DENVER, Feb. 3 /PRNewswire-FirstCall/ -- First Data Corp. (NYSE: FDC), a
global leader in electronic commerce and payment services, today announced
fourth quarter and full-year results.
"Our 29,000 employees delivered another year of high-quality revenue,
earnings and cash flow," said Charlie Fote, chairman and chief executive
officer, First Data.
Operating Highlights
* Fourth quarter earnings per share (EPS) rose 20% to $0.55, compared
with $0.46 in the prior year fourth quarter. Fourth quarter EPS from
continuing operations rose 17% to $0.54 from $0.46 in fourth quarter
2002. ("Continuing operations" excludes results from NYCE, which is
accounted for as a discontinued operation.)
* 2003 EPS of $1.88, which included $0.03 of charges, rose 17%, compared
to 2002 EPS of $1.61, which included $0.05 of charges.
* Annual net income increased to $1.4 billion. Full-year revenues from
continuing operations increased 12% to $8.4 billion, with fourth
quarter revenues growing 11%.
* Full-year cash flow from operations increased to approximately
$2 billion.
* During 2003, the company repurchased 36.8 million shares of stock for
$1.5 billion at an average price of $39.69 per share. The remaining
authorization for stock repurchases is $1.146 billion.
* Western Union and ValueLink, combined, handled more than one billion
transactions in 2003, up 26%. Merchant Services transactions were
12.2 billion in 2003, up 23%.
Outlook
Fote said that expected cash outlays of approximately $150 million during
2004 relating to integration and restructuring are in line with the company's
previous projections. From an accounting standpoint, these cash outlays could
negatively affect First Data's 2004 EPS range by up to 10 cents per share,
depending on the timing of the execution of the Concord merger integration
plan and the timing of the NYCE divestiture. This results in an EPS range for
2004 of $2.00 to $2.18 from continuing operations.
"Included in the 2004 EPS range is the slightly dilutive impact resulting
from the Concord merger," Fote said. "Our primary focus in 2004 is executing
the plan to combine these two companies."
The company also updated its long-term growth objectives, reiterating its
long-term EPS growth range of 14-17% with long-term revenue growth in the
double digits. For 2004, Fote said he expected revenue growth of greater than
20% due to the Concord EFS merger.
Business Segment Highlights
Payment Services, comprised primarily of Western Union, achieved solid
revenue growth of 15% (12% excluding the impact of the strong Euro) in 2003 to
$3.7 billion. Annual operating profits increased 18% to $1.2 billion with
profit margins improving to 34% from 33% in 2002. Fourth quarter revenue of
$973 million and operating profits of $323 million each grew 13% compared with
fourth quarter 2002. The strength of Western Union is its ability to handle
transactions securely and reliably. For the first time, Western Union and
ValueLink handled more than one billion annual transactions for consumers and
businesses globally. Consumer-to-consumer, consumer-to-business and prepaid
transactions grew 19%, 12% and 32%, respectively.
In Mexico, money transfer transactions remained strong with annual growth
of 22%, driving revenue growth of 16%. International transaction and revenue
growth were 25% and 24%, respectively, for the year. Forty-nine of the top
50 countries achieved positive transaction growth in 2003.
Western Union finished the year with more than 182,000 agent locations, a
21% increase over the prior year. Today, more than 70% of Western Union's
agent locations operate outside the United States, many in key developing
countries around the world. Western Union has more than 25,000 locations in
India and China supporting worldwide corridor transactions to those countries.
Significant location rollouts during 2003 included: 10,000 in Europe; 9,000 in
India and China; 3,000 in Australia; and 2,000 in the Middle East, primarily
in Pakistan.
Merchant Services achieved strong results for the year with 14% revenue
growth to $3.0 billion and operating profit growth of 13% to $807 million.
Fourth quarter revenues of $826 million grew 18%, and operating profits of
$245 million grew 24%. Margins were 27% for the year. Merchant transactions
grew 23% for the year and 20% for the quarter.
During the quarter, First Data sold an agent bank and merchant portfolio
to iPayment, Inc. for $55 million in cash and extended a long-term processing
contract with iPayment. This transaction aligned approximately 170 small
agent banks with iPayment and strengthens an existing strategic relationship
between iPayment and First Data. The transaction provides an enhanced channel
for Merchant Services to expand processing services for new merchant accounts
by matching a previously unaligned portfolio with a processing partner
specializing in agent banks. The company recorded an after-tax gain of
$32 million as a result of the sale.
