TSYS Reports Second Quarter Earnings

Jul 25, 2017

Increases 2017 Outlook for Revenue and Earnings per Share, Increases Quarterly Dividend by 30%

Columbus, Ga., July 25, 2017 – TSYS (NYSE: TSS) today reported results for the second quarter of 2017.

“Our second quarter results were outstanding driven by solid revenue growth that converted into very strong operating income and diluted earnings per share (EPS). These results are all organic as this is the first quarter that the TransFirst acquisition is in both quarters reflecting the execution of our strategic goals,” said M. Troy Woods, chairman and chief executive officer of TSYS.

“With our strong cash flow, we reduced our debt another $125 million during the quarter bringing our year to date reduction to $225 million. We are also pleased to announce that we are increasing our quarterly dividend by 30% to $0.13 per share from $0.10 per share and raising our revenue and EPS guidance,” said Woods.

Highlights for the second quarter of 2017 vs. 2016:

  • Total revenues were $1.2 billion, an increase of 6.1%.
  • Net revenue (non-GAAP), which excludes reimbursable items, interchange and assessment expenses, was $844.1 million, an increase of 6.2%.
  • Net income attributable to TSYS common shareholders was $115.0 million, an increase of 65.0%. Diluted EPS were $0.62, an increase of 64.3%.
  • Adjusted earnings (non-GAAP) were $158.2 million, an increase of 16.8%. Adjusted diluted EPS (non-GAAP) were $0.85, an increase of 16.4%.
  • Adjusted EBITDA (non-GAAP) was $307.7 million, an increase of 12.3%.

Dividend Increase
TSYS’ Board of Directors approved a 30% increase in the regular quarterly dividend payable on TSYS common stock from $0.10 per share to $0.13 per share, payable on October 2, 2017 to shareholders of record as of the close of business on September 21, 2017.

2017 Revised Outlook
The 2017 revised guidance is below.

Range
(in millions, except per share amounts)
Percent Change
Revenue:
Total Revenues (GAAP)$4,809 to $4,88915% to 17%
Net Revenue (non-GAAP)$3,315 to $3,3959% to 12%
Earnings per share:
Diluted EPS (GAAP)$2.30 to $2.3833% to 37%
Adjusted diluted EPS attributable to TSYS common shareholders (non-GAAP)$3.22 to $3.3015% to 18%
Weighted average diluted shares outstanding185

Conference Call
TSYS will host its quarterly conference call at 5:00 p.m. ET on Tuesday, July 25. The conference call can be accessed via simultaneous Internet broadcast on the “Investor Relations” section of TSYS’ website at investors.tsys.com where an accompanying slide presentation will also be available. The replay will be archived for 12 months and will be available approximately 30 minutes after the completion of the call.

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 most directly comparable 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, including, but not limited to, net revenue, adjusted earnings, adjusted EBITDA and adjusted diluted EPS, and a reconciliation of those measures to the most directly comparable GAAP measures is included on pages 11 to 14 in the financial schedules of this release.

About TSYS
TSYS® (NYSE: TSS) is a leading global payments provider, offering seamless, secure and innovative solutions across the payments spectrum — from issuer processing and merchant acquiring to prepaid program management. We succeed because we put people, and their needs, at the heart of every decision. It’s an approach we call ‘People-Centered Payments®’.

Our headquarters are located in Columbus, Ga., U.S.A., with approximately 11,500 team members and local offices spread across 13 countries. TSYS generated revenue of $4.2 billion in 2016, while processing more than 25.5 billion transactions. We are a member of The Civic 50 and were named one of the 2017 World's Most Ethical Companies by Ethisphere magazine. TSYS is a member of the S&P 500 and routinely posts all important information on its website. For more, visit 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 2017 total revenues, net revenue, diluted EPS and adjusted diluted 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, the material breach of security of any of TSYS’ systems; TSYS’ ability to integrate acquisitions and achieve the anticipated growth opportunities and other benefits of the acquisitions, particularly the TransFirst acquisition; the effect of current domestic and worldwide economic conditions; risks associated with foreign operations, including adverse developments with respect to foreign currency exchange rates, and in particular with respect to the current environment, adverse developments with respect to foreign currency exchange rates as a result of the United Kingdom’s decision to leave the European Union (Brexit); expenses incurred associated with the signing of a significant client; TSYS does not convert clients’ portfolios as scheduled; the deconversion of a significant client; changes occur in laws, rules, regulations, credit card association rules, prepaid industry rules 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 or limit the types and amounts of fees that can be charged to customers, and in particular the CFPB’s new rule regarding prepaid financial products; 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. TSYS disclaims any obligation to update any forward-looking statements as a result of new information, future developments or otherwise except as required by law.

For financial details, click here.

Slide Presentation

Contacts:
Cyle Mims
TSYS Media Relations
+1.706.644.3110
cylemims@tsys.com

Shawn Roberts
TSYS Investor Relations
+1.706.644.6081
shawnroberts@tsys.com