Global Payments Inc. (GPN, Financial) filed Quarterly Report for the period ended 2012-02-29.
Global Payments has a market cap of $3.72 billion; its shares were traded at around $47.5 with a P/E ratio of 15.18 and P/S ratio of 2. The dividend yield of Global Payments stocks is 0.17%. Global Payments had an annual average earning growth of 15.9% over the past 10 years. GuruFocus rated Global Payments the business predictability rank of 4-star.
For the three months ended February 29, 2012, revenue from our North America merchant services segment increased 15% to $378.8 million compared to the prior year s comparable period. For the nine months ended February 29, 2012, revenue from our North America merchant services segment increased 14% to $1,136.4 million compared to the prior year s comparable period. North America revenue growth was driven by our U.S. ISO channel, reduced interchange expenses due to legislation as explained below, strong growth from our gaming business and solid performance from our direct sales channel.
We grow our United States revenue by adding small and mid-market merchants in diversified vertical markets, primarily through our ISO channel. For the three and nine months ended February 29, 2012, our United States direct credit and debit card processed transactions grew 12% and 13%, respectively, compared to the prior year period. Increased spreads, primarily driven by the Durbin amendment, have offset the impact of lower average ticket, which decreased by 6% and 4% for the three and nine months ended February 29, 2012, respectively. This decline in average ticket is primarily due to a shift toward smaller merchants added through our ISO channel. Smaller merchants tend to have lower average tickets than larger merchants. The effect of consumers replacing cash-based payments with debit card transactions also lowers our overall average ticket amounts. Based on our mix of merchants, slightly more than half of our United States transactions are comprised of a combination of signature- and PIN-based debit transactions, with PIN-based debit transactions representing less than 10% of our total transactions.
Our Europe merchant services revenue for the three months ended February 29, 2012 increased 28% to $116.2 million compared to the prior year period. Our Europe merchant services revenue for the nine months ended February 29, 2012 increased 48% to $360.8 million compared to the prior year period. These revenue increases were driven primarily by the impact of our acquisition in Spain on December 20, 2010, pricing benefits in the United Kingdom and favorable foreign currency trends during the nine months ended February 29, 2012.
Sales, general and administrative expenses increased 18% for the three months and nine months ended February 29, 2012 compared to the prior year s comparable period. This increase is primarily due to an increase in commission payments to ISOs. As a percentage of revenue, sales, general and administrative expense remained relatively flat at 46.3% for the three months ended February 29, 2012 compared to 46.0% in the prior year s comparable period. As a percentage of revenue, sales, general and administrative expense decreased to 45.9% for the nine months ended February 29, 2012 compared to 46.5% in the prior year s comparable period. This decrease is due to increasing revenues due to pricing changes in the United Kingdom which did not have proportional increases in sales, general and administrative expenses.
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Global Payments has a market cap of $3.72 billion; its shares were traded at around $47.5 with a P/E ratio of 15.18 and P/S ratio of 2. The dividend yield of Global Payments stocks is 0.17%. Global Payments had an annual average earning growth of 15.9% over the past 10 years. GuruFocus rated Global Payments the business predictability rank of 4-star.
Highlight of Business Operations:
For the three months ended February 29, 2012, revenues increased 17% to $533.5 million compared to the prior year s comparable period. For the nine months ended February 29, 2012, revenues increased 20% to $1,606.8 million compared to the prior year s comparable period primarily due to strong performance across certain of our regions, and the impact of our acquisition in Spain on December 20, 2010For the three months ended February 29, 2012, revenue from our North America merchant services segment increased 15% to $378.8 million compared to the prior year s comparable period. For the nine months ended February 29, 2012, revenue from our North America merchant services segment increased 14% to $1,136.4 million compared to the prior year s comparable period. North America revenue growth was driven by our U.S. ISO channel, reduced interchange expenses due to legislation as explained below, strong growth from our gaming business and solid performance from our direct sales channel.
We grow our United States revenue by adding small and mid-market merchants in diversified vertical markets, primarily through our ISO channel. For the three and nine months ended February 29, 2012, our United States direct credit and debit card processed transactions grew 12% and 13%, respectively, compared to the prior year period. Increased spreads, primarily driven by the Durbin amendment, have offset the impact of lower average ticket, which decreased by 6% and 4% for the three and nine months ended February 29, 2012, respectively. This decline in average ticket is primarily due to a shift toward smaller merchants added through our ISO channel. Smaller merchants tend to have lower average tickets than larger merchants. The effect of consumers replacing cash-based payments with debit card transactions also lowers our overall average ticket amounts. Based on our mix of merchants, slightly more than half of our United States transactions are comprised of a combination of signature- and PIN-based debit transactions, with PIN-based debit transactions representing less than 10% of our total transactions.
Our Europe merchant services revenue for the three months ended February 29, 2012 increased 28% to $116.2 million compared to the prior year period. Our Europe merchant services revenue for the nine months ended February 29, 2012 increased 48% to $360.8 million compared to the prior year period. These revenue increases were driven primarily by the impact of our acquisition in Spain on December 20, 2010, pricing benefits in the United Kingdom and favorable foreign currency trends during the nine months ended February 29, 2012.
Sales, general and administrative expenses increased 18% for the three months and nine months ended February 29, 2012 compared to the prior year s comparable period. This increase is primarily due to an increase in commission payments to ISOs. As a percentage of revenue, sales, general and administrative expense remained relatively flat at 46.3% for the three months ended February 29, 2012 compared to 46.0% in the prior year s comparable period. As a percentage of revenue, sales, general and administrative expense decreased to 45.9% for the nine months ended February 29, 2012 compared to 46.5% in the prior year s comparable period. This decrease is due to increasing revenues due to pricing changes in the United Kingdom which did not have proportional increases in sales, general and administrative expenses.
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