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Western Union President and Chief Executive Officer Christina Gold said, "Our second quarter results were in line with expectations and we are pleased that Western Union is on track to achieve our full-year revenue and earnings targets. Global consumer-to-consumer transactions continued to grow for the period, and despite a challenging operating environment, we delivered strong margins and cash flow. In addition, we continued to make significant strategic progress on our growth initiatives, building on first quarter momentum."
In a release dated July 21, the company stated:
Consolidated Results
- In the second quarter, revenue was $1.3 billion, down 7 percent from last year's second quarter or down 2 percent constant currency adjusted. Operating income was $342 million, up 2 percent or down 5 percent excluding the restructuring expenses taken in the second quarter of 2008. Second quarter operating income margin was 27 percent compared to 25 percent in last year's second quarter. Excluding restructuring expense, the second quarter 2008 operating margin was 27 percent.
- Earnings per share were $0.31, flat compared to last year's second quarter, or a 6 percent decrease excluding restructuring expense from last year. The tax rate for the second quarter was 26 percent and the company continues to expect a full-year 2009 tax rate of approximately 26 percent.
Capital Deployment & Liquidity
- Western Union's year-to-date cash flow from operations was $606 million and capital expenditures were $40 million. Through six months, Western Union repurchased approximately nine million shares for $100 million at an average price of $11.39 per share. The company maintains its target of $400 million in repurchases for 2009.
- Cash on hand at quarter-end was $1.8 billion. Total outstanding debt at quarter end was approximately $3.0 billion. The nearest-dated debt maturity is $1 billion due in November of 2011. The company has a commercial paper program that is fully backed by a $1.5 billion revolving credit facility that expires in 2012. At quarter end, there was no commercial paper outstanding and this facility was undrawn.
- In the third quarter of 2008, the company reclassified $298 million from cash to a receivable pending receipt from the Reserve International Liquidity Fund. In January 2009 Western Union received $194 million and in June 2009 received $41 million from the Fund resulting in total collections of $235 million and a remaining receivable of $63 million at quarter end. In the second quarter management established a reserve of $12 million against the remaining receivable which impacted "Total other expenses, net" by $12 million, or earnings per share by $0.01.
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