-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CZLUyJqU7lTO5NYjPTi72mAJgSZoCmDcj/Lx9Ozfo7BJS2UoxoT34eqIse/4q/xs 11aOfX2WHvKHgYMbJbaXbQ== 0000721683-07-000010.txt : 20071023 0000721683-07-000010.hdr.sgml : 20071023 20071022182103 ACCESSION NUMBER: 0000721683-07-000010 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20071022 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071023 DATE AS OF CHANGE: 20071022 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOTAL SYSTEM SERVICES INC CENTRAL INDEX KEY: 0000721683 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 581493818 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10254 FILM NUMBER: 071183956 BUSINESS ADDRESS: STREET 1: 1600 FIRST AVENUE STREET 2: P O BOX 1755 CITY: COLUMBUS STATE: GA ZIP: 31901 BUSINESS PHONE: 7066492267 MAIL ADDRESS: STREET 1: 1600 FIRST AVENUE CITY: COLUMBUS STATE: GA ZIP: 31901 8-K 1 october228k.htm TSYS FORM 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

 

October 22, 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 October 22, 2007, Total System Services, Inc. (“Registrant”) issued a press release and will hold an investor call and webcast on October 23, 2007 to disclose financial results for the quarter ended September 30, 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 October 22, 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: October 22, 2007

By:/s/ Kathleen Moates                
Kathleen Moates
Senior Deputy General Counsel

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

 

EX-99.1 2 release.htm REGISTRANT'S PRESS RELEASE DATED OCTOBER 22, 2007

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 26.7% Increase in Net Income for Third Quarter 2007

 

Columbus, Ga., October 22, 2007 TSYS today announced the results for the third quarter with total revenues of $457.6 million, and a 26.7% increase in net income over the same period in 2006. For the first nine months of 2007, TSYS’ total revenues were $1.3 billion, operating income increased 19.2% to $272.8 million, and net income increased to $191.8 million, an 18.3% increase over the same period in 2006.

“Our financial results are exciting with operating margins year-to-date up 300 basis points from 22.6% to 25.6%. This is the sixth quarter in a row that we have shown margin improvement over the same quarter for the prior year. For the third quarter, our operating and net income both were up 26% over the third quarter of 2006. Our revenue growth continues to pick up steam with international revenues growing 38% year-to-date over 2006,” said Philip W. Tomlinson, chairman and chief executive officer of TSYS.

“We are especially proud of our new client commitments for the quarter. These wins in a very competitive market will help drive future growth globally. We remain laser focused on existing clients who generated organic revenue growth of 15% year-to-date in our core processing business. When you consider the obstacles and challenges we faced a year ago, our team has done a magnificent job and we look forward to our future with a great deal of optimism,” said Tomlinson.

 

Financial Highlights

(dollars in millions, except earnings per share data)

Three Months Ended

Nine Months Ended

September 30,

September 30,

 

2007

 

2006

Percent Change

 

2007

 

2006

Percent Change

Revenues Before Reimbursables

$359.0

342.3

4.9%

$1,066.7

1,014.7

5.1%

Total Revenues

457.6

441.8

3.6%

1,347.3

1,283.3

5.0%

Operating Income

91.2

72.3

26.2%

272.8

228.8

19.2%

Net Income

68.8

54.3

26.7%

191.8

162.1

18.3%

Basic EPS

0.35

0.28

26.5%

0.98

0.82

18.5%

Diluted EPS

0.35

0.28

26.5%

0.97

0.82

18.4%

 

— more —

 

Page 1 of 10

 

Recent Highlights

TSYS and Discover Financial Services signed an issuer processor agreement. Under the terms of the agreement, TSYS will begin processing prepaid and credit card transactions on the Discover Network, a business unit of Discover Financial Services.

In the UK, TSYS has signed a long-term agreement with Nationwide, the world’s largest Building Society, to process Nationwide’s credit card account portfolio and to build, operate and manage a new customer care center for member support services. Based on the scope of services, Nationwide would rank among TSYS’ largest clients. Servicing of Nationwide’s more than 1 million credit card Visa accounts and operation of a customer care center for Nationwide is planned for the first quarter of 2008.

TSYS signed Tinkoff Credit Systems, a Moscow-based consumer lending bank, to supply its card management and authorization system. The bank plans to become the first credit card monoliner in Russia and will focus exclusively on issuing credit cards.

TSYS and Lloyds TSB have successfully launched a new money transfer card in the UK. The new Silver account from Lloyds TSB includes an innovative money transfer prepaid product, aimed particularly at the growing number of newly arrived immigrants living and working in the UK.

TSYS and The Gift Voucher Shop (GVS) announced the successful launch of GVS’ One4all retail gift card campaign in hundreds of Post Offices in Ireland and on the GVS Web site.

Commerce Bancorp, Inc. in New Jersey selected the TSYS Collections and Recovery System to manage its entire collections and recovery inventory. This allows the bank to more effectively work all of its delinquent and charged-off card and installment accounts, including automobile loans and mortgages.

TSYS announced a multi–year agreement to provide merchant processing services to Veracity Payment Solutions headquartered in Atlanta, Ga. Veracity will offer complete electronic payment processing services as well as card acceptance consultancy to businesses nationwide.

 

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 expected to increase between 20%–22% in 2007 compared to 2006. Based on generally accepted accounting principles (GAAP), TSYS’ estimated 2007 net income is expected to increase between 0%–2% as compared to 2006. TSYS’ earnings guidance does not include the expenses associated with the potential spin-off of TSYS by Synovus Financial Corp.

 

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.

 

Page 2 of 10

2.

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

3.

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

Percent 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).

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 8:30 a.m. EDT, Tuesday, October 23. 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.

 

Page 3 of 10

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, healthcare, loyalty 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” for 10 consecutive years. 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’ planned servicing of Nationwide’s Visa accounts in the first quarter of 2008 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) expense reductions in employment, equipment, leases and other areas which are included in 2007 estimates will be accomplished; and (3) 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, 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.

