Summary
Global Payments Inc. reported a solid increase in revenue for the third quarter ended February 28, 2011, with a 15% year-over-year rise to $456.4 million. This growth was primarily driven by strong performance in the North America Merchant Services segment, particularly the United States, and continued expansion in the International Merchant Services segment, notably in the Asia Pacific region. While overall operating income saw a modest increase for the quarter, a decrease was noted for the nine-month period, attributed to increased corporate expenses and competitive pressures in certain markets. The company also highlighted its acquisition of a 51% majority interest in Spain's merchant acquiring business, Comercia de “la Caixa”, on December 20, 2010, which contributed to the European segment's revenue growth. Financially, the company ended the quarter with a strong cash position of $1.33 billion. Investments in strategic growth initiatives, including acquisitions and technology platforms, are evident, with significant increases in goodwill and other intangible assets on the balance sheet. The company also managed its debt structure effectively, entering into a new $600 million revolving credit facility. Investors should note the company's ongoing focus on expanding its market share through direct sales channels and strategic acquisitions, balanced by efforts to manage operating expenses and margins.
Financial Highlights
51 data points| Revenue | $456.38M |
| SG&A Expenses | $209.85M |
| Operating Expenses | $378.18M |
| Operating Income | $78.20M |
| Net Income | $47.79M |
| EPS (Basic) | $0.30 |
| EPS (Diluted) | $0.29 |
| Shares Outstanding (Basic) | 159.79M |
| Shares Outstanding (Diluted) | 161.47M |
Key Highlights
- 1Revenue increased by 15% to $456.4 million for the three months ended February 28, 2011, compared to the prior year period.
- 2The North America Merchant Services segment saw a 13% revenue increase, driven by the US direct ISO channel, while International Merchant Services revenue grew by 20%.
- 3Acquired a 51% majority interest in Spain's merchant acquiring business (Comercia de “la Caixa”) on December 20, 2010, contributing to European revenue growth.
- 4Operating income increased by 6% to $78.2 million for the quarter, although it decreased by 3% for the nine-month period due to increased corporate expenses and competitive pressures.
- 5The company ended the period with a robust cash and cash equivalents balance of $1.33 billion.
- 6Goodwill and other intangible assets significantly increased, reflecting recent acquisitions and strategic investments.
- 7Entered into a new, unsecured five-year, $600 million revolving credit facility on December 7, 2010, to support growth initiatives.