ANNUAL REPORT 2015 FISCAL 2015 A GOOD YEAR FOR AMDOCS RECORD YEAR OF REVENUE OUTSIDE OF OUR ESTABLISHED MARKETS WE MAINTAINED OUR STRONG WIN RATE AND FURTHER ENHANCED OUR MARKET-LEADING PORTFOLIO 2015 ANNUAL REPORT 1 LETTER TO SHAREHOLDERS Dear Fellow Shareholders, Fiscal 2015 was a good year for Amdocs, with continued progress across the company. We maintained our strong customer win rate, securing significant transformational projects across the globe, further enhanced our market- leading solutions with new releases of the Amdocs CES portfolio as well as several other key offerings, and acquired a substantial majority of the business support systems (BSS) assets of long-time competitor Comverse, thereby enlarging our customer base. The year was not without its challenges, particularly in terms of the effects of volatile foreign currency fluctuations and the persistent uncertainty resulting from U.S. customer consolidation activity which impacted activity at some of our largest customers. Nevertheless, we exited fiscal 2015 with diluted non-GAAP earnings per share growth that was consistent with the high end of our expectations at the beginning of the year. ELI GELMAN ROBERT A. MINICUCCI President and CEO, Chairman of the Board, Amdocs Management Limited Amdocs Limited Director, Amdocs Limited 2 WWW.AMDOCS.COM WE EXTENDED OUR MANAGED SERVICES RELATIONSHIP WITH BELL CANADA 2015 ANNUAL REPORT 3 NEW OPPORTUNITIES AND INCREASED ACTIVITIES AT OUR MAJOR CUSTOMERS ENLARGED OUR CUSTOMER BASE WITH ACQUISITION OF SUBSTANTIAL MAJORITY OF COMVERSE BSS ASSETS 4 WWW.AMDOCS.COM Solid performance in Record growth in Rest of World North America, Europe Our long-term strategy to penetrate new customers The increased consolidation activity among wireless and geographies resulted in a record year for revenue and Pay TV providers in North America, combined with outside of our established markets of North America delays in regulatory reviews, has created uncertainty in and Europe, primarily due to our progress in the communications market over the past 12 months. At implementing complex modernization projects in both the same time, we have continued to support our major Latin America and Asia-Pacific. We also announced this customers in their ongoing operations and increase our year major BSS transformation projects at either end activities with them. We extended our current managed of the globe: at Singtel for its key markets of Singapore services and related professional services relationship and Australia, while Telefónica selected Amdocs for with Bell Canada through 2022, signed a new five-year its quad-play transformation at Vivo in Brazil. We also agreement at U.S. Cellular to manage the operations of won new customers in other markets, including Kcell, a range of its business and operational support systems Kazakhstan’s largest mobile operator, KT Corporation (BSS/OSS), and assumed responsibility for Rogers’ BSS in South Korea and Indonesian direct-to-home Pay TV systems, across all lines of business, under a three-year provider, Transvision. agreement. Looking ahead over the longer term, we believe our expertise in post-merger integration planning Successful acquisition of Comverse and execution positions us to benefit from the trend BSS assets provides new opportunities of service provider consolidation. We also believe that Over our more than 30-year history, we have used intensified competition in the North American market will M&A as a tool for expansion into new areas, and to present us with additional opportunities to partner with our bring new technologies into the company. With our key customers as they execute their competitive initiatives. acquisition of a substantial majority of Comverse’s BSS assets, we have expanded and diversified our global In Europe, performance was negatively affected by customer base, particularly in Asia-Pacific, Latin foreign currency movements in addition to macro- America and Europe, where Comverse had a wide economic challenges and regulatory pressures which BSS customer footprint. Importantly, a majority of persist in the region. Nevertheless, over the past year, the Comverse customer base that we have acquired we have strengthened long-term relationships with represents new relationships for Amdocs and, some of Europe’s largest service providers extending therefore, new opportunities to support many former and expanding managed services agreements at Mtel, Comverse BSS customers with a much broader range Bulgaria’s largest mobile service provider and one of the of offerings and services. largest affiliates in the Telekom Austria Group, and at EE, the UK’s largest mobile operator. In addition, Vodafone UK selected Amdocs for a four-year managed BSS/OSS transformation project in support of its enterprise business, while in Russia we successfully deployed a customer management solution at VimpelCom’s Beeline brand. 