GLOBAL PAYMENTS INC - FORM 8-K - EX-99.1 - PRESS RELEASE

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8-K - FORM 8-K - GLOBAL PAYMENTS INC	d328391d8k.htm

Exhibit 99.1

LOGO

Contact: Jane M. Elliott

770-829-8234 Voice

770-829-8267 Fax

investor.relations@globalpay.com

Global Payments Reports Third Quarter Earnings

ATLANTA, April 2, 2012 — Global Payments Inc. (NYSE: GPN) today announced results for its fiscal third quarter ended February 29, 2012. For the third quarter, revenues grew 17% to $533.5 million compared to $456.4 million in the prior fiscal year. Cash earnings per share grew 17% to $0.83 compared to $0.71 in the prior year (See Schedule 2 for Cash Earnings). On a GAAP basis, the company reported fiscal 2012 third quarter diluted earnings per share growth of 24% to $0.73 compared to $0.59 in the prior year (See Schedule 1 for GAAP Consolidated Statements of Income).

Chairman and CEO Paul R. Garcia stated, “We delivered solid third quarter results driven by continued steady performances in our US and International businesses.”

David E. Mangum, Senior Executive Vice President and CFO, stated, “We continue to expect our annual revenue for fiscal 2012 to be $2,150 million to $2,200 million, or 16% to 18% growth over fiscal 2011 and fiscal 2012 diluted earnings per share on a cash basis to be a range of $3.50 to $3.58, reflecting 14% to 16% growth over fiscal 2011. We now expect GAAP diluted earnings per share of $3.10 to $3.18 representing 19% to 22% growth over the prior year and reflecting some planned cost saving initiatives for our fourth quarter.” (See Schedule 9 for Outlook Summary.)

Cash earnings exclude normalized adjustments and acquisition intangible amortization expense from continuing operations. (See Schedule 6 and 7 for Reconciliations of Cash Earnings to GAAP, Schedule 2 for Cash Earnings and Schedule 3 for Segment Information on GAAP and Cash Earnings).

—More—

GPN Reports Third Quarter Earnings

April 2, 2012

Page 2

Conference Call

Global Payments will discuss financial results and business highlights on today’s scheduled call, April 2, 2012 at 8:00 a.m. EDT. Callers may access the conference call via the investor relations page of the Company’s Web site at www.globalpaymentsinc.com by clicking the “Webcast” button; or callers in North America may dial 1-888-895-3550 and callers outside North America may dial 1-706-758-8809. The pass code is “GPN.” A replay of the call may be accessed through the Global Payments Web site through April 18, 2012.

Global Payments Inc. (NYSE:GPN) is a leading provider of electronic transaction processing services for merchants, Independent Sales Organizations (ISOs), financial institutions, government agencies and multi-national corporations located throughout the United States, Canada, Europe and the Asia-Pacific region. Global Payments, a Fortune 1000 company, offers a comprehensive line of processing solutions for credit and debit cards, business-to-business purchasing cards, gift cards, electronic check conversion and check guarantee, verification and recovery including electronic check services, as well as terminal management. Visit www.globalpaymentsinc.com for more information about the company and its services.

This announcement and comments made by Global Payments’ management during the conference call may contain certain forward-looking statements within the meaning of the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including revenue and earnings estimates and management’s expectations regarding future events and developments, are forward-looking statements and are subject to significant risks and uncertainties. Important factors that may cause actual events or results to differ materially from those anticipated by such forward-looking statements include the following:the results of the investigation of the unauthorized access of a portion of our processing system announced on March 30, 2012, and the impact on our results of operations; foreign currency risks which become increasingly relevant as we expand internationally, the effect of current worldwide economic conditions, including sovereign insolvency situations and a decline in the value of the U.S. dollar, developments in the implementation of debit interchange legislation, and future performance and integration of recent acquisitions, and other risks detailed in the company’s SEC filings, including the most recently filed Form 10-Q or Form 10-K, as applicable. The company undertakes no obligation to revise any of these statements to reflect future circumstances or the occurrence of unanticipated events.

