DENVER--(BUSINESS WIRE)--The Western Union Company (the "Company" or "Western Union") (NYSE: WU) today reported third quarter 2024 financial results.
The Company's third-quarter revenue of $1.04 billion decreased 6% on a reported basis. The revenue decline was driven by lower contribution from Iraq compared to the prior year period, which negatively impacted the revenue growth rate by 7 percentage points, partially offset by growth in Branded Digital and Consumer Services.
"We are pleased with third quarter results, which demonstrate continued progress of our Evolve 2025 strategy," said Devin McGranahan, President and Chief Executive Officer. "We've maintained mid-single digit transaction growth in our Consumer Money Transfer business for five quarters in a row and are now seeing the effect on revenue, with positive adjusted consolidated revenue growth for two consecutive quarters, excluding Iraq."
GAAP EPS in the third quarter was $0.78 compared to $0.46 in the prior year period. Adjusted EPS was $0.46 compared to $0.43 in the prior year period. GAAP EPS in the current period included a benefit of $0.40 from a settlement with the U.S. Internal Revenue Service regarding the Company's 2017 and 2018 federal income tax returns. Adjusted EPS in the current period benefited from lower share count and a lower adjusted effective tax rate, partially offset by a lower contribution from Iraq.
Q3 Business Results
- The Company's Consumer Money Transfer (CMT) segment revenue decreased 9% on a reported basis and 8% on an adjusted basis, while transactions increased 3% compared to the prior period. The revenue decline was driven by lower contribution from Iraq.
- Branded Digital revenue increased 8% on a reported basis or 9% on an adjusted basis with transaction growth of 15%. The Branded Digital business represented 25% and 32% of total CMT revenues and transactions, respectively.
- Consumer Services segment revenue grew 32% on a reported basis and 15% on an adjusted basis, benefiting from new and expanded products led by the expansion of the Company's retail foreign exchange business and the addition of the Company's newly launched media network business, as well as the continued strength of the retail money order business.
Q3 Financial Results
- GAAP operating margin in the quarter was 15.9%, compared to 19.2% in the prior year period, while the adjusted operating margin was 19.1% compared to 19.6% in the prior year period. GAAP operating margin in the current period included redeployment program costs and Russia asset impairments and termination costs. Adjusted operating margins decreased due to a lower contribution from Iraq and strategic investments in new and expanded products in Consumer Services.
- The GAAP effective tax rate in the quarter was a benefit of 95.2%, compared to a provision of 16.3% in the prior year period. The adjusted effective tax rate in the quarter was a provision of 8.4%, compared to a provision of 16.6% in the prior year period. The decrease in the GAAP effective rate was primarily related to the IRS settlement, partially offset by the effects of the sale of the Company's Business Solutions business in the prior periods. The decrease in the adjusted effective tax rate was primarily due to discrete tax benefits.
2024 Outlook
The Company revised its GAAP operating margin and EPS outlook to include the impact related to redeployment program costs, Russia asset impairments and termination costs, and the IRS settlement. The Company reiterated its full year 2024 adjusted outlook based on performance. The outlook assumes no material changes in macroeconomic conditions.
2024 Outlook | ||
GAAP | Adjusted | |
Revenue1 | $4,125 to $4,200 | $4,150 to $4,225 |
Operating Margin | 17% to 19% | 19% to 21% |
EPS2 | $1.94 to $2.04 | $1.70 to $1.80 |
1 In millions, adjusted revenue excludes the impact of currency and Argentina inflation | ||
2 The adjusted effective tax rate is expected to be in the low teens range | ||
Non-GAAP Measures
Western Union presents a number of non-GAAP financial measures because management believes that these metrics provide meaningful supplemental information in addition to the GAAP metrics and provide comparability and consistency to prior periods. Constant currency results assume foreign revenues are translated from foreign currencies to the U.S. dollar, net of the effect of foreign currency hedges, at rates consistent with those in the prior year. The Company estimates Argentina inflation as the revenue growth not attributable to either transaction growth or the change in price (revenue divided by principal).
Reconciliations of non-GAAP to comparable GAAP measures are available in the accompanying schedules and in the "Investor Relations" section of the Company's website at https://ir.westernunion.com.
Additional Statistics
Additional key statistics for the quarter and historical trends can be found in the supplemental tables included with this press release. All amounts included in the supplemental tables to this press release are rounded to the nearest tenth of a million, except as otherwise noted. As a result, the percentage changes and margins disclosed herein may not recalculate precisely using the rounded amounts provided.
Environmental, Social, and Governance (ESG)
Western Union is committed to making a positive impact. For more details on how Western Union is addressing some of the most pressing issues facing society, our shared environment, and our Company, please view our latest ESG report: https://corporate.westernunion.com/esg.
Investor and Analyst Conference Call and Presentation
The Company will host a conference call and webcast at 4:30 p.m. ET today.
The webcast and presentation will be available at https://ir.westernunion.com. Registration for the event is required, so please register at least 15 minutes prior to the scheduled start time. A webcast replay will be available shortly after the event.
To listen to the conference call via telephone in the U.S., dial +1 (719) 359-4580 15 minutes prior to the start of the call, followed by the webinar ID, which is 947 6420 1357, and the passcode, which is 330235, or follow this link. To listen to the conference call via telephone outside the U.S., dial the country number from the international directory, followed by the webinar ID, which is 947 6420 1357, and the passcode, which is 330235.
Safe Harbor Compliance Statement for Forward-Looking Statements
This press release contains certain statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions that are difficult to predict. Actual outcomes and results may differ materially from those expressed in, or implied by, our forward-looking statements. Words such as "expects," "intends," "targets," "anticipates," "believes," "estimates," "guides," "provides guidance," "provides outlook," "projects," "designed to," and other similar expressions or future or conditional verbs such as "may," "will," "should," "would," "could," and "might" are intended to identify such forward-looking statements. Readers of this press release of The Western Union Company (the "Company," "Western Union," "we," "our," or "us") should not rely solely on the forward-looking statements and should consider all uncertainties and risks discussed in the Risk Factors section and throughout the Annual Report on Form 10-K for the year ended December 31, 2023. The statements are only as of the date they are made, and the Company undertakes no obligation to update any forward-looking statement.
