Global Payments : Reports First Quarter Earnings, Increases Annual Fiscal 2016 Outlook and Declares Two-for-One Stock Split

Global Payments Inc. (NYSE: GPN) today announced results for its fiscal first quarter ended August 31, 2015.

“We are delighted with our outstanding first quarter results, which represent an excellent start to the 2016 fiscal year and a continuation of exceeding our expectations across our markets,” said Jeff Sloan, Chief Executive Officer. “This performance builds on the momentum we have generated as we continue to invest in our strategy to expand distribution and create competitive differentiation through technology by delivering innovative solutions globally.”

First Quarter Fiscal 2016 Summary

• Adjusted net revenue grew 8% to $537.0 million, compared to $495.2 million in the first quarter of fiscal 2015.
• Cash diluted earnings per share grew 25% to $1.57, compared to $1.26 in the first quarter of fiscal 2015.
• Cash operating margin expanded to 30.5%, a 150 basis point increase over the first quarter of fiscal 2015.
• GAAP revenues grew 6% to $748.8 million, compared to $704.9 million in the first quarter of fiscal 2015, and diluted earnings per share were $1.32, compared to $1.10 in the prior year.

Fiscal 2016 Outlook

“As a result of our strong first quarter performance, we are increasing our outlook for annual fiscal 2016 diluted earnings per share on a cash basis to a range of $5.77 to $5.92, reflecting growth of 14% to 17% over fiscal 2015,” stated Cameron Bready, Executive Vice President and Chief Financial Officer. “We also now expect annual fiscal 2016 core cash operating margins to expand by as much as 50 basis points on a constant currency basis. We continue to expect adjusted net revenues to range from $2.06 billion to $2.10 billion, or growth of 6% to 8% over fiscal 2015.”

Stock Split and Dividend

Global Payments’ Board of Directors has declared a two-for-one stock split of the company’s common stock to be effected in the form of a stock dividend of one additional share of common stock for each outstanding share of common stock. The stock dividend will be payable on November 2, 2015 to all shareholders of record as of October 21, 2015.

A first quarter dividend of $0.01 per share, after giving effect to the two-for-one stock split, will be payable on November 27, 2015 to shareholders of record as of November 13, 2015.

Conference Call

Global Payments’ management will host a conference call today, October 7, 2015 at 8:00 a.m. ET to discuss financial results and business highlights. Callers may access the conference call via the investor relations page of the company’s website at www.globalpaymentsinc.com; or callers in North America may dial 877-674-6428 and callers outside North America may dial 970-315-0457. A replay of the call will be archived on the company's website within two hours of the live call.

Non-GAAP Financial Measures

Global Payments supplemented revenues, income and earnings per share information determined in accordance with GAAP by providing income and related earnings per share on a "cash earnings" basis and adjusted net revenue in this earnings release to assist with evaluating performance. In addition to GAAP measures, management uses these non-GAAP measures to focus on the factors the company believes are pertinent to the daily management of our operations.

Reconciliations of the non-GAAP measures to the most directly comparable GAAP measure are included in the schedules to this release.

About Global Payments

Global Payments Inc. (NYSE: GPN) is a leading worldwide provider of payment technology services that delivers innovative solutions driven by customer needs globally. Our technologies, partnerships and employee expertise enable us to provide a broad range of products and services that allow our customers to accept all payment types across a variety of distribution channels in many markets around the world.

Headquartered in Atlanta, Georgia with approximately 4,500 employees worldwide, Global Payments is a Fortune 1000 Company with merchants and partners in 29 countries throughout North America, Europe, the Asia-Pacific region and Brazil. For more information about Global Payments, our Service. Driven. Commerce brand and our technologies, please visit www.globalpaymentsinc.com.

_________________________

This announcement and comments made by Global Payments' management during the conference call may contain certain forward-looking statements within the meaning of the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including revenue and earnings estimates and management’s expectations regarding future events and developments, are forward-looking statements and are subject to significant risks and uncertainties. Important factors that may cause actual events or results to differ materially from those anticipated by such forward-looking statements include our potential failure to safeguard our data; our ability to maintain Visa and MasterCard registration and financial institution sponsorship; our reliance on financial institutions to provide clearing services in connection with our settlement activities; our potential failure to comply with card network requirements; increased merchant, referral partner or ISO attrition; our ability to increase our share of existing markets and expand into new markets; political, economic and regulatory changes in the foreign countries in which we operate; system interruptions in service; increases in credit card network fees; future performance, integration and conversion of acquired operations; and other risk factors presented in our most recent Annual Report on Form 10-K and any subsequent SEC filings, which we advise you to review. We undertake no obligation to revise any of these statements to reflect future circumstances or the occurrence of unanticipated events.

