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What changed in International Money Express, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of International Money Express, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+358 added−314 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-28)

Top changes in International Money Express, Inc.'s 2024 10-K

358 paragraphs added · 314 removed · 274 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

70 edited+21 added−7 removed78 unchanged
Biggest changeWe believe these online channels not only expand our potential customer base as digital transaction capabilities become more relevant to LAC corridor consumers, but also generate growth from secular and demographic trends as consumers continue to migrate to conducting financial transactions online. 4 Index Segments Our business is organized around one reportable segment that provides money remittance services primarily between the U.S. and Canada to Mexico, Guatemala and other countries in Latin America, Africa and Asia through a network of authorized agents located in various unaffiliated retail establishments and 122 Company-operated stores throughout the U.S., Canada, Spain, Italy and Germany.
Biggest changeSegments Our business is organized around one reportable segment that provides money remittance services primarily between the U.S. and Canada to Mexico, Guatemala and other countries in Latin America, Africa and Asia through a network of authorized agents located in various unaffiliated retail establishments and 117 Company-operated stores throughout the U.S., Canada, Spain, Italy, the United Kingdom and Germany, as well as digitally through the Internet via our websites and mobile device applications.
These services involve the movement of funds on behalf of an originating consumer for receipt by a designated beneficiary at a designated receiving location.
These services involve the movement of funds on behalf of an originating consumer for receipt by a designated beneficiary at a designated receiving location.
Our remittances to LAC countries are primarily generated in the United States by consumers with roots in Latin American and Caribbean countries, many of whom do not have an existing relationship with a traditional full-service financial institution capable of providing the services we offer. We provide these consumers with flexibility and convenience to help them meet their financial needs.
Our remittances to LAC countries are primarily generated in the United States by consumers with roots in Latin American and Caribbean countries, many of whom do not have an existing relationship with a traditional full-service financial institution capable of providing the services we offer. We provide these consumers with flexibility and convenience to help them meet their financial needs.
We believe many consumers who use our services may have access to traditional banking services, but prefer to use our services based on reliability, convenience and value.
We believe many consumers who use our services may have access to traditional banking services, but prefer to use our services based on reliability, convenience and value.
We generate money remittance revenue from fees paid by consumers (i.e., the senders of funds), which we share with our sending agents in the originating country and our paying agents in the destination country.
We generate money remittance revenue from fees paid by consumers (i.e., the senders of funds), which we share with our sending agents in the originating country and our paying agents in the destination country.
Hunt worked at several companies where he held a variety of IT positions with increasing responsibility for all aspects of overall IT strategy, product development, compliance and cybersecurity. Mr. Hunt earned a bachelor’s degree in Business Administration with a major in Decision Information Sciences from the University of Florida in Gainesville, Florida. 11 Index
Hunt worked at several companies where he held a variety of IT positions with increasing responsibility for all aspects of overall IT strategy, product development, 11 Index compliance and cybersecurity. Mr. Hunt earned a bachelor’s degree in Business Administration with a major in Decision Information Sciences from the University of Florida in Gainesville, Florida.
Additionally, we operate a number of retail locations in the United States, Canada, Spain, Italy and Germany, which we refer to as Company-operated stores and where our money remittance services are available. We also operate subsidiary payer networks in Mexico under the Pago Express brand and in Guatemala under the Intermex brand.
Additionally, we operate a number of retail locations in the United States, Canada, Spain, Italy, the United Kingdom and Germany, which we refer to as Company-operated stores and where our money remittance services are available. We also operate subsidiary payer networks in Mexico under the Pago Express brand and in Guatemala under the Intermex brand.
Our money remittance services enable consumers to send funds through our broad network of locations in the United States, Canada, Spain, Italy and Germany that are primarily operated by third-party businesses, as well as through our Company-operated stores, located in those jurisdictions.
Our money remittance services enable consumers to send funds through our broad network of locations in the United States, Canada, Spain, Italy, the United Kingdom and Germany that are primarily operated by third-party businesses, as well as through our Company-operated stores, located in those jurisdictions.
We maintain strong relationships with a number of other national and regional banking and financial institutions in the United States, Canada, Spain, Italy and Latin America. For example, we have maintained a long-term relationship with Wells Fargo, Bank of America and US Bank, among others.
We maintain strong relationships with a number of other national and regional banking and financial institutions in the United States, Canada, Spain, Italy, the United Kingdom and Latin America. For example, we have maintained a long-term relationship with Wells Fargo, Bank of America and US Bank, among others.
We maintain call centers in Mexico and Guatemala, providing call center services 365 days per year and customer service in English, French and Spanish, as well as the possibility of service in many of the regional dialects that our customers speak.
We maintain call centers in Mexico and Guatemala, providing call center services 365 days per year and customer service in English, French, Italian and Spanish, as well as the possibility of service in many of the regional dialects that our customers speak.
A load balancing configuration between tier-1 datacenters, in addition to failover redundancy, provides uptime performance. Our technology platforms have experienced limited downtime, with our 2023 downtime being less than 0.05%. Our Transaction Processing Engine (“TPE”) allows us to process money remittances reliably and quickly by leveraging a proprietary rules engine to apply granular-level product feature customization.
A load balancing configuration between tier-1 datacenters, in addition to failover redundancy, provides uptime performance. Our technology platforms have experienced limited downtime, with our 2024 downtime being less than 0.05 %. Our Transaction Processing Engine (“TPE”) allows us to process money remittances reliably and quickly by leveraging a proprietary rules engine to apply granular-level product feature customization.
Also, our enhanced digital mobile money remittance applications provide consumers with safe, easy-to-use features for remitting funds with a debit or credit card, or ACH transfer. Consumers are able to select a variety of sending methods, including cash pickup at thousands of locations, direct deposit into bank accounts, debit cards, mobile wallets, and home delivery in selected markets.
Consumers are able to select a variety of sending methods, including cash pickup at thousands of locations, direct deposit into bank accounts, debit cards, mobile wallets, and home delivery in selected markets. Also, our enhanced digital mobile money remittance applications provide consumers with safe, easy-to-use features for remitting funds with a debit or credit card.
We use various trademarks and service marks in our business, including, but not limited, to Intermex, International Money Express, IntermexDirect, CheckDirect, La Nacional and Pago Express, some of which are registered in the United States and other countries. In addition, we rely on trade secret protection to protect certain proprietary rights in our information technology, trademarks, and licenses.
We use various trademarks and service marks in our business, including, but not limited, to Intermex, International Money Express, IntermexDirect, CheckDirect, La Nacional, Amigo Paisano and Pago Express, some of which are registered in the United States and other countries. In addition, we rely on trade secret protection to protect certain proprietary rights in our information technology, trademarks, and licenses.
Unclaimed property laws of each state in the United States in which we operate, the District of Columbia, and Puerto Rico require us to track certain information for all of our money remittances and payment instruments and, if the funds underlying such remittances and instruments are unclaimed at the end of an applicable statutory abandonment period, require us to remit the proceeds of the unclaimed property to the appropriate jurisdiction.
Unclaimed property laws of each state in the United States in which we operate, the District of Columbia, and Puerto Rico require us to track certain information for all of our money remittances and payment instruments and, if the funds underlying such remittances and instruments are unclaimed at the end of an applicable statutory abandonment period, require us to remit the proceeds of the 8 Index unclaimed property to the appropriate jurisdiction.
Political, social and economic conditions in key Latin American markets, from which we derive a significant portion of our revenue, continue to exhibit instability, as evidenced by higher interest rates, high unemployment rates, restricted lending activity, higher inflation, volatility in foreign currencies and low consumer confidence, among other economic and market factors.
Political, social and economic conditions in key Latin American markets, from which we derive a significant portion of our revenue, continue to exhibit instability, as evidenced by higher interest rates, high unemployment rates, restricted lending activity, higher immigration patterns, higher inflation, volatility in foreign currencies and low consumer confidence, among other economic and market factors.
Cash Management Bank Relationships We buy and sell a number of global currencies and maintain a network of settlement accounts to facilitate the timely funding of money remittances and foreign exchange trades. Our relationships with clearing, check processing, trading and exchange rate and cash management banks are critical to an efficient and reliable remittance network.
Cash Management Bank Relationships 5 Index We buy and sell a number of global currencies and maintain a network of settlement accounts to facilitate the timely funding of money remittances and foreign exchange trades. Our relationships with clearing, check processing, trading and exchange rate and cash management banks are critical to an efficient and reliable remittance network.
Sales and Marketing The majority of our money remittance transactions are generated through our agent network of retail locations and Company-operated stores where the transaction is processed and payment is collected by our sending agent or store. Sending agent locations include multi-service stores, grocery stores, convenience stores, bodegas and other retail locations.
Sales and Marketing 6 Index The majority of our money remittance transactions are generated through our agent network of retail locations and Company-operated stores where the transaction is processed and payment is collected by our sending agent or store. Sending agent locations include multi-service stores, grocery stores, convenience stores, bodegas and other retail locations.
Our remittance services, which include a comprehensive suite of ancillary financial processing solutions and payment services, are available in all 50 states in the U.S., Washington D.C., Puerto Rico and 13 provinces in Canada, as well as in certain locations in Spain, Italy and Germany, where consumers can send money to beneficiaries in more than 60 countries in LAC, Africa and Asia.
Our remittance services, which include a comprehensive suite of ancillary financial processing solutions and payment services, are available in all 50 states in the U.S., Washington D.C., Puerto Rico and 13 provinces in Canada, as well as in certain locations in Spain, Italy, Germany and the United Kingdom, where consumers can send money to beneficiaries in more than 60 countries in LAC, Africa, Asia and Europe.
These networks contribute payer locations that reach some of the most remote areas in those countries, providing increased convenience to consumers in the United States, Canada, Mexico and Guatemala. At sending agent locations, consumers may initiate a transaction directly with an agent, or through a direct-dialed telephone conversation from the agent location to our call centers.
These networks provide coverage of payer locations that reach some of the most remote areas in those countries, providing increased convenience to consumers in the United States, Canada, Mexico and Guatemala. At sending agent locations, consumers may initiate a transaction directly with an agent, or through a direct-dialed telephone conversation from the agent location to our call centers.
Remittances paid in local currencies that are not pegged to the U.S. dollar, Canadian dollar or Euro can also generate revenue if we are successful in our daily management of currency exchange spreads.
Remittances paid in local currencies that are not pegged to the U.S. dollar, Canadian dollar, Euro or British Pound can also generate revenue if we are successful in our daily management of currency exchange spreads.
Applicable statutory abandonment periods range from three to seven years. We have an ongoing program designed to comply with escheatment laws as they apply to our business. 8 Index Data Privacy and Cybersecurity .
Applicable statutory abandonment periods range from three to seven years. We have an ongoing program designed to comply with escheatment laws as they apply to our business. Data Privacy and Cybersecurity .
Our internally developed and proprietary payer Application Programming Interface platform securely and efficiently integrates our TPE directly with the platforms of our paying agents, so that we can deliver money remittances quickly to our paying agents while optimizing the efficiency/speed of adding new payers to our network and integrating payers’ software and systems with our software and systems.
Our internally developed and proprietary payer Application Programming Interface (“API”) platform securely and efficiently integrates our TPE directly with the platforms of our paying agents, so that we can rapidly deliver money remittances to our paying agents while optimizing the efficiency/speed of adding new payers to our network and integrating payers’ software and systems with our software and systems.
Our services are accessible in person through over 100,000 independent sending and paying agents and 122 Company-operated stores, as well as online and via Internet-enabled mobile devices.
Our services are accessible in person through over 100,000 independent sending and paying agents and 117 Company-operated stores, as well as online and via Internet-enabled mobile devices.
In addition, we have benefited from our long relationship with US Bank, which manages our main operating account, and from strong relationships with PNC Global Transfer, Wells Fargo and Bank of America, which serve as our primary banks for exchange rate management with respect to the foreign currencies in which we transact.
In addition, we have benefited from our long relationship with US Bank, which manages our main operating account, and from strong relationships with Wells Fargo and Bank of America, which serve as our primary banks for exchange rate management with respect to the foreign currencies in which we transact.
We believe that there is significant room to grow our business in underserved geographic regions in the LAC corridor where there is demand from consumers and agents for our value-added approach to money remittances. Specifically, we are targeting future growth opportunities via new corridors from the United States to other non-Spanish speaking regions, including the Caribbean and other continents.
We believe that there is significant room to grow our business in underserved geographic regions in the LAC corridor where there is demand from consumers and agents for our value-added approach to money remittances. Specifically, we continue to target future growth opportunities via new corridors from the United States to other non-Spanish speaking regions, including the Caribbean and other continents.
In addition, each state of the United States from time to time, may enact new laws and regulations, such as the CCPA, which creates new consumer rights relating to the access to, deletion of, and sharing of personal information that is collected by businesses.
In addition, each state in the United States may from time to time, enact new laws and regulations, such as the CCPA and the CPA, which create new consumer rights relating to the access to, deletion of, and sharing of personal information that is collected by businesses.
Given the nature of our business, we are also subject to liquidity risk as the timing of the funds to be remitted by our sending agents may extend in comparison with the timing when we make the funds available to the money transfer beneficiary in the destination country.
Given the nature of our business, we are also subject to liquidity risk as the timing of the funds to be remitted by our sending agents or digital partners may extend in comparison with the timing when we make the funds available to the money transfer beneficiary in the destination country.
In 2024, we intend to continue to promote greater community involvement through philanthropic and volunteer efforts, with a focus on diversity, community improvement, and STEM programs. As of December 31, 2023, we had 534 employees in the United States, all of whom are full-time.
In 2025, we intend to continue to promote greater community involvement through philanthropic and volunteer efforts, with a focus on diversity, community improvement, and STEM programs. As of December 31, 2024, we had 523 employees in the United States, all of whom are full-time.
Through our online and electronic platforms, we also are exposed to credit risk directly from transactions that are originated through means other than cash, such as credit, debit cards and “ACH” transfers, and therefore are subject to “chargebacks” for insufficient funds or other collection impediments, such as fraud.
Through our online and digital platforms, we also are exposed to credit risk directly from transactions that are originated through means other than cash, such as credit and debit cards, and therefore are subject to “chargebacks” for insufficient funds or other collection impediments, such as fraud.
We are also subject to a wide range of regulations in the United States and other countries in which we operate, including: minimum capital or capital adequacy requirements; anti-money laundering laws and regulations; financial services regulations; currency control regulations; anti-bribery laws; money transfer and payment instrument licensing laws; escheatment laws; privacy, data protection and information security laws, such as the Gramm-Leach-Bliley Act (“GLBA”); and consumer disclosure and consumer protection laws, such as the California Consumer Privacy Act (“CCPA”).
We are also subject to a wide range of regulations in the United States and other countries in which we operate such as Spain and the United Kingdom, including: minimum capital or capital adequacy requirements; safeguarding of customers' funds; anti-money laundering laws and regulations; financial services regulations; currency control regulations; anti-bribery laws; money transfer and payment instrument licensing laws; escheatment laws; privacy, data protection and information security laws, such as the Gramm-Leach-Bliley Act (“GLBA”); and consumer disclosure and consumer protection laws, such as the California Consumer Privacy Act (“CCPA”) and the Colorado Privacy Act (“CPA”).
We benefit from our strong and long-term relationships with 5 Index a number of large banks and financial institutions. We maintain strong relationships with a number of other national and regional banking and financial institutions in the United States, Canada, Spain, Italy and Latin America.
We benefit from our strong and long-term relationships with a number of large banks and financial institutions. We maintain strong relationships with a number of other national and regional banking and financial institutions in the United States, Canada, Spain, Italy, Germany, the United Kingdom and Latin America.
Government Regulation As a non-bank financial institution in the United States, we are regulated by the Department of Treasury, the Internal Revenue Service, the U.S.
Government Regulation As a non-bank financial institution in the United States, we are regulated by the Internal Revenue Service, the U.S.
Risk Management The Company maintains certain of its cash balances in various U.S. banks, which at times, may exceed federally insured limits. In addition, the Company maintains various bank accounts in Mexico, Guatemala, Canada, the Dominican Republic, Spain and Italy, which may not be fully insured.
Risk Management The Company maintains certain of its cash balances in various U.S. banks, which at times, may exceed federally insured limits. In addition, the Company maintains various bank accounts in Mexico, Guatemala, Canada, the Dominican Republic, Spain, the United Kingdom, Germany and Italy, and short-term investments in Mexico, which may not be fully insured.
We believe we are a leading money remittance provider from the United States to the LAC corridor, processing 20.8% of the aggregate volume of remittances to Mexico according to the latest available data published by the Central Bank of Mexico in 2023 and 29.7% of the aggregate volume of remittances to Guatemala according to the latest available data published by the Central Bank of Guatemala in 2023.
We believe we are a leading money remittance provider from the United States to the LAC corridor, processing 19.7% of the aggregate volume of remittances to Mexico according to the latest available data published by the Central Bank of Mexico in 2024 and 27.6% of the aggregate volume of remittances to Guatemala according to the latest available data published by the Central Bank of Guatemala in 2024.
Information about our Executive Officers Set forth below is certain information regarding the Company’s current executive officers as of February 27 , 2023 : Name Age Position Robert Lisy 66 Chief Executive Officer, President and Chairman of the Board of Directors 10 Index Andras Bende 49 Chief Financial Officer Joseph Aguilar 62 President and General Manager - Latin America Christopher Hunt 48 Chief Operating Officer Robert Lisy has served as a director of International Money Express, Inc. since 2018.
Information about our Executive Officers Set forth below is certain information regarding the Company’s current executive officers as of February 27, 2025: Name Age Position Robert Lisy 67 Chief Executive Officer, President and Chairman of the Board of Directors Andras Bende 50 Chief Financial Officer Joseph Aguilar 63 President and General Manager - Latin America Christopher Hunt 49 Chief Operating Officer Robert Pargac 58 Chief Legal Officer and Secretary Robert Lisy has served as a director of International Money Express, Inc. since 2018.
Our money remittance platforms currently enable consumers to send funds from the United States, Spain, Italy and Germany to the LAC corridor, Asia and Africa through the Internet via Intermexonline.com, online.i-transfer.es and on consumers' Internet-enabled mobile devices.
Our money remittance platforms currently enable consumers to send funds from the United States, Spain, Italy, the United Kingdom and Germany to the LAC corridor, Europe, Asia and Africa through the Internet via our websites (intermexonline.com and online.i-transfer.es) and mobile device applications.
In addition to our proprietary and internally developed software systems, we have analytical data that enable us to analyze market trends, performance of market territories, agent performance and consumer habits in real time. We continually invest in our technology platform that has the capacity to handle traffic well in excess of the number of transactions we currently process.
