Eye on Earnings: Quarterly Results at Visa, Fiserv, Jack Henry, Tier

Visa Inc., which is planning an initial public stock offering this year, processed 9.1 billion transactions in its fiscal 2008 first quarter ended Dec. 31, up 1.1 billion or 13% from 8 billion a year earlier, according to the quarterly report the No. 1 payment network filed Feb. 4 with the Securities and Exchange Commission. Growth outside the United States accounted for 900 million transactions, or 81% of the quarterly increase. Visa reported net income of $424 million, more than double the $205 million in fiscal 2007's first quarter. Operating revenues, which consist mostly of fees charged to member financial institutions, grew 76% to $1.49 billion from $845 million in the year-earlier quarter. Operating expenses increased 50% to $802 million from $536 million. And in an amended annual report, Visa says U.S. payment volume on Visa-branded cards, excluding PIN-based debit card volume, increased by $105 billion, or 9%, to $1.3 trillion in its 2007 fiscal year ended Sept. 30 compared with fiscal 2006. Bank processor Fiserv Inc., which in December bought electronic bill-payment services provider CheckFree Corp. for $4.4 billion in cash, on Wednesday reported fourth-quarter net income of $96.7 million, down 9% from $105.9 million a year earlier. Revenues increased 19% to $1.11 billion compared with $930.1 million in 2006's fourth quarter. An assortment of one-time items, including acquisition expenses and $31.3 million in charges for discontinued operations, cut into earnings. Fiserv, however, says operating margins rose 110 basis points to 25.8% from 2006's fourth quarter. Brookfield, Wis.-based Fiserv signed 97 new electronic bill-pay clients during the quarter, bring the total to nearly 3,300. The CheckFree Electronic Biller Services unit began implementing e-bills for American Express Co.'s 20 million U.S. consumer cardholders and for more than 17 million Allstate Corp. insurance policyholders. The company's imaging business grew, with 90 financial institutions adding Fiserv's branch-capture product and 142 new merchants signing on for remote deposit capture. For the year, Fiserv reported net income of $439.3 million, down 2% from $449.9 million in 2006, on revenues of $3.92 billion, up 10% from $3.57 billion. Another bank processor and technology outsourcer, Monet, Mo.-based Jack Henry and Associates Inc., reported net income of $29.2 million for its second fiscal 2008 quarter ended Dec. 31, an increase of 5% from $27.8 million in the year-earlier quarter. Revenues increased 15% to $192.2 million from $167.2 million in fiscal 2007's second quarter. “All components of recurring revenue in support and services, which includes outsourcing, in-house maintenance and ATM/debit card processing, all continued to grow at nice levels,” company president Tony Wormington said in a statement. Reston, Va.-based Tier Technologies Inc., a processor whose main business is offering consumer electronic payments for government entities through its Official Payments Corp. subsidiary, posted a 12% increase in revenues in its first fiscal 2008 quarter ended Dec. 31?$29.2 million vs. $26.1 million in the year-earlier period. The company lost $1.43 million compared with a year-ago profit of $2.21 million because of continuing investments in its electronic payment-processing business, according to chairman and chief executive officer Ronald Rossetti. Tier plans to sell two divisions that offer services ranging from child-support payment processing to software for unemployment-insurance administration.