Visa Inc. Fiscal Second Quarter 2015 Financial Results April 30, 2015 Exhibit 99.2 |
Fiscal Second Quarter 2015 Financial Results 2 This presentation contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are identified by words such as "estimates," "expectation," “outlook,” "will," "continued" and other similar expressions. Examples of forward-looking statements include, but are not limited to, statements we make about our revenue, client incentives, operating margin, tax rate, earnings per share, free cash flow, and the growth of those items. By their nature, forward-looking statements: (i) speak only as of the date they are made; (ii) are not statements of historical fact or guarantees of future performance; and (iii) are subject to risks, uncertainties, assumptions or changes in circumstances that are difficult to predict or quantify. Therefore, actual results could differ materially and adversely from our forward-looking statements due to a variety of factors, including the following: • •rules capping debit interchange reimbursement rates and expanding financial institutions’ and merchants’ choices among debit payments networks promulgated under the Dodd-Frank Wall Street Reform and Consumer Protection Act; •increased regulation in jurisdictions outside of the United States and in other product categories; •increased government support of national payments networks outside the United States; and •increased regulation of consumer privacy, data use and security; •developments •new lawsuits, investigations or proceedings, or changes to our potential exposure in connection with pending lawsuits, investigations or proceedings; •economic factors, such as: •economic fragility in the Eurozone and in the United States; •general economic, political and social conditions in mature and emerging markets globally; •general stock market fluctuations, which may impact consumer spending; •material changes in cross-border activity, foreign exchange controls and fluctuations in currency exchange rates; •volatility in market prices for oil and natural gas; and •material changes in our financial institution clients' performance compared to our estimates; • • •disruption of our transaction processing systems or the inability to process transactions efficiently; •account data breaches or increased fraudulent or other illegal activities involving Visa-branded cards or payment products; and •failure to maintain systems interoperability with Visa Europe; • • • • Forward-Looking Statements various other factors, including those contained in our Annual Report on Form 10-K for the year ended September 30, 2014, and our other filings with the U.S. Securities and Exchange Commission. You should not place undue reliance on such statements. Except as required by law, we do not intend to update or revise any forward–looking statements as a result of new information, future developments or otherwise. the impact of laws, regulations and marketplace barriers, including: in litigation and government enforcement, including those affecting interchange reimbursement fees, antitrust and tax; industry developments, such as competitive pressure, rapid technological developments and disintermediation from our payments network; system developments, such as: costs arising if Visa Europe were to exercise its right to require us to acquire all of its outstanding stock; the loss of organizational effectiveness or key employees; the failure to integrate acquisitions successfully or to effectively develop new products and businesses; natural disasters, terrorist attacks, military or political conflicts, and public health emergencies; and |
Fiscal Second Quarter 2015 Financial Results 3 Solid Fiscal Second Quarter Results Solid operating revenues of $3.4 billion, up 8% over prior year Repurchased 16.2 million shares of class A common stock in the open market at an average price of $64.84 per share, using $1.1 billion of cash on hand Continued positive secular trends and spending momentum contributed to growth in key underlying business drivers Quarterly net income of $1.6 billion and diluted earnings per share of $0.63 Note: All per share amounts presented reflect the company’s four-for-one class A common stock split effected March 19, 2015. |
Fiscal Second Quarter 2015 Financial Results 4 Quarter ended December Payments Volume US$ in billions, nominal, except percentages YOY Change (constant) 11% 13% 9% YOY Change (nominal) 8% 5% 7% Note: Figures may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. On occasion, previously submitted volume information may be updated to reflect revised client submissions or other adjustments. Prior period updates are not material. Constant dollar growth rates exclude the impact of foreign currency fluctuations against the U.S. dollar in measuring performance. 2013 2014 INTL 594 INTL 468 INTL 124 INTL 127 U.S. 591 U.S. 288 U.S. 303 1,164 1,245 737 795 427 450 INTL = International Total Visa Inc. Credit Debit U.S. 651 INTL 573 U.S. 327 INTL 450 U.S. 323 |
