Q4 2021 International Money Express Inc Earnings Call
[music].
Greetings welcome to International Money Express fourth quarter 2021 earnings Conference call.
At this time all participants are in a listen only mode.
A question and answer session will follow the formal presentation.
If anyone today should require operator assistance during the conference. Please press star zero from your telephone keypad.
Note that today's conference is being recorded.
At this time I will turn the conference over to Mike <unk>, Vice President of Investor Relations.
Mr. <unk> you may now begin.
Good morning, everyone and welcome to our quarterly earnings call I would like to remind you that today's call includes forward looking statements, including our 2022 guidance and that actual results may differ materially from expectations.
For additional information on international money Express, which we refer to as <unk> or the company. Please see our SEC filings, including the risk factors described therein.
All forward looking statements on this call are based on assumptions and beliefs as of today.
You should not rely on our forward looking statements as predictions of future events.
Please refer to slide two of our presentation for a description of certain forward looking statements.
The company undertakes no obligation to update such information, except as required by applicable law.
On this conference call, we will discuss certain non-GAAP financial measures.
Information required under Reg G under the Securities and Exchange Act with respect to such non-GAAP financial measures is included in the presentation slides our earnings press release, and our annual report on Form 10-K , including reconciliation of certain non-GAAP financial measures to the appropriate.
Preet GAAP measures.
These can be obtained in the investors section of our website at <unk> online Dot com.
On today's call will be our chairman and Chief Executive Officer, and President, Bob <unk>, and Chief Financial Officer Andreas <unk>.
Also on the call today is Joseph Aguilar, Chief Operating Officer, Randy Nelson, Chief Revenue Officer, and Chris Hall, Chief Information Officer, Let me now turn the call over to Bob.
Good morning, and thank you for joining US today, we're proud to announce the fourth quarter and 2021 year ending results. Let me highlight some of our accomplishments on slide three compared with fourth quarter and full year 2020.
We achieved revenue of $127 million or 28% increase versus last year net income of $13 million, 37% increase adjusted net income was $16 million, an increase of 36% and adjusted EBITDA for the quarter of $24 million an increase of 27%.
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For the year revenues were $459 million, an increase of 29% over the previous year net income was $47 million an increase of 39% adjusted income was $57 million an increase of 36% adjusted EBITDA was $87 million an increase of 27%.
These are very impressive results in their own right, but even more impressive given the comparison to a very strong results of 2024th quarter and full year in which revenues increased 19% and 12% respectively. Net income increased 80% on the quarter and 72% for the year and adjusted EBITDA grew at 32.
2% and 19%.
Two year growth for 2021 was 45% in revenue, 139% of net income and 51% and adjusted EBITDA. We are truly a stronger more profitable company than we were when the pandemic began in 2020.
This performance validates our high quality Omnichannel customer focus strategy. The company utilizes cutting edge high Tech proprietary software through every step of our business to meet the customers, where they choose to transact whether digitally or in person.
This allows <unk> to deliver a robust and easy to use 18 interface provide our services efficiently and support back office. It infrastructure as a result, intermix exhibits all of the characteristics of a high tech growth company.
Importantly, as I will discuss more in greater detail momentarily because of the service we provide to our customers is essential our business was built to operate well in both good times and a challenging economic environment. We firmly believe dispositions intermix to take advantage of a very long runway ahead.
Before I provide additional color on the customer side of the business I would like to discuss the company's strategy related to our agent partners, who are carefully chosen to ensure that they share our philosophy of providing superior customer service and support.
Our service is vital to customers, who may be sending funds to assist their families critical needs in such areas as housing food and medical expenses, we accept that responsibility and work diligently to deliver 100% of the time, we fully expect the agents with whom we work to have the same sense of urgency realizing that our services.
A central and May be life changing our agents are located in areas that have been strategically selected including the demographic characteristics of the geographies to help meet the needs of each and every consumer.