Possible events or factors that could cause results or performance to differ materially from those expressed in our forward-looking statements include the following: (i) events related to our business and industry, such as: changes in general economic conditions and economic conditions in the regions and industries in which we operate, including global economic downturns and trade disruptions, or significantly slower growth or declines in the money transfer, payment service, and other markets in which we operate, including downturns or declines related to interruptions in migration patterns or other events, such as public health emergencies, epidemics, or pandemics, civil unrest, war, terrorism, natural disasters, or non-performance by our banks, lenders, insurers, or other financial services providers; failure to compete effectively in the money transfer and payment service industry, including among other things, with respect to price or customer experience, with global and niche or corridor money transfer providers, banks and other money transfer and payment service providers, including digital, mobile and internet-based services, card associations, and card-based payment providers, and with digital currencies and related exchanges and protocols, and other innovations in technology and business models; geopolitical tensions, political conditions and related actions, including trade restrictions and government sanctions, which may adversely affect our business and economic conditions as a whole, including interruptions of United States or other government relations with countries in which we have or are implementing significant business relationships with agents, clients, or other partners; deterioration in customer confidence in our business, or in money transfer and payment service providers generally; failure to maintain our agent network and business relationships under terms consistent with or more advantageous to us than those currently in place; our ability to adopt new technology and develop and gain market acceptance of new and enhanced services in response to changing industry and consumer needs or trends; mergers, acquisitions, and the integration of acquired businesses and technologies into our Company, divestitures, and the failure to realize anticipated financial benefits from these transactions, and events requiring us to write down our goodwill; decisions to change our business mix; changes in, and failure to manage effectively, exposure to foreign exchange rates, including the impact of the regulation of foreign exchange spreads on money transfers; changes in tax laws, or their interpretation, any subsequent regulation, and unfavorable resolution of tax contingencies; any material breach of security, including cybersecurity, or safeguards of or interruptions in any of our systems or those of our vendors or other third parties; cessation of or defects in various services provided to us by third-party vendors; our ability to realize the anticipated benefits from restructuring-related initiatives, which may include decisions to downsize or to transition operating activities from one location to another, and to minimize any disruptions in our workforce that may result from those initiatives; our ability to attract and retain qualified key employees and to manage our workforce successfully; failure to manage credit and fraud risks presented by our agents, clients, and consumers; adverse rating actions by credit rating agencies; our ability to protect our trademarks, patents, copyrights, and other intellectual property rights, and to defend ourselves against potential intellectual property infringement claims; material changes in the market value or liquidity of securities that we hold; restrictions imposed by our debt obligations; (ii) events related to our regulatory and litigation environment, such as: liabilities or loss of business resulting from a failure by us, our agents, or their subagents to comply with laws and regulations and regulatory or judicial interpretations thereof, including laws and regulations designed to protect consumers, or detect and prevent money laundering, terrorist financing, fraud, and other illicit activity; increased costs or loss of business due to regulatory initiatives and changes in laws, regulations and industry practices and standards, including changes in interpretations, in the United States and abroad, affecting us, our agents or their subagents, or the banks with which we or our agents maintain bank accounts needed to provide our services, including related to anti-money laundering regulations, anti-fraud measures, our licensing arrangements, customer due diligence, agent and subagent due diligence, registration and monitoring requirements, consumer protection requirements, remittances, immigration, and sustainability reporting including climate-related reporting; liabilities, increased costs or loss of business and unanticipated developments resulting from governmental investigations and consent agreements with, or investigations or enforcement actions by regulators and other government authorities; liabilities resulting from litigation, including class-action lawsuits and similar matters, and regulatory enforcement actions, including costs, expenses, settlements, and judgments; failure to comply with regulations and evolving industry standards regarding consumer privacy, data use, the transfer of personal data between jurisdictions, and information security, failure to comply with the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as regulations issued pursuant to it and the actions of the Consumer Financial Protection Bureau and similar legislation and regulations enacted by other governmental authorities in the United States and abroad related to consumer protection; effects of unclaimed property laws or their interpretation or the enforcement thereof; failure to maintain sufficient amounts or types of regulatory capital or other restrictions on the use of our working capital to meet the changing requirements of our regulators worldwide; changes in accounting standards, rules and interpretations, or industry standards affecting our business; and (iii) other events, such as catastrophic events and management's ability to identify and manage these and other risks.
About Western Union
