JACKSONVILLE, Fla.--(BUSINESS WIRE)--FIS™ (NYSE:FIS), a global leader in financial services technology, today reported its second quarter 2019 results and also reported second quarter 2019 results for Worldpay, Inc. (Worldpay) following the July 31, 2019 acquisition of Worldpay by FIS.
FIS Second Quarter 2019 Results
“We are very pleased with our strong quarter, which was underpinned by robust sales and continued operational execution,” said Gary Norcross, FIS chairman, president and chief executive officer. “Our recent closing of the Worldpay acquisition is a demonstrable proof point in our overall growth strategy. We are confident that our focus on innovating with purpose to advance the way the world pays, banks and invests will continue to deliver long-term value to our clients and shareholders.”
On a GAAP basis, revenue was flat at $2,112 million from $2,106 million in the prior year quarter driven by solid growth in the continuing operations, partially offset by the impact of divestitures in 2018. Net earnings attributable to common stockholders was $154 million for the quarter, or $0.47 per diluted share, compared to $0.64 per diluted share in the prior year quarter, a decrease of 27 percent.
On an adjusted basis, organic revenue increased 5 percent, excluding the impact of divestitures and foreign currency fluctuations. Adjusted EBITDA margin expanded 170 basis points to 37.6 percent. Adjusted net earnings was $582 million, or $1.78 per diluted share, compared to $1.63 per diluted share in the prior year quarter, an increase of 9 percent.
($ millions, except per share data, unaudited) |
Three Months Ended June 30, |
||||||||||
|
2019 |
|
2018 |
|
%
|
Organic
|
|||||
|
|
|
|
|
|
|
|||||
Revenue |
$ |
2,112 |
|
|
$ |
2,106 |
|
|
- |
5% |
|
Integrated Financial Solutions |
1,179 |
|
|
1,124 |
|
|
5% |
6% |
|||
Global Financial Solutions |
865 |
|
|
899 |
|
|
(4)% |
4% |
|||
Corporate and Other |
68 |
|
|
83 |
|
|
(18)% |
3% |
|||
|
|
|
|
|
|
|
|||||
Adjusted EBITDA |
$ |
794 |
|
|
$ |
757 |
|
|
5% |
|
|
Adjusted EBITDA Margin |
37.6 |
% |
|
35.9 |
% |
|
170 bps |
|
|||
|
|
|
|
|
|
|
|||||
Net earnings attributable to FIS common stockholders (GAAP) |
$ |
154 |
|
|
$ |
212 |
|
|
(27)% |
|
|
Diluted EPS (GAAP) |
$ |
0.47 |
|
|
$ |
0.64 |
|
|
(27)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net earnings |
$ |
582 |
|
|
$ |
544 |
|
|
7% |
|
|
Adjusted EPS |
$ |
1.78 |
|
|
$ |
1.63 |
|
|
9% |
|
|
FIS Segment Information
-
Integrated Financial Solutions (IFS):
Second quarter GAAP revenue increased 5 percent versus prior year reflecting broad-based growth, partially offset by the impact of divestiture activity at year-end 2018. Organic revenue increased 6 percent, illustrating the ongoing strength of the continuing operations in the segment. Adjusted EBITDA margin was 45.3 percent, representing expansion of 150 basis points from the prior year quarter.
-
Global Financial Solutions (GFS):
Second quarter GAAP revenue decreased 4 percent versus prior year reflecting the negative impact of the Brazilian JV unwind offsetting growth in the continuing operations. Organic revenue increased 4 percent, enhanced by a return to growth in the Institutional & Wholesale business. Adjusted EBITDA margin was 36.1 percent, representing expansion of 120 basis points from the prior year quarter.
-
Corporate and Other:
Second quarter GAAP revenue decreased 18 percent to $68 million compared to $83 million in the prior year quarter, driven primarily by divestiture of the Certegy Check Services business in Q3 2018. Organic revenue increased 3 percent. Adjusted EBITDA loss was $53 million and is inclusive of $66 million of corporate expenses.
FIS Balance Sheet and Cash Flows
As of June 30, 2019, cash and cash equivalents totaled $9,756 million and debt outstanding totaled $18,242 million with an effective weighted average interest rate of 2.5 percent. The increase in cash and cash equivalents and debt was primarily driven by the successful US and European based debt financing in conjunction with the Worldpay transaction. Net cash provided by operating activities was $526 million and free cash flow was $413 million for the quarter. FIS paid dividends of $113 million in the quarter.
Worldpay Second Quarter 2019 Results
“I am excited about the strengths and new opportunities available through the combination of Worldpay and FIS,” said Charles Drucker, vice chairman of FIS. “Worldpay continues to deliver strong new sales due to our colleagues’ focus on execution and dedication to client service. Now with FIS, the two companies are uniquely positioned to capitalize on the most significant areas of secular growth.”
On a GAAP basis, revenue increased 7 percent to $1,073 million from $1,007 million in the prior year quarter. Net income (loss) attributable to Worldpay was $143 million for the quarter, or $0.46 per diluted share, compared to $(0.01) per diluted share in the prior year quarter.
On an adjusted basis, constant currency revenue increased 8 percent. Excluding cryptocurrency and foreign currency headwinds, Worldpay revenue increased by 9 percent. Adjusted EBITDA increased to $561 million from $493 million in the prior year quarter, while adjusted EBITDA margin expanded by 330 basis points to 52.3 percent. Adjusted net income was $387 million, or $1.24 per diluted share, compared to $1.04 per diluted share in the prior year quarter, an increase of 19 percent.
($ millions, except per share data, unaudited) |
Three Months Ended June 30, |
||||||||||
|
2019 |
|
2018 |
|
%
|
CC %
|
|||||
|
|
|
|
|
|
|
|||||
Revenue |
$ |
1,073 |
|
|
$ |
1,007 |
|
|
7% |
8% |
|
Technology Solutions |
466 |
|
|
402 |
|
|
16% |
18% |
|||
Merchant Solutions |
520 |
|
|
520 |
|
|
- |
2% |
|||
Issuer Solutions |
87 |
|
|
85 |
|
|
2% |
2% |
|||
|
|
|
|
|
|
|
|||||
Adjusted EBITDA |
$ |
561 |
|
|
$ |
493 |
|
|
14% |
|
|
Adjusted EBITDA Margin |
52.3 |
% |
|
49.0 |
% |
|
330 bps |
|
|||
|
|
|
|
|
|
|
|||||
Net income (loss) attributable to Worldpay (GAAP) |
$ |
143 |
|
|
$ |
(3) |
|
|
NM |
|
|
Net income (loss) per diluted share attributable to Worldpay (GAAP) |
$ |
0.46 |
|
|
$ |
(0.01) |
|
|
NM |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income |
$ |
387 |
|
|
$ |
327 |
|
|
18% |
|
|
Adjusted net income per share |
$ |
1.24 |
|
|
$ |
1.04 |
|
|
19% |
|
|
Worldpay Segment Information
-
Technology Solutions:
Second quarter GAAP revenue increased 16 percent to $466 million from $402 million in the prior year quarter. Constant currency revenue increased 18 percent. Excluding cryptocurrency and foreign currency headwinds, Technology Solutions revenue increased by 19 percent. Segment profit increased 13 percent to $342 million from $303 million in the prior year quarter.
-
Merchant Solutions:
Second quarter GAAP revenue was flat at $520 million, compared to the prior year quarter. Constant currency revenue increased 2 percent. Segment profit increased 2 percent to $347 million from $341 million in the prior year quarter.
-
Issuer Solutions:
Second quarter GAAP revenue increased 2 percent to $87 million from $85 million in the prior year quarter. Constant currency revenue increased 2 percent. Segment profit increased 2% to $80 million from $78 million in the prior year quarter.
Adjusted Combined Second Quarter 2019 Results
Adjusted combined results are representative of FIS and Worldpay as a combined entity in the second quarter of 2019.
On a go forward basis, the Company will operate and report three operating segments. These segments are based on the markets and clients served, aligned with the solutions they provide. The new operating segments will be: Merchant Solutions, Banking Solutions and Capital Market Solutions.
($ millions, unaudited) |
Three Months Ended June 30, |
||||||||||
|
2019 |
|
2018 |
|
%
|
Organic
|
|||||
|
|
|
|
|
|
|
|||||
Adjusted combined revenue |
$ |
3,185 |
|
|
$ |
3,114 |
|
|
2% |
6% |
|
Merchant Solutions |
1,098 |
|
|
1,017 |
|
|
8% |
10% |
|||
Banking Solutions |
1,493 |
|
|
1,495 |
|
|
- |
5% |
|||
Capital Market Solutions |
594 |
|
|
584 |
|
|
2% |
3% |
|||
Corporate and Other |
- |
|
|
18 |
|
|
NM |
NM |
|||
|
|
|
|
|
|
|
|||||
Adjusted combined EBITDA |
$ |
1,330 |
|
|
$ |
1,211 |
|
|
10% |
|
|
Adjusted combined EBITDA margin |
41.8 |
% |
|
38.9 |
% |
|
290 bps |
|
|||
Adjusted Net Earnings and Adjusted Earnings Per Share Update
Following discussions with the Staff of the Securities and Exchange Commission, FIS will revert to the Prior Method of reporting Adjusted Net Earnings and Adjusted Earnings Per Share in the third quarter of 2019. These non-GAAP measures will exclude the cost of amortization of purchase accounting intangibles as opposed to excluding all depreciation and amortization.
Third and fourth quarter 2019 Adjusted EPS guidance is calculated based on the Prior Method definition of Adjusted EPS. For transition purposes in this release, we have also provided what we previously named the New Method for this release only.
Third and Fourth Quarter 2019 GAAP Guidance |
|||||
($ millions, except share data) |
Q3 2019 |
Q4 2019 |
|||
Revenue |
$2,775 - $2,800 |
$3,285 - $3,330 |
|||
Net earnings |
$75 - $300 |
$300 - $510 |
|||
Diluted EPS |
$0.14 - $0.57 |
$0.48 - $0.82 |
|||
Third and Fourth Quarter 2019 Non-GAAP Guidance |
|||||
($ millions, except share data) |
Q3 2019 |
Q4 2019 |
|||
Revenue (GAAP) |
$2,775 - $2,800 |
$3,285 - $3,330 |
|||
Adjusted EBITDA |
$1,145 - $1,160 |
$1,470 - $1,500 |
|||
Adjusted EPS (Prior Method): Excludes amortization of purchase accounting intangibles only |
$1.33 - $1.37 |
$1.47 - $1.53 |
|||
Adjusted EPS (New Method): Excludes all depreciation and amortization |
$1.69 - $1.72 |
$1.80 - $1.84 |
|||
Webcast
FIS will sponsor a live webcast of its earnings conference call with the investment community beginning at 8:30 a.m. (EDT) Tues., August 6, 2019. To access the webcast, go to the Investor Relations section of FIS’ homepage, www.fisglobal.com. A replay will be available after the conclusion of the live webcast.
FIS is a global leader in technology, solutions and services for merchants, banks and capital markets that helps businesses and communities thrive by advancing commerce and the financial world. For over 50 years, FIS has continued to drive growth for clients around the world by creating tomorrow’s technology, solutions and services to modernize today’s businesses and customer experiences. By connecting merchants, banks and capital markets, we use our scale, apply our deep expertise and data-driven insights, innovate with purpose to solve for our clients’ future, and deliver experiences that are more simple, seamless and secure to advance the way the world pays, banks and invests.
Headquartered in Jacksonville, Florida, FIS employs about 55,000 people worldwide dedicated to helping our clients solve for the future. FIS is a Fortune 500® company and is a member of Standard & Poor’s 500® Index.
