Western Union Company (the) · NYSE:WU
Western Union Company (the) — The Western Union Company — Q3 2024 Earnings Presentation
36 slides from Western Union Company (the)'s earnings presentation, Oct 23, 2024
Slide 1: Third Quarter 2024 Financial Results
Third Quarter 2024 Financial Results October 23, 2024
Slide 2: Tom Hadley, VP of Investor Relations
Western Union Tom Hadley Vice President of Investor Relations 2
Slide 3: Forward-Looking Statements
Western Union Forward-Looking Statements This presentation 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 assumpti
Slide 4: Devin McGranahan, President & CEO
Western Union Devin McGranahan President & CEO 4
Slide 5: Evolve 2025 Driving Improvements
Western Union Evolve 2025 Driving Improvements +4% CMT Transactions (ex. Iraq) Total Adjusted Revenue* (ex. Iraq) +1% +15% Branded Digital Transactions 0.1% -0.6% +9% Branded Digital Adjusted Revenue -3.5% -3.7% 3Q23 4Q23 1Q24 2Q24 3Q24 +15% Consumer Services Adjusted Revenue 5 *Note: See appendix f
Slide 6: Third Quarter Results
Western Union Third Quarter Results $1.04 billion GAAP revenue 15.9% 19.1% GAAP operating margin Adjusted operating margin* $0.78 $0.46 GAAP EPS Adjusted EPS* 6 *Note: See appendix for reconciliation of GAAP to Non-GAAP financial measures.
Slide 7: Diverse Business Helps Minimize Market Volatility
Western Union CMT revenue is distributed globally, Branded Digital represented 25% of CMT revenue included in the regions below: Diverse Business Helps Minimize 39% 27% Market Volatility 17% 6% 11% Note all data is shown as of Q3’2024 7 Definitions: North America (United States and Canada) (“NA”), E
Slide 8: Branded Digital Transaction Trends
Western Union Branded Digital Branded Digital Transaction Trends 15% 13% 13% 13% 12% 12% 7% 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 6 quarters of double-digit transaction growth 8
Slide 9: Retail as the Gateway to Western Union
Western Union Retail as the Gateway to Western Union New Iteration of Point of Sale Debit Card Acceptance Lifetime Value Loyalty Program Quick Resend Customer Retention One Step Refund Customer Universal Customer ID Experience 9
Slide 10: Singapore Owned Stores
Western Union Singapore Owned Stores There are nearly 20 owned stores in Singapore: Revenue Trends +12% Revenue Growth YTD Q3’24 3% -5% -9% -15% -14% 2019 2020 2021 2022 2023 10
Slide 11: Delivering Accessible Financial Services
Western Union Delivering Accessible Financial Services Bill Digital FX Lending Media Prepaid Retail Payment Wallets Exchange Partnerships Network Card Money Order 11
Slide 12: Dash Digital Mexico Wallet
Western Union Dash Digital Mexico Wallet • Retail-to-digital escalator • Platform and assets • Ecosystem • Ecosystem • APAC highly digitized • Key market 12
Slide 13: Evolve 2025 Strategy
Western Union Evolve 2025 Strategy • Digital first customer • Digital first customer experiences experiences • Scalable marketing driven • Remittance-led offering customer acquisition • Expanded set of accessible • Retail to digital escalator products and services Deliver Accelerate digital accessib
Slide 14: Matt Cagwin, Chief Financial Officer
Western Union Matt Cagwin Chief Financial Officer 14
Slide 15: Business Trends
Western Union Business Trends Adjusted Revenue Growth* Adjusted Operating Margin* 1200 Adj. Rev. Growth 12% Avg: 18.7% 10% 1199.8 Adj. Rev. Growth ex. Iraq 8% 4% 1199.6 3% 6% 1199.4 4% -1% 1199.2 2% 1% 19.6% 19.7% 1199 0% 16.1% 19.0% 19.1% -1% 0% -2% -6% 1198.8 1198.6 -4% -4% -7% -4% -6% 1198.4 -8%
Slide 16: CMT Business Trends
Western Union CMT Business Trends Key Highlights • Branded Digital achieved 6th consecutive quarter of double-digit transaction growth • Europe & CIS and APAC achieved positive quarterly adjusted revenue growth for the first time since 2021 North America Q3 2024 % of Q3 EU & CIS 2024 CMT MEASA CMT a
