Fidelity National Information Services, Inc. · NYSE:FIS
Fidelity National Information Services — Investor Day (May 2016)
102 slides from Fidelity National Information Services's investor day presentation, May 10, 2016
Slide 1: 2016 Investor Conference
(— | S 2016 INVESTOR CONFERENCE EMPOWERING THE FINANCIAL WORLD
Slide 2: Disclosure
2 Disclosure 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 future
Slide 3: Strategic Overview, Segment Updates, Shareholder Value
STRATEGIC OVERVIEW Gary Norcross President and Chief Executive Officer SEGMENT UPDATES Anthony Jabbour Co-Chief Operating Officer Marianne Brown Co-Chief Operating Officer Lance Levy Chief Executive Officer, Capco SHAREHOLDER VALUE Woody Woodall Chief Financial Officer
Slide 4: Strategic Overview
STRATEGIC OVERVIEW Gary Norcross | President and Chief Executive Officer
Slide 5: Why Invest in FIS?
Why Invest in FIS? DEEP CLIENT RELATIONSHIPS DIVERSIFIED MARKETS SOLUTION AND DELIVERY SCALE INVESTMENT IN INNOVATION MISSION CRITICAL SYSTEMS COMPETITIVE DIFFERENTIATION • PREDICTABLE GROWTH • DIVERSIFICATION • LOWER RISK 5
Slide 6: Strategic Overview: FIS Today, Executing Our Strategy
STRATEGIC OVERVIEW FIS TODAY EXECUTING OUR STRATEGY
Slide 7: FIS Today: Empowering the Financial World
S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E 100+ COUNTRIES 55K+ EMPLOYEES $9B+ REVENUE(1) 20K+ CLIENTS $28T+ UNDERLYING FUND ACCOUNTING 848M+ CARDS PROCESSED 10B+ FINANCIAL TRADE RECORDS PROCESSED PER HOUR $800B+ HEDGE FUND ASSETS PROCESSED 36M+ MOBILE BANKING USERS 27B+ TRANSA
Slide 8: FIS Today: Solutions Covering the FinTech Landscape
Core Banking BANKING AND WEALTH Enterprise Governance, Risk and Compliance Internet Banking Mobile Banking Bill Payment CORPORATE AND DIGITAL Corporate Treasury Wealth Management Image and Output Solutions Issuer Services Network Services Prepaid Services Loyalty PAYMENTS Post-Trade Processing Globa
Slide 9: FIS Today: Global Footprint - North America
NORTH AMERICA Primary Countries • United States • Canada Key Solutions • Banking and Wealth Management • Corporate and Digital • Payments • Buy Side • Capital Markets • Trading • Capco Consulting Est. Market Size $118B* Est. CAGR ’14 –’19 5% ~$6.9B Revenue(1) 76% * 2017 Source: Ovum Technology spend
Slide 10: FIS Today: Global Footprint - EMEA
EMEA Primary Countries • United Kingdom • Germany • France Key Solutions • Banking and Wealth Management • Payments • Buy Side • Capital Markets • Trading • Capco Consulting Est. Market Size $105B* Est. CAGR ’14 –’19 4% ~$1.4B Revenue(1) 15% * 2017 Source: Ovum Technology spending through 2020 (sour
Slide 11: FIS Today: Global Footprint - Asia Pacific
ASIA PACIFIC Primary Countries • India • Thailand • Singapore • Hong Kong • Australia • Philippines Key Solutions • Banking • Payments • Capital Markets • Trading Est. Market Size $59B* Est. CAGR ’14 –’19 6% ~$500M Revenue(1) 5% * 2017 Source: Ovum Technology spending through 2020 (source segmentati
Slide 12: FIS Today: Global Footprint - Latin America
LATIN AMERICA Primary Countries • Brazil Key Solutions • Payments • Banking • Digital Est. Market Size $10B* Est. CAGR ’14 –’19 5% ~$350M Revenue(1) 4% * 2017 Source: Ovum Technology spending through 2020 (source segmentation): Financial Markets, Retail Banking, Wealth Management; Ovum Technology sp
Slide 13: FIS Today: Expanding Relationships
RELATIONSHIP HAS GROWN BY 125% Increasing IP-led revenue for GFS clients S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S FIS Today: Expanding Relationships 13
Slide 14: FIS Today: Recognized Leader
