- First quarter total revenues of $8.2 million, an increase of
$1.9 million from first quarter 2021
- First quarter net loss of $0.3 million, or diluted net loss
per share of ($0.01)
- First quarter adjusted EBITDA of $0.9 million, or diluted
adjusted EBITDA per share of $0.02
- First quarter gross dollar load volume up 16.2% versus the
year-ago period and 7.6% versus the previous quarter
- First quarter purchase volume up 24.7% versus the year-ago
period
- First quarter unrestricted cash increased by $1.1 million to
$8.5 million
Paysign, Inc. (NASDAQ: PAYS), a leading provider of prepaid card
programs, comprehensive patient affordability offerings, digital
banking services and integrated payment processing, today announced
financial results for the first quarter of 2022.
“We are pleased with our Q1 2022 results with good revenue
growth as our key performance indicators return to a pre-pandemic
normalcy,” said Mark Newcomer, Paysign CEO. “We continue to win new
deals and onboard new plasma centers and pharma clients. We’re
seeing strong interest in our pharma solutions as the industry
navigates the upcoming CMS 2023 rule changes.”
Quarterly Results
The following additional details are provided to aid in
understanding Paysign’s first quarter 2022 results versus the
year-ago period:
- Revenues increased $1.9 million (31%) versus the year-ago
period. The change was driven by the impact of the following
factors:
- Plasma revenue increased $2.0 million (37%) primarily due to an
increase in plasma donations and dollars loaded onto cards. The
average monthly revenue per plasma center increased to $6,672
versus $5,260 during the same period a year ago. We added nine new
plasma centers during the quarter, exiting the quarter with 375
centers. This compares to 366 centers at the end of 2021 and 343
centers at the end of Q1 2021.
- Pharma revenue decreased $76 thousand (-9%) primarily driven by
the ending of four pharma prepaid programs throughout 2021 and the
recognition of settlement income in Q1 2021 from one of those
programs, offset with the addition of seven new pharma copay
programs that have launched since March 31, 2021.
- Cost of revenues decreased by $225 thousand (-7%). Cost of
revenues comprises of transaction processing fees, data
connectivity, data center expenses, network fees, bank fees, card
production, postage costs, customer service, program management,
application integration setup and sales and commission expense. The
decrease was primarily due to the renewal and restructuring of an
agreement in the first quarter of 2022, offset by the increase in
variable transaction costs as a result of increased plasma
transactions which occurred during the period.
- Gross profit increased $2.2 million (77%) primarily due to the
increase in plasma revenue and profitability. Our gross profit
margin improved to 60.8%.
- Selling, general and administrative expenses increased $776
thousand or 20.1% compared to the same period in the prior year and
consisted primarily of (i) an increase in compensation and benefits
of $84 thousand due to continued hiring to support the company’s
growth, a tight labor market and increased personnel insurance
costs; (ii) a decrease in stock-based compensation of $67 thousand;
(iii) a decrease in outside professional services for legal, tax,
accounting and consultants of $95 thousand; (vi) an increase in
legal settlements of $354 thousand; (iv) an increase in
non-personnel insurance of $111 thousand; (v) an increase in
technologies and telecom of $178 thousand; (vi) a decrease in rent,
utilities and maintenance of $30 thousand; (vii) an increase in
travel and entertainment of $75 thousand due to a more normalized
working environment and trade show expenses; and (viii) an increase
in other operating expenses of $166 thousand.
- Depreciation and amortization increased $83 thousand due to the
continued capitalization of new software and equipment and
continued enhancements to our platform.
- Other income increased $7 thousand related to an increase in
interest income resulting from higher restricted cash balances and
rising interest rates.
- Income tax provision increased slightly as a result of the full
valuation on our deferred tax asset in both the current and prior
period and the tax benefit related to our stock-based compensation
and a pretax loss in the prior year period. The effective tax rate
was (0.6%) and (0.1%) for the periods ending March 31, 2022, and
2021, respectively.
- Net loss decreased $1.3 million to a loss of $309 thousand. The
overall change in net loss relates to the factors mentioned
above.
- “EBITDA,” which is defined as earnings before interest, taxes,
depreciation and amortization expense, and which is a non-GAAP
metric, increased $1.4 million to a profit of $357 thousand due to
the factors above.