Slide 17: Consumer Services
Western Union Consumer Services Consumer Services Highlights Consumer Services Adj. Revenue Growth* • Adjusted revenue* increased 15% 24% • Includes bill payments, retail money order, forex exchange, 15% 14% media network, prepaid card, lending partnerships, and digital 6% 8% wallets • Continue to e
Slide 18: Accomplished nearly three-quarters of 5-Year $150M Expense Redeployment Program
Western Union 5-Year $150M Expense Redeployment Program Targeted Future Achieved Redeployments in 2023 Accomplished $40M $50M nearly three- quarters of our Investor Day Goal $60M Actioned in 2024 18
Slide 19: Financial Highlights
Western Union Financial Highlights YTD as of September 30, 2024 Cash flow from operations $272 million Capital Expenditures $92 million Dividends paid $239 million Share repurchases $177 million Cash balance $1.1 billion Debt outstanding $2.6 billion 19
Slide 20: 2024 Financial Outlook
Western Union 2024 Financial Outlook Revenue (M) Operating margin EPS GAAP $4,125 to $4,200 17% to 19% $1.94 to $2.04 Adjusted* $4,150 to $4,225 19% to 21% $1.70 to $1.80 20 *Note: See appendix for reconciliation of GAAP to Non-GAAP financial measures.
Slide 21: Questions and Answers
Western Union Questions and Answers 21
Slide 22: Appendix
Western Union Appendix Third Quarter 2024 22
Slide 23: Key Statistics and Reconciliation of Non-GAAP Measures
Western Union Key Statistics and Reconciliation of Non-GAAP Measures Western Union’s management believes the non-GAAP financial A non-GAAP financial measure should not be considered in measures presented within this presentation provide meaningful isolation or as a substitute for the most comparable
Slide 24: Western Union
Western Union 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)%
Slide 25: Western Union
Western Union Notes 3Q23 4Q23 FY2023 1Q24 2Q24 3Q24 YTD 3Q24 CMT Segment Regional Metrics - YoY % change NA region revenues (GAAP) (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) (3)% (1)% (5)% 2% 1% (3)% 0% N
Slide 26: Western Union
Western Union Notes 3Q23 4Q23 FY2023 1Q24 2Q24 3Q24 YTD 3Q24 % of CMT Revenue NA region revenues 37% 39% 37% 38% 40% 39% 39% EU & CIS region revenues 24% 25% 25% 24% 25% 27% 25% MEASA region revenues 23% 18% 21% 21% 18% 17% 19% LACA region revenues 11% 12% 11% 12% 12% 11% 12% APAC region revenues 5%
Slide 27: Western Union
Western Union 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, ne
Slide 28: Western Union
Western Union Notes 3Q23 4Q23 FY2023 1Q24 2Q24 3Q24 YTD 3Q24 Consolidated Metrics cont. (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 inta
Slide 29: Western Union
Western Union Notes 3Q23 4Q23 FY2023 1Q24 2Q24 3Q24 YTD 3Q24 Consolidated Metrics cont. (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
Slide 30: Western Union
Western Union Notes 3Q23 4Q23 FY2023 1Q24 2Q24 3Q24 YTD 3Q24 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 Arg
Slide 31: Western Union
Western Union Notes 3Q23 4Q23 FY2023 1Q24 2Q24 3Q24 YTD 3Q24 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
Slide 32: Western Union
Western Union Notes 3Q23 4Q23 FY2023 1Q24 2Q24 3Q24 YTD 3Q24 Net cash provided by/(used in) operating activities (GAAP) $ 254.6 $ 264.5 $ 783.1 $ 94.0 $ (33.8) $ 212.1 $ 272.3 Depreciation (9.8) (9.2) (39.1) (9.2) (9.5) (8.9) (27.6) Amortization (36.2) (35.9) (144.5) (37.4) (36.6) (34.1) (108.1) Gai
Slide 33: 2024 Consolidated Outlook Metrics
Western Union 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 acqui
Slide 34: Non-GAAP footnotes
Western Union (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
Slide 35: Non-GAAP footnotes (continued)
Western Union (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 c
Slide 36: Thank you.
Thank you. ©2024 Western Union Holdings, Inc. All rights reserved
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