Market Snapshot
  • U.S.
  • Europe
  • Asia
Ticker Volume Price Price Delta
DJIA 16,424.85 162.29 1.00%
S&P 500 1,862.31 19.33 1.05%
NASDAQ 4,086.22 52.06 1.29%
Ticker Volume Price Price Delta
STOXX 50 3,135.83 -3.43 -0.11%
FTSE 100 6,576.15 -8.02 -0.12%
DAX 9,315.19 -2.63 -0.03%
Ticker Volume Price Price Delta
NIKKEI 14,417.53 -0.15 -0.00%
TOPIX 1,166.59 0.04 0.00%
HANG SENG 22,725.13 29.12 0.13%

MasterCard Incorporated Reports First-Quarter 2013 Financial Results



  MasterCard Incorporated Reports First-Quarter 2013 Financial Results

  * First-quarter net income of $766 million, or $6.23 per diluted share
  * First-quarter net revenue increase of 8%, to $1.9 billion
  * First-quarter gross dollar volume up 12% and purchase volume up 10%

Business Wire

PURCHASE, N.Y. -- May 01, 2013

MasterCard Incorporated (NYSE: MA) today announced financial results for the
first quarter of 2013. The company reported net income of $766 million, up
12%, and earnings per diluted share of $6.23, up 16%, in each case versus the
year-ago period.

Net revenue for the first quarter of 2013 was $1.9 billion, an 8% increase
versus the same period in 2012. Adjusted for currency, net revenue increased
9%. Net revenue growth was driven by the impact of the following:

  * A 12% increase in gross dollar volume, on a local currency basis, to $947
    billion;
  * An increase in cross-border volumes of 16%; and
  * An increase in processed transactions of 12%, to 8.7 billion.

These factors were partially offset by an increase in rebates and incentives,
primarily due to increased volumes and new and renewed agreements.

Worldwide purchase volume during the quarter was up 10% on a local currency
basis versus the first quarter of 2012, to $690 billion. As of March 31, 2013,
the company’s customers had issued 1.9 billion MasterCard and Maestro-branded
cards.

“We are pleased with our first-quarter results as we delivered solid
performance that met our expectations despite the mixed global economic
environment,” said Ajay Banga, MasterCard president and CEO. “Since the start
of the year, we have had steady momentum in new business, as well as product
innovations. We signed new consumer credit agreements with Bank of America and
TD Bank and secured significant wins in our APMEA region with Qantas, South
Africa’s NedBank, and Japan’s Rakuten. We also signed an alliance with the
Alibaba Group to explore opportunities in the Chinese market. In addition, we
advanced our mobile and digital strategy with the commercial launch of
MasterPass.”

Total operating expenses increased 6%, to $799 million, during the first
quarter of 2013 compared to the same period in 2012. The increase was
primarily driven by higher personnel expenses.

Operating income for the first quarter of 2013 increased 11% over the year-ago
period and the company delivered an operating margin of 58.1%.

MasterCard's effective tax rate was 30.5% in the first quarter of 2013, versus
a rate of 31.8% in the comparable period in 2012. The decrease was primarily
due to a more favorable geographic mix of earnings and a benefit from a
deduction related to the company’s authorization software.

During the first quarter of 2013, MasterCard repurchased approximately
1,480,000 shares of Class A common stock at a cost of approximately $766
million. Quarter-to-date through April 25, the company repurchased an
additional 341,500 shares at a cost of approximately $182 million, with $1.7
billion remaining under the current repurchase program authorization.

First-Quarter Financial Results Conference Call Details

At 9:00 a.m. ET today, the company will host a conference call to discuss its
first-quarter financial results. The dial-in information for this call is
888-771-4371 (within the U.S.) and 847-585-4405 (outside the U.S.), and the
passcode is 34404423. A replay of the call will be available for one week and
can be accessed by dialing 888-843-7419 (within the U.S.) and 630-652-3042
(outside the U.S.), and using passcode 34404423.

The live call and the replay, along with supporting materials, can also be
accessed through the Investor Relations section of the company’s website at
mastercard.com.

Non-GAAP Financial Information

The presentation of growth rates adjusted for currency represent a non-GAAP
measure and are calculated by remeasuring the prior period’s results using the
current period’s exchange rates.

About MasterCard Incorporated

MasterCard (NYSE: MA), www.mastercard.com,  is a technology company in the
global payments industry. We operate the world’s fastest payments processing
network, connecting consumers, financial institutions, merchants, governments
and businesses in more than 210 countries and territories. MasterCard’s
products and solutions make everyday commerce activities – such as shopping,
traveling, running a business and managing finances – easier, more secure and
more efficient for everyone. Follow us on Twitter @MasterCardNews, join the
discussion on the Cashless Conversations Blog and subscribe for the latest
news.