To learn more, visit www.fisglobal.com. Follow FIS on Facebook, LinkedIn and Twitter (@FISGlobal).
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 summarizing transactions and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, we have provided certain non-GAAP financial measures.
These non-GAAP measures include adjusted revenue, constant currency revenue, organic revenue increase/decrease, EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net earnings (including per share amounts), adjusted cash flows from operations and free cash flow. These non-GAAP measures may be used in this release and/or in the attached supplemental financial information.
We believe these non-GAAP measures help investors better understand the underlying fundamentals of our business. As further described below, the non-GAAP revenue and earnings measures presented eliminate items management believes are not indicative of FIS’ operating performance. The constant currency and organic revenue increase/decrease measures adjust for the effects of exchange rate fluctuations, while organic revenue increase/decrease also adjusts for acquisitions and divestitures, giving investors further insight into our performance. Finally, the non-GAAP cash flow measures provide further information about the ability of our business to generate cash. For these reasons, management also uses these non-GAAP measures in its assessment and management of FIS’ performance.
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 course of business by SunGard under GAAP but was not recognized due to GAAP purchase accounting adjustments. The deferred revenue adjustment in purchase accounting was made entirely in the Corporate and Other segment; reported GAAP results for the IFS and GFS segments are not affected by this adjustment and, therefore, no adjusted revenue is presented for these segments.
Constant currency revenue represents (i) adjusted revenue, as defined above, in respect of the consolidated results and the Corporate and Other segment and (ii) reported revenue in respect of the IFS and GFS segments, in each case excluding the impact of fluctuations in foreign currency exchange rates in the current period.
Organic revenue increase/decrease is constant currency revenue, as defined above, for the current period compared to an adjusted revenue base for the prior period, which is further adjusted to add pre-acquisition revenue of acquired businesses for a portion of the prior year matching the portion of the current year for which the business was owned, and subtract pre-divestiture revenue for divested businesses for the portion of the prior year matching the portion of the current year for which the business was not owned, for any acquisitions or divestitures by FIS.
EBITDA reflects earnings from continuing operations before interest, taxes, depreciation and amortization.
Adjusted EBITDA is EBITDA, as defined above, excluding certain costs and other transactions which management deems non-operational in nature, the removal of which improves comparability of operating results across reporting periods. This measure is reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. For this reason, adjusted EBITDA, as it relates to our segments, is presented in conformity with Accounting Standards Codification 280, Segment Reporting, and is excluded from the definition of non-GAAP financial measures under the Securities and Exchange Commission's Regulation G and Item 10(e) of Regulation S-K.
Adjusted EBITDA margin reflects adjusted EBITDA divided by adjusted revenue.
Adjusted net earnings (New Method) 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 depreciation and amortization and equity method investment earnings (loss), both of which are recurring.
Adjusted net earnings (Prior Method) 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 acquisition-related purchase accounting amortization and equity method investment earnings (loss), both of which are recurring.
Adjusted net earnings per diluted share, or Adjusted EPS (New Method), reflects adjusted net earnings from continuing operations (New Method) divided by weighted average diluted shares outstanding.
Adjusted net earnings per diluted share, or Adjusted EPS (Prior Method), reflects adjusted net earnings from continuing operations (Prior Method) divided by weighted average diluted shares outstanding.
Adjusted cash flows from operations reflect net cash provided by operating activities adjusted for the net change in settlement assets and obligations and exclude certain transactions that are closely associated with non-operating activities or are otherwise non-operational in nature and not indicative of future operating cash flows.
Free cash flow reflects adjusted cash flows from operations less capital expenditures. Free cash flow does not represent our residual cash flow available for discretionary expenditures, since we have mandatory debt service requirements and other non-discretionary expenditures that are not deducted from the measure.
Any non-GAAP measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP measures. Further, FIS’ non-GAAP measures may be calculated differently from similarly titled measures of other companies. Reconciliations of these non-GAAP measures to related GAAP measures, including footnotes describing the specific adjustments, are provided in the attached schedules and in the Investor Relations section of the FIS website, www.fisglobal.com.
Worldpay Use of Non-GAAP Financial Information
This earnings release presents non-GAAP and pro forma financial information including adjusted EBITDA, adjusted net income, and adjusted net income per share. These have been important financial performance measures for Worldpay, but are not financial measures as defined by GAAP. The presentation of this financial information is not intended to be considered in isolation of or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Worldpay has used these non-GAAP and adjusted financial performance measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. Worldpay believes that they provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. Reconciliations of these measures to the most directly comparable GAAP financial measures are presented in the attached schedules.
Forward-Looking Statements
This earnings release 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 conditions, outlook, foreign currency exchange rates, expected dividends and share repurchases, the Company’s sales pipeline and anticipated profitability and growth, as well as other statements about our expectations, beliefs, intentions, or strategies regarding the future, are forward-looking statements. These statements relate to future events and our future results, and involve a number of risks and uncertainties. Forward-looking statements are based on management’s beliefs, as well as assumptions made by, and information currently available to, management. Any statements that refer to beliefs, expectations, projections or other characterizations of future events or circumstances and other statements that are not historical facts are forward-looking statements.
Actual results, performance or achievement could differ materially from those contained in these forward-looking statements. The risks and uncertainties that forward-looking statements are subject to include, without limitation:
- the risk that the Worldpay transaction will not provide the expected benefits, or that we will not be able to achieve the cost or revenue synergies anticipated;
- the risk that the integration of FIS and Worldpay will be more difficult, time-consuming or expensive than anticipated;
- the risk of customer loss or other business disruption in connection with the Worldpay transaction, or of the loss of key employees;
- the fact that unforeseen liabilities of FIS or Worldpay may exist;
- the risk that acquired businesses will not be integrated successfully, or that the integration will be more costly or more time-consuming and complex than anticipated;
- the risk that cost savings and other synergies anticipated to be realized from acquisitions may not be fully realized or may take longer to realize than expected;
- the risks of doing business internationally;
- changes in general economic, business and political conditions, including the possibility of intensified international hostilities, acts of terrorism, changes in either or both the United States and international lending, capital and financial markets, and currency fluctuations;
- 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 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;
- 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 loss of personal information and computer viruses and other malware affecting our software or platforms, and the reactions of customers, card associations, government regulators and others to any such events;
- the risk that implementation of software (including software updates) for customers or at customer locations or employee error in monitoring our software and platforms may result in the corruption or loss of data or customer information, interruption of business operations, outages, exposure to liability claims or loss of customers;
- the reaction of current and potential customers to communications from us or regulators regarding information security, risk management, internal audit or other matters;
- 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 into the market by global banks and global companies with respect to certain competitive solutions, each of which may have the impact of unbundling individual solutions from a comprehensive suite of solutions we provide to many of our customers;
- the failure to innovate in order to keep up with new emerging technologies, which could impact our solutions and our ability to attract new, or retain existing, customers;
- the failure to meet financial goals to grow the business in Brazil after the unwinding of the Brazilian Venture;
- the risks of reduction in revenue from the loss of existing and/or potential customers in Brazil after the unwinding of the Brazilian Venture;
- an operational or natural disaster at one of our major operations centers;
- failure to comply with applicable requirements of payment networks or card schemes or changes in those requirements;
- fraud by merchants or bad actors; and
- other risks detailed in the “Risk Factors” and other sections of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and in our other filings with the Securities and Exchange Commission.
Other unknown or unpredictable factors also could have a material adverse effect on our business, financial condition, results of operations and prospects. Accordingly, readers should not place undue reliance on these forward-looking statements. These forward-looking statements are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Except as required by applicable law or regulation, we do not undertake (and expressly disclaim) any obligation and do not intend to publicly update or review any of these forward-looking statements, whether as a result of new information, future events or otherwise.
Fidelity National Information Services, Inc. Earnings Release Supplemental Financial Information August 6, 2019 |
||
Exhibit A |
Condensed Consolidated Statements of Earnings - Unaudited for the three and six months ended June 30, 2019 and 2018 |
|
|
|
|
Exhibit B |
Condensed Consolidated Balance Sheets - Unaudited as of June 30, 2019 and December 31, 2018 |
|
|
|
|
Exhibit C |
Condensed Consolidated Statements of Cash Flows - Unaudited for the six months ended June 30, 2019 and 2018 |
|
|
|
|
Exhibit D |
Supplemental Non-GAAP Financial Information - Unaudited for the three and six months ended June 30, 2019 and 2018 |
|
|
|
|
Exhibit E |
Supplemental GAAP to Non-GAAP Reconciliations - Unaudited for the three and six months ended June 30, 2019 and 2018 |
|
|
|
|
Exhibit F |
