A Network of
Enablement
EURONET 2023 ANNUAL REPORT
CONTENTS
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Network Overview . . . . . . . . . . . . . . . . . . 2–3
Case Studies . . . . . . . . . . . . . . . . . . . . . . . . 4–7
Shareholder Letter . . . . . . . . . . . . . . . . . 8–9
Financial Highlights . . . . . . . . . . . . . . . . . .10
Financial Overview . . . . . . . . . . . . . . . . . . . 11
Business Segments
• EFT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
• epay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
• Money Transfer . . . . . . . . . . . . . . . . . . . . .14
Payments Platforms
• Ren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
• Dandelion. . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Executive Summary . . . . . . . . . . . . . . . . . .17
10-K Report. . . . . . . . . . . . . . . . . . . . . . 18–122
Reconciliation Table. . . . . . . . . . . . . . . . 123
Looking Forward. . . . . . . . . . . . . . . . . . . . 124
Office Locations/Currencies. . . . . . 124
Euronet | 2023 Annual Report
What’s common, however, is that all of them
are made possible through the power of
Euronet, a global company with a modern
payments network that can send and
receive funds in almost any currency to
virtually any location in real time using easy-
to-use, omnichannel applications.
This year’s annual report is a testament to
the power of our network, expanding further
into how it enables numerous use cases for
businesses and consumers to seamlessly
participate in the world’s economy through
simpler, faster and more secure payments.
Every day, millions of people
worldwide use Euronet’s network to
make payments. Yet, most probably
don’t understand how it enables this
important part of their lives.
To them, they are simply paying with a QR
code on their smartphone at the grocery
store or extracting cash from an ATM. They
might be sending money to their family in
another country or completing a payment
for inventory for their warehouse. Or, they
might be looking for entertainment by
purchasing a movie or video game on their
mobile device.
These transactions vary in amounts, the
methods by which they are delivered and
the reasons why they are executed in the
first place.
A Network of Enablement
1
A diverse network for limitless
payments and expansive growth
At Euronet, our network has been at the
heart of our business from the beginning,
nearly 30 years ago. Originally created
to support our thousands of ATMs
worldwide, our network now interacts
with financial institutions, digital wallets,
central banks, retailers, card and
alternative payment networks and other
key technologies of the global financial
infrastructure.
In recent years, we have added new
network capabilities and applications
to process the emerging requirements
of digital payments and meet the ever-
growing demand for these transactions
by businesses and consumers alike.
This latest expansion in our capabilities
has come naturally.
On the consumer side of transactions,
we are pioneers in moving physical
payments, such as mobile top-ups,
gift cards and remittances, to the
digital world. As the adoption of digital
payments has increased, we have
adapted our global network’s “behind-
the-scenes” technologies and the
solutions we provide to excel in the
digital payments landscape.
And now, while our cash network still
generates substantial revenue, our
technologies that support digital
payments are growing fast.
2Euronet | 2023 Annual Report Our Value:
Simple payments for a complex world
By their nature, payments
are complicated.
Successful transactions involve not only technology but also
relationships and connections to financial institutions, card
networks and other third parties such as retailers and brands.
Geographic distance adds
to the complexity.
Once payments cross borders, the number of potential third
parties, including foreign regulators and financial institutions,
increases and creates potential slowdowns or even roadblocks
with each connection.
A strategic, mature
payments network is
required to succeed.
The reach of a processor’s network, the depth of its relationships
and its adherence to technical standards such as ISO 20022,
KYC, 3DS, 2FA and others is paramount to a secure, transparent
and real-time transaction. The flexibility to deliver solutions
on premise at customer sites, through cloud providers and as
software-as-a-service (SaaS) solutions is also important.
Meanwhile, payers only
care about security and
simplicity.
When it comes time to pay, businesses and consumers
evaluate their needs and seek the most convenient method
whether it is cash, apps or digital wallets (QR codes, PINs,
biometrics), point-of-sale terminals, kiosks or web interfaces.
And yes, they expect the funds to settle fast.
Euronet meets the
requirements for delivering
the payments of today and
the future.
After nearly 30 years of providing fintech and payments
solutions, Euronet is the connective tissue between all the
parties required, using innovative technology to make simple,
secure and real-time global payments possible.
A Network of Enablement
3
Enabling people to pay
the way they want to pay
As a global payments company, Euronet
plays a pivotal role in the lives of millions
of people daily.
From a simple real-time Unified
Payments Interface (UPI) payment for a
cup of tea in India to a multimillion-dollar
transaction by a globally recognized
financial institution, our payment network
serves consumers’ and businesses’
diverse needs and aspirations.
Yet, the true power of our network lies
not merely in the transfer of funds but in
the tangible, life-enhancing outcomes
it creates, whether it be purchasing a
train ticket to reunite with a loved one,
celebrating with friends at a local pub,
or ensuring the financial needs of family
members far away are met.
Read on for examples of how our network
enables billions of daily transactions each
year across the world.
ENABLING MERCHANTS
Our merchant acquiring services enable
store owners and businesses to accept
and process customer payments using the
fastest and most secure methods. Along
with complementary offerings such as
point-of-sale devices, dynamic currency
conversion (DCC), currency exchange and
digital content provisioning, we offer our
acquiring services to various merchants
through our epay and EFT segments.
ENABLEMENT IN ACTION
We enable merchants to
accept payments:
• At the point of sale with cards
and from digital wallets using
QR codes or tokenized credit/
debit cards from Apple Pay
and Google Pay.
• Online through websites
and apps.
• On smartphones and kiosks
and in any location required
for points of sale beyond
physical retail stores, such
as in stadiums and parking
garages.
4
Euronet | 2023 Annual Report ENABLING DIGITAL REMITTANCES
Digital wallets enable individuals to store, send, and receive money,
make digital payments and access essential financial tools through
mobile devices. Digital wallets also help consumers overcome
traditional banking barriers and empower underbanked populations
with economic opportunities.
ENABLEMENT IN ACTION
Customers can deliver remittance payments
using the Ria Money Transfer and Xe apps and
websites or Ria’s worldwide locations to a family
member who has one of the billions of digital
wallet accounts (or billions of bank accounts)
connected to our Money Transfer network.
ENABLING REAL-TIME PAYMENTS
Real-time payments, where transactions are delivered and settled within minutes, offer
businesses increased efficiency through improved cash flow, increased fraud protection
and enhanced liquidity management. For consumers, real-time payments provide
similar benefits while giving unbanked individuals increased access to banking services
because of the large number of digital wallets connected to real-time payment networks.
ENABLEMENT IN ACTION
Euronet is entrenched in real-time payments projects, a
multibillion-dollar market worldwide. Some examples of our
real-time payment projects include:
• With central banks, our Ren payments platform is integral
to real-time payment networks in India, Mozambique and
Malaysia and a transcontinental project for Africa that will
eventually connect 1.3 billion people across 55 countries.
• Many banks need help connecting to real-time payment
networks because their legacy systems are incompatible
with the newer real-time payments protocol (ISO 20022).
Our Ren payments platform connects legacy banking
systems to real-time payment networks in cases like
this, enabling the bank to deliver real-time payment
experiences to their customers without having to “rip
and replace” their existing systems.
5
A Network of Enablement ENABLING CONTENT DISTRIBUTION
Our epay business segment has relationships with leading global brands, retailers and
digital wallets. Through these arrangements, epay distributes content from the brands,
such as movies, music, credits and games, to consumers through its network of physical
and digital retailers and digital wallet partners.
ENABLEMENT IN ACTION
epay delivers content through physical gift cards in retail stores worldwide and,
increasingly, through digital transactions. In both cases, epay covers all areas
of the user experience, from managing the production, inventory and display of
physical cards and e-codes to digital integrations into wallets and apps.
• In New Zealand, epay’s Gift Station features a
wide variety of physical gift cards from leading
brands inside the country’s most popular
retailers. The Gift Station concept, which is being
expanded to other countries, also includes a
website where the gift cards can be purchased.
• epay has integrated its catalog of third-party
branded content with popular digital wallets
Revolut (Europe) and Nubank (Brazil) and their
millions of users.
• In Germany, epay’s cadooz division offers gift
cards from more than 700 brands as part of its
incentive programs.
ENABLING CASH TO DIGITAL
In regions where cash is the primary form of payment, our EFT segment
delivers innovative services that provide convenience for consumers and
merchants and efficiency for the segment’s operations.
ENABLEMENT IN ACTION
In Europe and Asia Pacific, merchants can deposit their cash
from sales throughout the day into Euronet ATMs equipped
with cash recycling capabilities. The ATM deposits are
immediately available digitally in the merchants’ accounts,
sparing them from having to visit a bank branch. In addition,
the cash deposits reduce the number of times the EFT
segment must fill an ATM with new cash.
6
Euronet | 2023 Annual Report
ENABLING GLOBAL B2B PAYMENTS
With the rapid development of the global economy, many fintech
companies and large financial institutions are seeking solutions
for delivering cross-border, real-time payments to existing and
prospective customers. With business payments comprising
most of the multitrillion-dollar cross-border payments market,
a solution is only effective if the bank or fintech can land funds
at the payment destinations their customers want to reach,
which can be a challenge if their current networks are limited by
geography or regulations.
ENABLEMENT IN ACTION
In recent years, we’ve enhanced our Money Transfer network with
additional business payment capabilities, real-time payments delivery
in more countries and connections to billions of bank and digital wallet
accounts. Now known as our Dandelion payments network, it can be
integrated as a service by financial institutions and fintechs into their
applications through a highly configurable API.
ENABLING ISSUING
In the payments world, issuing is the process behind the functionality of credit,
debit and gift cards, and an issuer supports the technical infrastructure that
enables a company to generate and distribute these cards to its customers
effortlessly. Issuing includes open loop cards that require the issuer to have a
money license and can be used anywhere payment schemes such as Visa and
Mastercard are accepted or closed loop cards that do not need a money license
and are redeemable only with designated merchants.
ENABLEMENT IN ACTION
Issuing is a core service Euronet provides across our company. Some examples
of the latest issuing projects include:
• In Latin America, our Ren payments platform provides issuing through a software
as a service (SaaS) model for Banco Pichincha, Ecuador’s largest private bank.
• In Malaysia, our Ren payments platform expands the Touch ‘n Go eWallet’s suite
of offerings with the addition of its own prepaid Visa card. The digital wallet‘s
user base of more than 20 million users now has the option to expand its payment
acceptance to more than 200 countries and territories.
• Our EFT segment provides card issuing from our global data centers for financial
institutions in Europe, Africa and Asia Pacific.
• In epay, issuing includes the segment’s open loop Prezzy card and SaaS-based
gift card programs and issuing solutions for leading brands such as Netflix, Apple
and Sony managed by the Conductor platform as well as solutions developed by
the epay team.
A Network of Enablement
7
SHAREHOLDER LETTER
A culture of growth powers Euronet into its 30th year
Greetings, and welcome to another edition of
our annual report.
On behalf of our nearly 10,000 employees
worldwide, I am eager to share another year of
our accomplishments and strong growth rates
in all areas of the company as we embark on
2024 — our 30th year of business.
This year’s report focuses on our network and
the many kinds of payments it enables for
businesses and consumers around the world.
When we talk about a “Network of Enablement,”
there are two main pieces to consider. First,
there are the invisible technical details our
network and payment technologies perform to
make these transactions work. While we are
proud of our capabilities in that area, we are
just as excited about the second part, which
is how our work translates to the real world in
connecting people and enriching their daily
lives through financial participation.
I witnessed this excitement first-hand on
several occasions in my visits to our offices
Total
Revenue
$3.7 B
Total Transactions
Processed
12.4 B
Total Bank Accounts
Reached
Total Funds Through
Our Network
4.1 B
$129 B
Total Mobile Wallet
Accounts Reached
2 B
Total Users
of the Xe App
110 M
Total ATMs
Owned and Operated
Total EFT
Point-of-Sale Terminals
Total epay
Point-of-Sale Terminals
52,652 656 K
821 K
As of 12/31/2023
8
worldwide, where I often find our employees
discussing and looking forward to the next
opportunities in their parts of the business.
I’ve seen it at all levels, including planned
meetings with our leadership and segment
teams and impromptu hallway discussions.
I even encountered it in our headquarters one
day when the roar from a sales meeting in a
conference room near my office reverberated
through the walls!
It might be easy to assume this happens in every
business. But, given the challenges of the past
few years, I don’t think this is as common as you
might think.
Throughout the year, I often meet with
business leaders across different industries
here in Kansas City and other parts of the
world. With lingering fallout from the COVID
pandemic, remote office work debates and
complex economic trends that seem to emerge
regularly, it has been a challenging time to
operate a business.
Euronet is not immune to these issues. While
we have had more highs than lows during this
period, I have always appreciated the resilience
of our people and the overall Euronet drive to
succeed. The backbone of our business is stable
and has developed through a nearly 30-year-
long history of consistently strong growth rates,
either at or near double-digit levels.
Or, as our Executive Vice President and Chief
Financial Officer Rick Weller said to a financial
analyst on a recent earnings call, “We don’t have
a bias for growth. We have a culture for growth.”
For more explanation, let me share a few
highlights from our business segments in 2023:
• In EFT, we saw an increase in our most
profitable transactions at the end of the year,
impressive growth in our merchant acquiring
business and geographic expansion in our
independent ATM network.
• In epay, we generated continued growth
in our core business, especially in digital
Euronet | 2023 Annual Report channels, through the development of new
solutions for our retail and content providers
that enable customers to purchase the
branded services they enjoy in the most
convenient way for them.
• In Money Transfer, we ended the year with
tremendous growth, including consecutive
quarters of double-digit operating margins,
while we continued to expand our physical
and digital networks.
• As for our technology platforms, we
continue to build momentum in our digital
payment initiatives as we sign more Ren
and Dandelion deals.
While our growth culture has been instrumental
in our success this year, another large factor is
the continued diversification of our business.
For many years, our ever-expanding global
ATM estate meant we were primarily viewed
as a company dependent solely on the cash
economy. Perhaps true at one time, it certainly
is no longer the case, considering the growth
of our digital payment initiatives in all three
business segments and the adoption of our
payments platforms in the market.
In a recent earnings call, we shared that,
in 2019, 58% of our EBITDA was in the EFT
segment, and all that was ATM revenue. Now,
about four years later, ATMs represent just a
third of our business overall because of the
growth of our other businesses.
Considering the number of flights in 2024 is
expected to reach 98% of pre-COVID levels
while industry surveys indicate the majority
of Europeans will increase or maintain their
travel budget, our firm belief is that our cash
business will continue to grow and be profitable.
However, we are just as optimistic about our
opportunities in the digital payments world,
where we are growing quickly in several areas
and see continued expansion for all three of
our segments.
As I close, I must reminisce as Euronet enters its
30th year of business. We have come a long way,
from a single ATM in Budapest, Hungary, in 1994
to powering a global financial infrastructure
today, with numerous other accomplishments
along the way. What a journey it has been!
I am proud of the many things we have
accomplished during this time. In summary,
our original mission of increasing financial
participation on a global level and enabling
people to pay the way they want to pay has been
brought to life. More than words, our actions,
powered by our culture of growth, have built an
ever-growing, diverse company that is built to
serve the needs of our customers now and well
into the future.
Thank you, and best wishes for 2024!
Michael J. Brown
Chairman, CEO and President
Euronet
9
A Network of Enablement FINANCIAL HIGHLIGHTS
2023 At-a-glance
2023
2022
2021
2020
2019
2023
2022
2021
2020
2019
2023
2022
REVENUE
($ BILLIONS)
ADJUSTED
OPERATING
INCOME*
($ MILLIONS)
DILUTED
EARNINGS (LOSS)
PER SHARE
($ DOLLARS)
TOTAL
EQUITY
($ MILLIONS)
$3.69
$3.36
$2.99
$2.48
$2.75
$432
$385
$223
$153
$474
ADJUSTED
EBITDA
($ MILLIONS)
2023
2022
2021
$395
2020
$302
$619
$565
$607
TRANSACTIONS
(MILLIONS)
2019
2023
2022
2021
2020
2019
2023
2022
2021
2020
2019
2023
2022
2021
2020
2019
12,424
10,443
7,625
5,796
4,710
$7.46
$6.51
$3.69
$2.82
$7.01
$5,894
$5,404
$4,744
$4,927
$4,658
$5.50
$4.41
ADJUSTED
CASH EARNINGS
PER SHARE*
($ DOLLARS)
$6.31
$1,250
$1,244
$1,256
$1,446
$1,579
TOTAL
ASSETS
($ MILLIONS)
2021
$1.32
2020
$(0.06)
2019
2023
2022
2021
2020
2019
* On page 123, we have defined adjusted operating income, adjusted EBITDA and adjusted earnings per share terms and provided a reconciliation of these non-GAAP financial measures to their
most directly comparable U.S. GAAP financial measure.
Note: We believe that adjusted operating income, adjusted EBITDA and adjusted earnings per share provide useful information to investors because they are indicators of the strength and
performance of our ongoing business operations. While certain of these calculations are used more fully to describe the results of the business, others are commonly used as a basis for
investors, analysts and credit rating agencies to evaluate and compare the operating performance and value of companies within the payment processing industry.
10
Euronet | 2023 Annual Report FINANCIAL OVERVIEW
Long-term investments in network and technologies
lead to record full-year adjusted EPS
We delivered exceptional results in 2023,
generating record annual consolidated revenue
of $3.7 billion, which included revenue growth in
all three segments despite European economic
headwinds and Croatia’s conversion to the euro,
which impacted our full-year EFT results.
This strong revenue growth resulted in record
full-year adjusted earnings per share of $7.46,
a 15% year-over-year increase.
The strength of these record top- and bottom-
line results is due to our investments across the
business over the past three decades to create
a product and geographically diverse company
that can withstand external pressures outside
our control.
Our EFT segment continued to see a recovery
in tourists across the business, but growth was
muted by economic concerns driven by higher
fuel prices and wage recovery that had not yet
caught up to inflation. These challenges were
met by strong growth in our point-of-sale (POS)
acquiring business and growth in markets
outside Europe.
In epay, we continued to see strong double-
digit growth rates in our core epay content
distribution business despite fewer promotional
campaigns from our retail partners in 2023
compared with the prior year.
And, in Money Transfer, we continued to take
market share and expand our physical and digital
business to more markets and channels.
As has been the case in the last few years, all
of this was possible because of the strength
of our balance sheet, which has allowed us to
invest in new products and technology across
the business to drive future growth. The balance
sheet and our positive cash flow also allowed us
to reinvest in the company in the form of $379
million in share repurchases during 2023.
As we moved through the fourth quarter, we
were pleased to see resilience in our most
profitable EFT transactions. We also saw
continued growth in markets outside of Europe,
2023 Segment Economics
REVENUE AND ADJUSTED EBITDA MIX
The following charts represent the Revenue and
Adjusted EBITDA profiles of each segment.
Revenue Mix*
2023 Revenue* | $3,695.9 M
42% 29% 22% 7%
Money
Transfer
epay
EFT ATMs
EFT Other
Adjusted EBITDA Mix*
2023 Adjusted EBITDA* | $649.9 M Percent Margin | 18%
33% 21% 34% 12%
Money
Transfer
14%
Margin
epay
EFT ATMs
EFT Other
12%
Margin
21%
Margin
7%
Margin
* Revenues, Adjusted EBITDA & Percent Adjusted EBITDA Margin by segment excludes
eliminations and expenses incurred by corporate services.
the POS acquiring business and our core
business in epay. These factors, combined with
the further expansion in Money Transfer, give us
great optimism for continued growth in 2024.
Throughout our nearly 30-year history, we
have focused on developing a network of
access points, products and solutions that are
secure and easy to use, enabling customers to
send and receive payments and access their
money using preferred methods. This unique
combination of our network, product portfolio,
technical solutions, and geographic footprint
differentiates us from our competitors and
allows us to weather economic shifts.
In conclusion, we were pleased to see growth
across all segments with improving profit
margins as 2023 ended. We believe our growth
trajectory and margin results, particularly in the
fourth quarter, provide ample momentum for
another robust year in 2024.
11
A Network of Enablement BUSINESS SEGMENTS — EFT
EFT: Resilience and strategic expansion powers strong
performance in 2023
In 2023, our Electronic Funds Transfer (EFT)
segment navigated through macroeconomic
challenges and capitalized on opportunities,
showcasing resilience and strategic foresight
in expanding its network and services. The
segment ended the year
with a 15% increase in
revenue, 12% increase
in operating income and
8% increase in EBITDA
compared to 2022.
In navigating conditions in the global economy,
EFT welcomed a near-return to pre-COVID
levels of travel during the first half of the year.
However, inflation increased the prices of
airfare, hotels, restaurants, entertainment
venues and other services. As a result, tourists,
especially Europeans traveling within Europe,
spent less at their destinations.
This pressure on ATM usage proved to be
temporary as ATM withdrawal rates continued
to improve through the end of the year.
Headed into 2024, all indicators point to easing
inflation, lower travel costs and improving
wage trends, which drive our optimistic outlook
for our ATM fleet.
EFT also delivered on two other strategic
initiatives during the year involving its
independent ATM network (IAD).
The first was an optimization of the IAD, where
the profitability of each ATM was analyzed.
As a result, unprofitable ATMs were removed,
and many were redeployed to new profitable
sites. Throughout 2024, EFT expects to see
a temporary net reduction in installed ATMs,
resulting in slightly less revenue but increased
profits and margins.
Second, EFT expanded its IAD to new countries
with deployments in Belgium and Mexico. This
gives EFT ATMs in 32 European countries and
38 countries worldwide. The expansion follows
other recent new IAD deployments in Europe
(Iceland, the Baltics, Norway and Montenegro),
Northern Africa (Morocco and Egypt) and
Southeast Asia (Malaysia and the Philippines).
Our EFT revenue accounts for more than the
money made at ATMs, including fees we collect
from banks that outsource their ATM operations
and value-added services at point-of-sale (POS)
terminals and ATMs, such as dynamic currency
conversion (DCC) and tax-free shopping.
EFT also made significant strides in its cash
deposit network, which empowers merchants
and consumers to deposit cash into our ATMs,
effectively converting cash into digitally
available funds. Notably, EFT recorded $7 billion
in deposits in Poland in 2023 and expanded
capabilities in other regions such as Romania.
This expansion underscores EFT’s commitment
to providing accessible and efficient financial
services, particularly where cash transactions
remain prevalent.
EFT has further expanded the Piraeus Bank
POS acquiring business in Greece that
Euronet purchased in 2022, accelerating its
diversification initiatives to include advanced
solutions for the cashless economy.
Through consistent marketing, brand awareness
campaigns and delivery of competitive products,
EFT added thousands of merchants each quarter
and increased the overall revenue of the POS
business by 15% in the fourth quarter of 2023
compared to the prior year. The POS business
also expanded beyond Greece into Spain and
Portugal at the end of the year.
In summary, EFT’s performance in 2023
reflects a balanced approach of expansion,
optimization, and resilience in the face of
economic challenges. The growth in cash deposit
networks, merchant acquiring business, and IAD
network expansion, coupled with strategic ATM
network optimization, increased travel levels,
and improving economic conditions, positions
EFT for continued success.
2023 EFT Results
Revenue
$1,058.3 M
Operating Income
$206.3 M
Adjusted Operating Income
$205.8 M
Adjusted EBITDA
$300.4 M
Transactions
8,473 M
12
Euronet | 2023 Annual Report BUSINESS SEGMENTS — EPAY
epay: Segment expands core content distribution business
while diversifying product portfolio
epay delivered strong results in 2023 by
expanding content distribution to new markets
and retailers. In addition to this growth in epay’s
core business, the segment diversified its
product offerings to enable more customers to
purchase the branded services they enjoy in the
most convenient manner possible.
The segment expanded its content distribution
portfolio and footprint by introducing Microsoft
365 renewals in Spain, Netherlands, Germany,
and Australia, reflecting a global commitment
to diversifying product offerings.
The launch of Alipay+ in Australia, Disney+
digital in Austria and Airbnb in Belgium
demonstrated efforts to extend digital
content distribution to new markets, as did
the expansion of the Sony Digital Code Server
technology platform. Initially catering to the
US and Latin American markets, this platform
now serves Europe and Asia, presenting an
opportunity for global-scale transactions and
digital content distribution.
While epay is recognized as a leading distributor
of mobile top-up and prepaid branded content,
the company’s strategic investment in
becoming a leading solutions provider was
also successful throughout the year.
For example, the introduction of an online gift
card marketplace for Nubank in Brazil, a similar
project to one epay delivered in India for Google
Pay, showcases the versatility and global
scalability of epay’s technology.
Further demonstrating product diversity, epay
continued progressing with its software as a
service (SaaS) platforms, Conductor and Skylight.
Conductor, part of epay’s gift card management
and issuing solutions, was adopted by a leading
company in the anime space and is also being
used to distribute Google Workspace at a large
U.K. electronics retailer. Skylight, a SaaS-
based platform for managing compliance
programs and fraud detection at money
services businesses,
gained significant traction
throughout the year, built a
solid pipeline and closed its
first landmark deals as 2023
ended.
Finally, epay saw rapid adoption of its branded
products with the expansion of the Prezzy
prepaid card into India on the Rupay network,
following Prezzy’s addition to New Zealand’s
digital sales channels. This open-loop gift card
can be used for online purchases as well as
loaded into Apple Pay and Google Pay wallets
and used for purchases wherever these wallets
are accepted.
epay also offers prepaid cards under the Gift
Station brand in Australia and Greece and the
YouChoose brand in the United Kingdom. Also,
in the UK in 2023, epay launched eSimChoice, a
service that enables travelers to save on mobile
roaming charges by choosing data bundles from
more than 200 countries and regions worldwide.
For the year, epay increased revenues by 8%,
operating income by 5% and adjusted EBITDA
by 5%.
2023 was characterized by notable
achievements, with the epay team demonstrating
adaptability to changing customer habits
and strategic foresight for its partners. The
company’s commitment to global expansion,
diversified business offerings, and strategic
partnerships positions the segment well for
continued success in its competitive markets.
2023 epay Results
Revenue
$1,082.4 M
Operating Income
$126.2 M
Adjusted EBITDA
$133.1 M
Transactions
3,789 M
13
A Network of Enablement BUSINESS SEGMENTS — MONEY TRANSFER, RIA AND XE
Money Transfer: Rapid expansion results in most strategic
real-time payments network in the world
$3.69
Our Money Transfer segment contributed a
2023
strong year of growth to Euronet’s bottom line,
$3.36
including back-to-back quarters of operating
2022
income and adjusted EBITDA growth of 20% or
2021
higher to end 2023. For the year, Money Transfer
$2.99
2020
2019
$2.48
increased total revenues
by 8%, operating income by
20% and adjusted EBITDA
by 15%.
$2.75
Money Transfer accom-
plished this strong
$385
$223
$432
2023
performance while continuing to invest in
expanding its network, which has been a critical
2022
driver in the segment’s growth. Expansion has
been a long-term focus over the last decade,
2021
and the Money Transfer network is now the
most strategic real-time payments network
2020
in the world when considering its geographic
2019
reach and how it enables people to pay and
receive money however they want, using cash
or digital options.
$474
$153
In an impressive year of network growth, the
$5.50
2023
Money Transfer network ended 2023 with
connections to 2 billion digital wallet accounts,
2022
4.1 billion bank accounts, and 580,000 physical
2021
locations across 198 countries and territories.
$4.41
$1.32
$(0.06)
Also, at year’s end, the reach of Money
2020
Transfers’ bank deposits extended to countries
2019
comprising nearly 95% of the world’s GDP. Real-
time account deposits through the network
accounted for almost 60% of the world’s
GDP, while consumer and business payment
2023
capabilities reached more than 92%.
$1,250
$6.31
$1,244
2022
Although account deposit growth rates
have surpassed cash pickup for many years,
$1,256
2021
principal transfers to digital accounts
represented only 20% of our total volume by
$1,446
2020
the end of 2019 compared to 39% in the fourth
quarter of 2023. For the entire year, growth
2019
rates for account deposits accelerated at a
34% rate versus 17% in 2022.
$1,579
2023 Money Transfer
Results
Revenue
$1,555.2 M
Operating Income
$185.4 M
Adjusted EBITDA
$216.4 M
Transactions
161.7 M
14
2023
2022
$619
In addition, Money Transfer launched 97
correspondent banks and payment partners,
43% more than the segment activated in the
previous year. This included the launch of 29
new correspondents in 25 countries in the
fourth quarter alone, its best quarter of the year.
$302
$565
$395
2020
2021
2019
Ria and Xe have licenses to send money in
$607
markets representing approximately 63% of
the global market, making further geographic
expansion in 2024 possible.
2023
2022
10,443
Partnership additions to the network in 2023
12,424
included notable names such as Alipay, the
leading digital wallet in China, which was added
in the first quarter. Other additions throughout
the year included Whish (550 branch locations
in Lebanon), Flash (an extensive network of
200,000 kiosks in South Africa), and the Dana
Mobile Wallet (100+ million users in Indonesia),
among many others.
5,796
7,625
4,710
2020
2021
2019
2023
2022
One of the factors in Money Transfer’s financial
performance and network expansion was a
$7.46
revised marketing strategy that positioned the
segment for substantial customer acquisition
and more efficient deployment of marketing
dollars. Those efforts led to an acceleration
in digital growth, generating three months of
record digital customer acquisitions at the end
of the year, with each month surpassing the
previous month’s increase.
$2.82
$3.69
$6.51
$7.01
2020
2021
2019
2023
With improvements in customer satisfaction
and retention, the resources to consider
investment opportunities as they arise, a
$5,894
profitable digital channel, expanding network
and increasing bottom-line margins, Money
Transfer enters 2024 with momentum and
optimism.
$5,404
$4,744
2022
2021
2020
2019
$4,927
$4,658
Euronet | 2023 Annual Report PAYMENT SOLUTIONS — REN
Ren Payments Platform: Enhancements enable customers
to thrive in the evolving digital payments landscape
In the past year, Ren, Euronet’s robust payments
platform, strengthened its presence in the pay-
ments landscape, achieving notable successes
through innovations and experiences that met
the advancing requirements of customers in the
global digital payments market.
Ren’s traction in the market can be traced
back to its creation as an internal Euronet
platform for use across the company’s global
service offerings. Designed with a modern,
microservices-based, and cloud-ready
architecture, Ren was crafted to process the
diverse transactional and verification data from
various payment methods, including cash, cards,
QR codes, PINs, biometrics and other payment
forms collected from our global touchpoints.
In addition, Ren was engineered to meet our
card issuing requirements and process real-
time payments using the ISO 20022 protocol,
positioning it for seamless collaboration across
the entire spectrum of payments.
Once exclusively used for internal company
applications, Ren is now licensed to third parties
(financial institutions, digital banks, fintech
companies, etc.), who use it for a variety of
payment experiences for their customers,
including card issuing, acquirer processing, ATM
driving and as a payment hub for processing
instant and high-value/low-value payments. In
addition, Ren is used by central banks to process
real-time transactions in their national switches,
and member banks in these countries utilize Ren
to connect their legacy systems to real-time
payment networks.
Ren is offered as a software-as-a-service (SaaS)
offering across Euronet’s global data centers
as well as on-premise technology businesses
install in their data centers. Ren’s ability to
seamlessly integrate with existing hardware
and applications without needing extensive
replacements to legacy systems, coupled with
its flexible deployment options, provides the
freedom institutions in the banking and fintech
sectors seek.
Ren extended its customer journey in the
emerging markets of Asia and Africa with
institutions like Standard Chartered Bank, Grab,
Bank of the Philippine Islands and Sociedade
Interbancária de Moçambique (SIMO).
The Bank of the Philippine
Islands leveraged Ren’s
real-time payments
processing functionality to
power person-to-person
real-time payments,
person-to-biller payments and person-to-
merchant service in the bank’s digital wallet.
In Singapore, Ren provided a SaaS-based
card issuer processing platform for the digital
bank within Grab, a leading super app in Asia.
Following that success, Grab used Ren for
the same purpose in Malaysia. Additionally,
following a very successful first phase of
the national project to modernize payments
with SIMO in Mozambique, Ren will be used to
build a national QR code system to power daily
micropayments in the country.
After succeeding in these initial projects, Ren
expanded its presence in its current and new
markets, including LATAM and North America.
New clients in 2023 included Banco Guayaquil
(Ecuador), Banco Pichincha (Ecuador), Airtel
Payments Bank (India), Nium (Singapore), GXS
Bank (Singapore), Zenus Bank (Puerto Rico),
Tangent Solutions (the Philippines) and Security
Bank (the Philippines), among others.
Ren continues to be an important strategic
imperative for Euronet. While initial efforts
focused on establishing a solid foundation and
competitive parity, the path forward targets
differentiated experiences that enable Ren’s
customers to innovate and succeed. This
includes features such as intelligent payment
routing, chargeback optimization for acquirers
and AI-optimized rules engines. Given the many
opportunities ahead and the positive momentum
gained over the past year, the outlook for Ren in
2024 remains highly optimistic as it helps shape
the evolving global payments landscape.
15
A Network of Enablement PAYMENT SOLUTIONS — DANDELION
Dandelion Cross-Border Payments Platform: Accelerated flow
of new deals spans every region of the world
With its identity in the market established, the
Dandelion cross-border payments platform
gained significant momentum in 2023 with
expanded features and services and the signing
of several notable new deals.
Dandelion was formally
launched at the end of 2021
to address long-standing
challenges in cross-border
payments, particularly
for small- and medium-
sized businesses needing to send lower-value
payments. Incumbent cross-border payment
networks, such as SWIFT, have a history of
slow funds delivery and settlement with little
transparency in fees and limited ability to
trace or recall a payment as it moves through
correspondent banking networks.
Meanwhile, Euronet’s Money Transfer segment
has spent decades developing its network,
which today includes connections to more than
2 billion digital wallet accounts and 4.1 billion
bank accounts at the end of 2023. In addition to
digital transactions, the network has 580,000
total locations.
Though the Money Transfer network was
initially built for consumer-to-consumer
remittance payments, it was reimagined and
then repurposed as part of the Dandelion
initiative to be able to process business
payments, which represent the majority of
$156 trillion global cross-border payments
flows. In addition, Dandelion is easily accessed
by fintechs, banks, financial institutions, and
money service businesses via a modern and
highly configurable API.
Throughout 2022, a robust pipeline was built
as the new product gained a foothold in the
market through extensive marketing and sales
efforts. The Dandelion sales cycle can be
lengthy as intense compliance reviews of every
Dandelion partner are an essential precursor to
completing a deal and onboarding our partners.
Despite these challenges, the unequaled value
proposition of Dandelion and the Dandelion
team’s persistence was rewarded with its first
major deal at the end of 2022 with a global bank
that ranks as one of the 10 largest in the world.
2023 was marked by an accelerated flow of new
deals that spanned every region of the world
and included signed partners in its key target
verticals, including banks, fintechs, money
services businesses and payment service
providers. The growth of the Dandelion network
across more countries, banks, mobile wallets
and cash pickup locations, combined with
greater availability of pre-transaction account
validation and enhanced end-to-end payment
tracking capabilities, all contributed to its
sales success in 2023. The year ended with the
signing of the largest bank in Australia, which
was attracted to Dandelion’s ability to help it
compete for the outbound payments flow from
the country.
Moving into 2024, Dandelion will benefit from
the continued expansion of its leading real-time
cross-border payments network, rapid partner
integration through advanced APIs and new
value-added features. Dandelion will continue
to offer a compelling value proposition,
enabling it to gain additional market share in
the multitrillion-dollar market for global cross-
border payments.
16
Euronet | 2023 Annual Report EXECUTIVE SUMMARY
Executive Officers and Management
Michael J. Brown
Chairman, Chief Executive Officer and President
Rick L. Weller
Executive Vice President and Chief Financial Officer
Juan C. Bianchi
Executive Vice President and Chief Executive Officer,
Money Transfer Segment
Martin L. Brückner
Executive Vice President and Chief Technology Officer
Kevin J. Caponecchi
Executive Vice President and Chief Executive Officer,
epay, Software and EFT Asia Pacific Segment
Scott Claassen
General Counsel
Nikos Fountas
Executive Vice President and Chief Executive Officer,
EFT Americas, Europe, Middle East and Africa Division
Himanshu Pujara
Senior Vice President and Managing Director,
EFT Asia Pacific and Ren Payments
Tony Warren
Managing Director, Payments Software
Directors
Michael J. Brown
Chairman, Chief Executive Officer and President
Euronet Worldwide, Inc.
Paul S. Althasen
Co-founder
epay
Sara Baack
Founding Partner
Snowhawk, LP
Michael N. Frumkin
Retired Senior Director, Research
Google, Inc.
Thomas A. McDonnell
Retired President and Chief Executive Officer
DST Systems, Inc.
Dr. Andrzej Olechowski
Retired Professor
Vistula University, Warsaw, Poland
Andrew B. Schmitt
Retired Chairman and Chief Executive Officer
Layne Christensen Company
M. Jeannine Strandjord
Retired Senior Vice President
Sprint Corporation
Ligia Torres Fentanes
Retired Head of Asset Management for APAC and
Emerging Markets
BNP Paribas Group
Contact the Board of Directors
To report complaints about Euronet’s financial reporting,
internal control procedures, auditing matters or other
concerns to the Board of Directors or the Audit Committee,
write to:
Transfer Agent
Computershare Investor Services
P.O. Box 43078
Providence, RI 02940-3078 USA
computershare.com
Euronet Board of Directors
c/o The General Counsel
Euronet Worldwide, Inc.
11400 Tomahawk Creek Parkway, Suite 300
Leawood, KS 66211 USA
or send an email to directors@eeft.com.
Investor Information
Copies of Euronet Worldwide, Inc.’s Annual Report on Form
10-K, quarterly reports on Form 10-Q and current reports
on Form 8-K, are filed with the Securities and Exchange
Commission (SEC), and are available without charge
from Euronet Investor Relations, 11400 Tomahawk Creek
Parkway, Suite 300, Leawood, KS 66211 USA. In addition,
the Company’s Form 10-K and other filings with the
SEC are available at sec.gov or through our website at
euronetworldwide.com.
Corporate Headquarters
Euronet Worldwide, Inc.
11400 Tomahawk Creek Parkway, Suite 300
Leawood, KS 66211 USA
+1.913.327.4200
Stock Listing
U.S. NASDAQ: EEFT
17
A Network of Enablement 10-K
EURONET 2023 ANNUAL REPORT
18
Euronet | 2023 Annual Report
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
☑
ANNUAL REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended: December 31, 2023
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the transition period from to
Commission File Number
001-31648
EURONET WORLDWIDE, INC.
(Exact name of Registrant as specified in its charter)
________________________
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
Delaware
74-2806888
11400 Tomahawk Creek Parkway, Suite 300
Leawood, Kansas
(Address of principal executive offices)
66211
(Zip Code)
(913) 327-4200
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Common Stock
1.375% Senior Notes due 2026
Trading
Symbol(s)
EEFT
EEFT26
Name of Each Exchange on Which Registered
Nasdaq Global Select Market
Nasdaq Global Market
Securities registered pursuant to Section 12(g) of the Act: None
_________________________
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☑
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
A Network of Enablement
19
Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” ”accelerated filer,” “smaller reporting
company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Non-accelerated filer
☑
☐
Accelerated filer
Smaller reporting company
Emerging growth company
☐
☐
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. (cid:0)
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report. ☑
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the
registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based
compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☑
As of June 30, 2023, the aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant
was approximately $5.5 billion. The aggregate market value was determined based on the closing price of the Common Stock on June
30, 2023.
As of February 21, 2024, the registrant had 45,782,740 shares of Common Stock outstanding.
Documents Incorporated By Reference
Portions of the registrant’s Proxy Statement for its 2024 Annual Meeting of Stockholders, which will be filed with the Securities and
Exchange Commission no later than 120 days after December 31, 2023, are incorporated by reference into Part III of this Annual
Report on Form 10-K.
20
Euronet | 2023 Annual Report
TABLE OF CONTENTS
ITEM DESCRIPTION
PAGE
ITEM
NUMBER
PART I
ITEM 1.
BUSINESS ...........................................................................................................................................................................................................................
ITEM 1A. RISK FACTORS ..............................................................................................................................................................................................................
ITEM 1B. UNRESOLVED STAFF COMMENTS ............................................................................................................................................................
ITEM 1C. CYBERSECURITY RISK MANAGEMENT AND STRATEGY .................................................................................................
ITEM 2.
PROPERTIES .....................................................................................................................................................................................................................
ITEM 3.
LEGAL PROCEEDINGS ...........................................................................................................................................................................................
ITEM 4. MINE SAFETY DISCLOSURES .........................................................................................................................................................................
PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
ITEM 6.
AND ISSUER PURCHASES OF EQUITY SECURITIES .................................................................................................................
RESERVED .........................................................................................................................................................................................................................
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS ..........................................................................................................................................................................................................
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK .................................................
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA ................................................................................................
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE ...................................................................................................................................................................................
ITEM 9A. CONTROLS AND PROCEDURES ....................................................................................................................................................................
ITEM 9B. OTHER INFORMATION ..........................................................................................................................................................................................
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS .........................
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE ..............................................................
ITEM 11. EXECUTIVE COMPENSATION ........................................................................................................................................................................
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS .......................................................................................................................................
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
ITEM 14.
PRINCIPAL ACCOUNTING FEES AND SERVICES .........................................................................................................................
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES .........................................................................................................
22
37
50
50
52
52
53
53
54
54
71
73
115
115
116
116
116
116
116
116
116
117
SIGNATURES ...................................................................................................................................................................................................................
121
A Network of Enablement
21
ITEM 1. BUSINESS
PART I
References in this report to “we,” “our,” “us,” the “Company” and “Euronet” refer to Euronet Worldwide, Inc. and its subsidiaries
unless the context indicates otherwise.
General Overview
BUSINESS OVERVIEW
Euronet is a leader in electronic payment and transaction processing solutions for Financial Institutions, Retailers, Service Providers,
and Individual Consumers utilizing our global payments network, platforms, and technologies. Through a collection of diverse
technologies and services, our business segments and solutions meet a wide variety of payments requirements and process transactions
throughout the world. We move money in all the ways the world depends on. With a global footprint we provide compliant solutions
that make financial transactions easier, faster, and secure.
