[April 22, 2014] |
|
TSYS Reports First Quarter 2014 Total Revenues Increased 32.1%
COLUMBUS, Ga. --(Business Wire)--
TSYS (NYSE: TSS) today reported results for the first quarter of 2014
and announced the sale of its business interests in Japan. The
accompanying financial statements have been adjusted to exclude the
Japanese results from ongoing operations in 2014 and 2013 with those
results reported as "discontinued operations" for all periods presented.
Total revenues for the quarter were $592.8 million, an increase of
32.1%. Revenues before reimbursable items were $532.8 million, an
increase of 37.3%. The reported results for the quarter for both total
revenues and revenues before reimbursable items exclude $16.2 million of
revenue for Japan as a result of moving these results to discontinued
operations. Adjusted EBITDA was $149.6 million, an increase of 21.2%.
Income from continuing operations was $50.6 million. Adjusted cash
earnings per share (EPS) from continuing operations was $0.38. On a GAAP
basis, basic EPS from continuing operations was $0.26. Diluted EPS from
continuing operations was $0.26.
"We are pleased with the first quarter as the financial results met or
exceeded our plans. Our cash flow from operations was $148.7 million and
our free cash flow was $101.5 million, which were increases of $96.3
million and $104.4 million, respectively, over last year. During the
quarter, we also deployed $37.5 million of our capital to increase our
stake in our Central Payment joint venture from 60% to 75% as it
continues to outperform our expected goals," said Philip W. Tomlinson,
chairman and chief executive officer of TSYS.
"Our revised guidance for 2014 is included in the table below and is
only adjusted for the discontinued Japan operations. TSYS' previous
revenue guidance included approximately $70 million of revenue
associated with its operations in Japan for 2014, and $68 million in
2013. The financial impact from the sale of our businesses in Japan had
no material impact on our previous guidance. Revenue and earnings growth
ranges remain strong year over year, while adjusted cash EPS remained
the same. Our revised guidance for 2014 reflects our focus on
diversification, growth and the exceptional performance of our TSYS
team," said Tomlinson.
TSYS' new guidance is as follows:
|
2014 Revised Guidance
|
|
Range
|
|
|
|
|
|
|
(in millions, except per share amounts)
|
|
|
|
|
Percent
Change
|
Total revenues
|
$2,422
|
to
|
$2,471
|
|
|
|
|
17%
|
|
|
to
|
|
|
20%
|
Revenues before reimbursable items
|
$2,182
|
to
|
$2,226
|
|
|
|
|
20%
|
|
|
to
|
|
|
22%
|
Adjusted EBITDA
|
$732
|
to
|
$746
|
|
|
|
|
17%
|
|
|
to
|
|
|
20%
|
Adjusted cash EPS attributable to TSYS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
$1.90
|
to
|
$1.93
|
|
|
|
|
10%
|
|
|
to
|
|
|
12%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Average Basic Weighted Shares
|
188.4
|
|
|
|
|
|
|
|
|
|
|
|
|
Conference Call
TSYS will host its quarterly conference call at 5:00 p.m. ET on Tuesday,
April 22. The conference call can be accessed via simultaneous Internet
broadcast at tsys.com by clicking on the link under "Webcasts" on
the main homepage. The replay will be archived for 12 months and will be
available approximately 30 minutes after the completion of the call. A
slide presentation to accompany the call will be available by clicking
on the link under "Webcasts" on the main homepage of tsys.com.
Non-GAAP Measures
This press release contains information prepared in conformity with GAAP
as well as non-GAAP information. It is management's intent to provide
non-GAAP financial information to enhance understanding of its
consolidated financial information as prepared in accordance with GAAP.
This non-GAAP information should be considered by the reader in addition
to, but not instead of, the financial statements prepared in accordance
with GAAP. Each non-GAAP financial measure and the corresponding GAAP
financial measure are presented so as not to imply that more emphasis
should be placed on the non-GAAP measure. The non-GAAP financial
information presented may be determined or calculated differently by
other companies.
Additional information about non-GAAP financial measures and a
reconciliation of those measures to the most directly comparable GAAP
measures are included on pages 12 to 14 of this release.
About TSYS
At TSYS® (NYSE: TSS), we believe payments should revolve
around people, not the other way around. We call this belief
"People-Centered Payments®." By putting people at the
center of every decision we make, TSYS supports financial institutions,
businesses and governments in more than 80 countries. Through NetSpend®,
A TSYS Company, we empower consumers with the convenience, security, and
freedom to be self-banked. TSYS offers issuer services and merchant
payment acceptance for credit, debit, prepaid, healthcare and business
solutions.
TSYS' headquarters are located in Columbus, Ga., U.S.A., with local
offices spread across the Americas, EMEA and Asia-Pacific. TSYS is a
member of The Civic 50 and was named one of the 2013 World's Most
Ethical Companies by Ethisphere magazine. TSYS routinely posts all
important information on its website. For more, please visit us at www.tsys.com.
Forward-Looking Statements
This press release contains "forward-looking statements" - that is,
statements related to future, not past, events. Forward-looking
statements often address our expected future business and financial
performance and often contain words such as "expect," "anticipate,"
"intend," "believe," "should," "plan," "potential," "will," "could," and
similar expressions. These forward-looking statements include, among
others, statements regarding TSYS' earnings guidance for 2014 total
revenues, revenues before reimbursable items, adjusted EBITDA, and
adjusted cash EPS, and the assumptions underlying such statements. These
statements are based on the current beliefs and expectations of TSYS'
management, are based on management's assumptions and are subject to
significant risks and uncertainties. Actual results may differ
materially from those contemplated by the forward-looking statements. A
number of important factors could cause actual results or events to
differ materially from those contemplated by our forward-looking
statements in this press release. Many of these factors are beyond TSYS'
ability to control or predict. These factors include, but are not
limited to, TSYS' ability to integrate NetSpend and other acquisitions
and achieve the anticipated growth opportunities and other benefits of
the acquisitions; the effect of current domestic and worldwide economic
conditions; the material breach of security of any of TSYS' systems;
risks associated with foreign operations, including adverse developments
with respect to foreign currency exchange rates; expenses are incurred
associated with the signing of a significant client; the deconversion of
a significant client; changes occur in laws, rules, regulations, credit
card association rules, the prepaid industry or other industry standards
affecting TSYS and our clients that may result in costly new compliance
burdens on TSYS and our clients and lead to a decrease in the volume
and/or number of transactions processed; the costs and effects of
litigation, investigations or similar matters or adverse facts and
developments relating thereto; adverse developments with respect to the
payment card industry in general, including a decline in the use of
cards as a payment mechanism; and growth rates of TSYS' existing clients
are lower than anticipated or attrition rates of existing clients are
higher than anticipated. Additional risks and other factors that could
cause actual results or events to differ materially from those
contemplated in this release can be found in TSYS' filings with the
Securities and Exchange Commission, including our most recent Annual
Report on Form 10-K. We believe these forward-looking statements are
reasonable; however, undue reliance should not be placed on any
forward-looking statements, which are based on current expectations. We
do not assume any obligation to update any forward-looking statements as
a result of new information, future developments or otherwise.
