EX-99.1 2 dex991.htm MASTERCARD INCORPORATED INVESTOR PRESENTATIONS DATED MAY 13, 2009 MasterCard Incorporated Investor Presentations dated May 13, 2009
May 13, 2009
MasterCard Incorporated
2009 Investment Community Meeting
Exhibit 99.1


2
May 13, 2009
2009 Investment Community Meeting
Today’s presentation may contain, in addition to historical information,
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995.
These forward-looking statements are based on our current
assumptions, expectations and projections about future events which
reflect the best judgment of management and involve a number of
risks and uncertainties that could cause actual results to differ
materially from those suggested by our comments today.  You should
review and consider the information contained in our filings with the
SEC regarding these risks and uncertainties. 
MasterCard
disclaims
any
obligation
to
publicly
update
or
revise
any
forward-looking statements or information provided during today’s
presentations.
Forward-Looking Statements


May 13, 2009
Strategic
Overview
2009 Investment Community Meeting
Robert W. Selander, President and Chief Executive Officer


4
May 13, 2009
2009 Investment Community Meeting
Operating Environment
Remaining Flexible and
Adapting
to the
leveraging
our
strengths
challenging
environment
&


5
May 13, 2009
2009 Investment Community Meeting
MasterCard GDV, Processed Transactions,
and Net Revenue Growth
* Net Revenue growth has been FX adjusted for the Euro and Real
0%
5%
10%
15%
20%
25%
Q2'08
Q3'08
Q4'08
Q1'09
GDV (LC)
Processed Transactions
Net
Revenue*


6
May 13, 2009
2009 Investment Community Meeting
Managing for Top-Line Growth
and Bottom-Line Performance
Continuing to focus on expense reduction
Prudent management of G&A and A&M
Reorganization contributed to efficiencies
Maintaining a healthy balance sheet
Investing for the future


7
May 13, 2009
2009 Investment Community Meeting
Current Environment:
U.S. Consumer Spending
High Sensitivity
Home furnishings;
luxury retail; appliances
High Sensitivity
Home furnishings;
luxury retail; appliances
-20% to -27%
Medium Sensitivity
Airlines; hotels;
footwear; apparel
Medium Sensitivity
Airlines; hotels;
footwear; apparel
-10% to -20%
Low Sensitivity
Groceries; fast food;
telecomm; beverages;
drugstores
Low Sensitivity
Groceries; fast food;
telecomm; beverages;
drugstores
Flat to Positive
Source: MasterCard SpendingPulse, April 2009. A macro-economic indicator, SpendingPulse reports on national retail sales and is based on aggregate sales
activity in the MasterCard payments network, coupled with estimates for all other payment forms, including cash and check. MasterCard SpendingPulse does
not represent MasterCard financial performance. SpendingPulse is provided by MasterCard Advisors, the professional services arm of MasterCard Worldwide.


8
May 13, 2009
2009 Investment Community Meeting
Current Environment:
Payments Industry
Customers facing
a multitude of challenges
Industry consolidation
Increased competition


9
May 13, 2009
2009 Investment Community Meeting
Current Environment:
Regulatory/Legislative
Regulatory/legislative
developments
Interim arrangement with
European Commission
U.S. legislative
environment
Dual issuance in Canada
Customers facing
a multitude of challenges
Industry consolidation
Increased competition


10
May 13, 2009
2009 Investment Community Meeting
Looking Ahead:
Economy and Payments Industry
Pace of decline slowing in U.S.
Economic conditions mixed outside of U.S.
Impact of stimulus packages still to come
Consolidation of banks likely to continue
Payments industry will continue to face challenges


11
May 13, 2009
2009 Investment Community Meeting
Dynamic Strategy
Remain flexible
Better mitigate threats
Take advantage of
opportunities earlier
Be more adaptive and agile
Helping us…
Industry trends and
forces at work
Tracking…
Utilizing
Scenario
Planning
Utilizing
Scenario
Planning


12
May 13, 2009
2009 Investment Community Meeting
Customer-Focused Strategy
Sensitive to cultural
and regulatory
differences
Developing products
and solutions
for local markets


