Q4 2023 International Money Express Inc Earnings Call

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Operator: Good day and welcome to the International Money Express conference call. All participants will be in a listen-only mode.

Good day, and well covered today International money Express conference call all participants will be in a listen only mode should you need assistance. Please.

Operator: Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press the star then 1 on your telephone keypad. To withdraw your question, please press the star then 2.

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After todays presentation, there will be an opportunity to black wax crude.

Good question you May Press Star then one on your telephone keypad to withdraw your question re Frac are against you. What is the reason that is being recorded.

Operator: Please note this event is being recorded. I would now like to turn the conference over to Alex Sadovsky, Investor Relations Coordinator. Please go ahead, sir.

I'd now like to turn the call over to Alex adopt Investor Relations for Greater <unk> go ahead Sir.

Alex Sadovsky: Good morning and welcome to our quarterly earnings call. I would like to remind everyone that today's call includes forward looking statements, including our 2020 for guidance and actual results and differ materially from expectation. For additional information on International Money Express, which we refer to as Intermex 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.

Good morning, and welcome to our quarterly earnings call.

I'd like to remind everyone that today's call includes forward looking statements, including our 2020 for guidance and actual results may differ materially from expectations for additional information on international money Express.

We've referred to as <unk> for the company. Please see our SEC filings, including the risk factors described there right.

All forward looking statements on this call are based on assumptions and beliefs as of today.

Hey.

You should not rely on our forward looking statements as predictions of future events.

Alex Sadovsky: 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 discuss certain non-GAAP financial measures. Information required by Regulation G under the Securities and Exchange Act for 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 GAAP measure. These can be obtained in the investors section of our website at intermexonline.com. Presenting on today's call is our Chairman, Chief Executive Officer and President, Bob Lissy, and Chief Financial Officer, Andrus Bendy. Also on the call today are Chris Hunt, Chief Operating Officer, Joseph Aguilar, President, Latin America, Randy Nelson, EVP of Retail Sales, Marcelo Theodoro, Chief Digital Officer, Beth Erickson, Chief Human Resources Officer, Andrew Kube, EVP, Finance and Business Intelligence, and Kareem Boroni, Director of Financial Analysis. Let me now turn the call over to Bob. Good morning.

Please refer to slide two of our presentation for a description of certain forward looking.

The company undertakes no obligation to update such information, except as required by applicable law.

On this conference call, we discuss certain non-GAAP financial measures.

Information required by regulation G. Under the Securities Exchange Act for such non-GAAP financial measures is included in our presentation slides our earnings press release, and our annual report on form 10.

Okay.

Including reconciliation of certain non-GAAP financial measures.

Appropriate GAAP measures.

It can be obtained in the investors section of our website <unk> com.

Presenting on today's call is our chairman and Chief Executive Officer, and President of Alessi.

And Chief Financial Officer, Andrew.

Also on the call today are Chris Hall, Chief Operating Officer, Joseph Aguilar, President Latin America, Brandon Nelson EVP of retail sale are selling Theodora Chief Digital officer, both Ericsson.

Eric.

Human resources Officer.

Andrew two Bay, EVP finance and business intelligence.

Greenborough director of financial.

Let me now I'll turn the call over to Bob.

Good morning.

Bob Lissy: Numrex is proud to announce fourth quarter earnings that are a testament to who we are as a company. On page three, you can see that in the quarter we delivered revenue of just under $172 million, up 11.2% year-over-year, and diluted GAAP EPS of 49 cents, up 40% year-over-year. Furthermore, Adjusted ETA was up 14.5% to $33.3 million and Adjusted Diluted EPS up 21.7% to 56 cents.

It makes us proud to announce fourth quarter earnings that are a testament to truly are as a company.

<unk> three you can see that in the quarter, we delivered revenue of just under $172 million up 11, 2% year over year.

Diluted GAAP EPS of <unk> 49 or 40.

40% year over year.

Furthermore, adjusted EBITDA was up 14, 5% to $33 $3 million and adjusted diluted EPS up 21, 7% to 56 cents.

Bob Lissy: We continue to deliver solid earnings and cash generation for our shareholders in every environment, and our fourth quarter results fully demonstrate that. We believe our omni-channel strategy is the most efficient way to serve the varying needs of the consumer in this market. Intermex continues to offer our best-in-class service and loyalty offerings through both our retail and our digital products. This is an advantage that no other provider can claim. A retail network required years of careful precision effort to build and as a result is very difficult to replicate.

We continued to deliver solid earnings and cash generation for our shareholders in every environment and our fourth quarter results clearly demonstrate that.

We believe our Omnichannel strategy is most efficient way to serve the various needs of the consumer in this market Intermix continues to offer a best in class service and loyalty offerings for both our retail and our digital product.

This is an advantage that no other provider can claim.

Retail network required years of careful precision effort to build and as a result, its very difficult to replicate.

Bob Lissy: Our technological advantage makes transacting fast and convenient for both digital and retail consumers. These critical factors have made our model highly profitable and drives exceptional generation of cash. How we deliver our products and service to the market is even more important. At retail, Intermex has taken and will continue to take a highly refined rifle shot approach while building our network of retail agents.

The logical advantage makes transact them fast and convenient for both digital and retail consumers.

These critical factors that made our model highly profitable and drive substantial generation of cash.

How we deliver our products and services the market is even more important.

At retail Intermix has taken and will continue to take a highly refined rifle shot approach while building our network of retail agents.

Bob Lissy: The strategy enabled the company to deliver products and services to consumers through the highest performing retail agent network in the industry. All this occurs while maximizing agent retail performance that drives ROI and profitability. We're most interested in connecting with consumers in markets where our value-added approach resonates the strongest. This is when and where Intermex is able to best differentiate our value-added service, where we can in turn tax the margin, and where we ultimately benefit our shareholders. A retail model requires a modest investment.

Our strategy enabled the company to deliver products and services to consumers through the highest performing retail agent network in the industry.

All of this occurs while maximizing each in retail performance that drives ROI and profitability.

We're most interested in connecting with consumers and markets, where our value added approach resonates the strongest.

This is one and we're intermix is able to best differentiate our value added service or we can't insure and capture margin and where we ultimately benefit our shareholders. Our retail model requires a modest investment.

Bob Lissy: Our sales and marketing costs are roughly 8% of gross margin and only 3% of total revenue. In our digital offering, we continue to demonstrate that same focus on efficiency and profitability while growing our transactions 43% this quarter, and doing that by way of a highly efficient customer acquisition spend. As a result, we're delivering a highly attractive margin. Finally, we continue to develop and introduce new features and functionality to deliver a user experience that is among the best in class. We continue to upgrade our application and it has received a rating of 4.8 out of 5 from our users.

Our sales and marketing costs are roughly 8% of gross margin and only 3% of total revenues.

And our digital offering we continued to demonstrate that same focus on efficiency and profitability, while growing our transactions, 43% this quarter and doing that by way of a highly efficient customer acquisition spend.

As a result, we are delivering highly attractive margin.

Finally, we continued to develop and introduce new features and functionality to deliver a user experience that is among the best in class.

We continue to upgrade our application and that has received a rating of 4.8 out of five from our users.

Bob Lissy: Our spanning margins related to our digital product place us in a great position to expand in new markets, including India, the Philippines, and others, through our new partnership with Visa. In the broader market, significant amounts of capital have been spent by some providers to grow digital market share. In many cases, spending may not have achieved an ROI that would support that investment.