The agents, who partner with us benefit from using our cutting edge proprietary software that enables the fastest remittance processing in the industry. We continue to endeavor to upgrade our industry leading platform at retail and in 2021, we invest in significant enhancements. One of these investments is the launch of our new Intermix direct <unk>.
<unk> software application in December , which features both upgrades and hardware and software.
Intermix direct provides the added benefit of streamlining the process for agents by allowing them to log into one system and access multiple applications with added security and enhancements. The system also benefits intermix through better reporting and the ability to provide continuous improved support.
Agents also choose <unk> because of our strong compliance culture that we have built and in which we continue to invest those investments span systems and people to ensure that intermix remains best in class and at the forefront of the remittance industry.
Strong compliance culture allows agents to utilize our extensive network of banking relationships and conveniently located local branches deposit funds.
This is an important fact, because some of the banks are not willing to banks small businesses that generate large amounts of cash deposits with intermix wide network of banking relationships. We can solve this problem by providing intermix owned bank accounts for the agent partner to deposit into.
Finally agents benefit from the same top notch unparalleled customer service as to our customers with average speed of answering calls within five seconds and often faster. This quick turnaround time frees the agent to focus on customer service, resulting in shorter wait times and more satisfied customers.
We also provide significant value to our customers on the product side as intermix firmly believes in providing the customer with choices that best meet how they want to conduct a transaction, we give our consumers the choice of initiating a transaction remotely via our digital app or in person at one of our convenient agent locations are.
Of our company operated stores consumers consent cash or use a debit card convenient retail location or they can use a debit card credit card or bank account to initiate a transaction online.
Its a philosophy of consumer choice also extends to how remittances are received and paid in country.
Our customers beneficiaries can receive money digitally into their bank accounts loaded on a mobile wallet paid out in an ATM paid out over the counter in a convenient retail location or home delivered importantly, all of these funds are available in minutes.
We have further enhanced customer choice with the launch of our new digital application. This week. This app offers consumers the option of selecting lower fees are higher exchange rate in real time. It also includes enhanced functionality that provides consumers with several options to fund their remittances and payout methods.
As with our retail based remittances funds are available within minutes and backed by our world class customer care.
The new Intermix application also contains an intuitive navigation flow that allows users to funded remains with debit or credit card or ECH for transfer users can select a variety of receiving methods, including cashback pickup at thousands of locations direct deposits into bank accounts debit cards mobile wallets.
In home delivery in select markets Intermix also expects to make this application available to our co branded digital and mobile partners in Latin America and Asia.
This omnichannel customer focused strategy has generated strong and consistent growth per intermix and has resulted in our taking market share from our competitors on.
On slide four in the fourth quarter of 2021, our market share increased to 21% to a record high in our core markets of Mexico, Guatemala, El Salvador, and Honduras BPC.
Besides the strong growth we have generated in our core markets as shown on slide five emerging markets such as the Dominican Republic, Ecuador in Nicaragua, among others continue to experience strong growth during the quarter, our emerging market business is one of our many bright spots with transactions, increasing 32% from the fourth quarter of 2020.
Turning to slide six as I previously noted intermix is continuing to invest in our digital application and you see the Companys continued progress in our digital initiatives with transactions, increasing 96% versus the prior year period.
Some of our peers defined a digital transaction is one where either side of the remittances cashless.
Based on this definition intermix currently processes more than 24% of its transactions digitally.
Were they were initiated as cashless transactions on the send side or settle this cashless on the receive side.
During the fourth quarter transactions that were deposited directly into bank accounts increased 44% compared with the prior year period transactions processed through the use of the debit card at retail are a small percentage of our overall wires, but grew at 98% year over year. We expect these transactions will continue to increase as we expand the <unk>.
There are retailers, who accept debit cards.
