Slide 1: 1H 2021 Results Presentation
nexi 1H 2021 Results Presentation July 30th, 2021 1
Slide 2: Disclaimer
Disclaimer ▪ This Presentation may contain written and oral “forward-looking statements”, which includes all statements that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward-looking statements rely on a number of assumptions, expectations,
Slide 3: Key messages
Key messages Continued Strong Continued progress acceleration in volumes, financial performance in creating the back to above pre-Covid levels in Q2 European PayTech leader ▪ All macro sectors now1 growing vs ▪ 2Q Revenues +22.6% vs 2Q20 ▪ Strong Nets and SIA standalone 2019, including Travel/Leisur
Slide 4: Executive Summary
Executive Summary Covid-19 update ▪ Transaction volumes (acquiring + issuing) at 215 €B in 1H21, +15% vs 1H20 and -4% vs 1H19, with strong recovery after the easing of Covid-19 related restrictions in mid-April. Transaction volumes (acquiring + issuing) at 116 €B in 2Q21, +31% vs 2Q20 and -2% vs 2Q1
Slide 5: Executive Summary
Executive Summary Results highlights ▪ Revenues 1H21 at 539.5 €M (+12.9% y/y and +6.1% vs 1H19). Revenues 2Q21 at 280.9 €M (+22.6% y/y and +6.7% vs 2Q19) ▪ EBITDA 1H21 at 298.2 €M (+13.9% y/y and +9.9% vs 1H19). EBITDA 2Q21 at 158.3 €M (+26.9% y/y and +10.6% vs 2Q19) M&A update ▪ Nets results1: Reve
Slide 6: Transaction volumes rapidly recovering after the easing of Covid-19 restrictions
Transaction volumes rapidly recovering after the easing of Covid-19 related restrictions in the 2Q Total Acquiring and Issuing volumes - 7-days rolling % change Y/Y +36% y/y +57% y/y +33% y/y +17% y/y March ‘21 April ‘21 May ‘21 Jun ‘21 15 10% 9% 10% 10 6% 4% 8% 8% 5% 6% 6% 2% 3% 2% 5% 5% 5% 5 4% 1%
Slide 7: Strong acceleration on domestic volumes; foreign cards recovering
Strong acceleration on domestic volumes throughout the 2Q; foreign cards still negative but recovering fast Acquiring sales volumes – Italian Cards vs Foreign Cards – Y/Y trend Italian Cards Foreign Cards Total % change vs 2019 from week 15-21 Feb 30 25% 23% 26% 21% 18% 18% 20 7% 11% 13% 14% 10% 10%
Slide 8: Continued double digit growth in Basic consumption
Continued double digit growth in Basic consumption; Discretionary spending and High impact category back to positive growth vs. 2019 in LWR Acquiring volumes by category1 Product category % change Y/Y vs. 2019 2 FY20 1Q21 Apr May Jun 2Q21 LWR 44% for 41% for Basic consumption 16% 40% 33% 33% 31% 32%
Slide 9: Continued double digit growth in Basic consumption
Continued double digit growth in Basic consumption; Discretionary spending and High impact category back to positive growth vs. 2019 in LWR Acquiring sales volumes trend by consumption category – Y/Y trend % change vs 2019 from week 15-21 Feb Total High Impact Consumption Basic Consumption Discretio
Slide 10: Double digit growth on Italian cards across macro-categories
Double digit growth on Italian cards across macro-categories. Acceleration from cash to digital transactions visible across sectors Digital payments volumes for Italian cards: Digital payments volumes for Italian cards: Focus on consumption categories (Y/Y trend) Focus on specific industries (trend
Slide 11: Focus on 1H21 Results
Focus on 1H21 Results od N VAL
Slide 12: Strong Revenue and EBITDA performance in 2Q
