EEFT - Earnings call transcript Q3 2019

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Operator

Greetings and welcome to the Euronet Worldwide Third Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]

It is now my pleasure to introduce your host Mr. President Counsel Vice Euronet Executive Newman, and for General Worldwide. Jeff you. Thank Mr.

may Newman you begin.

Jeff Newman

Good everyone and results you, morning Thank Bridget. welcome conference to call. quarterly Euronet's

of We on present our for third will results this quarter call. the XXXX

Brown, Mike Executive on Caponecchi, the and and President have Weller, our our We Vice epay the CFO; of CEO call. Kevin Rick Division CEO;

making this we I need the the that on disclaimer statements page or begin, intentions, to of to its on are Before expectations of the presentation statements. PowerPoint today. concern Euronet's be or we'll forward-looking call future call your Statements forward-looking first management's attention performance predictions

first Euronet's actual Euronet does of intend forward-looking a provide such result to our to results in not of update statements to forward-looking person update duty vary any the may any number no of those such are and under page anticipated as any that undertakes a from presentation. statements, factors these materially on circumstances. listed

certain the presentation. that is annex PowerPoint the our Please the included to included as measures data GAAP non-GAAP reconciliation also supplemental in equivalents an note of to

the turn CFO, Rick over I'll Now, to call our Weller.

Rick Weller

Thank comments third right. million slide begin us will today. We you, my EBITDA of income adjusted who's and thank $XXX Jeff, I everyone All you delivered million, of quarter joined $XXX revenue five. operating on and of million. $XXX

growth very rate. double-digit XX% growth growth and income impressive operating contributing adjusted adjusted a growth, of These revenue represent growth XX%, currency results all constant XX% to EBITDA EPS numbers the

delivered from rate three contributions by in EPS. all was income segments Our we sixth XX% quarter year-over-year taxes. growth adjusted a from and increase adjusted $X.XX, have the quarter growth consecutive operating was benefits EPS strong the and income that This driven third for double-digit

India. was the tax in such recurring lower items from the half while certain half other tax recently items, rate benefit announced as About the non-recurring from was

of from Additionally changes was share offset ,$X.XX $X.XX rates in from currency by favorability of headwind repurchases. foreign

transaction and in transactions, growth three-year our conversion, as and XX%, of value-added This well point-of-sale transactions on and show trends international networks grew by expansion foreign dynamic segment. we currency deposit ATM driven local withdrawals six, Europe dispensing. currency our including included by Asia. terminals, domestic ATMs and as processing slide On our point-of-sale surcharge international EFT and and transactions in and

epay grew significant India, expansion continued in mobile from which transactions amount traditional with revenue. transactions earn of more small a XX%, transaction digital per and media top-up revenue to contributions our commission-based compared wallet-driven

India transactions of at have revenue these double-digit Excluding epay rate XX%. would transactions, grown lower very nice a

was business U.S. our U.S. uncertainties Walmart. at by double-digit Money from from result grew international-originated domestic a X%. growth requirements our of sends, as transactions from exceptional additional stemming growth the ID growth of result our and declines Brexit offset This transfers outbound XE and limited partially in

Next slide please.

results our Here at slide segment have normalize declined seven, operate the on major we present basis. the as-reported currency slide. on on mid-single-digit To we adjusted of next currency an Year-over-year, impact where for our results presented fluctuations most we currencies rates.

eight Slide here.

and adjusted DCC agreements all per outsourcing XX% grew profit strong the and quarter, were growth and worldwide. grew EBITDA double-digit transaction both to grew XX% in nicely. a rates XX%. margins offer transactions, our third all gross of and Operating These the For XX%. ability revenues new increase income Revenue, expanded cards Visa ATMs EFT very result on operating

and SaaS grew income the adjusted solutions. XX% grew These grew were EBITDA expansion of growth digital XX%. media and revenue X%. rates products of Operating continued epay result strong

of India. transaction per a profit bit transactions gross see to continued as and of came mobile top-up in we a mix Revenue stronger out

consistent dollar constant low-margin growth expanded India gross margins with profit transaction XX%, operating transactions. the grew the when However, Moreover, nicely. excluding

of XX% grew and might an business are epay of share, result roughly you revenues share those with that our the this say excellent leaving commission retailers more know you revenue familiar with epay. epay for the double-digit that quarter, our that XX% about So, the we as from

Overall, fourth Transfer we quarter this income delivered EBITDA revenue quarter op adjusted X%. each growth. double-digit grew and Money epay income was consecutive adjusted and for have and grew outstanding operating the an X%, EBITDA, and