The gain was partially offset by reinvestments in the business including
low-margin, start-up international businesses, the expansion of our Merchant
and TeleCheck sales forces, and Concord integration costs.
Card Issuing Services for the year posted revenue of $2.0 billion, up
6% year-over-year. Operating profits of $306 million declined as a result of
pricing adjustments, decreasing sub-prime business and the effect on revenue
per account from the shift in mix from bank card to debit and retail private
label accounts.
Card Issuing Services completed 41 separate client conversions totaling
nearly 36 million accounts. The pipeline of accounts to be converted is
approximately 70 million accounts, with all of the accounts scheduled for
conversion by the end of 2004. As of December 31, accounts on file were
348 million.
Card Issuing Services reached two new agreements. An agreement with
Providian provides for statement services and plastics personalization for
Providian's 10.5 million customers. An agreement with Countrywide Home Loans,
Inc. provides for processing their EquitySmart(TM) MasterCard(R), which
combines the power of a home equity line of credit with the convenience of a
credit card. In addition, First Data and Bank One agreed to extend the
processing agreement originally scheduled to end June 30, 2004.
Emerging Payments, First Data's eONE Global business reported $151 million
in revenue for the year.
Discontinued Operations
On December 15, 2003, First Data announced an agreement with the U.S.
Department of Justice that will allow the company to complete its pending
merger with Concord. First Data agreed to divest its 64% ownership of NYCE,
an electronic funds transfer network. Therefore, NYCE is presented as a
discontinued operation in First Data's financial results.
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, full-year financial performance and 2004
outlook. Charlie Fote, chairman and chief executive officer; 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 212-519-0818 (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
February 4 at 8:00 a.m. EST through 5:00 p.m. EST February 11, 2004. The
replay of the call is available at 800-947-0911 in the U.S. or 402-220-3469
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. Recording of
the call is prohibited without the express written consent of First Data.
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 3.1 million merchant locations,
1,400 card issuers and millions of consumers, making it easy, fast and secure
for people and businesses to buy goods and services using virtually any form
of payment. With 29,000 employees worldwide, the company provides credit,
debit, smart card and stored-value card issuing and merchant transaction
processing services; Internet commerce solutions; money transfer services;
money orders; and check processing and verification services throughout the
United States. First Data also offers a variety of payment services in the
United Kingdom, Australia, Canada, Japan, Mexico, Spain, the Netherlands, the
Middle East and Germany. Its Western Union and Orlandi Valuta money transfer
networks include a total of approximately 182,000 agent locations in more than
195 countries and territories.
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) receipt of Concord shareholder
approval without any unexpected delay and no material deterioration in
Concord's business prior to closing; (c) the divestiture of NYCE Corporation
within the time period allowed in the Company's agreement with the Department
of Justice on terms reasonable to the Company; (d) continued growth at rates
approximating recent levels for card-based payment transactions, consumer
money transfer transactions and other product markets; (e) successful
conversions under service contracts with major clients; (f) renewal of
material contracts in the Company's business units consistent with past
experience; (g) timely, successful and cost-effective implementation of
processing systems to provide new products, improved functionality and
increased efficiencies; (h) successful and timely integration of significant
businesses and technologies acquired by the Company and realization of
anticipated synergies; (i) 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; (j) absence of
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; (k) 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; (l) 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; (m) anticipation of and
response to technological changes, particularly with respect to e-commerce;
(n) attracting and retaining qualified key employees; (o) 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; (p) 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; (q)
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; (r) continued political
stability in countries in which Western Union has material operations; (s)
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; (t) no
unanticipated developments relating to previously disclosed lawsuits,
investigations or similar matters; (u) 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; (v) no material
breach of security of any of our systems; and (w) successfully managing the
potential both for patent protection and patent liability in the context of
rapidly developing legal framework for expansive software patent protection.
