Paysafe Limited (“Paysafe” or the “Company”) (NYSE: PSFE), a
leading payments platform, today announced its financial results
for the fourth quarter and full year of 2023.
Fourth Quarter 2023 Financial Highlights (Metrics
compared to fourth quarter of 2022)
- Revenue of $414.5 million, increased 8%; increased 6% on a
constant currency basis
- Total Payment Volume of $35.8 billion1, increased 8%
- Net loss attributable to the Company of $12.1 million, or
($0.20) per diluted share, compared to $33.7 million, or ($0.56)
per diluted share
- Adjusted net income of $40.9 million, or $0.66 per diluted
share, compared to $33.1 million, or $0.54 per diluted share
- Adjusted EBITDA of $121.7 million, increased 13%; increased 11%
on a constant currency basis
- Net leverage2 decreased to 5.0x as of December 31, 2023,
compared to 5.8x as of December 31, 2022
Full Year 2023 Financial Highlights (Metrics compared to
full year 2022)
- Revenue of $1,601.1 million, increased 7%; increased 6% on a
constant currency basis
- Total Payment Volume of $140.2 billion1, increased 8%
- Net loss attributable to the Company of $20.3 million, or
($0.33) per diluted share, compared to $1,862.7 million, or
($30.78) per diluted share
- Adjusted net income of $143.9 million, or $2.33 per diluted
share, compared to $137.0 million, or $2.25 per diluted share
- Adjusted EBITDA of $458.7 million, increased 12%; increased 11%
on a constant currency basis
Bruce Lowthers, CEO of Paysafe, commented: “We closed out 2023
strong with 8% revenue growth in Q4 and full year growth of 7%,
reflecting our best year since coming public. We have undergone
significant operating changes during this past year which has
allowed us to deliver on the commitments that we set last March,
driving revenue growth, Adjusted EBITDA expansion and a reduction
in our net debt leverage ratio. Our team is excited about the
opportunities ahead, and we look forward to building on this
momentum in 2024 by investing in profitable growth, positioning us
well for 2025 and beyond.”
Recent Strategic and Operational Highlights
- Announced investment plans to expand Paysafe's go-to-market
capabilities to support growth in target verticals, while enhancing
client experience and operational efficiency
- Paysafe ranked 2nd in the J.D. Power 2024 U.S. Merchant
Services Satisfaction StudySM, outperforming the industry average
for all study dimensions
- Published Paysafe research highlighting a shift in how
consumers plan to allocate disposable income, with 42% of survey
respondents planning to prioritize spending on experiences over
possessions
- Improved consumer engagement and satisfaction, while reducing
the rate of customer service contacts through enhancements to
self-service, automation and next-gen customer service tools
- Integrated Visa Network Tokens, adding an additional layer of
protection for cardholders
- Paysafe is now processing iGaming payments in 32 U.S. states
and territories, adding seven new states in 2023, including the
launch of Florida in Q4
(1)
Excludes embedded wallet related volumes of $0.2 billion and $9.2
billion in the fourth quarter of 2023 and 2022, respectively.
Excludes embedded wallet related volumes of $20.5 billion and $37.5
billion in the full year 2023 and 2022, respectively.
(2)
Paysafe defines net leverage as the calculation of net debt (total
debt less cash and cash equivalents) divided by the sum of the last
twelve months (LTM) of Adjusted EBITDA. For the period ending
December 31, 2023, total debt was $2,501.8 million and cash and
cash equivalents was $202.3 million, and LTM Adjusted EBITDA was
$458.7 million. For the period ending December 31, 2022, total debt
was $2,643.5 million and cash and equivalents was $260.2 million,
and LTM Adjusted EBITDA was $410.0 million.
