EX-99.1 2 a12-10415_1ex99d1.htm EX-99.1

Exhibit 99.1

 

Vantiv Reports Strong First Quarter 2012 Results

 

Cincinnati, Ohio, April 26, 2012 — Vantiv, Inc. (NYSE: VNTV) (Vantiv or “the Company”) today announced financial results for the first quarter ended March 31, 2012.  Revenue increased 17% to $432.8 million as compared to $371.4 million in the prior year.  Net revenue increased 23% to $232.6 million as compared to $189.2 million in the prior year.  Cash net income increased 30% to $42.4 million as compared to $32.5 million in the prior year. Adjusted cash net income per share was $0.20.  (See Schedule 2 for cash net income and Schedule 6 for GAAP net income reconciliation to cash net income.)

 

On a GAAP basis, net loss attributable to Vantiv, Inc. was $18.4 million, or a $0.38 per diluted share, compared with net income of $3.5 million, or $0.04 per diluted share, in the prior year.  GAAP net loss included $91.8 million, or $0.55 loss on a diluted per share basis, primarily related to charges incurred in connection with refinancing of indebtedness following the Company’s initial public offering.

 

Transactions increased 12% and net revenue increased 23% primarily driven by a 16% increase in transactions in the Merchant Services segment and a 17% increase in rate per transaction in the Merchant Services segment.  Adjusted EBITDA increased 18% to $102.9 million, as compared to $87.5 million in the prior year. (See Schedule 7 for reconciliation from GAAP income from operations to adjusted EBITDA.)

 

“I am very proud of the results that the 2,500 employees in our talented Vantiv team produced in this new era as a publicly traded company.  Our successful IPO and first quarter results are a testament to our strong record of performance and our ability to create and capitalize on opportunities in this fast paced industry,” president and chief executive officer Charles Drucker said. “We are focused on growing our comprehensive and integrated suite of services and diversifying our distribution channels to expand our market share.  I also want to welcome our new shareholders.  You can expect our team to continue to build on its accomplishments with a laser focus on creating long-term value.”

 

Merchant Services

 

Net revenue increased 36% to $157.5 million as compared to $115.8 million in the prior year, primarily due to a 16% increase in transactions, as well as a 17% increase in net revenue per transaction.  We continue to experience an increase in net revenue per transaction as we expand our channels and increase our focus on the small and mid-sized merchants.  Sales and marketing expenses increased 36% to $66.7 million as compared to $48.9 million in the prior year in connection with the increase in revenue and continued expansion of distribution channels.

 

Financial Institution Services

 

Net revenue increased 2% to $75.1 million as compared to $73.5 million in the prior year, as organic revenue growth more than offset the attrition of a large client in the third quarter of 2011.  Sales and marketing expenses decreased by 10%.

 

2012 Financial Outlook

 

Net revenue for 2012 is expected to be between $995 million and $1,010 million, representing an increase of 15% to 17% as compared to 2011.  Cash net income is expected to be between $234 million and $242 million.  Adjusted cash net income per share is expected to be between $1.09 and $1.13.  GAAP net income per share is expected to be between $0.42 and $0.46 on a diluted per share basis.

 

1



 

Earnings Conference Call and Audio Webcast

 

The Company will host a conference call to discuss first quarter 2012 financial results today at 8:00 AM ET. Hosting the call will be Charles Drucker, president and chief executive officer and Mark Heimbouch, chief financial officer. The conference call can be accessed live over the phone by dialing (877) 941-1428, or for international callers (480) 629-9665.  A replay will be available approximately two hours after the call concludes and can be accessed by dialing (877) 870-5176, or for international callers (858) 384-5517, and entering the conference ID 4532093.  The replay will be available through Thursday, May 3, 2012.  The call will be webcast live from the Company’s investor relations website at http://investors.vantiv.com.

 

About Vantiv, Inc.

 

Vantiv, Inc. (NYSE: VNTV) is a leading, integrated payment processor differentiated by a single, proprietary technology platform.  Vantiv offers a comprehensive suite of traditional and innovative payment processing and technology solutions to merchants and financial institutions of all sizes in the U.S., enabling them to address their payment processing needs through a single provider.  We build strong relationships with our customers, helping them become more efficient, more secure and more successful.  Vantiv is the third largest merchant acquirer and the largest PIN debit acquirer based on number of transactions in the U.S.  The company’s growth strategy includes expanding further into high growth payment segments, such as ecommerce, mobile, prepaid and information solutions, and attractive industry verticals, such as business-to-business, government, healthcare and education. For more information, visit www.vantiv.com.