Not a Proxy Solicitation
This communication is not a solicitation of a proxy from any security
holder of Concord EFS, Inc. First Data Corporation has filed a proxy
statement/prospectus with the Securities and Exchange Commission (SEC)
concerning the planned merger of Concord EFS, Inc. with a subsidiary of First
Data Corporation. WE URGE INVESTORS TO READ THE DEFINITIVE VERSION OF THE
PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH
THE SEC, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors will be
able to obtain the documents free of charge at the SEC's website,
http://www.sec.gov . In addition, documents filed with the SEC by First Data
Corporation will be available free of charge from First Data Investor
Relations, 6200 S. Quebec St., Suite 340, Greenwood Village, CO, 80111.
Documents filed with the SEC by Concord EFS, Inc. will be available free of
charge from Concord Investor Relations, 2525 Horizon Lake Drive, Suite 120,
Memphis, TN, 38133.
First Data, its directors and executive officers and other members of its
management and employees, may be deemed to be participants in the solicitation
of proxies in connection with the planned merger. Information about the
directors and executive officers of First Data and their ownership of First
Data stock is set forth in the proxy statement for First Data's 2003 annual
meeting of stockholders. Investors may obtain additional information
regarding the interests of the participants by reading the proxy
statement/prospectus.
FDC-1
FIRST DATA CORPORATION
SUMMARY FINANCIAL HIGHLIGHTS
(Unaudited)
(In millions, except per share amounts)
Three Months Ended December 31,
2003 2002 Change
Total revenues $2,243.7 $2,023.3 11%
Income before income taxes,
minority interest, equity earnings
in affiliates and discontinued
operations $530.9 $455.2 17%
Net income
Income from continuing operations $397.7 $350.8 13%
Discontinued operations (g) 3.9 1.7 129%
$401.6 $352.5 14%
Earnings per common share - diluted
Continuing operations $0.54 $0.46 17%
Discontinued operations 0.01 0.00
$0.55 $0.46 20%
Weighted average shares
outstanding - diluted 735.5 763.3 -4%
Net income margins
Continuing operations 17.7% 17.3% 0.4 pts
Discontinued operations 0.2% 0.1%
17.9% 17.4% 0.5 pts
(See accompanying notes)
FIRST DATA CORPORATION
SUMMARY FINANCIAL HIGHLIGHTS
(Unaudited)
(In millions, except per share amounts)
Twelve Months Ended December 31,
2003 2002 Change
Total revenues $8,400.2 $7,502.6 12%
Income before income taxes,
minority interest, equity
earnings in affiliates and
discontinued operations $1,838.8 $1,632.5 13%
Net income
Income from continuing
operations $1,394.0 $1,232.2 13%
Discontinued operations (g) 14.7 5.7 158%
$1,408.7 $1,237.9 14%
Earnings per common share - diluted
Continuing operations $1.86 $1.60 16%
Discontinued operations 0.02 0.01
$1.88 $1.61 17%
Weighted average shares outstanding
- diluted 749.2 771.8 -3%
Net income margins
Continuing operations 16.6% 16.4% 0.2 pts
Discontinued operations 0.2% 0.1%
16.8% 16.5% 0.3 pts
(See accompanying notes)
FIRST DATA CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In millions, except per share amounts)
Three Months Ended December 31,
2003 2002 Change
Revenues:
Transaction and processing service fees:
Payment services $867.3 $774.0 12%
Merchant services 529.8 486.4 9%
Check verification and guarantee
services 98.9 99.2 0%
Card issuing services 337.3 343.7 -2%
All other 36.2 34.9 4%
Investment income, net 38.0 19.6 94%
Professional services 28.3 32.7 -13%
Software licensing and maintenance 16.0 21.6 -26%
Product sales and other 138.5 66.1 110%
Reimbursable postage and other 153.4 145.1 6%
2,243.7 2,023.3 11%
Expenses:
Cost of services 1,108.3 988.6 12%
Cost of products sold 51.8 49.0 6%
Selling, general and administrative 365.8 335.8 9%
Reimbursable postage and other 153.4 145.1 6%
Other operating expenses:
Restructuring, net (1.0) (2.0) NM
Impairments 5.4 16.5 NM
