Ladies and gentlemen, thank you for standing by and welcome to the FIS Fourth Quarter 2018 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] And as a reminder, this conference is being recorded. I'd now like to turn the conference over to our host, Mr. Pete Gunnlaugsson. Please go ahead, sir.

Thank you, Brad. Good morning, everyone and welcome to FIS's fourth quarter 2018 earnings conference call. Turning to slide 2; Gary Norcross, Chairman, President and Chief Executive Officer will begin today's call with company highlights for the quarter and the year. Woody Woodall, our Chief Financial Officer will continue with the financial results for the quarter and full year concluding with 2019 guidance. This conference call is also being webcasted with today's news release and corresponding presentation available on our website at fisglobal.com. Turning to slide 3. Today's remarks will contain forward-looking statements. These statements are subject to risks and uncertainties as described in the press release and other filings with the SEC. The company undertakes no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise except as required by law. I refer you to the Safe Harbor language on the slide. The materials presented today will also include references to non-GAAP financial measures in order to provide more meaningful comparisons between the periods presented. Reconciliations between the GAAP and non-GAAP results are provided in the attachments to the press release and in the Appendix of the supplemental slide presentation. Turning to slide 4, it is now my pleasure to turn the call over to Gary. Gary?

Thank you, Pete. Good morning and thank you for joining us. Today, I’m very pleased to announce our Q4 and full year earnings results. 2018 was a very good year for FIS, as we consistently and successfully executed on the strategic plan we discussed during our Investor Day last May. While impacted throughout the year by revenue mix, especially in our institutional and wholesale division, we exceeded profitability and earnings expectations and met revenue expectations for the full year. From a strategy delivery viewpoint, we exceeded our plans on datacenter consolidation, solution modernization and sales execution, which gives us strong confidence as we start 2019. This confidence allows us to continue building on our multi-year track record of delivering solid revenue growth, exceptional margin expansion and significant shareholder returns. For the year, total shareholder returns exceeded the S&P 500 by approximately 17%, driven by consolidated margin expansion of 280 basis points, adjusted earnings per share growth of 22.5% and a return of over 1.6 billion to shareholders through share repurchases and dividends. These results underscore the resiliency of our business model and showcase our ability to create both short and long term value for our shareholders, while executing on our modernization and transformation strategies. Over the last 3 years, we have strategically tuned our solution portfolio, resulting in divestitures of over 1 billion in annual revenue. During the same period, the market has rewarding our business performance with a $15 billion increase in our market capitalization, representing almost 80% growth over that period. Our financial services focused solutions portfolio combined with our large and loyal client base have enabled us to grow through dynamic market conditions. We exited 2018 with very strong sales momentum and pipeline. Our full year sales results were the strongest in our company's history and as…

Thanks, Gary. Turning to slide 8, in the fourth quarter, revenue increased 3.2% on an organic basis and EBITDA grew to 864 million, a 5.3% increase compared to the prior year period. Fourth quarter revenue was negatively impacted by approximately 40 million due to divestitures. EBITDA margin expanded 200 basis points to 39.9% and adjusted earnings per share grew 29% to $1.60 per share. For the year, revenue increased 2.8% on an organic basis and EBITDA grew to 3.1 billion, a 5% increase compared to the prior year period. EBITDA margin expanded 280 basis points to 37.2% and adjusted earnings per share grew 22.5% to $5.23 per share. We are pleased with delivering on our full year consolidated guidance. Moving to slide 9, as expected, in the fourth quarter, IFS revenue grew on an organic basis by 2.5%, while EBITDA grew 4.5% with 90 basis points of expansion. Margin expansion was driven by growth in our payments business that has high operating leverage. For the year, IFS revenue increased 3.9% on an organic basis. EBITDA increased 4.7% with margin expansion of 60 basis points to 44.6%. We are very pleased with IFS's full year performance, which was driven by balanced demand across all divisions for the year and continued robust sales. We expect this momentum to carry in to 2019, translating into accelerated revenue growth. Turning to slide 10, banking and wealth grew 1.5% for the quarter. For the full year, this group grew a strong 4.3%, primarily driven by our wealth and retirement solutions. Payments had another robust quarter and grew 5.2%, as our network services continue to see sustained volume growth as well as growth in new solution offerings. For the full year, this business grew 3.3%. Corporate and digital was relatively flat for the quarter. Digital growth…

[Operator Instructions] And we'll go to the line of David Koning.

