Slide 1: Sinqia Acquisition & Q2 Preliminary Results
Sinqia Acquisition & Q2 Preliminary Results July 20, 2023
Slide 2: Forward-looking Statements
Forward-looking Statements Certain statements in this presentation constitute “forward-looking statements” within the meaning of, and subject to the protection of, the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties, an
Slide 3: Our Strategic Transformation
Our Strategic Transformation Identified strategic imperatives since 2015 6 1 2 3 4 5 Expand Transform BPOP Accelerate Growth through Invest in and geographic Strengthen BPOP relationship & product M&A improve service footprint in relationship increase M&A development and & infrastructure Latin Ameri
Slide 4: Brazil market attractiveness
Brazil market attractiveness Brazil is a stable market, with a large and profitable Financial Services industry Brazil has the fundamentals of a good geography Brazil has an attractive combination of lower risk, growth and size compared to other for doing business developing countries Gross financia
Slide 5: Sinqia on a page
on a page Sinqia is a leading player in the market for software for financial services Solid track record of Revenue and EBITDA Key facts Highlights growth ($M)1 Sinqia is a provider of software Client base solutions for financial institutions Largest client base in the market, with +900 clients Sin
Slide 6: Sinqia's businesses
Sinqia’s businesses Sinqia has solid businesses across 4 main verticals Core vertical solutions % Share of net revenue1 | Banks 19% | Funds 15% |Pension 22% | Consortium 17% Complete core-banking Software solutions for the asset End-to-end management Integration solutions for all solutions for both
Slide 7: Banks
Banks Addressable market for Banks is worth $ 0.8B in Brazil in 2022, and $ 0.9B in other LatAm countries Key Sinqia’s Solutions Serviceable Market Growth Drivers Core Banking Increase in banked population fueled growth in past years, and Banks | Brazil ~$0.8B will continue to do so in the future,
Slide 8: Funds
Funds Addressable market for Funds is worth $ 0.12B in Brazil in 2022, and $ 0.13B in other LatAm countries Key Sinqia’s Solutions Serviceable Market Growth Drivers Increasingly educated population, Administrations combined with easier access to Funds | Brazil ~$0.12B digital banks and brokerages
Slide 9: Pension
Pension Addressable market for Pension is worth $ 70M in Brazil in 2022, and $ 80M in other LatAm countries Key Sinqia’s Solutions Serviceable Market Growth Drivers Number of pension funds expected Asset and liability management Pension | Brazil ~$70M to remain constant in the coming years Servi
Slide 10: Consortium
Consortium Addressable market for Consortium is worth $ 30M in Brazil in 2022, and not considered in Other LatAm Key Sinqia’s Solutions Serviceable Market Growth Drivers Large growth of active members since 2019, mainly driven by higher Group management Consortium | Brazil ~$30M interest rates and
Slide 11: Business opportunities
Business opportunities The company presents a solid position and attractive opportunities across all its main BUs Core vertical solutions Banks Funds Pension Consortium No player has more than ~10-15% share overview 3-4% 14-18% 40-50% 60-85% Market Market Share Market Market Share Market Market Shar
Slide 12: Underlying markets
Underlying markets The deal will enable Evertec to tap into a much larger profit pool in LatAm Future together Core in payments Core in four Financial in LatAm services verticals in Brazil Taking: Banks Evertec payments Merchant acquiring solution to Brazil Payments and card Funds & issuer processin
Slide 13: Transaction Summary
Transaction Summary Key terms of the proposed binding agreement for the acquisition of Sinqia Purchase price and form Transaction structure Timing R$27.191 Merger of shares Shareholders meeting Price per share • Sinqia + Evertec BR (Brazilian sub), upon the • Notice to be sent early August subject t
Slide 14: Transaction financial impact
Transaction financial impact Combined entity will grow faster and be more geographic diverse, although with a slightly lower margin Illustrative Acquisition Pro Forma Combination Analysis Financial Highlights Illustrative Geographic Diversification Framework (‘23E Revenues) • Enhances revenue growth
Slide 15: Preliminary earnings – 2Q actuals versus estimates
Preliminary earnings – 2Q actuals versus estimates 2Q23 Earnings 2Q23 Estimate 2Q22 (in USD mm, except per share) Low High as recast Total Revenue $166 $167 $160.6 Adjusted EBITDA $73 $74 $74.1 Adjusted EBITDA margin 44.0% 45% 46.1% GAAP EPS – Diluted $0.42 $0.45 $0.47 Adjusted EPS $0.70 $0.72 $0.67
Slide 16: 2023 Outlook
2023 Outlook FY2023 Outlook Estimation range (in USD mm, except per share) Low High Total Revenue $652 $658 Growth, % 5.4% 6.4% GAAP EPS – Diluted $1.82 $1.91 Adjusted EPS $2.75 $2.83 Growth, % 9% 12% Capital Expenditures $70 Assumptions: Adjusted EBITDA Margin 43% 44% Tax Rate 16% 17% Share Count t
Slide 17: Together, we are the Latin American fintech leader
Together, we are the Latin American fintech leader The deal will enable Evertec to expand its current business platform within the fintech space Evertec Evertec + Sinqia Future together Powerful digital …combined with Leading Financial Technology Platform with payments engine… modern software comple
Slide 18: Appendix
Appendix
Slide 19: Non-GAAP Reconciliation Summary
Non-GAAP Reconciliation Summary The non-GAAP measures referenced in this earnings release are supplemental measures of the Company’s performance and are not required by, or presented in accordance with, accounting principles generally accepted in the United States of America (“GAAP”). They are not m
Slide 20: Outlook Summary and Reconciliation to Non-GAAP Adjusted Earnings per Share
Outlook Summary and Reconciliation to Non-GAAP Adjusted Earnings per Share 2022 2023 Outlook (As recast) (Dollar amounts in millions, except share data) Low High Revenues $652 to $658 $618 Earnings per Share (EPS) (GAAP) $1.82 to $1.91 $3.45 Per share adjustment to reconcile GAAP EPS to Non-GAAP Adj
Slide 21: Backup: Consortium model one-pager
Backup: Consortium model one-pager The Consortium is an “auto-financing” model that relies on draws to select participants to receive the prizes, which are usually high-value assets such as vehicles or houses Standard consortium model Additional information Charges an Draws monthly prizes to Partici