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 22, 2014

Date of Report (Date of Earliest Event Reported)

Total System Services, Inc.

(Exact Name of Registrant as Specified in its Charter)

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

One TSYS Way, Columbus, Georgia 31901

(Address of principal executive offices) (Zip Code)

(706) 649-2310

(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 22, 2014, Total System Services, Inc. (“Registrant”) issued a press release announcing financial results for the first quarter ended March 31, 2014. The press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information in the press release 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.

On April 22, 2014, Registrant will hold an investor conference call and webcast to discuss its financial results for the first quarter ended March 31, 2014. A copy of the presentation to be used during the conference call is attached hereto as Exhibit 99.2 and incorporated herein by reference. The information in the presentation 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 8.01 Other Events.

On April 22, 2014, Registrant announced the sale of its business interests in Japan.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1	Registrant’s press release dated April 22, 2014
99.2	Registrant’s presentation dated April 22, 2014

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 22, 2014	By:	/s/ Kathleen Moates
		Kathleen Moates
		Senior Deputy General Counsel

3

EX-99.1

Exhibit 99.1

Total System Services, Inc. One TSYS Way P.O. Box 2567 Columbus, GA 31902-2567 +1.706.649.2307
+1.706.649.5740
    www.tsys.com

For immediate release:

Contacts:

Shawn Roberts

TSYS Investor Relations

+1.706.644.6081

shawnroberts@tsys.com

TSYS Reports First Quarter 2014 Total Revenues Increased 32.1%

COLUMBUS, Ga., April 22, 2014 — TSYS (NYSE: TSS) today reported results for the first quarter of 2014 and announced the sale of its business interests in Japan. The accompanying financial statements have been adjusted to exclude the Japanese results from ongoing operations in 2014 and 2013 with those results reported as “discontinued operations” for all periods presented.

Total revenues for the quarter were $592.8 million, an increase of 32.1%. Revenues before reimbursable items were $532.8 million, an increase of 37.3%. The reported results for the quarter for both total revenues and revenues before reimbursable items exclude $16.2 million of revenue for Japan as a result of moving these results to discontinued operations. Adjusted EBITDA was $149.6 million, an increase of 21.2%. Income from continuing operations was $50.6 million. Adjusted cash earnings per share (EPS) from continuing operations was $0.38. On a GAAP basis, basic EPS from continuing operations was $0.26. Diluted EPS from continuing operations was $0.26.

“We are pleased with the first quarter as the financial results met or exceeded our plans. Our cash flow from operations was $148.7 million and our free cash flow was $101.5 million, which were increases of $96.3 million and $104.4 million, respectively, over last year. During the quarter, we also deployed $37.5 million of our capital to increase our stake in our Central Payment joint venture from 60% to 75% as it continues to outperform our expected goals,” said Philip W. Tomlinson, chairman and chief executive officer of TSYS.

“Our revised guidance for 2014 is included in the table below and is only adjusted for the discontinued Japan operations. TSYS’ previous revenue guidance included approximately $70 million of revenue associated with its operations in Japan for 2014, and $68 million in 2013. The financial impact from the sale of our businesses in Japan had no material impact on our previous guidance. Revenue and earnings growth ranges remain strong year over year, while adjusted cash EPS remained the same. Our revised guidance for 2014 reflects our focus on diversification, growth and the exceptional performance of our TSYS team,” said Tomlinson.

2014

TSYS Reports First Quarter 2014 Total Revenues Increased 32.1%/p.2

TSYS’ new guidance is as follows:

	2014 Revised Guidance
		Range
	(in millions, except per share amounts)					Percent Change
Total revenues	$	2,422	to	$	2,471		17	%	to	20	%
Revenues before reimbursable items	$	2,182	to	$	2,226		20	%	to	22	%
Adjusted EBITDA	$	732	to	$	746		17	%	to	20	%
Adjusted cash EPS attributable to TSYS common shareholders*	$	1.90	to	$	1.93		10	%	to	12	%
* Average Basic Weighted Shares		188.4

Conference Call

TSYS will host its quarterly conference call at 5:00 p.m. ET on Tuesday, April 22. The conference call can be accessed via simultaneous Internet broadcast at tsys.com by clicking on the link under “Webcasts” on the main homepage. The replay will be archived for 12 months and will be available approximately 30 minutes after the completion of the call. A slide presentation to accompany the call will be available by clicking on the link under “Webcasts” on the main homepage of tsys.com.

Non-GAAP Measures

This press release contains information prepared in conformity with GAAP as well as non-GAAP information. It is management’s intent to provide non-GAAP financial information to enhance understanding of its consolidated financial information as prepared in accordance with GAAP. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Each non-GAAP financial measure and the corresponding GAAP financial measure are presented so as not to imply that more emphasis should be placed on the non-GAAP measure. The non-GAAP financial information presented may be determined or calculated differently by other companies.

Additional information about non-GAAP financial measures and a reconciliation of those measures to the most directly comparable GAAP measures are included on pages 12 to 14 of this release.

2014

TSYS Reports First Quarter 2014 Total Revenues Increased 32.1%/p.3

About TSYS

At TSYS^® (NYSE: TSS), we believe payments should revolve around people, not the other way around. We call this belief “People-Centered Payments^®.” By putting people at the center of every decision we make, TSYS supports financial institutions, businesses and governments in more than 80 countries. Through NetSpend^®, A TSYS Company, we empower consumers with the convenience, security, and freedom to be self-banked. TSYS offers issuer services and merchant payment acceptance for credit, debit, prepaid, healthcare and business solutions.

TSYS’ headquarters are located in Columbus, Ga., U.S.A., with local offices spread across the Americas, EMEA and Asia-Pacific. TSYS is a member of The Civic 50 and was named one of the 2013 World’s Most Ethical Companies by Ethisphere magazine. TSYS routinely posts all important information on its website. For more, please visit us at www.tsys.com.

Forward-Looking Statements

This press release contains “forward-looking statements” – that is, statements related to future, not past, events. Forward-looking statements often address our expected future business and financial performance and often contain words such as “expect,” “anticipate,” “intend,” “believe,” “should,” “plan,” “potential,” “will,” “could,” and similar expressions. These forward-looking statements include, among others, statements regarding TSYS’ earnings guidance for 2014 total revenues, revenues before reimbursable items, adjusted EBITDA, and adjusted cash EPS, and the assumptions underlying such statements. These statements are based on the current beliefs and expectations of TSYS’ management, are based on management’s assumptions 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 or events 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, TSYS’ ability to integrate NetSpend and other acquisitions and achieve the anticipated growth opportunities and other benefits of the acquisitions; the effect of current domestic and worldwide economic conditions; the material breach of security of any of TSYS’ systems; risks associated with foreign operations, including adverse developments with respect to foreign currency exchange rates; expenses are incurred associated with the signing of a significant client; the deconversion of a significant client; changes occur in laws, rules, regulations, credit card association rules, the prepaid industry or other industry standards affecting TSYS and our clients that may result in costly new compliance burdens on TSYS and our clients and lead to a decrease in the volume and/or number of transactions processed; the costs and effects of litigation, investigations or similar matters or adverse facts and developments relating thereto; adverse developments with respect to the payment card industry in general, including a decline in the use of cards as a payment mechanism; and growth rates of TSYS’ existing clients are lower than anticipated or attrition rates of existing clients are higher than anticipated. Additional risks and other factors that could cause actual results or events to differ materially from those contemplated in this release can be found in TSYS’ filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-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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2014

