Intermex Reports Fourth Quarter and Full Year Results
International Money Express, Inc. (IMXI) reports strong financial performance for Q4 and full-year 2023, with revenue growth, increased EPS, and adjusted EBITDA. The company's omnichannel strategy drives success, with positive net cash generation and stock repurchases.
Positive
Strong financial results for Q4 and full-year 2023 with revenue growth and increased EPS.
Positive impact of omnichannel strategy on company performance.
Increased adjusted EBITDA and net cash generation.
Successful stock repurchases to enhance shareholder value.
Acquisition of La Nacional and i-Transfer contributing to revenue growth.
Guidance provided for full-year 2024 and first quarter 2024.
Non-GAAP financial measures used to evaluate company performance.
Conference call and webcast scheduled for investor and analyst presentation.
The reported financial results from International Money Express, Inc. (Intermex) highlight a robust performance with significant increases in key metrics such as revenue, diluted EPS and Adjusted EBITDA. The 11.2% revenue growth in Q4 and 20.5% for the full year, along with Adjusted EBITDA increases of 14.5% and 14.0% respectively, suggest a strong operational efficiency and effective cost management within the company.
Intermex's focus on an omnichannel strategy, including acquisitions such as La Nacional and i-Transfer, has contributed to a substantial growth in unique active customers and a notable surge in digital transactions. This digital growth is particularly relevant as it indicates successful adaptation to consumer behavior trends and resilience in the face of market headwinds. Additionally, the 25.9% increase in Net Free Cash Generated indicates a healthy cash flow position, which is crucial for future investments and share repurchase programs that can enhance shareholder value.
However, investors should be mindful of the non-GAAP financial measures used, such as Adjusted EBITDA and Adjusted EPS, which exclude certain expenses that are considered non-recurring or not core to the business. While these measures provide a more focused view of operational performance, they should be considered alongside GAAP measures to understand the company's financial health comprehensively.
The reported increase in unique active customers and transaction volume, including a 43.1% growth in digital transactions, reflects Intermex's successful penetration into the money transfer market. The omnichannel approach, combining physical and digital touchpoints, is increasingly important in the financial services industry, particularly in remittances, where convenience and accessibility are key drivers of customer loyalty and market share.
Intermex's expansion through acquisitions is a strategic move to enhance their service offerings and geographic reach, especially in lucrative corridors to Latin America and the Caribbean. The growth in principal transferred by 6.9% to $6.2 billion also underscores the increasing volume of remittances, which is a positive indicator for the company's core business. The remittance industry is typically resilient to economic downturns as migrant workers continue to send money home, which could mean a stable revenue stream for Intermex in various market conditions.
Looking ahead, the guidance provided for 2024 suggests a confident outlook from management, projecting further revenue and earnings growth. This forward-looking information is pivotal for investors and analysts to gauge the company's trajectory and evaluate its potential in the context of the broader financial services sector.
The financial outcomes reported by Intermex can be seen as a microcosm of the broader economic environment where digital financial services are gaining prominence. The significant increase in digital transactions is indicative of a larger trend towards digitalization in the financial sector, driven by consumer demand for convenience and efficiency.
Intermex's performance, particularly in the context of rising net income and free cash flow, suggests a robust demand for remittance services, which often correlates with economic conditions in both the sending and receiving countries. The remittance industry's growth can have multiplier effects on the economies of recipient countries, often contributing to their GDP and development.
Moreover, Intermex's strategic acquisitions and the resulting synergy could be a response to competitive pressures in the remittance industry, where scale and network size are critical for maintaining competitive transaction fees and exchange rates. The company's ability to generate and increase free cash flow provides them with the flexibility to navigate economic uncertainties and potentially capitalize on investment opportunities to drive future growth.
