TIDMWPY
RNS Number : 8020G
Worldpay, Inc
08 November 2018
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH
JURISDICTION
FOR IMMEDIATE RELEASE
November 8, 2018
Worldpay Reports Third Quarter 2018 Results
Accelerating Organic Revenue Growth and Expanding Margins
Generated Strong Financial Results
CINCINNATI and LONDON, November 8, 2018 - Worldpay, Inc. (NYSE:
WP, LSE: WPY) ("Worldpay" or the "Company") today announced
financial results for the third quarter ended September 30, 2018.
Worldpay, Inc. was formed on January 16, 2018 through Vantiv,
Inc.'s previously announced acquisition of Worldpay Group plc. Net
revenue for Worldpay, Inc. increased 84% to $1,017.9 million as
compared to $554.2 million in Vantiv Inc.'s prior year period. Had
the Vantiv Inc./Worldpay Group plc transaction closed on January 1,
2017, net revenue would have increased by 9% on a pro forma basis
as compared to the prior year period. On a GAAP basis, net income
per diluted share attributable to Worldpay, Inc. decreased 98% to
$0.01 as compared to $0.57 in the prior year period. The GAAP
decrease is primarily due to transition, acquisition and
integration costs and intangible amortization incurred in
connection with the Vantiv, Inc./Worldpay Group plc transaction.
Adjusted net income per share increased 17% to $1.05 as compared to
$0.90 in the prior year period. (See Schedule 1 for net income per
diluted share attributable to Worldpay, Inc. and Schedule 2 for
adjusted net income per share.)
"I am excited about the momentum that we are building in the
marketplace as the newly combined Worldpay," said Charles Drucker,
chairman and co-chief executive officer of Worldpay. "We are
winning because we offer our clients a powerful value proposition
that includes a unique combination of global reach, innovative
technologies, and tailored solutions that differentiates us from
our competitors."
Worldpay, Inc. Third Quarter 2018 Results
(unaudited)
(in millions, except share data)
Three Months Ended
Pro Forma
September Pro Forma (2) Constant
September 30, 2017 (2) % Currency
30, 2018 (1) % Change Change % Change
--------------- -------------- --------- ---------- --------------
Net revenue $ 1,017.9 $ 554.2 84% 9% 9%
Technology Solutions 419.7 224.7 87% 17% 17%
Merchant Solutions 507.5 244.1 108% 4% 4%
Issuer Solutions 90.7 85.4 6% 4% 4%
Adjusted EBITDA $ 496.8 270.1 84%
Adj. EBITDA Margin 48.8% 48.7%
GAAP Net income attributable
to Worldpay, Inc. $ 2.8 $ 92.1 (97)%
GAAP Net income per diluted
share attributable to Worldpay,
Inc. $ 0.01 $ 0.57 (98)%
Adjusted net income $ 330.8 $ 168.0 97%
Adjusted net income per share $ 1.05 $ 0.90 17%
(1) 2017 actuals include Vantiv, Inc. results only.
(2) Illustrates what the combined results would have been had
the Vantiv, Inc./Worldpay Group plc transaction closed on January
1, 2017.
Adjusted EBITDA
Adjusted EBITDA was $496.8 million or 48.8% of net revenue in
the third quarter, representing 10 basis points of margin expansion
as compared to Vantiv, Inc. results on a stand-alone basis in the
prior year period. Had the Vantiv, Inc./Worldpay Group plc
transaction closed on January 1, 2017, Adjusted EBITDA margins
would have expanded by 150 basis points on a pro forma basis over
the prior year period.
Worldpay, Inc. Fourth Quarter and Full-Year Financial Outlook
(in millions, except share data)
Fourth Quarter Financial
Outlook Full Year Financial Outlook
------------------------------
Three Months Ended December
31, Year Ended December 31,
2017 Actual 2018 Outlook 2017 Actual
2018 Outlook (2) (1) (2)
---------------- ------------ ---------------- ------------
Net revenue $1,027 - $1,055 $569 $3,900 - $3,930 $2,123
GAAP Net income (loss)
per diluted share attributable ($0.25) -
to Worldpay, Inc. $0.06 - $0.20 $(0.37) ($0.09) $0.80
Adjusted net income per
share $1.05 - $1.10 $0.97 $3.95 - $4.00 $3.37
(1) Combined company guidance excludes Worldpay Group plc net
revenue and EPS contribution for the period from January 1, 2018 -
January 15, 2018, prior to the completion of its previously
announced acquisition by Vantiv, Inc. on January 16, 2018. Combined
company guidance is based on an assumed exchange rate of U.S.
dollar/pound sterling of $1.31.
