First Data Q3 profit falls

Source: First Data

First Data Corp. (NYSE:FDC) today reported its financial results for the third quarter of 2005.

Consolidated revenue for the quarter was $2.7 billion. Net income for the quarter was $422 million, or $0.54 per share on a GAAP basis. Cash flow from operating activities for the quarter was $796 million, and $1.7 billion year-to-date.

Earnings per share included $0.07 of items, half of which related to Concord integration expenses, with the remainder related to the Encorus mobile payments business. Results for the quarter also included a $0.01 gain related to the sale of the company's remaining interest in International Banking Technologies, and other items.

Commenting on the results, Charlie Fote, chairman and chief executive officer, said: "We are very encouraged by our results this quarter. Our results reflect the second half performance improvements in our Payments and Merchant businesses that we had anticipated. Western Union consumer-to-consumer transaction growth of 22% led to excellent Payments segment results. Transaction growth of 13% and solid international performance contributed to strong growth in the Merchant segment. At the same time, we continue to take steps to improve the performance of our Card business."

In the third quarter, 6.1 million shares were repurchased for $251 million at an average price of $41.45, leaving an authorized $1.3 billion in the company's buyback program.

Commenting on the outlook, Fote continued, "Third quarter growth, coupled with our recent business wins, including the combination of the Chase and Paymentech alliances, the new Citibank alliance and international acquisitions, put us on solid footing as we move into 2006."

Third Quarter Segment Results

Payment Services reported revenue of $1.1 billion, a 12% increase, and operating profit of $361 million, up 8%.

Western Union money transfer, representing 86% of Payment Services' revenue, delivered outstanding performance in the third quarter, driven by strong consumer-to-consumer transaction growth of 22%. Money transfer revenue increased 14%, with an operating profit margin of 35%. Money transfer operating profit increased 16% in the third quarter.

Merchant Services reported revenue of $1.1 billion, up 8%. Operating profit was $266 million, up 7%. Margin for the quarter was 25%. Transaction growth was up 13%.

Card Issuing Services reported revenue of $594 million and operating profit of $116 million, down 4% and 25% respectively. Margin for the quarter was 20%.Download the document now 53.5 kb (Adobe Acrobat Document)

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