Delivers Record Results for Third Quarter
Reaffirms Constant Currency Outlook (Excluding Dispositions)
Receives HSR Clearance for EVO Payments Acquisition and Netspend Consumer Divestiture
ATLANTA–(BUSINESS WIRE)–#earnings–Global Payments Inc. (NYSE: GPN) today announced results for the third quarter ended September 30, 2022.
“We delivered record results in the third quarter consistent with our raised cycle guidance (on a constant currency basis and excluding dispositions), highlighting the resiliency of our business model and our ongoing track record of execution across market cycles,” said Jeff Sloan, Chief Executive Officer. “Importantly, our Merchant business delivered strong 11% adjusted net revenue growth (ex Russia) and our Issuer business delivered 6% adjusted net revenue growth, each on a foreign exchange neutral basis relative to the prior year period. Our core Issuer business continued to accelerate sequentially versus Q2 2022.
“We achieved these results while making substantial progress on our strategic and financing initiatives during the period. We received Hart-Scott-Rodino clearance in the United States for our acquisition of EVO Payments and divestiture of Netspend’s consumer business, and we have now made regulatory filings in all jurisdictions, foreign and domestic, contemplated by the transactions.”
Sloan continued, “We took steps to finance the EVO transaction with a $2.5 billion debt capital raise in August at attractive rates, and we completed a successful long-term extension and enhancement of our revolving credit facility. We also closed on our $1.5 billion strategic investment with Silver Lake and associated transactions.”
Sloan concluded, “These transactions will serve to accelerate our strategy and provide us with enhanced confidence in our growth and margin targets over the cycle. Upon closing, Merchant Solutions will represent approximately 75% of our adjusted net revenue with Issuer Solutions, including B2B, comprising roughly 25%. We have multiple levers in each segment to continue to gain share over the cycle and a simpler model more geared toward our core customers with enhanced growth and margin prospects.”
Third Quarter 2022 Summary
- GAAP revenues were $2.29 billion, compared to $2.20 billion in the third quarter of 2021; diluted earnings per share were $1.05 compared to $1.01 in the prior year; and operating margin was 16.9% compared to 18.2% in the prior year.
- Adjusted net revenues increased 3% (6% constant currency) to $2.06 billion, compared to $2.00 billion in the third quarter of 2021; excluding the impact of exiting Russia and the Netspend consumer assets, classified as held for sale, adjusted net revenue increased 9% on a constant currency basis.
- Adjusted earnings per share increased 14% (18% constant currency) to $2.48, compared to $2.18 in the third quarter of 2021.
- Adjusted operating margin expanded 240 basis points to 45.2%.
2022 Outlook
“We are pleased with our strong financial performance in the third quarter, which was consistent with our expectations despite ongoing macro headwinds,” said Josh Whipple, Senior Executive Vice President and Chief Financial Officer. “On a constant currency basis, we achieved high-single-digit adjusted net revenue growth excluding the impact of exiting Russia and the Netspend consumer assets, expanded adjusted operating margins meaningfully and delivered high-teens adjusted earnings per share growth driven by consistent execution of our technology-enabled strategy.
“For 2022, we continue to expect constant currency adjusted net revenue growth of 10% to 11% over 2021, excluding dispositions. Further, we continue to expect adjusted earnings per share on a constant currency basis to be in a range of $9.53 to $9.75, reflecting growth of 17% to 20% over 2021. We also now expect adjusted operating margin expansion of up to 170 basis points, an increase from our prior outlook of up to 150 basis points.
“Our 2022 outlook presumes continuing recovery from the pandemic worldwide and a stable global macroeconomic environment throughout the remainder of this calendar year.”
Whipple concluded, “We continue to expect the acquisition of EVO and the disposition of Netspend’s consumer business to close in the first quarter of 2023, subject to receipt of regulatory approvals and satisfaction of customary closing conditions.”