Our expanding margins related to our digital product place us in a great position to expand to new markets, including India, the Philippines, and others through our new partnership with visa.

The broader market significant amounts of capital had been spent by some providers to grow digital market share.

Many cases spanning may not have achieved an ROI that would support that investment.

Bob Lissy: Our strategy is to carefully cultivate and grow our digital business with the same efficiency that we have demonstrated while building our retail network. That is one key reason why our current digital business is profitable and growing. We're taking the approach that no one else in the industry has taken by offering a value-added product and carefully crafted strategy to capture share in the right market. As we do with our retail business, we will leverage our best in class customer service, and our metrical orientation to drive profitable fire growth. This translates into consistent product expansion, strong margins, exceptional cash generation, and a fortress of balance. As we talked about previously, the La Nationale acquisition we closed in Q4 of 2023 brings Intermec's meaningful presence in the U.S. to Dominican Republic market.

Our strategy is to carefully call today and grow our digital business with the same efficiency that we have demonstrated one building our retail network.

That is one key reason why our current digital business is profitable and growing.

We're taking the approach that no one else in the industry has taken our offering of value added products and carefully crafted strategy to capture share in the right markets.

As we do with our retail business, we will leverage our best in class customer service.

Mexico orientation to drive profitable growth this translates into consistent product expansion strong margins exceptional cash generation and a fortress balance sheet.

As we've talked about previously well the national acquisition, we closed in Q4 of 2023 brings intermix meaningful presence in the U S to Dominican Republic market with that acquisition on board for over 12 months, you will see on page five we have recast our market share calculation over time to include the D. R.

Bob Lissy: With that acquisition on board for over 12 months, you will see on page 5 we have recast our market share calculation over time to include the DR. In 2023, we captured a 21.4% share of the top five markets to Latin America. We have successfully grown our market share over time while sustaining attractive margins year after year, are Q4 in the DA margins, excluding acquisitions, were well north of 20%, some of the best we have seen in the history of the company. We have been able to attain these outside results through the execution of our metrically driven strategy. We have a highly efficient base of retail agents who rely on our products and services. We offer and deliver these products to the customer base who appreciates Intermex's value-added approach. We continue to strengthen our relationship with our retail agents while deepening our competitive mode and growing our mutually beneficial high margin business. Additionally, we have the ability to carefully select where and when to aggressively pursue wires at reduced gross margin.

In 2023, we captured a 21, 4% share of the top five markets to Latin America.

We have successfully grown our market share over time, while sustaining attractive margins year after year.

Our Q4, EBITDA margins, excluding acquisitions were well north of 20% some of the best we've seen in the history of the company.

We have been able to attain these outside results through the execution of our metrically driven strategy.

We have a highly efficient base of retail agents, who rely on our products and services, we offer and deliver these products to the customer base appreciates intermixed with value added approach.

We continued to strengthen our relationship with our retail agents, while deepening our competitive mode and growing our mutually beneficial high margin business.

Additionally, we have the ability to carefully select where and when to aggressively pursue wires and reduced gross margins.

Practice is put in place when meaningful incremental transactions can be captured in areas, where internet is a low market share in the upside potential is quite large.

This approach enables us to capture new business in such a way that we do not affect margins at our current high profit retailers.

As a result, we're able to generate incremental earnings for our shareholders.

Bob Lissy: This practice is put in place when meaningful incremental transactions can be captured in areas where Intermax has a low market share and the upside potential is quite large. This approach enables us to capture new business in such a way that we do not affect margins at our current high profit retailers. As a result, we're able to generate incremental earnings for our shareholders. We refrain from reacting to market pressures with a broad-brush approach that degrades margins for the company. Our approach is simple, but not easy.

We refrain from reacting to market crushers with a broad brush approach to degrade margins for the company. Our approach is simple, but not easy it requires focus and disciplined execution.

These behaviors are in our corporate DNA, but they're very difficult to replicate.

And our cost for new business and to catalyze incremental growth, we have launched old strategies to penetrate previously untapped and underdeveloped markets.

Our focus sharpen some locales rife with untapped wire potential E tail to the ZIP code, where our presence has been minimal.

As a part of our aggressive approach to drive revenue in high potential areas, we've decided to expand our outside sales force by adding six new positions to our already robust team of 40.

Bob Lissy: It requires focus and discipline execution. These behaviors are in our corporate DNA, but are very difficult to replicate. In our quest for new business and to catalyze incremental growth, we have launched bold strategies to penetrate previously untapped and underdeveloped markets. Our focus sharpens on locales rife with untapped wire potential detailed to the zip code where our presence has been minimal. As a part of our aggressive approach to drive revenue in high potential areas, we've decided to expand our outside sales force by adding six new positions to our already robust team of 40. This expansion is a press strategy designed to intensify our market penetration and coverage. Moreover, we've taken a decisive step by significantly enlarging our inside sales team, a move that marks a departure from traditional methods by tripling the team size from 12 to 36 members and strategically positioning these roles offshore.

This expansion is a press strategy designed to intensify our market penetration and coverage.

Moreover, we have taken a decisive step by significantly enlarging our inside sales team a move that marks a departure from traditional methods by tripling the team size from 12 to 36 members.

And strategically positioning these rolls off shore, where not only enhancing our capacity to engage with our current agents, but also a tripling our daily interactions and cost effective manner.

Strategic enhancement is expected to dramatically boost our same store sales, representing an almost 60% surge in our total sales force capacity.

Considerable investment in our sales infrastructure is an approach we are confident will yield substantial returns over the next 12 to 18 months.

Finally, our aggressive pursuit of growth through innovative staffing strategies.

From an inorganic perspective, we're also making great progress yeah, I transfer business in Europe grew at 17% in Q4.

Continue to expect great things from our European Division, including strong digital opportunity to access in the coming months.

Bob Lissy: We're not only enhancing our capacity to engage with our current agents, but also tripling our daily interactions in cost-effective manner. This strategic enhancement is expected to dramatically boost our same-store sales, representing an almost 60% surge in our total sales force capacity. This considerable investment in our sales infrastructure is an approach we are confident will yield substantial returns over the next 12 to 18 months, signifying our aggressive pursuit of growth through innovative staffing strategies. From an inorganic perspective, we're also making great progress.

Well the national business in the U S is much more profitable and efficient than a year ago. We.

We believe significant opportunities remain to expand to additional corridor through our current agent base to Mexico alone now armed with the Intermix payer network and fee structure, we see potential for millions of dollars of increased margin annually.

We have begun to execute against this plan.

Additionally, there will be more efficiencies to be leverage as the year unfolds. These businesses are proving to be Great addition, scanner Max and we're excited and optimistic about their combined future.

Before I turn the call over to Andrew to go deeper into the numbers a few final thoughts on operating discipline and why we say Q4 was a testament to who we are as a company.

Bob Lissy: The ITransfer business in Europe grew at 17% in Q4. We continue to expect great things from our European division, including strong digital opportunity to access in the coming months. Well, the national business in the U.S. is much more profitable and efficient than a year ago. We believe significant opportunities remain to expand to additional corridors through our current agent base. To Mexico alone, now armed with the Intermex payer network and fee structure, we see potential for millions of dollars of increased margin annually. We have begun to execute against this plan.