Supplemental GAAP to Non-GAAP Reconciliations on Guidance - Unaudited for the three months ended September 30 and December 31, 2019 |
|
FIDELITY NATIONAL INFORMATION SERVICES, INC. CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS — UNAUDITED (In millions, except per share amounts) |
||||||||||||||||
Exhibit A |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
|
Three months ended |
|
Six months ended |
|||||||||||||
|
June 30, |
|
June 30, |
|||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|||||||||
Revenue |
$ |
2,112 |
|
|
$ |
2,106 |
|
|
$ |
4,169 |
|
|
$ |
4,172 |
|
|
Cost of revenue |
1,404 |
|
|
1,414 |
|
|
2,785 |
|
|
2,828 |
|
|||||
Gross profit |
708 |
|
|
692 |
|
|
1,384 |
|
|
1,344 |
|
|||||
Selling, general and administrative expenses |
317 |
|
|
339 |
|
|
678 |
|
|
697 |
|
|||||
Operating income |
391 |
|
|
353 |
|
|
706 |
|
|
647 |
|
|||||
Other income (expense): |
|
|
|
|
|
|
|
|||||||||
Interest expense, net |
(72 |
) |
|
(73 |
) |
|
(147 |
) |
|
(144 |
) |
|||||
Other income (expense), net |
(120 |
) |
|
(4 |
) |
|
(172 |
) |
|
(2 |
) |
|||||
Total other income (expense), net |
(192 |
) |
|
(77 |
) |
|
(319 |
) |
|
(146 |
) |
|||||
Earnings before income taxes and equity method investment earnings (loss) |
199 |
|
|
276 |
|
|
387 |
|
|
501 |
|
|||||
Provision (benefit) for income taxes |
40 |
|
|
51 |
|
|
72 |
|
|
85 |
|
|||||
Equity method investment earnings (loss) |
(4 |
) |
|
(7 |
) |
|
(11 |
) |
|
(8 |
) |
|||||
Net earnings |
155 |
|
|
218 |
|
|
304 |
|
|
408 |
|
|||||
Net (earnings) loss attributable to noncontrolling interest |
(1 |
) |
|
(6 |
) |
|
(2 |
) |
|
(14 |
) |
|||||
Net earnings attributable to FIS common stockholders |
$ |
154 |
|
|
$ |
212 |
|
|
$ |
302 |
|
|
$ |
394 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Net earnings per share-basic attributable to FIS common stockholders |
$ |
0.48 |
|
|
$ |
0.64 |
|
|
$ |
0.93 |
|
|
$ |
1.20 |
|
|
Weighted average shares outstanding-basic |
324 |
|
|
329 |
|
|
323 |
|
|
329 |
|
|||||
Net earnings per share-diluted attributable to FIS common stockholders |
$ |
0.47 |
|
|
$ |
0.64 |
|
|
$ |
0.92 |
|
|
$ |
1.18 |
|
|
Weighted average shares outstanding-diluted |
327 |
|
|
333 |
|
|
327 |
|
|
334 |
|
|||||
FIDELITY NATIONAL INFORMATION SERVICES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS — UNAUDITED (In millions, except per share amounts) |
||||||||
|
|
|
Exhibit B |
|||||
|
|
|
|
|||||
|
June 30, |
|
December 31, |
|||||
|
2019 |
|
2018 |
|||||
Assets |
|
|
|
|||||
Current assets: |
|
|
|
|||||
Cash and cash equivalents |
$ |
9,756 |
|
|
$ |
703 |
|
|
Settlement deposits |
538 |
|
|
700 |
|
|||
Trade receivables, net |
1,366 |
|
|
1,472 |
|
|||
Contract assets |
122 |
|
|
123 |
|
|||
Settlement receivables |
289 |
|
|
281 |
|
|||
Other receivables |
137 |
|
|
166 |
|
|||
Prepaid expenses and other current assets |
297 |
|
|
288 |
|
|||
Total current assets |
12,505 |
|
|
3,733 |
|
|||
Property and equipment, net |
541 |
|
|
587 |
|
|||
Goodwill |
13,542 |
|
|
13,545 |
|
|||
Intangible assets, net |
2,863 |
|
|
3,132 |
|
|||
Computer software, net |
1,798 |
|
|
1,795 |
|
|||
Other noncurrent assets |
1,049 |
|
|
503 |
|
|||
Deferred contract costs, net |
561 |
|
|
475 |
|
|||
Total assets |
$ |
32,859 |
|
|
$ |
23,770 |
|
|
|
|
|
|
|||||
Liabilities and Equity |
|
|
|
|||||
Current liabilities: |
|
|
|
|||||
Accounts payable, accrued and other liabilities |
$ |
1,030 |
|
|
$ |
1,099 |
|
|
Settlement payables |
792 |
|
|
972 |
|
|||
Deferred revenue |
788 |
|
|
739 |
|
|||
Short-term borrowings |
1,507 |
|
|
267 |
|
|||
Current portion of long-term debt |
53 |
|
|
48 |
|
|||
Total current liabilities |
4,170 |
|
|
3,125 |
|
|||
Long-term debt, excluding current portion |
16,682 |
|
|
8,670 |
|
|||
Deferred income taxes |
1,295 |
|
|
1,360 |
|
|||
Other long-term liabilities |
664 |
|
|
326 |
|
|||
Deferred revenue |
56 |
|
|
67 |
|
|||
Total liabilities |
22,867 |
|
|
13,548 |
|
|||
Equity: |
|
|
|
|||||
FIS stockholders’ equity: |
|
|
|
|||||
Preferred stock $0.01 par value |
— |
|
|
— |
|
|||
Common stock $0.01 par value |
4 |
|
|
4 |
|
|||
Additional paid in capital |
10,887 |
|
|
10,800 |
|
|||
Retained earnings |
4,599 |
|
|
4,528 |
|
|||
Accumulated other comprehensive earnings (loss) |
(438 |
) |
|
(430 |
) |
|||
Treasury stock, at cost |
(5,067 |
) |
|
(4,687 |
) |
|||
Total FIS stockholders’ equity |
9,985 |
|
|
10,215 |
|
|||
Noncontrolling interest |
7 |
|
|
7 |
|
|||
Total equity |
9,992 |
|
|
10,222 |
|
|||
Total liabilities and equity |
$ |
32,859 |
|
|
$ |
23,770 |
|
|
FIDELITY NATIONAL INFORMATION SERVICES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS — UNAUDITED (In millions) |
||||||||
|
|
|
Exhibit C |
|||||
|
|
|
|
|||||
|
Six months ended June 30, |
|||||||
|
2019 |
|
2018 |
|||||
Cash flows from operating activities: |
|
|
|
|||||
Net earnings |
$ |
304 |
|
|
$ |
408 |
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities: |
|
|
|
|||||
Depreciation and amortization |
736 |
|
|
706 |
|
|||
Amortization of debt issue costs |
10 |
|
|
9 |
|
|||
Acquisition-related financing foreign exchange |
104 |
|
|
— |
|
|||
Loss (gain) on sale of businesses and investments |
— |
|
|
(6 |
) |
|||
Loss (gain) other |
17 |
|
|
— |
|
|||
Loss on extinguishment of debt |
— |
|
|
1 |
|
|||
Stock-based compensation |
43 |
|
|
45 |
|
|||
Deferred income taxes |
(68 |
) |
|
(24 |
) |
|||
Net changes in assets and liabilities, net of effects from acquisitions and foreign currency: |
|
|
|
|||||
Trade and other receivables |
93 |
|
|
189 |
|
|||
Contract assets |
1 |
|
|
(3 |
) |
|||
Settlement activity |
(27 |
) |
|
13 |
|
|||
Prepaid expenses and other assets |
(140 |
) |
|
(11 |
) |
|||
Deferred contract costs |
(174 |
) |
|
(119 |
) |
|||
Deferred revenue |
39 |
|
|
(2 |
) |
|||
Accounts payable, accrued liabilities and other liabilities |
(118 |
) |
|
(383 |
) |
|||
Net cash provided by operating activities |
820 |
|
|
823 |
|
|||
|
|
|
|
|||||
Cash flows from investing activities: |
|
|
|
|||||
Additions to property and equipment |
(57 |
) |
|
(83 |
) |
|||
Additions to computer software |
(228 |
) |
|
(233 |
) |
|||
Net proceeds from sale of businesses and investments |
43 |
|
|
49 |
|
|||
Other investing activities, net |
(42 |
) |
|
(6 |
) |
|||
Net cash provided by (used in) investing activities |
(284 |
) |
|
(273 |
) |
|||
|
|
|
|
|||||
Cash flows from financing activities: |
|
|
|
|||||
Borrowings |
19,201 |
|
|
5,703 |
|
|||
Repayment of borrowings and other financing obligations |
(10,028 |
) |
|
(5,521 |
) |
|||
Debt issuance costs |
(71 |
) |
|
(24 |
) |
|||
Proceeds from exercise of stock options |
86 |
|
|
203 |
|
|||
Treasury stock activity |
(423 |
) |
|
(637 |
) |
|||
Dividends paid |
(226 |
) |
|
(211 |
) |
|||
Other financing activities, net |
(24 |
) |
|
(2 |
) |
|||
Net cash provided by (used in) financing activities |
8,515 |
|
|
(489 |
) |
|||
|
|
|
|
|||||
Effect of foreign currency exchange rate changes on cash |
2 |
|
|
(43 |
) |
|||
Net increase (decrease) in cash and cash equivalents |
9,053 |
|
|
18 |
|
|||
Cash and cash equivalents, at beginning of period |
703 |
|
|
665 |
|
|||
Cash and cash equivalents, at end of period |
$ |
9,756 |
|
|
$ |
683 |
|
|
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION — UNAUDITED (In millions) |
||||||||||||||||
Exhibit D |
||||||||||||||||
Three months ended June 30, 2018 |
||||||||||||||||
|
Integrated
|
|
Global
|
|
Corporate
|
|
Consolidated |
|||||||||
Revenue |
$ |
1,124 |
|
|
$ |
899 |
|
|
$ |
83 |
|
|
$ |
2,106 |
|
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|||||||||
Acquisition deferred revenue adjustment (1) |
— |
|
|
— |
|
|
1 |
|
|
1 |
|
|||||
Adjusted revenue |
$ |
1,124 |
|
|
$ |
899 |
|
|
$ |
84 |
|
|
$ |
2,107 |
|
|
|
Six months ended June 30, 2018 |
|||||||||||||||
|
Integrated
|
|
Global
|
|
Corporate
|
|
Consolidated |
|||||||||
Revenue |
$ |
2,185 |
|
|
$ |
1,826 |
|
|
$ |
161 |
|
|
$ |
4,172 |
|
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|||||||||
Acquisition deferred revenue adjustment (1) |
— |
|
|
— |
|
|
3 |
|
|
3 |
|
|||||
Adjusted revenue |
$ |
2,185 |
|
|
$ |
1,826 |
|
|
$ |
164 |
|
|
$ |
4,175 |
|
|
(1) See note (3) to Exhibit E |
||||||||||||||||
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL NON-GAAP ORGANIC REVENUE GROWTH — UNAUDITED (In millions) |
|||||||||||||||||||||||||||
Exhibit D (continued) |
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Three months ended June 30, |
||||||||||||||||||||||||||
|
2019 |
|
2018 |
|
|
||||||||||||||||||||||
|
|
|
|
|
Constant |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
Currency |
|
Adjusted |
|
In Year |
|
Adjusted |
|
Organic |
||||||||||||||
|
Revenue |
|
FX |
|
Revenue |
|
Revenue |
|
Adjustments (1) |
|
Base |
|
Growth |
||||||||||||||
Integrated Financial Solutions |
$ |
1,179 |
|
|
$ |
1 |
|
|
$ |
1,180 |
|
|
$ |
1,124 |
|
|
$ |
(9 |
) |
|
$ |
1,115 |
|
|
5.8 |
% |
|
Global Financial Solutions |
865 |
|
|
17 |
|
|
882 |
|
|
899 |
|
|
(53 |
) |
|
846 |
|
|
4.2 |
% |
|||||||
Corporate and Other |
68 |
|
|
— |
|
|
68 |
|
|
84 |
|
|
(18 |
) |
|
66 |
|
|
2.9 |
% |
|||||||
Total |
$ |
2,112 |
|
|
$ |
18 |
|
|
$ |
2,130 |
|
|
$ |
2,107 |
|
|
$ |
(80 |
) |
|
$ |
2,027 |
|
|
5.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Six months ended June 30, |
||||||||||||||||||||||||||
|
2019 |
|
2018 |
|
|
||||||||||||||||||||||
|
|
|
|
|
Constant |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
Currency |
|
Adjusted |
|
In Year |
|
Adjusted |
|
Organic |
||||||||||||||
|
Revenue |
|
FX |
|
Revenue |
|
Revenue |
|
Adjustments (1) |
|
Base |
|
Growth |
||||||||||||||
Integrated Financial Solutions |
$ |
2,309 |
|
|
$ |
2 |
|
|
$ |
2,311 |
|
|
$ |
2,185 |
|
|
$ |
(17 |
) |
|
$ |
2,168 |
|
|
6.6 |
% |
|
Global Financial Solutions |
1,728 |
|
|
42 |
|
|
1,769 |
|
|
1,826 |
|
|
(113 |
) |
|
1,713 |
|
|
3.3 |
% |
|||||||
Corporate and Other |
132 |
|
|
— |
|
|
133 |
|
|
164 |
|
|
(36 |
) |
|
129 |
|
|
3.5 |
% |
|||||||
Total |
$ |
4,169 |
|
|
$ |
44 |
|
|
$ |
4,213 |
|
|
$ |
4,175 |
|
|
$ |
(165 |
) |
|
$ |
4,010 |
|
|
5.1 |
% |
|
Amounts in table may not sum or calculate due to rounding. |
|||||||||||||||||||||||||||
(1) |
In year adjustments primarily include removing revenue from the Certegy Check Services business unit in North America, the Reliance Trust Company of Delaware and the Kingstar divestitures and the unwinding of the Brazilian Venture. |
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL NON-GAAP CASH FLOW MEASURES — UNAUDITED (In millions) |
|||||||
Exhibit D (continued) |
|||||||
|
|
|
|
||||
|
Three months ended |
|
Six months ended |
||||
|
June 30, 2019 |
|
June 30, 2019 |
||||
Net cash provided by operating activities |
$ |
526 |
|
|
$ |
820 |
|
Non-GAAP adjustments: |
|
|
|
||||
Acquisition, integration and other payments (1) |
46 |
|
|
90 |
|
||
Tax payments on divestitures (2) |
10 |
|
|
10 |
|
||
Settlement activity |
(29 |
) |
|
27 |
|
||
Adjusted cash flows from operations |
553 |
|
|
947 |
|
||
Capital expenditures |
(140 |
) |
|
(285 |
) |
||
Free cash flow |
$ |
413 |
|
|
$ |
662 |
|
|
|
|
|
||||
|
Three months ended |
|
Six months ended |
||||
|
June 30, 2018 |
|
June 30, 2018 |
||||
Net cash provided by operating activities |
$ |
469 |
|
|
$ |
823 |
|
Non-GAAP adjustments: |
|
|
|
||||
Acquisition, integration and other payments (1) |
34 |
|
|
61 |
|
||
Tax payments on divestitures (2) |
— |
|
|
19 |
|
||
Debt financing activities (3) |
1 |
|
|
1 |
|
||
Settlement activity |
(11 |
) |
|
(13 |
) |
||
Adjusted cash flows from operations |
493 |
|
|
891 |
|
||
Capital expenditures |
(144 |
) |
|
(316 |
) |
||
Free cash flow |
$ |
349 |
|
|
$ |
575 |
|
Free cash flow reflects adjusted cash flows from operations less capital expenditures. Free cash flow does not represent our residual cash flows available for discretionary expenditures, since we have mandatory debt service requirements and other non-discretionary expenditures that are not deducted from the measure.