Lastly, another key pillar of our growth strategy is our card product, where some of our 2021 investment was directed this category includes car direct prepaid Mastercard and payroll Mastercard, we have been enhancing our systems infrastructure to efficiently and effectively support these products while also.
Adding field sales and support personnel to expand our presence in the market to drive meaningful contribution to future revenue and profitability.
We plan on discussing more in this product category at Investor Day, We are holding later today, which will be available by webcast for those of you unable to attend in person.
And a second I will turn the call over to our CFO Andrew spending for his remarks on our record financial performance that intermix delivered for fourth quarter and for full year 2021.
I will conclude by reiterating how our unique customer focused strategy that provides choice matched with high quality products in the form of reliable fast money remittance supported by quality agents and customer service and utilizing proprietary apps and infrastructure is sustainable and differentiating ourselves.
This strategy has produced peer leading results and positions inner mix as our high growth Fintech leader with sustainable long term growth strategy. We believe 2022 will be another year of strong market share growth coupled with double digit increases in revenue net income and adjusted EBITDA and we look forward to sharing our continued <unk>.
Progress with you now I will turn the call over to Anders.
Thanks, Bob and good morning to everyone moving to slide seven let's walk through the fourth quarter results in a bit more detail.
As Bob highlighted it was another quarter and year of stellar execution, along with growth in all areas of the business with plenty of milestones achieved across our key measures. These impressive results reflected our focus on providing high quality customer service matched with our Omnichannel distribution strategy. We are successfully meeting our customers where they live or work.
And we're providing them with product and service choices that best suit their needs backed by World Class service. It is important remember that we do not compete on price for our customers quality dependability and choice are more important than being the least expenses as Bob referenced we're providing our customers with the critical lifeline service for their fans.
Please.
In 2021, and we talked a great deal about the investments, we're making in systems people and products as Bob noted the rollout of <unk> direct is made agents even more productive at the same time, we've added field sales and support personnel, primarily west of the Mississippi.
These initiatives have resulted in continued agent growth and productivity in.
In the fourth quarter digital transactions initiated increased 96% over the prior year period, which is especially gratifying considering we achieved those results with our legacy digital App and with limited marketing dollars. This growth comes on top of already strong growth in 2020.
With the deployment and rollout of a new world class App will be increasing our efforts to generate continued high growth from our digital App service. In addition to our very strong digital growth in the fourth quarter of 2021, we realized 12% agent growth compared with the prior year quarter with a specific focus on Asian growth West of the Mississippi as I've mentioned.
Earlier.
These agents helped drive 20% growth in customers for the quarter, we generated a 24% increase in transactions to $11 million, while sending 40% more principal totaling $5 billion for the quarter.
Included in those strong transaction numbers as the growth in the number of digital transactions that I, just mentioned and the 32% growth in our emerging market countries continues our trend of growth in this market at an accelerated pace.
On slide eight all of these positive growth drivers generated a 28% growth in revenues compared with the 2024th quarter, finishing at $127 million Importantly, we believe this strong growth drivers provide a significant runway in 2022 and beyond we will also be discussing our plans and strategy in more detail at our invest.
Your day later today.
Through our continued focus on effective expense management and economically positive investments in people products and support GAAP net income for the quarter was just over $13 million up 37% versus the prior year period, our strong topline was the key driver with lower depreciation amortization and interest expense also contributing.
Due to a solid bottom line results.
These improvements were partially offset by the expected increases in salaries from higher sales head count as well as investments related to new product initiatives such as the card products that Bob mentioned that we are rolling out in 2022 investments in digital including our new digital digital App and enhancements and modernization of our technology such as <unk>.
Next direct.
On slide nine excluding certain other expenses adjusted net income increased almost 36% to just under $16 million our strong growth in revenues, partially offset by the increase in operating expenses I previously mentioned resulted in a 27% growth in adjusted EBITDA to just under $24 million for the full.
Quarter of 2021.