13
May 13, 2009
2009 Investment Community Meeting
International Markets
U.S. Markets
Each region has a lead for:
Customers
Customer-Focused Strategy
Commerce
Development
Customer
Delivery
Products &
Solutions
APMEA
Canada
Europe
LA/C
United States


14
May 13, 2009
2009 Investment Community Meeting
Leveraging Our Strengths to
Capture Opportunities
Franchisor
Processor
Advisor
Continued migration to
electronic payments
Technologically savvy
consumers/businesses
Opportunities in debit,
prepaid, affluent,
commercial, mobile
Growth in processed
transactions
Need for advisory
capabilities, particularly in
today’s environment


15
May 13, 2009
2009 Investment Community Meeting
Summary
Solid business model
Strong global diversification
Well positioned for the long term
Remaining Flexible and
Adapting
to the
leveraging
our
strengths
challenging
environment
&


May 13, 2009
Fireside Chat
2009 Investment Community Meeting
Chris McWilton, President, U.S. Markets
Walt Macnee, President, International Markets


May 13, 2009
Global Products and Solutions
2009 Investment Community Meeting
Gary Flood, President,  Global Products and Solutions


18
May 13, 2009
2009 Investment Community Meeting
Core Products
Innovative Platforms
Network Products
MasterCard Advisors
Worldwide Marketing
& Communications
Organized and Aligned to Deliver
Franchisor
Processor
Advisor
Impactful
Solutions


19
May 13, 2009
2009 Investment Community Meeting
Solving Customer and Market Needs
We fully understand our customers’
local, regional and
global needs —
for today and tomorrow
Impactful
Solutions
Insights
Insights
People
People
Technology
Technology
Brand
Brand


20
May 13, 2009
2009
Investment
Community
Meeting
Understanding the Opportunity
Displace
Cash and Checks
Displace
Cash and Checks
Focused
on
ways to…
Total
commercial
card
spend
to grow to $1.2T by 2011
5
More than
64 million
small
businesses
globally
6
Gen
Y
in
the
US
average
$100/week
in
disposable
income
7
US
retail
e-commerce
sales
to
grow
to
$203B
by
2013
8
P2P
$456B Globally by 2010
3
Prepaid
$650B
Globally
by
2015
4
Smart
phones
will
comprise
38%
of all mobile phones by 2011
1
Affluent
households
account
for
47% of household income in the US
2
Sources:
1
eMarketer;
2009;
2
“The
Affluent
Market
in
the
US,”
Packaged
Facts
Apr
2007;
3
World
Bank,
2009;
4
Boston
Consulting
Group/PSE
Study,
May
2008;
5
Euromonitor
adjusted
for
5%
annual inflation,
2007;
Dun
&
Bradstreet,
Market
Insights,
2009;
7
Tough
Customers,
how
to
beat
Gen
Y,”
Microsoft
small
business
center,
2009;
8
eMarketer
Revise
e-commerce
Forecast,
eMarketer, March
2009


21
May 13, 2009
2009 Investment Community Meeting
Trends We’re Tracking
CUSTOMER
CONSUMER/
COMMERCIAL
Cost containment
Portfolio optimization
International spend and remittance flows
Empowerment of youth
Spending power of underserved
All-in-one products & services
Technology advancements
Bank consolidation


22
May 13, 2009
2009
Investment
Community Meeting
Setting
Priorities,
Investment
Strategies
Insights
drive priorities
Commercial
Commercial
Affluent
Affluent
inControl
inControl
P2P
P2P
Mobile
Mobile
Prepaid
Prepaid
PayPass
PayPass
E-commerce
E-commerce
Processing
Processing
Brand & Reputation
Brand & Reputation
Advisors
Advisors
Impactful
Solutions
Debit
Debit


23
May 13, 2009
2009 Investment Community Meeting
Managing Risk and Fraud
Solving Today’s Needs and Paving the
Way for Tomorrow’s Opportunities
with Relevant
Insights…
Innovation
Portfolio
Optimization
The Market
Network
Technology
Into New
Segments
Benchmarking
Research
Predictive capabilities
Analytics


24
May 13, 2009
2009 Investment Community Meeting
Solving Today’s Needs and Paving the
Way for Tomorrow’s Opportunities
with Relevant
Insights
Network
Technology
Innovation…
Into New
Segments
The Market
Portfolio
Optimization
Mobile
Contactless
Controls for
businesses and
consumers
BarclayCard Orange
MasterCard inControl


