What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-11-04 compared with 2022-08-03 · 173 added, 162 removed, 337 unchanged (50% of the section changed)

38 unchanged sentences

the cost of borrowing (including fluctuations in interest rates), availability of credit and terms of and compliance with debt covenants;

and ren ewal of sources of funding as they expire and the availability of replacement funding and those factors referred to above and as set forth and more fully described in Part I, Item 1A — Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2021 .

Our Annual Report on Form 10-K is available on the SEC's EDGAR website at www.sec.gov, and copies may also be obtained by contacting the Company.

Our Annual Report on Form 10-K and Quarterly Report on Form 10-Q are available on the SEC's EDGAR website at www.sec.gov, and copies may also be obtained by contacting the Company.

Any forward-looking statements made in this Form 10-Q speak only as of the date of this report.

24 unchanged sentences

Each operating segment’s sources of revenues are described below.

EFT Processing Segment — Revenues in the EFT Processing Segment, which represented approximately 30% and 25% of total consolidated revenues for the three and six months ended June 30, 2022, respectively, are derived from fees charged for transactions made by cardholders on our proprietary network of ATMs, fixed management fees and transaction fees we charge to customers for operating ATMs and processing debit and credit cards under outsourcing and cross-border acquiring agreements, foreign currency exchange margin on DCC transactions, domestic and international surcharge, foreign currency dispensing and other value added services such as advertising, prepaid telecommunication recharges, bill payment, and money transfers provided over ATMs.

EFT Processing Segment — Revenues in the EFT Processing Segment, which represented approximately 34% and 29% of total consolidated revenues for the three and nine months ended September 30, 2022, respectively, are derived from fees charged for transactions made by cardholders on our proprietary network of ATMs, fixed management fees and transaction fees we charge to customers for operating ATMs and processing debit and credit cards under outsourcing and cross-border acquiring agreements, foreign currency exchange margin on DCC transactions, domestic and international surcharge, foreign currency dispensing and other value added services such as advertising, prepaid telecommunication recharges, bill payment, and money transfers provided over ATMs.

Revenues in this segment are also derived from cardless payment, banknote recycling, tax refund services, license fees, professional services and maintenance fees for proprietary applicati on software and sales of related hardware.

epay Segment — Revenues in the epay Segment, which represented approximately 27% and 30 % of total consolidated revenues for the three and six months ended June 30, 2022, respectively, a re primarily derived from commissions earned from the distribution of electronic content, vouchers, and physical gifts and commissions or processing fees rec eived from mobile phone operators for the processing and distribution of prepaid mobile airtime.

Branded payments, which includes the distribution of digital media content, were 62% and 64% of epay Segment revenues for the three and six months ended June 30, 2022.

epay Segment — Revenues in the epay Segment, which represented approximately 27% and 29% of total consolidated revenues for the three and nine months ended September 30, 2022, respectively, a re primarily derived from commissions earned from the distribution of electronic content, vouchers, and physical gifts and commissions or processing fees rec eived from mobile phone operators for the processing and distribution of prepaid mobile airtime.

Branded payments, which includes the distribution of digital media content, wer e 69% and 66% of epay Segment revenues for the three and nine months ended September 30, 2022.

Branded payments include digital content such as music, games and software, as well as, other products including prepaid long distance calling card plans, prepaid Internet plans, prepaid debit cards, gift cards, vouchers, transport payments, lottery payments, bill payment, and money transfer.

Money Transfer Segment — Revenues in the Money Transfer Segment, which represented approximately 44% and 45% of total consolidated revenues for the three and s ix months ended June 30, 2022 , are primarily derived from transaction fees, as well as the margin earned from purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates.

Money Transfer Segment — Revenues in the Money Transfer Segment, which represented approximately 39% and 43% of total consolidated revenues for the three and nine months ended September 30, 2022 , are primarily derived from transaction fees, as well as the margin earned from purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates.

We have a sending agent network in place comprised of agents, customer service representatives, Company-owned stores, primarily in North America, Europe and Malaysia, and Ria, and xe branded websites, along with a worldwide network of correspondent agents, consisting primarily of financial institutions in the transfer destination countries.

38 unchanged sentences

Inadequate technology and resources would impair our ability to maintain current processing technology and efficiencies, as well as deliver new and innovative services to compete in the marketplace.

The outbreak of the COVID- 19 (coronavirus) pandemic has resulted in varying degrees of border and business closures, travel restrictions and other social distancing orders in most of the countries where we operate during the six months ended June 30, 2022 and 2021 .

As the number and rate of new cases has fluctuated in various locations around the globe, the closures, restrictions and other social distancing orders have been modified, rescinded and/or re-imposed.

4 unchanged sentences

SEGMENT SUMMARY RESULTS OF OPERATIONS

Revenues and operating income by segment for the three and six months ended June 30, 2022 and 2021 are summarized in the tables below:

Revenues for the Three Months Ended June 30,

Revenues and operating income by segment for the three and nine months ended September 30, 2022 and 2021 are summarized in the tables below:

Revenues for the Three Months Ended September 30,

Year-over-Year Change

Revenues for the Six Months Ended June 30,

Revenues for the Nine Months Ended September 30,

Year-over-Year Change

5 unchanged sentences

Corporate services, eliminations and other

Operating Income (Loss) for the Three Months Ended June 30,

Operating Income (Loss) for the Three Months Ended September 30,

Year-over-Year Change

Operating Income (Loss) for the Six Months Ended June 30,

Operating Income (Loss) for the Nine Months Ended September 30,

Year-over-Year Change

15 unchanged sentences

Average Translation Rate

Three Months Ended June 30,

Three Months Ended September 30,

Average Translation Rate

Six Months Ended June 30,

Nine Months Ended September 30,

Currency (dollars per foreign currency)

5 unchanged sentences

New Zealand dollar

COMPARISON OF OPERATING RESULTS FOR THE SIX MONTHS ENDED JUNE 30 , 2022 AND 2021

COMPARISON OF OPERATING RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30 , 2022 AND 2021

EFT PROCESSING SEGMENT

The following table summarizes the results of operations for our EFT Processing Segment for the three and six months ended June 30, 2022 and 2021 :

The following table summarizes the results of operations for our EFT Processing Segment for the three and nine months ended September 30, 2022 and 2021 :

Three Months Ended

September 30,

Year-over-Year Change

Six Months Ended

Three Months Ended September 30,

Year-over-Year Change

13 unchanged sentences

Transactions processed (millions)

Active ATMs as of June 30,

Active ATMs as of September 30,

Average Active ATMs

EFT Processing Segment total revenues were $249.0 million for the three months ended June 30, 2022 , an increase of $135.5 million or 119 % compared to the same period in 2021 .

EFT Processing Segment total revenues were $394.6 million for the six months ended June 30, 2022, an increase of $194.0 million or 97%.

EFT Processing Segment total revenues were $319.5 million for the three months ended September 30, 2022 , an increase of $92.3 million or 41 % compared to the same period in 2021 .

EFT Processing Segment total revenues were $714.1 million for the nine months ended September 30, 2022, an increase of $286.4 million or 67%.

The increase in revenues was primarily due to the increase in domestic and international cash withdrawal transactions resulting from the reduction of travel restrictions across Europe, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Foreign currency movements decreased revenues by approximately $28.5 million and $37.0 million for the three and six months ended June 30, 2022 , respectively, compared to the same period in 2021 .