|
|
|
|
|
|
|
|
|
|
TSYS
|
Financial Highlights
|
(unaudited)
|
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
|
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
592,848
|
|
|
448,791
|
|
|
32.1
|
|
%
|
|
|
|
|
|
|
|
|
|
|
Cost of services
|
|
|
422,883
|
|
|
304,369
|
|
|
38.9
|
|
|
Selling, general and administrative expenses
|
|
|
87,963
|
|
|
66,421
|
|
|
32.4
|
|
|
Merger and acquisition expenses
|
|
|
1,305
|
|
|
3,481
|
|
|
(62.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
80,697
|
|
|
74,520
|
|
|
8.3
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonoperating income (expenses)
|
|
|
(324
|
)
|
|
1,003
|
|
|
nm
|
|
|
Merger and acquisition expenses - bridge loan facility & other
financing
|
|
|
(9,489
|
)
|
|
(2,743
|
)
|
|
nm
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes, noncontrolling interests
|
|
|
|
|
|
|
|
|
|
and equity in income of equity investments
|
|
|
70,884
|
|
|
72,780
|
|
|
(2.6
|
)
|
|
Income taxes
|
|
|
24,335
|
|
|
17,463
|
|
|
39.4
|
|
|
Income before noncontrolling interests and
|
|
|
|
|
|
|
|
|
|
equity in income of equity investments
|
|
|
46,549
|
|
|
55,317
|
|
|
(15.9
|
)
|
|
Equity in income of equity investments
|
|
|
4,096
|
|
|
3,817
|
|
|
7.3
|
|
|
Income from continuing operations, net of tax
|
|
|
50,645
|
|
|
59,134
|
|
|
(14.4
|
)
|
|
Income from discontinued operations, net of tax
|
|
|
980
|
|
|
15
|
|
|
nm
|
|
|
Net income
|
|
|
51,625
|
|
|
59,149
|
|
|
(12.7
|
)
|
|
Net income attributable to noncontrolling interests
|
|
|
(2,322
|
)
|
|
(2,121
|
)
|
|
(9.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to TSYS common shareholders
|
|
$
|
49,303
|
|
|
57,028
|
|
|
(13.5
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations to TSYS
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
$
|
0.26
|
|
|
0.31
|
|
|
(15.3
|
)
|
%
|
Loss from discontinued operations to TSYS
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
97.9
|
|
|
Basic earnings per share (EPS)
|
|
$
|
0.26
|
|
|
0.31
|
|
|
(14.0
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations to TSYS
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
$
|
0.26
|
|
|
0.31
|
|
|
(15.8
|
)
|
%
|
Loss from discontinued operations to TSYS
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
97.9
|
|
|
Diluted EPS
|
|
$
|
0.26
|
|
|
0.30
|
|
|
(14.6
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per share
|
|
$
|
0.10
|
|
|
0.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to TSYS common shareholders:
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of tax
|
|
$
|
49,321
|
|
|
57,905
|
|
|
(14.8
|
)
|
%
|
Loss from discontinued operations, net of tax
|
|
|
(18
|
)
|
|
(877
|
)
|
|
97.9
|
|
|
Net income
|
|
$
|
49,303
|
|
|
57,028
|
|
|
(13.5
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP measures:
|
|
|
|
|
|
|
|
|
|
Adjusted cash EPS from continuing operations
|
|
$
|
0.38
|
|
|
0.38
|
|
|
(1.1
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
|
149,596
|
|
|
123,446
|
|
|
21.2
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
nm = not meaningful
|
|
|
* EPS amounts may not total due to rounding.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
Consolidated Statements of Comprehensive Income
|
(unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
51,625
|
|
|
59,149
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
Foreign currency translation adjustments
|
|
|
1,581
|
|
|
(12,646
|
)
|
|
Postretirement healthcare plan adjustments
|
|
|
(75
|
)
|
|
155
|
|
|
Unrealized gain on available-for-sale securities
|
|
|
570
|
|
|
-
|
|
Other comprehensive income (loss)
|
|
|
2,076
|
|
|
(12,491
|
)
|
Comprehensive income
|
|
|
53,701
|
|
|
46,658
|
|
Comprehensive income attributable to
|
|
|
|
|
|
noncontrolling interests
|
|
|
2,827
|
|
|
467
|
|
Comprehensive income attributable to
|
|
|
|
|
|
|
TSYS common shareholders
|
|
$
|
50,874
|
|
|
46,191
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
Earnings Per Share
|
(unaudited)
|
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|
|
March 31, 2014
|
|
March 31, 2013
|
|
|
Common
|
|
Participating
|
|
Common
|
|
Participating
|
|
|
Stock
|
|
Securities
|
|
Stock
|
|
Securities
|
|
|
|
|
|
|
|
|
|
Basic earnings per share:
|
|
|
|
|
|
|
|
|
Net income
|
$
|
49,303
|
|
|
|
|
57,028
|
|
|
|
Less income allocated to nonvested awards
|
|
(516
|
)
|
|
516
|
|
(209
|
)
|
|
209
|
Net income allocated to common stock for
|
|
|
|
|
|
|
|
|
EPS calculation ( a )
|
$
|
48,787
|
|
|
516
|
|
56,819
|
|
|
209
|
|
|
|
|
|
|
|
|
|
Average common shares outstanding ( b )
|
|
185,763
|
|
|
1,989
|
|
186,108
|
|
|
699
|
|
|
|
|
|
|
|
|
|
Average common shares and participating securities
|
|
187,752
|
|
|
|
|
186,807
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share ( a )/( b )
|
$
|
0.26
|
|
|
0.26
|
|
0.31
|
|
|
0.30
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
Net income
|
$
|
49,303
|
|
|
|
|
57,028
|
|
|
|
