x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the quarterly period ended June 30, 2013 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the transition period from to |
Georgia | 37-1490331 | |
(State or other jurisdiction | (I.R.S. Employer Identification No.) | |
of incorporation or organization) | ||
601 Riverside Avenue | ||
Jacksonville, Florida | 32204 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer x | Accelerated filer o | Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company o |
Page | |
EX-31.1 | |
EX-31.2 | |
EX-32.1 | |
EX-32.2 | |
EX-101 INSTANCE DOCUMENT | |
EX-101 SCHEMA DOCUMENT | |
EX-101 CALCULATION LINKBASE DOCUMENT | |
EX-101 DEFINITION LINKBASE DOCUMENT | |
EX-101 LABELS LINKBASE DOCUMENT | |
EX-101 PRESENTATION LINKBASE DOCUMENT |
June 30, 2013 | December 31, 2012 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 653.1 | $ | 517.6 | |||
Settlement deposits | 28.0 | 32.6 | |||||
Trade receivables, net of allowance for doubtful accounts of $21.3 and $19.9 as of June 30, 2013 and December 31, 2012, respectively | 948.5 | 925.7 | |||||
Settlement receivables | 85.6 | 128.3 | |||||
Other receivables | 58.2 | 30.2 | |||||
Due from Brazilian venture partner | 38.1 | 42.0 | |||||
Prepaid expenses and other current assets | 181.2 | 111.9 | |||||
Deferred income taxes | 58.6 | 55.9 | |||||
Total current assets | 2,051.3 | 1,844.2 | |||||
Property and equipment, net | 415.8 | 419.5 | |||||
Goodwill | 8,487.4 | 8,381.5 | |||||
Intangible assets, net | 1,466.2 | 1,576.2 | |||||
Computer software, net | 848.4 | 847.0 | |||||
Deferred contract costs, net | 213.2 | 211.2 | |||||
Other noncurrent assets | 267.8 | 270.1 | |||||
Total assets | $ | 13,750.1 | $ | 13,549.7 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable and accrued liabilities | $ | 657.1 | $ | 624.6 | |||
Due to Brazilian venture partner | 14.3 | 18.8 | |||||
Settlement payables | 121.1 | 172.2 | |||||
Current portion of long-term debt | 83.7 | 153.9 | |||||
Deferred revenues | 266.7 | 287.3 | |||||
Total current liabilities | 1,142.9 | 1,256.8 | |||||
Deferred revenues | 35.6 | 42.2 | |||||
Deferred income taxes | 801.2 | 821.8 | |||||
Long-term debt, excluding current portion | 4,672.7 | 4,231.6 | |||||
Due to Brazilian venture partner | 34.5 | 40.5 | |||||
Other long-term liabilities | 313.0 | 363.2 | |||||
Total liabilities | 6,999.9 | 6,756.1 | |||||
Equity: | |||||||
FIS stockholders’ equity: | |||||||
Preferred stock, $0.01 par value, 200 shares authorized, none issued and outstanding as of June 30, 2013 and December 31, 2012 | — | — | |||||
Common stock, $0.01 par value, 600 shares authorized, 386.1 and 385.9 shares issued as of June 30, 2013 and December 31, 2012, respectively | 3.8 | 3.8 | |||||
Additional paid in capital | 7,207.1 | 7,197.0 | |||||
Retained earnings | 2,226.1 | 2,105.8 | |||||
Accumulated other comprehensive earnings | (10.3 | ) | 30.0 | ||||
Treasury stock, $0.01 par value, 94.0 and 91.8 shares as of June 30, 2013 and December 31, 2012, respectively, at cost | (2,828.1 | ) | (2,695.7 | ) | |||
Total FIS stockholders’ equity | 6,598.6 | 6,640.9 | |||||
Noncontrolling interest | 151.6 | 152.7 | |||||
Total equity | 6,750.2 | 6,793.6 | |||||
Total liabilities and equity | $ | 13,750.1 | $ | 13,549.7 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Processing and services revenues (for related party activity, see note 2) | $ | 1,512.5 | $ | 1,457.2 | $ | 2,990.5 | $ | 2,870.6 | |||||||
Cost of revenues | 1,028.2 | 981.1 | 2,036.2 | 1,970.6 | |||||||||||
Gross profit | 484.3 | 476.1 | 954.3 | 900.0 | |||||||||||
Selling, general, and administrative expenses (for related party activity, see note 2) | 236.7 | 193.4 | 431.6 | 394.8 | |||||||||||
Operating income | 247.6 | 282.7 | 522.7 | 505.2 | |||||||||||
Other income (expense): | |||||||||||||||
Interest expense, net | (49.4 | ) | (56.6 | ) | (101.1 | ) | (116.0 | ) | |||||||
Other income (expense), net | (61.9 | ) | (1.8 | ) | (56.8 | ) | (22.7 | ) | |||||||
Total other income (expense), net | (111.3 | ) | (58.4 | ) | (157.9 | ) | (138.7 | ) | |||||||
Earnings from continuing operations before income taxes | 136.3 | 224.3 | 364.8 | 366.5 | |||||||||||
Provision for income taxes | 40.9 | 65.3 | 116.1 | 113.0 | |||||||||||
Earnings from continuing operations, net of tax | 95.4 | 159.0 | 248.7 | 253.5 | |||||||||||
Earnings (loss) from discontinued operations, net of tax | 13.6 | (5.2 | ) | 9.7 | (9.6 | ) | |||||||||
Net earnings | 109.0 | 153.8 | 258.4 | 243.9 | |||||||||||
Net (earnings) loss attributable to noncontrolling interest | (4.2 | ) | (3.2 | ) | (9.5 | ) | (6.2 | ) | |||||||
Net earnings attributable to FIS | $ | 104.8 | $ | 150.6 | $ | 248.9 | $ | 237.7 | |||||||
Net earnings per share — basic from continuing operations attributable to FIS common stockholders | $ | 0.31 | $ | 0.53 | $ | 0.82 | $ | 0.85 | |||||||
Net earnings (loss) per share — basic from discontinued operations attributable to FIS common stockholders | 0.05 | (0.02 | ) | 0.03 | (0.03 | ) | |||||||||
Net earnings per share — basic attributable to FIS common stockholders * | $ | 0.36 | $ | 0.51 | $ | 0.86 | $ | 0.82 | |||||||
Weighted average shares outstanding — basic | 289.9 | 292.7 | 290.5 | 291.2 | |||||||||||
Net earnings per share — diluted from continuing operations attributable to FIS common stockholders | $ | 0.31 | $ | 0.52 | $ | 0.81 | $ | 0.83 | |||||||
Net earnings (loss) per share — diluted from discontinued operations attributable to FIS common stockholders | 0.05 | (0.02 | ) | 0.03 | (0.03 | ) | |||||||||
Net earnings per share — diluted attributable to FIS common stockholders * | $ | 0.36 | $ | 0.50 | $ | 0.84 | $ | 0.80 | |||||||
Weighted average shares outstanding — diluted | 294.3 | 298.3 | 294.8 | 296.8 | |||||||||||
Cash dividends paid per share | $ | 0.22 | $ | 0.20 | $ | 0.44 | $ | 0.40 | |||||||
Amounts attributable to FIS common stockholders: | |||||||||||||||
Earnings from continuing operations, net of tax | $ | 91.2 | $ | 155.8 | $ | 239.2 | $ | 247.3 | |||||||
Earnings (loss) from discontinued operations, net of tax | 13.6 | (5.2 | ) | 9.7 | (9.6 | ) | |||||||||
Net earnings attributable to FIS | $ | 104.8 | $ | 150.6 | $ | 248.9 | $ | 237.7 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||||||
Net earnings | $ | 109.0 | $ | 153.8 | $ | 258.4 | $ | 243.9 | |||||||||||||||||||||||
Other comprehensive earnings, before tax: | |||||||||||||||||||||||||||||||
Unrealized gain (loss) on investments and derivatives | $ | 2.3 | $ | (7.6 | ) | $ | 1.1 | $ | (1.9 | ) | |||||||||||||||||||||
Reclassification adjustment for losses included in net earnings | 1.3 | 1.5 | 3.0 | 4.1 | |||||||||||||||||||||||||||
Unrealized gain (loss) on investments and derivatives, net | 3.6 | (6.1 | ) | 4.1 | 2.2 | ||||||||||||||||||||||||||
Foreign currency translation adjustments | (46.5 | ) | (52.0 | ) | (53.7 | ) | (27.6 | ) | |||||||||||||||||||||||
Other comprehensive earnings (loss), before tax | (42.9 | ) | (58.1 | ) | (49.6 | ) | (25.4 | ) | |||||||||||||||||||||||
Provision for income tax expense (benefit) related to items of other comprehensive earnings | (1.0 | ) | (4.2 | ) | (0.2 | ) | (0.4 | ) | |||||||||||||||||||||||
Other comprehensive earnings (loss), net of tax | $ | (41.9 | ) | (41.9 | ) | $ | (53.9 | ) | (53.9 | ) | $ | (49.4 | ) | (49.4 | ) | $ | (25.0 | ) | (25.0 | ) | |||||||||||
Comprehensive earnings | 67.1 | 99.9 | 209.0 | 218.9 | |||||||||||||||||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (4.2 | ) | (3.2 | ) | (9.5 | ) | (6.2 | ) | |||||||||||||||||||||||
Other comprehensive (earnings) losses attributable to noncontrolling interest | 10.6 | 11.0 | 9.1 | 8.8 | |||||||||||||||||||||||||||
Comprehensive earnings attributable to FIS | $ | 73.5 | $ | 107.7 | $ | 208.6 | $ | 221.5 |
Amount | |||||||||||||||||||||||||||||||||
FIS Stockholders | |||||||||||||||||||||||||||||||||
Accumulated | |||||||||||||||||||||||||||||||||
Number of shares | Additional | other | |||||||||||||||||||||||||||||||
Common | Treasury | Common | paid in | Retained | comprehensive | Treasury | Noncontrolling | Total | |||||||||||||||||||||||||
shares | shares | stock | capital | earnings | earnings | stock | interest | equity | |||||||||||||||||||||||||
Balances, December 31, 2012 | 385.9 | (91.8 | ) | $ | 3.8 | $ | 7,197.0 | $ | 2,105.8 | $ | 30.0 | $ | (2,695.7 | ) | $ | 152.7 | $ | 6,793.6 | |||||||||||||||
Issuance of restricted stock | 0.2 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Exercise of stock options and stock purchase right | — | 3.4 | — | (33.9 | ) | — | — | 98.4 | — | 64.5 | |||||||||||||||||||||||
Treasury shares held for taxes due upon exercise of stock options | — | (0.1 | ) | — | — | — | — | (5.5 | ) | — | (5.5 | ) | |||||||||||||||||||||
Excess income tax benefit from exercise of stock options | — | — | — | 14.5 | — | — | — | — | 14.5 | ||||||||||||||||||||||||
Stock-based compensation | — | — | — | 29.5 | — | — | — | — | 29.5 | ||||||||||||||||||||||||
Cash dividends paid ($0.22 per share per quarter) and other distributions | — | — | — | — | (128.6 | ) | — | — | (1.5 | ) | (130.1 | ) | |||||||||||||||||||||
Purchases of treasury stock | — | (5.5 | ) | — | — | — | — | (225.3 | ) | — | (225.3 | ) | |||||||||||||||||||||
Net earnings | — | — | — | — | 248.9 | — | — | 9.5 | 258.4 | ||||||||||||||||||||||||
Other comprehensive earnings | — | — | — | — | — | (40.3 | ) | — | (9.1 | ) | (49.4 | ) | |||||||||||||||||||||
Balances, June 30, 2013 | 386.1 | (94.0 | ) | $ | 3.8 | $ | 7,207.1 | $ | 2,226.1 | $ | (10.3 | ) | $ | (2,828.1 | ) | $ | 151.6 | $ | 6,750.2 |
Six months ended June 30, | |||||||
2013 | 2012 | ||||||
Cash flows from operating activities: | |||||||
Net earnings | $ | 258.4 | $ | 243.9 | |||
Adjustment to reconcile net earnings to net cash provided by operating activities: | |||||||
Depreciation and amortization | 305.5 | 317.2 | |||||
Amortization of debt issue costs | 14.6 | 24.6 | |||||
ClearPar contingent consideration included in discontinued operations | (26.8 | ) | — | ||||
Gain on mFoundry acquisition | (9.2 | ) | — | ||||
Stock-based compensation | 26.4 | 42.9 | |||||
Deferred income taxes | (24.7 | ) | 5.8 | ||||
Excess income tax benefit from exercise of stock options | (14.5 | ) | (10.3 | ) | |||
Other operating activities | 1.7 | — | |||||
Net changes in assets and liabilities, net of effects from acquisitions and foreign currency: | |||||||
Trade receivables | (26.1 | ) | (55.6 | ) | |||
Settlement activity | (3.6 | ) | (7.5 | ) | |||
Prepaid expenses and other assets | (60.7 | ) | (16.7 | ) | |||
Deferred contract costs | (37.3 | ) | (34.9 | ) | |||
Deferred revenue | (26.0 | ) | (21.0 | ) | |||
Accounts payable, accrued liabilities, and other liabilities | (12.9 | ) | (25.7 | ) | |||
Net cash provided by operating activities | 364.8 | 462.7 | |||||
Cash flows from investing activities: | |||||||
Additions to property and equipment | (59.5 | ) | (66.6 | ) | |||
Additions to computer software | (97.5 | ) | (89.1 | ) | |||
Receipt of contingent consideration from ClearPar sale | 26.8 | — | |||||
Acquisitions, net of cash acquired, and equity investments | (130.1 | ) | (41.7 | ) | |||
Other investing activities, net | (22.8 | ) | — | ||||
