MoneyGram International Reports Fourth Quarter and Full Year 2012 Financial Results

  MoneyGram International Reports Fourth Quarter and Full Year 2012 Financial
  Results

 Strong full-year and fourth quarter money transfer constant currency revenue
           growth of 13 percent on transaction growth of 14 percent

                    Global agent network surpasses 310,000

Business Wire

DALLAS -- February 6, 2013

MoneyGram International, Inc. (NYSE:MGI), a leading global payment services
company, reported financial results for the fourth quarter and full year ended
December 31, 2012.

Full year highlights:

  *Total revenue was $1,341.2 million, an increase of 7 percent over the
    prior year.

       *Total fee and other revenue increased 8 percent to $1,328.6 million
         from $1,230.9 million in the prior year.
       *Money transfer fee and other revenue increased 10 percent over the
         prior year to $1,148.5 million, and increased 13 percent on a
         constant currency basis.

  *Money transfer transaction volume increased 14 percent over the prior
    year, led by:

       *18 percent growth in sends originated outside of the U.S.
       *13 percent growth in U.S. outbound on the strength of U.S.-to-Mexico
         sends, which grew 21 percent
       *10 percent growth in U.S.-to-U.S. sends.

  *Adjusted EBITDA increased 6 percent to $278.9 million and in constant
    currency adjusted EBITDA increased 8 percent to $283.8 million. Adjusted
    EBITDA margin was 20.8 percent, down from 21.1 percent in the prior year.
    Adjusted EBITDA was negatively impacted by $4.9 million related to a lower
    euro valuation against the U.S. dollar compared to the prior year, $4.3
    million from lower investment revenue, and $4.0 million from higher
    compliance related investments.
  *The Company reported EBITDA of $139.9 million and a net loss of ($49.3)
    million. Both EBITDA and net loss were primarily impacted by:

       *$100.0 million forfeiture related to the settlement of the
         investigation by the U.S. Attorney’s Office for the Middle District
         of Pennsylvania (“MDPA”)
       *$19.2 million of legal expenses primarily related to the MDPA
         settlement and the settled shareholder lawsuit
       *$19.3 million of restructuring and reorganization costs
       *$10.0 million in gains from the sale of securities previously written
         down
       *$9.2 million of stock-based compensation expense
       *$1.0 million of severance and related costs.

  *Diluted loss per common share was ($0.69), including a negative $1.58 per
    share impact due to the aforementioned forfeiture and legal expenses, a
    negative $0.17 per share impact from restructuring and reorganization
    costs, a negative $0.08 per share impact from stock-based compensation,
    offset by a $0.09 per share benefit from gains on the sales of securities
    previously written down.

Fourth quarter highlights:

  *Total revenue was $354.4 million, an increase of 10 percent over the prior
    year.

       *Total fee and other revenue increased 10 percent to $351.3 million,
         from $318.7 million in the prior year.
       *Money transfer fee and other revenue increased 12 percent over the
         prior year to $306.9 million, and increased 13 percent on a constant
         currency basis.

  *Money transfer transaction volume increased 14 percent over the prior
    year, led by:

       *18 percent growth in sends originated outside of the U.S.
       *15 percent growth in U.S. outbound on the strength of U.S.-to-Mexico
         sends, which grew 24 percent
       *9 percent growth in U.S.-to-U.S. sends.