Less income allocated to nonvested awards
|
|
(512
|
)
|
|
512
|
|
(208
|
)
|
|
208
|
Net income allocated to common stock for
|
|
|
|
|
|
|
|
|
EPS calculation ( c )
|
$
|
48,791
|
|
|
512
|
|
56,820
|
|
|
208
|
|
|
|
|
|
|
|
|
|
Average common shares outstanding
|
|
185,763
|
|
|
1,989
|
|
186,108
|
|
|
699
|
Increase due to assumed issuance of shares related
|
|
|
|
|
|
|
|
|
to common equivalent shares outstanding
|
|
2,632
|
|
|
|
|
1,274
|
|
|
|
|
|
|
|
|
|
|
|
|
Average common and common
|
|
|
|
|
|
|
|
|
equivalent shares outstanding ( d )
|
|
188,395
|
|
|
1,989
|
|
187,382
|
|
|
699
|
|
|
|
|
|
|
|
|
|
Average common and common
|
|
|
|
|
|
|
|
|
equivalent shares and participating securities
|
|
190,384
|
|
|
|
|
188,081
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share ( c )/( d )
|
$
|
0.26
|
|
|
0.26
|
|
0.30
|
|
|
0.30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
|
Segment Breakdown
|
|
(unaudited)
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
Change
|
|
|
|
2014
|
|
|
2013
|
|
|
$
|
|
|
%
|
|
|
Revenues before reimbursable items
|
|
|
|
|
|
|
|
|
|
|
North America Services
|
$
|
224,368
|
|
|
205,596
|
|
|
18,772
|
|
|
9.1
|
|
%
|
International Services
|
|
76,773
|
|
|
76,387
|
|
|
386
|
|
|
0.5
|
|
|
Merchant Services
|
|
104,625
|
|
|
109,301
|
|
|
(4,676
|
)
|
|
(4.3
|
)
|
|
NetSpend
|
|
132,640
|
|
|
-
|
|
|
132,640
|
|
|
na
|
|
|
Intersegment revenues
|
|
(5,656
|
)
|
|
(3,252
|
)
|
|
(2,404
|
)
|
|
(73.9
|
)
|
|
Revenues before reimbursable items
|
|
|
|
|
|
|
|
|
|
|
from external customers
|
$
|
532,750
|
|
|
388,032
|
|
|
144,718
|
|
|
37.3
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
|
|
|
|
|
|
|
|
|
North America Services
|
$
|
262,178
|
|
|
239,789
|
|
|
22,389
|
|
|
9.3
|
|
%
|
International Services
|
|
82,378
|
|
|
80,891
|
|
|
1,487
|
|
|
1.8
|
|
|
Merchant Services
|
|
122,690
|
|
|
132,901
|
|
|
(10,211
|
)
|
|
(7.7
|
)
|
|
NetSpend
|
|
132,640
|
|
|
-
|
|
|
132,640
|
|
|
na
|
|
|
Intersegment revenues
|
|
(7,038
|
)
|
|
(4,790
|
)
|
|
(2,248
|
)
|
|
(46.9
|
)
|
|
Revenues from external customers
|
$
|
592,848
|
|
|
448,791
|
|
|
144,057
|
|
|
32.1
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
|
|
|
|
|
|
North America Services
|
$
|
20,276
|
|
|
18,083
|
|
|
2,193
|
|
|
12.1
|
|
%
|
International Services
|
|
9,805
|
|
|
10,699
|
|
|
(894
|
)
|
|
(8.4
|
)
|
|
Merchant Services
|
|
3,400
|
|
|
3,142
|
|
|
258
|
|
|
8.2
|
|
|
NetSpend
|
|
1,735
|
|
|
-
|
|
|
1,735
|
|
|
na
|
|
|
Segment depreciation and amortization
|
|
35,216
|
|
|
31,924
|
|
|
3,292
|
|
|
10.3
|
|
|
Acquisition intangible amortization
|
|
24,313
|
|
|
8,532
|
|
|
15,781
|
|
|
nm
|
|
|
Corporate admin and other
|
|
506
|
|
|
396
|
|
|
110
|
|
|
27.8
|
|
|
Total depreciation and amortization
|
$
|
60,035
|
|
|
40,852
|
|
|
19,183
|
|
|
47.0
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment operating income
|
|
|
|
|
|
|
|
|
|
|
North America Services
|
$
|
74,578
|
|
|
68,748
|
|
|
5,830
|
|
|
8.5
|
|
%
|
International Services
|
|
4,555
|
|
|
6,861
|
|
|
(2,306
|
)
|
|
(33.6
|
)
|
|
Merchant Services
|
|
30,168
|
|
|
37,636
|
|
|
(7,468
|
)
|
|
(19.8
|
)
|
|
NetSpend
|
|
28,717
|
|
|
-
|
|
|
28,717
|
|
|
na
|
|
|
Total adjusted segment operating income
|
|
138,018
|
|
|
113,245
|
|
|
24,773
|
|
|
21.9
|
|
|
Acquisition intangible amortization
|
|
(24,313
|
)
|
|
(8,532
|
)
|
|
(15,781
|
)
|
|
nm
|
|
|
NetSpend M&A operating expenses (non-recurring)
|
(1,253
|
)
|
|
(3,481
|
)
|
|
2,228
|
|
|
64.0
|
|
|
Share-based compensation
|
|
(7,611
|
)
|
|
(4,593
|
)
|
|
(3,018
|
)
|
|
(65.7
|
)
|
|
Corporate admin and other
|
|
(24,144
|
)
|
|
(22,119
|
)
|
|
(2,025
|
)
|
|
(9.2
|
)
|
|
Operating income
|
$
|
80,697
|
|
|
74,520
|
|
|
6,177
|
|
|
8.3
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
Reimbursable items:
|
|
|
|
|
|
|
|
|
|
|
North America Services
|
$
|
37,810
|
|
|
34,193
|
|
|
3,617
|
|
|
10.6
|
|
%
|
International Services
|
|
5,605
|
|
|
4,504
|
|
|
1,101
|
|
|
24.4
|
|
|
Merchant Services
|
|
18,065
|
|
|
23,600
|
|
|
(5,535
|
)
|
|
(23.5
|
)
|
|
NetSpend
|
|
-
|
|
|
-
|
|
|
-
|
|
|
na
|
|
|
Intersegment revenues
|
|
(1,382
|
)
|
|
(1,538
|
)
|
|
156
|
|
|
10.1
|
|
|
Reimbursable items
|
$
|
60,098
|
|
|
60,759
|
|
|
(661
|
)
|
|
(1.1
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
Segment Breakdown
|
(unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Volumes:
|
|
|
At
|
Change
|
|
FTEs (full-time equivalents)
|
|
|
|
3/31/2014
|
|
|
12/31/2013
|
|
|
$
|
|
%
|
|
|
North America Services
|
|
|
|
4,587
|
|
|
4,484
|
|
|
103
|
|
2.3
|
|
%
|
International Services
|
|
|
|
2,414
|
|
|
2,413
|
|
|
1
|
|
0.0
|
|
|
Merchant Services
|
|
|
|
1,595
|
|
|
1,599
|
|
|
(4
|
)
|
(0.3
|
)
|
|
NetSpend
|
|
|
|
508
|
|
|
470
|
|
|
38
|
|
8.1
|
|
|
Corporate Admin and Other
|
|
|
|
573
|
|
|
545
|
|
|
28
|
|
5.1
|
|
|
FTEs - Continuing Operations
|
|
|
|
9,677
|
|
|
9,511
|
|
|
166
|
|
1.7
|
|
%
|
