First Data Reports Strong Third Quarter Results

DENVER, CO – First Data Corp. (NYSE: FDC) delivered another strong quarter, with earnings per share (EPS) from continuing operations of $0.54. Comparable third quarter 2003 EPS from continuing operations were $0.48. Revenue grew 21% to $2.5 billion. Net cash provided by operating activities for the quarter was $750 million.

“The point-of-sale activity for Western Union money transfers and merchant transactions continues to be the major contributor to our strong operating performance,” said Charlie Fote, chairman and chief executive officer. “We continue to be pleased with the addition of Concord to the First Data family. Its performance is helping drive First Data results. Additionally, we will achieve our $30 million in synergy savings related to the Concord integration for this year.”

Third quarter 2004 results included $0.03 of charges, which were comprised of integration expenses and other charges that impacted EPS by $0.02 and $0.01, respectively.

Significant company news in the quarter included Washington Mutual, Inc.’s extension of its relationship with the STAR® Network and the announcement of Bank of America’s intent to extend and expand its relationship across all segments of First Data.

The Western Union money transfer business had another outstanding quarter posting revenue growth of 13% to $861 million, with profits up 16% to $296 million.

A significant milestone in the quarter was the opening of the 200,000th money transfer location. This far-reaching global network supported strong consumer demand, which yielded consumer-to-consumer transaction growth of 18%, led by international growth of 23% and Mexico growth of 14%.

Overall, the Payment Services segment delivered in-line results growing revenue 10% to $1.0 billion and delivered operating profit of $332 million. Operating margin remained strong at 33%, led by Western Union.

Merchant Services’ results were driven by 65% transaction growth. Revenue was $983 million, up 47%, and operating profit of $248 million grew 37%. Segment margin remained healthy at 25%.

Card Issuing Services’ revenue and operating profit were $620 million and $154 million, respectively. The Card team’s focus on smooth conversions has brought the total new accounts converted for the year to 51 million. The total pipeline stands at approximately 50 million accounts, of which more than 40 million are scheduled to be converted by the end of the first quarter 2005.

During the quarter, the company repurchased 28.4 million shares of stock for $1.2 billion at an average price of $42.34 per share. Yesterday, the board approved an additional $1.5 billion in new authorization bringing the company’s current authorization for stock repurchases to nearly $2 billion.

About First Data
First Data Corp., with global headquarters in Denver, helps power the global economy. As a leader in electronic commerce and payment services, First Data serves approximately 3.5 million merchant locations, 1,400 card issuers and millions of consumers, making it easy, fast and secure for people and businesses around the world to buy goods and services using virtually any form of payment. With more than 30,000 employees worldwide, the company provides credit, debit, private-label, smart and stored-value card issuing and merchant transaction processing services; Internet commerce solutions; money transfer services; money orders; and check guarantee and verification services. The STAR® Network offers PIN-secured debit acceptance at one million point-of-sale locations and 260,000 ATMs nationwide. First Data also offers a variety of payment services to businesses around the world including those in the United Kingdom, Australia, Canada, Japan, Mexico, Spain, Panama, Brazil, China, the Netherlands, the Middle East and Germany. Its Western Union and Orlandi Valuta money transfer networks include approximately 202,000 agent locations in more than 195 countries and territories. Visit www.firstdata.com for more information.

Notice to Investors, Prospective Investors and the Investment Community Cautionary Information Regarding Forward-Looking Statements – Statements in this press release regarding First Data Corporation’s business which are not historical facts, including the revenue and earnings projections, are “forward-looking statements.” All forward-looking statements are inherently uncertain as they are based on various expectations and assumptions concerning future events and they are subject to numerous known and unknown risks and uncertainties which could cause actual events or results to differ materially from those projected. Important factors upon which the Company’s forward-looking statements are premised include: (a) no unanticipated developments that delay or negatively impact the integration of Concord EFS, Inc. according to the Company’s integration plans, including its plans to integrate IT systems, eliminate duplicative overhead and costs, and retain customers and critical employees; (b) continued growth at rates approximating recent levels for card-based payment transactions, consumer money transfer transactions and other product markets; (c) successful conversions under service contracts with major clients; (d) renewal of material contracts in the Company’s business units consistent with past experience; (e) timely, successful and cost-effective implementation of processing systems to provide new products, improved functionality and increased efficiencies; (f) successful and timely integration of significant businesses and technologies acquired by the Company and realization of anticipated synergies; (g) continuing development and maintenance of appropriate business continuity plans for the Company’s processing systems based on the needs and risks relative to each such system; (h) absence of further consolidation among client financial institutions or other client groups which has a significant impact on FDC client relationships and no material loss of business from significant customers of the Company; (i) achieving planned revenue growth throughout the Company, including in the merchant alliance program which involves several joint ventures not under the sole control of the Company and each of which acts independently of the others, and successful management of pricing pressures through cost efficiencies and other cost management initiatives; (j) successfully managing the credit and fraud risks in the Company’s business units and the merchant alliances, particularly in the context of the developing e-commerce markets; (k) anticipation of and response to technological changes, particularly with respect to e-commerce; (l) attracting and retaining qualified key employees; (m) no unanticipated changes in laws, regulations, credit card association rules or other industry standards affecting FDC’s businesses which require significant product redevelopment efforts, reduce the market for or value of its products or render products obsolete; (n) continuation of the existing interest rate environment so as to avoid increases in agent fees related to Payment Services’ products and increases in interest on the Company’s borrowings; (o) absence of significant changes in foreign exchange spreads on retail money transfer transactions, particularly in high-volume corridors, without a corresponding increase in volume or consumer fees; (p) continued political stability in countries in which Western Union has material operations; (q) implementation of Western Union agent agreements with governmental entities according to schedule and no interruption of relations with countries in which Western Union has or is implementing material agent agreements; (r) no unanticipated developments relating to previously disclosed lawsuits, investigations or similar matters; (s) no catastrophic events that could impact the Company’s or its major customer’s operating facilities, communication systems and technology or that has a material negative impact on current economic conditions or levels of consumer spending; (t) no material breach of security of any of our systems; and (u) successfully managing the potential both for patent protection and patent liability in the context of rapidly developing legal framework for expansive software patent protection.