2015 ANNUAL REPORT 5 NEW OFFERINGS MOBILE FINANCIAL SERVICES, BIG DATA ANALYTICS Expanding into new buying centers As a result, service providers embarking on their digital transformation journey are better able to Our strategy to expand into new buying centers of proactively address the demands of what we’re existing customers is also progressing as we extend terming The New World of Customer Experience™, our value proposition into the network. At the beginning and inspire customers with exciting services, create of the year we launched our Network Cloud Service intelligent interactions and deliver a dynamic quality Orchestrator, which enables service providers to define of experience, all the while accelerating the creation and activate complex services containing virtual network of business value. functions (VNFs) in a matter of days instead of months, while our radio access network (RAN) optimization and Allocation of free cash flow to enhance Self-Optimizing Networks solutions help operators such shareholder returns as Vodafone Hutchison Australia improve their network coverage and customer experience across their Free cash flow generation of $658 million in fiscal networks. Meanwhile, our entry into the mobile financial 2015 represented a new company record for the services domain has already seen success with our second successive year and comfortably supported solution being selected by the State Bank of India (SBI) our $268 million acquisition of a substantial majority to offer mobile financial services to India’s unbanked of Comverse’s BSS assets. Demonstrating our and under-banked population, using the mobile network commitment to further enhance the total return we of Bharat Sanchar Nigam Limited (BSNL). provide to our shareholders, we proactively returned about $0.6 billion, or 84% of our free cash flow, We have also continued to strengthen our big data by way of our share repurchase program and our analytics offering, providing new communications- quarterly dividend program. Our Board has also specific applications that allow operators to aggregate approved a nearly 15% increase in our quarterly cash data from multiple marketing, network and customer dividend rate to 19.5 cents per share, commencing in care sources, and generate business and customer April 2016, subject to shareholder approval. This insights with actionable recommendations. Our marks the third consecutive year in which we have data management services have been selected by increased the dividend, and demonstrates our Telefónica for an operational data store solution at its confidence in the future success of Amdocs. operations in Argentina, Chile and Peru. In addition, our continued new releases of the Amdocs CES 9 portfolio have introduced new solutions for online commerce and interactive bills, as well as cross-portfolio enhancements to improve system performance. 6 WWW.AMDOCS.COM BOARD APPROVES DIVIDEND INCREASE FOR THIRD CONSECUTIVE YEAR 2015 ANNUAL REPORT 7 FUTURE GROWTH BUILT ON SOLID FOUNDATIONS OFFERING EVEN BETTER VALUE TO OUR CUSTOMERS AND SHAREHOLDERS 8 WWW.AMDOCS.COM Looking forward with confidence Over the past fiscal year we have grown both organically and through acquisition, and our strategy for future growth is built on solid foundations, supported by our ability to execute the industry’s most complex projects and managed services. As we move forward, we believe the strength of our company and business model will enable Amdocs to offer even better value and benefits to our customers and shareholders. Thank you for your continuing support, confidence and commitment. ELI GELMAN ROBERT A. MINICUCCI President and CEO, Chairman of the Board, Amdocs Management Limited Amdocs Limited Director, Amdocs Limited 2015 ANNUAL REPORT 9 FINANCIAL HIGHLIGHTS (ALL DATA IN MILLIONS, EXCEPT PER SHARE DATA) 2015 2014 2013 TOTAL REVENUE $ 3,644 $ 3,564 $ 3,346 OPERATING INCOME (1) $ 516 $ 496 $ 482 OPERATING INCOME FROM TOTAL REVENUE 14.2% 13.9% 14.4% NET INCOME (1)(2) $ 446 $ 422 $ 412 FREE CASH FLOW (3) $ 658 $ 601 $ 563 DILUTED EARNINGS PER SHARE (1)(2) $ 2.85 $ 2.62 $ 2.53 CASH BALANCES NET OF SHORT-TERM DEBT (4) $1,134 $1,214 $1,126 REVENUE OPERATING INCOME(1) NET INCOME(1)(2) ($ MILLIONS) ($ MILLIONS) ($ MILLIONS) 4,000 600 20.0% 500 3,500 450 500 15.0% 3,564 3,644 400 446 3,000 3,346 422 400 14.4% 10.0% 350 412 2,500 13.9% 14.2% 300 2,000 300 5.0% 482 496 516 250 1,500 200 0.0% 200 1,000 100 100 500 50 0 0 0 2013 2014 2015 2013 2014 2015 2013 2014 2015 OPERATING INCOME AS A PERCENTAGE OF REVENUE FREE CASH FLOW(3) DILUTED EARNINGS CASH BALANCES NET ($ MILLIONS) PER SHARE(1)(2) OF SHORT-TERM DEBT(4)