###

SCHEDULE 1

UNAUDITED GAAP CONSOLIDATED STATEMENTS OF INCOME

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In thousands, except per share data)
	Three Months Ended									Nine Months Ended
	February 29, 2012			February 28, 2011			% Change			February 29, 2012			February 28, 2011			% Change
Revenues	$	533,539		$	456,382			17	%	$	1,606,815		$	1,340,047			20	%

Operating expenses:
Cost of service		194,218			168,332			15	%		571,685			473,578			21	%
Sales, general and administrative		246,973			209,851			18	%		737,593			623,019			18	%

		441,191			378,183			17	%		1,309,278			1,096,597			19	%

Operating income		92,348			78,199			18	%		297,537			243,450			22	%

Other income (expense):
Interest and other income		2,368			1,631			45	%		7,128			7,239			(2	%)
Interest and other expense		(3,698	)		(4,315	)		(14	%)		(12,663	)		(13,455	)		(6	%)

		(1,330	)		(2,684	)		(50	%)		(5,535	)		(6,216	)		(11	%)

Income from continuing operations before income taxes		91,018			75,515			21	%		292,002			237,234			23	%
Provision for income taxes		(25,328	)		(20,962	)		21	%		(86,082	)		(70,489	)		22	%

Income from continuing operations		65,690			54,553			20	%		205,920			166,745			23	%
Loss from discontinued operations, net of tax		—			(430	)		NM			—			(946	)		NM

Net income including noncontrolling interests		65,690			54,123			21	%		205,920			165,799			24	%
Less: Net income attributable to noncontrolling interests, net of tax		(7,770	)		(6,334	)		23	%		(22,845	)		(15,138	)		51	%

Net income attributable to Global Payments	$	57,920		$	47,789			21	%	$	183,075		$	150,661			22	%

Amounts attributable to Global Payments:
Income from continuing operations	$	57,920		$	48,219			20	%	$	183,075		$	151,607			21	%
Loss from discontinued operations, net of tax		—			(430	)		NM			—			(946	)		NM

Net income attributable to Global Payments	$	57,920		$	47,789			21	%	$	183,075		$	150,661			22	%

Basic earnings per share attributable to Global Payments:
Income from continuing operations	$	0.74		$	0.60			23	%	$	2.32		$	1.90			22	%
Loss from discontinued operations, net of tax		—			—			NM			—			(0.01	)		NM

Net income attributable to Global Payments	$	0.74		$	0.60			23	%	$	2.32		$	1.89			23	%

Diluted earnings per share attributable to Global Payments:
Income from continuing operations	$	0.73		$	0.60			22	%	$	2.30		$	1.89			22	%
Loss from discontinued operations, net of tax		—			(0.01	)		NM			—			(0.02	)		NM

Net income attributable to Global Payments	$	0.73		$	0.59			24	%	$	2.30		$	1.87			23	%

Weighted average shares outstanding:
Basic		78,421			79,897						78,937			79,711
Diluted		79,065			80,733						79,511			80,413

NM - Not Meaningful

SCHEDULE 2

CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In thousands, except per share data)
	Three Months Ended									Nine Months Ended
	February 29, 2012			February 28, 2011			% Change			February 29, 2012			February 28, 2011			% Change
Revenues	$	533,539		$	456,382			17	%	$	1,606,815		$	1,340,047			20	%

Operating expenses:
Cost of service		181,338			156,082			16	%		534,009			444,031			20	%
Sales, general and administrative		246,973			206,694			19	%		737,593			614,340			20	%

		428,311			362,776			18	%		1,271,602			1,058,371			20	%

Operating income		105,228			93,606			12	%		335,213			281,676			19	%

Other income (expense):
Interest and other income		2,368			1,631			45	%		7,128			7,239			(2	%)
Interest and other expense		(3,698	)		(4,315	)		(14	%)		(12,663	)		(13,455	)		(6	%)

