10-KPeriod: FY2014

Fidelity National Information Services, Inc. Annual Report, Year Ended Dec 31, 2014

Filed February 27, 2015For Securities:FIS

Summary

Fidelity National Information Services (FIS) reported robust revenue growth in 2014, reaching $6.41 billion, a 5.8% increase year-over-year, driven by strong performance in consulting and professional services, particularly within its Financial Solutions Group (FSG) and International Solutions Group (ISG), alongside contributions from recent acquisitions. The company continues to benefit from the industry trend of financial institutions outsourcing technology and processing needs, which provides a stable, recurring revenue stream. Operating income saw a significant increase to $1.27 billion, reflecting improved operational efficiencies and revenue growth, although the operating margin slightly decreased due to a shift towards lower-margin consulting services. FIS also demonstrated a commitment to shareholder returns through consistent dividend payments and significant share repurchases, with approximately $1.52 billion remaining under its authorization as of year-end 2014.

Financial Highlights

56 data points
Beta

Revenue

$6.41B

32.5% Gross Margin

Net Income

$679.00M

10.6% Net Margin

EPS (Diluted)

$2.35

Total Assets

$14.52B

Cash & Equivalents

$493.00M

Free Cash Flow

$1.02B

Financial Statements
Beta
Revenue$6.41B
Gross Profit$2.09B
SG&A Expenses$815.00M
Operating Expenses$5.14B
Operating Income$1.27B
Interest Expense$173.00M
Net Income$679.00M
EPS (Basic)$2.38
EPS (Diluted)$2.35
Shares Outstanding (Basic)285.00M
Shares Outstanding (Diluted)289.00M

Key Highlights

  • 1Revenue grew 5.8% to $6.41 billion in 2014, driven by consulting, professional services, and acquisitions.
  • 2Operating income increased by 19.5% to $1.27 billion, showcasing improved profitability.
  • 3The company operates through four segments: Financial Solutions Group (FSG), Payment Solutions Group (PSG), International Solutions Group (ISG), and Corporate and Other.
  • 4FIS continues to benefit from the trend of financial institutions outsourcing technology and processing, providing stable recurring revenue.
  • 5Shareholder returns were supported by consistent dividend payments and active share repurchases.
  • 6The company made several strategic acquisitions in 2014, including Clear2Pay and Reliance Financial Corporation, to expand its service offerings.
  • 7Despite a strong revenue performance, the operating margin saw a slight decrease due to a growing proportion of lower-margin consulting services.

Frequently Asked Questions

Revenue growth in 2014 was primarily driven by increased demand for consulting and professional services, incremental revenues from acquisitions made in 2013 and 2014 (such as Reliance), and growth in international operations, particularly in Europe and Asia.

FIS actively managed its debt through refinancing activities in 2013 and 2014, which led to lower borrowing rates and a decrease in interest expense. The company also maintained a significant share repurchase program, indicating a focus on returning capital to shareholders.

FIS' strategy involves both organic growth through internal product development and market expansion, and strategic acquisitions to complement or enhance existing offerings and diversify revenues. The company continues to invest in innovation and cross-selling opportunities.

Key risks include intense competition, the potential for consolidation in the financial services industry to reduce the client base, the need to adapt to technological changes and innovate services, global economic conditions affecting client spending, and cybersecurity threats.