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TSYS Reports Third Quarter Adjusted EPS Grew 40.2%

Oct 27, 2015

Raises 2015 Adjusted EPS and Revenue Guidance

COLUMBUS, Ga., October 27, 2015 — TSYS (NYSE: TSS) today reported results for the third quarter and year to date.

"We are very pleased with our outstanding third quarter results. These exceptional results were driven by the performance of our clients, the businesses we serve, the consumers who buy and use our products and our team members executing to our strategic plan," said M. Troy Woods, chairman, president and chief executive officer of TSYS.

"As a result of this continued strong performance, we are raising our guidance range for revenues before reimbursables to 12-13%, up from the previous range of 10-12%, and our adjusted earnings per share (EPS) guidance range to 24-26%, up from the previous range of 15-17%," said Woods.

Highlights for the third quarter of 2015 include:

  • Adjusted EPS from continuing operations were $0.78, an increase of 40.2%. On a GAAP basis, basic EPS from continuing operations were $0.66, an increase of 46.7%. 
  • Excluding the impact from discrete tax items of approximately $0.13 per share in the quarter, adjusted EPS was $0.65, an increase of 17.2%.
  • Income from continuing operations attributable to TSYS’ shareholders was $120.6 million, an increase of 45.5%.
  • Adjusted EBITDA was $238.9 million, an increase of 20.6%.
  • Total revenues for the quarter were $707.9 million, an increase of 14.8%. Revenues before reimbursable items were $636.4 million, an increase of 15.1%. 
  • Adjusted operating margin was 31.0%. GAAP operating margin was 23.0%.

Highlights for the first nine months of 2015 include:

  • Adjusted EPS from continuing operations were $1.89, an increase of 36.8%. On a GAAP basis, basic EPS from continuing operations were $1.53, an increase of 48.2%. 
  • Excluding the impact from discrete tax items of approximately $0.13 per share year to date, adjusted EPS was $1.76, an increase of 27.5%. 
  • Income from continuing operations attributable to TSYS’ shareholders was $281.2 million, an increase of 46.5%.
  • Adjusted EBITDA was $638.9 million, an increase of 23.2%.
  • Total revenues were $2.1 billion, an increase of 13.8%. Revenues before reimbursable items were $1.9 billion, an increase of 14.2%. 
  • Adjusted operating margin was 27.9%. GAAP operating margin was 20.2%.

"Our year-to-date free cash flow increased 45.8% over 2014 to $324.4 million. With this build-up of cash during the quarter, we plan to continue our strategic goal of returning approximately 75% of available free cash flow to our shareholders in the form of dividends and share repurchases," said Woods.

Range
(in millions, except per share amounts)
Percent Change
Total Revenues$2,728 to $2,74611% to 12%
Revenues before reimbursable items$2,463 to $2,47312% to 13%
Adjusted EPS attributable to TSYS common shareholders from continuing operations*$2.43 to $2.4724% to 26%
*Average Basic Weighted shares 184
*Note: The impact of any future share repurchases is not included.

Conference Call
TSYS will host its quarterly conference call at 5:00 p.m. ET on Tuesday, October 27. 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 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, adjusted EBITDA and adjusted EPS, and a reconciliation of those measures to the most directly comparable GAAP measures are included on pages 9 to 12 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 has been named one of the 2015 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’ plan to continue its strategic goal of returning approximately 75% of available free cash flow to shareholders and regarding TSYS' revised earnings guidance for 2015 total revenues, revenues before reimbursable items and adjusted 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; the effect of current domestic and worldwide economic conditions; 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; 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; 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.

For financial details, click here.

Slide Presentation

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