| (1) | Adjusted cash flows from operations and free cash flow for the three and six months ended June 30, 2019 and 2018 exclude cash payments for certain acquisition, integration and other costs, net of related tax impact. The related tax impact totaled $11 million and $8 million for the three months and $21 million and $15 million for the six months ended June 30, 2019 and 2018, respectively. |
|
|
| (2) | Adjusted cash flows from operations and free cash flow exclude tax payments made in 2019 related to the sale of Reliance Trust Company of Delaware and the unwinding of the Brazilian Venture recognized during 2018. Adjusted cash flows from operations and free cash flow exclude tax payments made in 2018 related to the sale of Capco consulting business and risk and compliance consulting business recognized during 2017. |
|
|
| (3) | Adjusted cash flows from operations and free cash flow for the three and six months ended June 30, 2018 exclude the $1 million one-time bond premium payment on the redemption of our senior notes due October 2018. |
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED (In millions, except per share amounts) |
||||||||||||||||
Exhibit E |
||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Three months ended |
|
Six months ended |
||||||||||||
|
|
June 30, |
|
June 30, |
||||||||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Net earnings attributable to FIS common stockholders |
|
$ |
154 |
|
|
$ |
212 |
|
|
$ |
302 |
|
|
$ |
394 |
|
Provision (benefit) for income taxes |
|
40 |
|
|
51 |
|
|
72 |
|
|
85 |
|
||||
Interest expense, net |
|
72 |
|
|
73 |
|
|
147 |
|
|
144 |
|
||||
Other, net |
|
125 |
|
|
17 |
|
|
185 |
|
|
24 |
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating income, as reported |
|
391 |
|
|
353 |
|
|
706 |
|
|
647 |
|
||||
FIS non-GAAP adjustments: |
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization (1) |
|
368 |
|
|
354 |
|
|
736 |
|
|
706 |
|
||||
Acquisition, integration and other costs (2) |
|
35 |
|
|
49 |
|
|
81 |
|
|
106 |
|
||||
Acquisition deferred revenue adjustment (3) |
|
— |
|
|
1 |
|
|
— |
|
|
3 |
|
||||
Adjusted EBITDA |
|
$ |
794 |
|
|
$ |
757 |
|
|
$ |
1,523 |
|
|
$ |
1,462 |
|
See notes to Exhibit E. |
||||||||||||||||
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED (In millions, except per share amounts) |
||||||||||||||||
Exhibit E (continued) |
||||||||||||||||
|
|
Three months ended |
|
Six months ended |
||||||||||||
|
|
June 30, |
|
June 30, |
||||||||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Earnings before income taxes and equity method investment earnings (loss) |
|
$ |
199 |
|
|
$ |
276 |
|
|
$ |
387 |
|
|
$ |
501 |
|
Provision (benefit) for income taxes |
|
40 |
|
|
51 |
|
|
72 |
|
|
85 |
|
||||
Equity method investment earnings (loss) |
|
(4 |
) |
|
(7 |
) |
|
(11 |
) |
|
(8 |
) |
||||
Net (earnings) loss attributable to noncontrolling interest |
|
(1 |
) |
|
(6 |
) |
|
(2 |
) |
|
(14 |
) |
||||
Net earnings attributable to FIS common stockholders |
|
154 |
|
|
212 |
|
|
302 |
|
|
394 |
|
||||
FIS non-GAAP adjustments: |
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization (1) |
|
368 |
|
|
354 |
|
|
736 |
|
|
706 |
|
||||
Acquisition, integration and other costs (2) |
|
46 |
|
|
49 |
|
|
146 |
|
|
106 |
|
||||
Acquisition deferred revenue adjustment (3) |
|
— |
|
|
1 |
|
|
— |
|
|
3 |
|
||||
Loss (gain) on sale of businesses and investments (4) |
|
— |
|
|
1 |
|
|
6 |
|
|
(2 |
) |
||||
Debt financing activities (5) |
|
102 |
|
|
1 |
|
|
102 |
|
|
1 |
|
||||
Equity method investment earnings (loss) (6) |
|
4 |
|
|
7 |
|
|
11 |
|
|
8 |
|
||||
Provision for income taxes on non-GAAP adjustments |
|
(92 |
) |
|
(81 |
) |
|
(186 |
) |
|
(172 |
) |
||||
Total non-GAAP adjustments |
|
428 |
|
|
332 |
|
|
815 |
|
|
650 |
|
||||
Adjusted net earnings, net of tax |
|
$ |
582 |
|
|
$ |
544 |
|
|
$ |
1,117 |
|
|
$ |
1,044 |
|
|
|
|
|
|
|
|
|
|
||||||||
Net earnings per share - diluted attributable to FIS common stockholders |
|
$ |
0.47 |
|
|
$ |
0.64 |
|
|
$ |
0.92 |
|
|
$ |
1.18 |
|
FIS non-GAAP adjustments: |
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization (1) |
|
1.13 |
|
|
1.06 |
|
|
2.25 |
|
|
2.11 |
|
||||
Acquisition, integration and other costs (2) |
|
0.14 |
|
|
0.15 |
|
|
0.45 |
|
|
0.32 |
|
||||
Acquisition deferred revenue adjustment (3) |
|
— |
|
|
— |
|
|
— |
|
|
0.01 |
|
||||
Loss (gain) on sale of businesses and investments (4) |
|
— |
|
|
— |
|
|
0.02 |
|
|
(0.01 |
) |
||||
Debt financing activities (5) |
|
0.31 |
|
|
— |
|
|
0.31 |
|
|
— |
|
||||
Equity method investment earnings (loss) (6) |
|
0.01 |
|
|
0.02 |
|
|
0.03 |
|
|
0.02 |
|
||||
Provision for income taxes on non-GAAP adjustments |
|
(0.28 |
) |
|
(0.24 |
) |
|
(0.57 |
) |
|
(0.51 |
) |
||||
Adjusted net earnings per share - diluted attributable to FIS common stockholders |
|
$ |
1.78 |
|
|
$ |
1.63 |
|
|
$ |
3.42 |
|
|
$ |
3.13 |
|
Weighted average shares outstanding-diluted |
|
327 |
|
|
333 |
|
|
327 |
|
|
334 |
|
||||
Amounts in table may not sum or calculate due to rounding. |
||||||||||||||||
See notes to Exhibit E. |
||||||||||||||||
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED (In millions, except per share amounts) |
||||||||||||||||
Exhibit E (continued) |
||||||||||||||||
|
|
Three months ended |
|
Six months ended |
||||||||||||
|
|
June 30, |
|
June 30, |
||||||||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Reconciliation of adjusted net earnings: |
|
|
|
|
|
|
|
|
||||||||
Adjusted net earnings, net of tax (New Method) |
|
$ |
582 |
|
|
$ |
544 |
|
|
$ |
1,117 |
|
|
$ |
1,044 |
|
Less: depreciation and amortization of non-purchase accounting assets (1) |
|
193 |
|
|
169 |
|
|
388 |
|
|
338 |
|
||||
Plus: tax on depreciation and amortization of non-purchase accounting assets (1) |
|
36 |
|
|
33 |
|
|
73 |
|
|
66 |
|
||||
Adjusted net earnings, net of tax (Prior Method) |
|
$ |
425 |
|
|
$ |
408 |
|
|
$ |
802 |
|
|
$ |
772 |
|
|
|
Three months ended |
|
Six months ended |
||||||||||||
|
|
June 30, |
|
June 30, |
||||||||||||
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
Reconciliation of adjusted net earnings per share - diluted attributable to FIS common stockholders: |
|
|
|
|
|
|
|
|
||||||||
Adjusted net earnings per share - diluted attributable to FIS common stockholders (New Method) |
|
$ |
1.78 |
|
|
$ |
1.63 |
|
|
$ |
3.42 |
|
|
$ |
3.13 |
|
Less: depreciation and amortization of non-purchase accounting assets (1) |
|
0.59 |
|
|
0.51 |
|
|
1.19 |
|
|
1.01 |
|
||||
Plus: tax on depreciation and amortization of non-purchase accounting assets (1) |
|
0.11 |
|
|
0.10 |
|
|
0.22 |
|
|
0.20 |
|
||||
Adjusted net earnings per share - diluted attributable to FIS common stockholders (Prior Method) |
|
$ |
1.30 |
|
|
$ |
1.23 |
|
|
$ |
2.45 |
|
|
$ |
2.31 |
|
Amounts in table may not sum or calculate due to rounding. |
||||||||||||||||
See notes to Exhibit E. |
||||||||||||||||
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED (In millions, except per share amounts) |
|
Exhibit E (continued) |
|
Notes to Unaudited - Supplemental GAAP to Non-GAAP Reconciliations for the three and six months ended June 30, 2019 and 2018. |
|
| The adjustments are as follows: | |
(1) |
This item represents the impact of depreciation and amortization expense. The Company has excluded the impact of depreciation of fixed assets and amortization of intangibles as such amounts can be significantly impacted by the timing and/or size of acquisitions. Although the Company excludes these amounts from its non-GAAP expenses, the Company believes that it is important for investors to understand that such tangible and intangible assets contribute to revenue generation. Depreciation and amortization of assets, including those that relate to past acquisitions, will recur in future periods until such assets have been fully depreciated or amortized. Any future acquisitions may result in the depreciation and/or amortization of future assets. Within the depreciation and amortization item, $193 million and $169 million for the three months and $388 million and $338 million for the six months ended June 30, 2019 and 2018, respectively, consist of depreciation and amortization of non-purchase accounting assets. The tax effects related to depreciation and amortization of non-purchase accounting assets are $36 million and $33 million for the three months and $73 million and $66 million for the six months ended June 30, 2019 and 2018, respectively. |
|
|
(2) |
This item represents acquisition and integration costs primarily related to the acquisition of Worldpay and certain other costs including those associated with data center consolidation activities of $17 million and $25 million for the three and six months ended June 30, 2019, respectively. For the 2018 periods, this item represents acquisition and integration costs primarily related to the SunGard acquisition and certain other costs. |
|
|
(3) |
This item represents the impact of the purchase accounting adjustment to reduce SunGard's deferred revenues 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 normal course of business by SunGard under GAAP if the acquisition had not occurred, but was not recognized due to GAAP purchase accounting requirements. The year ended December 31, 2018 was the final year impacted by this purchase accounting adjustment. |
|
|
(4) |
This item represents the net pre-tax loss (gain) on sale of businesses and investments during the three months ended June 30, 2018 and six months ended June 30, 2019 and 2018. |
|
|
(5) |
This item primarily represents the non-cash foreign currency impact of non-hedged Euro- and Pound Sterling-denominated notes issued during the three months ended June 30, 2019 to finance the Worldpay acquisition. For the 2018 periods, this item represents the write-off of certain previously capitalized debt issuance costs and the payment of a bond premium associated with the early redemption of our senior notes due October 2018 during June 2018. |
|
|
(6) |
This item represents our equity method investment earnings or loss and is predominantly due to our equity ownership interest in Cardinal Holdings, LP. |
FIDELITY NATIONAL INFORMATION SERVICES, INC. SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS ON GUIDANCE — UNAUDITED (In millions, except per share amounts) |
||||||||||||||||
Exhibit F |
||||||||||||||||
|
|
Three months ended |
|
Three months ended |
||||||||||||
|
|
September 30, 2019 |
|
December 31, 2019 |
||||||||||||
|
|
Low |
|
High |
|
Low |
|
High |
||||||||
Net earnings |
|
$ |
75 |
|
|
$ |
300 |
|
|
$ |
300 |
|
|
$ |
510 |
|
Estimated adjustments (1) |
|
1,070 |
|
|
860 |
|
|
1,170 |
|
|
990 |
|
||||
Adjusted EBITDA |
|
$ |
1,145 |
|
|
$ |
1,160 |
|
|
$ |
1,470 |
|
|
$ |
1,500 |
|
|
|
|
|
|
|
|
|
|
||||||||
Net earnings per share - diluted attributable to FIS common stockholders |
|
$ |
0.14 |
|
|
$ |
0.57 |
|
|
$ |
0.48 |
|
|
$ |
0.82 |
|
Estimated adjustments (2) |
|
1.19 |
|
|
0.80 |
|
|
0.99 |
|
|
0.71 |
|
||||
Adjusted net earnings per share - diluted attributable to FIS common stockholders (Prior Method) |
|
$ |
1.33 |
|
|
$ |
1.37 |
|
|
$ |
1.47 |
|
|
$ |
1.53 |
|
|
|
|
|
|
|
|
|
|
||||||||
Net earnings per share - diluted attributable to FIS common stockholders |
|
$ |
0.14 |
|
|
$ |
0.57 |
|
|
$ |
0.48 |
|
|
$ |
0.82 |
|
Estimated adjustments (2) |
|
1.55 |
|
|
1.15 |
|
|
1.32 |
|
|
1.02 |
|
||||
Adjusted net earnings per share - diluted attributable to FIS common stockholders (New Method) |
|
$ |
1.69 |
|
|
$ |
1.72 |
|
|
$ |
1.80 |
|
|
$ |
1.84 |
|
| The guidance table above and related adjustments noted below are for the combined company including Worldpay. | |
(1) |
Estimated adjustments include acquisition, integration and other costs and other items. |
(2) |
Estimated adjustments include depreciation and amortization, acquisition, integration and other costs, equity method investment earnings (loss) and other items, net of tax impact. |
Exhibit 99.2
Worldpay, Inc.