		(1,330	)		(2,684	)		(50	%)		(5,535	)		(6,216	)		(11	%)

Income from continuing operations before income taxes		103,898			90,922			14	%		329,678			275,460			20	%
Provision for income taxes		(28,912	)		(25,214	)		15	%		(97,163	)		(80,027	)		21	%

Income from continuing operations including noncontrolling interests		74,986			65,708			14	%		232,515			195,433			19	%
Less: Net income attributable to noncontrolling interests, net of tax		(9,671	)		(8,121	)		19	%		(28,756	)		(17,561	)		64	%

Net income from continuing operations attributable to Global Payments	$	65,315		$	57,587			13	%	$	203,759		$	177,872			15	%

Basic earnings per share	$	0.83		$	0.72			15	%	$	2.58		$	2.23			16	%

Diluted earnings per share	$	0.83		$	0.71			17	%	$	2.56		$	2.21			16	%

Weighted average shares outstanding:
Basic		78,421			79,897						78,937			79,711
Diluted		79,065			80,733						79,511			80,413

NM - Not Meaningful

See Schedules 6 and 7 for a reconciliation of cash earnings from continuing operations to GAAP.

SCHEDULE 3

SEGMENT INFORMATION

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands)


	Three Months Ended
	February 29, 2012						February 28, 2011						% Change
	GAAP			Cash Earnings			GAAP			Cash Earnings			GAAP			Cash Earnings
Revenues:
United States	$	302,105		$	302,105		$	249,194		$	249,194			21	%		21	%
Canada		76,677			76,677			81,066			81,066			(5	%)		(5	%)

North America merchant services		378,782			378,782			330,260			330,260			15	%		15	%
Europe		116,196			116,196			90,531			90,531			28	%		28	%
Asia-Pacific		38,561			38,561			35,591			35,591			8	%		8	%

International merchant services		154,757			154,757			126,122			126,122			23	%		23	%

Total revenues	$	533,539		$	533,539		$	456,382		$	456,382			17	%		17	%

Operating income:
North America merchant services	$	62,462		$	65,697		$	62,916		$	66,122			(1	%)		(1	%)
International merchant services		47,911			57,556			35,537			44,171			35	%		30	%
Corporate		(18,025	)		(18,025	)		(20,254	)		(16,687	)		11	%		(8	%)

Operating income	$	92,348		$	105,228		$	78,199		$	93,606			18	%		12	%


	Nine Months Ended
	February 29, 2012						February 28, 2011						% Change
	GAAP			Cash Earnings			GAAP			Cash Earnings			GAAP			Cash Earnings
Revenues:
United States	$	882,946		$	882,946		$	750,495		$	750,495			18	%		18	%
Canada		253,419			253,419			243,733			243,733			4	%		4	%

North America merchant services		1,136,365			1,136,365			994,228			994,228			14	%		14	%
Europe		360,779			360,779			244,208			244,208			48	%		48	%
Asia-Pacific		109,671			109,671			101,611			101,611			8	%		8	%

International merchant services		470,450			470,450			345,819			345,819			36	%		36	%

Total revenues	$	1,606,815		$	1,606,815		$	1,340,047		$	1,340,047			20	%		20	%

Operating income:
North America merchant services	$	204,893		$	213,808		$	198,415		$	207,793			3	%		3	%
International merchant services		148,063			176,824			102,279			120,387			45	%		47	%
Corporate		(55,419	)		(55,419	)		(57,244	)		(46,504	)		3	%		(19	%)

Operating income	$	297,537		$	335,213		$	243,450		$	281,676			22	%		19	%

See Schedule 8 for reconciliation of cash earnings segment information to GAAP.