Adjusted EBITDA margin for the quarter was steady at almost 19% consistent with the prior year level. Although at that time, we benefited from very stringent cost management related to a great deal of uncertainty as a result of the COVID-19 pandemic.
Turning to slide 10 for the full year <unk> results were influenced by similar drivers as in the fourth quarter. The company generated 29% growth in revenues to $459 million. This was driven by an 18% growth in customers that said, 25% more remittances during the 2021 year compared with the prior year.
While 2021 was a year of incremental investment in people products and technology, we continue to balance strong topline growth with significant growth and profitability due in large part to the very efficient operating model that we've created.
For the year the increase in revenues translated to a 39% growth in net income to $47 million and on slide 11 on an adjusted basis, we delivered 36% growth in adjusted net income to $57 million and 27% growth in adjusted EBITDA to $87 million, all very impressive growth numbers and just the latest in a long history.
Of double digit percentage growth and importantly, while intermix has been investing to drive future growth adjusted EBITDA margins have stayed very consistent in the high teens.
Moving to our balance sheet and cash on slide 12, we wanted to give some insight into how much cash the business generates because our settlement assets move so quickly Dave the week of the financial close can really muddy the water. If you try to interpret operating cash flows. So we normalize it through an internal measure recall free cash generated I would equate it to how much.
The salary ends up in the savings account in the end if.
If you can see on the left intermix generated $47 6 million net free cash in 2021, 26% higher than 2020. This means the company converted 55% of its adjusted EBITDA to net free cash generated for the year.
We need to underscore again that our working capital is very cyclical. However, amex ended the year with $132 million in cash and an undrawn revolver capacity of $150 million.
Looking at our capital allocation as we've demonstrated our preferred first use of cash is to reinvest in the business to accelerate our growth in what we do today already we also continue to look at inorganic growth opportunities that have a positive risk adjusted rate of return.
Finally in terms of the uses of cash in the fourth quarter of 2021, intermix repurchased approximately 271000 shares of our common stock for a total of $4 4 million for all of 2021, the company repurchased approximately 342000 shares for $5 6 million management continues to believe that repurchasing our.
Stock is a very attractive use of cash at these valuations moves.
Moving on to slide 13.
Given the strength of our fourth quarter and full year results, our execution trajectory and incredibly valuable and growing payments ecosystem. Our full year 2022 guidance for revenues net income adjusted net income and adjusted EBITDA as follows we expect revenue in the range of 537% to $546 million.
Net income in the range of 58% to $59 5 million adjusted net income in the range of 66 to $67 5 million and adjusted EBITDA in the range of $100 million to $102 million, we continue to balance revenue growth and profitability. While also continuing to invest in technology talent and Mark.
Getting to drive future growth for 2022 with the launch of our new and improved <unk>, we expect to see strong digital growth along with growth in our card products management also expects to increase market share by further growing our productive agent base and the retail channel, which means more customers in more transactions for internet.
As our guidance shows we believe <unk> has a strong and sustainable growth opportunity ahead of it and we are in a great position to take advantage of that opportunity by continue to be an innovator and leader in the fintech space with a unique and differentiated service delivered by Omnichannel with that let me turn the call back to the operator for questions.
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One moment, please while we poll for questions once again star one.
Thank you. Our first question is from the line of David Scharf with JMP Securities. Please proceed with your question.
Hi, good morning.
Thanks for taking my questions.
Congrats on that.
Another tremendous year.
Hey.
I'll, let others kind of pile on with all the digital questions I had a couple more mundane ones.
Hey, Bob we have seen the average remittance size.
Trend upward really for the last couple of years throughout the pandemic.
I don't know if wage pressure and inflation are contributing to that but as we think about the very strong revenue guidance you just rolled out for 'twenty two.
Are you anticipating.
And sizes to continue to trend upward is that embedded in your guidance.
Yes. This is Andrew I'll take that David I think.
