
|
|
(3,962
|
)
|
|
(3,604
|
)
|
Total FIS stockholders' equity
|
|
10,495
|
|
|
10,711
|
|
Noncontrolling interest
|
|
116
|
|
|
109
|
|
Total equity
|
|
10,611
|
|
|
10,820
|
|
Total liabilities and equity
|
|
$
|
24,405
|
|
|
$
|
24,526
|
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
|
|
Exhibit C
|
|
|
|
|
|
|
|
Three months ended March 31,
|
|
|
2018
|
|
2017
|
Cash flows from operating activities:
|
|
|
|
|
Net earnings
|
|
$
|
190
|
|
|
$
|
135
|
|
Adjustments to reconcile net earnings to net cash provided by
operating activities:
|
|
|
|
|
Depreciation and amortization
|
|
352
|
|
|
332
|
|
Amortization of debt issue costs
|
|
5
|
|
|
12
|
|
Gain on sale of businesses
|
|
(7
|
)
|
|
(85
|
)
|
Stock-based compensation
|
|
20
|
|
|
26
|
|
Deferred income taxes
|
|
(14
|
)
|
|
(152
|
)
|
Net changes in assets and liabilities, net of effects from
acquisitions and foreign currency:
|
|
|
|
|
Trade receivables
|
|
44
|
|
|
11
|
|
Contract assets
|
|
2
|
|
|
57
|
|
Settlement activity
|
|
2
|
|
|
(36
|
)
|
Prepaid expenses and other assets
|
|
(43
|
)
|
|
(50
|
)
|
Deferred contract costs
|
|
(65
|
)
|
|
(36
|
)
|
Deferred revenue
|
|
69
|
|
|
96
|
|
Accounts payable, accrued liabilities and other liabilities
|
|
(201
|
)
|
|
144
|
|
Net cash provided by operating activities
|
|
354
|
|
|
454
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
Additions to property and equipment
|
|
(54
|
)
|
|
(44
|
)
|
Additions to computer software
|
|
(118
|
)
|
|
(111
|
)
|
Proceeds from sale of businesses
|
|
49
|
|
|
827
|
|
Other investing activities, net
|
|
(4
|
)
|
|
(1
|
)
|
Net cash provided by (used in) investing activities
|
|
(127
|
)
|
|
671
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
Borrowings
|
|
1,971
|
|
|
1,381
|
|
Repayment of borrowings and capital lease obligations
|
|
(1,711
|
)
|
|
(2,443
|
)
|
Proceeds from exercise of stock options
|
|
98
|
|
|
64
|
|
Treasury stock activity
|
|
(424
|
)
|
|
(17
|
)
|
Dividends paid
|
|
(106
|
)
|
|
(95
|
)
|
Other financing activities, net
|
|
(1
|
)
|
|
(4
|
)
|
Net cash used in financing activities
|
|
(173
|
)
|
|
(1,114
|
)
|
|
|
|
|
|
Effect of foreign currency exchange rate changes on cash
|
|
6
|
|
|
11
|
|
|
|
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
60
|
|
|
22
|
|
Cash and cash equivalents, at beginning of period
|
|
665
|
|
|
683
|
|
Cash and cash equivalents, at end of period
|
|
$
|
725
|
|
|
$
|
705
|
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION - UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit D
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, 2018
|
|
|
Integrated
|
|
Global
|
|
|
|
|
|
|
Financial
|
|
Financial
|
|
Corporate
|
|
|
|
|
Solutions
|
|
Solutions
|
|
and Other
|
|
Consolidated
|
Revenue
|
|
$
|
1,061
|
|
|
$
|
927
|
|
|
$
|
78
|
|
|
$
|
2,066
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
Acquisition deferred revenue adjustment (1)
|
|
-
|
|
|
-
|
|
|
2
|
|
|
2
|
Adjusted revenue
|
|
$
|
1,061
|
|
|
$
|
927
|
|
|
$
|
80
|
|
|
$
|
2,068
|
|
|
Three months ended March 31, 2017
|
|
|
Integrated
|
|
Global
|
|
|
|
|
|
|
Financial
|
|
Financial
|
|
Corporate
|
|
|
|
|
Solutions
|
|
Solutions
|
|
and Other
|
|
Consolidated
|
Revenue
|
|
$
|
1,037
|
|
|
$
|
1,003
|
|
|
$
|
108
|
|
|
$
|
2,148
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
Acquisition deferred revenue adjustment (1)
|
|
-
|
|
|
-
|
|
|
3
|
|
|
3
|
Adjusted revenue
|
|
1,037
|
|
|
1,003
|
|
|
111
|
|
|
2,151
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See note (3) to Exhibit E.