  *During the quarter, 36 percent of money transfer transactions originated
    outside of the U.S., 34 percent were U.S. outbound and 30 percent were
    U.S.-to-U.S. For money transfer revenue, 47 percent was from transactions
    originated outside of the U.S., 28 percent was U.S. outbound and 25
    percent was U.S.-to-U.S.
  *The bill payment business showed 3 percent transaction growth driven by
    new channel expansion and revenue declined 2 percent over the prior year,
    excluding the PropertyBridge divestiture.
  *Global agent locations increased 16 percent to more than 310,000.
  *Adjusted EBITDA increased 7 percent to $71.7 million and in constant
    currency, adjusted EBITDA increased 8 percent to $72.3 million. Adjusted
    EBITDA margin was 20.2 percent, down from 20.9 percent for the same period
    last year. Adjusted EBITDA was negatively impacted by higher compensation
    and benefits expense, along with the items that negatively impacted
    adjusted EBITDA for the full year.
  *For the quarter EBITDA was $71.3 million and net income was $20.2 million.
    Both EBITDA and net income were impacted by $10.0 million in gains from
    the sale of securities previously written down, $5.1 million of
    restructuring and reorganization costs, $3.7 million of legal expenses
    related to the MDPA investigation and the settled shareholder lawsuit, and
    $1.6 million of stock-based compensation.
  *Diluted income per common share was $0.28, including a $0.09 per share
    benefit from gains on the sales of securities previously written down, a
    negative $0.03 per share impact due to the legal expenses, a negative
    $0.04 per share impact from restructuring and reorganization costs, and a
    negative $0.01 per share impact from stock-based compensation.

“We are very pleased with our accomplishments in 2012. In spite of a weak
global economy and a competitive environment, we continued to excel, achieving
double-digit growth in money transfer transaction volume, constant currency
revenue, and agent locations. We delivered strong free cash flow while
investing in our business for long-term growth,” said Pamela H. Patsley,
chairman and chief executive officer. “MoneyGram is well positioned in a
dynamic growing industry, one that provides a valuable service to the billions
of unbanked and underbanked consumers worldwide. Our business is resilient and
we have a talented team committed to ensuring that MoneyGram remains a leader
in the global financial services industry.”

Balance Sheet

MoneyGram ended the year with assets in excess of payment service obligations
of $227.9 million, and outstanding debt principal of $809.9 million. Interest
expense for the year was $70.9 million, down $15.3 million from the prior year
as a result of refinancing activities. Income tax expense for the year was
$40.4 million, with $2.9 million in cash tax payments.

Cash Flow

Free cash flow for the quarter was $23.4 million, up 16 percent from the prior
year. For the full year, free cash flow was $115.0 million, up 9 percent from
the prior year period. This was driven by strong money transfer results and
lower interest payments, partially offset by higher capital expenditures and
signing bonuses.

Market Developments

  *Signed a five-year exclusive contract with Tesco Bank to provide MoneyGram
    money transfer services in up to 800 Tesco store locations across the U.K.
    and the Republic of Ireland.
  *Entered into an agreement with Dollar General to provide our MoneyGram
    in-lane  service at its 10,000 stores, further expanding our U.S. agent
    network to approximately 50,000 locations.
  *Grew self-service and new channel revenue by 50 percent in 2012, which
    represented 5 percent of money transfer revenue.
  *Expanded our relationship with Movistar Remesas, a leading Spanish
    remittance company, giving our customers in Spain the ability to now send
    money from their mobile phones to any MoneyGram location.
  *Other network expansion activities during the quarter:

       *Completed the roll-out of Continente, Portugal’s largest retailer
         with 140 locations and approximately 180 million visits per year
       *Signed a home delivery contract with Banco Union, allowing more
         convenient money transfer services in the Dominican Republic
       *Crossed the 20,000 location milestone in Africa, and announced
         Casablanca as a regional hub
       *Continued to expand our network locations across Australia through
         the signing of PFG Money, a leading distributor of remittance
         services in Australia
       *Signed Svyaznoy, an independent phone retailer in Russia, which will
         further expand our services to the retail sector in Russia
       *Signed Orange Romania, the largest telecommunications operator in
         Romania with 100 locations and more than 10 million customers
       *Added 12 financial institutions in the U.S. to offer our money
         transfer and bill payment services
       *Continued our bill pay portfolio expansion and added more than 600
         new billers

Global Funds Transfer Segment Results

For the quarter, total revenue was up 11 percent to $332.9 million and money
transfer fee and other revenue increased 12 percent to $306.9 million. On a
constant currency basis money transfer  fee and other revenue increased 13
percent, the Company’s seventh consecutive quarter of double-digit growth.

Bill payment transaction volume in the quarter increased 1 percent, while fee
and other revenue decreased 3 percent to $26.0 million from the fourth quarter
of 2011. Excluding the fourth quarter 2011 divestiture, transactions increased
3 percent and fee and other revenue decreased 2 percent.

