ACI Worldwide (ACIW) 8-K Regulation FD Disclosure

1

WELCOME

Exhibit 99.1

Private

Securities

Litigation

Reform

Act

of

1995

SAFE

HARBOR

FOR

FORWARD-LOOKING

STATEMENTS

This

presentation

contains

forward-looking

statements

based

on

current

expectations

that

involve

a

number

of

risks

and

uncertainties.

The

forward-

looking

statements

are

made

pursuant

to

safe

harbor

provisions

of

the

Private

Securities

Litigation

Reform

Act

of

1995.

A

discussion

of

these

forward-looking

statements

and

risk

factors

that

may

affect

them

is

set

forth

at

the

end

of

this

presentation.

The

Company

assumes

no

obligation

to

update

any

forward-looking

statement

in

this

presentation,

except

as

required

by

law.

2

Corporate Vision and Strategy

Phil Heasley

President & CEO

November 14, 2013

3

Corporate Marketing

Carl Gustin

SVP, Chief Marketing Officer

November 14, 2013

4

ACI Business Plan Models

Differentiation,

value, gold standard

–

leading solutions

PRODUCT

INNOVATION

Highest efficiency,

lowest cost, high

value and flexible

solutions

OPERATIONAL

EXCELLENCE

Low attrition,

high satisfaction,

maximize margins

CUSTOMER

INTIMACY

5

Corporate

Marketing

ACI Business Plan Models

Global Markets

PRODUCT

INNOVATION

OPERATIONAL

EXCELLENCE

CUSTOMER

INTIMACY

ACI On Demand

Customer

Management

6

Corporate

Marketing

7

Market Profile: Sizing

IDC analysis shows ACI is

in about a $20B market,

growing to about $26B in

2018, a projected CAGR of

7-8%*

Biller market for EBPP services

represents a new significant

opportunity for ACI of ~$6B

(bottom-up analysis)

Per IDC data, ACI share does

not exceed 10% in any segment

ACI has significant room to grow

market share in all current

segments, regardless of market

growth rates

*Variability of data due to segment definitions and

classifications, combinations of data.

8

Market Profile: Competition

CORE

–

Traditional

competitors operating closely

to ACI in certain regions e.g.

OpenWay, Clear2Pay, Alaric

TANGENTIAL

–

Significant

industry players, occasional

customer, might be a threat

SECONDARY

–

Larger

competitors, occasionally

customers

Corporate Marketing

9

Market Profile: Competition

FUNDTECH

ACTIMIZE

ALARIC

LUSIS

OPENWAY

IBM

VISA

MASTERCARD

SAP

CSC

JACK HENRY

LOGICA

BPC

DOVETAIL

C2P

BOTTOMLINE

FIS

FISERV

Corporate

Marketing

Market Profile Summary

•

Category growing at about

7-8% overall.*

•

ACI growing at a mid to high

single digit rate overall.

•

ACI is gaining share with fastest

growth in AOD (hosted SaaS

solutions).

•

IDC projects growth rates to

maintain trajectory through 2018.

*Variability of data due to segment definitions and

classifications, combinations of data.

Corporate

Marketing

10

Market Trends

MACRO

THE BUSINESS OF PAYMENTS

Corporate

Marketing

11

•

Return to normal growth for

global economy not yet realized.

•

Emerging economies no longer

simply “emerging”.

•

FI’s under pressure to overhaul their

business models.

•

Online, real-time and ubiquitous

access will transform Retail and

Wholesale banking.

Market Trends

MARKET PRESSURES

TECHNOLOGY

Corporate Marketing

12

•

Consumer expectations changing

dramatically.

•

Global regulation continues to

pressure ACI customers’

margins.

•

FI’s SOA and ISO2022 are the

architectural preference of the

technology buyer.

•

Expensive legacy systems in

maintenance mode stalling migration

to new technologies.

Strategic Imperatives

Online, real-time

transcends all

other trends.

1

Hosting, SaaS,

and various Cloud

alternatives will

continue to develop.

2

Value Proposition

to replace legacy

systems must be

clear and

compelling.

3

FI’s must become

price-makers, not

price-takers.

4

Processors are in

a race to the bottom

in fees they can

charge.

6

Online and brick-

and-mortar

experience is

blurring and

retailers must

respond.

Rapid growth in

emerging markets

will change the

Global Payments

landscape.

7

8

Regulation is a

pervasive, strategic

driver of payments

and an opportunity

for ACI to lead the

market.

Corporate

Marketing

13

5

Strategic Imperatives

Online, real-time

transcends all

other trends.

1

Hosting, SaaS,

and various Cloud

alternatives will

continue to develop.

2

Value Proposition

to replace legacy

systems must be

clear and

compelling.

3

FI’s must become

price-makers, not

price-takers.

4

Processors are in

a race to the bottom

in fees they can

charge.

5

6

Online and brick-

and-mortar

experience is

blurring and

retailers must

respond.

Rapid growth in

emerging markets

will change the

Global Payments

landscape.

7

Regulation is a

pervasive, strategic

driver of payments

and an opportunity

for ACI to lead the

market.

