| [October 02, 2014] |
 |
Global Payments Reports First Quarter Earnings
ATLANTA --(Business Wire)--
Global Payments Inc. (NYSE: GPN) today announced results for its fiscal
first quarter ended August 31, 2014.
"We are delighted with our performance for the first quarter, which
represents an excellent start to our 2015 fiscal year and further
demonstrates the success of our focus on solid business execution and
disciplined capital deployment," said Jeff Sloan, Chief Executive
Officer. "We continue to expand our direct distribution globally and are
enthusiastic about our agreements to acquire Ezidebit and Fidelity
National Information Services' gaming business. Both of these
transactions underscore our strategy to drive direct sales growth in
attractive markets, deliver innovative products and solutions and
leverage technological advantages."
First Quarter 2015 Summary
-
Revenues grew 12% to $704.9 million, compared to $629.7 million in the
first quarter of fiscal 2014.
-
Cash diluted earnings per share1 grew 22% to $1.22,
compared to $1.00 in the first quarter of fiscal 2014.
-
GAAP diluted earnings per share were $1.10, compared to $0.87 in the
first quarter of 2014.
2015 Outlook
Cameron Bready, Executive Vice President and Chief Financial Officer,
stated, "As a result of our strong first quarter performance and the
anticipated closing of the Ezidebit transaction during our fiscal second
quarter, we are raising our annual fiscal 2015 revenue outlook to $2.74
billion to $2.79 billion, or 7% to 9% percent growth. In addition we are
increasing our outlook for annual fiscal 2015 diluted earnings per share
on a cash basis to a range of $4.65 to $4.75, reflecting growth of 13%
to 15% over fiscal 2014, and annual fiscal 2015 GAAP diluted earnings
per share is expected to be in the range of $3.89 to $3.99. We also now
expect annual fiscal 2015 core cash operating margins to expand by as
much as 40 basis points."
First Quarter 2015 Dividend
Global Payments' board of directors approved a fiscal 2015 first quarter
dividend of $0.02 per common share payable November 28, 2014 to
shareholders of record as of November 14, 2014.
Conference Call
Global Payments' management will host a conference call today, October
2, 2014 at 8:30 a.m. ET 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;
or callers in North America may dial 877-674-6428 and callers outside
North America may dial 970-315-0457. A replay of the call will be
archived on the company's website within two hours of the live call.
_________________________
1See Schedule 2 for cash earnings and Schedules 6 and 7 for
reconciliations of historical cash earnings to GAAP.
About Global Payments
Global Payments Inc. is one of the largest worldwide providers of
payment solutions for merchants, value added resellers, enterprise
software providers, financial institutions, government agencies,
multi-national corporations and independent sales organizations located
throughout North America, Brazil, Europe and the Asia-Pacific region.
Global Payments, a Fortune 1000 company, offers a comprehensive line of
solutions and services 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
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 our ability to
safeguard our data; increased competition from non-traditional
competitors; our ability to update our products and services in a timely
manner; potential systems interruptions or failures; software defects or
undetected errors; our ability to maintain Visa and MasterCard
registration and financial institution sponsorship; our reliance on
financial institutions to provide clearing services in connection with
our settlement activities; our potential failure to comply with card
network requirements; increased attrition of merchants, referral
partners or independent sales organizations; our ability to increase our
share of existing markets and expand into new markets; unanticipated
increases in chargeback liability; increases in credit card network
fees; changes in laws, regulations or network rules or interpretations
thereof; foreign currency exchange and interest rate risks; political,
economic and regulatory changes in the foreign countries in which we
operate; future performance, integration and conversion of acquired
operations; loss of key personnel; and other risks detailed in our SEC
filings, including the most recently filed Annual Report on Form 10-K.