 

 

 

 

 

 

 

 

— more —

 

Page 4 of 10

 

 

EX-99.2 3 exhibit992.htm SUPPLEMENTAL INFORMATIN PREPARED FOR USE WITH THE PRESS RELEASE

Exhibit 99.2

TSYS Announces Earnings for 2007

 

 

 

 

 

 

 

 

 

 

 

 

Page 5 of 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TSYS

 

 

Financial Highlights

 

 

(Unaudited)

 

 

(In thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

September 30,

 

 

 

 

 

 

 

Percentage

 

 

 

 

 

 

 

Percentage

 

 

 

2007

 

2006

 

Change

 

 

 

2007

 

2006

 

Change

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronic payment processing services*

$

240,608

 

232,175

 

3.6

%

 

$

715,417

 

685,537

 

4.4

%

Merchant acquiring services

 

65,163

 

65,548

 

(0.6)

 

 

 

190,120

 

195,317

 

(2.7)

 

Other services*

 

53,251

 

44,615

 

19.4

 

 

 

161,190

 

133,827

 

20.4

 

Revenues before reimbursables

 

359,022

 

342,338

 

4.9

 

 

 

1,066,727

 

1,014,681

 

5.1

 

Reimbursable items

 

98,543

 

99,477

 

(0.9)

 

 

 

280,597

 

268,589

 

4.5

 

Total revenues

 

457,565

 

441,815

 

3.6

 

 

 

1,347,324

 

1,283,270

 

5.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries & other personnel expense*

 

144,990

 

139,206

 

4.2

 

 

 

430,966

 

380,931

 

13.1

 

Net occupancy & equipment expense*

 

68,715

 

77,883

 

(11.8)

 

 

 

205,342

 

234,453

 

(12.4)

 

Other operating expenses*

 

54,098

 

52,992

 

2.1

 

 

 

157,605

 

170,452

 

(7.5)

 

Expenses before reimbursable items

 

267,803

 

270,081

 

(0.8)

 

 

 

793,913

 

785,836

 

1.0

 

Reimbursable items

 

98,543

 

99,477

 

(0.9)

 

 

 

280,597

 

268,589

 

4.5

 

Total operating expenses

 

366,346

 

369,558

 

(0.9)

 

 

 

1,074,510

 

1,054,425

 

1.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

91,219

 

72,257

 

26.2

 

 

 

272,814

 

228,845

 

19.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

6,983

 

3,363

 

107.6

 

 

 

18,630

 

9,297

 

100.4

 

Interest expense

 

(916)

 

(235)

 

(289.8)

 

 

 

(1,492)

 

(364)

 

(309.9)

 

Gain on foreign currency translation, net

 

905

 

282

 

220.9

 

 

 

744

 

195

 

281.5

 

Dividend income

 

21

 

-

 

nm

 

 

 

79

 

-

 

nm

 

Other income

 

6,993

 

3,410

 

105.1

 

 

 

17,961

 

9,128

 

96.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes, minority interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

and equity in income of equity investments

 

98,212

 

75,667

 

29.8

 

 

 

290,775

 

237,973

 

22.2

 

Income taxes

 

30,947

 

22,380

 

38.3

 

 

 

101,442

 

78,492

 

29.2

 

Income before minority interest and equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in income of equity investments

 

67,265

 

53,287

 

26.2

 

 

 

189,333

 

159,481

 

18.7

 

Minority interest

 

(483)

 

(183)

 

(163.9)

 

 

 

(1,435)

 

(448)

 

(220.3)

 

Equity in income of equity investments

 

2,020

 

1,202

 

68.1

 

 

 

3,865

 

3,073

 

25.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

68,802

 

54,306

 

26.7

%

 

$

191,763

 

162,106

 

18.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share

$

0.35

 

0.28

 

26.5

%

 

$

0.98

 

0.82

 

18.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share

$

0.35

 

0.28

 

26.5

%

 

$

0.97

 

0.82

 

18.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend declared per share

$

0.07

 

0.07

 

 

 

 

$

0.21

 

0.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average common shares outstanding

 

196,740

 

196,500

 

 

 

 

 

196,641

 

196,891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average common and common

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

equivalent shares outstanding

 

197,089

 

196,831

 

 

 

 

 

197,070

 

197,193

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

* Certain amounts have been previously reclassed to conform with the presentation adopted in 2007.

 

 

 

 

 

 

 

 

 

nm = not meaningful

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- more -

 

 

 

 


 

TSYS Announces Earnings for 2007

 

 

 

 

 

 

 

 

 

 

 

Page 6 of 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TSYS

 

Segment Breakdown

 

(Unaudited)

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2007

 

Three Months Ended September 30, 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

$

243,404

64,148

58,641

366,193

 

242,584

44,320

59,723

346,627

 

Intersegment revenues

 

(6,960)

(106)

(105)

(7,171)

 

(4,258)

-

(31)

(4,289)

 

Revenues before reimbursables

 

 

 

 

 

 

 

 

 

 

 

from external customers

$

236,444

64,042

58,536

359,022

 

238,326

44,320

59,692

342,338

 

Total revenues

$

324,803

66,779

75,356

466,938

 

325,919

51,591

70,592

448,102

 

Intersegment revenues

 

(9,162)

(106)

(105)

(9,373)

 

(6,256)

-

(31)

(6,287)

 

Revenues from external customers

$

315,641

66,673

75,251

457,565

 

319,663

51,591

70,561

441,815

 

Depreciation and amortization

$

24,591

6,455

6,561

37,607

 

32,156

5,328

6,674

44,158

 

Intersegment expenses

$

3,506

(4,995)

(7,884)

(9,373)

 

3,668

(2,343)

(7,599)

(6,274)

 

Segment operating income

$

59,889

12,569

18,761

91,219

 

48,666

7,946

15,645

72,257

 

Income before income taxes, minority interest and

 

 

 

 

 

 

 

 

 

 

 

equity income of equity investments

 

67,060

12,130

19,022

98,212

 

52,688

6,602

16,377

75,667

 

Income tax expense

$

20,084

4,033

6,830

30,947

 

14,722

(31)

7,689

22,380

 

Equity in income of equity investments

$

-

2,020

-

2,020

 

-

1,202

-

1,202

 

Net Income

$

48,890

7,720

12,192

68,802

 

38,821

6,797

8,688

54,306

 

Identifiable assets

 

1,623,928

365,066

188,765

2,177,759

 

 

 

 

 

 

Intersegment eliminations

 

(349,626)

(1,094)

(153)

(350,873)

 

 

 

 

 

 

Total assets

 

1,274,302

363,972

188,612

1,826,886

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2007

 

Nine Months Ended September 30, 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

$

738,712

175,154

171,694

1,085,560

 

740,341

109,178

178,729

1,028,248

 

Intersegment revenues

 

(17,495)

(701)

(637)

(18,833)

 

(13,471)

-

(96)

(13,567)

 

Revenues before reimbursables

 

 

 

 

 

 

 

 

 

 

 

from external customers

$

721,217

174,453

171,057

1,066,727

 

726,870

109,178

178,633

1,014,681

 

Total revenues

$

973,133

182,913

216,354

1,372,400

 

963,855

128,163

211,659

1,303,677

 

Intersegment revenues

 

(23,738)

(701)

(637)

(25,076)

 

(20,311)

-

(96)

(20,407)

 

Revenues from external customers

$

949,395

182,212

215,717

1,347,324

 

943,544

128,163

211,563

1,283,270

 

Depreciation and amortization

$

76,305

17,762

20,146

114,213

 

95,759

14,101

20,446

130,306

 

Intersegment expenses

$

9,897

(11,961)

(23,007)

(25,071)

 

18,949

(15,448)

(23,864)

(20,363)

 

Segment operating income

$

190,336

35,570

46,908

272,814

 

176,412

12,029

40,404

228,845

 

Income before income taxes, minority interest and

 

 

 

 

 

 

 

 

 

 

 

equity income of equity investments

 

210,027

32,661

48,087

290,775

 

186,170

9,718

42,085

237,973

 

Income tax expense

$

73,737

10,441

17,264

101,442

 

58,636

2,461

17,395

78,492

 

Equity in income of equity investments

$

-

3,865

-

3,865

 

-

3,073

-

3,073

 

Net Income

$

138,625

22,316

30,822

191,763

 

128,352

9,064

24,690

162,106

 

 

 

 

 

 

 

 

 

 

 

 

 

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.