TSYS Announces First Quarter 2014 Earnings

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TSYS

Financial Highlights

(unaudited)

(in thousands, except per share data)

	Three Months Ended March 31,
	2014			2013			Percent Change
Total revenues	$	592,848			448,791			32.1	%
Cost of services		422,883			304,369			38.9
Selling, general and administrative expenses		87,963			66,421			32.4
Merger and acquisition expenses		1,305			3,481			(62.5	)
Operating income		80,697			74,520			8.3
Nonoperating income (expenses)		(324	)		1,003			nm
Merger and acquisition expenses - bridge loan facility & other financing		(9,489	)		(2,743	)		nm
Income before income taxes, noncontrolling interests and equity in income of equity investments		70,884			72,780			(2.6	)
Income taxes		24,335			17,463			39.4
Income before noncontrolling interests and equity in income of equity investments		46,549			55,317			(15.9	)
Equity in income of equity investments		4,096			3,817			7.3
Income from continuing operations, net of tax		50,645			59,134			(14.4	)
Income from discontinued operations, net of tax		980			15			nm
Net income		51,625			59,149			(12.7	)
Net income attributable to noncontrolling interests		(2,322	)		(2,121	)		(9.5	)
Net income attributable to TSYS common shareholders	$	49,303			57,028			(13.5	)%
Basic earnings per share:
Income from continuing operations to TSYS common shareholders*	$	0.26			0.31			(15.3	)%
Loss from discontinued operations to TSYS common shareholders*		(0.00	)		(0.00	)		97.9
Basic earnings per share (EPS)	$	0.26			0.31			(14.0	)%
Diluted earnings per share:
Income from continuing operations to TSYS common shareholders*	$	0.26			0.31			(15.8	)%
Loss from discontinued operations to TSYS common shareholders*		(0.00	)		(0.00	)		97.9
Diluted EPS	$	0.26			0.30			(14.6	)%
Dividends declared per share	$	0.10			0.10
Amounts attributable to TSYS common shareholders:
Income from continuing operations, net of tax	$	49,321			57,905			(14.8	)%
Loss from discontinued operations, net of tax		(18	)		(877	)		97.9
Net income	$	49,303			57,028			(13.5	)%
Non-GAAP measures:
Adjusted cash EPS from continuing operations	$	0.38			0.38			(1.1	)%
Adjusted EBITDA	$	149,596			123,446			21.	2%

nm = not meaningful

* EPS amounts may not total due to rounding.

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TSYS Announces First Quarter 2014 Earnings

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TSYS

Consolidated Statements of Comprehensive Income

(unaudited)

(in thousands)

	Three Months Ended March 31,
	2014			2013
Net income	$	51,625			59,149
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		1,581			(12,646	)
Postretirement healthcare plan adjustments		(75	)		155
Unrealized gain on available-for-sale securities		570			—
Other comprehensive income (loss)		2,076			(12,491	)
Comprehensive income		53,701			46,658
Comprehensive income attributable to noncontrolling interests		2,827			467
Comprehensive income attributable to TSYS common shareholders	$	50,874			46,191

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TSYS Announces First Quarter 2014 Earnings

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TSYS

Earnings Per Share

(unaudited)

(in thousands, except per share data)

	Three Months Ended March 31, 2014					Three Months Ended March 31, 2013
	Common Stock			Participating Securities		Common Stock			Participating Securities
Basic earnings per share:
Net income	$	49,303					57,028
Less income allocated to nonvested awards		(516	)		516		(209	)		209
Net income allocated to common stock for EPS calculation ( a )	$	48,787			516		56,819			209
Average common shares outstanding ( b )		185,763			1,989		186,108			699
Average common shares and participating securities		187,752					186,807
Basic earnings per share ( a )/( b )	$	0.26			0.26		0.31			0.30
Diluted earnings per share:
Net income	$	49,303					57,028
Less income allocated to nonvested awards		(512	)		512		(208	)		208
Net income allocated to common stock for EPS calculation ( c )	$	48,791			512		56,820			208
Average common shares outstanding		185,763			1,989		186,108			699
Increase due to assumed issuance of shares related to common equivalent shares outstanding		2,632					1,274
Average common and common equivalent shares outstanding ( d )		188,395			1,989		187,382			699
Average common and common equivalent shares and participating securities		190,384					188,081
Diluted earnings per share ( c )/( d )	$	0.26			0.26		0.30			0.30

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TSYS Announces First Quarter 2014 Earnings

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TSYS

Segment Breakdown

(unaudited)

(in thousands)

	Three Months Ended March 31,
							Change
	2014			2013			$			%
Revenues before reimbursable items
North America Services	$	224,368			205,596			18,772			9.1	%
International Services		76,773			76,387			386			0.5
Merchant Services		104,625			109,301			(4,676	)		(4.3	)
NetSpend		132,640			—			132,640			na
Intersegment revenues		(5,656	)		(3,252	)		(2,404	)		(73.9	)
Revenues before reimbursable items from external customers	$	532,750			388,032			144,718			37.3	%
Total revenues
North America Services	$	262,178			239,789			22,389			9.3	%
International Services		82,378			80,891			1,487			1.8
Merchant Services		122,690			132,901			(10,211	)		(7.7	)
NetSpend		132,640			—			132,640			na
Intersegment revenues		(7,038	)		(4,790	)		(2,248	)		(46.9	)
Revenues from external customers	$	592,848			448,791			144,057			32.1	%
Depreciation and amortization
North America Services	$	20,276			18,083			2,193			12.1	%
International Services		9,805			10,699			(894	)		(8.4	)
Merchant Services		3,400			3,142			258			8.2
NetSpend		1,735			—			1,735			na
Segment depreciation and amortization		35,216			31,924			3,292			10.3
Acquisition intangible amortization		24,313			8,532			15,781			nm
Corporate admin and other		506			396			110			27.8
Total depreciation and amortization	$	60,035			40,852			19,183			47.0	%
Adjusted segment operating income
North America Services	$	74,578			68,748			5,830			8.5	%
International Services		4,555			6,861			(2,306	)		(33.6	)
Merchant Services		30,168			37,636			(7,468	)		(19.8	)
NetSpend		28,717			—			28,717			na
Total adjusted segment operating income		138,018			113,245			24,773			21.9
Acquisition intangible amorization		(24,313	)		(8,532	)		(15,781	)		nm
NetSpend M&A operating expenses (non-recurring)		(1,253	)		(3,481	)		2,228			64.0
Share-based compensation		(7,611	)		(4,593	)		(3,018	)		(65.7	)
Corporate admin and other		(24,144	)		(22,119	)		(2,025	)		(9.2	)
Operating income	$	80,697			74,520			6,177			8.3	%
Other:
Reimbursable items:
North America Services	$	37,810			34,193			3,617			10.6	%
International Services		5,605			4,504			1,101			24.4
Merchant Services		18,065			23,600			(5,535	)		(23.5	)
NetSpend		—			—			—			na
Intersegment revenues		(1,382	)		(1,538	)		156			10.1
Reimbursable items	$	60,098			60,759			(661	)		(1.1	)%