Discontinued Operations
|
|
|
|
80
|
|
|
84
|
|
|
(4
|
)
|
(4.8
|
)
|
|
FTEs
|
|
|
|
9,757
|
|
|
9,595
|
|
|
162
|
|
1.7
|
|
%
|
|
|
|
|
|
|
|
|
Total assets (in thousands)
|
|
|
|
|
|
|
|
North America Services
|
|
$
|
|
3,247,258
|
|
|
3,215,333
|
|
|
31,925
|
|
1.0
|
|
%
|
International Services
|
|
|
|
410,902
|
|
|
417,379
|
|
|
(6,477
|
)
|
(1.6
|
)
|
|
Merchant Services
|
|
|
|
693,130
|
|
|
676,592
|
|
|
16,538
|
|
2.4
|
|
|
NetSpend
|
|
|
|
1,586,326
|
|
|
1,596,150
|
|
|
(9,824
|
)
|
(0.6
|
)
|
|
Intersegment assets
|
|
|
|
(2,219,689
|
)
|
|
(2,218,886
|
)
|
|
(803
|
)
|
(0.0
|
)
|
|
Total assets
|
|
$
|
|
3,717,927
|
|
|
3,686,568
|
|
|
31,359
|
|
0.9
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
Change
|
|
|
|
|
|
2014
|
|
|
2013
|
|
Inc(Dec)
|
%
|
|
|
North America Segment:
|
|
|
|
|
|
|
|
Accounts on File (AOF) (in millions)
|
|
|
|
495.5
|
|
|
422.8
|
|
|
72.7
|
|
17.2
|
|
%
|
Transactions (in millions)
|
|
|
|
2,327.6
|
|
|
2,013.4
|
|
|
314.2
|
|
15.6
|
|
%
|
|
|
|
|
|
|
|
|
International Segment:
|
|
|
|
|
|
|
|
AOF (in millions)
|
|
|
|
60.7
|
|
|
55.7
|
|
|
5.0
|
|
9.0
|
|
%
|
Transactions (in millions)
|
|
|
|
517.9
|
|
|
434.0
|
|
|
83.9
|
|
19.3
|
|
%
|
|
|
|
|
|
|
|
|
Merchant Segment:
|
|
|
|
|
|
|
|
Point-of-sale Transactions (in millions)
|
|
|
|
982.2
|
|
|
1,099.1
|
|
|
(116.9
|
)
|
(10.6
|
)
|
%
|
Dollar sales volume (in millions)
|
|
|
$
|
10,779.7
|
|
$
|
10,132.3
|
|
$
|
647.4
|
|
6.4
|
|
%
|
|
|
|
|
|
|
|
|
NetSpend Segment:
|
|
|
|
|
|
|
|
Gross Dollar Volume (in millions)
|
|
|
$
|
6,567.2
|
|
$
|
5,378.7
|
|
$
|
1,188.5
|
|
22.1
|
|
%
|
|
|
|
|
|
|
|
|
90-Day Active Cards (in thousands)
|
|
|
|
3,654.8
|
|
|
3,157.5
|
|
|
497.3
|
|
15.7
|
|
|
Direct Deposit 90-Day Active Cards (in thousands)
|
|
|
2,070.3
|
|
|
1,707.9
|
|
|
362.4
|
|
21.2
|
|
|
% of 90-Day Active Cards with Direct Deposit
|
|
|
|
56.6
|
%
|
|
54.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
Balance Sheet
|
(unaudited)
|
(in thousands)
|
|
|
Mar 31, 2014
|
|
Dec 31, 2013
|
Assets
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
$
|
274,161
|
|
|
247,700
|
|
Accounts receivable, net
|
|
267,787
|
|
|
255,773
|
|
Deferred income tax assets
|
|
12,477
|
|
|
14,158
|
|
Prepaid expenses and other current assets
|
|
89,810
|
|
|
95,109
|
|
Current assets of discontinued operations
|
|
43,614
|
|
|
41,193
|
|
|
|
|
|
|
Total current assets
|
|
687,849
|
|
|
653,933
|
|
Goodwill
|
|
1,539,758
|
|
|
1,541,574
|
|
Other intangible assets, net
|
|
462,027
|
|
|
481,419
|
|
Computer software, net
|
|
359,696
|
|
|
363,880
|
|
Property and equipment, net
|
|
261,097
|
|
|
259,968
|
|
Contract acquisition costs, net
|
|
195,706
|
|
|
184,828
|
|
Equity investments, net
|
|
96,533
|
|
|
94,133
|
|
Deferred income tax assets, net
|
|
3,903
|
|
|
3,972
|
|
Other assets
|
|
97,410
|
|
|
87,146
|
|
Long-Term assets of discontinued operations
|
|
13,948
|
|
|
15,715
|
|
|
|
|
|
|
Total assets
|
$
|
3,717,927
|
|
|
3,686,568
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable
|
$
|
49,722
|
|
|
33,651
|
|
Current portion of borrowings
|
|
34,320
|
|
|
34,257
|
|
Current portion of obligations under capital leases
|
|
10,625
|
|
|
22,662
|
|
Accrued salaries and employee benefits
|
|
28,188
|
|
|
38,339
|
|
Other current liabilities
|
|
195,708
|
|
|
159,170
|
|
Current liabilities of discontinued operations
|
|
6,675
|
|
|
9,136
|
|
|
|
|
|
|
Total current liabilities
|
|
325,238
|
|
|
297,215
|
|
Long-term borrowings, excluding current portion
|
|
1,419,742
|
|
|
1,428,251
|
|
Deferred income tax liabilities
|
|
229,649
|
|
|
228,727
|
|
Obligations under capital leases, excluding current portion
|
6,096
|
|
|
7,500
|
|
Other long-term liabilities
|
|
83,195
|
|
|
81,600
|
|
Long-term liabilities of discontinued operations
|
|
1,244
|
|
|
1,197
|
|
|
|
|
|
|
Total liabilities
|
|
2,065,164
|
|
|
2,044,490
|
|
Redeemable noncontrolling interest
|
|
23,918
|
|
|
39,652
|
|
Equity
|
|
|
|
|
Shareholders' equity:
|
|
|
|
|
Common stock
|
|
20,279
|
|
|
20,279
|
|
Additional paid-in capital
|
|
145,429
|
|
|
165,841
|
|
Accumulated other comprehensive income, net
|
|
5,320
|
|
|
3,749
|
|
Treasury stock
|
|
(312,843
|
)
|
|
(326,996
|
)
|
Retained earnings
|
|
1,748,141
|
|
|
1,718,204
|
|
Total shareholders' equity
|
|
1,606,326
|
|
|
1,581,077
|
|
Noncontrolling interests in consolidated subsidiaries
|
|
22,519
|
|
|
21,349
|
|
Total equity
|
|
1,628,845
|
|
|
1,602,426
|
|
Total liabilities and equity
|
$
|
3,717,927
|
|
|
3,686,568
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
Cash Flow
|
(unaudited)
|
(in thousands)
|
|
|
Three Months Ended March 31,
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
Net income
|
$
|
51,625
|
|
|
59,149
|
|
Adjustments to reconcile net income to net cash
|
|
|
|
|
provided by operating activities:
|
|
|
|
|
Equity in income of equity investments
|
|
(4,096
|
)
|
|
(3,817
|
)
|
Net gain on foreign currency
|
|
(425
