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Press release from PR Newswire

Global Payments Reports Third Quarter Earnings for Fiscal 2013, Reaffirms Fiscal 2013 Annual Revenue and Cash Earnings Expectations

Tuesday, April 02, 2013

Global Payments Reports Third Quarter Earnings for Fiscal 2013, Reaffirms Fiscal 2013 Annual Revenue and Cash Earnings Expectations

16:01 EDT Tuesday, April 02, 2013

ATLANTA, April 2, 2013 /PRNewswire/ -- Global Payments Inc. (NYSE: GPN), a leading, worldwide provider of electronic transaction processing solutions, today announced results for its fiscal third quarter ended February 28, 2013. 

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

Third Quarter 2013 Summary

  • Revenue grew 8% to $578.7 million compared to $533.5 million in the third quarter of 2012.
  • Cash diluted earnings per share1 grew 5% to $0.87 compared to $0.83 in the third quarter of 2012.
  • GAAP diluted earnings per share were $0.75, compared to $0.73 in the third quarter of 2012.

Chairman and CEO Paul R. Garcia said, "We are pleased with the progress we have made on our strategic initiatives, and we are on track to achieve our full-year earnings expectations in 2013. These initiatives include focusing on expanding distribution channels through our partner of choice strategy, leveraging our technology infrastructure and driving innovation. We recently launched a number of innovative mobility and loyalty products to our worldwide merchants, and we are fully focused on expanding our unparalleled global footprint."

Data Remediation Expense UpdateDuring the third quarter, the company was returned to the list of PCI DSS compliant service providers and received reports on compliance covering all of the systems that process, store, transmit or otherwise utilize card data.  The company expects that net full-year 2013 expenses for the data intrusion will total approximately $20 million. Based on the assumption that the company will receive an additional  $10 million of insurance proceeds in fiscal 2014, the company estimates that the total cost for the processing system intrusion since inception will be approximately $95 million.

David Mangum, Senior Executive Vice President and CFO, stated,  "Now that the remediation work is behind us, we can turn our undivided attention to driving the business forward. We are grateful to our customers, partners and the card networks for their support as well as the significant efforts of our team."

2013 OutlookFor the full-year of fiscal 2013, the company continues to expect annual revenue of $2,360 million to $2,400 million, or 7% to 9% growth over fiscal 2012 and expected diluted earnings per share on a cash basis continue to be in a range of $3.64 to $3.71, or growth of 3% to 5% over fiscal 2012.

Annual fiscal 2013 GAAP diluted earnings per share have been revised to include the estimated impact of net intrusion remediation costs of $0.17 per share and are now expected to be in a range of $2.87 to $2.94. 

For reconciliation of expected full-year fiscal 2013 Cash Earnings to GAAP and constant currency, see schedule 9.

Conference CallGlobal Payments will hold a conference call today, April 2, 2013 at 5:00 p.m. EDT 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 April 16, 2013.  

About Global PaymentsGlobal 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 the United States, Canada, 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, including sovereign insolvency situations and a decline in the value of the U.S. dollar, and 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

Kay Sharpton

Amy Corn

770-829-8234

770-829-8870

770-829-8755

 

1 See Schedule 2 for Cash Earnings and Schedules 6 and 7 for Reconciliations of Cash Earnings to GAAP.

 

SCHEDULE 1UNAUDITED GAAP CONSOLIDATED STATEMENTS OF INCOME GLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands, except per share data)

Three Months Ended

Nine Months Ended

February 28, 2013

February 29, 2012

% Change

February 28, 2013

February 29, 2012

% Change

Revenues

578,746

533,539

8

%

1,757,571

1,606,815

9

%

Operating expenses:

Cost of service

217,465

194,218

12

%

632,124

571,685

11

%

Sales, general and administrative

271,696

246,973

10

%

829,292

737,593

12

%

Processing system intrusion

(1,189)

?

NM

8,311

?

