American Express 2003 Annual Report Download - page 8

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Now more than ever, we must remain true to our longstanding values. As always, we will strive to manage our
business with high standards of integrity. And if we make mistakes, we will recognize them, correct them and
act quickly to ensure they do not happen again. Our values have guided American Express for the past 153
years, and they will continue to do so in the future.
Now let me turn to the business unit results and provide more detail on our performance in 2003.
Business Unit Results
TRAVEL RELATED SERVICES
Travel Related Services (TRS) — which includes our card, travel, merchant and network businesses, as well as
our Travelers Cheques and Prepaid Services group — posted record net income of $2.43 billion, up 14 percent
from a year ago. TRS’ net revenues rose 8 percent to a record $19.2 billion.
These results reflect higher average cardmember spending, the continued benefit of rewards programs and higher
cards-in-force. The higher business volumes were driven by strong growth in retail and everyday spending and by
a notable improvement in the travel and entertainment sector, particularly during the latter part of the year.
American Express is a world leader in providing charge and credit cards to consumers, small businesses and
corporations. In 2003, we added 3.5 million new cards, bringing total worldwide cards-in-force to 60.5 million.
We were among the top card issuers in both spending and lending balance growth, and had industry-leading
credit quality.
Worldwide billed business — or spending on American Express cards — rose 13 percent, with especially strong
growth in consumer and small business spending, both in the United States and internationally. We also began
to see a solid pick-up in spending by corporate cardmembers for the first time in several years. Moreover, the num-
ber of merchants who accept American Express cards continues to grow, and we saw a substantial increase in card-
member transactions at retailers, supermarkets, gas stations, drugstores and other everyday spending locations.
Our lending business also performed very well. The benefit of rewards, along with competitive offers on revolv-
ing credit products, helped drive double-digit growth in lending balances on American Express credit cards.
Based on the excellent progress we made in growing our billed business and lending balances, we believe we
gained share during the year in the credit and charge card market in the United States.
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