SCHEDULE 4

CONSOLIDATED BALANCE SHEETS

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In thousands)
	February 29,			May 31,
	2012			2011
		(unaudited	)
ASSETS
Current assets:
Cash and cash equivalents	$	735,733		$	1,354,285
Accounts receivable, net of allowances for doubtful accounts of $424 and $472, respectively		156,038			166,540
Claims receivable, net of allowance for losses of $4,417 and $3,870, respectively		1,153			914
Settlement processing assets		179,515			280,359
Inventory		12,380			7,640
Deferred income taxes		3,943			2,946
Prepaid expenses and other current assets		37,737			35,291

Total current assets		1,126,499			1,847,975

Goodwill		760,972			779,637
Other intangible assets, net of accumulated amortization of $230,173 and $197,066, respectively		318,843			341,500
Property and equipment, net of accumulated depreciation of $176,696 and $147,670, respectively		288,428			256,301
Deferred income taxes		98,585			104,140
Other		23,644			20,978

Total assets	$	2,616,971		$	3,350,531

LIABILITIES AND EQUITY
Current liabilities:
Lines of credit	$	215,716		$	270,745
Current portion of long-term debt		82,505			85,802
Accounts payable and accrued liabilities		213,613			241,578
Settlement processing obligations		221,247			838,565
Income taxes payable		19,289			7,674

Total current liabilities		752,370			1,444,364

Long-term debt		177,846			268,217
Deferred income taxes		120,748			116,432
Other long-term liabilities		56,803			49,843

Total liabilities		1,107,767			1,878,856

Commitments and contingencies

Redeemable noncontrolling interest		141,897			133,858

Equity:
Preferred stock, no par value; 5,000,000 shares authorized and none issued		—			—
Common stock, no par value; 200,000,000 shares authorized; 78,545,273 issued and outstanding at February 29, 2012 and 80,334,781 issued and outstanding at May 31, 2011		—			—
Paid-in capital		354,191			419,591
Retained earnings		842,487			685,624
Accumulated other comprehensive income		33,299			79,320

Total Global Payments shareholders’ equity		1,229,977			1,184,535

Noncontrolling interest		137,330			153,282

Total equity		1,367,307			1,337,817

Total liabilities and equity	$	2,616,971		$	3,350,531

SCHEDULE 5

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In thousands)
	Nine Months Ended
	February 29, 2012			February 28, 2011
Cash flows from operating activities:
Net income including noncontrolling interests	$	205,920		$	165,799
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization of property and equipment		35,821			29,033
Amortization of acquired intangibles		37,676			27,486
Provision for operating losses and bad debts		18,833			15,301
Share-based compensation expense		12,796			11,748
Deferred income taxes		5,858			3,639
Loss on disposal of discontinued operations		—			602
Other, net		(949	)		(3,362	)
Changes in operating assets and liabilities, net of the effects of acquisitions:
Accounts receivable		10,502			(5,836	)
Claims receivable		(11,744	)		(11,534	)
Settlement processing assets and obligations, net		(523,802	)		444,174
Inventory		(4,773	)		(69	)
Prepaid expenses and other assets		(2,388	)		(7,997	)
Accounts payable and other accrued liabilities		(22,211	)		45,182
Income taxes payable		11,615			19,125

Net cash (used in) provided by operating activities		(226,846	)		733,291

Cash flows from investing activities:
Business, intangible and other asset acquisitions, net of cash acquired		(44,245	)		(167,775	)
Capital expenditures		(71,084	)		(77,095	)
Preliminary settlement of working capital adjustments from disposition of business		—			(1,921	)
Net decrease in financing receivables		1,862			1,514

Net cash used in investing activities		(113,467	)		(245,277	)

Cash flows from financing activities:
Net (payments) borrowings on lines of credit		(55,029	)		109,774
Proceeds from issuance of long-term debt		71,374			202,155
Principal payments under long-term debt		(162,482	)		(248,996	)
Proceeds from stock issued under employee stock plans		9,630			12,072
Common stock repurchased - share-based compensation plans		(4,847	)		—
Repurchase of common stock		(99,604	)		(14,900	)
Tax benefit from employee share-based compensation		2,036			1,335
Distribution to noncontrolling interests		(24,334	)		(6,650	)
Dividends paid		(4,740	)		(4,782	)