Average monthly revenues per ATM increased to $1,696 for the three months ended June 30, 2022 compared to $934 for the same period in 2021 .

Average monthly revenues per ATM increased to $1,425 for the six months ended June 30, 2022 compared to $ 867 for the same period in 2021 .

Revenues per transaction increased to $0.16 for the three m onths ended June 30, 2022 compared to $0.11 for the same period in 2021 .

Revenues per transaction increased to $ 0.14 for the six m onths ended June 30, 2022 compared to $ 0.10 for the same period in 2021 .

The increases in average monthly revenues per ATM and revenues per transaction were primarily due to the increase in domestic and international cash withdrawal transactions resulting from the reduction in travel restrictions across Europe, partially offset by the increase in volume of low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Foreign currency movements decreased revenues by approximately $48.6 million and $85.6 million for the three and nine months ended September 30, 2022 , respectively, compared to the same period in 2021 .

Average monthly revenues per ATM increased to $2,112 for the three months ended September 30, 2022 compared to $ 1,660 for the same period in 2021 .

Average monthly revenues per ATM increased to $2,501 for the nine months ended September 30, 2022 compared to $1,162 for the same period in 2021 .

Revenues per transaction decreased to $0.18 for the three m onths ended September 30, 2022 compared to $0.19 for the same period in 2021 .

Revenues per transaction increased to $0.15 for the nine m onths ended September 30, 2022 compared to $0.14 for the same period in 2021 .

The increases in average monthly revenues per ATM was primarily due to the increase in domestic and international cash withdrawal transactions resulting from the reduction in travel restrictions across Europe, partially offset by the increase in volume of low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Direct operating costs

EFT Processing Segment direct operating costs were $123.8 million for the three months ended June 30, 2022 , an increase of $41.1 million or 50 % compared to the same period in 2021 .

EFT Processing Segment direct operating costs were $217.1 million for the six months ended June 30, 2022 , an increase of $64.8 million or 43 % compared to the same period in 2021 .

EFT Processing Segment direct operating costs were $137.8 million for the three months ended September 30, 2022 , an increase of $31.5 million or 30 % compared to the same period in 2021 .

EFT Processing Segment direct operating costs were $354.9 million for the nine months ended September 30, 2022 , an increase of $96.3 million or 37 % compared to the same period in 2021 .

Direct operating costs primarily consist of site rental fees, cash delivery costs, cash supply costs, maintenance, insurance, telecommunications, payment scheme processing fees, data center operations-related personnel, as well as the processing centers’ facility-related costs and other processing center-related expenses and commissions paid to retail merchants, banks and card processors.

The increase in direct operating costs was primarily due to the increase in the number of ATMs under management as there were fewer deactivated ATMs during the six months ended June 30, 2022 compared to the same period in 2021 resulting in an increase in ATM site rental fees and cash delivery costs.

Foreign currency movements decreased direct operating costs by approximately $13.9 million and $19.5 million for the three and six months ended June 30, 2022 , respectively, compared to the same periods in 2021 .

Gross profit, which is calculated as revenues less direct operating costs, was $125.3 million for the three months ended June 30, 2022 , an increase of $94.5 million or 307% compared to $30.8 million for the same period in 2021 .

Gross profit, was $ 177.5 million for the six months ended June 30, 2022 , an increase of $129.2 million or 267% compared to $ 48.3 million for the same period in 2021 .

Gross profit as a percentage of revenues (“gross margin”) increased to 50.3 % and 45.0% for the three and six months ended June 30, 2022 , respectively, compared to 27.1% and 24.1% for the same periods in 2021 .

The increase in direct costs was primarily due to the increase in domestic and international cash withdrawal transactions resulting from the reduction of travel restrictions across Europe, the increase in low-value point-of-sale transactions in Europe and low-value payment processing transactions in Asia Pacific.

Foreign currency movements decreased direct operating costs by approximately $20.8 million and $40.3 million for the three and nine months ended September 30, 2022 , respectively, compared to the same periods in 2021 .

Gross profit, which is calculated as revenues less direct operating costs, was $181.7 million for the three months ended September 30, 2022 , an increase of $60.8 million or 50% compared to $120.8 million for the same period in 2021 .

Gross profit, was $359.2 million for the nine months ended September 30, 2022 , an increase of $190.1 million or 112% compared to $169.1 million for the same period in 2021 .

Gross profit as a percentage of revenues (“gross margin”) increased to 56.9 % and 50.3% for the three and nine months ended September 30, 2022 , respectively, compared to 53.2% and 39.5% for the same periods in 2021 .

The increase in gross profit and gross margin were primarily due to the incremental volume of transactions that were processed on our network relative to the fixed costs incurred, and the higher proportion of high value and high margin DCC transactions due to reduction of travel restrictions.

Salaries and benefits

Salaries and benefits expenses were $27.7 million for the three months ended June 30, 2022, an increase of $3.6 million or 15% c ompared to the same period in 2021 .

Salaries and benefits expenses were $52.9 million for the six months ended June 30, 2022, an increase of $5.3 million or 11% c ompared to the same period in 2021 .

The increase is primarily due to an increase in headcount to support the growth of the business.

Foreign currency movements in the countries in which we employ our workforce reduced these expenses by $3.5 million and $5.0 million for the three and six months ended June 30, 2022, respectively, compared to the same period in 2021.

As a percentage of revenues, these expenses decreased to 11.1 % and 13.4% for the three and six months ended June 30, 2022 , respectively, compared to 21.2% and 23.8% for the same periods in 2021 .

Salaries and benefits expenses were $30.0 million for the three months ended September 30, 2022, an increase of $6.4 million or 27% c ompared to the same period in 2021 .

Salaries and benefits expenses were $83.0 million for the nine months ended September 30, 2022, an increase of $11.6 million or 16% c ompared to the same period in 2021 .

The increase is primarily due to an increase in salaries and headcount to support the growth of the business.

Foreign currency movements in the countries in which we employ our workforce reduced these expenses by $4.8 million and $9.9 million for the three and nine months ended September 30, 2022 , respectively, compared to the same period in 2021.

As a percentage of revenues, these expenses decreased to 9.4 % and 11.6% for the three and nine months ended September 30, 2022 , respectively, compared to 10.4% and 16.7% for the same periods in 2021 .

Selling, general and administrative

Selling, general and administrative expenses were $17.0 million for the three months ended June 30, 2022 , an increase of $7.2 million or 74% compared to the same period in 2021 .

Selling, general and administrative expenses were $28.1 million for the six months ended June 30, 2022 , an increase of $6.4 million or 29% compared to the same period in 2021 .

As a percentage of revenues, these expenses decreased to 6.8 % and 7.1% for the three and six months ended June 30, 2022 , respectively, compared to 8.6 % and 10.9% for the same periods in 2021 .

Selling, general and administrative expenses were $12.2 million for the three months ended September 30, 2022 , an increase of $0.9 million or 8% compared to the same period in 2021 .

Selling, general and administrative expenses were $40.3 million for the nine months ended September 30, 2022 , an increase of $7.2 million or 22% compared to the same period in 2021 .

As a percentage of revenues, these expenses decreased to 3.8 % and 5.6% for the three and nine months ended September 30, 2022 , respectively, compared to 5.0 % and 7.7% for the same periods in 2021 .

