Slide 1: Earning Presentation H1-2024
Feel good about payments EARNING PRESENTATION H1 - 2024 October 1st, 2024
Slide 2: Agenda
AGENDA 1. AccelR8 execution 2. H1-2024 Business and Financial review 3. Q&A session
Slide 3: AccelR8 Execution
01 AbdeslamALAOUI SMAILI CEO ACCELR8 EXECUTION
Slide 4: Environment & HPS Positioning
01. ACCELR8 EXECUTION ENVIRONMENT & HPS POSITIONNING
Slide 5: Market Global Dynamic
Market Global Dynamic Non-cash transaction volume should grow by 15% p.a. in the next 5 years, mainly driven by the accelerated transition of less mature countries Global non-cash transaction volume [# bn; 2017-2027F] Source: National statistics, National central banks, ECB Statistical Data, Desk re
Slide 6: Value creation leverages
Value creation leverages Top Market Trends Top Regulatory Challenges Durbin Amendment and the risk of Alternative payment methods and introduction of CBDC future interchange regulations Growth of buy now, pay later (BNPL) use GDPR compliance requirements Declining cash usage ISO 20022 messaging stan
Slide 7: Provider strength
HPS, well positioned to capture value as a leading actor Provider strength Leading competitors Heat Map INCUMBENT Provider Client Client Product Vendors stability strength service features 91% 92% 90% 80% 87% 91% 92% 91% 83% 86% 93% 85% 85% 88% 91% 88% 91% 92% 88% 89% CONTENDERS HPS HPS 91% 91% 89%
Slide 8: Main Achievements of AccelR8
01. ACCELR8 EXECUTION MAIN ACHIEVEMENTS OF ACCELR8
Slide 9: AccelR8 in numbers
AccelR8 in numbers CAGR : 25% HPS in 2022 Non-recurring HPS in 2027 Non-recurring 15% 29% Between Organic growth $220m Recurring $100m 12% < CAGR < 17% and Recurring 48% Regular 60% $300m Regular 25% External growth 23% from $40m to $80m EBITDA margin from 25% to 30% Resilience 60% recurring in 2027
Slide 10: Strong impact of PowerCARD V4 on sales
Strong impact of PowerCARD V4 on sales ⏵PowerCARD V4, a unique micro-service & Cloud-native technology that accelerate the growth - HPS is witnessing unprecedented demand for its products, and specially Tier 1 banks, and we are continuing our efforts and deploying the required platforms to capture t
Slide 11: CR2 Acquisition
CR2 Acquisition CR2 proprietary BankWorld software platform powers 90+ banks across more than 50 countries around the world across 4 continents Digital Banking Digital Wallet Payment Hub Global Presence Payment Integrations Bank Ecosystem Integrations Remittance, bill payment aggregators, card Core
Slide 12: CR2 Acquisition
CR2 Acquisition An acquisition with solid value creation prospects Revenue synergies Strategic Rationale ▪ Unlocks the next stage of HPS’s development, Offering proven HPS Capturing new cross- Expand Group’s Acceleration ▪ Enhanced Value Proposition: Combining Bankworld SaaS business and selling opp
Slide 13: H1-2024 Business & Financial Review
02 Brahim BERRADA Corporate Services Managing Director H1-2024 BUSINESS & FINANCIAL REVIEW
Slide 14: Key Figures & Main Considerations
02. H1-2024 BUSINESS & FINANCIAL REVIEW KEY FIGURES & MAIN CONSIDERATIONS
Slide 15: H1-2024 Key Figures
H1-2024 Key Figures REVENUE EBITDA / MARGIN BACKLOG 578 MMAD 108 MMAD 18.6% 810 MMAD +2.4% Growth -5.6% Growth -1.4% Growth SEGMENT PERFOMANCE PAYMENT ACTIVITY SWITCHING ACTIVITY TESTING ACTIVITY 85% 8% 7% 462 MMAD 43 MMAD 42 MMAD +1.3% Growth +12.9% Growth -6.3% Growth © 2024 HIGHTECH PAYMENT SYSTE
