Priority Technology Holdings, Inc. · NASDAQ:PRTH
Priority Technology — Q1 2023 Earnings Presentation
19 slides from Priority Technology's earnings presentation, May 11, 2023
Slide 1: Supplemental Slides: Q1 2023 Earnings Call
Priority Technology Holdings, Inc. (Nasdaq: PRTH) Supplemental Slides: Q1 2023 Earnings Call May 11, 2023
Slide 2: Disclaimer
DISCLAIMER Important Notice Regarding Forward-Looking Statements and Non-GAAP Measures This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about future financia
Slide 3: Key 1st Quarter 2023 Highlights
Key 1st Quarter 2023 Highlights Q1 2023 PERFORMANCE METRICS CONTINUED STRONG MOMENTUM REVENUE ADJ GROSS REVENUE ADJUSTED PROFIT1 In Millions EBITDA1 $740 - $755 In Millions $160 - $165 21% $15 22% $5 Guidance Guidance Range Range ADJUSTED OPERATING EBITDA1 INCOME $740 $160 $664 $140 24% 57% $515 $70
Slide 4: First Quarter 2023 Consolidated Results
First Quarter 2023 Consolidated Results 21% 22% 30BP 24% $185.0M $63.1M 34.1% $37.6M $153.2M $51.8M 33.8% $30.3 Q1 22 Q1 23 Q1 22 Q1 23 Q1 22 Q1 23 Q1 22 Q1 23 Revenue grew Adj Gross Profit1 Adj Gross Profit Adjusted EBITDA1 21% to $185.0 increased 22% margin1 increased of $37.6 million million to $
Slide 5: Priority Unified Commerce Platform
Priority Unified Commerce Platform S M B AC Q U I R I N G P R I O R I TY B 2 B ENTERPRISE C U R AT E D A P P S MX Merchant MX POS CPX CFTPay MX Retail LandlordStation MX Connect CPX API CFTConnect MX Restaurant e|tab MX QSR PayRight Passport API MX Build MX Givv Passport Account U/I BANKING Passport
Slide 6: Priority is Simplifying the Customer Experience
Priority is Simplifying the Customer Experience Working with Priority is as Easy as 1, 2, 3 1 Choose the Curated App(s) that best fit your needs 2 Chose the Passport Account Structure that best fits your uses 3 Start Moving Money 6
Slide 7: Financial Results
(D PRIORITY Financial Results
Slide 8: First Quarter 2023 – SMB (Revenue)
First Quarter 2023 – SMB (Revenue) Key Revenue Drivers 19% SMB revenue of $154.9 million increased 19% from $130.0 million in Q1 2022 $154.9M $130.0M Bankcard $ Volumes of $15.2 billion increased over 8% Average Merchant Count of 260K increased by 7% Q1 22 Q1 23 New Merchant Boards averaged ~5
Slide 9: First Quarter 2023 – SMB (Profits)
First Quarter 2023 – SMB (Profits) 8% 240BP 4% $35.4M $32.9M 25.3% $12.0M 22.9% $12.5M Q1 22 Q1 23 Q1 22 Q1 23 Q1 22 Q1 23 Adj Gross Profit1 Adj Gross Profit Operating increased 8% to margin1 Income of $12.0 $35.4 million decreased 240 million basis points to decreased 4% 22.9% 9 1Adjusted Gross Pro
Slide 10: First Quarter 2023 – B2B (Revenue)
First Quarter 2023 – B2B (Revenue) 53% Key Revenue Drivers B2B revenue of $2.8 million decreased 53% from $5.9 million $5.9M $2.8M Largely driven by Managed Services decrease from $2.6 million to $0.3 million due to final wind down of a specific customer Q1 22 Q1 23 program CPX decreased slightl
Slide 11: First Quarter 2023 – B2B (Profits)
First Quarter 2023 – B2B (Profits) 38% 1720 300% BP $0.4M 71.4% $3.2M ($0.8M) $2.0M 54.2% Q1 22 Q1 23 Q1 22 Q1 23 Q1 22 Q1 23 Adj Gross Profit1 Adj Gross Profit Operating Loss of decreased 38% margin1 increased $0.8 million to $2.0 million from 54.2% to decreased from 71.4% Operating income of $0.4M
Slide 12: First Quarter 2023 – Enterprise (Revenue)
First Quarter 2023 – Enterprise (Revenue) Key Revenue Drivers 57% ENTERPRISE revenue of $27.3 million increased 57% from $17.3 million $27.3M $17.3M Avg Monthly New Enrollments of 46K increased 100% from 23K Q1 22 Q1 23 Avg Number of Billed Clients increased 34% to 465K from 346K Increase in d
Slide 13: First Quarter 2023 – Enterprise (Profits)
First Quarter 2023 – Enterprise (Profits) 64% 390BP 182% $25.7M $15.7M $12.7M 94.1% 90.2% $4.5M Q1 22 Q1 23 Q1 22 Q1 23 Q1 22 Q1 23 Adj Gross Profit1 Adj Gross Profit Operating increased 64% margin1 increased Income of $12.7 to $25.7 390 basis million million points to 94.1% increased 182% 13 1Adjus
Slide 14: Operating Expenses
Operating Expenses Operating Expenses of $46.2 million increased 13% 19% 21% 3% $9.1M $19.1M $7.5M $18.0M $16.1M $17.4M Q1 22 Q1 23 Q1 22 Q1 23 Q1 22 Q1 23 Salaries & Benefits SG&A increased 21% Depreciation & increased 19% to $19.1 to $9.1 million Amortization of $18.0 million million increased 3%
Slide 15: Adjusted EBITDA Walk
Adjusted EBITDA1 Walk Adjusted EBITDA experienced strong growth in Q1 2023 Q1 2023 Adjusted EBITDA of $37.6 million increased 24.1% from $30.3 million in Q1 2022 EBITDA Walk (In millions) 2023 2022 Q1 Q1 Consolidated net income (loss) (GAAP) $ (0.5) $ (0.3) Add: Interest expense 17.7 11.5 Add: Dep
Slide 16: Outstanding Debt
Outstanding Debt Total Debt of $615.7 million at end of Q1 2023 decreased from $623.2 million in 2022 Decrease driven by net $6.0 million Revolver decrease and $1.5 million in Term Loan Repayments Net Debt of $599.8 million decreased $4.7 million compared to 2022 Revolver Capacity at the end o
Slide 17: Senior Redeemable Preferred Stock
Senior Redeemable Preferred Stock Preferred Stock of $235.4 million, Net of $20.3 million of Unaccreted Discounts and Issuance Costs First Quarter Dividends and Accretion as follows: 1st Quarter (dollars in Millions) 2023 In Millions Dividend: Payment in Kind $ 4.38 Cash 6.10 10.48 Accretion 0.81
Slide 18: Appendix
(D PRIORITY APPENDIX
Slide 19: Adjusted Gross Profit Reconciliation
Adjusted Gross Profit Reconciliation The reconciliation of adjusted gross profit to its most comparable GAAP measure is provided below: (in Millions) (in Millions) Three Months Ended March 31, 2023 Three Months Ended March 31, 2022 SMB B2B Enterprise Total SMB B2B Enterprise Total Revenues $ 154.9 $
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