Slide 1: Third Quarter 2022 Earnings Conference Call
Third Quarter 2022 Earnings Conference Call November 2, 2022
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: Business Summary
Business Summary Mac Schuessler, President and CEO
Slide 4: Q3 2022 Financial Highlights
Q3 2022 Financial Highlights Revenue remained relatively flat at $145.8 Adjusted EBITDA $52.4 million, 25% decrease Financial Adjusted EPS $0.40, 35% decrease Results Adjusted EBITDA and Adjusted EPS impacted by $7.8 million non-cash foreign currency remeasurement loss Liquidity & Returned
Slide 5: Puerto Rico Update
Puerto Rico Update Evertec operations largely unaffected Hurricane Moderate impact to our Merchant Acquiring segment over last weeks of Fiona September update Commitment to help communities and employees impacted by the storm Payments Increased transaction volumes driving PR Digital channe
Slide 6: Latin America Update
Latin America Update Strong organic growth continues to drive our LATAM segment Growth Drivers Revenue contribution from BBR acquisition Expanded relationship with Mercado Libre into Chile Business wins New contract with Grupo Aval in Colombia for our Place to Pay gateway 6
Slide 7: Business Update
Business Update Popular Transaction Scholarship Program o No longer subject to the Bank Holding o Program in its 8th year with over $1 million awarded Company act o Awarded over $190,000 to 186 students o Allows us to be more agile with M&A o Impacting students in Puerto Rico and Latin America 7
Slide 8: Financial Summary
Financial Summary Joaquin Castrillo, Chief Financial Officer
Slide 9: Two Types of Foreign Currency Impacts
Two Types of Foreign Currency Impacts FX Translation FX Remeasurement FX rate fluctuations will impact Y/Y growth depending on Driven by USD balances sitting in our LATAM subsidiaries whether USD has strengthened or weakened against the (mainly Costa Rica and Chile) not in the functional local c
Slide 10: Consolidated Results Q3 2022
Consolidated Results Q3 2022 (#039;s in millions, except per share) Q3 2022 Y-O-Y % Revenue $145.8 - Adjusted EBITDA $52.4 -25% Adjusted EBITDA margin 35.9% -1,190bps Adjusted Net Income $27.1 -40% Adjusted EPS $0.40 -35% Q3 Revenue remained relatively flat, primarily impacted by the one-time credit
Slide 11: Merchant Acquiring Q3 2022
Merchant Acquiring Q3 2022 (#039;s in millions) Q3 2022 Y-O-Y % Revenue $36.9 -2% Adjusted EBITDA $13.9 -28% Adjusted EBITDA margin 37.6% -1,360 bps Q3 revenue decrease is primarily related to a tough comparable period that was positively impacted by COVID related stimulus as well as the impact from
Slide 12: Payment Services, PR and Caribbean Q3 2022
Payment Services, PR and Caribbean Q3 2022 (#039;s in millions) Q3 2022 Y-O-Y % Revenue $44.6 15% Adjusted EBITDA $25.0 15% Adjusted EBITDA margin 56.1% -13 bps Q3 revenue growth driven by an increase in transaction volumes for POS processing, ATH Movil Business, transaction processing and monitoring
Slide 13: Payment Services, Latin America Q3 2022
Payment Services, Latin America Q3 2022 (#039;s in millions) Q3 2022 Y-O-Y % Revenue $33.7 26% Adjusted EBITDA $3.2 -68% Adjusted EBITDA margin 9.5% -2,780 bps Q3 revenue driven by organic growth throughout the region and the contribution from the BBR acquisition completed at the beginning of the qua
Slide 14: Business Solution Q3 2022
Business Solution Q3 2022 (#039;s in millions) Q3 2022 Y-O-Y % Revenue $49.3 -15% Adjusted EBITDA $16.3 -37% Adjusted EBITDA margin 33.0% -1,180 bps Q3 revenue was directly impacted by the close of the transactions with Popular, primarily due to the $6.3 million one-time credit and the impact from th
Slide 15: Corporate and Other Q3 2022
Corporate and Other Q3 2022 (#039;s in millions) Q3 2022 Y-O-Y % Adjusted EBITDA -$6.0 18.0% % of Total Revenue 4.1% 90 bps Q3 Corporate and Other Adjusted EBITDA as a percentage of total revenues of 4.1% a slight improvement over prior year. *See Non-GAAP reconciliation summary in appendix, p.22-23.
