false000172059200017205922025-03-032025-03-03
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Date of Report (Date of earliest event reported): March 03, 2025 |
REPAY HOLDINGS CORPORATION
(Exact name of Registrant as Specified in Its Charter)
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Delaware |
001-38531 |
98-1496050 |
(State or Other Jurisdiction
of Incorporation) |
(Commission File Number) |
(IRS Employer
Identification No.) |
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3060 Peachtree Road NW Suite 1100 |
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Atlanta, Georgia |
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30305 |
(Address of Principal Executive Offices) |
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(Zip Code) |
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Registrant’s Telephone Number, Including Area Code: 404 504-7472 |
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading
Symbol(s) |
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Name of each exchange on which registered
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Class A common stock, par value $0.0001 per share |
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RPAY |
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The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On March 3, 2025, Repay Holdings Corporation (the “Company”) issued a press release announcing the results of the Company’s operations for the quarter and year ended December 31, 2024.
A copy of the Company’s press release is attached hereto as Exhibit 99.1 and is hereby incorporated by reference in this Item 2.02. As provided in General Instruction B.2 of Form 8-K, the information and exhibits contained in this Item 2.02 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall they be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 7.01. Regulation FD Disclosure.
On March 3, 2025, the Company provided supplemental information regarding its business and operations in an earnings supplement and investor presentation that will be made available on the investor relations section of the Company’s website.
Copies of the earnings supplement and investor presentation are attached hereto as Exhibits 99.2 and 99.3 and are hereby incorporated by reference in this Item 7.01. As provided in General Instruction B.2 of Form 8-K, the information and exhibits contained in this Item 7.01 shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, nor shall they be deemed to be incorporated by reference in any filing under the Securities Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Repay Holdings Corporation |
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Dated: March 3, 2025 |
By: |
/s/ Timothy J. Murphy |
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Timothy J. Murphy |
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Chief Financial Officer |
REPAY Reports Fourth Quarter and Full Year 2024 Financial Results
Gross Profit Growth of 2% in Q4 and 6% Full Year 2024
Strong Adjusted EBITDA Growth and Accelerated Free Cash Flow Conversion during 2024
Announces Strategic Review Process, including Potential Strategic Alternatives
ATLANTA, March 3, 2025 -- Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY” or the “Company”), a leading provider of vertically-integrated payment solutions, today reported financial results for its fourth quarter and full year ended December 31, 2024.
Fourth Quarter 2024 Financial Highlights
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($ in millions) |
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Q4 2023 |
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Q1 2024 |
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Q2 2024 |
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Q3 2024 |
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Q4 2024 |
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YoY
Change |
Revenue |
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$ |
76.0 |
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$ |
80.7 |
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$ |
74.9 |
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$ |
79.1 |
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$ |
78.3 |
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3% |
Gross profit (1) |
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58.7 |
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61.5 |
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58.6 |
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61.6 |
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59.7 |
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2% |
Net (loss) income (2) |
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(77.7 |
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(5.4 |
) |
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(4.2 |
) |
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3.2 |
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(4.0 |
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– |
Adjusted EBITDA (3) |
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33.5 |
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35.5 |
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33.7 |
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35.1 |
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36.5 |
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9% |
Net cash provided by operating activities |
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34.9 |
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24.8 |
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31.0 |
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60.1 |
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34.3 |
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(2%) |
Free Cash Flow (3) |
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21.8 |
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13.7 |
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19.3 |
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48.8 |
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23.5 |
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8% |
Free Cash Flow Conversion (3) |
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65 |
% |
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38 |
% |
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57 |
% |
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139 |
% |
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64 |
% |
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(1)Gross profit represents revenue less costs of services (exclusive of depreciation and amortization).
(2)During the fourth quarter of 2023, Net loss was impacted by a $75.7 million goodwill impairment loss. Further information about this non-cash impairment loss can be found in our Annual Report on Form 10-K for the year ended December 31, 2024.
(3)Adjusted EBITDA, Free Cash Flow and Free Cash Flow Conversion are non-GAAP financial measures. See “Non-GAAP Financial Measures” and the reconciliation of Adjusted EBITDA, Free Cash Flow and Free Cash Flow Conversion to their most comparable GAAP measure provided below for additional information.
“Q4 closed out the year with another quarter of profitable growth at REPAY,” said John Morris, CEO of REPAY. “Our full year results showcased our resilient business model with strong double digit Adjusted EBITDA growth and accelerating Free Cash Flow Conversion from 42% in 2023 to 75% in 2024. As we reflect on the accomplishments we achieved in 2024 and turn to 2025, we remain dedicated to delivering the best payment experience for our clients and creating value by facilitating the ongoing secular shift to more digital payment flows.
REPAY has built our technology platform to scale both organically and inorganically, with the potential to benefit from additional opportunities ahead. With the Board’s support, we have commenced a comprehensive strategic review, with the assistance of outside advisors, to assess a full range of alternatives aimed at capturing shareholder value. The review includes evaluating opportunities to further strengthen REPAY’s position in the verticals we serve, adjacent end markets, GTM strategy, relationships with our partners, and capital allocation. This strategic review may also include consideration of various strategic alternatives, including M&A, a sale or take private of the Company and other structural changes, transactions and alternatives that could enhance shareholder value.”
REPAY has not set a deadline for the completion of the review process, and there can be no assurance that the strategic review will result in any particular outcome, transaction, or other
strategic alternative. REPAY does not intend to comment further or provide updates regarding the strategic review until it has been completed, unless the Company determines that additional disclosure is appropriate or required by law.
Fourth Quarter 2024 Business Highlights
The Company's achievements in the quarter, including those highlighted below, reinforce management's belief in the ability of the Company to drive durable and sustained growth across REPAY's diversified business model.
•2% year-over-year gross profit growth in Q4
•Consumer Payments gross profit declined approximately 5% year-over-year which was partially impacted from clients rolling off during the fourth quarter
•Business Payments gross profit growth of approximately 60% year-over-year as we benefited from strong contributions in our political media vertical
•Accelerated AP supplier network to over 360,000, an increase of approximately 38% year-over-year
•Added four new integrated software partners to bring the total to 280 software relationships as of the end of the fourth quarter
•Instant funding volumes increased by approximately 34% year-over-year
•Added 16 new credit unions bringing total credit union clients to 329
Segments
The Company reports its financial results based on two reportable segments.
Consumer Payments – The Consumer Payments segment provides payment processing solutions (including debit and credit card processing, Automated Clearing House (“ACH”) processing and other electronic payment acceptance solutions, as well as REPAY’s loan disbursement product) that enable REPAY’S clients to collect payments from and disburse funds to consumers and includes its clearing and settlement solutions (“RCS”). RCS is REPAY’s proprietary clearing and settlement platform through which it markets customizable payment processing programs to other ISOs and payment facilitators. The strategic vertical markets served by the Consumer Payments segment primarily include personal loans, automotive loans, receivables management, credit unions, mortgage servicing, consumer healthcare and diversified retail.
Business Payments – The Business Payments segment provides payment processing solutions (including accounts payable automation, debit and credit card processing, virtual credit card processing, ACH processing and other electronic payment acceptance solutions) that enable REPAY’s clients to collect payments from or send payments to other businesses. The strategic vertical markets served within the Business Payments segment primarily include retail automotive, education, field services, governments and municipalities, healthcare, media, homeowner association management and hospitality.
Segment Revenue, Gross Profit, and Gross Profit Margin
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Three Months Ended December 31, |
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Year Ended December 31, |
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($ in thousand) |
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2024 (Unaudited) |
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2023 (Unaudited) |
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% Change |
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2024 |
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2023 |
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% Change |
Revenue |
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Consumer Payments |
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$ |
66,349 |
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$ |
71,124 |
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(7%) |
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$ |
280,966 |
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$ |
275,708 |
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2% |
Business Payments |
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17,357 |
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9,850 |
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76% |
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52,923 |
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38,058 |
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39% |
Elimination of intersegment revenues |
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(5,435 |
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(4,987 |
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(20,847 |
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(17,139 |
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Total revenue |
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$ |
78,271 |
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$ |
75,987 |
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3% |
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$ |
313,042 |
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$ |
296,627 |
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6% |
Gross profit (1) |
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Consumer Payments |
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$ |
53,081 |
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$ |
56,168 |
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(5%) |
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$ |
223,107 |
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$ |
216,096 |
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3% |
Business Payments |
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12,069 |
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7,545 |
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60% |
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39,146 |
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27,967 |
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40% |
Elimination of intersegment revenues |
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(5,435 |
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(4,987 |
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(20,847 |
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(17,139 |
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Total gross profit |
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$ |
59,715 |
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$ |
58,726 |
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2% |
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$ |
241,406 |
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$ |
226,924 |
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6% |
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Total gross profit margin (2) |
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76% |
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77% |
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77% |
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77% |
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(1)Gross profit represents revenue less costs of services (exclusive of depreciation and amortization).
(2)Gross profit margin represents total gross profit / total revenue.
Conference Call
REPAY will host a conference call to discuss fourth quarter and full year 2024 financial results today, March 3, 2025 at 5:00 pm ET. Hosting the call will be John Morris, CEO, and Tim Murphy, CFO. The call will be webcast live from REPAY’s investor relations website at https://investors.repay.com/investor-relations. The conference call can also be accessed live over the phone by dialing (877) 407-3982, or for international callers (201) 493-6780. A replay will be available one hour after the call and can be accessed by dialing (844) 512-2921 or (412) 317-6671 for international callers; the conference ID is 13750988. The replay will be available at https://investors.repay.com/investor-relations.
Non-GAAP Financial Measures
This report includes certain non-GAAP financial measures that management uses to evaluate the Company’s operating business, measure performance, and make strategic decisions. Adjusted EBITDA is a non-GAAP financial measure that represents net income prior to interest expense, tax expense, depreciation and amortization, as adjusted to add back certain charges deemed to not be part of normal operating expenses, non-cash charges and/or non-recurring charges, such as loss on business disposition, gain on extinguishment of debt, non-cash change in fair value of contingent consideration, non-cash impairment loss, non-cash change in fair value of assets and liabilities, share-based compensation charges, transaction expenses, restructuring and other strategic initiative costs and other non-recurring charges. Adjusted Net Income is a non-GAAP financial measure that represents net income prior to amortization of acquisition-related intangibles, as adjusted to add back certain charges deemed to not be part of normal operating expenses, such as loss on business disposition, gain on extinguishment of debt, non-cash change in fair value of contingent consideration, non-cash impairment loss, non-cash change in fair value of assets and liabilities, share-based compensation expense, transaction expenses, restructuring and other strategic initiative costs, other non-recurring charges, non-cash interest expense and net of tax effect associated with these adjustments. Adjusted Net Income is adjusted to exclude
amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions. Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although REPAY excludes amortization from acquisition-related intangibles from its non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Adjusted Net Income per share is a non-GAAP financial measure that represents Adjusted Net Income divided by the weighted average number of shares of Class A common stock outstanding (on an as-converted basis assuming conversion of the outstanding units exchangeable for shares of Class A common stock) for the three months and years ended December 31, 2024 and 2023 (excluding shares subject to forfeiture). Free Cash Flow is a non-GAAP financial measure that represents net cash flow provided by operating activities less total capital expenditures. Free Cash Flow Conversion represents Free Cash Flow divided by Adjusted EBITDA. REPAY believes that Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income per share, Free Cash Flow and Free Cash Flow Conversion provide useful information to investors and others in understanding and evaluating its operating results in the same manner as management. However, these non-GAAP financial measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating profit, net cash provided by operating activities, or any other operating performance measure calculated in accordance with GAAP. Using these non-GAAP financial measures to analyze REPAY’s business has material limitations because the calculations are based on the subjective determination of management regarding the nature and classification of events and circumstances that investors may find significant. In addition, although other companies in REPAY’s industry may report measures titled as the same or similar measures, such non-GAAP financial measures may be calculated differently from how REPAY calculates its non-GAAP financial measures, which reduces their overall usefulness as comparative measures. Because of these limitations, you should consider REPAY’s non-GAAP financial measures alongside other financial performance measures, including net income, net cash provided by operating activities and REPAY’s other financial results presented in accordance with GAAP.
Forward-Looking Statements
This communication 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 financial and operating results, REPAY’s plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as “guidance,” “will likely result,” “are expected to,” “will continue,” “should,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. These forward-looking statements include, but are not limited to, statements regarding the strategic review process, REPAY’s market and growth opportunities, REPAY’s business strategy and the plans and objectives of management for future operations and the allocation of capital. Such forward-looking statements are based upon the current beliefs and expectations of REPAY’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond REPAY’s control.
