• The Money Transfer business continued its acceleration with revenue reaching $304.9 million, up 20%, or 16% on a constant currency basis, driven by 20% transaction growth
• Money Transfer reported all-time highs for transactions and volume (total principal sent)
• The Money Transfer business showed strength compared to second quarter 2019 as revenue increased 8% and transactions grew 17%  
• MGO's strong financial performance in the second quarter led to a record quarter for customers, transactions, volume and revenue on the backdrop of record performance a year ago
• Total Money Transfer revenue for MGO increased to $47.0 million representing a 66% year-over-year growth
• Year-over-year, cross-border online revenue continued to grow at an accelerated pace increasing 68% with transactions growing an equally impressive 62%
• Active cross-border customer growth continued its strong momentum increasing 54%
• Total digital, which includes MGO, continued its robust performance reporting year-over-year transaction growth of 44% in the second quarter
• Digital revenue reached a new all-time high of $67.9 million for the second quarter based on an astounding 47% year-over-year revenue growth rate
• Digital partnership transactions delivered a solid 16% year-over-year growth rate over the significant surge experienced in the second quarter of 2020
• Digital partnerships transactions compared to the pre-COVID second quarter of 2019 grew a remarkable 89%
• Transactions received into accounts, cards and mobile wallets increased 78% year-over-year
• Digital transactions accounted for 33% of all money transfer transactions at the end of the second quarter

• Total revenue of $329.3 million increased 18% on a reported basis or an increase of 13% on a constant currency basis
• Money transfer revenue was $304.9 million, up 20%, or 16% on a constant currency basis, driven by 20% transaction growth
• Investment revenue was $2.0 million for the quarter representing a decline of $2.3 million due to lower prevailing interest rates
• Gross Profit was $151.6 million an increase of $24.7 million driven by the strength of money transfer revenue
• Total operating expenses were $129.7 million, an increase of $24.8 million or 24% including:
• Transaction and Operations Support expenses increased $19.0 million or 89% which was driven by:
• The elimination of the $8.8 million incentives generated in the second quarter of 2020 due to the termination of the commercial agreement with Ripple
• Reinstatement of certain operating expenses meaningfully impacted during the pandemic
• Compensation and Benefits were $59.0 million, an increase of $5.8 million driven by restructuring and certain employee related expenses impacted by COVID in the prior year
• Operating Income was $21.9 million, which was flat compared to last year
• Net loss of $11.1 million partly driven by a one-time $10.3 million debt extinguishment expense related to the Company's prepayment of $100.0 million of second lien debt
• Diluted loss per share was $0.13 and diluted adjusted earnings per share was $0.01
• Adjusted EBITDA decreased 3% to $54.8 million, or 12% on a constant currency basis
• Adjusted EBITDA was 22% higher year-over-year excluding the $8.8 million Ripple incentives and investment income in the second quarter of 2020

• Cash and cash equivalents was $117.0 million at quarter-end compared to $130.6 million at  the end of the second quarter 2020
• Second quarter interest expense was $22.5 million and capital expenditures were $10.0 million
• During the quarter the Company raised net proceeds of $97.6 million from an equity offering which were used to pay down a portion of its second lien debt
• In July, the Company completed its debt refinancing raising $400 million in a senior secured Term Loan due 2026 at an interest rate of L + 425 and $415 million in a senior secured bond issuance due 2026 at 5.375%.  The Company also has an undrawn $32.5 million revolving credit facility due 2025.  This refinancing will reduce annual cash interest expense by approximately $36 million.

Participant Dial-In Numbers:

U.S.:

1-800-458-4121

International:

1-929-477-0324

Webcast:

public.viavid.com/index.php?id=145821

Replay:

U.S 1-844-512-2921 or International 1-412-317-6671

Replay ID:

