First Data Corp.'s per-share earnings jumped 18% in the first quarter, largely thanks to its money-transfer business.
The Atlanta company, the largest third-party processor of card transactions in the United States, also owns Western Union.
Overall profits rose 14% from a year earlier, to $187.5 million, or 47 cents per share, First Data reported Thursday - a penny more than the analyst consensus tallied by Thomson Financial/First Call. Revenue grew 10%, to $1.5 billion.
Revenue of First Data's payment services division, largely Western Union, rose 18%, to $626 million - about 40% of the corporate total. The division's profits rose 20%, to $161 million.
Worldwide money transfer transactions increased 23%, to 25.6 million, reflecting a global rise in Western Union's business.
First Data stock closed Thursday at $62.65, up 4% from the previous Friday.
Revenues will increase by 13% to 16% this year, the company predicted Thursday. Per-share earnings will rise 14% to 17%, to $2.44 to $2.50, it said - in line with the current consensus estimates of $2.48, according to Thomson Financial/First Call.
The outlook is especially positive considering that in October, after it announced plans to eliminate more than 1,000 jobs, some analysts had expressed concern that First Data would fail to meet 2001 revenue targets.
In addition, bank consolidation had caused First Data to lose some business and fueled fears of poor performance in the company's credit card issuing business. In a report issued last September, Morgan Stanley Dean Witter analyst David Togut predicted that First Data's revenue would grow only 11% to 13% this year. Acquired banks that had been its customers would probably have to use the same the card issuing services their buyers, he wrote.
As it turned out, card issuing revenue was flat in the first quarter, at $362 million, about 25% of First Data's total revenue.