Page | |
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS: | |
F - 3-F - 4 | |
F - 5 | |
F - 6 | |
F - 7-F - 8 | |
F - 9-F - 10 | |
F - 11-F - 15 | |
June 30 | December 31 | |||||||
2023 | 2022 | |||||||
U.S. dollars in thousands | ||||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents | 31,050 | 33,880 | ||||||
Restricted cash transferable to customers for processing activity | 50,575 | 34,119 | ||||||
Short-term bank deposits | 1,234 | 83 | ||||||
Receivables in respect of processing activity | 32,404 | 25,382 | ||||||
Trade receivable, net | 32,462 | 27,412 | ||||||
Inventory | 22,924 | 23,807 | ||||||
Other current assets | 7,215 | 5,777 | ||||||
Total current assets | 177,864 | 150,460 | ||||||
NON-CURRENT ASSETS: | ||||||||
Long-term bank deposits | 1,315 | 1,336 | ||||||
Other long-term assets | 5,196 | 2,948 | ||||||
Investment in associates | 5,837 | 6,579 | ||||||
Right-of-use assets, net | 6,340 | 7,381 | ||||||
Property and equipment, net | 5,930 | 6,668 | ||||||
Goodwill and intangible assets, net | 59,344 | 55,116 | ||||||
Total non-current assets | 83,962 | 80,028 | ||||||
TOTAL ASSETS | 261,826 | 230,488 |
F - 3 |
NAYAX LTD.
June 30 | December 31 | |||||||
2023 | 2022 | |||||||
U.S. dollars in thousands | ||||||||
LIABILITIES AND EQUITY | ||||||||
CURRENT LIABILITIES: | ||||||||
Short-term bank credit | 18,069 | 7,684 | ||||||
Current maturities of long-term bank loans | 1,033 | 1,052 | ||||||
Current maturities of loans from others and other long-term liabilities | 4,990 | 4,126 | ||||||
Current maturities of leases liabilities | 2,216 | 2,206 | ||||||
Payables in respect of processing activity | 94,846 | 63,336 | ||||||
Trade payables | 12,135 | 14,574 | ||||||
Other payables | 17,936 | 17,229 | ||||||
Total current liabilities | 151,225 | 110,207 | ||||||
NON-CURRENT LIABILITIES: | ||||||||
Long-term bank loans | 861 | 1,444 | ||||||
Long-term loans from others and other long-term liabilities | 3,606 | 7,062 | ||||||
Post-employment benefit obligations, net | 429 | 403 | ||||||
Lease liabilities | 5,058 | 5,944 | ||||||
Deferred income taxes | 691 | 793 | ||||||
Total non-current liabilities | 10,645 | 15,646 | ||||||
TOTAL LIABILITIES | 161,870 | 125,853 | ||||||
EQUITY: | ||||||||
Share capital | 8 | 8 | ||||||
Additional paid in capital | 152,648 | 151,406 | ||||||
Capital reserves | 9,880 | 9,771 | ||||||
Accumulated deficit | (62,580 | ) | (56,550 | ) | ||||
TOTAL EQUITY | 99,956 | 104,635 | ||||||
TOTAL LIABILITIES AND EQUITY | 261,826 | 230,488 |
F - 4 |
NAYAX LTD.
Six months ended June 30 | Three months ended June 30 | |||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||
U.S. dollars in thousands | ||||||||||||||||||||
Notes | (Excluding loss per share data) | |||||||||||||||||||
Revenues | 4 | 108,569 | 75,343 | 56,159 | 41,211 | |||||||||||||||
Cost of revenues | 5 | (69,838 | ) | (48,144 | ) | (35,303 | ) | (27,105 | ) | |||||||||||
Gross Profit | 38,731 | 27,199 | 20,856 | 14,106 | ||||||||||||||||
Research and development expenses | (10,106 | ) | (10,692 | ) | (4,970 | ) | (5,098 | ) | ||||||||||||
Selling, general and administrative expenses | (33,967 | ) | (29,946 | ) | (17,536 | ) | (15,121 | ) | ||||||||||||
Depreciation and amortization in respect of technology and capitalized development costs | (2,814 | ) | (2,111 | ) | (1,674 | ) | (1,066 | ) | ||||||||||||
Other expenses | - | (866 | ) | - | (866 | ) | ||||||||||||||
Share of loss of equity method investees | (741 | ) | (1,071 | ) | (383 | ) | (570 | ) | ||||||||||||
Operating loss | (8,897 | ) | (17,487 | ) | (3,707 | ) | (8,615 | ) | ||||||||||||
Finance expenses | (118 | ) | (2,357 | ) | (40 | ) | (1,499 | ) | ||||||||||||
Loss before taxes on income | (9,015 | ) | (19,844 | ) | (3,747 | ) | (10,114 | ) | ||||||||||||
Income tax expense | (485 | ) | (285 | ) | (226 | ) | (235 | ) | ||||||||||||
Loss for the period | (9,500 | ) | (20,129 | ) | (3,973 | ) | (10,349 | ) | ||||||||||||
Loss per share of the Company: | ||||||||||||||||||||
Basic and diluted loss per share | (0.288 | ) | (0.614 | ) | (0.120 | ) | (0.316 | ) |
F - 5 |
NAYAX LTD.