During the quarter, the segment reported operating income of $38.4 million and
operating margin of 11.5 percent. Adjusted operating margin was 13.6 percent
in the quarter, down from 14.0 percent in the prior year due to higher
compensation and benefits expense, higher compliance-related investments, and
lower investment revenue.

For the full year, total revenue was up 9 percent to $1,255.2 million, and
money transfer fee and other revenue increased 10 percent to $1,148.5 million.
On a constant currency basis, money transfer  fee and other revenue increased
13 percent.

Bill payment transaction volume for the year decreased 3 percent, while fee
and other revenue decreased 6 percent to $106.1 million from the prior year.
Excluding the prior year divestiture, transactions increased 5 percent and fee
and other revenue decreased 1 percent.

For the full year, the segment reported operating income of $149.6 million and
operating margin of 11.9 percent. Adjusted operating margin was 14.0 percent,
up from 13.7 percent in the prior year as a result of greater operating
leverage.

Financial Paper Products Segment Results

For the quarter, total revenue was $21.0 million, down 1 percent compared to
the prior year. Operating income was $8.1 million, up from $5.9 million in the
fourth quarter of 2011. Operating margin was 38.6 percent. Adjusted operating
margin was 40.5 percent in the quarter, up from 33.3 percent in the same
period last year.

For the full year, total revenue was $84.5 million, down 9 percent compared to
the prior year. Operating income was $32.7 million, up from $29.2 million in
the prior year. Operating margin was 38.7 percent and adjusted operating
margin was 41.4 percent, up from 36.3 percent in the prior year. Segment
margins benefitted from a lower rate of decline in investible balances.

Outlook

For fiscal year 2013, management is estimating total constant currency revenue
growth of 6 percent to 9 percent and constant currency adjusted EBITDA growth
of 3 percent to 6 percent.

“We remain committed to achieving double-digit money transfer transaction
growth and increasing our free cash flow. This outlook reflects continuing our
investment in products, systems and services for the long-term yet allows us
to absorb short-term industry pricing moves. We are very pleased with our
results even after the pricing environment changed, and therefore, we have not
yet implemented many of the pricing changes contemplated in our outlook,” said
Patsley. “We have the right strategy to continue to capture share in a dynamic
and growing global financial services industry. MoneyGram’s compelling
products and services are relevant to the needs of an expanding consumer base.
We are optimistic about 2013.”

Non-GAAP Measures

In addition to results presented in accordance with GAAP, this press release
and related tables include certain non-GAAP financial measures, including a
presentation of EBITDA (earnings before interest, taxes, depreciation and
amortization, including agent signing bonus amortization), Adjusted EBITDA
(EBITDA adjusted for significant items), Adjusted EBITDA Margin and Free Cash
Flow (Adjusted EBITDA less cash interest expense, cash tax expense, cash
payments for capital expenditures and agent signing bonuses). In addition, we
also present Adjusted Operating Income and Adjusted Operating Margin for our
two reporting segments. The following tables include a full reconciliation of
these non-GAAP financial measures to the related GAAP financial measures.

We believe that these non-GAAP financial measures provide useful information
to investors because they are an indicator of the strength and performance of
ongoing business operations, including our ability to service debt and fund
capital expenditures, acquisitions and operations. These calculations are
commonly used as a basis for investors, analysts and credit rating agencies to
evaluate and compare the operating performance and value of companies within
our industry. In addition, the Company’s debt agreements require compliance
with financial measures based on EBITDA and Adjusted EBITDA. Finally, EBITDA,
Adjusted EBITDA, Adjusted EBITDA Margin and Free Cash Flow are financial
measures used by management in reviewing results of operations, forecasting,
assessing cash flow and capital, allocating resources or establishing employee
incentive programs. Although MoneyGram believes the above non-GAAP financial
measures enhance investors’ understanding of its business and performance,
these non-GAAP financial measures should not be considered an exclusive
alternative to accompanying GAAP financial measures.

