| · Q3 GAAP revenue of $1.04 billion, down 6% on a reported basis; Adjusted revenue, excluding Iraq, was up 1% |
| · Branded Digital reported revenue grew 8%, or 9% on an adjusted basis, with transactions up 15% |
| · Consumer Services revenue grew 32% on a reported basis and 15% on an adjusted basis |
| · Q3 GAAP EPS of $0.78 or adjusted EPS of $0.46 |
| 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 a 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 contributions 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's inflation |
| 2 The adjusted effective tax rate is expected to be in the low teens range |
| For the full document click the link below: |
| The Western Union Company |
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