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TSYS

Segment Breakdown

(unaudited)

(in thousands)

Other:
Volumes:	At						Change
FTEs (full-time equivalents)	3/31/2014			12/31/2013			$			%
North America Services		4,587			4,484			103			2.3	%
International Services		2,414			2,413			1			0.0
Merchant Services		1,595			1,599			(4	)		(0.3	)
NetSpend		508			470			38			8.1
Corporate Admin and Other		573			545			28			5.1
FTEs - Continuing Operations		9,677			9,511			166			1.7	%
Discontinued Operations		80			84			(4	)		(4.8	)
FTEs		9,757			9,595			162			1.7	%
Total assets (in thousands)
North America Services	$	3,247,258			3,215,333			31,925			1.0	%
International Services		410,902			417,379			(6,477	)		(1.6	)
Merchant Services		693,130			676,592			16,538			2.4
NetSpend		1,586,326			1,596,150			(9,824	)		(0.6	)
Intersegment assets		(2,219,689	)		(2,218,886	)		(803	)		(0.0	)
Total assets	$	3,717,927			3,686,568			31,359			0.9	%
	Three Months Ended March 31,
							Change
	2014			2013			Inc(Dec)			%
North America Segment:
Accounts on File (AOF) (in millions)		495.5			422.8			72.7			17.2	%
Transactions (in millions)		2,327.6			2,013.4			314.2			15.6	%
International Segment:
AOF (in millions)		60.7			55.7			5.0			9.0	%
Transactions (in millions)		517.9			434.0			83.9			19.3	%
Merchant Segment:
Point-of-sale Transactions (in millions)		982.2			1,099.1			(116.9	)		(10.6	)%
Dollar sales volume (in millions)	$	10,779.7		$	10,132.3		$	647.4			6.4	%
NetSpend Segment:
Gross Dollar Volume (in millions)	$	6,567.2		$	5,378.7		$	1,188.5			22.1	%
90-Day Active Cards (in thousands)		3,654.8			3,157.5			497.3			15.7
Direct Deposit 90-Day Active Cards (in thousands)		2,070.3			1,707.9			362.4			21.2
% of 90-Day Active Cards with Direct Deposit		56.6	%		54.1	%

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TSYS Announces First Quarter 2014 Earnings

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TSYS

Balance Sheet

(unaudited)

(in thousands)

	Mar 31, 2014			Dec 31, 2013
Assets
Current assets:
Cash and cash equivalents	$	274,161			247,700
Accounts receivable, net		267,787			255,773
Deferred income tax assets		12,477			14,158
Prepaid expenses and other current assets		89,810			95,109
Current assets of discontinued operations		43,614			41,193
Total current assets		687,849			653,933
Goodwill		1,539,758			1,541,574
Other intangible assets, net		462,027			481,419
Computer software, net		359,696			363,880
Property and equipment, net		261,097			259,968
Contract acquisition costs, net		195,706			184,828
Equity investments, net		96,533			94,133
Deferred income tax assets, net		3,903			3,972
Other assets		97,410			87,146
Long-Term assets of discontinued operations		13,948			15,715
Total assets	$	3,717,927			3,686,568
Liabilities
Current liabilities:
Accounts payable	$	49,722			33,651
Current portion of borrowings		34,320			34,257
Current portion of obligations under capital leases		10,625			22,662
Accrued salaries and employee benefits		28,188			38,339
Other current liabilities		195,708			159,170
Current liabilities of discontinued operations		6,675			9,136
Total current liabilities		325,238			297,215
Long-term borrowings, excluding current portion		1,419,742			1,428,251
Deferred income tax liabilities		229,649			228,727
Obligations under capital leases, excluding current portion		6,096			7,500
Other long-term liabilities		83,195			81,600
Long-term liabilities of discontinued operations		1,244			1,197
Total liabilities		2,065,164			2,044,490
Redeemable noncontrolling interest		23,918			39,652
Equity
Shareholders’ equity:
Common stock		20,279			20,279
Additional paid-in capital		145,429			165,841
Accumulated other comprehensive income, net		5,320			3,749
Treasury stock		(312,843	)		(326,996	)
Retained earnings		1,748,141			1,718,204
Total shareholders’ equity		1,606,326			1,581,077
Noncontrolling interests in consolidated subsidiaries		22,519			21,349
Total equity		1,628,845			1,602,426
Total liabilities and equity	$	3,717,927			3,686,568

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TSYS

Cash Flow

(unaudited)

(in thousands)

	Three Months Ended March 31,
	2014			2013
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	51,625			59,149
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in income of equity investments		(4,096	)		(3,817	)
Net gain on foreign currency		(425	)		(45	)
Depreciation and amortization		61,432			42,498
Amortization of debt issuance costs		452			2,860
Amortization of bond discount		94			—
Changes in fair value of private equity investments		(312	)		(1,227	)
Share-based compensation		7,611			4,593
Excess tax benefit from share-based compensation		(4,037	)		(536	)
Provisions for bad debt expense and billing adjustments		749			376
Charges for transaction processing provisions		1,826			4,160
Provision for fraud and other losses		9,639			—
Deferred income tax expense		4,751			9,442
Loss on disposal of equipment, net		2			55
Changes in operating assets and liabilities:
Accounts receivable		(11,418	)		(30,182	)
Prepaid expenses, other current assets and other long-term assets		(3,170	)		(32,247	)
Accounts payable		15,738			5,745
Accrued salaries and employee benefits		(9,986	)		(9,266	)
Other current liabilities and other long-term liabilities		28,231			879
Net cash provided by operating activities		148,706			52,437
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment, net		(13,641	)		(6,481	)
Additions to licensed computer software from vendors		(5,963	)		(29,904	)
Additions to internally developed computer software		(9,735	)		(5,297	)
Purchase of private equity investments		(822	)		(411	)
Additions to contract acquisition costs		(17,903	)		(13,666	)
Net cash used in investing activities		(48,064	)		(55,759	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term borrowings and capital lease obligations		(22,277	)		(9,784	)
Proceeds from exercise of stock options		9,539			2,551
Excess tax benefit from share-based compensation		4,037			536
Repurchase of common stock under plans and tax withholding		(5,173	)		(5,501	)
Debt issuance costs		—			(3,534	)
Purchase of noncontrolling interests		(37,500	)		—
Subsidiary dividends paid to noncontrolling shareholders		(2,312	)		(953	)
Dividends paid on common stock		(18,788	)		—
Net cash used in financing activities		(72,474	)		(16,685	)
CASH AND CASH EQUIVALENTS:
Effect of exchange rate changes on cash and cash equivalents		1,015			(4,508	)
Net increase in cash and cash equivalents		29,183			(24,515	)
Cash and cash equivalents at beginning of period		278,230			247,612
Cash and cash equivalents at end of period		307,413			223,097
Less cash and cash equivalents of discontinued operations at end of period		33,252			22,324
Cash and cash equivalents of continuing operations at end of period	$	274,161			200,773