The Western Union Company (NYSE: WU) is committed to helping people around the world who aspire to build financial futures for themselves, their loved ones and their communities. Our leading cross-border, cross-currency money movement, payments and digital financial services empower consumers, businesses, financial institutions and governments-across more than 200 countries and territories and over 130 currencies-to connect with billions of bank accounts, millions of digital wallets and cards, and a global footprint of hundreds of thousands of retail locations. Our goal is to offer accessible financial services that help people and communities prosper. For more information, visit www.westernunion.com.
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| THE WESTERN UNION COMPANY | |||||||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||
| (in millions, except per share amounts) | |||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||
2024 | 2023 | % Change | 2024 | 2023 | % Change | ||||||||||||||||
| Revenues | $ | 1,036.0 | $ | 1,097.8 | (6)% | $ | 3,151.5 | $ | 3,304.7 | (5)% | |||||||||||
| Expenses: | |||||||||||||||||||||
| Cost of services | 653.6 | 687.2 | (5)% | 1,958.8 | 2,015.6 | (3)% | |||||||||||||||
| Selling, general, and administrative | 217.5 | 199.7 | 9% | 645.0 | 630.9 | 2% | |||||||||||||||
| Total expenses | 871.1 | 886.9 | (2)% | 2,603.8 | 2,646.5 | (2)% | |||||||||||||||
| Operating income | 164.9 | 210.9 | (22)% | 547.7 | 658.2 | (17)% | |||||||||||||||
| Other income/(expense): | |||||||||||||||||||||
| Gain on divestiture of business (a) | - | 18.0 | (b) | - | 18.0 | (b) | |||||||||||||||
| Interest income | 2.8 | 3.6 | (23)% | 9.6 | 11.0 | (13)% | |||||||||||||||
| Interest expense | (32.2 | ) | (27.0 | ) | 19% | (89.4 | ) | (79.0 | ) | 13% | |||||||||||
| Other income/(expense), net | 0.2 | (1.2 | ) | (b) | 3.0 | (6.5 | ) | (b) | |||||||||||||
| Total other expense, net | (29.2 | ) | (6.6 | ) | (b) | (76.8 | ) | (56.5 | ) | 36% | |||||||||||
| Income before income taxes | 135.7 | 204.3 | (34)% | 470.9 | 601.7 | (22)% | |||||||||||||||
| Provision for/(benefit from) income taxes | (129.1 | ) | 33.3 | (b) | (77.6 | ) | 102.7 | (b) | |||||||||||||
| Net income | $ | 264.8 | $ | 171.0 | 55% | $ | 548.5 | $ | 499.0 | 10% | |||||||||||
| Earnings per share: | |||||||||||||||||||||
| Basic | $ | 0.78 | $ | 0.46 | 70% | $ | 1.61 | $ | 1.33 | 21% | |||||||||||
| Diluted | $ | 0.78 | $ | 0.46 | 70% | $ | 1.61 | $ | 1.33 | 21% | |||||||||||
| Weighted-average shares outstanding: | |||||||||||||||||||||
| Basic | 338.3 | 373.9 | 340.5 | 374.5 | |||||||||||||||||
| Diluted | 339.5 | 375.0 | 341.6 | 375.4 | |||||||||||||||||
| (a) | On July 1, 2023, the Company completed the final close of the sale of its Business Solutions business to Goldfinch Partners LLC and The Baupost Group LLC (collectively, the "Buyer"). | ||||||||||||||||||||
| (b) | Calculation not meaningful. | ||||||||||||||||||||
| THE WESTERN UNION COMPANY | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (Unaudited) | ||||||||
| (in millions, except per share amounts) | ||||||||
| September 30, | December 31, | |||||||
2024 | 2023 | |||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 1,097.6 | $ | 1,268.6 | ||||
| Settlement assets | 3,306.9 | 3,687.0 | ||||||
| Property and equipment, net of accumulated depreciation of $448.8 and $438.8, respectively | 86.7 | 91.4 | ||||||
| Goodwill | 2,061.4 | 2,034.6 | ||||||
| Other intangible assets, net of accumulated amortization of $592.9 and $685.9, respectively | 330.8 | 380.2 | ||||||
| Other assets | 792.4 | 737.0 | ||||||
| Total assets | $ | 7,675.8 | $ | 8,198.8 | ||||
| Liabilities and stockholders' equity | ||||||||
| Liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 426.0 | $ | 453.0 | ||||
| Settlement obligations | 3,306.9 | 3,687.0 | ||||||
| Income taxes payable | 261.8 | 659.5 | ||||||
| Deferred tax liability, net | 157.0 | 147.6 | ||||||
| Borrowings | 2,586.7 | 2,504.6 | ||||||
| Other liabilities | 284.7 | 268.1 | ||||||
| Total liabilities | 7,023.1 | 7,719.8 | ||||||
| Stockholders' equity: | ||||||||
| Preferred stock, $1.00 par value; 10 shares authorized; no shares issued | - | - | ||||||
| Common stock, $0.01 par value; 2,000 shares authorized; 337.8 shares and 350.5 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively | 3.4 | 3.5 | ||||||
| Capital surplus | 1,060.3 | 1,031.9 | ||||||
| Accumulated deficit | (269.5 | ) | (389.1 | ) | ||||
| Accumulated other comprehensive loss | (141.5 | ) | (167.3 | ) | ||||
| Total stockholders' equity | 652.7 | 479.0 | ||||||
| Total liabilities and stockholders' equity | $ | 7,675.8 | $ | 8,198.8 | ||||
| THE WESTERN UNION COMPANY | ||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| (Unaudited) | ||||||||
| (in millions) | ||||||||
| Nine Months Ended | ||||||||
| September 30, | ||||||||
2024 | 2023 | |||||||
| Cash flows from operating activities | ||||||||
| Net income | $ | 548.5 | $ | 499.0 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 135.7 | 138.5 | ||||||
| Gain on divestiture of business, excluding transaction costs | - | (18.0 | ) | |||||
| Other non-cash items, net | 89.3 | 64.7 | ||||||
| Increase/(decrease) in cash, excluding the effects of acquisitions and divestitures, resulting from changes in: | ||||||||
| Other assets | (55.8 | ) | (91.1 | ) | ||||
| Accounts payable and accrued liabilities | (34.0 | ) | (47.5 | ) | ||||
| Income taxes payable | (403.2 | ) | (60.0 | ) | ||||
| Other liabilities | (8.2 | ) | 33.0 | |||||
| Net cash provided by operating activities | 272.3 | 518.6 | ||||||
| Cash flows from investing activities | ||||||||
| Capital expenditures | (91.8 | ) | (117.2 | ) | ||||
| Purchases of settlement investments | (336.3 | ) | (382.0 | ) | ||||
| Proceeds from the sale of settlement investments | 176.6 | 207.6 | ||||||
| Maturities of settlement investments | 142.2 | 112.9 | ||||||
| Proceeds from the sale of non-settlement investments | - | 100.0 | ||||||
| Other investing activities | (24.8 | ) | 2.2 | |||||
| Net cash used in investing activities | (134.1 | ) | (76.5 | ) | ||||
| Cash flows from financing activities | ||||||||
| Cash dividends and dividend equivalents paid | (241.9 | ) | (266.0 | ) | ||||
| Common stock repurchased | (182.5 | ) | (97.1 | ) | ||||
| Net proceeds from/(repayments of) commercial paper | 80.1 | (10.0 | ) | |||||
| Principal payments on borrowings | - | (300.0 | ) | |||||
| Proceeds from exercise of options | - | 0.3 | ||||||
| Net change in settlement obligations | (151.3 | ) | (162.2 | ) | ||||
| Other financing activities | (1.2 | ) | - | |||||
| Net cash used in financing activities | (496.8 | ) | (835.0 | ) | ||||
| Net change in cash and cash equivalents, including settlement, and restricted cash | (358.6 | ) | (392.9 | ) | ||||
| Cash and cash equivalents, including settlement, and restricted cash at beginning of period | 1,786.2 | 2,040.7 | ||||||
