Paysafe Limited · NYSE:PSFE
Paysafe — Q4 2021 Earnings Presentation
29 slides from Paysafe's earnings presentation, Mar 2, 2022
Slide 1: Fourth Quarter and Full Year 2021 Earnings Presentation
Fourth Quarter and Full Year 2021 Earnings Presentation March 2, 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: Key messages
Key messages Winning across Digital 4Q results ahead of Delivering on Commerce, strong U.S. revised guidance Digital Wallet turnaround Acquiring growth, Rev +3%, Adj. EBITDA +11% vs. guide(1) executing on cost savings Q4 +20% YoY flat YoY +11% YoY volume growth revenue growth Adj. EBITDA(3) growth F
Slide 4: Actions to Reposition For Long-Term Success
Delivering on Digital Wallet turnaround; continued Eur market softness What we said… …early progress • Improvements to customer experience and pricing changes ✓ Pricing optimization + improved UX driving increasing deposits in targeted Short-Term For Long-Term Success Actions to Reposition European
Slide 5: Paysafe Digital Commerce – leading specialized payments platform
Paysafe Digital Commerce – leading specialized payments platform Easy Connectivity More Ways Deep Risk / Client via Single API to Pay Reg Capabilities Focus Card iGaming Global risk & regulatory Wallets management Crypto team Payment Digital eCash Local Optimization goods APMs Real-time Local Travel
Slide 6: Paysafe Digital Commerce – single API and white label wallet solution
Paysafe Digital Commerce – single API and white label wallet solution combined to enable frictionless payments for major crypto exchange Paysafe differentiation Easy Connectivity More Ways Deep Risk / Client via Single API to Pay Reg Capabilities Focus • White label wallet, pay in pay Card iGaming o
Slide 7: Paysafe Digital Commerce – winning in North America iGaming
Paysafe Digital Commerce – winning in North America iGaming The go-to iGaming partner for online payment solutions (Q4 and recent highlights) • New York launch with DraftKings, Caesars Entertainment, WynnBET, PointsBet • Additional launches with multiple brands in Oregon and Louisiana – Paysafe now
Slide 8: US Acquiring – strong SMB growth; direct marketing recovering
US Acquiring – strong SMB growth; direct marketing recovering US acquiring retail (SMB) Strong growth YoY and vs 2019 2021 vs 2020 Revenue 2021 vs 2019 Revenue Paysafe US Acquiring 20% 17% 15% 15% • Scaled merchant acquirer for SMB • Single platform for onboarding and servicing • Multi-processor opt
Slide 9: Delivering on cost savings, efficiencies and M&A integrations
Delivering on cost savings, efficiencies and M&A integrations Cost optimization M&A integrations • Exceeded cost saving plan: ~$40m 2021 (vs. $30m original target) • Closed SafetyPay Jan 31, 2022 • Targeting incremental $20m+ 2022 • Pago and viafintech integrations on track (volume up >50% Q4 YoY) −
Slide 10: Segment realignment – Digital Commerce and US Acquiring
Segment realignment – Digital Commerce and US Acquiring • Digital Commerce merchants plug into Paysafe to access Digital Commerce US Acquiring end-to-end solutions; single go-to-market approach 100% Online ~35% Online (volume) across key verticals eCash Digital Integrated Retail/SMB Direct • Support
Slide 11: Q4 performance exceeded revised guidance
Q4 performance exceeded revised guidance Q4 2021 Guidance Actual $millions as revised Nov. 11 Revenue $355 – $365 ✓ $372 Gross Profit (excl. D&A) $205 – $215 ✓ $224 Adj. EBITDA $90 – $100 ✓ $105 Cost of Services (excl. D&A) + SG&A (excl. SBC) ~$265 ✓ $266 11
Slide 12: Q4 financial highlights
Q4 financial highlights Volume ($bn) Revenue ($m) +20% 0% $31.5 $26.2 $370.3 $371.7 • Volume. Strong growth from Integrated Processing offset declines from Digital Wallet − Market/regulatory headwinds in Europe impacting eCash and Digital Wallet − eCash lapping strong Q4'20, which benefited from COV
Slide 13: 2021 full year financial highlights
2021 full year financial highlights Volume ($bn) Revenue ($m) +22% +4% $122.4 $1,487 $1,426 +6% Ex. PL • Volume. Strong growth from Integrated Processing and $100.7 eCash offset decline from Digital Wallet • Revenue. Growth driven by eCash and Integrated Processing; lower take rate reflects overall
Slide 14: Q4 summary of consolidated results
Q4 summary of consolidated results $ in millions, except volume Q4'20(1) Q4'21 Change Q4 commentary Volume $26.2bn $31.5bn 20% • Net income benefited from fair value gain of $64m resulting from the remeasurement of the warrant liability Revenue $370.3 $371.7 0% at quarter-end Gross Profit (excluding
Slide 15: eCash
