GPN - Earnings call transcript Q2 2022

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Global Payments Second Quarter 2022 Earnings Conference Call. [Operator Instructions] And as a reminder, today's conference will be recorded. At this time, I would like to turn the conference over to your host, Senior Vice President, Investor Relations, Winnie Smith. Please go ahead.

Winnie Smith

Good morning, and welcome to Global Payments second quarter 2022 conference call.

the the accompany our Investor www.globalpayments.com. and be call website release on found Relations earnings slides this that can at Our area of

risks, we and call impact between EVO contain that and statements including about, proposed remind uncertainties made Before conditions you recent in the transaction forth results matters, Global management and on future forward-looking like and XX-K Payments. expected statements other are to operations in the expectations. of not materially Certain inherent the operating by We conference and reliance undue of place most set subject differ results factors, These comments are you filings statements. today's during among I'd actual subsequent begin, filings. financial Payments cause to some with on other our statements our COVID-XX to about and business these factors risk the economic that SEC, caution to from our could including

this during as obligation this and call only statements Forward-looking of no update them. we to the call, undertake date speak

referring be ongoing to performance. non-GAAP which we financial also believe of are will We our measures, more reflective several

filed Relations reconciliation the most morning SEC our on in measures non-GAAP our the call to this and furnished as accordance available this release press our of materials Investor our the For financial X-K regulations, to website. full comparable a Form in of measure see supplemental GAAP discussed with section please exhibit an

Sloan, Vice and COO; Josh Executive and are Joining President me and on Whipple, the CEO; Cameron President Jeff Bready, call CFO. Senior

to over call turn Now, I'll the Jeff.

Jeff Sloan

trusted today. senior Payments years, at Josh in who new through leading has a Global significant role building Josh of guiding has that the a in He's our CFO, played company Thanks, been to business the Whipple, worldwide is X.X a welcome history. call our our software-driven Winnie. milestones most partner technology-enabled some key us payments for today. leader a We

Todd Global his successful the We XX critical in all Paul and he in adjusted divestiture X for headwinds. thank were across has over We at the issuer years business. our terrific years Paul his of financial and wish Payments segments merchant past Russian role metrics history self-evident key our We in also retirement. TSYS the the quarter best played the best our delivered despite the our results basis of Both on currency-neutral expectations TSYS. exceeded partnership that the post merger and second incremental and a our

and revenue lead on issuer our with multiple exactly executing Importantly, our moat. new our better at our sequential improvement basis achieved these basis, would, our strategy, extending our align key a to transactions and as And of we comparable said record partnership, business while points it a results competitive remains generated XXX levels. we getting businesses pipeline deepening

BXB, software delighted entered expanding existing we're further our that enhancing Payments, definitive our we've markets, and world-wide, presence EVO geographies, to payments First, and our faster significantly business-to-business, increasing into augmenting solutions. scaling target markets in announce integrated a leadership new growth acquire in agreement in to payment our addressable

Specifically, Mexico, including EVO existing such and Spain the of Chile in and new U.K. It Canada. with as and course, Greece. presence geographies Germany, in our provides and a scale markets, enhances attractive the us U.S. Poland,

successful to our accounts that for complement investor our to of target ERP including September, brings partners growth. At with fall. a future opportunities we the as announced last leading the with receivable EVO addressable capabilities software which our offerings, segment our providing substantially many payable meaningfully integrations, conference tremendous MineralTree last include markets under-penetrated, strategy, our fourth pillar and and remains augmented enterprise BXB key acquisition expanding of newest adds solutions. And we technology significantly and accounts BXB it BXB, For of us largest

This one As technology then, and we largest companies post the positioned effectively our TSYS we as compete need card massive data the access merger financial the technologies in with and already partnerships on rails. BXB commercial a at distribution market-leading and analytics, footprint, technology said scale. we assets card to leading world's vast of solutions, distribution and to centered have includes BXB globally payroll institutions, virtual non-card-based globally

approvals. Our more is on plan. last opportunity of how receivables business, EVO business quarter delighted later lookout creation a Payments. transaction SaaS welcome expressing corollary me EVO Cameron with I missing grew now details for let us by expected EVO the combining breakeven that course, shareholder Payments. provided team value BXB will an to quarter XXXX, provides provide in complete now to MineralTree Global in The offerings. operating to EVO no start members first that XX% than of of on cloud acquisition We believe link. Global of at the and am go-to-market with We've and, to is October which been the payable close second leading regulatory EBITDA accounts the to But tremendous our accounts ahead subject

to a investment Lake, Payments Global in in global billion investing, leader the form $X.X thrilled the senior technology we convertible strategic Second, announce are notes. of in Silver has unsecured committed

strategy from wisdom a Silver leading the amount A we will Lake and role distinguished our this payments in Lake's our commitment This and largest partner senior Global new As of in by of over expression by beneficiary has distinctiveness of Board confidence payments. winner the companies, growth, track long Payments in of cycle. the our as their an partnership join the the proof are our and an Lake of and confidence their humbled digital further innovation us Directors. Silver as driver in payments ecosystem position as is technology-driven of successful far investments outstanding Silver record leadership history. in serves the and of digital model, of in long-term sustainability

We company we that are very proud of the keep.

businesses search billion like and capital with organic growth Worldwide strategy portfolio our Third, consumer and margin our enhancing $X from while to simultaneously our we a further agreement definitive NetSpend's characteristics. align to reached Rev sell to

with As attractive between an set traditional time, our and review customer direct-to-consumer strategic of portfolio profile, at its overlap base we the corporate is there we announced a limited solutions in clients. but said favorable is NetSpend's the February,

Global expected, normalized we segment second our with Netspend's growth in retain As which be strong beginning Solutions assets, delivered quarter. and the very in We're will Issuer mid-teens will quarter BXB included our all of third positioned new is have value this of ownership. proud for and that in well we the confidence accomplished future part members business our have NetSpend team as every Payments, under

the of approvals. of revenue, in by with expect provided Solutions, transaction EVO important BXB We earnings XX%. and close comprising Post the represent subject will The of Merchant provides with quarter including confidence us these raised is acquisition transactions approximately at margin and assets, cycle our conference investor to completion end revenue then guidance NetSpend XX% the the roughly XXXX, heightened first we and to The of Netspend's Solutions this Cameron? regulatory net that last Issuer of sale, bright. indeed our September. future for adjusted

Cameron Bready

good Thanks, and Jeff, morning, everyone.