Net cash used in investing activities | (283.1 | ) | (197.4 | ) | |||
Cash flows from financing activities: | |||||||
Borrowings | 7,151.6 | 7,483.3 | |||||
Repayment of borrowings | (6,776.0 | ) | (7,430.8 | ) | |||
Debt issuance costs | (17.0 | ) | (47.5 | ) | |||
Excess income tax benefit from exercise of stock options | 14.5 | 10.3 | |||||
Proceeds from exercise of stock options | 72.9 | 152.9 | |||||
Treasury stock activity | (230.8 | ) | (186.0 | ) | |||
Dividends paid | (127.9 | ) | (117.7 | ) | |||
Other financing activities, net | (11.8 | ) | (4.7 | ) | |||
Net cash provided by (used in) financing activities | 75.5 | (140.2 | ) | ||||
Effect of foreign currency exchange rate changes on cash | (21.7 | ) | (6.8 | ) | |||
Net increase in cash and cash equivalents | 135.5 | 118.3 | |||||
Cash and cash equivalents, beginning of period | 517.6 | 415.5 | |||||
Cash and cash equivalents, end of period | $ | 653.1 | $ | 533.8 | |||
Supplemental cash flow information: | |||||||
Cash paid for interest | $ | 112.9 | $ | 97.8 | |||
Cash paid for income taxes | $ | 186.7 | $ | 87.3 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Banco Bradesco Brazilian Venture revenue | $ | 78.5 | $ | 67.2 | $ | 153.8 | $ | 142.6 | |||||||
FNF data processing services revenue | — | 8.5 | — | 20.5 | |||||||||||
Ceridian data processing and services revenue | — | 28.1 | — | 46.7 | |||||||||||
Total related party revenues | $ | 78.5 | $ | 103.8 | $ | 153.8 | $ | 209.8 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Earnings from continuing operations attributable to FIS, net of tax | $ | 91.2 | $ | 155.8 | $ | 239.2 | $ | 247.3 | |||||||
Earnings (loss) from discontinued operations attributable to FIS, net of tax | 13.6 | (5.2 | ) | 9.7 | (9.6 | ) | |||||||||
Net earnings attributable to FIS common stockholders | $ | 104.8 | $ | 150.6 | $ | 248.9 | $ | 237.7 | |||||||
Weighted average shares outstanding — basic | 289.9 | 292.7 | 290.5 | 291.2 | |||||||||||
Plus: Common stock equivalent shares | 4.4 | 5.6 | 4.3 | 5.6 | |||||||||||
Weighted average shares outstanding — diluted | 294.3 | 298.3 | 294.8 | 296.8 | |||||||||||
Net earnings per share — basic from continuing operations attributable to FIS common stockholders | $ | 0.31 | $ | 0.53 | $ | 0.82 | $ | 0.85 | |||||||
Net earnings (loss) per share — basic from discontinued operations attributable to FIS common stockholders | 0.05 | (0.02 | ) | 0.03 | (0.03 | ) | |||||||||
Net earnings per share — basic attributable to FIS common stockholders * | $ | 0.36 | $ | 0.51 | $ | 0.86 | $ | 0.82 | |||||||
Net earnings per share — diluted from continuing operations attributable to FIS common stockholders | $ | 0.31 | $ | 0.52 | $ | 0.81 | $ | 0.83 | |||||||
Net earnings (loss) per share — diluted from discontinued operations attributable to FIS common stockholders | 0.05 | (0.02 | ) | 0.03 | (0.03 | ) | |||||||||
Net earnings per share — diluted attributable to FIS common stockholders * | $ | 0.36 | $ | 0.50 | $ | 0.84 | $ | 0.80 | |||||||
* Amounts may not sum due to rounding. |
Foreign | ||||||||||||||||
Interest Rate | Currency | |||||||||||||||
Swap | Translation | |||||||||||||||
Contracts | Adjustments | Other | Total | |||||||||||||
Balances, December 31, 2012 | $ | (6.1 | ) | $ | 36.3 | $ | (0.2 | ) | $ | 30.0 | ||||||
Other comprehensive gain/(loss) before reclassifications | 2.9 | (42.5 | ) | (2.5 | ) | (42.1 | ) | |||||||||
Amounts reclassified from AOCE | 1.8 | — | — | 1.8 | ||||||||||||
Net current period AOCE attributable to FIS | 4.7 | (42.5 | ) | (2.5 | ) | (40.3 | ) | |||||||||
Balances, June 30, 2013 | $ | (1.4 | ) | $ | (6.2 | ) | $ | (2.7 | ) | $ | (10.3 | ) |
June 30, 2013 | December 31, 2012 | ||||||||||||||||||||||
Cost | Accumulated depreciation and amortization | Net | Cost | Accumulated depreciation and amortization | Net | ||||||||||||||||||
Property and equipment | $ | 1,016.0 | $ | 600.2 | $ | 415.8 | $ | 975.5 | $ | 556.0 | $ | 419.5 | |||||||||||
Intangible assets | $ | 2,803.9 | $ | 1,337.7 | $ | 1,466.2 | $ | 2,962.6 | $ | 1,386.4 | $ | 1,576.2 | |||||||||||
Computer software | $ | 1,511.0 | $ | 662.6 | $ | 848.4 | $ | 1,451.6 | $ | 604.6 | $ | 847.0 |
June 30, 2013 | December 31, 2012 | ||||||
Term Loans A-2 (1) | $ | — | $ | 250.0 | |||
Term Loans A-3, quarterly principal amortization (2) | — | 2,021.3 | |||||
Term Loans A-4, quarterly principal amortization (3) | 1,987.5 | — | |||||
Senior Notes due 2017, interest payable semi-annually at 7.625% | — | 750.0 | |||||
Senior Notes due 2018, interest payable semi-annually at 2.000% | 250.0 | — | |||||
Senior Notes due 2020, interest payable semi-annually at 7.875% | 500.0 | 500.0 | |||||
Senior Notes due 2022, interest payable semi-annually at 5.000% | 700.0 | 700.0 | |||||
Senior Notes due 2023, interest payable semi-annually at 3.500% | 1,000.0 | — | |||||
Revolving Loan (4) | 300.0 | 126.3 | |||||
Other | 18.9 | 37.9 | |||||
4,756.4 | 4,385.5 | ||||||
Current portion | (83.7 | ) | (153.9 | ) | |||
Long-term debt, excluding current portion | $ | 4,672.7 | $ | 4,231.6 |
(1) | The Term Loans A-2 were repaid in full on January 11, 2013 through additional borrowings on our Revolving Loan. |
(2) | The Term Loans A-3 were repaid in full on April 23, 2013 and replaced with Term Loans A-4 as discussed below. |
(3) | Interest on the Term Loans A-4 is generally payable at LIBOR plus an applicable margin of up to 2.00% based upon the Company's corporate credit ratings and the ratings on the FIS Credit Agreement. As of June 30, 2013, the weighted average interest rate on the Term Loans A-4 was 1.69%. |
(4) | Interest on the Revolving Loan is generally payable at LIBOR plus an applicable margin of up to 2.00% plus an unused commitment fee of up to 0.35%, each based upon the Company's corporate credit ratings and the ratings on the FIS Credit Agreement. As of June 30, 2013, the applicable margin on the Revolving Loan, excluding facility fees and unused commitment fees, was 1.50%. |
Term Loan | 2018 | 2020 | 2022 | 2023 | |||||||||||||||||||
A-4 | Notes | Notes | Notes | Notes | Total | ||||||||||||||||||
2013 | $ | 25.0 | $ | — | $ | — | $ | — | $ | — | $ | 25.0 | |||||||||||
2014 | 100.0 | — | — | — | — | 100.0 | |||||||||||||||||
2015 | 100.0 | — | — | — | — | 100.0 | |||||||||||||||||
2016 | 100.0 | — | — | — | — | 100.0 | |||||||||||||||||
2017 | 1,662.5 | — | — | — | — | 1,662.5 | |||||||||||||||||
Thereafter | — | 250.0 | 500.0 | 700.0 | 1,000.0 | 2,450.0 | |||||||||||||||||
Total | $ | 1,987.5 | $ | 250.0 | $ | 500.0 | $ | 700.0 | $ | 1,000.0 | $ | 4,437.5 |
Effective date | Termination date | Notional amount | Bank pays variable rate of | FIS pays fixed rate of | ||||||||
September 1, 2011 | September 1, 2014 | $ | 150.0 | 1 Month LIBOR (1) | 0.74 | % | (2) | |||||
September 1, 2011 | September 1, 2014 | 150.0 | 1 Month LIBOR (1) | 0.74 | % | (2) | ||||||
September 1, 2011 | September 1, 2014 | 300.0 | 1 Month LIBOR (1) | 0.72 | % | (2) | ||||||
July 1, 2012 | July 1, 2015 | 300.0 | 1 Month LIBOR (1) | 0.58 | % | (2) | ||||||
February 1, 2013 | February 3, 2014 | 200.0 | 1 Month LIBOR (1) | 0.28 | % | (2) | ||||||
February 1, 2013 | February 3, 2014 | 200.0 | 1 Month LIBOR (1) | 0.28 | % | (2) | ||||||
February 3, 2014 | February 1, 2017 | 400.0 | 1 Month LIBOR (1) | 0.89 | % | (2) | ||||||
$ | 1,700.0 |
(1) | 0.19% in effect as of June 30, 2013. |
(2) | Does not include the applicable margin and facility fees paid to lenders on the Term Loans and Revolving Loan as described above. |
June 30, 2013 | December 31, 2012 | ||||||||||
Balance sheet location | Fair value | Balance sheet location | Fair value | ||||||||
Interest rate swap contracts | Other noncurrent assets | $ | 2.1 | Other noncurrent assets | $ | — | |||||
Interest rate swap contracts | Accounts payable and accrued liabilities | 0.2 | Accounts payable and accrued liabilities | 1.0 | |||||||
Interest rate swap contracts | Other long-term liabilities | 4.5 | Other long-term liabilities | 9.4 |
Amount of gain (loss) recognized in AOCE on derivatives | Amount of loss reclassified from AOCE into income | |||||||||||||||||
Derivatives in cash | Three months ended | Location of loss | Three months ended | |||||||||||||||
flow hedging | June 30, | reclassified from | June 30, | |||||||||||||||
relationships | 2013 | 2012 | AOCE into income | 2013 | 2012 | |||||||||||||
Interest rate swap contracts | $ | 4.8 | $ | (2.8 | ) | Interest expense | $ | (1.3 | ) | $ | (1.5 | ) |
Amount of gain (loss)recognized in AOCE on derivatives | Amount of loss reclassified from AOCE into income | |||||||||||||||||
Derivatives in cash | Six months ended | Location of loss | Six months ended | |||||||||||||||
flow hedging | June 30, | reclassified from | June 30, | |||||||||||||||
relationships | 2013 | 2012 | AOCE into income | 2013 | 2012 | |||||||||||||
Interest rate swap contracts | $ | 4.8 | $ | (4.6 | ) | Interest expense | $ | (3.0 | ) | $ | (4.1 | ) |
Condensed Consolidating Balance Sheets | |||||||||||||||||||
June 30, 2013 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Assets | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 12.9 | $ | 206.9 | $ | 433.3 | $ | — | $ | 653.1 | |||||||||
Settlement deposits | — | 28.0 | — | — | 28.0 | ||||||||||||||
Trade receivables, net | — | 692.8 | 255.7 | — | 948.5 | ||||||||||||||
Investment in subsidiaries, intercompany and receivables from related parties | 9,548.7 | 10,052.0 | 1,028.0 | (20,590.6 | ) | 38.1 | |||||||||||||
Other current assets | 64.5 | 244.3 | 74.8 | — | 383.6 | ||||||||||||||
Total current assets | 9,626.1 | 11,224.0 | 1,791.8 | (20,590.6 | ) | 2,051.3 | |||||||||||||
Property and equipment, net | 7.6 | 320.8 | 87.4 | — | 415.8 | ||||||||||||||
Goodwill | — | 7,205.5 | 1,281.9 | — | 8,487.4 | ||||||||||||||
Intangible assets, net | — | 1,091.5 | 374.7 | — | 1,466.2 | ||||||||||||||
Computer software, net | 38.4 | 646.7 | 163.3 | — | 848.4 | ||||||||||||||
Other noncurrent assets | 73.3 | 329.7 | 78.0 | — | 481.0 | ||||||||||||||
Total assets | $ | 9,745.4 | $ | 20,818.2 | $ | 3,777.1 | $ | (20,590.6 | ) | $ | 13,750.1 | ||||||||
Liabilities and Equity | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Accounts payable and accrued liabilities | $ | 146.0 | $ | 225.9 | $ | 285.2 | $ | — | $ | 657.1 | |||||||||
Settlement payables | — | 112.3 | 8.8 | — | 121.1 | ||||||||||||||
Current portion of long-term debt | 75.0 | 6.8 | 1.9 | — | 83.7 | ||||||||||||||
Deferred revenues | — | 188.4 | 78.3 | — | 266.7 | ||||||||||||||
Other current liabilites | — | — | 14.3 | — | 14.3 | ||||||||||||||
Total current liabilities | 221.0 | 533.4 | 388.5 | — | 1,142.9 | ||||||||||||||
Deferred income taxes | — | 784.9 | 16.3 | — | 801.2 | ||||||||||||||
Long-term debt, excluding current portion | 4,667.9 | 4.2 | 0.6 | — | 4,672.7 | ||||||||||||||
Other long-term liabilities | 6.3 | 89.7 | 287.1 | — | 383.1 | ||||||||||||||
Total liabilities | 4,895.2 | 1,412.2 | 692.5 | — | 6,999.9 | ||||||||||||||
Total equity | 4,850.2 | 19,406.0 | 3,084.6 | (20,590.6 | ) | 6,750.2 | |||||||||||||
Total liabilities and equity | $ | 9,745.4 | $ | 20,818.2 | $ | 3,777.1 | $ | (20,590.6 | ) | $ | 13,750.1 |
Condensed Consolidating Balance Sheets | |||||||||||||||||||