- “Adjusted EBITDA,” which reflects the adjustment to EBITDA to
exclude stock-based compensation charges, and which is a non-GAAP
metric used by management to gauge the operating performance of the
business, increased $1.3 million to a profit of $927 thousand due
to the factors mentioned above. If not for legal settlements of
$354 thousand during the quarter, Adjusted EBITDA would have been
$1.3 million.
Q1 2022 Milestones
- As of March 31, 2022, we had approximately 4.4 million
cardholders and 438 card programs.
- Year-over-year revenue increased 30.9%.
- We added 9 plasma programs and launched 4 new pharma copay
programs.
Balance Sheet At March 31, 2022
Unrestricted cash increased $1.1 million to $8.5 million due
primarily to the improvement of our plasma business on our
operations. Our operating results continued to improve over the
same period a year ago enabling us to generate positive cash flow
from operations, a trend that started in the second half of 2021.
Restricted cash of $64.7 million are funds used for customer card
funding with a corresponding offset under current liabilities. The
increase in the first quarter of 2022 versus the end of 2021 was
predominately related to increases in funds on cards, increased
plasma deposits and new plasma and pharma copay customers, offset
by declines from pharma prepaid customers whose contracts ended at
the end of the year. Accounts payable and accrued liabilities
increased $1.2 million primarily due to the continued growth of our
copay programs. We believe that our unrestricted cash on hand at
March 31, 2022, of $8.5 million along with forecast revenues and
operating profits anticipated for 2022, as well as our accounts
receivable and accounts payable processes, will be sufficient to
sustain our operations for the next twelve months.
2022 Outlook
“Our plasma business continues to rebound from the negative
impact experienced from COVID-19. On an aggregated basis, we are
back to pre-pandemic operating levels even though we have not yet
obtained those levels on a per plasma donation center basis as the
labor market remains tight and donations from Mexican nationals
along the US border remain halted. Despite these ongoing headwinds,
we continue to post year-over-year improvements in our operating
results and expect that trend to continue as we move throughout
2022. Our balance sheet remains strong and we expect it to continue
to expand as an outcome of the operating result improvements,” said
Jeff Baker, Paysign CFO.
“Our guidance for the full year of 2022 remains unchanged. We
expect total revenue to be in the range of $35.25 million to $38.35
million, reflecting growth of 20% to 30%, with plasma making up
approximately 90% of total revenue. Pharma revenue is expected to
be relatively flat year over year as the loss of programs and
settlement income in 2021 are offset with new pharma copay
programs. Adjusted EBITDA is expected to at least double to $4.0
million over 2021’s adjusted EBITDA of $2.0 million. Full year
gross profit margins are expected to be approximately 50.0% to
52.5% as they are expected to return to a more normalized gross
profit margin experienced in 2021. Operating expenses are expected
to increase to approximately $20.0 million as we continue to make
investments in people and technology, and experience higher costs
in insurance, travel and entertainment and other inflationary
pressures. Depreciation and amortization is expected to be between
$3.0 million and $3.25 million while stock-based compensation is
expected to be approximately $2.0 million,” Baker concluded.
COVID-19 Update
The coronavirus (“COVID-19”) pandemic, which started in late
2019 and reached the United States in early 2020, continues to
significantly impact the economy of the United States and the rest
of the world. While the disruption appears to be mitigating due to
the availability of vaccines and other factors, the ultimate
duration and severity of the pandemic remain uncertain,
particularly given the development of new variants that continue to
spread. The COVID-19 outbreak caused plasma center closures, and
the stimulus packages signed into law during 2020 and 2021 reduced
the incentive for individuals to donate plasma for supplementary
income. Those developments have had and will continue to have an
adverse impact on the company’s results of operations. While we
remain cautiously optimistic and have seen improvements in our
operating results on an aggregated basis, we cannot foresee how
long it may take the company to attain pre-pandemic operating
levels on a per plasma donation center basis as COVID-19 related
labor shortages at plasma donation centers, border closures, and
other effects continue to weigh on the company’s results of
operations. Given the uncertainty around the extent and timing of
the potential future spread or mitigation of COVID-19 and variants
and around the imposition or relaxation of protective measures,
management cannot at this time estimate with reasonable accuracy
COVID-19’s further impact on the company’s results of operations,
cash flows or financial condition.
First Quarter 2022 Financial Results Conference Call
Details
At 5:00 p.m. ET today, the company will host a conference call
to discuss its first quarter 2022 results. The conference call may
include forward-looking statements. The dial-in information for
this call is 877.407.2988 (within the U.S.) and 201.389.0923
(outside the U.S.). A replay of the call will be available until
August 11, 2022, and can be accessed by dialing 877.660.6853
(within the U.S.) and 201.612.7415 (outside the U.S.), using
passcode 13729568.