(2) 2017 actuals include Vantiv, Inc. results only.
ASC 606
Worldpay adopted Accounting Standards Codification Topic 606,
Revenue from Contracts with Customers ("ASC 606"), effective
January 1, 2018. Under ASC 606, Network fees and other costs are
now netted against Revenue and no longer appear as an expense
between Revenue and Net revenue as they were shown in prior
periods. As a result, Revenue and Net revenue are now equivalent.
This change in presentation reduces Revenue by the amount of
Network fees and other costs to an amount equivalent to Net
revenue, but has no impact on Net income, Adjusted net income, or
Adjusted EBITDA.
Earnings Conference Call and Audio Webcast
The Company will host a conference call to discuss the third
quarter 2018 financial results today at 8:00 a.m. ET. The
conference call can be accessed live over the phone in the U.S. and
Canada by dialing (866) 548-4713, in the U.K. by dialing 0800 358
6377, or for international callers +1 (323) 794-2093, and
referencing code 5170010#. A replay will be available approximately
two hours after the call concludes and can be accessed for the U.S.
and Canada by dialing (888) 203-1112, in the U.K. by dialing 0808
101 1153, or for international callers +1 (719) 457-0820, and
entering replay passcode 5170010#. The call will also be webcast
live from the Company's investor relations website at
http://investor.worldpay.com. Following completion of the call, a
recorded replay of the webcast will be available on the
website.
About Worldpay, Inc.
Worldpay, Inc. (NYSE: WP; LSE: WPY) is a leading payments
technology company with unique capability to power global
omni-commerce. With an integrated technology platform, Worldpay
offers a comprehensive suite of products and services, delivered
globally through a single provider. Worldpay processes over 40
billion transactions annually, supporting more than 300 payment
types across 146 countries and 126 currencies. The company is
focused on expanding into high-growth markets and customer
segments, including global eCommerce, integrated payments and B2B.
Visit us at www.worldpay.com.
Non-GAAP and Pro Forma Financial Measures
This earnings release presents non-GAAP and pro forma financial
information including adjusted EBITDA, Underlying EBITDA, adjusted
net income, and adjusted net income per share. These are important
financial performance measures for the Company, but are not
financial measures as defined by GAAP. The presentation of this
financial information is not intended to be considered in isolation
of or as a substitute for, or superior to, the financial
information prepared and presented in accordance with GAAP. The
Company uses these non-GAAP and adjusted financial performance
measures for financial and operational decision making and as a
means to evaluate period-to-period comparisons. The Company
believes that they provide useful information about operating
results, enhance the overall understanding of past financial
performance and future prospects, and allow for greater
transparency with respect to key metrics used by management in its
financial and operational decision making. Reconciliations of these
measures to the most directly comparable GAAP financial measures
are presented in the attached schedules.
Forward-Looking Statements
This release contains forward-looking statements that are
subject to risks and uncertainties. All statements other than
statements of historical fact or relating to present facts or
current conditions included in this release are forward-looking
statements including any statements regarding guidance and
statements of a general economic or industry specific nature.
Forward-looking statements give our current expectations and
projections relating to our financial condition, results of
operations, guidance, plans, objectives, future performance and
business. You can identify forward-looking statements by the fact
that they do not relate strictly to historical or current facts.
These statements may include words such as "anticipate,"
"estimate," "expect," "project," "plan," "intend," "believe,"
"may," "should," "can have," "likely" and other words and terms of
similar meaning in connection with any discussion of the timing or
nature of future operating or financial performance or other
events.