December 31, 2012 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Assets | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 18.4 | $ | 226.8 | $ | 272.4 | $ | — | $ | 517.6 | |||||||||
Settlement deposits | — | 32.6 | — | — | 32.6 | ||||||||||||||
Trade receivables, net | — | 693.9 | 231.8 | — | 925.7 | ||||||||||||||
Investment in subsidiaries, intercompany and receivables from related parties | 9,207.5 | 9,482.0 | 1,087.8 | (19,735.3 | ) | 42.0 | |||||||||||||
Other current assets | 21.2 | 259.6 | 45.5 | — | 326.3 | ||||||||||||||
Total current assets | 9,247.1 | 10,694.9 | 1,637.5 | (19,735.3 | ) | 1,844.2 | |||||||||||||
Property and equipment, net | 12.0 | 328.8 | 78.7 | — | 419.5 | ||||||||||||||
Goodwill | — | 7,205.7 | 1,175.8 | — | 8,381.5 | ||||||||||||||
Intangible assets, net | — | 1,191.4 | 384.8 | — | 1,576.2 | ||||||||||||||
Computer software, net | 39.7 | 641.9 | 165.4 | — | 847.0 | ||||||||||||||
Other noncurrent assets | 103.2 | 288.3 | 89.8 | — | 481.3 | ||||||||||||||
Total assets | $ | 9,402.0 | $ | 20,351.0 | $ | 3,532.0 | $ | (19,735.3 | ) | $ | 13,549.7 | ||||||||
Liabilities and Equity | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Accounts payable and accrued liabilities | $ | 110.7 | $ | 257.1 | $ | 256.8 | $ | — | $ | 624.6 | |||||||||
Settlement payables | — | 165.6 | 6.6 | — | 172.2 | ||||||||||||||
Current portion of long-term debt | 144.4 | 7.4 | 2.1 | — | 153.9 | ||||||||||||||
Deferred revenues | — | 224.0 | 63.3 | — | 287.3 | ||||||||||||||
Other current liabilites | — | — | 18.8 | — | 18.8 | ||||||||||||||
Total current liabilities | 255.1 | 654.1 | 347.6 | — | 1,256.8 | ||||||||||||||
Deferred income taxes | — | 820.4 | 1.4 | — | 821.8 | ||||||||||||||
Long-term debt, excluding current portion | 4,224.1 | 7.2 | 0.3 | — | 4,231.6 | ||||||||||||||
Other long-term liabilities | 29.0 | 99.7 | 317.2 | — | 445.9 | ||||||||||||||
Total liabilities | 4,508.2 | 1,581.4 | 666.5 | — | 6,756.1 | ||||||||||||||
Total equity | 4,893.8 | 18,769.6 | 2,865.5 | (19,735.3 | ) | 6,793.6 | |||||||||||||
Total liabilities and equity | $ | 9,402.0 | $ | 20,351.0 | $ | 3,532.0 | $ | (19,735.3 | ) | $ | 13,549.7 |
Condensed Consolidating Statements of Earnings and Comprehensive Earnings | |||||||||||||||||||
Three months ended June 30, 2013 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Processing and services revenues | $ | — | $ | 1,180.8 | $ | 331.7 | $ | — | $ | 1,512.5 | |||||||||
Operating expenses | 56.6 | 876.0 | 332.3 | — | 1,264.9 | ||||||||||||||
Operating income | (56.6 | ) | 304.8 | (0.6 | ) | — | 247.6 | ||||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense, net | (48.1 | ) | (0.4 | ) | (0.9 | ) | — | (49.4 | ) | ||||||||||
Other income (expense) | (63.8 | ) | 3.1 | (1.2 | ) | — | (61.9 | ) | |||||||||||
Net earnings (loss) of equity affiliates | 212.9 | — | — | (212.9 | ) | — | |||||||||||||
Total other income (expense) | 101.0 | 2.7 | (2.1 | ) | (212.9 | ) | (111.3 | ) | |||||||||||
Earnings (loss) from continuing operations before income taxes | 44.4 | 307.5 | (2.7 | ) | (212.9 | ) | 136.3 | ||||||||||||
Provision for income taxes | (51.0 | ) | 92.9 | (1.0 | ) | — | 40.9 | ||||||||||||
Net earnings (loss) from continuing operations | 95.4 | 214.6 | (1.7 | ) | (212.9 | ) | 95.4 | ||||||||||||
Earnings (loss) from discontinued operations, net of tax | 13.6 | — | (3.1 | ) | 3.1 | 13.6 | |||||||||||||
Net earnings (loss) | 109.0 | 214.6 | (4.8 | ) | (209.8 | ) | 109.0 | ||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (4.2 | ) | 0.1 | (4.3 | ) | 4.2 | (4.2 | ) | |||||||||||
Net earnings (loss) attributable to FIS common stockholders | $ | 104.8 | $ | 214.7 | $ | (9.1 | ) | $ | (205.6 | ) | $ | 104.8 | |||||||
Comprehensive earnings (loss) attributable to FIS | $ | 73.5 | $ | 216.1 | $ | (44.6 | ) | $ | (171.5 | ) | $ | 73.5 |
Condensed Consolidating Statements of Earnings and Comprehensive Earnings | |||||||||||||||||||
Three months ended June 30, 2012 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Processing and services revenues | $ | — | $ | 1,145.5 | $ | 311.7 | $ | — | $ | 1,457.2 | |||||||||
Operating expenses | 39.1 | 858.4 | 277.0 | — | 1,174.5 | ||||||||||||||
Operating income | (39.1 | ) | 287.1 | 34.7 | — | 282.7 | |||||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense, net | (55.2 | ) | (0.5 | ) | (0.9 | ) | — | (56.6 | ) | ||||||||||
Other income (expense) | (1.3 | ) | 2.9 | (3.4 | ) | — | (1.8 | ) | |||||||||||
Net earnings (loss) of equity affiliates | 227.7 | — | — | (227.7 | ) | — | |||||||||||||
Total other income (expense) | 171.2 | 2.4 | (4.3 | ) | (227.7 | ) | (58.4 | ) | |||||||||||
Earnings (loss) from continuing operations before income taxes | 132.1 | 289.5 | 30.4 | (227.7 | ) | 224.3 | |||||||||||||
Provision for income taxes | (26.9 | ) | 81.5 | 10.7 | — | 65.3 | |||||||||||||
Net earnings (loss) from continuing operations | 159.0 | 208.0 | 19.7 | (227.7 | ) | 159.0 | |||||||||||||
Earnings (loss) from discontinued operations, net of tax | (5.2 | ) | 4.2 | (9.4 | ) | 5.2 | (5.2 | ) | |||||||||||
Net earnings (loss) | 153.8 | 212.2 | 10.3 | (222.5 | ) | 153.8 | |||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (3.2 | ) | — | (3.2 | ) | 3.2 | (3.2 | ) | |||||||||||
Net earnings (loss) attributable to FIS common stockholders | $ | 150.6 | $ | 212.2 | $ | 7.1 | $ | (219.3 | ) | $ | 150.6 | ||||||||
Comprehensive earnings (loss) attributable to FIS | $ | 107.7 | $ | 212.1 | $ | (27.4 | ) | $ | (184.7 | ) | $ | 107.7 |
Condensed Consolidating Statements of Earnings and Comprehensive Earnings | |||||||||||||||||||
Six months ended June 30, 2013 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Processing and services revenues | $ | — | $ | 2,340.2 | $ | 650.3 | $ | — | $ | 2,990.5 | |||||||||
Operating expenses | 118.1 | 1,742.4 | 607.3 | — | 2,467.8 | ||||||||||||||
Operating income | (118.1 | ) | 597.8 | 43.0 | — | 522.7 | |||||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense, net | (98.3 | ) | (0.8 | ) | (2.0 | ) | — | (101.1 | ) | ||||||||||
Other income (expense) | (54.2 | ) | 3.2 | (5.8 | ) | — | (56.8 | ) | |||||||||||
Net earnings (loss) of equity affiliates | 435.2 | — | — | (435.2 | ) | — | |||||||||||||
Total other income (expense) | 282.7 | 2.4 | (7.8 | ) | (435.2 | ) | (157.9 | ) | |||||||||||
Earnings (loss) from continuing operations before income taxes | 164.6 | 600.2 | 35.2 | (435.2 | ) | 364.8 | |||||||||||||
Provision for income taxes | (84.1 | ) | 187.8 | 12.4 | — | 116.1 | |||||||||||||
Net earnings (loss) from continuing operations | 248.7 | 412.4 | 22.8 | (435.2 | ) | 248.7 | |||||||||||||
Earnings (loss) from discontinued operations, net of tax | 9.7 | 0.1 | (7.1 | ) | 7.0 | 9.7 | |||||||||||||
Net earnings (loss) | 258.4 | 412.5 | 15.7 | (428.2 | ) | 258.4 | |||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (9.5 | ) | 0.3 | (9.8 | ) | 9.5 | (9.5 | ) | |||||||||||
Net earnings (loss) attributable to FIS common stockholders | $ | 248.9 | $ | 412.8 | $ | 5.9 | $ | (418.7 | ) | $ | 248.9 | ||||||||
Comprehensive earnings (loss) attributable to FIS | $ | 208.6 | $ | 414.5 | $ | (38.2 | ) | $ | (376.3 | ) | $ | 208.6 |
Condensed Consolidating Statements of Earnings and Comprehensive Earnings | |||||||||||||||||||
Six months ended June 30, 2012 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Processing and services revenues | $ | — | $ | 2,266.0 | $ | 604.6 | $ | — | $ | 2,870.6 | |||||||||
Operating expenses | 103.6 | 1,725.3 | 536.5 | — | 2,365.4 | ||||||||||||||
Operating income | (103.6 | ) | 540.7 | 68.1 | — | 505.2 | |||||||||||||
Other income (expense): | |||||||||||||||||||
Interest expense, net | (113.3 | ) | (0.5 | ) | (2.2 | ) | — | (116.0 | ) | ||||||||||
Other income (expense) | (17.7 | ) | (1.0 | ) | (4.0 | ) | — | (22.7 | ) | ||||||||||
Net earnings (loss) of equity affiliates | 414.8 | — | — | (414.8 | ) | — | |||||||||||||
Total other income (expense) | 283.8 | (1.5 | ) | (6.2 | ) | (414.8 | ) | (138.7 | ) | ||||||||||
Earnings (loss) from continuing operations before income taxes | 180.2 | 539.2 | 61.9 | (414.8 | ) | 366.5 | |||||||||||||
Provision for income taxes | (73.3 | ) | 164.5 | 21.8 | — | 113.0 | |||||||||||||
Net earnings (loss) from continuing operations | 253.5 | 374.7 | 40.1 | (414.8 | ) | 253.5 | |||||||||||||
Earnings (loss) from discontinued operations, net of tax | (9.6 | ) | 8.5 | (18.1 | ) | 9.6 | (9.6 | ) | |||||||||||
Net earnings (loss) | 243.9 | 383.2 | 22.0 | (405.2 | ) | 243.9 | |||||||||||||
Net (earnings) loss attributable to noncontrolling interest | (6.2 | ) | 0.4 | (6.6 | ) | 6.2 | (6.2 | ) | |||||||||||
Net earnings (loss) attributable to FIS common stockholders | $ | 237.7 | $ | 383.6 | $ | 15.4 | $ | (399.0 | ) | $ | 237.7 | ||||||||
Comprehensive earnings (loss) attributable to FIS | $ | 221.5 | $ | 384.6 | $ | 7.9 | $ | (392.5 | ) | $ | 221.5 |
Condensed Consolidating Statements of Cash Flows | |||||||||||||||||||
Six months ended June 30, 2013 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Cash flows from operating activities | $ | (83.3 | ) | $ | 451.5 | $ | (6.9 | ) | $ | 3.5 | $ | 364.8 | |||||||
Cash flows from investing activities | (33.7 | ) | (121.6 | ) | (127.8 | ) | — | (283.1 | ) | ||||||||||
Cash flows from financing activities | 111.5 | (349.8 | ) | 317.3 | (3.5 | ) | 75.5 | ||||||||||||
Effect of foreign currency exchange rates on cash | — | — | (21.7 | ) | — | (21.7 | ) | ||||||||||||
Net increase (decrease) in cash | $ | (5.5 | ) | $ | (19.9 | ) | $ | 160.9 | $ | — | $ | 135.5 |
Condensed Consolidating Statements of Cash Flows | |||||||||||||||||||
Six months ended June 30, 2012 | |||||||||||||||||||
Guarantor | Non-guarantor | ||||||||||||||||||
FIS | subsidiaries | subsidiaries | Eliminations | Consolidated | |||||||||||||||
(in millions) | |||||||||||||||||||
Cash flows from operating activities | $ | (46.6 | ) | $ | 487.2 | $ | 22.2 | $ | (0.1 | ) | $ | 462.7 | |||||||
Cash flows from investing activities | (10.6 | ) | (132.4 | ) | (54.4 | ) | — | (197.4 | ) | ||||||||||
Cash flows from financing activities | 54.8 | (326.1 | ) | 131.0 | 0.1 | (140.2 | ) | ||||||||||||
Effect of foreign currency exchange rates on cash | — | — | (6.8 | ) | — | (6.8 | ) | ||||||||||||
Net increase (decrease) in cash | $ | (2.4 | ) | $ | 28.7 | $ | 92.0 | $ | — | $ | 118.3 |
• | These matters raise difficult and complicated factual and legal issues and are subject to many uncertainties and complexities. |
• | The Company reviews all of its litigation matters on an on-going basis and follows the authoritative provisions for accounting for contingencies when making accrual and disclosure decisions. A liability must be accrued if (a) it is probable that a liability has been incurred and (b) the amount of loss can be reasonably estimated. If one of these criteria has not been met, disclosure is required when there is at least a reasonable possibility that a material loss may be incurred. When assessing reasonably possible and probable outcomes, the Company bases decisions on the assessment of the ultimate outcome following all appeals. Legal fees associated with defending these matters are expensed as incurred. |
FSG | PSG | ISG | Corporate and Other | Total | |||||||||||||||
Processing and services revenues | $ | 587.0 | $ | 623.1 | $ | 303.5 | $ | (1.1 | ) | $ | 1,512.5 | ||||||||