BEST PEOPLE Top 5 Best Companies to Work for in India Large Organizations FIS Captive Delivery Centers in India BEST SOLUTIONS Best of the Best in Origination IT Best of the Best in Servicing IT Global Leader Issuer Processor and Packaged Software + STRONG FOUNDATION FOR LONG-TERM GROWTH S T R A T E
Slide 15: FIS Today: Strong Historical Performance
10 11 12 13 14 15 10 11 12 13 14 15 HIGH RECURRING REVENUE(1) CONSISTENT EPS GROWTH(1) DIVIDENDS(2) (1) Adjusted (2) 3-Year CAGR (2012-2015) Refer to www.investor.fisglobal.com or the appendix attached to this presentation for a description and reconciliation of GAAP to non-GAAP items 10 11 12 13 14
Slide 16: Executing Our Strategy
Executing Our Strategy
Slide 17: Our Growth Strategy
Effectively sell, deliver and service existing clients BASE BUSINESS GROWTH EXECUTION Strategic investment to leverage solution portfolio, create new white space UNLOCK ENTERPRISE VALUE INNOVATION Continue to strategically expand solution portfolio, client base and talent ACQUISITIONS INORGANIC FINA
Slide 18: Evolving with Technology – Growing Our Base Business
PC Banking/Internet eBanking/Payments Smart Card Client Server 1990s 1991 REVENUE ~$500M 2001 REVENUE ~$1.0B Smartphones Biometrics Real Time Offshoring Paperless 2000s “With so much change in technology taking place now, it takes commitment to the industry and a sharp focus on bringing effective te
Slide 19: Our Growth Strategy
Effectively sell, deliver and service existing clients BASE BUSINESS GROWTH EXECUTION Strategic investment to leverage solution portfolio, create new white space UNLOCK ENTERPRISE VALUE INNOVATION Continue to strategically expand solution portfolio, client base and talent ACQUISITIONS INORGANIC FINA
Slide 20: Unlocking Enterprise Value: Multi-faceted Approach to Innovation
Research & Development We put ~6% of revenue back into development to fuel growth. Venture Investments Early round funding approach to invest ahead of demand bringing new solutions to early-adopter clients Disruptive Technologies By looking at a future view 5+ years out, we help forward-thinking cli
Slide 21: Our Growth Strategy
Effectively sell, deliver and service existing clients BASE BUSINESS GROWTH EXECUTION Strategic investment to leverage solution portfolio, create new white space UNLOCK ENTERPRISE VALUE INNOVATION Continue to strategically expand solution portfolio, client base and talent ACQUISITIONS INORGANIC FINA
Slide 22: SunGard Is a Natural Extension of the FIS Strategy
INCREASES offerings and new markets for whitespace ENHANCES client base with deeper relationships IMPROVES IP-led solution concentration DRIVES financial performance through synergies STRENGTHENS talent and leadership ACCRETIVE to adjusted earnings per share … ENHANCING SHAREHOLDER VALUE STRATEGIC A
Slide 23: Delivering Shareholder Value via Transformational Acquisitions
Company Acquisition Date Synergy Target ($M) Exceeded Oct. 2009 260 Sep. 2007 65 Feb. 2006 50 Dec. 2004 25 Jul. 2004 24 Mar. 2004 15 HISTORICALLY EXCEEDED TARGETS BY AN AVERAGE OF 30% ✔ ✔ ✔ ✔ ✔ ✔ Nov. 2015 200 S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T
Slide 24: Strategic Overview, Segment Updates, Shareholder Value
STRATEGIC OVERVIEW Gary Norcross President and Chief Executive Officer SEGMENT UPDATES Anthony Jabbour Co-Chief Operating Officer Marianne Brown Co-Chief Operating Officer Lance Levy Chief Executive Officer, Capco SHAREHOLDER VALUE Woody Woodall Chief Financial Officer
Slide 25: Operating Segments
Operating Segments Integrated Financial Solutions Global Financial Solutions S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S 25
Slide 26: Integrated Financial Solutions
