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Earnings Calls: 
Western Union Q3 2009 Earnings Call Transcript
Author: 123jump.com Staff
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Last Update: 3:20 AM ET October 30 2009

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The Western Union Company third quarter revenues fell 5% to $1.31 billion and net income fell 25% to $181 million or 26 cents a share.


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You know, our trends have been pretty stable up to the quarter. I think the one thing that''s unique in this particular quarter is Ramadan and it’s shifted, so when you shift Ramadan you shift the trends. But everything came in basically as we expected and so we''re feeling very comfortable in terms of our transaction trends.

Darrin Peller - Barclays Capital

Okay. And then maybe was there any [inaudible] you mentioned briefly that you were pretty comfortable with the domestic side. Are you seeing any pickup there or in any of the other key corridors?

Christina A. Gold

We are happy with the domestic side and I think we''ve given guidance for the rest of the year and we feel confident in the guidance we put forward.

Darrin Peller - Barclays Capital

Okay. And then with regard to revenue growth versus transaction growth, it improved in international to a 9 point spread from 13 last quarter and then in domestic it seemed to have sort of the other way it was about 6 points versus 3 last quarter. Maybe Scott, if you can help explain that?

Scott T. Scheirman

Sure, sure. On -- let me start just macrolly with the overall the C2C business that, what -- we saw some narrowing of the spread would primarily be currency from that standpoint, so on the international business it would have been currency. The other factors that relate to, say, geographic mix with intra-pricing, all those type of things, those differences have been relatively consistent the last couple of quarters.

On the domestic business, there was a little bit of widening of the spread. We did do some selective price reductions in the Q3, excuse me, in the Q1 and Q2 timeframe that took more of a full impact as we went into the third quarter. And clearly on October 1st, we just did a repositioning of the domestic business but there was some smaller earlier pricing reductions that we did in domestic that had some of that difference. But again, our goal with domestic is to continue to drive growth there and position that business to continue to gain share.

Darrin Peller - Barclays Capital

All right. Thanks. Real quick lastly, how have the banks kind of been performing with regard to, I know you touched on it earlier but USB, Fifth, I mean, has the transaction volume been comparable to other agents, have the sizes been comparable? And then lastly, is there any chance for another large kind of bank sign-up in the near-term?

Christina A. Gold

Well, I mean, what we''ve seen so far we are very pleased what we are seeing from the banks, obviously, we talked quite a bit overtime about Scotia Bank becoming 2% of Canadian revenue, now doubling itself in the second year. We''re very pleased with the ramp up of U.S. Bank. Right now they''re at retail and we''re hoping to be able to go account-to-cash when U.S. Bank is ready to do that.

Fifth Third is just being rolled out as would we speak, so again, another opportunity. We''re seeing really good numbers. We’re seeing -- on the first year of operation about 50% of the customers are new to our business and new to the franchise, so that''s really incrementality which is very good. So we have a lot of high hopes and a lot of positive opportunities with the expansion in the banking channel. It''s now 10% of Canadian U.S. locations and we expect to expand that overtime.

Darrin Peller - Barclays Capital

Okay. Thanks, guys.

Scott T. Scheirman

Thanks, Darrin.

Christina A. Gold
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