Capital Allocation
Global Payments’ Board of Directors approved a dividend of $0.25 per share payable December 30, 2022 to shareholders of record as of December 16, 2022. Our Board of Directors has also reauthorized up to $1.5 billion of share repurchase capacity.
Conference Call
Global Payments’ management will host a live audio webcast today, October 31, 2022, at 8:00 a.m. EDT to discuss financial results and business highlights. The audio webcast, along with supplemental financial information, can be accessed via the investor relations page of the company’s website at investors.globalpayments.com. A replay of the audio webcast will be archived on the company’s website following the live event.
Non-GAAP Financial Measures
Global Payments supplements revenues, operating income, operating margin and net income and earnings per share determined in accordance with GAAP by providing these measures with certain adjustments (such measures being non-GAAP financial measures) in this earnings release to assist with evaluating our performance. In addition to GAAP measures, management uses these non-GAAP financial measures to focus on the factors the company believes are pertinent to the daily management of our operations. The constant currency growth measures adjust for the impact of exchange rates and are calculated using average exchange rates during the comparable period in 2021.
Global Payments also has provided supplemental non-GAAP information to reflect the pending divestiture of the consumer portion of the Consumer Solutions segment. Management believes that providing such supplemental financial information should enhance shareholders’ ability to evaluate how the business will be managed going forward.
Reconciliations of each of the non-GAAP financial 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 payments technology company delivering innovative software and services to our customers globally. Our technologies, services and team member expertise allow us to provide a broad range of solutions that enable our customers to operate their businesses more efficiently across a variety of channels around the world.
Headquartered in Georgia with approximately 25,000 team members worldwide, Global Payments is a Fortune 500® company and a member of the S&P 500 with worldwide reach spanning over 170 countries throughout North America, Europe, Asia Pacific and Latin America. For more information, visit www.globalpayments.com and follow Global Payments on Twitter (@globalpayinc), LinkedIn and Facebook.
Forward-Looking Statements
Investors are cautioned that some of the statements we use in this report contain forward-looking statements and are made pursuant to the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which are based on current expectations, estimates and projections about the industry and markets in which we operate, and beliefs of and assumptions made by our management, involve risks and uncertainties that could significantly affect the financial condition, results of operations, business plans and the future performance of Global Payments. Actual events or results might differ materially from those expressed or forecasted in these forward-looking statements. Accordingly, we cannot guarantee that our plans and expectations will be achieved. Examples of forward-looking statements include, but are not limited to, statements we make regarding guidance and projected financial results for the year 2022; the effects of the COVID-19 pandemic and other global events and economic conditions on our business; statements about the strategic rationale and benefits of the proposed acquisition of EVO Payments, Inc. (“EVO”), including future financial and operating results, the combined company’s plans, objectives, expectation and intentions and the expected timing of completion of the proposed transaction; planned divestitures or strategic initiatives; our success and timing in developing and introducing new services; and future financial and operating results. Although we believe that the plans and expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that our plans and expectations will be attained, and therefore actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements.
In addition to factors previously disclosed in Global Payments’ reports filed with the SEC and those identified elsewhere in this communication, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: the effects of global economic, political, market, health and social events or other conditions, including the effects and duration of, and actions taken in response to, the COVID-19 pandemic and the evolving situation involving Ukraine and Russia; foreign currency exchange, inflation and rising interest rates; difficulties, delays and higher than anticipated costs related to integrating the businesses of acquired companies, including with respect to implementing controls to prevent a material security breach of any internal systems or to successfully manage credit and fraud risks in business units; our ability to complete the proposed transaction with EVO on the proposed terms or on the proposed timeline, or at all, including risks and uncertainties related to securing the necessary regulatory approvals and the satisfaction of other closing conditions; the occurrence of any event, change or other circumstance that could give rise to the termination of the definitive merger agreement relating to the transaction with EVO; effects relating to the announcement of the proposed transaction with EVO, including on the market price of our common stock and our relationships with customers, employees and suppliers; the risk of potential stockholder litigation associated with the proposed transaction with EVO; the effect of a security breach or operational failure on our business; failing to comply with the applicable requirements of Visa, Mastercard or other payment networks or card schemes or changes in those requirements; the ability to maintain Visa and Mastercard registration and financial institution sponsorship; the ability to retain, develop and hire key personnel; the diversion of management’s attention from ongoing business operations; the continued availability of capital and financing; increased competition in the markets in which we operate and our ability to increase our market share in existing markets and expand into new markets; our ability to safeguard our data; risks associated with our indebtedness; our ability to meet environmental, social or governance targets, goals and commitments; the potential effect of climate change including natural disasters; the effects of new or changes in current laws, regulations, credit card association rules or other industry standards on us or our partners and customers, including privacy and cybersecurity laws and regulations; and other events beyond our control, such as acts of terrorism, and other factors included in the “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021, and in other documents that we file with the SEC, which are available at https://www.sec.gov.