Core Business Segments
We operate in the following three segments as of December 31, 2023:
Electronic Funds Transfer (“EFT”) Segment
Our Electronic Funds Transfer (“EFT”) segment meets the needs of financial institutions and consumers through Euronet-owned and
outsourced Automated Teller Machines (“ATMs”) and Point-of-Sale (“POS”) terminals combined with value added and transaction
processing services. We deploy and operate our own ATMs, providing ATM services for financial institutions and providing
electronic payment processing solutions. EFT offers a suite of integrated electronic financial transaction software solutions for
electronic payment and transaction delivery systems. Transactions processed span a network of 47,303 ATMs, as of December
31,2023, and approximately 656,000 POS terminals. In 2023, the EFT Processing Segment accounted for approximately 29% of
Euronet’s consolidated revenues.
epay Segment
Our epay segment provides retail payment solutions and delivers innovative connections between the digital content of the world’s
leading brands and consumers. epay has one of the largest retail networks across Europe and Asia for the distribution of physical and
digital third-party content, including branded payments, mobile, and alternative payments, partnering with 1,000+ of the world’s
leading brands. In addition, through our own products, we have leveraged our technology to solve business challenges, delivering
scalable solutions to drive efficiency and effectiveness. Our comprehensive range of consumer products simplifies transactions and
provides financial convenience across a wide range of branded payments. epay operates in 60+ countries. We operate a network that
includes approximately 821,000 POS terminals that enable electronic processing of prepaid mobile airtime “top-up” services and other
digital media content. In 2023, the epay Segment accounted for approximately 29% of Euronet’s consolidated revenues.
Money Transfer Segment
Our Money Transfer segment provides global money transfers and currency exchange information in retail stores, apps, and websites
through Ria Money Transfer, Xe and the Dandelion cross-border real-time payments network. Euronet’s Money Transfer segment
offers real-time, cross-border payments to consumers and businesses across 198 countries and territories, enabling banks, fintechs and
big tech platforms to integrate an international payments solution into their own platforms. In 2023, the Money Transfer Segment
accounted for approximately 42% of Euronet’s consolidated revenues.
Ria Money Transfer, one of the largest consumer remittance companies in the world offers real-time international money transfers
with a special focus on emerging markets. In addition, Ria offers safe and affordable money transfers through a global network of cash
locations and online, serving over 20 million customers annually.
Xe offers web and app based currency information and industry-leading consumer and business cross border money transfer services.
Customers can send money, buy property overseas, and execute other international payments via the Xe website or app.
22
Euronet | 2023 Annual Report
Dandelion is a leading real-time cross-border payment platform; it offers consumer and business transaction processing and fulfillment
with alternative payout channels like bank accounts, cash pick-up and mobile wallets. Dandelion powers cross-border payments for
Xe and Ria, as well as third party banks, fintechs, and big tech platforms.
Historical Perspective
Euronet started in Central Europe in 1994 and has grown to become a global real-time digital and cash payments network with
millions of touchpoints today, With products and services in more than 200 countries and territories provided through its own brand
and branded business segments, Euronet and its financial technologies and networks offer payment transaction services. Euronet
serves clients from 67 offices worldwide.
For a discussion of operating results by segment, please see Item 7 – Management’s Discussion and Analysis of Financial Condition
and Results of Operations, and Note 18, Business Segment Information, to the Consolidated Financial Statements.
BUSINESS SEGMENT OVERVIEW
EFT PROCESSING SEGMENT
OVERVIEW
Our EFT Processing Segment provides comprehensive electronic payment solutions consisting of ATM cash withdrawal and deposit
services, ATM network participation, outsourced ATM and POS management solutions, credit, debit and prepaid card outsourcing,
card issuing and merchant acquiring services. In addition to our core business, we offer a variety of value-added services, including
ATM and POS DCC, domestic and international surcharge, foreign currency dispensing, advertising, digital content sales at ATMs,
Customer Relationship Management (“CRM”), prepaid mobile top-up, bill payment, money transfer, fraud management, foreign
remittance payout, cardless payout, banknote recycling solutions and tax-refund services. We provide these services either through our
Euronet-owned ATMs and POS terminals, through contracts under which we operate ATMs and POS terminals on behalf of our
customers or, for certain services, as stand-alone products. Through this segment, we also offer a suite of integrated electronic
financial transaction software solutions for electronic payment and transaction delivery systems.
SOURCES OF REVENUES
The primary sources of revenues generated by our ATM network are recurring monthly management fees, transaction-based fees,
surcharges, and margins earned on DCC transactions. We receive fixed monthly fees under many of our outsourced management
contracts. The EFT Processing Segment also generates revenues from POS operations and merchant management, card network
management for credit, debit, prepaid and loyalty cards, prepaid mobile airtime recharge and other electronic content on ATMs and
ATM advertising. We primarily operate across Europe, Africa, the Middle East, Asia Pacific, and the United States. As of December
31, 2023, we operated 47,303 ATMs compared to 45,009 at December 31, 2022.
We monitor the number of transactions made by cardholders on our network. These include cash withdrawals, balance inquiries,
deposits, prepaid mobile airtime recharge purchases, DCC transactions and certain denied (unauthorized) transactions. We do not bill
certain transactions on our network to financial institutions, and we have excluded these transactions for reporting purposes. The
number of transactions processed over our networks has increased over the last five years at a compound annual growth rate
(“CAGR”) of approximately 29.1% as indicated in the following table:
(in millions)
EFT Processing Segment transactions per year
2019
3,052
2020
3,275
2021
4,366
2022
6,459
2023
8,473
A Network of Enablement
23
The increase in transactions for the past few years is the result of a significant increase in the volume of lower value, digitally initiated
payment processing transactions for an Asia Pacific customer’s bank wallet and e-commerce site. The associated revenue of these
lower value, digitally initiated payment processing transactions is lower. As a result, our revenue growth will not correlate
proportionately with the increase in our transaction volume growth.
Our processing centers for the EFT Processing Segment are located in Germany, Hungary, India, China, and Pakistan. Our processing
centers run two types of proprietary transaction switching software: our legacy ITM software, which we have used and sold to
financial institutions since 1998 through our Software Solutions unit, and an innovative switching software package named “Ren”,
which is hosted in Germany and India, that was released in 2019. The processing centers operate 24 hours a day, seven days a week.
We have been progressively transitioning all of our networks to Ren.
EFT PROCESSING PRODUCTS AND SERVICES
Outsourced Management Solutions
Euronet offers outsourced management solutions to financial institutions, merchants, mobile phone operators and other organizations
using our processing centers’ electronic financial transaction processing software. Our outsourced management solutions include
management of existing ATM networks, development of new ATM networks, management of POS networks, management of
automated deposit terminals, management of credit, debit and prepaid card databases and other financial processing services. These
solutions include 24-hour monitoring of each ATM’s status and cash condition, managing the cash levels in each ATM, coordinating
the cash delivery, and providing automatic dispatches for necessary service calls. We also provide real-time transaction authorization,
advanced monitoring, network gateway access, network switching, 24-hour customer service, maintenance, cash settlement and
reconciliation, forecasting, and reporting. Since our infrastructure can support a significant increase in transactions, new outsourced
management solutions agreements should provide additional revenue with lower incremental cost.
Our outsourced management solutions agreements generally provide for fixed monthly management fees and, in most cases, fees
payable for each transaction. The transaction fees under these agreements are generally lower than those under card acceptance
agreements.
Euronet-Branded ATM Transaction Processing
Our Euronet-branded ATM networks, also known as IAD networks, are primarily managed by a processing center that uses our
market-leading internally developed software solutions. The ATMs in our IAD networks are able to process transactions for holders of
credit, debit and prepaid products issued by or bearing the logos of financial institutions and international card organizations such as
American Express®, Visa®, Mastercard®, JCB, Diners Club International®, Discover® and UnionPay International©, as well as
international ATM networks such as PLUS, CIRRUS and PULSE® or domestic networks such as NYCE, Shazam, AFFN, STAR and
others across North America. This is accomplished through our agreements and relationships with these institutions, international
credit, debit and prepaid card issuers, international card associations and domestic card associations.
When a bank cardholder conducts a transaction on a Euronet-owned ATM or automated deposit terminal, we receive a fee from the
cardholder’s bank for that transaction. The bank pays us this fee either directly or indirectly through a central switching and settlement
network. When paid indirectly, this fee is referred to as the “interchange fee.” We receive transaction processing fees for successful
transactions and, in certain circumstances, for transactions that are not completed because they fail to receive authorization. The fees
paid to us by the card issuers are independent of any fees charged by the card issuers to cardholders in connection with the ATM
transactions. In some cases, we may also charge a direct access fee or surcharge to cardholders at the ATM. The direct access fee is
added to the amount of the cash withdrawal and debited from the cardholder’s account.
We generally receive fees or earn margin from our customers for all types of ATM transactions:
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Euronet | 2023 Annual Report
Card Acceptance or Sponsorship Agreements
Our agreements with financial institutions and international card organizations generally provide that all credit and debit cards issued
by the financial institution or organization may be used at all ATMs that we operate in for a given market. In most markets, we operate
under sponsorship by our own e-money or payment service licensed entities. In some markets, we have agreements with a financial
institution under which we are designated as a service provider (which we refer to as “sponsorship agreements”) for the acceptance of
domestic cards and/or cards bearing international logos, such as Visa® and Mastercard®. These card acceptance or sponsorship
agreements allow us to receive transaction authorization directly from the card issuing institution or international card organizations
on a stand-in basis. Our agreements generally provide for a term of three to seven years and renew automatically unless either party
provides notice of non-renewal prior to the termination date. In some cases, the agreements are terminable by either party upon six
months’ notice. We are generally able to connect a financial institution to our network within 30 to 90 days of signing a card
acceptance agreement. The financial institution provides the cash needed to complete transactions on the ATM, but we provide a
significant portion of the cash to our IAD network to fund ATM transactions ourselves. Euronet is generally liable for the cash in the
ATM networks.
Under our card acceptance agreements, the ATM transaction fees we charge vary depending on the type of transaction and the number
of transactions attributable to a particular card issuer. Our agreements generally provide for payment in local currency, though
transaction fees are sometimes denominated in euros or U.S. dollars. Transaction fees are billed to financial institutions and card
organizations with payment terms typically no longer than one month.
Dynamic Currency Conversion
We offer dynamic currency conversion, or DCC, over our IAD networks, ATM networks that we operate on an outsourced basis for
financial institutions, and over financial institutions’ ATM networks or POS devices as a stand-alone service. DCC is a feature of the
underlying ATM or POS transaction that is offered to customers completing transactions using a foreign debit or credit card issued in
a country with a currency other than the currency where the ATM or POS is located. The customer is offered a choice between
completing the transaction in the local currency or in the customer’s home currency via a DCC transaction. If a cardholder chooses to
perform a DCC transaction, the acquirer or processor performs the foreign exchange conversion at the time that the funds are
delivered at an ATM or the transactions are completed through the POS terminal, which results in a pre-defined amount of the
customer’s home currency being charged to their card. Alternatively, the customer may have the transaction converted by the card
issuing bank, in which the amount of local currency is communicated to the card issuing bank and the card issuing bank makes the
conversion to the customer’s home currency.
When a customer chooses DCC at an ATM or POS device and Euronet acts as the acquirer or processor, we receive all or a portion of
the foreign exchange margin on the conversion of the transaction. On our IAD ATMs, Euronet receives the entire foreign exchange
margin. If Euronet is not the acquirer or processor of the transaction, we share the DCC revenue with the sponsor bank. On ATMs or
POS devices that are operated for financial institutions, or where we offer DCC as a stand-alone service to financial institutions or
merchants, we share the foreign exchange margin. The foreign exchange margin on a DCC transaction increases the amount Euronet
earns from the underlying ATM or POS transaction and supports deployment of additional ATMs in new locations.
Other Products and Services
Our network of owned or operated ATMs allows for the sale of additional financial and other products or services at a low incremental
cost. We have developed value-added services in addition to basic cash withdrawal and balance inquiry transactions. These value-
added services include mobile top-up, fraud management, bill payment, domestic and international surcharge, CRM, foreign
remittance payout, cardless payout, banknote recycling, electronic content, ticket and voucher, foreign currency withdrawal,
advertising and tax-refund services. We are committed to the ongoing development of innovative new products and services to offer
our EFT processing customers.
Euronet offers multinational merchants a Single European Payments Area (“SEPA”)-compliant cross-border transaction processing
solution. SEPA is an area in which all electronic payments can be made and received in euros, whether between or within national
boundaries, under the same basic conditions, rights, and obligations, regardless of the location. This single, centralized acquiring
platform enables merchants to benefit from cost savings and faster, more efficient payments transfer. Although many European
countries are not members of the eurozone, our platform can serve merchants in these countries as well, through our multi-currency
functionality.
A Network of Enablement
25
Software Solutions
We also offer a suite of integrated software solutions for electronic payments and transaction delivery systems. We generate revenues
for our software products from licensing, professional services and maintenance fees for software and sales of related hardware,
primarily to financial institutions around the world.
Ren Payments Platform
Ren was built from the ground up to operate in the evolving digital payments landscape of real-time settlements and emerging forms
of payment, including QR codes, PINs and biometrics. Ren primarily serves financial institutions, central banks and fintech
companies. It is offered as an on-premise technology where these businesses install the platform in their own data centers or as a
software as a service (SaaS) offering where development teams access it in Euronet’s global data centers using APIs. Versatile, Ren
can be used as a payment hub or to deliver core banking functionality such as issuing, merchant acquiring, transaction switching, and
ATM management. For real-time payments, Ren is used by central banks to process transactions and member banks that use Ren to
connect their legacy systems to real-time payment networks in their countries.
EFT PROCESSING SEGMENT STRATEGY
The EFT Processing Segment maintains a strategy to expand the network of ATMs and POS terminals into new and existing markets
that have the greatest potential for growth. We continue to focus on diversifying our business by expanding our market presence and
product portfolio, as well as outsourcing opportunities. In addition, we follow a supporting strategy to increase the penetration of value
added (or complementary) services across our existing customer base, including DCC, transaction-based fees, surcharge, cardless
payment, banknote recycling solutions, tax refund services, advertising, fraud management, bill payment, mobile top-up, CRM and
foreign remittance payout.
We continually strive to make our own ATM networks more efficient by removing unprofitable ATMs and redeploying them to new
profitable locations. We make selective additions to our own ATM network if we see market demand and profit opportunities. In
tourist locations, we also seasonally deactivate ATMs when tourist activity is low.
In recent years, the need for “all-in” services has increased. Banks, particularly smaller banks, are increasingly looking for integrated
ATM, POS and card issuing processing and management services. Euronet is well positioned for this opportunity as it can offer a full
end-to-end solution to potential partners.
Additional growth opportunities are driven through financial institutions that are receptive to outsourcing the operation of their ATM,
POS and card networks. The operation of these devices requires expensive hardware and software and specialized personnel. These
resources are available to us, and we offer them to our customers under outsourcing contracts. The expansion and enhancement of our
outsourced management solutions in new and existing markets will remain an important business opportunity for Euronet. Increasing
the number of non-owned ATMs and POS terminals that we operate under management services agreements and continued
development of our credit, debit and prepaid card outsourcing business could provide continued growth while minimizing our capital
investment.
In addition, complementary services offered by our epay Segment, where we provide prepaid mobile top-up services through POS
terminals, strengthens the EFT Processing Segment’s line of services. We plan to continue to expand our technology and business
methods into other markets where we operate and further leverage our relationships with mobile operators, other content providers and
financial institutions to facilitate that expansion.
SEASONALITY
Our EFT Processing business experiences its heaviest demand for cash withdrawals and DCC during the third quarter of the fiscal
year, coinciding with the tourism season. It is also impacted by seasonality during the fourth quarter and first quarter of each year due
to higher transaction levels during the holiday season and lower levels after the holiday season. This seasonality is increased due to
our practice of seasonally deactivating ATMs in tourist locations that experience significantly higher traffic during their peak tourist
seasons. Seasonally deactivating involves shutting down the ATMs during the slower months and results in lower overall transaction
volumes in the EFT Processing Segment during those months. As we have expanded our IAD network in tourist locations, the
financial impact of seasonally deactivating has increased, because we continue to bear the expense of seasonally deactivated ATMs
even though they do not generate transactions during the slower months.
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Euronet | 2023 Annual Report
SIGNIFICANT CUSTOMERS AND GOVERNMENT CONTRACTS
No individual customer of the EFT Processing Segment makes up greater than 10% of total consolidated revenues. EFT maintains
contract relationships with a number of banks, financial institutions, telecommunications companies, and clients whose ownership
includes the government.
COMPETITION
Our principal EFT Processing Segment competitors include ATM networks owned by financial institutions and national switches
consisting of consortiums of local banks that provide outsourcing and transaction services to financial institutions and independent
ATM deployers in a particular country. Additionally, large, well-financed companies that operate ATMs offer ATM network and
outsourcing services, and those that provide card outsourcing, POS processing and merchant acquiring services also compete with us
in various markets. Small local operators have also recently begun offering their services, particularly in the IAD market. None of
these competitors has a dominant market share in any of our markets. Competitive advantages in our EFT Processing Segment include
breadth of service offering, network availability and response time, price to both the financial institution and to its customers, ATM
location and access to other networks.
epay SEGMENT
OVERVIEW
We currently process and distribute prepaid mobile airtime and other electronic content and payment processing services for various
prepaid products, cards, and services on a network of approximately 821,000 POS terminals across approximately 352,000 retailer
locations in Europe, the Middle East and Africa, Asia Pacific, North America and South America. Our processing centers for the
epay segment are located in the United Kingdom, Germany, Italy, and the United States.
We have continued to expand our prepaid business in new and existing markets by drawing upon our depth of experience to build and
expand relationships with content providers, mobile operators, and retailers. We offer a wide range of products across our retail
networks, including prepaid mobile airtime, prepaid debit cards, prepaid gift cards, other prepaid electronic content such as music,
games and software, prepaid vouchers, transport payments and lottery, and bill payment processing assistance through partnerships
with various licensed money transmitters.
SOURCES OF REVENUES
The epay Segment generates commissions and processing fees from the distribution of electronic content from mobile operators and
other content providers. In 2023, approximately 67% of total revenues and approximately 74% of gross profit for the epay Segment
was from electronic content other than prepaid mobile airtime (digital media products).
Customers purchase digital media prepaid content as a gift or for self-use. Content is generally purchased in two ways: (1) directly
online from the content provider using an online payment method, or (2) through physical retail stores, online retailers, or other
electronic channels, including payment wallets, online banking, mobile applications, and other sources.
Customers using mobile phones generally pay for usage in one of two ways: (1) through ”postpaid” accounts, where usage is billed at
the end of each billing period, or (2) through “prepaid” accounts, where customers pay in advance by crediting their accounts prior
to usage.
Although mobile operators in the U.S. and certain European countries have provided service principally through postpaid accounts,
the norm in many other countries in Europe and the rest of the world is to offer wireless service on a prepaid basis.
Prepaid mobile phone credits are generally distributed using personal identification numbers (“PINs”). We distribute PINs in two
ways. First, we establish an electronic connection to the mobile operator and the retailer. When the sale to a customer is initiated, the
terminal requests the PIN from the mobile operator via our transaction processing platform. These transactions obtain the PIN directly
from the mobile operator. The customer pays the retailer, and the retailer becomes obligated to make settlement to us of the purchased
amount of the mobile airtime. We maintain systems that know the amount of mobile top-up sold by the retailer which allows us in turn
to bill that retailer for the mobile top-up sold.
A Network of Enablement
27
Second, we purchase PINs from the mobile operator which are electronically sent to our processing platform. We establish an
electronic connection with the POS terminals in retailer locations and our processing platform provides the terminal with a PIN when
the mobile top-up is purchased. We maintain systems that monitor transaction levels at each terminal. As sales of prepaid mobile
airtime to customers are completed, the inventory on the platform is reduced by the PIN purchased. The customer payment and
settlement with the retailer are the same as described above.
We expand our distribution networks by signing new contracts with retailers, and in some markets, by acquiring existing networks.
We continue to focus on growing our distribution network through independent sales organizations that contract directly with retailers
in their network to distribute prepaid mobile airtime or other digital media content from the retailers’ POS terminals. We continue to
increase our focus on direct relationships with chains of supermarkets, convenience stores, gas stations, and other larger scale retailers,
where we can negotiate multi-year agreements with the retailers. In addition to the sale of traditional mobile top-up volume described
above, we have expanded distribution into digital media products and other value-added services. We have leveraged our existing
technology infrastructure to sell digital media products, which have been sold through our traditional retail network and new retailer
networks such as digital channels. In the U.S., most prepaid digital media content is purchased for gifting; in markets outside the U.S.,
consumers generally purchase prepaid digital media content for self-use.
epay PRODUCTS AND SERVICES
Prepaid Mobile Airtime Transaction Processing
We process prepaid mobile airtime top-up transactions on our international POS network for two types of clients: distributors and
retailers. Both types of client transactions start with a consumer in a retail store. The retailer uses a specially programmed POS
terminal in the store, the retailer’s electronic cash register (ECR) system, or web-based POS device that is connected to our network to
buy prepaid mobile airtime. The consumer will select a predefined amount of mobile airtime from the carrier of choice, and the
retailer enters the selection into the POS terminal. The consumer will pay that amount to the retailer (in cash or other payment
methods accepted by the retailer). The POS device then transmits the selected transaction to our processing center. Using the
electronic connection we maintain with the mobile phone operator or drawing from our inventory of PINs, the purchased amount of
mobile airtime will be either credited to the consumer’s account or delivered via a PIN printed by the terminal and given to the
consumer. In the case of PINs printed by the terminal, the consumer must then call the mobile phone operator’s toll-free number to
activate the purchased airtime to the consumer’s mobile account.
One difference in our relationships with various retailers and distributors is the way in which we charge for our services. For
distributors and certain very large retailers, we charge a processing fee. However, the majority of our transactions occur with smaller
retailers. With these clients, we receive a commission or discount on each transaction that is withheld from the payments made to the
mobile phone operator, and we share that commission/discount with the retailers.
Closed Loop Gift Cards
Closed loop (private-branded) gift cards are generally described as merchant-specific prepaid cards, used for purchases exclusively at
a particular merchant’s locations. We distribute closed loop gift cards in various categories, including dining, retail, and digital media,
such as music, games, and software. Generally, the gift card is activated when a consumer loads funds (with cash, debit or credit card
payment) or purchases a preloaded value gift card at a retail store location or online.
Open Loop Gift Cards
Open loop gift cards are prepaid gift cards associated with an electronic payment network (such as Visa® or Mastercard®) and are
honored at multiple, unaffiliated locations (wherever cards from these networks are generally accepted). They are not merchant-
specific. We distribute and issue single-use, non-reloadable open loop gift cards carrying the Visa® brand in our retail channels. After
the consumer purchases the preloaded value gift card at a retail store location or online, the consumer must call the toll-free number on
the back of the card to activate it.
Open Loop Reloadable
We distribute Visa® and Mastercard® issued debit cards provided by card issuers. We also manage and distribute a proprietary debit
card that allows a retailer to issue its own reloadable store-branded card. Open loop reloadable cards have features similar to a bank
checking account, including direct deposit, purchasing capability wherever a credit card is accepted, bill payment and ATM access.
Fees are charged to consumers for the initial load and reload transactions, monthly account maintenance and other transactions.
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Euronet | 2023 Annual Report
Other Products and Services
Our POS network is used for the distribution of other products and services, including games and software, bill payment, lottery
tickets and transportation products. Through our Cadooz subsidiary, we also distribute vouchers and physical gifts into the business-
to-business (“B2B”) channel principally for the purposes of employee and customer incentives and rewards, as well as POS
promotions where physical goods are sold in large retailers. In certain locations, the terminals used for prepaid services can also be
used for electronic funds transfer to process credit, debit, and prepaid card payments for retail merchandise. We provide promotion
and advertising for content providers of their prepaid content throughout our retail distribution network. We also provide card
production and processing services to some of our prepaid gift card partners and telecom content providers.
Retailer and Distributor Contracts
We provide our prepaid services through POS terminals or web-based POS devices installed in retail outlets or, in the case of major
retailers, through direct connections between their ECR systems and our processing centers. In markets where we operate proprietary
technology, we generally own and maintain the POS terminals. In certain countries in Europe, the terminals are sold to the retailers or
to distributors who service the retailer. Our agreements with major retailers for POS services typically have one to three-year terms.
These agreements include terms regarding the connection of our networks to the respective retailer’s registers or payment terminals or
the maintenance of POS terminals, and obligations concerning settlement and liability for transactions processed. Generally, our
agreements with individual or small retailers have shorter terms and provide that either party can terminate the agreement upon three
to six months’ notice.
The number of transactions processed on our POS networks have increased over the last five years at a CAGR of approximately
25.2% as indicated in the following table:
(in millions)
epay processing transactions per year
epay SEGMENT STRATEGY
2019
1,542
2020
2,395
2021
3,120
2022
3,836
2023
3,789
Mobile top-up transactions are declining in many developed markets and transaction fees for mobile transactions are being
compressed by the mobile operators. epay’s strategy is to defend margins in developing markets by providing value-added services to
mobile operators and to decrease our reliance on mobile top-up by increasing distribution of other electronic content, expanding epay-
own branded content, introducing new solutions to new and existing customers, and focusing on geographic expansion. Strategic
execution behind expansion of digital media electronic content includes the development of relationships with global consumer
product brands. This strategy leverages the global scale of the epay business allowing global brands to be sold in many or all the
countries in which we have a presence. Examples of global brands we distribute include iTunes, Google Play, Sony, and Microsoft.
Telecommunications companies and other content providers have a substantial opportunity to increase revenues by diversifying the
products and services currently offered to their retailers. epay is deploying additional content through its POS network to retailers and
distributors all over the world. The reach, capabilities, and quality of the epay network are appealing as a global distribution channel.
We are one of the largest worldwide multi-country operators, and believe we have a distinct competitive advantage with the existing
relationships that we maintain with prepaid content providers and retailers.
SEASONALITY
As the product mix continues to change, the epay business is impacted by seasonality during the fourth quarter and first quarter
of each year due to the higher transaction levels during the holiday season and lower levels following the holiday season.
SIGNIFICANT CUSTOMERS AND GOVERNMENT CONTRACTS
No individual customer of our epay Segment makes up greater than 10% of total consolidated revenues. epay maintains contract
relationships with a number of companies, banks, post offices and telecommunications providers whose ownership includes
the government.
A Network of Enablement
29
COMPETITION
We face competition in the prepaid business in all of our markets. We compete with a few multinational companies that operate in
several of our markets. In other markets, our competition is from smaller, local companies. The mobile operators in all of our markets
have retail distribution networks, and in some markets, on-line distribution of their own through which they offer top-up services for
their own products.
We believe our size and market share are competitive advantages in many markets. In addition, we believe our processing platforms
are a competitive advantage. We have extremely flexible technical platforms that enable us to tailor POS solutions to individual
retailers and mobile operator and digital media content provider requirements where appropriate. Our platforms are also able to
provide value added services other than processing, which makes us a more valuable partner to the content providers and retailers.
We have introduced new digital products into the marketplace such as digital payment for online media subscriptions. Many of these
products are not offered by our competitors and in many countries, these are new products. We are capitalizing on being the first to
market for these products.
The principal competitive factors in the epay Segment include price (that is, the level of commission paid to retailers for each
transaction), breadth of products and up-time offered on the system. Major retailers with high volumes can demand a larger share of
the commission, which increases the amount of competition among service providers. We are seeing signs that some mobile operators
are expanding their distribution networks to provide top-up services on-line or via mobile devices, which provides other alternatives
for consumers to use.
MONEY TRANSFER SEGMENT
OVERVIEW
transfer services
We provide global money transfer services primarily under the brand names Ria, xe and dandelion. Ria provides consumer-to-
consumer money
locations and via our website
riamoneytransfer.com. We send money transfers from approximately 136 countries, with money transfer delivery completed in 175
countries. The initiation of a consumer money transfer occurs through retail agents, Company-owned stores or online, while the
delivery of money transfers can occur with bank correspondents, retailer agents or from certain ATMs. Our websites, and mobile
wallet apps, allow consumers to send funds online, using a bank account or credit or debit card, for pay-out directly to a bank account
or for cash pickup.
through a global network of more
than 580,000
In addition, we provide global account-to-account money transfer services under the brand name xe. We offer money transfer services
via our website (www.xe.com) and xe app and through customer service representatives. Xe also provides foreign currency exchange
information on its currency data websites (www.xe.com and www.x-rates.com). Through xe, we offer cash management solutions and
foreign currency risk management services to small-and-medium-sized businesses.
Lastly, under the brand “Dandelion”, Ria offers payment processing services to third-party partners. Dandelion is a leading real-time,
global cross-border payment platform; it offers consumer and business transaction processing and fulfillment with alternative payout
channels like bank accounts, cash pick-up and mobile wallets. Dandelion powers cross-border payments for xe, Ria, as well as third
party banks, fintechs, and big tech platforms.
We monitor the number of transactions made through our money transfer networks. The number of transactions processed on our
network has increased over the last five years at a CAGR of approximately 9.0% as indicated in the following table:
(in millions)
Money transfer transactions per year
2019
114.5
2020
116.5
2021
135.1
2022
147.9
2023
161.7
Our sending agent network includes a variety of agents, including Walmart, large/medium size regional retailers, convenience stores,
bodegas, multi-service shops and phone centers, which are predominantly found in areas with a large immigrant population. Each Ria
money transfer transaction is processed using Euronet’s proprietary software system and checked for security, completeness and
compliance with federal and state regulations at every step of the process. Senders can track the progress of their transfers through
Ria’s customer service representatives, and funds are delivered quickly to their beneficiaries via our extensive payout network, which
includes large banks and non-bank financial institutions, post offices and large retailers.
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Euronet | 2023 Annual Report
We are one of the largest global money transfer companies measured by revenues and transaction volumes. Our Money Transfer
Segment processed approximately $64.9 billion in money transfers in 2023.
SOURCES OF REVENUES
Revenues in the Money Transfer Segment are primarily derived through the charging of a transaction fee, as well as a margin earned
from purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates.
Sending agents and receiving agents for consumer-to-consumer products each earn fees for cash collection and distribution services.
Euronet recognizes these fees as direct operating costs at the time of sale.
MONEY TRANSFER PRODUCTS AND SERVICES
Money transfer products and services are sold primarily through the following channels: at agent locations, Company-owned stores,
mobile apps, TeleRia phone, and on internet enabled devices at riamoneytransfer.com and xe.com. In an online transaction, customers
send funds, using a bank account or credit or debit card, for pay-out at most of our agent locations around the world or directly to a
bank account.
In addition to money transfers, Ria also offers customers bill payment services, payment alternatives such as money orders,
comprehensive check cashing services for a wide variety of issued checks, along with competitive foreign currency exchange services
and mobile top-up. Our bill payment services offer timely posting of customer bills for over 8,800 companies, including electric and
gas utilities and telephone/wireless companies. These services are all offered through our Company-owned stores while select services
are offered through our agents in certain markets.
Under the brand “Dandelion”, Ria offers payment processing services to third party partners. The Dandelion cross-border payments
platform provides financial institutions, fintechs such as digital wallets and banks, and enterprise software companies access
to Euronet’s money transfer network through an API connection. This enables these companies to build financial solutions with real-
time payment capabilities to the more than 550,000 cash locations, and more than 6 billion bank and digital wallet accounts
the Euronet money transfer network reaches.
Xe offers an account-to-account international payment service to high-income individuals and small-and-medium sized businesses,
complementing our existing consumer-to-consumer money transfer business. Xe has a multi-channel platform which allows customers
to make transfers, track payments and manage their international payment activity online or through a customer service representative.
Xe offers cash management solutions and foreign currency risk management services to small-and-medium sized businesses. Xe also
offers foreign currency exchange subscriptions and advertising on its websites.
MONEY TRANSFER SEGMENT STRATEGY
The Money Transfer Segment’s strategy is to increase the volume of money transfers processed by leveraging our existing banking
and merchant/retailer relationships to expand our agent and correspondent networks in existing corridors. In addition, we pursue
expansion into high-potential money transfer corridors from the U.S. and internationally beyond the traditional U.S. to Mexico
corridor. Further, we expect to continue to take advantage of cross-selling opportunities with our epay and EFT Processing Segments
by providing prepaid services through our stores and agents and offering our money transfer services at select prepaid retail locations
and ATMs we operate in key markets. We will continue to make investments in our systems to support this growth. Additionally, we
are expanding our xe business into new markets.
SEASONALITY
Our money transfer business is significantly impacted by seasonality that varies by region. In most of our markets, we experience
increased money transfer transaction levels during the month of May and in the fourth quarter of each year, coinciding with various
holidays. Additionally, in the U.S. to Mexico corridor, we usually experience our heaviest volume during the May through October
time frame, coinciding with the increase in worker migration patterns and various holidays, and our lowest volumes during the
first quarter.
A Network of Enablement
31
SIGNIFICANT CUSTOMERS AND GOVERNMENT CONTRACTS
No individual customer of our Money Transfer Segment makes up greater than 10% of total consolidated revenues. The Money
Transfer Segment maintains correspondent relationships with a number of financial institutions whose ownership includes
governments of the correspondents’ countries of origin.
COMPETITION
Our primary competitors in the money transfer and bill payment business include other large money transfer companies and electronic
money transmitters, together with hundreds of smaller registered and unregistered money transmitters, as well as certain major
national and regional banks, financial institutions, and independent sales organizations. Our competition includes The Western Union
Company, the leading competitor with revenue approximately two times greater than our revenue. The Western Union Company has a
significant competitive advantage due to its greater resources and access to capital for expansion. This may allow them to offer better
pricing terms to customers, agents, or correspondents, which may result in a loss of our current or potential customers or could force
us to lower our prices. In addition to traditional money payment services, new technologies are emerging that compete with traditional
money payment services, such as stored-value cards, debit networks, web-based services, mobile apps, and digital currencies. Our
continued growth also depends upon our ability to compete effectively with these alternative technologies.
EMPLOYEES
We had approximately 10,000, 9,500 and 8,800 employees as of December 31, 2023, 2022, and 2021, respectively. We believe our
future success will depend in part on our ability to continue to recruit, retain and motivate qualified management, technical and
administrative employees. Currently, no union represents any of our employees, except in one of our Spanish subsidiaries. We
experienced no work stoppages or strikes by our workforce in 2023 and we consider relations with our employees to be good.
GOVERNMENT REGULATION
As discussed below, many of our business activities are subject to regulation in our current markets. In the Money Transfer Segment,
we are subject to a wide variety of laws and regulations of the U.S., individual U.S. states and foreign governments. These include
international, federal, and state anti-money laundering and sanctions laws and regulations, money transfer and payment instrument
licensing laws, escheat laws, laws covering consumer privacy, data protection and information security and consumer disclosure and
consumer protection laws. Our operations have also been subject to increasingly strict requirements intended to help prevent and
detect a variety of illegal financial activity, including money laundering, terrorist financing, unauthorized access to personal customer
data and other illegal activities. The more significant of these laws and regulations are discussed below. Noncompliance with these
laws and requirements could result in the loss or suspension of licenses or registrations required to provide money transfer services
through retail agents, Company owned stores, mobile apps or online. For more discussion, see Item 1A – Risk Factors.
Any further expansion of our activity into areas that are qualified as “financial activity” under local legislation may subject us to
licensing and we may be required to comply with various conditions to obtain such licenses. Moreover, the interpretations of bank
regulatory authorities as to the activity we currently conduct might change in the future. We monitor our business for compliance with
applicable laws or regulations regarding financial activities.
Certain of our European product offerings, including in particular, our money transfer services, merchant acquiring and bill payment
products, are regulated payment services requiring a license under the Second Payment Services Directive, or PSD2.
PSD2 requires a license to perform certain defined “payment services” in a European Economic Area (“EEA”) Member State and
such license may be extended throughout other Member States of the EEA through passporting of the license (either on a freedom of
service or freedom of establishment basis). Conditions for obtaining the license include minimum capital requirements, establishment
of procedures for safeguarding of funds, and certain governance and reporting requirements. In addition, certain obligations relating to
internal controls and the conduct of business, in particular, consumer disclosure requirements and certain rules regarding the timing
and settlement of payments, must be met. We have payment institution licenses in the U.K., France, Germany, and Spain and are
complying with these requirements. We passported our U.K., German, and Spanish payment services authorizations to several EEA
Member States. As a result of Brexit, our U.K, payment institution is no longer capable of passporting its license into the EEA and the
relevant EEA business was transferred to our other licenses prior to the end of the Brexit transition period. Additionally, in the U.K.,
we have obtained an e-money license. The e-money license allows Euronet to issue e-money and provide the same payment services
as a PSD2 licensee. The e-money license imposes certain requirements similar to those of the payment services license, including
minimum capital requirements, consumer disclosure and internal controls.
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Euronet | 2023 Annual Report
MONEY TRANSFER AND PAYMENT INSTRUMENT LICENSING
Licensing requirements in the U.S. are generally driven by the various state banking departments regulating the businesses of money
transfers and issuances of payment instruments. Typical requirements include the meeting of minimum net worth requirements,
maintaining permissible investments (e.g., cash, agent receivables, and government-backed securities) at levels commensurate with
outstanding payment obligations and the filing of a security instrument (typically in the form of a surety bond) to offset the risk of
default of trustee obligations by the license holder. We are required by many state regulators to submit ongoing reports of licensed
activity, most often on a quarterly or monthly basis, that address changes to agent and branch locations, operating and financial
performance, permissible investments, and outstanding transmission liabilities. These periodic reports are utilized by the regulator to
monitor ongoing compliance with state licensing laws. A number of major state regulators also conduct periodic examinations of
license holders and their authorized delegates, generally with a frequency of every one to two years. Examinations are most often
comprehensive in nature, addressing both the safety and soundness and overall compliance by the license holder with regard to state
and federal regulations. Such examinations are typically performed on-site at the license holder’s headquarters or operations center;
however, certain states may choose to perform examinations off-site as well.
Money transmitters, issuers of payment instruments and their agents are required to comply with U.S. federal, state and/or foreign
anti-money laundering laws and regulations. In summary, our Money Transfer Segment, as well as our agent network, is subject to
regulations issued by the different state and foreign national regulators who license us, the Office of Foreign Assets Control
(“OFAC”), the Bank Secrecy Act as amended by the USA PATRIOT Act (“BSA”), the Financial Crimes Enforcement Network
(“FINCEN”), as well as any existing or future regulations that impact any aspect of our money transfer business.
A similar set of regulations applies to our money transfer businesses in most of the foreign countries in which we originate
transactions. These laws and regulations include monetary limits for money transfers into or out of a country, rules regarding the
foreign currency exchange rates offered, as well as other limitations or rules for which we must maintain compliance.
Regulatory bodies in the U.S. and abroad may impose additional rules on the conduct of our Money Transfer Segment that could have
a significant impact on our operations and our agent network. In this regard, the U.S. federal government has implemented U.S.
federal regulations for electronic money transfers, including the Electronic Fund Transfer Act, which provides consumer protections
for international remittance transfers. The Consumer Financial Protection Bureau (“CFPB”), adopted a rule that provides additional
protections for consumers who transmit money internationally, including disclosure requirements, cancellation rights and error
resolution procedures for consumer complaints. Under U.S. federal law, it is unlawful for any provider of consumer financial products
or services to engage in unfair, deceptive, or abusive acts or practices (collectively, “UDAAPs”). The CFPB has rule making and
enforcement authority to prevent UDAAPs in connection with transactions for consumer financial products or services. The CFPB
audits our compliance with these rules, and we may be subject to fines or penalties for violations of any of such rules.
ESCHEAT REGULATIONS
Our Money Transfer Segment is subject to the unclaimed or abandoned property (i.e., “escheat”) regulations of the United States and
certain foreign countries in which we operate. These laws require us to turn over property held by Euronet on behalf of others
remaining unclaimed after specified periods of time (i.e., “dormancy” or “escheat” periods). Such abandoned property is generally
attributable to the failure of beneficiary parties to claim money transfers or the failure to negotiate money orders, a form of payment
instrument. We have policies and programs in place to help us monitor the required information relating to each money transfer or
payment instrument for possible eventual reporting to the jurisdiction from which the order was originally received. In the U.S.,
reporting of unclaimed property by money service companies is performed annually, generally with a due date of on or before
November 1. State banking department regulators will typically include a review of Euronet escheat procedures and related filings as
part of their examination protocol.
PRIVACY AND INFORMATION SECURITY REGULATIONS
Our operations involve the collection and storage of certain types of personal customer data that are subject to privacy and security
laws in the U.S. and abroad. In the United States, we are subject to the Gramm-Leach-Bliley Act (“GLBA”) and various state laws
including California Consumer Privacy Act (“CCPA”), which require that financial institutions have in place policies regarding the
collection, processing, storage, and disclosure of information considered nonpublic personal information. Laws in other countries
include the E.U.’s General Data Protection Regulation (2016/679) (“GDPR”), as well as the laws of other countries. The GDPR
establishes stringent requirements for the collection and processing of personal information of individuals within the E.U. The GDPR
establishes certain rights of individuals regarding personal information processed by companies as well as requirements for
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information security and imposes significant fines that may be revenue-based for violation of its requirements. Any failure on our part
to meet the requirements of the GDPR could result in the imposition of fines and penalties that could affect our financial results.
We comply with the GLBA and applicable state privacy provisions. In July 2020, the European Court of Justice invalidated the EU-
US Privacy Shield as a lawful mechanism for transferring personal data to the US as a result of concerns related to surveillance by law
enforcement agencies and a lack of judicial redress by individuals in the EU (known as the “Schrems II” decision). Despite the July
2020 ruling of the European Court of Justice, we believe we remain in compliance with E.U. regulations regarding the transfer of
personal data to the United States and other jurisdictions.
Recently, as identity theft has been on the rise, there has been increased public attention to concerns about information security and
consumer privacy, accompanied by laws and regulations addressing the issue. We believe we are compliant with these laws and
regulations; however, this is a rapidly evolving area and there can be no assurance that we will continue to meet the existing and new
regulations, which could have a material, adverse impact on our Money Transfer Segment business.
ANTI-CORRUPTION AND BRIBERY
We are subject to the Foreign Corrupt Practices Act (“FCPA”), which prohibits U.S. and other business entities from making improper
payments to foreign government officials, political parties, or political party officials. We are also subject to the applicable anti-
corruption laws in the jurisdictions in which we operate, such as the U.K. Bribery Act, thus potentially exposing us to liability and
potential penalties in multiple jurisdictions. The anti-corruption provisions of the FCPA are enforced by the United States Department
of Justice. In addition, the Securities and Exchange Commission (“SEC”) requires strict compliance with certain accounting and
internal control standards set forth under the FCPA. Because our services are offered in many countries throughout the world and we
do business with a number of banks and other financial institutions owned or controlled by foreign governments, we face a higher risk
associated with FCPA, the U.K. Bribery Act and other similar laws than many other companies and we have policies and procedures
in place to address compliance with the FCPA, the U.K. Bribery Act and other similar laws. Any determination that we have violated
these laws could have an adverse effect on our business, financial position, and results of operations. Failure to comply with our
policies and procedures or the FCPA and other laws can expose Euronet and/or individual employees to potentially severe criminal
and civil penalties. Such penalties could have a material adverse effect on our business, financial condition, and results of operations.