In addition to our proprietary and internally developed software systems, we utilize historical and predictive data to analyze market trends, performance of market territories, agent performance and consumer habits in real time. We continually invest in our technology platforms to ensure they have the capacity to handle traffic well in excess of the number of transactions we currently process.
In all of our independent sending agent 6 Index locations the agent provides the physical infrastructure and staff required to complete the remittances, while we provide the central operating functions, such as transaction processing, settlement, marketing support, compliance training and support, and customer relationship management. We also maintain 122 Company-operated stores in the United States, Canada, Spain, Italy and Germany.
In all of our independent sending agent locations the agent provides the physical infrastructure and staff required to complete the remittances, while we provide the central operating functions, such as transaction processing, settlement, marketing support, compliance training and support, and customer relationship management.
In addition, under the Dodd-Frank Act, it is unlawful for any provider of consumer financial products or services to engage in unfair, deceptive, or abusive acts or practices. The CFPB has substantial rule making and enforcement authority to prevent unfair, deceptive, or abusive acts or practices in connection with any transaction with a consumer for a financial product or service.
The CFPB has substantial rule making and enforcement authority to prevent unfair, deceptive, or abusive acts or practices in connection with any transaction with a consumer for a financial product or service.
Unlike many of our competitors, who we believe prioritize global reach over growth and profitability, we are focused on certain geographical regions in which there is a concentration of a significant portion of the world’s money remittance volume. We believe the LAC, Africa and Asia corridors provide an attractive operating environment with significant opportunity for future growth.
Our Competitive Strengths • Primary focus on profitable corridors. Unlike many of our competitors, who we believe prioritize global reach over growth and profitability, we are focused on certain geographical regions in which there is a concentration of a significant portion of the world’s money remittance volume.
We also have 698 employees in Mexico, of whom 261 are part-time and 427 are full-time, 79 employees in Guatemala, all of whom are full-time and, 76 employees in Spain and Italy, of whom 70 are full-time. In addition, five of the nine members of our board of directors are considered diverse based on gender or ethnic backgrounds.
We also have 529 employees in Mexico, of whom 189 are part-time and 340 are full-time, 159 employees in Guatemala, all of whom are full-time and, 92 employees in Spain, Italy, Germany and the United Kingdom, of whom 79 are full-time and 13 are part-time. 10 Index In addition, five of the eight members of our board of directors are considered diverse based on gender or ethnic backgrounds.
We aim to continue to expand our market share in those states where we are currently well-established and poised for continued profitable growth within those markets via targeted regional penetration.
According to the latest available data in the World Bank Remittance Matrix, the United States to Mexico remittance market continues to be one of the largest in the world. We aim to continue to expand our market share in those states where we are currently well-established and poised for continued profitable growth within those markets via targeted regional penetration.
We strategically target sending agents for our network only after a metric-based analysis of potential productivity and a thorough vetting process. In our sending agent selection process, we focus on geographic locations that we believe are likely to have high customer volume and demand for our 3 Index services.
In our sending agent 3 Index selection process, we focus on geographic locations that we believe are likely to have high customer volume and demand for our services.
We value diversity and inclusion and strive to create a work environment where everyone feels valued and devoted to their work. As of December 31, 2023, approximately 95% of our U.S. team members identified themselves as racially or ethnically diverse. Also, approximately 60% of our U.S. team identified themselves as female.
We value opportunity, fairness and merit, and strive to create a work environment where all of our employees feel valued and devoted to their careers. As of December 31, 2024, approximately 94% of our U.S. team members identified themselves as racially or ethnically diverse. Also, approximately 5 0% of our U.S. team identified themselves as female.
We retain customer data, which enables us to increase repeat customer usage, track and effectively recapture one-time users of our service and improve sending agent productivity.
We also maintain 117 Company-operated stores in the United States, Canada, Spain, Italy, the United Kingdom and Germany. We retain customer data, which enables us to increase repeat customer usage, track and effectively recapture one-time users of our service and improve sending agent productivity.
Our money processing software is critical to our operations while our back-office software is critical for settling our transactions. Also, our money remittance platforms enable consumers to send funds through the Internet via Intermexonline.com, online.i-transfer.es and on consumers' Internet-enabled mobile devices and our enhanced digital mobile money remittance application provides consumers with safe, easy-to-use features for remitting funds.
Also, our money remittance platforms enable consumers to send funds through the Internet via our websites (intermexonline.com and online.i-transfer.es) and mobile device applications from consumers' computers or mobile devices. Our enhanced digital mobile money remittance applications provide consumers with safe and easy-to-use features for remitting funds.
In recent years, we expanded our services to allow remittances to Africa and Asia from the United States and also began offering sending services from Canada to Latin America and Africa.
In recent years, we expanded our services to allow remittances to Africa and Asia from the United States, began offering sending services from Canada to Latin America and Africa, and 4 Index completed acquisitions which further strengthen our presence in Latin America and position us to grow in the Europe to Africa, Asia and LAC corridors.
We have taken the necessary steps to review, modify and implement, as needed, policies and procedures designed to comply with the CFPB’s Remittance Transfer Rule. The Company’s communications, advertising and sales practices and that of its agent network are subject to regulation by, among other things, state and federal consumer protection laws including the Telephone Consumer Protection Act (“TCPA”).
The Company’s communications, advertising and sales practices and that of its agent network are subject to regulation by, among other things, state and federal consumer protection laws including the Telephone Consumer Protection Act (“TCPA”).
We hold promotional events for our sending agents to help familiarize them with the Intermex brand and to incentivize the agents to promote our services to consumers. Our money remittance services are also available on the Internet via Intermexonline.com and online.i-transfer.es, enabling consumers to send money twenty-four hours a day conveniently from their computer or Internet-enabled mobile device.
Our money remittance services are also available on the Internet via our websites (intermexonline.com and online.i-transfer.es) and mobile device applications, enabling consumers to send money conveniently 24 hours a day from their computer or mobile devices.
According to the latest available data published by the World Bank, the LAC corridor continues to be one of the most rapidly growing remittance corridors in the world. • Highly scalable, proprietary software platform.
We believe the LAC, Africa and Asia corridors provide an attractive operating environment with significant opportunity for future growth. According to the latest available data published by the World Bank, the LAC corridor continues to be one of the most rapidly growing remittance corridors in the world. • Highly scalable, proprietary software platforms.
We provide our money remittance services utilizing our internally developed proprietary software systems and applications, which we believe enhance the productivity of our network of sending agents, enabling them to quickly, reliably and cost-effectively process remittance transactions. Our proprietary software systems were designed to incorporate real-time compliance functionality, which improves our regulatory compliance and helps to minimize fraud.
We provide our money remittance services utilizing our internally developed proprietary software systems, which we believe enhance the productivity of our network of sending agents, enabling them to quickly, reliably and cost-effectively process remittance transactions. Also, our proprietary applications enable our consumers to rapidly process money transmissions through a variety of digital channel offerings.
As a MSB, we and our agents are required to establish anti-money laundering compliance programs that include internal policies and controls; a designated compliance officer; employee training and an independent review function. We have developed an anti-money laundering training manual and a program to assist with the education of our agents and employees on the applicable rules and regulations.
We have developed an anti-money laundering training manual and a program to assist with the education of our agents and employees on the applicable rules and regulations.
Management believes it is not exposed to any significant credit risk regarding these accounts as it performs periodic reviews of the creditworthiness of the financial institutions the Company uses. At times, we are exposed to credit risk related to receivable balances from sending agents in the money remittance process if agents do not timely make payments to us.
Management believes it is not exposed to any significant credit risk regarding these accounts as it performs periodic reviews of the creditworthiness of the financial institutions the Company uses.
Remittances paid in local currencies that are not pegged to the U.S. dollar, Canadian dollar or Euro also earn revenue through our daily management of currency exchange spreads. The majority of our money remittance transactions are generated through our agent network of retail locations and Company-operated stores where the transaction is processed and payment is collected by our sending agent.
Remittances paid in local currencies that are not pegged to the U.S. dollar, Canadian dollar, Euro or British pound also earn revenue through our daily management of currency exchange spreads.
In addition, our services are offered digitally through Intermexonline.com, online.i-transfer.es and via Internet-enabled mobile devices. For the year ended December 31, 2023, we grew our agent network by approximately 16.4% primarily due to agents added as a result of the acquisition of LAN Holdings, partially offset by the termination of low volume and unproductive sending agents.
In addition, our services are offered digitally through intermexonline.com, online.i-transfer.es and via Internet-enabled mobile devices. For the year ended December 31, 2024, our agent network decreased slightly by approximately 0.2% primarily as a result of a lower number of agents onboarded during the period relative to ordinary course agent terminations.
We market our services to consumers in a number of ways, directly and indirectly through our sending agents and paying agents, promotional activities, traditional media and digital advertising, and our loyalty program, which we call “Interpuntos”.
We market our services to consumers in a number of ways, including directly and indirectly through our sending agents and paying agents, promotional activities, traditional media and digital advertising. Our Industry We are a leading money remittance service company primarily focused on the United States to the LAC corridor.
Anti-money laundering regulations are constantly evolving and vary from country to country. We continuously monitor our compliance with anti-money laundering regulations and implement policies and procedures to stay current with legal requirements. Our money remittance services are primarily offered through third-party agents under contract with us, but we do not directly control these agents.
Anti-money laundering regulations are constantly evolving and vary from country to country. We continuously monitor our compliance with anti-money laundering regulations and implement policies and procedures to stay current with legal requirements in the jurisdictions in which we operate.
Information Technology Currently, all of our money processing software used in the United States and Canada is proprietary and has been developed primarily by our internal software development team. Our money processing software acts as a point of sale for our money remittance transactions and incorporates real-time compliance functionality, which improves our regulatory compliance and helps to minimize fraud.
Information Technology Currently, all of our money processing software used in the United States, United Kingdom, Spain, Italy, Germany and Canada is proprietary and has been developed primarily by our internal software development team.
(“LAN Holdings”), which was completed in the second quarter of 2023, we now provide remittance services from Spain, Italy and Germany to Africa, Asia and Latin America. We utilize our proprietary technology to deliver convenient, reliable and value-added services to consumers through a broad network of sending and paying agents.
We utilize our proprietary technology to deliver convenient, reliable and value-added services to consumers through a broad network of sending and paying agents.
Our current liquidity sources as well as our ability to generate free cash are mitigating factors in our liquidity management strategy. Our indebtedness bears interest at variable rates, which exposes us to interest rate risk as a result of fluctuations on market interest rate benchmarks. Seasonality 9 Index We do not experience meaningful seasonality in our business.
We manage our currency exposure primarily by settling with our payers using foreign exchange tom and spot transactions. Our indebtedness bears interest at variable rates, which exposes us to interest rate risk as a result of fluctuations on market interest rate benchmarks. Seasonality We do not experience meaningful seasonality in our business.
We have developed a platform that has the capacity to handle traffic well in excess of the number of transactions we currently process. Our money remittance platform has proven reliable, with our 2023 downtime being less than 0.05%. • Highly selective sending agent recruitment process designed to identify productive long-term partners.
Our money remittance platforms have proven reliable, with our 2024 downtime being less than 0.05 %. • Highly selective sending agent recruitment process designed to identify productive long-term partners. We strategically target sending agents for our network only after a metric-based analysis of potential productivity and a thorough vetting process.
In addition to our money remittance software, digital platforms and mobile applications, we continue to develop programs and defenses against cyber-attacks. We are fully aligned with the National Institute of Standards and Technology cybersecurity framework, which is a voluntary framework that most companies in the financial services industry follow.
In addition to our money remittance software, digital platforms and mobile applications, we continue to develop programs and defenses against cyber-attacks. The foundation of our cybersecurity program is based on recognized best practices and standards for cybersecurity and information technology that include the Center of Internet Security ("CIS") Critical Security Controls Framework.
In recent years, we expanded our services to allow remittances to Africa and Asia from the United States and also began offering sending services from Canada to Latin America and Africa. Also, through the acquisition of LAN Holdings, Corp.
We also provide our remittance services to Africa and Asia from the United States and offer sending services from Canada to Latin America and Africa. Also, through recent acquisitions we now provide remittance services from Spain, Italy, the United Kingdom and Germany to Africa, Asia and Latin America.
As a “larger participant” in the market for international money transfers, we are subject to direct examination and supervision by the CFPB. We have modified our systems and consumer disclosures in light of the requirements of the Remittance Transfer Rule.
As a “larger participant” in the market for international money transfers, we are subject to direct examination and supervision by the CFPB. In addition, under the Dodd-Frank Act, it is unlawful for any provider of consumer financial products or services to engage in unfair, deceptive, or abusive acts or practices.
For the year ended December 31, 2023, principal amount sent increased by approximately 17.2% to $24.5 billion compared to fiscal year 2022 primarily as a result of an increase in volume in our existing sending agents.
For the year ended December 31, 2024, principal amount sent decreased slightly by approximately 0.8% to $24.4 billion, as compared to fiscal year 2023, primarily as a result of a lower principal amount sent per transaction, Total remittances processed were approximately 58.9 million, representing a slight increase of approximately 0.4%, as compared to fiscal year 2023 primarily related to increased volume generated by our digital channels and European subsidiaries.
We utilize a number of third-party vendors that monitor our systems and inform us of any attempted attacks. Our Chief Information Officer and Chief Information Security Officer report periodically to our board of directors regarding our cybersecurity policies and practices.
Our Chief Information Officer and Chief Information Security Officer report periodically to our board of directors regarding our cybersecurity policies and practices. See Item 1C - Cybersecurity for additional detail.
We continually monitor fraud risk, perform credit reviews before adding agents to our network and conduct periodic credit risk analyses of agents and certain other parties that we transact with directly. For the year ended December 31, 2023, our provision for credit losses was equal to 0.8% of our total revenues.
At times, we are exposed to credit risk related to receivable balances from sending agents and digital partners in the money remittance process if agents or digital partners do not timely make payments to us. 9 Index We continually monitor fraud risk, perform credit reviews before adding agents to our network and conduct periodic credit risk analyses of agents and certain other parties that we transact with directly.
Those funds become available for pickup by the beneficiary at the designated receiving destination, usually within minutes, at any Intermex payer location. In select countries, the designated recipient may also receive the remitted funds via a deposit directly to the recipient’s bank account, mobile device account or prepaid card.
In select countries, the designated recipient may also receive the remitted funds via a deposit directly to the recipient’s bank account, debit cards, mobile wallets, and home delivery in selected markets.
Our Growth Strategy We believe we are well positioned to drive continued growth by executing on the following core strategies either organically or through acquisitions of other entities: • Expand our market share in our largest corridors .
Our Growth Strategy On February 26, 2025, we announced that, with the approval and recommendation of the Board’s independent Strategic Alternatives Committee (“SAC”), the Board unanimously determined to suspend the Company’s previously announced assessment of strategic alternatives, We believe, however, that we are well positioned to drive continued growth and stockholder value maximization by executing on the following core strategies either organically or through acquisitions of other entities: • Invest in the marketing and adoption of our digital channels and value-added services to expand our customer base and revenue generation.
The three largest remittance corridors we serve are the United States to Mexico, United States to Guatemala and United States to the Dominican Republic. According to the latest available data in the World Bank Remittance Matrix, the United States to Mexico remittance market continues to be one of the largest in the world.
Our digital channels offering also generates growth from various demographic groups as consumers continue to migrate to conducting financial transactions digitally. • Expand our market share in our largest corridors . The three largest remittance corridors we serve are the United States to Mexico, United States to Guatemala and United States to the Dominican Republic.
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In 2023, we processed approximately 58.7 million remittances, representing over 22.8% growth in transactions as compared to 2022, also reflecting the effect of the acquisitions noted above. Our Competitive Strengths • Primary focus on profitable corridors.
Added
We also generate revenue from our wire as a service relationships with digital partners where we receive a fee for facilitating money transfers processed through our proprietary software systems, using our money transmitter licenses and payer network relationships.
Removed
Our acquisition of La Nacional further strengthens our presence in Latin America and our acquisition of LAN Holdings positions us to grow in the Europe to Africa and Asia corridors. • Continue to grow online and mobile remittance channels.
Added
Our proprietary software systems are designed to incorporate real-time compliance functionality, which improves our regulatory compliance and helps to minimize fraud. Our d eveloped platforms have the ability to handle traffic well in excess of the number of transactions we currently process.
Removed
We have and continue to make significant investments in enhancing our digital mobile money remittance applications to provide consumers with safe, easy-to-use features for remitting funds.
Added
We intend to increase the level of investment in enhancing and marketing our digital applications to increase consumer adoption of our safe, easy-to-use digital platforms for remitting funds and performing other financial services. We believe these digital channels expand our potential customer base as digital transaction capabilities have become more relevant to consumers in the LAC and other corridors.
Removed
Those funds can be sent to any of our paying agent locations or to a recipient’s bank account, funding the transaction using debit card, credit card, or through electronic funds transfer processed through the automated clearing house (“ACH”) payment system.
Added
We also generate revenue from our “wire as a service” relationships with digital partners where we receive a fee for facilitating money transfers processed through our proprietary software systems, money transmitter licenses and payer network relationships.
Removed
Although our internet-based money transmission services grew significantly in 2023, they still do not constitute a material percentage of the Company’s overall business.
Added
The majority of our money remittance transactions are generated through our agent network of retail locations and Company-operated stores where the transaction is processed and payment is collected by our sending agent. Those funds become available for pickup by the beneficiary at the designated receiving destination, usually within minutes, at any Intermex payer location.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur inability to protect our systems and data from these and similar risks could, among other consequences, adversely affect our reputation, business, financial condition, and results of operations. Our business is particularly dependent on the efficient and uninterrupted operation of our information technology, computer network systems, and data centers.
Biggest changeOur business is particularly dependent on the efficient and uninterrupted operation of our information technology, computer network systems, and data centers. Disruptions to these systems and data centers could adversely affect our business, financial condition and results of operations.
ITEM 1A. RISK FACTORS RISK FACTORS An investment in our securities involves certain risks. The risks and uncertainties described below are not the only risks that may have a material and adverse effect on the Company, and the risks described herein are not listed in order of the potential occurrence or severity.
ITEM 1A. RISK FACTORS An investment in our securities involves certain risks. The risks and uncertainties described below are not the only risks that may have a material and adverse effect on the Company, and the risks described herein are not listed in order of the potential occurrence or severity.