3760279

Replay is available through Friday, August 6, 2021, 11:59 p.m. ET

• the impact of the COVID-19 pandemic or future pandemics on our business, including the potential for work stoppages, lockdowns, shelter-in-place, or restricted movement guidelines, service delays, lower consumer and commercial activity;
• our ability to compete effectively;
• our ability to maintain key agent or biller relationships, or a reduction in business or transaction volume from these relationships, including with our largest agent, Walmart, through its introduction of additional competing white label money transfer products or otherwise;
• our ability to manage fraud risks from consumers or agents;
• the ability of us and our agents to comply with U.S. and international law and regulations;
• litigation and regulatory proceedings involving us or our agents and other commercial relationships, which could result in material settlements, fines or penalties, revocation of required licenses or registrations, termination of contracts, other administrative actions or lawsuits and negative publicity;
• current and proposed regulations addressing consumer privacy and data use and security;
• our ability to successfully develop and timely introduce new and enhanced products and services and our investments in new products, services or infrastructure changes;
• our ability to manage risks associated with our international sales and operations, including exchange rates among currencies;
• our offering of money transfer services through agents in regions that are politically volatile or, in a limited number of cases, that may be subject to certain OFAC restrictions;
• changes in tax laws or unfavorable outcomes of tax positions we take, or a failure by us to establish adequate reserves for tax events;
• our high degree of leverage and substantial debt service obligations, and our ability to comply with the requirements under our debt agreements;
• major bank failure or sustained financial market illiquidity, or illiquidity at our clearing, cash management and custodial financial institutions;
• the ability of us and our agents to maintain adequate banking relationships;
• a security or privacy breach in systems, networks or databases on which we rely;
• weakness in economic conditions, in both the U.S. and global markets;
• a significant change, material slow down or complete disruption of international migration patterns;
• the financial health of certain European countries or the secession of a country from the European Union;
• our ability to manage credit risks from our agents and official check financial institution consumers;
• our ability to adequately protect our brand and intellectual property rights and to avoid infringing on the rights of others;
• our ability to manage risks related to the operation of retail locations and the acquisition or start-up of businesses;
• any restructuring actions and cost reduction initiatives that we undertake may not deliver the expected results and these actions may adversely affect our business;
• our capital structure; and
• the risks and uncertainties described in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of MoneyGram's public period reports filed with the U.S. Securities and Exchange Commission (the SEC), including MoneyGram's annual report on Form 10-K for the year ended December 31, 2020, and subsequent quarterly reports on Form 10-Q.

Table One

-

Condensed Consolidated Statements of Operations

Table Two

-

Segment Results

Table Three

-

Reconciliation of Certain Non-GAAP Measures to Relevant GAAP Measures - EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Free Cash Flow

Table Four

-

Reconciliation of Certain Non-GAAP Measures to Relevant GAAP Measures - Adjusted Net Income and Adjusted Diluted EPS

Table Five

-

Condensed Consolidated Balance Sheets

Table Six

-

Condensed Consolidated Statements of Cash Flows

CONTACTS

Investor Relations:

Media Relations:

214-979-1400

Stephen Reiff

InvestorRelations@moneygram.com

media@moneygram.com

TABLE ONE

MONEYGRAM INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(Amounts in millions, except percentages and
per share data)

Three Months Ended
June 30,

2021 vs

Six Months Ended
June 30,

2021 vs

2021

2020

2020

2021

2020

2020

REVENUE

Fee and other revenue

$

327.3

$

275.5

$

51.8

$

635.4

$

556.3

$

79.1

Investment revenue

2.0

4.3

(2.3)

4.0

14.4

(10.4)

Total revenue

329.3

279.8

49.5

639.4

570.7

68.7

Total revenue change, as reported

18

%

(14)

%

12

%

(11)

%

Total revenue change, constant currency

13

%

(13)

%

8

%

(10)

%

COST OF REVENUE

Commissions and other fee expense

161.3

141.4

19.9

311.2

284.6

26.6

Investment commissions expense

0.2

0.2

—

0.4

3.2

(2.8)

Direct transaction expense

16.2

11.3

4.9

31.4

19.5

11.9

Total cost of revenue

177.7

152.9

24.8

343.0

307.3

35.7

GROSS PROFIT

151.6

126.9

24.7

296.4

263.4

33.0

OPERATING EXPENSES

Compensation and benefits

59.0

53.2

5.8

121.2

106.6

14.6

Transaction and operations support ⁽¹⁾ 

40.3

21.3

19.0

83.7

59.3

24.4

Occupancy, equipment and supplies

16.3

14.2

2.1

31.8

29.1

2.7

Depreciation and amortization

14.1

16.2

(2.1)

29.4

33.3

(3.9)

Total operating expenses

129.7

104.9

24.8

266.1

228.3

37.8

OPERATING INCOME

21.9

22.0

(0.1)

30.3

35.1

(4.8)

Other expenses

Interest expense

22.5

22.7

(0.2)

44.8

46.5

(1.7)

Loss on early extinguishment of debt

10.3

—

10.3

10.3

—

10.3

Other non-operating expense

0.8

1.2

(0.4)

1.8

2.3

(0.5)

Total other expenses

33.6

23.9

9.7

56.9

48.8

8.1

Loss before income taxes

(11.7)

(1.9)

(9.8)

(26.6)

(13.7)

(12.9)

Income tax (benefit) expense

(0.6)

2.7

(3.3)

(0.1)

12.4

(12.5)

NET LOSS

$

(11.1)

$

(4.6)

$

(6.5)

$

(26.5)

$

(26.1)

$

(0.4)

Basic and diluted loss per common share

$

(0.13)

$

(0.06)

$

(0.07)

$

(0.32)

$

(0.34)

$

0.02

Basic and diluted weighted-average
outstanding common shares and equivalents
used in computing loss per common share

87.2

77.8

9.4

83.4

77.6

5.8

(1) The three and six months ended June 30, 2020 include Ripple market development fees of $15.1 million and $31.7 million, respectively, partially offset by related transaction and trading expenses of $6.3 million and $10.8 million, respectively.