In addition to factors disclosed in REPAY’s reports filed with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2024 and those identified elsewhere in this communication, the following factors, among others, could cause actual results and the timing of events to differ materially from the anticipated results or
other expectations expressed in the forward-looking statements: risks or uncertainties relating to the outcome or timing of REPAY’s strategic review process, exposure to economic conditions and political risk affecting the consumer loan market, the receivables management industry and consumer and commercial spending, including bank failures or other adverse events affecting financial institutions, inflationary pressures, general economic slowdown or recession; changes in the payment processing market in which REPAY competes, including with respect to its competitive landscape, technology evolution or regulatory changes; changes in the vertical markets that REPAY targets, including the regulatory environment applicable to REPAY’s clients; the ability to retain, develop and hire key personnel; risks relating to REPAY’s relationships within the payment ecosystem; risk that REPAY may not be able to execute its growth strategies, including identifying and executing acquisitions; risks relating to data security; changes in accounting policies applicable to REPAY; and the risk that REPAY may not be able to maintain effective internal controls.
Actual results, performance or achievements may differ materially, and potentially adversely, from any projections and forward-looking statements and the assumptions on which those forward-looking statements are based. There can be no assurance that the data contained herein is reflective of future performance to any degree. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance. All information set forth herein speaks only as of the date hereof in the case of information about REPAY or the date of such information in the case of information from persons other than REPAY, and REPAY disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this communication. Forecasts and estimates regarding REPAY’s industry and end markets are based on sources it believes to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part. Pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.
About REPAY
REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.
Contacts
Investor Relations Contact for REPAY:
ir@repay.com
Media Relations Contact for REPAY:
Kristen Hoyman
(404) 637-1665
khoyman@repay.com
Consolidated Statement of Operations
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Three Months ended December 31, |
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Year ended December 31, |
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($ in thousands, except per share data) |
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2024 (Unaudited) |
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2023 (Unaudited) |
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2024 |
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2023 |
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Revenue |
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$ |
78,271 |
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$ |
75,987 |
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$ |
313,042 |
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$ |
296,627 |
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Operating expenses |
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Costs of services (exclusive of depreciation and amortization shown separately below) |
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$ |
18,556 |
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17,261 |
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$ |
71,636 |
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$ |
69,703 |
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Selling, general and administrative |
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36,503 |
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36,679 |
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145,466 |
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148,653 |
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Depreciation and amortization |
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24,382 |
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24,711 |
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103,710 |
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103,857 |
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Loss on business disposition |
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— |
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— |
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— |
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10,027 |
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Impairment loss |
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— |
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75,750 |
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— |
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75,800 |
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Total operating expenses |
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$ |
79,441 |
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$ |
154,401 |
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$ |
320,812 |
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$ |
408,040 |
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Loss from operations |
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$ |
(1,170 |
) |
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$ |
(78,414 |
) |
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$ |
(7,770 |
) |
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$ |
(111,413 |
) |
Other income (expense) |
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Interest income |
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1,629 |
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1,260 |
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5,992 |
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|
2,822 |
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Interest expense |
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(3,134 |
) |
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(895 |
) |
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(7,873 |
) |
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(3,870 |
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Gain on extinguishment of debt |
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— |
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— |
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13,136 |
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— |
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Change in fair value of tax receivable liability |
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(1,785 |
) |
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(2,903 |
) |
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(14,543 |
) |
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(6,619 |
) |
Other income (loss) |
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76 |
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(145 |
) |
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138 |
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(455 |
) |
Total other income (expense) |
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(3,214 |
) |
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(2,683 |
) |
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(3,150 |
) |
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(8,122 |
) |
Income (loss) before income tax benefit (expense) |
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(4,384 |
) |
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(81,097 |
) |
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(10,920 |
) |
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(119,535 |
) |
Income tax benefit (expense) |
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426 |
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3,423 |
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575 |
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|
2,115 |
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Net income (loss) |
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$ |
(3,958 |
) |
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$ |
(77,674 |
) |
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$ |
(10,345 |
) |
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$ |
(117,420 |
) |
Net loss attributable to non-controlling interest |
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158 |
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(4,387 |
) |
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|
(189 |
) |
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(6,930 |
) |
Net income (loss) attributable to the Company |
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$ |
(4,116 |
) |
|
$ |
(73,287 |
) |
|
$ |
(10,156 |
) |
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$ |
(110,490 |
) |
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Weighted-average shares of Class A common stock outstanding - basic |
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88,392,571 |
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91,206,870 |
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89,915,137 |
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90,048,638 |
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Weighted-average shares of Class A common stock outstanding - diluted |
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88,392,571 |
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91,206,870 |
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89,915,137 |
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90,048,638 |
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Income (loss) per Class A share - basic |
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$ |
(0.05 |
) |
|
$ |
(0.80 |
) |
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$ |
(0.11 |
) |
|
$ |
(1.23 |
) |
Income (loss) per Class A share - diluted |
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$ |
(0.05 |
) |
|
$ |
(0.80 |
) |
|
$ |
(0.11 |
) |
|
$ |
(1.23 |
) |
Consolidated Balance Sheets
|
|
|
|
|
|
|
|
|
($ in thousands) |
|
December 31, 2024 |
|
|
December 31, 2023 |
|
Assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
189,530 |
|
|
$ |
118,096 |
|
Current restricted cash |
|
|
35,654 |
|
|
|
11,324 |
|
Accounts receivable, net |
|
|
32,950 |
|
|
|
36,017 |
|
Prepaid expenses and other |
|
|
17,114 |
|
|
|
15,209 |
|
Total current assets |
|
|
275,248 |
|
|
|
180,646 |
|
|
|
|
|
|
|
|
Property and equipment, net |
|
|
2,383 |
|
|
|
3,133 |
|
Noncurrent restricted cash |
|
|
11,525 |
|
|
|
14,725 |
|
Intangible assets, net |
|
|
389,034 |
|
|
|
447,141 |
|
Goodwill |
|
|
716,793 |
|
|
|
716,793 |
|
Operating lease right-of-use assets, net |
|
|
11,142 |
|
|
|
8,023 |
|
Deferred tax assets |
|
|
163,283 |
|
|
|
146,872 |
|
Other assets |
|
|
2,500 |
|
|
|
2,500 |
|
Total noncurrent assets |
|
|
1,296,660 |
|
|
|
1,339,187 |
|
Total assets |
|
$ |
1,571,908 |
|
|
$ |
1,519,833 |
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Accounts payable |
|
$ |
28,912 |
|
|
$ |
22,030 |
|
Accrued expenses |
|
|
55,501 |
|
|
|
32,906 |
|
Current operating lease liabilities |
|
|
1,230 |
|
|
|
1,629 |
|
Current tax receivable agreement ($2,413 and $68 held for related parties as of December 31, 2024 and December 31, 2023, respectively) |
|
|
16,337 |
|
|
|
580 |
|
Other current liabilities |
|
|
267 |
|
|
|
318 |
|
Total current liabilities |
|
|
102,247 |
|
|
|
57,463 |
|
|
|
|
|
|
|
|
Long-term debt |
|
|
496,778 |
|
|
|
434,166 |
|
Noncurrent operating lease liabilities |
|
|
10,507 |
|
|
|
7,247 |
|
Tax receivable agreement, net of current portion ($25,134 and $25,348 held for related parties as of December 31, 2024 and December 31, 2023, respectively) |
|
|
187,308 |
|
|
|
188,331 |
|
Other liabilities |
|
|
1,899 |
|
|
|
1,838 |
|
Total noncurrent liabilities |
|
|
696,492 |
|
|
|
631,582 |
|
Total liabilities |
|
$ |
798,739 |
|
|
$ |
689,045 |
|
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity |
|
|
|
|
|
|
Class A common stock, $0.0001 par value; 2,000,000,000 shares authorized, 93,732,227 issued and 88,239,494 outstanding as of December 31, 2024; 92,220,494 issued and 90,803,984 outstanding as of December 31, 2023 |
|
|
9 |
|
|
|
9 |
|
Class V common stock, $0.0001 par value; 1,000 shares authorized and 100 shares issued and outstanding as of December 31, 2024 and 2023 |
|
|
— |
|
|
|
— |
|
Treasury stock, 1,416,510 and 1,416,510 shares as of December 31, 2024 and December 31, 2023, respectively |
|
|
(53,782 |
) |
|
|
(12,528 |
) |
Additional paid-in capital |
|
|
1,148,871 |
|
|
|
1,151,324 |
|
Accumulated deficit |
|
|
(333,826 |
) |
|
|
(323,670 |
) |
Total Repay stockholders’ equity |
|
|
761,272 |
|
|
|
815,135 |
|
Non-controlling interests |
|
|
11,897 |
|
|
|
15,653 |
|
Total equity |
|
$ |
773,169 |
|
|
$ |
830,788 |
|
Total liabilities and equity |
|
$ |
1,571,908 |
|
|
$ |
1,519,833 |
|
Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
($ in thousands) |
|
2024 |
|
|
2023 |
|
Cash flows from operating activities |
|
|
|
|
|
|
Net income (loss) |
|
$ |
(10,345 |
) |
|
$ |
(117,420 |
) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
103,710 |
|
|
|
103,857 |
|
Stock based compensation |
|
|
24,388 |
|
|
|
22,156 |
|
Amortization of debt issuance costs |
|
|
3,030 |
|
|
|
2,847 |
|
Loss on business disposition |
|
|
— |
|
|
|
10,027 |
|
Gain on extinguishment of debt |
|
|
(13,136 |
) |
|
|
— |
|
Other loss |
|
|
— |
|
|
|
238 |
|
Fair value change in tax receivable agreement liability |
|
|
14,543 |
|
|
|
6,619 |
|
Impairment loss |
|
|
— |
|
|
|
75,800 |
|
Deferred tax expense (benefit) |
|
|
(2,490 |
) |
|
|
(3,594 |
) |
Change in accounts receivable, net |
|
|
3,067 |
|
|
|
