MoneyGram International Inc. (MGI) reported better-than-expected earnings for the third quarter of 2018 while revenue missed estimates. Though the earnings beat initially sent the stock up over 5% during the pre-market session on Friday, shares tumbled 3.8% within an hour.
Total revenues fell 13% to $347.2 million from the same period last year, missing the consensus estimate of $378 million. On a constant currency basis, revenues dropped 12%.
During the quarter, the company reported a net loss of $20.9 million or $0.32 per share compared to a net income of $7.7 million or $0.12 per share in the prior-year period. Adjusted EPS totaled $0.24, coming in ahead of the projections for $0.15.
Money transfer revenue dropped 15%, impacted by higher compliance standards and new corridor-specific controls. MoneyGram.com revenue grew 3% while higher yields and investment balances helped fuel a year-over-year growth of $5.8 million in investment revenue, which totaled $13.5 million.
During the quarter, the company expanded its online service to several more countries and introduced the new MoneyGram app in Europe. Over the coming weeks, MoneyGram.com is expected to be live in 25 countries and the app available in 16, including the US.
In the third quarter, MoneyGram incurred $1.2 million of expenses from its restructuring and reorganization program which is part of its Digital Transformation initiative. The company has incurred $14 million in expenses for the year.
MoneyGram expects to spend another $2.5 million to $5.5 million over the life of the program, and to gain efficiencies that will result in $30 million of cost savings in 2018, and upon completion, $45 million on an annualized basis.
MoneyGram revised its guidance for the full year of 2018 and now expects revenues to decline approx. 10%, on a constant currency basis. Adjusted EBITDA is expected to decline approx. 15% on a constant currency basis. The previous outlook projected declines of 4-6% in revenues and 8-10% in adjusted EBITDA, on a constant currency basis.
MoneyGram also entered into agreements with the US Department of Justice (DOJ) and the Federal Trade Commission (FTC) on matters related to its anti-fraud and anti-money laundering program.
The company agreed to amend and extend its deferred prosecution agreement (DPA) with the DOJ for 30 months and to modify its consent order with the FTC. MoneyGram also agreed to forfeit $125 million which will be made available to consumer fraud victims.
Get access to timely and accurate verbatim transcripts that are published within hours of the event.
Yelp (NYSE: YELP) reported second-quarter financial results after the regular trading hours on Thursday. The results were better than what the street had anticipated. YELP shares rose 4% immediately following the
Uber Technologies (NYSE: UBER) reported its second-quarter 2020 financial results after the regular trading hours on Thursday. Revenues exceeded the estimates, while the bottom-line missed. Shares of the ride-hailing company
TMobile US Inc. (NASDAQ: TMUS) on Thursday announced financial results for the second quarter of 2020, reporting a 61% increase in revenues aided by strong customer growth. The results also