8

Corporate

Marketing

14

5

The UP Advantage –

BEFORE

FI CORE SYSTEMS & REFERENCE ARCHITECTURE

Wholesale

Retail

…

Networks

Channels

•

Massive customization needs

•

High cost of maintenance

•

Slow time-to-market

•

Difficulty achieving differentiation

Today’s financial

institutions are

burdened with

integration tasks:

Corporate

Marketing

15

The UP Advantage –

BEFORE

FI CORE SYSTEMS & REFERENCE ARCHITECTURE

Wholesale

Retail

…

Networks

Channels

•

Complex systems

•

Little control

•

Little choice

•

Inflexible

Integration:

16

The UP Advantage –

AFTER

UNIVERSAL PAYMENTS

FI CORE SYSTEMS & REFERENCE ARCHITECTURE

Wholesale

Retail

…

Networks

Channels

•

Lower unit costs

•

Speed time-to-market

•

Increase global readiness

•

Enable data mining and

cross-sell opportunities

•

Controlled migration

Universal Payments

aligns with existing

and target

infrastructure to:

17

The UP Advantage –

AFTER

FI CORE SYSTEMS & REFERENCE ARCHITECTURE

Wholesale

Retail

…

Networks

Channels

WHY

•

Control

•

Choice

•

Flexibility

•

Peace of mind

HOW

WHAT

18

UNIVERSAL PAYMENTS

The UP Advantage –

REACTIONS

ACI positioned to

lead the enterprise

payments space…

Best in class

payments

engine…

We see the future

with UP…

We develop and

integrate services

quickly (with UP)

while saving

costs…

Peter Elliot, Head of

Solutions Design, Vocalink

Vincent Querrette, BNPP

CEB TowerGroup

Adrian Hauser,

PayX International

19

Corporate Marketing

The UP Brand: Go to Market Plan

WHY

Control, Choice,

Flexibility &

Peace-of-mind

HOW

Universal Payments

WHAT

Strategic Products

(BASE24-eps, PRM, MTS, Mobility,

Universal Online

Banking, etc.)

20

Corporate Marketing

The UP Brand: Go to Market Plan

21

The UP Brand: Go to Market Plan

22

No one unleashes

the promise and power

of payment systems

like ACI.

NO ONE.

Corporate Marketing

24

Application Development

Tony Scotto

EVP, Application Development

November 14, 2013

25

•

Responsible for timely delivery of product and

customer development projects

•

Average of 346 projects per month

(132 product, 214 customer)

•

1,650 application development professionals

•

Team members in 19 countries

•

11 primary development locations

•

More than 18% of revenue applied to R&D

OVERVIEW

INVESTMENT

SCALE

ACI Application Development Overview

26

Application Development

FI CORE SYSTEMS & REFERENCE ARCHITECTURE

Wholesale

Retail

…

Networks

Channels

UP Overview

•

Lower unit costs

•

Speed time-to-market

•

Increase global readiness

•

Enable data mining and cross-sell

opportunities

•

Reduce maintenance costs

ACI Universal Payments

aligns with existing and

target infrastructure to:

27

UNIVERSAL PAYMENTS

Application Development

UP Technical Differentiators

Support for all

payment types

Service-oriented

architecture

Flexible

service

orchestration

Common

payment object

(Payment Information Model)

28

Customer Benefits of Control, Choice and Flexibility

•

Utilize and leverage existing investments:

renovation does not equal replacement

•

Get

to

market

more

quickly:

up

to

50%

faster

•

Reduce operations and maintenance costs:

up to 40% savings

•

Future-proof

investment:

embrace

continued

industry

disruption

29

UP Use Case

PERSON-TO-PERSON (P2P) AND MOBILE PAYMENTS

CHALLENGE

RESULTS

“[ACI] has increased our agility as a

company and improved our ability to

respond effectively to changing market

conditions and increasing customer

demands like mobile payments.”

–

Rafick Cassim, business manager,

self service at Absa

•

Extend existing payment systems to

generate:

–

New revenue opportunities for

developed markets

–

New ways to deliver payments

to underserved and unbanked

markets

•

UP-enabled cardless authorization

using a user ID, mobile phone number,

customer ID or email address

•

ABSA Bank mobile P2P solution –

120,000 transactions per month,

growing

at

10-15%

monthly

UP Use Case

WHOLESALE BANKING EXAMPLES

CHALLENGES

“After a rigorous evaluation process,

we found that ACI uniquely provides a

robust, scalable and flexible payments

infrastructure to manage all of our

payments needs.”

