Slide 1: Payroll & HR Solutions that help Businesses Grow
Payroll & HR Solutions that help Businesses Grow Investor Presentation May 2023
Slide 2: Safe Harbor Statement
Safe Harbor Statement (Under the Private Securities Litigation Reform Act of 1995) Forward Looking Statements This presentation contains certain statements made by management that may constitute “forward-looking” statements within the meaning of the safe harbor provisions of the U.S. Private Securit
Slide 3: Chairman's Comments
Chairman’s Comments • Asure’s strong business performance reflects positive client reception to the many investments and product enhancements we have made across our organization. It also reflects our efforts to streamline and consolidate our business processes so that we can take advantage of new o
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. $111-$113M 92% 17%-18% 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. $111 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 Consumer goods and services firms distribution and the stickiness that rely on real-time, life-event data to comes from attaching to payroll. get in front of cus
Slide 7: Valuation Expansion Opportunity
Valuation Expansion Opportunity EV / Revenue 2.7x 4.9x 6.6x 7.4x 7.6x 8.6x Revenue Growth 17% 10% 25% 8% 32% 25% EBITDA Margin 17% 28% 28% 45% 31% 42% Revenue Growth + EBITDA 34% 38% 53% 53% 63% 67% Margin Implied Asure Stock Price* at $14 $25 $33 $37 $38 $43 Same Valuations *Data source: Capital IQ
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-Te
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 Online Library o Omni-channel employee relations • HR native to payroll software for o Compliance guidance: HR mgr & emp and self-service
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
Lifetime Value M&A Growth 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 for long time
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 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 John Pence Chairman & CEO President & CRO CFO Todd Waletzki Yasmine Rodriguez Chief of Staff Chief Technology Officer 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
©) Asure Select Financial Data
Slide 25: 1Q23 Financial Highlights
1Q23 Financial Highlights Total Recurring Non-GAAP Adjusted Revenue Revenue Gross Profit Gross Profit Net Income EBITDA $33.1 $28.0 $25.7 $24.4 YoY YoY YoY YoY YoY YoY $8.2 36% 284% 58% 54% $3.4m+ 140% $0.3 *All figures presented in millions 25
Slide 26: Growth Results
YoY Revenue: 1Q22 Bridge to 1Q23 QoQ Revenue: 4Q22 Bridge to 1Q23 12.9% 35.9% Growth Results 33.1M 29.3M 33.1M 24.3M Year over year performance 1Q Organic 1Q 4Q Organic 1Q 22 Growth 23 22 Growth 23 Waterfall Definitions • Organic Growth consists of the net revenue generated from new bookings, price
Slide 27: Strong Financial Profile with Significant Near-Term Growth
Strong Financial Profile with Significant Near-Term Growth Revenue Adjusted EBITDA $111M - $113M 17%-18% $96M $19M - $20M $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 in $Millions 1Q22 4Q22 1Q23 : ASUR Cash and Equivalents 12.1 17.0 21.4 Total Equity 154.9 145.1 149.2 Debt 35.8 34.9 35.9 Client Funds Assets 238.7 203.6 223.5 Outstanding Shares (as of 03-31-2023) ~21.0M Enterprise Value (as of 05-05-2023) $294.0M Average Daily Volume 90 day ~
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 CY2022 CY2023P LTM CY2022 CY2023P High Growth Payroll Paycom Software, Inc. 87.5% 31.4% $ 1,473.3 $ 1,375.2 $ 1,712.5 $ 462.9 $ 424.1 $ 717.5 Paylocity Holding Corporation 67.4 12.0 1,001.2 973.7 1,284
Slide 35: Comparable Public Companies Valuation Detail
Comparable Public Companies Valuation Detail Closing % of Price 52 Week Market Enterprise Revenues EBITDA Company 5/5/2023 High Cap Net Cash Value CY2022 CY2023P CY2022 CY2023P High Growth Payroll Paycom Software, Inc. $ 272.63 67.7% $ 15,109.9 $ 435.6 $ 14,674.4 10.7x 8.6x 34.6x 20.5x Paylocity Hol
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) June 30, 2021 Sept. 30, 2021 Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 20,292 $ 11,506 $ 13,427 $ 12,054 $ 14,594 $ 10,885 $ 17,010 $ 21,438 Accounts receivable, net of allowance f
Slide 39: Income Statements (Unaudited)
Income Statements (Unaudited) THREE MONTHS ENDED June 30, 2021 Sept. 30, 2021 Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Revenue: Recurring $ 16,072 $ 16,374 $ 19,390 $ 23,004 $ 19,014 $ 20,059 $ 24,146 $ 27,956 Professional services, hardware and other 1,096
Slide 40: Statements of Cash Flows (Unaudited)
Statements of Cash Flows (Unaudited) THREE MONTHS ENDED June 30, 2021 Sept. 30, 2021 Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Cash flows from operating activities: Net (loss) income $ 3,764 $ 5,328 $ (4,301) $ (3,017) $ (5,860) $ (4,533) $ (1,056) $ 339 Adj
Slide 41: Non-GAAP Reconciliation (Unaudited, 1 of 2)
Non-GAAP Reconciliation (Unaudited, 1 of 2) THREE MONTHS ENDED June 30, 2021 Sept. 30, 2021 Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Dec. 31, 2022 Revenue $ 17,168 $ 17,981 $ 21,113 $ 24,333 $ 20,300 $ 21,903 $ 29,292 $ 33,064 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 June 30, 2021 Sept. 30, 2021 Dec. 31, 2021 Mar. 31, 2022 Jun. 30, 2022 Sep. 30, 2022 Dec. 31, 2022 Dec. 31, 2022 Revenue $ 17,168 $ 17,981 $ 21,113 $ 24,333 $ 20,300 $ 21,903 $ 29,292 $ 33,064 GAAP Net income (loss) to Adjusted EBITDA GA