Depreciation and amortization

Depreciation and amortization expenses were $25.7 million for the three months ended June 30, 2022, an increase of $3.5 million or 16% compared to the same period in 2021 .

Depreciation and amortization expenses were $48.1 million for the six months ended June 30, 2022, an increase of $3.8 million or 9% compared to the same period in 2021 .

As a percentage of revenues, these expenses decreased to 10.3 % and 12.2% for the three and six months ended June 30, 2022 , respectively, compared to 19.6 % and 22.1% for the same periods in 2021 .

Depreciation and amortization expenses were $23.1 million for the three months ended September 30, 2022, an increase of $0.4 million or 2% compared to the same period in 2021 .

Depreciation and amortization expenses were $71.2 million for the nine months ended September 30, 2022, an increase of $4.3 million or 6% compared to the same period in 2021 .

As a percentage of revenues, these expenses decreased to 7.2 % and 10.0% for the three and nine months ended September 30, 2022 , respectively, compared to 10.0 % and 15.6% for the same periods in 2021 .

Operating income

EFT Processing Segment had operating income of $54.8 million for the three months ended June 30, 2022, an increase of $80.2 million or 316% c ompared to the same period in 2021 .

EFT Processing Segment had operating income of $48.4 million for the six months ended June 30, 2022, an increase of $113.8 million or 174% compared to the same period in 2021 .

O perating income as a percentage of revenues (“operating margin”) increased to 22.0% and 12.3% for the three and six months ended June 30, 2022 , respectively, compared to (22.3%) and (32.6%) for the same periods in 2021, respectively .

Operating income per transaction was less than $0.04 and $0 .02 for the three and six months ended June 30, 2022 , compared to operating losses of ( $0.03) for the same periods in 2021 .

EFT Processing Segment had operating income of $116.4 million for the three months ended September 30, 2022, an increase of $53.2 million or 84% c ompared to the same period in 2021 .

EFT Processing Segment had operating income of $164.8 million for the nine months ended September 30, 2022, compared to a loss of ($2.2 million) for the same period in 2021 .

O perating income as a percentage of revenues (“operating margin”) increased to 36.4% and 23.1% for the three and nine months ended September 30, 2022 , respectively, compared to 27.8% and (0.5%) for the same periods in 2021, respectively .

Operating income per transaction was less than $0.07 and $0.04 for the three and nine months ended September 30, 2022 compared to operating income (loss) of $0.05 and ($0.00) for the same periods in 2021 .

The increase in operating income, improved operating margin and increase in operating income per transaction were primarily due to increased volumes processed on our network, and associated revenues, compared to the same periods in 2021.

The following table presents the results of operations for the three and six months ended June 30, 2022 and 2021 for our epay Segment:

The following table presents the results of operations for the three and nine months ended September 30, 2022 and 2021 for our epay Segment:

Three Months Ended

September 30,

Year-over-Year Change

Six Months Ended

Nine Months Ended September 30,

Year-over-Year Change

13 unchanged sentences

Transactions processed (millions)

epay Segment total revenues were $227.7 million for the three months ended June 30, 2022 , a decrease of ( $16.2) million or (7%) compared to the same period in 2021 .

epay Segment total revenues were $463.5 million for the six months ended June 30, 2022 , a decrease of ( $22.7) million or (5%) compared to the same period in 2021 .

Foreign currency movements decreased revenue by approximately $20.5 million and $33.7 million for the three and six months ended June 30, 2022 , respectively, compared to the same periods in 2021.

Revenues per transaction decreased to $0.20 and $0.23 for the three and six months ended June 30, 2022 , respectively, compared to $0.31 and $0.33 for the same periods in 2021 .

The decrease in revenues per transaction was primarily due to the increase in the number of transactions processed in a region where we generally earn lower revenues per transaction.

epay Segment total revenues were $248.9 million for the three months ended September 30, 2022 , an increase of $10.6 million or 4% compared to the same period in 2021 .

epay Segment total revenues were $712.5 million for the nine months ended September 30, 2022 , a decrease of ( $12.1 million) or (2%) compared to the same period in 2021 .

The increase in revenue for the three months ended September 30, 2022 is driven by continued expansion in mobile and digital branded payments, together with continued growth of the digital distribution channel.

Additionally, the annual recurring benefits of loyalty reward programs, which were previously recognized in earlier quarters in 2021, were recognized in the third quarter of 2022.

Foreign currency movements decreased revenue by approximately $32.4 million and $66.1 million for the three and nine months ended September 30, 2022 , respectively, compared to the same periods in 2021.

Revenues per transaction decreased to $0.27 and $0.25 for the three and nine months ended September 30, 2022 , respectively, compared to $0.29 and $0.32 for the same periods in 2021 .

The decrease in revenues per transaction was primarily due to the increase in the number of mobile transactions processed in a region where we generally earn lower revenues per transaction.

Direct operating costs

epay Segment direct operating costs were $173.7 million for the three months ended June 30, 2022 , a decrease of ( $11.3) million or (6%) compared to the same period in 2021 .

epay Segment direct operating costs were $352.0 million for the six months ended June 30, 2022 , a decrease of ( $15.6) million or (4%) compared to the same period in 2021 .

epay Segment direct operating costs were $190.1 million for the three months ended September 30, 2022 , an increase of $9.9 million or 5% compared to the same period in 2021 .

epay Segment direct operating costs were $542.1 million for the nine months ended September 30, 2022 , a decrease of ( $5.8 million) or (1%) compared to the same period in 2021 .

Direct operating costs primarily consist of the commissions paid to retail merchants for the distribution and sale of prepaid mobile airtime and other prepaid products, expenses incurred to operate POS terminals and the cost of vouchers sold and physical gifts fulfilled.

The decrease in direct operating costs was primarily due to the $15.1 million and $24.6 million decrease caused by foreign currency movements for the three and six months ended June 30, 2022 , respectively, compared to the same periods in 2021 .

Gross profit was $54.1 million for the three months ended June 30, 2022 , a decrease of ($4.9 million) or (8.3%) compared to $58.9 million for the same period in 2021 .

Gross profit was $111.6 million for the six months ended June 30, 2022 , a decrease of ($7.0 million) or (5.9%) compared to $118.6 million for the same period in 2021 .

Gross margin decreased to 23.7 % and 24.1% for the three and six months ended June 30, 2022 , respectively, compared to 24.2% and 24.4% for the same periods in 2021 .

The decrease in gross profit and gross margin is primarily due to decrease in revenues associated with the shift in mix of transactions processed .

The increase in direct operating costs was primarily due to an increase in activity, driven by benefits from loyalty reward programs.

Foreign currency movements decrease direct operating costs by $24.3 million and $49.0 million for the three and nine months ended September 30, 2022 , respectively, compared to the same periods in 2021 .

Gross profit was $58.8 million for the three months ended September 30, 2022 , an increase of $0.7 million or 1.2% compared to $58.1 million for the same period in 2021 .

Gross profit was $170.4 million for the nine months ended September 30, 2022 , a decrease of ($6.3 million) or (3.6%) compared to $176.7 million for the same period in 2021 .

Gross margin decreased to 23.6 % and 23.9% for the three and nine months ended September 30, 2022 , respectively, compared to 24.4% for both the three and nine month periods in 2021 .

The decrease in gross profit and gross margin is primarily due to a decrease in revenues associated with the shift in mix of transactions processed .

