8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

April 19, 2007

Date of Report

(Date of Earliest Event Reported)

Total System Services, Inc.

(Exact Name of Registrant as Specified in its Charter)

Georgia
(State of Incorporation) 1-10254
(Commission File Number) 58-1493818
(IRS Employer Identification No.)

1600 First Avenue, Columbus, Georgia 31901

(Address of principal executive offices) (Zip Code)

(706) 649-2267

(Registrant's telephone number, including area code)

________________________________________________

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02	Results of Operations and Financial Condition.
	On April 19, 2007, Total System Services, Inc. (“Registrant”) issued a press release and will hold an investor call and webcast to disclose financial results for the quarter ended March 31, 2007. The press release and Supplemental Information for use at this investor call are attached hereto as Exhibits 99.1 and 99.2 and incorporated herein by reference. This information shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934 or incorporated by reference into any document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934 except as shall be expressly set forth by specific reference in such filing.
Item 7.01	Regulation FD Disclosure. See Item 2.02 above.
Item 9.01	Financial Statements and Exhibits.
	(d)	Exhibits
	Exhibit No.	Description
	99.1	Registrant's press release dated April 19, 2007
	99.2	Supplemental Information prepared for use with the press release

2

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, Registrant has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	TOTAL SYSTEM SERVICES, INC. ("Registrant")
Dated: April 19, 2007	By:/s/ Kathleen Moates Kathleen Moates Senior Deputy General Counsel

3

EX-99.1

Exhibit 99.1

Total System Services, Inc.

1600 First Ave. +1.706.649.2307

P.O. Box 2567 +1.706.649.5740

Columbus, GA 31902-2567 www.tsys.com

For immediate release.

Contacts:

James B. Lipham Chief Financial Officer +1.706.649.2262 Shawn Roberts TSYS Investor Relations +1.706.644.6081 shawnroberts@tsys.com

TSYS Reports Strong 13.7% Increase in Net Income for First Quarter 2007

Company Also Increases 2007 Net Income Guidance Range

Columbus, Ga., April 19, 2007— TSYS today announced the results for the first quarter with revenues of $429.6 million, and a 13.7% increase in net income over the same period in 2006.

“We are extremely proud of our financial results for the first quarter and we are excited to announce a significant improvement in our guidance for 2007, which is a direct result of our robust core revenue growth and continued focus on streamlining costs,” said Philip W. Tomlinson, chairman and chief executive officer of TSYS.

“The results for the first quarter compared to last year are impressive, as the results for last year include revenues from two significant clients that deconverted after the first quarter of 2006. Our internal revenue growth in our core processing business was 12.3%, and new business, including acquisitions, added 20% of revenue growth, both of which helped overcome a 27% decline in revenues associated with deconverted portfolios. In addition, our international revenues for the first quarter grew 47% over last year, and we expect continued growth for the remainder of 2007,” said Tomlinson.

“Our team is committed to providing the highest quality of service faster, better, cheaper as well as smarter. The result of their efforts is clearly reflected in our expansion of operating margin, excluding reimbursable items, to 24.9% in the first quarter of 2007 over 21.8% in the same period of 2006. For the full year, we project this margin to be around 25%,” continued Tomlinson.

“Our strong operating results continue to produce internal operating funds, as demonstrated by the $66 million of cash generated from operating activities, which allows us the flexibility to pursue acquisitions and internal expansion,” said Tomlinson.

“On a non-GAAP (generally accepted accounting principles) basis, net income is now expected to increase between 20%-22% in 2007 compared to 2006.On a GAAP basis, TSYS’ 2007 net income is expected to be between 0%-2% as compared to 2006. We believe 2007 will be a year we will truly be proud of,” said Tomlinson.

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2007

Financial Highlights

(dollars in millions, except earnings per share data)	Three Months Ended
	March 31,
	2007	2006	Percent Change
Revenues Before Reimbursables	$343.6	329.6	4.3%
Total Revenues	429.6	412.3	4.2%
Operating Income	85.7	71.9	19.2%
Net Income	57.3	50.4	13.7%
Basic EPS	0.29	0.26	14.0%
Diluted EPS	0.29	0.26	13.9%

Recent Highlights

• TSYS completed the Capital One conversion in the first quarter of 2007.

• TSYS signed a contract extension with Spira de México, S.A. de C.V., to continue processing its consumer-credit portfolio. Under terms of the agreement, TSYS will continue to provide risk management, portfolio management and reporting tools to Spira.