Fourth Quarter and Full Year 2023 Summary of Consolidated
Results
Three Months Ended
Year Ended
December 31,
December 31,
($ in thousands) (unaudited)
2023
2022
2023
2022
Revenue
$
414,541
$
383,568
$
1,601,138
$
1,496,137
Gross Profit (excluding depreciation and
amortization)
$
240,959
$
227,443
$
937,926
$
882,112
Net loss attributable to the Company
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,655
)
Adjusted EBITDA
$
121,741
$
107,561
$
458,663
$
409,951
Adjusted net income attributable to the
Company
$
40,862
$
33,089
$
143,888
$
137,043
Fourth Quarter 2023 Results
Total revenue for the fourth quarter of 2023 was $414.5 million,
an increase of 8%, compared to $383.6 million in the prior year
period, reflecting 8% growth in total payment volume. Excluding an
$8.6 million favorable impact from changes in foreign exchange
rates, total revenue increased 6%. Revenue from the Merchant
Solutions segment increased 9%, led by double-digit growth from
e-commerce solutions. Revenue from the Digital Wallets segment
increased 8% on a reported basis and 3% on a constant currency
basis, as a decline from eCash solutions was more than offset by
double-digit growth from classic digital wallets, partly reflecting
the Company's initiatives to increase consumer engagement and
merchant checkout conversion rates. Growth from the Digital Wallets
segment was also supported by new product features and interest
revenue on consumer deposits.
Net loss attributable to the Company for the fourth quarter was
$12.1 million, compared to $33.7 million in the prior year period.
The decrease in net loss primarily reflects growth in operating
income, including a decrease in share-based compensation expense,
partly offset by an increase in tax expense.
Adjusted net income for the fourth quarter increased 23% to
$40.9 million, compared to $33.1 million in the prior year period
as strong growth in Adjusted EBITDA more than offset higher
depreciation and amortization expense, excluding the amortization
of acquired intangibles.
Adjusted EBITDA for the fourth quarter was $121.7 million, an
increase of 13%, compared to $107.6 million in the prior year
period. Excluding a $2.6 million favorable impact from changes in
foreign exchange rates, Adjusted EBITDA increased 11% compared to
the prior year period, primarily reflecting revenue growth,
operating leverage and lower credit losses.
Fourth quarter operating cash flow was $61.6 million, compared
to $64.1 million in the prior year period. Unlevered free cash flow
was $89.6 million, compared to $99.9 million in the prior year
period, which was mainly driven by movements in working
capital.
Full Year 2023 Results
Total revenue for the full year 2023 was $1,601.1 million, an
increase of 7%, compared to $1,496.1 million in the prior year.
Excluding a $16.3 million favorable impact from changes in foreign
exchange rates, total revenue increased 6% compared to the prior
year. Revenue from the Merchant Solutions segment increased 7%.
Revenue from the Digital Wallets segment increased 7% on a reported
basis and 5% on a constant currency basis. Growth drivers for the
full year 2023 were consistent with those in the fourth quarter of
2023, driven by Paysafe's e-commerce solutions and classic digital
wallets, including the benefit of interest revenue earned on
consumer deposits, coupled with continued growth and resilience in
the U.S. SMB market.
Net loss attributable to the Company for the full year 2023 was
$20.3 million, compared to $1,862.7 million in the prior year. The
decrease in net loss was largely attributable to non-cash charges
related to the impairment of goodwill and intangibles recognized in
2022, as well as a decrease in restructuring expense, partly offset
by the recognition of income tax expense in 2023, compared to an
income tax benefit in 2022, as well as a decrease in other
income.
Adjusted EBITDA for the full year 2023 was $458.7 million, an
increase of 12%, compared to $410.0 million in the prior year.
Excluding an $5.6 million favorable impact from changes in foreign
exchange rates, Adjusted EBITDA increased 11%, primarily reflecting
revenue growth, operating leverage and lower credit losses.
Adjusted net income for the full year 2023 increased 5% to
$143.9 million, compared to $137.0 million in the prior year. The
increase in adjusted net income was largely attributable to the
same factors that contributed to growth in Adjusted EBITDA, partly
offset by an increase in depreciation and amortization expense,
excluding the amortization of acquired intangibles, and an increase
in interest expense.
Operating cash flow for 2023 was $234.0 million, compared to
$237.2 million in the prior year. Unlevered free cash flow
increased to $318.3 million, compared to $295.8 million in the
prior year due to movements in working capital, partly offset by an
increase in capital expenditures.
Balance Sheet
As of December 31, 2023, total cash and cash equivalents were
$202.3 million, total debt was $2.5 billion and net debt was $2.3
billion. Compared to December 31, 2022, total debt decreased by
$141.6 million, reflecting net repayments of $174.3 million as well
as movement in foreign exchange rates.
