First Advantage Corporation · NASDAQ:FA
First Advantage — Q1 2023 Earnings Presentation
19 slides from First Advantage's earnings presentation, May 10, 2023
Slide 1: Q1 2023 Earnings Presentation
Q1 2023 EARNINGS PRESENTATION May 10, 2023
Slide 2: Forward-Looking Statements and Non-GAAP Financial Information
FORWARD-LOOKING STATEMENTS This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, our operations and financial performance. For
Slide 3: Company Overview & Q1 2023 Highlights
COMPANY OVERVIEW & Q1 2023 HIGHLIGHTS Scott Staples Chief Executive Officer
Slide 4: Company Snapshot & Highlights
COMPANY OUR CUSTOMERS 1 SNAPSHOT & HIGHLIGHTS 33K 100M+ 50%+ 97% 13 Year Customers Screens of Fortune 100 Gross Retention Average and ~33% Fortune 500 Rate Tenure LEADING GLOBAL PROVIDER OF EMPLOYMENT BACKGROUND SCREENING AND VERIFICATION SOLUTIONS OUR TECHNOLOGY OUR MARKET 1 935+ 3,000+ 700M+ 75+ C
Slide 5: Q1 2023 Key Business Highlights
Q1 2023 KEY BUSINESS HIGHLIGHTS Macro Environment • U.S. labor market continues to show some pockets of resilience, and while activity has moderated relative to the extremely strong levels from a year ago and the degree of uncertainty remains elevated, overall hiring remains generally stable • Meani
Slide 6: Dedicated to Our Sustainability Efforts
DEDICATED TO OUR SUSTAINABILITY EFFORTS Our commitments to advancing sustainability are through a lens of enhancing stakeholder value while continuing to be a responsible corporate citizen, an employer of choice, and a leader in the ethical treatment of a diverse employee base Key Focus Areas 2022 H
Slide 7: Financial Results & Outlook
FINANCIAL RESULTS & OUTLOOK David Gamsey EVP, Chief Financial Officer
Slide 8: Q1 2023 Financial Results
Q1 2023 FINANCIAL RESULTS ($ in millions, except per share data and percentages) REVENUES ADJUSTED EBITDA AND MARGIN 1 ADJUSTED DILUTED EARNINGS PER SHARE 1 40% $189.9 -7.6% $53.6 38% -9.4% $48.6 $0.22 $175.5 36% 34% -13.6% -6.4% 32% Constant 30% $0.19 Currency 28% Basis 1 28.2% -50 BPS 27.7% 26% 24
Slide 9: Balance Sheet Strength Provides Flexibility
BALANCE SHEET STRENGTH PROVIDES FLEXIBILITY CLEAR AND CONSISTENT CAPITAL SIGNIFICANT CASH FLOW GENERATION LOW NET LEVERAGE ALLOCATION PRIORITIES • YoY cash flow from operations decline driven • Net leverage 1 declined from 1.1x at 3/31/22 to Pursue Strategic M&A Opportunities primarily by lower Q1 r
Slide 10: Reaffirming Full Year 2023 Guidance
REAFFIRMING FULL YEAR 2023 GUIDANCE ($ in millions, except per share data) FY 2022 Actuals FY 2023 Guidance Y/Y % Growth Revenues $810 $770 to $810 -5% to 0% Constant Currency Revenues $774 to $814 -4% to +0.5% Adjusted EBITDA $249 $240 to $255 -4% to +2% Adjusted Net Income $156 $145 to $155 -7% to
Slide 11: Closing Remarks
CLOSING REMARKS Scott Staples Chief Executive Officer
Slide 12: Investment Highlights
INVESTMENT HIGHLIGHTS 1 A global leader in a large, fragmented, and growing market Diversified enterprise-focused customer base across attractive industry 2 verticals with focus on high volume hiring Digital technology, automation, and machine learning enabling 3 customers to hire smarter and onboar
Slide 13: Appendix
APPENDIX Supplemental Materials and Reconciliations to GAAP Measures
Slide 14: FY 2022 Revenue Breakdown by Vertical
FY 2022 REVENUE BREAKDOWN BY VERTICAL Technology Transportation Small Business 3% 22% 4% Manufacturing and Other Industrials 7% High Volume Business and 11% Hiring Retail and Professional Services Focused 20% E-Commerce Verticals 12% 4% 12% Financial 5% Services Healthcare Hospitality General Staffi
Slide 15: Proven Formula for Above-Market Long-Term Revenues Growth
PROVEN FORMULA FOR ABOVE-MARKET LONG-TERM REVENUES GROWTH Existing Customers New Customers • Significant whitespace • New product launches • Fragmented industry • Increased package • $13B Total Addressable Market density • Leading value proposition • New geographies • High retention • Track record o
Slide 16: Long-Term Organic Growth Targets
LONG-TERM ORGANIC GROWTH TARGETS 1 Long-Term Organic Targets Key Drivers • Proven growth formula • Existing customer base growth • Upsell / cross-sell to existing customers • New customer wins Revenues Growth 8 – 10% • Net of existing customer attrition • Performance track record • Identified market
Slide 17: Adjusted EBITDA
ADJUSTED EBITDA (a) Represents charges incurred related to acquisitions and similar transactions, primarily consisting of change in control-related costs, professional service fees, and other third-party costs. Additionally includes incremental professional service fees incurred related to the initi
Slide 18: Constant Currency Revenues and Adjusted EBITDA
CONSTANT CURRENCY REVENUES CONSTANT CURRENCY ADJUSTED EBITDA (a) Constant currency revenue is calculated by translating current period amounts using prior-year period exchange rates. (a) Constant currency Adjusted EBITDA is calculated by translating current period amounts using prior-year period exc
Slide 19: Adjusted Net Income and Adjusted Diluted Earnings Per Share
ADJUSTED NET INCOME ADJUSTED DILUTED EARNINGS PER SHARE (a) Represents non-cash interest expense related to the amortization of debt issuance costs for the Company’s First Lien Credit Facility. Beginning in 2022, this adjustment also includes the impact of the change in fair value of interest rate s