Europe BXB to operate. greater faster-growth expands our reach. position North which of acquisition software distribution our and additional provides technology payments Our extensive overseas, enhancing geographies and with technology-enabled EVO overarching markets in the unmatched our our while and exposure in and with scale we solutions. company America significantly transaction strategy, already The strategy in integrated furthers global scale our EVO as aligns payments preeminent perfectly payment also reinforcing and

financial integrations As our distribution leveraging and solutions X,XXX as relationships product X.X capabilities. positioned value distinctive locations base our complement vertical portfolio software a deliver over combined market retail software as payment EVO institutions and markets. additional over merchant to to enablement over X,XXX targeted commerce and offerings, company, that avenues an of our partners ISV solutions partner EVO globally customer of see for markets. across our extensive also bring the significant platforms leading than at restaurant We vertical opportunity our we and to unique to including further unmatched our X,XXX us point-of-sale provides XX-plus integration partners and software vertical EVO's by has well Today, are million uniquely suite distribute technology combined and to more globally.

we later and example, U.K., we Vital bringing are markets to year. POS the already with Europe including Spain key where overlap international For Central this our solutions EVO,

of value payment to BXB be solutions platform our on capitalize multinational their EVO's over enterprise in capabilities, to unified With augment and virtual full are and software and expand its accounts existing automation further payable receivable BXB our customers. physical multinational virtually, uniquely proposition will across automation with existing XX to offerings. geographies. suite significantly e-commerce our in customers over the to accounts to distinctive other able out commerce BXB transact provide and capabilities XXX we rounding positioned EVO's requirements seamlessly and and countries ability blending of our markets EVO's we Additionally, solutions, presence globally physical omnichannel

to us the Pay Fabric we delivering frictionless solutions environments in Importantly, management that to suppliers used in and business trillion Acumatica some suppliers. positioning its excess share costs of BXB EVO array and and critical most platform, SAP, automation are spend and EVO, Microsoft, address integrations Together in TAM gain $XXX annually. better with products integrations for brings process Oracle, Sage. us These to including to necessary widely the extensive efficiency the through improve the and proprietary market buyers unparalleled vast with an have the a market employers, needs of buyers, of of ERP

Virgin around that and drive are which we deliver many our Poland, our through to TSYS, and can differentiated Spain is and XX have with In our Putting and us relationships attractive marquee globally Greece and solutions strong with of institutions, it with business including optimization significantly U.K., secular the largest Since creating in underlying strong a leverages leading Chile geographies U.S., by and scale our acquiring a EVO's strategy the increases Mexico, trends demonstrated expands issuer region. Money new The Finally, globally. examples. highly with cloud-based our the in issuing to and opportunities Republic, delivered capabilities, complementary our marrying, EVO the and and significant EVO acquisition countries EVO the merger transaction be all solutions, cross-sell scale number AWS. which have collaboration together, growth for including in fundamentals. opportunities growth world presence additional Europe, Czech our with our particularly financial existing has we markets, are achieved XX there to in of also in presence have increase total, partnerships Caixabank distribution of Ireland,

streamlining we operations meaningful catalyzing generate enhance million partnership, Solutions $XXX expect Merchant substantial least run discussed in revenue from through within operational our support scale efficiencies. transaction. go-to-market eliminating infrastructure, of expect realizing strategies, we years of rate X technology Combined, corporate the at in synergies structures and As duplicative Further, to and aligning also EBITDA we prospects worldwide. the post-closing business our business primarily I've growth opportunities to this further synergies already, see cost

noted, the turn to the Josh. markets Jeff over I Global a our worldwide. EVO As presents customers We look attractive opportunity forward differentiated members to that, will value while to welcoming and payment creation advancing solutions technology the further strategy to Payments. With significant across acquisition of team call its deliver and EVO to most

Josh Whipple

with second from expectations adverse exceeded rates. Thanks, Cameron. currency foreign performance our exchange We're exit pleased the ongoing and concerns, of our financial quarter, despite which headwinds the Russian our business macro strong in incremental

Specifically, we from net revenue a and basis. an X% $X.XX delivered year increase prior on billion, the adjusted constant X% currency of growth of

operating Adjusted assets. consumer constant basis consumer for constant of currency a a point the as grew income the operating basis on basis. currency now available basis XXX Adjusted NetSpend was acquisitions. XXX adjusted second NetSpend quarter points, be or excluding a from for net XX% the the of assets, approximately increased XX% held and impact Excluding on which XXXX revenue will sale, XX.X%, margin improvement quarter XX% excluding

a basis. consumer Netspend prior adjusted Solutions increase adjusted at $X.XX, Russian business XX.X%. year of constant the Notably, ahead despite of XX% net the billion Taking currency closer by our margin achieved our for on per from revenue a of an share prior or improvement result adjusted was XX.X% from an XX% currency margin assets, in XX% year from operating increase look a Excluding in operating of basis. adjusted net the our XX% The of on quarter. segment, performance of earnings or Merchant year-on-year. points quarter, delivered was basis an segment. an XXX our we exit second the constant this the expectations $X.XX

led payments quarter, Our integrated integrated which delivered payroll reported our by and mid-teens channel, combined again strong U.S. and growth. another business

