Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Feb. 20, 2015 | Jun. 30, 2014 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | EVTC | ||
Entity Registrant Name | EVERTEC, Inc. | ||
Entity Central Index Key | 1559865 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 77,893,144 | ||
Entity Public Float | $1,577,414,218 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash | $32,114 | $22,485 |
Restricted cash | 5,718 | 5,433 |
Accounts receivable, net | 75,810 | 68,434 |
Deferred tax asset | 399 | 2,537 |
Prepaid expenses and other assets | 20,565 | 19,482 |
Total current assets | 134,606 | 118,371 |
Investment in equity investee | 11,756 | 10,639 |
Property and equipment, net | 29,535 | 33,240 |
Goodwill | 368,837 | 373,119 |
Other intangible assets, net | 334,584 | 367,780 |
Other long-term assets | 10,917 | 18,162 |
Total assets | 890,235 | 921,311 |
Current Liabilities: | ||
Accrued liabilities | 26,052 | 26,571 |
Accounts payable | 22,879 | 20,588 |
Unearned income | 9,825 | 5,595 |
Income tax payable | 1,956 | 259 |
Current portion of long-term debt | 19,000 | 19,000 |
Short-term borrowings | 23,000 | 51,200 |
Deferred tax liability, net | 1,799 | 543 |
Total current liabilities | 104,511 | 123,756 |
Long-term debt | 647,579 | 665,680 |
Long-term deferred tax liability, net | 15,674 | 20,212 |
Other long-term liabilities | 2,898 | 333 |
Total liabilities | 770,662 | 809,981 |
Commitments and contingencies (Note 20) | ||
Stockholders' equity | ||
Preferred stock, par value $0.01; 2,000,000 shares authorized; none issued | ||
Common stock, par value $0.01; 206,000,000 shares authorized; 77,893,144 shares issued and outstanding at December 31, 2014 (December 31, 2013 - 78,286,465) | 779 | 783 |
Additional paid-in capital | 59,740 | 80,718 |
Accumulated earnings | 65,576 | 29,403 |
Accumulated other comprehensive (loss) income, net of tax | -6,522 | 426 |
Total stockholders' equity | 119,573 | 111,330 |
Total liabilities and stockholders' equity | $890,235 | $921,311 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ||
Preferred stock par value | $0.01 | $0.01 |
Preferred stock authorized | 2,000,000 | 2,000,000 |
Preferred stock issued | 0 | 0 |
Common stock par value | $0.01 | $0.01 |
Common stock authorized | 206,000,000 | 206,000,000 |
Common stock issued | 77,893,144 | 78,286,465 |
Common stock outstanding | 77,893,144 | 78,286,465 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues | |||
Merchant Acquiring, net | $79,136 | $73,616 | $69,591 |
Payment Processing (from affiliates: $27,094 $26,747 and $26,073) | 105,423 | 100,104 | 95,607 |
Business Solutions (from affiliates: $134,512, $137,560 and $125,635) | 176,570 | 184,297 | 177,292 |
Total revenues | 361,129 | 358,017 | 342,490 |
Operating costs and expenses | |||
Cost of revenues, exclusive of depreciation and amortization shown below | 156,517 | 163,080 | 159,666 |
Selling, general and administrative expenses | 41,276 | 38,810 | 31,686 |
Depreciation and amortization | 65,988 | 70,366 | 71,492 |
Total operating costs and expenses | 263,781 | 272,256 | 262,844 |
Income from operations | 97,348 | 85,761 | 79,646 |
Non-operating (expenses) income | |||
Interest income | 328 | 236 | 320 |
Interest expense | -26,081 | -37,861 | -54,331 |
Earnings of equity method investment | 1,140 | 935 | 564 |
Other income (expenses): | |||
Loss on extinguishment of debt | -58,464 | ||
Termination of consulting agreements | -16,718 | ||
Other income (expenses) | 2,375 | -500 | -8,491 |
Total other income (expenses) | 2,375 | -75,682 | -8,491 |
Total non-operating expenses | -22,238 | -112,372 | -61,938 |
Income (loss) before income taxes | 75,110 | -26,611 | 17,708 |
Income tax expense (benefit) | 7,578 | -1,990 | -59,658 |
Net income (loss) | 67,532 | -24,621 | 77,366 |
Other comprehensive (loss) income, net of tax of $4, $59 and $13 Foreign currency translation adjustments | -6,948 | 1,268 | 476 |
Total comprehensive income (loss) | $60,584 | ($23,353) | $77,842 |
Net income (loss) per common share-basic | $0.86 | ($0.31) | $1.06 |
Net income (loss) per common share-diluted | $0.86 | ($0.31) | $1.01 |
Consolidated_Statements_of_Inc1
Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Statement [Abstract] | |||
Payment processing revenue from affiliates | $27,094 | $26,747 | $26,073 |
Business solutions revenue from affiliates | 134,512 | 137,560 | 125,635 |
Other comprehensive income, income tax expense | $4 | $59 | $13 |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Stockholders' Equity (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | |
In Thousands, except Share data | ||||||
Beginning Balance, Value at Dec. 31, 2011 | $366,176 | $726 | $363,130 | $3,638 | ($1,318) | |
Beginning Balance, Shares at Dec. 31, 2011 | 72,754,448 | |||||
Issuance of common stock | 450 | 2 | 448 | |||
Issuance of common stock, Shares | 91,696 | |||||
Share-based compensation recognized | 1,204 | 1,204 | ||||
Dividend | [1] | -323,217 | -312,627 | -10,590 | ||
Net income (loss) | 77,366 | 77,366 | ||||
Other comprehensive income (loss) | 476 | 476 | ||||
Ending Balance, Value at Dec. 31, 2012 | 122,455 | 728 | 52,155 | 70,414 | -842 | |
Ending Balance, Shares at Dec. 31, 2012 | 72,846,144 | |||||
Issuance of common stock | 112,432 | 63 | 112,369 | |||
Issuance of common stock upon initial public offering, net of offering costs, Shares | 6,250,000 | |||||
Share-based compensation recognized | 6,179 | 6,179 | ||||
Tax windfall benefit on exercises of stock options and vesting of restricted stocks | 1,829 | 1,829 | ||||
Stock options exercised, net of cashless exercise | -16,822 | 29 | -16,851 | |||
Stock options exercised, net of cashless exercise, Shares | 2,880,357 | |||||
Repurchase of common stock | -75,000 | -37 | -74,963 | |||
Repurchase of common stock, Shares | -3,690,036 | |||||
Net income (loss) | -24,621 | -24,621 | ||||
Cash dividends paid on common stock | -16,390 | -16,390 | ||||
Other comprehensive income (loss) | 1,268 | 1,268 | ||||
Ending Balance, Value at Dec. 31, 2013 | 111,330 | 783 | 80,718 | 29,403 | 426 | |
Ending Balance, Shares at Dec. 31, 2013 | 78,286,465 | 78,286,465 | ||||
Share-based compensation recognized | 4,587 | 4,587 | ||||
Dividend | [2] | 21 | 21 | |||
Tax windfall benefit on exercises of stock options and vesting of restricted stocks | 3,669 | 3,669 | ||||
Stock options exercised, net of cashless exercise | -1,432 | 8 | -1,440 | |||
Stock options exercised, net of cashless exercise, Shares | 799,885 | |||||
Restricted stock units delivered | -26 | -26 | ||||
Restricted stock units delivered, Shares | 7,988 | |||||
Repurchase of common stock | -26,197 | -12 | -26,185 | |||
Repurchase of common stock, Shares | -1,201,194 | |||||
Net income (loss) | 67,532 | 67,532 | ||||
Cash dividends paid on common stock | -31,359 | -31,359 | ||||
Cash settlement of stock options | -1,604 | -1,604 | ||||
Other comprehensive income (loss) | -6,948 | -6,948 | ||||
Ending Balance, Value at Dec. 31, 2014 | $119,573 | $779 | $59,740 | $65,576 | ($6,522) | |
Ending Balance, Shares at Dec. 31, 2014 | 77,893,144 | 77,893,144 | ||||
[1] | Includes an equitable adjustment to holders of outstanding stock options in consideration to dividends declared on December 18, 2012 amounting to approximately $3.6 million. | |||||
[2] | Related to dividend declared in 2012 and accrued upon vesting of stock options. Such options were forfeited during 2014. |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities | |||
Net income (loss) | $67,532 | ($24,621) | $77,366 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 65,988 | 70,366 | 71,492 |
Amortization of debt issue costs and premium and accretion of discount | 3,094 | 3,905 | 5,091 |
Write-off of debt issue costs, premium and discount accounted as loss on extinguishment of debt | 16,555 | ||
Provision for doubtful accounts and sundry losses | 1,360 | 673 | 1,645 |
Deferred tax benefit | -1,713 | -5,702 | -66,568 |
Share-based compensation | 4,587 | 6,179 | 1,204 |
Unrealized loss (gain) of indemnification assets | 446 | 383 | -966 |
Amortization of a contract liability | -703 | ||
Loss on disposition of property and equipment and other intangibles | 734 | 538 | 1,671 |
Earnings of equity method investment | -1,140 | -935 | -564 |
Dividend received from equity method investment | 326 | 984 | 1,630 |
Premium on issuance of long-term debt | 2,000 | ||
(Increase) decrease in assets: | |||
Accounts receivable, net | -6,608 | 9,243 | -15,966 |
Prepaid expenses and other assets | -1,067 | 1,685 | 2,257 |
Other long-term assets | 3,365 | -1,381 | -3,567 |
(Decrease) increase in liabilities: | |||
Accounts payable and accrued liabilities | -2,883 | -16,734 | 6,800 |
Income tax payable | 1,697 | -2,700 | -424 |
Unearned income | 4,230 | 4,429 | 266 |
Total adjustments | 72,416 | 87,488 | 5,298 |
Net cash provided by operating activities | 139,948 | 62,867 | 82,664 |
Cash flows from investing activities | |||
Net (increase) decrease in restricted cash | -285 | -494 | 349 |
Intangible assets acquired | -15,046 | -16,980 | -10,896 |
Property and equipment acquired | -10,898 | -11,486 | -16,613 |
Proceeds from sales of property and equipment | 59 | 16 | 118 |
Net cash used in investing activities | -26,170 | -28,944 | -27,042 |
Cash flows from financing activities | |||
Proceeds from initial public offering, net of offering costs of $12,567 | 112,432 | ||
Proceeds from issuance of long-term debt | 700,000 | 208,725 | |
Debt issuance costs | -12,077 | -2,174 | |
Net (decrease) increase in short-term borrowings | -27,000 | 36,000 | 14,000 |
Proceeds from new short-term borrowing for purchase of equipment | 1,800 | 12,995 | |
Repayments of short-term borrowing for purchase of equipment | -1,200 | -13,596 | |
Dividends paid | -31,359 | -16,390 | -319,959 |
Statutory minimum withholding taxes paid on cashless exercises of stock options | -2,001 | -16,851 | |
Tax windfall benefits on exercises of stock options and vesting of restricted stocks | 3,669 | 1,829 | |
Issuance of common stock | 543 | 29 | 450 |
Repurchase of common stock | -26,197 | -75,000 | |
Settlement of stock options | -1,604 | ||
Repayment and repurchase of long-term debt | -19,000 | -755,024 | |
Repayment of other financing agreement | -224 | -225 | |
Net cash (used in) provided by financing activities | -104,149 | -37,072 | -86,188 |
Net increase (decrease) in cash | 9,629 | -3,149 | -30,566 |
Cash at beginning of the period | 22,485 | 25,634 | 56,200 |
Cash at end of the period | 32,114 | 22,485 | 25,634 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 24,280 | 41,340 | 45,703 |
Cash paid for income taxes | 976 | 2,340 | 2,837 |
Supplemental disclosure of non-cash activities: | |||
Liability related to unvested portion of stock options as a result of equitable adjustment (Note 14) | 3,151 | ||
Payable due to vendor related to property and equipment and software acquired | $6,115 | $3,006 |
Consolidated_Statements_of_Cas1
Consolidated Statements of Cash Flows (Parenthetical) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
Statement of Cash Flows [Abstract] | |
Proceeds from initial public offering, net of cost of offering | $12,567 |
The_Company_and_Summary_of_Sig
The Company and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2014 | |
Accounting Policies [Abstract] | |
The Company and Summary of Significant Accounting Policies | Note 1—The Company and Summary of Significant Accounting Policies |
The Company | |
EVERTEC, Inc. (formerly known as Carib Latam Holdings, Inc.) and its subsidiaries (collectively the “Company,” or “EVERTEC”) is the leading full-service transaction processing business in Latin America and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment processing and business process management services across 19 countries in the region. EVERTEC owns and operates the ATH network, one of the leading automated teller machine (“ATM”) and personal identification number (“PIN”) debit networks in Latin America. In addition, EVERTEC provides a comprehensive suite of services for core bank processing, cash processing and technology outsourcing in the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations and government agencies with “mission-critical” technology solutions that are essential to their operations, enabling them to issue, process and accept transactions securely. Management believes that the Company’s business is well-positioned to continue to expand across the fast-growing Latin American region. | |
Initial Public Offering and Other Public Offerings | |
On April 17, 2013, the Company completed its initial public offering of 28,789,943 shares of common stock at a price to the public of $20.00 per share. A total of 6,250,000 shares were offered by the Company and a total of 22,539,943 shares were offered by selling stockholders, of which 13,739,284 shares were sold by an affiliate of Apollo Global Management, LLC (“Apollo”) and 8,800,659 shares were sold by Popular, Inc. (“Popular”). The Company used the net proceeds of approximately $117.4 million, after the deduction of underwriting discount and commissions, from the sale of shares in the initial public offering and proceeds from borrowings under the 2013 Credit Agreement (as defined below), together with available cash on hand, to redeem the Company’s 11.0% senior notes due 2018 (the “senior notes”) and to refinance the Company’s previous senior secured credit facilities. | |
On September 18, 2013, the Company completed a public offering of 23,000,000 shares of the Company’s common stock by Apollo, Popular, and current and former employees at a price to the public of $22.50 per share. EVERTEC did not receive any proceeds from this offering. After the completion of the offering, Apollo owned approximately 9.2 million shares of EVERTEC’s common stock, or 11.2%, and Popular owned approximately 17.5 million shares of EVERTEC’s common stock, or 21.3%. | |
On December 13, 2013, the Company completed a public offering of 15,233,273 shares of its common stock by Apollo, Popular, and current and former employees at a price to the public of $20.60 per share. EVERTEC did not receive any proceeds from this offering. After the completion of the offering, Popular owned approximately 11.7 million shares of EVERTEC’s common stock, or 14.9%, and Apollo no longer owns any of the Company’s common stock. | |
Basis of Presentation | |
The consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, the accompanying consolidated financial statements, prepared in accordance with GAAP, contain all adjustments, all of which are normal and recurring in nature, necessary for a fair presentation. All significant intercompany accounts and transactions have been eliminated in consolidation. | |
Certain reclassifications have been made to the consolidated financial statements and related notes to conform with the presentation in 2014. | |
A summary of the most significant accounting policies used in preparing the accompanying consolidated financial statements is as follows: | |
Principles of Consolidation | |
The accompanying consolidated financial statements include the accounts and operations of the Company, which are presented in accordance with GAAP. The Company consolidates all entities that are controlled by ownership of a majority voting interest. All significant intercompany accounts and transactions are eliminated in the consolidated financial statements. | |
Use of Estimates | |
The preparation of the accompanying consolidated financial statements 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 financial statements and the reported amounts of revenues and expenses during the reporting period. | |
Revenue Recognition | |
The Company’s revenue recognition policy follows the guidance from Accounting Standards Codification (“ASC”) 605 Revenue Recognition; ASC 605-25, Revenue Recognition-Multiple Element Arrangements; and; ASC 985, Software, which provide guidance on the recognition, presentation, and disclosure of revenue in financial statements. | |
The Company recognizes revenue when the following four criteria are met: (i) persuasive evidence of an agreement exists, (ii) delivery and acceptance has occurred or services have been rendered, (iii) the selling price is fixed or determinable, and (iv) collection is reasonably assured. For multiple deliverable arrangements, EVERTEC evaluates each arrangement to determine if the elements or deliverables within the arrangement represent separate units of accounting pursuant to ASC 605-25. If the deliverables are determined to be separate units of accounting, revenues are recognized as these are delivered and revenue recognition criteria are met. If the deliverables are not determined to be separate units of accounting, revenues for the delivered services are combined into one unit of accounting and recognized (i) over the life of the arrangement if all services are consistently delivered over such term, or if otherwise, (ii) at the time that all services and deliverables have been delivered. The selling price for each deliverable is based on vendor specific objective evidence (“VSOE”) if available, third party evidence (“TPE”) if VSOE is not available, or management best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. EVERTEC establishes VSOE of selling price using the price charged when the same element is sold separately. EVERTEC bifurcates or allocates the arrangement consideration to each of the deliverables based on the relative selling price of each unit of accounting. | |
The Company has two main categories of revenues according to the type of transactions EVERTEC enters into with the Company’s customers: (a) transaction-based fees and (b) fixed fees and time and material. | |
Transaction-based fees | |
The Company provides services that generate transaction-based fees. Typically transaction-based fees depend on factors such as number of accounts or transactions processed. These factors typically consist of a fee per transaction or item processed, a percentage of dollar volume processed or a fee per account on file, or some combination thereof. Revenue derived from the transaction-based fee contracts are recognized when the underlying transaction is processed, which constitutes delivery of service. | |
Revenues from business contracts in the Company’s Merchant Acquiring segment are primarily comprised of discount fees charged to the merchants based on the sales amount of transactions processed. Revenues include a discount fee and membership fees charged to merchants and debit network fees as well as point-of-sale (“POS”) rental fees. Pursuant to the guidance from ASC 605-45-45, Revenue Recognition—Principal Agent Considerations, EVERTEC records Merchant Acquiring revenues net of interchange and assessments charged by the credit and debit card network associations and recognizes such revenues at the time of the sale (when a transaction is processed). | |
Payment processing revenues are comprised of revenues related to providing access to the ATH network and other card networks to financial institutions, and related services. Payment processing revenues also include revenues from card issuer processing services (such as credit and debit card processing, authorization and settlement, and fraud monitoring and control to debit or credit card issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions) and EBT (which principally consists of services to the Puerto Rico government for the delivery of government benefits to participants). Revenues in EVERTEC’s Payment Processing segment are primarily comprised of fees per transaction processed or per account on file, or a combination of both, and are recognized at the time transactions are processed or on a monthly basis for accounts on file. | |
Transaction-based fees within EVERTEC’s Business Solutions segment consist of revenues from business process management solutions including core bank processing, business process outsourcing, item and cash processing, and fulfillment. Transaction-based fee revenues generated by the Company’s core bank processing services are derived from fees based on various factors such as the number of accounts on file (e.g. savings or checking accounts, loans, etc.), and the number of transactions processed or registered users (e.g. for online banking services). For services dependent on the number of transactions processed, revenues are recognized as the underlying transactions are processed. For services dependent on the number of users or accounts on file, revenues are recognized on a monthly basis based on the number of accounts on file each month. Item and cash processing revenues are based upon the number of items (e.g. checks) processed and revenues are recognized when the underlying item is processed. Fulfillment services include technical and operational resources for producing and distributing variable print documents such as statements, bills, checks and benefits summaries. Fulfillment revenues are based upon the number pages for printing services and the number of envelopes processed for mailing services. Revenues are recognized as services are delivered based on a fee per page printed or envelope mailed, as applicable. | |
Fixed fees and time and material | |
The Company also provides services that generate a fixed fee per month or fees based on time and expenses incurred. These services are mostly provided in EVERTEC’s Business Solutions segment. Revenues are generated from EVERTEC’s core bank solutions, network hosting and management and IT consulting services. | |
In core bank solutions, the Company mostly provides access to applications and services such as back-up or recovery, hosting and maintenance that enable a bank to operate the related hosted services accessing the Company’s IT infrastructure. These contracts generally contain multiple elements or deliverables which are evaluated by EVERTEC and revenues are recognized according to the applicable guidance. Revenue is derived from fixed fees charged for the use of hosted services and are recognized on a monthly basis as delivered. Set-up fees are billed to the customer when the service is rendered; however, they are deferred and recognized as revenues over the term of the arrangement or the expected period of the customer relationship, whichever is longer, as set-up services rarely provide value to the customer on a stand-alone basis and are interrelated with the service to be provided under the contract. | |
In network hosting and management, EVERTEC provides hosting services for network infrastructure at EVETEC’s facilities; automated monitoring services; maintenance of call centers; interactive voice response solutions, among other related services. Revenues are primarily derived from monthly fees as services are delivered. Set-up fees are billed up-front to the customer when the set-up service is rendered; however, they are deferred and recognized as revenues over the term of the arrangement or the expected period of the customer relationship, whichever is longer, as set-up services rarely provide value to the customer on a stand-alone basis and are interrelated with the service under the contract. There are some arrangements under this line of service category that may contain undelivered elements. In such cases, the undelivered elements are evaluated and recognized when the services are delivered or at the time that all deliverables under the contract have been delivered. | |
IT consulting services revenue primarily consists of time billings based upon the number of hours dedicated to each client. Revenue from time billings are recognized as services are delivered. | |
EVERTEC also charges members of the ATH network an annual membership fee; however, these fees are deferred and recognized as revenues on a straight-line basis over the year and recorded in the Company’s Payment Processing segment. In addition, occasionally EVERTEC is a reseller of hardware and software products and revenues from these resale transactions are recognized when such product is delivered and accepted by the client. | |
Service level arrangements | |
The Company’s service contracts may include service level arrangements (“SLA”) generally allowing the customer to receive a credit for part of the service fee when the Company has not provided the agreed level of services. The SLA performance obligation is committed on a monthly basis, thus SLA performance is monitored and assessed for compliance with arrangements on a monthly basis, including determination and accounting for its economic impact, if any. | |
Investment in Equity Investee | |
The Company accounts for investments using the equity method of accounting if the investment provides the Company the ability to exercise significant influence, but not control, over an investee. Significant influence is generally deemed to exist if the Company has an ownership interest in the voting stock of an investor of between 20 percent and 50 percent, although other factors are considered in determining whether the equity method of accounting is appropriate. Under this method, the investment, originally recorded at cost, is adjusted to recognize the Company’s share of net income or losses as they occur. The Company’s share of investee earnings or losses is recorded, net of taxes, within earnings in equity method investment caption in the consolidated statements of income (loss) and comprehensive income (loss). The Company’s consolidated revenues include fees for services provided to an investee accounted under the equity method. Additionally, the Company’s interest in the net asset of its equity method investee is reflected in the consolidated balance sheets. On the acquisition of the investment any difference between the cost of the investment and the amount of the underlying equity in net assets of an investee is required to be accounted as if the investee were a consolidated subsidiary. If the difference is assigned to depreciable or amortizable assets or liabilities, then the difference should be amortized or accreted in connection with the equity earnings based on the Company’s proportionate share of the investee’s net income or loss. If the investor is unable to relate the difference to specific accounts of the investee, the difference should be considered to be goodwill. | |
The Company considers whether the fair values of its equity method investment have declined below their carrying value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If the Company considered any such decline to be other than temporary (based on various factors, including historical financial results, product development activities and the overall health of the investee’s industry), then the Company would record a write-down to estimated fair value. | |
Property and Equipment | |
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method and expensed over their estimated useful lives. Amortization of leasehold improvements is computed over the terms of the respective leases, including renewal options considered by management to be reasonably assured of being exercised, or the estimated useful lives of the improvements, whichever is shorter. Costs of maintenance and repairs which do not improve or extend the life of the respective assets are expensed as incurred. | |
Impairment on Long-lived Assets | |
Long-lived assets to be held and used, and long-lived assets to be disposed of, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. | |
Capitalization of Software | |
EVERTEC Group develops software that is used in providing processing services to customers. Capitalized software includes purchased software and internally-developed software and is recognized as software packages within the other intangible assets line item in the consolidated balance sheets. Capitalization of internally developed software occurs only after the preliminary project stage is complete and management authorizes and commits to a software project and it is probable that the project will be completed. Tasks that are generally capitalized are as follows: (a) system design of a chosen path including software configuration and software interfaces; (b) employee costs directly associated with the internal-use computer software project; (c) software development (coding) and software and system testing and verification; (d) system installation; and (e) enhancements that add function and are considered permanent. These tasks are capitalized and amortized using the straight line method over its estimated useful life, which range from three to ten years and is included in depreciation and amortization in the consolidated statements of income (loss) and comprehensive income (loss). | |
Software and Maintenance Contracts | |
Software and maintenance contracts are recorded at cost. Amortization of software and maintenance contracts is computed using the straight-line method and expensed over their estimated useful lives which range from one to five years and are recognized in cost of revenues in the consolidated statements of income (loss) and comprehensive income (loss). | |
Software and maintenance contracts are recognized as prepaid expenses and other assets or within other long-term assets depending on their remaining useful lives. | |
Goodwill and Other Intangible Assets | |
Goodwill represents the excess of the purchase price and related costs over the value assigned to net assets acquired. Goodwill is not amortized, but is tested for impairment at least annually, or more often if events or circumstances indicate there may be impairment. | |
For 2014, the Company used a “qualitative assessment” option or “step zero” for the goodwill impairment test for all of its reporting units. With this process, the Company first assesses whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount. If the answer is no, then the fair value of the reporting unit does not need to be measured, and step one and step two, as explained below, are bypassed. In assessing the fair value of a reporting unit, which is based on the nature of the business and reporting unit’s current and expected financial performance, the Company uses a combination of factors such as industry and market conditions, overall financial performance and the entity and reporting unit specific events. | |
In the past, the goodwill impairment test used was a two-step process at each reporting unit level. The first step used to identify potential impairment, compared the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeded its carrying amount, goodwill of the reporting unit was not considered impaired and the second step of the impairment test was unnecessary. If needed, the second step consisted of comparing the implied fair value of the reporting unit with the carrying amount of that goodwill. | |
