Visa Inc. · NYSE:V
Visa — Q2 FY2012 Earnings Presentation
20 slides from Visa's earnings presentation, May 2, 2012
Slide 1: Visa Inc. Fiscal Second Quarter Financial Results
Visa Inc. Fiscal Second Quarter Financial Results May 2, 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 “expect,” “will,” “continue” and similar references to the future. Examples of such forwar
Slide 3: Solid Fiscal Second Quarter Results
Solid Fiscal Second Quarter Results • Strong operating revenues of $2.6 billion, up 15% over prior year • Adjusted quarterly net income of $1.1 billion, up 23%, and adjusted diluted earnings per share of $1.60, up 30% over prior year • Continued positive secular trends and spending momentum contribu
Slide 4: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended December 2010 2011 ROW = Rest of World 993 897 U.S. U.S. 616 493 529 550 U.S. U.S. 378 216 348 237 U.S. U.S. ROW ROW 277 292 405 464 ROW ROW 334 379 ROW 71 ROW 85 Total Visa Inc. Credit Debit YOY Change (nominal) 11% 12% 9% Y
Slide 5: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended March 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 payme
Slide 6: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended December 2010 2011 529 493 276 240 81 93 53 56 39 30 United States Asia Pacific Latin America and Canada Central and Eastern Caribbean Europe, Middle East and Africa YOY Change (nominal) 7% 15% 15% 5% 29% YOY Change (constant
Slide 7: Payments Volume
Payments Volume US$ in billions, nominal, except percentages Quarter ended March 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 payme
Slide 8: Transactions
Transactions in millions, except percentages Quarter ended December Quarter ended March 2010 2011 2011 2012 20,348 19,515 18,845 18,046 Credit Credit Credit Credit 36% 36% 35% 36% 13,600 13,038 12,580 12,040 Debit Debit 64% 64% Debit Debit 65% 64% Total Processed Total Processed Transactions Transac
Slide 9: Total Cards
Total Cards in millions, except percentages Quarter ended December 2010 2011 2,011 1,897 1,232 1,127 770 779 Credit Debit Visa Inc. YOY Change 1% 9% 6% Note: From time to time, previously submitted card information may be updated. Prior period updates are not material. Second Quarter Fiscal 2012 Fin
Slide 10: Revenue – Q2 2012
Revenue – Q2 2012 US$ in millions, except percentages Fiscal 2011 Fiscal 2012 3,075 2,696 2,578 2,245 (451) (497) Gross Revenues Incentives Net Operating Revenues YOY Change 14% 10% 15% FY12 % of Gross Revenues 16% 84% Note: Growth rates and percentage of gross revenues calculated based on whole num
Slide 11: Revenue Detail – Q2 2012
Revenue Detail – Q2 2012 US$ in millions, except percentages Fiscal 2011 Fiscal 2012 1,241 1,093 922 823 733 624 156 179 Service Data Processing International Other Revenues Revenues Transaction Revenues Revenues YOY Change 13% 12% 17% 14% Note: Growth rates calculated based on whole numbers, not ro
Slide 12: Operating Margin – Q2 2012
Operating Margin – Q2 2012 US$ in millions, except percentages Fiscal 2011 Fiscal 2012 2,578 2,245 62% 62% 1,606 1,383 972 862 Net Operating Total Operating Operating Operating Revenues Expenses Income Margin YOY Change 15% 13% 16% NM Note: Growth rates calculated based on whole numbers, not rounded
Slide 13: Operating Expenses – Q2 2012
Operating Expenses – Q2 2012 US$ in millions, except percentages Fiscal 2011 Fiscal 2012 431 351 183 170 103 95 106 80 77 82 70 80 6 0 Personnel Network Marketing Professional Fees Depreciation General Litigation Provision and Processing and Amortization and Administrative YOY Change 23% 28% (7%) 6%
Slide 14: Other Financial Results
Other Financial Results • Cash, cash equivalents, restricted cash, and available-for-sale investment securities of $8.9 billion at the end of the fiscal second quarter, which includes $4.3 billion of restricted cash in the litigation escrow account • Free cash flow of $1.1 billion for the fiscal sec
Slide 15: Financial Metrics for Fiscal Year 2012
Financial Metrics for Fiscal Year 2012 Annual net revenue growth Low double digits 17% to 18% Client incentives as % of gross revenues range Marketing expenses Under $1 billion Annual operating margin About 60% Second Quarter Fiscal 2012 Financial Results 15
Slide 16: Financial Metrics for Fiscal Year 2012
Financial Metrics for Fiscal Year 2012 33% to 34% Adjusted tax rate range* Adjusted annual diluted class A common stock High teens to earnings per share growth low twenties $350 million to Capital expenditures $400 million range Greater than Annual free cash flow $4 billion * Excludes the impact of
Slide 17: Appendix: Reconciliation of Non-GAAP Measures
Appendix Reconciliation of Non-GAAP Measures
Slide 18: Reconciliation of Non-GAAP Financial Results
Reconciliation of Non-GAAP Financial Results US$ in millions, except per share data During the three months ended March 31, 2012, the state of California approved certain changes to its state tax apportionment rules, effective retroactively to the beginning of fiscal 2012, which lowered our overall
Slide 19: Reconciliation of Non-GAAP Financial Results
Reconciliation of Non-GAAP Financial Results As discussed in the previous slide, during the three months ended March 31, 2012, we recorded a one-time, non-cash benefit resulting from the remeasurement of our existing net deferred tax liabilities. This adjustment has no cash impact to us. Management
Slide 20: Calculation of Free Cash Flow
Calculation of Free Cash Flow US$ in millions Additions (+) / Reductions (-) to Net income attributable to Three Months Ended Six Months Ended Visa Inc. March 31, 2012 March 31, 2012 Net income attributable to Visa Inc. (as reported) 1,292 2,321 Capital Assets + Depreciation and amortization 80 160