SANCTIONS COMPLIANCE
In addition to anti-money laundering laws and regulations, our products and services are subject to economic and trade sanctions laws
and regulations promulgated by OFAC and other jurisdictions in which our products and services are offered. The sanctions laws and
regulations prohibit or restrict transactions to or from (or dealings with or involving) certain countries, regions, governments, and in
certain circumstances, specified foreign nationals, as well as with certain individuals and entities such as narcotics traffickers,
terrorists, and terrorist organizations. These sanctions laws and regulations require screening of transactions against government
watch-lists, including but not limited to, the watch-lists maintained by OFAC, and include transactional and other reporting to
government agencies.
COMPLIANCE POLICIES AND PROGRAMS
We have developed risk-based policies and programs to comply with existing and new laws, regulations and other requirements
outlined above, including having dedicated compliance personnel, training programs, automated monitoring systems and support
functions for our offices and agents. To assist in managing and monitoring our money laundering and terrorist financing risks, we
continue to have our compliance programs, in many countries, independently examined on an annual basis. In addition, we continue to
enhance our anti-money laundering and counter-terrorist financing compliance policy, procedures and monitoring systems, as well as
our consumer protection policies and procedures.
INTELLECTUAL PROPERTY
Each of our three operating segments utilizes intellectual property which is protected in varying degrees by a combination of
trademark, patent, and copyright laws, as well as trade secret protection, license, and confidentiality agreements.
The brand names of “Ria,” “Ria Financial Services,” “Ria Envia,” “xe,” “Dandelion,” derivations of those brand names and certain
other brand names, and related logs, are material to our Money Transfer Segment and are registered trademarks and/or service marks
in most of the markets in which our Money Transfer Segment operates. Consumer perception of these brand names and logos is
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Euronet | 2023 Annual Report
important to the growth prospects of our money transfer business. We also hold a U.S. patent on a card-based money transfer and bill
payment system that allows transactions to be initiated primarily through POS terminals and integrated cash register systems.
With respect to our EFT Processing Segment, we have registered or applied for registration of our trademarks, including the names
“Euronet” and/or our related logo, as well as other trade names in most markets in which these trademarks are used. Certain trademark
authorities have notified us that they consider these trademarks to be generic and, therefore, not protected by trademark laws. This
determination does not affect our ability to use the Euronet trademark in those markets, but it would prevent us from stopping other
parties from using it in competition with Euronet. We have registered the “Euronet” trademark in the class of ATM machines in
Germany, the U.K., and certain other Western European countries. We have filed pending applications and/or obtained patents for a
number of our new software products and our processing technology, including certain top-up services and DCC services.
With respect to our epay Segment, we maintain registered trademarks for the “epay” brand and logo in the U.S., U.K., E.U. (through a
Community Trademark application, which provides enforceability of the epay trademark in all member states of the EU), Brazil,
Singapore, India, Australia, and New Zealand. We have filed trademark applications for additional iterations of the “epay” brand in
India, which are pending.
Additionally, we have filed a trademark application for the “epay” brand with the Madrid Protocol, which, if granted, will simplify the
process to extending the international protection of the epay trademark. We cannot be certain that we are entitled to use the epay
trademark in any markets other than those in which we have registered the trademark; however, before entering new markets, we
conduct searches to understand our usage rights. We have filed patent applications for certain POS top-up and other epay technology.
Certain patents have been granted while others have been refused or are still pending. We also hold a patent license covering certain of
epay’s operations in the U.S.
Technology in the areas in which we operate is developing very rapidly, and we are aware that many other companies have filed
patent applications for products, processes, and services similar to those we provide. The procedures of the U.S. patent office make it
difficult for us to predict whether our patent applications will be approved or will be granted priority dates that are earlier than other
patents that have been filed for similar products or services. Moreover, many “process patents” have been filed in the U.S. over recent
years covering processes that are in wide use in the money transfer, EFT, and prepaid processing industries. If any of these patents are
considered to cover technology that has been incorporated into our systems, we may be required to obtain additional licenses and pay
royalties to the holders of such patents to continue to use the affected technology or be prohibited from continuing the offering of such
services if licenses are not obtained. This could materially and adversely affect our business.
INFORMATION ABOUT OUR EXECUTIVE OFFICERS
The name, age, period of service and position held by each of our Executive Officers as of February 22, 2024 are as follows:
Name
Michael J. Brown
Rick L. Weller
Scott D. Claassen
Kevin J. Caponecchi
Juan C. Bianchi
Age
Served Since
Position Held
67
66
57
57
53
July 1994
Chairman, Chief Executive Officer and President
November 2002 Executive Vice President – Chief Financial Officer
May 2020
General Counsel and Secretary
July 2007
April 2007
Executive Vice President – Chief Executive Officer, epay, Software
and EFT Asia Pacific Division
Executive Vice President – Chief Executive Officer, Money Transfer
Segment
Nikos Fountas
60
September 2009 Executive Vice President – Chief Executive Officer, EFT Europe,
Middle East and Africa Division
Martin L. Bruckner
48
January 2014
Senior Vice President – Chief Technology Officer
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MICHAEL J. BROWN, Chairman, Chief Executive Officer and President. Mr. Brown co-founded Euronet in 1994 and has served as
its chief executive officer ever since. He is chairman of Euronet’s board of directors and the Company’s President. An accomplished
entrepreneur with 30+ years of combined experience in the computer software and digital payments business, he is actively involved
in Euronet’s day-to-day operations while overseeing the company’s business strategy, financial performance, and growth across all
markets. Mr. Brown’s guidance has been instrumental in developing Euronet’s global cash/digital payments network and diverse
products and services that provide Euronet with resiliency to changing market conditions and continual year-over-year growth in the
global payments marketplace. Following early successes in his career with Kansas City-area companies Informix and Visual Tools,
Mr. Brown founded Euronet in 1994 in Budapest, Hungary, by installing the first independent, non-bank-owned ATM network in
Central Europe. Guiding the company through several strategic acquisitions and technology endeavors since then, Mr. Brown has
grown Euronet to approximately 10,000 employees and 67 offices worldwide. He has also brought financial inclusion and
convenience to businesses and consumers through a payments network spanning 200 countries and territories. A lifelong Kansas
Citian, Mr. Brown is an active supporter and past and present board member of many Kansas City-area charities.
RICK L. WELLER, Executive Vice President, Chief Financial Officer. Mr. Weller has been Executive Vice President and Chief
Financial Officer of Euronet since he joined Euronet in November 2002. From January 2002 to October 2002, he was the sole
proprietor of Pivotal Associates, a business development firm. From November 1999 to December 2001, Mr. Weller held the position
of Chief Operating Officer of ionex telecommunications, inc., a local exchange company. He is a certified public accountant and
received his B.S. in Accounting from the University of Central Missouri.
SCOTT D. CLAASSEN, General Counsel and Secretary. Mr. Claassen has been General Counsel and Secretary of Euronet since
joining the Company in May 2020. Prior to this, he practiced corporate law with Stinson LLP and Shook, Hardy and Bacon LLP. He
is a member of the Kansas and Missouri bars. He received a B.S. in Agriculture from Kansas State University, an MBA from the
University of Kansas and a law degree from Harvard Law School.
KEVIN J. CAPONECCHI, Executive Vice President, Chief Executive Officer, epay, Software and EFT Asia Pacific Division. Mr.
Caponecchi joined Euronet in July 2007 and served as President until assuming his current role in December 2014. Prior to joining
Euronet, Mr. Caponecchi served in various capacities with subsidiaries of General Electric Company for 17 years. From 2003 until
June 2007, Mr. Caponecchi served as President of GE Global Signaling, a provider of products and services to freight, passenger and
mass transit systems. From 1998 through 2002, Mr. Caponecchi served as General Manager – Technology for GE Consumer &
Industrial, a provider of consumer appliances, lighting products and electrical products. Mr. Caponecchi holds degrees in physics from
Franklin and Marshall College and industrial engineering from Columbia University.
JUAN C. BIANCHI, Executive Vice President – Chief Executive Officer, Money Transfer Segment. Mr. Bianchi joined Euronet
subsequent to the acquisition of Ria in 2007. Prior to the acquisition, Mr. Bianchi served as the Chief Executive Officer of Ria and has
spent his entire career at either Ria or AFEX Money Express, a money transfer company purchased by Ria’s founders. Mr. Bianchi
began his career at AFEX in Chile in 1992, joined AFEX USA’s operations in 1996, and became chief operating officer of AFEX-Ria
in 2003. Mr. Bianchi studied business at the Universidad Andres Bello in Chile and completed the Executive Program in Management
at UCLA’s John E. Anderson School of Business.
NIKOS FOUNTAS, Executive Vice President – Chief Executive Officer, EFT Europe, Middle East and Africa Division. Mr. Fountas
has been Executive Vice President of the Company’s EFT Processing Segment in Europe since December 2012. Mr. Fountas joined
Euronet subsequent to the Company’s 2005 acquisition of Instreamline S.A. (now Euronet Card Services) in Greece. He served as
managing director of the Company’s Greece EFT subsidiary, responsible for Euronet’s European card processing and cross-border
acquiring operations until September 2009. In September 2009, Mr. Fountas took over responsibilities as managing director of
Euronet’s Europe EFT Processing Segment. Prior to joining Euronet, Mr. Fountas spent over 20 years working in management and
executive-level positions in the IT field for several companies, including IBM for 12 years. He has a degree in computer science
(Honors) from York University in Canada and post graduate studies in business administration from Henley Management School and
IBM Business Professional Institute.
MARTIN L. BRUCKNER, Senior Vice President – Chief Technology Officer. Mr. Bruckner has been Senior Vice President and
Chief Technology Officer of Euronet since January 2014. Mr. Bruckner joined Euronet in 2007 as head of software development and
IT operations for Transact GmbH. In 2009, he was promoted to Chief Technology Officer of Euronet’s epay segment. Prior to joining
Euronet, Mr. Bruckner established his own IT company called MLB Development GmbH, where he developed software systems for
various European companies. Mr. Bruckner has more than 20 years of software development experience and published his first
software product (BBS systems) at the age of 15. He received a Doctorate of Law from the University of Rostock and a law degree
from the University of Bielefeld.
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Euronet | 2023 Annual Report
AVAILABILITY OF REPORTS, CERTAIN COMMITTEE CHARTERS, AND OTHER INFORMATION
Our website addresses are www.euronetworldwide.com and www.eeft.com. We make available all SEC public filings, including our
annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports filed
or furnished pursuant to Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (“Exchange Act”) on our
websites free of charge as soon as reasonably practicable after these documents are electronically filed with, or furnished to, the SEC.
The information on our websites is not, and shall not be deemed to be, a part of this report or incorporated into any other filings we
make with the SEC. In addition, our SEC filings are made available via the SEC’s EDGAR filing system accessible at www.sec.gov.
The charters for our Audit, Compensation, and Corporate Governance and Nominating Committees, as well as the Code of Business
Conduct & Ethics for our employees, including our Chief Executive Officer and Chief Financial Officer, are available on our website
at www.euronetworldwide.com in the “For Investors” section under “Corporate Governance / Documents and Charters”.
ITEM 1A. RISK FACTORS
Our operations are subject to a number of risks and uncertainties, including those described below. You should carefully consider the
risks described below before making an investment decision. The risks and uncertainties described below are not necessarily
organized in order of priority or probability.
If any of the following risks actually occurs, our business, financial condition or results of operations could be materially adversely
affected. In that case, the trading price of our Common Stock could decline substantially.
This Annual Report also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ
materially from those anticipated in the forward-looking statements as a result of a number of factors, including the risks described
below and elsewhere in this Annual Report.
GOVERNMENT AND REGULATION
Because we are a multinational company conducting complex business in many markets worldwide, we are subject to legal
and operational risks related to a broad array of local legal and regulatory requirements which could adversely affect our
operations.
Operating outside of the U.S. creates difficulties associated with our international operations, as well as complying with local legal
and regulatory requirements. We operate financial transaction processing networks that offer new products and services to customers,
and the laws and regulations in the markets in which we operate evolve and are subject to rapid change. Although we have
knowledgeable local staff in countries in which we deem it appropriate, we cannot assure you that we will continue to be found to be
operating in compliance with all applicable customs, currency exchange control, data protection, anti-money laundering, sanctions,
employment, transfer pricing and other laws or regulations to which we may be subject. We also cannot assure you that these laws will
not be modified in ways that may adversely affect our business.
For our epay Segment, as we continue to expand our electronic payment product and service offerings, certain of those products
and/or services may become regulated by state, federal or foreign laws, rules and regulations. New payment product and/or service
offerings may trigger payment regulation within the jurisdiction in which we are offering such payment products and services which
may require licensure for epay and/or our partner entities distributing or processing such products. If such products become more
highly regulated and ultimately require licensure, our epay business may be adversely affected. Further, if regulations regarding the
expiration of gift vouchers change in the countries where we offer them, the revenue epay recognizes from unredeemed vouchers may
be negatively affected.
Our money transfer services are subject to regulation by the U.S. states in which we operate, by the U.S. federal government and the
governments of the other countries in which we operate. Changes in the laws, rules and regulations of these governmental entities, and
our ability to obtain or retain required licensure, could have a material adverse impact on our results of operations, financial condition,
and cash flow.
Additionally, the evolving regulatory environment may change the competitive landscape across various jurisdictions and adversely
affect our financial results. If governments implement new laws or regulations, or organizations such as Visa® and Mastercard® issue
new rules, that effectively limit our ability to provide DCC or set fees and/or foreign currency exchange spreads, then our business,
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financial condition and results of operations could be materially and adversely affected. In addition, changes in regulatory
interpretations or practices could increase the risk of regulatory enforcement actions, fines and penalties and such changes may be
replicated across multiple jurisdictions.
We conduct a significant portion of our business in Central and Eastern European countries, and we have subsidiaries in the
Middle East, Asia Pacific, Africa and South America, where the risk of continued political, economic and regulatory change
that could impact our operating results is greater than in the U.S. or Western Europe.
We have subsidiaries in Central and Eastern Europe, the Middle East, Asia Pacific, Africa, and South America. We expect to continue
to expand our operations to other countries in these regions. Some of these countries have undergone significant political, economic
and social change in recent years and the risk of new, unforeseen changes in these countries remains greater than in the U.S. or
Western Europe. Recent changes to the political climate in certain Eastern European and Middle Eastern countries increase the risk
that a potential military conflict may adversely impact our operations in that region and disrupt our ATM network. In particular,
changes in laws or regulations or in the interpretation of existing laws or regulations, whether caused by a change in government or
otherwise, could materially adversely affect our business, growth, financial condition or results of operations.
For example, currently there are no limitations in any of the countries in which we have subsidiaries on the repatriation of profits from
these countries, but foreign currency exchange control restrictions, taxes or limitations may be imposed or tightened in the future with
regard to repatriation of earnings and investments from these countries. If exchange control restrictions, taxes or limitations are
imposed or tightened, our ability to receive dividends or other payments from affected subsidiaries could be reduced, which may have
a material adverse effect on us. As discussed under “Liquidity and Capital Resources” in Item 7 – Management’s Discussion and
Analysis of Financial Condition and Results of Operations, under existing U.S. tax laws, repatriation of certain assets to the U.S. could
have adverse tax consequences.
In addition, corporate, contract, property, insolvency, competition, securities and other laws and regulations in many of the countries
in which we operate have been, and continue to be, substantially revised. Therefore, the interpretation and procedural safeguards of
the new legal and regulatory systems are in the process of being developed and defined, and existing laws and regulations may be
applied inconsistently. Also, in some circumstances, it may not be possible to obtain the legal remedies provided for under these laws
and regulations in a reasonably timely manner, if at all.
We conduct business in many international markets with complex and evolving tax rules, including value added tax rules,
which subject us to international tax compliance risks which could adversely affect our operating results.
While we obtain advice from legal and tax advisors as necessary to help assure compliance with tax and regulatory matters, most tax
jurisdictions that we operate in have complex and subjective rules regarding the valuation of intercompany services, cross-border
payments between affiliated companies and the related effects on income tax, value added tax (“VAT”), transfer tax and share
registration tax. Our foreign subsidiaries frequently undergo VAT reviews, and from time to time undergo comprehensive tax reviews
and may be required to make additional tax payments should the review result in different interpretations, allocations or valuations of
our products and services.
Additionally, as a result of economic downturns, tax receipts have decreased and/or government spending has increased in many of
the countries in which we operate. Consequently, governments may increase tax rates or implement new taxes in order to compensate
for gaps between tax revenues and expenditures. Governments may prohibit or restrict the use of certain legal structures designed to
minimize taxes. Any such tax increases, whether borne by us or our customers, could negatively impact our operating results or the
demand for our products and services.
The European Union (“EU”) member states formally adopted the EU’s Pillar Two Directive, which was established by the
Organization for Economic Co-operation and Development, and which generally provides for a 15 percent minimum effective tax rate
for multinational enterprises, in every jurisdiction in which they operate. While we do not anticipate that the Pillar Two Directive will
have a material impact on our tax provision or effective tax rate, we continue to monitor evolving tax legislation in the jurisdictions in
which we operate.
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Euronet | 2023 Annual Report
We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act or other similar anti-corruption laws.
Our operations in countries outside the United States are subject to anti-corruption laws and regulations, including restrictions
imposed by the FCPA. The FCPA and similar anti-corruption laws in other jurisdictions, such as the U.K. Bribery Act, generally
prohibit companies and their intermediaries from making improper payments to government officials or employees of commercial
enterprises for the purpose of obtaining or retaining business. We operate in many parts of the world that have experienced corruption
to some degree and, in certain circumstances, strict compliance with anti-corruption laws may conflict with local customs
and practices.
Our employees and agents interact with government officials on our behalf, including as necessary to obtain licenses and other
regulatory approvals necessary to operate our business, import or export equipment, employ expatriates, and resolve tax disputes. We
also have a number of contracts with foreign governments or entities owned or controlled by foreign governments. These interactions
and contracts create a risk of violation of the FCPA or other similar laws.
Although we have implemented policies and procedures designed to ensure compliance with local laws and regulations as well as U.S.
laws and regulations, including the FCPA, there can be no assurance that all of our employees, consultants, contractors and agents will
abide by our policies. If we are found to be liable for violations of the FCPA or similar anti-corruption laws in other jurisdictions,
either due to our own or others’ acts or inadvertence, we could suffer from criminal or civil penalties which could have a material and
adverse effect on our results of operations, financial condition, and cash flows.
Our operating results in the money transfer business may be harmed if there are adverse changes in worker immigration
patterns, our ability to expand our share of the existing electronic market and to expand into new markets and our ability to
continue complying with regulations issued by the OFAC, BSA, FINCEN, USA PATRIOT Act regulations, the Dodd-Frank
Act or any other existing or future regulations that impact any aspect of our money transfer business.
Our money transfer business primarily focuses on workers who migrate to foreign countries in search of employment and then send a
portion of their earnings to family members in their home countries. Changes in U.S. and foreign government policies or enforcement,
including changes that have been, or may be, implemented by the U.S. President or Congress, toward immigration may have a
negative effect on immigration in the U.S. and other countries, which could also have an adverse impact on our money transfer
revenues.
Both U.S. and foreign regulators have become increasingly aggressive in the enforcement of the various regulatory regimes applicable
to our businesses and the imposition of fines and penalties in the event of violations. Our ability to continue complying with the
requirements of OFAC, BSA, FINCEN, the USA PATRIOT Act, the Dodd-Frank Act, and other regulations (both U.S. and foreign) is
important to our success in achieving growth and an inability to do this could have an adverse impact on our revenues and earnings.
Anti-money laundering, sanctions, and consumer protection regulations require us to be responsible for the compliance by agents with
such regulations. Although we have training and compliance programs in place, we cannot be certain our agents will comply with such
regulations and we may be held responsible for their failure to comply, resulting in fines and penalties. Future growth and profitability
depend upon expansion within the markets in which we currently operate and the development of new markets for our money transfer
services. Our expansion into new markets is dependent upon our ability to successfully apply our existing technology or to develop
new applications to satisfy market demand. We may not have adequate financial and technological resources to expand our
distribution channels and product applications to satisfy these demands, which may have an adverse impact on our ability to achieve
the expected growth in revenues and earnings.
Expectations relating to environmental, social and governance considerations and related reporting obligations expose us to
potential liabilities, increased costs, reputational harm, and other adverse effects on our business.
Many governments, regulators, investors, employees, customers, and other stakeholders are increasingly focused on environmental,
social and governance considerations relating to businesses, including climate change and greenhouse gas emissions, human and civil
rights, and diversity, equity and inclusion. In addition, we make statements about our goals and initiatives through our various non-
financial reports, information provided on our website, press statements and other communications. Responding to these
environmental, social and governance considerations and implementation of these goals and initiatives involves risks and
uncertainties, requires investments, and depends in part on third-party performance or data that is outside our control. We cannot
guarantee that we will achieve our environmental, social and governance goals and initiatives. In addition, some stakeholders may
disagree with our goals and initiatives. Any failure, or perceived failure, by us to achieve our goals, further our initiatives, adhere to
A Network of Enablement
39
our public statements, comply with federal, state, or international environmental, social and governance laws and regulations, or meet
evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against us and materially
adversely affect our business, reputation, results of operations, financial condition and stock price.
Our business, results of operations and financial condition could be adversely impacted by unfavorable results of legal
proceedings or government investigations.
We are subject to various claims, legal proceedings and government investigations that have arisen in the ordinary course of business
and have not yet been fully resolved, and new matters may arise in the future. In addition, agreements entered into by us sometimes
include indemnification provisions which can subject us to costs and damages in the event of a claim against an indemnified third
party. The number of claims, legal proceedings and government investigations involving us, and the alleged magnitude of such claims,
proceedings, and government investigations, has generally increased over time and may continue to increase. In recognition of these
considerations, we may enter into agreements or other arrangements to settle litigation and resolve such challenges. There can be no
assurance such agreements can be obtained on acceptable terms or that litigation will not occur. These agreements can also
significantly increase our cost of sales and operating expenses and require us to change its business practices and limit our ability to
offer certain products and services. The outcome of litigation or government investigations is inherently uncertain. If one or more
legal matters were resolved against us or an indemnified third party in a reporting period for amounts above management’s
expectations, our results of operations and financial condition for that reporting period could be materially adversely affected. Further,
such an outcome can result in significant compensatory, punitive or trebled monetary damages, disgorgement of revenue or profits,
remedial corporate measures or injunctive relief against us, and has from time to time required, and can in the future require, us to
change our business practices and limit our ability to offer certain products and services, all of which could materially adversely affect
the Company’s business, reputation, results of operations and financial condition. While we maintain insurance coverage for certain
types of claims, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise.
SUPPLY CHAIN AND THIRD PARTIES
Because we typically enter into short-term contracts with content providers and retailers, our epay business is subject to the
risk of non-renewal of those contracts, or renewal under less favorable terms.
Our contracts with content providers to distribute and process content, including prepaid mobile airtime top-up services, typically have
terms of less than three years. Our contracts with content providers are not exclusive, so these providers may enter into contracts with
other service providers. In addition, our service contracts with major retailers typically have terms of one to three years. The
cancellation or non-renewal of one or more of our significant content provider or retail contracts, or of a large enough group of our
contracts with smaller retailers, could have a material adverse effect on our business, financial condition, and results of operations.
The renewal of contracts under less favorable payment terms, margins or other terms could have a material adverse impact on our
working capital requirements and/or results from operations. In addition, our contracts generally permit content providers to reduce
our margin or commission at any time. Commission and margin revenue or fee reductions by any of the content providers could also
have a material adverse effect on our business, financial condition, or results of operations.
Our epay business is focused on expanding and differentiating its suite of prepaid digital product offerings on a global basis, there can
be no assurance that we will be able to enter into relationships on favorable terms with additional content providers or renew or
expand current relationships and contracts on favorable terms. The inability to continue to grow our suite of electronic content and
electronic payment product offerings could have a material adverse effect on our business, financial condition, and results of
operations.
The stability and growth of our EFT Processing Segment may be adversely affected if we are unable to maintain our current
card acceptance and ATM management agreements with banks and international card organizations, and to secure new
arrangements for card acceptance and ATM management.
The stability and future growth of our EFT Processing Segment depends in part on our ability to sign card acceptance and ATM
management agreements with banks and international card organizations. Card acceptance agreements allow our ATMs to accept
credit and debit cards issued by banks and international card organizations. ATM management agreements generate service income
from our management of ATMs for banks.
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Euronet | 2023 Annual Report
These agreements have expiration dates, and banks and international card organizations are generally not obligated to renew them.
Our existing contracts generally have terms of five to seven years and a number of them expire or are up for renewal each year. In
some cases, banks may terminate their contracts prior to the expiration of their terms. We cannot assure you that we will be able to
continue to sign or maintain these agreements on terms and conditions acceptable to us or that international card organizations will
continue to permit our ATMs to accept their credit and debit cards. The inability to continue to sign or maintain these agreements, or
to continue to accept the credit and debit cards of local banks and international card organizations at our ATMs in the future, could
have a material adverse effect on our business, growth, financial condition, or results of operations.
In some cases, we are dependent upon international card organizations and national transaction processing switches to
provide assistance in obtaining settlement from card issuers of funds relating to transactions on our ATMs, and any failure by
them to provide the required cooperation could result in our inability to obtain settlement of funds relating to transactions.
Our ATMs dispense cash relating to transactions on credit and debit cards issued by banks. We have in place arrangements for the
settlement to us of all of those transactions, but in some cases, we do not have a direct relationship with the card-issuing bank and rely
for settlement on the application of rules that are administered by international card associations (such as Visa® or Mastercard®) or
national transaction processing switching networks. If a bankcard issuer fails to settle transactions in accordance with those rules, we
are dependent upon cooperation from such associations or switching networks to enforce our right of settlement against such
associations. Failure by such organizations or switches to provide the required cooperation could result in our inability to obtain a
settlement of funds relating to transactions and adversely affect our business. Moreover, international card associations and issuers of
their cards (and, in the case of Visa, member banks) have the ability to change or apply their rules in ways that could negatively
impact our business. As an example, DCC is not permitted on certain cards in certain geographic territories, and the scope of such
restrictions could be extended. Any such change or application of the rules of international card associations could materially and
adversely affect our business.
We could incur substantial losses if one of the third-party depository institutions or financial institutions we use in our
operations were to fail.
As part of our business operations, we maintain cash balances at third party depository institutions. We could incur substantial losses
if a financial institution in which we have significant deposits fails.
Our money transfer business involves transferring funds internationally and is dependent upon foreign and domestic financial
institutions, including our competitors, to execute funds transfers and foreign currency transactions. Changes to existing regulations of
financial institution operations, such as those designed to combat terrorism or money laundering, could require us to alter our
operating procedures in a manner that increases our cost of doing business or to terminate certain product offerings. In addition, as a
result of existing regulations and/or changes to those regulations, financial institutions could decide to cease providing the services on
which we depend, requiring us to terminate certain product offerings.
We are required under certain national laws and the rules of financial transaction switching networks in many of our markets
to have sponsors to operate ATMs and switch ATM transactions. Our failure to secure sponsor arrangements in any of our
markets that require bank sponsors could prevent us from doing business in that market.
Under the laws of some countries, only a licensed financial institution may operate ATMs. Because we are not a licensed financial
institution outside of the E.U. we are required to have a sponsor bank to conduct ATM operations in those countries. In addition, in all
of our non-E.U. markets, the rules governing national transaction switching networks owned or operated by banks, and other
international financial transaction switching networks operated by organizations such as Citibank, Visa® and Mastercard®, require any
company sending transactions through these switches to be a bank or a technical service processor that is approved and monitored by a
bank. As a result, the operation of our ATM network in many of our markets depends on our ability to secure these sponsor
arrangements with financial institutions.
To date, we have been successful in reaching contractual arrangements that have permitted us to operate in all of our target markets.
However, we cannot assure you that we will continue to be successful in reaching these arrangements, and it is possible that our
current arrangements will not continue to be renewed. If we are unable to secure sponsor arrangements in any market, we could be
prevented from doing business in that market.
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41
We rely on third party financial institutions to provide us with a portion of the cash required to operate our ATM networks in
certain countries. If these institutions were unable or unwilling to provide us with the cash necessary to operate our ATM
networks, we would be required to locate additional alternative sources of cash to operate these networks.
In our EFT Processing Segment, we primarily rely on third party financial institutions in certain countries in Europe and Asia Pacific
to provide us with the cash required to operate our ATM networks. Under our agreements with these providers, we pay fees or
interest, which is generally variable and could increase, based on the total amount of cash we are using from such provider at a given
time, as well as other costs such as bank fees and cash transportation costs. As of December 31, 2023, the amount of cash used in our
ATM networks under these supply agreements was approximately $576.2 million. Before the cash is disbursed to ATM customers,
beneficial ownership of the cash is generally retained by the cash providers, and we have no access or proprietary rights to the cash.
Our existing agreements with cash providers are generally multi-year agreements that expire at various times. However, each provider
may have the right to demand the return of all or any portion of its cash at any time upon the occurrence of certain events beyond our
control, including certain bankruptcy events affecting us or our subsidiaries, or a breach of the terms of our cash provider agreements.
If any of our cash supply providers were to demand return of their cash or terminate their agreements with us and remove their cash
from our ATM devices, or if they fail to provide us with the cash our operations require, our ability to operate the ATM networks to
which the provider supplies cash would be jeopardized, and we would need to locate additional alternative sources of cash, including,
potentially the increased use of our own cash. Under those circumstances, the terms and conditions of the new or renewed agreements
could potentially be less favorable to us, which would negatively impact our results of operations. Furthermore, restrictions on our
access to cash to supply our ATMs could severely restrict our ability to keep our ATMs operating, which could subject us to
performance penalties under our contracts with our customers.
We have encountered difficulty in obtaining cash supply arrangements in certain of our markets, including Greece, and directly
provide cash for our ATM transactions in those markets. While the amounts involved are currently well within our capabilities given
our cash flows and available financing, any failure to renew a major cash supply arrangement could require that we commit significant
financial resources to the supply of cash to our ATM networks, which could adversely impact our results of operations.
If we are unable to maintain our money transfer agent and correspondent networks, our business may be adversely affected.
Our consumer-to-consumer money transfer-based revenues are primarily generated through the use of our agent and correspondent
networks. If agents or correspondents decide to leave our network or if we are unable to sign new agents or correspondents, our
revenue and profit growth rates may be adversely affected. Our agents and correspondents are also subject to a wide variety of laws
and regulations that vary significantly, depending on the legal jurisdiction. Changes in these laws and regulations could adversely
affect our ability to maintain the networks or the cost of providing money transfer services. In addition, agents may generate fewer
transactions or less revenue due to various factors, including increased competition. Because our agents and correspondents are third
parties that may sell products and provide services in addition to our money transfer services, they may encounter business difficulties
unrelated to the provision of our services, which may cause the agents or correspondents to reduce their number of locations or hours
of operation, or cease doing business altogether.
CORPORATE GROWTH STRATEGIES
Our business may suffer from risks related to acquisitions and potential future acquisitions.
A substantial portion of our growth has been due to acquisitions, and we continue to evaluate and engage in discussions concerning
potential acquisition opportunities, some of which could be material. We cannot assure you that we will be able to successfully
integrate, or otherwise realize anticipated benefits from, our recent acquisitions or any future acquisitions. Failure to successfully
integrate or otherwise realize the anticipated benefits of these acquisitions could adversely impact our long-term competitiveness and
profitability. The integration of any future acquisitions will involve a number of risks that could harm our financial condition, results
of operations and competitive position. In particular:
•
The integration plans for our acquisitions are based on benefits that involve assumptions as to future events, including our
ability to successfully achieve anticipated synergies, leveraging our existing relationships, as well as general business and
industry conditions, many of which are beyond our control and may not materialize. Unforeseen factors may offset
components of our integration plans in whole or in part. As a result, our actual results may vary considerably, or be
considerably delayed, compared to our estimates;
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•
The integration process could disrupt the activities of the businesses that are being combined. The combination of companies
requires, among other things, coordination of administrative and other functions. In addition, the loss of key employees,
customers or vendors of acquired businesses could materially and adversely impact the integration of the acquired businesses;
The execution of our integration plans may divert the attention of our management from other key responsibilities;
•
• We may assume unanticipated liabilities and contingencies; or
• Our acquisition targets could fail to perform in accordance with our expectations at the time of purchase.
Future acquisitions may be affected through the issuance of our common stock or securities convertible into our common stock, which
could substantially dilute the ownership percentage of our current stockholders. In addition, shares issued in connection with future
acquisitions could be publicly tradable, which could result in a material decrease in the market price of our common stock. Certain
factors on which our ability to expand each of our divisions is dependent are set forth at Item 7, Management’s Discussion and
Analysis of Financial Condition and Results of Operations – Opportunities and Challenges. If any of such factors impede our ability to
expand our businesses, the results of operations and financial condition could be materially and adversely affected.
Our operating results depend, in part, on the volume of transactions on ATMs in our network and the fees we can collect
from processing these transactions. We generally have little control over the ATM transaction fees established in the markets
where we operate, and therefore, cannot control any potential reductions in these fees which may adversely affect our results
of operations.
Transaction fees from banks, customers and international card organizations for transactions processed on our ATMs have historically
accounted for a substantial portion of our revenues. These fees are set by agreement among all banks in a particular market. The future
operating results of our ATM business depend on the following factors:
•
•
•
•
the acceptance of our ATM processing and management services in our target markets;
the maintenance of the level of transaction fees we receive;
the continued use of our ATMs by credit and debit cardholders; and
our ability to generate revenues from interchange fees and from other value added services, including dynamic
currency conversion.
The amount of fees we receive per transaction is set in various ways in the markets in which we do business. We have card acceptance
agreements or ATM management agreements with some banks under which fees are set. However, we derive a significant portion of
our revenues in many markets from interchange fees, surcharges or cash withdrawal related services that are set by the central ATM
processing switch or various card organizations. The banks that participate in these switches or the card organizations that enable the
services or transactions set the interchange fee and/or establish the rules regarding the services allowed, and we are not in a position in
any market to greatly influence these fees or rules, which may change over time. A significant decrease in the interchange fee, or
limitations placed on our ability to offer value added services via our ATM network, in any market could adversely affect our results
in that market.
Although we believe that the volume of transactions in developing countries may increase due to growth in the number of cards being
issued by banks in these markets, we anticipate that transaction levels on any given ATM in developing markets will not increase
significantly. We can attempt to improve the levels of transactions on our ATM network overall by acquiring good sites for our
ATMs, eliminating poor locations, entering new, less-developed markets and adding new transactions, including new value-added
services, to the sets of transactions that are available on our ATMs. However, we may not be successful in materially increasing
transaction levels through these measures. Per-transaction fees paid by international card organizations have declined in certain
markets in the past and competitive factors have required us to reduce the transaction fees we charge customers. If we cannot continue
to increase our transaction levels and per-transaction fees generally decline, our results will be adversely affected.
If consumer confidence in our business or brands declines, our business may be adversely affected.
Our business relies on customer confidence in our brands and our ability to provide efficient and reliable products and services across
each of our segments. For our Money Transfer division, a decline in customer confidence in our business or brands, or in traditional
money transfer providers as a means to transfer money, may adversely impact transaction volumes which would, in turn, be expected
to adversely impact our business and possibly result in recording charges for the impairment of goodwill and/or other long-
lived assets.
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CAPITAL MARKETS AND ECONOMIC CONDITIONS
We are subject to political tension, the outbreak of wars, pandemics, and economic downturns all over the world.
Economic conditions around the world, and in certain markets in which we do business, could impact sales price and volume. As a
result, market uncertainty or an economic downturn driven by inflationary pressures; political tensions; war and related sanctions and
export restrictions; terrorism; epidemics; pandemics; or political instability in the geographic regions or industries in which
we provide services and products could reduce demand and result in decreased sales volume, which could have a negative impact on
our results of operations.
In February 2022, Russia invaded Ukraine resulting in the United States, Canada, the EU and other countries imposing economic
sanctions on Russia. We suspended our operations and product offerings in Russia. This action has not had a material impact on our
financial condition or results of operations. However, the fluidity and continuation of the conflict may result in additional economic
sanctions and other impacts which could have a negative impact on our financial condition, results of operations and cash flows. These
include decreased sales; potential disruptions in neighboring countries where we have operations; volatility in foreign exchange rates
and interest rates; inflationary pressures; and heightened cyber security threats.
We are subject to business cycles, seasonality and other outside factors that may negatively affect our business.
A recessionary economic environment in any of our markets or other outside factors could have a negative impact on banks, mobile
phone operators, content providers, retailers and our individual customers and could reduce the level of transactions in all of our
divisions, which would, in turn, negatively impact our financial results. If banks, mobile phone operators and content providers
experience decreased demand for their products and services, or if the locations where we provide services decrease in number, we
will process fewer transactions, resulting in lower revenues. In addition, a recessionary economic environment could reduce the level
of transactions taking place on our networks, which will have a negative impact on our business.
Our experience is that the level of transactions on our networks is also subject to substantial seasonal variation. In the EFT Processing
Segment, mostly in Europe, we usually experience our heaviest demand for dynamic currency conversion during the third quarter of
the fiscal year, coinciding with the tourism season in Europe. As a result, our revenues earned in the third quarter of the year will
usually be greater than other quarters of the fiscal year. Additionally, transaction levels have consistently been higher in the fourth
quarter of the fiscal year due to increased use of ATMs, prepaid products, and money transfer services during the holiday season.
Generally, the level of transactions drops in the first quarter, during which transaction levels are generally the lowest we experience
during the year, which reduces the level of revenues that we record. In the Money Transfer Segment, we experience increased
transaction levels during the May through October time frame, coinciding with certain holidays and the increase in worker migration
patterns. As a result of these seasonal variations, our quarterly operating results may fluctuate materially and could lead to volatility in
the price of our shares.
Additionally, economic, or political instability, wars, civil unrest, terrorism, epidemics, pandemics, and natural disasters may make
money transfers to, from or within a particular country more difficult. The inability to timely complete money transfers could
adversely affect our business.
Economic cycles may lead us to recognize impairment charges related to long-lived assets and goodwill recorded in connection with
our acquisitions, which would adversely impact our results of operations. Our total assets include approximately $1,015 million, or
17% of total assets, in goodwill and acquired intangible assets recorded as a result of acquisitions. We assess our goodwill, intangible
assets, and other long-lived assets as and when required by accounting principles generally accepted in the U.S. to determine whether
they are impaired. We have had material impairment write-downs of goodwill and acquired intangible assets in the past and we may
have additional impairment write-downs in the future. If operating results in any of our key markets deteriorate or our plans do not
progress as expected when we acquired these entities, or if capital markets depress our value or that of similar companies, we may be
required to record additional impairment write-downs of goodwill, intangible assets, or other long-lived assets. This could have a
material adverse effect on our results of operations and financial condition.
We have a substantial amount of debt and other contractual commitments, and while the cost of servicing those obligations is
not expected to adversely affect our business, the risk could increase if we incur more debt. We may be required to prepay our
obligations under the credit facility.
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Euronet | 2023 Annual Report
As of December 31, 2023, total liabilities were $4,645 million, of which $1,944 million represents long-term liabilities, and total
assets were $5,894 million. We may not have sufficient funds to satisfy all such obligations as a result of a variety of factors, some of
which may be beyond our control. If the opportunity of a strategic acquisition arises or if we enter into new contracts that require the
installation or servicing of infrastructure, such as processing centers, ATM machines or POS terminals on a faster pace than
anticipated, we may be required to incur additional debt for these purposes and to fund our working capital needs, including ATM
network cash, which we may not be able to obtain. The level of our indebtedness could have important consequences to investors,
including the following:
• our ability to obtain any necessary financing in the future for working capital, capital expenditures, debt service requirements
or other purposes may be limited, or financing may be unavailable;
•
a portion of our cash flows must be dedicated to the payment of principal and interest on our indebtedness and other obligations
and will not be available for use in our business;
• our level of indebtedness could limit our flexibility in planning for, or reacting to, changes in our business and the markets in
which we operate;
• our level of indebtedness will make us more vulnerable to changes in general economic conditions and/or a downturn in our
business, thereby making it more difficult for us to satisfy our obligations; and
• because a portion of our debt bears interest at a variable rate of interest, our actual debt service obligations could increase as a
result of adverse changes in interest rates.
If we fail to make required debt payments, or if we fail to comply with other covenants in our debt service agreements, we would be in
default under the terms of these agreements. This default would permit the holders of the indebtedness to accelerate repayment of this
debt and could cause defaults under other indebtedness that we have.
Restrictive covenants in our credit facilities may adversely affect us. Our Credit Facility (as defined below) contains two financial
covenants that we must meet as defined in the agreement: (1) Consolidated Total Leverage Ratio, and (2) Consolidated Interest
Coverage Ratio. To remain in compliance with our debt covenants, we may be required to increase Earnings Before Interest, Taxes,
Depreciation and Amortization (“EBITDA”), repay debt, or both. We cannot assure you that we will have sufficient assets, liquidity
or EBITDA to meet or avoid these obligations, which could have an adverse impact on our financial condition.
Our ability to secure additional financing for growth or to refinance any of our existing debt is also dependent upon the availability
of credit in the marketplace, which has experienced severe disruptions in the past. If we are unable to secure additional financing
or such financing is not available at acceptable terms, we may be unable to secure financing for growth or refinance our debt
obligations, if necessary.
Because we derive our revenues from a multitude of countries with different currencies, our business may be adversely
affected by local inflation and foreign currency exchange rates and policies.
We report our results in U.S. dollars, although a majority of our income is realized in foreign currencies. As exchange rates among the
U.S. dollar, the euro, and other currencies fluctuate, the impact of these fluctuations may have a material adverse effect on our results
of operations or financial condition as reported in U.S. dollars.
