10-Q 1 fis-10xq06x30x2014.htm 10-Q FIS-10-Q 06-30-2014
 
 
 
 
 
 
 
 
 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________________
Form 10-Q
_______________________________________________
x
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
 
For the quarterly period ended June 30, 2014
Or
o
 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
 
For the transition period from                      to
Commission File No. 001-16427
_______________________________________________
Fidelity National Information Services, Inc.
(Exact name of registrant as specified in its charter)
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)
(904) 438-6000
(Registrant’s telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES x NO o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES x NO o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer x
Accelerated filer o
Non-accelerated filer o
(Do not check if a smaller reporting company)
Smaller reporting company o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) YES o NO x
As of July 31, 2014, 285,418,355 shares of the Registrant’s Common Stock were outstanding.
 
 
 
 
 
 
 
 
 
 


FORM 10-Q
QUARTERLY REPORT
Quarter Ended June 30, 2014
INDEX
 
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
 


1



FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In millions, except per share amounts)
(Unaudited)
 
June 30, 2014
 
December 31, 2013
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
793.7

 
$
547.5

Settlement deposits
439.5

 
327.4

Trade receivables, net of allowance for doubtful accounts of $22.5 and $16.2 as of
June 30, 2014 and December 31, 2013, respectively
1,018.2

 
987.9

Settlement receivables
262.4

 
178.2

Other receivables
41.2

 
62.1

Due from related parties
38.2

 
35.8

Prepaid expenses and other current assets
167.7

 
154.1

Deferred income taxes
65.7

 
58.9

Assets held for sale
8.3

 
—

Total current assets
2,834.9

 
2,351.9

Property and equipment, net
459.0

 
439.0

Goodwill
8,517.7

 
8,500.0

Intangible assets, net
1,246.5

 
1,339.3

Computer software, net
869.7

 
856.5

Deferred contract costs, net
212.2

 
206.8

Other noncurrent assets
300.8

 
266.6

Total assets
$
14,440.8

 
$
13,960.1

LIABILITIES AND EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable and accrued liabilities
$
648.5

 
$
768.0

Settlement payables
730.7

 
518.6

Deferred revenues
276.0

 
243.6

Current portion of long-term debt
23.0

 
128.8

Due to Brazilian venture partner
20.1

 
13.7

Liabilities held for sale
3.0

 
—

Total current liabilities
1,701.3

 
1,672.7

Long-term debt, excluding current portion
4,900.5

 
4,339.8

Deferred income taxes
816.4

 
823.6

Due to Brazilian venture partner
32.7

 
34.5

Deferred revenues
28.2

 
27.2

Other long-term liabilities
261.6

 
325.0

Total liabilities
7,740.7

 
7,222.8

Equity:
 
 
 
FIS stockholders’ equity:
 
 
 
Preferred stock, $0.01 par value, 200 shares authorized, none issued and outstanding as of June 30, 2014 and December 31, 2013
—

 
—

Common stock, $0.01 par value, 600 shares authorized, 387.2 and 387.0 shares issued as of June 30, 2014 and December 31, 2013, respectively
3.9

 
3.9

Additional paid in capital
7,286.5

 
7,247.6

Retained earnings
2,538.0

 
2,341.9

Accumulated other comprehensive earnings (loss)
12.9

 
(9.9
)
Treasury stock, $0.01 par value, 101.9 and 96.4 shares as of June 30, 2014 and December 31, 2013, respectively, at cost
(3,319.2
)
 
(3,003.0
)
Total FIS stockholders’ equity
6,522.1

 
6,580.5

Noncontrolling interest
178.0

 
156.8

Total equity
6,700.1

 
6,737.3

Total liabilities and equity
$
14,440.8

 
$
13,960.1

See accompanying notes to unaudited condensed consolidated financial statements.

2

FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Earnings
(In millions, except per share data)
(Unaudited)

 
Three months ended
June 30,
 
Six months ended
June 30,
 
2014
 
2013
 
2014
 
2013
Processing and services revenues (for related party activity, see note 2)
$
1,599.1

 
$
1,512.8

 
$
3,119.4

 
$
2,990.1

Cost of revenues
1,092.8

 
1,031.5

 
2,140.4

 
2,040.9

Gross profit
506.3

 
481.3

 
979.0

 
949.2

Selling, general, and administrative expenses
196.6

 
232.6

 
383.2

 
424.7

Operating income
309.7

 
248.7

 
595.8

 
524.5

Other income (expense):
 
 
 
 
 
 
 
Interest expense, net
(41.9
)
 
(49.4
)
 
(83.0
)
 
(101.1
)
Other income (expense), net
(1.2
)
 
(61.9
)
 
(1.7
)
 
(56.8
)
Total other income (expense), net
(43.1
)
 
(111.3
)
 
(84.7
)
 
(157.9
)
Earnings from continuing operations before income taxes
266.6

 
137.4

 
511.1

 
366.6

Provision for income taxes
80.4

 
41.2

 
161.6

 
116.6

Earnings from continuing operations, net of tax
186.2

 
96.2

 
349.5

 
250.0

Earnings (loss) from discontinued operations, net of tax
(0.9
)
 
12.8

 
(3.1
)
 
8.4

Net earnings
185.3

 
109.0

 
346.4

 
258.4

Net (earnings) loss attributable to noncontrolling interest
(6.5
)
 