| Cash and cash equivalents, including settlement, and restricted cash at end of period | $ | 1,427.6 | $ | 1,647.8 | ||||
| September 30, | ||||||||
2024 | 2023 | |||||||
| Reconciliation of balance sheet cash and cash equivalents to cash flows: | ||||||||
| Cash and cash equivalents on balance sheet | $ | 1,097.6 | $ | 1,138.2 | ||||
| Settlement cash and cash equivalents | 327.2 | 484.4 | ||||||
| Restricted cash in Other assets | 2.8 | 25.2 | ||||||
| Cash and cash equivalents, including settlement, and restricted cash at end of period | $ | 1,427.6 | $ | 1,647.8 | ||||
| THE WESTERN UNION COMPANY | |||||||||||||||||||||
| SUMMARY SEGMENT DATA | |||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||
| (in millions, unless indicated otherwise) | |||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||
2024 | 2023 | % Change | 2024 | 2023 | % Change | ||||||||||||||||
| Revenues: | |||||||||||||||||||||
| Consumer Money Transfer | $ | 932.2 | $ | 1,019.0 | (9)% | $ | 2,859.2 | $ | 3,029.5 | (6)% | |||||||||||
| Consumer Services | 103.8 | 78.8 | 32% | 292.3 | 245.5 | 19% | |||||||||||||||
| Business Solutions (a) | - | - | (f) | - | 29.7 | (f) | |||||||||||||||
| Total consolidated revenues | $ | 1,036.0 | $ | 1,097.8 | (6)% | $ | 3,151.5 | $ | 3,304.7 | (5)% | |||||||||||
| Segment operating income: | |||||||||||||||||||||
| Consumer Money Transfer | $ | 188.3 | $ | 193.4 | (3)% | $ | 567.4 | $ | 601.9 | (6)% | |||||||||||
| Consumer Services | 9.2 | 21.6 | (58)% | 38.9 | 72.1 | (46)% | |||||||||||||||
| Business Solutions (a) | - | - | (f) | - | 3.7 | (f) | |||||||||||||||
| Total segment operating income | 197.5 | 215.0 | (8)% | 606.3 | 677.7 | (11)% | |||||||||||||||
| Redeployment program costs (b) | (18.0 | ) | (4.1 | ) | (f) | (41.4 | ) | (19.5 | ) | (f) | |||||||||||
| Acquisition, separation, and integration costs (c) | (1.7 | ) | - | (f) | (2.3 | ) | - | (f) | |||||||||||||
| Amortization and impairment of acquisition-related intangible assets (d) | (0.2 | ) | - | (f) | (2.2 | ) | - | (f) | |||||||||||||
| Russia asset impairments and termination costs (e) | (12.7 | ) | - | (f) | (12.7 | ) | - | (f) | |||||||||||||
| Total consolidated operating income | $ | 164.9 | $ | 210.9 | (22)% | $ | 547.7 | 658.2 | (17)% | ||||||||||||
| Segment operating income margin | |||||||||||||||||||||
| Consumer Money Transfer | 20.2 | % | 19.0 | % | 1.2% | 19.8 | % | 19.9 | % | (0.1)% | |||||||||||
| Consumer Services | 8.7 | % | 27.5 | % | (18.8)% | 13.3 | % | 29.4 | % | (16.1)% | |||||||||||
| Business Solutions (a) | - | - | (f) | - | 12.4 | % | (f) | ||||||||||||||
(a) | On August 4, 2021, the Company entered into an agreement to sell its Business Solutions business. The sale was completed with the final closing on July 1, 2023. | ||||||||||||||||||||
(b) | Represented severance, expenses associated with streamlining the Company's organizational and legal structure, and other expenses associated with the Company's program which redeployed expenses in its cost base through optimizations in vendor management, real estate, marketing, and people strategy, as previously announced in October 2022. Expenses incurred under the program also included non-cash impairments of operating lease right-of-use assets and property and equipment. | ||||||||||||||||||||
(c) | Represents the impact from expenses incurred in connection with the Company's acquisition and divestiture activity, including for the review and closing of these transactions, and integration costs directly related to the Company's acquisitions. | ||||||||||||||||||||
(d) | Represents the incremental non-cash amortization and impairment of acquired intangible assets in connection with recent business acquisitions. | ||||||||||||||||||||
(e) | Represents asset impairments related to the Company's assets in Russia and the costs associated with operating the Russian entity. While the Company had previously made a decision to suspend its operations in Russia, in the third quarter of 2024, the Company decided to pursue either liquidating or selling the Russian assets, which triggered a review of the carrying value of these assets. | ||||||||||||||||||||
(f) | Calculation not meaningful. | ||||||||||||||||||||
| THE WESTERN UNION COMPANY | |||||||||||||||||||||||
| KEY STATISTICS | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Notes* | 3Q23 | 4Q23 | FY2023 | 1Q24 | 2Q24 | 3Q24 | YTD 3Q24 | ||||||||||||||||
| Consolidated Metrics | |||||||||||||||||||||||
| Revenues (GAAP) - YoY % change | 1% | (4)% | (3)% | 1% | (9)% | (6)% | (5)% | ||||||||||||||||
| Adjusted revenues (non-GAAP) - YoY % change | (a) | 4% | (1)% | 1% | 3% | (7)% | (6)% | (4)% | |||||||||||||||
| Adjusted revenues, excluding Iraq (non-GAAP) - YoY % change | (a) | (4)% | (4)% | (4)% | (1)% | 0% | 1% | 0% | |||||||||||||||
| Operating margin (GAAP) | 19.2% | 15.1% | 18.8% | 18.3% | 17.9% | 15.9% | 17.4% | ||||||||||||||||
| Adjusted operating margin (non-GAAP) | (b) | 19.6% | 16.1% | 19.6% | 19.7% | 19.0% | 19.1% | 19.2% | |||||||||||||||
| Consumer Money Transfer (CMT) Segment Metrics | |||||||||||||||||||||||
| Revenues (GAAP) - YoY % change | 4% | (1)% | 0% | 3% | (10)% | (9)% | (6)% | ||||||||||||||||
| Adjusted revenues (non-GAAP) - YoY % change | (g) | 3% | (1)% | 0% | 3% | (9)% | (8)% | (5)% | |||||||||||||||
| Transactions (in millions) | 70.6 | 72.9 | 279.4 | 69.0 | 73.3 | 72.6 | 214.9 | ||||||||||||||||
| Transactions - YoY % change | 5% | 5% | 2% | 6% | 4% | 3% | 4% | ||||||||||||||||
| Cross-border principal, as reported - YoY % change | 13% | 8% | 9% | 7% | (6)% | 0% | 0% | ||||||||||||||||
| Cross-border principal (constant currency) - YoY % change | (h) | 11% | 7% | 9% | 7% | (5)% | 0% | 0% | |||||||||||||||
| Operating margin | 19.0% | 15.3% | 18.7% | 19.5% | 19.8% | 20.2% | 19.8% | ||||||||||||||||
| Branded Digital revenues (GAAP) - YoY % change | (gg) | 3% | 4% | 0% | 9% | 5% | 8% | 7% | |||||||||||||||
| Branded Digital foreign currency translation and Argentina inflation impact | (k) | 0% | 0% | 0% | 0% | 2% | 1% | 1% | |||||||||||||||
| Adjusted Branded Digital revenues (non-GAAP) - YoY % change | (gg) | 3% | 4% | 0% | 9% | 7% | 9% | 8% | |||||||||||||||
| Branded Digital transactions - YoY % change | (gg) | 12% | 13% | 11% | 13% | 13% | 15% | 13% | |||||||||||||||
| CMT Segment Regional Metrics - YoY % change | |||||||||||||||||||||||
| NA region revenues (GAAP) | (aa), (bb) | (3)% | (1)% | (5)% | 2% | 1% | (3)% | 0% | |||||||||||||||
| NA region foreign currency translation impact | (k) | 0% | 0% | 0% | 0% | 0% | 0% | 0% | |||||||||||||||
| Adjusted NA region revenues (non-GAAP) | (aa), (bb) | (3)% | (1)% | (5)% | 2% | 1% | (3)% | 0% | |||||||||||||||