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TSYS Announces First Quarter 2014 Earnings

Page 11 of 16

Supplemental Information:

	Accounts on File
	Total
(in millions)	March 2014		March 2013		% Change
Consumer Credit		234.8		203.7		15.3
Retail		27.5		25.2		9.3
Total Consumer		262.3		228.9		14.6
Commercial		40.4		37.9		6.7
Other		19.7		13.4		46.5
Subtotal		322.4		280.2		15.1
Prepaid/Stored Value		120.0		107.3		11.8
Government Services		63.0		59.4		6.1
Commercial Card Single Use		50.8		31.6		60.8
Total AOF		556.2		478.5		16.2

Growth in Accounts on File (in millions):

	March 2013 to March 2014			March 2012 to March 2013
Beginning balance		478.5			415.5
Change in accounts on file due to:
Internal growth of existing clients		38.6			32.2
New clients		64.6			77.1
Purges/Sales		(24.7	)		(44.6	)
Deconversions		(0.8	)		(1.7	)
Ending balance		556.2			478.5

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TSYS Announces First Quarter 2014 Earnings

Page 12 of 16

Reconciliation of GAAP to Non-GAAP Financial Measures

Non-GAAP Measures

The schedule below provides a reconciliation of revenues and operating results on a constant currency basis to reported revenues and operating income. This non-GAAP measure presents first quarter 2014 financial results using the previous year’s foreign currency exchange rates. On a full year constant currency basis, TSYS’ total revenues grew 31.1% as compared to a reported GAAP increase of 32.1%.

The schedule below also provides a reconciliation of basic EPS, adjusted for the after-tax impact of acquisition intangible amortization, share-based compensation and merger and acquisition costs, to adjusted cash EPS.

The tax rate used in the calculation of cash EPS for the quarter and year is equal to an estimate of our annual effective tax rate on GAAP income. This effective rate is estimated annually and may be adjusted during the year to take into account events or trends that materially impact the effective tax rate including, but not limited to, significant changes resulting from tax legislation, material changes in the mix of revenues and expenses by entity and other signifcant events.

The schedule also provides a reconciliation of net income, adjusted for equity in income of equity investments, income taxes, nonoperating expense, depreciation and amortization, share-based compensation, and merger and acquisition expenses, to adjusted EBITDA.

TSYS believes that non-GAAP financial measures are important to enable investors to understand and evaluate its ongoing operating results. Accordingly, TSYS includes non-GAAP financial measures when reporting its financial results to shareholders and investors in order to provide them with an additional tool to evaluate TSYS’ ongoing business operations. TSYS believes that the non-GAAP financial measures are representative of comparative financial performance that reflects the economic substance of TSYS’ current and ongoing business operations.

Although non-GAAP financial measures are often used to measure TSYS’ operating results and assess its financial performance, they are not necessarily comparable to similarly titled captions of other companies due to potential inconsistencies in the method of calculation.

TSYS believes that its use of non-GAAP financial measures provides investors with the same key financial performance indicators that are utilized by management to assess TSYS’ operating results, evaluate the business and make operational decisions on a prospective, going-forward basis. Hence, management provides disclosure of non-GAAP financial measures to give shareholders and potential investors an opportunity to see TSYS as viewed by management, to assess TSYS with some of the same tools that management utilizes internally and to be able to compare such information with prior periods. TSYS believes that the presentation of GAAP financial measures alone would not provide its shareholders and potential investors with the ability to appropriately analyze its ongoing operational results, and therefore expected future results. TSYS therefore believes that inclusion of non-GAAP financial measures provides investors with additional information to help them better understand its financial statements just as management utilizes these non-GAAP financial measures to better understand the business, manage budgets and allocate resources.

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TSYS Announces First Quarter 2014 Earnings

Page 13 of 16

Reconciliation of GAAP to Non-GAAP

Constant Currency Comparison

(unaudited)

(in thousands)

	Three Months Ended March 31,
	2014		2013		Percent Change
Consolidated
Constant currency (1)	$	588,485		448,791		31.1	%
Foreign currency (2)		4,363		—
Total revenues	$	592,848		448,791		32.1	%
Constant currency (1)	$	528,701		388,032		36.3	%
Foreign currency (2)		4,049		—
Total revenues before reimbursable items	$	532,750		388,032		37.3	%
Constant currency (1)	$	78,152		74,520		4.9	%
Foreign currency (2)		2,545		—
Operating income	$	80,697		74,520		8.3	%
International Services
Constant currency (1)	$	78,134		80,891		(3.4	)%
Foreign currency (2)		4,244		—
Total revenues	$	82,378		80,891		1.8	%

(1) Reflects current period results on a non-GAAP basis as if foreign currency rates did not change from the comparable prior year period.

(2) Reflects the impact of calculated changes in foreign currency rates from the comparable period.

Revenues Before Reimbursable Items

(unaudited)

(in thousands)

	Three Months Ended March 31,
	2014		2013		Percent Change
Total revenues	$	592,848		448,791		32.1	%
Reimbursable items		60,098		60,759		(1.1	)
Revenues before reimbursable items	$	532,750		388,032		37.3	%

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TSYS Announces First Quarter 2014 Earnings

Page 14 of 16

Reconciliation of GAAP to Non-GAAP

Adjusted Cash Earnings

(unaudited)

(in thousands, except per share data)

	Three Months Ended March 31,
	2014		2013		Percent Change
Income from continuing operations attributable to TSYS common shareholders	$	49,321		57,905		(14.8	)%
Adjust for amounts attributable to TSYS common shareholders:
Add: Acquisition intangible amortization, net of taxes		15,813		5,492		nm	%
Add: Share-based compensation, net of taxes		5,017		3,148		59.4	%
Cash earnings		70,151		66,545		5.4	%
Add: NetSpend M&A expenses, net of taxes* (non-recurring)		1,204		5,222		(76.9	)%
Cash earnings adjusted	$	71,355		71,767		(0.6	)%
Basic EPS - Income from continuing operations attributable to TSYS common shareholders
As reported (GAAP)	$	0.26		0.31		(15.3	)%
Adjust for amounts attributable to TSYS common shareholders:
Add: Acquisition intangible amortization, net of taxes		0.08		0.03		nm	%
Add: Share-based compensation, net of taxes		0.03		0.02		58.0	%
Cash earnings per share		0.37		0.36		4.9	%
Add: NetSpend M&A expenses, net of taxes* (non-recurring)		0.01		0.03		(77.1	)%
Adjusted cash EPS **	$	0.38		0.38		(1.1	)%
Average common shares and participating securities		187,752		186,807

* Certain merger and acquisition costs are nondeductible for income tax purposes

** Adjusted cash EPS amounts may not total due to rounding.

Adjusted EBITDA

(unaudited)

(in thousands)