Earnings Release Supplemental Financial Information
August 6, 2019
Schedule 1 |
Consolidated Statements of Income - Unaudited for the three and six months ended June 30, 2019 and 2018 |
||
Schedule 2 |
Adjusted Net Income - Unaudited for the three and six months ended June 30, 2019 and 2018 |
||
Schedule 3 |
Segment Information - Unaudited for the three and six months ended June 30, 2019 and 2018 |
||
Schedule 4 |
Condensed Consolidated Statements of Financial Position - Unaudited as of June 30, 2019 and as of December 31, 2018 |
||
Schedule 5 |
Consolidated Statements of Cash Flows - Unaudited for the six months ended June 30, 2019 and 2018 |
||
Schedule 6 |
Reconciliation of GAAP Net Income to Adjusted EBITDA - Unaudited for the three and six months ended June 30, 2019 and 2018 |
Schedule 1 Worldpay, Inc. Consolidated Statements of Income (Unaudited) (in millions, except share data) |
||||||||||||||||||||||
|
Three Months Ended June 30, |
|
|
|
Six Months Ended June 30, |
|
||||||||||||||||
|
2019 |
|
2018 |
|
Change |
|
2019 |
|
2018 |
Change |
||||||||||||
Revenue |
$ |
1,073.0 |
|
|
$ |
1,006.8 |
|
|
7 |
% |
|
$ |
2,043.0 |
|
|
$ |
1,857.5 |
|
10 |
% |
||
Sales and marketing |
304.0 |
|
|
283.4 |
|
|
7 |
% |
|
594.9 |
|
|
549.4 |
|
8 |
% |
||||||
Other operating costs |
173.5 |
|
|
185.5 |
|
|
(6 |
)% |
|
354.5 |
|
|
340.6 |
|
4 |
% |
||||||
General and administrative |
105.6 |
|
|
136.8 |
|
|
(23 |
)% |
|
233.0 |
|
|
386.9 |
|
(40 |
)% |
||||||
Depreciation and amortization |
253.4 |
|
|
287.9 |
|
|
(12 |
)% |
|
517.8 |
|
|
495.1 |
|
5 |
% |
||||||
Income (loss) from operations |
236.5 |
|
|
113.2 |
|
|
109 |
% |
|
342.8 |
|
|
85.5 |
|
301 |
% |
||||||
Interest expense—net |
(69.2 |
) |
|
(79.9 |
) |
|
(13 |
)% |
|
(141.3 |
) |
|
(155.1 |
) |
(9 |
)% |
||||||
Non-operating income (expense)(1) |
(4.2 |
) |
|
(22.0 |
) |
|
(81 |
)% |
|
(0.7 |
) |
|
(30.6 |
) |
(98 |
)% |
||||||
Income (loss) before applicable income taxes |
163.1 |
|
|
11.3 |
|
|
NM |
|
|
200.8 |
|
|
(100.2 |
) |
NM |
|
||||||
Income tax expense (benefit) |
18.6 |
|
|
12.8 |
|
|
45 |
% |
|
18.2 |
|
|
(0.4 |
) |
NM |
|
||||||
Net income (loss) |
144.5 |
|
|
(1.5 |
) |
|
NM |
|
|
182.6 |
|
|
(99.8 |
) |
NM |
|
||||||
Less: Net income attributable to non-controlling interests |
(1.2 |
) |
|
(1.4 |
) |
|
(14 |
)% |
|
(2.9 |
) |
|
(0.7 |
) |
314 |
% |
||||||
Net income (loss) attributable to Worldpay, Inc. |
$ |
143.3 |
|
|
$ |
(2.9 |
) |
|
NM |
|
|
$ |
179.7 |
|
|
$ |
(100.5 |
) |
NM |
|
||
Net income (loss) per share attributable to Worldpay, Inc. Class A common stock: |
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic |
$ |
0.46 |
|
|
$ |
(0.01 |
) |
|
NM |
|
|
$ |
0.59 |
|
|
$ |
(0.35 |
) |
NM |
|
||
Diluted(2) |
$ |
0.46 |
|
|
$ |
(0.01 |
) |
|
NM |
|
|
$ |
0.58 |
|
|
$ |
(0.35 |
) |
NM |
|
||
Shares used in computing net income (loss) per share of Class A common stock: |
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic |
311,029,474 |
|
|
296,204,304 |
|
|
|
|
306,562,681 |
|
|
284,868,484 |
|
|
||||||||
Diluted |
313,083,818 |
|
|
296,204,304 |
|
|
|
|
312,834,187 |
|
|
284,868,484 |
|
|
||||||||
_______________
(1) |
Non-operating income (expense) primarily consists of other income and expense items outside of the Company’s operating activities. |
(2)
|
Up until March 18, 2019, we were structured as a C corporation and Worldpay Holding’s structure as a pass-through entity for tax purposes, the numerator in the diluted net income per share calculation was adjusted to reflect the Company’s income tax expense at an expected effective tax rate assuming the conversion of the Class B units of Worldpay Holding into shares of our Class A common stock. During the three and six months ended June 30, 2018, approximately 15.0 million and 15.1 million, respectively, weighted average Class B units of Worldpay Holding were excluded in computing diluted net income per share because including them would have an antidilutive effect. As the Class B units of Worldpay Holding were not included, the numerator used in the calculation of diluted net income per share was equal to the numerator used in the calculation of basic net income per share for the three and six months ended June 30, 2018. Additionally, due to the net loss for the three and six months ended June 30, 2018, any remaining potentially dilutive securities were also excluded from the denominator in computing dilutive net income per share. Since March 18, 2019, all Class B units are no longer outstanding and for the three months ended June 30, 2019, the methodology above is not applicable and diluted earnings per share is computed by dividing net income attributable to Worldpay, Inc. by the weighted-average shares outstanding during the period and the impact of securities that have a diluted effect on earnings per share. |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|||||||||
(Loss) income before applicable income taxes |
$ |
— |
|
|
$ |
— |
|
|
$ |
200.8 |
|
|
$ |
— |
|
|
Taxes |
— |
|
|
— |
|
|
19.9 |
|
|
— |
|
|||||
Net income (loss) |
$ |
143.3 |
|
|
$ |
(2.9 |
) |
|
$ |
180.9 |
|
|
$ |
(100.5 |
) |
|
Diluted shares |
|
313,083,818 |
|
|
|
296,204,304 |
|
|
|
312,834,187 |
|
|
|
284,868,484 |
|
|
Diluted EPS |
$ |
0.46 |
|
|
$ |
(0.01 |
) |
|
$ |
0.58 |
|
|
$ |
(0.35 |
) |
|
Schedule 2 Worldpay, Inc. Adjusted Net Income (Unaudited) (in millions, except share data) |
|||||||||||||||||||||
|
Three Months Ended |
|
|
|
Six Months Ended |
|
|
||||||||||||||
|
June 30, |
|
June 30, |
|
|
|
June 30, |
|
June 30, |
|
|
||||||||||
|
2019 |
|
2018 |
|
% Change |
|
2019 |
|
2018 |
|
% Change |
||||||||||
Income (loss) before applicable income taxes |
$ |
163.1 |
|
|
$ |
11.3 |
|
|
NM |
|
|
$ |
200.8 |
|
|
$ |
(100.2 |
) |
|
NM |
|
Non-GAAP Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Transition, acquisition and integration costs(1) (2) |
46.2 |
|
|
52.8 |
|
|
(13 |
)% |
|
88.6 |
|
|
230.2 |
|
|
(62 |
)% |
||||
Share-based compensation(2) |
24.6 |
|
|
39.0 |
|
|
(37 |
)% |
|
57.6 |
|
|
56.2 |
|
|
2 |
% |
||||
Intangible amortization and depreciation expense (2) (3) |
215.1 |
|
|
252.7 |
|
|
(15 |
)% |
|
441.3 |
|
|
425.5 |
|
|
4 |
% |
||||
Non-operating (income) expense(4) |
4.2 |
|
|
22.0 |
|
|
(81 |
)% |
|
0.7 |
|
|
30.6 |
|
|
(98 |
)% |
||||
Non-GAAP adjusted income before applicable income taxes |
453.2 |
|
|
377.8 |
|
|
20 |
% |
|
789.0 |
|
|
642.3 |
|
|
23 |
% |
||||
Less: Adjustments |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted tax expense(5) |
65.1 |
|
|
50.3 |
|
|
29 |
% |
|
107.5 |
|
|
77.8 |
|
|
38 |
% |
||||
Adjusted tax rate |
14 |
% |
|
13 |
% |
|
|
|
14 |
% |
|
12 |
% |
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other(6) |
1.0 |
|
|
0.4 |
|
|
150 |
% |
|
1.4 |
|
|
0.7 |
|
|
100 |
% |
||||
Adjusted net income |
$ |
387.1 |
|
|
$ |
327.1 |
|
|
18 |
% |
|
$ |
680.1 |
|
|
$ |
563.8 |
|
|
21 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted net income per share |
$ |
1.24 |
|
|
$ |
1.04 |
|
|
19 |
% |
|
$ |
2.17 |
|
|
$ |
1.87 |
|
|
16 |
% |
Adjusted shares outstanding(7) |
313,083,818 |
|
|
313,431,291 |
|
|
|
|
312,834,187 |
|
|
302,127,796 |
|
|
|
||||||
Non-GAAP and Adjusted Financial Measures
This schedule presents non-GAAP and adjusted financial measures, which are important financial performance measures for the Company, but are not financial measures as defined by GAAP. Such financial measures should not be considered as alternatives to GAAP, and such measures may not be comparable to those reported by other companies.