Slide 16: Impact of SaaS model on Revenues and EBITDA
Impact of SaaS model on Revenues and EBITDA Since 2017, HPS started a transformation by introducing the SaaS model. The -35 M M A D acceleration of the last 2 years (100% of sales in 2023 are SaaS and 40% of Total H1-2024 impact pipeline opportunities as well) has impacted revenues and margins in th
Slide 17: Impact of SaaS model on Revenues and EBITDA
Impact of SaaS model on Revenues and EBITDA CUMULATIVE REVENUES SAAS vs ON-PREMISE EBITDA MARGIN EVOLUTION OVER 10 YEARS (*) (*) 50% of new sales in SaaS with an increase of new sales by 10% every year Run phase Run phase Maintenance phase Maintenance phase Implementation phase Implementation phase
Slide 18: H1-2024 Adjusted Key Figures
H1-2024 Adjusted Key Figures REVENUE EBITDA / MARGIN BACKLOG 613 MMAD 143 MMAD 23.3% 810 MMAD +8.7% Growth +25.4% Growth -1.4% Growth SEGMENT PERFOMANCE PAYMENT ACTIVITY SWITCHING ACTIVITY TESTING ACTIVITY 85% 8% 7% 497 MMAD 43 MMAD 42 MMAD +9.0% Growth +12.9% Growth -6.3% Growth © 2024 HIGHTECH PAY
Slide 19: AccelR8 key objectives
AccelR8 key objectives GEOGRAPHICAL REVENUE EBITDA MARGIN RESILIENCE PRESENCE 2022 2027 2022 2027 2022 2027 2022 2027 220 MUSD 25% 100 MUSD to 20% to 48% 60% 15% 30% 300 MUSD 30% HPS objective is to accelerate The EBITDA margin improvement Resilience of HPS activity will by Asia and the Americas are
Slide 20: AccelR8 objectives
AccelR8 objectives Despite some elements that impact HPS' growth in the short term (transition to the SaaS REVENUE model and a delay in sales in 2023 and H1-2024), HPS remains aligned with the objectives 2022 2027 set thanks to the acquisition of CR2 (integrated here on the basis of a full year) Fur
Slide 21: AccelR8 objectives
AccelR8 objectives The EBITDA margin deteriorates in 2023 and 2024 in a consistent manner with the EBITDA MARGIN acceleration of the SaaS model and due to heavy investment projects (Convergence 2022 2027 program and construction of the SaaS offer). Margin expansion should return in 2025 and accelera
Slide 22: AccelR8 objectives
AccelR8 objectives Recurring revenue contribution expected to grow strongly as major SaaS contracts go into RESILIENCE production 2022 2027 48% 60% (*) 2024 recurring revenue is estimated based on the same recurring revenue as H1- Recurring: 60% 2024 2022 2023 2024(*) 2025 2026 2027 © 2024 HIGHTECH
Slide 23: AccelR8 objectives
AccelR8 objectives GEOGRAPHICAL HPS is slightly ahead of AccelR8 in 2024. PRESENCE The very strong growth in sales in these 2 regions (those already signed and those in 2022 2027 progress for 2024) should reinforce this trend for the years to come 15% 30% Americas & Asia: 30% (*) 2024 Americas & Asi
Slide 24: Payment Activity Review
02. H1-2024 BUSINESS & FINANCIAL REVIEW PAYMENT ACTIVITY REVIEW
Slide 25: Payment Activity - Business review
Payment Activity - Business review SaaS Model Share in Consolidated Revenues ⏵Successful deployment of the 1st phase ⏵Sale of SaaS model to 3 new customers of the Canadian Bank. The SaaS in Jamaica. 1 started in H1 and the services will start in October based on deployment is ongoing on the AWS an A
Slide 26: Payment Activity - Financial review
Payment Activity - Financial review (in K MAD) ⏵New Projects implementation Delay of sales during 2023 and H1-2024 due to long selection process of Tier 1 banks Impact of SaaS model acceleration since 2022 impacting revenue recognition New orders expected in H2-2024 and the ramp-up of SaaS contracts