 

Non-GAAP Financial Measures

 

This earnings release presents non-GAAP financial information including net revenue, EBITDA, adjusted EBITDA, cash net income, and adjusted cash net income per share information. These are important financial measures for the Company, but are not financial measures as defined by GAAP.  The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.  The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that they provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.  Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the attached schedules.

 

Net revenue is revenue, less network fees less other costs. Cash net income includes adjustments to exclude, amortization of intangible assets acquired in business combinations, primarily customer related intangible assets, share-based compensation, transition costs associated with our separation from Fifth Third Bank, integration costs incurred in connection with acquisitions and conversion of non-controlling interests into shares of Class A common stock. For purposes of providing better comparability we also made adjustments to interest expense and depreciation in 2011. (See Schedule 6 for a reconciliation from GAAP net income to cash net income.)

 

2



 

Forward-Looking Statements

 

This release contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact or relating to present facts or current conditions included in this release are forward-looking statements including any statements of a general economic or industry specific nature. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “should,” “can have,” “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events.

 

The forward-looking statements contained in this release are based on assumptions that we have made in light of our industry experience and our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. As you review and consider this presentation, you should understand that these statements are not guarantees of future performance or results. They depend upon future events and are subject to risks, uncertainties (many of which are beyond our control) and assumptions. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual future performance or results and cause them to differ materially from those anticipated in the forward-looking statements. Certain of these factors and other risk factors are discussed in the Company’s registration statement filed with the U.S. Securities and Exchange Commission and include, but are not limited to: (i) the ability to keep pace with rapid developments and change in our industry and provide new services to our clients; (ii) competition within our industry; (iii) disclosure of unauthorized data and security breaches that expose us to liability, litigation and reputational damage; (iv) failures of our systems or systems of our third party providers; (v) our inability to expand our market share in existing markets or expand into new markets; (vi) our ability to identify acquisition, joint venture and partnership candidates and finance or integrate businesses, services or technologies that we acquire; (vii) failure to comply with applicable requirements of Visa, MasterCard or other payment networks; (viii) changes in payment network rules or standards; (ix) our ability to pass fee increases along to merchants; (x) termination of sponsorship or clearing services provided to us; (xi) increased attrition of our merchants, independent sales organizations, or ISOs, or referral partners; (xii) inability to successfully renew or renegotiate agreements with our clients or ISOs; (xiii) reductions in overall consumer, business and government spending; (xiv) fraud by merchants or others; (xv) a decline in the use of credit, debit or prepaid cards; (xvi) consolidation in the banking and retail industries; and (xvii) the effects of governmental regulation, changes in laws and outcomes of future litigation or investigations.  Should one or more of these risks or uncertainties materialize, or should any of these assumptions prove incorrect, our actual results may vary in material respects from those projected in these forward-looking statements.

 

Any forward-looking statement made by us in this release speaks only as of the date on which we make it. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

 

Contacts
Don Duffy/Dara Dierks
866-254-4811 or 513-900-4811
IR@vantiv.com

 

3



 

Schedule 1

Vantiv, Inc.

Consolidated Statements of Income (Loss)

(in thousands, except share data)

(Unaudited)

 

 

 

Three months ended

 

 

 

 

 

March 31,

 

March 31,

 

 

 

 

 

2012

 

2011

 

% Change

 

 

 

 

 

 

 

 

 

Revenue

 

$

432,789

 

$

371,446

 

17

%

Network fees and other costs

 

200,208

 

182,216

 

10

%

Net revenue

 

232,581

 

189,230

 

23

%

Sales and marketing

 

72,757

 

56,219

 

29

%

Other operating costs

 

39,009

 

37,740

 

3

%

General and administrative

 

28,597

 

21,383

 

34

%

Depreciation and amortization

 

38,895

 

36,700

 

6

%

Income from operations

 

53,323

 

37,188

 

43

%

Interest expense—net

 

(24,450

)

(30,621

)

-20

%

Non-operating expenses(1)

 

(91,836

)

 

NM

 

Income (loss) before applicable income taxes

 

(62,963

)

6,567

 

NM

 

Income tax expense (benefit)

 

(20,035

)

1,868

 

NM

 

Net income (loss)

 

(42,928

)

4,699

 

NM

 

Less: Net (income) loss attributable to noncontrolling interests

 

24,564

 

(1,200

)

NM

 

Net income (loss) attributable to Vantiv, Inc.

