NJ-based Heartland Payment Systems (HPS) reported Small and Mid-Sized Enterprise (SME) Q3 transaction processing volume set a new quarterly record $24.5 billion, up 13.1% year-on-year (YOY). HPS also acquired privately held Digital Dining, a provider of restaurant point-of-sale (POS) and management systems throughout the USA.
Robert O. Carr, Chairman and CEO, said, “The strong momentum in new margin installed, transaction processing and net revenue growth continues to drive record earnings. Our new business growth was outstanding this quarter, with new margin installed up nearly 30%, one of the fastest rates of new business growth in many years, and this growth was accomplished from a much higher base.”
SME card transaction processing volume for the quarter was up 13.1% compared to the third quarter of 2014, driven by new margin installs, growth in same store sales and improved net volume attrition. SME card transaction processing volume in both the third quarters of 2015 and 2014 includes Visa, MasterCard, Discover and Amex OptBlue, the latter of which we first began including in volume in the third quarter of 2014. Total non-card segments grew their revenue by 61% for the quarter as a result of both organic and acquisition related growth.
For full year 2015, HPS expect to deliver Net Revenue growth in excess of 20%, to between approximately $810 million and $815 million, and adjusted EPS to be in the range of $2.86 – $2.89. Guidance assumes after-tax share-based compensation and acquisition-related amortization expenses reduce earnings per share by $0.65 for the year and an approximate 39% tax rate.
Headquartered in Springfield, Virginia, Digital Dining offers restaurants the convenience of a handheld POS on an iPad, iPhone, iPod and iPad Mini in a hybrid environment with conventional fixed terminals. Digital Dining is also used by restaurateurs for table management, delivery, reservations, labor scheduling, inventory and loyalty programs.
• With this acquisition of Digital Dining, Heartland advances its strategy of growing its commerce segment. Previously, the company acquired pcAmerica and Dinerware in February 2015 and XPIENT Solutions and LiquorPOS in 2014. The company will continue seeking profitable acquisitions to support its strategy.
• Digital Dining, together with Heartland’s existing POS businesses of pcAmerica, Dinerware, XPIENT Solutions, LiquorPOS and other Heartland solutions, comprise Heartland Commerce. This segment delivers leading-edge, secure POS solutions, payments processing capabilities and other adjacent business service applications, initially serving the hospitality and retail industries.
• Heartland has more than 100,000 customer locations using its Heartland Commerce software.
• With more than 130,000 restaurant merchant relationships, Heartland has approximately 18 percent share of the entire restaurant market, including close to 24 percent share of table service restaurants, according to CHD Expert.
• From payroll to gift cards and loyalty to card processing to POS solutions, Heartland has rapidly expanded its restaurant vertical business, supported by the endorsements of 45 state restaurant associations, the Council of State Restaurants Associations and the National Restaurant Association.
• Heartland will substantially retain all Digital Dining employees and they will join the Heartland Commerce business group.
• Menusoft, Digital Dining’s first product, was introduced in the U.S. in 1984. The first Digital Dining POS system was installed that same year at a Washington D.C. tavern with three workstations.
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