The forward-looking statements contained in this release are
based on assumptions that we have made in light of our industry
experience and our perceptions of historical trends, current
conditions, expected future developments and other factors we
believe are appropriate under the circumstances. As you review and
consider information presented herein, you should understand that
these statements are not guarantees of future performance or
results. They depend upon future events and are subject to risks,
uncertainties (many of which are beyond our control) and
assumptions. Although we believe that these forward-looking
statements are based on reasonable assumptions, you should be aware
that many factors could affect our actual future performance or
results and cause them to differ materially from those anticipated
in the forward-looking statements. Certain of these factors and
other risks are discussed in the company's filings with the U.S.
Securities and Exchange Commission (the "SEC") and include, but are
not limited to: (i) our ability to adapt to developments and change
in our industry; (ii) competition; (iii) unauthorized disclosure of
data or security breaches; (iv) systems failures or interruptions;
(v) our ability to expand our market share or enter new markets;
(vi) our ability to successfully integrate the businesses of our
predecessor companies; (vii) our ability to identify and complete
acquisitions, joint ventures and partnerships; (viii) failure to
comply with applicable requirements of Visa, MasterCard or other
payment networks or changes in those requirements; (ix) our ability
to pass along fee increases; (x) termination of sponsorship or
clearing services; (xi) loss of clients or referral partners; (xii)
reductions in overall consumer, business and government spending;
(xiii) fraud by merchants or others; (xiv) a decline in the use of
credit, debit or prepaid cards; (xv) consolidation in the banking
and retail industries; (xvi) changes in foreign currency exchange
rates; (xvii) the effects of governmental regulation or changes in
laws; (xviii) geopolitical, regulatory, tax and business risks
associated with our international operations; and (xix) outcomes of
future litigation or investigations and our dual-listings with the
NYSE and LSE. Should one or more of these risks or uncertainties
materialize, or should any of these assumptions prove incorrect,
our actual results may vary in material respects from those
projected in these forward-looking statements. More information on
potential factors that could affect the company's financial results
and performance is included from time to time in the "Risk Factors"
and "Management's Discussion and Analysis of Financial Condition
and Results of Operations" sections of the company's periodic
reports filed with the SEC, including the company's most recently
filed Annual Report on Form 10-K and its subsequent filings with
the SEC.
Any forward-looking statement made by us in this release speaks
only as of the date of this release. Factors or events that could
cause our actual results to differ may emerge from time to time,
and it is not possible for us to predict all of them. We undertake
no obligation to publicly update any forward-looking statement,
whether as a result of new information, future developments or
otherwise, except as may be required by law.
CONTACTS
Investors
Nathan Rozof, CFA or Ignatius Njoku
Investor Relations
+1 (866) 254-4811
(513) 900-4811
IR@worldpay.com
Media
Andrew Ciafardini
Corporate Communications
+1 (513) 900-5308
Andrew.Ciafardini@worldpay.com
Schedule 1
Worldpay, Inc.
Consolidated Statements of Income
(Unaudited)
(in millions, except share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2018 2017 Change 2018 2017 Change
-------------- -------------- -------------- -------------- ---------
Revenue $ 1,017.9 $ 1,033.7 (2)% $ 2,875.4 $ 2,960.6 (3)%
Network fees and
other
costs - 479.5 NM - 1,406.3 NM
------------- ------------- ------------- -------------
Net Revenue(1) 1,017.9 554.2 84% 2,875.4 1,554.3 85%
Sales and
marketing 295.8 173.8 70% 845.2 497.1 70%
Other operating
costs 174.8 79.4 120% 515.4 234.3 120%
General and
administrative 140.7 49.6 184% 527.6 189.6 178%
Depreciation and
amortization 328.9 82.5 299% 824.0 237.0 248%
------------- ------------- ------------- -------------
Income from
operations 77.7 168.9 (54)% 163.2 396.3 (59)%
Interest
expense-net (75.2) (38.5) 95% (230.3) (97.4) 136%
Non-operating
(expense)
income(2) (3.5) 21.2 (117)% (34.1) 13.7 (349)%
------------- ------------- ------------- -------------
(Loss) income
before
applicable
income taxes (1.0) 151.6 (101)% (101.2) 312.6 (132)%
Income tax
(benefit)
expense (4.6) 44.7 (110)% (5.0) 83.5 (106)%
------------- ------------- ------------- -------------
Net income
(loss) 3.6 106.9 (97)% (96.2) 229.1 (142)%
Less: Net income
attributable
to
non-controlling
interests (0.8) (14.8) (95)% (1.5) (39.3) (96)%
------------- ------------- ------------- -------------
Net income
(loss)
attributable
to Worldpay,
Inc. $ 2.8 $ 92.1 (97)% $ (97.7) $ 189.8 (151)%
========= ========= ========= =========
Net income
(loss) per
share
attributable to
Worldpay, Inc.
