Fiserv reports First Quarter 2015 Results
BROOKFIELD, WI (May 5, 2015) — Fiserv, Inc. (NASDAQ: FISV), a leading global provider of financial services technology solutions, today reported financial results for the first quarter of 2015.
GAAP revenue in the quarter was $1.28 billion compared with $1.23 billion in the first quarter of 2014. Adjusted revenue was $1.19 billion in the first quarter compared with $1.15 billion in the first quarter of 2014, an increase of 4 percent.
GAAP earnings per share from continuing operations in the first quarter was $0.73 compared with $0.65 in the first quarter of 2014. Adjusted earnings per share from continuing operations increased 9 percent to $0.89 compared with $0.82 in the first quarter of 2014.
“We are pleased with our strong start to the year,” said Jeffery Yabuki, President and Chief Executive Officer of Fiserv. “Results for the quarter were consistent with our full-year expectations, highlighted by strong operating performance and excellent growth in free cash flow.”
First Quarter 2015
- Adjusted revenue grew 4 percent in the quarter to $1.19 billion compared with $1.15 billion in the prior year period.
- Internal revenue growth was 4 percent for the company, with 4 percent growth in the Payments segment and 3 percent growth in the Financial segment. Foreign currency negatively impacted reported internal revenue growth by approximately 40 basis points in the quarter.
- Adjusted earnings per share increased 9 percent in the quarter to $0.89 compared with $0.82 in the prior year period.
- Adjusted operating income increased 8 percent in the quarter to $371 million compared with $342 million in the prior year period.
- Adjusted operating margin increased 150 basis points in the quarter, to 31.1 percent, compared with the first quarter of 2014.
- Free cash flow was up 15 percent to $268 million compared with $234 million in the prior year period.
- The company repurchased 3.8 million shares of common stock for $290 million in the first quarter and had 16.0 million remaining shares authorized for repurchase as of March 31, 2015.
- The company was named as one of FORTUNE® magazine’s World’s Most Admired Companies in the financial data services category for the second consecutive year.
- In April, the company was designated one of “America’s Best Employers” by Forbes magazine.
- On April 30, 2015, the company entered into an amendment to extend the maturity of its $2.0 billion revolving credit facility to April 2020.
Outlook for 2015
Fiserv continues to expect 2015 internal revenue growth in a range of 5 to 6 percent and adjusted earnings per share in a range of $3.73 to $3.83, which represents growth of 11 to 14 percent over $3.37 in 2014.
“We are on track to achieve full-year results within our 2015 guidance which anticipates stronger results in the second half of the year,” said Yabuki.
Earnings Conference Call
The company will discuss its first quarter 2015 results on a conference call and webcast at 4 p.m. CT on Tuesday, May 5, 2015. To register for the event, go to www.fiserv.com and click on the Q1 Earnings webcast link. Supplemental materials will be available in the “Investor Relations” section of the website.
Fiserv, Inc. (NASDAQ: FISV) enables clients to achieve best-in-class results by driving quality and innovation in payments, processing services, risk and compliance, customer and channel management, and business insights and optimization. For more than 30 years, Fiserv has been a leader in financial services technology, and today is among FORTUNE® magazine’s World’s Most Admired Companies and Forbes magazine’s America’s Best Employers. For more information, visit www.fiserv.com.
Use of Non-GAAP Financial Measures
In this earnings release, we supplement our reporting of information determined in accordance with GAAP, such as revenue, operating income, operating margin, income from continuing operations, earnings per share and net cash provided by operating activities, with “adjusted revenue,” “internal revenue growth,” “adjusted operating income,” “adjusted operating margin,” “adjusted income from continuing operations,” “adjusted earnings per share” and “free cash flow.” Management believes that adjustments for certain non-cash or other items and the exclusion of certain pass-through revenue and expenses enhance our shareholders’ ability to evaluate our performance because such items do not reflect how we manage our operations. Therefore, we exclude these items from GAAP revenue, operating income, operating margin, income from continuing operations, earnings per share and net cash provided by operating activities to calculate these non-GAAP measures.
Examples of non-cash or other items may include, but are not limited to, non-cash deferred revenue adjustments arising from acquisitions, non-cash intangible asset amortization expense associated with acquisitions, gains or losses from unconsolidated affiliates and divestitures, severance costs, merger and integration costs related to acquisitions, and certain costs associated with the achievement of our operational effectiveness objectives. We exclude these items to more clearly focus on the factors we believe are pertinent to the management of our operations, and we use this information to allocate resources to our various businesses.
Free cash flow and internal revenue growth are non-GAAP financial measures and are described on page 10. We believe free cash flow is useful to measure the funds generated in a given period that are available for strategic capital decisions. We believe internal revenue growth is useful because it presents revenue growth excluding the impact of postage reimbursements in our Output Solutions business, acquisitions and dispositions, and including deferred revenue purchase accounting adjustments. We believe this supplemental information enhances our shareholders’ ability to evaluate and understand our core business performance.
These non-GAAP measures should be considered in addition to, and not as a substitute for, revenue, operating income, operating margin, income from continuing operations, earnings per share and net cash provided by operating activities or any other amount determined in accordance with GAAP. These non-GAAP measures reflect management’s judgment of particular items and may not be comparable to similarly titled measures reported by other companies.