Six months ended June 30 | Three months ended June 30 | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
U.S. dollars in thousands | ||||||||||||||||
Loss for the period | (9,500 | ) | (20,129 | ) | (3,973 | ) | (10,349 | ) | ||||||||
Other comprehensive loss for the period: | ||||||||||||||||
Items that may be reclassified to profit or loss: | ||||||||||||||||
Exchange differences on translation of foreign operations | 109 | (489 | ) | 70 | (339 | ) | ||||||||||
Total comprehensive loss for the period | (9,391 | ) | (20,618 | ) | (3,903 | ) | (10,688 | ) |
F - 6 |
NAYAX LTD.
Share capital | Additional paid in capital | Remeasurement of post-employment benefit obligations | Other capital reserves | Foreign currency translation reserve | Accumulated deficit | Total equity | ||||||||||||||||||||||
U.S. dollars in thousands | ||||||||||||||||||||||||||||
Balance at January 1, 2023 | 8 | 151,406 | 248 | 9,503 | 20 | (56,550 | ) | 104,635 | ||||||||||||||||||||
Changes in the six months ended June 30, 2023: | ||||||||||||||||||||||||||||
Loss for the period | - | - | - | - | - | (9,500 | ) | (9,500 | ) | |||||||||||||||||||
Other comprehensive income for the period | - | - | - | - | 109 | - | 109 | |||||||||||||||||||||
Employee options exercised | * | 1,242 | - | - | - | - | 1,242 | |||||||||||||||||||||
Share-based payment | - | - | - | - | - | 3,470 | 3,470 | |||||||||||||||||||||
Balance on June 30, 2023 | 8 | 152,648 | 248 | 9,503 | 129 | (62,580 | ) | 99,956 | ||||||||||||||||||||
Balance at January 1, 2022 | 8 | 150,366 | 102 | 9,503 | 394 | (28,697 | ) | 131,676 | ||||||||||||||||||||
Changes in the six months ended June 30, 2022: | ||||||||||||||||||||||||||||
Loss for the period | - | - | - | - | - | (20,129 | ) | (20,129 | ) | |||||||||||||||||||
Other comprehensive loss for the period | - | - | - | - | (489 | ) | - | (489 | ) | |||||||||||||||||||
Employee options exercised | * | 397 | - | - | - | - | 397 | |||||||||||||||||||||
Share-based payment | - | - | - | - | - | 5,635 | 5,635 | |||||||||||||||||||||
Balance on June 30, 2022 | 8 | 150,763 | 102 | 9,503 | (95 | ) | (43,191 | ) | 117,090 |
F - 7 |
NAYAX LTD.
Share capital | Additional paid in capital | Remeasurement of post-employment benefit obligations | Other capital reserves | Foreign currency translation reserve | Accumulated deficit | Total equity | ||||||||||||||||||||||
U.S. dollars in thousands | ||||||||||||||||||||||||||||
Balance at April 1, 2023 | 8 | 151,710 | 248 | 9,503 | 59 | (60,286 | ) | 101,242 | ||||||||||||||||||||
Changes in the three months ended June 30, 2023: | ||||||||||||||||||||||||||||
Loss for the period | - | - | - | - | - | (3,973 | ) | (3,973 | ) | |||||||||||||||||||
Other comprehensive income for the period | - | - | - | - | 70 | - | 70 | |||||||||||||||||||||
Employee options exercised | * | 938 | - | - | - | - | 938 | |||||||||||||||||||||
Share-based compensation | - | - | - | - | - | 1,679 | 1,679 | |||||||||||||||||||||
Balance on June 30, 2023 | 8 | 152,648 | 248 | 9,503 | 129 | (62,580 | ) | 99,956 | ||||||||||||||||||||
Balance at April 1, 2022 | 8 | 150,460 | 102 | 9,503 | 244 | (35,217 | ) | 125,100 | ||||||||||||||||||||
Changes in the three months ended June 30, 2022: | ||||||||||||||||||||||||||||
Loss for the period | - | - | - | - | - | (10,349 | ) | (10,349 | ) | |||||||||||||||||||
Other comprehensive loss for the period | - | - | - | - | (339 | ) | - | (339 | ) | |||||||||||||||||||
Employee options exercised | * | 303 | - | - | - | - | 303 | |||||||||||||||||||||
Share-based compensation | - | - | - | - | - | 2,375 | 2,375 | |||||||||||||||||||||
Balance on June 30, 2022 | 8 | 150,763 | 102 | 9,503 | (95 | ) | (43,191 | ) | 117,090 |
F - 8 |
NAYAX LTD.
