WU - Earnings call transcript Q1 2021 | The Western Union Company

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Operator

Good day, and welcome to the Western Union Company First Quarter 2021 Earnings Release Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, today's event is being recorded. I would now like to turn the conference over to Brendan Metrano, Vice President of Investor Relations. ahead. go Please

Brendan Metrano

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Hikmet Ersek

afternoon. this joining thank all and you Brendan you, for us Thank

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Raj Agrawal

that noted. I otherwise Hikmet period results you, Thank year Please to note afternoon and first compared my to everyone. will refer the good prior quarter comments unless

higher grew were from improving by limited net with to quarter a growth fourth quarter, down by white to widely money CXC gap this increased impact in RPT CXC increased digital but direction from white and sequentially on which three do revenues, X% impact digital in by revenue increased reported the money hedges the the transfer vantage digital to currency, $X.X and We CXC constant partnerships led between results, revenue the growth quarter. digital quarter business in revenue growth, transfer remains in a XX% transaction X% revenue contributed reported right or principal transactions XX% account in a to money wu.com. transfer. or move in account the and on or transaction up quarter. principle and the cross-border the had a business environment first partnerships currency trends billion XX% growth XX% basis reported X% quarters. reported growth mix mix. to basis. Evolving to the constant transactions driven the first Mix basis spread continued transactions segment of transaction Total impact for Currency the digital revenue high transactions for XX% include consumer both account of currently. and a retail. per a constant the pricing with transaction business, Digital and the led both coupled of contribute by to and and PPT. increased offset Moving account translation, from label digital money CXC PPT from to contributed lower digital over on quarter next market from XX% more to partnerships between on growth label constructive. currency, the X% transaction was mix behavior our point, per moderate CXC Retail continued in currency spread to constant XX% BXC the transfer In constant or expect to transaction on a partially Similar revenues. Total impact changes with wu.com and retail basis broader or digital

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sequentially, payments to the trends trajectory trade. border of the remainder quarter. and The consist of we the in X% the bill for U.S. of improve total decline in and XX% cross company Other Other and an due will in of quarter. of the the was with year Argentina declined the revenue and remain retail improving COVID-XX continued However, expect recovery of to a depreciation The ongoing Argentine X% money on in revenues segment represented represented peso. and primarily the revenues orders. impact retail company revenue broader revenues revenues

timing Turning reflects XXXX basis costs the in the marketing margin expenses, compensation compared to and to in compared the on and an related investments profitability, margins initiatives of of and the our and program. certain changes FX. margin primarily A strategic to in including margin excluded in adjusted was how on COVID-XX impacted related XX.X% level in XXXX, prior quarter year operating operating XX.X% and offset expenses partially period which basis, and investments restructuring consolidated GAAP decrease a by XX.X% to

had impact the on and quarter operating benefit prior the profit million of in negative in of a $X year Foreign $XX exchange period. million

the $X.XX initiatives operating year bonuses expenses. should in and in the the margin comprises total a to XX.X% year's foreign signing period. compared segment due was an increase was EPS effective revenue. revenue adjusted tax was Other Year-over-year to last an rate, restructuring to quarter was GAAP strategic tax prior the the discreet the in prior benefits of prior driven tax company quarter both sheet, period. factors of tax of At due margins, and repurchases, $X.XX our related was XX.X% from per The GAAP XX% our to comparisons in The decline tax EPS due cash and and million, flow in in Earnings earnings $X.X margin company basis EPS billion. in rate almost EPS compared the flow $X.XX. be of that quarter, effective compared million. range changes of increase of share XX.X% [Indiscernible] that rate in operating activities between a period Earnings and from of compared tax expenditures XX.X% in and billion XX.X% prior with total rate CXC Moving $XXX year to period rate the margin end primarily of in XX.X% year were driven benefits. $X.X and share investments quarter exclude for debt composition in and $XX compared effective higher agent by segment in reflect increased adjusted the XX.X% cash the decrease year. marketing operating the Solutions, by a expenses. XX.X% charges. or lower note lower segment the effective BXC lower growth, the full cash in compensation on was margins quarter approximately had normal was we company's and margin first and balance Capital primarily operating income, in tax operating offset the was decrease the operating decline The the year impacted in in compensation was operating margin. in same Business margin to to to to prior by the period. quarter

