Repay Holdings Corporation · NASDAQ:RPAY
Repay — Q3 2019 Earnings Presentation
31 slides from Repay's earnings presentation, Nov 14, 2019
Slide 1: REPAY Investor Presentation November 2019
REPAY Investor Presentation November 2019 Exhibit 99.2
Slide 2: Disclaimer
Disclaimer On July 11, 2019 (the “Closing Date”), Thunder Bridge Acquisition, Ltd. (“Thunder Bridge”) and Hawk Parent Holdings LLC (“Hawk Parent”) completed their previously announced business combination under which Thunder Bridge acquired Hawk Parent, upon which Thunder Bridge changed its name to
Slide 3: Who We Are
Low Chargeback Rates(6) 0.20% Historical Processing and Service Fees CAGR(4) 27% Who We Are Source: Stax – REPAY Market Sizing Report, commissioned by REPAY; Stax prepared surveys, secondary research, and analysis. January 2018. Source: EY Parthenon – ERP Market Report, commissioned by REPAY; EY pre
Slide 4: REPAY's Business Strengths and Strategies
REPAY’s Business Strengths and Strategies A Leading, Omni-Channel Payment Technology Provider Capitalizing on the Large, Underserved Market Opportunities in Existing and New Verticals Card and Debit Payments Underpenetrated in Existing Verticals REPAY Has Built a Leading Platform Based on Vertical E
Slide 5: Growth Opportunities
Growth Opportunities $408 bn Automotive Loans $69 bn Personal Loans $58 bn Receivables Management Capitalizing on the Large, Underserved Market Opportunities in Existing and New Verticals Source: Stax – REPAY Market Sizing Report (January 2018) and EY Parthenon – ERP Market Report (September 2019).
Slide 6: Card and Debit Payments Underpenetrated in Existing Verticals
Card Payment Penetration Card and Debit Payments Underpenetrated in Existing Verticals Note: Credit generally not accepted as payment option in REPAY’s legacy end markets. Source: The Nilson Report – December 2018. Represents debit and credit as a percentage of all U.S. consumer payment systems, inc
Slide 7: REPAY Has Built a Leading Platform Based on Vertical Expertise
Attractive value proposition to both merchants and end consumers drives strong client growth and penetration REPAY Has Built a Leading Platform Based on Vertical Expertise Merchants in Existing and New Verticals Consumers Pay Anywhere, Any Way, Any Time Accelerated payment cycle (ability to lend and
Slide 8: Payment Processing Platform provides significant value proposition
Payment Processing Platform provides significant value proposition Opportunity across payment / billing management Payment Channels Debit REPAY Instant Funding Consumer Merchant Receives REPAY Has Built a Leading Platform Based on Vertical Expertise (cont.) 3 REPAY’s model empowers both merchants an
Slide 9: Omni-channel payment and electronic billing platform
REPAY has 3 different web-based solutions, depending on whether merchants are interested in a Virtual Terminal, Online Customer Portal, or a Hosted Payment Page customized to their brand Web REPAY Has Built a Leading Platform Based on Vertical Expertise (cont.) REPAY’s omni-channel payment and elect
Slide 10: Next-Generation Technology Supported by Robust Infrastructure
Next-Generation Technology Supported by Robust Infrastructure 4 Proprietary Technology and Agile Development Integrations with Customers’ Software Systems Underwriting / Regulatory / Industry Compliance Expertise Strong Relationships with Card Associations Proprietary Bank Partnerships Robust Proces
Slide 11: Key Software Integrations Supplement Differentiated Sales Strategy
REPAY leverages a vertically tiered sales strategy supplemented by software integrations to drive new merchant acquisitions Software Integrations Key Software Integrations Supplement REPAY’s Differentiated Sales Strategy Direct sales model that is structured by vertical and by production tier Sales
Slide 12: Attractive and Diverse Client Base
Growth Opportunities Receivables Management Attractive and Diverse Client Base A Market Leader for Over a Decade in the Personal Loans Vertical Firmly Established Foothold in Auto Finance Vertical Future Market Expansion Opportunities – Healthcare, Credit Unions and Canada Personal Loans Automotive
Slide 13: Demonstrated Ability to Acquire and Integrate Businesses
Demonstrated Ability to Acquire and Integrate Businesses 7 REPAY’s proven acquisition strategy illustrates the value of the platform across verticals 2019 APS (B2B) TriSource (Back-End) Acquisition of APS to expand vertically into B2B vertical, REPAY’s fourth vertical Acquisition of REPAY’s primary
Slide 14: TriSource Acquisition Overview
TriSource Acquisition Overview TriSource, founded in 2007, provides back-end transaction processing services to independent sales organizations (“ISO’s”) and operates as a direct ISO on behalf of its owned portfolios and external sales agents “Processing” business – ~70% of 2018 gross profit “Direct
Slide 15: APS Payments Acquisition Overview
