Global Payments (NYSE: GPN) today announced results for its first quarter ended August 31, 2007.
For the first quarter, revenue grew 19% to $311.0 million compared to $260.3 million in the prior year. Excluding the impact of current period restructuring charges, diluted earnings per share grew 6% to $0.54 compared to $0.51 in the prior year quarter.
In accordance with GAAP, the current quarter includes restructuring charges (see attached reconciliation schedule) relating to an operating center consolidation announced in March 2007. These charges are reflected in our GAAP diluted earnings per share amounts. For the three months ended August 31, 2007, GAAP diluted earnings per share was $0.53 compared to $0.51 in the prior year period.
During the current quarter, Global Payments completed $67.9 million in open market repurchases of 1.8 million shares at an average price of $37.27 per share, including commissions paid. As of August 31, 2007, the company had $32.1 million remaining under its current share repurchase authorization.
Comments and Outlook
Chairman, President and CEO, Paul R. Garcia, stated, "We are pleased with our fiscal 2008 first quarter results, which were driven by growth in our merchant services segment. Our revenue growth was primarily driven by continued organic expansion in our domestic ISO channel, as well as the favorable impact from our July 2006 addition of our Asia-Pacific joint venture with HSBC. In addition, our Canadian merchant services channel benefited from a favorable Canadian currency exchange rate. Lastly, our money transfer segment met our expectations for the quarter, and our corporate expenses declined compared to the prior year due to lower equity compensation costs."
Comments and Outlook
"Based on these results and trends, we are providing annual fiscal 2008 revenue guidance of $1,195 million to $1,247 million. This revenue guidance reflects an expected 13% to 17% growth versus $1,061.5 million in fiscal 2007. In addition, we are providing annual fiscal 2008 diluted earnings per share guidance of $1.87 to $1.96, or 6 percent to 11 percent growth versus $1.77 in fiscal 2007.(1) This includes the impact of stock option expenses as a result of our June 1, 2006 adoption of FAS 123R. Our guidance excludes the impact of future significant acquisitions, and these earnings per share ranges exclude the impact of potential restructuring and other charges," said Garcia.
(1) Fiscal 2007 diluted earnings per share was $1.75 on a GAAP basis, which includes restructuring and other charges equivalent to $0.02 in diluted earnings per share.
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