Fidelity National Information Services, Inc. · NYSE:FIS
Fidelity National Information Services — Q1 2021 Earnings Presentation
27 slides from Fidelity National Information Services's earnings presentation, May 6, 2021
Slide 1: First Quarter 2021 Earnings Call
FIRST QUARTER 2021 EARNINGS CALL May 6, 2021
Slide 2: Speakers
SPEAKERS BUSINESS & Gary Norcross STRATEGY Chairman and UPDATE Chief Executive Officer FINANCIAL RESULTS & Woody Woodall Chief Financial Officer GUIDANCE
Slide 3: Disclosures
DISCLOSURES Forward-looking Statements Our discussions today, including this presentation and any comments made by management, contain “forward-looking statements” within the meaning of the U.S. federal securities laws. Any statements that refer to future events or circumstances, including our futur
Slide 4: Business & Strategy Update
BUSINESS & STRATEGY UPDATE
Slide 5: Strong Growth Across All Segments
STRONG GROWTH ACROSS ALL SEGMENTS IR Magazine “Best ESG TOTAL REVENUE EXCEPTIONAL SEGMENT PERFORMANCE 5% Reporting” 4% Banking Merchant Capital Market Award $ 3.2 Solutions Solutions Solutions IR Magazine Awards “Best ESG Reporting” ORGANIC REVENUE GROWTH 1 7% 3% 5% BILLION $1.5B $1.0B $625M NEW INC
Slide 6: New Technology Solutions Accelerating Growth in Banking
NEW TECHNOLOGY SOLUTIONS ACCELERATING GROWTH IN BANKING Client-centric strategic technology investments driving differentiated competitive position NEW SALES DRIVING GLOBAL FINANCIAL POWERFUL CLIENT NEW TECHNOLOGY SOLUTIONS GROWTH INSTITUTIONS VALUE POPOSITION RealNet 24% + Modern Banking Platform ‘
Slide 7: Rapidly Accelerating Trends in Merchant
RAPIDLY ACCELERATING TRENDS IN MERCHANT Leading global eCommerce and omnichannel capabilities yield sustainable competitive advantages SALES EXECUTION GLOBAL ECOM CRYPTOCURRENCY NEWEST PAYMENTS PLATFORM NAP Migration Complete 1.8B + 18% 2x 5x 370M 195M 1 1 80M New Sales CAGR eCom New Sales Revenue G
Slide 8: Leading the Industry in Capital Markets
LEADING THE INDUSTRY IN CAPITAL MARKETS End-to-end solutions and growing mix of SAAS-based recurring revenue accelerating revenue growth ACCELERATING RECURRING END-TO-END SOLUTIONS WINNING NEW CLIENTS SAAS REVENUE MODEL REVENUE GROWTH + 36 % + 30 % + 57 % 3% 2% 2018 2019 2020 2021 E Average Deal Ne
Slide 9: Strategy for Success
STRATEGY FOR SUCCESS Consistent execution of our strategy is driving client demand I II III ADVANCE STRATEGICALLY DRIVE EFFICIENCY TECHNOLOGY AND ALLOCATE AND SCALABILITY INNOVATION CAPITAL ACCELERATE MAXIMIZE EXPAND REVENUE SHAREHOLDER MARGINS GROWTH VALUE ONGOING INVESTMENT TO FULFILL THE POTENTIA
Slide 10: Financial Results & Guidance
FINANCIAL RESULTS & GUIDANCE
Slide 11: Consolidated Financial Results
CONSOLIDATED FINANCIAL RESULTS EXCEPTIONAL 1Q 2021 RESULTS REVENUE ($ in millions) with strong growth across all three operating segments 1Q21 $3,223 • Revenue increased 5%, or 4% organically, exceeding expectations across all three operating segments • Adj. EBITDA margin expanded 10 basis points Y-
Slide 12: 1Q 2021 Segment Results
1Q 2021 SEGMENT RESULTS REVENUE ($ in millions) BANKING SOLUTIONS1 • Revenue increased 7%, or 6% organically, primarily driven by 1Q21 $1,540 ramping of large bank wins and continued strong recurring revenue growth 1Q20 • Organic revenue growth is expected to trend higher throughout the year, genera
Slide 13: Merchant Yields Turned Positive Exiting March
MERCHANT YIELDS TURNED POSITIVE EXITING MARCH Merchant Monthly Revenue, Volume and Yield Trends1 Organic Revenue Growth Volume Growth Yield ~70% 19% ~65% 0.2 18% 20% 0.1 6% 10% 3% -8% -6% 0 0% -1% +5% -0.1 -10% -9% -0.2 -14% -20% January February March Exiting March2 • Revenue to volume yield turned
Slide 14: Strong Balance Sheet and Return of Capital