POS XX%. our quarter, to XX% continue grew momentum also HCM which and We see in our roughly strong and business, software payroll which solutions, this grew

our the this ahead Our customers. commerce expanded trends across that last that success unified reported now of acquiring To networks resonate to the business end, are our in worldwide with delivered currency well by e-commerce with Asia of America we in relationship the and constant as following growth year. the Pacific have to platform omnichannel North mid-teens launch quarter, late UCP Google our excited we continues

also retailer, we omnichannel Aldo, partnerships global Delaware with quarter, and North. new hospitality This signed multinational company,

solution, vertical across and market overall portfolio delivered growth the strong for our prior the were we compared that As pleased XX% to remain bookings trends portfolio. year revenue the

see events our stadium and Canadian We strong service and record Jets and TouchNet, Life the and Center in to continue the Winnipeg food the of produced new including and the Further, momentum, bookings performance of strong sales continued XXXX. AdvancedMD Miss management half vertical. from to kiosk offerings new for for Xenial wins in latter demand mobile increased first University realize which Ole customers with

with currency and our announce across excited a growth milestone signed achieving with results local capabilities. particularly Europe. accelerate recently quarter relationship issuing acquiring strong combining U.K., I'm Virgin and saw also that our Central to Money, strategic our international merchant in significant referral this the alliance businesses We we Spain in

this growth on of a excluding down MineralTree. XXXX, revenue, Our in long-term a points, currency reported of adjusted impact X% improvement with our the operating On basis the delivered increased year. quarter adjusted from was Issuer XX the of Solutions basis a for consistent $XXX XX.X% from points it prior expectations segment. business second basis constant basis, million Issuer XX net margin and target

accelerating growth the from nearly and increased throughout commercial growth mid-single-digit growth account XX% digits. grew double volumes revenue improving file transaction quarter. in on Notably, achieved the low first the card Our with period.

We converted long-standing XX portfolio by GAAP million was partner, late our last the also approximately of accounts, year. which Barclays, purchased

a we enter announcement South quarter, America, market. business BIG Brazil we of Grupo provide including in following the a today's EVO. the expenditures During This will another with From its market-leading for converting free region. contract the acquisition adjusted roughly expenditures prior to quarter with we the long-term the recently, with [SyncOnSet], and adjusted Chilean our of $XXX million flow of and million full free earnings flow the XXX% we in standpoint, delivered further long-term clients, flow continue in And acquisition to our cash year. for roughly quarter, cash signed target in expect outlook. our during consistent agreement signed $XXX cash of million adjusted We Carrefour $XXX for invested for extensions capital of portfolio to multiple opportunities more retailer with the in capital XXXX

just X.X On the $XXX approximately million. front, repurchased shares capital allocation we million our for quarter of over this

and sheet of healthy, of period a balance the billion extremely on net and roughly debt we with remains basis. Our liquidity leverage ended $X.X X.Xx

the $X representing EVO a form convertible As detail, approximately Silver billion. per Cameron $X.X in entered definitive of billion Jeff will and in as from banks. price Payments committed cash source in agreement X%, will serve funding acquire our $XX a we placed to of our senior in conversion Lake convertible discussed Payments and share of bridge privately of cash, term have a Global X-year facility enterprise for invest have $XXX.XX. value an a of note notes, together with The a will coupon which

as conversion call overlay we significantly expect convertible addition, premium. raise a spread to instruments, effective is In to customary with the execute

as their the strong a underscores their Payments. ahead new Lake long-term to investment opportunity commitment and their Silver We are in Global excited very have partner for and belief

entered Worldwide billion. and agreement assets sell Rev NetSpend's Searchlight for $X definitive into Additionally, we to consumer to a Capital

first to We the of close the transaction end the also by expect NetSpend quarter XXXX. of

expect at close. of leverage our be these net to X.Xx transactions, approximately we Following both

year to substantial levels, end September. the last at investor of current calendar generation We the cash expect highlighting our by to back be free we XXXX discussed flow leverage our conference

maintain We expect our investment-grade current to ratings.

in M&A. from remain We and over revenue FX the currency be trends is adjusted impacts growth Adjusted Turning constant This the a expected be currency to the our outlook prior on operating adjusted On year excess we a with range before excluding expectations constant a year. of to to to business for XXXX. foreign to up May reflecting share from net XXX and we a bringing basis in On range points outlook remainder be reflecting of from total we of $X.XX are growth XX% our of XXXX. raising are our full the outlook expect to point points. XX% expect XXXX, of basis outlook seeing XXXX. XXX underlying This expansion year prior the earnings margin to consistent $X.XX XXX by $X.XX, unchanged, billion XXX up in the currency of consistent of we in incremental remains are XX% XX% is over per a for billion dispositions to headwind basis, our an to to call. also to of to reported to encouraged basis for $X.XX the Also, increase our prior the now XXX outlook. basis, basis points, for with an basis impact

remainder as assets BXB now have X, and are of NetSpend's moved held Also, outlook sale to we business we we of our reclassifying and business decision Additionally, July to the therefore, with to reclassification continue range assets calendar held sale of net we to for XXXX. the a billion bolster the of in billion Russian $X.X exit BXB $X report businesses. consumer FX headwinds, incremental our it as to assets look sell consumer our now expect to core adverse for effective of NetSpend's our leading revenue for to in the the from NetSpend’s removing year. our segment Issuer light In adjusted combination for

to incremental roughly impact includes adverse We May. report rates exchange range for $X.XX since the an EPS foreign continue $X.XX XXXX, expect in from adjusted currency which $X.XX to of to anticipated