These cautionary statements qualify all of our forward-looking statements, and you are cautioned not to place undue reliance on these forward-looking statements. Our forward-looking statements speak only as of the date they are made and should not be relied upon as representing our plans and expectations as of any subsequent date. While we may elect to update or revise forward-looking statements at some time in the future, we specifically disclaim any obligation to publicly release the results of any revisions to our forward-looking statements, except as required by law.
|
SCHEDULE 1 CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) GLOBAL PAYMENTS INC. AND SUBSIDIARIES (In thousands, except per share data) |
|||||||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||
|
|
September 30, |
|
September 30, |
||||||||||||||||||
|
|
2022 |
|
2021 |
|
% Change |
|
2022 |
|
2021 |
|
% Change |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Revenues |
$ |
2,285,371 |
|
|
$ |
2,202,337 |
|
|
3.8 |
% |
|
$ |
6,722,531 |
|
|
$ |
6,329,781 |
|
|
6.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Cost of service |
|
931,249 |
|
|
|
944,172 |
|
|
(1.4 |
)% |
|
|
2,850,706 |
|
|
|
2,805,728 |
|
|
1.6 |
% |
|
Selling, general and administrative |
|
918,757 |
|
|
|
858,082 |
|
|
7.1 |
% |
|
|
2,605,085 |
|
|
|
2,486,153 |
|
|
4.8 |
% |
|
Impairment of goodwill |
|
— |
|
|
|
— |
|
|
— |
|
|
|
833,075 |
|
|
|
— |
|
|
nm |
|
|
Loss on business dispositions |
|
48,933 |
|
|
|
— |
|
|
nm |
|
|
|
201,144 |
|
|
|
— |
|
|
nm |
|
|
|
|
1,898,939 |
|
|
|
1,802,254 |
|
|
|
|
|
6,490,010 |
|
|
|
5,291,881 |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating income |
|
386,432 |
|
|
|
400,083 |
|
|
(3.4 |
)% |
|
|
232,521 |
|
|
|
1,037,900 |
|
|
(77.6 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Interest and other income |
|
20,393 |
|
|
|
6,320 |
|
|
222.7 |
% |
|
|
25,060 |
|
|
|
16,009 |
|
|
56.5 |
% |
|
Interest and other expense |
|
(135,184 |
) |
|
|
(82,187 |
) |
|
64.5 |
% |
|
|
(327,655 |
) |
|
|
(245,884 |
) |
|
33.3 |
% |
|
|
|
(114,791 |
) |
|
|
(75,867 |
) |
|
|
|
|
(302,595 |
) |
|
|
(229,875 |
) |
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Income (loss) before income taxes and equity in income of equity method investments |
|
271,641 |
|
|
|
324,216 |
|
|
(16.2 |
)% |
|
|
(70,074 |
) |
|
|
808,025 |
|
|
(108.7 |
)% |
|
Income tax expense |
|
14,255 |
|
|
|
50,117 |
|
|
(71.6 |
)% |
|
|
119,250 |
|
|
|
131,600 |
|
|
(9.4 |
)% |
|
Income (loss) before equity in income of equity method investments |
|
257,386 |
|
|
|
274,099 |
|
|
(6.1 |
)% |
|
|
(189,324 |
) |
|
|
676,425 |
|
|
(128.0 |
)% |
|
Equity in income of equity method investments, net of tax |
|
42,780 |
|
|
|
31,364 |
|
|
36.4 |
% |
|
|
74,074 |
|
|
|
94,261 |
|
|
(21.4 |
)% |