A significant number of our ATMs are located in countries in the EU that use the euro. From time to time, some of these countries
have considered leaving the EU and adopting another currency. If such an event were to occur, the conversion of cash that we hold in
banks and in our ATM network in that country from euros to another currency could have an adverse effect on our financial condition
or results of operations, either from initial conversion or from subsequent changes in currency exchange rates. The magnitude of this
risk increases when cash balances in our ATM network increase during the tourism season.
Our Money Transfer Segment is subject to foreign currency exchange risks because our customers deposit funds in one currency at
our retail and agent locations worldwide or in an online account and we typically deliver funds denominated in a different, destination
country currency. Although we use foreign currency derivative contracts to mitigate a portion of this risk, we cannot eliminate all of
the exposure to the impact of changes in foreign currency exchange rates for the period between collection and disbursement of the
money transfers.
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CYBER, PHYSICAL ASSET, AND DATA SECURITY
Because our business is highly dependent on the proper operation of our computer networks and telecommunications
connections, significant technical disruptions to these systems would adversely affect our revenues and financial results.
Our business involves the operation and maintenance of sophisticated computer networks and telecommunications connections with
financial institutions, mobile phone operators, other content providers, retailers, and agents. This, in turn, requires the maintenance of
computer equipment and infrastructure, including telecommunications and electrical systems, and the integration and enhancement of
complex software applications. There are operational risks inherent in this type of business that can result in the temporary shutdown
of part or all of our processing systems, such as failure of electrical supply, failure of computer hardware, security breaches and
software errors, computer viruses, ransomware and malware. Any operational problem in our processing centers may have a
significant adverse impact on the operation of our networks. Even with disaster recovery procedures in place, these risks cannot be
eliminated entirely, and any technical failure that prevents operation of our systems for a significant period of time will prevent us
from processing transactions during that period of time and will directly and adversely affect our revenues and financial results.
We are subject to security breaches of our systems or those of our partners. Any such breach may cause us to incur financial
losses, liability, harm to our reputation, litigation, regulatory enforcement actions and limitations on our ability to conduct
our businesses.
We and our partners capture, transmit, handle and store sensitive information in conducting and managing electronic, financial, and
mobile transactions, such as card information, PIN numbers and personal information of various types. These businesses involve
certain inherent security risks, in particular: the risk of electronic interception and theft of the information for use in fraudulent or
other card transactions by persons outside the Company, including third party vendors or by our own employees; and the use of
fraudulent cards on our network of owned or outsourced ATMs and POS devices. We incorporate industry-standard encryption
technology and processing methodology into our systems and software and maintain controls and procedures regarding access to our
computer systems by employees and others, to maintain high levels of security. Although this technology and methodology decreases
security risks, they cannot be eliminated entirely as criminal elements apply increasingly sophisticated technology to attempt to obtain
unauthorized access to the information handled by ATM, money transfer and electronic financial transaction networks. Our services
and infrastructure are increasingly reliant on the internet. Computer networks and the internet are vulnerable to unauthorized access,
computer viruses and other disruptive problems such as denial of service attacks or other cyber-attacks carried out by cyber criminals
or state-sponsored actors. Other potential attacks include attempts to obtain unauthorized access to confidential information or destroy
data, often through the introduction of computer viruses, ransomware or malware, cyber-attacks, and other means, which are
constantly evolving and difficult to detect. Those same parties may also attempt to fraudulently induce employees, customers,
vendors, or other users of our systems through phishing schemes or other methods to disclose sensitive information in order to gain
access to our data or that of our customers or clients. In addition, the cost and timeframes required for implementation of new
technology may result in a time lag between availability of such technology and our adoption of it. Further, our controls, procedures
and technology may not be able to detect when there is a breach, causing a delay in our ability to mitigate it. As previously disclosed,
we have been the subject of computer security breaches, and we cannot exclude the possibility of additional breaches in the future.
Any breach in our security systems could result in the perpetration of fraudulent financial transactions for which we may bear the
liability. We are insured against various risks, including theft and negligence, but such insurance coverage is subject to deductibles,
exclusions and limits that may leave us bearing some or all of any losses arising from security breaches.
We and our partners also collect, transfer, and retain personal data as part of our business. These activities are subject to certain
privacy laws and regulations in the U.S. and in other jurisdictions where our services are offered. We maintain technical and
operational safeguards designed to comply with applicable legal requirements. Despite these safeguards, there remains a risk that these
safeguards could be breached resulting in improper access to, and disclosure of, sensitive customer information. Under state, federal,
and foreign laws requiring consumer notification of security breaches, the costs to remediate security breaches can be substantial.
Breaches of our security policies or applicable legal requirements resulting in a compromise of customer data could expose us to
regulatory enforcement action, subject us to litigation, limit our ability to provide services and/or cause harm to our reputation.
In addition to electronic fraud issues and breaches of our systems, the possible theft and vandalism of ATMs or cash in the ATMs
present risks for our ATM business. We install ATMs at high-traffic sites and consequently our ATMs are exposed to theft and
vandalism, and to attacks whereby the security of the ATM is breached electronically by transmitting a command to the ATM to
dispense cash without a card being present. We constantly monitor ATM security and take measures to protect our systems from such
attacks and other breaches, but we cannot be certain that our measures will be effective against new, rapidly developing methods used
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Euronet | 2023 Annual Report
by criminal elements. Although we are insured against such risks, deductibles, exclusions, or limitations in such insurance may leave
us bearing some or all of any losses arising from theft or vandalism of ATMs or loss of cash due to security breaches of our ATM
networks. In addition, we have experienced increases in claims under our insurance, which has increased our insurance premiums.
Failures of third-party service providers we rely upon could lead to financial loss.
We rely on third party service providers to support key portions of our operations. We also rely on third party service providers to
provide part or all of certain services we deliver to customers. While we have selected these third-party vendors carefully, we do not
control their actions. The failure of these services by a third-party could have a material impact upon our delivery of services to
customers. Such a failure could lead to damage claims, loss of customers, and reputational harm, depending on the duration and
severity of the failure. Third parties perform significant operational services on our behalf. These third-party vendors are subject to
similar risks as us relating to cybersecurity, breakdowns or failures of their own systems or employees. One or more of our vendors
may experience a cybersecurity event or operational disruption and, if any such event does occur, it may not be adequately addressed,
either operationally or financially, by the third-party vendor. Certain of our vendors may have limited indemnification obligations or
may not have the financial capacity to satisfy their indemnification obligations. If a critical vendor is unable to meet our needs in a
timely manner or if the services or products provided by such a vendor are terminated or otherwise delayed and if we are not able to
develop alternative sources for these services and products quickly and cost-effectively, our customers could be negatively impacted,
and it could have a material adverse effect on our business.
Our business is subject to a variety of U.S. and international laws, rules, policies and other obligations regarding
data protection.
We are subject to an increasing number of federal, state, and international laws relating to the collection, use, retention, security and
transfer of various types of personal information. In many cases, these laws apply not only to third-party transactions, but also restrict
transfers of personal information among us and its our international subsidiaries. Several jurisdictions have passed laws in this area,
and additional jurisdictions are considering imposing additional restrictions or have laws that are pending. These laws continue to
develop and may be inconsistent from jurisdiction to jurisdiction. Complying with emerging and changing requirements causes us to
incur substantial costs and has required and may in the future require us to change its our business practices. Noncompliance could
result in significant penalties or legal liability. We make statements about its our use and disclosure of personal information through
its our privacy policy, information provided on its our website, press statements and other privacy notices provided to customers. Any
failure by us to comply with these public statements or with other federal, state or international privacy or data protection laws and
regulations could result in inquiries or proceedings against us by governmental entities or others. In addition to reputational impacts,
penalties could include ongoing audit requirements and significant legal liability. In addition to the risks generally relating to the
collection, use, retention, security and transfer of personal information, we are also subject to specific obligations relating to
information considered sensitive under applicable laws, such as health data, financial data and biometric data. Health data and
financial data are subject to additional privacy, security and breach notification requirements, and we are subject to audit by
governmental authorities regarding our compliance with these obligations. If we fail to adequately comply with these rules and
requirements, or if health data or financial data is handled in a manner not permitted by law or under our agreements with healthcare
or financial institutions, we can be subject to litigation or government investigations, and can be liable for associated investigatory
expenses, and can also incur significant fees or fines. Payment card data is also subject to additional requirements. Under payment
card rules and obligations, if cardholder information is potentially compromised, we can be liable for associated investigatory
expenses and can also incur significant fees or fines if we fail to follow payment card industry data security standards. We could also
experience a significant increase in payment card transaction costs or lose the ability to process payment cards if it fails we fail to
follow payment card industry data security standards, which could materially adversely affect our business, reputation, results of
operations and financial condition.
COMPETITIVE LANDSCAPE
Our competition in the EFT Processing Segment, epay Segment and Money Transfer Segment includes large, well-financed
companies and financial institutions larger than us with earlier entry into the market. As a result, we may lack the financial
resources and access to capital needed to capture increased market share.
EFT Processing Segment — Our principal EFT Processing competitors include ATM networks owned by banks and national
switches consisting of consortiums of local banks that provide outsourcing and transaction services only to banks and independent
ATM deployers in that country. Large, well-financed companies offer ATM network and outsourcing services that compete with us in
various markets. In some cases, these companies also sell a broader range of card and processing services than we do, and are, in some
A Network of Enablement
47
cases, willing to discount ATM services to obtain large contracts covering a broad range of services. Competitive factors in our EFT
Processing Segment include network availability and response time, breadth of service offering, price to both the bank and to its
customers, ATM location and access to other networks.
epay Segment — We face competition in the epay business in all of our markets. A few multinational companies operate in several of
our markets, and we therefore compete with them in a number of countries. In other markets, our competition is from smaller, local
companies. Major retailers with high volumes are in a position to demand a larger share of margin/commissions or to negotiate
directly with the content providers, which may compress our margins. Additionally, certain of our content providers, including mobile
phone operators have entered into direct contracts with retailers and/or have developed processing technology that diminishes or
eliminates the need for intermediate processors and distributors.
Money Transfer Segment — Our primary competitors in the money transfer and bill payment business include other large money
transfer companies and electronic money transmitters, as well as certain major national and regional banks, financial institutions, and
independent sales organizations. Our competitors include The Western Union Company and MoneyGram International Inc. The
Western Union Company has a significant competitive advantage due to its greater resources and access to capital for expansion. This
may allow them to offer better pricing terms to customers, which may result in a loss of our current or potential customers or could
force us to lower our prices. Either of these actions could have an adverse impact on our revenues. In addition, our competitors may
have the ability to devote more financial and operational resources than we can to the development of new technologies that provide
improved functionality and features to their product and service offerings. If successful, their development efforts could render our
product and service offerings less desirable, resulting in the loss of customers or a reduction in the price we could demand for our
services. In addition to traditional money payment services, new technologies are emerging that may effectively compete with
traditional money payment services, such as stored-value cards, debit networks, web-based services, and digital currencies. Our
continued growth depends upon our ability to compete effectively with these alternative technologies.
Developments in payments could materially reduce our transaction levels and revenues.
Certain developments in the field of payments may reduce the need for ATMs, prepaid product POS terminals and money transfer
agents. An example of this type of development is the use of near field technology in retail transactions, which if widely accepted in a
market reduces the need for cash and can negatively impact the level of ATM transactions in that market. Advances in biometric
payment solutions could have similar adverse impacts. These developments may reduce the transaction levels that we experience on
our networks in the markets where they occur. Financial institutions, retailers and agents could elect to increase fees to their customers
for using our services, which may cause a decline in the use of our services and have an adverse effect on our revenues. If transaction
levels over our existing network of ATMs, POS terminals, agents and other distribution methods do not increase, growth in our
revenues will depend primarily on increased capital investment for new sites and developing new markets, which reduces the margin
we realize from our revenues.
The mobile phone industry is a rapidly evolving area, in which technological developments, in particular the development of new
billing models and distribution methods or services, may affect the demand for other services in a dramatic way. The development of
any new models or technology that reduce the need or demand for prepaid mobile airtime could materially and adversely affect our
business.
Competition in our EFT Processing Segment has increased over the last several years, increasing the risk that certain of our
long-term bank outsourcing contracts may be terminated or not renewed upon expiration.
The developing markets in which we have done business have matured over the years, resulting in increasing competition. In addition,
as consolidation of financial institutions in Central and Eastern Europe continues, certain of our customers have established or are
establishing internal ATM management and processing capabilities. As a result of these developments, negotiations regarding renewal
of contracts have become increasingly challenging and in certain cases we have reduced fees to extend contracts beyond their original
terms. In certain other cases, contracts have been, and in the future may be, terminated by financial institutions resulting in a
substantial reduction in revenue. Contract termination payments, if any, may be inadequate to replace revenues and operating income
associated with these contracts.
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Euronet | 2023 Annual Report
GOVERNANCE MATTERS
We have various mechanisms in place to discourage takeover attempts, which may reduce or eliminate our stockholders’
ability to sell their shares for a premium in a change of control transaction.
Various provisions of our certificate of incorporation and bylaws and of Delaware corporate law may discourage, delay or prevent a
change in control or takeover attempt of our company by a third party which our management and board of directors opposes. Public
stockholders who might desire to participate in such a transaction may not have the opportunity to do so. These anti-takeover
provisions could substantially impede the ability of public stockholders to benefit from a change of control or change in our
management and board of directors. These provisions include:
•
•
•
•
•
•
•
•
preferred stock that could be issued by our board of directors to make it more difficult for a third party to acquire, or to
discourage a third party from acquiring, a majority of our outstanding voting stock;
classification of our directors into three classes with respect to the time for which they hold office;
supermajority voting requirements to amend the provision in our certificate of incorporation providing for the classification
of our directors into three such classes;
non-cumulative voting for directors;
control by our board of directors of the size of our board of directors;
limitations on the ability of stockholders to call special meetings of stockholders;
advance notice requirements for nominations of candidates for election to our board of directors or for proposing matters that
can be acted upon by our stockholders at stockholder meetings; and
an exclusive forum bylaw provision for all internal corporate claims.
Additionally, we are authorized to issue up to a total of 90 million shares of common stock, potentially diluting equity ownership of
current holders and the share price of our common stock. We believe that it is necessary to maintain a sufficient number of available
authorized shares of our common stock in order to provide us with the flexibility to issue common stock for business purposes that
may arise as deemed advisable by our Board. These purposes could include, among other things, (i) to declare future stock dividends
or stock splits, which may increase the liquidity of our shares; (ii) the sale of stock to obtain additional capital or to acquire other
companies or businesses, which could enhance our growth strategy or allow us to reduce debt if needed; (iii) use in additional stock
incentive programs and (iv) other bona fide purposes. Our Board of Directors may issue the available authorized shares of common
stock without notice to, or further action by, our stockholders, unless stockholder approval is required by law or the rules of the
Nasdaq Global Select Market. The issuance of additional shares of common stock may significantly dilute the equity ownership of the
current holders of our common stock. Further, over the course of time, all of the issued shares have the potential to be publicly traded,
perhaps in large blocks. This may result in dilution of the market price of the common stock.
An additional 12.5 million shares of common stock, representing approximately 27% of the shares outstanding as of December
31, 2023, could be added to our total common stock outstanding through the exercise of options or the issuance of additional
shares of our common stock pursuant to existing convertible debt and other agreements. Once issued, these shares of common
stock could be traded into the market and result in a decrease in the market price of our common stock.
As of December 31, 2023, we had 5.1 million and 0.8 million options and restricted stock awards outstanding, respectively, held by
our directors, officers and employees, which entitle these holders to acquire an equal number of shares of our common stock. Of this
amount, 2.2 million options are vested and exercisable as of December 31, 2023. Approximately 3.9 million additional shares of our
common stock may be issued in connection with our stock incentive and employee stock purchase plans. Accordingly, based on
current trading prices of our common stock, approximately 3.3 million shares could potentially be added to our total current common
stock outstanding through the exercise of options and the vesting of restricted stock awards, which could adversely impact the trading
price for our stock.
Of the 5.9 million total options and restricted stock awards outstanding, an aggregate of $3.5 million options and restricted stock
awards are held by persons who may be deemed to be our affiliates and who would be subject to Rule 144. Thus, upon exercise of
their options or sale of shares for which restrictions have lapsed, these affiliates’ shares would be subject to the trading restrictions
imposed by Rule 144. The remainder of the common shares issuable under option and restricted stock award arrangements would be
freely tradable in the public market. Over the course of time, all of the issued shares have the potential to be publicly traded, perhaps
in large blocks.
A Network of Enablement
49
Upon the occurrence of certain events, another 2.8 million shares of common stock could be issued upon conversion of the Company’s
convertible notes issued in March 2019; in certain situations, the number of shares issuable could be higher. While we have stated that
we intend to settle any conversion of these notes by issuing cash for the principal value of the notes and issuing shares of common
stock for the conversion value in excess of the principal, which would significantly reduce the number of shares issued upon
conversion, if our financial condition significantly and adversely changes, we may not be able to settle as intended should the notes
be converted.
KEY PERSONNEL
Retaining the founder and key executives of our Company, and of companies that we acquire, and finding and retaining
qualified personnel is important to our continued success, and any inability to attract and retain such personnel could harm
our operations.
The development and implementation of our strategy has depended in large part on our co-founder, Michael J. Brown. The retention
of Mr. Brown is important to our continued success. In addition, the success of the expansion of businesses that we acquire may
depend in large part upon the retention of the founders or leaders of those businesses. Our success also depends in part on our ability
to hire and retain highly skilled and qualified management, operating, marketing, financial and technical personnel. The competition
for qualified personnel in the markets where we conduct our business is intense and, accordingly, we cannot assure you that we will be
able to continue to hire or retain the required personnel.
Our officers and some of our key personnel have entered into service or employment agreements containing non-competition, non-
disclosure, and non-solicitation covenants, which grant incentive stock options and/or restricted stock with long-term vesting
requirements. However, most of these contracts do not guarantee that these individuals will continue their employment with us. The
loss of our key personnel could have a material adverse effect on our business, growth, financial condition, or results of operations.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY RISK MANAGEMENT AND STRATEGY
We recognize that cyber threats are constantly evolving, and we must stay ahead of risks and threats to our business systems, data,
infrastructure, and employees. We take a holistic approach to cybersecurity to proactively mitigate and respond to cyber
threats. Building a robust security program and security controls are critical components that are in the core foundation of our
products, culture, and management oversight. As a financial transaction processor, we ensure security is embedded and regarded with
importance across the organization and within our products and services. We recognize the criticality of maintaining the safety,
security, and integrity of our systems and data to protect our customers, employees, partners, and shareholders. The security program
and cybersecurity strategies are strongly supported by both executive management and our Board of Directors. Our executive
management fosters a strong culture of security awareness and responsibilities from the tone at the top and across all functional teams
at all levels. The security team leadership also conducts segment level Board and/or periodic meetings with segment business
leadership to share security key performance indicators (“KPIs”) and risk considerations, as well as align with business strategies and
gain approval for financial support for cybersecurity resources and tools. Security leadership is also involved in financial forecasting
for security needs and costs, and the Chief Technology Officer (“CTO”) and Chief Financial Officer or executive management team is
involved in understanding and approving security related investments and strategies. We invest in our cybersecurity personnel and
protections to address critical risks to our infrastructure and systems, and we remain dedicated to continuous improvement in our
cybersecurity program.
The Company’s CTO reports to our Chief Executive Officer and has been with Euronet 16 years and is responsible for developing and
implementing our information security program and reporting on cybersecurity matters to the Board of Directors (the “Board”). Many
on our Information Technology (“IT”) security team leadership have over a decade of cybersecurity and IT control experience,
certifications, and external and internal IT audit experience. The Chief Information Security Officer (“CISO”) reports to executive
management independent of IT and is responsible for management of cybersecurity risk, security governance and compliance, security
policies, security training, and the overall protection and defense of our networks, systems, and company data. The CISO manages the
global security governance, risk, and compliance teams and is responsible for ensuring we meet our regulatory and compliance
requirements as related to PCI DSS, ISO 27001, and other certifications we hold globally that support our business products and
services. The Global Director of Cybersecurity reports to the CTO and manages our security toolbelt and implementations, incident
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Euronet | 2023 Annual Report
response, alert management, and various technical security teams. The CISO and Global Director of Cybersecurity manage teams of
cybersecurity professionals with broad experience and expertise, including PCI and other regulatory compliance, threat assessments
and detection, forensic investigations, mitigation technologies, cybersecurity training, incident response, insider threats, third party
risk, penetration testing, and security engineering expertise. Many members of the security leadership team across the organization
have been with Euronet for more than 10 years. The global and segment security leadership teams work closely with legal, privacy,
audit, and compliance teams to ensure we meet regulatory requirements and work together to address cyber risks in all functional
areas of the organization. We also conduct strategic in person and virtual annual, quarterly, and monthly security meetings with key
members of security and IT leadership to align on security priorities, initiatives, and requirements.
Our Board of Directors is responsible for overseeing our enterprise risk management activities in general, and each of our Board
committees assists the Board in the role of risk oversight. The full Board receives an update on our risk management process and the
risk trends related to cybersecurity at least annually. The CTO attends all quarterly Board meetings and presents to the Board at a
minimum of twice per year on security and cybersecurity KPIs and threat mitigations. The Audit Committee oversees risks including
cybersecurity risks. Our internal audit team reports on cybersecurity risks and internal and external audit results to the Audit
Committee. Internal Audit performs IT security and compliance audits for SOX 404 purposes, as well as testing Euronet’s security
standards, and performs pre-assessments for ISO 27001. We also engage third party independent assessments for penetration testing,
vulnerability assessments, and certification such as PCI DSS, ISO 27001, VISA PIN and SOC Type 1 and Type 2 audits. The CTO
and CISO also have weekly and monthly meetings with senior executive management to discuss security strategy, projects, and
concerns. We have an established incident response process led by our CISO governing our assessment, response, and notifications
internally and externally upon the occurrence of a cybersecurity incident. Depending on the nature and severity of an incident, this
process provides for escalating notification to our Chief Executive Officer, executive management team, and the Board as well as
regulatory notifications depending on the jurisdiction and specifications of the incident.
While we evaluate all security incidents and consider the materiality of individual or combined incidents, to date, no incidents or
combination of incidents have materially affected the Company or our financial position, results of operations, and/or cash flows. We
continue to invest in cybersecurity to enhance the design and effectiveness of our internal controls and processes to protect our
systems, networks, and integrity of our data.
Our approach to cybersecurity risk management includes the following key areas:
Risk Management and Policies — Our policies, standards, processes, and practices for assessing, identifying, and managing risks,
including material risks, from cybersecurity threats are integrated into our overall security and risk management program and are
based on frameworks established by the National Institute of Standards and Technology (“NIST”), the International Organization for
Standardization (“ISO”), and other applicable industry standards and best practices. We regularly review and update policies and
procedures with input from IT and security leadership and industry security standards including PCI DSS and ISO. Business segments
and local entities also maintain local policies and procedures that include global requirements and local, statutory, or contractual
requirements and escalations. All employees must sign and acknowledge a Corporate Information Security Policy that outlines their
responsibilities related to IT security, cybersecurity, and protection of company assets and data. In addition to the enterprise risk
assessment presented to the Board, local entity IT and security teams maintain detailed risk assessments that are shared with local
management and are provided for applicable regulatory requirements, as well.
Information Sharing and Collaboration — We subscribe to financial services cyber intelligence and collaboration services, and we
work closely with cyber intelligence and managed security service providers to augment our own security program and controls. We
investigate intelligence sharing platforms to assess potential risks as credible or emerging risks.
Continuous Monitoring — We have security team members across all of our geographic business operations that support our key IT
processing centers. We have teams dedicated to investigating all security alerts and incidents at a global level or within our business
segments. Further, we have managed security service providers who provide 24x7 advanced threat detection and monitoring services
to augment our security analyst teams.
Incident Response — We have a global incident response policy that is shared with key stakeholders and outlines our classification,
escalation, investigation, reporting, and overall response procedures depending on the classification and severity of incidents. Local IT
teams must also create a local incident response plan and playbooks for addressing various types of incidents and handling escalations
and reporting obligations locally. Further, we engage external forensic investigations as necessary to augment our incident reporting
process if deemed critical and/or necessary for prompt response to security incidents which may require a higher technical level
of forensics and/or resources to quickly assess and respond to certain incidents.
A Network of Enablement
51
Training and Awareness — We provide security awareness training to our employees and contractors to help identify, mitigate, and
report on cybersecurity threats. Our employees with network access must complete quarterly security awareness training which
includes multiple interactive and video training modules with passing scores required to complete training compliance. We require
annual PCI DSS and GDPR training as well as any other regulatory required security training. We also perform simulated phishing
campaigns to further test security training effectiveness. We also periodically host tabletop exercises with IT and management to test
and evaluate our incident response plan or playbooks.
Insider Threats — We implement insider threat controls designed to identify, assess, and address potential risks from within our
Company. We implement controls and tools to alert on suspicious or unusual insider activity, and we have rigorous controls in place
to prevent data loss and external sharing of company information. We consider and evaluate potential risks consistent with industry
practices, customer requirements and applicable law, including privacy and other considerations.
Third Party Risk Assessments — We conduct information security assessments before sharing or allowing the hosting of data in
computing environments managed by third parties or allowing third parties to connect to our environment. We also review and amend
legal terms and conditions to ensure there are contractual provisions requiring certain security protections and incident
reporting. We also perform vendor risk assessments to assess the risk of new and existing vendors we conduct business with.
External Assessments — We engage external assessors to evaluate, test, and conclude on the design and effectiveness of security
controls and processes. We engage quality assessors for vulnerability and penetration testing as well as for security certification and/or
regulatory requirements. Further, we have external audits performed by customers, banking and government regulators, and public
accounting firms as part of financial and statutory audit purposes. In 2023, we did not identify any cybersecurity threats that have
materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not
experienced undetected cybersecurity incidents.
For more information on security and cybersecurity threats we face, please see “Risk Factors.”
ITEM 2. PROPERTIES
Our executive offices are located in Leawood, Kansas. As of December 31, 2023, we also have 35 principal offices in Europe, 14 in
Asia Pacific, 10 in North America, three in the Middle East, two in South America and three in Africa. Our office leases generally
provide for initial terms ranging from two to twelve years.
Our processing centers for the EFT Processing Segment are located in Germany, Hungary, India, China, and Pakistan. Processing
centers we operate for the epay Segment are located in the U.K., Germany, Italy, and the U.S. Our processing centers for the Money
Transfer Segment are located in the U.S., the U.K., New Zealand, and Malaysia.
All of our processing centers are leased and have off-site real time backup processing centers that are capable of providing full or
partial processing services in the event of failure of the primary processing centers.
ITEM 3. LEGAL PROCEEDINGS
The Company is, from time to time, a party to legal or regulatory proceedings arising in the ordinary course of its business.
The discussion regarding litigation in Part II, Item 8 – Financial Statements and Supplementary Data and Note 20, Litigation and
Contingencies, to the Consolidated Financial Statements included elsewhere in this report is incorporated herein by reference.
Currently, there are no legal or regulatory proceedings that management believes, either individually or in the aggregate, would have a
material adverse effect upon the Consolidated Financial Statements of the Company. In accordance with U.S. Generally Accepted
Accounting Principles (“U.S. GAAP”), we record a liability when it is both probable that a liability has been incurred and the amount
of the loss can be reasonably estimated. These liabilities are reviewed at least quarterly and adjusted to reflect the impacts of
negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular case
or proceeding.
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Euronet | 2023 Annual Report
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
MARKET INFORMATION
Our common stock, $0.02 par value per share, is quoted on the Nasdaq Global Select Market under the symbol EEFT.
DIVIDENDS
Since our inception, we have not paid dividends on our common stock. We do not intend to distribute dividends for the foreseeable
future.
HOLDERS
At December 31, 2023, we had 50 stockholders of record of our common stock, and none of our preferred stock was outstanding. This
figure does not include an estimate of the indeterminate number of beneficial holders whose shares may be held of record by
brokerage firms and clearing agencies.
PRIVATE PLACEMENTS AND ISSUANCES OF EQUITY
During 2023, we did not issue any equity securities that were not registered under the Securities Act of 1933, which have not been
previously reported in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K.
STOCK PERFORMANCE GRAPH
The following graph compares Euronet Worldwide Inc.’s annual percentage change in cumulative total return on common shares over
the past five years with the cumulative total return of companies comprising the Nasdaq Composite index and the Nasdaq US
Benchmark Financial Services TR Index. This presentation assumes that $100 was invested in shares of the relevant issuers on
December 31, 2018, and that dividends received were immediately invested in additional shares. The graph plots the value of the
initial $100 investment at one-year intervals for the fiscal years shown.
The following performance graph and related text are being furnished to and not filed with the SEC, and will not be deemed to be
“soliciting material” or subject to Regulation 14A or 14C under the Exchange Act or to the liabilities of Section 18 of the Exchange
Act and will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent we specifically incorporate such information by reference into such filing.
A Network of Enablement
53
EQUITY COMPENSATION PLAN INFORMATION
Refer to Part II, Item 8, Financial Statements and Supplementary Data, Note 16, Stock Plans, and Part III, Item 12, Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters, for information related to our equity
compensation plans.
STOCK REPURCHASES
The following table provides information with respect to shares of the Company’s Common Stock that were purchased during the
three months ended December 31, 2023.
Period
October 1 – October 31, 2023
November 1 – November 30, 2023
December 1 – December 31, 2023
Total
Total Number of
Shares Purchased
Average Price Paid
per Share
Total Number
of Shares Purchased
as Part of Publicly
Announced Plans
or Programs
Maximum Dollar Value
of Shares that May Yet
Be Purchased Under the
Programs (in millions)
(1)
49,116 $
__
503,521
552,637 $
79.09
__
99.30
97.50
49,116 $
__
503,521
552,637
496.6
496.6
446.6
1) On September 13, 2022, the Company put a repurchase program in place to repurchase up to $350 million in value, but not more
than 7.0 million shares of common stock through September 13, 2024. As of December 31, 2023, approximately 96.6 million in value
of additional shares were available to be repurchased under this repurchase program. On September 13, 2023, the Company put a
repurchase program in place to repurchase up to $350 million in value, but not more than 7.0 million shares of common stock through
September 13, 2025. As of December 31, 2023, all shares were available to be repurchased under this repurchase
program. Repurchases under the programs may take place in the open market or in privately negotiated transactions, including
derivative transactions, and may be made under a Rule 10b5-1 plan.
ITEM 6. RESERVED
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis should be read in conjunction with the consolidated financial statements and accompanying
notes included elsewhere in this Annual Report on Form 10-K. This section of the Form 10-K generally discusses 2023 items and
year-to-year comparisons between 2023 and 2022.
COMPANY OVERVIEW, GEOGRAPHIC LOCATIONS AND PRINCIPAL PRODUCTS AND SERVICES
Euronet is a leading financial technology solutions and payments provider. We offer payment and transaction processing and
distribution solutions to financial institutions, retailers, service providers and individual consumers. Our primary product offerings
include comprehensive ATM, POS, card outsourcing, card issuing and merchant acquiring services, software solutions, electronic
distribution of prepaid mobile airtime and other electronic payment products, foreign currency exchange services and global money
transfer services. We operate in the following three segments:
1) Our Electronic Funds Transfer (EFT) segment meets the needs of financial institutions and consumers through Euronet-owned and
outsourced ATMs and POS terminals combined with value added and transaction processing services. We deploy and operate our own
ATMs, providing ATM services for financial institutions and providing electronic payment processing solutions. EFT offers a suite of
integrated electronic financial transaction software solutions for electronic payment and transaction delivery systems. Transactions
processed span a network of 47,303 ATMs, as of December 31, 2023, and approximately 656,000 POS terminals.
2) Our epay segment provides retail payment solutions and delivers innovative connections between the digital content of the world’s
leading brands and consumers. epay has one of the largest retail networks across Europe and Asia for the distribution of physical and
digital third-party content, including branded payments, mobile, and alternative payments, partnering with 1,000+ of the world’s
leading brands. In addition, through our own products, we have leveraged our technology to solve business challenges, delivering
scalable solutions to drive efficiency and effectiveness. Our comprehensive range of consumer products simplifies transactions and
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Euronet | 2023 Annual Report
provides financial convenience across a wide range of branded payments. epay operates in 60+ countries. We operate a network that
includes approximately 821,000 POS terminals that enable electronic processing of prepaid mobile airtime “top-up” services and other
digital media content.
3) Our Money Transfer segment provides global money transfers and currency exchange information in retail stores, apps, and
websites through Ria Money Transfer, Xe and the Dandelion cross-border real-time payments network. Euronet’s Money Transfer
segment offers real-time, cross-border payments to consumers and businesses across 198 countries and territories, enabling banks,
fintechs and big tech platforms to integrate an international payments solution into their own platforms. Ria Money Transfer offers
real-time international money transfers with a special focus on emerging markets. In addition, Ria offers safe and affordable money
transfers through a global network of cash locations and online, serving over 20 million customers annually. Xe offers web and app-
based currency information and industry-leading consumer and business cross-border money transfer services. Customers can send
money, buy property overseas, and execute other international payments via the Xe website or app. Dandelion offers consumer and
business transaction processing and fulfillment with alternative payout channels like bank accounts, cash pick-up and mobile wallets.
Dandelion powers cross-border payments for Xe and Ria, as well as third party banks, fintechs, and big tech platforms.
We have six processing centers in Europe, five in Asia Pacific and two in North America. We have 35 principal offices in Europe, 14
in Asia Pacific, 10 in North America, three in the Middle East, two in South America and three in Africa. Our executive offices are
located in Leawood, Kansas, USA. With approximately 76% of our revenues denominated in currencies other than the U.S. dollar, any
significant changes in foreign currency exchange rates will likely have a significant impact on our results of operations (for a further
discussion, see Item 1A – Risk Factors and Item 7A – Quantitative and Qualitative Disclosures About Market Risk).
SOURCES OF REVENUES AND CASH FLOW
Euronet earns revenues and income primarily from ATM management fees, transaction fees, commissions, and foreign currency
exchange margin. Each operating segment’s sources of revenue are described below.
EFT Processing Segment — Revenues in the EFT Processing Segment, which represented approximately 29% of total consolidated
revenues for the year ended December 31, 2023, are derived from fees charged for transactions made by cardholders on our
proprietary network of ATMs, fixed management fees and transaction fees we charge to customers for operating ATMs and
processing debit and credit cards under outsourcing and cross-border acquiring agreements, foreign currency exchange margin on
DCC transactions, domestic and international surcharge, foreign currency dispensing and other value added services such as
advertising, prepaid telecommunication recharges, bill payment, and money transfers provided over ATMs. Revenues in this segment
are also derived from cardless payments, banknote recycling, tax refund services, license fees, professional services and maintenance
fees for proprietary application software and sales of related hardware.
epay Segment — Revenues in the epay Segment, which represented approximately 29% of total consolidated revenues for the year
ended December 31, 2023, are primarily derived from commissions or processing fees received from mobile phone operators for the
processing and distribution of prepaid mobile airtime and commissions earned from the distribution of other electronic content,
vouchers, and physical gifts. The proportion of epay Segment revenues earned from the distribution of prepaid mobile phone time as
compared with other electronic products has decreased over time, and digital media content now produces approximately 67% of epay
Segment revenues. Other electronic content offered by this segment includes digital content such as music, games, and software, as
well as other products including prepaid long distance calling card plans, prepaid Internet plans, prepaid debit cards, gift cards,
vouchers, transport payments, lottery payments, bill payment, and money transfer.
Money Transfer Segment — Revenues in the Money Transfer Segment, which represented approximately 42% of total consolidated
revenues for the year ended December 31, 2023, are primarily derived from transaction fees, as well as the margin earned from
purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates. We
have a sending agent network in place comprised of agents, customer service representatives, Company-owned stores, primarily in
North America, Europe and Malaysia, Ria, and xe branded websites, along with a worldwide network of correspondent agents,
consisting primarily of financial institutions in the transfer destination countries. Under the brand “Dandelion”, Ria offers payment
processing
financial
institutions, fintechs such as digital wallets and banks, and enterprise software companies access to Euronet’s money transfer network
through an API connection. Sending and correspondent agents each earn fees for cash collection and distribution services, which are
recognized as direct operating costs at the time of sale.
cross-border payments platform provides
third party partners. The Dandelion
services
to
A Network of Enablement
55
Corporate Services, Eliminations and Other — In addition to operating in our principal operating segments described above, our
“Corporate Services, Eliminations and Other” category includes non-operating activity, certain inter-segment eliminations and the cost
of providing corporate and other administrative services to the operating segments, including most share-based compensation
expenses. These services are not directly identifiable with our reportable operating segments.
OPPORTUNITIES AND CHALLENGES
The global product markets in which we operate are large and fragmented, which poses both opportunities and challenges for our
technology to disrupt new and existing competition. As an organization, our focus is on increasing our market presence through both
physical (ATMs, POS terminals, stores, and agent correspondents) and digital assets and providing new and improved products and
services for customers through all of our channels, which may in turn drive an increase in the number of transactions on our networks.
Each of these opportunities also presents us with challenges, including differentiating our portfolio of products and services in highly
competitive markets, the successful development and implementation of our software products and access to financing for expansion.
1) The EFT Processing Segment opportunities include physical expansion into target markets, developing value added products or
services, increasing high value DCC and surcharge transactions and efficiently leveraging our portfolio of software solutions. Our
opportunities are dependent on renewing and expanding our card acceptance, ATM and POS management and outsourcing, cash
supply and other commercial agreements with customers and financial institutions. Operational challenges in the EFT Processing
Segment include obtaining and maintaining the required licenses and sponsorship agreements in markets in which we operate and
navigating frequently changing rules imposed by international card organizations, such as Visa® and Mastercard®, that govern ATM
interchange fees, direct access fees and other restrictions. Our profitability is dependent on the laws and regulations that govern DCC
transactions, specifically in the E.U., increasing expansion of prepaid forex cards, as well as the laws and regulations of each country
that we operate in that may impact the volume of cross-border and cross-currency transactions. The timing and amount of revenues in
the EFT Processing Segment is uncertain and unpredictable due to inherent limitations in managing our estate of ATMs, which is
dependent on contracts that cover large numbers of ATMs, which are complicated by legal and regulatory considerations of local
countries, as well as our customers’ decisions whether to outsource ATMs.
2) The epay Segment opportunities include renewing existing and negotiating new agreements in target markets in which we operate,
primarily with mobile operators, digital content providers, financial institutions, and retailers. The overall growth rate in the prepaid
mobile phone and digital media content markets, shifts between prepaid and postpaid services, and our market share in those
respective markets will have a significant impact on our ability to maintain and grow the epay Segment revenues. There is significant
competition in these markets that may impact our ability to grow organically and increase the margin we earn and the margin that we
pay to retailers. The profitability of the epay Segment is dependent on our ability to adapt to new technologies that may compete with
POS distribution of digital content and prepaid mobile airtime, as well as our ability to leverage cross-selling opportunities with our
EFT and Money Transfer Segments. The epay Segment opportunities may be impacted by government-imposed restrictions on
retailers and/or content providers with whom we partner in countries in which we have a presence, and corresponding licensure
requirements mandated upon such parties to legally operate in such countries.
3)The Money Transfer Segment opportunities include expanding our portfolio of products and services to new and existing customers
around the globe, which in turn may lead to an increase in transaction volumes. The opportunities to expand are contingent on our
ability to effectively leverage our network of bank accounts for digital money transfer delivery, maintaining our physical agent
network, cross selling opportunities with our EFT and epay segments and our penetration into high growth money transfer corridors.
The challenges inherit in these opportunities include maintaining compliance with all regulatory requirements, maintaining all
required licenses, ensuring the recoverability of funds advanced to agents and the continued reliance on the technologies required to
operate our business. The volume of transactions processed on our network is impacted by shifts in our customer base, which can
change rapidly with worker migration patterns and changes in unbanked populations across the globe. Foreign regulations that impact
cross-border migration patterns and the money transfer markets can significantly impact our ability to grow the number of transactions
on our network.
For all segments, our continued expansion may involve additional acquisitions that could divert our resources and management time
and require integration of new assets with our existing networks and services. Our ability to effectively manage our growth has
required us to expand our operating systems and employee base, particularly at the management level, which has added incremental
operating costs. An inability to continue to effectively manage expansion could have a material adverse effect on our business, growth,
financial condition, or results of operations. Inadequate technology and resources would impair our ability to maintain current
processing technology and efficiencies, as well as deliver new and innovative services to compete in the marketplace.
56
Euronet | 2023 Annual Report
SEGMENT REVENUES AND OPERATING INCOME FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022
Revenues
Operating Income (Expense)
(in millions)
EFT Processing
epay
Money Transfer
Total
Corporate services, eliminations and other
Total
SUMMARY
2022
2023
2022
$
2023
1,058.3 $
1,082.4
1,555.2
3,695.9
(7.9 )
924.2 $
997.9
1,444.5
3,366.6
(7.8 )
206.3 $
126.2
185.4
517.9
(85.3 )
$
3,688.0 $
3,358.8 $
432.6 $
184.0
120.7
154.5
459.2
(73.8 )
385.4
Our annual consolidated revenues increased by 9.8% for 2023 compared to 2022. The increase in revenues for 2023 was primarily due
to the increases in transaction volumes across all three segments.
Our annual consolidated operating income increased by 12.2% for 2023 compared to 2022. The increase in operating income for 2023
was primarily due to the increases in transaction volumes across all three segments.
Net income attributable to Euronet for 2023 was $279.7 million, or $5.50 per diluted share compared to a net income attributable to
Euronet for 2022 of $231.0 million, or $4.41 per diluted share.
Impact of changes in foreign currency exchange rates
Our revenues and local expenses are recorded in the functional currencies of our operating entities, and then are translated into U.S.
dollars for reporting purposes; therefore, amounts we earn outside the U.S. are negatively impacted by a stronger U.S. dollar and
positively impacted by a weaker U.S. dollar. Considering the results by country and the associated functional currency, our 2023
consolidated operating income was approximately 0.2% higher due to changes in foreign currency exchange rates when compared to
2022. If significant, in our discussion we will refer to the impact of fluctuations in foreign currency exchange rates in our comparison
of operating segment results.
