Global Funds Transfer Segment Results
Total revenue for the Global Funds Transfer segment was $317.9 million, up 6 percent from $298.9 million in the third quarter of 2011. The segment reported operating income of $39.3 million and operating margin of 12.4 percent. Adjusted operating margin was 14.2 percent in the quarter, down from 16.4 percent in the prior year as a result of increased marketing spend and a lower euro valuation to the U.S. dollar. The increase in marketing was a planned shift in spend from the fourth quarter to the third quarter to take advantage of certain seasonal and global campaigns. For the full year, the Company still expects total marketing spend of approximately 4.5 percent of total revenue.
During the quarter, money transfer transaction volume increased 13 percent, continuing the Company’s double-digit growth trend. Money transfer fee and other revenue increased 8 percent to $291.3 million, compared with $270.4 million in the third quarter of 2011. On a constant currency basis, money transfer fee and other revenue increased 11 percent, the Company’s sixth consecutive quarter of double-digit growth.
Money transfer transactions originating outside of the U.S. increased a robust 18 percent over the prior year. U.S.-to-U.S. money transfer transaction volume continued its strong growth, increasing 9 percent over the prior year. U.S. Outbound transaction volume growth was 13 percent for the quarter led by U.S.-to-Mexico growth of 19 percent.Bill payment transaction volume decreased 4 percent, while fee and other revenue decreased 7 percent to $26.4 million from the third quarter of 2011. Excluding the fourth quarter 2011 divestiture, transactions increased 5 percent and fee and other revenue decreased slightly. Financial Paper Products Segment Results Total revenue in the Financial Paper Products segment declined 10 percent to $20.3 million in the quarter, down from $22.5 million in the prior year quarter. Operating income was $7.6 million, up from $5.5 million in the third quarter of 2011. Operating margin was 37.3 percent. Adjusted operating margin was 39.7 percent in the quarter, up from 30.5 percent in the same period last year.
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