We relative the headwinds original a be and the guidance stable This are macro remainder additional our absorbing toward maintaining lower throughout XXXX the albeit assumes adjusted year. we expect Russia, we ongoing outlook and those recovery same of the to pandemic economy as to range from reasons. for currency exit EPS are outlook the end

consumer assets the retaining is NetSpend's our we've targets EVO, back cycle. At issuer from the rate NetSpend's the done disposition concurrently per raised the expect our per and Netspend’s slide our at business help XXXX consumer to assets so that customer the set our that, our and We raised September expect with then sale share these turn deliver consumer As adjusted to Conference. top company core be run the the BXB EVO closing and in combined will of I'll share. assets for effect, Issuer In we line synergies the business by Jeff. on the earnings double-digit and of will teens intentional focus. Upon roughly over have merchant presentation of growth achieving to NetSpend of financial acquisition acquisition, represent inclusive forth Investor assets of XX% of our call we the prospects of we will and transactions, attractive our goals mix XX% to high And today indicates, to result our NetSpend's guidance consistent which cycle over provide EVO EVO growth. we X of This businesses. strategy while the represent earnings growth adjusted neutral Solutions, purchase enhanced the shift bolstering to us confidence And full with XX%. with swapped BXB of

Jeff Sloan

hours investor Thanks, were in pillars key our those new X-plus past strategy at September. XX-plus In of set Josh. go-forward pages, X our this Global the We effectively Payments the detail. previewed forth and conference

at omnichannel scale. dominance, and markets partner; exposure faster owned to BXB growth Software, and

announcements I guidance. then our think are with cycle we to keen why clear it's today's now raise

runway derive which of merchant growing primary Upon of course, and growth. expect We and with businesses at issuer X/X enhanced each X/X we to have each our BXB. going for these with transactions, X the of characteristics. further from net forward, opportunities attractive in closings rates ample margin is from inorganic revenue of adjusted and Organic abound

Silver geared gain enhanced share toward segment our multiple We the evidence better In to cycle, simpler continue growth growth corporate in of of and each over have to with our a to these in durability as plans. prospects. strategy honor customers way have to and margin the model, Lake that than part of our prospects levers what confidence more

Payments positioned path investor a As of disruptive our repeatedly markets. choice respected maintain global enhance partner its is to SLP, well we the technology highlighted Global last September, as across most Winnie? and agrees.

Winnie Smith

Instructions] Operator, questions. we go [Operator Thanks, to now Jeff. will

Operator

[Operator from question Instructions] Peller. comes Your the of line Darrin first

Darrin Peller

start of cleaner -- we the of all think Congratulations Look, when strategically, to I side now without without want to on about business. much just and these. businesses Netspend want off I going the that the forward start really combination the

with a strategy geographies software acquisitions You software-led been historically with track internationally doing has some would EVO I acquisition had a very record JVs. you where or great know grow different partnerships.

being on a you see of So emphasis international and the do and the can terms both? it JVs on that in I focus what dovetailing think other on you you now? to really be touch versus reach Or expertise? mean is just going the more forward of little one going is business of

Jeff Sloan

comment, start, Darrin, to Jeff. it's Cameron ask Well, too. and I'll I'll

M&A we've markets said, to vertical really geographies We concurrently. and at, companies, but pipeline you So deeper as software I attractive outlook target say and hasn't always look would market our for existing our new changed. and on our penetration looked

as said So that remarks, exclusive. effectively and sheet managing mutually our doing in we prepared balance not our are

are thing other is The about that we fast where we kind of nice enough. deliver

of So December the in in actually August same we 'XX, back leverage if 'XX, by that sitting early 'XX. are you close we're at ratio here

too. ton of have firepower. stock we So back now I'd buying be and financial between add that also a then, we'd

you things so outlined. further We'll want happens of continue anything? the It existing geographies. flexibility companies look capability will many look penetration to add I change it new to at just geographies. look We'll that continue But doesn't of do no, priorities. our continue EVO of software that strategies. Cameron, on to plenty our to really just have and fits to we affect at So at

Cameron Bready

think EVO is and Yes, it's you business say, add roughly things. foremost, the technology-enabled. just about I'd of lens if our I'll a One, today first the Cameron. through strategy, few of Darrin, XX%

So that I very software would with our overarching is view driving through the around business enablement much strategy growth as around leader make. the technology our the of point globe with in aligned first in

trend. the already perspective AR we that space, And then the clearly, have and to us BXB is our key strategy again, the capabilities growth of particularly bring it third, markets I bring as would EVO from BXB line element fits and faster having us us in around continue also that superior in second nicely top but growth build BXB a automation those to world bill is software, to that distribution exposure The opportunity new growth with drive an what around of out to strong helped allow of better a growth payments. technology-enabled rates markets technologies even well. to payments are And that augment to gives drive, does markets secular software say, to rates strategy

nicely So it many technology-enabled aligns years. the BXC very for been building with strategy we've

So EVO last really strategy in I to think decade. build very today the nicely business our aligned complements been of over the aspects and many totality we've trying with

Darrin Peller

helpful. really That's

ERP just and more to you BXB. hone obviously the Just does assets in for want a with connectivity as now. my on the lot BXB This I follow-up, strategy systems give

market to term, BXB characterize and longer that contribute if to that medium as would business see could to the really So what go you from differentiating standpoint the to a going be can you way what great. just real you're