(4.2
)
 
(13.1
)
 
(9.5
)
Net earnings attributable to FIS common stockholders
$
178.8

 
$
104.8

 
$
333.3

 
$
248.9

Net earnings per share — basic from continuing operations attributable to FIS common stockholders
$
0.63

 
$
0.32

 
$
1.17

 
$
0.83

Net earnings (loss) per share — basic from discontinued operations attributable to FIS common stockholders
—

 
0.04

 
(0.01
)
 
0.03

Net earnings per share — basic attributable to FIS common stockholders *
$
0.63

 
$
0.36

 
$
1.16

 
$
0.86

Weighted average shares outstanding — basic
285.5

 
289.9

 
286.7

 
290.5

Net earnings per share — diluted from continuing operations attributable to FIS common stockholders
$
0.62

 
$
0.31

 
$
1.16

 
$
0.82

Net earnings (loss) per share — diluted from discontinued operations attributable to FIS common stockholders
—

 
0.04

 
(0.01
)
 
0.03

Net earnings per share — diluted attributable to FIS common stockholders *
$
0.62

 
$
0.36

 
$
1.15

 
$
0.84

Weighted average shares outstanding — diluted
289.2

 
294.3

 
290.5

 
294.8

Cash dividends paid per share
$
0.24

 
$
0.22

 
$
0.48

 
$
0.44

Amounts attributable to FIS common stockholders:
 
 
 
 
 
 
 
Earnings from continuing operations, net of tax
$
179.7

 
$
92.0

 
$
336.4

 
$
240.5

Earnings (loss) from discontinued operations, net of tax
(0.9
)
 
12.8

 
(3.1
)
 
8.4

Net earnings attributable to FIS common stockholders
$
178.8

 
$
104.8

 
$
333.3

 
$
248.9

* Amounts may not sum due to rounding.
See accompanying notes to unaudited condensed consolidated financial statements.

3


FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Comprehensive Earnings
(In millions)
(Unaudited)

 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
Net earnings
 
 
$
185.3

 
 
 
$
109.0

 
 
 
$
346.4

 
 
 
$
258.4

Other comprehensive earnings, before tax:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unrealized gain (loss) on investments and derivatives
$
(2.1
)
 
 
 
$
2.3

 
 
 
$
(3.0
)
 
 
 
$
1.1

 
 
Reclassification adjustment for (gains) losses included in net earnings
1.9

 
 
 
1.3

 
 
 
3.5

 
 
 
3.0

 
 
Unrealized gain (loss) on investments and derivatives, net
(0.2
)
 
 
 
3.6

 
 
 
0.5

 
 
 
4.1

 
 
Foreign currency translation adjustments
14.8

 
 
 
(46.5
)
 
 
 
33.0

 
 
 
(53.7
)
 
 
Other comprehensive earnings (loss), before tax:
14.6

 
 
 
(42.9
)
 
 
 
33.5

 
 
 
(49.6
)
 
 
Provision for income tax expense (benefit) related to items of other comprehensive earnings
0.9

 
 
 
(1.0
)
 
 
 
1.1

 
 
 
(0.2
)
 
 
Other comprehensive earnings (loss), net of tax
$
13.7

 
13.7

 
$
(41.9
)
 
(41.9
)
 
$
32.4

 
32.4

 
$
(49.4
)
 
(49.4
)
Comprehensive earnings:
 
 
199.0

 
 
 
67.1

 
 
 
378.8

 
 
 
209.0

Net (earnings) loss attributable to noncontrolling interest
 
 
(6.5
)
 
 
 
(4.2
)
 
 
 
(13.1
)
 
 
 
(9.5
)
Other comprehensive (earnings) losses attributable to noncontrolling interest
 
 
(4.0
)
 
 
 
10.6

 
 
 
(9.6
)
 
 
 
9.1

Comprehensive earnings attributable to FIS common stockholders
 
 
$
188.5

 
 
 
$
73.5

 
 
 
$
356.1

 
 
 
$
208.6


See accompanying notes to unaudited condensed consolidated financial statements.





4

FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
Condensed Consolidated Statement of Equity
Six months ended June 30, 2014
(In millions, except per share amounts)
(Unaudited)

 
 
 
 
 
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, 2013
387.0

 
(96.4
)
 
$
3.9

 
$
7,247.6

 
$
2,341.9

 
$
(9.9
)
 
$
(3,003.0
)
 
$
156.8

 
$
6,737.3

Issuance of restricted stock
0.2

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Exercise of stock options
—

 
0.7

 
—

 
(4.5
)
 
—

 
—

 
19.6

 
—

 
15.1

Treasury shares held for taxes due upon exercise of stock options
—

 
(0.2
)
 
—

 
—

 
—

 
—

 
(11.4
)
 
—

 
(11.4
)
Excess income tax benefit from exercise of stock options
—

 
—

 
—

 
10.1

 
—

 
—

 
—

 
—

 
10.1

Stock-based compensation
—

 
—

 
—

 
26.6

 
—

 
—

 
—

 
—

 
26.6

Cash dividends paid ($0.24 per share per quarter) and other distributions
—

 
—

 
—

 
—

 
(137.2
)
 
—

 
—

 
(1.5
)
 