02/27/2024 - 08:00 AM
Company generates strong earnings and margins, continued execution of omnichannel strategy
Company to Host Conference Call Today at 9 a.m. ET
MIAMI, Feb. 27, 2024 (GLOBE NEWSWIRE) -- International Money Express, Inc. (NASDAQ: IMXI) (“Intermex” or the “Company”), one of the nation’s leading omnichannel money transfer services to Latin America and the Caribbean, today reported strong operating results for the fourth quarter and full year 2023.
Financial performance highlights for the fourth quarter of 2023 compared with the same period last year are:
Revenues of $171.8 million , an increase of 11.2% ; Diluted EPS of $0.49 per share, an increase of 40.0% ; Adjusted Diluted EPS of $0.56 per share, an increase of 21.7% ; Adjusted EBITDA of $33.3 million , an increase of 14.5% ; and Net Free Cash Generated of $17.2 million , an increase of 25.9% . Financial performance highlights for the full-year 2023 compared with the prior-year are:
Revenues of $658.7 million , an increase of 20.5% ; Diluted EPS of $1.63 , an increase of 10.1% ; Adjusted Diluted EPS of $1.95 , an increase of 7.7% ; Adjusted EBITDA of $120.0 million , an increase of 14.0% ; and Net Free Cash Generated of $61.7 million , an increase of 3.6% . Bob Lisy, Chairman, President, and CEO of Intermex, stated, “We are proud to deliver another quarter of strong earnings growth as we continue to execute on our omnichannel strategy. We were able to again achieve double-digit revenue growth, performing well despite market headwinds. Our keen focus on margins and cost control helped deliver outsized growth in EPS, Adjusted EBITDA, and Adjusted EPS. Our highly efficient business model provides strong cash generation under already low leverage - allowing us to invest to accelerate growth while opportunistically purchasing shares in the market."
Fourth Quarter 2023 Financial Results (all comparisons are to the Fourth Quarter 2022 ) $171.8 million , up 11.2% . Contributing to the revenue growth is solid growth in the underlying business and the acquisition of La Nacional in the U.S. and i-Transfer in Europe. Contributing to the revenue growth was an over 13% increase in unique, active customers to 4.2 million, who generated 15.3 million money transfer transactions, an increase of 11.7% . Also contributing to the growth in the number of transactions was the 43.1% growth in digital transactions. Transaction growth resulted in $6.2 billion in principal transferred, a 6.9% increase.
Net income was $17.5 million , an increase of 33.9% . Diluted earnings per share were $0.49 , an increase of 40.0% . Net income and diluted EPS are impacted by an increase in revenues partially offset by higher service charges from agents and banks, increasing at a lower rate than revenues and increased operating expenses, which reflect a full year of La Nacional and partial year of i-Transfer. Higher interest expense, depreciation & amortization - much of it acquisition related and lower transaction costs also impacted net income. Diluted earnings per share growth also reflects the positive benefits of the Company's stock repurchases.
Adjusted EBITDA increased 14.5% to $33.3 million , driven by the business operating results discussed above offset by a lower impact of the adjusting items shown in the reconciliation table below.
Adjusted net income increased 13.5% to $19.9 million , and adjusted diluted earnings per share was $0.56 , an increase of 21.7% . Adjusted net income and adjusted diluted EPS were impacted by the items noted above in net income, adjusted for certain non-cash expenses and lower transaction costs that are detailed in the reconciliation table below following the consolidated financial statements. Adjusted EPS also benefited from the Company's stock repurchases.
Full-year 2023 Financial Results (all comparisons are to the full-year 2022) 20.5% to $658.7 million . Driving that growth was a 22.7% increase in net money transfer transactions - driven by continued growth in the core business and the acquisition of La Nacional in the U.S. and i-Transfer in Europe. A 58.9% increase in digital transactions initiated also contributed to the Company's growth. Total principal sent increased 17.2% to $24.5 billion .
Net income was $59.5 million , an increase of 3.8% . Diluted earnings per share were $1.63 , an increase of 10.1% , attributable to the year-to-date effects of the same items noted above for the quarterly results. In addition, the full-year 2022 net income was impacted by a $2.9 million tax benefit that did not recur in 2023.