Summary of Segment Results
Three Months Ended
Year Ended
December 31,
YoY
December 31,
YoY
($ in thousands) (unaudited)
2023
2022
change
2023
2022
change
Revenue:
Merchant Solutions
$
227,280
$
208,505
9
%
$
878,346
$
817,353
7
%
Digital Wallets
$
191,287
$
177,141
8
%
$
734,669
$
686,165
7
%
Intersegment
$
(4,026
)
$
(2,078
)
94
%
$
(11,877
)
$
(7,381
)
61
%
Total Revenue
$
414,541
$
383,568
8
%
$
1,601,138
$
1,496,137
7
%
Adjusted EBITDA:
Merchant Solutions
$
56,582
$
51,022
11
%
$
222,154
$
200,304
11
%
Digital Wallets
$
82,356
$
77,127
7
%
$
318,706
$
289,413
10
%
Corporate
$
(17,197
)
$
(20,588
)
16
%
$
(82,197
)
$
(79,766
)
-3
%
Total Adjusted EBITDA
$
121,741
$
107,561
13
%
$
458,663
$
409,951
12
%
Full Year 2024 Financial Guidance
($ in millions) (unaudited)
Full Year 2024
Revenue
$1,688 - $1,712
Adjusted EBITDA
$473 - $488
Webcast and Conference Call
Paysafe will host a live webcast to discuss the results today at
8:30 a.m. (ET). The webcast and supplemental information can be
accessed on the investor relations section of the Paysafe website
at ir.paysafe.com. An archive will be available after the
conclusion of the live event and will remain available via the same
link for one year.
Time
Thursday, March 7 2024, at 8:30 a.m.
ET
Webcast
Go to the Investor Relations section of
the Paysafe website to listen and view slides
Dial in
877-407-3037 (U.S. toll-free);
215-268-9852 (International)
About Paysafe
Paysafe Limited (“Paysafe”) (NYSE: PSFE) (PSFE.WS) is a leading
payments platform with an extensive track record of serving
merchants and consumers in the global entertainment sectors. Its
core purpose is to enable businesses and consumers to connect and
transact seamlessly through industry-leading capabilities in
payment processing, digital wallet, and online cash solutions. With
over 20 years of online payment experience, an annualized
transactional volume of $140 billion in 2023, and approximately
3,200 employees located in 12+ countries, Paysafe connects
businesses and consumers across 260 payment types in over 40
currencies around the world. Delivered through an integrated
platform, Paysafe solutions are geared toward mobile-initiated
transactions, real-time analytics and the convergence between
brick-and-mortar and online payments. Further information is
available at www.paysafe.com.
Forward-looking Statements
This press release includes “forward-looking statements” within
the meaning of U.S. federal securities laws. These forward-looking
statements are provided for illustrative purposes only and are not
intended to serve as, and must not be relied on by any investor as,
a guarantee, an assurance, a prediction or a definitive statement
of fact or probability. Paysafe Limited’s (“Paysafe,” “PSFE,” the
“Company,” “we,” “us,” or “our”) actual results may differ from
their expectations, estimates, and projections and, consequently,
you should not rely on these forward-looking statements as
predictions of future events. Words such as “anticipate,” “appear,”
“approximate,” “believe,” “budget,” “continue,” “could,”
“estimate,” “expect,” “forecast,” “foresee,” “guidance,” “intends,”
“likely,” “may,” “might,” “plan,” “possible,” “potential,”
“predict,” “project,” “seek,” “should,” "will," “would” and
variations of such words and similar expressions (or the negative
version of such words or expressions) may identify forward-looking
statements, but the absence of these words does not mean that a
statement is not forward-looking. These forward-looking statements
include, without limitation, Paysafe’s expectations with respect to
future performance.
