Global Payments Inc.
Apr 2, 2013

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

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 Update
During 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 Outlook
For 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 Call
Global 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 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 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 1
UNAUDITED 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)