Global Payments Reports Second Quarter Earnings

Increases Fiscal 2014 EPS Outlook

08 Jan, 2014, 16:00 ET from Global Payments Inc.

ATLANTA, Jan. 8, 2014 /PRNewswire/ -- Global Payments Inc. (NYSE: GPN) today announced results for its fiscal second quarter ended November 30, 2013.  

(Logo: http://photos.prnewswire.com/prnh/20010221/ATW031LOGO )

President and CEO Jeff Sloan said, "We are pleased with our results for the quarter driven by strong business performance across all regions, and we now expect double digit cash earnings per share growth for our full-year.  We are making substantial progress on our growth initiatives globally, and we remain focused on being the partner of choice."

Second Quarter 2014 Summary

  • Revenues grew 8% to $634.1 million, compared to $588.5 million in the second quarter of fiscal 2013.
  • Cash diluted earnings per share grew 15% to $1.07, compared to $0.93 in the second quarter of fiscal 2013.
  • GAAP diluted earnings per share were $1.02, compared to $0.89 in the second quarter of 2013.

2014 Outlook

"We are raising our full-year expectations for diluted earnings per share on a cash basis by five cents to a range of $4.03 to $4.10, or growth of 10% to 12% over fiscal 2013," said David E. Mangum, Senior Executive Vice President and CFO.

Annual fiscal 2014 GAAP diluted earnings per share are now expected to be $3.45 to $3.52

The company maintains its expectations for annual revenue of $2.51 billion to $2.56 billion, or 6% to 8% growth over fiscal 2013. 

Conference Call

Global Payments will hold a conference call today, January 8, 2014 at 5:00 p.m. EST to discuss financial results and business highlights.  Callers may access the conference call via the investor relations page of the company's website at www.globalpaymentsinc.com by clicking the "Webcast" button; or callers in North America may dial 1-888-895-3550 and callers outside North America may dial 1-706-758-8809.  The pass code is "GPN."  A replay of the call may be accessed through the Global Payments website through January 22, 2014.

About Global Payments

Global Payments Inc. (NYSE: GPN) is a leading provider of electronic transaction processing services for merchants, Independent Sales Organizations (ISOs), financial institutions, government agencies and multi-national corporations located throughout North America, South America, Europe and the Asia-Pacific region.  Global Payments, a Fortune 1000 company, offers a comprehensive line of processing solutions for credit and debit cards, business-to-business purchasing cards, gift cards, electronic check conversion and check guarantee, verification and recovery including electronic check services, as well as terminal management.  Visit www.globalpaymentsinc.com for more information about the company and its services.

This announcement and comments made by Global Payments' management during the conference call may contain certain forward-looking statements within the meaning of the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995.  Statements that are not historical facts, including revenue and earnings estimates and management's expectations regarding future events and developments, are forward-looking statements and are subject to significant risks and uncertainties.  Important factors that may cause actual events or results to differ materially from those anticipated by such forward-looking statements include the following: the effect on our results of operations of continued security enhancements to our processing system; foreign currency risks which become increasingly relevant as we expand internationally; the effect of current domestic and worldwide economic conditions, future performance and integration of acquisitions, and other risks detailed in our SEC filings, including the most recently filed Form 10-K.  We undertake no obligation to revise any of these statements to reflect future circumstances or the occurrence of unanticipated events.

 

Investor contact: 

investor.relations@globalpay.com  

Media contact:

media.relations@globalpay.com

Jane Elliott

Amy Corn

770-829-8234

770-829-8755

 

SCHEDULE 1

GAAP CONSOLIDATED STATEMENTS OF INCOME 

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except per share data)

Three Months Ended 

November 30,

Six Months Ended

November 30,

2013

2012

% Change

2013

2012

% Change

(unaudited)

(unaudited)

Revenues

$     634,122

$      588,538

7.7%

$  1,263,807

$   1,178,825

7.2%

Operating expenses:

Cost of service

235,170

210,268

11.8%

465,915

414,659

12.4%

Sales, general and administrative

294,045

276,177

6.5%

585,601

557,596

5.0%

Processing system intrusion

(7,000)

(14,489)