|
)
|
|
(45
|
)
|
Depreciation and amortization
|
|
61,432
|
|
|
42,498
|
|
Amortization of debt issuance costs
|
|
452
|
|
|
2,860
|
|
Amortization of bond discount
|
|
94
|
|
|
-
|
|
Changes in fair value of private equity investments
|
|
(312
|
)
|
|
(1,227
|
)
|
Share-based compensation
|
|
7,611
|
|
|
4,593
|
|
Excess tax benefit from share-based compensation
|
|
(4,037
|
)
|
|
(536
|
)
|
Provisions for bad debt expense and billing
|
|
|
|
|
adjustments
|
|
749
|
|
|
376
|
|
Charges for transaction processing provisions
|
|
1,826
|
|
|
4,160
|
|
Provision for fraud and other losses
|
|
9,639
|
|
|
-
|
|
Deferred income tax expense
|
|
4,751
|
|
|
9,442
|
|
Loss on disposal of equipment, net
|
|
2
|
|
|
55
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
Accounts receivable
|
|
(11,418
|
)
|
|
(30,182
|
)
|
Prepaid expenses, other current assets and other long-term assets
|
|
(3,170
|
)
|
|
(32,247
|
)
|
Accounts payable
|
|
15,738
|
|
|
5,745
|
|
Accrued salaries and employee benefits
|
|
(9,986
|
)
|
|
(9,266
|
)
|
Other current liabilities and other long-term liabilities
|
|
28,231
|
|
|
879
|
|
Net cash provided by operating activities
|
|
148,706
|
|
|
52,437
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
Purchases of property and equipment, net
|
|
(13,641
|
)
|
|
(6,481
|
)
|
Additions to licensed computer software from vendors
|
|
(5,963
|
)
|
|
(29,904
|
)
|
Additions to internally developed computer software
|
|
(9,735
|
)
|
|
(5,297
|
)
|
Purchase of private equity investments
|
|
(822
|
)
|
|
(411
|
)
|
Additions to contract acquisition costs
|
|
(17,903
|
)
|
|
(13,666
|
)
|
Net cash used in investing activities
|
|
(48,064
|
)
|
|
(55,759
|
)
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
Principal payments on long-term borrowings and
|
|
|
|
|
capital lease obligations
|
|
(22,277
|
)
|
|
(9,784
|
)
|
Proceeds from exercise of stock options
|
|
9,539
|
|
|
2,551
|
|
Excess tax benefit from share-based compensation
|
|
4,037
|
|
|
536
|
|
Repurchase of common stock under plans and tax withholding
|
|
(5,173
|
)
|
|
(5,501
|
)
|
Debt issuance costs
|
|
-
|
|
|
(3,534
|
)
|
Purchase of noncontrolling interests
|
|
(37,500
|
)
|
|
-
|
|
Subsidiary dividends paid to noncontrolling shareholders
|
|
(2,312
|
)
|
|
(953
|
)
|
Dividends paid on common stock
|
|
(18,788
|
)
|
|
-
|
|
Net cash used in financing activities
|
|
(72,474
|
)
|
|
(16,685
|
)
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS:
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
1,015
|
|
|
(4,508
|
)
|
Net increase in cash and cash equivalents
|
|
29,183
|
|
|
(24,515
|
)
|
Cash and cash equivalents at beginning of period
|
|
278,230
|
|
|
247,612
|
|
Cash and cash equivalents at end of period
|
|
307,413
|
|
|
223,097
|
|
Less cash and cash equivalents of
|
|
|
|
|
discontinued operations at end of period
|
|
33,252
|
|
|
22,324
|
|
Cash and cash equivalents of continuing operations at end of period
|
$
|
274,161
|
|
|
200,773
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts on File
|
|
|
|
|
|
|
|
Total
|
(in millions)
|
|
|
|
|
|
|
|
|
March 2014
|
|
|
March 2013
|
|
% Change
|
Consumer Credit
|
|
|
|
|
|
|
|
|
234.8
|
|
|
|
203.7
|
|
|
15.3
|
Retail
|
|
|
|
|
|
|
|
|
27.5
|
|
|
|
25.2
|
|
|
9.3
|
Total Consumer
|
|
|
|
|
|
|
|
|
262.3
|
|
|
|
228.9
|
|
|
14.6
|
Commercial
|
|
|
|
|
|
|
|
|
40.4
|
|
|
|
37.9
|
|
|
6.7
|
Other
|
|
|
|
|
|
|
|
|
19.7
|
|
|
|
13.4
|
|
|
46.5
|
Subtotal
|
|
|
|
|
|
|
|
|
322.4
|
|
|
|
280.2
|
|
|
15.1
|
Prepaid/Stored Value
|
|
|
|
|
|
|
|
|
120.0
|
|
|
|
107.3
|
|
|
11.8
|
Government Services
|
|
|
|
|
|
|
|
|
63.0
|
|
|
|
59.4
|
|
|
6.1
|
Commercial Card Single Use
|
|
|
|
|
|
|
|
|
50.8
|
|
|
|
31.6
|
|
|
60.8
|
Total AOF
|
|
|
|
|
|
|
|
|
556.2
|
|
|
|
478.5
|
|
|
16.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth in Accounts on File (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 2013 to
March 2014
|
|
March 2012 to
March 2013
|
Beginning balance
|
|
|
|
|
478.5
|
|
|
|
|
|
|
|
|
415.5
|
|
|
|
Change in accounts on file due to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Internal growth of existing clients
|
|
|
|
38.6
|
|
|
|
|
|
|
|
|
32.2
|
|
|
|
|
New clients
|
|
|
|
64.6
|
|
|
|
|
|
|
|
|
77.1
|
|
|
|
|
Purges/Sales
|
|
|
|
(24.7
|
)
|
|
|
|
|
|
|
|
(44.6
|
)
|
|
|
|
Deconversions
|
|
|
|
(0.8
|
)
|
|
|
|
|
|
|
|
(1.7
|
)
|
|
|
Ending balance
|
|
|
|
|
556.2
|
|
|
|
|
|
|
|
|
478.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP Financial Measures
|
|
|
|
Non-GAAP Measures
|
|
|
|
The schedule below provides a reconciliation of revenues and
operating results on a constant currency basis to reported revenues
and operating income. This non-GAAP measure presents first quarter
2014 financial results using the previous year's foreign currency
exchange rates. On a full year constant currency basis, TSYS' total
revenues grew 31.1% as compared to a reported GAAP increase of 32.1%.