These forward-looking statements involve significant risks,
uncertainties, and events that may cause the actual results to
differ materially, and potentially adversely, from those expressed
or implied in the forward-looking statements. While the Company
believes its assumptions concerning future events are reasonable, a
number of factors could cause actual results to differ materially
from those projected, including, but not limited to: cyberattacks
and security vulnerabilities; complying with and changes in money
laundering regulations, financial services regulations,
cryptocurrency regulations, consumer and business privacy and data
use regulations or other regulations in Bermuda, the UK, Ireland,
Switzerland, the United States, Canada and elsewhere; risks related
to our focus on specialized and high-risk verticals; geopolitical
events and the economic and other impacts of such geopolitical
events and the responses of governments around the world; acts of
war and terrorism; the effects of global economic uncertainties,
including inflationary pressure and rising interest rates, on
consumer and business spending; risks associated with foreign
currency exchange rate fluctuations; changes in our relationships
with banks, payment card networks, issuers and financial
institutions; risk related to processing online payments for
merchants and customers engaged in the online gambling and foreign
exchange trading sectors; risks related to becoming an unwitting
party to fraud or being deemed to be handling proceeds resulting
from the criminal activity by customers; the effects of
chargebacks, merchant insolvency and consumer deposit settlement
risk; changes to our continued financial institution sponsorships;
failure to hold, safeguard or account accurately for merchant or
customer funds; risks related to the availability, integrity and
security of internal and external IT transaction processing systems
and services; our ability to manage regulatory and litigation
risks, and the outcome of legal and regulatory proceedings; failure
of fourth parties to comply with contractual obligations; changes
and compliance with payment card network operating rules;
substantial and increasingly intense competition worldwide in the
global payments industry; risks related to developing and
maintaining effective internal controls over financial reporting;
managing our growth effectively, including growing our revenue
pipeline; any difficulties maintaining a strong and trusted brand;
keeping pace with rapid technological developments; risks
associated with the significant influence of our principal
shareholders; the effect of regional epidemics or a global pandemic
on our business; and other factors included in the “Risk Factors”
in our Form 20-F and in other filings we make with the SEC, which
are available at https://www.sec.gov. Readers are cautioned not to
place undue reliance upon any forward-looking statements, which
speak only as of the date made.
The Company expressly disclaims any obligations or undertaking
to release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in their
expectations with respect thereto or any change in events.
Paysafe Limited Condensed Consolidated
Balance Sheets (unaudited)
($ in thousands)
December 31, 2023
December 31, 2022
Assets
Current assets
Cash and cash equivalents
$
202,322
$
260,219
Customer accounts and other restricted
cash
1,295,947
1,866,976
Accounts receivable, net of allowance for
credit losses of $5,240 and $10,558, respectively
162,081
159,324
Settlement receivables, net of allowance
for credit losses of $5,197 and $5,398, respectively
171,224
147,774
Prepaid expenses and other current
assets
74,919
60,810
Total current assets
1,906,493
2,495,103
Deferred tax assets
77,273
104,538
Property, plant and equipment, net
17,213
11,947
Operating lease right-of-use assets
22,120
35,509
Derivative asset
10,427
17,321
Intangible assets, net
1,163,935
1,291,458
Goodwill
2,023,402
1,999,132
Other assets – non-current
6,838
2,048
Total non-current assets
3,321,208
3,461,953
Total assets
$
5,227,701
$
5,957,056
Liabilities and equity
Current liabilities
Accounts payable and other liabilities
$
202,699
$
241,529
Short-term debt
10,190
10,190
Funds payable and amounts due to
customers
1,477,017
1,997,867
Operating lease liabilities – current
8,233
7,953
Income taxes payable
—
11,325
Contingent and deferred consideration
payable – current
11,828
18,171
Liability for share-based compensation –
current
2,701
11,400
Total current liabilities
1,712,668
2,298,435
Non-current debt
2,491,643
2,633,269
Operating lease liabilities –
non-current
16,963
29,913
Deferred tax liabilities
111,705
118,791
Warrant liabilities
1,423
3,094
Liability for share-based compensation –
non-current
3,108
4,942
Contingent and deferred consideration
payable – non-current
6,878
8,975
Other liabilities – non-current
—
—
Total non-current liabilities
2,631,720
2,798,984
Total liabilities
4,344,388
5,097,419
Commitments and contingent liabilities
Total shareholders' equity
883,313
859,637
Total liabilities and shareholders'
equity
$
5,227,701
$
5,957,056
Paysafe Limited Condensed Consolidated
Statements of Operations (unaudited)
Three Months Ended
Year Ended
December 31,
December 31,
($ in thousands)
2023
2022
2023
2022
Revenue
$
414,541
$
383,568
$
1,601,138
$
1,496,137
Cost of services (excluding depreciation
and amortization)
173,582
156,125
663,212
614,025
Selling, general and administrative
125,030
136,988
508,136
534,515
Depreciation and amortization
66,387
67,723
263,433
266,819
