By Tess Stynes
Western Union Co. (WU) said its first-quarter earnings edged up
0.4% on lower costs but negative currency impacts masked the
company's underlying revenue growth.
Englewood, Colo.-based Western Union has faced increased
competition in recent years from companies as diverse as PayPal,
Apple Inc. (AAPL), and Wal-Mart Stores Inc. (WMT) as it expands
from a cash-based business to one with an increased focus on
digital payments.
Earlier this year, the company said it will begin international
direct-to-bank money transfers to Mexico from the U.S. through
Grupo Financiero Banorte SAB's (GBOOY, GFNORTE.MX) UniTeller
network, a moves that aims to expand the money-transfer-services
company's range of customers in Mexico.
Overall, Western Union reported a profit of $203.9 million, or
39 cents a share, up from $203 million, or 37 cents a share, a year
earlier. Revenue decreased 2% to $1.32 billion. However, excluding
currency impacts, revenue rose 4%.
Analysts polled by Thomson Reuters expected per-share profit of
38 cents and revenue of $1.31 billion.
Operating margin rose to 20.6% from 20.1%, mostly on
cost-savings initiatives. Overhead expenses declined 1.7%, while
total expenses dropped 2.8%.
Sales in its consumer-to-consumer business, its largest by
revenue, declined 3.6% to $1.04 billion on currency impacts.
Transaction volume rose 3%. Consumer-related sales on
westernunion.com improved 17% as transactions climbed 25%.
Electronic-channel revenue also grew by 17%. The segment includes
westernunion.com, account-based money transfers through banks, and
mobile money transfer.
Western Union also affirmed its 2015 outlook.
Write to Tess Stynes at tess.stynes@wsj.com
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