	Three Months Ended March 31,
	2014			2013			Percent Change
Net income	$	51,625			59,149			(12.7	)%
Adjust for:
Deduct: Income from discontinued operations		(980	)		(15	)		nm	%
Deduct: Equity in income of equity investments		(4,096	)		(3,817	)		(7.3	)%
Add: Income taxes		24,335			17,463			39.4	%
Add: Nonoperating expense		9,813			1,740			nm	%
Add: Depreciation and amortization		60,035			40,852			47.0	%
EBITDA		140,732			115,372			22.0	%
Adjust for:
Add: Share-based compensation		7,611			4,593			65.7	%
Add: NetSpend M&A operating expenses *(non-recurring)		1,253			3,481			(64.0	)%
Adjusted EBITDA	$	149,596			123,446			21.2	%

nm = not meaningful

* Excludes share-based compensation

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TSYS Announces First Quarter 2014 Earnings

Page 15 of 16

TSYS

Financial Highlights

(unaudited)

(in thousands, except per share data)

													Twelve Months Ended
	Three Months Ended
	March 31,			June 30,			Sept 30,			Dec 31,			Dec 31,
	2013			2013			2013			2013			2013
Total revenues	$	448,791			461,860			570,551			583,103			2,064,305
Cost of services		304,369			301,627			377,147			386,295			1,369,438
Selling, general and administrative expenses		66,421			64,345			81,643			85,739			298,147
Merger and acquisition expenses		3,481			1,246			7,282			2,211			14,220
Operating income		74,520			94,642			104,479			108,858			382,500
Nonoperating income (expenses)		1,003			(590	)		(499	)		(718	)		(804	)
Merger and acquisition expenses - bridge loan facility & other financing		(2,743	)		(6,934	)		(9,789	)		(9,754	)		(29,220	)
Income before income taxes, noncontrolling interests and equity in income of equity investments		72,780			87,118			94,191			98,386			352,476
Income taxes		17,463			29,984			30,100			33,435			110,982
Income before noncontrolling interests and equity in income of equity investments		55,317			57,134			64,091			64,951			241,494
Equity in income of equity investments		3,817			2,748			2,792			3,691			13,048
Income from continuing operations, net of tax		59,134			59,882			66,883			68,642			254,542
income from discontinued operations, net of tax		15			678			611			751			2,055
Net income		59,149			60,560			67,494			69,393			256,597
Net income attributable to noncontrolling interests		(2,121	)		(2,844	)		(3,144	)		(3,738	)		(11,847	)
Net income attributable to TSYS common shareholders	$	57,028			57,716			64,350			65,655			244,750
Basic earnings per share:
Income from continuing operations to TSYS common shareholders*	$	0.31			0.31			0.34			0.35			1.31
Loss from discontinued operations to TSYS common shareholders*		(0.00	)		(0.00	)		(0.00	)		(0.00	)		(0.01	)
Basic earnings per share (EPS)	$	0.31			0.31			0.34			0.35			1.30
Diluted earnings per share:
Income from continuing operations to TSYS common shareholders*	$	0.31			0.31			0.34			0.34			1.30
Loss from discontinued operations to TSYS common shareholders*		(0.00	)		(0.00	)		(0.00	)		(0.00	)		(0.01	)
Diluted EPS	$	0.30			0.31			0.34			0.34			1.29
Dividends declared per share	$	0.10			0.10			0.10			0.10			0.40
Amounts attributable to TSYS common shareholders:
Income from continuing operations, net of tax	$	57,905			58,096			64,834			66,058			246,893
Loss from discontinued operations, net of tax		(877	)		(380	)		(484	)		(403	)		(2,143	)
Net income	$	57,028			57,716			64,350			65,655			244,750
Non-GAAP measures:
Adjusted cash EPS from continuing operations	$	0.38			0.37			0.49			0.48			1.72
Adjusted EBITDA	$	123,446			140,105			179,445			181,097			624,093

Note: Prior periods restated for discontinued operations.

nm = not meaningful

* EPS amounts may not total due to rounding.

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TSYS Announces First Quarter 2014 Earnings

Page 16 of 16

TSYS

Segment Breakdown

(unaudited)

(in thousands)

													Twelve Months Ended
	Three Months Ended
	Mar 31, 2013			Jun 30, 2013			Sep 30, 2013			Dec 31, 2013			Dec 31, 2013
Revenues before reimbursable items
North America Services	$	205,596			214,526			217,257			223,266			860,645
International Services		76,387			76,626			77,876			90,595			321,484
Merchant Services		109,301			112,952			113,650			110,375			446,278
NetSpend		—			—			103,706			104,144			207,850
Intersegment revenues		(3,252	)		(3,175	)		(3,001	)		(3,121	)		(12,549	)
Revenues before reimbursable items from external customers	$	388,032			400,929			509,488			525,259			1,823,708
Total revenues
North America Services	$	239,789			248,640			252,577			259,067			1,000,073
International Services		80,891			81,504			83,025			96,129			341,549
Merchant Services		132,901			136,458			135,616			128,075			533,050
NetSpend		—			—			103,706			104,144			207,850
Intersegment revenues		(4,790	)		(4,742	)		(4,373	)		(4,312	)		(18,217	)
Revenues from external customers	$	448,791			461,860			570,551			583,103			2,064,305
Depreciation and amortization
North America Services	$	18,083			18,213			18,764			19,420			74,480
International Services		10,699			9,450			9,585			11,974			41,708
Merchant Services		3,142			2,998			2,890			3,004			12,034
NetSpend		—			—			1,470			1,651			3,121
Segment depreciation and amortization		31,924			30,661			32,709			36,049			131,343
Acquisition intangible amortization		8,532			7,879			24,731			24,751			65,893
Corporate admin and other		395			466			461			468			1,790
Total depreciation and amortization	$	40,851			39,006			57,901			61,268			199,026
Adjusted segment operating income
North America Services	$	68,748			81,318			84,443			87,110			321,619
International Services		6,861			7,693			9,528			17,986			42,068
Merchant Services		37,636			41,302			40,753			35,952			155,643
NetSpend		—			—			34,616			31,737			66,353
Total adjusted segment operating income		113,245			130,313			169,340			172,785			585,683
Acquisition intangible amorization		(8,532	)		(7,879	)		(24,732	)		(24,751	)		(65,894	)
NetSpend M&A operating expenses (non-recurring)		(3,481	)		(1,246	)		(7,282	)		(2,211	)		(14,220	)
Share-based compensation		(4,593	)		(5,211	)		(9,784	)		(9,345	)		(28,933	)
Corporate admin and other		(22,119	)		(21,334	)		(23,063	)		(27,620	)		(94,136	)
Operating income	$	74,520			94,643			104,479			108,858			382,500
Other:
Reimbursable items:
North America Services	$	34,193			34,114			35,320			35,801			139,428
International Services		4,504			4,878			5,149			5,534			20,065
Merchant Services		23,600			23,506			21,966			17,700			86,772
NetSpend		—			—			—			—			—
Intersegment revenues		(1,538	)		(1,567	)		(1,372	)		(1,191	)		(5,668	)
Reimbursable items	$	60,759			60,931			61,063			57,844			240,597

Note: prior periods restated for discontinued operations and the reclassification of all share-based compensation as corporate adminstration costs

- ### -

EX-99.2

2014 First Quarter Results

April 22, 2014

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

Exhibit 99.2

Forward-Looking Statements

2

This 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 subject to

risks, uncertainties and changes in circumstances.  Forward-looking

statements include all statements that are not historical facts and can be

identified by the use of forward-looking terminology such as the words

“believe,”

“expect,”

“anticipate,”

“intend,”

“plan,”

“potential”, “estimate”

or

similar expressions.  Actual results may differ materially from those set forth

in the forward-looking statements due to a variety of factors.  More

information about these risks, uncertainties and factors may be found in

TSYS’

filings with the Securities and Exchange Commission, including its

2013 Annual Report on Form 10-K.  TSYS does not assume any obligation

to update any forward-looking statements as a result of new information,

future developments or otherwise.