 

$

(18,364

)

$

3,499

 

NM

 

 

 

 

 

 

 

 

 

Net income (loss) per share of Class A common stock attributable to Vantiv, Inc.:

 

 

 

 

 

 

 

Basic

 

$

(0.20

)

$

0.04

 

 

 

Diluted

 

$

(0.38

)

$

0.04

 

 

 

Shares used in computing net income (loss) per share of Class A common stock:

 

 

 

 

 

 

 

Basic

 

93,018,506

 

89,515,617

 

 

 

Diluted

 

102,377,931

 

89,515,617

 

 

 

 

 

 

 

 

 

 

 

Non Financial Data:

 

 

 

 

 

 

 

Transactions (in millions)

 

3,367

 

3,002

 

12

%

 


(1) Non-operating expenses primarily consist of charges incurred with the refinancing of our debt and the termination of our interest rate swaps in March 2012.

 

1



 

Schedule 2

Vantiv, Inc.

Cash Net Income (Non-GAAP)

(in thousands, except share data)

(Unaudited)

 

See schedule 6 for a reconciliation of GAAP net income (loss) to cash net income.

 

 

 

Three months ended

 

 

 

 

 

March 31,

 

March 31,

 

 

 

 

 

2012

 

2011

 

% Change

 

 

 

 

 

 

 

 

 

Revenue

 

$

432,789

 

$

371,446

 

17

%

Network fees and other costs

 

200,208

 

182,216

 

10

%

Net revenue

 

232,581

 

189,230

 

23

%

Sales and marketing

 

72,757

 

56,219

 

29

%

Other operating costs

 

38,557

 

31,500

 

22

%

General and administrative

 

18,327

 

13,990

 

31

%

Adjusted EBITDA(1)

 

102,940

 

87,521

 

18

%

Depreciation and amortization

 

9,606

 

8,093

 

19

%

Income from operations

 

93,334

 

79,428

 

18

%

Interest expense—net

 

(24,450

)

(26,625

)

-8

%

Income before applicable income taxes

 

68,884

 

52,803

 

30

%

Income tax expense (at an effective tax rate of 38.5%)

 

26,520

 

20,330

 

30

%

Cash net income(2)

 

$

42,364

 

$

32,473

 

30

%

 

 

 

 

 

 

 

 

Adjusted cash net income per share

 

$

0.20

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted shares outstanding(3)

 

212,304,534

 

 

 

 

 

 

 

 

 

 

 

 

 

Non Financial Data:

 

 

 

 

 

 

 

Transactions (in millions)

 

3,367

 

3,002

 

12

%

 

Non-GAAP Financial Measures

 

This schedule presents net revenue, adjusted EBITDA, cash net income, and adjusted cash net income per share information.  These are important financial measures for the company, but are not financial measures as defined by GAAP.  Such financial measures should not be considered as alternatives to GAAP net income, and such measures may not be comparable to those reported by other companies.

 

Cash net income is derived from GAAP net income, adjusting for the following items: (a) amortization of intangible assets acquired in business combinations, primarily customer related intangible assets; (b) non-operating expenses primarily associated with the refinancing of our debt and the termination of our interest rate swaps in March 2012; (c) adjustments to income tax expense assuming conversion of non-controlling interests into shares of Class A common stock.  For purposes of providing better comparability, we also make adjustments for Q1 2011 to reflect depreciation and amortization assuming that our property and equipment at December 31, 2011 was in place on January 1, 2011 and for interest expense assuming the Company’s level of debt and applicable terms as of December 31, 2011 was outstanding on January 1, 2011.

 


(1) See schedule 7 for a reconciliation of GAAP income from operations to adjusted EBITDA.

(2) Cash net income assumes the conversion of non-controlling interests into shares of Class A common stock.

(3) Shares are pro forma assuming the equity structure in place March 31, 2012, was in place January 1, 2012.  Shares used in computing GAAP diluted net income (loss) per share were 102,377,931 .

 

Adjusted shares for the three months ended March 31, 2012

 

 

 

Shares used in computing adjusted cash net income per share:

 

 

 

Class A common stock(a)

 

120,641,114

 

Class B units of Vantiv Holding(b)

 

85,913,505

 

Restricted stock(a)(c)

 

1,961,837

 

Warrant(d)

 

3,788,078

 

Adjusted shares outstanding

 

212,304,534

 

 


(a) Shares are weighted as if the equity structure in place March 31, 2012, was in place January 1, 2012.