Integrated Financial Solutions Operating Segments Key Characteristics • North American community & regional financial institutions • One-to-many outsourcing model • Highly recurring • Long-term contracts • Strong margins with continued expansion MARKET DEMANDS BROAD SOLUTION SUITE S T R A T E G I C
Slide 27: Global Financial Solutions
Global Financial Solutions Operating Segments Key Characteristics • Global and international clients • Mission critical applications • Growing trend from build to buy • Diverse markets; scale in key geographies • Higher growth potential with margin expansion SUNGARD EXPANDS IP-LED REVENUE TO ~85% S
Slide 28: Leadership Introductions
Leadership Introductions ANTHONY JABBOUR Co-Chief Operating Officer Global accountability for solution development, sales and delivery of banking and payments offerings. Joined FIS in 2004. Prior to FIS, held executive leadership positions at IBM Global Services Group and CIBC. MARIANNE BROWN Co-Chi
Slide 29: Integrated Financial Solutions
Integrated Financial Solutions Anthony Jabbour, Co-Chief Operating Officer
Slide 30: Integrated Financial Solutions (IFS) Today
Integrated Financial Solutions (IFS) Today INTEGRATED FINANCIAL SOLUTIONS ~40% EBITDA MARGIN CONTRIBUTED(1) ~$4.3B REVENUES(1) ~86% RECURRING REVENUES(1) (1) FY 2015 Adj. Combined Refer to www.investor.fisglobal.com or the appendix attached to this presentation for a description and reconciliation o
Slide 31: Integrated Financial Solutions (IFS) Today
INTEGRATED PLATFORM provider to U.S. community and regional FIs ONE-to-MANY significant operating leverage HIGHLY RECURRING long-term contracts STRONG MARGINS with continued expansion Integrated Financial Solutions (IFS) Today ~40% EBITDA MARGIN CONTRIBUTED(1) ~$4.3B REVENUES(1) ~86% RECURRING REVEN
Slide 32: Integrated Financial Solutions (IFS) Today
INTEGRATED PLATFORM provider to U.S. community and regional FIs ONE-to-MANY significant operating leverage HIGHLY RECURRING long-term contracts STRONG MARGINS with continued expansion Integrated Financial Solutions (IFS) Today MOST COMPLETE SOLUTION SET POSITIONED TO BENEFIT FROM MARKET TRENDS ~14,0
Slide 33: Key Domains and Solutions
EXAMPLE REVENUE DRIVERS: Core Accounts Processed 42M Outsourced Core Accounts Core Banking Image and Output Solutions Enterprise Governance, Risk and Compliance Wealth Management BANKING & WEALTH REVENUE ~$1.9B(1) INTEGRATED FINANCIAL SOLUTIONS S T R A T E G I C O V E R V I E W S H A R E H O L D E R
Slide 34: Key Domains and Solutions
EXAMPLE REVENUE DRIVERS: Core Accounts Processed Payment Volumes (Debit/Credit) 42M Outsourced Core Accounts $5.6T Annual Money Movement 370M Cards Issuer Services Network Services Prepaid Services Loyalty PAYMENTS REVENUE ~$1.7B(1) Core Banking Image and Output Solutions Enterprise Governance, Risk
Slide 35: Key Domains and Solutions
EXAMPLE REVENUE DRIVERS: Core Accounts Processed Payment Volumes (Debit/Credit) 42M Outsourced Core Accounts $5.6T Annual Money Movement 370M Cards Mobile Banking Accounts 36M+ Mobile Users Mobile Banking Internet Banking Bill Payment Corporate Treasury CORPORATE & DIGITAL REVENUE ~$750M(1) Issuer S
Slide 36: Market Dynamics
Run the Bank • Modernize systems and processes • Improve efficiencies • Managed IT • Risk, compliance and information security Grow the Bank • Digital and analytics • Wealth management • Treasury MARKET DRIVERS INTEGRATED FINANCIAL SOLUTIONS S T R A T E G I C O V E R V I E W S H A R E H O L D E R V
Slide 37: Market Dynamics
