Visa Inc. · NYSE:V
Visa — Q1 2010 Earnings Presentation
19 slides from Visa's earnings presentation, Feb 3, 2010
Slide 1: Visa Inc. Fiscal First Quarter Financial Results
Visa Inc. Fiscal First Quarter Financial Results February 3, 2010
Slide 2: Safe Harbor Reminder
Safe Harbor Reminder • Certain statements contained in this press release 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
Slide 3: Solid Fiscal First Quarter Results
Solid Fiscal First Quarter Results • Strong operating revenues of $2.0 billion, up 13% over prior year • Quarterly net income of $763 million, up 33%, and diluted earnings of $1.02 per share, up 38% over prior year • Repurchased 5.5 million shares of class A common stock at an average price of $78.7
Slide 4: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended September 2008 ROW = Rest of World 701 720 2009 U.S. U.S. 421 417 452 452 U.S. U.S. 213 195 249 268 ROW ROW U.S. U.S. 280 303 ROW ROW 208 223 239 258 ROW 41 ROW 45 Total Visa Inc. Credit Debit YOY Change (nominal) 3% 0% 8% YO
Slide 5: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended December Commencing this quarter, current payments volume and other select metrics are provided in the operational performance data supplement. Service revenues will continue to be recognized based on payments volume in the p
Slide 6: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended September 2008 421 417 2009 183 163 51 55 44 44 21 21 United States Asia Pacific Latin America and Canada Central and Caribbean Eastern Europe, Middle East and Africa YOY Change (nominal) (1%) 12% 9% (1%) (2%) YOY Change (con
Slide 7: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended December Commencing this quarter, current payments volume and other select metrics are provided in the operational performance data supplement. Service revenues will continue to be recognized based on payments volume in the p
Slide 8: Transactions – Q1 2010
Transactions – Q1 2010 in millions, except percentages Quarter ended September Quarter ended December 2008 15,855 16,572 2009 14,483 14,898 Credit Credit Credit Credit 10,463 10,924 39% 37% 39% 37% 9,797 9,590 Debit Debit Debit Debit 61% 63% 61% 63% Total Transactions Processed Total Transactions Pr
Slide 9: Total Cards
Total Cards in millions, except percentages Quarter ended September 2008 1,766 2009 1,676 979 812 864 787 Credit Debit Visa Inc. YOY (3%) 13% 5% Change Fiscal Q1 2010 Earnings Results 9
Slide 10: Revenue – Q1 2010
Revenue – Q1 2010 US$ in millions, except percentages Fiscal 2009 Fiscal 2010 2,334 2,008 1,960 1,739 (269) Gross (374) Net Operating Revenues Incentives Revenues YOY 16% 39% 13% Change Note: Growth rates calculated based on whole numbers, not rounded numbers. Fiscal Q1 2010 Earnings Results 10
Slide 11: Revenue Detail – Q1 2010
Revenue Detail – Q1 2010 US$ in millions, except percentages Fiscal 2009 Fiscal 2010 827 793 765 554 552 505 190 156 Service Data International Other Revenues Processing Transaction Revenues Revenues Revenues YOY 4% 38% 9% 21% Change Note: Growth rates calculated based on whole numbers, not rounded
Slide 12: Operating Margin – Q1 2010
Operating Margin – Q1 2010 US$ in millions, except percentages Fiscal 2009 Fiscal 2010 62% 56% 1,960 1,739 1,217 966 773 743 Operating Margin Net Operating Total Operating Operating Income Revenues Expenses YOY 6 ppts 13% (4%) 26% Change Note: Growth rates calculated based on whole numbers, not roun
Slide 13: Operating Expenses – Q1 2010
Operating Expenses – Q1 2010 US$ in millions, except percentages Fiscal 2009 Fiscal 2010 773 743 299 274 210 216 93 105 78 56 51 52 62 63 0 Professional (43) Network, Advertising, and Depreciation EDP and Marketing and Consulting and Administrative Litigation Total Operating Personnel Communications
Slide 14: Other Financial Results
Other Financial Results • Cash, cash equivalents, restricted cash and available-for-sale investment securities of $6.0 billion at the end of the fiscal first quarter which includes $1.6 billion of restricted cash for litigation escrow • Free cash flow of $788 million • Utilized $432 million of the o
Slide 15: Financial Metrics for Fiscal Year 2010
Financial Metrics for Fiscal Year 2010 Annual net revenue growth 11-15% range 16-17% of Volume and support incentives gross revenue Less than Advertising, marketing and promotion expenses $1 billion Mid to high Annual operating margin 50% range Fiscal Q1 2010 Earnings Results 15
Slide 16: Financial Metrics for Fiscal Year 2010
Financial Metrics for Fiscal Year 2010 36.5 to 38.5% GAAP tax rate range Annual diluted class A common stock earnings 20% + per share growth FY10: $200-250 million About $200 Capital Expenditures FY11: million Annual free cash flow $2 billion + Fiscal Q1 2010 Earnings Results 16
Slide 17: Appendix: Reconciliation of Non-GAAP Measures
Appendix Reconciliation of Non-GAAP Measures
Slide 18: Adjusted Diluted Class A Common Stock Earnings Per Share
Adjusted Diluted Class A Common Stock Earnings Per Share US$ in millions, except per share data Three months ended December 31, Diluted 2009 EPS (1) Net Income (as reported) $ 763 $ 1.02 Adjustment for non-recurring item: Less: gain from retailers' litigation prepayment (2) (41) Addback: tax expense
Slide 19: Calculation of Free Cash Flow
Calculation of Free Cash Flow US$ in millions Additions (+) / Reductions (-) to Net income attributable to Visa Inc. Q1 FY 2010 Net income attributable to Visa Inc. (as reported) 763 + Depreciation and amortization 62 Capital Assets - Capital expenditures (37) 25 + Litigation provision (43) + Accret