Fidelity National Information Services, Inc. · NYSE:FIS

Fidelity National Information Services — Q3 2018 Earnings Presentation

31 slides from Fidelity National Information Services's earnings presentation, Oct 30, 2018

  1. Slide 1: Third Quarter 2018 Earnings Call

    Third Quarter 2018 Earnings Call October 30, 2018 ©2018 FIS and/or its subsidiaries. All Rights Reserved.

  2. Slide 2: Agenda

    Agenda Gary Norcross, Business Summary Chairman, President and CEO Woody Woodall, Financial Summary Chief Financial Officer 2

  3. 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

  4. Slide 4: Business Summary

    Business Summary Gary Norcross Chairman, President and CEO 4

  5. Slide 5: Key Themes for the Quarter

    Key Themes for the Quarter • INCREASING digital modernization wins • EXPANDING market share • STRONG momentum into next year 5

  6. Slide 6: Strategic Growth Levers

    Strategic Growth Levers INNOVATE DRIVE BUILD for long-term strong sales with on our global growth market-leading scale solutions 6

  7. Slide 7: Financial Summary

    Financial Summary Woody Woodall Chief Financial Officer 7

  8. Slide 8: Consolidated Results

    Consolidated Results Third Quarter (Q3) and Nine Months (YTD) 2018 ($ millions, except per share amounts) METRICS Q3 2018 YOY vs Q3 2017 Adj. Revenue $ 2,085 4.0% Organic(1) Adj. EBITDA $ 808 7.6% Adj. EBITDA Margin 38.7% 290 bps Adj. EPS $ 1.33 13.7% METRICS YTD 2018 YOY vs YTD 2017 Adj. Revenue $

  9. Slide 9: Integrated Financial Solutions

    Integrated Financial Solutions Third Quarter (Q3) and Nine Months (YTD) 2018 ($ millions) METRICS Q3 2018 YOY vs Q3 2017 Revenue $ 1,090 5.6% Organic(1) Adj. EBITDA $ 496 5.9% Adj. EBITDA Margin 45.5% 30 bps METRICS YTD 2018 YOY vs YTD 2017 Revenue $ 3,275 4.3% Organic(1) Adj. EBITDA $ 1,440 4.8% Ad

  10. Slide 10: Integrated Financial Solutions Revenue Contribution

    Integrated Financial Solutions ($ millions) REVENUE CONTRIBUTION ($ millions) Third Organic Nine Organic Quarter Growth Months Growth Banking and Wealth $ 495 5.0% $ 1,537 5.2% Payments 386 7.7% 1,114 2.7% Corporate and Digital 209 2.7% 625 5.0% Total Integrated $ 1,090 5.6% $ 3,275 4.3% Financial S

  11. Slide 11: Global Financial Solutions

    Global Financial Solutions Third Quarter (Q3) and Nine Months (YTD) 2018 ($ millions) METRICS Q3 2018 YOY vs Q3 2017 Revenue $ 916 2.5% Organic(1) Adj. EBITDA $ 355 5.2% Adj. EBITDA Margin 38.7% 420 bps METRICS YTD 2018 YOY vs YTD 2017 Revenue $ 2,742 1.6% Organic(1) Adj. EBITDA $ 973 3.5% Adj. EBIT

  12. Slide 12: Global Financial Solutions Revenue Contribution

    Global Financial Solutions ($ millions) REVENUE CONTRIBUTION ($ millions) Third Organic Nine Organic Quarter Growth Months Growth Institutional and Wholesale $ 497 1.1% $ 1,484 0.5% Banking and Payments 420 4.4% 1,259 2.9% Total Global $ 916 2.5% $ 2,742 1.6% Financial Solutions(1) (1) Amount may no

  13. Slide 13: Corporate and Other

    Corporate and Other Third Quarter (Q3) and Nine Months (YTD) 2018 ($ millions) METRICS Q3 2018 YOY vs Q3 2017 Adj. Revenue $ 79 1.2% Organic(1) Adj. EBITDA $ (43) n/a Corporate Expense $ 55 (25.7)% METRICS YTD 2018 YOY vs YTD 2017 Adj. Revenue $ 243 (5.7)% Organic(1) Adj. EBITDA $ (143) n/a Corporat

  14. Slide 14: Debt Review and Capital Allocation

    Debt Review and Capital Allocation • Free cash flow of $356 million in Q3 2018 • Maintaining a strong balance sheet – $9.0 billion debt outstanding as of September 30, 2018 – Weighted average interest rate of 3.5% • Shareholder returns – Share repurchases of approximately $465 million in Q3 2018 – D

  15. Slide 15: 2018 Guidance Revised

    2018 Guidance Revised ($ millions, except per share amounts) FY 2018 Guidance FY 2018 Guidance METRICS (as of 7/31/18) (as of 10/30/18) Consolidated Organic 2.5% – 3.5% ~3.0% Revenue Growth IFS Organic 3.0% – 4.0% ~4.0% Revenue Growth GFS Organic 3.0% – 4.0% ~3.0% Revenue Growth Adjusted EBITDA Marg