-leading Middle Eastern Bank

RESULTS

•

Capitalize on new revenue

opportunities

•

Renovation vs. replacement of

legacy systems

•

35% faster user interface

development

•

42% faster development of new

connection types

•

Middle Eastern Bank capitalizes on

new

revenue

opportunity

for

unbanked workers

UP Use Case

UK FASTER PAYMENTS

RESULTS

•

Reduces settlement to 30 minutes

•

UP orchestration enables any-to-any

payments

•

Clear and immediate financial

visibility

CHALLENGE

Real-time Payments Solution

•

Replace traditional 3-day

settlement process with real-

time settlement

•

UP deployed within ACI products

•

Customers achieving significant

benefits

•

Talent, scale and investment to

drive continued innovation

Summary

UP VISION REALIZED TODAY

33

34

BREAK

Global Markets

Dan Frate

EVP, Global Markets and Products

November 14, 2013

35

Developing Long-Term Value

Winning business develops

growing backlog

Managing

maintenance for

profitability

Recurring revenue

through hosting

operations

36

Opportunity for ACI

North America

Europe

Asia Pacific

Latin America

Middle East

& Africa

TRENDS IN NONCASH TRANSACTION VOLUMES

NONCASH TRANSACTION VOLUMES (IN MILLIONS) BY REGION, 2005-2016 (E)

Source: CEB TowerGroup Payment Database (TGPD), 2011

37

Opportunity for ACI

SOLUTIONS PER ACI CUSTOMER

# of Existing Customers in the

Top Banks and Retailers

Average ACI

Customer

2.5

Products

5+ Products

Goal:

38

ACI Worldwide: A Global Payments Company

Canada

1 locations

USA

14 locations

Latin America

2 locations

Brazil

1 location

Africa

2 locations

Continental

Europe

3 locations

Northern

Europe

3 locations

Australia &

New Zealand

2 locations

North Asia

2 locations

ASEAN

2 locations

South Asia

2 locations

Middle East

3 locations

4,500 employees in 35 countries

R+D ~18%

39

CONSUMER/BUSINESS

ACI Universal Payments

SOLUTIONS ACROSS THE PAYMENTS VALUE CHAIN

DEBIT

CREDIT

WIRE

SWIFT

FRAUD

AML

BILL PAYMENT

POS

ACQUIRING

PAYMENT TYPES

PAPER BILLS/

CHECKS

MOBILE

ONLINE

BRANCH

POS

ATM

CHANNELS

40

Global Payment Trends Driving Customer Needs

41

An omni-channel platform

for handling all the engagement points with

consumers –

from branch to online to mobile.

Payment Channel Solutions

A complete business and

wholesale banking solution

Mobile, Online, Trade, and Payments

Win new clients

in fast-paced Asian

business market

Kaisikornbank

Driving profit through

customer centricity

Significant cost savings

to compete with major

US banks

42

Enabling consumer payments

securely from cards to mobile

Payment Engine Solutions

A complete business and

wholesale banking solution

Mobile, Online, Trade, and Payments

Driving fraud rates below

5 basis points

Turning tough regulations

into competitive advantage

Enabling innovation to win

new customers in India

Security and control over

multi-channel retail payments

Bringing the POS to the

consumer to maximize

satisfaction

Managing payments across

12 retail store brands

Retailer Solutions

LEADING CONSUMER

ELECTRONICS PROVIDER

44

Complete biller solutions

from mobile to online to physical to

drive up electronic payments

Biller Solutions

45

ACI Universal Payments

UP AHEAD OF THE INDUSTRY

46

•

Significant growth opportunity

•

Unparalleled global distribution

•

Leading integrated payments solutions

ACI On Demand

David Morem

EVP, ACI On Demand

November 14, 2013

47

AOD provides Software-as-a-Service (SaaS) hosted

payment systems featuring the ACI UP product portfolio

•

4119

financial institutions, retailers and billers

•

7 of the top 50 banks globally

•

3 of the top 10 brands globally

•

1 of the top 3

quick service restaurants in the world

•

5 of the top 10 banks in the U.S.

•

Large financial institutions and retailers

•

Community banks and credit unions

•

Billers

ACI On Demand (AOD) Overview

OVERVIEW

INVESTMENT

SCALE

48

•

Lower up-front investment,

more consistent costs

•

Faster time to market

•

Reduced operational and

regulatory burden

AOD Advantages Over On-Premise Operations

•

Operational excellence

•

Protection from code issues

•

Faster time to service restoration

•

Security and risk management

Retail Payment Solution

for one of the world’s largest fast food

retailers (14,200 stores, 60,000 tills)

RESULTS

•

2

billion

transactions

in

last

year

•

Transaction processing up 31%

over last 2 years

•

Mobile handheld processing

for in-store queue busting

Retail Payments Use Case

LARGE FAST FOOD RETAILER

CHALLENGE

•

Build electronic payments

infrastructure for a historically

cash-based business

•

Scale to address growing

transaction volume, and increase

in number of stores

50

ACI On Demand

Growth

Growth from 10% to 40% of ACI revenues

2011

2013

POST OPAY

2013

2012

APPLICATIONS SUPPORTED

5

10

18

19

2011

2013

POST OPAY

2013

2012

STAFF

120

260

500

575

2011

2013

POST OPAY

2013

2012

REVENUE

$45M

$110M

$260M

$400M

2011

2013

POST OPAY

2013

2012

CUSTOMERS

40

450

1100

4400

51

EBPP:

Grow

market

share

and

vertical reach in Electronic Bill

Presentment and Payment market

SOLUTIONS:

