Fiserv (FISV) Q4 2002 earnings summary

Executive summary

• FY02 processing and services revenue rose 18% to $2.278B; operating income increased 25% to $443.0M and net income rose 28% to $266.1M.

• Q4 revenue was $591.1M, operating income $113.8M, net income $68.2M and diluted EPS $0.35.

• Growth reflected acquisitions, new-client wins, existing-client expansion, cross-selling and price increases; internal revenue growth was ~4% in FY02 after stated exclusions.

Financial highlights

• FY02 processing and services revenue $2.278B vs. $1.927B in FY01; total revenue, including customer reimbursements, was $2.569B.

• FY02 operating income $443.0M vs. $353.7M; net income $266.1M vs. $208.2M; diluted EPS $1.37 vs. $1.09.

• Diluted EPS excluding realized investment gains was $1.36 in FY02 vs. $1.07 in FY01; FY02 realized gain was $2.4M pre-tax.

• Operating cash flow was $576.8M; cash and equivalents ended FY02 at $227.2M, up $91.2M YoY.

Outlook and guidance

• FY03 effective tax rate expected to remain at 39%.

• Expected to renew the $143.3M 364-day credit agreement before its Q2 2003 expiration; management expected operating cash flow and available funds to cover operating needs, debt repayments and ordinary capital spending.

• Management planned to pursue complementary acquisitions and continue reducing acquisition-related costs through gradual elimination of operating redundancies.