- more -

 

 

 


 

TSYS Announces Earnings for 2007

 

 

 

Page 7 of 10

 

 

 

 

 

 

 

TSYS

Balance Sheet

(In thousands)

 

 

Sept 30, 2007

Dec 31, 2006

 

 

(unaudited)

(audited)

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

592,834

389,123

Restricted cash

 

32,079

31,568

Accounts receivable, net

 

251,778

246,637

Deferred income tax assets

 

27,909

21,556

Prepaid expenses and other current assets

 

58,809

55,832

Total current assets

 

963,409

744,716

Property and equipment, net

 

276,113

271,321

Computer software, net

 

190,338

216,450

Contract acquisition costs, net

 

161,239

167,449

Goodwill, net

 

142,450

133,337

Equity investments, net

 

65,669

62,064

Other intangible assets, net

 

13,999

21,314

Other assets

 

13,669

17,590

Total assets

$

1,826,886

1,634,241

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

37,419

31,589

Accrued salaries and employee benefits

 

71,335

80,697

Current portion of notes payable and obligations under capital leases

 

5,822

3,156

Other current liabilities

 

137,704

180,345

Total current liabilities

 

252,280

295,787

Deferred income tax liabilities

 

72,318

75,019

Obligations under notes payable and capital leases excluding current portion

 

73,862

3,625

Other long-term liabilities

 

30,718

36,221

Total liabilities

 

429,178

410,652

Minority interest in consolidated subsidiary

 

7,943

6,229

Shareholders' Equity:

 

 

 

Common stock

 

19,920

19,868

Additional paid-in capital

 

84,835

66,677

Treasury stock

 

(34,300)

(35,233)

Accumulated other comprehensive income

 

25,575

20,641

Retained earnings

 

1,293,735

1,145,407

Total shareholders' equity

 

1,389,765

1,217,360

Total liabilities and shareholders' equity

$

1,826,886

1,634,241

 

 

 

 

- more -

 

 

 


 

TSYS Announces Earnings for 2007

 

 

 

 

Page 8 of 10

 

 

 

 

 

 

 

 

 

TSYS

 

Cash Flow

 

(Unaudited)

 

(In thousands)

 

 

 

Nine Months Ended September 30,

 

 

 

2007

2006

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

Net income

$

191,763

162,106

 

Adjustments to reconcile net income to net cash provided by

 

 

 

 

operating activities:

 

 

 

 

Minority interests in consolidated subsidiaries' net income

 

1,435

448

 

Equity in income of equity investments

 

(3,865)

(3,073)

 

Dividends received from equity investments

 

2,994

2,371

 

Gain on currency translation adjustments, net

 

(744)

(195)

 

Depreciation and amortization

 

114,213

130,306

 

Share-based compensation

 

9,881

6,574

 

Asset impairments

 

1,158

-

 

Provisions for bad debt expense and billing

 

 

 

 

adjustments

 

1,612

948

 

Charges for transaction processing provisions

 

531

7,914

 

Deferred income tax benefit

 

(6,828)

(24,150)

 

Loss on disposal of equipment, net

 

497

105

 

(Increase) decrease in:

 

 

 

 

Accounts receivable

 

(5,627)

(40,765)

 

Prepaid expenses, other current assets and other long-term assets

 

(1,041)

8,923

 

Increase (decrease) in:

 

 

 

 

Accounts payable

 

6,148

14,323

 

Accrued salaries and employee benefits

 

(9,341)

(18,936)

 

Excess tax benefit from share-based payment arrangements

 

(4,022)

(1,646)

 

Other current liabilities and other long-term liabilities

 

(51,286)

(14,849)

 

Net cash provided by operating activities

 

247,478

230,404

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Purchases of property and equipment, net

 

(36,420)

(21,203)

 

Additions to licensed computer software from vendors

 

(8,194)

(9,650)

 

Additions to internally developed computer software

 

(11,749)

(13,699)

 

Cash acquired in acquisitions

 

-

4,341

 

Cash used in acquisitions

 

(472)

(74,919)

 

Additions to contract acquisition costs

 

(20,878)

(39,578)

 

Net cash used in investing activities

 

(77,713)

(154,708)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Proceeds from borrowings of long-term debt

 

73,968

-

 

Principal payments on long-term debt borrowings and

 

 

 

 

capital lease obligations

 

(3,893)

(1,561)

 

Proceeds from exercise of stock options

 

5,258

3,725

 

Excess tax benefit from share-based payment arrangements

 

4,022

1,646

 

Repurchase of common stock

 

-

(21,843)

 

Dividends paid on common stock

 

(41,425)

(37,504)

 

Net cash provided by (used in) financing ativities

 

37,930

(55,537)

 

Effect of exchange rate changes on cash and cash equivalents

 

(3,984)

(2,006)

 

Net increase in cash and cash equivalents

 

203,711

18,153

 

Cash and cash equivalents at beginning of year

 

389,123

237,569

 

Cash and cash equivalents at end of period

$

592,834

255,722

 

- more -

 

 

 


 

TSYS Announces Earnings for 2007

 

 

 

 

 

 

 

 

 

 

Page 9 of 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Geographic Area Data:

 

 

 

 

 

 

 

 

 

 

 

The following geographic area data represents revenues for the three months ended September 30 based on where the client is domiciled:

 

 

 

 

 

 

Three Months Ended September 30,

 

(dollars in millions):

 

2007

 

%

 

 

2006

 

%

 

% Chg

 

United States

$

352.2

77.0

%

$

359.6

81.4

%

(2.1)

%

Europe

 

56.1

12.3

 

 

43.7

9.9

 

28.4

 

Canada

 

32.4

7.1

 

 

25.4

5.8

 

27.7

 

Japan

 

6.3

1.4

 

 

5.0

1.1

 

25.5

 

Mexico

 

3.6

0.8

 

 

3.2

0.7

 

14.4

 

Other

 

7.0

1.4

 

 

4.9

1.1

 

41.4

 

 

$

457.6

100.0

%

$

441.8

100.0

%

3.6

%

 

 

 

 

 

 

 

 

 

 

 