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

Use of Non-GAAP Financial Measures

3

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

This slide presentation contains 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: revenues before reimbursable items; operating margin excluding

reimbursable items; revenues measured on a constant currency basis; free

cash flow; EBITDA, adjusted EBITDA , adjusted cash earnings per share,

adjusted

segment

operating

income

and

adjusted

segment

operating

margin.

The most comparable GAAP measures to these measures are revenues;

operating margin; revenues; cash flows from operating activities; net income;

net income; earnings per share, operating income and operating margin,

respectively. Management uses these non-GAAP financial measures to assess

the performance of TSYS’

core business. TSYS believes that these non-GAAP

financial measures provide meaningful additional information about TSYS to

assist investors in evaluating TSYS’

operating results. These non-GAAP

financial measures should not be considered as a substitute for operating

results determined in accordance with GAAP and may not be comparable to

other similarly titled measures of other companies. The computations of the

non-GAAP financial measures used in this slide presentation are set forth in the

Appendix to this slide presentation.

Phil Tomlinson

Chairman and Chief Executive Officer

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

Troy Woods

President & Chief Operating Officer

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

1Q 2014 North America Segment Highlights

6

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

($ in millions)

(*) Revenues Before Reimbursable Items

($ in millions)

3.4%

(1.3%)

1.9%

0.8%

4.4%

4.5%

6.8%

Adjusted Segment Operating Income

Operating Margin*

73%

23%

4%

(1)

Includes Credit, Debit,

Retail, Prepaid & Loyalty

(2)

Includes Healthcare

9.1%

Improving Revenue Growth

6th Straight Positive Growth Quarter

Adjusted Segment Operating Income Up 8.5%

Adjusted Operating Margin: 33.2%

Chase License Payments Expired

Increased Incentive Pay

Market Salary Adjustments

$205.6

$203.5

$213.6

$205.6

$214.5

$217.3

$223.3

$224.4

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Segment

Revenue*

YOY Growth %

$73.4

$71.5

$81.2

$68.7

$81.3

$84.4

$87.1

$74.6

35.7%

35.2%

38.0%

33.4%

37.9%

38.9%

39.0%

33.2%

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Consumer (1)

Commercial (2)

Other

Segment Revenue by Line of Business*

1Q 2014 North America Segment Highlights

7

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

*

(in millions)

(in millions)

7.2%

3.4%

5.5%

5.2%

6.3%

16.2%

16.5%

18.0%

20.9%

20.9%

16.9%

11.2%

11.6%

13.4%

12.1%

9.5%

12.7%

7.8%

11.5%

17.6%

13.4%

15.6%

17.2%

17.1%

Thirteenth Straight Quarter of Account On File YOY Growth

Large Account Conversion Pipeline

Sixteenth Straight Quarter of Transaction YOY Growth

Same Client Transactions Up 12.9%: Eighteenth Straight Quarter of YOY Growth

387.3

413.4

424.8

422.8

430.7

461.4

481.9

495.5

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Accounts on File

YOY Growth%

2,003.8

2,036.6

2,194.7

2,013.4

2,235.0

2,395.8

2,488.2

2,327.6

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Transaction Volume

YOY Growth%

(*) Growth

Excluding

Prepaid,

Government

Services

and

Single

Use

Accounts

5%

6%

1Q 2014 International Segment Highlights

8

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

($ in millions)

Reported

Constant

Currency

(*) Revenues Before Reimbursable Items

($ in millions)

Adjusted Segment Operating Income

Operating Margin*

5.6%

1.4%

1.1%

(2.6%)

(4.0%)

0.7%

9.6%

4.4%

0.1%

(0.9%)

3.1%

9.0%

8.6%

89%

0.5%

(4.6%)

Revenue $76.8M* –

Up 0.5%

Down 4.6% on Constant Currency

Currency Tailwinds

Continued Margin Improvement Focus

Reemphasis on Accelerating Growth

Japan Market Divestitures

(NOTE: International numbers restated for Japan discontinued operations

(1.0%)

$79.8

$77.3

$83.1

$76.4

$76.6

$77.9

$90.6

$76.8

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Segment

Revenue*

YOY Growth %

$9.2

$6.8

$7.0

$6.9

$7.7

$9.5

$18.0

$4.6

11.5%

8.9%

8.4%

9.0%

10.0%

12.2%

19.9%

5.9%

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Segment Revenue by Region

QTD

1Q 2014 International Segment Highlights

9

©2014 Total System Services, Inc.®

Proprietary. All rights reserved worldwide.

(in millions)

(in millions)

11.6%

5.7%

4.1%

3.7%

9.9%

12.1%

8.5%

18.1%

15.9%

19.5%

14.2%

23.3%

26.7%

17.3%

8.9%

19.3%

Strong AOF Growth, Despite Some Client Purging

Irish Debit AOF Grew By 71.2%

Double-digit Transaction Growth of 19.3%

Same Client Transaction Growth of 17.3%

52.8

52.9

54.5

55.7

58.0

59.2

59.1

60.7

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Accounts on File

YOY Growth%

399.2

414.6

473.6

434.0

492.4

525.5

555.6

517.9

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Transaction Volume

YOY Growth%

Anniversary of Acquisitions

Completed Clearing and Settlement

Conversion

Direct Revenue Mix Holds at 57%

Expanded CPAY Ownership to 75%

1Q 2014 Merchant Segment Highlights

10

©2014

Total

System

Services,

Inc.®

Proprietary.

All

rights

reserved

worldwide.

(*) Revenues Before Reimbursable Items

($ in millions)

5.0%

15.6%

5.5%

11.1%

15.6%

5.4%

4.3%

Adjusted Segment Operating Income

Operating Margin*

($ in millions)

(4.3%)

Segment Revenue*

YOY Growth %

$39.6%

38.2%

35.6%

34.4%

36.6%

35.9%

32.6%

28.8%

Segment Revenue by Mix*

QTD

57%

43%

$97.7

$107.8

$105.9

$109.3

$113.0

$113.6

$110.4

$104.6

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

$38.7

$41.1

$37.7

$37.6

$41.3

$40.8

$36.0

$30.2

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Direct

Indirect

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11

1Q 2014 Merchant Segment Highlights

(*) Excludes Managed Accounts

Segment Revenue by LOB

($ in billions)

12.3%

23.0%

32.2%

35.3%

40.6%

22.0%

11.1%

(12%)

45%

55%

26%

22%

(11%)

(12%)

(12%)

($ in millions)

4%

(14%)

