Waystar Holding Corp. · NASDAQ:WAY
Waystar — Q3 2024 Earnings Presentation
21 slides from Waystar's earnings presentation, Nov 6, 2024
Slide 1: Q3 2024 Financial Results
Q3 2024 Financial Results Earnings Presentation November 6, 2024 © 2024 Waystar. All rights reserved.
Slide 2: Forward-Looking Statements
FO R WAR D - LO O K ING STATE M E NTS This presentation contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that reflect our current views with respect to, among other things, statements regarding Waystar’s expectations relating to future
Slide 3: Introductions
INTRODUCTIONS Matt Hawkins Steve Oreskovich Sandy Draper Chief Executive Officer Chief Financial Officer VP of Investor Relations © 2024 Waystar. All rights reserved. 3
Slide 4: Strong Q3 performance: Key Highlights
22% Revenue growth1 19% Adjusted EBITDA growth2 KEY HIGHLIGHTS Strong Q3 40% $89M performance Adjusted EBITDA margin2 Unlevered free cash flow2 Growth rates and key metrics are at or above financial targets1 14% YoY Growth in clients 109% Net revenue with >$100k in TTM revenue3 retention3 (1) Growth
Slide 5: Revenue growth
Q 3 R E S U LT S Revenue growth Consistent and durable YoY revenue growth $ in millions $240.1 $234.5 $224.8 $206.7 $196.0 $197.3 $191.1 $182.1 13% $178.0 $120.7 $120.9 $117.1 Subscription growth CAGR $102.1 $94.4 $87.3 $94.0 $95.8 over last 8 quarters $84.4 20% $112.3 $118.0 Volume-based growth $99
Slide 6: Growth in clients with >$100K in ARR
Q 3 R E S U LT S Growth in clients with >$100K in ARR1 14% YoY growth and 5% QoQ increase 1,173 1,117 1,080 1,046 1,033 1,023 1,007 982 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 YoY 10% 9% 9% 7% 7% 7% 9% 14% 1Our count of clients who generate more than $100,000 of revenue is based on an accumulation o
Slide 7: Net Revenue Retention
Q 3 R E S U LT S Net Revenue Retention1 109% NRR in Q3; consistently delivering NRR between 108% and 110% 110% 110% 109% 109% 109% 109% 109% 108% 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 1Our Net Revenue Retention Rate compares twelve months of client invoices for our solutions at two period end date
Slide 8: Adjusted EBITDA
Q 3 R E S U LT S Adjusted EBITDA1 Delivered 40%+ Adjusted EBITDA margin over the past 8 quarters $ in millions 96.7 92.8 93.9 86.2 82.7 83.8 81.0 78.3 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 Margin 43% 43% 43% 41% 42% 41% 40% 40% 1 . Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial
Slide 9: Adjusted net leverage ratio
Q 3 R E S U LT S Adjusted net leverage ratio1 Paid down +$1 billion in debt year-to-date and repriced loan to reduce cost of capital and enhance ability to allocate free cash flow towards growth initiatives 7.5x 90 bp s 6.6x Reduced annual interest 36 0b ps expense by $100M+ • Over $1+ billion in de
Slide 10: Unlevered free cash flow
Q 3 R E S U LT S Unlevered free cash flow1 92% conversion of Adjusted EBITDA to uFCF for Q3'24, improving YTD conversion to 65% $ in millions $223 $300 $250 $230 $168 $185 FY’23 includes an incremental $200 $193 $101 $46M of cash taxes paid $144 vs. FY22 $150 $144 $100 $144 YTD’24 $50 $108 $103 incl
Slide 11: FY2024 Guidance
FY2024 Guidance % revenue growth and 40% Adjusted EBIDTA1 margin at midpoints FY'24 Guidance FY'23 Actual YoY% Change Low High Low High Revenue $926M $934M $791M 17% 18% Adjusted EBITDA 1 $374M $378M $334M 12% 13% Adjusted EBITDA % 40% 40% 42% Non-GAAP Net Income 2 $47M $50M ($39M) NM NM Non-GAAP EP
Slide 12: FY2024 Guidance assumptions
• Subscription growth of +10% YoY • Volume-based growth of +10% YoY • Seasonally lower patient payment volumes in 4Q’24 FY2024 • Continued investment in client support, innovation, and Guidance cybersecurity • ~$3M in public company costs in 2H’24 assumptions • • ~$55M is stock-based compensation ex
Slide 13: Q+A
Q+A WAYSTAR | SIMPLIFY HEALTHCARE PAYMENTS © 2024 Waystar. All rights reserved. 13
Slide 14: Appendix
Appendix WAYSTAR | SIMPLIFY HEALTHCARE PAYMENTS © 2024 Waystar. All rights reserved. 14
Slide 15: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES To supplement the consolidated financial statements prepared and presented in accordance with U.S. generally accepted accounting principles (“GAAP”), this presentation contains certain non-GAAP financial measures as defined below. We present non-GAAP financial measures as
Slide 16: Key Performance Metrics
KEY PERFORMANCE METRICS Net Revenue Retention Rate Our Net Revenue Retention Rate compares twelve months of client invoices for our solutions at two period end dates. To calculate our Net Revenue Retention Rate, we first accumulate the total amount invoiced during the twelve months ending with the p
Slide 17: GAAP Quarterly Income Statement
GAAP Quarterly Income Statement Unaudited, $ in thousands Consolidated Statements of Operations 1Q 23 2Q 23 3Q 23 4Q 23 FY 23 1Q 24 2Q 24 3Q 24 Revenue 191,083 195,969 197,263 206,695 791,010 224,792 234,543 240,112 Cost of revenue (exclusive of depreciation and amortization expenses) 59,155 60,500
Slide 18: Non-GAAP Quarterly Income Statement
Non-GAAP Quarterly Income Statement Unaudited, $ in thousands Non-GAAP Consolidated Statements of Operations 1Q 23 2Q 23 3Q 23 4Q 23 FY 23 1Q 24 2Q 24 3Q 24 Revenue 191,083 195,969 197,263 206,695 791,010 224,792 234,543 240,112 Cost of revenue (exclusive of depreciation and amortization expenses),
Slide 19: Non-GAAP Reconciliations and Key Metrics
Non-GAAP Reconciliations and Key Metrics Unaudited, $ in thousands, except per share amounts Reconciliation of Non-GAAP Adjusted EBITDA 1Q 23 2Q 23 3Q 23 4Q 23 FY 23 1Q 24 2Q 24 3Q 24 Net income/(loss) (10,623) (10,810) (15,486) (14,415) (51,334) (15,932) (27,685) 5,413 Interest expense 49,501 51,14
Slide 20: Net Debt and Leverage
Net Debt and Leverage Unaudited, $ in thousands Reconciliation of Net Debt 3Q 24 First lien term loan facility outstanding debt, current 12,909 First lien term loan facility outstanding debt, net of current portion 1,153,864 Second lien term loan facility outstanding debt - Receivables facility oust
Slide 21: Thank you
Thank you © 2024 Waystar Holding Corp. All rights reserved. Waystar®, the Waystar Star Logo, and all other trademarks, trade names, service marks, and logos referenced herein, unless otherwise noted, belong to Waystar Holding Corp. or its affiliates. © 2024 Waystar