MoneyGram 2009 Annual Report Download - page 31

Table of Contents
RESULTS OF OPERATIONS
Table 1 — Results of Operations
2009 2008 2009 2008
vs. vs. vs. vs.
YEAR ENDED DECEMBER 31, 2009 2008 2007 2008 2007 2008 2007
($) ($) (%) (%)
(Amounts in thousands)
Revenue:
Fee and other revenue $ 1,130,893 $ 1,105,676 $ 949,059 $ 25,217 $ 156,617 2% 17%
Investment revenue 33,219 162,130 398,234 (128,911) (236,104) (80)% (59)%
Net securities gains (losses) 7,790 (340,688) (1,189,756) 348,478 849,068 NM NM
Total revenue 1,171,902 927,118 157,537 244,784 769,581 26% 489%
Fee commissions expense 497,105 502,317 410,301 (5,212) 92,016 (1)% 22%
Investment commissions
expense 1,362 102,292 253,607 (100,930) (151,315) (99)% (60)%
Total commissions
expense 498,467 604,609 663,908 (106,142) (59,299) (18)% (9)%
Net revenue (losses) 673,435 322,509 (506,371) 350,926 828,880 109% NM
Expenses:
Compensation and benefits 199,053 224,580 188,092 (25,527) 36,488 (11)% 19%
Transaction and operations
support 284,277 219,905 191,066 64,372 28,839 29% 15%
Occupancy, equipment and
supplies 47,425 45,994 44,704 1,431 1,290 3% 3%
Interest expense 107,911 95,020 11,055 12,891 83,965 14% 760%
Depreciation and
amortization 57,091 56,672 51,979 419 4,693 1% 9%
Valuation loss on embedded
derivatives — 16,030 — (16,030) 16,030 NM NM
Debt extinguishment loss — 1,499 — (1,499) 1,499 NM NM
Total expenses 695,757 659,700 486,896 36,057 172,804 5% 35%
Loss from continuing
operations before income
taxes (22,322) (337,191) (993,267) 314,869 656,076 93% 66%
Income tax (benefit) expense (20,416) (75,806) 78,481 55,390 (154,287) 73% NM
Loss from continuing
operations $ (1,906) $ (261,385) $ (1,071,748) $ 259,479 $ 810,363 99% 76%
NM = Not meaningful
Following is a summary of our operating results from continuing operations in 2009:
• Fee and other revenue increased 2 percent to $1,130.9 million in 2009 from $1,105.7 million in 2008, driven primarily by money
transfer transaction volume growth of 6 percent. As compared to growth of 18 percent in 2008, money transfer transaction volume
growth was lower in 2009 due primarily to the economic recession and our growing volume base.
• Investment revenue decreased $128.9 million, or 80 percent, in 2009 due to lower yields earned on our investment portfolio and a
decline in average investable balances from the termination of certain official check financial institution customers and money order
agents.
• Net securities gains in 2009 reflect a $7.6 million net gain from the call of two trading investments and the reversal of the related
put options. Valuation gains of $4.3 million on the put option related to the remaining
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