9.3%

Direct Revenues Up 4.2%

Indirect Revenues Down 13.5%

POS Transactions Increased 2.7%, Excluding Deconverted Accounts

High Single-digit Direct Small Business Sales Volume Growth

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

$3.8

$4.4

$4.7

$4.8

$5.3

$5.3

$5.2

$5.3

SBS Sales Volume*

YOY Growth %

YOY Growth %

Indirect

Direct

$58

$58

$55

$52

$51

$51

$48

$45

$40

$50

$51

$57

$62

$63

$62

$59

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Segment Revenue

YOY Growth %

1Q 2014 NetSpend Segment Highlights

12

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($ in millions)

Revenue $132.6M –

up 13.1%

Added 2k Retail Locations

Added 70+ New PayCard Clients

Announced PayChex and Western Union

Partnerships

($ in millions)

(*NOTE: Periods prior to the acquisition by TSYS have been restated )

$25.7

$24.9

$23.9

$28.0

$29.3

$34.6

$31.7

$28.7

30.1%

29.4%

26.7%

23.9%

27.9%

33.4%

30.5%

21.7%

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

$85.3

$84.9

$89.7

$117.3

$104.9

$103.7

$104.1

$132.6

14.7%

14.2%

16.9%

28.3%

22.9%

22.2%

16.1%

13.1%

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Partner

Retail

Direct

Paycard

Segment Revenue by Channel

QTD

8%

52%

28%

12%

Adjusted Segment Operating Income*

Operating Margin*

1Q 2014 NetSpend Segment Highlights

13

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Gross Dollar Volume

YOY Growth %

Direct Deposit Active Cards

YOY Growth %

Direct Deposit Active Cards up 21.2%

Exceeded 2M for the first time in history

Gross Dollar Volume (GDV) up 22.1%

Record Tax Season

(in thousands)

($ in millions)

24.2%

24.8%

25.1%

66.7%

42.3%

23.8%

22.1%

17.1%

17.9%

18.2%

42.8%

30.1%

22.4%

21.2%

21.5%

22.1%

957.0

1,018.5

1,081.6

1,707.9

1,361.4

1,261.1

1,321.1

2,070.3

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

$3,034.7

$3,089.8

$3,265.4

$5,378.7

$3,947.9

$3,780.9

$3,967.6

$6,567.2

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

Jim Lipham

Chief Financial Officer

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Consolidated Selected Financial Highlights

15

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Total Revenues

$592,848

$448,791

32.1%

Revenues Before Reimbursable Items

532,750

388,032

37.3

Adjusted EBITDA*

149,596

123,446

21.2

Adjusted Cash EPS* from Continuing

Operations

$0.38

$0.38

(1.1)

1

st

Qtr

2014

1

st

Qtr

2013

Percent

Change

(in thousands, except per share data)

(*) Adjusted Cash EPS and Adjusted EBITDA definitions are contained in Appendix

Revenues before

Reimbursable

Items

Adjusted

Operating Margin

Adjusted

Segment

Operating Income

North America

$74,578

$224,368

33.24%

International

4,555

76,773

5.93%

Merchant

30,168

104,625

28.83%

NetSpend

28,717

132,640

21.65%

Eliminations

--

(5,656)

Corporate administration excluding stock comp

(24,144)

--

Adjusted operating margin

$113,874

$532,750

21.37%

Amortization of acquisition intangibles

(24,313)

NetSpend M&A expenses

(1,253)

Stock-based compensation

(7,611)

Operating income (US GAAP)

$80,697

Segment Operating Margin and Consolidated

Adjusted Operating Margin

(in thousands)

16

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Three Months Ended March 31, 2014

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Rollforward of Quarterly Cash Balance

$200

$500

$100

$0

$300

Beginning

Balance

$248

Operating

Activities

$149

Cap Ex

($47)

Debt Pmts

($22)

Dividends

($19)

Acquisition

($38)

Other

$3

Ending Balance

$274

(in millions)

12/31/2013

3/31/2014

17

$400

Cash Flow Strength:

2014 TTM Consolidated Financial Highlights

18

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TTM = Trailing Twelve Months

(in millions)

$650

$549

$363

$249

$274

$0

$75

$150

$225

$300

$375

$450

$525

$600

$675

$750

Adjusted EBITDA

Cash flow from operations

Free cash flow

Net income

Ending cash

2014 Revised Guidance*

Range

Range

Percent Change

Total Revenues

$2,422

to

$2,471

17%

to

20%

Revenues Before Reimbursable Items

$2,182

to

$2,226

20%

to

22%

Adjusted EBITDA

$732

to

$746

17%

to

20%

Adjusted Cash EPS from continuing

operations

$1.90

to

$1.93

10%

to

12%

Average Basic Weighted Shares

188.4

(in millions, except per share data)

19

(*) See Appendix for guidance assumptions

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System

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Q&A

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System

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Appendix

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Appendix: Non-GAAP Items –

Adjusted EBITDA

and Adjusted Cash EPS

•

Adjusted EBITDA is net income excluding equity in income of equity investments, nonoperating income/(expense), taxes, depreciation,

amortization and stock-based compensation expenses and other non-recurring items.

•

Adjusted cash EPS is adjusted cash earnings divided by weighted average shares outstanding used for basic EPS calculations. Adjusted

cash earnings is net income excluding the after-tax impact of stock-based compensation expenses, amortization of acquisition intangibles,

and other non-recurring items.

•

Adjusted segment operating income is operating income at the segment level adjusted for acquisition intangible amortization.

•

Adjusted segment operating margin is adjusted segment operating income divided by segment revenues before reimbursable items.

•

The Company believes that these non-GAAP financial measures it presents are useful to investors in evaluating the Company’s operating

performance for the following reasons:

–

adjusted EBITDA and adjusted cash EPS are widely used by investors to measure a company’s operating performance without regard to items,

such as interest expense, income tax expense, depreciation and amortization, merger and acquisition expenses and employee stock-based

compensation

expense

that

can

vary

substantially

from

company

to

company

depending

upon

their

respective

financing

structures

and

accounting policies, the book values of their assets, their capital structures and the methods by which their assets were acquired; and

–

securities

analysts

use

adjusted

EBITDA

and

adjusted

cash

EPS

as

supplemental

measures

to

evaluate

the

overall

operating

performance

of

companies.

•

By comparing the Company’s adjusted EBITDA and adjusted cash EPS in different historical periods, investors can evaluate the

Company’s operating results without the additional variations caused by employee stock-based compensation expense, which may not be

comparable from period to period due to changes in the fair market value of the Company’s common stock (which is influenced by external

factors like the volatility of public markets and the financial performance of the Company’s peers) and is not a key measure of the

Company’s operations.

•

The Company’s management uses the non-GAAP financial measures:

–

as measures of operating performance, because they exclude the impact of items not directly resulting from the Company’s core operations;

–

for planning purposes, including the preparation of the Company’s annual operating budget;

–

to allocate resources to enhance the financial performance of the Company’s business;

–

to evaluate the effectiveness of the Company’s business strategies; and

–

in communications with the Company’s board of directors concerning the Company’s financial performance.

