DENVER, Jan. 27 /PRNewswire-FirstCall/ -- First Data Corp. (NYSE: FDC)
today reported fourth quarter EPS of $0.56. As anticipated, results included
integration expenses of $0.03, and the quarter also included other charges of
$0.01.
"We are very excited about our strong 2004 results and are well-positioned
for continued growth in 2005," said Chairman and Chief Executive Officer
Charlie Fote. "Now that we are well into the Concord integration activities,
our employees and business partners are looking towards the future with even
greater enthusiasm."
The high quality of First Data's earnings generated cash flow from
operating activities of $2.3 billion, which is at the high end of the 2004
target. During the year, 88.2 million shares were repurchased for
$3.7 billion at an average price of $42.41. The company's current buy-back
authorization is $906 million.
The Western Union money transfer business, which represents 34% of First
Data revenue, achieved full-year revenue growth of 14%.
The agent network has exceeded 220,000 locations. The expansion of the
network, together with the continued investment in promoting the brand,
ensured another successful year demonstrated by consumer-to-consumer
transaction growth of 20% for the quarter and 19% for the year. Seven times a
second, every second of the year, customers trust Western Union to handle
their money transfer needs.
Ongoing investments in new products, marketing and loyalty programs also
drove results. WesternUnion.com posted a 50% increase in transaction activity
this year.
Merchant Services, which represents 36% of First Data revenue, continued
to deliver outstanding performance with year-over-year transaction growth of
13% including Concord's volume, when compared on a pro forma basis. This
success was the result of adding nine new bank relationships, expanding the
sales force by 18%, and increasing sales productivity 13%. New sales
generated 458,000 new merchants in 2004.
"We continue to be very pleased with our Concord acquisition," said Fote.
"This year we had great success in signing financial institutions to our STAR
network." As a result of solid execution on the integration plans, the
company achieved its 2004 cost-savings target of more than $30 million and is
on schedule to achieve total synergies of at least $205 million. In 2004,
many significant integration projects were completed including the integration
of the sales forces and product lines, as well as the merger of several
operating centers.
Outlook
"For 2005, our First Data team is focused on driving strong internal
growth, continuing to execute on our Concord integration and making
acquisitions that leverage our core strengths while at the same time using our
strong cash flow to enhance shareholder value. The global opportunities in
the payments industry are tremendous," Fote said.
Fote added that 2005 will show solid EPS performance, double-digit revenue
growth and superior cash flow. Full-year EPS is expected to be in the range
of $2.34-$2.43, prior to the planned $0.11 in estimated integration expenses,
and $2.23-$2.32 after considering integration expenses. This range assumes an
effective tax rate of 27%. This range does not include any impact from
expensing stock options as a result of adopting Financial Accounting Standards
Board's Statement No. 123R. The expense upon adoption will be affected
primarily by the company's adoption date, historical options, new option
grants, forfeitures and the valuation methodology selected going forward.
Business Segment Highlights
Western Union Money Transfer Exceeds $1 Billion in Profits for 2004
Western Union money transfer revenue increased 15% in the fourth quarter
to $908 million. Full-year revenue grew 14% to $3.4 billion. Operating
profits of $286 million for the quarter and $1.1 billion for the full year
grew 10% and 13%, respectively. Annual profit margin was 33%.
Western Union continues to grow around the world. International money
transfer transaction growth was strong at 24% in the fourth quarter, driving
revenue growth of 22%. Full-year international transaction and revenue growth
were also 24% and 22%, respectively.
Western Union branded transaction growth to Mexico remained extremely
strong in the quarter and for the year at 24%, with revenue growth of 13% for
the year and 14% for the quarter.
Even with Western Union's strong 2004 performance in Mexico, during the
year Italy surpassed it, becoming Western Union's second largest market.
During 2004, Western Union strengthened its position in Italy by making equity
investments in Angelo Costa S.p.A., and Finint Srl, its two largest Italian-
based super agents. Western Union will continue to invest in super agent
partners around the globe when and where it makes sense.
Growth in Western Union will continue through network expansion and
meeting customer demand for new products and services. Western Union was
recently granted a banking license by the Finanzmarktaufsicht Behoerde (FMA),
the Austrian Financial Market Authority, allowing Western Union to expand the
range of products and services offered to European consumers.
