Payoneer Global Inc. · NASDAQ:PAYO
Payoneer Global — Q4 2023 Earnings Presentation
26 slides from Payoneer Global's earnings presentation, Feb 28, 2024
Slide 1: 4Q 2023 Earnings Supplement
4Q 2023 Earnings Supplement Nasdaq: PAYO February 28, 2024
Slide 2: Disclaimers
Disclaimers This presentation does not constitute an offer to sell, a solicitation of an Non-GAAP Financial Measures See the appendix of this presentation for a reconciliation of the historic offer to buy, or a recommendation to purchase any security. You should measures to Payoneer's most comparabl
Slide 3: Payoneer's mission: connect the world's underserved businesses
Payoneer’s mission: Connect the world’s underserved businesses to a rising, global economy 3
Slide 4: Payoneer at a glance: strong growth and significant profitability
Payoneer at a glance: strong growth and significant profitability Revenue ($M) Adjusted EBITDA ($M) 32% $831 323% $205 Active Ideal Customer customer countries Profiles (ICPs)1, +6% year- and territories over-year $628 of 2023 volume2, +11% of 2023 operating cash flow, year-over-year, highlighting +
Slide 5: Global expansion is essential for SMBs but cross-border is complex
Global expansion is essential for today’s SMBs but transacting across borders is complex Can’t get paid Can’t pay Can’t get capital Why does international money How can I use my card for global Why don't local lenders underwrite transfer take 3-4 business days? advertising without it being rejected?
Slide 6: 80M underserved SMBs
Global banks 80M Underserve small businesses underserved SMBs Fintech Primarily for P2P, and Need cross-border, with limited geographies B2B financial solutions designed for small Local banks businesses Underserve cross-border needs Source: Third-party research. 6
Slide 7: Payoneer is the multi-currency financial stack optimized for the global SMB
Payoneer is the multi-currency financial stack optimized for the global SMB Merchant services Pay (Checkout) Invoice Financial stack Payoneer card for global SMBs Load funds Manage and optimize Move money financial operations, including: Marketplace payout • Treasury Pay vendors, suppliers, • Curren
Slide 8: We have unique assets and infrastructure
We have unique assets and infrastructure • Financial services institution regulated • Virtual account so customers are • 1.96M active customers, including across key markets, including US, always local, no matter where they 516K active Ideal Customer Europe, Hong Kong, Japan, Australia, are and who
Slide 9: We serve diverse customer types and use cases
We serve diverse customer types and use cases Contractors and Consumer goods Service Goods traders freelancers sellers providers and manufacturers Contractors and freelancers paid B2C sellers selling on Service SMBs in IT, business SMB exporters of electronics, auto- by marketplaces (Upwork, Fiverr)
Slide 10: Payoneer helps SMBs in the fastest growing markets do business globally
Payoneer helps SMBs in the fastest growing markets do business globally Business process Software Producer and seller of outsourcing in the development 3D printers in China Philippines contractor in Brazil 10
Slide 11: We are pursuing a $6 trillion opportunity
We are pursuing a $6 trillion opportunity Audiences Manufacturers Services SMBs Goods merchants Contractors / freelancers Marketplace SMB Consumers SMB SMB Businesses Cross-border payment needs Source: Third-party research. Industry data and Payoneer volume market share as of 2022. 11
Slide 12: 4Q 2023 business and financial highlights
4Q 2023 business and financial highlights 12
Slide 13: We introduced our SMB-centric strategy in 2023 and are delivering results
We introduced our SMB-centric strategy in 2023 and are delivering results Acquire and retain more (‘000s) Optimize ($) 6% 516 488 4Q22 4Q23 Note: ARPU represents the trailing twelve months as of each quarter shown. Please refer to the disclaimers at the beginning of the presentation for the ARPU def