To provide further perspective on the impact of foreign currency exchange rates, the following table shows the changes in values
relative to the U.S. dollar during 2023 and 2022, of the currencies of the countries in which we have our most significant operations:
Currency
Australian dollar
British pound
Canadian dollar
euro
Hungarian forint
Indian rupee
Malaysian ringgit
New Zealand dollar
Polish zloty
A Network of Enablement
Average Translation Rate Year
Ended December 31,
2023
2022
2023 Increase
(Decrease)
Percent
$
$
$
$
$
$
$
$
$
0.6644 $
0.6949
1.2435 $
1.2374
0.7412 $
0.7691
1.0813 $
1.0541
0.0028 $
0.0027
0.0121 $
0.0127
0.2197 $
0.2278
0.6141 $
0.6361
0.2385 $
0.2255
(4.4) %
0.5 %
(3.6) %
2.6 %
3.7 %
(4.7) %
(3.6) %
(3.5) %
5.8 %
57
COMPARISON OF OPERATING RESULTS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 — BY
OPERATING SEGMENT
EFT PROCESSING SEGMENT
The following table summarizes the results of operations for our EFT Processing Segment for the years ended December 31,
2023 and 2022:
(dollar amounts in millions)
Total revenues
Operating expenses:
Direct operating costs
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
Operating income
Transactions processed (millions)
Active ATMs as of December 31
Average active ATMs
Revenues
Year Ended December 31,
2023
2022
Year-over-Year Change
Increase
(Decrease)
Percent
Increase
(Decrease)
Amount
$
1,058.3 $
924.2 $
134.1
14.5 %
572.1
126.5
58.8
94.6
475.8
111.9
57.1
95.4
852.0
740.2
206.3 $
8,473
184.0 $
6,459
47,303
45,009
49,080
47,166
96.3
14.6
1.7
(0.8 )
111.8
22.3
2,014
2,294
1,914
20.2 %
13.0 %
3.0 %
(0.8) %
15.1 %
12.1 %
31.2 %
5.1 %
4.1 %
$
EFT Processing Segment total revenues were $1,058.3 million for the year ended December 31, 2023, an increase of $134.1 million or
14.5% compared to the same period in 2022. Revenues increased for the year ended December 31,2023 compared to the same period
in 2022 due to an increase in average active ATMs, an increase in our most profitable international transactions driven by cross-border
recovery levels, corresponding DCC and surcharge revenues and continued expansion to new markets. Foreign currency
movements increased revenues by approximately $9.3 million for the year ended December 31, 2023, compared to the same period
in 2022.
Revenue per transaction was $0.12 for the year ended December 31, 2023, compared to $0.14 for the same period in 2022. The
decrease in revenue per transaction was driven by an increase in high volume low value transactions initiated through digital wallets.
Average monthly revenues per ATM increased to $1,797 for the year ended December 31, 2023 compared to $1,633 for the same
period in 2022.
Direct operating costs
EFT Processing Segment direct operating costs were $572.1 million for the year ended December 31, 2023, an increase of $96.3
million or 20.2% compared to the same period in 2022. Direct operating costs primarily consist of site rental fees, cash delivery costs,
cash supply costs, maintenance, insurance, telecommunications, payment scheme processing fees, data center operations-related
personnel, as well as the processing centers’ facility-related costs and other processing center-related expenses and commissions paid
to retail merchants, banks and card processors involved with POS DCC transactions. For the year ended December 31, 2023, the
increase in direct operating costs was primarily due to the increase in transaction volumes, and costs associated with modifying our
estate of ATMs. Foreign currency movements increased direct operating costs by approximately $7.9 million for the year ended
December 31, 2023 compared to the same period in 2022.
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Euronet | 2023 Annual Report
Gross profit
Gross profit, which is calculated as revenues less direct operating costs, was $486.2 million for the year ended December 31, 2023, an
increase of $37.8 million or 8.4% compared to $448.4 million for the same period in 2022. Gross profit as a percentage of revenues
(“gross margin”) decreased to 45.9% for the year ended December 31, 2023, compared to 48.5% for the same period in 2022. For the
year ended December 31, 2023, the increase in gross profit was primarily driven by the revenue increase from additional transaction
volumes into new geographies.
Salaries and benefits
Salaries and benefits expenses were $126.5 million for the year ended December 31, 2023, an increase of $14.6 million or 13.0%
compared to the same period in 2022. The increase in salaries and benefits for the year ended December 31, 2023 compared to the
same period in 2022 was primarily driven by an increased headcount and an increase in pay rate and bonuses. As a percentage of
revenues, these expenses decreased to 12.0% for the year ended December 31, 2023, compared to 12.1% for the same period in 2022.
Selling, general and administrative
Selling, general and administrative expenses were $58.8 million for the year ended December 31, 2023, an increase of $1.7 million or
3.0% compared to the same period in 2022. As a percentage of revenues, these expenses decreased to 5.6% for the year ended
December 31, 2023, compared to 6.2% for the same period in 2022.
Depreciation and amortization
Depreciation and amortization expenses were $94.6 million for the year ended December 31, 2023, a decrease of $0.8 million or
0.8% compared to the same period in 2022. As a percentage of revenues, these expenses decreased to 8.9% for the year ended
December 31, 2023, compared to 10.3% for the same period in 2023.
Operating income
EFT Processing Segment had operating income of $206.3 million for the year ended December 31, 2023, compared to operating
income of $184.0 million in 2022, an increase of $22.3 million compared to the same period in 2022. Operating income as a
percentage of revenues (“operating margin”) decreased to 19.5% for the year ended December 31, 2023, compared to 19.9% for the
same period in 2022. Operating income per transaction was $0.02 for the year ended December 31, 2023, compared to $0.03 for the
same period in 2022. For the year ended December 31, 2023, the increase in operating income and decrease in operating margin was
primarily driven by the increase in the number of transactions processed in a region where we generally earn lower revenues
per transaction.
epay SEGMENT
The following table summarizes the results of operations for our epay Segment for the years ended December 31, 2023 and 2022:
(dollar amounts in millions)
Total revenues
Operating expenses:
Direct operating costs
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
Operating income
Transactions processed (billions)
Year Ended December 31,
2023
2022
Year-over-Year Change
Increase
(Decrease)
Percent
Increase
Amount
$
1,082.4 $
997.9 $
84.5
8.5 %
819.1
91.1
39.1
6.9
753.2
81.8
36.0
6.2
956.2
877.2
$
126.2 $
120.7 $
65.9
9.3
3.1
0.7
79.0
5.5
8.7 %
11.4 %
8.6 %
11.3 %
9.0 %
4.6 %
3.79
3.86
(0.07 )
(1.8) %
A Network of Enablement
59
Revenues
epay Segment total revenues were $1,082.4 million for the year ended December 31, 2023, an increase of $84.5 million or 8.5%
compared to the same period in 2022. Foreign currency movements increased revenues by approximately $11.4 million for the year
ended December 31, 2023, compared to the same period in 2022. The increase in revenues was driven by continued expansion of
digital media and mobile sales. Revenues per transaction increased to $0.29 for the year ended December 31, 2023, compared
to $0.26 for the same period in 2022. The increase in revenues per transaction was primarily driven by a decrease in the number of
low-margin mobile transactions processed in a region where we generally earn lower revenues per transaction.
Direct operating costs
epay Segment direct operating costs were $819.1 million for the year ended December 31, 2023, an increase of $65.9 million or
8.7% compared to the same period in 2022. Direct operating costs primarily consist of the commissions paid to retail merchants for
the distribution and sale of prepaid mobile airtime and other prepaid products, expenses incurred to operate POS terminals and the cost
of vouchers sold and physical gifts fulfilled. The increase in direct operating costs was primarily due to an increase in cost for
transaction volumes of low-value mobile top-up transactions and an increase in retailer commissions. Foreign currency movements
increased these expenses by $9.9 million for the year ended December 31, 2023, compared to the same period in 2022.
Gross profit
Gross profit was $263.3 million for the year ended December 31, 2023, an increase of $18.6 million or 7.6% compared to $244.7
million for the same period in 2022. Gross margin decreased to 24.3% for the year ended December 31, 2023, compared to 24.5% for
the same period in 2022.
Salaries and benefits
Salaries and benefits expenses were $91.1 million for the year ended December 31, 2023, an increase of $9.3 million or 11.4%
compared to the same period in 2022. The increase in salaries and benefits was primarily driven by an increase in headcount to
support the growth of the business and an increase in bonus expenses. As a percentage of revenues, these expenses increased to 8.4%
for the year ended December 31, 2023, compared to 8.2% for the year ended December 31, 2022.
Selling, general and administrative
Selling, general and administrative expenses were $39.1 million for the year ended December 31, 2023, an increase of $3.1 million or
8.6% compared to the same period in 2022. As a percentage of revenues, these expenses were 3.6% for the year ended December 31,
2023, and 2022, respectively.
Depreciation and amortization
Depreciation and amortization expenses were $6.9 million for the year ended December 31, 2023, an increase of $0.7 million or
11.3% compared to the same period in 2022. Depreciation and amortization expense primarily represents depreciation of POS
terminals we install in retail stores and amortization of acquired intangible assets. As a percentage of revenues, these expenses
were 0.6% for the year ended December 31, 2023, and 2022, respectively.
Operating income
epay Segment operating income was $126.2 million for the year ended December 31, 2023, an increase of $5.5 million or 4.6%
compared to the same period in 2022. Operating margin decreased to 11.7% for the year ended December 31, 2023, compared to
12.1% for the same period in 2022. Operating income per transaction was $0.03 for the year ended December 31, 2023, and 2022,
respectively. The increase in operating income was primarily driven by the increase in transactions.
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Euronet | 2023 Annual Report
MONEY TRANSFER SEGMENT
The following table summarizes the results of operations for our Money Transfer Segment for the years ended December 31, 2023
and 2022:
(dollar amounts in millions)
Total revenues
Operating expenses:
Direct operating costs
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
Operating income
Transactions processed (millions)
Revenues
Year Ended December 31,
Year-over-Year Change
2023
1,555.2 $
2022
1,444.5 $
$
Increase
(Decrease)
Amount
Increase
(Decrease)
Percent
110.7
7.7 %
839.5
310.5
188.8
796.9
277.0
182.2
31.0
1,369.8
33.9
1,290.0
$
185.4 $
161.7
154.5 $
147.9
42.6
33.5
6.6
(2.9 )
79.8
30.9
13.8
5.3 %
12.1 %
3.6 %
(8.6) %
6.2 %
20.0 %
9.3 %
Money Transfer Segment total revenues were $1,555.2 million for the year ended December 31, 2023, an increase of $110.7 million
or 7.7% compared to the same period in 2022. The increase in revenues was primarily due to 9.6% growth in US-outbound
transactions, 12.1% growth in international-originated money transfers – which included 9.9% growth from Americas outside the US,
12.0% growth in transfers initiated largely in Europe and 14.3% growth in transfers initiated in the Middle East and Asia, and 15.5%
growth in xe transactions, partially offset by a 15.5% decline in the intra-US business. These transaction growth rates include 25.6%
growth in direct-to-consumer digital transactions. Revenues per transaction decreased to $9.62 for the year ended December 31, 2023,
compared to $9.77 for the same period in 2022. Foreign currency movements increased revenues by approximately $8.7 million for
the year compared to the same period in 2022.
Direct operating costs
Money Transfer Segment direct operating costs were $839.5 million for the year ended December 31, 2023, an increase of $42.6
million compared to the same period in 2022. Direct operating costs primarily consist of commissions paid to agents who originate
money transfers on our behalf and correspondent agents who disburse funds to the customers’ destination beneficiaries, together with
less significant costs, such as bank depository fees. The increase in direct operating costs was primarily due to the increase in the
number of U.S. outbound and international-originated money transfer transactions and corresponding increase in agent commissions.
Foreign currency movements increased direct operating costs by approximately $4.9 million for the year ended December 31, 2023,
compared to the same period in 2022.
Gross profit
Gross profit was $715.7 million for the year ended December 31, 2023, an increase of $68.1 million or 10.5% compared to $647.6
million for the same period in 2022. Gross margin increased to 46.0% for the year ended December 31, 2023, compared to 44.8% for
the same period in 2022. The increase in gross profit was primarily attributable to the increase in transaction volume and relative
decrease of agent commissions for the year ended December 31, 2023.
Salaries and benefits
Salaries and benefits expenses were $310.5 million for the year ended December 31, 2023, an increase of $33.5 million or 12.1%
compared to the same period in 2022. The increase in salaries and benefits was primarily driven by an increase in headcount to
support the growth of the business. As a percentage of revenues, these expenses increased to 20.0% for the year ended December 31,
2023, compared to 19.2% for the same period in 2022.
A Network of Enablement
61
Selling, general and administrative
Selling, general and administrative expenses were $188.8 million for the year ended December 31, 2023, an increase of $6.6 million
or 3.6% compared to the same period in 2022. The increase in these expenses was primarily driven by an increase in professional fees,
product hardware, software, and travel-related expenses. As a percentage of revenues, these expenses decreased to 12.1% for the year
ended December 31, 2023, compared to 12.6% for the same period in 2022.
Depreciation and amortization
Depreciation and amortization expenses were $31.0 million for the year ended December 31, 2023, a decrease of ($2.9) million or
(8.6%) compared to the same period in 2022. Depreciation and amortization primarily represent amortization of acquired intangible
assets and depreciation of money transfer terminals, computers and software, leasehold improvements, and office equipment. As a
percentage of revenues, these expenses decreased to 2.0% for the year ended December 31, 2023, compared to 2.3% for the same
period in 2022.
Operating income
Money Transfer Segment operating income was $185.4 million for the year ended December 31, 2023, an increase of $30.9 million or
20.0% compared to the same period in 2022. Operating margin increased to 11.9% for the year ended December 31, 2023, compared
to 10.7% for the same period in 2022. Operating income per transaction increased to $1.15 for the year ended December 31, 2023,
compared to $1.04 for the same period in 2022. The increase in operating income, operating margin, and operating income per
transaction for the year ended December 31, 2023 compared to the same period in 2022 was primarily driven by the increase in
transaction volume, specifically the higher margin transactions for US outbound and international-originated money transfers, partially
offset by the increase in agent commissions, and an increase in headcount to support the growth of the business.
CORPORATE SERVICES
The following table summarizes the results of operations for Corporate Services for the years ended December 31, 2023 and 2022:
(dollar amounts in millions)
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
Corporate operating expenses
Year Ended December 31,
Year-over-Year Change
2023
2022
Increase
(Decrease)
Amount
Increase
(Decrease)
Percent
$
74.8 $
10.1
0.4
63.5 $
9.8
0.4
$
85.3 $
73.7 $
11.3
0.3
-
11.6
17.8 %
3.1 %
— %
15.7 %
Total Corporate operating expenses were $85.3 million for the year ended December 31, 2023, an increase of $11.6 million or
15.7%, compared to the same period in 2022. The increase was primarily due to an increase in share-based compensation and bonuses
as a result of improved performance for the year ended December 31, 2023, compared to the same period in 2022.
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Euronet | 2023 Annual Report
OTHER EXPENSE, NET
(dollar amounts in millions)
Interest income
Interest expense
Foreign currency exchange gain / (loss), net
Other gains, net
Other expense, net
Year Ended December 31,
Year-over-Year Change
2023
2022
$
$
15.2 $
(55.6 )
8.0
0.2
(32.2 ) $
Increase
(Decrease) Amount
13.2
(18.1 )
36.2
(0.7 )
30.6
Increase
(Decrease) Percent
660.0 %
48.3 %
(128.4) %
(77.8) %
(48.7) %
2.0 $
(37.5 )
(28.2 )
0.9
(62.8 ) $
Interest income and interest expense increased in 2023 compared to 2022 due to an increase in the variable interest rates.
Foreign currency exchange loss, net
Foreign currency exchange activity includes gains and losses on certain foreign currency exchange derivative contracts and the impact
of re-measurement of assets and liabilities denominated in foreign currencies. Assets and liabilities denominated in currencies other
than the local currency of each of our subsidiaries give rise to foreign currency exchange gains and losses. Foreign currency exchange
gains and losses that result from re-measurement of these assets and liabilities are recorded in net income. The majority of our foreign
currency exchange gains or losses are due to the re-measurement of intercompany loans which are not considered a long-term
investment in nature and are in a currency other than the functional currency of one of the parties to the loan. For example, we make
intercompany loans based in euros from our corporate division, which is composed of U.S. dollar functional currency entities, to
certain European entities that use the euro as the functional currency. As the U.S. dollar strengthens against the euro, foreign currency
exchange losses are recognized by our corporate entities because the number of euros to be received in settlement of the loans
decreases in U.S. dollar terms. Conversely, in this example, in periods where the U.S. dollar weakens, our corporate entities will
record foreign currency exchange gains.
We recorded a net foreign currency exchange gain of $8.0 million for the year ended December 31, 2023, compared to a net foreign
currency exchange loss of $28.2 million for the same period in 2022. These realized and unrealized foreign currency exchange gains
and losses reflect the fluctuation in the value of the U.S. dollar against the currencies of the countries in which we operated during the
respective periods.
INCOME TAX EXPENSE
Our effective income tax rates as reported and as adjusted are calculated below:
(dollar amounts in millions)
Income before income taxes
Income tax expense
Net income
Effective income tax rate
Income before income taxes
Adjust: Other gains, net
Adjust: Foreign currency exchange gain (loss), net
Income before income taxes, as adjusted
Income tax expense
Adjust: Income tax attributable to foreign currency exchange gain (loss), net
Income tax expense, as adjusted
Effective income tax rate, as adjusted
Year Ended December 31,
2023
2022
$
400.4 $
(120.9 )
$
279.5 $
322.6
(91.9 )
230.7
30.2 %
28.5 %
$
400.4 $
0.2
8.0
$
$
$
392.2 $
(120.9 )
4.7
(125.6 )
$
$
322.6
0.9
(28.2 )
349.9
(91.9 )
(12.5 )
(79.4 )
32.0 %
22.7 %
A Network of Enablement
63
We calculate our effective income tax rate by dividing income tax expense by pre-tax book income. Our effective income tax rates
were 30.2% and 28.5% for the years ended December 31, 2023 and 2022, respectively. The effective income tax rates were
significantly influenced by the impact of foreign currency exchange gains (losses). Excluding foreign currency exchange gains
(losses) as well as the related tax effects for these items, our adjusted effective income tax rates were 32.0% and 22.7% for the years
ended December 31, 2023 and 2022, respectively.
The effective income tax rate, as adjusted, for 2023 was higher than the applicable statutory income tax rate of 21% primarily because
of the projected utilization of U.S. tax benefits, and certain foreign earnings being subject to higher local statutory tax rates. The
effective income tax rate, as adjusted, for 2022 was higher than the applicable statutory income tax rate of 21% as a result of the non-
recognition of tax benefits from losses in certain foreign countries where we have a limited history of profitable earnings and certain
foreign earnings being subject to higher local statutory tax rates. The effective income tax rate, as adjusted, was offset by a decrease in
the valuation allowance related to the projected utilization of U.S. tax benefits. We determine income tax expense based upon enacted
tax laws applicable in each of the taxing jurisdictions where we conduct business. Based on our interpretation of such laws and
considering the evidence of available facts and circumstances and baseline operating forecasts, we have accrued the estimated income
tax effects of certain transactions, business ventures, contract and organizational structures, and the estimated future reversal of timing
differences. Should a taxing jurisdiction change its laws or dispute our conclusions, or should management become aware of new facts
or other evidence that could alter our conclusions, the resulting impact to our estimates could have a material adverse effect on our
results of operations and financial condition.
Income before income taxes, as adjusted, income tax expense, as adjusted and effective income tax rate, as adjusted, are non-U.S.
GAAP financial measures that management believes are useful for understanding why our effective income tax rates are significantly
different than would be expected. These non-U.S. GAAP measures are used by management to conduct and evaluate its business
during its regular review of operating results for the periods presented.
Our total liability for uncertain tax positions under Accounting Standards Codification (“ASC”) 740-10-25 and -30 was $51.8 million
as of December 31, 2023. The application of ASC 740-10-25 and -30 requires significant judgment in assessing the outcome of future
income tax examinations and their potential impact on the Company’s estimated effective income tax rate and the value of deferred
tax assets, such as those related to the Company’s net operating loss carryforwards. It is reasonably possible that the balance of gross
unrecognized tax benefits could significantly change within the next twelve months, as a result of the resolution of audit examinations
and expirations of certain statutes of limitations and, accordingly, materially affect our Consolidated Financial Statements. At this
time, it is not possible to estimate the range of change due to the uncertainty of potential outcomes.
NET (INCOME) LOSS ATTRIBUTABLE TO NON-CONTROLLING INTERESTS
Non-controlling interests represent the elimination of net income or loss attributable to the minority shareholders’ portion of the
following consolidated subsidiaries that are not wholly owned:
Subsidiary
Movilcarga
Euronet China
Euronet Pakistan
Euronet Infinitium Solutions
Percent Owned
95%
85%
70%
65%
Segment – Country
epay – Spain
EFT – China
EFT – Pakistan
EFT – India
NET INCOME (LOSS) ATTRIBUTABLE TO EURONET
Net income attributable to Euronet was $279.7 million for the year ended December 31, 2023, an increase of $48.7 million compared
to net income in the same period in 2022. For the year ended December 31, 2023, the increase in net income was primarily attributable
to the $124.6 million increase in gross profit driven by an increase in transaction volumes across all three segments and the
$36.2 million increase in foreign currencies, partially offset by an $68.7 million increase in salaries and benefits, and a $29.0 million
increase in income tax expense.
TRANSLATION ADJUSTMENT
Translation gains and losses are the result of translating our foreign entities’ balance sheets from local functional currency to the U.S.
dollar reporting currency prior to consolidation and are recorded in comprehensive (loss) income. As required by U.S. GAAP, during
this translation process, asset and liability accounts are translated at current foreign currency exchange rates and equity accounts are
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Euronet | 2023 Annual Report
translated at historical rates. Historical rates represent the rates in effect when the balances in our equity accounts were originally
created. By using this mix of rates to convert the balance sheet from functional currency to U.S. dollars, differences between current
and historical exchange rates generate this translation adjustment.
We recorded a net gain on translation adjustments of $47.9 million for 2023 and a net loss of $78.3 million for 2022. In 2023, the U.S.
dollar weakened compared to key foreign currencies, resulting in translation gains which were recorded in comprehensive (loss)
income. In 2022, the U.S. dollar strengthened compared to key foreign currencies, resulting in translation losses which were recorded
in comprehensive (loss) income.
LIQUIDITY AND CAPITAL RESOURCES
Working capital
As of December 31, 2023, we had working capital of $1,462.1 million, which is calculated as the difference between total current
assets and total current liabilities, compared to working capital of $1,372.7 million as of December 31, 2022. The increase in working
capital was due to several changes in working capital line items, mainly due to 2023 ending in the weekend, which impacts funding
needs for our money transfer agents. Our ratio of current assets to current liabilities was 1.54 and 1.58 at December 31, 2023 and
December 31, 2022, respectively.
We require substantial working capital to finance operations. The Money Transfer Segment funds the payout of the majority of our
consumer-to-consumer money transfer services before receiving the benefit of amounts collected from customers by agents. Working
capital needs increase due to weekends and banking holidays. As a result, we may report more or less working capital for the Money
Transfer Segment based solely upon the day on which the reporting period ends. The epay Segment produces positive working capital,
but much of it is restricted in connection with the administration of its customer collection and vendor remittance activities. In our
EFT Processing Segment, we obtain a significant portion of the cash required to operate our ATMs through various cash supply
arrangements, the amount of which is not recorded on Euronet’s Consolidated Balance Sheets. However, in certain countries, we fund
the cash required to operate our ATM network from borrowings under the revolving credit facilities and cash flows from operations.
As of December 31, 2023, we had approximately $525.2 million of our own cash in use or designated for use in our ATM network,
which is recorded in ATM cash on Euronet’s Consolidated Balance Sheets. ATM cash increased $9.6 million from $515.6 million as
of December 31, 2022 to $525.2 million as of December 31, 2023.
The Company has $1,254.2 million of unrestricted cash as of December 31, 2023 compared to $1,131.2 million as of December 31,
2022. The Company has access to $2,106.8 million in available cash, and $661.2 million available under the Credit Facility with no
significant long-term debt principal payments until March 2025.
We had cash, cash equivalents and restricted cash of $2,247.0 million as of December 31, 2023, of which $1,728.6 million was held
outside of the U.S. and is expected to be indefinitely reinvested for continued use in foreign operations. Repatriation of these assets to
the U.S. could have negative tax consequences.
The following table identifies cash and cash equivalents provided by/(used in) our operating, investing and financing activities for the
years ended December 31, 2023 and 2022 (in millions):
Liquidity
Cash and cash equivalents and restricted cash provided by (used in):
Operating activities
Investing activities
Financing activities
Effect of foreign currency exchange rate changes on cash and cash equivalents and restricted cash
Increase/(Decrease) in cash and cash equivalents and restricted cash
$
Year Ended December 31,
2023
2022
$
643.1 $
(157.6 )
(143.2 )
(86.1 )
256.2 $
748.3
(453.8 )
(1.2 )
(388.6 )
(95.3 )
Operating cash flow
Cash flows provided by operating activities were $643.1 million for the year ended December 31, 2023 compared to $748.3 million
for the same period in 2022. The decrease in operating cash flows was primarily due to the decrease mainly associated with the timing
A Network of Enablement
65
of the settlement processes with content providers in the epay Segment, with correspondents in the Money Transfer Segment, and with
card organizations and banks in the EFT Processing Segment offset by an increase in net income.
Investing activity cash flow
Cash flows used in investing activities were $157.6 million for the year ended December 31, 2023 compared to $453.8 million for the
same period in 2022. We used $94.4 million for purchases of property and equipment for the year ended December 31, 2023
compared to $104.3 million for the same period in 2022. We used $60.0 million for the issuance of Convertible Notes
Receivable. There were no material acquisitions in 2023. In 2022, we used $343.0 million for the acquisition of Piraeus Bank
Merchant Acquiring business of Piraeus Bank.
Financing activity cash flow
Cash flows used in financing activities were $143.2 million for the year ended December 31, 2023 compared to $1.2 million for the
same period in 2022. The increase in cash used in financing activities was primarily the result of the $532.2 million net borrowings on
debt obligations for the year ended December 31, 2023 compared to $171.4 million for the same period in 2022. We repurchased
$378.4 million of common stock during the year ended December 31, 2023 compared to repurchases of $175.0 million for the same
period in 2022. We received proceeds of $7.8 million and $9.1 million during the year ended December 31, 2023 and 2022,
respectively, for the issuance of stock in connection with our Stock Incentive Plan.
Other sources of capital
Credit Facility — On October 24, 2022, the Company amended its revolving credit agreement (the “Credit Facility”) to increase the
facility from $1.03 billion to $1.25 billion and to extend the expiration to October 24, 2027. The revolving credit facility contains a
sublimit of up to $250 million, with $150 million committed, for the issuance of letters of credit, a $75 million sublimit for U.S.
dollar swingline loans and a $75 million sublimit for swingline loans in euros or British pounds sterling. The Credit Facility allows
for borrowings in British pounds sterling, euro and U.S. dollars. Subject to certain conditions, the Company has the option to increase
the Credit Facility by up to an additional $500 million by requesting additional commitments from existing or new lenders. Fees and
interest on borrowings vary based upon the Company’s corporate credit rating and will be based, in the case of letter of credit fees, on
a margin, and in the case of interest, on a margin over a secured overnight financing rate, as defined in the agreement, with a margin,
including the facility fee, ranging from 1.00% to 1.625% or the base rate, as selected by the Company. The applicable margin for
borrowings under the credit facility, based on the Company’s current credit rating is initially 1.25% including the facility fee. As
of December 31, 2023 and 2022, the Company had stand-by letters of credit/bank guarantees outstanding under the Credit Facility
of $51.9 million and $54.6 million, respectively. Stand-by letters of credit/bank guarantees reduce the Company’s borrowing capacity
under the Credit Facility and are generally used to secure trade credit and performance obligations. As of December 31, 2023 and
2022, the stand-by letters of credit interest charges were each 1.25% per annum. Borrowing capacity under the Credit Facility as
of December 31, 2023 was $661.2 million.
Uncommitted Line of Credit — On June 26, 2023, the Company entered into an Uncommitted Loan Agreement for $150 million, fully
drawn and outstanding at December 31, 2023, for the sole purpose of providing vault cash for ATMs, that expires no later than June
21, 2024. The loan is a Prime rate loan, Bloomberg Short-term Bank Yield (“BSBY”) rate loan plus 0.95% or bears interest at the rate
agreed to by the Bank and the Company at the time such loan is made. The weighted-average interest rate from the loan inception date
to December 31, 2023 was 6.29%.
Convertible debt — On March 18, 2019, we completed the sale of $525.0 million in principal amount of Convertible Senior Notes
due 2049 (“Convertible Notes”). The Convertible Notes were issued pursuant to an indenture, dated as of March 18, 2019 (the
“Indenture”), by and between us and U.S. Bank National Association, as trustee. The Convertible Notes have an interest rate of 0.75%
per annum payable semi-annually in March and September and are convertible into shares of Euronet common stock at a conversion
price of approximately $188.73 per share if certain conditions are met (relating to the closing prices of Euronet common stock
exceeding certain thresholds for specified periods). Holders of the Convertible Notes have the option to require us to repurchase for
cash all or part of their Convertible Notes on each of March 15, 2025, 2029, 2034, 2039 and 2044 at a repurchase price equal to 100%
of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the relevant
repurchase date. In connection with the issuance of the Convertible Notes, we recorded $12.8 million in debt issuance costs, which are
being amortized through March 1, 2025.
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Euronet | 2023 Annual Report
Senior Notes — On May 22, 2019, we completed the sale of €600 million ($669.9 million) aggregate principal amount of Senior
Notes that mature in May 2026 (the “Senior Notes”). The Senior Notes accrue interest at a rate of 1.375% per year, payable annually
in arrears commencing May 22, 2020, until maturity or earlier redemption. As of December 31, 2023, we have
outstanding €600 million ($662.2 million) principal amount of the Senior Notes. In addition, the Company may redeem some or all of
these notes on or after February 22, 2026 at their principal amount plus any accrued and unpaid interest. As of December 31, 2023, we
had $2.9 million of unamortized debt issuance costs related to the Senior Notes.
Other debt obligations — Certain of our subsidiaries have available credit lines and overdraft facilities to generally supplement short-
term working capital requirements, when necessary. There were $0.3 million and $0.2 million outstanding under these other obligation
arrangements as of December 31, 2023 and December 31, 2022.
Other uses of capital
Capital expenditures and needs— Total capital expenditures for 2023 were $94.4 million. These capital expenditures were primarily
for the purchase of ATMs to expand our IAD network in Europe, the purchase and installation of ATMs in key under-penetrated
markets, the purchase of POS terminals for the epay and Money Transfer Segments, and office, data center and company store
computer equipment and software. Total capital expenditures for 2024 are currently estimated to be approximately $90 million to
$100 million.
Contractual lease obligations — We have entered into contractually binding operating and finance lease commitments to operate the
business. Operating lease expenses were $50.1 million and $51.0 million for the years ended December 31, 2023 and 2022,
respectively. Finance lease expenses were not material for 2023 or 2022. For additional information on operating and finance lease
obligations, see Note 14, Leases, to the Consolidated Financial Statements.
At current and projected cash flow levels, we anticipate that cash generated from operations, together with cash on hand and amounts
available under our Credit Facility and other existing and potential future financings will be sufficient to meet our debt, leasing, and
capital expenditure obligations. If our capital resources are not sufficient to meet these obligations, we will seek to refinance our debt
and/or issue additional equity under terms acceptable to us. However, we can offer no assurances that we will be able to obtain
favorable terms for the refinancing of any of our debt or other obligations or for the issuance of additional equity.
Share repurchase plan
On December 8, 2021, we put a repurchase program in place to repurchase up to $300 million in value, but not more than 5.0 million
shares of common stock through December 8, 2023. For the year ended December 31, 2023, the Company repurchased
1,400,229 shares under the repurchase program at a weighted average purchase price of $89.31 for a total value of $125.0 million.
On September 13, 2022, we put a repurchase program in place to repurchase up to $350 million in value, but not more than 7.0 million
shares of common stock through September 13, 2024. For the year ended December 31, 2023, we repurchased 2,936,667 shares under
the repurchase program at a weighted average purchase price of $86.27 for a total value of $253.4 million.
On September 13, 2023, the Company put a repurchase program in place to repurchase up to $350 million in value, but not more
than 7.0 million shares of common stock through September 13, 2025. For the year ended December 31, 2023, the Company did not
repurchase shares under this plan.
Repurchases under the programs may take place in the open market or in privately negotiated transactions, including derivative
transactions, and may be made under a Rule 10b5-1 plan.
The Inflation Reduction Act (IRA) was signed into law in August 2022. Among other things, it imposes a 1% excise tax on net
share repurchases.
Inflation and functional currencies
Generally, the countries in which we operate have experienced low and stable inflation in recent years, further the local currency in
each of these markets is the functional currency. Currently, we do not believe that inflation will have a significant effect on our results
of operations or financial position. We continually review inflation and the functional currency in each of the countries where
we operate.
A Network of Enablement
67
Off-balance sheet arrangements
We have certain significant off-balance sheet items described in Note 21, Commitments, to the Consolidated Financial Statements. On
occasion, we grant guarantees of the obligations of our subsidiaries, and we sometimes enter into agreements with unaffiliated third
parties that contain indemnification provisions, the terms of which may vary depending on the negotiated terms of each respective
agreement. Our liability under such indemnification provisions may be subject to time and materiality limitations, monetary caps and
other conditions and defenses. To date, we are not aware of any significant claims made by the indemnified parties or parties to whom
we have provided guarantees on behalf of our subsidiaries and, accordingly, no liabilities have been recorded as of December 31,
2023.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The preparation of financial statements in conformity with U.S. GAAP which requires management to make estimates, judgments and
assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Management
considers an accounting policy and estimate to be critical if it requires the use of assumptions that were uncertain at the time the
estimate was made and if changes in the estimate or selection of a different estimate could have a material effect on the Company’s
financial condition and results of operations. Our most critical estimates and assumptions are used for computing income taxes,
allocating the purchase price to assets acquired and liabilities assumed in acquisitions, and potential impairment of intangible assets
and goodwill. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable
under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results could differ materially from these estimates. For a summary of all of
the Company’s significant accounting policies, see Note 3, Summary of Significant Accounting Policies and Practices, to the
accompanying Consolidated Financial Statements.
Accounting for income taxes
The deferred income tax effects of transactions reported in different periods for financial reporting and income tax return purposes are
recorded under the asset and liability method prescribed under ASC Topic 740, Income Taxes (“ASC 740”). This method gives
consideration to the future tax consequences of deferred income or expense items and immediately recognizes changes in income tax
laws upon enactment. The consolidated statement of operations effect is generally derived from changes in deferred income taxes, net
of valuation allowances, on the balance sheet as measured by differences in the book and tax bases of our assets and liabilities.
We have significant tax loss carryforwards, and other temporary differences, which are recorded as deferred tax assets and liabilities.
Deferred tax assets realizable in future periods are recorded net of a valuation allowance based on an assessment of each entity, or
group of entities’, ability to generate sufficient taxable income within an appropriate period, in a specific tax jurisdiction.
In assessing the recognition of deferred tax assets, we consider whether it is more likely than not that some portion or all of the
deferred tax assets will be realized. As more fully described in Note 15, Income Taxes, to the Consolidated Financial Statements,
gross deferred tax assets were $260.6 million as of December 31, 2023, partially offset by a valuation allowance of $90.7 million. The
ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those
temporary differences become deductible. We make judgments and estimates on the scheduled reversal of deferred tax liabilities,
historical and projected future taxable income in each country in which we operate, and tax planning strategies in making
this assessment.
Based upon the level of historical taxable income and current projections for future taxable income over the periods in which the
deferred tax assets are deductible, we believe it is more likely than not that we will realize the benefits of these deductible differences,
net of the existing valuation allowance at December 31, 2023. If we have a history of generating taxable income in a certain country in
which we operate, and baseline forecasts project continued taxable income in this country, we will reduce the valuation allowance for
those deferred tax assets that we expect to realize.
Additionally, we follow the provisions of ASC 740-10-25 and -30 to account for uncertainty in income tax positions. Applying the
standard requires substantial management judgment and use of estimates in determining whether the impact of a tax position is “more
likely than not” of being sustained on audit by the relevant taxing authority. We consider many factors when evaluating and estimating
our tax positions, which may require periodic adjustments, and which may not accurately anticipate actual outcomes. It is reasonably
possible that amounts reserved for potential exposure could change significantly as a result of the conclusion of tax examinations and,
accordingly, materially affect our operating results.
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Euronet | 2023 Annual Report
Business combinations
In accordance with ASC Topic 805, Business Combinations (“ASC 805”), we allocate the acquisition purchase price of an acquired
entity to the assets acquired, including identifiable intangibles, and liabilities assumed based on their estimated fair values at the date
of acquisition. Management applies various valuation methodologies to these acquired assets and assumed liabilities which often
involve a significant degree of judgment, particularly when liquid markets do not exist for the particular item being valued. Examples
of such items include loans, deposits, identifiable intangible assets and certain other assets and liabilities acquired or assumed in
business combinations. Management uses significant estimates and assumptions to value such items, including projected cash flows
and discount rates. For larger or more complex acquisitions, we generally obtain third-party valuations to assist us in estimating fair
values. The use of different valuation techniques and assumptions could change the amounts and useful lives assigned to the assets
and liabilities acquired and related amortization expense. During the measurement period, which is not to exceed one year from the
acquisition date, we may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill.
Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.
Goodwill and intangible assets
In accordance with ASC Topic 350, Intangibles - Goodwill and Other (“ASC 350”), we evaluate the carrying value of our indefinite-
lived assets, including goodwill, at least annually or more frequently whenever events or changes in circumstances indicate that the
asset may be impaired, or in the case of goodwill, that the fair value of the reporting unit may be less than its carrying amount. Our
annual impairment tests are performed during the fourth quarter and are performed at the reporting unit level. Our annual process for
evaluating goodwill allows us to perform a qualitative assessment for all reporting units, and then perform a quantitative goodwill
impairment test for those reporting units in which it is deemed necessary. The qualitative factors evaluated by the Company include:
economic conditions of the local business environment, overall financial performance, sensitivity analysis from the most recent
quantitative test, and other entity specific factors as deemed appropriate. If we determine a quantitative goodwill impairment test is
appropriate, the test involves comparing the fair value of a reporting unit to its carrying amount, including goodwill, after any long-
lived asset impairment charges. Generally, the fair value is determined using discounted projected future cash flows and market
multiple of earnings. If the carrying amount of the reporting unit exceeds the fair value of the reporting unit, a goodwill impairment
loss is recognized in an amount equal to the excess. Determining the fair value of reporting units requires significant management
judgment in estimating future cash flows and assessing potential market and economic conditions. It is reasonably possible that our
operations will not perform as expected, or that estimates or assumptions could change, which may result in the recording of material
non-cash impairment charges during the year in which these determinations take place.
Acquired finite-lived intangible assets are amortized over their estimated useful lives. We evaluate the recoverability of our finite-
intangible assets, as a part of our long-lived assets, for possible impairment whenever events or circumstances indicate that the
carrying amount of such assets may not be recoverable. The evaluation is performed at the lowest level for which identifiable cash
flows are largely independent of the cash flows of other assets and liabilities. The recoverability of these assets is measured by a
comparison of the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If such review indicates
that the carrying amount of intangible assets is not recoverable, the carrying amount of such assets is reduced to its fair value. In
addition to the recoverability assessment, we routinely review the remaining estimated useful lives of our finite-lived intangible assets.
If we reduce the estimated useful life assumption for any asset, the remaining unamortized balance would be amortized over the
revised estimated useful life.
As of December 31, 2023, the Consolidated Balance Sheet includes goodwill of $847.5 million and acquired intangible assets, net of
accumulated amortization, of $167.6 million. For the year ended December 31, 2023, no impairment of goodwill or acquired
intangible assets has been identified.
A Network of Enablement
69
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
See Item 8 of Part II, “Financial Statements and Supplementary Data - Note 3 - Summary of Significant Accounting Policies and
Practices.
FORWARD-LOOKING STATEMENTS
This document contains statements that constitute forward-looking statements within the meaning of section 27A of the Securities Act
of 1933 and section 21E of the Securities Exchange Act of 1934 (“Exchange Act”). Generally, the words “believe,” “expect,”
“anticipate,” “intend,” “estimate,” “will” and similar expressions identify forward-looking statements. However, the absence of these
words or similar expressions does not mean the statement is not forward-looking. All statements other than statements of historical
facts included in this document are forward-looking statements, including, but not limited to, statements regarding the following:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
our business plans and financing plans and requirements;
trends affecting our business plans and financing plans and requirements;
trends affecting our business;
the adequacy of capital to meet our capital requirements and expansion plans;
the assumptions underlying our business plans;
our ability to repay indebtedness;
our estimated capital expenditures;
the potential outcome of loss contingencies;
our expectations regarding the closing of any pending acquisitions;
business strategy;
government regulatory action;
the expected effects of changes in laws or accounting standards;
the impact of the pandemics, including its variants on our results of operations and financial position;
technological advances; and
projected costs and revenues.
Although we believe that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that
these expectations will prove to be correct.
Investors are cautioned that any forward-looking statements are not guarantees of future performance and involve risks and
uncertainties. Actual results may materially differ from those in the forward-looking statements as a result of various factors,
including, but not limited to, conditions in world financial markets and general economic conditions, including impacts from the
pandemics; inflation; the war in Ukraine and the Middle East and the related economic sanctions; our ability to successfully integrate
any acquired operations economic conditions in specific countries and regions; technological developments affecting the market for
our products and services; our ability to successfully introduce new products and services; foreign currency exchange rate
fluctuations; the effects of any breach of our computer systems or those of our customers or vendors, including our financial
processing networks or those of other third parties; interruptions in any of our systems or those of our vendors or other third parties;
our ability to renew existing contracts at profitable rates; changes in fees payable for transactions performed for cards bearing
international logos or over switching networks such as card transactions on ATMs; our ability to comply with increasingly stringent
regulatory requirements, including anti-money laundering, anti-terrorism, anti-bribery, sanctions, consumer and data protection and
privacy and the EU’s General Data Protection Regulation and Second Revised Payment Service Directive requirements; changes in
laws and regulations affecting our business, including tax and immigration laws and any laws regulating payments, including DCC
transactions, changes in our relationships with, or in fees charged by, our business partners; competition; the outcome of claims and
other loss contingencies affecting Euronet; the cost of borrowing (including fluctuations in interest rates), availability of credit and
terms of and compliance with debt covenants; and renewal of sources of funding as they expire and the availability of replacement
funding and those factors referred to above and as set forth and more fully described in Part I, Item 1A — Risk Factors. Any forward-
looking statements made in this Form 10-K speak only as of the date of this report. Except as required by law, we do not intend, and
do not undertake, any obligation to update any forward-looking statements to reflect future events or circumstances after the date of
such statements.
