Slide 1: Payroll & HR Solutions that help Businesses Grow
Payroll & HR Solutions that help Businesses Grow Investor Presentation November 2023
Slide 2: Safe Harbor Statement
Safe Harbor Statement (Under the Private Securities Litigation Reform Act of 1995) Forward Looking Statements This presentat ion contains certa in statem ents made b y ma nagem ent that may const itute “f orward-looking” statem ents w ithin t he meaning of t he safe ha rbor provis ions of the U.S. P
Slide 3: Chairman's Comments
Chairman’s Comments • Asure’s strong momentum continued in the third quarter with results driven by solid execution across the business. Our continued investment in products and technologies that we believe make a difference for our customers is creating value for them and translating into more busi
Slide 4: Company Overview
Company Overview By the Numbers Leading provider of Human Capital Management (HCM) software and services that help companies stay compliant, pay their employees, and save money. $118-$120M 92% 19%-20% FY2023 Recurring FY2023 Revenue Revenue(2) Adjusted EBITDA : ASUR Guidance(5) Margin Guidance(4) ~1
Slide 5: Asure's Next Chapter Has Yet to be Written
Asure’s Next Chapter Has Yet to be Written The Biggest* HCM Company You’ve Never Heard of Asure has the culture and growth characteristics of a young pure- play HCM business wrapped in the framework of a 35-year-old publicly-traded company. $118 to In just 7 years, since acquiring Mangrove HCM in 20
Slide 6: The Next Chapter Goes Beyond Traditional HCM
The Next Chapter Goes Beyond Traditional HCM HCM + Marketplace Services = HCM Data Company Employers Employees HCM providers seek national distribution and the stickiness that arketplace Consumer goods and services firms rely on real-time, life-event data to comes from attaching to payroll. M get in
Slide 7: Valuation Expansion Opportunity
Valuation Expansion Opportunity EV / Revenue 1.4x 4.5x 4.9x 4.9x 5.3x 7.4x Revenue Growth 7% 17% 6% 13% 18% 6% EBITDA Margin 21% 30% 30% 41% 34% 45% Revenue Growth + EBITDA 28% 47% 36% 54% 52% 51% Margin Implied Asure Stock Price* $8 $22 $25 $25 $27 $37 at Same Valuations *Data source: Capital IQ *N
Slide 8: HCM Business: Large and Growing Addressable Market
HCM Business Large and Growing Addressable Market Market Size Market Tailwinds SMB shift to cloud software driving US HCM TAM $90B+ US HCM TAM growth (CAGR 7.6% through 2025 and reach $90B+) Total US HCM TAM is growing at 7.6% CAGR (1) Tight labor markets during COVID-19 has accelerated $45B+ Near-T
Slide 9: End-To-End HCM Solution
End-To-End HCM Solution Powering growth for 100K employers Empowering freedom for 1.7M employees • Labor Law Compliance • Fully Outsourced HR also includes: HR • HR Online Library o Omni-channel employee relations COMPLIA • HR native to payroll software for o Compliance guidance: NC HR mgr & emp and
Slide 10: Asure Payroll Tax Management
Asure Payroll Tax Management Asure’s 2020 acquisition and integration of Payroll Tax Management improved our ability to efficiently manage payroll taxes, reconcile funds, and file taxes. We now also offer that platform as a service to large enterprises, HCM vendors, and firms that calculate tax cred
Slide 11: HCM Business | Competitive Landscape
HCM Business | Competitive Landscape Micro & Small Businesses ADP and Paychex are Asure’s largest competitors with more presence in major markets, but they also create the largest opportunity with significant churn in SMB markets. Many SMBs rely on their CPA or in-house software like QuickBooks. CPA
Slide 12: HCM Direct | How, Why, and Where Asure Wins
HCM Direct | How, Why, and Where Asure Wins How Clients Find Asure Why Clients Choose Asure* SMB Trusted Advisor Universe 1 or 2 (Not Important) 3 or 4 5 or 6 7 or 8 9 or 10 (Extremely Important) High-Quality Customer Service 4% 88% Bank 4.4k Has the specific features I need 16% 68% Benefit CPA Rela
Slide 13: Two Sales Channels, One HCM Platform
Two Sales Channels One HCM Direct Platform Sales 15,000 Clients 400K Employees 100k Employers 1.7M Employees Same Tech for both sales channels improves R&D efficiency and creates operating leverage Acme Payroll _________________________ Acme Payroll Hosted By White-label Resellers 85,000 Clients 1.3
Slide 14: HCM Indirect | Strategic Growth, Reseller Roll-Up
HCM Indirect | Strategic Growth, Reseller Roll-Up ~$200M+ 200+ Resellers • Their top line ~10 to 15x+ our license fees • Highly accretive acquisitions Reseller • Clients already use Asure’s software Markup o No data conversion o No software migration ~$14M o No user retraining Pre-Acquisition Asure