Strong Revenue and EBITDA performance in 2Q with increased EBITDA margin. Operating leverage also confirmed by performance versus 2019 Net Revenues (€M) EBITDA (€M) EBITDA margin 54% 56% 55% 55% +6.1% +9.9% vs 1H19 vs 1H19 +12.9% +13.9% 539.5 298.2 +10.6% +6.7% 477.6 vs 2Q19 261.8 vs 2Q19 +22.6% +26
Slide 13: Merchant Services & Solutions: strong Revenue performance
Merchant Services & Solutions: strong Revenue performance supported by accelerated volume growth and improving mix Net Revenues (€M) Managed Transactions (#M) Key Highlights International ▪ Accelerating Sales volumes (representing +2.6% +26.8% 67% of value of managed transactions in 50%1 vs 1H19 Sch
Slide 14: Cards & Digital Payments: strong Revenue performance
Cards & Digital Payments: strong Revenue performance supported by accelerated volume growth and installed base positive trend Net Revenues (€M) Managed Transactions (#M) Key Highlights 38%1 International Schemes +27.0% +18.2% ▪ ~+14% y/y revenues from installed +9.8% vs 1H19 base2 in 1H21 (>60% of t
Slide 15: Digital Banking Solutions: confirmed Revenue acceleration
Digital Banking Solutions: confirmed Revenue acceleration supported by banks’ M&A related projects on top of underlying business growth Net Revenues (€M) Key Highlights 11%1 +10.0% ▪ Self banking: confirmed good progress vs 1H19 on new customers and VAS deployment. Advanced ATMs +12.6% penetration a
Slide 16: Continued strong cost control
Continued strong cost control, visible versus 2019. Comparison vs 2020 affected by Covid-19 related cost containment plan Total Costs (€M) Key Highlights Personnel Costs +1.6% ▪ Total costs at 241.3 €M in 1H21, +1.6% vs 1H19, Operating Costs vs 1H19 confirming strong focus on cost control +11.8% ▪ T
Slide 17: Continued investments to support quality, innovation and IT transformation
Continued investments to support quality, innovation and IT transformation Capital Expenditure (€M) Ongoing investments (1H 2021): key examples Transformation Capex Transformation Capex 21 Ordinary capex Extraordinary Innovation: ✓ Open Banking Gateway & Corporate Banking % of 1H20 net revenues % of
Slide 18: IT strategy progress at 73%
IT strategy progress at 73%. ~40 €M of savings from M&A synergies reducing the remaining transformation capex to ~42 €M Capital Expenditure (€M) Transformation Capex progress 53% 65% 73% Transformation Capex for Extraordinary Innovation and Next Generation Platform deployment 1H21 ▪ ~73% program spe
Slide 19: Transformation Costs down by 58% in 1H21 compared to 1H19
Transformation Costs down by 58% in 1H21 compared to 1H19 Transformation Costs (€M) Bridge from 1H 2021 Transformation Costs to Managerial Non recurring items (€M) -11.1 26.4 13.3 -58% 30.2 +8% 10.3 11.1 25.2 -80.0 15.3 1H19 1H20 1H21 -95.3 1H21 SIA and Nets SIA and Nets LTI, Bond 1H21 IPO costs 1H2
Slide 20: Normalized Net Profit at 102.9 €M, up by 23% Y/Y
Normalized Net Profit at 102.9 €M, up by 23% Y/Y €M 298.2 87.7 o/w 15.3 €M sustained Y/Y performance by Financial Sponsors1 77.7 +23% +3% vs 1H19 71.8 95.3 102.9 95.3 16.6 48.9 14.0 11.4 1H21 EBITDA D&A Interest Non recurring Cash Taxes Reported D&A Δ Interest Non-recurring Δ Taxes Normalized Expens
Slide 21: Cash Flow conversion at 83%
Cash Flow conversion at 83% €M Cash Flow Conversion 1 83% vs 77% in 1H20 298.2 Y/Y performance 44.8 +23% 5.1 31.2 66.7 248.3 150.4 1H21 EBITDA Ordinary Capex Normalized Normalized Normalized Cash Normalized Normalized Change in WC Operating Cash Flow Interest Expenses 2 Cash Taxes3 Free Cash Flow No