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Euronet | 2023 Annual Report
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest rate risk
As of December 31, 2023, our total debt outstanding, excluding unamortized debt issuance costs, was $1,874.4 million. Of this
amount, $525 million, or 28% of our total debt obligations, relates to our contingent Convertible Notes that have a fixed coupon rate.
Our $525.0 million outstanding principal amount of Convertible Notes accrues cash interest at a rate of 0.75% of the principal amount
per annum. Based on quoted market prices, as of December 31, 2023, the fair value of our fixed rate Convertible Notes was $530.3
million, compared to a carrying value of $525.0 million. Further, as of December 31, 2023, we had $536.9 million outstanding under
our Credit Facility, or 29% of our total debt obligations. If we were to maintain these borrowings for one year and maximize the
potential borrowings available under the revolving credit facility for one year, a 1% (100 basis points) increase in the applicable
interest rate would result in additional interest expense to the Company of approximately $12.5 million. The carrying value of the
Credit Facility approximates fair value because interest as of December 31, 2023, was based on Secured Overnight Financing Rate
(SOFR) that reset at various intervals of less than one year. Additionally, $662.2 million, or 35% of our total debt obligations, relates
to Senior Notes having a fixed coupon rate. Our €600 million outstanding principal amount of Senior Notes accrues cash interest at a
rate of 1.375% of the principal per annum. Based on quoted market prices, as of December 31, 2023, the fair value of our fixed rate
Senior Notes was $621.6 million, compared to a carrying value of $662.2 million. Also, $150 million, or 8% of our total debt
obligations, relates to an Uncommitted Loan Agreement, fully drawn and outstanding at December 31, 2023, for the sole purpose of
providing vault cash for ATMs, that expires no later than June 21, 2024. The loan is a Prime rate loan, Bloomberg Short-term Bank
Yield (“BSBY”) rate loan plus 0.95% or bears interest at the rate agreed to by the Bank and the Company at the time such loan is
made. The remaining $0.3 million, or less than 0% of our total debt obligations, is related to borrowings by certain subsidiaries to
fund, from time to time, working capital requirements. These arrangements generally are due within one year and accrue interest at
variable rates.
Additionally, as of December 31, 2023, we had approximately $3.9 million of finance leases with fixed payment and interest terms
that expire between the years of 2024 and 2028.
Our excess cash is invested in instruments with original maturities of three months or less or in certificates of deposit that may be
withdrawn at any time without penalty; therefore, as investments mature and are reinvested, the amount we earn will increase or
decrease with changes in the underlying short-term interest rates.
Foreign currency exchange rate risk
For the years ended December 31, 2023 and 2022, 76% and 75% of our revenues, respectively, were generated in non-U.S. dollar
countries. We expect to continue generating a significant portion of our revenues in countries with currencies other than the
U.S. dollar.
We are particularly vulnerable to fluctuations in exchange rates of the U.S. dollar to the currencies of countries in which we have
significant operations, primarily the euro, British pound, Australian dollar, Polish zloty, Indian rupee, New Zealand dollar, Malaysian
ringgit and Hungarian forint. As of December 31, 2023, we estimate that a 10% fluctuation in these foreign currency exchange rates
would have the combined annualized effect on reported net income and working capital of approximately $140 million to $150
million. This effect is estimated by applying a 10% adjustment factor to our non-U.S. dollar results from operations, intercompany
loans that generate foreign currency gains or losses and working capital balances that require translation from the respective functional
currency to the U.S. dollar reporting currency.
Additionally, we have other non-current, non-U.S. dollar assets and liabilities on our balance sheet that are translated to the U.S. dollar
during consolidation. These items primarily represent goodwill and intangible assets recorded in connection with acquisitions in
countries other than the U.S. We estimate that a 10% fluctuation in foreign currency exchange rates would have a non-cash impact on
total comprehensive (loss) income of approximately ($80) million to ($90) million as a result of the change in value of these items
during translation to the U.S. dollar. For the fluctuations described above, a strengthening U.S. dollar produces a financial loss, while
a weakening U.S. dollar produces a financial gain.
A Network of Enablement
71
We believe this quantitative measure has inherent limitations and does not take into account any governmental actions or changes in
either customer purchasing patterns or our financing or operating strategies. Because a majority of our revenues and expenses are
incurred in the functional currencies of our international operating entities, the profits we earn in foreign currencies are positively
impacted by a weakening of the U.S. dollar and negatively impacted by a strengthening of the U.S. dollar. Additionally, our debt
obligations are primarily in U.S. dollars; therefore, as foreign currency exchange rates fluctuate, the amount available for repayment of
debt will also increase or decrease.
We use derivatives to minimize our exposures related to changes in foreign currency exchange rates and to facilitate foreign currency
risk management services by writing derivatives to customers. Derivatives are used to manage the overall market risk associated with
foreign currency exchange rates; however, we do not perform the extensive record-keeping required to account for the derivative
transactions as hedges. Due to the relatively short duration of the derivative contracts, we use the derivatives primarily as economic
hedges. Since we do not designate foreign currency derivatives as hedging instruments pursuant to the accounting standards, we
record gains and losses on foreign exchange derivatives in earnings in the period of change.
A majority of our consumer-to-consumer money transfer operations involve receiving and disbursing different currencies, in which we
earn a foreign currency spread based on the difference between buying currency at wholesale exchange rates and selling the currency
to consumers at retail exchange rates. We enter into foreign currency forward and cross-currency swap contracts to minimize exposure
related to fluctuations in foreign currency exchange rates. The changes in fair value related to these contracts are recorded in Foreign
currency exchange (loss) gain, net on the Consolidated Statements of Operations. As of December 31, 2023, we had foreign currency
derivative contracts outstanding with a notional value of $393.3 million, primarily in Australian dollars, British pounds, Canadian
dollars, euros and Mexican pesos, that were not designated as hedges and mature within a few days.
For derivative instruments our xe operations write to customers, we aggregate the foreign currency exposure arising from customer
contracts and hedge the resulting net currency risks by entering into offsetting contracts with established financial institution
counterparties as part of a broader foreign currency portfolio. The changes in fair value related to the total portfolio of positions are
recorded in Revenues on the Consolidated Statements of Operations. As of December 31, 2023, we held foreign currency derivative
contracts outstanding with a notional value of $1.1 billion, primarily in U.S. dollars, euros, British pounds, Australian dollars, and
New Zealand dollars, that were not designated as hedges and for which the majority mature within the next twelve months.
We use longer-term foreign currency forward contracts to mitigate risks associated with changes in foreign currency exchange rates on
certain foreign currency denominated other asset and liability positions. As of December 31, 2023, the Company had foreign currency
forward contracts outstanding with a notional value of $563.1 million, primarily in euros.
See Note 13, Derivative Instruments and Hedging Activities to our Consolidated Financial Statements for additional information.
72
Euronet | 2023 Annual Report
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Report of Independent Registered Public Accounting Firm ......................................................................................................................................................
CONSOLIDATED FINANCIAL STATEMENTS ..........................................................................................................................................................................
CONSOLIDATED BALANCE SHEETS ..............................................................................................................................................................................................
CONSOLIDATED STATEMENTS OF OPERATIONS .............................................................................................................................................................
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME .....................................................................................................
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY .......................................................................................................................................
CONSOLIDATED STATEMENTS OF CASH FLOWS ............................................................................................................................................................
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS .............................................................................................................................................
(1) Organization ..................................................................................................................................................................................................................................................
(2) Basis of Preparation .................................................................................................................................................................................................................................
(3) Summary of Significant Accounting Policies and Practices .........................................................................................................................................
(4) Settlement Assets and Obligations .................................................................................................................................................................................................
(5) Stockholders’ Equity ...............................................................................................................................................................................................................................
(6) Acquisitions ...................................................................................................................................................................................................................................................
(7) Restricted Cash ............................................................................................................................................................................................................................................
(8) Property and Equipment, Net .............................................................................................................................................................................................................
(9) Goodwill and Acquired Intangible Assets, Net ......................................................................................................................................................................
(10) Convertible Notes Receivable ........................................................................................................................................................................................................
(11) Accrued Expenses and Other Current Liabilities ...............................................................................................................................................................
(12) Debt Obligations ......................................................................................................................................................................................................................................
(13) Derivative Instruments and Hedging Activities ..................................................................................................................................................................
(14) Leases .............................................................................................................................................................................................................................................................
(15) Income Taxes .............................................................................................................................................................................................................................................
(16) Valuation and Qualifying Accounts ...........................................................................................................................................................................................
(17) Stock Plans ..................................................................................................................................................................................................................................................
(18) Business Segment Information ......................................................................................................................................................................................................
(19) Financial Instruments and Fair Value Measurements .....................................................................................................................................................
(20) Litigation and Contingencies ..........................................................................................................................................................................................................
(21) Commitments ............................................................................................................................................................................................................................................
(22) Related Party Transactions ...............................................................................................................................................................................................................
PAGE
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A Network of Enablement
73
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and Board of Directors
Euronet Worldwide, Inc.:
Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting
We have audited the accompanying consolidated balance sheets of Euronet Worldwide, Inc. and subsidiaries (the Company) as of
December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive income (loss), changes in equity, and
cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes (collectively, the
consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of
December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of
Sponsoring Organizations of the Treadway Commission.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of
the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years in the three-
year period ended December 31, 2023, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the
Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023 based on
criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the
Treadway Commission.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over
financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the
accompanying Management’s Report On Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the
Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our
audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB)
and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to
error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the
consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such
procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial
statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well
as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting
included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and
testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included
performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable
basis for our opinions.
74
Euronet | 2023 Annual Report
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect
on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements
that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are
material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The
communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a
whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or
on the accounts or disclosures to which it relates.
Sufficiency of audit evidence over revenue
As discussed in Note 3 to the consolidated financial statements, the Company earned $3.7 billion of revenue in 2023. The
Company earned revenue by payment and transaction processing and distribution solutions to financial institutions, retailers,
service providers and individual consumers (collectively services). The services were provided to customers in approximately 200
countries through 67 worldwide offices within 3 different reportable operating segments.
We identified the evaluation of the sufficiency of audit evidence over revenue as a critical audit matter. The Company’s
geographical dispersion of services worldwide, amongst various business lines required especially subjective auditor judgment in
evaluating the sufficiency of audit evidence over revenue. Further, our audit team consisted of auditors located in various
countries worldwide. This required especially challenging auditor judgment in the level of audit procedures and supervision
applied at each country.
The following are the primary procedures we performed to address this critical audit matter. We applied auditor judgment to
determine the nature and extent of procedures to be performed over revenue, including the determination of locations at which
those procedures were to be performed. At each Company location selected, we:
• evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s revenue
process, including controls over the accurate recording of revenue amounts
• assessed the training and experience of the auditors on our audit team that were in countries other than the United States
• tested a sample of individual revenue transactions by comparing amounts recognized by the Company to relevant contracts
and or payment and transaction support.
We evaluated the sufficiency of audit evidence obtained over revenue by assessing the results of procedures performed, including
appropriateness of such evidence.
We have served as the Company’s auditor since 2003.
/s/ KPMG LLP
Kansas City, Missouri
February 22, 2024
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76
Euronet | 2023 Annual Report
CONSOLIDATED FINANCIAL STATEMENTS
EURONET WORLDWIDE, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(in millions, except share and per share data)
ASSETS
Current assets:
Cash and cash equivalents
ATM cash
Restricted cash
Settlement assets
Trade accounts receivable, net of credit loss allowance of $3.6 and $4.0
Prepaid expenses and other current assets
Total current assets
Operating right of use lease assets
Property and equipment, net of accumulated depreciation of $656.9 and $576.4
Goodwill
Acquired intangible assets, net of accumulated amortization of $214.1 and $199.2
Other assets, net of accumulated amortization of $76.3 and $68.0
Convertible notes receivable
Total assets
LIABILITIES AND EQUITY
Current liabilities:
Settlement obligations
Trade accounts payable
Accrued expenses and other current liabilities
Current portion of operating lease obligations
Short-term debt obligations and current maturities of long-term debt obligations
Income taxes payable
Deferred revenue
Total current liabilities
Debt obligations, net of current portion
Operating lease obligations, net of current portion
Deferred income taxes
Other long-term liabilities
Total liabilities
Equity:
Euronet Worldwide, Inc. stockholders’ equity:
Preferred Stock, $0.02 par value. 10,000,000 shares authorized; none issued
Common Stock, $0.02 par value. 90,000,000 shares authorized; shares issued 64,376,923 and 64,091,387
Additional paid-in capital
Treasury stock, at cost, shares issued 18,598,961 and 14,269,645
Retained earnings
Accumulated other comprehensive loss
Total Euronet Worldwide, Inc. stockholders’ equity
Noncontrolling interests
Total equity
Total liabilities and equity
See accompanying notes to the Consolidated Financial Statements.
A Network of Enablement
December 31,
2023
2022
$
1,254.2 $
525.2
15.2
1,681.5
370.6
316.0
4,162.7
142.6
332.1
847.5
167.6
181.9
1,131.2
515.6
7.4
1,442.7
270.8
359.0
3,726.7
149.7
336.6
828.3
188.3
174.0
$
$
60.0
5,894.4 $
—
5,403.6
1,681.5 $
241.2
1,442.7
222.4
439.0
50.3
150.3
81.6
505.7
50.2
0.1
67.5
56.7
2,700.6
65.4
2,354.0
1,715.4
1,609.1
95.8
47.0
85.9
4,644.7
102.7
28.4
65.0
4,159.2
—
—
1.3
1,311.6
(1,487.7 )
1.3
1,251.8
(1,105.8 )
1,627.9
1,348.3
(203.2 )
1,249.9
(0.2 )
1,249.7
5,894.4 $
(251.0 )
1,244.6
(0.2 )
1,244.4
5,403.6
$
77
EURONET WORLDWIDE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except share and per share data)
Year Ended December 31,
Revenues
Operating expenses:
Direct operating costs
Acquired contract cost impairment
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
Operating income
Other income (expense):
Interest income
Interest expense
Foreign currency exchange gain (loss), net
Other gains, net
Other expense, net
Income before income taxes
Income tax expense
Net income
2023
2022
$ 3,688.0 $ 3,358.8 $ 2,995.5
2021
2,222.8
—
2,018.2
—
602.9
296.8
132.9
3,255.4
432.6
534.2
285.1
135.9
2,973.4
385.4
1,900.2
38.6
484.9
252.0
135.8
2,811.5
184.0
15.2
(55.6 )
8.0
0.2
(32.2 )
400.4
(120.9 )
279.5
0.2
279.7 $
2.0
(37.5 )
(28.2 )
0.9
(62.8 )
322.6
(91.9 )
230.7
0.3
231.0 $
0.7
(38.3 )
(10.8 )
—
(48.4 )
135.6
(65.1 )
70.5
0.2
70.7
Less: Net loss attributable to noncontrolling interests
Net income attributable to Euronet Worldwide, Inc.
$
Earnings per share attributable to Euronet Worldwide, Inc. stockholders:
Basic
Diluted
Weighted average shares outstanding:
Basic
Diluted
$
$
5.77 $
5.50 $
4.60 $
4.41 $
1.34
1.32
48,482,006 50,175,614 52,585,674
51,599,633 53,463,308 53,529,576
See accompanying notes to the Consolidated Financial Statements.
78
Euronet | 2023 Annual Report
EURONET WORLDWIDE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME
(in millions)
Year Ended December 31,
2022
2021
2023
$
279.5 $
230.7 $
70.5
47.9
327.4
—
327.4 $
(78.3 )
152.4
(0.2 )
152.2 $
(78.5 )
(8.0 )
0.1
(7.9 )
Net income
Other comprehensive (loss) income
Translation adjustment
Comprehensive (loss) income
Comprehensive loss (income) attributable to noncontrolling interests
Comprehensive (loss) income attributable to Euronet Worldwide, Inc.
$
See accompanying notes to the Consolidated Financial Statements.
A Network of Enablement
79
EURONET WORLDWIDE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in millions, except share data)
Balance as of December 31, 2020
Net income (loss)
Other comprehensive loss
Stock issued under employee stock plans
Share-based compensation
Repurchase of shares
Balance as of December 31, 2021
Net income (loss)
Other comprehensive (loss) income
Adoption of ASU-2020-60 on Convertible bond
Stock issued under employee stock plans
Share-based compensation
Repurchase of shares
Balance as of December 31, 2022
Net income (loss)
Other comprehensive (loss) income
Stock issued under employee stock plans
Share-based compensation
Repurchase of shares
Balance as of December 31, 2023
Number
of Shares
Outstanding
(Common
and
Treasury)
Common
Stock
Additional
Paid-in
Capital
Treasury
Stock
52,734,049 $
1.3 $
1,228.4 $
(703.0 )
—
—
413,835
—
(2,000,000 )
51,147,884
—
—
—
314,358
—
(1,639,535 )
49,822,707
—
—
292,151
—
(4,336,896 )
45,777,962 $
—
—
—
—
—
1.3
—
—
—
—
—
—
—
—
9.1
36.6
—
1,274.1
—
—
(74.1 )
7.7
44.1
—
—
(0.4 )
—
(227.8 )
(931.2 )
—
—
—
0.4
—
—
(175.0 )
1.3
1,251.8
(1,105.8 )
—
—
—
—
—
—
6.1
53.7
—
—
(3.5 )
—
—
1.3 $
—
(378.4 )
1,311.6 $ (1,487.7 )
See accompanying notes to the Consolidated Financial Statements.
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Euronet | 2023 Annual Report
EURONET WORLDWIDE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)
(in millions)
Balance as of December 31, 2020
Net income (loss)
Other comprehensive loss
Stock issued under employee stock plans
Share-based compensation
Repurchase of shares
Balance as of December 31, 2021
Net income (loss)
Other comprehensive (loss) income
Adoption of ASU-2020-06 on Convertible bond
Stock issued under employee stock plans
Share-based compensation
Repurchase of shares
Balance as of December 31, 2022
Net income (loss)
Other comprehensive (loss) income
Stock issued under employee stock plans
Share-based compensation
Repurchase of shares
Balance as of December 31, 2023
Accumulated
Other
Comprehensive
Loss
Retained
Earnings
Noncontrolling
Interests
Total
$ 1,013.2 $
(94.2 ) $
70.7
—
—
—
—
1,083.9
231.0
—
33.4
—
—
—
1,348.3
279.7
(0.1 )
—
—
—
$ 1,627.9 $
—
(78.4 )
—
—
—
(172.6 )
—
(78.4 )
—
—
—
—
(251.0 )
—
47.8
—
—
—
(203.2 ) $
0.3 $ 1,446.0
70.5
(78.5 )
(0.2 )
(0.1 )
—
—
—
(0.0 )
(0.3 )
0.1
—
—
—
8.7
36.6
(227.8 )
1,255.5
230.7
(78.3 )
(40.7 )
8.1
44.1
—
(175.0 )
(0.2 ) 1,244.4
(0.2 ) 279.5
0.2
47.9
2.6
—
53.7
—
— (378.4 )
(0.2 ) $ 1,249.7
See accompanying notes to the Consolidated Financial Statements.
A Network of Enablement
81
EURONET WORLDWIDE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
Net income (loss)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
Share-based compensation
Unrealized foreign exchange (gain) loss, net
Deferred income taxes
Accretion of convertible debt discount and amortization of debt issuance costs
Changes in working capital, net of amounts acquired:
Income taxes payable, net
Trade accounts receivable, including amounts in settlement assets
Prepaid expenses and other current assets, including amounts in settlement assets
Trade accounts payable, including amounts in settlement obligations
Deferred revenue
Accrued expenses and other current liabilities, including amounts in settlement
obligations
Changes in non-current assets and liabilities
Net cash provided by operating activities
Cash flows from investing activities:
Acquisitions, net of cash acquired
Purchases of property and equipment and proceeds of sale property and equipment
Issuance of Convertible Notes Receivable
Purchases of other long-term assets
Other, net
Net cash used in investing activities
Cash flows from financing activities:
Proceeds from issuance of shares
Repurchase of shares
Borrowings from revolving credit agreements
Repayments of revolving credit agreements
Net (repayments) borrowings from short-term debt obligations
Debt issuance costs
Other, net
Net cash used in financing activities
Effect of exchange rate changes on cash and cash equivalents and restricted cash
Increase (decrease) in cash and cash equivalents and restricted cash
Cash and cash equivalents and restricted cash at beginning of period
Cash and cash equivalents and restricted cash at end of period
Supplemental Cash Flow Disclosures:
Interest paid during the period
Income taxes paid during the period
Year Ended December 31,
2023
2022
2021
$
279.5 $
230.7 $
70.5
132.9
53.7
(8.0 )
13.7
4.0
11.6
(190.9 )
42.4
53.6
(10.3 )
238.7
22.2
643.1
(1.3 )
(94.4 )
(60.0 )
(9.1 )
7.2
(157.6 )
135.9
44.1
28.2
7.9
3.7
10.8
(299.4 )
(192.6 )
178.1
(8.4 )
608.2
1.1
748.3
(343.0 )
(104.3 )
—
(7.7 )
1.2
(453.8 )
135.8
36.5
10.8
(2.3 )
20.2
23.9
(107.5 )
93.5
(33.2 )
7.5
93.0
57.6
406.3
—
(92.2 )
—
(7.8 )
1.9
(98.1 )
7.8
(378.4 )
9.1
(176.0 )
10.8
(229.9 )
7,925.8
(7,393.6 )
7,904.6
(7,733.2 )
1.2
(3.0 )
5,074.0
(5,061.0 )
0.1
—
(6.0 )
(212.0 )
(109.6 )
(13.4 )
2,099.5
$ 2,247.0 $ 1,990.8 $ 2,086.1
(302.8 )
—
(2.0)
(143.2 )
(86.1 )
256.2
1,990.8
(3.9 )
(1.2 )
(388.6 )
(95.3 )
2,086.1
$
$
53.2 $
94.5 $
29.1 $
86.2 $
18.5
48.7
See accompanying notes to the Consolidated Financial Statements.
82
Euronet | 2023 Annual Report
EURONET WORLDWIDE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) ORGANIZATION
Euronet Worldwide, Inc. (the “Company” or “Euronet”) was established as a Delaware corporation on December 13, 1996 and
succeeded Euronet Holding N.V. as the group holding company, which was founded and established in 1994. Euronet is a leading
financial technology solutions and payments provider. Euronet offers payment and transaction processing and distribution solutions to
financial institutions, retailers, service providers and individual consumers. Euronet’s primary product offerings include
comprehensive ATM, POS, card outsourcing, card issuing and merchant acquiring services, electronic distribution of prepaid mobile
airtime and other electronic payment products, and international payment services.
(2) BASIS OF PREPARATION
The Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United
States (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The
Consolidated Financial Statements include the accounts of Euronet and its wholly owned and majority owned subsidiaries and all
significant intercompany balances and transactions have been eliminated. Euronet’s investments in companies that it does not control,
but has the ability to significantly influence, are accounted for under the equity method. Euronet has no variable interest entities.
Results from operations related to entities acquired during the periods covered by the Consolidated Financial Statements are reflected
from the effective date of acquisition.
The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires that management make a number of
estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities
and the reported amounts of revenues and expenses. Significant items subject to such estimates and assumptions include computing
income taxes, contingent purchase price consideration, estimating the useful lives and potential impairment of long-lived assets and
goodwill, as well as allocating the purchase price to assets acquired and liabilities assumed in acquisitions and revenue recognition.
Actual results could differ from those estimates.
Seasonality
Euronet’s EFT Processing Segment normally experiences its heaviest demand for DCC services during the third quarter of the fiscal
year, normally coinciding with the tourism season. Additionally, the EFT Processing and epay Segments are normally impacted by
seasonality during the fourth quarter and first quarter of each year due to higher transaction levels during the holiday season and lower
levels following the holiday season. Seasonality in the Money Transfer Segment varies by region of the world. In most markets,
Euronet usually experiences increased demand for money transfer services from the month of May through the fourth quarter of each
year, coinciding with the increase in worker migration patterns and various holidays, and its lowest transaction levels during the first
quarter of the year.
(3) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES
Foreign currencies
Assets and liabilities denominated in currencies other than the functional currency of a subsidiary are remeasured at rates of exchange
on the balance sheet date. Resulting gains and losses on foreign currency transactions are included in the Consolidated Statements of
Operations. The majority of our foreign currency exchange gains or losses are due to the remeasurement of intercompany loans which
are not considered a long-term investment in nature and are in a currency other than the functional currency of one of the parties to
the loan.
The financial statements of foreign subsidiaries where the functional currency is not the U.S. dollar are translated to U.S. dollars using
(i) exchange rates in effect at period end for assets and liabilities, and (ii) weighted average exchange rates during the period for
revenues and expenses. Adjustments resulting from translation of such financial statements are reflected in accumulated other
comprehensive (loss) income as a separate component of consolidated equity.
A Network of Enablement
83
Cash equivalents
The Company considers all highly liquid investments, with an original maturity of three months or less, and certificates of deposit,
which may be withdrawn at any time at the discretion of the Company without penalty, to be cash equivalents.
ATM cash
ATM cash represents cash within the ATM network either included within ATMs, within dedicated accounts, or in-transit to ATMs.
Settlement assets and obligations
Settlement assets represent funds received or to be received from agents for unsettled money transfers and from merchants for
unsettled prepaid transactions. See Note 4, Settlement Assets and Obligations, to the Consolidated Financial Statements for further
discussion on settlement assets and obligations.
Property and equipment
Property and equipment are stated at cost, less accumulated depreciation. Property and equipment acquired in acquisitions have been
recorded at estimated fair values as of the acquisition date.
Depreciation is generally calculated using the straight-line method over the estimated useful lives of the respective assets.
Depreciation and amortization rates are generally as follows:
ATMs or ATM upgrades
Computers and software
POS terminals
Vehicles and office equipment
Leasehold improvements
Goodwill and other intangible assets
5 - 8 years
3 - 5 years
3 - 5 years
3 - 10 years
Over the lesser of the lease term or estimated useful life
Goodwill - The Company accounts for goodwill and other intangible assets in accordance with Financial Accounting Standards Board
(“FASB”) Accounting Standards Codification (“ASC”) Topic 350, Intangibles - Goodwill and Other (“ASC 350”). In accordance with
the requirements of ASC 350 the Company tests for impairment on an annual basis in the fourth quarter and whenever events or
circumstances dictate. Goodwill is allocated among and evaluated for impairment at the reporting unit level, which is defined as an
operating segment or one level below an operating segment.
ASC 350 provides an entity the option to first assess qualitative factors to determine whether the existence of events or circumstances
leads to a determination that it is more likely than not (more than 50%) that the estimated fair value of a reporting unit is less than its
carrying amount. If an entity elects to perform a qualitative assessment and determines that an impairment is more likely than not, the
entity is then required to perform the existing quantitative impairment test (described below), otherwise no further analysis is required.
An entity also may elect not to perform the qualitative assessment and, instead, proceed directly to the quantitative impairment test.
The Company has a policy for its annual review of goodwill to perform the qualitative assessment for all reporting units not subjected
directly to the quantitative impairment test.
Under the qualitative assessment, various events, and circumstances (or factors) that would affect the estimated fair value of a
reporting unit are identified (similar to impairment indicators). These factors are then classified by the type of impact they would have
on the estimated fair value using positive, neutral, and adverse categories based on current business conditions. Furthermore, the
Company considers the results of the most recent quantitative impairment test completed for a reporting unit and compares, among
other factors, the weighted average cost of capital (“WACC”) between the current and prior years for each reporting unit.
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Euronet | 2023 Annual Report
Under the quantitative impairment test, the evaluation of impairment involves comparing the current fair value of each reporting unit
to its carrying value, including goodwill. The Company uses weighted results from the income approach or the discounted cash flow
model (“DCF model”) and guideline public company method (“Market Approach model”) to estimate the current fair value of its
reporting units when testing for impairment, as management believes forecasted cash flows and EBITDA are the best indicators of
such fair value. A number of significant assumptions and estimates are involved in the application of the DCF model to forecast
operating cash flows, including sales volumes, gross margins, tax rates, capital spending, discount rates and working capital changes.
Most of these assumptions vary significantly among the reporting units. Significant assumptions in the Market Approach model are
projected EBITDA, selected market multiple, and the estimated control premium. If the carrying value of goodwill exceeds its fair
value, an impairment loss equal to such excess would be recognized. The DCF Model and Market Approach Model utilize Level 3
inputs in the fair value hierarchy as they include unobservable inputs that require significant management assumptions.
Other Intangible Assets - In accordance with ASC 350, intangible assets with finite lives are amortized over their estimated useful
lives. Unless otherwise noted, amortization is calculated using the straight-line method over the estimated useful lives of the assets
as follows:
Non-compete agreements
Trademarks and trade names
Software
Customer relationships
2 - 5 years
2 - 20 years
3 - 10 years
6 - 20 years
The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable. If such events or changes in circumstances are present, a loss is recognized if the carrying
value of the asset is in excess of the sum of the undiscounted cash flows expected to result from the use of the asset and its eventual
disposition. An impairment loss is measured as the amount by which the carrying amount of the asset exceeds the fair value of
the asset.
See Note 9, Goodwill and Acquired Intangible Assets, Net, to the Consolidated Financial Statements for additional information
regarding the impairment of goodwill and other intangible assets.
Other assets
Other assets include capitalized software development costs and capitalized payments for new or renewed contracts.
Euronet capitalizes initial payments for new or renewed contracts to the extent recoverable through future operations, contractual
minimums and/or penalties in the case of early termination. The Company’s accounting policy is to limit the amount of capitalized
costs for a given contract to the lesser of the estimated ongoing net future cash flows related to the contract or the termination fees the
Company would receive in the event of early termination of the contract by the customer.
ASC Topic 340, Other Assets and Deferred Costs (“ASC 340”) requires the deferral of incremental costs to fulfill customer contracts,
known as contract assets, which are then amortized to expense as part of direct operating costs over the respective periods of expected
benefit. Deferred contract costs are reported on our balance sheet within current or non-current other assets based on the expected life
of the related contract. At December 31, 2023 and 2022, we had $78.4 million and $78.9 million, respectively, of deferred contract
costs. For the years ended December 31, 2023, 2022 and 2021, we had $17.1 million, $22.1 million, and $33.3 million of amortization
related to these costs, respectively. On a quarterly basis we evaluate the carrying amount of contract assets recognized to determine if
there are contracts that may have a carrying amount in excess of the remaining future consideration to be received from the contract.
During the fourth quarter of 2021, we identified certain contract assets that had carrying balances greater than the estimated remaining
cash flows in the contracts and recorded a corresponding $38.6 million non-cash impairment. The impairment charge is the result of
lower-than-expected customer transaction volume related to these specific contracts, stemming primarily from COVID-19 related
disruptions. This non-cash impairment charge is included in the Money Transfer Segment.
A Network of Enablement
85
Convertible notes
In August 2020, the FASB issued ASU 2020-06, ”Accounting for Convertible Instruments and Contracts in an Entity’s Own
Equity” which simplifies the accounting for convertible instruments by eliminating certain accounting models when the conversion
features are not required to be accounted for as derivatives under Topic 815, Derivatives and Hedging, or that do not result in
substantial premiums accounted for as paid-in-capital. Under this ASU, certain debt instruments with embedded conversion features
will be accounted for as a single liability measured at its amortized cost. Additionally, this ASU eliminates the treasury stock method
to calculate diluted earnings per share for convertible instruments. We adopted this standard on January 1, 2022 using the modified
retrospective approach, which resulted in our Convertible Senior Notes due 2049 being recognized as a single liability. As a result of
the adoption of this standard we recorded a $99.7 million decrease to additional paid-in capital, a $56.8 million decrease in debt
discounts and a $42.9 million increase in retained earnings. The adoption of this standard also impacted our deferred tax liability by
decreasing our deferred tax liability by $15.0 million, decreasing retained earnings by $10.6 million, and increasing additional paid-in
capital by $25.6 million. Additionally, the elimination of the treasury stock method will increase the number of dilutive shares used in
the diluted earnings per share calculation, if dilutive, by 2.8 million shares.
Income taxes
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their
respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax
rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the
enactment date.
In accordance with ASC Topic 740, Income Taxes (“ASC 740”), the Company’s policy is to record estimated interest and penalties
related to the underpayment of income taxes as income tax expense in the Consolidated Statements of Operations. See Note 15,
Income Taxes, to the Consolidated Financial Statements for further discussion regarding these provisions.
Presentation of taxes collected and remitted to governmental authorities
The Company presents taxes collected and remitted to governmental authorities on a net basis in the accompanying Consolidated
Statements of Operations.
Fair value measurements
The Company applies the provisions of ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), regarding fair value
measurements for assets and liabilities. ASC 820 defines fair value, establishes a framework for measuring fair value and requires
certain disclosures about fair value measurements. The provisions apply whenever other accounting pronouncements require or permit
fair value measurements. See Note 19, Financial Instruments and Fair Value Measurements, to the Consolidated Financial Statements
for the required fair value disclosures.
Accounting for derivative instruments and hedging activities
The Company accounts for derivative instruments and hedging activities in accordance with ASC Topic 815, Derivatives and Hedging
(“ASC 815”), which requires that all derivative instruments be recognized as either assets or liabilities on the balance sheet at fair
value. Primarily in the Money Transfer Segment, the Company enters into foreign currency derivative contracts, mainly forward
contracts, to offset foreign currency exposure related to money transfer settlement assets and liabilities in currencies other than the
U.S. dollar, derivative contracts written to its customers arising from its cross-currency money transfer services and certain assets and
liability positions denominated in currencies other than the U.S. dollar. These contracts are considered derivative instruments under
the provisions of ASC 815; however, the Company does not designate such instruments as hedges for accounting purposes.
Accordingly, changes in the value of these contracts are recognized immediately as a component of foreign currency exchange gain
(loss), net in the Consolidated Statements of Operations.
Cash flows resulting from derivative instruments are included in operating activities in the Company’s Consolidated Statements of
Cash Flows. The Company enters into derivative instruments with highly credit-worthy financial institutions and does not use
derivative instruments for trading or speculative purposes. See Note 13, Derivative Instruments and Hedging Activities, to the
Consolidated Financial Statements for further discussion of derivative instruments.
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Euronet | 2023 Annual Report
Share-based compensation
The Company follows the provisions of ASC Topic 718, Compensation - Stock Compensation (“ASC 718”), for equity classified
awards, which requires the determination of the fair value of the share-based compensation at the grant date and subsequent
recognition of the related expense over the period in which the share-based compensation is earned (“requisite service period”).
The amount of future compensation expense related to awards of nonvested shares or nonvested share units (“restricted stock”) is
based on the market price for Euronet Common Stock at the grant date. The grant date is the date at which all key terms and
conditions of the grant have been determined and the Company becomes contingently obligated to transfer equity to the employee
who renders the requisite service, generally the date at which grants are approved by the Company’s Board of Directors or
Compensation Committee thereof. Share-based compensation expense for awards with only service conditions is generally recognized
as expense on a “straight-line” basis over the requisite service period. For awards that vest based on achieving periodic performance
conditions, expense is recognized on a “graded attribution method.” The graded attribution method results in expense recognition on a
straight-line basis over the requisite service period for each separately vesting portion of an award. The Company has elected to use
the “with and without method” when calculating the income tax benefit associated with its share-based payment arrangements. See
Note 17, Stock Plans, for further disclosure.
Revenue recognition
The Company recognizes revenue when control of the promised goods or services is transferred to our customers, in an amount that
reflects the consideration the Company expects to be entitled to receive in exchange for those goods or services. Sales and usage-
based taxes are excluded from revenues. A description of the major components of revenue by business segment is as follows:
EFT Processing — Revenues in the EFT Processing Segment are primarily derived from transaction and management fees and foreign
currency exchange margin from owned and outsourced ATM, POS and card processing networks and from the sale of EFT software
solutions for electronic payment and transaction delivery systems, and fees or margin earned from value added services, including
dynamic currency conversion and domestic and international surcharge.
Transaction-based fees include charges for cash withdrawals, debit or credit card transactions, balance inquiries, transactions not
completed because the relevant card issuer does not give authorization and prepaid mobile airtime recharges. Outsourcing services are
generally billed on the basis of a fixed monthly fee per ATM, plus a transaction-based fee. Transaction-based fees are recognized at
the time the transactions are processed and outsourcing management fees are recognized ratably over the contract period.
Certain of the Company’s non-cancelable customer contracts provide for the receipt of up-front fees from the customer and/or
decreasing or increasing fee schedules over the agreement term for substantially the same level of services to be provided by the
Company. The Company recognizes revenue under these contracts based on proportional performance of services over the term of the
contract. This generally results in “straight-line” (i.e., consistent value per period) revenue recognition of the contracts’ total cash
flows, including any up-front payment received from the customer, which is recorded as deferred revenue upon receipt.
epay — Revenue generated in the epay Segment is primarily derived from commissions or processing fees associated with distribution
and/or processing of prepaid mobile airtime and digital media products. These fees and commissions are received from mobile
operators, content vendors or distributors or from retailers. Commissions are recognized as revenue during the period in which the
Company provides the service. The portion of the commission that is paid to retailers is generally recorded as a direct operating cost.
In selling certain products, the Company is the principle obligor in the arrangements; accordingly, the gross sales value of the products
is recorded as revenue and the purchase cost as direct operating cost. Transactions are processed through a network of POS terminals
and direct connections to the electronic payment systems of retailers. Transaction processing fees are recognized at the time the
transactions are processed.
Money Transfer — Revenues for money transfer and other services represent a transaction fee in addition to a margin earned from
purchasing currency at wholesale exchange rates and selling the currency to customers at retail exchange rates. Revenues and the
associated direct operating cost are recognized at the time the transaction is processed. The Company has origination and distribution
agents in place, which each earn a fee for the respective service. These fees are reflected as direct operating costs.
A Network of Enablement
87
Revenues
Deferred Revenues — The Company records deferred revenues when cash payments are received or due in advance of its
performance. The decrease in the deferred revenue balance for the year ended December 31, 2023 was primarily driven by $32.9
million of cash payments received in the current year for which the Company has not yet satisfied the performance obligations, offset
by $41.6 million of revenues recognized that were included in the deferred revenue balance as of December 31, 2022.
Disaggregation of Revenues — The following table presents the Company’s revenues disaggregated by segment and region. The
Company believes disaggregation by segment and region best depicts how the nature, amount, timing, and uncertainty of revenue and
cash flows are affected by economic factors. The disaggregation of revenues by segment and region is based on management’s
assessment of segment performance together with allocation of financial resources, both capital and operating support costs, on a
segment and regional level. Both segments and regions benefit from synergies achieved through concentration of operations and are
influenced by macro-economic, regulatory and political factors in the respective segment and region. The Company recognizes foreign
exchange revenues from derivative instruments in its xe operations in accordance with ASC Topic 815 and not ASC Topic 606. These
revenues are not significant to the Company’s consolidated revenues and are included in the following tables.
(in millions)
Europe
North America
Asia Pacific
Other
Eliminations
Total
(in millions)
Europe
North America
Asia Pacific
Other
Eliminations
Total
(in millions)
Europe
North America
Asia Pacific
Other
Eliminations
Total
For the Year Ended December 31, 2023
EFT
Processing
epay
Money
Transfer
Total
$
817.2 $
717.1 $
647.7 $
2,182.0
72.8
160.2
8.1
—
172.6
137.5
55.2
—
728.9
112.8
65.8
—
974.3
410.5
129.1
(7.9 )
$
1,058.3 $
1,082.4 $
1,555.2 $
3,688.0
For the Year Ended December 31, 2022
EFT
Processing
epay
Money
Transfer
Total
$
716.3 $
658.3 $
581.9 $
1,956.5
69.3
133.9
4.7
—
133.3
155.0
51.3
—
700.1
107.5
55.0
—
902.7
396.4
111.0
(7.8 )
$
924.2 $
997.9 $
1,444.5 $
3,358.8
For the Year Ended December 31, 2021
EFT
Processing
epay
Money
Transfer
Total
$
420.2 $
669.3 $
576.6 $
1,666.1
63.4
107.0
0.6
—
139.8
158.1
44.3
—
667.7
105.1
51.5
—
870.9
370.2
96.4
(8.1 )
$
591.2 $
1,011.5 $
1,400.9 $
2,995.5
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Euronet | 2023 Annual Report
Recent accounting guidance
In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements
to Reportable Segment Disclosures. The amended guidance requires incremental reportable segment disclosures, primarily about
significant segment expenses. The amendments also require entities with a single reportable segment to provide all disclosures
required by these amendments, and all existing segment disclosures. The amendments will be applied retrospectively to all prior
periods presented in the financial statements and is effective for fiscal years beginning after December 15, 2023, and interim periods
in fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of
adopting ASU 2023-07.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The
amended guidance enhances income tax disclosures primarily related to the effective tax rate reconciliation and income taxes paid
information. This guidance requires disclosure of specific categories in the effective tax rate reconciliation and further information on
reconciling items meeting a quantitative threshold. In addition, the amended guidance requires disaggregating income taxes paid (net
of refunds received) by federal, state, and foreign taxes. It also requires disaggregating individual jurisdictions in which income taxes
paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received). ASU 2023-09
is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating
the impact of adopting ASU 2023-09.
(4) SETTLEMENT ASSETS AND OBLIGATIONS
Settlement assets represent funds received or to be received from agents for unsettled money transfers and from merchants for
unsettled prepaid transactions. The Company records corresponding settlement obligations relating to accounts payable. Settlement
assets consist of cash and cash equivalents, restricted cash, accounts receivable and prepaid expenses and other current assets. The
settlement cash held at the Company is primarily generated from the monies remitted by consumers through Company agents and
financial institutions in payment of the face value of the payment service or foreign currency purchased and the related fees charged to
purchase the currency. The Company uses its cash and cash equivalents to pay the face value of the payment service product upon
presentation by the recipient. Cash received by Company agents and merchants generally becomes available to the Company within
two weeks after initial receipt by the business partner. Receivables from business partners represent funds collected by such business
partners that are in transit to the Company.
Settlement obligations consist of accrued expenses for money transfers, content providers, and EFT customer deposits and accounts
payable to agents and content providers. Money transfer accrued expenses represent amounts to be paid to beneficiaries when they
request funds. Most agents typically settle with beneficiaries first then obtain reimbursement from the Company. Money order accrued
expenses represent amounts not yet presented for payment. Due to the agent funding and settlement process, accrued expenses to
agents represent amounts due to agents for money transfers that have not been settled with beneficiaries.