Description of Tables

Table One – Consolidated Statements of Income (Loss)
Table Two – Segment Results
Table Three – Segment Reconciliations
Table Four – EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin
Table Five – Consolidated Balance Sheets
Table Six – Assets in Excess of Payment Service Obligations
Table Seven – Free Cash Flow

Conference Call

MoneyGram International will host a conference call today at 9 a.m. ET, 8 a.m.
CT, to discuss its fourth quarter results. Pamela H. Patsley, chairman and
chief executive officer, will host the call.The conference call can be
accessed by calling 1-800-946-0785 (U.S.) and +1-719-325-2115(International).
The participant code is 7174726. Slides are available on MoneyGram’s website
at moneygram.com. A replay of the conference call will be available at noon ET
on February 6, 2013 through 11:59 p.m. ET on February 13, 2013. The replay of
the call is available at 1-877-870-5176 (U.S.) or +1-858-384-5517
(International). The replay participant code is 7174726.

About MoneyGram International, Inc.

MoneyGram, a leading money transfer company, enables consumers who are not
fully served by traditional financial institutions to meet their financial
needs. MoneyGram offers bill payment services in the United States and Canada
and money transfer services worldwide through a global network of more than
310,000 agent locations – including retailers, international post offices and
financial institutions – in 197 countries and territories. To learn more about
money transfer or bill payment at an agent location or online, please visit
moneygram.com or connect with us on Facebook.

Forward-Looking Statements

This release may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including statements with
respect to, among other things, the financial condition, results of
operations, plans, objectives, future performance and business of MoneyGram
and its subsidiaries. Forward-looking statements can be identified by words
such as “believes,” “estimates,” “expects,” “projects,” “plans,” “will,”
“should,” “could,” “would” and other similar expressions. These
forward-looking statements speak only as of the date they are made, and
MoneyGram undertakes no obligation to publicly update or revise any
forward-looking statement, except as required by federal securities law. These
forward-looking statements are based on management’s current expectations and
are subject to certain risks, uncertainties and changes in circumstances due
to a number of factors. These factors include, but are not limited to: our
ability to compete effectively; our ability to maintain key agent, Global
Funds Transfer agent or biller relationships, or a reduction in transaction
volume from these relationships; our ability to manage fraud risks from
consumers or agents; the ability of us and our agents to comply with U.S. and
international laws and regulations, including the Dodd-Frank Wall Street
Reform and Consumer Protection Act of 2010; litigation or investigations
involving MoneyGram or its agents, including the outcome of ongoing
investigations by several state governments, which could result in material
settlements, fines or penalties; uncertainties relating to compliance with and
the impact of the deferred prosecution agreement entered into with the U.S.
federal government and the effect of the deferred prosecution agreement on the
Company’s reputation and business; our offering of money transfer services
through agents in regions that are politically volatile or, in a limited
number of cases, are subject to certain restrictions by the Office of Foreign
Assets Control; changes in tax laws or an unfavorable outcome with respect to
the audit of our tax returns or tax positions, or a failure by us to establish
adequate reserves for tax events; our substantial debt service obligations,
significant debt covenant requirements and credit rating; sustained financial
market illiquidity, or illiquidity at our clearing, cash management and
custodial financial institutions; the ability of MoneyGram and its agents to
maintain adequate banking relationships; concerns regarding the European debt
crisis; a security or privacy breach in our facilities, networks or databases;
disruptions to our computer network systems and data centers; continued
weakness in economic conditions, in both the United States and global markets;
weakened consumer confidence in our business or money transfers generally; a
significant change, material slow down or complete disruption of international
migration patterns; our ability to manage credit risks from our retail agents
and official check financial institution customers; our ability to retain
partners to operate our official check and money order businesses; our ability
to successfully develop and timely introduce new and enhanced products and
services or investments in unsuccessful new products, services or
infrastructure changes; our ability to manage risks associated with our
international sales and operations; our ability to adequately protect our
brand and intellectual property rights and to avoid infringing on the rights
of others; our ability to attract and retain key employees; our ability to
manage risks related to the operation of retail locations and the acquisition
or start-up of businesses; our ability to maintain effective internal
controls; our capital structure and the special voting rights provided to
designees of Thomas H. Lee Partners, L.P. on our Board of Directors; and the
risks and uncertainties described in the “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations”
sections of MoneyGram’s public reports filed with the SEC, including
MoneyGram’s Form 10-K for the year ended December 31, 2011 and its Form 10-Q
for the quarter ended September 30, 2012.


