Second Quarter Transactions Increased 39%
Year-over-Year Second Quarter Revenue Increased 28% Year-over-Year
Second Quarter Gross Profit Increased 24% Year-over-Year
Contribution Profit* Increased 30% Year-over-Year
Paymentus Holdings, Inc. (“Paymentus”) (NYSE: PAY), a leading
provider of cloud-based bill payment technology solutions, today
announced financial results for its second quarter ended June 30,
2022.
"Paymentus had another quarter of strong growth driven by an
increase in transaction volume of over 39%." said Dushyant Sharma,
Founder and CEO. "We continue to see strong momentum in sales
growth, crossing 125 deals closed in 2022."
Second Quarter 2022 Business and
Financial Highlights*
- Processed 89.5 million transactions in the second quarter of
2022, an increase of 39.4% from the second quarter of 2021.
- Revenue was $120.0 million, an increase of 28.3% from the
second quarter of 2021.
- Gross profit was $35.8 million compared to $28.9 million for
the second quarter of 2021. Adjusted gross profit was $38.7 million
compared to $30.1 million for the second quarter of 2021.
- Contribution profit was $48.7 million, compared to $37.4
million for the second quarter of 2021, representing an increase of
30.1%.
- Net loss was $2.5 million and GAAP loss per share was $0.02.
Non-GAAP net loss was $0.4 million and non-GAAP loss per share was
$0.00.
- Adjusted EBITDA was $5.0 million, representing a 10.3% adjusted
EBITDA margin compared to $8.3 million, representing a 22.2%
adjusted EBITDA margin, for the second quarter of 2021.
"Our contribution profit grew over 30% as we continued to see
strong transaction growth," said Matt Parson, CFO. "As we look at
the second half of the year, we anticipate expanding our adjusted
EBITDA margins as we begin to see more benefits from the scale we
have established."
* Descriptions of the non-GAAP financial measures contribution
profit, adjusted gross profit, adjusted EBITDA, adjusted EBITDA
margin, non-GAAP net income (loss) and non-GAAP earnings per share
are provided below under “Use and Definitions of Non-GAAP Financial
Measures,” and reconciliations are provided in the tables at the
end of this release.
Updated 2022 Financial
Outlook
Paymentus expects revenue for the full year 2022 to be between
$485 million and $492 million or approximately 25% to 27% growth
year-over-year. Contribution profit is anticipated to be between
$200 million and $204 million or 26% and 29% growth
year-over-year(1). Adjusted EBITDA is expected to be between $25
million and $28.5 million, resulting in an expected adjusted EBITDA
margin of approximately 13% to 14%.
(1) Gross profit is estimated to be approximately 72% of
contribution profit and other cost of revenue is estimated to be
approximately 28% of contribution profit. The decrease in GAAP
gross profit for 2022 is primarily driven by amortization of
acquired intangibles, as such this will not impact adjusted gross
profit.
Paymentus does not reconcile its forward-looking guidance for
non-GAAP measures because certain financial information, the
probable significance of which cannot be determined, is not
available and cannot be reasonably estimated. Refer to “Use of
Forward-Looking Non-GAAP Measures” below for additional
explanation. The statements in this section are forward-looking
statements. For additional information regarding the use and
limitations of such statements, refer to “Forward-Looking
Statements” below.
Conference Call Information
In conjunction with this announcement, Paymentus will host a
conference call for investors at 2:00 p.m. PT (5:00 p.m. ET) today
to discuss second quarter 2022 results and our outlook for 2022.
The live webcast and replay will be available at the Investor
Relations section of Paymentus’ website.
About Paymentus
Paymentus is a leading provider of cloud-based bill payment
technology and solutions for more than 1,700 billers and financial
institutions across North America. Our omni-channel platform
provides consumers with easy-to-use, flexible and secure electronic
bill payment experiences through their preferred payment channel
and type. Paymentus’ proprietary Instant Payment NetworkTM, or IPN,
extends our reach by connecting our IPN partners’ platforms and
tens of thousands of billers to our integrated billing, payment,
and reconciliation capabilities. For more information, please visit
www.paymentus.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 and the Private
Securities Litigation Reform Act of 1995. All statements other than
statements of historical or current fact included in this press
release are forward-looking statements, including but not limited
to statements regarding our ability to expand our adjusted EBITDA
margins, our future financial performance and our updated 2022
financial outlook. Forward-looking statements include statements
containing words such as “expect,” “anticipate,” “believe,”
“project,” “will” and similar expressions intended to identify
forward-looking statements.