We undertake no obligation to revise any of these statements to
reflect future circumstances or the occurrence of unanticipated events.
|
SCHEDULE 1
|
|
UNAUDITED GAAP CONSOLIDATED STATEMENTS OF INCOME
|
|
GLOBAL PAYMENTS INC. AND SUBSIDIARIES
|
|
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended August 31,
|
|
|
|
|
|
2014
|
|
2013
|
|
%
Change
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
704,895
|
|
|
$
|
629,685
|
|
|
11.9
|
%
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
Cost of service
|
|
|
259,839
|
|
|
|
230,745
|
|
|
12.6
|
%
|
|
Sales, general and administrative
|
|
|
320,658
|
|
|
|
291,556
|
|
|
10.0
|
%
|
|
|
|
|
580,497
|
|
|
|
522,301
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
124,398
|
|
|
|
107,384
|
|
|
15.8
|
%
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
Interest and other income
|
|
|
1,192
|
|
|
|
3,338
|
|
|
(64.3
|
)%
|
|
Interest and other expense
|
|
|
(11,010
|
)
|
|
|
(7,879
|
)
|
|
39.7
|
%
|
|
|
|
|
(9,818
|
)
|
|
|
(4,541
|
)
|
|
116.2
|
%
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
114,580
|
|
|
|
102,843
|
|
|
11.4
|
%
|
|
Provision for income taxes
|
|
|
(30,146
|
)
|
|
|
(31,135
|
)
|
|
(3.2
|
)%
|
|
Net income
|
|
|
84,434
|
|
|
|
71,708
|
|
|
17.7
|
%
|
|
Less: Net income attributable to noncontrolling interests, net of
income tax
|
|
|
(9,068
|
)
|
|
|
(7,065
|
)
|
|
28.4
|
%
|
|
Net income attributable to Global Payments
|
|
$
|
75,366
|
|
|
$
|
64,643
|
|
|
16.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share attributable to Global Payments:
|
|
|
|
|
|
|
|
Basic
|
|
$
|
1.11
|
|
|
$
|
0.88
|
|
|
26.1
|
%
|
|
Diluted
|
|
$
|
1.10
|
|
|
$
|
0.87
|
|
|
26.4
|
%
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
|
|
68,146
|
|
|
|
73,765
|
|
|
|
|
Diluted
|
|
|
68,617
|
|
|
|
74,289
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCHEDULE 2
|
|
CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS
|
|
GLOBAL PAYMENTS INC. AND SUBSIDIARIES
|
|
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended August 31,
|
|
|
|
|
2014
|
|
2013
|
|
%
Change
|
|
|
|
|
|
|
|
|
Revenues
|
$
|
704,895
|
|
|
$
|
629,685
|
|
|
11.9
|
%
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
Cost of service
|
|
241,985
|
|
|
|
215,773
|
|
|
12.1
|
%
|
|
Sales, general and administrative
|
|
323,599
|
|
|
|
290,060
|
|
|
11.6
|
%
|
|
|
|
565,584
|
|
|
|
505,833
|
|
|
11.8
|
%
|
|
|
|
|
|
|
|
|
Operating income
|
|
139,311
|
|
|
|
123,852
|
|
|
12.5
|
%
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
Interest and other income
|
|
1,192
|
|
|
|
3,338
|
|
|
(64.3
|
)%
|
|
Interest and other expense
|
|
(11,010
|
)
|
|
|
(7,879
|
)
|
|
39.7
|
%
|
|
|
|
(9,818
|
)
|
|
|
(4,541
|
)
|
|
116.2
|
%
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
129,493
|
|
|
|
119,311
|
|
|
8.5
|
%
|
|
Provision for income taxes
|
|
(35,430
|
)
|
|
|
(36,686
|
)
|
|
(3.4
|
)%
|
|
Net income
|
|
94,063
|
|
|
|
82,625
|
|
|
13.8
|
%
|
|
Less: Net income attributable to noncontrolling interests, net of
income tax
|
|
(10,303
|
)
|
|
|
(8,436
|
)
|
|
22.1
|
%
|
|
Net income attributable to Global Payments
|
$
|
83,760
|
|
|
$
|
74,189
|
|
|
12.9
|
%
|
|
|
|
|
|
|
|
|
Earnings per share attributable to Global Payments:
|
|
|
|
|
|
|
Basic
|
$
|
1.23
|
|
|
$
|
1.01
|
|
|
21.8
|
%
|
|
Diluted
|
$
|
1.22
|
|
|
$
|
1.00
|
|
|
22.0
|
%
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
Basic
|
|
68,146
|
|
|
|
73,765
|
|
|
|
|
Diluted
|
|
68,617
|
|
|
|
74,289
|
|
|
|
|
|
|
|
|
|
|
|
See Schedule 6 for a reconciliation of cash earnings to GAAP.