STRONG BALANCE SHEET AND RETURN OF CAPITAL RETURN OF CAPITAL 1Q 2021 STRONG BALANCE SHEET 1Q 2021 Free Cash Flow $556M Total Debt $19.4B Dividends Paid $244M Weighted Average Interest Rate 1.0% Shares Repurchased 2.8M Leverage Ratio 3.6x Share Repurchase Amount $400M Target Leverage Ratio <3.0x • Sh
Slide 15: Initiating 2Q and Raising FY 2021 Guidance
INITIATING 2Q AND RAISING FY 2021 GUIDANCE ($ millions, except per share data) METRICS 2Q 2021 FY 2021 Revenue $3,365 - $3,390 $13,650 - $13,750 Organic Revenue Growth 13% - 14% 8% - 9% Adjusted EBITDA $1,460 - $1,480 $6,075 - $6,175 Year-over-year Growth 26% - 28% 16% - 17% Margin Expansion 430 - 4
Slide 16: Appendix
APPENDIX
Slide 17: 2Q 2021 Guidance – Additional Assumptions
2Q 2021 GUIDANCE – ADDITIONAL ASSUMPTIONS ($ millions) METRICS 2Q 2021 GUIDANCE Positive F/X Impact to Revenue ~$40 Corporate and Other Revenue Growth ~(10)% Depreciation and Amortization ~$285 (Excluding Purchase Price Amortization) Net Interest Expense ~$55 Effective Tax Rate ~14.5% Weighted Avera
Slide 18: FY 2021 Guidance – Additional Assumptions
FY 2021 GUIDANCE – ADDITIONAL ASSUMPTIONS ($ millions) METRICS FY 2021 GUIDANCE Positive F/X Impact to Revenue ~$100 - $110 Corporate and Other Revenue Growth ~(10)% Depreciation and Amortization ~$1,150 (Excluding Purchase Price Amortization) Net Interest Expense ~$230 Effective Tax Rate ~14.5% Wei
Slide 19: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation and today’s webcast contain “forward-looking statements” within the meaning of the U.S. federal securities laws. Statements that are not historical facts, including statements about anticipated financial outcomes, including any earnings guidance or projec
Slide 20: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS • competitive pressures on pricing related to the decreasing number of community banks in the U.S., the development of new disruptive technologies competing with one or more of our solutions, increasing presence of international competitors in the U.S. market and the entry
Slide 21: FIS Use of Non-GAAP Financial Information
FIS USE OF NON-GAAP FINANCIAL INFORMATION Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting in the United States. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizi
Slide 22: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2021 MERCHANT BANKING CAPITAL MARKET CORPORATE TOTAL SOLUTIONS SOLUTIONS SOLUTIONS AND OTHER Revenue $966 $1,540 $625 $92 $3,223 FX (21) (4) (10) (1) (36) Constant Currency Revenue $945 $1,536 $615 $91
Slide 23: 2020 Organic Base
2020 ORGANIC BASE ($ millions) Organic Base 1Q 2020 2Q 2020 3Q 2020 4Q 2020 FY 2020 Banking Solutions $ 1,444 $ 1,462 $ 1,488 $ 1,551 $ 5,944 Merchant Solutions 935 812 1,017 1,003 3,767 Capital Market Solutions 597 593 587 663 2,440 Operating Segment Total $ 2,976 $ 2,867 $ 3,092 $ 3,217 $ 12,152 T
Slide 24: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2021 2020 Net earnings (loss) attributable to FIS common stockholders $(373) $15 Provision (benefit) for income taxes (97) (30) Interest expense, net 74 80 Other, net 495 43 Operating income, as report
Slide 25: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2021 2020 Earnings (loss) before income taxes and equity method investment earnings (loss) $(468) $(11) (Provision) benefit for income taxes 97 30 Equity method investment earnings (loss) 1 (1) Net (ea
Slide 26: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2021 Net cash provided by operating activities $836 Non-GAAP adjustments: Acquisition, integration and other payments 117 Settlement activity (122) Adjusted cash flows from operations $831 Capital expe
Slide 27: Advancing the Way the World Pays, Banks and Invests
(— | — ADVANCING THE WAY THE WORLD PAYS, BANKS AND INVESTS™
Fidelity National Information Services — Q1 2021 Earnings Presentation on 6ix