Net cash (used in) provided by financing activities		(267,996	)		50,008

Effect of exchange rate changes on cash		(10,243	)		21,097

Decrease in cash and cash equivalents		(618,552	)		559,119
Cash and cash equivalents, beginning of period		1,354,285			769,946

Cash and cash equivalents, end of period	$	735,733		$	1,329,065

SCHEDULE 6

RECONCILIATION OF QUARTERLY CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS TO GAAP

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In thousands, except per share data)
	Three Months Ended February 29, 2012
	GAAP								Cash Earnings Adjustments¹			Cash Earnings
Revenues	$	533,539							$	—		$	533,539

Operating expenses:
Cost of service		194,218								(12,880	)		181,338
Sales, general and administrative		246,973								—			246,973

		441,191								(12,880	)		428,311

Operating income		92,348								12,880			105,228

Other income (expense):
Interest and other income		2,368								—			2,368
Interest and other expense		(3,698	)							—			(3,698	)

		(1,330	)							—			(1,330	)

Income from continuing operations before income taxes		91,018								12,880			103,898
Provision for income taxes		(25,328	)							(3,584	)		(28,912	)

Income from continuing operations		65,690								9,296			74,986
Less: Net income attributable to noncontrolling interests, net of tax		(7,770	)							(1,901	)		(9,671	)

Net income from continuing operations attributable to Global Payments	$	57,920							$	7,395		$	65,315

Diluted shares		79,065											79,065
Diluted earnings per share	$	0.73							$	0.10		$	0.83


	Three Months Ended February 28, 2011
	GAAP			Employee Termination and Other²			Foreign Tax Rate		Cash Earnings Adjustments¹			Cash Earnings
Revenues	$	456,382		$	—		$	—	$	—		$	456,382

Operating expenses:
Cost of service		168,332			(410	)		—		(11,840	)		156,082
Sales, general and administrative		209,851			(3,157	)		—		—			206,694

		378,183			(3,567	)		—		(11,840	)		362,776

Operating income		78,199			3,567			—		11,840			93,606

Other income (expense):
Interest and other income		1,631			—			—		—			1,631
Interest and other expense		(4,315	)		—			—		—			(4,315	)

		(2,684	)		—			—		—			(2,684	)

Income from continuing operations before income taxes		75,515			3,567			—		11,840			90,922
Provision for income taxes		(20,962	)		(765	)				(3,487	)		(25,214	)

Income from continuing operations		54,553			2,802			—		8,353			65,708
Less: Net income attributable to noncontrolling interests, net of tax		(6,334	)		—			—		(1,787	)		(8,121	)

Net income from continuing operations attributable to Global Payments	$	48,219		$	2,802		$	—	$	6,566		$	57,587

Diluted shares		80,733											80,733
Diluted earnings per share	$	0.60		$	0.03		$	—	$	0.08		$	0.71

¹	Represents adjustments to cost of service to exclude acquisition intangible amortization expense from continuing operations and the related income tax benefit.

²	Reflects expenses of start-up costs related to our new Global Service Center in Manila, Philippines and employee termination and relocation benefits and the related income tax benefits.

We supplemented our reporting of income from continuing operations and the related earnings per share information determined in accordance with GAAP by reporting income from continuing operations and the related earnings per share for the three months ended February 29, 2012 and February 28, 2011 on a “cash earnings” basis in this earnings release as a measure to help evaluate performance. We calculated February 29, 2012 income from continuing operations and earnings per share on a cash basis by excluding acquisition intangible amortization from our results. We calculated February 28, 2011 income from continuing operations and earnings per share on a cash basis by excluding charges related to employee termination and relocation benefits, certain one-time costs related to our Global Service Center, and acquisition intangible amortization from our results. We exclude these charges in order to more clearly focus on the factors we believe are pertinent to the daily management of our operations. Our income from continuing operations and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, income from continuing operations and earnings per share determined in accordance with GAAP. Our measures of income from continuing operations and earnings per share on a cash earnings basis reflect management’s judgment of particular items, and may not be comparable to similarly titled measures reported by other companies.

