Slide 1: Investor Presentation
Investor Presentation October 2020
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: Investment Highlights
Investment Highlights Transaction Processor Uniquely Focused on Latin America 1 Resilient Business Model 2 Attractive Secular Industry Trends 3 4 Comprehensive and Scalable Service Offering Aligned Strategic Growth Initiatives 5 3
Slide 4: Transaction Processor Uniquely Focused on Latin America
1 Transaction Processor Uniquely Focused on Latin America
Slide 5: A Comprehensive and Scalable End-to-End Payments Processor…
A Comprehensive and Scalable End-to-End Payments Processor… Front-End Merchant Back-End Merchant Reporting and Loyalty & Rewards Customer Service & Processing Processing Analytics Programs Support Merchant Acquiring (19%1) Card Issuer Electronic Benefit Payment ATH Network Acquirer Processing Electr
Slide 6: … With A Unique Focus on Latin American Markets …
… With A Unique Focus on Latin American Markets … Snapshot of Regional Operating Platform, EVTC Operating Footprint in Numbers +2,400 Employees across 11 Countries including +1,000Outside of PR +30,000 Merchants Served +80,000 POS Terminals +2,000 Connected ATMs Presence in 26 Countries 6
Slide 7: … And a Growing Record of Partnerships …
… And a Growing Record of Partnerships … Year 2015 2017 2019 2019 2019 Entered Country / Region Colombia Chile Mexico and Guatemala Chile Colombia ▪ Acquired 65% stake ▪ Acquired 100% of EFT ▪ Expanded regional ▪ 5-year processing ▪ Acquired 100% in Processa, a Group S.A., a agreement with agreement
Slide 8: … Led By A Team of Proven Industry Professionals
… Led By A Team of Proven Industry Professionals Mac Schuessler President and CEO +5 years of experience with Evertec. Former President of International for Global Payments with +20 years of payment industry leadership experience Joaquin Castrillo Chief Financial Officer Luis A. Rodriguez +8 years o
Slide 9: Resilient Business Model
2 Resilient Business Model
Slide 10: Attractive Cash Flow Generation and Strong Liquidity
Attractive Cash Flow Generation and Strong Liquidity Free Cash Flow(1) ▪ Attractive cash flow generation despite Hurricane Increased ($ in millions) COVID-19 headwinds Maria Capex o Hurricane Maria occurred September $126 $131 2017 $120 $118 $112 o Increased one-time technology spend in 2019 ~$15M f
Slide 11: Resilient, Recurring and Growing Revenue Base
Resilient, Recurring and Growing Revenue Base Revenue Base Overview Historical Revenue, by Segment ($ in millions) ▪ Resilient revenue base with no segment representing the majority of revenue ▪ Long-term contracts with financial institutions, merchants, corporations and governments $504 $487 − Cont
Slide 12: Regional Operating Scale Driving Industry Leading Margins and Financial Results
Regional Operating Scale Driving Industry Leading Margins and Financial Results Operating Scale As a Key Strategic Advantage Adjusted EBITDA(1) ($ in millions) $232 $226 ▪ Operating presence in 11 countries; headquartered in San Juan, Puerto Rico $212 − Commercial presence in 26 countries $188 ▪ Ope
Slide 13: Disciplined Approach to Capital Deployment
Disciplined Approach to Capital Deployment • Maintenance capital expenditures of ~$20-$25M Priority – Invest for • Growth capital expenditures of ~$20-$25M* Growth, Internal & M&A • Potential acquisition targets typically up to $100M ‒ Revolver capacity of $125M Target Leverage of • Capacity of 4.25
Slide 14: Attractive Secular Industry Trends
3 Attractive Secular Industry Trends
Slide 15: Significant Opportunity in Large, Underpenetrated Regional Market
Significant Opportunity in Large, Underpenetrated Regional Market Bank Account Penetration Among Adults by Region1 • Increasing proportion of banked customers from previously unbanked population 94% % Total Adult Population 69% 62% • Shift from paper (cash & check) to electronic forms of 51% 51% 46%