|
|
|
|
|
|
|
|
|
|
|
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL NON-GAAP ORGANIC REVENUE GROWTH - UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit D (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
Constant
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
|
|
|
Currency
|
|
Adjusted
|
|
In Year
|
|
Adjusted
|
|
Organic
|
|
|
Revenue (1)
|
|
FX
|
|
Revenue
|
|
Revenue (1)
|
|
Adjustments (2)
|
|
Base
|
|
Growth
|
Integrated Financial Solutions
|
|
$
|
1,061
|
|
|
$
|
(1
|
)
|
|
$
|
1,060
|
|
|
$
|
1,037
|
|
|
$
|
(10
|
)
|
|
$
|
1,027
|
|
|
3.2%
|
Global Financial Solutions
|
|
927
|
|
|
(20
|
)
|
|
907
|
|
|
1,003
|
|
|
(143
|
)
|
|
860
|
|
|
5.4%
|
Corporate and Other
|
|
80
|
|
|
(1
|
)
|
|
79
|
|
|
111
|
|
|
(18
|
)
|
|
93
|
|
|
(14.1)%
|
Total
|
|
$
|
2,068
|
|
|
$
|
(22
|
)
|
|
$
|
2,046
|
|
|
$
|
2,151
|
|
|
$
|
(171
|
)
|
|
$
|
1,980
|
|
|
3.3%
|
Amounts in table may not sum or calculate due to rounding.
|
|
(1)
|
|
See Note (3) to Exhibit E.
|
(2)
|
|
In year adjustments primarily include removing revenue from the PS&E
and Capco consulting business and risk and compliance consulting
business divestitures, as well as removing revenue from other
businesses divested by FIS.
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL NON-GAAP CASH FLOW MEASURES - UNAUDITED
|
(In millions)
|
|
Exhibit D (continued)
|
|
|
|
|
|
|
|
Three months ended March 31,
|
|
|
2018
|
|
2017
|
Net cash provided by operating activities
|
|
$
|
354
|
|
|
$
|
454
|
|
Non-GAAP adjustments:
|
|
|
|
|
Acquisition, integration and severance payments (1)
|
|
27
|
|
|
17
|
|
Tax payments on divestitures (2)
|
|
19
|
|
|
-
|
|
Bond premium (3)
|
|
-
|
|
|
11
|
|
Settlement activity
|
|
(2
|
)
|
|
36
|
|
Adjusted cash flows from operations
|
|
398
|
|
|
518
|
|
Capital expenditures
|
|
(172
|
)
|
|
(155
|
)
|
Free cash flow
|
|
$
|
226
|
|
|
$
|
363
|
|
Free cash flow reflects adjusted cash flow from operations less capital
expenditures. Free cash flow does not represent our residual cash flow
available for discretionary expenditures, since we have mandatory debt
service requirements and other non-discretionary expenditures that are
not deducted from the measure.
(1)
|
|
Adjusted cash flow from operations and free cash flow for the three
months ended March 31, 2018 and 2017 excludes cash payments for
certain acquisition, integration and severance expenses, net of
related tax impact. The related tax impact totaled $7 million and $9
million for the three months ended March 31, 2018 and 2017,
respectively.
|
|
|
|
(2)
|
|
Adjusted cash flow from operations excludes tax payments made in
2018 related to the sale of Capco consulting business and risk and
compliance consulting business recognized during 2017.
|
|
|
|
(3)
|
|
Adjusted cash flow from operations and free cash flow for the three
months ended March 31, 2017 is adjusted for the $11 million one time
bond premium payment, net of related tax impact of $7 million, on
the redemption of our senior notes due March 2022.
