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Features
Acquirer Earnings Roundup:
March 2017
Payment players reported strong quarters in terms of financial growth and operational achievements.
Earnings Summary
Quarterly Quarterly
Date of Quarterly Y/Y Operating Y/Y Net
Company Call Revenues %Δ Expenses %Δ Income Y/Y %Δ Commentary
$M $M $M
09Jan17 $817 58% $837 40% $137 37% Adjusted EPS grew 17% YOY to $.89, compared to
$.76 in Q2 2016
24Jan17 $786 22% $1,001 67% $74 (12%) FY 2016 net revenue totaled $3 billion, an increase of
22% YOY
26Jan17 $2,981 17% $2,521 18% $390 6% The number of active customer accounts grew by
5.4 million in Q4 2016
31Jan17 $2,756 10% $1,383 (1%) $940 5% Gross dollar volume grew 9% YOY (on an adjusted basis)
to $1.23 trillion
01Feb17 $502 11% $350 9% $63 (11%) Vantiv holds 19% of US merchant market share in terms
of purchase transactions
02Feb17 $4,461 25% $1,361 16% $2,100 7% US cross border payments growth reached double digits
for the first time since Q1 14
13Feb17 $2,943 (1%) $1,513 (21%) $192 N/A FY 2016 net income improved $1.9 billion YOY totaling
$420 million
22Feb17 $452 21% $181 15% ($15) N/A Gross Payment Volume (GPV) increased 34% YOY
totaling $13.7 billion for the quarter
07Mar17 $1,124 15% $518 14% $245 77% Volume increased 12% YOY to £451 billion for FY 2016
10Mar17 $42 26% $39 21% $3 793% Gateway bankcard processing volume increased 84%
YOY to $1.6 billion
Note: Acquirers’ quarterly revenues are net of interchange and assessment pass-throughs. Worldpay reports on a half year basis, their results reflect total FY 2016 earnings.
2017 Guidance
As most acquirers completed calendar year 2016, they began to EBITDA margin to expand by 84 basis points for the year, our second
look forward to 2017, providing shareholders with financial and consecutive year of such expansion. We expect this consolidated
operational expectations. adjusted EBITDA margin to again increase by approximately
Earnings Call Excerpts: 50 basis points in 2017. Clearly, our margin expansion plans are
“In summary, [First Data] set out [in] 2017 to do the following: working.” –TSYS
improve our revenue growth rate, maintain expense discipline, drive “[Vantiv] is a leader in Integrated Payments. And in 2017, we will
strong cash flow, and start to de-lever the balance sheet organically. continue to build on our lead. We will leverage our open ecosystem
We are not at all satisfied with our topline growth. ...However, even approach to reinforce Vantiv as a partner of choice for dealers
without anything close to what we consider acceptable revenue and developers. Our ability to continue to ramp new partners and
growth, we believe First Data now has a uniquely powerful cash help them deploy payment technologies is why we grow so fast, so
generation model that will allow us to pay off debt organically, as quickly.” –Vantiv
evidenced by the $1.1 billion in net debt reduction we achieved last “[CardConnect] expects a major theme in 2017 will be a significant
year.” –First Data reinvestment back into the business, specifically in product
“…All of [TSYS’s] segments hit or exceeded their revenue growth development and in strengthening our sales and marketing
goals for the quarter and year and expanded their margins on a organization.” –CardConnect
constant currency basis. Allowing for our consolidated adjusted
API Integration
In order to reach a broader range of new customers, payment players “As part of extending [Visa’s] network and enabling easier access,
are offering developer friendly API’s, therefore providing ease of we’re pushing toward open access software for our clients and
product integration. partners. We’re providing an open platform for developers to access
Earnings Call Excerpts: our APIs to quickly launch new products and experiences.” –Visa
“[CardConnect’s] go-to-market strategy continues to shift toward “…With Braintree commerce infrastructure tools, [PayPal] is
software partners that are looking for a unified payments platform creating simpler ways for merchants to offer contextual commerce
inclusive of merchant acquiring, gateway services, and secure experiences that transform the way consumers shop and pay.
device integration. We recently released Bolt, which brings the Braintree’s forward API lets merchants securely share payment
power of point to point encryption to any software application via a data with other sites and apps allowing customers to purchase from
developer friendly API. We believe Bolt positions us to significantly multiple merchants in a single convenient and secure experience. “
scale our customer base due to the ease of integration it provides –PayPal
our new customers.” –CardConnect
U.S. Headquarters Three Park Place, Suite 200 l Annapolis, Maryland 21401 European Office Keizersgracht 313-I l 1016 EE Amsterdam l The Netherlands
P: 410.855.8500 l info@firstannapolis.com P:+31 (0)20 530 0360
Acquirer Earnings Roundup- March 2017 1 of 2 © 2017 First Annapolis Consulting, Inc.
Reprinted with permission.
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