Slide 15: HCM Growth Model
M&A Growth Lifetime Value Accretive Compounding Growing Clients Employers grow staff annualized impact acquisitions HCM ~2% each year TOTAL Growth Model STRATEGIC Direct Sales ~10% ~20% Sales reps with industry experience SAME 8-10 Years STORE PRICING 2-4% Long-term Clients stay SALES growth model ~
Slide 16: Marketplace Success Starts with Employee Data
Marketplace Success Starts with Employee Data Today’s Data Set ~100k Employers Marketplace 1.7M Employees Compliance Earned Wage Access Ways to Monetize Recruiting HCM Retirement • Revenue share 401k Payroll, Tax, HR, Benefits • Referral fees and Time & Attendance data Income • Transaction fees SMB
Slide 17: Marketplace Case Study | Employment Verification
Marketplace Case Study | Employment Verification Equifax provides a faster, more private transfer of information to verifiers on employers' behalf. The service is governed by the Fair Credit Reporting Act (FCRA) and only accessed by credentialed verifiers with auditable, permissible purpose. How Asu
Slide 18: How the Marketplace Powers Growth for Employers and Empowers Freedom for Employees
How the Marketplace Powers Growth for Employers and Empowers Freedom for Employees Offering Earned Wage Access so employees can access wages on-demand helps SMBs in the war for talent 401k built for Small Businesses helps SMBs compete with large corporations and helps employees plan retirement Autom
Slide 19: Margin Expands with Growth, as Revenue Composition Changes
Margin Expands with growth, as Revenue Composition Changes HCM Revenue • Poised to continue double digit growth • Acquired “Indirect” clients become “HCM Direct” • HCM Direct is more profitable than Indirect because we capture 100% of the top line Future State Revenue growth is expected to Marketpla
Slide 20: And With Scale… Comes Even More Margin Expansion
And With Scale… Comes Even More Margin Expansion With characteristics of a young pure-play HCM business, we’re getting With line-of-sight 20%+ better every day. to Adjusted EBITDA Margin 2023 Initiatives include: • New omni-channel support platform plugged into CRM Standardize Simplify Self-Service
Slide 21: Profit Expands as Revenue Composition Changes and We Achieve Scale
Profit Expands as Revenue Composition changes and we achieve Scale $400 As Revenue Grows… $300 Gross Profit Adjusted EBITDA Approaches ~30% $200 Operating Income Approaches ~20% Net Income (Loss) $150 $125 Total Revenue $100 $140 $120 $100 $80 $80 $65 $50 $70 $35$15 $35 $20 $25 $10 $5 $15 $30 $5 ($5
Slide 22: C-Suite with Proven Track Record of Growth
C-Suite with Proven Track Record of Growth Pat Goepel Eyal Goldstein Yasmine Rodriguez John Pence Chairman & CEO President & CRO Chief Technology Officer CFO www.asuresoftware.com 22
Slide 23: Board of Directors
Board of Directors Asure’s board has decades of industry experience optimizing and building fast growing HCM companies. Their tremendous depth in M&A, Finance, Technology, HR, and Sales & Marketing has helped them drive organic and inorganic growth while creating shareholder value in the HCM space P
Slide 24: Select Financial Data
Select Financial Data 24
Slide 25: 3Q23 Financial Highlights
3Q23 Financial Highlights Total Recurring Non-GAAP Adjusted Revenue Revenue Gross Profit Gross Profit Net Income EBITDA $29.3 $23.8 $22.4 $21.3 $6.2 YoY YoY YoY YoY YoY YoY 34% 19% 56% 50% $2.3m+ 245% $(2.2) *All figures presented in millions 25
Slide 26: Growth Results
YoY Revenue: 3Q22 Bridge to 3Q23 QoQ Revenue: 2Q23 Bridge to 3Q23 34.0M 34.0M 32.0M 32.0M 30.0M 28.0M 30.0M 28.0M 3.6% Growth Results 33.9% 26.0M 26.0M 24.0M 24.0M 30.4M 29.3M 29.3M 22.0M 22.0M Year over year 20.0M 20.0M 21.9M 18.0M 18.0M 16.0M 16.0M performance 3Q Organic 3Q 2Q Organic 3Q 22 Growth
Slide 27: Strong Financial Profile with Significant Near-Term Growth
Strong Financial Profile with Significant Near-Term Growth Revenue Adjusted EBITDA $118M - $120M 19%-20% $96M $22M - $24M $76M 12% $12M 10% $8M FY 2021A FY 2022A FY 2023E Guidance FY 2021A FY 2022A FY 2023E Guidance Note: FY Ending December 31 27
Slide 28: Select Financial Data
Select Financial Data : ASUR in $Millions 3Q22 2Q23 3Q23 Cash and Equivalents 10.9 21.6 32.8 Total Equity 144.6 146.8 191.7 Debt 34.4 36.8 2.8 Client Funds Assets 182.0 186.5 172.5 Outstanding Shares (as of 09-30-2023) ~24.9M Enterprise Value (as of 11-10-2023) $176.3M Average Daily Volume 90 day ~2