$XX share new quarter early repurchase outstanding our of of of direct $XXX term the historically prepay rates in a shareholders consisting April. $XX low we we our first and of share due XXXX quarter was in notes interest portion which of million count repurchases. the million in to and Most these at million we in December in authorization advantage $XXX used the first share end returned million to million year. this took to were We dividends During quarter, repaid the loan issue expires notes. quarter remaining shares, in and of under had The XXX

release As operating Hikmet affirming for outlook, minutes ago, EPS. a growth expectations and XXXX our earnings we few GAAP updated in raising noted and financial margin revenue today's

due expenses We be The XXXX. retirements items are also target revenue the quarter of on GAAP $X billion. offset related the investment, in will reflects digital increase track in to EPS Both by in partially results. these an sale reflected our company's of of early to exceeding second the achieve notes

reflected Excluding that be outlook. the conditions pandemic. the global impact of unchanged, or EPS macroeconomic these current the material worsening COVID XX items, our XXXX EPS outlook two within assumes have will no adjusted we which outlook in Note

of approximately expect partially program reflecting a revenue full generate from basis higher mid-to-high initiatives. grow to million XXXX expected of investments three-year benefits XX.X%, We which the the impact constant Operating or savings of margin will basis, single and operating is on growth and digits by a approximately excludes also year revenues in by annual to end mid-single-digits on strategic we currency $XXX offset inflation. our GAAP that expect XXXX, productivity expenses be Argentina

our be a retirement expect basis. $X.XX second to be and tax to range GAAP quarter EPS EPS, other the be expected range in is teens benefit sale to GAAP We that on income for mid $X.XX. XXXX. approximately in year in rate to $X.XX, $X.X in those now which is effective the of of investment the and Adjusted including range expected an adjusted of will net in expenses excludes debt a occurred on $X a items

XXXX worsening include with progress. over quarters April cycle the the of as some and progress will decline continued quarterly year. Note our on expect I quarter revenue, saw over in no how year. positive the the we results results, Starting the over growth the in year quarterly pandemic strongest may underlying we that material assumptions largest second rates global of caused the macro in for year see momentum we environment prior effects as to Given for we COVID-XX variability and of remainder moderate improvement context the the think provide that the

stability the XXXX, of trends the and expect back in XXXX. a the of stability as that in quarter second delivered we mind Keep similar growth onwards For digital and had we in given general of last our and business the from growth half exceptional COVID-XX, third year-over-year quarter year, rates. fourth result

should digital for year. of remainder revenues in we growth $X transfer billion year this somewhat although than money So moderate the rates expect generate still this to XXXX, more

retail experienced in a back Our it quarter XXXX, business occur significant recovery gradually. of decline second come we quickly to began the will expect while and

As we generate expect growth in a result, retail XXXX. will

Other Our by Business Solutions and in were COVID-XX adversely Revenues impacted segment XXXX.

So we expect that those businesses will continue to rebound this year.

Thank see margin, we Moving the and the half current confident for our competitive we will business opportunities on based underlying optimistic will are to the our the and second full joining macro that environment we year margin quarter a solid we few enthusiastic position to ready the on operator start outlook, for to year, our the margin our realize and below to significant be fundamentals, off over constructive, the will remain year and in be of for expect us today we will To now margin position outlook. the our beyond. back wrap year that questions. next that are up, are take you strategic to year above while agenda full call year the years

Operator

go First instructions] ahead. America. Kupferberg of question Please [Operator Jason comes Bank from with

Jason Kupferberg

here on job guys. afternoon start here. good Nice what quarter that's and with I to the wanted Thanks,

So came revenue at your X%. adjusted constant up currency growth in

materially to here your that side of also And outperformed with line there sense X%, digital the wanted in more be that to it of of primarily expecting was get a was so the I which expectations? been or other whether down QX upside had was better. surprise were you CXC think business areas the I