SCHEDULE 7

RECONCILIATION OF YEAR TO DATE CASH EARNINGS ATTRIBUTABLE TO GLOBAL PAYMENTS TO GAAP

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In thousands, except per share data)
	Nine Months Ended February 29, 2012
	GAAP								Cash Earnings Adjustments¹			Cash Earnings
Revenues	$	1,606,815							$	—		$	1,606,815

Operating expenses:
Cost of service		571,685								(37,676	)		534,009
Sales, general and administrative		737,593								—			737,593

		1,309,278								(37,676	)		1,271,602

Operating income		297,537								37,676			335,213

Other income (expense):
Interest and other income		7,128								—			7,128
Interest and other expense		(12,663	)							—			(12,663	)

		(5,535	)							—			(5,535	)

Income from continuing operations before income taxes		292,002								37,676			329,678
Provision for income taxes		(86,082	)							(11,081	)		(97,163	)

Income from continuing operations		205,920								26,595			232,515
Less: Net income attributable to noncontrolling interests, net of tax		(22,845	)							(5,911	)		(28,756	)

Net income from continuing operations attributable to Global Payments	$	183,075							$	20,684		$	203,759

Diluted shares		79,511											79,511
Diluted earnings per share	$	2.30							$	0.26		$	2.56


	Nine Months Ended February 28, 2011
	GAAP			Employee Termination and Other²			Foreign Tax Rate³		Cash Earnings Adjustments¹			Cash Earnings
Revenues	$	1,340,047		$	—		$	—	$	—		$	1,340,047

Operating expenses:
Cost of service		473,578			(2,061	)		—		(27,486	)		444,031
Sales, general and administrative		623,019			(8,679	)		—		—			614,340

		1,096,597			(10,740	)		—		(27,486	)		1,058,371

Operating income		243,450			10,740			—		27,486			281,676

Other income (expense):
Interest and other income		7,239			—			—		—			7,239
Interest and other expense		(13,455	)		—			—		—			(13,455	)

		(6,216	)		—			—		—			(6,216	)

Income from continuing operations before income taxes		237,234			10,740			—		27,486			275,460
Provision for income taxes		(70,489	)		(3,384	)		2,479		(8,633	)		(80,027	)

Income from continuing operations		166,745			7,356			2,479		18,853			195,433
Less: Net income attributable to noncontrolling interests, net of tax		(15,138	)		—			—		(2,423	)		(17,561	)

Net income from continuing operations attributable to Global Payments	$	151,607		$	7,356		$	2,479	$	16,430		$	177,872

Diluted shares		80,413											80,413
Diluted earnings per share	$	1.89		$	0.09		$	0.03	$	0.20		$	2.21

¹	Represents adjustments to cost of service to exclude acquisition intangible amortization expense from continuing operations and the related income tax benefit.

²	Reflects expenses of start-up costs related to our new Global Service Center in Manila, Philippines and employee termination and relocation benefits and the related income tax benefits.

³	Represents a one-time, non-cash write-down of a deferred tax asset we established in July 2009 when we purchased the remaining 49% of our UK business. The write-down resulted from a legislated reduction to the tax rate of 1%.

We supplemented our reporting of income from continuing operations and the related earnings per share information determined in accordance with GAAP by reporting income from continuing operations and the related earnings per share for the nine months ended February 29, 2012 and February 28, 2011 on a “cash earnings” basis in this earnings release as a measure to help evaluate performance. We calculated February 29, 2012 income from continuing operations and earnings per share on a cash basis by excluding acquisition intangible amortization from our results. We calculated February 28, 2011 income from continuing operations and earnings per share on a cash basis by excluding charges related to employee termination and relocation benefits, certain one-time costs related to our Global Service Center, the legislated tax rate reduction and acquisition intangible amortization from our results. We exclude these charges in order to more clearly focus on the factors we believe are pertinent to the daily management of our operations. Our income from continuing operations and earnings per share reported on a cash earnings basis should be considered in addition to, and not as a substitute for, income from continuing operations and earnings per share determined in accordance with GAAP. Our measures of income from continuing operations and earnings per share on a cash earnings basis reflect management’s judgment of particular items, and may not be comparable to similarly titled measures reported by other companies.