But almost all key measures were strong and exceeded market expectations. We face some revenue headwinds in spite of that we persevered and delivered a solid quarter of growth.

We talked about our plan to capture incremental wires in Q3 I'm pleased to report that our efforts are continuing to be productive on the sales team continues to execute on that plan.

At the same time shortly after our Q3 earnings we saw Mexico market growth slow considerably to levels, we've not seen in years.

True Intermix fashion, we put a critical eye on our business and challenge every corner of the company to maximize efficiency. We delivered what we set out to do and generated strong earnings despite a weaker than expected top line.

Bob Lissy: Additionally, there will be more efficiencies to be leveraged as the year unfolds. These businesses are proving to be great additions to Intermex, and we're excited and optimistic about their combined future. Before I turn the call over to Andrews to go deeper into the numbers, a few final thoughts on operating discipline, and why we say Q4 was a testament to who we are as a company. By almost all key measures, we're strong and exceeded market expectations. We faced some revenue headwinds. In spite of that, we persevered and delivered a solid quarter of growth. We talked about our plan to capture incremental wires in Q3. I'm pleased to report that our efforts are continuing to be productive and this sales team continues to execute on that plan. At the same time, shortly after Q3 earnings, we saw Mexico market growth slow considerably to levels we have not seen in years.

While it is difficult to predict one of our key markets will do in 2020 for the guidance Andros, who will take you through later in the presentation anticipates underlying softness in that market for a period of time, our guidance also anticipates, a tenacious focus on efficiency and execution that is part of our culture.

And why we feel better positioned than anybody else in the market.

We are confident in our Differentiators and the management team and the board feel there is tremendous value in the Internet stock.

We will continue to be highly profitable and produce considerable free cash in spite of the investments, we're making in our future growth.

And finally, we will use a share of that free cash to increase our stock buyback program, we anticipate being twice as active on our existing program. It will continue to assess block trades that benefit our shareholders with that I'll turn the call over to Anders.

Thanks, Bob and good morning, everyone on slide six you can see both unique customers and transactions.

Digits year over year. Most importantly, we grew this business at healthy margins, which you'll see reflected in the coming pages.

Bob Lissy: In true Intermex fashion, we put a critical eye on our business and challenge every corner of the company to maximize efficiency. We delivered on what we set out to do and generated strong earnings despite a weaker than expected top line. While it is difficult to predict what our key markets will do in 2024, the guidance Andris will take you through later in the presentation anticipates underlying softness in that market for a period of time. Our guidance also anticipates a tenacious focus on efficiency and execution that is part of our culture and why we feel better positioned than anybody else in the market. We're confident in our differentiators and the management team and the board feel there is tremendous value in InterMet stock.

On slide seven the strong trend in profitable digital growth continued transactions were up 42% at the best margins, we've seen for our digital product, we're confident in our product our digital partnerships and a team that's bringing to the market also worth mentioning is the growth on the digital receive side those transactions terminating by elect.

Chronic methods like bank accounts mobile wallets et cetera are a key factor and that almost 18% year over year, you can see to the right.

These transactions are typically very cost efficient ways for us to deliver a wire. So this trend is also a nice margin tailwind for us.

On slide eight we present, a picture of our volume growth in average principal said.

On face value. It appears that the average principal was down year over year to $406. A transaction in Q4 that is mostly driven by the inclusion of blood I see now and I transfer where they send amounts are structurally lower principal amounts excluding those business were essentially flat for the quarter.

Bob Lissy: We will continue to be highly profitable and produce considerable free cash in spite of the investments we are making in our future growth. And finally, we will use a share of that free cash to increase our stock buyback program. We anticipate being twice as active in our existing program and will continue to assess block trades that benefit our shareholders. With that, I'll turn the call over to Andrew. Thanks, Bob. Good morning, everyone.

On the next page you can see revenue growth up 11, 2% for the quarter and 25% for the year as Bob mentioned earlier revenue was at the lower end of our guidance as we were not immune to the slowdown in Mexico. However, as you see next on page 10, our strategy to grow transactions in the core while preserving margins.

With our rigorous cost agenda.

<unk> earnings results.

See that Didnt come up almost 34% for the quarter and diluted EPS up 40%.

Andrus Bendy: On slide six, you can see both unique customers and transactions up double digits year over year. Most importantly, we grew this business at healthy margins, which you'll see reflected in the coming pages. On slide 7, strong trend in profitable digital growth continued.

As we close them.

Positioning in Q4 of last year, we're growing over about $2 5 million and transaction costs, which is bolstering the gatineau on the next page you can see a little cleaner reflection, which among others adjust out those transaction costs. Adjusted net income is up 13, 5% and adjusted diluted EPS is up 21, 7%.

Andrus Bendy: Transactions were up 42% at the best margins we've seen for our digital product. We're confident in our product, our digital partnerships, and the team that's bringing it all to market. Also worth mentioning is the growth on the digital receive side. Those transactions terminating by electronic payout methods like bank accounts, mobile wallets, et cetera, are a key factor in that almost 18% year over year growth you can see to the right. These transactions are typically very cost efficient ways for us to deliver wire.

Finishing up the P&L adjusted EBITDA grew at 14, 5% in the quarter with adjusted EBITDA margins at 19, 4% versus 18, 8% in the prior year. So again, our targeted strategy to grow wires in this environment without degrading margins is delivering for shareholders also worth it to know.

Q4, 23 includes a full three months well below NAV.

Transfer, both structurally lower margin businesses and our year over year margins still improved by 60 basis points, a testament to our focus to deliver a premium product.

Wiley tactical execution.

Andrus Bendy: So this trend is also a nice margin tailwind for us. On slide eight, we present a picture of our volume growth and average principal cent. On face value, it appears that the average principal is down year over year to $406 a transaction in Q4. That is mostly driven by the inclusion of La Nacionale and iTransfer, where the send amounts are structurally lower. Principal amounts excluding those businesses were essentially flat for the quarter.

Finally on cash in the balance sheet, we ended up the quarter on a Sunday or a holiday weekend with $239 million on the balance sheet and 106 million of Undrawn revolver capacity free cash generated which again removes day of the week cyclicality was up 26% year over year.

The balance sheet remains in great shape.

While the headline shows us about one six times Levered, we have to remember that we closed on a weekend with $114 million drawn on the revolver and most days of the week that revolver since completely undrawn.

Andrus Bendy: On the next page, you can see revenue growth up 11.2% for the quarter and 20.5% for the year. As Bob mentioned earlier, revenue was at the lower end of our guidance as we were not immune to the slowdown incentive in Mexico. However, as you see next on page 10, our strategy to grow transactions in the core while preserving margins coupled with a rigorous cost agenda yielded strong earnings results. You can see net income up almost 34% for the quarter and debt-loaded EPS up 40%. As we closed on the national acquisition in Q4 last year, we're going over about $2.5 million in transaction costs, which is bolstering the GAAP number. On the next page, you can see a little cleaner reflection, which, among others, adjusts out those transaction costs.

Look at our average daily debt position for 2023 versus our adjusted EBITDA for all of 2023 it implies a leverage of below one times.

As far as capital allocation goes at the top of the list are aggressive incentives at retail that deliver a highly accretive transaction and margin growth.

After that we'd continue to see value in the stock in the quarter, we purchased about 25 million in stock 10 million by our regular quarterly program had another $15 million through block purchases as Bob mentioned earlier, we expect to double our quarterly underlying program from 10 million to $20 million and we'll continue to make block purchases when and where it makes.