| NA region transactions | (aa), (bb) | 7% | 6% | 5% | 6% | 6% | 3% | 5% | |||||||||||||||
| EU & CIS region revenues (GAAP) | (aa), (cc) | (9)% | (8)% | (11)% | (5)% | (6)% | 0% | (4)% | |||||||||||||||
| EU & CIS region foreign currency translation impact | (k) | (1)% | (1)% | 0% | 0% | 2% | 1% | 2% | |||||||||||||||
| Adjusted EU & CIS region revenues (non-GAAP) | (aa), (cc) | (10)% | (9)% | (11)% | (5)% | (4)% | 1% | (2)% | |||||||||||||||
| EU & CIS region transactions | (aa), (cc) | 0% | 4% | (6)% | 5% | 3% | 6% | 5% | |||||||||||||||
| MEASA region revenues (GAAP) | (aa), (dd) | 42% | 12% | 31% | 16% | (35)% | (32)% | (21)% | |||||||||||||||
| MEASA region foreign currency translation impact | (k) | 0% | 0% | 1% | 1% | 0% | 1% | 1% | |||||||||||||||
| Adjusted MEASA region revenues (non-GAAP) | (aa), (dd) | 42% | 12% | 32% | 17% | (35)% | (31)% | (20)% | |||||||||||||||
| MEASA region transactions | (aa), (dd) | 9% | 7% | 6% | 6% | 0% | 0% | 2% | |||||||||||||||
| LACA region revenues (GAAP) | (aa), (ee) | 10% | 2% | 8% | 7% | 8% | (2)% | 4% | |||||||||||||||
| LACA region foreign currency translation and Argentina inflation impact | (k) | (5)% | (4)% | (3)% | (2)% | 0% | 1% | 0% | |||||||||||||||
| Adjusted LACA region revenues (non-GAAP) | (aa), (ee) | 5% | (2)% | 5% | 5% | 8% | (1)% | 4% | |||||||||||||||
| LACA region transactions | (aa), (ee) | 9% | 4% | 7% | 3% | 2% | (2)% | 1% | |||||||||||||||
| APAC region revenues (GAAP) | (aa), (ff) | (8)% | (7)% | (7)% | (10)% | (11)% | (2)% | (8)% | |||||||||||||||
| APAC region foreign currency translation impact | (k) | 1% | 2% | 2% | 4% | 6% | 3% | 5% | |||||||||||||||
| Adjusted APAC region revenues (non-GAAP) | (aa), (ff) | (7)% | (5)% | (5)% | (6)% | (5)% | 1% | (3)% | |||||||||||||||
| APAC region transactions | (aa), (ff) | 0% | 6% | 1% | 7% | 6% | 11% | 8% | |||||||||||||||
| % of CMT Revenue | |||||||||||||||||||||||
| NA region revenues | (aa), (bb) | 37% | 39% | 37% | 38% | 40% | 39% | 39% | |||||||||||||||
| EU & CIS region revenues | (aa), (cc) | 24% | 25% | 25% | 24% | 25% | 27% | 25% | |||||||||||||||
| MEASA region revenues | (aa), (dd) | 23% | 18% | 21% | 21% | 18% | 17% | 19% | |||||||||||||||
| LACA region revenues | (aa), (ee) | 11% | 12% | 11% | 12% | 12% | 11% | 12% | |||||||||||||||
| APAC region revenues | (aa), (ff) | 5% | 6% | 6% | 5% | 5% | 6% | 5% | |||||||||||||||
| Branded Digital revenues | (aa), (gg) | 21% | 23% | 22% | 23% | 24% | 25% | 24% | |||||||||||||||
| Consumer Services (CS) | |||||||||||||||||||||||
| Revenues (GAAP) - YoY % change | 22% | (1)% | 13% | 5% | 21% | 32% | 19% | ||||||||||||||||
| Adjusted revenues (non-GAAP) - YoY % change | (i) | 24% | 6% | 17% | 8% | 14% | 15% | 13% | |||||||||||||||
| Operating margin | 27.5% | 26.6% | 28.7% | 21.3% | 11.0% | 8.7% | 13.3% | ||||||||||||||||
| % of Total Company Revenue (GAAP) | |||||||||||||||||||||||
| Consumer Money Transfer segment revenues | 93% | 93% | 92% | 92% | 90% | 90% | 91% | ||||||||||||||||
| Consumer Services segment revenues | 7% | 7% | 7% | 8% | 10% | 10% | 9% | ||||||||||||||||
| Business Solutions segment revenues | 0% | 0% | 1% | 0% | 0% | 0% | 0% | ||||||||||||||||
| * See the "Notes to Key Statistics" section of the press release for the applicable Note references and the reconciliation of non-GAAP financial measures, unless already reconciled herein. | |||||||||||||||||||||||
| THE WESTERN UNION COMPANY | |||||||||||||||||||||||||||||||
| NOTES TO KEY STATISTICS | |||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||
| (in millions, unless indicated otherwise) | |||||||||||||||||||||||||||||||
| Western Union's management believes the non-GAAP financial measures presented within this press release and related tables provide meaningful supplemental information regarding the Company's results to assist management, investors, analysts, and others in understanding the Company's financial results and to better analyze operating, profitability, and other financial performance trends in the Company's underlying business because they provide consistency and comparability to prior periods or eliminate currency volatility, increasing the comparability of the Company's underlying results and trends. | |||||||||||||||||||||||||||||||
| A non-GAAP financial measure should not be considered in isolation or as a substitute for the most comparable GAAP financial measure. A non-GAAP financial measure reflects an additional way of viewing aspects of the Company's operations that, when viewed with the Company's GAAP results and the reconciliation to the corresponding GAAP financial measure, provides a more complete understanding of the Company's business. Users of the financial statements are encouraged to review the Company's financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. A reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures is included below, where not previously reconciled above. | |||||||||||||||||||||||||||||||
| Notes | 3Q23 | 4Q23 | FY2023 | 1Q24 | 2Q24 | 3Q24 | YTD 3Q24 | ||||||||||||||||||||||||
| Consolidated Metrics | |||||||||||||||||||||||||||||||
(a) | Revenues (GAAP) | $ | 1,097.8 | $ | 1,052.3 | $ | 4,357.0 | $ | 1,049.1 | $ | 1,066.4 | $ | 1,036.0 | $ | 3,151.5 | ||||||||||||||||
| Foreign currency translation and Argentina inflation impact | (k) | (5.9 | ) | 1.2 | 15.4 | 5.6 | 6.4 | (5.5 | ) | 6.5 | |||||||||||||||||||||
| Revenues, constant currency, net of Argentina inflation (non-GAAP) | 1,091.9 | 1,053.5 | 4,372.4 | 1,054.7 | 1,072.8 | 1,030.5 | 3,158.0 | ||||||||||||||||||||||||
| Less Business Solutions revenues, constant currency (non-GAAP) | (k), (n) | - | - | (29.9 | ) | - | - | - | - | ||||||||||||||||||||||
| Adjusted revenues (non-GAAP) | $ | 1,091.9 | $ | 1,053.5 | $ | 4,342.5 | $ | 1,054.7 | $ | 1,072.8 | $ | 1,030.5 | $ | 3,158.0 | |||||||||||||||||
| Less Iraq revenues (GAAP) | (t) | (86.8 | ) | (32.5 | ) | (263.0 | ) | (64.9 | ) | (34.3 | ) | (9.5 | ) | (108.7 | ) | ||||||||||||||||
| Adjusted revenues, excluding Iraq (non-GAAP) | $ | 1,005.1 | $ | 1,021.0 | $ | 4,079.5 | $ | 989.8 | $ | 1,038.5 | $ | 1,021.0 | $ | 3,049.3 | |||||||||||||||||
| Prior year revenues (GAAP) | $ | 1,089.6 | $ | 1,091.9 | $ | 4,475.5 | $ | 1,036.9 | $ | 1,170.0 | $ | 1,097.8 | $ | 3,304.7 | |||||||||||||||||
| Less prior year revenues from Business Solutions (GAAP) | (n) | (42.6 | ) | (29.5 | ) | (196.9 | ) | (15.4 | ) | (14.3 | ) | - | (29.7 | ) | |||||||||||||||||
| Adjusted prior year revenues (non-GAAP) | $ | 1,047.0 | $ | 1,062.4 | $ | 4,278.6 | $ | 1,021.5 | $ | 1,155.7 | $ | 1,097.8 | $ | 3,275.0 | |||||||||||||||||