Forward-Looking Statements

Statements in this press release which are not historical facts, including
statements about MasterCard’s plans, strategies, beliefs and expectations, are
forward-looking and subject to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements speak
only as of the date they are made. Accordingly, except for the company’s
ongoing obligations under the U.S. federal securities laws, the company does
not intend to update or otherwise revise the forward-looking information to
reflect actual results of operations, changes in financial condition, changes
in estimates, expectations or assumptions, changes in general economic or
industry conditions or other circumstances arising and/or existing since the
preparation of this press release or to reflect the occurrence of any
unanticipated events. Such forward-looking statements include, without
limitation, statements related to the Company’s business prospects, including
the ability to advance its mobile and digital payments strategy through the
commercial launch of MasterPass.

Actual results may differ materially from such forward-looking statements for
a number of reasons, including those set forth in the company’s filings with
the Securities and Exchange Commission (SEC), including the company’s Annual
Report on Form 10-K for the year ended December 31, 2012, the company’s
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that have been
filed with the SEC during 2013, as well as reasons including difficulties,
delays or the inability of the company to achieve its strategic initiatives
set forth above. Factors other than those listed above could also cause the
company’s results to differ materially from expected results.

                                         
MASTERCARD INCORPORATED
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
                                           
                                          Three Months Ended
                                          March 31,
                                              2013                   2012    
                                          (in millions, except per share data)
                                                                   
Net Revenue                               $   1,906               $  1,758
Operating Expenses
General and administrative                    608                    579
Advertising and marketing                     129                    125
Depreciation and amortization                 62                     54      
     Total operating expenses                 799                    758     
Operating income                              1,107                  1,000
Other Income (Expense)
Investment income                             8                      9
Interest expense                              (5      )              (6     )
Other income (expense)                        (8      )              (3     )
     Total other income (expense)             (5      )              -       
Income before income taxes                    1,102                  1,000
Income tax expense                            336                    318     
Net Income                                $   766                 $  682     
                                                                   
Basic Earnings per Share                  $   6.25                $  5.38    
Basic Weighted-Average Shares                 123                    127     
Outstanding
Diluted Earnings per Share                $   6.23                $  5.36    
Diluted Weighted-Average Shares               123                    127     
Outstanding
                                                                   

                                                            
MASTERCARD INCORPORATED
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
                                                              
                                        March 31, 2013       December 31, 2012
                                        (in millions, except share data)
ASSETS
Cash and cash equivalents               $   1,984            $    2,052
Restricted cash for litigation              724                   726
settlement
Investment securities                       3,036                 2,951
available-for-sale, at fair value
Accounts receivable                         941                   925
Settlement due from customers               670                   1,117
Restricted security deposits held           812                   777
for customers
Prepaid expenses and other                  488                   681
current assets
Deferred income taxes                       128                   128       
Total Current Assets                        8,783                 9,357
Property, plant and equipment,              468                   472
net
Deferred income taxes                       59                    60
Goodwill                                    1,042                 1,092
Other intangible assets, net                637                   672
Other assets                                820                   809       
Total Assets                            $   11,809           $    12,462    
LIABILITIES AND EQUITY
Accounts payable                        $   262              $    357
Settlement due to customers                 624                   1,064
Restricted security deposits held           812                   777
for customers
Accrued litigation                          724                   726
Accrued expenses                            1,703                 1,748
Other current liabilities                   289                   234       
Total Current Liabilities                   4,414                 4,906
Deferred income taxes                       99                    104
Other liabilities                           540                   523       
Total Liabilities                           5,053                 5,533
Commitments and Contingencies
Stockholders’ Equity
Class A common stock, $0.0001 par
value; authorized 3,000,000,000
shares,
133,837,376 and 133,604,903                 —                     —
shares issued and 117,171,534 and
118,405,075 outstanding,
respectively
Class B common stock, $0.0001 par
value; authorized 1,200,000,000
shares,                                     —                     —
4,736,468 and 4,838,840 issued
and outstanding, respectively
Additional paid-in-capital                  3,648                 3,641
Class A treasury stock, at cost,
16,665,842 and 15,199,828 shares,           (4,902  )             (4,139   )
respectively
Retained earnings                           8,047                 7,354
Accumulated other comprehensive             (50     )             61        
income (loss)
Total Stockholders’ Equity                  6,743                 6,917
Non-controlling interests                   13                    12        
Total Equity                                6,756                 6,929     
Total Liabilities and Equity            $   11,809           $    12,462    
                                                              