Run the Bank • Modernize systems and processes • Improve efficiencies • Managed IT • Risk, compliance and information security Grow the Bank • Digital and analytics • Wealth management • Treasury MARKET DRIVERS FIS GROWTH LEVERS Increase core market share Leverage existing client relationships to cr
Slide 38: Market Dynamics
Run the Bank • Modernize systems and processes • Improve efficiencies • Managed IT • Risk, compliance and information security Grow the Bank • Digital and analytics • Wealth management • Treasury MARKET DRIVERS FIS GROWTH LEVERS Increase core market share Leverage existing client relationships to cr
Slide 39: Empowerment in Action
RISK-AS-A-SERVICE Leveraging FIS’ internal investments over the last four years; delivering clients a managed service solution for risk and compliance ENABLING COMPLIANCE DATA & ANALYTICS SOLUTIONS Providing core clients with a holistic view of customers, targeting analytics, real-time reporting and
Slide 40: Empowering Growth Through Market Leadership
• Community bank based in the Midwest • Win based upon FIS’ full digital offering spanning internet banking and mobile fully integrated with billpay, money movement and remote deposit. • Complete integration from a single provider was the key differentiator, replacing several third-party and interna
Slide 41: IFS: Recurring Revenues, Margin Expansion, Growth Levers
Long-term recurring contracts and sticky relationships as replacement is a major business disruption. Clients rely on FIS expertise companion services – implementations, integration and upgrades. HIGHLY RECURRING REVENUES Increase adoption and transaction volumes in high- margin businesses Continued
Slide 42: Global Financial Solutions
Global Financial Solutions Marianne Brown, Co-Chief Operating Officer Lance Levy, Chief Executive Officer, Capco
Slide 43: Global Financial Solutions (GFS) Today
Global Financial Solutions (GFS) Today ~27% EBITDA MARGIN CONTRIBUTED(1) ~$4.1B REVENUES(1) ~85% IP-CENTRIC REVENUES(1) (1) FY 2015 Adj. Combined Refer to www.investor.fisglobal.com or the appendix attached to this presentation for a description and reconciliation of GAAP to non-GAAP items S T R A T
Slide 44: Global Financial Solutions (GFS) Today
Global Financial Solutions (GFS) Today MISSION CRITICAL IP-led solutions; driving sales momentum LEVERAGE portfolio; build once and package LOCALIZE for market; create solution passports SCALE is substantial; built from investments ~27% EBITDA MARGIN CONTRIBUTED(1) ~$4.1B REVENUES(1) ~85% IP-CENTRIC
Slide 45: Global Financial Solutions (GFS) Today
Global Financial Solutions (GFS) Today IMPROVED REVENUE QUALITY MARGIN EXPANSION OPPORTUNITY MARKET DIVERSITY DE-RISK CLIENT CONCENTRATION MISSION CRITICAL IP-led solutions; driving sales momentum LEVERAGE portfolio; build once and package LOCALIZE for market; create solution passports SCALE is subs
Slide 46: Key Domains and Solutions
Key Domains and Solutions BANKING AND PAYMENTS REVENUE ~$1.6B(1) Banking Payments CONSULTING REVENUE ~550M(1) North America Europe INSTITUTIONAL AND WHOLESALE REVENUE ~$2.0B(1) Buy Side Capital Markets Global Trading LEVERAGE SOLUTIONS AND LOCALIZE IN STRATEGIC MARKETS (1) FY 2015 Adj. Combined Refe
Slide 47: Key Domains and Solutions
Core Banking Channel Issuer Services Prepaid BANKING AND PAYMENTS S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S Key Domains and Solutions 47 GLOBAL FINANCIAL SOLUTIONS
Slide 48: Key Domains and Solutions
Core Banking Channel Issuer Services Prepaid BANKING AND PAYMENTS Fund Accounting Middle Office Risk Management Private Equity Reconciliation BUY SIDE CAPITAL MARKETS Back Office Processing Risk and Compliance Tax Reporting Securities Finance and Collateral Corporate Actions Trade Execution Order Ma
