Cpi Card Group Inc. · NASDAQ:PMTS
Cpi Card — Q1 2024 Earnings Presentation
17 slides from Cpi Card's earnings presentation, May 7, 2024
Slide 1: First Quarter 2024 Investor Presentation
First Quarter 2024 Investor Presentation May 7, 2024
Slide 2: Cautionary Statements
Cautionary Statements Forward Looking Statements Certain statements and information in this presentation (as well as information included in other written or oral statements we make from time to time) may contain or constitute “forward-looking statements” within the meaning of the Private Securities
Slide 3: Agenda
Agenda 1 Overview and Strategy 2 Q1 Financial Review 3 2024 Outlook 4 Summary CPI Confidential and Proprietary | Not for distribution 3
Slide 4: Overview
Overview Q1 performance improvement Expected declines in debit and credit card volumes partially offset by strong growth in Prepaid solutions, Card@Once® instant issuance and card personalization services Gross margin increase; solid cash flow generation Sequential improvement from Q4 2024 net
Slide 5: Strategy Review
Strategy Review Build from Strong Foundation A leader in the U.S. payments market with portfolio that includes Secure Card, Personalization, Instant Issuance and Prepaid Strong value proposition from our focus on customer service, quality and innovation o New contract signed in Q1 with one of ou
Slide 6: Visa and Mastercard U.S. Cards in Circulation
Visa and Mastercard U.S. Cards in Circulation Cards in circulation have grown at a 9% CAGR over the last three years to 2.0 billion, up from 1.5 billion cards in 2020 2,023 1,942 1,971 1,885 1,915 1,829 1,758 1,783 1,714 1,679 1,627 1,587 738 1,543 725 694 713 679 674 645 656 616 636 606 600 599 1,2
Slide 7: 2024 Q1 Financial Review
2024 Q1 Financial Review CPI Confidential and Proprietary | Not for distribution 7
Slide 8: Q1 Highlights
Q1 Highlights Q1 results impacted by cautious customer spending on cards, as expected, but decreases partially offset by strong growth in Prepaid and other services businesses Net sales decreased 7% to $111.9 million Net income decreased 50% to $5.5 million; net income margin decreased from 9.0%
Slide 9: First Quarter Financial Highlights
First Quarter Financial Highlights (in millions, except per share data) Q1 24 Q1 23 % Change Commentary Net Sales $111.9 $120.9 -7% Net sales decrease driven primarily by reduced card volumes in our Debit and Credit segment, partially Gross Profit $ 41.5 $ 43.1 -4% offset by growth from Prepaid, i
Slide 10: Financial Highlights - Segments
Financial Highlights - Segments $ in millions Debit and Credit Prepaid Debit Q1 Net Sales & Operating Income Q1 Net Sales & Operating Income $94.2 $102.0 29.4% 25.9% 24.0% 29.8% 26.9% 26.9% $8.7 $30.0 $22.8 $94.2 $102.0 $3.7 $88.0 $19.1 $24.2 29.4% 25.9% 19.2% 36.1% 2023 2024 2023 2024 2023 2024 202
Slide 11: Balance Sheet, Liquidity, Net Leverage and Cash Flow
Balance Sheet, Liquidity, Net Leverage and Cash Flow $ in millions, except ratios Our capital structure and allocation Mar. 31, Dec. 31, strategies are focused on: Balance Sheet, Liquidity and Net Leverage Rat 2024 2023 1. Maintaining ample liquidity Cash on hand $ 17.1 $ 12.4 2. Investing in the bu
Slide 12: 2024 Outlook
2024 Outlook Affirmed full year outlook for net sales and Adjusted EBITDA; adjusted Free Cash Flow outlook to reflect incentives on customer contract win Full-year outlook 2024 Slight increase in both Net Sales and Adjusted EBITDA¹ Free Cash Flow approximately half the 2023 level due to increase
Slide 13: Summary
Summary First quarter results improved from recent trends Customers continue to work down card inventories, but strong growth from Prepaid and other services businesses Sequential improvement from Q4 Full year net sales and Adjusted EBITDA outlook affirmed Gradual market recovery expected over
Slide 14: Contact
Contact (877) 369-9016 investorrelations@cpicardgroup.com www.cpicardgroup.com 14
Slide 15: Reconciliations of Non-GAAP Financial Measures
Reconciliations of Non-GAAP Financial Measures Adjusted EBITDA and Adjusted EBITDA Margin Three Months Ended March 31, 2024 2023 Reconciliation of net income to EBITDA and Adjusted EBITDA: ($ in millions) EBITDA represents earnings before interest, taxes, depreciation and amortization, all Net incom
Slide 16: Reconciliations of Non-GAAP Financial Measures
Reconciliations of Non-GAAP Financial Measures Last Twelve Months Ended 2024 2023 Reconciliation of net income to LTM EBITDA and Adjusted EBITDA: ($ in millions) LTM Adjusted EBITDA Net income Interest, net $ 18.6 26.6 $ 24.0 26.9 Income tax expense 9.8 10.5 We define LTM Adjusted EBITDA as adjusted
Slide 17: Supplemental Financial Measures
Supplemental Financial Measures Net Leverage Ratio March 31, 2024 As of December 31, 2023 Management and various investors use the ratio of debt Calculation of Net Leverage Ratio: ($ in millions) principal outstanding, plus finance lease obligations, less Senior Notes $ 267.9 $ 267.9 cash divided by