Visa Inc. · NYSE:V
Visa — Q3 2010 Earnings Presentation
19 slides from Visa's earnings presentation, Jul 28, 2010
Slide 1: Visa Inc. Fiscal Third Quarter Financial Results
Visa Inc. Fiscal Third Quarter Financial Results July 28, 2010
Slide 2: Safe Harbor Reminder
Safe Harbor Reminder • Certain statements contained in this presentation are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the “safe harbor” created by t
Slide 3: Solid Fiscal Third Quarter Results
Solid Fiscal Third Quarter Results • Strong operating revenues of $2.0 billion, up 23% over prior year • Quarterly net income of $716 million, up 45% and diluted earnings of $0.97 per share, up 49% over prior year, excluding prior year gain on VisaNet do Brasil sale • On an as-converted basis, repur
Slide 4: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended March 2009 ROW = Rest of World 745 2010 617 U.S. U.S. 449 379 427 380 U.S. U.S. 296 176 182 236 U.S. U.S. ROW ROW ROW ROW 202 245 238 318 204 266 ROW 34 ROW 51 Total Visa Inc. Credit Debit YOY Change (nominal) 21% 18% 25% YOY
Slide 5: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended June 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 payments vol
Slide 6: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended March 2009 427 2010 379 195 147 42 58 43 32 17 23 United States Asia Pacific Latin America and Canada Central and Caribbean Eastern Europe, Middle East and Africa YOY Change (nominal) 13% 32% 38% 34% 31% YOY Change (constant)
Slide 7: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended June 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 payments vol
Slide 8: Transactions
Transactions in millions, except percentages Quarter ended March Quarter ended June 2009 2010 17,596 16,118 15,491 14,305 Credit Credit Credit Credit 11,721 37% 35% 37% 36% 10,648 10,266 9,360 Debit Debit Debit Debit 63% 64% 63% 65% Total Transactions Processed Total Transactions Processed Transacti
Slide 9: Total Cards
Total Cards in millions, except percentages Quarter ended March 2009 1,825 2010 1,723 1,051 925 798 774 Credit Debit Visa Inc. YOY (3%) 14% 6% Change Note: From time to time, previously submitted cards information may be updated. Prior year cards information presented has not been updated, as change
Slide 10: Revenue – Q3 2010
Revenue – Q3 2010 US$ in millions, except percentages Fiscal 2009 Fiscal 2010 2,422 1,990 2,029 1,646 Gross (344) (393) Net Operating Revenues Incentives Revenues YOY 22% 15% 23% Change Note: Growth rates calculated based on whole numbers, not rounded numbers. Fiscal Q3 2010 Earnings Results 10
Slide 11: Revenue Detail – Q3 2010
Revenue Detail – Q3 2010 US$ in millions, except percentages Fiscal 2009 Fiscal 2010 873 769 792 605 574 458 158 183 Service Data International Other Revenues Processing Transaction Revenues Revenues Revenues YOY 13% 31% 25% 15% Change Note: Growth rates calculated based on whole numbers, not rounde
Slide 12: Operating Margin – Q3 2010
Operating Margin – Q3 2010 US$ in millions, except percentages Fiscal 2009 Fiscal 2010 56% 2,029 50% 1,646 1,137 824 892 822 Operating Margin Net Operating Total Operating Operating Income Revenues Expenses YOY 6 ppts 23% 8% 38% Change Note: Growth rates calculated based on whole numbers, not rounde
Slide 13: Operating Expenses – Q3 2010
Operating Expenses – Q3 2010 US$ in millions, except percentages 892 Fiscal 2009 824 Fiscal 2010 282 285 277 229 97 103 96 87 62 77 57 63 1 0 Professional Network, Advertising, and Depreciation Administrative Litigation Total Operating Personnel EDP and Marketing and Consulting and Provision Expense
Slide 14: Other Financial Results
Other Financial Results • Cash, cash equivalents, restricted cash and available-for-sale investment securities of $7.4 billion at the end of the fiscal third quarter which includes $ 2.0 billion of restricted cash for litigation escrow • Fiscal third quarter free cash flow of $1.2 billion • Capital
Slide 15: Financial Metrics for Fiscal Year 2010
Financial Metrics for Fiscal Year 2010 High end of Annual net revenue growth 11-15% range Volume and support incentives as % High end of of gross revenues 16-17% range Less than Advertising, marketing and promotion expenses $1 billion Mid to high Annual operating margin 50% range Fiscal Q3 2010 Earn
Slide 16: Financial Metrics for Fiscal Year 2010
Financial Metrics for Fiscal Year 2010 37% to 38% GAAP tax rate range Annual diluted class A common stock earnings 20% + per share growth FY10: $200-250 Moderately million Capital Expenditures above $200 FY11: million Annual free cash flow $2 billion + Fiscal Q3 2010 Earnings Results 16
Slide 17: Financial Metrics for Fiscal Year 2011
Financial Metrics for Fiscal Year 2011 Annual diluted class A common stock earnings 20% + per share growth Annual free cash flow $2 billion + Fiscal Q3 2010 Earnings Results 17
Slide 18: Appendix: Reconciliation of Non-GAAP Measures
Appendix Reconciliation of Non-GAAP Measures
Slide 19: Calculation of Free Cash Flow
Calculation of Free Cash Flow US$ in millions Additions (+) / Reductions (-) to Net income For the three For the nine attributable to months ended months ended Visa Inc. June 30, 2010 June 30, 2010 Net income attributable to Visa Inc. (as reported) 716 2,192 Capital Assets + Depreciation and amortiz