Greetings, and welcome to the Euronet Worldwide’s First Quarter 2025 Earnings Call. At this time all participants are in listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. It is now my pleasure to introduce your host, Mr. Adam Godderz, General Counsel for Euronet Worldwide. Thank you. Mr. Godderz, you may begin.

Thank you. Good morning everyone and welcome to Euronet’s first quarter 2025 earnings conference call. On the call today we have Mike Brown, our Chairman and CEO; and Rick Weller, our CFO. Before we begin, I need to call your attention to the forward-looking statements disclaimer on the second slide of the PowerPoint presentation we’ll be making today. Statements made on this call that concern Euronet’s or its management’s intentions, expectations or predictions of further performance are forward-looking statements. Euronet’s actual results may vary materially from those anticipated in these forward-looking statements as a result of a number of factors that are listed on the second page of our presentation. In addition, the PowerPoint presentation includes a reconciliation of the non-GAAP financial measures we’ll be using during the call to their most comparable GAAP measures. Now I’ll turn the call over to our CEO, Mike Brown.

Thank you, Adam, and thank you everybody for joining us today on the call. I’ll begin my comments on Slide number 5. Well, let’s first just dive right into our results for the quarter and what a quarter it was. We achieved double digit constant currency growth in operating income and adjusted EBITDA highlighted by an 18% increase in operating income over the prior year. We didn’t just tiptoe into double digit growth territory, we kicked in the door. All segments contributed to these record earnings. As we exited the first quarter, ongoing commentary around immigration, tariffs and the trade war have dominated the headlines. There are a wide range of opinions regarding the macroeconomic impact, but the simple truth is that it’s too early to predict the impact of these policies as witnessed by the volatility in the stock market. However, we did not see significant adverse impacts on our business from these policy discussions on our first quarter results and with three fourth of our revenues generated from outside of The United States, we do not anticipate any significant direct impact to our business as a result. With these strong first quarter results together with our diversified global business, we are reaffirming our expectation to produce between 12% and 16% earnings for the year. As you may recall from our fourth quarter discussion, our business model is built on two key revenue pillars that will continue to expand as payment functionality evolves and business becomes more and more global. The first pillar is payment and transaction processing with which we facilitate high volume transactions for banks, merchants and brand partners, continually expanding our use cases to stay aligned with evolving demand. The second is cross-border and foreign exchange, with which we power FX related use cases and distribute FX services through a mix of owned and third party channels, spanning both physical and digital touch points to meet consumer and business payment needs. While the methods have and will likely continue to evolve, we believe it is fairly safe to say that people will always need to make payments. Euronet will continue leading the way with its innovative use cases. Now, I will hand it off to Rick to discuss the results in more detail.

Thank you, Mike. Good morning and thank you to everyone for joining us today. I will begin my comments on Slide 7. For the first quarter, we delivered revenue of $916 million, adjusted operating income of $75 million and adjusted EBITDA of $119 million, a record first quarter across all three metrics. These results were made possible by contributions from each of the segments, but with a particularly strong earnings contribution from the Money Transfer segment due to double digit transaction growth led by digital transaction growth of 31% compared to the prior year first quarter and double digit cross border transaction growth. Adjusted EPS of $1.13 compared to the prior year of $1.28. However, it is important to look a little deeper. For the first – for this year’s first quarter, the $1.13 included a one-time charge of $0.20 per share for the repurchase of the convertible bonds. With respect to the prior year’s first quarter, the $1.28 included a benefit of approximately $0.15 per share due to the reduction of certain tax matters. So on a pro form a basis, adjusted EPS grew 18% year-over-year. We were able to deliver this strong earnings growth due to our continued focus on expanding the business in new and existing markets, adding more products and continued investments in our industry-leading technology across all three segments. Needless to say, this strong start to the year strengthens our confidence in the 12% to 16% annual adjusted EPS range expectation we provided for 2025. Next slide please. Slide 8 presents a summary of our balance sheet compared to the prior year. As you can see, we ended the first quarter with some increase in cash and debt, which was the combined result of the generation of cash from operations and the use of $59…

