Priority Technology Holdings, Inc. · NASDAQ:PRTH
Priority Technology — Q4 2022 Earnings Presentation
22 slides from Priority Technology's earnings presentation, Mar 23, 2023
Slide 1: Supplemental Slides: Q4 2022 Earnings Call
Priority Technology Holdings, Inc. (Nasdaq: PRTH) Supplemental Slides: Q4 2022 Earnings Call March 23, 2023
Slide 2: Disclaimer
DISCLAIMER Important Notice Regarding Forward-Looking Statements and Non-GAAP Measures This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about future financia
Slide 3: Key 2022 Highlights
Key 2022 Highlights FY 2022 PERFORMANCE METRICS INDUSTRY LEADING PERFORMANCE REVENUE ADJ GROSS PROFIT1 29% 46% ADJUSTED OPERATING EBITDA1 INCOME 46% 70% 436K+ Consumer 258K+ Active $112B+ in LTM Accounts Merchants Total Volume 1 Adjusted Gross Profit, Adjusted Gross Profit margin and Adjusted EBITDA
Slide 4: Fourth Quarter 2022 Consolidated Results
Fourth Quarter 2022 Consolidated Results 23% 25% 50BP 21% $177.6M $61.0M 34.3% $39.8M $144.0M $48.7M 33.8% $32.9 Q4 21 Q4 22 Q4 21 Q4 22 Q4 21 Q4 22 Q4 21 Q4 22 Revenue grew Adj Gross Profit1 Adj Gross Profit Adjusted EBITDA1 23% to $177.6 increased 25% margin1 increased of $39.8 million million to
Slide 5: Full Year 2022 Consolidated Results
Full Year 2022 Consolidated Results 29% 46% 410BP 46% $663.6M $226.9M 34.2% $140.3M $514.9M $155.0M 30.1% $96.3M FY 21 FY 22 FY 21 FY 22 FY 21 FY 22 FY 21 FY 22 Revenue grew Adj Gross Profit1 Adj Gross Profit Adjusted EBITDA1 29% to $663.6 increased 46% margin1 increased of $140.3 million to $226.9
Slide 6: Priority Overview
Priority Overview PRIORITY AT A GLANCE CONTINUED STRONG MOMENTUM ■ Priority Technology Holdings, Inc. (NASDAQ:PRTH), is a payments technology company that leverages a purpose-built platform to REVENUE ADJUSTED EBITDA1 In Millions enable clients to collect, store and send money. In Millions $740 - $7
Slide 7: Priority Unified Commerce Platform
Priority Unified Commerce Platform SMB ACQUIRING PRIORITY B2B ENTERPRISE C U R AT E D A P P S MX Merchant MX POS CPX CFTPay MX Retail LandlordStation MX Connect CPX API CFTConnect MX Restaurant e|tab MX QSR PayRight Passport API MX Build MX Givv Passport Account U/I BANKING Passport Commerce APIs (P
Slide 8: Priority is Simplifying the Customer Experience
Priority is Simplifying the Customer Experience Working with Priority is as Easy as 1, 2, 3 1 Choose the Curated App(s) that best fit your needs 2 Chose the Passport Account Structure that best fits your uses 3 Start Moving Money 8
Slide 9: Financial Results
(SD PRIORITY AT Financial Results
Slide 10: Fourth Quarter 2022 – SMB (Revenue)
Fourth Quarter 2022 – SMB (Revenue) Key Revenue Drivers 23% SMB revenue of $149.9 million increased 23% from $121.5 million in Q4 2021 $149.9M $121.5M Bankcard $ Volumes of $14.9 billion increased over 7% Ending Merchant Count of 259K increased by 7% Q4 21 Q4 22 New Merchant Boards averaged ~4
Slide 11: Fourth Quarter 2022 – SMB (Profits)
Fourth Quarter 2022 – SMB (Profits) 18% 120BP 42% $36.0M $30.6M 25.2% $14.9M 24.0% $10.5M Q4 21 Q4 22 Q4 21 Q4 22 Q4 21 Q4 22 Adj Gross Profit1 Adj Gross Profit Operating increased 18% margin1 Income of $14.9 to $36.0 decreased 120 million million basis points to increased 42% 24.0% 11 1Adjusted Gro
Slide 12: Fourth Quarter 2022 – B2B (Revenue)
