FIS™ (FIS), a global leader in banking and payments technology as well as consulting and outsourcing solutions, today reported that first quarter revenue increased two percent on a reported basis to $1.6 billion from $1.5 billion a year earlier and five percent on a constant currency basis.
GAAP net earnings from continuing operations attributable to common stockholders was $114 million, or $0.40 per diluted share, compared to $157 million, or $0.54 per diluted share in the prior year quarter.
Non-GAAP adjusted net earnings from continuing operations attributable to common stockholders was $186 million for the quarter, or $0.65 per share. First quarter 2015 non-GAAP adjusted net earnings from continuing operations excludes acquisition-related purchase amortization of $0.12 per share, global re-structuring costs of $0.10 per share and costs pertaining to acquisition, integration and severance of $0.03 per share. Adjusted EBITDA decreased to $425 million in the first quarter 2015, down five percent from $448 million in the prior year quarter, while adjusted EBITDA margin was 27.4 percent compared to 29.3 percent in the prior year quarter.
“We continued to grow revenue and return value to shareholders demonstrating the consistency of our business model,” stated Gary Norcross, president and chief executive office, FIS. “Advancing this model through our new segmentation will better position us to leverage our scale, services and solutions more effectively to propel our clients’ business forward.”
Definitions of non-GAAP financial measures and reconciliations of non-GAAP measures to related GAAP measures are provided in subsequent sections of the press release narrative and supplemental schedules.
The following is a review of first quarter 2015 results by segment:
Integrated Financial Solutions:
Revenue on a reported basis grew two percent to $969 million, from $946 million in the first quarter 2014. Adjusted EBITDA decreased to $379 million from $381 million in the first quarter 2014, while adjusted EBITDA margin was 39.1 percent compared to 40.2 percent a year earlier primarily reflecting lower termination fees in the current year period.
Global Financial Solutions:
On a reported basis, revenue increased one percent to $587 million from $584 million in the first quarter 2014. Revenue increased eight percent on a constant currency basis. Adjusted EBITDA decreased 14 percent to $90 million from $105 million in the first quarter of 2014, while adjusted EBITDA margin decreased 260 basis points to 15.4 percent.
Corporate costs, as adjusted, totaled $44 million in the first quarter 2015 compared to $38 million in the prior year quarter. Interest expense, net of interest income, decreased to $37 million from $41 million in the first quarter 2014, reflecting lower costs resulting from debt refinancing activities. The effective tax rate was approximately 33 percent for both periods.
Balance Sheet and Cash Flow
Cash and cash equivalents totaled $489 million as of March 31, 2015, while debt outstanding totaled $5.2 billion.
Net cash provided by operations was $231 million and adjusted cash flow from operations was $315 million in the first quarter of 2015. Capital expenditures totaled $101 million resulting in free cash flow of $214 million in the first quarter 2015.
FIS repurchased 2.2 million common shares at a total cost of $150 million in the first quarter 2015. Approximately $1.4 billion remained under the existing share repurchase authorization as of March 31, 2015. The Company paid shareholder dividends of $73 million in the first quarter of 2015.
FIS’ full year 2015 guidance is as follows:
Reported revenue growth of 1 to 3 percent
Adjusted EPS from continuing operations of $3.27 to $3.37, an increase of 6 to 9 percent compared to 2014
Free cash flow is expected to approximate adjusted net earnings.
FIS will host a webcast on April 30, 2015, to discuss first quarter 2015 results beginning at 8:30 a.m. ET. To listen to the live event and to access a supplemental slide presentation, go to the Investor Relations section at www.fisglobal.com and click on “News and Events.” A webcast replay will be available on FIS’ Investor Relations website, and a telephone replay will be available through May 15, 2015 by dialing 800.475.6701 (U.S.) or 320.365.3844 (International). The access code is 357369. To access a .PDF version of this release and accompanying financial tables, go to www.investor.fisglobal.com.
Full figures available here.