Salaries and benefits

Salaries and benefits expenses were $19.8 million for the three months ended June 30, 2022 , no change compared to the same period in 2021 .

Salaries and benefits expenses were $39.9 million for the six months ended June 30, 2022 , an increase of $0.8 million or 2% compared to the same period in 2021 .

The increase in salaries and benefits was driven by an increase in headcount to support the growth of the business, partially offset by a $1.8 million and $2.9 million decrease from foreign currency movements for the three and six months ended June 30, 2022, respectively, compared to the same periods in 2021.

As a percentage of revenues, these expenses increased to 8.7 % and 8.6% for the three and six months ended June 30, 2022, respectively, compared to 8.1% for both of the same periods in 2021.

Salaries and benefits expenses were $19.8 million for the three months ended September 30, 2022 , a decrease of ( $0.3 million) or (2%) compared to the same period in 2021 .

Salaries and benefits expenses were $59.7 million for the nine months ended September 30, 2022 , an increase of $0.5 million or 1% compared to the same period in 2021 .

The fluctuations in salaries and benefits was driven by an increase in salaries and headcount to support the growth of the business, offset by a $2.5 million and $5.4 million decrease from foreign currency movements for the three and nine months ended September 30, 2022 , respectively, compared to the same periods in 2021.

As a percentage of revenues, these expenses decreased to 7.9 % and increased to 8.4% for the three and nine months ended September 30, 2022, respectively, compared to 8.4% and 8.2% for the three and nine months ended September 30, 2021, respectively .

Selling, general and administrative

Selling, general and administrative expenses were $8.3 million for the three months ended June 30, 2022 , a decrease of ($1.5 million) or (15 %) compared to the same period in 2021 .

Selling, general and administrative expenses were $17.7 million for the six months ended June 30, 2022 , a decrease of ($1.1 million) or (6 %) compared to the same period in 2021 .

As a percentage of revenues, these expenses increased to 3.6 % and 3.8% for the three and six months ended June 30, 2022 , respectively, compared to 4.0 % and 3.9% for the same period in 2021 .

Selling, general and administrative expenses were $8.5 million for the three months ended September 30, 2022 , a decrease of ($1.3 million) or (13 %) compared to the same period in 2021 .

Selling, general and administrative expenses were $26.2 million for the nine months ended September 30, 2022 , a decrease of ($2.4 million) or (8 %) compared to the same period in 2021 .

As a percentage of revenues, these expenses decreased to 3.4 % and 3.7% for the three and nine months ended September 30, 2022 , respectively, compared to 4.1 % and 3.9% for the same period in 2021 .

Depreciation and amortization

Depreciation and amortization expenses were $1.6 million for the three months ended June 30, 2022 , a decrease of ($0.5 million) or (25 %) compared to the same period in 2021 .

Depreciation and amortization expenses were $3.3 million for the six months ended June 30, 2022 , a decrease of ($1.0 million) or (22 %) compared to the same period in 2021 .

Depreciation and amortization expenses were $1.4 million for the three months ended September 30, 2022 , a decrease of ($0.8 million) or (36 %) compared to the same period in 2021 .

Depreciation and amortization expenses were $4.7 million for the nine months ended September 30, 2022 , a decrease of ($1.8 million) or (27 %) compared to the same period in 2021 .

Depreciation and amortization expense primarily represents depreciation of POS terminals we install in retail stores and amortization of acquired intangible assets.

As a percentage of revenues, these expenses decreased to 0.7 % for both the three and six months ended June 30, 2022, respectively, compared to 0.9% for the same periods in 2021.

As a percentage of revenues, these expenses decreased to 0.6% and 0.7% for the three and nine months ended September 30, 2022 , respectively, compared to 0.9 % for both the three and nine months ended September 30, 2021.

Operating income

epay Segment operating income was $24.4 million for the three months ended June 30, 2022 , a decrease of ($2.8 million) or (10%) c ompared to the same period in 2021 .

epay Segment operating income was $50.6 million for the six months ended June 30, 2022 , a decrease of ( $5.8 million) or (1 0 %) c ompared to the same period in 2021 .

Operating margin decreased to 10.7 % and 10.9% for the three and six months ended June 30, 2022, respectively , compared to 11.2 % and 11.6% for the same periods in 2021 .

Operating income per transaction decreased to $0.02 and $0.03 for the three and six months ended June 30, 2022, respectively compared to $0.03 and $0.04 for same period in 2021 .

The decreases in operating income, operating margin and operating income per transaction for the three months ended June 30, 2022 compared to the same period in 2021 were primarily due to the shift in mix of transactions processed .

epay Segment operating income was $29.1 million for the three months ended September 30, 2022 , an increase of $3.2 million or 12% c ompared to the same period in 2021 .

epay Segment operating income was $79.7 million for the nine months ended September 30, 2022 , a decrease of ( $2.6 million) or ( 3 %) c ompared to the same period in 2021 .

Operating margin increased to 11.7 % and decreased to 11.2% for the three and nine months ended September 30, 2022 , respectively , compared to 10.9 % and 11.4% for the same periods in 2021 .

Operating income per transaction was $0.03 for both the three and nine m onths ended September 30, 2022, respectively, compared to $0.03 and $0.04 for the same periods in 2021 .

The changes in operating income, operating margin and operating income per transaction for the three and nine months ended September 30, 2022 compared to the same period in 2021 were primarily due to the shift in mix of transactions processed .

MONEY TRANSFER SEGMENT

The following table presents the results of operations for the three and six months ended June 30, 2022 and 2021 for the Money Transfer Segment:

Three Months Ended June 30,

The following table presents the results of operations for the three and nine months ended September 30, 2022 and 2021 for the Money Transfer Segment:

Three Months Ended September 30,

Year-over-Year Change

Six Months Ended June 30,

Nine Months Ended September 30,

Year-over-Year Change

13 unchanged sentences

Transactions processed (millions)

Money Transfer Segment total revenues were $368.5 million for the three months ended June 30, 2022 , an increase of $9.2 million or 3 % compared to the same period in 2021 .

Money Transfer Segment total revenues were $707.4 million for the six months ended June 30, 2022 , an increase of $23.2 million or 3 % compared to the same period in 2021 .

Money Transfer Segment total revenues were $364.8 million for the three months ended September 30, 2022 , an increase of $11.4 million or 3 % compared to the same period in 2021 .

Money Transfer Segment total revenues were $1,072.3 million for the nine months ended September 30, 2022 , an increase of $34.6 million or 3 % compared to the same period in 2021 .

The increase in revenues was primarily due to the increase in international-originated money transfers, U.S.

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domestic transactions.

Revenues per transaction decreased to $9.88 and $10.00 for the three and six months ended June 30, 2022 , respectively, compared to $10.51 and $10.48 for the same periods in 2021 due to a shift in the mix of transactions processed.

Foreign currency movements decreased revenues by approximately $22.5 million and $34.4 million for the three and six months ended June 30, 2022, respectively, compared to the same periods in 2021 .

Revenues per transaction decreased to $9.68 and $9.89 for the three and nine months ended September 30, 2022 , respectively, compared to $10.37 and $10.44 for the same periods in 2021 due to a shift in the mix of transactions processed.

Foreign currency movements decreased revenues by approximately $28.2 million and $62.6 million for the three and nine months ended September 30, 2022, respectively, compared to the same periods in 2021 .