25
May 13, 2009
2009 Investment Community Meeting
Solving Today’s Needs and Paving the
Way for Tomorrow’s Opportunities
Partnering to Drive Results
with Relevant
Insights
Portfolio
Optimization…
Network
Technology
Innovation
Into New
Segments
The Market
Strategy definition
Partner selection
Operations set-up
Activation, usage & retention


26
May 13, 2009
2009 Investment Community Meeting
Solving Today’s Needs and Paving the
Way for Tomorrow’s Opportunities
France Retail Innovation
with Relevant
Insights
Portfolio
Optimization
The Market…
Network
Technology
Innovation
Into New
Segments
Coordinated issuer &
merchant strategies
Differentiated products
Processing and acceptance
Canada Chip Migration


27
May 13, 2009
2009 Investment Community Meeting
Solving Today’s Needs and Paving the
Way for Tomorrow’s Opportunities
with Relevant
Insights
Portfolio
Optimization
The Market
Network
Technology
Into New
Segments…
Innovation
Emerging opportunity
Strong growth potential
Global leverage
Local execution
Exclusively for Women
Barclaycard UK Small Business


28
May 13, 2009
2009 Investment Community Meeting
Solving Today’s Needs and Paving the
Way for Tomorrow’s Opportunities
Network
Technology
with Relevant
Insights
Innovation
Portfolio
Optimization
The Market
Into New
Segments
Intelligent Ways to Grow
Wired for speed & reliability
Real-time processing
services
High-volume thresholds


29
May 13, 2009
2009 Investment Community Meeting
MasterCard successfully leverages its capabilities
by
deploying local and regional expertise and
learnings worldwide.


May 13, 2009
Core Products
2009 Investment Community Meeting
Tim Murphy,
Group Executive, Core Products


31
May 13, 2009
2009 Investment Community Meeting
Core Products –
Today’s Focus
Expand the
business by…
Driving meaningful differentiation
Delivering thought leadership and
deep product expertise
Executing disciplined product strategies
Integrating and aligning
around opportunities
Affluent Consumer Credit
Affluent Consumer Credit
Debit
Debit
Prepaid
Prepaid


32
May 13, 2009
2009 Investment Community Meeting
Affluent Consumer Credit
Leveraging the
equity in
Priceless
Leveraging the
equity in
Priceless
A
priority
for
our
customers
Sizable,
growing,
resilient
Core
to
growth
in
Asia,
the
Middle
East
and
Latin
America
Customers
are
increasingly
open  
to
partnering
with
MasterCard


33
May 13, 2009
2009 Investment Community Meeting
Affluent Consumer Credit
Our affluent strategy
is to build
flexible solutions that
drive true business value
to our financial institution customers.
Our affluent strategy
is to build
flexible solutions that
drive true business value
to our financial institution customers.
Revitalized World MasterCard program
Expansion of World Elite program
Building in global consistency and
local customization
Deliver value based on a deep
understanding of the consumer segments


34
May 13, 2009
2009 Investment Community Meeting
Debit
Debit is a
rapidly growing
non-cash global
payment method.


35
May 13, 2009
2009 Investment Community Meeting
Emerging high-growth
(Central/Eastern Europe)
Grow volumes around acceptance,
education, activation and usage
Debit
Driving integrated strategies
market by market…
Continental Europe/SEPA
Expand Maestro, increase domestic
processing, deliver best-in-class features
Mature (UK and the Nordics)
Roll out Debit MasterCard,
retain Maestro
Europe


36
May 13, 2009
2009 Investment Community Meeting
Debit
Taking our game
to the next level…
U.S.
Executing our strategy to
grow the business
Optimize the franchise for debit
Secure the base / support
customer performance
Growing scale and share of
new business
Deliver unique products / value
propositions


37
May 13, 2009
2009 Investment Community Meeting
Prepaid
Prepaid is one of the
fastest growing
payment categories
for MasterCard.
Public
Sector
Public
Sector
Corporate
Programs
Corporate
Programs
Financial
Inclusion
Financial
Inclusion
Top three categories targeted…