                                                    
MASTERCARD INCORPORATED
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
                                                      
                                                     Three Months Ended
                                                     March 31,
                                                       2013            2012   
                                                     (in millions)
Operating Activities
Net income                                           $ 766           $ 682
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization                          62              54
Share-based payments                                   (23   )         (53   )
Deferred income taxes                                  (5    )         (14   )
Other                                                  16              8
Changes in operating assets and liabilities:
Accounts receivable                                    (25   )         7
Income taxes receivable                                149             —
Settlement due from customers                          433             (43   )
Prepaid expenses                                       (7    )         (53   )
Accounts payable                                       (93   )         (88   )
Settlement due to customers                            (423  )         (88   )
Accrued expenses                                       (30   )         1
Net change in other assets and liabilities             52              14     
Net cash provided by operating activities              872             427    
Investing Activities
Purchases of investment securities                     (934  )         (398  )
available-for-sale
Purchases of property, plant and equipment             (20   )         (12   )
Capitalized software                                   (22   )         (39   )
Proceeds from sales of investment securities           576             43
available-for-sale
Proceeds from maturities of investment                 257             111
securities available-for-sale
Proceeds from maturities of investment                 36              —
securities held-to-maturity
Investment in nonmarketable equity investments         (2    )         (7    )
Other investing activities                             2               —      
Net cash used in investing activities                  (107  )         (302  )
Financing Activities
Purchases of treasury stock                            (766  )         (248  )
Dividends paid                                         (37   )         (19   )
Tax benefit for share-based compensation               14              33
Cash proceeds from exercise of stock options           5               14
Other financing activities                             1               —      
Net cash used in financing activities                  (783  )         (220  )
Effect of exchange rate changes on cash and            (50   )         45     
cash equivalents
Net decrease in cash and cash equivalents              (68   )         (50   )
Cash and cash equivalents - beginning of               2,052           3,734  
period
Cash and cash equivalents - end of period            $ 1,984         $ 3,684  
                                                                      

                                                                                                               
MASTERCARD INCORPORATED OPERATING PERFORMANCE
                                                                                                                 
             For the 3 Months ended March 31, 2013
All                                      Purchase             Purchase   Cash               Cash
MasterCard   GDV      Growth   Growth               Growth                        Growth             Accounts   Cards
Credit,                                  Volume               Trans.     Volume             Trans.
Charge and
Debit        (Bil.)   (USD)    (Local)   (Bil.)     (Local)   (Mil.)     (Bil.)   (Local)   (Mil.)   (Mil.)     (Mil.)
Programs
APMEA        $  269   20.2 %   22.2  %   $   178    19.1  %   1,827      $  91    28.7  %   720      358        388
Canada          30    3.9  %   4.6   %       27     5.1   %   308           3     -0.2  %   6        43         52
Europe          275   13.3 %   13.0  %       191    10.2  %   2,727         84    19.9  %   494      269        284
Latin           80    10.5 %   14.7  %       48     17.7  %   1,015         32    10.6  %   181      115        134
America
Worldwide
less            653   15.2 %   16.4  %       443    14.1  %   5,878         210   21.6  %   1,400    785        859
United
States
United          294   3.7  %   3.7   %       246    4.6   %   4,363         48    -0.4  %   302      291        329
States
Worldwide       947   11.4 %   12.1  %       690    10.5  %   10,241        257   16.8  %   1,702    1,076      1,188
                                                                                                                 
MasterCard
Credit and
Charge
Programs
Worldwide
less            400   10.9 %   12.5  %       351    12.8  %   4,095         49    10.5  %   202      481        544
United
States
United          134   1.5  %   1.5   %       127    2.4   %   1,440         6     -13.7 %   6        143        178
States
Worldwide       534   8.4  %   9.6   %       479    9.8   %   5,535         55    7.1   %   208      624        722
                                                                                                                 
MasterCard
Debit
Programs
Worldwide
less            253   22.7 %   23.0  %       92     19.0  %   1,782         161   25.4  %   1,199    304        314
United
States
United          160   5.7  %   5.7   %       119    7.0   %   2,923         41    2.0   %   296      148        151
States
Worldwide       413   15.5 %   15.6  %       211    11.9  %   4,706         202   19.8  %   1,494    451        465
                                                                                                                 
             For the 3 Months ended March 31, 2012
All                                      Purchase             Purchase   Cash               Cash
MasterCard   GDV      Growth   Growth               Growth                        Growth             Accounts   Cards
Credit,                                  Volume               Trans.     Volume             Trans.
Charge and
Debit        (Bil.)   (USD)    (Local)   (Bil.)     (Local)   (Mil.)     (Bil.)   (Local)   (Mil.)   (Mil.)     (Mil.)
Programs
APMEA        $  223   25.2 %   23.7  %   $   151    23.6  %   1,551      $  72    24.0  %   525      307        333
Canada          29    8.5  %   10.2  %       26     12.2  %   290           3     -5.3  %   6        39         47
Europe          242   13.4 %   18.7  %       173    14.6  %   2,364         70    30.4  %   421      229        245
Latin           72    16.8 %   23.6  %       44     29.4  %   907           28    15.6  %   174      107        130
America
Worldwide
less            567   18.0 %   20.8  %       394    19.3  %   5,112         173   24.3  %   1,125    682        755
United
States
United          283   14.1 %   14.1  %       235    13.2  %   4,176         48    19.1  %   301      279        312
States
Worldwide       850   16.7 %   18.5  %       629    16.9  %   9,289         221   23.2  %   1,425    961        1,067
                                                                                                                 
