Moneygram International, Inc. EBITDA jumped on 28.8% while Revenue decreased on 5.3%
02/22/2021 • About Moneygram International, Inc. (
$MGI) • By InTwits
Moneygram International, Inc. reported 2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Moneygram International, Inc. is a company in decline: 2020 revenue growth was -5.3%, 5 years revenue CAGR was -4.6%
- EBITDA Margin is expanding: 15.0% in 2020 vs. 11.0% in 2019 vs. 10.3% in 2016
- EBITDA Margin is quite volatile: 15.0% in 2020, 11.0% in 2019, 6.5% in 2018, 5.6% in 2017, 10.3% in 2016
- Moneygram International, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.4%. At the same time it's a lot of higher than industry average of 3.0%.
- CAPEX is quite volatile: $15m in FY2020, $47m in FY2019, $45m in FY2018, $70m in FY2017, $187m in FY2016
- The company has highly profitable business model: ROIC is 15.9%
- It operates with high leverage: Net Debt/EBITDA is 4.0x while industry average is 1.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Moneygram International, Inc.'s Revenue decreased on 5.3%. Annual revenue decline showed slowdown in 20Q4 - revenue showed almost no change in 20Q4. During 2016-2020 Revenue growth bottomed in 2019 at -11.2%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 4.0 pp from 11.0% to 15.0% in 2020. During 2016-2020 EBITDA Margin bottomed in 2017 at 5.6% and was growing since that time.
Gross Margin decreased on 2.1 pp from 48.5% to 46.4% in 2020. Gross Margin declined at -1.3 pp per annum in the last 5 years.
Net Income margin increased on 4.0 pp from -4.7% to -0.65% in 2020.
Investments (CAPEX, working capital and M&A)
In 2020 the company had CAPEX/Revenue of 3.4%. CAPEX/Revenue decreased slightly on 1.9 pp from 5.2% in 2017 to 3.4% in 2020. It's average CAPEX/Revenue for the last three years was 3.9%. CAPEX as a % of Revenue stuck to a declining trend at -0.44 pp per annum in the last 5 years.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.0x and Debt / EBITDA is 5.0x. Net Debt / EBITDA dropped on 1.4x from 5.4x to 4.0x in 2020. Debt increased slightly on 1.4% while cash jumped on 33.6%. During 2016-2020 Net Debt/EBITDA topped in 2017 at 8.0x and was declining since that time.
Moneygram International, Inc. has no short term refinancing risk: cash is higher than short term debt (1,400.7%).
Management team
W Alexander Holmes "Alex" is a Moneygram International, Inc.'s CEO. W Alexander Holmes "Alex" has spent 5 years with the company. Lawrence Angelilli "Larry" is a the company's CFO. Lawrence Angelilli "Larry" has spent 5 years at the company.
Financial and operational results
FY ended 12/31/2020
Moneygram International, Inc. ($MGI) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 1,630 | 1,602 | 1,448 | 1,285 | 1,217 | -5.3% |
| Gross Profit | 835 | 830 | 740 | 623 | 564 | -9.4% |
| EBITDA | 168 | 90 | 95 | 142 | 182 | 28.8% |
| Net Income | 16 | -30 | -24 | -60 | -8 | |
Balance Sheet
|
|---|
| Cash | 157 | 190 | 146 | 147 | 196 | 33.6% |
| Short Term Debt | 0 | 0 | 0 | 54 | 14 | -74.2% |
| Long Term Debt | 915 | 908 | 901 | 850 | 903 | 6.2% |
Cash flow
|
|---|
| Capex | 83 | 84 | 58 | 55 | 41 | -25.1% |
Ratios
|
|---|
| Revenue growth | 5.9% | -1.7% | -9.6% | -11.2% | -5.3% | |
| EBITDA growth | 103.8% | -46.5% | 5.7% | 49.4% | 28.8% | |
|
|---|
| Gross Margin | 51.2% | 51.8% | 51.1% | 48.5% | 46.4% | -2.1% |
| EBITDA Margin | 10.3% | 5.6% | 6.5% | 11.0% | 15.0% | 4.0% |
| Net Income Margin | 1.0% | -1.9% | -1.7% | -4.7% | -0.6% | 4.0% |
| CAPEX, % of revenue | 5.1% | 5.2% | 4.0% | 4.2% | 3.4% | -0.9% |
|
|---|
| ROIC | 12.4% | 2.1% | 2.9% | 8.5% | 15.9% | 7.5% |
| Net Debt/EBITDA | 4.5x | 8.0x | 8.0x | 5.4x | 4.0x | -1.4x |
Moneygram International, Inc. ($MGI) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 291 | 280 | 323 | 323 | | -7.8% | -13.6% | 0.3% | -0.1% |
| EBITDA | 30 | 38 | 53 | 47 | | -4.7% | 5.2% | 51.7% | 33.2% |
