8-KEarnings & ResultsRegulation FDExhibits & Filings

Mastercard Inc 8-K Report, Financial Results (Feb 2, 2012)

Filed February 2, 2012For Securities:MA

Summary

Mastercard Inc. filed an 8-K report on February 2, 2012, to announce its financial results for the fourth quarter and full year ended December 31, 2011. The filing primarily serves to provide investors with access to the company's earnings press release and investor presentation, which were shared on the same date and are attached as exhibits. Key information for investors revolves around the reported financial performance and the methodologies used to present these results. Mastercard highlighted its use of non-GAAP financial measures, specifically excluding provisions for the financial portion of potential litigation settlements from operating expenses, operating income, net income, and earnings per share. The company also adjusted its effective tax rate on a pro forma basis to exclude income tax benefits related to these litigation provisions. Mastercard's management asserts that these adjusted measures provide a clearer view of ongoing operational performance and facilitate better period-over-period comparisons.

Key Highlights

  • 1Mastercard released its Q4 and full-year 2011 financial results on February 2, 2012.
  • 2The 8-K filing includes the company's earnings press release (Exhibit 99.1) and an investor presentation (Exhibit 99.2).
  • 3The company is reporting results on a pro forma basis, excluding provisions for potential litigation settlements.
  • 4Key financial metrics like operating expenses, operating income, net income, and EPS are presented excluding litigation settlement provisions.
  • 5The effective tax rate is also presented on a pro forma basis, excluding related income tax benefits.
  • 6Management uses these non-GAAP measures to evaluate ongoing operational performance and for internal planning.
  • 7Reconciliations between GAAP and non-GAAP measures are provided in the earnings release.

Frequently Asked Questions

This 8-K primarily announces Mastercard's financial results for the fourth quarter and the full year ended December 31, 2011. The specific figures are detailed in the accompanying press release (Exhibit 99.1) and presentation (Exhibit 99.2).

Mastercard is using non-GAAP measures to provide investors with a clearer view of its ongoing operational performance. By excluding provisions for potential litigation settlements and related tax benefits, the company aims to facilitate better comparisons of its results between different periods, as these items are considered separate from core operations.

The non-GAAP reporting excludes provisions for the financial portion of potential litigation settlements from total operating expenses, operating income, net income, and earnings per share. Additionally, income tax benefits associated with these litigation provisions are excluded from the effective tax rate calculation.

More detailed financial information, including the specific results and reconciliations between GAAP and non-GAAP measures, can be found in the attached press release (Exhibit 99.1) and the investor presentation (Exhibit 99.2) referenced in the 8-K filing.