Upcoming AWS Coverage on Priceline Group

LONDON, UK / ACCESSWIRE / January 12, 2017 / Active Wall St. announces its post-earnings coverage on Global Payments Inc. (NYSE: GPN). The Company disclosed its fiscal 2017 second quarter results on January 09, 2017. Global Payments, which acquired Heartland Payment Systems, Inc. in a cash-and-stock transaction for approximately $4.3 billion in December 2015, stated that it is delighted with the progress of its integration efforts. According to the Company, these efforts have allowed the company to integrate the business faster than expected and accelerate expense synergies. As a result, Global Payments now expects total annual run rate expense synergies from the transaction to be approximately $135 million, an increase of $10 million compared to its prior target. Register with us now for your free membership at: http://www.activewallst.com/register/.

One of Global Payments' competitors within the Business Services space, The Priceline Group Inc. (NASDAQ: PCLN), is estimated to report earnings on February 15, 2017. AWS will be initiating a research report on Priceline Group following the release of its earnings results.

Today, AWS is promoting its earnings coverage on GPN; touching on PCLN. Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=GPN

http://www.activewallst.com/registration-3/?symbol=PCLN

Earnings Reviewed

For the three months ended November 30, 2016, Global Payments' GAAP revenues were $941.8 million compared to $722.4 million in Q2 FY16. The Company's adjusted net revenue grew 58% to $817.2 million in the reported quarter, compared to $518.3 million in the year earlier quarter. On a constant currency basis, adjusted net revenue grew 61% on a y-o-y basis. The electronics payment processing Company's revenue numbers outperformed market estimates of $803.4 million.

For Q2 FY17, Global Payments reported operating margin of 11.2% compared to 17.1% in Q2 FY16. The Company's adjusted operating margin was 29.5%. On a constant currency basis, adjusted operating margin was 30.0%, a 50 basis point increase over the year ago same period.

During Q2 FY17, Global payments posted net income of $49.45 million, or diluted earnings per share of $0.32, compared to net income of $78.77 million, or $0.60 diluted earnings per share, in the prior year. Adjusted earnings per share grew 17% to $0.89 compared to $0.76 in Q2 FY16. On a constant currency basis, adjusted earnings per share grew 22%. The result surpassed Wall Street's expectations for adjusted earnings of $0.84 per share.

Segment Results

During Q2 FY17, Global Payment's North America segment net revenue grew by 85% compared to Q2 FY16, while the segment's operating margin expanded 150 basis points despite the inclusion of Heartland, which has a lower margin profile relative to Global Payments historical levels.

During the reported quarter, the Company's European business delivered 18% net revenue growth on a local currency basis. Reported net revenue growth for Europe was 6% compared to the prior year due to significantly unfavorable foreign currency exchange rates, particularly the pound, which declined nearly 20% y-o-y. European operating margin of 46.7% declined from the year earlier quarter, due primarily to integration costs associated with the URSA transaction and the impacts of foreign currency.

For Q2 FY17, Global Payments Asia/Pacific segment reported 24% net revenue growth and operating margins of 29.6%, an increase of over 200 basis points y-o-y. Growth in Asia/Pacific was primarily driven by mid-teens organic growth in the region as well as the addition of eWAY.

Balance Sheet

Excluding Heartland integration costs, Global payments generated free cash flow of approximately $170 million in Q2 FY17. The Company's capital expenditures totaled $42 million for the reported quarter. The Company stated that since the date of its last earnings call, it has reduced outstanding debt by approximately $50 million and repurchased 1.5 million shares for $105 million. In October 2016, Global Payments refinanced its existing debt facilities, increasing the aggregate Term Loan A facilities by $750 million with the proceeds being used to reduce a portion of the Term Loan B facility and outstanding revolving credit facility borrowings.

Global Payments' Board of Directors approved a quarterly dividend of $0.01 per share payable February 24, 2017, to shareholders of record as of February 10, 2017. The board also approved an increase to the existing authorization for the Company's share repurchase program, raising the total available authorization to $300 million.

Outlook

Global Payments changed its fiscal year end to December 31, with the Company's first fiscal year on a calendar-year basis starting on January 01, 2017. For calendar 2017, Global Payments expects reported adjusted net revenue to be between $3.35 billion to $3.45 billion, representing an estimated growth of 18% to 21% over calendar 2016 estimates. The Company further expects reported adjusted earnings per share of $3.70 to $3.90, which represents estimated growth of 16% to 23% over its calendar 2016 estimate. Calendar 2017 adjusted earnings per share expectations represent annualized growth of approximately 17% relative to the Company's last FY17 guidance.

Stock Performance

On Wednesday, the stock closed the trading session at $78.23, slightly rising 0.45% from its previous closing price of $77.88. A total volume of 1.33 million shares have exchanged hands, which was higher than the 3-month average volume of 1.24 million shares. Global Payments' stock price advanced 8.37% in the last month, 3.40% in the past six months, and 33.76% in the previous twelve months. Moreover, the stock gained 12.71% since the start of the year. The Company's shares are trading at a PE ratio of 40.14 and have a dividend yield of 0.05%.

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SOURCE: Active Wall Street