MasterCard (MC) fourth quarter profits rose 28.6% year-on-year (Y/Y) but down 21.0% from the prior quarter to $801 million. Over the prior five quarters MC has averaged $848 million in quarterly profits, according to CardData.
MasterCard noted the net Q4 income of $801 million, was an increase of 17% or 21% adjusted for currency, and earnings per diluted share of $0.69, up 21% or 25% adjusted for currency, in each case versus the year-ago period and excluding the special item related to the U.S. merchant litigation taken in that period. Acquisitions had a $0.03 dilutive impact on earnings per diluted share.
MASTERCARD PROFITS HISTORICAL
Q4/13: $623 million
Q1/14: $870 million
Q2/14: $931 million
Q3/14: $1015 million
Q4/14: $801 million
Source: CardData; MasterCard
Net revenue for the fourth quarter of 2014 was $2.4 billion, a 14% increase versus the same period in 2013 as-reported and 17% increase adjusted for currency. Net revenue growth was driven by the impact of the following: an increase in cross-border volumes of 19%; a 13% increase in gross dollar volume, on a local currency basis, to $1.2 trillion; and an increase in processed transactions of 11%, to 11.6 billion.
These factors were partially offset by an increase in rebates and incentives.
Acquisitions contributed 3 percentage points to total net revenue growth.
Worldwide purchase volume during the quarter was up 12% on a local currency basis versus the fourth quarter of 2013, to $858 billion. As of December 31, 2014, the company’s customers had issued
2.1 billion MasterCard and Maestro-branded cards.
MasterCard says looking ahead will continue to drive payment innovation with solutions such as MasterPass, and by increasing electronic payments usage globally as demonstrated by its significant expanded acceptance footprint across Africa.
Total operating expenses increased 26%, or 29% adjusted for currency, to $1.4 billion, during the fourth quarter of 2014 compared to the same period in 2013, excluding that period’s special item. The primary driver of this quarter’s expense growth was an $87 million restructuring charge taken in this year’s period.
RAM Research projects MasterCard quarterly profits to hit $850 million in the first quarter.
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