TABLE ONE
MONEYGRAM INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
                                                                          
                                                                                 
                 Three Months Ended                  Year Ended
                 December 31,           2012 vs     December 31,               2012 vs
(Amounts in
millions,       2012       2011       2011        2012         2011         2011
except per
share data)
                                                                                 
REVENUE
Fee and other    $ 351.3     $ 318.7     $ 32.6      $ 1,328.6     $ 1,230.9     $ 97.7
revenue
Investment       3.1      3.1      -         12.6       16.9       (4.3   )
revenue
Total revenue    354.4    321.8    32.6      1,341.2    1,247.8    93.4   
EXPENSES
Fee and other
commissions        158.2       141.9       16.3        599.2         547.6         51.6
expense
Investment
commissions      0.1      0.1      -         0.3        0.4        (0.1   )
expense
Total
commissions        158.3       142.0       16.3        599.5         548.0         51.5
expense
Compensation       68.7        57.9        10.8        241.6         235.7         5.9
and benefits
Transaction
and operations     63.9        61.3        2.6         355.7         227.8         127.9
support
Occupancy,
equipment and      11.1        13.3        (2.2  )     47.7          47.7          -
supplies
Depreciation
and              11.7     11.1     0.6       44.3       46.0       (1.7   )
amortization
Total
operating        313.7    285.6    28.1      1,288.8    1,105.2    183.6  
expenses
OPERATING        40.7     36.2     4.5       52.4       142.6      (90.2  )
INCOME
Other expense
(income)
Net securities     (10.0 )     -           (10.0 )     (10.0   )     (32.8   )     22.8
gains
Interest           17.7        20.4        (2.7  )     70.9          86.2          (15.3  )
expense
Debt
extinguishment     -           32.3        (32.3 )     -             37.5          (37.5  )
costs
Other            -        1.5      (1.5  )    0.4        11.9       (11.5  )
Total other      7.7      54.2     (46.5 )    61.3       102.8      (41.5  )
expense, net
Income (loss)
before income      33.0        (18.0 )     51.0        (8.9    )     39.8          (48.7  )
taxes
Income tax
expense          12.8     (21.1 )   33.9      40.4       (19.6   )   60.0   
(benefit)
NET INCOME      $ 20.2    $ 3.1     $ 17.1     $ (49.3   )  $ 59.4      $ (108.7 )
(LOSS)
                                                                                 
Earnings
(loss) per
common share:
Basic            $ 0.28      $ 0.04      $ 0.24      $ (0.69   )   $ (9.03   )   $ 8.34
Diluted          $ 0.28      $ 0.04      $ 0.24      $ (0.69   )   $ (9.03   )   $ 8.34
                                                                                 
Net income
(loss)
available to
common
stockholders:
Net income
(loss) as        $ 20.2      $ 3.1       $ 17.1      $ (49.3   )   $ 59.4        $ (108.7 )
reported
Accrued
dividends on       -           -           -           -             (30.9   )     30.9
mezzanine
equity
Accretion on
mezzanine          -           -           -           -             (80.0   )     80.0
equity
Additional
consideration
issued in
connection
with
conversion of
mezzanine          -           -           -           -             (366.8  )     366.8
equity
Cash dividends
paid on          -        -        -         -          (20.5   )   20.5   
mezzanine
equity
Net income
(loss)
available to    $ 20.2    $ 3.1     $ 17.1     $ (49.3   )  $ (438.8  )  $ 389.5  
common
stockholders
                                                                                 
Shares used in
computing
earnings
(loss) per
share: ^(1)
Basic              71.5        71.5        -           71.5          48.6          22.9
Diluted            71.6        71.7        (0.1  )     71.5          48.6          22.9
                                                                                 
                                                                                 
^(1) Includes common stock equivalents of 13.7 million for the three and twelve months
ended December 31, 2012, respectively. The following weighted-average potential common
shares are excluded from diluted income (loss) per common share as their effect is
anti-dilutive. All potential common shares are anti-dilutive in periods of net loss
available to common stockholders.
                                                                                 