Thank you, Rick. I will continue my comments on Slide number 12. Today, I want to talk about our business and how our growth strategy continues to produce results. Earlier, I mentioned our growth strategy by the continued global expansion of our leading global cross-border payments network focused on high value FX transactions. Moreover, the results Rick just reviewed are evidence that our strategy works producing double digit growth or maybe we could say doing double time. As we have discussed over the past few quarters, the strength of our business lies in the diversity of our three segments as well as the diversity within those segments. This quarter was a great example of just that. As the graph on Slide 12 illustrates, over the past ten years, our first quarter revenue has continued to grow. The continued constant growth year after year is due to our team’s execution of our strategy. Over the last ten years, our first quarter revenues have more than doubled from $435 million to over $937 million. Whether led by epay, EFT or Money Transfer, Euronet continues to produce record revenues. As we discussed, our business was built on two key revenue pillars that will continue to expand and reach more and more customers. First is payment and transaction processing and the second is cross border and foreign exchange. Without our diverse revenue streams, we would not have had the ability to produce consistent growth year after year. While our pillars will continue to expand and grow our global reach, we know that people will always need to make payments and Euronet will continue to lead the way. Now let’s move on to Slide Number 13 and I’ll discuss what makes up our revenue. I’m on 13 now. So, to quickly recap our business, Euronet…

Thank you. At this time, we will now conduct a question-and-answer session. [Operator Instructions] Our first question comes from Pete Heckmann from D.A. Davidson. The floor is yours.

Thank you. Good morning, everyone. I wanted to follow-up a little bit on Dandelion, the integration with Visa. I guess, is it possible to get a little bit more visibility into kind of the quarterly trends there or perhaps the year-over-year growth rates in 2024 and what you’re expecting for 2025? Sounds like there’s a number of deals getting done, but it’s kind of hard to see through the rest to see exactly what the trends are there.

Well, you saw that we had a 33% growth and I would tell you that virtually 100% of that is without Visa Direct because we just flipped on the Visa Direct switch show, I know a couple of weeks ago or so. So we don’t have any numbers in there for that. We’re very excited. This is a great distribution channel for our money transfer business and you know what it does is it makes it much, much easier for somebody to send money digitally. We like that because it costs us less than physical cash payout. All you’ve got to do is give them your name and give them the name and the card number of the recipient, so it’s really easy. So we’re excited about this, but it’s not in our numbers right now.

Okay. That’s helpful. And just as a follow-up on your partnership or joint venture in a couple of countries with Prosegur, do you anticipate that being an aggressive rollout or would consider more of a pilot program? How should we think about how…

Okay. So as you may know, Prosegur is kind of the brink of South America, Latin America and also Spain. And they’ve got an excellent reputation with all the banks there. So they give us entrees into these banks, so that we can get licensed in these countries. We want to go into, I’m not saying every country south of our border, but most all the countries south of our border. So we’re excited about that. Now, how it works is we get those, we light up those first few ATMs, we make sure we’ve got everything working really well and then we start to blow it out like we have in these other markets. So yes, we’re expecting aggressive rollouts in the Prosegur joint venture partner countries.

All right, great. Thank you.

And one last thing on that, excuse me, operator. Pete, don’t forget that every country south of our border has a different currency. So we’re not just talking about tourists from the U.S. who might go to Ecuador or something, but it’s just crossing the borders there for those countries, they’re going to need the local currency wherever they go, whenever they cross the border, so lots of opportunity for us.

Helpful. Thanks, good add.

That’s great. Thank you for the question. Our next question comes from Mike Grondahl from Northland. The floor is yours.

Hey, Mike and Rick, congrats on a nice quarter. Curious what you’re seeing over in Europe on the ATM side. Any early read on summer travel or consumer spending over there? How is it coming in according to plan?