Litigation and regulatory settlements -- 11.0 NM
1,683.7 1,544.0 9%
Operating profit 560.0 479.3 17%
Other income (expense):
Interest income 2.7 1.1 145%
Interest expense (30.4) (27.7) 10%
Investment gains and (losses) (1.4) 0.7 NM
Divestitures, net -- 1.8 NM
(29.1) (24.1) 21%
Income before income taxes, minority
interest, equity earnings in
affiliates, and discontinued operations 530.9 455.2 17%
Income taxes 130.5 109.6 19%
Minority interest (37.7) (27.7) 36%
Equity earnings in affiliates 35.0 32.9 6%
Income from continuing operations 397.7 350.8 13%
Discontinued operations: (g)
Income from discontinued operations,
net of taxes of $6.7 and $3.0,
respectively 3.9 1.7 129%
Net Income $401.6 $352.5 14%
Earnings per share from continuing
operations:
Basic $0.55 $0.47 17%
Diluted $0.54 $0.46 17%
Earnings per share:
Basic $0.55 $0.47 17%
Diluted $0.55 $0.46 20%
Weighted average shares outstanding:
Basic 726.8 751.9 -3%
Diluted 735.5 763.3 -4%
Shares outstanding at end of period 716.6 752.8 -5%
(See accompanying notes)
FIRST DATA CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In millions, except per share amounts)
Twelve Months Ended December 31,
2003 2002 Change
Revenues:
Transaction and processing service
fees:
Payment services $3,249.9 $2,829.6 15%
Merchant services 1,998.0 1,790.0 12%
Check verification and guarantee
services 389.2 375.6 4%
Card issuing services 1,325.1 1,294.0 2%
All other 144.1 155.9 -8%
Investment income, net 143.8 97.3 48%
Professional services 102.9 115.5 -11%
Software licensing and maintenance 53.4 62.9 -15%
Product sales and other 385.5 275.3 40%
Reimbursable postage and other 608.3 506.5 20%
8,400.2 7,502.6 12%
Expenses:
Cost of services 4,235.1 3,728.8 14%
Cost of products sold 204.4 189.5 8%
Selling, general and administrative 1,375.0 1,270.5 8%
Reimbursable postage and other 608.3 506.5 20%
Other operating expenses:
Restructuring, net 27.9 5.1 NM
Impairments 6.2 27.8 NM
Litigation and regulatory settlements 5.0 41.0 NM
6,461.9 5,769.2 12%
Operating profit 1,938.3 1,733.4 12%
Other income (expense):
Interest income 7.5 5.0 50%
Interest expense (107.1) (110.8) -3%
Investment gains and (losses) (6.7) 0.7 NM
Divestitures, net 6.8 4.2 NM
(99.5) (100.9) -1%
Income before income taxes, minority
interest, equity earnings in
affiliates, and discontinued
operations 1,838.8 1,632.5 13%
Income taxes 463.9 422.3 10%
Minority interest (119.6) (96.6) 24%
Equity earnings in affiliates 138.7 118.6 17%
Income from continuing operations 1,394.0 1,232.2 13%
Discontinued operations: (g)
Income from discontinued operations,
net of taxes of $17.6 and $9.9,
respectively 14.7 5.7 158%
Net Income $1,408.7 $1,237.9 14%
Earnings per share from continuing
operations:
Basic $1.89 $1.63 16%
Diluted $1.86 $1.60 16%
Earnings per share:
Basic $1.91 $1.63 17%
Diluted $1.88 $1.61 17%
Weighted average shares outstanding:
Basic 739.1 757.5 -2%
Diluted 749.2 771.8 -3%
Shares outstanding at end of period 716.6 752.8 -5%
(See accompanying notes)
FIRST DATA CORPORATION
SUMMARY SEGMENT DATA
(Unaudited)
(In millions)
Three Months Ended December 31,
2003 2002 Change
Revenues:
Payment services $972.5 $862.6 13%
Merchant services 826.0 702.7 18%
Card issuing services 518.1 523.5 -1%
Emerging payments 38.1 42.0 -9%
Subtotal segment revenues 2,354.7 2,130.8 11%
All other and corporate 21.6 22.1 -2%
2,376.3 2,152.9 10%
Adjustments for items included in
segment and all other and corporate
revenue: (a)
Equity earnings in affiliates (b) (44.0) (39.0) 13%
Interest income (2.7) (1.1) 145%
Eliminations (c) (85.9) (89.5) -4%
Consolidated revenue $2,243.7 $2,023.3 11%
Operating profit: (d)
Payment services $323.0 $286.9 13%
Merchant services 244.8 198.1 24%
Card issuing services 84.6 100.6 -16%
Emerging payments (5.7) 0.7 -914%
Subtotal segment operating profit 646.7 586.3 10%
All other and corporate (28.0) (17.0) -65%
618.7 569.3 9%
Adjustments for items included in
