Exhibit 99.1

| | |
Total System Services, Inc. One TSYS Way P.O. Box 2567 Columbus, GA 31902-2567 | | +1.706.649.2307 +1.706.649.5740 www.tsys.com |
For immediate release:
Contacts:
Shawn Roberts
TSYS Investor Relations
+1.706.644.6081
shawnroberts@tsys.com
TSYS Reports 2013 Adjusted Cash EPS Increased 17.8%
Provides Guidance of 11-13% Growth in 2014 Adjusted Cash EPS
COLUMBUS, Ga., January 28, 2014 — TSYS (NYSE: TSS) today reported results for the fourth quarter and full year results for 2013.
Summary of Fourth Quarter and Full Year Financial Results Compared to 2012
| • | | Total revenues for the quarter were $600.8 million, an increase of 25.4%. For the year, total revenues were $2.1 billion, an increase of 14.0%. Total revenues for the quarter and year were negatively impacted by currency translation of $3.8 million and $20.6 million, respectively, as well as a decrease in reimbursable items of $2.7 million and $11.9 million, respectively. |
| • | | Revenues before reimbursable items for the quarter were $543.0 million, an increase of 29.7%. For the year, revenues before reimbursable items were $1.9 billion, an increase of 16.9%. Revenues before reimbursable items were negatively impacted by currency translation of $3.9 million for the quarter and $20.3 million for the year. |
| • | | Adjusted EBITDA* for the quarter was $184.2 million, an increase of 32.2%. For the year, adjusted EBITDA was $634.2 million, an increase of 16.0%. |
| • | | Adjusted cash earnings per share (EPS)* for the quarter were $0.48, an increase of 26.9%. For the year, adjusted cash EPS was $1.72, an increase of 17.8%. |
| • | | On a GAAP basis, net income attributable to common shareholders for the quarter was $65.7 million, an increase of 7.9%. For the year, net income attributable to common shareholders was $244.8 million, an increase of 0.2%. |
| • | | Basic EPS for the quarter was $0.35, an increase of 6.2%. Diluted EPS was $0.34, an increase of 5.5%. For the year, basic EPS was $1.30, which was the same as last year. Diluted EPS was $1.29, a decrease of 0.2%. |
* | Note: Adjusted EBITDA and adjusted cash EPS are non-GAAP measures which are detailed later in this press release in the section “Reconciliation of GAAP to Non-GAAP Financial Measures.” |

TSYS Reports 2013 Adjusted Cash EPS Increased 17.8%/p. 2
“Our total revenues exceeded $2 billion for the first time in our history, and we met the high end of the range of our adjusted cash EPS guidance of $1.72. This was truly a transformational year for TSYS,” said Philip W. Tomlinson, chairman and chief executive officer of TSYS.
“During the fourth quarter, we reduced our debt by $62.5 million, bringing our total reductions since the NetSpend acquisition to $124.9 million. Also during the quarter, we purchased 3.1 million shares of our stock for $97.6 million. We are pleased to announce our Board of Directors has approved increasing the number of shares that may be repurchased under our current share repurchase plan from up to 20 million shares to up to 28 million shares and extended the expiration date of the plan to April 30, 2015. With the increase, we have approximately 12 million shares available to be repurchased under the plan,” said Tomlinson.
“Our guidance for 2014 is included in the table below and we expect another year of strong growth in revenues and adjusted cash EPS. We expect growth in total revenues of 17% to 19%, revenues before reimbursable items of 19% to 21%, adjusted EBITDA of 17% to 20%, and adjusted cash EPS of 11% to 13%. The results for 2013 and our guidance for 2014 reflect our focus on diversification, growth and the exceptional performance of our TSYS team,” said Tomlinson.
| | | | | | | | | | | | | | | | | | | | | | | | |
| | 2014 Guidance | |
| | Range (in millions, except per share amounts) | | | Percent Change | |
Total revenues | | $ | 2,491 | | | | to | | | $ | 2,542 | | | | 17 | % | | | to | | | | 19 | % |
Revenues before reimbursable items | | $ | 2,252 | | | | to | | | $ | 2,297 | | | | 19 | % | | | to | | | | 21 | % |
Adjusted EBITDA | | $ | 744 | | | | to | | | $ | 759 | | | | 17 | % | | | to | | | | 20 | % |
Adjusted cash EPS attributable to TSYS common shareholders* | | $ | 1.90 | | | | to | | | $ | 1.93 | | | | 11 | % | | | to | | | | 13 | % |
* | Average Basic Weighted Shares 188.4 |
Conference Call
TSYS will host its quarterly conference call at 5:00 p.m. ET on Tuesday, January 28. The conference call can be accessed via simultaneous Internet broadcast attsys.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 oftsys.com.

TSYS Reports 2013 Adjusted Cash EPS Increased 17.8%/p. 3
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 13 to 15 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 PaymentsSM.” 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, Georgia, with local offices spread across the Americas, EMEA and Asia-Pacific. TSYS provides services to more than half of the top 20 international banks, and has been 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 atwww.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 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 credit card industry in general, including a decline in the use of credit

TSYS Reports 2013 Adjusted Cash EPS Increased 17.8%/p. 4
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 and our Quarterly Report on Form 10-Q for the quarter ended September 30, 2013. 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.