NM

487,972

441,191

11

%

1,469,727

1,309,278

12

%

Operating income

90,774

92,348

(2)

%

287,844

297,537

(3)

%

Other income (expense):

Interest and other income

2,536

2,368

7

%

6,706

7,128

(6)

%

Interest and other expense

(7,063)

(3,698)

91

%

(25,217)

(12,663)

99

%

(4,527)

(1,330)

240

%

(18,511)

(5,535)

234

%

Income before income taxes

86,247

91,018

(5)

%

269,333

292,002

(8)

%

Provision for income taxes

(23,433)

(25,328)

(7)

%

(76,986)

(86,082)

(11)

%

Net income

62,814

65,690

(4)

%

192,347

205,920

(7)

%

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

(4,352)

(7,770)

(44)

%

(17,027)

(22,845)

(25)

%

Net income attributable to Global Payments

58,462

57,920

1

%

175,320

183,075

(4)

%

Earnings per share attributable to Global Payments:

Basic

$

0.75

$

0.74

1

%

$

2.24

$

2.32

(3)

%

Diluted

$

0.75

$

0.73

3

%

$

2.23

$

2.30

(3)

%

Weighted average shares outstanding:

Basic

77,756

78,421

78,364

78,937

Diluted

78,324

79,065

78,747

79,511

NM - Not Meaningful

 

SCHEDULE 2CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTSGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands, except per share data)

Three Months Ended

Nine Months Ended

February 28, 2013

February 29, 2012

% Change

February 28, 2013

February 29, 2012

% Change

Revenues

$

578,746

$

533,539

8

%

$

1,757,571

$

1,606,815

9

%

Operating expenses:

Cost of service

200,935

181,338

11

%

589,872

534,009

10

%

Sales, general and administrative

271,696

246,973

10

%

828,492

737,593

12

%

472,631

428,311

10

%

1,418,364

1,271,602

12

%

Operating income

106,115

105,228

1

%

339,207

335,213

1

%

Other income (expense):

Interest and other income

2,536

2,368

7

%

6,706

7,128

(6)

%

Interest and other expense

(7,063)

(3,698)

91

%

(16,834)

(12,663)

33

%

(4,527)

(1,330)

240

%

(10,128)

(5,535)

83

%

Income before income taxes

101,588

103,898

(2)

%

329,079

329,678

?

Provision for income taxes

(27,662)

(28,912)

(4)

%

(93,601)

(97,163)

(4)

%

Net income

73,926

74,986

(1)

%

235,478

232,515

1

%

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

(5,993)

(9,671)

(38)

%

(25,164)

(28,756)

(12)

%

Net income attributable to Global Payments

$

67,933

$

65,315

4

%

$

210,314

$

203,759

3

%

Basic earnings per share

$

0.87

$

0.83

5

%

$

2.68

$

2.58

4

%

Diluted earnings per share

$

0.87

$

0.83

5

%

$

2.67

$

2.56

4

%

Weighted average shares outstanding:

Basic

77,756

78,421

78,364

78,937

Diluted

78,324

79,065

78,747

79,511

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

 

SCHEDULE 3SEGMENT INFORMATIONGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands)

Three Months Ended

February 28, 2013

February 29, 2012

% Change

GAAP

Cash Earnings

GAAP

Cash Earnings

GAAP

Cash Earnings

Revenues:

United States

$

336,354

$

336,354

$

302,105

$

302,105

11

%

11

%

Canada

72,218

72,218

76,677

76,677

(6)

%

(6)

%

North America merchant services

408,572

408,572

378,782

378,782

8

%

8

%

Europe

130,750

130,750

116,196

116,196

13

%

13

%

Asia-Pacific

39,424

39,424

38,561

38,561

2

%

2

%

International merchant services

170,174

170,174

154,757

154,757

10

%

10

%

Total revenues

$

578,746

$

578,746

$

533,539

$

533,539

8

%

8

%

Operating income:

North America merchant services

$

55,478

$

63,210

$

62,462

$

65,697

(11)

%

(4)

%

International merchant services

51,820

60,618

47,911

57,556

8

%

5

%

Corporate1

(16,524)

(17,713)

(18,025)

(18,025)

8

%

2

%

Operating income

$

90,774

$

106,115

$

92,348

$

105,228

(2)

%

1

%

Nine Months Ended

February 28, 2013

February 29, 2012

% Change

GAAP

Cash Earnings

GAAP

Cash Earnings

GAAP

Cash Earnings

Revenues:

United States

$

1,022,250

$

1,022,250

$

882,946

$

882,946

16

%

16

%

Canada

233,885

233,885

253,419

253,419

(8)

%

(8)

%

North America merchant services

1,256,135

1,256,135

1,136,365

1,136,365

11

%

11

%

Europe

390,376

390,376

360,779

360,779

8

%

8

%

Asia-Pacific

111,060

111,060

109,671

109,671

1

%

1

%

International merchant services

501,436

501,436

470,450

470,450

7

%

7

%

Total revenues

$

1,757,571

$

1,757,571

$

1,606,815

$

1,606,815

9

%

9

%

Operating income:

North America merchant services

$

189,809

$

207,933

$

204,893

$

213,808

(7)

%

(3)

%

International merchant services

162,947

187,819

148,063

176,824

10

%

6

%

Corporate1

(64,912)

(56,545)

(55,419)

(55,419)

(17)

%

(2)

%

Operating income

$

287,844

$

339,207

297,537

$

335,213

(3)

%

1

%

1 Fiscal 2013 GAAP amounts include a processing intrusion credit of $1.2 million for the three months ended February 28, 2013 and processing intrusion costs of $8.3 million for the nine months ended February 28, 2013.

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

 

SCHEDULE 4CONSOLIDATED BALANCE SHEETSGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands)

February 28, 2013

May 31, 2012

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$

682,960

$

781,275

Accounts receivable, net of allowances for doubtful accounts of $478 and $532, respectively

166,271

182,962

Claims receivable, net of allowances for losses of $3,438 and $3,435, respectively

897

1,029

Settlement processing assets

208,471

217,994

Inventory

11,349

9,864

Deferred income taxes

6,350

21,969

Prepaid expenses and other current assets

70,564

33,646

Total current assets

1,146,862

1,248,739

Goodwill

1,051,614

724,687

Other intangible assets, net

412,995

290,188

Property and equipment, net of accumulated depreciation of $185,722 and $161,911, respectively

341,573

305,848

Deferred income taxes

93,626

97,235

Other

29,554

21,446

Total assets

$

3,076,224

$

2,688,143

LIABILITIES AND EQUITY

Current liabilities:

Lines of credit

$

167,152

$

215,391

Current portion of long-term debt

72,332

76,420

Accounts payable and accrued liabilities

227,367

316,313

Settlement processing obligations

201,190

216,878

Income taxes payable

5,787

12,283

Total current liabilities

673,828

837,285

Long-term debt

883,462

236,565

Deferred income taxes

162,389

106,644

Other long-term liabilities

71,307

62,306

Total liabilities

1,790,986

1,242,800

Commitments and contingencies

Redeemable noncontrolling interest

?

144,422

Equity:

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

?

?

Common stock, no par value; 200,000,000 shares authorized; 76,749,164 and 78,551,297 issued and outstanding at February 28, 2013 and May 31, 2012, respectively

?

?

Paid-in capital

207,666

358,728

Retained earnings

946,195

843,456

Accumulated other comprehensive income (loss)

(6,774)

(30,000)

Total Global Payments shareholders' equity

1,147,087

1,172,184

Noncontrolling interest

138,151

128,737

Total equity

1,285,238

1,300,921

Total liabilities and equity

$

3,076,224

$

2,688,143

 

SCHEDULE 5UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWSGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands)

Nine Months Ended

February 28, 2013

February 29, 2012

Cash flows from operating activities:

Net income

$

192,347

$

205,920

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation and amortization of property and equipment

40,856

35,821

Amortization of acquired intangibles

42,091

37,676

Share-based compensation expense

14,063

12,796

Provision for operating losses and bad debts

16,681

18,833

Deferred income taxes

27,282

5,858

Other, net

(3,692)

(949)

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

Accounts receivable

17,706

10,502

Claims receivable

(9,235)

(11,744)

Settlement processing assets and obligations, net

(12,028)

(523,802)

Inventory

(1,535)

(4,773)

Prepaid expenses and other assets

(34,898)

(2,388)

Accounts payable and other accrued liabilities

(78,375)

(22,211)

Income taxes payable

(6,496)

11,615

Net cash provided by (used in) operating activities

204,767

(226,846)

Cash flows from investing activities:

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

(433,427)

(44,245)

Capital expenditures

(75,016)

(71,084)

Net decrease in financing receivables

2,158

1,862

Net cash used in investing activities

(506,285)

(113,467)

Cash flows from financing activities:

Net payments on short-term lines of credit

(48,239)

(55,029)

Proceeds from issuance of long-term debt

1,085,327

71,374

Principal payments under long-term debt

(439,789)

(162,482)

Payment of debt issuance cost

(3,987)

?