The following geographic area data represents revenues for the nine months ended September 30 based on where the client is domiciled:

 

 

 

 

 

 

Nine Months Ended September 30,

 

(dollars in millions):

 

2007

 

%

 

 

2006

 

%

 

% Chg

 

United States

$

1,052.4

78.1

%

$

1,069.8

83.3

%

(1.6)

%

Europe

 

151.1

11.2

 

 

112.6

8.8

 

34.2

 

Canada

 

93.2

6.9

 

 

71.5

5.6

 

30.4

 

Japan

 

17.7

1.3

 

 

13.4

1.0

 

32.0

 

Mexico

 

10.2

0.8

 

 

8.5

0.7

 

18.9

 

Other

 

22.7

1.7

 

 

7.5

0.6

 

204.4

 

 

$

1,347.3

100.0

%

$

1,283.3

100.0

%

5.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Geographic Area Revenue by Operating Segment:

 

 

 

 

 

 

 

The following table reconciles segment revenues to revenues by reporting segment for the three months ended September 30:

 

 

 

 

 

Three Months Ended September 30,

 

 

Domestic-based
support services

 

 

International-based
support services

 

Merchant acquiring
services

 

 

 

 

 

(dollars in millions):

 

2007

2006

 

 

2007

2006

 

2007

2006

United States

$

276.8

 

289.3

 

 

 

0.5

 

-

 

 

74.9

 

70.3

 

Europe

 

0.4

 

0.4

 

 

 

55.7

 

43.3

 

 

-

 

-

 

Canada

 

32.2

 

25.2

 

 

 

-

 

-

 

 

0.2

 

0.1

 

Japan

 

-

 

-

 

 

 

6.3

 

5.0

 

 

-

 

-

 

Mexico

 

3.6

 

3.2

 

 

 

-

 

-

 

 

-

 

-

 

Other

 

2.6

 

1.6

 

 

 

4.2

 

3.3

 

 

0.2

 

0.1

 

 

$

315.6

 

319.7

 

 

 

66.7

 

51.6

 

 

75.3

 

70.5

 

 

 

 

 

 

 

 

 

 

 

 

 

The following table reconciles segment revenues to revenues by reporting segment for the nine months ended September 30:

 

 

 

 

 

Nine Months Ended September 30,

 

 

Domestic-based
support services

 

 

International-based
support services

 

Merchant acquiring
services

 

 

 

 

 

(dollars in millions):

 

2007

2006

 

 

2007

2006

 

2007

2006

United States

$

837.1

 

859.0

 

 

 

0.6

 

-

 

 

214.7

 

210.7

 

Europe

 

1.3

 

1.1

 

 

 

149.8

 

111.5

 

 

-

 

-

 

Canada

 

92.8

 

71.1

 

 

 

-

 

-

 

 

0.4

 

0.4

 

Japan

 

-

 

-

 

 

 

17.7

 

13.4

 

 

-

 

-

 

Mexico

 

10.2

 

8.5

 

 

 

-

 

-

 

 

-

 

-

 

Other

 

8.0

 

3.8

 

 

 

14.1

 

3.3

 

 

0.6

 

0.5

 

 

$

949.4

 

943.5

 

 

 

182.2

 

128.2

 

 

215.7

 

211.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- more -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

TSYS Announces Earnings for 2007

 

 

 

 

 

Page 10 of 10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Information:

 

 

 

 

 

 

 

Accounts on File at September 30,

 

 

(in millions)

 

2007

 

%

 

 

2006

%

 

% Change

 

 

Consumer

 

197.0

55.2

%

259.3

64.8

%

 

(24.0)

%

 

 

Retail

 

47.9

13.4

 

51.5

12.9

 

 

(7.0)

 

 

 

Commercial

 

37.5

10.5

 

32.5

8.1

 

 

15.6

 

 

 

Government services/EBT

 

23.2

6.5

 

20.7

5.2

 

 

11.8

 

 

 

Stored Value

 

46.3

13.0

 

31.7

7.9

 

 

46.2

 

 

 

Debit

 

5.2

1.4

 

4.3

1.1

 

 

19.4

 

 

 

 

 

357.1

100.0

%

400.0

100.0

%

 

(10.7)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

September 30, 2007

 

 

September 30, 2006

 

 

% Change

 

QTD Average Accounts on File

 

384.3

 

 

 

385.8

 

 

 

(0.4)

 

%

YTD Average Accounts on File

 

412.1

 

 

 

413.6

 

 

 

(0.4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts on File at September 30,

 

(in millions)

 

2007

%

 

2006

%

 

% Change

 

Domestic

 

284.5

 

79.7

%

 

334.0

 

83.5

%

(14.8)

%

 

International

 

72.6

 

20.3

 

 

66.0

 

16.5

 

10.0

 

 

 

 

357.1

 

100.0

%

 

400.0

 

100.0

%

(10.7)

%

 

 

 

 

 

 

 

 

 

 

 

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):

 

 

 

 

 

 

 

 

September 2006 to September 2007

 

 

September 2005 to September 2006

 

Beginning balance

 

400.0

 

 

 

430.1

 

 

Change in accounts on file due to:

 

 

 

 

 

 

 

 

Internal growth of existing clients

 

32.0

 

 

 

38.0

 

 

New clients

 

71.0

 

 

 

33.1

 

 

Purges/Sales

 

(9.6)

 

 

 

(13.9)

 

 

Deconversions

 

(136.3)

 

 

 

(87.3)

 

 

Ending balance

 

357.1

 

 

 

400.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of Employees (FTEs):

 

2007

 

 

2006

 

At September 30,

 

6,775

 

 

 

6,788

 

 

Quarterly average for period ended September 30,

6,751

 

 

 

6,640

 

 

YTD average for period ended September 30,

 

6,752

 

 

 

6,616

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

###

 

 

 