|
|
|
|
|
|
|
|
|
SCHEDULE 3
|
|
SEGMENT INFORMATION
|
|
GLOBAL PAYMENTS INC. AND SUBSIDIARIES
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended August 31,
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
% Change
|
|
|
|
GAAP
|
|
Cash
Earnings
|
|
GAAP
|
|
Cash
Earnings
|
|
GAAP
|
|
Cash
Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
$
|
414,042
|
|
|
$
|
414,042
|
|
|
$
|
363,833
|
|
|
$
|
363,833
|
|
|
13.8
|
%
|
|
13.8
|
%
|
|
Canada
|
|
|
89,965
|
|
|
|
89,965
|
|
|
|
86,672
|
|
|
|
86,672
|
|
|
3.8
|
%
|
|
3.8
|
%
|
|
North America merchant services
|
|
|
504,007
|
|
|
|
504,007
|
|
|
|
450,505
|
|
|
|
450,505
|
|
|
11.9
|
%
|
|
11.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe
|
|
|
162,787
|
|
|
|
162,787
|
|
|
|
143,188
|
|
|
|
143,188
|
|
|
13.7
|
%
|
|
13.7
|
%
|
|
Asia-Pacific
|
|
|
38,101
|
|
|
|
38,101
|
|
|
|
35,992
|
|
|
|
35,992
|
|
|
5.9
|
%
|
|
5.9
|
%
|
|
International merchant services
|
|
|
200,888
|
|
|
|
200,888
|
|
|
|
179,180
|
|
|
|
179,180
|
|
|
12.1
|
%
|
|
12.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
704,895
|
|
|
$
|
704,895
|
|
|
$
|
629,685
|
|
|
$
|
629,685
|
|
|
11.9
|
%
|
|
11.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) for segments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America merchant services
|
|
$
|
77,937
|
|
|
$
|
89,315
|
|
|
$
|
69,699
|
|
|
$
|
79,404
|
|
|
11.8
|
%
|
|
12.5
|
%
|
|
International merchant services
|
|
|
73,602
|
|
|
|
77,137
|
|
|
|
61,541
|
|
|
|
68,757
|
|
|
19.6
|
%
|
|
12.2
|
%
|
|
Corporate
|
|
|
(27,141
|
)
|
|
|
(27,141
|
)
|
|
|
(23,856
|
)
|
|
|
(24,309
|
)
|
|
(13.8
|
)%
|
|
(11.7
|
)%
|
|
Operating income
|
|
$
|
124,398
|
|
|
$
|
139,311
|
|
|
$
|
107,384
|
|
|
$
|
123,852
|
|
|
15.8
|
%
|
|
12.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Schedule 7 for reconciliation of cash earnings segment
information to GAAP.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCHEDULE 4
|
|
CONSOLIDATED BALANCE SHEETS
|
|
GLOBAL PAYMENTS INC. AND SUBSIDIARIES
|
|
(In thousands, except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
August 31, 2014
|
|
May 31, 2014
|
|
|
|
(unaudited)
|
|
|
|
ASSETS
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
595,884
|
|
|
$
|
581,872
|
|
|
Accounts receivable, net of allowances for doubtful accounts of $531
and $401, respectively
|
|
|
206,641
|
|
|
|
214,574
|
|
|
Claims receivable, net
|
|
|
758
|
|
|
|
809
|
|
|
Settlement processing assets
|
|
|
1,141,608
|
|
|
|
780,917
|
|
|
Inventory
|
|
|
5,660
|
|
|
|
6,636
|
|
|
Deferred income taxes
|
|
|
12,793
|
|
|
|
12,963
|
|
|
Prepaid expenses and other current assets
|
|
|
43,380
|
|
|
|
45,673
|
|
|
Total current assets
|
|
|
2,006,724
|
|
|
|
1,643,444
|
|
|
Goodwill
|
|
|
1,324,374
|
|
|
|
1,337,285
|
|
|
Other intangible assets, net
|
|
|
511,265
|
|
|
|
535,173
|
|
|
Property and equipment, net
|
|
|
363,415
|
|
|
|
369,753
|
|
|
Deferred income taxes
|
|
|
100,813
|
|
|
|
101,928
|
|
|
Other
|
|
|
32,765
|
|
|
|
31,067
|
|
|
Total assets
|
|
$
|
4,339,356
|
|
|
$
|
4,018,650
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Lines of credit
|
|
$
|
652,157
|
|
|
$
|
440,128
|
|
|
Current portion of long-term debt
|
|
|
31,250
|
|
|
|
17,677
|
|
|
Accounts payable and accrued liabilities
|
|
|
248,639
|
|
|
|
290,106
|
|
|
Settlement processing obligations
|
|
|
634,061
|
|
|
|
451,317
|
|
|
Income taxes payable
|
|
|
13,390
|
|
|
|
12,390
|
|
|
Total current liabilities
|
|
|
1,579,497
|
|
|
|
1,211,618
|
|
|
Long-term debt
|
|
|
1,388,750
|
|
|
|
1,376,002
|
|
|