For our shareholders.

Far as M&A goes we're always going to look for opportunities, especially with the balance sheet. We have however, we're going to continue to be selective stewards of the company's capital resources exercising a prudent approach with robust screens for value.

On the final slide I'll take you briefly through our guidance for 2024 and for the first quarter for.

Andrus Bendy: Adjusted net income is up 13.5%, and adjusted diluted ETS is up 21.7%. Finishing up the P&L, Adjusted EBITDA grew at 14.5% in the quarter with Adjusted EBITDA margins at 19.4% versus 18.8% in the prior year. So again, our targeted strategy to grow wires in this environment without degrading margins is delivering for shareholders. Also worth it to note, Q4'23 includes a full three months of Linastin-Allanite transfer, both structurally lower margin businesses, yet our year-over-year margin is still improved by 60 basis points, a testament to our focus to deliver a premium product through highly tactical execution. Finally, on Cash on the Balance Sheet, we ended up the quarter on a Sunday of a holiday weekend with $239 million on the balance sheet and $106 million undrawn revolver capacity. Free cash generated, which again, removes Day of the Week cyclicality, was up 26% year over year. The balance sheet remains in great shape. While the headline shows us about 1.6 times levered, we have to remember that we closed on a weekend with $114 million drawn on the revolver. And most days of the week, that revolver sits completely undrawn.

For the full year 'twenty 'twenty four we anticipate the following revenue of 681 to $701 8 million.

Fully diluted GAAP EPS of $1 81 to $1.96.

Adjusted EBITDA 124 to $127 7 million.

Adjusted diluted EPS of $2 13 to $2 31.

For the first quarter, we anticipate the following revenue of 154 million to $155 million.

Diluted GAAP EPS of <unk> 32 cents for 35 cents.

Adjusted EBITDA of $24 4 million to $25 1 million.

Adjusted diluted EPS of <unk> 39 to 42 cents.

This guidance takes into account a noteworthy step down in market growth for Mexico to key corridor in Latin America, while we're not immune to the effects of growth slowing at the single largest country to country corridor in the world, We anticipate four things.

We will continue to beat the market growth rate in both retail and digital.

Our margins will remain strong justified by premium product is highly tactical execution.

The pivot to an even leaner operating model maximizing returns in the face of a market, whose pace of growth has come back down to Earth.

And finally, we will utilize our strong liquidity and ability to generate cash to more aggressively pursue shares by our buyback.

In summary, we continue executing the interest playbook and are well positioned to deliver another strong year for our shareholders with that I'll turn it over to the operator for questions.

Thank you, we'll now begin the question and answer session to ask a question you May press Star one on your telephone keypad. If you are using a speaker phone. Please pick up your handset before pressing the keys.

Andrus Bendy: If we look at our average daily debt position for 2023 versus our adjusted EBITDA for all of 2023, it implies a leverage of below one time. As far as capital allocation goes, at the top of the list are aggressive incentives at retail that deliver highly accretive transaction and margin growth. After that, we continue to see great value in the stock. In the quarter, we purchased about $25 million in stock, $10 million via our regular quarterly program, and another $15 million through block purchases.

Any time your question has being address do you mean.

We do all your question pressing star two.

Our first question comes from David Scharf with she deserves J M. B. Please proceed.

Great Good morning, and thanks for taking my questions.

Bob could you provide a little more.

I.

I guess background and geographic context for.

The sales force expansion since it's such a dramatic increase.

Andrus Bendy: As Bob mentioned earlier, we expect to double our quarterly underlying program from $10 million to $20 million, and we'll continue to make block purchases when and where it makes sense for our shareholders. As far as M&A goes, we're always going to look for opportunity, especially with the balance sheet we have. However, we're going to continue to be selective stewards of the company's capital resources, exercising a prudent approach with robust screens for value.

Particularly the internal team.

It is this bolstering up efforts in the western regions ZIP codes I know you've long been targeting or I thought you said something about offshore can you just provide some more background on kind of how we ought to be sure. It's in a broader kind of multiyear context of kind of what you think your footprint will look like.

Yes, we the insight team has been primarily located in Miami with a few folks out in California to be more productive relative to time zones, and we had 12 folks that were directly responsible for contacting agents by telephone or those are separate and.

Apart, but supporting our efforts at retail with our outside sales team, we recognize that our reach.

Andrus Bendy: On the final slide, I'll take you briefly through our guidance for 2024 and for the first quarter. For the full year 2024, we anticipate the following revenue of $681 to $701.8 million. Fully Diluted Gap EPS of $1.81 to $1.96, adjusted even dot 124 to 127.7 million, adjusted by the EPS of $2.13 to $2.31. For the first quarter, we anticipate the following revenue of $150.4 million to $155 million, fully diluted gap EPS of 32 cents to 35 cents, adjusted EBITDA of $24.4 million to $25.1 million, and adjusted diluted EPS at $0.39 to $0.42.

It could be benefited by having more folks available and what we did is created 24 positions in Guatemala.

People that are fully bilingual that.

We'll be augmenting those 12 folks and then working teams of three people wanted to U S. Two in Guatemala, and will have a set of agents approximately 12 different teams. So each team will have about 112th of our existing agents and what they'll be doing is calling those agents and looking at opportunities where we might have a.

Winding wires, where it's a slow start up with the new agent. Our experiences is that contact drives many more wires and the payback is really even good if the U S team, but the fact that it's much more efficient cost wise to do this in Guatemala, we're able to triple our reach from the inside perspective without.

Anywhere near tripling the cost of that function now edition of the that we've had 40 district sales managers in the U S that have been.

Separating our accounting for our existing business and going out after new business those will be augmented by a 15% increase so we've tripled the size of the inside and then a 15% increase other folks out there in the U S. At retail that will be visiting our existing agents will have the primary responsibility.

Operator: This guidance takes into account a noteworthy step down in market growth for Mexico, the key corridor in Latin America. While we're not immune to the effects of growth slowing at the single largest country-to-country corridor in the world, we anticipate four things, will continue to beat the market growth rate in both retail and digital. Our margins will remain strong, justified by a premium product and highly tactical execution, will pivot to an even leaner operating model, maximizing returns in the face of a market whose pace of growth has come back down to earth. And finally, we'll utilize our strong liquidity and ability to generate cash to more aggressively pursue shares by our buyback program. In summary, we continue executing the Intermax Playbook and are well-positioned to deliver another strong year for our shareholders. With that, I'll turn it over to the operator for questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the key.

We're adding new agents in the vacant Sip codes, where we have opportunities. We've coupled this with a approach that is looking at different offerings that will be more attractive to both the agent and.

And to the consumer.

In certain Zip codes, where today, we havent penetrated and as we talked about and signaled in the text that please.

These are opportunities, where we're not giving away any margin, where even if we're taking a lower margin and be more aggressive. It's all found transactions because we have not penetrated those zip codes in the past. So it represents a total remake of what we're doing from an aggressive perspective in the west, but also a remake relative to supporting our existing.

<unk> base and becoming more aggressive at retail so.

We think that it will pay large dividends in the next 12 to 24 months and we'll have we'll see an extension of our rate of growth of further separation from our rate of growth over the market rate of growth in that period of time.

Got it understood maybe in it and as a follow up.