Slide 16: … And Benefit from Revitalization of Puerto Rico
… And Benefit from Revitalization of Puerto Rico • Promesa plan includes $83 billion over 15 years(1) Rebuilding and Relief Funds • HUD appoints financial monitor and releases $8.5 billion • FEMA funds of $13B released under President’s executive order • Judicial approval of the COFINA restructuring
Slide 17: Comprehensive and Scalable Service Offering
4 Comprehensive and Scalable Service Offering
Slide 18: Comprehensive Suite of Value-Adding Payments Services …
Comprehensive Suite of Value-Adding Payments Services … PR │ LatAm ▪ Issuing, acquiring & switch modules ▪ End-to-end platform to issue, route, authorize, settle and administer card programs ▪ Comprehensive POS and Internet card payment solutions ▪ Analytics-driven fraud monitoring & detection platf
Slide 19: ... With Growing Portfolio of Digital Payments Solutions …
... With Growing Portfolio of Digital Payments Solutions … ▪ P2P/B payments service and acquiring platform ▪ P2B platform allows merchants to receive mobile ✓ Own and operate PIN debit payments from registered ATH debit card users network enabling merchants to accept ATH debit cards +1.2M +35k +200M
Slide 20: Aligned Strategic Growth Initiatives
5 Aligned Strategic Growth Initiatives
Slide 21: Aligned Strategic Initiatives to Drive Growth
Aligned Strategic Initiatives to Drive Growth Payment Services Puerto Rico & Merchant Acquiring Payment Services LatAm Business Solutions Caribbean Create leading digital payment Convert license-based to processing Leverage local capability to develop experience by continuously products to drive hig
Slide 22: … And a Commitment to Environment, Social and Governance Priorities
… And a Commitment to Environment, Social and Governance Priorities* Evertec is committed to conducting our business operations in a manner that is Environment compatible and balanced with the communities that we serve and promoting efforts that reduce our environmental footprint and use of natural
Slide 23: Appendix
A Appendix
Slide 24: Non-GAAP Reconciliation Summary
Non-GAAP Reconciliation Summary 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 m
Slide 25: Non-GAAP Reconciliation Annual Results Summary
Non-GAAP Reconciliation Annual Results Summary GAAP Net Income to Adjusted EBITDA ($ in millions) 2016 2017 2018 2019 3Q20 LTM Net Income (loss) $ 75.1 $ 55.4 $ 86.6 $ 103.7 $ 97.5 Income tax expense (benefit) 8.3 4.8 12.6 13.0 18.5 Interest expense, net 24.2 29.1 29.3 27.6 23.9 Depreciation and amo
Slide 26: Non-GAAP Reconciliation Summary
Non-GAAP Reconciliation Summary Free Cash Flow ($ in millions) 12/31/2016 12/31/2017 12/31/2018 12/31/2019 3Q20 LTM Operating Cash Flows $ 168.1 $ 145.8 $ 172.7 $ 179.9 $ 164.9 Capital Expenditures(1) (42.3 $ (33.5) (41.3) (59.9) (46.8) Free Cash Flow(2) $ 125.8 $ 112.3 $ 131.4 $ 120.0 $ 118.1 Notes
Slide 27: Non-GAAP Reconciliation Summary
Non-GAAP Reconciliation Summary Net Debt to Adjusted EBITDA ($ in millions) 12/31/2016 12/31/2017 12/31/2018 12/31/2019 3Q20 LTM Unrestricted Cash ($51.9) ($50.4) ($69.9) ($111.0) ($144.1) Total Debt 663.5 624.7 545.3 533.4 504.7 Net Debt $611.6 $574.3 $475.4 $422.4 $360.6 Adjusted EBITDA LTM 187.6
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation Segment Revenues and Adjusted EBITDA ($ in millions) LTM ended September 30, 2020 Payment Services - Payment Services - Merchant Corporate and Puerto Rico & Business Solutions Total Latin America Acquiring, net Other(1) Caribbean Revenues $ 123.3 $ 84.6 $ 107.7 $ 231.6 $ (43.
Slide 29: Technology that speaks your language
ome evertec ° Technology that speaks your language