Yeah. And I guess first of all, just thinking through, when we think of IFS and GFS, are they both -- you expect both to be pretty similar growth through ‘19. And I would assume in Q1, GFS would be lower than IFS, just simply because of some of the license timing stuff. Is that fair?

Yeah. Given our sales success throughout 2018, Dave, we actually see both segments accelerating growth rate going into 2019. But as Woody talked about, Q1 in GFS, given the grow over, will be the low water mark for the full year.

If you look at the color between the two segments Dave, we actually expect IFS to grow roughly 100 basis points and accelerate roughly 100 basis points, so even higher than the 4% we saw this year. When you look at our midpoint being a 4% growth, that would translate into GFS being closer to 3, really driven by this mix shift in the GFS segment.

And I guess just my follow up, free cash flow, I know for much of the year, you talked about kind of 110% or 105% or something like that conversion on cash earnings. It looked like it finished the year, I think, we have 86% of cash earnings under the old method. Maybe, you can talk through that and it seems like guidance is well a little lower than what we had previously thought on cash flow.

Yeah. If you look at cash flow, there are really 2 items that were impacting 2018 for the full year. If you look at the hurricane Irma tax relief that we got last year, in terms of a benefit and had to pay this year plus the increase in sales commission payments, both were roughly $100 million apiece. If you add those two together, we were really close to 100% free cash flow conversion. Going forward, we’ll continue to invest -- we're investing roughly 7.5% of revenue back into data center consolidation and modernization and product, so that might be a little higher than we originally anticipated, but certainly we're pleased with 20% free cash flow conversion as a percentage of revenue.

And our next question will come from the line of David Togut.

I’d like to ask about industry consolidation. Two impacts, first, your thoughts on competitive impact from Fiserv’s announced acquisition of First data and then the second impact obviously is consolidation in the customer base, SunTrust, BB&A and you've said that isn't – they’re not core clients, but how do you think about kind of modeling in the impact of customer consolidation into your guidance, both near and long term.

Well, the first on the competitive front, David, we talked a lot about this. We think that the market's going to continue to need to consolidate, scale is going to be a key contributor to be able to compete and grow and certainly historically FIS has participated in those inorganic activities. We will always look for opportunities that center around our three main verticals, whether it's retail banking, payments or institutional or wholesale, we want to take good care of the capital in the company and our shareholders that entrust into us and certainly as we look for opportunities that can accelerate our growth rate and help us grow our scale, that's going to be important. When you look at industry consolidation across the various financial institutions, we actually modeled going into 2019 a very consistent level of industry consolidation. It's very hard to predict when these announcements are going to occur. It's very hard to predict what the impact could be, both positive and negative, depending on how the institutions come together, but at this point in time, in 2019, for modeling purposes, we model consistent over 2018 from a consolidation standpoint.

And by consistent, you mean you've modeled in a specific headwind to revenue and EPS or?

Yes. Very similar to what we've done in the past between customer losses and compression roughly 150 basis points a year, Dave, just like we have in the past. We don't see any acceleration, if you will, of potential customer losses here. In fact, one of the comments on one of the bank consolidation calls was their need to continue to expand and invest in modernization and technology to compete in the future and we think that could be certainly a benefit for us on a go forward basis.

And as we highlighted throughout the call, David, I mean, you see a number of really large wins for us across 2018 and where large and stations are doing just that modernization investment. So to Woody’s point, that should be a -- that could be a positive tailwind for us.

Understood. Just a quick final question, the 2019 EPS guidance calls for 8% to 11% growth on an adjusted basis. That is somewhat below your 3-year target of 10% to 13% growth. Is that just the math of the new adjusted EPS reporting structure or is it mostly a slow start on I&W?