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TSYS Announces Fourth Quarter 2013 Earnings
Page 5 of 15
TSYS
Financial Highlights
(unaudited)
(in thousands, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | | | Twelve Months Ended | |
| | December 31, | | | December 31, | |
| | | | | | | | Percent | | | | | | | | | Percent | |
| | 2013 | | | 2012 | | | Change | | | 2013 | | | 2012 | | | Change | |
Total revenues | | $ | 600,840 | | | | 479,100 | | | | 25.4 | % | | $ | 2,132,353 | | | | 1,870,972 | | | | 14.0 | % |
Cost of services | | | 403,475 | | | | 315,698 | | | | 27.8 | | | | 1,436,331 | | | | 1,262,310 | | | | 13.8 | |
Selling, general and administrative expenses | | | 84,752 | | | | 72,665 | | | | 16.6 | | | | 295,555 | | | | 249,360 | | | | 18.5 | |
Merger and acquisition expenses | | | 2,211 | | | | 906 | | | | nm | | | | 14,220 | | | | 1,650 | | | | nm | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Operating income | | | 110,402 | | | | 89,831 | | | | 22.9 | | | | 386,247 | | | | 357,652 | | | | 8.0 | |
Nonoperating income (expenses) | | | (960 | ) | | | 5 | | | | nm | | | | (1,108 | ) | | | (2,798 | ) | | | 60.4 | |
Merger and acquisition expenses—bridge loan facility & bonds | | | (9,755 | ) | | | — | | | | na | | | | (29,220 | ) | | | — | | | | na | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Income before income taxes, noncontrolling interests and equity in income of equity investments | | | 99,687 | | | | 89,836 | | | | 11.0 | | | | 355,919 | | | | 354,854 | | | | 0.3 | |
Income taxes | | | 33,985 | | | | 30,767 | | | | 10.5 | | | | 112,369 | | | | 115,102 | | | | (2.4 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Income before noncontrolling interests and equity in income of equity investments | | | 65,702 | | | | 59,069 | | | | 11.2 | | | | 243,550 | | | | 239,752 | | | | 1.6 | |
Equity in income of equity investments | | | 3,691 | | | | 3,188 | | | | 15.8 | | | | 13,047 | | | | 10,171 | | | | 28.3 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net income | | | 69,393 | | | | 62,257 | | | | 11.5 | | | | 256,597 | | | | 249,923 | | | | 2.7 | |
Net income attributable to noncontrolling interests | | | (3,738 | ) | | | (1,395 | ) | | | nm | | | | (11,847 | ) | | | (5,643 | ) | | | nm | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net income attributable to TSYS common shareholders | | $ | 65,655 | | | | 60,862 | | | | 7.9 | % | | $ | 244,750 | | | | 244,280 | | | | 0.2 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Basic earnings per share (EPS) | | $ | 0.35 | | | | 0.33 | | | | 6.2 | % | | $ | 1.30 | | | | 1.30 | | | | 0.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Diluted EPS | | $ | 0.34 | | | | 0.32 | | | | 5.5 | % | | $ | 1.29 | | | | 1.29 | | | | (0.2 | )% |
| | | | | | | | | | | | | | | | | | | | | | | | |
Dividends declared per share | | $ | 0.10 | | | | 0.10 | | | | | | | $ | 0.40 | | | | 0.40 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Non-GAAP measures: | | | | | | | | | | | | | | | | | | | | | | | | |
Adjusted cash EPS | | $ | 0.48 | | | | 0.37 | | | | 26.9 | % | | $ | 1.72 | | | | 1.46 | | | | 17.8 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Adjusted EBITDA | | $ | 184,234 | | | | 139,385 | | | | 32.2 | % | | $ | 634,165 | | | | 546,883 | | | | 16.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
nm = not meaningful
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TSYS Announces Fourth Quarter 2013 Earnings
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TSYS
Consolidated Statements of Comprehensive Income
(unaudited)
(in thousands)
| | | | | | | | | | | | | | | | |
| | Three Months Ended | | | Twelve Months Ended | |
| | December 31, | | | December 31, | |
| | 2013 | | | 2012 | | | 2013 | | | 2012 | |
Net income | | $ | 69,393 | | | | 62,257 | | | $ | 256,597 | | | | 249,923 | |
Other comprehensive income (loss), net of tax: | | | | | | | | | | | | | | | | |
Foreign currency translation adjustments | | | 2,407 | | | | (1,393 | ) | | | (4,082 | ) | | | 2,183 | |
Postretirement healthcare plan adjustments | | | 472 | | | | (415 | ) | | | 1,895 | | | | (1,666 | ) |
Unrealized gain on available-for-sale securities | | | 294 | | | | — | | | | 1,773 | | | | — | |
| | | | | | | | | | | | | | | | |
Other comprehensive income (loss) | | | 3,174 | | | | (1,808 | ) | | | (413 | ) | | | 517 | |
| | | | | | | | | | | | | | | | |
Comprehensive income | | | 72,567 | | | | 60,449 | | | | 256,184 | | | | 250,440 | |
Comprehensive income attributable to noncontrolling interests | | | 2,943 | | | | (177 | ) | | | 9,092 | | | | 4,307 | |
| | | | | | | | | | | | | | | | |
Comprehensive income attributable to TSYS common shareholders | | $ | 69,624 | | | | 60,626 | | | $ | 247,092 | | | | 246,133 | |
| | | | | | | | | | | | | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
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TSYS
Earnings Per Share
(unaudited)
(in thousands, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended | | | Three Months Ended | | | Twelve Months Ended | | | Twelve Months Ended | |
| | December 31, 2013 | | | December 31, 2012 | | | December 31, 2013 | | | December 31, 2012 | |
| | Common | | | Participating | | | Common | | | Participating | | | Common | | | Participating | | | Common | | | Participating | |
| | Stock | | | Securities | | | Stock | | | Securities | | | Stock | | | Securities | | | Stock | | | Securities | |
Basic earnings per share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 65,655 | | | | | | | | 60,862 | | | | | | | $ | 244,750 | | | | | | | | 244,280 | | | | | |
Less income allocated to nonvested awards | | | (643 | ) | | | 643 | | | | (186 | ) | | | 186 | | | | (1,595 | ) | | | 1,595 | | | | (800 | ) | | | 800 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income allocated to common stock for EPS calculation (a) | | $ | 65,012 | | | | 643 | | | | 60,676 | | | | 186 | | | $ | 243,155 | | | | 1,595 | | | | 243,480 | | | | 800 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average common shares outstanding (b) | | | 187,572 | | | | 1,874 | | | | 185,888 | | | | 583 | | | | 187,145 | | | | 1,246 | | | | 187,403 | | | | 627 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average common shares and participating securities | | | 189,446 | | | | | | | | 186,471 | | | | | | | | 188,391 | | | | | | | | 188,030 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic earnings per share (a)/(b) | | $ | 0.35 | | | | 0.34 | | | | 0.33 | | | | 0.32 | | | $ | 1.30 | | | | 1.28 | | | | 1.30 | | | | 1.28 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diluted earnings per share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 65,655 | | | | | | | | 60,862 | | | | | | | $ | 244,750 | | | | | | | | 244,280 | | | | | |
Less income allocated to nonvested awards | | | (638 | ) | | | 638 | | | | (186 | ) | | | 186 | | | | (1,585 | ) | | | 1,585 | | | | (796 | ) | | | 796 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income allocated to common stock for EPS calculation (c) | | $ | 65,017 | | | | 638 | | | | 60,676 | | | | 186 | | | $ | 243,165 | | | | 1,585 | | | | 243,484 | | | | 796 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average common shares outstanding | | | 187,572 | | | | 1,874 | | | | 185,888 | | | | 583 | | | | 187,145 | | | | 1,246 | | | | 187,403 | | | | 627 | |
Increase due to assumed issuance of shares related to common equivalent shares outstanding | | | 2,176 | | | | | | | | 983 | | | | | | | | 1,648 | | | | | | | | 1,262 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average common and common equivalent shares outstanding (d) | | | 189,748 | | | | 1,874 | | | | 186,871 | | | | 583 | | | | 188,793 | | | | 1,246 | | | | 188,665 | | | | 627 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average common and common equivalent shares and participating securities | | | 191,622 | | | | | | | | 187,454 | | | | | | | | 190,039 | | | | | | | | 189,292 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diluted earnings per share (c)/(d) | | $ | 0.34 | | | | 0.34 | | | | 0.32 | | | | 0.32 | | | $ | 1.29 | | | | 1.27 | | | | 1.29 | | | | 1.27 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
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TSYS
Segment Breakdown
(unaudited)
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, | | | Twelve Months Ended December 31, | |
| | | | | | | | Change | | | | | | | | | Change | |
| | 2013 | | | 2012 | | | $ | | | % | | | 2013 | | | 2012 | | | $ | | | % | |
Revenues before reimbursable items | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
North America Services | | $ | 223,266 | | | | 213,639 | | | | 9,627 | | | | 4.5 | % | | $ | 860,645 | | | | 826,750 | | | | 33,895 | | | | 4.1 | % |
International Services | | | 108,332 | | | | 102,427 | | | | 5,905 | | | | 5.8 | | | | 389,532 | | | | 396,149 | | | | (6,617 | ) | | | (1.7 | ) |
Merchant Services | | | 110,375 | | | | 105,855 | | | | 4,520 | | | | 4.3 | | | | 446,277 | | | | 409,698 | | | | 36,579 | | | | 8.9 | |
NetSpend | | | 104,144 | | | | — | | | | 104,144 | | | | na | | | | 207,851 | | | | — | | | | 207,851 | | | | na | |
Intersegment revenues | | | (3,121 | ) | | | (3,352 | ) | | | 231 | | | | 6.9 | | | | (12,550 | ) | | | (14,106 | ) | | | 1,556 | | | | 11.0 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues before reimbursable items from external customers | | $ | 542,996 | | | | 418,569 | | | | 124,427 | | | | 29.7 | % | | $ | 1,891,755 | | | | 1,618,491 | | | | 273,264 | | | | 16.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
