Western Union 2013 Annual Report Download - page 4

We also continued to expand our options for sending or
receiving money, with more transactional websites,
mobile money transfer services, and capabilities to
move money directly to or from a bank account in cer-
tain countries.
At the end of 2013, we offered our services at more
than 100,000 ATMs across the world. We now have 19
active mobile money transfer connections in 17 coun-
tries, wu.com transactional sites in more than 20 coun-
tries, and customers can use our mobile app in the U.S.
and Australia to send money around the globe. In addi-
tion, we have agreements with more than 75 banks to
offer our account-based money transfer service.
We continued to add strategic new agent relationships
last year, including Banorte in Mexico, Alexandria Bank
in Egypt, Riyad Bank in Saudi Arabia, and Walgreens
in the U.S. We also renewed and expanded our agree-
ment with La Banque Postale in Europe, one of our
largest agents.
Consumer-to-consumer transactions increased 5% for
the year, with 9% growth in the fourth quarter. Revenue
declined 3%, as expected, primarily due to the pricing
actions we began in late 2012. Electronic channels deliv-
ered strong growth, with revenue increasing 25% for the
year, representing 5% of our overall revenue in 2013.
Increasing customers and usage in
business-to-business
We’re also listening to small- and medium-sized enterprises
(SMEs), which have different—but equally important—
needs than consumers.
Last year, we introduced a variety of new products and
services, including a new cash management dashboard
tool for SMEs, new services for non-governmental
organizations and options and forwards products in addi-
tional markets.
We significantly expanded our services in India and
Japan, and we increased offerings for cross-border
tuition payments in several countries, including China,
India and South Korea.
These services contributed to a 7% revenue increase in
our Business Solutions segment last year, and allowed
us to meet some of the real and growing needs of
our customers to better manage their cash flows and
foreign-currency exposures.
Business Solutions now offers cross-border payments
in 32 countries and represented 7% of our overall reve-
nue in 2013.
Generating and deploying strong cash flow for
shareholders
One of the great qualities of our business model is our
ability to generate strong cash flow. Although 2013
was an investment year, with pricing, compliance and
other strategic investments, the company once again
generated more than $1 billion of cash flow from oper-
ating activities.
In 2013, Western Union returned $671 million to share-
holders through share repurchases and dividends.
Our commitment to customers and society
We are listening to our customers in other ways, too.
We continue to implement compliance and fraud-
prevention enhancements around the world to pro-
tect our customers and their hard-earned money. We
believe this commitment will make us stronger over the
long term.
We also are committed to giving back to the communi-
ties where our services are offered. In 2013, the Western
Union Foundation gave approximately $8 million to
causes supporting education and disaster-relief efforts
around the world.
The future
We remain focused on executing our strategic priorities to
return our business to stronger revenue and profit growth.
We will continue to be proactive—anticipating, adapting
to and addressing the ever-changing needs of our cus-
tomers, always striving to stay one step ahead.
In 2014, this means continuing to strengthen our con-
sumer money transfer business, with an emphasis on
digital expansion, to drive strong growth in Business
Solutions, and to generate and deploy strong cash flow
for our shareholders.
We have a clear vision and a solid foundation for growth.
We have millions of loyal customers. And, we have
passionate, hard-working colleagues around the globe.
We are focused on executing our vision and creating
long-term value for our shareholders.
Thank you for your commitment to Western Union and,
most importantly, to our customers!
HIKMET ERSEK
President, Chief Executive Officer and Director
April 2, 2014