Euronet Worldwide Reports Third Quarter 2021 Financial Results
- Revenues of
$816 .6 million, a 23% increase from$664.4 million (22% increase on a constant currency1 basis). - Operating income of $114.5 million, a 73% increase from $66.1 million (72% increase on a constant currency basis).
- Adjusted operating income2 of
$114.5 million , a 69% increase from$67.6 million (68% increase on a constant currency basis). - Adjusted EBITDA3 of
$155 .2 million, a 48% increase from $105.0 million (47% increase on a constant currency basis). - Net income attributable to
Euronet of $73.9 million, or $1.37 diluted earnings per share, compared with net income of$40 .2 million, or $0.76 diluted earnings per share. - Adjusted earnings per share4 of
$1.77 , a 58% increase from$1.12 Euronet's cash and cash equivalents were$1,048.5 million and ATM cash was$669 .7 million, totaling$1,718 million as of September 30, 2021, and availability under its revolving credit facilities was approximately $920 million.
See the reconciliation of non-GAAP items in the attached financial schedules.
"I am extremely pleased that we were able to deliver a very good third quarter where revenue exceeded our third quarter 2019 revenue and where earnings nicely exceeded our expectations as we benefitted from a strong improvement in global travel as borders reopened," stated
The stronger than expected third quarter results were largely driven by an immediate improvement in EFT transactions from travelers who were quick to resume their travel plans as European borders were generally opened to fully vaccinated passengers within
Adjusted operating income in the third quarter 2020 included a
Taking into consideration current trends in the business, the latest global COVID-19 landscape and historical seasonal patterns, the Company anticipates that its fourth quarter 2021 revenues will be generally in-line with the third quarter, recognizing seasonal shifting in the mix of revenue between the EFT and epay segments. Adjusted EBITDA is expected to be in the range of approximately
Segment and Other Results
The EFT Processing Segment reports the following results for the third quarter 2021 compared with the same period or date in 2020:
- Revenues of $227.1 million, a 58% increase from
$144.1 million (56% increase on a constant currency basis). - Operating income of
$63 .2 million, a 919% increase from $6.2 million (908% improvement on a constant currency basis). - Adjusted EBITDA of
$85 .8 million, a 210% improvement from $27.7 million (207% improvement on a constant currency basis). - Transactions of 1,173 million, a 29% increase from 910 million.
- Total of 47,474 installed ATMs as of
September 30, 2021 , a 2% decrease from 48,208. Operated 45,520 active ATMs as of September 30, 2021, a 4% increase from 43,956.
Revenue, operating income, and adjusted EBITDA growth in the third quarter 2021 were driven by increased domestic and international withdrawal transactions resulting from the partial lifting of travel restrictions across
The EFT Segment's total installed ATMs were lower than the prior year due to the fourth quarter 2020 removal of nearly 1,750 low-margin outsourced ATMs in
The epay Segment reports the following results for the third quarter 2021 compared with the same period or date in 2020:
- Revenues of $238.3 million, a 20% increase from
$198 .9 million (19% increase on a constant currency basis). - Operating income of
$25 .9 million, a 17% increase from$22 .2 million (17% increase on a constant currency basis). - Adjusted EBITDA of
$28 .2 million, a 16% increase from$24.3 million (16% increase on a constant currency basis). - Transactions of 811 million, a 23% increase from 661 million.
- Point-of-sale ("POS") terminals of approximately 739,000 as of September 30, 2021, a 3% increase from approximately 717,000.
- Retailer locations of approximately 325,000 as of September 30, 2021, a 1% decrease from approximately 328,000.
The generally consistent third quarter revenue, operating income and adjusted EBITDA and transaction growth was driven by continued digital media and mobile growth, together with the continued expansion of the digital distribution channel.
The Money Transfer Segment reports the following results for the third quarter 2021 compared with the same period or date in 2020:
- Revenues of
$353 .5 million, a 9% increase from$323.1 million (8% increase on a constant currency basis). - Operating income of
$37 .6 million, a 21% decrease from$47.6 million (21% decrease on a constant currency basis). - Adjusted operating income of
$37.6 million , a 23% decrease from$49.1 million (23% decrease on a constant currency basis). - Adjusted EBITDA of
$46 .5 million, a 20% decrease from$57.8 million (20% decrease on a constant currency basis). - Total transactions of 34.1 million, a 10% increase from 30.9 million.
- Network locations of approximately 507,000 as of September 30, 2021, a 13% increase from approximately 447,000.
Third quarter revenue growth was the result of strong 18% growth in
Corporate and Other reports $12.2 million of expense for the third quarter 2021 compared with $9.9 million for the third quarter 2020. The increase in corporate expense for the third quarter is largely due to higher short- and long-term compensation expense.