Acquisition of redeemable noncontrolling interests

(242,000)

?

Proceeds from stock issued under share-based compensation plans

9,257

9,630

Common stock repurchased - share-based compensation plans

(10,215)

(4,847)

Repurchase of common stock

(137,653)

(99,604)

Tax benefit from employee share-based compensation

1,791

2,036

Distributions to noncontrolling interest

(13,656)

(24,334)

Dividends paid

(4,688)

(4,740)

Net cash provided by (used in) financing activities

196,148

(267,996)

Effect of exchange rate changes on cash

7,055

(10,243)

Decrease in cash and cash equivalents

(98,315)

(618,552)

Cash and cash equivalents, beginning of the period

781,275

1,354,285

Cash and cash equivalents, end of the period

$

682,960

$

735,733

 

SCHEDULE 6RECONCILIATION OF QUARTERLY CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS TO GAAPGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands, except per share data)

Three Months Ended February 28, 2013

GAAP

Processing System Intrusion

Cash Earnings Adjustments1

Cash Earnings

Revenues

$

578,746

?

?

$

578,746

Operating expenses:

Cost of service

217,465

?

(16,530)

200,935

Sales, general and administrative

271,696

?

?

271,696

Processing system intrusion

(1,189)

1,189

?

?

487,972

1,189

(16,530)

472,631

Operating income

90,774

(1,189)

16,530

106,115

Other income (expense):

Interest and other income

2,536

?

?

2,536

Interest and other expense

(7,063)

?

?

(7,063)

(4,527)

?

?

(4,527)

Income before income taxes

86,247

(1,189)

16,530

101,588

Provision for income taxes

(23,433)

232

(4,461)

(27,662)

Net income

62,814

(957)

12,069

73,926

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

(4,352)

?

(1,641)

(5,993)

Net income attributable to Global Payments

$

58,462

$

(957)

$

10,428

$

67,933

Diluted shares

78,324

78,324

Diluted earnings per share

$

0.75

$

(0.01)

$

0.13

$

0.87

Three Months Ended February 29, 2012

GAAP

Cash Earnings Adjustments1

Cash Earnings

Revenues

$

533,539

$

?

$

533,539

Operating expenses:

Cost of service

194,218

(12,880)

181,338

Sales, general and administrative

246,973

?

246,973

441,191

(12,880)

428,311

Operating income

92,348

12,880

105,228

Other income (expense):

Interest and other income

2,368

?

2,368

Interest and other expense

(3,698)

?

(3,698)

(1,330)

?

(1,330)

Income before income taxes

91,018

12,880

103,898

Provision for income taxes

(25,328)

(3,584)

(28,912)

Net income

65,690

9,296

74,986

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

(7,770)

(1,901)

(9,671)

Net income attributable to Global Payments

$

57,920

$

7,395

$

65,315

Diluted shares

79,065

79,065

Diluted earnings per share

$

0.73

$

0.10

$

0.83

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

We supplemented our reporting of net income and the related earnings per share information determined in accordance with GAAP by reporting net income and the related earnings per share for the three months ended February 28, 2013 and February 29, 2012 on a "cash earnings" basis in this earnings release as a measure to help evaluate performance. We calculated February 28, 2013 net income and earnings per share on a cash basis by excluding credits related to the processing system intrusion and acquisition intangible amortization.  We calculated February 29, 2012 net income and earnings per share on a cash basis by excluding acquisition intangible amortization from our results. We exclude these items in order to more clearly focus on the factors we believe are pertinent to the daily management of our operations. Our net income and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, net income and earnings per share determined in accordance with GAAP. Our measures of net 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 7RECONCILIATION OF YEAR TO DATE CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS TO GAAPGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands, except per share data)

Nine Months Ended February 28, 2013

GAAP

Processing System Intrusion

Other2

Cash Earnings Adjustments1

Cash Earnings

Revenues

$

1,757,571

?