These factors include: • the quality of our services and our customer experience, and our ability to meet evolving consumer needs and preferences; • failure of our agents to deliver services in accordance with our requirements; • reputational concerns resulting from actual or perceived events, including those related to fraud, consumer protection, cybersecurity incidents, money laundering, corruption or other matters; • changes or proposed changes in laws or regulations, or regulator or judicial interpretation thereof, that have the effect of making it more difficult or less desirable to transfer money using consumer money remittance service providers, including additional customer due diligence, identification, reporting, and recordkeeping requirements; • actions by federal, state or foreign regulators that interfere with our ability to remit consumers’ money reliably; for example, attempts to seize money remittance funds, imposition of tariffs or limits on our ability to, or that prohibit us from, remitting money in the corridors in which we operate; • federal, state or foreign legal requirements, including those that require us to provide consumer or transaction data, and other requirements or to a greater extent than is currently required; • any interruption or downtime in our systems, including those caused by fire, natural disaster, power loss, telecommunications failure, terrorism, vendor failure, cybersecurity breaches, such as unauthorized entry and computer viruses or disruptions in our workforce; and 14 Index • any attack or breach of our computer systems or other data storage facilities resulting in a compromise of personal data.
These factors include: • the quality of our services and our customer experience, and our ability to meet evolving consumer needs and preferences; • failure of our agents to deliver services in accordance with our requirements; • reputational concerns resulting from actual or perceived events, including those related to fraud, consumer protection, cybersecurity incidents, money laundering, corruption or other matters; • changes or proposed changes in laws or regulations, or regulator or judicial interpretation thereof, that have the effect of making it more difficult or less desirable to transfer money using consumer money remittance service providers, including additional customer due diligence, identification, reporting, and recordkeeping requirements; • actions by federal, state or foreign regulators that interfere with our ability to remit consumers’ money reliably; for example, attempts to seize money remittance funds, imposition of tariffs or limits on our ability to, or that prohibit us from, remitting money in the corridors in which we operate; • federal, state or foreign legal requirements, including those that require us to provide consumer or transaction data, and other requirements or to a greater extent than is currently required; • any interruption or downtime in our systems, including those caused by fire, natural disaster, power loss, telecommunications failure, terrorism, vendor failure, cybersecurity breaches, such as unauthorized entry and computer viruses or disruptions in our workforce; and • any attack or breach of our computer systems or other data storage facilities resulting in a compromise of personal data.
Acquisitions often involve additional or increased risks including, for example: • managing the complex process of integrating the acquired company’s employees, products and services, technology and other assets in an effort to realize the projected value of the acquired company and the projected synergies of the acquisition; • realizing the anticipated financial benefits from these acquisitions and where necessary, improving controls of these acquired businesses (including internal control over financial reporting and disclosure controls and procedures); • retaining existing customers and attracting new customers; • maintaining good relations with agents of acquired companies; • managing geographically separated organizations, systems and facilities; • managing multi-jurisdictional operating, tax and financing structures or any inefficiencies; • integrating personnel with diverse business backgrounds and organizational cultures; 15 Index • integrating the acquired systems and technologies into our Company; • complying with regulatory requirements, including those particular to the industry and jurisdiction of the acquired business, and the need to improve regulatory compliance systems and controls; • obtaining and enforcing intellectual property rights in some foreign countries; • entering new markets with the services of the acquired businesses; and • general economic, social and political conditions, including legal and other barriers to cross-border investment in general, or by United States companies in particular.
Acquisitions often involve additional or increased risks including, for example: • managing the complex process of integrating the acquired company’s employees, products and services, technology and other assets in an effort to realize the projected value of the acquired company and the projected synergies of the acquisition; • realizing the anticipated financial benefits from these acquisitions and where necessary, improving controls of these acquired businesses (including internal control over financial reporting and disclosure controls and procedures); • retaining existing customers and attracting new customers; • maintaining good relations with agents of acquired companies; • managing geographically separated organizations, systems and facilities; • managing multi-jurisdictional operating, tax and financing structures or any inefficiencies; • integrating personnel with diverse business backgrounds and organizational cultures; • integrating the acquired systems and technologies into our Company; • complying with regulatory requirements, including those particular to the industry and jurisdiction of the acquired business, and the need to improve regulatory compliance systems and controls; • obtaining and enforcing intellectual property rights in some foreign countries; • entering new markets with the services of the acquired businesses; and • general economic, social and political conditions, including legal and other barriers to cross-border investment in general, or by United States companies in particular.
Further, we do not control the actions or technological environments of our agents and they may be susceptible to similar threats as previously mentioned which could lead to liability claims against the Company. Although agents have experienced security breaches, in the aggregate, none of these breaches has had a significant or material impact to the Company.
Further, we do not control the actions or technological environments of our agents and they may be susceptible to similar threats as previously mentioned which could lead to liability claims against the Company. Although agents have experienced security breaches, in the aggregate, none of these breaches have had a significant or material impact to the Company.
If general market and economic conditions in the United States or other countries in which we operate or are important to our business were to deteriorate, our business, financial condition and results of operations could be adversely impacted. Our agents may have reduced sales or business as a result of weak economic conditions.
If general market and economic conditions in the United States or other countries in which we operate and that are important to our business were to deteriorate, our business, financial condition and results of operations could be adversely impacted. Our agents may have reduced sales or business as a result of weak economic conditions.
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, among other consequences, substantial civil and criminal penalties, including fines, incarceration, prohibitions or limitations on the conduct of our business, the loss of our financing facilities and significant reputational damage, any of which could have a material and adverse effect on our results of business, financial condition or results of operations.
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, among other consequences, substantial civil and criminal penalties, including fines, 23 Index incarceration, prohibitions or limitations on the conduct of our business, the loss of our financing facilities and significant reputational damage, any of which could have a material and adverse effect on our results of business, financial condition or results of operations.
Although expansion of our business into new geographic or product markets may increase our aggregate revenues, such new geographic or product markets may be more expensive to operate in and may require us to receive lower payment per wire or remittance than that which we currently experience in our core geographic markets of Mexico, Guatemala, El Salvador, Honduras and the Dominican Republic or other more established product markets due to, among other things: • increased compliance and regulatory costs requiring us to dedicate more expense, time and resources to comply with such regulatory requirements; • potentially higher operational expenses, such as higher agent fees, taxes, fees, technology costs, support costs or other charges and expenses associated with engaging in the money transfer business in different jurisdictions or as a result of new product offerings; • reduced pricing models due to more intense competition with entities that may have more experience and resources as well as more established relationships with relevant customers, regulators and industry participants; • potentially reduced demand for remittance services; and • difficulty building and maintaining a network of sending and paying agents in a particular geographic area or with respect to a particular product offering.
Although expansion of our business into new geographic or product markets may increase our aggregate revenues, such new geographic or product markets may be more expensive to operate in and may require us to receive lower payment per wire or remittance than that which we currently experience in our core geographic markets of Mexico, Guatemala, El Salvador, Honduras and the Dominican Republic or other more established product markets due to, among other things: • increased compliance and regulatory costs requiring us to dedicate more expense, time and resources to comply with such regulatory requirements; • potentially higher operational expenses, such as higher agent fees, taxes, fees, technology costs, support costs or other charges and expenses associated with engaging in the money transfer business in different jurisdictions or as a result of new product offerings; • reduced pricing models due to more intense competition with entities that may have more experience and resources as well as more established relationships with relevant customers, regulators and industry participants; • potentially reduced demand for remittance services; and 16 Index • difficulty building and maintaining a network of sending agents, paying agents, and digital partners in a particular geographic area or with respect to a particular product offering.
An interruption of our access to capital could impair our ability to conduct business if our regulatory capital falls below requirements. Our Amended and Restated Credit Agreement contains covenants that may limit our ability to conduct business.
An interruption of our access to capital could impair our ability to conduct business if our regulatory capital falls below requirements. Our Second Amended and Restated Credit Agreement contains covenants that may limit our ability to conduct business.
If no or few securities or industry analysts cover the Company, our stock price would likely be less than that which we would obtain if we had such coverage and the liquidity, or trading volume of our common stock may be limited, making it more difficult for a stockholder to sell shares at an acceptable price or amount.
If no or few securities or industry analysts cover the Company, our stock 25 Index price would likely be less than that which we would obtain if we had such coverage and the liquidity, or trading volume of our common stock may be limited, making it more difficult for a stockholder to sell shares at an acceptable price or amount.
We have implemented, and are continuing to implement, policies, procedures and systems designed to address these laws and regulations, including monitoring on an automated and manual basis, the transactions processed through our systems and restricting business involving certain countries or individuals. However, the implementation of such policies, procedures and systems may be subject to human error.
We have implemented, and are continuing to implement, policies, procedures and systems designed to address these laws and regulations, including 17 Index monitoring on an automated and manual basis the transactions processed through our systems and restricting business involving certain countries or individuals. However, the implementation of such policies, procedures and systems may be subject to human error.
We compete in a concentrated industry, with a small number of large competitors and a large number of small, niche competitors, including consumer money remittance companies, banks, card associations, web-based services, payment processors, informal remittance systems and others. We also face competition from new digital and nontraditional remittance service providers within the financial technology industry.
We compete in a concentrated industry, with a small number of large competitors and a large number of small, niche competitors, including consumer money remittance companies, banks, card associations, web-based services, payment processors, informal remittance systems 13 Index and others. We also face competition from new digital and nontraditional remittance service providers within the financial technology industry.
Conversely, if widely varying regulations come into existence worldwide, we may have difficulty adjusting our services, fees, foreign exchange spreads and other important aspects of our business, with the same effect. 20 Index Current and future data privacy and cybersecurity laws and regulations could adversely affect our business, financial condition, and results of operations.
Conversely, if widely varying regulations come into existence worldwide, we may have difficulty adjusting our services, fees, foreign exchange spreads and other important aspects of our business, with the same effect. Current and future data privacy and cybersecurity laws and regulations could adversely affect our business, financial condition, and results of operations.
The legislation and implementation of regulations associated with the Dodd-Frank Act have increased our costs of compliance and required changes in the way we and our agents conduct business. In addition, we are subject to periodic examination by the CFPB. These examinations may require us to change the way we conduct business or increase the costs of compliance.
The legislation and implementation of regulations associated with the Dodd-Frank Act have increased our costs of compliance and required changes in the way we and our agents conduct business. In addition, we are subject to 21 Index periodic examination by the CFPB. These examinations may require us to change the way we conduct business or increase the costs of compliance.
In those markets where we have applied for trademark registrations, failure to secure those registrations could adversely 22 Index affect our ability to enforce and defend our trademark rights. Our business would be harmed if we were unable to adequately protect our brands and the value of our brands was to decrease as a result.
In those markets where we have applied for trademark registrations, failure to secure those registrations could adversely affect our ability to enforce and defend our trademark rights. Our business would be harmed if we were unable to adequately protect our brands and the value of our brands was to decrease as a result.
Our ability to grow in international markets and our future results could be adversely affected by a number of factors, including: • changes in geopolitical and economic conditions and potential instability in certain regions; • restrictions on money transfers to, from and between certain countries; • inability to recruit and retain paying agents and consumers for new corridors; • currency exchange controls, new currency adoptions and repatriation issues; • changes in regulatory requirements or in foreign policy, including the adoption of domestic or foreign laws, regulations and interpretations detrimental to our business; • possible increased costs and additional regulatory burdens imposed on our business; • the implementation of U.S. sanctions, resulting in bank closures in certain countries and the ultimate freezing of our assets; • burdens of complying with a wide variety of laws and regulations; 13 Index • possible fraud or theft losses, and lack of compliance by international representatives in foreign legal jurisdictions where collection and legal enforcement may be difficult or costly; • inability to maintain or improve our software and technology systems; • reduced protection of our intellectual property rights; • unfavorable tax rules or trade barriers; and • inability to secure, train or monitor international agents.
Our ability to grow in international markets and our future results could be adversely affected by a number of factors, including: • changes in geopolitical and economic conditions and potential instability in certain regions; • restrictions on money transfers to, from and between certain countries; • inability to recruit and retain paying agents and consumers for new corridors; • currency exchange controls, new currency adoptions and repatriation issues; • changes in regulatory requirements or in foreign policy, including the adoption of domestic or foreign laws, regulations and interpretations detrimental to our business; • possible increased costs and additional regulatory burdens imposed on our business; • the implementation of U.S. sanctions, resulting in bank closures in certain countries and the ultimate freezing of our assets; • burdens of complying with a wide variety of laws and regulations; • possible fraud or theft losses, and lack of compliance by international representatives in foreign legal jurisdictions where collection and legal enforcement may be difficult or costly; • inability to maintain or improve our software and technology systems as well as digital channels; • reduced protection of our intellectual property rights; • unfavorable tax rules or trade barriers; and • inability to secure, train or monitor international agents.
Should our existing relationship banks decide to not offer depository services to companies engaged in processing money remittance transactions, or to retail 18 Index agents that collect and remit cash from end consumers, our ability to complete money remittances, and to administer and collect fees from money remittance transactions, could be adversely affected.
Should our existing relationship banks decide to not offer depository services to companies engaged in processing money remittance transactions, or to retail agents that collect and remit cash from end consumers, our ability to complete money remittances, and to administer and collect fees from money remittance transactions, could be adversely affected.
Changes in the laws affecting the kinds of entities that are permitted to act as money remittance agents (such as changes in requirements for capitalization or ownership) could adversely affect our ability to distribute our services and the cost of providing such services. Many of our sending agents are in the check cashing industry.
Changes in the laws affecting the kinds of entities that are permitted to act as money remittance agents (such as changes in requirements for capitalization or ownership) could adversely affect our ability to distribute our services and the cost of providing such services. Many of our sending agents in the United States are in the check cashing industry.
We also may be required to seek a license to continue to use the processes or systems. Such a license may require either a single payment or an ongoing license fee. No assurance can be given that we will be able to obtain a license which is reasonable in fee and scope.
We also may be required to seek a license to continue to use the processes or systems. Such a license may require either a single payment or an ongoing license fee. No 24 Index assurance can be given that we will be able to obtain a license which is reasonable in fee and scope.
Elektra, our largest paying agent by volume, accounted for approximately 25% of Intermex’s total remittance volume in fiscal year 2023. The loss of Elektra as one of our paying agents could have a material adverse impact on our business and results of operations.
Elektra, our largest paying agent by volume, accounted for approximately 25% of Intermex’s total remittance volume in fiscal year 2024. The loss of Elektra as one of our paying agents could have a material adverse impact on our business and results of operations.
Additionally, consumers tend to be employed in industries such as construction, information technology, manufacturing, agriculture, hospitality and certain service industries that tend to be cyclical and are more significantly affected by weak 12 Index economic conditions than other industries.
Additionally, consumers tend to be employed in industries such as construction, information technology, manufacturing, agriculture, hospitality and certain service industries that tend to be cyclical and are more significantly affected by weak economic conditions than other industries.
While we maintain insurance coverage that may cover certain aspects of cyber risks and incidents, our insurance coverage may be insufficient to cover all losses, and we may not be able to renew the insurance on commercially reasonable terms or at all.
While we maintain insurance coverage that may cover certain aspects of cyber risks 18 Index and incidents, our insurance coverage may be insufficient to cover all losses, and we may not be able to renew the insurance on commercially reasonable terms or at all.
In addition, our ability to continue to provide our services to a growing number of agents and consumers in a growing number of countries, as well as to enhance our existing services and offer new services across new distribution platforms, is dependent on our information technology systems.
In addition, our ability to continue to provide our services to a growing number of agents, digital partners and consumers in a growing number of countries, as well as to enhance our existing services and offer new services across new distribution platforms, is dependent on our information technology systems.
We also face risk from our third-party suppliers if they are affected by cyber security incidents, which could result in their loss of service (which could be a significant component of our services to agents and consumers), exposure of Intermex proprietary, agent and consumer data, or a potential backdoor into the Company’s systems and networks.
We also face risk from our third-party suppliers if they are affected by cybersecurity incidents, which could result in their loss of service (which could be a significant component of our services to agents and consumers), exposure of Intermex proprietary, agent and consumer data, or a potential backdoor into the Company’s systems and networks.
We face credit risks from our sending agents and financial institutions with which we do business. The majority of our business is conducted through independent sending agents that provide our services to consumers at their business locations.
We face credit risks from our sending agents, digital partners and financial institutions with which we do business. The majority of our business is conducted through independent sending agents that provide our services to consumers at their business locations.
Our indebtedness, which bears interest at variable rates, could have important consequences to our business and operations, including, but not limited to: • increasing our vulnerability to, and reducing our flexibility to respond to, general adverse economic and industry conditions; • requiring the dedication of a substantial portion of our cash flow from operations to servicing debt, including from increased interest rates; • limiting our flexibility in planning for, or reacting to, changes in our business and the competitive environment; and • limiting our ability to borrow additional funds and increasing the cost of any such borrowing.
Our indebtedness, which bears interest at variable rates, could have important consequences to our business and operations, including, but not limited to: (i) increasing our vulnerability to, and reducing our flexibility to respond to, general adverse economic and industry conditions; (ii) requiring the dedication of a substantial portion of our cash flow from operations to servicing debt, including from increased interest rates; (iii) limiting our flexibility in planning for, or reacting to, changes in our business and the competitive environment; and (iv) limiting our ability to borrow additional funds and increasing the cost of any such borrowing.
As we make more of our services available online and via Internet-enabled mobile devices, we subject ourselves to new types of consumer fraud risk because requirements relating to consumer authentication are more complex with internet services and such other technologies. Additionally, it is possible that our agents could engage in fraud against consumers.
As we make more of our services available online and via Internet-enabled mobile devices, we subject ourselves to new types of consumer fraud risk because requirements relating to consumer authentication are more complex with Internet services and such other technologies. Additionally, it is possible that our agents or digital partners could engage in fraud against consumers.
Further, we may be exposed to fraud or other misconduct committed by our employees, or other third parties, including but not limited to consumers and agents, or other events that are out of our control.
Further, we may be exposed to fraud or other misconduct committed by our employees, or other third parties, including but not limited to consumers, agents and digital partners, or other events that are out of our control.
As the number of jurisdictions enacting privacy and related laws increases and the scope of these laws and enforcement efforts expands, we will increasingly become subject to new and varying requirements. For example, the CCPA requires covered companies to provide California consumers with new disclosures and expands the rights afforded to consumers regarding their data.
As the number of jurisdictions enacting privacy and related laws increases and the scope of these laws and enforcement efforts expands, we have been and will increasingly become, subject to new and varying requirements. For example, the CCPA requires covered companies to provide California consumers with certain disclosures and expands the rights afforded to consumers regarding their data.
We monitor the creditworthiness of our sending agents and the financial institutions with which we do business on an ongoing basis.
We monitor the creditworthiness of our sending agents, digital partners and the financial institutions with which we do business on an ongoing basis.
Additionally, 19 Index we are subject to anti-money laundering laws in the other countries and jurisdictions in which we operate and hold licenses including Europe, Mexico and Guatemala. We are also subject to financial services regulations, money transfer licensing regulations, consumer protection laws, currency control regulations, escheat laws, privacy and data protection laws and anti-bribery laws.