I think the biggest difference is a tax headwind in 2019 compared to ’18, David. We landed with a lower tax rate in 2018 at 17.5%. We think 2019 is going to be roughly 19%. Actually, if you look at old method, new method, we guided 7.35 to 7.55. If I were guiding old method, I would have guided 5.60 to 5.80 with a midpoint of 5.70 and really the difference between that and current consensus estimates is the early closing of Brazil, which cost us about $0.08 versus our original expectation.

And we’ll go to the next line of Brett Huff.

Can you talk a little bit about the revenue shift that you guys have been mentioning. I think this came up a couple of times, maybe one or two quarters earlier in ‘18. Why is this accelerating so much, is it a function of your kind of pushing your modernization by modularity? Is there some big change that the bigger banks you guys serve or may be the medium sized banks, they’re choosing outsourcing more, what's the acceleration that's driving this long ref rec?

I think Brad, we’re seeing it in the sales cycle. I think larger institutions are looking at their total cost of ownership, they're looking at their legacy technology debt that they have in place, we're running it on premise. Frankly, as they look at our more modern solutions and being able to consume that with the investments that we're delivering in our private cloud surrounded by our robust security measures, so they're seeing higher availability, lower total cost of ownership and as we've discussed, we just – we felt for a long time, the industry is going to start moving in that direction and for years, classic community banks, what we define as community banks were all outsourcing, but now, as you move up market, you see $20 billion institutions, $100 billion institutions now looking for ways to leverage our investment and scale around technology and modernization and that's just playing out in our sales efforts, including the I&W side, as I highlighted in the call, our sales on SaaS model deployments on I&W were up significantly year-over-year and that's just an indicator of the market looking for ways to lower their total cost of ownership and leverage our scale in investment.

And then Woody, I think in your guidance, I believe you said that you expect CapEx to come in at 7.5%, did I hear that right?

That’s 7.5% of revenue for CapEx in 2019, which is a continued acceleration off of 2018, really around this modernization, the innovation work that we have and the data center consolidation, which is driving some of the margin expansion.

As you can see, we're well ahead of where we thought we would be on data center consolidation and the return we're getting on that investment through not only cost saves, but just availability and market recognition has been very beneficial. So, we want to continue to lean in on that program and accelerate that for the remaining couple of years.

Ex the data center, should we expect a higher level, I mean, is this now an industry where we just kind of have to spend a little more to keep ahead of the technology curve, even if we look ex the data centers? I mean usually I think it's been 5% to 6%, should we expect 6 to 7 even ex data centers going forward or how do we think about the reinvestment that you guys need to do?

We talked about that last May in our Investor update. As you think about it, the industry, we've been a leader in this industry for the last 50 years and as we think about where the future is, clearly, there is a tremendous amount of legacy technology that's going to have to be modernized for the future. It’s going to have to be built with cloud deployment from the ground up and so we do see a hump here, where we're going to have to invest at a level, but as we talked about in May, we see that declining back to more normalized levels once we've moved our legacy technology in application to the future and the whole industry will have to go through this process. You're seeing it with every call, as Woody highlighted, when you look at the BB&T SunTrust combination, they highlighted the need to be able to invest in innovation and digital. That's just really a different way of saying needing to move their technology stack from historical positions to the future and so we'll see this run in the sevens as we're doing today. But we'll see the advantages of that and then once we get through this curve over the next couple of years, you'll see it return back to our normalized 5% to 6% as we discussed in May.

And the next question or comment will come from the line of Darrin Peller.

Look, we're getting a lot of questions still on just the outlook, just to make sure that where the confidence is coming from and the acceleration of over 100 basis points on top line. So maybe just give us a little more color on whether or not how much of that is already in what you've already signed in terms of new bookings that -- you had some pretty strong growth in the quarter. And then any more granularity you can give us on the subsegments, what kind of acceleration and for instance, the I&W category, that showed some weakness this quarter, where the payments business continuing to show some strength, anymore color would be great.

Yeah. I mean, I think most of the strength comes in the sales commentary we've been talking about and the buildup of the backlog, that 20.5 billion, a significant chunk of that comes through, as we show in our 10-K disclosures and our 10-Q disclosures each quarter. We anticipated that to grow and it did, along with the sales themselves. If you look at the components of growth by segment in 2019, I think across the three groups, IFS, all of those guys will accelerate over the 2018 growth rates. If you break it down between banking and payments and institutional and wholesale within GFS, let’s call, GFS roughly a 3% growth for full year, you're going to see higher growth than that out of banking and payments, slightly lower growth than that out of institutional and wholesale for the full year again with some headwind in Q1 on GFS. But broadly, that 4% midpoint for the full year.

