Paysafe Limited · NYSE:PSFE
Paysafe — Q3 2022 Earnings Presentation
29 slides from Paysafe's earnings presentation, Nov 10, 2022
Slide 1: Third Quarter 2022 Earnings
Third Quarter 2022 Earnings NOVEMBER 10, 2022
Slide 2: Forward looking statements and non-GAAP financial measures
Forward looking statements and non-GAAP financial measures Forward-Looking Statements This presentation includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements are
Slide 3: Summary
Summary Q3 summary • Q3 performance above guidance Welcoming Alex Gersh as CFO • YoY growth from both US Acquiring and Digital Commerce (constant currency) • Brings +25 years of international • Continued to optimize organizational financial leadership and highly relevant structure industry experienc
Slide 4: Q3 progress across our long-term growth accelerators
Q3 progress across our long-term growth accelerators Reallocating and enabling Building our new global Wallet enhancements Launched 10 Paysafe Entry into new Kansas investment toward growth; sales organization (e.g., customization, crypto merchants in LatAm iGaming market finalizing 2023 priorities
Slide 5: Rebuilding our sales organization
Rebuilding our sales organization Key areas of sales transformation… New sales structure 1. Rebuild sales team and incentive model Digital Travel & Retail & Gaming Partners Assets Leisure Hospitality 2. Centralize pipeline and data 3. Sales enablement and deal ops Sales Enablement [content] 4. Deman
Slide 6: Aligning all businesses to focus on target verticals to drive the flywheel effect
Aligning all businesses to focus on target verticals to drive the flywheel effect Powering the world’s play through product-led innovation and powerful sales and GTM machine Streaming/ Travel & Retail/ iGaming Digital Assets Online Gaming Entertainment Hospitality EUROPE AMERICAS MARKET KEY Merchant
Slide 7: Wallet stabilizing, driving improvement
Wallet stabilizing, driving improvement • Revenue growth improves (constant FX) Digital Wallet revenue1 +2%Q3 +10% • Continued improvements to the wallet: Q3 YoY (CC) − Home screen customization − Enhanced visibility on payment limits Digital Wallet total deposits2 +9% Q3 YoY (CC) − Improved user jo
Slide 8: Q3 Financial Results
Q3 Financial Results
Slide 9: Q3 performance above guidance
Q3 performance above guidance $millions Q3 Guidance Actual Revenue $350 – $365 ✓ $366.0 Adj. EBITDA $90 – $95 ✓ $95.5 Adj. EBITDA margin % ~26% ✓ 26.1% 9
Slide 10: Q3 financial highlights
Q3 financial highlights Volume1 ($bn) Revenue ($m) Adj. EBITDA3($m) LTM FCF3 ($m) +5% +4% -10% -26% +10% cc2 -5% cc2 $31.1 $32.5 $350.1 $366.0 $106.4 $353.6 $95.5 $259.4 1.1% 1.1% 30.1% 26.1% 81% 64% take rate take rate margin margin conversion conversion (adj. EBITDA) (adj. EBITDA) Q3 2021 Q3 2022
Slide 11: Q3 summary of consolidated results
Q3 summary of consolidated results $ in millions Q3 '21 Q3 '22 Change 4% Revenue $353.6 $366.0 10% cc • Interest expense reflects higher amortization of issuance costs, Gross Profit (excluding D&A) $208.7 $214.2 3% increased rates, and higher Margin % 59.0% 58.5% (50bps) borrowings versus prior year
Slide 12: US Acquiring
US Acquiring Volume ($bn) Revenue ($m) Adj. EBITDA ($m) Volume ($bn) Revenue ($m) Adj. EBITDA ($m) • Volume reflects stable merchant portfolio; higher average ticket +5% +12% +24% • Slight moderation from prior $21.8 $185.4 $50.3 quarter as expected $20.7 $164.9 $40.7 • Overall strong growth and mar
Slide 13: Digital Commerce
Digital Commerce Volume1 ($bn) Revenue2 ($m) Adj. EBITDA2 ($m) • Performance inline with expectations with growth from -4% acquisitions and embedded +3% +8% cc finance offsetting FX headwind +10% cc, excl. war-region and war-impact $10.7 -21% $10.4 $188.6 $180.6 -7% cc • Expect sequential improvemen
Slide 14: Renamed and realigned business segments
Renamed and realigned business segments Changes to segments Current • Reporting segments renamed: Digital Commerce US Acquiring Digital Wallets - led by Chirag Patel (renamed from Digital Commerce) Merchant Solutions - led by Afshin Digital Wallet eCash IES/Enterprise US Acquiring Yazdian (renamed f
Slide 15: Leverage summary
