Total System Services' 2Q Results: Postgame Scorecard


With an increase in profit, Total System Services (NYSE:TSS) beat analysts' expectations in the second quarter.

Earnings and Revenue The company's EPS outpaced analyst estimates while the company's revenues came in line with predictions. The company reported EPS of 35 cents a share versus the 32 cents a share estimate and revenues of $462.7 million versus the $461.7 million estimate. The company's reported EPS came in above the high estimate of 18 analysts of a profit of 33 cents.

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The company's net income for the quarter was $66.7 million. This is 24.1% higher than the year-ago quarter. Revenue climbed 3.4% from $447.6 million in the same period last year.

Company Fundamental Trends Last quarter marked the third in a row of rising net income. The company's revenue has grown during at least each of the past four quarters on a year-over-year basis.

History Against Expectations The company topped estimates last quarter after falling in line with expectations in the first quarter. It reported net income of 30 cents per share.

Official Comment: "Our second quarter results continued to benefit from increases in the number of transactions processed in our issuer processing and indirect merchant acquiring businesses, increases in the dollar volume of transactions in our direct merchant acquiring business, our ongoing management focus on cost controls, and an expected nonrecurring tax benefit. Same client transaction growth in our card issuer processing business increased 12.7%. POS transactions, excluding deconverted clients in our indirect merchant acquiring business, were up 12.4% and sales volume in our direct merchant business was up 9.7%," said Philip W. Tomlinson, chairman and chief executive officer of TSYS. "Our recently announced renewal and expansion of our relationship with Bank of America was a defining accomplishment for TSYS as we have yet again demonstrated that we can deliver for one of the top credit card issuers in the world. The Bank of America signing, when coupled with the signing of a 12-year contract extension with Royal Bank of Scotland confirms my confidence in our outstanding management team and team members to get the job done," said Tomlinson.

Estimates provided by Zacks Investment Research and company fundamentals from Xignite Financials.