_______________
| Adjusted net income is derived from GAAP income before applicable income taxes and adjusted for the following items described below: | |
(1) |
Represents acquisition and integration costs incurred in connection with our acquisitions, charges related to employee terminations and other transition activities. |
(2) |
Below are the adjustments to Other operating costs, General and administrative and Depreciation and amortization. |
|
Three Months Ended June 30, 2019 |
|
Three Months Ended June 30, 2018 |
||||||||||||||||||||
|
Transition,
|
|
Share-Based
|
|
Intangible
|
|
Transition,
|
|
Share-Based
|
|
Intangible
|
||||||||||||
Other operating costs |
$ |
26.0 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
27.0 |
|
|
$ |
— |
|
|
$ |
— |
|
General and administrative |
20.2 |
|
|
24.6 |
|
|
— |
|
|
25.8 |
|
|
39.0 |
|
|
— |
|
||||||
Depreciation and amortization |
— |
|
|
— |
|
|
215.1 |
|
|
— |
|
|
— |
|
|
252.7 |
|
||||||
Total adjustments |
$ |
46.2 |
|
|
$ |
24.6 |
|
|
$ |
215.1 |
|
|
$ |
52.8 |
|
|
$ |
39.0 |
|
|
$ |
252.7 |
|
|
Six Months Ended June 30, 2019 |
|
Six Months Ended June 30, 2018 |
||||||||||||||||||||
|
Transition,
|
|
Share-Based
|
|
Intangible
|
|
Transition,
|
|
Share-Based
|
|
Intangible
|
||||||||||||
Other operating costs |
$ |
46.5 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
37.2 |
|
|
$ |
— |
|
|
$ |
— |
|
General and administrative |
42.1 |
|
|
57.6 |
|
|
— |
|
|
193.0 |
|
|
56.2 |
|
|
— |
|
||||||
Depreciation and amortization |
— |
|
|
— |
|
|
441.3 |
|
|
— |
|
|
— |
|
|
425.5 |
|
||||||
Total adjustments |
$ |
88.6 |
|
|
$ |
57.6 |
|
|
$ |
441.3 |
|
|
$ |
230.2 |
|
|
$ |
56.2 |
|
|
$ |
425.5 |
|
(3) |
Represents amortization of intangible assets acquired through business combinations and customer portfolio and related asset acquisitions as well as depreciation of acquired software. |
(4) |
See note (1) in Schedule 1. |
(5) |
Represents adjusted income tax expense to reflect a projected effective tax rate of 20.1% for 2019 and 19.8% for 2018, including the tax effect of adjustments described above. Adjusted tax expense includes tax benefits due to: (1) the amortization of intangible assets and other tax attributes resulting from or acquired with our acquisitions, (2) the tax basis step up associated with our separation from Fifth Third Bank and (3) the purchase or exchange of Class B units of Worldpay Holding, net of payment obligations under tax receivable agreements. The effective tax rate is expected to remain at 20.1% for the remainder of 2019. |
(6) |
Represents the non-controlling interest, net of adjusted income tax expense, associated with a consolidated joint venture. |
(7) |
The adjusted shares outstanding include 15.0 million and 15.1 million of weighted average Class B units that are excluded from the GAAP dilutive net income per share calculation for the three and six months ended June 30, 2018. Additionally, the three and six months ended June 30, 2018 also include other potentially dilutive securities that are excluded from the GAAP dilutive net income per share calculation. As of June 30, 2019 all Class B units have been converted to Class A common stock and are therefore included in the Company’s shares outstanding. |
Schedule 3 Worldpay, Inc. Segment Information (Unaudited) (in millions) |
||||||||||
Technology Solutions |
||||||||||
|
Three Months Ended June 30, |
|
|
|||||||
|
2019 |
|
2018 |
|
% Change |
|||||
Revenue |
$ |
466.2 |
|
|
$ |
401.6 |
|
|
16 |
% |
Sales and marketing |
124.6 |
|
|
98.1 |
|
|
27 |
% |
||
Segment profit |
$ |
341.6 |
|
|
$ |
303.5 |
|
|
13 |
% |
|
Six Months Ended June 30, |
|
|
|||||||
|
2019 |
|
2018 |
|
% Change |
|||||
Revenue |
$ |
893.5 |
|
|
$ |
738.0 |
|
|
21 |
% |
Sales and marketing |
243.0 |
|
|
194.0 |
|
|
25 |
% |
||
Segment profit |
$ |
650.5 |
|
|
$ |
544.0 |
|
|
20 |
% |
Merchant Solutions |
||||||||||
|
Three Months Ended June 30, |
|
|
|||||||
|
2019 |
|
2018 |
|
% Change |
|||||
Revenue |
$ |
520.0 |
|
|
$ |
520.4 |
|
|
— |
% |
Sales and marketing |
172.9 |
|
|
179.0 |
|
|
(3 |
)% |
||
Segment profit |
$ |
347.1 |
|
|
$ |
341.4 |
|
|
2 |
% |
|
Six Months Ended June 30, |
|
|
|||||||
|
2019 |
|
2018 |
|
% Change |
|||||
Revenue |
$ |
979.4 |
|
|
$ |
952.6 |
|
|
3 |
% |
Sales and marketing |
338.9 |
|
|
342.8 |
|
|
(1 |
)% |
||
Segment profit |
$ |
640.5 |
|
|
$ |
609.8 |
|
|
5 |
|
Issuer Solutions |
||||||||||
|
Three Months Ended June 30, |
|
|
|||||||
|
2019 |
|
2018 |
|
% Change |
|||||
Revenue |
$ |
86.8 |
|
|
$ |
84.8 |
|
|
2 |
% |
Sales and marketing |
6.5 |
|
|
6.3 |
|
|
3 |
% |
||
Segment profit |
$ |
80.3 |
|
|
$ |
78.5 |
|
|
2 |
% |
|
Six Months Ended June 30, |
|
|
|||||||
|
2019 |
|
2018 |
|
% Change |
|||||
Revenue |
$ |
170.1 |
|
|
$ |
166.9 |
|
|
2 |
% |
Sales and marketing |
13.0 |
|
|
12.6 |
|
|
3 |
% |
||
Segment profit |
$ |
157.1 |
|
|
$ |
154.3 |
|
|
2 |
% |
Schedule 4 Worldpay, Inc. Condensed Consolidated Statements of Financial Position (Unaudited) (in millions) |
||||||||
|
|
June 30, 2019 |
|
December 31, 2018 |
||||
Assets |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
288.6 |
|
|
$ |
196.5 |
|
Accounts receivable—net |
|
1,681.0 |
|
|
1,694.8 |
|
||
Settlement assets and merchant float |
|
5,126.8 |
|
|
3,132.3 |
|
||
Prepaid expenses |
|
91.5 |
|
|
80.0 |
|
||
Other |
|
567.6 |
|
|
526.1 |
|
||
Total current assets |
|
7,755.5 |
|
|
5,629.7 |
|
||
|
|
|
|
|
||||
Property, equipment and software—net |
|
1,105.5 |
|
|
1,074.1 |
|
||
Intangible assets—net |
|
2,740.9 |
|
|
3,127.8 |
|
||
Goodwill |
|
14,100.3 |
|
|
14,137.9 |
|
||
Deferred taxes |
|
1,176.2 |
|
|
789.9 |
|
||
Other assets |
|
219.0 |
|
|
129.1 |
|
||
Total assets |
|
$ |
27,097.4 |
|
|
$ |
24,888.5 |
|
|
|
|
|
|
||||
Liabilities and equity |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Accounts payable and accrued expenses |
|
$ |
1,276.8 |
|
|
$ |
1,188.7 |
|
Settlement obligations |
|
5,918.5 |
|
|
3,723.6 |
|
||
Current portion of notes payable |
|
218.5 |
|
|
225.7 |
|
||
Current portion of tax receivable agreement obligations |
|
28.5 |
|
|
73.1 |
|
||
Deferred income |
|
30.2 |
|
|
25.1 |
|
||
Current maturities of finance lease obligations |
|
20.0 |
|
|
22.7 |
|
||
Other |
|
658.2 |
|
|
630.3 |
|
||
Total current liabilities |
|
8,150.7 |
|
|
5,889.2 |
|
||
Long-term liabilities: |
|
|
|
|
||||
Notes payable |
|
6,944.0 |
|
|
7,622.1 |
|
||
Tax receivable agreement obligations |
|
890.2 |
|
|
590.8 |
|
||
Finance lease obligations |
|
24.3 |
|
|
34.3 |
|
||
Deferred taxes |
|
345.1 |
|
|
473.7 |
|
||
Other |
|
197.3 |
|
|
74.4 |
|
||
Total long-term liabilities |
|
8,400.9 |
|
|
8,795.3 |
|
||
Total liabilities |
|
16,551.6 |
|
|
14,684.5 |
|
||
|
|
|
|
|
||||
Commitments and contingencies |
|
|
|
|
||||
Equity: |
|
|
|
|
||||
Total equity (1) |
|
10,545.8 |
|
|
10,204.0 |
|
||
Total liabilities and equity |
|
$ |
27,097.4 |
|
|
$ |
24,888.5 |
|
_______________
(1) |
Includes equity attributable to non-controlling interests. |
||
Schedule 5 Worldpay, Inc. Consolidated Statements of Cash Flows (Unaudited) (in millions) |
|||||||
|
Six Months Ended |
||||||
|
June 30, 2019 |
|
June 30, 2018 |
||||
Operating Activities: |
|
|
|
||||
Net income (loss) |
$ |
182.6 |
|
|
$ |
(99.8 |
) |
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization expense |
517.8 |
|
|
495.1 |
|
||
Amortization of customer incentives |
15.1 |
|
|
12.6 |
|
||
Amortization and write-off of debt issuance costs |
1.9 |
|
|
72.9 |
|
||
Gain on foreign currency forward |
— |
|
|
(35.9 |
) |
||
Share-based compensation expense |
57.6 |
|
|
56.2 |
|
||
Deferred tax (benefit) expense |
(28.6 |
) |
|
27.3 |
|
||
Tax receivable agreements non-cash items |
(3.4 |
) |
|
(6.4 |
) |
||
Other |
(1.5 |
) |
|
1.2 |
|
||
Change in operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
9.1 |
|
|
(50.3 |
) |
||
Net settlement assets and obligations |
20.6 |
|
|
105.7 |
|
||
Prepaid and other assets |
19.4 |
|
|
(33.4 |
) |
||
Accounts payable and accrued expenses |
113.4 |
|
|
(159.6 |
) |
||
Other liabilities |
31.5 |
|
|
(6.8 |
) |
||
Net cash provided by operating activities |
935.5 |
|
|
378.8 |
|
||
Investing Activities: |
|
|
|
||||
Purchases of property and equipment |
(175.5 |
) |
|
(103.1 |
) |
||
Acquisition of customer portfolios and related assets and other |
(12.7 |
) |
|
(51.1 |
) |
||
Purchase of interest rate caps |
— |
|
|
(8.1 |
) |
||
Proceeds from foreign currency forward |
— |
|
|
71.5 |
|
||
Cash acquired in acquisitions, net of cash used |