Deferred income taxes
|
|
|
209,941
|
|
|
|
209,099
|
|
|
Other long-term liabilities
|
|
|
90,655
|
|
|
|
89,132
|
|
|
Total liabilities
|
|
|
3,268,843
|
|
|
|
2,885,851
|
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
Preferred stock, no par value; 5,000,000 shares authorized and none
issued
|
|
|
-
|
|
|
|
-
|
|
|
Common stock, no par value; 200,000,000 shares authorized;
67,672,753 issued and outstanding at August 31, 2014 and 68,845,643
issued and outstanding at May 31, 2014
|
|
|
-
|
|
|
|
-
|
|
|
Paid-in capital
|
|
|
139,141
|
|
|
|
183,023
|
|
|
Retained earnings
|
|
|
822,461
|
|
|
|
815,980
|
|
|
Accumulated other comprehensive loss
|
|
|
(19,351
|
)
|
|
|
(1,776
|
)
|
|
Total Global Payments shareholders' equity
|
|
|
942,251
|
|
|
|
997,227
|
|
|
Noncontrolling interests
|
|
|
128,262
|
|
|
|
135,572
|
|
|
Total equity
|
|
|
1,070,513
|
|
|
|
1,132,799
|
|
|
Total liabilities and equity
|
|
$
|
4,339,356
|
|
|
$
|
4,018,650
|
|
|
|
|
|
|
|
|
|
|
|
|
SCHEDULE 5
|
|
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
GLOBAL PAYMENTS INC. AND SUBSIDIARIES
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended August 31,
|
|
|
2014
|
|
2013
|
|
Cash flows from operating activities:
|
|
|
|
|
Net income
|
$
|
84,434
|
|
|
$
|
71,708
|
|
|
Adjustments to reconcile net income to net cash used in operating
activities:
|
|
|
|
|
Depreciation and amortization of property and equipment
|
|
16,712
|
|
|
|
13,981
|
|
|
Amortization of acquired intangibles
|
|
17,854
|
|
|
|
14,393
|
|
|
Share-based compensation expense
|
|
4,066
|
|
|
|
4,788
|
|
|
Provision for operating losses and bad debts
|
|
4,308
|
|
|
|
5,234
|
|
|
Deferred income taxes
|
|
3,705
|
|
|
|
5,784
|
|
|
Other, net
|
|
(755
|
)
|
|
|
(1,891
|
)
|
|
Changes in operating assets and liabilities, net of the effects
of acquisitions:
|
|
|
|
|
Accounts receivable
|
|
7,933
|
|
|
|
802
|
|
|
Claims receivable
|
|
(2,742
|
)
|
|
|
(3,864
|
)
|
|
Settlement processing assets and obligations, net
|
|
(179,462
|
)
|
|
|
(115,383
|
)
|
|
Inventory
|
|
981
|
|
|
|
4,448
|
|
|
Prepaid expenses and other assets
|
|
644
|
|
|
|
16,772
|
|
|
Accounts payable and other accrued liabilities
|
|
(22,151
|
)
|
|
|
(40,207
|
)
|
|
Income taxes payable
|
|
1,000
|
|
|
|
248
|
|
|
Net cash used in operating activities
|
|
(63,473
|
)
|
|
|
(23,187
|
)
|
|
Cash flows from investing activities:
|
|
|
|
|
Business, intangible and other asset acquisitions, net of cash
acquired
|
|
(4,773
|
)
|
|
|
-
|
|
|
Capital expenditures
|
|
(18,157
|
)
|
|
|
(20,263
|
)
|
|
Principal collections on financing receivables
|
|
219
|
|
|
|
665
|
|
|
Net proceeds from sales of investments and business
|
|
10,528
|
|
|
|
990
|
|
|
Net cash used in investing activities
|
|
(12,183
|
)
|
|
|
(18,608
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
Net borrowings on short-term lines of credit
|
|
212,029
|
|
|
|
141,026
|
|
|
Proceeds from issuance of long-term debt
|
|
390,000
|
|
|
|
440,000
|
|
|
Principal payments under long-term debt
|
|
(363,679
|
)
|
|
|
(331,515
|
)
|
|
Repurchase of common stock
|
|
(132,283
|
)
|
|
|
(143,700
|
)
|
|
Proceeds from stock issued under share-based compensation plans
|
|
12,588
|
|
|
|
3,998
|
|
|
Common stock repurchased - share-based compensation plans
|
|
(15,105
|
)
|
|
|
(4,604
|
)
|
|
Tax benefit from share-based compensation plans
|
|
3,154
|
|
|
|
1,213
|
|
|
Distributions to noncontrolling interests
|
|
(11,249
|
)
|
|
|
(12,482
|
)
|
|
Dividends paid
|
|
(1,370
|
)
|
|
|
(1,456
|
)
|
|
Net cash provided by financing activities