North America Services | | $ | 259,067 | | | | 247,612 | | | | 11,455 | | | | 4.6 | % | | $ | 1,000,072 | | | | 965,393 | | | | 34,679 | | | | 3.6 | % |
International Services | | | 113,866 | | | | 107,000 | | | | 6,866 | | | | 6.4 | | | | 409,597 | | | | 413,467 | | | | (3,870 | ) | | | (0.9 | ) |
Merchant Services | | | 128,074 | | | | 129,413 | | | | (1,339 | ) | | | (1.0 | ) | | | 533,049 | | | | 512,580 | | | | 20,469 | | | | 4.0 | |
NetSpend | | | 104,144 | | | | — | | | | 104,144 | | | | na | | | | 207,851 | | | | — | | | | 207,851 | | | | na | |
Intersegment revenues | | | (4,311 | ) | | | (4,925 | ) | | | 614 | | | | 12.5 | | | | (18,216 | ) | | | (20,468 | ) | | | 2,252 | | | | 11.0 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues from external customers | | $ | 600,840 | | | | 479,100 | | | | 121,740 | | | | 25.4 | % | | $ | 2,132,353 | | | | 1,870,972 | | | | 261,381 | | | | 14.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
North America Services | | $ | 19,420 | | | | 18,816 | | | | 604 | | | | 3.2 | % | | $ | 74,480 | | | | 74,673 | | | | (193 | ) | | | (0.3 | )% |
International Services | | | 13,554 | | | | 13,980 | | | | (426 | ) | | | (3.0 | ) | | | 47,978 | | | | 55,033 | | | | (7,055 | ) | | | (12.8 | ) |
Merchant Services | | | 3,004 | | | | 2,699 | | | | 305 | | | | 11.3 | | | | 12,034 | | | | 12,083 | | | | (49 | ) | | | (0.4 | ) |
NetSpend | | | 1,651 | | | | — | | | | 1,651 | | | | na | | | | 3,121 | | | | — | | | | 3,121 | | | | na | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Segment depreciation and amortization | | | 37,629 | | | | 35,495 | | | | 2,134 | | | | 6.0 | | | | 137,613 | | | | 141,789 | | | | (4,176 | ) | | | (2.9 | ) |
Acquisition intangible amortization | | | 24,751 | | | | 7,340 | | | | 17,411 | | | | nm | | | | 65,893 | | | | 26,264 | | | | 39,629 | | | | nm | |
Corporate admin and other | | | 482 | | | | 446 | | | | 36 | | | | 8.1 | | | | 1,846 | | | | 2,558 | | | | (712 | ) | | | (27.8 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total depreciation and amortization | | $ | 62,862 | | | | 43,281 | | | | 19,581 | | | | 45.2 | % | | $ | 205,352 | | | | 170,610 | | | | 34,742 | | | | 20.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjusted segment operating income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
North America Services | | $ | 85,205 | | | | 78,834 | | | | 6,371 | | | | 8.1 | % | | $ | 314,577 | | | | 289,492 | | | | 25,085 | | | | 8.7 | % |
International Services | | | 19,463 | | | | 6,584 | | | | 12,879 | | | | nm | | | | 45,911 | | | | 29,427 | | | | 16,484 | | | | 56.0 | |
Merchant Services | | | 35,526 | | | | 37,248 | | | | (1,722 | ) | | | (4.6 | ) | | | 154,047 | | | | 156,284 | | | | (2,237 | ) | | | (1.4 | ) |
NetSpend | | | 28,470 | | | | — | | | | 28,470 | | | | na | | | | 59,717 | | | | — | | | | 59,717 | | | | na | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total adjusted segment operating income | | | 168,664 | | | | 122,666 | | | | 45,998 | | | | 37.5 | | | | 574,252 | | | | 475,203 | | | | 99,049 | | | | 20.8 | |
Acquisition intangible amorization | | | (24,751 | ) | | | (7,340 | ) | | | (17,411 | ) | | | nm | | | | (65,893 | ) | | | (26,264 | ) | | | (39,629 | ) | | | nm | |
NetSpend M&A operating expenses (non-recurring) | | | (2,211 | ) | | | — | | | | (2,211 | ) | | | na | | | | (14,220 | ) | | | — | | | | (14,220 | ) | | | na | |
Corporate admin and other | | | (31,300 | ) | | | (25,495 | ) | | | (5,805 | ) | | | (22.8 | ) | | | (107,892 | ) | | | (91,287 | ) | | | (16,605 | ) | | | (18.2 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Operating income | | $ | 110,402 | | | | 89,831 | | | | 20,571 | | | | 22.9 | % | | $ | 386,247 | | | | 357,652 | | | | 28,595 | | | | 8.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Other: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Reimbursable items: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
North America Services | | $ | 35,801 | | | | 33,973 | | | | 1,828 | | | | 5.4 | % | | $ | 139,427 | | | | 138,643 | | | | 784 | | | | 0.6 | % |
International Services | | | 5,534 | | | | 4,573 | | | | 961 | | | | 21.0 | | | | 20,065 | | | | 17,318 | | | | 2,747 | | | | 15.9 | |
Merchant Services | | | 17,699 | | | | 23,558 | | | | (5,859 | ) | | | (24.9 | ) | | | 86,772 | | | | 102,882 | | | | (16,110 | ) | | | (15.7 | ) |
NetSpend | | | — | | | | — | | | | — | | | | na | | | | — | | | | — | | | | — | | | | na | |
Intersegment revenues | | | (1,190 | ) | | | (1,573 | ) | | | 383 | | | | 24.3 | | | | (5,666 | ) | | | (6,362 | ) | | | 696 | | | | 10.9 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Reimbursable items | | $ | 57,844 | | | | 60,531 | | | | (2,687 | ) | | | (4.4 | )% | | $ | 240,598 | | | | 252,481 | | | | (11,883 | ) | | | (4.7 | )% |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