|
|
|
|
The schedule below also provides a reconciliation of basic EPS,
adjusted for the after-tax impact of acquisition intangible
amortization, share-based compensation and merger and acquisition
costs, to adjusted cash EPS.
|
|
|
|
The tax rate used in the calculation of cash EPS for the quarter
and year is equal to an estimate of our annual effective tax rate
on GAAP income. This effective rate is estimated annually and may
be adjusted during the year to take into account events or trends
that materially impact the effective tax rate including, but not
limited to, significant changes resulting from tax legislation,
material changes in the mix of revenues and expenses by entity and
other significant events.
|
|
|
|
The schedule also provides a reconciliation of net income, adjusted
for equity in income of equity investments, income taxes,
nonoperating expense, depreciation and amortization, share-based
compensation, and merger and acquisition expenses, to adjusted
EBITDA.
|
|
|
|
TSYS believes that non-GAAP financial measures are important to
enable investors to understand and evaluate its ongoing operating
results. Accordingly, TSYS includes non-GAAP financial measures when
reporting its financial results to shareholders and investors in
order to provide them with an additional tool to evaluate TSYS'
ongoing business operations. TSYS believes that the non-GAAP
financial measures are representative of comparative financial
performance that reflects the economic substance of TSYS' current
and ongoing business operations.
|
|
|
|
Although non-GAAP financial measures are often used to measure TSYS'
operating results and assess its financial performance, they are not
necessarily comparable to similarly titled captions of other
companies due to potential inconsistencies in the method of
calculation.
|
|
|
|
TSYS believes that its use of non-GAAP financial measures provides
investors with the same key financial performance indicators that
are utilized by management to assess TSYS' operating results,
evaluate the business and make operational decisions on a
prospective, going-forward basis. Hence, management provides
disclosure of non-GAAP financial measures to give shareholders and
potential investors an opportunity to see TSYS as viewed by
management, to assess TSYS with some of the same tools that
management utilizes internally and to be able to compare such
information with prior periods. TSYS believes that the presentation
of GAAP financial measures alone would not provide its shareholders
and potential investors with the ability to appropriately analyze
its ongoing operational results, and therefore expected future
results. TSYS therefore believes that inclusion of non-GAAP
financial measures provides investors with additional information to
help them better understand its financial statements just as
management utilizes these non-GAAP financial measures to better
understand the business, manage budgets and allocate resources.
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
Constant Currency Comparison
|
(unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
|
|
|
2014
|
|
2013
|
|
Change
|
|
Consolidated
|
|
|
|
|
|
|
|
|
Constant currency (1)
|
$
|
588,485
|
|
448,791
|
|
31.1
|
%
|
Foreign currency (2)
|
|
|
4,363
|
|
-
|
|
|
|
Total revenues
|
|
$
|
592,848
|
|
448,791
|
|
32.1
|
%
|
|
|
|
|
|
|
|
|
|
|
Constant currency (1)
|
$
|
528,701
|
|
388,032
|
|
36.3
|
%
|
Foreign currency (2)
|
|
|
4,049
|
|
-
|
|
|
|
Total revenues before reimbursable items
|
$
|
532,750
|
|
388,032
|
|
37.3
|
%
|
|
|
|
|
|
|
|
|
|
|
Constant currency (1)
|
$
|
78,152
|
|
74,520
|
|
4.9
|
%
|
Foreign currency (2)
|
|
|
2,545
|
|
-
|
|
|
|
Operating income
|
|
$
|
80,697
|
|
74,520
|
|
8.3
|
%
|
|
|
|
|
|
|
|
|
|
|
International Services
|
|
|
|
|
|
|
|
|
Constant currency (1)
|
$
|
78,134
|
|
80,891
|
|
(3.4)
|
%
|
Foreign currency (2)
|
|
|
4,244
|
|
-
|
|
|
|
Total revenues
|
|
$
|
82,378
|
|
80,891
|
|
1.8
|
%
|
|
|
|
|
|
|
|
|
|
|
(1) Reflects current period results on a non-GAAP basis as if
foreign currency rates did not change from the comparable prior year
period.
|
(2) Reflects the impact of calculated changes in foreign currency
rates from the comparable period.
|
|
|
|
|
|
|
|
|
|
|
Revenues Before Reimbursable Items
|
(unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
|
|
|
2014
|
|
2013
|
|
Change
|
|
Total revenues
|
|
$
|
592,848
|
|
448,791
|
|
32.1
|
%
|
Reimbursable items
|
|
|
60,098
|
|
60,759
|
|
(1.1)
|
|
Revenues before reimbursable items
|
$
|
532,750
|
|
388,032
|
|
37.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
|
|
|
|
Adjusted Cash Earnings
|
|
(unaudited)
|
|
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
Percent
|
|
|
Income from continuing operations attributable to
|
|
2014
|
|
2013
|
|
Change
|
|
|
TSYS common shareholders
|
$
|
49,321
|
|
57,905
|
|
(14.8
|
)
|
%
|
Adjust for amounts attributable to TSYS common shareholders:
|
|
|
|
|
|
|
Add: Acquisition intangible amortization, net of taxes
|
|
15,813
|
|
5,492
|
|
nm
|
|
%
|
Add: Share-based compensation, net of taxes
|
|
5,017
|
|
3,148
|
|
59.4
|
|
%
|
Cash earnings
|
|
|
70,151
|
|
66,545
|
|
5.4
|
|
%
|
Add: NetSpend M&A expenses, net of taxes* (non-recurring)
|
|
1,204
|
|
5,222
|
|
(76.9
|
)
|
%
|
Cash earnings adjusted
|
$
|
71,355
|
|
71,767
|
|
(0.6
|
)
|
%
|
|
|
|
|
|
|
|
|
|
Basic EPS - Income from continuing operations attributable to
|
|
|
|
|
|
|
TSYS common shareholders
|
|
|
|
|
|
|
As reported (GAAP)
|
|
$
|
0.26
|
|
0.31
|
|
(15.3
|
)
|
%
|
|
|
|
|
|
|
|
|
|
Adjust for amounts attributable to TSYS common shareholders:
|
|
|
|
|
|
|
Add: Acquisition intangible amortization, net of taxes
|
|
0.08
|
|
0.03
|
|
nm
|
|
%
|
Add: Share-based compensation, net of taxes
|
|
0.03
|
|
0.02
|
|
58.0
|
|
%
|
Cash earnings per share
|
|
0.37
|
|
0.36
|
|
4.9
|
|
%
|
Add: NetSpend M&A expenses, net of taxes* (non-recurring)
|
|
0.01
|
|
0.03
|
|
(77.1
|
)
|
%
|
Adjusted cash EPS **
|
$
|
0.38
|
|
0.38
|
|
(1.1
|
)
|
%
|
|
|
|
|
|
|
|
|
|
Average common shares and participating securities
|
|
187,752
|
|
186,807
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Certain merger and acquisition costs are nondeductible for income
