Exhibit 99.1
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On January 20, 2016, ACI Worldwide, Inc. (the “Company”) and Fiserv, Inc. (“Fiserv”) entered into a definitive agreement providing for the sale of the Company’s Community Financial Services (“CFS”) related assets and liabilities for $200 million, subject to certain working capital adjustments. On March 3, 2016, the Company closed the previously announced sale.
The following Unaudited Pro Forma Condensed Consolidated Financial Statements have been derived by the application of adjustments to the Company’s historical consolidated financial statements. The Unaudited Pro Forma Condensed Consolidated Statement of Income for the fiscal year ended December 31, 2015 is presented as if the disposition had occurred as of January 1, 2015. The Unaudited Pro Forma Condensed Consolidated Balance Sheet as of December 31, 2015 is presented as if the disposition had occurred on December 31, 2015.
The Unaudited Pro Forma Condensed Consolidated Financial Statements are being provided for informational purposes only and are not necessarily indicative of the results of operations or financial position that would have resulted if the disposition had actually occurred on the dates indicated and are not intended to project the Company’s results of operations or financial position for any future period. The unaudited adjustments are based on estimates, available information, and certain assumptions that the Company believes are reasonable, as described in the accompanying notes. The Unaudited Pro Forma Condensed Consolidated Financial Statements and the accompanying notes should be read in conjunction with the historical consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 filed with the Securities and Exchange Commission on February 26, 2016.
ACI WORLDWIDE, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLDATED STATEMENT OF INCOME
| As | Pro Forma | |||||||||||||
| Reported | Adjustments (a) | Pro Forma | ||||||||||||
Revenues | $ | 1,045,977 | $ | (95,105 | ) | $ | 950,872 | |||||||
Operating expenses | ||||||||||||||
Cost of license, maintenance, services and hosting | 472,299 | (61,878 | ) | 410,421 | ||||||||||
Research and development | 145,924 | (7,410 | ) | 138,514 | ||||||||||
Selling and marketing | 129,407 | (8,864 | ) | 120,543 | ||||||||||
General and administrative | 87,419 | (5,958 | ) | 81,461 | ||||||||||
Depreciation and amortization | 82,980 | (4,204 | ) | 78,776 | ||||||||||
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Total operating expenses | 918,029 | (88,314 | ) | 829,715 | ||||||||||
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Operating income | 127,948 | (6,791 | ) | 121,157 | ||||||||||
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Other income (expense) | ||||||||||||||
Interest expense | (41,372 | ) | 612 | (b) | (40,760 | ) | ||||||||
Interest income | 386 | — | 386 | |||||||||||
Other, net | 26,411 | — | 26,411 | |||||||||||
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Total other income (expense) | (14,575 | ) | 612 | (13,963 | ) | |||||||||
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Income before income taxes | 113,373 | (6,179 | ) | 107,194 | ||||||||||
Income tax expense | 27,937 | (2,373 | ) | 25,564 | ||||||||||
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Net income | $ | 85,436 | $ | (3,806 | ) | $ | 81,630 | |||||||
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Earnings per common share | ||||||||||||||
Basic | $ | 0.73 | $ | 0.69 | ||||||||||
Diluted | $ | 0.72 | $ | 0.69 | ||||||||||
Weighted average common shares outstanding | ||||||||||||||
Basic | 117,465 | 117,465 | ||||||||||||
Diluted | 118,919 | 118,919 | ||||||||||||
ACI WORLDWIDE, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
| As | Pro Forma | |||||||||||||
| Reported | Adjustments | Pro Forma | ||||||||||||
ASSETS | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | $ | 102,239 | $ | 199,724 | (c) | $ | 301,963 | |||||||
Receivables, net of allowance for doubtful accounts | 219,116 | (11,925 | ) | (d) | 207,191 | |||||||||
Other current assets | 66,729 | (2,436 | ) | (d) | 64,293 | |||||||||
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Total current assets | 388,084 | 185,363 | 573,447 | |||||||||||
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Noncurrent assets | ||||||||||||||
