Fidelity National Information Services, Inc. · NYSE:FIS
Fidelity National Information Services — Q1 2022 Earnings Presentation
30 slides from Fidelity National Information Services's earnings presentation, May 3, 2022
Slide 1: First Quarter 2022 Earnings Call
FIRST QUARTER 2022 EARNINGS CALL May 3, 2022
Slide 2: Speakers
SPEAKERS BUSINESS & Gary Norcross STRATEGY Chairman and Chief Executive Officer UPDATE OPERATING [] PERFORMANCE Stephanie Ferris President 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 Start to the Year
STRONG START TO THE YEAR TOTAL REVENUE ADJUSTED EPS AND ADJ. EBITDA MARGIN BACKLOG GROWTH $3.5B $1.47 40.6% $22.5B 9% ORGANIC 13% 8% ORGANIC GROWTH SEGMENT PERFORMANCE BANKING SOLUTIONS MERCHANT SOLUTIONS CAPITAL MARKETS ORGANIC REVENUE GROWTH: 7% 15% 6% $1,645M $1,112M $658M ADJ. EBITDA MARGIN: 42%
Slide 6: Enhanced Capabilities Across the Enterprise
ENHANCED CAPABILITIES ACROSS THE ENTERPRISE Next-generation solution suites built for agility and resiliency CAPITAL BANKING MERCHANT MARKETS Modern Banking Platform Direct USDC Settlement Crypto: Fireblocks Partnership Accelerating international expansion Partnership with Circle to enable fit- Effi
Slide 7: Operating Performance
OPERATING PERFORMANCE
Slide 8: Banking Solutions
BANKING SOLUTIONS Strategic technology investment and differentiated competitive position Key Metrics Notable Client Wins Issuer Processing Top 20 US Financial Institution +7% ~42% • Payments One agreement for debit processing and card production Organic Wealth Management Revenue Adj. EBITDA Growth
Slide 9: Capital Markets
CAPITAL MARKETS Leading end-to-end solutions and growing mix of SaaS-based recurring revenue Key Metrics Notable Client Wins Transfer Agency Services >$1T AUM Financial Services Company +6% ~47% • As a service offering builds on recent Franklin Templeton signing Organic Investment Operations Suite H
Slide 10: Merchant Solutions
MERCHANT SOLUTIONS Leading global eCommerce and software-led capabilities Key Metrics Notable Client Wins Payrix +15% ~47% Organic Global eCommerce Revenue Adj. EBITDA Growth Margin • Significant new client building off strength and reputation in crypto vertical FY21 US Volume Share Gained WHY WHY W
Slide 11: Merchant Sub-Segments
MERCHANT SUB-SEGMENTS Balanced growth across all client types to start out the year Merchant 27% 45% 28% Revenue Mix Global Enterprise Software-led eCommerce SMB A leading global Digital only merchants Physical or Omnichannel Small merchants with merchant acquirer and Payrix leveraging merchants inc
Slide 12: Financial Results & Guidance
FINANCIAL RESULTS & GUIDANCE
Slide 13: 1Q 2022 Financial Results
1Q 2022 FINANCIAL RESULTS CONSOLIDATED FINANCIAL RESULTS REVENUE ($ in millions) • Revenue increased 9% on an organic basis to $3,492 million 1Q22 $3,492 reflecting strength across all operating segments • Adjusted EBITDA increased 8% to $1,418 with Adj. EBITDA margin flat at 41%, and Adjusted EPS g
Slide 14: Balance Sheet and Free Cash Flow
BALANCE SHEET AND FREE CASH FLOW RETURN OF CAPITAL 1Q 2022 STRONG BALANCE SHEET 1Q 2022 Free Cash Flow $786M Total Debt $19.2B Dividends Paid $287M Weighted Average Interest Rate 1.0% (1) Debt Reduction $(1.2)B Leverage Ratio 3.0x 1Q 2022 Highlights: • Free cash flow increased 41% year-over-year as
Slide 15: 2Q and Full Year 2022 Guidance
2Q AND FULL YEAR 2022 GUIDANCE ($ millions, except per share data) METRICS 2Q 2022 FY 2022 Revenue $3,650 - $3,685 $14,780 - $14,925 Organic Revenue Growth 6% - 7% 7% - 9% Adjusted EBITDA $1,600 - $1,620 $6,625 - $6,700 Adjusted EBITDA Margin ~44% ~45% Adjusted EPS $1.72 - $1.75 $7.25 - $7.37 Year-o
Slide 16: Appendix Slides
APPENDIX SLIDES
Slide 17: 2Q 2022 Guidance – Additional Assumptions
2Q 2022 GUIDANCE – ADDITIONAL ASSUMPTIONS ($ millions) METRICS 2Q 2022 GUIDANCE Negative F/X Impact to Revenue ~$35 Corporate and Other Revenue ~$75 Depreciation and Amortization ~$310 (Excluding Purchase Price Amortization) Net Interest Expense ~$45 Effective Tax Rate ~15.0% Weighted Average Shares