Grow

revenue

and

reach with targeted, high-value

solutions

Major Growth Opportunities

52

•

Displacing in-house solutions

is largest source of ACI

growth in biller-direct

•

80% of transactions are

processed by billers in-house

today

•

3.7 billion payments per year

are processed in-house

•

Compliance, efficiency and

speed to market are driving

growth in outsourcing

ACI Biller Market Opportunity

BILLER DIRECT IS FASTEST-GROWING

SEGMENT OF BILL PAY MARKET

Mail

Walk-in

Auto-debit

Consolidator

Biller-direct

Website

53

8%

6%

4%

-2%

-4%

2%

Source: Aite Group

0%

Acquisition of Online

Resources

EBPP Growth Highlights

25%

20%

15%

10%

5%

0%

2009

2010

2011

2012

ONLINE RESOURCES GREW

TRANSACTIONS AT MORE THAN DOUBLE

INDUSTRY RATE

Biller Direct Industry

Online Resources

Biller Direct

54

Source: Aite Group, 2013

•

Industry’s fastest growing

biller direct provider

•

600+ customers

•

$60 billion in payments

annually

OFFICAL PAYMENTS LEADS INDUSTRY

IN NUMBER OF CUSTOMERS

Acquisition of Official Payments

–

US Internal Revenue Service

–

23 state governments, Puerto Rico and

the District of Columbia

–

Municipal utilities

–

Higher education institutions

Source: Aite Group, 2013

EBPP Growth Highlights

55

•

$9+ billion in payments annually

•

Money transmitter licenses in all states

where required

•

3,000 customers

Online Resources

Official Payments

Future Opportunities

Vertical Market Opportunities

Federal, State & Local

Municipal Utilities

Higher Education

Real Property Taxes

Consumer Finance

(Mortgage, card, auto,

other loans)

Insurance

Utilities

ARM

(Collection agencies,

debt buyers)

Healthcare

Charities

International

Telecom

(TV, phone, Internet)

56

Integrated Bill Payments

One-time and recurring payments, and

consolidated remittances across Web,

IVR and call center

EBPP Use Case

LARGE U.S. MORTGAGE LENDER

RESULTS

CHALLENGE

57

•

Reduce high costs associated with

paper-based payments

•

Integration of remittance channels

•

73%

of

payments

received

electronically vs. industry average

of 44%

•

Turned

off

21%

of

paper

statements

vs. industry average of 16%

ACI Universal Payments

SOLUTIONS ACROSS THE VALUE CHAIN

DEBIT

CREDIT

WIRE

SWIFT

FRAUD

AML

BILL PAYMENT

POS

ACQUIRING

PAYMENT TYPES

PAPER BILLS/

CHECKS

MOBILE

ONLINE

BRANCH

POS

ATM

CHANNELS

58

Community Bank

Competes with Big Banks

Integrated mobile, online and voice

banking solution 

Solutions Use Case

THE PALMETTO BANK

RESULTS

CHALLENGE

59

•

Ability to compete with big bank

offerings for online and mobile

solutions

•

Difficulty keeping up with security,

redundancy and compliance concerns

•

24x7x365

customer

self-service

capabilities

•

Consumer online banking increased by 15%

•

Business online banking increased by 10%

•

Fully

secure,

compliant

•

High-growth, high margin part of

ACI business

•

Source of recurring revenue

•

Operational excellence

•

EBPP represents key opportunity

for growth and vertical expansion

•

Solutions focus to develop

deeper, bigger relationships

Summary

60

Customer Management

and Maintenance

Carolyn Homberger

SVP, Customer Management

November 14, 2013

61

Our focus

What is Customer Management and Maintenance?

Brand

Relationship

Products & Solutions

62

•

Profitability management

•

Customer satisfaction

•

Customer loyalty and

retention

•

Post-implementation support

•

100% recurring revenue

comprised of standard and

premium customer support

•

Expenses are driven by:

-

Production support

-

Software mandates

-

Customer management

shared services (billing,

invoicing, etc.)

Maintenance and Premium

Customer Support (PCS)

•

Sunset products

•

Revenue model driven by:

-

License fees and

maintenance

-

Services

•

Expenses are driven by product

extension (CSMs)

Extended Support

Services (ESS)

Customer Management and Maintenance

PROFITABILITY MANAGEMENT

P&L Model focused on recurring revenue and margin management

63

Customer Management and Maintenance

CUSTOMER SATISFACTION

Customer satisfaction driven by world-class SLA performance

64

Customer Management and Maintenance

CUSTOMER LOYALTY & RETENTION

Customer loyalty drivers…

•

“Cares about customers”

and

“Ease of doing business”

•

Solutions and innovation

•

Operational excellence

$3,112

2009

2010

2011

2012

9-30-13

LOW SINGLE DIGIT ATTRITION AND IMPROVING

(millions)

60-month backlog

65

Customer Management and Maintenance

$1,517

$1,566

$1,617

$2,416

21% CAGR

66

Customer Management and Maintenance

GROWTH

Organic License Fee &

Maintenance Growth

•

High electronic

transaction growth

rates

•

Add-on sales

Cross-Sell

•

UP & solutions focus

•

2X products / customer

Migration to Strategic

Products

•

Best-in-class

migration tools

Premium Customer

Support

•

Customized support –

annual system reviews,

etc.