Impairment expense on goodwill and
intangible assets
979
1,000
1,254
1,887,223
Restructuring and other costs
1,896
3,496
6,061
64,132
Loss on disposal of subsidiary and other
assets, net
386
—
386
1,359
Operating income / (loss)
46,281
18,236
158,656
(1,871,936
)
Other (expense) / income, net
(6,503
)
(14,085
)
13,081
83,778
Interest expense, net
(38,509
)
(37,615
)
(151,148
)
(126,628
)
Income / (loss) before taxes
1,269
(33,464
)
20,589
(1,914,786
)
Income tax expense / (benefit)
13,398
247
40,840
(52,502
)
Net loss
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,284
)
Less: net income attributable to
non-controlling interest
—
—
—
371
Net loss attributable to the
Company
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,655
)
Net loss per share attributable to the
Company – basic
$
(0.20
)
$
(0.56
)
$
(0.33
)
$
(30.78
)
Net loss per share attributable to the
Company – diluted
$
(0.20
)
$
(0.56
)
$
(0.33
)
$
(30.78
)
Net loss
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,284
)
Other comprehensive income / (loss), net
of tax of $0:
Gain / (loss) on foreign currency
translation
12,805
21,409
14,330
(34,251
)
Total comprehensive gain /
(loss)
$
676
$
(12,302
)
$
(5,921
)
$
(1,896,535
)
Less: comprehensive income attributable to
non-controlling interest
—
0
—
371
Total comprehensive gain / (loss)
attributable to the Company
$
676
$
(12,302
)
$
(5,921
)
$
(1,896,906
)
Paysafe Limited Consolidated Net (loss) /
income per share attributable to the Company
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
Numerator ($ in thousands)
Net loss attributable to the Company -
basic
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,655
)
Net loss attributable to the Company -
diluted
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,655
)
Denominator (in millions)
Weighted average shares – basic
61.7
60.7
61.4
60.5
Weighted average shares – diluted
61.7
60.7
61.4
60.5
Net loss per share attributable to the
Company
Basic
$
(0.20
)
$
(0.56
)
$
(0.33
)
$
(30.78
)
Diluted
$
(0.20
)
$
(0.56
)
$
(0.33
)
$
(30.78
)
Paysafe Limited Condensed Consolidated
Statements of Cash Flow (unaudited)
Year Ended
December 31,
($ in thousands)
2023
2022 (1)
Cash flows from operating
activities
Net loss
$
(20,251
)
$
(1,862,284
)
Adjustments for non-cash items:
Depreciation and amortization
264,145
266,819
Unrealized foreign exchange loss /
(gain)
411
(44,157
)
Deferred tax expense / (benefit)
19,692
(82,876
)
Interest expense, net
(2,642
)
24,394
Share-based compensation
28,873
62,354
Other income, net
(20,515
)
(45,489
)
Impairment expense on goodwill and
intangible assets
1,254
1,887,223
Allowance for credit losses and other
21,186
35,541
Loss on disposal of subsidiary and other
assets, net
386
1,359
Non-cash lease expense
8,937
7,034
Movements in working capital:
Accounts receivable, net
(18,813
)
(34,224
)
Prepaid expenses, other current assets,
and related party receivables
6,953
(13,085
)
Accounts payable, other liabilities, and
related party payables
(32,974
)
17,400
Income tax (receivable) / payable
(22,620
)
17,192
Net cash flows from operating
activities
234,022
237,201
Cash flows in investing
activities
Purchase of property, plant &
equipment
(12,849
)
(4,543
)
Purchase of merchant portfolios
(30,735
)
(56,438
)
Other intangible asset expenditures
(89,319
)
(89,065
)
Acquisition of business, net of cash
acquired
—
(424,722
)
Net cash outflow on disposal of
subsidiary
—
(826
)
Receipts under derivative financial
instruments
10,208
—
Cash outflow for merchant reserves
(24,400
)
Cash inflow from merchant reserves
12,200
—
Other investing activities, net
(342
)
—
Net cash flows used in investing
activities
(135,237
)
(575,594
)
Cash flows from financing
activities
Cash settled equity awards
(484
)
(990
)
Repurchases of shares withheld for
taxes
(8,467
)
(6,937
)
Proceeds from exercise of warrants
5
3
Settlement funds - merchants and
customers, net
(588,151
)
686,877
Repurchase of borrowings
(167,424
)
(45,511
)
Proceeds from loans and borrowings
125,597
120,669
Repayments of loans and borrowings
(121,724
)
(148,919
)
Payment of debt issuance costs
—
(6,781
)
Proceeds under line of credit
900,000
796,600
Repayments under line of credit
(900,000
)
(771,600
)
Receipts under derivative financial
instruments, net
—
137
Contingent consideration received
300
2,621
Contingent and deferred consideration
paid
(10,680
)
(19,834
)
Net cash flows (used in) / provided by
financing activities
(771,028
)
606,335
Effect of foreign exchange rate
changes
43,317
(112,465
)
(Decrease) / increase in cash and cash
equivalents, including customer accounts and other restricted cash
during the period
$
(628,926
)
$
155,477
Cash and cash equivalents, including
customer accounts and other restricted cash at beginning of the
period
2,127,195
1,971,718
Cash and cash equivalents at end of the
period, including customer accounts and other restricted
cash
$
1,498,269
$
2,127,195
Year Ended
December 31,
2023
2022
Cash and cash equivalents
$
202,322
$
260,219
Customer accounts and other restricted
cash, net
1,295,947
1,866,976
Total cash and cash equivalents,
including customer accounts and other restricted cash, net
$
1,498,269
$
2,127,195
(1)
During the fourth quarter of 2023, the Company elected to change
its presentation of the cash flows associated with "Settlement
receivables, net" and "Funds payable and amounts due to customers"
from operating activities, to present them as financing activities
within its Consolidated Statements of Cash Flows. Comparative
amounts have been recast to conform to current period presentation.
