Canada and Europe boost TSYS receipts

Canada and Europe boost TSYS receipts

Credit card processor Total System Services (TSYS) is reporting an 11% gain in fourth quarter income as annual revenues surpass the $1 billion mark for the first time.

The US EFT outfit reported revenue of $278.3 million for the quarter, a gain of 13% from $246 million in the year earlier period.

Net income for the year rose to $39.4 million, or 20 cents per share, compared with $35.5 million, or 18 cents per share in 2002.

Revenues from international clients increased 36.9% for the year, primarily due to conversions of new clients in Canada and Europe.

In the US, TSYS new relationship with Bank One - the Chicago-based bank which last year announced plans to switch card processing from First Data to the TSYS platform - appears safe from the impending merger with JPMorgan Chase.

In a statement, the TSYS says: "Based on discussions with executive management after the recent merger announcement regarding JPMorgan Chase & Co. and Bank One, TSYS expects to complete the conversion of Bank One's card portfolio to the TS2 platform in the second half of 2004, according to schedule."

Analysts have instead focused on the likely ramifications for First Data should Chase also terminate its contract, forecasting a two per cent dip in revenues for a worst case scenario. Chase currently accounts for 10% of First Data's credit card base.

TSYS expects its revenues before reimbursables for the year to grow 11-13% over 2003, and earnings per share to grow 5-7% for the year.

Philip Tomlinson, TSYS chief executive comments: "We remain enthusiastic about the opportunities for growth that lie ahead."

He says the company is developing opportunities to extend processing services in Europe, the Asia-Pacific and United States. Tomlinson also anticipates growing revenue contributions from the continuing roll-out of TSYS ProphIT, a new web-enabled workflow management system, and affiliate companies like TSYS Debt Management and ESC Loyalty.

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