(138.7
)
Purchases of treasury stock
—

 
(6.0
)
 
—

 
—

 
—

 
—

 
(325.5
)
 
—

 
(325.5
)
Other
—

 
—

 
—

 
6.7

 
—

 
—

 
1.1

 
—

 
7.8

Net earnings
—

 
—

 
—

 
—

 
333.3

 
—

 
—

 
13.1

 
346.4

Other comprehensive earnings, net of tax
—

 
—

 
—

 
—

 
—

 
22.8

 
—

 
9.6

 
32.4

Balances, June 30, 2014
387.2

 
(101.9
)
 
$
3.9

 
$
7,286.5

 
$
2,538.0

 
$
12.9

 
$
(3,319.2
)
 
$
178.0

 
$
6,700.1

See accompanying notes to unaudited condensed consolidated financial statements.


5

FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(In millions)
(Unaudited)
 
Six months ended
June 30,
 
2014
 
2013
Cash flows from operating activities:
 
 
 
Net earnings
$
346.4

 
$
258.4

Adjustment to reconcile net earnings to net cash provided by operating activities:
 
 
 
Depreciation and amortization
309.1

 
305.5

Amortization of debt issue costs
6.7

 
14.6

Gain on sale of assets
—

 
(26.8
)
Gain on mFoundry acquisition
—

 
(9.2
)
Stock-based compensation
26.6

 
26.4

Deferred income taxes
(19.0
)
 
(24.7
)
Excess income tax benefit from exercise of stock options
(10.1
)
 
(14.5
)
Other operating activities
(1.9
)
 
1.7

Net changes in assets and liabilities, net of effects from acquisitions and foreign currency:
 
 
 
Trade receivables
(22.4
)
 
(26.1
)
Settlement activity
15.8

 
(3.6
)
Prepaid expenses and other assets
(35.7
)
 
(60.7
)
Deferred contract costs
(40.4
)
 
(37.3
)
Deferred revenue
30.9

 
(26.0
)
Accounts payable, accrued liabilities, and other liabilities
(126.9
)
 
(12.9
)
Net cash provided by operating activities
479.1

 
364.8

 
 
 
 
Cash flows from investing activities:
 
 
 
Additions to property and equipment
(77.3
)
 
(59.5
)
Additions to computer software
(109.3
)
 
(97.5
)
Proceeds from sale of assets
—

 
26.8

Acquisitions, net of cash acquired, and equity investments
(29.0
)
 
(130.1
)
Other investing activities, net
9.3

 
(22.8
)
Net cash used in investing activities
(206.3
)
 
(283.1
)
 
 
 
 
Cash flows from financing activities:
 
 
 
Borrowings
4,430.1

 
7,151.6

Repayment of borrowings
(3,976.6
)
 
(6,776.0
)
Debt issuance costs
(6.6
)
 
(17.0
)
Excess income tax benefit from exercise of stock options
10.1

 
14.5

Proceeds from exercise of stock options
15.5

 
72.9

Treasury stock activity
(355.6
)
 
(230.8
)
Dividends paid
(137.9
)
 
(127.9
)
Other financing activities, net
(18.3
)
 
(11.8
)
Net cash (used in) provided by financing activities
(39.3
)
 
75.5

Effect of foreign currency exchange rate changes on cash
12.7

 
(21.7
)
Net increase in cash and cash equivalents
246.2

 
135.5

Cash and cash equivalents, beginning of period
547.5

 
517.6

Cash and cash equivalents, end of period
$
793.7

 
$
653.1

 
 
 
 
Supplemental cash flow information:
 
 
 
Cash paid for interest
$
79.6

 
$
112.9

Cash paid for income taxes
$
168.5

 
$
186.7

See accompanying notes to unaudited condensed consolidated financial statements.

6

FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


Unless stated otherwise or the context otherwise requires, all references to “FIS,” “we,” the “Company” or the “registrant” are to Fidelity National Information Services, Inc., a Georgia corporation, and its subsidiaries.

(1) 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, 2013. 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 2013 Condensed Consolidated Financial Statements (Unaudited) to conform to the classifications used in 2014.
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).

(2) Related Party Transactions

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. The Company recorded Brazilian Venture revenues of $72.2 million and $78.5 million during the three months and $139.2 million and $153.8 million during the six months ended June 30, 2014 and 2013, respectively, from Banco Bradesco relating to these services. Brazilian Venture revenues included $10.2 million and $21.9 million of unfavorable currency impact during the three and six months ended June 30, 2014, respectively resulting from a stronger U.S. Dollar in 2014, as compared to 2013.

(3) Net Earnings per Share
The basic weighted average shares and common stock equivalents for the three and six months ended June 30, 2014 and 2013 are computed using the treasury stock method.

