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MoneyGram International Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: May 4, 2012 04:32PM
MoneyGram International Inc. (MGI) filed Quarterly Report for the period ended 2012-03-31. Moneygram Intl has a market cap of $993.6 million; its shares were traded at around $15.56 with a P/E ratio of 24.5 and P/S ratio of 0.8.
Highlight of Business Operations:Fee and Other Revenue For the three months ended March 31, 2012, fee and other revenue growth of $24.9 million, or nine percent, was primarily driven by money transfer transaction volume growth of 15 percent, partially offset by a lower euro exchange rate and lower foreign exchange revenue, changes in corridor mix and lower average face value per transaction. Bill payment products primarily saw revenue declines from lower average fees per transaction while money order and official check fee and other revenue decreased due to volume declines. See the Segment Performance section for more detailed discussion.
Investment revenue Investment revenue consists of interest and dividends generated through the investment of cash balances received primarily from the sale of official checks, money orders and other payment instruments. Investment revenue decreased $0.8 million, or 21 percent, in the three months ended March 31, 2012 due to lower yields earned on our investment portfolio and lower average investment balances from the run-off of certain official check financial institution customers terminated in prior periods.
Net investment revenue and margin As a result of the factors discussed above, net investment revenue decreased $0.8 million, or 20 percent, for the three months ended March 31, 2012, while the net investment margin decreased 0.06 percentage points.
For the three months ended March 31, 2012, EBITDA increased $3.6 million, or 7 percent, to $55.0 from $51.3 million. Adjusted EBITDA for the three months ended March 31, 2012 increased $8.1 million, or 13 percent, to $68.4 million from $60.3 million, primarily due to money transfer growth, partially offset by increases in compensation, marketing spend and lower investment revenue.
Global Funds Transfer revenue Total revenue in the Global Funds Transfer segment consists primarily of fees on money transfers and bill payment transactions. For the three months ended March 31, 2012, Global Funds Transfer total revenue increased $26.4 million, driven by money transfer volume growth, partially offset by a decline in bill payment revenue. Bill payment fee and other revenue for the three months ended March 31, 2012 decreased eight percent. Lower average fees per transaction reduced revenue by $1.6 million, while volume declines of five percent reduced revenue by $0.8 million. The decline in transaction volume was due to continued softness in our traditional consumer credit payment categories including auto, credit card and collections, as these industries continued to be negatively impacted by economic conditions.
Stocks Discussed: MGI,