Class A
common stock:
Basic $ 0.01 $ 0.57 (98)% $ (0.34) $ 1.18 (129)%
Diluted(3) $ 0.01 $ 0.57 (98)% $ (0.34) $ 1.17 (129)%
Shares used in
computing
net income
(loss) per
share of Class A
common
stock:
Basic 301,240,681 161,465,849 290,385,855 161,205,066
Diluted 313,881,826 162,882,396 290,385,855 162,617,782
(1) Based on the Company's adoption of Accounting Standard
Update 2014-09, Revenue From Contracts With Customers (Topic 606)
("ASC 606") effective January 1, 2018, Network fees and other costs
are now netted against Revenue. For the three and nine months ended
September 30, 2018, Revenue is equivalent to Net revenue as a
result of the company's adoption of ASC 606. For the three and nine
months ended September 30, 2017, Net revenue is equivalent to
Revenue less Network fees and other costs.
(2) Non-operating expense during the nine months ended September
30, 2018 primarily consists of expenses relating to the Company's
financing arrangements entered into in connection with the Worldpay
Group plc acquisition, repricing of the Company's debt in June 2018
and the change in fair value of the Mercury tax receivable
agreement ("TRA"), partially offset by a gain on the settlement of
a deal contingent forward entered into in connection with the
Company's acquisition of Worldpay Group plc. Non-operating income
for the nine months ended September 30, 2017 primarily consists of
an unrealized gain relating to the change in the fair value of a
deal contingent forward entered into in connection with the
Worldpay Group plc acquisition, partially offset by the change in
fair value of the Mercury TRA.
(3) Due to our structure as a C corporation and Worldpay
Holding's structure as a pass-through entity for tax purposes, the
numerator in the diluted net income per share calculation is
adjusted to reflect the Company's income tax expense at an expected
effective tax rate assuming the conversion of the Class B units of
Worldpay Holding into shares of our Class A common stock. During
the nine months ended September 30, 2018, approximately 13.5
million weighted average Class B units of Worldpay Holding were
excluded in computing diluted net income per share because
including them would have an antidilutive effect. Additionally,
during the three and nine months ended September 30, 2017,
approximately 23.6 million and 31.2 million weighted-average
dilutive Class B units of Worldpay Holding were excluded in
computing diluted net income per share because including them would
have an antidilutive effect. As the Class B units of Worldpay
Holding were not included, the numerator used in the calculation of
diluted net income per share was equal to the numerator used in the
calculation of basic net income per share for the nine months ended
September 30, 2018 and for the three and nine months ended
September 30, 2017. Additionally, due to the net loss for the nine
months ended September 30, 2018, any remaining potentially dilutive
securities were also excluded from the denominator in computing
dilutive net income per share.
Three Months Ended Nine Months Ended
September 30, September 30,
2018 2017 2018 2017
---------------- ------------- -------------- ---------------
(Loss) income before applicable
income taxes $ (1.0) $ - $ - $ -
Taxes (3.6) - - -
---------------
Net income (loss) $ 2.6 $ 92.1 $ (97.7) $ 189.8
Diluted shares 313,881,826 162,882,396 290,385,855 162,617,782
Diluted EPS $ 0.01 $ 0.57 $ (0.34) $ 1.17
Schedule 2
Worldpay, Inc.