Slide 29: Disclosure Regarding Non-GAAP and Adjusted Financial Measures (1 of 4)
Disclosure Regarding Non-GAAP and Adjusted Financial Measures (1 of 4) This presentation includes information about bookings, non-GAAP gross profit, non-GAAP sales and marketing expense, non-GAAP general and administrative expense, non-GAAP research and development expense, EBITDA, EBITDA margin, ad
Slide 30: Disclosure Regarding Non-GAAP and Adjusted Financial Measures (2 of 4)
Disclosure Regarding Non-GAAP and Adjusted Financial Measures (2 of 4) Non-GAAP research and development expense differs from research and development expense in that it excludes share-based compensation and one- time items. EBITDA differs from net income (loss) in that it excludes items such as int
Slide 31: Disclosure Regarding Non-GAAP and Adjusted Financial Measures (3 of 4)
Disclosure Regarding Non-GAAP and Adjusted Financial Measures (3 of 4) Depreciation. The Company excludes depreciation of fixed assets. Also included in the expense is the depreciation of capitalized software costs. Amortization of Purchased Intangibles. The Company views amortization of acquisition
Slide 32: Disclosure Regarding Non-GAAP and Adjusted Financial Measures (4 of 4)
Disclosure Regarding Non-GAAP and Adjusted Financial Measures (4 of 4) One-Time Expenses. The Company’s adjusted financial measures exclude the following costs to normalize comparable reporting periods, as these are generally non-recurring expenses that do not reflect the ongoing operational results
Slide 33: Appendix 1: Valuation Comparisons
Appendix 1 Valuation Comparisons 33
Slide 34: Comparable Public Companies Operational Detail
Comparable Public Companies Operational Detail LTM Margins Revenue EBITDA Company Gross EBITDA LTM CY2023P CY2024P LTM CY2023P CY2024P High Growth Payroll Paycom Software, Inc. 87.1% 31.4% $ 1,629.7 $ 1,682.5 $ 1,899.7 $ 511.0 $ 708.8 $ 775.1 Paylocity Holding Corporation 69.1 17.7 1,238.9 1,290.4 1
Slide 35: Comparable Public Companies Valuation Detail
Comparable Public Companies Valuation Detail Closing % of Enterprise Value Multiples Price 52 Week Market Enterprise Revenue EBITDA Company (11/10/23) High % Float Cap Net Cash Value LTM CY2023P CY2024P LTM CY2023P CY2024P High Growth Payroll Paycom Software, Inc. $ 167.83 44.9% 84.5% $ 9,683.9 $ 45
Slide 36: Appendix 2: Unaudited Supplemental Quarterly Financial Information
Appendix 2 Unaudited Supplemental Quarterly Financial Information 36
Slide 37: Information Regarding Unaudited Supplemental Quarterly Financial Information
Information Regarding Unaudited Supplemental Quarterly Financial Information • The Unaudited Supplemental Quarterly Financial Information in the appendix of this presentation reflect Asure Software, Inc.’s (the “Company”) financial statements for the periods presented give effect in prior periods ce
Slide 38: Balance Sheets (Unaudited)
Balance Sheets (Unaudited) Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Jun. 30, 2023 Sep. 30, 2023 ASSETS Current assets: Cash and cash equivalents $ 13,427 $ 12,054 $ 14,594 $ 10,885 $ 17,010 $ 21,438 $ 21,613 $ 32,787 Accounts receivable, net of allowance fo
Slide 39: Income Statements (Unaudited)
Income Statements (Unaudited) THREE MONTHS ENDED Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Jun. 30, 2023 Sep. 30, 2023 Revenue: Recurring $ 19,390 $ 23,004 $ 19,014 $ 20,059 $ 24,146 $ 27,956 $ 22,960 $ 23,833 Professional services, hardware and other 1,723
Slide 40: Statements of Cash Flows (Unaudited)
Statements of Cash Flows (Unaudited) THREE MONTHS ENDED Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Jun. 30, 2023 Sep. 30, 2023 Cash flows from operating activities: Net (loss) income $ (4,301) $ (3,017) $ (5,860) $ (4,533) $ (1,056) $ 339 $ (3,765) $ (2,206)
Slide 41: Non-GAAP Reconciliation (Unaudited, 1 of 2)
Non-GAAP Reconciliation (Unaudited, 1 of 2) THREE MONTHS ENDED Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Jun. 30, 2023 Sep. 30, 2023 Revenue $ 21,113 $ 24,333 $ 20,300 $ 21,903 $ 29,292 $ 33,064 $ 30,420 $ 29,334 GAAP to Non-GAAP Gross Profit Gross Profit $
Slide 42: Non-GAAP Reconciliation (Unaudited, 2 of 2)
Non-GAAP Reconciliation (Unaudited, 2 of 2) THREE MONTHS ENDED Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Jun. 30, 2023 Sep. 30, 2023 Revenue $ 21,113 $ 24,333 $ 20,300 $ 21,903 $ 29,292 $ 33,064 $ 30,420 $ 29,334 GAAP Net income (loss) to Adjusted EBITDA GAA