7
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


The following table summarizes the earnings per share attributable to FIS common stockholders for the three and six months ended June 30, 2014 and 2013 (in millions, except per share amounts):
 
Three months ended
June 30,
 
Six months ended
June 30,
 
2014
 
2013
 
2014
 
2013
Earnings from continuing operations attributable to FIS, net of tax
$
179.7

 
$
92.0

 
$
336.4

 
$
240.5

Earnings (loss) from discontinued operations attributable to FIS, net of tax
(0.9
)
 
12.8

 
(3.1
)
 
8.4

Net earnings attributable to FIS common stockholders
$
178.8

 
$
104.8

 
$
333.3

 
$
248.9

Weighted average shares outstanding — basic
285.5

 
289.9

 
286.7

 
290.5

Plus: Common stock equivalent shares
3.7

 
4.4

 
3.8

 
4.3

Weighted average shares outstanding — diluted
289.2

 
294.3

 
290.5

 
294.8

Net earnings per share — basic from continuing operations attributable to FIS common stockholders
$
0.63

 
$
0.32

 
$
1.17

 
$
0.83

Net earnings (loss) per share — basic from discontinued operations attributable to FIS common stockholders
—

 
0.04

 
(0.01
)
 
0.03

Net earnings per share — basic attributable to FIS common stockholders *
$
0.63

 
$
0.36

 
$
1.16

 
$
0.86

Net earnings per share — diluted from continuing operations attributable to FIS common stockholders
$
0.62

 
$
0.31

 
$
1.16

 
$
0.82

Net earnings (loss) per share — diluted from discontinued operations attributable to FIS common stockholders
—

 
0.04

 
(0.01
)
 
0.03

Net earnings per share — diluted attributable to FIS common stockholders *
$
0.62

 
$
0.36

 
$
1.15

 
$
0.84

 
 
 
 
 
 
 
 
* Amounts may not sum due to rounding.
 
 
 
 
 
 
 
Options to purchase approximately 4.1 million and 0.1 million shares of our common stock for the three months and 4.1 million and 1.6 million shares for the six months ended June 30, 2014 and 2013, respectively, were not included in the computation of diluted earnings per share because they were anti-dilutive.

(4) Discontinued Operations

Certain operations are reported as discontinued in the Condensed Consolidated Statements of Earnings (Unaudited) for the three and six months ended June 30, 2014 and 2013.

China eCas Business Line

During the second quarter of 2014, the Company committed to a plan to sell our business operation that provides eCas core banking software solutions to small financial institutions in China because it did not align with our strategic plans. This line of business had revenues of $0.4 million and $(0.3) million for the three months and $0.4 million for both six-month periods ended June 30, 2014 and 2013, respectively. The discontinued China eCas business line had losses before taxes of $0.6 million and $1.0 million for the three months and $3.0 million and $1.8 million for the six months ended June 30, 2014 and 2013, respectively.

 Brazil Item Processing and Remittance Services Operations

During the third quarter of 2010, the Company decided to pursue strategic alternatives for Fidelity National Participacoes Ltda. (“Participacoes”). Participacoes' processing volume was transitioned to other vendors or back to its customers during the second quarter of 2011. There were no revenues for the 2014 and 2013 periods. Participacoes had expenses of $0.7 million and $4.7 million for the three months and $1.2 million and $10.7 million for the six months ended June 30, 2014 and 2013, respectively. As a result of the dismissal of employees related to the shut-down activities completed in 2011, the three-month and six-month periods ended June 30, 2013 included charges of $4.5 million and $9.2 million, respectively, to settle claims or

8
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


increase our provision for potential labor claims. Charges for the three-month and six-month periods ended June 30, 2014 were nominal. The shut-down activities involved the transfer and termination of approximately 2,600 employees. As of June 30, 2014, there were approximately 870 active labor claims. Former employees generally had up to two years from the date of termination to file labor claims, which extended through April 2013. Consequently, we have continued exposure on these active claims, which were not transferred with other assets and liabilities in the disposal. Our accrued liability for active labor claims, net of $15.4 million in court ordered deposits, is $22.7 million as of June 30, 2014. Any changes in the estimated liability related to these labor claims will be recorded as discontinued operations.
 
ClearPar

On January 1, 2010, FIS sold certain assets and liabilities constituting our ClearPar automated syndicated loan trade settlement business. Terms of the sale included an initial cash payment of $71.5 million at closing, with the potential for an additional earn-out payment calculated as a function of the business' 2012 operating results. In May 2013, we recorded in discontinued operations a gain of $26.8 million ($16.7 million, net of tax) upon final determination and receipt of the earn-out payment.

(5) Changes in Accumulated Other Comprehensive Earnings (Losses)

The following table shows accumulated other comprehensive earnings ("AOCE") by component, net of tax, for the six months ended June 30, 2014 (in millions):
 
 
 
 
Foreign
 
 
 
 
 
 
Interest Rate
 
Currency
 
 
 
 
 
 
Swap
 
Translation
 
 
 
 
 
 
Contracts
 
Adjustments
 
Other
 
Total
Balances, December 31, 2013
 
$
(2.4
)
 
$
(3.0
)
 
$
(4.5
)
 
$
(9.9
)
Other comprehensive gain/(loss) before reclassifications
 
(1.9
)
 
22.5

 
—

 
20.6

Amounts reclassified from AOCE
 
2.2

 
—

 
—

 
2.2

Net current period AOCE attributable to FIS
 
0.3

 
22.5

 
—

 
22.8

Balances, June 30, 2014
 
$
(2.1
)
 
$
19.5

 
$
(4.5
)
 
$
12.9


The amount reclassified from AOCE for interest rate swap contracts includes $3.5 million recorded as interest expense, reduced by a related $1.3 million provision for income taxes.