TABLE TWO

MONEYGRAM INTERNATIONAL, INC.

SEGMENT RESULTS

(Unaudited)

Global Funds Transfer

(Amounts in millions, except
percentages)

Three Months Ended
June 30,

2021 vs

Six Months Ended
June 30,

2021 vs

2021

2020

2020

2021

2020

2020

Money transfer revenue

$

304.9

$

253.1

$

51.8

$

590.3

$

509.0

$

81.3

Bill payment revenue

10.4

10.8

(0.4)

21.2

24.2

(3.0)

Total revenue

$

315.3

$

263.9

$

51.4

$

611.5

$

533.2

$

78.3

Cost of revenue

$

177.5

$

152.7

$

24.8

$

342.6

$

304.0

$

38.6

Gross profit

$

137.8

$

111.2

$

26.6

$

268.9

$

229.2

$

39.7

Money transfer revenue change, as
reported

20

%

(10)

%

16

%

8

%

Money transfer revenue change,
constant currency

16

%

(9)

%

12

%

(7)

%

Financial Paper Products

(Amounts in millions, except
percentages)

Three Months Ended
June 30,

2021 vs

Six Months Ended
June 30,

2021 vs

2021

2020

2020

2021

2020

2020

Money order revenue

$

10.6

$

10.8

$

(0.2)

$

21.0

$

22.9

$

(1.9)

Official check revenue

3.4

5.1

(1.7)

6.9

14.6

(7.7)

Total revenue

$

14.0

$

15.9

$

(1.9)

$

27.9

$

37.5

$

(9.6)

Investment commissions expense

$

0.2

$

0.2

$

—

$

0.4

$

3.3

$

(2.9)

Gross profit ⁽¹⁾

$

13.8

$

15.7

$

(1.9)

$

27.5

$

34.2

$

(6.7)

⁽¹⁾ In periods of extremely low interest rates, it is possible for commissions to be close to zero, resulting in abnormally high gross margin.

TABLE THREE

MONEYGRAM INTERNATIONAL, INC.

RECONCILIATION OF CERTAIN NON-GAAP MEASURES TO RELEVANT GAAP MEASURES

EBITDA, ADJUSTED EBITDA, ADJUSTED EBITDA MARGIN AND ADJUSTED FREE CASH FLOW

(Unaudited)

(Amounts in millions, except percentages)

Three Months Ended
June 30,

2021 vs

Six Months Ended
June 30,

2021 vs

2021

2020

2020

2021

2020

2020

Loss before income taxes

$

(11.7)

$

(1.9)

$

(9.8)

$

(26.6)

$

(13.7)

$

(12.9)

Interest expense

22.5

22.7

(0.2)

44.8

46.5

(1.7)

Depreciation and amortization

14.1

16.2

(2.1)

29.4

33.3

(3.9)

Signing bonus amortization

14.7

12.6

2.1

29.0

25.1

3.9

EBITDA

39.6

49.6

(10.0)

76.6

91.2

(14.6)

Significant items impacting EBITDA:

Loss on early extinguishment of debt

10.3

—

10.3

10.3

—

10.3

Restructuring and reorganization costs

2.2

0.7

1.5

8.1

1.2

6.9

Stock-based, contingent and incentive
compensation

1.5

1.6

(0.1)

3.3

3.6

(0.3)

Direct monitor costs

1.1

3.1

(2.0)

4.9

7.9

(3.0)

Compliance enhancement program

0.2

1.2

(1.0)

1.3

3.2

(1.9)

Legal and contingent matters

(0.1)

0.2

(0.3)

—

0.6

(0.6)

Severance and related costs

—

—

—

0.2

0.2

—

Adjusted EBITDA

$

54.8

$

56.4

$

(1.6)

$

104.7

$

107.9

$

(3.2)

Adjusted EBITDA margin ⁽¹⁾

16.6

%

20.2

%

(3.6)

%

16.4

%

18.9

%

(2.5)

%

Adjusted EBITDA change, as reported

(3)

%

(3)

%

Adjusted EBITDA change, constant
   currency adjusted

(12)

%

(11)

%

Adjusted EBITDA

$

54.8

$

56.4

$

(1.6)

$

104.7

$

107.9

$

(3.2)

Cash payments for interest

(27.1)

(16.8)

(10.3)

(39.0)

(34.4)

(4.6)

Cash payments for taxes, net of
refunds

(1.5)

(0.4)

(1.1)

1.2

(2.5)

3.7

Cash payments for capital expenditures

(10.0)

(9.8)

(0.2)

(21.2)

(19.9)

(1.3)

Cash payments for agent signing
bonuses

(9.7)

(4.7)

(5.0)

(22.7)

(29.7)

7.0

Adjusted Free Cash Flow

$

6.5

$

24.7

$

(18.2)

$

23.0

$

21.4

$

1.6

(1) Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by total revenue.