This result ID the results decline Brexit was driven growth growth partially previously international requirements. announced and as stemming double-digit constrained our by U.S. from in and domestic by strong transfers outbound uncertainties of from business remittances, additional the offset a from originated U.S. XE

than a of relates stronger UK XE to when the for you business, we profits the recall the it the XXXX, of quarter as result may that As in second normal reported voted pound. Brexit volatile

the that to resume to uncertainties larger they and business to patterns the of see expect growth more Transfer trading normal the we to continue start XE Money segment. making as the lift, begin We thus Brexit will contributions

a $X.XX To above appreciate quarter we we was transitory that seen end, seen the is as the British this corresponding first this confidence our transactions in Money have our conclude October, uptick business. to pound furthering have solid few that a event. for a on To in Segment, weeks of the Transfer dollar

core posting we U.S. as Transfer we market two growth are this Segment outpace double-digit events segment the pass at and next strong Money get the we the rates. within year, And be rates anticipate outbound of again Our we accustomed isolated to double-digit growth the very and the to international reporting. rate as will remittances continued into

contributions all was summary, for with segments. income from outstanding an three In this quarter op Euronet

bit. slide discuss X and go let's Now a the sheet balance to

partially million quarter. third you sheet settlement the strengthen. to cash share Here approximately in the from see increase business operations cash in $XX and continues repurchases balance our from by resulted in can The offset that timing generated

This Together, $XXX available are grow. to billion the cash, another the the business fund about needs, was million the in is cash. quarter to about Of in discretionary million for about revolver, with outstanding remaining $X cash, well settlement our positioned the ATMs. had Of $X.X billion we on approximately XX% we $XXX liquidity related needs to leaving Euronet.

Mike. to turn And it that, with I'll over

Mike Brown

who's continues success segments. to comments thank begin update Thank app us across everybody my a Lanka. Sri payment In an all you, joining the you three slide contribute I'll based our Rick, in on we Ceylon our quarter, Commercial XX with of business to number today. code leading-edge Bank launched QR with how of on and technology

Q+, a app digital model. The the engine all and ComBank and app; services merchant a cloud transactions; the solution utilized integrated central with that of settlement code QR development app payments develop called processing end-to-end reconciliation QR pay-per-use for infrastructure on associated the to a an microservices APIs IT code and customer architecture included open

and customers and of Ceylon merchants, allows the Sri based app WeChat payment secure at a The service Bank Lanka Alipay of friction-free, use Commercial and faster a ensures for to have like fingertips Pay. that in available easy simple or experience code to is payment QR customers and their

bill-pay launched In follow have India, of Amazon we September, we a BPCL. partner signed BPCL their service payments make with will technology bill now agreements expect a months. Amazon can and Amazon signed services number such for the Pay, a the strategic In Pay agreement Customers services provider we more we in their customers. Pay with to coming enable wants as Amazon first Google Pay. a to and account With provide using to

as epay initially services signed value-added bill Google services Pay launched for various such up and and payments. top-up has

We and in retailers Austria and Müller Alipay to Italy. dm stores also multiple in continued the to expansion of processing our

recurring monthly service monthly retailers for AppleCare implementation the Target. devices to of at Apple iPhone, This in price. Watch quarter, Products with purchase U.S. we for allows low subscription the a launched Products a This one recurring customers and AppleCare largest iPad

provides This a retailers provides convenient of a significant and SaaS which and Integrated the product Payments our value product both only for and Cloud plan. offering service end how had subscription the offer a two-year to AppleCare authorized the solution a providers proposition monthly Target higher a good through point its and example to much new implementing consumer Digital previously epay with is customers. to price could This who versus

technology. Now me It on significance the several delivery to on product here Integrated for Payments Cloud of the our this let and pause from Apple technology our capabilities Target. Digital leveraged reflect played

you we seen have our retail As our -- as brand with have you grown and see, partners. relationships

We deploy to but a solutions than themselves. have and cost-effective it more to want need to meet found and do faster partner new solutions that offer can they develop the they customer needs,

we tokenization, basis. cloud To engine, together renewal several recurring credit processing storage our brought launch of payment monthly subscriptions, monthly card the microservices, payment and to of protection, a the facilitate AppleCare cloud recurring necessary data including compliance, information on

to. this As into another It's we process, is a is not transaction historically value a large example that but software had technology have and to have Target. has which proposition for enabled solution compelling see, not our of how us Apple also customer enabled you access another can break retailers, this just

capabilities a several for and complex we more are In are new deliver to most solutions. enabling as solution collects it a a payment we simple combining connection, solutions than software hosting, and SaaS settlement, processing and are unique there's bills AppleCare. Through customers. case, SaaS payments, Our sophisticated our functions product But to with connections, and all solution. such also recurring host-to-host work compliance, tracks that unique cloud our one make

progress as an Finally installation continue Mozambique. of with the on as respect to the make Ren, switch update, Ren good to national we of

of XXXX. with implemented are expect deliverables and late to all Ren track our fully in We be on still

won't only the Mozambique Moreover, one. be

have to customers. continue We several discussions with

attendees, conference XX% in is Thailand speak, them of prospective our we clients. In registered with holding more fact, as team XXX software than a solutions

We as monetize ability you forward to them. remain updates in this groundbreaking to and we look providing have additional confident our solution

solutions to nature all our and As you to can create unique segments. to our problems success see continue the our assets face our customers technology, in contribute of three leading-edge ability to