Leverage summary Fixed rate vs. Interest Outstanding Facility Liquidity summary ($m) 9/30/22 floating rate rate ($m) Term Loan Facility (USD) Floating, 0.5% rate floor USD LIBOR + 2.75% $1,006 Cash and cash equivalents $220 Term Loan Facility (EUR) Floating, 0.0% rate floor EURIBOR + 3.00% 687 Undra
Slide 16: Q4 guidance
Q4 guidance $millions Q4'22 Guidance Revenue Bridge High single-digit Revenue $370 – $378 growth (CC) High single-digit ~100 bps Year-over-Year 0% to 1.5% $372 Mid- to high- $370 - $378 single digit ~650 bps Adj. EBITDA $105 – $109 Margin % ~28.5% Q4’21 Merchant Digital Wallets Q4’22e War 1 FX Q4’22
Slide 17: Reaffirming and tightening FY 2022 guidance
Reaffirming and tightening FY 2022 guidance $millions FY Guidance1 Revenue Bridge Mid single-digit Revenue $1,483 – $1,491 growth (CC) ~500 bps Low single-digit ~100 bps Year-over-Year ~Flat $1,487 $1,483 - $1,491 High single-digit Adj. EBITDA $407 – $411 Margin % ~27.5% 2021 Merchant Digital Wallet
Slide 18: Q&A Session
Q&A Session
Slide 19: Appendix
Appendix
Slide 20: Digital Commerce revenue disaggregation
Digital Commerce revenue disaggregation YoY % change % of total Active Users1 $m Q3 Revenue Segment Reported CC 12-month eCash $94 52% 4% 18% 16.4m Digital Wallet 75 42% -10% 2% 2.5m Integrated & eCommerce Solutions (IES) 18 10% -16% -14% Intrasegment (7) -4% Total Digital Commerce $181 100% -4% 8%
Slide 21: Supplemental: summary of segment results
Supplemental: summary of segment results 2021 2022 Q1 Q2 Q3 Q4 FY 2021 Q1 Q2 Q3 Volume ($m) US Acquiring $ 16,398 $ 20,507 $ 20,685 $ 20,439 $ 78,028 $ 19,849 $ 22,117 $ 21,788 Digital Commerce 11,114 11,786 10,374 11,050 44,325 11,320 11,245 10,708 Total $ 27,512 $ 32,292 $ 31,060 $ 31,489 $ 122,35
Slide 22: Supplemental: summary of segment results (new structure)
Supplemental: summary of segment results (new structure) 2020 2021 2022 Q1 Q2 Q3 Q4 FY 2020 Q1 Q2 Q3 Q4 FY 2021 Q1 Q2 Q3 Volume ($m) Merchant Solutions $ 18,477 $ 17,094 $ 20,205 $ 20,061 $ 75,837 $ 21,565 $ 26,356 $ 25,953 $ 26,128 $ 100,001 $ 25,862 $ 28,393 $ 27,827 Digital Wallets 7,130 5,630 5,
Slide 23: Statement regarding Non-GAAP financial measures
Statement regarding Non-GAAP financial measures To supplement the Company’s condensed consolidated financial statements presented in accordance with generally accepted accounting principles, or GAAP, the company uses non-GAAP measures of certain components of financial performance. This includes Gro
Slide 24: GAAP Net (loss) income to adjusted EBITDA reconciliation
GAAP Net (loss) income to adjusted EBITDA reconciliation Three months ended Nine months ended September 30, September 30, ($ in thousands) 2022 2021 2022 2021 (1) Net income / (loss) $ 978 $ (147,106) $ (1,828,573) $ (200,850) Income tax (benefit) / expense (1) 7,283 (76,859) (52,749) (66,105) Inter
Slide 25: Reconciliation of GAAP net (loss) income to Adjusted net income
Reconciliation of GAAP net (loss) income to Adjusted net income Three months ended Nine months ended September 30, September 30, ($ in thousands) (unaudited) 2022 2021 2022 2021 Net (loss) / income attributable to the Company $ 978 $ (147,200) $ (1,828,944) $ (201,250) Other non operating income, ne
Slide 26: Operating Cash Flow to Free Cash Flow reconciliation (LTM)
Operating Cash Flow to Free Cash Flow reconciliation (LTM) LTM LTM ($ in thousands) Q3 2022 Q3 2021 Net cash flows provided by (used in) operating activities $ 1,505,087 $ 328,903 Capital expenditure (92,001) (81,748) Cash paid for interest 92,368 99,390 Payments relating to restructuring and other
Slide 27: Operating Cash Flow to Free Cash Flow reconciliation
Operating Cash Flow to Free Cash Flow reconciliation Three months ended Nine months ended September 30, September 30, ($ in thousands) 2022 2021 2022 2021 Net cash (outflows) / inflows from operating activities $ (6,228) $ 51,590 $ 1,373,219 $ 92,600 Capital Expenditure (24,962) (22,914) (69,693) (6
Slide 28: GAAP Gross Profit to Gross Profit (excl. D&A) reconciliation
GAAP Gross Profit to Gross Profit (excl. D&A) reconciliation Three months ended Nine months ended September 30, September 30, ($ in thousands) 2022 2021 2022 2021 Revenue $ 365,988 $ 353,585 $ 1,112,569 $ 1,115,352 Cost of services (excluding depreciation and amortization) 151,810 144,852 457,900 45
Slide 29: Third Quarter Earnings - Thank You
Third Quarter 2022 Earnings THANK YOU