Several other key new agent signings in the fourth quarter included the
Polish Credit Union and Halcon Viajes, one of the largest travel agencies in
Spain. Each of these signings will add more than 1,000 locations. Growth in
China and India continues to be strong with more than 40,000 locations in
these two countries.
Finally, Payment Services' fourth quarter revenue was in line with
expectations at $1.1 billion. Operating profit was $303 million, 94% of which
was attributed to Western Union.
Merchant Services Results Powered by Excellent Transaction Growth
Merchant Services' revenues grew 50% for the fourth quarter to
$1.1 billion, with operating profit up 55% to $350 million. Full-year revenue
increased 44% to $3.8 billion and operating profit grew 37% to $990 million.
Full-year margins remained strong at 26%. Merchant Services delivered another
quarter of solid results driven by 64% transaction growth.
During the quarter, First Data sold a merchant portfolio to iPayment, Inc.
for $130 million in cash. This transaction, together with last year's sale of
another merchant portfolio to iPayment, reflects First Data's strategy of
maximizing returns on the merchant portfolio by selling non-sales supported
merchants to partners that can match sales forces to these merchants. First
Data and iPayment extended their long-term processing agreement.
Additionally, the iPayment's sales force will begin selling other First Data
product lines including debit, stored-value, and TeleCheck to its merchants on
a preferred provider basis.
As in the past, First Data will continue to review its merchant portfolios
and execute on initiatives which will maximize shareholder return. Year-over-
year the company recorded incremental after-tax gains of $19 million from
merchant portfolio sales.
Card Issuing Services Successfully Converts 58 Million Accounts
Card Issuing Services posted revenue of $609 million for the quarter, up
14% year-over-year and operating profit of $122 million, up 41% due primarily
to the acquisition of Concord. Full-year revenue of $2.4 billion and
operating profit of $508 million were up 14% and 64%, respectively. Annual
margin was 21%.
During 2004, Card Issuing Services completed account conversions for
11 clients totaling 58 million accounts. As of December 31, accounts on file
were 406 million. The pipeline of accounts to be converted has been reduced
to 34 million since year-end as a result of conversion activity of 16 million
so far this year.
During the quarter, First Data signed an agreement with Capital One
Financial Corporation to provide production services functions. These
services include statement services and plastics personalization, which will
be provided by the Card Issuing Services segment and remittance processing
services, which will be provided by First Data's REMITCO business unit. In
addition, Card Issuing Services renewed a card processing agreement with
World's Foremost Bank.
There were 135 million cards carrying the STAR logo at year-end and STAR
Systems also announced that it has extended agreements with Chevy Chase Bank
and CO-OP Network Credit Union Group.
Conference Call and Webcast
First Data will hold a conference call today at 8:00 a.m. EST to discuss
the company's fourth quarter and full-year results. Charlie Fote, chairman
and chief executive officer; Christina Gold, president of Western Union, Kim
Patmore, executive vice president and chief financial officer; and David
Banks, senior vice president of Investor Relations will host the call. The
call will be open to the public. The conference call can be accessed by
calling 888-831-9087 in the U.S. or 517-308-9004 internationally and passcode:
FDC. This call also will be broadcast on the company's Web site at
http://www.firstdata.com. Interested parties are encouraged to click on the webcast
link 10-15 minutes prior to the start of the conference call.
A replay of the conference call and the webcast will be available one hour
after the call concludes through 5:00 p.m. EST February 3, 2005. The replay
of the call is available at 866-459-3539 in the U.S. or 203-369-1328
internationally (no passcode required), and a replay of the webcast is
available at http://www.firstdata.com.
Please note: All statements made by First Data officers on this call are
the property of First Data and subject to copyright protection. Other than
the replay, First Data has not authorized, and disclaims responsibility for,
any recording, replay or distribution of any transcription of this call.
