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Mar 31, 2020
Euronet Q1 2020 Earnings Report
Euronet's financial performance was impacted by the COVID-19 pandemic, with revenue slightly increasing but operating income and net income significantly decreasing compared to the same period last year.
Key Takeaways
Euronet Worldwide reported a slight increase in revenue but a significant decrease in operating and net income for Q1 2020 due to the COVID-19 pandemic. The company focused on employee safety, customer service, and fiscal responsibility. Despite challenges, Euronet maintained a strong cash position and implemented cost-saving measures.
Revenues increased by 1% to $583.9 million, impacted by COVID-19.
Operating income decreased by 44% to $31.6 million due to fewer European ATM transactions and SG&A investments.
Net income attributable to Euronet decreased to $1.9 million, with diluted earnings per share at $0.04.
The company is implementing cost-saving measures and focusing on long-term growth despite the pandemic's impact.
Euronet
Euronet
Euronet Revenue by Segment
Revenue by Segment
EFT Processing Revenue
CapyFin.comepay Revenue
CapyFin.comMoney Transfer Revenue
CapyFin.com Forward Guidance
The Company expects that in the second quarter its Adjusted EBITDA will be nearly break-even and after capital expenditures, interest and taxes, the business will consume approximately $25 million of its cash, which is readily available from the Company's cash balances.
Positive Outlook
- Leading-edge technology platforms
- Diverse product portfolio
- Global geographic presence
- Implemented cost saving measures
- Very strong balance sheet with plenty of liquidity
Challenges Ahead
- Adjusted EBITDA will be nearly break-even
- The business will consume approximately $25 million of its cash
- Transaction declines in EFT segment's ATM business ranging from minimal declines to as much as 95%
- Decreases in the brick-and-mortar channels have been about 35%
- Majority of digitally-initiated transactions have been low-margin transactions in India
Revenue & Expenses
Visualization of income flow from segment revenue to net income