(3,986 |
) |
Change in prepaid expenses and other |
|
|
(1,905 |
) |
|
|
2,936 |
|
Change in operating lease ROU assets |
|
|
(3,119 |
) |
|
|
1,328 |
|
Change in accounts payable |
|
|
6,882 |
|
|
|
(189 |
) |
Change in accrued expenses and other |
|
|
22,594 |
|
|
|
3,890 |
|
Change in operating lease liabilities |
|
|
2,861 |
|
|
|
(1,388 |
) |
Change in other liabilities |
|
|
10 |
|
|
|
493 |
|
Net cash provided by operating activities |
|
|
150,090 |
|
|
|
103,614 |
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(989 |
) |
|
|
(733 |
) |
Purchases of intangible assets |
|
|
— |
|
|
|
(13,545 |
) |
Capitalized software development costs |
|
|
(43,864 |
) |
|
|
(50,083 |
) |
Proceeds from sale of business, net of cash retained |
|
|
— |
|
|
|
40,273 |
|
Net cash used in investing activities |
|
|
(44,853 |
) |
|
|
(24,088 |
) |
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
Issuance of long-term debt |
|
|
287,500 |
|
|
|
— |
|
Payments on long-term debt |
|
|
(205,150 |
) |
|
|
(20,000 |
) |
Payments of debt issuance costs |
|
|
(9,631 |
) |
|
|
— |
|
Payments for tax withholding related to shares vesting under Incentive Plan and ESPP |
|
|
(2,131 |
) |
|
|
(1,891 |
) |
Treasury shares repurchased |
|
|
(41,541 |
) |
|
|
(2,528 |
) |
Stock options exercised |
|
|
395 |
|
|
|
— |
|
Distributions to Members |
|
|
(2,349 |
) |
|
|
(3,525 |
) |
Purchase of capped calls related to issuance of the 2029 Notes |
|
|
(39,186 |
) |
|
|
— |
|
Payment of Tax Receivable Agreement (“TRA”) |
|
|
(580 |
) |
|
|
— |
|
Payments of contingent consideration up to acquisition date fair value |
|
|
— |
|
|
|
(1,000 |
) |
Net cash used in financing activities |
|
|
(12,673 |
) |
|
|
(28,944 |
) |
|
|
|
|
|
|
|
Increase in cash, cash equivalents and restricted cash |
|
|
92,564 |
|
|
|
50,582 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
$ |
144,145 |
|
|
$ |
93,563 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
236,709 |
|
|
$ |
144,145 |
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION |
|
|
|
|
|
|
Cash paid during the year for: |
|
|
|
|
|
|
Interest |
|
$ |
4,843 |
|
|
$ |
1,024 |
|
Income taxes |
|
$ |
2,811 |
|
|
$ |
1,330 |
|
|
|
|
|
|
|
|
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted EBITDA
For the Three Months Ended December 31, 2024 and 2023
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
($ in thousands) |
|
2024 |
|
|
2023 |
|
Revenue |
|
$ |
78,271 |
|
|
$ |
75,987 |
|
Operating expenses |
|
|
|
|
|
|
Costs of services (exclusive of depreciation and amortization shown separately below) |
|
$ |
18,556 |
|
|
$ |
17,261 |
|
Selling, general and administrative |
|
|
36,503 |
|
|
|
36,679 |
|
Depreciation and amortization |
|
|
24,382 |
|
|
|
24,711 |
|
Impairment loss |
|
|
— |
|
|
|
75,750 |
|
Total operating expenses |
|
$ |
79,441 |
|
|
$ |
154,401 |
|
Loss from operations |
|
$ |
(1,170 |
) |
|
$ |
(78,414 |
) |
Other income (expense) |
|
|
|
|
|
|
Interest income |
|
|
1,629 |
|
|
|
1,260 |
|
Interest expense |
|
|
(3,134 |
) |
|
|
(895 |
) |
Change in fair value of tax receivable liability |
|
|
(1,785 |
) |
|
|
(2,903 |
) |
Other income (loss) |
|
|
76 |
|
|
|
(145 |
) |
Total other income (expense) |
|
|
(3,214 |
) |
|
|
(2,683 |
) |
Income (loss) before income tax benefit (expense) |
|
|
(4,384 |
) |
|
|
(81,097 |
) |
Income tax benefit (expense) |
|
|
426 |
|
|
|
3,423 |
|
Net income (loss) |
|
$ |
(3,958 |
) |
|
$ |
(77,674 |
) |
|
|
|
|
|
|
|
Add: |
|
|
|
|
|
|
Interest income |
|
|
(1,629 |
) |
|
|
(1,260 |
) |
Interest expense |
|
|
3,134 |
|
|
|
895 |
|
Depreciation and amortization (a) |
|
|
24,382 |
|
|
|
24,711 |
|
Income tax (benefit) expense |
|
|
(426 |
) |
|
|
(3,423 |
) |
EBITDA |
|
$ |
21,503 |
|
|
$ |
(56,751 |
) |
|
|
|
|
|
|
|
Non-cash impairment loss (b) |
|
|
— |
|
|
|
75,750 |
|
Non-cash change in fair value of assets and liabilities (c) |
|
|
1,785 |
|
|
|
3,778 |
|
Share-based compensation expense (d) |
|
|
5,921 |
|
|
|
5,899 |
|
Transaction expenses (e) |
|
|
297 |
|
|
|
921 |
|
Restructuring and other strategic initiative costs (f) |
|
|
5,524 |
|
|
|
3,372 |
|
Other non-recurring charges (g) |
|
|
1,440 |
|
|
|
520 |
|
Adjusted EBITDA |
|
$ |
36,470 |
|
|
$ |
33,489 |
|
|
|
|
|
|
|
|
Quarterly Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted EBITDA
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months ended |
|
(in $ thousands) |
|
March 31, 2024 |
|
|
June 30, 2024 |
|
|
September 30, 2024 |
|
Net income (loss) |
|
$ |
(5,365 |
) |
|
$ |
(4,237 |
) |
|
$ |
3,215 |
|
|
|
|
|
|
|
|
|
|
|
Add: |
|
|
|
|
|
|
|
|
|
Interest expense (income), net |
|
|
(380 |
) |
|
|
(554 |
) |
|
|
1,310 |
|
Depreciation and amortization (a) |
|
|
27,028 |
|
|
|
26,771 |
|
|
|
25,529 |
|
Income tax (benefit) expense |
|
|
302 |
|
|
|
(1,975 |
) |
|
|
1,524 |
|
EBITDA |
|
$ |
21,585 |
|
|
$ |
20,005 |
|
|
$ |
31,578 |
|
|
|
|
|
|
|
|
|
|
|
Gain on extinguishment of debt (i) |
|
|
— |
|
|
|
— |
|
|
|
(13,136 |
) |
Non-cash change in fair value of assets and liabilities (c) |
|
|
2,913 |
|
|
|
3,366 |
|
|
|
6,479 |
|
Share-based compensation expense (d) |
|
|
6,923 |
|
|
|
5,874 |
|
|
|
6,477 |
|
Transaction expenses (e) |
|
|
677 |
|
|
|
414 |
|
|
|
937 |
|
Restructuring and other strategic initiative costs (f) |
|
|
2,184 |
|
|
|
2,584 |
|
|
|
2,202 |
|
Other non-recurring charges (g) |
|
|
1,231 |
|
|
|
1,485 |
|
|
|
562 |
|
Adjusted EBITDA |
|
$ |
35,513 |
|
|
$ |
33,728 |
|
|
$ |
35,099 |
|
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted EBITDA
For the Years Ended December 31, 2024 and 2023
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
($ in thousands) |
|
2024 |
|
|
2023 |
|
Revenue |
|
$ |
313,042 |
|
|
$ |
296,627 |
|
Operating expenses |
|
|
|
|
|
|
Costs of services (exclusive of depreciation and amortization shown separately below) |
|
$ |
71,636 |
|
|
$ |
69,703 |
|
Selling, general and administrative |
|
|
145,466 |
|
|
|
148,653 |
|
Depreciation and amortization |
|
|
103,710 |
|
|
|
103,857 |
|
Loss on business disposition |
|
|
— |
|
|
|
10,027 |
|
Impairment loss |
|
|
— |
|
|
|
75,800 |
|
Total operating expenses |
|
$ |
320,812 |
|
|
$ |
408,040 |
|
Loss from operations |
|
$ |
(7,770 |
) |
|
$ |
(111,413 |
) |
Interest income |
|
|
5,992 |
|
|
|
2,822 |
|
Interest expense |
|
|
(7,873 |
) |
|
|
(3,870 |
) |
Gain on extinguishment of debt |
|
|
13,136 |
|
|
|
— |
|
Change in fair value of tax receivable liability |
|
|
(14,543 |
) |
|
|
(6,619 |
) |
Other income (loss) |
|
|
138 |
|
|
|
(455 |
) |
Total other income (expense) |
|
|
(3,150 |
) |
|
|
(8,122 |
) |
Income (loss) before income tax benefit (expense) |
|
|
(10,920 |
) |
|
|
(119,535 |
) |
Income tax benefit (expense) |
|
|
575 |
|
|
|
2,115 |
|
Net income (loss) |
|
$ |
(10,345 |
) |
|
$ |
(117,420 |
) |
|
|
|
|
|
|
|
Add: |
|
|
|
|
|
|
Interest income |
|
|
(5,992 |
) |
|
|
(2,822 |
) |
Interest expense |
|
|
7,873 |
|
|
|
3,870 |
|
Depreciation and amortization (a) |
|
|
103,710 |
|
|
|
103,857 |
|
Income tax (benefit) expense |
|
|
(575 |
) |
|
|
(2,115 |
) |
EBITDA |
|
$ |
94,671 |
|
|
$ |
(14,630 |
) |
|
|
|
|
|
|
|
Loss on business disposition (h) |
|
|
— |
|
|
|
10,027 |
|
Gain on extinguishment of debt (i) |
|
|
(13,136 |
) |
|
|
— |
|
Non-cash change in fair value of contingent consideration (j) |
|
|
— |
|
|
|
— |
|
Non-cash impairment loss (b) |
|
|
— |
|
|
|
75,800 |
|
Non-cash change in fair value of assets and liabilities (c) |
|
|
14,543 |
|
|
|
7,494 |
|
Share-based compensation expense (d) |
|
|
25,195 |
|
|
|
22,156 |
|
Transaction expenses (e) |
|
|
2,325 |
|
|
|
8,523 |
|
Restructuring and other strategic initiative costs (f) |
|
|
12,494 |
|
|
|
11,908 |
|
Other non-recurring charges (g) |
|
|
4,718 |
|
|
|
5,528 |
|
Adjusted EBITDA |
|
$ |
140,810 |
|
|
$ |
126,806 |
|
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted Net Income
For the Three Months Ended December 31, 2024 and 2023
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
($ in thousands) |
|
2024 |
|
|
2023 |
|
Revenue |
|
$ |
78,271 |
|
|
$ |
75,987 |
|
Operating expenses |
|
|
|
|
|
|
Costs of services (exclusive of depreciation and amortization shown separately below) |
|
$ |
18,556 |
|
|
$ |
17,261 |
|
Selling, general and administrative |
|
|
36,503 |
|
|
|
36,679 |
|
Depreciation and amortization |
|
|
24,382 |
|
|
|
24,711 |
|
Change in fair value of contingent consideration |
|
|
— |
|
|
|
— |
|
Impairment loss |
|
|
— |
|
|
|
75,750 |
|
Total operating expenses |
|
$ |
79,441 |
|
|
$ |
154,401 |
|
Loss from operations |
|
$ |
(1,170 |
) |
|
$ |
(78,414 |
) |
Interest income |
|
|
1,629 |
|
|
|
1,260 |
|
Interest expense |
|
|
(3,134 |
) |
|
|
(895 |
) |
Change in fair value of tax receivable liability |
|
|
(1,785 |
) |
|
|
(2,903 |
) |
Other income (loss) |
|
|
76 |
|
|
|
(145 |
) |
Total other income (expense) |
|
|
(3,214 |
) |
|
|
(2,683 |
) |
Income (loss) before income tax benefit (expense) |
|
|
(4,384 |
) |
|
|
(81,097 |
) |
Income tax benefit (expense) |
|
|
426 |
|
|
|
3,423 |
|
Net income (loss) |
|
$ |
(3,958 |
) |
|
$ |
(77,674 |
) |
|
|
|
|
|
|
|
Add: |
|
|
|
|
|
|
Amortization of acquisition-related intangibles (k) |
|
|
18,595 |
|
|
|
20,969 |
|
Non-cash impairment loss (b) |
|
|
— |
|
|
|
75,750 |
|
Non-cash change in fair value of assets and liabilities (c) |
|
|
1,785 |
|
|
|
3,778 |
|
Share-based compensation expense (d) |
|
|
5,921 |
|
|
|
5,899 |
|
Transaction expenses (e) |
|
|
297 |
|
|
|
921 |
|
Restructuring and other strategic initiative costs (f) |
|
|
5,524 |
|
|
|
3,372 |
|
Other non-recurring charges (g) |
|
|
1,440 |
|
|
|
520 |
|
Non-cash interest expense (l) |
|
|
845 |
|
|
|
712 |
|
Pro forma taxes at effective rate (m) |
|
|
(8,016 |
) |
|
|
(7,906 |
) |
Adjusted Net Income |
|
$ |
22,433 |
|
|
$ |
26,341 |
|
|
|
|
|
|
|
|
Shares of Class A common stock outstanding (on an as-converted basis) (n) |
|
|
93,946,583 |
|
|
|
97,063,687 |
|
Adjusted Net Income per share |
|
$ |
0.24 |
|
|
$ |
0.27 |
|
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted Net Income
For the Years Ended December 31, 2024 and 2023
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
($ in thousands) |
|
2024 |
|
|
2023 |
|
Revenue |
|
$ |
313,042 |
|
|
$ |
296,627 |
|
Operating expenses |
|
|
|
|
|
|
Costs of services (exclusive of depreciation and amortization shown separately below) |
|
$ |
71,636 |
|
|
$ |
69,703 |
|
Selling, general and administrative |
|
|
145,466 |
|
|
|
148,653 |
|
Depreciation and amortization |
|
|
103,710 |
|
|
|
103,857 |
|
Loss on business disposition |
|
|
— |
|
|
|
10,027 |
|
Impairment loss |
|
|
— |
|
|
|
75,800 |
|
Total operating expenses |
|
$ |
320,812 |
|
|
$ |
408,040 |
|
Loss from operations |
|
$ |
(7,770 |
) |
|
$ |
(111,413 |
) |
Interest income |
|
|
5,992 |
|
|
|
2,822 |
|
Interest expense |
|
|
(7,873 |
) |
|
|
(3,870 |
) |
Gain on extinguishment of debt |
|
|
13,136 |
|
|
|
— |
|
Change in fair value of tax receivable liability |
|
|
(14,543 |
) |
|
|
(6,619 |
) |
Other income (loss) |
|
|
138 |
|
|
|
(455 |
) |
Total other income (expense) |
|
|
(3,150 |
) |
|
|
(8,122 |
) |
Income (loss) before income tax benefit (expense) |
|
|
(10,920 |
) |
|
|
(119,535 |
) |
Income tax benefit (expense) |
|
|
575 |
|
|
|
2,115 |
|
Net income (loss) |
|
$ |
(10,345 |
) |
|
$ |
(117,420 |
) |
|
|
|
|
|
|
|
Add: |
|
|
|
|
|
|
Amortization of acquisition-related intangibles (k) |
|
|
77,144 |
|
|
|
81,642 |
|
Loss on business disposition (h) |
|
|
— |
|
|
|
10,027 |
|
Gain on extinguishment of debt (i) |
|
|
(13,136 |
) |
|
|
— |
|
Non-cash change in fair value of contingent consideration (j) |
|
|
— |
|
|
|
— |
|
Non-cash impairment loss (b) |
|
|
— |
|
|
|
75,800 |
|
Non-cash change in fair value of assets and liabilities (c) |
|
|
14,543 |
|
|
|
7,494 |
|
Share-based compensation expense (d) |
|
|
25,195 |
|
|
|
22,156 |
|
Transaction expenses (e) |
|
|
2,325 |
|
|
|
8,523 |
|
Restructuring and other strategic initiative costs (f) |
|
|
12,494 |
|
|
|
11,908 |
|
Other non-recurring charges (g) |
|
|
4,718 |
|
|
|
5,528 |
|
Non-cash interest expense (l) |
|
|
3,031 |
|
|
|
2,848 |
|
Pro forma taxes at effective rate (m) |
|
|
(28,151 |
) |
|
|
(23,564 |
) |
Adjusted Net Income |
|
$ |
87,818 |
|
|
$ |
84,942 |
|
|
|
|
|
|
|
|
Shares of Class A common stock outstanding (on an as-converted basis) (n) |
|
|
95,678,128 |
|
|
|
96,850,559 |
|
Adjusted Net Income per share |
|
$ |
0.92 |
|
|
$ |
0.88 |
|
Reconciliation of Operating Cash Flow to Free Cash Flow
For the Three Months and Years Ended December 31, 2024 and 2023
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months ended December 31, |
|
|
Year Ended December 31, |
|
($ in thousands) |
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
Net cash provided by operating activities |
|
$ |
34,252 |
|
|
$ |
34,863 |
|
|
$ |
150,090 |
|
|
$ |
103,614 |
|
Capital expenditures |
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for property and equipment |
|
|
(207 |
) |
|
|
(183 |
) |
|
|
(989 |
) |
|
|
(733 |
) |
Capitalized software development costs |
|
|
(10,586 |
) |
|
|
(12,893 |
) |
|
|
(43,864 |
) |
|
|
(50,083 |
) |
Total capital expenditures |
|
|
(10,793 |
) |
|
|
(13,076 |
) |
|
|
(44,853 |
) |
|
|
(50,816 |
) |
Free cash flow |
|
$ |
23,459 |
|
|
$ |
21,787 |
|
|
$ |
105,237 |
|
|
$ |
52,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow conversion |
|
|
64 |
% |
|
|
65 |
% |
|
|
75 |
% |
|
|
42 |
% |
Quarterly Reconciliation of Operating Cash Flow to Free Cash Flow
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months ended |
|
(in $ thousands) |
|
March 31, 2024 |
|
|
June 30, 2024 |
|
|
September 30, 2024 |
|
Net cash provided by operating activities |
|
$ |
24,801 |
|
|
$ |
30,979 |
|
|
$ |
60,058 |
|
Capital expenditures |
|
|
|
|
|
|
|
|
|
Cash paid for property and equipment |
|
|
(87 |
) |
|
|
(484 |
) |
|
|
(211 |
) |
Capitalized software development costs |
|
|
(11,042 |
) |
|
|
(11,207 |
) |
|
|
(11,029 |
) |
Total capital expenditures |
|
|
(11,129 |
) |
|
|
(11,691 |
) |
|
|
(11,240 |
) |
Free cash flow |
|
$ |
13,672 |
|
|
$ |
19,288 |
|
|
$ |
48,818 |
|
|
|
|
|
|
|
|
|
|
|
Free cash flow conversion |
|
|
38 |
% |
|
|
57 |
% |
|
|
139 |
% |
(a)See footnote (k) for details on amortization and depreciation expenses.