The table below summarizes our provision for income tax expense (benefit) related to items of other comprehensive earnings (in millions):

 
 
Three months ended June 30,
 
Six months ended June 30,
 
 
2014
 
2013
 
2014
 
2013
 
 
 
 
 
 
 
 
 
Unrealized gain (loss) on investments and derivatives
 
$
(0.1
)
 
$
1.3

 
$
0.2

 
$
1.5

Foreign currency translation adjustments
 
1.0

 
(2.3
)
 
0.9

 
(2.1
)
Other components of other comprehensive earnings (loss)
 
—

 
—

 
—

 
0.4

Provision for income tax expense (benefit) related to items of other comprehensive earnings
 
$
0.9

 
$
(1.0
)
 
$
1.1

 
$
(0.2
)

(6) Condensed Consolidated Financial Statement Details
The following table shows the Company’s condensed consolidated financial statement details as of June 30, 2014 and December 31, 2013 (in millions):

9
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)



 
June 30, 2014
 
December 31, 2013
 
Cost
 
Accumulated
depreciation and amortization
 
Net
 
Cost
 
Accumulated
depreciation and amortization
 
Net
Property and equipment
$
1,163.5

 
$
704.5

 
$
459.0

 
$
1,077.4

 
$
638.4

 
$
439.0

Intangible assets
$
2,762.6

 
$
1,516.1

 
$
1,246.5

 
$
2,807.6

 
$
1,468.3

 
$
1,339.3

Computer software
$
1,533.3

 
$
663.6

 
$
869.7

 
$
1,557.5

 
$
701.0

 
$
856.5

       
The Company entered into capital lease obligations of $0.9 million and $2.0 million during the six months ended June 30, 2014 and 2013, respectively. The assets are included in property and equipment and computer software and the remaining capital lease obligation is classified as long-term debt on our Condensed Consolidated Balance Sheet (Unaudited) as of June 30, 2014. Periodic payments are included in repayment of borrowings on the Condensed Consolidated Statements of Cash Flows (Unaudited).

Settlement Activity

Settlement deposits represent funds we hold that were drawn from our customers to facilitate our settlement activities and, as of June 30, 2014, included $100.0 million of short-term investments in certificates of deposit with original maturities of greater than 90 days. These certificates of deposit are Level 2 type securities in the fair-value hierarchy. Settlement payables consist of settlement deposits from customers, settlement payables to third parties and outstanding checks related to our settlement activities for which the right of offset does not exist or we do not intend to exercise our right of offset. Our accounting policy for such outstanding checks is to include them in settlement payables on the balance sheet and in operating cash flows on the statement of cash flows.
        
(7) Long-Term Debt
Long-term debt as of June 30, 2014 and December 31, 2013, consisted of the following (in millions):
 
June 30, 2014
 
December 31, 2013
Term Loans A-4, quarterly principal amortization (1)
$
1,300.0

 
$
1,962.5

Senior Notes due 2017, interest payable semi-annually at 1.450%
300.0

 
—

Senior Notes due 2018, interest payable semi-annually at 2.000%
250.0

 
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

 
1,000.0

Senior Notes due 2024, interest payable semi-annually at 3.875%
700.0

 
—

Revolving Loan (2)
156.0

 
29.0

Other
17.5

 
27.1

 
4,923.5

 
4,468.6

Current portion
(23.0
)
 
(128.8
)
Long-term debt, excluding current portion
$
4,900.5

 
$
4,339.8

__________________________________________
(1)
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, 2014, the weighted average interest rate on the Term Loans A-4 was 1.40%.
(2)
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, 2014, the applicable margin on the Revolving Loan, excluding facility fees and unused commitment fees, was 1.25%.

FIS is a party to a syndicated credit agreement (the "FIS Credit Agreement"), which as of June 30, 2014, provided total committed capital of $3,300.0 million comprised of: (1) a revolving credit facility in an aggregate maximum principal amount of $2,000.0 million maturing on March 30, 2017 (the "Revolving Loan"); and (2) term loans of $1,300.0 million maturing on March 30, 2017 (the "Term Loans A-4"). As of June 30, 2014, the outstanding principal balance of the Revolving Loan was

10
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


$156.0 million, with $1,843.2 million of borrowing capacity remaining thereunder (net of $0.8 million in outstanding letters of credit issued under the Revolving Loan).

In June 2014, FIS issued $1,000.0 million of new senior notes, including $300.0 million of Senior Notes due in 2017 that bear interest at 1.450% and $700.0 million of Senior Notes due in 2024 that bear interest at 3.875%. The proceeds were used to pay down a portion of the Term Loans A-4 and to temporarily reduce borrowings under the Revolving Loan until the 2020 Notes were callable.

On July 15, 2014, FIS called all $500.0 million principal amount of 2020 Notes, funded by borrowings under the Company's Revolving Loan and cash on hand. As a result of the redemption, FIS will incur a pre-tax charge upon extinguishment of approximately $35.0 million, consisting of the call premium and the write-off of associated previously capitalized debt issuance costs.

The obligations of FIS under the FIS Credit Agreement and under all of its outstanding senior notes rank equal in priority, are unsecured and are guaranteed by substantially all of the domestic subsidiaries of FIS. The FIS Credit Agreement and the senior notes remain subject to customary covenants, including, among others, limitations on the payment of dividends by FIS, and events of default.