(51.7%)

(7,000)

9,500

(173.7%)

522,215

471,956

10.6%

1,044,516

981,755

6.4%

Operating income

111,907

116,582

(4.0%)

219,291

197,070

11.3%

Other income (expense):

Interest and other income

5,288

2,187

141.8%

8,626

4,170

106.9%

Interest and other expense

(8,025)

(14,609)

(45.1%)

(15,904)

(18,154)

(12.4%)

(2,737)

(12,422)

(78.0%)

(7,278)

(13,984)

(48.0%)

Income before income taxes 

109,170

104,160

4.8%

212,013

183,086

15.8%

Provision for income taxes

(29,313)

(28,789)

1.8%

(60,448)

(53,553)

12.9%

Net income

79,857

75,371

6.0%

151,565

129,533

17.0%

Less: Net income attributable to noncontrolling interests, net of income tax

(5,960)

(5,188)

14.9%

(13,025)

(12,675)

2.8%

Net income attributable to Global Payments

$        73,897

$         70,183

5.3%

$     138,540

$      116,858

18.6%

Earnings per share attributable to Global Payments:

    Basic

$            1.02

$             0.89

14.6%

$            1.90

$             1.49

27.5%

    Diluted

$            1.02

$             0.89

14.6%

$            1.88

$             1.48

27.0%

Weighted average shares outstanding:

    Basic

72,174

78,751

72,974

78,669

    Diluted

72,706

79,144

73,504

79,062

 

SCHEDULE 2

CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except per share data)

Three Months Ended 

November 30,

Six Months Ended 

November 30,

2013

2012

% Change

2013

2012

% Change

Revenues

$       634,122

$     588,538

7.7%

$    1,263,807

$  1,178,825

7.2%

Operating expenses:

Cost of service

220,610

195,932

12.6%

436,383

388,937

12.2%

Sales, general and administrative

290,697

276,177

5.3%

580,757

556,796

4.3%

511,307

472,109

8.3%

1,017,140

945,733

7.6%

Operating income

122,815

116,429

5.5%

246,667

233,092

5.8%

Other income (expense):

Interest and other income

3,165

2,187

44.7%

6,503

4,170

55.9%

Interest and other expense

(8,025)

(6,226)

28.9%

(15,904)

(9,771)

62.8%

(4,860)

(4,039)

20.3%

(9,401)

(5,601)

67.8%

Income before income taxes 

117,955

112,390

5.0%

237,266

227,491

4.3%

Provision for income taxes

(32,873)

(29,385)

11.9%

(69,559)

(65,938)

5.5%

Net income

85,082

83,005

2.5%

167,707

161,553

3.8%

Less: Net income attributable to noncontrolling interests, net of income tax

(7,197)

(9,419)

(23.6%)

(15,633)

(19,171)

(18.5%)

Net income attributable to Global Payments

$         77,885

$       73,586

5.8%

$       152,074

$     142,382

6.8%

Earnings per share attributable to Global Payments:

    Basic

$              1.08

$            0.93

16.1%

$              2.08

$            1.81

14.9%

    Diluted

$              1.07

$            0.93

15.1%

$              2.07

$            1.80

15.0%

Weighted average shares outstanding:

    Basic

72,174

78,751

72,974

78,669

    Diluted

72,706

79,144

73,504

79,062

See Schedules 6 and 7 for a reconciliation of cash earnings to GAAP.

 

SCHEDULE 3

SEGMENT INFORMATION 

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands)

 Three Months Ended November 30, 

2013

2012

 % Change 

 GAAP 

 Cash Earnings 

 GAAP 

 Cash Earnings 

 GAAP 

 Cash Earnings 

Revenues:

United States

$    361,793

$    361,793

$    339,998

$    339,998

6.4%

6.4%

Canada

85,240

85,240

80,770

80,770

5.5%

5.5%

North America merchant services

447,033

447,033

420,768

420,768

6.2%

6.2%

Europe

146,866

146,866

131,161

131,161

12.0%

12.0%

Asia-Pacific

40,223

40,223

36,609

36,609

9.9%

9.9%

International merchant services

187,089

187,089

167,770

167,770

11.5%

11.5%

Total revenues

$    634,122

$    634,122

$    588,538

$    588,538

7.7%

7.7%

Operating income (loss) for segments:

North America merchant services

$      70,437

$      77,621

$      67,114

$      73,280

5.0%

5.9%

International merchant services

62,467

69,843

53,987

62,157

15.7%

12.4%

Corporate1

(20,997)

(24,649)

(4,519)

(19,008)

(364.6%)

(29.7%)

Operating income

$    111,907

$    122,815

$    116,582

$    116,429

(4.0%)

5.5%

 Six Months Ended November 30, 

2013

2012

 % Change 

 GAAP 

 Cash Earnings 

 GAAP 

 Cash Earnings 

 GAAP 

 Cash Earnings 

Revenues:

United States

$    725,626

$    725,626

$    685,896

$    685,896

5.8%

5.8%

Canada

171,912

171,912

161,667

161,667

6.3%

6.3%

North America merchant services

897,538

897,538

847,563

847,563

5.9%

5.9%

Europe

290,054

290,054

259,626

259,626

11.7%

11.7%

Asia-Pacific

76,215

76,215

71,636

71,636

6.4%

6.4%

International merchant services

366,269

366,269

331,262

331,262

10.6%

10.6%

Total revenues

$ 1,263,807

$ 1,263,807

$ 1,178,825

$ 1,178,825

7.2%

7.2%

Operating income (loss) for segments:

North America merchant services

$    140,136

$    157,025

$    134,331

$    144,723

4.3%

8.5%

International merchant services

124,008

138,600

111,127

127,201

11.6%

9.0%

Corporate1

(44,853)

(48,958)

(48,388)

(38,832)

7.3%

(26.1%)

Operating income

$    219,291

$    246,667

$    197,070

$    233,092

11.3%

5.8%

1GAAP and cash earnings include incremental security spend for the three and six months ended November 30, 2013. GAAP earnings for the three and six months ended November 30, 2013 include insurance proceeds of ($7M) related to the FY2012 data intrusion.  GAAP earnings for the three and six months ended November 30, 2012 include a data intrusion (credit)/charge of ($14.5) million and $9.5M, respectively.

See Schedule 8 for reconciliation of cash earnings segment information to GAAP. 

 

SCHEDULE 4

CONSOLIDATED BALANCE SHEETS

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except share data)

November 30, 2013

May 31, 2013

(unaudited)

Assets

Current assets:

Cash and cash equivalents

$    1,096,833

$       680,470

Accounts receivable, net of allowances for doubtful accounts of $353 and $509, respectively

195,788

189,435

Claims receivable, net

662

1,156

Settlement processing assets

688,003

259,204

Inventory

8,886

11,057

Deferred income taxes

6,459

6,485

Prepaid expenses and other current assets

61,677

66,685

Total current assets

2,058,308

1,214,492

Goodwill

1,063,310

1,044,222

Other intangible assets, net

379,350

400,848

Property and equipment, net

357,880

348,064

Deferred income taxes

100,332

95,178

Other

22,384

22,252

Total assets

$    3,981,564

$    3,125,056

Liabilities and Equity

Current liabilities:

Lines of credit

$       446,508

$       187,461

Current portion of long-term debt

72,351

72,335

Accounts payable and accrued liabilities

235,361

262,890

Settlement processing obligations

798,671

162,558

Income taxes payable

20,114

18,870

  Total current liabilities

1,573,005

704,114

Long-term debt

922,545

891,134

Deferred income taxes

172,988

170,723

Other long-term liabilities

81,342

72,478

Total liabilities

2,749,880

1,838,449

Equity:

Preferred stock, no par value; 5,000,000 shares authorized and none issued

-

-

Common stock, no par value; 200,000,000 shares authorized; 71,908,829 issued and outstanding

 at November 30, 2013 and 75,426,099 issued and outstanding at May 31, 2013

-

-

Paid-in capital

188,281

202,396

Retained earnings

896,597

958,751

Accumulated other comprehensive income (loss)

2,235

(15,062)

