Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | Apr. 28, 2015 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 31-Mar-15 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | TSS | |
Entity Registrant Name | TOTAL SYSTEM SERVICES INC | |
Entity Central Index Key | 721683 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 184,311,974 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents (Note 4) | $328,112 | $289,183 |
Accounts receivable, net of allowance for doubtful accounts and billing adjustments of $5.8 million and $5.2 million as of 2015 and 2014, respectively | 315,524 | 283,203 |
Deferred income tax assets | 12,881 | 15,190 |
Prepaid expenses and other current assets (Note 4) | 100,120 | 98,974 |
Current assets of discontinued operations (Note 2) | 4,003 | 4,003 |
Total current assets | 760,640 | 690,553 |
Goodwill | 1,546,185 | 1,547,397 |
Other intangible assets, net of accumulated amortization of $200.2 million and $181.9 million as of 2015 and 2014, respectively | 385,161 | 404,107 |
Computer software, net of accumulated amortization of $621.7 million and $613.3 million as of 2015 and 2014, respectively | 365,382 | 366,148 |
Property and equipment, net of accumulated depreciation and amortization of $432.5 million and $423.2 million as of 2015 and 2014, respectively | 285,413 | 290,585 |
Contract acquisition costs, net of accumulated amortization of $279.5 million and $276.1 million as of 2015 and 2014, respectively (Note 4) | 236,227 | 236,305 |
Equity investments, net | 105,957 | 100,468 |
Deferred income tax assets, net | 6,703 | 7,002 |
Other assets | 85,770 | 91,016 |
Total assets | 3,777,438 | 3,733,581 |
Current liabilities: | ||
Accounts payable | 58,473 | 48,793 |
Current portion of long-term borrowings | 41,791 | 43,784 |
Accrued salaries and employee benefits | 25,990 | 38,001 |
Current portion of obligations under capital leases | 3,735 | 7,127 |
Other current liabilities (Note 4) | 210,501 | 154,805 |
Current liabilities of discontinued operations (Note 2) | 4,003 | 4,003 |
Total current liabilities | 344,493 | 296,513 |
Long-term borrowings, excluding current portion | 1,389,883 | 1,398,132 |
Deferred income tax liabilities, net | 209,446 | 211,820 |
Obligations under capital leases, excluding current portion | 6,161 | 6,974 |
Other long-term liabilities | 90,034 | 98,006 |
Total liabilities | 2,040,017 | 2,011,445 |
Redeemable noncontrolling interest in consolidated subsidiary | 23,397 | 22,492 |
Commitments and contingencies (Note 10) | ||
Shareholders' equity: | ||
Common stock - $0.10 par value. Authorized 600,000 shares; 202,771 and 202,775 issued as of 2015 and 2014, respectively; 184,304 and 184,939 outstanding as of 2015 and 2014, respectively | 20,277 | 20,278 |
Additional paid-in capital | 179,305 | 171,270 |
Accumulated other comprehensive loss, net (Note 4) | -24,274 | -11,926 |
Treasury stock, at cost (18,467 and 17,836 shares as of 2015 and 2014, respectively) | -493,058 | -453,230 |
Retained earnings | 2,025,427 | 1,966,370 |
Total shareholders' equity | 1,707,677 | 1,692,762 |
Noncontrolling interest in consolidated subsidiary | 6,347 | 6,882 |
Total equity | 1,714,024 | 1,699,644 |
Total liabilities and equity | $3,777,438 | $3,733,581 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, except Share data in Thousands, unless otherwise specified | ||
Accounts receivable, allowance for doubtful accounts and billing adjustments | $5.80 | $5.20 |
Other intangible assets, accumulated amortization | 200.2 | 181.9 |
Computer software, accumulated amortization | 621.7 | 613.3 |
Property and equipment, accumulated depreciation and amortization | 432.5 | 423.2 |
Common stock, par value | $0.10 | $0.10 |
Common stock, Authorized | 600,000 | 600,000 |
Common stock, issued | 202,771 | 202,775 |
Common stock, outstanding | 184,304 | 184,939 |
Treasury stock, shares | 18,467 | 17,836 |
Contract Acquisition Costs | ||
Contract acquisition costs, accumulated amortization | $279.50 | $276.10 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | ||
Total revenues | $662,156 | $592,848 | ||
Cost of services | 449,705 | 422,883 | ||
Selling, general and administrative expenses | 89,955 | 89,268 | ||
Total operating expenses | 539,660 | 512,151 | ||
Operating income | 122,496 | 80,697 | ||
Nonoperating expenses, net | -9,209 | -9,813 | ||
Income before income taxes and equity in income of equity investments | 113,287 | 70,884 | ||
Income taxes | 39,782 | 24,335 | ||
Income before equity in income of equity investments | 73,505 | 46,549 | ||
Equity in income of equity investments, net of tax | 5,394 | 4,096 | ||
Income from continuing operations, net of tax | 78,899 | 50,645 | ||
Income from discontinued operations, net of tax | 980 | |||
Net income | 78,899 | 51,625 | ||
Net income attributable to noncontrolling interests | -1,144 | -2,322 | ||
Net income | 77,755 | 49,303 | ||
Basic earnings per share (EPS) attributable to TSYS common shareholders (Note 11): | ||||
Income from continuing operations to TSYS common shareholders | $0.42 | $0.26 | ||
Gain (loss) from discontinued operations to TSYS common shareholders | $0 | |||
Net income attributable to TSYS common shareholders | $0.42 | [1] | $0.26 | [1] |
Diluted EPS attributable to TSYS common shareholders (Note 11): | ||||
Income from continuing operations to TSYS common shareholders | $0.42 | $0.26 | ||
Gain (loss) from discontinued operations to TSYS common shareholders | $0 | |||
Net Income attributable to TSYS common shareholders | $0.42 | [1] | $0.26 | [1] |
Amounts attributable to TSYS common shareholders: | ||||
Income from continuing operations | 77,755 | 49,321 | ||
Gain (loss) from discontinued operations | -18 | |||
Net income | $77,755 | $49,303 | ||
[1] | EPS amounts may not total due to rounding |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Net income | $78,899 | $51,625 |
Other comprehensive income (loss), net of tax: | ||
Foreign currency translation adjustments | -13,361 | 1,581 |
Postretirement healthcare plan adjustments | 147 | -75 |
Unrealized gain on available-for-sale securities | 592 | 570 |
Other comprehensive income (loss) | -12,622 | 2,076 |
Comprehensive income | 66,277 | 53,701 |
Comprehensive income attributable to noncontrolling interests | 870 | 2,827 |
Comprehensive income attributable to TSYS common shareholders | $65,407 | $50,874 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Cash flows from operating activities: | ||
Net income | $78,899 | $51,625 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 62,815 | 61,432 |
Provisions for fraud and other losses | 8,684 | 9,639 |
Share-based compensation | 8,143 | 7,611 |
Charges for transaction processing provisions | 1,588 | 1,826 |
Provisions for bad debt expenses and billing adjustments | 1,425 | 749 |
Deferred income tax expense | 998 | 4,751 |
Amortization of debt issuance costs | 458 | 452 |
Net loss (gain) on foreign currency | 403 | -425 |
Amortization of bond discount | 98 | 94 |
Loss on disposal of equipment, net | 2 | 2 |
Changes in value of private equity investments | -1,170 | -312 |
Excess tax benefit from share-based payment arrangements | -3,793 | -4,037 |
Equity in income of equity investments | -5,394 | -4,096 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -36,598 | -11,418 |
Accrued salaries and employee benefits | -11,549 | -9,986 |
Prepaid expenses, other current assets and other long-term assets | 1,302 | -3,170 |
Accounts payable | 2,030 | 15,738 |
Other current liabilities and other long-term liabilities | 50,151 | 28,231 |
Net cash provided by operating activities | 158,492 | 148,706 |
Cash flows from investing activities: | ||
Additions to contract acquisition costs | -12,364 | -17,903 |
Additions to licensed computer software from vendors | -11,581 | -5,963 |
Purchases of property and equipment | -10,047 | -13,641 |
Additions to internally developed computer software | -9,561 | -9,735 |
Purchase of private equity investments | -822 | |
Proceeds from sale of private equity investment | 1,839 | |
Net cash used in investing activities | -41,714 | -48,064 |
Cash flows from financing activities: | ||
Repurchase of common stock under plans and tax withholding | -54,415 | -5,173 |
Dividends paid on common stock | -18,260 | -18,788 |
Principal payments on long-term borrowings and capital lease obligations | -15,086 | -22,277 |
Subsidiary dividends paid to noncontrolling shareholders | -500 | -2,312 |
Purchase of noncontrolling interests | -37,500 | |
Excess tax benefit from share-based payment arrangements | 3,793 | 4,037 |
Proceeds from exercise of stock options | 10,712 | 9,539 |
Net cash used in financing activities | -73,756 | -72,474 |
Cash and cash equivalents: | ||
Effect of exchange rate changes on cash and cash equivalents | -4,093 | 1,015 |
Net increase in cash and cash equivalents | 38,929 | 29,183 |
Cash and cash equivalents at beginning of period | 289,183 | 278,230 |
Cash and cash equivalents at end of period | 328,112 | 307,413 |
Less cash and cash equivalents of discontinued operations at end of period | 33,252 | |
Cash and cash equivalents of continued operations at end of period | 328,112 | 274,161 |
Supplemental cash flow information: | ||
Interest paid | 1,760 | 10,323 |
Income taxes paid, net | $724 | $3,146 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2015 | |
Summary of Significant Accounting Policies | Note 1 — Summary of Significant Accounting Policies |
Business | |
Total System Services, Inc.’s (TSYS’ or the Company’s) revenues are derived from providing payment processing, merchant services and related payment services to financial and nonfinancial institutions, generally under long-term processing contracts. The Company also derives revenues by providing general-purpose reloadable (GPR) prepaid debit cards and payroll cards and alternative financial services to underbanked consumers. The Company’s services are provided through four operating segments: North America Services, International Services, Merchant Services and NetSpend. | |
