* Q1 EPS $0.26 vs est. EPS $0.23
* Q1 merchant services revenue up 18 pct
* Sees FY 2010 EPS from cont ops at $0.96-$0.98
* Shares up 3 pct after the bell
(Recasts; adds conference call details, background, updates
BANGALORE, April 20 Payment processor TSYS
(TSS.N) reported quarterly profit above market view, helped
partly by higher revenue from the merchant services segment,
and raised its fiscal 2010 outlook above estimates. For the
full year, the payment processor now expects earnings from
continuing operations of between 96 cents and 98 cents a share.
It sees revenue in the range of $1.71 billion to $1.75 billion
Analysts were expecting earnings of 95 cents a share on
revenue of $1.63 billion for fiscal 2010, according to Thomson
The company said it revised its fiscal 2010 earnings and
revenue outlook to reflect its acquisition of a 51 percent
interest in First National Bank of Omaha's FINNB.UL merchant
acquiring business to form a joint venture that will offer
transaction processing and merchant support to North American
For 2010, TSYS expects its joint venture First National
Merchant Solutions LLC to contribute $95 million to $97 million
to total revenue, $2 million to $3 million to net income and
about a cent to basic earnings per share.
The company said on a post-earnings call that it incurred a
severance-related expense of $1.5 million during the first
In January, TSYS said it reduced its overall workforce by
about 5 percent in 2009, and plans to cut about the same number
of jobs in 2010.
The company expects strong improvement in growth in 2011,
and said it is seeing some improvement in the consumer market.
For the first quarter, net income was $51.3 million, or 26
cents a share, compared with $46.5 million, or 24 cents a
share, last year.
Total revenue rose 2 percent to $415.4 million, with
merchant services revenue rising 18 percent to $89.2 million.
Analysts on average were looking for a profit of 23 cents a
share, before items, on revenue of $407.2 million.
Shares of the company were up 3 percent at $16.98 in
trading after the bell. They closed at $16.50 Tuesday on the
New York Stock Exchange.
(Reporting by Abhinav Sharma and Brenton Cordeiro in
Bangalore; Editing by Unnikrishnan Nair)