|
|
94,085
|
|
|
|
92,480
|
|
|
Effect of exchange rate changes on cash
|
|
(4,417
|
)
|
|
|
(5,268
|
)
|
|
Increase in cash and cash equivalents
|
|
14,012
|
|
|
|
45,417
|
|
|
Cash and cash equivalents, beginning of period
|
|
581,872
|
|
|
|
680,470
|
|
|
Cash and cash equivalents, end of period
|
$
|
595,884
|
|
|
$
|
725,887
|
|
|
|
|
|
|
|
|
|
|
|
SCHEDULE 6
|
|
RECONCILIATION OF CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS
TO GAAP
|
|
GLOBAL PAYMENTS INC. AND SUBSIDIARIES
|
|
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended August 31, 2014
|
|
|
|
GAAP
|
|
Other1
|
|
Cash Earnings
Adjustments2
|
|
Cash
Earnings
|
|
Revenues
|
|
$
|
704,895
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
704,895
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
Cost of service
|
|
|
259,839
|
|
|
|
-
|
|
|
|
(17,854
|
)
|
|
|
241,985
|
|
|
Sales, general and administrative
|
|
|
320,658
|
|
|
|
2,941
|
|
|
|
-
|
|
|
|
323,599
|
|
|
|
|
|
580,497
|
|
|
|
2,941
|
|
|
|
(17,854
|
)
|
|
|
565,584
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
124,398
|
|
|
|
(2,941
|
)
|
|
|
17,854
|
|
|
|
139,311
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
Interest and other income
|
|
|
1,192
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,192
|
|
|
Interest and other expense
|
|
|
(11,010
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(11,010
|
)
|
|
|
|
|
(9,818
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(9,818
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
114,580
|
|
|
|
(2,941
|
)
|
|
|
17,854
|
|
|
|
129,493
|
|
|
Provision for income taxes
|
|
|
(30,146
|
)
|
|
|
588
|
|
|
|
(5,872
|
)
|
|
|
(35,430
|
)
|
|
Net income
|
|
|
84,434
|
|
|
|
(2,353
|
)
|
|
|
11,982
|
|
|
|
94,063
|
|
|
Less: Net income attributable to noncontrolling interests, net of
income tax
|
|
|
(9,068
|
)
|
|
|
-
|
|
|
|
(1,235
|
)
|
|
|
(10,303
|
)
|
|
Net income attributable to Global Payments
|
|
$
|
75,366
|
|
|
$
|
(2,353
|
)
|
|
$
|
10,747
|
|
|
$
|
83,760
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares
|
|
|
68,617
|
|
|
|
|
|
|
|
68,617
|
|
|
Diluted earnings per share
|
|
$
|
1.10
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.15
|
|
|
$
|
1.22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended August 31, 2013
|
|
|
|
GAAP
|
|
Other1
|
|
Cash Earnings
Adjustments2
|
|
Cash
Earnings
|
|
Revenues
|
|
$
|
629,685
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
629,685
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
Cost of service
|
|
|
230,745
|
|
|
|
(579
|
)
|
|
|
(14,393
|
)
|
|
|
215,773
|
|
|
Sales, general and administrative
|
|
|
291,556
|
|
|
|
(1,496
|
)
|
|
|
-
|
|
|
|
290,060
|
|
|
|
|
|
522,301
|
|
|
|
(2,075
|
)
|
|
|
(14,393
|
)
|
|
|
505,833
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
107,384
|
|
|
|
2,075
|
|
|
|
14,393
|
|
|
|
123,852
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
Interest and other income
|
|
|
3,338
|
|
|
|
-
|
|
|
|
-
|
|
|
|
3,338
|
|
|
Interest and other expense
|
|
|
(7,879
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(7,879
|
)
|
|
|
|
|
(4,541
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(4,541
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
102,843
|
|
|
|
2,075
|
|
|
|
14,393
|
|
|
|
119,311
|
|
|
Provision for income taxes
|
|
|
(31,135
|
)
|
|
|
(789
|
)
|
|
|
(4,762
|
)
|
|
|
(36,686
|
)
|
|
Net income
|
|
|
71,708
|
|
|
|
1,286
|
|
|
|
9,631
|
|
|
|
82,625
|
|
|
Less: Net income attributable to noncontrolling interests, net of
income tax
|
|
|