Operating expenses | 396.2 | 380.3 | 257.2 | 231.2 | 1,264.9 | ||||||||||||||
Operating income | $ | 190.8 | $ | 242.8 | $ | 46.3 | $ | (232.3 | ) | 247.6 | |||||||||
Other income (expense) unallocated | (111.3 | ) | |||||||||||||||||
Income from continuing operations before income taxes | $ | 136.3 | |||||||||||||||||
Depreciation and amortization | $ | 40.4 | $ | 20.1 | $ | 18.7 | $ | 73.1 | $ | 152.3 | |||||||||
Capital expenditures (1) | $ | 48.2 | $ | 16.0 | $ | 17.7 | $ | 1.6 | $ | 83.5 | |||||||||
Total assets | $ | 5,441.8 | $ | 4,709.4 | $ | 1,950.6 | $ | 1,645.5 | $ | 13,747.3 | |||||||||
Goodwill | $ | 4,057.1 | $ | 3,833.1 | $ | 597.2 | $ | — | $ | 8,487.4 |
(1) | Includes capital leases of $0.3 million primarily consisting of computer hardware and software. |
FSG | PSG | ISG | Corporate and Other | Total | |||||||||||||||
Processing and services revenues | $ | 563.4 | $ | 606.1 | $ | 287.3 | $ | 0.4 | $ | 1,457.2 | |||||||||
Operating expenses | 390.7 | 378.5 | 242.6 | 162.7 | 1,174.5 | ||||||||||||||
Operating income | $ | 172.7 | $ | 227.6 | $ | 44.7 | $ | (162.3 | ) | 282.7 | |||||||||
Other income (expense) unallocated | (58.4 | ) | |||||||||||||||||
Income from continuing operations before income taxes | $ | 224.3 | |||||||||||||||||
Depreciation and amortization | $ | 42.3 | $ | 22.0 | $ | 18.6 | $ | 72.2 | $ | 155.1 | |||||||||
Capital expenditures (1) | $ | 57.1 | $ | 13.8 | $ | 16.2 | $ | 3.1 | $ | 90.2 | |||||||||
Total assets | $ | 5,303.9 | $ | 4,687.5 | $ | 1,858.8 | $ | 1,779.4 | $ | 13,629.6 | |||||||||
Goodwill | $ | 3,941.1 | $ | 3,831.6 | $ | 596.1 | $ | — | $ | 8,368.8 |
(1) | Includes capital leases of $0.3 million primarily consisting of computer hardware and software. |
FSG | PSG | ISG | Corporate and Other | Total | |||||||||||||||
Processing and services revenues | $ | 1,162.3 | $ | 1,234.9 | $ | 595.1 | $ | (1.8 | ) | $ | 2,990.5 | ||||||||
Operating expenses | 783.1 | 753.6 | 508.5 | 422.6 | 2,467.8 | ||||||||||||||
Operating income | $ | 379.2 | $ | 481.3 | $ | 86.6 | $ | (424.4 | ) | 522.7 | |||||||||
Other income (expense) unallocated | (157.9 | ) | |||||||||||||||||
Income from continuing operations before income taxes | $ | 364.8 | |||||||||||||||||
Depreciation and amortization | $ | 79.6 | $ | 39.9 | $ | 37.5 | $ | 148.5 | $ | 305.5 | |||||||||
Capital expenditures (1) | $ | 88.8 | $ | 30.4 | $ | 35.1 | $ | 4.7 | $ | 159.0 |
(1) | Includes capital leases of $2.0 million primarily consisting of computer hardware and software. |
FSG | PSG | ISG | Corporate and Other | Total | |||||||||||||||
Processing and services revenues | $ | 1,102.3 | $ | 1,203.2 | $ | 564.1 | $ | 1.0 | $ | 2,870.6 | |||||||||
Operating expenses | 762.8 | 759.4 | 486.4 | 356.8 | 2,365.4 | ||||||||||||||
Operating income | $ | 339.5 | $ | 443.8 | $ | 77.7 | $ | (355.8 | ) | 505.2 | |||||||||
Other income (expense) unallocated | (138.7 | ) | |||||||||||||||||
Income from continuing operations before income taxes | $ | 366.5 | |||||||||||||||||
Depreciation and amortization | $ | 83.4 | $ | 43.7 | $ | 37.0 | $ | 144.9 | $ | 309.0 | |||||||||
Capital expenditures (1) | $ | 98.4 | $ | 24.1 | $ | 26.9 | $ | 6.3 | $ | 155.7 |
(1) | Includes capital leases of $1.8 million primarily consisting of computer hardware and software. |
• | changes in general economic, business and political conditions, including the possibility of intensified international hostilities, acts of terrorism, and changes in either or both the United States and international lending, capital and financial markets; |
• | the effect of legislative initiatives or proposals, statutory changes, governmental or other applicable regulations and/or changes in industry requirements, including privacy 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 the theft of personal information and computer viruses affecting our software or platforms, and the reactions of customers, card associations, government regulators and others to any such events; |
• | the reaction of our current and potential customers to future communications from us or our regulators regarding information security, risk management, internal audit or other matters; |
• | competitive pressures on pricing related to our solutions including the ability to attract new, or retain existing, customers; |
• | an operational or natural disaster at one of our major operations centers; |
• | and other risks detailed elsewhere in the “Statement Regarding Forward-Looking Information,” “Risk Factors” section and other sections of the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, the Form 10-Q for the three months ended March 31, 2013, this Form 10-Q and our other filings with the Securities and Exchange Commission. |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Processing and services revenues | $ | 1,512.5 | $ | 1,457.2 | $ | 2,990.5 | $ | 2,870.6 | |||||||
Cost of revenues | 1,028.2 | 981.1 | 2,036.2 | 1,970.6 | |||||||||||
Gross profit | 484.3 | 476.1 | 954.3 | 900.0 | |||||||||||
Selling, general, and administrative expenses | 236.7 | 193.4 | 431.6 | 394.8 | |||||||||||
Operating income | 247.6 | 282.7 | 522.7 | 505.2 | |||||||||||
Other income (expense): | |||||||||||||||
Interest expense, net | (49.4 | ) | (56.6 | ) | (101.1 | ) | (116.0 | ) | |||||||
Other income (expense), net | (61.9 | ) | (1.8 | ) | (56.8 | ) | (22.7 | ) | |||||||
Total other income (expense), net | (111.3 | ) | (58.4 | ) | (157.9 | ) | (138.7 | ) | |||||||
Earnings from continuing operations before income taxes | 136.3 | 224.3 | 364.8 | 366.5 | |||||||||||
Provision for income taxes | 40.9 | 65.3 | 116.1 | 113.0 | |||||||||||
Earnings from continuing operations, net of tax | 95.4 | 159.0 | 248.7 | 253.5 | |||||||||||
Earnings (loss) from discontinued operations, net of tax | 13.6 | (5.2 | ) | 9.7 | (9.6 | ) | |||||||||
Net earnings | 109.0 | 153.8 | 258.4 | 243.9 | |||||||||||
Net (earnings) loss attributable to noncontrolling interest | (4.2 | ) | (3.2 | ) | (9.5 | ) | (6.2 | ) | |||||||
Net earnings attributable to FIS | $ | 104.8 | $ | 150.6 | $ | 248.9 | $ | 237.7 | |||||||
Net earnings per share — basic from continuing operations attributable to FIS common stockholders | $ | 0.31 | $ | 0.53 | $ | 0.82 | $ | 0.85 | |||||||
Net earnings (loss) per share — basic from discontinued operations attributable FIS common stockholders | 0.05 | (0.02 | ) | 0.03 | (0.03 | ) | |||||||||
Net earnings per share — basic attributable to FIS common stockholders | $ | 0.36 | $ | 0.51 | $ | 0.86 | $ | 0.82 | |||||||
Weighted average shares outstanding — basic | 289.9 | 292.7 | 290.5 | 291.2 | |||||||||||
Net earnings per share — diluted from continuing operations attributable to FIS common stockholders | $ | 0.31 | $ | 0.52 | $ | 0.81 | $ | 0.83 | |||||||
Net earnings (loss) per share — diluted from discontinued operations attributable to FIS common stockholders | 0.05 | (0.02 | ) | 0.03 | (0.03 | ) | |||||||||
Net earnings per share — diluted attributable to FIS common stockholders | $ | 0.36 | $ | 0.50 | $ | 0.84 | $ | 0.80 | |||||||
Weighted average shares outstanding — diluted | 294.3 | 298.3 | 294.8 | 296.8 | |||||||||||
Amounts attributable to FIS common stockholders: | |||||||||||||||
Earnings from continuing operations, net of tax | $ | 91.2 | $ | 155.8 | $ | 239.2 | $ | 247.3 | |||||||
Earnings (loss) from discontinued operations, net of tax | 13.6 | (5.2 | ) | 9.7 | (9.6 | ) | |||||||||
Net earnings attributable to FIS | $ | 104.8 | $ | 150.6 | $ | 248.9 | $ | 237.7 |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
ClearPar | $ | 16.7 | $ | — | $ | 16.7 | $ | — | ||||||||
Healthcare Business | — | 4.1 | — | 8.4 | ||||||||||||
Participacoes | (3.1 | ) | (9.3 | ) | (7.0 | ) | (18.0 | ) | ||||||||
Total discontinued operations | $ | 13.6 | $ | (5.2 | ) | $ | 9.7 | $ | (9.6 | ) |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Processing and services revenues | $ | 587.0 | $ | 563.4 | $ | 1,162.3 | $ | 1,102.3 | |||||||
Operating income | $ | 190.8 | $ | 172.7 | $ | 379.2 | $ | 339.5 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Processing and services revenues | $ | 623.1 | $ | 606.1 | $ | 1,234.9 | $ | 1,203.2 | |||||||
Operating income | $ | 242.8 | $ | 227.6 | $ | 481.3 | $ | 443.8 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Processing and services revenues | $ | 303.5 | $ | 287.3 | $ | 595.1 | $ | 564.1 | |||||||
Operating income | $ | 46.3 | $ | 44.7 | $ | 86.6 | $ | 77.7 |
Effective date | Termination date | Notional amount | Bank pays variable rate of | FIS pays fixed rate of | ||||||||
September 1, 2011 | September 1, 2014 | $ | 150.0 | 1 Month LIBOR (1) | 0.74 | % | (2) | |||||
September 1, 2011 | September 1, 2014 | 150.0 | 1 Month LIBOR (1) | 0.74 | % | (2) | ||||||
September 1, 2011 | September 1, 2014 | 300.0 | 1 Month LIBOR (1) | 0.72 | % | (2) | ||||||
July 1, 2012 | July 1, 2015 | 300.0 | 1 Month LIBOR (1) | 0.58 | % | (2) | ||||||
February 1, 2013 | February 3, 2014 | 200.0 | 1 Month LIBOR (1) | 0.28 | % | (2) | ||||||
February 1, 2013 | February 3, 2014 | 200.0 | 1 Month LIBOR (1) | 0.28 | % | (2) | ||||||
February 3, 2014 | February 1, 2017 | 400.0 | 1 Month LIBOR (1) | 0.89 | % | (2) | ||||||
$ | 1,700.0 |
(1) | 0.19% in effect as of June 30, 2013. |
(2) | Does not include the applicable margin and facility fees paid to lenders on Term Loans and the Revolving Loan as described in note 7 to the Condensed Consolidated Financial Statements (Unaudited). |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
Currency | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Real | $ | 10.5 | $ | 9.6 | $ | 21.0 | $ | 20.1 | ||||||||
Euro | 6.6 | 6.8 | 12.8 | 13.4 | ||||||||||||
Pound Sterling | 4.9 | 4.6 | 9.4 | 8.6 | ||||||||||||
Indian Rupee | 1.3 | 1.0 | 2.5 | 1.9 | ||||||||||||
Total increase (decrease) | $ | 23.3 | $ | 22.0 | $ | 45.7 | $ | 44.0 |
• | These matters raise difficult and complicated factual and legal issues and are subject to many uncertainties and complexities. |
• | The Company reviews all of its litigation on an on-going basis and follows the authoritative provisions for accounting for contingencies when making accrual and disclosure decisions. A liability must be accrued if (a) it is probable that a liability has been incurred and (b) the amount of loss can be reasonably estimated. If one of these criteria has not been met, disclosure is required when there is at least a reasonable possibility that a material loss may be incurred. When assessing reasonably possible and probable outcomes, the Company bases decisions on the assessment of the ultimate outcome following all appeals. Legal fees associated with defending litigation matters are expensed as incurred. |
Approximate dollar | |||||||||||||||
value of shares that | |||||||||||||||
Total cost of shares | may yet be | ||||||||||||||
purchased as part of | purchased under | ||||||||||||||
Total number of | publicly announced | the plans or | |||||||||||||
shares purchased | Average price | plans or programs | programs (1) | ||||||||||||
Period | (in millions) | paid per share | (in millions) | (in millions) | |||||||||||
May 2013 | 2.8 | $ | 44.25 | $ | 125.0 | $ | 424.3 |