Six months ended June 30 | Three months ended June 30 | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
U.S. dollars in thousands | ||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||||
Net loss for the period | (9,500 | ) | (20,129 | ) | (3,973 | ) | (10,349 | ) | ||||||||
Adjustments to reconcile net loss to net cash provided by (used in) operations (see Appendix A) | 8,722 | 1,942 | 2,310 | (4,892 | ) | |||||||||||
Net cash used in operating activities | (778 | ) | (18,187 | ) | (1,663 | ) | (15,241 | ) | ||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||||
Capitalized development costs | (7,984 | ) | (6,131 | ) | (4,449 | ) | (3,269 | ) | ||||||||
Acquisition of property and equipment | (274 | ) | (599 | ) | (178 | ) | (410 | ) | ||||||||
Loans granted to an equity method investee | (620 | ) | - | (620 | ) | - | ||||||||||
Increase in bank deposits | (1,182 | ) | (7,048 | ) | (1,123 | ) | (370 | ) | ||||||||
Payments for acquisitions of subsidiaries, net of cash acquired | - | 440 | - | 440 | ||||||||||||
Interest received | 448 | 35 | 424 | 35 | ||||||||||||
Investments in financial assets | (97 | ) | (6,686 | ) | (97 | ) | (1,014 | ) | ||||||||
Proceeds from sub-lessee | 69 | - | 69 | - | ||||||||||||
Net cash used in investing activities | (9,640 | ) | (19,989 | ) | (5,974 | ) | (4,588 | ) | ||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||||||
Interest paid | (1,020 | ) | (261 | ) | (745 | ) | (120 | ) | ||||||||
Changes in short-term bank credit | 10,874 | - | 6,643 | - | ||||||||||||
Royalties paid in respect to government assistance plans | (67 | ) | (36 | ) | (67 | ) | (36 | ) | ||||||||
Transactions with non-controlling interests | - | (186 | ) | - | - | |||||||||||
Repayment of long-term bank loans | (502 | ) | (1,711 | ) | (248 | ) | (248 | ) | ||||||||
Repayment of long-term loans from others | (2,261 | ) | (1,568 | ) | (1,055 | ) | (626 | ) | ||||||||
Repayment of other long-term liabilities | (136 | ) | (148 | ) | (67 | ) | (73 | ) | ||||||||
Employee options exercised | 1,033 | 501 | 937 | 410 | ||||||||||||
Principal lease payments | (1,063 | ) | (656 | ) | (489 | ) | (205 | ) | ||||||||
Net cash provided by (used in) financing activities | 6,858 | (4,065 | ) | 4,909 | (898 | ) | ||||||||||
Decrease in cash and cash equivalents | (3,560 | ) | (42,241 | ) | (2,728 | ) | (20,727 | ) | ||||||||
Balance of cash and cash equivalents at beginning of period | 33,880 | 87,332 | 33,212 | 64,752 | ||||||||||||
Gains (losses) from exchange differences on cash and cash equivalents | 537 | (3,897 | ) | 424 | (2,618 | ) | ||||||||||
Gains (losses) from translation differences on cash and cash equivalents of foreign activity operations | 193 | 568 | 142 | 355 | ||||||||||||
Balance of cash and cash equivalents at end of period | 31,050 | 41,762 | 31,050 | 41,762 |
F - 9 |
NAYAX LTD.