About First Data:
First Data Corp. (NYSE: FDC), with global headquarters in Denver, helps
power the global economy. As a leader in electronic commerce and payment
services, First Data serves approximately 4.1 million merchant locations,
1,400 card issuers and millions of consumers, making it easy, fast and secure
for people and businesses around the world to buy goods and services using
virtually any form of payment. With more than 30,000 employees worldwide, the
company provides credit, debit, private-label, smart and stored-value card
issuing and merchant transaction processing services; Internet commerce
solutions; money transfer services; money orders; and check guarantee and
verification services. The STAR(R) Network offers PIN-secured debit
acceptance at 1.4 million ATM and retail locations. First Data also offers a
variety of payment services to businesses around the world including those in
the United Kingdom, Australia, Canada, Japan, Mexico, Spain, Panama, Brazil,
China, the Netherlands, Greece, the Middle East and Germany. Its Western
Union and Orlandi Valuta money transfer networks include approximately 220,000
agent locations in more than 195 countries and territories. Visit
http://www.firstdata.com for more information.
Notice to Investors, Prospective Investors and the Investment Community
Cautionary Information Regarding Forward-Looking Statements
Statements in this press release regarding First Data Corporation's
business which are not historical facts, including the revenue and earnings
projections, are "forward-looking statements." All forward-looking statements
are inherently uncertain as they are based on various expectations and
assumptions concerning future events and they are subject to numerous known
and unknown risks and uncertainties which could cause actual events or results
to differ materially from those projected. Important factors upon which the
Company's forward-looking statements are premised include: (a) no
unanticipated developments that delay or negatively impact the integration of
Concord EFS, Inc. according to the Company's integration plans, including its
plans to integrate IT systems, eliminate duplicative overhead and costs, and
retain customers and critical employees; (b) continued growth at rates
approximating recent levels for card-based payment transactions, consumer
money transfer transactions and other product markets; (c) successful
conversions under service contracts with major clients; (d) renewal of
material contracts in the Company's business units consistent with past
experience; (e) timely, successful and cost-effective implementation of
processing systems to provide new products, improved functionality and
increased efficiencies; (f) successful and timely integration of significant
businesses and technologies acquired by the Company and realization of
anticipated synergies; (g) continuing development and maintenance of
appropriate business continuity plans for the Company's processing systems
based on the needs and risks relative to each such system; (h) absence of
further consolidation among client financial institutions or other client
groups which has a significant impact on FDC client relationships and no
material loss of business from significant customers of the Company; (i)
achieving planned revenue growth throughout the Company, including in the
merchant alliance program which involves several joint ventures not under the
sole control of the Company and each of which acts independently of the
others, and successful management of pricing pressures through cost
efficiencies and other cost management initiatives; (j) successfully managing
the credit and fraud risks in the Company's business units and the merchant
alliances, particularly in the context of the developing e-commerce markets;
(k) anticipation of and response to technological changes, particularly with
respect to e-commerce; (l) attracting and retaining qualified key employees;
(m) no unanticipated changes in laws, regulations, credit card association
rules or other industry standards affecting FDC's businesses which require
significant product redevelopment efforts, reduce the market for or value of
its products or render products obsolete; (n) continuation of the existing
interest rate environment so as to avoid increases in agent fees related to
Payment Services' products and increases in interest on the Company's
borrowings; (o) absence of significant changes in foreign exchange spreads on
retail money transfer transactions, particularly in high-volume corridors,
without a corresponding increase in volume or consumer fees; (p) continued
political stability in countries in which Western Union has material
operations; (q) implementation of Western Union agent agreements with
governmental entities according to schedule and no interruption of relations
with countries in which Western Union has or is implementing material agent
agreements; (r) no unanticipated developments relating to previously disclosed
lawsuits, investigations or similar matters; (s) no catastrophic events that
could impact the Company's or its major customer's operating facilities,
communication systems and technology or that has a material negative impact on
current economic conditions or levels of consumer spending; (t) no material
breach of security of any of our systems; and (u) successfully managing the
potential both for patent protection and patent liability in the context of
rapidly developing legal framework for expansive software patent protection.
