Summary
Global Payments Inc. (GPN) reported its annual results for the fiscal year ending December 31, 2019, marked by the significant merger with Total System Services, Inc. (TSYS) in September 2019, a transaction valued at $24.5 billion. This merger dramatically expanded the company's scale and operational footprint. Financially, consolidated revenues saw a substantial increase to $4.91 billion, driven primarily by the TSYS acquisition. However, operating income saw a modest increase to $791.4 million, while operating margin declined to 16.1% from 21.9% in the prior year. This margin compression was largely attributed to increased acquisition and integration expenses related to the TSYS merger. Net income attributable to Global Payments decreased slightly to $430.6 million, and diluted earnings per share fell to $2.16 from $2.84, impacted by the increased share count from the merger and higher expenses. The company has reorganized into three reportable segments: Merchant Solutions, Issuer Solutions, and Business and Consumer Solutions. Despite the integration costs, Global Payments emphasizes its strategy to leverage its expanded global reach and technology solutions to drive future growth through innovation and potential strategic acquisitions, while also managing its increased debt levels resulting from the TSYS transaction.
Financial Highlights
53 data points| Revenue | $4.91B |
| Cost of Revenue | $2.07B |
| Gross Profit | $2.84B |
| SG&A Expenses | $2.05B |
| Operating Expenses | $4.12B |
| Operating Income | $791.42M |
| Interest Expense | $301.20M |
| Net Income | $430.61M |
| EPS (Basic) | $2.17 |
| EPS (Diluted) | $2.16 |
| Shares Outstanding (Basic) | 198.30M |
| Shares Outstanding (Diluted) | 199.13M |
Key Highlights
- 1Completed a $24.5 billion merger with Total System Services, Inc. (TSYS) in September 2019, significantly increasing scale and market presence.
- 2Consolidated revenues increased by 45.9% to $4.91 billion, primarily due to the TSYS acquisition.
- 3Operating income increased to $791.4 million, but operating margin decreased to 16.1% from 21.9% due to higher acquisition and integration expenses.
- 4Net income attributable to Global Payments decreased to $430.6 million from $452.1 million in the prior year.
- 5Diluted earnings per share decreased to $2.16 from $2.84, impacted by increased shares outstanding post-merger and higher expenses.
- 6Reorganized into three reportable segments: Merchant Solutions, Issuer Solutions, and Business and Consumer Solutions.
- 7Strengthened financial position with a new investment-grade debt structure, including $5.0 billion in unsecured credit facilities and $3.0 billion in unsecured senior notes.