These forward-looking statements are based on our current
expectations. Forward-looking statements involve risks and
uncertainties. Our actual results and the timing of events could
differ materially from those anticipated in such forward-looking
statements as a result of these risks and uncertainties, which
include, without limitation, risks related to our ability to
effectively manage our growth and expand our operations, including
into new channels and industry verticals across different markets;
our ability to expand and retain our biller, financial institution,
partner and consumer base; the continued impact of the COVID-19
pandemic on our operating results, liquidity and financial
condition and on our employees, billers, financial institutions,
partners, consumers and other key stakeholders; our ability to
remain competitive; our ability to develop new product features and
enhance our platform and brand; our future acquisitions and
strategic investments; our ability to hire and retain experienced
and talented employees; and other risks and uncertainties included
under the caption “Risk Factors” and elsewhere in our filings with
the Securities and Exchange Commission, or SEC, including, without
limitation, our Annual Report on Form 10-K for the year ended
December 31, 2021, filed with the SEC on March 3, 2022 and our
Quarterly Report on Form 10-Q for the quarter ended June 30, 2022,
which we expect to file with the SEC in early August 2022. You are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press
release.
All forward-looking statements are qualified in their entirety
by this cautionary statement, and we undertake no obligation to
revise or update any forward-looking statements to reflect events
or circumstances after the date hereof.
Use of Forward-Looking Non-GAAP Measures
Paymentus does not meaningfully reconcile guidance for adjusted
EBITDA and adjusted EBITDA margin, because Paymentus cannot provide
guidance for the more significant reconciling items between net
income and adjusted EBITDA without unreasonable effort. This is due
to the fact that future period non-GAAP guidance includes
adjustments for items not indicative of our core operations, which
may include, without limitation, items included in the supplemental
financial information for reconciliation of reported GAAP results
to non-GAAP results. Such items include acquisition related
amortization expense for acquired intangibles, foreign exchange
gains and losses, adjustments to its income tax provision and
certain other items Paymentus believes to be non-indicative of its
ongoing operations. Such adjustments may be affected by changes in
ongoing assumptions, judgements, as well as nonrecurring, unusual
or unanticipated charges, expenses or gains/losses or other items
that may not directly correlate to the underlying performance of
our business operations. The exact amount of these adjustments is
not currently determinable but may be significant.
Use and Definitions of Non-GAAP Financial Measures
In addition to disclosing financial measures in accordance with
accounting principles generally accepted in the United States, or
GAAP, this press release and the accompanying tables contain
certain non-GAAP financial measures, including contribution profit,
adjusted gross profit, adjusted EBITDA, adjusted EBITDA margin,
free cash flow, non-GAAP net income and non-GAAP earnings per
share, or EPS. We use non-GAAP measures to supplement financial
information presented on a GAAP basis. We believe that excluding
certain items from our GAAP results allows management and our board
of directors to more fully understand our consolidated financial
performance from period to period and helps management project our
future consolidated financial performance as forecasts are
developed at a level of detail different from that used to prepare
GAAP-based financial measures.
Contribution profit is defined as gross profit plus other
cost of revenue. Other cost of revenue equals cost of revenue less
interchange and assessment fees paid by us to our payment
processors.
Adjusted gross profit is defined as gross profit adjusted
for non-cash items, primarily stock-based compensation and
amortization.
Adjusted EBITDA is defined as net income before other
income (expense) (which consists of interest income (expense), net
and foreign exchange gain (loss)), depreciation and amortization
and income taxes, adjusted to exclude the effects of stock-based
compensation expense and certain nonrecurring expenses that
management believes are not indicative of ongoing operations,
consisting primarily of professional fees and other indirect
charges associated with our initial public offering.
Adjusted EBITDA margin is defined as adjusted EBITDA as a
percentage of contribution profit.
Free cash flow is defined as net cash provided by (used
in) operating activities less capital expenditures and software and
capitalized internal-use software development costs.
