Visa Inc. · NYSE:V
Visa — Q4 2012 Earnings Presentation
21 slides from Visa's earnings presentation, Oct 31, 2012
Slide 1: Visa Inc. Fiscal Fourth Quarter Financial Results
Visa Inc. Fiscal Fourth Quarter Financial Results October 31, 2012
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward−looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by the terms "believe," "continue," “expect," and similar references to the future. Examples of such fo
Slide 3: Solid Fiscal Fourth Quarter Results
Solid Fiscal Fourth Quarter Results • Strong operating revenues of $2.7 billion for the fourth quarter, up 15% over prior year • Adjusted quarterly net income of $1.0 billion, up 18%, and adjusted diluted earnings per share of $1.54, up 21% over prior year • Total as-converted class A common stock w
Slide 4: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended June 2011 ROW = Rest of World 2012 941 978 U.S. U.S. 518 512 623 572 U.S. US 224 246 369 355 ROW ROW U.S. U.S. 423 466 ROW ROW 294 267 348 378 ROW 75 ROW 88 Total Visa Inc. Credit Debit YOY Change (nominal) 4% 9% (4%) YOY Cha
Slide 5: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended September Note: Current quarter payments volume and other select metrics are provided in the operational performance data supplement to provide more recent operating data. Service revenues continue to be recognized based on p
Slide 6: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended June 2011 2012 518 512 277 248 85 88 55 56 35 45 United States Asia Pacific Latin America and Canada Central and Eastern Caribbean Europe, Middle East and Africa YOY Change (nominal) (1%) 12% 3% 2% 28% YOY Change (constant) (
Slide 7: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended September Note: Current quarter payments volume and other select metrics are provided in the operational performance data supplement to provide more recent operating data. Service revenues continue to be recognized based on p
Slide 8: Transactions
Transactions in millions, except percentages Quarter ended September 2011 2012 20,532 19,808 Credit Credit 36% 38% 13,263 13,573 Debit Debit 64% 62% Total Processed Transactions Transactions YOY 2% 4% Change Note: Processed transactions represent transactions involving Visa, Visa Electron, Interlink
Slide 9: Total Cards
Total Cards in millions, except percentages Quarter ended June 2011 2012 2,032 1,903 1,251 1,137 766 781 Credit Debit Visa Inc. YOY Change 2% 10% 7% Note: From time to time, previously submitted card information may be updated. Prior period updates are not material. Figures may not recalculate exact
Slide 10: Revenue – Q4 2012
Revenue – Q4 2012 US$ in millions, except percentages Fiscal 2011 Fiscal 2012 3,294 2,959 2,731 2,383 (576) (563) Gross Revenues Incentives Net Operating Revenues YOY Change 11% (2%) 15% FY12 % of Gross Revenues 17% 83% Note: Figures may not recalculate exactly due to rounding. Percentage changes ca
Slide 11: Revenue Detail – Q4 2012
Revenue Detail – Q4 2012 US$ in millions, except percentages Fiscal 2011 Fiscal 2012 1,264 1,105 1,062 925 758 796 171 172 Service Data Processing International Other Revenues Revenues Revenues Transaction Revenues YOY Change 14% 15% 5% –% Note: Figures may not recalculate exactly due to rounding. P
Slide 12: Operating Margin – Q4 2012
Operating Margin – Q4 2012 US$ in millions, except percentages Fiscal 2011 Fiscal 2012 2,731 2,383 57% 56% 1,522 1,362 1,209 1,021 Net Operating Total Operating Operating Operating Revenues Expenses Income Margin YOY 15% 18% 12% (1 ppt) Change Note: Operating margin is calculated as operating income
Slide 13: Operating Expenses – Q4 2012
Operating Expenses – Q4 2012 US$ in millions, except percentages Fiscal 2011 471 Fiscal 2012 388 271 239 134 131 106 111 115 95 77 89 1 2 Personnel Network Marketing Professional Depreciation General Litigation & Fees & & Provision Processing Amortization Administrative YOY Change 22% 4% 13% 17% 16%
Slide 14: Other Financial Results
Other Financial Results • Cash, cash equivalents, restricted cash, and available-for-sale investment securities of $10.5 billion at the end of the fiscal year, which includes $4.4 billion of restricted cash in the litigation escrow account • Free cash flow of $1.3 billion for the fiscal fourth quart
Slide 15: Financial Metrics for Fiscal Year 2013
Financial Metrics for Fiscal Year 2013 Low double Annual net revenue growth digits 18% to 18.5% Client incentives as % of gross revenues range Under $1 Marketing expenses billion Adjusted annual operating margin About 60% Fiscal Fourth Quarter 2012 Financial Results 15
Slide 16: Financial Metrics for Fiscal Year 2013
Financial Metrics for Fiscal Year 2013 Tax rate 30% to 32% range Adjusted annual diluted class A common stock High teens earnings per share growth $425 million to Capital expenditures $475 million range Annual free cash flow About $5 billion Fiscal Fourth Quarter 2012 Financial Results 16
Slide 17: Appendix: Reconciliation of Non-GAAP Measures
Appendix Reconciliation of Non-GAAP Measures
Slide 18: Reconciliation of Non-GAAP Financial Results – Q4 2012
Reconciliation of Non-GAAP Financial Results – Q4 2012 US$ in millions, except per share data During the fourth quarter of fiscal 2012, the IRS issued a revised Revenue Agent Report effectively withdrawing its proposed adjustment, which would have disallowed the deduction of payments made in fiscal
Slide 19: Reconciliation of Non-GAAP Financial Results – Full Year
Reconciliation of Non-GAAP Financial Results – Full Year US$ in millions, except percentages and per share data Our financial results for fiscal 2012 and 2011 were impacted by the following special items: • Reversal of tax reserves: During the fourth quarter of fiscal 2012, we reversed all previousl
Slide 20: Reconciliation of Non-GAAP Financial Results – Effective Tax Rate
Reconciliation of Non-GAAP Financial Results – Effective Tax Rate US$ in millions, except per share data Our effective income tax rate for fiscal 2012 was impacted by the aforementioned special items. We believe inclusion of these special items in our effective income tax rate is not indicative of o
Slide 21: Calculation of Free Cash Flow
Calculation of Free Cash Flow US$ in millions Additions (+) / Reductions (-) to Net income attributable to Three Months Ended Twelve Months Ended Visa Inc. September 30, 2012 September 30, 2012 Net income attributable to Visa Inc. (as reported) 1,662 2,144 Capital Assets + Depreciation and amortizat