It seems to be at least with three weeks or so into April, it’s just tracking right according to plan. And I mean, I think that’s the thing everybody’s got to remember is that 80% of our – of the customers who are ATMs where travel makes a difference are Europeans. So – and they’re still going on vacation. There have been some people who’ve hypothesized because of the U.S.’s stance towards Europe and some Europeans afraid to come here, maybe they’ll vacation at home instead of in the U.S. or whatever. But I think that’s all on the edges. What we’ve seen so far is everything seems to be lining up like we thought, very similar to last summer, but there will be more travelers this summer.

Got it. And then your 12% to 16% adjusted EPS growth this year guidance, how are you factoring FX into that? There’s been a pretty nice move up the euro to the dollar to $1.4. How are you thinking about that for 2025?

Yes. Mike, we generally just expect that the FX rates will hold flat. So we’ve not got increases built into our numbers. So if we see a measurable increase, it could give us a little bit of tailwind, but we don’t try to outguess it. You also have to keep in mind is that, we’ve got a mix of currencies around the world. So you can’t just look at one currency. And then as we said, we do have about 25% of our revenues generated in the U.S. So we’ve definitely seen a little benefit tailwind, but the assumption on a go forward basis is always that we don’t outthink it or put some projection on what will happen there.

Got it. Rick, maybe a better way to ask it, were there any put and takes to the 12% to 16% growth? Anything doing better, anything doing a little worse to call out, maybe there’s not.

Yes, well, I think if you’d really get behind all the math there, yes, you would see, we benefited a little bit more from some share repurchases the year-over-year carryovers of that. On the other side of the coin, we had more interest expense because rates were increasing as we went through much of last year, then we started seeing a little bit of a dip in it. So rates, interest rates a little bit more so, so that kind of offset some of that. Those were probably the biggest puts and takes to call out there. We didn’t have any like I mentioned there, we didn’t have any really significant benefit from share repurchases this quarter, because they were purchased towards the end of the quarter. So nothing really there. We had just a slight benefit on income taxes, not much. The – probably the best thing on the headlines is you kind of sort through some of that math and you again focus on 18% growth in operating income. That’s the heart of the business. That’s the strength and the fuel to the business. If we can’t grow our business at those kind of rates, we won’t have the earnings. So at the end of the day, the quality of our earnings, our year-over-year numbers, if try to let’s say cut out a lot of the noise that, that happens whether it’s purchase, share purchases, interest or tax or whatever and you go on a kind of an apples-to-apples basis, we had about an 18%, 19% year-over-year EPS growth, almost exactly what we had in operating income. And if I reflect back even to the full year of 2024, you would see the kind of same kind of math there. So I think the real showcase to our strength of the business is the strength of the earnings growth, which I think is very much to do with the diversity that we have across our business geographically, product wise, segment wise, customer wise. And we feel pretty good about the momentum that’s going in our business.

Great. Thank you.

Thank you. Great question. [Operator Instructions] Our next question comes from Chris Kennedy of William Blair. The floor is yours.

Good morning. Thanks for taking the questions. Can you just talk about consumers’ willingness to pay ATM surcharge or access fees in Europe? So it’s kind of a new concept over there. Any observations in the data.

Well, I think that the data seems to say that they – first of all, you’ve got to understand, we’re not the only people doing this. Much like the United States, if you go to any ATM that’s not your own bank’s ATM, you will pay what $3.50, $4 or whatever it is here, right? It’s exactly the same in Europe. Once Visa and Mastercard have allowed it in a given market, we do it, but everybody else doesn’t. So when you think about it that people really don’t – if you want the cash, that’s just kind of the common denominator. And so we don’t really see – we don’t see like a change in the price elasticity curve you might say.

Yes. The other thing I would point out is, what is very common practice in Europe is that the banks put on their customers what they call a disloyalty charge. And all of these banks have €2 or €3 that they charge their customer anytime they use an ATM other than on their network. So for the most part, customers are quite accustomed to paying a fee if they’re using an ATM that’s other than their banks. And then the other thing that – aside from that as Mike mentioned here earlier too in the comments is that we sign participation agreements with banks across Europe and that gives the bank the ability to extend its presence across the wider area of broader number of ATMs and that’s good for the customer and it’s good for us. So again, we see that the practices are pretty consistent where banks charge customers off bank kind of fees. So customers are, let’s say, accustomed to that type of a fee.

