International Money Express(IMXI) - 2024 Q2 - Quarterly Results

Financial Performance Highlights In the second quarter of 2024, Intermex achieved a 1.4% increase in revenue to $171.5 million. However, net income declined by 9.1% to $14.0 million, primarily due to $2.7 million in restructuring charges. Despite this, Adjusted Diluted EPS grew by 10.0% to $0.55, benefiting from share repurchases. Year-to-date results followed a similar trend with revenue up 2.4% and Adjusted Diluted EPS up 10.2% Financial Metric (Q2) | Financial Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | Revenues | $171.5 million | $169.2 million | +1.4% | | Net Income | $14.0 million | $15.4 million | -9.1% | | Diluted EPS | $0.42 | $0.42 | 0.0% | | Adjusted Diluted EPS | $0.55 | $0.50 | +10.0% | | Adjusted EBITDA | $31.1 million | $30.9 million | +0.6% | Financial Metric (YTD) | Financial Metric | YTD 2024 | YTD 2023 | Change | | :--- | :--- | :--- | :--- | | Revenues | $321.9 million | $314.5 million | +2.4% | | Net Income | $26.1 million | $27.2 million | -4.0% | | Diluted EPS | $0.78 | $0.73 | +6.8% | | Adjusted Diluted EPS | $0.97 | $0.88 | +10.2% | | Adjusted EBITDA | $56.5 million | $55.0 million | +2.7% | - The decrease in Q2 net income was primarily impacted by $2.7 million in restructuring charges incurred during the quarter[3] - Diluted EPS for Q2 remained flat year-over-year as the benefit from a reduced share count due to stock repurchases was offset by lower net income[3] Operational and Strategic Developments The company demonstrated operational growth with a 3.9% increase in unique active customers, reaching 4.2 million in Q2 2024. Strategically, Intermex continued its share repurchase program, buying back $11.2 million in stock during the quarter. Additionally, the company initiated a restructuring of its foreign operations, incurring $2.7 million in costs, which is expected to yield over $2.0 million in annualized savings starting in 2025 - The CEO emphasized the successful execution of a differentiated, omnichannel strategy combined with a focus on efficiency, which is believed to be outpacing the market in both growth and profitability[2] Operational Metric | Operational Metric | Q2 2024 | Change (YoY) | | :--- | :--- | :--- | | Unique, Active Customers | 4.2 million | +3.9% | | Money Transfer Transactions | 15.3 million | +1.3% | | Principal Amount Transferred | $6.4 billion | N/A | - The company repurchased 521,651 shares for $11.2 million in Q2 2024, bringing the total for the first half of the year to 1.64 million shares for $34.6 million[6] - Restructuring costs of $2.7 million were incurred in Q2 related to foreign operations, with expected recurring annualized savings of over $2.0 million beginning in 2025[7] Financial Outlook (Guidance) Intermex has revised its full-year 2024 guidance and issued new guidance for the third quarter. For the full year, the company expects revenues between $657.6 million and $677.6 million and Adjusted Diluted EPS between $2.07 and $2.25. For Q3 2024, revenues are projected to be between $170.6 million and $175.8 million, with Adjusted Diluted EPS in the range of $0.57 to $0.62 Full-Year 2024 Guidance | Full-Year 2024 Guidance | Range | | :--- | :--- | | Revenue | $657.6 million - $677.6 million | | Diluted EPS | $1.73 - $1.87 | | Adjusted Diluted EPS | $2.07 - $2.25 | | Adjusted EBITDA | $121.1 million - $124.7 million | Third Quarter 2024 Guidance | Third Quarter 2024 Guidance | Range | | :--- | :--- | | Revenue | $170.6 million - $175.8 million | | Diluted EPS | $0.49 - $0.54 | | Adjusted Diluted EPS | $0.57 - $0.62 | | Adjusted EBITDA | $32.1 million - $33.1 million | Financial Statements This section presents the company's financial position and performance through its consolidated income statements and balance sheets Condensed Consolidated Statements of Income The income statement for Q2 2024 shows total revenues increased by 1.4% to $171.5 million year-over-year. However, operating income decreased from $24.7 million to $22.9 million, and net income fell from $15.4 million to $14.0 million, impacted by $2.7 million in restructuring costs not present in the prior year Income Statement (Q2) | Income Statement (Q2) | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenues | $171.5 million | $169.2 million | | Total Operating Expenses | $148.6 million | $144.4 million | | Operating Income | $22.9 million | $24.7 million | | Net Income | $14.0 million | $15.4 million | Income Statement (YTD) | Income Statement (YTD) | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenues | $321.9 million | $314.5 million | | Total Operating Expenses | $279.5 million | $270.9 million | | Operating Income | $42.5 million | $43.6 million | | Net Income | $26.1 million | $27.2 million | Condensed Consolidated Balance Sheets As of June 30, 2024, Intermex held $233.2 million