A Network of Enablement
89
(in millions)
Settlement assets:
Settlement cash and cash equivalents
Settlement restricted cash
Account receivables, net of credit loss allowance of $35.7 and $33.0
Prepaid expenses and other current assets
Total settlement assets
Settlement obligations:
Trade account payables
Accrued expenses and other current liabilities
Total settlement obligations
As of
December 31,
2023
As of
December 31,
2022
$
327.4 $
125.0
1,002.1
227.0
242.6
94.0
887.6
218.5
$
1,681.5 $
1,442.7
$
708.6 $
972.9
655.1
787.6
$
1,681.5 $
1,442.7
The table below reconciles cash and cash equivalents, restricted cash, ATM cash, settlement cash and cash equivalents, and settlement
restricted cash as presented within “Cash and cash equivalents and restricted cash” in the Consolidated Statement of Cash Flows.
(in millions)
Cash and cash equivalents
Restricted cash
ATM cash
Settlement cash and cash equivalents
Settlement restricted cash
As of
December 31,
2023
December 31,
2022
December 31,
2021
$
1,254.2 $
1,131.2 $
1,260.5
15.2
525.2
327.4
125.0
7.4
515.6
242.6
94.0
3.7
543.4
203.6
74.9
Cash and cash equivalents and restricted cash at end of period
$
2,247.0 $
1,990.8 $
2,086.1
(5) STOCKHOLDERS’ EQUITY
Earnings Per Share
Basic earnings per share has been computed by dividing earnings available to common stockholders by the weighted average number
of common shares outstanding during the respective period. Diluted earnings per share has been computed by dividing diluted
earnings by the weighted average shares outstanding during the respective period, after adjusting for the potential dilution of options
to purchase the Company’s Common Stock, assumed vesting of restricted stock and the assumed conversion of the Company’s
convertible debt.
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Euronet | 2023 Annual Report
The following table provides the computation of diluted weighted average number of common shares outstanding:
Year Ended December 31,
2023
2022
2021
Computation of diluted earnings:
Net income attributable to Euronet Worldwide, Inc. stockholders
$
279.7 $
231.0 $
Add: Interest expense from assumed conversion of convertible notes, net of tax
4.2
4.7
Net income for diluted earnings per share calculation
$
283.9 $
235.7 $
70.7
—
70.7
Computation of diluted weighted average shares outstanding:
Basic weighted average shares outstanding
48,482,006
50,175,614
52,585,674
Incremental shares from assumed exercise of stock options and vesting
of restricted stock
335,809
505,876
943,902
Incremental shares from assumed conversion of convertible debt
2,781,818
2,781,818
—
Diluted weighted average shares outstanding
51,599,633
53,463,308
53,529,576
The table includes all stock options and restricted stock that are dilutive to the Company’s weighted average common shares
outstanding during the period. The calculation of diluted earnings per share excludes stock options or shares of restricted stock that are
anti-dilutive to the Company’s weighted average common shares outstanding for the years ended December 31, 2023, 2022 and 2021
of approximately 3,768,000, 1,975,000 and 1,668,000, respectively.
We issued Convertible Senior Notes (“Convertible Notes”) due March 2049 on March 18, 2019. Our Convertible Notes currently have
a settlement feature requiring us upon conversion to settle the principal amount of the debt and any conversion value in excess of the
principal value (“conversion premium”), for cash or shares of our common stock or a combination thereof, at our option. We have
stated our intent to settle any conversion of these notes by paying cash for the principal value and issuing common stock for any
conversion premium; however, after adopting ASU 2020-06, 2.8 million incremental shares assumed for conversion of convertible
notes shall be included in the dilutive earnings per share calculation, if dilutive, regardless of whether the market price trigger has
been met. Therefore, our Convertible Notes were included in the calculation of diluted earnings (loss) per share if their inclusion was
dilutive. The dilutive effect increases the more the market price exceeds the conversion price of $188.73 per share. See Note 9, Debt
Obligations, to the Consolidated Financial Statements for more information about the Convertible Notes.
Share repurchases
On December 8, 2021, the Company put a repurchase program in place to repurchase up to $300.0 million in value, but not more than
5.0 million shares of common stock through December 8, 2023. For the year ended December 31, 2023, the Company repurchased
1,400,229 shares under the repurchase program at a weighted average purchase price of $89.31 for a total value of $125.0 million.
Repurchases under the program may take place in the open market or in privately negotiated transactions, including derivative
transactions, and may be made under a Rule 10b5-1 plan.
On September 13, 2022, the Company put a repurchase program in place to repurchase up to $350.0 million in value, but not more
than 7.0 million shares of common stock through September 13, 2024. For the year ended December 31, 2023, the Company
repurchased 2,936,667 shares under the repurchase program at a weighted average purchase price of $86.27 for a total value
of $253.4 million. Repurchases under the program may take place in the open market or in privately negotiated transactions, including
derivative transactions, and may be made under a Rule 10b5-1 plan.
On September 13, 2023, the Company put a repurchase program in place to repurchase up to $350.0 million in value, but not more
than 7.0 million shares of common stock through September 13, 2025. For the year ended December 31, 2023 we have not made any
repurchases under this plan. Repurchases under the program may take place in the open market or in privately negotiated transactions,
including derivative transactions, and may be made under a Rule 10b5-1 plan.
The Inflation Reduction Act (IRA) was signed into law in August 2022. Among other things, it imposes a 1% excise tax on net share
repurchases.
A Network of Enablement
91
Preferred Stock
The Company has the authority to issue up to 10 million shares of preferred stock, of which no shares are currently issued
or outstanding.
Accumulated other comprehensive gain (loss)
As of December 31, 2023 and 2022, accumulated other comprehensive gain (loss) consists entirely of foreign currency translation
adjustments. The Company recorded a foreign currency translation gain of $47.9 million, a loss of $78.3 million and a loss of $78.5
million for the years ended December 31, 2023, 2022, and 2021, respectively. There were no reclassifications of foreign currency
translation into the Consolidated Statements of Operations for the years ended December 31, 2023, 2022, and 2021.
Dividends
No dividends were paid on any class of the Company’s stock during 2023, 2022, and 2021.
(6) ACQUISITIONS
Acquisitions 2023
Other
The Company completed one acquisition in 2023 for an immaterial amount.
Acquisitions 2022
In accordance with ASC 805, the Company allocates the purchase price of its acquisitions to the tangible assets, liabilities and
intangible assets acquired based on fair values. Any excess purchase price over those fair values is recorded as goodwill. The fair
value assigned to intangible assets acquired is supported by valuations using estimates and assumptions provided by management. For
certain large acquisitions, management engages an appraiser to assist in the valuation process.
On March 15, 2022 we completed the acquisition of the Merchant Acquiring Business of Piraeus Bank (“PBMA”). The acquisition
includes 205,000 POS terminals at 170,000 merchants throughout Greece, as well as Piraeus Bank’s online merchant acquiring
business and expands our omnichannel payments strategy where we use our proprietary technology to provide cash, card-based
acquiring solutions, alternative payment acquiring, online acquiring, tokenized payment services and other payment products.
Additionally, the acquisition includes a long-term commercial framework agreement between Piraeus Bank and Euronet which
includes collaborative product distribution, processing and customer referrals.
The purchase price was €317.8 million, or approximately $350.6 million, which includes $331.0 million cash paid at closing, $4.4
million cash paid for surplus working capital and $15.2 million of estimated contingent consideration for a ten-year earn out
contingent on performance targets outlined in the commercial framework agreement. The contingent consideration is related to a
percentage of the net fee income received during the ten-year period of the commercial framework agreement and there is no
contractual maximum amount of consideration under this agreement.
The acquisition has been accounted for as a business combination in accordance with U.S. GAAP and the results of operations have
been included from the date of acquisition in the EFT Processing Segment.
The following table presents the final fair value that was allocated to PBMA’s Euronet Merchant Services’ (EMS) assets and liabilities
based upon fair values as determined by the Company. The valuation process to determine the fair values is complete. For the year
ended December 31, 2022, the Company made measurement period adjustments to reflect facts and circumstances in existence as of
the effective time of the acquisition. These adjustments primarily included an adjustment to the accrued expenses and other current
liabilities related to the surplus working capital of $4.4 million and some other immaterial adjustments.
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Euronet | 2023 Annual Report
(in millions)
Other current assets
Settlement assets
Property and equipment
Intangible assets
Total assets acquired
Trade accounts payable
Settlement liabilities
Accrued expenses and other current liabilities
Deferred revenue
Other long-term liabilities
Total liabilities assumed
Goodwill
Net assets acquired
As of March
15, 2022
$
$
$
1.8
77.6
5.7
122.5
207.6
(2.1 )
(65.9 )
(1.3 )
(0.3 )
(0.1 )
$
(69.7 )
212.7
$
350.6
The fair value measurements of intangible assets were based on significant inputs not observable in the market and represent Level 3
measurements within the fair value hierarchy. Level 3 inputs include discount rates that would be used by a market participant in
valuing these assets, projections of revenues and cash flows, and customer attrition rates, among others.
We acquired a customer relationship intangible asset with a fair value of $112.2 million that is being amortized on a straight-line basis
over 15 years and a contract related intangible asset of $10.3 million that is being amortized on a straight-line basis over 10 years.
Goodwill, with a value of $212.7 million, arising from the acquisition was included in the EFT Processing Segment. The factors that
make up goodwill include synergies from combining PBMA operations and intangible assets that do not qualify for separate
recognition. Goodwill and intangible assets associated with this acquisition are deductible for tax purposes.
The results of PBMA operations are included in our consolidated results of operation, as part of our EFT Processing business segment,
beginning on March 16, 2022. For the period beginning on the acquisition date through December 31, 2022, PBMA had $88.8 million
in revenue. For 2023, PBMA had $130.2 million in revenue. The PBMA business is impacted by higher transaction volumes during
the tourism season in the second and third quarters.
Other
The Company completed one additional acquisition in 2022 for immaterial amounts.
A Network of Enablement
93
(7) RESTRICTED CASH
The restricted cash balances as of December 31, 2023 and 2022 were as follows:
(in millions)
Collateral on bank credit arrangements and other
Restricted cash
Cash held in trust and/or cash held on behalf of others
Collateral on bank credit arrangements and other
Restricted cash included within settlement assets
Total Restricted Cash
As of December 31,
2023
2022
$
$
15.2 $
15.2 $
$
84.8 $
40.2
$
125.0 $
7.4
7.4
80.6
13.4
94.0
$
140.2 $
101.4
Cash held in trust and/or cash held on behalf of others is in connection with the administration of the customer collection and vendor
remittance activities by certain subsidiaries within the Company’s epay and EFT Processing Segments. Amounts collected on behalf
of certain mobile phone operators and/or merchants are deposited into a restricted cash account. The bank credit arrangements
primarily represent cash collateral on deposit with commercial banks to cover guarantees.
(8) PROPERTY AND EQUIPMENT, NET
The components of property and equipment, net of accumulated depreciation and amortization as of December 31, 2023 and 2022 are
as follows:
(in millions)
ATMs
POS terminals
Vehicles and office equipment
Computers and software
Land and buildings
Less accumulated depreciation
Total
$
As of December 31,
2023
2022
635.8 $
43.7
73.8
235.1
0.6
989.0
578.1
41.5
76.3
216.5
0.6
913.0
(656.9 )
(576.4 )
$
332.1 $
336.6
Depreciation expenses related to property and equipment, including property and equipment recorded under finance leases, for the
years ended December 31, 2023, 2022 and 2021 was $100.8 million, $101.5 million, and $104.7 million, respectively.
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Euronet | 2023 Annual Report
(9) GOODWILL AND ACQUIRED INTANGIBLE ASSETS, NET
The following table summarizes intangible assets as of December 31, 2023 and 2022:
(in millions)
Customer relationships
Trademarks and trade names
Software
Non-compete agreements
Total
As of December 31, 2023
As of December 31, 2022
Gross
Carrying
Amount
Accumulated
Amortization
Gross
Carrying
Amount
Accumulated
Amortization
$
270.5 $
(121.4 ) $
279.1 $
(117.0 )
56.4
44.6
10.2
(54.6 )
(36.3 )
(1.8 )
43.9
54.6
9.9
(33.7 )
(48.4 )
(0.1 )
$
381.7 $
(214.1 ) $
387.5 $
(199.2 )
The following table summarizes the goodwill and amortizable intangible assets activity for the years ended December 31, 2023
and 2022:
(in millions)
Balance as of January 1, 2022
Increases (decreases):
Acquisitions (see footnote 6)
Amortization
Other (primarily changes in foreign currency exchange rates)
Balance as of December 31, 2022
Increases (decreases):
Acquisitions (see footnote 6)
Amortization
Other (primarily changes in foreign currency exchange rates)
Balance as of December 31, 2023
$
Acquired
Intangible
Assets
Goodwill
Total
Intangible
Assets
$
97.8 $
641.6 $
739.4
124.8
(27.0 )
(7.3 )
188.3
—
(24.5 )
3.8
167.6 $
224.3
—
(37.6 )
828.3
349.1
(27.0 )
(44.9 )
1,016.6
1.3
—
1.3
(24.5 )
17.9
847.5 $
21.7
1,015.1
Of the total goodwill balance of $847.5 million as of December 31, 2023, $389.9 million relates to the Money Transfer Segment,
$125.9 million relates to the epay Segment and the remaining $331.7 million relates to the EFT Processing Segment. Amortization
expense for intangible assets with finite lives was $24.5 million, $27.0 million, and $23.1 million for the years ended December 31,
2023, 2022 and 2021, respectively. Estimated annual amortization expense on intangible assets with finite lives as of December 31,
2023, is expected to be $18.2 million for 2024, $14.6 million for 2025, $14.3 million for 2026, $13.0 million for 2027, and$12.6
million for 2028.
A Network of Enablement
95
(10) CONVERTIBLE NOTES RECEIVABLE
The Company loaned a total of $60.0 million to Koin Mobile, LLC and Marker Trax, LLC under two promissory notes (the “Notes”),
which were fully executed on October 19, 2023. Under the terms of the Notes, interest will accrue on the Notes at 2% per annum and
all unpaid principal and interest will be due and payable on October 18, 2028 if not converted earlier as discussed below. The
Company has a security interest in all of the assets of Koin Mobile, LLC and Marker Trax, LLC. The outstanding principal and
accrued interest were $60.0 million and $0.2 million at December 31, 2023, respectively.
The Notes are convertible into preferred equity of Koin Mobile, LLC and Marker Trax, LLC at the option of the Company upon the
occurrence of certain events including a qualified equity financing, change in control, achievement of profitability or at the option of
the Company at maturity, as defined in the Notes.
(11) ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
The balances as of December 31, 2023 and 2022 were as follows:
(in millions)
Accrued expenses
Other tax payables
Derivative liabilities
Accrued payroll expenses
Current portion of finance lease obligations
Total
(12) DEBT OBLIGATIONS
Debt obligations consist of the following as of December 31, 2023 and 2022:
(in millions)
Credit Facility:
Revolving credit agreement
Convertible Debt:
0.75% convertible notes, unsecured, due 2049
1.375% Senior Notes, due 2026
Uncommitted credit agreement
Other obligations
Total debt obligations
Unamortized debt issuance costs
Carrying value of debt
Short-term debt obligations and current maturities of long-term debt obligations
Long-term debt obligations
As of December 31,
2023
2022
$
254.8 $
311.8
69.1
39.1
74.4
1.6
80.6
42.3
68.0
3.0
$
439.0 $
505.7
As of December 31,
2023
2022
$
536.9 $ 454.8
525.0
525.0
662.2
642.1
150.0
—
0.3
0.2
$ 1,874.4 $ 1,622.1
(8.7 )
(12.9 )
$ 1,865.7 $ 1,609.2
(150.3 )
(0.1 )
$ 1,715.4 $ 1,609.1
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Euronet | 2023 Annual Report
As of December 31, 2023, aggregate annual maturities of long-term debt are $0 million due in 2024, $525.0 million due in 2025,
$662.2 million due in 2026, and $536.9 million thereafter. This maturity schedule reflects the revolving credit facility maturing in
2027 and the Convertible Notes maturing in 2025, coinciding with the terms of the initial put option by holders of the Convertible
Notes. It also reflects the maturing of the 1.375% Senior Notes of €600 million ($662.2 million) due in 2026.
Credit Facility
On October 24, 2022, the Company amended its revolving credit agreement (the “Credit Facility”) to increase the facility from
$1.03 billion to $1.25 billion and to extend the expiration to October 24, 2027.
The revolving credit facility contains a sublimit of up to $250 million, with $150 million committed, for the issuance of letters of
credit, a $75 million sublimit for U.S. dollar swingline loans and a $75 million sublimit for swingline loans in euros or British pounds
sterling. The Credit Facility allows for borrowings in British pounds sterling, euro and U.S. dollars. Subject to certain conditions, the
Company has the option to increase the Credit Facility by up to an additional $500 million by requesting additional commitments from
existing or new lenders. Fees and interest on borrowings vary based upon the Company’s corporate credit rating and will be based, in
the case of letter of credit fees, on a margin, and in the case of interest, on a margin over a secured overnight financing rate, as defined
in the agreement, with a margin, including the facility fee, ranging from 1.00% to 1.625% or the base rate, as selected by the
Company. The applicable margin for borrowings under the credit facility, based on the Company’s current credit rating, is initially
1.25% including the facility fee.
The agreement contains customary affirmative and negative covenants, events of default and financial covenants, including (all as
defined in the Credit Facility): (i) a Consolidated Total Leverage Ratio, depending on certain circumstances defined in the Credit
Facility, not to exceed a range between 3.5 to 1.0 and 4.5 to 1.0; and (ii) a Consolidated Interest Coverage Ratio of not less than 3.0 to
1.0. Subject to meeting certain customary covenants (as defined in the Credit Facility), the Company is permitted to repurchase
common stock and debt. The Company was in compliance with all debt covenants as of December 31, 2023.
The interest rate of the Company’s borrowings under the Credit Facility was 6.5% as of December 31, 2023.
As of December 31, 2023 and 2022, the Company had stand-by letters of credit/bank guarantees outstanding under the Credit Facility
of $51.9 million and $54.6 million, respectively. Stand-by letters of credit/bank guarantees reduce the Company’s borrowing capacity
under the Credit Facility and are generally used to secure trade credit and performance obligations. As of December 31, 2023 and
2022, the stand-by letters of credit interest charges were each 1.25% per annum. Borrowing capacity under the Credit Facility as of
December 31, 2023 was $661.2 million.
Uncommitted Credit Agreements
On June 27, 2023, the Company entered into an Uncommitted Credit Agreement for $300 million, for the sole purpose of providing
vault cash for ATMs, that expired on November 30, 2023. The loan was fully repaid and there was no balance at December 31,
2023. The loan bore interest at the rate per annum equal to the secured overnight financing rate (“SOFR”) plus 1.125%. The weighted-
average interest rate from the loan inception date to November 30, 2023 was 6.37%.
On June 26, 2023, the Company entered into an Uncommitted Loan Agreement for $150 million, fully drawn and outstanding at
December 31, 2023, for the sole purpose of providing vault cash for ATMs, that expires no later than June 21, 2024. The loan is either
a Prime rate loan, a Bloomberg Short-term Bank Yield (“BSBY”) rate loan plus 0.95% or bears interest at the rate agreed to by the
Bank and the Company at the time such loan is made. The weighted-average interest rate from the loan inception date to December
31, 2023 was 6.29%.
On May 25, 2022, the Company entered into an Uncommitted Credit Agreement for $300.0 million, for the sole purpose of providing
vault cash for ATMs, that expired on November 30, 2022. The loan was fully repaid and there was no balance at December 31,
2022. The loan bore interest at the rate per annum equal to the secured overnight financing rate (“SOFR”) plus 1.00%. The weighted-
average interest rate from the loan inception date to November 30, 2022 was 3.14%.
On June 24, 2022, the Company entered into an Uncommitted Loan Agreement for $150.0 million, for the sole purpose of providing
vault cash for ATMs, that expires no later than June 23, 2023. The loan was fully repaid and there was no balance at December 31,
2022. The loan was either a Prime rate loan, a Bloomberg Short-term Bank Yield rate loan or bore interest at the rate agreed to by the
bank and the Company at the time such loan is made. The weighted average interest rate from the loan inception date to the day of
repayment (September 28, 2022) was 2.76%.
A Network of Enablement
97
Convertible Debt
On March 18, 2019, the Company completed the sale of $525.0 million of Convertible Senior Notes (“Convertible Notes”). The
Convertible Notes mature in March 2049 unless redeemed or converted prior to such date and are convertible into shares of Euronet
Common Stock at a conversion price of approximately $188.73 per share if certain conditions are met (relating to the closing price of
Euronet Common Stock exceeding certain thresholds for specified periods). Holders of the Convertible Notes have the option to
require the Company to purchase their notes on each of March 15, 2025, March 15, 2029, March 15, 2034, March 15, 2039, and
March 15, 2044 at a repurchase price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued
and unpaid interest to, but excluding, the relevant repurchase date. In connection with the issuance of the Convertible Notes, the
Company recorded $12.8 million in debt issuance costs, which are being amortized through March 1, 2025.
The Company may redeem for cash all or any portion of the Convertible Notes, at its option, (i) if the closing sale price of the
Company’s Common Stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not
consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the
trading day immediately preceding the date on which the Company provides notice of redemption and (ii) on or after March 20, 2025
and prior to the maturity date, regardless of the foregoing sale price condition, in each case at a redemption price equal to 100% of the
principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No
sinking fund is provided for the Convertible Notes. In addition, if a fundamental change, as defined in the Indenture, occurs prior to
the maturity date, holders may require the Company to repurchase for cash all or part of their Convertible Notes at a repurchase price
equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest to, but excluding,
the fundamental change repurchase date. As of December 31, 2023 the conversion threshold was not met. On January 1, 2022, the
Company adopted ASU 2020-06, ”Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” which
simplifies the accounting for convertible instruments by eliminating certain accounting models when the conversion features are not
required to be accounted for as derivatives under Topic 815, Derivatives and Hedging, or that do not result in substantial premiums
accounted for as paid-in-capital. ASU 2020-06 amended the accounting for convertible instruments with ASC Topic 470 Debt (See
Footnote 3 for the accounting impact of adopting ASU 220-06).
Contractual interest expenses for the Convertible Notes was $3.9 million for each of the years ended December 31, 2023, 2022 and
2021. The effective interest rate was 4.4% for the year ended December 31, 2023.
1.375% Senior Notes due 2026
On May 22, 2019, the Company completed the sale of €600.0 million ($669.9 million) aggregate principal amount of Senior Notes
that mature on May 2026 (the “Senior Notes”). The Senior Notes accrue interest at a rate of 1.375% per year, payable annually in
arrears commencing May 22, 2020, until maturity or earlier redemption. As of December 31, 2023, the Company has outstanding
€600 million ($662.2 million) principal amount of the Senior Notes. In addition, the Company may redeem some or all of these notes
on or after February 22, 2026 at their principal amount plus any accrued and unpaid interest. As of December 31, 2023, the Company
had $2.9 million of unamortized debt issuance costs related to the Senior Notes.
Other obligations
Certain of the Company’s subsidiaries have available lines of credit and overdraft credit facilities that generally provide for short-term
borrowings that are used from time to time for working capital purposes. As of December 31, 2023 and 2022, borrowings under these
arrangements were $0.3 million and $0.2 million, respectively.
(13) DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
The Company is exposed to foreign currency exchange risk resulting from (i) the collection of funds or the settlement of money
transfer transactions in currencies other than the U.S. dollar, (ii) derivative contracts written to its customers in connection with
providing cross-currency money transfer services and (iii) certain foreign currency denominated other asset and liability positions. The
Company enters into foreign currency derivative contracts, primarily foreign currency forwards and cross-currency swaps, to
minimize its exposure related to fluctuations in foreign currency exchange rates. As a matter of Company policy, the derivative
instruments used in these activities are economic hedges and are not designated as hedges under ASC 815, primarily due to either the
relatively short duration of the contract term or the effects of fluctuations in currency exchange rates being reflected concurrently in
earnings for both the derivative instrument and the transaction and have an offsetting effect.
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Euronet | 2023 Annual Report
Foreign currency exchange contracts - Ria Operations and Corporate
In the United States, the Company uses short-duration foreign currency forward contracts, generally with maturities up to 14 days, to
offset the fluctuation in foreign currency exchange rates on the collection of money transfer funds between initiation of a transaction
and its settlement. Due to the short duration of these contracts and the Company’s credit profile, the Company is generally not
required to post collateral with respect to these foreign currency forward contracts. Most derivative contracts executed with
counterparties in the U.S. are governed by an International Swaps and Derivatives Association agreement that includes standard
netting arrangements; therefore, asset and liability positions from forward contracts and all other foreign exchange transactions with
the same counterparty are net settled upon maturity. As of December 31, 2023 and 2022, the Company had foreign currency forward
contracts outstanding in the U.S. with a notional value of $393.3 million and $398.6 million, respectively. The foreign currency
forward contracts consist primarily in Australian dollars, Canadian dollars, British pounds, euros and Mexican pesos.
In addition, the Company uses forward contracts, typically with maturities from a few days to less than one year, to offset foreign
exchange rate fluctuations on certain short-term borrowings that are payable in currencies other than the U.S dollar. As of December
31, 2023 and 2022, the Company had foreign currency forward contracts outstanding with a notional value of $563.1 million and
$228.4 million, respectively, primarily in euros.
Foreign currency exchange contracts - xe Operations
xe, writes derivative instruments, primarily foreign currency forward contracts and cross-currency swaps, mostly with counterparties
comprised of individuals and small-to-medium size businesses and derives a currency margin from this activity as part of its
operations. xe aggregates its foreign currency exposures arising from customer contracts and hedges the resulting net currency risks by
entering into offsetting contracts with established financial institution counterparties. Foreign exchange revenues from xe’s total
portfolio of positions were $85.3 million, $86.6 million, and $79.5 million for the years ended December 31, 2023, 2022 and 2021,
respectively. All of the derivative contracts used in the Company’s xe operations are economic hedges and are not designated as
hedges under ASC 815. The duration of these derivative contracts is generally less than one year.
The fair value of xe’s total portfolio of positions can change significantly from period to period based on, among other factors, market
movements and changes in customer contract positions. xe manages counterparty credit risk (the risk that counterparties will default
and not make payments according to the terms of the agreements) on an individual counterparty basis. It mitigates this risk by entering
into contracts with collateral posting requirements and/or by performing financial assessments prior to contract execution, conducting
periodic evaluations of counterparty performance and maintaining a diverse portfolio of qualified counterparties. xe does not expect
any significant losses from counterparty defaults.
The aggregate equivalent U.S. dollar notional amounts of foreign currency derivative customer contracts held by the Company in its
xe operations as of December 31, 2023 and 2022, was respectively $1.1 billion and $1.0 billion. The significant majority of customer
contracts are written in major currencies such as the euro, U.S. dollar, British pound, Australian dollar and New Zealand dollar.
The following table summarizes the fair value of the derivative instruments as recorded in the Consolidated Balance Sheets as of the
dates below:
(in millions)
Derivatives not designated as hedging
instruments
Foreign currency exchange contracts
Asset Derivatives
Liability Derivatives
Fair Value
Fair Value
Balance
Sheet
Location
December
31, 2023
December
31, 2022
Balance
Sheet
Location
December
31, 2023
December
31, 2022
Other
current
assets
$
50.0 $
50.3
Other
current
liabilities $
(39.1 ) $
(42.3 )
A Network of Enablement
99
Balance Sheet Presentation
The following tables summarize the gross and net fair value of derivative assets and liabilities as of December 31, 2023 and 2022
(in millions):
Offsetting of Derivative Assets
As of December 31, 2023
Derivatives subject to a master netting
arrangement or similar agreement
As of December 31, 2022
Derivatives subject to a master netting
arrangement or similar agreement
Offsetting of Derivative Liabilities
As of December 31, 2023
Derivatives subject to a master netting
arrangement or similar agreement
As of December 31, 2022
Derivatives subject to a master netting
arrangement or similar agreement
Income Statement Presentation
Gross
Amounts of
Recognized
Assets
Gross
Amounts
Offset in the
Consolidated
Balance Sheet
Net Amounts
Presented in
the
Consolidated
Balance Sheet
Derivatives
Not Offset in
the
Consolidated
Balance Sheet
Net
Amounts
$
50.0 $
— $
50.0 $
(19.9 ) $
30.1
$
50.3 $
— $
50.3 $
(32.0 ) $
18.3
Gross
Amounts of
Recognized
Liabilities
Gross
Amounts
Offset in the
Consolidated
Balance Sheet
Net Amounts
Presented in
the
Consolidated
Balance Sheet
Derivatives
Not Offset in
the
Consolidated
Balance Sheet
Net
Amounts
$
(39.1 ) $
— $
(39.1 ) $
26.3 $
(12.8 )
$
(42.3 ) $
— $
(42.3 ) $
32.1 $
(10.2 )
The following tables summarize the location and amount of gains on derivatives in the Consolidated Statements of Operations for
the years ended December 31, 2023, 2022 and 2021:
(in millions)
Location of Gain (Loss)
Recognized in Income on
Derivative Contracts
Amount of Gain (Loss) Recognized in Income
on Derivative Contracts (a)
Year Ended December 31,
2023
2022
2021
Foreign currency exchange contracts - Ria
Operations
Foreign currency exchange gain
(loss), net
$
(1.7 ) $
(0.3 ) $
1.6
(a) The Company enters into derivative contracts such as foreign currency exchange forwards and cross-currency swaps as part of its
xe operations. These derivative contracts are excluded from this table as they are part of the broader disclosure of foreign currency
exchange revenues for this business discussed above.
See Note 19, Financial Instruments and Fair Value Measurements, for the determination of the fair values of derivatives.
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Euronet | 2023 Annual Report
(14) LEASES
The Company enters into operating leases for ATM sites, office spaces, retail stores and equipment. The Company’s finance leases are
immaterial. Right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of the
lease payments over the lease terms.
The present value of lease payments is determined using the incremental borrowing rate based on information available at the lease
commencement date. The Company recognizes lease expense for these leases on a straight-line basis over the lease term.
Most leases include an option to renew, with renewal terms that can extend the lease terms. The exercise of lease renewal options is at
the Company’s sole discretion. The depreciable life of assets and leasehold improvements are limited by the expected lease terms. The
Company also has a unilateral termination right for most of the ATM site leases. Leases of ATM sites with termination options
exercisable within the next 12 months are excluded from the right of use lease assets and lease liability under the short-term lease
exemption as the termination options are not reasonably certain not to be exercised. Payments for ATM site leases with termination
options subject to the short-term lease exemption are expensed in the period incurred. The short-term lease expense for 2023
reasonably reflects the Company’s short-term lease commitments. Certain of the Company’s lease agreements include variable rental
payments based on revenues generated from the use of the leased location and certain leases include rental payments adjusted
periodically for inflation. Variable lease payments are recognized when the event, activity, or circumstance in the lease agreement on
which those payments are assessed occurs and are excluded from the right of use assets and lease liabilities balances. The lease
agreements do not contain any material residual value guarantees or material restrictive covenants.
Future minimum lease payments
Future minimum lease payments under the operating leases (with initial lease terms in excess of one year) as of December 31, 2023
are:
Maturity of Lease Liabilities (in millions)
2024
2025
2026
2027
2028
Thereafter
Total lease payments
Less: imputed interest
Present value of lease liabilities
As of December
31, 2023
Operating
Leases (1)
$
$
47.0
36.3
26.5
17.9
9.4
12.4
149.5
(7.4 )
142.1
(1) Operating lease payments reflect the Company’s current fixed obligations under the operating lease agreements.
A Network of Enablement
101
Lease expense recognized in the Consolidated Statements of Operations is summarized as follows:
Lease Expense (in millions)
Operating lease expense
Variable lease expense
Total lease expense
Income Statement
Classification
Selling, general and
administrative and Direct
operating costs
Selling, general and
administrative and Direct
operating costs
Year ended
December 31,
2023
Year ended
December 31,
2022
Year ended
December 31,
2021
$
50.1 $
51.0 $
55.6
164.3
142.6
$
214.4 $
193.6 $
116.0
171.6
Other information about lease amounts recognized in the consolidated financial statements is summarized as follows:
Lease Term and Discount Rate of Operating Leases
Weighted- average remaining lease term (years)
Weighted- average discount rate
As of
December 31,
2023
As of
December 31,
2022
4.3
4.6
2.49 %
2.27 %
The following table presents supplemental cash flow and non-cash information related to leases:
Other Information (in millions)
Cash paid for amounts included in the measurement of lease liabilities (a)
Supplemental non-cash information on lease liabilities arising from obtaining
ROU assets:
Year ended
December 31,
2023
Year ended
December 31,
2022
Year ended
December 31,
2021
$
49.9 $
49.7 $
51.5
ROU assets obtained in exchange for new operating lease liabilities
$
49.9 $
50.0 $
69.1
(a) Included in Net cash provided by operating activities on the Company’s Consolidated Statements of Cash Flows.
102
Euronet | 2023 Annual Report
(15) INCOME TAXES
The sources of income before income taxes for the years ended December 31, 2023, 2022 and 2021 are presented as follows:
(in millions)
Income before taxes:
United States
Foreign
Total income before income taxes
Year Ended December 31,
2023
2022
2021
$
$
7.0 $
393.4
400.4 $
(12.5 ) $
335.1
322.6 $
(4.8 )
140.4
135.6
The Company’s income tax expense for the years ended December 31, 2023, 2022 and 2021 consisted of the following:
(in millions)
Current tax expense (benefit):
U.S.
Foreign
Total current
Deferred tax expense (benefit):
U.S.
Foreign
Total deferred
Total tax expense
Year Ended December 31,
2023
2022
2021
$
5.1 $
102.9
108.0
12.2
0.7
12.9
$
120.9 $
3.9 $
80.3
84.2
(7.3 )
15.0
7.7
91.9 $
2.8
59.9
62.7
12.3
(9.9 )
2.4
65.1
The following is a reconciliation of the federal statutory income tax rates of 21% to the effective income tax rate for the years ended
December 31, 2023, 2022 and 2021:
(dollar amounts in millions)
Year Ended December 31,
2023
2022
2021
U.S. federal income tax expense at applicable statutory rate
$
84.1
$
67.7
$
28.5
Tax effect of:
State income tax expense at statutory rates, net of U.S. federal income tax
Non-deductible expenses
Share-based compensation
Other permanent differences
Difference between U.S. federal and foreign tax rates
Provision in excess of statutory rates
Change in federal and foreign valuation allowance
GILTI, net of tax credits
Tax credits
Other
Total income tax expense
Effective tax rate
3.7
2.9
4.0
0.9
16.7
8.3
2.7
5.9
(9.2 )
0.9
120.9
$
$
3.7
1.7
1.9
(0.2 )
13.9
3.6
(7.7 )
9.8
(0.7 )
(1.8 )
91.9
$
1.5
0.5
(3.5 )
(2.0 )
7.4
2.9
26.7
3.9
(1.1 )
0.3
65.1
30.19 %
28.47 %
48.00 %
We calculate our provision for federal, state and foreign income taxes based on current tax law.
A Network of Enablement
103
The tax effect of temporary differences and carryforwards that give rise to deferred tax assets and liabilities from continuing
operations are as follows:
(in millions)
Deferred tax assets:
Tax loss carryforwards
Share-based compensation
Accrued expenses
Property and equipment
Goodwill and intangible amortization
Contract costs
Intercompany notes
Accrued revenue
Tax credits
Lease accounting
Foreign exchange
Capitalized research and development
Other
Total deferred tax assets
Valuation allowance
Total deferred tax assets, net of valuation allowance
Deferred tax liabilities:
Intangible assets related to purchase accounting
Goodwill and intangible amortization
Accrued expenses
Intercompany notes
Accrued interest
Capitalized research and development
Property and equipment
Accrued revenue
Lease accounting
Foreign exchange
Other
Total deferred tax liabilities
Net deferred tax liabilities
As of December 31,
2023
2022
$
59.3 $
15.8
20.1
8.1
11.2
3.5
16.7
4.0
58.1
49.2
2.4
6.2
6.0
260.6
(90.7 )
169.9
(15.0 )
(31.9 )
(25.7 )
(12.9 )
(34.4 )
(0.3 )
(6.8 )
(2.8 )
(49.2 )
(4.0 )
(5.6 )
(188.6 )
$
(18.7 ) $
64.9
12.6
23.2
10.8
9.0
7.0
17.4
5.1
64.4
40.2
2.7
—
7.8
265.1
(90.4 )
174.7
(12.1 )
(31.7 )
(22.7 )
(14.5 )
(26.6 )
(1.2 )
(14.6 )
(2.1 )
(40.2 )
(9.8 )
(3.5 )
(179.0 )
(4.3 )
Subsequently recognized tax benefits relating to the valuation allowance for deferred tax assets as of December 31, 2023 are expected
to be allocated to income taxes in the Consolidated Statements of Operations. As of December 31, 2023, and 2022, the Company’s
foreign tax loss carryforwards were $247.4 million and $260.6 million, respectively, and U.S. state tax loss carryforwards were $68.4
million and $97.7 million, respectively.
As of December 31, 2023, the Company had U.S. foreign tax credit carryforwards of $53.6 million which are largely not expected to
be utilized in future periods. As of December 31, 2022, the Company had U.S. foreign tax credit carryforwards of $59.8 million which
are largely not expected to be utilized in future periods.
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Euronet | 2023 Annual Report
In assessing the Company’s ability to realize deferred tax assets, management considers whether it is more likely than not that some
portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income during the periods in which those temporary differences become deductible. Management
considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this
assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the
deferred tax assets are deductible, management believes it is more likely than not the Company will realize the benefits of these
deductible differences, net of the existing valuation allowances, as of December 31, 2023.
As of December 31, 2023, the Company had foreign tax net operating loss carryforwards of $247.4 million, which will expire
as follows:
(in millions)
Year ending December 31,
2024
2025
2026
2027
2028
Thereafter
Unlimited
Total
Gross
Tax Effected
$
1.7 $
13.1
18.3
3.6
4.1
20.3
186.3
$
247.4 $
0.4
3.3
4.6
0.9
1.0
5.3
42.2
57.7
In addition, the Company’s state tax net operating loss carryforwards of $68.4 million will expire periodically from 2024 through
2043, U.S. foreign tax credit carryforwards of $53.6 million will expire periodically from 2027 through 2032 and U.S. federal research
and expenditure credit carryforwards of $3.8 million will expire periodically from 2034 through 2042.
The Company has not provided additional deferred taxes with respect to items such as certain foreign exchange gains or losses,
foreign withholding taxes or additional state taxes, if any, on undistributed earnings attributable to foreign subsidiaries and it is not
practical to determine the income tax liability that would be payable if such earnings were not reinvested indefinitely. Gross
undistributed earnings reinvested indefinitely in foreign subsidiaries aggregated approximately $2,356.1 million as of December 31,
2023.
Accounting for uncertainty in income taxes
A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended December 31, 2023 and 2022 is
as follows:
(in millions)
Beginning balance
Additions based on tax positions related to the current year
Additions for tax positions of prior years
Reductions for tax positions of prior years
Statute of limitations expiration
Ending balance
Year Ended December 31,
2023
2022
$
42.8 $
7.2
2.6
(0.1 )
(0.7 )
$
51.8 $
41.0
6.1
0.3
(4.0 )
(0.6 )
42.8
As of December 31, 2023 and 2022, approximately $38.2 million and $30.8 million, respectively, of the unrecognized tax benefits
would impact the Company’s provision for income taxes and effective income tax rate, if recognized. Total estimated accrued interest
and penalties related to the underpayment of income taxes was $10.0 million and $8.3 million as of December 31, 2023 and 2022,
respectively. The following income tax years remain open in the Company’s major jurisdictions as of December 31, 2023:
A Network of Enablement
105
Jurisdictions
U.S. (Federal)
Germany
Greece
Spain
U.K.
Periods
2014 through 2023
2016 through 2023
2013 through 2023
2016 through 2023
2019 through 2023
It is reasonably possible that the balance of gross unrecognized tax benefits could significantly change within the next twelve months
as a result of the resolution of audit examinations and expirations of certain statutes of limitations and, accordingly, materially affect
the Company’s operating results. At this time, it is not possible to estimate the range of change due to the uncertainty of potential
outcomes.
(16) VALUATION AND QUALIFYING ACCOUNTS
Trade accounts receivable and accounts receivable balances included within the settlement assets are stated net of credit losses.
Historically, the Company has not experienced significant write-offs. The Company records credit losses when it is probable that the
accounts receivable balance will not be collected.
The following table provides a summary of the credit loss balances and activity for the years ended December 31, 2023,
2022 and 2021:
(in millions)
Beginning balance-credit losses
Additions-charged to expense
Amounts written off
Other (primarily changes in foreign currency exchange rates)
Ending balance-credit losses
$
39.3 $
Year Ended December 31,
2023
2022
2021
$
37.0 $
31.8 $
13.3
(9.8 )
(1.2 )
16.3
(12.9 )
1.8
37.0 $
41.7
9.7
(21.6 )
2.0
31.8
(17) STOCK PLANS
The Company has share-based compensation plans (“SCP”) that allow it to grant restricted shares, or options to purchase shares, of
common stock to certain current and prospective key employees, directors, and consultants of the Company. These awards generally
vest over periods ranging from three to five years from the date of grant. Stock options are generally exercisable during the shorter of
a ten-year term or the term of employment with the Company. With the exception of certain awards made to the Company’s
employees in Germany, Singapore and Malaysia, awards under the SCP are settled through the issuance of new shares under the
provisions of the SCP. For Company employees in Germany, Singapore and Malaysia, certain awards are settled through the issuance
of treasury shares, which also reduces the number of shares available for future issuance under the SCP. As of December 31, 2023, the
Company has approximately 3.9 million in total shares remaining available for issuance under the SCP.
Share-based compensation expense was $53.7 million, $44.1 million, and $36.5 million for the years ended December 31, 2023, 2022
and 2021, respectively, and was recorded in salaries and benefits expense in the accompanying Consolidated Statements of
Operations. The Company recorded a tax benefit of $4.0 million, $3.4 million, and $4.1 million during the years ended December 31,
2023, 2022 and 2021, respectively, for the portion of this expense that relates to foreign tax jurisdictions in which an income tax
benefit is expected to be derived.
