Slide 1: Q1 2022 Earnings Presentation
0 0 Q1 2022 EARNINGS PRESENTATION May 9, 2022
Slide 2: Disclaimers
1 1 Disclaimers Forward Looking Statements: This presentation contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of management. Although the Company believes that its plans, intentions, and
Slide 3: Key Highlights – Q1 2022
2 2 Key Highlights – Q1 2022 Adjusted EBITDA1 of $33M, 14% higher than Q1 ‘21 due to increased customer acquisitions by our clients and a focus on operational excellence and process improvement Strong momentum from Fintechs and traditional banks in the payment card business along with initial Arculu
Slide 4: Company Highlights
3 3 Company Highlights CompoSecure is driving strong partnership momentum across the payment card and Arculus ecosystems Traditional Banks • Key Sponsor & Panel Speaker at BTC 2022 Conference in Miami • BTC purchased 25K cobranded Arculus cold storage cards for attendees Payment Cards Digital Authen
Slide 5: Trends & Momentum
4 4 2.1 2.4 2.6 2.7 3.0 Q1 '21 Q2 '21 Q3 '21 Q4 '21 Q1 '22 2016 2019 2021 Trends & Momentum U.S. Consumer New Accounts Acquired, Millennial & Gen Z % of Total1 American Express Proprietary Cards Acquired1 In Millions • New cards acquired growth driven by all-time highs across US Consumer Platinum &
Slide 6: Metal Payment Card Survey – Across Countries
5 5 Metal Payment Card Survey – Across 18 Countries Metal Attraction Consumers attracted to metal cards due to durability, innovative design, exclusivity, and luxury Retention 51% would leave bank for another that offered metal card assuming benefits equal Loyalty 58% feel more positive about their
Slide 7: Product Portfolio
6 6 Product Portfolio 5.2 Cards Manufactured in 20203 8.0 Cards Manufactured in 20254 Variety of Key Capabilities to Meet Customer Demand Payment Card Payment Card + Digital Authentication1 Crypto Cold Storage Crypto Cold Storage + Digital Authentication1 Payment Card + Crypto Cold Storage + Digital
Slide 8: Arculus First Half 2022 Priorities
7 7 Arculus First Half 2022 Priorities Customer/Market Need Arculus Solution Non-Fungible Tokens (NFTs) Cryptocurrency/ Digital Asset Support Access to DeFi Ecosystem 1 2 3 WalletConnect Integration Leading Wallets (>100) Any Dapp (Hundreds) Chain Agnostic Wallet Integration w/Send, Receive, Store,
Slide 9: Arculus Secures NFTs: Anticipated Mid-June Launch
8 8 Arculus Secures NFTs: Anticipated Mid-June Launch Enables users to view their NFTs and securely send, receive, and securely store the keys to their NFTs
Slide 10: Arculus Integrates WalletConnect: Anticipated Mid-June Launch
9 9 Arculus Integrates WalletConnect: Anticipated Mid-June Launch Allows users to securely connect their wallets to DeFi platforms such as OpenSea and UniSwap
Slide 11: Arculus Secures DeFi: WalletConnect
10 10 Arculus Secures DeFi: WalletConnect • Integration of DeFi capabilities unlocks massive new target market for Arculus ecosystem • Secures keys for NFTs and other digital assets • Provides the ease of use of a browser extension with the security of a hardware wallet • Provides secure access to D
Slide 12: Multi-channel approach to drive brand awareness and adoption
11 11 CoinDesk BitCoin Magazine Google Shopping Yahoo Cluep Morning Brew Brave Arculus Investment 5.2 Cards Manufactured in 20203 Leveraging a multi-channel approach to drive B2C and B2B brand awareness, adoption, and engagement BitBoy Crypto Apple Insider Popzara Dealerscope G for Gadget Money2020:
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Slide 14: Q1 2022 Results
13 13 Q1 2022 Results Net Sales Gross Margin Adjusted EBITDA1 Adjusted EBITDA Margin1 Q1 ‘22 Q1 ‘21 % Change Commentary $84mm 58% $33mm 40% $64mm 54% $29mm 46% 32% 407bps 14% (636 bps) Strong sales with traditional banks & fintechs across domestic & international regions Process efficiencies benefit
Slide 15: Net Sales Trend
14 14 Net Sales Trend In millions $56 $46 $52 $64 $62 $8 $16 $14 $11 $22 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 International Domestic $64 $63 $66 $75 $84 International Domestic 12% 88% 26% 74% 21% 79% 15% 85% 26% 74%
Slide 16: Balance Sheets (Unaudited)
15 15 Balance Sheets (Unaudited) Source: Company financials Note: Audits completed to PCAOB standards. Financial position has been derived from CompoSecure’s consolidated financial statements for the quarters ended March 31, 2022 and December 31, 2021 respectively.