in cash and cash equivalents. Total assets grew to $612.4 million from $576.8 million at the end of 2023. Total liabilities also increased to $470.0 million, while stockholders' equity decreased to $142.4 million Balance Sheet | Balance Sheet | June 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $233.2 million | $239.2 million | | Total current assets | $462.7 million | $432.9 million | | Total assets | $612.4 million | $576.8 million | | Total current liabilities | $246.4 million | $223.4 million | | Total liabilities | $470.0 million | $427.8 million | | Total stockholders' equity | $142.4 million | $149.0 million | Non-GAAP Financial Measures and Reconciliations The company uses non-GAAP measures like Adjusted Net Income, Adjusted EBITDA, and Net Free Cash Generated to evaluate performance. These measures exclude items such as share-based compensation, restructuring costs, and amortization of intangibles to provide a clearer view of core business operations. Detailed reconciliations are provided to bridge these non-GAAP figures to their closest GAAP equivalents - Management uses non-GAAP measures like Adjusted Net Income, Adjusted EPS, and Adjusted EBITDA as primary metrics to evaluate financial performance, believing they help highlight operating trends by excluding certain non-core or non-cash items[9][10] Reconciliation of Net Income to Adjusted Net Income & EPS For Q2 2024, GAAP Net Income of $14.0 million was reconciled to Adjusted Net Income of $18.1 million. The primary adjustments were adding back $2.7 million in restructuring costs and $2.4 million in share-based compensation. This led to an Adjusted Diluted EPS of $0.55, compared to the GAAP Diluted EPS of $0.42 Reconciliation to Adjusted Net Income (Q2 2024) | Reconciliation to Adjusted Net Income (Q2 2024) | Amount (in thousands) | | :--- | :--- | | Net Income (GAAP) | $14,033 | | Share-based compensation | $2,392 | | Restructuring costs | $2,711 | | Amortization of intangibles | $958 | | Other adjustments (net) | ($1,487) | | Adjusted Net Income (Non-GAAP) | $18,095 | Earnings Per Share (Q2 2024) | Earnings Per Share (Q2 2024) | Amount | | :--- | :--- | | GAAP Diluted EPS | $0.42 | | Non-GAAP Adjusted Diluted EPS | $0.55 | Reconciliation of Net Income to Adjusted EBITDA In Q2 2024, GAAP Net Income of $14.0 million was adjusted to arrive at an Adjusted EBITDA of $31.1 million. Significant add-backs included the income tax provision ($5.8 million), depreciation and amortization ($3.4 million), interest expense ($3.1 million), restructuring costs ($2.7 million), and share-based compensation ($2.4 million). The resulting Adjusted EBITDA Margin was 18.1% Reconciliation to Adjusted EBITDA (Q2 2024) | Reconciliation to Adjusted EBITDA (Q2 2024) | Amount (in thousands) | | :--- | :--- | | Net Income (GAAP) | $14,033 | | Interest expense | $3,095 | | Income tax provision | $5,776 | | Depreciation and amortization | $3,371 | | Restructuring costs | $2,711 | | Share-based compensation | $2,392 | | Other adjustments (net) | ($324) | | Adjusted EBITDA (Non-GAAP) | $31,052 | - The Adjusted EBITDA Margin for Q2 2024 was 18.1%, a slight decrease from 18.3% in the same period of 2023[24] Reconciliation of Net Income to Net Free Cash Generated The company generated $13.3 million in Net Free Cash in Q2 2024, a slight increase from $13.0 million in Q2 2023. For the first six months of 2024, Net Free Cash Generated was $17.2 million, a significant decrease from $26.9 million in the prior year, primarily due to higher cash used in investing activities Net Free Cash Generated (in thousands) | Net Free Cash Generated (in thousands) | Q2 2024 | Q2 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $14,033 | $15,422 | $26,139 | $27,184 | | Key Adjustments | $8,898 | $7,629 | $11,234 | $9,889 | | Cash used in investing | ($6,670) | ($7,909) | ($20,150) | ($10,028) | | Term loan pay downs | ($1,641) | ($1,094) | ($3,281) | ($2,188) | | Net Free Cash Generated | $13,261 | $12,954 | $17,223 | $26,889 | About the Company and Forward-Looking Statements This section provides a corporate overview of International Money Express, Inc., detailing its history since 1994 and its current operations as a money transfer service from North America and Europe to over 60 countries. It also includes the standard Safe Harbor statement, cautioning investors that forward-looking statements in the release are subject to numerous risks and uncertainties - Founded in 1994, Intermex facilitates money transfers from the U.S., Canada, and Europe to over 60 countries via a network of agent retailers, company stores, a mobile app, and websites[16] - The press release contains forward-looking statements regarding future performance, which are subject to various risks and uncertainties detailed in SEC filings. The company does not commit to updating these statements[14][15]