(b)For the three months and year ended December 31, 2023, reflects non-cash goodwill impairment loss related to the Business Payments segment. In addition, for the year ended December 31, 2023, reflects non-cash impairment loss related to a trade name write-off of Media Payments.
(c)For the three months and year ended December 31, 2024, reflects the changes in management’s estimates of the fair value of the liability relating to the Tax Receivable Agreement. For the three months and year ended December 31, 2023, reflects the changes in management’s estimates of (i) the fair value of the liability relating to the Tax Receivable Agreement, and (ii) non-cash insurance reserve.
(d)Represents compensation expense associated with equity compensation plans.
(e)Primarily consists of (i) during the three months and year ended December 31, 2024, the three months ended September 30, 2024, the three months ended June 30, 2024 and the three months ended March 31, 2024, professional service fees incurred in connection with prior transactions, and (ii) during the three months and year ended December 31, 2023, professional service fees and other costs incurred in connection with the disposition of Blue Cow Software.
(f)Reflects costs associated with reorganization of operations, consulting fees related to processing services and other operational improvements, including restructuring and integration activities related to acquired businesses, that were not in the ordinary course.
(g)For the three months and year ended December 31, 2024, reflects one-time processing settlements, franchise taxes and other non-income based taxes, non-recurring legal and other litigation expenses and payments made to third-parties in connection with our IT security and personnel. For the three months ended September 30, 2024, the three months ended June 30, 2024 and the three months ended March 31, 2024, reflects franchise taxes and other non-income based taxes, non-recurring legal and other litigation expenses and payments made to third-parties in connection with our IT security and personnel. For the three months and year ended December 31, 2023, reflects payments made to third-parties in connection with an expansion of our personnel, franchise taxes and other non-income based taxes and one-time payments to certain partners.
(h)Reflects the loss recognized related to the disposition of Blue Cow.
(i)Reflects a gain on the repurchase of 2026 Notes principal, net of a write-off of debt issuance costs relating to the repurchased principal.
(j)Reflects the changes in management’s estimates of future cash consideration to be paid in connection with prior acquisitions from the amount estimated as of the most recent balance sheet date.
(k)Reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the business combination with Thunder Bridge, and client relationships, non-compete agreement, and software intangibles acquired through REPAY's acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus, CPS Payments, BillingTree, Kontrol Payables and Payix. This adjustment excludes the amortization of other intangible assets which were acquired in the regular course of business, such as capitalized internally developed software and purchased software. See additional information below for an analysis of amortization expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31, |
|
|
Year ended December 31, |
|
($ in thousands) |
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
Acquisition-related intangibles |
|
$ |
18,595 |
|
|
$ |
20,969 |
|
|
$ |
77,144 |
|
|
$ |
81,642 |
|
Software |
|
|
5,249 |
|
|
|
3,150 |
|
|
|
24,826 |
|
|
|
19,789 |
|
Amortization |
|
$ |
23,844 |
|
|
$ |
24,119 |
|
|
$ |
101,970 |
|
|
$ |
101,431 |
|
Depreciation |
|
|
538 |
|
|
|
592 |
|
|
|
1,740 |
|
|
|
2,426 |
|
Total Depreciation and amortization (1) |
|
$ |
24,382 |
|
|
$ |
24,711 |
|
|
$ |
103,710 |
|
|
$ |
103,857 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months ended |
|
(in $ thousands) |
|
March 31, 2024 |
|
|
June 30, 2024 |
|
|
September 30, 2024 |
|
Acquisition-related intangibles |
|
$ |
19,736 |
|
|
$ |
19,702 |
|
|
$ |
19,111 |
|
Software |
|
|
6,713 |
|
|
|
6,856 |
|
|
|
6,008 |
|
Amortization |
|
$ |
26,449 |
|
|
$ |
26,558 |
|
|
$ |
25,119 |
|
Depreciation |
|
|
579 |
|
|
|
213 |
|
|
|
410 |
|
Total Depreciation and amortization (1) |
|
$ |
27,028 |
|
|
$ |
26,771 |
|
|
$ |
25,529 |
|
(1)Adjusted Net Income is adjusted to exclude amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions (see corresponding adjustments in the reconciliation of net income to Adjusted Net Income presented above). Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although REPAY excludes amortization from acquisition-related
intangibles from its non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Amortization of intangibles that relate to past acquisitions will recur in future periods until such intangibles have been fully amortized. Any future acquisitions may result in the amortization of additional intangibles.
(l)Represents amortization of non-cash deferred debt issuance costs.
(m)Represents pro forma income tax adjustment effect associated with items adjusted above.
(n)Represents the weighted average number of shares of Class A common stock outstanding (on an as-converted basis assuming conversion of outstanding Post-Merger Repay Units) for the three months and years ended December 31, 2024 and 2023. These numbers do not include any shares issuable upon conversion of the Company’s convertible senior notes. See the reconciliation of basic weighted average shares outstanding to the non-GAAP Class A common stock outstanding on an as-converted basis for each respective period below:
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Weighted average shares of Class A common stock outstanding - basic |
|
88,392,571 |
|
91,206,870 |
|
89,915,137 |
|
90,048,638 |
Add: Non-controlling interests
Weighted average Post-Merger Repay Units exchangeable for Class A common stock |
|
5,554,012 |
|
5,856,817 |
|
5,762,991 |
|
6,801,921 |
Shares of Class A common stock outstanding (on an as-converted basis) |
|
93,946,583 |
|
97,063,687 |
|
95,678,128 |
|
96,850,559 |
Q4 2024 Earnings Supplement March 2025 Exhibit 99.2
Disclaimer Repay Holdings Corporation (“REPAY” or the “Company”) is required to file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission (“SEC”) Such filings, which you may obtain for free at the SEC’s website at http://www.sec.gov, discuss some of the important risk factors that may affect REPAY’s business, results of operations and financial condition. On July 11, 2019, Thunder Bridge Acquisition Ltd. (“Thunder Bridge”) and Hawk Parent Holdings LLC (“Hawk Parent”) completed their previously announced business combination under which Thunder Bridge acquired Hawk Parent, upon which Thunder Bridge changed its name to Repay Holdings Corporation. Forward-Looking Statements This presentation (the “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 financial and operating results, REPAY’s plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. These forward-looking statements include, but are not limited to, expected demand on REPAY’s product offering, including further implementation of electronic payment options and statements regarding REPAY’s market and growth opportunities, and REPAY’s business strategy and the plans and objectives of management for future operations. Such forward-looking statements are based upon the current beliefs and expectations of REPAY’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond REPAY’s control. In addition to factors previously disclosed in REPAY’s reports filed with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2024, the following factors, among others, could cause actual results and the timing of events to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: risks or uncertainties relating to the outcome or timing of REPAY’s strategic review process, exposure to economic conditions and political risk affecting the consumer loan market, the receivables management industry and consumer and commercial spending, including bank failures or other adverse events affecting financial institutions, inflationary pressures, general economic slowdown or recession; changes in the payment processing market in which REPAY competes, including with respect to its competitive landscape, technology evolution or regulatory changes; changes in the vertical markets that REPAY targets, including the regulatory environment applicable to REPAY’s clients; the ability to retain, develop and hire key personnel; risks relating to REPAY’s relationships within the payment ecosystem; risk that REPAY may not be able to execute its growth strategies, including identifying and executing acquisitions; risks relating to data security; changes in accounting policies applicable to REPAY; and the risk that REPAY may not be able to maintain effective internal controls. Actual results, performance or achievements may differ materially, and potentially adversely, from any projections and forward-looking statements and the assumptions on which those forward-looking statements are based. There can be no assurance that the data contained herein is reflective of future performance to any degree. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance. All information set forth herein speaks only as of the date hereof in the case of information about REPAY or the date of such information in the case of information from persons other than REPAY, and REPAY disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this Presentation. Forecasts and estimates regarding our industry and end markets are based on sources REPAY believes to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part. Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results. Industry and Market Data The information contained herein also includes information provided by third parties, such as market research firms. Neither of REPAY nor its affiliates and any third parties that provide information to REPAY, such as market research firms, guarantee the accuracy, completeness, timeliness or availability of any information. Neither REPAY nor its affiliates and any third parties that provide information to REPAY, such as market research firms, are responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or the results obtained from the use of such content. Neither REPAY nor its affiliates give any express or implied warranties, including, but not limited to, any warranties of merchantability or fitness for a particular purpose or use, and they expressly disclaim any responsibility or liability for direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees or losses (including lost income or profits and opportunity costs) in connection with the use of the information herein. Non-GAAP Financial Measures This Presentation includes certain non-GAAP financial measures that REPAY’s management uses to evaluate its operating business, measure its performance and make strategic decisions. Adjusted EBITDA is a non-GAAP financial measure that represents net income prior to interest expense, tax expense, depreciation and amortization, as adjusted to add back certain charges deemed to not be part of normal operating expenses, non-cash and/or non-recurring charges, such as loss on business disposition, loss on extinguishment of debt, loss on termination of interest rate hedge, non-cash change in fair value of contingent consideration, non-cash change in fair value of assets and liabilities, share-based compensation charges, transaction expenses, restructuring and other strategic initiative costs and other non-recurring charges. Adjusted EBITDA margin is a non-GAAP financial measure that represents Adjusted EBITDA divided by GAAP revenue. Adjusted Net Income is a non-GAAP financial measure that represents net income prior to amortization of acquisition-related intangibles, as adjusted to add back certain charges deemed to not be part of normal operating expenses, non-cash and/or non-recurring charges, such as loss on business disposition, loss on extinguishment of debt, loss on termination of interest rate hedge, non-cash change in fair value of contingent consideration, non-cash change in fair value of assets and liabilities, share-based compensation expense, transaction expenses, restructuring and strategic initiative costs and other non-recurring charges, non-cash interest expense, net of tax effect associated with these adjustments. Adjusted Net Income is adjusted to exclude amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions. Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although management excludes amortization from acquisition-related intangibles from REPAY’s non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Each of “organic revenue growth,” and “organic gross profit (GP) growth” is a non-GAAP financial measure that represents the percentage change in the applicable metric for a fiscal period over the comparable prior fiscal period, exclusive of any incremental amount attributable to acquisitions or divestitures made in the comparable prior fiscal period or any subsequent fiscal period through the applicable current fiscal period. Any financial measure (whether GAAP or non-GAAP) that is modified by “excl. political media” is a non-GAAP financial measure that measures a defined growth rate exclusive of the estimated contribution from political media clients in the prior corresponding period. Free Cash Flow is a non-GAAP financial measure that represents net cash flow provided by operating activities less total capital expenditures. Free Cash Flow Conversion represents Free Cash Flow divided by Adjusted EBITDA. REPAY believes that each of the non-GAAP financial measures referenced in this paragraph provide useful information to investors and others in understanding and evaluating its operating results in the same manner as management. However, these non-GAAP financial measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating profit, or any other operating performance measure calculated in accordance with GAAP. Using these non-GAAP financial measures to analyze REPAY’s business has material limitations because the calculations are based on the subjective determination of management regarding the nature and classification of events and circumstances that investors may find significant. In addition, although other companies in REPAY’s industry may report measures titled with the same or similar description, such non-GAAP financial measures may be calculated differently from how REPAY calculates its non-GAAP financial measures, which reduces their overall usefulness as comparative measures. Because of these limitations, you should consider each of the non-GAAP financial measures referenced in this paragraph alongside other financial performance measures, including net income and REPAY’s other financial results presented in accordance with GAAP.