Through the Company’s North America Services and International Services segments, TSYS processes information through its cardholder systems for financial and nonfinancial institutions throughout the United States and internationally. The Company’s North America Services segment provides these services to clients in the United States, Canada, Mexico and the Caribbean. The Company’s International Services segment provides services to clients in Europe, India, Middle East, Africa, Asia Pacific and Brazil. The Company’s Merchant Services segment provides merchant services to merchant acquirers and merchants mainly in the United States. The Company’s NetSpend segment provides services to consumers in the United States. | |
Basis of Presentation | |
The accompanying unaudited consolidated financial statements of TSYS include the accounts of TSYS and its wholly- and majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. | |
These financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and, therefore, do not include all information and footnotes required by U.S. GAAP for complete financial statements. The preparation of the consolidated financial statements requires management of the Company to make estimates and assumptions relating to the reported amounts of assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. These estimates and assumptions are developed based upon all information available. Actual results could differ from estimated amounts. All adjustments, consisting of normal recurring accruals, which, in the opinion of management, are necessary for a fair presentation of financial position and results of operations for the periods covered by this report, have been included. | |
Certain prior period amounts may have been reclassified to conform to the current period’s presentation. | |
As discussed in Note 2, the Company’s financial statements reflect GP Network Corporation (GP Net) and TSYS Japan Godo Kaisha (TSYS Japan), formerly TSYS Japan Co., Ltd., as discontinued operations. The Company has segregated the net assets, net liabilities and operating results from continuing operations on the Unaudited Consolidated Balance Sheets and Unaudited Consolidated Statements of Income for all periods presented. | |
The accompanying unaudited consolidated financial statements should be read in conjunction with the Company’s summary of significant accounting policies, consolidated financial statements and related notes appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the Securities and Exchange Commission (SEC). Results of interim periods are not necessarily indicative of results to be expected for the year. | |
Recently Adopted Accounting Pronouncements | |
In January 2015, the Company adopted Accounting Standards Update (ASU) 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” The amendments in this Update change the criteria for reporting discontinued operations and enhancing convergence of the Financial Accounting Standards Board’s (FASB) and the International Accounting Standard Board’s (IASB) reporting requirements for discontinued operations. The adoption of this ASU did not have a material impact on the Company’s financial position, results of operations or cash flows. | |
New Accounting Pronouncements | |
In April 2015, the FASB issued ASU 2015-05 “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” The amendments in this Update provide guidance to customers about whether a cloud computing arrangement includes a software license or a service agreement. The Company does not expect the adoption of this ASU to have a material impact on the Company’s financial position, results of operations or cash flows. | |
In April 2015, the FASB issued ASU 2015-03 “Interest — Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Cost.” The amendments in this update will require entities to present debt issuance costs in the balance sheet as a direct deduction from the carrying amount of the corresponding debt liability, consistent with debt discounts. The guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The guidance will be applied retrospectively. The Company does not expect the adoption of this guidance to have a material impact on the Company’s financial position, results of operations or cash flows. | |
In January 2015, the FASB issued ASU 2015-01 “Income Statement – Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.” ASU 2015-01 eliminates from GAAP the concept of extraordinary items. For all entities, the ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted provided the guidance is applied from the beginning of the fiscal year of adoption. The Company does not expect the adoption of this ASU to have a material impact on the financial position, results of operations or cash flows of the Company. | |
In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers”, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company on January 1, 2017. Early application is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect on its ongoing financial reporting. |
Discontinued_Operations
Discontinued Operations | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Discontinued Operations | Note 2—Discontinued Operations | ||||||||
In accordance with GAAP, the Company determined its Japan-based businesses became discontinued operations in the first quarter of 2014. | |||||||||
The Company sold all of its stock of GP Net (representing 54% ownership of the company) and all of its stock of TSYS Japan (representing 100% ownership of the company) in April 2014. Both entities were part of the International Services segment. The sale of the Company’s stock in both of its operations in Japan was the result of management’s decision during the first quarter of 2014, to divest non-strategic businesses and focus resources on core products and services. | |||||||||
GP Net and TSYS Japan were not significant components of TSYS’ consolidated results. | |||||||||
The following table presents the main classes of assets and liabilities associated with discontinued operations as of March 31, 2015 and December 31, 2014: | |||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||
Other assets | $ | 4,003 | 4,003 | ||||||
Total liabilities | 4,003 | 4,003 | |||||||
The following table presents the summarized results of discontinued operations for the three months ended March 31, 2014: | |||||||||
(in thousands) | Three months ended | ||||||||
March 31, 2014 | |||||||||
Total revenues | $ | 16,248 | |||||||
Revenues before reimbursable items | $ | 16,248 | |||||||
Operating income | $ | 367 | |||||||
Income tax benefit | $ | (44 | ) | ||||||
Income from discontinued operations, net of tax | $ | 980 | |||||||
Income from discontinued operations, net of tax, attributable to noncontrolling interest | $ | 998 | |||||||
Loss from discontinued operations, net of tax, attributable to TSYS common shareholders | $ | (18 | ) | ||||||
The Unaudited Consolidated Statements of Cash Flows for the three months ended March 31, 2014 include GP Net and TSYS Japan and are not considered material. |
Fair_Value_Measurement
Fair Value Measurement | 3 Months Ended |
Mar. 31, 2015 | |
Fair Value Measurement | Note 3 — Fair Value Measurement |
Refer to Note 3 of the Company’s audited financial statements for the year ended December 31, 2014, which are included as Exhibit 13.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the SEC, for a discussion regarding fair value measurement. | |
GAAP requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant level of inputs. The three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies, is as follows: | |
Level 1 – Quoted prices for identical assets and liabilities in active markets. | |
Level 2 – Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. | |
Level 3 – Unobservable inputs for the asset or liability. | |
The Company had no transfers between Level 1, Level 2 or Level 3 assets during the three months ended March 31, 2015. | |
The Company had nonrecurring fair value measurements related to discontinued operations. The Company determined that the carrying value of its assets and liabilities as of March 31, 2015 and December 31, 2014, approximate their fair values. |
Supplementary_Balance_Sheet_In
Supplementary Balance Sheet Information | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||
Supplementary Balance Sheet Information | Note 4 — Supplementary Balance Sheet Information | ||||||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||||||
The Company maintains accounts outside the United States denominated in currencies other than the U.S. Dollar. All amounts in domestic accounts are denominated in U.S. Dollars. | |||||||||||||||||||||
Cash and cash equivalent balances are summarized as follows: | |||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Cash and cash equivalents in domestic accounts | $ | 275,583 | 225,396 | ||||||||||||||||||
Cash and cash equivalents in foreign accounts | 52,529 | 63,787 | |||||||||||||||||||
Total | $ | 328,112 | 289,183 | ||||||||||||||||||
Prepaid Expenses and Other Current Assets | |||||||||||||||||||||
Significant components of prepaid expenses and other current assets are summarized as follows: | |||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Prepaid expenses | $ | 34,716 | 35,334 | ||||||||||||||||||
Supplies inventory | 12,964 | 14,340 | |||||||||||||||||||
Other | 52,440 | 49,300 | |||||||||||||||||||
Total | $ | 100,120 | 98,974 | ||||||||||||||||||
Contract Acquisition Costs, net | |||||||||||||||||||||
Significant components of contract acquisition costs, net of accumulated amortization, are summarized as follows: | |||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Conversion costs, net of accumulated amortization of $140.8 million and $138.7 million as of 2015 and 2014, respectively | $ | 163,845 | 159,339 | ||||||||||||||||||
Payments for processing rights, net of accumulated amortization of $138.7 million and $137.4 million as of 2015 and 2014, respectively | 72,382 | 76,966 | |||||||||||||||||||
Total | $ | 236,227 | 236,305 | ||||||||||||||||||
Amortization expense related to conversion costs, which is recorded in cost of services, was $5.5 million and $4.3 million for the three months ended March 31, 2015 and 2014, respectively. | |||||||||||||||||||||
Amortization related to payments for processing rights, which is recorded as a reduction of revenues, was $4.1 million and $3.3 million for the three months ended March 31, 2015 and 2014, respectively. | |||||||||||||||||||||
Other Current Liabilities | |||||||||||||||||||||
Significant components of other current liabilities are summarized as follows: | |||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Deferred revenues | $ | 43,317 | 41,773 | ||||||||||||||||||
