Fidelity National Information Services, Inc. · NYSE:FIS
Fidelity National Information Services — Q3 2017 Earnings Presentation
30 slides from Fidelity National Information Services's earnings presentation, Oct 31, 2017
Slide 1: Third Quarter 2017 Earnings Call
Third Quarter 2017 Earnings Call October 31, 2017 ©2017 FIS and/or its subsidiaries. All Rights Reserved.
Slide 2: Agenda
Agenda TOPIC SPEAKER Gary Norcross Business Summary President and CEO Woody Woodall Financial Summary Chief Financial Officer 2
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 Summary
Business Summary Gary Norcross President and CEO 4
Slide 5: Third Quarter Highlights
Third Quarter Highlights • $2.2 BILLION adjusted revenue • $1.18 adjusted EPS • CONFIDENCE in increased full-year earnings outlook 5
Slide 6: Third Quarter Business Update
Third Quarter Business Update • Integrated Financial Solutions (IFS) – Demand continues for business solutions – Balanced growth in retail banking and wealth • Global Financial Solutions (GFS) – Broad demand for risk, compliance and global securities continues – Growth in buy-side and post-trade sol
Slide 7: Strategic Growth Levers
Strategic Growth Levers • EXECUTE on differentiating capabilities • CAPITALIZE on global scale • INVEST for long-term success 7
Slide 8: Financial Summary
Financial Summary Woody Woodall Chief Financial Officer 8
Slide 9: Consolidated Results
Consolidated Results Third quarter (Q3) and nine months (YTD) 2017 ($ millions, except per share data) METRICS Q3 2017 Y-o-Y vs Q3 2016 Adj. Revenue $ 2,200 0.8% Organic(1) Adj. EBITDA $ 760 (0.8)% Adj. EBITDA Margin 34.5% 180 bps Adj. EPS $ 1.18 18.0% METRICS YTD 2017 Y-o-Y vs YTD 2016 Adj. Revenue
Slide 10: Integrated Financial Solutions
Integrated Financial Solutions Third quarter (Q3) and nine months (YTD) 2017 ($ millions) METRICS Q3 2017 Y-o-Y vs Q3 2016 Revenue $ 1,120 1.3% Organic(1) Adj. EBITDA $ 458 1.0% Adj. EBITDA Margin 40.9% 20 bps METRICS YTD 2017 Y-o-Y vs YTD 2016 Revenue $ 3,430 1.8% Organic(1) Adj. EBITDA $ 1,369 3.4
Slide 11: Integrated Financial Solutions
Integrated Financial Solutions Revenue Contribution Revenue Composition – Q3 ($ millions) RECURRING REVENUE | 90% Third Organic Quarter Growth Banking and Wealth $ 468 3.8% PROF. SERVICES | 7% Payments 454 (1.8)% OTHER | 3% Corporate and Digital 199 3.5% Total Integrated $ 1,120 1.3% Financial Solut
Slide 12: Global Financial Solutions
Global Financial Solutions Third quarter (Q3) and nine months (YTD) 2017 ($ millions) METRICS Q3 2017 Y-o-Y vs Q3 2016 Revenue $ 997 2.5% Organic(1) Adj. EBITDA $ 359 4.7% Adj. EBITDA Margin 36.0% 390 bps METRICS YTD 2017 Y-o-Y vs YTD 2016 Revenue $ 3,092 3.2% Organic(1) Adj. EBITDA $ 973 10.5% Adj.
