First Data Reports 2004 EPS From Continuing Operations of $2.22 on Revenue Growth of 19%

Thursday 27 January 2005 00:19 CET | News

First Data Corp. reported fourth quarter EPS of $0.56. Results included integration expenses of $0.03, and the quarter also included other charges of $0.01.

The high quality of First Datas 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 companys 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. 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 Concords 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 Boards Statement No. 123R. The expense upon adoption will be affected primarily by the companys adoption date, historical options, new option grants, forfeitures and the valuation methodology selected going forward.

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Categories: Payments & Commerce | Payments General
Countries: World
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