Slide 49: Key Domains and Solutions
CUSTOMERS SERVED: Banks | Investment Banks | Asset Managers | Hedge Funds | Private Equity | Trading Desks Core Banking Channel Issuer Services Prepaid BANKING AND PAYMENTS Fund Accounting Middle Office Risk Management Private Equity Reconciliation BUY SIDE CAPITAL MARKETS Back Office Processing Ris
Slide 50: Key Domains and Solutions
SOLUTIONS FIT FOR PURPOSE ACROSS GLOBAL FINANCIAL SERVICES LANDSCAPE CUSTOMERS SERVED: Banks | Investment Banks | Asset Managers | Hedge Funds | Private Equity | Trading Desks Core Banking Channel Issuer Services Prepaid BANKING AND PAYMENTS Fund Accounting Middle Office Risk Management Private Equi
Slide 51: GFS – Institutional and Wholesale
GFS – Institutional and Wholesale BUY SIDE CAPITAL MARKETS GLOBAL TRADING CAPABILITIES OPERATING LEVERAGE DRIVING ROBUST MARGIN EXPANSION RECORD KEEPING AND INVESTMENT ACCOUNTING TRADE ENABLEMENT SECURITIES, FUTURES & TRANSACTION PROCESSING RISK MEASUREMENT AND MANAGEMENT REGULATORY REPORTING AND CO
Slide 52: Serving Clients across the Spectrum of Financial Services
CONSUMER/ COMMERCIAL BANKING CAPITAL MARKETS/ INSTITUTIONAL EMPOWERING THE FINANCIAL WORLD S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S Serving Clients across the Spectrum of Financial Services 52 GLOBAL FINANCIAL SOLUTIONS
Slide 53: Growth through Client Empowerment
• Integrated three FIS solutions: Corporate Actions, Fund Accounting and Collateral • Aligned superior technology with streamlined operations to achieve cost efficiencies CROSS SELL Tier 1 Multinational Investment Firm S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U
Slide 54: Growth through Client Empowerment
• Integrated three FIS solutions: Corporate Actions, Fund Accounting and Collateral • Aligned superior technology with streamlined operations to achieve cost efficiencies CROSS SELL Tier 1 Multinational Investment Firm • Post-trade derivatives processing and related services • FIS’ IP and deep subje
Slide 55: Growth through Client Empowerment
FINANCIAL INCLUSION • FIS’ second new bank implementation in India • Combines FIS core solutions with innovative hand-held field force enablement technology to bring banking to rural consumers • Integrated three FIS solutions: Corporate Actions, Fund Accounting and Collateral • Aligned superior tech
Slide 56: Growth through Client Empowerment
FINANCIAL INCLUSION • FIS’ second new bank implementation in India • Combines FIS core solutions with innovative hand-held field force enablement technology to bring banking to rural consumers • Integrated three FIS solutions: Corporate Actions, Fund Accounting and Collateral • Aligned superior tech
Slide 57: Play Atom video
Play Atom video S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S 57 GLOBAL FINANCIAL SOLUTIONS
Slide 58: Global Financial Solutions: Mission Critical Systems
Account processing and record keeping for buy side and capital markets Account processing and payments for international financial institutions Long-term client relationships MISSION CRITICAL SYSTEMS S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S Global
Slide 59: Global Financial Solutions: Recurring Revenues
Account processing and record keeping for buy side and capital markets Account processing and payments for international financial institutions Long-term client relationships MISSION CRITICAL SYSTEMS Highly renewable – sticky applications Strong pull-through of companion solutions and services Recur
Slide 60: Global Financial Solutions: Margin Expansion