Six months ended June 30 | Three months ended June 30 | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
U.S. dollars in thousands | ||||||||||||||||
Appendix A – adjustments to reconcile net loss to net cash provided by operations: | ||||||||||||||||
Adjustments in respect of: | ||||||||||||||||
Depreciation and amortization | 5,783 | 3,936 | 3,156 | 1,932 | ||||||||||||
Post-employment benefit obligations, net | 26 | (42 | ) | 22 | (19 | ) | ||||||||||
Deferred taxes | (72 | ) | (107 | ) | (36 | ) | (53 | ) | ||||||||
Finance expenses (income), net | (1,018 | ) | 2,988 | (807 | ) | 2,034 | ||||||||||
Expenses in respect of long-term employee benefits | 98 | 91 | 38 | 41 | ||||||||||||
Share of loss of equity method investees | 741 | 1,071 | 383 | 570 | ||||||||||||
Long-term deferred income | (52 | ) | (52 | ) | (26 | ) | (26 | ) | ||||||||
Expenses in respect of share-based compensation | 2,985 | 5,165 | 1,425 | 2,063 | ||||||||||||
Total adjustments | 8,491 | 13,050 | 4,155 | 6,542 | ||||||||||||
Changes in operating asset and liability items: | ||||||||||||||||
Decrease (Increase) in restricted cash transferable to customers for processing activity | (16,456 | ) | (9,021 | ) | (6,493 | ) | 338 | |||||||||
Increase in receivables from processing activity | (7,023 | ) | (7,965 | ) | (4,662 | ) | (2,777 | ) | ||||||||
Increase in trade receivables | (4,949 | ) | (5,851 | ) | (2,517 | ) | (4,784 | ) | ||||||||
Increase in other current assets | (238 | ) | (7,063 | ) | (1,237 | ) | (7,326 | ) | ||||||||
Decrease (Increase) in inventory | 850 | (10,208 | ) | 4,432 | (7,960 | ) | ||||||||||
Increase in payables in respect of processing activity | 31,510 | 15,645 | 15,095 | 609 | ||||||||||||
Increase (Decrease) in trade payables | (2,032 | ) | 12,106 | (4,516 | ) | 11,160 | ||||||||||
Increase (Decrease) in other payables | (1,431 | ) | 1,249 | (1,947 | ) | (694 | ) | |||||||||
Total changes in operating asset and liability items | 231 | (11,108 | ) | (1,845 | ) | (11,434 | ) | |||||||||
Total adjustments to reconcile net loss to net cash provided by (used in) operations | 8,722 | 1,942 | 2,310 | (4,892 | ) | |||||||||||
Appendix B – Information regarding investing and financing activities not involving cash flows: | ||||||||||||||||
Purchase of property and equipment in credit | 2 | 70 | 2 | 70 | ||||||||||||
Acquisition of right-of-use assets through lease liabilities | 338 | 380 | 243 | 0 | ||||||||||||
Share based payments costs attributed to development activities, capitalized as intangible assets | 485 | 470 | 254 | 312 | ||||||||||||
Recognition of receivable balance in respect of sub-lease against derecognition of right-of-use asset in respect of lease of buildings | 455 | - | 455 | - |
F - 10 |
a. | Nayax Ltd. (hereafter – the “Company”) was incorporated in January 2005. The Company provides processing and software as a service (SaaS) business operations solutions and services via a global platform. The Company is marketing its POS devices and SaaS solutions it developed in more than 60 countries worldwide (including Israel) through subsidiaries (the Company and the subsidiaries, hereafter – the “Group”) and through local distributors. |
b. | These condensed consolidated interim financial statements were approved by the Board of Directors on September 27, 2023, and should be read in conjunction with the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2022 (the “2022 Annual Report”) filed with the Securities and Exchange Commission (the “SEC”) on March 1, 2023. |
a. | The unaudited condensed consolidated interim consolidated financial statements of the Company as of June 30, 2023, and for the six-months and three-months interim periods ended on that date (hereinafter: "the Condensed Interim Financial Information") have been prepared in accordance with International Accounting Standard IAS 34, “Interim Financial Reporting”. These Condensed Consolidated Interim Financial Statements, that are unaudited, do not include all the information and disclosures that would otherwise be required in a complete set of annual financial statements and should be read in conjunction with the annual financial statements as of December 31, 2022, and their accompanying notes, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as published by the International Accounting Standards Board (“IASB”). The results of the Group and in the six -months and three-months periods ended June 30, 2023, do not necessarily provide indication of the results that can be expected in the year ended December 31, 2023. |
b. | Estimates and judgments |
F - 11 |
NAYAX LTD.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