GRAPHIC 4 newimage.jpg begin 644 newimage.jpg M_]C_X``02D9)1@`!`0$!+`$L``#_VP!#``,"`@,"`@,#`P,$`P,$!0@%!00$ M!0H'!P8(#`H,#`L*"PL-#A(0#0X1#@L+$!80$1,4%145#`\7&!84&!(4%13_ MP``+"`">`K`!`1$`_\0`'P```04!`0$!`0$```````````$"`P0%!@<("0H+ M_\0`M1```@$#`P($`P4%!`0```%]`0(#``01!1(A,4$&$U%A!R)Q%#*!D:$( M(T*QP152T?`D,V)R@@D*%A<8&1HE)B7J#A(6&AXB)BI*3E)66EYB9FJ*CI*6FIZBI MJK*SM+6VM[BYNL+#Q,7&Q\C)RM+3U-76U]C9VN'BX^3EYN?HZ>KQ\O/T]?;W M^/GZ_]H`"`$!```_`/U3HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHKG=8^(WA3P]?R6.J^)]&TR]C`+VUYJ$44B@C( MRK,",@YJ@WQB\!@C_BM?#ISZ:K!_\72+\9/`A/\`R.OA[_P:P?\`Q=3VOQ7\ M%7]U';VOB_0;FXD.U(H=3@=V/H`&R:D^('B:Y\,>'TO+)8GN)+RUME64$@B6 MXCC8@`C)"NQ_"NC$H,8?VS5:VUBRO)FB@NX9I%ZHDBL1^`-7-P]11D>HHW#U M%&PW1D$6Q1]K`[6'4'T/M5BBBBBBBBBBBBBBBB MBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBD/`K\'O\` M@IYX@U>[_;+\9C3Y]0BMX8;*';"[A-RVL8.`..M?*$OB#7;=@LNIZA&V,X:X MD!_G48\3:R03_:U]Q_T\O_C72_#GQ!KK_$3PQ$FLZA&TNIVT8=;A^C2J/7WK M^A3]H2>32_A]I]ZL;7$MGJ]A)%"LGE^;)YZ*BENVYF`KY.\9_'+Q9XG\2W]] M#JEQ900.;06UO*R1P[@2%(!`+`'[V.P-<,GB+Q'9Z@+^UO+^.9&:7S$N75"S M$$AE!Y!VX]N/2ND^&?Q>\;^!-5MQ;:W=ZNL]RD30ZG%=/^(?AF\U*WL3!Y=W8VUVT'V=5+;9@=R[MYVJ0%R.">`<>'^' MOC9XH\'^)[">;6M0:YR'%A:^3OB_^U=J:^(+\>%9#$L`-I:\,5N7^-[J$ M1L/"6BW"PZK=G2]-U`7!5I@T:DW04H"FPEAY;$;N"&%<8/BO,_A&XB76-8N] M#75^`_CYXE:PLKSP]K\NH11&*SFL[ MWS9%\UY53&9,`#CZL^!-Q>:G\._MMZ4^T7]W>7),7RJ=TSY(QT MR?`L!WX9@P*NHR`0!T)PK$GD\#Z=6HP,4M%%%%%%%%%%% M%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%(>0:J' M2[1V)>VA=CU9D!)_&OQ%_P""PUO';?M;PI%&D2'PY9':B@#/F3>E>,_L'>%K M#QG^UK\.=)U2V2\T^:_8SP2`E741.<''TK]Y+;]G?X1(Y9-2LH0)1\K!KA-P)P<8`)S[5^9T'C;5 M_"7CMU>!]5T2XU6)#I^]84MDCDN08`2"SHT:I^]S_#@$+W4- M,TG7_#,VABZG6RF9)1P5R`2HD4#L,Q2Q' MHRD8(_*OS2_:,_9[O?A=XEGFL56RTJ3Y-%99@VP)(&`PS$_*C%>>N_UQ570_ MCCXD^'_@75O"&GAM4TG5Y=K:BVU6PT66(0*01(-JY![<FS>;*X`,N1 MF1B"<#(!X!^E?F3XG\"3ZA9?9&E,PNPD=U,H">#="\(ZMH9TF:R@2"2YM\SB4HNU96X^\XC+D`D`\5WQ\2_!'XXWD1 M%TINX)5#^>DUN&"2*P0MPN-^TYSU%>S_``R^RMX3MA8W`NK&.:YAAD4`#8EQ M(H48[*%VY[XS77!0O04M%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%)D>HHR M/6C(/>C1@H'XFI`P/0@T$@=3BCM&1ZT9'K1D>M&1ZT`@]#FEI,CUHR/6EI,CUI:3('>C(]:,CUI:3(/ M>EHHHK\,?^"OTS3?MAW:EPPBT.Q0`'.WAVP?3[V?QKA/^":`S^VG\.Q_TUN/ M_2:2OZ!T&%`]*\R^/MOI=UX?T"/6EMVTHZW:_:5N\>28\G=OSQC'K7S1X_\` MV'M)^)L<=Y\/_&$$D5NWDO+<77F#<-VY=T<9Z`K@?[3>M9UC^Q#KGAO2C'J\ M>E:IY=ZEVUWIX9KFX10)#'(73E/,4U.]F$^H-:QQW3YR6E50 MK$Y)/.-W/)R#WI?C-\+/#_Q1\(3V>OQ[$MO])AO(MBRP%65SM=E.U3L`8=QP M:_,7PEJ^FO>:;:#4PD2):/!#(8P(8ED"?*N<9`1\#&`P%???[(_PZTK0_`,? MB"*&*XU#5999?MCX>18]VW8K8R%^7.`<=*]UN[2&[@D@N(DG@E4I)%(H974C M!4@]01GBOE_Q]^RKX>\3ZSJD'A+6K2#5%S<7.E7$R&.%7;"KL1253"R@`^@' M8UY/K_[)7C;P]J?VF."+5=\,:%;(M($(9P,?(.0&.?8UX/-X5O\`PO?7&DS2 M36L432K<1WI*2F5G#%,8P=I3.,9!8GG=Q^CG[)430_L]>$$3[YKUZBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBOE_P#X*1^*-<\' M_LHZ]J/AW6]3\.ZH-0TZ%-0TB[DM;B-7NXU8+(A##()!YY!K&7]AI;GP_'=) M\?OC;!I-KM_P"' M];NM'CUMY'E:_C3:PD:1B=Y^?&>.-O%>1_L]_"+6?VD_&OQIO]>^,WQ5T3^P M_&M[I=E8>'?%DUK;Q6XPR@(0^.6(&,#"]*A\:PZ]^RI^U7\&M%\+?%WQ?