These recasts had no impact on the Consolidated Statements of
Comprehensive Loss, Consolidated Statements of Financial Position
or Consolidated Statements of Shareholders' Equity.
Non-GAAP Financial Measures
To supplement the Company’s condensed consolidated financial
statements presented in accordance with generally accepted
accounting principles, or GAAP, the company uses non-GAAP measures
of certain components of financial performance. This includes Gross
Profit (excluding depreciation and amortization), Adjusted EBITDA,
Unlevered free cash flow, Adjusted net income, Adjusted net income
per share, and Net leverage which are supplemental measures that
are not required by, or presented in accordance with, accounting
principles generally accepted in the United States (“U.S.
GAAP”).
Gross Profit (excluding depreciation and amortization) is
defined as revenue less cost of services (excluding depreciation
and amortization). Management believes Gross Profit to be a useful
profitability measure to assess the performance of our businesses
and ability to manage cost.
Adjusted EBITDA is defined as net income/(loss) before the
impact of income tax (benefit)/expense, interest expense, net,
depreciation and amortization, share-based compensation, impairment
expense on goodwill and intangible assets, restructuring and other
costs, loss/(gain) on disposal of a subsidiaries and other assets,
net, and other income/(expense), net. These adjustments also
include certain costs and transaction items that are not reflective
of the underlying operating performance of the Company. Management
believes Adjusted EBITDA to be a useful profitability measure to
assess the performance of our businesses and improves the
comparability of operating results across reporting periods.
Adjusted net income excludes the impact of certain
non-operational and non-cash items. Adjusted net income is defined
as net income/(loss) attributable to the Company before the impact
of other non-operating income / (expense), net, impairment expense
on goodwill and intangible assets, restructuring and other costs,
accelerated amortization of debt fees, amortization of acquired
assets, loss/(gain) on disposal of subsidiaries and other assets,
share-based compensation, discrete tax items and the income tax
(benefit)/expense on these non-GAAP adjustments. Adjusted net
income per share is adjusted net income as defined above divided by
adjusted weighted average dilutive shares outstanding. Management
believes the removal of certain non-operational and non-cash items
from net income enhances shareholders ability to evaluate the
Company’s business performance and profitability by improving
comparability of operating results across reporting periods.
Unlevered free cash flow is defined as net cash flows provided
by/used in operating activities, adjusted for the impact of capital
expenditure, payments relating to restructuring and other costs and
cash paid for interest. Capital expenditure includes purchases of
property plant & equipment and purchases of other intangible
assets, including software development costs. Capital expenditure
does not include purchases of merchant portfolios. Management
believes unlevered free cash flow to be a liquidity measure that
provides useful information about the amount of cash generated by
the business.
Net leverage is defined as net debt (gross debt less cash and
cash equivalents) divided by the last twelve months Adjusted
EBITDA. Management believes net leverage is a useful measure of the
Company's credit position and progress towards leverage
targets.