For the years ended December 31, 2014, 2013 and 2012, no impairment losses associated with goodwill were recognized. | |
Other identifiable intangible assets with a definitive useful life are amortized using the straight-line method. These intangibles are evaluated periodically for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. | |
Other identifiable intangible assets with a definitive useful life were acquired during September 2010 when Apollo acquired a 51% indirect ownership interest in EVERTEC as part of a merger (the “Merger”) and include customer relationship, trademark, software packages and non-compete agreement. Customer relationship was valued using the excess earnings method under the income approach. Trademark was valued using the relief-from-royalty method under the income approach. Software packages, which include capitalized software development costs, were recorded at cost. Non-compete agreement was valued based on the estimated impact that theoretical competition would have on revenues and expenses. | |
Indemnification Assets | |
Indemnification assets represent the Company’s estimates of payments from Popular related to expected losses on services provided to certain common customers of the Company and Popular, and for certain incremental software and license costs expected to be incurred by the Company (see Note 19) during the five years following the Merger date. Indemnification assets are recorded at the fair value of the expected cash flows. The indemnification asset decreases by the payments received from Popular and is subsequently adjusted to reflect the asset at fair value. The fair value adjustment, if any, is included in current period earnings. As of December 31, 2014 and 2013, the Company’s indemnification related to the software amounted to $1.4 million and $3.6 million, respectively. The current portion of the indemnification assets is included within accounts receivable, net and the other long-term portion is included within other long-term assets in the accompanying consolidated balance sheets. During 2012, the agreement for reimbursement of expected costs with Popular expired. Therefore, no fair value was recorded as of December 31, 2014, 2013 or 2012. For the year ended December 31, 2012, the Company recorded a gain amounting to $1.0 million. The Company recorded a $0.4 million loss in 2014, a $0.4 million loss for 2013, and a gain of $33,000 for 2012, related to the software. | |
Income Tax | |
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of income (loss) and comprehensive income (loss) in the period that includes the enactment date. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. A deferred tax valuation allowance is established if it is considered more likely than not that all or a portion of the deferred tax asset will not be realized. | |
All companies within EVERTEC are legal entities which file separate income tax returns. | |
Cash | |
Cash includes cash on hand and in banks. | |
Restricted Cash | |
Restricted cash represents cash received on deposits from participating institutions of the ATH network that has been segregated for the development of the ATH brand. Also, restricted cash includes certain cash collected from the Ticketpop business and a reserve account for payment and transaction processing services to merchants. The restrictions of these accounts are based on contractual provisions entered into with third parties. This cash is maintained in separate accounts at a financial institution in Puerto Rico. | |
Allowance for Doubtful Accounts | |
An allowance for doubtful accounts is provided for based on the estimated uncollectible amounts of the related receivables. The estimate is primarily based on a review of the current status of specific accounts receivable. Receivables are considered past due if full payment is not received by the contractual date. Past due accounts are generally written off against the allowance for doubtful accounts only after all collection attempts have been exhausted. | |
Foreign Currency Translation | |
Assets and liabilities denominated in foreign currencies are translated to U.S. dollars using prevailing rates of exchange at the end of the period. Revenues, expenses, gains and losses are translated using weighted average rates for the period. The resulting foreign currency translation adjustment from operations for which the functional currency is other than the U.S. dollar is reported in accumulated other comprehensive income (loss). Gains and losses on transactions denominated in currencies other than the functional currencies are included in determining net income for the period in which exchange rates change. | |
Share-based Compensation | |
The Company estimates the fair value of stock-based awards, on a contemporaneous basis, at the date they are granted using the Black-Scholes-Merton option pricing model for Tranche A options and the Monte Carlo simulation analysis for Tranche B and Tranche C options using the following assumptions: (1) stock price; (2) risk-free rate; (3) expected volatility; (4) expected annual dividend yield and (5) expected term. The risk-free rate is based on the U.S. Constant Maturities Treasury Interest Rate as of the grant date. The expected volatility is based on a combination of historical volatility and implied volatility from publicly traded companies in the Company’s industry. The expected annual dividend yield is based on management’s expectations of future dividends as of the grant date. The expected term for stock options granted under the 2010 Plan was based on the vesting time of the options. For the stock options granted under the 2013 Plan, the simplified method was used to estimate the expected term, given that the Company does not have appropriate exercise data on which to base the estimate nor is exercise data relating to employees of comparable companies easily obtainable. | |
Upon option exercise, participants may elect to “net share settle”. Rather than requiring the participant to deliver cash to satisfy the exercise price and statutory minimum tax withholdings, the Company withholds a sufficient number of shares to cover these amounts and delivers the net shares to the participant. The Company recognizes the associated tax withholding obligation as a reduction of additional paid-in capital. | |
As compensation expense is recognized, a deferred tax asset is established. At the time stock options are exercised, a current tax deduction arises based on the value at the time of exercise. This deduction may exceed the associated deferred tax asset, resulting in a “windfall tax benefit”. The windfall is recognized in the consolidated balance sheet as an increase to additional paid-in capital, and is included in the consolidated statement of cash flows as a financing inflow. | |
In determining the amount of cash tax savings realized from the excess share-based compensation deductions, the Company follows the tax law ordering approach. Under this approach, the utilization of excess tax deductions associated with share-based awards is dictated by provision in the tax law that identify the sequence in which such benefits are utilized for tax purposes. | |
Net Income (Loss) Per Common Share | |
Basic net income (loss) per common share is determined by dividing net income (loss) by the weighted-average number of common shares outstanding during the period. | |
Diluted net income (loss) per common share assumes the issuance of all potentially dilutive share equivalents using the treasury stock method. For stock options it is assumed that the proceeds will be used to buy back shares. Such proceeds equal the average unrecognized compensation plus exercise price and windfall tax benefits. For unvested restricted shares, the proceeds equal the average unrecognized compensation plus windfall tax benefits. |
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2014 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Note 2—Recent Accounting Pronouncements |
The Financial Accounting Standards Board (“FASB”) has issued the following accounting pronouncements and guidance relevant to the Company’s operations: | |
In May 2014, the FASB issued updated guidance for revenue recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: identify the contract(s) with a customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when (or as) the entity satisfies a performance obligation. The guidance also specifies the accounting for some costs to obtain or fulfill a contract with a customer. In addition, the updated guidance enhances and expands disclosures regarding revenue recognition. The amendments in this Update are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. The Company is currently evaluating the impact of the adoption of this guidance on its financial statements. | |
In August 2014, the FASB issued updated guidance relating to disclosures for uncertainties about an entity’s ability to continue as a going concern. The amendments require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this Update are effective for annual reporting periods ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The Company does not expect this guidance to have an impact on the financial statements when adopted. | |
In November 2014, the FASB issued updated guidance relating to pushdown accounting for business combinations. The amendments in this Update provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. An acquired entity may elect the option to apply pushdown accounting in the reporting period in which the change-in-control event occurs. An acquired entity should determine whether to elect to apply pushdown accounting for each individual change-in-control event in which an acquirer obtains control of the acquired entity. If pushdown accounting is not applied in the reporting period in which the change-in-control event occurs, an acquired entity will have the option to elect to apply pushdown accounting in a subsequent reporting period to the acquired entity’s most recent change-in-control event. An election to apply pushdown accounting in a reporting period after the reporting period in which the change-in-control event occurred should be considered a change in accounting principle in accordance with Topic 250, Accounting Changes and Error Corrections. If pushdown accounting is applied to an individual change-in-control event, that election is irrevocable. If an acquired entity elects the option to apply pushdown accounting in its separate financial statements, it should disclose information in the current reporting period that enables users of financial statements to evaluate the effect of pushdown accounting. The amendments in this Update are effective on November 18, 2014. For the year ended December 31, 2014, the adoption of this guidance did not have an impact on the consolidated financial statements. | |
In January 2015, the FASB issued updated guidance eliminating from GAAP the concept of extraordinary items. Subtopic 225-20, Income Statement—Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose extraordinary events and transactions. Presently, an event or transaction is presumed to be an ordinary and usual activity of the reporting entity unless evidence clearly supports its classification as an extraordinary item. Eliminating the concept of extraordinary items will save time and reduce costs for preparers because they will not have to assess whether a particular event or transaction event is extraordinary. This also alleviates uncertainty for preparers, auditors, and regulators because auditors and regulators no longer will need to evaluate whether a preparer treated an unusual and/or infrequent item appropriately. This Update will align more closely GAAP income statement presentation guidance with IAS 1, Presentation of Financial Statements, which prohibits the presentation and disclosure of extraordinary items. The amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. The effective date is the same for both public business entities and all other entities. The Company is currently evaluating the impact, if any, of the adoption of this guidance on its financial statements. | |
Cash
Cash | 12 Months Ended |
Dec. 31, 2014 | |
Cash and Cash Equivalents [Abstract] | |
Cash | Note 3—Cash |
At December 31, 2014 and 2013, the Company’s cash amounted to $32.1 million and $22.5 million, respectively, which is deposited in interest bearing deposit accounts within financial institutions. Cash deposited in an affiliate financial institution amounted to $7.8 million and $8.5 million as of December 31, 2014 and 2013, respectively. |
Accounts_Receivable_Net
Accounts Receivable, Net | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Receivables [Abstract] | |||||||||
Accounts Receivable, Net | Note 4—Accounts Receivable, Net | ||||||||
Accounts receivable, net consisted of the following: | |||||||||
December 31, | |||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||
Trade | $ | 53,503 | $ | 46,200 | |||||
Due from affiliates, net | 13,140 | 12,030 | |||||||
Settlement assets | 9,868 | 11,157 | |||||||
Other | 306 | 69 | |||||||
Less: allowance for doubtful accounts | (1,007 | ) | (1,022 | ) | |||||
Accounts receivable, net | $ | 75,810 | $ | 68,434 | |||||
The Company records settlement assets that result from timing differences in the Company’s settlement processes with merchants, financial institutions, and credit card associations related to merchant and card transaction processing. The amounts are generally collected or paid the following business day. |
Prepaid_Expenses_and_Other_Ass
Prepaid Expenses and Other Assets | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||
Prepaid Expenses and Other Assets | Note 5—Prepaid Expenses and Other Assets | ||||||||
Prepaid expenses and other assets consisted of the following: | |||||||||
December 31, | |||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||
Taxes other than income | $ | 1,102 | $ | 859 | |||||
Software licenses and maintenance contracts | 7,028 | 6,570 | |||||||
Prepaid income taxes | 3,726 | 5,278 | |||||||
Postage | 709 | 1,675 | |||||||
Insurance | 1,321 | 1,120 | |||||||
Deferred project costs | 3,040 | 1,958 | |||||||
Other | 3,639 | 2,022 | |||||||
Prepaid expenses and other assets | $ | 20,565 | $ | 19,482 | |||||
Investment_in_Equity_Investee
Investment in Equity Investee | 12 Months Ended |
Dec. 31, 2014 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Equity Investee | Note 6—Investment in Equity Investee |
CONTADO is the largest merchant acquirer and ATM network in the Dominican Republic. The Company uses the equity method of accounting to account for its equity interest in CONTADO. As a result of the acquisition in 2011 of CONTADO’s 19.99% equity interest, the Company preliminarily calculated an excess cost of the investment in CONTADO over the amount of underlying equity in net assets of approximately $9.0 million, which was mainly attributed to customer relationships, trademark and goodwill intangibles. The Company’s excess basis allocated to amortizable assets is recognized on a straight-line basis over the lives of the appropriate intangibles. Amortization expense for the years ended December 31, 2014, 2013 and 2012 amounted to approximately $0.3 million, $0.3 million and $0.4 million, respectively, was recorded as earnings of equity method investments in the consolidated statements of income (loss) and comprehensive income (loss). The Company recognized $1.1 million, $0.9 million and $0.6 million as equity in CONTADO’s net income, net of amortization, in the consolidated statements of income (loss) and comprehensive income (loss) for the years ended December 31, 2014, 2013 and 2012, respectively. For the years ended December 31, 2014, 2013 and 2012, the Company received $0.3 million, $1.0 million and $1.6 million, respectively in dividends from CONTADO. | |
CONTADO fiscal year ends December 31 and is reported in the consolidated statements of income (loss) and comprehensive income (loss) for the period subsequent to the acquisition date on a one month lag. No significant event occurred in these operations subsequent to November 30, 2014 that would have materially affected the Company’s reported results. | |
Property_and_Equipment_Net
Property and Equipment, Net | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||
Property and Equipment, Net | Note 7—Property and Equipment, Net | ||||||||||
Property and equipment, net consisted of the following: | |||||||||||
Useful life | December 31, | ||||||||||
(Dollar amounts in thousands) | in years | 2014 | 2013 | ||||||||
Buildings | 30 | $ | 1,602 | $ | 1,726 | ||||||
Data processing equipment | 3 - 5 | 77,588 | 68,273 | ||||||||
Furniture and equipment | 3 - 20 | 7,540 | 6,385 | ||||||||
Leasehold improvements | 5 - 10 | 2,964 | 2,880 | ||||||||
89,694 | 79,264 | ||||||||||
Less—accumulated depreciation and amortization | (61,580 | ) | (47,555 | ) | |||||||
Depreciable assets, net | 28,114 | 31,709 | |||||||||
Land | 1,421 | 1,531 | |||||||||
Property and equipment, net | $ | 29,535 | $ | 33,240 | |||||||
Depreciation and amortization expense related to property and equipment was $15.5 million, $16.2 million and $16.4 million for the years ended December 31, 2014, 2013 and 2012, respectively. |
Goodwill
Goodwill | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||
Goodwill | Note 8—Goodwill | ||||||||||||||||
The changes in the carrying amount of goodwill, allocated by reportable segments, were as follows (See Note 21): | |||||||||||||||||
(Dollar amounts in thousands) | Merchant | Payment | Business | Total | |||||||||||||
acquiring, net | processing | solutions | |||||||||||||||
Balance at December 31, 2011 | $ | 138,121 | $ | 186,470 | $ | 47,121 | $ | 371,712 | |||||||||
Foreign currency translation adjustments | — | 558 | 37 | 595 | |||||||||||||
Balance at December 31, 2012 | 138,121 | 187,028 | 47,158 | 372,307 | |||||||||||||
Foreign currency translation adjustments | — | 594 | 218 | 812 | |||||||||||||
Balance at December 31, 2013 | 138,121 | 187,622 | 47,376 | 373,119 | |||||||||||||
Foreign currency translation adjustments | — | (3,394 | ) | (888 | ) | (4,282 | ) | ||||||||||
Balance at December 31, 2014 | $ | 138,121 | $ | 184,228 | $ | 46,488 | $ | 368,837 | |||||||||
Goodwill is tested for impairment on an annual basis, or more often if events or circumstances indicate there may be impairment, using the qualitative assessment option or step zero process. Using this process, the Company first assesses whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount. | |||||||||||||||||
During the third quarter of 2014, the Company conducted a qualitative assessment of each reporting unit’s fair value as of August 31, 2014. As part of the Company’s qualitative assessment, EVERTEC considered the results for the Company’s 2011 impairment test (which indicated that the fair value of each reporting unit was in excess of 30% of its carrying amount) as well as current market conditions and changes in the carrying amount of the Company’s reporting units that occurred subsequent to the 2011 impairment test. Based on the results of this qualitative assessment, EVERTEC believes the fair value of goodwill for each of the Company’s reporting units continues to exceed their respective carrying amounts and concluded that it was not necessary to conduct the two-step goodwill impairment test. Accordingly, no impairment losses for the period were recognized. |
Other_Intangible_Assets
Other Intangible Assets | 12 Months Ended | ||||||||||||||
Dec. 31, 2014 | |||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||
Other Intangible Assets | Note 9—Other Intangible Assets | ||||||||||||||
The carrying amount of other intangible assets consisted of the following: | |||||||||||||||
December 31, 2014 | |||||||||||||||
(Dollar amounts in thousands) | Useful life in years | Gross | Accumulated | Net carrying | |||||||||||
amount | amortization | amount | |||||||||||||
Customer relationships | 14 | $ | 312,735 | $ | (95,482 | ) | $ | 217,253 | |||||||
Trademark | 10 - 15 | 39,950 | (14,722 | ) | 25,228 | ||||||||||
Software packages | 3 - 10 | 138,188 | (86,605 | ) | 51,583 | ||||||||||
Non-compete agreement | 15 | 56,539 | (16,019 | ) | 40,520 | ||||||||||
Other intangible assets, net | $ | 547,412 | $ | (212,828 | ) | $ | 334,584 | ||||||||
31-Dec-13 | |||||||||||||||
(Dollar amounts in thousands) | Useful life in years | Gross | Accumulated | Net carrying | |||||||||||
amount | amortization | amount | |||||||||||||
Customer relationships | 14 | $ | 314,036 | $ | (73,180 | ) | $ | 240,856 | |||||||
Trademark | 10 - 15 | 39,950 | (11,258 | ) | 28,692 | ||||||||||
Software packages | 3 - 10 | 119,598 | (65,655 | ) | 53,943 | ||||||||||
Non-compete agreement | 15 | 56,539 | (12,250 | ) | 44,289 | ||||||||||
Other intangible assets, net | $ | 530,123 | $ | (162,343 | ) | $ | 367,780 | ||||||||
Amortization expense related to intangibles was $50.5 million, $54.2 million and $55.1 million for the years ended December 31, 2014, 2013 and 2012, respectively. Amortization expense related to software costs was $21.0 million, $24.5 million and $25.4 million for the years ended December 31, 2014, 2013 and 2012, respectively. The estimated amortization expenses of balances outstanding at December 31, 2014 for the next five years are as follows: | |||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||
2015 | $ | 48,083 | |||||||||||||
2016 | 38,025 | ||||||||||||||
2017 | 34,879 | ||||||||||||||
2018 | 32,392 | ||||||||||||||
2019 | 31,593 |
Other_LongTerm_Assets
Other Long-Term Assets | 12 Months Ended |
Dec. 31, 2014 | |
Text Block [Abstract] | |
Other Long-Term Assets | Note 10—Other Long-Term Assets |
As of December 31, 2014, other long-term assets included $9.3 million related to deferred debt-issuance costs and $1.6 million related to the long-term portion of certain software and maintenance contracts. | |
As of December 31, 2013, other long-term assets included $11.5 million related to deferred debt-issuance costs, $1.7 million related to the long-term portion of certain indemnification asset (See Note 19) and $5.0 million related to the long-term portion of certain software and maintenance contracts. |
Debt_and_ShortTerm_Borrowings
Debt and Short-Term Borrowings | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | |||||||||
Debt and Short-Term Borrowings | Note 11—Debt and Short-Term Borrowings | ||||||||
Total debt was as follows: | |||||||||
December 31, | |||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||
Senior Secured Credit Facility (Term A) due on April 17, 2018 paying interest at a variable interest rate (London InterBank Offered Rate (“LIBOR”) plus applicable margin (1)(3)) | $ | 277,239 | $ | 292,153 | |||||
Senior Secured Credit Facility (Term B) due on April 17, 2020 paying interest at a variable interest rate (LIBOR plus applicable margin (2)(3)) | 389,340 | 392,527 | |||||||
Senior Secured Revolving Credit Facility expiring on April 17, 2018 paying interest at a variable interest rate | 23,000 | 50,000 | |||||||
Other short-term borrowing | — | 1,200 | |||||||
Note Payable due on October 1, 2017 (3) | 4,333 | — | |||||||
Total debt | $ | 693,912 | $ | 735,880 | |||||
-1 | Applicable margin of 2.50% at December 31, 2014 and 2013. | ||||||||
(2) | Subject to a minimum rate (“LIBOR floor”) of 0.75% plus applicable margin of 2.75% at December 31, 2014 and 2013. | ||||||||
(3) | Includes unamortized discount. | ||||||||
Senior Secured Credit Facilities | |||||||||
On April 17, 2013, EVERTEC Group entered into a credit agreement (the “2013 Credit Agreement”) governing the senior secured credit facilities, consisting of a $300.0 million term loan A facility (the “Term A Loan”) which matures on April 17, 2018, a $400.0 million term loan B facility (the “Term B Loan”) which matures on April 17, 2020 and a $100.0 million revolving credit facility which matures on April 17, 2018. The net proceeds received by EVERTEC Group from the new senior secured credit facilities, together with other cash available to EVERTEC Group, were used to, among other things, refinance EVERTEC Group’s previous senior secured credit facilities and redeem a portion of the senior notes, as further described below. | |||||||||
As a result of the debt refinancing, EVERTEC Group’s previous senior secured credit facilities were evaluated under ASC 470-50, Debtor’s Accounting for a Modification or Exchange of Debt Instruments. Accordingly, a portion of the unamortized discount and debt issue costs amounting to $6.4 million and $5.9 million, respectively, were treated as a modification and is amortized over the term of the new debt using the interest method. The remaining unamortized discount and debt issue costs of $3.4 million and $3.0 million, respectively, were considered to be related to the portion of the debt that was extinguished and written-off. | |||||||||
Senior Notes | |||||||||
On March 29, 2013, EVERTEC Group provided notice to Wilmington Trust, National Association (the “Trustee”) pursuant to the Indenture, dated as of September 30, 2010 (as supplemented by Supplemental Indenture No. 1, dated as of April 17, 2012, Supplemental Indenture No. 2, dated as of May 7, 2012 and Supplemental Indenture No. 3, dated as of May 7, 2012) between EVERTEC Group and EVERTEC Finance Corp. (together, the “Co-Issuers”), the Guarantors named therein and the Trustee (the “Indenture”), that the Co-Issuers had elected to (i) redeem $91.0 million principal amount of their outstanding senior notes, at a redemption price of 111.0%, plus accrued and unpaid interest, on April 29, 2013 (the “Partial Redemption”) and (ii) redeem all of their outstanding senior notes (after giving effect to the redemption of $91.0 million principal amount of the senior notes described in clause (i)) at a redemption price of 100.0% plus a make-whole premium and accrued and unpaid interest, on April 30, 2013 (the “Full Redemption”). On April 17, 2013, the Co-Issuers and the Trustee entered into a Satisfaction and Discharge Agreement whereby EVERTEC Group caused to be irrevocably deposited with the Trustee, to satisfy and to discharge the Co-Issuers’ obligations under the Indenture (a) a portion of the net cash proceeds received by the Company in the initial public offering to Holdings, which contributed such proceeds to EVERTEC Group, in an amount sufficient to effect the Partial Redemption on April 29, 2013 and (b) proceeds from the 2013 Credit Agreement described above in an amount sufficient to effect the Full Redemption on April 30, 2013. On April 29, 2013, the Partial Redemption was effected and on April 30, 2013, the Full Redemption was effected. | |||||||||
Based on accounting guidance, the senior notes were considered extinguished. Accordingly, the outstanding premium of $1.8 million and unamortized debt issuance costs of $7.0 million were written-off and presented as a loss on extinguishment of debt. In addition, the redemption premium payments totaling $41.9 million were accounted for as a loss on extinguishment of debt. | |||||||||
Senior Secured Credit Facilities | |||||||||
Term A Loan | |||||||||
As of December 31, 2014, the outstanding principal amount of the Term A Loan was $277.5 million. The Term A Loan requires principal payments on the last business day of each quarter equal to (a) 1.250% of the original principal amount commencing on September 30, 2013 through June 30, 2016; (b) 1.875% of the original principal amount from September 30, 2016 through June 30, 2017; (c) 2.50% of the original principal amount from September 30, 2017 through March 31, 2018; and (d) the remaining outstanding principal amount on the maturity of the Term A Loan on April 17, 2018. Interest is based on EVERTEC Group’s first lien secured net leverage ratio and payable at a rate equal to, at the Company’s option, either (a) LIBOR Rate plus an applicable margin ranging from 2.00% to 2.50%, or (b) Base Rate plus an applicable margin ranging from 1.00% to 1.50%. Term A Loan has no LIBOR Rate or Base Rate minimum or floor. | |||||||||
Term B Loan | |||||||||
As of December 31, 2014, the outstanding principal amount of the Term B Loan was $394.0 million. The Term B Loan requires principal payments on the last business day of each quarter equal to 0.250% of the original principal amount commencing on September 30, 2013 and the remaining outstanding principal amount on the maturity of the Term B Loan on April 17, 2020. Interest is based on EVERTEC Group’s first lien secured net leverage ratio and payable at a rate equal to, at the Company’s option, either (a) LIBOR Rate plus an applicable margin ranging from 2.50% to 2.75%, or (b) Base Rate plus an applicable margin ranging from 1.50% to 1.75%. The LIBOR Rate and Base Rate are subject to floors of 0.75% and 1.75%, respectively. | |||||||||
Revolving Credit Facility | |||||||||
The revolving credit facility has an available balance up to $100.0 million, with an interest rate on loans calculated the same as the applicable Term A Loan rate. The facility matures on April 17, 2018 and has a “commitment fee” payable one business day after the last business day of each quarter calculated based on the daily unused commitment during the preceding quarter. The commitment fee for the unused portion of this facility ranges from 0.125% to 0.375% and is based on EVERTEC Group’s first lien secured net leverage ratio. As of December 31, 2014, the outstanding balance of the revolving credit facility was $23.0 million. | |||||||||
All loans may be prepaid without premium or penalty. | |||||||||
The senior secured credit facilities were evaluated under accounting guidance and accordingly, $7.2 million of debt issue costs were capitalized and are being amortized over the term of the new debt using the interest method and $4.9 million of debt issue costs were expensed and are presented in the Company’s financial statements as a loss on the extinguishment of debt. | |||||||||
