TSYS® Reports 58.2% Increase in Net Income for Second Quarter 1999
Columbus, Ga., July 8, 1999 -- Total System Services, Inc.® (TSYS®) (NYSE: "TSS") today announced record revenues and net income for the second quarter and six months ended June 30, 1999.
Net income for the quarter increased 58.2%to $18.4 million, up from $11.7 million, for the same period last year. Basic and diluted earnings per share for the second quarter of 1999 increased to $.09, up from $.06 for the second quarter of 1998. Revenues for the second quarter of 1999 were $137.0 million, an increase of 49.8%, compared with revenues of $91.5 million for the second quarter of 1998. Excluding a one-time termination fee from a client, net income for the quarter would have increased 18.8%to $13.8 million, or basic and diluted earnings per share of $.07. The termination fee came from a TSYS mid-Western bank client as a result of a merger with a financial institution that processes in-house, and is payment-in-lieu-of processing fees which would have been paid throughout the life of the original processing contract.
Net income for the first six months of 1999 increased 43.3%to $31.4 million, up from $21.9 million for the same period last year. Basic and diluted earnings per share for the first six months increased to $.16, up from $.11 for the first six months of 1998. Revenues for the first six months of 1999 were $252.3 million, an increase of 34.4%, compared with revenues of $187.8 million for the first six months of 1998. Without the one-time fee in the second quarter of 1999, net income for the first six months would have increased 22.3%to $26.8 million, or basic and diluted earnings per share of $.14.
Chairman of the Board and Chief Executive Officer, Richard W. Ussery said, "We are extremely pleased to announce our financial results for the second quarter and first six months of 1999. During the quarter, we successfully converted the third and final phase of the Sears private-label card accounts to TS2®. The combined phases, totaling 63 million accounts, represent the largest conversion in the credit card industry, making TSYS the world’s leading retail processor. We also completed the conversions for a large Canadian bank and Canadian Tire Acceptance Limited during the second quarter of 1999. During the quarter, we announced the signing of a multiyear agreement with Nordstrom National Credit Bank to process its Nordstrom private-label credit card portfolio. We also renewed a long-term processing agreement with First North American National Bank to provide retail card processing for its Circuit City Credit Card.
At the end of the second quarter 1999, TSYS was processing approximately 133.6 million of its 192.0 million accounts on TS2, the industry’s most technologically advanced system designed in the 1990s. TS2 grants issuers the control to quickly implement marketing programs to increase revenues, reduce operating expenses and charge-offs, and better manage their card portfolios.
By the end of the year, TSYS expects to have approximately 195 million accounts on file.
TSYS is one of the world’s leading information technology processors of data, transactions and payments, for domestic and international issuers of credit, debit, commercial and private-label cards. TSYS’ sophisticated systems offer online accounting, data processing, electronic commerce services, portfolio management, account acquisition, credit evaluation, risk management and customer service. Through our family of companies, TSYS services the entire lifecycle of card accounts and processes more than 192 million accounts, making it possible for an estimated 269 million people to use their cards anytime, anywhere. Headquartered in Columbus, Ga., TSYS, (www.totalsystem.com) is an 80.8 percent owned subsidiary of Synovus Financial Corp. (NYSE: "SNV") (www.synovus.com) named the Best Company to Work for in America by FORTUNE magazine.
Contacts:
James B. Lipham
Chief Financial Officer
ph. (706) 649-2262
Patrick A. Reynolds
Director of Investor Relations
ph. (706) 649-5220
The matters set forth in this news release contain forward-looking statements with respect to the number of accounts expected to have at the end of 1999. These forward-looking statements involve risks and uncertainties which could cause actual results to differ materially from those contemplated by such forward-looking statements including, but not limited to, adverse developments with respect to the successful conversion of clients and adverse developments with respect to signing new clients and retaining current clients.