NON-GAAP MEASURES
The financial information determined under U.S. generally accepted
accounting principles (GAAP) has been supplemented in this release with a non-
GAAP financial measure: 2005 earnings per share outlook excluding integration
expenses. Management believes that this adjusted measure provides meaningful
information to assist investors and analysts in understanding management's
expectation for the future performance of the Company. Management believes
this adjusted financial measure is important in understanding its projection
for 2005 because it excludes items that may obscure trends in the business and
allows our investors to better analyze trends in the Company's underlying
business. This adjusted financial measure should not be considered in
isolation or as a substitute for the most comparable GAAP financial measure.
This non-GAAP financial measure reflects an additional way of viewing aspects
of the Company's operations that, when viewed with the comparable GAAP
financial measure and the reconciliations to such measures, provide a more
complete understanding of management's projection for the performance of the
Company's business. Investors are strongly encouraged to review the financial
statements and publicly-filed reports in their entirety and not to rely on any
single financial measure.
FDC-1
FIRST DATA CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(in millions, except per share amounts)
Three Months Ended December 31,
2004 2003 Change
Revenues:
Transaction and processing service
fees:
Payment Services $1,012.3 $857.8 18%
Merchant Services 749.6 529.8 41%
Check verification and guarantee
services 101.2 98.9 2%
Card Issuing Services 429.0 346.8 24%
All other 30.0 36.2 -17%
Investment income, net (14.6) 38.0 NM
Professional services 19.5 28.3 -31%
Software licensing and maintenance 17.9 16.0 12%
Product sales and other 199.9 138.5 44%
Reimbursable postage and other 145.0 153.4 -5%
2,689.8 2,243.7 20%
Expenses:
Cost of services 1,372.9 1,108.3 24%
Cost of products sold 64.4 51.8 24%
Selling, general and administrative 450.3 365.8 23%
Reimbursable postage and other 145.0 153.4 -5%
Other operating expenses:
Restructuring, net 12.6 (1.0) NM
Impairments (6.9) 5.4 NM
2,038.3 1,683.7 21%
Operating profit 651.5 560.0 16%
Other income (expense):
Interest income 5.8 2.7 115%
Interest expense (40.7) (30.4) 34%
Investment gains and (losses) (3.7) (1.4) NM
Divestitures, net 0.1 -- NM
(38.5) (29.1) NM
Income before income taxes, minority
interest, equity earnings in affiliates
and discontinued operations 613.0 530.9 15%
Income taxes (i) 160.4 130.5 23%
Minority interest (32.9) (37.7) -13%
Equity earnings in affiliates 45.4 35.0 30%
Income from continuing operations 465.1 397.7 17%
Income from discontinued operations,
net of taxes of $0 and $6.7,
respectively (a) -- 3.9 NM
Net income $465.1 $401.6 16%
Earnings per share from continuing
operations:
Basic $0.57 $0.55 4%
Diluted $0.56 $0.54 4%
Earnings per share:
Basic $0.57 $0.55 4%
Diluted $0.56 $0.55 2%
Weighted-average shares outstanding:
Basic 816.5 726.8 12%
Diluted 828.0 735.5 13%
Shares outstanding at end of period 804.0 716.6 12%
(See accompanying notes)
FIRST DATA CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(in millions, except per share amounts)
Twelve Months Ended December 31,
2004 2003 Change
Revenues:
Transaction and processing service
fees:
Payment Services $3,720.4 $3,212.9 16%
Merchant Services 2,776.0 1,998.0 39%
Check verification and guarantee
services 405.4 389.2 4%
Card Issuing Services 1,677.3 1,362.1 23%
All other 127.5 144.1 -12%
Investment income, net 91.2 143.8 -37%
Professional services 89.9 102.9 -13%
Software licensing and maintenance 63.4 53.4 19%
Product sales and other 478.3 385.5 24%
Reimbursable postage and other 583.8 608.3 -4%
10,013.2 8,400.2 19%
Expenses:
Cost of services 5,140.6 4,235.1 21%
Cost of products sold 223.1 204.4 9%
Selling, general and administrative 1,610.5 1,375.0 17%