Page 9 of 15
TSYS
Segment Breakdown
(unaudited)
(in thousands)
Other:
| | | | | | | | | | | | | | | | |
| | At | | | Change | |
Volumes: | | 12/31/2013 | | | 12/31/2012 | | | $ | | | % | |
FTEs (full-time equivalents) | | | | | | | | | | | | | | | | |
North America Services | | | 4,484 | | | | 4,096 | | | | 388 | | | | 9.5 | % |
International Services | | | 2,489 | | | | 2,404 | | | | 85 | | | | 3.5 | |
Merchant Services | | | 1,599 | | | | 1,481 | | | | 118 | | | | 8.0 | |
NetSpend | | | 470 | | | | — | | | | 470 | | | | na | |
Corporate Admin and Other | | | 553 | | | | 425 | | | | 128 | | | | 30.1 | |
| | | | | | | | | | | | | | | | |
FTEs | | | 9,595 | | | | 8,406 | | | | 1,189 | | | | 14.1 | % |
| | | | | | | | | | | | | | | | |
Total assets (in thousands) | | | | | | | | | | | | | | | | |
North America Services | | $ | 3,241,964 | | | | 1,744,877 | | | | 1,497,087 | | | | 85.8 | % |
International Services | | | 417,855 | | | | 445,642 | | | | (27,787 | ) | | | (6.2 | ) |
Merchant Services | | | 676,592 | | | | 703,725 | | | | (27,133 | ) | | | (3.9 | ) |
NetSpend | | | 1,594,197 | | | | — | | | | 1,594,197 | | | | na | |
Intersegment assets | | | (2,243,852 | ) | | | (870,406 | ) | | | (1,373,446 | ) | | | nm | |
| | | | | | | | | | | | | | | | |
Total assets | | $ | 3,686,756 | | | | 2,023,838 | | | | 1,662,918 | | | | 82.2 | % |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, | | | Twelve Months Ended December 31, | |
| | | | | | | | Change | | | | | | | | | Change | |
| | 2013 | | | 2012 | | | Inc(Dec) | | | % | | | 2013 | | | 2012 | | | Inc(Dec) | | | % | |
North America Segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts on File (AOF) (in millions) | | | | | | | | | | | | | | | | | | | 481.9 | | | | 424.8 | | | | 57.0 | | | | 13.4 | % |
Transactions (in millions) | | | 2,488.6 | | | | 2,194.7 | | | | 293.9 | | | | 13.4 | % | | | 9,132.8 | | | | 8,102.3 | | | | 1,030.5 | | | | 12.7 | % |
International Segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
AOF (in millions) | | | | | | | | | | | | | | | | | | | 59.2 | | | | 54.6 | | | | 4.6 | | | | 8.5 | % |
Transactions (in millions) | | | 555.7 | | | | 474.0 | | | | 81.7 | | | | 17.2 | % | | | 2,007.9 | | | | 1,674.5 | | | | 333.4 | | | | 19.9 | % |
Merchant Segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Point-of-sale Transactions (in millions) | | | 1,034.6 | | | | 1,153.2 | | | | (118.6 | ) | | | (10.3 | )% | | | 4,359.8 | | | | 4,877.6 | | | | (517.8 | ) | | | (10.6 | )% |
Dollar sales volume (in millions) | | $ | 12,021.0 | | | $ | 11,038.0 | | | $ | 983.0 | | | | 8.9 | % | | $ | 44,144.0 | | | $ | 38,994.0 | | | $ | 5,150 | | | | 13.2 | % |
NetSpend Segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gross Dollar Volume (in millions) | | $ | 3,967.6 | | | $ | 3,265.4 | | | $ | 702.2 | | | | 21.5 | % | | $ | 17,075.1 | | | $ | 13,156.0 | | | $ | 3,919.1 | | | | 29.8 | % |
90-Day Active Cards (in thousands) | | | | | | | | | | | | | | | | | | | 2,835.1 | | | | — | | | | 2,835.1 | | | | na | |
Direct Deposit 90-Day Active Cards (in thousands) | | | | | | | | | | | | | | | | | | | 1,321.1 | | | | — | | | | 1,321.1 | | | | na | |
% of 90-Day Active Cards with Direct Deposit | | | | | | | | | | | | | | | | | | | 46.6 | % | | | | | | | 46.6 | % | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
Page 10 of 15
TSYS
Balance Sheet
(unaudited)
(in thousands)
| | | | | | | | |
| | Dec 31, 2013 | | | Dec 31, 2012 | |
Assets | | | | | | | | |
Current assets: | | | | | | | | |
Cash and cash equivalents | | $ | 278,230 | | | | 247,612 | |
Restricted cash | | | 753 | | | | 282 | |
Accounts receivable, net | | | 264,238 | | | | 247,083 | |
Deferred income tax assets | | | 14,958 | | | | 9,825 | |
Prepaid expenses and other current assets | | | 95,942 | | | | 69,924 | |
| | | | | | | | |
Total current assets | | | 654,121 | | | | 574,726 | |
Goodwill | | | 1,543,179 | | | | 518,344 | |
Property and equipment, net | | | 265,216 | | | | 260,389 | |
Computer software, net | | | 369,773 | | | | 226,917 | |
Contract acquisition costs, net | | | 184,890 | | | | 161,267 | |
Other intangible assets, net | | | 481,419 | | | | 130,054 | |
Equity investments, net | | | 94,133 | | | | 87,764 | |
Deferred income tax assets, net | | | 5,840 | | | | 5,334 | |
Other assets | | | 88,185 | | | | 59,043 | |
| | | | | | | | |
Total assets | | $ | 3,686,756 | | | | 2,023,838 | |
| | | | | | | | |
Liabilities | | | | | | | | |
Current liabilities: | | | | | | | | |
Accounts payable | | $ | 36,463 | | | | 63,370 | |
Current portion of borrowings | | | 34,257 | | | | 27,361 | |
Current portion of obligations under capital leases | | | 23,032 | | | | 13,263 | |
Accrued salaries and employee benefits | | | 38,775 | | | | 26,243 | |