                                                                                 
Shares related
to stock           3.9         4.8                     4.9           5.1
options
Shares related
to restricted
stock and          0.5         -                       0.5           0.1
restricted
stock units
Shares related
to preferred       -           -                       -             21.0
stock
                                                                                 


TABLE TWO
MONEYGRAM INTERNATIONAL, INC.
SEGMENT RESULTS
(Unaudited)
                                                                      
                                                                             
Global
Funds
Transfer
              Three Months Ended                 Year Ended
              December 31,            2012 vs    December 31,                2012 vs
(Amounts in  2012       2011       2011       2012         2011         2011
millions)
                                                                             
Money
transfer
revenue:
Fee and
other         $ 306.9     $ 273.3     $ 33.6     $ 1,148.5     $ 1,039.5     $ 109.0
revenue
Investment      -           0.2         (0.2 )     0.6           0.6           -
revenue
Bill
payment
revenue:
Fee and
other           26.0        26.7        (0.7 )     106.1         112.6         (6.5  )
revenue
Investment    -        -        -        -          -          -     
revenue
Total         332.9    300.2    32.7     1,255.2    1,152.7    102.5 
revenue
                                                                             
Commissions   157.8    141.5    16.3     597.6      545.7      51.9  
expense
                                                                             
Operating    $ 38.4    $ 33.4    $ 5.0     $ 149.6     $ 124.8     $ 24.8  
income
                                                                             
Operating       11.5  %     11.1  %                11.9    %     10.8    %
margin
                                                                             
                                                                             
                                                                             
Financial
Paper
Products
              Three Months Ended                 Year Ended
              December 31,            2012 vs    December 31,                2012 vs
(Amounts in  2012       2011       2011       2012         2011         2011
millions)
                                                                             
Money order
revenue:
Fee and
other         $ 13.6      $ 13.8      $ (0.2 )   $ 55.4        $ 57.3        $ (1.9  )
revenue
Investment      0.5         0.5         -          2.1           3.1           (1.0  )
revenue
Official
check
revenue:
Fee and
other           4.6         4.9         (0.3 )     18.3          21.1          (2.8  )
revenue
Investment    2.3      2.1      0.2      8.7        11.8       (3.1  )
revenue
Total         21.0     21.3     (0.3 )    84.5       93.3       (8.8  )
revenue
                                                                             
Commissions   0.5      0.5      -        1.9        2.4        (0.5  )
expense
                                                                             
Operating    $ 8.1     $ 5.9     $ 2.2     $ 32.7      $ 29.2      $ 3.5   
income
                                                                             
Operating       38.6  %     27.7  %                38.7    %     31.3    %
margin
                                                                             


TABLE THREE
MONEYGRAM INTERNATIONAL, INC.
SEGMENT RECONCILIATIONS
(Unaudited)
                                                                             
                                                                                    
                                                                                    
Global Funds
Transfer
                 Three Months Ended                   Year Ended
                 December 31,              2012 vs    December 31,                  2012 vs
(Amounts in     2012        2011        2011       2012          2011          2011
millions)
                                                                                    
Revenue (as     $ 332.9    $ 300.2    $ 32.7    $ 1,255.2    $ 1,152.7    $ 102.5 
reported)
                                                                                    
Adjusted
operating        $ 45.3       $ 42.0       $ 3.3      $ 176.2        $ 157.9        $ 18.3
income
                                                                                    
Restructuring
and                (5.4  )      (5.1  )      (0.3 )     (18.3   )      (19.2   )      0.9
reorganization
costs
Stock-based
compensation     (1.5  )    (3.5  )    2.0      (8.3    )    (13.9   )    5.6   
expense
Total              (6.9  )      (8.6  )      1.7        (26.6   )      (33.1   )      6.5
adjustments
                                                                         
Operating
income (as      $ 38.4     $ 33.4     $ 5.0     $ 149.6      $ 124.8      $ 24.8  
reported)
                                                                                    
