This excerpt taken from the GPN 10-Q filed Apr 6, 2009.
Risks associated with foreign currency exchange fluctuations could adversely affect our business, financial position and results of operations.
We are exposed to foreign currency risks resulting from changes in currency exchange rates because of our international operations in the United Kingdom, Canada, the Czech Republic, and throughout the Asia-Pacific region, as well as our significant electronic money transfer operations in the United States and Europe. Volatility in currency exchange rates has affected and may continue to affect our financial results. For example, for the three months ended February 28, 2009, currency exchange rate fluctuations reduced our revenues by $35.4 million and our earnings by $0.10 per diluted share. For the nine months ended February 28, 2009 currency exchange rate fluctuations reduced our revenues by $50.2 million and our earnings by $0.14 per diluted share. To calculate this we converted our fiscal 2009 actual revenues at fiscal 2008 rates. We do not use forward contracts or other derivative instruments to mitigate the risks associated with fluctuating exchange rates. Further fluctuations in currency exchange rates could adversely affect our results of operations in future periods.
Risks associated with reduced levels of consumer spending could adversely affect our revenues and earnings.
Significant portions of our revenue and earnings are derived from fees from processing consumer credit card and debit card transactions and electronic money transfer transactions. We are exposed to general economic conditions that effect consumer confidence, consumer spending, consumer discretionary income or changes in consumer purchasing habits. A general reduction in consumer spending in the United States or any other country where we do business could adversely affect our revenues and earnings. For example, in the three and nine months ended February 28, 2009 compared to the prior years comparable period, our United States direct credit card average dollar value of transaction, or average ticket, decreased in the high single digit percentage range. We believe this decline, while partially due to a shift toward smaller merchants added through our ISOs, was in part driven by lower consumer spending as a result of a weakened economy, and we expect this trend to continue for the remainder of the fiscal year.