Slide 18: FY 2022 Guidance – Additional Assumptions
FY 2022 GUIDANCE – ADDITIONAL ASSUMPTIONS ($ millions) METRICS FY 2022 GUIDANCE Negative F/X Impact to Revenue ~$115 Corporate and Other Revenue ~$305 Depreciation and Amortization ~$1,230 (Excluding Purchase Price Amortization) Net Interest Expense ~$190 - $200 Effective Tax Rate ~15.0% Weighted Av
Slide 19: Merchant Volume Growth Compared to Networks
MERCHANT VOLUME GROWTH COMPARED TO NETWORKS FIS year-over-year growth tracking closely in-line with networks GLOBAL VOLUME GROWTH 50% 35% 40% 30% 17% 17% 12% 10% 20% 4% 5% 6% 5% 5% 5% 10% -1% 0% -8% -10% -20% 1Q 2019 2Q 2019 3Q 2019 4Q 2019 1Q 2020 2Q 2020 3Q 2020 4Q 2020 1Q 2021 2Q 2021 3Q 2021 4Q
Slide 20: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation and today’s webcast contain “forward-looking statements” within the meaning of the U.S. federal securities laws. Statements that are not historical facts, including statements about anticipated financial outcomes, including any earnings guidance or projec
Slide 21: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS • competitive pressures on pricing related to the decreasing number of community banks in the U.S., the development of new disruptive technologies competing with one or more of our solutions, increasing presence of international competitors in the U.S. market and the entry
Slide 22: FIS Use of Non-GAAP Financial Information
FIS USE OF NON-GAAP FINANCIAL INFORMATION Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting in the United States. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizi
Slide 23: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2022 MERCHANT BANKING CAPITAL MARKET CORPORATE TOTAL SOLUTIONS SOLUTIONS SOLUTIONS AND OTHER Revenue $1,112 $1,645 $658 $77 $3,492 FX 12 5 5 1 23 Constant Currency Revenue $1,124 $1,650 $663 $78 $3,514
Slide 24: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2022 Net cash provided by operating activities $896 Non-GAAP adjustments: Acquisition, integration and other payments (1) 136 Settlement activity 162 Adjusted cash flows from operations $1,194 Capital
Slide 25: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2022 2021 Net earnings (loss) attributable to FIS common stockholders $120 $(373) Provision (benefit) for income taxes 54 (97) Interest expense, net 43 74 Other, net (60) 495 Operating income, as repor
Slide 26: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ millions, unaudited) THREE MONTHS ENDED MARCH 31, 2022 2021 Earnings (loss) before income taxes and equity method investment earnings (loss) $175 $(468) (Provision) benefit for income taxes (54) 97 Equity method investment earnings (loss) - 1 Net (ear
Slide 27: Notes to Unaudited Supplemental GAAP to Non-GAAP Reconciliations
NOTES TO UNAUDITED - SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS (1) This item represents purchase price amortization expense on all intangible assets acquired through various Company acquisitions, including customer relationships, contract value, technology assets, trademarks and trade names. For
Slide 28: Reconciliation of GAAP to Non-GAAP Financials
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ($ billions, unaudited) MARCH 31, 2022 2021 CHANGE GROWTH (1) Backlog (2) $22.5 $21.0 $1.5 8% Organic Adjustments (3) - Organic Backlog 8% (1) Backlog growth percentage may not calculate due to rounding. (2) Backlog reflects the approximate transaction p
Slide 29: Reconciliation of GAAP to Non-GAAP Financials on Guidance
RECONCILIATION OF GAAP TO NON-GAAP FINANCIALS ON GUIDANCE (unaudited) THREE MONTHS ENDED TWELVE MONTHS ENDED JUNE 30, 2022 DECEMBER 31, 2022 LOW HIGH LOW HIGH Net earnings per share-diluted attributable to FIS common stockholders $0.40 $0.50 $2.10 $2.50 Estimated adjustments (1) $1.32 $1.25 $5.15 $4
Slide 30: Advancing the Way the World Pays, Banks and Invests
(— | — ADVANCING THE WAY THE WORLD PAYS, BANKS AND INVESTS™
Fidelity National Information Services — Q1 2022 Earnings Presentation on 6ix