Adjusted Net Income
(Unaudited)
(in millions, except share data)
Three Months Ended Nine Months Ended
September September September September
30, 30, 30, 30,
2018 2017 % Change 2018 2017 % Change
----------------- ----------------- ----------- ----------------- ----------------- -----------
Net (loss) income
before applicable
income taxes $ (1.0) $ 151.6 (101)% $ (101.2) $ 312.6 (132)%
Non-GAAP
Adjustments:
Transition,
acquisition
and integration
costs(1)
(2) 47.4 5.1 829% 277.6 67.9 309%
Share-based
compensation(2) 42.8 13.6 215% 99.0 35.1 182%
Intangible
amortization(2)
(3) 289.5 55.3 424% 715.0 161.5 343%
Non-operating
expense
(income)(4) 3.5 (21.2) (117)% 34.1 (13.7) (349)%
------------- ------------- ------------- -------------
Non-GAAP
adjusted
income before
applicable
income taxes 382.2 204.4 87% 1,024.5 563.4 82%
Less: Adjustments
Adjusted tax
expense(5) 50.9 35.9 42% 128.7 94.8 36%
Adjusted tax rate 13% 18% 13% 17%
Other(6) 0.5 0.5 -% 1.2 1.2 -%
------------- ------------- ------------- -------------
Adjusted net
income $ 330.8 $ 168.0 97% $ 894.6 $ 467.4 91%
=== ======== === ======== === ======== === ========
Adjusted net
income
per share $ 1.05 $ 0.90 17% $ 2.92 $ 2.41 21%
Adjusted shares
outstanding(7) 313,881,826 186,524,461 306,107,456 193,860,354
Non-GAAP and Adjusted Financial Measures
This schedule presents non-GAAP and adjusted financial measures,
which are important financial performance measures for the Company,
but are not financial measures as defined by GAAP. Such financial
measures should not be considered as alternatives to GAAP, and such
measures may not be comparable to those reported by other
companies.
Adjusted net income is derived from GAAP income before
applicable income taxes and adjusted for the following items
described below:
(1) Represents acquisition and integration costs incurred in
connection with our acquisitions, charges related to employee
terminations and other transition activities. Included in
Transition, acquisition and integration costs in the nine months
ended September 30, 2017 is a $38 million charge to G&A related
to a settlement agreement stemming from legacy litigation of an
acquired company.
(2) Below are the adjustments to Other operating costs, General
and administrative and Depreciation and amortization.
Three Months Ended September Three Months Ended September
30, 2018 30, 2017
Transition, Amortization Transition, Amortization
Acquisition Share-Based of Intangible Acquisition Share-Based of Intangible
& Integration Compensation Assets & Integration Compensation Assets
-------------- --------------- --------------- -------------- --------------- -----------------
Other operating
costs $ 16.8 $ - $ - $ 2.6 $ - $ -
General and
administrative 30.6 42.8 - 2.5 13.6 -
Depreciation
and
amortization - - 289.5 - - 55.3
-------------- --------------- --------------- -------------- --------------- ---------------
Total
adjustments $ 47.4 $ 42.8 $ 289.5 $ 5.1 $ 13.6 $ 55.3
===== ======= ===== ======== ===== ======== ====== ====== ====== ======= ===== ========
Nine Months Ended September Nine Months Ended September
30, 2018 30, 2017
Transition, Amortization Transition, Amortization
Acquisition Share-Based of Intangible Acquisition Share-Based of Intangible
& Integration Compensation Assets & Integration Compensation Assets
-------------- --------------- --------------- -------------- --------------- -----------------
Other operating
costs $ 54.0 $ - $ - $ 10.9 $ - $ -
General and
administrative 223.6 99.0 - 57.0 35.1 -
Depreciation
and
amortization - - 715.0 - - 161.5
-------------- --------------- --------------- -------------- --------------- ---------------
Total
adjustments $ 277.6 $ 99.0 $ 715.0 $ 67.9 $ 35.1 $ 161.5
===== ======= ===== ======== ===== ======== ===== ======= ===== ======== ===== ========
(3) Represents amortization of intangible assets acquired
through business combinations and customer portfolio and related
asset acquisitions.
(4) See note (2) in Schedule 1.
(5) Represents adjusted income tax expense to reflect an
effective tax rate of 19.8% for 2018 and 34.0% for 2017, assuming
the conversion of the Class B units of Worldpay Holding into shares
of Class A common stock, including the tax effect of adjustments
described above. Adjusted tax expense includes tax benefits due to:
(1) the amortization of intangible assets and other tax attributes
resulting from or acquired with our acquisitions, (2) the tax basis
step up associated with our separation from Fifth Third Bank and
(3) the purchase or exchange of Class B units of Worldpay Holding,
net of payment obligations under tax receivable agreements. The
effective tax rate is expected to remain at 19.8% for the remainder
of 2018.