Accrued income taxes | 34,648 | — | |||||||||||||||||||
Accrued expenses | 25,973 | 23,617 | |||||||||||||||||||
Dividends payable | 19,094 | 19,006 | |||||||||||||||||||
Other | 87,469 | 70,409 | |||||||||||||||||||
Total | $ | 210,501 | 154,805 | ||||||||||||||||||
Accumulated Other Comprehensive Income (AOCI) | |||||||||||||||||||||
The income tax effects allocated to and the cumulative balance of accumulated other comprehensive income (loss) attributable to TSYS shareholders are as follows: | |||||||||||||||||||||
(in thousands) | Beginning | Pretax | Tax | Net-of-Tax | Ending | ||||||||||||||||
Balance | Amount | Effect | Amount | Balance | |||||||||||||||||
December 31, | March 31, | ||||||||||||||||||||
2014 | 2015 | ||||||||||||||||||||
Foreign currency translation adjustments and transfers from noncontrolling interests | $ | (13,564 | ) | (14,393 | ) | (1,306 | ) | (13,087 | ) | $ | (26,651 | ) | |||||||||
Unrealized gain on available-for-sale securities | 1,105 | 938 | 346 | 592 | 1,697 | ||||||||||||||||
Change in AOCI related to postretirement healthcare plans | 533 | 230 | 83 | 147 | 680 | ||||||||||||||||
Total | $ | (11,926 | ) | (13,225 | ) | (877 | ) | (12,348 | ) | $ | (24,274 | ) | |||||||||
There were no reclassifications of AOCI to net income or to other accounts for the three-month period ended March 31, 2015. |
LongTerm_Borrowings
Long-Term Borrowings | 3 Months Ended |
Mar. 31, 2015 | |
Long-Term Borrowings | Note 5 — Long-Term Borrowings |
Refer to Note 13 of the Company’s audited financial statements for the year ended December 31, 2014, which are included as Exhibit 13.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the SEC, for a discussion regarding long-term borrowings. |
ShareBased_Compensation
Share-Based Compensation | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Share-Based Compensation | Note 6 — Share-Based Compensation | ||||||||
Refer to Notes 1 and 19 of the Company’s audited financial statements for the year ended December 31, 2014, which are included as Exhibit 13.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the SEC, for a discussion regarding the Company’s share-based compensation plans and policy. | |||||||||
Share-Based Compensation | |||||||||
Share-based compensation costs are classified as selling, general and administrative expenses on the Company’s statements of income and corporate administration and other expenses for segment reporting purposes. TSYS’ share-based compensation costs are expensed, rather than capitalized, as these awards are typically granted to individuals not involved in capitalizable activities. For the three months ended March 31, 2015, share-based compensation was $8.1 million, compared to $7.6 million for the same period in 2014. | |||||||||
Nonvested Share Awards | |||||||||
The Company granted shares of TSYS common stock to certain key employees. The nonvested stock bonus awards are for services to be provided in the future and vest over a period of up to four years. The market value of the TSYS common stock as of the date of issuance is charged as compensation expense over the vesting periods of the awards. | |||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Number of shares | 345,038 | 596,113 | |||||||
Market value (in millions) | $ | 13 | $ | 18.2 | |||||
Performance- and Market-Based Awards | |||||||||
During the first three months of 2015, TSYS authorized a total grant of 182,906 performance- and market-based shares to certain key executives, of which 128,034 awards have a performance-based vesting schedule (2015 performance shares) and 54,872 awards are market-based shares (2015 market-based shares). | |||||||||
The 2015 performance shares have a 2015-2017 performance period for which the Compensation Committee of the Board of Directors established the performance goal: adjusted EPS and, if such goal is attained in 2017, the performance shares will vest, up to a maximum of 200% of the total grant. Compensation expense for the 2015 performance shares is measured on the grant date based on the quoted market price of TSYS common stock. The Company estimates the probability of achieving the goals through the performance period and expenses the award on a straight-line basis. Compensation costs related to these performance shares are expected to be recognized through the end of 2017. | |||||||||
As of March 31, 2015 there was approximately $13.9 million of unrecognized compensation cost related to TSYS performance-based awards that is expected to be recognized until the end of 2017. | |||||||||
The 2015 market-based shares have a 2015-2017 performance period for which the Compensation Committee of the Board of Directors established a market condition goal: Total Shareholder Return (TSR) as compared to the TSR of the companies in the S&P 500 over the performance period and, if such goal is attained in 2017, the market-based shares will vest, up to a maximum of 200% of the total grant. The fair value of the award was estimated on the grant date using a Monte Carlo simulation model. The Company expenses the award on a straight-line basis. Compensation costs related to these market-based shares are expected to be recognized through the end of 2017. | |||||||||
As of March 31, 2015, there was approximately $1.8 million of total unrecognized compensation cost related to TSYS market-based awards that is expected to be recognized over a remaining weighted average period of 1.8 years. | |||||||||
During the first three months of 2015, TSYS authorized a total grant of 165,543 performance shares to certain key employees with a performance-based vesting schedule (2015 broad-base performance shares). These 2015 performance shares have a 2015 performance period for which the Compensation Committee of the Board of Directors established two performance goals: revenue growth and adjusted EPS and, if such goals are attained in 2015, the performance shares will vest over the required service period through the end of 2017, up to a maximum of 200% of the total grant. Compensation expense for the award is measured on the grant date based on the quoted market price of TSYS common stock. The Company estimates the probability of achieving the goals through the performance period and expenses the award on a straight-line basis. Compensation costs related to these performance shares are expected to be recognized through the end of 2017. | |||||||||
During the first three months of 2014, TSYS authorized a total grant of 201,189 performance shares to certain key executives with a performance-based vesting schedule (2014 performance shares). These 2014 performance shares have a 2014-2016 performance period for which the Compensation Committee of the Board of Directors established two performance goals: revenues before reimbursable items and income from continuing operations and, if such goals are attained in 2016, the performance shares will vest, up to a maximum of 200% of the total grant. Compensation expense for the award is measured on the grant date based on the quoted market price of TSYS common stock. The Company estimates the probability of achieving the goals through the performance period and expenses the award on a straight-line basis. Compensation costs related to these performance shares are expected to be recognized until the end of 2016. | |||||||||
Stock Option Awards | |||||||||
The Company granted stock options to certain key executives. The grants will vest over a period of up to three years. | |||||||||
The weighted average fair value of the option grants was estimated on the date of grant using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions: | |||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Number of options granted | 487,735 | 914,470 | |||||||
Weighted average exercise price | $ | 38.2 | $ | 30.83 | |||||
Risk-free interest rate | 1.7 | % | 2 | % | |||||
Expected volatility | 21 | % | 25 | % | |||||
Expected term (years) | 6.3 | 6.5 | |||||||
Dividend yield | 1.05 | % | 1.3 | % | |||||
Weighted average fair value | $ | 8.03 | $ | 7.6 | |||||
As of March 31, 2015, there was approximately $7.8 million of total unrecognized compensation cost related to TSYS stock options that is expected to be recognized over a remaining weighted average period of 1.4 years. |
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2015 | |
Income Taxes | Note 7 — Income Taxes |
Refer to Notes 1 and 15 of the Company’s audited financial statements for the year ended December 31, 2014, which are included as Exhibit 13.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the SEC, for a discussion regarding income taxes. | |
TSYS is the parent of an affiliated group that files a consolidated U.S. federal income tax return and most state and foreign income tax returns on a separate entity basis. In the normal course of business, the Company is subject to examinations by these taxing authorities unless statutory examination periods lapse. TSYS is no longer subject to U.S. federal income tax examinations for years before 2011 and with few exceptions, the Company is no longer subject to income tax examinations from state and local or foreign tax authorities for years before 2008. There are currently federal income tax examinations in progress for the years 2009 through 2012 for a subsidiary which TSYS acquired in 2013. Additionally, a number of tax examinations are in progress by the relevant state tax authorities. Although TSYS is unable to determine the ultimate outcome of these examinations, TSYS believes that its liability for uncertain tax positions relating to these jurisdictions for such years is adequate. | |
TSYS’ effective tax rate was 34.0% and 32.1% for the three months ended March 31, 2015 and 2014, respectively. The increased rate during the three months ended March 31, 2015 was primarily due to changes in discrete items, tax credits and the jurisdictional sources of income. | |
GAAP prescribes a recognition threshold and measurement attribute for the financial statement recognition, measurement and disclosure of a tax position taken or expected to be taken in a tax return. The amount of unrecognized tax benefits did not change during the three months ended March 31, 2015. | |