Slide 14: Faster ICP growth in higher take rate regions and larger ICPs
We are driving faster ICP growth in higher take rate regions and with larger, higher volume ICPs Active ICPs (‘000s) Active ICPs (‘000s) 516 516 488 488 +15% 67 55 60 48 YoY +13% 101 93 YoY in higher take rate regions 103 121 440 461 +5% YoY 92 98 113 100 28 29 4Q22 4Q23 4Q22 4Q23 N. America Europe
Slide 15: Strong volume growth from the diverse channels our customers sell through
Strong volume growth from the diverse channels our customers sell through SMB customer volume Enterprise volume Defend our market leading Accelerate growth in a Expand into a fast-growing Drive continued scaled, position massive market market efficient growth 4% (13% excluding proactive customer 9%
Slide 16: Our revenue is diversified, with two fast-growing, higher take rate businesses
Our revenue is diversified, and we have two fast- growing, higher take rate businesses within Payoneer Revenue from B2B SMBs year-over-year Interest 14% Revenue from Merchant Services income on 1% year-over-year customer 28% funds of revenue from SMB customers using our $831M financial stack of 2023
Slide 17: We are trusted and growing customer funds
We are trusted and growing customer funds Customer funds ($B) • 80%+ of customer funds are interest-bearing 9% • 74% of customer funds are held with U.S. domestic $6.4 financial institutions $5.8 • 75% of customer funds are denominated in U.S. dollars • Launched program to extend duration of custome
Slide 18: We are delivering operating leverage
We are delivering operating leverage Transaction cost as a percentage of revenue Adj. EBITDA ($M) and adj. EBITDA margin (%) 393% $52 40 bps 23% 16.6% 16.2% 6% $11 4Q22 4Q23 4Q22 4Q23 Note: Data as of December 31, 2023. Please refer to the appendix of this presentation for the reconciliation from ne
Slide 19: Strong cash flow enables capital returns and strategic flexibility
Our strong cash flow generation enables us to return capital to shareholders and maintain strategic flexibility Operating cash flows ($M) $159M $57M $617M $159 Operating Share Cash and cash cash flows1 repurchases2 equivalents $84 $20 2021 2022 2023 Note: data as of December 31, 2023. 1. For the per
Slide 20: 2024 full year guidance as of February 28, 2024
2024 full year guidance as of February 28, 2024 $875-885M ~17.5% $185-195M Revenue Transaction costs as a % Adjusted EBITDA 1 of revenue Guidance for fiscal year, where adjusted, is provided on a non-GAAP basis, which Payoneer will continue to identify as it reports its future financial results. The
Slide 21: Our roadmap to profitable growth
Our roadmap to profitable growth Medium-term Long-term (through 2026) (beyond 2026) Mid-teens 20%+ revenue growth revenue growth 25% 25%+ Adjusted EBITDA margin Adjusted EBITDA margin 21
Slide 22: Appendix
Appendix ©Payoneer
Slide 23: Volume and revenue trends
Volume and revenue trends Volume ($M) 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 YoY QoQ SMBs that sell on marketplaces $9,321 $9,239 $9,406 $10,487 $9,770 $9,921 $10,261 $11,777 12% 15% B2B SMBs 1,622 1,791 1,760 1,914 1,678 1,759 1,781 2,156 13% 21% Merchant services 2 8 11 20 29 41 63 102 408% 61% S
Slide 24: ICP and revenue by region trends
ICP and revenue by region trends Active ICPs ('000s) 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 YoY QoQ By size: $500-$10K/month 410 423 433 440 441 443 449 461 5% 3% $10K+/month 43 44 46 48 50 52 53 55 15% 3% Total 453 467 479 488 491 495 502 516 6% 3% By primary regional market: APAC 92 97 100 103 10
Slide 25: Reconciliation of net income (loss) to adjusted EBITDA
Reconciliation of net income (loss) to adjusted EBITDA Twelve months ended, Three months ended, ($ in thousands) Dec. 31, 2022 Dec. 31, 2023 Dec. 31, 2022 Dec. 31, 2023 Net income (loss) $ (11,970) $ 93,333 $ (10,151) $ 27,021 Depreciation & amortization 20,858 27,814 5,333 8,750 Taxes on income 13,
Slide 26: Thank you.
Thank you. payoneer.com