(b) Class B units in Vantiv Holding are based on the if-converted method and represent fully diluted ownership in Vantiv, Inc. weighted as if the equity structure in place March 31, 2012, was in place January 1, 2012.

(c) Restricted Class A common stock issued under the treasury method based on the closing share price of VNTV as of March 30, 2012.  These are excluded for GAAP purposes as they are anti-dilutive.

(d) Class A common stock issued upon exercise of the Warrant under the treasury method based on the closing share price of VNTV as of March 30, 2012.  These are excluded for GAAP purposes as they are anti-dilutive.

 

2



 

Schedule 3

Vantiv, Inc.

Segment Information

(in thousands)

(Unaudited)

 

 

 

Three months ended March 31, 2012

 

 

 

 

 

Financial Institution

 

General

 

 

 

 

 

Merchant Services

 

Services

 

Corporate/Other

 

Total

 

Total revenue

 

$

322,978

 

$

109,811

 

$

 

$

432,789

 

Network fees and other costs

 

165,526

 

34,682

 

 

200,208

 

Net revenue

 

157,452

 

75,129

 

 

232,581

 

Sales and marketing

 

66,699

 

6,058

 

 

72,757

 

Segment profit

 

$

90,753

 

$

69,071

 

$

 

$

159,824

 

 

 

 

 

 

 

 

 

 

 

Non-financial data:

 

 

 

 

 

 

 

 

 

Transactions (in millions)

 

2,544

 

823

 

 

 

3,367

 

Net revenue per transaction

 

$

0.0619

 

$

0.0913

 

 

 

$

0.0691

 

 

 

 

Three months ended March 31, 2011

 

 

 

 

 

Financial Institution

 

General

 

 

 

 

 

Merchant Services

 

Services

 

Corporate/Other

 

Total

 

Total revenue

 

$

262,686

 

$

108,760

 

$

 

$

371,446

 

Network fees and other costs

 

146,911

 

35,305

 

 

182,216

 

Net revenue

 

115,775

 

73,455

 

 

189,230

 

Sales and marketing

 

48,887

 

6,710

 

622

 

56,219

 

Segment profit

 

$

66,888

 

$

66,745

 

$

(622

)

$

133,011

 

 

 

 

 

 

 

 

 

 

 

Non-financial data:

 

 

 

 

 

 

 

 

 

Transactions (in millions)

 

2,184

 

818

 

 

 

3,002

 

Net revenue per transaction

 

$

0.0530

 

$

0.0898

 

 

 

$

0.0630

 

 

3



 

Schedule 4

Vantiv, Inc.

Condensed Consolidated Statements of Financial Position

(in thousands, except share data)

 

 

 

March 31,

 

December 31,

 

 

 

2012

 

2011

 

 

 

(Unaudited)

 

 

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

156,362

 

$

370,549

 

Accounts receivable — net

 

352,033

 

368,658

 

Related party receivable

 

5,002

 

4,361

 

Settlement assets

 

71,811

 

46,840

 

Prepaid expenses

 

11,270

 

8,642

 

Other

 

46,734

 

20,947

 

Total current assets

 

643,212

 

819,997

 

 

 

 

 

 

 

Customer incentives

 

17,681

 

17,493

 

Property and equipment — net

 

160,272

 

152,310

 

Intangible assets — net

 

889,389

 

916,198

 

Goodwill

 

1,532,374

 

1,532,374

 

Deferred taxes

 

12,292

 

4,292

 

Other assets

 

28,540

 

47,046

 

Total assets

 

$

3,283,760

 

$

3,489,710

 

 

 

 

 

 

 

Liabilities and equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable and accrued expenses

 

$

172,107

 

$

193,706

 

Related party payable

 

950

 

3,814

 

Settlement obligations

 

163,851

 

208,669

 

Current portion of note payable

 

52,500

 

16,211

 

Deferred income

 

9,402

 

7,313

 

Current maturities of capital lease obligations

 

4,256

 

4,607

 

Other

 

5,759

 

6,400

 

Total current liabilities

 

408,825

 

440,720

 

Long-term liabilities:

 

 

 

 

 

Note payable

 

1,202,217

 

1,738,498

 

Tax receivable agreement obligations

 

333,000

 

 

Capital lease obligations

 

11,152

 

12,322

 

Deferred taxes

 

9,263

 

9,263

 

Other

 

2,006

 

33,187

 

Total long-term liabilities

 

1,557,638

 

1,793,270

 

Total liabilities

 

1,966,463

 

2,233,990

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

Equity:

 

 

 

 

 

Total equity(1)

 

1,317,297

 

1,255,720

 

Total liabilities and equity

 

$

3,283,760

 

$

3,489,710

 

 


(1) Includes equity attributable to non-controlling interests.

