Visa Results Top Estimates

(RTTNews) - Visa Inc. (V), the world's largest payment card processor, said Wednesday that its fourth quarter profit fell 10% from last year, hurt mainly by a hefty litigation provision even as revenue increased 9%.

However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations as did its quarterly revenue.

"Our enviable competitive position, strong business model, and great talent helped us deliver adjusted EPS growth of 17% for the fourth quarter and 19% for the full year in the face of continued tepid economic growth and a strengthening dollar. More importantly, the underlying metrics which will drive our revenue growth over the longer term are strong and getting stronger," said Charlie Scharf, Chief Executive Officer of Visa.

The company, which last week announced a 20% increase in quarterly dividend, said its Board of Directors has authorized a new $5 billion class A common stock share repurchase program.

Looking forward to fiscal 2015, the company forecasts constant dollar revenue growth of low double digits and earnings per share growth of mid teens percentage.

Visa shares are currently gaining 4.23% in after hours trading after closing the day's regular trading session at $214.66, down $2.05. The shares trade in a 52-week range of $194.26 to $235.50.

For the fourth quarter ended September 30, 2014, the Foster City, California-based company reported net income of $1.1 billion or $1.72 per Class A share, compared to $1.2 billion or $1.85 per Class A share for the year-ago quarter.

The latest quarter results include a $450 million pre-tax, or or $283 million after-tax, litigation provision related to the interchange multidistrict litigation case.

Excluding items, adjusted net income for the latest quarter was $1.4 billion or $2.18 per Class A share.

On average, 32 analysts polled by Thomson Reuters expected the company to earn $2.10 per share for the fourth quarter. Analysts' estimates typically exclude special items.

Total operating revenues for the fourth quarter rose 9% to $3.23 billion from $2.97 billion in the same quarter last year. Thirty analysts had a consensus revenue estimate of $3.19 billion for the fourth quarter.

Visa processed 16.9 billion transactions during the fourth quarter, up 9% from a year earlier.

Fourth quarter service revenues, which are recognized based on payments volume in the prior quarter, increased 8% year-over-year to $1.5 billion.