(6) Represents the non-controlling interest, net of adjusted
income tax expense discussed in (5) above, associated with a
consolidated joint venture.
(7) The adjusted shares outstanding includes 13.5 million of
weighted average Class B units of Worldpay Holding and other
potentially dilutive securities that are excluded from the GAAP
dilutive net income per share calculation for the nine months ended
September 30, 2018. The adjusted shares outstanding includes 23.6
million and 31.2 million of weighted average Class B units of
Worldpay Holding that are excluded from the GAAP dilutive net
income per share calculation for the three and nine months ended
September 30, 2017, respectively.
Schedule 3
Worldpay, Inc.
Segment Information
(Unaudited)
(in millions)
Technology Solutions
Three Months Ended September
30,
2018 2017 % Change
----------------- ---------------- -----------
Revenue $ 419.7 $ 339.9 23%
Network fees and other
costs - 115.2 NM
----------------- ----------------
Net revenue(1) 419.7 224.7 87%
Sales and marketing 115.2 73.6 57%
----------------- ----------------
Segment profit $ 304.5 $ 151.1 102%
=== ============ ============ ======
Nine Months Ended September
30,
2018 2017 % Change
------------------ -------------- -----------
Revenue $ 1,157.7 $ 919.4 26%
Network fees and other
costs - 335.3 NM
------------------ --------------
Net revenue(1) 1,157.7 584.1 98%
Sales and marketing 309.2 203.3 52%
------------------ --------------
Segment profit $ 848.5 $ 380.8 123%
============== ========== ======
Merchant Solutions
Three Months Ended September
30,
2018 2017 % Change
----------------- ---------------- -----------
Revenue $ 507.5 $ 576.7 (12)%
Network fees and other
costs - 332.6 NM
----------------- ----------------
Net revenue(1) 507.5 244.1 108%
Sales and marketing 174.0 94.4 84%
----------------- ----------------
Segment profit $ 333.5 $ 149.7 123%
=== ============ ============ ======
Nine Months Ended September
30,
2018 2017 % Change
----------------- ------------- -----------
Revenue $ 1,460.1 $ 1,695.9 (14)%
Network fees and other
costs - 976.2 NM
----------------- -------------
Net revenue(1) 1,460.1 719.7 103%
Sales and marketing 516.8 276.3 87%
----------------- -------------
Segment profit $ 943.3 $ 443.4 113%
============= ============ ======
Issuer Solutions
Three Months Ended September
30,
2018 2017 % Change
---------------- ----------------- -----------
Revenue $ 90.7 $ 117.1 (23)%
Network fees and other
costs - 31.7 NM
---------------- -----------------
Net revenue(1) 90.7 85.4 6%
Sales and marketing 6.6 5.8 14%
---------------- ----------------- ------
Segment profit $ 84.1 $ 79.6 6%
=== =========== ============= ======
Nine Months Ended September 30,
2018 2017 % Change
------------------- ----------------- -----------
Revenue $ 257.6 $ 345.3 (25)%
Network fees and other
costs - 94.8 NM
------------------- -----------------
Net revenue(1) 257.6 250.5 3%
Sales and marketing 19.2 17.5 10%
------------------- ----------------- ------
Segment profit $ 238.4 $ 233.0 2%
=== ============== ============= ======
(1) See note (1) in Schedule 1.
Schedule 4
Worldpay, Inc.