Additionally, we are subject to anti-money laundering laws in the other countries and jurisdictions in which we operate and hold licenses including Europe, the United Kingdom, Mexico and Guatemala. We are also subject to financial services regulations, money transfer licensing regulations, consumer protection laws, currency control regulations, escheat laws, privacy and data protection laws and anti-bribery laws.
We process remittances to Latin America, Africa and Asia from the United States, Spain, Italy and Germany and from Canada to Latin America and Africa.
We process remittances to Latin America, Europe, Africa and Asia from the United States, Spain, Italy, the United Kingdom and Germany and from Canada to Latin America and Africa.
Additionally, we have expanded our product and service portfolio to include online payment options, pre-paid debit cards and direct deposit payroll cards, which may present different cost, demand, regulatory and risk profiles relative to our core remittance business.
Additionally, we have expanded our product and service portfolio to include online payment options, pre-paid debit cards, direct deposit payroll cards, and other digital channel offerings, which may present different cost, demand, regulatory and risk profiles relative to our core remittance business.
We are required to comply with a minimum fixed charge coverage ratio and a maximum consolidated leverage ratio. As a result of these covenants, we may be limited in how we conduct our business. Failure to comply with such covenants may lead to default and acceleration under our A&R Credit Agreement and may impair our ability to conduct business.
We are required to comply with a minimum interest coverage ratio and a quarterly maximum consolidated leverage ratio. As a result of these covenants, we may be limited in how we conduct our business. Failure to comply with such covenants may lead to default and acceleration under our Second A&R Credit Agreement and may impair our ability to conduct business.
The costs of compliance with, and other burdens imposed by, the CCPA and similar laws may limit the use and adoption of our products and services and/or require us to incur substantial compliance costs, which could have an adverse impact on our business. In addition, the California Privacy Rights Act of 2020 (CPRA), effective January 1, 2023, expanded the CCPA.
The costs of compliance with, and other burdens imposed by, the CCPA and similar laws may limit the use and adoption of our products and services and/or require us to incur substantial compliance costs, which could have an adverse impact on our business. In addition, the California Privacy Rights Act of 2020 (“CPRA”) expanded the CCPA.
Risks Relating to Our Business and Industry If we lose key sending agents, our business with key sending agents is reduced or we are unable to maintain our sending agent network under terms consistent with those currently in place, our business, financial condition and results of operations could be adversely affected.
If we lose key sending agents, our business with key sending agents is reduced or we are unable to maintain our sending agent network under terms consistent with those currently in place, our business, financial condition and results of operations could be adversely affected. Most of our revenue is earned through our sending agent network.
Our future growth will depend, in part, on our ability to continue to develop and successfully introduce new and enhanced methods of providing money remittance services, including the introduction of new digital platforms, that keep pace with competitive introductions, technological changes, and the demands and preferences of our agents, consumers and the financial institutions with which we conduct our business.
Our future growth will depend, in part, on our success in expanding customer acceptance of our digital services and infrastructure, as well as our ability to continue to develop and successfully introduce new and enhanced methods of providing money remittance services, including the introduction of new digital platforms and other products and services, that keep pace with competitive introductions, technological changes, and the demands and preferences of our agents, consumers, digital partners and the financial institutions with which we conduct our business.
A significant percentage of our banking relationships are concentrated in a few banks. A substantial portion of the transactions that we conduct with and through banks are concentrated in a few banks, notably Wells Fargo, Bank of America and US Bank.
A substantial portion of the transactions that we conduct with and through banks are concentrated in a few banks, notably Wells Fargo, Bank of America and US Bank.
Most of our revenue is earned through our sending agent network. Sending agents are the persons who interact with consumers and provide them with our money remittance services. If sending agents decide to leave our network, our revenue and profits could be adversely affected.
Sending agents are the persons who interact with consumers and provide them with our money remittance services. If sending agents decide to leave our network, our revenue and profits could be adversely affected.
If alternative payment mechanisms become widely accepted as substitutes for our current services, and we do not develop and offer similar alternative payment mechanisms successfully and on a timely basis, our business, financial condition and results of operations could be adversely affected.
If we fail to gain customer acceptance of our digital services and products or if alternative payment mechanisms become widely accepted as substitutes for our current services, and we do not develop and offer similar alternative payment mechanisms successfully and on a timely basis, our business, financial condition and results of operations could be adversely affected.
A public health epidemic or pandemic can have a material adverse effect on the demand for our money remittance services to the extent it adversely affects the markets in which we operate, and poses the risk that we or our employees, network of agents and consumers and their beneficiaries may be prevented from conducting business activities for an indefinite period of time, including due to shutdowns requested or mandated by governmental authorities, or that such epidemic may otherwise interrupt or impair business activities.
A public health epidemic or pandemic can have a material adverse effect on the demand for our money remittance services to the extent it adversely affects the markets in which we operate, and poses the risk that we or our employees, network of agents and consumers and their beneficiaries may be prevented from conducting business activities for an indefinite period of time, including due to shutdowns requested or mandated by governmental authorities, or that such epidemic may otherwise interrupt or impair business activities. 15 Index If consumer confidence in our business, brands or in consumer money remittance providers generally deteriorates, our business, financial condition and results of operations could be adversely affected.
Our Amended and Restated Credit Agreement (the "A&R Credit Agreement") contains operating covenants and financial covenants that may in each case limit management’s discretion with respect to certain business matters.
Our Second A&R Credit Agreement (as defined herein) contains operating covenants and financial covenants that may in each case limit management’s discretion with respect to certain business matters.
We rely on the ability of our employees and our internal systems and procedures to process these transactions in an efficient, uninterrupted, and error-free manner.
The success of our business particularly depends upon the efficient and error-free handling of transactions and data. We rely on the ability of our employees and our internal systems and procedures to process these transactions in an efficient, uninterrupted, and error-free manner.
Our charter designates the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us. 24 Index Our charter provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed to us or our stockholders by any of our directors, officers, employees or agents, (iii) any action asserting a claim against us arising under the DGCL or (iv) any action asserting a claim against us that is governed by the internal affairs doctrine.
Our charter provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed to us or our stockholders by any of our directors, officers, employees or agents, (iii) any action asserting a claim against us arising under the DGCL or (iv) any action asserting a claim against us that is governed by the internal affairs doctrine.
For example, the CPRA establishes a new California Privacy Protection Agency to implement and enforce the CPRA, which could increase the risk of an enforcement action. Other states have also enacted data privacy laws.
For example, the CPRA established a California Privacy Protection Agency to implement and enforce the CPRA, which could increase the risk of an enforcement action. Other states have also enacted data privacy laws such as the Consumer Data Protection Act in Virginia, the Colorado Privacy Act in Colorado, and the Consumer Privacy Act adopted in Utah.
In addition, improper activities, lawsuits or investigations involving our agents may adversely impact our business, financial condition and results of operations or reputation even if we are not directly involved.
In addition, improper activities, lawsuits or investigations involving our agents may adversely impact our business, financial condition and results of operations or reputation even if we are not directly involved. We could be adversely affected by violations of the FCPA or other similar anti-corruption laws.
For example, if our services do not offer competitive features and functionalities, we may lose customers to our competitors, which could adversely affect our business, financial condition and results of operations. In addition, if we fail to price our services appropriately relative to our competitors, consumers may not use our services, which could adversely affect our business and financial results.
In addition,, if our services do not offer competitive features and functionalities, we may be unable to attract new customers or we may lose customers to our competitors, which could adversely affect our business, financial condition and results of operations.
Failure to comply with existing or future data privacy and cybersecurity laws, regulations, and requirements, including by reason of inadvertent disclosure of personal information, could result in significant adverse consequences, including reputational harm, civil litigation, regulatory enforcement, costs of remediation, increased expenses for security systems and personnel, or harm to our consumers and harm to our agents.
Failure to comply with existing or future data privacy and cybersecurity laws, regulations, and requirements, including by reason of inadvertent disclosure of personal information, could result in significant adverse consequences, including reputational harm, civil litigation, regulatory enforcement, costs of remediation, increased expenses for security systems and personnel, or harm to our consumers and harm to our agents. 22 Index Also, because our operations and services involve the collection, storage, and processing of personal data of consumers globally, we are subject to the GDPR and similar data protection laws outside the United States.
We could be adversely affected by violations of the FCPA or other similar anti-corruption laws. 21 Index Our operations around the world, particularly in LAC countries and Africa, are subject to anti-corruption laws and regulations, including restrictions imposed by the U.S. FCPA.
Our operations around the world, particularly in LAC countries and Africa, are subject to anti-corruption laws and regulations, including restrictions imposed by the U.S. FCPA.
A failure to recruit and retain key personnel including operating, marketing, financial and technical personnel, could also have a material and adverse impact on our business, financial condition and results of operations. Regulatory and Legal Risks We and our agents are subject to numerous U.S. and international laws and regulations.
A failure to recruit and retain key personnel including operating, marketing, financial and technical personnel, could also have a material and adverse impact on our business, financial condition and results of operations.
If we are unable to effectively manage the technology associated with our business, we could experience increased costs, reductions in system availability, and loss of agents or consumers. 17 Index If we fail to successfully develop and timely introduce new and enhanced services, including the introduction of new digital platforms, or if we make substantial investments in an unsuccessful new service or infrastructure change, our business, financial condition and results of operations could be adversely affected.
If we fail to successfully expand customer acceptance of our digital services and infrastructure or develop and timely introduce new and enhanced services, including the introduction of new digital platforms, or if we make substantial investments in an unsuccessful new service or infrastructure change, our business, financial condition and results of operations could be adversely affected.
Our current risk management and compliance systems may not be able to exhaustively assess or mitigate all risks to which we are exposed from a transaction monitoring perspective. We are engaged in ongoing efforts to enhance our risk management and compliance policies, procedures and systems to assure compliance with anti-money laundering laws and economic sanctions regulations.
Our current risk management and compliance systems may not be able to exhaustively assess or mitigate all risks to which we are exposed from a transaction monitoring perspective.
In addition, the lenders will be able to elect to declare all amounts outstanding under the A&R Credit Agreement to be immediately due and payable and terminate all commitments to lend additional funds. If we are unable to repay those amounts, the lenders under the A&R Credit Agreement could proceed to foreclose against our collateral that secures that indebtedness.
In addition, the lenders will be able to elect to declare all amounts outstanding under the Second A&R Credit Agreement to be immediately due and payable and terminate all commitments to lend additional funds.
There can also be no assurance that the actual future results, performance, benefits or achievements that we expect from our strategies, systems, initiatives or products will occur.
There can also be no assurance that the actual future results, performance, benefits or achievements that we expect from our strategies, systems, initiatives or products will occur. Risks Relating to Our Business and Industry The suspension of our exploration of strategic alternatives could adversely affect our business and our stock price .
Any delay or inability to pay money remittances or make related settlements with our agents could adversely impact our business, financial condition and results of operations. • In the event of a bank failure, we could face risks to the recovery of our bank deposits used for the purpose of settling with our agents.
Any delay or inability to pay money remittances or make related settlements with our agents could adversely impact our business, financial condition and results of operations. 19 Index Also, in the event of a bank failure we could face risks to the recovery of our bank deposits used for the purpose of settling with our agents and we may be unable to borrow from financial institutions or institutional investors on favorable terms, or at all, which could adversely impact our ability to pursue our growth strategy and fund key strategic initiatives.
In addition, data privacy and security laws have been proposed at the federal, state, and local levels in recent years, which could further complicate compliance efforts.
Additionally, several states and localities have enacted measures related to the use of artificial intelligence and machine learning in products and services. In addition, data privacy and security laws have been proposed at the federal, state, and local levels in recent years, which could further complicate compliance efforts.
See the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Intermex—Liquidity and Capital Resources” for more information. 23 Index Under our A&R Credit Agreement, upon the occurrence of an event of default, we will be unable to continue to borrow funds under the A&R Credit Agreement for so long as an event of default is not remedied or waived.
Under our Second A&R Credit Agreement, upon the occurrence of an event of default, we will be unable to continue to borrow funds under the Second A&R Credit Agreement for so long as an event of default is not remedied or waived.
If consumer confidence in our business, brands or in consumer money remittance providers generally deteriorates, our business, financial condition and results of operations could be adversely affected. Our business is built on consumer confidence in our brands and our ability to provide convenient, reliable and value-added money remittance services.
Our business is built on consumer confidence in our brands and our ability to provide convenient, reliable and value-added money remittance services.
Our inability to protect our systems and data from these risks could adversely affect our reputation among consumers, agents, card issuers, paying agents, financial institutions, card networks, partners, and investors and may expose us to penalties, fines, liabilities, and legal claims. 16 Index A significant portion of our business is conducted over the internet, and we rely on the secure processing, storage, and transmission of confidential, sensitive, proprietary, and other types of information relating to our business operations and confidential and sensitive information about consumers, agents, and employees in our computer systems and networks, and in those of our third-party vendors.
A significant portion of our business is conducted over the internet, and we rely on the secure processing, storage, and transmission of confidential, sensitive, proprietary, and other types of information relating to our business operations and confidential and sensitive information about consumers, agents, and employees in our computer systems and networks, and in those of our third-party vendors.
In addition, following an acquisition, we take steps to ensure our data and system security protection measures cover the acquired business as part of our integration process. As such, there may be a period of increased cybersecurity risk during the period between closing an acquisition and the completion of our data and system security integration.
In addition, following an acquisition, we take steps to ensure our data and system security protection measures cover the acquired business as part of our integration process and the regulatory framework under which the acquired entities operate.
Additionally, our business is built upon a proprietary platform that is supported by Intermex employees and partners. Keeping this platform safe, private, and agile so that we may adjust to market demands is critical to our success.
Additionally, our business is built upon proprietary platforms that are supported by Intermex employees and partners. Keeping these platforms safe, private, and agile so that we may adjust to market demands is critical to our success. Individuals, groups, and state-sponsored organizations may take steps that pose threats to our operations, our computer systems, our employees, our consumers, and our agents.
We are also exposed to new political, economic and other uncertainties as a result of the geographic expansion to Europe, Africa, and Asia, any of which could adversely impact our business, financial condition and results of operations.
We are also exposed to new political, economic and other uncertainties as a result of the geographic expansion to Europe, the United Kingdom, Africa, and Asia, any of which could adversely impact our business, financial condition and results of operations. 14 Index The countries in which we operate may impose or tighten foreign currency exchange control restrictions, taxes or limitations with regard to repatriation of earnings and investments from these countries.
We had approximately $189.5 million of indebtedness as of December 31, 2023, consisting of $75.5 million in outstanding borrowings under the term loan facility and $114.0 million in outstanding borrowings under our revolving credit facility.
We had approximately $156.6 million of indebtedness as of December 31, 2024, consisting of outstanding borrowings under our revolving credit facility.
Disruptions to these systems and data centers could adversely affect our business, financial condition and results of operations. Our ability to provide reliable services largely depends on the efficient and uninterrupted operation of our computer network systems and data centers.
Our ability to provide reliable services largely depends on the efficient and uninterrupted operation of our computer network systems, cloud service providers, and data centers. Our business involves the physical and electronic movement of large sums of money and the management of data necessary to do so.
We have granted the lenders a security interest in substantially all of our assets, including the assets of certain subsidiaries.
If we are unable to repay those amounts, the lenders under the Second A&R Credit Agreement could proceed to foreclose against our collateral that secures that indebtedness. We have granted the lenders a security interest in substantially all of our assets, including the assets of certain subsidiaries.
Removed
The countries in which we operate may impose or tighten foreign currency exchange control restrictions, taxes or limitations with regard to repatriation of earnings and investments from these countries.
Added
As part of our commitment to maximize stockholder value, on November 8, 2024, we announced that the Board had initiated a process to assess strategic alternatives including, but not limited to, a potential sale in a private transaction or merger of the Company.
Removed
Individuals, groups, and state-sponsored organizations may take steps that pose threats to our operations, our computer systems, our employees, our consumers, and our agents.
Added
On February 26, 2025, the Company announced that with the approval and recommendation of the SAC, the Board unanimously determined to suspend the Company’s previously announced assessment of strategic alternatives. The suspension of the strategic alternatives process could have an adverse effect on the market price and trading volatility of our common stock.
Removed
Our business involves the physical and electronic movement of large sums of money and the management of data necessary to do so. The success of our business particularly depends upon the efficient and error-free handling of transactions and data.
Added
In particular, we face increasing competition from digital providers of money transmission services, in response to which we have developed an expanded suite of digital products.
Removed
A substantial portion of our cash and cash equivalents held at U.S. banks are not subject to federal deposit insurance protection against loss as they exceed the federal deposit insurance limit.
Added
Notwithstanding, our ability to increase our revenues and operating results from digital services will require a significant investment in marketing and ongoing product development efforts, which investments are likely, in the short-term, to adversely affect our results of operations.
Removed
Similarly, we hold cash and cash equivalents at foreign banks, which may not enjoy benefits such as the United States’ federal deposit insurance protection. • We may be unable to borrow from financial institutions or institutional investors on favorable terms, or at all, which could adversely impact our ability to pursue our growth strategy and fund key strategic initiatives.
Added
Moreover, there can be no assurance, however, that these efforts will generate expected returns or that consumers will find our digital products more attractive than those of our competitors.
Removed
For example, Virginia passed the Consumer Data Protection Act, Colorado passed the Colorado Privacy Act, and Utah passed the Consumer Privacy Act, all of which became effective in 2023. Additionally, several states and localities have enacted measures related to the use of artificial intelligence and machine learning in products and services.
Added
In addition, if we fail to price our services appropriately relative to our competitors, consumers may not use our services, which could adversely affect our business and financial results.
Added
We are engaged in ongoing efforts to enhance our risk management and compliance policies, procedures and systems to assure compliance with anti-money laundering laws and economic sanctions regulations in the jurisdictions in which we operate.
Added
Our inability to protect our systems and data from these risks could adversely affect our reputation among consumers, agents, card issuers, paying agents, financial institutions, card networks, partners, and investors and may expose us to penalties, fines, liabilities, and legal claims.
Added
As such, there may be a period of increased cybersecurity risk during the period between closing an acquisition and the completion of our data and system security integration. Our inability to protect our systems and data from these and similar risks could, among other consequences, adversely affect our reputation, business, financial condition, and results of operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe results of the third-party audit and internal vulnerability reviews are used by the CISO to guide investments in cybersecurity capabilities, solutions, and services to reduce the Company's exposure to cybersecurity risks. To aid managing, prioritizing and remediating any identified cybersecurity, software engineering, and IT infrastructure risks, the Company has implemented a risk register.
Biggest changeThe Company engages a third party to perform an annual cybersecurity audit, which attests compliance with our Cybersecurity Program and industry best practices. The results of the third-party audit and internal vulnerability reviews are used by the CISO to guide investments in cybersecurity capabilities, solutions, and services to reduce the Company's exposure to cybersecurity risks.