The senior secured credit facilities contain various restrictive covenants. The Term A Loan and the revolving credit facility (subject to certain exceptions) require the Company to maintain on a quarterly basis a specified maximum senior secured leverage ratio of up to 6.60 to 1.00 as defined in the 2013 Credit Agreement (total first lien secured debt to adjusted EBITDA). In addition, the 2013 Credit Agreement, among other things: (a) limits the Company’s ability and the ability of the Company’s subsidiaries to incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments and enter into certain transactions with affiliates; (b) restricts the Company’s ability to enter into agreements that would restrict the ability of the Company’s subsidiaries to pay dividends or make certain payments to EVERTEC; and (c) places restrictions on the Company’s ability and the ability of the Company’s subsidiaries to merge or consolidate with any other person or sell, assign, transfer, convey or otherwise dispose of all or substantially all of the Company’s assets. As of December 31, 2014, the Company was in compliance with the applicable restrictive covenants under the 2013 Credit Agreement. | |||||||||
Other short-term borrowing | |||||||||
In August 2013, EVERTEC entered into a financing agreement in the ordinary course of business to purchase certain hardware, software, maintenance and related services in the amount of $1.8 million to be repaid in three installments over a term of eight months. As of December 31, 2014, this other short-term borrowing had been fully repaid. | |||||||||
Note payable | |||||||||
In December 2014, EVERTEC entered into a non-interest bearing $4.6 million financing agreement to purchase softwares. The note will be repaid over a 36-month term in twelve quarterly installments. Prepayment penalties apply. As of December 31, 2014 the outstanding principal balance of this note payable is $4.6 million. The current portion of this note is recorded as part of accounts payable and the long-term portion is included in other long-term liabilities. |
Financial_Instruments_and_Fair
Financial Instruments and Fair Value Measurements | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Financial Instruments and Fair Value Measurements | Note 12—Financial Instruments and Fair Value Measurements | ||||||||||||||||
Recurring Fair Value Measurements | |||||||||||||||||
Fair value measurement provisions establish a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These provisions describe three levels of input that may be used to measure fair value: | |||||||||||||||||
Level 1: Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. | |||||||||||||||||
Level 2: Inputs, other than quoted prices included in Level 1, that are observable for the asset or liability through corroboration with market data at the measurement date. | |||||||||||||||||
Level 3: Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. | |||||||||||||||||
The Company uses observable inputs when available. Fair value is based upon quoted market prices when available. If market prices are not available, the Company may employ internally-developed models that mostly use market-based inputs including yield curves, interest rates, volatilities, and credit curves, among others. The Company limits valuation adjustments to those deemed necessary to ensure that the financial instrument’s fair value adequately represents the price that would be received or paid in the marketplace. Valuation adjustments may include consideration of counterparty credit quality and liquidity as well as other criteria. The estimated fair value amounts are subjective in nature and may involve uncertainties and matters of significant judgment for certain financial instruments. Changes in the underlying assumptions used in estimating fair value could affect the results. The fair value measurement levels are not indicative of risk of investment. | |||||||||||||||||
The following table summarizes fair value measurements by level at December 31, 2014 and 2013, for assets measured at fair value on a recurring basis: | |||||||||||||||||
(Dollar amounts in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
December 31, 2014 | |||||||||||||||||
Financial assets: | |||||||||||||||||
Indemnification assets: | |||||||||||||||||
Software cost reimbursement | $ | — | $ | — | $ | 1,428 | $ | 1,428 | |||||||||
December 31, 2013 | |||||||||||||||||
Financial assets: | |||||||||||||||||
Indemnification assets: | |||||||||||||||||
Software cost reimbursement | $ | — | $ | — | $ | 3,586 | $ | 3,586 | |||||||||
The fair value of financial instruments is the amount at which an asset or obligation could be exchanged in a current transaction between willing parties, other than in a forced liquidation sale. Fair value estimates are made at a specific point in time based on the type of financial instrument and relevant market information. Many of these estimates involve various assumptions and may vary significantly from amounts that could be realized in actual transactions. | |||||||||||||||||
For those financial instruments with no quoted market prices available, fair values have been estimated using present value calculations or other valuation techniques, as well as management’s best judgment with respect to current economic conditions, including discount rates and estimates of future cash flows. | |||||||||||||||||
Indemnification assets include the present value of the expected future cash flows of certain expense reimbursement agreements with Popular. These contracts have termination dates up to September 2015 and were entered into in connection with the merger transaction completed on September 30, 2010 (“the Merger”). Management prepared estimates of the expected reimbursements to be received from Popular until the termination of the contracts, discounted the estimated future cash flows and recorded the indemnification assets as of the Merger closing date. Payments received during the quarters reduced the indemnification asset balance. The remaining balance was adjusted to reflect its fair value as of December 31, 2014 and 2013, therefore resulting in a net unrealized loss of $0.4 million in both periods, and a net unrealized gain of $1.0 million for the year ended December 31, 2012, which are reflected within the other expenses caption in the consolidated statements of income (loss) and comprehensive income (loss). The current portion of the indemnification assets is included within accounts receivable, net and the other long-term portion is included within other long-term assets in the accompanying consolidated balance sheets. See Note 19 for additional information regarding the expense reimbursement agreements. | |||||||||||||||||
The unobservable inputs related to the Company’s indemnification assets as of December 31, 2014 using the discounted cash flow model include the discount rate of 4.75% and the projected cash flows of $1.4 million. | |||||||||||||||||
For indemnification assets a significant increase or decrease in market rates and cash flows could result in a significant impact to the fair value. Also, the credit rating and/or the non-performance credit risk of Popular, which is subjective in nature, also could increase or decrease the sensitivity of the fair value of these assets. | |||||||||||||||||
The following table presents the carrying value, as applicable, and estimated fair values for financial instruments at December 31, 2014 and 2013: | |||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
(Dollar amounts in thousands) | Carrying | Fair | Carrying | Fair | |||||||||||||
Amount | Value | Amount | Value | ||||||||||||||
Financial assets: | |||||||||||||||||
Indemnification assets: | |||||||||||||||||
Software cost reimbursement | $ | 1,428 | $ | 1,428 | $ | 3,586 | $ | 3,586 | |||||||||
Financial liabilities: | |||||||||||||||||
Senior secured term loan A | $ | 277,240 | $ | 266,400 | $ | 292,153 | $ | 284,091 | |||||||||
Senior secured term loan B | 389,340 | 385,462 | 392,527 | 387,055 | |||||||||||||
The fair value of the new senior secured term loans at December 31, 2014 and 2013 was obtained using the prices provided by third party service providers. Their pricing is based on various inputs such as: market quotes, recent trading activity in a non-active market or imputed prices. Also, the pricing may include the use of an algorithm that could take into account movement in the general high yield market, among other variants. | |||||||||||||||||
The senior secured term loans, which are not measured at fair value in the balance sheets, if measured, could be categorized as Level 3 in the fair value hierarchy. | |||||||||||||||||
The following table provides a summary of the change in fair value of the Company’s Level 3 assets: | |||||||||||||||||
(Dollar amounts in thousands) | Indemnification | ||||||||||||||||
Assets | |||||||||||||||||
Balance—December 31, 2011 | $ | 7,464 | |||||||||||||||
Payments received | (2,331 | ) | |||||||||||||||
Unrealized loss recognized in other expenses | 966 | ||||||||||||||||
Balance—December 31, 2012 | $ | 6,099 | |||||||||||||||
Payments received | (2,130 | ) | |||||||||||||||
Unrealized gain recognized in other expenses | (383 | ) | |||||||||||||||
Balance—December 31, 2013 | $ | 3,586 | |||||||||||||||
Payments received | (1,712 | ) | |||||||||||||||
Unrealized loss recognized in other expenses | (446 | ) | |||||||||||||||
Balance—December 31, 2014 | $ | 1,428 | |||||||||||||||
There were no transfers in or out of Level 3 during the years ended December 31, 2014, 2013 and 2012. |
Equity
Equity | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Equity [Abstract] | |||||||||
Equity | Note 13—Equity | ||||||||
The Company is authorized to issue up to 206,000,000 shares of common stock of $0.01 par value. At December 31, 2014 and 2013, the Company had 77,893,144 and 78,286,465 shares outstanding, respectively. The Company is also authorized to issue 2,000,000 shares of $0.01 par value preferred stock. As of December 31, 2014, no shares of preferred stock have been issued. | |||||||||
Initial Public Offering and Other Public Offerings | |||||||||
On April 17, 2013, EVERTEC completed an initial public offering of 28,789,943 shares of common stock at a price to the public of $20.00 per share. A total of 6,250,000 shares were offered by EVERTEC and a total of 22,539,943 shares were offered by selling stockholders, of which 13,739,284 shares were sold by Apollo and 8,800,659 shares were sold by Popular. EVERTEC used the net proceeds of approximately $117.4 million, after the deduction of underwriting discount and commissions, from the Company’s sale of shares in the initial public offering and proceeds from borrowings under the 2013 Credit Agreement, together with available cash on hand, to redeem the Company’s senior notes and to refinance the Company’s previous senior secured credit facilities. | |||||||||
On September 18, 2013, EVERTEC completed a public offering of 23,000,000 shares of the Company’s common stock by Apollo, Popular, and current and former employees at a price to the public of $22.50 per share. EVERTEC did not receive any proceeds from this offering. | |||||||||
On December 13, 2013, EVERTEC completed a public offering of 15,233,273 shares of the Company’s common stock by Apollo, Popular, and current and former employees at a price to the public of $20.60 per share. EVERTEC did not receive any proceeds from this offering. | |||||||||
Stock Repurchase | |||||||||
During the fourth quarter of 2014, the Company repurchased 1,201,194 shares of the Company’s common stock at a cost of $26.2 million. The Company funded such repurchase with cash on hand and borrowings to the existing revolving credit facility. | |||||||||
On December 13, 2013, the Company repurchased 3,690,036 shares of its common stock. The Company funded the share repurchase with approximately $25.0 million in cash on hand and approximately $50.0 million of borrowings under its revolving credit facility. | |||||||||
Dividends | |||||||||
During 2013, the Company implemented a policy under which EVERTEC pays a regular quarterly dividend on the Company’s common stock, subject to the declaration thereof each quarter by the Company’s Board of Directors. The Company’s dividend activity in 2014 and 2013 was as follows: | |||||||||
Declaration Date | Record Date | Payment Date | Dividend per share | ||||||
August 7, 2013 | August 19, 2013 | September 6, 2013 | $ | 0.1 | |||||
November 6, 2013 | November 18, 2013 | 6-Dec-13 | 0.1 | ||||||
February 12, 2014 | 25-Feb-14 | 14-Mar-14 | 0.1 | ||||||
May 7, 2014 | 19-May-14 | 6-Jun-14 | 0.1 | ||||||
August 6, 2014 | 18-Aug-14 | 5-Sep-14 | 0.1 | ||||||
November 5, 2014 | 17-Nov-14 | 5-Dec-14 | 0.1 | ||||||
On December 18, 2012, the Company’s Board of Directors declared a special dividend of approximately $53.4 million to its stockholders. The Company recorded excess over accumulated earnings of the cash distribution amounting to $52.4 million as a return of capital reducing additional paid in capital caption in the consolidated balance sheets. | |||||||||
On May 9, 2012, the Company used the net proceeds primarily from the incremental of the previous term loan, together with cash on hand, to pay a special cash dividend of $269.8 million to its stockholders. The Company recorded the excess over accumulated earnings of the cash distribution amounting to $260.2 million as a return of capital reducing additional paid in capital caption in the consolidated balance sheets. |
Sharebased_Compensation
Share-based Compensation | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||
Share-based Compensation | Note 14—Share-based Compensation | ||||||||||||||||||||||||
Equity Incentive Plans | |||||||||||||||||||||||||
On September 30, 2010, the Holdings Board of Directors adopted the Carib Holdings, Inc. 2010 Equity Incentive Plan (the “2010 Plan”) to grant stock options, rights to purchase shares, restricted stock units and other stock-based rights to employees, directors, consultants and advisors. On April 17, 2012, in connection with the Reorganization, EVERTEC, Inc. assumed the 2010 Plan and all of the outstanding equity awards issued thereunder or subject thereto. EVERTEC, Inc. reserved 5,843,208 shares of its common stock for issuance upon exercise and grants of stock options, restricted stock and other equity awards under the 2010 Plan. | |||||||||||||||||||||||||
In connection with the Company’s initial public offering, the Company adopted the EVERTEC, Inc. 2013 Equity Incentive Plan (the “2013 Plan” and, together with the 2010 Plan, the “Equity Incentive Plans”). Under the 2013 Plan, 5,956,882 shares of its common stock are reserved for issuance upon exercise and grants of stock options, restricted stocks and other equity awards. In connection with the adoption of the 2013 Plan, the 2010 Plan remains in effect. However, no new awards will be granted under the 2010 Plan. The Equity Incentive Plans have a contractual term of ten years. | |||||||||||||||||||||||||
The following table summarizes the stock options activity for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||||||||||||||
Shares | Weighted-average | ||||||||||||||||||||||||
exercise prices (1) | |||||||||||||||||||||||||
Outstanding at December 31, 2011 | 5,388,548 | $ | 1.3 | ||||||||||||||||||||||
Granted (2) | 1,020,000 | 4.95 | |||||||||||||||||||||||
Forfeitures | (1,230,966 | ) | 1.3 | ||||||||||||||||||||||
Outstanding at December 31, 2012 | 5,177,582 | $ | 2.06 | ||||||||||||||||||||||
Granted | 150,000 | 23.36 | |||||||||||||||||||||||
Exercised (3) | (4,042,046 | ) | 1.99 | ||||||||||||||||||||||
Outstanding at December 31, 2013 | 1,285,536 | $ | 4.77 | ||||||||||||||||||||||
Granted | 100,000 | 24.01 | |||||||||||||||||||||||
Forfeitures | (31,164 | ) | 1.3 | ||||||||||||||||||||||
Exercised (3) | (945,040 | ) | 1.96 | ||||||||||||||||||||||
Repurchased | (93,332 | ) | 4.83 | ||||||||||||||||||||||
Outstanding at December 31, 2014 | 316,000 | $ | 19.56 | ||||||||||||||||||||||
Exercisable at December 31, 2014 | 50,000 | $ | 23.36 | ||||||||||||||||||||||
(1) | Exercise price was retroactively adjusted to reflect the equitable adjustment of $3.71 per share as discussed below. | ||||||||||||||||||||||||
(2) | Includes 100,000 of stock options that were not granted under the Equity Incentive Plans, but are subject to certain terms of the 2010 Plan. | ||||||||||||||||||||||||
(3) | At December 31, 2014, the total intrinsic value of options exercised during the year amounted to $19.3 million. | ||||||||||||||||||||||||
In connection with the cash dividend declared on December 18, 2012, the Board of Directors of EVERTEC, Inc. approved an equitable adjustment to stock options previously granted as required by the 2010 Plan payable in form of a one-time cash bonus to holders of vested options for shares of common stock in the amount of $0.69 per share, which in the case of vested options was on December 21, 2012 and in the case of unvested options will be paid in the future as the options vest, subject to certain conditions. Accordingly, $2.8 million was recognized as other long-term liabilities related the accrual of the unvested portion of the stock options as of December 31, 2012. As of December 31, 2014 and 2013, the accrual of the unvested portion of stock options related to this equitable adjustment amounted to approximately $45,000 and $0.6 million, respectively. | |||||||||||||||||||||||||
As a result of the cash dividend, on May 9, 2012, the Board of Directors of EVERTEC, Inc. approved an equitable adjustment to stock options previously granted as required by its 2010 Plan in order to reduce the exercise price of the outstanding options granted under or subject to the terms of the 2010 Plan by $3.71 per share. This adjustment to the exercise price did not impact the compensation expense recognized by the Company for the year ended December 31, 2012 or the maximum unrecognized cost. | |||||||||||||||||||||||||
The following table presents information about fully vested stock options for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Shares | Weighted | Shares | Weighted | Shares | Weighted | ||||||||||||||||||||
average | average | average | |||||||||||||||||||||||
exercise price | exercise price | exercise price | |||||||||||||||||||||||
Vested stock options (1)(2)(3) | 766,995 | $ | 3.75 | 3,757,099 | $ | 2.07 | 279,750 | $ | 1.3 | ||||||||||||||||
(1) | At December 31, 2014, 2013 and 2012, the aggregate intrinsic value amounted to $14.0 million, $84.9 million and $1.6 million, respectively. | ||||||||||||||||||||||||
(2) | The weighted average contractual term of fully vested options is 6.06 years, 7.04 years and 7.85 years as of December 31, 2014, 2013 and 2012, respectively. | ||||||||||||||||||||||||
(3) | The fair value of vested stock options at December 31, 2014, 2013 and 2012 amounted to $17.0 million, $92.7 million and $2.0 million, respectively. | ||||||||||||||||||||||||
Management uses the fair value method of recording stock-based compensation as described in the guidance for stock compensation in ASC topic 718. The fair value of stock options granted during 2014, 2013 and 2012 was estimated using the Black-Scholes-Merton (“BSM”) option pricing model, with the following assumptions: | |||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Stock options granted | Stock options granted | Stock options granted | |||||||||||||||||||||||
under the 2013 Plan | under the 2013 Plan | under the 2010 Plan | |||||||||||||||||||||||
Stock Price (1) | $ | 24.01 per share | $ | 23.36 per share | $ | 5.19 per share | |||||||||||||||||||
Risk-free rate | 1.8 | % | 1.68 | % | 0.59 | % | |||||||||||||||||||
Expected volatility | 36.98 | % | 36.56 | % | 31.12 | % | |||||||||||||||||||
Expected annual dividend yield | 1.63 | % | 1.71 | % | 0 | % | |||||||||||||||||||
Expected term | 6 years | 6 years | 3.87 years | ||||||||||||||||||||||
(1) | As discussed above, on May 9, 2012 an equitable adjustment to stock options was approved which caused a reduction of $3.71 per share of the exercise price of the outstanding options. Accordingly, the stock price presented above reflects this equitable adjustment for 2012. | ||||||||||||||||||||||||
The risk-free rate is based on the U.S. Constant Maturities Treasury Interest Rate as of the grant date. The expected volatility is based on a combination of historical volatility and implied volatility from public trade companies in the Company’s industry. The expected annual dividend yield is based on management’s expectations of future dividends as of the grant date. The expected term for stock options granted under the 2010 Plan was based on the vesting time of the options. For the stock options granted under the 2013 Plan, the simplified method was used to estimate the expected term. | |||||||||||||||||||||||||
The following table summarizes the nonvested restricted shares activity for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||||||||||||||
Nonvested restricted shares | Shares | Weighted-average | |||||||||||||||||||||||
grant date fair value | |||||||||||||||||||||||||
Nonvested at December 31, 2011 | 126,116 | $ | 5 | ||||||||||||||||||||||
Granted | 29,292 | 8.54 | |||||||||||||||||||||||
Vested | (39,988 | ) | 5 | ||||||||||||||||||||||
Nonvested at December 31, 2012 | 115,420 | $ | 5.9 | ||||||||||||||||||||||
Granted | 9,133 | 24.64 | |||||||||||||||||||||||
Vested | (115,420 | ) | 5.9 | ||||||||||||||||||||||
Nonvested at December 31, 2013 | 9,133 | $ | 24.64 | ||||||||||||||||||||||
Granted | 23,252 | 22.04 | |||||||||||||||||||||||
Vested | (9,133 | ) | 24.64 | ||||||||||||||||||||||
Nonvested at December 31, 2014 | 23,252 | $ | 22.04 | ||||||||||||||||||||||
During the third quarter of 2014, the Company granted to four of its directors and to an executive officer restricted stock units under the 2013 Plan. | |||||||||||||||||||||||||
Share-based compensation recognized was as follows: | |||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||||||||||||||
Share-based compensation recognized, net | |||||||||||||||||||||||||
Stock options | $ | 4,305 | $ | 5,820 | $ | 595 | |||||||||||||||||||
Restricted shares | 282 | 359 | 609 | ||||||||||||||||||||||
Pursuant to the terms of the 2010 Plan, Tranche A stock options will generally vest in five equal installments, except for some grants as specified in the stock agreement, Tranche B options granted to employees and certain directors would vest at such time as the Investor Internal Rate of Return (“IRR”) equals or exceeds 25%, except for one grant that vests upon a 20% IRR, based on cash proceeds received by Apollo Investment Fund VII, L.P. (the “Investor”), and Tranche C options would vest at such time as the IRR equals or exceeds 30% based on cash proceeds received by the Investor. | |||||||||||||||||||||||||
As a result of the Initial Public Offering, the IRR required by the Tranche B and C options was achieved and accordingly, all Tranche B and C options became vested. As a result, the Company recognized a share-based compensation expense of $4.9 million in April 2013. | |||||||||||||||||||||||||
The share-based compensation expense related to the stock options amounting to $1.3 million is expected to be recognized over a weighted average period of 1.96 years. | |||||||||||||||||||||||||
The maximum unrecognized cost for restricted stock units was $0.4 million as of December 31, 2014. The cost is expected to be recognized over a weighted average period of 1.59 years. |
Employee_Benefit_Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2014 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Benefit Plan | Note 15—Employee Benefit Plan |
EVERTEC, Inc. Puerto Rico Savings and Investment plan (“the EVERTEC Savings Plan”) was established, as a defined contribution savings plan qualified under section 1165(e) of the Puerto Rico Internal Revenue Code. Investments in the plan are participant directed, and employer matching contributions are determined based on specific provisions of the EVERTEC Savings Plan. Employees are fully vested in the employer’s contributions after five years of service. For the years ended December 31, 2014, 2013 and 2012, the costs incurred under the plan amounted to approximately $0.6 million for each of all periods. |
Total_Other_Income_Expenses
Total Other Income (Expenses) | 12 Months Ended |
Dec. 31, 2014 | |
Other Income and Expenses [Abstract] | |
Total Other Income (Expenses) | Note 16—Total Other Income (Expenses) |
For the year ended December 31, 2014, other income (expenses) is primarily comprised of $2.6 million in foreign currency transaction gains and a $0.4 million in expenses related to adjustments made to software indemnification assets as a result of certain maintenance contract cancellations during the year. | |
For the year ended December 31, 2013, other expenses are primarily comprised of a $58.5 million charge related to the extinguishment of debt (see Note 11) and a $16.7 million expense related to the termination of the Company’s consulting agreements with Apollo and Popular (see Note 19). | |
For the year ended December 31, 2012, other expenses primarily comprised of $8.8 million associated with the issuance of additional debt and $2.2 million of personnel separation charges, partially offset by $1.3 related to a gain in foreign exchange transactions of Latin America operations. |
Income_Tax
Income Tax | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Income Tax | Note 17—Income Tax | ||||||||||||
On April 17, 2012, EVERTEC Group was converted from a Puerto Rico corporation into a Puerto Rico limited liability company in order to take advantage of recent changes to the PR Code that allow limited liability companies to be treated as partnerships that are pass-through entities for Puerto Rico tax purposes. As a result of the Conversion, EVERTEC Group’s taxable income from its Puerto Rico operations flows through to its direct parent company and therefore to EVERTEC, Inc. | |||||||||||||
EVERTEC Group, Holdings and EVERTEC, Inc. entered into a Tax Payment Agreement pursuant to which EVERTEC Group is obligated to make certain payments to Holdings or EVERTEC, Inc. for taxable periods or portions thereof occurring on or after April 17, 2012 (the “Effective Date”). Under the Tax Payment Agreement, EVERTEC Group will make payments with respect to any and all taxes (including estimated taxes) imposed under the laws of Puerto Rico, the United States of America and any other jurisdiction or any political (including municipal) subdivision or authority or agency in Puerto Rico, the United States of America or such other jurisdiction, that would have been imposed on EVERTEC Group if EVERTEC Group had been a corporation for tax purposes of that jurisdiction, together with all interest and penalties with respect thereto (“Taxes”), reduced by taking into account any applicable net operating losses or other tax attributes of Holdings or EVERTEC, Inc. that reduce Holdings’ or EVERTEC, Inc.’s taxes in such period. The Tax Payment Agreement provides that the payments thereunder shall not exceed the net amount of Taxes that Holdings and EVERTEC, Inc. actually owe to the appropriate taxing authority for a taxable period. Further, the Tax Payment Agreement provides that if Holdings or EVERTEC, Inc. receives a tax refund attributable to any taxable period or portion thereof occurring on or after the Effective Date, EVERTEC, Inc. shall be required to recalculate the payment for such period required to be made by EVERTEC Group to Holdings or EVERTEC, Inc. If the payment, as recalculated, is less than the amount of the payment EVERTEC Group already made to Holdings or EVERTEC, Inc. in respect of such period, Holdings or EVERTEC, Inc. shall promptly make a payment to EVERTEC Group in the amount of such difference. | |||||||||||||
The components of income tax benefit consisted of the following: | |||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Current tax provision | $ | 9,291 | $ | 3,712 | $ | 6,910 | |||||||
Deferred tax benefit | (1,713 | ) | (5,702 | ) | (66,568 | ) | |||||||
Income tax expense (benefit) | $ | 7,578 | $ | (1,990 | ) | $ | (59,658 | ) | |||||
For the year ended December 31, 2012, the Company recognized a reduction of $66.4 million of its deferred tax liability as a result of a tax grant received from the Government of Puerto Rico that reduced the Company’s marginal corporate income tax rate from 30% to 4% on industrial development income. | |||||||||||||
The Company conducts operations in Puerto Rico and certain countries throughout the Caribbean and Latin America. As a result, the income tax benefit includes the effect of taxes paid to the Puerto Rico government as well as foreign jurisdictions. The following table presents the segregation of income tax benefit based on location of operations: | |||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Income (loss) before income tax provision (benefit) | |||||||||||||
Puerto Rico | 61,395 | (35,255 | ) | 9,941 | |||||||||
United States | 2,131 | 2,031 | 1,534 | ||||||||||
Foreign countries | 11,584 | 6,613 | 6,233 | ||||||||||
Total income (loss) before income tax provision (benefit) | $ | 75,110 | $ | (26,611 | ) | $ | 17,708 | ||||||
Current tax provision (benefit) | |||||||||||||
Puerto Rico | $ | 4,779 | $ | 913 | $ | 4,661 | |||||||
United States | (517 | ) | 753 | 622 | |||||||||
Foreign countries | 5,029 | 2,046 | 1,627 | ||||||||||
Total current tax provision | $ | 9,291 | $ | 3,712 | $ | 6,910 | |||||||
Deferred tax benefit | |||||||||||||
Puerto Rico | $ | 56 | $ | (5,094 | ) | $ | (65,822 | ) | |||||
United States | (124 | ) | (5 | ) | (38 | ) | |||||||
Foreign countries | (1,645 | ) | (603 | ) | (708 | ) | |||||||
Total deferred tax benefit | $ | (1,713 | ) | $ | (5,702 | ) | $ | (66,568 | ) | ||||
Taxes payable to foreign countries by EVERTEC’s subsidiaries will be paid by such subsidiary and the corresponding liability and expense will be presented in EVERTEC’s consolidated financial statements. | |||||||||||||
On June 30, 2013, the Governor of Puerto Rico signed into law Act 40, effective as of January 1, 2013, which increased the maximum corporate income tax rate from 30% to 39%. This rate increase is only applicable to the fully taxable operations of EVERTEC in Puerto Rico. As a result of this tax rate increase, the deferred taxes were revalued resulting in the Company recognizing additional non-cash income tax expense of $1.4 million for the first half of 2013. In addition, Act 40 established a national gross receipts tax based on gross revenues that is included as part of the alternative minimum tax calculation. | |||||||||||||