Adjusted EBITDA increased 14.0% to $120.0 million , attributable to the same items noted above for the quarterly operating results and the higher net effect of the adjusting items detailed in the reconciliation table below.
Adjusted net income totaled $71.0 million , an increase of 1.5% . Adjusted diluted earnings per share totaled $1.95 , an increase of 7.7% , attributable to the same items noted above for the quarterly results.
Adjusted and other non-GAAP measures discussed above and elsewhere in this press release are defined below under the heading Non-GAAP Measures.
Other Items $239.2 million in cash and cash equivalents. Net Free Cash Generated for the fourth quarter was $17.2 million , up 25.9% , compared to the fourth quarter of 2022. Higher year-over-year free cash generated was favorably impacted by growth in net income, impacted moderately by an increase in capital spending associated with upgrading hardware and software within the U.S. agent base.
The Company repurchased approximately 523,000 shares of its common stock for $10.0 million during the fourth quarter of 2023 through its underlying share repurchase program. The Company also repurchased 770,403 shares for $15.3 million through privately-negotiated transactions.
Guidance
Full-year 2024:
Revenue of $681.0 million to $701.8 million . Diluted EPS of $1.81 t o $1.96 . Adjusted EBITDA of $124.0 million to $127.7 million . Adjusted Diluted EPS of $2.13 t o $2.31 . First quarter 2024:
Revenue of $150.4 million to $155.0 million . Diluted EPS of $0.32 t o $0.35 . Adjusted EBITDA of $24.4 million to $25.1 million . Adjusted Diluted EPS of $0.39 t o $0.42 . Non-GAAP Measures
Adjusted Net Income is defined as Net Income adjusted to add back certain charges and expenses, such as non-cash amortization of intangible assets resulting from business acquisition transactions, non-cash compensation costs, and other items outlined in the reconciliation table below, as these charges and expenses are not considered a part of our core business operations and are not an indicator of ongoing future Company performance.
Adjusted Earnings per Share – Basic and Diluted is calculated by dividing Adjusted Net Income by GAAP weighted-average common shares outstanding (basic and diluted).
Adjusted EBITDA is defined as Net Income before depreciation and amortization, interest expense, income taxes, and adjusted to add back certain charges and expenses, such as non-cash compensation costs and other items outlined in the reconciliation table below, as these charges and expenses are not considered a part of our core business operations and are not an indicator of ongoing future Company performance.
Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by Revenues.
Net Free Cash Generated is defined as Net Income before provision for credit losses and depreciation and amortization adjusted to add back certain non-cash charges and expenses, such as non-cash compensation costs, and reduced by cash used in investing activities and servicing of our debt obligations.
Adjusted Net Income, Adjusted Earnings per Share, Adjusted EBITDA, Adjusted EBITDA Margin, and Net Free Cash Generated are non-GAAP financial measures and should not be considered as an alternative to operating income, net income, net income margin or earnings per share, as a measure of operating performance or cash flows, or as a measure of liquidity. Non-GAAP financial measures are not necessarily calculated the same way by different companies and should not be considered a substitute for or superior to U.S. GAAP.
Reconciliations of Net Income, the Company’s closest GAAP measure, to Adjusted Net Income, Adjusted EBITDA, and Net Free Cash Generated, as well as a reconciliation of Earnings per Share to Adjusted Earnings per Share and Net Income Margin to Adjusted EBITDA Margin, are outlined in the tables below following the consolidated financial statements. A quantitative reconciliation of projected Adjusted EBITDA and Adjusted Diluted EPS to the most comparable GAAP measure is not available without unreasonable efforts because of the inherent difficulty in forecasting and quantifying the amounts necessary under GAAP guidance for operating or other adjusted items including, without limitation, costs and expenses related to acquisitions and other transactions, share-based compensation, tax effects of certain adjustments and losses related to legal contingencies or disposal of assets. For the same reasons, we are unable to address the probable significance of the unavailable information.
