Western Union said on Wednesday (Aug. 3) that it had posted earnings of $0.42 a share for the second quarter that ended in June, which bested The Street by two pennies, as money transfers remained strong and the firm continued to gain traction in its digital business.
For the period, the firm reported revenues that came in at $1.4 billion, just slightly above consensus and at 3 percent gains when measured by constant currency. Foreign exchange revenues were up mid-single digits, to 5 percent gains. The core consumer-to-consumer business was up 2 percent and comprised 80 percent of the total top line. Total transactions were up 3 percent. The guidance was a range for the full year of $1.60–$1.70 a share, and that brackets the consensus of $1.63. The firm’s CEO, Hikmet Ersek, stated that results were solid, despite some international volatility.
The global B2B business, via the Business Solutions unit, was up 6 percent year over year in constant currency, and now, the segment is 7 percent of sales.
Drilling down a bit into the standouts for the quarter, management stated that WesternUnion.com delivered revenue growth of 20 percent year over year, reflecting digital traction. Transactions were up even faster than that, at 25 percent.
Looking firm-wide, technology investments should continue, with a temporary impact on margins. Ersek noted on the call with analysts that “new customers, which we signed on with mobile, want to drop money on a retail money transfer,” indicating some traction between businesses new and old.