1 Financial Update
We closed out the year with another quarter of profitable growth, with a focus on accelerated FCF conversion in 2024 We will continue to take advantage of the many secular trends towards frictionless digital payments that have been, and will continue to be, a tailwind driving our business
FY 2024 Financial Highlights REVENUE $313.0MM +6% y/y growth GROSS PROFIT FREE CASH FLOW(2) REPAY’s Unique Model Translates Into a Highly Attractive Financial Profile $241.4MM +6% y/y growth ADJUSTED EBITDA(1) $140.8MM +11% y/y growth $105.2MM 75% FCF Conversion(2) Adjusted EBITDA is a non-GAAP financial measures. See slide 1 under “Non-GAAP Financial Measures” and slide 21 for reconciliation. Free Cash Flow and Free Cash Flow conversion are non-GAAP financial measures. See slide 1 under “Non-GAAP Financial Measures” and slide 23 for reconciliation. Free Cash Flow conversion represents Free Cash Flow / Adjusted EBITDA
Financial Update – Q4 2024 ($MM) Revenue Gross Profit Adjusted EBITDA (2) Gross profit margin represents gross profit / revenue Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. See slide 1 under “Non-GAAP Financial Measures” and slide 21 for reconciliation. Adjusted EBITDA margin represents adjusted EBITDA / revenue Free Cash Flow and Free Cash Flow conversion are non-GAAP financial measures. See slide 1 under “Non-GAAP Financial Measures” and slide 23 for reconciliation. Free Cash Flow conversion represents Free Cash Flow / Adjusted EBITDA 77% 76% % Margin (1) 44% 47% % Margin (2) 2% y/y growth 3% y/y growth 9% y/y growth Free Cash Flow (3) 65% 64% FCF conversion (3) 8% y/y growth
Strong Profitability and Accelerating FCF Conversion Q4 2024 FY 2024 Adjusted EBITDA y/y growth (1) 9% 11% Capital expenditures y/y growth (2) (17%) (12%) Free Cash Flow y/y growth (3) 8% 99% Adjusted EBITDA is a non-GAAP financial measure. Adjusted EBITDA growth represents percentage change in this non-GAAP financial measure for a fiscal period over the comparable prior fiscal period, with no other adjustments. See slide 1 under “Non-GAAP Financial Measures” and slide 21 for reconciliation Capital expenditures represents total capital expenditures. See slide 23 for financial disclosure Free Cash Flow and Free Cash Flow Conversion are non-GAAP financial measures. Free Cash Flow growth represents percentage change in this non-GAAP financial measure for a fiscal period over the comparable prior fiscal period, with no other adjustments. See slide 1 under “Non-GAAP Financial Measures” and slide 23 for reconciliations. Free Cash Flow Conversion represents Free Cash Flow / Adjusted EBITDA Free Cash Flow Conversion (3) FY 2024 Free Cash Flow benefited from ~$25 million favorable timing related to net working capital ~$20 million benefit during Q3 2024 ~$5 million benefit during Q4 2024 ~$20 million is expected to reverse during Q1 2025
Consumer Payments Results – FY 2024 ($MM) Key Business Highlights Resilent trends across auto loans, personal loans, credit unions, and mortgage servicing, while seeing pockets of consumer softness Winning large enterprise clients who are adopting more payment channels and modalities Continued strong adoption of non-card volume-based products Executing on integration refreshes to further penetrate software partnerships, which leads to confidence in our sales pipeline GP margins benefited from processing costs optimization and strategic initiatives Growth impact from client losses was ~5% in Q4 and ~2% for FY 2024 Gross Profit Margin 78% 79% 2% y/y growth 3% y/y growth
Strong sales pipeline within healthcare, property management, and municipality verticals via direct sales and new / refreshed integrations Benefiting from strong political media contributions Increased our AP Supplier Network to 360,000+ suppliers GP margins benefited from political media contributions, processing costs optimization, and automation initiatives Growth partially offset by: Client loss impact of ~17% in Q4 and ~3% for FY 2024 TotalPay volume migration of ~6% in Q4 and ~2% for FY 2024 Business Payments Results – FY 2024 ($MM) Key Business Highlights Gross Profit Margin 73% 74% 39% y/y growth 40% y/y growth
Balance Sheet Flexibility and Net Leverage Total liquidity represents cash balance plus the undrawn revolver facility as of 12/31/2023 and 12/31/2024 Management estimated total liquidity for 2025E expected to be in excess of near-term debt maturity Adjusted EBITDA is a non-GAAP financial measure. See slide 1 under “Non-GAAP Financial Measures.” LTM Adjusted EBITDA represents the sum of the Adjusted EBITDA for the four most recent fiscal quarters. See slide 10 for such amounts and additional reconciliation information contained in footnote 2 of Slide 10 Liquidity & Near-Term Debt Maturity Focused on Maintaining Significant Liquidity Business focused on high cash flow conversion and further improvements Continued investments in organic growth Preserve liquidity and profitability through: Hiring focused on revenue generating / supporting roles Limited discretionary expenses Negotiations with vendors Accelerated FCF conversion On-going cash generation & continued improvements in FCF conversion (1) (In $ millions) (2) Net Leverage as of December 31, 2024 Total Debt $508 MM Cash Balance $190 MM Net Debt $318 MM LTM Adjusted EBITDA (3) $141 MM Net Leverage 2.3x Committed to Prudently Managing Leverage Total Outstanding Debt comprised of: $220 million 2026 Convertible Notes with 0% coupon Newly issued $288 million 2029 Convertible Notes with 2.875% coupon $250 million revolver facility provides flexibility for debt maturities and further acquisitions (upsized on July 10, 2024) Secured net leverage covenant is max of 2.5x (definitionally excludes convertible notes balance) (1)
History of Sustained Growth Across All Key Metrics… Gross Profit (1) Revenue (1) Free Cash Flow (2) Adjusted EBITDA(2) (In $ Millions) (In $ Millions) (In $ Millions) (In $ Millions) 14% CAGR 44% CAGR (3) Consumer Payments Business Payments Consolidated Consolidated totals include the elimination of intersegment revenues Adjusted EBITDA and Free Cash Flow are non-GAAP financial measures. See slide 1 under “Non-GAAP Financial Measures” and slides 21 & 23 for reconciliations. For historical periods shown with respect to Adjusted EBITDA, see the reconciliations provided in the Company’s previous reported earnings releases and filings on Form 10-K or Form 10-Q with respect to such period ended. CAGR is from Q2 2021 to Q4 2024 15% CAGR 17% CAGR
…With Expanding Gross Profit Margins and Accelerating FCF Conversion FCF Conversion (1) Gross Profit Margin Free Cash Flow Conversion represents Free Cash Flow / Adjusted EBITDA. Free Cash Flow Conversion is non-GAAP financial measure. See slide 1 under “Non-GAAP Financial Measures” and slide 23 for reconciliation
2 Strategy & Business Updates
Acquire New Clients in Existing Verticals With Our 2024 Performance We See Multiple Levers to Continue to Drive Growth FY 2024 GP Growth 6% EXECUTE ON EXISTING BUSINESS BROADENING ADDRESSABLE MARKET AND SOLUTIONS REPAY’s leading platform & attractive market opportunity position it to build on its record of robust growth & profitability Expand New and Existing Software Partnerships Expand Usage and Increase Adoption Strategic M&A Additional Value-Added Service Opportunities Majority of Consumer Payments growth from further penetration of existing client base Majority of Business Payments growth from acquiring new clients Operational Efficiencies New Vertical Expansion
ADDED NEW CLIENTS VIA DIRECT SALESFORCE ACROSS ALL VERTICALS 280 SOFTWARE PARTNER RELATIONSHIPS(1), INCLUDING: As of 12/31/2024 Third-party research and management estimates as of 12/31/2024 Total liquidity represents cash balance as of 12/31/2024 plus undrawn $250 million revolver facility. See slide 9 for further information Executing on Growth Plan BROADEN ADDRESSABLE MARKET AND SOLUTIONS ERP & accounting software integrations provide vertical agnostic opportunities Expanded TAM to ~$5.6 trillion(2) through strategic M&A Continuing to grow existing relationships and add new opportunities within existing verticals & ISVs Cash on balance sheet and revolving credit facility gives the Company ample liquidity of $440 million(3) to pursue our capital allocation initiatives such as investing in organic growth, balancing reduction of net leverage, while managing our convertible debt liability, and potentially pursuing M&A Continuing to thoughtfully invest in new product and research & development capabilities EXPANDING EXISTING BUSINESS CONSUMER PAYMENTS BUSINESS PAYMENTS Ended Q4 2024 with 329 credit union clients VISA ACCEPTANCE FASTRACK PROGRAM
Ample Runway in Consumer Payments Third-party research and management estimates as of 12/31/2024 Evolving consumer preferences and technology are requiring clients to embrace payment digitization TOTAL ADDRESSABLE MARKET(1) $2.4Tn VERTICAL END MARKETS 6 ISV INTEGRATION PARTNERS 180 REPAY’s integrated payment processing platform automates and modernizes our clients' operations, resulting in increased cash flow, lower costs, and improved customer experience Loan repayments expertise is core to our efficiency: from tokenization to our clearing & settlement engine Instant Funding accelerates the time at which borrowers receive loans while increasing digital repayments Multipronged go-to-market approach leverages both direct and indirect sales Continuing to invest into deeper ISV integrations, product innovation, and vertical specific technologies
Consumer Payments Offering Omnichannel Capabilities across Modalities Clients in REPAY’s verticals look to partner with innovative vendors that can provide evolving payment functionality and acceptance solutions Credit and Debit Card Processing ACH Processing Instant Funding eCash New & Emerging Payments Virtual Terminal IVR / Phone Pay Mobile Application Web Portal / Online Bill Pay Hosted Payment Page POS Equipment Text Pay PAYMENT MODALITIES PAYMENT CHANNELS REPRESENTATIVE CLIENTS
REPAY’s Growing Business Payments Segment Third-party research and management estimates as of 12/31/2024 $1.5Tn total addressable market Integrations with leading ERP platforms, serving a highly diversified client base across a wide range of industry verticals Expanded into B2B vertical via APS acquisition Cross sell initiative happening within Sage and Acumatica ERPs to add AP solutions TOTAL ADDRESSABLE MARKET(1) $3.2Tn VERTICAL END MARKETS 15+ SUPPLIER NETWORK 360,000+ B2B INTEGRATED SOFTWARE PARTNERS 100 Combined AR and AP automation solution provides a compelling value proposition to clients $1.7Tn total addressable market Fully integrated AP automation platform with electronic payment capabilities including virtual cards and ACH Expanded into AP automation vertical via cPayPlus, CPS, and Kontrol acquisitions Entered the B2B healthcare space through Ventanex acquisition B2B Merchant Acquiring B2B AP Automation
Powerful Business Payments Offering One-stop-shop B2B payments solutions provider REPRESENTATIVE CLIENTS Automated Reporting and Reconciliation Multiple Payment Options Including Virtual Card and Cross Border Vendor Management Client Rebates Deep ERP Integrations Multiple Payment Methods Tracking and Reconciliation Highly Secure ACCOUNTS RECEIVABLE AUTOMATION ACCOUNTS PAYABLE AUTOMATION TotalPay Solution Cash Inflow Cash Outflow Buyers Suppliers
3 Appendix
Q4 2024 Financial Update Note: Not meaningful (NM) for comparison Operating expenses includes SG&A and expenses associated with non-cash impairment loss, the change in fair value of tax receivable liability, change in fair value of contingent consideration, loss on extinguishment of debt, and other income / expenses See “Adjusted EBITDA Reconciliation” on slide 21 for reconciliation of Adjusted EBITDA to its most comparable GAAP measure See “Adjusted Net Income Reconciliation” on slide 22 for reconciliation of Adjusted Net Income to its most comparable GAAP measure See “Free Cash Flow Reconciliation” on slide 23 for reconciliation of Free Cash Flow to its most comparable GAAP measure THREE MONTHS ENDED DECEMBER 31 CHANGE $MM 2024 2023 AMOUNT % Revenue $79.1 $74.3 $4.8 6% Costs of Services 17.6 17.6 (0.1) (0%) Gross Profit $61.6 $56.7 $4.9 9% Operating Expenses(1) 40.1 113.4 (73.4) (65%) EBITDA $21.5 ($56.8) $78.3 138% Depreciation and Amortization 24.4 24.7 (0.3) (1%) Interest (Income) (1.6) (1.3) (0.4) 29% Interest Expense 3.1 0.9 2.2 250% Income Tax Expense (Benefit) (0.4) (3.4) 3.0 NM Net Income (Loss) ($4.0) ($77.7) $73.7 95% Adjusted EBITDA(2) $36.5 $33.5 $3.0 9% Adjusted Net Income(3) $22.4 $26.3 ($3.9) (15%) Free Cash Flow(4) $23.5 $21.8 $1.7 8%