Direct operating costs

Money Transfer Segment direct operating costs were $205.1 million for the three months ended June 30, 2022 , were essentially flat compared to the same period in 2021 .

Money Transfer Segment direct operating costs were $393.5 million for the six months ended June 30, 2022 , an increase of $4.4 million or 1 % compared to the same period in 2021 .

Money Transfer Segment direct operating costs were $200.2 million for the three months ended September 30, 2022 , and were essentially flat compared to the same period in 2021 .

Money Transfer Segment direct operating costs were $593.6 million for the nine months ended September 30, 2022, an increase of $4.4 million or 1 % compared to the same period in 2021 .

Direct operating costs primarily consist of commissions paid to agents who originate money transfers on our behalf and correspondent agents who disburse funds to the customers’ destination beneficiaries, together with less significant costs, such as bank depository fees.

The increase in direct operating costs was primarily due to the increase in the number of international-originated and U.S.

outbound money transfer transactions, partially offset by foreign currency movements that decreased direct operating costs by approximately $11.4 million and $17.3 million for the three and six months ended June 30, 2022, respectively, compared to the same periods in 2021 .

Gross profit was $163.4 million for the three months ended June 30, 2022 , an increase of $9.3 million or 6.0% compared to $154.1 million for the same period in 2021 .

Gross profit was $314.0 million for the six months ended June 30, 2022 , an increase of $18.8 million or 6.4% compared to $295.2 million for the same period in 2021 .

Gross margin increased to 44.3% and 44.4% for the three and six months ended June 30, 2022, respectively, compared to 42.9% and 43.1% for the same periods in 2021.

outbound money transfer transactions, offset by foreign currency movements that decreased direct operating costs by approximately $14.0 million and $31.3 million for the three and nine months ended September 30, 2022, respectively, compared to the same periods in 2021 .

Gross profit was $164.7 million for the three months ended September 30, 2022 , an increase of $11.5 million or 7.5% compared to $153.2 million for the same period in 2021 .

Gross profit was $478.6 million for the nine months ended September 30, 2022 , an increase of $30.2 million or 6.7% compared to $448.4 million for the same period in 2021 .

Gross margin increased to 45.1% and 44.6% for the three and nine months ended September 30, 2022, respectively, compared to 43.3% and 43.2% for the same periods in 2021.

The increase in gross profit and gross margin was primarily due t o increases in international-originated money transfers, U.S.

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Salaries and benefits

Salaries and benefits expenses were $68.0 million for the three months ended June 30, 2022, an increase of $5.3 million or 8% compared to the same period in 2021 .

Salaries and benefits expenses were $135.2 million for the six months ended June 30, 2022, an increase of $12.0 million or 10% compared to the same period in 2021 .

The increase in salaries and benefits was primarily driven by an increase in headcount to support the growth of the business.

As a percentage of revenues, these expenses increased to 18.4 % and 19.1% for the three and six months ended June 30, 2022 , respectively, compared to 17.5% and 18.4% for the same periods in 2021 .

Salaries and benefits expenses were $69.7 million for the three months ended September 30, 2022, an increase of $4.4 million or 7% compared to the same period in 2021 .

Salaries and benefits expenses were $204.9 million for the nine months ended September 30, 2022, an increase of $16.4 million or 9% compared to the same period in 2021 .

The increase in salaries and benefits was primarily driven by an increase in salaries and headcount to support the growth of the business.

As a percentage of revenues, these expenses increased to 19.1 % for both the three and nine months ended September 30, 2022 , compared to 18.5% and 18.2% for the same periods in 2021 .

Selling, general and administrative

Selling, general and administrative expenses were $46.4 million for the three months ended June 30, 2022 , an increase of $8.0 million or 21 % compared to the same period in 2021 .

Selling, general and administrative expenses were $87.4 million for the six months ended June 30, 2022 , an increase of $13.0 million or 17 % compared to the same period in 2021 .

Selling, general and administrative expenses were $46.3 million for the three months ended September 30, 2022 , an increase of $4.7 million or 11 % compared to the same period in 2021 .

Selling, general and administrative expenses were $133.7 million for the nine months ended September 30, 2022 , an increase of $17.7 million or 15 % compared to the same period in 2021 .

The increase was primarily due to an increase in marketing expenses and travel related expenses.

As a percentage of revenues, these expenses increased to 12.6 % and 12.4% for the three and six months ended June 30, 2022 , respectively, compared to 10.7% and 10.9% for the same periods in 2021 .

As a percentage of revenues, these expenses increased to 12.7 % and 12.5% for the three and nine months ended September 30, 2022 , respectively, compared to 11.8% and 11.2% for the same periods in 2021 .

Depreciation and amortization

Depreciation and amortization expenses were $8.5 million for the three months ended June 30, 2022, a decrease of ( $0.5 million) or (5 %) compared to the same period in 2021 .

Depreciation and amortization expenses were $17.4 million for the six months ended June 30, 2022, a decrease of ( $ 0 .6 million) or (3 %) compared to the same period in 2021 .

Depreciation and amortization expenses were $8.2 million for the three months ended September 30, 2022, a decrease of ( $0.7 million) or (8 %) compared to the same period in 2021 .

Depreciation and amortization expenses were $25.6 million for the nine months ended September 30, 2022, a decrease of ( $ 1.3 million) or (5 %) compared to the same period in 2021 .

Depreciation and amortization primarily represents amortization of acquired intangible assets and depreciation of money transfer terminals, computers and software, leasehold improvements and office equipment.

As a percentage of revenues, these expenses decreased to 2.3 % and 2.5% for the three and six months ended June 30, 2022, respectively, compared to 2.5 % and 2.6% for the same periods in 2021 .

As a percentage of revenues, these expenses decreased to 2.2 % and 2.4% for the three and nine months ended September 30, 2022, respectively, compared to 2.5 % and 2.6% for the same periods in 2021 .

Operating income

Money Transfer Segment operating income was $40.5 million for the three months ended June 30, 2022 , a decrease of ( $3.6 million) or (8 %) compared to the same period in 2021 .

Money Transfer Segment operating income was $74.0 million for the six months ended June 30, 2022 , a decrease of ( $5.5 million) or (7 %) compared to the same period in 2021 .

Operating margin decreased to 11.0% and 10.5% for the three and six months ended June 30, 2022 , respectively, compared to 12.3 % and 11.6% for the same periods in 2021 .

The decreases in operating income and operating margin were primarily driven by the increase in salaries and selling, general and administrative expenses incurred.

Operating income per transaction decreased to $1.09 and $1.05 for the three and six months ended June 30, 2022 , respectively, compared to $1.29 and $1.22 for the same periods in 2021 due to a shift in the mix of transactions processed .

Money Transfer Segment operating income was $40.5 million for the three months ended September 30, 2022 , an increase of $3.0 million or 8 % compared to the same period in 2021 .

Money Transfer Segment operating income was $114.5 million for the nine months ended September 30, 2022 , a decrease of ( $2.5 million) or (2 %) compared to the same period in 2021 .

Operating margin increased to 11.1% and decreased to 10.7% for the three and nine months ended September 30, 2022 , respectively, compared to 10.6 % and 11.3% for the same periods in 2021 .

Operating income per transaction decreased to $1.08 and $1.06 for the three and nine months ended September 30, 2022 , respectively, compared to $1.10 and $1.18 for the same periods in 2021 due to a shift in the mix of transactions processed .