|
Net income (loss) |
|
300,166 |
|
|
|
305,463 |
|
|
(1.7 |
)% |
|
|
(115,250 |
) |
|
|
770,686 |
|
|
(115.0 |
)% |
|
Net income attributable to noncontrolling interests, net of tax |
|
(9,712 |
) |
|
|
(8,727 |
) |
|
11.3 |
% |
|
|
(22,563 |
) |
|
|
(13,679 |
) |
|
64.9 |
% |
|
Net income (loss) attributable to Global Payments |
$ |
290,454 |
|
|
$ |
296,736 |
|
|
(2.1 |
)% |
|
$ |
(137,813 |
) |
|
$ |
757,007 |
|
|
(118.2 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Earnings (loss) per share attributable to Global Payments: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Basic earnings (loss) per share |
$ |
1.06 |
|
|
$ |
1.02 |
|
|
3.9 |
% |
|
$ |
(0.49 |
) |
|
$ |
2.57 |
|
|
(119.1 |
)% |
|
Diluted earnings (loss) per share |
$ |
1.05 |
|
|
$ |
1.01 |
|
|
4.0 |
% |
|
$ |
(0.49 |
) |
|
$ |
2.56 |
|
|
(119.1 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Weighted-average number of shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Basic |
|
275,030 |
|
|
|
291,502 |
|
|
|
|
|
278,411 |
|
|
|
294,262 |
|
|
|
||
|
Diluted |
|
275,435 |
|
|
|
292,507 |
|
|
|
|
|
278,411 |
|
|
|
295,421 |
|
|
|
||
|
Note: nm = not meaningful. |
|||||||||||||||||||||
|
SCHEDULE 2 NON-GAAP FINANCIAL MEASURES (UNAUDITED) GLOBAL PAYMENTS INC. AND SUBSIDIARIES (In thousands, except per share data) |
|||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||
|
|
September 30, |
|
September 30, |
||||||||||||||
|
|
2022 |
|
2021 |
|
% Change |
|
2022 |
|
2021 |
|
% Change |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Adjusted net revenue |
$ |
2,058,237 |
|
$ |
2,000,327 |
|
2.9 |
% |
|
$ |
6,069,342 |
|
$ |
5,753,082 |
|
5.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Adjusted operating income |
|
930,619 |
|
|
855,573 |
|
8.8 |
% |
|
|
2,635,442 |
|
|
2,400,876 |
|
9.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Adjusted net income attributable to Global Payments |
|
683,632 |
|
|
637,328 |
|
7.3 |
% |
|
|
1,926,248 |
|
|
1,781,696 |
|
8.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Adjusted diluted earnings per share attributable to Global Payments |
$ |
2.48 |
|
$ |
2.18 |
|
13.9 |
% |
|
$ |
6.91 |
|
$ |
6.03 |
|
14.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Supplemental Non-GAAP ⁽¹⁾ |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Adjusted net revenue⁽¹⁾ |
$ |
1,927,215 |
|
$ |
1,829,579 |
|
5.3 |
% |
|
$ |
5,629,117 |
|
$ |
5,183,707 |
|
8.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Adjusted operating income⁽¹⁾ |
$ |
876,625 |
|
$ |
812,112 |
|
7.9 |
% |
|
$ |
2,505,920 |
|
$ |
2,234,923 |
|
5.3 |
% |
| _______________ | |
|
(1) |
The supplemental non-GAAP information reflects the pending divestiture of our consumer business. |
|
|
|
|
|