Q4 & FY Adjusted EBITDA Reconciliation Reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the business combination with Thunder Bridge, and client relationships, non-compete agreement, and software intangibles acquired through REPAY's acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus, CPS Payments, BillingTree, Kontrol Payables and Payix. This adjustment excludes the amortization of other intangible assets which were acquired in the regular course of business, such as capitalized internally developed software and purchased software. Reflects the loss recognized related to the disposition of Blue Cow. For the three months ended December 31, 2023, reflects non-cash goodwill impairment loss related to the Business Payments segment. In addition, for the year ended December 31, 2023, reflects non-cash impairment loss related to a trade name write-off of Media Payments. Reflects a gain on the repurchase of 2026 Notes principal, net of a write-off of debt issuance costs relating to the repurchased principal. For the three months and year ended December 31, 2024, reflects the changes in management’s estimates of the fair value of the liability relating to the Tax Receivable Agreement. For the three months and year ended December 31, 2023, reflects the changes in management’s estimates of (i) the fair value of the liability relating to the Tax Receivable Agreement, and (ii) non-cash insurance reserve. Represents compensation expense associated with equity compensation plans. Primarily consists of (i) during the three months and year ended December 31, 2024, professional service fees incurred in connection with prior transactions, and (ii) during the three months and year ended December 31, 2023, professional service fees and other costs incurred in connection with the disposition of Blue Cow Software. Reflects costs associated with reorganization of operations, consulting fees related to processing services and other operational improvements, including restructuring and integration activities related to acquired businesses, that were not in the ordinary course. For the three months and year ended December 31, 2024, reflects one-time processing settlements, franchise taxes and other non-income based taxes, non-recurring legal and other litigation expenses and payments made to third-parties in connection with our IT security and personnel. For the three months and year ended December 31, 2023, reflects payments made to third-parties in connection with an expansion of our personnel, franchise taxes and other non-income based taxes and one-time payments to certain partners. $MM Q4 2024 Q4 2023 FY 2024 FY 2023 Net Income (Loss) ($4.0) ($77.7) ($10.3) ($117.4) Interest (Income) (1.6) (1.3) (6.0) (2.8) Interest Expense 3.1 0.9 7.9 3.9 Depreciation and Amortization(1) 24.4 24.7 103.7 103.9 Income Tax Expense (Benefit) (0.4) (3.4) (0.6) (2.1) EBITDA $21.5 ($56.8) $94.7 ($14.6) Loss on business disposition(2) – – – 10.0 Non-cash impairment loss (3) – 75.8 – 75.8 Gain on extinguishment of debt(4) – – (13.1) – Non-cash change in fair value of assets and liabilities(5) 1.8 3.8 14.5 7.5 Share-based compensation expense(6) 5.9 5.9 25.2 22.2 Transaction expenses(7) 0.3 0.9 2.3 8.5 Restructuring and other strategic initiative costs(8) 5.5 3.4 12.5 11.9 Other non-recurring charges(9) 1.4 0.5 4.7 5.5 Adjusted EBITDA $36.5 $33.5 $140.8 $126.8
Quarterly Adjusted Net Income Reconciliation Reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the business combination with Thunder Bridge, and client relationships, non-compete agreement, and software intangibles acquired through REPAY's acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus, CPS Payments, BillingTree, Kontrol Payables and Payix. This adjustment excludes the amortization of other intangible assets which were acquired in the regular course of business, such as capitalized internally developed software and purchased software. Reflects non-cash goodwill impairment loss related to the Business Payments segment. For the three months ended December 31, 2024, reflects the changes in management’s estimates of the fair value of the liability relating to the Tax Receivable Agreement. For the three months ended December 31, 2023, reflects the changes in management’s estimates of (i) the fair value of the liability relating to the Tax Receivable Agreement, and (ii) non-cash insurance reserve. Represents compensation expense associated with equity compensation plans. Primarily consists of (i) during the three months ended December 31, 2024, professional service fees incurred in connection with prior transactions, and (ii) during the three months ended December 31, 2023, professional service fees and other costs incurred in connection with the disposition of Blue Cow Software. Reflects costs associated with reorganization of operations, consulting fees related to processing services and other operational improvements, including restructuring and integration activities related to acquired businesses, that were not in the ordinary course. For the three months ended December 31, 2024, reflects a one-time customer processing settlement, franchise taxes and other non-income based taxes, non-recurring legal and other litigation expenses and payments made to third-parties in connection with our IT security and personnel. For the three months ended December 31, 2023, reflects payments made to third-parties in connection with an expansion of our personnel, franchise taxes and other non-income based taxes and one-time payments to certain partners. Represents amortization of non-cash deferred debt issuance costs. Represents pro forma income tax adjustment effect associated with items adjusted above. ($MM) Q4 2024 Q4 2023 Net Income (Loss) ($4.0) ($77.7) Amortization of acquisition-related intangibles(1) 18.6 21.0 Non-cash impairment loss (2) – 75.8 Non-cash change in fair value of assets and liabilities(3) 1.8 3.8 Share-based compensation expense(4) 5.9 5.9 Transaction expenses(5) 0.3 0.9 Restructuring and other strategic initiative costs(6) 5.5 3.4 Other non-recurring charges(7) 1.4 0.5 Non-cash interest expense(8) 0.8 0.7 Pro forma taxes at effective rate(9) (8.0) (7.9) Adjusted Net Income $22.4 $26.3
Free Cash Flow Reconciliation 2021 2022 2023 2024 Full Year $MM Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2021 2022 2023 2024 Net Cash provided by Operating Activities $4.8 $12.1 $14.6 $21.8 $13.8 $13.3 $25.3 $21.8 $20.8 $20.0 $28.0 $34.9 $24.8 $31.0 $60.1 $34.3 $53.3 $74.2 $103.6 $150.1 Capital expenditures Cash paid for property and equipment (0.6) (0.3) (0.9) (0.9) (0.6) (1.3) (0.8) (0.6) (0.5) 0.4 (0.9) (0.2) (0.1) (0.5) (0.2) (0.2) (2.9) (3.2) (0.7) (1.0) Cash paid for capitalized software development costs (1) (4.6) (5.2) (5.2) (5.7) (7.0) (5.1) (8.7) (7.4) (13.2) (10.4) (13.1) (12.9) (11.0) (11.2) (11.0) (10.6) (20.6) (33.6) (50.1) (43.9) Total capital expenditures (5.2) (5.5) (6.1) (6.7) (7.6) (6.3) (9.5) (7.9) (13.7) (10.0) (14.0) (13.1) (11.1) (11.7) (11.2) (10.8) (23.5) (36.8) (50.8) (44.9) Free Cash Flow ($0.4) $6.6 $8.5 $15.2 $6.2 $7.0 $15.9 $13.9 $7.1 $10.0 $13.9 $21.8 $13.7 $19.3 $48.8 $23.5 $29.8 $37.4 $52.8 $105.2 Adjusted EBITDA $20.5 $20.4 $24.5 $27.8 $29.3 $27.6 $31.7 $35.9 $30.9 $30.3 $31.9 $33.5 $35.5 $33.7 $35.1 $36.5 $93.2 $124.5 $126.8 $140.8 Free Cash Flow Conversion(2) (2%) 32% 35% 54% 21% 25% 50% 39% 23% 33% 44% 65% 38% 57% 139% 64% 32% 30% 42% 75% Historical periods beginning Q3 2023 reflect cash paid for intangibles assets that exclude acquisition costs that are capitalized as channel relationships Represents Free Cash Flow / Adjusted EBITDA
Depreciation and Amortization Detail Note Adjusted Net Income is adjusted to exclude amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions (see corresponding adjustments in the reconciliation of net income to Adjusted Net Income presented above). Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although REPAY excludes amortization from acquisition-related intangibles from its non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Amortization of intangibles that relate to past acquisitions will recur in future periods until such intangibles have been fully amortized. Any future acquisitions may result in the amortization of additional intangibles $MM Q4 2024 Q4 2023 Acquisition-related intangibles $18.6 $21.0 Software 5.2 3.2 Amortization $23.8 $24.1 Depreciation 0.5 0.6 Total Depreciation and Amortization $24.4 $24.7
Q4 2024 Revenue and Gross Profit Growth Reconciliations Q4 2024 $MM Consumer Payments Business Payments Total Company Revenue Growth (7%) 76% 3% Acquisitions / (Divestitures) impact n/a n/a n/a Organic Revenue Growth (7%) 76% 3% Political Media contribution / (impact) n/a 69% 9% Organic Revenue Growth, excl. political media (7%) 7% (6%) Q4 2024 $MM Consumer Payments Business Payments Total Company Gross Profit Growth (5%) 60% 2% Acquisitions / (Divestitures) impact n/a n/a n/a Organic Gross Profit Growth (5%) 60% 2% Political Media contribution / (impact) n/a 82% 11% Organic GP Growth, excl. political media (5%) (22%) (9%)
FY2024 Revenue and Gross Profit Growth Reconciliations FY 2024 $MM Consumer Payments Business Payments Total Company Revenue Growth 2% 39% 6% Acquisitions / (Divestitures) impact (<1%) n/a (<1%) Organic Revenue Growth 2% 39% 6% Political Media contribution / (impact) n/a 35% 5% Organic Revenue Growth, excl. political media 2% 4% 1% FY 2024 $MM Consumer Payments Business Payments Total Company Gross Profit Growth 3% 40% 6% Acquisitions / (Divestitures) impact (<1%) n/a (<1%) Organic Gross Profit Growth 4% 40% 7% Political Media contribution / (impact) n/a 42% 5% Organic GP Growth, excl. political media 4% (2%) 2%
Gross Profit Growth Reconciliation 2023 2024 $MM Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Gross Profit Growth 11% 8% 3% 2% 6% 9% 7% 9% 2% 6% Acquisitions / (Divestitures) impact (2%) (4%) (6%) (6%) (4%) (2%) n/a n/a n/a (1%) Organic Gross Profit Growth 13% 12% 9% 8% 10% 11% 7% 9% 2% 7% Political Media contribution / (impact) (<1%) (2%) (3%) (5%) (3%) 1% 2% 8% 11% 5% Organic GP Growth excl. political media 13% 14% 12% 13% 13% 10% 5% 1% (9%) 2%
Historical Segment Details Note: Historical periods reflect the reclassification of revenue and gross profit between Consumer Payments and Business Payments segments 2022 2023 2024 Full Year $MM Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2022 2023 2024 Consumer Payments $61.1 $59.8 $63.0 $64.3 $69.9 $65.9 $68.7 $71.1 $76.1 $69.3 $69.2 $66.3 $248.2 $275.7 $281.0 Business Payments 8.9 9.9 11.4 12.3 8.7 9.8 9.7 9.9 9.7 10.6 15.3 17.4 42.6 38.1 52.9 Intercompany eliminations (2.4) (2.3) (2.9) (4.0) (4.1) (4.0) (4.1) (5.0) (5.1) (5.0) (5.3) (5.4) (11.6) (17.1) (20.8) Revenue $67.6 $67.4 $71.6 $72.7 $74.5 $71.8 $74.3 $76.0 $80.7 $74.9 $79.1 $78.3 $279.2 $296.6 $313.0 Consumer Payments $47.5 $46.1 $49.7 $53.1 $54.6 $51.7 $53.6 $56.2 $59.6 $55.5 $54.9 $53.1 $195.5 $216.1 $223.1 Business Payments 5.9 7.0 8.1 8.6 6.0 7.2 7.2 7.5 7.0 8.0 12.0 12.1 30.4 28.0 39.1 Intercompany eliminations (2.4) (2.3) (2.9) (4.0) (4.1) (4.0) (4.1) (5.0) (5.1) (5.0) (5.3) (5.4) (11.6) (17.1) (20.8) Gross Profit $51.0 $50.7 $54.9 $57.8 $56.6 $54.9 $56.7 $58.7 $61.5 $58.6 $61.6 $59.7 $214.4 $226.9 $241.4 Consumer Payments 77.8% 77.0% 79.0% 82.6% 78.1% 78.4% 78.0% 79.0% 78.3% 80.2% 79.3% 80.0% 78.8% 78.4% 79.4% Business Payments 66.5% 70.0% 70.4% 70.1% 69.5% 73.3% 74.1% 76.6% 72.8% 75.7% 78.5% 69.5% 71.4% 73.5% 74.0% Gross Profit Margin 75.5% 75.2% 76.8% 79.5% 75.9% 76.5% 76.3% 77.3% 76.2% 78.2% 77.8% 76.3% 76.8% 76.5% 77.1%
Investor Presentation Exhibit 99.3 March 2025