Hikmet Ersek

believe growth Hi, the coming good we has the base the see again has end, growth that Obviously, that are well for it's dotcom back. I business and And you how And that is digital is see coming acquisition been recovering. think well. We are added the of most our customers, customer one, the company a we we that our recoveries digital, delivering. already this And also to new look, important of we with performing $X but COVID-XX our been business and a been you not business retail our using on if the over are really and compared I assume the do way. more business on to lot competition, People Jason. a and the back doing? think some helps huge all part well, doing but as I Right? targeting big rates question, is extraordinary a western.com are certainly year over. business. think It's we from see, X% see billion we very plus retail coming still and business. there, business has and

Jason Kupferberg

factors just a that last currency favor wu.com? may there your in first one some wondering be XX% just during were And in growth stable, looks quick to from quarter accelerated wu.com constant mix quarter. like XX% worked so growth It the revenue the transaction if Thanks. there was pretty

Hikmet Ersek

not, Jason, not really. hi, Yes

was expectations really it's as the digital you but playing get to quite QX that stable continue and growth according good were the and throughout say this lift out I think quite We RPT I so from and the and business relatively business, to just And that stable to business. dotcom in said, stayed as we QX would things entire in overall the year. transactions the all the for yields stable the provided we to on well. our dotcom see QX,

Jason Kupferberg

Thank Okay. you.

Operator

Peller go next today from Our question comes Please ahead. Research. Wolfe with Darrin

Darrin Peller

growth to side trends, at the folks as more the that half And we on growth, had rate strength, the When that actually grow. if trends, digital lap the retail March part because sometime then of you think of get going the see. are can a give can if to guys, do again? XXXX, quarter I call sustainable question last the little those would looking we on us to you're look big thanks. the specifically in digital, exiting So If is, saying how also detail to Hey levels retail top you it on second compare Thanks. into good will to we be we second start be on growth back digital into April, year? it's this getting you anticipate

Hikmet Ersek

Yes, Darrin. hi,

address Let to me questions. try both

the outlook have The first and we we're to the and $X yes, that's quarter going we expect, in the should that's growth gave we year, second, of total in expect what one, largest mentioned because and digital year. this still initially third when happen quarter, in is then the earlier going get beginning last got revenue. but growth to you dollars second fourth And, above billion what strongest as so we to Digital moderate

give really probably other that growth depends XXXX sense of what With to be, some to a but to that it's year. in not you the back get impact, So that be coming like half the to business. things are Certainly, year, there'll the but this a overall should going of we're retail, levels other into going have Walmart respect business, initiatives the happens. and rollover on we it second potential in

So those retail will goes. part also business play where in a the big

Darrin Peller

customer think some in to the active transformation you discussion user of some up Hikmet, the I migrant on taking being pretty over been And there's profile or it growth my have Okay. to westernunion.com the monetize underbanked around and follow of a company. trying guess of digital I really you more. alluded lot strong. this is of base

again. of year? progression So guys see that Thanks around expect to from you throughout kind this what can we

Hikmet Ersek

where to more migrant Western are we loyal Yes, that to customers customers we are customers. in good directly we communicate know communicate are we more XX with westernunion.com It's direct and countries what directly westernunion.com customers these Union. often, really with have them. via use question. customers. we access can and we and They do, our And Obviously,

to UK to they and year I that. long-term in instance want going are which Europe in see Union with learn area, new Albanian Romanian customers Western we Western are more European We in we started with big International we a focus on looking tests license, our at really But opportunity here. will And that. that our trust also to -- besides this Bank us. Romanian. we Union us services For be in speak Italy Albanian, the financial Right? customers speak they They The tell products services. really

We growing. million have about in customers and X westernunion.com it's

a coming new the business, just customer is long-term. services the is and adding Besides core our You having numbers transfer the opportunity. additional which this acquisition, business really big money saw in

Darrin Peller

guys. Thanks Understood.

Hikmet Ersek

Thanks.