As of December 31, 2014, the Company has reported $22 million of unremitted earnings for foreign subsidiaries in the consolidated balance sheet. The Company had not recognized a deferred tax liability on undistributed earnings for the Company’s foreign subsidiaries, because these earnings are intended to be permanently reinvested. The amount of the unrecognized deferred tax liability depends on judgment required to analyze the withholding tax due, the applicable tax law and factual circumstances in effect at the time of any such distributions, therefore, EVERTEC believes it is not practicable at this time to reliably determine the amount of unrecognized deferred tax liability related to the Company’s undistributed earnings. If circumstances change and it becomes apparent that some or all of the undistributed earnings of a subsidiary will be remitted and income taxes have not been recognized by the parent entity, the parent entity shall accrue as an expense of the current period income taxes attributable to that remittance. | |||||||||||||
On October 19, 2012, EVERTEC Group was granted an additional tax exemption under the Tax Incentive Act No. 73 of 2008. Under this grant, EVERTEC Group will benefit from a preferential income tax rate on industrial development income, as well as from tax exemptions with respect to its municipal and property tax obligations for certain activities derived from its data processing operations in Puerto Rico. The grant has a term of 15 years effective as of January 1, 2012 with respect to income tax obligations and January 1, 2013 with respect to municipal and property tax obligations. | |||||||||||||
The grant establishes a base taxable income amount with respect to EVERTEC Group’s industrial development income, which amount will continue to be subject to the ordinary income tax rate under existing law. Applicable taxable income in excess of the established base taxable income amount will be subject to a preferential rate of 4%. The base taxable income amount will be ratably reduced to zero by the fourth taxable year at which point all of EVERTEC Group’s applicable industrial development income will be taxed at the preferential rate of 4% for the remaining period of the grant. The grant also establishes a 90% exemption on certain real and property taxes and a 60% exemption on municipal taxes, in each case imposed on EVERTEC Group. In addition, distributions to stockholders by EVERTEC, Inc. of the industrial development income will not be subject to Puerto Rico tollgate taxes. | |||||||||||||
The grant contains customary commitments, conditions and representations that EVERTEC Group will be required to comply with in order to maintain the grant. The more significant commitments include: (i) maintaining at least 750 employees in EVERTEC Group’s Puerto Rico data processing operations during 2012 and at least 700 employees for the remaining years of the grant; and (ii) investing at least $200.0 million in building, machinery, equipment or computer programs to be used in Puerto Rico during the effective term of the grant (to be made over four year capital investment cycles in $50.0 million increments). Failure to meet the requirements could result, among other things, in reductions in the benefits of the grant or revocation of the grant in its entirety, which could result in EVERTEC, Inc. paying additional taxes or other payments relative to what such parties would be required to pay if the full benefits of the grant are available. In addition, the protection from Puerto Rican tollgate taxes on distributions to stockholders may be lost. | |||||||||||||
On October 11, 2011, the Puerto Rico Government approved a grant under Tax Incentive Law No. 73 of 2008, retroactively to December 1, 2009. Under this grant, activities derived from consulting and data processing services provided outside Puerto Rico are subject to a preferred rate that declines gradually from 7% to 4% by December 1, 2013. After this date, the rate remains at 4% until its expiration in November 1, 2024. | |||||||||||||
In addition, EVERTEC Group has a base tax rate of 7% on income derived from certain development and installation service in excess of a determined income for a 10-year period from January 1, 2008. | |||||||||||||
The following table presents the components of the Company’s deferred tax assets and liabilities: | |||||||||||||
December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||||||
Deferred tax assets (“DTA”) | |||||||||||||
Allowance for doubtful accounts | $ | 346 | $ | 330 | |||||||||
Net operating loss | 7,076 | 11,306 | |||||||||||
Other temporary assets | 2,302 | 1,845 | |||||||||||
Total gross deferred tax assets | 9,724 | 13,481 | |||||||||||
Deferred tax liabilities (“DTL”) | |||||||||||||
Deferred compensation | $ | 1,145 | $ | 993 | |||||||||
Difference between the assigned values and the tax basis of assets and liabilities recognized in purchase | 24,735 | 28,849 | |||||||||||
Debt issue cost | 1,232 | 1,680 | |||||||||||
Other temporary liabilities | (314 | ) | 177 | ||||||||||
Total gross deferred tax liabilities | 26,798 | 31,699 | |||||||||||
Deferred tax liability, net | $ | (17,074 | ) | $ | (18,218 | ) | |||||||
Pursuant to the provision of the PR Code, net operating losses (“NOL”) can be carried forward for a period of seven, ten or twelve taxable years, depending on the taxable year generated. The Company incurred in NOLs during 2010 and 2013, which will expire in 2022 and in 2023, respectively. At December 31, 2014 the recorded value of the Company’s NOL carryforwards was $7.0 million. The recorded value of the Company’s NOL carryforwards is approximately $4.2 million lower than the total NOL carryforwards available to EVERTEC due to a windfall tax benefit. The windfall tax benefit is available to offset future taxable income and is considered an off-balance sheet item until the deduction reduces taxes payable. This windfall tax benefit results from tax deductions in excess of previously recorded compensation expense due to the difference in fair value of stock options at the time of the grant as compared to when they were exercised. The total gross NOL carryforwards available to EVERTEC, including the windfall tax benefit of $10.8 million, was $28.9 million as of December 31, 2014. | |||||||||||||
The Company recognizes in its financial statements the benefits of tax return positions if it is more likely than not to be sustained on audit based on its technical merits. On a quarterly basis, EVERTEC evaluates its tax positions and revises its estimates accordingly. There were no open uncertain tax positions as of December 31, 2014 or 2013 and accordingly the Company had no liability for unrecognized tax benefits. | |||||||||||||
The income tax expense (benefit) differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income (loss) before income taxes as a result of the following: | |||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Computed income tax at statutory rates | $ | 29,293 | $ | (10,378 | ) | $ | 5,313 | ||||||
Benefit of net tax-exempt interest income | — | (180 | ) | (13 | ) | ||||||||
Tax expense (benefit) due to a change in estimate | (916 | ) | 83 | 320 | |||||||||
Adjustment to deferred taxes due to changes in enacted tax rate and tax grant | 485 | 1,441 | (66,423 | ) | |||||||||
Effect of net disallowed operating losses in foreign entities | 83 | 93 | 1,012 | ||||||||||
Differences in tax rates due to multiple jurisdictions | (942 | ) | 577 | 720 | |||||||||
Effect of income subject to tax-exemption grant | (20,425 | ) | 7,164 | (58 | ) | ||||||||
Reversal of tax uncertainties reserve | — | (846 | ) | (707 | ) | ||||||||
Fair value adjustment of indemnification assets | — | — | 340 | ||||||||||
Other | — | 56 | (162 | ) | |||||||||
Income tax expense (benefit) | $ | 7,578 | $ | (1,990 | ) | $ | (59,658 | ) | |||||
There were no open uncertain tax positions as of December 31, 2014 or 2013. |
Net_Income_Loss_Per_Common_Sha
Net Income (Loss) Per Common Share | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Earnings Per Share [Abstract] | |||||||||||||
Net Income (Loss) Per Common Share | Note 18—Net Income (Loss) Per Common Share | ||||||||||||
The reconciliation of the numerator and the denominator of the earnings per common share is as follows: | |||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands, except per share data) | 2014 | 2013 | 2012 | ||||||||||
Net income (loss) | $ | 67,532 | $ | (24,621 | ) | $ | 77,366 | ||||||
Weighted average common shares outstanding | 78,337,152 | 78,914,310 | 72,687,622 | ||||||||||
Weighted average potential dilutive common shares (1)(2) | 553,987 | — | 3,948,795 | ||||||||||
Weighted average common shares outstanding—assuming dilution | 78,891,139 | 78,914,310 | 76,636,417 | ||||||||||
Net income (loss) per common share—basic | $ | 0.86 | $ | (0.31 | ) | $ | 1.06 | ||||||
Net income (loss) per common share—diluted | $ | 0.86 | $ | (0.31 | ) | $ | 1.01 | ||||||
(1) | Potential common shares consist of common stock issuable under the assumed exercise of stock options and restricted stock awards using the treasury stock method. | ||||||||||||
(2) | For the year ended December 31, 2013, 2,325,209 potential common shares consisting of common stock under the assumed exercise of stock options and restricted stock awards using the treasury stock method were not included in the computation of the diluted net income (loss) per share since their inclusion would have an antidilutive effect. | ||||||||||||
Refer to Note 13 for a detail of dividends declared and paid during 2014 and 2013. |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Related Party Transactions [Abstract] | |||||||||||||
Related Party Transactions | Note 19—Related Party Transactions | ||||||||||||
The following table presents the Company’s transactions with related parties for each of the periods presented below: | |||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Total revenues (1)(2) | $ | 164,142 | $ | 167,325 | $ | 155,112 | |||||||
Cost of revenues | $ | 1,342 | $ | 8,290 | $ | 426 | |||||||
Rent and other fees (3)(4) | $ | 7,928 | $ | 27,762 | $ | 11,319 | |||||||
Interest earned from and charged by affiliate | |||||||||||||
Interest income | $ | 197 | $ | 130 | $ | 222 | |||||||
Interest expense (5) | $ | — | $ | 2,471 | $ | 7,476 | |||||||
(1) | Total revenues from Popular as a percentage of revenues were 45%, 46% and 44% for each of the periods presented above. | ||||||||||||
(2) | Includes revenues generated from investee accounted for under the equity method of $2.5 million, $3.0 million and $3.7 million for the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||||||
-3 | Includes management fees to equity sponsors amounting to $3.5 million and $3.7 million for the years ended December 31, 2013 and 2012, respectively. Management fees paid during 2013 also includes $16.7 million resulting from the termination of the consulting agreements as explained below. Rent and other fees also include $5.9 million paid in connection with the redemption premium on the senior notes during the first half of 2013. | ||||||||||||
(4) | Includes $7.9 million, $11.1 million and $11.3 million recorded as selling, general and administrative expenses for each of the periods presented above, and $16.7 million recorded as non-operating expenses for the year ended December 31, 2013 in the audited consolidated statement of income (loss) and comprehensive income (loss). | ||||||||||||
(5) | Interest expense relates to interest accrued on the senior secured term loan and senior notes held by Popular. As a result of the debt refinancing and the redemption of the senior notes in April 2013, Popular’s participation in such debt was extinguished. See Note 11 for additional information related to the extinguishment of this debt. | ||||||||||||
On April 17, 2013, EVERTEC entered into a termination agreement with Holdings, EVERTEC Group and Popular and a termination agreement with Holdings, EVERTEC Group and Apollo Management VII, L.P. in connection with the initial public offering (the “Termination Agreements”). The Termination Agreements terminated the consulting agreements (the “Consulting Agreements”), each dated September 30, 2010, entered into by Holdings and EVERTEC Group with each of Popular and Apollo Management, pursuant to which Holdings and EVERTEC Group received certain advisory services from each of Popular and Apollo Management. The Consulting Agreements were terminated in their entirety upon payment of termination fees of approximately $8.5 million to Apollo Management and $8.2 million to Popular, in each case, plus any unreimbursed expenses payable in accordance with the terms of the Termination Agreements. | |||||||||||||
At December 31, 2014 and 2013, the Company had the following balances arising from transactions with related parties: | |||||||||||||
December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||||||
Cash and restricted cash deposits in affiliated bank | $ | 13,566 | $ | 13,933 | |||||||||
Indemnification assets from Popular reimbursement (1) | |||||||||||||
Accounts receivable | $ | 1,428 | $ | 1,900 | |||||||||
Other long-term assets | $ | — | $ | 1,686 | |||||||||
Other due/to from affiliate | |||||||||||||
Accounts receivable | $ | 17,006 | $ | 18,799 | |||||||||
Prepaid expenses and other assets | $ | 1,141 | $ | 216 | |||||||||
Accounts payable (2) | $ | 5,260 | $ | 8,886 | |||||||||
Unearned income | $ | 8,154 | $ | 4,100 | |||||||||
Other long-term liabilities (2) | $ | 45 | $ | 333 | |||||||||
-1 | Recorded in connection with reimbursement from Popular regarding certain software license fees. | ||||||||||||
(2) | Includes an account payable of $0.2 million for both December 31, 2014 and 2013 and a long-term liability of $45,000 and $0.3 million for December 31, 2014 and 2013, respectively, related to the unvested portion of stock options as a result of the equitable adjustment approved by the Company’s Board of Directors on December 18, 2012 that will be payable to executive officers and employees upon vesting of stock options. | ||||||||||||
The balance of cash and restricted cash deposits in an affiliated bank was included within the cash and restricted cash line items in the accompanying consolidated balance sheets. Due from affiliates mainly included the amounts outstanding related to processing and information technology services billed to Popular subsidiaries according to the terms of the Master Services Agreement (“MSA”) under which EVERTEC Group has a contract to provide such services for at least 15 years on an exclusive basis for the duration of the agreement on commercial terms consistent with historical pricing practices among the parties. This amount was included in the accounts receivable, net in the consolidated balance sheets. | |||||||||||||
The Company is entitled to receive reimbursements from Popular regarding certain software license fees if such amounts exceed certain amounts for a period of five years from the closing date of the Merger. As a result of this agreement, the Company recorded approximately $11.2 million as a software reimbursement asset at fair value as of the Merger date. At December 31, 2014 and 2013, the current portion of said asset of $1.4 million and $1.9 million, respectively, is included within the accounts receivable, net caption and the long-term portion of $1.7 million as of December 31, 2013, none in 2014, is included in the other long-term assets caption in the accompanying consolidated balance sheets. Gains and losses related to the asset are included within the other expenses caption in the accompanying consolidated statements of income (loss) and comprehensive income (loss). See Note 12 and 16. | |||||||||||||
From time to time, EVERTEC Group obtains performance bonds from insurance companies covering the obligations of EVERTEC Group under certain contracts. Under the Merger Agreement, Popular is required to, subject to certain exceptions, cause the then outstanding performance bonds to remain outstanding or replace such bonds as needed for five years from the closing date of the Merger. EVERTEC Group entered into a reimbursement agreement with Popular to mirror Popular’s obligations. As a result, EVERTEC Group is required to reimburse Popular for payment of premiums and related charges and indemnification of Popular for certain losses, in case EVERTEC Group fails to perform or otherwise satisfy its obligations covered by such performance bonds. | |||||||||||||
As of December 31, 2014, EVERTEC Group has a credit facility with Popular for $3.6 million, on behalf of EVERTEC CR, under which a letter of credit of a similar amount was issued. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||
Commitments and Contingencies | Note 20—Commitments and Contingencies | ||||||||||||
The Company leases certain facilities and equipment under operating leases. Most leases contain renewal options for varying periods. Future minimum rental payments on such operating leases at December 31, 2014 are as follows: | |||||||||||||
(Dollar amounts in thousands) | Unrelated | Related party | Minimum | ||||||||||
parties | future rentals | ||||||||||||
2015 | $ | 625 | $ | 4,100 | $ | 4,725 | |||||||
2016 | 356 | 4,226 | 4,582 | ||||||||||
2017 | 118 | 4,352 | 4,470 | ||||||||||
2018 | — | 4,483 | 4,483 | ||||||||||
2019 and thereafter | — | 5,780 | 5,780 | ||||||||||
$ | 1,099 | $ | 22,941 | $ | 24,040 | ||||||||
Certain lease agreements contain provisions for future rent increases. The total amount of rental payments due over the lease term is being charged to rent expense on the straight-line method over the term of the lease. The difference between rent expense recorded and the amount paid is recorded as a deferred rent obligation. | |||||||||||||
Rent expense of office facilities and real estate for the years ended December 31, 2014 and 2013 amounted to $8.2 million and $7.7 million, respectively. Also, rent expense for telecommunications and other equipment for the years ended December 31, 2014 and 2013 amounted to $6.1 million and $7.0 million, respectively. | |||||||||||||
In the ordinary course of business, the Company may enter in commercial commitments. As of December 31, 2014, EVERTEC has an outstanding letter of credit of $1.0 million with a maturity of less than three months. | |||||||||||||
EVERTEC is a defendant in a number of legal proceedings arising in the ordinary course of business. Based on the opinion of legal counsel, management believes that the final disposition of these matters will not have a material adverse effect on the business, results of operations or financial condition of the Company. The Company has identified certain claims in which a loss may be incurred, but in the aggregate the loss would be minimal. For other claims, where the proceedings are in an initial phase, the Company is unable to estimate the range of possible loss for such legal proceedings. However, the Company at this time believes that any loss related to these latter claims will not be material. |
Segment_Information
Segment Information | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||
Segment Information | Note 21—Segment Information | ||||||||||||||||||||
The Company operates in three business segments: Merchant Acquiring, Payment Processing and Business Solutions. | |||||||||||||||||||||
The Merchant Acquiring segment consists of revenues from services that allow merchants to accept electronic methods of payment. In the Merchant Acquiring segment, revenues include a discount fee and membership fees charged to merchants, debit network fees and rental fees from POS devices and other equipment, net of credit card interchange and assessment fees charged by credit cards associations (such as VISA or MasterCard) or payment networks. The discount fee is generally a percentage of the transaction value. EVERTEC also charge merchants for other services that are unrelated to the number of transactions or the transaction value. | |||||||||||||||||||||
The Payment Processing segment revenues are comprised of revenues related to providing access to the ATH network and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. Payment Processing revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions) and electronic benefit transfer (“EBT”) (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). | |||||||||||||||||||||
For ATH network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. For EBT services, revenues are primarily derived from the number of beneficiaries on file. | |||||||||||||||||||||
In September 2012, the Company renamed the transaction processing segment to Payment Processing segment. The change of name does not constitute a change in the segment composition. | |||||||||||||||||||||
The Business Solutions segment consist of revenues from a full suite of business process management solutions in various product areas such as core bank processing, network hosting and management, IT professional services, business process outsourcing, item processing, cash processing, and fulfillment. Core bank processing and network services revenues are derived in part from a recurrent fee and from fees based on the number of accounts on file (i.e. savings or checking accounts, loans, etc.) or computer resources utilized. Revenues from other processing services within the Business Solutions segment are generally volume-based and depend on factors such as the number of accounts processed. In addition, EVERTEC are a reseller of hardware and software products and these resale transactions are generally one-time transactions. | |||||||||||||||||||||
The Company’s business segments are organized based on the nature of products and services. The Chief Operating Decision Maker (“CODM”) reviews their separate financial information to assess performance and to allocate resources. | |||||||||||||||||||||
Management evaluates the operating results of each of its reportable segments based upon revenues and operating income. Segment asset disclosure is not used by the CODM as a measure of segment performance since the segment evaluation is driven by earnings. As such, segment assets are not disclosed in the notes to the accompanying consolidated financial statements. | |||||||||||||||||||||
The following tables set forth information about the Company’s operations by its three business segments for the periods indicated: | |||||||||||||||||||||
(Dollar amounts in thousands) | Merchant | Payment | Business | Other | Total | ||||||||||||||||
Acquiring, net | Processing | Solutions | |||||||||||||||||||
Year ended December 31, 2014 | |||||||||||||||||||||
Revenues | $ | 79,136 | $ | 132,091 | $ | 176,570 | $ | (26,668 | )(1) | $ | 361,129 | ||||||||||
Income from operations | 34,348 | 59,882 | 47,587 | (44,469 | )(2) | 97,348 | |||||||||||||||
Year ended December 31, 2013 | |||||||||||||||||||||
Revenues | 73,616 | 125,610 | 184,297 | (25,506 | )(1) | 358,017 | |||||||||||||||
Income from operations | 35,376 | 54,429 | 42,430 | (46,474 | )(2) | 85,761 | |||||||||||||||
Year ended December 31, 2012 | |||||||||||||||||||||
Revenues | 69,591 | 116,825 | 177,292 | (21,218 | )(1) | 342,490 | |||||||||||||||
Income from operations | 33,836 | 53,682 | 39,845 | (47,717 | )(2) | 79,646 | |||||||||||||||
(1) | Represents the elimination of intersegment revenues for services provided by the Payment Processing segment to the Merchant Acquiring segment, and other miscellaneous intersegment revenues. | ||||||||||||||||||||
(2) | Primarily represents non-operating depreciation and amortization expenses generated as a result of the Merger and certain non-recurring fees and expenses. | ||||||||||||||||||||
The reconciliation of income from operations to consolidated net income (loss) is as follows: | |||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||||||||||
Segment income from operations | |||||||||||||||||||||
Merchant Acquiring | $ | 34,348 | $ | 35,376 | $ | 33,836 | |||||||||||||||
Payment Processing | 59,882 | 54,429 | 53,682 | ||||||||||||||||||
Business Solutions | 47,587 | 42,430 | 39,845 | ||||||||||||||||||
Total segment income from operations | 141,817 | 132,235 | 127,363 | ||||||||||||||||||
Merger related depreciation and amortization and other unallocated expenses (1) | (44,469 | ) | (46,474 | ) | (47,717 | ) | |||||||||||||||
Income from operations | $ | 97,348 | $ | 85,761 | $ | 79,646 | |||||||||||||||
Interest expense, net | (25,753 | ) | (37,625 | ) | (54,011 | ) | |||||||||||||||
Earnings of equity method investment | 1,140 | 935 | 564 | ||||||||||||||||||
Other expenses | 2,375 | (75,682 | ) | (8,491 | ) | ||||||||||||||||
Income tax (expense) benefit | (7,578 | ) | 1,990 | 59,658 | |||||||||||||||||
Net income (loss) | $ | 67,532 | $ | (24,621 | ) | $ | 77,366 | ||||||||||||||
(1) | Primarily represents non-operating depreciation and amortization expenses generated as a result of the Merger and certain non-recurring fees and expenses. | ||||||||||||||||||||
The geographic segment information below is classified based on the geographic location of the Company’s subsidiaries: | |||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||||||||||
Revenues (1) | |||||||||||||||||||||
Puerto Rico | $ | 312,569 | $ | 309,350 | $ | 295,285 | |||||||||||||||
Caribbean | 13,752 | 16,225 | 16,280 | ||||||||||||||||||
Latin America | 34,808 | 32,442 | 30,925 | ||||||||||||||||||
Total revenues | $ | 361,129 | $ | 358,017 | $ | 342,490 | |||||||||||||||
(1) | Revenues are based on subsidiaries’ country of domicile. | ||||||||||||||||||||
Major customers | |||||||||||||||||||||
For the years ended December 31, 2014, 2013 and 2012, the Company had one major customer which accounted for approximately $161.6 million or 45%, $163.8 million or 46% and $151.4 million or 44%, respectively, of total revenues. See Note 19. | |||||||||||||||||||||
The Company’s next largest customer, the Government of Puerto Rico, consolidating all individual agencies and public corporations, represented 10%, 11% and 9% of the Company’s total revenues for the years ended December 31, 2014, 2013 and 2012, respectively. |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 22—Subsequent Events |
On February 18, 2015, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.10 per share on the Company’s outstanding shares of common stock. The Board anticipates declaring this dividend in future quarters on a regular basis; however future declarations of dividends are subject to board of director approval and may be adjusted as business needs or market conditions change. The cash dividend of $0.10 per share will be paid on March 19, 2015 to stockholders of record as of the close of business on March 2, 2015. |
Schedule_I_Condensed_Financial
Schedule I - Condensed Financial Statements Parent Company Only | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |||||||||||||
Schedule I - Condensed Financial Statements Parent Company Only | Schedule I | ||||||||||||
EVERTEC, Inc. Condensed Financial Statements | |||||||||||||
Parent Company Only | |||||||||||||
Condensed Balance Sheets | |||||||||||||
December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||||||
Assets | |||||||||||||
Current assets: | |||||||||||||
Cash | $ | 1,612 | $ | 1,285 | |||||||||
Accounts receivable, net | 3,224 | — | |||||||||||
Prepaid expenses and other assets | 3,690 | 11,574 | |||||||||||
Deferred tax asset | — | 2,494 | |||||||||||
Total current assets | 8,526 | 15,353 | |||||||||||
Investment in subsidiaries, at equity | 123,017 | 111,931 | |||||||||||
Total assets | $ | 131,543 | $ | 127,284 | |||||||||
Liabilities and stockholders’ equity | |||||||||||||
Current liabilities: | |||||||||||||
Accrued liabilities | $ | 49 | $ | 1,309 | |||||||||
Accounts Payable | 5 | — | |||||||||||
Deferred tax liability | 1,421 | — | |||||||||||
Total current liabilities | 1,475 | 1,309 | |||||||||||
Long-term deferred tax liability, net | 10,451 | 14,312 | |||||||||||
Other long-term liabilities | 44 | 333 | |||||||||||
Total liabilities | 11,970 | 15,954 | |||||||||||
Stockholders’ equity: | |||||||||||||
Common stock | 779 | 783 | |||||||||||
Additional paid-in capital | 59,740 | 80,718 | |||||||||||
Accumulated earnings | 65,576 | 29,403 | |||||||||||
Accumulated other comprehensive income (loss), net of tax of $0 and $0 | (6,522 | ) | 426 | ||||||||||
Total stockholders’ equity | 119,573 | 111,330 | |||||||||||
Total liabilities and stockholders’ equity | $ | 131,543 | $ | 127,284 | |||||||||
Condensed Statements of Income and Comprehensive Income | |||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Non-operating income (expenses) | |||||||||||||
Equity in earnings (losses) of subsidiaries | $ | 74,134 | $ | (23,668 | ) | $ | 95,382 | ||||||
Interest income | 227 | 144 | 5 | ||||||||||
Other expenses | (1,994 | ) | (4,780 | ) | (375 | ) | |||||||
Total non-operating income (expense) | 72,367 | (28,304 | ) | 95,012 | |||||||||
Income (loss) before income taxes | 72,367 | (28,304 | ) | 95,012 | |||||||||
Income tax expense (benefit) | 4,835 | (3,684 | ) | 17,646 | |||||||||
Net income (loss) | 67,532 | (24,621 | ) | 77,366 | |||||||||
Other comprehensive income (loss), net of tax | |||||||||||||
Foreign currency translation adjustments | (6,948 | ) | 1,268 | 476 | |||||||||
Total comprehensive income (loss) | $ | 60,584 | $ | (23,353 | ) | $ | 77,842 | ||||||
Condensed Statements of Cash Flows | |||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Cash flows from operating activities | $ | 57,276 | $ | (5,322 | ) | $ | 317,389 | ||||||
Cash flows from financing activities | |||||||||||||
Proceeds from initial public offering, net of offering costs of $12,567 | — | 112,432 | — | ||||||||||
Dividends paid | (31,359 | ) | (16,390 | ) | (319,959 | ) | |||||||
Repurchase of common stock | (26,197 | ) | (75,000 | ) | — | ||||||||
Statutory minimum withholding taxes paid on cashless exercises of stock options | (2,001 | ) | (16,851 | ) | — | ||||||||
Tax windfall benefits on exercises of stock options and vesting of restricted stocks | 3,669 | 1,829 | — | ||||||||||
Issuance of common stock | 543 | 29 | 450 | ||||||||||
Settlement of stock options | (1,604 | ) | — | — | |||||||||
Net cash (used in) provided by financing activities | (56,949 | ) | 6,049 | (319,509 | ) | ||||||||
Net increase (decrease) in cash | 327 | 727 | (2,120 | ) | |||||||||
Cash at beginning of the period | 1,285 | 557 | 2,677 | ||||||||||
Cash at end of the period | $ | 1,612 | $ | 1,285 | $ | 557 | |||||||
Supplemental disclosure of non-cash activities: | |||||||||||||
Transfer of prepaid income taxes from subsidiary | $ | — | $ | — | $ | 6,719 | |||||||
Liability related to unvested portion of stock options as a result of equitable adjustment (Note 14) | — | — | 3,151 | ||||||||||