Disclaimer On July 11, 2019 (the “Closing Date”), Thunder Bridge Acquisition Ltd. (“Thunder Bridge”) and Hawk Parent Holdings LLC (“Hawk Parent”) completed a business combination (the “Business Combination”) under which Thunder Bridge acquired Hawk Parent, upon which Thunder Bridge changed its name to Repay Holdings Corporation (“REPAY” or the “Company”). The Company’s filings with the Securities and Exchange Commission (“SEC”), which you may obtain for free at the SEC’s website at http://www.sec.gov, discuss some of the important risk factors that may affect REPAY’s business, results of operations and financial condition. Forward-Looking Statements This presentation (the “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 financial and operating results, REPAY’s plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. These forward-looking statements include, but are not limited to, expected demand on REPAY’s product offering, including further implementation of electronic payment options and statements regarding REPAY’s market and growth opportunities, and our business strategy and the plans and objectives of management for future operations. Such forward-looking statements are based upon the current beliefs and expectations of REPAY’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond our control. In addition to factors previously disclosed in REPAY’s reports filed with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2024, the following factors, among others, could cause actual results and the timing of events to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: risks or uncertainties relating to the outcome or timing of REPAY’s strategic review process, exposure to economic conditions and political risk affecting the consumer loan market, the receivables management industry and consumer and commercial spending, including bank failures or other adverse events affecting financial institutions, inflationary pressures, general economic slowdown or recession; changes in the payment processing market in which REPAY competes, including with respect to its competitive landscape, technology evolution or regulatory changes; changes in the vertical markets that REPAY targets, including the regulatory environment applicable to REPAY’s clients; the ability to retain, develop and hire key personnel; risks relating to REPAY’s relationships within the payment ecosystem; risk that REPAY may not be able to execute its growth strategies, including identifying and executing acquisitions; risks relating to data security; changes in accounting policies applicable to REPAY; and the risk that REPAY may not be able to maintain effective internal controls. Actual results, performance or achievements may differ materially, and potentially adversely, from any projections and forward-looking statements and the assumptions on which those forward-looking statements are based. There can be no assurance that the data contained herein is reflective of future performance to any degree. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance. All information set forth herein speaks only as of the date hereof in the case of information about us or the date of such information in the case of information from persons other than us, and we disclaim any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this communication. Forecasts and estimates regarding our industry and end markets are based on sources we believe to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part. Projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results. Industry and Market Data The information contained herein also includes information provided by third parties, such as market research firms. Neither of REPAY nor its affiliates and any third parties that provide information to REPAY, such as market research firms, guarantee the accuracy, completeness, timeliness or availability of any information. Neither REPAY nor its affiliates and any third parties that provide information to REPAY, such as market research firms, are responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or the results obtained from the use of such content. Neither REPAY nor its affiliates give any express or implied warranties, including, but not limited to, any warranties of merchantability or fitness for a particular purpose or use, and they expressly disclaim any responsibility or liability for direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees or losses (including lost income or profits and opportunity costs) in connection with the use of the information herein. Non-GAAP Financial Measures This Presentation includes certain non-GAAP financial measures that REPAY’s management uses to evaluate its operating business, measure its performance and make strategic decisions. Adjusted EBITDA is a non-GAAP financial measure that represents net income prior to interest expense, tax expense, depreciation and amortization, as adjusted to add back certain charges deemed not to be part of normal operating expenses, non-cash and/or non-recurring charges, such as loss on extinguishment of debt, loss on termination of interest rate hedge, non-cash change in fair value of contingent consideration, non-cash change in fair value of assets and liabilities, non-cash change in fair value of warrant liabilities; share-based compensation charges, transaction expenses, restructuring and other strategic initiative costs and other non-recurring charges. Free Cash Flow is a non-GAAP financial measure that represents net cash flow provided by operating activities less total capital expenditures. Free Cash Flow Conversion represents Free Cash Flow divided by Adjusted EBITDA. REPAY believes that each of the non-GAAP financial measures referenced in this paragraph provide useful information to investors and others in understanding and evaluating its operating results in the same manner as management. However, these non-GAAP financial measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating profit, or any other operating performance measure calculated in accordance with GAAP. Using these non-GAAP financial measures to analyze REPAY’s business has material limitations because the calculations are based on the subjective determination of management regarding the nature and classification of events and circumstances that investors may find significant. In addition, although other companies in REPAY’s industry may report measures titled with the same or similar descriptions, such non-GAAP financial measures may be calculated differently from how REPAY calculates its non-GAAP financial measures, which reduces their overall usefulness as comparative measures. Because of these limitations, you should consider each of the non-GAAP financial measures referenced in this paragraph alongside other financial performance measures, including net income and REPAY’s other financial results presented in accordance with GAAP.
2 Agenda Introduction to REPAY REPAY Investment Highlights REPAY Financial Overview 1 2 3
1 Introduction to REPAY
REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs
AUTO FINANCE PERSONAL FINANCE AR AUTOMATION CREDIT UNIONS HEALTHCARE MORTGAGE ARM AP AUTOMATION Your Industry. Our Expertise. CONSUMER PAYMENTS BUSINESS PAYMENTS
Who We Are A leading, highly-integrated omnichannel payment technology platform modernizing Consumer and Business Payments CAGR is from 2021A–2024A As of 12/31/2024 Free Cash Flow Conversion calculated as 2024A Free Cash Flow / 2024A Adjusted EBITDA. These are non-GAAP measures. See slide 1 for definitions and slides 30 and 31 for additional details HISTORICAL REVENUE CAGR(1) HISTORICAL GROSS PROFIT CAGR(1) SOFTWARE INTEGRATIONS(2) 13% 14% 280 75% FREE CASH FLOW CONVERSION(3)
LONG-TERM GROWTH ORGANIC GROWTH M&A CATALYSTS Deepen presence in existing verticals (e.g. Automotive, B2B, Credit Unions, Revenue Cycle Management, Healthcare) Expand into new verticals/geographies Transformational acquisitions extending broader solution suite Driving Shareholder Value 1) Third-party research and management estimates as of 12/31/2024 Secular trends away from cash and check toward digital payments Transaction growth in key verticals Further penetrate existing clients ~$5.6Tn TAM(1) Creates long runway for growth Deep presence in key verticals creates significant defensibility Highly attractive financial model = +
Our Strong Execution and Momentum TOTAL ADDRESSABLE MARKET ~$535Bn ~$5.6Tn(3) SUPPLIER NETWORK _ 360,000+ # OF ISV INTEGRATIONS 53 280 Delivering Superior Results (4) Fourth Quarter 2024(2) July 2019(1) REVENUE CAGR GROSS PROFIT CAGR ADJ. EBITDA CAGR +13% +14% As of 7/11/2019 (the closing date of the Business Combination) As of 12/31/2024 Third-party research and management estimates Represents CAGR from 2021A-2024A. See slide 30 for Adjusted EBITDA reconciliation and slide 31 for Free Cash Flow reconciliation +15% FREE CASH FLOW CAGR +52%
Driving Value for Shareholders Fast growing, large and underpenetrated market opportunity Deep presence in key verticals drives competitive moat Highly strategic and diverse client base Multiple avenues for long term, durable growth Experienced Board and Management team Highly attractive and profitable financial model Accelerating cash flow generation Strong balance sheet Investment Rationale
2 REPAY Investment Highlights
1 A leading, omnichannel payment technology provider Fast growing and underpenetrated market opportunity Vertically integrated payment technology platform driving frictionless payments experience Experienced board with deep payments expertise Multiple avenues for long-term growth Highly strategic and diverse client base 2 3 4 5 6 Key software integrations enabling unique distribution model Business Strengths and Strategies
1 We are Capitalizing on Large, Underserved Market Opportunities REPAY’s existing verticals represent ~$5.6Tn(1) of projected annual total payment volume END MARKET OPPORTUNITIES ($ in Bn) 1) Third-party research and management estimates as of 12/31/2024 Business Payments Consumer Payments $5.6tn TAM(1) Despite growing annual payment volume, REPAY still serves <1% of total payment TAM REPAY’s Total Payment Volume (1)
1 Key end markets have been underserved by payment technology and service providers Credit cards are not permitted in loan repayment which has resulted in overall low card penetration CLIENTS SERVING REPAY’S MARKETS ARE FACING INCREASING DEMAND FROM CUSTOMERS They want electronic and omnichannel payment solutions LOAN REPAYMENT, B2B, AND HEALTHCARE MARKETS Lagged behind other industry verticals in moving to electronic payments CONSUMER PAYMENTS BUSINESS PAYMENTS B2B payments have traditionally been made via check or ACH (including AP and AR) Shift towards high deductible health plans resulting in growing proportion of consumer payments
Card and Debit Payments Underpenetrated in Our Verticals The Nilson Report. Represents debit and credit as a percentage of all U.S. consumer payment systems, including various forms of paper, card, and electronic payment methods Third-party research and management estimates. Personal Loans and Mortgage verticals represent debit card only. Across REPAY’s Verticals(2) Card Payment Penetration Across Industries(1) 1 <
REPAY Has Built a Leading Next-Gen Software Platform Proprietary, integrated payment technology platform reduces complexity for a unified commerce experience Pay Anywhere, Any Way, Any Time Businesses and Consumers Clients 2
REPAY Has Built a Leading Next-Gen Software Platform Value Proposition to REPAY’s Clients Accelerated payment cycle (ability to lend more / faster) through card processing Faster access to funds to help businesses with working capital 24 / 7 payment acceptance through “always open” omnichannel offering Direct software integrations into loan, dealer, and business management systems reduces operational complexity for client Improved regulatory compliance through fewer ACH returns 2 Clients Pay Anywhere, Any Way, Any Time
Value Proposition to REPAY’s Clients’ End Customers Self-service capabilities through ability to pay anywhere, any way and any time, 24 / 7 Option to make real-time payments through use of card transactions Immediate feedback that payment has been processed Omnichannel payment methods (e.g., Web, Mobile, IVR, Text) Fewer ancillary charges (e.g., NSF fees) for borrowers through automatic recurring online debit card payments 2 Pay Anywhere, Any Way, Any Time Businesses and Consumers REPAY Has Built a Leading Next-Gen Software Platform
Consumer Payments Offering Omnichannel Capabilities across Modalities 2 Clients in REPAY’s verticals look to partner with innovative vendors that can provide evolving payment functionality and acceptance solutions Credit and Debit Card Processing ACH Processing Instant Funding eCash New & Emerging Payments Virtual Terminal IVR / Phone Pay Mobile Application Web Portal / Online Bill Pay Hosted Payment Page POS Equipment Text Pay PAYMENT MODALITIES PAYMENT CHANNELS REPRESENTATIVE CLIENTS