Yeah. That's right. Darrin, the sales success was very, very strong last year and to Woody’s point, the highly reoccurring nature of our business going into ’19, we don't have any more risk than what we would have in 2018, it's just good strong sales performance and now we've got onboard those sales and get the results of that and then continue to sell through the year.

Gary, just a quick follow up, I mean I know you are as briefly about the deal, M&A environment, but I guess we're just getting a lot of questions, so maybe a little more pointedly, what are your thoughts in terms of your need or not lack thereof to get something now, it’s been a little while obviously. And if so, just remind us the areas that you think about as the core priorities for M&A for FIS in the next year or two?

Look Darrin, as we’ve talked about consistently, inorganic activities will play a role in our strategy. You've seen its focus on pulling our portfolio, I would tell you that work's done. You've seen us focused on strengthening our balance sheet, I would tell you that work's done. You've seen our investment strategies and the results of that with margin expansion, so we feel great about the position the company's in, we feel great about our ability to compete in the industry today, as we currently sit. With that as a backdrop, we would be interested in pursuing something inorganically, if it fits our strategy, we want to find something that will definitely accelerate our growth rate. We also want to find something that fits within our financial services focus. We're interested in, as I think about the company, I think about three broad categories and I think about them on a global basis, so we think about retail banking, we think about payments and we think about institutional and wholesale and there's a number of opportunities within each of those areas that could make sense from a strategy viewpoint, of course, they would have to be actionable and have to make financial sense, but we do believe that the market will continue to consolidate, both on the provider side as well as on the financial institution side and financial services side. So -- and scale is going to continue to drive and be a differentiator, the need to invest to continue to modernize both the technology and application layers and to innovate around those, so that our customers can deal with various disruptors in the industry are going to be important and scale will contribute to that.

And the next question in queue will come from Chris Shutler.

This is actually Andrew Nicholas in for Chris. So we need to talk a little bit about the recent sales activity in the institutional and wholesale segment. I’m mainly curious the recent market volatility impacted the quarter and the pipeline in that business and then also how much of the revenue in I&W is priced based on assets.

Yeah. We did see some impact in some of our trading platforms due to volatility, but I also highlighted last year we had a great year of new logo wins in the I&W business where our products continue to take share from a lot of competition in that space. So we’re excited about some of the results that we've seen in that. Of course, our SaaS sales are way up as well. We got a number of different products, so pricing is never answer just on a simple unit price, but most of our products are tied to, from a pricing viewpoint, tied to some type of unit price and then hosting license fees wrapped around that I&W space.

As we've talked about in the past, the amount of revenue tied to asset size is very, very smell, the amount of revenue tied to trading and volumes is roughly 2.5% of consolidated revenue, so still in the big picture, a relatively small impact from a volatility perspective.

And then second, I was hoping you could walk through the different factors that would drive you to the high versus low end of your margin expansion guidance?

Yeah. I think continued efforts around data center consolidation, which is really one of the primary drivers on the outsized margin expansion versus what we talked about last year, our divestiture activity, which we've completed this year are driving roughly 30 basis points of margin expansion in 2019 and then continued efforts around managing our costs and deploying one to many model type revenues that continue to provide higher incremental margins. Those are the three primary components that help us drive that margin expansion and will help us move towards a higher end there.

And next question will come from the line of Jim Schneider.

I wondered if you can maybe talk a little bit more around the IFS acceleration, specifically which products are the ones that are picking up, maybe talk about which ancillary products as well as if you're seeing any kind of core wins in that acceleration number from 4 to 5 this year?

