Absorbing the biggest acquisition in its history, credit-card and electronic payment processor TSYS on Tuesday reported a first-quarter profit of $57 million, or 31 cents share.
That compares to net income of $56.3 million, or 30 cents per share, in the January-March period a year ago.
“Our issuer processing business had strong same client transaction growth of 8.7 percent in the quarter,” TSYS Chairman and CEO Phil Tomlinson said in a statement, ticking off the quarter’s high points.
“Excluding deconverted clients in the indirect merchant business, point-of-sale transactions increased 6.6 percent and sales volume in the direct merchant business was up 15.5 percent, including acquisitions,” he said. “Also contributing to our strong results was our consolidated internal revenue growth of 3.9 percent, excluding the Bank of America Merchant Services deconversion, combined with acquisitions in the acquiring space, which added 4.4 percent to our growth in revenues before reimbursable items.”
Columbus-based TSYS pointed out its $1.4 billion purchase of Austin, Texas-based NetSpend is on track for completion this summer. NetSpend is a company that specializes in offering prepaid debit cards to “underbanked customers.”
“Merger and acquisition expenses associated with the pending acquisition of NetSpend were $6.2 million in the quarter,” said Tomlinson. Without those costs, the company said, earnings per share would have been around 33 cents.
But that still was a penny lower than stock market analysts surveyed by Thomson Financial were anticipating from the company that does business in North America, Latin America, Europe and the Asia-Pacific region.
The company’s profit numbers came on total revenue of nearly $465 million in the quarter. That’s slightly higher than the $461.1 million it racked up in the same period a year ago.
Overall, the company’s employee headcount rose to 8,552 in the quarter, up by 349 positions from the end of 2012. Its North America, Merchant Services and corporate administration areas saw increases, while International Services was down by 375 positions, or nearly 14 percent.
The total number of accounts processed by the company came in at 478 million, up from 416 million a year ago. That should rise as TSYS completes its conversion of a major Bank of America contract it secured last year. It hasn’t released the number of accounts that business will bring, however.
TSYS released its earnings report after the New York Stock Exchange’s final bell Tuesday. Shares were up 23 cents, or just under 1 percent, at $24.24.