      Total Global Payments shareholders' equity

1,087,113

1,146,085

Noncontrolling interest

144,571

140,522

Total equity

1,231,684

1,286,607

Total liabilities and equity

$    3,981,564

$    3,125,056

 

SCHEDULE 5

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands)

Six Months Ended November 30,

2013

2012

Cash flows from operating activities:

Net income

$         151,565

$      129,533

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization of property and equipment

28,439

26,494

Amortization of acquired intangibles

28,953

25,561

Share-based compensation expense

11,965

9,178

Provision for operating losses and bad debts

10,249

11,970

Deferred income taxes

6,073

30,055

Other, net

(4,345)

(2,231)

Changes in operating assets and liabilities, net of the effects of acquisitions:

Accounts receivable

(6,353)

721

Claims receivable

(6,567)

(6,600)

Settlement processing assets and obligations, net

204,307

(11,671)

Inventory

2,237

(4,297)

Prepaid expenses and other assets

5,761

(11,204)

Accounts payable and other accrued liabilities

(21,845)

(67,869)

Income taxes payable

1,244

(4,847)

Net cash provided by operating activities

411,683

124,793

Cash flows from investing activities:

Business, intangible and other asset acquisitions, net of cash acquired

(2,324)

(409,731)

Capital expenditures

(41,178)

(54,393)

Net decrease in financing receivables

1,328

1,485

Net proceeds from sales of investment and business

3,102

-

Net cash used in investing activities

(39,072)

(462,639)

Cash flows from financing activities:

Net borrowings (payments) on short-term lines of credit

259,047

(2,992)

Proceeds from issuance of long-term debt

810,000

910,327

Principal payments under long-term debt

(779,380)

(343,133)

Payment of debt issuance costs

-

(3,987)

Repurchase of common stock

(250,183)

(12,653)

Proceeds from stock issued under share-based compensation plans

27,366

7,080

Common stock repurchased - share-based compensation plans

(5,260)

(10,224)

Tax benefit from share-based compensation plans

4,415

1,791

Distribution to noncontrolling interests

(15,593)

(5,740)

Dividends paid

(2,894)

(3,153)

Net cash provided by financing activities

47,518

537,316

Effect of exchange rate changes on cash

(3,766)

17,516

Increase in cash and cash equivalents

416,363

216,986

Cash and cash equivalents, beginning of period

680,470

781,275

Cash and cash equivalents, end of period

$      1,096,833

$      998,261

 

SCHEDULE 6

RECONCILIATION OF QUARTERLY CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS TO GAAP

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except per share data)

Three Months Ended November 30, 2013

GAAP

Processing System Intrusion1

Other2

Cash Earnings Adjustments3

Cash Earnings

Revenues

$       634,122

$                    -

$                  -

$                  -

$       634,122

Operating expenses:

   Cost of service

235,170

-

-

(14,560)

220,610

   Sales, general and administrative

294,045

-

(3,348)

-

290,697

   Processing system intrusion

(7,000)

7,000

-

-

-

522,215

7,000

(3,348)

(14,560)

511,307

Operating income

111,907

(7,000)

3,348

14,560

122,815

Other income (expense):

   Interest and other income

5,288

-

(2,123)

-

3,165

   Interest and other expense

(8,025)

-

-

-

(8,025)

(2,737)

-

(2,123)

-

(4,860)

Income (loss) before income taxes 

109,170

(7,000)

1,225

14,560

117,955

(Provision) benefit  for income taxes

(29,313)

2,393

(1,145)

(4,808)

(32,873)

Net income (loss)

79,857

(4,607)

80

9,752

85,082

Less: Net income attributable to noncontrolling interests, net of income tax

(5,960)

-

-

(1,237)

(7,197)

Net income (loss) attributable to Global Payments

$         73,897

$           (4,607)

$                 80

$           8,515

$         77,885

Diluted shares

72,706

72,706

Diluted earnings (loss) per share

$             1.02

$              (0.07)

$             0.00

$             0.12

$             1.07

Three Months Ended November 30, 2012

GAAP

Processing System Intrusion

Other2

Cash Earnings Adjustments3

Cash Earnings

Revenues

$       588,538

$                    -

$                  -

$                  -

$       588,538

Operating expenses:

   Cost of service

210,268

-

-

(14,336)

195,932

   Sales, general and administrative

276,177

-

-

-

276,177

   Processing system intrusion

(14,489)

14,489

-

-

-

471,956

14,489

-

(14,336)

472,109

Operating income

116,582

(14,489)

-

14,336

116,429

Other income (expense):

   Interest and other income

2,187

-

-

-

2,187

   Interest and other expense

(14,609)

-

8,383

-

(6,226)

(12,422)

-

8,383

-

(4,039)

Income (loss) before income taxes 

104,160

(14,489)

8,383

14,336

112,390

(Provision) benefit  for income taxes

(28,789)

5,000

(1,383)

(4,213)

(29,385)

Net income (loss)

75,371

(9,489)

7,000

10,123

83,005

Less: Net income attributable to noncontrolling interests, net of income tax

(5,188)

-

(2,853)

(1,378)

(9,419)

Net income (loss) attributable to Global Payments

$         70,183

$           (9,489)

$           4,147

$           8,745

$         73,586

Diluted shares

79,144

79,144

Diluted earnings (loss) per share

$             0.89

$              (0.12)

$             0.05

$             0.11

$             0.93

1Represents insurance proceeds associated with processing system intrusion charges incurred in FY 2012.

2 For the period ended November 30, 2013, represents one-time charges primarily related to employee termination benefits and a one-time credit related to the gain on the sale of an interest in a business.  For the prior period, represents HSBC's share of GPAP dividends declared and the net income attributable to our Asia-Pacific redeemable noncontrolling interest.

3Represents adjustments to cost of service to exclude acquisition intangible amortization expense from net income and the related income tax benefit.

We supplemented our reporting of income and the related earnings per share information determined in accordance with GAAP by reporting income and the related earnings per share for the three months ended November 30, 2013 and 2012 on a "cash earnings" basis in this earnings release as a measure to help evaluate performance. We calculated income and earnings per share on a cash basis by excluding amounts related to the processing system intrusion, acquisition intangible amortization, one-time charges related to employee termination benefits, and a one-time credit related to the gain on the sale of an interest in a business.  In November 2012, we also adjusted the net income attributable to noncontrolling interests to include HSBC's share of second quarter 2013 GPAP net income and for HSBC's share of GPAP dividends. We exclude these charges in order to more clearly focus on the factors we believe are pertinent to the daily management of our operations. Our income and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, income and earnings per share determined in accordance with GAAP. Our measures of income and earnings per share on a cash earnings basis reflect management's judgment of particular items, and may not be comparable to similarly titled measures reported by other companies.

 

SCHEDULE 7

RECONCILIATION OF YEAR TO DATE CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS TO GAAP

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except per share data)

Six Months Ended November 30, 2013

GAAP

Processing System Intrusion 1

Other2

Cash Earnings Adjustments3

Cash Earnings

Revenues

$   1,263,807

$                       -

$                  -

$                  -

$   1,263,807

Operating expenses:

   Cost of service

465,915

-

(579)

(28,953)

436,383

   Sales, general and administrative

585,601

-

(4,844)

-

580,757

   Processing system intrusion

(7,000)

7,000

-

-

-

1,044,516

7,000

(5,423)

(28,953)

1,017,140

Operating income

219,291

(7,000)

5,423

28,953

246,667

Other income (expense):

   Interest and other income

8,626

-

(2,123)

-

6,503

   Interest and other expense

(15,904)

-

-

-

(15,904)

(7,278)

-

(2,123)

-

(9,401)

Income (loss) before income taxes 

212,013

(7,000)

3,300

28,953

237,266

(Provision) benefit  for income taxes

(60,448)

2,393

(1,934)

(9,570)

(69,559)

Net income (loss)

151,565

(4,607)

1,366

19,383

167,707

Less: Net income attributable to noncontrolling interests, net of income tax

(13,025)

-

-

(2,608)

(15,633)

Net income (loss) attributable to Global Payments

$       138,540

$               (4,607)

$           1,366

$         16,775

$       152,074

Diluted shares

73,504

73,504

Diluted earnings (loss) per share

$             1.88

$                 (0.07)

