Thread: Western Union sees near-term immigration woes

http://today.reuters.com

UPDATE 2-Western Union sees near-term immigration woes
Mon Sep 18, 2006 8:52 AM ET


(Adds more details, background about immigration)

NEW YORK, Sept 18 (Reuters) - Western Union, the money transfer business, said on Monday that the U.S. immigration debate should weigh on operating income growth through 2007, but that long-term earnings per share should rise 12 percent to 14 percent a year.

Western Union's second-quarter results were impacted by the immigration debate as legal and illegal immigrants feared that wiring money back home would attract government attention, the company's parent, First Data Corp., said in July.

The company, which First Data <FDC.N> is spinning off on Sept. 29, said that 2006 operating income will rise between 4 percent and 6 percent, below expected long-term operating earnings growth of 10 percent to 12 percent.

In addition to the debate on immigration reform, growth for 2006 and 2007 will be slower than long-term expectations because of increased investment in the business.

The company said it expects 2006 revenue of $4.4 billion to $4.5 billion, and operating income between $1.32 billion and $1.34 billion, excluding spin-off related costs.

In 2007, Western Union forecasts operating income growth of 6 percent to 9 percent, and revenue growth from 10 percent to 12 percent, excluding expenses related to the spinoff.

The company's long-term objectives for beyond 2007 are to increase revenue and operating income between 10 percent and 12 percent annually, and earnings per share by 12 percent to 14 percent.

Western Union's second-quarter results were impacted by the immigration debate as legal and illegal immigrants feared that wiring money back home would attract government attention, the company's parent, First Data Corp., said in July.

They lose business that has been obtained through the illegal money stream - Oh well.

Not to mention the business they will lose because of their support for illegal immigration. I know I will never use them again.