•

Learning services

Customer Management and Maintenance

•

Focus on profitability…

high margin, high predictability

•

100% satisfaction

with

every customer interaction

•

An experience that “delights”

driving customer loyalty and

retention

Summary

67

Customer Management and Maintenance

Financials

Scott Behrens

Executive Vice President

Chief Financial Officer

November 14, 2013

68

2009

2010

2011

2012

LTM

9-30-13

ACI Sales, Net of

Term Extensions

(SNET)

ACI Term

Extensions

$425

$525

$556

$766

$813

SNET 19% CAGR

$132

$210

$226

$265

$261

$293

$315

$330

$501

$552

•

Renewal rates across ACI products >96%

•

>95% of our contracts are transaction-based

SALES BOOKINGS

Bookings Growth Leads to Large Backlog

PROVIDES REVENUE AND EARNINGS VISIBILITY

(millions)

$3,112

2009

2010

2011

2012

9-30-13

HISTORICAL 60-MONTH BACKLOG

(millions)

$1,517

$1,566

$1,617

$2,416

21% CAGR

69

Financials

ACI’s Financial Summary

2009 –

LTM 9/30/2013

$814

$73

$88

$113

$191

$223

2009

2010

2011

2012

LTM

9-30-13

NON-GAAP REVENUE

2009

2010

2011

2012

LTM

9-30-13

ADJUSTED EBITDA

18%

21%

24%

28%

27%

Adjusted EBITDA

% Margin

20% CAGR

35% CAGR

+900 bps

(millions)

(millions)

70

•

No customer accounts for >3% of revenue

•

LTM 9/30/13 revenue geographic mix: 70% Americas, 20% EMEA and 10% Asia Pacific

$406

$418

$465

$689

Financials

Ongoing Services, Implementations, Increased Capacity Sales & Other

Recurring Revenue: Hosting, Maintenance & License Fees

(Paid Monthly, Quarterly or Annually)

>70% Recurring Revenue and Growing

STRONG RECURRING REVENUE GROWTH

•

Recurring revenue has increased in dollar amount and as a percent of revenue

•

Virtually all components of revenue are seasonally stronger in the latter half of the year

71

2009

2010

2011

2012

2013

Financials

Transaction growth (both in SaaS revenue

and incremental capacity licenses)

Price increases

Annual CPI increases

60-month backlog (recurring only)

Financials

Economic Value of Existing Customer Base is Growing

72

Low Cap Ex and Strong Cash Flow

$30

$63

$67

$24

$106

2009

2010

2011

2012

LTM

9-30-13

OPERATING FREE CASH FLOW

2009

2010

2011

2012

LTM

9-30-13

$10

$13

$19

$17

$22

CAPITAL EXPENDITURES

3%

3%

4%

2%

3%

Low capital expenditures needed to maintain

existing client base

ACI consistently generates strong free cash flow

•

NOLs starting to contribute and cash taxes

much lower than GAAP

(millions)

(millions)

% of Non-GAAP Revenue

Financials

HISTORICAL USE OF CASH/BORROWINGS

SINCE 2005

CUMULATIVE SHARE REPURCHASES

Average price $29.96/share

•

$108 million remains authorized

•

Current leverage ratio 2.8x

*2012 Includes $30m in IBM warrant purchases

Cumulative Amount Purchased ($millions)

Cumulative Shares (millions)

Efficient Use of Cash

AGGRESSIVE SHARE REPURCHASES

Share Repurchases

Acquisitions (excludes

shares issued)

$355m

$1090m

74

Financials

2013 Pro Forma Non-GAAP Revenue Bridge

2013

Pro Forma

2013

*(millions)

Represents low end of guidance

Stub additions normalize for full year contribution

75

•

Normalized 2013 revenue mix:

•

40% Hosting (SaaS), 24% Maintenance and 36% License & Services

•

75% recurring revenue

$883

$30

$122

$1035

ORCC

Stub

OPAY

Stub

Financials

2013 Pro Forma Adjusted EBITDA Bridge

$12

$5

$291

ORCC

Stub and

incremental

synergies

S1

Synergies

Pro Forma

2013

$257

2013

OPAY

Stub and

synergies

$17

*(millions)

Represents low end of guidance

Stub additions normalize for full year contribution

76

Financials

Summary

FINANCIAL SUMMARY –

FIVE YEAR TARGETS

•

Organic revenue growth –

Mid to upper single digits

•

Adjusted EBITDA margin –

100 bps expansion per year

•

Operating free cash flow –

Track adjusted EBITDA growth

•

Sales net of term extension growth –

High single digits

77

Financials

High Quality Software Model

Drives Superior Performance

•

Leading market position

•

High retention and renewal rates

•

Pricing power and large barriers to entry

•

Significant recurring revenue

•

Scalable model with improving margin

•

Low cash investment required

•

Strong cash flow and balance sheet

•

Value enhancing capital allocation

78

Financials

QUESTIONS AND ANSWERS

Non-GAAP Financial Measures

To

supplement

our

financial

results

presented

on

a

GAAP

basis,

we

use

the

non-GAAP

measure

indicated

in

the

tables,

which

exclude

certain

business

combination

accounting

entries

related

to

the

acquisitions

of

ORCC

and

S1

and

significant

transaction

related

expenses,

as

well

as

other

significant

non-cash

expenses

such

as

depreciation,

amortization

and

share-based

compensation,

that

we

believe

are

helpful

in

understanding

our

past

financial

performance

and

our

future

results.

