Western Union(US:WU)2026-02-20 21:07Financial Performance - Revenues for the year ended December 31, 2025, were $4,050.7 million, a decrease of 4% compared to $4,209.7 million in 2024[217] - Operating income increased by 4% to $757.3 million in 2025 from $725.8 million in 2024[217] - Net income for 2025 was $499.6 million, down 47% from $934.2 million in 2024[217] - Basic earnings per share decreased to $1.53 in 2025, a decline of 44% from $2.75 in 2024[228] - Total expenses for 2025 were $3,293.4 million, down 5% from $3,483.9 million in 2024[217] Segment Performance - Consumer Money Transfer segment revenues decreased by 8% to $3,507.4 million in 2025 from $3,798.0 million in 2024[234] - The Consumer Money Transfer segment accounted for 87% of total revenues in 2025, down from 90% in 2024[232] - Consumer Services segment revenues increased by 32% to $543.3 million in 2025, up from $411.7 million in 2024[244] - Operating income for Consumer Money Transfer decreased due to reduced revenue, partially offset by lower agent commissions and technology expenses[243] Cash Flow and Liquidity - Cash provided by operating activities increased to $543.7 million in 2025 from $406.3 million in 2024, primarily due to an income tax settlement[258] - As of December 31, 2025, cash and cash equivalents were $1,234.4 million, down from $1,474.0 million in 2024[254] - The company has $392.0 million in outstanding commercial paper borrowings as of December 31, 2025, with a weighted-average interest rate of approximately 3.9%[262] Debt and Financing - The Revolving Credit Facility was increased to $1.62 billion, maturing on November 30, 2029[263] - The company had $800.0 million outstanding under the Term Loan Facility, maturing on December 13, 2027[266] - The Delayed Draw Term Loan Facility was established with an aggregate amount of $800.0 million, with the option to increase to $1.0 billion[267] - The consolidated interest coverage ratio was 7:1 for the year ended December 31, 2025[271] - Projected interest payments on outstanding borrowings were $698.6 million as of December 31, 2025[280] Capital Expenditures and Shareholder Returns - Capital expenditures totaled $150.8 million in 2025, up from $130.6 million in 2024[276] - Share repurchases amounted to 23.7 million shares for $224.7 million in 2025, with an average cost of $9.49 per share[277] - Quarterly cash dividends of $0.235 per common share were declared in all four quarters of 2025, totaling $304.7 million[278] Assets and Goodwill - As of December 31, 2025, the carrying value of goodwill was $2,098.5 million, representing approximately 25% of consolidated assets[298] - Goodwill in the Consumer Money Transfer reporting unit was $1,986.4 million, with no impairments recorded for the years ended December 31, 2025 and 2024[298] - The net carrying value of other intangible assets as of December 31, 2025 was $356.3 million, with immaterial impairments recorded during the years ended December 31, 2025 and 2024[303] - The company has approximately $2.4 billion in interest-bearing assets, with $1.0 billion bearing floating interest rates[309] Risk Management - A hypothetical 100 basis point increase in interest rates would decrease annual pre-tax income by approximately $12 million based on sensitive borrowings[313] - The company manages foreign exchange risk through short-duration foreign currency forward contracts, with maturities ranging from a few days to one month[306] - A hypothetical 10% strengthening or weakening of the U.S. dollar would result in a pre-tax annual income change of approximately $40 million[308] - Credit and non-credit losses have been less than 2% of consolidated revenues in all periods presented[317] - The company evaluates the recoverability of goodwill and other intangible assets based on qualitative and quantitative assessments, including discounted cash flows[295] Regulatory and Compliance Risks - The company faces risks related to mergers, acquisitions, and the integration of acquired businesses, which may not yield anticipated financial benefits[323] - There are potential liabilities from litigation, including class-action lawsuits and regulatory enforcement actions, which could incur significant costs[326] - The company must comply with evolving regulations regarding consumer privacy and data security, which may impact operational costs and business practices[326] - Changes in tax laws and their interpretations could adversely affect the company's financial position and operations[323] - The company is exposed to foreign exchange rate fluctuations, which may impact financial results and require effective management[323] - There are risks associated with the ability to attract and retain qualified key employees, which is crucial for operational success[323] - The company must navigate increased regulatory costs and changes in laws affecting digital currencies and related technologies[323] - The company may face adverse rating actions from credit rating agencies, impacting its financial stability and borrowing costs[323] - The company is at risk of material changes in the market value or liquidity of securities it holds, which could affect its financial health[323] - The company must manage credit and fraud risks presented by agents and clients, which is essential for maintaining operational integrity[323]