TSYS recognizes potential interest and penalties related to the underpayment of income taxes as income tax expense in the consolidated statements of income. Gross accrued interest and penalties on unrecognized tax benefits totaled $0.4 million and $0.3 million as of March 31, 2015 and December 31, 2014, respectively. The total amounts of unrecognized income tax benefits as of March 31, 2015 and December 31, 2014, that, if recognized, would affect the effective tax rates are $6.6 million and $6.5 million (net of the federal benefit on state tax issues), respectively, which include interest and penalties of $0.2 million and $0.2 million, respectively. TSYS does not expect any material changes to its calculation of uncertain tax positions during the next twelve months. |
Segment_Reporting_and_Major_Cu
Segment Reporting and Major Customers | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||
Segment Reporting and Major Customers | Note 8 — Segment Reporting and Major Customers | ||||||||||||||||||||
Refer to Note 22 of the Company’s audited financial statements for the year ended December 31, 2014, which are included as Exhibit 13.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the SEC, for a discussion regarding segment reporting and major customers. | |||||||||||||||||||||
The following table presents the Company’s operating results by segment: | |||||||||||||||||||||
Operating Segments | |||||||||||||||||||||
Three months ended March 31, | |||||||||||||||||||||
(in thousands) | 2015 | 2014 | |||||||||||||||||||
Revenues before reimbursable items | |||||||||||||||||||||
North America Services | $ | 266,219 | 224,368 | ||||||||||||||||||
International Services | 73,730 | 76,773 | |||||||||||||||||||
Merchant Services | 110,398 | 104,625 | |||||||||||||||||||
NetSpend | 155,074 | 132,640 | |||||||||||||||||||
Intersegment revenues | (9,637 | ) | (5,656 | ) | |||||||||||||||||
Revenues before reimbursable items from external customers | $ | 595,784 | 532,750 | ||||||||||||||||||
Total revenues | |||||||||||||||||||||
North America Services | $ | 309,233 | 262,178 | ||||||||||||||||||
International Services | 79,802 | 82,378 | |||||||||||||||||||
Merchant Services | 129,104 | 122,690 | |||||||||||||||||||
NetSpend | 155,074 | 132,640 | |||||||||||||||||||
Intersegment revenues | (11,057 | ) | (7,038 | ) | |||||||||||||||||
Revenues from external customers | $ | 662,156 | 592,848 | ||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||
North America Services | $ | 23,064 | 20,276 | ||||||||||||||||||
International Services | 8,778 | 9,805 | |||||||||||||||||||
Merchant Services | 4,277 | 3,400 | |||||||||||||||||||
NetSpend | 2,293 | 1,735 | |||||||||||||||||||
Segment depreciation and amortization | 38,412 | 35,216 | |||||||||||||||||||
Acquisition intangible amortization | 23,867 | 24,313 | |||||||||||||||||||
Corporate Administration and Other | 536 | 506 | |||||||||||||||||||
Total depreciation and amortization | $ | 62,815 | 60,035 | ||||||||||||||||||
Adjusted segment operating income | |||||||||||||||||||||
North America Services | $ | 102,570 | 74,578 | ||||||||||||||||||
International Services | 6,983 | 4,555 | |||||||||||||||||||
Merchant Services | 34,115 | 30,168 | |||||||||||||||||||
NetSpend | 35,467 | 28,717 | |||||||||||||||||||
Total adjusted segment operating income | 179,135 | 138,018 | |||||||||||||||||||
Acquisition intangible amortization | (23,867 | ) | (24,313 | ) | |||||||||||||||||
NetSpend merger and acquisition operating expenses | — | (1,253 | ) | ||||||||||||||||||
Share-based compensation | (8,143 | ) | (7,611 | ) | |||||||||||||||||
Corporate Administration and Other | (24,629 | ) | (24,144 | ) | |||||||||||||||||
Operating income | $ | 122,496 | 80,697 | ||||||||||||||||||
As of | |||||||||||||||||||||
March 31, 2015 | December 31,2014 | ||||||||||||||||||||
Total assets | |||||||||||||||||||||
North America Services | $ | 3,373,386 | 3,327,160 | ||||||||||||||||||
International Services | 332,940 | 356,590 | |||||||||||||||||||
Merchant Services | 687,674 | 695,744 | |||||||||||||||||||
NetSpend | 1,561,386 | 1,556,369 | |||||||||||||||||||
Intersegment eliminations | (2,177,948 | ) | (2,202,282 | ) | |||||||||||||||||
Total assets | $ | 3,777,438 | 3,733,581 | ||||||||||||||||||
Revenues by Geographic Area | |||||||||||||||||||||
The following tables reconcile geographic revenues to external revenues by operating segment based on the domicile of the Company’s customers: | |||||||||||||||||||||
Three months ended March 31, 2015 | |||||||||||||||||||||
(in millions) | North America | International | Merchant | NetSpend | Total | ||||||||||||||||
Services | Services | Services | |||||||||||||||||||
United States | $ | 214 | — | 128.8 | 155.1 | $ | 497.9 | ||||||||||||||
Canada | 77.8 | — | 0.1 | — | 77.9 | ||||||||||||||||
Europe* | 0.2 | 67.6 | — | — | 67.8 | ||||||||||||||||
Mexico | 4.3 | — | — | — | 4.3 | ||||||||||||||||
Other* | 4.4 | 9.7 | 0.2 | — | 14.3 | ||||||||||||||||
Total | $ | 300.7 | 77.3 | 129.1 | 155.1 | $ | 662.2 | ||||||||||||||
Three months ended March 31, 2014 | |||||||||||||||||||||
(in millions) | North America | International | Merchant | NetSpend | Total | ||||||||||||||||
Services | Services | Services | |||||||||||||||||||
United States | $ | 185.3 | — | 122.5 | 132.6 | $ | 440.4 | ||||||||||||||
Canada | 62.9 | — | 0.1 | — | 63 | ||||||||||||||||
Europe* | 0.2 | 69.8 | — | — | 70 | ||||||||||||||||
Mexico | 3.9 | — | — | — | 3.9 | ||||||||||||||||
Other* | 3.8 | 11.5 | 0.2 | — | 15.5 | ||||||||||||||||
Total | $ | 256.1 | 81.3 | 122.8 | 132.6 | $ | 592.8 | ||||||||||||||
* | Revenues are impacted by movements in foreign currency exchange rates. | ||||||||||||||||||||
The Company maintains property and equipment, net of accumulated depreciation and amortization, in the following geographic areas: | |||||||||||||||||||||
As of | |||||||||||||||||||||
(in millions) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
United States | $ | 236.1 | 237.9 | ||||||||||||||||||
Europe* | 42.9 | 45.5 | |||||||||||||||||||
Other* | 6.4 | 7.2 | |||||||||||||||||||
Total | $ | 285.4 | 290.6 | ||||||||||||||||||
* | Property and equipment are impacted by movements in foreign currency exchange rates. | ||||||||||||||||||||
Major Customers | |||||||||||||||||||||
For the three months ended March 31, 2015 and 2014, the Company did not have any major customers. |
Supplementary_Cash_Flow_Inform
Supplementary Cash Flow Information | 3 Months Ended |
Mar. 31, 2015 | |
Supplementary Cash Flow Information | Note 9 — Supplementary Cash Flow Information |
Nonvested Awards | |
The Company issued shares of common stock to certain key employees during the first three months of 2015 and 2014, respectively. The grants were issued under nonvested stock bonus awards for services to be provided in the future. Refer to Note 6 for more information. | |
Equipment and Software Acquired Under Capital Lease Obligations | |
The Company acquired equipment and software under capital lease obligations in the amount of $0.7 million during the first three months of 2015 related to software and other peripheral hardware. The Company did not acquire any equipment or software under capital lease obligations during the first three months of 2014. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies | Note 10 — Commitments and Contingencies |
Refer to Note 16 of the Company’s audited financial statements for the year ended December 31, 2014, which are included as Exhibit 13.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the SEC, for a discussion regarding commitments and contingencies. | |
Income Taxes | |
The total liability for uncertain tax positions as of March 31, 2015 was $6.7 million. Refer to Note 7 for more information on income taxes. The Company is not able to reasonably estimate the amount by which the liability will increase or decrease over time; however, at this time, the Company does not expect a significant change related to these obligations within the next twelve months. | |
Legal Proceedings | |
General | |
The Company is subject to various legal proceedings and claims and is also subject to information requests, inquiries and investigations arising out of the ordinary conduct of its business. The Company establishes reserves for litigation and similar matters when those matters present loss contingencies that TSYS determines to be both probable and reasonably estimable in accordance with GAAP. In the opinion of management, based on current knowledge and in part upon the advice of legal counsel, all matters not specifically discussed below are believed to be adequately covered by insurance, or, if not covered, the possibility of losses from such matters are believed to be remote or such matters are of such kind or involve such amounts that would not have a material adverse effect on the financial position, results of operations or cash flows of the Company if disposed of unfavorably. | |
Telexfree Matter | |
ProPay, Inc. (“ProPay”), a subsidiary of the Company, has been named as one of a number of defendants (including other merchant processors) in several purported class action lawsuits relating to the activities of Telexfree, Inc. and its affiliates and principals. Telexfree is a former merchant customer of ProPay. With regard to Telexfree, each purported class action lawsuit generally alleges that Telexfree engaged in an improper multi-tier marketing scheme involving voice-over Internet protocol telephone services. The plaintiffs in each of the purported class action complaints generally allege that the various merchant processor defendants, including ProPay, knowingly furthered the improper activities of Telexfree with knowledge that Telexfree did not have legitimate business operations. Telexfree filed for bankruptcy protection in Nevada. The bankruptcy was subsequently transferred to the Massachusetts Bankruptcy Court. | |