  16. Slide 16: Why Invest in FIS

    Why Invest in FIS Continued High-quality Double-digit Strong Compelling Market Recurring EPS Growth Cash Flow Investment Leadership Revenue Generation Thesis 16

  17. Slide 17: Appendix

    APPENDIX His

  18. Slide 18: Debt Summary

    Debt Summary Dec 31, Sep 30, ($ millions) Rate 2017 2018 Revolver (2023 Maturity) L+125 bps $ 195 $ 582 Undrawn revolver capacity 15 bps 2,805 3,418 2018 Notes (April) 2.000% 250 - 2018 Notes (October) 2.850% 750 - 2020 Notes (October) 3.625% 1,150 1,150 2021 EUR Notes (January) (1) 0.400% 599 580 2

  19. 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 of the Co

  20. Slide 20: Forward-Looking Statements

    Forward-Looking Statements • 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

  21. Slide 21: Non-GAAP Financial Information and Reconciliation

    Non-GAAP Financial Information and Reconciliation 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 s

  22. Slide 22: Non-GAAP Financial Information and Reconciliation

    Non-GAAP Financial Information and Reconciliation 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 cour

  23. Slide 23: Non-GAAP Financial Information and Reconciliation

    Non-GAAP Financial Information and Reconciliation 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 impac

  24. Slide 24: Organic Revenue Growth Calculation

    Organic Revenue Growth Calculation Third Quarter (Q3) 2018 ($ millions, unaudited) Three months ended September 30, 2018 Integrated Global Financial Financial Corporate Solutions Solutions and Other Consolidated Revenue $ 1,090 $ 916 $ 78 $ 2,084 Non-GAAP adjustments: Acquisition deferred revenue ad

  25. Slide 25: Organic Revenue Growth Calculation

    Organic Revenue Growth Calculation Nine Months (YTD) 2018 ($ millions, unaudited) Nine months ended September 30, 2018 Integrated Global Financial Financial Corporate Solutions Solutions and Other Consolidated Revenue $ 3,275 $ 2,742 $ 239 $ 6,256 Non-GAAP adjustments: Acquisition deferred revenue a

  26. Slide 26: Reconciliation of GAAP to Non-GAAP Financials

    Reconciliation of GAAP to Non-GAAP Financials ($ millions, unaudited) Three months ended Nine months ended September 30, September 30, 2018 2017 2018 2017 Net earnings attributable to FIS common stockholders $ 154 $ 59 $ 548 $ 327 Provision (benefit) for income taxes 37 50 122 260 Interest expense,

  27. Slide 27: Reconciliation of GAAP to Non-GAAP Financials

    Reconciliation of GAAP to Non-GAAP Financials ($ millions, except per share amounts, unaudited) Three months ended Nine months ended September 30, September 30, 2018 2017 2018 2017 Earnings before income taxes and equity method investment earnings (loss) $ 204 $ 119 $ 704 $ 611 Provision (benefit) f

  28. Slide 28: Reconciliation of GAAP to Non-GAAP Financials

    Reconciliation of GAAP to Non-GAAP Financials ($ millions, unaudited) Three months ended Nine months ended September 30, 2018 September 30, 2018 Net cash provided by operating activities $ 464 $ 1,288 Non-GAAP adjustments: Acquisition, integration and other payments 16 76 Tax payments on divestiture

  29. Slide 29: Reconciliation of GAAP to Non-GAAP Financials

    Reconciliation of GAAP to Non-GAAP Financials ($ millions, unaudited) Year ended December 31, 2018 Consolidated GAAP revenue increase/(decrease) (2.5)% Estimated adjustments 5.5% Consolidated organic revenue increase/(decrease) 3.0% IFS GAAP revenue increase/(decrease) 3.5% Estimated adjustments 0.5

  30. Slide 30: Reconciliation of GAAP to Non-GAAP Financials

    Reconciliation of GAAP to Non-GAAP Financials ($ millions, unaudited) Year ended December 31, 2018 Net earnings margin attributable to FIS common stockholders 11.0% Estimated adjustments 26.0% Adjusted EBITDA margin 37.0% Estimated adjustments for the full-year 2018 include purchase accounting amort

  31. Slide 31: Reconciliation of GAAP to Non-GAAP Financials

    Reconciliation of GAAP to Non-GAAP Financials ($ millions, except per share data, unaudited) Year ended December 31, 2018 Low High Diluted EPS $ 2.69 $ 2.76 Estimated adjustments 2.51 2.48 Adjusted EPS $ 5.20 $ 5.24 Estimated adjustments for the full-year 2018 include purchase accounting amortizatio

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