Slide 22: Net Financial Debt / EBITDA down to 3.0x
Net Financial Debt / EBITDA down to 3.0x Net Financial Debt (€M) Key Highlights ▪ Nets’ existing indebtedness successfully June 20 Dec 20 Mar 21 June 21 refunded for ca. 2€B. Nexi Group’s outstanding financial debt fully unsecured Gross Financial Debt 2,741 2,781 3,648 5,721 ▪ Maturity of the IPO Fa
Slide 23: M&A update
M&A update 23
Slide 24: Continued progress in creating the European PayTech leader
Continued progress in creating the European PayTech leader Nets SIA 1H21 and 2Q21 ▪ Underlying Revenues1 at 500 €M in 1H21, +5.7% ▪ Revenues at 382 €M in 1H21, +13.6% y/y, and 199 y/y, and 267 €M in 2Q21, +14.3% y/y €M in 2Q21, +18.2% y/y Standalone ▪ Underlying EBITDA1 at 148 €M in 1H21, +5.0% y/y,
Slide 25: Transformation plan fully on track to deliver expected synergies
Transformation plan fully on track to deliver expected synergies Focus 2021 Focus 2022 Longer-term Goal Key updates One focused transformation program led by a highly experienced leadership team across workstreams Nets standalone growth plan ▪ Workstreams moving from planning to execution phase, i.e
Slide 26: Nexi Group Governance framework
Nexi + Nets only Nexi Group Governance framework Simplified, not exhaustive Transformation and Strategy Focus Group CEO Paolo Bertoluzzo Nexi Group Group Finance Group Transformation Group Technology Bernardo Mingrone Roberto Catanzaro Giuseppe Dallona … CEO CEO Italy Paolo Bertoluzzo Klaus Pedersen
Slide 27: Nets standalone performance 1H 2021 Results
Nets standalone performance 1H 2021 Results 27
Slide 28: Strong volume recovery visible across key geographies
Strong volume recovery visible across key geographies Total LAKA acquiring volumes2 Total SME acquiring volumes1 Total Issuing volumes3 -23% in June vs 2019 +8% in June vs 2019 +5% in June vs 2019 (-2% net of travel and hotels) Services (e.g. beauty) +30% Total High Impact Consumption Basic Consumpt
Slide 29: Nets standalone performance
Nets standalone performance Underlying Revenues (€M)1 Merchant Services & Solutions 68%2 Key Highlights Revenues, €M +5.7% +8.0% ▪ Revenue growth at +14.3% y/y in +18.0% 2Q21, sustained by continued strong E- 500 315 340 473 Commerce performance (+31% y/y) +14.3% 155 183 and volume recovery starting
Slide 30: Combined Nexi + Nets 1H 2021 Results
Combined Nexi + Nets 1H 2021 Results 30
Slide 31: Well diversified revenue base by business and geography
Well diversified revenue base both in terms of business and geography, with exposure to fast growing European markets. Strong operating leverage confirmed Revenues breakdown Costs breakdown by type By business By geography By type Merchant Services & Solutions Italy Nordics1 Installed based Variable
Slide 32: Strong revenue and EBITDA performance in 2Q and 1H
Strong revenue and EBITDA performance both in 2Q and 1H despite Covid-19 restrictions across geographies Net Revenues (€M) EBITDA (€M) Nets Nexi Nets Nexi EBITDA margin 43% 45% 42% 43% +9.3% +10.8% 1,039.5 446.1 950.7 402.8 148.0 500.0 +23.5% 140.9 +5% +18.4% 473.0 +6% 547.4 246.0 462.4 199.1 87.6 +
Slide 33: Positive revenue performance across geographies
Positive revenue performance across geographies with acceleration in 2Q 29%1 Nordics2 52%1 Italy +22.6% +7.9% 2Q21 vs 2Q20 2Q21 vs 2Q20 +12.9% +0.1% 477.6 539.5 304.0 304.3 1H20 1H21 1H20 1H21 17%1 DACH & Poland SE Europe & Other 2%1 +27.2% +13.0% 2Q21 vs 2Q20 2Q21 vs 2Q20 +17.0% +7.0% 173.3 20.9 22
