On Feb. 9, MasterCard (NYSE:MA) released fourth-quarter earnings for the period ended Dec. 31.

  • Results were strong across the board, including a 17.2% increase in sales, a 16.7% increase in purchase volume to $391 billion, a 17.4% increase in processed transactions, and a 12.3% increase in total card issuance. There are now 817 million MasterCards worldwide.
  • According to MasterCard's CEO, "Cardholders around the world used their MasterCard cards for transactions totaling almost $2 trillion in 2006 -- doubling the GDV [gross dollar volume] we reported only five years ago...."
  • Operating expenses, excluding special items, increased 0.5%. Net income swung to $41 million from a $53 million loss last year.
  • Despite the great numbers, the stock is down 8% as of this writing -- the Street is worried about margins. The company benefited from pricing increases in 2006, but it doesn't plan for any major pricing increases in 2007. MasterCard's CFO mentioned that the company could experience margin pressures.

(Figures in thousands, except per-share data)

Income Statement Highlights

Q4 2006

Q4 2005

Change

Sales

$839,163

$715,918

17.2%

Net Profit

$40,902

($52,908)

N/A

EPS

$0.30

($0.39)

N/A

Diluted Shares

135,700

134,969

0.5%



Get back to basics with a look at the income statement.

Balance Sheet Highlights

Assets

Q4 2006

Q4 2005

Change

Cash

$1,185,080

$545,273

117.3%

Investments

$1,286,580

$714,147

80.2%

Total Current Assets

$3,577,229

$2,227,898

60.6%

Total Assets

$5,082,470

$3,700,544

37.3%



Liabilities

Q4 2006

Q4 2005

Change

Current Liabilities

$1,811,590

$1,556,703

16.4%

Total Liabilities

$2,713,491

$2,526,776

7.4%

Equity (Book Value)

$2,364,359

$1,169,148

102.2%



Learn the ways of the balance sheet.

Cash Flow Highlights

Q4 2006

Q4 2005

Change

Cash From Ops.

$650,161

$272,848

138.3%

Capital Expenditures

$61,204

$43,866

39.5%

Free Cash Flow

$588,957

$228,982

157.2%



Find out why Fools always follow the money.

Related Companies:

  • American Express (NYSE:AXP)
  • Capital One Financial (NYSE:COF)
  • CompuCredit (NASDAQ:CCRT)

Related Foolishness:

MasterCard is a Motley Fool Inside Value recommendation. Discover more of the market's best bargains with a free 30-day trial subscription.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

Fool contributor Emil Lee is an analyst and a disciple of value investing. He does not own any of the shares mentioned. The Motley Fool has a disclosure policy.