Specifically, ProPay has been named as one of a number of defendants (including other merchant processors) in each of the following purported class action complaints relating to Telexfree: (i) Waldermara Martin, et al. v. TelexFree, Inc., et al. (Case No. BK-S-14-12524-ABL) filed on May 3, 2014 in the United States Bankruptcy Court District of Nevada, (ii) Anthony Cellucci, et al. v. TelexFree, Inc., et. al. (Case No. 4:14-BK-40987) filed on May 15, 2014 in the United States Bankruptcy Court District of Massachusetts, (iii) Maduako C. Ferguson Sr., et al. v. Telexelectric, LLLP, et. al (Case No. 5:14-CV-00316-D) filed on June 5, 2014 in the United States District Court of North Carolina, (iv) Todd Cook v. TelexElectric LLLP et al. (Case No. 2:14-CV-00134), filed on June 24, 2014 in the United States District Court for the Northern District of Georgia, (v) Felicia Guevara v. James M. Merrill et al., CA No. 1:14-cv-22405-DPG), filed on June 27, 2014 in the United State District Court for the Southern District of Florida, and (vi) Reverend Jeremiah Githere, et al. v. TelexElectric LLLP et al. (Case No. 1:14-CV-12825-GAO), filed on June 30, 2014 in the United States District Court for the District of Massachusetts (together, the “Actions”). A motion to consolidate the Actions was filed by one of the plaintiffs. On October 21, 2014, the Actions were transferred to and consolidated before the United States District Court for the District of Massachusetts. After the consolidation motion was filed, an additional class action complaint was filed on August 20, 2014, in the United States Bankruptcy Court for the District of Massachusetts, Paulo Eduardo Ferrari et al. v. Telexfree, Inc. et al. (Case No. 14-04080). The Ferrari action was later transferred to the District of Massachusetts. To date, ProPay has not been served with the Ferrari complaint. | |
The United States District Court for the District of Massachusetts appointed lead plaintiffs’ counsel on behalf of the putative class of plaintiffs in the consolidated action. On March 31, 2015, the plaintiffs filed a First Consolidated Amended Complaint (the “Consolidated Complaint”). The Consolidated Complaint purports to bring claims on behalf of all persons who purchased certain TelexFree “memberships” and suffered a “net loss” between January 1, 2012 and April 16, 2014. The Consolidated Complaint supersedes the complaints filed prior to consolidation of the Actions, and alleges that ProPay aided and abetted tortious acts committed by TelexFree, and that ProPay was unjustly enriched in the course of providing payment processing services to TelexFree. On April 30, 2015, the plaintiffs filed a Second Consolidated Amended Complaint (the “Second Amended Complaint”), which amends and supersedes the Consolidated Complaint. Like the Consolidated Complaint, the Second Amended Complaint generally alleges that ProPay aided and abetted tortious acts committed by TelexFree, and that ProPay was unjustly enriched in the course of providing payment processing services to TelexFree. ProPay has not yet responded to the Second Amended Complaint. | |
ProPay has also received various subpoenas, a seizure warrant and other inquiries requesting information regarding Telexfree from (i) the Commonwealth of Massachusetts, Securities Division, (ii) United States Securities and Exchange Commission, (iii) US Immigration aand Customs Enforcement, and (iv) the bankruptcy Trustee of the Chapter 11 entities of Telexfree, Inc., Telexfree, LLC and Telexfree Financial, Inc. Pursuant to the seizure warrant served by the United States Attorney’s Office for the District of Massachusetts, ProPay delivered all funds associated with Telexfree held for chargeback and other purposes by ProPay to US Immigration and Customs Enforcement. In addition, ProPay received a notice of potential claim from the bankruptcy Trustee as a result of the relationship of ProPay with Telexfree and its affiliates. | |
The above proceedings and actions are preliminary in nature. While the Company and ProPay intend to vigorously defend matters arising out of the relationship of ProPay with Telexfree and believe ProPay has substantial defenses related to these purported claims, the Company currently cannot reasonably estimate losses attributable to these matters. |
Earnings_Per_Share
Earnings Per Share | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Earnings Per Share | Note 11 – Earnings Per Share | ||||||||||||||||
The following table illustrates basic and diluted EPS for the three months ended March 31, 2015 and 2014: | |||||||||||||||||
Three months ended March 31, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
(in thousands, except per share data) | Common | Participating | Common | Participating | |||||||||||||
Stock | Securities | Stock | Securities | ||||||||||||||
Basic EPS: | |||||||||||||||||
Net income attributable to TSYS common shareholders | $ | 77,755 | 49,303 | ||||||||||||||
Less income allocated to nonvested awards | (712 | ) | 712 | (516 | ) | 516 | |||||||||||
Net income allocated to common stock for EPS calculation (a) | $ | 77,043 | 712 | 48,787 | 516 | ||||||||||||
Average common shares outstanding (b) | 182,772 | 1,709 | 185,763 | 1,989 | |||||||||||||
Basic EPS (a)/(b) | $ | 0.42 | 0.42 | 0.26 | 0.26 | ||||||||||||
Diluted EPS: | |||||||||||||||||
Net income attributable to TSYS common shareholders | $ | 77,755 | 49,303 | ||||||||||||||
Less income allocated to nonvested awards | (709 | ) | 709 | (512 | ) | 512 | |||||||||||
Net income allocated to common stock for EPS calculation (c) | $ | 77,046 | 709 | 48,791 | 512 | ||||||||||||
Average common shares outstanding | 182,772 | 1,709 | 185,763 | 1,989 | |||||||||||||
Increase due to assumed issuance of shares related to common equivalent shares outstanding | 1,082 | 2,632 | |||||||||||||||
Average common and common equivalent shares outstanding (d) | 183,854 | 1,709 | 188,395 | 1,989 | |||||||||||||
Diluted EPS (c)/(d) | $ | 0.42 | 0.42 | 0.26 | 0.26 | ||||||||||||
The diluted EPS calculation excludes stock options and nonvested awards that are convertible into 0.9 million common shares for the three months ended March 31, 2015, and excludes 4.5 million common shares for the three months ended March 31, 2014, respectively, because their inclusion would have been anti-dilutive. |
Subsequent_Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2015 | |
Subsequent Events | Note 12 — Subsequent Events |
Management performed an evaluation of the Company’s activity and has concluded that there are no significant subsequent events requiring disclosure. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Basis of Presentation | Basis of Presentation |
The accompanying unaudited consolidated financial statements of TSYS include the accounts of TSYS and its wholly- and majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. | |
These financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and, therefore, do not include all information and footnotes required by U.S. GAAP for complete financial statements. The preparation of the consolidated financial statements requires management of the Company to make estimates and assumptions relating to the reported amounts of assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. These estimates and assumptions are developed based upon all information available. Actual results could differ from estimated amounts. All adjustments, consisting of normal recurring accruals, which, in the opinion of management, are necessary for a fair presentation of financial position and results of operations for the periods covered by this report, have been included. | |
Certain prior period amounts may have been reclassified to conform to the current period’s presentation. | |
As discussed in Note 2, the Company’s financial statements reflect GP Network Corporation (GP Net) and TSYS Japan Godo Kaisha (TSYS Japan), formerly TSYS Japan Co., Ltd., as discontinued operations. The Company has segregated the net assets, net liabilities and operating results from continuing operations on the Unaudited Consolidated Balance Sheets and Unaudited Consolidated Statements of Income for all periods presented. | |
The accompanying unaudited consolidated financial statements should be read in conjunction with the Company’s summary of significant accounting policies, consolidated financial statements and related notes appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, as filed with the Securities and Exchange Commission (SEC). Results of interim periods are not necessarily indicative of results to be expected for the year. | |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements |
In January 2015, the Company adopted Accounting Standards Update (ASU) 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” The amendments in this Update change the criteria for reporting discontinued operations and enhancing convergence of the Financial Accounting Standards Board’s (FASB) and the International Accounting Standard Board’s (IASB) reporting requirements for discontinued operations. The adoption of this ASU did not have a material impact on the Company’s financial position, results of operations or cash flows. | |
New Accounting Pronouncements | New Accounting Pronouncements |
In April 2015, the FASB issued ASU 2015-05 “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement.” The amendments in this Update provide guidance to customers about whether a cloud computing arrangement includes a software license or a service agreement. The Company does not expect the adoption of this ASU to have a material impact on the Company’s financial position, results of operations or cash flows. | |
In April 2015, the FASB issued ASU 2015-03 “Interest — Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Cost.” The amendments in this update will require entities to present debt issuance costs in the balance sheet as a direct deduction from the carrying amount of the corresponding debt liability, consistent with debt discounts. The guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The guidance will be applied retrospectively. The Company does not expect the adoption of this guidance to have a material impact on the Company’s financial position, results of operations or cash flows. | |
In January 2015, the FASB issued ASU 2015-01 “Income Statement – Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.” ASU 2015-01 eliminates from GAAP the concept of extraordinary items. For all entities, the ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted provided the guidance is applied from the beginning of the fiscal year of adoption. The Company does not expect the adoption of this ASU to have a material impact on the financial position, results of operations or cash flows of the Company. | |