Investor and Analyst Conference Call / Presentation
The conference call and accompanying slides will be available via webcast at https://investors.intermexonline.com/
A webcast replay will be available approximately 2-4 hours after the conference call at https://investors.intermexonline.com/ .
Safe Harbor Compliance Statement for Forward-Looking Statements
About International Money Express, Inc. www.intermexonline.com
Alex Sadowski asadowski@intermexusa.com
Consolidated Balance Sheets December 31, December 31, (in thousands of dollars) 2023 2022 ASSETS (Unaudited) Current assets: Cash and cash equivalents $ 239,203 $ 149,493 Accounts receivable, net 155,237 129,808 Prepaid wires, net 28,366 90,386 Prepaid expenses and other current assets 10,068 12,749 Total current assets 432,874 382,436 Property and equipment, net 31,656 28,160 Goodwill 53,986 49,774 Intangible assets, net 18,143 19,826 Other assets 40,153 31,876 Total assets $ 576,812 $ 512,072 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt, net $ 7,163 $ 4,975 Accounts payable 36,507 25,686 Wire transfers and money orders payable, net 125,042 112,251 Accrued and other liabilities 54,661 41,855 Total current liabilities 223,373 184,767 Long-term liabilities: Debt, net 181,073 150,235 Lease liabilities, net 22,670 23,272 Deferred tax liability, net 659 3,892 Total long-term liabilities 204,402 177,399 Stockholders' equity: Total stockholders' equity 149,037 149,906 Total liabilities and stockholders' equity $ 576,812 $ 512,072
Consolidated Statements of Income Three Months Ended December 31, Year Ended December 31, (in thousands of dollars, except for per share data) 2023 2022 2023 2022 2021 (Unaudited) (Unaudited) Revenues: Wire transfer and money order fees, net $ 145,185 $ 132,822 $ 561,540 $ 469,162 $ 393,241 Foreign exchange gain, net 23,669 20,201 87,908 72,920 62,832 Other income 2,929 1,414 9,287 4,723 3,133 Total revenues 171,783 154,437 658,735 546,805 459,206 Operating expenses: Service charges from agents and banks 110,882 102,087 430,865 364,804 307,458 Salaries and benefits 18,675 15,313 71,090 52,224 43,065 Other selling, general and administrative expenses 11,181 9,904 47,979 34,394 30,334 Transaction costs 33 2,531 445 3,005 1,006 Depreciation and amortization 3,355 2,758 12,866 9,470 9,491 Total operating expenses 144,126 132,593 563,245 463,897 391,354 Operating income 27,657 21,844 95,490 82,908 67,852 Interest expense 2,783 2,099 10,426 5,629 4,537 Income before income taxes 24,874 19,745 85,064 77,279 63,315 Income tax provision 7,375 6,678 25,549 19,948 16,472 Net income $ 17,499 $ 13,067 $ 59,515 $ 57,331 $ 46,843 Earnings per common share: Basic $ 0.51 $ 0.35 $ 1.67 $ 1.52 $ 1.22 Diluted $ 0.49 $ 0.35 $ 1.63 $ 1.48 $ 1.20 Weighted-average common shares outstanding: Basic 34,638,245 36,941,754 35,604,582 37,733,047 38,474,040 Diluted 35,426,435 37,788,404 36,429,714 38,625,390 39,103,450
Reconciliation from Net Income to Adjusted Net Income Three Months Ended December 31, Year Ended December 31, (in thousands of dollars, except for per share data) 2023 2022 2023 2022 2021 (Unaudited) (Unaudited) Net income $ 17,499 $ 13,067 $ 59,515 $ 57,331 $ 46,843 Adjusted for: Share-based compensation (a) 1,894 1,560 8,111 7,118 4,601 Restructuring costs (b) 69 — 1,214 — — Transaction costs (c) 34 2,531 445 3,005 1,006 Loss on bank closure (d) — — — 1,583 2,000 Other charges and expenses (e) 294 382 1,850 1,141 1,705 Amortization of intangibles (f) 1,178 1,186 4,740 4,102 5,052 Income tax benefit related to adjustments (g) (1,042 ) (1,176 ) (4,914 ) (4,376 ) (3,738 ) Adjusted net income $ 19,926 $ 17,550 $ 70,961 $ 69,904 $ 57,469 Adjusted earnings per common share: Basic $ 0.58 $ 0.48 $ 1.99 $ 1.85 $ 1.49 Diluted $ 0.56 $ 0.46 $ 1.95 $ 1.81 $ 1.47
