Paysafe Limited · NYSE:PSFE
Paysafe — Non-Deal Roadshow (January 2017)
37 slides from Paysafe's roadshow presentation, January 2017
Slide 1: West Coast Roadshow, January 2017
West Coast Roadshow, January 2017 January 17th-18th 2017
Slide 2: Forward-looking statements
WEST COAST ROADSHOW, JANUARY 2017 1 Certain statements in this document are forward-looking statements. These forward-looking statements speak only as at the date of this document. These statements concern, or may affect, future matters and include matters that are not facts. Such statements are bas
Slide 3: FY 16 trading update
WEST COAST ROADSHOW, JANUARY 2017 2 FY 16 Corporate Appendix: trading strategy H1 16 update results
Slide 4: FY Trading Update
WEST COAST ROADSHOW, JANUARY 2017 FY 16 TRADING UPDATE 3 Beating market consensus Selected highlights include Revenue* expected to exceed: H2 16 organic growth* at least: $1bn 18% a new milestone year on year Continued strong Adjusted EBITDA* expected to reach: Share buy-back launched, up to: moment
Slide 5: FY Trading Update: operational highlights
WEST COAST ROADSHOW, JANUARY 2017 FY 16 TRADING UPDATE 4 • Ended the year with enhanced operations, products and technology to position the business strongly for growth in 2017 • Substantial investment in KYC infrastructure, as well as risk management and compliance capabilities. Underpinning our ab
Slide 6: FY17 outlook: revenue and adjusted EBITDA
WEST COAST ROADSHOW, JANUARY 2017 FY 16 TRADING UPDATE 5 Revenue Adjusted EBITDA Low double-digit At least maintain FY16 organic growth margins • Our ongoing momentum underpins our confidence in our growth prospects for 2017 • We continue to pursue bold M&A opportunities alongside organic growth, in
Slide 7: Corporate strategy
WEST COAST ROADSHOW, JANUARY 2017 6 FY 16 Corporate Appendix: trading strategy H1 16 update results
Slide 8: Our strategic pillars
WEST COAST ROADSHOW, JANUARY 2017 CORPORATE STRATEGY 7 Our strategic pillars Aggressive State-of-the-art Niche-orientated Entrepreneurial Bold M&A organic growth technology solutions culture
Slide 9: Corporate strategy priorities
WEST COAST ROADSHOW, JANUARY 2017 CORPORATE STRATEGY 8 • Focus on relevant differentiated solutions that add value • Expansion into new geographies and developing new business • Fostering an entrepreneurial culture, divisional autonomy to make quick decisions • Staying ahead of and adapting to chang
Slide 10: Technology: Data & Merchant Platform
WEST COAST ROADSHOW, JANUARY 2017 CORPORATE STRATEGY 9 Technology is the foundation of our business: Data & Merchant Platform • Strong focus on innovation • Building out new Data and Merchant Platform Fraud reporting Multi-channel • Hiring top senior talent • New group of highly talented engineers i
Slide 11: Market-leading positions in multiple niches
WEST COAST ROADSHOW, JANUARY 2017 CORPORATE STRATEGY 10 Market-leading position in Releasing new niche-orientated technologies: multiple niches: M O B I L E O R D E R I N G P L AT F O R M • Online gambling App Users • Medium to high risk Simple, Easy, Secure Mobile processing Ordering & Payments • D
Slide 12: Courageous, Pioneering, Open, Focused
WEST COAST ROADSHOW, JANUARY 2017 CORPORATE STRATEGY 11 Courageous Pioneering Open Focused
Slide 13: Bold M&A: deals executed
WEST COAST ROADSHOW, JANUARY 2017 CORPORATE STRATEGY 12 We committed to We continue to seek and execute pursue accretive deals …. and deals with a have delivered strong strategic fit
Slide 14: Paysafe brands
Skrill APaysafe Company Paysafe The point of every payment NETELLER. ‘APaysafe Company @ paysafecard ‘APaysafe Company 74 PAYOLUTION ‘APaysafe Company XZVS ENTERTAINMENT APaysafe Company 13
Slide 15: Appendix: H1 2016 financial results
Appendix: H1 2016 financial results
Slide 16: H1 2016 highlights