| Less prior year revenues from Iraq (GAAP) | (t) | (3.7 | ) | (4.0 | ) | (15.1 | ) | (25.3 | ) | (118.4 | ) | (86.8 | ) | (230.5 | ) | ||||||||||||||||
| Adjusted prior year revenues, excluding Iraq (non-GAAP) | $ | 1,043.3 | $ | 1,058.4 | $ | 4,263.5 | $ | 996.2 | $ | 1,037.3 | $ | 1,011.0 | $ | 3,044.5 | |||||||||||||||||
| Revenues (GAAP) - YoY % change | 1 | % | (4 | )% | (3 | )% | 1 | % | (9 | )% | (6 | )% | (5 | )% | |||||||||||||||||
| Revenues, constant currency, net of Argentina inflation (non-GAAP) - YoY% change | 0 | % | (4 | )% | (2 | )% | 2 | % | (8 | )% | (6 | )% | (4 | )% | |||||||||||||||||
| Adjusted revenues (non-GAAP) - YoY % change | 4 | % | (1 | )% | 1 | % | 3 | % | (7 | )% | (6 | )% | (4 | )% | |||||||||||||||||
| Adjusted revenues, excluding Iraq (non-GAAP) - YoY % change | (4 | )% | (4 | )% | (4 | )% | (1 | )% | 0 | % | 1 | % | 0 | % | |||||||||||||||||
(b) | Operating income (GAAP) | $ | 210.9 | $ | 159.3 | $ | 817.5 | $ | 192.1 | $ | 190.7 | $ | 164.9 | $ | 547.7 | ||||||||||||||||
| Acquisition, separation, and integration costs | (m) | 0.5 | 0.2 | 3.1 | 0.1 | 0.5 | 1.7 | 2.3 | |||||||||||||||||||||||
| Amortization and impairment of acquisition-related intangible assets | (p) | - | - | - | - | 2.0 | 0.2 | 2.2 | |||||||||||||||||||||||
| Redeployment program costs | (o) | 4.1 | 10.0 | 29.5 | 14.0 | 9.4 | 18.0 | 41.4 | |||||||||||||||||||||||
| Russia asset impairments and termination costs | (r) | - | - | - | - | - | 12.7 | 12.7 | |||||||||||||||||||||||
| Less Business Solutions operating income | (n) | - | - | (3.6 | ) | - | - | - | - | ||||||||||||||||||||||
| Adjusted operating income (non-GAAP) | $ | 215.5 | $ | 169.5 | $ | 846.5 | $ | 206.2 | $ | 202.6 | $ | 197.5 | $ | 606.3 | |||||||||||||||||
| Operating margin (GAAP) | 19.2 | % | 15.1 | % | 18.8 | % | 18.3 | % | 17.9 | % | 15.9 | % | 17.4 | % | |||||||||||||||||
| Adjusted operating margin (non-GAAP) | 19.6 | % | 16.1 | % | 19.6 | % | 19.7 | % | 19.0 | % | 19.1 | % | 19.2 | % | |||||||||||||||||
(c) | Net income (GAAP) | $ | 171.0 | $ | 127.0 | $ | 626.0 | $ | 142.7 | $ | 141.0 | $ | 264.8 | $ | 548.5 | ||||||||||||||||
| Acquisition, separation, and integration costs | (m) | 0.5 | 0.2 | 3.1 | 0.1 | 0.5 | 1.7 | 2.3 | |||||||||||||||||||||||
| Amortization and impairment of acquisition-related intangible assets | (p) | - | - | - | - | 2.0 | 0.2 | 2.2 | |||||||||||||||||||||||
| Business Solutions gain | (n) | (18.0 | ) | - | (18.0 | ) | - | - | - | - | |||||||||||||||||||||
| Redeployment program costs | (o) | 4.1 | 10.0 | 29.5 | 14.0 | 9.4 | 18.0 | 41.4 | |||||||||||||||||||||||
| Russia asset impairments, termination costs, and currency remeasurement | (r) | - | - | - | - | - | 13.7 | 13.7 | |||||||||||||||||||||||
| IRS settlement | (s) | - | - | - | - | - | (137.8 | ) | (137.8 | ) | |||||||||||||||||||||
| Income tax expense/(benefit) from other adjustments | (m), (n), (o), (p), (q), (r) | 1.7 | (4.6 | ) | 4.6 | (1.5 | ) | (4.0 | ) | (5.6 | ) | (11.1 | ) | ||||||||||||||||||
| Adjusted net income (non-GAAP) | $ | 159.3 | $ | 132.6 | $ | 645.2 | $ | 155.3 | $ | 148.9 | $ | 155.0 | $ | 459.2 | |||||||||||||||||
(d) | Net income (GAAP) | $ | 171.0 | $ | 127.0 | $ | 626.0 | $ | 142.7 | $ | 141.0 | $ | 264.8 | $ | 548.5 | ||||||||||||||||
| Provision for/(benefit from) income taxes | 33.3 | 17.1 | 119.8 | 27.3 | 24.2 | (129.1 | ) | (77.6 | ) | ||||||||||||||||||||||
| Interest income | (3.6 | ) | (4.6 | ) | (15.6 | ) | (3.1 | ) | (3.7 | ) | (2.8 | ) | (9.6 | ) | |||||||||||||||||
| Interest expense | 27.0 | 26.3 | 105.3 | 26.1 | 31.1 | 32.2 | 89.4 | ||||||||||||||||||||||||
| Depreciation and amortization | 46.0 | 45.1 | 183.6 | 46.6 | 46.1 | 43.0 | 135.7 | ||||||||||||||||||||||||
| Other (income)/expense, net | 1.2 | (6.5 | ) | - | (0.9 | ) | (1.9 | ) | (0.2 | ) | (3.0 | ) | |||||||||||||||||||
| Business Solutions gain | (n) | (18.0 | ) | - | (18.0 | ) | - | - | - | - | |||||||||||||||||||||
| Acquisition, separation, and integration costs | (m) | 0.5 | 0.2 | 3.1 | 0.1 | 0.5 | 1.7 | 2.3 | |||||||||||||||||||||||
| Amortization and impairment of acquisition-related intangible assets | (p) | - | - | - | - | 2.0 | 0.2 | 2.2 | |||||||||||||||||||||||
| Redeployment program costs | (o) | 4.1 | 10.0 | 29.5 | 14.0 | 9.4 | 18.0 | 41.4 | |||||||||||||||||||||||
| Russia asset impairments and termination costs | (r) | - | - | - | - | - | 12.7 | 12.7 | |||||||||||||||||||||||
| Less Business Solutions operating income | (n) | - | - | (3.6 | ) | - | - | - | - | ||||||||||||||||||||||
| Adjusted EBITDA (non-GAAP) | (l) | $ | 261.5 | $ | 214.6 | $ | 1,030.1 | $ | 252.8 | $ | 248.7 | $ | 240.5 | $ | 742.0 | ||||||||||||||||
(e) | Effective tax rate (GAAP) | 16 | % | 12 | % | 16 | % | 16 | % | 15 | % | (95 | )% | (16 | )% | ||||||||||||||||
| IRS settlement | (s) | 0 | % | 0 | % | 0 | % | 0 | % | 0 | % | 102 | % | 29 | % | ||||||||||||||||
| Other adjustments | (m), (n), (o), (p), (q), (r) | 1 | % | 2 | % | (1 | )% | 0 | % | 1 | % | 1 | % | 0 | % | ||||||||||||||||
| Adjusted effective tax rate (non-GAAP) | 17 | % | 14 | % | 15 | % | 16 | % | 16 | % | 8 | % | 13 | % | |||||||||||||||||
(f) | Diluted earnings per share (GAAP) ($- dollars) | $ | 0.46 | $ | 0.35 | $ | 1.68 | $ | 0.41 | $ | 0.41 | $ | 0.78 | $ | 1.61 | ||||||||||||||||
| Pretax impacts from the following: | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Acquisition, separation, and integration costs | (m) | - | - | 0.01 | - | - | - | - | |||||||||||||||||||||||
| Amortization and impairment of acquisition-related intangible assets | (p) | - | - | - | - | 0.01 | - | - | |||||||||||||||||||||||
| Business Solutions gain | (n) | (0.05 | ) | - | (0.05 | ) | - | - | - | - | |||||||||||||||||||||
| Redeployment program costs | (o) | 0.01 | 0.03 | 0.08 | 0.04 | 0.03 | 0.05 | 0.12 | |||||||||||||||||||||||
| Russia asset impairments, termination costs, and currency remeasurement | (r) | - | - | - | - | - | 0.04 | 0.04 | |||||||||||||||||||||||
| Income tax expense/(benefit) impacts from the following: | |||||||||||||||||||||||||||||||
| IRS settlement | (s) | - | - | - | - | - | (0.40 | ) | (0.40 | ) | |||||||||||||||||||||
| Other adjustments | (m), (n), (o), (p), (q), (r) | 0.01 | (0.01 | ) | 0.02 | - | (0.01 | ) | (0.01 | ) | (0.03 | ) | |||||||||||||||||||
| Adjusted diluted earnings per share (non-GAAP) ($- dollars) | $ | 0.43 | $ | 0.37 | $ | 1.74 | $ | 0.45 | $ | 0.44 | $ | 0.46 | $ | 1.34 | |||||||||||||||||
| CMT Segment Metrics | |||||||||||||||||||||||||||||||
(g) | Revenues (GAAP) | $ | 1,019.0 | $ | 975.5 | $ | 4,005.0 | $ | 962.0 | $ | 965.0 | $ | 932.2 | $ | 2,859.2 | ||||||||||||||||
| Foreign currency translation and Argentina inflation impact | (k) | (7.1 | ) | (3.4 | ) | 4.6 | 2.5 | 12.7 | 7.4 | 22.6 | |||||||||||||||||||||
