10-KPeriod: FY2003

Fidelity National Information Services, Inc. Annual Report, Year Ended Dec 31, 2003

Filed February 17, 2004For Securities:FIS

Summary

Fidelity National Information Services, Inc. (FIS), operating as Certegy Inc. during this period, reported steady revenue growth in 2003, reaching $1.015 billion, a 0.7% increase over the previous year. The company primarily operates in two segments: Card Services and Check Services. While Card Services revenue saw a slight decrease due to the loss of a major client in its merchant processing business and a large card operation in Brazil, Check Services experienced robust growth, offsetting these declines. The company demonstrated improved operating income, rising 1.6% to $154.4 million, and a notable increase in diluted earnings per share (EPS) to $1.40, up 7.7%. Certegy also initiated shareholder returns by declaring its first quarterly dividend in 2003, signaling a focus on shareholder value while managing its business operations effectively.

Key Highlights

  • 1Consolidated revenues reached $1.015 billion in 2003, a 0.7% increase from 2002.
  • 2Operating income grew by 1.6% to $154.4 million.
  • 3Diluted earnings per share (EPS) increased by 7.7% to $1.40.
  • 4Card Services revenue experienced a 2.5% decrease, primarily due to client losses in Brazil and merchant processing.
  • 5Check Services revenue grew by 6.9%, driven by increased volumes and new customer acquisitions.
  • 6The company initiated quarterly dividends in 2003.
  • 7Certegy repurchased $73.6 million of its common stock in 2003.

Frequently Asked Questions

In 2003, Certegy's revenue was primarily driven by its two segments: Card Services and Check Services. While Card Services saw a slight decline due to client losses in Brazil and the merchant processing sector, Check Services experienced significant growth, contributing positively to the overall revenue performance. The strengthening of foreign currencies, particularly the British pound and Australian dollar, also had a positive impact on reported U.S. dollar revenues.

Certegy's profitability saw an improvement in 2003. Operating income increased by 1.6% to $154.4 million, and net income rose by 2.7% to $92.4 million. Diluted earnings per share (EPS) showed a stronger increase of 7.7%, reaching $1.40. This growth was supported by effective cost management, despite some "other charges" incurred during the year.

Certegy's strategy focuses on leveraging its competitive strengths to increase market share in both the U.S. and international markets. Key initiatives include expanding its card processing business in the independent community bank and credit union segments, growing its customer base and processing volumes outside the U.S., and increasing revenues from debit card processing and other new products. The company also aims to enhance its check risk management services by developing sophisticated risk modeling tools and expanding into new markets.

Yes, Certegy began returning capital to shareholders in 2003 by declaring its first quarterly dividend of $0.05 per share. Additionally, the company continued its share repurchase program, buying back $73.6 million of its common stock.