8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 17, 2004

Commission file number 001-16111

GLOBAL PAYMENTS INC.

(Exact name of registrant as specified in charter)

Georgia	58-2567903
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
10 Glenlake Parkway, North Tower, Atlanta, Georgia	30328
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: 404-728-2719

NONE

(Former name, former address and former fiscal year, if changed since last report)

Item 7. Financial Statements and Exhibits

(c) Exhibits

Exhibit Number	Description
99.1	Press Release dated March 17, 2004

Item 12. Results of Operations and Financial Condition

On March 17, 2004, Global Payments Inc., a Georgia corporation, announced results for the quarter ended February 29, 2004. A copy of the press release announcing the results is attached hereto as Exhibit 99.1.

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Global Payments Inc.
	(Registrant)
Date: March 17, 2004	By:	/s/ James G. Kelly
		James G. Kelly
		Chief Financial Officer
		(Principal Financial Officer and Chief Accounting Officer)

3

EX-99.1

Exhibit 99.1

Contact: Jane M. Forbes

770-829-8234 Voice

770-829-8267 Fax

investor.relations@globalpay.com

Global Payments Reports Third Quarter Earnings

ATLANTA, March 17, 2004 — Global Payments Inc. (NYSE: GPN) today announced results for the third quarter ended February 29, 2004. Revenue grew 30 percent to $162.6 million compared to $124.6 million in the prior year. This includes $18.3 million in revenue recorded in the current quarter as a result of our recent acquisitions, which primarily consists of DolEx and, to a lesser extent, the MUZO acquisition which was announced on February 20, 2004. Net income grew 36 percent to $16.5 million compared to $12.1 million in the prior year quarter and diluted earnings per share grew 31 percent to $0.42 compared to $0.32 in the prior year quarter.

For the nine months ending February 29, 2004, revenue grew 17 percent to $447.5 million compared to $381.8 million in the prior year period. Net income grew 24 percent to $50.1 million from $40.3 million in the prior year period and diluted earnings per share grew 21 percent to $1.29 from $1.07 in the prior year period, excluding a restructuring charge of $2.9 million, net of tax or $0.07 per share in the current year period. Year-to-date GAAP net income and diluted earnings per share were $47.2 million and $1.22, respectively.

Comments and Outlook

Chairman, President and CEO, Paul R. Garcia, stated, “This quarter marks our official entrance into the growing European payments market through our acquisition of MUZO, and we are excited about the expansion opportunities it will provide to us throughout this region. We are delighted with our strong quarterly results, which were primarily driven by high-teen transaction growth in our ISO and domestic direct distribution channels. In addition, we now have a full quarter of DolEx included in our results and are very pleased with the performance of this important channel. Lastly, we continue to gain operating leverage through greater economies of scale and the ongoing consolidation of operating functions. As a result, we are raising our fiscal 2004 annual revenue guidance of $597 million to $617 million to a range of $610 million to

-More

Global Payments Reports Third Quarter Earnings

March 17, 2004

Page 2

Comments and Outlook, continued

$620 million, reflecting growth of 18 percent to 20 percent versus $516 million in fiscal 2003. In addition, we are raising our fiscal 2004 annual diluted earnings per share guidance of $1.66 to $1.73 to a range of $1.71 to $1.74, reflecting growth of 20 percent to 22 percent versus prior year results of $1.43 per share, excluding restructuring charges.”¹

Conference Call

Global Payments will hold a conference call on March 18, 2004 at 10:30 a.m. EST to discuss financial results and business highlights. The conference call can be accessed by calling 1-888-428-4480 (U.S.) or 1-651-291-5254 (internationally), or via Web cast at www.globalpaymentsinc.com. A replay of the call will be available on the Global Payments Web site through March 31, 2004.

Global Payments Inc. (NYSE:GPN) is a leading provider of electronic transaction processing services for consumers, merchants, Independent Sales Organizations (ISOs), financial institutions, government agencies and multi-national corporations located throughout the United States, Canada, Latin America and Europe. Global Payments offers a comprehensive line of processing solutions for credit and debit cards, business-to-business purchasing cards, gift cards, check guarantee, check verification and recovery, as well as terminal management and money transfer services. For additional information about the company and its services, visit www.globalpaymentsinc.com.

¹ The fiscal 2003 diluted earnings per share of $1.41 on a GAAP basis reflects restructuring charges of $0.8 million, net of tax, or $0.02 diluted earnings per share. Restructuring charges through the nine month period ended February 29, 2004 were $2.9 million, net of tax, or $0.07 diluted earnings per share. We anticipate to incur additional restructuring charges during the balance of fiscal 2004, relating to the activities announced in our fourth quarter of fiscal 2003.

