Slide 1: First Quarter 2019 Earnings Conference Call
First Quarter 2019 Earnings Conference Call May 1, 2019 1
Slide 2: Disclosures
Disclosures 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, uncer
Slide 3: Business Summary
Business Summary Mac Schuessler President and CEO 3
Slide 4: Q1 2019 Financial Highlights
Q1 2019 Financial Highlights Total Revenue $119 million - increased 8% Strong Results Adjusted EBITDA $58 million - increased 7% Adjusted EPS $0.50 - increased 6% Delivered YTD operating cash flow of $29 million Returning Cash to Returned $21 million to shareholder Shareholders •~$17 milli
Slide 5: Puerto Rico Update
Puerto Rico Update Continued Revenue Growth ⦁ Revenue up 11%, driven by volume and transaction growth ⦁ Positive impact from one-time revenue of $2.7M related to EBT program ⦁ Continued strong execution supporting our merchants and partners Fiscal Plan Update and PR Government Tax Figures ⦁ Revised
Slide 6: Latin America Update
Latin America Update Revenue Up ~2%, as Anticipated ⦁ Revenue growth impacted by anticipated attrition and non-recurring license sales in the previous comparable period ⦁ Further delay in client migration - attrition impact now expected closer to $3 million 6
Slide 7: Financial Summary
Financial Summary Joaquin Castrillo Chief Financial Officer 7
Slide 8: Consolidated Results Q1 2019
Consolidated Results Q1 2019 (#039;s in millions, except per share) Q1 2019 Y-O-Y % Revenue $ 118.8 8% Adjusted EBITDA $ 57.6 7% Adjusted EBITDA margin 48.5% -40 bps Adjusted Net Income $ 37.1 7% Adjusted EPS $ 0.50 6% • Q1 revenue growth reflects growth in sales volumes and transactions, EBT one-time
Slide 9: Merchant Acquiring
Merchant Acquiring (#039;s in millions) Q1 2019 Y-O-Y % Revenue $ 26.0 11% Adjusted EBITDA $ 12.0 10% Adjusted EBITDA margin 46.1% -40 bps • Q1 revenue reflects sales volume growth ◦ Strong volume growth in January and February, lapping hurricane impacted results; relatively flat sales volume growth in
Slide 10: Payment Services, PR and Caribbean
Payment Services, PR and Caribbean (#039;s in millions) Q1 2019 Y-O-Y % Revenue $ 32.0 18% Adjusted EBITDA $ 21.3 23% Adjusted EBITDA margin 66.4% 270 bps • Q1 revenue reflects strong transaction volumes growth of ~10%, as well as one-time EBT program revenue of $2.7M ◦ Positive impact of ATH Movil & A
Slide 11: Payment Services, Latin America
Payment Services, Latin America (#039;s in millions) Q1 2019 Y-O-Y % Revenue $ 20.8 2% Adjusted EBITDA $ 8.3 18% Adjusted EBITDA margin 39.6% 530 bps • Q1 revenue growth reflects increased intercompany revenue, partially offset by forecasted client attrition and uneven timing of license and service rev
Slide 12: Business Solutions
Business Solutions (#039;s in millions) Q1 2019 Y-O-Y % Revenue $ 51.4 7% Adjusted EBITDA $ 23.0 -1% Adjusted EBITDA margin 44.9% -350 bps • Q1 revenue growth favorably impacted by higher core banking transactional volumes, as well as new managed services offered to Popular and the Government of Puerto
Slide 13: Corporate and Other
Corporate and Other (#039;s in millions) Q1 2019 Y-O-Y % Adjusted EBITDA $ (6.9) 59% % of Total Revenue (5.8)% (190) bps • Q1 corporate expenses increase reflect lower spending last year and higher project and intercompany expenses in the current quarter ⦁ Adjusting for $2.1M intercompany elimination,
Slide 14: Roll Forward of 2019 Cash Balance
Roll Forward of 2019 Cash Balance ($’s in Millions) Operating Activities Debt (Repayment) / Issuance, Net(3) Beginning Ending Balance(1) Balance(2) Capex Dividends and Share Repurchases 12/31/2018 3/31/2019 (1) Includes $17 million in restricted cash. (2) Includes $13 million in restricted cash. (3)
Slide 15: Debt
Debt (#039;s in millions) 03/31/19 12/31/18 Unrestricted Cash $ 73.2 $ 69.9 Total Debt $ 556.7 $ 545.3 Term A Loan (2023 Maturity) L+200bps $ 217.3 $ 220.0 Term B Loan (2024 Maturity) L+350bps $ 324.2 $ 325.0 Revolver (2023 Maturity, $125M) L+200bps $ 15.0 $ — Other $ 0.3 $ 0.3 Net Debt $ 483.5 $ 475.4
Slide 16: 2019 Outlook
2019 Outlook (#039;s in millions, except per share) Low High Total Revenue $ 469 $ 476 Growth % 3% 5% GAAP EPS - Diluted $ 1.3 $ 1.38 Adjusted EPS $ 1.84 $ 1.92 Growth % 0% 4% Capital Expenditures $ 40 $ 45 Assumptions: Adjusted EBITDA Margin 47% 47% M&A related depreciation and amortization ~ $ 0.42 N
Slide 17: Q&A
~ evertec Q&A
Slide 18: Non-GAAP Financial Information
Non-GAAP Financial Information 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 me
Slide 19: Reconciliation of GAAP to Non-GAAP Operating Results
Reconciliation of GAAP to Non-GAAP Operating Results Three months ended March 31, (Dollar amounts in thousands, except share data) 2019 2018 Net income $ 26,734 $ 23,114 Income tax expense 3,809 3,935 Interest expense, net 7,292 7,522 Depreciation and amortization 16,273 15,867 EBITDA 54,108 50,438
Slide 20: Reconciliation of Q1 2019 Segment Non-GAAP Results
Reconciliation of Q1 2019 Segment Non-GAAP Results Three months ended March 31, 2019 Payment Services - Payment Puerto Rico & Services - Merchant Business Corporate and (In thousands) Caribbean Latin America Acquiring, net Solutions Other (1) Total Revenues $ 32,017 $ 20,831 $ 25,974 $ 51,364 $ (11,
Slide 21: Reconciliation of Q1 2018 Segment Non-GAAP Results
Reconciliation of Q1 2018 Segment Non-GAAP Results Three months ended March 31, 2018 Payment Services - Payment Puerto Rico & Services - Merchant Business Corporate and (In thousands) Caribbean Latin America Acquiring, net Solutions Other (1) Total Revenues $ 27,168 $ 20,391 $ 23,379 $ 47,921 $ (8,5
Slide 22: Outlook Summary and Reconciliation to Non-GAAP Adjusted Earnings per Share
Outlook Summary and Reconciliation to Non-GAAP Adjusted Earnings per Share 2019 Outlook 2018 Actual (Dollar amounts in millions, except per share data) Revenues $ 469 to $ 476 $ 454 Earnings per Share (EPS) - Diluted (GAAP) $ 1.30 to $ 1.38 $ 1.16 Per share adjustment to reconcile GAAP EPS to Non-GA