• TSYS' PRIME card and merchant management system was chosen by Norway's largest financial-services group, DnB NOR Bank ASA, to manage the fast growing cards portfolio of its market leading credit card operator, DnB NOR Kort. DnB NOR Kort has plans to further expand its service solutions for DnB NOR Kort customers. With support from TSYS Card Tech, DnB NOR Kort is able to implement SEPA compliant technology with flexible cost effective software and leading edge customer services.

• TSYS renewed merchant-processing service agreements with Sage Payment Solutions and Moneris Solutions covering its U.S. portfolio.

• TSYS signed agreements to provide merchant-processing services for Clearent and National Processing Company, formerly Iron Triangle Payment Systems.

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2007

Projected Outlook for 2007

Excluding the one time Bank of America contract termination fee in 2006 of approximately $68.9 million and the acceleration of amortization of Bank of America contract acquisition costs of approximately $6 million, net income is now expected to increase between 20%–22% in 2007 compared to 2006, versus previous guidance of an increase between 14%-17%. Based on GAAP, TSYS’ estimated 2007 net income is now expected to be between 0%–2% as compared to 2006, versus previous guidance of a decline between 5%–3%.

TSYS’ 2007 earnings guidance is based on the following assumptions:

1.     Including the Bank of America contract termination fee of approximately $68.9 million in 2006 and an acceleration of amortization of contract acquisition costs of approximately $6 million, estimated total revenues will decline 3%–2% in 2007. Excluding the termination fee and reimbursable items, revenues will increase by 3%-5% over 2006.

2. J.P. Morgan Chase & Co. will discontinue its processing agreement according to the original schedule and will license TSYS’ processing software in the third quarter of 2007.

3. Expense reductions in employment, equipment, leases and other areas that are included in 2007 estimates will be accomplished.

4. TSYS will not incur significant expenses associated with the conversion of new large clients and/or acquisitions, or any significant impairment of goodwill or other intangibles.

Presentation of revenues and net income excluding the Bank of America termination fee, acceleration of amortization of contract acquisition costs and reimbursable items are non-GAAP financial measures. The following table reconciles the range of changes from 2006 to 2007, comparing non-GAAP financial measures to GAAP financial measures.

	Range of Guidance ($ in millions)
	2007 Forecast	2006 Actual	% change
Net income	$250 to $255	$249	0% to 2%
Less: termination fee, net of acceleration of amortization of contract acquisition costs, net of tax		($41)
Net income, excluding impact of termination fee, net of acceleration of amortization of contract acquisition costs	$250 to $255	$208	20% to 22%
Total revenues	$1,742 to $1,760	$1,787	(3%) to (2%)
Less: reimbursable items	($329)	($353)
Less: termination fee, net of related contract acquisition cost amortization*		($65)
Revenues, excluding reimbursable items and net termination fee	$1,413 to $1,431	$1,369	3% to 5%

*Note: TSYS accelerated the amortization of approximately $6 million in contract acquisition costs (comprised of $4 million of amortization related to payments for processing rights, which was recorded as a reduction of revenues, and $2 million of amortization expense related to conversion costs).

2007

TSYS believes the table above presents meaningful information to assist investors in understanding the company’s financial estimates for changes in total revenues and net income from 2006 to 2007 as a result of the Bank of America consumer portfolio deconversion as the non-GAAP financial measures exclude amounts that the company does not consider part of ongoing operating results. The non-GAAP financial percentage changes should not be considered by themselves or as a substitute for the GAAP percentage changes year over year. The non-GAAP measures should be considered as an additional view of the way TSYS’ financial measures are affected by the one-time Bank of America contract termination fee, acceleration of amortization of contract acquisition costs and reimbursable items; and should be used in conjunction with all publicly filed financial statements and reports.

Conference Call

TSYS will host its quarterly conference call at 4:30 p.m. EDT, Thursday, April 19. The conference call can be accessed via simultaneous Internet broadcast at tsys.com by clicking on the “Conference Call” icon on the homepage. The replay will be archived for 12 months and will be available approximately 30 minutes after the completion of the call.

About TSYS

TSYS is one of the world’s largest payment-services companies, offering a broad range of packaged or outsourced issuing and acquiring technologies that support consumer finance, credit, debit and prepaid services for financial institutions and retail companies worldwide. Based in Columbus, Ga., TSYS (NYSE: TSS) is 81-percent held by Synovus (NYSE: SNV), one of FORTUNE magazine’s “Most Admired Companies” and a member of its “100 Best Companies to Work For” Hall of Fame. For more information, contact news@tsys.com.