See Schedules 6 and 7 for a reconciliation of each non-GAAP financial measure to the most comparable GAAP measure, Schedules 8 and 9 for a reconciliation of adjusted net revenue and adjusted operating income by segment and supplemental non-GAAP information to the most comparable GAAP measure, and Schedule 10 for a discussion of non-GAAP financial measures. |
|
SCHEDULE 3 SEGMENT INFORMATION (UNAUDITED) GLOBAL PAYMENTS INC. AND SUBSIDIARIES (In thousands) |
||||||||||||||||||||||
|
|
|
Three Months Ended |
|
|
|
|
||||||||||||||||
|
|
|
September 30, 2022 |
|
September 30, 2021 |
|
% Change |
||||||||||||||||
|
|
|
GAAP |
|
Non-GAAP |
|
GAAP |
|
Non-GAAP |
|
GAAP |
|
Non-GAAP |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Merchant Solutions |
|
$ |
1,596,326 |
|
|
$ |
1,450,023 |
|
|
$ |
1,495,898 |
|
|
$ |
1,357,617 |
|
|
6.7 |
% |
|
6.8 |
% |
|
Issuer Solutions |
|
|
566,039 |
|
|
|
489,149 |
|
|
|
545,486 |
|
|
|
481,075 |
|
|
3.8 |
% |
|
1.7 |
% |
|
Consumer Solutions |
|
|
147,337 |
|
|
|
142,599 |
|
|
|
183,591 |
|
|
|
183,593 |
|
|
(19.7 |
)% |
|
(22.3 |
)% |
|
Intersegment Elimination |
|
|
(24,331 |
) |
|
|
(23,534 |
) |
|
|
(22,638 |
) |
|
|
(21,958 |
) |
|
(7.5 |
)% |
|
(7.2 |
)% |
|
|
|
$ |
2,285,371 |
|
|
$ |
2,058,237 |
|
|
$ |
2,202,337 |
|
|
|
2,000,327 |
|
|
3.8 |
% |
|
2.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Merchant Solutions |
|
$ |
550,684 |
|
|
$ |
724,392 |
|
|
$ |
488,407 |
|
|
$ |
669,462 |
|
|
12.8 |
% |
|
8.2 |
% |
|
Issuer Solutions |
|
|
97,548 |
|
|
|
226,842 |
|
|
|
85,717 |
|
|
|
208,094 |
|
|
13.8 |
% |
|
9.0 |
% |
|
Consumer Solutions |
|
|
23,175 |
|
|
|
53,994 |
|
|
|
27,208 |
|
|
|
43,461 |
|
|
(14.8 |
)% |
|
24.2 |
% |
|
Corporate |
|
|
(236,042 |
) |
|
|
(74,609 |
) |
|
|
(201,249 |
) |
|
|
(65,443 |
) |
|
(17.3 |
)% |
|
(14.0 |
)% |
|
Loss on business dispositions |
|
|
(48,933 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
nm |
|
|
nm |
|
|
|
|
$ |
386,432 |
|
|
$ |
930,619 |
|
|
$ |
400,083 |
|
|
$ |
855,573 |
|
|
(3.4 |
)% |
|
8.8 |
% |
|
|
|
Nine Months Ended |
|
|
|
|
||||||||||||||||
|
|
|
September 30, 2022 |
|
September 30, 2021 |
|
% Change |
||||||||||||||||
|
|
|
GAAP |
|
Non-GAAP |
|
GAAP |
|
Non-GAAP |
|
GAAP |
|
Non-GAAP |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Merchant Solutions |
|
$ |
4,651,061 |
|
|
$ |
4,221,149 |
|
|
$ |
4,190,524 |
|
|
$ |
3,796,146 |
|
|
11.0 |
% |
|
11.2 |
% |
|
Issuer Solutions |
|
|
1,663,008 |
|
|
|
1,441,763 |
|
|
|
1,596,104 |
|
|
|
1,411,345 |
|
|
4.2 |
% |
|
2.2 |
% |
|
Consumer Solutions |
|
|
478,082 |
|
|
|
473,344 |
|
|
|
608,645 |
|
|
|
608,599 |
|
|
(21.5 |
)% |
|
(22.2 |
)% |
|
Intersegment Elimination |
|
|
(69,620 |
) |
|
|
(66,913 |
) |
|
|
(65,492 |
) |
|
|
(63,006 |
) |
|
(6.3 |
)% |
|
(6.2 |
)% |
|
|
|
$ |
6,722,531 |
|
|
$ |
6,069,342 |
|
|
$ |
6,329,781 |
|
|
$ |
5,753,082 |
|
|
6.2 |
% |
|