38
May 13, 2009
2009 Investment Community Meeting
Big Wins in Prepaid
One of the largest awarded social
benefits
card
programs
in
Europe.
(Poste
Italiane
in Italy)
Largest consumer reloadable /
financial inclusion program
in the U.S. (H&R Block Bank)
Largest awarded public sector
benefits
card
opportunity
*
in
the
U.S.
(Social Security Administration & Comerica)
* Mercator


39
May 13, 2009
2009 Investment Community Meeting
Prepaid Travelex Win
World’s largest
foreign currency
prepaid card provider
prefers MasterCard’s…
Strong
Global Brand
Strong
Global Brand
Leadership
in Prepaid
Leadership
in Prepaid
Global
Processing
Capabilities
Global
Processing
Capabilities
Portfolio
Optimization
Expertise
Portfolio
Optimization
Expertise


40
May 13, 2009
2009 Investment Community Meeting
Advancing
MasterCard’s
strategy with…
Differentiation,
Thought Leadership,
and Integration
Advancing
MasterCard’s
strategy with…
Differentiation,
Thought Leadership,
and Integration
Core Products


May 13, 2009
Innovative Platforms
2009 Investment Community Meeting
Joshua Peirez, Group Executive, Innovative Platforms


42
May 13, 2009
2009 Investment Community Meeting
Today’s Discussion
Approach to
Innovation
Demonstrating
by
Example
Uses of
Technology


43
May 13, 2009
2009 Investment Community Meeting
The Importance of Innovation
Our unique platforms give us
the
ability
to
add
value
to
every transaction.
Game-changing
innovations
move choice and control to the
hands of the consumer.
Technology
innovations
deliver
new ways to connect consumers
with their payment accounts.
Innovating got us where
we are today, but today’s
innovations represent
tomorrow’s table stakes.


44
May 13, 2009
2009 Investment Community Meeting
Our Product Development Approach
We prefer to aim at
where the target will be
not just where it is TODAY.


45
May 13, 2009
2009 Investment Community Meeting
Identifying Strengths and Capabilities
Real-time
access to data
Personalization
at the
account level
Fast payment
processing
Global
interoperability
Easy integration of
emerging channels
Greater
profitability
from existing
customers


46
May 13, 2009
2009 Investment Community Meeting
Building Best-in-Class Solutions
Integrated
Solutions
Integrated
Solutions


47
May 13, 2009
2009 Investment Community Meeting
Using Technology to Innovate
Build
leverage existing
resources and
network expertise
Acquire
gain functional
capabilities we
identify as a need
Partner
bring together
‘best of the breed’
technology providers


48
May 13, 2009
2009 Investment Community Meeting
Authorization Controls
Specific
Specific
Merchants
Merchants
Transaction
Transaction
Limits
Limits
Curfews
Curfews
Geography
Geography
The Acquisition of Orbiscom
Routing Controls
Alert Controls
SMS/Email
SMS/Email
On Event
On Event
Forewarning
Forewarning
Credit
Debit
Installment
Home Equity
Line-of-Credit
Issuers
Corporations
Cardholders


49
May 13, 2009
2009 Investment Community Meeting
E-commerce: Online Channels Drive Growth


50
May 13, 2009
2009 Investment Community Meeting
Mobile: The Right Partnership Approach
Who Controls the
Winning Strategy?
Hardware designers
Application writers
SIM chip manufacturers
Mobile network operators


51
May 13, 2009
2009 Investment Community Meeting
P2P: Building the Framework


52
May 13, 2009
2009 Investment Community Meeting
can allow you to own the space
can allow you to own the space
Applications
Applications
Identifying the ‘Sweet Spot’
Technology
Technology
make it all possible
make it all possible
Innovation
is what our
customers want…
Innovation
is what our
customers want…
speeds
convergence
speeds
convergence
Platforms
Platforms
…and it’s what were delivering.
…and it’s what were delivering.