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 15 Exceeding expectations Excellent cash generation Revenue Free cash flow* $487m $79m 20% YoY growth* Expanding the core foundations Adjusted EBITDA* Adjusted EBIT cash conversion* of our business $144m 78% 29.6% margin * H1 2016 organic constant currency
Slide 17: Reported revenue and adjusted EBITDA growth
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 16 Reported revenue, $m Reported adjusted EBITDA, $m 1190% share price increase 5-year CAGR - 5-year CAGR - since H1 11 53% 53% 487 86% 86% 144 grow gro wth 223 * 159 50 118 39 79 25 57 6 11 H111 H112 H113 H114 H115 H116 H111 H112 H113 H114 H115 H116 Share
Slide 18: Financial summary and net debt
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 17 $m H1 14 H2 14 H1 15 H2 15 H1 16 Revenue 159.1 205.9 223.0 390.4 486.7 Growth YoY% 34% 53% 40% 90% 118% Pro-forma CC YoY% 23% 14% 12% 14% 20% Adjusted EBITDA 39.0 47.1 49.9 102.7 144.2 Adjusted EBITDA margin 24.5% 22.9% 22.4% 26.3% 29.6% Adjusted FD EPS
Slide 19: H1 2016 pro-forma CC revenue growth
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 18 600 52% 53% 51% 51% 54% 60% H1 2016 YoY 50% pro-forma CC revenue 500 40% growth 400 34 30% Pro-forma revenue 20% 20% 300 195 183 10% Reported revenue 241 487 0% Pro-forma gross margin 200 390 -10% 223 -20% 100 159 206 H1 2016 gross margin -30% 54% 0 -40%
Slide 20: Revenue by geography
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 19 28% 26% 38% 45% 61% 31% 29% Asia / ROW N. America 43% Europe 35% 16% 41% 45% 23% 20% 19% H1 14 H2 14 H1 15 H2 15 H1 16 Fee revenue excludes revenue from investment income; i.e. interest income
Slide 21: Revenue by division, geography and vertical
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 20 Division Geography Vertical Online N. America Europe gambling Prepaid 29% 45% 45% Payment Other 22% Processing 48% 48% Digital Wallets 30% Asia / ROW 26% Gaming 7% Fee revenue excludes revenue from investment income; i.e. interest income Geography: Proce
Slide 22: Payment Processing growth excl. MMAG
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 21 Processing 300.0 45.0% 39% 39% 37% 37% 38% H1 2016 pro-forma 40.0% 250.0 YoY CC growth excl. 35.0% MMAG 200.0 2 30.0% 32% Pro-forma revenue Reported revenue 150.0 53 10 6 231 25.0% 20.0% 100.0 202 15.0% 157 173 Pro-forma gross margin 117 10.0% 50.0 H1 20
Slide 23: Digital Wallets growth
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 22 H1 2016 YoY constant pro-forma currency 72% 73% 72% 74% 77% 80.0% 70.0% growth* YoY CC growth 150 60.0% 28% Pro-forma revenue 100 14 50.0% 40.0% 68 69 66 Reported revenue 147 30.0% 50 109 H1 2016 gross margin Pro-forma gross margin 20.0% 76% 77% 0 41 48
Slide 24: Prepaid growth
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 23 150.0 50% 50% 50% 51% 53% H1 2016 50% pro-forma YoY CC growth* Pro-forma revenue 100.0 40% 11% Reported revenue 116 112 18 30% 50.0 107 105 20% Pro-forma gross margin 76 10% H1 2016 gross margin 53% 0.0 H1 14 H2 14 H1 15 H2 15 H1 16 0% Pro-forma CC* grow
Slide 25: Revenue to adjusted profit
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 24 $m H1 15 % rev % YoY H2 15 % rev % YoY H1 16 % rev % YoY Revenue 223.0 100% 40% 390.4 100% 90% 486.7 100% 118% Gross profit 100.9 45.2% 25% 195.6 50.1% 102% 260.6 53.5% 158% Salaries excl SBP 27.6 12.4% 27% 48.1 12.3% 94% 61.8 12.7% 124% Other administra
Slide 26: Capital expenditure and D&A
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 25 $m H1 15 H2 15 H1 16 PP&E 3.7 2.0 7.9 % sales 1.7% 0.5% 1.6% Capitalisation of development 3.2 9.7 13.0 % sales 1.5% 2.5% 2.7% Other intangible 0.0 5.1 6.6 % sales 0% 1.3% 1.3% Capex 7.0 16.7 27.5 % sales 3.1% 4.3% 5.7% Depreciation 1.4 1.8 3.1 Amortisat
Slide 27: Cash flow and H1 16 capex