On March 13, 2014, June 5, 2014, September 4, 2014 and December 4, 2014, the parent company received cash distributions from Holdings for the payment of dividends to its stockholders’ amounting to $7.8 million, $7.8 million, $7.9 million and $7.8 million, respectively. On October 1, 2014, the parent company received a $25.0 million dividend from Holdings which was used in the repurchase of 1,146,870 shares of its common stock. | |||||||||||||
On both August 31, 2013 and December 1, 2013, the parent company received cash distributions from Holdings of $8.2 million and used the proceeds of such distributions to pay dividends to its stockholders. On December 18, 2013, the parent company received a dividend from Holdings of approximately $75.0 million. The proceeds from this dividend were used in the repurchase of 3,690,036 shares of its common stock. | |||||||||||||
On December 18, 2012, the parent company received a cash distribution from Holdings of approximately $50.3 million and used the proceeds of such distribution to pay a dividend to its stockholders and to pay an equitable adjustment to holders of vested options. The Board of Directors approved an equitable adjustment to stock options payable in form of a one-time cash bonus to holders of vested options and in the case of unvested options will be paid as the options vest. On May 9, 2012, the parent company received a cash distribution from Holdings of approximately $269.8 million and used the proceeds of such distribution to pay a dividend to its stockholders. The Board of Directors approved an equitable adjustment to stock options in order to reduce the exercise price of the outstanding stock options. |
The_Company_and_Summary_of_Sig1
The Company and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Accounting Policies [Abstract] | |
The Company | The Company |
EVERTEC, Inc. (formerly known as Carib Latam Holdings, Inc.) and its subsidiaries (collectively the “Company,” or “EVERTEC”) is the leading full-service transaction processing business in Latin America and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment processing and business process management services across 19 countries in the region. EVERTEC owns and operates the ATH network, one of the leading automated teller machine (“ATM”) and personal identification number (“PIN”) debit networks in Latin America. In addition, EVERTEC provides a comprehensive suite of services for core bank processing, cash processing and technology outsourcing in the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations and government agencies with “mission-critical” technology solutions that are essential to their operations, enabling them to issue, process and accept transactions securely. Management believes that the Company’s business is well-positioned to continue to expand across the fast-growing Latin American region. | |
Initial Public Offering and Other Public Offerings | Initial Public Offering and Other Public Offerings |
On April 17, 2013, the Company completed its initial public offering of 28,789,943 shares of common stock at a price to the public of $20.00 per share. A total of 6,250,000 shares were offered by the Company and a total of 22,539,943 shares were offered by selling stockholders, of which 13,739,284 shares were sold by an affiliate of Apollo Global Management, LLC (“Apollo”) and 8,800,659 shares were sold by Popular, Inc. (“Popular”). The Company used the net proceeds of approximately $117.4 million, after the deduction of underwriting discount and commissions, from the sale of shares in the initial public offering and proceeds from borrowings under the 2013 Credit Agreement (as defined below), together with available cash on hand, to redeem the Company’s 11.0% senior notes due 2018 (the “senior notes”) and to refinance the Company’s previous senior secured credit facilities. | |
On September 18, 2013, the Company completed a public offering of 23,000,000 shares of the Company’s common stock by Apollo, Popular, and current and former employees at a price to the public of $22.50 per share. EVERTEC did not receive any proceeds from this offering. After the completion of the offering, Apollo owned approximately 9.2 million shares of EVERTEC’s common stock, or 11.2%, and Popular owned approximately 17.5 million shares of EVERTEC’s common stock, or 21.3%. | |
On December 13, 2013, the Company completed a public offering of 15,233,273 shares of its common stock by Apollo, Popular, and current and former employees at a price to the public of $20.60 per share. EVERTEC did not receive any proceeds from this offering. After the completion of the offering, Popular owned approximately 11.7 million shares of EVERTEC’s common stock, or 14.9%, and Apollo no longer owns any of the Company’s common stock. | |
Basis of Presentation | Basis of Presentation |
The consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, the accompanying consolidated financial statements, prepared in accordance with GAAP, contain all adjustments, all of which are normal and recurring in nature, necessary for a fair presentation. All significant intercompany accounts and transactions have been eliminated in consolidation. | |
Certain reclassifications have been made to the consolidated financial statements and related notes to conform with the presentation in 2014. | |
A summary of the most significant accounting policies used in preparing the accompanying consolidated financial statements is as follows: | |
Principles of Consolidation | Principles of Consolidation |
The accompanying consolidated financial statements include the accounts and operations of the Company, which are presented in accordance with GAAP. The Company consolidates all entities that are controlled by ownership of a majority voting interest. All significant intercompany accounts and transactions are eliminated in the consolidated financial statements. | |
Use of Estimates | Use of Estimates |
The preparation of the accompanying consolidated financial statements 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 financial statements and the reported amounts of revenues and expenses during the reporting period. | |
Revenue Recognition | Revenue Recognition |
The Company’s revenue recognition policy follows the guidance from Accounting Standards Codification (“ASC”) 605 Revenue Recognition; ASC 605-25, Revenue Recognition-Multiple Element Arrangements; and; ASC 985, Software, which provide guidance on the recognition, presentation, and disclosure of revenue in financial statements. | |
The Company recognizes revenue when the following four criteria are met: (i) persuasive evidence of an agreement exists, (ii) delivery and acceptance has occurred or services have been rendered, (iii) the selling price is fixed or determinable, and (iv) collection is reasonably assured. For multiple deliverable arrangements, EVERTEC evaluates each arrangement to determine if the elements or deliverables within the arrangement represent separate units of accounting pursuant to ASC 605-25. If the deliverables are determined to be separate units of accounting, revenues are recognized as these are delivered and revenue recognition criteria are met. If the deliverables are not determined to be separate units of accounting, revenues for the delivered services are combined into one unit of accounting and recognized (i) over the life of the arrangement if all services are consistently delivered over such term, or if otherwise, (ii) at the time that all services and deliverables have been delivered. The selling price for each deliverable is based on vendor specific objective evidence (“VSOE”) if available, third party evidence (“TPE”) if VSOE is not available, or management best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. EVERTEC establishes VSOE of selling price using the price charged when the same element is sold separately. EVERTEC bifurcates or allocates the arrangement consideration to each of the deliverables based on the relative selling price of each unit of accounting. | |
The Company has two main categories of revenues according to the type of transactions EVERTEC enters into with the Company’s customers: (a) transaction-based fees and (b) fixed fees and time and material. | |
Transaction-based fees | |
The Company provides services that generate transaction-based fees. Typically transaction-based fees depend on factors such as number of accounts or transactions processed. These factors typically consist of a fee per transaction or item processed, a percentage of dollar volume processed or a fee per account on file, or some combination thereof. Revenue derived from the transaction-based fee contracts are recognized when the underlying transaction is processed, which constitutes delivery of service. | |
Revenues from business contracts in the Company’s Merchant Acquiring segment are primarily comprised of discount fees charged to the merchants based on the sales amount of transactions processed. Revenues include a discount fee and membership fees charged to merchants and debit network fees as well as point-of-sale (“POS”) rental fees. Pursuant to the guidance from ASC 605-45-45, Revenue Recognition—Principal Agent Considerations, EVERTEC records Merchant Acquiring revenues net of interchange and assessments charged by the credit and debit card network associations and recognizes such revenues at the time of the sale (when a transaction is processed). | |
Payment processing revenues are comprised of revenues related to providing access to the ATH network and other card networks to financial institutions, and related services. Payment processing revenues also include revenues from card issuer processing services (such as credit and debit card processing, authorization and settlement, and fraud monitoring and control to debit or credit card issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions) and EBT (which principally consists of services to the Puerto Rico government for the delivery of government benefits to participants). Revenues in EVERTEC’s Payment Processing segment are primarily comprised of fees per transaction processed or per account on file, or a combination of both, and are recognized at the time transactions are processed or on a monthly basis for accounts on file. | |
Transaction-based fees within EVERTEC’s Business Solutions segment consist of revenues from business process management solutions including core bank processing, business process outsourcing, item and cash processing, and fulfillment. Transaction-based fee revenues generated by the Company’s core bank processing services are derived from fees based on various factors such as the number of accounts on file (e.g. savings or checking accounts, loans, etc.), and the number of transactions processed or registered users (e.g. for online banking services). For services dependent on the number of transactions processed, revenues are recognized as the underlying transactions are processed. For services dependent on the number of users or accounts on file, revenues are recognized on a monthly basis based on the number of accounts on file each month. Item and cash processing revenues are based upon the number of items (e.g. checks) processed and revenues are recognized when the underlying item is processed. Fulfillment services include technical and operational resources for producing and distributing variable print documents such as statements, bills, checks and benefits summaries. Fulfillment revenues are based upon the number pages for printing services and the number of envelopes processed for mailing services. Revenues are recognized as services are delivered based on a fee per page printed or envelope mailed, as applicable. | |
Fixed fees and time and material | |
The Company also provides services that generate a fixed fee per month or fees based on time and expenses incurred. These services are mostly provided in EVERTEC’s Business Solutions segment. Revenues are generated from EVERTEC’s core bank solutions, network hosting and management and IT consulting services. | |
In core bank solutions, the Company mostly provides access to applications and services such as back-up or recovery, hosting and maintenance that enable a bank to operate the related hosted services accessing the Company’s IT infrastructure. These contracts generally contain multiple elements or deliverables which are evaluated by EVERTEC and revenues are recognized according to the applicable guidance. Revenue is derived from fixed fees charged for the use of hosted services and are recognized on a monthly basis as delivered. Set-up fees are billed to the customer when the service is rendered; however, they are deferred and recognized as revenues over the term of the arrangement or the expected period of the customer relationship, whichever is longer, as set-up services rarely provide value to the customer on a stand-alone basis and are interrelated with the service to be provided under the contract. | |
In network hosting and management, EVERTEC provides hosting services for network infrastructure at EVETEC’s facilities; automated monitoring services; maintenance of call centers; interactive voice response solutions, among other related services. Revenues are primarily derived from monthly fees as services are delivered. Set-up fees are billed up-front to the customer when the set-up service is rendered; however, they are deferred and recognized as revenues over the term of the arrangement or the expected period of the customer relationship, whichever is longer, as set-up services rarely provide value to the customer on a stand-alone basis and are interrelated with the service under the contract. There are some arrangements under this line of service category that may contain undelivered elements. In such cases, the undelivered elements are evaluated and recognized when the services are delivered or at the time that all deliverables under the contract have been delivered. | |
IT consulting services revenue primarily consists of time billings based upon the number of hours dedicated to each client. Revenue from time billings are recognized as services are delivered. | |
EVERTEC also charges members of the ATH network an annual membership fee; however, these fees are deferred and recognized as revenues on a straight-line basis over the year and recorded in the Company’s Payment Processing segment. In addition, occasionally EVERTEC is a reseller of hardware and software products and revenues from these resale transactions are recognized when such product is delivered and accepted by the client. | |
Service level arrangements | |
The Company’s service contracts may include service level arrangements (“SLA”) generally allowing the customer to receive a credit for part of the service fee when the Company has not provided the agreed level of services. The SLA performance obligation is committed on a monthly basis, thus SLA performance is monitored and assessed for compliance with arrangements on a monthly basis, including determination and accounting for its economic impact, if any. | |
Investment in Equity Investee | Investment in Equity Investee |
The Company accounts for investments using the equity method of accounting if the investment provides the Company the ability to exercise significant influence, but not control, over an investee. Significant influence is generally deemed to exist if the Company has an ownership interest in the voting stock of an investor of between 20 percent and 50 percent, although other factors are considered in determining whether the equity method of accounting is appropriate. Under this method, the investment, originally recorded at cost, is adjusted to recognize the Company’s share of net income or losses as they occur. The Company’s share of investee earnings or losses is recorded, net of taxes, within earnings in equity method investment caption in the consolidated statements of income (loss) and comprehensive income (loss). The Company’s consolidated revenues include fees for services provided to an investee accounted under the equity method. Additionally, the Company’s interest in the net asset of its equity method investee is reflected in the consolidated balance sheets. On the acquisition of the investment any difference between the cost of the investment and the amount of the underlying equity in net assets of an investee is required to be accounted as if the investee were a consolidated subsidiary. If the difference is assigned to depreciable or amortizable assets or liabilities, then the difference should be amortized or accreted in connection with the equity earnings based on the Company’s proportionate share of the investee’s net income or loss. If the investor is unable to relate the difference to specific accounts of the investee, the difference should be considered to be goodwill. | |
The Company considers whether the fair values of its equity method investment have declined below their carrying value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If the Company considered any such decline to be other than temporary (based on various factors, including historical financial results, product development activities and the overall health of the investee’s industry), then the Company would record a write-down to estimated fair value. | |
Property and Equipment | Property and Equipment |
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method and expensed over their estimated useful lives. Amortization of leasehold improvements is computed over the terms of the respective leases, including renewal options considered by management to be reasonably assured of being exercised, or the estimated useful lives of the improvements, whichever is shorter. Costs of maintenance and repairs which do not improve or extend the life of the respective assets are expensed as incurred. | |
Impairment on Long-lived Assets | Impairment on Long-lived Assets |
Long-lived assets to be held and used, and long-lived assets to be disposed of, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. | |
Capitalization of Software | Capitalization of Software |
EVERTEC Group develops software that is used in providing processing services to customers. Capitalized software includes purchased software and internally-developed software and is recognized as software packages within the other intangible assets line item in the consolidated balance sheets. Capitalization of internally developed software occurs only after the preliminary project stage is complete and management authorizes and commits to a software project and it is probable that the project will be completed. Tasks that are generally capitalized are as follows: (a) system design of a chosen path including software configuration and software interfaces; (b) employee costs directly associated with the internal-use computer software project; (c) software development (coding) and software and system testing and verification; (d) system installation; and (e) enhancements that add function and are considered permanent. These tasks are capitalized and amortized using the straight line method over its estimated useful life, which range from three to ten years and is included in depreciation and amortization in the consolidated statements of income (loss) and comprehensive income (loss). | |
Software and Maintenance Contracts | Software and Maintenance Contracts |
Software and maintenance contracts are recorded at cost. Amortization of software and maintenance contracts is computed using the straight-line method and expensed over their estimated useful lives which range from one to five years and are recognized in cost of revenues in the consolidated statements of income (loss) and comprehensive income (loss). | |
Software and maintenance contracts are recognized as prepaid expenses and other assets or within other long-term assets depending on their remaining useful lives. | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets |
Goodwill represents the excess of the purchase price and related costs over the value assigned to net assets acquired. Goodwill is not amortized, but is tested for impairment at least annually, or more often if events or circumstances indicate there may be impairment. | |
For 2014, the Company used a “qualitative assessment” option or “step zero” for the goodwill impairment test for all of its reporting units. With this process, the Company first assesses whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount. If the answer is no, then the fair value of the reporting unit does not need to be measured, and step one and step two, as explained below, are bypassed. In assessing the fair value of a reporting unit, which is based on the nature of the business and reporting unit’s current and expected financial performance, the Company uses a combination of factors such as industry and market conditions, overall financial performance and the entity and reporting unit specific events. | |
In the past, the goodwill impairment test used was a two-step process at each reporting unit level. The first step used to identify potential impairment, compared the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeded its carrying amount, goodwill of the reporting unit was not considered impaired and the second step of the impairment test was unnecessary. If needed, the second step consisted of comparing the implied fair value of the reporting unit with the carrying amount of that goodwill. | |
For the years ended December 31, 2014, 2013 and 2012, no impairment losses associated with goodwill were recognized. | |
Other identifiable intangible assets with a definitive useful life are amortized using the straight-line method. These intangibles are evaluated periodically for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. | |
Other identifiable intangible assets with a definitive useful life were acquired during September 2010 when Apollo acquired a 51% indirect ownership interest in EVERTEC as part of a merger (the “Merger”) and include customer relationship, trademark, software packages and non-compete agreement. Customer relationship was valued using the excess earnings method under the income approach. Trademark was valued using the relief-from-royalty method under the income approach. Software packages, which include capitalized software development costs, were recorded at cost. Non-compete agreement was valued based on the estimated impact that theoretical competition would have on revenues and expenses. | |
Indemnification Assets | Indemnification Assets |
Indemnification assets represent the Company’s estimates of payments from Popular related to expected losses on services provided to certain common customers of the Company and Popular, and for certain incremental software and license costs expected to be incurred by the Company (see Note 19) during the five years following the Merger date. Indemnification assets are recorded at the fair value of the expected cash flows. The indemnification asset decreases by the payments received from Popular and is subsequently adjusted to reflect the asset at fair value. The fair value adjustment, if any, is included in current period earnings. As of December 31, 2014 and 2013, the Company’s indemnification related to the software amounted to $1.4 million and $3.6 million, respectively. The current portion of the indemnification assets is included within accounts receivable, net and the other long-term portion is included within other long-term assets in the accompanying consolidated balance sheets. During 2012, the agreement for reimbursement of expected costs with Popular expired. Therefore, no fair value was recorded as of December 31, 2014, 2013 or 2012. For the year ended December 31, 2012, the Company recorded a gain amounting to $1.0 million. The Company recorded a $0.4 million loss in 2014, a $0.4 million loss for 2013, and a gain of $33,000 for 2012, related to the software. | |
Income Tax | Income Tax |
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of income (loss) and comprehensive income (loss) in the period that includes the enactment date. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. A deferred tax valuation allowance is established if it is considered more likely than not that all or a portion of the deferred tax asset will not be realized. | |
All companies within EVERTEC are legal entities which file separate income tax returns. | |
Cash | Cash |
Cash includes cash on hand and in banks. | |
Restricted Cash | Restricted Cash |
Restricted cash represents cash received on deposits from participating institutions of the ATH network that has been segregated for the development of the ATH brand. Also, restricted cash includes certain cash collected from the Ticketpop business and a reserve account for payment and transaction processing services to merchants. The restrictions of these accounts are based on contractual provisions entered into with third parties. This cash is maintained in separate accounts at a financial institution in Puerto Rico. | |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts |
An allowance for doubtful accounts is provided for based on the estimated uncollectible amounts of the related receivables. The estimate is primarily based on a review of the current status of specific accounts receivable. Receivables are considered past due if full payment is not received by the contractual date. Past due accounts are generally written off against the allowance for doubtful accounts only after all collection attempts have been exhausted. | |
Foreign Currency Translation | Foreign Currency Translation |
Assets and liabilities denominated in foreign currencies are translated to U.S. dollars using prevailing rates of exchange at the end of the period. Revenues, expenses, gains and losses are translated using weighted average rates for the period. The resulting foreign currency translation adjustment from operations for which the functional currency is other than the U.S. dollar is reported in accumulated other comprehensive income (loss). Gains and losses on transactions denominated in currencies other than the functional currencies are included in determining net income for the period in which exchange rates change. | |
Share-based Compensation | Share-based Compensation |
The Company estimates the fair value of stock-based awards, on a contemporaneous basis, at the date they are granted using the Black-Scholes-Merton option pricing model for Tranche A options and the Monte Carlo simulation analysis for Tranche B and Tranche C options using the following assumptions: (1) stock price; (2) risk-free rate; (3) expected volatility; (4) expected annual dividend yield and (5) expected term. The risk-free rate is based on the U.S. Constant Maturities Treasury Interest Rate as of the grant date. The expected volatility is based on a combination of historical volatility and implied volatility from publicly traded companies in the Company’s industry. The expected annual dividend yield is based on management’s expectations of future dividends as of the grant date. The expected term for stock options granted under the 2010 Plan was based on the vesting time of the options. For the stock options granted under the 2013 Plan, the simplified method was used to estimate the expected term, given that the Company does not have appropriate exercise data on which to base the estimate nor is exercise data relating to employees of comparable companies easily obtainable. | |
Upon option exercise, participants may elect to “net share settle”. Rather than requiring the participant to deliver cash to satisfy the exercise price and statutory minimum tax withholdings, the Company withholds a sufficient number of shares to cover these amounts and delivers the net shares to the participant. The Company recognizes the associated tax withholding obligation as a reduction of additional paid-in capital. | |
As compensation expense is recognized, a deferred tax asset is established. At the time stock options are exercised, a current tax deduction arises based on the value at the time of exercise. This deduction may exceed the associated deferred tax asset, resulting in a “windfall tax benefit”. The windfall is recognized in the consolidated balance sheet as an increase to additional paid-in capital, and is included in the consolidated statement of cash flows as a financing inflow. | |
In determining the amount of cash tax savings realized from the excess share-based compensation deductions, the Company follows the tax law ordering approach. Under this approach, the utilization of excess tax deductions associated with share-based awards is dictated by provision in the tax law that identify the sequence in which such benefits are utilized for tax purposes. | |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share |
Basic net income (loss) per common share is determined by dividing net income (loss) by the weighted-average number of common shares outstanding during the period. | |
Diluted net income (loss) per common share assumes the issuance of all potentially dilutive share equivalents using the treasury stock method. For stock options it is assumed that the proceeds will be used to buy back shares. Such proceeds equal the average unrecognized compensation plus exercise price and windfall tax benefits. For unvested restricted shares, the proceeds equal the average unrecognized compensation plus windfall tax benefits. |
Accounts_Receivable_Net_Tables
Accounts Receivable, Net (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Receivables [Abstract] | |||||||||
Accounts Receivable, Net | |||||||||
Accounts receivable, net consisted of the following: | |||||||||
December 31, | |||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||
Trade | $ | 53,503 | $ | 46,200 | |||||
Due from affiliates, net | 13,140 | 12,030 | |||||||
Settlement assets | 9,868 | 11,157 | |||||||
Other | 306 | 69 | |||||||
Less: allowance for doubtful accounts | (1,007 | ) | (1,022 | ) | |||||
Accounts receivable, net | $ | 75,810 | $ | 68,434 | |||||
Prepaid_Expenses_and_Other_Ass1
Prepaid Expenses and Other Assets (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||
Prepaid Expenses and Other Assets | Prepaid expenses and other assets consisted of the following: | ||||||||
December 31, | |||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||
Taxes other than income | $ | 1,102 | $ | 859 | |||||
Software licenses and maintenance contracts | 7,028 | 6,570 | |||||||
Prepaid income taxes | 3,726 | 5,278 | |||||||
Postage | 709 | 1,675 | |||||||
Insurance | 1,321 | 1,120 | |||||||
Deferred project costs | 3,040 | 1,958 | |||||||
Other | 3,639 | 2,022 | |||||||