EFT. number move the let's about segment talk we'll and slide Now XX to first

With it op I Our constant-currency a this EFT quarter. continues to say here? team park. What the of can XX% out income growth knock

we launching Slovenia. IAD added country XXth network quarter the our by to ATMs our During in

to efforts are in have And positive initial market the the launched we quarters. the be could and advantageous update XX underway we launch in year and next quarter, to last on of new several first beyond. Asian ATMs results new our to results active key Moreover, coming quite very you the markets

and participation a network POS merchant In of ATM Poland, parcel in deposit International and with acquiring FedEx, like for agreement in European Bank. our services Central Bank largest cash Habib we management enabled we We for a Hungary. one for finally, Bank in Uganda, of merchant cash dfcu delivery recycling also And companies kind Pakistan. renewed the launched deposits

XX you we of value-added this extensive, during so please. our some highlight of few. Next The a is list for quarter. have In customers last only slide with implemented an police Europe. idea connecting awareness with the the and agreements will Slide gives law across partnered campaigns enforcement AMBER have experts public on Alert publish assists other Europe, ATMs. Europe our AMBER we to Netherlands Alert alerts the in and I with

for point the missing children add touch ATM network soon. countries more public more alerting in Netherlands Our hope the to is one and we to

In participation Windcave, a Poland, acquirer cash largest agreement card-less enable new Poland. transaction we New merchant processing the new network signed In POS in the with merchant a card-less several signed agreement and new to Zealand, payouts for customers our country. -- network agreement fifth in we deposit DCC services expanded

We also in Lanka, Egypt, launched for Bahamas, Oman. Sri customers products issuing new and card Bolivia

with active finished finally And the ATMs, XX,XXX XX% we a quarter year-over-year increase.

high-value loss-making outsourced winter deployed new We for ATMs about During new XXX the a XXX India. from ATMs de-installed season. ATMs few almost and and the YourCash ATMs XXX we we low-margin deactivated new quarter, in XXX ATMs,

end to bearing For of generally ATMs EFT. independent quarters full another almost think hitting our deployments, was the it about is X,XXX X,XXX full-year, new exceptional operating ATM X,XXX the year the to we the in that goal. low-end XX% ATMs, we X,XXX expect XXX that With worth for of of mind range guidance just growth income strong in three have a repeating at this X,XXX and pipeline I quarter strong outsourced agreements added

move slide Now about and to talk XX we epay. we'll will on number

payment gross at I've digital they segment there. provides digital mean, with the that segment got innovative much its the comprising freaking media epay channels expand space. income across look continue the within results more XX% of currency. Okay. with more results redefine than SaaS proud gross very I am op to in profit portfolio the Both I and these total to media as and range to more quarter. media solutions and development EBITDA constant technology epay XX-plus percent for profit distribution digital with these start of continues leading-edge of the

another sales our of expanded Integrated Google a our Amazon of sold in Payments In and segment Cloud Digital and services content and Nintendo agreement another Nintendo SIBS being through and have ATM in utilizing to products offer we distribution through launched Switzerland, ATMs. stores. network to Austria from continue we Lekkerland Portugal example epay this through the McAfee of customer case, -- We signed stores Coop we distribution of Kaspersky, and

Next slide please.

launches mentioned to launch in to the we XXX retailer agreements additional signed locations. addition Alipay Alipay Australia, In previously we to

antivirus an We Europe. retail agreement all signed also to across partners software distribute Panda to

India Finally, quarter. process This Pay. Amazon mobile bill itself growth electronic delivery through and transaction evolved signed than payments leading-edge is we much constant-currency to an in to has transform product recurring payments into top-up, and op has payment the in become agreement epay other and sophisticated epay company. reflected more processor. the a transformation income continues in successful a XX%

move let's Money slide to minutes. couple XX of Transfer for talk and number we'll Now about a on

reaches XXX,XXX Transfer year-over-year Money XXX an X% increase. now in Our network locations countries

in pickup Bank new and Zimbabwe. in launched deposit we The XX include with quarter, correspondents service significant XX countries. ZB the bank cash most During launches

expanded funds mobile In our transfer to to wallets. we addition, capability

we And in mobile MTN, we service now Upay. can bKash to deliver and wallets. launched and Ghana, In funds Bangladesh, into Vodafone AirtelTigo

via In new Pay, rails. into Ria company bank engine countries Travelex. payout will we with network in addition new be will Finablr support digital has provide to which Samsung cash transfer with a have Ria deposit signed and additional money partnership In these coming correspondents agreements quarters. entered scale for launches, of in XX PLC the XX launched its

U.S. we payout one on-boarded market of partnering network in in Unitransfer Haiti. with agents the and of And to the the leaders the Canada

additional we imposed launched ID Walmart. Finally, much with app regarding add the iOS on both and headwinds partner mobile the RiaMoneyTransfer We to the Android. don't transactions our non-regulatory weathered requirements domestic have we regarding new our more on

for together forward look and meantime growth Money of us to we the the as annualizing of with new have our year-over-year the requirements We lapping for network diversity year. nicely positions business Transfer new in the these In very enter our growth XXXX. provided