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 26 $m H1 14 H2 14 H1 15 H2 15 H1 16 H1 16 Capex Adj EBIT 33.2 41.0 43.2 89.9 129.2 Adj cash conversion before payments working capital Adj free cash flow before payments working capital 92% 30.6 110% 45.1 98% 42.4 89% 79.7 78% 101.0 $27.5m Realised FX gain/
Slide 28: Cash conversion and free cash flow
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 27 Strong EBIT Net debt / pro-forma Free cash flow cash conversion LTM adj EBITDA before PWC 78% 1.5x $79m Free cash flow $m Free cash flow Free cash flow before PWC • We continuously review our 79 73 capital allocation policy and the potential for returnin
Slide 29: Transaction volumes and revenue / volume
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 28 Pro-forma Reported H1 14 H2 14 H1 15 H2 15 H1 16 Payment Processing 8.3 8.3 8.2 8.9 11.2 Revenue / volume 2.0% 2.0% 2.2% 2.3% 2.1% Digital Wallets 9.1 9.8 9.7 10.2 11.3 Revenue / volume 1.2% 1.2% 1.2% 1.2% 1.3% Prepaid 1.5 1.5 1.4 1.3 1.4 Revenue / volum
Slide 30: Currency exposure
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 29 • USD and EUR main revenue and cost exposure Main components of revenue and total cost* • EUR vs USD profit sensitivity partly hedged by EUR debt Revenue USD EUR GBP CAD • Cash & cash equivalents are mainly USD and EUR 40% 30% 5% 3% denominated Total cos
Slide 31: Fee revenue and gross profit by division
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 30 Fee revenue* $m H1 15 H2 15 H1 16 Revenue Prepaid Payment Payment Processing 173.0 202.0 231.2 22% Processing Digital Wallets 49.8 109.4 146.7 48% Prepaid 76.4 105.5 Interest income 0.2 2.5 3.4 Total 223.0 390.4 486.7 Digital Wallets Gross profit 30% Pay
Slide 32: Balance sheet
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 31 $m 30 Jun 2015 31 Dec 15 30 Jun 16 Non current assets 298.0 1,569.3 1,602.2 Cash & cash equivalents excl. rights issue 113.3 117.9 160.2 Rights issue cash 685.3 - - Total cash & cash equivalents 798.6 117.9 160.2 Restricted cash 8.4 29.1 33.9 Cash held a
Slide 33: Profit after tax to adjusted profit
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 32 $m H1 15 H2 15 H1 16 Profit after tax 2.4 5.0 64.5 Tax 2.2 2.2 10.0 Profit before tax 4.6 7.2 74.6 Foreign exchange (gain) / loss 5.8 3.9 6.4 Acquisition, restructuring, and other exceptional costs 16.5 21.3 6.5 Share based payments 7.1 7.0 5.5 FV gains
Slide 34: Profit to free cash flow reconciliation
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 33 $m H1 15 H2 15 H1 16 Profit after tax 2.4 5.0 64.5 Tax 2.2 2.2 10.0 Profit before tax 4.6 7.2 74.6 Depreciation and amortisation 14.8 36.5 40.6 FX, exceptionals, (gains)/losses 22.8 29.6 -1.9 Finance cost 2.7 9.5 16.1 Op CF before movements in working ca
Slide 35: Adjusted EBIT to free cash flow
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 34 $m H1 13 H2 13 H1 14 H2 14 H1 15 H2 15 H1 16 Adj EBIT 20.5 21.5 33.2 41.0 43.2 89.9 129.2 Adj depreciation & amortisation 4.8 5.4 5.8 6.1 6.7 12.8 14.9 Adj EBITDA 25.3 26.9 39.0 47.1 49.9 102.7 144.2 Working capital movement2 -0.2 4.0 -3.0 3.8 0.2 -6.3 -
Slide 36: Debt facilities and net debt
WEST COAST ROADSHOW, JANUARY 2017 APPENDIX 35 • 3.5x covenant net debt to EBITDA at time of $m 31 Dec 15 30 Jun 16 acquisition announcement, reduced to 1.5x Current portion of long-term debt & cap lease 30.9 31.3 at period end LT debt and capital lease 493.3 489.3 Deferred financing fees* 21.6 19.3
Slide 37: Paysafe Group plc contact details
Paysafe Group plc Registered Office & Headquarters 3rd Floor Queen Victoria House 41-43 Victoria Street Douglas Isle of Man IM1 2LF +44 (0) 1624 698700 Michelle Singleton, VP Investor Relations: +44 (0) 20 3826 9800 / investorrelations@paysafe.com Gavin Haycock, SVP Corporate Communications: +44 (0)