(a) Represents shared-based compensation relating to equity awards granted primarily to employees and independent directors of the Company. (b) Represents primarily severance, write-off of fixed assets and professional fees related to the restructuring of La Nacional. (c) Represents primarily financial advisory, professional and legal fees related to business acquisition transactions. (d) Represents losses related to the closure of a financial institution in Mexico during 2021. (e) Represents primarily loss on disposal of fixed assets. (f) Represents the amortization of intangible assets that resulted from business acquisition transactions. (g) Represents the current and deferred tax impact of the taxable adjustments to Net Income using the Company’s blended federal and state tax rate for each period. Relevant tax-deductible adjustments include all adjustments to net income.
Reconciliation from GAAP Basic Earnings per Share to Adjusted Basic Earnings per Share Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 (Unaudited) (Unaudited) GAAP Basic Earnings per Share $ 0.51 $ 0.35 $ 1.67 $ 1.52 Adjusted for: Share-based compensation 0.05 0.04 0.23 0.19 Restructuring costs — — 0.03 — Transaction costs — 0.07 0.01 0.08 Loss on bank closure — — — 0.04 Other charges and expenses 0.01 0.01 0.05 0.03 Amortization of intangibles 0.03 0.03 0.13 0.11 Income tax benefit related to adjustments (0.03 ) (0.03 ) (0.14 ) (0.12 ) Non-GAAP Adjusted Basic Earnings per Share $ 0.58 $ 0.48 $ 1.99 $ 1.85
The table above may contain slight summation differences due to rounding
Reconciliation from GAAP Diluted Earnings per Share to Adjusted Diluted Earnings per Share Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 (Unaudited) (Unaudited) GAAP Diluted Earnings per Share $ 0.49 $ 0.35 $ 1.63 $ 1.48 Adjusted for: Share-based compensation 0.05 0.04 0.22 0.18 Restructuring costs — — 0.03 — Transaction costs — 0.07 0.01 0.08 Loss on bank closure — — — 0.04 Other charges and expenses 0.01 0.01 0.05 0.03 Amortization of intangibles 0.03 0.03 0.13 0.11 Income tax benefit related to adjustments (0.03 ) (0.03 ) (0.13 ) (0.11 ) Non-GAAP Adjusted Diluted Earnings per Share $ 0.56 $ 0.46 $ 1.95 $ 1.81
The table above may contain slight summation differences due to rounding
Reconciliation from Net Income to Adjusted EBITDA Three Months Ended December 31, Year Ended December 31, (in thousands of dollars) 2023 2022 2023 2022 2021 (Unaudited) (Unaudited) Net income $ 17,499 $ 13,067 $ 59,515 $ 57,331 $ 46,843 Adjusted for: Interest expense 2,783 2,099 10,426 5,629 4,537 Income tax provision 7,375 6,678 25,549 19,948 16,472 Depreciation and amortization 3,355 2,758 12,866 9,470 9,491 EBITDA 31,012 24,602 108,356 92,378 77,343 Share-based compensation (a) 1,894 1,560 8,111 7,118 4,601 Restructuring costs (b) 69 — 1,214 — — Transaction costs (c) 34 2,531 445 3,005 1,006 Loss on bank closure (d) — — — 1,583 2,000 Other charges and expenses (e) 294 383 1,850 1,141 1,705 Adjusted EBITDA $ 33,303 $ 29,076 $ 119,976 $ 105,225 $ 86,655
(a) Represents share-based compensation relating to equity awards granted primarily to employees and independent directors of the Company. (b) Represents primarily severance, write-off of fixed assets and professional fees related to the restructuring of La Nacional. (c) Represents primarily financial advisory, professional and legal fees related to business acquisition transactions. (d) Represents losses related to the closure of a financial institution in Mexico during 2021. (e) Represents primarily loss on disposal of fixed assets.
