Supplemental Guarantor Condensed Consolidating Financial Statements (Tables)

3 Months Ended

Mar. 31, 2013

Supplemental Guarantor Condensed Consolidating Financial Statements

Schedule of Increase (decrease) from amounts previously reported

Increase (Decrease) from Amounts Previously Reported

	Three months ended March 31, 2012
(in millions)	FDC Parent Company		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidation Adjustments
(Loss) income before income taxes and equity earnings in affiliates	$	26.2	$	(56.4	)	$	(13.9	)	$	44.1
Income tax (benefit) expense	26.2		(20.9		)	(5.3		)	—
Net (loss) income	—		(35.5		)	(8.6		)	44.1
Net (loss) income attributable to First Data Corporation	—		(35.5		)	(8.6		)	44.1

Schedule of Previous and Corrected Disclosures

CONSOLIDATED STATEMENTS OF OPERATIONS

	Three months ended March 31, 2012
	FDC Parent Company						Guarantor Subsidiaries						Non-Guarantor Subsidiaries				Consolidation Adjustments
(in millions)	As previously reported			As corrected			As previously reported			As corrected			As previously reported		As corrected		As previously reported			As corrected
Cost of services	$	—		$	—		$	455.6		$	445.2		$	285.7	$	296.1	$	(45.9	)	$	(45.9	)
Selling, general and administrative	68.4			29.5			254.9			290.0			123.2		127.0		—			—
Operating (loss) profit	(70.6		)	(31.7		)	178.7			154.0			108.9		94.7		—			—
Interest income (expense) from intercompany notes	46.7			78.0			(48.2		)	(79.8		)	1.5		1.8		—			—
Equity earnings from consolidated subsidiaries	168.9			124.9			31.2			31.1			—		—		(200.1		)	(156.0		)
(Loss) income before income taxes and equity earnings in affiliates	(337.2		)	(311.0		)	160.4			104.0			127.1		113.2		(200.1		)	(156.0		)
Income tax (benefit) expense	(184.7		)	(158.5		)	65.9			45.0			10.6		5.3		—			—
Net (loss) income	(152.5		)	(152.5		)	121.8			86.3			116.7		108.1		(200.1		)	(156.0		)
Net (loss) income attributable to First Data Corporation	(152.5		)	(152.5		)	121.8			86.3			103.0		94.4		(224.8		)	(180.7		)

CONSOLIDATED BALANCE SHEETS

	As of December 31, 2012
	FDC Parent Company						Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Consolidation Adjustments
(in millions)	As previously reported			As corrected			As previously reported		As corrected		As previously reported		As corrected		As previously reported			As corrected
ASSETS
Long-term deferred tax assets	$	—		$	1,028.0		$	—	$	—	$	—	$	—	$	—		$	(1,028.0	)
Investment in consolidated subsidiaries		24,257.2			24,308.9			5,379.5		5,379.5		—		—		(29,636.7	)		(29,688.4	)
Total assets	29,022.7			30,102.4			31,796.9		31,796.9		17,148.8		17,148.8		(40,069.4		)	(41,149.1		)
LIABILITIES AND EQUITY
Long-term deferred tax liabilities	(1,079.7		)	—			1,512.7		1,445.1		76.5		92.4		—			(1,028.0		)
Total liabilities	29,621.2			30,700.9			11,013.1		10,945.5		5,003.6		5,019.5		(10,432.7		)	(11,460.7		)
First Data Corporation stockholder’s (deficit) equity	(598.5		)	(598.5		)	20,783.8		20,851.4		5,598.9		5,583.0		(26,382.7		)	(26,434.4		)
Total equity	(598.5		)	(598.5		)	20,783.8		20,851.4		12,077.8		12,061.9		(29,636.7		)	(29,688.4		)
Total liabilities and equity	29,022.7			30,102.4			31,796.9		31,796.9		17,148.8		17,148.8		(40,069.4		)	(41,149.1		)

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three months ended March 31, 2012
	FDC Parent Company						Guarantor Subsidiaries						Non-Guarantor Subsidiaries						Consolidation Adjustments
(in millions) Source/(use)	As previously reported			As corrected			As previously reported			As corrected			As previously reported			As corrected			As previously reported			As corrected
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$	(152.5	)	$	(152.5	)	$	121.8		$	86.3		$	116.7		$	108.1		$	(200.1	)	$	(156.0	)
Other non-cash and non-operating items, net	(161.0		)	(117.0		)	(90.7		)	(90.6		)	1.4			1.4			200.1			156.0
(Decrease) increase in cash resulting from changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions	(272.2		)	(246.0		)	15.1			(5.9		)	5.9			0.7			—			—
Net cash (used in) provided by operating activities	(558.0		)	(487.8		)	271.2			214.8			232.6			218.8			—			—
CASH FLOWS FROM FINANCING ACTIVITIES
Intercompany	281.7			211.5			(234.5		)	(178.1		)	(47.2		)	(33.4		)	—			—
Net cash provided by (used in) financing activities	381.9			311.7			(245.6		)	(189.2		)	(197.8		)	(184.0		)	66.7			66.7