\0+ M3Q9J:Z5K'AWQ=X@DU22WA=XQYZQC;LP&<[B.-IZBO8_^"F?BO7?!G[,XO_#V MO:KX:U"37M/MVU#1;R2UN5C=R&"NA!Y';.*RK;]E'PA+!&[?M/?%Y690Q`^( MR@C_`,L>(=2_M"\G#,3\TV!N`Z#T` M`KX-\+/%^U3\<_BMI?Q.^,?BCX=3:3KT^D:-X+T7Q"=),MK&S;)WADW"0E0" M2O&MW:ZMXJOY;_4+&[7@Q>:0 M$"-DG&"?N],5A_\`!0KXFZ]X5N?A7X2M/$]QX!\+^*]9:VUSQ?:7+VDVGPQ[ M&"I<`@1EP7'(.=O;FN9\8_LV>+?#?@FW\=?!/XZ?$#QYK^FSP74.F^(?%DFI MZ9J"95FC9(U&5*4!=<'T) M(_"M1QD8K\\O"/PJ\3?M(_M0_M#6%[\9?B3X1TSPMK-I!I]AX;\136UNB30N MS#8254`QC`4#J:H_&_P_XU_8C\:_"O6O#OQA\9?$!-=\0Q:1=>&?&.M27YN( MY009(HAM)V],YX9TX.:^A_\`@HCXGUGP7^QK\0];\/:O?Z%K%JEB8-1TRZ>W MN(=U_;*VR1"&7*LRG!Y!(KSSP1^PQK/B+P;H.J7W[1GQE2]O;""YG6U\6R^4 M)'C5F"9&=N2<9[5]*?!+X33?!WP@^AS>,O$OC@FX>X_M/Q5?F\NP&`_=^80# ML&.![FO!_P!C_P`?:YXO_:5_:6T_4-;U34=)TC7H+;3[*_NGEBLUQ('6%&8B M-25SA<=J^O&Z&OST\5>&?%?QP_X*%?$+P+_PM7QWX,\/Z1H%GJ%K:^&=;EM8 MED*Q`YCY3!WDGY0:^DIY1#&SL0H`)))X%?F-I/[4OQ#;]IQ?B]_;EQ-\`M2\6G MP5#9&>1K1!Y2(MVJ[O*`,BYW[NI;BOTZC?S!D#'UK\[](N?$'[6?[2?Q7T'7 MOC+K_P`,;+PKK$NBZ1X;\*ZX^FWETD4FS[3)&2=ZOE<%<9+#CI7L/P/\#_%G MX(?'RX\'ZCXAUOXB?"[5-->\MM?\07,MW>Z?.1@US_\` MP48\4>*=&O\`X&Z)X;\6ZUX13Q-XPATB^N]#NVMYF@E*(<$=2-V1D$9'2NJ7 M]B362/\`DXSXPC_N/I_\;KZ)\$>'I/"7A?2]%EU6^UV6Q@6!M2U.3S+FY(&- M\K`#G_\`H@5SO_!,*Q>^_;3\!A.#$+N8 MG/9;:4FOW]3[@YS7@W[9<%Y>?#+3[6Q`,]QJ<<:JWW2=CMS[`*3^`KY+\&?% M+7OAEJDJZ-J+HY8)]G=R\4C`ACE0<$X4C/ID=Z[O5/VL_'NI:;/9O/80I<0O M"9K>W*2`D$':V[Y2,C!%>%^%_`1NO'.DKIUK/=/,?LA@AD"Y=@=JG/'+["?H M*_$>R^'7B;P?>^&=4GLKZ\31;\0W5G->Q`W M%H-H9MY8`@D$HI.5[CFOV._9CT:+0/@3X+L8)VN(XM/3YW)+`GJI)ZD'()[D M9KC_`-L+6OBIH?@=I_AQ:1W=N89EU-XR%NK:+83YT;%U/`##"@MD@]`:^"?` MWQ!\9^"/$=OKUAJ&I+JQ$\2PW]RQ>Y8R$`2EB/,14+$`G[PR.HKZ`\*_MI?$ M[4[R.*ZTC1U0JMN[-`5(N619`?\`6],$CZX->7:_XJN/B'JMUXDU#RI&U"8L M[1)M",`!PIY'8?C7WM^R^K)\"O"X=!&P6XRH&,?Z3+7J=%%%%%%%%%%%%%%% M%%%%%%%%%%%%%%%%%%%?)/\`P5*C$W['7B*,LRJ^IZ6I9#A@#>1=#ZUGZ+_P M3D\*SZ992/\`%#XK212PQM+;GQ4P1@0"5XCSC\:^C?A%\(O#7P.\$6'A/PI8 M+8:1:`D#"^9*Y^])(P`WN>,L>3@5\'?LO_LP>'_CEXS^/.K:KXB\6Z)3VQ2_L_\`@:P_9=_;6NO!7Q(4^(7\0PM<>"/% MNN'[;>,0R@V_FG<8VVAADA!E6Y^89]@_X*J6\=_^RS#;2L5CE\2:9&Y4X(!E M(.#VJ./_`()K?!TQ(X\2^-"^`2/^$H?'\J^HOA_X0TOX;?#[2_#>AS7-[IVD M6OV>W>YN/.GD"Y/S2'[S'U-?*?ACP-\%/V_M-U#Q=<>'[OPIXKT;4Y]+U`V$ MR6FHQ31L/OS(N7W+@Y!/!P3G-,]<\9>"O$VCS:C M]GTPQQR;6#M@`-)&!P"<-SZU[9^T)\1OA]JWQ5\*?!3XB>&8]2L/& M-G/-9:G>QQRV\+?" MNI^'%.JQ:=+KLCZ?.(R&\@P*!][:J``@8P#Q7V)^SOXXU3XE?`_P/XIUJ&*W MU76-'M;ZY2%2J>9)$K,5!)(!)R`3WKT-SA23VK\X/A5^SMH?[0'[6'[4,VJ^ M(_%6AMIFO6<40\-ZS)8!R\4H8R!?OD&/`STR?6N>\#?#73OV6?VX=,T7XL:A MJ/C#PWKF1X#UOQ%=MJ!M;HRJ!&P;=LDR47?M3D`@XKZ:_P""FY!_87^)@']S M3\?^#&UK"\%_L#^!;[PCH=P_CSXCQO+8P2%(?%TZ(I,:D@*.`.N`.*^E/A3\ M/-/^%/@BS\-:;J.IZI:6K.5N=8O6O+EBS%CNE;D]>/08KY/_`&%Y$C_:D_:O MW,J@^)X\9./XIJ^W1-&^0KJQQT!S7YOZW\&='^-O_!33XHZ3K.L:]HMM;>&[ M&Y6;P_JCV$S,$@7:SIR5Y/'KCTKZ:^'G[&_A'X:>-=*\3:=XQ\=:C>:?(72V MU;Q//=6TF5*G?$W###$X/<`]J=^WE\9)O@U^SCXAO=,N#%XCU?;HVD*@;<]S M.0G!'W2$WL"2.5'.<"OB_5OV9_VHU_9@_P"%3?\`"'^$(_#-G`MS$UOY2WXF MC?SA()1<[?-+#!?;SD^M?;/[$WQFE^-W[-?A7Q!'/$FE7\NEW]_X?G.FWIG3!/F-Y M8,A&5()R/E'I7'>"I?'/[)W[7W@;X6CQEJ7CGP'XWCNI8(M>O&O+^P,,3L/W MA(``*KT7!