The

presentation

of

these

non-GAAP

financial

measures

should

be

considered

in

addition

to

our

GAAP

results

and

are

not

intended

to

be

considered

in

isolation

or

as

a

substitute

for

the

financial

information

prepared

and

presented

in

accordance

with

GAAP.

Management

generally

compensates

for

limitations

in

the

use

of

non-GAAP

financial

measures

by

relying

on

comparable

GAAP

financial

measures

and

providing

investors

with

a

reconciliation

of

non-GAAP

financial

measures

only

in

addition

to

and

in

conjunction

with

results

presented

in

accordance

with

GAAP.

We

believe

that

these

non-GAAP

financial

measures

reflect

an

additional

way

of

viewing

aspects

of

our

operations

that,

when

viewed

with

our

GAAP

results,

provide

a

more

complete

understanding

of

factors

and

trends

affecting

our

business.

Certain

non-GAAP

measures

include:

•

Non-GAAP

revenue:

revenue

plus

deferred

revenue

that

would

have

been

recognized

in

the

normal

course

of

business

by

S1,

Online

Resources

and

Official

Payments

if

not

for

GAAP

purchase

accounting

requirements.

Non-GAAP

revenue

should

be

considered

in

addition

to,

rather

than

as

a

substitute

for,

revenue.

•

Non-GAAP

operating

income:

operating

income

(loss)

plus

deferred

revenue

that

would

have

been

recognized

in

the

normal

course

of

business

by

S1,

Online

Resources

and

Official

Payments

if

not

for

GAAP

purchase

accounting

requirements

and

significant

transaction

related

expenses.

Non-GAAP

operating

income

should

be

considered

in

addition

to,

rather

than

as

a

substitute

for,

operating

income.

•

Adjusted

EBITDA:

net

income

(loss)

plus

income

tax

expense,

net

interest

income

(expense),

net

other

income

(expense),

depreciation,

amortization

and

non-cash

compensation,

as

well

as

deferred

revenue

that

would

have

been

recognized

in

the

normal

course

of

business

by

S1,

Online

Resources

and

Official

Payments

if

not

for

GAAP

purchase

accounting

requirements

and

significant

transaction

related

expenses.

Adjusted

EBITDA

should

be

considered

in

addition

to,

rather

than

as

a

substitute

for,

operating

income.

Non-GAAP Financial Measures

80

Non-GAAP Financial Measures

Non-GAAP Revenue (millions)

2009

2010

2011

2012

Q4 2012

9 months

9-30-13

LTM

9-30-13

Revenue

406

$    

418

$    

465

$    

667

$    

224

$    

582

$      

806

$    

Deferred revenue fair value adjustment

-

-

-

22

4

4

8

Non-GAAP revenue

406

$    

418

$    

465

$    

689

$    

228

$    

586

$      

814

$    

Adjusted EBITDA (millions)

2009

2010

2011

2012

Q4 2012

9 months

9-30-13

LTM

9-30-13

Net income (loss)

20

$      

27

$      

46

$      

49

$      

50

$      

13

$        

63

$      

Plus:

Income tax expense (benefit)

13

22

18

16

24

5

29

Net interest expense

2

1

1

10

3

17

20

Net other expense

7

4

1

-

(1)

2

1

Depreciation expense

6

6

8

13

4

14

18

Amortization expense

17

20

21

38

10

36

46

Non-cash compensation expense

8

8

11

15

3

11

14

Adjusted EBIDTA

73

88

106

141

93

98

191

      Deferred revenue fair value adjustment

-

-

-

22

4

5

9

    Employee related actions

-

-

-

11

-

9

9

    Facility closure costs

-

-

-

5

1

1

2

IT exit costs

-

-

-

3

-

-

-

    Other significant transaction related

expenses

-

-

7

9

3

9

12

Adjusted EBIDTA excluding significant

transaction related expenses

73

$      

88

$      

113

$    

191

$    

101

$    

122

$      

223

$    

Non-GAAP Financial Measures

81

Reconciliation of Operating Free Cash Flow

(millions)

2009

2010

2011

2012

Q4 2012

9 months

9-30-13

LTM

9-30-13

Net cash provided (used) by operating

activities

44

$      

81

$      

83

$      

(9)

$       

4

$        

87

$        

91

$      

Net after-tax payments associated with

employee-related actions

3

-

-

6

-

5

5

Net after-tax payments associated with facility

closures

-

-

-

3

2

1

3

Net after-tax payments associated with

significant transaction related expenses

-

-

4

9

-

7

7

Net after-tax payments associated with cash

settlement of S1 options

-

-

-

10

-

-

-

Net after-tax payments associated with IBM IT

Outsourcing Transition

1

1

1

-

-

-

Plus IBM Alliance liability repayment

-

-

-

21

21

-

21

Less capital expenditures

(10)