(1) | On February 7, 2012, our Board of Directors approved a plan authorizing additional repurchases of up to $1.0 billion of our outstanding common stock in the open market, at prevailing market prices or in privately negotiated transactions, through December 31, 2015. The previous authorization was replaced by the February 7, 2012 plan. During the 2013 second quarter, we repurchased 2.8 million shares of our common stock for $125.0 million at an average price of $44.25. Approximately $424.3 million of plan capacity remained available for repurchases as of June 30, 2013. |
Exhibit | ||
No. | Description | |
31.1 | Certification of Frank R. Martire, Chairman of the Board and Chief Executive Officer of Fidelity National Information Services, Inc., pursuant to rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of James W. Woodall, Corporate Executive Vice President and Chief Financial Officer of Fidelity National Information Services, Inc., pursuant to rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1 | Certification of Frank R. Martire, Chairman of the Board and Chief Executive Officer of Fidelity National Information Services, Inc., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2 | Certification of James W. Woodall, Corporate Executive Vice President and Chief Financial Officer of Fidelity National Information Services, Inc., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
FIDELITY NATIONAL INFORMATION SERVICES, INC. | ||
Date: August 2, 2013 | By: | /s/ JAMES W. WOODALL |
James W. Woodall | ||
Corporate Executive Vice President and Chief Financial Officer (Principal Financial Officer ) |
FIDELITY NATIONAL INFORMATION SERVICES, INC. | ||
Date: August 2, 2013 | By: | /s/ PETER J.S. SMITH |
Peter J.S. Smith | ||
Corporate Senior Vice President and Chief Accounting Officer (Principal Accounting Officer) |
Exhibit | ||
No. | Description | |
31.1 | Certification of Frank R. Martire, Chairman of the Board and Chief Executive Officer of Fidelity National Information Services, Inc., pursuant to rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of James W. Woodall, Corporate Executive Vice President and Chief Financial Officer of Fidelity National Information Services, Inc., pursuant to rule 13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1 | Certification of Frank R. Martire, Chairman of the Board and Chief Executive Officer of Fidelity National Information Services, Inc., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2 | Certification of James W. Woodall, Corporate Executive Vice President and Chief Financial Officer of Fidelity National Information Services, Inc., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
1. | I have reviewed this quarterly report on Form 10-Q of Fidelity National Information Services, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | August 2, 2013 | By: | /s/ Frank R. Martire |
Frank R. Martire | |||
Chairman of the Board and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Fidelity National Information Services, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | August 2, 2013 | By: | /s/ JAMES W. WOODALL |
James W. Woodall | |||
Corporate Executive Vice President and Chief Financial Officer | |||
(Principal Financial Officer) |
1. | The periodic report containing financial statements to which this certificate is an exhibit fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934. |
2. | The information contained in the periodic report to which this certificate is an exhibit fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: | August 2, 2013 | By: | /s/ Frank R. Martire |
Frank R. Martire | |||
Chairman of the Board and Chief Executive Officer |
1. | The periodic report containing financial statements to which this certificate is an exhibit fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934. |
2. | The information contained in the periodic report to which this certificate is an exhibit fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: | August 2, 2013 | By: | /s/ JAMES W. WOODALL |
James W. Woodall | |||
Corporate Executive Vice President and Chief Financial Officer | |||
(Principal Financial Officer) |
Commitments and Contingencies
|
6 Months Ended | ||||||||
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Jun. 30, 2013
|
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Commitments and Contingencies Disclosure [Abstract] | |||||||||
Commitments and Contingencies | Commitments and Contingencies Litigation In the ordinary course of business, the Company is involved in various pending and threatened litigation matters related to operations, some of which include claims for punitive or exemplary damages. The Company believes that no actions, other than the matters listed below, depart from customary litigation incidental to its business. As background to the disclosures below, please note the following:
CheckFree Corporation and CashEdge, Inc. v. Metavante Corporation and Fidelity National Information Services, Inc. This is a patent infringement action that was filed by CheckFree Corporation and CashEdge, Inc., wholly-owned subsidiaries of Fiserv, Inc., against Fidelity National Information Services, Inc. and our subsidiary, Metavante Corporation (collectively the “Defendants”) in the U.S. District Court for the Middle District of Florida, Jacksonville Division on January 5, 2012. The complaint seeks damages, injunctive relief and attorneys' fees for the alleged infringement of three patents. Plaintiffs allege that the Defendants infringe the patents at issue by providing customers financial and payment solutions that process payment instructions, provide electronic biller notifications, and/or process account-to-account funds transfer transactions and have requested financial damages and injunctive relief. Defendants filed their Answer and Counterclaims to Plaintiffs' complaint for patent infringement denying the claims of patent infringement and asserting defenses, including non-infringement and invalidity. Additionally, Defendants filed counterclaims asserting patent infringement of three patents and adding Fiserv, Inc. as a Counter Defendant. Defendants seek damages, injunctive relief and attorneys' fees. Plaintiffs and Counter Defendant Fiserv, Inc., filed their Answer to Defendants' counterclaims denying the claims of patent infringement and asserting defenses, including non-infringement and invalidity. In the fourth quarter of 2012, the Court granted Plaintiffs' Motion to Amend its First Amended Complaint to add a fourth patent and Defendants' Motion to Amend its First Amended Answer and Counterclaims. Defendants filed a Motion for Summary Judgment seeking an order invalidating all of the Plaintiffs' asserted patents. Plaintiffs filed a Motion for Summary Judgment seeking to invalidate select patent claims from one of Defendants' asserted patents. On June 24, 2013, Defendants filed for covered business method (“CBM”) post-grant reviews of the validity of the Plaintiff's asserted patents at the US Patent and Trademark Office. On June 25, 2013, Defendants filed a Motion to Stay the case pending the outcome of the CBM post-grant reviews. The Court has not yet ruled on either of the summary judgment motions or the motion to stay. Discovery is ongoing. If the case is not stayed, the trial date will be re-scheduled. An estimate of a possible loss or range of possible loss, if any, for this litigation cannot be made at this time. DataTreasury Corporation v. Fidelity National Information Services, Inc. et. al. This patent infringement lawsuit was filed on May 28, 2013 by DataTreasury Corporation (“DTC”) against Fidelity National Information Services, Inc. (the “Company”) and multiple customer banks in the US District Court for the Eastern District of Texas, Marshall Division. The Complaint seeks damages, injunctive relief and attorneys' fees for the alleged infringement of two patents. The Company has not yet been served. Based on what it is aware of at this early stage, the Company believes that it has strong defenses to this action. An estimate of a possible loss or range of possible loss, if any, for this action cannot be made at this time. Indemnifications and Warranties The Company generally indemnifies its customers, subject to certain exceptions, against damages and costs resulting from claims of patent, copyright, or trademark infringement associated with its customers' use of the Company's products or services. Historically, the Company has not made any material payments under such indemnifications, but continues to monitor the conditions that are subject to the indemnifications to identify whether it is probable that a loss has occurred, and would recognize any such losses when they are estimable. In addition, the Company warrants to customers that its software operates substantially in accordance with the software specifications. Historically, no material costs have been incurred related to software warranties and no accruals for warranty costs have been made. |
Related Party Transactions
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Jun. 30, 2013
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Related Party Transaction, Due from (to) Related Party [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions | Related Party Transactions We are a party to certain agreements with related parties described below. Revenues and Expenses Related party transactions included in revenues for the three and six months ended June 30, 2013 and 2012, are as follows (in millions):
The three and six months ended June 30, 2012 also included $1.1 million and $2.1 million, respectively, in expenses for administrative corporate support and other services with FNF (net of expense reimbursements) and $0.3 million and $0.5 million, respectively, of expenses related to employee benefits services provided by Ceridian. These costs were included in selling, general and administrative expenses. Brazilian Venture The Company operates a joint venture ("Brazilian Venture") with Banco Bradesco S.A. ("Banco Bradesco") in which we own a 51% controlling interest, to provide comprehensive, fully outsourced transaction processing, call center, cardholder support and collection services to multiple card issuing clients in Brazil, including Banco Bradesco. FNF FIS had shared a number of directors and executives with Fidelity National Financial, Inc. ("FNF"), our former parent, subsequent to becoming an independent company. As a result, FNF qualified as a related party from an accounting perspective. As previously reported, William P. Foley II, who serves as Chairman of the Board of Directors of FNF, transitioned from Executive Chairman to Chairman of the Board of FIS in February 2011, and then to Vice Chairman in March 2012. Certain other key executives shared between the two companies ended their employment with FIS during 2012. As a result, FNF's level of influence over the management or operating policies of FIS was diminished below the level required to meet the definition of a related party as of September 30, 2012. All transactions with FNF are, therefore, included in the related party disclosures through that date. Ceridian We provide data processing services to Ceridian Corporation (“Ceridian”), and Ceridian provides us with outsourced employee benefits services. FNF holds an approximate 32% equity interest in Ceridian; therefore, transactions with Ceridian are included as related party activity through September 30, 2012, consistent with the inclusion of FNF as addressed above. We believe the amounts earned from or charged by us under each of the foregoing arrangements are fair and reasonable. We believe our service arrangements are priced within the range of prices we offer to third parties. However, the amounts we earned or that we were charged under these arrangements were not negotiated at arm's-length, and may not represent the terms that we might have obtained from an unrelated third party. |