Non-GAAP net (loss) income and non-GAAP EPS are
defined as net (loss) income excluding certain nonrecurring items
such as discrete tax items, one-time expenses or other non-cash
items, including amortization of acquisition-related
intangibles.
We believe these non-GAAP measures provide our investors with
useful information to help them evaluate our operating results by
facilitating an enhanced understanding of our operating performance
and enabling them to make more meaningful period-to-period
comparisons. In particular, we exclude interchange and assessment
fees in the presentation of contribution profit because we believe
inclusion is less directly reflective of our operating performance
as we do not control the payment channel used by consumers, which
is the primary determinant of the amount of interchange and
assessment fees. We use contribution profit to measure the amount
available to fund our operations after interchange and assessment
fees, which are directly linked to the number of transactions we
process and thus our revenue and gross profit.
We use these non-GAAP measures in conjunction with GAAP measures
as part of our overall assessment of our performance and liquidity,
including the preparation of our annual operating budget and
quarterly forecasts, to evaluate the effectiveness of our business
strategies, and to communicate with our board of directors
concerning our financial performance and liquidity. There are
limitations to the use of the non-GAAP measures presented in this
press release. Our non-GAAP measures may not be comparable to
similarly titled measures of other companies; other companies,
including companies in our industry, may calculate non-GAAP
measures differently than we do, limiting the usefulness of those
measures for comparative purposes. These non-GAAP measures should
not be considered in isolation from or as a substitute for
financial measures prepared in accordance with GAAP.
We encourage investors and others to review our financial
information in its entirety, not to rely on any single financial
measure, and to view our non-GAAP measures in conjunction with GAAP
financial measures. For a reconciliation of these non-GAAP
financial measures to GAAP measures, please see the tables for the
reconciliation of GAAP to non-GAAP results included at the end of
this release.
PAYMENTUS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS (Unaudited)
(In thousands, except share and
per share data)
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
Revenue
$
119,969
$
93,495
$
236,673
$
185,717
Cost of revenue
84,141
64,567
165,991
129,242
Gross profit
35,828
28,928
70,682
56,475
Operating expenses
Research and development
10,185
7,921
20,575
15,651
Sales and marketing
17,851
9,505
34,041
17,727
General and administrative
10,017
7,421
19,662
14,163
Total operating expenses
38,053
24,847
74,278
47,541
(Loss) income from operations
(2,225
)
4,081
(3,596
)
8,934
Other income (loss)
Interest income (expense), net
98
(4
)
90
(7
)
Foreign exchange gain (loss)
54
(1
)
80
8
(Loss) income before income taxes
(2,073
)
4,076
(3,426
)
8,935
(Provision for) benefit from income
taxes
(378
)
(3,501
)
2,693
(4,722
)
Net (loss) income
$
(2,451
)
$
575
$
(733
)
$
4,213
Undeclared dividends on Series A preferred
stock
—
(898
)
—
(2,258
)
Net (loss) income attributable to common
stock
$
(2,451
)
$
(323
)
$
(733
)
$
1,955
Net (loss) income per share attributable
to common stock
Basic
$
(0.02
)
$
—
$
(0.01
)
$
0.02
Diluted
$
(0.02
)
$
—
$
(0.01
)
$
0.02
Weighted-average number of shares used to
compute net (loss) income per share attributable to common
stock
Basic
121,637,711
108,970,604
121,269,688
106,240,091
Diluted
121,637,711
108,970,604
121,269,688
112,244,054
PAYMENTUS HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS (Unaudited)
(In thousands, except share and
per share data)
June 30,
December 31,
2022
2021
Assets
Current assets
Cash and cash equivalents
$
158,335
$
168,386
Restricted funds held for financial
institutions
59,325
33,443
Accounts and other receivables, net of