(13)

(19)

(17)

(3)

(18)

(21)

Less IBM Alliance technical enablement

expenditures

(7)

(6)

(2)

-

-

-

-

Operating Free Cash Flow

30

$      

63

$      

67

$      

24

$      

24

$      

82

$        

106

$    

Non-GAAP Financial Measures

Non-GAAP Financial Measures

82

Non-GAAP Financial Measures

ACI

is

also

presenting

operating

free

cash

flow,

which

is

defined

as

net

cash

provided

by

operating

activities,

plus

net

after-tax

payments

associated

with

employee-related

actions

and

facility

closures,

net

after-tax

payments

associated

with

significant

transaction

related

expenses,

net

after-tax

payments

associated

with

IBM

IT

outsourcing

transition

and

termination,

and

less

capital

expenditures.

Operating

free

cash

flow

is

considered

a

non-GAAP

financial

measure

as

defined

by

SEC

Regulation

G.

We

utilize

this

non-GAAP

financial

measure,

and

believe

it

is

useful

to

investors,

as

an

indicator

of

cash

flow

available

for

debt

repayment

and

other

investing

activities,

such

as

capital

investments

and

acquisitions.

We

utilize

operating

free

cash

flow

as

a

further

indicator

of

operating

performance

and

for

planning

investing

activities.

Operating

free

cash

flow

should

be

considered

in

addition

to,

rather

than

as

a

substitute

for,

net

cash

provided

by

operating

activities.

A

limitation

of

operating

free

cash

flow

is

that

it

does

not

represent

the

total

increase

or

decrease

in

the

cash

balance

for

the

period.

This

measure

also

does

not

exclude

mandatory

debt

service

obligations

and,

therefore,

does

not

represent

the

residual

cash

flow

available

for

discretionary

expenditures.

We

believe

that

operating

free

cash

flow

is

useful

to

investors

to

provide

disclosures

of

our

operating

results

on

the

same

basis

as

that

used

by

our

management.

Reconciliation of Operating Free Cash Flow

(millions)

2009

2010

2011

2012

Q4 2012

9 months

9-30-13

LTM

9-30-13

Net cash provided (used) by operating

activities

44

$      

81

$      

83

$      

(9)

$       

4

$        

87

$        

91

$      

Net after-tax payments associated with

employee-related actions

3

-

-

6

-

5

5

Net after-tax payments associated with facility

closures

-

-

-

3

2

1

3

Net after-tax payments associated with

significant transaction related expenses

-

-

4

9

-

7

7

Net after-tax payments associated with cash

settlement of S1 options

-

-

-

10

-

-

-

Net after-tax payments associated with IBM IT

Outsourcing Transition

1

1

1

-

-

-

Plus IBM Alliance liability repayment

-

-

-

21

21

-

21

Less capital expenditures

(10)

(13)

(19)

(17)

(3)

(18)

(21)

Less IBM Alliance technical enablement

expenditures

(7)

(6)

(2)

-

-

-

-

Operating Free Cash Flow

30

$      

63

$      

67

$      

24

$      

24

$      

82

$        

106

$    

Non-GAAP Financial Measures

83

ACI

also

includes

backlog

estimates,

which

include

all

software

license

fees,

maintenance

fees

and

services

specified

in

executed

contracts,

as

well

as

revenues

from

assumed

contract

renewals

to

the

extent

that

we

believe

recognition

of

the

related

revenue

will

occur

within

the

corresponding

backlog

period.

We

have

historically

included

assumed

renewals

in

backlog

estimates

based

upon

automatic

renewal

provisions

in

the

executed

contract

and

our

historic

experience

with

customer

renewal

rates.

Backlog

is

considered

a

non-GAAP

financial

measure

as

defined

by

SEC

Regulation

G.

Our

60-month

backlog

estimate

represents

expected

revenues

from

existing

customers

using

the

following

key

assumptions:

•

Maintenance

fees

are

assumed

to

exist

for

the

duration

of

the

license

term

for

those

contracts

in

which

the

committed

maintenance

term

is

less

than

the

committed

license

term.

•

License,

facilities

management,

and

software

hosting

arrangements

are

assumed

to

renew

at

the

end

of

their

committed

term

at

a

rate

consistent

with

our

historical

experiences.

•

Non-recurring

license

arrangements

are

assumed

to

renew

as

recurring

revenue

streams.

•

Foreign

currency

exchange

rates

are

assumed

to

remain

constant

over

the

60-month

backlog

period

for

those

contracts

stated

in

currencies

other

than

the

U.S.

dollar.

•

Our

pricing

policies

and

practices

are

assumed

to

remain

constant

over

the

60-month

backlog

period.

Estimates

of

future

financial

results

are

inherently

unreliable.

Our

backlog

estimates

require

substantial

judgment

and

are

based

on

a

number

of

assumptions

as

described

above.