Condensed Consolidated Statements of Financial Position
(Unaudited)
(in millions)
September December
30, 2018 31, 2017
------------ --------------
Assets
Current assets:
Cash and cash equivalents $ 373.7 $ 126.5
Accounts receivable-net 1,599.8 986.6
Merchant float 1,427.9 -
Settlement assets 3,306.8 142.0
Prepaid expenses 87.3 33.5
Other 549.3 84.0
------------ ------------
Total current assets 7,344.8 1,372.6
Customer incentives 66.3 68.4
Property, equipment and software-net 1,053.8 473.7
Intangible assets-net 3,364.8 678.5
Goodwill 14,674.8 4,173.0
Deferred taxes 789.8 739.5
Proceeds from senior unsecured notes - 1,135.2
Other assets 67.2 26.1
------------
Total assets $ 27,361.5 $ 8,667.0
======== ========
Liabilities and equity
Current liabilities:
Accounts payable and accrued expenses $ 1,169.2 $ 631.9
Settlement obligations 5,396.3 816.2
Current portion of notes payable 226.5 107.9
Current portion of tax receivable agreement
obligations 109.1 245.5
Deferred income 23.1 18.9
Current maturities of capital lease obligations 25.2 8.0
Other 609.9 6.0
------------ ------------
Total current liabilities 7,559.3 1,834.4
Long-term liabilities:
Notes payable 7,723.7 5,586.4
Tax receivable agreement obligations 589.7 535.0
Capital lease obligations 22.4 4.5
Deferred taxes 540.3 65.6
Other 104.6 40.5
------------ ------------
Total long-term liabilities 8,980.7 6,232.0
Total liabilities 16,540.0 8,066.4
Commitments and contingencies
Equity:
Total equity (1) 10,821.5 600.6
------------ ------------
Total liabilities and equity $ 27,361.5 $ 8,667.0
======== ========
(1) Includes equity attributable to non-controlling interests.
Schedule 5
Worldpay, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
(in millions)
Nine Months Ended
September September
30, 2018 30, 2017
------------- --------------
Operating Activities:
Net (loss) income $ (96.2) $ 229.1
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization expense 824.0 237.0
Amortization of customer incentives 19.9 18.7
Amortization and write-off of debt issuance
costs 73.2 3.9
Gain on foreign currency forward (35.9) (24.4)
Share-based compensation expense 99.0 35.1
Deferred tax expense (26.2) 60.0
Tax receivable agreements non-cash items (4.7) (6.1)
Other (6.5) 2.3
Change in operating assets and liabilities:
Accounts receivable (67.0) 46.7
Net settlement assets and obligations (366.5) 4.3
Customer incentives (19.4) (17.7)
Prepaid and other assets (22.4) (82.9)
Accounts payable and accrued expenses (140.8) 22.3
Other liabilities (10.9) (17.4)
------------ -----------
Net cash provided by operating activities 219.6 510.9
------------ -----------
Investing Activities:
Purchases of property and equipment (191.9) (81.9)
Acquisition of customer portfolios and related
assets and other (56.0) (38.2)
Purchase of interest rate caps (8.1) 0
Proceeds from foreign currency forward 71.5 -
Cash acquired (used) in acquisitions, net of
cash used 1,396.3 (531.5)
------------ -----------
Net cash provided by (used in) investing
activities 1,211.8 (651.6)
------------ -----------
Financing Activities:
Proceeds from issuance of long-term debt 2,951.8 1,270.0
Borrowings on revolving credit facility 3,308.0 5,405.0
Repayment of revolving credit facility (3,533.0) (5,046.0)
Repayment of debt and capital lease obligations (2,732.6) (108.0)
Payment of debt issuance costs (91.1) (24.0)
Proceeds from issuance of Class A common stock
under employee stock plans 18.2 10.8
Repurchase of Class A common stock (to satisfy
tax withholding obligations) (16.2) (9.2)
Purchase and cancellation of Class A common
stock - (1,268.1)
Settlement of certain tax receivable agreements (112.5) (77.3)
Payments under tax receivable agreements (55.3) (46.5)
Distributions to non-controlling interests (7.7) (12.5)
------------ -----------
Net cash (used in) provided by financing
activities (270.4) 94.2
------------ -----------
Net increase (decrease) in cash and cash equivalents 1,161.0 (46.5)
Cash and cash equivalents-Beginning of period 1,272.2 139.1
Effect of exchange rate changes on cash (143.5) -
------------ -----------
Cash and cash equivalents-End of period $ 2,289.7 $ 92.6
=== ======= === ======
Cash Payments:
Interest $ 205.1 $ 94.3
Income taxes 16.7 31.6
Schedule 6
Worldpay, Inc.