Schedule of the results of operations

	Three months ended March 31, 2013
(in millions)	FDC Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidation Adjustments			Consolidated
Revenues:
Transaction and processing service fees	$	—		$	1,005.2		$	593.0		$	(54.5	)	$	1,543.7
Product sales and other	—			131.1			85.5			(14.2		)	202.4
Reimbursable debit network fees, postage and other	—			610.5			234.3			—			844.8
	—			1,746.8			912.8			(68.7		)	2,590.9
Expenses:
Cost of services (exclusive of items shown below)	—			485.9			287.3			(54.5		)	718.7
Cost of products sold	—			61.5			35.3			(14.2		)	82.6
Selling, general and administrative	26.5			307.7			129.1			—			463.3
Reimbursable debit network fees, postage and other	—			610.5			234.3			—			844.8
Depreciation and amortization	1.8			159.7			110.7			—			272.2
Other operating expenses:
Restructuring, net	12.4			1.8			4.0			—			18.2
	40.7			1,627.1			800.7			(68.7		)	2,399.8
Operating (loss) profit	(40.7		)	119.7			112.1			—			191.1
Interest income	0.1			—			2.6			—			2.7
Interest expense	(465.2		)	(1.6		)	(2.2		)	—			(469.0		)
Interest income (expense) from intercompany notes	78.5			(77.9		)	(0.6		)	—			—
Other income (expense)	18.6			1.1			(19.4		)	—			0.3
Equity earnings from consolidated subsidiaries	78.2			34.1			—			(112.3		)	—
	(289.8		)	(44.3		)	(19.6		)	(112.3		)	(466.0		)
(Loss) income before income taxes and equity earnings in affiliates	(330.5		)	75.4			92.5			(112.3		)	(274.9		)
Income tax expense	6.9			41.4			13.3			—			61.6
Equity earnings in affiliates	—			38.3			(0.6		)	—			37.7
Net (loss) income	(337.4		)	72.3			78.6			(112.3		)	(298.8		)
Less: Net income attributable to noncontrolling interests and redeemable noncontrolling interests	—			—			14.3			24.3			38.6
Net (loss) income attributable to First Data Corporation	$	(337.4	)	$	72.3		$	64.3		$	(136.6	)	$	(337.4	)
Comprehensive (loss) income	$	(413.9	)	$	73.6		$	16.0		$	(54.9	)	$	(379.2	)
Less: Comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interest	—			—			10.4			24.3			34.7
Comprehensive (loss) income attributable to First Data Corporation	$	(413.9	)	$	73.6		$	5.6		$	(79.2	)	$	(413.9	)

	Three months ended March 31, 2012 (As Corrected)
(in millions)	FDC Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidation Adjustments			Consolidated
Revenues:
Transaction and processing service fees	$	—		$	1,009.3		$	589.9		$	(45.9	)	$	1,553.3
Product sales and other	—			132.6			84.1			(13.3		)	203.4
Reimbursable debit network fees, postage and other	—			590.5			227.3			(10.5		)	807.3
	—			1,732.4			901.3			(69.7		)	2,564.0
Expenses:
Cost of services (exclusive of items shown below)	—			445.2			296.1			(45.9		)	695.4
Cost of products sold	—			64.7			33.6			(13.3		)	85.0
Selling, general and administrative	29.5			290.0			127.0			—			446.5
Reimbursable debit network fees, postage and other	—			590.5			227.3			(10.5		)	807.3
Depreciation and amortization	2.2			188.1			118.8			—			309.1
Other operating expenses:
Restructuring, net	—			(0.1		)	3.8			—			3.7
	31.7			1,578.4			806.6			(69.7		)	2,347.0
Operating (loss) profit	(31.7		)	154.0			94.7			—			217.0
Interest income	—			0.2			2.3			—			2.5
Interest expense	(456.7		)	(1.7		)	(2.7		)	—			(461.1		)
Interest income (expense) from intercompany notes	78.0			(79.8		)	1.8			—			—
Other income (expense)	(25.5		)	0.2			17.1			—			(8.2		)
Equity earnings from consolidated subsidiaries	124.9			31.1			—			(156.0		)	—
	(279.3		)	(50.0		)	18.5			(156.0		)	(466.8		)
(Loss) income before income taxes and equity earnings in affiliates	(311.0		)	104.0			113.2			(156.0		)	(249.8		)
Income tax (benefit) expense	(158.5		)	45.0			5.3			—			(108.2		)
Equity earnings in affiliates	—			27.3			0.2			—			27.5
Net (loss) income	(152.5		)	86.3			108.1			(156.0		)	(114.1		)
Less: Net income attributable to noncontrolling interests and redeemable noncontrolling interest	—			—			13.7			24.7			38.4
Net (loss) income attributable to First Data Corporation	$	(152.5	)	$	86.3		$	94.4		$	(180.7	)	$	(152.5	)
Comprehensive (loss) income	$	(44.3	)	$	92.3		$	191.0		$	(247.0	)	$	(8.0	)
Less: Comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interest	—			—			11.6			24.7			36.3
Comprehensive (loss) income attributable to First Data Corporation	$	(44.3	)	$	92.3		$	179.4		$	(271.7	)	$	(44.3	)