Other current liabilities | | | 168,736 | | | | 100,282 | |
| | | | | | | | |
Total current liabilities | | | 301,263 | | | | 230,519 | |
Long-term borrowings, excluding current portion | | | 1,428,251 | | | | 174,859 | |
Deferred income tax liabilities | | | 224,867 | | | | 48,074 | |
Obligations under capital leases, excluding current portion | | | 7,500 | | | | 17,155 | |
Other long-term liabilities | | | 82,797 | | | | 68,791 | |
| | | | | | | | |
Total liabilities | | | 2,044,678 | | | | 539,398 | |
| | | | | | | | |
Redeemable noncontrolling interest | | | 39,652 | | | | 39,505 | |
| | | | | | | | |
Equity | | | | | | | | |
Shareholders’ equity: | | | | | | | | |
Common stock | | | 20,279 | | | | 20,247 | |
Additional paid-in capital | | | 165,841 | | | | 141,793 | |
Accumulated other comprehensive income (loss), net | | | 3,749 | | | | 1,408 | |
Treasury stock | | | (326,996 | ) | | | (287,301 | ) |
Retained earnings | | | 1,718,204 | | | | 1,549,063 | |
| | | | | | | | |
Total shareholders’ equity | | | 1,581,077 | | | | 1,425,210 | |
| | | | | | | | |
Noncontrolling interests in consolidated subsidiaries | | | 21,349 | | | | 19,725 | |
| | | | | | | | |
Total equity | | | 1,602,426 | | | | 1,444,935 | |
| | | | | | | | |
Total liabilities and equity | | $ | 3,686,756 | | | | 2,023,838 | |
| | | | | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
Page 11 of 15
TSYS
Cash Flow
(unaudited)
(in thousands)
| | | | | | | | |
| | Twelve Months Ended December 31, | |
| | 2013 | | | 2012 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | | | | | | | | |
Net income | | $ | 256,597 | | | | 249,923 | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | |
Equity in income of equity investments | | | (13,047 | ) | | | (10,171 | ) |
Dividends received from equity investments | | | 8,595 | | | | 7,524 | |
Net loss on foreign currency | | | 1,027 | | | | 2,012 | |
Depreciation and amortization | | | 205,352 | | | | 170,610 | |
Amortization of debt issuance costs | | | 7,269 | | | | 298 | |
Amortization of bond discount | | | 225 | | | | — | |
Changes in fair value of private equity investments | | | (966 | ) | | | (898 | ) |
Share-based compensation | | | 28,933 | | | | 18,621 | |
Excess tax benefit from share-based payment arrangements | | | (3,528 | ) | | | (1,259 | ) |
Provisions for bad debt expense and billing adjustments | | | 2,000 | | | | 1,054 | |
Charges for transaction processing provisions | | | 7,458 | | | | 2,803 | |
Provision for fraud and other losses | | | 11,912 | | | | — | |
Deferred income tax expense | | | 25,720 | | | | 285 | |
Loss on disposal of equipment, net | | | (79 | ) | | | 324 | |
Changes in operating assets and liabilities: | | | | | | | | |
Restricted cash | | | (392 | ) | | | — | |
Accounts receivable | | | (8,667 | ) | | | 2,855 | |
Prepaid expenses, other current assets and other long-term assets | | | (179 | ) | | | (2,945 | ) |
Accounts payable | | | (52,042 | ) | | | 37,206 | |
Accrued salaries and employee benefits | | | (403 | ) | | | (7,083 | ) |
Other current liabilities and other long-term liabilities | | | (23,386 | ) | | | (15,406 | ) |
| | | | | | | | |
Net cash provided by operating activities | | | 452,399 | | | | 455,753 | |
| | | | | | | | |
CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | | | | |
Purchases of property and equipment, net | | | (40,598 | ) | | | (31,395 | ) |
Additions to licensed computer software from vendors | | | (64,729 | ) | | | (33,001 | ) |
Additions to internally developed computer software | | | (32,506 | ) | | | (19,285 | ) |
Cash used in acquisitions, net of cash acquired | | | (1,314,660 | ) | | | (188,698 | ) |
Purchase of private equity investments | | | (1,378 | ) | | | (3,031 | ) |
Additions to contract acquisition costs | | | (55,965 | ) | | | (34,384 | ) |
| | | | | | | | |
Net cash used in investing activities | | | (1,509,836 | ) | | | (309,794 | ) |
| | | | | | | | |
CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | |
Principal payments on long-term borrowings and capital lease obligations | | | (166,805 | ) | | | (200,052 | ) |
Proceeds from borrowings of long-term borrowings | | | 1,395,661 | | | | 150,000 | |
Proceeds from exercise of stock options | | | 40,691 | | | | 9,672 | |
Excess tax benefit from share-based payment arrangements | | | 3,528 | | | | 1,259 | |
Repurchase of common stock under plans and tax withholding | | | (103,857 | ) | | | (74,939 | ) |
Debt issuance costs | | | (13,575 | ) | | | (2,073 | ) |
Subsidiary dividends paid to noncontrolling shareholders | | | (7,321 | ) | | | (2,797 | ) |
Dividends paid on common stock | | | (56,510 | ) | | | (94,035 | ) |
| | | | | | | | |
Net cash provided by (used in) financing activities | | | 1,091,813 | | | | (212,965 | ) |
| | | | | | | | |
CASH AND CASH EQUIVALENTS: | | | | | | | | |