segment and all other and corporate
operating profit: (a)
Equity earnings in affiliates (35.0) (32.9) 6%
Minority interest from segment
operations (e) 37.9 27.7 37%
Eliminations (c) (54.5) (58.2) -6%
Interest expense (30.4) (27.7) 10%
Items excluded from segment
operations (f) (5.8) (23.0) NM
Income before income taxes, minority
interest, equity earnings in affiliates
and discontinued operations $530.9 $455.2 17%
Depreciation & Amortization:
Payment services $30.6 $27.9 10%
Merchant services 60.9 56.8 7%
Card issuing services 48.4 47.0 3%
Emerging payments 3.0 3.1 -3%
All other and corporate 4.1 5.2 -21%
Consolidated depreciation &
amortization $147.0 $140.0 5%
(See accompanying notes)
FIRST DATA CORPORATION
SUMMARY SEGMENT DATA
(Unaudited)
(In millions)
Twelve Months Ended December 31,
2003 2002 Change
Revenues:
Payment services $3,656.5 $3,181.8 15%
Merchant services 2,990.7 2,632.9 14%
Card issuing services 2,036.6 1,917.3 6%
Emerging payments 151.4 147.2 3%
Subtotal segment revenues 8,835.2 7,879.2 12%
All other and corporate 82.0 91.1 -10%
8,917.2 7,970.3 12%
Adjustments for items included in
segment and all other and corporate
revenue: (a)
Equity earnings in affiliates (b) (170.6) (143.4) 19%
Interest income (7.5) (5.0) 50%
Eliminations (c) (338.9) (319.3) 6%
Consolidated revenue $8,400.2 $7,502.6 12%
Operating profit: (d)
Payment services $1,232.2 $1,047.9 18%
Merchant services 806.7 715.7 13%
Card issuing services 305.8 372.2 -18%
Emerging payments (18.7) (16.6) -13%
Subtotal segment operating profit 2,326.0 2,119.2 10%
All other and corporate (101.6) (72.6) -40%
2,224.4 2,046.6 9%
Adjustments for items included in
segment and all other and corporate
operating profit: (a)
Equity earnings in affiliates (138.7) (118.6) 17%
Minority interest from segment
operations (e) 122.0 101.7 20%
Eliminations (c) (222.8) (217.4) 2%
Interest expense (107.1) (110.8) -3%
Items excluded from segment
operations (f) (39.0) (69.0) NM
Income before income taxes, minority
interest, equity earnings in
affiliates and discontinued
operations $1,838.8 $1,632.5 13%
Depreciation & Amortization:
Payment services $119.2 $94.4 26%
Merchant services 236.5 222.2 6%
Card issuing services 185.7 173.6 7%
Emerging payments 11.2 13.3 -16%
All other and corporate 16.7 19.7 -15%
Consolidated depreciation &
amortization $569.3 $523.2 9%
(See accompanying notes)
FIRST DATA CORPORATION
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
(a) 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.
(b) Excludes equity losses that were recorded in expense of $1.7 million
and $4.0 million for the three and twelve months ended December 31,
2003, respectively, 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 2003 and 2002.
(c) Represents elimination of adjustment to record payment services
segment revenues and operating profit on a pre-tax equivalent basis
and elimination of intersegment revenue.
(d) Segment and all other and corporate operating profit includes
interest income, minority interest from segment operations and 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 (f) below
and interest expense.
(e) Minority interest from segment operations excludes minority interest
attributable to items excluded from segment operations discussed in
note (f) below.
(f) Items, other than interest expense, excluded from segment operations
consist of the following:
2003 (in millions)
Three Twelve
months months
ended ended
Dec. 31, Dec. 31,
2003 2003
Restructuring, net $1.0 $(27.9) 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 three and twelve
months, respectively.
Impairments (5.4) (6.2) Impairment charges were
recorded for the three and
twelve months related
primarily to software in card
issuing services.
Litigation and
regulatory
settlements -- (5.0) A litigation charge of
$5.0 million was recorded in
the third quarter related to a
lawsuit associated with the
merchant services segment.