eCash Volume ($bn) Revenue ($m) Adj. EBITDA ($m) +26% +42% +22% $5.8 $4.6 $406.2 $165.1 $332.9 -6% +8% +9% $116.0 $105.9 $99.2 $35.0 $37.6 $1.5 $1.6 Q4 2020 Q4 2021 2020FY 2021FY Q4 2020 Q4 2021 2020FY 2021FY Q4 2020 Q4 2021 2020FY 2021FY 7.3% 6.2% 7.2% 7.0% 33.1% 37.9% 34.8% 40.6% take rate take ra
Slide 16: Digital Wallet
Digital Wallet Volume ($bn) Revenue ($m) Adj. EBITDA ($m) -7% -8% -16% $178.8 $394.5 $167.0 $20.4 $363.8 $17.2 +16% -19% -9% $42.4 $4.8 $3.9 $96.4 $87.9 $36.6 Q4 2020 Q4 2021 2020FY 2021FY Q4 2020 Q4 2021 2020FY 2021FY Q4 2020 Q4 2021 2020FY 2021FY 2.0% 2.2% 1.9% 2.1% 38.0% 48.2% 45.3% 45.9% take ra
Slide 17: Integrated Processing
Integrated Processing Pay Later Volume ($bn) Revenue ($m) Adj. EBITDA ($m) +4% +7% +32% Ex. PL $745.3 -8% -6% $100.0 $720.0 Ex. PL +9% $203.7 $75.8 $696.0 $186.9 $174.8 $190.3 +8% $199.7 +30% $51.8 $26.1 $47.8 $20.1 Q4 2020 Q4 2021 2020FY 2021FY Q4 2020 Q4 2021 2020FY 2021FY Q4 2020 Q4 2021 2020FY 2
Slide 18: Sustained take rates across segments; mix shift to Processing
Sustained take rates across segments; mix shift to Processing Before impact of acquisitions 7.2% 7.2% 7.2% 7.3% 7.3% 7.3% 7.3% 7.3% 7.1% 7.1% 2.0% 2.0% 2.0% 2.1% 2.1% 2.1% 2.2% 1.8% 1.6% 1.6% 1.0% 1.0% 1.0% 1.0% 0.9% 0.9% 0.8% 0.7% 0.7% 0.7% '18FY '19FY 'Q1'20 'Q2'20 'Q3'20 'Q4'20 'Q1'21 'Q2'21 'Q3'
Slide 19: Leverage summary
Leverage summary Liquidity summary ($m) 12/31/21 • Net leverage 5.5x pro forma (12/31/21) with closing Cash and cash equivalents(1) $702 of SafetyPay acquisition (1/31/22) Undrawn amounts under revolving credit facility(2) $277 • Maintaining significant covenant headroom • Continued commitment to lo
Slide 20: 2022 FY and Q1'22 guidance
2022 FY and Q1'22 guidance FY 2022 expectations 2022 FY Q1 2022 • US Acquiring: high single-digit to low double-digit growth Guidance Guidance • Digital Commerce: flat to low single-digit growth $millions ↑ Inorganic contribution (Pago, SafetyPay, viafintech) ↑ Integrated & eCommerce (e.g., North Am
Slide 21: Summary
Summary Focused on delivering on our strategic priorities, underscored by end-to-end payment solutions and risk management, to partner with leading-edge companies in fast growing verticals Delivering on digital wallets Maintaining 2022 outlook Winning exciting deals across turnaround with positive a
Slide 22: Appendix
Paysafe: Appendix
Slide 23: Supplemental: summary of 2020-2021 segment results (new structure)
Supplemental: summary of 2020-2021 segment results (new structure) 2020 2021 Q1 Q2 Q3 Q4 FY 2020 Q1 Q2 Q3 Q4 FY 2021 Volume ($m) US Acquiring $ 14,381 $ 12,797 $ 15,541 $ 15,166 $ 57,884 $ 16,398 $ 20,507 $ 20,685 $ 20,439 $ 78,028 Digital Commerce 11,179 9,902 10,626 11,076 42,783 11,114 11,786 10,
Slide 24: Supplemental: summary of 2021 segment results (previous structure)
Supplemental: summary of 2021 segment results (previous structure) 2021 2021 Q1 Q2 Q3 Q4 FY 2021 Q1 Q2 Q3 Q4 FY 2021 Volume ($m) Revenue ($m) Integrated Processing $ 21,565 $ 26,356 $ 25,953 $ 26,128 $ 100,001 Integrated Processing $ 176.9 $ 191.2 $ 186.9 $ 190.3 $ 745.3 Digital Wallet 4,602 4,698 3
Slide 25: 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 26: GAAP Net income (loss) to Adjusted EBITDA reconciliation
GAAP Net income (loss) to Adjusted EBITDA reconciliation Three months ended Years ended December 31, December 31, ($ in thousands) 2021 2020 2021 2020 Net income / (loss) $ 90,522 $ (3,012) $ (110,328) $ (126,714) Income tax benefit (19,005) (21,126) (85,110) (59,199) Interest expense, net 21,536 41
Slide 27: GAAP to Non-GAAP reconciliation – growth excluding business disposal
GAAP to Non-GAAP reconciliation – growth excluding business disposal $ millions 2020 2021 % change Paysafe total revenue $ 1,426 $ 1,487 4% Adjustment for disposed business (Pay Later) 24 - Paysafe Total revenue excluding Pay Later $ 1,402 $ 1,487 6% Integrated Processing total revenue $ 720 $ 745 4
Slide 28: Operating Cash Flow to Free Cash Flow reconciliation
Operating Cash Flow to Free Cash Flow reconciliation Three months ended Years ended December 21, December 31, ($ in thousands) 2021 2020 2021 2020 Net cash inflows from operating activities $ 131,868 $ 236,303 $ 224,468 $ 409,109 Capital expenditure(1) (22,308) (20,213) (83,843) (65,872) Cash paid f
Slide 29: GAAP Gross Profit to Gross Profit (excl. D&A) reconciliation
GAAP Gross Profit to Gross Profit (excl. D&A) reconciliation Three months ended Years ended December 31, December 31, ($ in thousands) 2021 2020 2021 2020 Revenue $ 371,661 $ 370,285 $ 1,487,013 $ 1,426,489 Cost of services (excluding depreciation and amortization) 148,111 143,838 599,778 534,823 De