Global Payments, Inc. (NYSE:GPN) recently reported its third quarter earnings and discussed the following topics in its earnings conference call.
Roman Leal – Goldman Sachs: Maybe we start with Canada and you know what, it’s good to hear you’re reaffirming the expectations of acceleration in the fourth quarter. But this quarter seemed a little bit weaker than what we were expecting. What gives you confidence in that, perhaps, can you walk us through what you saw maybe in January, February, March? Is the trend relatively improving over the last two months?
Jeffrey S. Sloan – President: Yeah, Roman, it’s Jeff. I’m going to start on Canada and David will certainly join me. So, the first thing, I’ll point to David’s commentary, in his prepared remarks is we saw a mid-single decline on spread in the quarter as he described. While we’re not what we want to be, as it relates to spread, that is an improvement as you had mentioned, Roman. That is an improvement in our performance in Canada that we’ve seen over the last number of quarters. So you may remember that in managing Canada, it’s a mix of spread, transaction growth, the economic environment, new sales and controllable costs. Spread has been a big driver over the last number of quarters in terms of results and that mid-single decline that David referenced is important to note. The second thing I would say that we saw in the quarter is a change and a decline in volumes. So, when you look at volume in Canada, and now I’m talking about specifically Visa volume, not just the Global Payments but for the whole country of Canada for Visa we saw a deceleration in those volumes that also impacted at the margin the results that you refer to in the quarter. So we feel like we are tracking well from share point of view against those metrics but we certainly saw a weakening of Visa volume not specific to Global in the quarter. So when we think about the fourth quarter that David alluded to in his prepared remarks we think we have seen some progress, not what we wanted it to be but some progress on spread declines a little bit weaker than economy as reflected in the Visa volumes and in the actions that we have talked about before for the fourth quarter that should help us finish the year as we alluded to. David you want to?
David Mangum – SEVP and CFO: Yes. Just to add a little more color to that. Obviously in the fourth quarter you have heard us say before it’s a pretty important quarter to watch the spread trends and make sure that what we saw annualizing early in the calendar year in terms of the big spread declines from last year really do start to coming in sort of a more manageable level to which you hopefully then can marry transaction growth, which we unfortunately didn’t see in Q3; to then the other opportunities of managed economics of the business with the new assessments coming out and the new opportunities to manage around those assessments, for hopefully greater economic return, in the fourth quarter…
Jeffrey S. Sloan – President: So I would just add to what David said Ron in that we remain pleased with our new direct sales in Canada including in particular some large accounts that we have won recently. So you marry that all together we feel confident in heading into the fourth quarter of fiscal ’13.
Roman Leal – Goldman Sachs: Then this is a follow-up. In international it seems like the margins were unusually strong last quarter, maybe usually weak this quarter. Was there – is there something in regards to timing or seasonality that perhaps we missed there? What drove the margins in international?
Paul R. Garcia – Chairman and CEO: We have the typical seasonality that happens in every Q3 really around the business. Whether you are talking about North America or most of our assets around the world, you have heard me even say that, even Russia actually sees seasonally light third quarter, as odd as that may sound, even think about a high growth business like that, a high growth market like that. When you start to think about international margins for the quarter in isolation, I would point you back to we did talk about last quarter that the margins would be down a little bit in the third quarter when compared to previous, and really the two key pieces to that when we have looked ahead, and they sort of essentially came through. The margin again right about what where we expected, maybe a little more EBIT dollars in total than we expected, given some of the mix issues I will talk about in a second. So, the declines in Q3 really in international margins are driven by continued sluggish revenue growth in Asia where we continue to see volumes running far shy of what we hoped to see at the beginning of the year. Again, lots of macro involved in that. Of course, remember we saw average tickets decline in the summer and we are seeing soft transactions and resultant soft volume across Asia. With that Asia is one of our main scale drivers over the last three years of the Company’s margin performance particularly in international, when that then hangs around low single-digit is not scaling margins and has a drag on total international margins. At the same time, we’re seeing really different revenue mix in the United Kingdom and this started to show through in the income statement in the second quarter, when we saw outsized growth in general in Europe. Talked about that being fueled by United Kingdom business, out of which we run a product to a platform we called international acquiring, which is the processing of cross-border e-commerce transactions on behalf of a number of merchants that aren’t quite large, but any number of others, we signed about 30 more for that platform in this year alone. Now, that business drives a great growth on the top line but operates at a lower contribution margin or incremental margin than our core credit and debit processing products in the U.K., so, again great revenue growth. We’re seeing terrific revenue growth and we see that in the top line, we look at the Europe growth Q2 and Q3 year-over-year that will continue to grow we think with secular trends on transactions and with new merchant signs to continue to add more and more to the platforms I referenced earlier. So, between those two you’ve got a couple of things that are headwinds married to perfectly fine margins and nice progress across the region in general when you think about our international businesses. So the margins in the other markets are just fine. I think as you look ahead to Q4, we’re looking to see some sequential improvement in the fourth quarter. We swing toward a more seasonally strong quarter in the fourth quarter. That’s true again, across the board just as Q3 was across the board. We will continue to expect solid mid-single-digit growth in EBIT for the full year and that’s held down as you well know on a year-over-year basis by currency.