Adjusted
operating          13.6  %      14.0  %                 14.0    %      13.7    %
margin
Total              (2.1  %)     (2.9  %)                (2.1    %)     (2.9    %)
adjustments
Operating
margin (as         11.5  %      11.1  %                 11.9    %      10.8    %
reported)
                                                                                    
                                                                                    
                                                                                    
Financial
Paper Products
                 Three Months Ended                   Year Ended
                 December 31,              2012 vs    December 31,                  2012 vs
(Amounts in     2012        2011        2011       2012          2011          2011
millions)
                                                                                    
Revenue (as     $ 21.0     $ 21.3     $ (0.3 )   $ 84.5       $ 93.3       $ (8.8  )
reported)
                                                                                    
Adjusted
operating        $ 8.5        $ 7.1        $ 1.4      $ 35.0         $ 33.8         $ 1.2
income
                                                                                    
Restructuring
and                (0.2  )      (0.6  )      0.4        (1.3    )      (2.3    )      1.0
reorganization
costs
Stock-based
compensation     (0.2  )    (0.6  )    0.4      (1.0    )    (2.3    )    1.3   
expense
Total              (0.4  )      (1.2  )      0.8        (2.3    )      (4.6    )      2.3
adjustments
                                                                         
Operating
income (as      $ 8.1      $ 5.9      $ 2.2     $ 32.7       $ 29.2       $ 3.5   
reported)
                                                                                    
Adjusted
operating          40.5  %      33.3  %                 41.4    %      36.3    %
margin
Total              (1.9  %)     (5.6  %)                (2.7    %)     (5.0    %)
adjustments
Operating
margin (as         38.6  %      27.7  %                 38.7    %      31.3    %
reported)
                                                                                    


TABLE FOUR
MONEYGRAM INTERNATIONAL, INC.
EBITDA, ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN
(Unaudited)
                                                             
                                                                   
                                                                   
                   Three Months Ended              Year Ended
                   December 31,                    December 31,
(Amounts in       2012           2011            2012           2011
millions)
                                                                   
Income (loss)
before income      $  33.0         $  (18.0  )     $  (8.9   )     $  39.8
taxes
Interest              17.7            20.4            70.9            86.2
expense
Depreciation
and                   11.7            11.1            44.3            46.0
amortization
Amortization of
agent signing       8.9          8.5           33.6         32.6   
bonuses
EBITDA                71.3            22.0            139.9           204.6
                                                                   
Significant
items impacting
EBITDA:
Net securities        (10.0  )        -               (10.0  )        (32.8  )
gains
Severance and
related costs         -               -               1.0             -
^(1)
Restructuring
and                   5.1             6.2             19.3            23.5
reorganization
costs
Capital
transaction           -               1.0             -               6.4
costs ^(2)
Asset
impairment            -               0.7             -               3.4
charges ^ (3)
Contribution
from investors        -               -               0.3             -
^(4)
Debt
extinguishment        -               32.3            -               37.5
^ (5)
Stock-based
compensation          1.6             4.1             9.2             16.3
expense
Legal expenses      3.7          0.9           119.2        4.8    
^(6)
Adjusted EBITDA   $  71.7       $  67.2        $  278.9      $  263.7  
                                                                   
Adjusted EBITDA       20.2   %        20.9   %        20.8   %        21.1   %
margin ^(7)
                                                                   
                                                                   
^(1) Severance and related costs from executive terminations.
^(2) Professional and legal fees related to the 2011 Recapitalization.
^(3) Impairments of assets in 2011 related to disposition activity.
^(4) Expense resulting from payment by an investor to Walmart upon liquidation
of their investment and as required by the Participation Agreement.
^(5) Debt extinguishment loss upon the termination of the senior facility in
connection with the 2011 Recapitalization.
^(6) Legal expenses for 2012 primarily include the forfeiture related to the
settlement of the investigation by the U.S. Attorney's Office for the Middle
District of Pennsylvania and the settlement of the shareholder lawsuit, as
well as legal expenses related to these matters. Legal expenses for 2011
related primarily to the shareholder derivative litigation.
^(7) Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Total
Revenue.