TABLE FOUR

MONEYGRAM INTERNATIONAL, INC.

RECONCILIATION OF CERTAIN NON-GAAP MEASURES TO RELEVANT GAAP MEASURES

ADJUSTED NET INCOME AND ADJUSTED DILUTED EPS

(Unaudited)

Three Months Ended
June 30,

Six Months Ended
June 30,

(Amounts in millions, except per share data)

2021

2020

2021

2020

Net loss

$

(11.1)

$

(4.6)

$

(26.5)

$

(26.1)

Total adjustments ⁽¹⁾

15.2

6.8

28.1

16.7

Tax impacts of adjustments ⁽²⁾

(3.5)

(1.3)

(6.5)

(3.6)

Valuation allowance ⁽³⁾

—

—

1.0

10.1

Adjusted net income (loss)

$

0.6

$

0.9

$

(3.9)

$

(2.9)

Diluted loss per common share

$

(0.13)

$

(0.06)

$

(0.32)

$

(0.34)

Diluted adjustments per common share

0.14

0.07

0.27

0.30

Diluted adjusted earnings (loss) per common share

$

0.01

$

0.01

$

(0.05)

$

(0.04)

Diluted weighted-average outstanding common shares

    and equivalents

87.2

77.8

83.4

77.6

(1) See summary of adjustments in Table Three - EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Free Cash Flow.

(2) Tax rates used to calculate the tax expense impact are based on the nature and jurisdiction of each adjustment.

(3) Valuation allowance recorded for deferred tax assets existing at the beginning of the year.

TABLE FIVE

MONEYGRAM INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Amounts in millions, except share data)

June 30, 2021

December 31, 2020

ASSETS

Cash and cash equivalents

$

117.0

$

196.1

Settlement assets

3,607.2

3,702.9

Property and equipment, net

138.9

148.1

Goodwill

442.2

442.2

Right-of-use assets

54.3

55.1

Other assets

113.4

129.7

Total assets

$

4,473.0

$

4,674.1

LIABILITIES

Payment service obligations

$

3,607.2

$

3,702.9

Debt, net

766.1

857.8

Pension and other postretirement benefits

74.2

74.5

Lease liabilities

58.3

59.1

Accounts payable and other liabilities

135.4

216.8

Total liabilities

4,641.2

4,911.1

STOCKHOLDERS' DEFICIT

Common stock, $0.01 par value, 162,500,000 shares authorized,
91,153,786 and 72,530,770 shares issued, 90,613,561 and 72,517,539
shares outstanding at June 30, 2021 and December 31, 2020,
respectively

0.9

0.7

Additional paid-in capital

1,396.7

1,296.0

Retained loss

(1,501.9)

(1,475.3)

Accumulated other comprehensive loss

(60.2)

(58.4)

Treasury stock: 540,225 and 13,231 shares at June 30, 2021 and
December 31, 2020, respectively

(3.7)

—

Total stockholders' deficit

(168.2)

(237.0)

Total liabilities and stockholders' deficit

$

4,473.0

$

4,674.1

TABLE SIX

MONEYGRAM INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Six Months Ended June 30,

(Amounts in millions)

2021

2020

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss

$

(26.5)

$

(26.1)

Adjustments to reconcile net loss to net cash (used in) provided by operating
activities:

(18.2)

33.7

Net cash (used in) provided by operating activities

(44.7)

7.6

CASH FLOWS FROM INVESTING ACTIVITIES:

Payments for capital expenditures

(21.2)

(19.9)

Net cash used in investing activities

(21.2)

(19.9)

CASH FLOWS FROM FINANCING ACTIVITIES:

Principal payments on debt

(103.2)

(3.2)

Prepayment call premium

(4.0)

—

Proceeds from revolving credit facility

—

23.0

Payments on revolving credit facility

—

(23.0)

Net proceeds from stock issuance

97.6

—

Payments to tax authorities for stock-based compensation

(3.6)

(0.7)

Net cash used in financing activities

(13.2)

(3.9)

NET CHANGE IN CASH AND CASH EQUIVALENTS

(79.1)

(16.2)

CASH AND CASH EQUIVALENTS—Beginning of year

196.1

146.8

CASH AND CASH EQUIVALENTS—End of period

$

117.0

$

130.6