We can't count on year over year growth like that which is really outsized last year. So we've tapered back our expectations on that and modeled and minimal growth in 2022. So if it does continue on the right that's going to be a tailwind for us.
Got it.
Okay and then.
The follow up.
Question I know.
Last quarter you.
You talked about kind of building a sales effort.
This car direct.
Initiatives basically to get payroll cards to employers.
And I believe.
You may have added somebody.
From a prepaid issuer in the past build that commercial sales effort is that.
Is that effort actually begun is there any kind of update you can provide there.
Yeah.
Sure Hi, David This is Randy.
Yes to answer your question, we've got a team now of eight salespeople selling.
To employers and.
Doing a good job I think we ended the year with.
Right around 35 employers working with us.
Got it.
Is there is there an employee count youre able to share maybe to this 35 employers in aggregate represented.
Oh, yes.
I don't think we've really been sharing that because it's still a pretty.
Pretty competitive business into where we're going about it there's a lot of folks coming into the industry and we're trying to keep that pretty close but I think it's.
What we can't tell you is that these are a lot of businesses that are right in the core of our consumers. So it's not only the card that we've put in their hands that we make money off of it but we're also empowering that consumer to then be more digitalized. They can either use their card than it is.
You heard in our expanding acceptance of credit card or debit card rather at retail and then of course online. So it's going in the hands of people not just indiscriminately to try to go out.
Lawyers, but employers that will be employing consumers that would be our joint consumers with re Memphis as well in the most part.
Got it terrific.
All right, that's really the value because people talk about digital but.
Empower that consumer.
We're not going to get them to be able to do a online digital until they have some kind of plastic in their hands.
Right.
Terrific. Thank you.
Our next question's from the line of Mark Palmer with BTG. Please proceed with your questions.
Yes, good morning.
Yeah.
Ill echo that.
The performance was very impressive guidance, calling for more of the same with regard to the 'twenty two guidance.
In your prepared remarks that <unk>.
<unk>.
Production agents was the key to.
Additional market share gains can you talk a little bit about the competitive dynamic in the space.
And what's going on with <unk>.
Other remittance firms such that Youre able to sustain.
These market share gains over time, which you have been doing for.
Quarters and years now.
Mark I'll start and then Randy Who's our Chief revenue Officer.
Jump in because he is going to be much closer to the action and have more of a granular stuff than I do but I.
I would tell you that there is a big misnomer in the marketplace about retail we don't want to shout, it too loudly, but youll see today from our.
From our Investor day that just how big the retail market has gotten over the last 10 years and so what we see as companies. Some of the biggest companies that are public recalibrate themselves to go with what the market believes is going on rather than what's going on and they really vacated retail Brian .
I won't mention any names but.
Can figure out who it is.
So that's a big piece there. The second piece is that and then we're competing against the small guys, which Randy will talk about just all the ways that we compete in a way that has advantages. We've always competed in a way that is value added. So we're not a commodity type provider.
Typically going to be.
The higher end of the pricing range, but with a lot of added value and we've seen our business have margins have really declined very very small over the years, while we've been.
Added a great deal more market share and taking customers from our competitors without being a discounter and thats really the key to it but part of this is that there is this dual in retail because some people have said there isn't a lot of applicable and I believe that there isn't and that's growing at a very high rate still it's still growing its not that its melting it is.
And we're the only guys that are really executing with any real power and resources to go at it day by day retailer by retailer ZIP code by ZIP code I'm, turning to Randy for a little bit addition, there yeah. Thanks Bob.
Mark what Bob said is exactly spot on I think it boils down to disciplined execution in each one of our sales Representatives has a quarterly sales plan that includes ads.
Adding agents and Unserved Zip codes.
Further penetrating underserved Zip code and focusing on.
Agents, where theres more market share and we're just not getting the amount of business out of that retailer that we think we should be so it really boils down to execution and.
The fact that we've got such great products, and such Great services and support these retailers better than our competitor just continues to provide us opportunity to take market share.