$             0.02

$             0.24

$             2.07

Six Months Ended November 30, 2012

GAAP

Processing System Intrusion

Other2

Cash Earnings Adjustments3

Cash Earnings

Revenues

$   1,178,825

$                       -

$                  -

$                  -

$   1,178,825

Operating expenses:

   Cost of service

414,659

-

(161)

(25,561)

388,937

   Sales, general and administrative

557,596

-

(800)

-

556,796

   Processing system intrusion

9,500

(9,500)

-

-

-

981,755

(9,500)

(961)

(25,561)

945,733

Operating income

197,070

9,500

961

25,561

233,092

Other income (expense):

   Interest and other income

4,170

-

-

-

4,170

   Interest and other expense

(18,154)

-

8,383

-

(9,771)

(13,984)

-

8,383

-

(5,601)

Income (loss) before income taxes 

183,086

9,500

9,344

25,561

227,491

(Provision) benefit  for income taxes

(53,553)

(3,279)

(1,533)

(7,573)

(65,938)

Net income (loss)

129,533

6,221

7,811

17,988

161,553

Less: Net income attributable to noncontrolling interests, net of income tax

(12,675)

-

(3,594)

(2,902)

(19,171)

Net income (loss) attributable to Global Payments

$       116,858

$                6,221

$           4,217

$         15,086

$       142,382

Diluted shares

79,062

79,062

Diluted earnings (loss) per share

$             1.48

$                   0.08

$             0.05

$             0.19

$             1.80

1Represents insurance proceeds associated with processing system intrusion charges incurred in FY 2012.

2 For the period ended November 30, 2013, represents one-time charges primarily related to employee termination benefits and resolution of a contract related contingency, and a one-time credit related to the gain on the sale of an interest in a business.  For the prior period, represents HSBC's share of GPAP dividends declared and the net income attributable to our Asia-Pacific redeemable noncontrolling interest.

3Represents adjustments to cost of service to exclude acquisition intangible amortization expense from net income and the related income tax benefit.

We supplemented our reporting of income and the related earnings per share information determined in accordance with GAAP by reporting income and the related earnings per share for the six months ended November 30, 2013 and 2012 on a "cash earnings" basis in this earnings release as a measure to help evaluate performance. We calculated income and earnings per share on a cash basis by excluding amounts related to the processing system intrusion, acquisition intangible amortization, one-time charges related to employee termination benefits and resolution of a contract related contingency, and a one-time credit related to the sale of an interest in a business.  In the six months ended November 2012, we also adjusted the net income attributable to noncontrolling interests to include HSBC's share of second quarter 2013 GPAP net income and for HSBC's share of GPAP dividends declared.  We exclude these charges in order to more clearly focus on the factors we believe are pertinent to the daily management of our operations. Our income and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, income and earnings per share determined in accordance with GAAP. Our measures of income and earnings per share on a cash earnings basis reflect management's judgment of particular items, and may not be comparable to similarly titled measures reported by other companies.

 

SCHEDULE 8

RECONCILIATION OF CASH EARNINGS SEGMENT INFORMATION TO GAAP

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands)

 Three Months Ended November 30,  

2013

2012

 GAAP 

Processing System Intrusion 1

Other2

Cash Earnings Adjustments3

 Cash Earnings 

 GAAP 

Processing System Intrusion

Other2

Cash Earnings Adjustments3

 Cash Earnings 

Revenues:

United States

$   361,793

$               -

$               -

$               -

$   361,793

$    339,998

$               -

$               -

$               -

$   339,998

Canada

85,240

-

-

-

85,240

80,770

-

-

-

80,770

  North America merchant services

447,033

-

-

-

447,033

420,768

-

-

-

420,768

Europe

146,866

-

-

-

146,866

131,161

-

-

-

131,161

Asia-Pacific

40,223

-

-

-

40,223

36,609

-

-

-

36,609

  International merchant services

187,089

-

-

-

187,089

167,770

-

-

-

167,770

     Total revenues

$   634,122

$               -

$               -

$               -

$   634,122

$    588,538

$               -

$               -

$               -

$   588,538

Operating income (loss) for segments:

North America merchant services

$      70,437

$               -

$               -

$        7,184

$      77,621

$      67,114

$               -

$               -

$        6,166

$      73,280

International merchant services

62,467

-

-

7,376

69,843

53,987

-

-

8,170

62,157

Corporate

(20,997)

(7,000)

3,348

-

(24,649)

(4,519)

(14,489)

-

-

(19,008)

     Operating income (loss)

$   111,907

$       (7,000)

$        3,348

$      14,560

$   122,815

$    116,582

$    (14,489)

$               -

$      14,336

$   116,429

 Six Months Ended November 30,  

2013

2012

 GAAP 

Processing System Intrusion 1

Other2

Cash Earnings Adjustments3

 Cash Earnings 

 GAAP 

Processing System Intrusion

Other2

Cash Earnings Adjustments3

 Cash Earnings 

Revenues:

United States

$   725,626

$               -

$               -

$               -

$   725,626

$    685,896

$               -

$               -

$               -

$   685,896

Canada

171,912

-

-

-

171,912

161,667

-

-

-

161,667

  North America merchant services

897,538

-

-

-

897,538

847,563

-

-

-

847,563

Europe

290,054

-

-

-

290,054

259,626

-

-

-

259,626

Asia-Pacific

76,215

-

-

-

76,215

71,636

-

-

-

71,636

  International merchant services

366,269

-

-

-

366,269

331,262

-

-

-

331,262

     Total revenues

$1,263,807

$               -

$               -

$               -

$1,263,807

$ 1,178,825

$               -

$               -

$               -

$1,178,825

Operating income (loss) for segments:

North America merchant services

$   140,136

$               -

$        2,518

$      14,371

$   157,025

$    134,331

$               -

$           905

$        9,487

$   144,723

International merchant services

124,008

-

10

14,582

138,600

111,127

-

-

16,074

127,201

Corporate

(44,853)

(7,000)

2,895

-

(48,958)

(48,388)

9,500

56

-

(38,832)

     Operating income (loss)

$   219,291

$       (7,000)

$        5,423

$      28,953

$   246,667

$    197,070

$        9,500

$           961

$      25,561

$   233,092

1Represents insurance proceeds associated with processing system intrusion charges incurred in FY 2012.

2Represents one-time charges primarily related to employee termination benefits and resolution of a contract related contingency for the period ending November 30, 2013 and the prior year represents one-time charges primarily related to employee termination benefits.

3Represents acquisition intangible amortization expense.

 

SCHEDULE 9

OUTLOOK SUMMARY

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In millions, except per share data)

Fiscal 2013 Actual

Fiscal 2014 Outlook

% Change FY13

Revenue Outlook

Total Revenues

$      2,376

$2,510 to $2,560

6% to 8%

EPS Outlook

Cash EPS 

$        3.65

$4.03 to $4.10

10% to 12%

Acquisition-related intangibles assets, non-recurring items and 

    processing system intrusion1

(0.89)

(0.58)

(35%)

GAAP Diluted EPS 

$        2.76

 $3.45 to $3.52 

25% to 28%

We supplemented our reporting of income and the related earnings per share information determined in accordance with GAAP by reporting income and the related earnings per share on a "cash earnings" basis in this earnings release as a measure to help evaluate performance. We calculated income and earnings per share on a cash basis by excluding costs related to the processing system intrusion, acquisition intangible amortization and one-time charges related to employee termination benefits and certain contract settlement and related costs. We exclude these charges in order to more clearly focus on the factors we believe are pertinent to the daily management of our operations. Our income and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, income and earnings per share determined in accordance with GAAP. Our measures of income and earnings per share on a cash earnings basis reflect management's judgment of particular items, and may not be comparable to similarly titled measures reported by other companies.

1  Fiscal 2014 reflects $0.48 of acquisition-related intangibles and $0.10 of non-recurring items.  Acquisition-related intangibles accounted and non-recurring items accounted for $0.57 in fiscal 2013 and processing intrusion costs were $0.32.  

 

 

SOURCE Global Payments Inc.



RELATED LINKS

http://www.globalpaymentsinc.com