Along that sort of increasing the internal.

Sales force focus on monitoring existing agents.

It looks like a lot of the.

Forward guidance is impacted by what you're witnessing in Mexico, I mean, notwithstanding some of the movement in.

David Stark: If at any time your question has been addressed, you may... Withdraw your question, pressing star 2. Our first question comes from David Stark with Cheetah Viz, JMP, please proceed. Great morning and, Bob, can you provide a little more? background and geographic.

Some of the Banco de Mexico data.

I know kind of one of the largest.

The largest global player I know when their their call had mentioned they had returned to gaining share in Mexico. After a long time.

And you've talked about pricing pressures in that corridor and in past calls is there.

Bob Lissy: Rayna Kumar, Joseph Foresi, Rayna Kumar, Sloan Bohlen, Int Money, this full string up. Fudge, kind of how we ought to view this in a broader, kind of multi-year context. & Co. Yes, we the inside team has been primarily located in Miami with a few folks out in California, to be more productive relative to time zones. And we had 12 folks that were directly responsible for contacting agents by telephone. Those were separate and apart but supporting our efforts at retail with our outside sales. We recognized that our reach could be benefited by having more folks available. And what we did is created 24 positions in Guatemala, with people that are fully bilingual, that will be augmenting those 12 folks, and they'll work in teams of three people, one in the U.S., two in Guatemala, that will have a set of agents, approximately 12 different teams.

Are you do you feel like you're maintaining share.

In the U S to Mexico, it sort of your mature agents I mean, we think there are two things going on we think we're gaining share at retail and we're gaining share of digital C.

The challenge for US is today, our business is not weighted the same way as the market. So we're not having 20% of our business to Mexico go digital and that's the faster growth piece of the business I think we we believe we're growing just as well as the digital pieces and just as well as the REIT.

Pieces, but our percentages are more like 95% retail today and 5% digital so that that weighting causes our growth to maybe look not as good as it does we think again, we're beating and exceeding at retail and beating and exceeding a digital and we think this program, where we're adding not only adds.

The folks to target.

But also the fact that we will be.

Bob Lissy: So each team will have about 1 12th of our existing agents. And what they'll be doing is calling those agents and looking at opportunities where we might have a decline in wires, where it's a slow startup with a new agent. Our experience is that contact drives many more wires, and the payback is really even good if the U.S. team, but the fact that it's much more efficient cost-wise to do this in Guatemala, we're able to triple our reach from the inside perspective without anywhere near tripling the cost of that function.

Taking a look at what were willing to offer the agent and the consumer at retail in these underserved or unserved areas, it's going to make a lot of difference and well make a sort of a further separation between us and market share.

Also in the in the Bronx growth, which will gain further market share for us.

Understood.

Just a quick quick follow up for address I guess.

Salary benefit you know the largest opex. After you know agent charges I guess, it was 72 million last year or there may be somewhat lower.

Bob Lissy: Now, additional to that, we've had 40 district sales managers in the U.S. that have been separating or accounting for our existing business and going out after a new business. Those will be augmented by a 15% increase. So we've tripled the size of the inside, and then a 15% increase of the folks out there in the U.S. at retail that will be visiting our existing agents, we'll have the primary responsibility for adding new agents in the vacant zip codes where we have opportunities. We've coupled this with a approach that is looking at different offerings that will be more attractive to both the agent, and to the consumer in certain zip codes where today we haven't penetrated and as we talked about and signaled in the text that, These are opportunities where we're not giving away any margin, where even if we're taking a lower margin to be more aggressive, it's all found transactions because we have not penetrated those zip codes in the past.

ICL noise.

But as we think about the increase in sales head count I don't know if it's all variable and commission based.

Is there a.

Kind of a good figure we ought to think about for an annualized figure in salary and benefit this year. It seems like that would be the line item moving the most.

Yeah, I think it's it's relatively small these additions I mean, we are in terms of our salary movement year over year.

Youre going to see in aggregate for the business, 4% to 5%. So we've really dialed back on that.

So that impact of these ads is relatively small and taking into account all the other areas, where we're dialing back cost as much as we can you know, it's not really going to push through them to be a visible impact.

Got it great. Thanks, so much.

Yes.

Our next question comes from Mike Grondahl with Northland Securities.

Hey, good morning, guys.

Bob Lissy: So it represents a total remake of what we're doing from an aggressive perspective in the West, but also a remake relative to supporting our existing base and becoming more aggressive at retail. So we think that it'll pay large dividends in the next 12 to 24 months, and we'll see an ascension of our rate of growth, a further separation from our rate of growth over the market rate of growth in that period of time. Got it, understood. Maybe as a follow-up along that thought of...

Did you guys call out.

The revenue number from line as you know and I transfers I'm trying to just back into an organic growth rate for Q.

Yeah, sure, Mike because where we're all on the main call together rationale.

<unk> in Q4, it was about $18 million I transfer in Q4 was about five.

Which means your organic growth in the core was about little under five 5%.

Got it.

Then.

Last quarter, you guys kind of talked about I'll call. It four.

Andrus Bendy: Sales. H, you know it looks like a lot of, Forward Guide. Richard Witt, I mean, notwithstanding.

You know growth drivers that you were sort of strategically heading towards or implementing you know one was sort of targeted counter offers.

Bob Lissy: Mexico data. I know kind of one of the largest, the largest global player, I know, on their call it, talked about pricing pressures in that corridor in past calls. Are you, do you feel like you're maintaining share and, U.S. to Mexico. Yeah, I mean, we think there are two things going on.

One was new agent.

One was some overall selected pricing actions and and I think kind of new market strategies.

Could you handicap like.

Which one of those four you're ahead on maybe which ones you're kind of behind on just let us know how each of those four are going.

Yeah, I think so.

Bob Lissy: We think we're gaining share at retail, and we're gaining share at digital. The challenge for us is today our business is not weighted the same way as the market. So we're not having 20% of our business to Mexico go digital.

The most important and the one that we're doing the best and as the targeted offerings. So that's what we mentioned in the in the in the text was that that program is growing quite well and we've executed well against it.

Brought in tens of thousands of wires on that program, which were essentially.

Bob Lissy: And that's the faster growth piece of the business. I think we believe we're growing just as well as the digital pieces and just as well as the retail pieces, but our percentages are more like 95% retail today and 5% digital. So that weighting causes our growth to maybe look not as good as it does.

Turning a little bit of commission upfront, let's say to an agent and then we're reducing the amount of payment that the agent gets over time. So it doesn't have a huge impact on our commission.

That the agent gets or our gross margin over time, but it's more of an upfront payment to bring back wires that we haven't had in the past that has done quite well and I think we are executing and continuing to execute against that.

Bob Lissy: We think, again, we're beating and exceeding at retail and beating and exceeding at digital. And we think this program where we're adding, not only adding the folks to target, but also the fact that we'll be taking a look at what we're willing to offer the agent and the consumer at retail in these underserved or unserved areas is going to make a lot of difference and will make a further separation between us and market share. I'll sit in the market growth, which will gain further market share for us. Steve, and I thought just a quick follow-up for Andres, I guess.

The second one with new agents.

We continue to drive growth through our new agents, and that's going well as well we.

Targeting that growth in specific ZIP codes is the thing that we're going to spend more time on and that will be sort of a targeted along with new agents, which will be this sort of new price offering where we'll be a little bit more aggressive with both the agent and the consumer but again I want to highlight and make sure I underscore that that does not mean.

