Intermex Expands into New Territories amidst Decreased Growth in Q1 2024 Mexico
Intermex, the LatAm-focused remittances player, has announced its Q2 2024 results, showcasing a shift in customer behaviour and a strong liquidity position despite industry headwinds.
The integration of La Nacional, another remittances player, in the previous year resulted in a fourfold increase in Intermex's EBITDA, boosting its Q1 2024 adjusted EBITDA margin to 16.9%. However, the company's Q2 2024 revenue expectation is approximately $161.1 million, reflecting a 6.1% year-over-year decline. The adjusted EBITDA for the quarter is projected to be about $28.8 million, marking a 7.4% year-over-year decrease.
Transaction volumes declined 7.8% year-over-year to 14.1 million transactions, but the average principal per transaction increased by 5.0% to $441, indicating a shift towards customers sending larger amounts per transaction. Net income for Q2 2024 was $11.0 million with a diluted EPS of $0.37, also down from the previous year.
Despite the decline, Intermex's liquidity remained strong during this period, with $174.7 million in cash and cash equivalents. The company expects its FY 2024 adjusted EBITDA to be $124-127.7 million and its adjusted EBITDA margin to be around 18.2%.
Intermex's FY 2024 revenue is anticipated to rise by 3-7% to $681-701.8 million. Notably, the company achieved revenue highs in ten countries, although specific details for Q2 2024 were not provided. Digital revenues for Intermex rose by 59.1% in Q1 2024, underscoring the growing importance of digital remittances.
The Q2 2024 revenue expectations range from $171.5 million to $176.8 million, representing a 1.4-2.5% increase. The projected adjusted EBITDA for the quarter is between $31.7 million and $32.7 million, while the anticipated EBITDA margin for Q2 2024 is 18.5%.
These Q2 2024 results set the stage for Intermex’s ongoing performance before its 2025 acquisition by Western Union. The company's mixed performance trends, with top-line softness but some offset from higher average transaction amounts, highlight the challenges and opportunities in the remittances industry.
Intermex's strong liquidity position, despite the decline in Q2 2024 revenue, might be attributed to strategic business decisions and smart financial management within the industry. The projected increase in digital revenues indicates a potential shift towards digital business models in the remittances sector.
