Alliance Data Systems, an issuer and processor of private label credit cards, reported yesterday its first quarter revenue increased seven percent to $499.3 million compared with $466.3 million for the first quarter of 2007. Net income fell to $49.3 from $56.9 million, due to costs related to the failed merger by Blackstone Group ("Alliance Data Seeks $170 Million from Blackstone as Deal Ends," April 21).
The Private Label Credit division reported revenues of $209.1 million, down from $219.8 million a year ago, due to the loss of the Lane Bryant portfolio and, “to a lesser degree, a modest increase in credit losses,” the company reported. Total sales for the private label group were down from $1.6 billion to $1.5 billion. Average managed receivables were flat at $3.9 billion.
Dallas-based Alliance Data (NYSE: ADS) reported its card delinquency rates “have remained stable over the past eight months.” Although credit losses could be about $20 million higher than the firm has budgeted for, Alliance Data is projecting savings of $30-35 million on funding costs
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