Forward-Looking Statements
Certain statements contained in this press release may be deemed
to be forward-looking statements under federal securities laws, and
the company intends that such forward-looking statements be subject
to the safe harbor created thereby. All statements, other than
statements of fact included in this release are forward-looking
statements. Such forward-looking statements include, among others,
that our unrestricted cash, anticipated revenues and profits will
be sufficient to sustain operations for the next 12 months; that
the expected total revenue, gross profit margins, operating
expenses, depreciation and amortization, stock-based compensation,
adjusted EBITDA, plasma revenues and pharma revenues for 2022 meet
our expectations; that the company will continue to post
year-over-year improvements; that the company’s growth prospects in
plasma, pharma, and other prepaid business materialize; and that
the company will continue to be affected by COVID-19-related labor
shortages. We caution that these statements are qualified by
important risks, uncertainties and other factors that could cause
actual results to differ materially from those reflected by such
forward-looking statements. Such factors include, among others, the
inability to continue our current growth rate in future periods;
that a downturn in the economy, including as a result of COVID-19
and variants, as well as further government stimulus measures,
could reduce our customer base and demand for our products and
services, which could have an adverse effect on our business,
financial condition, profitability and cash flows; operating in a
highly regulated environment; failure by us or business partners to
comply with applicable laws and regulations; changes in the laws,
regulations, credit card association rules or other industry
standards affecting our business; that a data security breach could
expose us to liability and protracted and costly litigation; and
other risk factors set forth in our Form 10-K for the year ended
December 31, 2021. Except to the extent required by federal
securities laws, the company undertakes no obligation to publicly
update or revise any statements in this release, whether as a
result of new information, future events or otherwise.
About Paysign, Inc.
Paysign, Inc. (NASDAQ: PAYS) is a leading provider of prepaid
card programs, comprehensive patient affordability offerings,
digital banking services and integrated payment processing designed
for businesses, consumers and government institutions. Incorporated
in 1995 and headquartered in southern Nevada, the company creates
customized, innovative payment solutions for clients across all
industries, including pharmaceutical, healthcare, hospitality and
retail. By using Paysign solutions, clients enjoy benefits such as
lower administrative costs, streamlined operations, increased
revenues, accelerated product adoption and improved customer,
employee and partner loyalty.
Built on the foundation of a robust and reliable payments
platform, Paysign’s end-to-end technologies securely enable a wide
range of services, including transaction processing, cardholder
enrollment, value loading, cardholder account management, reporting
and customer care. The modern cross-platform architecture is highly
flexible, scalable and customizable, which delivers cost benefits
and revenue-building opportunities to clients and partners.
As a full-service program manager, Paysign manages all aspects
of the prepaid card lifecycle, from card design and bank approvals,
production, packaging, distribution and personalization, to
inventory and security controls, renewals, lost and stolen cards
and card replacement. The company’s in-house, bilingual customer
care is available 24/7/365 through live agents, interactive voice
response (IVR), and two-way SMS alerts.
For more than 20 years, major pharmaceutical and healthcare
companies and multinational enterprises have relied on Paysign to
provide full-service programs tailored to their unique
requirements. The company has designed and launched prepaid card
programs for corporate rewards, employee incentives, consumer
rebates, donor compensation, clinical trials, healthcare
reimbursement payments and copay assistance.
Paysign’s expanded product offerings include additional
corporate incentive products and demand deposit accounts accessible
with a debit card. The product roadmap includes expanded offerings
into new prepaid card categories, including payroll, travel and
expense reimbursement. For more information, visit paysign.com.
Paysign, Inc.
Condensed Consolidated
Statements of Operation
(Unaudited) Three Months Ended March 31,
2022
2021
Revenues Plasma industry
$
7,394,364
$
5,383,151
Pharma industry
806,568
882,830
Other
19,707
13,447
Total revenues
8,220,639
6,279,428
Cost of revenues
3,222,390
3,447,622
Gross profit
4,998,249
2,831,806
Operating expenses Selling, general and administrative
4,640,912
3,864,986
Depreciation and amortization
679,171
595,848
Total operating expenses
5,320,083
4,460,834
Loss from operations
(321,834
)
(1,629,028
)
Other income Interest income, net
14,336
7,101
Loss before income tax provision
(307,498
)
(1,621,927
)
Income tax provision
1,897
1,600
Net loss
$
(309,395
)
$
(1,623,527
)
Net loss per share Basic
$
(0.01
)
$
(0.03
)
Diluted
$
(0.01
)
$
(0.03
)
Weighted average common shares Basic
51,818,676
50,351,971
Diluted
51,818,676
50,351,971
Paysign, Inc.