May 13, 2009
Financial Perspective
2009 Investment Community Day
Martina Hund-Mejean, Chief Financial Officer


54
Secular Shift from Cash and
Checks Continues Globally
2003 PCE
$22 trillion
2008 PCE
$33 trillion
Personal
Consumption
Expenditure
(PCE)
Estimated
to be
$38 trillion      
By
2013
Checks
18%
Cash
47%
Electronic Payments
(Cards and EFT)
35%
Electronic Payments
(Cards and EFT)
45%
Cash
44%
Checks
11%
US
5.5%
ROW
10.5%
WW
8.8%
2003 -
2008 CAGR
US
1.5%
ROW
3.2%
WW
2.7%
2008 -
2013 CAGR (
Est)
Source:, Economist Intelligence
Unit, Euromonitor
International


55
43.3
27.8
18.7
6.7
3.5
-10
50
US
Europe
APMEA
LAC
Canada
1Q09 Worldwide GDV Performance
%
Percentage Weight of 1Q09 MasterCard GDV
US
Europe
APMEA
LAC
Canada
Worldwide
Local Currency Growth
-8.0%
3.9%
16.1%
7.1%
-0.3%
0.3%
USD Growth
-8.0%
-16.1%
2.4%
-16.0%
-19.7%
-9.7%


56
-10%
-5%
0%
5%
10%
15%
1Q08
2Q08
3Q08
4Q08
1Q09
US Gross Dollar Volume, Purchase
Volume & Retail Sales
(1Q ‘07 –
1Q ‘09)
* Source: U.S. Department of Commerce (Unadjusted Retail & Food Services, excl. Auto)
US Retail
Sales*
MA
Purchase
Volume
MA GDV


57
US
Gross
Dollar
Volume
-
Credit
and
Debit
(1Q ’07 –
1Q ’09)
62%
38%
64%
36%
64%
36%
63%
37%
60%
40%
60%
40%
60%
40%
59%
41%
54%
46%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1Q07
2Q07
3Q07
4Q07
1Q08
2Q08
3Q08
4Q08
1Q09
MA
Debit
MA
Credit


58
Gasoline Volume Growth Scenarios - 2009
-50%
-40%
-30%
-20%
-10%
0%
10%
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Impact of Lower Current Gas Prices on
2009 US Processed Volumes for Gas
Actual
Scenarios
$3.00 /
gallon
$2.50 /
gallon
$2.10 /
gallon


59
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
1Q07
2Q07
3Q07
4Q07
1Q08
2Q08
3Q08
4Q08
1Q09
ROW Gross Dollar Volume, Purchase
Volume and Card Growth
(1Q ’07 –
1Q ’09)
Cards
Purchase
Volume*
GDV*
*Local currency basis


60
ROW Gross Dollar Volume Growth, by
Region
(1Q ’07 –
1Q ’09)
-5%
0%
5%
10%
15%
20%
25%
1Q07
2Q07
3Q07
4Q07
1Q08
2Q08
3Q08
4Q08
1Q09
APMEA
Latin
America
Europe
Canada
Local currency basis


61
Worldwide MasterCard Branded Cross Border
Volume and International Travel Growth
Source: International Air Transportation Association (IATA)
*Local currency basis
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
4Q06
1Q07
2Q07
3Q07
4Q07
1Q08
2Q08
3Q08
4Q08
1Q09
`
MA
Cross
Border*
IATA


62
Quarter-to-date Update
Processed volumes
Processed transactions
Cross border volume growth


63
Outlook for Full-Year 2009
Net revenue growth expected to fall below 12-15%
longer-term objective
Cross-border trends
Currency impact
Impact of deals on rebates & incentives
Total operating expenses expected to be flat to down
slightly, including impact of all severance charges
G&A
A&M
Thoughts on net income growth


64
Remain Committed to Our Longer-Term
Performance Objectives
Average
annual
net
revenue
growth
of
12
15%
Annual
Operating
Margin
improvement
of
3
-
5
ppt
Average
annual
net
income
growth
of
20
30%
Key assumptions
Constant FX rate
Effective annual tax rate of 35%


65
Strong Capital Position
Solid balance sheet
Healthy cash flow
generation
Flexibility for strategic
investments
Returned excess cash to shareholders primarily through
share repurchases
Completed $1.25 billion share repurchase program in 2008
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
2004
2005
2006
2007
2008
Book Equity
Cash & Investments


66
In Summary
Committed to our longer-term
objectives
Current environment
Realizing our potential


May 13, 2009
Question & Answer Session
2009 Investment Community Meeting