5.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Merchant Solutions |
|
$ |
1,530,573 |
|
|
$ |
2,076,288 |
|
|
$ |
1,265,689 |
|
|
$ |
1,826,260 |
|
|
20.9 |
% |
|
13.7 |
% |
|
Issuer Solutions |
|
|
244,190 |
|
|
|
640,061 |
|
|
|
245,588 |
|
|
|
613,428 |
|
|
(0.6 |
)% |
|
4.3 |
% |
|
Consumer Solutions |
|
|
67,735 |
|
|
|
129,522 |
|
|
|
114,804 |
|
|
|
165,952 |
|
|
(41.0 |
)% |
|
(22.0 |
)% |
|
Corporate |
|
|
(575,758 |
) |
|
|
(210,428 |
) |
|
|
(588,181 |
) |
|
|
(204,764 |
) |
|
2.1 |
% |
|
(2.8 |
)% |
|
Impairment of goodwill |
|
|
(833,075 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
nm |
|
|
nm |
|
|
Loss on business dispositions |
|
|
(201,144 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
nm |
|
|
nm |
|
|
|
|
$ |
232,521 |
|
|
$ |
2,635,442 |
|
|
$ |
1,037,900 |
|
|
$ |
2,400,876 |
|
|
(77.6 |
)% |
|
9.8 |
% |
| _______________ |
|
See Schedules 8 and 9 for a reconciliation of adjusted net revenue and adjusted operating income by segment to the most comparable GAAP measures and Schedule 10 for a discussion of non-GAAP financial measures. |
|
|
|
During the third quarter of 2022, as a result of the pending divestiture of our consumer business and changes in how the business is now managed, we have realigned the businesses previously comprising our Business and Consumer Solutions segment to include the business-to-business portion within our Issuer Solutions segment and the consumer portion within our Consumer Solutions segment. Our three reportable segments now are: Merchant Solutions, Issuer Solutions and Consumer Solutions. The presentation of segment information for the three and nine months ended September 30, 2021 has been recast to align with the segment presentation for the three and nine months ended September 30, 2022. |
|
|
|
Note: Amounts may not sum due to rounding. |
|
|
|
Note: nm = not meaningful. |
|
SCHEDULE 4 CONSOLIDATED BALANCE SHEETS (UNAUDITED) GLOBAL PAYMENTS INC. AND SUBSIDIARIES (In thousands, except share data) |
|||||||
|
|
September 30, |
|
December 31, |
||||
|
|
|
|
|
||||
|
ASSETS |
|
|
|
||||
|
Current assets: |
|
|
|
||||
|
Cash and cash equivalents |
$ |
1,993,840 |
|
|
$ |
1,979,308 |
|
|
Accounts receivable, net |
|
998,231 |
|
|
|
946,247 |
|
|
Settlement processing assets |
|
1,740,844 |
|
|
|
1,143,539 |
|
|
Current assets held for sale |
|
93,740 |
|
|
|
4,779 |
|
|
Prepaid expenses and other current assets |
|
626,697 |
|
|
|
637,112 |
|
|
Total current assets |
|
5,453,352 |
|
|
|
4,710,985 |
|
|
Goodwill |
|
23,421,031 |
|
|
|
24,813,274 |
|
|
Other intangible assets, net |
|
9,907,884 |
|
|
|
11,633,709 |
|
|
Property and equipment, net |
|
1,759,235 |
|
|
|
1,687,586 |
|
|
Deferred income taxes |
|
25,657 |
|
|
|
12,117 |
|
|
Noncurrent assets held for sale |
|
1,038,806 |
|
|
|
— |
|
