Heartland Payment Systems, Inc
) delivered operating net income of 62 cents per share in the
third quarter of 2013, surpassing the Zacks Consensus Estimate of
56 cents by 11%. Earnings were 26% higher from 49 cents earned in
the prior-year quarter.
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Including acquisition-related amortization of 4 cents, net income
came in at 58 cents per share, up 23% year over year.
Behind the headlines
Heartland Payment generated total revenues of $557 million, up 5%
year over year. However, results lagged the Zacks Consensus
Estimate of $568 million by about 2%.
Net revenues were $153.2 million, increasing 9.5% year over year.
The improvement was largely fuelled by solid growth in card
processing, surge in Payroll, solid contribution from Campus
Solutions and a substantial improvement in Micropayments.
Total expenses of Heartland Payment were $552.2 million, up 4.9%
year over year, attributable to increase in general and
Operating margin on net revenues contracted 60 basis points (bps)
year over year to 22.8% in the reported quarter.
Small and mid-sized enterprise (SME) quarterly transaction
processing volume was $19.6 billion, up 3.9% year over year in
the reported quarter. The upside was driven by new card margin
installed that increased 9% and same store sales improving 1.6%.
Volume attrition was 13% in the reported quarter.
Heartland Payment exited the quarter with $67.2 million in cash
and cash equivalents, improving from $48.4 million at the 2012
Long term borrowings decreased to $35 million at quarter-end from
$50 million at 2012-end.
Cash from operations of Heartland Payment declined to $87.4
million in the first nine months of 2013 from $98.8 million in
the year-ago period.
Dividend and Share Repurchase Update
Heartland Payment spent $6 million to buy back 0.2 million shares
in the third quarter. The company is left with nearly $64.6
million remaining under its existing repurchase authorization.
The board of directors of Heartland Payment approved a quarterly
dividend of 7 cents per share. The dividend will be paid on Dec
13, 2013 to shareholders of record as on Nov 22, 2013.
Heartland Payment expects to generate net revenues in the range
of $600 million and $605 million. Net earnings are expected to be
between $2.30 and $2.33 per share. This includes 37 cents per
share related to acquisition-related amortization and share-based
compensation expense, and about 4 cents of proportionate losses
on the consolidation of Leaf.
Performance of other financial transaction service
) reported third-quarter 2013 operating earnings per share of
$7.27. The results significantly outpaced the Zacks Consensus
Estimate of $6.95 and the year-ago quarter figure of $6.17 per
) fiscal fourth-quarter 2013 (ended Sep 30, 2013) operating
earnings of $1.85 per Class A common share were in line with the
Zacks Consensus Estimate. The figure nevertheless, outpaced the
prior-year quarter figure of $1.54 per share.
Alliance Data Systems Corporation
) reported adjusted earnings of $2.67 per share in the third
quarter of 2013. The earnings lagged the Zacks Consensus Estimate
by a penny but were ahead of the year-ago figure by 15.6%.
Heartland Payment presently carries a Zacks Rank #3 (Hold).