Effect of exchange rate changes on cash and cash equivalents | | | (3,758 | ) | | | (1,719 | ) |
| | | | | | | | |
Net increase in cash and cash equivalents | | | 30,618 | | | | (68,725 | ) |
Cash and cash equivalents at beginning of period | | | 247,612 | | | | 316,337 | |
| | | | | | | | |
Cash and cash equivalents at end of period | | $ | 278,230 | | | | 247,612 | |
| | | | | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
Page 12 of 15
Supplemental Information:
| | | | | | | | | | | | |
| | Accounts on File | |
| | Total | |
(in millions) | | December 2013 | | | December 2012 | | | % Change | |
Consumer Credit | | | 229.0 | | | | 200.5 | | | | 14.2 | |
Retail | | | 27.8 | | | | 25.0 | | | | 11.0 | |
| | | | | | | | | | | | |
Total Consumer | | | 256.8 | | | | 225.5 | | | | 13.9 | |
Commercial | | | 39.9 | | | | 37.1 | | | | 7.6 | |
Other | | | 18.9 | | | | 12.8 | | | | 47.6 | |
| | | | | | | | | | | | |
Subtotal | | | 315.6 | | | | 275.4 | | | | 14.6 | |
Prepaid/Stored Value | | | 118.0 | | | | 115.9 | | | | 1.8 | |
Government Services | | | 62.2 | | | | 57.0 | | | | 9.2 | |
Commercial Card Single Use | | | 45.3 | | | | 31.1 | | | | 45.4 | |
| | | | | | | | | | | | |
Total AOF | | | 541.1 | | | | 479.4 | | | | 12.9 | |
| | | | | | | | | | | | |
Growth in Accounts on File(in millions):
| | | | | | | | |
| | December 2012 to December 2013 | | | December 2011 to December 2012 | |
Beginning balance | | | 479.4 | | | | 404.2 | |
Change in accounts on file due to: | | | | | | | | |
Internal growth of existing clients | | | 37.6 | | | | 31.5 | |
New clients | | | 61.2 | | | | 80.1 | |
Purges/Sales | | | (36.4 | ) | | | (33.6 | ) |
Deconversions | | | (0.7 | ) | | | (2.8 | ) |
| | | | | | | | |
Ending balance | | | 541.1 | | | | 479.4 | |
| | | | | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
Page 13 of 15
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 fourth quarter and full year 2013 financial results using the previous year’s foreign currency exchange rates. On a full year constant currency basis, TSYS’ total revenues grew 15.1% as compared to a reported GAAP increase of 14.0%.
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 signifcant 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.
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TSYS Announces Fourth Quarter 2013 Earnings
Page 14 of 15
Reconciliation of GAAP to Non-GAAP
Constant Currency Comparison
(unaudited)
(in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, | | | Twelve Months Ended December 31, | |
| | | | | | | | Percent | | | | | | | | | Percent | |
| | 2013 | | | 2012 | | | Change | | | 2013 | | | 2012 | | | Change | |
Consolidated | | | | | | | | | | | | | | | | | | | | | | | | |
Constant currency (1) | | $ | 604,665 | | | | 479,100 | | | | 26.2 | % | | $ | 2,152,961 | | | | 1,870,972 | | | | 15.1 | % |
Foreign currency (2) | | | (3,825 | ) | | | — | | | | | | | | (20,608 | ) | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total revenues | | $ | 600,840 | | | | 479,100 | | | | 25.4 | % | | $ | 2,132,353 | | | | 1,870,972 | | | | 14.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Constant currency (1) | | $ | 546,849 | | | | 418,569 | | | | 30.6 | % | | $ | 1,912,063 | | | | 1,618,491 | | | | 18.1 | % |
Foreign currency (2) | | | (3,853 | ) | | | — | | | | | | | | (20,308 | ) | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total revenues before reimbursable items | | $ | 542,996 | | | | 418,569 | | | | 29.7 | % | | $ | 1,891,755 | | | | 1,618,491 | | | | 16.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Constant currency (1) | | $ | 110,186 | | | | 89,831 | | | | 22.7 | % | | $ | 388,042 | | | | 357,652 | | | | 8.5 | % |
Foreign currency (2) | | | 216 | | | | — | | | | | | | | (1,795 | ) | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Operating income | | $ | 110,402 | | | | 89,831 | | | | 22.9 | % | | $ | 386,247 | | | | 357,652 | | | | 8.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
International Services | | | | | | | | | | | | | | | | | | | | | | | | |
Constant currency (1) | | $ | 117,806 | | | | 107,000 | | | | 10.1 | % | | $ | 430,521 | | | | 413,467 | | | | 4.1 | % |
Foreign currency (2) | | | (3,940 | ) | | | — | | | | | | | | (20,924 | ) | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total revenues | | $ | 113,866 | | | | 107,000 | | | | 6.4 | % | | $ | 409,597 | | | | 413,467 | | | | (0.9 | )% |
| | | | | | | | | | | | | | | | | | | | | | | | |
(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 December 31, | | | Twelve Months Ended December 31, | |
| | | | | | | | Percent | | | | | | | | | Percent | |
| | 2013 | | | 2012 | | | Change | | | 2013 | | | 2012 | | | Change | |
Total Revenues | | $ | 600,840 | | | | 479,100 | | | | 25.4 | % | | $ | 2,132,353 | | | | 1,870,972 | | | | 14.0 | % |