Yeah. As Woody mentioned and we tried to cover some of that in the prepared remarks, honestly, we’ve seen good growth across all of the sub segments within IFS. So we've highlighted some really nice core banking wins in 2018 on actually an outsourced maces or in the SaaS deployment, we think that trend is going to continue. Our pipeline was good there as we bring new capabilities in market. We've seen some strengthening in our payments business throughout 2018 and going into 2019, we've seen some great results around mass enablement, around that customer base and ability to really innovatively deploy products faster into that market and that's going to expand. So -- and when you look at the digital footprint, we highlighted our new Digital One platform that we brought to market in 2018, saw a lot of opportunity for that in the GFS segment in 2018, which helped us drive some of the banking business there, but that's actually now deploying in our IFS market, so getting good reception on that. So we're really seeing our sales effort hitting on all cylinders, we tend to skew towards the larger side of community banking historically and we've highlighted a number of examples in the script that came through in the quarter.

And maybe as a quick follow up, relative to the BB&T SunTrust environment, I guess a different angle on it, which is, what are your clients saying about their competitive response if any to that merger, kept the next level down from the merged super regionals and can you maybe talk about where they might decide to invest more versus any places you think they might pull back a little bit?

I think it's early to see what the response is. We've got to see how that combination transpires. I would say in general, if you look at the large regionals or really large community institutions, we're seeing in our sales success throughout 2018 really starting to see a strong demand to modernize the platforms. A lot of those institutions have been dealing with the level of technology and application debt for years and they're looking for how do we modernize our platforms and lower total cost of ownership. We’ve highlighted a couple of examples in the script, $100 billion institution moved to a much more robust payments as a service solution, leveraging all of FIS’ capabilities and leveraging our cloud base deployments. We had another $20 billion institution that really is moving from a series of discrete solutions that they were leveraging in-house development resources to bring together and really taking advantage of the full solution suite of FIS. And those are just indicators that while people are looking to merge and grab scale, so they can have investment dollars to accelerate their enervation and change, all of them are still talking about the need to change. So do we think there will be further consolidation as Woody talked about, we don't believe it's going to accelerate over where it was in 2018, but it's very hard to predict.

And we’ll go to the line of Ashwin Shirvaikar.

My question – first question was, you talked already about the cadence of revenues through the years improving as you go from 1Q to 4Q. Can you talk about the cadence of margin improvement, particularly given you're saying that you’re quite far along on the data center consolidation side and solution modernization, so can you kind of talk about how we should think about how the cost side flows through?

Yeah. If you think about it, we’ll continue to see incremental benefits of data center consolidation along the years, so that will help incrementally grow margins from Q1 through to Q4. The divestiture components will go in line with where the timeline is on the divestitures and sales, so you'll see that flowing relatively ratable over the year and then the first quarter will probably be a little lower in terms of margin expansion because of the heavy license component that we talked about this time last year and first quarter of ’18, so that should give you some color on how we think about where the margins will flow, Ashwin.

And then the second question is, broadly speaking, as you talk about year-over-year improvement in demand, it seems to me you've touched on a few points and I just like to confirm, there seems to be higher win rate perhaps, there seems to be broadly maybe more demand for the particular product set you’re now bringing and you’re also with mass enablement onboarding faster, am I understanding correctly that you’re actually checking all these boxes?

Yeah. I think I would add one more. I think the trend towards outsourcing or SaaS deployment leveraging our investment around cloud, so our data center consolidation is really driving two things. One, it is driving cost reductions. We’ve highlighted that, but it's really elevating our technology stack to much more modern architecture and deployment with much higher resiliency. And so all of those things are feeding into people wanting to leverage that investment that FIS has made and so therefore as we've talked in the past, as we move from on premise deployment to SaaS deployment, you're going to see a much higher revenue stream, larger contracts et cetera, but I think those three things are really driving the increase in growth rates that we’ve talked about.

Yeah. If you think back a few years ago, we started increasing our investment in CapEx, that CapEx is not just hard assets for data center consolidation, but it's also around product and innovation and trying to bring those new solutions to market faster. I think all those things collectively are resonating with the client base and it's resonating in the actual sales closure rates.

Yeah. The point you made about mass enablement, we’re very excited about it, obviously generated a relatively small amount in 2018, but that's accelerating dramatically going into ‘19 and really how do you -- one of the things -- a lot of the things our clients are asking for is how do you get product to market faster, how do you remove friction through that process and so we've spent a lot of money on innovating to be able to bring some of those solutions, not one at a time, but how do we deploy a new capability across 100, across 500, across 1000 customers and we think it's going to make a real impact, as we continue to innovate around that and bring more and more capability to market faster.