This press release contains statements that constitute “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934 as amended by the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among others, statements regarding TSYS’ expectation that international revenue growth will continue in 2007, TSYS’ projection that its net operating margin, excluding reimbursable items, will be around 25% and TSYS’ expected net income growth for 2007, and the assumptions underlying such statements, including, with respect to TSYS’ expected increase in net income for 2007: (1) including the Bank of America contract termination fee of approximately $68.9 million in 2006 and an acceleration of amortization of contract-acquisition costs of approximately $6 million, estimated total revenues will decline 3-2% in 2007 and excluding the termination fee and reimbursable items, estimated revenues will increase by 3%-5% over 2006; (2) JP Morgan Chase & Co. will discontinue its processing agreement according to the original schedule and will license TSYS' processing software in the third quarter of 2007; (3) expense reductions in employment, equipment, leases and other areas which are included in 2007 estimates will be accomplished; and (4) TSYS will not incur significant expenses associated with the conversion of new large clients and/or acquisitions, or any other significant impairment of goodwill or other intangibles. These statements are based on the current beliefs and expectations of TSYS’ management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by the forward-looking statements. A number of important factors could cause actual results to differ materially from those contemplated by our forward-looking statements in this press release. Many of these factors are beyond TSYS’ ability to control or predict. These factors include, but are not limited to, one or more of the assumptions upon which TSYS’ 2007 net income forecast is based are inaccurate. Additional factors that could cause actual results to differ materially from those contemplated in this release can be found in TSYS’ filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K,

2007

Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise.