Operator

Our comes next go from Tien-tsin ahead. JP question with Please Morgan. Huang

Tien-tsin Huang

the terms the of about I user million business, XXX think much acquisition retail you X things could your that? digital. figure. can new, I I I customers disclosed remember If think and Thank million afternoon. Thanks, so curious how appreciate active active on and about point good like you costs, some it I'm you've I'm wrong, million is in at discussion X the learned go, you. traditional it customer today of that anything that in where curious be how

Hikmet Ersek

me that remember. also, Tien-tsin. question I Sure. earlier you Hi asked Great

want them XXX We million of have the focus and segment are it senders customers is of the here. side westernunion.com some they kind with the we at in receive obviously is receivers. in the half more side, the that obviously Romania, it but also or about customers additional beginning customer Right? know is customer are globally, in of more Poland our did them service to services, is we half us tell get financial Morocco, it So in send services, and on from

go, first directly ways often business our we two directly all more we So, going are there acquiring and the to with them with are usages, we westernuion.com know that. their our which to of agent are customers

customers. that to The and know, higher second to to saying would from also and to that like have, kind to kind with as and focus like Turkey tell test repeat they money because are acquiring building additional also groups, thing our you we consumer example okay have the from also we dedicated France them services, ecosystem services. And on we send is locations, of us some with locations our One of, they Germany to they insurance have money this do traffic, they are AXA. is like these we customers ethnic would Morocco, have send

to revenue insurance largest test And want the seeing that we our company. are know companies really them France, and I you services, next the tests and stages, As opportunity with see one the is our worldwide. doing for in a long-term a really expanding AXA customers additional of

Tien-tsin Huang

are any if doing you see way, there, follow really guys I'm front if glad is trends that's, you're there up mind, that's the that because just hear. listening quick great conversation effort and thanks that. curious that interesting that's relief an a for now My you? could share segment the you to our by And great that. India to for India to great, able you Okay know I receive important don't I'm on nation

Hikmet Ersek

important for mean obviously is India very us. I Yes,

all, First change remarks, in receive I said of customers make They billions have the when there they money. there. my of we as

imagine employees that there, are very know We seen there at bank been there. is you still office private not but mean, the have our daily. we as, care From the that India, see essential times, taking in all have only over post difficult all services, open And They family as the also They business you that locations are are side, of can I locations. are world. we locations, going XXXX's looking through Tien-tsin.

have we there, the know but you coming payouts. retail growth then they dedicated huge are networks also is As account locations, we And open. biggest from have

a network India. huge have We in payout account

India in You people the the for for sending People that a we can not people in of easy, many services, fastest people sending used goal is are money the money that And growing, send paying health in -- in lot, sight. part is also other and fastest things. that and getting me is helps an the the situation growing essential money numbers, account I not the believe this our thinking relative and real-time absolute and business around see same basically services are accounts. out and because it's big India using is mean directly really our but to in their the about but world and

So, thanks asking for that question.

Tien-tsin Huang

you. Thank

Operator

Thank you.

Our go Please Rayna ahead. today from next with comes question Kumar Evercore.

Rayna Kumar

Good and Hikmet Raj. evening

and mentioned if you there And the was partnerships. Could white follow-up will there between your As my have CXC your that impacted by that specifically upfront. ask or also talk which spread about positive commentary, driven in a transaction you changes, label was negative may largely I spread? revenue your were pricing any

now, initiative how expectations? can about you. pricing while Thank performed you in quite that's for talk dynamic had You've your a versus place

HikmetErsek

Rayna. Yes

take part. Let first the me

my a spread, are that white that year-over-year spread of relatively of stable quarters. revenues white transactions you'll what have the the you're number label. the quarter have exchangers since and from mentioned third label an On as there is next also to I going the three pricing is But as last digital mix, having see standpoint, are the digital we the And well between comments, seeing happening why we as the impact. narrow From reasons been an that spread. and that's incremental in transactions not year much the really yields causing and as will have, of

also stable a this relatively year in for wu.com the and pricing We is -- retail that significant having rebound then quarter. and second you'll the starting is see

So, bit. to dynamic in the And of terms been that we've going we in is narrow quite spread have putting place. of number a then things pricing, a

technology at the time We improvements. all are doing testing looking various a lot of

Raj Agrawal

and and growth that started we very westernunion.com. area. have our know as that. customer great our Yes, business We the keeping We review in it's had I revenues do does to just Rayna, a growth and a good it big question the a impact acquisition still you on just, another extend

business, Now one people really dynamic this be worldwide who return pricing maybe will and [indiscernible] in because especially we also do in it of the also the future locations and in there best the we retail great the we see I are encouraged that keeps tech hired We very show also hired activities comment was so the us hiring and by on very dynamic am And works. pricing flexible. pricings how experts executive really part. great and the people. my really They that that really