In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers”, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company on January 1, 2017. Early application is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect on its ongoing financial reporting. |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Financial Results for Discontinued Operations | The following table presents the main classes of assets and liabilities associated with discontinued operations as of March 31, 2015 and December 31, 2014: | ||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||
Other assets | $ | 4,003 | 4,003 | ||||||
Total liabilities | 4,003 | 4,003 | |||||||
The following table presents the summarized results of discontinued operations for the three months ended March 31, 2014: | |||||||||
(in thousands) | Three months ended | ||||||||
March 31, 2014 | |||||||||
Total revenues | $ | 16,248 | |||||||
Revenues before reimbursable items | $ | 16,248 | |||||||
Operating income | $ | 367 | |||||||
Income tax benefit | $ | (44 | ) | ||||||
Income from discontinued operations, net of tax | $ | 980 | |||||||
Income from discontinued operations, net of tax, attributable to noncontrolling interest | $ | 998 | |||||||
Loss from discontinued operations, net of tax, attributable to TSYS common shareholders | $ | (18 | ) | ||||||
Supplementary_Balance_Sheet_In1
Supplementary Balance Sheet Information (Tables) | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||
Cash and Cash Equivalent Balances | Cash and cash equivalent balances are summarized as follows: | ||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Cash and cash equivalents in domestic accounts | $ | 275,583 | 225,396 | ||||||||||||||||||
Cash and cash equivalents in foreign accounts | 52,529 | 63,787 | |||||||||||||||||||
Total | $ | 328,112 | 289,183 | ||||||||||||||||||
Significant Components of Prepaid Expenses and Other Current Assets | Significant components of prepaid expenses and other current assets are summarized as follows: | ||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Prepaid expenses | $ | 34,716 | 35,334 | ||||||||||||||||||
Supplies inventory | 12,964 | 14,340 | |||||||||||||||||||
Other | 52,440 | 49,300 | |||||||||||||||||||
Total | $ | 100,120 | 98,974 | ||||||||||||||||||
Significant Components of Contract Acquisition Costs, Net of Accumulated Amortization | Significant components of contract acquisition costs, net of accumulated amortization, are summarized as follows: | ||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Conversion costs, net of accumulated amortization of $140.8 million and $138.7 million as of 2015 and 2014, respectively | $ | 163,845 | 159,339 | ||||||||||||||||||
Payments for processing rights, net of accumulated amortization of $138.7 million and $137.4 million as of 2015 and 2014, respectively | 72,382 | 76,966 | |||||||||||||||||||
Total | $ | 236,227 | 236,305 | ||||||||||||||||||
Significant Components of Other Current Liabilities | Significant components of other current liabilities are summarized as follows: | ||||||||||||||||||||
(in thousands) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
Deferred revenues | $ | 43,317 | 41,773 | ||||||||||||||||||
Accrued income taxes | 34,648 | — | |||||||||||||||||||
Accrued expenses | 25,973 | 23,617 | |||||||||||||||||||
Dividends payable | 19,094 | 19,006 | |||||||||||||||||||
Other | 87,469 | 70,409 | |||||||||||||||||||
Total | $ | 210,501 | 154,805 | ||||||||||||||||||
Income Tax Effects Allocated to and Cumulative Balance of Accumulated Other Comprehensive Income (Loss) | The income tax effects allocated to and the cumulative balance of accumulated other comprehensive income (loss) attributable to TSYS shareholders are as follows: | ||||||||||||||||||||
(in thousands) | Beginning | Pretax | Tax | Net-of-Tax | Ending | ||||||||||||||||
Balance | Amount | Effect | Amount | Balance | |||||||||||||||||
December 31, | March 31, | ||||||||||||||||||||
2014 | 2015 | ||||||||||||||||||||
Foreign currency translation adjustments and transfers from noncontrolling interests | $ | (13,564 | ) | (14,393 | ) | (1,306 | ) | (13,087 | ) | $ | (26,651 | ) | |||||||||
Unrealized gain on available-for-sale securities | 1,105 | 938 | 346 | 592 | 1,697 | ||||||||||||||||
Change in AOCI related to postretirement healthcare plans | 533 | 230 | 83 | 147 | 680 | ||||||||||||||||
Total | $ | (11,926 | ) | (13,225 | ) | (877 | ) | (12,348 | ) | $ | (24,274 | ) | |||||||||
ShareBased_Compensation_Tables
Share-Based Compensation (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Nonvested Share Awards | The market value of the TSYS common stock as of the date of issuance is charged as compensation expense over the vesting periods of the awards. | ||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Number of shares | 345,038 | 596,113 | |||||||
Market value (in millions) | $ | 13 | $ | 18.2 | |||||
Weighted Average Fair Value Of Option Grants | The weighted average fair value of the option grants was estimated on the date of grant using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions: | ||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Number of options granted | 487,735 | 914,470 | |||||||
Weighted average exercise price | $ | 38.2 | $ | 30.83 | |||||
Risk-free interest rate | 1.7 | % | 2 | % | |||||
Expected volatility | 21 | % | 25 | % | |||||
Expected term (years) | 6.3 | 6.5 | |||||||
Dividend yield | 1.05 | % | 1.3 | % | |||||
Weighted average fair value | $ | 8.03 | $ | 7.6 |
Segment_Reporting_and_Major_Cu1
Segment Reporting and Major Customers (Tables) | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||
Operating Segments | The following table presents the Company’s operating results by segment: | ||||||||||||||||||||
Operating Segments | |||||||||||||||||||||
Three months ended March 31, | |||||||||||||||||||||
(in thousands) | 2015 | 2014 | |||||||||||||||||||
Revenues before reimbursable items | |||||||||||||||||||||
North America Services | $ | 266,219 | 224,368 | ||||||||||||||||||
International Services | 73,730 | 76,773 | |||||||||||||||||||
Merchant Services | 110,398 | 104,625 | |||||||||||||||||||
NetSpend | 155,074 | 132,640 | |||||||||||||||||||
Intersegment revenues | (9,637 | ) | (5,656 | ) | |||||||||||||||||
Revenues before reimbursable items from external customers | $ | 595,784 | 532,750 | ||||||||||||||||||
Total revenues | |||||||||||||||||||||
North America Services | $ | 309,233 | 262,178 | ||||||||||||||||||
International Services | 79,802 | 82,378 | |||||||||||||||||||
Merchant Services | 129,104 | 122,690 | |||||||||||||||||||
NetSpend | 155,074 | 132,640 | |||||||||||||||||||
Intersegment revenues | (11,057 | ) | (7,038 | ) | |||||||||||||||||
Revenues from external customers | $ | 662,156 | 592,848 | ||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||
North America Services | $ | 23,064 | 20,276 | ||||||||||||||||||
International Services | 8,778 | 9,805 | |||||||||||||||||||
Merchant Services | 4,277 | 3,400 | |||||||||||||||||||
NetSpend | 2,293 | 1,735 | |||||||||||||||||||
Segment depreciation and amortization | 38,412 | 35,216 | |||||||||||||||||||
Acquisition intangible amortization | 23,867 | 24,313 | |||||||||||||||||||
Corporate Administration and Other | 536 | 506 | |||||||||||||||||||
Total depreciation and amortization | $ | 62,815 | 60,035 | ||||||||||||||||||
Adjusted segment operating income | |||||||||||||||||||||
North America Services | $ | 102,570 | 74,578 | ||||||||||||||||||
International Services | 6,983 | 4,555 | |||||||||||||||||||
Merchant Services | 34,115 | 30,168 | |||||||||||||||||||
NetSpend | 35,467 | 28,717 | |||||||||||||||||||
Total adjusted segment operating income | 179,135 | 138,018 | |||||||||||||||||||
Acquisition intangible amortization | (23,867 | ) | (24,313 | ) | |||||||||||||||||
NetSpend merger and acquisition operating expenses | — | (1,253 | ) | ||||||||||||||||||
Share-based compensation | (8,143 | ) | (7,611 | ) | |||||||||||||||||
Corporate Administration and Other | (24,629 | ) | (24,144 | ) | |||||||||||||||||
Operating income | $ | 122,496 | 80,697 | ||||||||||||||||||
As of | |||||||||||||||||||||
March 31, 2015 | December 31,2014 | ||||||||||||||||||||
Total assets | |||||||||||||||||||||
North America Services | $ | 3,373,386 | 3,327,160 | ||||||||||||||||||
International Services | 332,940 | 356,590 | |||||||||||||||||||
Merchant Services | 687,674 | 695,744 | |||||||||||||||||||
NetSpend | 1,561,386 | 1,556,369 | |||||||||||||||||||
Intersegment eliminations | (2,177,948 | ) | (2,202,282 | ) | |||||||||||||||||
Total assets | $ | 3,777,438 | 3,733,581 | ||||||||||||||||||
Reconciliation of Geographic Revenues to External Revenues by Operating Segments | The following tables reconcile geographic revenues to external revenues by operating segment based on the domicile of the Company’s customers: | ||||||||||||||||||||
Three months ended March 31, 2015 | |||||||||||||||||||||
(in millions) | North America | International | Merchant | NetSpend | Total | ||||||||||||||||
Services | Services | Services | |||||||||||||||||||
United States | $ | 214 | — | 128.8 | 155.1 | $ | 497.9 | ||||||||||||||
Canada | 77.8 | — | 0.1 | — | 77.9 | ||||||||||||||||
Europe* | 0.2 | 67.6 | — | — | 67.8 | ||||||||||||||||
Mexico | 4.3 | — | — | — | 4.3 | ||||||||||||||||
Other* | 4.4 | 9.7 | 0.2 | — | 14.3 | ||||||||||||||||
Total | $ | 300.7 | 77.3 | 129.1 | 155.1 | $ | 662.2 | ||||||||||||||
Three months ended March 31, 2014 | |||||||||||||||||||||
(in millions) | North America | International | Merchant | NetSpend | Total | ||||||||||||||||
Services | Services | Services | |||||||||||||||||||
United States | $ | 185.3 | — | 122.5 | 132.6 | $ | 440.4 | ||||||||||||||
Canada | 62.9 | — | 0.1 | — | 63 | ||||||||||||||||
Europe* | 0.2 | 69.8 | — | — | 70 | ||||||||||||||||
Mexico | 3.9 | — | — | — | 3.9 | ||||||||||||||||
Other* | 3.8 | 11.5 | 0.2 | — | 15.5 | ||||||||||||||||
Total | $ | 256.1 | 81.3 | 122.8 | 132.6 | $ | 592.8 | ||||||||||||||
* | Revenues are impacted by movements in foreign currency exchange rates. | ||||||||||||||||||||
Property and Equipment, Net of Accumulated Depreciation and Amortization | The Company maintains property and equipment, net of accumulated depreciation and amortization, in the following geographic areas: | ||||||||||||||||||||
As of | |||||||||||||||||||||
(in millions) | March 31, 2015 | December 31, 2014 | |||||||||||||||||||