These

assumptions

may

turn

out

to

be

inaccurate

or

wrong,

including

for

reasons

outside

of

management’s

control.

For

example,

our

customers

may

attempt

to

renegotiate

or

terminate

their

contracts

for

a

number

of

reasons,

including

mergers,

changes

in

their

financial

condition,

or

general

changes

in

economic

conditions

in

the

customer’s

industry

or

geographic

location,

or

we

may

experience

delays

in

the

development

or

delivery

of

products

or

services

specified

in

customer

contracts

which

may

cause

the

actual

renewal

rates

and

amounts

to

differ

from

historical

experiences.

Changes

in

foreign

currency

exchange

rates

may

also

impact

the

amount

of

revenue

actually

recognized

in

future

periods.

Accordingly,

there

can

be

no

assurance

that

contracts

included

in

backlog

estimates

will

actually

generate

the

specified

revenues

or

that

the

actual

revenues

will

be

generated

within

the

corresponding

60-month

period.

Backlog

should

be

considered

in

addition

to,

rather

than

as

a

substitute

for,

reported

revenue

and

deferred

revenue.

Non-GAAP Financial Measures

Non-GAAP Financial Measures

84

This

presentation

contains

forward-looking

statements

based

on

current

expectations

that

involve

a

number

of

risks

and

uncertainties.

Generally,

forward-looking

statements

do

not

relate

strictly

to

historical

or

current

facts

and

may

include

words

or

phrases

such

as

“believes,”

“

will,”

“expects,”

“anticipates,”

“intends,”

and

words

and

phrases

of

similar

impact.

The

forward-looking

statements

are

made

pursuant

to

safe

harbor

provisions

of

the

Private

Securities

Litigation

Reform

Act

of

1995.

Forward-looking

statements

in

this

presentation

include,

but

are

not

limited

to,

statements

regarding:

•

expectations

regarding

the

financial

impact

of

the

Official

Payments

acquisition;

•

expectations

regarding

future

increases

in

organic

revenue,

adjusted

EBITDA,

operating

free

cash

flow

and

sales

net

of

term

extension;

•

expectations

that

we

will

generate

annual

cost

synergies

with

respect

to

recent

prior

acquisitions;

and

•

expectations

regarding

2013

financial

guidance

related

to

revenue,

operating

income

and

adjusted

EBITDA.

Forward-Looking Statements

Forward-Looking Statements

85

All

of

the

foregoing

forward-looking

statements

are

expressly

qualified

by

the

risk

factors

discussed

in

our

filings

with

the

Securities

and

Exchange

Commission.

Such

factors

include

but

are

not

limited

to,

increased

competition,

the

performance

of

our

strategic

product,

BASE24-

eps,

demand

for

our

products,

restrictions

and

other

financial

covenants

in

our

credit

facility,

consolidations

and

failures

in

the

financial

services

industry,

customer

reluctance

to

switch

to

a

new

vendor,

the

accuracy

of

management’s

backlog

estimates,

the

maturity

of

certain

products,

our

strategy

to

migrate

customers

to

our

next

generation

products,

ratable

or

deferred

recognition

of

certain

revenue

associated

with

customer

migrations

and

the

maturity

of

certain

of

our

products,

failure

to

obtain

renewals

of

customer

contracts

or

to

obtain

such

renewals

on

favorable

terms,

delay

or

cancellation

of

customer

projects

or

inaccurate

project

completion

estimates,

volatility

and

disruption

of

the

capital

and

credit

markets

and

adverse

changes

in

the

global

economy,

our

existing

levels

of

debt,

impairment

of

our

goodwill

or

intangible

assets,

litigation,

future

acquisitions,

strategic

partnerships

and

investments,

risks

related

to

the

expected

benefits

to

be

achieved

in

the

transaction

with

Online

Resources,

the

complexity

of

our

products

and

services

and

the

risk

that

they

may

contain

hidden

defects

or

be

subjected

to

security

breaches

or

viruses,

compliance

of

our

products

with

applicable

legislation,

governmental

regulations

and

industry

standards,

our

compliance

with

privacy

regulations,

the

protection

of

our

intellectual

property

in

intellectual

property

litigation,

the

cyclical

nature

of

our

revenue

and

earnings

and

the

accuracy

of

forecasts

due

to

the

concentration

of

revenue

generating

activity

during

the

final

weeks

of

each

quarter,

business

interruptions

or

failure

of

our

information

technology

and

communication

systems,

our

offshore

software

development

activities,

risks

from

operating

internationally,

including

fluctuations

in

currency

exchange

rates,

exposure

to

unknown

tax

liabilities,

and

volatility

in

our

stock

price.

For

a

detailed

discussion

of

these

risk

factors,

parties

that

are

relying

on

the

forward-looking

statements

should

review

our

filings

with

the

Securities

and

Exchange

Commission,

including

our

most

recently

filed

Annual

Report

on

Form

10-K,

Registration

Statement

on

Form

S-4,

and

subsequent

reports

on

Forms

10-Q

and

8-K.

Forward-Looking Statements

Forward-Looking Statements

86