Slide 13: Global Financial Solutions
Global Financial Solutions Revenue Contribution Revenue Composition – Q3 ($ millions) RECURRING REVENUE | 71% Third Organic Quarter Growth Institutional and $ 528 6.3% PROF. SERVICES | 21% Wholesale Banking and 425 (2.2)% Payments Consulting(1) 45 n/a OTHER | 8% Total Global $ 997 2.5% Financial Sol
Slide 14: Corporate and Other
Corporate and Other Third quarter (Q3) and nine months (YTD) 2017 ($ millions) METRICS Q3 2017 Y-o-Y vs Q3 2016 Adj. Revenue $ 83 (20.6)% Organic(1) Adj. EBITDA $ (57) n/a Corporate Expense $ 75 0.2% METRICS YTD 2017 Y-o-Y vs YTD 2016 Adj. Revenue $ 278 (14.8)% Organic(1) Adj. EBITDA $ (155) n/a Cor
Slide 15: Cash Flow and Capital Allocation Strategy
Cash Flow and Capital Allocation Strategy • Cash flow generation – Free cash flow of $402 million in Q3 2017 and $1,044 million YTD • Maintaining a strong balance sheet – $9.1 billion debt outstanding as of September 30, 2017 • Shareholder returns – Dividends of $97 million in Q3 2017 and $289 milli
Slide 16: 2017 Guidance Updated
2017 Guidance Updated ($ millions, except per share data) FY 2017 Guidance FY 2017 Guidance METRICS (as of 8/2/17) (as of 10/31/17) Consolidated Organic 2% – 3% No Change Revenue Growth IFS Organic 3% – 4% 2.5% – 3% Revenue Growth GFS Organic 4% – 5% No Change Revenue Growth $4.22 – $4.32 $4.38 – $4
Slide 17: Competitive Business Model
Competitive Business Model • GENERATE strong cash flow • MAINTAIN attractive balance sheet • INVEST in growth 17
Slide 18: Appendix
APPENDIX His
Slide 19: Consolidated Q3 GAAP to Organic Growth Bridge
Consolidated Q3 GAAP to Organic Growth Bridge ($ millions) Third Quarter 2016 Third Quarter 2017 $2,400 $2,400 $37 $2,350 $2,350 $2,309 $2,300 $2,300 $2,250 $2,250 $2,198 $2 $2,200 $2,200 $2,190 $2,172 $(10) $2,150 $(174) $2,150 $2,100 $2,100 $2,050 $2,050 Q3 2016 Deferred M&A Q3 2016 Q3 2017 Deferr
Slide 20: Consolidated YTD GAAP to Organic Growth Bridge
Consolidated YTD GAAP to Organic Growth Bridge ($ millions) Nine Months 2016 Nine Months 2017 $7,000 $7,000 $177 $6,950 $6,950 $6,900 $6,900 $6,850 $6,850 $6,795 $6,794 $6 $1 $6,801 $6,800 $6,800 $6,750 $6,750 $6,700 $6,693 $6,700 $(279) $6,650 $6,650 $6,600 $6,600 $6,550 $6,550 YTD 2016 Deferred M&
Slide 21: Forward-looking Statements
Forward-looking Statements This presentation and today’s webcast may contain statements, estimates or projections that constitute “forward-looking statements” pursuant to the safe harbor provisions of the U.S. federal securities laws. Generally, the words “believe,” “expect,” “intend,” “estimate,” “
Slide 22: Forward-looking Statements
Forward-looking Statements • the risks of reduction in revenue from the elimination of existing and potential customers due to consolidation in, or new laws or regulations affecting, the banking, retail and financial services industries or due to financial failures or other setbacks suffered by firm
Slide 23: Non-GAAP Financial Information and Reconciliation
Non-GAAP Financial Information and Reconciliation Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactio
Slide 24: Non-GAAP Financial Information and Reconciliation
Non-GAAP Financial Information and Reconciliation Adjusted revenue consists of processing and services revenue, increased to reverse the purchase accounting deferred revenue adjustment made upon the acquisition of SunGard. The deferred revenue adjustment represents revenue that would have been recog
Slide 25: Non-GAAP Financial Information and Reconciliation
Non-GAAP Financial Information and Reconciliation Adjusted net earnings from continuing operations excludes the impact of certain costs and other transactions which management deems non-operational in nature, the removal of which improves comparability of operating results across reporting periods.
Slide 26: Organic Revenue Growth Calculation
Organic Revenue Growth Calculation Third quarter (Q3) 2017 ($ millions) Three months ended September 30, 2017 Integrated Global Financial Financial Corporate Solutions Solutions and Other Consolidated Processing and services revenue $ 1,120 $ 997 $ 81 $ 2,198 Non-GAAP adjustments: Acquisition deferr
Slide 27: Organic Revenue Growth Calculation
Organic Revenue Growth Calculation Nine months (YTD) 2017 ($ millions) Nine months ended September 30, 2017 Integrated Global Financial Financial Corporate Solutions Solutions and Other Consolidated Processing and services revenue $ 3,430 $ 3,092 $ 272 $ 6,794 Non-GAAP adjustments: Acquisition defer
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, September 30, 2017 2016 2017 2016 Net earnings from continuing operations attributable to FIS $ 61 $ 185 $ 331 $ 360 Provision for income taxes 51 103 262 200 Interest expense, ne
Slide 29: Reconciliation of GAAP to Non-GAAP Financials
Reconciliation of GAAP to Non-GAAP Financials ($ millions, except per share data, unaudited) Three months ended Nine months ended September 30, September 30, 2017 2016 2017 2016 Earnings from continuing operations before income taxes and equity method investment earnings $ 122 $ 294 $ 617 $ 573 Prov
Slide 30: Reconciliation of GAAP to Non-GAAP Financials
Reconciliation of GAAP to Non-GAAP Financials ($ millions, unaudited) Three months ended Nine months ended September 30, 2017 September 30, 2017 Net cash provided by operating activities $ 534 $ 1,079 Non-GAAP adjustments: Acquisition, integration and severance payments 11 74 Tax payments on divesti
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