Investment losses,
net (1.4) (6.7) Net investment losses of
$1.4 million and $6.7 million
were recorded in the three and
twelve months, respectively.
These losses were primarily
related to e-commerce
businesses and strategic
investments.
Divestitures, net -- 6.8 Divestiture reserves of
$6.8 million were released in
the third quarter related to
the expiration of certain
contingencies.
(5.8) (39.0)
Minority interest 0.2 2.4
$(5.6) $(36.6)
Effect on earnings
per share $-- $(0.03)
2002 (in millions)
Three Twelve
months months
ended ended
Dec. 31, Dec. 31,
2002 2002
Restructuring, net $2.0 $(5.1) Restructuring charges of
$9.0 million recorded in the
first quarter were offset with
reversals of excess
restructuring accruals of
$1.9 million and $2.0 million
in the second and fourth
quarters, respectively.
Impairments (16.5) (27.8) Impairment charges of
$11.3 million were recorded in
the second quarter related to
SurePay's capitalized business
to business software
development costs and a
$16.5 million impairment
charge was recognized in the
fourth quarter for capitalized
contract costs related to a
Card Issuing customer.
Litigation and
regulatory
settlements (11.0) (41.0) A charge of $30.0 million was
recorded in the second quarter
related to the anticipated
settlement of various Western
Union class action lawsuits
and $11 million in regulatory
settlement charges were
recorded in the fourth quarter
relating to Western Union's
money transfer business.
Investment gains,
net 0.7 0.7 Investment losses of
$8.9 million primarily related
to e-commerce businesses were
offset by a net gain of
$9.6 million on the sale of a
portion of the Company's
investment in CheckFree
Corporation.
Divestitures, net 1.8 4.2 Net divestiture reserves of
$2.4 million and $1.8 million
were released in the second
and fourth quarters,
respectively, due to the
passage of certain contract
indemnification provisions and
amounts previously held in
escrow.
(23.0) (69.0)
Minority interest -- 5.1
$(23.0) $(63.9)
Effect on earnings
per share $(0.02) $(0.05)
(g) Discontinued operations consist of NYCE.
NM = Not meaningful.
FIRST DATA CORPORATION
FINANCIAL TRANSACTION PROCESSING
KEY INDICATORS
(Unaudited)
At December 31, 2003 2002 Change
Card accounts on file (millions) (a)
Domestic cards 316.6 298.0 6%
International cards 31.2 27.2 15%
Total 347.8 325.2 7%
For the Three-Months Ended December 31:
North America merchant dollar volume
(billions) (b) $186.4 $155.1 20%
North America merchant transactions
(millions) (b) 3,402.7 2,835.4 20%
Payment services transactions (millions):
Consumer-to-consumer money transfer (c) 22.0 18.8 17%
Branded consumer-to-business (d) 33.9 30.9 10%
For the Twelve-Months Ended December 31:
North America merchant dollar volume
(billions) (b) $664.7 $547.8 21%
North America merchant transactions
(millions) (b) 12,216.2 9,901.4 23%
Payment services transactions (millions):
Consumer-to-consumer money transfer (c) 81.0 67.8 19%
Branded consumer-to-business (d) 134.0 119.3 12%
(a) Domestic and international card accounts on file for 2002 have been
restated to reflect a reclassification from domestic to international
for accounts related to Canada and Latin America that are now
considered part of international.
(b) North America merchant dollar volume includes Visa and MasterCard
credit and off-line debit and PIN-based debit at point-of-sale.
North America merchant transactions include Visa and MasterCard
credit and off-line debit, processed-only customer transactions and
PIN-based debit at point-of-sale. For both periods, dollar volume
and transaction information exclude discontinued operations of NYCE.
(c) Consumer-to-consumer money transfer transactions include North
America and international consumer money transfer services.
(d) Branded 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. Amounts for 2002 include transactions
for E Commerce Group and Paymap as if they were consolidated
subsidiaries for the entire year to provide a more meaningful
comparison.
SOURCE First Data Corp.
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Related links:
http://www.sec.gov
CONTACT:
David Banks, Investor Relations,
+1-303-967-8057, or Staci Busby, Media Relations,
+1-303-967-7188, both of First Data Corp.
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