APS Payments Acquisition Overview Strategic Rationale Transaction Details APS Overview APS Payments (“APS”) is an integrated payments provider focused on the B2B vertical APS goes to market in the B2B vertical through key integrations with leading ERP platforms Headquartered in Mesa, AZ; employs 46
Slide 16: Multiple Growth Opportunities
Multiple Growth Opportunities REPAY’s leading platform and attractive market opportunity position it to build on its record of robust growth and profitability Expand Usage and Increase Adoption Future Market Expansion Opportunities Strategic M&A Acquire New Merchants in Existing Verticals Leverage p
Slide 17: Successful Leadership Team With Deep Industry Expertise
Successful Leadership Team With Deep Industry Expertise 9 Susan Perlmutter CRO Mike Jackson COO Thomas Sullivan VP, Controller Jake Moore Head of Corporate Development Tyler Dempsey General Counsel REPAY’s leadership team has significant payment expertise and a track-record of success with high-grow
Slide 18: Highly Knowledgeable and Experienced Board of Directors
Highly Knowledgeable and Experienced Board of Directors 9-member Board of Directors comprised of industry veterans and influential leaders in the financial services and payment industries 9 John Morris CEO & Co-Founder Shaler Alias President & Co-Founder Jeremy Schein Managing Director, Corsair Rich
Slide 19: REPAY Financial Overview
REPAY Financial Overview
Slide 20: Financial Highlights
Financial Highlights Source: Management estimates. Source: Management metric for LTM September 30, 2019. Includes TriSource for post-acquisition period. Volume retention for YTD period as of September 30, 2019 calculated as 1 – (Lost Volume / Total Volume Processed in Prior Year Period); “Lost Volum
Slide 21: History of Strong and Continued Card Payment Volume Growth
History of Strong and Continued Card Payment Volume Growth REPAY has generated strong, consistent volume growth, resulting in ~$7.5 bn in annual payment processing volume in 2018 Total Card Payment Volume ($ in bn) Volume Retention REPAY’s integrated payments platform leads to strong same-store sale
Slide 22: Historical and Forecasted Financials
Historical and Forecasted Financials Gross Profit(2) ($ in mm) Gross margins are improving due to a decrease in processing costs Source: Management estimate range for 2019. Reflects expected contribution from the acquisitions of TriSource and APS. Note: Historical CAGR is from 2016A – 2018A. In this
Slide 23: Key Highlights
Key Highlights Low Chargeback rates of 0.20% based on Management data of volume processed through TriSource, representing approximately 80% of total volume. Chargeback rate is YTD as of September 30, 2019. Chargebacks, represented as a % of volume, are debited from the merchant’s account when the en
Slide 24: Q3 2019 Financial Update
Q3 2019 Financial Update Gross Profit is defined as Total Revenue less Interchange and Network Fees and Other Cost of Services. See “Adjusted EBITDA Reconciliation” on slide 28 for reconciliation of Adjusted EBITDA to its most comparable GAAP measure. See “Adjusted Net Income Reconciliation” on slid
Slide 25: Q3 YTD 2019 Financial Update
Q3 YTD 2019 Financial Update Gross Profit is defined as Total Revenue less Interchange and Network Fees and Other Cost of Services. See “Adjusted EBITDA Reconciliation” on slide 28 for reconciliation of Adjusted EBITDA to its most comparable GAAP measure. See “Adjusted Net Income Reconciliation” on
Slide 26: Appendix
Appendix
Slide 27: Income Statement – Historical and Forecasted
Income Statement – Historical and Forecasted Source: Management estimate range for 2019. Reflects expected contribution from the acquisitions of TriSource and APS. Note: This Presentation includes ranges of forecasted 2019 Adjusted EBITDA for REPAY. This Presentation does not provide a reconciliatio
Slide 28: Adjusted EBITDA Reconciliation – Historical
Adjusted EBITDA Reconciliation – Historical Note: This Presentation includes ranges of forecasted 2019 Adjusted EBITDA for REPAY. This Presentation does not provide a reconciliation of this forward-looking non-GAAP financial measure to the most directly comparable GAAP financial measure because calc
Slide 29: Adjusted Net Income Reconciliation – Historical
Adjusted Net Income Reconciliation – Historical Reflects amortization of intangibles acquired as part of (1) the acquisition of Sigma Payment Solutions, Inc, the transaction with REPAY’s prior financial sponsor, and the 2016 recapitalization transaction by Corsair Capital, during the year ended Dece
Slide 30: Depreciation and Amortization Detail – Historical
Depreciation and Amortization Detail – Historical Note: Adjusted Net Income excludes amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions (see corresponding adjustments in
Slide 31: Share Count
Share Count Shares refer to Class A common stock on an as-converted basis. This presentation is not a complete summary of all relevant terms and conditions related to the shares or the warrants, including with respect to the issuance of earn-outs, vesting, release from escrow or other key terms. For