Prepaid expenses and other assets | $ | 20,565 | $ | 19,482 | |||||
Property_and_Equipment_Net_Tab
Property and Equipment, Net (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||
Property and Equipment, Net | |||||||||||
Property and equipment, net consisted of the following: | |||||||||||
Useful life | December 31, | ||||||||||
(Dollar amounts in thousands) | in years | 2014 | 2013 | ||||||||
Buildings | 30 | $ | 1,602 | $ | 1,726 | ||||||
Data processing equipment | 3 - 5 | 77,588 | 68,273 | ||||||||
Furniture and equipment | 3 - 20 | 7,540 | 6,385 | ||||||||
Leasehold improvements | 5 - 10 | 2,964 | 2,880 | ||||||||
89,694 | 79,264 | ||||||||||
Less—accumulated depreciation and amortization | (61,580 | ) | (47,555 | ) | |||||||
Depreciable assets, net | 28,114 | 31,709 | |||||||||
Land | 1,421 | 1,531 | |||||||||
Property and equipment, net | $ | 29,535 | $ | 33,240 | |||||||
Goodwill_Tables
Goodwill (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||
Changes in Carrying Amount of Goodwill Allocated by Reportable Segments | The changes in the carrying amount of goodwill, allocated by reportable segments, were as follows (See Note 21): | ||||||||||||||||
(Dollar amounts in thousands) | Merchant | Payment | Business | Total | |||||||||||||
acquiring, net | processing | solutions | |||||||||||||||
Balance at December 31, 2011 | $ | 138,121 | $ | 186,470 | $ | 47,121 | $ | 371,712 | |||||||||
Foreign currency translation adjustments | — | 558 | 37 | 595 | |||||||||||||
Balance at December 31, 2012 | 138,121 | 187,028 | 47,158 | 372,307 | |||||||||||||
Foreign currency translation adjustments | — | 594 | 218 | 812 | |||||||||||||
Balance at December 31, 2013 | 138,121 | 187,622 | 47,376 | 373,119 | |||||||||||||
Foreign currency translation adjustments | — | (3,394 | ) | (888 | ) | (4,282 | ) | ||||||||||
Balance at December 31, 2014 | $ | 138,121 | $ | 184,228 | $ | 46,488 | $ | 368,837 | |||||||||
Other_Intangible_Assets_Tables
Other Intangible Assets (Tables) | 12 Months Ended | ||||||||||||||
Dec. 31, 2014 | |||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||
Carrying Amount of Other Intangible Assets | The carrying amount of other intangible assets consisted of the following: | ||||||||||||||
December 31, 2014 | |||||||||||||||
(Dollar amounts in thousands) | Useful life in years | Gross | Accumulated | Net carrying | |||||||||||
amount | amortization | amount | |||||||||||||
Customer relationships | 14 | $ | 312,735 | $ | (95,482 | ) | $ | 217,253 | |||||||
Trademark | 10 - 15 | 39,950 | (14,722 | ) | 25,228 | ||||||||||
Software packages | 3 - 10 | 138,188 | (86,605 | ) | 51,583 | ||||||||||
Non-compete agreement | 15 | 56,539 | (16,019 | ) | 40,520 | ||||||||||
Other intangible assets, net | $ | 547,412 | $ | (212,828 | ) | $ | 334,584 | ||||||||
31-Dec-13 | |||||||||||||||
(Dollar amounts in thousands) | Useful life in years | Gross | Accumulated | Net carrying | |||||||||||
amount | amortization | amount | |||||||||||||
Customer relationships | 14 | $ | 314,036 | $ | (73,180 | ) | $ | 240,856 | |||||||
Trademark | 10 - 15 | 39,950 | (11,258 | ) | 28,692 | ||||||||||
Software packages | 3 - 10 | 119,598 | (65,655 | ) | 53,943 | ||||||||||
Non-compete agreement | 15 | 56,539 | (12,250 | ) | 44,289 | ||||||||||
Other intangible assets, net | $ | 530,123 | $ | (162,343 | ) | $ | 367,780 | ||||||||
Estimated Amortization Expenses | The estimated amortization expenses of balances outstanding at December 31, 2014 for the next five years are as follows: | ||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||
2015 | $ | 48,083 | |||||||||||||
2016 | 38,025 | ||||||||||||||
2017 | 34,879 | ||||||||||||||
2018 | 32,392 | ||||||||||||||
2019 | 31,593 | ||||||||||||||
Debt_and_ShortTerm_Borrowings_
Debt and Short-Term Borrowings (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | |||||||||
Total Debt | Total debt was as follows: | ||||||||
December 31, | |||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||
Senior Secured Credit Facility (Term A) due on April 17, 2018 paying interest at a variable interest rate (London InterBank Offered Rate (“LIBOR”) plus applicable margin (1)(3)) | $ | 277,239 | $ | 292,153 | |||||
Senior Secured Credit Facility (Term B) due on April 17, 2020 paying interest at a variable interest rate (LIBOR plus applicable margin (2)(3)) | 389,340 | 392,527 | |||||||
Senior Secured Revolving Credit Facility expiring on April 17, 2018 paying interest at a variable interest rate | 23,000 | 50,000 | |||||||
Other short-term borrowing | — | 1,200 | |||||||
Note Payable due on October 1, 2017 (3) | 4,333 | — | |||||||
Total debt | $ | 693,912 | $ | 735,880 | |||||
-1 | Applicable margin of 2.50% at December 31, 2014 and 2013. | ||||||||
(2) | Subject to a minimum rate (“LIBOR floor”) of 0.75% plus applicable margin of 2.75% at December 31, 2014 and 2013. | ||||||||
(3) | Includes unamortized discount. |
Financial_Instruments_and_Fair1
Financial Instruments and Fair Value Measurements (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Fair Value Measurements for Assets at Fair Value on Recurring Basis | The following table summarizes fair value measurements by level at December 31, 2014 and 2013, for assets measured at fair value on a recurring basis: | ||||||||||||||||
(Dollar amounts in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
December 31, 2014 | |||||||||||||||||
Financial assets: | |||||||||||||||||
Indemnification assets: | |||||||||||||||||
Software cost reimbursement | $ | — | $ | — | $ | 1,428 | $ | 1,428 | |||||||||
December 31, 2013 | |||||||||||||||||
Financial assets: | |||||||||||||||||
Indemnification assets: | |||||||||||||||||
Software cost reimbursement | $ | — | $ | — | $ | 3,586 | $ | 3,586 | |||||||||
Carrying Value and Estimated Fair Values for Financial Instruments | The following table presents the carrying value, as applicable, and estimated fair values for financial instruments at December 31, 2014 and 2013: | ||||||||||||||||
December 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
(Dollar amounts in thousands) | Carrying | Fair Value | Carrying | Fair Value | |||||||||||||
Amount | Amount | ||||||||||||||||
Financial assets: | |||||||||||||||||
Indemnification assets: | |||||||||||||||||
Software cost reimbursement | $ | 1,428 | $ | 1,428 | $ | 3,586 | $ | 3,586 | |||||||||
Financial liabilities: | |||||||||||||||||
Senior secured term loan A | $ | 277,240 | $ | 266,400 | $ | 292,153 | $ | 284,091 | |||||||||
Senior secured term loan B | 389,340 | 385,462 | 392,527 | 387,055 | |||||||||||||
Summary of Change in Fair Value of Level Three Assets | The following table provides a summary of the change in fair value of the Company’s Level 3 assets: | ||||||||||||||||
(Dollar amounts in thousands) | Indemnification | ||||||||||||||||
Assets | |||||||||||||||||
Balance - December 31, 2011 | $ | 7,464 | |||||||||||||||
Payments received | (2,331 | ) | |||||||||||||||
Unrealized loss recognized in other expenses | 966 | ||||||||||||||||
Balance - December 31, 2012 | $ | 6,099 | |||||||||||||||
Payments received | (2,130 | ) | |||||||||||||||
Unrealized gain recognized in other expenses | (383 | ) | |||||||||||||||
Balance - December 31, 2013 | $ | 3,586 | |||||||||||||||
Payments received | (1,712 | ) | |||||||||||||||
Unrealized loss recognized in other expenses | (446 | ) | |||||||||||||||
Balance - December 31, 2014 | $ | 1,428 | |||||||||||||||
Equity_Tables
Equity (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Equity [Abstract] | |||||||||
Summary of Dividend Activity | The Company’s dividend activity in 2014 and 2013 was as follows: | ||||||||
Declaration Date | Record Date | Payment Date | Dividend per share | ||||||
August 7, 2013 | August 19, 2013 | September 6, 2013 | $ | 0.1 | |||||
November 6, 2013 | November 18, 2013 | 6-Dec-13 | 0.1 | ||||||
February 12, 2014 | 25-Feb-14 | 14-Mar-14 | 0.1 | ||||||
May 7, 2014 | 19-May-14 | 6-Jun-14 | 0.1 | ||||||
August 6, 2014 | 18-Aug-14 | 5-Sep-14 | 0.1 | ||||||
November 5, 2014 | 17-Nov-14 | 5-Dec-14 | 0.1 | ||||||
Sharebased_Compensation_Tables
Share-based Compensation (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||
Summary of Stock Option Activity | The following table summarizes the stock options activity for the years ended December 31, 2014, 2013 and 2012: | ||||||||||||||||||||||||
Shares | Weighted-average | ||||||||||||||||||||||||
exercise prices(1) | |||||||||||||||||||||||||
Outstanding at December 31, 2011 | 5,388,548 | $ | 1.3 | ||||||||||||||||||||||
Granted(2) | 1,020,000 | 4.95 | |||||||||||||||||||||||
Forfeitures | (1,230,966 | ) | 1.3 | ||||||||||||||||||||||
Outstanding at December 31, 2012 | 5,177,582 | $ | 2.06 | ||||||||||||||||||||||
Granted | 150,000 | 23.36 | |||||||||||||||||||||||
Exercised(3) | (4,042,046 | ) | 1.99 | ||||||||||||||||||||||
Outstanding at December 31, 2013 | 1,285,536 | $ | 4.77 | ||||||||||||||||||||||
Granted | 100,000 | 24.01 | |||||||||||||||||||||||
Forfeitures | (31,164 | ) | 1.3 | ||||||||||||||||||||||
Exercised(3) | (945,040 | ) | 1.96 | ||||||||||||||||||||||
Repurchased | (93,332 | ) | 4.83 | ||||||||||||||||||||||
Outstanding at December 31, 2014 | 316,000 | $ | 19.56 | ||||||||||||||||||||||
Exercisable at December 31, 2014 | 50,000 | $ | 23.36 | ||||||||||||||||||||||
(1) | Exercise price was retroactively adjusted to reflect the equitable adjustment of $3.71 per share as discussed below. | ||||||||||||||||||||||||
(2) | Includes 100,000 of stock options that were not granted under the Equity Incentive Plans, but are subject to certain terms of the 2010 Plan. | ||||||||||||||||||||||||
(3) | At December 31, 2014, the total intrinsic value of options exercised during the year amounted to $19.3 million. | ||||||||||||||||||||||||
Fully Vested Stock Options | The following table presents information about fully vested stock options for the years ended December 31, 2014, 2013 and 2012: | ||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Shares | Weighted | Shares | Weighted | Shares | Weighted | ||||||||||||||||||||
average | average | average | |||||||||||||||||||||||
exercise price | exercise price | exercise price | |||||||||||||||||||||||
Vested stock options(1)(2)(3) | 766,995 | $ | 3.75 | 3,757,099 | $ | 2.07 | 279,750 | $ | 1.3 | ||||||||||||||||
(1) | At December 31, 2014, 2013 and 2012, the aggregate intrinsic value amounted to $14.0 million, $84.9 million and $1.6 million, respectively. | ||||||||||||||||||||||||
(2) | The weighted average contractual term of fully vested options is 6.06 years, 7.04 years and 7.85 years as of December 31, 2014, 2013 and 2012, respectively. | ||||||||||||||||||||||||
(3) | The fair value of vested stock options at December 31, 2014, 2013 and 2012 amounted to $17.0 million, $92.7 million and $2.0 million, respectively. | ||||||||||||||||||||||||
Assumptions used to Estimate Fair Value of Stock Option Granted | The fair value of stock options granted during 2014, 2013 and 2012 was estimated using the Black-Scholes-Merton (“BSM”) option pricing model, with the following assumptions: | ||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Stock options granted | Stock options granted | Stock options granted | |||||||||||||||||||||||
under the 2013 Plan | under the 2013 Plan | under the 2010 Plan | |||||||||||||||||||||||
Stock Price (1) | $ | 24.01 per share | $ | 23.36 per share | $ | 5.19 per share | |||||||||||||||||||
Risk-free rate | 1.8 | % | 1.68 | % | 0.59 | % | |||||||||||||||||||
Expected volatility | 36.98 | % | 36.56 | % | 31.12 | % | |||||||||||||||||||
Expected annual dividend yield | 1.63 | % | 1.71 | % | 0 | % | |||||||||||||||||||
Expected term | 6 years | 6 years | 3.87 years | ||||||||||||||||||||||
(1) | As discussed above, on May 9, 2012 an equitable adjustment to stock options was approved which caused a reduction of $3.71 per share of the exercise price of the outstanding options. Accordingly, the stock price presented above reflects this equitable adjustment for 2012. | ||||||||||||||||||||||||
Nonvested Restricted Shares Activity | The following table summarizes the nonvested restricted shares activity for the years ended December 31, 2014, 2013 and 2012: | ||||||||||||||||||||||||
Nonvested restricted shares | Shares | Weighted-average | |||||||||||||||||||||||
grant date fair value | |||||||||||||||||||||||||
Nonvested at December 31, 2011 | 126,116 | $ | 5 | ||||||||||||||||||||||
Granted | 29,292 | 8.54 | |||||||||||||||||||||||
Vested | (39,988 | ) | 5 | ||||||||||||||||||||||
Nonvested at December 31, 2012 | 115,420 | $ | 5.9 | ||||||||||||||||||||||
Granted | 9,133 | 24.64 | |||||||||||||||||||||||
Vested | (115,420 | ) | 5.9 | ||||||||||||||||||||||
Nonvested at December 31, 2013 | 9,133 | $ | 24.64 | ||||||||||||||||||||||
Granted | 23,252 | 22.04 | |||||||||||||||||||||||
Vested | (9,133 | ) | 24.64 | ||||||||||||||||||||||
Nonvested at December 31, 2014 | 23,252 | $ | 22.04 | ||||||||||||||||||||||
Share-Based Compensation Recognized | Share-based compensation recognized was as follows: | ||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||||||||||||||
Share-based compensation recognized, net | |||||||||||||||||||||||||
Stock options | $ | 4,305 | $ | 5,820 | $ | 595 | |||||||||||||||||||
Restricted shares | 282 | 359 | 609 | ||||||||||||||||||||||
Income_Tax_Tables
Income Tax (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Components of Income Tax Expense (Benefit) | The components of income tax benefit consisted of the following: | ||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Current tax provision | $ | 9,291 | $ | 3,712 | $ | 6,910 | |||||||
Deferred tax benefit | (1,713 | ) | (5,702 | ) | (66,568 | ) | |||||||
Income tax expense (benefit) | $ | 7,578 | $ | (1,990 | ) | $ | (59,658 | ) | |||||
Segregation of Income Tax Expense (Benefit) Based on Location of Operations | The following table presents the segregation of income tax benefit based on location of operations: | ||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Income (loss) before income tax provision (benefit) | |||||||||||||
Puerto Rico | 61,395 | (35,255 | ) | 9,941 | |||||||||
United States | 2,131 | 2,031 | 1,534 | ||||||||||
Foreign countries | 11,584 | 6,613 | 6,233 | ||||||||||
Total income (loss) before income tax provision (benefit) | $ | 75,110 | $ | (26,611 | ) | $ | 17,708 | ||||||
Current tax provision (benefit) | |||||||||||||
Puerto Rico | $ | 4,779 | $ | 913 | $ | 4,661 | |||||||
United States | (517 | ) | 753 | 622 | |||||||||
Foreign countries | 5,029 | 2,046 | 1,627 | ||||||||||
Total current tax provision | $ | 9,291 | $ | 3,712 | $ | 6,910 | |||||||
Deferred tax benefit | |||||||||||||
Puerto Rico | $ | 56 | $ | (5,094 | ) | $ | (65,822 | ) | |||||
United States | (124 | ) | (5 | ) | (38 | ) | |||||||
Foreign countries | (1,645 | ) | (603 | ) | (708 | ) | |||||||
Total deferred tax benefit | $ | (1,713 | ) | $ | (5,702 | ) | $ | (66,568 | ) | ||||
Components of Deferred Tax Assets and Liabilities | The following table presents the components of the Company’s deferred tax assets and liabilities: | ||||||||||||
December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||||||
Deferred tax assets (“DTA”) | |||||||||||||
Allowance for doubtful accounts | $ | 346 | $ | 330 | |||||||||
Net operating loss | 7,076 | 11,306 | |||||||||||
Other temporary assets | 2,302 | 1,845 | |||||||||||
Total gross deferred tax assets | 9,724 | 13,481 | |||||||||||
Deferred tax liabilities (“DTL”) | |||||||||||||
Deferred compensation | $ | 1,145 | $ | 993 | |||||||||
Difference between the assigned values and the tax basis of assets and liabilities recognized in purchase | 24,735 | 28,849 | |||||||||||
Debt issue cost | 1,232 | 1,680 | |||||||||||
Other temporary liabilities | (314 | ) | 177 | ||||||||||
Total gross deferred tax liabilities | 26,798 | 31,699 | |||||||||||
Deferred tax liability, net | $ | (17,074 | ) | $ | (18,218 | ) | |||||||
Income Tax Expense (benefit) Differs from Computed Income Tax at Statutory Rates | The income tax expense (benefit) differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income (loss) before income taxes as a result of the following: | ||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Computed income tax at statutory rates | $ | 29,293 | $ | (10,378 | ) | $ | 5,313 | ||||||
Benefit of net tax-exempt interest income | — | (180 | ) | (13 | ) | ||||||||
Tax expense (benefit) due to a change in estimate | (916 | ) | 83 | 320 | |||||||||
Adjustment to deferred taxes due to changes in enacted tax rate and tax grant | 485 | 1,441 | (66,423 | ) | |||||||||
Effect of net disallowed operating losses in foreign entities | 83 | 93 | 1,012 | ||||||||||
Differences in tax rates due to multiple jurisdictions | (942 | ) | 577 | 720 | |||||||||
Effect of income subject to tax-exemption grant | (20,425 | ) | 7,164 | (58 | ) | ||||||||
Reversal of tax uncertainties reserve | — | (846 | ) | (707 | ) | ||||||||
Fair value adjustment of indemnification assets | — | — | 340 | ||||||||||
Other | — | 56 | (162 | ) | |||||||||
Income tax expense (benefit) | $ | 7,578 | $ | (1,990 | ) | $ | (59,658 | ) | |||||
Net_Income_Loss_Per_Common_Sha1
Net Income (Loss) Per Common Share (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Earnings Per Share [Abstract] | |||||||||||||
Schedule of Reconciliation of Numerator and Denominator of Earning Per Common Share | The reconciliation of the numerator and the denominator of the earnings per common share is as follows: | ||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands, except per share data) | 2014 | 2013 | 2012 | ||||||||||
Net income (loss) | $ | 67,532 | $ | (24,621 | ) | $ | 77,366 | ||||||
Weighted average common shares outstanding | 78,337,152 | 78,914,310 | 72,687,622 | ||||||||||
Weighted average potential dilutive common shares (1)(2) | 553,987 | — | 3,948,795 | ||||||||||
Weighted average common shares outstanding—assuming dilution | 78,891,139 | 78,914,310 | 76,636,417 | ||||||||||
Net income (loss) per common share—basic | $ | 0.86 | $ | (0.31 | ) | $ | 1.06 | ||||||
Net income (loss) per common share—diluted | $ | 0.86 | $ | (0.31 | ) | $ | 1.01 | ||||||
(1) | Potential common shares consist of common stock issuable under the assumed exercise of stock options and restricted stock awards using the treasury stock method. | ||||||||||||
(2) | For the year ended December 31, 2013, 2,325,209 potential common shares consisting of common stock under the assumed exercise of stock options and restricted stock awards using the treasury stock method were not included in the computation of the diluted net income (loss) per share since their inclusion would have an antidilutive effect. |
Related_Party_Transactions_Tab
Related Party Transactions (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Related Party Transactions [Abstract] | |||||||||||||
Transactions with Related Parties | The following table presents the Company’s transactions with related parties for each of the periods presented below: | ||||||||||||
Years ended December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||
Total revenues (1)(2) | $ | 164,142 | $ | 167,325 | $ | 155,112 | |||||||
Cost of revenues | $ | 1,342 | $ | 8,290 | $ | 426 | |||||||
Rent and other fees (3)(4) | $ | 7,928 | $ | 27,762 | $ | 11,319 | |||||||
Interest earned from and charged by affiliate | |||||||||||||
Interest income | $ | 197 | $ | 130 | $ | 222 | |||||||
Interest expense(5) | $ | — | $ | 2,471 | $ | 7,476 | |||||||
(1) | Total revenues from Popular as a percentage of revenues were 45%, 46% and 44% for each of the periods presented above. | ||||||||||||
(2) | Includes revenues generated from investee accounted for under the equity method of $2.5 million, $3.0 million and $3.7 million for the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||||||
(3) | Includes management fees to equity sponsors amounting to $3.5 million and $3.7 million for the years ended December 31, 2013 and 2012, respectively. Management fees paid during 2013 also includes $16.7 million resulting from the termination of the consulting agreements as explained below. Rent and other fees also include $5.9 million paid in connection with the redemption premium on the senior notes during the first half of 2013. | ||||||||||||
(4) | Includes $7.9 million, $11.1 million and $11.3 million recorded as selling, general and administrative expenses for each of the periods presented above, and $16.7 million recorded as non-operating expenses for the year ended December 31, 2013 in the audited consolidated statement of income (loss) and comprehensive income (loss). | ||||||||||||
(5) | Interest expense relates to interest accrued on the senior secured term loan and senior notes held by Popular. As a result of the debt refinancing and the redemption of the senior notes in April 2013, Popular’s participation in such debt was extinguished. See Note 11 for additional information related to the extinguishment of this debt. | ||||||||||||
Summary of Balances of Transactions with Related Parties | At December 31, 2014 and 2013, the Company had the following balances arising from transactions with related parties: | ||||||||||||
December 31, | |||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | |||||||||||
Cash and restricted cash deposits in affiliated bank | $ | 13,566 | $ | 13,933 | |||||||||
Indemnification assets from Popular reimbursement (1) | |||||||||||||
Accounts receivable | $ | 1,428 | $ | 1,900 | |||||||||
Other long-term assets | $ | — | $ | 1,686 | |||||||||
Other due/to from affiliate | |||||||||||||
Accounts receivable | $ | 17,006 | $ | 18,799 | |||||||||
Prepaid expenses and other assets | $ | 1,141 | $ | 216 | |||||||||
Accounts payable (2) | $ | 5,260 | $ | 8,886 | |||||||||
Unearned income | $ | 8,154 | $ | 4,100 | |||||||||
Other long-term liabilities (2) | $ | 45 | $ | 333 | |||||||||
-1 | Recorded in connection with reimbursement from Popular regarding certain software license fees. | ||||||||||||
(2) | Includes an account payable of $0.2 million for both December 31, 2014 and 2013 and a long-term liability of $45,000 and $0.3 million for December 31, 2014 and 2013, respectively, related to the unvested portion of stock options as a result of the equitable adjustment approved by the Company’s Board of Directors on December 18, 2012 that will be payable to executive officers and employees upon vesting of stock options. |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||
Future Minimum Rental Payments on Operating Leases | The Company leases certain facilities and equipment under operating leases. Most leases contain renewal options for varying periods. Future minimum rental payments on such operating leases at December 31, 2014 are as follows: | ||||||||||||
(Dollar amounts in thousands) | Unrelated | Related | Minimum | ||||||||||
parties | party | future rentals | |||||||||||
2015 | $ | 625 | $ | 4,100 | $ | 4,725 | |||||||
2016 | 356 | 4,226 | 4,582 | ||||||||||
2017 | 118 | 4,352 | 4,470 | ||||||||||
2018 | — | 4,483 | 4,483 | ||||||||||
2019 and thereafter | — | 5,780 | 5,780 | ||||||||||
$ | 1,099 | $ | 22,941 | $ | 24,040 | ||||||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||
Information about Operations by Business Segments | The following tables set forth information about the Company’s operations by its three business segments for the periods indicated: | ||||||||||||||||||||
(Dollar amounts in thousands) | Merchant | Payment | Business | Other | Total | ||||||||||||||||
Acquiring, net | Processing | Solutions | |||||||||||||||||||
Year ended December 31, 2014 | |||||||||||||||||||||
Revenues | $ | 79,136 | $ | 132,091 | $ | 176,570 | $ | (26,668 | )(1) | $ | 361,129 | ||||||||||
Income from operations | 34,348 | 59,882 | 47,587 | (44,469 | )(2) | 97,348 | |||||||||||||||
Year ended December 31, 2013 | |||||||||||||||||||||
Revenues | 73,616 | 125,610 | 184,297 | (25,506 | )(1) | 358,017 | |||||||||||||||
Income from operations | 35,376 | 54,429 | 42,430 | (46,474 | )(2) | 85,761 | |||||||||||||||
Year ended December 31, 2012 | |||||||||||||||||||||
Revenues | 69,591 | 116,825 | 177,292 | (21,218 | )(1) | 342,490 | |||||||||||||||
Income from operations | 33,836 | 53,682 | 39,845 | (47,717 | )(2) | 79,646 | |||||||||||||||
(1) | Represents the elimination of intersegment revenues for services provided by the Payment Processing segment to the Merchant Acquiring segment, and other miscellaneous intersegment revenues. | ||||||||||||||||||||
(2) | Primarily represents non-operating depreciation and amortization expenses generated as a result of the Merger and certain non-recurring fees and expenses. | ||||||||||||||||||||
Reconciliation of Income from Operations to Consolidated Net Income (Loss) | The reconciliation of income from operations to consolidated net income (loss) is as follows: | ||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||||||||||
Segment income from operations | |||||||||||||||||||||
Merchant Acquiring | $ | 34,348 | $ | 35,376 | $ | 33,836 | |||||||||||||||
Payment Processing | 59,882 | 54,429 | 53,682 | ||||||||||||||||||
Business Solutions | 47,587 | 42,430 | 39,845 | ||||||||||||||||||
Total segment income from operations | 141,817 | 132,235 | 127,363 | ||||||||||||||||||
Merger related depreciation and amortization and other unallocated expenses (1) | (44,469 | ) | (46,474 | ) | (47,717 | ) | |||||||||||||||
Income from operations | $ | 97,348 | $ | 85,761 | $ | 79,646 | |||||||||||||||
Interest expense, net | (25,753 | ) | (37,625 | ) | (54,011 | ) | |||||||||||||||
Earnings of equity method investment | 1,140 | 935 | 564 | ||||||||||||||||||
Other expenses | 2,375 | (75,682 | ) | (8,491 | ) | ||||||||||||||||
Income tax (expense) benefit | (7,578 | ) | 1,990 | 59,658 | |||||||||||||||||
Net income (loss) | $ | 67,532 | $ | (24,621 | ) | $ | 77,366 | ||||||||||||||
(1) | Primarily represents non-operating depreciation and amortization expenses generated as a result of the Merger and certain non-recurring fees and expenses. | ||||||||||||||||||||
Geographic Segment Information Based on Geographic Location of Subsidiaries | The geographic segment information below is classified based on the geographic location of the Company’s subsidiaries: | ||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||
(Dollar amounts in thousands) | 2014 | 2013 | 2012 | ||||||||||||||||||
Revenues (1) | |||||||||||||||||||||
Puerto Rico | $ | 312,569 | $ | 309,350 | $ | 295,285 | |||||||||||||||
Caribbean | 13,752 | 16,225 | 16,280 | ||||||||||||||||||
Latin America | 34,808 | 32,442 | 30,925 | ||||||||||||||||||
Total revenues | $ | 361,129 | $ | 358,017 | $ | 342,490 | |||||||||||||||
(1) | Revenues are based on subsidiaries’ country of domicile. |
The_Company_and_Summary_of_Sig2
The Company and Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 9 Months Ended | 12 Months Ended | 0 Months Ended | |||||
Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Apr. 17, 2013 | Dec. 13, 2013 | Sep. 18, 2013 | Sep. 30, 2010 | |
Country | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Number of countries where the Company provides a broad range of merchant acquiring, payment processing and business process management services | 19 | |||||||
Offering price per share | $0.01 | |||||||
Net proceeds from Initial Public Offering | $543,000 | $29,000 | $450,000 | |||||
Impairment losses | 0 | 0 | 0 | 0 | ||||
Merger, percentage of interests acquired | 51.00% | |||||||
Software cost reimbursement | 1,428,000 | 3,586,000 | ||||||
Fair value recorded | 0 | 0 | 0 | |||||
Software packages [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Gain (Loss) realized on fair value adjustment | 400,000 | 400,000 | 33,000 | |||||
Expense Reimbursements [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Gain (Loss) realized on fair value adjustment | 1,000,000 | |||||||
Senior Notes [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Senior notes, interest rate | 11.00% | |||||||
Senior notes, maturity date | 2018 | |||||||
Common Stock [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 91,696 | |||||||
Evertec Inc | Common Stock [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 6,250,000 | |||||||
Selling Stockholders [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 15,233,273 | 23,000,000 | ||||||
Offering price per share | $20.60 | $22.50 | ||||||
Selling Stockholders [Member] | Common Stock [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 22,539,943 | |||||||
Apollo Global Management Llc [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 0 | 9,200,000 | ||||||
Percentage of equity interest owned | 11.20% | |||||||
Apollo Global Management Llc [Member] | Common Stock [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 13,739,284 | |||||||
Popular [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 11,700,000 | 17,500,000 | ||||||
Percentage of equity interest owned | 14.90% | 21.30% | ||||||
Popular [Member] | Common Stock [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 8,800,659 | |||||||
Minimum [Member] | Software packages [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Intangible asset useful life | 3 years | 3 years | ||||||
Maximum [Member] | Software packages [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Intangible asset useful life | 10 years | 10 years | ||||||
IPO [Member] | Common Stock [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Shares issued under Initial and Other Public Offerings | 28,789,943 | |||||||
Offering price per share | 20 | |||||||
Software Development | Minimum [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Intangible asset useful life | 3 years | |||||||
Software Development | Maximum [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Intangible asset useful life | 10 years | |||||||
2013 Credit Agreement [Member] | IPO [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Net proceeds from Initial Public Offering | $117,400,000 | 117,400,000 | ||||||
Software and maintenance contracts | Minimum [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Intangible asset useful life | 1 year | |||||||
Software and maintenance contracts | Maximum [Member] | ||||||||
Company And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Intangible asset useful life | 5 years |
Cash_Additional_Information_De
Cash - Additional Information (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash | $32,114 | $22,485 | $25,634 | $56,200 |
Cash Deposited In an Affiliate Financial Institution [Member] | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash | $7,800 | $8,500 |
Accounts_Receivable_Net_Detail