|
Other noncurrent assets |
|
2,332,784 |
|
|
|
2,422,042 |
|
|
Total assets |
$ |
43,938,749 |
|
|
$ |
45,279,713 |
|
|
|
|
|
|
||||
|
LIABILITIES AND EQUITY |
|
|
|
||||
|
Current liabilities: |
|
|
|
||||
|
Settlement lines of credit |
$ |
440,950 |
|
|
$ |
484,202 |
|
|
Current portion of long-term debt |
|
1,157,811 |
|
|
|
78,505 |
|
|
Accounts payable and accrued liabilities |
|
2,207,551 |
|
|
|
2,542,256 |
|
|
Settlement processing obligations |
|
1,795,140 |
|
|
|
1,358,051 |
|
|
Current liabilities held for sale |
|
75,233 |
|
|
|
— |
|
|
Total current liabilities |
|
5,676,685 |
|
|
|
4,463,014 |
|
|
Long-term debt |
|
12,289,826 |
|
|
|
11,414,809 |
|
|
Deferred income taxes |
|
2,439,657 |
|
|
|
2,793,427 |
|
|
Noncurrent liabilities held for sale |
|
4,494 |
|
|
|
— |
|
|
Other noncurrent liabilities |
|
655,132 |
|
|
|
739,046 |
|
|
Total liabilities |
|
21,065,794 |
|
|
|
19,410,296 |
|
|
Commitments and contingencies |
|
|
|
||||
|
Equity: |
|
|
|
||||
|
Preferred stock, no par value; 5,000,000 shares authorized and none issued |
|
— |
|
|
|
— |
|
|
Common stock, no par value; 400,000,000 shares authorized at September 30, 2022 and December 31, 2021; 270,307,707 issued and outstanding at September 30, 2022 and 284,750,452 issued and outstanding at December 31, 2021 |
|
— |
|
|
|
— |
|
|
Paid-in capital |
|
20,717,133 |
|
|
|
22,880,261 |
|
|
Retained earnings |
|
2,547,947 |
|
|
|
2,982,122 |
|
|
Accumulated other comprehensive loss |
|
(604,501 |
) |
|
|
(234,182 |
) |
|
Total Global Payments shareholders’ equity |
|
22,660,579 |
|
|
|
25,628,201 |
|
|
Noncontrolling interests |
|
212,376 |
|
|
|
241,216 |
|
|
Total equity |
|
22,872,955 |
|
|
|
25,869,417 |
|
|
Total liabilities and equity |
$ |
43,938,749 |
|
|
$ |
45,279,713 |
|
|
SCHEDULE 5 CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) GLOBAL PAYMENTS INC. AND SUBSIDIARIES (In thousands) |
|||||||
|
|
Nine Months Ended |
||||||
|
|
September 30, |
|
September 30, |
||||
|
|
|
|
|
||||
|
Cash flows from operating activities: |
|
|
|
||||
|
Net (loss) income |
$ |
(115,250 |
) |
|
$ |
770,686 |
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
|
|
|
||||
|
Depreciation and amortization of property and equipment |
|
299,348 |
|
|
|
292,230 |
|
|
Amortization of acquired intangibles |
|
962,413 |
|
|
|
973,948 |
|
|
Amortization of capitalized contract costs |
|
81,052 |
|
|
|
68,112 |
|
|
Share-based compensation expense |
|
122,465 |
|
|
|
146,097 |
|
|
Provision for operating losses and credit losses |
|
87,071 |
|
|
|
73,286 |
|
|
Noncash lease expense |
|
63,211 |
|
|
|
80,371 |
|
|
Deferred income taxes |
|
(281,376 |
) |
|
|
(136,004 |
) |
|
Equity in income of equity method investments, net of tax |
|
(74,074 |
) |
|
|
(94,261 |
) |
|
Facilities exit charges |
|
27,662 |
|