Changes in Accumulated Other Comprehensive Earnings Attributable to FIS by Component, Net of Tax (Tables)
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Jun. 30, 2013
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table shows accumulated other comprehensive earnings ("AOCE") attributable to FIS by component, net of tax, for the six months ended June 30, 2013 (in millions):
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Stock Purchase Right
|
6 Months Ended |
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Jun. 30, 2013
|
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Stock Purchase Right [Abstract] | |
Stock Purchase Right | Stock Purchase Right As of the date of acquisition of our subsidiary, Metavante Technologies, Inc. ("Metavante"), WPM, L.P., a Delaware limited partnership affiliated with Warburg Pincus Private Equity IX, L.P. (collectively “Warburg Pincus”) owned 25% of the outstanding shares of Metavante common stock, and was a party to a purchase right agreement with Metavante that granted Warburg Pincus the right to purchase additional shares of Metavante common stock under certain conditions in order to maintain its relative ownership interest. The Company and Warburg Pincus entered into a replacement stock purchase right agreement effective upon consummation of the Metavante merger, granting Warburg Pincus the right to purchase comparable FIS shares in lieu of Metavante shares. The purchase right agreement related to Metavante employee stock options that were outstanding as of the date of Warburg Pincus' initial investment in Metavante. As of May 23, 2013, in exchange for a cash payment of $4.9 million by FIS to Warburg Pincus, the parties terminated the stock purchase right agreement and the Warburg shareholders agreement, thereby eliminating any further rights and obligations with respect thereto. The cash payment was calculated as the value, on a net settlement exercise basis, of the purchase rights remaining under the agreement on the termination date. This payment was recorded as a reduction to additional paid in capital. |
Segment Information (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | |||||||||||||||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Dec. 31, 2012
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Segment Information | |||||||||||||||||
Processing and services revenues | $ 1,512.5 | $ 1,457.2 | $ 2,990.5 | $ 2,870.6 | |||||||||||||
Operating expenses | 1,264.9 | 1,174.5 | 2,467.8 | 2,365.4 | |||||||||||||
Operating income | 247.6 | 282.7 | 522.7 | 505.2 | |||||||||||||
Other income (expense) unallocated | (111.3) | (58.4) | (157.9) | (138.7) | |||||||||||||
Earnings from continuing operations before income taxes | 136.3 | 224.3 | 364.8 | 366.5 | |||||||||||||
Depreciation and amortization | 305.5 | 317.2 | |||||||||||||||
Capital expenditures | 83.5 | [1] | 90.2 | [2] | 159.0 | [3] | 155.7 | [4] | |||||||||
Total assets | 13,750.1 | 13,750.1 | 13,549.7 | ||||||||||||||
Goodwill | 8,487.4 | 8,368.8 | 8,487.4 | 8,368.8 | 8,381.5 | ||||||||||||
Segment Information (Textuals) [Abstract] | |||||||||||||||||
Capital lease obligations | 0.3 | 0.3 | 2.0 | 1.8 | |||||||||||||
Amount related to discontinued operations that is excluded from total asset | 2.8 | 313.4 | 2.8 | 313.4 | |||||||||||||
Continuing Operations [Member]
|
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Segment Information | |||||||||||||||||
Depreciation and amortization | 152.3 | 155.1 | 305.5 | 309.0 | |||||||||||||
Total assets | 13,747.3 | 13,629.6 | 13,747.3 | 13,629.6 | |||||||||||||
FSG [Member]
|
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Segment Information | |||||||||||||||||
Processing and services revenues | 587.0 | 563.4 | 1,162.3 | 1,102.3 | |||||||||||||
Operating expenses | 396.2 | 390.7 | 783.1 | 762.8 | |||||||||||||
Operating income | 190.8 | 172.7 | 379.2 | 339.5 | |||||||||||||
Capital expenditures | 48.2 | [1] | 57.1 | [2] | 88.8 | [3] | 98.4 | [4] | |||||||||
Goodwill | 4,057.1 | 3,941.1 | 4,057.1 | 3,941.1 | |||||||||||||
FSG [Member] | Continuing Operations [Member]
|
|||||||||||||||||
Segment Information | |||||||||||||||||
Depreciation and amortization | 40.4 | 42.3 | 79.6 | 83.4 | |||||||||||||
Total assets | 5,441.8 | 5,303.9 | 5,441.8 | 5,303.9 | |||||||||||||
PSG [Member]
|
|||||||||||||||||
Segment Information | |||||||||||||||||
Processing and services revenues | 623.1 | 606.1 | 1,234.9 | 1,203.2 | |||||||||||||
Operating expenses | 380.3 | 378.5 | 753.6 | 759.4 | |||||||||||||
Operating income | 242.8 | 227.6 | 481.3 | 443.8 | |||||||||||||
Capital expenditures | 16.0 | [1] | 13.8 | [2] | 30.4 | [3] | 24.1 | [4] | |||||||||
Goodwill | 3,833.1 | 3,831.6 | 3,833.1 | 3,831.6 | |||||||||||||
PSG [Member] | Continuing Operations [Member]
|
|||||||||||||||||
Segment Information | |||||||||||||||||
Depreciation and amortization | 20.1 | 22.0 | 39.9 | 43.7 | |||||||||||||
Total assets | 4,709.4 | 4,687.5 | 4,709.4 | 4,687.5 | |||||||||||||
ISG [Member]
|
|||||||||||||||||
Segment Information | |||||||||||||||||
Processing and services revenues | 303.5 | 287.3 | 595.1 | 564.1 | |||||||||||||
Operating expenses | 257.2 | 242.6 | 508.5 | 486.4 | |||||||||||||
Operating income | 46.3 | 44.7 | 86.6 | 77.7 | |||||||||||||
Capital expenditures | 17.7 | [1] | 16.2 | [2] | 35.1 | [3] | 26.9 | [4] | |||||||||
Goodwill | 597.2 | 596.1 | 597.2 | 596.1 | |||||||||||||
Segment Information (Textuals) [Abstract] | |||||||||||||||||
Long-term assets, excluding goodwill and other intangible assets | 354.1 | 375.5 | 354.1 | 375.5 | |||||||||||||
ISG [Member] | Continuing Operations [Member]
|
|||||||||||||||||
Segment Information | |||||||||||||||||
Depreciation and amortization | 18.7 | 18.6 | 37.5 | 37.0 | |||||||||||||
Total assets | 1,950.6 | 1,858.8 | 1,950.6 | 1,858.8 | |||||||||||||
Corporate and Other [Member]
|
|||||||||||||||||
Segment Information | |||||||||||||||||
Processing and services revenues | (1.1) | 0.4 | (1.8) | 1.0 | |||||||||||||
Operating expenses | 231.2 | 162.7 | 422.6 | 356.8 | |||||||||||||
Operating income | (232.3) | (162.3) | (424.4) | (355.8) | |||||||||||||
Capital expenditures | 1.6 | [1] | 3.1 | [2] | 4.7 | [3] | 6.3 | [4] | |||||||||
Goodwill | 0 | 0 | 0 | 0 | |||||||||||||
Corporate and Other [Member] | Continuing Operations [Member]
|
|||||||||||||||||
Segment Information | |||||||||||||||||
Depreciation and amortization | 73.1 | 72.2 | 148.5 | 144.9 | |||||||||||||
Total assets | $ 1,645.5 | $ 1,779.4 | $ 1,645.5 | $ 1,779.4 | |||||||||||||
|
Long-Term Debt (Details 2) (USD $)
In Millions, unless otherwise specified |
6 Months Ended | |||||
---|---|---|---|---|---|---|
Jun. 30, 2013
|
||||||
Interest rate swap | ||||||
Notional Amount | $ 1,700.0 | |||||
1 month LIBOR rate in effect | 0.19% | |||||
Interest Rate Swap One
|
||||||
Interest rate swap | ||||||
Effective Date | Sep. 01, 2011 | |||||
Termination Date | Sep. 01, 2014 | |||||
Notional Amount | 150.0 | |||||
Bank Pays Variable Rate of | 1 Month LIBOR (1) | [1] | ||||
FIS pays Fixed Rate of | 0.74% | [2] | ||||
Interest Rate Swap Two
|
||||||
Interest rate swap | ||||||
Effective Date | Sep. 01, 2011 | |||||
Termination Date | Sep. 01, 2014 | |||||
Notional Amount | 150.0 | |||||
Bank Pays Variable Rate of | 1 Month LIBOR (1) | [1] | ||||
FIS pays Fixed Rate of | 0.74% | [2] | ||||
Interest Rate Swap Three
|
||||||
Interest rate swap | ||||||
Effective Date | Sep. 01, 2011 | |||||
Termination Date | Sep. 01, 2014 | |||||
Notional Amount | 300.0 | |||||
Bank Pays Variable Rate of | 1 Month LIBOR (1) | [1] | ||||
FIS pays Fixed Rate of | 0.72% | [2] | ||||
Interest Rate Swap Four
|
||||||
Interest rate swap | ||||||
Effective Date | Jul. 01, 2012 | |||||
Termination Date | Jul. 01, 2015 | |||||
Notional Amount | 300.0 | |||||
Bank Pays Variable Rate of | 1 Month LIBOR (1) | [1] | ||||
FIS pays Fixed Rate of | 0.58% | [2] | ||||
Interest Rate Swap Five
|
||||||
Interest rate swap | ||||||
Effective Date | Feb. 01, 2013 | |||||
Termination Date | Feb. 03, 2014 | |||||
Notional Amount | 200.0 | |||||
Bank Pays Variable Rate of | 1 Month LIBOR (1) | [1] | ||||
FIS pays Fixed Rate of | 0.28% | [2] | ||||
Interest Rate Swap Six
|
||||||
Interest rate swap | ||||||
Effective Date | Feb. 01, 2013 | |||||
Termination Date | Feb. 03, 2014 | |||||
Notional Amount | 200.0 | |||||
Bank Pays Variable Rate of | 1 Month LIBOR (1) | [1] | ||||
FIS pays Fixed Rate of | 0.28% | [2] | ||||
Interest Rate Swap Seven
|
||||||
Interest rate swap | ||||||
Effective Date | Feb. 03, 2014 | |||||
Termination Date | Feb. 01, 2017 | |||||
Notional Amount | $ 400.0 | |||||
Bank Pays Variable Rate of | 1 Month LIBOR (1) | [1] | ||||
FIS pays Fixed Rate of | 0.89% | [2] | ||||
|
Supplemental Guarantor Financial Information (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Supplemental Guarantor Financial Information (Tables) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidating Balance Sheet |
|
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Condensed Consolidating Statement of Earnings |
|
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Condensed Consolidating Statements of Cash Flows |
|
Long-Term Debt (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long Term Debts | Long-term debt as of June 30, 2013 and December 31, 2012, consisted of the following (in millions):
__________________________________________
|
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Principal maturities of long-term debt | The following table summarizes the mandatory annual principal payments pursuant to the FIS Credit Agreement and the senior notes' indentures as of June 30, 2013 (in millions). There are no mandatory principal payments on the Revolving Loan and any balance outstanding on the Revolving Loan will be due and payable at its scheduled maturity date:
|
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Interest rate swap | As of June 30, 2013, we have entered into the following interest rate swap transactions converting a portion of the interest rate exposure on our Term and Revolving Loans from variable to fixed (in millions):
___________________________________
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Fair value of derivative instruments | A summary of the fair value of the Company’s derivative instruments as of June 30, 2013 and December 31, 2012, is as follows (in millions):
|