Understood. Is it safe to say that you guys are maybe in the middle innings, these kind of transitions tend to be multi-year in nature, can take 3 years, 4 years, are you in middle innings is fair?

I think that is fair. We highlighted data center consolidation, we just wrapped up the third year of data center consolidation and we're very pleased at where we are on the run rate cost takeout whereas I highlight in the script, we’re ahead of where we originally thought. So, we still have another 2 to 3 years left globally on that. We've got 2 years in the domestic, so we're going to continue to push through that and we're going to continue to drive a total of more than 250 million of cost saves out of just that one exercise, but it's more important to understand where the end state's going to be at that point in time and at that point in time, when you look at resiliency, when you look at the level of cloud based computing, we're going to have in the industry, when you look at our security posture, we're going to have a great environment for our clients and our prospects to take advantage of it and then when you build the application modernization innovation that we're bringing in the market, we're excited about the future at FIS.

And these investments are starting to translate into accelerating revenue growth from 2% to 3% to 4%, we're feel really good about getting good return on that investment.

And we’ll go to the next question in queue, it comes from George Mihalos.

So just wanted to ask on Brazil now that you're liberated from Bradesco. How have the sales opportunities been, just curious kind of how the commentary is with other potential clients and partners and then the $0.08 of dilution, just want to make sure I understand where that's coming from, is that because of the change in reporting or is there something else that's driving that dilution?

Well, first, we've got a great long term relationship with Bradesco. They just -- we've now got a 5-year commercial agreement with them, so they're still going to be great substantial client going forward, but you're right, George, it really does free up the ability now for us to bring more product, more capability into that market. Historically, the way the JV worked, we were somewhat encumbered because everything had to come through that joint venture and therefore a lot of customers weren't interested in giving the ownership structure. So it does now free us up to move new product and capability in market. Woody was just down there, I know, he met with a lot of the clients in market and a lot of the prospects. I would tell you, our sales team is very excited. We're also already moving some of our capabilities down there. So I think Brazil's going to be a very good market for us going forward.

If you're specifically asking on the $0.08 dilution, it's really around the timing, we’d anticipated this thing to close roughly June 30th of this year versus January 1st. So instead of having that that revenue and EBITDA roll up to the consolidated for six more months, which has got done early.

And just a quick follow up Woody for purposes of calculating EPS for ’19, more in line with how you've done it in the past, can you break out for us what your expectation is for core D&A and then intangible amortization?

Yeah. I think if you think about it, we've got disclosures in there that give you one for one. We haven't given D&A disclosures for full year yet, but you could think about roughly $1.75 of difference between the 735 to 755 versus an old method of 560 to 580.

Our next question comes from Andrew Jeffrey.

You've been talking very consistently for the past year about process improvement, product delivery improvement, which I take to mean time to market and your solutions like SaaS. I just wonder if you think over a multi-year period, how do you quantify the ability to kind of bend your growth curve. I mean ‘19, IFS did a little better, maybe GFS has more trading volume exposure, but on a compound basis, is there a point where some of these investments really start to improve the sustainability of your growth, the cycle notwithstanding.

Yeah. And obviously we think so Andrew and we're seeing that in our sales cycle, we're seeing sales accelerate year-over-year, we're seeing growth rates accelerate year-over-year, we're seeing margins accelerate year-over-year and all of that’s about our consistent strategy around modernization, both technology and the application layer and you're right, I mean, the industry is looking for more flexibility, they're looking for more speed, they're looking for higher availability and you're not going to get that through the historical technology stacks and obviously it's a heavy lift that all providers will need to go through. We're just moving into our fourth year of that and so we do feel good that you'll continue to see our growth rates trend up. And given the reoccurring nature of our revenue, we will continue to be very predictable and will lead the industry with regards to margin as well. So, we're very confident in investments, we've been very consistent on the strategy and we think the long term outcome for the company is going to be a much stronger growth rate, as we deploy this.