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This announcement and comments made by Global Payments’ management during the conference call may contain forward-looking statements pursuant to the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements involve risks and uncertainties such as product demand, market and customer acceptance, the effect of economic conditions, competition, pricing, development difficulties, foreign currency risks, costs of capital, continued certification by credit card associations, the ability to consummate and integrate acquisitions, and other risks detailed in the Company’s SEC filings, including, but not limited to, our most recent report on Form 10-Q. The Company undertakes no obligation to revise any of these statements to reflect future circumstances or the occurrence of unanticipated events.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except per share data)

	Three Months Ended February 29/28,
	2004			2003
Revenues	$	162,560		$	124,573
Operating expenses:
Cost of service		71,773			62,682
Sales, general and administrative		60,355			40,108
		132,128			102,790
Operating income		30,432			21,783
Other income (expense):
Interest and other income		466			219
Interest and other expense		(2,337	)		(1,172	)
Minority interest		(2,198	)		(1,505	)
		(4,069	)		(2,458	)
Income before income taxes		26,363			19,325
Provision for income taxes		9,860			7,228
Net income	$	16,503		$	12,097
Earnings per share:
Basic	$	0.44		$	0.33
Diluted	$	0.42		$	0.32
Weighted average shares outstanding:
Basic		37,725			36,993
Diluted		39,329			37,894

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except per share data)

	Nine Months Ended February 29/28,
	2004			2003
Revenues	$	447,471		$	381,762
Operating expenses:
Cost of service		201,209			193,963
Sales, general and administrative		157,842			116,945
Restructuring		4,703			—
		363,754			310,908
Operating income		83,717			70,854
Other income (expense):
Interest and other income		1,219			733
Interest and other expense		(3,972	)		(3,380	)
Minority interest		(5,564	)		(3,842	)
		(8,317	)		(6,489	)
Income before income taxes		75,400			64,365
Provision for income taxes		28,200			24,072
Net income	$	47,200		$	40,293
Earnings per share:
Basic	$	1.26		$	1.09
Diluted	$	1.22		$	1.07
Weighted average shares outstanding:
Basic		37,444			36,914
Diluted		38,832			37,769

CONSOLIDATED CONDENSED BALANCE SHEETS

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands)

	February 29, 2004		May 31, 2003
	(Unaudited)
Assets
Cash and cash equivalents	$	85,890	$	38,010
Accounts receivable, net		47,932		44,929
Claims receivable, net		631		608
Net settlement processing receivable		79,637		68,070
Other current assets		19,696		10,486
Current assets		233,786		162,103
Property and equipment, net		92,400		51,785
Goodwill		327,401		161,216
Intangible assets, net		187,769		137,898
Other assets		10,519		5,132
Total assets	$	851,875	$	518,134
Liabilities & Shareholders’ Equity
Line of credit	$	161,000	$	—
Line of credit with related party		82,701		33,900
Accounts payable and other accrued liabilities		79,320		61,405
Obligations under capital leases		1,161		1,456
Current liabilities		324,182		96,761
Notes payable		11,994		—
Obligations under capital leases		2,370		3,251
Other accrued liabilities		53,115		28,455
Total liabilities		391,661		128,467
Minority interest in equity of subsidiaries		31,893		23,241
Shareholders’ equity		428,321		366,426
Total liabilities & shareholders’ equity	$	851,875	$	518,134

UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands)

	Nine Months Ended February 29/28,
	2004			2003
Cash flows from operating activities:
Net income	$	47,200		$	40,293
Non-cash items
Restructuring		387			—
Depreciation and amortization		25,101			24,226
Minority interest in earnings		5,564			3,842
Other, net		5,840			7,769
Changes in working capital, which provided (used) cash
Settlement processing		(17,885	)		(30,877	)
Other, net		2,600			7,608
Net cash provided by operating activities		68,807			52,861
Cash flows from investing activities:
Capital expenditures		(15,042	)		(12,707	)
Business acquisitions, net of cash acquired		(94,965	)		(1,153	)
Net cash used in investing activities		(110,007	)		(13,860	)
Cash flows from financing activities:
Net borrowings (payments) on line of credit		161,000			(22,000	)
Net borrowings on line of credit restricted for merchant funding		48,801			—
Principal payments under capital leases and other notes		(115,694	)		(1,991	)
Net stock issued to employees under stock plans and dividends		164			(965	)
Distributions to minority interests		(6,674	)		(5,340	)
Net cash provided by (used in) financing activities		87,597			(30,296	)
Effect of exchange rate changes on cash		1,483			1,469
Increase in cash and cash equivalents		47,880			10,174
Cash and cash equivalents, beginning of period		38,010			19,194
Cash and cash equivalents, end of period	$	85,890		$	29,368

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

GLOBAL PAYMENTS INC. AND SUBSIDIARIES

(In thousands, except per share data)

	Nine Months Ending February 29, 2004
	Normalized			Restructuring1			GAAP
Revenue	$	447,471		$	—		$	447,471
Operating expenses:
Cost of service		201,209			—			201,209
Sales, general and administrative		157,842			—			157,842
Restructuring		—			4,703			4,703
		359,051			4,703			363,754
Operating income		88,420			(4,703	)		83,717
Other income/(expense)
Interest and other income		1,219			—			1,219
Interest and other expense		(3,972	)		—			(3,972	)
Minority interest in earnings		(5,564	)		—			(5,564	)
		(8,317	)		—			(8,317	)
Income before income taxes		80,103			(4,703	)		75,400
Provision for income taxes		29,959			(1,759	)		28,200
Net income	$	50,144		$	(2,944	)	$	47,200
Basic shares		37,444			—			37,444
Basic earnings per share	$	1.34		$	(0.08	)	$	1.26
Diluted shares		38,832			—			38,832
Diluted earnings per share	$	1.29		$	(0.07	)	$	1.22

¹ Primarily relating to severance and facilities due to redundant activities and facility closures, as well as the related income tax benefit using the company’s effective tax rate.