And it does two things. First of all, once you’ve got and that’s, we call it, a surcharge here on ATMs. It opens up for us more ATMs in that potential market because then we can go after the local transactions where we might not have gone after that ahead of time. And second, like, Rick says, we signed network participation agreements with banks so that they use our network, our Euronet branded network as an extension of their own and they basically buy transactions from us at wholesale. And if you might remember the first country in Continental Europe that did this was Spain and we must have 30 different banks in Spain who have contracts with us so that their customers have access to our ATMs with a no fee agreement. So it actually lengthens our runway for numbers of ATMs in Europe as more and more surcharges come into the market.

Right. Very clear. Thank you for that. And then just a quick update on the merchant services business, it seems like you’re expanding into new geographies and Mike, I think you mentioned tight expense management on that business.

Well, yes, our goal is to expand into Portugal, Spain and Italy. They have a similar kind – they’re hyper competitive, first of all. And we – and so we’re kind of starting from scratch, but we understand how to have a value proposition that’s good for the small merchants in these Mediterranean touching countries. And so that’s our goal is to take the tricks that we’ve learned in Greece and export them to those three other countries. And we’re just on the beginning of that right now. We’ve hired sales forces, we’re going out selling to the merchants and trying to dislodge them from their current providers, because we’ve got a good value prop.

Great. Thanks for taking the questions.

Thank you for your question. [Operator Instructions] Our next question comes from Gus Gala from MCH. The floor is yours.

Hi, Mike. Hi, Rick. Thanks for taking our questions. Could you talk about the Ria digital shift? Two areas I want to dig in on. Can you talk about maybe efficiencies around digital marketing and so far as driving the strength in the branded digital? And then any commentary around how your maybe gross profit dollar retention has been trending, anything to qualify on that front would be helpful. And then on a similar front and money transfer, could you talk about how you’ve dealt with more entrance into the independent channel domestically in the past? Sounds like a larger peer is more actively pursuing that space here in the U.S.? Thanks.

Well, I mean, you just look at our money transfer results and they speak for themselves. I mean, we are absolutely crushing it with our Ria business up and down the value chain. We start with Ria at bricks and mortars, we have riamoneytransfer.com on the online side, you can see that our growth there is 30%. We continue to grow that kind of 30% quarter on quarter on quarter and keeps on happening. We do see some entrance, but we also see people dying off. I mean, this is a hyper competitive market. Last year, we saw two of the, I would say, major mid-sized players just evaporate one in Europe, one in the U.S. So it is competitive. One of the things that we’ve got going for us is that we have an omni-channel strategy. And that’s where you can have the same customer number and the same relationship with us whether you use bricks and mortar or you go digital. And so what that’s done is it’s actually helped us continue to keep these customers as they may migrate from bricks and mortar to more digital areas.

Yes, you also asked about gross profit. As I mentioned earlier, there’s – actually, we saw a little increase in our gross profit per transaction. So we feel pretty good about the stability of the market out there. And to further Mike’s comments about the other guys in the business, look, we purchased this Ria business, it’s been in our group now since 2007. And there’s rarely an agent that we have – that you walk in there that there aren’t four or five other brands that are actively competing. And so this has been the way we’ve lived. It’s the kind of day to day kind of hand combat battle that Juan and his team do every single day. So we do see sometimes the names on the brands that we compete with change out there, but the competitive nature of the independent channel hasn’t been much today different than it has been over the last fifteen years.

Got it, appreciate the comment.

Thank you for your question. Go ahead. You have one more.

Yes, sorry. And then one on the – on EFT. Can we talk about the LATM opportunity a little bit? Maybe is there a way to quantify what the opportunity could be in terms of ATMs, transactions? And then a second layer, could you – in the past you’ve talked about the productivity of these ATMs outside of Europe being much higher. Could you put a finer point on how this the Prosegur, how their ATMs kind of look versus those numbers? Yes, anything of note there would be helpful.