Accounts Receivable, Net (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Receivables [Abstract] | ||
Trade | $53,503 | $46,200 |
Due from affiliates, net | 13,140 | 12,030 |
Settlement assets | 9,868 | 11,157 |
Other | 306 | 69 |
Less: allowance for doubtful accounts | -1,007 | -1,022 |
Accounts receivable, net | $75,810 | $68,434 |
Prepaid_Expenses_and_Other_Ass2
Prepaid Expenses and Other Assets (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Prepaid Expenses And Other Current Assets [Line Items] | ||
Software licenses and maintenance contracts | $7,028 | $6,570 |
Postage | 709 | 1,675 |
Insurance | 1,321 | 1,120 |
Deferred project costs | 3,040 | 1,958 |
Other | 3,639 | 2,022 |
Prepaid expenses and other assets | 20,565 | 19,482 |
Taxes other than Income [Member] | ||
Prepaid Expenses And Other Current Assets [Line Items] | ||
Prepaid taxes | 1,102 | 859 |
Income Taxes [Member] | ||
Prepaid Expenses And Other Current Assets [Line Items] | ||
Prepaid taxes | $3,726 | $5,278 |
Investment_in_Equity_Investee_
Investment in Equity Investee - Additional Information (Detail) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Schedule of Equity Method Investments [Line Items] | ||||
Equity interest in CONTADO acquisition | 19.99% | |||
Equity interest in CONTADO, excess cost of investment over underlying equity in net assets | $9,000,000 | |||
Earnings of equity method investment | 1,140,000 | 935,000 | 564,000 | |
Dividends Received from CONTADO | 300,000 | 1,000,000 | 1,600,000 | |
Equity Method Investments [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity interest in CONTADO, amortization expense | $300,000 | $300,000 | $400,000 |
Property_and_Equipment_Net_Det
Property and Equipment, Net (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Line Items] | ||
Buildings | 1,602 | $1,726 |
Data processing equipment | 77,588 | 68,273 |
Furniture and equipment | 7,540 | 6,385 |
Leasehold improvements | 2,964 | 2,880 |
Property and equipment | 89,694 | 79,264 |
Less-accumulated depreciation and amortization | -61,580 | -47,555 |
Depreciable assets, net | 28,114 | 31,709 |
Land | 1,421 | 1,531 |
Property and equipment, net | 29,535 | $33,240 |
Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 30 years | |
Data Processing Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 3 years | |
Data Processing Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 5 years | |
Furniture and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 3 years | |
Furniture and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 20 years | |
Leasehold Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 5 years | |
Leasehold Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful life | 10 years |
Property_and_Equipment_Net_Add
Property and Equipment, Net - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense related to property and equipment | $15.50 | $16.20 | $16.40 |
Changes_in_Carrying_Amount_of_
Changes in Carrying Amount of Goodwill Allocated by Reportable Segments (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | $373,119 | $372,307 | $371,712 |
Foreign currency translation adjustments | -4,282 | 812 | 595 |
Balance, Ending Balance | 368,837 | 373,119 | 372,307 |
Merchant Acquiring, net [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 138,121 | 138,121 | 138,121 |
Foreign currency translation adjustments | 0 | 0 | 0 |
Balance, Ending Balance | 138,121 | 138,121 | 138,121 |
Payment Processing [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 187,622 | 187,028 | 186,470 |
Foreign currency translation adjustments | -3,394 | 594 | 558 |
Balance, Ending Balance | 184,228 | 187,622 | 187,028 |
Business Solutions [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 47,376 | 47,158 | 47,121 |
Foreign currency translation adjustments | -888 | 218 | 37 |
Balance, Ending Balance | $46,488 | $47,376 | $47,158 |
Goodwill_Additional_Informatio
Goodwill - Additional Information (Detail) (USD $) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Goodwill impairment test fair value in excess of carrying amount percentage | 30.00% | |||
Impairment losses | $0 | $0 | $0 | $0 |
Carrying_Amount_of_Other_Intan
Carrying Amount of Other Intangible Assets (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $547,412 | $530,123 |
Accumulated amortization | -212,828 | -162,343 |
Net carrying amount | 334,584 | 367,780 |
Customer relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 14 years | 14 years |
Gross amount | 312,735 | 314,036 |
Accumulated amortization | -95,482 | -73,180 |
Net carrying amount | 217,253 | 240,856 |
Trademarks [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | 39,950 | 39,950 |
Accumulated amortization | -14,722 | -11,258 |
Net carrying amount | 25,228 | 28,692 |
Trademarks [Member] | Minimum [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 10 years | 10 years |
Trademarks [Member] | Maximum [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 15 years | 15 years |
Software packages [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | 138,188 | 119,598 |
Accumulated amortization | -86,605 | -65,655 |
Net carrying amount | 51,583 | 53,943 |
Software packages [Member] | Minimum [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 3 years | 3 years |
Software packages [Member] | Maximum [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 10 years | 10 years |
Non-compete agreement [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 15 years | 15 years |
Gross amount | 56,539 | 56,539 |
Accumulated amortization | -16,019 | -12,250 |
Net carrying amount | $40,520 | $44,289 |
Other_Intangible_Assets_Additi
Other Intangible Assets - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Other Intangible Assets [Member] | |||
Other Intangible Assets [Line Items] | |||
Amortization expense for intangible assets | $50.50 | $54.20 | $55.10 |
Software packages [Member] | |||
Other Intangible Assets [Line Items] | |||
Amortization expense for intangible assets | $21 | $24.50 | $25.40 |
Estimated_Amortization_Expense
Estimated Amortization Expenses (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2015 | $48,083 |
2016 | 38,025 |
2017 | 34,879 |
2018 | 32,392 |
2019 | $31,593 |
Other_LongTerm_Assets_Addition
Other Long-Term Assets - Additional Information (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Schedule of Other Long Term Assets [Line Items] | ||
Other long-term assets | $10,917,000 | $18,162,000 |
Deferred Debt Issuance Costs [Member] | ||
Schedule of Other Long Term Assets [Line Items] | ||
Deferred finance costs | 9,300,000 | 11,500,000 |
Indemnification Assets [Member] | ||
Schedule of Other Long Term Assets [Line Items] | ||
Other long-term assets | 1,700,000 | |
Software And Services [Member] | ||
Schedule of Other Long Term Assets [Line Items] | ||
Other long-term assets | $1,600,000 | $5,000,000 |
Total_Debt_Detail
Total Debt (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Aug. 31, 2013 | ||
In Thousands, unless otherwise specified | |||||
Debt Instrument [Line Items] | |||||
Other short-term borrowing | $1,200 | $1,800 | |||
Note payable | 4,600 | ||||
Total debt | 693,912 | 735,880 | |||
Term A due on April 17, 2018 [Member] | Senior Secured Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility | 277,239 | [1],[2] | 292,153 | [1],[2] | |
Term B due on April 17, 2020 [Member] | Senior Secured Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility | 389,340 | [2],[3] | 392,527 | [2],[3] | |
Expiring on April 17, 2018 [Member] | Revolving Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Credit facility | 23,000 | 50,000 | |||
Note Payable due on October 1, 2017 [Member] | |||||
Debt Instrument [Line Items] | |||||
Note payable | $4,333 | [2] | |||
[1] | Applicable margin of 2.50% at December 31, 2014 and 2013. | ||||
[2] | Includes unamortized discount. | ||||
[3] | Subject to a minimum rate ("LIBOR floor") of 0.75% plus applicable margin of 2.75% at December 31, 2014 and 2013. |
Total_Debt_Parenthetical_Detai
Total Debt (Parenthetical) (Detail) | 0 Months Ended | 12 Months Ended | |
Apr. 17, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
Note Payable due on October 1, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Debt, maturity date | 1-Oct-17 | ||
Senior Secured Credit Facility [Member] | Term A due on April 17, 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Debt, maturity date | 17-Apr-18 | 17-Apr-18 | 17-Apr-18 |
Margin interest rate | 2.50% | 2.50% | |
Senior Secured Credit Facility [Member] | Term B due on April 17, 2020 [Member] | |||
Debt Instrument [Line Items] | |||
Debt, maturity date | 17-Apr-20 | 17-Apr-20 | 17-Apr-20 |
Senior Secured Credit Facility [Member] | Term B due on April 17, 2020 [Member] | LIBOR Floor [Member] | |||
Debt Instrument [Line Items] | |||
Margin interest rate | 0.75% | 0.75% | |
Senior Secured Credit Facility [Member] | Term B due on April 17, 2020 [Member] | Applicable Margin [Member] | |||
Debt Instrument [Line Items] | |||
Margin interest rate | 2.75% | 2.75% | |
Revolving Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Debt, maturity date | 17-Apr-18 | ||
Revolving Credit Facility [Member] | Expiring on April 17, 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Debt, maturity date | 17-Apr-18 | 17-Apr-18 | 17-Apr-18 |
Debt_and_ShortTerm_Borrowings_1
Debt and Short-Term Borrowings - Additional Information (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2012 | Apr. 17, 2013 | Dec. 31, 2013 | Apr. 29, 2013 | Apr. 30, 2013 | Aug. 31, 2013 | |
Installment | |||||||
Debt Instrument [Line Items] | |||||||
Debt issuance cost | $8,800,000 | ||||||
Maximum secured leverage ratio | 6.6 | ||||||
Debt instrument, term | 8 months | ||||||
Other short-term borrowing, number of payments | 3 | ||||||
Other short-term borrowing | 1,200,000 | 1,800,000 | |||||
Notes payable | 4,600,000 | ||||||
Note Payable [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, term | 36 months | ||||||
Other short-term borrowing, number of payments | 12 | ||||||
Senior Secured Term Loan A [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Secured credit facilities | 277,500,000 | ||||||
Debt, maturity date | 17-Apr-18 | ||||||
Senior Secured Term Loan A [Member] | Commencing On September 30, 2013 To June 2016 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Original principal amount | 1.25% | ||||||
Senior Secured Term Loan A [Member] | Commencing On September 30, 2016 To June 30, 2017 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Original principal amount | 1.88% | ||||||
Senior Secured Term Loan A [Member] | Commencing On September 30, 2017 To March 31, 2018 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Original principal amount | 2.50% | ||||||
Senior Secured Term Loan A [Member] | LIBOR Floor [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 2.00% | ||||||
Senior Secured Term Loan A [Member] | LIBOR Floor [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 2.50% | ||||||
Senior Secured Term Loan A [Member] | Base Rate [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 1.00% | ||||||
Senior Secured Term Loan A [Member] | Base Rate [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 1.50% | ||||||
Senior Secured Term Loan B [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Secured credit facilities | 394,000,000 | ||||||
Debt, maturity date | 17-Apr-20 | ||||||
Original principal amount | 0.25% | ||||||
Debt instrument description | The LIBOR Rate and Base Rate are subject to floors of 0.75% and 1.75%, respectively. | ||||||
Senior Secured Term Loan B [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 0.75% | ||||||
Senior Secured Term Loan B [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 1.75% | ||||||
Senior Secured Term Loan B [Member] | LIBOR Floor [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 2.50% | ||||||
Senior Secured Term Loan B [Member] | LIBOR Floor [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 2.75% | ||||||
Senior Secured Term Loan B [Member] | Base Rate [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 1.50% | ||||||
Senior Secured Term Loan B [Member] | Base Rate [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 1.75% | ||||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Secured credit facilities | 100,000,000 | ||||||
Debt, maturity date | 17-Apr-18 | ||||||
Revolving credit facility, outstanding balance | 23,000,000 | ||||||
Revolving Credit Facility [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Commitment fee for the unused portion | 0.13% | ||||||
Revolving Credit Facility [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Commitment fee for the unused portion | 0.38% | ||||||
Senior Secured Credit Facilities [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Unamortized discount | 6,400,000 | ||||||
Debt issuance cost | 5,900,000 | ||||||
Unamortized discount written off | 3,400,000 | ||||||
Debt issuance cost written off | 3,000,000 | ||||||
New Senior Secured Credit Facilities [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt issuance cost | 7,200,000 | ||||||
Debt issuance cost written off | 4,900,000 | ||||||
Term A due on April 17, 2018 [Member] | Senior Secured Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Secured credit facilities | 300,000,000 | ||||||
Debt, maturity date | 17-Apr-18 | 17-Apr-18 | 17-Apr-18 | ||||
LIBOR rate and base rate percentage | 2.50% | 2.50% | |||||
Term B due on April 17, 2020 [Member] | Senior Secured Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Secured credit facilities | 400,000,000 | ||||||
Debt, maturity date | 17-Apr-20 | 17-Apr-20 | 17-Apr-20 | ||||
Term B due on April 17, 2020 [Member] | Senior Secured Credit Facility [Member] | LIBOR Floor [Member] | |||||||
Debt Instrument [Line Items] | |||||||
LIBOR rate and base rate percentage | 0.75% | 0.75% | |||||
Expiring on April 17, 2018 [Member] | Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Secured credit facilities | 100,000,000 | ||||||
Debt, maturity date | 17-Apr-18 | 17-Apr-18 | 17-Apr-18 | ||||
Senior Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt issuance cost written off | 7,000,000 | ||||||
Satisfaction and Discharge of Indenture description | (i)) at a redemption price of 100.0% plus a make-whole premium and accrued and unpaid interest, on April 30, 2013 (the bFull Redemptionb). On April 17, 2013, the Co-Issuers and the Trustee entered into a Satisfaction and Discharge Agreement whereby EVERTEC Group caused to be irrevocably deposited with the Trustee, to satisfy and to discharge the Co-Issuersb obligations under the Indenture (a) a portion of the net cash proceeds received by the Company in the initial public offering to Holdings, which contributed such proceeds to EVERTEC Group, in an amount sufficient to effect the Partial Redemption on April 29, 2013 and (b) proceeds from the 2013 Credit Agreement described above in an amount sufficient to effect the Full Redemption on April 30, 2013. On April 29, 2013, the Partial Redemption was effected and on April 30, 2013, the Full Redemption was effected. | ||||||
Principal amount of outstanding, redemption value | 91,000,000 | ||||||
Percentage of redemption price | 111.00% | 100.00% | |||||
Debt instrument premium | 1,800,000 | ||||||
Debt redemption premium | $41,900,000 |
Fair_Value_Measurements_for_As
Fair Value Measurements for Assets at Fair Value on Recurring Basis (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Indemnification assets: | ||
Software cost reimbursement | $1,428 | $3,586 |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
Indemnification assets: | ||
Software cost reimbursement | $1,428 | $3,586 |
Financial_Instruments_and_Fair2
Financial Instruments and Fair Value Measurements - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Fair Value Disclosures [Abstract] | |||
Unrealized gain (loss) recognized in other expenses | ($446,000) | ($383,000) | $966,000 |
Termination dates of contracts end | 30-Sep-15 | ||
Merger transaction completed date | 30-Sep-10 | ||
Unobservable inputs related to the Company's indemnification assets, discount rate | 4.75% | ||
Projected cash flows | 1,400,000 | ||
Transfer in or out of Level 3 assets | $0 | $0 | $0 |
Carrying_Value_and_Estimated_F
Carrying Value and Estimated Fair Values for Financial Instruments (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Indemnification assets: | ||
Software cost reimbursement, Carrying Amount | $1,428 | $3,586 |
Indemnification assets: | ||
Software cost reimbursement, Fair Value | 1,428 | 3,586 |
Senior Secured Term Loan A [Member] | ||
Financial liabilities: | ||
Senior secured term loan , Carrying Amount | 277,240 | 292,153 |
Financial liabilities: | ||
Senior secured term loan, Fair Value | 266,400 | 284,091 |
Senior Secured Term Loan B [Member] | ||
Financial liabilities: | ||
Senior secured term loan , Carrying Amount | 389,340 | 392,527 |
Financial liabilities: | ||
Senior secured term loan, Fair Value | $385,462 | $387,055 |
Summary_of_Change_in_Fair_Valu
Summary of Change in Fair Value of Level Three Assets (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Unrealized gain (loss) recognized in other expenses | $446 | $383 | ($966) |
Indemnification Assets [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | 3,586 | 6,099 | 7,464 |
Payments received | -1,712 | -2,130 | -2,331 |
Unrealized gain (loss) recognized in other expenses | -446 | -383 | 966 |
Ending balance | $1,428 | $3,586 | $6,099 |
Equity_Additional_Information_
Equity - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | 0 Months Ended | ||||||||
Oct. 01, 2014 | Dec. 18, 2013 | Dec. 18, 2012 | 9-May-12 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 13, 2013 | Sep. 18, 2013 | Apr. 17, 2013 | Dec. 31, 2011 | |
Statement of Equity [Line Items] | ||||||||||||
Common stock authorized | 206,000,000 | 206,000,000 | 206,000,000 | |||||||||
Common stock par value | $0.01 | $0.01 | ||||||||||
Common stock outstanding | 77,893,144 | 77,893,144 | 78,286,465 | |||||||||
Preferred stock authorized | 2,000,000 | 2,000,000 | 2,000,000 | |||||||||
Preferred stock par value | $0.01 | $0.01 | $0.01 | |||||||||
Preferred stock issued | 0 | 0 | 0 | |||||||||
Net proceeds from Initial Public Offering | $543,000 | $29,000 | $450,000 | |||||||||
Shares repurchased | 1,146,870 | 3,690,036 | 1,201,194 | |||||||||
Repurchase of common stock | 26,200,000 | 26,197,000 | 75,000,000 | |||||||||
Cash distribution to stockholders | 53,400,000 | 269,800,000 | ||||||||||
Excess over accumulated earnings of cash distribution | 52,400,000 | 260,200,000 | ||||||||||
Revolving Credit Facility [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares repurchased, Value using revolving credit facility | 100,000,000 | 100,000,000 | ||||||||||
EVERTEC [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Net proceeds from Initial Public Offering | 543,000 | 29,000 | 450,000 | |||||||||
Repurchase of common stock | 26,197,000 | 75,000,000 | ||||||||||
Common Stock [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Common stock outstanding | 77,893,144 | 77,893,144 | 78,286,465 | 72,846,144 | 72,754,448 | |||||||
Shares issued under Initial and Other Public Offerings | 91,696 | |||||||||||
Shares repurchased | 1,201,194 | 3,690,036 | 3,690,036 | |||||||||
Repurchase of common stock | 25,000,000 | |||||||||||
Common Stock [Member] | Revolving Credit Facility [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares repurchased, Value using revolving credit facility | 50,000,000 | |||||||||||
Apollo Global Management Llc [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 0 | 9,200,000 | ||||||||||
Apollo Global Management Llc [Member] | Common Stock [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 13,739,284 | |||||||||||
Popular [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 11,700,000 | 17,500,000 | ||||||||||
Popular [Member] | Common Stock [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 8,800,659 | |||||||||||
Selling Stockholders [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Common stock par value | $20.60 | 22.5 | ||||||||||
Shares issued under Initial and Other Public Offerings | 15,233,273 | 23,000,000 | ||||||||||
Net proceeds from Initial Public Offering | 0 | 0 | ||||||||||
IPO [Member] | 2013 Credit Agreement [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Net proceeds from Initial Public Offering | $117,400,000 | 117,400,000 | ||||||||||
IPO [Member] | Common Stock [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Common stock par value | 20 | |||||||||||
Shares issued under Initial and Other Public Offerings | 28,789,943 | |||||||||||
IPO [Member] | Common Stock [Member] | EVERTEC [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 6,250,000 | |||||||||||
IPO [Member] | Selling Stockholders [Member] | Common Stock [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 22,539,943 | |||||||||||
IPO [Member] | Selling Stockholders [Member] | Apollo Global Management Llc [Member] | Common Stock [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 13,739,284 | |||||||||||
IPO [Member] | Selling Stockholders [Member] | Popular [Member] | Common Stock [Member] | ||||||||||||
Statement of Equity [Line Items] | ||||||||||||
Shares issued under Initial and Other Public Offerings | 8,800,659 |
Summary_of_Dividend_Activity_D
Summary of Dividend Activity (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Dividends Payable [Line Items] | ||
Declaration Date | 18-Feb-15 | |
Record Date | 2-Mar-15 | |
Payment Date | 19-Mar-15 | |
First Quarter Dividend [Member] | ||
Dividends Payable [Line Items] | ||
Declaration Date | 12-Feb-14 | |
Record Date | 25-Feb-14 | |
Payment Date | 14-Mar-14 | |
Dividend per share | $0.10 | |
Second Quarter Dividend [Member] | ||
Dividends Payable [Line Items] | ||
Declaration Date | 7-May-14 | |
Record Date | 19-May-14 | |
Payment Date | 6-Jun-14 | |
Dividend per share | $0.10 | |
Third Quarter Dividend [Member] | ||
Dividends Payable [Line Items] | ||
Declaration Date | 6-Aug-14 | 7-Aug-13 |
Record Date | 18-Aug-14 | 19-Aug-13 |
Payment Date | 5-Sep-14 | 6-Sep-13 |
Dividend per share | $0.10 | $0.10 |
Fourth Quarter Dividend [Member] | ||
Dividends Payable [Line Items] | ||
Declaration Date | 5-Nov-14 | 6-Nov-13 |
Record Date | 17-Nov-14 | 18-Nov-13 |
Payment Date | 5-Dec-14 | 6-Dec-13 |
Dividend per share | $0.10 | $0.10 |
Sharebased_Compensation_Additi
Share-based Compensation - Additional Information (Detail) (USD $) | 12 Months Ended | 0 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | 9-May-12 | Sep. 30, 2014 | Dec. 18, 2012 | ||
Director | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Nonvested shares, Granted | 100,000 | 150,000 | 1,020,000 | [1] | |||
Stock option per share amount | $0.69 | ||||||
Accrual of unvested portion related to equitable adjustment | $2,800,000 | ||||||
Accrual of the unvested portion of stock option | 45,000 | 600,000 | |||||
Number of directors granted restricted units | 4 | ||||||
Share-based compensation expenses | 4,900,000 | ||||||
Scenario, Adjustment [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Equitable adjustment to reduce exercise price | $3.71 | $3.71 | |||||
Restricted Shares [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expenses | 282,000 | 359,000 | 609,000 | ||||
Maximum unrecognized cost for stock options | 400,000 | ||||||
Unrecognized compensation cost, weighted average period of recognition | 1 year 7 months 2 days | ||||||
Stock Option [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expenses | 4,305,000 | 5,820,000 | 595,000 | ||||
Maximum unrecognized cost for stock options | $1,300,000 | ||||||
Unrecognized compensation cost, weighted average period of recognition | 1 year 11 months 16 days | ||||||
Tranche Two [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Investor internal rate of return, percentage | 25.00% | ||||||
Tranche Three [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Investor internal rate of return, percentage | 30.00% | ||||||
Tranche B and C [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Option vesting condition | Pursuant to the terms of the 2010 Plan, Tranche A stock options will generally vest in five equal installments, except for some grants as specified in the stock agreement, Tranche B options granted to employees and certain directors would vest at such time as the Investor Internal Rate of Return (bIRRb) equals or exceeds 25%, except for one grant that vests upon a 20% IRR, based on cash proceeds received by Apollo Investment Fund VII, L.P. (the bInvestorb), and Tranche C options would vest at such time as the IRR equals or exceeds 30% based on cash proceeds received by the Investor. | ||||||
One Grant [Member] | Tranche Two [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Investor internal rate of return, percentage | 20.00% | ||||||
2010 Equity Incentive Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares reserved for issuance | 5,843,208 | ||||||
Nonvested shares, Granted | 0 | ||||||
Equity Incentive Plans contractual term | 10 years | ||||||
2013 Equity Incentive Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares reserved for issuance | 5,956,882 | ||||||
[1] | Includes 100,000 of stock options that were not granted under the Equity Incentive Plans, but are subject to certain terms of the 2010 Plan. |
Summary_of_Stock_Option_Activi
Summary of Stock Option Activity (Detail) (USD $) | 12 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||
Outstanding shares, Beginning Balance | 1,285,536 | 5,177,582 | 5,388,548 | |||
Outstanding shares, Granted | 100,000 | 150,000 | 1,020,000 | [1] | ||
Outstanding shares, Forfeitures | -31,164 | -1,230,966 | ||||
Outstanding shares, Exercised | -945,040 | [2] | -4,042,046 | [2] | ||
Outstanding shares, Repurchased | -93,332 | |||||
Outstanding shares, Ending Balance | 316,000 | 1,285,536 | 5,177,582 | |||
Outstanding weighted average exercise prices, Beginning Balance | $4.77 | [3] | $2.06 | [3] | $1.30 | [3] |
Outstanding shares, Exercisable, Ending Balance | 50,000 | |||||
Outstanding weighted average exercise prices, Granted | $24.01 | [3] | $23.36 | [3] | $4.95 | [1],[3] |
Outstanding weighted average exercise prices, Forfeitures | $1.30 | [3] | $1.30 | [3] | ||
Outstanding weighted average exercise prices, Exercised | $1.96 | [2],[3] | $1.99 | [2],[3] | ||
Outstanding weighted average exercise prices, Repurchased | $4.83 | [3] | ||||
Outstanding weighted average exercise prices, Ending Balance | $19.56 | [3] | $4.77 | [3] | $2.06 | [3] |
Outstanding weighted average exercise prices, Exercisable, Ending Balance | $23.36 | [3] | ||||
[1] | Includes 100,000 of stock options that were not granted under the Equity Incentive Plans, but are subject to certain terms of the 2010 Plan. | |||||
[2] | At December 31, 2014, the total intrinsic value of options exercised during the year amounted to $19.3 million. | |||||
[3] | Exercise price was retroactively adjusted to reflect the equitable adjustment of $3.71 per share as discussed below. |
Summary_of_Stock_Option_Activi1
Summary of Stock Option Activity (Parenthetical) (Detail) (USD $) | 0 Months Ended | 12 Months Ended |
In Millions, except Share data, unless otherwise specified | 9-May-12 | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total intrinsic value of options exercised | $19.30 | |
Employee Stock Options 2010 Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options not granted under the Equity Incentive Plan | 100,000 | |
Scenario, Adjustment [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equitable adjustment to reduce exercise price | $3.71 | $3.71 |
Fully_Vested_Stock_Options_Det
Fully Vested Stock Options (Detail) (USD $) | 12 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||
Vested stock options, Shares | 766,995 | [1],[2],[3] | 3,757,099 | [1],[2],[3] | 279,750 | [1],[2],[3] |
Vested stock options, Weighted average exercise price | $3.75 | [1],[2],[3] | $2.07 | [1],[2],[3] | $1.30 | [1],[2],[3] |
[1] | At December 31, 2014, 2013 and 2012, the aggregate intrinsic value amounted to $14.0 million, $84.9 million and $1.6 million, respectively. | |||||
[2] | The weighted average contractual term of fully vested options is 6.06 years, 7.04 years and 7.85 years as of December 31, 2014, 2013 and 2012, respectively. | |||||
[3] | The fair value of vested stock options at December 31, 2014, 2013 and 2012 amounted to $17.0 million, $92.7 million and $2.0 million, respectively. |
Fully_Vested_Stock_Options_Par
Fully Vested Stock Options (Parenthetical) (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Share-based compensation arrangement by share-based payment award, Aggregate intrinsic value | $14 | $84.90 | $1.60 |
Share-based compensation arrangement by share-based payment award, Weighted average contractual term | 6 years 22 days | 7 years 15 days | 7 years 10 months 6 days |
Share-based compensation arrangement by share-based payment award, fair value of vested stock options | $17 | $92.70 | $2 |
Assumptions_used_to_Estimate_F
Assumptions used to Estimate Fair Value of Stock Option Granted (Detail) (USD $) | 12 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||
Employee Stock Options 2013 Plan [Member] | ||||||
Share based Compensation Arrangement Assumptions Used to Estimate Fair Values of Share Options Granted [Line Items] | ||||||
Stock Price | $24.01 | [1] | $23.36 | [1] | ||
Risk-free rate | 1.80% | 1.68% | ||||
Expected volatility | 36.98% | 36.56% | ||||
Expected annual dividend yield | 1.63% | 1.71% | ||||
Expected term | 6 years | 6 years | ||||
Employee Stock Options 2010 Plan [Member] | ||||||
Share based Compensation Arrangement Assumptions Used to Estimate Fair Values of Share Options Granted [Line Items] | ||||||
Stock Price | $5.19 | [1] | ||||
Risk-free rate | 0.59% | |||||
Expected volatility | 31.12% | |||||
Expected annual dividend yield | 0.00% | |||||
Expected term | 3 years 10 months 13 days | |||||
[1] | As discussed above, on May 9, 2012 an equitable adjustment to stock options was approved which caused a reduction of $3.71 per share of the exercise price of the outstanding options. Accordingly, the stock price presented above reflects this equitable adjustment for 2012. |
Assumptions_used_to_Estimate_F1
Assumptions used to Estimate Fair Value of Stock Option Granted (Parenthetical) (Detail) (Scenario, Adjustment [Member], USD $) | 0 Months Ended | 12 Months Ended |
9-May-12 | Dec. 31, 2014 | |
Scenario, Adjustment [Member] | ||
Share based Compensation Arrangement Assumptions Used to Estimate Fair Values of Share Options Granted [Line Items] | ||