The following table summarizes the mandatory principal payments pursuant to the FIS Credit Agreement and the senior notes' indentures as of June 30, 2014 (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:
 
Term Loan
 
2017
 
2018
 
2020
 
2022
 
2023
 
2024
 
 
 
A-4
 
Notes
 
Notes
 
Notes
 
Notes
 
Notes
 
Notes
 
Total
2014
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

2015
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

2016
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

2017
1,300.0

 
300.0

 
—

 
—

 
—

 
—

 
—

 
1,600.0

2018
—

 
—

 
250.0

 
—

 
—

 
—

 
—

 
250.0

Thereafter
—

 
—

 
—

 
500.0

 
700.0

 
1,000.0

 
700.0

 
2,900.0

Total
$
1,300.0

 
$
300.0

 
$
250.0

 
$
500.0

 
$
700.0

 
$
1,000.0

 
$
700.0

 
$
4,750.0


Voluntary prepayment of the Term Loans is generally permitted at any time without fee upon proper notice and subject to a minimum dollar requirement. In addition to scheduled principal payments, the Term Loans are (with certain exceptions) subject to mandatory prepayment upon the occurrence of certain events.

FIS may redeem some or all of the 2022 Notes on or before May 14, 2020 at a specified premium to par, and thereafter at par, as outlined in the indenture agreement. FIS may also redeem the 2017 Notes, 2018 Notes, 2023 Notes and the 2024 Notes at its option in whole or in part, at any time and from time to time, at a redemption price equal to the greater of 100% of the principal amount to be redeemed and a make-whole amount calculated as described in the related indenture in each case plus accrued and unpaid interest to, but excluding, the date of redemption; provided no make-whole amount will be paid for redemptions on the 2023 Notes and 2024 Notes during the three months prior to their maturity.

We monitor the financial stability of our counterparties on an ongoing basis. The lender commitments under the undrawn portions of the Revolving Loan are comprised of a diversified set of financial institutions, both domestic and international. The combined commitments of our top 10 revolving lenders comprise about 58% of our Revolving Loan. The failure of any single lender to perform its obligations under the Revolving Loan would not adversely impact our ability to fund operations. If the single largest lender were to default under the terms of the FIS Credit Agreement (impacting the capacity of the Revolving Loan), the maximum loss of available capacity on the undrawn portion of the Revolving Loan, as of June 30, 2014, would be approximately $126.8 million.

Debt issuance costs of $47.5 million, net of accumulated amortization, remain capitalized as of June 30, 2014, related to all of the above outstanding debt.


11
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


The fair value of the Company’s long-term debt is estimated to be approximately $62.7 million higher than the carrying value as of June 30, 2014. This estimate is based on quoted prices of our senior notes and trades of our other debt in close proximity to June 30, 2014, which are considered Level 2-type measurements. This estimate is subjective in nature and involves uncertainties and significant judgment in the interpretation of current market data. Therefore, the values presented are not necessarily indicative of amounts the Company could realize or settle currently.

As of June 30, 2014, 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):

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 3, 2014
 
February 1, 2017
 
400.0

 
1 Month LIBOR (1)
 
0.89
%
(2)
 
 
 
 
$
1,300.0

 
 
 
 

 
___________________________________
(1)
0.16% in effect as of June 30, 2014.
(2)
Does not include the applicable margin and facility fees paid to lenders on the Term Loans and Revolving Loan as described above.
We have designated these interest rate swaps as cash flow hedges and, as such, they are carried on the Condensed Consolidated Balance Sheets (Unaudited) at fair value with changes in fair value included in other comprehensive earnings, net of tax.

A summary of the fair value of the Company’s derivative instruments as of June 30, 2014 and December 31, 2013, is as follows (in millions):
 
June 30, 2014
 
December 31, 2013
 
Balance sheet location
 
Fair
value
 
Balance sheet location
 
Fair
value
Interest rate swap contracts
Accounts payable and accrued liabilities
 
$
0.9

 
Accounts payable and accrued liabilities
 
$
2.5

Interest rate swap contracts
Other long-term liabilities
 
$
3.2

 
Other long-term liabilities
 
$
1.9


In accordance with the authoritative guidance for fair value measurements, the inputs used to determine the estimated fair value of our interest rate swaps are Level 2-type measurements. We considered our own credit risk and the credit risk of the counterparties when determining the fair value of our interest rate swaps. Adjustments are made to these amounts and to accumulated other comprehensive earnings ("AOCE") within the Condensed Consolidated Statements of Comprehensive Earnings (Unaudited) and Condensed Consolidated Statements of Equity as the factors that impact fair value change, including current and projected interest rates, time to maturity and required cash transfers/settlements with our counterparties. Periodic actual and estimated settlements with counterparties are recorded to interest expense as a yield adjustment to effectively fix the otherwise variable rate interest expense associated with the Term and Revolving Loans for hedged notional amounts.