Reimbursable postage and other 583.8 608.3 -4%
Other operating expenses:
Restructuring, net 63.5 27.9 NM
Impairments 0.5 6.2 NM
Litigation and regulatory settlements 32.4 5.0 NM
Other 25.0 -- NM
7,679.4 6,461.9 19%
Operating profit 2,333.8 1,938.3 20%
Other income (expense):
Interest income 25.1 7.5 235%
Interest expense (136.8) (107.1) 28%
Investment gains and (losses) 5.9 (6.7) NM
Divestitures, net 265.2 6.8 NM
159.4 (99.5) NM
Income before income taxes, minority
interest, equity earnings in affiliates
and discontinued operations 2,493.2 1,838.8 36%
Income taxes (i) 674.7 463.9 45%
Minority interest (114.6) (119.6) -4%
Equity earnings in affiliates 163.9 138.7 18%
Income from continuing operations 1,867.8 1,394.0 34%
Income from discontinued operations,
net of taxes of $21.3 and $17.6,
respectively (a) 7.4 14.7 -50%
Net income $1,875.2 $1,408.7 33%
Earnings per share from continuing
operations:
Basic $2.26 $1.89 20%
Diluted $2.22 $1.86 19%
Earnings per share:
Basic $2.27 $1.91 19%
Diluted $2.23 $1.88 19%
Weighted-average shares outstanding:
Basic 827.0 739.1 12%
Diluted 840.2 749.2 12%
Shares outstanding at end of period 804.0 716.6 12%
(See accompanying notes)
FIRST DATA CORPORATION
SUMMARY SEGMENT DATA
(Unaudited)
(in millions)
Three Months Ended December 31,
2004 2003 Change
Revenues:
Payment Services $1,058.5 $958.9 10%
Merchant Services 1,121.1 748.6 50%
Card Issuing Services 608.5 531.7 14%
Subtotal segment revenues 2,788.1 2,239.2 25%
All Other and Corporate 56.2 68.8 -18%
2,844.3 2,308.0 23%
Adjustments for items included in
segment and All Other
and Corporate revenues: (b)
Equity earnings in affiliates (c) (54.8) (44.0) 25%
Interest income (5.8) (2.7) 115%
Divested business (d) -- 68.3 NM
Eliminations (e) (93.9) (85.9) NM
Consolidated revenue $2,689.8 $2,243.7 20%
Operating profit: (f)
Payment Services $303.4 $321.6 -6%
Merchant Services 350.3 225.3 55%
Card Issuing Services 121.5 86.0 41%
Subtotal segment operating
profit 775.2 632.9 22%
All Other and Corporate (43.9) (24.7) -78%
731.3 608.2 20%
Adjustments for items included in
segment and All Other and
Corporate operating profit: (b)
Equity earnings in affiliates (45.4) (35.0) 30%
Divested business (d) -- 10.5 NM
Minority interest from segment
operations (g) 33.0 37.9 -13%
Eliminations (e) (55.9) (54.5) NM
Interest expense (40.7) (30.4) 34%
Items excluded from segment
operations (h) (9.3) (5.8) NM
Income before income taxes,
minority interest, equity
earnings in affiliates and
discontinued operations $613.0 $530.9 15%
Depreciation & Amortization:
Payment Services $27.5 $26.7 3%
Merchant Services 91.8 56.8 62%
Card Issuing Services 66.0 52.4 26%
All Other and Corporate 6.9 7.0 -1%
Divested business -- 4.1 NM
Consolidated depreciation &
amortization $192.2 $147.0 31%
(See accompanying notes)
FIRST DATA CORPORATION
SUMMARY SEGMENT DATA
(Unaudited)
(in millions)
Twelve Months Ended December 31,
2004 2003 Change
Revenues:
Payment Services $4,043.3 $3,603.5 12%
Merchant Services 3,844.3 2,677.5 44%
Card Issuing Services 2,383.7 2,089.6 14%
Subtotal segment revenues 10,271.3 8,370.6 23%
All Other and Corporate 249.2 276.9 -10%
10,520.5 8,647.5 22%
Adjustments for items included in
segment and All Other
and Corporate revenues: (b)
Equity earnings in affiliates (c) (198.3) (170.6) 16%
Interest income (25.1) (7.5) 235%
Divested business (d) 58.1 269.7 NM
Eliminations (e) (342.0) (338.9) NM
Consolidated revenue $10,013.2 $8,400.2 19%
Operating profit: (f)
Payment Services $1,305.2 $1,228.1 6%
Merchant Services 990.3 723.2 37%
Card Issuing Services 508.1 309.9 64%
Subtotal segment operating
profit 2,803.6 2,261.2 24%
All Other and Corporate (95.1) (77.3) -23%
2,708.5 2,183.9 24%
Adjustments for items included in
segment and All Other and
Corporate operating profit: (b)
Equity earnings in affiliates (163.9) (138.7) 18%
Divested business (d) 11.2 40.5 NM
Minority interest from segment
operations (g) 136.8 122.0 12%
Eliminations (e) (212.3) (222.8) NM