United States | $ | 236.1 | 237.9 | ||||||||||||||||||
Europe* | 42.9 | 45.5 | |||||||||||||||||||
Other* | 6.4 | 7.2 | |||||||||||||||||||
Total | $ | 285.4 | 290.6 | ||||||||||||||||||
* | Property and equipment are impacted by movements in foreign currency exchange rates. |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Basic and Diluted Earnings Per Share | The following table illustrates basic and diluted EPS for the three months ended March 31, 2015 and 2014: | ||||||||||||||||
Three months ended March 31, | |||||||||||||||||
2015 | 2014 | ||||||||||||||||
(in thousands, except per share data) | Common | Participating | Common | Participating | |||||||||||||
Stock | Securities | Stock | Securities | ||||||||||||||
Basic EPS: | |||||||||||||||||
Net income attributable to TSYS common shareholders | $ | 77,755 | 49,303 | ||||||||||||||
Less income allocated to nonvested awards | (712 | ) | 712 | (516 | ) | 516 | |||||||||||
Net income allocated to common stock for EPS calculation (a) | $ | 77,043 | 712 | 48,787 | 516 | ||||||||||||
Average common shares outstanding (b) | 182,772 | 1,709 | 185,763 | 1,989 | |||||||||||||
Basic EPS (a)/(b) | $ | 0.42 | 0.42 | 0.26 | 0.26 | ||||||||||||
Diluted EPS: | |||||||||||||||||
Net income attributable to TSYS common shareholders | $ | 77,755 | 49,303 | ||||||||||||||
Less income allocated to nonvested awards | (709 | ) | 709 | (512 | ) | 512 | |||||||||||
Net income allocated to common stock for EPS calculation (c) | $ | 77,046 | 709 | 48,791 | 512 | ||||||||||||
Average common shares outstanding | 182,772 | 1,709 | 185,763 | 1,989 | |||||||||||||
Increase due to assumed issuance of shares related to common equivalent shares outstanding | 1,082 | 2,632 | |||||||||||||||
Average common and common equivalent shares outstanding (d) | 183,854 | 1,709 | 188,395 | 1,989 | |||||||||||||
Diluted EPS (c)/(d) | $ | 0.42 | 0.42 | 0.26 | 0.26 | ||||||||||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies - Additional Information (Detail) (NetSpend Holdings Inc) | 3 Months Ended |
Mar. 31, 2015 | |
Segment | |
NetSpend Holdings Inc | |
Significant Accounting Policies [Line Items] | |
Operating segments | 4 |
Discontinued_Operations_Additi
Discontinued Operations - Additional Information (Detail) | 1 Months Ended |
Apr. 30, 2014 | |
GP Net | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Sale of stock, ownership percentage | 54.00% |
TSYS Japan | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Sale of stock, ownership percentage | 100.00% |
Main_Classes_of_Assets_and_Lia
Main Classes of Assets and Liabilities Held for Sale (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Other assets | $4,003 | $4,003 |
Total liabilities | $4,003 | $4,003 |
Summarized_Results_of_Disconti
Summarized Results of Discontinued Operations (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Total revenues | $16,248 |
Revenues before reimbursable items | 16,248 |
Operating income | 367 |
Income tax benefit | -44 |
Income from discontinued operations, net of tax | 980 |
Income from discontinued operations, net of tax, attributable to noncontrolling interest | 998 |
Loss from discontinued operations, net of tax, attributable to TSYS common shareholders | ($18) |
Cash_and_Cash_Equivalent_Balan
Cash and Cash Equivalent Balances (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | |||
Cash and Cash Equivalents [Line Items] | |||
Cash and cash equivalents in domestic accounts | $275,583 | $225,396 | |
Cash and cash equivalents in foreign accounts | 52,529 | 63,787 | |
Cash and cash equivalents of continued operations at end of period | $328,112 | $289,183 | $274,161 |
Significant_Components_of_Prep
Significant Components of Prepaid Expenses and Other Current Assets (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Line Items] | ||
Prepaid expenses | $34,716 | $35,334 |
Supplies inventory | 12,964 | 14,340 |
Other | 52,440 | 49,300 |
Total | $100,120 | $98,974 |
Significant_Components_of_Cont
Significant Components of Contract Acquisition Costs (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Conversion costs, net of accumulated amortization of $140.8 million and $138.7 million as of 2015 and 2014, respectively | $163,845 | $159,339 |
Payments for processing rights, net of accumulated amortization of $138.7 million and $137.4 million as of 2015 and 2014, respectively | 72,382 | 76,966 |
Total | $236,227 | $236,305 |
Significant_Components_of_Cont1
Significant Components of Contract Acquisition Costs (Parenthetical) (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Conversion costs, accumulated amortization | $140.80 | $138.70 |
Payments for processing rights, accumulated amortization | $138.70 | $137.40 |
Supplementary_Balance_Sheet_In2
Supplementary Balance Sheet Information - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Line Items] | ||
Amortization expense related to conversion costs | $5.50 | $4.30 |
Amortization related to payments for processing rights | 4.1 | 3.3 |
Reclassifications of AOCI | $0 |
Significant_Components_of_Othe
Significant Components of Other Current Liabilities (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Other Liabilities [Line Items] | ||
Deferred revenues | $43,317 | $41,773 |
Accrued income taxes | 34,648 | |
Accrued expenses | 25,973 | 23,617 |
Dividends payable | 19,094 | 19,006 |
Other | 87,469 | 70,409 |
Total | $210,501 | $154,805 |
Income_Tax_Effects_Allocated_t
Income Tax Effects Allocated to and Cumulative Balance of Accumulated Other Comprehensive Income (loss) (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning Balance | ($11,926) |
Pretax Amount | -13,225 |
Tax Effect | -877 |
Net-of-Tax Amount | -12,348 |
Ending Balance | -24,274 |
Foreign currency translation adjustments and transfers from NCI | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning Balance | -13,564 |
Pretax Amount | -14,393 |
Tax Effect | -1,306 |
Net-of-Tax Amount | -13,087 |
Ending Balance | -26,651 |
Unrealized gain on available-for-sale securities | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning Balance | 1,105 |
Pretax Amount | 938 |
Tax Effect | 346 |
Net-of-Tax Amount | 592 |
Ending Balance | 1,697 |
Change in Accumulated OCI Related to post retirement healthcare plans | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning Balance | 533 |
Pretax Amount | 230 |
Tax Effect | 83 |
Net-of-Tax Amount | 147 |
Ending Balance | $680 |
ShareBased_Compensation_Additi
Share-Based Compensation - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation | $8,143,000 | $7,611,000 |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost related to non vested share-based compensation arrangements | 7,800,000 | |
Unrecognized compensation cost related to non vested share-based compensation arrangements, remaining weighted average recognition period | 1 year 4 months 24 days | |
Stock Options | Maximum | Certain key Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 3 years | |
Unvested Restricted Awards | Maximum | Certain key Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 4 years | |
Performance And Market Based Share Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Authorized shares of nonvested stock to key executives | 182,906 | |
2014 Performance Shares | Performance Shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Authorized shares of nonvested stock to key executives | 201,189 | |
Percentage of performance shares grant expected to vest | 200.00% | |
2014 Performance Shares | Performance Shares | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Performance shares grant expected vesting period | 2014 | |
2014 Performance Shares | Performance Shares | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Performance shares grant expected vesting period | 2016 | |
2015 Performance Share Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost related to non vested share-based compensation arrangements | 13,900,000 | |
2015 Performance Share Plan | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost related to non vested share-based compensation arrangements, remaining weighted average recognition period | 2017 | |
2015 Performance Share Plan | Performance Shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Authorized shares of nonvested stock to key executives | 128,034 | |
Percentage of performance shares grant expected to vest | 200.00% | |
2015 Performance Share Plan | Performance Shares | Certain key Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Authorized shares of nonvested stock to key executives | 165,543 | |
2015 Performance Share Plan | Performance Shares | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Performance shares grant expected vesting period | 2015 | |
2015 Performance Share Plan | Performance Shares | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Performance shares grant expected vesting period | 2017 | |
2015 Market-Based Share Plan | Market Based Share Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Authorized shares of nonvested stock to key executives | 54,872 | |
Percentage of performance shares grant expected to vest | 200.00% | |
Unrecognized compensation cost related to non vested share-based compensation arrangements | $1,800,000 | |
Unrecognized compensation cost related to non vested share-based compensation arrangements, remaining weighted average recognition period | 1 year 9 months 18 days | |
2015 Market-Based Share Plan | Market Based Share Awards | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Performance shares grant expected vesting period | 2015 | |
2015 Market-Based Share Plan | Market Based Share Awards | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Performance shares grant expected vesting period | 2017 |
Nonvested_Share_Awards_Detail
Nonvested Share Awards (Detail) (Unvested Restricted Awards, Certain key Employees, USD $) | 3 Months Ended | |
In Millions, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Unvested Restricted Awards | Certain key Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares | 345,038 | 596,113 |
Value of awards issued | $13 | $18.20 |
Weighted_Average_Fair_Value_Of
Weighted Average Fair Value Of Option Grants (Detail) (Stock Options, USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options granted | 487,735 | 914,470 |
Weighted average exercise price | $38.20 | $30.83 |
