29 Jul 2022 09:21

Mastercard posts loss of $26 mln due to exit from Russia in Q2

MOSCOW. July 29 (Interfax) - Mastercard took a pre-tax net charge of $26 million in the second quarter that was directly related to imposed sanctions and the suspension of the company's business operations in Russia, the company said in its financial statement.

The net charge is comprised of general and administrative expenses of $33 million, primarily related to incremental employee related costs, offset by a net benefit of $6 million in rebates and incentives, Mastercard said.

Mastercard's loss due to its exit from Russia could total $37 million in 2022, the company forecast. The company took a pre-tax charge of $4 million in the first quarter due to the suspension of operations in Russia. Most of the expenses were related to reserves on customer balances, which were subject to sanctions.

Mastercard reported net profit up 10% to $2.3 billion in the second quarter of 2022 on revenue up 21% to $5.5 billion, from respectively $2.1 billion and $4.5 billion a year earlier.

Mastercard announced at the beginning of March that it was suspending operations in Russia due to the situation in Ukraine. As of March 10, Mastercard cards issued in Russia do not work outside of the country and are not accepted for payments by foreign online stores. Within Russia, such cards still work, as transactions are processed by the National Payment Card System (NPCS). Russia accounted for about 4% of Mastercard's revenue in 2021.