Interest expense (136.8) (107.1) 28%
Items excluded from segment
operations (h) 149.7 (39.0) NM
Income before income taxes,
minority interest, equity
earnings in affiliates and
discontinued operations $2,493.2 $1,838.8 36%
Depreciation & Amortization:
Payment Services $104.0 $103.9 0%
Merchant Services 352.3 220.4 60%
Card Issuing Services 252.4 201.1 26%
All Other and Corporate 26.8 27.8 -4%
Divested business 2.7 16.1 NM
Consolidated depreciation &
amortization $738.2 $569.3 30%
(See accompanying notes)
FIRST DATA CORPORATION
NOTES TO FINANCIAL SCHEDULES
(Unaudited)
(a) Discontinued operations consist of NYCE.
(b) Reconciles the total segment and All Other and Corporate revenue to
consolidated revenue or total segment and All Other and Corporate
operating profit to income before income taxes, minority interest,
equity earnings in affiliates and discontinued operations as reported
on the Consolidated Statements of Income.
(c) Excludes equity losses that were recorded in expense of $1.5 million
and $4.1 million for the three and twelve months ended December 31,
2004 and $1.7 million and $4.0 million for the same periods in 2003,
and the amortization related to the excess of the investment balance
over the Company's proportionate share of the investee's net book
value for 2004 and 2003.
(d) The Company sold its 67% owned subsidiary, Global Cash Access,
("GCA") in March 2004. Revenue and operating profit associated with
GCA are excluded from segment results. The Merchant Services segment
revenue and operating profit were reclassified for 2003 to exclude
results from GCA.
(e) Represents elimination of adjustment to record Payment Services
segment revenues and operating profit on a pretax equivalent basis
and elimination of intersegment revenue.
(f) Segment and All Other and Corporate operating profit includes
interest income, minority interest from segment operations, equity
earnings in affiliates net of related amortization expense and the
allocation of corporate overhead. Segment and All Other and
Corporate operating profit excludes items discussed in note (h) below
and interest expense.
(g) Minority interest from segment operations excludes minority interest
attributable to items excluded from segment operations discussed in
note (h) below.
(h) Items, other than interest expense, excluded from segment operations
consist of the following:
Three months Twelve months
ended ended
December 31, December 31,
(in millions) 2004 2004
Restructuring charges of
$13.0 million and $65.6
million were recorded in
the three and twelve months
ended December 31, 2004,
offset with reversals of
excess restructuring
accruals of $0.4 million
and $2.1 million for three
Restructuring, and twelve months,
net $(12.6) $(63.5) respectively.
Impairment charges were
recorded for the three and
twelve months ended
December 31, 2004 related
primarily to software and
goodwill as a result of
business restructuring. A
$12.0 million recovery was
recorded for the three
months ended December 31,
2004, related to an
impairment of capitalized
customer contract costs
associated with a customer
bankruptcy recognized in
Impairments 6.9 (0.5) 2002.
Litigation charges were
recorded in the second and
third quarters related to
the anticipated settlement
Litigation and of a lawsuit associated
regulatory with the Merchant Services
settlements -- (32.4) segment.
Other related to adjustments
for TeleCheck accounting
entries that originated
primarily during 2002 and
Other -- (25.0) 2003.
Net investment gains in the
twelve months ended
December 31, 2004 relate to
the $12.2 million gain on
the sale of a strategic
investment in the third
quarter of 2004, offset by
losses on e-commerce
Investment businesses and other
gains and
(losses) (3.7) 5.9 business ventures.
Divestitures related to the
gain on the sale of GCA and
the release of $1.4 million
of divestiture accruals
Divestitures, related to the expiration
net 0.1 265.2 of certain contingencies.
