Fidelity National Information Services, Inc. · NYSE:FIS
Fidelity National Information Services — Q1 2020 Earnings Presentation
25 slides from Fidelity National Information Services's earnings presentation, May 7, 2020
Slide 1: First Quarter 2020 Earnings Call
FIRST QUARTER 2020 EARNINGS CALL May 7, 2020
Slide 2: Speakers
SPEAKERS Gary Norcross Chairman, President and CEO Business Update Woody Woodall Chief Financial Officer 1Q 2020 Results
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 Update
His BUSINESS UPDATE
Slide 5: COVID-19 Response
COVID-19 RESPONSE • Equipped more than 95% of colleagues to ‘Work from Home’ Colleagues • Extended sick leave for employees affected by COVID-19 • Expanded availability of telemedicine to employees globally • Broadened FIS Cares, our employee funded charity, to benefit employees-in-need around the w
Slide 6: Durable Business Model
DURABLE BUSINESS MODEL FIS is well positioned to navigate uncertainty HIGHLY RECURRING EXPOSURE TO NON- ENHANCING STRONG BALANCE REVENUE MODEL CYCLICAL MARKETS PROFITABILITY SHEET • Mission-critical • Leading technology • Integration ahead • Ample liquidity applications solutions provider to of sche
Slide 7: Long-Term Growth Strategy
LONG-TERM GROWTH STRATEGY Advancing the way the world by applying our powerful pays, banks and invests … client value proposition Pay ACCESS TO INNOVATION WORLD-CLASS SCALE Invest Bank DATA AND INSIGHTS 7
Slide 8: Our Clients Are Responding
OUR CLIENTS ARE RESPONDING CAPITAL BANKING MERCHANT MARKETS FIS Modern Global Leading Financial Banking Platform Brand Services Company 1) European Bank Consolidating multiple Hosting commercial acquirers onto one lending in FIS’ private 2) Premier Investment platform cloud Bank Specialty Large Fina
Slide 9: 1Q 2020 Results
His 1Q 2020 RESULTS
Slide 10: 1Q 2020 Accomplishments
1Q 2020 ACCOMPLISHMENTS 1Q 2020 RESULTS IMPACTED BY COVID-19 Revenue ($ in millions) • Organic revenue grew 2%, including ~1 point headwind 1Q20 $3,078 from 1Q19 non-recurring revenue ‒ Banking reported 1% organic growth, including ~2 point headwind from 1Q19 non-recurring revenue 1Q19 $2,057 ‒ Merc
Slide 11: Integration Ahead of Schedule
INTEGRATION AHEAD OF SCHEDULE ($ millions, annual run-rate achievement) Revenue Synergy Update1 Cost Synergy Update1 $500M Total YE 2022 Increasing Target Goal of $550M to at least $700M $600M by YE 2020 $400M ~$580M Achieved in 1Q 2020 $300M $400M $200M Total YE 2020 Target of $200M $200M $100M ~$1
Slide 12: Highly Recurring Revenue Model
HIGHLY RECURRING REVENUE MODEL FIS SEGMENT REVENUE Banking Solutions MIX1 Recurring revenue: Little to no impact expected for outsourced unit-based revenue; Impact expected for ~13% 83% 17% transaction-related 20% Professional services and non- recurring revenue: Some impact expected 46% Merchant So
Slide 13: Disciplined Execution
DISCIPLINED EXECUTION • Innovation and next-gen technology Enhance On-Going • Growing sales force to reflect Long-term Investment market demand Growth • Implementation and delivery • Hiring freeze for non-revenue generating employees Protect Temporary • Travel and discretionary Near-term Cost Action
Slide 14: Strong Balance Sheet and Liquidity Profile
STRONG BALANCE SHEET AND LIQUIDITY PROFILE ($ in billions) March 31, 2020 Cash $1.4 (1) Available Borrowing Capacity $1.6 Total Liquidity $3.0 Investment Grade Credit Ratings Baa2/BBB Next bond maturity: €500M in 1Q 2021 (1) $5.5 billion revolving credit facility less outstanding commercial paper an
Slide 15: Advancing the Way the World Pays, Banks and Invests
eee (— | oS ADVANCING THE WAY THE WORLD PAYS, BANKS AND INVESTS.
Slide 16: Appendix
APPENDIX KIS
Slide 17: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation and today’s webcast contain “forward-looking statements” within the meaning of the U.S. federal securities laws. Statements that are not historical facts, including statements about anticipated financial outcomes, including any earnings guidance of the Co
Slide 18: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS • the effect of legislative initiatives or proposals, statutory changes, governmental or other applicable regulations and/or changes in industry requirements, including privacy and cybersecurity laws and regulations; • the risks of reduction in revenue from the elimination
Slide 19: FIS Use of Non-GAAP Financial Information
FIS USE OF NON-GAAP FINANCIAL INFORMATION Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting in the United States. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizi
Slide 20: FIS Use of Non-GAAP Financial Information
FIS USE OF NON-GAAP FINANCIAL INFORMATION Adjusted net earnings excludes the impact of certain costs and other transactions which management deems non-operational in nature, the removal of which improves comparability of operating results across reporting periods. It also excludes the impact of acqu
Slide 21: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP ($ millions, unaudited) Revenue Q2 2019 Q3 2019 Q4 2019 FY 2019 Merchant Solutions $ 97 $ 705 $ 1,090 $ 1,942 Banking Solutions 1,357 1,444 1,498 5,671 Capital Market Solutions 594 611 669 2,447 Corporate and Other 65 62 84 272 Consolidated FIS $ 2,112 $ 2,822 $ 3,
Slide 22: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP ($ millions, unaudited) Three months ended March 31, 2020 Capital Merchant Banking Market Corporate Solutions Solutions Solutions and Other Total Revenue $ 935 $ 1,462 $ 631 $ 50 $ 3,078 FX 4 9 3 - 16 Constant Currency Revenue $ 939 $ 1,471 $ 633 $ 50 $ 3,094 Three
Slide 23: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP ($ millions, unaudited) Three months ended March 31, 2020 2019 Net earnings attributable to FIS common stockholders $ 15 $ 148 Provision (benefit) for income taxes (30) 32 Interest expense, net 80 75 Other, net 43 60 Operating income, as reported $ 108 $ 315 Deprec
Slide 24: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP ($ millions, except per share amounts, unaudited) Three months ended March 31, 2020 2019 Earnings (loss) before income taxes and equity method investment earnings (loss) $ (11) $ 188 Provision (benefit) for income taxes (30) 32 Equity method investment earnings (lo
Slide 25: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP ($ millions, unaudited) Three months ended March 31, 2020 Net cash provided by operating activities $ 383 Non-GAAP adjustments: Acquisition, integration and other payments 91 Settlement activity 368 Adjusted cash flows from operations $ 842 Capital expenditures (30
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