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, 2014 and 2013 is as follows (in millions):

12
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


 
 
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
 
2014
 
2013
 
AOCE into income
 
2014
 
2013
Interest rate swap contracts
 
$
(2.1
)
 
$
4.8

 
Interest expense
 
$
(1.9
)
 
$
(1.3
)

 
 
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
 
2014
 
2013
 
AOCE into income
 
2014
 
2013
Interest rate swap contracts
 
$
(3.2
)
 
$
4.8

 
Interest expense
 
$
(3.5
)
 
$
(3.0
)

Approximately $2.1 million of the balance in AOCE as of June 30, 2014, is expected to be reclassified into income over the next twelve months.
Our existing cash flow hedges are highly effective and there was no impact on earnings due to hedge ineffectiveness. It is our practice to execute such instruments with credit-worthy banks at the time of execution and not to enter into derivative financial instruments for speculative purposes. As of June 30, 2014, we believe that our interest rate swap counterparties will be able to fulfill their obligations under our agreements and we believe we will have debt outstanding through the various expiration dates of the swaps such that the forecasted transactions remain probable of occurring.

(8) Supplemental Guarantor Financial Information

The following supplemental financial information sets forth for FIS and its guarantor and non-guarantor subsidiaries: (a) the Condensed Consolidating Balance Sheets as of June 30, 2014 and December 31, 2013; (b) the Condensed Consolidating Statements of Earnings and Comprehensive Earnings for the three and six months ended June 30, 2014 and 2013; and (c) the Condensed Consolidating Statements of Cash Flows for the six months ended June 30, 2014 and 2013. Each guarantor subsidiary is 100% owned by FIS and all guarantees are full and unconditional as well as joint and several.

13
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


 
Condensed Consolidating Balance Sheets
 
June 30, 2014
 
 
 
Guarantor
 
Non-guarantor
 
 
 
 
 
FIS
 
subsidiaries
 
subsidiaries
 
Eliminations
 
Consolidated
 
(in millions)
Assets
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
30.0

 
$
264.5

 
$
499.2

 
$
—

 
$
793.7

Settlement deposits
—

 
439.5

 
—

 
—

 
439.5

Trade receivables, net
—

 
724.3

 
293.9

 
—

 
1,018.2

Investment in subsidiaries, intercompany and receivables from related parties
9,687.0

 
11,346.8

 
896.7

 
(21,892.3
)
 
38.2

Other current assets
15.3

 
305.4

 
224.6

 
—

 
545.3

Total current assets
9,732.3

 
13,080.5

 
1,914.4

 
(21,892.3
)
 
2,834.9

Property and equipment, net
5.9

 
320.3

 
132.8

 
—

 
459.0

Goodwill
—

 
7,212.7

 
1,305.0

 
—

 
8,517.7

Intangible assets, net
—

 
895.2

 
351.3

 
—

 
1,246.5

Computer software, net
38.1

 
662.2

 
169.4

 
—

 
869.7

Other noncurrent assets
65.6

 
331.1

 
116.3

 
—

 
513.0

Total assets
$
9,841.9

 
$
22,502.0

 
$
3,989.2

 
$
(21,892.3
)
 
$
14,440.8

Liabilities and Equity
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued liabilities
$
125.3

 
$
200.8

 
$
322.4

 
$
—

 
$
648.5

Settlement payables
—

 
566.2

 
164.5

 
—

 
730.7

Current portion of long-term debt
14.1

 
8.3

 
0.6

 
—

 
23.0

Deferred revenues
—

 
187.9

 
88.1

 
—

 
276.0

Other current liabilities
—

 
—

 
23.1

 
—

 
23.1

Total current liabilities
139.4

 
963.2

 
598.7

 
—

 
1,701.3

Deferred income taxes
—

 
767.7

 
48.7

 
—

 
816.4

Long-term debt, excluding current portion
4,895.3

 
5.0

 
0.2

 
—

 
4,900.5

Other long-term liabilities
6.4

 
94.0

 
222.1

 
—

 
322.5

Total liabilities
5,041.1

 
1,829.9

 
869.7

 
—

 
7,740.7

Total equity
4,800.8

 
20,672.1

 
3,119.5

 
(21,892.3
)
 
6,700.1

Total liabilities and equity
$
9,841.9

 
$
22,502.0

 
$
3,989.2

 
$
(21,892.3
)
 
$
14,440.8

 
Condensed Consolidating Balance Sheets
 
December 31, 2013
 
 
 
Guarantor
 
Non-guarantor
 
 
 
 
 
FIS
 
subsidiaries
 
subsidiaries
 
Eliminations
 
Consolidated
 
(in millions)
Assets
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
21.5

 
$
172.4

 
$
353.6

 
$
—

 
$
547.5

Settlement deposits
—

 
327.4

 
—

 
—

 
327.4

Trade receivables, net
—

 
709.4

 
278.5

 
—

 
987.9

Investment in subsidiaries, intercompany and receivables from related parties
9,305.8

 
10,846.7

 
1,083.5

 
(21,200.2
)
 
35.8

Other current assets
38.1

 
289.4

 
125.8

 
—

 
453.3

Total current assets
9,365.4

 
12,345.3

 
1,841.4

 
(21,200.2
)
 
2,351.9

Property and equipment, net
6.5

 
329.3

 
103.2

 
—

 
439.0

Goodwill
—

 
7,212.7

 
1,287.3

 
—

 
8,500.0

Intangible assets, net
—

 
993.2

 
346.1

 
—

 
1,339.3

Computer software, net
36.4

 
656.5

 
163.6

 
—

 
856.5

Other noncurrent assets
63.6

 
294.5

 
115.3

 
—

 
473.4

Total assets
$
9,471.9

 
$
21,831.5

 
$
3,856.9

 
$
(21,200.2
)
 