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2007

EX-99.2

Exhibit 99.2

TSYS Announces Earnings for 2007
Page 6 of 11
TSYS
Financial Highlights
(Unaudited)
(In thousands, except per share data)
		Three Months Ended
		March 31,
				Percentage
		2007	2006	Change
Revenues
Electronic payment processing services	$	230,165	221,061	4.1	%
Merchant acquiring services		60,680	63,949	(5.1)
Other services		52,766	44,542	18.5
Revenues before reimbursables		343,611	329,552	4.3
Reimbursable items		85,992	82,738	3.9
Total revenues		429,603	412,290	4.2
Expenses
Salaries & other personnel expense		140,443	121,330	15.8
Net occupancy & equipment expense		66,136	75,350	(12.2)
Other operating expenses		51,353	61,015	(15.8)
Expenses before reimbursable items		257,932	257,695	0.1
Reimbursable items		85,992	82,738	3.9
Total operating expenses		343,924	340,433	1.0
Operating income		85,679	71,857	19.2
Other income:
Interest income		5,488	2,508	118.8
Interest expense		(210)	(44)	nm
Gain on foreign currency translation, net		683	276	147.5
Dividend income		15	-	nm
Other income		5,976	2,740	118.1
Income before income taxes, minority interest
and equity in income of equity investments		91,655	74,597	22.9
Income taxes*		34,892	24,965	39.8
Income before minority interest and equity
in income of equity investments		56,763	49,632	14.4
Minority interest		(350)	(91)	nm
Equity in income of equity investments		860	852	0.9
Net income	$	57,273	50,393	13.7	%
Basic earnings per share	$	0.29	0.26	14.0	%
Diluted earnings per share	$	0.29	0.26	13.9	%
Dividend declared per share	$	0.07	0.06
Average common shares outstanding		196,487	197,086
Average common and common
equivalent shares outstanding		196,938	197,326
* Includes $2.3 million of additional expense in 1st Quarter 2007 related to the recoverability of certain income tax credits.
nm = not meaningful
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TSYS Announces Earnings for 2007
Page 7 of 11
TSYS
Segment Breakdown
(Unaudited)
(In thousands)
			Three Months Ended March 31, 2007				Three Months Ended March 31, 2006
			Domestic- based support services	International- based support services	Merchant acquiring services	Consolidated	Domestic- based support services	International- based support services	Merchant acquiring services	Consolidated
Revenues before reimbursables		$	240,969	52,963	54,818	348,750	244,443	30,713	58,862	334,018
Intersegment revenues			(4,781)	(223)	(135)	(5,139)	(4,434)	-	(32)	(4,466)
Revenues before reimbursables
from external customers		$	236,188	52,740	54,683	343,611	240,009	30,713	58,830	329,552
Total revenues		$	314,458	55,400	66,884	436,742	312,830	36,246	70,332	419,408
Intersegment revenues			(6,781)	(223)	(135)	(7,139)	(7,086)	-	(32)	(7,118)
Revenues from external customers		$	307,677	55,177	66,749	429,603	305,744	36,246	70,300	412,290
Depreciation and amortization		$	25,967	5,800	6,830	38,597	31,910	3,978	7,273	43,161
Intersegment expenses		$	3,407	(3,239)	(7,302)	(7,134)	8,690	(7,575)	(8,219)	(7,104)
Segment operating income		$	61,587	12,129	11,963	85,679	60,966	879	10,012	71,857
Income before income taxes, minority interest
and equity income of equity investments			67,693	11,477	12,485	91,655	63,479	728	10,390	74,597
Income tax expense		$	26,249	4,172	4,471	34,892	20,471	567	3,927	24,965
Equity in income of equity investments		$	-	860	-	860	-	852	-	852
Net Income		$	41,563	7,696	8,014	57,273	42,819	1,111	6,463	50,393
Identifiable assets			1,543,651	318,241	218,378	2,080,270
Intersegment eliminations			(415,896)	(1,136)	(129)	(417,161)
Total assets			1,127,755	317,105	218,249	1,663,109
Note:	Revenues from domestic-based services include electronic payment processing services and other services provided from the United
	States to clients domiciled in the United States or other countries. Revenues from international-based services include electronic payment
	processing services and other services provided from outside the United States to clients based mainly outside the United States.
	Revenues from merchant processing services include TSYS Acquiring's merchant acquiring and related services.
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TSYS Announces Earnings for 2007
Page 8 of 11
TSYS
Balance Sheet
(Unaudited)
(In thousands)
		Mar 2007	Dec 2006
Assets
Current assets:
Cash and cash equivalents	$	421,711	389,123
Restricted cash		42,643	31,568
Accounts receivable, net		238,892	246,637
Deferred income tax assets		23,306	21,556
Prepaid expenses and other current assets		51,107	55,832
Total current assets		777,659	744,716
Property and equipment, net		275,567	271,321
Computer software, net		204,683	216,450
Contract acquisition costs, net		166,785	167,449
Goodwill, net		141,840	133,337
Equity investments, net		63,721	62,064
Other intangible assets, net		15,525	21,314
Other assets		17,329	17,590
Total assets	$	1,663,109	1,634,241
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	30,920	31,589
Accrued salaries and employee benefits		41,486	80,697
Current portion of obligations under capital leases		2,875	3,156
Other current liabilities		192,714	180,345
Total current liabilities		267,995	295,787
Deferred income tax liabilities		74,812	75,019
Notes payable		6,805	-
Obligations under capital leases excluding current portion		3,204	3,625
Other long-term liabilities		35,497	36,221
Total liabilities		388,313	410,652
Minority interest in consolidated subsidiary		6,623	6,229
Shareholders' Equity:
Common stock		19,911	19,868
Additional paid-in capital		75,070	66,677
Treasury stock		(34,547)	(35,233)
Accumulated other comprehensive income		20,533	20,641
Retained earnings		1,187,206	1,145,407
Total shareholders' equity		1,268,173	1,217,360
Total liabilities and shareholders' equity	$	1,663,109	1,634,241
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TSYS Announces Earnings for 2007
Page 9 of 11
TSYS
Cash Flow
(Unaudited)
(In thousands)
		Three Months Ended March 31,
		2007	2006
Cash flows from operating activities:
Net income	$	57,273	50,393
Adjustments to reconcile net income to net cash provided by
operating activities:
Minority interests in consolidated subsidiaries' net income		350	91
Equity in income of equity investments		(860)	(852)
(Gain) loss on currency translation adjustments, net		(683)	(276)
Depreciation and amortization		38,597	43,161
Share-based compensation		3,036	2,267
Impairment of developed software/contract acquisition costs		620	-
Provisions for (recoveries of) bad debt expense and billing
adjustments		(1,239)	567
Charges for transaction processing provisions		(792)	4,161
Deferred income tax (benefit) expense		(1,006)	(5,069)
Loss on disposal of equipment, net		20	92
(Increase) decrease in:
Accounts receivable		9,089	(22,684)
Prepaid expenses, other current assets and other long-term assets		(3,518)	4,405
Increase (decrease) in:
Accounts payable		735	8,718
Accrued salaries and employee benefits		(39,211)	(44,884)
Excess tax benefit from share-based payment arrangements		(2,503)	-
Other current liabilities and other long-term liabilities		6,542	(1,705)
Net cash provided by operating activities		66,450	38,385
Cash flows from investing activities:
Purchases of property and equipment, net		(17,232)	(5,786)
Additions to licensed computer software from vendors		(3,884)	(1,776)
Additions to internally developed computer software		(3,039)	(3,773)
Cash used in acquisitions		(472)	-
Additions to contract acquisition costs		(7,145)	(9,554)
Net cash used in investing activities		(31,772)	(20,889)
Cash flows from financing activities:
Proceeds from borrowings of long-term debt		6,805	-
Principal payments on long-term debt borrowings and
capital lease obligations		(562)	(402)
Proceeds from exercise of stock options		3,518	-
Excess tax benefit from share-based payment arrangements		2,503	-
Dividends paid on common stock		(13,783)	(11,837)
Net cash used in financing activities		(1,519)	(12,239)
Effect of exchange rate changes on cash and cash equivalents		(571)	31
Net increase in cash and cash equivalents		32,588	5,288
Cash and cash equivalents at beginning of year		389,123	237,569
Cash and cash equivalents at end of period	$	421,711	242,857
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TSYS Announces Earnings for 2007
Page 10 of 11
Geographic Area Data:
The following geographic area data represents revenues for the three months ended March 31 based on where the client is domiciled:
		Three Months Ended March 31,
(dollars in millions):		2007	%			2006	%		% Chg
United States	$	337.7	78.6	%	$	349.8	84.8	%	(3.5)	%
Europe		45.9	10.7			32.7	7.9		40.4
Canada		30.0	7.0			22.1	5.4		35.8
Japan		5.3	1.2			3.9	0.9		37.0
Mexico		3.3	0.8			2.5	0.6		30.7
Other		7.4	1.7			1.3	0.4		nm
	$	429.6	100.0	%	$	412.3	100.0	%	4.2	%