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Effect of derivative instruments on the Company's Condensed Consolidated Statements of Earnings | A summary of the effect of derivative instruments on the Company’s Condensed Consolidated Statements of Comprehensive Earnings (Unaudited) and recognized in AOCE for the three and six months ended June 30, 2013 and 2012 is as follows (in millions):
|
Stock Purchase Right (Details Textuals) (USD $)
In Millions, unless otherwise specified |
May 23, 2013
|
Oct. 02, 2009
Metavante [Member]
|
---|---|---|
Business Acquisition [Line Items] | ||
Percentage of equity interest (as a percent) | 25.00% | |
Payment in settlement of stock purchase right | $ 4.9 |
Changes in Accumulated Other Comprehensive Earnings Attributable to FIS by Component, Net of Tax (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax Beginning Balance | $ 30.0 | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax Ending Balance | (10.3) | (10.3) | ||
Interest expense, net | (49.4) | (56.6) | (101.1) | (116.0) |
Provision for income taxes | 40.9 | 65.3 | 116.1 | 113.0 |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
|
||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax Beginning Balance | (6.1) | |||
Other comprehensive gain/(loss) before reclassifications | 2.9 | |||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 1.8 | |||
Other comprehensive earnings | 4.7 | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax Ending Balance | (1.4) | (1.4) | ||
Accumulated Translation Adjustment [Member]
|
||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax Beginning Balance | 36.3 | |||
Other comprehensive gain/(loss) before reclassifications | (42.5) | |||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | |||
Other comprehensive earnings | (42.5) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax Ending Balance | (6.2) | (6.2) | ||
Accumulated Other Comprehenive Income Other [Member]
|
||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax Beginning Balance | (0.2) | |||
Other comprehensive gain/(loss) before reclassifications | (2.5) | |||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | |||
Other comprehensive earnings | (2.5) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax Ending Balance | (2.7) | (2.7) | ||
Accumulated Other Comprehensive Income (Loss) [Member]
|
||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax Beginning Balance | 30.0 | |||
Other comprehensive gain/(loss) before reclassifications | (42.1) | |||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 1.8 | |||
Other comprehensive earnings | (40.3) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax Ending Balance | (10.3) | (10.3) | ||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Interest Rate Contract [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
|
||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Interest expense, net | 3.0 | |||
Provision for income taxes | $ 1.2 |
Long-Term Debt (Details 4) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Interest expense
|
||||
Effect of derivative instruments | ||||
Amount of loss reclassified from AOCE into income | $ (1.3) | $ (1.5) | $ (3.0) | $ (4.1) |
Interest rate swap contracts
|
||||
Effect of derivative instruments | ||||
Amount of loss recognized in AOCE on derivatives | $ 4.8 | $ (2.8) | $ 4.8 | $ (4.6) |
Acquisitions (Details) (USD $)
In Millions, unless otherwise specified |
6 Months Ended | 1 Months Ended | 6 Months Ended | 3 Months Ended | |
---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Mar. 31, 2013
mFoundry [Member]
|
Jun. 30, 2013
mFoundry [Member]
|
Jun. 30, 2013
Capco [Member]
|
|
Business Acquisition [Line Items] | |||||
Cost of acquired entity | $ 130.1 | $ 41.7 | $ 115.0 | ||
Gain on mFoundry acquisition | 9.2 | 0 | 9.2 | ||
Acquisition contingent payment liability increase, determined upon operating results | $ 50.2 |
Unaudited Net Earnings per Share (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|||||||
Earnings Per Share [Abstract] | ||||||||||
Earnings from continuing operations attributable to FIS, net of tax | $ 91.2 | $ 155.8 | $ 239.2 | $ 247.3 | ||||||
Earnings (loss) from discontinued operations attributable to FIS, net of tax | 13.6 | (5.2) | 9.7 | (9.6) | ||||||
Net earnings attributable to FIS | $ 104.8 | $ 150.6 | $ 248.9 | $ 237.7 | ||||||
Weighted average shares outstanding — basic | 289.9 | 292.7 | 290.5 | 291.2 | ||||||
Plus: Common stock equivalent shares | 4.4 | 5.6 | 4.3 | 5.6 | ||||||
Weighted average shares outstanding — diluted | 294.3 | 298.3 | 294.8 | 296.8 | ||||||
Net earnings per share — basic from continuing operations attributable to FIS common stockholders | $ 0.31 | $ 0.53 | $ 0.82 | $ 0.85 | ||||||
Net earnings (loss) per share — basic from discontinued operations attributable to FIS common stockholders | $ 0.05 | $ (0.02) | $ 0.03 | $ (0.03) | ||||||
Net earnings per share — basic attributable to FIS common stockholders | $ 0.36 | [1] | $ 0.51 | [1] | $ 0.86 | [1] | $ 0.82 | [1] | ||
Net earnings per share — diluted from continuing operations attributable to FIS common stockholders | $ 0.31 | $ 0.52 | $ 0.81 | $ 0.83 | ||||||
Net earnings (loss) per share — diluted from discontinued operations attributable to FIS common stockholders | $ 0.05 | $ (0.02) | $ 0.03 | $ (0.03) | ||||||
Net earnings per share — diluted attributable to FIS common stockholders | $ 0.36 | [1] | $ 0.50 | [1] | $ 0.84 | [1] | $ 0.80 | [1] | ||
|
Supplemental Guarantor Financial Information Income Statement (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Condensed Consolidating Statement of Earnings | ||||
Processing and services revenues | $ 1,512.5 | $ 1,457.2 | $ 2,990.5 | $ 2,870.6 |
Operating expenses | 1,264.9 | 1,174.5 | 2,467.8 | 2,365.4 |
Operating income | 247.6 | 282.7 | 522.7 | 505.2 |
Other income (expense): | ||||
Interest expense, net | (49.4) | (56.6) | (101.1) | (116.0) |
Other income (expense) | (61.9) | (1.8) | (56.8) | (22.7) |
Net earnings (loss) of equity affiliates | 0 | 0 | 0 | 0 |
Total other income (expense) | (111.3) | (58.4) | (157.9) | (138.7) |
Earnings (loss) from continuing operations before income taxes | 136.3 | 224.3 | 364.8 | 366.5 |
Provision for income taxes | 40.9 | 65.3 | 116.1 | 113.0 |
Net earnings (loss) from continuing operations | 95.4 | 159.0 | 248.7 | 253.5 |
Earnings (loss) from discontinued operations, net of tax | 13.6 | (5.2) | 9.7 | (9.6) |
Net earnings | 109.0 | 153.8 | 258.4 | 243.9 |
Net (earnings) loss attributable to noncontrolling interest | (4.2) | (3.2) | (9.5) | (6.2) |
Net earnings (loss) attributable to FIS common stockholders | 104.8 | 150.6 | 248.9 | 237.7 |
Comprehensive earnings (loss) attributable to FIS | 73.5 | 107.7 | 208.6 | 221.5 |
FIS [Member]
|
||||
Condensed Consolidating Statement of Earnings | ||||
Processing and services revenues | 0 | 0 | 0 | 0 |
Operating expenses | 56.6 | 39.1 | 118.1 | 103.6 |
Operating income | (56.6) | (39.1) | (118.1) | (103.6) |
Other income (expense): | ||||
Interest expense, net | (48.1) | (55.2) | (98.3) | (113.3) |
Other income (expense) | (63.8) | (1.3) | (54.2) | (17.7) |
Net earnings (loss) of equity affiliates | 212.9 | 227.7 | 435.2 | 414.8 |
Total other income (expense) | 101.0 | 171.2 | 282.7 | 283.8 |
Earnings (loss) from continuing operations before income taxes | 44.4 | 132.1 | 164.6 | 180.2 |
Provision for income taxes | (51.0) | (26.9) | (84.1) | (73.3) |
Net earnings (loss) from continuing operations | 95.4 | 159.0 | 248.7 | 253.5 |
Earnings (loss) from discontinued operations, net of tax | 13.6 | (5.2) | 9.7 | (9.6) |
Net earnings | 109.0 | 153.8 | 258.4 | 243.9 |
Net (earnings) loss attributable to noncontrolling interest | (4.2) | (3.2) | (9.5) | (6.2) |
Net earnings (loss) attributable to FIS common stockholders | 104.8 | 150.6 | 248.9 | 237.7 |
Comprehensive earnings (loss) attributable to FIS | 73.5 | 107.7 | 208.6 | 221.5 |
Guarantor Subsidiaries [Member]
|
||||
Condensed Consolidating Statement of Earnings | ||||
Processing and services revenues | 1,180.8 | 1,145.5 | 2,340.2 | 2,266.0 |
Operating expenses | 876.0 | 858.4 | 1,742.4 | 1,725.3 |
Operating income | 304.8 | 287.1 | 597.8 | 540.7 |
Other income (expense): | ||||
Interest expense, net | (0.4) | (0.5) | (0.8) | (0.5) |
Other income (expense) | 3.1 | 2.9 | 3.2 | (1.0) |
Net earnings (loss) of equity affiliates | 0 | 0 | 0 | 0 |
Total other income (expense) | 2.7 | 2.4 | 2.4 | (1.5) |
Earnings (loss) from continuing operations before income taxes | 307.5 | 289.5 | 600.2 | 539.2 |
Provision for income taxes | 92.9 | 81.5 | 187.8 | 164.5 |
Net earnings (loss) from continuing operations | 214.6 | 208.0 | 412.4 | 374.7 |
Earnings (loss) from discontinued operations, net of tax | 0 | 4.2 | 0.1 | 8.5 |
Net earnings | 214.6 | 212.2 | 412.5 | 383.2 |
Net (earnings) loss attributable to noncontrolling interest | 0.1 | 0 | 0.3 | 0.4 |
Net earnings (loss) attributable to FIS common stockholders | 214.7 | 212.2 | 412.8 | 383.6 |
Comprehensive earnings (loss) attributable to FIS | 216.1 | 212.1 | 414.5 | 384.6 |
Non-Guarantor Subsidiaries [Member]
|
||||
Condensed Consolidating Statement of Earnings | ||||
Processing and services revenues | 331.7 | 311.7 | 650.3 | 604.6 |
Operating expenses | 332.3 | 277.0 | 607.3 | 536.5 |
Operating income | (0.6) | 34.7 | 43.0 | 68.1 |
Other income (expense): | ||||
Interest expense, net | (0.9) | (0.9) | (2.0) | (2.2) |
Other income (expense) | (1.2) | (3.4) | (5.8) | (4.0) |
Net earnings (loss) of equity affiliates | 0 | 0 | 0 | 0 |
Total other income (expense) | (2.1) | (4.3) | (7.8) | (6.2) |
Earnings (loss) from continuing operations before income taxes | (2.7) | 30.4 | 35.2 | 61.9 |
Provision for income taxes | (1.0) | 10.7 | 12.4 | 21.8 |
Net earnings (loss) from continuing operations | (1.7) | 19.7 | 22.8 | 40.1 |
Earnings (loss) from discontinued operations, net of tax | (3.1) | (9.4) | (7.1) | (18.1) |
Net earnings | (4.8) | 10.3 | 15.7 | 22.0 |
Net (earnings) loss attributable to noncontrolling interest | (4.3) | (3.2) | (9.8) | (6.6) |
Net earnings (loss) attributable to FIS common stockholders | (9.1) | 7.1 | 5.9 | 15.4 |
Comprehensive earnings (loss) attributable to FIS | (44.6) | (27.4) | (38.2) | 7.9 |
Eliminations [Member]
|
||||
Condensed Consolidating Statement of Earnings | ||||
Processing and services revenues | 0 | 0 | 0 | 0 |
Operating expenses | 0 | 0 | 0 | 0 |
Operating income | 0 | 0 | 0 | 0 |
Other income (expense): | ||||
Interest expense, net | 0 | 0 | 0 | 0 |
Other income (expense) | 0 | 0 | 0 | 0 |
Net earnings (loss) of equity affiliates | (212.9) | (227.7) | (435.2) | (414.8) |
Total other income (expense) | (212.9) | (227.7) | (435.2) | (414.8) |
Earnings (loss) from continuing operations before income taxes | (212.9) | (227.7) | (435.2) | (414.8) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net earnings (loss) from continuing operations | (212.9) | (227.7) | (435.2) | (414.8) |
Earnings (loss) from discontinued operations, net of tax | 3.1 | 5.2 | 7.0 | 9.6 |
Net earnings | (209.8) | (222.5) | (428.2) | (405.2) |
Net (earnings) loss attributable to noncontrolling interest | 4.2 | 3.2 | 9.5 | 6.2 |
Net earnings (loss) attributable to FIS common stockholders | (205.6) | (219.3) | (418.7) | (399.0) |
Comprehensive earnings (loss) attributable to FIS | $ (171.5) | $ (184.7) | $ (376.3) | $ (392.5) |