The foundation of our Cybersecurity Program is based on recognized best practices and standards for cybersecurity and information technology that include the Center of Internet Security ("CIS") Controls Framework. The CIS Critical Security Controls Framework is a prioritized set of safeguards to mitigate the most prevalent cyber-attacks against systems and networks.
The foundation of our Cybersecurity Program is based on recognized best practices and standards for cybersecurity and information technology that include the Center of Internet Security (“CIS”) Controls Framework. The CIS Critical Security Controls Framework is a prioritized set of safeguards to mitigate the most prevalent cyber-attacks against systems and networks.
To mitigate cybersecurity risks, the Company has designed and implemented a Cybersecurity and Information Security Program ("Cybersecurity Program"), which is managed and executed by our Chief Information Security Officer ("CISO"). Our CISO has over 20 years of experience in information technology and cybersecurity primarily focused in the financial services industry.
To mitigate cybersecurity risks, the Company has designed and implemented a Cybersecurity and Information Security Program ("Cybersecurity Program"), which is managed and executed by our Chief Information Security Officer (“CISO”). Our CISO has over 20 years of experience in information technology and cybersecurity primarily focused in the financial services industry.
Any cybersecurity incidents affecting our computer networks, databases, third-party services or facilities could lead to potential interruptions of our operations or our ability to manage and report our operating results.
Any cybersecurity incidents 26 affecting our computer networks, databases, third-party services or facilities could lead to potential interruptions of our operations or our ability to manage and report our operating results.
In addition, the CISO provides a comprehensive annual report on cybersecurity as well as quarterly updates to the Audit Committee, the Board and Internal Technology Steering Committee ("IT Steering Committee"), which is composed of members from our Executive Management team and key Information Technology ("IT") personnel.
In addition, the CISO provides a comprehensive annual report on cybersecurity as well as quarterly updates to the Audit Committee, the Board and Internal Technology Steering Committee (“IT Steering Committee”), which is composed of members from our Executive Management team and key Information Technology (“IT”) personnel.
Our cybersecurity partners maintain continuous security operations centers, threat intelligence, response capabilities, and incident response services. These services are tested for effectiveness annually as part of the internal penetration testing process. As mentioned above, the Company has implemented an incident response plan and incident response team that meets at least annually to assess breach scenarios and improve our response capabilities.
These services are tested for effectiveness annually as part of the internal penetration testing process. As mentioned above, the Company has implemented an incident response plan and incident response team that meets at least annually to assess breach scenarios and improve our response capabilities.
Intermex has experienced, and may continue to experience, cybersecurity threats in the normal course of its business. To date, however, these events have not had a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or reputation. See Item 1A. Risk Factors for additional information on how risks could materially affect the Company.
To date, however, these events have not had a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or reputation. See Item 1A. Risk Factors for additional information on how risks could materially affect the Company.
The risk register is maintained by the IT Department and the status of remediation efforts is communicated to management during the quarterly meetings of the IT Steering Committee. Any significant, control failure, weakness or cybersecurity incident is reported by the CISO to the Company's incident response team and prioritized for remediation in accordance with our cybersecurity incident response plan.
Any significant, control failure, weakness or cybersecurity incident is reported by the CISO to the Company's incident response team and prioritized for remediation in accordance with our cybersecurity incident response plan.
Cybersecurity incidents may also result in the inappropriate use or disclosure of personal information, which could adversely affect consumers’ confidence in our or our agents’ business and expose us to liabilities. As a result, we are required to expend significant capital and other resources to protect us against these security breaches or to alleviate problems caused by these breaches.
Cybersecurity incidents may also result in the inappropriate use or disclosure of personal information, which could adversely affect consumers’ confidence in our or our agents’ or digital partners' business and expose us to liabilities.
We have created and continually update, as required, a detailed cybersecurity incident response plan, which outlines the steps to be followed from incident detection to eradication, recovery and notification and which we implement in the event of a cybersecurity incident. 25 The Company engages a third party to perform an annual cybersecurity audit, which attests compliance with our Cybersecurity Program and industry best practices.
We have created and continually update, as required, a detailed cybersecurity incident response plan, which outlines the steps to be followed from incident detection to eradication, recovery and notification and which we will implement in the event of a cybersecurity incident, including the determination of materiality of cybersecurity incidents to ensure accurate and timely disclosures of those events in accordance with current regulatory requirements.
A risk assessment is conducted regularly against NIST and CIS frameworks to determine gaps in controls that exposes the Company to a risk level that requires mitigation efforts. The Company requires in depth security monitoring continuous and real-time, detection of, and responses to cybersecurity threats and has partnered with industry leading managed service providers to accomplish this objective.
The Company requires in depth security monitoring continuous and real-time, detection of, and responses to cybersecurity threats and has partnered with industry leading managed service providers to accomplish this objective. Our cybersecurity partners maintain continuous security operations centers, threat intelligence, response capabilities, and incident response services.
In addition to the third-party audit, we perform ongoing vulnerability reviews and conduct annual penetration testing of both external and internal systems. These tests are conducted by qualified external consultants and all findings are reported to the CISO and any deficiency is tracked until it has been fully remediated.
In addition to the third-party audit, we perform ongoing vulnerability reviews and conduct annual penetration testing of certain external and internal systems based on selected criteria as determined by Management in conjunction with external consultants.
Added
As a result, we are required to expend significant capital and other resources to protect us against these security breaches or to alleviate problems caused by these breaches. Intermex has experienced, and may continue to experience, cybersecurity threats in the normal course of its business.
Added
To aid managing, prioritizing and remediating any identified cybersecurity, software engineering, and IT infrastructure risks, the Company has implemented a risk register. The risk register is maintained by the IT Department and the status of remediation efforts is communicated to management during the quarterly meetings of the IT Steering Committee.
Added
These tests are conducted by qualified external consultants and all findings are reported to the CISO and any deficiency is tracked until it has been fully remediated. A risk assessment is conducted regularly based on NIST and CIS frameworks to determine gaps in controls that exposes the Company to a risk level that requires mitigation efforts.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIn December 2022, we entered into a lease agreement, which expires in 2033, for our new headquarters to accommodate our growing workforce. We completed the move to the new headquarters in February 2024.
Biggest changeWe periodically review our facility requirements and may acquire new facilities, or modify, update, consolidate, dispose of or sublet existing facilities based on evolving business needs. In December 2022, we entered into a lease agreement, which expires in 2033, for our new headquarters to accommodate our growing workforce. We completed the move to the new headquarters in February 2024.
ITEM 2. PROPERTIES Our leased corporate offices are located in Miami, Florida. We lease four other facilities in the United States, located in Miami, Florida and New York, New York and two facilities internationally, located in Madrid, Spain and Milan, Italy.
ITEM 2. PROPERTIES Our leased corporate offices are located in Miami, Florida. We lease three other facilities in the United States, located in Miami, Florida and New York, New York and three facilities internationally, located in Madrid, Spain, Milan, Italy and London, England.
In addition, as of December 31, 2023, we lease 107 Company-operated stores throughout the United States, one Company-operated store in Canada and 12 Company-operated stores throughout Spain, Italy and Germany. Substantially all our facilities are leased.
In 27 Index addition, as of December 31, 2024, we lease 102 Company-operated stores throughout the United States and 13 Company-operated stores throughout Spain, Italy, the United Kingdom and Germany. Substantially all our facilities are leased.
Our main international customer service centers are located in Guatemala City, Guatemala, Aguascalientes, Mexico, and Puebla, Mexico where our employees answer operational questions from agents and customers. Our facilities are used for operational, sales and administrative purposes in support of our business, and are all currently being utilized as intended.
Our main international customer and shared service centers are located in Guatemala City, Guatemala, Aguascalientes, Mexico, and Puebla, Mexico where our employees answer operational questions from agents and customers, and provide back-office support to our operating entities in the United States and Europe.
Removed
We believe that our properties are sufficient to meet our current and projected business needs. We periodically review our facility requirements and may acquire new facilities, or modify, update, consolidate, dispose of or sublet existing facilities, based on evolving business needs.
Added
Our facilities are used for operational, sales and administrative purposes in support of our business, and are all currently being utilized as intended. We believe that our properties are sufficient to meet our current and projected business needs.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed2 unchanged
Biggest changeReference is made to Note 18 – Commitments and Contingencies in the Consolidated Financial Statements of International Money Express, Inc. contained elsewhere in this Annual Report on Form 10–K for information regarding certain legal proceedings to which we are a party, which information is incorporated by reference herein. ITEM 4. MINE SAFETY DISCLOSURES Not Applicable. 26 Index PART II
Biggest changeReference is made to Note 19 – Commitments and Contingencies in the Consolidated Financial Statements of International Money Express, Inc. contained elsewhere in this Annual Report on Form 10–K for information regarding certain legal proceedings to which we are a party, which information is incorporated by reference herein. ITEM 4. MINE SAFETY DISCLOSURES Not Applicable. 28 Index PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest change(b) On August 18, 2021, the Company’s Board of Directors approved a stock repurchase program that authorizes the Company to purchase up to $40.0 million of outstanding shares of the Company’s common stock and which authorization was increased on March 3, 2023 to an additional $100 million of the Company's outstanding shares (the “Repurchase Program”).
Biggest change(b) On August 18, 2021, the Company’s Board of Directors approved a stock repurchase program (the “Repurchase Program”) that authorizes the Company to purchase up to $40.0 million of outstanding shares of the Company’s common stock. The Repurchase Program does not have an expiration date.
The graph assumes the value of the investment in our common stock and each index was $100 on December 31, 2018 and that all dividends were reinvested. The graph plots the value of the initial $100 investment at quarterly intervals for the fiscal years shown.
The graph assumes the value of the investment in our common stock and each index was $100 on December 31, 2019 and that all dividends were reinvested. The graph plots the value of the initial $100 investment at quarterly intervals for the fiscal years shown.
The following graph shows a comparison of cumulative total shareholder return, calculated on a dividend-reinvested basis, for (1) the Company’s common stock, (2) the NASDAQ US Benchmark TR Index and (3) our Peer Group, for the period from December 31, 2018 through December 31, 2023.
The following graph shows a comparison of cumulative total shareholder return, calculated on a dividend-reinvested basis, for (1) the Company’s common stock, (2) the NASDAQ US Benchmark TR Index and (3) our Peer Group, for the period from December 31, 2019 through December 31, 2024.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market for the Company’s Common Stock Our common stock trades on the Nasdaq Capital Market under the symbol “IMXI”. As of February 23, 2024, there were 61 holders of record of our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market for the Company’s Common Stock Our common stock trades on the Nasdaq Capital Market under the symbol “IMXI”. As of February 24, 2025, there were 52 holders of record of our common stock.
Performance Graph The Company’s peer group (“Peer Group”) consists of publicly-traded companies that are in the money remittance and payment industries and is composed of the following: MoneyGram, Euronet, Remitly and Western Union.
Performance Graph The Company’s peer group (“Peer Group”) consists of publicly-traded companies that are in the money remittance and payment industries and is composed of the following: MoneyGram (for periods prior to its acquisition by Madison Dearborn Partners in June 2023), Euronet, Remitly and Western Union.
The following table provides information about repurchases of our common stock during the quarter ended December 31, 2023: Period Total Number of Shares Purchased (a) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program (b) Approximate Dollar Value of Shares that May Yet be Purchased under the Program October 1 through October 31 193,400 $ 16.60 193,341 $ 77,464,691 November 1 through November 30 172,720 $ 19.82 169,907 $ 74,097,603 December 1 through December 31 1,058,277 $ 20.38 159,636 $ 70,681,122 Total 1,424,397 522,884 (a) Includes (i) 59, (ii) 2,813 and (iii) 128,238 shares withheld for income tax purposes in October 2023, November 2023 and December 2023, respectively, in connection with shares issued under compensation and benefit programs.
The following table provides information about repurchases of our common stock during the quarter ended December 31, 2024: Period Total Number of Shares Purchased (a) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program (b) Approximate Dollar Value of Shares that May Yet be Purchased under the Program October 1 through October 31 421,354 $ 17.72 418,820 $ 75,756,376 November 1 through November 30 316,647 $ 20.34 316,463 $ 69,320,196 December 1 through December 31 351,211 $ 21.09 290,538 $ 63,177,870 Total 1,089,212 1,025,821 (a) Includes (i) 2,534, (ii) 184 and (iii) 60,673 shares withheld for income tax purposes in October 2024, November 2024 and December 2024, respectively, in connection with shares issued under compensation and benefit programs.
Removed
In addition, on December 4, 2023 the Company repurchased 100,000 shares at a price of $20.57 per share in a privately negotiated transaction outside of the Repurchase Program. In addition, on December 12, 2023, the Company repurchased 670,403 shares at a price of $19.78 per share in a privately negotiated transaction outside of the Repurchase Program.
Added
On March 3, 2023, the Board of Directors approved an increase to the Repurchase Program that authorizes the Company to purchase an additional $100.0 million of its outstanding shares.
Removed
The Repurchase Program does not have an expiration date. 27 Index ITEM 6. [RESERVED] 28 Index
Added
On August 26, 2024, the Board of Directors approved an increase to the Repurchase Program that authorizes the Company to purchase an additional $63.8 million of its outstanding shares. 29 Index ITEM 6. [RESERVED] 30 Index

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe increase was primarily the result of: • $6.3 million - higher facilities and rent expenses for scheduled maintenance and contracted lease rate increases to support our business growth and expenses related to the company-operated stores and other facilities added as a result of the La Nacional and LAN Holdings acquisitions; • $2.8 million - higher IT related expenses incurred to sustain our business expansion and to improve our technology environment; • $2.4 million - increase in provision for credit losses due to higher net write-offs of accounts receivable during the year ended December 31, 2023 compared to the year ended December 31, 2022, primarily as a result of sending agents that were not able to pay in accordance with the original terms and are, accordingly, subject to our normal collection procedures; 35 Index • $1.0 million - higher loss on disposal of assets primarily due to replacement of equipment used by our agent network and write-off of equipment assigned to sending agents closed during the year ended December 31, 2023, as well as $0.3 million in computer equipment write offs related to the restructuring of La Nacional under the Plan; • $0.6 million - higher professional and legal fees to support our expanded operations in the United States and Europe; • $0.5 million - higher property and other indirect taxes due to the acquisition of LAN Holdings; • $0.3 million - higher state license & bond insurance due to the acquisition of La Nacional; and • $0.8 million - refund of state business and occupancy tax from the state of Washington in 2022 that did not recur in 2023.
Biggest changeThe increase was primarily the result of: • $1.4 million - increase in provision for credit losses primarily due to a higher average balance outstanding of receivable balances from sending agents during the year ended December 31, 2024 compared to 2023, and a slight increase in write-offs of receivable balances primarily as a result of sending agents that were not able to pay in accordance with the original terms of their agreements with us and are, accordingly, subject to our normal collection procedures; and • $0.9 million - increase in advertising related expenses primarily as a result of campaigns to promote our digital channel services.
The increase in Adjusted Earnings per Share - Basic was primarily due to higher net income for the year combined with the effect of a lower weighted average common shares total for the year due to stock repurchases, partially offset by the lower net effect of the adjusting items detailed in the table above.
The increase in Adjusted Earnings per Share - Basic was primarily due to the effect of a lower weighted average common shares total for the year due to stock repurchases combined with the higher net effect of the adjusting items detailed in the table above, partially offset by lower net income for the year.
See “ Risk Factors—Risks Relating to Our Indebtedness—The Company's indebtedness may limit our operating flexibility and could adversely affect our business, financial condition and results of operations” and "Our Amended and Restated Credit Agreement contains covenants that may limit our ability to conduct business" included elsewhere in this Annual Report on Form 10-K.
See “ Risk Factors—Risks Relating to Our Indebtedness—The Company's indebtedness may limit our operating flexibility and could adversely affect our business, financial condition and results of operations” and "Our Second Amended and Restated Credit Agreement contains covenants that may limit our ability to conduct business" included elsewhere in this Annual Report on Form 10-K.
Regardless, we continue to innovate in the industry by differentiating our money remittance business through programs to foster loyalty among agents as well as consumers and have expanded our channels through which our services are accessed to include online and mobile offerings which are experiencing consumer adoption.
Regardless, we continue to innovate in the industry by differentiating our money remittance business through programs to foster loyalty among agents as well as consumers and have expanded our channels through which our services are accessed to include online and mobile offerings which are experiencing higher consumer adoption.
Liquidity and Capital Resources We consider liquidity in terms of cash and cash equivalents position, cash flows from operations and their sufficiency to fund business operations, including working capital needs, debt service, acquisitions, capital expenditures, contractual obligations and other commitments.
Liquidity and Capital Resources We consider liquidity in terms of our cash and cash equivalents position, cash flows from operations and their sufficiency to fund business operations, including working capital needs, debt service, acquisitions, capital expenditures, contractual obligations and other commitments.
Recent Accounting Pronouncements Refer to Part II, Item 8, Financial Statements and Supplementary Data, Note 2, “Summary of Significant Accounting Policies” , for further discussion.
Recent Accounting Pronouncements Refer to Part II, Item 8, Financial Statements and Supplementary Data, Note 2, “Summary of Significant Accounting Policies” , for further discussion on recent accounting pronouncements.
After consideration of all evidence, both positive and negative, management has determined that no valuation allowance is required at December 31, 2023 on the Company’s U.S. federal or state deferred tax assets; however, a valuation allowance has been recorded as of December 31, 2023 on deferred tax assets associated with foreign net operating loss carryforwards.
After consideration of all evidence, both positive and negative, management has determined that no valuation allowance is required at December 31, 2024 on the Company’s U.S. federal or state deferred tax assets; however, a valuation allowance has been recorded as of December 31, 2024 on deferred tax assets associated with foreign net operating loss carryforwards.
Our income tax provision reflects the effects of state taxes, non-deductible expenses, share-based compensation expense, and foreign tax rates applicable to the Company’s foreign subsidiaries that are higher or lower than the U.S. statutory rate. Net Income Net income is determined by subtracting operating and non-operating expenses from revenues.
Our income tax provision reflects the effects of state taxes, non-deductible expenses, share-based 35 Index compensation expense, and foreign tax rates applicable to the Company’s foreign subsidiaries that are higher or lower than the U.S. statutory rate. Net Income Net income is determined by subtracting operating and non-operating expenses from revenues.
We generally compete for money remittance agents on the basis of value, service, quality, technical and operational differences, commission structure and marketing efforts. As a philosophy, we sell credible solutions to our sending agents, not discounts or higher commissions, as is typical for the industry.
We generally compete for money remittance agents on the basis of value, service, quality, technical and operational differences, commission structure and marketing efforts. As a philosophy, we sell credible solutions to our sending agents, not 33 Index discounts or higher commissions, as is typical for the industry.