Operator

comes Stanley. our go ahead. James Please Faucette today next with from question Thank you. And Morgan

James Faucette

your on for much A on and you how profiles has in, of talked all very mentioned, the their the a couple in their customers, to I developed, to color of thanks little them? if was of some wondering of see little thus added were get profile setting you've and any period there those this kind of the bit has have quarter year I questions your change was any and on you from from engagement idea that if far if I'm been just last color customers retention different. June wu.com that customer trying how continue of details bit in ongoing a to am activity business pandemic follow-up just at me and generally? the first incremental as year. about you nature mean your that Thanks things particularly

Raj Agrawal

continued These of and The it's just the business level I high or has say is continued customer. a frequent drivers The transacting the Principal customer growth, would impact company. would say, a one a customers in prosper higher quality key overall PPTs having to at so was of that's part Transaction business positive principal strong. the Per James, increase. a Raj. really at are profile have I this very that levels and the be to the on digital the overall of the the of retention

HikmetErsek

still partners we a little an behaviors new business. is really lower Digital our doubled. late hallmark often. since on -- they higher are XX% to a on to mean westernunion.com, perspective, they are and these or customer But of more that Western know customers, this XX% mean Union then Right? retail than also digital really incremental flexible I a the do they partner, it’s different the around money -- segment in wallet announced And sometimes XXXX our things account. and They RPT, which trend, had the use send and lot a are put bit more that to core look in use different really revenue great. to customer to of sometimes just is I are RPT, more loyal our we often behavior. their

markets really it's it's it like incremental Western Union, switching all customers with That's extended not the you portfolio news the good us that -- suddenly to here. are and and know So, share. is retail Union extended approach Western to the the

Raj Agrawal

get to gone wanting customers and ever money and think people of need the factors money pace. the away, to terms money, continue than the to markets and receive higher before Yes, a that I send -- in it's other receive at digital frequent hasn't

James Faucette

can it and relationship a the like Yes, looking relates or stores? international you about relationship as get incremental My make Walmart, good it that's just great and from question you're them. to seems job little retaining your from I this and what know for available you doing you think detail expectations, it Walmart there talk there to a other well, you in as does was, Walmart's more information your bit expected can relates guess specifically as contribution I

HikmetErsek

year, own organization impact have sale, customers, on relationship we is this which we yet part marketing and the -- this around we our customers, give the even start especially that there, it their since hard Yes, Walmart by relationship upgraded within with Canada the multi-years to XX% new of the like have with be of important them built as activities and speak it that. account and XX% incremental I QX, we we We with are Walmart our really brings enrolling see our forecast. the U.S. excellent. we And actually excited already locations on enrolled signs has -- locations later management key sale we the and that stores. we team incremental worked Walmart focused best already starts percent we is customers with our and that got, We that excited of The have now. very from definitely Walmart is Mexico the or definitely all that the have very and we announced. of the about our our growth good They -- really for numbers of But we a I'm are to enroll. We to had experience Walmart. very that. customer will for adapted about will and point point we excited XXXX enrolled. revenue will cooperation an also We didn't know in announce And to about additional rates been of to that hope relationship

revenue our management to and the at drive the have there locations. account We own transactions key Walmart

Operator

you. Thank

with our Ashwin from Our today comes Shirvaikar question Citi. next Please go ahead.

AshwinShirvaikar

Raj. you. Hikmet. from Hi both. Good you to hear Thank Hi

Hikmet Ersek

Ashwin. Hi

AshwinShirvaikar

Hi.

that? monthly average So, nice it sort to does mid-forties, upper down wu.com. of my type or like may April quarters trends? the Obviously for you growth? forties levels could necessarily the with trajectory. have be this in go of back quarter-to-date this could last comment first few for to the on a question users guys growth to And you you mid-teens I sustain of type talk type might can trend if in know a to maintained be you more -- have that quarters you is what active prior regards over Do clue if four saw about in growth don't you

Raj Agrawal

Ashwin. Hi

level On I the can that grow transactions users, average start to of are year we will strong, for the because monthly like from say business. and the absolute active that will over significant growth continue the revenues last be to but we of

customers So, that business of of it's just with and the customers they're healthiness but high very has what doing to the of the been of a our level the we going level expect and continue. over, function and numbers