Jeff Sloan

Great question, Yes. I'll start Cameron Darrin, too. comment to I'll it's and ask Jeff. again,

EVO BXB first, overall, in me light So complement absolutely and terrific for just question but business. specifically of building business your rock-solid let Jim on an and

diligence the with assets. and EVO, of for So we in these during culture team BXB the particular, are purposes but extremely our impressed the

which, So receivable if my business, MineralTree, complement you to for back breakeven. closed remarks, MineralTree October, which last business were software accounts I schedule on as looking the ahead prepared an in up, accounts of running to mentioned is we Darrin, we payable

ended quarter year-over-year said, Ry just June. as XX%, think in the I

couldn't we more that. So with pleased be

it pay businesses we doing If complete you it in TSYS volume and post BXB that's most of today think But other we're so out card, of have card. And anybody million TSYS, said think like revenue commercial MineralTree, BXB is post coming retaining profitably the think BXB, there. with scale and from mean card billion we're $XX positioned not thing those I where but successful $XX X/X assets, when $X worldwide I closes, at NetSpend's we investing we virtual among about post EVO, year, just Netspend's also we billion now ultimately probably something in were the were issuance a of assets. consumer of

EWA Paycard, So over parts moved July to now not we'll the X, segment. effective have of those as said, to I issuer issuer

ERP think we that built is combination in And I of last us really with positions which Jim the integrations the don't I think Jen native link, I but we So really trend period else bring so smartly have as time. everything and EVO us missing and businesses, said, over is we our the middle have, have receivables distinctively. own

Cameron Bready

proposition Cameron. and enough associated successful other accelerate accompanying Maybe integrations really with at ERP BXB our how with We're without proprietary tactical BXB value just it's Yes. and couple AR Darrin, points. the emphasize selling will I those software. the strategy. can't integrations acceptance the today very that those a of integrations

very and our we're I acceptance about around strategy accelerated, that. is go-to-market BXB meaningfully excited payment think

out to with my automation of and to to mid-market and money have able point can industry money think to complement Secondly, a from we're we going again integrate think a else value this a BXB being we full of the it the largely in strategy comprehensive, EVO to conference, do in, complete up emphasis so comments to anyone bring go-to-market solutions of Payments. the sort with brings the goes couple at we're I trying it what Jeff enterprise the can a highly earlier, that is really integrations when back BXB AP investor Global market. I proposition the offering don't back does as really key touch. to payment

Operator

Keane. Bryan Your next line question comes from of the

Bryan Keane

my Jim Atlanta is GPN you familiar former just question at guess other, headquarters, have now? executive EVO in been with and are both obviously, I each and very GPN. guys a Obviously, the why was

it So of this timing just deal GPN thinking the the came how EVO? about and about approach

Jeff Sloan

Yes, Jeff. start. Bryan, it's I'll

on this So from what I to side, file their they I merger, line. Jim it context spending But for more over just actually that would TSYS lot the different when long want I a I one to that. X XX finish is tried Bryan, been don't the say trying. in me said look, would took obviously the so jump It to I've say careers. a ahead years proxies, of ago, of get of come my I years number

I'm you've laggard been and and listen, customer of known, Global, over for it's certainly, But at get lack do, a management said, XX.X obviously, holds we've team customer is obviously a of myself, EVO. at large. it's the for maybe Jim, a and duration been years been the I've over They've in as particular, that long bars too lack finish for I Maybe to time. time me things kind effort. But of a not just So what of a long takes line. it accomplishment. a

has in as team the than Jim really in as response we BXB guys strategy better a especially mentioned, [indiscernible] side side. So Darrin's Cameron than couldn't obviously, those better one assemble partner tech-enabled to leadership then and a have said, could just have question, and the we the

think as point Jim's I'll the why. say, and this. EVO’s would aligned So I of trying mind we a is do now from it, thought of nice view Global. great you and about view to this, It's time and we've we that point in that stars tell been

any the And and what a those FX by and a we've XXx as dollars terms roughly deals today. done our at buyer reflect think macroeconomic current of marketplace macroeconomic environment. vary reflected in that announced going share, And is have That's transaction, Jim done into synergies to people we comparison. loaded way First, EBITDA this XX the for kind in the our do We're we're that just and climate. per by XXx calendar the strategic XXx to don't that for us, synergies the fully Prior other and business going strategic synergies it. we are have look, 'XX. environment. in expectations paying a of with for

been that delighted Payments of tell a fruition. able to our really have end least that's X just I'm I with We've this we be long it years Global today. good together. the couldn't teams all I something at to that announce been pursuing certainly would more very gelled bring for that at you period the of So We at to partners time. ability day, for have were the many

Cameron Bready

which we're about is, add Bryan, I'll point our of the one with reach And it's third Cameron. TSYS. merger to other look, that, anniversary to just

is timing ready right the us on take for So an as as integration matter. We're to well. this

today. what excited business European European Essentially, and forward billion have to brings scale markets Mexico, it are capabilities the U.S., our going businesses now like teams does opportunity, obviously, particularly in the business. also U.K., about additional have Our the it where large $X roughly we'll to and we us

the opportunity. have the team delighted is to I think

execution So the matter. for timing as us an works well

Bryan Keane

No, it's an combination. exciting

one year-over-year. little guys software. bit that talk about Let just you software are high that you XX% there because Can well noticed guys business sometimes, enough in results. doing ask gets And point-of-sale if seem to follow-up on know be in me quite Merchant the you if a I don't gaining the share point-of-sale competitive Solutions, the growth there? landscape On I up quick