(7,065
|
)
|
|
|
-
|
|
|
|
(1,371
|
)
|
|
|
(8,436
|
)
|
|
Net income attributable to Global Payments
|
|
$
|
64,643
|
|
|
$
|
1,286
|
|
|
$
|
8,260
|
|
|
$
|
74,189
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares
|
|
|
74,289
|
|
|
|
|
|
|
|
74,289
|
|
|
Diluted earnings per share
|
|
$
|
0.87
|
|
|
$
|
0.02
|
|
|
$
|
0.11
|
|
|
$
|
1.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1For the three months ended August 31, 2014, represents
a gain on the sale of a component of our Russia business that leased
ATMs to our sponsor bank in Russia. For the three months ended
August 31, 2013, represents one-time charges primarily related to
employee termination benefits and resolution of a contract related
contingency.
|
|
|
|
|
2Represents adjustments to cost of service to exclude
acquisition intangible amortization expense 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
August 31, 2014 and 2013 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 a gain on the sale of a component of our Russia business
that leased ATMs to our sponsor bank in Russia and acquisition
intangible amortization. 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 CASH EARNINGS SEGMENT INFORMATION TO GAAP
|
|
GLOBAL PAYMENTS INC. AND SUBSIDIARIES
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended August 31,
|
|
|
2014
|
|
|
2013
|
|
|
GAAP
|
|
Other1
|
|
Cash Earnings
Adjustments2
|
|
Cash
Earnings
|
|
|
GAAP
|
|
Other1
|
|
Cash Earnings
Adjustments2
|
|
Cash
Earnings
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
$
|
414,042
|
|
|
$
|
-
|
|
|
$
|
-
|
|
$
|
414,042
|
|
|
|
$
|
363,833
|
|
|
$
|
-
|
|
|
$
|
-
|
|
$
|
363,833
|
|
|
Canada
|
|
89,965
|
|
|
|
-
|
|
|
|
-
|
|
|
89,965
|
|
|
|
|
86,672
|
|
|
|
-
|
|
|
|
-
|
|
|
86,672
|
|
|
North America merchant services
|
|
504,007
|
|
|
|
-
|
|
|
|
-
|
|
|
504,007
|
|
|
|
|
450,505
|
|
|
|
-
|
|
|
|
-
|
|
|
450,505
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe
|
|
162,787
|
|
|
|
-
|
|
|
|
-
|
|
|
162,787
|
|
|
|
|
143,188
|
|
|
|
-
|
|
|
|
-
|
|
|
143,188
|
|
|
Asia-Pacific
|
|
38,101
|
|
|
|
-
|
|
|
|
-
|
|
|
38,101
|
|
|
|
|
35,992
|
|
|
|
-
|
|
|
|
-
|
|
|
35,992
|
|
|
International merchant services
|
|
200,888
|
|
|
|
-
|
|
|
|
-
|
|
|
200,888
|
|
|
|
|
179,180
|
|
|
|
-
|
|
|
|
-
|
|
|
179,180
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
$
|
704,895
|
|
|
$
|
-
|
|
|
$
|
-
|
|
$
|
704,895
|
|
|
|
$
|
629,685
|
|
|
$
|
-
|
|
|
$
|
-
|
|
$
|
629,685
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) for segments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America merchant services
|
|
77,937
|
|
|
|
-
|
|
|
|
11,378
|
|
|
89,315
|
|
|
|
|
69,699
|
|
|
|
2,518
|
|
|
|
7,187
|
|
|
79,404
|
|
|
International merchant services
|
|
73,602
|
|
|
|
(2,941
|
)
|
|
|
6,476
|
|
|
77,137
|
|
|
|
|
61,541
|
|
|
|
10
|
|
|
|
7,206
|
|
|
68,757
|
|
|
Corporate
|
|
(27,141
|
)
|
|
|
-
|
|
|
|
-
|
|
|
(27,141
|
)
|
|
|
|
(23,856
|
)
|
|
|
(453
|
)
|
|
|
-
|
|
|
(24,309
|
)
|
|
Operating income
|
$
|
124,398
|
|
|
$
|
(2,941
|
)
|
|
$
|
17,854
|
|
$
|
139,311
|
|
|
|
$
|
107,384
|
|
|
$
|
2,075
|
|
|
$
|
14,393
|
|
$
|
123,852
|
|
|
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1 For the three months ended August 31, 2014, represents a
gain on the sale of a component of our Russia business that leased ATMs
to our sponsor bank in Russia. For the three months ended August 31,
2013, represents one-time charges primarily related to employee
termination benefits and resolution of a contract related contingency.
