Yahoo Finance The Western Union Co (WU) Q1 2024 Earnings Call Transcript Highlights: Key Financial ...
Revenue: $1.050 billion, adjusted increase of 3% year-over-year.
Adjusted Earnings Per Share (EPS): $0.45, up 5% year-over-year.
Consumer Money Transfer Transactions: Grew 6% in the quarter.
Branded Digital Business Revenue Growth: 9%, highest since Q3 2021.
Adjusted Operating Margin: 19.7%, down from 20.5% last year.
Free Cash Flow: Year-to-date operating cash flows at $94 million.
Capital Return to Shareholders: $230 million in stock repurchases and dividends.
2024 Revenue Outlook: Raised to $4.15 billion to $4.225 billion.
2024 Adjusted EPS Outlook: Now expected to be $1.70 to $1.80.
Release Date: April 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you go into a bit more detail on what the factors are and the contributions from other consumer services with the core money [transfer side]? A: (Matthew Cagwin, EVP & CFO) - The over delivery in Q1 was split around 1/2 to 2/3 tied to Iraq, about 1/3 tied to our branded digital business coming a bit stronger than anticipated, and a little bit in our consumer services business.
Q: Can you expand a bit upon your expanded relationship with Visa, particularly the Visa Direct capability and the status of Visa Plus? A: (Devin B. McGranahan, President, CEO & Director) - We are pleased with our progress using Visa Direct globally and expanding our issuing capabilities, including our new wallet in Brazil and prepaid card in the U.S. Regarding Visa Plus, as we have not yet launched our wallet in the U.S., there is no activity to update.
Q: Can you update us on some of the technology initiatives that are less visible to the customer, particularly those related to simplifying your internal infrastructure? A: (Devin B. McGranahan, President, CEO & Director) - We are progressing in three main areas: migrating our core processing and settlement platforms to the cloud, transitioning from transaction-centric to customer-centric systems, and modernizing our front-end platforms to improve customer experience and global delivery.
Q: How sustainable is the low teens transaction growth rate in digital as you start to lap tougher comps? A: (Devin B. McGranahan, President, CEO & Director) - We remain confident in achieving double-digit growth in our digital business as part of our EVOLVE 2025 strategy, supported by four consecutive quarters of double-digit transaction growth.
Q: Can you discuss the impact of the new loyalty program on improving the retail business and its potential for driving sustainable growth? A: (Devin B. McGranahan, President, CEO & Director) - The new loyalty program is designed to improve retention by recognizing customers across all channels and rewarding them after five transactions, which we believe will drive long-term sustainable growth, particularly in retail.
Q: What are the drivers behind the narrowing spread in the digital branded business and how is this trend expected to continue? A: (Devin B. McGranahan, President, CEO & Director) - The narrowing spread is due to improved transaction trends and retention rates as we lap the rollout of our go-to-market strategy. This trend accelerated more than anticipated in Q1, which is a positive sign.
Q: Could you provide more detail on the quarterly cadence and full-year expectations for Iraq's contribution to revenue? A: (Matthew Cagwin, EVP & CFO) - Iraq contributed approximately 4% growth in Q1. We expect it to be around the upper end of our previous guide of $50 million to $100 million for the full year, with potential quarterly contributions ranging from $10 million to $30 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