Fiscal Second Quarter 2015 Financial Results 5 Quarter ended March Payments Volume US$ in billions, nominal, except percentages YOY Change (constant) 11% 13% 8% YOY Change (nominal) 7% 4% 5% Note: Current quarter payments volume and other select metrics are provided in the operational performance data supplement in the press release to provide more recent operating data. Service revenues continue to be recognized based on payments volume in the prior quarter. On occasion, reported payments volume information may be updated to reflect revised client submissions or other adjustments. Prior period updates are not material. Figures may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. 2014 2015 INTL 533 INTL 541 INTL 417 INTL 429 INTL 115 INTL 111 U.S. 575 U.S. 627 U.S. 269 U.S. 302 U.S. 305 U.S. 325 1,108 1,168 687 732 421 436 Total Visa Inc. Credit Debit INTL = International |
Fiscal Second Quarter 2015 Financial Results 6 Quarter ended March Transactions in millions, except percentages Note: Processed transactions represent transactions involving Visa, Visa Electron, Interlink and Plus cards processed on Visa’s networks. Total transactions represent payments and cash transactions as reported by Visa clients on their operating certificates. On occasion, previously submitted transaction information may be updated to reflect revised client submissions or other adjustments. Prior period updates are not material. Figures may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. YOY Change 10% 11% 2014 2015 37% Credit 22,742 25,082 15,354 16,980 Processed Transactions Total Transactions 63% Debit 37% Credit 63% Debit |
Fiscal Second Quarter 2015 Financial Results 7 Quarter ended December Total Cards in millions, except percentages Note: The data presented is based on results reported quarterly by Visa clients on their operating certificates. Estimates may be utilized if data is unavailable. On occasion, previously submitted card information may be updated to reflect revised client submissions or other adjustments. Prior period updates are not material. Figures may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. YOY Change 6% 10% 8% 2013 2014 2,220 811 1,409 2,403 857 1,546 Visa Inc. Credit Debit |
Fiscal Second Quarter 2015 Financial Results 8 Revenue – Q2 2015 US$ in millions, except percentages Note: Figures may not recalculate exactly due to rounding. Percentages are calculated based on unrounded numbers. YOY Change 15% 8% 9% Fiscal 2015 % of Gross Revenues 17% 83% 3,750 (587) 3,163 4,085 (676) 3,409 Gross Revenues Client Incentives Net Operating Revenues Fiscal 2014 Fiscal 2015 |
Fiscal Second Quarter 2015 Financial Results 9 Revenue Detail – Q2 2015 US$ in millions, except percentages Note: Figures may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. YOY Change 9% 11% 8% 12% 1,462 1,234 871 183 1,577 1,340 964 204 Service Revenues Data Processing Revenues International Transaction Revenues Other Revenues Fiscal 2014 Fiscal 2015 |
Fiscal Second Quarter 2015 Financial Results 10 Operating Margin – Q2 2015 US$ in millions, except percentages Note: Operating margin is calculated as operating income divided by net operating revenues. Figures may not recalculate exactly due to rounding. Percentages are calculated based on unrounded numbers. YOY Change 1% 11% 8% 2ppt 3,163 1,115 2,048 3,409 1,128 2,281 Net Operating Revenues Total Operating Expenses Operating Income Fiscal 2014 Fiscal 2015 65% 67% Operating Margin |
Fiscal Second Quarter 2015 Financial Results 11 Operating Expenses – Q2 2015 US$ in millions, except percentages Note: Figures may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. YOY Change (9%) — 8% 18% 17% (22%) NM 446 245 120 77 107 120 0 483 190 109 77 125 141 3 Personnel Marketing Network & Processing Professional Fees Depreciation & Amortization General & Administrative Litigation Provision Fiscal 2014 Fiscal 2015 |
Fiscal Second Quarter 2015 Financial Results 12 Other Financial Results • Cash, cash equivalents and available-for-sale investment securities of $7.3 billion at the end of the fiscal second quarter • Free cash flow of $1.0 billion for the fiscal second quarter • Capital expenditures of $98 million during the fiscal second quarter • Effected a four-for-one split of class A common stock on March 19, 2015 |
Fiscal Second Quarter 2015 Financial Results 13 Financial Metrics for Fiscal Year 2015 Note: Fiscal full-year 2015 annual diluted earnings per share growth assumes an adjusted basis for fiscal full-year 2014. 17.5% - 18.5% range Mid 60s Low 30s Low-end of the mid-teens range Greater than $6 billion Constant dollar revenue growth of low double digits Negative 2 ppts foreign currency impact Annual free cash flow Annual diluted class A common stock earnings per share growth Tax rate Annual operating margin Client incentives as % of gross revenues Annual net revenue growth |
Appendix |
Fiscal Second Quarter 2015 Financial Results Calculation of Free Cash Flow US$ in millions A-1 Additions (+) / Reductions (-) to Net income Net income (as reported) 1,550 3,119 Capital Assets + Depreciation and amortization 125 245 - Capital expenditures (98) (202) 27 43 Litigation + Litigation provision 3 3 - Settlement payments (221) (324) + Settlement payments funded by litigation escrow 221 321 3 Share-based Compensation + Share-based compensation 48 93 Pension + Pension expense 5 11 - Pension contribution (2) 5 9 Taxes + Income tax provision 732 1,425 - Income taxes paid (1,319) (1,376) (587) 49 Changes in Working Capital +/- Changes in other working capital accounts (1) (31) (438) Total Free Cash Flow 1,015 2,875 Three Months Ended March 31, 2015 Six Months Ended March 31, 2015 Includes changes in client incentives, trade receivable/payable, settlement receivable/payable and personnel incentives. (1) |