SCHEDULE 8

RECONCILIATION OF CASH EARNINGS SEGMENT INFORMATION TO GAAP

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In thousands)
	Three Months Ended February 29, 2012								Three Months Ended February 28, 2011
	GAAP			Cash Earnings Adjustments¹		Cash Earnings			GAAP			Employee Termination and Other²		Cash Earnings Adjustments¹		Cash Earnings
Revenues:
United States	$	302,105		$	—	$	302,105		$	249,194		$	—	$	—	$	249,194
Canada		76,677			—		76,677			81,066			—		—		81,066

North America merchant services		378,782			—		378,782			330,260			—		—		330,260
Europe		116,196			—		116,196			90,531			—		—		90,531
Asia-Pacific		38,561			—		38,561			35,591			—		—		35,591

International merchant services		154,757			—		154,757			126,122			—		—		126,122

Total revenues	$	533,539		$	—	$	533,539		$	456,382		$	—	$	—	$	456,382

Operating income:
North America merchant services	$	62,462		$	3,235	$	65,697		$	62,916		$	—	$	3,206	$	66,122
International merchant services		47,911			9,645		57,556			35,537			—		8,634		44,171
Corporate		(18,025	)		—		(18,025	)		(20,254	)		3,567		—		(16,687	)

Operating income	$	92,348		$	12,880	$	105,228		$	78,199		$	3,567	$	11,840	$	93,606


	Nine Months Ended February 29, 2012								Nine Months Ended February 28, 2011
	GAAP			Cash Earnings Adjustments¹		Cash Earnings			GAAP			Employee Termination and Other²		Cash Earnings Adjustments¹		Cash Earnings
Revenues:
United States	$	882,946		$	—	$	882,946		$	750,495		$	—	$	—	$	750,495
Canada		253,419			—		253,419			243,733			—		—		243,733

North America merchant services		1,136,365			—		1,136,365			994,228			—		—		994,228
Europe		360,779			—		360,779			244,208			—		—		244,208
Asia-Pacific		109,671			—		109,671			101,611			—		—		101,611

International merchant services		470,450			—		470,450			345,819			—		—		345,819

Total revenues	$	1,606,815		$	—	$	1,606,815		$	1,340,047		$	—	$	—	$	1,340,047

Operating income:
North America merchant services	$	204,893		$	8,915	$	213,808		$	198,415		$	—	$	9,378	$	207,793
International merchant services		148,063			28,761		176,824			102,279			—		18,108		120,387
Corporate		(55,419	)		—		(55,419	)		(57,244	)		10,740		—		(46,504	)

Operating income	$	297,537		$	37,676	$	335,213		$	243,450		$	10,740	$	27,486	$	281,676

¹	Represents acquisition intangible amortization expense.

²	Represents start-up costs related to our Global Service Center in Manila, Philippines and expenses related to employee termination and relocation benefits.

SCHEDULE 9

OUTLOOK SUMMARY

GLOBAL PAYMENTS INC. AND SUBSIDIARIES


(In millions, except per share data)
	Fiscal 2011 Actual		Fiscal 2012 Outlook		% Change FY11
Revenue Outlook
Revenues	$	1,860	$	2,150 to $2,200		16% to 18%

EPS Outlook
GAAP diluted EPS	$	2.61	$	3.10 to $3.18		19% to 22%
Acquisition-related intangibles and non-recurring items ¹		0.47	$	0.40		—

Cash EPS	$	3.08	$	3.50 to $3.58		14% to 16%

¹	Fiscal 2012 reflects $0.36 of acquisition-related intangibles and $0.04 of non-recurring items. Acquisition-related intangibles accounted for $0.31 in fiscal 2011 and non-recurring items $0.16.

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