Balance Sheet and Financial Position
Unrestricted cash and cash equivalents on hand was $1,048.5 million as of September 30, 2021, compared to
Total indebtedness was
Non-GAAP Measures
In addition to the results presented in accordance with
The Company does not provide a reconciliation of its forward-looking non-GAAP measures to GAAP due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for GAAP and the related GAAP and non-GAAP reconciliation, including adjustments that would be necessary for foreign currency exchange rate fluctuations and other charges reflected in the Company's reconciliation of historic numbers, the amount of which, based on historical experience, could be significant.
(1) Constant currency financial measures are computed as if foreign currency exchange rates did not change from the prior period. This information is provided to illustrate the impact of changes in foreign currency exchange rates on the Company's results when compared to the prior period.
(2) Adjusted operating income is defined as operating income excluding intangible asset impairment charges. Adjusted operating income represents a performance measure and is not intended to represent a liquidity measure.
(3) Adjusted EBITDA is defined as net income excluding, to the extent incurred in the period, interest, income tax expense, depreciation, amortization, share-based compensation, intangible asset impairment charges and other non-operating or non-recurring items that are considered expenses or income under
(4) Adjusted earnings per share is defined as diluted
Conference Call and Slide Presentation
A webcast replay will be available beginning approximately one hour after the event at http://ir.euronetworldwide.com and will remain available for one year.
About
Statements contained in this news release that concern
EURONET WORLDWIDE, INC. | |||||
Condensed Consolidated Balance Sheets | |||||
(in millions) | |||||
As of | |||||
As of | |||||
2021 | December 31, | ||||
(unaudited) | 2020 | ||||
ASSETS | |||||
Current assets: | |||||
Cash and cash equivalents | $ | 1,048.5 | $ | 1,420.3 | |
ATM cash | 669.7 | 411.1 | |||
Restricted cash | 3.6 | 3.3 | |||
Settlement assets | 928.7 | 1,140.9 | |||
Trade accounts receivable, net | 152.6 | 117.5 | |||
Prepaid expenses and other current assets | 235.2 | 272.8 | |||
Total current assets | 3,038.3 | 3,365.9 | |||
Property and equipment, net | 350.7 | 378.4 | |||
Right of use lease asset, net | 165.3 | 162.1 | |||
748.4 | 787.7 | ||||
Other assets, net | 223.6 | 232.6 | |||
Total assets | $ | 4,526.3 | $ | 4,926.7 | |
LIABILITIES AND EQUITY | |||||
Current liabilities: | |||||
Settlement obligations | $ | 928.7 | $ | 1,140.9 | |
Accounts payable and other current liabilities | 654.1 | 654.9 | |||
Current portion of operating lease liabilities | 54.2 | 52.4 | |||
Short-term debt obligations | 5.8 | 7.2 | |||
Total current liabilities | 1,642.8 | 1,855.4 | |||
Debt obligations, net of current portion | 1,197.5 | 1,437.6 | |||
Operating lease liabilities, net of current portion | 115.3 | 106.5 | |||
Capital lease obligations, net of current portion | 3.2 | 6.2 | |||
Deferred income taxes | 38.7 | 37.9 | |||
Other long-term liabilities | 37.3 | 37.2 | |||
Total liabilities | 3,034.8 | 3,480.8 | |||
Equity | 1,491.5 | 1,445.9 | |||
Total liabilities and equity | $ | 4,526.3 | $ | 4,926.7 | |
Consolidated Statements of Operations | ||||||||
(unaudited - in millions, except share and per share data) | ||||||||
Three Months Ended | ||||||||
2021 | 2020 | |||||||
Revenues | $ | 816.6 | $ | 664.4 | ||||
Operating expenses: | ||||||||
Direct operating costs | 484.4 | 407.6 | ||||||
Salaries and benefits | 119.4 | 101.5 | ||||||
Selling, general and administrative | 64.4 | 55.3 | ||||||
Impairment of intangible assets | — | 1.5 | ||||||
Depreciation and amortization | 33.9 | 32.4 | ||||||
Total operating expenses | 702.1 | 598.3 | ||||||
Operating income | 114.5 | 66.1 | ||||||
Other income (expense): | ||||||||
Interest income | 0.2 | 0.1 | ||||||
Interest expense | (10.2 | ) | (9.4 | ) | ||||
Foreign currency exchange loss | (8.1 | ) | (1.4 | ) | ||||
Total other expense, net | (18.1 | ) | (10.7 | ) | ||||
Income before income taxes | 96.4 | 55.4 | ||||||
Income tax expense | (22.7 | ) | (15.1 | ) | ||||
Net income | 73.7 | 40.3 | ||||||