 

4



 

Schedule 5

Vantiv, Inc.

Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)

 

 

 

Three months ended

 

 

 

March 31,

 

March 31,

 

 

 

2012

 

2011

 

Operating Activities:

 

 

 

 

 

Net (loss) income

 

$

(42,928

)

$

4,699

 

Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

 

 

 

 

 

Depreciation and amortization expense

 

38,895

 

36,700

 

Amortization of customer incentives

 

1,234

 

684

 

Amortization and write-off of debt issuance costs

 

56,352

 

2,575

 

Share-based compensation expense

 

8,663

 

652

 

Change in operating assets and liabilities:

 

 

 

 

 

Decrease in accounts receivable and related party receivable

 

15,984

 

25,611

 

Decrease in net settlement assets and obligations

 

(69,789

)

(42,852

)

Increase in customer incentives

 

(1,422

)

(3,045

)

Increase in prepaid and other assets

 

(26,764

)

(7,231

)

Decrease in accounts payable and accrued expenses

 

(35,099

)

(13,505

)

Decrease in payable to related party

 

(2,864

)

(2,798

)

Increase in other liabilities

 

1,719

 

495

 

Net cash (used in) provided by operating activities

 

(56,019

)

1,985

 

 

 

 

 

 

 

Investing Activities:

 

 

 

 

 

Purchases of property and equipment

 

(10,269

)

(7,915

)

Residual buyouts

 

(2,829

)

(512

)

Purchase of investments

 

 

(3,300

)

Net cash used in investing activities

 

(13,098

)

(11,727

)

 

 

 

 

 

 

Financing Activities:

 

 

 

 

 

Proceeds from initial public offering, net of offering costs

 

460,913

 

 

Proceeds from follow-on offering, net of offering costs

 

33,512

 

 

Proceeds from issuance of long-term debt

 

1,248,750

 

 

Repayment of debt and capital lease obligations

 

(1,761,784

)

(3,972

)

Payment of debt issuance costs

 

(28,949

)

 

Purchase of Class B units in Vantiv Holding from Fifth Third

 

(33,512

)

 

Repurchase of Class A common stock (to satisfy tax withholding obligations)

 

(11,929

)

 

Tax benefit from employee share-based compensation

 

10,244

 

 

Distribution to funds managed by Advent International Corporation

 

(40,086

)

 

Distribution to non-controlling interests

 

(22,229

)

(28

)

Net cash used in financing activities

 

(145,070

)

(4,000

)

 

 

 

 

 

 

Net decrease in cash and cash equivalents

 

(214,187

)

(13,742

)

Cash and cash equivalents — Beginning of period

 

370,549

 

236,512

 

Cash and cash equivalents —End of period

 

$

156,362

 

$

222,770

 

 

 

 

 

 

 

Cash Payments:

 

 

 

 

 

Interest

 

$

32,559

 

$

26,927

 

Taxes

 

773

 

667

 

Noncash Items:

 

 

 

 

 

Assets acquired under capital lease obligations

 

$

 

$

12,234

 

 

5



 

Schedule 6

Vantiv, Inc.

Reconciliation of GAAP Net Income (Loss) to Cash Net Income

(in thousands)

(Unaudited)

 

 

 

Three months ended March 31, 2012

 

 

 

 

 

Transition, Acquisition

 

Share-Based

 

Comparability

 

Other

 

 

 

 

 

GAAP

 

and Integration(1)

 

Compensation

 

Adjustments

 

Adjustments

 

Cash Net Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

432,789

 

$

 

$

 

$

 

$

 

$

432,789

 

Network fees and other costs

 

200,208

 

 

 

 

 

200,208

 

Net revenue

 

232,581

 

 

 

 

 

232,581

 

Sales and marketing

 

72,757

 

 

 

 

 

72,757

 

Other operating costs

 

39,009

 

(452

)

 

 

 

38,557

 

General and administrative

 

28,597

 

(1,607

)

(8,663

)

 

 

18,327

 

Depreciation and amortization

 

38,895

 

 

 

 

(29,289

)(2)

9,606

 

Income from operations

 

53,323

 

2,059

 