Risk-free interest rate | 1.70% | 2.00% |
Expected volatility | 21.00% | 25.00% |
Expected term (years) | 6 years 3 months 18 days | 6 years 6 months |
Dividend yield | 1.05% | 1.30% |
Weighted average fair value | $8.03 | $7.60 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Income Tax Contingency [Line Items] | |||
Effective tax rate attributable to continuing operations | 34.00% | 32.10% | |
unrecognized tax benefits | $0 | ||
Gross accrued interest and penalties on unrecognized tax benefits | 0.4 | 0.3 | |
Unrecognized income tax benefits that, if recognized, would affect the effective tax rates | 6.6 | 6.5 | |
Unrecognized income tax benefits that, if recognized, would affect the effective tax rates , interest and penalties | $0.20 | $0.20 |
Operating_Segments_Detail
Operating Segments (Detail) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Segment Reporting Information [Line Items] | |||
Revenues before reimbursable items | $595,784 | $532,750 | |
Revenue for reportable segment | 662,156 | 592,848 | |
Depreciation and amortization | 62,815 | 60,035 | |
Operating income | 122,496 | 80,697 | |
Total assets | 3,777,438 | 3,733,581 | |
North America Services | |||
Segment Reporting Information [Line Items] | |||
Revenue for reportable segment | 300,700 | 256,100 | |
International Services | |||
Segment Reporting Information [Line Items] | |||
Revenue for reportable segment | 77,300 | 81,300 | |
Merchant Services | |||
Segment Reporting Information [Line Items] | |||
Revenue for reportable segment | 129,100 | 122,800 | |
NetSpend | |||
Segment Reporting Information [Line Items] | |||
Revenue for reportable segment | 155,100 | 132,600 | |
Share Based Compensation | |||
Segment Reporting Information [Line Items] | |||
Operating income | -8,143 | -7,611 | |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 38,412 | 35,216 | |
Operating income | 179,135 | 138,018 | |
Operating Segments | North America Services | |||
Segment Reporting Information [Line Items] | |||
Revenues before reimbursable items | 266,219 | 224,368 | |
Revenue for reportable segment | 309,233 | 262,178 | |
Depreciation and amortization | 23,064 | 20,276 | |
Operating income | 102,570 | 74,578 | |
Total assets | 3,373,386 | 3,327,160 | |
Operating Segments | International Services | |||
Segment Reporting Information [Line Items] | |||
Revenues before reimbursable items | 73,730 | 76,773 | |
Revenue for reportable segment | 79,802 | 82,378 | |
Depreciation and amortization | 8,778 | 9,805 | |
Operating income | 6,983 | 4,555 | |
Total assets | 332,940 | 356,590 | |
Operating Segments | Merchant Services | |||
Segment Reporting Information [Line Items] | |||
Revenues before reimbursable items | 110,398 | 104,625 | |
Revenue for reportable segment | 129,104 | 122,690 | |
Depreciation and amortization | 4,277 | 3,400 | |
Operating income | 34,115 | 30,168 | |
Total assets | 687,674 | 695,744 | |
Operating Segments | NetSpend | |||
Segment Reporting Information [Line Items] | |||
Revenues before reimbursable items | 155,074 | 132,640 | |
Revenue for reportable segment | 155,074 | 132,640 | |
Depreciation and amortization | 2,293 | 1,735 | |
Operating income | 35,467 | 28,717 | |
Total assets | 1,561,386 | 1,556,369 | |
Intersegment Elimination | |||
Segment Reporting Information [Line Items] | |||
Revenues before reimbursable items | -9,637 | -5,656 | |
Revenue for reportable segment | -11,057 | -7,038 | |
Total assets | -2,177,948 | -2,202,282 | |
Segment Reconciling Items | Acquisition Related Intangible Assets | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 23,867 | 24,313 | |
Operating income | -23,867 | -24,313 | |
Corporate, Non-Segment | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 536 | 506 | |
Corporate, Non-Segment | NetSpend | |||
Segment Reporting Information [Line Items] | |||
Operating income | -1,253 | ||
Corporate, Non-Segment | Corporate Administration | |||
Segment Reporting Information [Line Items] | |||
Operating income | ($24,629) | ($24,144) |
Reconciliation_of_Geographic_R
Reconciliation of Geographic Revenues to External Revenues by Operating Segments (Detail) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | ||
Segment Reporting Information [Line Items] | ||||
Total revenues | $662,156 | $592,848 | ||
United States | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 497,900 | 440,400 | ||
Canada | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 77,900 | 63,000 | ||
Europe | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 67,800 | [1] | 70,000 | [1] |
Mexico | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 4,300 | 3,900 | ||
Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 14,300 | [1] | 15,500 | [1] |
North America Services | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 300,700 | 256,100 | ||
North America Services | United States | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 214,000 | 185,300 | ||
North America Services | Canada | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 77,800 | 62,900 | ||
North America Services | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 200 | [1] | 200 | [1] |
North America Services | Mexico | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 4,300 | 3,900 | ||
North America Services | Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 4,400 | [1] | 3,800 | [1] |
International Services | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 77,300 | 81,300 | ||
International Services | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 67,600 | [1] | 69,800 | [1] |
International Services | Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 9,700 | [1] | 11,500 | [1] |
Merchant Services | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 129,100 | 122,800 | ||
Merchant Services | United States | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 128,800 | 122,500 | ||
Merchant Services | Canada | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 100 | 100 | ||
Merchant Services | Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 200 | [1] | 200 | [1] |
NetSpend | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 155,100 | 132,600 | ||
NetSpend | United States | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $155,100 | $132,600 | ||
[1] | Revenues are impacted by movements in foreign currency exchange rates. |
Property_and_Equipment_Net_of_
Property and Equipment, Net of Accumulated Depreciation and Amortization (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | ||
In Thousands, unless otherwise specified | ||||
Segment Reporting Information [Line Items] | ||||
Property and equipment, net of accumulated depreciation and amortization | $285,413 | $290,585 | ||
United States | ||||
Segment Reporting Information [Line Items] | ||||
Property and equipment, net of accumulated depreciation and amortization | 236,100 | 237,900 | ||
Europe | ||||
Segment Reporting Information [Line Items] | ||||
Property and equipment, net of accumulated depreciation and amortization | 42,900 | [1] | 45,500 | [1] |
Other | ||||
Segment Reporting Information [Line Items] | ||||
Property and equipment, net of accumulated depreciation and amortization | $6,400 | [1] | $7,200 | [1] |
[1] | Property and equipment are impacted by movements in foreign currency exchange rates. |
Segment_Reporting_and_Major_Cu2
Segment Reporting and Major Customers - Additional Information (Detail) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Customer | Customer | |
Segment Reporting Information [Line Items] | ||
Entity-wide revenue, major customer, number | 0 | 0 |
Supplementary_Cash_Flow_Inform1
Supplementary Cash Flow Information - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Schedule of Cash Flow, Supplemental [Line Items] | ||
Equipment and software acquired under capital lease obligations | $700,000 | $0 |
Commitments_And_Contingencies_
Commitments And Contingencies - Additional Information (Detail) (USD $) | Mar. 31, 2015 |
In Millions, unless otherwise specified | |
Commitment And Contingencies [Line Items] | |
Liability for uncertain tax positions | $6.70 |
Basic_and_Diluted_Earnings_Per
Basic and Diluted Earnings Per Share Under Guidance of ASC 260 (Detail) (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | ||
Basic EPS: | ||||
Net income attributable to TSYS common shareholders | $77,755 | $49,303 | ||
Basic EPS (a)/(b) | $0.42 | [1] | $0.26 | [1] |
Diluted EPS: | ||||
Net income attributable to TSYS common shareholders | 77,755 | 49,303 | ||
Diluted EPS (c)/(d) | $0.42 | [1] | $0.26 | [1] |
Common Stock | ||||
Basic EPS: | ||||
Net income attributable to TSYS common shareholders | 77,755 | 49,303 | ||
Less income allocated to nonvested awards | -712 | -516 | ||
Net income allocated to common stock for EPS calculation (a) | 77,043 | 48,787 | ||
Average common shares outstanding (b) | 182,772 | 185,763 | ||
Basic EPS (a)/(b) | $0.42 | $0.26 | ||
Diluted EPS: | ||||
Net income attributable to TSYS common shareholders | 77,755 | 49,303 | ||
Less income allocated to nonvested awards | -709 | -512 | ||
Net income allocated to common stock for EPS calculation (c) | 77,046 | 48,791 | ||
Average common shares outstanding | 182,772 | 185,763 | ||
Increase due to assumed issuance of shares related to common equivalent shares outstanding | 1,082 | 2,632 | ||
Average common and common equivalent shares outstanding (d) | 183,854 | 188,395 | ||
Diluted EPS (c)/(d) | $0.42 | $0.26 | ||
Participating Securities | ||||
Basic EPS: | ||||
Less income allocated to nonvested awards | 712 | 516 | ||
Net income allocated to common stock for EPS calculation (a) | 712 | 516 | ||
Average common shares outstanding (b) | 1,709 | 1,989 | ||
Basic EPS (a)/(b) | $0.42 | $0.26 | ||
Diluted EPS: | ||||
Less income allocated to nonvested awards | 709 | 512 | ||
Net income allocated to common stock for EPS calculation (c) | $709 | $512 | ||
Average common shares outstanding | 1,709 | 1,989 | ||
Average common and common equivalent shares outstanding (d) | 1,709 | 1,989 | ||
Diluted EPS (c)/(d) | $0.42 | $0.26 | ||
[1] | EPS amounts may not total due to rounding |
Earnings_Per_Share_Additional_
Earnings Per Share - Additional Information (Detail) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Computation of Earnings Per Share [Line Items] | ||
Convertible stock options and nonvested awards excluded from diluted EPS calculation | 0.9 | 4.5 |