CORPORATE SERVICES

The following table presents the operating expenses for the three and six months ended June 30, 2022 and 2021 for Corporate Services:

The following table presents the operating expenses for the three and nine months ended September 30, 2022 and 2021 for Corporate Services:

Three-Month Ended

September 30,

Year-over-Year Change

Six Months Ended June 30,

Nine Months Ended September 30,

Year-over-Year Change

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Corporate operating expenses

Total Corporate operating expenses were $18.6 million and $35.1 million for the three and six months ended June 30, 2022 , respectively, an increase of $2.7 million or 17% and $5.2 million or 17% compared to the same periods in 2021 .

The increase is primarily due to an increase in short-term compensation expense of $2.2 million and $2.3 million for the three and six months ended June 30, 2022, respectively, compared to the same periods in 2021.

Total Corporate operating expenses were $17.6 million and $52.8 million for the three and nine months ended September 30, 2022 , respectively, an increase of $5.4 million or 45% and $10.7 million or 26% compared to the same periods in 2021 .

The increase is primarily due to an increase in short-term compensation expense of $4.8 million and $7.6 million for the three and nine months ended September 30, 2022, respectively, compared to the same periods in 2021.

OTHER EXPENSE, NET

Three Month Ended June 30,

Three Month Ended September 30,

Year-over-Year Change

Six Month Ended June 30,

Nine Month Ended September 30,

Year-over-Year Change

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Interest expense

Interest expense was $8.9 million for the three months ended June 30, 2022 , a decrease of ($ 0.6 million) or (6 %) compared to the same period in 2021 .

Interest expense was $15.0 million for the six months ended June 30, 2022 , a decrease of ($3.7 million) or (20%) compared to the same period in 2021 .

The decrease in interest expense relates to the $7.9 million accretion expense incurred for the six months ended June 30, 2021 , which was eliminated for the six months ended June 30, 2022 as a result of the adoption of ASU 2020-06, partially offset by increased interest rates and borrowings on the revolving Credit Facility for the s ix months ended June 30, 2022 compared to the same period in 2021.

Interest expense was $11.7 million for the three months ended September 30, 2022 , an increase of $ 1.6 million or 16 % compared to the same period in 2021 .

Interest expense was $26.7 million for the nine months ended September 30, 2022 , a decrease of ($2.0 million) or (7%) compared to the same period in 2021 .

The decrease in interest expense relates to the $7.9 million accretion expense incurred for the nine months ended September 30, 2021 , which was eliminated for the nine months ended September 30, 2022 as a result of the adoption of ASU 2020-06, partially offset by increased interest rates and borrowings on the revolving Credit Facility for the nine months ended September 30, 2022 compared to the same period in 2021.

See Footnote 2, Recently Issued and Adopted Accounting Pronouncements, for more information on the impact of this adoption.

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dollar weakens, our corporate entities will record foreign currency exchange gains.

We recorded net foreign currency exchange losses of $14.7 million and $20.2 million for the three and six months ended June 30, 2022 , respectively, compared to a net foreign currency exchange gain of $0.1 million and loss of $3.9 million for the same periods in 2021, respectively.

We recorded net foreign currency exchange losses of $15.8 million and $36.0 million for the three and nine months ended September 30, 2022 , respectively, compared to a net foreign currency exchange losses of $8.1 million and $12.1 million for the same periods in 2021, respectively.

These realized and unrealized foreign currency exchange losses reflect the fluctuation in the value of the U.S.

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INCOME TAX EXPENSE

Our effective income tax rate was 26.7 % and 36.7% for the three and six months ended June 30, 2022 , respectively, compared to 58.9% and 99.9% for the same periods ended June 30, 2021, respectively.

Our effective income tax rate for the three and six months ended June 30, 2022 was higher than the applicable statutory income tax rate of 21 % as a result of certain foreign earnings being subject to higher statutory tax rates .

Our effective income tax rate for the three and six months ended June 30, 2021 was higher than the applicable statutory income tax rate of 21 % as a result of certain foreign earnings being subject to higher local tax rates, the non-recognition of tax benefits from losses in certain foreign countries where we have a limited history of profitable earnings and as a result of an increase in the valuation allowance in certain jurisdictions relating to the reversal of tax benefits recognized in the first quarter of 2021 for continuing net operating losses.

The Company's effective income tax rate was 31.1 % and 33.5% for the three and nine months ended September 30, 2022 , respectively, compared to 23.6% and 35.8% for the same periods ended September 30, 2021, respectively.

The Company's effective income tax rate for the three and nine months ended September 30, 2022 was higher than the applicable statutory income tax rate of 21 % as a result of certain foreign earnings being subject to higher statutory tax rates and the Company's U.S.

deferred tax activity on foreign exchange positions .

The Company's effective income tax rate for the three and nine months ended September 30, 2021 was higher than the applicable statutory income tax rate of 21 % as a result of certain foreign earnings being subject to higher local tax rates, the non-recognition of tax benefits from losses in certain foreign countries where the Company has a limited history of profitable earnings and as a result of an increase in the valuation allowance in certain jurisdictions relating to the reversal of tax benefits recognized in the first quarter of 2021 for continuing net operating losses.

NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS

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NET INCOME (LOSS) ATTRIBUTABLE TO EURONET

Net income attributable to Euronet was $57.2 million for the three months ended June 30, 2022, an increase of $48.6 million or 563% compared to t he same period in 2021 .

The increase in net income was primarily attributable to the $128.6 million increase in revenues, largely driven by the increases within the EFT Segment as tourism and cross-border travel increased during the second quarter of 2022 compared to the second quarter of 2021.

Net income attributable to Euronet was $97.7 million for the three months ended September 30, 2022, an increase of $23.8 million or 32% compared to t he same period in 2021 .

The increase in net income was primarily attributable to the $114.7 million increase in revenues, largely driven by the increases within the EFT Segment as tourism and cross-border travel increased during the third quarter of 2022 compared to the third quarter of 2021.

The increased revenues led to a $73.1 million increase in gross profit, with $60.9 million of this increase within the EFT Segment.

The increase in gross profit was partially offset by $10.2 million increase in salaries and benefits expense, an $8.4 million increase in income tax expense and a $14.7 million increase in selling, general and administrative expense.

Net income attributable to Euronet was $65.5 million for the six months ended June 30, 2022, an increase of $65.5 million, compared to t he net loss of ($0.03 million) in the same period in 2021 .

The increase in net income was primarily attributable to the $194.4 million increase in revenues, largely driven by the increases within the EFT Segment as tourism and cross-border travel increased during the second quarter of 2022 compared to the second quarter of 2021 .

The increase in gross profit was partially offset by $15.1 million increase in salaries and benefits expense, a $21.3 million increase in income tax expense and a $5.2 million increase in selling, general and administrative expense.

Net income attributable to Euronet was $163.2 million for the nine months ended September 30, 2022, an increase of $89.4 million, compared to t he net income of $73.9 million in the same period in 2021 .

The increase in net income was primarily attributable to the $309.1 million increase in revenues, largely driven by the increases within the EFT Segment as tourism and cross-border travel increased during the third quarter of 2022 compared to the third quarter of 2021 .

The increased revenues led to a $214.0 million increase in gross profit, with $190.1 million of this increase within the EFT Segment.