&[OTN?\%1-%@\3ZM^SKH]S-<6UOJ'CNVM)9K.4Q31K(T:%D<IR:UJ***^?/C#^PG\&_CKXYO/%WC+PQ+J>O74< M44MRNH7$0*QH$4;4<*/E`'`J+X2?L&?!KX'>.;'Q?X.\+2:9K]FDD<-RVH7$ MP59$*/\`*[E3E6(Z=Z^AU&U0/2N$^)FFS:GK/@A$B,T4>L"2:/8"NT0R'))Z M`=??I6?JW[.O@#7#>R7.A*7O9/.F9+B52S[MV[AN#D]OITK!M?V3?`<=_=33 M:<\\4P=1$9Y`$#'(((?J.>:[_P`'_##PWX"BDCT+34L1)M+D,SEMN<ZD8(KB[SX(^"K^#R;C0H98^ZF23GC'][ MW-==I6DVNBV,-G91""VA&U(USA1ZQW\&EK-?0;E@GE=R8T(^[]X@XRV,^OL*Z3X01B/ MP#9@)M#7-XX."-X-U*0^#TW9W8[9Q79T4444444444444444444444444444 M444445R/Q4^%/AGXT>#;CPMXNT\ZGHEQ+%/);B5XLO&X=#N0@\,H/6NIMK>. MT@CAB7;'&H55]`!@"I&7<,=*XOX=_!WPM\*I?$4GAG3SI[^(-2EU?46,SR>= M=2`!G^8G;PHX&!QTJA\7_@%X*^.VG:59>,]*.IPZ5>IJ-D4GDA>&=00'#(P) MX8\'CVJ?XN_`_P`(_'3P2WA+QGI[ZKH331W!MQ/)$3(A)4[D(/<]Z\%E_P"" M67[.)`QX'GSZ_P!KW?\`\=KWKX._!'PE\!O!47A3P7I[:5H<.F:AJ*A+F\FO)[F61000N9';`R!TK<^-'P&\% M?'[PLGA_QQHRZUIL"^#_`/@F%\'?#^OWFH:I M8WOB.W-XMWI]E>W]R([$*6VH,3?O,97EO[ON:^N+6V2T@CAC`6.-0JJ!@``8 M`I\B[UQ7`?#[X(^%/AEXI\8^(?#^GO9ZKXNO%O\`6)VN))/M$RER&`9B%_UC M\+@<^U'QE^!'@WX^>'+70_&NEG5=/M;N.^@19Y(6CG0,%<,C`]'88Z10PW%N9W1I%BD21,NI#`[HU/!YQ7BR?\$U?@*@ M`7PUJ:J``%77[X`8]!YM>O?!OX"^$/@)H5]HW@RRN+#3[RY-W+'7P<\8^/O$?BS6-%O9]1UV?[7=>1JEU`#,>6;Y)` M.2>F,"NX^"7[+'@;]GW7-;U#P=:7=G_:D444D=S?3W(4)D\>8[=2Q/:O.OCU M_P`$^/`?Q[\?WWC+4;R^TO7KQ((Y[FTFE&](P%VX611RH`Z5SDG_``3`^&=M MXVL-O=?BK^SYH/Q?\8>`==U M]I)QX/U%]3M;0%A'+*4`4MAA]U@K#.>F.A->I>6&CVD<>E>5?!7]G3P]\"=9 M\YN]6TZ620W)965MT;2;`3N/('X5M_L^_L6>"O@'X@U#Q1`]QKW MC2^:83:_>R2>:8Y&W-&$+E`-V3D#OVJ_^U3^RCH7[57A[0]*UO4;C2_[(O3> MV]Q;`E@Q0J1@,OMS[5\Z'_@D)X0S_P`C]KWYR_\`QZOL#X&?"2U^!WPRT;P9 M8W\^I6FF*ZQW-SGS'W.SG.6)ZMZUW]%%%%)C%+2,H88(S1TI:*******3%(Z M[A@T(H10HZ"G444444444444444444444444444444444444444444444444 M444444E&,T8S1BBEHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHK*O\`Q5HV MEW!M[W5K&SG`R8KBX1&QZX)S5?\`X3OPU_T,&E_^!L?_`,51_P`)WX:_Z&'2 MO_`V/_XJC_A._#7_`$,.E?\`@;'_`/%4?\)WX:_Z&'2O_`V/_P"*J>V\6Z)> MN$MM7L;AST6*Y1B?R-7EU"V?.+B(X.#\XI?MMO\`\]X_^^Q1]MM_^>\?_?8H M^VV__/>/_OL4?;;?_GO'_P!]BD^WVW_/>/\`[Z%*+ZW/_+>/_OH4OVR#_GO' M_P!]BC[9!_SWC_[[%'VR#_GO'_WV*#>6X'^OC_[[%(+ZW)4>E-$JGO2B12<#FES[&C/L:,^QHS[&C/L:,^QHHS0WW3]*PO! M?B-?%6@6^I)$T/F[E:-CDHRL589^JFMZBBBBBD)`&3561V:Z0JS>7L.1C@G( M[^O^-3M*H7&<&F07"R>:.1L?:HD#A MR6;<">.,8&3_`(_I4V106`I-XI=P%-,GS`#O3@E?AC_P`%>QY?[85R M%X']AV/\GKXFHS1FC-2Q74L./+D9".A5B*D_M2\_Y^IQ_P!M#_C1_:=Y_P`_ M<_\`W\;_`!H_M.\_Y^Y_^_C?XT?VG>?\_<__`'\;_&C^T[S_`)^Y_P#OXW^- M']IWG_/W/_W\/^-*=5O2,&\GQ_UT/^-)_:E[_P`_<_\`W];_`!H_M2]_Y^Y_ M^_K?XT?VI>_\_<__`'];_&C^U+W_`)^Y_P#OZW^-=!9?%+Q9IU[I5Y;:[=Q7 M.E79OK*0/S#.65RX]]R(>>/EKNM*_;#^,NB02PV/C_5+>.6:2X=5\OF1V+.W M*]R2?QJY_P`-M_'/_HI&K?E%_P#$4?\`#;?QS_Z*1JWY1?\`Q%'_``VW\<_^ MBD:M^47_`,11_P`-M_'+_HI&K?E%_P#$4G_#;/QQQC_A8^K?E%_\11_PVS\< M3G_BX^K<^T7_`,11_P`-L_''_HH^K?E%_P#$4O\`PVU\%_M%_]%6U MK_OF'_XW1_P\+_:+_P"BK:U_WS#_`/&Z/^'A?[1?_15M:_[YA_\`C='_``\+ M_:*_Z*KK(_X##_\`&Z4?\%#/VB@,'XJ:R?\`@,/_`,;I/^'A?[16/^2JZS_W MS#_\;H_X>%_M%_\`15M9_P"^8?\`XW1_P\+_`&B_^BK:U_WS#_\`&Z/^'A?[ M1?\`T5;6O^^8?_C='_#PO]HO_HJVM?\`?,/_`,;H_P"'A?[1?_15M:_[YA_^ M-T?\/"_VB_\`HJVM?]