allowance of $284 and $102
52,908
43,935
Income tax receivable
2,661
2,488
Prepaid expenses and other current
assets
8,611
8,184
Total current assets
281,840
256,436
Property and equipment, net of accumulated
depreciation and amortization of $5,353 and $4,791
2,048
2,044
Capitalized internal-use software
development costs, net
38,725
30,888
Intangible assets, net
38,108
42,088
Goodwill
129,387
129,413
Operating lease right-of-use assets
10,711
7,703
Deferred tax asset
167
163
Other long-term assets
5,176
4,207
Total assets
$
506,162
$
472,942
Liabilities and Stockholders’
Equity
Current liabilities
Accounts payable
$
27,789
$
24,748
Accrued liabilities
14,564
12,491
Financial institution funds in-transit
59,325
33,443
Operating lease liabilities
1,559
1,456
Contract liabilities
1,323
2,173
Income tax payable
494
122
Total current liabilities
105,054
74,433
Deferred tax liability
—
3,318
Operating leases, net of current
portion
9,546
6,463
Contract liabilities, net of current
portion
2,640
1,713
Finance leases and other finance
obligations, net of current portion
750
883
Total liabilities
117,990
86,810
Commitments and contingencies (Note 9)
Stockholders’ equity
Preferred stock, $0.0001 par value per
share, 5,000,000 authorized at June 30, 2022 and December 31, 2021,
respectively, none issued and outstanding at June 30, 2022 and
December 31, 2021, respectively
—
—
Class A common stock, $0.0001 par value
per share, 883,950,000 shares authorized as of June 30, 2022 and
December 31, 2021, respectively; 19,283,807 and 17,251,079 shares
issued and outstanding as of June 30, 2022 and December 31, 2021,
respectively
2
1
Class B common stock, $0.0001 par value
per share, 111,050,000 shares authorized as of June 30, 2022 and
December 31, 2021, respectively; 103,336,337 and 103,388,082 shares
issued and outstanding as of June 30, 2022 and December 31, 2021,
respectively
10
11
Additional paid-in capital
358,939
356,017
Accumulated other comprehensive income
19
168
Retained earnings
29,202
29,935
Total stockholders’ equity
388,172
386,132
Total liabilities and stockholders'
equity
$
506,162
$
472,942
PAYMENTUS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS (Unaudited)
(In thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
Cash flows from operating
activities
Net (loss) income
$
(2,451
)
$
575
$
(733
)
$
4,213
Adjustments to reconcile net income to net
cash provided by operating activities
Depreciation and amortization
5,886
2,548
11,360
4,940
Deferred income taxes
(4,728
)
1,656
(3,322
)
2,413
Stock-based compensation
1,344
568
2,620
1,131
Non-cash lease expense
365
857
1,120
1,648
Amortization of contract asset
351
177
818
177
Provision for credit losses
92
—
187
—
Change in operating assets and
liabilities
Accounts and other receivables
(1,123
)
652
(9,205
)
(4,944
)
Prepaid expenses and other current and
long-term assets
(749
)
(828
)
(910
)
(905
)
Accounts payable
(1,711
)
(1,229
)
3,205
3,541
Accrued liabilities
1,753
610
2,615
543
Operating lease liabilities
(172
)
(848
)
(942
)
(1,573
)
Contract liabilities
132
(582
)
75
301
Income taxes receivable, net of
payable
4,855
1,424
204
1,272
Net cash provided by operating
activities
3,844
5,580
7,092
12,757
Cash flows from investing
activities
Other intangible assets acquired
(100
)
—
(123
)
—
Purchases of property and equipment
(265
)
(408
)
(795
)
(564
)
Capitalized internal-use software
development costs
(7,733
)
(4,480
)
(14,464
)
(8,736
)
Net cash used in investing activities
(8,098
)
(4,888
)
(15,382
)
(9,300
)
Cash flows from financing
activities
Proceeds from initial public offering, net
of underwriter's discounts and commissions
—
224,595
—
224,595
Proceeds from private placement
—
50,000
—
50,000
Redemption of Series A preferred stock
—
(23,013
)
—
(23,013
)
Payment of dividends on Series A preferred
stock
—
(34,412
)
—
(34,412
)
Proceeds from repayment of related party
loan
—
—
—
813
Proceeds from exercise of stock
options
289
—
302
—
Financial institution funds in-transit
22,543
—
25,882
—
Payments of deferred offering costs
—
(399
)
—
(856
)
Payments on other financing
