MasterCard Incorporated (MA)
Q3 2009 Earnings Call Transcript
November 03, 2009 9:00 a.m. ET
Executives
Barbara Gasper - Group Executive, Investor Relations
Robert Selander - Chief Executive Officer
Martina Hund-Mejean - Chief Financial Officer
Melissa Ballenger - Corporate Controller
Analysts
Julio Quinteros - Goldman Sachs
Donald Fandetti - Citigroup
Craig Maurer - CLSA
Moshe Katri - Cowen & Co.
Tim Willi - Wells Fargo Securities
David Parker - Lazard Capital Markets
Chris Brendler - Stifel Nicolaus
Moshe Orenbuch - Credit Suisse
Dan Perlin - RBC Capital Markets
Tien-Tsin Huang - JPMorgan
Sanjay Sakhrani - KBW
Christopher Mammone - Deutsche Bank
Presentation
Operator
Good day ladies and gentlemen and welcome to the third quarter 2009 MasterCard earnings conference call. My name is Latasha and I will be your coordinator for today. At this time all participants are in a listen-only mode. We would be facilitating a question-and-answer session towards the end of this conference. If at anytime during the call you require assistance please press star zero and a coordinator will be happy to assist you. I would now like to turn the call over to Miss Barbara Gasper, Group Executive, Investor Relations. Please proceed.
Barbara Gasper
Thank you Latasha, and good morning to everyone. Thank you for joining us today, either by phone or web-cast for a discussion of our third quarter 2009 financial results. With me on the call this morning are Bob Selander, Chief Executive Officer, Martina Hund-Mejean, our Chief Financial Officer and Melissa Ballenger, our Corporate Controller. Following comments by Bob and Martina, highlighting some key points about the quarter, we will open-up the call for your questions.
This morning''s earnings release and the slide deck that will be referenced on this call can be found in the Investor Relations section of our website, mastercard.com. The earnings release and slide deck have also -- that have been -- have been attached to an 8-K that we filed with the SEC this morning. A replay of this call will be posted on our website for one week until November 11.
Finally, as set forth in more detail in today''s earnings release, I need to remind everyone that today''s call may include some forward-looking statements about MasterCard''s future performance. Actual performance could differ materially from what is suggested by our comments today. Information about the factors that could affect future performance are summarized at the end of our press release, as well as contained in our recent SEC filings.
With that, I will now turn the call over to Bob Selander. Bob?
Robert Selander
Thanks, Barbara and good morning everyone. Despite the ongoing economic challenges, I am very pleased with our ability to deliver another quarter of strong financial performance. We saw net revenue growth of 2% on an as reported basis and on a constant currency basis net revenue growth was 3.9%.
We''ve continued to follow an aggressive and thoughtful approach to cost management, along with a somewhat slower than anticipated redeployment of marketing funds, resulting in total operating expenses declining approximately 13% this quarter, excluding the impact of litigation settlements. This has allowed us to deliver an 8.8 percentage points operating margin improvement over the same quarter last year, despite slower top line growth. I am equally pleased that net income grew 41.6% on the same adjusted basis.
The economic downturn has continued to affect consumer and business spending during the quarter. In addition to this weak spending, our volumes over the past few quarters have been impacted by several headwinds versus last year, such as foreign exchange rates, gas prices and slower cross border travel.
Like many other companies, we''ve had our fair share of challenges in the current business climate and we''ve continued to cutback where we can. However, our priority remains on utilizing our people and resources to develop our best opportunities, making sure we are appropriately investing for the future growth of our franchise.
We continue to benefit from the secular shift from cash and check, as evidenced by our process transactions, which grew at a high single-digit rate during the quarter on a worldwide basis. We''ve also seen double-digit process transaction growth coming from our Asia-Pacific, Middle East, Africa and Latin America regions during the quarter.
Overall, our results once again underscore the global trend toward electronic payments and the strength our business model affords us even in this environment. MasterCard continues to make life easier for consumers, businesses and governments alike, all of whom are seeking safer, more controllable and more efficient payment alternatives for everyday commerce.
|