\P_P#QNC_AX5^T4>OQ6UDC_=A_^-TYO^"AW[13*BGX MIZN-N>1'`"?J?+YK<_X>>?M)A]P^(S9P!@Z18D#&>@\CW_SBG?\`#T#]I?\` MZ*.?_!-8?_&*/^'H'[2__11S_P"":P_^,4?\/0/VE_\`HHY_\$UA_P#&*/\` MAZ!^TO\`]%'/_@FL/_C%'_#T#]I?_HHY_P#!-8?_`!BC_AZ!^TO_`-%'/_@F ML/\`XQ1_P]`_:6P?^+CG_P`$]A_\8H_X>?\`[2N2?^%C'_P3V'_QBD_X>??M M+'C_`(60V#_U![#_`.,4#_@H'^T-\-T70]+^(\(LT_TD?9;"RN$W3?OF^=H2 M2=TAR,_*P_^,4?\//OVEO\`HI#?^">P_P#C%*/^ M"GW[2V>?B0Q'_8'L/_C%)_P\^_:6_P"BD-_X)[#_`.,4?\//OVEO^BD-_P"" M>P_^,4?\//OVEO\`HI#?^">P_P#C%2VG_!4/]I*&ZADF^(1N(D=6>%M(L0'` M/*DB#(STXKK+'_@K5\;[=YVN-0MKP.TAC#VT"B,-]T#$7.WL3U[UT/\`P^,^ M+)T:\M/[*TS[7-/++%>_+NA1I"RQA=FTA5(0$\D#)YJUIW_!8_XD:?>ZC<'P MOI,PO)$E\MI2`A6-4.#L[A`:T?\`A]-\1_\`H3M&_P"_[?\`Q-'_``^F^(__ M`$)VC?\`?]O_`(F@_P#!:;XC'KX.T;'_`%W;_P")J*U_X+0_$J"$))X3T>=P M2=[3$$Y)(X"=NGX5+_P^F^(__0G:-_W_`&_^)H_X?3?$?_H3M&_[_M_\30?^ M"TWQ'/\`S)VC?]_V_P#B:BM_^"T/Q*AB59/">CS,.KM,1GGV2I?^'TWQ'_Z$ M[1O^_P"W_P`32'_@M-\2#_S)^C#_`+;M_P#$TG_#Z3XCX'_%'Z/_`-_V_P#B M:5O^"TOQ(/3P?HPX_P">[?\`Q-'_``^B^(_#?\(=HV>G^O;_`.)KZ!_8;_X* M/^,?VG?CK!X(UOP]IVG64FGW-V9[:4LX:,*0,%1ZU^BM%(>E>:^./V:_A=\3 MM>.M>+O`6@>(]7,2PF^U*Q2:4HN=J[B,X&37/_\`#%/P'_Z))X1_\%47^%-? M]BCX#D$?\` MP51?X4?\,4_`?_HDGA'_`,%47^%'_#%/P'_Z))X1_P#!5%_A2-^Q3\!R./A) MX1_\%47^%F,#ZFO-KG_@ MD7\"+JY>5H_$$6XYV0WL2J/8#R:;_P`.@_@+_P!3)_X'P_\`QFC_`(=!_`7_ M`*F3_P`#X?\`XS1_PZ#^`O\`U,G_`('P_P#QFD_X=!_`;_J9,_\`7_#_`/&: M;_PZ#^!.#_R,6<_\_P!%_P#&:D_X="_`7^[XC_\``^+_`.,T?\.A?@+_`'?$ M?_@?%_\`&:/^'0OP%_N^(_\`P/B_^,T?\.A?@+_=\1_^!\7_`,9IDO\`P2#^ M`[*=O_"1@X(_X_XO_C-5KG_@CS\"K@Y\[Q1%DY/EZC$/_:'^>:B?_@CC\"78 MDW?BQ<]EU*$`?3]Q1_PYL^`O_/\`>,?_``:0_P#QBC_AS9\!?^?[QC_X-(?_ M`(Q1_P`.;/@+_P`_WC'_`,&D/_QBC_AS9\!?^?[QC_X-(?\`XQ2?\.;/@/\` M\_OC#_P:0_\`QBD_X+O\`P9P__&*/^'-GP)_Y_?%W_@TA_P#C M%*/^"-GP&[WWC'_P:0__`!BE_P"'-GP%_P"?[QC_`.#2'_XQ1_PYL^`O_/\` M>,?_``:0_P#QBC_AS9\!?^?[QC_X-(?_`(Q3#_P1L^!(=2M]XOP#R#J<)R,' M_IAZX_*D7_@C9\"U09OO%S/C&3J<./R\BJ$G_!&#X,M-(RZ_XNCC;;MC^V6Y MVX^]SY'.?TJC)_P13^$DAR/%_C"/V6:U/?\`ZX?A^%-_X3XR\7^;M.SS);7;G'&<0=*YQ_P#@BCX9`NMGC74\F=O(W/'Q#E]N M[]S]_'EYQQ][VKB_^')VN;[L_P#"+]+M-5TGQYH264\2X699]P=?ED!_=\?.&JX?\`@B5XZ`_Y'[P]_P!\S_\` MQNFO_P`$3O':)D>._#['TVS_`/QND_X'O^^9_P#XW2/_`,$3O':J2/'GAXG_ M`'9__C=*?^")GCHG/_">>'A_P&?_`.-T@_X(G>.@V#X\\.[3_LSY_P#1=!_X M(F^.AS_PGGA[\5G_`/C=06G_``1>\:ZD)1'XSTBV>WD:"0W$4ZK(PY#Q_N^4 MVLHSZAO2K'_#DOQU_P!#YX>_[YG_`/C='_#DOQU_T/GA[_OF?_XW0O\`P1-\ M=*?^1\\/'ZK/_P#&Z1?^")GCLCGQYX>_[YG_`/C=*/\`@B9XZ!_Y'SP]_P!\ MS_\`QNFS?\$3O'BK^[\=^'2?=9__`(W567_@BE\1QROCKPL!DGE+GIV_Y9]: M8?\`@BA\2I&)C\>>%=G;*W/_`,;I6_X(F_$PGCQYX5X'=;G_`.-T?\.3/B;_ M`-#YX4_[YNO_`(W1_P`.3/B;_P!#YX4_[YNO_C=+_P`.3OB61@>//"N>^4N? M_C=*/^")_P`2PNW_`(3OPL6SG[MSC_T77T5^PI_P3C\5_LK?&:?QEXA\1:%K M=LVF3644>GI-YJ.[(=V70#&%(_&OT$HHHHHHHHHHHHHHHHHHHHHHHHHHHHHH MHHHHHHHHHHHHHHHHHHHHHHHHHHHHHI&&Y2/48K.T'0;+PWIT=AI\/D6D;.R1 M[F;!9B[K$UI4F*,4M%(1FEJ)\^:/3'7\ZD(W#!H50HP*6BDQFBEI,5%, MN0`#@]J986\EO:1QS2>=(H.7"[<\^E6:**3%+2`8I:****************** M************************************************************ (********_]D_ ` end
-----END PRIVACY-ENHANCED MESSAGE-----