Money in As lot the here have of see you segment. Transfer a we can things happening

growth may prefer isolated business. at requirements we we that uncertainties the we the These On growth segment, aren't in Walmart doubt the surface, rates you two through look and these Brexit. wonder but to ID get of and post, on the happening no the at in what's going that will the have events

kill portion we pleased to is However, substantial mid-teens remember Money that is for. And through as business are rates would you market of work this we at those, see others growing as an worldwide the the strong of Transfer double-digit billion. most that addressable $XXX

and segment the that transitory as confident producing. we in business, forward our are events and in Money Transfer We continues growth right of improved look growth see to direction our coming is to Transfer the in the the quarters which majority double-digit the we continue Money lap

number Now the we'll on go let's slide XX up and wrap quarter. to

a of sixth EPS EPS and the consecutive adjusted delivered we $X.XX, First, of growth. year-over-year XX% double-digit quarter increase

that and develop partners. launch SaaS solve We like continue our problems solutions to leading-edge for

operating continue solutions and XX% a SaaS-like expansion. continuing continued constant-currency growth, and growth income which EFT coming digital ATM epay's us will to delivered expansion, pay from growth media exceptional network double-digit months leading-edge while for the in rates invest years. network to in resulted

deliver U.S. growth our Money of quarter expect constant exceptional exchange be the outbound double-digit $X.XX balance And international remittances. adjusted sheet. assuming approximately to foreign to contributes free generation Transfer cash the EPS The we in strong finally, rates to and fourth rates. flow continues

questions. operator, to take assist? I'd be that, With Would you happy please

Operator

Kumar Rayna with Our line first Evercore the question comes of [Operator Instructions] from ISI.

open. Your line is

Rayna Kumar

Good Rick. morning and Mike

Mike Brown

Good morning.

Rick Weller

morning. Good

Rayna Kumar

strong expansion. So for the quarter, some we margin third saw

think basis then You we in had the a into XXXX? about the bit fourth Can how to adjusted drivers quarter you expansion talk and EBITDA and key going points about that margins maybe margin little increase XXX year-over-year. should

Rick Weller

got We part broken repeat you your that? of maybe. it Yeah Can -- up. half of only question I Rayna first about had the

Rayna Kumar

Sure.

adjusted expanded EBITDA XXX points third basis the quarter. your in margin So

drivers expectations then If can your to and expansion for discuss you margin into growth the XXXX? key into that and quarter also going fourth

Rick Weller

pick business were segment. our Yeah. up that able as of we the you Well, big DCC in to additional know the the EFT the in that drivers Visa of in one was addition

expand I -- so so as seasonally result ATM to is our grow and to but Mike quarter had third emphasize very then again continue good again and contributed epay out, to strongest a deployment, We it. that pointed help can't that quarter. And our

we into we also that's we'll get when year-over-year some see basis, the for numbers go business, And on get expansion. our expect the epay we some from quarter, benefit would a to some fourth And again DCC as the into -- so we come additional quarter strongest Visa nice. and

to quarter yes, our the epay come year-over-year present business be seasonality would it's see we on a and in to in quarter-to-quarter, think margins expansion quarter our of will EFT the particularly say I fair in that of basis, fourth continue from third. a going margin to because on business. third But that So the

Rayna Kumar

you That's very the your just And progressing an put on with helpful. do questions Walmart ID on XXXX When update we exactly initial talks And do requirements are April expect hear on to place? you contract two Walmart. When then renewal? your that lap Walmart conclusion to how the into second, that?

Rick Weller

I quarter. the probably the we lion's started year. last share let's saw pressure requirements it mean, really some most went part say We third wasn't of as of, come say the I Well, -- pronounced. of feeling would ID it, the of but in, like into We a for the quarter second kind --

through I, would take would lapping part or it, as for kind okay? So there give of, quarter first get that the be expect the that most that we

discussions, I well. that then think going they're quite as And to relates it our

to we those Our discussions. product the WalmartXWalmart has performed and very have good continue

wrap just we'll But line there's of had it exact point continue to on going the of Walmart but consistent went things have kind time good but renewal, and up year, a the to So that we are kind here, think a it we next last would no at with I into relationship with time some Rayna, expect to have very well. but see.