— |
|
|
1,405.8 |
|
||
Other |
9.1 |
|
|
— |
|
||
Net cash (used in) provided by investing activities |
(179.1 |
) |
|
1,315.0 |
|
||
Financing Activities: |
|
|
|
||||
Proceeds from issuance of long-term debt |
— |
|
|
2,951.8 |
|
||
Borrowings on revolving credit facility |
4,204.0 |
|
|
2,598.0 |
|
||
Repayment of revolving credit facility |
(4,254.0 |
) |
|
(2,823.0 |
) |
||
Repayment of debt and finance lease obligations |
(643.5 |
) |
|
(2,590.3 |
) |
||
Payment of debt issuance costs |
— |
|
|
(91.1 |
) |
||
Proceeds from issuance of Class A common stock under employee stock plans |
16.7 |
|
|
14.9 |
|
||
Repurchase of Class A common stock (to satisfy tax withholding obligations) |
(20.0 |
) |
|
(11.7 |
) |
||
Settlement and payments under certain tax receivable agreements |
(69.7 |
) |
|
(140.6 |
) |
||
Distributions to non-controlling interests |
(3.3 |
) |
|
(6.4 |
) |
||
Net cash provided by (used in) financing activities |
(769.8 |
) |
|
(98.4 |
) |
||
Net (decrease) increase in cash and cash equivalents |
(13.4 |
) |
|
1,595.4 |
|
||
Cash and cash equivalents—Beginning of period |
2,581.3 |
|
|
1,272.2 |
|
||
Effect of exchange rate changes on cash |
(18.7 |
) |
|
(139.2 |
) |
||
Cash and cash equivalents—End of period |
$ |
2,549.2 |
|
|
$ |
2,728.4 |
|
Cash Payments: |
|
|
|
||||
Interest |
$ |
125.3 |
|
|
$ |
149.3 |
|
Income taxes |
22.6 |
|
|
6.2 |
|
||
Non-cash Items: |
|
|
|
||||
Issuance of tax receivable agreements |
$ |
327.9 |
|
|
$ |
120.9 |
|
(to be continued) |
|||||||
Schedule 5 Worldpay, Inc. Consolidated Statements of Cash Flows (Continued) (Unaudited) (in millions) |
||||||||
Reconciliation of cash and cash equivalents to the Condensed Consolidated Statements of Financial Position |
||||||||
|
|
Six Months Ended |
||||||
|
|
June 30, 2019 |
|
June 30, 2018 |
||||
Cash and cash equivalents on the Condensed Consolidated Financial Statements |
|
$ |
288.6 |
|
|
$ |
367.7 |
|
Other restricted cash (in other current assets) |
|
546.0 |
|
|
487.5 |
|
||
Merchant float (in settlement assets and merchant float) |
|
1,714.6 |
|
|
1,873.2 |
|
||
Total cash and cash equivalents per the Consolidated Statements of Cash Flows |
|
$ |
2,549.2 |
|
|
$ |
2,728.4 |
|
Schedule 6 Worldpay, Inc. Reconciliation of GAAP Net Income to Adjusted EBITDA (Unaudited) (in millions) |
|||||||||||||||||||||
|
Three Months Ended June 30, |
|
|
|
Six Months Ended June 30, |
|
|
||||||||||||||
|
2019 |
|
2018 |
|
% Change |
|
2019 |
|
2018 |
|
% Change |
||||||||||
Net income (loss) |
$ |
144.5 |
|
|
$ |
(1.5 |
) |
|
NM |
|
|
$ |
182.6 |
|
|
$ |
(99.8 |
) |
|
NM |
|
Income tax expense (benefit) |
18.6 |
|
|
12.8 |
|
|
45 |
% |
|
18.2 |
|
|
(0.4 |
) |
|
NM |
|
||||
Non-operating (income) expense(1) |
4.2 |
|
|
22.0 |
|
|
(81 |
)% |
|
0.7 |
|
|
30.6 |
|
|
(98 |
)% |
||||
Interest expense—net |
69.2 |
|
|
79.9 |
|
|
(13 |
)% |
|
141.3 |
|
|
155.1 |
|
|
(9 |
)% |
||||
Share-based compensation |
24.6 |
|
|
39.0 |
|
|
(37 |
)% |
|
57.6 |
|
|
56.2 |
|
|
2 |
% |
||||
Transition, acquisition and integration costs(2) |
46.2 |
|
|
52.8 |
|
|
(13 |
)% |
|
88.6 |
|
|
230.2 |
|
|
(62 |
)% |
||||
Depreciation and amortization |
253.4 |
|
|
287.9 |
|
|
(12 |
)% |
|
517.8 |
|
|
495.1 |
|
|
5 |
% |
||||
Adjusted EBITDA |
$ |
560.7 |
|
|
$ |
492.9 |
|
|
14 |
% |
|
$ |
1,006.8 |
|
|
$ |
867.0 |
|
|
16 |
% |
Non-GAAP Financial Measures
This schedule presents adjusted EBITDA, which is an important financial performance measure for the Company, but is not a financial measure as defined by GAAP. Such financial measure should not be considered as an alternative to GAAP net income, and such measure may not be comparable to those reported by other companies.
_______________
(1) |
See note (1) in Schedule 1. |
||
(2) |
See notes (1) and (2) in Schedule 2. |
||
FIDELITY NATIONAL INFORMATION SERVICES, INC.
COMBINED COMPANY PRELIMINARY SUPPLEMENTAL INFORMATION — UNAUDITED
Exhibit 99.3
Worldpay, Inc. Acquisition
On March 17, 2019, FIS, Wrangler Merger Sub, Inc., a wholly owned subsidiary of FIS (“Merger Sub”), and Worldpay, Inc. (“Worldpay”) entered into an Agreement and Plan of Merger (the “merger agreement”) pursuant to which Merger Sub would merge with and into Worldpay (the “merger”), with Worldpay surviving the merger and becoming a wholly owned subsidiary of FIS (collectively, the "Worldpay acquisition"). On July 31, 2019, FIS completed the acquisition of Worldpay, and Worldpay's results of operations and financial position will be included in the consolidated results of FIS from and after the date of acquisition.
Treatment of Share-Based Compensation
Historically, Worldpay has added back share-based compensation to its adjusted EBITDA and adjusted net earnings non-GAAP measures while FIS has not added back share-based compensation to its adjusted EBITDA and adjusted net earnings non-GAAP measures. FIS intends to keep its current definition of adjusted EBITDA and adjusted net earnings following the completion of the Worldpay acquisition. The schedules included in this Exhibit 99.3 conform to the FIS definition of adjusted EBITDA and adjusted net earnings and therefore do not add back Worldpay share-based compensation expense to the Adjusted combined EBITDA and Adjusted combined net earnings figures for all periods presented. This amount was approximately $125 million for the full year ended 2018 and $58 million for the first six months of 2019.
Supplemental Financial Data
Due to the financial impact of the transaction described above, FIS management desires to furnish investors with the additional information set forth herein to improve the understanding of the Company’s operating performance. The purpose of the schedules included in this Exhibit 99.3 is to recalculate certain non-GAAP measures of the Company’s historical financial performance on a combined company basis for the first and second quarters in 2019, each of the quarters in 2018 and for the full year 2018. The schedules have been prepared by making certain adjustments to the sum of historical Worldpay financial information and historical FIS financial information. The adjustments are discussed in the notes to the schedules. The content of the schedules is as follows:
- Exhibit A shows the historical adjusted revenue, adjusted EBITDA, and adjusted net earnings on a total combined company basis, including combined company non-GAAP adjustments;
- Exhibit B shows the historical adjusted combined segment revenue under the new segment reporting structure that the Company will use on a go forward basis and organic revenue adjustments to arrive at adjusted combined revenue organic base.
The unaudited adjusted combined financial information is presented for illustrative purposes only and does not reflect the financial results of the combined companies had the companies actually been combined at the beginning of 2018 and is not necessarily indicative of the future results of operations of the Company. The unaudited adjusted combined financial information does not consider the impact of possible business model changes nor any potential impacts of current market conditions on revenue, expense efficiencies and other factors. In addition, the unaudited adjusted combined financial information does not reflect the impact of any purchase accounting adjustments that would arise from the Worldpay acquisition as those impacts would be eliminated in the preparation of adjusted combined financial information.
The unaudited adjusted combined financial information is not pro forma information prepared in accordance with Article 11 of SEC regulation S-X, and the preparation of information in accordance with Article 11 would result in a significantly different presentation.
Although this Exhibit 99.3 contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company believes that it provides information that may be useful in understanding its results of operations, including a reasonable basis of comparison with its results for post-acquisition periods. FIS’ management uses these non-GAAP measures in part to assess the Company’s performance. Therefore, management believes these non-GAAP measures to be relevant and useful information for investors. These non-GAAP measures should not be used in isolation or as a substitute for other measures of financial performance reported in accordance with GAAP. In addition, the Company’s non-GAAP measures may be calculated differently from similarly titled measures of other companies.
