MGI MoneyGram International Inc

DALLAS, Feb. 25, 2022 /PRNewswire/ -- MoneyGram International, Inc. (NASDAQ: MGI) today reported financial results for its fourth quarter ended December 31, 2021.

Fourth Quarter Business Highlights

"Our strong fourth quarter results represent a great finish to a remarkable year. Results were driven by the continued execution of our digital-first strategy, a record-breaking holiday season for our digital business, and resilience of our retail partners in many markets," said Alex Holmes MoneyGram Chairman and CEO. "2021 was a record year for the company as we achieved a number of strategic milestones, including significantly improving our capital structure, launching new product capabilities and innovative partnerships, and growing the digital business to an impressive $300 million run-rate exiting 2021. Above all, we continued to play an important role in connecting the world's communities by serving over 47 million people this past year."

Money Transfer highlights for the quarter include the following:

Fourth Quarter Financial Results, Year-Over-Year

Full-Year Financial Results, Year-Over-Year

Holmes concluded, "Our disciplined focus on customer acquisition, cross-border payments innovation, and customer experience enhancements are reflected in the results and remain fundamental to our growth strategy in the exciting year ahead."

Balance Sheet and Liquidity

Recent Updates

As recently announced, MoneyGram entered into a definitive agreement under which funds affiliated with Madison Dearborn Partners will acquire all outstanding shares of MoneyGram for $11.00 per share in an all-cash transaction valued at approximately $1.8 billion.

The transaction is expected to close in the fourth quarter of 2022, subject to customary closing conditions, including approval by MoneyGram shareholders and receipt of regulatory approvals, including required approvals in various jurisdictions related to money transmitter licenses.

About MoneyGram International, Inc.
MoneyGram International, Inc. (NASDAQ: MGI), a global leader in the evolution of digital P2P payments, delivers innovative financial solutions to connect the world's communities. With a purpose-driven strategy to mobilize the movement of money, a strong culture of fintech innovation, and leading customer-centric capabilities, MoneyGram has grown to serve over 150 million people in the last five years. The Company leverages its modern, mobile, and API-driven platform and collaborates with the world's top brands to serve consumers through its direct-to-consumer digital channel, global retail network, and embedded finance business for enterprise customers. MoneyGram is also a leader in pioneering cross-border payment innovation and blockchain-enabled settlement. For more information, please visit ir.moneygram.com, follow @MoneyGram on social media, and explore the website and mobile app through moneygram.com.

Forward-Looking Statements
This communication contains forward-looking statements which are protected as forward-looking statements under the Private Securities Litigation Reform Act of 1995 that are not limited to historical facts, but reflect MoneyGram's current beliefs, expectations or intentions regarding future events and speak only as of the date they are made. Words such as "may," "might," "will," "could," "should," "would," "expect," "plan," "project," "intend," "anticipate," "believe," "estimate," "predict," "potential," "pursuant," "target," "forecast," "outlook," "continue," "currently," and similar expressions are intended to identify such forward-looking statements. The statements in this communication that are not historical statements are forward-looking statements within the meaning of the federal securities laws. Specific forward-looking statements include, among others, statements regarding the Company's projected results of operations and specific factors expected to impact the Company's results of operations. Forward-looking statements are subject to numerous risks and uncertainties that are difficult to predict and many of which are beyond MoneyGram's control, which could cause actual results to differ materially from the results expressed or implied by the statements.

These risks and uncertainties include, but are not limited to:

• the impact of the COVID-19 pandemic or future pandemics on our business, including the potential work stoppages, lockdowns, shelter-in-place, or restricted movement guidelines, service delays and lower consumer and commercial activity;
• our ability to compete effectively;
• our ability to maintain key agent or biller relationships, or a reduction in business or transaction volume from these relationships, including with our largest agent, Walmart, through its introduction of additional competing white label money transfer products or otherwise;
• our ability to continue to grow our Digital Channel, including through our direct-to-consumer digital business, MoneyGram Online;
• a security or privacy breach in systems, networks or databases on which we rely;
• current and proposed regulations addressing consumer privacy and data use and security;
• our ability to manage fraud risks from consumers or agents;
• the ability of us and our agents to comply with U.S. and international laws and regulations;
• litigation and regulatory proceedings involving us or our agents and other commercial relationships, which could result in material settlements, fines or penalties, revocation of required licenses or registrations, termination of contracts, other administrative actions or lawsuits and negative publicity;
• disruptions to our computer systems and data centers and our ability to effectively operate and adapt our technology;
• the ability of us and our agents to maintain adequate banking relationships;
• our ability to successfully develop and timely introduce new and enhanced products and services and our investments in new products, services or infrastructure changes;
• our high degree of leverage and substantial debt service obligations, significant debt covenant requirements and our ability to comply with such requirements;
• our below investment-grade credit rating;
• our ability to maintain sufficient capital;
• weakness in economic conditions, in both the U.S. and global markets;
• the financial health of certain European countries or the secession of a country from the European Union;
• a significant change, material slow down or complete disruption of international migration patterns;
• our ability to manage risks associated with our international sales and operations, including exchange rates among currencies;
• our offering of money transfer services through agents in regions that are politically volatile or, in a limited number of cases, that may be subject to certain OFAC restrictions;
• major bank failure or sustained financial market illiquidity, or illiquidity at our clearing, cash management and custodial financial institutions;
• changes in tax laws or unfavorable outcomes of tax positions we take, or a failure by us to establish adequate reserves for tax events;
• our ability to manage credit risks from our agents and official check financial institution customers;
• our ability to adequately protect our brand and intellectual property rights and to avoid infringing on the rights of others;
• our ability to manage risks related to the operation of retail locations and the acquisition or start-up of businesses;
• any restructuring actions and cost reduction initiatives that we undertake may not deliver the expected results and these actions may adversely affect our business;
• our capital structure;
• risks relating to the proposed Merger (as defined in the form 8-K filed on February 15, 2022), including the possibility that the consummation of the Merger could be delayed or not completed, and the effect of announcement or pendency of the Merger on our business; and
• the risks and uncertainties described in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of MoneyGram's public period reports filed with the U.S. Securities and Exchange Commission (the SEC), including MoneyGram's annual report on Form 10-K for the year ended December 31, 2020, and subsequent quarterly reports on Form 10-Q.

Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in MoneyGram's SEC filings. MoneyGram's SEC filings may be obtained by contacting MoneyGram, through MoneyGram's web site at ir.moneygram.com or through the SEC's Electronic Data Gathering and Analysis Retrieval System ("EDGAR") at www.sec.gov. MoneyGram undertakes no obligation to publicly update or revise any forward-looking statement.

Non-GAAP Measures

In addition to results presented in accordance with accounting principles generally accepted in the United States (GAAP), this news release and related tables include certain non-GAAP financial measures, including a presentation of EBITDA (earnings before interest, taxes, depreciation and amortization, including agent signing bonus amortization), Adjusted EBITDA (EBITDA adjusted for certain significant items), Adjusted EBITDA margin, Adjusted Free Cash Flow (Adjusted EBITDA less cash interest, cash taxes and cash payments for capital expenditures and agent signing bonuses), constant currency measures (which assume that amounts denominated in foreign currencies are translated to the U.S. dollar at rates consistent with those in the prior year), diluted adjusted income (loss) per share and adjusted net income. In addition, we present gross profit for our two reporting segments. The following tables include a full reconciliation of non-GAAP financial measures to the related GAAP financial measures. The equivalent GAAP financial measures for projected results are not provided, and projected results do not reflect the potential impact of certain non-GAAP adjustments, which include (but in future periods, may not be limited to) stock-based, contingent and incentive compensation costs; compliance enhancement program costs; direct monitor costs; legal and contingent matter costs; restructuring and reorganization costs; currency changes; and the tax effect of such items. We cannot reliably predict or estimate if and when these types of costs, adjustments or changes may occur or their impact to our financial statements. Accordingly, a reconciliation of the non-GAAP financial measures to the equivalent GAAP financial measures for projected results is not available.

We believe that these non-GAAP financial measures provide useful information to investors because they are an indicator of the strength and performance of ongoing business operations. These calculations are commonly used as a basis for investors, analysts and other interested parties to evaluate and compare the operating performance and value of companies within our industry. Finally, EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Free Cash Flow, constant currency, diluted adjusted income (loss) per share and adjusted net income (loss) figures are financial and performance measures used by management in reviewing results of operations, forecasting, allocating resources or establishing employee incentive programs. Although MoneyGram believes the above non-GAAP financial measures enhance investors' understanding of its business and performance, these non-GAAP financial measures should not be considered in isolation or as substitutes for the accompanying GAAP financial measures.

Description of Tables

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SOURCE MoneyGram