Condensed Consolidated Balance
Sheets
March 31,
December 31,
2022
2021
(Unaudited) (Audited) ASSETS Current assets
Cash
$
8,455,671
$
7,387,156
Restricted cash
64,677,683
61,283,914
Accounts receivable
3,405,867
3,393,940
Other receivables
1,019,218
1,019,218
Prepaid expenses and other current assets
1,625,631
1,242,967
Total current assets
79,184,070
74,327,195
Fixed assets, net
1,519,799
1,642,981
Intangible assets, net
4,205,833
4,086,962
Operating lease right-of-use asset
3,900,851
3,993,655
Total assets
$
88,810,553
$
84,050,793
LIABILITIES AND STOCKHOLDERS' EQUITY Current
liabilities Accounts payable and accrued liabilities
$
6,954,565
$
5,765,478
Operating lease liability, current portion
345,544
340,412
Customer card funding
64,677,683
61,283,914
Total current liabilities
71,977,792
67,389,804
Operating lease liability, long term portion
3,584,851
3,673,186
Total liabilities
75,562,643
71,062,990
Stockholders' equity Common stock: $0.001 par value;
150,000,000 shares authorized, 52,218,382 and 52,095,382 issued at
March 31, 2022 and December 31, 2021, respectively
52,218
52,095
Additional paid-in-capital
17,429,498
16,860,119
Treasury stock at cost, 303,450 shares
(150,000
)
(150,000
)
Accumulated deficit
(4,083,806
)
(3,774,411
)
Total stockholders' equity
13,247,910
12,987,803
Total liabilities and stockholders' equity
$
88,810,553
$
84,050,793
Paysign, Inc. Non-GAAP Measures
To supplement Paysign’s financial results presented on a GAAP
basis, we use non-GAAP measures that exclude from net income the
following cash and non-cash items: interest, taxes, depreciation
and amortization, stock-based compensation, impairment of
intangible asset and loss on abandonment of assets. We believe
these non-GAAP measures used by management to gauge the operating
performance of the business help investors better evaluate our past
financial performance and potential future results. Non-GAAP
measures should not be considered in isolation or as a substitute
for comparable GAAP accounting, and investors should read them in
conjunction with the company’s financial statements prepared in
accordance with GAAP. The non-GAAP measures we use may be different
from, and not directly comparable to, similarly titled measures
used by other companies.
“EBITDA” is defined as earnings before interest, taxes,
depreciation and amortization expense. “Adjusted EBITDA” reflects
the adjustment to EBITDA to exclude stock-based compensation
charges, impairment of intangible asset and loss on abandonment of
assets.
Adjusted EBITDA is not intended to represent cash flows from
operations, operating income (loss) or net income (loss) as defined
by U.S. GAAP as indicators of operating performances. Management
cautions that amounts presented in accordance with Paysign’s
definition of Adjusted EBITDA may not be comparable to similar
measures disclosed by other companies because not all companies
calculate Adjusted EBITDA in the same manner.
Paysign, Inc.
Adjusted EBITDA
(Unaudited)
Three Months Ended March
31,
2022
2021
Reconciliation of EBITDA and adjusted EBITDA to net loss: Net loss
$
(309,395
)
$
(1,623,527
)
Income tax provision
1,897
1,600
Interest income, net
(14,336
)
(7,101
)
Depreciation and amortization
679,171
595,848
EBITDA
357,337
(1,033,180
)
Stock-based compensation
569,502
636,214
Adjusted EBITDA
$
926,839
$
(396,966
)
Adjusted EBITDA per share Basic
$
0.02
$
(0.01
)
Diluted
$
0.02
$
(0.01
)
Weighted average common shares Basic
51,818,676
50,351,971
Diluted
52,521,876
50,351,971
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220511006032/en/
Paysign Investor Relations: 888.522.4810 ir@paysign.com
Paysign Media Relations: Alicia Ches Director, Marketing
702.749.7257 pr@paysign.com
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