Fidelity National Information Services (FIS) Reports Decrease in Earnings

FIS, a global leader in financial services technology, has reported its fourth quarter and full-year 2023 results, as well as introduced its 2024 outlook. The company's fourth quarter GAAP diluted earnings per share (EPS) for continuing operations was $0.11, with adjusted EPS of $0.94. For the full year 2023, GAAP diluted EPS for continuing operations was $0.85, and adjusted EPS was $3.37. This represents a decrease in adjusted EPS of 4% for the fourth quarter and 11% for the full year, compared to the prior year.

In terms of revenue, FIS saw a 1% decrease on a GAAP basis for the fourth quarter, with flat adjusted revenue compared to the prior year period. For the full year 2023, FIS reported a 1% increase in GAAP revenue and a 3% increase in adjusted revenue compared to the prior year.

The company also announced an increase in its share repurchase goal, aiming to repurchase at least $4.0 billion of shares by the end of 2024, up from the previous goal of at least $3.5 billion. Additionally, FIS approved a regular quarterly dividend of $0.36 per common share, payable on March 22, 2024.

Looking ahead, FIS is projecting accelerated revenue growth, expanding adjusted EBITDA margins, and year-over-year adjusted EPS growth for the full-year 2024. The adjusted EPS outlook reflects 2 months of contribution from an equity method investment in the first quarter and 11 months for the full year.

FIS' 45% ownership of the Worldpay merchant solutions business will be reported under the "equity method investment earnings (loss)" line of the income statement beginning in the first quarter of 2024.

The company's balance sheet and cash flows show that debt outstanding totaled $19.1 billion as of December 31, 2023. For the fourth quarter, net cash provided by operating activities was $1.5 billion, with free cash flow of approximately $1.1 billion. For the full year, net cash provided by operating activities was $4.3 billion, with free cash flow of approximately $3.6 billion.

FIS also highlighted its future forward outperformance, achieving annualized run-rate future forward cash savings of over $550 million exiting the quarter, including over $370 million of operational expense savings and approximately $180 million of capital expense savings.

In summary, while FIS reported decreases in adjusted EPS compared to the prior year for both the fourth quarter and full year 2023, the company is focusing on increasing its share repurchase goal, projecting growth for 2024, and highlighting its future forward operational expense savings.

The market has reacted to these announcements by moving the company's shares 4.7% to a price of $67.33. For more information, read the company's full 8-K submission here.

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