Equitable adjustment to reduce exercise price | $3.71 | $3.71 |
Nonvested_Restricted_Shares_Ac
Nonvested Restricted Shares Activity (Detail) (Restricted Shares [Member], USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Restricted Shares [Member] | |||
Nonvested restricted shares | |||
Nonvested shares, Beginning balance | 9,133 | 115,420 | 126,116 |
Outstanding shares, Granted | 23,252 | 9,133 | 29,292 |
Outstanding shares, Vested | -9,133 | -115,420 | -39,988 |
Nonvested shares, Ending Balance | 23,252 | 9,133 | 115,420 |
Weighted-average grant date fair value | |||
Weighted-average grant date fair value, beginning balance | $24.64 | $5.90 | $5 |
Outstanding weighted average exercise prices, Granted | $22.04 | $24.64 | $8.54 |
Outstanding weighted average exercise prices, Vested | $24.64 | $5.90 | $5 |
Weighted-average grant date fair value, Ending balance | $22.04 | $24.64 | $5.90 |
Sharebased_Compensation_Recogn
Share-based Compensation Recognized (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation recognized, net | $4,900 | ||
Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation recognized, net | 4,305 | 5,820 | 595 |
Restricted Shares [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation recognized, net | $282 | $359 | $609 |
Employee_Benefit_Plan_Addition
Employee Benefit Plan - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Compensation and Retirement Disclosure [Abstract] | |||
Defined contribution saving plan, vesting period | 5 years | ||
Defined contribution saving plan cost | $0.60 | $0.60 | $0.60 |
Total_Other_Income_Expenses_Ad
Total Other Income (Expenses) - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Other Income Expense [Line Items] | |||
Other income (expenses), foreign currency transaction gains | $2,600,000 | ||
Other income (expenses), adjustments | -2,375,000 | 500,000 | 8,491,000 |
Expenses on extinguishment of debt | -58,464,000 | ||
Expense related to termination of consulting agreements | 16,718,000 | ||
Other expenses, debt issuance costs | 8,800,000 | ||
Other expense, personnel separation charges | 2,200,000 | ||
Other expense, gain in foreign exchange transactions | 1,300,000 | ||
Software Indemnification Assets [Member] | |||
Other Income Expense [Line Items] | |||
Other income (expenses), adjustments | 400,000 | ||
Apollo and Popular [Member] | |||
Other Income Expense [Line Items] | |||
Expense related to termination of consulting agreements | $16,700,000 |
Components_of_Income_Tax_Expen
Components of Income Tax Expense (Benefit) (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | |||
Current tax provision | $9,291 | $3,712 | $6,910 |
Deferred tax benefit | -1,713 | -5,702 | -66,568 |
Income tax expense (benefit) | $7,578 | ($1,990) | ($59,658) |
Income_Tax_Additional_Informat
Income Tax - Additional Information (Detail) (USD $) | 0 Months Ended | 6 Months Ended | 12 Months Ended | 0 Months Ended | |||||
Oct. 11, 2011 | Jun. 30, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2010 | Dec. 01, 2013 | Oct. 19, 2012 | Jun. 30, 2013 | |
Income Tax Examination [Line Items] | |||||||||
Adjustment to deferred taxes due to changes in enacted tax rate | $1,400,000 | $485,000 | $1,441,000 | ($66,423,000) | |||||
Unremitted earnings for foreign subsidiaries | 22,000,000 | ||||||||
Preferential tax rate | 7.00% | 4.00% | |||||||
Tax exemption, conditions | The grant contains customary commitments, conditions and representations that EVERTEC Group will be required to comply with in order to maintain the grant. The more significant commitments include (i) maintaining at least 750 employees in EVERTEC Group's Puerto Rico data processing operations during 2012 and at least 700 employees for the remaining years of the grant; and (ii) investing at least $200.0 million in building, machinery, equipment or computer programs to be used | ||||||||
Commitments to maintain tax exemption grant, investments | 200,000,000 | ||||||||
Commitments to maintain tax exemption grant, investment increment over four year cycle | 50,000,000 | ||||||||
Tax exemption expiration date | 11/1/24 | ||||||||
Total available gross net operating loss | 7,000,000 | ||||||||
Future realized windfall tax benefit | 4,200,000 | ||||||||
Net operating loss carried forward expires | 31-Dec-23 | 31-Dec-22 | |||||||
Open tax uncertainty positions | 0 | 0 | |||||||
Unrecognized tax benefits | 0 | ||||||||
Development Services [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Base tax rate | 7.00% | ||||||||
Base tax rate period | 10 years | ||||||||
During 2012 [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Commitments to maintain tax exemption grant, minimum number of employees to be maintained | 750 | ||||||||
For the remaining years of the grant [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Commitments to maintain tax exemption grant, minimum number of employees to be maintained | 700 | ||||||||
Scenario Forecast [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Preferential tax rate | 4.00% | ||||||||
Income Tax [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Tax exemption period | 15 years | ||||||||
Tax exemption period, effective date | 1-Jan-12 | ||||||||
Municipal Taxes [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Tax exemption period | 15 years | ||||||||
Tax exemption period, effective date | 1-Jan-13 | ||||||||
Percentage of income tax exemption | 60.00% | ||||||||
Property Taxes [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Percentage of income tax exemption | 90.00% | ||||||||
Windfall [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Total available gross net operating loss | 28,900,000 | ||||||||
Future realized windfall tax benefit | 10,800,000 | ||||||||
Minimum [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Reduction in deferred tax liability | ($66,400,000) | ||||||||
Corporate income tax | 4.00% | 30.00% | |||||||
Maximum [Member] | |||||||||
Income Tax Examination [Line Items] | |||||||||
Corporate income tax | 30.00% | 39.00% |
Segregation_of_Income_Tax_Expe
Segregation of Income Tax Expense (Benefit) Based on Location of Operations (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income (loss) before income tax provision (benefit) | |||
Income (loss) before income taxes | $75,110 | ($26,611) | $17,708 |
Current tax provision (benefit) | |||
Current tax provision (benefit), Puerto Rico | 4,779 | 913 | 4,661 |
Current tax provision (benefit), United States | -517 | 753 | 622 |
Current tax provision (benefit), Foreign countries | 5,029 | 2,046 | 1,627 |
Total current tax provision | 9,291 | 3,712 | 6,910 |
Deferred tax benefit | |||
Deferred tax provision (benefit), Puerto Rico | -56 | -5,094 | -65,822 |
Deferred tax provision (benefit) , United States | -124 | -5 | -38 |
Deferred tax provision (benefit), Foreign countries | -1,645 | -603 | -708 |
Total deferred tax benefit | -1,713 | -5,702 | -66,568 |
Puerto Rico [Member] | |||
Income (loss) before income tax provision (benefit) | |||
Income (loss) before income taxes | 61,395 | -35,255 | 9,941 |
United States [Member] | |||
Income (loss) before income tax provision (benefit) | |||
Income (loss) before income taxes | 2,131 | 2,031 | 1,534 |
Foreign Countries [Member] | |||
Income (loss) before income tax provision (benefit) | |||
Income (loss) before income taxes | $11,584 | $6,613 | $6,233 |
Components_of_Deferred_Tax_Ass
Components of Deferred Tax Assets and Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Deferred tax assets ("DTA") | ||
Allowance for doubtful accounts | $346 | $330 |
Net operating loss | 7,076 | 11,306 |
Other temporary assets | 2,302 | 1,845 |
Total gross deferred tax assets | 9,724 | 13,481 |
Deferred tax liabilities ("DTL") | ||
Deferred compensation | 1,145 | 993 |
Difference between the assigned values and the tax basis of assets and liabilities recognized in purchase | 24,735 | 28,849 |
Debt issue cost | 1,232 | 1,680 |
Other temporary liabilities | -314 | 177 |
Total gross deferred tax liabilities | 26,798 | 31,699 |
Deferred tax liability, net | ($17,074) | ($18,218) |
Income_Tax_Expense_Benefit_Dif
Income Tax Expense (Benefit) Differs from Computed Income Tax at Statutory Rates (Detail) (USD $) | 6 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | ||||
Computed income tax at statutory rates | $29,293 | ($10,378) | $5,313 | |
Benefit of net tax-exempt interest income | -180 | -13 | ||
Tax expense (benefit) due to a change in estimate | -916 | 83 | 320 | |
Adjustment to deferred taxes due to changes in enacted tax rate and tax grant | 1,400 | 485 | 1,441 | -66,423 |
Effect of net disallowed operating losses in foreign entities | 83 | 93 | 1,012 | |
Differences in tax rates due to multiple jurisdictions | -942 | 577 | 720 | |
Effect of income subject to tax-exemption grant | -20,425 | 7,164 | -58 | |
Reversal of tax uncertainties reserve | -846 | -707 | ||
Fair value adjustment of indemnification assets | 340 | |||
Other | 56 | -162 | ||
Income tax expense (benefit) | $7,578 | ($1,990) | ($59,658) |
Schedule_of_Reconciliation_of_
Schedule of Reconciliation of Numerator and Denominator of Earnings Per Common Share (Detail) (USD $) | 12 Months Ended | ||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||
Earnings Per Share [Abstract] | |||||
Net income (loss) | $67,532 | ($24,621) | $77,366 | ||
Weighted average common shares outstanding | 78,337,152 | 78,914,310 | 72,687,622 | ||
Weighted average potential dilutive common shares | 553,987 | [1],[2] | 3,948,795 | [1],[2] | |
Weighted average common shares outstanding-assuming dilution | 78,891,139 | 78,914,310 | 76,636,417 | ||
Net income (loss) per common share-basic | $0.86 | ($0.31) | $1.06 | ||
Net income (loss) per common share-diluted | $0.86 | ($0.31) | $1.01 | ||
[1] | Potential common shares consist of common stock issuable under the assumed exercise of stock options and restricted stock awards using the treasury stock method. | ||||
[2] | For the year ended December 31, 2013, 2,325,209 potential common shares consisting of common stock under the assumed exercise of stock options and restricted stock awards using the treasury stock method were not included in the computation of the diluted net income (loss) per share since their inclusion would have an antidilutive effect. |
Schedule_of_Reconciliation_of_1
Schedule of Reconciliation of Numerator and Denominator of Earnings Per Common Share (Parenthetical) (Detail) | 12 Months Ended |
Dec. 31, 2013 | |
Earnings Per Share [Abstract] | |
Common shares excluded from the calculation of diluted net income (loss) per share | 2,325,209 |
Transactions_with_Related_Part
Transactions with Related Parties (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Transaction [Abstract] | ||||||
Total revenues | $164,142 | [1],[2] | $167,325 | [1],[2] | $155,112 | [1],[2] |
Cost of revenues | 1,342 | 8,290 | 426 | |||
Rent and other fees | 7,928 | [3],[4] | 27,762 | [3],[4] | 11,319 | [3],[4] |
Interest earned from and charged by affiliate | ||||||
Interest income | 197 | 130 | 222 | |||
Interest expense | $2,471 | [5] | $7,476 | [5] | ||
[1] | Total revenues from Popular as a percentage of revenues were 45%, 46% and 44% for each of the periods presented above. | |||||
[2] | Includes revenues generated from investee accounted for under the equity method of $2.5 million, $3.0 million and $3.7 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||
[3] | Includes management fees to equity sponsors amounting to $3.5 million and $3.7 million for the years ended December 31, 2013 and 2012, respectively. Management fees paid during 2013 also includes $16.7 million resulting from the termination of the consulting agreements as explained below. Rent and other fees also include $5.9 million paid in connection with the redemption premium on the senior notes during the first half of 2013. | |||||
[4] | Includes $7.9 million, $11.1 million and $11.3 million recorded as selling, general and administrative expenses for each of the periods presented above, and $16.7 million recorded as non-operating expenses for the year ended December 31, 2013 in the audited consolidated statement of income (loss) and comprehensive income (loss). | |||||
[5] | Interest expense relates to interest accrued on the senior secured term loan and senior notes held by Popular. As a result of the debt refinancing and the redemption of the senior notes in April 2013, Popular's participation in such debt was extinguished. See Note 11 for additional information related to the extinguishment of this debt. |
Transactions_with_Related_Part1
Transactions with Related Parties (Parenthetical) (Detail) (USD $) | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||
Transactions with Third Party [Line Items] | |||||||
Revenues generated from investee accounted for under equity method | 2,500,000 | 3,000,000 | 3,700,000 | ||||
Management fee paid for termination of consulting agreement | 16,718,000 | ||||||
Rent and other fees | 7,928,000 | [1],[2] | 27,762,000 | [1],[2] | 11,319,000 | [1],[2] | |
Selling, general and administrative expense | 41,276,000 | 38,810,000 | 31,686,000 | ||||
Non operating expense | -22,238,000 | -112,372,000 | -61,938,000 | ||||
Popular [Member] | |||||||
Transactions with Third Party [Line Items] | |||||||
Total revenues from Popular | 45.00% | 46.00% | 44.00% | ||||
Rent and other fees | 5,900,000 | ||||||
Related Party Transactions [Member] | |||||||
Transactions with Third Party [Line Items] | |||||||
Management fees to equity sponsors | 3,500,000 | 3,700,000 | |||||
Selling, general and administrative expense | 7,900,000 | 11,100,000 | 11,300,000 | ||||
Non operating expense | 16,700,000 | ||||||
[1] | Includes management fees to equity sponsors amounting to $3.5 million and $3.7 million for the years ended December 31, 2013 and 2012, respectively. Management fees paid during 2013 also includes $16.7 million resulting from the termination of the consulting agreements as explained below. Rent and other fees also include $5.9 million paid in connection with the redemption premium on the senior notes during the first half of 2013. | ||||||
[2] | Includes $7.9 million, $11.1 million and $11.3 million recorded as selling, general and administrative expenses for each of the periods presented above, and $16.7 million recorded as non-operating expenses for the year ended December 31, 2013 in the audited consolidated statement of income (loss) and comprehensive income (loss). |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Transactions with Third Party [Line Items] | ||
Software costs reimbursement, Carrying Amount | $1,428,000 | $3,586,000 |
Letter of credit issued by Popular | 3,600,000 | |
Software packages [Member] | ||
Transactions with Third Party [Line Items] | ||
Expected reimbursement asset recorded on merger date | 11,200,000 | |
Expected reimbursement asset, period | 5 years | |
Software packages [Member] | Current Asset [Member] | ||
Transactions with Third Party [Line Items] | ||
Software costs reimbursement, Carrying Amount | 1,400,000 | 1,900,000 |
Software packages [Member] | Noncurrent Assets [Member] | ||
Transactions with Third Party [Line Items] | ||
Software costs reimbursement, Carrying Amount | 1,700,000 | 1,700,000 |
Apollo Management [Member] | ||
Transactions with Third Party [Line Items] | ||
Termination fee | 8,500,000 | |
Popular [Member] | ||
Transactions with Third Party [Line Items] | ||
Termination fee | $8,200,000 | |
Service contract period | 15 years |
Summary_of_Balances_of_Transac
Summary of Balances of Transactions with Related Parties (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Related Party Transactions [Abstract] | ||||
Cash and restricted cash deposits in affiliated bank | $13,566 | $13,933 | ||
Indemnification assets from Popular reimbursement | ||||
Accounts receivable | 1,428 | [1] | 1,900 | [1] |
Other long-term assets | 1,686 | [1] | ||
Other due/to from affiliate | ||||
Accounts receivable | 17,006 | 18,799 | ||
Prepaid expenses and other assets | 1,141 | 216 | ||
Accounts payable | 5,260 | 8,886 | ||
Unearned income | 8,154 | 4,100 | ||
Other long-term liabilities | $45 | [2] | $333 | [2] |
[1] | Recorded in connection with reimbursement from Popular regarding certain software license fees. | |||
[2] | Includes an account payable of $0.2 million for both December 31, 2014 and 2013 and a long-term liability of $45,000 and $0.3 million for December 31, 2014 and 2013, respectively, related to the unvested portion of stock options as a result of the equitable adjustment approved by the Company's Board of Directors on December 18, 2012 that will be payable to executive officers and employees upon vesting of stock options. |
Summary_of_Balances_of_Transac1
Summary of Balances of Transactions with Related Parties (Parenthetical) (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | ||
Transactions with Third Party [Line Items] | ||||
Accounts payable | $5,260,000 | $8,886,000 | ||
Other long-term liabilities | 45,000 | [1] | 333,000 | [1] |
Unvested Stock Options [Member] | ||||
Transactions with Third Party [Line Items] | ||||
Accounts payable | 200,000 | 200,000 | ||
Other long-term liabilities | $45,000 | $300,000 | ||
[1] | Includes an account payable of $0.2 million for both December 31, 2014 and 2013 and a long-term liability of $45,000 and $0.3 million for December 31, 2014 and 2013, respectively, related to the unvested portion of stock options as a result of the equitable adjustment approved by the Company's Board of Directors on December 18, 2012 that will be payable to executive officers and employees upon vesting of stock options. |
Future_Minimum_Rental_Payments
Future Minimum Rental Payments on Operating Leases (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Operating Leased Assets [Line Items] | |
2015 | $4,725 |
2016 | 4,582 |
2017 | 4,470 |
2018 | 4,483 |
2019 and thereafter | 5,780 |
Total Future minimum rental payments | 24,040 |
Unrelated Parties [Member] | |
Operating Leased Assets [Line Items] | |
2015 | 625 |
2016 | 356 |
2017 | 118 |
Total Future minimum rental payments | 1,099 |
Related Party [Member] | |
Operating Leased Assets [Line Items] | |
2015 | 4,100 |
2016 | 4,226 |
2017 | 4,352 |
2018 | 4,483 |
2019 and thereafter | 5,780 |
Total Future minimum rental payments | $22,941 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Commitments and Contingencies [Line Items] | ||
Rent expense of office facilities and real estate | $8.20 | $7.70 |
Rent expense for telecommunications and other equipment | 6.1 | 7 |
Outstanding letter of credit | $1 | |
Maximum [Member] | ||
Commitments and Contingencies [Line Items] | ||
Outstanding letter of credit, maturity term | 3 months |
Segment_Information_Additional
Segment Information - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Segment | |||
Segment Reporting Information [Line Items] | |||
Number of operating business segments | 3 | ||
Amount of revenue from major customer of total revenue | $361,129 | $358,017 | $342,490 |
Major Customer [Member] | Sales Revenue, Net [Member] | |||
Segment Reporting Information [Line Items] | |||
Amount of revenue from major customer of total revenue | $161,600 | $163,800 | $151,400 |
Major Customer [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from next largest customer, percentage of total revenue | 45.00% | 46.00% | 44.00% |
Puerto Rico [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from next largest customer, percentage of total revenue | 10.00% | 11.00% | 9.00% |
Information_about_Operations_b
Information about Operations by Business Segments (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Segment Reporting Information [Line Items] | ||||||
Revenues | $361,129 | $358,017 | $342,490 | |||
Income from operations | 97,348 | 85,761 | 79,646 | |||
Operating Segments [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Income from operations | 141,817 | 132,235 | 127,363 | |||
Operating Segments [Member] | Merchant Acquiring, net [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | 79,136 | 73,616 | 69,591 | |||
Income from operations | 34,348 | 35,376 | 33,836 | |||
Operating Segments [Member] | Payment Processing [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | 132,091 | 125,610 | 116,825 | |||
Income from operations | 59,882 | 54,429 | 53,682 | |||
Operating Segments [Member] | Business Solutions [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | 176,570 | 184,297 | 177,292 | |||
Income from operations | 47,587 | 42,430 | 39,845 | |||
Segment Reconciling Items [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Income from operations | -44,469 | [1] | -46,474 | [1] | -47,717 | [1] |
Other [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | ($26,668) | [2] | ($25,506) | [2] | ($21,218) | [2] |
[1] | Primarily represents non-operating depreciation and amortization expenses generated as a result of the Merger and certain non-recurring fees and expenses. | |||||
[2] | Represents the elimination of intersegment revenues for services provided by the Payment Processing segment to the Merchant Acquiring segment, and other miscellaneous intersegment revenues. |
Reconciliation_of_Income_from_
Reconciliation of Income from Operations to Consolidated Net Income (Loss) (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Segment income from operations | ||||||
Income from operations | $97,348 | $85,761 | $79,646 | |||
Interest expense, net | -25,753 | -37,625 | -54,011 | |||
Earnings of equity method investment | 1,140 | 935 | 564 | |||
Other expenses | 2,375 | -75,682 | -8,491 | |||
Income tax (expense) benefit | -7,578 | 1,990 | 59,658 | |||
Net income (loss) | 67,532 | -24,621 | 77,366 | |||
Operating Segments [Member] | ||||||
Segment income from operations | ||||||
Income from operations | 141,817 | 132,235 | 127,363 | |||
Operating Segments [Member] | Merchant Acquiring, net [Member] | ||||||
Segment income from operations | ||||||
Income from operations | 34,348 | 35,376 | 33,836 | |||
Operating Segments [Member] | Payment Processing [Member] | ||||||
Segment income from operations | ||||||
Income from operations | 59,882 | 54,429 | 53,682 | |||
Operating Segments [Member] | Business Solutions [Member] | ||||||
Segment income from operations | ||||||
Income from operations | 47,587 | 42,430 | 39,845 | |||
Segment Reconciling Items [Member] | ||||||
Segment income from operations | ||||||
Income from operations | ($44,469) | [1] | ($46,474) | [1] | ($47,717) | [1] |
[1] | Primarily represents non-operating depreciation and amortization expenses generated as a result of the Merger and certain non-recurring fees and expenses. |
Geographic_Segment_Information
Geographic Segment Information Based on Geographic Location of Subsidiaries (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Revenues | ||||||
Revenues | $361,129 | $358,017 | $342,490 | |||
Puerto Rico [Member] | ||||||
Revenues | ||||||
Revenues | 312,569 | [1] | 309,350 | [1] | 295,285 | [1] |
Caribbean [Member] | ||||||
Revenues | ||||||
Revenues | 13,752 | [1] | 16,225 | [1] | 16,280 | [1] |
Latin America [Member] | ||||||
Revenues | ||||||
Revenues | $34,808 | [1] | $32,442 | [1] | $30,925 | [1] |
[1] | Revenues are based on subsidiaries' country of domicile. |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (USD $) | 12 Months Ended | 0 Months Ended |
Dec. 31, 2014 | Feb. 28, 2015 | |
Subsequent Event [Line Items] | ||
Common stock dividends payable, date declared | 18-Feb-15 | |
Common stock dividends payable, date to be paid | 19-Mar-15 | |
Common stock dividends payable, date of record | 2-Mar-15 | |
Subsequent Events [Member] | ||
Subsequent Event [Line Items] | ||
Cash dividend declared, Common stock | $0.10 |
Schedule_I_Condensed_Balance_S
Schedule I Condensed Balance Sheets (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Current assets: | ||||
Cash | $32,114 | $22,485 | $25,634 | $56,200 |
Accounts receivable, net | 75,810 | 68,434 | ||
Prepaid expenses and other assets | 20,565 | 19,482 | ||
Deferred tax asset | 399 | 2,537 | ||
Total current assets | 134,606 | 118,371 | ||
Investment in subsidiaries, at equity | 11,756 | 10,639 | ||
Total assets | 890,235 | 921,311 | ||
Current Liabilities: | ||||
Accrued liabilities | 26,052 | 26,571 | ||
Accounts payable | 22,879 | 20,588 | ||
Deferred tax liability | 1,799 | 543 | ||
Total current liabilities | 104,511 | 123,756 | ||
Long-term deferred tax liability, net | 15,674 | 20,212 | ||
Other long-term liabilities | 2,898 | 333 | ||
Total liabilities | 770,662 | 809,981 | ||
Stockholders' equity: | ||||
Common stock | 779 | 783 | ||
Additional paid-in capital | 59,740 | 80,718 | ||
Accumulated earnings | 65,576 | 29,403 | ||
Accumulated other comprehensive income (loss), net of tax of $0 and $0 | -6,522 | 426 | ||
Total stockholders' equity | 119,573 | 111,330 | 122,455 | 366,176 |
Total liabilities and stockholders' equity | 890,235 | 921,311 | ||
EVERTEC [Member] | ||||
Current assets: | ||||
Cash | 1,612 | 1,285 | 557 | 2,677 |
Accounts receivable, net | 3,224 | |||
Prepaid expenses and other assets | 3,690 | 11,574 | ||
Deferred tax asset | 2,494 | |||
Total current assets | 8,526 | 15,353 | ||
Investment in subsidiaries, at equity | 123,017 | 111,931 | ||
Total assets | 131,543 | 127,284 | ||
Current Liabilities: | ||||
Accrued liabilities | 49 | 1,309 | ||
Accounts payable | 5 | |||
Deferred tax liability | 1,421 | |||
Total current liabilities | 1,475 | 1,309 | ||
Long-term deferred tax liability, net | 10,451 | 14,312 | ||
Other long-term liabilities | 44 | 333 | ||
Total liabilities | 11,970 | 15,954 | ||
Stockholders' equity: | ||||
Common stock | 779 | 783 | ||
Additional paid-in capital | 59,740 | 80,718 | ||
Accumulated earnings | 65,576 | 29,403 | ||
Accumulated other comprehensive income (loss), net of tax of $0 and $0 | -6,522 | 426 | ||
Total stockholders' equity | 119,573 | 111,330 | ||
Total liabilities and stockholders' equity | $131,543 | $127,284 |
Schedule_I_Condensed_Statement
Schedule I Condensed Statements of Income and Comprehensive Income (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Non-operating income (expenses) | |||
Equity in earnings (losses) of subsidiaries | $1,140 | $935 | $564 |
Interest income | 328 | 236 | 320 |
Other expenses | 2,375 | -75,682 | -8,491 |
Total non-operating expenses | -22,238 | -112,372 | -61,938 |
Income (loss) before income taxes | 75,110 | -26,611 | 17,708 |
Income tax expense (benefit) | 7,578 | -1,990 | -59,658 |
Net income (loss) | 67,532 | -24,621 | 77,366 |
Other comprehensive income (loss), net of tax Foreign currency translation adjustments | -6,948 | 1,268 | 476 |
Total comprehensive income (loss) | 60,584 | -23,353 | 77,842 |
EVERTEC [Member] | |||
Non-operating income (expenses) | |||
Equity in earnings (losses) of subsidiaries | 74,134 | -23,668 | 95,382 |
Interest income | 227 | 144 | 5 |
Other expenses | -1,994 | -4,780 | -375 |
Total non-operating expenses | 72,367 | -28,304 | 95,012 |
Income (loss) before income taxes | 72,367 | -28,304 | 95,012 |
Income tax expense (benefit) | 4,835 | -3,684 | 17,646 |
Net income (loss) | 67,532 | -24,621 | 77,366 |
Other comprehensive income (loss), net of tax Foreign currency translation adjustments | -6,948 | 1,268 | 476 |
Total comprehensive income (loss) | $60,584 | ($23,353) | $77,842 |
Schedule_I_Condensed_Statement1
Schedule I Condensed Statements of Cash Flows (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Condensed Financial Statements, Captions [Line Items] | |||
Cash flows from operating activities | $139,948 | $62,867 | $82,664 |
Cash flows from financing activities | |||
Proceeds from initial public offering, net of offering costs of $12,567 | 112,432 | ||
Dividends paid | -31,359 | -16,390 | -319,959 |
Repurchase of common stock | -26,197 | -75,000 | |
Statutory minimum withholding taxes paid on cashless exercises of stock options | -2,001 | -16,851 | |
Tax windfall benefits on exercises of stock options and vesting of restricted stocks | 3,669 | 1,829 | |
Issuance of common stock | 543 | 29 | 450 |
Settlement of stock options | -1,604 | ||
Net cash (used in) provided by financing activities | -104,149 | -37,072 | -86,188 |
Net increase (decrease) in cash | 9,629 | -3,149 | -30,566 |
Cash at beginning of the period | 22,485 | 25,634 | 56,200 |
Cash at end of the period | 32,114 | 22,485 | 25,634 |
Supplemental disclosure of non-cash activities: | |||
Liability related to unvested portion of stock options as a result of equitable adjustment (Note 14) | 3,151 | ||
EVERTEC [Member] | |||
Condensed Financial Statements, Captions [Line Items] | |||
Cash flows from operating activities | 57,276 | -5,322 | 317,389 |
Cash flows from financing activities | |||
Proceeds from initial public offering, net of offering costs of $12,567 | 112,432 | ||
Dividends paid | -31,359 | -16,390 | -319,959 |
Repurchase of common stock | -26,197 | -75,000 | |
Statutory minimum withholding taxes paid on cashless exercises of stock options | -2,001 | -16,851 | |
Tax windfall benefits on exercises of stock options and vesting of restricted stocks | 3,669 | 1,829 | |
Issuance of common stock | 543 | 29 | 450 |
Settlement of stock options | -1,604 | ||
Net cash (used in) provided by financing activities | -56,949 | 6,049 | -319,509 |
Net increase (decrease) in cash | 327 | 727 | -2,120 |
Cash at beginning of the period | 1,285 | 557 | 2,677 |
Cash at end of the period | 1,612 | 1,285 | 557 |
Supplemental disclosure of non-cash activities: | |||
Transfer of prepaid income taxes from subsidiary | 6,719 | ||
Liability related to unvested portion of stock options as a result of equitable adjustment (Note 14) | $3,151 |
Schedule_I_Condensed_Statement2
Schedule I Condensed Statements of Cash Flows (Parenthetical) (Detail) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
Condensed Financial Statements, Captions [Line Items] | |
Proceeds from initial public offering, net of cost of offering | $12,567 |
EVERTEC [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Proceeds from initial public offering, net of cost of offering | $12,567 |
Schedule_I_Condensed_Financial1
Schedule I Condensed Financial Statements Parent Company Only - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | |||||||||
In Millions, except Share data, unless otherwise specified | Dec. 04, 2014 | Oct. 01, 2014 | Sep. 04, 2014 | Jun. 05, 2014 | Mar. 13, 2014 | Dec. 18, 2013 | Dec. 01, 2013 | Aug. 31, 2013 | Dec. 18, 2012 | 9-May-12 | Dec. 31, 2014 |
Equity [Abstract] | |||||||||||
Cash distribution received | $7.80 | $25 | $7.90 | $7.80 | $7.80 | $75 | $8.20 | $8.20 | $50.30 | $269.80 | |
Repurchase of common stock | 1,146,870 | 3,690,036 | 1,201,194 |