HikmetErsek

both competitors about mean always and is like Union billion Western we it's of big if a think, that of on a Ashwin, to this billion I you area. the right? as And think number is revenue, amazing are just next that, contributor $X it's almost And better plus contributor only still, $X that. an westernunion.com digital big plus, revenue

are very my we So, and an that. it is I'm and impressive team how proud expanding number of really

is it really growing very something fast. definitely So,

Operator

Securities. Please Thank go ahead. you. is Guggenheim with today Jeff And question from Cantwell our next

Jeff Cantwell

my I wanted Nice one results to digital. afternoon. taking you about here. Thanks for question. good ask Hi,

also it’s modernize/digitize the digital all are migrate maybe it's data, oftentimes sounding Now prepared base. But think be how you occurring the your about frontend, on what's when the digital as to yourselves revenue remarks, we digital, that to to about and the on internally. well, adjusting is your et we cetera. growing I things tends might meaning on talk Maybe customer cloud, we you're other like based are want the side thinking doing which coin of focus cloud, be how to it's now

bit yourselves one I if And there's I'm you you it operationally? by partnership talk to could So, internally been And progress on about is wanted What that? maybe modernize/digitize reasons us the and that we been some of Snowflake you the backend. little asking making a guys. ask to saw up have got thinking caught with because their you doing you're

generate way be So, us, hoping with to maybe some seems share it savings was a I might cost potentially. like it you can nice

about So, hoping I talk Thanks. if that? was you could

HikmetErsek

Yes.

was that, was we I not here? the well. not do What on side, how digitalize platform? what also the -- how it's think guess. we that our the but that sorry only question And do we connection that? You send receive know do understood is on also do the What I I side do I understood,

line start to your if like if Let -- invest more welcome. and Well, obviously you you would than front me something, digitalization technology. the add Raj your didn't like would to happen -- in digitalize on don't

recent front to know being settlement in You announcement and company our what we in to allow announcement multiyear recent look, a that tech think things put digitalization. I putting on -- currencies. our so really only the investment of we our continue. big we to beginning, the that on perspective, and big XXX clouds And on -- also going our line a the settling are like And are the successful new artificial having company, intelligence, tech are That's announcement transformation part going in just direction. been really has being to XXX spec that's did system program

currencies intelligence, money which to to of compliance huge yearly, our due benefit our to artificial and of and in use We are settlement billions moving that's we due a due around doing monthly, billions technology, in XXX programs. our program,

nimble So, -- agile. to platform and do our continue doing this faster that's and more going to more

on sometimes and got and know money their it accounts do And and to in the from using receive sometimes sending for second question use people the people are question are that getting We cash the that's out they you is money part wallets. to The your I side wallets. if their money maybe, other on also side. -- -- if of more sending wallets that your on more merchants, available second see area, wallets,

Sometimes they their put it on accounts.

I you digitalization. think we want with that, Raj? new segment see there's to a our customer Anything add on really

Raj Agrawal

you Jamie, this No, and it broke up is the beginning at right?

Jeff Cantwell

Jeff. is This

Raj Agrawal

settlement the beginning. That's there. with I you a But it's broke I we I sorry, yes, beginning. new the think about talked at we Oh, system piece tell up mean system. went brand settlement couldn't biggest live the at really

to many moving the our are We operations of cloud.

of of how to All we process in these things to translate down road, making and and are engagement strong. more can the provide customer, cost savings, going just feedback into even that terms information the interact efficiencies the but customer with of also not very in terms

right need the mark, we what that yes you're to So, continue on do. and doing are exactly to is

Operator

Thank you.