Reconciliation from Net Income Margin to Adjusted EBITDA Margin Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 (Unaudited) (Unaudited) Net Income Margin 10.2 % 8.5 % 9.0 % 10.5 % Adjusted for: Interest expense 1.6 % 1.4 % 1.6 % 1.0 % Income tax provision 4.3 % 4.3 % 3.9 % 3.6 % Depreciation and amortization 2.0 % 1.8 % 2.0 % 1.7 % EBITDA 18.1 % 15.9 % 16.4 % 16.9 % Share-based compensation 1.1 % 1.0 % 1.2 % 1.3 % Restructuring costs — % — % 0.2 % — % Transaction costs — % 1.6 % 0.1 % 0.5 % Loss on bank closure — % — % — % 0.3 % Other charges and expenses 0.2 % 0.2 % 0.3 % 0.2 % Adjusted EBITDA Margin 19.4 % 18.8 % 18.2 % 19.3 %
The table above may contain slight summation differences due to rounding
Reconciliation of Net Income to Net Free Cash Generated Three Months Ended December 31, Year Ended December 31, (in thousands of dollars) 2023 2022 2023 2022 2021 (Unaudited) (Unaudited) Net income for the period $ 17,499 $ 13,067 $ 59,515 $ 57,331 $ 46,843 Depreciation and amortization 3,355 2,758 12,866 9,470 9,491 Share-based compensation 1,894 1,560 8,111 7,118 4,601 Provision for credit losses 1,227 550 4,997 2,572 1,537 Cash used in investing activities (5,092 ) (3,149 ) (18,280 ) (12,529 ) (10,773 ) Term loan pay downs (1,641 ) (1,094 ) (5,469 ) (4,375 ) (4,103 ) Net free cash generated during the period $ 17,242 $ 13,692 $ 61,740 $ 59,587 $ 47,596
What were the financial highlights for International Money Express, Inc. (IMXI) in Q4 2023?
In Q4 2023, IMXI reported revenues of $171.8 million, a 11.2% increase, diluted EPS of $0.49 per share, a 40.0% increase, and adjusted EBITDA of $33.3 million, a 14.5% increase.
How did IMXI perform in terms of net free cash generated in Q4 2023?
IMXI generated $17.2 million in net free cash in Q4 2023, showing a 25.9% increase compared to the same period in 2022.
What contributed to the revenue growth for IMXI in Q4 2023?
Revenue growth in Q4 2023 was driven by solid growth in the underlying business and the acquisitions of La Nacional in the U.S. and i-Transfer in Europe.
What was the total principal transferred by IMXI in Q4 2023?
IMXI transferred $6.2 billion in principal in Q4 2023, showing a 6.9% increase.
How did IMXI perform in terms of adjusted EBITDA in full-year 2023?
IMXI's adjusted EBITDA for full-year 2023 was $120.0 million, a 14.0% increase compared to the prior year.
What is the guidance provided by IMXI for full-year 2024 in terms of revenue?
IMXI provided guidance of $681.0 million to $701.8 million in revenue for full-year 2024.
What are the non-GAAP financial measures used by IMXI?
IMXI uses non-GAAP financial measures such as Adjusted Net Income, Adjusted Earnings per Share, Adjusted EBITDA, Adjusted EBITDA Margin, and Net Free Cash Generated to evaluate its financial performance.
When is the investor and analyst conference call scheduled for IMXI?
IMXI will host a conference call and webcast presentation at 9:00 a.m. Eastern Time today. Dial 1-844-826-3033 (U.S.) or 1-412-317-5185 (outside the U.S.) to join.