106
Euronet | 2023 Annual Report
Stock options
Summary stock options activity is presented in the table below:
Weighted
Average
Remaining
Contractual
Term
(years)
Weighted
Average
Exercise Price
Aggregate
Intrinsic
Value
(millions)
Number of
Shares
Balance at December 31, 2022 (1,466,983 shares exercisable)
4,703,405 $
103.51
Granted
Exercised
Forfeited/Canceled
Expired
Balance at December 31, 2023
Exercisable at December 31, 2023
595,777 $
(152,209 ) $
(27,981 ) $
— $
5,118,992 $
91.66
90.92
116.58
—
103.66
2,211,566 $
103.03
Vested and expected to vest at December 31, 2023
4,170,033 $
99.90
6.6 $
4.9 $
6.4 $
39.5
24.6
33.6
Options outstanding that are expected to vest are net of estimated future forfeitures. The Company received cash of $5.4 million,
$5.9 million, and $7.8 million in connection with stock options exercised in the years ended December 31, 2023, 2022 and 2021,
respectively. The intrinsic value of these options exercised was $6.3 million, $12.8 million, and $27.7 million in the years ended
December 31, 2023, 2022 and 2021, respectively. As of December 31, 2023, unrecognized compensation expense related to nonvested
stock options that are expected to vest totaled $45.1 million and will be recognized over the next 4 years, with an overall weighted-
average period of 3.1 years. The following table provides the fair value of options granted under the SCP during 2023, 2022 and 2021,
together with a description of the assumptions used to calculate the fair value using the Black-Scholes-Merton option-pricing model or
Monte Carlo simulation model:
Volatility
Risk-free interest rate - weighted average
Risk-free interest rate - range
Dividend yield
Assumed forfeitures
Expected lives
Weighted-average fair value (per option)
Year ended December 31,
2023
2022
2021
42.5 %
4.23 %
42.4 %
3.97 %
39.3 %
1.2 %
3.97% to
0.50% to
4.23 %
3.45 %
— %
8.0 %
— %
8.0 %
1.21 %
— %
8.0 %
5.0 years
4.6 years
4.6 years
$
39.43
$
37.15
$
39.99
During 2023, the Company granted 596,127 options, which vest evenly over a five year term upon the achievement of a 10% increase
over the share price on the date of grant for 30 consecutive days. During 2022, the Company granted approximately 411,648
options, which vest evenly over a four year term upon the achievement of a 10% increase over the share price on the date of grant for
30 consecutive days. During 2021, the Company granted approximately 331,000 options, which vest evenly over a four year term
upon the achievement of a 10% increase over the share price on the date of grant for 30 consecutive days.
Restricted stock
Restricted stock awards vest based on the achievement of time-based service conditions and/or performance-based conditions. For
certain awards, vesting is based on the achievement of more than one condition of an award with multiple time-based and/or
performance-based conditions. The Company records related expenses for these awards that have performance-based conditions over
the vesting period when the achievement of the award is probable of occurrence.
A Network of Enablement
107
Summary restricted stock activity is presented in the table below:
Nonvested at December 31, 2022
Granted
Vested
Forfeited
Nonvested at December 31, 2023
Weighted
Average
Grant Date
Fair Value
Per Share
Number
of Shares
676,435 $
267,678 $
115.36
92.76
(146,716 ) $
123.78
(30,695 ) $
145.87
766,702 $
104.65
The fair value of shares vested in the years ended December 31, 2023, 2022 and 2021 was $14.8 million, $9.3 million, and $13.8
million, respectively. As of December 31, 2023, there was $16.6 million of total unrecognized compensation cost related to unvested
time-based restricted stock, which is expected to be recognized over a weighted-average period of 2.94 years. As of December 31,
2023, there was $28.8 million of total unrecognized compensation costs related to unvested performance-based restricted stock, which
is expected to be recognized based on Company performance over a weighted-average period of 1.85 years. The weighted average
grant date fair value of restricted stock granted during the years ended December 31, 2023, 2022 and 2021 was $92.76, 91.47 and
$115.85 per share, respectively.
(18) BUSINESS SEGMENT INFORMATION
Euronet’s reportable operating segments have been determined in accordance with ASC Topic 280, Segment Reporting (“ASC 280”).
The Company currently operates in the following three reportable operating segments:
1) Through the EFT Processing Segment, the Company processes transactions for a network of ATMs and POS terminals across
Europe, the Middle East, Africa, Asia Pacific and the United States. The Company provides comprehensive electronic payment
solutions consisting of ATM cash withdrawal services, ATM network participation, outsourced ATM and POS management solutions,
credit, debit and prepaid card outsourcing, dynamic currency conversion, domestic and international surcharges and other value-added
services. Through this segment, the Company also offers a suite of integrated electronic financial transaction software solutions for
electronic payment and transaction delivery systems.
2) Through the epay Segment, the Company provides distribution, processing and collection services for prepaid mobile airtime
and other electronic payment products in Europe, the Middle East, Asia Pacific, the U.S., and South America.
3) Through the Money Transfer Segment, the Company provides global money transfer services under the brand names Ria,
AFEX, IME, and xe. Ria, AFEX, and IME provide global consumer-to-consumer money transfer services through a network of
sending agents, Company-owned stores and Company-owned websites, disbursing money transfers through a worldwide
correspondent network. xe offers account-to-account international payment services to high-income individuals and small-to-medium
sized businesses. xe is also a provider of foreign currency exchange information. The Company also offers customers bill payment
services, payment alternatives such as money orders and prepaid debit cards, comprehensive check cashing services, foreign currency
exchange services and mobile top-up. Furthermore, xe provides cash management solutions and foreign currency risk management
services to small-to-medium sized businesses.
In addition, the Company accounts for non-operating activity, share-based compensation expense, certain intersegment eliminations
and the costs of providing corporate and other administrative services in its administrative division, “Corporate Services, Eliminations
and Other.” These services are not directly identifiable with the Company’s reportable operating segments.
108
Euronet | 2023 Annual Report
The following tables present the Company’s results for the years ended December 31, 2023, 2022 and 2021:
(in millions)
Total revenues
Operating expenses:
Direct operating costs
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
For the Year Ended December 31, 2023
EFT
Processing
epay
Money
Transfer
Corporate
Services,
Eliminations
and Other
Consolidated
$
1,058.3 $
1,082.4 $
1,555.2 $
(7.9 ) $
3,688.0
572.1
126.5
58.8
94.6
819.1
91.1
39.1
6.9
839.5
310.5
188.8
31.0
852.0
956.2
1,369.8
(7.9 )
74.8
10.1
0.4
77.4
2,222.8
602.9
296.8
132.9
3,255.4
Operating income (expense)
$
206.3 $
126.2 $
185.4 $
(85.3 ) $
432.6
Other income (expense)
Interest income
Interest expense
Foreign currency exchange gain, net
Other gains, net
Total other expense, net
Income before income taxes
15.2
(55.6 )
8.0
0.2
(32.2 )
$
400.4
Segment assets as of December 31, 2023
$
2,442.0 $
1,204.9 $
1,921.2 $
326.3 $
5,894.4
A Network of Enablement
109
(in millions)
Total revenues
Operating expenses:
Direct operating costs
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
For the Year Ended December 31, 2022
EFT
Processing
epay
Money
Transfer
Corporate
Services,
Eliminations
and Other
Consolidated
$
924.2 $
997.9 $
1,444.5 $
(7.8 ) $
3,358.8
475.8
111.9
57.1
95.4
753.2
81.8
36.0
6.2
796.9
277.0
182.2
33.9
(7.7 )
63.5
9.8
0.4
2,018.2
534.2
285.1
135.9
740.2
877.2
1,290.0
66.0
2,973.4
Operating income (expense)
$
184.0 $
120.7 $
154.5 $
(73.8 ) $
385.4
Other income (expense)
Interest income
Interest expense
Foreign currency exchange loss, net
Other gains, net
Total other expense, net
Income before income taxes
2.0
(37.5 )
(28.2 )
0.9
(62.8 )
$
322.6
Segment assets as of December 31, 2022
$
2,150.7 $
1,173.3 $
1,795.8 $
283.8 $
5,403.6
110
Euronet | 2023 Annual Report
(in millions)
Total revenues
Operating expenses:
Direct operating costs
Acquired contract cost impairment
Salaries and benefits
Selling, general and administrative
Depreciation and amortization
Total operating expenses
For the Year Ended December 31, 2021
EFT
Processing
epay
Money
Transfer
and Other Consolidated
Corporate
Services,
Eliminations
$
591.2 $
1,011.5 $ 1,400.9 $
(8.1 ) $
2,995.5
354.2
760.9
793.2
—
98.6
47.9
90.9
—
79.5
39.6
8.5
38.6
255.7
157.9
36.0
(8.1 )
—
51.1
6.6
0.4
1,900.2
38.6
484.9
252.0
135.8
591.6
888.5
1,281.4
50.0
2,811.5
Operating income (expense)
$
(0.4 ) $
123.0 $
119.5 $
(58.1 ) $
184.0
Other income (expense)
Interest income
Interest expense
Foreign currency exchange loss, net
Other gains, net
Total other expense, net
Income before income taxes
0.7
(38.3 )
(10.8 )
—
(48.4 )
$
135.6
Segment assets as of December 31, 2021
$
1,682.7 $
1,234.1 $ 1,621.7 $
205.8 $
4,744.3
A Network of Enablement
111
Total revenues for the years ended December 31, 2023, 2022 and 2021, and property and equipment and total assets as of December
31, 2023 and 2022, summarized by geographic location, were as follows:
(in millions)
United States
Germany
Spain
United Kingdom
Italy
Poland
India
France
Greece
Malaysia
Australia
New Zealand
Netherlands
Canada
Brazil
Other
Total foreign
Total
Revenues
For the year ended December 31,
Property and Equipment,
net as of December 31,
Total Assets
as of December 31,
2023
2022
2021
2023
2022
2023
2022
$
898.5 $
830.8 $
805.0 $
63.0 $
59.9 $ 1,198.5 $ 1,051.4
691.5
644.5
243.4
211.7
152.5
185.8
114.9
170.3
198.6
144.7
160.7
98.1
188.5
173.8
205.8
161.0
51.9
53.5
51.6
62.8
70.1
55.2
47.6
42.4
61.6
54.6
66.4
51.4
631.5
157.8
143.9
130.1
93.7
173.1
166.7
61.6
50.0
46.9
56.5
49.4
46.9
44.3
29.0
40.8
8.7
14.9
28.8
28.5
8.6
19.6
4.3
1.9
4.0
5.0
0.7
0.3
30.2
46.4
10.5
16.7
23.0
30.5
8.5
18.0
2.2
2.9
3.5
5.3
0.7
0.3
760.2
375.5
441.3
229.9
280.7
241.4
165.0
653.9
98.5
85.6
190.7
170.9
123.7
38.2
772.6
322.6
403.9
207.7
220.7
241.6
140.4
597.2
77.6
58.4
234.8
196.7
106.4
46.7
481.6
421.0
338.1
74.0
78.0
840.4
724.9
2,789.5
2,528.0
2,190.5
269.1
276.7
4,695.9
4,352.2
$ 3,688.0 $ 3,358.8 $ 2,995.5 $
332.1 $
336.6 $ 5,894.4 $ 5,403.6
(19) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
Concentrations of credit risk
The Company’s credit risk primarily relates to trade accounts receivable and cash and cash equivalents. The EFT Processing
Segment’s customer base includes the most significant international card organizations and certain banks in its markets. The epay
Segment’s customer base is diverse and includes several major retailers and/or distributors in markets that they operate. The Money
Transfer Segment trade accounts receivable is primarily due from independent agents that collect cash from customers on the
Company’s behalf and generally remit the cash within one week. The Company performs ongoing evaluations of its customers’
financial condition and limits the amount of credit extended, or purchases credit enhancement protection, when deemed necessary, but
generally requires no collateral. See Note 16, Valuation and Qualifying Accounts, to the Consolidated Financial Statements for further
disclosure.
The Company invests excess cash not required for use in operations primarily in high credit quality, short-term duration securities that
the Company believes bear minimal risk.
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Euronet | 2023 Annual Report
Fair value measurements
Fair value measurements used in the consolidated financial statements are based upon the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy
distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources
(observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best
information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives
the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to
unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:
• Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities.
• Level 2 — Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or
other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets
or liabilities.
• Level 3 — Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own
assumptions about the inputs that market participants would use in pricing.
The following table details financial assets measured and recorded at fair value on a recurring basis:
(in millions)
Assets
Foreign currency exchange contracts
Liabilities
Foreign currency exchange contracts
(in millions)
Assets
Foreign currency exchange contracts
Liabilities
Balance Sheet
Classification
Level 1
Level 2
Level 3
Total
As of December 31, 2023
Other current assets
$
— $
50.0 $
— $
50.0
Other current liabilities $
— $
(39.1 ) $
— $
(39.1 )
Balance Sheet
Classification
Level 1
Level 2
Level 3
Total
As of December 31, 2022
Other current assets
$
— $
50.3 $
— $
50.3
Foreign currency exchange contracts
Other current liabilities $
— $
(42.3 ) $
— $
(42.3 )
The carrying amounts of cash and cash equivalents, trade accounts receivable, trade accounts payable and short-term debt obligations
are approximate fair values due to their short maturities. The carrying amount of the convertible notes receivable approximates fair
value because we issued the notes on October 18, 2023. The carrying values of the Company’s revolving credit agreements
approximate fair values because interest is based on SOFR that resets at various intervals of less than one year. The Company
estimates the fair value of the Convertible Notes and Senior Notes using quoted prices in inactive markets for identical liabilities
(Level 2). As of December 31, 2023, the fair values of the Convertible Notes and Senior Notes were $530.3 million and
$621.6 million, respectively, with carrying values of $525.0 million and $662.2 million, respectively.
(20) LITIGATION AND CONTINGENCIES
From time to time, the Company is a party to legal and regulatory proceedings arising in the ordinary course of its business. Currently,
there are no legal proceedings or regulatory findings that management believes, either individually or in aggregate, would have a
material adverse effect upon the Consolidated Financial Statements of the Company. In accordance with U.S. GAAP, the Company
records a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.
These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal
counsel, and other information and events pertaining to a particular case.
A Network of Enablement
113
(21) COMMITMENTS
As of December 31, 2023, the Company had $80.0 million of stand-by letters of credit/bank guarantees issued on its behalf, of which
$3.4 million are collateralized by cash deposits held by the respective issuing banks.
Under certain circumstances, the Company grants guarantees in support of the obligations of subsidiaries. As of December 31, 2023,
the Company granted off balance sheet guarantees for cash in various ATM networks amounting to $11.2 million over the terms of the
cash supply agreements and performance guarantees amounting to approximately $75.0 million over the terms of the agreements with
the customers.
From time to time, the Company enters into agreements with commercial counterparties that contain indemnification provisions, the
terms of which may vary depending on the negotiated terms of each respective agreement. The amount of such potential obligations is
generally not stated in the agreements. Euronet’s liability under such indemnification provisions may be mitigated by relevant
insurance coverage and may be subject to time and materiality limitations, monetary caps and other conditions and defenses. Such
indemnification obligations include the following:
• In connection with contracts with financial institutions in the EFT Processing Segment, the Company is responsible for damage to
ATMs and theft of ATM network cash that, generally, is not recorded on the Company’s Consolidated Balance Sheets. As
of December 31, 2023, the balance of such cash used in the Company’s ATM networks for which the Company was responsible
was approximately $576.2 million. The Company maintains insurance policies to mitigate this exposure;
• In connection with contracts with certain customers the Company is responsible for losses suffered by those customers and other
parties as a result of the breach of its computer systems, including in particular, losses arising from fraudulent transactions made
using information stolen through its processing systems. The Company maintains insurance policies to mitigate this exposure;
• In connection with the license of proprietary systems to customers, the Company provides certain warranties and infringement
indemnities to the licensee, which generally warrant that such systems do not infringe on intellectual property owned by third
parties and that the systems will perform in accordance with their specifications;
• Euronet has entered into purchase and service agreements with vendors and consulting agreements with providers of consulting
services, pursuant to which the Company has agreed to indemnify certain of such vendors and consultants, respectively, against
third-party claims arising from the Company’s use of the vendor’s product or the services of the vendor or consultant;
• In connection with acquisitions and dispositions of subsidiaries, operating units and business assets, the Company has entered into
agreements containing indemnification provisions, which can be generally described as follows: (i) in connection with acquisitions
of operating units or assets made by Euronet, the Company has agreed to indemnify the seller against third party claims made
against the seller relating to the operating unit or asset and arising after the closing of the transaction, and (ii) in connection with
dispositions made by Euronet, Euronet has agreed to indemnify the buyer against damages incurred by the buyer due to the buyer’s
reliance on representations and warranties relating to the subject subsidiary, operating unit or business assets in the disposition
agreement if such representations or warranties were untrue when made; and
• Euronet has entered into agreements with certain third parties, including banks that provide fiduciary and other services to Euronet
or to the Company’s benefit plans. Under such agreements, the Company has agreed to indemnify such service providers for third-
party claims relating to carrying out their respective duties under such agreements.
The Company is also required to meet minimum capitalization and cash requirements of various regulatory authorities in the
jurisdictions in which the Company has money transfer operations. The Company has obtained surety bonds in compliance with
money transfer licensing requirements of the applicable governmental authorities.
To date, the Company is not aware of any significant claims made by the indemnified parties or third parties to guarantee agreements
with the Company and, accordingly, no liabilities were recorded as of December 31, 2023 or 2022.
(22) RELATED PARTY TRANSACTIONS
The Company leases an airplane from a company owned by Mr. Michael J. Brown, Euronet’s Chief Executive Officer, President, and
Chairman of the Board of Directors. The airplane is leased for business use on a per flight hour basis at competitive commercial rates
114
Euronet | 2023 Annual Report
with no minimum usage requirement. Euronet incurred expenses of $0.2 million, $0.2 million, and $0.1 million during the years ended
December 31, 2023, 2022 and 2021, respectively, for the use of this airplane.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Our executive management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the
design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(b) under the Exchange Act as of December
31, 2023. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that the design and
operation of these disclosure controls and procedures were effective as of such date to provide reasonable assurance that information
required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management,
including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required
disclosures.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
There has been no change in our internal control over financial reporting during the fourth quarter of 2023 that has materially affected,
or is reasonably likely to materially affect, our internal control over financial reporting.
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
To the Stockholders of Euronet Worldwide, Inc.:
Management is responsible for establishing and maintaining an effective internal control over financial reporting as this term is
defined under Rule 13a-15(f) of the Securities Exchange Act of 1934 and has made organizational arrangements providing appropriate
divisions of responsibility and has established communication programs aimed at assuring that its policies, procedures and principles
of business conduct are understood and practiced by its employees. All internal control systems, no matter how well designed, have
inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to
financial statement preparation and presentation.
Management of Euronet Worldwide, Inc. assessed the effectiveness of the Company’s internal control over financial reporting as
of December 31, 2023. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission in Internal Control-Integrated Framework (2013). Based on these criteria and our assessment, we have
determined that, as of December 31, 2023, the Company’s internal control over financial reporting was effective.
The effectiveness of the Company’s internal control over financial reporting as of December 31, 2023, has been audited by KPMG
LLP, an independent registered public accounting firm, as stated in their audit report, included herein.
/s/ Michael J. Brown
Michael J. Brown
Chief Executive Officer
/s/ Rick L. Weller
Rick L. Weller
Chief Financial Officer and Chief Accounting Officer
February 22, 2024
A Network of Enablement
115
ITEM 9B. OTHER INFORMATION
During the fiscal quarter ended December 31, 2023, none of the Company’s directors or “officers,” as defined in Rule 16a-1(f) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), adopted or terminated a “Rule 10b5-1 trading arrangement” or a
“non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
None.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
PART III
The information under “Election of Directors,” “Delinquent Section 16(a) Reports” (if applicable) and “Meetings and Committees of
the Board of Directors” in the Proxy Statement for the 2024 Annual Meeting of Stockholders, which will be filed with the SEC no
later than 120 days after December 31, 2023, is incorporated herein by reference. Information concerning our Code of Business
Conduct and Ethics for our employees, including our Chief Executive Officer and Chief Financial Officer, is set forth under
“Availability of Reports, Certain Committee Charters, and Other Information” in Part I of this Annual Report on Form 10-K and
incorporated herein by reference. Information concerning executive officers is set forth under “Information about our Executive
Officers” in Part I of this Annual Report on Form 10-K and incorporated herein by reference.
We intend to satisfy the requirement under Item 5.05 of Form 8-K to disclose any amendments to our Code of Business Conduct and
Ethics and any waiver from a provision of our Code of Ethics by disclosing such information on a Form 8-K or on our Website at
www.euronetworldwide.com under For Investors/Corporate Governance.
ITEM 11. EXECUTIVE COMPENSATION
The information under “Compensation Tables,” “Compensation Discussion and Analysis,” “Director Compensation,” “Compensation
Committee Report” and “Compensation Committee Interlocks and Insider Participation” in the Proxy Statement for the 2024 Annual
Meeting of Stockholders, which will be filed with the SEC no later than 120 days after December 31, 2023, is incorporated herein
by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
The information under “Beneficial Ownership of Common Stock”, “Election of Directors” and “Compensation Tables - Shares
Issuable under Stockholder Approved Plans” in the Proxy Statement for the 2024 Annual Meeting of Stockholders, which will be filed
with the SEC no later than 120 days after December 31, 2023, is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information under “Certain Relationships and Related Transactions and Director Independence” in the Proxy Statement for
the 2024 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after December 31, 2023, is
incorporated herein by reference.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The information under “Audit Matters — Fees of the Company’s Independent Auditors” and — “Audit Matters — Audit Committee
Pre-Approval Policy” in the Proxy Statement for the 2024 Annual Meeting of Stockholders, which will be filed with the SEC no later
than 120 days after December 31, 2023, is incorporated herein by reference.
116
Euronet | 2023 Annual Report
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
PART IV
(a) List of Documents Filed as Part of this Report.
1. Financial Statements
The Consolidated Financial Statements and accompanying notes, together with the report of KPMG LLP, appear in Part II, Item 8
- Financial Statements and Supplementary Data, of this Form 10-K.
2. Schedules
None.
3. Exhibits
The exhibits that are required to be filed or incorporated by reference herein are listed in the Exhibit Index below.
Exhibit Index
Exhibit
EXHIBITS
Description
3.1
Certificate of Incorporation of Euronet Worldwide, Inc., as amended (filed as Exhibit 3.2 to the Company’s Current
Report on Form 8-K filed on May 22, 2009 and incorporated by reference herein)
3.2
Certificate of Amendment to Certificate of Incorporation of Euronet Worldwide, Inc. (filed as Exhibit 3.1 to the
Company’s Current Report on Form 8-K filed on May 22, 2009 and incorporated by reference herein)
3.3
Amended and Restated Certificate of Designations, Preferences and Rights of Series A Junior Participating Preferred
Stock (filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on March 29, 2013, and incorporated
herein by reference)
3.4
Amended and Restated Bylaws of Euronet Worldwide, Inc. (filed as Exhibit 3.2 to the Company’s Current Report on
Form 8-K filed on February 28, 2017, and incorporated herein by reference)
4.1
4.2
4.3
4.4
Indenture, dated May 22, 2019, between Euronet Worldwide, Inc. and U.S. Bank National Association, as trustee
(filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on May 22, 2019 and incorporated by
reference herein)
Supplemental Indenture, dated May 22, 2019, between Euronet Worldwide, Inc. and U.S. Bank National Association,
as trustee (filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on May 22, 2019 and incorporated
by reference herein)
Form of 1.375% Senior Note due 2026 (included as Exhibit A to Exhibit 4.1 above).
Indenture, dated March 18, 2019, between the Company and U.S. Bank National Association, as trustee (filed as
Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 18, 2019 and incorporated by reference
herein)
4.5
Form of 0.75% Convertible Senior Note due 2049 (included as Exhibit A to Exhibit 4.4 above)
A Network of Enablement
117
4.6
Description of Securities (filed as Exhibit 4.6 to the Company’s Annual Report on Form 10-K filed on March 3, 2020
and incorporated herein by reference.
10.1
10.2
10.3
10.4
10.5
Form of Employee Restricted Stock Grant Agreement pursuant to Euronet Worldwide, Inc. 2006 Stock Incentive Plan
(filed as Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q filed on August 4, 2006, and incorporated by
reference herein) (2)
Employment Agreement dated June 19, 2007 between Euronet Worldwide, Inc. and Kevin J. Caponecchi (filed as
Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 25, 2007, and incorporated by reference
herein) (2)
Amended and Restated Employment Agreement dated April 10, 2008 between Euronet Worldwide, Inc. and Michael
J. Brown, Chairman and Chief Executive Officer (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form
10-Q filed on May 9, 2008, and incorporated by reference herein) (2)
Amended and Restated Employment Agreement dated April 10, 2008 between Euronet Worldwide, Inc. and Rick L.
Weller, Executive Vice President and Chief Financial Officer (filed as Exhibit 10.4 to the Company’s Quarterly
Report on Form 10-Q filed on May 9, 2008, and incorporated by reference herein) (2)
Amended and Restated Employment Agreement dated April 10, 2008 between Euronet Worldwide, Inc. and Juan C.
Bianchi, Executive Vice President and Managing Director, Money Transfer Segment (filed as Exhibit 10.6 to the
Company’s Quarterly Report on Form 10-Q filed on May 9, 2008, and incorporated by reference herein) (2)
10.6
Form of Indemnification Agreement, (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on
December 22, 2008, and incorporated by reference herein)
10.7
Euronet Worldwide, Inc. 2006 Stock Incentive Plan, as amended and restated (filed as Appendix B to the Company’s
Definitive Proxy Statement filed on April 4, 2021, and incorporated by reference herein) (2)
10.8
10.9.1
10.9.2
10.10
Form of Nonqualified Stock Option Agreement, as amended, pursuant to Euronet Worldwide, Inc. 2006 Stock
Incentive Plan (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on May 7, 2010 and
incorporated by reference herein) (2)
Employment Agreement dated May 21, 2018 between Euronet Worldwide, Inc. and Nikos Fountas (filed as Exhibit
10.1 to the Company’s Current Report on Form 8-K filed on May 23, 2018 and incorporated by reference herein) (2)
Deed of Amendment to the Service Agreement dated May 21, 2018 between Euronet Worldwide, Inc. and Nikos
Fountas (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on August 3, 2018 and
incorporated by reference herein) (2)
Bonus Compensation Agreement between Euronet Worldwide, Inc. and Nikos Fountas, Senior Vice President -
Managing Director, Europe EFT Processing Segment (filed as Exhibit 10.26 to the Company’s Annual Report on
Form 10-K filed on February 25, 2011 and incorporated by reference herein) (2)
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Euronet | 2023 Annual Report
10.11
Euronet Worldwide, Inc. Employee Stock Purchase Plan, as amended (filed as Exhibit 10.18 to the Company’s
Annual Report on Form 10-K filed on February 26, 2016 and incorporated by reference herein) (2)
10.12
10.13
10.14
10.15
21.1
23.1
31.1
31.2
32.1
32.2
97.1
101
Euronet Worldwide, Inc. Executive Annual Incentive Plan, as amended and restated (filed as Appendix B to the
Company’s Definitive Proxy Statement on Form DEF 14A filed on April 8, 2016 and incorporated by reference
herein) (2)
Form of Nonqualified Stock Option Agreement, as amended, pursuant to Euronet Worldwide, Inc. 2006 Stock
Incentive Plan (filed as Exhibit 10.19 to the Company’s Annual Report on Form 10-K filed on March 1, 2018 and
incorporated by reference herein) (2)
Form of Restricted Stock Unit Agreement, as amended, pursuant to Euronet Worldwide, Inc. 2006 Stock Incentive
Plan (filed as Exhibit 10.20 to the Company’s Annual Report on Form 10-K filed on March 1, 2018 and incorporated
by reference herein) (2)
Amended and Restated Credit Agreement dated as of October, 24, 2022 among Euronet Worldwide, Inc. and certain
subsidiaries, as borrowers, certain subsidiaries, as guarantors, the lenders party thereto, Bank of America, N.A., as
administrative agent, Wells Fargo Bank, National Association and U.S. Bank National Association, as co-syndication
agents, et al. (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 25, 2022 and
incorporated by reference herein)
Subsidiaries of the Registrant (1)
Consent of Independent Registered Public Accounting Firm (1)
Section 302 — Certification of Chief Executive Officer (1)
Section 302 — Certification of Chief Financial Officer (1)
Section 906 Certification of Chief Executive Officer (3)
Section 906 Certification of Chief Financial Officer (3)
Incentive Compensation Clawback Policy
The following materials from Euronet Worldwide, Inc.’s Annual Report on Form 10-K for the year ended December
31, 2023, formatted inline XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets at
December 31, 2023 and 2022, (ii) Consolidated Statements of Operations for the years ended December 31, 2023,
2022 and 2021, (iii) Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31,
2023, 2022 and 2021, (iv) Consolidated Statements of Changes in Equity for the years ended December 31, 2023,
2022 and 2021, (v) Consolidated Statements of Cash Flows for the years ended December 31, 2023, 2022 and 2021,
and (vi) Notes to the Consolidated Financial Statements.
Cover Page Interactive Data File (contained in Exhibit 101)
104
___________________________
(1) Filed herewith.
(2) Management contracts and compensatory plans and arrangements required to be filed as Exhibits pursuant to Item 15(a) of
this report.
(3) Pursuant to Item 601(b)(32) of Regulation S-K, this Exhibit is furnished rather than filed with this Form 10-K.
A Network of Enablement
119
PLEASE NOTE: Pursuant to the rules and regulations of the SEC, we have filed or incorporated by reference the agreements
referenced above as exhibits to this Annual Report on Form 10-K. The agreements have been filed to provide investors with
information regarding their respective terms. The agreements are not intended to provide any other factual information about the
Company or its business or operations. In particular, the assertions embodied in any representations, warranties and covenants
contained in the agreements may be subject to qualifications with respect to knowledge and materiality different from those applicable
to investors and may be qualified by information in confidential disclosure schedules not included with the exhibits. These disclosure
schedules may contain information that modifies, qualifies and creates exceptions to the representations, warranties and covenants set
forth in the agreements. Moreover, certain representations, warranties and covenants in the agreements may have been used for the
purpose of allocating risk between the parties, rather than establishing matters as facts. In addition, information concerning the subject
matter of the representations, warranties and covenants may have changed after the date of the respective agreement, which
subsequent information may or may not be fully reflected in the Company’s public disclosures. Accordingly, investors should not rely
on the representations, warranties and covenants in the agreements as characterizations of the actual state of facts about the Company
or its business or operations on the date hereof.
120
Euronet | 2023 Annual Report
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
SIGNATURES
Euronet Worldwide, Inc.
Date: February 22, 2024
Michael J. Brown
Chairman of the Board of Directors, Chief Executive
Officer, President and Director (principal executive officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates indicated.
Signature
/s/ Michael J. Brown
Michael J. Brown
February 22, 2024
/s/ Rick L. Weller
Rick L. Weller
February 22, 2024
/s/ Paul S. Althasen
Paul S. Althasen
February 22, 2024
/s/ Andrzej Olechowski
Andrzej Olechowski
February 22, 2024
/s/ Michael N. Frumkin
Michael N. Frumkin
February 22, 2024
/s/ Thomas A. McDonnell
Thomas A. McDonnell
February 22, 2024
/s/ Andrew B. Schmitt
Andrew B. Schmitt
February 22, 2024
/s/ M. Jeannine Strandjord
M. Jeannine Strandjord
February 22, 2024
/s/ Ligia Torres Fentanes
Ligia Torres Fentanes
February 22, 2024
Title
Chairman of the Board of Directors, Chief Executive Officer,
President and Director (principal executive officer)
Chief Financial Officer and Chief Accounting Officer (principal
financial officer and principal accounting officer)
Director
Director
Director
Director
Director
Director
Director
A Network of Enablement
121
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Euronet | 2023 Annual Report
RECONCILIATION TABLE
Reconciliation of Adjusted Earnings Per Share
(unaudited — in millions, except per share data)
2019
2020
2021
2022
2023
Net income (loss) attributable to Euronet Worldwide, Inc.
$ 346.8
$
(3.4)
$ 70.7
$ 231.0
$ 279.7
Foreign exchange (gain) loss
Intangible asset amortization
Share-based compensation
Post-acquisition adjustment
Goodwill and intangible asset impairment, net of minority interest
Contract asset impairment
Non-cash convertible debt accretion interest
Non-cash gain
Non-cash purchase accounting adjustment
Income tax effect of above adjustments
Loss on early retirement of debt
U.S. tax reform impact
Non-cash GAAP tax expense (benefit)
Adjusted earnings1
Adjusted earnings per share — diluted1
(2.7)
20.4
21.5
(1.3)
–
–
16.2
–
–
(4.9)
9.8
(25.7)
12.9
3.8
22.9
22.0
–
106.6
–
15.3
–
–
10.8
23.1
36.6
–
–
38.6
16.0
–
–
28.2
27.0
44.0
–
–
–
–
–
–
(7.2)
(13.8)
12.7
–
–
–
–
–
–
(8.0)
24.4
53.7
–
–
–
–
(3.0)
2.5
(3.0)
–
–
(8.3)
16.4
(11.3)
19.7
$ 393.0
$ 151.7
$ 198.4
$ 331.6
$ 366.0
$
7.01
$ 2.82
$ 3.69
$ 6.51
$ 7.46
Diluted weighted average shares outstanding
Effect of conversion of convertible debentures
Effect of adjusted EPS dilution of convertible notes
Effect of unrecognized share-based compensation on diluted shares
outstanding
Adjusted diluted weighted average shares outstanding
54.9
0.9
–
0.3
56.1
52.7
0.9
–
0.2
53.8
53.5
–
–
0.2
53.7
53.5
–
(2.8)
0.2
50.9
51.6
–
(2.8)
0.2
49.0
Reconciliation of Operating Income to Adjusted
Operating Income and Adjusted EBITDA
(unaudited — in millions)
Net income (loss)
Add: Income tax expense
Add: Total other expense, net
Operating income
Add: Contract asset impairment
Add: Impairment charges
Less: Post-acquisition adjustment
Less: Non-cash gain
Add: Non-cash purchase accounting adjustment
Adjusted operating income
Add: Depreciation and amortization
Add: Share-based compensation
Earnings before interest, taxes, depreciation, amortization, share-based
compensation, post acquisition adjustments, impairment charges, non-cash
gains, non-cash purchase accounting adjustments, and other non-operating
or non-recurring items (Adjusted EBITDA)
2019
2020
2021
2022
2023
$ 346.7
$
(3.3)
$ 70.5
$ 230.7
$ 279.5
87.2
41.3
11.5
38.4
65.1
48.4
91.9
62.8
120.9
32.2
$ 475.2
$ 46.6
$ 184.0
$ 385.4
$ 432.6
–
–
(1.3)
–
–
–
38.6
106.6
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(3.0)
2.5
$ 473.9
$ 153.2
$ 222.6
$ 385.4
$ 432.1
111.7
21.5
127.0
22.0
135.8
36.6
135.9
44.0
132.9
53.7
$ 607.1
$ 302.2
$ 395.0
$ 565.3
$ 618.7
123
A Network of EnablementAdjusted operating income is defined as operating income excluding goodwill and acquired intangible asset impairments, post-acquisition adjustments, contract asset impairments, non-cash gains, non-cash purchase accounting adjustments and non-recurring items that are considered expenses or income under U.S. GAAP.Adjusted EBITDA is defined as operating income excluding depreciation, amortization, share-based compensation expenses, goodwill and intangible asset impairments, contract asset impairments, post acquisition adjustments, non-cash gains, non-cash purchase accounting adjustments, and other non-operating or non-recurring items. Although these items are considered operating costs under U.S. GAAP, these expenses primarily represent non-cash current period allocation of costs associated with long-lived assets acquired in prior periods. Similarly, expense recorded for share-based compensation does not represent a current or future period cash cost. Adjusted EBITDA is a non-GAAP measure that should be considered in addition to, and not as a substitute for, EBITDA computed in accordance with GAAP.(1) Adjusted earnings and adjusted earnings per share are non-GAAP measures that should be considered in addition to, and not as a substitute for, net income and earnings per share computed in accordance with U.S. GAAP.Note: Adjusted earnings per share is defined as diluted U.S. GAAP earnings per share excluding, to the extent incurred during the period, the tax-effected impacts of: a) foreign exchange gains or losses, b) goodwill and acquired intangible asset impairment charges, c) gains or losses from the early retirement of debt, d) share-based compensation, e) acquired intangible asset amortization, f) contract asset impairments g) non-cash interest expense, h) non-cash income tax expense, i) post acquisition adjustments, j) non-cash gains, k) non-cash purchase accounting adjustments, and l) other non-operating or non-recurring items. Adjusted earnings per share includes shares potentially issuable in settlement of convertible bonds or other obligations, if the assumed issuances are dilutive to adjusted earnings per share. Adjusted earnings per share represents a performance measure and is not intended to represent a liquidity measure. LOOKING FORWARD
Annual Meeting
Euronet’s 2024 Annual Meeting of Stockholders will be held on Thursday,
May 16, 2024, at Euronet’s Corporate Headquarters in Leawood, Kansas.
Website
www.euronetworldwide.com
Forward-Looking Statements
Statements contained in this annual report that concern Euronet’s or
its management’s intentions, expectations, or predictions of future
performance, are forward-looking statements. Euronet’s actual results
may vary materially from those anticipated in such forward-looking
statements as a result of a number of factors, including: conditions in
world financial markets and general economic conditions, including
impacts of the pandemic; the war in Ukraine and the related economic
sanctions; inflation; our ability to successfully integrate the operations
of Piraeus Merchant Services; economic conditions in specific countries
and regions; technological developments affecting the market for our
products and services; our ability to successfully introduce new products
and services; foreign currency exchange rate fluctuations; the effects
of any breach of our computer systems or those of our customers or
vendors, including our financial processing networks or those of other
third parties; interruptions in any of our systems or those of our vendors
or other third parties; our ability to renew existing contracts at profitable
rates; changes in fees payable for transactions performed for cards
bearing international logos or over switching networks such as card
transactions on ATMs; our ability to comply with increasingly stringent
regulatory requirements, including anti-money laundering, anti-terrorism,
anti-bribery, consumer and data protection, privacy, and Second Payment
Service Directive requirements; changes in laws and regulations affecting
our business, including tax and immigration laws and any laws regulating
payments, including dynamic currency conversion transactions; changes
in our relationships with, or in fees charged by our business partners;
competition; the outcome of claims and other loss contingencies
affecting Euronet; the cost of borrowing (including fluctuations in
interest rates), availability of credit and terms of, and compliance with
debt covenants; and renewal of sources of funding as they expire and
the availability of replacement funding. These risks and other risks are
described in the Company’s filings with the Securities and Exchange
Commission, including our Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K. Copies of these
filings may be obtained via the SEC’s Edgar website or by contacting the
Company. Any forward-looking statements made in this release speak
only as of the date of this annual report. Except as may be required by law,
Euronet does not intend to update these forward-looking statements and
undertakes no duty to any person to provide any such update under any
circumstances. The Company regularly posts important information to the
investor relations section of its website.
Office Locations
Amsterdam, the Netherlands
Athens, Greece
Auckland, New Zealand
Beijing, China
Belgrade, Serbia
Berlin, Germany
Billericay, United Kingdom
Bracknell, United Kingdom
Bratislava, Slovakia
Brussels, Belgium
Bucharest, Romania
Budapest, Hungary
Buena Park, California
Cairo, Egypt
Cape Town, South Africa
Copenhagen, Denmark
Dakar, Senegal
Denver, Colorado
Dubai, United Arab Emirates
Dublin, Ireland
Geneva, Switzerland
Hamburg, Germany
Houston, Texas
Istanbul, Turkey
Jakarta, Indonesia
Johannesburg, South Africa
Karachi, Pakistan
Kiev, Ukraine
Kracow, Poland
Kuala Lumpur, Malaysia
Leawood, Kansas
Lisbon, Portugal
Little Rock, Arkansas
London, United Kingdom
Madrid, Spain
Makati City, Philippines
Manama, Bahrain
Martinsreid, Germany
Mexico City, Mexico
Milan, Italy
Milton Keynes, United Kingdom
Montreal, Canada
Mumbai, India
Munich, Germany
Newmarket, Canada
Paris, France
Prague, Czech Republic
Pune, India
Rome, Italy
Rotterdam, the Netherlands
San Salvador, El Salvador
Santiago, Chile
Sao Paulo, Brazil
Shanghai, China
Singapore
Sofia, Bulgaria
Stockholm, Sweden
Sydney, Australia
Toronto, Canada
Vienna, Austria
Warsaw, Poland
Zagreb, Croatia
Local Currency
euro
euro
New Zealand dollar
yuan
dinar
euro
British pound
British pound
euro
euro
new leu
forint
U.S. dollar
Egyptian pound
rand
krone
West African CFA franc
U.S. dollar
dirham
euro
Swiss franc
euro
U.S. dollar
lira
rupiah
rand
Pakistan rupee
hryvnia
zloty
ringgit
U.S. dollar
euro
U.S. dollar
British pound
euro
Philippine peso
dinar
euro
Mexican peso
euro
British pound
Canadian dollar
Indian rupee
euro
Canadian dollar
euro
koruna
Indian rupee
euro
euro
U.S. dollar
Chilean peso
real
yuan
Singapore dollar
lev
krona
Australian dollar
Canadian dollar
euro
zloty
euro
124
Euronet | 2023 Annual Report
Worldwide Office Locations
Worldwide Offices: 67
Worldwide Employees: 10,000
Around the Globe
In 2023, we served customers in more than
200 countries and territories worldwide.
• Office Locations
“More than words, our actions, powered by
our culture of growth, have built an ever-growing,
diverse company that is built to serve the needs
of our customers now and well into the future.”
— Michael J. Brown
Chairman, CEO and President
Read more in his message on page 8
A Network of Enablement
125
ABOUT EURONET
Starting in Central Europe in 1994 and
growing to a global real-time digital
and cash payments network with
millions of touchpoints today, Euronet
now moves money in all the ways
consumers and businesses depend
upon. This includes Money Transfers,
credit/debit processing, ATMs,
point-of-sale services, digital content
distribution, currency exchange and
more. With products and services
in approximately 200 countries
and territories provided through its
own brand and branded business
segments, Euronet and its financial
technologies and networks make
participation in the global economy
easier, faster and more secure for
everyone.
Leawood, Kansas, USA
euronetworldwide.com