Okay, So some of this is too early to give you actually – actual numbers. I mean, we’ve used Prosegur as our JV partner just in two markets and that’s the two new ones, the DR and Peru. So we’re just starting, we don’t have any data. However, we entered into Mexico on our own and they’re extremely profitable for us. And the one thing you’ve got to remember is in Europe, the bulk of Europe uses Europe, right? And these are Euro to Euro transactions and so they’re not cross currency, so you can’t make a currency spread on those transactions in Europe. However, virtually, every transaction that we do – a cross border transaction that we do in South America or Latin America is all cross currency. So much higher percentage of our transactions can be DCC transactions, which give you the ability to make more than a couple of bucks on a surcharge. So that’s – there’s a lot of opportunity there, it’s same kind of thing that we saw in North Africa with Morocco and in Egypt and the same thing we see in Malaysia and the Philippines, lots of DCC opportunities there, lots of travelers just traversing those geographic areas. So I can’t tell you exactly how big it’s going to be, but we know the opportunity is large.

Got you. Appreciate all the comments as usual.

Thank you for your questions. [Operator Instructions] Our next question comes from Rayna Kumar from Oppenheimer. The floor is yours.

Good morning. Thanks for taking my question, and good results here. I think earlier you had mentioned that 80% of tourists in Europe are Europeans themselves. Are you able to break that out a little bit further and talk about, like, what percentage you see are U.S. tourists?

We – I think I know that 80% of our customers in Europe are Europeans And of the 20% that’s left, about half of that comes from Britain and the other half is comes from the U.S. and all the other countries. And I bet you [ph], I don’t know that number off the top of my head, maybe Rick does, but I’d say the U.S. might be half-ish of the last 10%?

Yeah. Pretty close. It’s just slightly less than half, but that we’re in the we’re in the right zip code.

Yes.

Understood. Okay, that’s really helpful. And then I just want to ask about money transfer. Like how much benefit do you guys think you got from just the FX volatility in the quarter, like versus, I guess, what your competitors are doing?

I don’t think that we got much benefit in the first quarter. I didn’t think that we started seeing the volatility move as much until kind of towards the end of the first quarter. We have seen more activity in the first part of April here. But I would say on balance not much in the first quarter, but again it looks like April is activities picked up. And I think that kind of coincides with a lot of the press. I mean, if you remember April 2nd was a big announcement date on the tariff position. So I think that’s kind of when you really started seeing the volatility move.

Understood. Okay. And then just finally on the ATM business, it’s good to see the Dominican Republic and Peru up on your ATM. Can you just comment on how many ATMs in general you expect to add this year?

Well, as we said before, we would probably start moving away from that kind of a thing, just so that’s just another statistic to have to measure. But together with and we’d also had announced that we signed a transaction in Eastern Europe that’ll add quite a few ATMs from an outsourced basis. So I would tell you that we would expect our business to add ATMs consistent with the prior years. So we weren’t wanting to put out a specific number on that, but you can expect that we will continue to put in about the same number of ATMs. And if we see a little bit more traction somewhere or if we sign some larger outsource deals, we could go through that. But our momentum would be consistent with what we’ve done in the prior years.

Great, thank you.

Thank you for your question. Our next question comes from Darrin Peller with Wolfe Research. The floor is yours.

Hi. Thanks. This is Daniel Krebs on for Darrin Peller. Just wanted to follow-up on the merchant services outside of Greece. I know it’s early efforts now, but in your view, how long is the typical sales cycle and ramp period until we could start to see some material contributions from these countries? Thanks.

So I think we’ll materially – one of the challenges we got is that Greece is just crushing it. So when you say material in comparison to Greece or just kind of or adds up to a few millions, I would say that that’s probably not going to be till late this year, early next year. But we’re working hard. We see the opportunity. Pardon me.

Well, I think another demonstration of that and the credibility of what we have to offer. As we mentioned there earlier, we just signed the Munich Airport. I mean...

Right.