Okay. And if you could, maybe opine a little bit on geo mix. I mean a lot of the increased tech spend as you cited in the SunTrust BB&T deal seems to be driven by US imperatives, what about Europe and rest of the world, where do you think we are in terms of demand for more digitized solutions and perhaps what might change the growth parameters outside of the US?

Yeah. We've been fairly consistent. We saw Europe return slower than what -- than some of our other geos. But we had a really good year in Europe with regards to sales demand and we have a good pipeline going into ‘19 on Europe. I mean, one of the things that we're doing and I referenced in the script, not only are we making all this investment in technology, we're getting better leverage across the two segments. So we're building out an omni-channel digital -- next generation digital platform called Digital One, great success with that in the US in 2018 in the GFS market, you're seeing us deploy that very rapidly in the IFS market. You're going to also see us push that into other geos around the world, so we're getting more leverage out of our investment as well across the various segments. We're doing the same thing with regard to our data center consolidation and our technology stack, as we move more of our compute into the cloud, both segments are able to take advantage of that with industry leading availability and cost. So all of these things, we think, will be able to continue to expand in the various geos we’re in. We highlighted some opportunities we have in Brazil, we still see good opportunities in Europe, especially in the UK and certain Western European countries and then in Asia, we continue to have good solid growth in Asia and we think all of that will continue.

And our last question on today’s call this morning will come from Ramsey El-Assal.

I wanted to ask, kind of following up on Ashwin's question a bit, you called out a really strong sales backlog and obviously your solutions are resonating in the marketplace, but is there a IT bank, IT spending sort of overlay here, it really feels like bank’s wallets are sort of opening up in a nice way, can you comment a little bit on the broader environment, irrespective of the strength of your solutions?

Yeah. Ramsey, I do think we're seeing that. I think the recovery has been slow and I think that financial institutions broadly are realizing that they are now having to open up their span and actually start spending money on next generation technologies and we're seeing the results of that in our sales cycle. They really are looking for how to achieve a higher level of availability and risk posture, you're not going to do that unless you really embrace some of these new cloud technologies, they're really looking for what are built digitally native from the ground up, and how do we drive more open API framework, so we can build around the edges and all of those things FIS have been investing in very heavily, whether it's Code Connect, which we launched last year, which we’re seeing great adoption, which is truly a new fully open API framework, whether it's some of our next generation components that we're now bringing to market. We highlighted a large bank that's entering the US with the digital institution that's going to take our cloud native core banking solutions surrounded by Digital One or our omni-channel digital platform. Also, as you go over into the I&W space, we're seeing a lot of demand and highlighted that with our new logo sales. That's indications of our clients now looking to move from their historically in-house developed products or even third-party products that they customized and cobbled together moving to the future. So yeah, I do think that IT spend is opening up in the market and we're seeing in our sales cycle FIS be the beneficiary of that.

I wanted -- a quick follow up here. I wanted to ask about your margin – your inherent operating leverage in the business. I mean the full year margin guidance obviously came above -- came in above your 3 year range and then there's quite a bit of moving parts in terms of divestitures and mix and other factors, but when you strip away some of the non-recurring contributors like data center consolidation, expense efficiency, has your underlying operating leverage kind of improved relative to when you last gave that sort of long term guidance, just due to mix and divestitures and other factors? I mean, could we be looking at margin outperformance kind of in the out years relative to that guide or really what's driving our performance sort of non-recurring factors at this point?

Yeah. I think the quality of the assets at this point is better than it was when we’ve talked about things in May last year. So to your point, I think you could see us driving midpoint or higher on that margin, even in the out years once we get past data center consolidation. So yeah, I think it is an improved cost efficiency and business mix that we have that’s an ongoing benefit.

Thank you for joining us today and for your ongoing interest in FIS. We’re pleased to deliver another year of strong revenue, profitability performance and earnings growth. We have a robust pipeline heading into 2019 with positive sales momentum. Combined with our business model and consistent execution of our strategy, we're confident that we are paving the way for a successful 2019 and beyond. I'd like to thank our loyal clients who depend on and trust us to keep their businesses running and growing every day and I’d like to thank our leaders and employees for their hard work and dedication in serving our clients. It's because of both that FIS continues to empower the financial world. Thank you for joining us today.

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