See Schedule 6 for a reconciliation of adjusted net revenue and cash earnings to GAAP.

See "Non-GAAP Financial Measures" discussion on Schedule 8.

See Schedule 7 for reconciliation of adjusted net revenue and cash earnings segment information to GAAP.

See "Non-GAAP Financial Measures" discussion on Schedule 8.

¹ Represents adjustments to revenues for gross-up related payments (included in operating expenses) associated with certain wholesale lines of business to reflect economic benefits to the Company.

² Represents adjustments to exclude acquisition-related amortization expense, share-based compensation expense and the related income tax benefits of each.

³ For the three months ended August 31, 2015, represents recoveries associated with a U.K. vendor outage and the related provision for income taxes. For the three months ended August 31, 2014, represents a gain on sale of a component of our Russia business that leased ATMs to our sponsor bank in Russia and the related provision for income taxes.

See "Non-GAAP Financial Measures" discussion on Schedule 8.

¹ Represents adjustments to revenues for gross-up related payments (included in operating expenses) associated with certain wholesale lines of business to reflect economic benefits to the Company.

² Represents adjustments to exclude acquisition-related amortization expense and share-based compensation expense.

³ For the three months ended August 31, 2015, represents recoveries associated with a U.K. vendor outage. For the three months ended August 31, 2014, represents a gain on sale of a component of our Russia business that leased ATMs to our sponsor bank in Russia.

See "Non-GAAP Financial Measures" discussion on Schedule 8.

¹ Represents adjustments to revenues for gross-up related payments (included in operating expenses) associated with certain wholesale lines of business to reflect economic benefits to the Company and, in fiscal 2015, a revenue adjustment for select U.K. customer payments related to a vendor outage.

² Fiscal 2015 reflects acquisition-related amortization expense of $0.67, share-based compensation expense of $0.19 and non-recurring items of $0.06, including a revenue adjustment for select U.K. customer payments related to a vendor outage and expense adjustments for charges related to employee termination benefits, non-cash losses from the retirement of property and equipment, a transaction-related tax associated with the acquisition of Realex, certain business tax assessments in the U.S. for prior periods, a gain on the sale of our Russia ATM business, reversal of previously recorded interest expense associated with a previously uncertain tax position and the related income tax effects of each.

NON-GAAP FINANCIAL MEASURES

Global Payments supplemented revenues, income and earnings per share information determined in accordance with GAAP by providing income and related earnings per share on a "cash earnings" basis and Adjusted Net Revenue in this earnings release to assist with evaluating performance. In addition to GAAP measures, management uses these non-GAAP measures to focus on the factors we believe are pertinent to the daily management of our operations. Management believes Adjusted Net Revenue more closely reflects the economic benefits to the Company's core business and allows for better comparisons with industry peers. Management uses these non-GAAP metrics, together with other metrics, to set goals for and measure the performance of its business and to determine incentive compensation. Our Adjusted Net Revenue and income and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, revenues, income and earnings per share determined in accordance with GAAP. Our measures of Adjusted Net Revenue, income and earnings per share on a cash earnings basis reflect management's judgment of particular items, and may not be comparable to similarly titled measures reported by other companies.

Adjusted Net Revenue excludes gross-up related payments associated with certain wholesale lines of business to reflect economic benefits to the Company. On a GAAP basis, these payments are presented gross in both revenues and operating expenses.

Income and the related earnings per share on a cash earnings basis exclude acquisition-related amortization expense, share-based compensation and certain other items specific to each reporting period as more fully described in the accompanying reconciliations in Schedule 6, Schedule 7 and Schedule 9. The tax rate used in determining the net income impact of cash earnings adjustments is either the jurisdictional statutory rate in effect at the time of the adjustment or the jurisdictional expected annual effective tax rate for the period, depending on the nature and timing of the adjustment.

¹Represents adjustments to revenues for gross-up related payments (included in operating expenses) associated with certain wholesale lines of business to reflect economic benefits to the Company.

²Represents adjustments to exclude acquisition-related amortization expense, stock compensation expense and the related income tax benefits of each.

³Represents a gain on the sale of a component of our Russia business that leased ATMs to our sponsor bank in Russia.

⁴The revenue adjustment represents select U.K. customer payments related to a vendor outage and the expense adjustment represents certain business tax assessments in the U.S. for prior periods.

⁵The adjustments represent charges related to employee termination benefits, non-cash losses from the retirement of property and equipment, a transaction-related tax associated with our acquisition of Realex, reversal of previously recorded interest expense associated with a previously uncertain tax position and the related income tax effects of each.

See "Non-GAAP Financial Measures" discussion on Schedule 8.

View source version on businesswire.com: http://www.businesswire.com/news/home/20151007005455/en/