(9.3) 149.7
Minority
interest 0.1 22.2
$(9.2) $171.9
Three months Twelve months
ended ended
December 31, December 31,
2003 2003
(in millions)
Restructuring charges of
$30.4 million were recorded
in the twelve months,
offset with reversals of
excess restructuring
accruals of $1.0 million
and $2.5 million for the
Restructuring, three and twelve months,
net $1.0 $(27.9) respectively.
Impairment charges were
recorded for the three and
twelve months ended
December 31, 2003, related
primarily to software in
the Card Issuing Services
Impairments (5.4) (6.2) segment.
A litigation charge of
$5.0 million was recorded in
the three months ended
September 30, 2003, related
Litigation and to a lawsuit associated
regulatory with the Merchant Services
settlements -- (5.0) segment.
Net investment losses of
$1.4 million and $6.7 million
were recorded in the three
and twelve months ended
December 31, 2003.
These losses were primarily
related to e-commerce
Investment businesses and strategic
gains and
(losses) (1.4) (6.7) investments.
Divestiture reserves of
$6.8 million were released
in the three months ended
September 30, 2003, related
Divestitures, to the passage of certain
net -- 6.8 exposures.
(5.8) (39.0)
Minority interest 0.2 2.4
$(5.6) $(36.6)
(i) The effective tax rate for the twelve months ended December 31, 2004
was impacted by the favorable resolution of federal and state issues
totaling $29 million. This non-cash tax benefit was recognized in
the second quarter 2004. The effective tax rate for the three and
twelve months ended December 31, 2003 was affected by higher than
anticipated tax free municipal interest and, to a larger extent, the
third quarter 2003 expiration of the statutory examination period for
a prior tax year.
NM = Not meaningful.
FIRST DATA CORPORATION
FINANCIAL TRANSACTION PROCESSING
KEY INDICATORS
(Unaudited)
(in millions)
At December 31, 2004 2003 Change
Card accounts on file
Domestic cards (a) 369.9 316.6 17%
International cards 36.1 31.2 16%
Total 406.0 347.8 17%
For the Three-Months Ended
December 31:
Payment Services transactions:
Consumer-to-consumer money
transfer (b) 26.39 22.07 20%
Consumer-to-business (c) 37.21 33.95 10%
North America merchant
transactions (d) 5,598.7 3,418.0 64%
North America issuer
transactions (e) 1,924.1 704.4 173%
For the Twelve-Months Ended
December 31:
Payment Services transactions:
Consumer-to-consumer money
transfer (b) 96.66 81.04 19%
Consumer-to-business (c) 146.13 134.01 9%
North America merchant
transactions (d) 19,829.4 12,269.3 62%
North America issuer
transactions (e) 6,818.9 2,605.9 162%
(a) Domestic card accounts on file at December 31, 2004 include
20.5 million accounts processed by the former Concord.
(b) Consumer-to-consumer money transfer transactions include North America
and international consumer money transfer services.
(c) Consumer-to-business transactions include Quick Collect, EasyPay,
PhonePay, Paymap's Just-in-Time and Equity Accelerator services, and
E Commerce Group's Speedpay transactions directly processed by
E Commerce Group.
(d) North America merchant transactions include acquired VISA and
MasterCard credit and signature debit, PIN-debit, electronic benefits
transactions ("EBT"), and processed-only or gateway customer
transactions at the point of sale ("POS"). North America merchant
transactions also include acquired ATM transactions, gateway
transactions at ATMs, and STAR PIN-debit POS transactions received
from other acquirers. Prior year historical FDC amounts have been
adjusted to conform to the current year presentation to include EBT.
(e) North America issuer transactions include VISA and MasterCard
signature debit, STAR ATM, STAR PIN-debit POS, and ATM and PIN-debit
POS gateway transactions.
SOURCE First Data Corp.
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Related links:
http://www.firstdata.com
CONTACT:
Investor Relations, David Banks,
+1-303-967-8057, david.banks@firstdata.com, or Media Relations,
Staci Busby, +1-303-967-7188, staci.busby@firstdata.com, both of
First Data Corp.
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