?

?

$

1,757,571

Operating expenses:

Cost of service

632,124

?

(161)

(42,091)

589,872

Sales, general and administrative

829,292

?

(800)

?

828,492

Processing system intrusion

8,311

(8,311)

?

?

?

1,469,727

(8,311)

(961)

(42,091)

1,418,364

Operating income

287,844

8,311

961

42,091

339,207

Other income (expense):

Interest and other income

6,706

?

?

?

6,706

Interest and other expense

(25,217)

?

8,383

?

(16,834)

(18,511)

?

8,383

?

(10,128)

Income before income taxes

269,333

8,311

9,344

42,091

329,079

Provision for income taxes

(76,986)

(3,048)

(1,533)

(12,034)

(93,601)

Net income

192,347

5,263

7,811

30,057

235,478

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

(17,027)

(3,594)

(4,543)

(25,164)

Net income attributable to Global Payments

$

175,320

$

5,263

$

4,217

$

25,514

$

210,314

Diluted shares

78,747

78,747

Diluted earnings per share

$

2.23

$

0.07

$

0.05

$

0.32

$

2.67

Nine Months Ended February 29, 2012

GAAP

Cash Earnings Adjustments1

Cash Earnings

Revenues

$

1,606,815

$

?

$

1,606,815

Operating expenses:

Cost of service

571,685

(37,676)

534,009

Sales, general and administrative

737,593

?

737,593

1,309,278

(37,676)

1,271,602

Operating income

297,537

37,676

335,213

Other income (expense):

Interest and other income

7,128

?

7,128

Interest and other expense

(12,663)

?

(12,663)

(5,535)

?

(5,535)

Income before income taxes

292,002

37,676

329,678

Provision for income taxes

(86,082)

(11,081)

(97,163)

Net income

205,920

26,595

232,515

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

(22,845)

(5,911)

(28,756)

Net income attributable to Global Payments

$

183,075

$

20,684

$

203,759

Diluted shares

79,511

79,511

Diluted earnings per share

$

2.30

$

0.26

$

2.56

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

2 Represents HSBC's share of GPAP dividends declared and one-time charges primarily related to employee termination benefits.

We supplemented our reporting of net income and the related earnings per share information determined in accordance with GAAP by reporting net income and the related earnings per share for the nine months ended February 28, 2013 and February 29, 2012 on a "cash earnings" basis in this earnings release as a measure to help evaluate performance. We calculated February 28, 2013 net income and earnings per share on a cash basis by excluding costs related to the processing system intrusion, acquisition intangible amortization, the dividend paid to HSBC that was classified as interest expense, and one-time charges related to employee termination benefits. We also adjusted the net income attributable to noncontrolling interests to include HSBC's share of August 2012 through November 2012 GPAP net income. We calculated February 29, 2012 net income and earnings per share on a cash basis by excluding acquisition intangible amortization from our results. 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 net income and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, net income and earnings per share determined in accordance with GAAP. Our measures of net 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 8RECONCILIATION OF CASH EARNINGS SEGMENT INFORMATION TO GAAPGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In thousands, except per share data)

Three Months Ended February 28, 2013

Three Months Ended February 29, 2012

GAAP

Processing System Intrusion

Other

Cash Earnings Adjustments1

Cash Earnings

GAAP

Cash Earnings Adjustments1

Cash Earnings

Revenues:

United States

$

336,354

$

?

$

?

$

?

$

336,354

$

302,105

$

?

$

302,105

Canada

72,218

?

?

?

72,218

76,677

?

76,677

North America merchant services

408,572

?

?

?

408,572

378,782

?

378,782

Europe

130,750

?

?

?

130,750

116,196

?

116,196

Asia-Pacific

39,424

?

?

?

39,424

38,561

?

38,561

International merchant services

170,174

?

?

?

170,174

154,757

?

154,757

Total revenues

$

578,746

$

?

$

?

$

?

$

578,746

$

533,539

$

?

$

533,539

Operating income:

North America merchant services

$

55,478

$

?

