Total System Services Earnings: Net Income Still Weak

S&P 500 (NYSE:SPY) component Total System Services, Inc. (NYSE:TSS) reported its results for the first quarter. Total System Services Inc. is a payment solutions provider company. It offers electronic payment processing, merchant services and related services to financial and non-financial institutions globally.

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Total System Services Earnings Cheat Sheet for the First Quarter

Results: Net income for Total System Services, Inc. fell to $49.4 million (25 cents/share) vs. $51.3 million (26 cents/share) a year earlier. A decline of 3.7% from the year earlier quarter.

Revenue: Rose 3.4% to $429.4 million YoY.

Actual vs. Wall St. Expectations: TSS fell right in step with the street’s estimates of 25 cents/share.

Quoting Management: “The economic momentum generated during the last two quarters continues to move us forward, and has reinforced our enthusiasm for 2011. Our same-client cardholder transaction volumes increased 9.6%, marking the sixth consecutive quarter of growth. Organic revenue growth continues to improve with the first quarter at 3.9%. We believe we are in-line to achieve our financial guidance for 2011,” said Philip W. Tomlinson, chairman of the board and chief executive officer of TSYS.

Key Stats:

Net income has dropped 7.8% year over year on average across the last five quarters. Performance was hurt by a 21.7% decline in the fourth quarter of the last fiscal year from the year earlier quarter.

Gross margins grew 0.1 percentage point to 29.8%. The growth seemed to be driven by increased revenue, as the figure rose 3.4% from the year earlier quarter while costs rose 3.2%.

Over the last five quarters, revenue has increased 2.3% on average year over year. The biggest increase came in the second quarter of the last fiscal year, when revenue rose 5.3% from the year earlier quarter.

Competitors to Watch: Visa Inc. (NYSE:V), Fidelity National Information Services (NYSE:FIS), MasterCard Incorporated (NYSE:MA), Cass Information Systems (NASDAQ:CASS), NetSpend Holdings Inc (NASDAQ:NTSP), Fiserv, Inc. (NASDAQ:FISV), MoneyGram Intl., Inc. (NYSE:MGI), ACI Worldwide Inc (NASDAQ:ACIW), Banks.com Inc (AMEX:BNX), and Intl. Business Machines Corp. (NYSE:IBM).

Today’s Performance: Shares of TSS closed up 0.21% from yesterday’s close at $19.10.

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