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS - UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
|
|
Exhibit E
|
|
|
|
|
|
|
|
Three months ended
|
|
|
March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
Net earnings attributable to FIS
|
|
$
|
182
|
|
|
$
|
129
|
|
Provision (benefit) for income taxes
|
|
34
|
|
|
74
|
|
Interest expense, net
|
|
72
|
|
|
93
|
|
Other, net
|
|
6
|
|
|
(50
|
)
|
|
|
|
|
|
Operating income, as reported
|
|
294
|
|
|
246
|
|
FIS depreciation and amortization, excluding purchase accounting
amortization
|
|
169
|
|
|
152
|
|
FIS non-GAAP adjustments:
|
|
|
|
|
Purchase accounting amortization (1)
|
|
183
|
|
|
180
|
|
Acquisition, integration and severance (2)
|
|
57
|
|
|
80
|
|
Acquisition deferred revenue adjustment (3)
|
|
2
|
|
|
3
|
|
Adjusted EBITDA
|
|
$
|
705
|
|
|
$
|
661
|
|
|
|
|
|
|
|
|
|
|
(1) See note (1) to Exhibit E.
|
|
(2) See note (2) to Exhibit E.
|
|
(3) See note (3) to Exhibit E.
|
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS - UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
Exhibit E (continued)
|
|
|
|
|
|
|
|
Three months ended
|
|
|
March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
Earnings before income taxes and equity method investment earnings
|
|
$
|
225
|
|
|
$
|
209
|
|
Provision (benefit) for income taxes
|
|
34
|
|
|
74
|
|
Equity method investment earnings
|
|
(1
|
)
|
|
-
|
|
Net earnings attributable to noncontrolling interest
|
|
(8
|
)
|
|
(6
|
)
|
Net earnings attributable to FIS
|
|
182
|
|
|
129
|
|
FIS non-GAAP adjustments:
|
|
|
|
|
Purchase accounting amortization (1)
|
|
183
|
|
|
180
|
|
Acquisition, integration and severance (2)
|
|
57
|
|
|
80
|
|
Acquisition deferred revenue adjustment (3)
|
|
2
|
|
|
3
|
|
Loss (gain) on businesses and investments (4)
|
|
(3
|
)
|
|
(85
|
)
|
Debt financing activities (5)
|
|
-
|
|
|
25
|
|
Provision for income taxes on non-GAAP adjustments
|
|
(58
|
)
|
|
(58
|
)
|
Total non-GAAP adjustments
|
|
181
|
|
|
145
|
|
Adjusted net earnings (loss), net of tax
|
|
$
|
363
|
|
|
$
|
274
|
|
|
|
|
|
|
Net earnings per share - diluted attributable to FIS common
stockholders
|
|
$
|
0.54
|
|
|
$
|
0.39
|
|
FIS non-GAAP adjustments:
|
|
|
|
|
Purchase accounting amortization (1)
|
|
0.55
|
|
|
0.54
|
|
Acquisition, integration and severance (2)
|
|
0.17
|
|
|
0.24
|
|
Acquisition deferred revenue adjustment (3)
|
|
0.01
|
|
|
0.01
|
|
Loss (gain) on businesses and investments(4)
|
|
(0.01
|
)
|
|
(0.26
|
)
|
Debt financing activities (5)
|
|
-
|
|
|
0.08
|
|
Provision for income taxes on non-GAAP adjustments
|
|
(0.17
|
)
|
|
(0.17
|
)
|
Adjusted net earnings (loss) per share - diluted attributable to FIS
common stockholders
|
|
$
|
1.09
|
|
|
$
|
0.82
|
|
|
|
|
|
|
Weighted average shares outstanding-diluted
|
|
334
|
|
|
333
|
|
|
|
|
|
|
|
|
Amounts in table may not sum or calculate due to rounding.
|
|
(1) See note (1) to Exhibit E.
|
(2) See note (2) to Exhibit E.
|
(3) See note (3) to Exhibit E.
|
(4) See note (4) to Exhibit E.
|
(5) See note (5) to Exhibit E.
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS - UNAUDITED
|
(In millions)
|
|
Notes to Unaudited - Supplemental GAAP to Non-GAAP Reconciliation
for the three months ended March 31, 2018 and 2017.
|
|
The adjustments are as follows:
|
|
(1)
|
|
|
This item represents purchase price amortization expense on all
intangible assets acquired through various Company acquisitions,
including customer relationships, contract value, trademarks and
tradenames, and non-compete agreements.
|
|
|
|
|
(2)
|
|
|
This item represents certain costs and other transactions which
management deems non-operational primarily related to integration
and severance activity from the SunGard acquisition.
|
|
|
|
|
(3)
|
|
|
This item represents the impact of the purchase accounting
adjustment to reduce SunGard's deferred revenues to estimated fair
value, determined as fulfillment cost plus a normal profit margin.
