MoneyGram (NASDAQ:MGI) today reported financial results for its third quarter ended September 30, 2016.

Third Quarter Financial Results

• Total revenue for the quarter was $383.1 million, an increase of 4% on a reported basis and 5% on a constant currency basis.
• Net income for the quarter was $10.2 million, an increase of $5.3 million, and EBITDA was $58.1 million, an increase of 17%.
• Operating income for the quarter was $26.2 million, an increase of 58%.
• Adjusted EBITDA for the quarter was $68.7 million, an increase of 5% on a reported basis and 8% on a constant currency basis.  Adjusted EBITDA margin was 18%.
• Income tax expense for the quarter was $4.7 million, representing a 32% tax rate.  The lower tax rate, which benefited earnings per share by $0.01, resulted primarily from certain tax credits realized in the quarter.
• Diluted earnings per share for the quarter was $0.15. Adjusted diluted earnings per share was $0.25.
• Year-to-date Adjusted Free Cash Flow was $83.6 million, an increase of $103.6 million from the prior year period.

“Our focus on driving profitability yielded solid improvements to key financial metrics in the third quarter including gross margin, operating profit, EBITDA, net income and cash flow, resulting in a strengthened balance sheet,” said Alex Holmes, MoneyGram’s chief executive officer. “The quality of our earnings also improved even as revenue growth continued to be impacted by economic challenges in certain countries and geopolitical issues. We are navigating these challenges and remain confident in the fundamentals of our business as we capitalize on profitable growth through new products and global expansion opportunities.”

Third Quarter Money Transfer Highlights

• Money transfer revenue for the quarter was $339.6 million, representing a 4% increase on a reported basis and 5% on a constant currency basis.
• Money transfer revenue reflects continued growth in the Company’s Non-U.S. and U.S. Outbound sends in the third quarter:
  • Non-U.S. revenue grew 4% on a reported basis and 6% on a constant currency basis led primarily by Europe offset by headwinds in the Middle East and parts of Africa.
  • U.S. Outbound revenue grew 8% on a reported and constant currency basis led by sends to Latin America, parts of Asia and Africa.
  • U.S. to U.S. revenue declined 7% on a reported and constant currency basis primarily due to lower volume of transactions under $200.
• Money transfer revenue from U.S. Outbound and Non-U.S. sends grew 6% in the quarter on a reported basis and 7% on a constant currency basis and accounted for 88% of total money transfer revenue.
• Digital money transfer revenue grew 12% over the prior year, and represented 13% of total money transfer revenue.
• Digital money transfer transactions increased 4%, and represented 15% of total money transfer transactions. These results reflect the Company’s grow-over of the successful launch of its new moneygram.com in the prior year and softness in Saudi Arabia where a large portion of the business is driven by digital assets.
• moneygram.com attracted more than 225,000 new active customers.

Mr. Holmes continued, “We are excited to be a leader in the digital revolution that is overhauling the customer experience and transforming the money transfer industry. Innovative products including MoneyGram Kameleon, MoneyGram MobilePass, our award winning website, mobile app and kiosks showcase MoneyGram’s capabilities in financial technology and bring us closer to our customers. As we overlay these capabilities with our expanding global cash-based physical network of agent locations, our value proposition becomes even more distinct, our relationships with our customers even more dynamic, and our future growth prospects even stronger.”

Full Year 2016 Outlook

For the full year 2016, the Company’s outlook for 7%-9% constant currency revenue growth and constant currency adjusted EBITDA growth of 9%-11% is unchanged.

Conference Call

MoneyGram International will host a conference call today at 8:00 a.m. CT, 9:00 a.m. ET, to discuss its results. Alex Holmes, chief executive officer, and Larry Angelilli, chief financial officer, will host the call.

About MoneyGram International, Inc.

MoneyGram is a global provider of innovative money transfer and payment services and is recognized worldwide as a financial connection to friends and family. Whether online, or through a mobile device, at a kiosk or in a local store, we connect consumers any way that is convenient for them. We also provide bill payment services, issue money orders and process official checks in select markets. More information about MoneyGram International, Inc. is available at moneygram.com.