...this is a major player in Europe. The Germans have exacting standards of quality and so I think speaks to the quality of what we have to offer. So, that we started seeing the momentum grow there and we’re not just a household name out there in the merchant processing. We’ve got a lot more strength in Greece, but we’ll continue to drive that. But that’s just a good example of people recognizing what we have to offer.

Got it. Yes. Thank you. That’s great.

It’s also recognizing the quality of our technology because really these folks are wanting to be able to have payments process from all people that come through that airport. And they’re not people carrying just a traditional Visa or Mastercard type of a product. They’ve got QR code kind of products, things like that. This is non-traditional card processing type of payment and so people are making recognition of the technology difference we make to help them serve their customers better.

Understood, thanks. And just a quick follow-up maybe on the travel trend. Do you potentially see a scenario where if there’s slower inbound to U.S. and U.S. domestic activity, that some of that travel activity could end up shifting to Europe? I’m not sure if you’ve seen any of that in early bookings data perhaps?

Haven’t seen anything show up in the numbers. I think you raise a good question that we just haven’t seen any kind of data on it. But you’re right to the extent that someone from outside the United States that may have planned to come to the United States feels like they don’t want to make the trip here. Well, the next largest tourist location is Europe. And so – and because we’ve deployed in some of the other AsiaPac markets, the Northern African markets, we’ve got a lot of those places covered. So if consumers do shift their preference or their behavior there, we might get a little benefit from that.

Great, thank you so much.

Thank you for your question. Our last question comes from Zachary Gunn of FT Partners. The floor is yours.

Hey there. Thanks for taking the question. Apologies if I missed it. I just want to ask, were there any incremental geographies that launched direct access fees this quarter? I know there’s a couple expected to come on in 2025. And just with that, is there any way to think about the contribution of incremental countries and what that’s expected to contribute to that EPS guide for the full year?

I don’t think we had any new ones come on in the first quarter. We had some that and I can’t remember which countries or which I might have said in my Q4 call. We had a few come on in the fourth quarter so that we would get the benefit of them in the first quarter. But if they – but I can’t remember anything past that deal.

Yes. I don’t recall nothing in terms of a new addition in the first quarter. Like Mike said, we’re getting some full year benefit here from some of those others. We’ve got some others that are on the radar screen that we would expect this year, but we’re not the folks that make those announcements and so we don’t want to put the names out there until it’s really the card organizations that have to make those announcements and things like that. So we do expect some more this year, but nothing new came on board in the first quarter.

Got it. That’s helpful. Then just quickly as a follow-up, I just want to ask on the regulatory environment. Obviously, money transfer came in strong this quarter, but we saw specifically FinCEN put out some geographic targeting orders on zip codes in the U.S. and it’s probably a small proportion of overall volume. But what are you seeing in the regulatory environment today? Do you think that there’s risk that these type of restrictions on filing CTRs and decreasing the amount required that expands further? Just any commentary on that would be helpful.

Look, I think it’s always hard to out guess that, but maybe if we reflect a little bit on kind of the world that we operate in and essentially we operate on and have been on a basis that generally has been taking IDs on folks and we’ve seen these kind of things before. We haven’t seen any kind of like we said earlier, any kind of significant difference show up out there. And so our general view at this time is that we don’t anticipate any kind of adverse reactions from that. But it really all depends on what kind of action could be taken in the future. We operate on an ID basis pretty much around the world, if you will. And so when people are sending money, they’re generally accustomed to that. So again, as I said, we haven’t seen anything now. And as of what we see in the market today, we don’t expect anything significant in that regard.

And aside from that or because of our very diligent view on compliance and regulation and all that, we have an absolutely pristine compliance record. Our larger competitors cannot brag about that, we certainly can, over all the years over 30 years of doing this, we don’t get into trouble because we play it by the book and we’re very conservative. I think with that...

[Indiscernible]

Yes. I think with that Zach, we’re going to have to cut it off. But I thank everybody for their time today and I look forward to seeing them in about 90 days. Thank you.

Thank you everyone for your participation in today’s conference. This does conclude the program. You may now disconnect.