The deferred revenue adjustment represents revenue that would have
been recognized in the normal course of business by SunGard under
GAAP if the acquisition had not occurred, but was not recognized due
to GAAP purchase accounting requirements.
|
|
|
|
|
(4)
|
|
|
This item represents the pre-tax gain on businesses and investments
during the first quarter of 2018 and the pre-tax gain on the sale of
the Public Sector and Education ("PS&E") businesses and other
divestitures during the first quarter of 2017.
|
|
|
|
|
(5)
|
|
|
This item represents the write-off of certain previously capitalized
debt issuance costs and the payment of an $18 million bond premium
associated with the early redemption of our senior notes due March
2022 during March 2017.
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS ON GUIDANCE - UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
Exhibit F
|
|
|
|
|
|
|
|
Year ended
|
|
|
December 31, 2018
|
|
|
Low
|
|
High
|
|
|
|
|
|
Consolidated GAAP revenue increase/(decrease)
|
|
(2.5)%
|
|
(1.5)%
|
|
|
|
|
|
Estimated adjustments (1)
|
|
5.0%
|
|
5.0%
|
|
|
|
|
|
Consolidated organic revenue increase/(decrease)
|
|
2.5%
|
|
3.5%
|
|
|
|
|
|
|
|
Year ended
|
|
|
December 31, 2018
|
|
|
Low
|
|
High
|
|
|
|
|
|
IFS GAAP revenue increase/(decrease)
|
|
1.5%
|
|
2.5%
|
|
|
|
|
|
Estimated adjustments (1)
|
|
0.5%
|
|
0.5%
|
|
|
|
|
|
IFS organic revenue increase/(decrease)
|
|
2.0%
|
|
3.0%
|
|
|
|
|
|
|
|
Year ended
|
|
|
December 31, 2018
|
|
|
Low
|
|
High
|
|
|
|
|
|
GFS GAAP revenue increase/(decrease)
|
|
(5.0)%
|
|
(4.0)%
|
|
|
|
|
|
Estimated adjustments (1)
|
|
9.0%
|
|
9.0%
|
|
|
|
|
|
GFS organic revenue increase/(decrease)
|
|
4.0%
|
|
5.0%
|
(1)
|
|
Estimated adjustments for the full-year 2017 needed to create a
comparable base year for organic revenue increase/decrease include
the addition of deferred revenue adjustments, and the subtraction of
pre-divestiture revenue, in the applicable periods, associated with
the divestitures of PS&E, Capco consulting business and risk and
compliance consulting business, and Kingstar. Estimated adjustments
for the full-year 2018 include the addition of deferred revenue
adjustments and either the addition or subtraction of revenue
associated with foreign currency translation. The effect of the
foregoing estimated adjustments for 2018 are shown on a combined
basis.
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS ON GUIDANCE -
UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
Exhibit F (continued)
|
|
|
|
|
|
|
|
Year ended
|
|
|
December 31, 2018
|
|
|
Low
|
|
High
|
|
|
|
|
|
Net earnings per share - diluted attributable to FIS common
stockholders
|
|
$
|
3.04
|
|
|
$
|
3.39
|
|
|
|
|
|
Estimated adjustments (1)
|
|
2.10
|
|
|
1.95
|
|
|
|
|
|
Adjusted net earnings (loss) per share - diluted attributable to FIS
common stockholders
|
|
$
|
5.14
|
|
|
$
|
5.34
|
(1)
|
Estimated adjustments for the full year 2018 include purchase
accounting amortization, acquisition, integration and severance,
acquisition deferred revenue adjustments, and other costs, net of
tax impact.
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
|
SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS ON GUIDANCE -
UNAUDITED
|
(In millions)
|
|
|
|
|
|
|
|
Exhibit F (continued)
|
|
|
|
|
|
|
|
Year ended
|
|
|
December 31, 2018
|
|
|
Low
|
|
High
|
|
|
|
|
|
Net earnings margin attributable to FIS
|
|
11.5%
|
|
13.0%
|
|
|
|
|
|
Estimated adjustments (1)
|
|
24.5%
|
|
24.0%
|
|
|
|
|
|
Adjusted EBITDA margin
|
|
36.0%
|
|
37.0%
|
(1) Estimated adjustments for the full year 2018 include purchase
accounting amortization, acquisition, integration and severance,
acquisition deferred revenue adjustments, and other costs.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180501005234/en/
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