| Revenues, constant currency, net of Argentina inflation (non-GAAP) | $ | 1,011.9 | $ | 972.1 | $ | 4,009.6 | $ | 964.5 | $ | 977.7 | $ | 939.6 | $ | 2,881.8 | |||||||||||||||||
| Prior year revenues (GAAP) | $ | 982.4 | $ | 985.2 | $ | 3,993.5 | $ | 938.3 | $ | 1,072.2 | $ | 1,019.0 | $ | 3,029.5 | |||||||||||||||||
| Revenues (GAAP) - YoY % change | 4 | % | (1 | )% | 0 | % | 3 | % | (10 | )% | (9 | )% | (6 | )% | |||||||||||||||||
| Adjusted revenues (non-GAAP) - YoY % change | 3 | % | (1 | )% | 0 | % | 3 | % | (9 | )% | (8 | )% | (5 | )% | |||||||||||||||||
(h) | Cross-border principal, as reported ($- billions) | $ | 26.0 | $ | 25.2 | $ | 101.7 | $ | 24.6 | $ | 25.9 | $ | 25.9 | $ | 76.4 | ||||||||||||||||
| Foreign currency translation impact | (k) | (0.3 | ) | (0.2 | ) | 0.0 | 0.0 | 0.3 | 0.1 | 0.4 | |||||||||||||||||||||
| Cross-border principal, constant currency ($- billions) | $ | 25.7 | $ | 25.0 | $ | 101.7 | $ | 24.6 | $ | 26.2 | $ | 26.0 | $ | 76.8 | |||||||||||||||||
| Prior year cross-border principal, as reported ($- billions) | $ | 23.0 | $ | 23.4 | $ | 93.6 | $ | 23.0 | $ | 27.5 | $ | 26.0 | $ | 76.5 | |||||||||||||||||
| Cross-border principal, as reported - YoY % change | 13 | % | 8 | % | 9 | % | 7 | % | (6 | )% | 0 | % | 0 | % | |||||||||||||||||
| Cross-border principal, constant currency - YoY % change | 11 | % | 7 | % | 9 | % | 7 | % | (5 | )% | 0 | % | 0 | % | |||||||||||||||||
| CS Segment Metrics | |||||||||||||||||||||||||||||||
(i) | Revenues (GAAP) | $ | 78.8 | $ | 76.8 | $ | 322.3 | $ | 87.1 | $ | 101.4 | $ | 103.8 | $ | 292.3 | ||||||||||||||||
| Foreign currency translation and Argentina inflation impact | (k) | 1.2 | 4.8 | 10.7 | 3.0 | (6.2 | ) | (12.9 | ) | (16.0 | ) | ||||||||||||||||||||
| Revenues, constant currency, net of Argentina inflation (non-GAAP) | $ | 80.0 | $ | 81.6 | $ | 333.0 | $ | 90.1 | $ | 95.2 | $ | 90.9 | $ | 276.3 | |||||||||||||||||
| Prior year revenues (GAAP) | $ | 64.6 | $ | 77.2 | $ | 285.1 | $ | 83.2 | $ | 83.5 | $ | 78.8 | $ | 245.5 | |||||||||||||||||
| Revenues (GAAP) - YoY % change | 22 | % | (1 | )% | 13 | % | 5 | % | 21 | % | 32 | % | 19 | % | |||||||||||||||||
| Adjusted revenues (non-GAAP) - YoY % change | 24 | % | 6 | % | 17 | % | 8 | % | 14 | % | 15 | % | 13 | % | |||||||||||||||||
| Business Solutions Segment Metrics | |||||||||||||||||||||||||||||||
(j) | Revenues (GAAP) | $ | - | $ | - | $ | 29.7 | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
| Foreign currency translation impact | (k) | - | - | 0.2 | - | - | - | - | |||||||||||||||||||||||
| Revenues, constant currency (non-GAAP) | $ | - | $ | - | $ | 29.9 | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||
| 2024 Consolidated Outlook Metrics | |||||||||||||||||||||||||||||||
| Notes | Range | ||||||||||||||||||||||||||||||
| Revenues (GAAP) | $ | 4,125 | $ | 4,200 | |||||||||||||||||||||||||||
| Foreign currency translation and Argentina inflation impact | (k) | 25 | 25 | ||||||||||||||||||||||||||||
| Revenues, adjusted (non-GAAP) | $ | 4,150 | $ | 4,225 | |||||||||||||||||||||||||||
| Range | |||||||||||||||||||||||||||||||
| Operating margin (GAAP) | 17 | % | 19 | % | |||||||||||||||||||||||||||
| Redeployment program costs | (o) | 1 | % | 1 | % | ||||||||||||||||||||||||||
| Impact from acquisition, separation, and integration costs | (m) | 0 | % | 0 | % | ||||||||||||||||||||||||||
| Amortization and impairment of acquisition-related intangible assets | (p) | 0 | % | 0 | % | ||||||||||||||||||||||||||
| Russia asset impairments and termination costs | (r) | 1 | % | 1 | % | ||||||||||||||||||||||||||
| Operating margin, adjusted (non-GAAP) | 19 | % | 21 | % | |||||||||||||||||||||||||||
| Range | |||||||||||||||||||||||||||||||
| Earnings per share (GAAP) ($- dollars) | $ | 1.94 | $ | 2.04 | |||||||||||||||||||||||||||
| Redeployment program costs | (o) | 0.11 | 0.11 | ||||||||||||||||||||||||||||
| Acquisition, separation, and integration costs | (m) | 0.01 | 0.01 | ||||||||||||||||||||||||||||
| Amortization and impairment of acquisition-related intangible assets | (p) | 0.01 | 0.01 | ||||||||||||||||||||||||||||
| Russia asset impairments, termination costs, and currency remeasurement | (r) | 0.04 | 0.04 | ||||||||||||||||||||||||||||
| Income taxes associated with these adjustments | (m), (o), (p), (q), (r) | (0.01 | ) | (0.01 | ) | ||||||||||||||||||||||||||
| IRS settlement | (s) | (0.40 | ) | (0.40 | ) | ||||||||||||||||||||||||||
| Earnings per share, adjusted (non-GAAP) ($- dollars) | $ | 1.70 | $ | 1.80 | |||||||||||||||||||||||||||
| Non-GAAP related notes: | |||||||||||||||
| (k) | Represents the impact from the fluctuation in exchange rates between all foreign currency denominated amounts and the United States dollar. Constant currency results exclude any benefit or loss caused by foreign exchange fluctuations between foreign currencies and the United States dollar, net of foreign currency hedges, which would not have occurred if there had been a constant exchange rate. Constant currency results also reflect the impact of Argentina inflation, where indicated, due to its economy being hyperinflationary. The Company estimates Argentina inflation as the revenue growth not attributable to either transaction growth or the change in price (revenue divided by principal). Argentina inflation has historically had a more significant impact to revenues in the Company's Consumer Services segment, as proportionally, there are higher revenues generated from Argentina in the Company's Consumer Services segment, relative to its Consumer Money Transfer segment. | ||||||||||||||
| (l) | Earnings before Interest, Taxes, Depreciation, and Amortization ("EBITDA") results from taking operating income and adjusting for depreciation and amortization expenses. EBITDA results provide an additional performance measurement calculation which helps neutralize the operating income effect of assets acquired in prior periods. | ||||||||||||||
| (m) | Represents the impact from expenses incurred in connection with the Company's acquisition and divestiture activity, including for the review and closing of these transactions, and integration costs directly related to the Company's acquisitions. Beginning in 2024, the expenses are not included in the measurement of segment operating income provided to the Chief Operating Decision Maker ("CODM") for purposes of performance assessment and resource allocation. | ||||||||||||||
