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Euronet (EEFT) Q1 Earnings Surpass Estimates, Improve Y/Y

Zacks Equity Research

Euronet Worldwide, Inc. EEFT delivered first-quarter 2019 earnings of 85 cents per share, beating the Zacks Consensus Estimate by 2.4%. Moreover, the bottom line improved 16.4% year over year.  This upside can mainly be attributed to double-digit contributions from all the segments. 

The company’s reported net income was up 26.5% to 62 cents per share in the quarter under review.

Its total revenues were $577.5 million, up 4.9% from the year-ago quarter owing to solid contributions from EFT Processing Segment and Money Transfer segment. However, the top line missed the Zacks Consensus Estimate by 4.2%.

Euronet’s total transactions were 1.06 million, having increased 17% year over year.

Adjusted operating income rose nearly 23% to $56.1 million.

Euronet Worldwide, Inc. Price, Consensus and EPS Surprise

Euronet Worldwide, Inc. Price, Consensus and EPS Surprise | Euronet Worldwide, Inc. Quote

Segment Results

EFT Processing Segment’s total revenues grew 7% (16% at constant currency basis) year over year to $145.7 million on the back of higher transactions and a rise in operated ATMs. Adjusted EBITDA amounted to $33.4 million, up 21% (29% at constant currency basis) from the year-earlier period. Operating income for the segment was $16.8 million, up 46% year over year (up 54% on constant currency basis).

The epay Segment’s total revenues are flat at $176.1 million (up 6%atconstant currency). Adjusted EBITDA amounted to $19.8 million, up 5% improvement from the year-earlier quarter’s figure (13% up on constant currency basis). Operating income stands at $18 million, up 7% year over year (15% increase on constant currency basis). This segment reported transactions of 338 million, up 31% year over year.

The Money Transfer Segment’s total revenues climbed 7% (11% at constant currency) year over year to $256.6 million, backed by higher transactions. Adjusted EBITDA amounted to $38.8 million, reflecting a 13% rise (18% increase at constant currency) from the prior-year quarter. Operating income for this segment totaled $30.7 million, up 22% on constant currency basis. This segment reported total transactions of 26.6 million, up 10% year over year.

Corporate and other Segment reported an expense of $9.4 million for the quarter under review, same as the year-ago quarter’s number.

Q2 Guidance

Euronet expects adjusted earnings per share to be nearly $1.69 per share in the second quarter of 2019.

Financial Update

Total assets at first-quarter end were $3.8 billion, up 14.8% from the level at year-end 2018.

Cash and cash equivalents improved nearly 15.4% to $1.2billion from the figure at 2018 end.

The company’s total indebtedness increased 22.7% to $786.9 million from the count as of Dec 31, 2018.

Zacks Rank and Performance of Other Players

Euronet carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Among other players from the finance sector having reported first-quarter earnings so far, the bottom-line figures of Oaktree Specialty Lending OCSL, Discover Financial Services DFS and Synchrony Financial SYF surpassed the respective Zacks Consensus Estimates.

 

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