©2014 Total System Services, Inc.®

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22

Consumer Credit

234.8

203.7

15.3

234.8

228.9

2.6

Retail

27.5

25.2

9.3

27.5

27.8

(0.9

)

Total Consumer

262.3

228.9

14.6

262.3

256.7

2.2

Commercial

40.4

37.9

6.7

40.4

39.9

1.2

Other

19.7

13.4

46.5

19.7

18.9

4.4

Subtotal

322.4

280.2

15.1

322.4

315.5

2.2

Prepaid */

Stored Value

120.0

107.3

11.8

120.0

118.0

1.7

Government

Services

63.0

59.4

6.1

63.0

62.2

1.1

Commercial Card

Single Use

50.8

31.6

60.8

50.8

45.3

12.2

Total AOF

556.2

478.5

16.2

556.2

541.0

2.8

Appendix: Accounts on File Portfolio Summary

(in millions)

Mar

2014

Mar

2013

%

Change

Mar

2014

Dec

2013

%

Change

23

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(* -

Prepaid does not include NetSpend accounts)

Appendix: Non-GAAP Reconciliation –

Revenues Before Reimbursable Items

Three Months Ended

03/31/14                03/31/13

Total Revenues

$592,848

$448,791

Reimbursable Items

60,098

60,759

$532,750

$388,032

(in thousands)

24

©2014 Total System Services, Inc.®

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Revenues before Reimbursable Items

Appendix: Non-GAAP Reconciliation –

Adjusted

Segment Operating Income and Operating Margin

Three Months Ended

Operating income

$80,697

$74,520

Add: Acquisition intangible amort

24,313

8,532

Add: Corporate admin and other

33,008

30,193

Total segment adjusted operating income

$138,018

$113,245

By segment: North America services (a)

$74,578

$68,748

International services (b)

$4,555

$6,861

Merchant services (c)

$30,168

$37,636

NetSpend (d)

$28,717

$--

Total revenues

$592,848

$448,791

Reimbursable items

(60,098)

(60,759)

Total segment revenues before reimbursable items

$532,750

$388,032

Intersegment revenues

5,656

3,252

By segment: North America services (e)

$224,368

$205,596

International services (f)

$76,773

$76,387

Merchant services (g)

$104,625

$109,301

NetSpend (h)

$132,640

$--

Adjusted segment operating margin:

North America services (a) / (e)

33.24%

33.44%

International services (b) / (f)

5.93%

8.98%

Merchant services (c) / (g)

28.83%

34.43%

NetSpend (d) / (h)

21.65%

na

(in thousands)

25

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3/31/14

3/31/13

Three

Months Ended

3/31/14        3/31/13

Percentage

Change

Appendix: Non-GAAP Reconciliation –

Constant Currency

(1) Reflects current period results on a non-GAAP basis as if foreign currency rates did not change from the comparable prior year period.

(2) Reflects the impact of calculated changes in foreign currency rates from the comparable period.

(in thousands)

Consolidated:

Constant Currency (1)

$588,485

$448,791

31.1%

Foreign Currency (2)

4,363

---

Total Revenues

$592,848

$448,791

32.1%

International Services:

Constant Currency (1)

$78,134

$80,891

(3.4%)

Foreign Currency (2)

4,244

---

Total Revenues

$82,378

$80,891

1.8%

26

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Three

Months Ended

3/31/14       3/31/13

Percentage

Change

Appendix: Non-GAAP Reconciliation –

Constant Currency

(1) Reflects current period results on a non-GAAP basis as if foreign currency rates did not change from the comparable prior year period.

(2) Reflects the impact of calculated changes in foreign currency rates from the comparable period.

(in thousands)

27

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Consolidated:

Constant Currency (1)

$528,701

$388,032

36.3%

Foreign Currency (2)

4,049

---

Revenues before

reimbursable items

$532,750

$388,032

37.3%

International Services:

Constant Currency (1)

$72,843

$76,387

(4.6%)

Foreign Currency (2)

3,930

---

Revenues before

reimbursable items

$76,773

$76,387

0.5%

Appendix: Non-GAAP Reconciliation –

EBITDA and Adjusted EBITDA

(in thousands)

28

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Three Months Ended

Mar

2014

Mar

2013

Net income :

As reported (GAAP) (a)

$51,625

$59,149

Adjusted for:

Deduct: Income from discontinued operations

(980)

(15)

Deduct: Equity in Income of Equity Investments

(4,096)

(3,817)

Add: Income Taxes

24,335

17,463

Add: Nonoperating expenses

9,813

1,740

Add: Depreciation and amortization

60,035

40,852

EBITDA

$140,732

$115,372

Adjust for:

Add: Share-based compensation

7,611

4,593

Add: NetSpend  M&A expenses

1,253

3,481

Adjusted EBITDA

$149,596

$123,446

Appendix: Non-GAAP Reconciliation –

Adjusted Cash EPS

(in thousands)

29

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Three Months Ended

Mar

2014

Mar

2013

Income from continuing operations available to

TSYS common shareholders:

As reported (GAAP) (a)

$49,321

$57,905

Adjusted for amounts attributable to TSYS

common shareholders (net of taxes):

Acquisition intangible amortization

15,813

5,492

Share-based compensation

5,017

3,148

Cash earnings

$70,151

$66,545

NetSpend M&A expenses (nonrecurring)

1,204

5,222

Adjusted cash earnings (b)

$71,355

$71,767

Average common shares outstanding and

participating securities (c)

187,752

186,807

Basic EPS from continuing operations available

to TSYS common shareholders (a) / (c)

$0.26

$0.31

Adjusted cash EPS Available to TSYS common

shareholders (b) / (c)

$0.38

$0.38

Appendix: Non-GAAP Reconciliation –

EBITDA and Adjusted EBITDA

Trailing

Twelve Months

Ended

3/31/2014

Net Income

$249,074

Adjusted for:

Deduct: Discontinued operations

(3,021)

Deduct: Equity in Income of Equity Investments

(13,327)

Add: Income Taxes

218,210

Add: Nonoperating expense

38,097

Add: Depreciation and Amortization

117,854

EBITDA

$606,886

Adjust for: Share-based compensation

31,950

NetSpend M&A Operating Expenses*

11,406

Adjusted EBITDA

$650,243

(in thousands)

30

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* Excludes share-based compensation

Appendix: Non-GAAP Reconciliation –

Free Cash Flow

Trailing

Twelve Months

Ended

3/31/2014

Cash Flows from Operating Activities

$548,668

Less:

Purchase of Property and Equipment

(47,757)

Additions to Licensed Computer Software from Vendors

(40,788)

Additions to Internally Developed Computer Software

(36,944)

Additions to Contract Acquisition Costs

(60,202)

Free Cash Flow

$362,977

(in thousands)

31

©2014 Total System Services, Inc.®

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Appendix: 2014 Guidance Assumptions

The guidance assumes:

32

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•

There will be no significant movements in the London Interbank Offered

rate and TSYS will not make any significant draws on the remaining

balance of its credit facility;

•

There will be no significant movement in foreign currency exchange rates

related to TSYS’

business;

•

TSYS will not incur significant expenses associated with the conversion of

new large clients other than included in the 2014 estimate, additional

acquisitions,

or

any

significant

impairment

of

goodwill

or

other

intangibles;

•

There will be no deconversions of large clients during the year;

•

There will be minimal synergies from the NetSpend acquisition for 2014;

and

•

The economy will not worsen.