Slide 1: Western Union Third Quarter 2010 Earnings Webcast & Conference Call
Western Union Third Quarter 2010 Earnings Webcast & Conference Call October 26, 2010 Exhibit 99.2
Slide 2: Mike Salop, Senior Vice President, Investor Relations
Mike Salop Senior Vice President, Investor Relations
Slide 3: Hikmet Ersek, President & Chief Executive Officer
Hikmet Ersek President & Chief Executive Officer
Slide 4: Overview
Overview Continued progress 10% C2C transaction growth in Q3 Steady to improved trends across all regions Strong margins, cash flow, and shareholder payout Raising full year 2010 EPS outlook
Slide 5: Electronic Channels Highlights
Electronic Channels Highlights Westernunion.com 60% transaction growth in international markets 20% transaction growth overall Account-based money transfer 50% transaction growth 27 banks globally Mobile 70,000 locations enabled for cash-to-mobile in 27 countries 6 country websites enabled Prepaid 6
Slide 6: Strategic Priorities
Strategic Priorities Strategy in place Focused on execution
Slide 7: Scott Scheirman, Executive Vice President & Chief Financial Officer
Executive Vice President & Chief Financial Officer Scott Scheirman
Slide 8: Revenue
Revenue ($ in millions) $1,314 Consolidated revenue up 1%, or up 3% constant currency adjusted Transaction fees flat Foreign exchange revenue increased 11%, primarily due to Custom House $1,330 Note: See appendix for reconciliation of Non-GAAP to GAAP measures.
Slide 9: C2C Remittance Trends
C2C Remittance Trends +10% Total Q3 Western Union cross- border principal of $18 billion Increased 4% on reported basis Increased 6% constant currency Principal per transaction Declined 4% on reported basis Declined 3% constant currency C2C Transactions (millions) Note: See appendix for reconciliati
Slide 10: Consumer-to-Consumer: Europe, Middle East, Africa, S. Asia
Consumer-to-Consumer Revenue Transactions Q3 2010 (2)% 5% Europe, Middle East, Africa, S. Asia 44% of Western Union revenue EMEASA constant currency revenue increased Good performance in major markets including U.K., Germany, and Russia Transaction declines in Gulf, in-line with Q2 trends
Slide 11: Consumer-to-Consumer: Americas
Consumer-to-Consumer Revenue Transactions Americas 2% 13% 32% of Western Union revenue Momentum continued in the region 35% domestic money transfer transaction growth Strong U.S Outbound results 2% Mexico transaction growth, 1% revenue decline Q3 2010
Slide 12: Consumer-to-Consumer: Asia Pacific
Consumer-to-Consumer Revenue Transactions Asia Pacific 12% 15% 9% of Western Union revenue China grew revenue and transactions 6% Philippines intra business strong Good growth in Australia Q3 2010
Slide 13: C2C Transaction and Revenue Growth
C2C Transaction and Revenue Growth Note: See appendix for reconciliation of Non-GAAP to GAAP measures. Q3 2010
Slide 14: Global Business Payments
Global Business Payments Revenue Transactions Global Business Payments 5% (2)% 13% of Western Union revenue $27 million Business Solutions (Custom House) revenue Challenges in U.S. bill payments Solid Pago Facil performance Q3 2010
Slide 15: Operating Margin
Operating Margin Operating margin excluding restructuring and settlement accrual • +70 basis points vs. Q3 09 • +40 basis points vs. Q2 10 YoY o perating margin improvement excluding restructuring • Lower marketing • Operating efficiencies • Higher Business Solutions investment and amortization Note
Slide 16: C2C Operating Margin
C2C Operating Margin C2C operating margin increased 230 basis points YoY Lower marketing Operating efficiencies Currency C2C operating margin improved 80 basis points from Q2 10
Slide 17: Global Business Payments Operating Margin
Global Business Payments Operating Margin Note: See appendix for reconciliation of Non-GAAP to GAAP measures. Segment margin declined YoY Business Solutions investments and amortization Reduced U.S. bill payment revenues GAAP Excluding Business Solutions
Slide 18: Financial Strength
Financial Strength YTD Cash Flow from Operations Excluding Tax Deposit $960 million Refundable IRS Tax Deposit ($250) million GAAP Cash Flow from Operations $710 million Capital Expenditures $88 million Stock Repurchases $514 million Dividends Paid $80 million Cash Balance, September 30, 2010 $2.0 b
Slide 19: 2010 Outlook
2010 Outlook GAAP revenue in a range of +1% to +2% Constant currency revenue growth 1% higher than GAAP (+2% to +3%) GAAP EPS of $1.29 to $1.32, including $0.07 of restructuring charges EPS excluding restructuring charges of $1.36 to $1.39 Constant currency EPS $0.01 higher GAAP cash flow from opera
Slide 20: Questions & Answers
Questions & Answers
Slide 21: Slide 21
Slide 22: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures 3Q09 4Q09 FY2009 1Q10 2Q10 3Q10 YTD 3Q10 Consumer-to-Consumer Segment Revenues, as reported (GAAP) 1,117.8 $ 1,113.7 $ 4,300.7 $ 1,030.2 $ 1,073.1 $ 1,128.3 $ 3,231.6 $ Foreign currency translation impact (a) 24.4 (36.2) 101.3 (21.9) 15.0 21.2 14.3 Revenues, const
Slide 23: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures 3Q09 4Q09 FY2009 1Q10 2Q10 3Q10 YTD 3Q10 Global Business Payments Segment Revenues, as reported (GAAP) 171.3 $ 181.8 $ 691.7 $ 181.8 $ 179.3 $ 179.2 $ 540.3 $ Reversal of Custom House revenues (b) (7.9) (22.9) (30.8) (25.6) (28.5) (26.8) (80.9) Revenues, excluding
Slide 24: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures 2010 Revenue Outlook Revenue change (GAAP) % % Foreign currency translation impact (e) % % Revenue change, constant currency adjusted % % 2010 EPS Outlook EPS guidance (GAAP) ($ - dollars) 1.29 $ 1.32 $ Impact from restructuring and related expenses, net of income