NOTE 4 - REVENUES
Six months ended June 30 | Three months ended June 30 | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
U.S. dollars in thousands | ||||||||||||||||
Revenues from sale of integrated POS devices | 39,952 | 27,394 | 19,833 | 15,777 | ||||||||||||
Recurring revenues: | ||||||||||||||||
SaaS revenues | 27,473 | 21,172 | 14,284 | 10,825 | ||||||||||||
Payment processing fee | 41,144 | 26,777 | 22,042 | 14,609 | ||||||||||||
68,617 | 47,949 | 36,326 | 25,434 | |||||||||||||
Total | 108,569 | 75,343 | 56,159 | 41,211 |
NOTE 5 - COST OF REVENUES
Six months ended June 30 | Three months ended June 30 | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
U.S. dollars in thousands | ||||||||||||||||
Cost of integrated POS devices sales | 33,913 | 25,516 | 16,138 | 14,674 | ||||||||||||
Cost of recurring revenues | 35,925 | 22,628 | 19,165 | 12,431 | ||||||||||||
Total | 69,838 | 48,144 | 35,303 | 27,105 |
a. | As of December 31, 2022, the Company had a short-term credit facility in the amount of NIS 35 million ($10.6 million) from an Israeli bank that bears a prime based variable interest rate. In April 2023, the short-term credit facility was increased to NIS 42.5 million ($11.5 million). |
b. | In May 2023, the Company received a short-term credit facility in the amount of NIS 17 million ($4.6 million) from an Israeli bank that bears a prime based variable interest rate. |
c. | Under the two above financing agreements, the Company is required to meet certain financial covenants. As of June 30, 2023, the Company met all the covenants. |
F - 12 |
NAYAX LTD.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
a) | First Call Option - a Call Option granted to the Company to buy from BHP and Feit such number of shares that following the exercise of the First Call Option, the Company will hold 50.1% of the voting rights in IoT Technology, such that the Company will be able to consolidate the Company in its financial statements. The option can be exercised by the Company between two to eleven years from signing of the New Agreement date. As of June 30, 2023, the fair value of the First Call Option was determined to be $1,918 thousand. |
b) | Second Call Option - a Second Call Option granted to the Company to buy from BHP and Feit such number of shares that following the exercise option the Company will hold 100% from IoT Technology. The option can be exercised by the Company at any time during a period of ten years following the exercise of the First Call Option and in no event later than fourteen years from the signing of New Agreement. |
c) | Put Option - the Put Option granted by the Company to BHP and Feit to sell the remaining shares of IoT Technology. The Put Option shall be exercisable commencing at any time following the lapse of two years following the signing of the New Agreement and ending upon the lapse of the Second Call Option period. |
F - 13 |
NAYAX LTD.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
U.S. Dollars in thousands | ||||
Financial assets at fair value through profit or loss (*) | 1,918 | |||
Liability for deferred consideration | 1,500 | |||
Deferred income (**) | 418 |
(*) | The options mentioned above are measured at fair value through profit and loss. As of June 30, 2023, there has been no impact through profit on the Company's profit and loss report. |
(**) | Deferred income represents an advance for providing future services by the Company to IoT Technology. |
NOTE 7 - FINANCIAL INSTRUMENTS
Fair value of financial assets and financial liabilities
The carrying amounts of all financial assets and financial liabilities in the Company's statement of financial position reasonably approximate their fair value.
NOTE 8 - LOSS PER SHARE
a. | Basic |
Six months ended June 30 | Three months ended June 30 | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Loss for the period | (9,500 | ) | (20,129 | ) | (3,973 | ) | (10,349 | ) | ||||||||
Weighted average of number of ordinary shares | 33,023 | 32,781 | 33,075 | 32,805 | ||||||||||||
Basic loss per ordinary share | (0.288 | ) | (0.614 | ) | (0.120 | ) | (0.316 | ) |
June 30, 2023 | June 30, 2022 | |||||||
Options and unvested RSU issued as part of share-based payment | 3,737 | 3,893 |
F - 14 |
NAYAX LTD.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
Allotment date | Share price | Exercise price | Expected term | Risk-free interest rate | Average standard deviation | Fair value | ||||||||||||||||||
June 26, 2023 – Options | $ | 19.34 | $ | 18.83 | 5 | 3.96 | % | 67.8 | % | $ | 11.03 | |||||||||||||
June 26, 2023 – RSUs | $ | 19.34 | - | - | - | - | $ | 19.34 |
F - 15