Global Payments (GPN) has reported 1.79 percent fall in profit for the quarter ended Aug. 31, 2016. The company has earned $85.09 million, or $0.55 a share in the quarter, compared with $86.65 million, or $0.66 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $133.68 million, or $0.86 a share compared with $103.02 million or $0.79 a share, a year ago.
Revenue during the quarter grew 25.47 percent to $939.49 million from $748.80 million in the previous year period. Gross margin for the quarter contracted 1283 basis points over the previous year period to 50.76 percent. Total expenses were 87.11 percent of quarterly revenues, up from 81.60 percent for the same period last year. That has resulted in a contraction of 551 basis points in operating margin to 12.89 percent.
Operating income for the quarter was $121.11 million, compared with $137.77 million in the previous year period.
However, the adjusted operating income for the quarter stood at $240.72 million compared to $163.57 million in the prior year period. At the same time, adjusted operating margin improved 378 basis points in the quarter to 25.62 percent from 21.84 percent in the last year period.
"Our fiscal 2017 is off to a terrific start, with organic growth accelerating sequentially across our key markets in the first quarter," said Jeff Sloan, chief executive officer. "Heartland continued its strong growth momentum in the United States. Our businesses in Europe performed exceptionally well, and our Asia business produced its highest rate of organic revenue growth in several quarters.” Sloan concluded, “We also could not be more pleased with our Heartland integration efforts, which continue to track ahead of our expectations."
For financial year 2017, Global Payments expects revenue to be in the range of $3,700 million to $3,800 million. Global Payments expects adjusted revenue to be in the range of $3,200 million to $3,300 million. The company projects diluted earnings per share to be in the range of $1.88 to $1.98, the company projects diluted earnings per share to be in the range of $3.45 to $3.55 on adjusted basis.
Operating cash flow drops significantlyGlobal Payments has generated cash of $155.67 million from operating activities during the quarter, down 69.68 percent or $ 357.72 million, when compared with the last year period. The company has spent $38.23 million cash to meet investing activities during the quarter as against cash outgo of $258.39 million in the last year period.
The company has spent $175.07 million cash to carry out financing activities during the quarter as against cash outgo of $90.12 million in the last year period.
Cash and cash equivalents stood at $977.78 million as on Aug. 31, 2016, up 21.72 percent or $174.47 million from $803.31 million on Aug. 31, 2015.
Working capital decreases marginally
Global Payments has witnessed a decline in the working capital over the last year. It stood at $352.66 million as at Aug. 31, 2016, down 1.16 percent or $4.14 million from $356.80 million on Aug. 31, 2015. Current ratio was at 1.16 as on Aug. 31, 2016, up from 1.15 on Aug. 31, 2015.
Days sales outstanding went down to 24 days for the quarter compared with 26 days for the same period last year.
Debt increases substantiallyGlobal Payments has witnessed an increase in total debt over the last one year. It stood at $4,803.76 million as on Aug. 31, 2016, up 109.89 percent or $2,515.05 million from $2,288.70 million on Aug. 31, 2015. Total debt was 46.92 percent of total assets as on Aug. 31, 2016, compared with 41.82 percent on Aug. 31, 2015. Debt to equity ratio was at 1.65 as on Aug. 31, 2016, down from 2.50 as on Aug. 31, 2015. Interest coverage ratio deteriorated to 2.81 for the quarter from 10.40 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