Political, social and economic conditions in key Latin American markets continue to exhibit instability, as evidenced by higher interest rates, high unemployment rates, restricted lending activity, higher inflation, volatility in foreign currencies and low consumer confidence, among other economic and market factors.
Political, social and economic conditions in key Latin American markets continue to exhibit instability, as evidenced by higher interest rates, high unemployment rates, increasing immigration rates, restricted lending activity, higher inflation, volatility in foreign currencies and low consumer confidence, among other economic and market factors.
Our remittance services, which include a comprehensive suite of ancillary financial processing solutions and payment services, are available in all 50 states in the U.S., Washington D.C., Puerto Rico and 13 provinces in Canada, as well as in certain locations in Spain, Italy and Germany, where consumers can send money to beneficiaries in more than 60 countries in LAC, Africa and Asia.
Our remittance services, which include a comprehensive suite of ancillary financial processing solutions and payment services, are available in all 50 states in the U.S., Washington D.C., Puerto Rico and 13 provinces in Canada, as well as in certain locations in Spain, Italy, Germany and the United Kingdom, where consumers can send money to beneficiaries in more than 60 countries in LAC, Europe, Africa and Asia.
Results of Operations A discussion of changes in our results of operations and cash flows from fiscal year 2022 to fiscal year 2021 has been omitted from this Annual Report on Form 10-K, but may be found in “Item 7.
Results of Operations A discussion of changes in our results of operations and cash flows from fiscal year 2023 to fiscal year 2022 has been omitted from this Annual Report on Form 10-K, but may be found in “Item 7.
Remittances paid in local currencies that are not pegged to the U.S. dollar, Canadian dollar or Euro can also generate revenue if we are successful in our daily management of currency exchange spreads.
Remittances paid in local currencies that are not pegged to the U.S. dollar, Canadian dollar, Euro or British pound can also generate revenue if we are successful in our daily management of currency exchange spreads.
The three largest remittance corridors we serve are United States to Mexico, United States to Guatemala and Unites States to the Dominican Republic. According to the latest information available from the World Bank Remittance Matrix, the United States to Mexico remittance corridor was one of the largest in the world in 2023.
The three largest remittance corridors we serve are United States to Mexico, United States to Guatemala and Unites States to the Dominican Republic. According to the latest information available from the World Bank Remittance Matrix, the United States to Mexico remittance corridor was one of the largest in the world in 2024 .
Therefore, we believe that our current cash and cash equivalents position, as well as projected cash flows generated from operations, together with borrowings under our revolving credit facility are sufficient to fund the principal and interest payments on our debt, lease expenses, our working capital needs, our business acquisitions and our expected capital expenditures in the long-term.
Therefore, we believe that our current cash and cash equivalents position, as well as projected cash flows generated from operations, together with borrowings under our revolving credit facility are sufficient to fund the principal and interest payments on our debt, lease expenses, our working capital needs, our business acquisitions and our expected capital expenditures in the short and long terms.
We maintain a strong cash and cash equivalents balance position and have access to committed funding sources, which we have used only on an ordinary course basis during the year ended December 31, 2023.
We maintain a strong cash and cash equivalents balance position and have access to committed funding sources, which we have used only on an ordinary course basis during the year ended December 31, 2024.
Upon such an occurrence, recoverability of assets to be 43 Index held and used is measured by comparing the carrying amount of an asset to forecasted undiscounted future net cash flows expected to be generated by the asset.
Upon such an occurrence, recoverability of assets to be 46 Index held and used is measured by comparing the carrying amount of an asset to forecasted undiscounted future net cash flows expected to be generated by the asset.
Share-based compensation is primarily recognized as an expense on a straight-line basis over the requisite service period; unrecognized compensation expense related to stock options, restricted stock units (“RSUs”), restricted stock awards (“RSAs”) and performance stock units (“PSUs”) of approximately $11.9 million is expected to be recognized over a weighted-average period of 1.8 years.
Share-based compensation is primarily recognized as an expense on a straight-line basis over the requisite service period; unrecognized compensation expense related to restricted stock units (“RSUs”), restricted stock awards (“RSAs”) and performance stock units (“PSUs”) of approximately $12.8 million is expected to be recognized over a weighted-average period of 1.9 years.
For example, non-cash compensation costs can be subject to volatility from changes in the market price per share of our common stock or variations in the value and number of shares granted, and amortization of intangible assets is subject to business acquisition activities, which varies from period to period.
For example, non-cash compensation costs can be subject to volatility 39 Index from changes in the market price per share of our common stock or variations in the value and number of shares granted, and amortization of intangible assets is subject to business and asset acquisition activities, which varies from period to period.
Our money remittance services enable consumers to send funds through our broad network of locations in the United States, Canada, Spain, Italy and Germany, which are primarily operated by third-party businesses, as well as by Company-operated stores located in those jurisdictions.
Our money remittance services enable consumers to send funds through our broad network of locations in the United States, Canada, Spain, Italy, Germany and the United Kingdom that are primarily operated by third-party businesses, as well as by Company-operated stores located in those jurisdictions.
Accounts receivable are recorded upon initiation of the wire transfer and are typically due to the Company within five days. The Company maintains an allowance for credit losses for estimated losses resulting from the inability of its sending agents to make required payments.
Accounts receivable are recorded upon initiation of the wire transfer and are typically due to the Company within five days. The Company maintains an allowance for credit losses for estimated losses resulting from the inability of its sending agents or digital partners to make required payments.
Our primary cash needs are for day-to-day operations, to pay interest and principal on our indebtedness, to fund working capital requirements and to make capital expenditures. We have funded and still expect to continue funding our liquidity requirements through internally generated funds, supplemented in the ordinary course, with borrowings under our revolving credit facility.
Our primary cash needs are for day-to-day operations, to pay interest and principal on our indebtedness, to fund working capital requirements, to make capital expenditures and repurchases of our common stock. We have funded and still expect to continue funding our liquidity requirements through internally generated funds, supplemented in the ordinary course, with borrowings under our revolving credit facility.
The A&R Credit Agreement, as amended, permits the Company to make restricted payments (including share repurchases, among others) under a variety of tests as described in the second preceding paragraph, including, without limitation, so long as the Consolidated Leverage Ratio (as defined in the A&R Credit Agreement, as amended), as of the then most recently completed four fiscal quarters of the Company, after giving pro forma effect to such restricted payments, is 2.25:1.00 or less.
The Second A&R Credit Agreement permits the Company to make restricted payments (including share repurchases, among others) under a variety of tests as described above, including, without limitation, so long as the Consolidated Leverage Ratio (as defined in the Second A&R Credit Agreement), as of the then most recently completed four fiscal quarters of the Company, after giving pro forma effect to such restricted payments, is 2.50:1.00 or less.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 15, 2023, which is available free of charge on the SEC’s website at www.sec.gov and at www.intermexonline.com, by clicking “Investors” located at the bottom of the page.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 28, 2024, which is available free of charge on the SEC’s website at www.sec.gov and at www.intermexonline.com, by clicking “Investors” located at the bottom of the page.
Financing Activities Net cash used in financing activities was $37.1 million for the year ended December 31, 2023, which primarily consisted of $5.5 million in scheduled quarterly payments due on the term loan facility, $66.3 million of repurchases of common stock and $3.9 million of net payments for shares withheld in connection with stock-based compensation arrangements and related payments to taxing authorities, 42 Index offset by $38.0 million of borrowings, net under the revolving credit facility that varies primarily due to timing of prefunding of paying agents primarily for weekends and $1.3 million in proceeds from issuance of stock as a result of the exercise of options.
Net cash provided by financing activities was $37.1 million for the year ended December 31, 2023, which primarily consisted of $5.5 million in scheduled quarterly payments due on the term loan facility, $66.3 million of repurchases of common stock and $3.9 million of net payments for shares withheld for tax payments in connection with share-based compensation arrangements, offset by $38.0 million of borrowings, net under the revolving credit facility that varies primarily due to timing of prefunding of paying agents primarily for weekends and $1.3 million in proceeds from issuance of stock as a result of the exercise of options.
These increases were partially offset by a decrease of approximately $1.0 million in amortization related to our Intermex trade name, developed technology and agent relationships during the year ended December 31, 2023, as these intangibles are being amortized on an accelerated basis, which declines over time.
These increases were partially offset by a decrease of approximately $0.9 million in amortization related to our trade names, developed technology and agent relationships during the year ended December 31, 2024, as these intangibles are being amortized on an accelerated basis, which declines over time.
The increase in Adjusted Net Income was primarily due to the increase in net income discussed above partially offset by the lower net effect of the adjusting items detailed in the table below.
The increase in Adjusted EBITDA was primarily due to the higher net effect of the adjusting items detailed in the table below, partially offset by the decrease in net income discussed above.
Key Factors and Trends Affecting our Business Various trends and other factors have affected and may continue to affect our business, financial condition and operating results, including, but not limited to: • loss of, or reduction in business with, key sending agents; • our ability to effectively compete in the markets in which we operate; • economic factors such as inflation, the level of economic activity, recession risks and labor market conditions, as well as rising interest rates; • international political factors, political instability, tariffs, border taxes or restrictions on remittances or transfers from the outbound countries in which we operate or plan to operate; • volatility in foreign exchange rates that could affect the volume of consumer remittance activity and/or affect our foreign exchange related gains and losses; • public health conditions, responses thereto and the economic and market effects thereof; • consumer confidence in our brands and in consumer money transfers generally; • expansion into new geographic markets or product markets; • the Company’s ability to successfully execute, manage, integrate and obtain the anticipated financial benefits of key acquisitions and mergers; • the ability of our risk management and compliance policies, procedures and systems to mitigate risk related to transaction monitoring; • consumer fraud and other risks relating to the authenticity of customers’ orders or the improper or illegal use of our services by consumers; • cybersecurity-attacks or disruptions to our information technology, computer network systems, data centers and mobile device apps; • new technology or competitors that disrupt the current money transfer and payment ecosystem, including the introduction of new digital platforms; • our success in developing and introducing new products, services and infrastructure; 30 Index • our ability to maintain favorable banking and paying agent relationships necessary to conduct our business; • bank failures, sustained financial illiquidity, or illiquidity at the clearing, cash management or custodial financial institutions with which we do business; • changes to banking industry regulation and practice; • credit risks from our agents and the financial institutions with which we do business; • our ability to recruit and retain key personnel; • our ability to maintain compliance with applicable laws and regulatory requirements including those intended to prevent use of our money remittance services for criminal activity, those related to data and cyber-security protection, and those related to new business initiatives; • enforcement actions and private litigation under regulations applicable to the money remittance services; • changes in immigration laws and their enforcement; • changes in tax laws in the countries we operate; • our ability to protect our brands and intellectual property rights; • our ability to satisfy our debt obligations and remain in compliance with our credit facility requirements; • the use of third-party vendors and service providers; and • weakness in U.S. or international economic conditions.
Key Factors and Trends Affecting our Business Various trends and other factors have affected and may continue to affect our business, financial condition and operating results, including, but not limited to: • the potential adverse effects on the Company’s stock price from the suspension of the strategic alternatives evaluation process; • our success in expanding customer acceptance of our digital services, the cost of acquiring digital customers, as well as our ability to continue to develop new products, services and infrastructure; • new technology or competitors that disrupt the current money transfer and payment ecosystem, including the introduction and increased consumer preference for digital platforms; • loss of, or reduction in business with, key sending agents; • our ability to effectively compete in the markets in which we operate; 32 Index • economic factors such as inflation, the level of economic activity, recession risks and labor market conditions, as well as volatility in market interest rates; • international political factors, including ongoing hostilities in Ukraine and the Middle East, political instability, tariffs, including the effects of tariffs on domestic markets and industrial activity and employment, border taxes or restrictions on remittances or transfers from the outbound countries in which we operate or plan to operate; • volatility in foreign exchange rates that could affect the volume of consumer remittance activity and/or affect our foreign exchange related gains and losses; • changes in immigration laws and their enforcement, including its effects on the level of immigrant employment and earning potential; • consumer confidence in our brands and in consumer money transfers generally; • expansion into new geographic markets or product markets; • our ability to successfully execute, manage, integrate and obtain the anticipated financial benefits of key acquisitions and mergers; • the ability of our risk management and compliance policies, procedures and systems to mitigate risk related to transaction monitoring; • consumer fraud and other risks relating to the authenticity of customers’ orders or the improper or illegal use of our services by consumers, sending agents or digital partners; • cybersecurity-attacks or disruptions to our information technology, computer network systems, data centers and mobile device applications; • our ability to maintain favorable banking and paying agent relationships necessary to conduct our business; • bank failures, sustained financial illiquidity, or illiquidity at the clearing, cash management or custodial financial institutions with which we do business; • changes to banking industry regulation and practice; • credit risks from our agents, digital partners and the financial institutions with which we do business; • our ability to recruit and retain key personnel; • our ability to maintain compliance with applicable laws and regulatory requirements including those intended to prevent use of our money remittance services for criminal activity, those related to data and cybersecurity protection, and those related to new business initiatives; • enforcement actions and private litigation under regulations applicable to the money remittance services; • changes in tax laws in the countries we operate; • our ability to protect our brands and intellectual property rights; • our ability to satisfy our debt obligations and remain in compliance with our credit facility requirements; • public health conditions, responses thereto and the economic and market effects thereof; • the use of third-party vendors and service providers; and • weakness in U.S. or international economic conditions.
Adjusted Earnings per Share - Diluted (previously defined and used as described above) for the year ended December 31, 2023 was $1.95, representing an increase of $0.14, or 7.7%, compared to $1.81 for the year ended December 31, 2022.
Adjusted Earnings per Share - Diluted (previously defined and used as described above) for the year ended December 31, 2024 was $2.14, representing an increase of $0.19, or 9.7%, compared to $1.95 for the year ended December 31, 2023.
In addition, the Company does not expect that the Plan will result in any material reduction of revenues or increase of its operating expenses.
In addition, the Company does not expect that the execution of this restructuring plan will result in any material reduction of revenues or increase of its ongoing operating expenses.
In recent years, we expanded our services to allow remittances to Africa and Asia from the United States and also began offering sending services from Canada to Latin America and Africa. Also, through the acquisition of LAN Holdings we now provide remittance services from Spain, Italy and Germany to Africa, Asia and Latin America.
In recent years, we expanded our services to allow remittances to Africa and Asia from the United States and also began offering sending services from Canada to Latin America and Africa. Also, through our recent acquisitions we now provide remittance services from Spain, Italy, Germany and the United Kingdom to Africa, Asia and Latin America.
Transactions are processed and payment is collected by our agent (“sending agent(s)”) and those funds become available for pickup by the beneficiary at the designated destination, usually within minutes, at any Intermex payer location (“paying agent(s)”). We refer to our sending agents and our paying agents collectively as agents.
Transactions are processed and payment is collected by our sending agents and those funds become available for pickup by the beneficiary at the designated destination, usually within minutes, at any Intermex paying agents. We refer to our sending agents and our paying agents collectively as agents.
An independent third-party periodically reviews our policies and procedures and performs independent testing to assess the effectiveness of our anti-money laundering and Bank Secrecy Act compliance program. We also maintain a regulatory affairs and licensing department, under the direction of our Chief Compliance Officer. The market for money remittance services is very competitive.
An independent third-party periodically reviews our policies and procedures and performs independent testing to assess the effectiveness of our anti-money laundering and Bank Secrecy Act compliance program. We also maintain a regulatory affairs, licensing and consumer compliance department, under the direction of our Chief Compliance Officer.
As a result of the Plan, the Company expects to reduce compensation expense and certain facilities related charges in an amount of approximately $1.5 million a year. The anticipated effect of this reduction in expenses will be primarily realized during 2024.
As a result of implementing this restructuring plan, the Company expects to reduce compensation expense and certain facilities related charges in an amount of approximately $2.0 million a year. The anticipated effect of this reduction in expenses will be primarily realized during 2025.
Segments Our business is organized around one reportable segment that provides money transmittal services primarily between the United States and Canada to Mexico, Guatemala and other countries in Latin America, Africa and Asia through a network of authorized agents located in various unaffiliated retail establishments and 122 Company-operated stores throughout the United States, Canada, Spain, Italy and Germany.
Segments Our business is organized around one reportable segment that provides money transmittal services primarily between the United States, Canada and certain countries in Europe to Mexico, Guatemala and other countries in Latin America, Africa and Asia through a network of authorized agents located in various unaffiliated retail establishments and 117 Company-operated stores throughout the United States, Canada, Spain, Italy, Germany and the United Kingdom, as well as digitally through the Internet via our websites and mobile device applications.
Also, we generate revenues from technology services provided to the independent network of agents that utilize the Company’s technology in processing transactions paid by credit or debit card, check cashing services and maintenance fees, for which revenue is derived by a fee per transaction Operating Expenses Service Charges from Agents and Banks Service charges primarily consist of sending and paying agent commissions and bank fees.
Also, we generate revenues from technology services provided to the independent network of agents that utilize the Company’s technology in processing transactions paid by credit or debit card, check cashing services and maintenance fees, for which revenue is derived by a fee per transaction.
Transaction Costs — Transaction Costs of $0.4 million and $3.0 million for the years ended December 31, 2023 and 2022, respectively, relate primarily to financial advisory fees as well as other professional fees and legal fees incurred in connection with business acquisition transactions.
Transaction Costs — Transaction Costs of $1.8 million and $0.4 million for the years ended December 31, 2024 and 2023, respectively, consist primarily of financial advisory fees as well as other professional fees and legal fees incurred in connection with business acquisition transactions and strategic alternatives.
Adjusted Earnings per Share - Basic (previously defined and used as described above) for the year ended December 31, 2023 was $1.99, representing an increase of $0.14, or 7.6%, compared to $1.85 for the year ended December 31, 2022.
Adjusted Earnings per Share - Basic (previously defined and used as described above) for the year ended December 31, 2024 was $2.17, representing an increase of $0.18, or 9.0%, compared to $1.99 for the year ended December 31, 2023.
Adjusted Earnings per Share - Basic and Diluted is calculated by dividing Adjusted Net Income by GAAP weighted-average common shares outstanding (basic and diluted). Adjusted Net Income for the year ended December 31, 2023 was $71.0 million, representing an increase of $1.1 million, or 1.6%, from Adjusted Net Income of $69.9 million for the year ended December 31, 2022.
Adjusted Earnings per Share - Basic and Diluted is calculated by dividing Adjusted Net Income by GAAP weighted-average common shares outstanding (basic and diluted). Adjusted Net Income for the year ended December 31, 2024 was $70.4 million, representing a decrease of $0.6 million, or 0.8%, from Adjusted Net Income of $71.0 million for the year ended December 31, 2023.