Net income (loss) attributable to noncontrolling interests | 0.2 | (0.1 | ) | |||||
Net income attributable to |
$ | 73.9 | $ | 40.2 | ||||
Earnings per share attributable to |
||||||||
$ | 1.37 | $ | 0.76 | |||||
Diluted weighted average shares outstanding | 53,853,675 | 53,201,971 | ||||||
EURONET WORLDWIDE, INC. | ||||||||||||||||||||
Reconciliation of Net Income to Operating Income (Expense) to Adjusted Operating Income (Expense) and Adjusted EBITDA | ||||||||||||||||||||
(unaudited - in millions) | ||||||||||||||||||||
Three months ended |
||||||||||||||||||||
EFT Processing |
epay | Money Transfer |
Corporate Services |
Consolidated | ||||||||||||||||
Net income | $ | 73.7 | ||||||||||||||||||
Add: Income tax expense | 22.7 | |||||||||||||||||||
Add: Total other expense, net | 18.1 | |||||||||||||||||||
Operating income (expense) | $ | 63.2 | $ | 25.9 | $ | 37.6 | $ | (12.2 | ) | $ | 114.5 | |||||||||
Add: Depreciation and amortization | 22.6 | 2.3 | 8.9 | 0.1 | 33.9 | |||||||||||||||
Add: Share-based compensation | — | — | — | 6.8 | 6.8 | |||||||||||||||
Earnings before interest, taxes, depreciation, amortization, and share-based compensation (Adjusted EBITDA) (1) | $ | 85.8 | $ | 28.2 | $ | 46.5 | $ | (5.3 | ) | $ | 155.2 | |||||||||
Three months ended |
||||||||||||||||||||
EFT Processing |
epay | Money Transfer |
Corporate Services |
Consolidated | ||||||||||||||||
Net Income | $ | 40.3 | ||||||||||||||||||
Add: Income tax expense | 15.1 | |||||||||||||||||||
Add: Total other expense, net | 10.7 | |||||||||||||||||||
Operating income (expense) | $ | 6.2 | $ | 22.2 | $ | 47.6 | $ | (9.9 | ) | $ | 66.1 | |||||||||
Add: Intangible asset impairment charges | — | — | 1.5 | — | 1.5 | |||||||||||||||
Adjusted operating income (expense)(1) | 6.2 | 22.2 | 49.1 | (9.9 | ) | 67.6 | ||||||||||||||
Add: Depreciation and amortization | 21.5 | 2.1 | 8.7 | 0.1 | 32.4 | |||||||||||||||
Add: Share-based compensation | — | — | — | 5.0 | 5.0 | |||||||||||||||
Earnings before interest, taxes, depreciation, amortization, share-based compensation and intangible asset impairment charges (Adjusted EBITDA) (1) | $ | 27.7 | $ | 24.3 | $ | 57.8 | $ | (4.8 | ) | $ | 105.0 |
(1) Adjusted operating income and adjusted EBITDA are non-GAAP measures that should be considered in addition to, and not a substitute for, net income computed in accordance with
EURONET WORLDWIDE, INC. | ||||||||
Reconciliation of Adjusted Earnings per Share | ||||||||
(unaudited - in millions, except share and per share data) | ||||||||
Three Months Ended | ||||||||
2021 | 2020 | |||||||
Net income attributable to |
$ | 73.9 | $ | 40.2 | ||||
Foreign currency exchange loss | 8.1 | 1.4 | ||||||
Intangible asset amortization(1) | 5.8 | 5.8 | ||||||
Share-based compensation(2) | 6.8 | 5.0 | ||||||
Impairment of intangible assets | — | 1.5 | ||||||
Non-cash interest accretion(3) | 4.0 | 3.8 | ||||||
Income tax effect of above adjustments(4) | (3.7 | ) | (6.4 | ) | ||||
Non-cash GAAP tax expense(5) | 1.1 | 8.5 | ||||||
Adjusted earnings(6) | $ | 96.0 | $ | 59.8 | ||||
Adjusted earnings per share - diluted(6) | $ | 1.77 | $ | 1.12 | ||||
Diluted weighted average shares outstanding (GAAP) | 53,853,675 | 53,201,971 | ||||||
Effect of unrecognized share-based compensation on diluted shares outstanding | 392,211 | 152,672 | ||||||
Adjusted diluted weighted average shares outstanding | 54,245,886 | 53,354,643 | ||||||
(1) Intangible asset amortization of $5.8 million and $5.8 million are included in depreciation and amortization expense of $33.9 million and $32.4 million for the three months ended
(2) Share-based compensation of $6.8 million and $5.0 million are included in salaries and benefits expense of $119.4 million and $101.5 million for the three months ended
(3) Non-cash interest accretion of
(4) Adjustment is the aggregate
(5) Adjustment is the non-cash GAAP tax impact recognized on certain items such as the utilization of certain material net deferred tax assets and amortization of indefinite-lived intangible assets.
(6) Adjusted earnings and adjusted earnings per share are non-GAAP measures that should be considered in addition to, and not as a substitute for, net income and earnings per share computed in accordance with
Contact:
+1-913-327-4200
Source: Euronet Worldwide, Inc.