The company faces credit risk from extending credit to clients. Interest rate risk exists on outstanding debt, with a 1% increase in borrowing rates potentially increasing annual interest expense by $1,400. Uncertain tax positions, subject to examination by taxing authorities, could reduce unrecognized tax benefits by $3,000-$7,000 within a year. The company's legal proceedings and claims, while routine, could result in material liabilities.
Financial Upside
Revenue growth is anticipated, primarily from data processing and hosting, card revenue, and digital services. Increased processing volumes and new client acquisition are expected to drive this growth. The company's strong balance sheet and access to credit facilities position it well to capitalize on opportunities. Sublease income from its facilities is also a potential revenue stream.