Thank you.
Questions I'm sorry go ahead, no I was just going to add is as we talked about a lot. This rifle shot approach, where we understand our market share it down to the ZIP code level and go in and recruit and really scan and in May.
To make sure that we get the very best retailer in the very best location really makes a big difference our retailer performance is so high compared to our.
Competitors, because we are bringing in the very best retailers because of the approach we take so it really makes a huge difference versus competitors that are indiscriminately, adding lots of retailers have become really.
Action versus quality retailers.
Thank you.
You have $132 $5 million in cash you have $150 million available under your revolver I know in the past.
We've talked about.
Any opportunities.
And.
Yes.
The opportunities that are out there have been extensive.
Given the pullback in the market.
And what's going on there.
There are you seeing any of those opportunities becoming more available.
Any softening with regard to prices such that there could be an opportunity.
To use some of that cash and revolver availability and M&A.
Yes.
Optimistic and further along related to M&A and we've had been in the past Theres nothing to report specifically at this time, but I think theres, a very good chance that youll see M&A activity from us this year.
But.
Can't really say for certain but absolutely we're seeing things that we think.
We will add to our business both at retail and also potentially things that might add to our business and vertical adjacent sort of businesses.
I may add to our business in different ways related to card and things like that so we think there are going to be opportunities out there more as the year unfolds.
But we were deeper than we have been so andrew might want to add to that.
I would also just add in terms of that cash position because of our working capital moves around so much.
That number is probably on the highest side, we drew more on the revolver this quarter more volume on the revolver than we ever had as a business. So depending on the day of the week, we're not we're not we're not as cash heavy as it may appear but.
We do have about how much in cash just so.
The Max we draw on the revolver is $40 million and we've got $150 million revolver. So you can do the math it was about 110 alright.
Unless my math is off there.
I just didn't want them to think it went from $1 32 to 50 right. So right.
Fair enough. Thank you.
Our next question is from the line of Alex <unk> with Keybanc capital markets. Please proceed with your question.
Yes, thanks for taking the question.
Nice to see the customer growth acceleration in the fourth quarter, just kind of curious as we look at the guide for 'twenty two.
Per cent midpoint.
Wanted to get your thoughts on how youre thinking about customer growth level in 2002.
No versus kind of what we saw in 'twenty, one and that's the 29% topline growth.
Yes, I mean I think that.
Victor.
Customer growth in <unk>.
<unk>, one was very very high and it's probably sometimes you can look at that it's disproportionate to the amount of retailers new retailers, we add it.
A little more conservative we tend to do that is.
Now we treat in our numbers for the year.
I'm, sorry, Pete in our numbers for the quarter mitigate 14th straight times.
Beaten raised a number of times. This year this past year in 'twenty. One so we're not assuming the same number of customer new customers. The way, we get a new customer retail typically is going into a geography that we haven't been in or going into geography, where we're underrepresented and we go into a new retailer that has customers that we haven't touched.
Before.
No. We don't expect that activity to go down dramatically as a matter of fact, we put more people in the field, particularly in the western region that should drive that growth, but I think if anything you would see that customer count is a little bit conservative and partly just because we are lapping a really big number right. As you continue to lap a number just like it was worth.
Lapping fourth quarter of 'twenty, one when we get to fourth quarter of 'twenty, two that the quarter will be a bit of a challenge because we're going to lap 27% EBITDA growth, it's kind of the same way as the customer count.
We expect to have another strong year of that but it's going to be on top of the strong growth that we had in 'twenty one.
Got it that's very helpful. Thank you and then just to clarify.
I guess the same question around agent growth.
Your comment more of that more or less a convergence of those growth rates versus maybe what we saw in 'twenty, one where it was kind of low double digit type agent growth with 20% customer growth.
To clarify what you were saying there around the disproportion in 'twenty one.
Yes, Hi, this is Randy I'll take that so yeah. They go hand in hand so.
As Bob mentioned as we add locations, where we're underrepresented is under represented or unrepresented than that first year almost all of the consumers are new to our franchise.
We see a second bump in customer acquisition that second year, because the retailer becomes more confident with our system's likes our services better they start.
Transition their customers that have been using competitive services over to us. So we really get two plus years of customer acquisition, when we add retail locations. So they go hand in hand.
Yeah.
Okay, great. Thank you well thank.
Thank you.
Our next question is from the line of Mike Grondahl with Northland Securities. Please proceed with your question.
Yes, good morning, guys and congrats on another very robust quarter.
Kind of a two part question.
You talked about the 12% growth in agents and I understand that strategy well.
Well.
Could you talk a little bit about where the backlog.
For new agents.
Just in relation to historical trends is it sort of above in line or below.
And then somewhat related to that is just sort of maybe Randy could give us an update on the overall sales force.
How that's trended the last six months and maybe your outlook there.
Yes, I mean, I don't think we call it a backlog I think where we see opportunity.
As again in certain markets, we always talk about the Western States, we still think California, Texas and other western States.
Are we have less retailers perform boards and so those are the places where there's opportunities and we have less wires per foreign borns in those markets and so that's the biggest place, but even in the eastern states. There is still pockets of opportunity for us. So we don't really see a backlog if you think of a backlog like.
Retailers, calling in and want to become an agent and we can't get to them. We really don't have that were out selecting agents were not necessarily passively responding to agent requests so we're going into specific.
Retail markets, where we know that there is an opportunity based on the demographic analysis, we use and how many wires we have today and we're seeking out the best retailers. So.
It's more about us, creating those opportunities and I'll turn it over to Randy we are investing much more in the Western States. We've got more people theyre selling today, but Randy will add a little more color to that sure. Thanks, Bob So as we mentioned on our last call.
Typically have an increase of about 20% to our retail sales team in Q4.
Brought them on in Q4 was the primary reason to work through their learning curve. So there could be contributing.
At 100% come 2022 so.
And that's exactly what happened so we hired that team of people they started making their contribution and as we hit 2022 were basically in full stride with that team.
Bob point, we've identified well over a thousand ZIP codes, both in the East and then the left but skewing to the west in terms of where we're underrepresented and where we have.
Resources pointed so we think that's going to make significant contribution this year that team.
Got it.
Hey, Bob anything to call out.
<unk> or insightful just related to Mexico or Guatemala.
I don't think so I think the markets have remained very very strong and I think.
We still have lots of opportunity I mean.
The market has been good and that a couple of companies that we're discounting a little bit more that were middle tier independents.
<unk> got private equity deals in the last year or two so some of that's come back a little bit. So I think pricing is maybe a little less pressured.
We've never really engaged in a fully we always ride with a value add so we might be three or four hikes in tahoe, it's more expensive to the consumer than the discounters.
It's still able to take the business from them at that level because of the quality of the service. So we're not seeing we still think there's opportunity we still grown our market share in each of those countries.
Guatemala, obviously being in the high 20, percents, but we think it can grow from there, particularly because of the opportunity in Texas, and California, and other Western States, Arizona, Nevada, Utah, Colorado.
The number of foreign borns, there really <unk> a number of foreign born in the East where we do a tremendous business already we have a great business in the west, but proportionately and Theres a lot of opportunity for growth Rep versus what we have in the east. So we're seeing a very good runway still I mean, when you look at the numbers that we produced in the fourth quarter.
In terms of growth.
Folks out of us when we went public in 2018 right in terms of passing you were one of them but.
And today.
Our EBITDA is two five times almost what we went out at our business as revenue is.
More than two it's about two five times, where we went out and we see that kind of continued growth now we're always very conservative and you see our guidance where it is it's pretty.