Management believes the presentation of these non-GAAP financial
measures, including Gross Profit, Adjusted EBITDA, Unlevered free
cash flow, Adjusted net income, Adjusted net income per share, and
Net leverage when considered together with the Company’s results
presented in accordance with GAAP, provide users with useful
supplemental information in comparing the operating results across
reporting periods by excluding items that are not considered
indicative of Paysafe’s core operating performance. In addition,
management believes the presentation of these non-GAAP financial
measures provides useful supplemental information in assessing the
Company’s results on a basis that fosters comparability across
periods by excluding the impact on the Company’s reported GAAP
results of acquisitions and dispositions that have occurred in such
periods. However, these non-GAAP measures exclude items that are
significant in understanding and assessing Paysafe’s financial
results or position. Therefore, these measures should not be
considered in isolation or as alternatives to revenue, net income,
cash flows from operations or other measures of profitability,
liquidity or performance under GAAP.
You should be aware that Paysafe’s presentation of these
measures may not be comparable to similarly titled measures used by
other companies. In addition, the forward-looking non-GAAP
financial measure of Adjusted EBITDA provided herein have not been
reconciled to the comparable GAAP measure due to the inherent
difficulty in forecasting and quantifying certain amounts that are
necessary for such reconciliations. We have reconciled the
historical non-GAAP financial measures presented herein to their
most directly comparable GAAP financial measures. A reconciliation
of our forward-looking non-GAAP financial measures to their most
directly comparable GAAP financial measures cannot be provided
without unreasonable effort because of the inherent difficulty of
accurately forecasting the occurrence and financial impact of the
adjusting items necessary for such reconciliations that have not
yet occurred, are out of our control, or cannot be reasonably
predicted. For the same reasons, we are unable to address the
probable significance of the unavailable information, which could
be material to future results.
Reconciliation of GAAP Net Loss to Adjusted EBITDA
Three Months Ended
Year Ended
December 31,
December 31,
($ in thousands)
2023
2022
2023
2022
Net loss
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,284
)
Income tax expense / (benefit)
13,398
247
40,840
(52,502
)
Interest expense, net
38,509
37,615
151,148
126,628
Depreciation and amortization
66,387
67,723
263,433
266,819
Share-based compensation expense
5,812
17,106
28,873
62,354
Impairment expense on goodwill and
intangible assets
979
1,000
1,254
1,887,223
Restructuring and other costs
1,896
3,496
6,061
64,132
Loss on disposal of subsidiaries and other
assets, net
386
—
386
1,359
Other expense / (income), net
6,503
14,085
(13,081
)
(83,778
)
Adjusted EBITDA
$
121,741
$
107,561
$
458,663
$
409,951
Reconciliation of Operating Cash Flow to Non-GAAP Unlevered
Free Cash Flow
Three Months Ended
Year Ended
December 31,
December 31,
($ in thousands)
2023
2022 (1)
2023
2022 (1)
Net cash inflows from operating
activities
$
61,592
$
64,145
$
234,022
$
237,201
Capital expenditure
(20,646
)
(23,915
)
(102,168
)
(93,608
)
Cash paid for interest
46,543
38,614
153,790
102,234
Payments relating to Restructuring and
other costs
2,093
21,102
32,655
49,970
Unlevered Free Cash Flow
$
89,582
$
99,946
$
318,299
$
295,797
Adjusted EBITDA
121,741
107,561
458,663
409,951
(1)
During the fourth quarter of 2023, the Company elected to change
its presentation of "Settlement receivables, net" and "Funds
payable and amounts due to customers" from operating activities, to
present them as financing activities within its consolidated
statements of cash flows. As a result, the reconciling item related
to "Movements in customer accounts and other restricted cash, net"
is no longer required in the unlevered free cash flow
reconciliation. Comparative amounts have been recast to conform to
current period presentation.
Reconciliation of GAAP Gross Profit to Non-GAAP Gross Profit
(excluding depreciation and amortization)
Three Months Ended
Year Ended
December 31,
December 31,
($ in thousands)
2023
2022
2023
2022
Revenue
$
414,541
$
383,568
$
1,601,138
$
1,496,137
Cost of services (excluding depreciation
and amortization)
173,582
156,125
663,212
614,025
Depreciation and amortization
66,387
67,723
263,433
266,819
Gross Profit (1)
$
174,572
$
159,720
$
674,493
$
615,293
Depreciation and amortization
66,387
67,723
263,433
266,819
Gross Profit (excluding depreciation
and amortization)
$
240,959
$
227,443
$
937,926
$
882,112
(1)
Gross Profit has been calculated as revenue, less cost of services
and depreciation and amortization. Gross profit is not presented
within the Company's consolidated financial statements.