TABLE FIVE
MONEYGRAM INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
                                                               
                                                   December 31,   December 31,
(Amounts in millions, except share and per share  2012          2011
data)
ASSETS
Cash and cash equivalents                          $ -            $ -
Cash and cash equivalents (substantially             2,683.2        2,572.2
restricted)
Receivables, net (substantially restricted)          1,206.5        1,220.1
Short-term investments (substantially                450.1          522.0
restricted)
Available-for-sale investments (substantially        63.5           102.8
restricted)
Property and equipment                               127.9          116.3
Goodwill                                             428.7          428.7
Other assets                                       190.7       213.5    
Total assets                                       5,150.6     5,175.6  
                                                                  
LIABILITIES
Payment service obligations                        $ 4,175.4      $ 4,205.4
Debt                                                 809.9          810.9
Pension and other postretirement benefits            126.8          120.3
Accounts payable and other liabilities             199.9       149.2    
Total liabilities                                  5,312.0     5,285.8  
                                                                  
STOCKHOLDERS' DEFICIT
Participating Convertible Preferred Stock -
Series D, $0.01 par value, 200,000 shares
authorized,
109,239 issued at December 31, 2012 and December     281.9          281.9
31, 2011, respectively
Common Stock, $0.01 par value, 162,500,000
shares authorized, 62,263,963 shares issued at
December 31, 2012 and December 31, 2011,             0.6            0.6
respectively
Additional paid-in capital                           1,001.0        989.2
Retained loss                                        (1,265.9 )     (1,216.6 )
Accumulated other comprehensive loss                 (52.3    )     (38.0    )
Treasury stock: 4,407,038 and 4,429,184 shares
at December 31, 2012 and December 31, 2011,        (126.7   )   (127.3   )
respectively
Total stockholders' deficit                        (161.4   )   (110.2   )
Total liabilities and stockholders' deficit       $ 5,150.6    $ 5,175.6  
                                                                             


TABLE SIX
MONEYGRAM INTERNATIONAL, INC.
ASSETS IN EXCESS OF PAYMENT SERVICE OBLIGATIONS
(Unaudited)
                                                             
                                                                  
                                                                  
                                                                  
                     December 31,   September      June 30,       March 31,
                                    30,
(Amounts in         2012          2012          2012          2012
millions)
                                                                  
Cash and cash        $ 2,683.2      $ 2,539.8      $ 2,548.3      $ 2,547.3
equivalents
Receivables, net       1,206.5        1,330.0        1,266.9        1,210.5
Short-term             450.1          524.4          524.1          525.4
investments
Available-for-sale   63.5        79.9        85.3        93.1     
investments
                       4,403.3        4,474.1        4,424.6        4,376.3
Payment service      (4,175.4 )   (4,208.0 )   (4,156.0 )   (4,152.7 )
obligations
Assets in excess
of payment service  $ 227.9      $ 266.1      $ 268.6      $ 223.6    
obligations
                                                                             

                                                            
TABLE SEVEN
MONEYGRAM INTERNATIONAL, INC.
FREE CASH FLOW
(Unaudited)
                                                                  
                                                                  
                                                                  
                  Three Months Ended              Year Ended
                  December 31,                    December 31,
(Amounts in      2012           2011            2012           2011
millions)
                                                                  
Adjusted          $  71.7         $  67.2         $  278.9        $  263.7
EBITDA ^(1)
                                                                  
Cash payments        (16.3  )        (19.0  )        (65.2  )        (79.1  )
for interest
Cash payments        (2.0   )        (3.8   )        (2.9   )        (4.4   )
for tax
Cash payments
for capital          (16.4  )        (11.1  )        (59.6  )        (41.7  )
expenditures
Cash payments
for agent            (13.6  )        (13.1  )        (36.2  )        (33.0  )
signing
bonuses
                                                           
Free Cash Flow   $  23.4       $  20.2        $  115.0      $  105.5  
                                                                  
^(1) See Table 4, Adjusted EBITDA, for reconciliation to relevant GAAP
measures and description of adjustments

Contact:

MoneyGram International, Inc.
Media:
Patty Sullivan, 214-303-9923
media@moneygram.com
or
Investors:
Eric Dutcher, 214-979-1400
ir@moneygram.com
 
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