Slide 17: Earnings per Share
16 16 Earnings per Share Q1 ‘22 Net Income = Earnings per Share - Basic $27mm $0.32 x Controlling Interest 20% = Net Income for Basic EPS $4.7mm ÷ Class A Outstanding Shares 14.9mm Source: Company financials
Slide 18: 2022 Guidance
17 17 2022 Guidance Net Sales Adjusted EBITDA1 2022E 2021 % Change $268mm $102mm $336mm - $376mm $100mm - $110mm 25% - 40% (2%) - 7% 1 Adjusted EBITDA is a non-GAAP financial metric. For a reconciliation of Adjusted EBITDA to the most-comparable GAAP metric, please see the Appendix to this presentat
Slide 19: ESG Initiatives & Recognition
18 18 ESG Initiatives & Recognition CompoSecure continues to be recognized as an industry leader in sustainability, innovation, and leadership 1st Metal Card Manufacturer to receive new ICMA EcoLabel Standard Program Obtained Certification for UL’s Environmental Claim Validation Program Achieved ISO
Slide 20: Strategic Priorities
19 19 Strategic Priorities A Category Leader of Next-Gen Payment Technology, Security, and Cryptocurrency Solutions Drive premium payment card sales through continued domestic growth, international expansion, and FinTechs Deliver innovative new card constructs and leverage our scale and existing rel
Slide 21: Investor Relations Contact
20 20 Investor Relations Contact ir.composecure.com Marc Griffin (ICR) 646-277-1290 CompoSecure-IR@icrinc.com
Slide 22: @Compdecure
@Compdecure security § innovation durability
Slide 23: Summary Equity Capitalization Table
22 22 CompoSecure, Inc. (Nasdaq: CMPO) Summary Equity Capitalization Table (with net exercise model) As of March 31, 2022 Holders # of Shares Issued & Outstanding # of Shares Issued & Outstanding Public Shareholders (Class A) 4.6M 4.6M PIPE Investors (Class A) 4.5M 4.5M Roman Sponsor (Class A) 5.8M
Slide 24: Statements of Operations (Unaudited)
23 23 Statements of Operations (Unaudited) Source: Company financials Note: Financial position has been derived from CompoSecure’s consolidated financial statements for the quarters ended March 31, 2020, 2021 and 2022 respectively. ($mm) Q1 2022A Q1 2021A Q1 2020A Revenue Net Sales $84 $64 $80 Cost
Slide 25: Statements of Cash Flows (Unaudited)
24 24 Statements of Cash Flows (Unaudited) Source: Company financials Note: Financial position has been derived from CompoSecure’s consolidated financial statements for the quarters ended March 31, 2020, 2021 and 2022 respectively.
Slide 26: Non-GAAP Adjusted EBITDA Reconciliation (Unaudited)
25 25 Source: Company financials Non-GAAP Adjusted EBITDA Reconciliation (Unaudited) 1 Non-Cash Stock Option Expense: Non-cash stock option expenses related to the executive incentive plan 2 Nonrecurring Transaction Costs: Transaction related costs associated with prior transaction processes. 3 Non-