The increase in gross profit was partially offset by an $21.3 million increase in salaries and benefits expense, a $19.5 million increase in income tax expense and a $20.2 million increase in selling, general and administrative expense.

The increase in gross profit was partially offset by a $36.4 million increase in salaries and benefits expense, a $40.7 million increase in income tax expense and a $25.4 million increase in selling, general and administrative expense.

LIQUIDITY AND CAPITAL RESOURCES

Working capital

As of June 30, 2022 , we had working capital of $1,179.8 million , which is calculated as the difference between total current assets and total current liabilities, compared to working capital of $1,455.8 million as of December 31, 2021 .

The decrease in working capital was primarily due to the $330.0 million acquisition of PBMA and the $175.0 million of share repurchases, partially offset by a $213.7 million increase in borrowing on the Credit Facility as of June 30, 2022 compared to December 31, 2021 .

Our ratio of current assets to current liabilities was 1.51 and 1.79 at June 30, 2022 and December 31, 2021 , respectively.

As of September 30, 2022 , we had working capital of $1,075.4 million , which is calculated as the difference between total current assets and total current liabilities, compared to working capital of $1,455.8 million as of December 31, 2021 .

The decrease in working capital was primarily due to the $331.0 million acquisition of PBMA and the $175.0 million of share repurchases, partially offset by a $42.9 million increase in borrowing on the Credit Facility as of September 30, 2022 compared to December 31, 2021 .

Our ratio of current assets to current liabilities was 1.50 and 1.79 at September 30, 2022 and December 31, 2021 , respectively.

We require substantial working capital to finance operations.

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However, in certain countries, we fund the cash required to operate our ATM network from borrowings under our revolving credit facilities, uncommitted credit agreements and cash flows from operations.

As of June 30, 2022 , we had $890.8 million of our own cash in use or designated for use in our ATM network, which is recorded in ATM cash on Euronet's Consolidated Balance Sheet.

ATM cash increased $347.4 million from $543.4 million as of December 31, 2021 to $890.8 million as of June 30, 2022 as a result of the increase in number of active ATMs as of June 30, 2022 compared to December 31, 2021.

The Company has $1,014.9 million of unrestricted cash as of June 30, 2022 compared to $1,260.5 million as of December 31, 2021 .

The decrease in unrestricted cash was primarily due to the $346.2 million acquisition of PBMA, the $101.0 million allocated from unrestricted cash to ATM cash and the $175.0 million of share repurchases during the six months ended June 30, 2022, partially offset by the $213.7 million increase in borrowings on the Credit Facility.

Including the $890.8 million of cash in ATMs at June 30, 2022 , we have access to $1,905.7 million in available cash, and $479.1 million available under the Credit Facility with no significant long-term debt principal payments until October 2023.

The following table identifies cash and cash equivalents provided by/(used in) our operating, investing and financing activities for the six months ended June 30, 2022 and 2021 (in thousands):

Six Months Ended June 30,

As of September 30, 2022 , we had $646.1 million of our own cash in use or designated for use in our ATM network, which is recorded in ATM cash on Euronet's Consolidated Balance Sheet.

ATM cash increased $102.7 million from $543.4 million as of December 31, 2021 to $646.1 million as of September 30, 2022 as a result of the increase in number of active ATMs as of September 30, 2022 compared to December 31, 2021.

The Company has $967.1 million of unrestricted cash as of September 30, 2022 compared to $1,260.5 million as of December 31, 2021 .

The decrease in unrestricted cash was primarily due to the $331.0 million acquisition of PBMA, the $102.7 million allocated from unrestricted cash to ATM cash and the $175.0 million of share repurchases during the nine months ended September 30, 2022, partially offset by the $42.9 million increase in borrowings on the Credit Facility.

Including the $646.1 million of cash in ATMs at September 30, 2022 , we have access to $1,613.2 million in available cash, and $652.8 million available under the Credit Facility with no significant long-term debt principal payments until March 2025.

The following table identifies cash and cash equivalents provided by/(used in) our operating, investing and financing activities for the nine months ended September 30, 2022 and 2021 (in thousands):

Nine Months Ended September 30,

Cash and cash equivalents and restricted cash provided by (used in):

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Operating activity cash flow

Cash flows provided by operating activities were $180.7 million f or the three months ended June 30, 2022 compared to cash flows used in operating activities of $173.3 million for the same period in 2021 .

Cash flows provided by operating activities were $448.6 million f or the three months ended September 30, 2022 compared to cash flows provided by operating activities of $304.3 million for the same period in 2021 .

The increase in operating cash flows was primarily due to the $89.2 million increase in net income, partially offset by fluctuations in working capital mainly associated with the timing of the settlement processes with content providers in the epay Segment, with correspondents in the Money Transfer Segment, and with card organizations and banks in the EFT Processing Segment.

Investing activity cash flow

Cash flows used in investing activities were $387.0 million for the six months ended June 30, 2022 compared to $48.3 million for the same period in 2021 .

Cash flows used in investing activities were $416.0 million for the nine months ended September 30, 2022 compared to $71.0 million for the same period in 2021 .

The increase in cash used in investing activities is primarily due to the $331.0 million of cash paid at the closing of PBMA in March 2022.

Additionally, w e used $53.1 million for purchases of property and equipment for the s ix months ended June 30, 2022 compared to $45.1 million for the same period in 2021 .

Additionally, w e used $79.4 million for purchases of property and equipment for the nine months ended September 30, 2022 compared to $66.1 million for the same period in 2021 .

The increase in purchases of property and equipment is primarily due to the prior period expenditures being reduced by the COVID-19 related impacts to the EFT segment.

Cash used for software development and other investing activities totaled $3.8 million and $3.3 million for the six months ended June 30, 2022 and 2021 , respectively.

Cash used for software development and other investing activities totaled $5.3 million and $4.9 million for the nine months ended September 30, 2022 and 2021 , respectively.

Financing activity cash flow

Cash flows provided by financing activities were $491.2 million for the six months ended June 30, 2022 compared to cash flows used in financing activities of $248.6 million for the same period in 2021 .

Our borrowing activities on the Credit Facility for the six months ended June 30, 2022 consisted of net borrowings of $663.7million compared to net repayments of $249.6 million for the same period in 2021.

The increase in net borrowings on the Credit Facility, during the six months ended June 30, 2022, is primarily the result of treasury management relating to settlement requirements across currencies as well as increased funding requirements for acquisitions and share repurchases.

We repurchased $175.3 million of common stock during the six months ended June 30, 2022 compared to repurchases of $0.9 million during the same period of 2021 .

We received proceeds of $3.7 million and $5.3 million during the six months ended June 30, 2022 and 2021 , respectively, for the issuance of stock in connection with our Stock Incentive Plan.

Cash flows provided by financing activities were $173.5 million for the nine months ended September 30, 2022 compared to cash flows used in financing activities of $216.3 million for the same period in 2021 .

Our borrowing activities on the Credit Facility for the nine months ended September 30, 2022 consisted of net borrowings of $342.9 million compared to net repayments of $217.2 million for the same period in 2021.

The increase in net borrowings on the Credit Facility, during the nine months ended September 30, 2022, is primarily the result of treasury management relating to settlement requirements across currencies as well as increased funding requirements for acquisitions and share repurchases.

We repurchased $175.3 million of common stock during the nine months ended September 30, 2022 compared to repurchases of $1.0 million during the same period of 2021 .