Reimbursable Items | | | 57,844 | | | | 60,531 | | | | (4.4 | ) | | | 240,598 | | | | 252,481 | | | | (4.7 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Revenues Before Reimbursable Items | | $ | 542,996 | | | | 418,569 | | | | 29.7 | % | | $ | 1,891,755 | | | | 1,618,491 | | | | 16.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
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TSYS Announces Fourth Quarter 2013 Earnings
Page 15 of 15
Reconciliation of GAAP to Non-GAAP
Adjusted Cash Earnings
(unaudited)
(in thousands, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, | | | Twelve Months Ended December 31, | |
| | | | | | | | Percent | | | | | | | | | Percent | |
| | 2013 | | | 2012 | | | Change | | | 2013 | | | 2012 | | | Change | |
Net income attributable to TSYS common shareholders (a) | | $ | 65,655 | | | | 60,862 | | | | 7.9 | % | | $ | 244,750 | | | | 244,280 | | | | 0.2 | % |
Adjust for amounts attributable to TSYS common shareholders: | | | | | | | | | | | | | | | | | | | | | | | | |
Add: Acquisition intangible amortization, net of taxes | | $ | 16,615 | | | | 4,640 | | | | nm | % | | $ | 43,759 | | | | 17,282 | | | | nm | % |
Add: Share-based compensation, net of taxes | | | 6,408 | | | | 4,272 | | | | 50.0 | % | | | 19,838 | | | | 12,683 | | | | 56.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash earnings | | | 88,678 | | | | 69,774 | | | | 27.1 | % | | | 308,347 | | | | 274,245 | | | | 12.4 | % |
Add: NetSpend M&A expenses, net of taxes* (non-recurring) | | | 1,317 | | | | — | | | | na | % | | | 15,251 | | | | — | | | | na | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash earnings adjusted | | $ | 89,995 | | | | 69,774 | | | | 29.0 | % | | $ | 323,598 | | | | 274,245 | | | | 18.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Basic EPS—Net income attributable to TSYS common shareholders | | | | | | | | | | | | | | | | | | | | | | | | |
As reported (GAAP) | | $ | 0.35 | | | | 0.33 | | | | 6.2 | % | | $ | 1.30 | | | | 1.30 | | | | 0.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Adjust for amounts attributable to TSYS common shareholders: | | | | | | | | | | | | | | | | | | | | | | | | |
Add: Acquisition intangible amortization, net of taxes | | | 0.09 | | | | 0.02 | | | | nm | % | | | 0.23 | | | | 0.09 | | | | nm | % |
Add: Share-based compensation, net of taxes | | | 0.03 | | | | 0.02 | | | | 47.6 | % | | | 0.11 | | | | 0.07 | | | | 56.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash earnings per share | | | 0.47 | | | | 0.37 | | | | 25.1 | % | | | 1.64 | | | | 1.46 | | | | 12.2 | % |
Add: NetSpend M&A expenses, net of taxes* (non-recurring) | | | 0.01 | | | | — | | | | na | % | | | 0.08 | | | | — | | | | na | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Adjusted cash EPS ** | | $ | 0.48 | | | | 0.37 | | | | 26.9 | % | | $ | 1.72 | | | | 1.46 | | | | 17.8 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Average common shares and participating securities | | | 189,446 | | | | 186,471 | | | | | | | | 188,391 | | | | 188,030 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
* | 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 December 31, | | | Twelve Months Ended December 31, | |
| | | | | | | | Percent | | | | | | | | | Percent | |
| | 2013 | | | 2012 | | | Change | | | 2013 | | | 2012 | | | Change | |
Net income | | $ | 69,393 | | | | 62,257 | | | | 11.5 | % | | $ | 256,597 | | | | 249,923 | | | | 2.7 | % |
Adjust for: | | | | | | | | | | | | | | | | | | | | | | | | |
Deduct: Equity in income of equity investments | | | (3,691 | ) | | | (3,188 | ) | | | (15.8 | )% | | | (13,047 | ) | | | (10,171 | ) | | | (28.3 | )% |
Add: Income taxes | | | 33,985 | | | | 30,767 | | | | 10.5 | % | | | 112,369 | | | | 115,102 | | | | (2.4 | )% |
Add: Nonoperating expense | | | 10,715 | | | | (5 | ) | | | nm | % | | | 30,328 | | | | 2,798 | | | | nm | % |
Add: Depreciation and amortization | | | 62,862 | | | | 43,281 | | | | 45.2 | % | | | 205,352 | | | | 170,610 | | | | 20.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
EBITDA | | | 173,264 | | | | 133,112 | | | | 30.2 | % | | | 591,599 | | | | 528,262 | | | | 12.0 | % |
Adjust for: | | | | | | | | | | | | | | | | | | | | | | | | |
Add: Share-based compensation | | | 9,345 | | | | 6,273 | | | | 49.0 | % | | | 28,933 | | | | 18,621 | | | | 55.4 | % |
Add: NetSpend M&A operating expenses *(non-recurring) | | | 1,625 | | | | — | | | | na | % | | | 13,633 | | | | — | | | | na | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Adjusted EBITDA | | $ | 184,234 | | | | 139,385 | | | | 32.2 | % | | $ | 634,165 | | | | 546,883 | | | | 16.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
* | Excludes share-based compensation |
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