tax purposes
|
|
** Adjusted cash EPS amounts may not total due to rounding.
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
(unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
Percent
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Change
|
|
|
Net income
|
|
$
|
51,625
|
|
59,149
|
|
(12.7
|
)
|
%
|
Adjust for:
|
|
|
|
|
|
|
|
Deduct: Income from discontinued operations
|
|
(980
|
)
|
(15
|
)
|
nm
|
|
%
|
Deduct: Equity in income of equity investments
|
|
(4,096
|
)
|
(3,817
|
)
|
(7.3
|
)
|
%
|
Add: Income taxes
|
|
24,335
|
|
17,463
|
|
39.4
|
|
%
|
Add: Nonoperating expense
|
|
9,813
|
|
1,740
|
|
nm
|
|
%
|
Add: Depreciation and amortization
|
|
60,035
|
|
40,852
|
|
47.0
|
|
%
|
EBITDA
|
|
|
|
140,732
|
|
115,372
|
|
22.0
|
|
%
|
Adjust for:
|
|
|
|
|
|
|
|
Add: Share-based compensation
|
|
7,611
|
|
4,593
|
|
65.7
|
|
%
|
Add: NetSpend M&A operating expenses *(non-recurring)
|
|
1,253
|
|
3,481
|
|
(64.0
|
)
|
%
|
Adjusted EBITDA
|
|
$
|
149,596
|
|
123,446
|
|
21.2
|
|
%
|
|
|
|
|
|
|
|
|
|
nm = not meaningful
|
* Excludes share-based compensation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
Financial Highlights
|
(unaudited)
|
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
|
|
|
|
|
|
|
|
|
|
|
|
Months
|
|
|
|
Three Months Ended
|
|
Ended
|
|
|
|
March 31,
|
|
June 30,
|
|
Sept 30,
|
|
Dec 31,
|
|
Dec 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
448,791
|
|
|
461,860
|
|
|
570,551
|
|
|
583,103
|
|
|
2,064,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of services
|
|
|
304,369
|
|
|
301,627
|
|
|
377,147
|
|
|
386,295
|
|
|
1,369,438
|
|
Selling, general and administrative expenses
|
|
|
66,421
|
|
|
64,345
|
|
|
81,643
|
|
|
85,739
|
|
|
298,147
|
|
Merger and acquisition expenses
|
|
|
3,481
|
|
|
1,246
|
|
|
7,282
|
|
|
2,211
|
|
|
14,220
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
74,520
|
|
|
94,642
|
|
|
104,479
|
|
|
108,858
|
|
|
382,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonoperating income (expenses)
|
|
|
1,003
|
|
|
(590
|
)
|
|
(499
|
)
|
|
(718
|
)
|
|
(804
|
)
|
Merger and acquisition expenses - bridge loan facility & other
financing
|
|
(2,743
|
)
|
|
(6,934
|
)
|
|
(9,789
|
)
|
|
(9,754
|
)
|
|
(29,220
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes, noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
and equity in income of equity investments
|
|
|
72,780
|
|
|
87,118
|
|
|
94,191
|
|
|
98,386
|
|
|
352,476
|
|
Income taxes
|
|
|
17,463
|
|
|
29,984
|
|
|
30,100
|
|
|
33,435
|
|
|
110,982
|
|
Income before noncontrolling interests and
|
|
|
|
|
|
|
|
|
|
|
|
equity in income of equity investments
|
|
|
55,317
|
|
|
57,134
|
|
|
64,091
|
|
|
64,951
|
|
|
241,494
|
|
Equity in income of equity investments
|
|
|
3,817
|
|
|
2,748
|
|
|
2,792
|
|
|
3,691
|
|
|
13,048
|
|
Income from continuing operations, net of tax
|
|
|
59,134
|
|
|
59,882
|
|
|
66,883
|
|
|
68,642
|
|
|
254,542
|
|
income from discontinued operations, net of tax
|
|
|
15
|
|
|
678
|
|
|
611
|
|
|
751
|
|
|
2,055
|
|
Net income
|
|
|
59,149
|
|
|
60,560
|
|
|
67,494
|
|
|
69,393
|
|
|
256,597
|
|
Net income attributable to noncontrolling interests
|
|
|
(2,121
|
)
|
|
(2,844
|
)
|
|
(3,144
|
)
|
|
(3,738
|
)
|
|
(11,847
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to TSYS common shareholders
|
|
$
|
57,028
|
|
|
57,716
|
|
|
64,350
|
|
|
65,655
|
|
|
244,750
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations to TSYS
|
|
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
$
|
0.31
|
|
|
0.31
|
|
|
0.34
|
|
|
0.35
|
|
|
1.31
|
|
Loss from discontinued operations to TSYS
|
|
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.01
|
)
|
Basic earnings per share (EPS)
|
|
$
|
0.31
|
|
|
0.31
|
|
|
0.34
|
|
|
0.35
|
|
|
1.30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations to TSYS
|
|
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
$
|
0.31
|
|
|
0.31
|
|
|
0.34
|
|
|
0.34
|
|
|
1.30
|
|
Loss from discontinued operations to TSYS
|
|
|
|
|
|
|
|
|
|
|
|
common shareholders*
|
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.01
|
)
|
Diluted EPS
|
|
$
|
0.30
|
|
|
0.31
|
|
|
0.34
|
|
|
0.34
|
|
|
1.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per share
|
|
$
|
0.10
|
|
|
0.10
|
|
|
0.10
|
|
|
0.10
|
|
|
0.40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to TSYS common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of tax
|
|
$
|
57,905
|
|
|
58,096
|
|
|
64,834
|
|
|
66,058
|
|
|
246,893
|
|
Loss from discontinued operations, net of tax
|
|
|
(877
|
)
|
|
(380
|
)
|
|
(484
|
)
|
|
(403
|
)
|
|
(2,143
|
)
|
Net income
|
|
$
|
57,028
|
|
|
57,716
|
|
|
64,350
|
|
|
65,655
|
|
|
244,750
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP measures:
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted cash EPS from continuing operations
|
|
$
|
0.38
|
|
|
0.37
|
|
|
0.49
|
|
|
0.48
|
|
|
1.72
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
|
123,446
|
|
|
140,105
|
|
|
179,445
|
|
|
181,097
|
|
|
624,093
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Prior periods restated for discontinued operations.