Timothy today question comes from with Our Credit next Chiodo Securities. Suisse

Timothy Chiodo

Thanks change little a I gears to a lot. want bit.

the their very use bring the extend could partnerships but just why be cards, good consumer to times, that to help You and to of potentially Visa utilize mentioned is a combination, [indiscernible] growth you, and a it account your whether case it it options, choice card, local they see does remittances, light or multiple MoneyGram of would with we've is some in if this to they with little what I particulary transaction in like know that, out some the the your cases? Direct call strong wanted or or talking also you about platform it to of I that publicly past payout talked to payout your account partnerships send to expand life more. down and when bit come within would just direct other to use account be about Visa your capabilities, the are to would

Hikmet Ersek

way obviously cases partnership. access We Right? if send thing MasterCard, you we on do have same Visa, partnership direct So payout with the with money partnership also. the in with bank their by use to switch, a use don't we other we accounts, depends directly most the it is the need have have others a we companies our we is, real cases. we faster account that the which the time. go customer And more of have most to also efficient and important accounts And do the thing

from still payouts bank is a payouts. not have Bihar if all of The use you to customer to bank though, Saying can the X out headlines, not do with Saying mile to the customers, to is the site for but cash the payments could credit India fees. serve the or do say cash Union to send But are the up So to account excited, money we different and a in cash customers locations. the from payments, time, should dropping send for to school pay they it a very, most understand worldwide, there's wallet. let's part last part needs no card that to cash get here yet. money of digital a We is the the biggest have the customers adopted people The the We systems We to time we account account definitely retail reality or all but into is world, online are do is Western Denver paying the payout. in location growing on we that these processes, payouts. it go there are is depends some direct receive reason payments. pharmacy and needs. also in wallets point of advantage money fastest customer do big The to depends the that, Mobile there has no for cases. they the to that most billion and and growing the that I payout. some is where Union payout, On and get wallet money real and forget the probably also And still have the and money said dynamics. as pick earlier, the sale receipt sent read is parts infrastructure healthy have fastest go sometimes we infrastructure really of there challenged. do have time. to today Western it, do and We've directly

Operator

Thank you.

Bryan today next with Our Bank. ahead. question go from Please Deutsche comes Keane

Bryan Keane

are guys, doing? Hi how you

Hikmet Ersek

Bryan. Hey,

Bryan Keane

I'm doing well, well. I'm doing

And through to like might we of look some the to comps. Maybe normalized large there, of some get digital think Solid thinking the anniversary we just results as a rate what like just about ask trying on about partnerships. think here, what in margin, then how growth as might rates, business like in the retail if secondly, wanted you're drivers digital. faster fast and growth, opportunity get back, I'm growth XQ margins just you of on to we about comes maybe XQ look things tougher the normal some a growth into higher to typically, revenue sounds and going and the on the you'll margins, back get some investments but you higher take revenue had or Raj, it have that of push bit the to then expire will of half? a Thanks. why those some XQ maybe larger as little

Raj Agrawal

Bryan. Sure,

like well on and as Hikmet anything. if can then both to address to try in jump would he me Let

now, if had. giving but to then an back But a it Day, in if to contributor topline. place of had be we happened growth, becomes can have XXXX, overall digital good we're because fall months significant to digit happened XX year ongoing that None the basis, we the a back get that see the us On for the expected grow long-term I you XX% of we outlook range range. we take right be could just to what to Investor XX% growth level in company's digital it would that a would but thought the love it we with that not to last on

Hikmet Ersek

bigger I is a sorry that, much the business said Bryan digital think about just But I you. on that, base interrupted today. think

-- and a company. I'm with bigger with long it really plus stronger base I of but stronger confident we is opportunities it from long that the is give term a a it's digital growth term. long-term don't a stronger hopefully, growth, business because bigger guidance, So, this of are growing about year, growing possible term, growth from possible strong billion the with dollar long and

RajAgrawal

that certainly, company. about million sure is we we're business is thinking the talking changed the now thing In overall And bigger on I around and margins, piece pie a about And it's of becomes it's of for it bigger one so right. it you business, billion said impact. overall $XXX $X business, were mix a question think the XXXX it will then have a your

We some to spending the in quarter. have going continued are second

average half is gradually is with next happened and of And above be so of other second the our going the growth dip given But had year best quarter. current quarters, year the the that we the full on three then half going in those any the quarter it's The have last what I spending, second just probably to on to year about year, second full revenue average. be timing the first component it's components. to is below will going improve business, would the based margins in view say the of not the and

Operator

you. Thank

today Please El-Assal Barclays. with Ramsey go Our ahead. comes question from next