Schedule of the financial position

	As of March 31, 2013
(in millions)		FDC Parent Company			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidation Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents		$	33.5		$	43.2	$	357.6	$	—		$	434.3
Accounts receivable, net of allowance for doubtful accounts		0.5			837.9		853.4		—			1,691.8
Settlement assets (a)		—			9,159.5		7,323.1		(89.3		)	16,393.3
Intercompany notes receivable		—			—		31.1		(31.1		)	—
Other current assets		70.5			165.4		69.0		—			304.9
Total current assets		104.5			10,206.0		8,634.2		(120.4		)	18,824.3
Property and equipment, net of accumulated depreciation		29.9			545.0		251.9		—			826.8
Goodwill		—			9,464.6		7,749.7		—			17,214.3
Customer relationships, net of accumulated amortization		—			1,993.8		1,610.5		—			3,604.3
Other intangibles, net of accumulated amortization		605.2			599.1		588.3		—			1,792.6
Investment in affiliates		—			1,349.4		36.8		—			1,386.2
Long-term settlement assets (a)		—			—		33.5		—			33.5
Long-term intercompany receivables		—			5,662.6		1,203.8		(6,866.4		)	—
Long-term intercompany notes receivable		3,435.7			274.7		4.2		(3,714.6		)	—
Long-term deferred tax assets		905.1			—		—		(905.1		)	—
Other long-term assets		420.8			383.1		117.2		(94.5		)	826.6
Investment in consolidated subsidiaries		24,323.8			5,389.9		—		(29,713.7		)	—
Total assets		$	29,825.0		$	35,868.2	$	20,230.1	$	(41,414.7	)	$	44,508.6
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable		$	14.7		$	161.6	$	94.5	$	—		$	270.8
Short-term and current portion of long-term borrowings		15.4			50.8		104.6		—			170.8
Settlement obligations (a)		—			9,159.5		7,355.0		(89.3		)	16,425.2
Intercompany notes payable		31.1			—		—		(31.1		)	—
Other current liabilities		544.4			563.2		361.2		—			1,468.8
Total current liabilities		605.6			9,935.1		7,915.3		(120.4		)	18,335.6
Long-term borrowings		22,457.9			40.9		16.8		—			22,515.6
Long-term deferred tax liabilities		—			1,362.1		123.4		(905.1		)	580.4
Long-term intercompany payables		6,866.4			—		—		(6,866.4		)	—
Long-term intercompany notes payable		278.2			3,352.8		83.6		(3,714.6		)	—
Other long-term liabilities		640.4			227.6		37.0		(94.5		)	810.5
Total liabilities		30,848.5			14,918.5		8,176.1		(11,701.0		)	42,242.1
Redeemable equity interest		—			—		69.1		(69.1		)	—
Redeemable noncontrolling interest		—			—		—		69.1			69.1
First Data Corporation stockholder’s (deficit) equity		(1,023.5		)	20,949.7		5,513.8		(26,463.5		)	(1,023.5		)
Noncontrolling interests		—			—		72.3		3,148.6			3,220.9
Equity of consolidated alliance		—			—		6,398.8		(6,398.8		)	—
Total equity		(1,023.5		)	20,949.7		11,984.9		(29,713.7		)	2,197.4
Total liabilities and equity		$	29,825.0		$	35,868.2	$	20,230.1	$	(41,414.7	)	$	44,508.6

