TSYS (NYSE: TSS) today reported results for the third quarter of 2012. For the quarter, basic earnings per share was $0.32, an increase of 5.7% over 2011. Revenues before reimbursable items were $406.1 million and operating income was $90.9 million, increases of 4.1% and 12.0%, respectively, as compared to 2011. Total revenues for the quarter were $468.1 million, an increase of 1.8% over 2011, and were impacted by a decrease of $7.6 million in reimbursable items.
The operating margin for the quarter was 22.4%, an increase of 157 basis points over the third quarter of last year. The increase is attributable to the 4.1% increase in revenues before reimbursable items while expenses before reimbursable items were up 2.0%.
POS transactions, excluding deconverted clients in the indirect merchant business, were up 9.5% and sales volume in the direct merchant business was up 17.4%. Excluding the impact of the acquisition, sales volume was up 9.3%. North America and International issuer processing businesses grew with same client transactions up 10.1% over last year.
“In August, TSYS formed a joint venture with Central Payment Co., LLC to further strengthen our sales distribution channels in the direct merchant business. Also during the quarter, we spent $61.2 million as we purchased 2.6 million shares of our stock bringing our share repurchases since September 2010 to 12.3 million and a total spend of $227.0 million. We continue to see value in our buyback program, absent a strategic acquisition, and have 7.7 million shares remaining under the plan that expires in April 2014. We also closed a new credit facility of $500 million this quarter with a 5-year term loan of $150 million and a 5-year revolver of $350 million that included nine banks. This new revolver, along with our free cash flow, will provide us with more financial flexibility as we continue to make investments that we expect to grow our company and enhance shareholder return,” said Tomlinson.
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