Condensed Consolidated Financial Statement Details (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Condensed Consolidated Financial Statement Details (Tables) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidated Financial Statement Details | The following tables show the Company’s condensed consolidated financial statement details as of June 30, 2013 and December 31, 2012 (in millions):
|
Condensed Consolidated Statement of Equity (USD $)
In Millions, unless otherwise specified |
Total
|
Common Stock
|
Additional Paid In Capital
|
Retained Earnings
|
Accumulated Other Comprehensive Earnings
|
Treasury Stock
|
Noncontrolling Interest
|
---|---|---|---|---|---|---|---|
Beginning Balance at Dec. 31, 2012 | $ 6,793.6 | $ 3.8 | $ 7,197.0 | $ 2,105.8 | $ 30.0 | $ (2,695.7) | $ 152.7 |
Beginning Balance (in shares) at Dec. 31, 2012 | 385.9 | (91.8) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of restricted stock (in shares) | 0.2 | ||||||
Exercise of stock options and stock purchase right (in shares) | 3.4 | ||||||
Exercise of stock options and stock purchase right | 64.5 | (33.9) | 98.4 | ||||
Treasury Shares Held For Taxes Due Upon Exercise Of Stock Options | (0.1) | ||||||
Treasury Shares Held For Taxes | (5.5) | (5.5) | |||||
Excess income tax benefit from exercise of stock options | 14.5 | 14.5 | |||||
Stock-based compensation | 29.5 | 29.5 | |||||
Cash dividends paid ($0.22 per share per quarter) and other distributions | (130.1) | (128.6) | (1.5) | ||||
Purchases of treasury stock (in shares) | (5.5) | ||||||
Purchases of treasury stock | (225.3) | (225.3) | |||||
Net earnings | 258.4 | 248.9 | 9.5 | ||||
Other comprehensive earnings | (49.4) | (40.3) | (9.1) | ||||
Ending Balance at Jun. 30, 2013 | $ 6,750.2 | $ 3.8 | $ 7,207.1 | $ 2,226.1 | $ (10.3) | $ (2,828.1) | $ 151.6 |
Ending Balance (in shares) at Jun. 30, 2013 | 386.1 | (94.0) |
Condensed Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified |
6 Months Ended | |
---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Cash flows from operating activities: | ||
Net earnings | $ 258.4 | $ 243.9 |
Adjustment to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 305.5 | 317.2 |
Amortization of debt issue costs | 14.6 | 24.6 |
ClearPar contingent consideration included in discontinued operations | (26.8) | 0 |
Gain on mFoundry acquisition | (9.2) | 0 |
Stock-based compensation | 26.4 | 42.9 |
Deferred income taxes | (24.7) | 5.8 |
Excess income tax benefit from exercise of stock options | (14.5) | (10.3) |
Other operating activities | 1.7 | 0 |
Net changes in assets and liabilities, net of effects from acquisitions and foreign currency: | ||
Trade receivables | (26.1) | (55.6) |
Settlement activity | (3.6) | (7.5) |
Prepaid expenses and other assets | (60.7) | (16.7) |
Deferred contract costs | (37.3) | (34.9) |
Deferred revenue | (26.0) | (21.0) |
Accounts payable, accrued liabilities, and other liabilities | (12.9) | (25.7) |
Net cash provided by operating activities | 364.8 | 462.7 |
Cash flows from investing activities: | ||
Additions to property and equipment | (59.5) | (66.6) |
Additions to computer software | (97.5) | (89.1) |
Receipt of contingent consideration from ClearPar sale | 26.8 | 0 |
Acquisitions, net of cash acquired, and equity investments | (130.1) | (41.7) |
Other investing activities, net | (22.8) | 0 |
Net cash used in investing activities | (283.1) | (197.4) |
Cash flows from financing activities: | ||
Borrowings | 7,151.6 | 7,483.3 |
Repayment of borrowings | (6,776.0) | (7,430.8) |
Debt issuance costs | (17.0) | (47.5) |
Excess income tax benefit from exercise of stock options | 14.5 | 10.3 |
Proceeds from exercise of stock options | 72.9 | 152.9 |
Treasury stock activity | (230.8) | (186.0) |
Dividends paid | (127.9) | (117.7) |
Other financing activities, net | (11.8) | (4.7) |
Net cash provided by (used in) financing activities | 75.5 | (140.2) |
Effect of foreign currency exchange rate changes on cash | (21.7) | (6.8) |
Net increase in cash and cash equivalents | 135.5 | 118.3 |
Cash and cash equivalents, beginning of period | 517.6 | 415.5 |
Cash and cash equivalents, end of period | 653.1 | 533.8 |
Supplemental cash flow information: | ||
Cash paid for interest | 112.9 | 97.8 |
Cash paid for income taxes | $ 186.7 | $ 87.3 |
Unaudited Net Earnings per Share
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unaudited Net Earnings per Share | Unaudited Net Earnings per Share The basic weighted average shares and common stock equivalents for the three and six months ended June 30, 2013 and 2012 are computed using the treasury stock method. The following table summarizes the earnings per share attributable to FIS common stockholders for the three and six months ended June 30, 2013 and 2012 (in millions, except per share amounts):
Options to purchase approximately 0.1 million and 0.4 million shares of our common stock for the three months and 1.6 million and 3.4 million for the six months ended June 30, 2013 and 2012, respectively, were not included in the computation of diluted earnings per share because they were anti-dilutive. |
Basis of Presentation
|
6 Months Ended |
---|---|
Jun. 30, 2013
|
|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited financial information included in this report includes the accounts of FIS and its subsidiaries prepared in accordance with U.S. generally accepted accounting principles and the instructions to Form 10-Q and Article 10 of Regulation S-X. All adjustments considered necessary for a fair presentation have been included. This report should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. The preparation of these Condensed Consolidated Financial Statements (Unaudited) in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements (Unaudited) and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates. Certain reclassifications have been made in the 2012 Condensed Consolidated Financial Statements (Unaudited) to conform to the classifications used in 2013. We report the results of our operations in four reporting segments: 1) Financial Solutions Group (“FSG”), 2) Payment Solutions Group (“PSG”), 3) International Solutions Group (“ISG”) and 4) Corporate and Other (Note 12). |
Long-Term Debt (Details Textuals) (USD $)
|
0 Months Ended | 6 Months Ended | 6 Months Ended | 0 Months Ended | 0 Months Ended | 6 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 15, 2013
|
Jun. 30, 2013
lender
|
Dec. 31, 2012
|
Jun. 30, 2013
FIS Credit Agreements
|
Jun. 30, 2013
FIS Credit Agreements March 2012
|
Jun. 30, 2013
Term Loan A-3
FIS Credit Agreements
|
Apr. 23, 2013
Revolving Credit Facility
|
Jun. 30, 2013
Revolving Credit Facility
FIS Credit Agreements
|
Jun. 30, 2013
Revolving Credit Facility
Letter of Credit
|
Apr. 15, 2013
2.0% Senior Notes Due 2018
|
Apr. 15, 2013
3.5% Senior Notes Due 2023
|
Apr. 15, 2013
7.625% Senior Notes Due 2017
|
Jun. 30, 2013
7.625% Senior Notes Due 2017
|
May 15, 2013
7.625% Senior Notes Due 2017
|
Jun. 30, 2013
FIS Credit Agreement, 2018 Notes, and 2023 Notes
Revolver, Term Loans, and Senior Notes
|
|
Debt Instrument [Line Items] | |||||||||||||||
Long-term Debt | $ 4,756,400,000 | $ 4,385,500,000 | $ 0 | ||||||||||||
Line of Credit Facility, Increase in Borrowing Capacity | 850,000,000 | ||||||||||||||
Revolving credit facility, maximum borrowing capacity | 2,000,000,000 | 2,000,000,000 | |||||||||||||
Total committed capital, credit agreement | 3,987,500,000 | ||||||||||||||
Term loans | 1,987,500,000 | ||||||||||||||
Credit facility Outstanding amount | 300,000,000 | 800,000 | |||||||||||||
Additional term and revolving loan capacity in the future | 1,699,200,000 | ||||||||||||||
Debt instrument, stated percentage | 2.00% | 3.50% | |||||||||||||
Proceeds from Issuance of Debt | 1,233,100,000 | ||||||||||||||
Call for redemption of notes | 801,600,000.0 | ||||||||||||||
Senior Notes | 250,000,000 | 1,000,000,000 | 750,000,000 | ||||||||||||
Early Repayment of Senior Debt | 51,600,000 | ||||||||||||||
Debt Instrument, Redemption Price, Percentage | 100.00% | ||||||||||||||
Number of top lenders (in lenders) | 10 | ||||||||||||||
Percentage share of revolving loan covered by top lenders | 58.00% | ||||||||||||||
Maximum loss of available capacity of revolving loan | 116,900,000 | ||||||||||||||
Debt related other capitalized costs | 29,300,000 | ||||||||||||||
Total debt issuance costs | 50,100,000 | 18,000,000 | |||||||||||||
Debt Issuance Cost | 2,000,000 | 18,400,000 | |||||||||||||
Early Redemption Premium Expense | 45,300,000 | ||||||||||||||
Write off of Deferred Debt Issuance Cost | 14,100,000 | ||||||||||||||
Fair Value Option Aggregate Differences Long Term Debt Instruments | 24,400,000 | ||||||||||||||
Amount of balance in AOCE | $ 1,400,000 |
Segment Information (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Summarized financial information for the Company’s segments is shown in the following tables. As of and for the three months ended June 30, 2013 (in millions):
As of and for the three months ended June 30, 2012 (in millions):
For the six months ended June 30, 2013 (in millions):
For the six months ended June 30, 2012 (in millions):
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Unaudited Net Earnings per Share Unaudited Net Earnings per Share Textuals (Details)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of earnings per share | 0.1 | 0.4 | 1.6 | 3.4 |
Long-Term Debt (Details 1) (USD $)
In Millions, unless otherwise specified |
Jun. 30, 2013
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Dec. 31, 2012
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Principal maturities of long-term debt | ||
Long term debt | $ 4,756.4 | $ 4,385.5 |
Term Loans A-4
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Principal maturities of long-term debt | ||
2013 | 25.0 | |
2014 | 100.0 | |
2015 | 100.0 | |
2016 | 100.0 | |
2017 | 1,662.5 | |
Thereafter | 0 | |
Long term debt | 1,987.5 | |
FIS Credit Agreements
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Principal maturities of long-term debt | ||
2013 | 25.0 | |
2014 | 100.0 | |
2015 | 100.0 | |
2016 | 100.0 | |
2017 | 1,662.5 | |
Thereafter | 2,450.0 | |
Long term debt | 4,437.5 | |
Senior Notes due 2018, interest payable semi-annually at 2.000%
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Principal maturities of long-term debt | ||
2013 | 0 | |
2014 | 0 | |
2015 | 0 | |
2016 | 0 | |
2017 | 0 | |
Thereafter | 250.0 | |
Long term debt | 250.0 | |
Senior Notes due 2020, interest payable semi-annually at 7.875%
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Principal maturities of long-term debt | ||
2013 | 0 | |
2014 | 0 | |
2015 | 0 | |
2016 | 0 | |
2017 | 0 | |
Thereafter | 500.0 | |
Long term debt | 500.0 | |
Senior Notes due 2022, interest payable semi-annually at 5.000%
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Principal maturities of long-term debt | ||
2013 | 0 | |
2014 | 0 | |
2015 | 0 | |
2016 | 0 | |
2017 | 0 | |
Thereafter | 700.0 | |
Long term debt | 700.0 | |
Senior Notes due 2023, interest payable semi-annually at 3.500%
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Principal maturities of long-term debt | ||
2013 | 0 | |
2014 | 0 | |
2015 | 0 | |
2016 | 0 | |
2017 | 0 | |
Thereafter | 1,000.0 | |
Long term debt | $ 1,000.0 |