MasterCard Reports Profit, Sales Growth -- Update
30 January 2016 - 1:18AM
Dow Jones News
By Chelsey Dulaney
Payment-card network MasterCard Inc. on Friday reported an 11%
increase in fourth-quarter profit, though its revenue was below
Wall Street forecasts as rebates and incentives again ate into
growth.
Shares fell 0.4% to $83.11 a share in premarket trading.
The Purchase, N.Y.-based company's results recently have been
pressured across the world from a strong U.S. dollar, particularly
when compared with the euro and the Brazilian real. Slower growth
in emerging markets and worsening economic conditions in Venezuela
have also impacted results.
"Entering 2016, while uncertainty in the global economy
persists, the fundamentals of our business and our approach remain
unchange," said Chief Executive Ajay Banga in a news release.
For the period ended Dec. 31, the company posted earnings of
$890 million, or 79 cents a share, compared with $801 million, or
69 cents a share, a year earlier.
Revenue grew 4.4% to $2.52 billion, or 9% excluding currency
impacts. Analysts had projected 69 cents a share in profit and
$2.55 billion in revenue, according to Thomson Reuters.
The company said that while an increase in rebates and
incentives ate into revenue, acquisitions added 2 percentage points
to revenue growth.
Like rival Visa Inc. , MasterCard processes electronic payments
on its network, but doesn't collect interest or set interest
rates.
In the latest quarter, purchase volume grew 12%, on a
constant-currency basis, to $883 billion. Both processed
transactions and cross-border volumes grew 12%.
Gross dollar volume grew 12%, in terms of local currency, to
$1.2 trillion.
On Thursday, Visa reported a 24% increase in profit as the
company posted increases in payments volume and processed
transactions.
But the company warned that the uneven global economy and the
effects of the stronger U.S. dollar could weigh on its results for
the year.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
(END) Dow Jones Newswires
January 29, 2016 09:03 ET (14:03 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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