We're going to you know where we have.

Plus million wires, and we have it at X margin, we're not going and discounting there we're being aggressive with price, where we're not where we're not getting wires, where we have a small level of market penetration, where we might not be serving in the ZIP code at all and we feel both of those strategies are going well the overall actually our overall approach to the market is.

Andrus Bendy: Salary, just stop back, chart, but, That's all. Yeah, I think it's relatively small, these additions. I mean, we have, in terms of our salary movement year over year, you know, you're gonna see an aggregate for the business, four to 5%, so we've really dialed back on that. So that impact of these ads is relatively small and taking into account all the other areas where we're dialing back costs as much as we can, you know, it's not really gonna push through to be a visible impact. Thanks so much.

Ben better margins, we watch the pricing component into finance and Andrew <unk>, who said who's the head of the sales planning and analysis has been running the pricing and we've actually done much better in terms of margins versus the margins that a year ago and that's been done.

Because we've done less of a sort of wholesale changes in the market and more specific changes related to when we get wires as as a as a benefit of moving price new markets I'm not sure what that piece was I think you know we.

Michael Grondahl: Our next question comes from Mike Grondahl with Northland. Hey, good morning, guys. Would you guys call on me? the revenue number from La Nationale and I-Transfers. I'm trying to just back into an organic growth. Yeah, sure, Mike, because we're all on the main call together. La Chanel.

We have Canada, we certainly have the growth in inland nationality, let me touch on international for a minute, we think my nationality.

Andrus Bendy: Ilan Asinale in Q4 was about $18 million, I transferred in Q4 was about $5 million, which means your organic growth in the core was about a little under 5.5%. Got it, and then. Last quarter, you guys kind of talked about, I'll call it four.., you know, growth drivers that you were sort of. You know, one was sort of targeted, counter offers. One was new agent. One was some. Overall Selected Pricing, and I think kind of new market strategy. Could you handicap like.., which one of those four you're ahead on, maybe which ones you're kind of behind on.

Got a lot of pent up growth in that it became really a Dominican Republic products.

And we've now given them the payer relationships, we have in Mexico, and our payer cost to Mexico, and we've already seen an uptick in those wires theres a lot more to do there is a lot more of putting them on our payer network and a lot of volume of transactions and their retail network, both the company stores and the retail.

Millers that have not been tapped in the past because the national was focused primarily on the Dominican Republic. So we still see a lot of growth opportunity. There and then Additionally, Europe has been growing well, we think there's a lot more opportunity in Italy, we think.

Bob Lissy: Just let us know how each of those four are going. Yeah, I think, The most important and the one that we're doing the best in is the targeted offerings. So that's what we mentioned in the in the in the text was that that program is going quite well, and we've executed well against it. We brought in tens of thousands of wires on that program, which were essentially paying a little bit of commission up front, let's say, to an agent. And then we're reducing the amount of payment that the agent gets over time.

We're looking at things in other parts of Europe as well. So those are the new markets where growth will come from.

Got it.

In terms of the buyback did did I hear correctly, you guys had been kind of programmatically buying at $10 million a quarter.

Starting 124, that's gonna uptick to 20 million a quarter.

That's right, Mike and will also be active in terms of our block purchases, if theyre going to benefit the shareholder as well, but we feel that will have an underlying 20 million that will be able to pick up each quarter.

Bob Lissy: So it doesn't have a huge impact on our commission that the agent gets or a gross margin over time. But it's more of an upfront payment to bring back wires that we haven't had in the past. That has done quite well.

Bob Lissy: And I think we're executing and continue to execute against that. Um, the second one with new agents, we continue to drive growth for our new agents, and that's going well as well. We, we targeting that growth in specific zip codes is the thing that we're gonna spend more time on. And that will be sort of a targeted along with new agents, which will be this sort of new price offering where we'll be a little bit more aggressive with both the agent and the consumer. But again, I wanna highlight and make sure I underscore that that does not mean we're going to, you know, where we have four plus million wires and we have it at X margin. We're not going and discounting there.

But we have some price parameters built into that as well. So it's not at all cost, but you know I feel pretty good about being able to pick up 20 million worth of quarter, and then blocks on top of that.

Got it and just lastly.

Are you able to put.

Like a revenue range or.

In terms of growth.

What Mexico is acting as a headwind for 'twenty for like five points of revenue growth four points seven points, what do you see that headwind as roughly as compared to like 23.

Yeah, I think you know right now we see that that the Mexico growth in fourth quarter as an industry was only at three 5% and our assumptions in the plan, we presented assumed that kind of growth sustaining itself throughout.

Bob Lissy: We're being aggressive with price where we're not, where we're not getting wires, where we have a small level of market penetration, where we might not be serving in the zip code at all. And we feel both of those strategies are going well. The overall, actually our overall approach to the market has been better margins. We've brought the pricing component into finance and Andrew Kube who's a head of the sales planning and analysis has been running the pricing.

2024, so we're not dependent on that coming back at all if the market starts to come back just to put in perspective in Q2 of 2020, which was the height of Covid. The market grew at three six and in Q4 of 2023 grew 3.5. So it actually grew a 10th of a percent.

Slower than it did during COVID-19 in Q4, and we kind of projected that through 'twenty four.

Bob Lissy: And we've actually done much better in terms of margins versus the margins of the year ago. And that's been done because we've done less of sort of wholesale changes in the market and more specific changes related to when we get wires as a benefit of moving price. New markets, I'm not sure what that piece was. I think, you know, we have Canada, we certainly have the growth in La Nationale. Let me touch on La Nationale for a minute.

Our upside is is these investments that we're making in sales from a growth perspective that are totally been assimilated into our cost structure, because we've done a lot of zero based budgeting as well that's eliminated some I think unjustified or an inefficient costs right that we've now put back into.

The sales per perspective, we think that.

Our target and our aspiration is to separate ourselves further from that growth number, but our assumptions are based on Mexico, staying around three or 4% growth as an industry through 'twenty four.

Bob Lissy: We think La Nationale has got a lot of pent-up growth in that it became really a Dominican Republic product. And we've now given them the pair relationships we have in Mexico and our pair cost to Mexico. And we've already seen an uptick in those wires. There's a lot more to do.

Got it hey, thank.

Thank you.

Well.

Our next question comes from Chris Van <unk> with UBS.

Thanks for taking our question.

My first question is about the visa direct opportunities.

Bob Lissy: There's a lot more of putting them on our pair network and a lot of volume of transactions in their retail network, both the company stores and the retailers that have not been capped in the past because La Nationale was focused primarily on the Dominican Republic. So we still see a lot of growth opportunity there. And then additionally, Europe has been growing well. We think there's a lot more opportunity in Italy.

It's relatively new I understand it's kind of Nathan and you talked about.

<unk>.

That enabling your ticketing two important markets, such as India, and Philippines, and a couple of others to call it out.

The last call and potentially some more this year. So the first part maybe can you talk about a little bit about the potential opportunities and the expansion plans. This year and what are your kind of longer term outlook from the visitor at the partnership and then the second part is how much of that visit.

Bob Lissy: We think, you know, we're looking at things in other parts of Europe as well. So those are the new markets where growth will come from, got it, In terms of the buyback, did I hear correctly, you guys had been.., kind of programmatically buying it $10 million a quarter, starting 1Q24, that's going to uptick to $20 million a quarter. That's right, Mike.