Account processing and record keeping for buy side and capital markets Account processing and payments for international financial institutions Long-term client relationships MISSION CRITICAL SYSTEMS Highly renewable – sticky applications Strong pull-through of companion solutions and services Recur
Slide 61: Global Financial Solutions: Growth Levers
Account processing and record keeping for buy side and capital markets Account processing and payments for international financial institutions Long-term client relationships MISSION CRITICAL SYSTEMS Highly renewable – sticky applications Strong pull-through of companion solutions and services Recur
Slide 62: Global Financial Solutions
Account processing and record keeping for buy side and capital markets Account processing and payments for international financial institutions Long-term client relationships MISSION CRITICAL SYSTEMS Highly renewable – sticky applications Strong pull-through of companion solutions and services Recur
Slide 63: Global Financial Solutions: Capco
Global Financial Solutions Marianne Brown, Co-Chief Operating Officer Lance Levy, Chief Executive Officer, Capco
Slide 64: GFS Consulting – Capco Today
GFS Consulting – Capco Today Shared clients and complementary focus on key domains and growth segments support growth of FIS Deep domain experience, thought leadership and unique culture ~$550M REVENUES (1) (1) FY 2015 Adj. Combined Refer to www.investor.fisglobal.com or the appendix attached to thi
Slide 65: GFS Consulting – Capco Today
GFS Consulting – Capco Today KEY DOMAINS SERVED Retail Banking and Distribution | Commercial and SME Corporate and Institutional | Wealth BANKING AND PAYMENTS Post-Trade Operations | Finance, Risk and Treasury Buy Side | Sourcing Solutions INSTITUTIONAL AND WHOLESALE Shared clients and complementary
Slide 66: GFS Consulting – Capco Today
GFS Consulting – Capco Today DIGITAL Defining Strategies Creating Experiences Delivering Platforms Analytics Next Generation Technology CAPABILITIES AND SOLUTIONS SOURCING SOLUTIONS Complex Transition Leadership Utilities Run Services Training and Development TECHNOLOGY IT Strategy & Solution Archit
Slide 67: Capco Journey
Capco Journey 2013 – 2015 EXPANSION 2012 CAPITAL MARKETS ADVISORY 2016 FOCUSED GROWTH Thought Leadership. Innovation. Change. Transformation. S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S Evolution from thought leadership niche provider, to focused, hi
Slide 68: Capco Journey
Capco Journey 2013 – 2015 EXPANSION 2012 CAPITAL MARKETS ADVISORY 2016 FOCUSED GROWTH Thought Leadership. Innovation. Change. Transformation. Refocus on high-value consulting Independent, focused and collaboration with FIS Thought leadership and transformation capability Disciplined global sales and
Slide 69: Growth through Client Empowerment
LONG-STANDING FIS CLIENT LAUNCHING DIGITAL BANK AIMED AT MILLENNIALS Client strategy to launch new digital mobile-only bank Client intimacy through thought leadership, deep domain expertise and agile operational approach STRONG FOUNDATIONS HIGH IMPACT Bespoke, innovative digital platform, designed a
Slide 70: Strategic Overview, Segment Updates, Shareholder Value
STRATEGIC OVERVIEW Gary Norcross President and Chief Executive Officer SEGMENT UPDATES Anthony Jabbour Co-Chief Operating Officer Marianne Brown Co-Chief Operating Officer Lance Levy Chief Executive Officer, Capco SHAREHOLDER VALUE Woody Woodall Chief Financial Officer
Slide 71: Shareholder Value
SHAREHOLDER VALUE Woody Woodall | Chief Financial Officer
Slide 72: Shareholder Value: Topics
SHAREHOLDER VALUE Woody Woodall Chief Financial Officer FIS BUSINESS MODEL OPERATING SEGMENTS CAPITAL ALLOCATION 2016 – 2018 OUTLOOK WHY INVEST IN FIS?