$
13,960.1

Liabilities and Equity
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable and accrued liabilities
$
184.7

 
$
229.2

 
$
354.1

 
$
—

 
$
768.0

Settlement payables
—

 
453.0

 
65.6

 
—

 
518.6

Current portion of long-term debt
114.1

 
13.3

 
1.4

 
—

 
128.8

Deferred revenues
—

 
172.4

 
71.2

 
—

 
243.6

Other current liabilites
—

 
—

 
13.7

 
—

 
13.7

Total current liabilities
298.8

 
867.9

 
506.0

 
—

 
1,672.7

Deferred income taxes
—

 
778.8

 
44.8

 
—

 
823.6

Long-term debt, excluding current portion
4,333.2

 
6.3

 
0.3

 
—

 
4,339.8

Other long-term liabilities
2.8

 
98.8

 
285.1

 
—

 
386.7

Total liabilities
4,634.8

 
1,751.8

 
836.2

 
—

 
7,222.8

Total equity
4,837.1

 
20,079.7

 
3,020.7

 
(21,200.2
)
 
6,737.3

Total liabilities and equity
$
9,471.9

 
$
21,831.5

 
$
3,856.9

 
$
(21,200.2
)
 
$
13,960.1


14
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)



 
Condensed Consolidating Statements of Earnings and Comprehensive Earnings
 
Three months ended June 30, 2014
 
 
 
Guarantor
 
Non-guarantor
 
 
 
 
 
FIS
 
subsidiaries
 
subsidiaries
 
Eliminations
 
Consolidated
 
(in millions)
Processing and services revenues
$
—

 
$
1,221.2

 
$
377.9

 
$
—

 
$
1,599.1

Operating expenses
53.6

 
922.8

 
313.0

 
—

 
1,289.4

Operating income
(53.6
)
 
298.4

 
64.9

 
—

 
309.7

Other income (expense):
 
 
 
 
 
 
 
 
 
Interest expense, net
(43.4
)
 
(0.4
)
 
1.9

 
—

 
(41.9
)
Other income (expense)
0.7

 
(2.0
)
 
0.1

 
—

 
(1.2
)
Net earnings (loss) of equity affiliates
255.4

 
—

 
—

 
(255.4
)
 
—

Total other income (expense)
212.7

 
(2.4
)
 
2.0

 
(255.4
)
 
(43.1
)
Earnings (loss) from continuing operations before income taxes
159.1

 
296.0

 
66.9

 
(255.4
)
 
266.6

Provision (benefit) for income taxes
(27.1
)
 
83.2

 
24.3

 
—

 
80.4

Net earnings (loss) from continuing operations
186.2

 
212.8

 
42.6

 
(255.4
)
 
186.2

Earnings (loss) from discontinued operations, net of tax
(0.9
)
 
—

 
(0.9
)
 
0.9

 
(0.9
)
Net earnings (loss)
185.3

 
212.8

 
41.7

 
(254.5
)
 
185.3

Net (earnings) loss attributable to noncontrolling interest
(6.5
)
 
(0.2
)
 
(6.3
)
 
6.5

 
(6.5
)
Net earnings (loss) attributable to FIS common stockholders
$
178.8

 
$
212.6

 
$
35.4

 
$
(248.0
)
 
$
178.8

Comprehensive earnings (loss) attributable to FIS
$
188.5

 
$
212.2

 
$
46.1

 
$
(258.3
)
 
$
188.5



 
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

 
$
332.0

 
$
—

 
$
1,512.8

Operating expenses
56.6

 
876.0

 
331.5

 
—

 
1,264.1

Operating income
(56.6
)
 
304.8

 
0.5

 
—

 
248.7

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
213.7

 
—

 
—

 
(213.7
)
 
—

Total other income (expense)
101.8

 
2.7

 
(2.1
)
 
(213.7
)
 
(111.3
)
Earnings (loss) from continuing operations before income taxes
45.2

 
307.5

 
(1.6
)
 
(213.7
)
 
137.4

Provision (benefit) for income taxes
(51.0
)
 
92.9

 
(0.7
)
 
—

 
41.2

Net earnings (loss) from continuing operations
96.2

 
214.6

 
(0.9
)
 
(213.7
)
 
96.2

Earnings (loss) from discontinued operations, net of tax
12.8

 
—

 
(3.9
)
 
3.9

 
12.8

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







15
FIDELITY NATIONAL INFORMATION SERVICES, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


 
Condensed Consolidating Statements of Earnings and Comprehensive Earnings
 
Six months ended June 30, 2014
 
 
 
Guarantor
 
Non-guarantor
 
 
 
 
 
FIS
 
subsidiaries
 
subsidiaries
 
Eliminations
 
Consolidated
 
(in millions)
Processing and services revenues
$
—

 
$
2,395.7

 
$
723.7

 
$
—

 
$
3,119.4

Operating expenses
100.9

 
1,818.1

 
604.6

 
—

 
2,523.6

Operating income
(100.9
)
 
577.6

 
119.1

 
—

 
595.8

Other income (expense):
 
 
 
 
 
 
 
 
 
Interest expense, net
(86.2
)
 
(1.0
)
 
4.2

 
—

 
(83.0
)
Other income (expense)
0.4

 
(2.4
)