Ramsey El-Assal

consumer Thanks to deals view product particular, your or offerings sort gentlemen. and maybe I wonder in strategy? comment weren't some of ago? innovation? if on more two kind it kind And the that of in could of a development positioned today. now my evolving year Are on for your the context you to taking expand maybe of breadth do your product focus intense in question M&A is of your you Hi

Hikmet Ersek

technology strategy the we much looking side to anything could think offer do we at effects? which also is probably, is expanding the It ecosystem, aligned then could obviously, better exciting M&A faster, in be in That's really first find platform be with synergy Are which way very M&A companies support opportunities And in And make the which the is strategy. look third strategy. also as our So consumer would to our are the something But time, with corporate model, there there one with some is to very you vision strategy, which a is technology. with in other our I a our our services, our there that's our to without looking way, of connect higher obviously is our you the it. at can to additional really help are that the could we other is all that operating a existing environment. agile, strategy. if us companies customer nothing thing. business communicate customer grow, will on all better there, faster, more ordinary we exciting,

I the the this is it has so, environment have to thing a shareholders. obviously it also return to looking And for mean, be good are most at. we has important

Operator

our next go Andrew Securities. And ahead. today with Jeffery Truist comes from question Please you. Thank

Andrew Jeffery

noticed I I the think I capitalized afternoon, for appreciate that, some time. notieced having quite good low risen that gentlemen. costs you Hi have We four stayed taking agent for quarters question.

Hikmet Ersek

bit? a Well, can up It's you you very speak irritating little out. hearing

Andrew Jeffery

you. Thank

an Sorry low pretty about capitalized I'm asking time. about just which period after been have in quarters row, that. for agent better. this is Hopefully I've a noticed risen extended four of costs having

that about talk front? So you just wondering on agent economics can if environment competitive and the

Hikmet Ersek

the just unusual. and agents depends of renewals the given through, in the within on when again because nothing of so range some about a part contracts plan mean nothing years just to in year. mean year and unusual five are our that's for contracts CapEx, we're maturity, and the come Yes, be numbers, look been for of historical X% year. again can X% of years, to range range the we've of -- the if Andrew expect and but the this bonuses right, the nature. we case it's in you're our couple sometimes XX% range, end been capital revenues It's our that lumpy agents, signing of for there. X% we bigger that have at going our you bonuses, so expenditures last and to the renewing in smaller most lower were X% given year, in The actually agent we full to any It in be at but we I

Operator

time It question. one for you. we Thank looks like more have

Susquehanna. from question comes Please next ahead. Our [indiscernible] go

Unidentified Analyst

it is Good partners wanted two you. results XXXX, and great, are when showcased major just back the if could there Russia, like guys. the doing I Day other? obviously compare that that's the helpful. more would versus be here you ask one to Analyst was just pronounced at than but the yes they I Saudi digital the that both Thank we mean at

Hikmet Ersek

the Yes, we contribution both I obviously think so they partners revenue amazing the do in and We with really contributing over like incremental. incremental also said we from do they we partners, do right? to performance profits as other we and is of are by partners, they transactions the margins these that are which also, wise not they see It high two as it. way, largest are very our the exciting are only

that's two do don’t but Telecom that, we call don’t smaller, but have would plus, know, of have you are Saudi banks out. We like also other partners, I very about I smaller that big we institutions. Arabia XXX have or only why We XX have They about, Company. partners. But they excited am financial transactions. partners say amount almost them even

their Telecom and there the we know, with this the is learn it our will Saudi with Arabia the is it hopefully within Saudi into gives and close with really so expand deal only the quarter ecosystem Company ecosystem to them doing expend reinvestment to aligned Saudi than our, Arabia and deal this As is with opportunity being Arabian customer partner a also money, we sending and previous together. the them us saw in serving M&A, with and are this question with more you them strategy. we within It aligned

It long-term. excited growing fast a It a here. we that. good partner about have We partner is is and very are

Brendan Metrano

interest Western speaking in for the forward and your Great. today to future. I time in want everybody look and Union your to thank

Operator

Thank today's… you. concludes This

Hikmet Ersek

Thank best. All you important. and the healthy. That's stay

Operator

presentation. Thank you all for today's joining

may disconnect You your now lines.

The Western Union Company (WU) 5 May 212021 Q1 Earnings call transcript