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Euronet sustains growth in 2015 despite depressed exchange rates

The US-based company, which operates principally in Europe, fought currency headwinds that turned double-digit increases into single-digit ones for the year.

February 11, 2016

E-payments provider and independent ATM deployer Euronet Worldwide Inc. announced its Q4 and full-year 2015 results this week.

The company reported results for the fourth quarter 2015 compared with the same period of 2014:

• revenues of $470.6 million, a 2 percent increase from $462.0 million (11 percent constant currency);
• operating income of $55.2 million, a 12 percent increase from $49.5 million (23 percent constant currency);
• adjusted EBITDA(2) of $76.9 million, an 8 percent increase from $71.4 million (19 percent constant currency);
• net income attributable to Euronet of $33.5 million or 61 cents diluted earnings per share, compared with net income of $30.1 million or 55 cents diluted earnings per share;
• adjusted cash earnings per share of 92 cents, a 24 percent increase from 74 cents; and
• transaction volume of 699 million, a 3 percent increase from 677 million.

Euronet also reported year-over-year results for 2014-2015:

• revenues of $1.77 billion, a 7 percent increase from $1.66 billion (19 percent constant currency);
• operating income of $204.9 million, a 29 percent increase from $158.7 million (50 percent constant currency);
• adjusted EBITDA of $287.7 million, an 18 percent increase from $242.9 million (36 percent constant currency);
• net income attributable to Euronet of $98.8 million or $1.83 diluted earnings per share, compared with net income of $101.6 million or $1.89 diluted earnings per share;
• adjusted cash earnings per share of $3.32, a 28 percent increase from $2.59; and
• transaction volume of 2.72 billion, a 7 percent increase from 2.55 billion.

Euronet Chairman and CEO Michael J. Brown said that the company's "exceptional year" was made possible by continued contributions from all three of its business segments — money transfer, e-pay and EFT (ATMs).

Full-year EFT results:

• Euronet operated 21,360 ATMs as of Dec. 31, a year-over-year increase of 5 percent from 20,364;
• Revenues of $379.6 million, a 6 percent increase from $358.7 million (22 percent constant currency);
• Operating income of $94.4 million, a 3 percent increase from $91.4 million (21 percent constant currency);
• Adjusted EBITDA of $126.0 million, a 3 percent increase from $122.8 million (20 percent constant currency); and
• Transaction volume of 1.32 billion, a 4 percent increase from 1.26 billion.

The company cited three negative events that affected its EFT segment results:

• in Q4, the company recorded a $1.3 million reserve for cash-in-transit to ATMs held in an account at a bank that declared bankruptcy;
• a company-initiated contract amendment and extension in Q1 2015 with one of its largest European customers resulted in lower constant currency operating income of approximately $5.5 million for the full year; and
• the termination of approximately 1,300 loss-generating ATMs in China. 

Euronet's money transfer segment recorded full-year revenues of $685.6 million, a 31 percent increase from $523.1 million (40 percent constant currency).

The company's e-pay segment recorded full year revenues of $708.3 million, a 10 percent decrease from $783.8 million (5 percent increase in constant currency).