Property and equipment, net | 60,630 | (1,002 | ) | (d) | 59,628 | |||||||||
Software, net | 237,941 | (19,846 | ) | (d) | 218,095 | |||||||||
Goodwill | 913,261 | — | 913,261 | |||||||||||
Intangible assets, net | 256,925 | (24,577 | ) | (d) | 232,348 | |||||||||
Deferred income taxes, net | 90,872 | (56,959 | ) | (d),(e) | 33,913 | |||||||||
Other noncurrent assets | 42,499 | (2,899 | ) | (d) | 39,600 | |||||||||
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TOTAL ASSETS | $ | 1,990,212 | $ | 80,080 | $ | 2,070,292 | ||||||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||
Current liabilities | ||||||||||||||
Accounts payable | $ | 55,420 | $ | (1,649 | ) | (d) | $ | 53,771 | ||||||
Employee compensation | 31,213 | (1,079 | ) | (d) | 30,134 | |||||||||
Current portion of long-term debt | 95,293 | — | 95,293 | |||||||||||
Deferred revenue | 128,559 | (6,513 | ) | (d) | 122,046 | |||||||||
Other current liabilities | 79,959 | 10,547 | (d),(e) | 90,506 | ||||||||||
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Total current liabilities | 390,444 | 1,306 | 391,750 | |||||||||||
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Noncurrent liabilities | ||||||||||||||
Deferred revenue | 42,081 | (7,645 | ) | (d) | 34,436 | |||||||||
Long-term debt | 843,290 | — | 843,290 | |||||||||||
Deferred income taxes, net | 28,067 | — | 28,067 | |||||||||||
Other noncurrent liabilities | 31,930 | — | 31,930 | |||||||||||
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Total liabilities | 1,335,812 | (6,339 | ) | 1,329,473 | ||||||||||
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Stockholders’ equity | ||||||||||||||
Preferred stock | — | — | — | |||||||||||
Common stock | 702 | — | 702 | |||||||||||
Additional paid-in capital | 561,379 | — | 561,379 | |||||||||||
Retained earnings | 416,851 | 86,419 | (f) | 503,270 | ||||||||||
Treasury stock, at cost | (252,956 | ) | — | (252,956 | ) | |||||||||
Accumulated other comprehensive loss | (71,576 | ) | — | (71,576 | ) | |||||||||
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Total stockholders’ equity | 654,400 | 86,419 | 740,819 | |||||||||||
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,990,212 | $ | 80,080 | $ | 2,070,292 | ||||||||
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ACI WORLDWIDE, INC.
NOTES TO THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The unaudited pro forma condensed consolidated financial statements give effect to the sale of the CFS related assets and liabilities. The unaudited pro forma condensed consolidated statement of income for the year ended December 31, 2015 is presented as if the sale occurred as of January 1, 2015. The unaudited pro forma condensed consolidated balance sheet as of December 31, 2015 is presented as if the sale occurred on that date.
a. The Pro Forma Adjustments columns in these financial statements represent the estimated historical financial results of the CFS products including allocation of applicable overhead costs.
b. The pro forma adjustment represents estimated interest expense that would not have been incurred if the Company had the proceeds from the CFS sale at the beginning of the period.
c. The pro forma adjustment represents estimated proceeds received from the sale of the CFS assets and liabilities, net of third-party transaction costs associated with the sale. The Company expects to use the proceeds to pay down the revolving credit facility and for general corporate purposes.
d. The pro forma adjustments represent the elimination of the assets and liabilities of CFS.
e. The pro forma adjustments include the estimated tax gain on the sale of the CFS related assets and liabilities.
f. The pro forma adjustment represents the estimated after-tax gain of approximately $86.7 million based upon CFS related asset and liability balances at December 31, 2015, net of third-party transaction costs associated with the sale. The actual after-tax gain will be calculated based upon balances on March 3, 2016 and will be subject to post-closing adjustments to be finalized pursuant to the definitive transaction agreement.
The Unaudited Pro Forma Condensed Consolidated Statement of Income does not include adjustments for income from transition services, which the Company expects to recover in the future for costs incurred to provide transition services to Fiserv.