Reconciliation of GAAP Net Loss to Adjusted Net
Income
Three Months Ended
Year Ended
December 31,
December 31,
($ in thousands)
2023
2022
2023
2022
Net loss attributable to the
Company
$
(12,129
)
$
(33,711
)
$
(20,251
)
$
(1,862,655
)
Other non operating expense / (income),
net (1)
9,539
14,438
(3,313
)
(89,383
)
Impairment expense on goodwill and
intangible assets
979
1,000
1,254
1,887,223
Amortization of acquired assets (2)
33,531
40,317
135,393
167,345
Restructuring and other costs
1,896
3,496
6,061
64,132
Loss on disposal of subsidiaries and other
assets, net
386
—
386
1,359
Share-based compensation expense
5,812
17,106
28,873
62,354
Discrete tax items (3)
12,785
24,672
37,983
36,311
Income tax expense on non-GAAP adjustments
(4)
(11,937
)
(34,229
)
(42,498
)
(129,643
)
Adjusted net income attributable to the
Company
$
40,862
$
33,089
$
143,888
$
137,043
(in millions)
Weighted average shares -
diluted
61.7
60.7
61.4
60.5
Adjusted diluted impact
0.1
0.5
0.3
0.4
Adjusted weighted average shares -
diluted
61.8
61.2
61.7
60.9
(1)
Other non-operating expense / (income), net primarily consists of
income and expenses outside of the Company's operating activities,
including, fair value gain / loss on warrant liabilities and
derivatives, gain / loss on repurchases of debt and gain / loss on
foreign exchange. For the three and twelve months ended December
31, 2023, this item also includes the gain to repurchase secured
notes and fair value loss on derivative instruments.
(2)
Amortization of acquired asset represents amortization expense on
the fair value of intangible assets acquired through various
Company acquisitions, including brands, customer relationships,
software and merchant portfolios.
(3)
Discrete tax items mainly represent (a) valuation allowance
recorded on deferred tax assets of $9,864 and $22,227 for the three
months ended December 31, 2023 and 2022, respectively and $25,397
and $32,450 for the year ended December 31, 2023 and 2022,
respectively (b) measurement period adjustments which were $4,629
and $516 for the three months ended December 31, 2023 and 2022,
respectively and $8,829 and $3,860 for the year ended December 31,
2023 and 2022, respectively and (c) discrete tax expense or benefit
on share-based compensation, which would not have been incurred as
share-based compensation expense is removed from adjusted net
income, of $618 and $0 for the three months ended December 31, 2023
and 2022, respectively and $4,595 and $0 for the year ended
December 31, 2023 and 2022, respectively. The remaining discrete
tax items relate to changes in uncertain tax positions and the
remeasurement of certain deferred tax balances due to changes in
the statutory tax rates in certain jurisdictions.
(4)
Income tax expense on non-GAAP adjustments reflects the tax expense
on each taxable adjustment using the current statutory tax rate of
the applicable jurisdiction specific to that adjustment.
Adjusted Net Income per Share
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
Numerator ($ in thousands)
Adjusted net income attributable to the
Company - basic
$
40,862
$
33,089
$
143,888
$
137,043
Adjusted net income attributable to the
Company - diluted
$
40,862
$
33,089
$
143,888
$
137,043
Denominator (in millions)
Weighted average shares – basic
61.7
60.7
61.4
60.5
Adjusted weighted average shares – diluted
(1)
61.8
61.2
61.7
60.9
Adjusted net income per share attributable
to the Company
Basic
$
0.66
$
0.55
$
2.34
$
2.26
Diluted
$
0.66
$
0.54
$
2.33
$
2.25
(1)
The denominator used in the calculation of diluted adjusted net
income per share attributable to the Company for the three and
twelve months ended December 31, 2023 and 2022 has been adjusted to
include the dilutive effect of the Company's restricted stock
units.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240306805418/en/
Media Crystal Wright Paysafe crystal.wright@paysafe.com +1 (904)
328-7740 Investors Kirsten Nielsen Paysafe +1 (646) 901-3140
kirsten.nielsen@paysafe.com
Grafico Azioni Paysafe (NYSE:PSFE)
Storico
Da Dic 2024 a Gen 2025
Grafico Azioni Paysafe (NYSE:PSFE)
Storico
Da Gen 2024 a Gen 2025