Geographic Area Revenue by Operating Segment:
The following table reconciles segment revenues to revenues by reporting segment for the three months ended March 31:
		Three Months Ended March 31,
		Domestic-based support services		International-based support services		Merchant processing services
(dollars in millions):		2007	2006	2007	2006	2007	2006
United States	$	271.2	279.8	-	-	66.5	70.0
Europe		0.4	0.3	45.5	32.4	-	-
Canada		29.9	22.0	-	-	0.1	0.1
Japan		-	-	5.3	3.9	-	-
Mexico		3.3	2.5	-	-	-	-
Other		2.9	1.1	4.4	-	0.1	0.2
	$	307.7	305.7	55.2	36.3	66.7	70.3
nm = not meaningful
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TSYS Announces Earnings for 2007
Page 11 of 11
Supplemental Information:
		Accounts on File at March 31,
(in millions)		2007	%		2006	%		% Change
Consumer		268.9	63.6	%	272.5	61.8	%	(1.3)	%
Retail	*	52.5	12.4		82.9	18.8		(36.7)
Commercial		32.8	7.8		31.2	7.1		5.2
Government services/EBT		21.5	5.1		19.2	4.4		12.4
Stored Value	*	42.2	10.0		26.7	6.1		57.8
Debit		4.8	1.1		7.9	1.8		(39.0)
		422.7	100.0	%	440.4	100.0	%	(4.0)	%

*Certain accounts previously classified as Retail have been reclassified as Stored Value to conform with the presentation adopted
in the second quarter of 2006.
(in millions)	March 31, 2007	March 31, 2006	% Change
YTD Average Accounts on File	418.3	439.3	(4.8)

	Accounts on File at March 31,
(in millions)	2007	%		2006	%		% Change
Domestic	353.5	83.6	%	383.5	87.1	%	(7.8)	%
International	69.2	16.4		56.9	12.9		21.5
	422.7	100.0	%	440.4	100.0	%	(4.0)	%
Note: The accounts on file between domestic and international is based on the geographic domicile of processing clients.

Growth in Accounts on File (in millions):
	March 2006 to March 2007	March 2005 to March 2006
Beginning balance	440.4	370.6
Change in accounts on file due to:
Internal growth of existing clients	36.2	44.1
New clients	96.1	39.3
Purges/Sales	(19.2)	(12.3)
Deconversions	(130.8)	(1.3)
Ending balance	422.7	440.4

Number of Employees (FTEs):	2007	2006
At March 31,	6,766	6,579
YTD average for period ended March 31,	6,721	6,641
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