Slide 73: FIS Business Model: Maximizes Industry Opportunity
FIS Business Model: Maximizes Industry Opportunity Industry Characteristics Investors Value FIS Long-term Contracts Mission Critical Applications Cash Flow Generation Consistent Earnings Growth IP-centric Solution Set S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G
Slide 74: FIS Business Model: Compelling Business Model
FIS Business Model: Compelling Business Model High-quality revenue Strong cash generation Sustainable EPS growth Expanding margins SunGard fits these qualities S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S 74
Slide 75: Operating Segments: IFS
• Revenue from long-term contractual relationships • Need for increased use of technology to remain competitive • Leveraged scale drives industry- leading margins Drivers of Growth ~86% RECURRING REVENUES ~40% EBITDA MARGIN CONTRIBUTED ~$4.3B REVENUES ONE-to- MANY HIGH INCREMENTAL MARGINS Refer to w
Slide 76: Operating Segments: GFS
• Compelling value proposition of combined intellectual property and professional services • Increase in technology spending is attributed to growing client need for efficiencies • Operational excellence plus synergies drive margin expansion Drivers of Growth ~85% IP-LED REVENUE ~70% RECURRING REVEN
Slide 77: Operating Segments: Corporate and Other
The Corporate and Other segment is inclusive of corporate expenses of $342M. Adj. Combined FY 2015 Revenue $ 651M EBITDA $ (189)M Public Sector & Education 36% Commercial Services 43% Retail Check Processing 21% C&O Revenue Composition ~7% TOTAL FIS REVENUE S T R A T E G I C O V E R V I E W S H A R
Slide 78: Capital Allocation: Consistent Capital Allocation Practices
Capital Allocation: Consistent Capital Allocation Practices • Aggressively pay down debt • Preserve investment grade credit ratings Strong Balance Sheet Investing for Growth • Internal investment for organic growth • Acquisitions accretive to future EPS growth Return Capital to Shareholders • Contin
Slide 79: Capital Allocation: Commitment to Debt Reduction
$4.8 $4.4 $4.5 $5.1 $11.4(1) 2.8 2.4 2.4 2.6 ~4.0 ~2.5 2011 2012 2013 2014 2015 2016 2017 Total Debt Leverage Ratio(2) (1) December 31, 2015 debt is adjusted to include debt issuance costs. Per FASB issued Accounting Standard Update 2015-03, as of January 2016, debt issuance costs are recorded as a
Slide 80: Capital Allocation: M&A Principles
Capital Allocation: M&A Principles Create Long-term Shareholder Returns • Buy products to cross sell/ up sell • Expand market opportunities • Gain additional operational scale STRATEGIC RATIONALE • Risk-adjusted returns meet strategic criteria • Solid financial performance and outlook • Accretive to
Slide 81: Capital Allocation: SunGard Integration Overview
Capital Allocation: SunGard Integration Overview INTEGRATION PLAYBOOK Internal value enhancements • External vendor savings • Scale of organizational structures Enhance operating model • Global delivery model • Sales force and marketing efficiency Leveraged infrastructure • Data center consolidation
Slide 82: 2016 – 2018 Financial Outlook: Integrated Financial Solutions
2016 – 2018 Financial Outlook: Integrated Financial Solutions (IFS) Current revenue mix continues Macro-economic softness (payment volumes) Accelerated bank consolidation Softness in professional services Cross-sale and up-sale execution FinTech macro spend exceeds expectations Enhanced growth in mo
Slide 83: 2016 – 2018 Financial Outlook: Global Financial Solutions
2016 – 2018 Financial Outlook: Global Financial Solutions (GFS) Negative revenue mix-shift e.g., accelerated Consulting growth Professional services volatility continues Ongoing weakness of global economy Lack of revenue synergies Ramp in Consulting recovery Improved international markets Revenue sy
Slide 84: Consolidated FIS Outlook: 2016 – 2018
Consolidated FIS Outlook: 2016 – 2018 2016 – 2018 Outlook ANNUAL Organic Revenue 3% to 7% EBITDA Margin Expansion (synergies included) 75 to 125 bps Adjusted Net Earnings(1) 13% to 18% S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U P D A T E S (1) Refers to Adjuste