Reconciliation of GAAP Net Income to Adjusted EBITDA
(Unaudited)
(in millions)
Three Months Ended Nine Months Ended
September 30, September 30,
2018 2017 % Change 2018 2017 % Change
--------------- -------- ----------- ------------- ------- -----------
Net income (loss) $ 3.6 $ 106.9 (97)% $ (96.2) $229.1 (142)%
Income tax (benefit)
expense (4.6) 44.7 (110)% (5.0) 83.5 (106)%
Non-operating
expense (income)(1) 3.5 (21.2) (117)% 34.1 (13.7) (349)%
Interest expense-net 75.2 38.5 95% 230.3 97.4 136%
Share-based
compensation 42.8 13.6 215% 99.0 35.1 182%
Transition,
acquisition and
integration
costs(2) 47.4 5.1 829% 277.6 67.9 309%
Depreciation and
amortization 328.9 82.5 299% 824.0 237.0 248%
----------- ------- ------------ ------
Adjusted EBITDA $ 496.8 $ 270.1 84% $ 1,363.8 $736.3 85%
======= ====== ======== =====
Non-GAAP Financial Measures
This schedule presents adjusted EBITDA, which is an important
financial performance measure for the Company, but is not a
financial measure as defined by GAAP. Such financial measure should
not be considered as an alternative to GAAP net income, and such
measure may not be comparable to those reported by other
companies.
(1) See note (2) in Schedule 1.
(2) See note (2) in Schedule 2.
Schedule 7
Worldpay, Inc.
Outlook Summary
(Unaudited)
Fourth Quarter Financial Full Year Financial
Outlook Outlook
-------------------------------- ----------------------------
Three Months Ended December Year Ended December
31, 31,
2017 Actual 2018 Outlook 2017 Actual
2018 Outlook (2) (1) (2)
----------------- ------------ -------------- ------------
GAAP net income (loss) per
share attributable to Worldpay, ($0.25) -
Inc. $0.06 - $0.20 $(0.37) ($0.09) $0.80
Adjustments to reconcile
GAAP to non-GAAP adjusted
net income per share(3) $0.99 - $0.90 $1.34 $4.20 - $4.09 $2.57
------------------ --------------
Adjusted net income per share $1.05 - $1.10 $0.97 $3.95 - $4.00 $3.37
================== ============ ============== ============
Non-GAAP and Adjusted Financial Measures
This schedule presents non-GAAP and adjusted financial measures,
which are important financial performance measures for the Company,
but are not financial measures as defined by GAAP. Such financial
measures should not be considered as alternatives to GAAP, and such
measures may not be comparable to those reported by other
companies.
(1) Combined company guidance excludes Worldpay Group plc EPS
contribution for the period prior to the acquisition closing from
January 1, 2018 to January 15, 2018. Combined company guidance is
based on an assumed exchange rate of U.S. dollar/pound sterling of
$1.31.
(2) 2017 actuals include Vantiv, Inc. results only.
(3) Represents estimated ranges of adjustments including the
following items: (a) acquisition and integration costs incurred in
connection with our acquisitions, charges related to employee
termination benefits and other transition activities; (b)
share-based compensation; (c) amortization of intangible assets
acquired in business combinations and customer portfolio and
related asset acquisitions; (d) non-operating income (expenses),
(f) adjustments to income tax expense to reflect an effective tax
rate based on tax reform and our new tax structure for the three
months ended December 31, 2018 and the full year 2018, which
includes the impact of the excess tax benefit relating to stock
compensation as a result of the Company adopting the new stock
compensation accounting guidance in 2017, assuming conversion of
the Fifth Third Bank non-controlling interests into shares of Class
A common stock, including the tax effect of adjustments described
above; and (g) tax benefits due to the amortization of intangible
assets and other tax attributes resulting from or acquired with our
acquisitions, and to the tax basis step up associated with our
separation from Fifth Third Bank and the purchase or exchange of
Class B units of Worldpay Holding, net of payment obligations under
tax receivable agreements.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
QRTFKFDPDBDDPDK
(END) Dow Jones Newswires
November 08, 2018 07:00 ET (12:00 GMT)
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