2 Represents acquisition intangible amortization expense.
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SCHEDULE 8
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OUTLOOK SUMMARY
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GLOBAL PAYMENTS INC. AND SUBSIDIARIES
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(In billions, except per share data)
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Fiscal 2014
Actual
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Fiscal 2015
Outlook
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% Change
FY14
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Revenue Outlook
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Total Revenues
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$
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2.55
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$2.74 to $2.79
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7% to 9%
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EPS Outlook
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Cash EPS
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$
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4.12
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$4.65 to $4.75
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13% to 15%
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Acquisition-related intangibles assets, non-recurring items and
processing system intrusion1
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(0.75
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)
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(0.76
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)
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1%
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GAAP Diluted EPS
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$
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3.37
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$3.89 to $3.99
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15% to 18%
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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 fiscal years 2015
and 2014 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, acceleration of equity awards and other costs
associated with the retirement of our former Chairman and CEO, a
nonrecurring charge associated with our retained interest in Brazil,
non-cash losses from the retirement of fixed assets, employee
termination benefits and resolution of a contract related
contingency and an adjustment to the costs associated with the debt
refinancing. 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.
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1 Fiscal 2015 reflects $0.72 of acquisition-related
intangibles amortization and $0.04 of one-time charges. Fiscal
2014 reflects acquisition-related intangibles amortization of
$0.51, processing system intrusion of ($0.07), and non-recurring
items of $0.31. Other non-recurring items include acceleration of
equity awards and other costs associated with the retirement of
our former Chairman and CEO, a credit related to the sale of an
interest in our Brazil business and a subsequent charge associated
with our retained interest, cost associated with the debt
refinancing we completed in February 2014, non-cash losses from
the retirement of fixed assets, charges related to employee
termination benefits and HSBC's share of dividends declared by
Global Payments Asia-Pacific.
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