|
nm = not meaningful
|
* EPS amounts may not total due to rounding.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TSYS
|
Segment Breakdown
|
(unaudited)
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
|
|
|
|
|
|
|
|
Months
|
|
|
Three Months Ended
|
|
Ended
|
|
|
Mar 31,
|
Jun 30,
|
Sep 30,
|
Dec 31,
|
|
Dec 31,
|
|
|
2013
|
|
2013
|
|
2013
|
|
2013
|
|
|
2013
|
|
Revenues before reimbursable items
|
|
|
|
|
|
|
|
North America Services
|
$
|
205,596
|
|
214,526
|
|
217,257
|
|
223,266
|
|
|
860,645
|
|
International Services
|
|
76,387
|
|
76,626
|
|
77,876
|
|
90,595
|
|
|
321,484
|
|
Merchant Services
|
|
109,301
|
|
112,952
|
|
113,650
|
|
110,375
|
|
|
446,278
|
|
NetSpend
|
|
-
|
|
-
|
|
103,706
|
|
104,144
|
|
|
207,850
|
|
Intersegment revenues
|
|
(3,252
|
)
|
(3,175
|
)
|
(3,001
|
)
|
(3,121
|
)
|
|
(12,549
|
)
|
Revenues before reimbursable items
|
|
|
|
|
|
|
|
from external customers
|
$
|
388,032
|
|
400,929
|
|
509,488
|
|
525,259
|
|
|
1,823,708
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
|
|
|
|
|
|
North America Services
|
$
|
239,789
|
|
248,640
|
|
252,577
|
|
259,067
|
|
|
1,000,073
|
|
International Services
|
|
80,891
|
|
81,504
|
|
83,025
|
|
96,129
|
|
|
341,549
|
|
Merchant Services
|
|
132,901
|
|
136,458
|
|
135,616
|
|
128,075
|
|
|
533,050
|
|
NetSpend
|
|
-
|
|
-
|
|
103,706
|
|
104,144
|
|
|
207,850
|
|
Intersegment revenues
|
|
(4,790
|
)
|
(4,742
|
)
|
(4,373
|
)
|
(4,312
|
)
|
|
(18,217
|
)
|
Revenues from external customers
|
$
|
448,791
|
|
461,860
|
|
570,551
|
|
583,103
|
|
|
2,064,305
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
|
|
|
North America Services
|
$
|
18,083
|
|
18,213
|
|
18,764
|
|
19,420
|
|
|
74,480
|
|
International Services
|
|
10,699
|
|
9,450
|
|
9,585
|
|
11,974
|
|
|
41,708
|
|
Merchant Services
|
|
3,142
|
|
2,998
|
|
2,890
|
|
3,004
|
|
|
12,034
|
|
NetSpend
|
|
-
|
|
-
|
|
1,470
|
|
1,651
|
|
|
3,121
|
|
Segment depreciation and amortization
|
|
31,924
|
|
30,661
|
|
32,709
|
|
36,049
|
|
|
131,343
|
|
Acquisition intangible amortization
|
|
8,532
|
|
7,879
|
|
24,731
|
|
24,751
|
|
|
65,893
|
|
Corporate admin and other
|
|
395
|
|
466
|
|
461
|
|
468
|
|
|
1,790
|
|
Total depreciation and amortization
|
$
|
40,851
|
|
39,006
|
|
57,901
|
|
61,268
|
|
|
199,026
|
|
|
|
|
|
|
|
|
|
Adjusted segment operating income
|
|
|
|
|
|
|
|
North America Services
|
$
|
68,748
|
|
81,318
|
|
84,443
|
|
87,110
|
|
|
321,619
|
|
International Services
|
|
6,861
|
|
7,693
|
|
9,528
|
|
17,986
|
|
|
42,068
|
|
Merchant Services
|
|
37,636
|
|
41,302
|
|
40,753
|
|
35,952
|
|
|
155,643
|
|
NetSpend
|
|
-
|
|
-
|
|
34,616
|
|
31,737
|
|
|
66,353
|
|
Total adjusted segment operating income
|
|
113,245
|
|
130,313
|
|
169,340
|
|
172,785
|
|
|
585,683
|
|
Acquisition intangible amortization
|
|
(8,532
|
)
|
(7,879
|
)
|
(24,732
|
)
|
(24,751
|
)
|
|
(65,894
|
)
|
NetSpend M&A operating expenses (non-recurring)
|
(3,481
|
)
|
(1,246
|
)
|
(7,282
|
)
|
(2,211
|
)
|
|
(14,220
|
)
|
Share-based compensation
|
|
(4,593
|
)
|
(5,211
|
)
|
(9,784
|
)
|
(9,345
|
)
|
|
(28,933
|
)
|
Corporate admin and other
|
|
(22,119
|
)
|
(21,334
|
)
|
(23,063
|
)
|
(27,620
|
)
|
|
(94,136
|
)
|
Operating income
|
$
|
74,520
|
|
94,643
|
|
104,479
|
|
108,858
|
|
|
382,500
|
|
|
|
|
|
|
|
|
|
Other:
|
|
|
|
|
|
|
|
Reimbursable items:
|
|
|
|
|
|
|
|
North America Services
|
$
|
34,193
|
|
34,114
|
|
35,320
|
|
35,801
|
|
|
139,428
|
|
International Services
|
|
4,504
|
|
4,878
|
|
5,149
|
|
5,534
|
|
|
20,065
|
|
Merchant Services
|
|
23,600
|
|
23,506
|
|
21,966
|
|
17,700
|
|
|
86,772
|
|
NetSpend
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
Intersegment revenues
|
|
(1,538
|
)
|
(1,567
|
)
|
(1,372
|
)
|
(1,191
|
)
|
|
(5,668
|
)
|
Reimbursable items
|
$
|
60,759
|
|
60,931
|
|
61,063
|
|
57,844
|
|
|
240,597
|
|
|
|
|
|
|
|
|
|
Note: prior periods restated for discontinued operations and the
reclassification of all share-based compensation as corporate
administration costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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