MasterCard
Credit and
Charge
Programs
Worldwide
less            361   16.0 %   17.9  %       317    19.0  %   3,702         44    10.7  %   181      451        512
United
States
United          132   7.4  %   7.4   %       124    8.2   %   1,458         7     -4.6  %   7        147        176
States
Worldwide       493   13.6 %   14.9  %       441    15.7  %   5,160         52    8.2   %   187      598        688
                                                                                                                 
MasterCard
Debit
Programs
Worldwide
less            206   21.6 %   26.1  %       77     20.4  %   1,410         129   29.8  %   944      231        243
United
States
United          152   20.7 %   20.7  %       111    19.3  %   2,719         41    24.7  %   294      132        135
States
Worldwide       358   21.2 %   23.8  %       188    19.8  %   4,128         170   28.6  %   1,238    362        379
                                                                                                                 
APMEA = Asia Pacific / Middle East / Africa
Note that the figures in the preceding tables may not sum due to rounding; growth represents change from the
comparable year-ago period
              

Footnote

The tables set forth the gross dollar volume (“GDV”), purchase volume, cash
volume and the number of purchase transactions, cash transactions, accounts
and cards on a regional and global basis for MasterCard®-branded and
MasterCard Electronic™-branded cards. Growth rates over prior periods are
provided for volume-based data.

Debit transactions on Maestro® and Cirrus®-branded cards, Mondex® transactions
and transactions involving brands other than MasterCard are not included in
the preceding tables.

For purposes of the table: GDV represents purchase volume plus cash volume and
includes the impact of balance transfers and convenience checks; “purchase
volume” means the aggregate dollar amount of purchases made with
MasterCard-branded cards for the relevant period; and “cash volume” means the
aggregate dollar amount of cash disbursements obtained with MasterCard-branded
cards for the relevant period. The number of cards includes virtual cards,
which are MasterCard-branded payment accounts that do not generally have
physical cards associated with them.

The MasterCard payment product is comprised of credit, charge and debit
programs, and data relating to each type of program is included in the tables.
Debit programs include MasterCard-branded debit programs where the primary
means of cardholder validation at the point of sale is for cardholders either
to sign a sales receipt  or enter a PIN. The tables include information with
respect to transactions involving MasterCard-branded cards that are not
processed by MasterCard and transactions for which MasterCard does not earn
significant revenues.

Information denominated in U.S. dollars is calculated by applying an
established U.S. dollar/local currency exchange rate for each local currency
in which MasterCard volumes are reported. These exchange rates are calculated
on a quarterly basis using the average exchange rate for each quarter.
MasterCard reports period-over-period rates of change in purchase volume and
cash volume on the basis of local currency information, in order to eliminate
the impact of changes in the value of foreign currencies against the U.S.
dollar in calculating such rates of change.

The data set forth in the GDV, purchase volume, purchase transactions, cash
volume and cash transactions columns is provided by MasterCard customers and
is subject to verification by MasterCard and partial cross-checking against
information provided by MasterCard’s transaction processing systems. The data
set forth in the accounts and cards columns is provided by MasterCard
customers and is subject to certain limited verification by MasterCard. A
portion of the data set forth in the accounts and cards columns reflects the
impact of routine portfolio changes among customers and other practices that
may lead to over counting of the underlying data in certain circumstances. All
data is subject to revision and amendment by MasterCard’s customers subsequent
to the date of its release.

In 2012, certain MasterCard Debit and Credit Programs in the Europe region
have changed due to a reclassification of programs. There is no impact at the
All MasterCard Programs level. In addition, Purchase Transactions for certain
Credit Programs in the Latin America region have been revised due to changes
from several customers. MasterCard revenue is not impacted from these changes.
Data for the comparable periods in 2012, 2011 and 2010 have been revised to be
consistent with these approaches.

Performance information for prior periods can be found in the "Investor
Relations" section of MasterCard's website at www.mastercard.com.

Contact:

MasterCard
Investor Relations:
Barbara Gasper, 914-249-4565
investor_relations@mastercard.com
or
Media Relations:
Jim Issokson, 914-249-6286
james_issokson@mastercard.com
Sponsored Links
Advertisement
Advertisements
Sponsored Links
Advertisement