Slide 16: Roll Forward of 2022 Cash Balance
Roll Forward of 2022 Cash Balance ($ in millions) Operating Activities $159 AFS Investments Beginning $(45) $(11) $1 Balance1 CAPEX Customer Relationship $(51) Ending $286 Acquisition $(16) FX Impact Balance2 BBR Acquisition Debt (Net) & $4 $244 Other 3 $(83) Repurchases & Dividends 12/31/2021 9/30/
Slide 17: Debt Summary
Debt Summary (#039;s in millions) 9/30/2022 9/30/2021 Unrestricted Cash $225.0 $244.1 Total Debt $457.8 $472.2 Term A Loan (2023 Maturity) L+200bps 163.4 174.4 Term B Loan (2024 Maturity) L+350bps 294.2 296.7 Revolver (2023 Maturity, $125M) L+200bps 0.0 0.0 Other 0.3 1.2 Net Debt $232.9 $228.1 Weight A
Slide 18: 2022 Outlook
2022 Outlook (#039;s in millions, except per share) Low High Total Revenue $607 $615 Growth % 3% 4% GAAP EPS - Diluted $3.22 $3.33 Adjusted EPS $2.36 $2.47 Growth % -14% -10% Capital Expenditures $60 Assumptions: Adjusted EBITDA Margin 44% 44% Tax rate 18% 17% Share Count used to compute Adjusted EPS 6
Slide 19: Q&A
Q&A 2 evertec
Slide 20: Non-GAAP Reconciliation Summary
Non-GAAP Reconciliation Summary The non-GAAP measures referenced in this release material 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 21: Reconciliation of GAAP to Non-GAAP Operating Results
Reconciliation of GAAP to Non-GAAP Operating Results Three months ended September 30, (Dollar amounts in thousands, except share data) 2022 2021 Net income $137,739 $35,260 Income tax expense 9,048 7,134 Interest expense, net 5,956 5,180 Depreciation and amortization 19,712 18,745 EBITDA 172,455 66,
Slide 22: Reconciliation of Q3 2022 Segment Non-GAAP Results
Reconciliation of Q3 2022 Segment Non-GAAP Results Three months ended September 30, 2022 Payment Services - Payment Puerto Rico & Services - Merchant Business Corporate and (In thousands) Caribbean Latin America Acquiring, net Solutions Other (1) Total Revenues $ 44,592 $ 33,741 $ 36,911 $ 49,306 $
Slide 23: Reconciliation of Q3 2021 Segment Non-GAAP Results
Reconciliation of Q3 2021 Segment Non-GAAP Results Three months ended September 30, 2021 Payment Services - Payment Puerto Rico & Services - Merchant Business Corporate and (In thousands) Caribbean Latin America Acquiring, net Solutions Other (1) Total Revenues $ 38,773 $ 26,792 $ 37,606 $ 58,134 $
Slide 24: Outlook Summary and Reconciliation to Non-GAAP Adjusted EPS
Outlook Summary and Reconciliation to Non-GAAP Adjusted Earnings per Share 2021 2022 Outlook Actual (Dollar amounts in millions, except share data) Low High Revenues $607 to $615 $590 Earnings per Share (EPS) (GAAP) $3.22 to $3.33 $2.21 Per share adjustment to reconcile GAAP EPS to Non-GAAP Adjusted
Slide 25: die!
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