North America Margins
David Koning – Robert W. Baird: I guess my first question. Last quarter I think you talked about North America margin being more or less flat sequentially. I know it ended up being down about close to 200 basis points. I guess just figuring out where the disparity between those came from.
David Mangum – SEVP and CFO: I think if you look at North America. We may be best to marry it to the international commentary I just gave an answer to Roman’s follow-up question. If you look at the total Company for the quarter, lots of puts and takes, as there always are in a business this large and this complex. So little bit more performance than might have expected from international U.K. especially, maybe a little bit less in North America quite honestly, and little less in Canada. We had the nice metric of just mid-single-digit declines in spread, which we’re cautiously optimistic portends better things as we go forward. On the other hand, Canada still had its revenue declined 7% in local currency and that’s a clear wind as you enter the quarter. If you go to puts and takes really across North America that little bit shy on just overall performance with the revenue decline in Canada a little north of what we thought. If you marry that then, we got U.S. revenue, kind of right on what we expected for the quarter, maybe a little bit shy, but perfectly fine putting in lots of puts and takes in any given quarter. So, the Canada revenue declined, with really strong ISO growth, which always puts more pressure on the margins. We continue to have that on an annualized basis. The movement of CyberSource up from an indirect model to the ISOs, the tech spending continued, and our expenses increased in Brazil as well. All that offset by the positive impact of APT. And I should probably pause here for a second and remind you; we talked about APT helping margins to the tune of 50 basis points total Company and 70 basis points for North America for the full year. It’s running a little bit ahead of that, but it’s running now in the phase of a little bit more challenging situation in Canada we might have thought going into the quarter and then just sort of the same general performance you’re used to where ISOs can drive a lot of margin swings just inside of each in every given quarter. So, when we look out at the fourth quarter, which maybe the best way to answer your question, I think – I do expect to see some margin improvement in the fourth quarter, maybe returning to the levels we saw kind of in the first half of the year, if you kind of average Q1 and Q2, maybe back toward those levels. And that’s really driven by a typical Q4 in Global Payments; seasonal revenue improvements as usual in our direct channels and then gaining and are greater giving, where, as you’ll recall, we’ll do 50% of the full year revenue in the fourth quarter alone. And then, you just probably expect us to do the traditional fourth quarter pricing actions we do in that business every year as you get your bulletins from the networks and work around those…
David Koning – Robert W. Baird: And then just my follow-up then, if Canada – I mean, should that be sustainable growth going forward now, and if so then, I mean can we expect EBIT to grow in North America in fiscal ’14 behind that and APT?
David Mangum – SEVP and CFO: Well, I think you’re ahead of the game when we’re talking about fiscal ’14. I would say this, that what we’ve talked about before when you deal with Canada, you’ve got, well, North American utility, you’ve got APT coming in, you’ve got the U.S. business, you got some trends that will normalize in general terms of our investment spending, hopefully in places like Brazil in technology and then in Canada comes down to, do we continue to have more manageable spreads that allow us to offset those sort of core spread declines with transaction growth and with any other creative economic things we can do in and around pricing with assessments, and those are the pieces that hopefully we have much more in our toolkit as we enter Q4 than we had two months ago.
Paul R. Garcia – Chairman and CEO: Let me add something to – if I could David. Dave this is Paul Garcia. Clearly, we understand that our job is as management is to grow our company and all of our areas and while we’re not prepared to give any FY ’14 guidance, I just want you to know that we certainly understand the charge at hand and we’re very focused on doing just that.