Total System Services — Q1 2019 Earnings Presentation
23 slides from Total System Services's earnings presentation, Apr 23, 2019
Slide 1: 2019 First Quarter
2019 First Quarter April 23, 2019 ©2019 Total System Services, Inc.® Proprietary. All rights reserved worldwide.
Slide 2: Forward-looking Statements
Forward-looking Statements This slide presentation and comments made by management contain forward-looking statements including, among others, statements regarding the expected future operating results of TSYS. These statements are based on management’s current expectations and assumptions and are s
Slide 3: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures This slide presentation and comments made by management contain certain non-GAAP financial measures determined by methods other than in accordance with generally accepted accounting principles. Such non-GAAP financial measures include the following: net revenue, op
Slide 4: M. Troy Woods
M. Troy Woods Chairman, President & Chief Executive Officer ©2019 Total System Services, Inc.® Proprietary. All rights reserved worldwide.
Slide 5: Paul Todd
Paul Todd Chief Financial Officer ©2019 Total System Services, Inc.® Proprietary. All rights reserved worldwide.
Slide 6: Consolidated Selected Financial Highlights
Consolidated Selected Financial Highlights (in thousands, except per share data) YTD YTD Percent 2019 2018 Change Total Revenues $1,034,531 $987,170 4.8% Net Revenue(1) 980,270 935,497 4.8 Adjusted EBITDA(1) 357,287 330,922 8.0 Adjusted Diluted EPS(1) $1.20 $1.13 5.8 (1) Non-GAAP financial measure;
Slide 7: Consolidated Highlights
Consolidated Highlights 1st Quarter Net Revenue by Segment(1)(2) ➜ Strong performance across all three Consumer Solutions Issuer Solutions segments 23% 42% ➜ Record net revenue and adjusted EBITDA ➜ Purchased 4.3 million shares for $400.0 million Merchant Solutions 35% Consolidated Net Revenue(1) Ad
Slide 8: Issuer Solutions Segment Highlights
Issuer Solutions Segment Highlights Traditional Accounts on File YOY Growth % (in millions) ➜ Record adjusted segment EBITDA and 614.0 628.2 EBITDA margin 578.6 588.9 594.4 ➜ Record traditional AOF ➜ Multiple contract extensions and a solid pipeline of new business 8.7% 8.6% 5.8% 7.4% 8.6% 1Q18 2Q18
Slide 9: Merchant Solutions Segment Highlights
Merchant Solutions Segment Highlights Segment Net Revenue per Transaction YOY Growth % ➜ Strong net revenue and adjusted segment EBITDA growth $0.237 $0.231 $0.226 $0.223 $0.225 ➜ Expanded margins ➜ Announced partnership with T-Mobile and renewal of BB&T 2.6% 2.4% 1.0% (3.8%) (5.1%) 1Q18 2Q18 3Q18 4
Slide 10: Consumer Solutions Segment Highlights
Consumer Solutions Segment Highlights Gross Dollar Volume YOY Growth % ($ in billions) ➜ Record net revenue and adjusted segment $9.7 $10.1 EBITDA $8.3 $8.4 ➜ Record gross dollar volume of over $10 billion $8.1 ➜ Extended Brink’s, Western Union and other key distribution partners 0.9% 9.6% 11.2% 10.
Slide 11: Adjusted Segment EBITDA Margin
Adjusted Segment EBITDA Margin Three Months Ended March 31, 2019 Adjusted Segment Segment Net Adjusted Segment EBITDA Revenue EBITDA Margin (in thousands) Issuer Solutions $204,934 $433,473 47.3% Merchant Solutions 128,836 342,956 37.6% Consumer Solutions 63,693 219,178 29.1% Intersegment -- (15,337
Slide 12: 2019 Guidance
2019 Guidance* (in millions, except per share data) Range Range Percent Change Revenue: Total revenues (GAAP) $4,190 to $4,290 4% to 6% Net revenue(1) (non-GAAP) $3,990 to $4,090 5% to 7% Earnings per share: Diluted EPS (GAAP) $3.48 to $3.63 11% to 16% Adjusted diluted EPS attributable to TSYS commo
Slide 13: Q&A
Q&A ©2019 Total System Services, Inc.® Proprietary. All rights reserved worldwide.
Slide 14: Thank You
Thank You ©2019 Total System Services, Inc.® Proprietary. All rights reserved worldwide.
Slide 15: Appendix
Appendix ©2019 Total System Services, Inc.® Proprietary. All rights reserved worldwide.
Slide 16: Appendix: Accounts on File Portfolio Summary
Appendix: Accounts on File Portfolio Summary (in millions) March March % March December % 2019 2018 Change 2019 2018 Change Consumer 523.0 486.5 7.5 523.0 514.6 1.6 Commercial 60.2 55.2 8.9 60.2 57.8 4.2 Other 45.0 36.9 22.2 45.0 41.6 8.4 Traditional AOF 628.2 578.6 8.6 628.2 614.0 2.3 Prepaid*/Stor
Slide 17: Net Revenue, Adjusted EBITDA and Adjusted Diluted EPS
Net Revenue, Adjusted EBITDA and Adjusted Diluted EPS Appendix: Non-GAAP Items • Net revenue is defined as total revenues less reimbursable items (such as postage) that are recorded by TSYS as expense. • Adjusted EBITDA is net income excluding equity in income of equity investments, interest expense
Slide 18: Net Revenue
Net Revenue Appendix: Non-GAAP Reconciliation (in thousands) Three Months Ended 3/31/19 3/31/18 Total revenues $1,034,531 $987,170 Less: reimbursable items 54,261 51,673 Net revenue $980,270 $935,497 18 ©2019 Total System Services, Inc.® Proprietary. All rights reserved worldwide.
Slide 19: Constant Currency Total Revenues and Net Revenue
Constant Currency Total Revenues and Net Revenue Appendix: Non-GAAP Reconciliation Three Months (in thousands) Ended Percentage 3/31/19 3/31/18 Change Consolidated: Total revenues (GAAP) $1,034,531 $987,170 4.8% (1) Foreign currency impact 8,270 -- Constant currency(2) (non-GAAP) $1,042,801 $987,170
Slide 20: Adjusted EBITDA
Adjusted EBITDA Appendix: Non-GAAP Reconciliation Three Months Ended (in thousands) 3/31/19 3/31/18 Net income (GAAP) (a) $161,607 $143,102 Adjust for: Less: Equity in income of equity investments (11,227) (10,608) Add: Income tax expense 29,899 18,135 Add: Interest expense, net 42,769 36,652 Add: D
Slide 21: Adjusted Diluted EPS
Adjusted Diluted EPS Appendix: Non-GAAP Reconciliation (in thousands, except per share data) Three Months Ended 3/31/19 3/31/18 Net income attributable to TSYS common shareholders: (GAAP) (a) $161,607 $141,841 Adjust for: Add: Acquisition intangible amortization 54,957 62,988 Add: Share-based compen
Slide 22: 2019 Guidance
2019 Guidance* (in millions, except per share data) Range Range Percent Change Total revenues (GAAP) $4,190 to $4,290 4% to 6% Less: reimbursable items 200 to 200 Net revenue (non-GAAP) $3,990 to $4,090 5% to 7% Diluted EPS (GAAP) $3.48 to $3.63 11% to 16% Acquisition intangible amortization, share-
Slide 23: Appendix: 2019 Guidance Assumptions
Appendix: 2019 Guidance Assumptions The guidance assumes: • There will be no significant movements in the London Interbank Offered Rate; • There will be no additional significant movement in foreign currency exchange rates related to TSYS’ business; • TSYS will not incur significant expenses associa
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