Cameron Bready

start Bryan, and I'll Jeff to Yes, else. Cameron. you'd chime anything in it's if maybe like to ask have

is delighted made the market-leading POS year. to XX$ I XX% the That have XX% with in really business. rate very the progress growth last think We're in in we space. quarter probably of we've offerings off competitive software that

of very that from, So mid-market, capabilities to the enterprise kind the down way to of stem suite up space that capabilities again, we scale higher all full and we business into retail to the POS with nicely small the of the the the even restaurant low that end with of continue our end have. market

because end this restaurant we it our of some exists market and end We we're upper that excited have of about brings we that Essentials the the call quarter, restaurant Package, the down of in the also market. lower launched today, retail the what retail with to basically our fluency product vertical really and which

offering. POS grow in restaurant additional scale verticalization, our but simpler with benefits they time And a over on can they that So retail think the core solution and that's business get into and going drive our tailwinds to even of forward. I going

overall Canada, look capabilities forward. that of further to tailwind landscape. positions to that talked think, have our our somewhat of we'll think we as we say retail distinction I opportunities. U.S. a have Spain, that And the very it a further be business prepared again, more distribution competitive think landscape and lot ourselves my nicely on business, in offerings that that markets, able the POS I products in to a our to feature U.K., So the Europe, to capabilities, look, to we're restaurant about the international creating thing markets lot coupled the last our POS against. has those scale Central do and we're tailwinds and we functionality, quality software we're in positioned a I unique outside well in growth driving ability bring us and well Obviously, it's EVO the the us with solutions grow into differentiation is the bringing overall intense those I the space, bring to going service competitors will in customers, is we well, about and remarks, But would have but really that to in for in for business continue markets of

Operator

Dave Your next the line Koning. from question comes of

Dave Koning

so couple -- a of questions. guess I maybe numbers And

line? what fall there? of First that synergies in to And to kind revenue all, talk and EBIT the the of $XXX is expense of does are maybe synergies, all million

Cameron Bready

I'll there, ask with other in Yes, like and Cameron. add. start he'd Josh as to comments Dave, well to jump it's any I'll

a lot around foremost, distribution software EBITDA yes, through customers. we Those in our market of as capabilities of EBIT. overlaying business. very think are I the Look, for will savings would gains as to opportunities vast to POS existing enablement on attractive. no the capabilities revenue business acute savings and EVO's well EBITDA the into side. first I say, So flow bring EBIT our with talked solution, vertical There's extensively is commerce of about The sort base million, talked EVO D&A. the I $XXX being script, being synergies about ability all played that there's this

then, very that a EVO's cross-selling positioning in revenue multinational I is significant what a go-to-market course, incredibly businesses. EVO's attractive, opportunity. think, think to strategy UCP enterprise of I own growth course, is does matter. for solutions and customers our there's BXB BXB our acquiring, attractive to overlap amount attractive is as of And And an and of

we put like source distribution there in when our harmonizing go-to-market sales significant will a opportunity EVO, platforms. So benefits look the leverage in scale. some X perspective the able businesses ability customer at synergy and we Clearly, technology of be obviously aligning synergy the Philippines of a we've from what is strategies to as the an captive opportunities operating and and together, environments, environment, gain service the been to to offshore servicing our do

attractive at that of all the historically. even levels Heartland are significant our of in TSYS that than and think deal in transaction I more the synergy say transaction or the seen opportunity amount we've a would I drives

have call the to today a to So over I we of the earlier in get X-year are feel horizon it very started. in ability number. confidence lot time outlined deliver anxious the we our good and about

Dave Koning

just then like said know bit a this think to discontinued guidance net and seems I raised us It numbers include the second to of spend looked but one include numbers. guidance it And does rest I the still NetSpend like ops, both year? a were has EPS in on you still revenue for and the it. that

Josh Whipple

Yes.

guide say, a basis, currency look, constant what hasn't So changed. would I our on

which expected outlook. with growth is still XX% our Our prior to XX%, consistent is

adjust billion, headwind removing estimate my be my $X.XX adjusted to mentioned the in business $X.XX basis of for net which commented that billion to would second XXX currency half range merchant in year figures then the revenue I and if to to $X.X as B calendar be and Russia billion revenue can full $X.XX constant expect we points $X Schedule as expect billion $X.XX the we remarks, consumer, of after year, well billion we C prepared reported release. to I XXX billion, prepared for in We see approximately which revenue XXXX, our to for remarks, before further, our on of dispositions the year be in include you to press FX that

Jeff Sloan

just getting you're But be view $X.XX the in lower was probably of I May that to the in whatever of range quarter, original would reported to Josh think, think math we and is, toward right earnings essentially way stressed, Dave. Dave, first we're from about or point although Dave, because that to we it's expect or guided to today light think it, another the was honest, from Dave, our we we February, end Jeff. we're an Yes. another to absorbing I $X.XX report, would the the just in and $X.XX it the things add, we earnings the to just range, I kept be mentioned. original that probably

would you up. is actions, what I Dave we're the why is in is way margin said, So which say earnings, the it which I look is taking particular, at on

a the raised So quarter our for in row we've expectations. second margin

We're essentially FX. formulation, reported we're the layout certainly but the absorbing formulation, So same in February. yet still range from revenue absorbing we're and Josh the from Dave, all earnings a Russia,

Dave Koning

That's Yes. clear.

Jeff Sloan

can I I as it, own tell as can conclusion. you but you that Dave, view have raising a team, management your

Dave Koning

Sounds great.

Operator

of comes question next the Ramsey Your from line El-Assal.