	As of December 31, 2012(As Corrected)
(in millions)	FDC ParentCompany			GuarantorSubsidiaries		Non-GuarantorSubsidiaries		ConsolidationAdjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	228.0		$	37.2	$	343.1	$	—		$	608.3
Accounts receivable, net of allowance for doubtful accounts	4.4			879.7		963.6		—			1,847.7
Settlement assets (a)	—			5,097.1		4,076.7		—			9,173.8
Intercompany notes receivable	—			—		30.8		(30.8		)	—
Other current assets	73.0			145.3		35.3		—			253.6
Total current assets	305.4			6,159.3		5,449.5		(30.8		)	11,883.4
Property and equipment, net of accumulated depreciation	30.7			561.4		263.7		—			855.8
Goodwill	—			9,485.3		7,797.2		—			17,282.5
Customer relationships, net of accumulated amortization	—			2,071.7		1,684.6		—			3,756.3
Other intangibles, net of accumulated amortization	605.0			619.7		603.9		—			1,828.6
Investment in affiliates	—			1,375.2		37.9		—			1,413.1
Long-term settlement assets (a)	—			—		54.3		—			54.3
Long-term intercompany receivables	—			5,501.3		1,141.1		(6,642.4		)	—
Long-term intercompany notes receivable	3,397.3			270.0		8.4		(3,675.7		)	—
Long-term deferred tax assets	1,028.0			—		—		(1,028.0		)	—
Other long-term assets	427.1			373.5		108.2		(83.8		)	825.0
Investment in consolidated subsidiaries	24,308.9			5,379.5		—		(29,688.4		)	—
Total assets	$	30,102.4		$	31,796.9	$	17,148.8	$	(41,149.1	)	$	37,899.0
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	13.8		$	141.8	$	105.3	$	—		$	260.9
Short-term and current portion of long-term borrowings	15.1			55.1		186.9		—			257.1
Settlement obligations (a)	—			5,097.1		4,129.2		—			9,226.3
Intercompany notes payable	30.8			—		—		(30.8		)	—
Other current liabilities	608.1			620.3		372.2		—			1,600.6
Total current liabilities	667.8			5,914.3		4,793.6		(30.8		)	11,344.9
Long-term borrowings	22,462.3			47.8		18.8		—			22,528.9
Long-term deferred tax liabilities	—			1,445.1		92.4		(1,028.0		)	509.5
Long-term intercompany payables	6,642.4			—		—		(6,642.4		)	—
Long-term intercompany notes payable	276.7			3,315.6		83.4		(3,675.7		)	—
Other long-term liabilities	651.7			222.7		31.3		(83.8		)	821.9
Total liabilities	30,700.9			10,945.5		5,019.5		(11,460.7		)	35,205.2
Redeemable equity interest	—			—		67.4		(67.4		)	—
Redeemable noncontrolling interest	—			—		—		67.4			67.4
First Data Corporation stockholder’s (deficit) equity	(598.5		)	20,851.4		5,583.0		(26,434.4		)	(598.5		)
Noncontrolling interests	—			—		70.5		3,154.4			3,224.9
Equity of consolidated alliance	—			—		6,408.4		(6,408.4		)	—
Total equity	(598.5		)	20,851.4		12,061.9		(29,688.4		)	2,626.4
Total liabilities and equity	$	30,102.4		$	31,796.9	$	17,148.8	$	(41,149.1	)	$	37,899.0

(a) The majority of the Guarantor settlement assets relate to FDC’s merchant acquiring business. FDC believes the settlement assets are not available to satisfy any claims other than those related to the settlement liabilities.