8,663

 

 

29,289

 

93,334

 

Interest expense—net

 

(24,450

)

 

 

 

 

(24,450

)

Non-operating expenses

 

(91,836

)

 

 

 

91,836

(3)

 

Income (loss) before applicable income taxes

 

(62,963

)

2,059

 

8,663

 

 

121,125

 

68,884

 

Income tax expense (benefit)

 

(20,035

)

793

 

3,335

 

 

42,427

(4)

26,520

 

Net income (loss)(5)

 

$

(42,928

)

$

1,266

 

$

5,328

 

$

 

$

78,698

 

$

42,364

 

 

 

 

Three months ended March 31, 2011

 

 

 

 

 

Transition, Acquisition

 

Share-Based

 

Comparability

 

Other

 

 

 

 

 

GAAP

 

and Integration(1)

 

Compensation

 

Adjustments

 

Adjustments

 

Cash Net Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

371,446

 

$

 

$

 

$

 

$

 

$

371,446

 

Network fees and other costs

 

182,216

 

 

 

 

 

182,216

 

Net revenue

 

189,230

 

 

 

 

 

189,230

 

Sales and marketing

 

56,219

 

 

 

 

 

56,219

 

Other operating costs

 

37,740

 

(6,240

)

 

 

 

31,500

 

General and administrative

 

21,383

 

(6,741

)

(652

)

 

 

13,990

 

Depreciation and amortization

 

36,700

 

 

 

2,597

(6)

(31,204

)(2)

8,093

 

Income (loss) from operations

 

37,188

 

12,981

 

652

 

(2,597

)

31,204

 

79,428

 

Interest expense—net

 

(30,621

)

 

 

3,996

(7)

 

(26,625

)

Non-operating expenses

 

 

 

 

 

 

 

Income before applicable income taxes

 

6,567

 

12,981

 

652

 

1,399

 

31,204

 

52,803

 

Income tax expense

 

1,868

 

4,998

 

251

 

539

 

12,674

(4)

20,330

 

Net income(5)

 

$

4,699

 

$

7,983

 

$

401

 

$

860

 

$

18,530

 

$

32,473

 

 

Non-GAAP Financial Measures

This schedule presents net revenue and cash net income.  These are important financial measures for the company, but are not financial measures as defined by GAAP.  Such financial measures should not be considered as alternatives to GAAP net income, and such measures may not be comparable to those reported by other companies.

 


(1) Represents costs associated with our separation from Fifth Third Bank and acquisition and integration costs in connection with our acquisitions in 2010.

(2) Represents amortization of intangible assets acquired in business combinations, primarily customer related intangible assets.

(3) Represents non-operating expenses primarily associated with the refinancing of our debt and the termination of our interest rate swaps in March 2012.

(4) Represents adjustments to income tax expense assuming conversion of non-controlling interests into shares of Class A common stock.

(5) Net income (loss) assumes the conversion of non-controlling interests into shares of Class A common stock.

(6) Depreciation and amortization represents expense associated with our property and equipment, assuming that our property and equipment at December 31, 2011 was in place on January 1, 2011.

(7) Represents adjustment to reflect what our 2011 interest expense would have been if the Company’s level of debt and applicable terms as of December 31, 2011 was outstanding on January 1, 2011.

 

6



 

Schedule 7

Vantiv, Inc.

Reconciliation of GAAP Income from Operations to Adjusted EBITDA

(in thousands)

(Unaudited)

 

 

 

Three months ended

 

 

 

 

 

March 31,

 

March 31,

 

 

 

 

 

2012

 

2011

 

% Change

 

 

 

 

 

 

 

 

 

Income from operations

 

$

53,323

 

$

37,188

 

43

%

Depreciation and amortization

 

38,895

 

36,700

 

6

%

EBITDA

 

92,218

 

73,888

 

25

%

Transition, acquisition and integration costs(1)

 

2,059

 

12,981

 

-84

%

Share-based compensation

 

8,663

 

652

 

NM

 

Adjusted EBITDA

 

$

102,940

 

$

87,521

 

18

%

 

Non-GAAP Financial Measures

This schedule presents EBITDA and adjusted EBITDA.  These are important financial measures for the company, but are not financial measures as defined by GAAP.

These financial measures should not be considered as an alternative to GAAP income from operations, and may not be comparable to those reported by other companies.

 


(1) Represents costs associated with our separation from Fifth Third Bank and acquisition and integration costs in connection with our acquisitions in 2010.

 

7