Ramsey El-Assal

quite on and Margins talk I the the yields the question sustainability as as through the model you well well. drivers the drivers did our had and in of as the expect about we of a those and of Maybe yields expansion segment. take margin merchant things a those both outperformed for bit, year? could move as what should we back quarter, half sequence of

Cameron Bready

any to with Ramsey, other in it's ask additional or jump Cameron. and Jeff I'll commentary. Josh, start

expansion. the business. I things think, tailwind, to I'm of created margin of margin our I the around overall Obviously, to execution it been proud So which on higher margin I in couple We've a for really an the has front. reflects very levels able strong of the globe. business, would say think, of incremental think continue drive, I continued teams

lower have we've that thing seen have well. recovery expansion to second the think markets in is profiles margin nice I that margin tailwind a been slightly as

in some to around which be would continues with creates of good a on Obviously, some quarter. currency a there, overall. digits lastly, again And of the margin conversation. COVID, I to constant growth question to Pacific your to a is example bit continues overall say, a It it we Pacific to Asia I think tailwinds struggle Asia mix think growth see but I double grew basis, region yields, this that. tailwinds do

market up as vertical the I fact a drifted we we that continue to work having previously, XXXX. see think our businesses the commented As on we we would that that anticipate That's and has little bit. through what recover, forecasted you'll yield

today, think grew you basis, volume if XX%, I look Russia, So On at the excluding constant top XX%. about business about grew currency we line.

due to So to showing that vertical of really the or business, negligible, of better delta some as kind of volume continuing some was yield to growth markets in environment, between to and mix that a revenue it overall well. degree some due recover recovering

Ramsey El-Assal

what us potential volumes? follow-up recessionary the on Or numbers? signs a for quarter-to-date thoughts kind Are there? recently you're on just And what your of also any most seeing your in book? sort of seeing is consumer you weakening and your for impact your spending Can you're view of give what you in And comment own me. on seeing

Cameron Bready

Sure, Cameron. Ramsey, start again. It's I'll

in with consistent, sort with line our May think we've continues trend seen would say, what of in June I frame. to I relatively and July expectations, time

the on sitting very today place trends phone, continue material kind consumer watch stable, I'd very the the everyone we'd continues consumer No relatively with think in on consistent a But the I volume of we any expect. here you, front. we say, weakness sure business, real see, of good closely. I'm that very, to very sign to like healthy be and what else in

activity this summer I the think we're there's lot during of months. still in a Obviously, period.

out lot experiences for of in comfortable a see how And more that maybe through given year continue operating I'd the say, trends demand in. relative pent-up July overall think expectations. in been there's relatively the engage we're to kind But of of think consumers I and environment to progressing we our how we through about so to balance with macro I we'll goods. be and the get and volumes see less

Jeff Sloan

it's same Randy, is true side. the on Jeff. Yes. issuing thing the say I'd

July. good continue in see card. commercial to in volumes really see We We really issuing strong

it second I are you the Pfizer disclosed and those to and look would very in of the actually XX% think trends car commercial Mastercard, quarter Visa, last of in we similar for week. expectations those us, slide, say growth I out and heard what

where Live, the Continental are. hotels, last way, kind the airports, we in So Canada, and in the honest, U.S., of months in the Europe. pleased with the And the in really the in let's I've couple been packed. on U.K., The of road. twice streets the restaurants, by be are

healthy are So you tell don't things even you place. that a in me to

Operator

of comes from Robert line Your next question Napoli. the

Robert Napoli

Congratulations on EVO. acquisition of the

and asset good Good there, a together with see. got to You've Jeff. back

follow-up on maybe BXB MineralTree, a Just guess I the business. on

the You called growth out AR assets that have well. now XX% you as and MineralTree on

First what And to free are seeing been organic. able of mineral your XX% base? into commercial cross-sell card that you've is all, customer you

Jeff Sloan

question. a I'll Yes, start. Bob, It's Jeff. it's great

So yes, military comparable year-over-year. the XX% in is

an comparison. revenue that's So organic

which EBITDA at significantly I now improving my prepared substantially it's been able breakeven, in the while grow As we've profitability. to also mentioned the revenue remarks,

the is base BXB net off also X,XXX very EVO like When all pipeline but what's So is that We're in MineralTree FI or no revenue surprise base June start. into someone of end question to that post synergy is issuer whom the our we to businesses. great whatever running business XXXX, reports very X,XXX you merchant about in of math is and how say deep overlap, who's is cross-sell terrific there's our matter. there. is on We functionality ton today. did the a pleased one MineralTree second a but of just I'd to at the your not Cameron's The brought actually targets whatever, of executing. a was to now the FIs, with

space. into things surprise, no that So like been enterprise we've the cross-selling Bob, QSR

procure KING You of on. those would actually and BURGER folks imagine types that

are for about TouchNet all think cross-selling. about higher think ed care, university. really Those would You AdvancedMD, targets health the for you in good and example, in

the that add you Cameron, revenue in very anything? we're about excited opportunities business. So to want

Cameron Bready

with add I lot only the other of of working work see as of well. software our covered integrate their think see meaningful well, our the like some X,XXX of businesses, partners I ISV just in to across that I comment opportunities solutions into is, opportunities existing we No, with own suite today. sort software would The partners a we we MineralTree

opportunities. So meaningful cross-sell

going opportunities I as doors up growth more well, can for the across marry drive more of with BXB to provide to even faster us that's that think rates and open when AR software channel. entire we

Robert Napoli

do that. follow-up environment? an a know to on great give just but than than just you’ve environment margin little should out, I operating been inflationary had how be expand tougher it the a guidance expansion, called expected execution, what maybe we to in in then Jeff, better And more color your you can much able you where on margins this