Schedule of the cash flows

	Three months ended March 31, 2013
(in millions)	FDC Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidation Adjustments			Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$	(337.4	)	$	72.3		$	78.6		$	(112.3	)	$	(298.8	)
Adjustments to reconcile to net cash (used in) provided by operating activities:
Depreciation and amortization (including amortization netted against equity earnings in affiliates and revenues)	1.8			185.9			114.4			—			302.1
(Gains) charges related to other operating expenses and other income (expense)	(6.2		)	0.7			23.4			—			17.9
Other non-cash and non-operating items, net	(61.1		)	(95.4		)	1.6			112.3			(42.6		)
(Decrease) increase in cash resulting from changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions	(54.5		)	77.4			67.7			—			90.6
Net cash (used in) provided by operating activities	(457.4		)	240.9			285.7			—			69.2
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property and equipment	(0.1		)	(23.7		)	(20.8		)	—			(44.6		)
Proceeds from sale of property and equipment	—			3.6			—			—			3.6
Payments to secure customer service contracts, including outlays for conversion, and capitalized systems development costs	(0.3		)	(37.4		)	(8.3		)	—			(46.0		)
Distributions and dividends from subsidiaries	39.1			31.1			—			(70.2		)	—
Other investing activities	0.3			1.2			0.9			—			2.4
Net cash provided by (used in) investing activities	39.0			(25.2		)	(28.2		)	(70.2		)	(84.6		)
CASH FLOWS FROM FINANCING ACTIVITIES
Short-term borrowings, net	—			—			(81.0		)	—			(81.0		)
Debt modification proceeds and related financing costs, net	3.5			—			—			—			3.5
Principal payments on long-term debt	(0.1		)	(16.1		)	(2.7		)	—			(18.9		)
Distributions and dividends paid to noncontrolling interests and redeemable noncontrolling interests	—			—			(8.8		)	(30.1		)	(38.9		)
Distributions paid to equity holders	—			—			(61.2		)	61.2			—
Redemption of Parent’s redeemable common stock	(4.8		)	—			—			—			(4.8		)
Cash dividends	(14.9		)	—			(39.1		)	39.1			(14.9		)
Intercompany	240.2			(199.0		)	(41.2		)	—			—
Net cash provided by (used in) financing activities	223.9			(215.1		)	(234.0		)	70.2			(155.0		)
Effect of exchange rate changes on cash and cash equivalents	—			5.4			(9.0		)	—			(3.6		)
Change in cash and cash equivalents	(194.5		)	6.0			14.5			—			(174.0		)
Cash and cash equivalents at beginning of period	228.0			37.2			343.1			—			608.3
Cash and cash equivalents at end of period	$	33.5		$	43.2		$	357.6		$	—		$	434.3

	Three months ended March 31, 2012(As Corrected)
(in millions)	FDC Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidation Adjustments			Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$	(152.5	)	$	86.3		$	108.1		$	(156.0	)	$	(114.1	)
Adjustments to reconcile to net cash (used in) provided by operating activities:
Depreciation and amortization (including amortization netted against equity earnings in affiliates and revenues)	2.2			225.3			121.9			—			349.4
Charges (gains) related to other operating expenses and other income (expense)	25.5			(0.3		)	(13.3		)	—			11.9
Other non-cash and non-operating items, net	(117.0		)	(90.6		)	1.4			156.0			(50.2		)
(Decrease) increase in cash resulting from changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions	(246.0		)	(5.9		)	0.7			—			(251.2		)
Net cash (used in) provided by operating activities	(487.8		)	214.8			218.8			—			(54.2		)
CASH FLOWS FROM INVESTING ACTIVITIES
Contributions to equity method investments	—			(7.9		)	—			—			(7.9		)
Payments related to other businesses previously acquired	—			(3.2		)	—			—			(3.2		)
Additions to property and equipment	(0.1		)	(30.0		)	(17.5		)	—			(47.6		)
Proceeds from sale of property and equipment	—			1.1			—			—			1.1
Payments to secure customer service contracts, including outlays for conversion, and capitalized systems development costs	(0.1		)	(45.3		)	(8.8		)	—			(54.2		)
Distributions and dividends from subsidiaries	20.0			46.7			—			(66.7		)	—
Other investing activities	0.4			0.2			0.3			—			0.9
Net cash provided by (used in) investing activities	20.2			(38.4		)	(26.0		)	(66.7		)	(110.9		)
CASH FLOWS FROM FINANCING ACTIVITIES
Short-term borrowings, net	79.0			—			(26.1		)	—			52.9
Accrued interest funded upon issuance of notes	16.9			—			—			—			16.9
Debt modification proceeds and related financing costs, net	8.0			—			—			—			8.0
Principal payments on long-term debt	(0.1		)	(11.1		)	(4.6		)	—			(15.8		)
Distributions and dividends paid to noncontrolling interests and redeemable noncontrolling interest	—			—			(9.9		)	(43.3		)	(53.2		)
Distributions paid to equity holders	—			—			(88.0		)	88.0			—
Redemption of Parent’s redeemable common stock	(0.1		)	—			—			—			(0.1		)
Cash dividends	(3.5		)	—			(22.0		)	22.0			(3.5		)
Intercompany	211.5			(178.1		)	(33.4		)	—			—
Net cash provided by (used in) financing activities	311.7			(189.2		)	(184.0		)	66.7			5.2
Effect of exchange rate changes on cash and cash equivalents	—			(3.8		)	7.2			—			3.4
Change in cash and cash equivalents	(155.9		)	(16.6		)	16.0			—			(156.5		)
Cash and cash equivalents at beginning of period	162.2			37.1			286.4			—			485.7
Cash and cash equivalents at end of period	$	6.3		$	20.5		$	302.4		$	—		$	329.2