Mike Brown

think discussions begun We've started kind those of last we I December. discussions. in of time kind around those

Now they've pretty got imagine over a idea. but the or we'll I a good lot next XX on so their have days plate,

Rayna Kumar

What very for to me. the you helpful. surcharging do final are Great. medium-term? other What countries That's surcharging just in implement making ATMs? progress And expect question a you European towards on

Mike Brown

don't good kind would now, us. surprising are free who by bricks-and-mortar there for have of groups these like because why right countered of to usually we surcharging have transactions kind banks Well, advocate to Okay. of expect We all Europe. the in the the that consumer know reasons would They're country. are like economic big to most any in

It's not us. discussions. It's to up regulator. banks the our It the not really and is really between

see. So you kind it our guess, kind we have them. sleeve, we'll up just They're could quite of wait aces like, play but and to I call of can't

we'll see. have wait So, to just and

Rick Weller

mean, you Yeah. over a that that products off look I be at where take we by a of pressured the some last to surcharge years the economics for really kind that of investment get moved of as make continue living alternative the the have They countries sense. to banks no the tipping point, banking to are few the have. just banks

operate And the kind really tipping way, few they push of this, go so that when that can't what in to any point a we then banks and markets you these get we've of is direction. in seen longer kind that continue of to

would to of kind But or of different be we see. which next. So, have have you around don't said, we'll and Mike signals noises as any Europe one hear sense

Mike Brown

the expand current due that about international to to markets the potential continue our just and particularly are markets a we're in We'll change. now Visa new excited

Rayna Kumar

you. Thank Understood.

Operator

is question Andrew you. Citi. our Thank next Schmidt from with And

is Your open. line

Andrew Schmidt

question. Segment. transactions question for talk break taking DCC and Processing quarter mix if expectations. to EFT the wondering of specifically about A the in could I Hi, was transactions your down more relative the guys. quick Thanks my you on

Mike Brown

domestic think I that's with so, But let's year there. off DCC, with forecasted lot mean, -- make on good we that, Well, much what not or are so in all right a even to we ago we respect just expected forget news transactions. of money what I it's pretty to addition target they and a

continent. We've now lot that of got the surcharging happens a across

We DAF, surcharge, to which us fee foreign access allows is have as well. direct cardholders

is So a that but doing, of certainly garner component DCC revenue. what big we're us products have too we other

Andrew Schmidt

growth to then I double-digit But to back And It as the if is underlying good some of years. comments that commentary sounds there's Clearly -- the growth, wondering underlying the appreciate improves? talk the the you to hear lapping, Is assumptions embedded but Money around transfer. the in -- past we -- Understood. that was could hasn't related there the in Segment. you too robust. about getting there is there, domestic some an have it grown XXXX, like but on Transfer there specifically move as fairly few the there I segment into that assumption assumption but money much

you So, next break the trajectory just into that assumptions curious that double-digit go year. if growth into could down

Mike Brown

and we're to think not you've I both our what -- opportunities international Walmart a huge amount expecting have got WalmartXWalmart product. to with -- do is the in do continue We to of growth ourselves. business grow

of And forth. -- mom-and-pops of is thing a you chains about you And smaller stores of triangle the in at us. that's all kind done about remittance the et look small domestic the for bodegas, sweet spot really if so where and transactions are take cetera, XX% of that's neat transactions are retailers at if this the

know of that. credit. we mean, and their I at both how to kind compliance manage kings are their We

that about worldwide have market -- our We X% out is XX%. of share

really for of we've -- have bigger in the to times is today. growth times So been what market say we higher you rates kind XX international that XX bigger can the why or remittance. than than mid-teens That's

gives the future. sweet market spot thing billion why the what So kings really the to That's $XXX about that is market business. we is. excited us nice this our out there of we're and kind is the we're will continue grow there That's where

Andrew Schmidt

assumption? housekeeping. Got question then just the In it. And tax That's last the fourth helpful. rate quarter what's

Rick Weller

that. to better be kind tell a would that would you mid-XXs little to we be the a it it'll chance than I to in expect of continue that Well,

got little of that As said We the quarter some a out was to the see a third benefit extra India. in quarter. did rate of beginning second because of we bit the improvement rate I retroactive

So I would potentially better little to mid-XXs that. continue a say to than

Andrew Schmidt

you Thank a you in guys. few the conference Understood. See weeks. at

Rick Weller

Okay.

Operator

question Peller with next our And Darrin Wolfe is Research. from

line Your open. is

Darrin Peller

All right. Thanks, guys.

I unpack the EFT $X.XX quarter stronger you the Let help been quarter, segment. than without transaction mix impact? DCC but Thanks. And if what Can same think we're this at on of The last. the just was the us DCC guess last the is in the the growth growth contribution? getting contribution that's me growth from rate the quarter -- just questions start without this terms off revenue I about would reconfirm versus on side or annual underscoring then the maybe around have revenue all changed which

Rick Weller

the additional just growth. on we tell thing margin okay? extra bear was DCC or on is the right not didn't. So benefit The of transactions. we the line already one could No, We The offer transactions those that stimulate not mind ATMs getting the with out additional didn't It's were of is lockstep to would that we growth in out you it got that those in had transactions. that number extra I there. that Visa DCC transactions

they see transaction. could ATMs, the were that the XX% on You on XX%

Darrin Peller

Right.

