Euronet Worldwide, Inc. · NASDAQ:EEFT
Euronet Worldwide — FY2003 Earnings Presentation
42 slides from Euronet Worldwide's earnings presentation, Feb 20, 2004
Slide 1: Year-End 2003 Corporate Results
Symbol: EEFT www.euronetworldwide.com Welcome to Euronet Worldwide Year-End 2003 Corporate Results February 20, 2004 Presenters Michael J. Brown, Chairman & CEO Rick L. Weller, EVP & CFO Jeff B. Newman, EVP & General Counsel
Slide 2: Forward-Looking Statements
30, 2003; Forward-Looking Statements Statements contained in this presentation, which concern Euronet’s or its management’s intentions, expectations, or predictions of future performance, are forward-looking statements. Euronet’s actual results may vary materially from those anticipated in such forw
Slide 3: Year-End 2003 Financial Report
Year-End 2003 Financial Report Rick L. Weller Chief Financial Officer
Slide 4: Financial Highlights Q4 2003
) Financial Highlights $5.7 million (excluding FX and discontinued op losses) excluding FX $70.1 million $8.8 million increase over Q4 2002 32% increase over $53.1 million in Q3 2003 277% increase over Q4 2002 $6.6 million change over last year’s ($0.9) million $0.08 Quarterly 54% increase over $3.7
Slide 5: Financial Highlights 2003 Annual
$13.3 million Financial Highlights $204.4 million $25.4 million Annual 188% increase over $71.0 million in annual 2002 $13.7 million change over last year’s ($0.4) million 176% increase over $9.2 million in annual 2002 $0.13* Compared to ($0.19)* for Q4 2003 2003 Financial Report: Revenue – > Operat
Slide 6: Quarterly Consolidated Revenue
Q4 03 : Q3 03 Q2 03 Q1 03 Quarterly Consolidated Revenue Q4 02 Q4 2003 Financial Report 80 70 60 50 40 30 20 10 0 Millions USD
Slide 7: Quarterly Operating Results & EBITDA
EBITDA Q4 03 Op Income : EBITDA Op Q3 03 Income EBITDA Q2 03 Op Income EBITDA Q1 03 Op Income EBITDA Q4 02 Quarterly Consolidated Op Results & EBITDA Op Loss Q4 2003 Financial Report 10 8 6 4 2 0 -2 Millions USD
Slide 8: Annual Consolidated Revenue Growth
2003 2002 2001 2000 2003 Financial Report: Annual Consolidated Revenue Growth 225 200 175 150 125 100 75 50 25 0 Millions USD
Slide 9: Consolidated Operating Results & EBITDA
EBITDA 2003 Op Income : EBITDA 2002 Op Loss EBITDA 2001 Op Loss Consolidated Op Results & EBITDA EBITDA 2000 Op Loss 2003 Financial Report Annual 30 20 10 - (10) (20) (30) (40) USD Millions
Slide 10: Euronet's Business Segments
Software Solutions, including R&D Corporate Prepaid Processing Europe e-pay transact Asia Pacific U.S.-PaySpot EMEA Asia Pacific Euronet’s Business Segments EFT Processing More than 90% of revenues are recurring
Slide 11: Quarterly Transaction Growth
Prepaid EFT Q4 03 Prepaid EFT Q3 03 Prepaid EFT Q2 03 Prepaid EFT Q1 03 EFT & Prepaid Processing Combined EFT Q4 02 Quarterly Transaction Growth: 80 70 60 50 40 30 20 10 0 Millions
Slide 12: Quarterly Processing Revenue Growth
Q4 03 Q3 03 Q2 03 Q1 03 EFT & Prepaid Processing Combined Q4 02 Quarterly Processing Revenue Growth: 70 60 50 40 30 20 10 0 Millions USD
Slide 13: Sequential Quarterly Results Comparison by Segment
Q4 03 $4.0 5.9 0.8 10.7 (0.1) (1.8) $8.8 EBITDA Q3 03 $4.1 3.9 0.7 8.7 - (1.9) $6.8 $2.3 4.7 0.5 7.5 - (1.8) $5.7 Q4 03 Operating Income Q3 03 $2.3 3.0 0.4 5.7 (0.1) (1.9) $3.7 4.2 -USD Millions Revenue Q4 03 $15.8 50.1 70.1 - $70.1 Business Segments: Sequential Quarterly Results Comparison Q3 03 $1
Slide 14: Balance Sheet – Debt Movement
: (USD Millions) 68.7 4.9 4.8 (8.1) (5.3) 65.0 Other Items $ $ Q4 2003 Financial Report Balance Sheet – Debt at end of Q3 2003 Exchange rate impact Additional borrowings Conversion of debt Payments Debt at end of Q4 2003 • • • • • •
Slide 15: Strengthened Balance Sheet & Financial Position
2003 $19.1 305.4 190.0 65.0 81.9 44% 1.9x 1.3x 2002 $12.0 66.5 66.5 44.4 6.2 88% 6.1x 4.5x USD Millions excluding Trust Accounts Q4 2003 Financial Report: 2003 Strengthened Balance Sheet & Financial Position Debt to Total Capital Total Debt to Annualized Q4 EBITDA Multiple Net Debt to Annualized Q4
Slide 16: Consistent Quarterly Improvement in EPS
$0.13 Q4 ‘03 Q3 ‘03 Q2 ‘03 Consistent Quarterly Improvement Q1 ‘03 Earnings per shares excludes FX, gain on sale of U.K. ATM network and losses from discontinued operations. Includes the rounded effects of the quarters. 2003 Fully Diluted EPS: $0.10 $0.08 $0.06 $0.04 $0.02 $- $(0.02) $(0.04) Notes:
Slide 17: Business Overview
Business Overview Michael J. Brown Chairman & CEO
Slide 18: Euronet's Business Segments
Software Solutions, including R&D Corporate Prepaid Processing Europe e-pay transact Asia Pacific U.S.-PaySpot EMEA Asia Pacific Euronet’s Business Segments EFT Processing More than 90% of revenues are recurring
Slide 19: EFT Processing Segment
ayaoyos EFT Processing Segment
Slide 20: EFT Processing Today
• in 2003 Today processor India borders Q4 network & connections contract in transactions ATM across shared Hungary card live under & cash Processing processing bank ATMs centers: live EFT pan-European nationwide – terminals transactions/month annualized largest largest POS ATMs additional million p
Slide 21: EFT Processing Operating Income & EBITDA
EBITDA Op Income Q4 ‘03 EBITDA Q3 ‘03 Op Income EBITDA : Q2 ‘03 Op Income EBITDA Q1 ‘03 Op Income EFT ProcessingOperating Income & EBITDA 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 Millions USD
Slide 22: EFT Processing Q4 2003 Financial Highlights
• Pacific 0.5 • Millions) Asia $ ($0.4) ($0.4) (USD $2.7 $4.4 EMEA $15.3 • Highlights EMEA • $2.3 $4.0 in EMEA • Total $15.8 margin in • Financial margin • income EBITDA • Processing: 2003 Income op • EFT Q4 Revenue Op EBITDA 18% 29% • • • •
Slide 23: EFT Processing Q4 2003 Business Highlights
4 65 ATMs now 2,264 ATMs connected - : rollout in process – technical interface certifications in process – 251 outsourced ATMs now live 9 banks, 2 mobile operators Romania – Network Participation agreement outsourced ATMs – India shared network – HW/Software upgrade doubled network capacity contrac
Slide 24: ATM Categories by Quarter
Total After Install 854 1,579 2,409 4,842 contract in Under Contract 12/31/03 N/A 772 720 1,492 Live 12/31/03 854 807 1,689 3,350 Live 09/30/03 831* 702 1,721* 3,254 EFT Processing: ATM Categories by Quarter Devices ATM Category 1 Euronet-owned & branded ATM Category 2 Euronet-owned, bank-branded AT
Slide 25: Q4 2003 ATMs by Country
921 433 0 12 Poland Total: Hungary Total: Romania Total: Kosovo Total: Greece Total: 127 India Total: 88 Egypt Total: Q4 2003 ATMs by Country 841 405 110 Slovakia 180 160 EFT Processing: United Kingdom Total: Germany Total: Czech Republic Total: Total: Croatia Total:
Slide 26: Q4 2003 ATM Categories by Country
Total 921 841 433 405 73 180 160 110 88 127 12 3,350 Category 3 41 841 286 3 73 180 160 5 88 0 12 1,689 Category 2 520 0 147 3 0 0 0 10 0 127 0 807 Q4 2003 ATM Categories by Country Category 1 360 0 0 399 0 0 0 95 0 0 0 854 EFT Processing: Country Poland U.K. Hungary Germany Greece Slovakia Croatia
Slide 27: Prepaid Processing Segment
ayaoyos Prepaid Processing Segment
Slide 28: Prepaid Processing Today
• & U.S. + Today processor & and Q4 in collected prepaid Germany partnerships national up U.K., top Processing operator many international centers: for devices transactions/month annualized Prepaid mobile carriers POS locations largest processing countries direct available + million billion Euronet
Slide 29: Prepaid Processing Operating Income & EBITDA
EBITDA Q4 ‘03 Op Income EBITDA Q3 ‘03 Op Income : EBITDA Q2 ‘03 Op Income EBITDA Q1 ‘03 Operating Income & EBITDA Op Income 7 6 5 4 3 2 1 0 Prepaid Processing Millions USD
Slide 30: Prepaid Processing Q4 2003 Financial Highlights
Q4 2003 Financial Highlights $50.1 million $4.7 million $5.9 million (November and December) $2.1 million $0.6 million $0.8 million $0.3 million 37% increase over $36.5 million in reported Q3 2003 57% increase over $3.0 million in reported Q3 2003 $5.2 million without purchase price intangible amort
Slide 31: Prepaid Processing Q4 2003 Business Highlights
in Q4 ‘03 in Q1 ‘04 roll-out starting in Nov. Germany market leader—building U.S. PaySpot – fully live in Nov. Germany Q4 2003 Business Highlights Transact – Precept – Independent retailers (added approx. 500 in U.K. & 400 in Poland) Sainsbury – U.K. Post Office – Shell New Zealand Shell Germany VNP
Slide 32: Prepaid Markets Summary and Points of Sale
points of sale (Q1 Precept adds 4,500) 300 POS 2,800 POS 102,000 POS 9,500 POS 4,700 POS 700 POS 1,000 POS 3,900 POS 600 POS PaySpot –U.K. – Germany – Australia – New Zealand – Poland – Ireland – U.S. – Malaysia – Indonesia – Q4 2003 Business Highlights Markets Summary — > > > > > > > > > Current Pr
Slide 33: Software Solutions Segment, including R&D
Software Solutions Segment,including R&D
Slide 34: Software Solutions Financial Highlights
: including R&D YTD $15.7 million $1.4 million $2.6 million YTD $9.3 million Q4 $4.3 million $0.5 million $0.8 million Q4 $2.6 million Software backlog of $5.7 million Q4 2003 Financial Highlights Revenue Op income EBITDA Contract sales Software Solutions, Financial Highlights > > > Other Highlights
Slide 35: Software Solutions Q4 2003 Business Highlights
: including R&D Romania for ATM outsourcing network participation Q4 2003 Business Highlights Slaski Raiffeisen Software Solutions, Record sales in Q4 2003 10 new customers in 2003 Onsite implementations in 19 different countries YTD with more than 100 projects Opened customer service in Belgrade, S
Slide 36: Summary
• $8.1 ops on 2003 ATM of gain Q4 disc. • & and than FX conversion FX better international improvements leverage & recurring Q4 in excluding Services is line in owners excluding slightly leader sheet Q4, or revenue e-pay in $0.13, to Prepaid payments to is market of balance $0.08 EPS similar the and
Slide 37: Questions?
Michael Brown Chairman & CEO Rick Weller EVP & CFO Jeff Newman EVP & Corporate Counsel Questions?
Slide 38: Supplemental Data
Supplemental Data: The following schedules provided a full reconciliation of Non-GAAP Financial Measures. Management believes that EBITDA is an important measure of the Company’s current performance of business units without consideration of financing expenses, depreciation and amortization of histo
Slide 39: Reconciliation of Net Income to EBITDA – Annual
(6,514) (0.28) (3,119)—955 4,233 (4,445) (0.19) 6,253 (247) 183 (2,312) 249 (100) (419)- 9,659 9,240 12/31/2002 $ $ $ $ 11,784 0.41 201 - 9,690 3,630 0.13 7,216 (1,257) (518) 4,246—- 13,317—12,062 For the Year Ended 12/31/2003 (18,045) 25,379 $ $ $ $ to Net Income without Fx and Disc. Operation and
Slide 40: Reconciliation of Net Income to EBITDA – Quarterly
(2,236) (0.07) 150 (44) 4,497 2,367 0.08 1,858 (331) (138) 1,936—5,692 3,143 8,835 12/31/2003 $ $ $ $ 1,376 0.05 49—234 1,659 0.06 1,837 (300) (246) 740—3,690 3,067 9/30/2003 6,757 $ $ $ $ (0.10) 2—3,120 345 0.01 1,914 (273) (97) 895—2,784 3,096 (2,777) 5,880 6/30/2003 $ $ $ $ 0.57 - 1,839 (741) (0.
Slide 41: Reconciliation of Segment Net Income to EBITDA
374 - - - (2) - - 372—266 638 Software $ $ 2,627 - - 2 (254) (114) 455 2,716—940 3,656 6/30/2003 Prepaid Processing $ $ 663 - - 166 (6) 1 370 1,194—1,874 3,068 EFT Processing $ $ 244 - - - (2) - - 242—275 517 Software $ $ 1,387 - - 2 (218) (55) 408 1,524—618 2,142 3/31/2003 Prepaid Processing $ $ (U
Slide 42: Reconciliation of Segment Net Income to EBITDA
459 - - (2) 2 - - 459—323 782 Software $ $ 4,146 - 2 3 (308) (184) 1,073 4,732—1,146 5,878 12/31/2003 Prepaid Processing $ $ 971 49 (21) 129 (11) - 1,209 2,326—1,653 3,979 EFT Processing $ $ 364 - - - - - - 364—296 660 Software $ $ 9/30/2003 2,753 - - 4 (276) (292) 768 2,957—922 3,879 Prepaid Proces