Okay.

Opportunities for our new markets do you have you baked into the.

Planned this year.

Plenty of time for guidance.

Hi, it's Marcelo here I'm going to I'm going to cover the first question. So we see a huge opportunity in this partnership because it makes the company moving from a mood tie a counter multi region our approach to a global approach. So there are important corridor that you are going to embrace like.

Bob Lissy: And we'll also be active in terms of block purchases, if they're going to benefit the shareholder as well. But we feel that we'll have an underlying $20 million that we'll be able to pick up each quarter. You know, we have some price parameters built into that as well. So it's not at all cost.

India, our Philippines as you said those aren't huge markets that we believe we can address a.

At a lower cost and a great experience is more of a national before.

Bob Lissy: But you know, I feel pretty good about being able to pick up $20 million worth of quarter and then blocks on top of that, got it. And just lastly. Are you able to put, like a revenue range, or in terms of growth. What Mexico is acting as a headwind for 24 like, 5 points of revenue growth, 4 points, 7 points. What do you see that head?

We did incorporate the depths to our projections for 'twenty to 'twenty four but of course, it's a increasing number throughout the year due to our current focus on Latin America. So it's a new targa Italians that you'd have to embrace we see some traction already but it's a midterm exercise that we're going step by step.

Andrus Bendy: Roughly, it's compared to like 20. Yeah, I think, you know, right now, we see that that the Mexico growth in fourth quarter, as an industry was only at 3.5%. And our assumptions in the plan we presented, assumed that kind of growth, sustaining itself throughout 2024. So we're not dependent on that coming back at all, if the market starts to come back, just to put in perspective in Q2 of 2020, which was the height of COVID, the market grew at 3.6. And in Q4 of 2023, it grew at 3.5. So it actually grew, you know, a 10th of a percent slower than it did during COVID in Q4. And we kind of projected that through 24.

And I would just jump in Christmas as Andrew said I think the overall contribution that from an overall company perspective is it still quite small what was baked into 'twenty 'twenty. Four you know I think we could see it as an option if it really pops, but right now the contribution from the overall materiality of that plan is quite small at the moment.

Alright, Thanks, a lot yeah.

That's very helpful and the second part I just wanted to.

A little bit about the fourth quarter performance I guess outside of the Mexico market.

<unk>.

Hence you saw in the market.

And I guess, the rest of Latam regions compared to.

What you had expected going into the quarter. Thank you.

I think we've seen the broader market and certainly not only Mexico, but Guatemala and other key countries for us slow down relative to growth not us.

As acutely as Mexico has.

Marcelo Theodoro: Our, our upside is, is these investments that we're making in sales from a growth perspective, that are totally been assimilated into our cost structure, because we've done a lot of zero based budgeting as well, that's eliminated some, I think, unjustified or inefficient costs, right, that we've now put back into the sales perspective, we think that, Our target and our aspiration is to separate ourselves further from that growth number, but our assumptions are based on Mexico staying around 3 or 4% growth as an industry through 24, got it. Hey, thank, Our next question comes from Chris Vang with UBS. Hi, thanks for taking our question. So, my first question is about the Visa Direct opportunities.

But we also see some really strong growth, where we've executed well in certain countries and have at times been very you know on the borderline of triple digit growth countries like Nicaragua, and others, where we have been growing very quickly. So I think the overall market has slowed a bit subdued virtually just about every country in Latin America.

But we've been able to grow well outside the size of the market in certain markets like Nicaragua I believe.

Ecuador, Colombia, we're growing much faster than the market in those areas.

Dominican Republic, we're seeing that there's some slowing in that market. We think that's a market that's moving a little faster to digital Dominican.

People in the U S tend to be more likely bank and is there a more likely bank. They have more options, meaning that they have the option to go to digital easier and more fluid than somebody who's maybe undocumented.

Marcelo Theodoro: It's relatively new, I understand it's kind of Nathan and you talked about, that enabling you to go into imported markets, such as India and Philippines and a couple others to call it out at the last call and potentially some more this year. So the first part, maybe can you talk about a little bit about the potential opportunities and the expansion plans this year and what are your kind of longer term outlook from the Visa Direct partnership? And then the second part is how much of that Visa Direct opportunities or new markets? Do you have you affecting to the plan this year for the 2024 guidance. Hi, it's Marcelo here.

Undocumented.

Member of the <unk>.

Workforce from Mexico, Honduras, Guatemala. So those are those are that's how I would sum up the overall trends.

Alright, that's very helpful I'll jump back to the queue.

Our next question comes from Sam Soundbites, we need patent. Please proceed.

Great. Thanks, Thanks, guys for taking the questions I'm harping on for Mike today.

I was wondering if you guys could provide some insight into some of the pricing dynamics you saw in the fourth quarter I know earlier in the year I think it was in the third quarter you guys mentioned some.

Pricing pressures stemming from competitors. So can you guys just talk about what you saw in the fourth quarter and maybe how you guys are thinking about pricing in 2024.

Yeah, what we saw is that we've actually been able to extend our margins in fourth quarter and increase them by being more efficient and slicing it a little bit thinner.

Marcelo Theodoro: I'm going to cover the first question. So we see a huge opportunity in this partnership because it makes the company move from a multi-country, multi-region approach to a global approach. So there are important corridors that we're going to embrace, like India or Philippines, as you said. Those are huge markets that we believe we can address at a lower cost and a great experience, as Bob mentioned before. We did incorporate that to our projections for 2024, but of course it's increasing number throughout the year due to our current focus on Latin America. So it's a new target audience that we have to embrace. We see some traction already, but it's a midterm exercise that we're going step-by-step. Yeah, and I would just jump in, Chris, this is Andres.

<unk>, we made bigger movements with price related to the whole market and now our price movements are related to places, where there's an incremental upside in terms of wires or we're very careful about is that we don't wanna be discounting, where we have wires in house, where people are perfectly happy with the pricing and those.

Wires are already wires were going to get now as we look at 'twenty four.

A big opportunity for us is <unk>.

Certain areas of the country.

Where there still remains for instance, southwest we have a million.

Foreign borns living in ZIP codes in California that we haven't tapped into at all because our California business is in which its.

Andrus Bendy: I think the overall contribution that, from an overall company perspective, is still quite small, what was baked into 2024. I think we could see it as an option if it really pops, but right now the contribution from the overall materiality of the plan is quite small. All right, thanks a lot to both of you. That's very helpful. And the second part, I just wanted to ask.., a little bit about the four quarter performance, I guess, outside of the Mexico market. What were some of the trends you saw in the market? have the performance in, I guess, the rest of the LACA regions compared to China, what you had expected going into the quarter. Thank you. I think we've seen the broader market, and certainly not only Mexico, but Guatemala and other key countries for us, slow down relative to growth, not as acutely as Mexico has.

Several million wires a year, we havent tapped in those ZIP codes at all we also have another set of ZIP codes that have about $1 7 million people, where we tapped into very slightly and so those are the places where you'll see a different pricing perspective, a different pricing action will be much more aggressive there but that does.

Integrated all our current margins are current margins are going to stay relatively stable those margins will be ones that will come in at a lower gross margin per transaction, but will be incremental transactions. So the overall average might come down a bit but nothing will be done to degrade the core business.

