David Scharf: Got it. Great. Thanks so much.
Operator: Our next question comes from Mike Grondahl with Northland Securities.
Mike Grondahl: Hey, good morning, guys. Did you guys call out the revenue number from La Nacional and iTransfers? I’m trying to just back into an organic growth rate in 4Q.
Andras Bende: Yeah, sure, Mike, because we’re all on the main call together. La Nacional in Q4 was about $18 million. iTransfer in Q4 was about $5 million. Which means your organic growth in the core was about little under 5.5%.
Mike Grondahl: Got it. And then last quarter, you guys kind of talked about, I’ll call it, four growth drivers that you were sort of strategically heading towards or implementing. One was sort of targeted counteroffers, one was new agents, one was some overall selected pricing actions, and I think kind of new market strategies. Could you handicap like which one of those four you’re ahead on? Maybe which ones you’re kind of behind on? Just let us know how each of those four are going?
Andras Bende: Yeah, I think the most important and the one that we’re doing the best in is the targeted offerings. So that’s what we mentioned in the text was that that program is going quite well, and we’ve executed well against it. We’ve brought in tens of thousands of wires on that program, which we’re essentially paying a little bit of commission up front, let’s say, to an agent, and then we’re reducing the amount of payment that the agent gets over time. So it doesn’t have a huge impact on our commission that the agent gets or our gross margin over time, but it’s more of an upfront payment to bring back wires that we haven’t had in the past. That has done quite well, and I think we’re executing and continuing to execute against that.
The second one with new agents, we continue to drive growth for our new agents, and that’s going well as well. Targeting that growth in specific zip codes is the thing that we’re going to spend more time on. And that will be sort of a targeted along with new agents, which will be this sort of new price offering where we’ll be a little bit more aggressive with both the agent and the consumer. But again, I want to highlight and make sure, I underscore, that does not mean we’re going to where we have four plus million wires, and we have it at x margin, we’re not going and discounting there. We’re being aggressive with price where we’re not, where we’re not getting wires, where we have a small level of market penetration, where we might not be serving in the zip code at all, and we feel both of those strategies are going well.
The overall — actually, our overall approach to the market has been better margins. We’ve brought the pricing component into finance, and Andrew Kugbei, who is head of the sales planning and analysis, has been running the pricing and we’ve actually done much better in terms of margins versus the margins in the year ago. And that’s been done because we’ve done less of sort of wholesale changes in the market and more specific changes related to when we get wires as a benefit of moving price. New markets, I’m not sure what that piece was. I think we have Canada, we certainly have the growth in La Nacional. Let me touch on La Nacional for a minute. We think La Nacional has got a lot of pent-up growth in that it became really a Dominican Republic product.
And we’ve now given them the payer relationships we have in Mexico and our payer cost to Mexico. And we’ve already seen an uptick in those wires, there’s a lot more to do. There’s a lot more putting them on our payer network and a lot of volume of transactions in their retail network, both the company stores and the retailers that have not been tapped in the past because La Nacional was focused primarily on the Dominican Republic. So, we still see a lot of growth opportunity there. And then additionally, Europe has been growing well, we think there’s a lot more opportunity in Italy. We think — we’re looking at things in other parts of Europe as well. So those are the new markets where growth will come from.
Mike Grondahl: Got it. In terms of the buyback, did I hear correctly, you guys had been kind of programmatically buying at $10 million a quarter starting 1Q ’24? That’s going to uptick to $20 million a quarter?
Bob Lisy: That’s right, Mike. And we’ll also be active in terms of block purchases if they’re going to benefit the shareholder as well. But we feel that we’ll have an underlying $20 million that we’ll be able to pick up each quarter. We have some price parameters built into that as well. So it’s not at all cost but I feel pretty good about being able to pick up $20 million worth a quarter and then blocks on top of that.
Mike Grondahl: Got it. And just lastly, are you able to put like a revenue range or in terms of growth, what Mexico is acting as a headwind for ’24, like, five points of revenue growth, four points, seven points. What do you see that headwind as roughly as compared to, like, ’23?
Andras Bende: Yeah, I think right now, we see that that the Mexico growth in fourth quarter as an industry was only at 3.5%. And our assumptions in the plan we presented assumed that kind of growth sustaining itself throughout 2024. So we’re not dependent on that coming back at all if the market starts to come back. Just to put in perspective, in Q2 of 2020, which was the height of COVID, the market grew at 3.6%, And in Q4 of 2023, it grew at 3.5%. So, it actually grew a tenth of a percent slower than it did during COVID in Q4, and we kind of projected that through ’24. Our upside is these investments that we’re making in sales from a growth perspective that are totally been assimilated into our cost structure because we’ve done a lot of zero-based budgeting as well, that’s eliminated some, I think, unjustified, or inefficient costs, right, that we’ve now put back into the sales perspective.