Slide 34: Increased 2021 Ambition on a larger and more diversified base
Increased 2021 Ambition on a larger and more diversified base Combined Nexi+Nets 2021 Ambition Assuming continued recovery from Covid-19 with no new material restrictions across geographies: In 2H21 In FY21 Net Revenues +11% to +13% y/y ~+10% y/y In 2H21 In FY21 EBITDA +13% to +16% y/y +11% to +13%
Slide 35: Key messages
Key messages Continued Strong Continued progress acceleration in volumes, financial performance in creating the back to above pre-Covid levels in Q2 European PayTech leader ▪ All macro sectors now1 growing vs ▪ 2Q Revenues +22.6% vs 2Q20 ▪ Strong Nets and SIA standalone 2019, including Travel/Leisur
Slide 36: Q&A
Q&A 36
Slide 37: Annex
Annex 37
Slide 38: Nexi Standalone - P&L
Nexi Standalone - P&L Normalized P&L Reported P&L vs Normalized P&L Δ% vs. Normalized 1H20 1H21 Δ% vs. 1H20 2Q20 2Q21 1H21 Delta 2Q20 €M 1H21 €M Merchant Services & Solutions 242.9 271.8 +11.9% 114.6 143.4 +25.2% Merchant Services & Solutions 271.8 271.8 Cards & Digital Payments 180.1 206.2 +14.5% 8
Slide 39: Nets Standalone - P&L
Nets Standalone - P&L P&L – Organic figures Organic fugures Δ% vs. 1H20 1H21 Δ% vs. 1H20 2Q20 2Q21 €M 2Q20 Merchant Services & Solutions 315.0 340.0 +8.0% 155.3 183.3 +18.0% Cards & Digital Payments 116.1 106.6 -8.2% 56.1 56.8 +1.3% Digital Banking & Corporate Solutions 74.3 73.1 -1.7% 37.7 35.3 -6.
Slide 40: Nexi + Nets Combined P&L
Nexi + Nets Combined P&L Combined P&L – Nexi + Nets Organic figures Δ% vs. 1H20 1H21 Δ% vs. 1H20 2Q20 2Q21 €M 2Q20 Merchant Services & Solutions 557.8 611.8 +9.7% 269.9 326.7 +21.0% Cards & Digital Payments 296.2 312.8 +5.6% 143.6 163.8 +14.0% Digital Banking & Corporate Solutions 129.0 134.5 +4.3%
Slide 41: Acquiring sales volumes – Italian Cards vs Foreign Cards
Acquiring sales volumes – Italian Cards vs Foreign Cards Y/Y % Change Acquiring sales volumes – Italian Cards vs Foreign Cards – Y/Y trend Italian Cards Foreign Cards Total 300 239% 237% 208% 190%194% 200 170% 142% 102% 91% 92% 100 74% 88% 70% 89% 63% 41% 72% 68% 60% 50 7% 40% 34% 31% 26% 25% 20% 25
Slide 42: Acquiring sales volumes trend by consumption category
Acquiring sales volumes trend by consumption category Y/Y % Change Acquiring sales volumes trend by consumption category – Y/Y trend 400 Total High Impact Consumption Basic Consumption Discretionary Consumption 379% 350 328% 321% 273% 292% 174% 220% 144% 150 147% 118% 91% 91% 100 74% 59% 61% 51% 50
Slide 43: Acquiring sales volumes trend by consumption category
Acquiring sales volumes trend by consumption category Y/Y % Change Acquiring volumes by category1 Product category % change Y/Y FY20 1Q21 Apr May Jun 2Q21 LWR 2 44% for 41% for Basic consumption 16% 21% 20% 18% 15% 18% 15% +14% E-commerce E-commerce of which Physical 14% 21% 21% 19% 17% 19% 18% of w
Slide 44: SIA performance
SIA performance Revenues (€M) Cards & Merchant Solutions 68%1 Key Highlights Revenues, €M +16.7% +13.6% +25.3% ▪ Resilient and diversified business 260 model 382 223 336 109 136 +18.2% ▪ Acceleration in volumes during 2Q21, 199 back to pre-Covid growth levels, after 169 2Q20 2Q21 1H20 1H21 the progr
Slide 45: Investor Relations
Investor Relations investor.relations@nexi.it Stefania Mantegazza stefania.mantegazza@nexi.it 45