Rick Weller

our ATMs of wasn't out by of ATMs, stuff. combination So the it's et It stimulated the more cetera. outsourced Visa additional more putting DCC own

clearly... Now

Darrin Peller

Right.

growth is growth growth last revenue the accelerate if accelerate. growth transactions. it quarter. it was -- but mix didn't saw was rate didn't Albeit strong with asking as rate It just transaction it I was I because what accelerated go mix Now the changed -- didn't as a why same I guess, the

Rick Weller

having additional benefit reasonably from be, that the there. with would also lift Visa the quarter consistent that the DCC say, of And second let's part

Darrin Peller

any revenue mean Visa from came that in without rate was I there this what that the would out is what the Okay. way quarter growth break been have of new to the revenues? and terms rule actual

Rick Weller

you didn't only And that folks backwards revenue XX% that the generally -- a number difference and the XX% if little the on XX% to get you'll bit to calculate And we and than get shared with of out first we the is the specifically. quarter. about we second that we we've the it other But more number quarter estimated that of haven't get go fourth about third as number. kind $X.XX quarter it of the from other $X.XX quarter. the in an biased math in is is Well up to put

So math you of on it would with that kind rough a can to be. get what number

Darrin Peller

growth a well -- The you're Okay. Was a that constant-currency of do Money And cross-border the saying sort the be continues to some change a decelerated There growth the just little know of side quick Transfer to follow-up there growth. I side. breakdown on overall the change growth? in in had segment given mid-teens a bit.

break the growth -- Walmart down was anniversary the like. segment it side? domestic just to expect what beginning if And what that So profile or look year the ID was issues side issues full you on it either next on of the maybe or the cross-border could the in we

Rick Weller

transaction agent third quarter like a relatively was. on And Yes. transactions very what in the happened bit price-competitive East. as Well interesting observation volume in saw the in was year-over-year the a the quarter. similar to some second those domestic difference compared brought to in -- Middle lose our was that numbers from We quarter larger and we it because little second

observed of was So there the that really kind large this math of East Middle agent. you out

Darrin Peller

as purposes keep we tough for profitability? how anything side easy in mind well comps about I of guidance to just extraordinary QX of modeling just When terms revenue think in last think And terms should or anything and the question on comps or Okay. in about as guys. the unusual or

Rick Weller

fourth think, the with is showing Transfer Money the the to I side in up strongly and one as revenue yet ID Well, requirement quarter. on that wasn't has the do

pronounced I really of said As this effect saw earlier, that quarter second the of in the we year.

So kind downside. in that the still would fourth that us weighting will on on quarter of be have the and some

the are the is the lift side benefit with couple that Those consistent in epay historical mean, call plus the fourth isn't got. better there of. that fourth that only our I business would quarter from quarter On quarter of math. think could DCC in Visa unusual anything the fourth obviously of our things but on I comps the there kind out does any in the different we

So largely it. be I would think that

Darrin Peller

Well, Okay. guys. thanks All right.

Rick Weller

Thanks.

Operator

next the comes Willi Tim Wells Fargo. our And question line with of from

line is Your open.

Tim Willi

morning. I Hi. questions. Thanks good and two had

comments you The in Did that I your Rick, to first a so some housekeeping at sequentially the one been beginning go made back you Money heard or make call that? say the out Transfer sure, in was just month think correctly. to I this want some there think have – discussion the of about you Can the just of I sort bottoming question. far through or that I XE. around current it into quarter improvements volumes? through And month

Rick Weller

we started having think as of consistent positive Well, the that U.K. seeing something pound was October, I Yeah. Brexit the kind out happen on – that improving was on got sentiment solution. with into dollar. And the against the started the we what the of with

a down kind to saw may recall the And gosh ago. the kind the pound in $X.XX $X.XX, third to of so just about as that of – dollar few you months was quarter we

break at pretty been up. seeing it the had it seeing tick started mark, $X.XX when above lows. some we And much numbers started all-time the so And volume we

good first – trading sign will optimistic that that October. So that of the did of cautiously a see part interest, return that's in of people's that pick-up. and of We're kind the will we

But yesterday we'll see There of wait were there. So, some did on more movement yeah, get that and Maybe some we'll some kind Brexit it out news through here. positive appeared. things we see.

it's So foreteller. good a hopefully

Tim Willi

epay. momentum versus where sharply obviously about the my couple ago was we second better. were of obviously years the all And set product are question And a Great.

it can Who you a a to mobile Now is I'm we all there technology curious, of topics? the over now about that the built us providers or about robust any that you're when is go around effect here two catalog to out providers to the new content leading the network about there and/or if with our winning think sort cloud-based can Is emerging offering within wallet that the you've new what getting years think business to a big that the bring you content? we talked working wallet. it way of want about you've wallet have – there's is those is sort of is realizing, this attention way think are

Kevin Caponecchi

Yeah. This is Kevin.

on hit things. you've yes So a couple different

parse I would So it this. like

technology First this the and about right deliver and commented, enable frictionlessly wallets content. it's to foremost having as earlier the stack Mike easily and technology to Rick

because onto the and providers point you that have are your very than also different. a a with Their I about providing requirements postcard retailer. plastic distributing a mean, easy catalog yes a and But FinTech is very a or safe are than important. company manner have in physical wallet connectivity, So having and needs reconciling a different to the portfolio code a and transaction a location. hook very then J convenient retail digital is different into very,

wallet these preferred become a more because companies players. we've is technology-oriented, Euronet/epay partner kind So, of of various and FinTech really

providing of the mix in and the overall what part second the what sort – is the it the driving what's think question of momentum is the business overall is of SaaS-based I kind the then about And a AppleCare where like of retail combination case partner/Target. digital with announcement the of in complex and more our both brand things this Apple/AppleCare partners of solutions we're our to distribution media

Tim Willi

we're every I last as can you whether done the year is things being ago goods this about subscription-based certain on or this you sort sizable world subscription I in opportunity stuff a the you just like with Target. with I here innovative, AppleCare that in a just in one saw? is slide it's consumer of you've that maybe Netflix respects and if what globally one now, talked think about a in little talked We guess opportunity the about about U.S.? right And end a market month. just Kevin And I one-off market is guess mean think I or delivered a AppleCare Or bit

Kevin Caponecchi

observation. Good No.

a can AppleCare going to subscription a physical offering. retail The So be subscription-based be what the model support initiates from engine any built that consumers applied unknown to is percentage of was location. to

tell in that direct to optimistic, a different merchandising retailer because, sale. a and do way quite We're attractive that's can going than the a physical be story

Netflix, to whatever. of built can Steam solution talked for Spotify, AppleCare the any subscription about, services apply the we've So,

a The fashion. will location. from market. direct it's underserved consumer large is The consumers those not in brands physical adopt every reach retail unknown how a many But subscription a able are services to

about a So optimism of lot there is the globally. the success solution of

Tim Willi

Great, you very and thank much. That's I all had.

Kevin Caponecchi

And Mike's that comment comments. out I in more one guess make I'll came

into down bite-size into something important that's relatively the of pieces. point other something is price The feature -- monthly expensive, breaking of renewal the

products. how also there enthusiasm lots And and about of a an could used be with different of lot is excitement that

Operator

Thank you.

Kevin Caponecchi

please? Operator, question next

Operator

Heckmann question Davidson. next from with Our D.A. is Peter

line Your open. is

Peter Heckmann

we revenue count payment in Good cloud, high manifest be Curious Clearly do on the and up we'll start see it ramp margin. included in see the as morning, you likely it transaction those gentlemen. Will services, to how integrated results? the well? as

that? lot prepaid. … may sounds But a these how we like, in And interpret there some It there's of be should applications

Mike Brown

Yes.

Peter Heckmann

Go ahead.

Mike Brown

think, then there, That you'll Pete. sure. was your yeah, other transaction you But Did I a was. understand question, little Rick? bit question what count other for I out the And cut the couldn't in see

Rick Weller

No, no.

Peter Heckmann

Just perhaps margin. see, But through a the revenue those transactions. but very -- essentially, will transaction fall at the we'll coming cloud-based high per bit, from be information

that modeling. about in So should we think our

Rick Weller

Yeah.

our call revenues we're of and of kinds As we from really to type service different like it's licensing think projects going about service recurring across One let's get of okay? -- okay? it type to be categories, technology, Mozambique, is, three going

central that get to then installations the are other that from banks types of transactional we switching further infrastructure. to are lead Those going XX in particular involved revenues that

we of to or product like that going And the whether AppleCare Xooms that the world, like get we're you -- about world, developing talked of more with Finablrs from as the the say, also it's better we're the here. believe or then, connecting transactions. And just margins, we've

areas is better recurring that going numbers margins see several revenue of But transaction transaction. come monthly is continuing, we strongest would that there's driving the type tell our So, in. you that would see to it to interest I us per be that different would give

of we So way. follow and to see more more we'll products, plug the those probably you come of than think more kind in But it where along I it we'll up anything. with successes, have that's as

at modelling, for ability your But continue a would anticipate to I that this the I better drive margin. to gives think more transactions us

Peter Heckmann

just one And housekeeping item. missed apologize, Did And Got EPS I benefit this helpful. it. it, to that's tax I if then quarter? you quantify the

Rick Weller

We in didn't But it. kind the quantify double-digit range. low of it's

So to call share. it $X.XX $X.XX a

Peter Heckmann

you very much. thank Great,

Operator

next And Jeffrey you. our SunTrust. from Andrew is with Thank question

open. Your is line

Andrew Jeffrey

Rick, morning. and Mike good Hey,

Rick Weller

Andrew. morning, Good

Andrew Jeffrey

and being talking little at about a affecting you invested as XE's the business of read a lot lot BXB it some XE, with profit-oriented every FinTech of capital in we what high Brexit competitors Is your to of is So regard aren't that Obviously, how Euronet cross-border about day in you're itself in what a makes -- of side Can sense. competitively about how positions XE as XE? market? that talk maybe differentiates generally. valuations bit the in

disruptors really as some it's these I is? bounce competitive risk from are suppose aren't that I How And the you Euronet isn't confident pound. of a as the the in good price-focused of to there with see transactions strengthening that maybe said as

Mike Brown

an that's thing. interesting Well,

giving traditionally -- they're point a investor with we competitors. lots do -- thing is there free. A So, that -- lot The money though I out of were people sure for nice They're I everywhere. we XE everything have that and have higher-price got we blowing they've for mean near product. mean

work guys They and might of for a a bit of $X,XXX, $X,XXX $XX,XXX medium-size be for where FinTech XE's a numbers or somebody little small individual $XX,XXX or for an CFO were $XX,XXX higher. kind these enterprise. where sending quite So, $X,XXX

interesting us competitors transactions both middle this shown we've we medium have been our or scale that way. And might that redone -- you acquiring a I more So, we've went though there's for kind range. we our lot a us think downscale is website and the upscale say. of these of since What's our originally FinTech have big apps, market in

So, might we also do see see say. competition larger market you a but we

Rick Weller

when them you're struggling because you would add see because our a I and folks advantages to -- this a and compliance efficient of start-up really of with attracts things are lot And is process we've beginning in of their publicly these got one to that's like very that really struggles more business what compliance. ask

All United with the we it that it's is wherever compliance. it's regulators with are in the Europe States of whether concerned deal

level And some that of to the these start-up, have folks compliance. attention don't of same

find It's competitive got effective an use. process. engine simple. So, is compliance that they they the we've rates. go really easy attractive worked they on come When really then that through efficient making in, It's and to

received a kind that than so certainly a lot experience ever And what of bank. at they've better is traditional before

of advantages other well got FinTech process we've compliance and our one how think honed. of some I the our against guys is that

thing the So, seen get the back more subscriptions. steam we'll But get more we've really this opportunity and as welcome through at Brexit we to it.

Andrew Jeffrey

that. Appreciate Okay. Thank you.

Operator

our Company. is Needham And Tandon & Mayank with next question from

is line Your open.

Mayank Tandon

revenue Thank you. we side Asia that and maybe EFT aggressively contributing side? growth more on expanding to EFT Southeast the can and on could the talk in LatAm start Good line morning. Mike, time about to the you when and on expect growth transaction

Mike Brown

Okay.

okay have a world by it's allowed is or aren't get not challenge, got regulator to countries a into that country in the a to operate countries, and you've an all a EU English-speaking actually So, the because in of new the own to institution ATM. most bit nonfinancial aren't

in got that it's get -- So, first to makes slow-going of there. kind at you've because

changed took a and working we into long had we that sponsor -- where years. -- could mean And kind would takes current got that find that two You've on you bank to change. the two that market of rules its have them we rules to full working before we ATMs were in, Visa been we've a XX the sponsor because regulator only we're its on smell Visa for number Mastercard. I change -- is then regulator you potential rules. get the And and This take the in basically bank

so, now. on five we've markets other -- working about And right been on working we're

when I that of get go wait in We that bust, I see. will market. one out, whenever we'll get next go year, into to to so, maybe And one the says the feel then just have first and we'll confident quarter but next can rather regulator

is next we've and that the XX got got throughout big math for one only but working year. the on plans we've meantime, the now, in a And ATMs excellent it expansion

so move really next our do just we'll needle But actually will will EFT it move year our big. ATMs so. definitely no matter our by how -- XX And where because is make don't it do good they needle. darn division

Mayank Tandon

capital capital then still M&A And be you you're from looking highs? off helpful. you very on That's a stock helpful. the main the Any allocation Or quickly is theme allocation consider Would could comment its buyback? that is perspective? around Rick, very at would especially a given thoughts that

Rick Weller

Well, on saw the did when we pressure in the bought third price. we some we as quarter

we've some. as to any see probably mind. state might guess prepared if opportunity we're dislocation, itself, we have in be -- we But some do said buying that. But past, wouldn't plan don't presents I the if in So or number we specific we

Mayank Tandon

acquisition? And

Rick Weller

We've get looked And latter just several found. a on that matter had looking acquisition of to them. There's not issues whether the because always fell we we're them the table. of at that we're and -- we quite finish days promising It's apart some -- line. or just the in examination

expressed out some there. the valuations exuberance to some of continue maybe there's in that see We irrational

would we So line up what if if can we we we they're money, how see that can see the growth engines call make Pac-Man in valuations being interested we're with fundamental can acquisition. that not just

growth We're business. in engines to our interested

some We'll finding going. I'm stay one. So process point, the keep But sure successful at in to be tuned. continue look. examination we And we'll

Mayank Tandon

Thank you.

Mike Brown

at over operator, And because some the good look probably right be top stuff, the weeks. like who of thank And you. of we're hopper All I should everybody several hour. our today. to question Thank in the joined the got I us think communicating forward that next the to last we've I'd

Operator

participating. this gentlemen today's concludes for conference Ladies Thank you and call.

disconnect. now may You

Euronet Worldwide (EEFT) 23 Oct 192019 Q3 Earnings call transcript