Mastercard Inc. Form 8-K Summary
Business Context and Reporting Period
This Current Report (Form 8-K) was filed by Mastercard Inc. on January 31, 2014. The filing announces the company's financial results for the fourth quarter and full year ended December 31, 2013. The report includes a press release and a conference call presentation as exhibits, which are furnished but not filed.
Key Financial Metrics
The filing text does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity. These figures are contained within the attached press release (Exhibit 99.1) and presentation (Exhibit 99.2), which are referenced but not included in the body of this 8-K.
The filing highlights the use of the following non-GAAP financial measures to evaluate ongoing performance:
- Total operating expenses, operating income, net income, and earnings per diluted share on a pro forma basis, excluding net incremental charges related to U.S. merchant litigations accrued in 2013 and 2012.
- Effective tax rate on a pro forma basis, excluding income tax benefits associated with the aforementioned litigation charges.
- Growth rates adjusted for currency fluctuations to provide relevant information on operational trends.
Material Changes and Unusual Items
The primary unusual item identified is the accrual of net incremental charges related to U.S. merchant litigations during the three-month period ended December 31, 2013, and the full years of 2013 and 2012. Management excludes these items from non-GAAP measures to facilitate a comparison of ongoing operations between periods.
Guidance, Outlook, and Management Commentary
Management indicated that non-GAAP measures are used for internal planning, forecasting, and performance-based compensation calculations. A conference call to discuss the fourth-quarter and full-year 2013 results was scheduled for January 31, 2014. The filing does not contain specific forward-looking guidance or risk factors beyond the standard disclosure regarding the use of non-GAAP measures.
Investor Verification Checklist
- Review Exhibit 99.1 (Press Release) for specific GAAP and non-GAAP revenue, net income, and EPS figures for Q4 and full-year 2013.
- Verify the reconciliation tables in the press release to understand the exact dollar impact of the U.S. merchant litigation charges excluded from non-GAAP results.
- Examine Exhibit 99.2 (Presentation) for management's commentary on currency impacts and growth rates.
- Confirm the specific amounts of the litigation accruals and associated tax benefits to assess their effect on reported margins.