MEMPHIS, Tenn. -- Transaction processor Concord EFS Inc. (NasdaqNM:CEFT - News) said its quarterly earnings rose as transactions -- especially PIN-secured debit -- increased, but it warned of a dip in business as consumer spending slows.
According to a Reuters report, its shares were trading down $2.65, or 16.6 percent, at $13.33 on Nasdaq early on Oct. 29.
Concord's third-quarter net income was $94.3 million, or 18 cents per share, compared with $81.5 million, or 16 cents per share, in 2001's third quarter. Revenues rose from $436.2 million in 2001's third quarter to $568.3 million in 2002's third quarter.
Concord reported earnings of 17 cents a share excluding a one-time gain from a legal settlement that was cheaper to settle than anticipated. That hit Wall Street's average forecast, with estimates ranging from 16 cents to 17 cents, according to analysts polled by research firm Thomson First Call.
In a news release, Concord reported that PIN-secured debit outpaced every other transaction category, growing in excess of 35 percent in 2002's third quarter. "In fact, year-to-date acquired debit transactions have already exceeded full year 2001 acquired debit volume," said Concord president Edward Labry in the release.
However, Concord warned that business could slow in line with consumer spending.
"September volume was somewhat lower than expected," Labry said in the release. "This was consistent with the overall slowdown in consumer spending, and we will be closely monitoring the economy's impact on transaction volumes in the coming months."
Concord also announced that it had completed the final phase of a previously announced plan to consolidate its network switch processing. All switching for Concord's Star network is now performed in-house, according to the release.
