First Data Corporation Reports Record 1996 and Fourth
Quarter Financial Performance
HACKENSACK, N.J., Jan. 29 /PRNewswire/ -- First Data Corp (First Data) today announced
that the Company again achieved record financial performance for the year and the fourth quarter.
Operating revenues for the year ended Dec. 31, 1996 were up 21% to $4.93 billion from $4.08
billion in the prior year. Pretax income for the year was $1.03 billion compared with $168 million
in 1995, which included a $646 million charge in the fourth quarter of 1995 related to nonrecurring
merger, integration and impairment costs. Results in 1996 include a $46 million gain on the
divestiture of MoneyGram in the fourth quarter and $32 million of merger, integration and
impairment charges ($16 million in the fourth quarter). The Company reported net income of $637
million for the year versus an after tax loss of $84 million in 1995. Excluding the gain and charges
in both years, First Data's net income for the year was $628 million, up 38% from 1995's $456
million.
On a per share basis, earnings for the year were $1.37 compared with a loss of $0.19 per share in
1995. Without the nonrecurring gain and charges, earnings were $1.35 per share, up 32% from
$1.02 per share the prior year.
For the fourth quarter, operating revenues increased 21% to $1.35 billion, up from $1.12 billion in
1995's corresponding quarter. Operating revenue growth, excluding acquisitions and divestitures,
was 19%. Net income was $224 million or $0.48 per share in 1996 versus a net loss of $390
million or $0.88 per share in 1995. Without the nonrecurring charges and gains, net income was
$206 million, or $0.44 per share compared with $150 million or $0.32 per share in the year earlier
period, an increase of 38% on a per share basis.
The record performance in 1996 was driven primarily by the 21% increase in operating revenues,
reflecting internal growth of 18%, plus the effect of acquisitions, with especially strong results in
core merchant processing, card issuer services and payment instruments businesses. Domestic
merchant card volume processed was up 49% for the year to over $214 billion, with a 33% increase
in the number of merchant transactions processed; total card accounts on file were 153 million at
year-end, up 26%; and the number of payment instruments transactions processed for the year rose
14% to 458 million, with money transfer transaction growth particularly strong, up 39% in the
fourth quarter and 31% for the year. Margins were improved significantly, principally due to
operating- and corporate- related synergies realized from the First Financial Management
Corporation (FFMC) merger.
"First Data had a very strong year in 1996," said Ric Duques, First Data chairman and chief
executive officer. "We successfully integrated operations of First Data and FFMC, and at the same
time added new clients, expanded into new markets around the world, introduced additional
products and services, formed strategic partnerships and alliances, and acquired key businesses.
"The year was highlighted by two fourth quarter joint venture agreements, with Wal-Mart to
provide payment and electronic commerce services and with Chase Manhattan Bank to form a
national merchant processing alliance. In early December, we completed the Federal Trade
Commission's divestiture order for MoneyGram through an initial public offering."
"The momentum continues for solid performance in 1997. Electronic commerce, information
management and international expansion will be the three key strategic areas of emphasis, offering
multiple opportunities for growth across our Company."
First Data is a leading provider of information and transaction processing services - converting
information into value. Services include transaction processing and back office support for card
issuers; merchant card and check processing services; consumer and commercial payment services;
debt collection and accounts receivable management; mutual fund processing; health care claims
administration; data imaging and information management; and other related services. |