Slide 27: Payment Activity - Outlook
Payment Activity - Outlook Very strong rebound in sales in the second half of 2024 ⏵4 banks ranked in the world's top 100 have selected HPS technology - One of the largest bank in Australia already signed for HPS SaaS offering and the project is under deployment. Once delivered, this bank will be th
Slide 28: Switching Activity Review
02. H1-2024 BUSINESS & FINANCIAL REVIEW SWITCHING ACTIVITY REVIEW
Slide 29: Switching Activity - Business review
Switching Activity - Business review Cards Switching Mobile Switching Share in Consolidated Revenues ⏵ Exceeding for the 1st time 1 million ⏵ Migration of the Mobile Switch to the new payment transactions per day platform ⏵ Onboarding CITIBANK and CHARI (B2B e- ⏵ Deployment of a dispute management c
Slide 30: Switching Activity - Evolution of interoperability
Switching Activity - Evolution of interoperability Withdrawals Payment transactions e-Commerce transactions Annual growth over 4 (Millions) (Millions) (Millions) years 15,5% 15% 14,7% 16% 12,5% 15,4% 30,3% 18,8% 20,4% 81.1 161.6 41,3% +23.1% 60.9 70.3 32,3% 121.4 139.3 40,9% 39.4 44.2 52.8 93.0 33.2
Slide 31: Financial Performance Review
02. H1-2024 BUSINESS & FINANCIAL REVIEW FINANCIAL PERFORMANCE REVIEW
Slide 32: Costs analysis
Costs analysis ⏵ HR Costs stable: 332 MMAD vs. 331 MMAD (+0.3%) • Headcount increase (+7.2%) to support business growth and decrease of external resources • Decrease of external resources to reduce the average cost of HR ⏵ Sales & Marketing costs: 10.7 MMAD vs. 6.4 MMAD (+68%) • Strong sales and mar
Slide 33: Reported and adjusted EBITDA
Reported and adjusted EBITDA (in MMAD) +25.7% Adjusted growth ⏵Impact of SaaS model on revenue: 20.2% 18.6% 23.2% -35 MMAD (-6.2%) • The deployment of SaaS projects contributed 35 MMAD to the revenue in H1-2024 +35 142 • These projects do not generate License revenue, which is estimated at 50% of th
Slide 34: Cash Flow analysis
Cash Flow analysis +36 -7.5 -18.6 211 -7.1 LT Debt compared to equity 214 107 MMAD 14.5% -7.8% growth Cash position in MMAD - CAGR 25% End 2023 cash Operations Investments Financing Currency End June 2024 305 position exchange cash position 224 238 211 214 ⏵ Operational cash flow +36 M MAD Optimal m
Slide 35: Backlog
Backlog NON-RECURRING 16% Compared to annual Revenues Switch 9% Projects SaaS 16% 810 MMAD 68% 29% -1.3% growth Upselling 16% Click fee 1% Maintenance 28% Backlog in MMAD - CAGR 12.3% 934 821 810 STABLE 16% 733 RECURRING 68% 573 ⏵ Delay in sales in 2023 and H1-2024due to longer negotiations on Tier
Slide 36: Key takeaways
Key takeaways Successful AccelR8 Execution Strong sales growth in 2024 Positive outlook • CR2 acquisition, aligned with • 4 of world’s top 100 banks HPS’ confidence in the ability to AccelR8 M&A program selected HPS and should sign in deliver sustainable growth aligned • Acceleration of SaaS model w
Slide 37: Disclaimer about forward looking statements
Disclaimer about forward looking statements This presentation (“Presentation”) has been prepared by Hightech Payment Systems S.A. (”HPS” or the “Company”). This Presentation may contain forward-looking statements within the meaning of applicable Moroccan securities laws, including, but not limited t
Slide 38: Invest@hps-worldwide.com
Invest@hps-worldwide.com