The increase of $128.3 million is primarily a result of $116.4 million related to changes in working capital, which varies due to timing of remittance of consumer funds by sending agents, transmittal orders and payments, as well as prefunding of payers primarily for weekends, and additional cash generated by our improved operating results for the year ended December 31, 2023, which reflected the further growth of our business.
The decrease is primarily a result of $93.1 million related to changes in working capital, which varies due to timing of remittance of consumer funds by sending agents, transmittal orders and payments, as well as prefunding of payers primarily for weekends, and additional cash generated by our operating results for the year ended December 31, 2024.
The A&R Credit Agreement also contains covenants that limit the Company’s and its subsidiaries’ ability to, among other things, grant liens, incur additional indebtedness, make acquisitions or investments, dispose of certain assets, change the nature of their businesses, enter into certain transactions with affiliates or amend the terms of material indebtedness.
The Second A&R Credit Agreement also contains customary covenants that limit the ability of the Company and its subsidiaries to, among other things, grant liens, incur additional indebtedness, make acquisitions or investments, dispose of certain assets, issue dividends and distributions (other than to the Company and certain of its subsidiaries), change the nature of their businesses, enter into certain transactions with affiliates, or amend the terms of material indebtedness, in each case subject to certain thresholds and exceptions.
Non-Operating Expenses Interest expense — Interest expense was $10.4 million for the year ended December 31, 2023, an increase of $4.8 million, or 85.7%, from $5.6 million for the year ended December 31, 2022.
Non-Operating Expenses Interest expense — Interest expense was $11.7 million for the year ended December 31, 2024, an increase of $1.3 million, or 12.5%, from $10.4 million for the year ended December 31, 2023.
Our indebtedness could adversely affect our ability to raise additional capital, limit our ability to react to changes in the economy or our industry, expose us to interest rate risk and prevent us from meeting our obligations.
As of December 31, 2024, we were in compliance with these covenants. Our indebtedness could adversely affect our ability to raise additional capital, limit our ability to react to changes in the economy or our industry, expose us to interest rate risk and prevent us from meeting our obligations.
Adjusted EBITDA for the year ended December 31, 2023 was $120.0 million, representing an increase of $14.8 million, or 14.1%, from $105.2 million for the year ended December 31, 2022.
Adjusted EBITDA for the year ended December 31, 2024 was $121.3 million, representing an increase of $1.3 million, or 1.1%, from $120.0 million for the year ended December 31, 2023.
Earnings Per Share Earnings per Share - Basic for the year ended December 31, 2023 was $1.67, representing an increase of $0.15, or 9.9%, compared to $1.52 for the year ended December 31, 2022.
Earnings Per Share Earnings per Share - Basic for the year ended December 31, 2024 was $1.81, representing an increase of $0.14, or 8.4%, compared to $1.67 for the year ended December 31, 2023.
Repurchase Program On August 18, 2021, the Company’s Board of Directors approved a stock repurchase program that authorizes the Company to purchase up to $40.0 million of outstanding shares of the Company’s common stock and which authorization was increased on March 3, 2023 to an additional $100.0 million of the Company's outstanding shares (the “Repurchase Program”).
Repurchase Program On August 18, 2021, the Company’s Board of Directors approved a stock repurchase program (the “Repurchase Program”) that authorizes the Company to purchase up to $40.0 million of its outstanding shares of the Company’s common stock.
Investing Activities Net cash used in investing activities was $18.3 million for the year ended December 31, 2023, an increase of $5.8 million from $12.5 million for the year ended December 31, 2022.
Investing Activities Net cash used in investing activities was $43.9 million for the year ended December 31, 2024, an increase of $25.6 million from $18.3 million for the year ended December 31, 2023.
Our services are accessible in person through over 100,000 independent sending and paying agents and 122 Company-operated stores, as well as online and via Internet-enabled mobile devices.
Our services are accessible in person through over 100,000 independent sending and paying agents and 117 Company-operated stores, as well as digitally through the Internet via our websites and mobile device applications.
The increase in both basic and diluted EPS largely reflect the increased net income discussed above and the effect of a reduced share count as a result of the stock repurchases. 36 Index Non-GAAP Financial Measures We use Adjusted Net Income, Adjusted Earnings per Share and Adjusted EBITDA to evaluate our performance, both internally and as compared with our peers, because these measures exclude certain items that may not be indicative of our core operating results, as well as items that can vary widely among companies within our industry.
Non-GAAP Financial Measures We use Adjusted Net Income, Adjusted Earnings per Share and Adjusted EBITDA to evaluate our performance, both internally and as compared with our peers, because these measures exclude certain items that may not be indicative of our core operating results, as well as items that can vary widely among companies within our industry.
Cash Flows The following table summarizes the changes to our cash flows for the periods presented: Year Ended December 31, (in thousands) 2023 2022 2021 Statement of Cash Flows Data: Net cash provided by operating activities $ 143,525 $ 15,174 $ 78,098 Net cash used in investing activities (18,280) (12,529) (10,773) Net cash (used in) provided by financing activities (37,120) 14,058 (9,616) Effect of exchange rate changes on cash and cash equivalents 1,585 316 (142) Net increase in cash and cash equivalents 89,710 17,019 57,567 Cash and cash equivalents, beginning of the year $ 149,493 $ 132,474 $ 74,907 Cash and cash equivalents, end of the year $ 239,203 $ 149,493 $ 132,474 Operating Activities Net cash provided by operating activities was $143.5 million for the year ended December 31, 2023, an increase of $128.3 million from net cash provided by operating activities of $15.2 million for the year ended December 31, 2022.
Cash Flows The following table summarizes the changes to our cash flows for the periods presented: Year Ended December 31, (in thousands) 2024 2023 2022 Statement of Cash Flows Data: Net cash provided by operating activities $ 53,085 $ 143,525 $ 15,174 Net cash used in investing activities (43,946) (18,280) (12,529) Net cash (used in) provided by financing activities (114,204) (37,120) 14,058 Effect of exchange rate changes on cash and cash equivalents (3,635) 1,585 316 Net (decrease) increase in cash and cash equivalents (108,700) 89,710 17,019 Cash and cash equivalents, beginning of the year $ 239,203 $ 149,493 $ 132,474 Cash and cash equivalents, end of the year $ 130,503 $ 239,203 $ 149,493 Operating Activities Net cash provided by operating activities was $53.1 million for the year ended December 31, 2024, a decrease of $90.4 million from net cash provided by operating activities of $143.5 million for the year ended December 31, 2023.
Non-Operating Expenses Interest Expense Interest expense consists primarily of interest associated with our debt, which consists of a term loan facility and a revolving credit facility.
Non-Operating Expenses Interest Expense Interest expense consists primarily of interest associated with our debt, which consisted of a term loan facility and a revolving credit facility until August 28, 2024. Subsequent to that date, our debt consists of a revolving credit facility.
Depreciation and amortization — Depreciation and amortization of $12.9 million for the year ended December 31, 2023 increased by $3.4 million from $9.5 million, or 35.8%, for the year ended December 31, 2022.
Depreciation and amortization — Depreciation and amortization of $13.6 million for the year ended December 31, 2024 increased by $0.7 million from $12.9 million, or 5.4%, for the year ended December 31, 2023.
The increase in Adjusted EBITDA was primarily due to the higher net effect of the adjusting items detailed in the table below combined with the increase in net income discussed above.
The decrease in Adjusted Net Income was primarily due to the decrease in net income discussed above partially offset by the slightly higher net effect of the adjusting items detailed in the table below.
Transaction Costs We incurred transaction costs primarily associated with the acquisitions of La Nacional and LAN Holdings. These costs included all internal and external costs directly related to the transaction, consisting primarily of legal, consulting, accounting and advisory fees and certain incentive bonuses. Due to their significance, they are presented separately in our consolidated statements of income and comprehensive income.
These costs included all internal and external costs directly related to the transactions, consisting primarily of legal, consulting, accounting and advisory fees and certain incentive bonuses. Due to their significance, they are presented separately in our consolidated statements of income and comprehensive income. For additional information on these acquisitions, see Note 3 to the consolidated financial statements.
The following table presents the reconciliation of Net Income, our closest GAAP measure, to Adjusted Net Income: 37 Index Year Ended December 31, (in thousands, except for share data) 2023 2022 Net Income $ 59,515 $ 57,331 Adjusted for: Share-based compensation (a) 8,111 7,118 Restructuring costs (b) 1,214 — Transaction costs (c) 445 3,005 Loss on bank closure (d) — 1,583 Other charges and expenses (e) 1,850 1,141 Amortization of intangibles (f) 4,740 4,102 Income tax benefit related to adjustments (g) (4,914) (4,376) Adjusted Net Income $ 70,961 $ 69,904 Adjusted Earnings per share Basic $ 1.99 $ 1.85 Diluted $ 1.95 $ 1.81 Weighted-average common shares outstanding Basic 35,604,582 37,733,047 Diluted 36,429,714 38,625,390 (a) Represents shared-based compensation relating to equity awards granted primarily to employees and independent directors of the Company.
The following table presents the reconciliation of Net Income, our closest GAAP measure, to Adjusted Net Income: 40 Index Year Ended December 31, (in thousands, except for share data) 2024 2023 Net Income $ 58,821 $ 59,515 Adjusted for: Share-based compensation (a) 7,043 8,111 Restructuring costs (b) 3,060 1,214 Transaction costs (c) 1,819 445 Legal contingency settlement (d) (570) — Other charges and expenses (e) 1,239 1,850 Amortization of intangibles (f) 3,820 4,740 Income tax benefit related to adjustments (g) (4,820) (4,914) Adjusted Net Income $ 70,412 $ 70,961 Adjusted Earnings per share Basic $ 2.17 $ 1.99 Diluted $ 2.14 $ 1.95 Weighted-average common shares outstanding Basic 32,430,755 35,604,582 Diluted 32,850,497 36,429,714 (a) Represents share-based compensation relating to equity awards granted primarily to employees and independent directors of the Company.
The following table summarizes key components of our results of operations for the periods indicated: 33 Index Year Ended December 31, (in thousands, except for share data) 2023 2022 2021 Revenues: Wire transfer and money order fees, net $ 561,540 $ 469,162 $ 393,241 Foreign exchange gain, net 87,908 72,920 62,832 Other income 9,287 4,723 3,133 Total revenues 658,735 546,805 459,206 Operating expenses: Service charges from agents and banks 430,865 364,804 307,458 Salaries and benefits 71,090 52,224 43,065 Other selling, general and administrative expenses 47,979 34,394 30,334 Transaction costs 445 3,005 1,006 Depreciation and amortization 12,866 9,470 9,491 Total operating expenses 563,245 463,897 391,354 Operating income 95,490 82,908 67,852 Interest expense 10,426 5,629 4,537 Income before income taxes 85,064 77,279 63,315 Income tax provision 25,549 19,948 16,472 Net income $ 59,515 $ 57,331 $ 46,843 Earnings per common share: Basic $ 1.67 $ 1.52 $ 1.22 Diluted $ 1.63 $ 1.48 $ 1.20 Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022 Revenues Revenues for the above periods are presented below: Year Ended December 31, ($ in thousands) 2023 % of Revenues 2022 % of Revenues Revenues: Wire transfer and money order fees, net $ 561,540 86 % $ 469,162 86 % Foreign exchange gain, net 87,908 13 % 72,920 13 % Other income 9,287 1 % 4,723 1 % Total revenues $ 658,735 100 % $ 546,805 100 % Wire transfer and money order fees, net of $561.5 million, for the year ended December 31, 2023 increased by $92.3 million, or 19.7%, from $469.2 million for the year ended December 31, 2022.
The following table summarizes key components of our results of operations for the periods indicated: 36 Index Year Ended December 31, (in thousands, except for share data) 2024 2023 2022 Revenues: Wire transfer and money order fees, net $ 554,801 $ 561,540 $ 469,162 Foreign exchange gain, net 88,944 87,908 72,920 Other income 14,904 9,287 4,723 Total revenues 658,649 658,735 546,805 Operating expenses: Service charges from agents and banks 428,968 430,865 364,804 Salaries and benefits 68,247 70,203 52,224 Other selling, general and administrative expenses 47,894 47,652 34,394 Restructuring costs 3,060 1,214 — Transaction costs 1,819 445 3,005 Depreciation and amortization 13,645 12,866 9,470 Total operating expenses 563,633 563,245 463,897 Operating income 95,016 95,490 82,908 Interest expense 11,745 10,426 5,629 Income before income taxes 83,271 85,064 77,279 Income tax provision 24,450 25,549 19,948 Net income $ 58,821 $ 59,515 $ 57,331 Earnings per common share: Basic $ 1.81 $ 1.67 $ 1.52 Diluted $ 1.79 $ 1.63 $ 1.48 Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 Revenues Revenues for the above periods are presented below: Year Ended December 31, ($ in thousands) 2024 % of Revenues 2023 % of Revenues Revenues: Wire transfer and money order fees, net $ 554,801 84 % $ 561,540 86 % Foreign exchange gain, net 88,944 14 % 87,908 13 % Other income 14,904 2 % 9,287 1 % Total revenues $ 658,649 100 % $ 658,735 100 % Wire transfer and money order fees, net of $554.8 million, for the year ended December 31, 2024 decreased by $6.7 million, or 1.2%, from $561.5 million for the year ended December 31, 2023.
Net Income We reported net income of $59.5 million for the year ended December 31, 2023 compared to net income of $57.3 million for the year ended December 31, 2022, which resulted in an increase of $2.2 million due to the same factors discussed above.
Net Income We reported net income of $58.8 million for the year ended December 31, 2024 compared to net income of $59.5 million for the year ended December 31, 2023, which resulted in a decrease of $0.7 million due to the same factors discussed above.
Income tax provision — Income tax provision was $25.5 million for the year ended December 31, 2023, an increase of $5.6 million, or 28.1%, from an income tax provision of $19.9 million for the year ended December 31, 2022.
Income tax provision — Income tax provision was $24.5 million for the year ended December 31, 2024, a decrease of $1.0 million, or 3.9%, from an income tax provision of $25.5 million for the year ended December 31, 2023.
(b) Represents primarily severance, write-off of fixed assets and professional fees related to the restructuring of La Nacional. (c) Represents primarily financial advisory, professional and legal fees related to business acquisition transactions. (d) Represents losses related to the closure of a financial institution in Mexico during 2021. (e) Represents primarily loss on disposal of fixed assets.
(b) Represents primarily severance, write-off of assets and, legal and professional fees related to the execution of restructuring plans. (c) Represents primarily financial advisory, professional and legal fees related to business acquisition transactions and strategic alternatives. (d) Represents a gain contingency related to a legal settlement. (e) Represents primarily loss on disposal of fixed assets.
(b) Represents primarily severance, write-off of fixed assets and professional fees related to the restructuring of La Nacional. (c) Represents primarily financial advisory, professional and legal fees related to business acquisition transactions. (d) Represents losses related to the closure of a financial institution in Mexico during 2021. (e) Represents primarily loss on disposal of fixed assets.
(b) Represents primarily severance, write-off of assets, and legal and professional fees related to the execution of restructuring plans. (c) Represents primarily financial advisory, professional and legal fees related to business acquisition transactions and strategic alternatives. (d) Represents a gain contingency related to a legal settlement. (e) Represents primarily loss on disposal of fixed assets.
Other selling, general and administrative expenses — Other selling, general and administrative expenses of $48.0 million for the year ended December 31, 2023 increased by $13.6 million, or 39.5%, from $34.4 million for the year ended December 31, 2022.
Other selling, general and administrative expenses — Other selling, general and administrative expenses of $47.9 million for the year ended December 31, 2024 increased by $0.2 million, or 0.4%, from $47.7 million for the year ended December 31, 2023.
The increase was primarily due to higher market interest rates paid under our A&R Credit Agreement, as well as higher and more frequent draws under our revolving credit facility during the year ended December 31, 2023.
The increase was primarily due to higher market interest rates during the first half of 2024, partially offset by lower rates under our Second A&R Credit Facility during the second half of 2024, as well as higher and more frequent draws under our revolving credit facility to fund our working capital needs during the year ended December 31, 2024.
The following table presents the reconciliation of Net Income, our closest GAAP measure, to Adjusted EBITDA: 39 Index Year Ended December 31, (in thousands) 2023 2022 Net Income $ 59,515 $ 57,331 Adjusted for: Interest expense 10,426 5,629 Income tax provision 25,549 19,948 Depreciation and amortization 12,866 9,470 EBITDA 108,356 92,378 Share-based compensation (a) 8,111 7,118 Restructuring costs (b) 1,214 — Transaction costs (c) 445 3,005 Loss on bank closure (d) — 1,583 Other charges and expenses (e) 1,850 1,141 Adjusted EBITDA $ 119,976 $ 105,225 (a) Represents shared-based compensation relating to equity awards granted primarily to employees and independent directors of the Company.
The following table presents the reconciliation of Net Income, our closest GAAP measure, to Adjusted EBITDA: 42 Index Year Ended December 31, (in thousands) 2024 2023 Net Income $ 58,821 $ 59,515 Adjusted for: Interest expense 11,745 10,426 Income tax provision 24,450 25,549 Depreciation and amortization 13,645 12,866 EBITDA 108,661 108,356 Share-based compensation (a) 7,043 8,111 Restructuring costs (b) 3,060 1,214 Transaction costs (c) 1,819 445 Legal contingency settlement (d) (570) — Other charges and expenses (e) 1,239 1,850 Adjusted EBITDA $ 121,252 $ 119,976 (a) Represents share-based compensation relating to equity awards granted primarily to employees and independent directors of the Company.
Operating Expenses Operating expenses for the above periods are presented below: Year Ended December 31, ($ in thousands) 2023 % of Revenues 2022 % of Revenues Operating expenses: Service charges from agents and banks $ 430,865 65 % $ 364,804 67 % Salaries and benefits 71,090 11 % 52,224 10 % Other selling, general and administrative expenses 47,979 7 % 34,394 6 % Transaction costs 445 NM 3,005 1 % Depreciation and amortization 12,866 2 % 9,470 2 % Total operating expenses $ 563,245 86 % $ 463,897 85 % NM - Amounts rounds to less than 1%.
Operating Expenses Operating expenses for the above periods are presented below: Year Ended December 31, ($ in thousands) 2024 % of Revenues 2023 % of Revenues Operating expenses: Service charges from agents and banks $ 428,968 65 % $ 430,865 65 % Salaries and benefits 68,247 10 % 70,203 11 % Other selling, general and administrative expenses 47,894 7 % 47,652 7 % Restructuring costs 3,060 NM 1,214 NM Transaction costs 1,819 NM 445 NM Depreciation and amortization 13,645 2 % 12,866 2 % Total operating expenses $ 563,633 86 % $ 563,245 86 % NM - Amounts rounds to less than 1%.
We have encountered and continue to expect to encounter increasing competition as new electronic platforms emerge that enable consumers to send and receive money through a variety of channels, but we do not expect adoption rates to be as significant in the near 31 Index term for the consumer segment we serve.