obligations
(916
)
(384
)
(1,831
)
(767
)
Payments on finance leases
(61
)
(68
)
(135
)
(136
)
Net cash provided by financing
activities
21,855
216,319
24,218
216,224
Foreign currency effect on cash, cash
equivalents and restricted cash
(107
)
10
(97
)
43
Net increase in cash, cash equivalents and
restricted cash
17,494
217,021
15,831
219,724
Cash, cash equivalents and restricted
cash
Beginning of period
200,166
49,369
201,829
46,666
End of period
$
217,660
$
266,390
$
217,660
$
266,390
PAYMENTUS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS (continued) (Unaudited)
(In thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
The below table reconciles cash, cash
equivalents and restricted cash in the condensed consolidated
balance sheets to the total of the same amounts shown in the
condensed consolidated statements of cash flows:
Cash and cash equivalents
$
158,335
$
266,390
$
158,335
$
266,390
Restricted funds held for financial
institutions
59,325
—
59,325
—
Total cash, cash equivalents and
restricted cash as shown in the condensed consolidated statements
of cash flows
$
217,660
$
266,390
$
217,660
$
266,390
The following tables set forth our non-GAAP financial measures
with reconciliations to the most directly comparable GAAP financial
measures:
Contribution Profit
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in thousands)
Gross profit
$
35,828
$
28,928
$
70,682
$
56,475
Plus: other cost of revenue
12,896
8,513
25,427
16,075
Contribution profit
$
48,724
$
37,441
$
96,109
$
72,550
Adjusted Gross Profit
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in thousands)
Gross profit
$
35,828
$
28,928
$
70,682
$
56,475
Stock-based compensation
—
—
—
—
Amortization
2,879
1,164
5,389
2,212
Adjusted gross profit
$
38,707
$
30,092
$
76,071
$
58,687
Adjusted EBITDA and Adjusted EBITDA Margin
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in thousands)
Net (loss) income
$
(2,451
)
$
575
$
(733
)
$
4,213
Excluding
Interest (income) expense, net
(98
)
4
(90
)
7
Provision for (benefit from) income
taxes
378
3,501
(2,693
)
4,722
Depreciation and amortization
5,886
2,548
11,360
4,940
Foreign exchange (gain) loss
(54
)
1
(80
)
(8
)
Stock-based compensation
1,344
568
2,620
1,131
Other nonrecurring expenses(1)
—
1,115
—
2,711
Adjusted EBITDA
$
5,005
$
8,312
$
10,384
$
17,716
Adjusted EBITDA margin
10.3
%
22.2
%
10.8
%
24.4
%
(1) Other nonrecurring expenses consist of indirect costs
incurred associated with our IPO.
Free Cash Flow
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in thousands)
Net cash provided by operating
activities
$
3,844
$
5,580
$
7,092
$
12,757
Purchases of property and equipment and
software
(365
)
(408
)
(918
)
(564
)
Capitalized internal-use software
development costs
(7,733
)
(4,480
)
(14,464
)
(8,736
)
Free cash flow
$
(4,254
)
$
692
$
(8,290
)
$
3,457
Net cash used in investing activities
$
(8,098
)
$
(4,888
)
$
(15,382
)
$
(9,300
)
Net cash provided by financing
activities
$
21,855
$
216,319
$
24,218
$
216,224
Non-GAAP Net (Loss) Income
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in thousands)
Net (loss) income
$
(2,451
)
$
575
$
(733
)
$
4,213
Excluding amortization of
acquisition-related intangibles
2,007
—
4,014
—
Non-GAAP net (loss) income
$
(444
)
$
575
$
3,281
$
4,213
Non-GAAP EPS
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in thousands, except share
and per share data)
Net (loss) income attributable to common
shareholders
$
(2,451
)
$
(323
)
$
(733
)
$
1,955
Excluding amortization of
acquisition-related intangibles
2,007
—
4,014
—
Excluding undeclared dividends on Series A
preferred stock
—
898
—
2,258
Numerator for Non-GAAP EPS - basic
$
(444
)
$
575
$
3,281
$
4,213
Weighted-average shares of common stock -
basic
121,637,711
108,970,604
121,269,688
106,240,091
Non-GAAP EPS - basic
$
—
$
0.01
$
0.03
$
0.04
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220803005840/en/
Investor Relations Paul Seamon pseamon@paymentus.com
Media Relations Tony Labriola tony@thinkinsideout.com
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