| Net Income | -22 | -5 | 11 | 7 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 131 | 131 | 163 | 196 | | 0.8% | -2.2% | 36.8% | 33.6% |
| Long Term Debt | 878 | 856 | 857 | 903 | | -2.4% | 1.6% | 1.2% | 6.2% |
Ratios
|
|---|
| Gross Margin | 46.9% | 45.4% | 46.0% | 47.0% | | -2.1% | -2.8% | -2.5% | -1.1% |
| EBITDA Margin | 10.4% | 13.7% | 16.2% | 14.4% | | 0.3% | 2.4% | 5.5% | 3.6% |
| Net Income Margin | -7.4% | -1.6% | 3.4% | 2.3% | | -3.1% | 6.8% | 5.8% | 5.9% |
Peers in Data Processing & Outsourced Services
Below we provide Moneygram International, Inc. benchmarking against other companies in Data Processing & Outsourced Services industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Square, Inc. ($SQ) | - | 29.6% | 49.0% | 42.9% | 101.5% |
| Global Payments Inc. ($GPN) | - | 37.2% | -15.3% | 45.9% | 51.1% |
| Fiserv, Inc. ($FISV) | - | 3.5% | 2.2% | 74.9% | 45.8% |
| NIC Inc. ($EGOV) | - | 5.8% | 2.5% | 2.7% | 30.0% |
| StoneCo Ltd ($STNE) | - | 74.3% | 106.0% | 63.1% | 28.9% |
| |
|---|
| Median (39 companies) | 6.7% | 11.8% | 7.5% | 11.5% | -2.7% |
|---|
| Moneygram International, Inc. ($MGI) | - | -1.7% | -9.6% | -11.2% | -5.3% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Verra Mobility Corp ($VRRM) | - | 97.4% | 97.5% | 95.7% | 91.5% |
| EVO Payments, Inc. ($EVOP) | - | - | - | 80.2% | 80.8% |
| StoneCo Ltd ($STNE) | 69.7% | 70.8% | 79.5% | 83.4% | 76.8% |
| WEX Inc. ($WEX) | 54.7% | 58.8% | 63.3% | 61.7% | 56.8% |
| Sabre Corporation ($SABR) | 32.2% | 30.1% | 27.8% | 56.6% | 56.6% |
| |
|---|
| Median (31 companies) | 39.2% | 38.9% | 40.9% | 40.3% | 36.5% |
|---|
| Moneygram International, Inc. ($MGI) | 51.2% | 51.8% | 51.1% | 48.5% | 46.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Visa Inc. ($V) | 55.6% | 69.2% | 65.8% | 68.1% | 68.5% |
| Mastercard Incorporated ($MA) | 56.9% | 56.5% | 51.8% | 60.9% | 56.6% |
| FleetCor Technologies, Inc. ($FLT) | 52.0% | 50.8% | 55.9% | 57.6% | 52.2% |
| StoneCo Ltd ($STNE) | 31.4% | 26.0% | 53.0% | 62.4% | 52.1% |
| Black Knight, Inc. ($BKI) | 43.0% | 44.6% | 43.3% | 46.0% | 44.9% |
| |
|---|
| Median (38 companies) | 21.3% | 21.1% | 19.4% | 22.2% | 19.1% |
|---|
| Moneygram International, Inc. ($MGI) | 10.3% | 5.6% | 6.5% | 11.0% | 15.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| PagSeguro Digital Ltd. ($PAGS) | 6.4% | 4.3% | 1.4% | 5.8% | 22.3% |
| StoneCo Ltd ($STNE) | 7.2% | 18.4% | 8.9% | 12.9% | 11.2% |
| Cardtronics plc ($CATM) | 9.9% | 9.6% | 8.0% | 9.3% | 8.3% |
| Verra Mobility Corp ($VRRM) | - | 11.5% | 7.2% | 6.6% | 6.2% |
| Fiserv, Inc. ($FISV) | 5.3% | 5.0% | 6.2% | 7.1% | 6.1% |
| |
|---|
| Median (38 companies) | 3.2% | 2.9% | 3.0% | 3.0% | 3.0% |
|---|
| Moneygram International, Inc. ($MGI) | 5.1% | 5.2% | 4.0% | 4.2% | 3.4% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Mastercard Incorporated ($MA) | 57.5% | 60.6% | 64.7% | 72.7% | 47.6% |
| International Money Express, Inc. ($IMXI) | -1.3% | -1.4% | 12.1% | 36.0% | 31.4% |
| NIC Inc. ($EGOV) | 63.1% | 52.1% | 39.3% | 26.5% | 30.8% |
| Visa Inc. ($V) | 18.1% | 21.9% | 23.0% | 27.2% | 23.2% |
| Western Union Company (The) ($WU) | 10.7% | 11.9% | 27.8% | 21.5% | 22.1% |
| |
|---|
| Median (39 companies) | 11.1% | 10.7% | 12.1% | 8.2% | 5.5% |
|---|
| Moneygram International, Inc. ($MGI) | 12.4% | 2.1% | 2.9% | 8.5% | 15.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| WEX Inc. ($WEX) | 6.7x | 4.4x | 3.1x | 3.4x | 12.1x |
| Exela Technologies Inc ($XELAU) | 8.1x | - | 9.7x | - | 10.7x |
| Alliance Data Systems Corporation ($ADS) | 10.7x | 10.1x | 9.0x | 11.7x | 9.2x |
| Verra Mobility Corp ($VRRM) | - | 10.7x | 6.9x | 3.5x | 4.7x |
| GreenSky, Inc. ($GSKY) | -1.5x | -1.5x | 0.5x | 1.5x | 4.6x |
| |
|---|
| Median (35 companies) | 1.3x | 2.3x | 2.0x | 2.1x | 1.9x |
|---|
| Moneygram International, Inc. ($MGI) | 4.5x | 8.0x | 8.0x | 5.4x | 4.0x |