Got it Okay. That's super helpful.

And then just a quick follow up could you guys talk more about some of the momentum you're seeing in the eye transfer business in the knee.

Bob Lissy: But we also see some really strong growth where we've executed well in certain countries and have, at times, been on the borderline of triple-digit growth to countries like Nicaragua and others where we've been growing very quickly. So I think the overall market has slowed a bit to virtually just about every country in Latin America, but we've been able to grow well outside the size of the market in certain markets like Nicaragua, I believe Ecuador, Colombia, we're growing much faster than the market in those areas. Dominican Republic, we're seeing that there's some slowing in that market. We think that's a market that's moving a little faster to digital. Dominican people in the U.S. tend to be more likely banked, and if they're more likely banked, they have more options, meaning that they have the option to go to digital easier and more fluidly than somebody who's maybe an undocumented member of the workforce from Mexico or Honduras or Guatemala.

Expectations are any goals you guys have for the upcoming year.

Yeah.

I'd say that we built a plan that we feel comfortable it can be in the mid teens. If we're operating that business similar to how it's operating today, but a little bit more efficiently I think what we're trying to do is create more of a big Bang plan, which you know if we get off to the right start.

You know, we will be investing quite a bit in the front end I think in the second half of the year, Italy. In particular is a really interesting opportunity I think structurally the margins are better in Italy, and I think you know our penetration there and what's a really big economy shows a lot of opportunity, but we're doing well in Spain as well I mean, they think they were you know I think.

Restarted their growth trends in Spain, as well I think that that geography is a little bit trickier as the margins arent as good but but you know again I think that mid teens as the baseline and only upside from there.

Bob Lissy: So that's how I would sum up the overall trend. Right. Thank you so much. That's very helpful. Our next question comes from Stan Selbas with Need Hand.

Awesome. Thanks, guys appreciate it.

But what I would what I'd add to that is that today. We're generally just in two countries in Europe continent, we have one store in Germany, It's a huge market opportunity, we think there's opportunities for us whether European license not only to expand further in Germany, and the middle run, but also in France, and we're also look.

Stan Selbas: Please proceed. Great. Thanks. Thanks, guys, for taking the questions. I'm hopping on for mine today.

Bob Lissy: I was wondering if you guys could provide some insight into some of the pricing dynamics you saw in the fourth quarter. I know earlier in the year, I think it was in the third quarter, you guys mentioned some, pricing pressures stemming from competitors. So can you guys just talk about what you saw in the fourth quarter and maybe how you guys are thinking about pricing in 2024? Yeah, what we saw is that we've actually been able to extend our margins in fourth quarter and increase them by being more efficient and and slicing it a little bit thinner. Previously, we made bigger movements with price related to the whole market. And now our price movements are related to places where there's an incremental upside in terms of wires.

At opportunities in the U K to get started there. So I think you'll see us be much more active in Europe. We think Europe is a great opportunity of retail, but because of the nature of the consumer there. We believe that our digital opportunity will catch on even faster because more consumers are already.

Ready to do digital wires, they have bank accounts, they're paid.

On the books on the payroll card and so we're looking forward to getting our digital app up and going in Europe, and then also targa expansion as we grow through other key countries like Germany, France, and ultimately U K.

Yeah, It makes sense.

Thanks, guys.

Once again it will have a question please press the star wine.

Thank you. This concludes our question and answer session I would like to turn the conference back over to the speakers for any closing remarks.

Bob Lissy: What we're very careful about is that we don't want to be discounting where we have wires in house where people are perfectly happy with the pricing and those wires are already wires we're going to get. Now, as we look at 24, the big opportunity for us is, certain areas of the country where there still remains, for instance, Southwest, we have a million foreign-borns living in zip codes in California that we haven't tapped into at all. As big as our California business is, in which it's several million wires a year, we haven't tapped into those zip codes at all.

Thank you all for tuning in and look forward to talking to you. All soon thanks again have a great day.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

Yeah.

Yeah.

Yes.

Uh huh.

[music].

Okay.

Yeah.

[music].

Bob Lissy: We also have another set of zip codes that have about 1.7 million people where we've tapped into very slightly. And so those are the places where you'll see a different pricing perspective, a different pricing action. We'll be much more aggressive there, but that doesn't degrade at all our current margins. Our current margins are gonna stay relatively stable. Those margins will be ones that will come in at a lower gross margin per transaction, but will be incremental transactions. So the overall average might come down a bit, but nothing will be done to degrade the core business.

Okay.

Okay.

[music].

Andrus Bendy: Got it. Okay, that's super helpful. And then just a quick follow up. Could you guys talk more about some of the momentum you're seeing in the ITransfer business and any expectations or any goals you guys have for the upcoming year? Yeah, you know, I would say that we built a plan that we feel comfortable can be in the mid teens, if we're operating the business similar to how it's operating today, but a little bit more efficiently, I think what we're trying to do is, is create more of a big bang plan, which you know, if we get off to the right start, you know, we'll be investing quite a bit in the front end, I think in the second half of the year, Italy, in particular, is a really interesting opportunity.

Yeah.

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Andrus Bendy: I think structurally, the margins are better in Italy. And I think, you know, our penetration there in what's a really big economy shows a lot of opportunity, but we're doing well in Spain as well. I mean, they think they were, you know, I think they've, they've restarted their growth trends in Spain as well. I think that that geography is a little bit trickier is the margins aren't as good. But, but, you know, again, I think that mid teens is the baseline, and only upside from there.

Hum.

Yeah.

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Bob Lissy: Awesome. Thanks, guys. Appreciate it. But what I would add to that is that today we're generally just in two countries in your continent. We have one store in Germany.

Hum.

Yeah.

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Bob Lissy: It's a huge market opportunity. We think there's opportunities for us, you know, with a European license, not only to expand further in Germany in the middle run, but also in France. And we're also looking at opportunities in the UK to get started there. So I think you'll see us be much more active in Europe. We think Europe is a great opportunity at retail, but because of the nature of the consumer there, we believe that our digital opportunity will catch on even faster because more consumers are already, ready to do digital wires. They have bank accounts, they're paid on the books on a payroll card.

Mhm.

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Right.

Bob Lissy: And so we're looking forward to getting our digital app up and going in Europe. And then also our expansion as we grow through other key countries like Germany, France, and ultimately UK. Alright, thanks guys. Once again, if you have a question, please press the star 1. Thank you. This concludes our question and answer session. I would like to turn the conference back over to the speakers for any closing remarks. Thank you all for tuning in. Look forward to talking to you all soon. Thanks again. Have a great day. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect, www.intmoney.com Rayna Kumar, Joseph Foresi, Rayna Kumar, Sloan Bohlen, Int Money Rayna Kumar, Joseph Foresi, Rayna Kumar, Sloan Bohlen, Int Money, Rayna Kumar, Joseph Foresi, Rayna Kumar, Sloan Bohlen, Int Money Rayna Kumar, Joseph Foresi, Rayna Kumar, Joseph Foresi, Rayna Kumar, Sloan Bohlen, Int Money, Sign up at Domestika.org Create. Share. Learn, www.intmoney.com, How are you? © BF-WATCH TV 2021, Support and Information © BF-WATCH TV 2021, © The Ultimate Parody Site! © BF-WATCH TV 2021

[music].

Yeah.

[music].

Yeah.

Okay.

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