Western Union reported strong fourth-quarter earnings helped by digital
Western Union, one of the biggest money transfer companies in the world, reported strong fourth-quarter earnings on Wednesday.
Strong revenue amid the pandemic
In a statement on Wednesday, Western Union said that it made $1.3 billion in the fourth quarter. This was a 3% decline from the same quarter in 2020 but it was $10 million above what Wall Street analysts were expecting. Its share price rose by more than 1% in extended hours.
The company attributed this decline to currency issues and the impact of the coronavirus pandemic.
In the same statement, the firm said it would boost its dividend by 4% and resume its share repurchase program this quarter. Further numbers showed that its gross, operating, and net income margins increased in the quarter while the total revenue fell to $9.8 billion in 2020. The CEO said:
“Despite the disruption from the pandemic, we remained highly focused on our growth strategy, driving exceptional results in our digital business and building the foundation for our future”
Strong digital sales
Western Union and other money transfer companies have benefited substantially because of their investments in digital. Indeed, the firm’s digital revenue increased by 36% in the fourth quarter. They represented about 32% of the total consumer-to-consumer (C2C) revenues.
Westernunion.com revenue rose by 27% while the monthly active users rose by 49%. According to SensorTower, its app was among the most downloaded in its category. The firm is now eying more than $1 billion in revenue from this segment.
Its business-to-business segment lagged. Its revenue declined by 8% because of the impacts of the pandemic.