Exhibit Index |
||
|
|
|
Exhibit A |
|
Adjusted Combined Consolidated Revenue, EBITDA, and Net Earnings — Unaudited |
|
|
|
Exhibit B |
|
Adjusted Combined Segment Revenue — Unaudited |
FIDELITY NATIONAL INFORMATION SERVICES, INC. ADJUSTED COMBINED CONSOLIDATED REVENUE, EBITDA, AND NET EARNINGS — UNAUDITED |
||||||||||||||||||||||||||||
Exhibit A |
||||||||||||||||||||||||||||
|
|
Q1 2018 (1) |
|
Q2 2018 |
|
Q3 2018 |
|
Q4 2018 |
|
FY 2018 (1) |
|
Q1 2019 |
|
Q2 2019 |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenue |
|
$ |
2,066 |
|
|
$ |
2,106 |
|
|
$ |
2,084 |
|
|
$ |
2,167 |
|
|
$ |
8,423 |
|
|
$ |
2,057 |
|
|
$ |
2,112 |
|
Worldpay revenue |
|
915 |
|
|
1,007 |
|
|
1,018 |
|
|
1,050 |
|
|
3,990 |
|
|
970 |
|
|
1,073 |
|
|||||||
Acquisition deferred revenue (6) |
|
2 |
|
|
1 |
|
|
1 |
|
|
— |
|
|
4 |
|
|
— |
|
|
— |
|
|||||||
Adjusted combined revenue (2) |
|
$ |
2,983 |
|
|
$ |
3,114 |
|
|
$ |
3,103 |
|
|
$ |
3,217 |
|
|
$ |
12,417 |
|
|
$ |
3,027 |
|
|
$ |
3,185 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Operating income |
|
294 |
|
|
353 |
|
|
342 |
|
|
469 |
|
|
1,458 |
|
|
315 |
|
|
391 |
|
|||||||
Worldpay operating income |
|
(63 |
) |
|
113 |
|
|
78 |
|
|
175 |
|
|
303 |
|
|
106 |
|
|
237 |
|
|||||||
Adjusted combined operating income (3) |
|
231 |
|
|
466 |
|
|
420 |
|
|
644 |
|
|
1,761 |
|
|
421 |
|
|
628 |
|
|||||||
Combined non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Depreciation and amortization |
|
566 |
|
|
642 |
|
|
683 |
|
|
632 |
|
|
2,523 |
|
|
632 |
|
|
621 |
|
|||||||
Acquisition, integration and other costs (4) |
|
291 |
|
|
102 |
|
|
63 |
|
|
93 |
|
|
549 |
|
|
88 |
|
|
81 |
|
|||||||
Asset impairments (5) |
|
— |
|
|
— |
|
|
95 |
|
|
— |
|
|
95 |
|
|
— |
|
|
— |
|
|||||||
Acquisition deferred revenue adjustment (6) |
|
2 |
|
|
1 |
|
|
1 |
|
|
— |
|
|
4 |
|
|
— |
|
|
— |
|
|||||||
Adjusted combined EBITDA (7) |
|
$ |
1,090 |
|
|
$ |
1,211 |
|
|
$ |
1,262 |
|
|
$ |
1,369 |
|
|
$ |
4,932 |
|
|
$ |
1,141 |
|
|
$ |
1,330 |
|
Adjusted combined EBITDA margin (8) |
|
36.5 |
% |
|
38.9 |
% |
|
40.7 |
% |
|
42.6 |
% |
|
39.7 |
% |
|
37.7 |
% |
|
41.8 |
% |
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net earnings |
|
$ |
182 |
|
|
$ |
212 |
|
|
$ |
154 |
|
|
$ |
299 |
|
|
$ |
847 |
|
|
$ |
148 |
|
|
$ |
154 |
|
Worldpay net earnings |
|
(138 |
) |
|
(3 |
) |
|
3 |
|
|
111 |
|
|
(27 |
) |
|
36 |
|
|
143 |
|
|||||||
Adjusted combined net earnings before non-GAAP adjustments (9) |
|
44 |
|
|
209 |
|
|
157 |
|
|
410 |
|
|
820 |
|
|
184 |
|
|
297 |
|
|||||||
Combined non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|||||||||||||
Purchase accounting amortization (10) |
|
363 |
|
|
438 |
|
|
471 |
|
|
406 |
|
|
1,678 |
|
|
399 |
|
|
390 |
|
|||||||
Acquisition, integration and other costs (4) |
|
291 |
|
|
102 |
|
|
63 |
|
|
93 |
|
|
549 |
|
|
143 |
|
|
92 |
|
|||||||
Asset impairments (5) |
|
— |
|
|
— |
|
|
95 |
|
|
— |
|
|
95 |
|
|
— |
|
|
— |
|
|||||||
Acquisition deferred revenue adjustment (6) |
|
2 |
|
|
1 |
|
|
1 |
|
|
— |
|
|
4 |
|
|
— |
|
|
— |
|
|||||||
Loss (gain) on sale of businesses and investments (11) |
|
(3 |
) |
|
1 |
|
|
54 |
|
|
3 |
|
|
55 |
|
|
6 |
|
|
— |
|
|||||||
Debt financing activities (12) |
|
— |
|
|
1 |
|
|
— |
|
|
— |
|
|
1 |
|
|
— |
|
|
102 |
|
|||||||
Equity method investment earnings (loss) (13) |
|
— |
|
|
7 |
|
|
4 |
|
|
4 |
|
|
15 |
|
|
7 |
|
|
4 |
|
|||||||
Non-operating (income) expense (14) |
|
9 |
|
|
22 |
|
|
4 |
|
|
8 |
|
|
43 |
|
|
(3 |
) |
|
4 |
|
|||||||
Adjusted tax expense (15) |
|
(45 |
) |
|
(31 |
) |
|
(49 |
) |
|
(70 |
) |
|
(195 |
) |
|
(37 |
) |
|
(42 |
) |
|||||||
(Provision) benefit for Income taxes on non-GAAP adjustments |
|
(58 |
) |
|
(48 |
) |
|
(67 |
) |
|
3 |
|
|
(170 |
) |
|
(57 |
) |
|
(56 |
) |
|||||||
Total non-GAAP adjustments |
|
559 |
|
|
493 |
|
|
576 |
|
|
447 |
|
|
2,075 |
|
|
458 |
|
|
494 |
|
|||||||
Adjusted combined net earnings (16) |
|
$ |
603 |
|
|
$ |
702 |
|
|
$ |
733 |
|
|
$ |
857 |
|
|
$ |
2,895 |
|
|
$ |
642 |
|
|
$ |
791 |
|
Amounts in table may not sum or calculate due to rounding. |
||||||||||||||||||||||||||||
See notes to Exhibit A and B. |
||||||||||||||||||||||||||||
FIDELITY NATIONAL INFORMATION SERVICES, INC. ADJUSTED COMBINED SEGMENT REVENUE — UNAUDITED (In millions) |
||||||||||||||||||||||||||||
Exhibit B |
||||||||||||||||||||||||||||
|
|
Q1 2018 (1) |
|
Q2 2018 |
|
Q3 2018 |
|
Q4 2018 |
|
FY 2018 |
|
Q1 2019 |
|
Q2 2019 |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Merchant Solutions |
|
$ |
892 |
|
|
$ |
1,017 |
|
|
$ |
978 |
|
|
$ |
1,031 |
|
|
$ |
3,918 |
|
|
$ |
951 |
|
|
$ |
1,098 |
|
Banking Solutions |
|
1,477 |
|
|
1,495 |
|
|
1,524 |
|
|
1,564 |
|
|
6,060 |
|
|
1,504 |
|
|
1,493 |
|
|||||||
Capital Market Solutions |
|
596 |
|
|
584 |
|
|
589 |
|
|
622 |
|
|
2,391 |
|
|
572 |
|
|
594 |
|
|||||||
Corporate and Other |
|
18 |
|
|
18 |
|
|
12 |
|
|
— |
|
|
48 |
|
|
— |
|
|
— |
|
|||||||
Adjusted combined revenue |
|
$ |
2,983 |
|
|
$ |
3,114 |
|
|
$ |
3,103 |
|
|
$ |
3,217 |
|
|
$ |
12,417 |
|
|
$ |
3,027 |
|
|
$ |
3,185 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Organic adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Merchant Solutions |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|||||||
Banking Solutions |
|
(67 |
) |
|
(61 |
) |
|
(60 |
) |
|
(70 |
) |
|
(258 |
) |
|
— |
|
|
— |
|
|||||||
Capital Market Solutions |
|
(1 |
) |
|
— |
|
|
— |
|
|
— |
|
|
(1 |
) |
|
— |
|
|
— |
|
|||||||
Corporate and Other |
|
(18 |
) |
|
(18 |
) |
|
(12 |
) |
|
— |
|
|
(48 |
) |
|
— |
|
|
— |
|
|||||||
Adjusted combined revenue organic adjustments (17) |
|
(86 |
) |
|
(79 |
) |
|
(72 |
) |
|
(70 |
) |
|
(307 |
) |
|
— |
|
|
— |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Organic base: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Merchant Solutions |
|
892 |
|
|
1,017 |
|
|
978 |
|
|
1,031 |
|
|
3,918 |
|
|
951 |
|
|
1,098 |
|
|||||||
Banking Solutions |
|
1,410 |
|
|
1,434 |
|
|
1,464 |
|
|
1,494 |
|
|
5,802 |
|
|
1,504 |
|
|
1,493 |
|
|||||||
Capital Market Solutions |
|
595 |
|
|
584 |
|
|
589 |
|
|
622 |
|
|
2,390 |
|
|
572 |
|
|
594 |
|
|||||||
Corporate and Other |
|
1 |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
— |
|
|
— |
|
|||||||
Adjusted combined revenue organic base |
|
$ |
2,898 |
|
|
$ |
3,035 |
|
|
$ |
3,031 |
|
|
$ |
3,147 |
|
|
$ |
12,111 |
|
|
$ |
3,027 |
|
|
$ |
3,185 |
|
Amounts in table may not sum or calculate due to rounding. |
||||||||||||||||||||||||||||
See notes to Exhibits A and B. |
||||||||||||||||||||||||||||
FIDELITY NATIONAL INFORMATION SERVICES, INC. COMBINED COMPANY PRELIMINARY SUPPLEMENTAL INFORMATION — UNAUDITED |
|
Notes to Exhibits A and B. |
|
(1) |
Amounts include the 15-day stub period results between January 1, 2018 and January 15, 2018 for Worldpay Group plc prior to its acquisition by Worldpay. |
(2) |
Adjusted combined revenue consists of revenue, of both FIS and Worldpay, increased to reverse the purchase accounting deferred revenue adjustment made upon the acquisition by FIS of SunGard. As discussed in note (6) below, the deferred revenue adjustment represents revenue that would have been recognized in the normal course of business by SunGard under GAAP but was not recognized due to GAAP purchase accounting adjustments. |
(3) |
Adjusted combined operating income represents the operating income of both FIS and Worldpay, calculated based on the combined company revenue and operating expenses. |
(4) |
This item represents acquisition and integration costs primarily related to FIS’ acquisition of SunGard and Worldpay’s acquisition of Worldpay Group plc, and certain other costs including those associated with data center consolidation activities. |
(5) |
This item represents asset impairments for assets held for sale prior to being transferred to Banco Bradesco upon closing of the agreement to unwind the Brazilian Venture as well as impairments of the goodwill and contract intangible asset associated with the Brazilian Venture. |
(6) |
This item represents the impact of the purchase accounting adjustment to reduce SunGard's deferred revenues 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 normal course of business by SunGard under GAAP if FIS' acquisition had not occurred, but was not recognized due to GAAP purchase accounting requirements. |
(7) |
Adjusted combined EBITDA is EBITDA, earnings from continuing operations before interest, taxes, depreciation and amortization, excluding certain costs and other transactions which management deems non-operational in nature and are listed above, the removal of which improves comparability of operating results across reporting periods. |
(8) |
Adjusted combined EBITDA margin reflects adjusted combined EBITDA divided by adjusted combined revenue. |
(9) |
Adjusted combined net earnings before non-GAAP adjustments reflects combined company net earnings to shareholders. |
(10) |
This item represents purchase price amortization expense on all intangible assets acquired through various acquisitions, including customer relationships, contract value, trademarks and tradenames, non-compete agreements and technology assets acquired. The Company has excluded the impact of purchase accounting amortization of intangibles as such amounts can be significantly impacted by the timing and/or size of acquisitions. Although the Company excludes these amounts from its non-GAAP expenses, the Company believes that it is important for investors to understand that such intangible assets contribute to revenue generation. Purchase accounting amortization of intangible assets will recur in future periods until such intangible assets have been fully amortized. Any future acquisitions may result in purchase price amortization of future intangible assets. |
(11) |
This item represents the net pre-tax loss (gain) on sale of businesses and investments. |
(12) |
This item primarily represents the non-cash foreign currency impact of non-hedged Euro- and Pound Sterling-denominated notes issued to finance the Worldpay acquisition. |
(13) |
This item represents our equity method investment earnings or loss and is predominantly due to the Company's equity ownership interest in Cardinal Holdings, LP. |
(14) |
This item represents Worldpay’s non-operating income (expense) primarily consisting of other income and expense items outside of operating activities. |
(15) |
This item represents adjusted income tax expense to reflect a projected effective tax rate for the period for Worldpay, including the tax effect of Worldpay adjustments described above. Adjusted tax expense includes tax benefits due to (1) the amortization of intangible assets and other tax attributes resulting from or acquired with Worldpay’s acquisitions, (2) the tax basis step up associated with Worldpay’s separation from Fifth Third Bank and (3) the purchase or exchange of Class B units of Worldpay Holding, net of payment obligations under tax receivable agreements. |
(16) |
Adjusted combined net earnings represents combined company net earnings adjusted for the impacts of the items listed above. |
(17) |
Organic adjustments represent the removal of revenue related to business divestitures for the periods presented. |