Fourth Quarter 2022 – B2B (Revenue) 48% Key Revenue Drivers B2B revenue of $2.8 million decreased 48% from $5.4 million $5.4M $2.8M Largely driven by Managed Services decrease from $2.7 million to $0.3 million due to final wind down of a specific customer Q4 21 Q4 22 program CPX decreased slight
Slide 13: Fourth Quarter 2022 – B2B (Profits)
Fourth Quarter 2022 – B2B (Profits) 35% 1260 283% BP $0.6M 60.7% $2.6M ($1.1M) $1.7M 48.1% Q4 21 Q4 22 Q4 21 Q4 22 Q4 21 Q4 22 Adj Gross Profit1 Adj Gross Profit Operating Loss decreased 35% margin1 increased of $1.1 million to $1.7 million from 48.1% to decreased from 60.7% Operating income of $0.6
Slide 14: Fourth Quarter 2022 – Enterprise (Revenue)
Fourth Quarter 2022 – Enterprise (Revenue) Key Revenue Drivers 46% ENTERPRISE revenue of $24.9 million increased 46% from $17.1 million $24.9M $17.1M Avg Monthly New Enrollments of 39K increased 127% from 17K Q4 21 Q4 22 Avg Number of Billed Clients increased 24% to 425K from 341K Increase in
Slide 15: Fourth Quarter 2022 – Enterprise (Profits)
Fourth Quarter 2022 – Enterprise (Profits) 50% 300BP 121% $23.3M $15.5M $11.5M 93.6% 90.6% $5.2M Q4 21 Q4 22 Q4 21 Q4 22 Q4 21 Q4 22 Adj Gross Profit1 Adj Gross Profit Operating increased 50% margin1 increased Income of $11.5 to $23.3 300 basis million million points to 93.6% increased 121% 15 1Adju
Slide 16: Operating Expenses
Operating Expenses Operating Expenses of $42.8 million increased 20% 41% 27% 2% $7.9M $16.9M $6.2M $18.0M $12.0M $17.6M Q4 21 Q4 22 Q4 21 Q4 22 Q4 21 Q4 22 Salaries & Benefits SG&A increased 27% Depreciation & increased 41% to $16.9 to $7.9 million Amortization of $18.0 million million increased 2%
Slide 17: Adjusted EBITDA Walk
Adjusted EBITDA1 Walk Adjusted EBITDA experienced strong growth in Q4 and Full-Year 2022 Q4 2022 Adjusted EBITDA of $39.8 million increased 21.0% from $32.9 million in Q4 2021 Full-Year 2022 Adjusted EBITDA grew 46% to $140.3 million EBITDA Walk 2022 2021 2022 2021 Q4 Q4 FY FY Consolidated net i
Slide 18: Outstanding Debt
Outstanding Debt Total Debt of $623.2 million at end of 2022 decreased from $631.9 million in 2021 Decrease driven by net $2.5 million Revolver decrease and $6.2 million in Term Loan Repayments Net Debt of $604.7 million decreased $6.9 million compared to 2021 Revolver Capacity at the end of Q
Slide 19: Senior Redeemable Preferred Stock
Senior Redeemable Preferred Stock Preferred Stock of $235.6 million, Net of $21.1 million of Unaccreted Discounts and Issuance Costs 4th Quarter Fourth Quarter Dividends and Accretion as follows: (dollars in Millions) 2022 Dividend: Payment in Kind $ 4.31 1 Cash 5.34 9.65 Accretion 0.83 $ 10.48 1
Slide 20: 2023 Financial Guidance
2023 Financial Guidance The Company’s outlook for full-year 2023 financial results are: REVENUE ADJUSTED EBITDA1 12% to 14% Growth 14% to 18% Growth $740 to $755 million $160 to $165 million Revenue and Adjusted EBITDA are forecast to strengthen with each successive quarter of 2023, reflecting posit
Slide 21: Appendix
(SD PRIORITY APPENDIX
Slide 22: Adjusted Gross Profit Reconciliation
Adjusted Gross Profit Reconciliation The reconciliation of adjusted gross profit to its most comparable GAAP measure is provided below: (in millions) (in millions) (in millions) (in millions) Twelve Months Ended December 31, 2022 Three Months Ended December 31, 2022 Twelve Months Ended December 31,
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