MasterCard Inc. (NYSE: MA) announced Tuesday that it returned to profitability in the third quarter, posting profit of $452.2 million or $3.45 a share. The result compares to a loss of $193.6 million or $1.48 a share in the same period a year ago.
Excluding one-time charges, MasterCard posted third quarter earnings of 3.48 a share, easily topping analyst estimates for $2.94 a share, according to a Thomson Reuters poll.
The credit card company saw a 2 percent rise in third quarter revenue to $1.4 billion. The increase was driven in part by a 7.6 percent jump in the total of number of processed transactions, to 5.8 billion. However, pricing increases were the main reason for net revenue growth in the quarter, adding 6 percent.
“We continue to make life easier for consumers, businesses and governments, all of whom seek safer, more controllable and more efficient payment alternatives for everyday commerce,” added Selander.
Though the company saw the number of transactions increase, gross dollar volume for the third quarter finished relatively flat at $633 billion.
MasterCard helped boosted third quarter results by making large reductions to its total operating expenses, down 13.3 percent. The decline was mainly driven by a drop in advertising costs, which dropped 29.4 percent compared to last year.
General and administrative costs dipped 7.9 percent, largely due to reduced travel expenses and professional fees. The cost reduction would have been much larger if not for increased severance costs of $31 million.
The special one-time charges in the third quarter were for pre-tax litigation settlement charges, totaling $6.2 million.
For the first nine months of 2009, MasterCard has earned $1.2 billion on revenue of $3.8 billion, about a 1 percent increase from last year.