We have encountered and continue to expect to encounter increasing competition as new electronic platforms emerge that enable consumers to send and receive money through a variety of channels.
A portion of these expenses relate to our Company-operated stores; however, the majority relate to the overall business and compliance requirements of a regulated publicly traded financial services company. Selling expenses include expenses such as advertising and promotion, shipping, supplies and other expenses associated with serving and increasing our network of sending agents.
A portion of these expenses relate to our Company-operated stores; however, the majority relate to the overall business and compliance requirements of a regulated publicly traded financial services company.
Corporate employees include management, customer service, compliance, information technology, operations, finance, legal and human resources. Our sales team, located throughout the United States, Canada, Spain and Italy, is focused on supporting and growing our sending agent network.
Our sales team, located throughout the United States, Canada, Spain and Italy, is focused on supporting and growing our sending agent network.
The following table presents the reconciliation of GAAP Earnings per Share, our closest GAAP measure, to Adjusted Earnings per Share: Year Ended December 31, 2023 2022 Basic Diluted Basic Diluted GAAP Earnings per Share $ 1.67 $ 1.63 $ 1.52 $ 1.48 Adjusted for: Share-based compensation $ 0.23 $ 0.22 $ 0.19 $ 0.18 Restructuring costs $ 0.03 $ 0.03 $ — $ — Transaction costs $ 0.01 $ 0.01 $ 0.08 $ 0.08 Loss on bank closure $ — $ — $ 0.04 $ 0.04 Other charges and expenses $ 0.05 $ 0.05 $ 0.03 $ 0.03 Amortization of intangibles $ 0.13 $ 0.13 $ 0.11 $ 0.11 Income tax benefit related to adjustments $ (0.14) $ (0.13) $ (0.12) $ (0.11) Adjusted Earnings per Share $ 1.99 $ 1.95 $ 1.85 $ 1.81 The table above may contain slight summation differences due to rounding.
The increase in Adjusted Earnings per Share - Diluted was primarily due to the effect of a lower weighted average common shares total for the year due to stock repurchases combined with the higher net effect of the adjusting items detailed in the table above, partially offset by lower net income for the year. 41 Index The following table presents the reconciliation of GAAP Earnings per Share, our closest GAAP measure, to Adjusted Earnings per Share: Year Ended December 31, 2024 2023 Basic Diluted Basic Diluted GAAP Earnings per Share $ 1.81 $ 1.79 $ 1.67 $ 1.63 Adjusted for: Share-based compensation $ 0.22 $ 0.21 $ 0.23 $ 0.22 Restructuring costs $ 0.09 $ 0.09 $ 0.03 $ 0.03 Transaction costs $ 0.06 $ 0.06 $ 0.01 $ 0.01 Legal contingency settlement $ (0.02) $ (0.02) $ — $ — Other charges and expenses $ 0.04 $ 0.04 $ 0.05 $ 0.05 Amortization of intangibles $ 0.12 $ 0.12 $ 0.13 $ 0.13 Income tax benefit related to adjustments $ (0.15) $ (0.15) $ (0.14) $ (0.13) Adjusted Earnings per Share $ 2.17 $ 2.14 $ 1.99 $ 1.95 The table above may contain slight summation differences due to rounding.
Operating lease expenses were $7.8 million for the year ended December 31, 2023. We have not entered into finance lease commitments. For additional information on operating lease obligations, refer to Part II, Item 8, Financial Statements and Supplementary Data, Note 8, “ Leases ”.
For additional information on operating lease obligations, refer to Part II, Item 8, Financial Statements and Supplementary Data, Note 8, “ Leases ”.
For additional information on these acquisitions, see Note 3 to the consolidated financial statements. Depreciation and Amortization 32 Index Depreciation and amortization largely consists of depreciation of computer equipment and amortization of software that supports our technology platform. In addition, it includes amortization of intangible assets primarily related to our agent relationships, trade names and developed technology.
Transaction costs also include internal and external costs related to the Board’s evaluation of strategic alternatives. Depreciation and Amortization Depreciation and amortization largely consists of depreciation of computer equipment and amortization of software that supports our technology platform. In addition, it includes amortization of intangible assets primarily related to our agent relationships, trade names and developed technology.
Service charges vary based on agent commission percentages and the amount of fees charged by the banks. Sending agents earn a commission on each transaction they process of approximately 50% of the transaction fee. Service charges may increase if banks or payer organizations increase their fee structure or sending agents use higher fee methods to remit funds to us.
Service charges may increase if banks, processors and payer organizations increase their fee structure or sending agents use higher fee methods to remit funds to us. Service charges also vary based on the method the consumer selects to send the transfer and the payer organization that facilitates the transaction.
Other income of $9.3 million for the year ended December 31, 2023 increased by $4.6 million or 97.9% from $4.7 million for the year ended December 31, 2022, primarily due to the impact of the revenue generated from other ancillary services provided by La Nacional and LAN Holdings to a particular segment of their consumers and commercial customers, an increase in fees related to higher volume of transfers deemed abandoned property, fees related to advances to sending agents and an increase in income related to money transfer transactions paid with debit or credit cards.
Other income of $14.9 million for the year ended December 31, 2024 increased by $5.6 million or 60.2% from $9.3 million for the year ended December 31, 2023, primarily due to the effect of higher revenue generated from other ancillary services provided by our Company-operated stores such as check-cashing fees, higher revenues primarily as a result of an increase of the base fees charged on money transfers and money orders deemed abandoned property, and higher fees related to our wires as a service relationships, as well as an increase in income related to money transfer transactions paid with debit or credit cards.
In addition, our services are offered digitally through Intermexonline.com, online.i-transfer.es and via Internet-enabled mobile devices. For the year ended December 31, 2023, we grew our agent network by approximately 16.4% primarily due to the agents added as a result of the acquisition of LAN Holdings, partially offset by the termination of low volume and unproductive sending agents.
In addition, our services are offered digitally through the Internet via our websites (intermexonline.com and online.i-transfer.es) and mobile device applications. For the year ended December 31, 2024, our agent network decreased slightly by approximately 0.2%, primarily as a result of a lower number of sending agents onboarded during the year relative to ordinary course agent terminations.
Salaries and benefits — Salaries and benefits were $71.1 million for the year ended December 31, 2023, an increase of $18.9 million, or 36.2%, from $52.2 million for the year ended December 31, 2022.
Salaries and benefits — Salaries and benefits were $68.2 million for the year ended December 31, 2024, a decrease of $2.0 million, or 2.8%, from $70.2 million for the year ended December 31, 2023.
Transaction costs for the year ended December 31, 2023 primarily related to the LAN Holdings acquisition, while transaction costs for the year ended December 31, 2022 related to costs incurred in connection with both the La Nacional and LAN Holdings acquisitions.
Transaction costs for the year ended December 31, 2024 primarily related to the Company's evaluation of strategic alternatives, while transaction costs for the year ended December 31, 2023 primarily related to the LAN Holdings acquisition.
This increase in cash used was primarily due to the acquisition of LAN Holdings through a cash transaction, which resulted in $5.5 million of cash used, net of cash acquired.
This increase in cash used was primarily due to the acquisitions of the Amigo Paisano brands and a money remittance Company in the United Kingdom through cash transactions, which resulted in $13.2 million of cash used, net of cash acquired.
The effective interest rates for the year ended December 31, 2023 for the term loan facility and revolving credit facility, which related to the Company’s A&R Credit Agreement (as defined herein), were 8.33% and 1.92%, respectively. Income tax provision Our income tax provision includes the expected benefit of all deferred tax assets, including our net operating loss carryforwards.
The effective interest rates for the year ended December 31, 2024 for the term loan facility and revolving credit facility, which related to the Company’s A&R Credit Agreement and Second A&R Credit Agreement (each, as defined herein), were 9.02% and 2.51%, respectively.
The increase is the result of a $1.7 million increase in depreciation associated with additional software internally developed and computer equipment to support our growing business and sending agent network, as well as approximately $1.2 million of depreciation for assets assumed in the La Nacional and LAN Holdings acquisitions and approximately $1.9 million for amortization of intangibles resulting from the La Nacional and LAN Holdings acquisitions.
The increase is the result of higher depreciation associated with additional software developed and computer equipment acquired to support our growing business and sending agent network, as well as depreciation related to assets capitalized in connection with the Company’s new headquarters.
Service charges from agents and banks — Service charges from agents and banks were $430.9 million for the year ended December 31, 2023 compared to $364.8 million for the year ended December 31, 2022. The increase of $66.1 million, or 18.1%, was primarily due to the increase in transaction volume described above.
Service charges from agents and banks — Service charges from agents and banks were $429.0 million for the year ended December 31, 2024 compared to $430.9 million for the year ended December 31, 2023.
With few exceptions, our net operating loss carryforwards will expire from 2029 through 2043.
Income tax provision Our income tax provision includes the expected benefit of all deferred tax assets, including our net operating loss carryforwards. With few exceptions, our net operating loss carryforwards will expire from 2029 through 2044.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe increase in our provision for credit losses in the year ended December 31, 2023 is due to a combination of higher write-offs of accounts receivable in 2023 compared to 2022 primarily as a result of sending agents that were not able to pay in accordance with the original terms and are, accordingly, subject to our normal collection procedures and higher outstanding balances of accounts receivable primarily related to the acquisition of La Nacional and LAN Holdings. 45 Index
Biggest changeThe increase in our provision for credit losses in the year ended December 31, 2024 is primarily due to higher outstanding balances of accounts receivable primarily related to the acquisition of La Nacional and LAN Holdings and higher volume growth processed by our sending agents. 48 Index
During the year ended December 31, 2023, we did not incur any losses on these uninsured accounts. To manage our exposure to credit risk with respect to cash balances and other credit risk exposure resulting from our relationships with banks and financial institutions, we regularly review cash concentrations, and we attempt to diversify our cash balances among global financial institutions.
During the year ended December 31, 2024, we did not incur any losses on these uninsured accounts. To manage our exposure to credit risk with respect to cash balances and other credit risk exposure resulting from our relationships with banks and financial institutions, we regularly review cash concentrations, and we attempt to diversify our cash balances among global financial institutions.
This foreign currency risk is related primarily to our operations in our foreign subsidiaries. Revenues from our foreign subsidiaries represents approximately 2% of our consolidated revenues for the year ended December 31, 2023. Therefore, a 10% increase or decrease in these currency rates against the U.S. Dollar would result in a de minimis change to our overall operating results.
This foreign currency risk is related primarily to our operations in our foreign subsidiaries. Revenues from our foreign subsidiaries represents approximately 3% of our consolidated revenues for the year ended December 31, 2024. Therefore, a 10% increase or decrease in these currency rates against the U.S. Dollar would result in a de minimis change to our overall operating results.
We are also exposed to credit risk related to receivable balances from sending agents. We perform a credit review before each agent signing and conduct ongoing analyses of sending agents and certain other parties we transact with directly. As of December 31, 2023, we also had $4.6 million outstanding of agent advances receivable from sending agents.
We are also exposed to credit risk primarily related to receivable balances from sending agents and digital partners. We perform a credit review before each agent signing and conduct ongoing analyses of sending agents and certain other parties we transact with directly. As of December 31, 2024, we also had $4.6 million outstanding of agent advances receivable from sending agents.
(2) Average exchange rates are for the years ended December 31, 2023, 2022 and 2021. (3) We commenced operations in the Dominican Republic and Europe in connection with the LAN Acquisition in April 2023 and, therefore, no information is provided prior to 2023.
(2) Average exchange rates are for the years ended December 31, 2024, 2023 and 2022. (3) We commenced operations in the Dominican Republic and Europe in connection with the acquisition of LAN Holdings, Corp. in April 2023 and, therefore, no information is provided prior to 2023.
Our provision for credit losses was approximately $5.0 million for the year ended December 31, 2023 (0.8% of total revenues), $2.6 million for the year ended December 31, 2022 (0.5% of total revenues) and $1.5 million for the year ended December 31, 2021 (0.3% of total revenues).
Our provision for credit losses was approximately $6.4 million for the year ended December 31, 2024 (1.0% of total revenues), $5.0 million for the year ended December 31, 2023 (0.8% of total revenues) and $2.6 million for the year ended December 31, 2022 (0.5% of total revenues).
Also, included in prepaid wires, net in our consolidated balance sheets as of December 31, 2023 and 2022, there are $17.8 million and $82.3 million, respectively, of prepaid wires denominated in foreign currencies, primarily in Mexican pesos and Guatemalan quetzales.
Also, included in prepaid wires, net in our consolidated balance sheets as of December 31, 2024 and 2023, there are $29.8 million and $17.8 million, respectively, of prepaid wires denominated in foreign currencies, primarily in Mexican pesos and Guatemalan quetzales.
In addition, included in wire transfers and money orders payable, net in our consolidated balance sheets as of December 31, 2023 and 2022, there are $40.7 million and $39.3 million, respectively, of wire transfers payable denominated in foreign currencies, primarily in Mexican pesos and Guatemalan quetzales.
In addition, included in wire transfers and money orders payable, net in our consolidated balance sheets as of December 31, 2024 and 2023, there are $23.0 million and $40.7 million, respectively, of wire transfers payable denominated in foreign currencies, primarily in Mexican pesos and Guatemalan quetzales.
The Company had open tom and spot foreign exchange contracts for Mexican pesos and Guatemalan quetzales amounting to approximately $56.9 million and $41.3 million at December 31, 2023 and 2022, respectively.
The Company had open tom and spot foreign exchange contracts for Mexican pesos and Guatemalan quetzales amounting to approximately $12.7 million and $56.9 million at December 31, 2024 and 2023, respectively.
The spot and average exchange rates for the currencies used by our subsidiaries to U.S. dollar are as follows: 2023 2022 2021 Spot (1) Average (2) Spot (1) Average (2) Spot (1) Average (2) U.S. dollar/Mexico peso 16.89 17.72 19.40 20.09 20.50 20.27 U.S. dollar/Guatemala quetzal 7.81 7.82 7.85 7.73 7.71 7.73 U.S. dollar/Canadian dollar 1.32 1.35 1.36 1.30 1.28 1.25 U.S. dollar/Dominican peso (3) 58.04 55.76 — — — — U.S. dollar/Euro (3) 0.91 0.92 — — — — 44 Index (1) Spot exchange rates are as of December 31, 2023, 2022 and 2021.
The spot and average exchange rates for the currencies used by our subsidiaries to U.S. dollar are as follows: 47 Index 2024 2023 2022 Spot (1) Average (2) Spot (1) Average (2) Spot (1) Average (2) U.S. dollar/Mexico peso 20.75 18.30 16.89 17.72 19.40 20.09 U.S. dollar/Guatemala quetzal 7.68 7.74 7.81 7.82 7.85 7.73 U.S. dollar/Canadian dollar 1.44 1.37 1.32 1.35 1.36 1.30 U.S. dollar/Dominican peso (3) 61.10 59.43 58.04 55.76 — — U.S. dollar/Euro (3) 0.96 0.92 0.91 0.92 — — U.S. dollar/British Pound Sterling (4) 0.80 0.77 — — — — (1) Spot exchange rates are as of December 31, 2024, 2023 and 2022.
Credit Risk We maintain certain cash balances in various U.S. banks, which at times, may exceed federally insured limits. We have not incurred any losses on these accounts. In addition, we maintain cash in various bank accounts in Mexico, Guatemala, Canada, the Dominican Republic, Spain and Italy and overnight deposit accounts in Mexico, which may not be fully insured.
We have not incurred any losses on these accounts. In addition, we maintain cash in various bank accounts in Mexico, Guatemala, Canada, the Dominican Republic, Spain, the United Kingdom, Germany and Italy and short-term investment accounts in Mexico, which may not be fully insured.
A hypothetical 1% increase or decrease in the interest rate on our indebtedness as of December 31, 2023 would have increased or decreased annual cash interest expense on our term loan facility and revolving credit facility by approximately $0.8 million and $1.1 million per annum, respectively.
A hypothetical 1% increase or decrease in the interest rate on our indebtedness as of December 31, 2024 would have increased or decreased cash interest expense on our revolving credit facility by approximately $1.6 million per annum, respectively. Credit Risk We maintain certain cash balances in various U.S. banks, which at times, may exceed federally insured limits.
The Company expects that the Federal Reserve will continue to monitor inflation indicators and will maintain the fed funds rate at the current level before considering any potential decreases in 2024. As of December 31, 2023, we had $75.5 million and $114.0 million in outstanding borrowings under the term loan facility and revolving credit facility, respectively.
The Company expects that the Federal Reserve will continue to monitor inflation and other economic indicators to assess if additional interest rate decreases in 2025 are warranted. As of December 31, 2024, we had $156.6 million in outstanding borrowings under the revolving credit facility.
Because interest expense is subject to fluctuation, if interest rates increase, our debt service obligations on such variable rate indebtedness would increase even though the amount borrowed remained the same. Accordingly, an increase in interest rates would adversely affect our profitability.
Interest Rate Risk As discussed above, interest under the Second A&R Credit Agreement is variable based on certain benchmark rates, including SOFR, EURIBOR and SONIA. Because interest expense is subject to fluctuation, if interest rates increase, our debt service obligations on such variable rate indebtedness would increase even though the amount borrowed may remain the same.
During the year ended December 31, 2023, the Federal Reserve continued raising the fed funds rate from 4.50% to 5.50% as a countermeasure to control inflation in the United States. As a consequence, other benchmark interest rates such as SOFR increased as well. These increases have resulted in the Company incurring higher interest expense.
Accordingly, an increase in interest rates would adversely affect our profitability. During the year ended December 31, 2024, the Federal Reserve lowered the fed funds rate from 5.50% to 4.50% to ease monetary policy and support economic stability. As a consequence, other benchmark interest rates such as SOFR started to decrease during the second half of the year as well.
During the year ended December 31, 2023, the Company funded advances of approximately $3.2 million to agents that deliver highly accretive transaction volume and margin growth. Most of the agent advances receivable are collateralized by personal guarantees from the sending agents and by assets from their businesses and have a term of up to three years.
Most of the agent advances receivable are collateralized by personal guarantees from the sending agents and by assets from their businesses.
Long-term sustained appreciation of the Mexican peso or Guatemalan quetzal as compared to the U.S. dollar could affect our gross profit and margin. Interest Rate Risk As discussed above, interest under the Credit Agreement is variable based on certain benchmark rates, including SOFR.
(4) We commenced operations in the United Kingdom in connection with an acquisition of a money service entity in July 2024 and, therefore, no information is provided prior to 2024. Long-term sustained appreciation of the Mexican peso or Guatemalan quetzal as compared to the U.S. dollar could affect our gross profit and margin.

Other IMXI 10-K year-over-year comparisons