| (n) | During 2021, the Company entered into an agreement to sell its Business Solutions business to Goldfinch Partners LLC and The Baupost Group LLC (collectively, the "Buyer"). The sale was completed in three closings, the first of which occurred on March 1, 2022 with the entirety of the cash consideration collected at that time and allocated to the closings on a relative fair value basis. The final closing, which included the European Union operations, occurred on July 1, 2023 and resulted in a gain of $18.0 million. Revenues have been adjusted to exclude the carved out financial information for the Business Solutions business to compare the year-over-year changes and trends in the Company's continuing businesses, excluding the effects of this divestiture. | ||||||||||||||
| (o) | Represented severance, expenses associated with streamlining the Company's organizational and legal structure, and other expenses associated with the Company's program which redeployed expenses in its cost base through optimizations in vendor management, real estate, marketing, and people strategy as previously announced in October 2022. Expenses incurred under the program also included non-cash impairments of operating lease right-of-use assets and property and equipment. The expenses were not included in the measurement of segment operating income provided to the CODM for purposes of performance assessment and resource allocation. The Company had also excluded a tax benefit directly associated with streamlining the Company's legal structure in the fourth quarter of 2023 from its measures of adjusted net income, adjusted effective tax rate, and adjusted diluted earnings per share. | ||||||||||||||
| (p) | Represents the incremental non-cash amortization and impairment of acquired intangible assets in connection with recent business acquisitions. The expenses are not included in the measurement of segment operating income provided to the CODM for purposes of performance assessment and resource allocation. These expenses are therefore excluded from the Company's segment operating income results. | ||||||||||||||
| (q) | In addition to the income tax effects of the adjustments described above, the second quarter of 2024 included an adjustment to exclude an income tax benefit of $2.6 million related to the non-cash impact of remeasuring the Company's deferred tax assets and liabilities for tax law changes that were enacted in that period in Barbados. | ||||||||||||||
| (r) | While the Company had previously made a decision to suspend its operations in Russia, in the third quarter of 2024, the Company decided to pursue either liquidating or selling the Russian assets, which triggered a review of the carrying value of these assets. In the third quarter of 2024, the Company recorded asset impairments of $12 million related to its assets in Russia. Amounts presented also include the costs associated with operating the Russian entity which are no longer needed for the Company's ongoing operations. Beginning with the third quarter of 2024, the expenses have only been incurred in order to complete the liquidation or possible sale of the Russian assets. Additionally, where indicated, the Company has excluded the impact of the foreign currency remeasurement of the Russian ruble because of the decision to liquidate or sell the Russian assets. These costs are not included in the measurement of segment operating income provided to the CODM for purposes of performance assessment and resource allocation. | ||||||||||||||
| (s) | In the third quarter of 2024, the Company entered into a settlement with the U.S. Internal Revenue Service ("IRS") regarding the Company's 2017 and 2018 federal income tax returns. The Company is contesting the one remaining unagreed adjustment at the IRS Appeals level and has fully reserved for this unagreed adjustment. The Company has excluded the non-cash reversal of the uncertain tax position liability associated with the settlement because of the significance of this settlement on its reported results. | ||||||||||||||
| (t) | Represents revenues from transactions originated in Iraq. Beginning in March 2023, the Company experienced a significant increase in its business originating from Iraq. The Company believes this volume to have been the effect of policy changes by United States and Iraqi regulators. Over the past several months, the Company has been in regular discussions with policymakers in both the United States and Iraq about the elevated remittance volumes flowing through its network in Iraq. In July 2023, the United States Treasury and the Federal Reserve Bank of New York announced actions that banned 14 Iraqi banks, some of whom were the Company's agents, from conducting U.S. dollar transactions. Additionally, in October 2023, the Central Bank of Iraq suspended the Company's largest agent in the country, although that agent was later reinstated and resumed offering the Company's services. The effect of fluctuations between the Iraqi dinar and United States dollar on reported revenues was not significant for these periods. Because of the significant volatility in revenues and challenges in offering the Company's services in the country, management believes that revenue measures that exclude the Iraq revenues provide better consistency and comparability to prior periods and assist in understanding trends in the Company's ongoing revenues. | ||||||||||||||
| Other notes: | |||||||||||||||
| (aa) | Geographic split for transactions and revenue, including transactions initiated digitally, as earlier defined, is determined entirely based upon the region where the money transfer is initiated. | ||||||||||||||
| (bb) | Represents the North America (United States and Canada) ("NA") region of the Company's Consumer Money Transfer segment. | ||||||||||||||
| (cc) | Represents the Europe and the Commonwealth of Independent States ("EU & CIS") region of the Company's Consumer Money Transfer segment. | ||||||||||||||
| (dd) | Represents the Middle East, Africa, and South Asia ("MEASA") region of the Company's Consumer Money Transfer segment, including India and certain South Asian countries, which consist of Bangladesh, Bhutan, Maldives, Nepal, and Sri Lanka. | ||||||||||||||
| (ee) | Represents the Latin America and the Caribbean ("LACA") region of the Company's Consumer Money Transfer segment, including Mexico. | ||||||||||||||
| (ff) | Represents the Asia Pacific ("APAC") region of the Company's Consumer Money Transfer segment. | ||||||||||||||
| (gg) | Represents transactions conducted and funded through websites and mobile applications marketed under the Company's brands ("Branded Digital"). | ||||||||||||||
Contacts
Media Relations:
Brad Jones
media@westernunion.com
Investor Relations:
Tom Hadley
WesternUnion.IR@westernunion.com