We received proceeds of $4.4 million and $6.4 million during the nine months ended September 30, 2022 and 2021 , respectively, for the issuance of stock in connection with our Stock Incentive Plan.

Effect of exchange rates on cash, cash equivalents and restricted cash

F oreign currency exchange rates for the six months ended June 30, 2022 and 2021 had a negative impact of $195.2 million and $43.3 million, respectively, on cash, cash equivalents, and restricted cash.

The negative impact on cash, cash equivalents, and restricted cash for the six months ended June 30, 2022 was due primarily to the negative impact in the exchange rate of the U.S.

F oreign currency exchange rates for the nine months ended September 30, 2022 and 2021 had a negative impact of $413.7 million and $82.7 million, respectively, on cash, cash equivalents, and restricted cash.

The negative impact on cash, cash equivalents, and restricted cash for the nine months ended September 30, 2022 was due primarily to the negative impact in the exchange rate of the U.S.

dollar to the Euro.

Other sources of capital

Credit Facility - On October 17, 2018, we entered into a $1.0 billion unsecured credit agreement (the "Credit Facility") that expires on October 17, 2023.

The Credit Facility allows for borrowings in Australian dollars, British pounds sterling, Canadian dollars, Czech koruna, Danish krone, euro, Hungarian forints, Japanese yen, New Zealand dollars, Norwegian krone, Polish zlotys, Swedish krona, Swiss francs, and U.S.

The Credit Facility contains a $200 million sublimit for the issuance of letters of credit, a $50 million sublimit for U.S.

Dollar swingline loans, and a $90 million sublimit for certain foreign currencies swingline loans.

As of June 30, 2022 , fees and interest on borrowings are based upon our corporate credit rating (as defined in the credit agreement) and are based, in the case of letter of credit fees, on a margin, and in the case of interest, on a margin over the London InterBank Offered Rate ("LIBOR") or a margin over the base rate, as selected by us, with the applicable margin ranging from 1.125% to 2.0% (or 0.175% to 1.0 % for base rate loans).

As of June 30, 2022 , we had $497.1 million of borrowings and $53.8 million of stand-by letters of credit outstanding under the Credit Facility.

Credit Facility - On October 24, 2022, the Company amended its revolving credit agreement (the “Credit Facility”) to increase the facility from $1.0 billion to $1.25 billion which expires on October 24, 2027.

The revolving credit facility contains up to $250 million sublimit, with $150 million committed, for the issuance of letters of credit and a $75 million sublimit for U.S.

dollar swingline loans and $75 million for swingline loans in euro or British pounds sterling.

The Credit Facility allows for borrowings in British pounds sterling, euro and U.S.

Subject to certain conditions, the Company has the option to increase the credit facility by up to an additional $500 million by requesting additional commitments from existing or new lenders.

Fees and interest on borrowings vary based upon the Company's corporate credit rating and will be based, in the case of letter of credit fees, on a margin, and in the case of interest, on a margin over a secured overnight financing rate, as defined in the agreement, with a margin, including the facility fee, ranging from 1.00% to 1.625% or the base rate, as selected by the Company.

The applicable margin for borrowings under the credit facility, based on the Company's current credit rating is initially 1.25% including the facility fee.

As of September 30, 2022 , we had $326.3 million of borrowings and $50.9 million of stand-by letters of credit outstanding under the Credit Facility.

The remaining $652.8 million under the Credit Facility was available for borrowing.

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The Senior Notes accrue interest at a rate of 1.375% per year, payable annually in arrears on May 22 of each year, until maturity or earlier redemption.

As of June 30, 2022 , we have outstanding €600 million ( $628.9 million ) principal amount of the Senior Notes.

As of September 30, 2022 , we have outstanding €600 million ( $588.4 million ) principal amount of the Senior Notes.

In addition, we may redeem some or all of these notes on or after February 22, 2026 at their principal amount plus any accrued and unpaid interest.

Uncommitted Loan s - On May 25, 2022 and June 24, 2022, we entered into two separate uncommitted credit agreements for $300 million and $150 million, respectively, that expire no later than November 30, 2022 and June 23, 2023, respectively.

Both credit agreements are fully drawn and outstanding at June 30, 2022.

The credit agreements were entered into for the sole purpose of providing vault cash for ATMs.

Each loan entered into under the $300 million agreement accrues interest at the rate per annum equal to the secured overnight financing rate (“SOFR”) plus 1.00%.

Each loan entered into under the $150 million agreement is a Prime rate loan, a Bloomberg Short-term Bank Yield ("BSBY") rate loan or bears interest at the rate agreed to by the lender and the Company at the time such loan is made.

Uncommitted Loan s - On May 25, 2022, we entered into an uncommitted credit agreement for $300 million that expires no later than November 30, 2022.

The credit agreement is fully drawn and outstanding at September 30, 2022.

The credit agreement was entered into for the sole purpose of providing vault cash for ATMs .

Each loan entered into under this agreement accrues interest at the rate per annum equal to the secured overnight financing rate (“SOFR”) plus 1.00 %.

On June 24, 2022, we entered into an uncommitted credit agreement for $150 million that expires no later than June 23, 2023.

The credit agreement was entered into for the sole purpose of providing vault cash for ATMs.

The loan had no balance at September 30, 2022.

Each loan entered into under the agreement was either a Prime rate loan, a Bloomberg Short-term Bank Yield ("BSBY") rate loan or bears interest at the rate agreed to by the lender and the Company at the time such loan is made.

Other debt obligations — Certain of our subsidiaries have available credit lines and overdraft facilities to generally supplement short-term working capital requirements, when necessary.

There were $0.4 million and $0.9 million outstanding under these other obligation arrangements as of June 30, 2022 and December 31, 2021 , respectively.

There were $3.6 million and $0.9 million outstanding under these other obligation arrangements as of September 30, 2022 and December 31, 2021 , respectively.

Other uses of capital

Capital expenditures and needs - Total capital expenditures for the s ix months ended June 30, 2022 were $53.1 million .

Capital expenditures and needs - Total capital expenditures for the nine months ended September 30, 2022 were $79.4 million .

These capital expenditures were primarily for the purchase and installation of ATMs in key under-penetrated markets, the purchase of POS terminals for the epay and Money Transfer Segments, and office, data center and company store computer equipment and software.

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Our liability under such indemnification provisions may be subject to time and materiality limitations, monetary caps and other conditions and defenses.

As of June 30, 2022 , there were no material changes from the disclosure in our Annual Report on Form 10-K for the year ended December 31, 2021 .

To date, we are not aware of any significant claims made by the indemnified parties or parties to whom we have provided guarantees on behalf of our subsidiaries and, accordingly, no liabilities have been recorded as of June 30, 2022 .

As of September 30, 2022 , there were no material changes from the disclosure in our Annual Report on Form 10-K for the year ended December 31, 2021 .

See also Note 14, Commitments, to the unaudited consolidated financial statements included elsewhere in this report.

CONTRACTUAL OBLIGATIONS

As of June 30, 2022 , there have been no material changes outside the ordinary course of business in our future contractual obligations from the amounts reported within our Annual Report on Form 10-K for the year ended December 31, 2021 .

As of September 30, 2022 , there have been no material changes outside the ordinary course of business in our future contractual obligations from the amounts reported within our Annual Report on Form 10-K for the year ended December 31, 2021 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis