Presentation Transcript
Global Update: Global Update Robert W. Selander March 17, 2005
MasterCard Global Board of Directors Confidential
Overview: Overview 2004 Results / 2005 Priorities (Bob)
Strategy Implementation Update (Alan)
GTO’s Support of Strategy (Roy)
2004 Corporate Objectives: 2004 Corporate Objectives
Improve performance key customers/key markets
Improve customer-focused strategy
Achieve corporate financial targets
Enhance organizational capabilities
2004 Results: Improve Performance Key Customers/Markets 2004 Results Worldwide GDV: $1.5 trillion, up 10.6%
MasterCard-branded cards: 679.5 million, up 8.6%
Maestro cards: 562.6 million, up 8.0%
Transactions: Nearly 16.7 billion Acceptance locations: 24 million
Business Build Program Momentum
MasterCard Advisors Continued to gain ground
Slide5: 4Q04 Worldwide Performance 5.3% 5.8% MasterCard branded including credit, charge, and offline debit. Includes China. 8.6% 12.5% GDV and Card Growth Rates (YAG)
2004 Results: 2004 Results
Improve Customer-Focused Strategy
GTO
MasterCard Rewards System enhanced
Flawless Switch processing
New tiered debit interchange program
Hit 1 billion transactions in December
Computerworld “Best Places to Work” list
2004 Results: 2004 Results Enhance Organizational Capabilities
Key Initiatives
Significant legal wins
Compliance with Sarbanes-Oxley 404
Employee Engagement Survey
MasterCard recognized as a top workplace
2004 Results: 2004 Results Improve Customer-Focused Strategy
Other Initiatives
Global debit growth
Corporate payments growth
Over 200 million smart cards worldwide
PayPass momentum
Diner’s Club alliance
25th anniversary of the MasterCard brand
Select Income Statement Data: Select Income Statement Data 1 1 1 1 Operating loss includes $469 and loss per share includes $4.69 for costs related to the settlement of the U.S. merchant lawsuit
2005 Financial Performance to Date: 2005 Financial Performance to Date [Jan. and Feb. Financial slide to be inserted.]
2005 Corporate Objectives: 2005 Corporate Objectives Implement Corporate Strategy
Customer-Focused Strategy
Merchant Plans
Processing Plans
Achieve Financial Targets
Revenue growth
EBITDA
Operating Expenses as % of Revenue
Return on Equity
2005 Corporate Objectives: 2005 Corporate Objectives Enhance Organizational Capabilities
Affirmatively address legal & regulatory environment
Proactively manage HR assets and implement Employee Engagement Survey action plans
Institutionalize compliance with Sarbanes Oxley
Complete Integration plan
Develop and implement a share-transfer process
Finalize share/proxy and complete all systems
Implement Enterprise Risk Management
Corporate Strategy: Corporate Strategy Continue customer-focused approach
Focus on 73 high-potential customers
Better leverage our expertise
Emphasize processing opportunities
Recognize merchants as key stakeholders
Slide14: Customer Group
Alan Heuer
Strategy Development: Strategy Development
Affirmation of Customer Focus: Affirmation of Customer Focus Build competitive advantage around the way we work with customers and the value we bring them
Three Mandates: Three Mandates Extend target group
Leverage expertise
Engage merchants
Extension of Target Group: Extension of Target Group Account teams
Planning process
Metrics
Leverage Expertise: Leverage Expertise Product
Advisors
Marketing
Technology
Engage Merchants: Engage Merchants Regional organization
Advisory groups
Rules and processes
Key Steps: Key Steps Organization and staffing
Integrated customer planning
Strategic review
CRM
Joint objectives
Control and reporting
Staffing: Staffing New positions 320
Reallocations 100
New hires 80
Open positions 140
Slide23: Right people
Right skills
Right roles People Right results
Slide24: New process defined
2006 planning begun
Communications and road shows in progress
First Strategy Summit planned for May Integrated Customer Planning
Slide25: Industry trends
Competitive challenges
Technology developments
Product priorities Strategic Review Identify key opportunities for MasterCard
Slide26: Approach for engaging customers
Understand customers’ competitive strategies
Identify customer needs
Apply MasterCard’s resources CRM
CRM Rollout: CRM Rollout Status Update
Road shows completed
B-Smart capabilities being extended
Research in field
Sales training under development
Slide28: Brand
High-Potential Products
Advisors
Merchants
Processing Joint Objectives Corporate Joint Objectives
Slide29: Joint Objectives Status Update
Agreed on objectives with Operating Committee
Established specific terms of reference
Agreed to true joint accountability
Linked to sales and business unit compensation
Control and Reporting: Control and Reporting Status Update
Control and reporting mechanism established
Detailed implementation plans against key milestones
Formal “report back” process to Operating Committee
Customer “snapshots” built into B-Smart
Affirmation of Customer Focus: Affirmation of Customer Focus Build competitive advantage around the way we work with customers and the value we bring them
Slide32: Global Technology and Operations
Roy Dunbar
Delivering Value With Every Transaction: Delivering Value With Every Transaction
Where We Are Going: Where We Are Going After the new corporate strategy was announced, GTO began to define its role relative to the strategy.
We began considering how we could articulate our role, and what initiatives were required to deliver our part of the strategy.
Our Mission: Our Mission To make every transaction more valuable.
Our Mission: Our Mission A transaction is more valuable when:
It carries a MasterCard brand.
MasterCard processes it.
It improves profitability for us and our stakeholders.
It is a secure, reliable, convenient and rewarding experience.
It provides rich information for everyone in the value chain.
Brilliant at the Basics: Brilliant at the Basics 1.
We think like a customer: We think like a customer
Secure the future through processing: Secure the future through processing
Differentiate in order to win: Differentiate in order to win
Our foundational value: Our foundational value Internal Partnership
Summary: Summary
MasterCard is firmly positioned for growth
Focused on delivering enhanced value to customers
New strategy will help us deliver a higher level of performance