A –Jeff Sloan

question. Yes, Bob, it’s a great

say, our I are revenue would growth. things So of those in derivatives business,

at line because of So the spend incremental Josh if growth like-for-like Netspend, that our this net what is lot bottom is XX% currency to if how business growing of you fall a revenue is something all said look you’re like morning, think constant revenue, revenue growth. rates at generate going I to about and report what we x and we

of not surprising outperformed, we kind core maybe growth. that me to So double-digit revenue it’s

our Cameron touched this and market is would The businesses. ago say, on software second minute I thing vertical a

recovery in were So those coming while businesses. kind that for into a pandemic, of we a

alluded to call, comparative returned now to Bob, we our year, this growth. obviously, have of in those call our last and As year, November February

in just So Cameron Bob, that businesses a the at software margin. there come surprisingly, Not not segment mentioned, are a merchant high tailwind in a headwind.

really the up of XX% well XX. in aggregate. software, in thereabout fording and you software second something to on of like talk at XX of ability in it probably rebound, our a in or about growth market brutal we’ll I quarter kind capitalize the for was business some So rule rates think rule Well, cases,

So stuff not of drop is surprising the to to lot line. bottom a that going

A –Cameron Bready

think highly highly, solutions in to representation growth. the alignment in Obviously, top in better driving business we’ve margin leading outcomes. I We thing we’re see profitable very business More believe in there’s our is of for and focus away Yes, the and proposition is higher continue that and Bob. And we’re our and no add focused better business. core more, the we heavily growth I growth that that growth been expansion as don’t drives team. with really revenue that business highlighting the obviously, technology, a only nothing. elements We on The deliver value we we on management and in our of what profitable volume always between give X margins to that line to the the would customers.

Operator

next of line Friedman. Your comes from question Jamie the

Jamie Friedman

of you the about your Congratulations of it, on it? makes what BXB numbers But that to the a ask Yes, Jeff, in I I can prepared size lot remarks if remind us wanted want and Netspend's does Pay roughly and mentioned card. exposure. the have to sense. you about you transactions.

Jeff Sloan

course, of Yes, Jamie.

So -- But this million we said actually at our review. I $XXX of in Paul the $XXX about February, think strategic we it's announced time revenue. million,

we In to what today, in throughout. formas you I'm schedule actually going gave of would like. supplemental And kind produce it's see we the to as schedules pro it also to, look that say fact,

as see schedules bit, BXB those $XXX access million quite see The mostly a too. with Pay normalized card, It's Pay is but like So mid-teens basis you said there. selling banking of of kind Jamie, the quote you at you wage it it what some memory, grew last something second business. $XXX and business, that some normalized Netspend in card like, in looked from in that without a I there's businesses and a as had having what remarks, But also Jamie. I'll in in we're just I issuer the prepared stimulus million, quarter. it's you reason think it And looks earn revenue service year, actually on like and I and for say yearly effects

the we little card, bit we BXB, were a have in business Heartland card, it's merchant, is mid-teens issuer coming it's what have of in corollary second grown there commercial Cameron's still at. quarter, assets is natural to virtual So in government. assets signals And say, to have the federal that which from in with a the But the you payroll.

those businesses. nice very So a to corollary it's

Jamie Friedman

was Got it. issuer, one second And about here. nice my then acceleration

with of and Just what's us oriented the rest wondering -- you if for get year contemplated in what the issuer, that. could

Jeff Sloan

start, Josh. Yes. It's it then over and Jeff. to turn I'll I'll

on So tracking, X% prepared constant printed as remarks, said expected. right growth, with was is obviously, it we're in track X. with MineralTree, currency Jamie, my we I we Ex-MineralTree, what which what

happy super on where think So really about came it track We we're out. there. a good

As of the quarter, record transactions second a we volumes pipeline you're year. all we the last everything I have think a said too, Josh, to rest give on accounts on little what accelerated commercial quarter. and more said the see about third quarter, file the And I second want in that color going and and else, to in to on based the quarter. relative

Josh Whipple

Jamie. Sure, Yes.

And XX ex-MineralTree, for saw if expand XX for quarter, back points. basis to the of you -- see strong expecting the we margin margins leverage, think you we're back second go management. year, So Ex-MineralTree. points I we if margins operating first think the expense expand further also then the And quarter, to expansion, saw half basis

around from second from will a We've very leverage. that strong we a back that ahead comment then go third And and and see we perspective, I accelerating. seen think into fourth to to goes margin. which revenue first the contribute quarter, expect and trend continue quarter operating the it also the nice -- So to Jeff's to quarter

Jeff Sloan

terms hey, might for to you side, right to U.S. issuing strategy fintechs overseas I to X say AWS worried regulated The when look, AWS we is ago of there to FIs and the the started Josh exactly can the to to, that's were were in That have just obviously, Look, institutions we Canada and say, outlook we're outside and side. cloud first exactly think the started trips, what with Jamie, of the this. what's on true would is most not sells, we also and move say I right. especially Jamie, would this, years true the sells, that about with managing some now. my for tell first our of I path been business, cloud. on And I Europe,

we really been what record kind receptivity the are has So have where but now view better. a never to is pipeline, the of pipeline, we and shadow as which my

obviously a behalf you to those We to position opportunities. in us Jamie. the Payments, we're in of I for to it of assets fruition. to wrestle Global On thanks, particularly really fortunate for have business, BXB ground bright. the that So abundance joining But need the bring and is thank this morning. Well, future think

Operator

concludes conference This call. today's

may You now disconnect.

Global Payments (GPN) 1 Aug 222022 Q2 Earnings call transcript