Magazine article American Banker

Global Payments Cites Strong Mix, Hints at a Deal

Magazine article American Banker

Global Payments Cites Strong Mix, Hints at a Deal

Article excerpt

The Atlanta transaction processor Global Payments Inc. said that the credit industry's ongoing problems had little impact on its bottom line in its fiscal third quarter, which ended Feb. 29, and that it is gearing up for an acquisition.

Paul Garcia, the company's chairman, president, and chief executive officer, said that transaction volume growth was strong, in part because of its business mix.

"We're fortunate that we have a portfolio that's made up of a lot of nondiscretionary charges - medical, education, taxation, government services - and those benefit in this kind of an economy," Mr. Garcia said last week during a conference call to discuss the results for the quarter.

Global Payments' credit and debit card transactions increased 27% in the quarter from a year earlier, and revenue from that business increased 26%.

The processing business also generated gains internationally, he said. Credit and debit volume increased only 3% in Canada, but revenue from those transactions grew 12%, "largely driven by a favorable Canadian currency exchange rate."

Joe Hyde, a Global Payments executive vice president and its chief financial officer, said that it may be close to making a purchase.

"The acquisition pipeline has never been more robust, and I'm confident we'll get some deals done," he said during the conference call. There are prospects that "make sense for our company and fulfill our mission, and I hope to deliver on all those promises in the not-too-distant future."

Global Payments also spotlighted Global Payments Asia-Pacific Ltd., its joint venture with HSBC Holdings PLC. The venture announced Tuesday a service called Pay Your Currency that lets consumers convert the currency of payments to merchants in China as they take place.

For the quarter, Global Payments' revenue rose 19%, to $310.6 million, and its net income rose 17%, to $40. …

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