|
|
— |
|
|
Distribution received on investments |
|
8,212 |
|
|
|
26,757 |
|
|
Impairment of goodwill |
|
833,075 |
|
|
|
— |
|
|
Loss on business dispositions |
|
201,144 |
|
|
|
— |
|
|
Other, net |
|
(3,273 |
) |
|
|
(6,790 |
) |
|
Changes in operating assets and liabilities, net of the effects of business combinations: |
|
|
|
||||
|
Accounts receivable |
|
(107,908 |
) |
|
|
(123,370 |
) |
|
Settlement processing assets and obligations, net |
|
(117,989 |
) |
|
|
28,242 |
|
|
Prepaid expenses and other assets |
|
(224,529 |
) |
|
|
(185,973 |
) |
|
Accounts payable and other liabilities |
|
(226,746 |
) |
|
|
114,279 |
|
|
Net cash provided by operating activities |
|
1,534,508 |
|
|
|
2,027,610 |
|
|
Cash flows from investing activities: |
|
|
|
||||
|
Business combinations and other acquisitions, net of cash acquired |
|
(24,969 |
) |
|
|
(946,377 |
) |
|
Capital expenditures |
|
(463,357 |
) |
|
|
(350,745 |
) |
|
Effect on cash from sale of business |
|
(29,755 |
) |
|
|
— |
|
|
Proceeds from sale of investments |
|
31,046 |
|
|
|
— |
|
|
Other, net |
|
101 |
|
|
|
1,248 |
|
|
Net cash used in investing activities |
|
(486,934 |
) |
|
|
(1,295,874 |
) |
|
Cash flows from financing activities: |
|
|
|
||||
|
Net (repayments of) borrowings from settlement lines of credit |
|
(2,770 |
) |
|
|
244,858 |
|
|
Proceeds from long-term debt |
|
9,124,449 |
|
|
|
3,909,988 |
|
|
Repayments of long-term debt |
|
(7,193,661 |
) |
|
|
(2,434,805 |
) |
|
Payments of debt issuance costs |
|
(44,360 |
) |
|
|
(8,569 |
) |
|
Repurchases of common stock |
|
(2,139,731 |
) |
|
|
(1,833,689 |
) |
|
Proceeds from stock issued under share-based compensation plans |
|
33,776 |
|
|
|
38,570 |
|
|
Common stock repurchased – share-based compensation plans |
|
(38,366 |
) |
|
|
(84,659 |
) |
|
Distributions to noncontrolling interests |
|
(17,729 |
) |
|
|
— |
|
|
Contribution from a noncontrolling interest |
|
— |
|
|
|
46,320 |
|
|
Payment of contingent consideration in business combination |
|
(15,726 |
) |
|
|
— |
|
|
Purchase of capped calls related to issuance of convertible notes |
|
(302,375 |
) |
|
|
— |
|
|
Dividends paid |
|
(208,082 |
) |
|
|
(188,203 |
) |
|
Net cash used in financing activities |
|
(804,575 |
) |
|
|
(310,189 |
) |
|
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
(208,529 |
) |
|
|
(42,704 |
) |
|
Increase in cash, cash equivalents and restricted cash |
|
34,470 |
|
|
|
378,843 |
|
|
Cash, cash equivalents and restricted cash, beginning of the period |
|
2,123,023 |
|
|
|
2,089,771 |
|
|
Cash, cash equivalents and restricted cash, end of the period |
$ |
2,157,493 |
|
|
$ |
2,468,614 |
|
Contacts
Investor contact:
investor.relations@globalpay.com
Winnie Smith
770-829-8478
Media contact:
media.relations@globalpay.com
Emily Edmonds
770-829-8755