Powerful Business Payments Offering 2 One-stop-shop B2B payments solutions provider Automated Reporting and Reconciliation Multiple Payment Options Including Virtual Card and Cross Border Vendor Management Client Rebates Deep ERP Integrations Multiple Payment Methods Tracking and Reconciliation Highly Secure ACCOUNTS RECEIVABLE AUTOMATION ACCOUNTS PAYABLE AUTOMATION TotalPay Solution Cash Inflow Cash Outflow Buyers Suppliers One-stop-shop B2B payments solutions provider REPRESENTATIVE CLIENTS
Key Software Integrations Accelerate Distribution REPAY leverages a vertically tiered sales strategy supplemented by software integrations to drive new client acquisitions Tier 3 (Direct Sales) $5MM+ Monthly Volume Tier 2 (Direct Sales) $1MM – $5MM Monthly Volume Tier 1 (Call Center) <$1MM Monthly Volume Sales Support Team NUMBER OF SOFTWARE INTEGRATION PARTNERS (1) Sales Strategy / Distribution Model 3 37% CAGR Software Integrations Management estimate as of 12/31/2024
Attractive and Diverse Client Base Across Key Verticals REPAY’s platform provides significant value to our clients offering solutions across a variety of industry verticals Healthcare Other ARM B2B Loan Repayment ~20% of card payment volume(2) 4 Represents segment revenue percentage of total revenue after any intersegment eliminations Management estimate as of 12/31/2024. Reflects the reclassification of partnerships between Consumer Payments and Business Payments segments Percentage of Revenue (1) One-stop shop B2B payments solutions provider, offering AP automation and AR merchant acquiring solutions Integrations with ~100(2) leading ERP platforms, serving a highly diversified client base across a wide range of industry verticals AP: Media, Healthcare, Home Services & Property Management, Auto, Municipality, and Other AR: Manufacturing, Distribution, and Hospitality BUSINESS PAYMENTS CONSUMER PAYMENTS ~85% Blue chip ISV partnerships with ~180(2) integrations Market leader in several niche verticals, including the following: Personal Finance Auto Finance Credit Unions ARM Healthcare Mortgage Diversified Retail & Other RCS: Best-in-class clearing & settlement solutions for ~30(2) ISOs and owned clients Expansions into adjacent Buy-Now-Pay-Later vertical as well as Canada ~15%
Demonstrated Ability to Acquire and Successfully Integrate Businesses Represents a significant opportunity to enhance organic growth in existing verticals and accelerate entry into new markets and services Extend Solution Set via New Capabilities New Vertical Expansion Deepen Presence in Existing Verticals Back-end transaction processing capabilities, which enhance M&A strategy Value-add complex exception processing capabilities Expansion into the Healthcare, Automotive, Receivables Management, B2B Acquiring, B2B Healthcare, Mortgage Servicing, B2B AP Automation, BNPL verticals Accelerates expansion into Automotive, Credit Union and Receivables Management verticals THEME Demonstrated ability to source, acquire, and integrate various targets across different verticals Dedicated team to manage M&A pipeline for potential strategic opportunities ACQUISITIONS RATIONALE 5 2017 2019 2016 2017 * 2019 * 2020 2020 * * 2020 * 2020 * 2021 2021 * * 2021 * 2021 * 2021 * *Completed since becoming a public company *
Majority of growth within Consumer Payments is derived from further penetration of existing client base. Majority of growth within Business Payments is derived from acquiring new clients. Multiple Levers to Continue to Drive Growth EXPAND USAGE AND INCREASE ADOPTION (1) ACQUIRE NEW CLIENTS IN EXISTING VERTICALS (2) OPERATIONAL EFFICIENCIES ADDITIONAL VALUE-ADDED SERVICE OPPORTUNITIES REPAY’s leading platform & attractive market opportunity position it to build on its record of robust growth & profitability EXECUTE ON EXISTING BUSINESS BROADEN ADDRESSABLE MARKET AND SOLUTIONS 5 NEW VERTICAL EXPANSION EXPAND NEW AND EXISTING SOFTWARE PARTNERSHIPS STRATEGIC M&A
Richard Thornburgh Senior Advisor, Corsair Bob Hartheimer Senior Advisor, Klaros Group Experienced Board with Deep Payments Expertise John Morris CEO & Co-Founder Shaler Alias President & Co-Founder William Jacobs Former Board Member, Global Payments Board Member, Green Dot Former SVP, Mastercard Peter Kight Chairman, Founder of CheckFree Former Vice Chairman, Fiserv Paul Garcia Former Chairman and CEO, Global Payments Maryann Goebel Former CIO, Fiserv 9-member board of directors comprised of industry veterans and influential leaders in the financial services and payment industries Emnet Rios CFO, Digital Asset 6
3 REPAY Financial Overview
Financial Highlights Low volume attrition and low risk portfolio Differentiated technology platform & ecosystem Deeply integrated with client base Recurring transaction / volume-based revenue SOFTWARE INTEGRATIONS(1) 280 HISTORICAL REVENUE CAGR(2) 13% HISTORICAL GROSS PROFIT CAGR(2) 14% HISTORICAL ADJUSTED EBITDA CAGR(2) 15% FREE CASH FLOW CONVERSION(3) 75% REPAY’s Unique Model Translates Into A Highly Attractive Financial Profile As of 12/31/2024 CAGR is from 2021A-2024A Free Cash Flow Conversion calculated as 2024A Free Cash Flow / 2024A Adjusted EBITDA. These are non-GAAP measures. See slide 1 under “Non-GAAP Financial Measures” and see slides 30 and 31 for reconciliations
Revenue ($MM) Gross Profit ($MM)(1) Strong Profitable Growth… Resilient volume growth & improving card penetration, resulting in 13% CAGR Gross margin consistency from processing cost savings 13% CAGR 14% CAGR 75% 77% 77% % Margin 77%
Adjusted EBITDA ($MM)(1) FREE CASH FLOW ($MM)(1) ...Translating into Accelerating Free Cash Flow Generation Highly scalable platform with attractive margins Significant step up in cash generation from on-going opex and capex management 43% 43% 45% 32% FCF Conversion(2) 30% 76% % Margin These are non-GAAP measures. See slide 1 under “Non-GAAP Financial Measures.” See slides 30 and 31 for reconciliation Free Cash Flow Conversion calculated as Free Cash Flow / Adjusted EBITDA 52% CAGR 15% CAGR 45% 42%
Consumer Payments Business Payments …Across Our Segments… 2% y/y reported growth Gross Profit Margin 78% 79% Gross Profit Margin 73% 74% 3% y/y reported growth 39% y/y reported growth 40% y/y reported growth
Adjusted EBITDA Reconciliation "Reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the business combination with Thunder Bridge, and client relationships, non-compete agreement, and software intangibles acquired through REPAY's acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus, CPS Payments, BillingTree, Kontrol Payables and Payix. This adjustment excludes the amortization of other intangible assets which were acquired in the regular course of business, such as capitalized internally developed software and purchased software. " Reflects the loss recognized related to the disposition of Blue Cow. For the year ended December 31, 2024, reflects a gain on the repurchase of 2026 Notes principal, net of a write-off of debt issuance costs relating to the repurchased principal. For the year ended December 31, 2021, Reflects write-offs of debt issuance costs relating to the Term Loans. Reflects realized loss of our interest rate hedging arrangement which terminated in conjunction with the repayment of Term Loans. Reflects the changes in management’s estimates of future cash consideration to be paid in connection with prior acquisitions from the amount estimated as of the most recent balance sheet date. For the year ended December 31, 2023, reflects non-cash goodwill impairment loss related to the Business Payments segment and non-cash impairment loss related to a trade name write-off of Media Payments. For the year ended December 31, 2022, reflects non-cash impairment loss related to trade names write-offs of BillingTree and Kontrol. For the year ended December 31, 2021, reflects non-cash impairment loss related to trade names write-offs of TriSource, APS, Ventanex, cPayPlus and CPS. For the year ended December 31, 2024, reflects the changes in management’s estimates of the fair value of the liability relating to the Tax Receivable Agreement. For the year ended December 31, 2023, reflects the changes in management’s estimates of (i) the fair value of the liability relating to the Tax Receivable Agreement, and (ii) non-cash insurance reserve. For the year ended December 31, 2022 and 2021, reflects the changes in management’s estimates of the fair value of the liability relating to the Tax Receivable Agreement. Represents compensation expense associated with equity compensation plans. Primarily consists of (i) during the year ended December 31, 2024, professional service fees incurred in connection with prior transactions, (ii) during the year ended December 31, 2023, professional service fees and other costs incurred in connection with the disposition of Blue Cow Software, (iii) during the year ended December 31, 2022, professional service fees and other costs incurred in connection with the acquisitions of BillingTree, Kontrol Payables and Payix, and (iv) during the year ended December 31, 2021, professional service fees and other costs incurred in connection with the acquisitions of Ventanex, cPayPlus, CPS, BillingTree, Kontrol and Payix, as well as professional service expenses related to the January 2021 equity and convertible notes offerings. Reflects costs associated with reorganization of operations, consulting fees related to processing services and other operational improvements, including restructuring and integration activities related to acquired businesses, that were not in the ordinary course during the years ended December 31, 2024, 2023, 2022 and 2021. Additionally, for the year ended December 31, 2022, reflects one-time severance payments. For the year ended December 31, 2024, reflects one-time processing settlements, franchise taxes and other non-income based taxes, non-recurring legal and other litigation expenses and payments made to third-parties in connection with our IT security and personnel. For the year ended December 31, 2023, reflects payments made to third-parties in connection with an expansion of our personnel, franchise taxes and other non-income based taxes and one-time payments to certain partners. For the years ended December 31, 2022 and 2021, reflects one-time payments to certain clients and partners, payments made to third-parties in connection with a significant expansion of our personnel, franchise taxes and other non-income based taxes, other payments related to COVID-19 and non-cash rent expense. Beginning in the period ended December 31, 2023, no longer reflects non-cash rent expense. ($MM) 2021A 2022A 2023A 2024A Net Loss ($56.0) $8.7 ($117.4) ($10.3) Interest Expense, net 3.7 4.2 1.0 1.9 Depreciation and Amortization(1) 89.7 107.8 103.9 103.7 Income Tax Benefit (30.7) 6.2 (2.1) (0.6) EBITDA $6.6 $126.9 ($14.6) $94.7 Loss on business disposition (2) – – 10.0 – (Gain) / Loss on extinguishment of debt(3) 5.9 – – (13.1) Loss on termination of interest rate hedge(4) 9.1 – – – Non-cash change in fair value of contingent consideration(5) 5.8 (3.3) – – Non-cash impairment loss(6) 2.2 8.1 75.8 – Non-cash change in fair value of assets and liabilities(7) 14.1 (66.9) 7.5 14.5 Share-based compensation expense(8) 22.3 20.5 22.2 25.2 Transaction expenses(9) 19.3 19.0 8.5 2.3 Restructuring and other strategic initiative costs(10) 4.6 7.9 11.9 12.5 Other non-recurring charges(11) 3.3 12.3 5.5 4.7 Adjusted EBITDA $93.2 $124.5 $126.8 $140.8
Free Cash Flow Reconciliation Excludes acquisition costs that are capitalized as channel relationships. Represents Free Cash Flow / Adjusted EBITDA. ($MM) 2021A 2022A 2023A 2024A Net Cash provided by Operating Activities $53.3 $74.2 $103.6 $150.1 Capital expenditures Cash paid for property and equipment (2.9) (3.2) (0.7) (1.0) Cash paid for intangible assets (20.6) (33.6) (50.1) (43.9) Total capital expenditures(1) (23.5) (36.8) (50.8) (44.9) Free Cash Flow $29.8 $37.4 $52.8 $105.2 Adjusted EBITDA $93.2 $124.5 $126.8 $140.8 Free Cash Flow conversion(2) 32% 30% 42% 75%
Thank you
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Grafico Azioni Repay (NASDAQ:RPAY)
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Da Mar 2025 a Mar 2025
Grafico Azioni Repay (NASDAQ:RPAY)
Storico
Da Mar 2024 a Mar 2025