Slide 85: Consolidated FIS Outlook: Earnings Growth Drivers
Consolidated FIS Outlook: 2016 – 2018 Earnings Growth Drivers 3% - 7% 13% - 18% ~6% ~2% 2% - 3% Organic Revenue Growth Margin Expansion Debt Paydown Effective Tax Rate Reduction Adjusted Net Earnings Growth Implied 2018 EPS: $4.70 - $5.10 (BAU + Synergies) (1) S T R A T E G I C O V E R V I E W S H A
Slide 86: Why Invest in FIS?: Attractive Valuation Relative to Peers
3 YEAR PRICE / EARNINGS VALUATION DISCOUNT Why Invest in FIS?: Attractive Valuation Relative to Peers • FIS valued at 20% discount to Peer Average • Valuation trending positively • Focus on consistent quality earnings growth to drive long-term shareholder value Source: 5/4/16 FactSet, Peer Group of
Slide 87: Why Invest in FIS?: Positioned for Long-term Shareholder Returns
Why Invest in FIS?: Positioned for Long-term Shareholder Returns STRONG CASH FLOW GENERATION CONTINUED MARKET LEADERSHIP HIGH-QUALITY RECURRING REVENUE COMPELLING VALUATION GAP PREDICTABLE AND CONSISTENT EPS GROWTH Q&A S T R A T E G I C O V E R V I E W S H A R E H O L D E R V A L U E S E G M E N T U
Slide 88: Why Invest in FIS?
Why Invest in FIS? DEEP CLIENT RELATIONSHIPS DIVERSIFIED MARKETS SOLUTION AND DELIVERY SCALE INVESTMENT IN INNOVATION MISSION CRITICAL SYSTEMS COMPETITIVE DIFFERENTIATION • PREDICTABLE GROWTH • DIVERSIFICATION • LOWER RISK 88
Slide 89: 2016 Investor Conference
HIS 2016 INVESTOR CONFERENCE
Slide 90: 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 Company, business and market
Slide 91: Forward-looking statement risk factors
• 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; • ch
Slide 92: Non-GAAP measures definitions
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 transactions and in the preparation of financial statements.
Slide 93: Non-GAAP measures definitions
Adjusted revenue includes reported revenue and is increased to adjust for the purchase accounting deferred revenue adjustment 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
Slide 94: Non-GAAP measures definitions
EBITDA reflects earnings from continuing operations before interest, taxes, depreciation and amortization. Constant currency revenue is reported revenue excluding the impact of fluctuations in foreign currency exchange rates in the current period. Organic revenue growth includes reported revenue, ad
Slide 95: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted Combined (In millions) Year ended December 31, 2015 Integrated Global Financial Financial Corporate Solutions Solutions and Other Consolidate
Slide 96: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted Revenue For the Years ended 2010-2015 (In millions) 2015 2014 2013 2012 2011 2010 Processing and services revenues 6595.2 6,413.8 6,063.4 5,7
Slide 97: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted EPS (In millions) Year ended December 31, 2015 Acquisition, Acquisition Integration, Deferred and Sale of Purchase Revenue Severance Gaming G
Slide 98: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted EPS (In millions) Year ended December 31, 2014 Acquisition, Integration, and Purchase Severance Refinance Contract Price GAAP Costs Costs Set
Slide 99: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted EPS (In millions) Year ended December 31, 2013 Capco International Purchase Acquisition Refinance Restructuring Gain on Price GAAP Adjustment
Slide 100: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted EPS (In millions) Year ended December 31, 2012 Stock and Purchase Other Compensation Refinance Price GAAP Charges Costs Subtotal Amort. Non-G
Slide 101: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted EPS (In millions) Year ended December 31, 2011 Purchase Capco Refinance Investment Price GAAP Adjustment Costs Impairment Subtotal Amort. Non
Slide 102: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures (in Millions, Except Per Share Data) (Unaudited) GAAP to Non-GAAP Reconciliation - Consolidated Adjusted EPS (In millions) Year ended December 31, 2010 M&A Acquisition Restructuring Deferred Purchase & Integration Brazilian Revenue Price GAAP Cos
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