$

?

$

7,732

$

63,210

62,462

$

3,235

$

65,697

International merchant services

51,820

?

?

8,798

60,618

47,911

9,645

57,556

Corporate

(16,524)

(1,189)

?

?

(17,713)

(18,025)

?

(18,025)

Operating income

$

90,774

$

(1,189)

$

?

$

16,530

$

106,115

92,348

$

12,880

$

105,228

Nine Months Ended February 28, 2013

Nine Months Ended February 29, 2012

GAAP

Processing System Intrusion

Other2

Cash Earnings Adjustments1

Cash Earnings

GAAP

Cash Earnings Adjustments1

Cash Earnings

Revenues:

United States

$

1,022,250

$

?

$

?

$

?

$

1,022,250

$

882,946

$

?

$

882,946

Canada

233,885

?

?

?

233,885

253,419

?

253,419

North America merchant services

1,256,135

?

?

?

1,256,135

1,136,365

?

1,136,365

Europe

390,376

?

?

?

390,376

360,779

?

360,779

Asia-Pacific

111,060

?

?

?

111,060

109,671

?

109,671

International merchant services

501,436

?

?

?

501,436

470,450

?

470,450

Total revenues

$

1,757,571

$

?

$

?

$

?

$

1,757,571

$

1,606,815

$

?

$

1,606,815

Operating income:

North America merchant services

$

189,809

$

?

$

905

$

17,219

$

207,933

$

204,893

$

8,915

$

213,808

International merchant services

162,947

?

?

24,872

187,819

148,063

28,761

176,824

Corporate

(64,912)

8,311

56

?

(56,545)

(55,419)

?

(55,419)

Operating income

$

287,844

$

8,311

$

961

$

42,091

$

339,207

$

297,537

$

37,676

$

335,213

1 Represents acquisition intangible amortization expense.

2 Represents one-time charges primarily related to employee termination benefits.

 

SCHEDULE 9OUTLOOK SUMMARYGLOBAL PAYMENTS INC. AND SUBSIDIARIES(In millions, except per share data)

Fiscal 2012 Actual

Fiscal 2013 Outlook

% Change FY12

Revenue Outlook

Constant currency1

$

2,204

$2,385 to $2,425

8% to 10%

Foreign currency impact2

NA

$(25)

Total Revenues

$

2,204

$2,360 to $2,400

7% to 9%

EPS Outlook

Constant currency1

$

3.53

$3.70 to $3.77

5% to 7%

Foreign currency impact2

NA

$(0.06)

Cash EPS

$

3.53

$3.64 to $3.71

3% to 5%

Acquisition-related intangible assets, non-recurring items and processing system intrusion3

(1.16)

$(0.77)

(34)%

GAAP Diluted EPS

$

2.37

$2.87 to $2.94

21% to 24%

We supplement our fiscal 2013 outlook of total revenues and earnings per share information determined in accordance with GAAP by reporting revenues and earnings per share on a "constant currency" basis in this earnings release as a measure to help evaluate performance.  We calculated revenues and earnings per share on a constant currency basis by converting our fiscal 2013 expected revenues and expenses at fiscal 2012 exchange rates.  We exclude the impact of exchange rate fluctuations in order to more clearly focus on the factors we believe are pertinent to the daily management of our operations, and our management uses constant currency measures to evaluate the impact of operational business decisions.  Our revenues and earnings per share reported on a constant currency basis should be considered in addition to, and not as a substitute for, revenues and earnings per share determined in accordance with GAAP. Our measures of revenues and earnings per share on a constant currency basis reflect management's judgment of particular items, and may not be comparable to similarly titled measures reported by other companies.

1 Reflects current period and forecasted results on a pro forma basis as if foreign currency rates did not change from the comparable prior year period.

2 Reflects the impact of actual and forecasted changes in foreign currency rates from the comparable prior year period.

3 Fiscal 2013 reflects $0.60 of acquisition-related intangibles and non-recurring items and $0.17 of processing system intrusion costs.  Acquisition-related intangibles accounted and non-recurring items accounted for $0.48 in fiscal 2012 and processing intrusion costs $0.68. 

NA=Not Applicable

 

SOURCE Global Payments Inc.

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