First Data Corp. has delivered another strong quarter, with earnings per share (EPS) from continuing operations of $0.54. Comparable third quarter 2003 EPS from continuing operations were $0.48. Revenue grew 21% to $2.5 billion. Net cash provided by operating activities for the quarter was $750 million.
“The point-of-sale activity for Western Union money transfers and merchant transactions continues to be the major contributor to our strong operating performance,” says Charlie Fote, chairman and chief executive officer. “We continue to be pleased with the addition of Concord to the First Data family. Its performance is helping drive First Data results. Additionally, we will achieve our $30 million in synergy savings related to the Concord integration for this year.”
Third quarter 2004 results included $0.03 of charges, which were comprised of integration expenses and other charges that impacted EPS by $0.02 and $0.01, respectively.
Significant company news in the quarter included Washington Mutual, Inc.’s extension of its relationship with the STAR(R) Network and the announcement of Bank of America's intent to extend and expand its relationship across all segments of First Data.
The Western Union money transfer business had another outstanding quarter posting revenue growth of 13% to $861 million, with profits up 16% to $296 million.
A significant milestone in the quarter was the opening of the 200,000th money transfer location. This far-reaching global network supported strong consumer demand, which yielded consumer-to-consumer transaction growth of 18%, led by international growth of 23% and Mexico growth of 14%.
Overall, the Payment Services segment delivered in-line results growing revenue 10% to $1.0 billion and delivered operating profit of $332 million. Operating margin remained strong at 33%, led by Western Union.
Merchant Services' results were driven by 65% transaction growth. Revenue was $983 million, up 47%, and operating profit of $248 million grew 37%. Segment margin remained healthy at 25%.
Card Issuing Services’ revenue and operating profit were $620 million and $154 million, respectively. The Card team's focus on smooth conversions has brought the total new accounts converted for the year to 51 million. The total pipeline stands at approximately 50 million accounts, of which more than 40 million are scheduled to be converted by the end of the first quarter 2005.
During the quarter, the company repurchased 28.4 million shares of stock for $1.2 billion at an average price of $42.34 per share. Yesterday, the board approved an additional $1.5 billion in new authorization bringing the company's current authorization for stock repurchases to nearly $2 billion.