Pretty aggressive we don't we're not the type of company goes out and overstates and we recognize that growth on top of growth on top of growth. We just start to deal with the big denominator, but we think we've got tremendous growth opportunity and we think that this whole notion and by the way I don't want to undersell digital.
You'll hear in our in our Investor meeting later today that we're doing all kinds of things related to what people think of digital the online.
Capture digital from this side, but theres so much opportunity at retail that is basically being neglected by so many folks and retail is not shrinking retail is growing dramatically will show. Some numbers later today that just shows how big that's getting and growing faster than the GDP remittance.
<unk> to Latin America at retail over the last several years.
And we believe that that omni channel approach being able to offer the consumer in every way to send money from here and every way to receive it fair is the way to do business.
Yes.
Thank you.
Our final question today comes from the line of Timothy Chiodo with Credit Suisse. Please proceed with your question.
Thank you and good morning, everyone.
Thanks for taking the question I wanted to touch on the growth algorithm inquired in the 18% growth at the midpoint. It sounds like the components should be in our new agent location additions, which had been strong.
Also the maturing as Randy mentioned, the recently added locations. So they result in more transactions per location. You also mentioned during the call here that there is a slight increase in transaction size.
It's embedded in the guidance, but not nearly as strong as last year, which is maybe appropriately conservative.
Some of the other factors would be either pricing or mix or new products and digital maybe you could just touch on that overall growth algorithm theres any pieces, there that I might be missing or any of that you would highlight in particular.
Okay.
Well I think I think.
In terms of pure numbers that are going to drive EBITDA today and revenue today, a lot of that is going to come from retail in terms of percentages. We're very excited about our online business, which has been growing.
Over 100% year over year lately.
We're excited about the card as Randy talked about earlier, the payroll card and we're excited about the launch of our new App.
Our new GTR park that will be putting out so all of those will be contributors, but in the early stages, what's really going to drive the business. This year is we're investing more at retail, particularly in the west with more people on the street and there as we've talked about a number of times when we put our retailer up and active.
Get a payback on that in about seven or eight months and so it's a very very lucrative return on investment for us with the folks that we have out and putting up new retailers in ZIP codes, particularly California, Texas and parts of other parts of the west So thats going to be a big contributor you'll see though that all the retailers that you put up in <unk>.
<unk> thousand 21 are going to be big contributors, even though it comes out of same store sales in 2022, because they're part of 2022 same store because the second years, where our retailers really grow quite a bit and they also grow quite a bit in the third year. So some of that will be coming from same store some of that will be coming from the new store in the retailers we're adding.
And that combined will drive the biggest uptick in revenue and EBITDA for 2022 will be the retail side.
Excellent. Thank you so much for taking the question.
Randy Let me just add one more component I think maybe this is where you were headed as well.
Pay side of the business with the partners that we work with in Mexico, Guatemala, etc. As our volumes increase year over year. It gives us the opportunity to negotiate better fees with each of those partners. So this year as we see our money transfer business increase with those PE partners, we will see that fees that.
We pay them come down slightly which of course that savings drops right to the bottom line.
That's another component.
Yes.
Excellent. Thank you.
Okay. Thanks.
Thank you we've reached the end of the question and answer session and I will turn the call over to Bob Lissy for closing remarks.
Well. Thank you again, all for joining we hope to see some of you either on person or watching on video our Investor Conference later today.
We look forward to continued great results, we're very optimistic about the business that's been a great year.
When you look at the last two years during Covid and just the when you look at some of those numbers released and just how the business has grown from 19 to 21, it's really astronomical considering the pandemic that had been going on and when you look at some of the larger public companies in our space and how they've contracted during that same period of time.
And we believe that we've got the ability to continue to do that even as times get a little better. This year. So we're looking forward to great results and we hope to talk to you. All soon thank you for your time and attention today.
Thank you. This concludes today's conference you may disconnect. Your lines at this time. Thank you for your participation.
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