PAYS - Earnings call transcript Q2 2019

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Operator

Greetings and welcome to the PaySign, Inc.

Second Quarter 2019 Earnings Conference Call. At this time all participants are in only-listen mode. A question and answers session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. plans, forward-looking this the information otherwise presentation about company's include information that and make may returns the in operations, events. presented discusses business statements presentation about statements markets extent to the expectations on future This equity, of or results financial projections, forward-looking. Such statements are

proposes. by Such anticipates, forecast, projects, believes, identified of such the and forward-looking statements can as words estimates, expects, use be should, intends, plans may,

on reasonable the could believes based forward-looking the statements of reflected number expectations cause to differ that these there company materially forward-looking in assumptions, risks from Although that results uncertainties a are such are and statements. actual

You the our XX-K. are cautionary including statements any made consider under XXXX Form risk review urged elsewhere, to the and and disclosures statements and other heading carefully factors

includes non-GAAP of except only with U.S. an in accounting required law. does measures accordance not alternative speak as document in adjusted nor This are and update date to GAAP. prepared as statements principles, duty the EBITDA to of any with the the that presentation financial contained statements is forward-looking may undertake generally prepared company accordance they which Forward-looking and by also financial in any not measure accepted

these in EBITDA is not to similarly measures adjusted of not to necessarily companies. the on titled other GAAP methodology any comparable appendix most comparable included measures standardized measures by addition, the In is reconciliation A to GAAP based direct prescribed and is the presented presentation. by

CEO, sir. to pleasure ahead, introduce my Newcomer. Mark go Please It's

Mark Newcomer

Executive of for reinforce of our On our brief will I'm earnings second will PaySign to good I'd you quarter what and Mark Officer to the some like overview Inc. at call. everyone. and a morning, I PaySign, XXXX direction. highlights of here strategic provide you the second Thank Newcomer, Chief behalf quarter welcome

remarks, Officer, the through Attinger my results. will second quarter over Financial to Chief Mark turn our take I'll it Following who us

will we field your then questions. Mark's Following review,

We new to solutions both support our our payment innovative a are vertically integrated you and of those customized processor of a and manager. is payment story, that For developed PaySign and program consumer presentation, card corporate, in government services want prepaid our investor may website and history the to and programs. our of to more section most visit learn a www.paysign.com. review provide you recent copy at of To we about the investor

We are and record quarter revenue levels as with profits we forward very with pleased continue our second have reached both growth as our results strategy.

our implement new remains effectively design to ability and to differentiator customized company key for retain Our and scale existing a grow the us programs large client and programs and enables secure manage business.

In an representing representing of summary, Adjusted record programs also to of million was compared was increase $X.X programs million increase QX a We've of an increase to continued of record $X.X XXX%. Net on-boarded and revenues in the excellent experience a from XXXX. prior were and XXXX XXX%. income year. in client EBITDA an $X.X existing million growth XX% quarter new our

performance the the XXXX. and to improving to expect experience and growth We to on strong balance margins of year operational until continue

to With expressed that go in programs several wrapping to has continue $XX consistently and million. and preparing card which for have our previously guidance, internal diversify pilot financial of been XXXX communications, with our up to market respect existing to changes no we're we prior as $XX broaden Strategically $XX of are EBITDA Card, successful PaySign we'll with prepaid revenues million to the million a There and will products. our our and communicated product. for $XX focus interest seek the clients Premier adjusted first to introduce million live to new of and

some our Chief very lifted of talented may Matt also You added an experienced executive talent, teams. business technical individuals Lanford Officer. noticed we've some the including experienced hiring development in and have to as our that We've leadership and new Product

journey in space and steps and They're a these very beyond. to and model of payment purposeful very important purposeful are -- important leading building capabilities the set business world-class our in and

we profitability. continue candidates demonstrated pursue suitable that acquisition growth to have Lastly, and

I'd like to it time, our to detail. Mark more a through to CFO in us this At turn over little take

Mark Attinger

Thanks, Mark.

through I some quarter So commentary. will numbers us variants take and the year-to-date top-line second and provide

increases, quarter ending year-on-year As improvements quarter I June second compared to quarter XX, last stated second otherwise, stated XXXX, references unless the of to XXXX. or refer does as percentage to

it. into jump we'll So

quarter XXXX. compared attributable our of Revenue XXXX Revenue was profit of to XXXX to client improvement from $X.X costs. the in secured and million compared our first $XX.XXXXXX early XX, industry mix resulted XX.X% favorable an of for both XX.X% million, million. June continued existing XX.X% from was and This maturation or of XXXX, increase compared for to half growth an point clients of was and business $X.XXXXXX the in the XX.X% primarily in and second continued revenues increase optimization X,XXX $X.XXXXXX. ending revenue increased $XX.XXXXXX the of basis increase the XXXX. a to million in network $X million, to This of revenues new Gross XX% and half

investments in expenses operating The second and $X.X half by Both compensation. an consisted incremental in as in increase salaries XXXX. of increase $X.X $X.X compared stock-based primarily the new The to $X.X were million. million million and quote to personnel driven of year-on-year primarily in million benefits

balance to in $XXX,XXX of the consolidated to However, OpEx to just improved just year. of million, points compared as income Similarly, Benefiting compared quarter operating as of to XXXX. increased decreased XX.X% prior was XXX percentage prior expected, $XX.X $XX,XXX compared we a fourth are basis OpEx the as revenue from interest leverage see cash continuing year.

or XXX.X% ended or $X.XX second in XX, XXXX, was share share, increase quarter per $XXX,XXX million basic year. for $X.XXXXXX income June per Net $X.XX the to the of prior basic an compared

per million share income For increase the or million basic $X.XX half an prior to XXX.X% was basic or year. XXXX, $X.XX of compared first share, $X.XXXXXX per net the of $X.XXXXXX

the earnings period prior million same $X.XX increase year margin basic second -- versus per year. the year. XX.X% diluted $X.XXXXXX basic XXX XXXX. the the share was fully prior EBITDA XXX.X% compared basis Non-GAAP quarter per same half up million the or adjusted prior $X.XXXXXX in EBITDA or first was The share, per adjusted $X.XX $X.XX of share to an XX.X% improved to of from points $X.XX Furthermore,

prior quarter Non-GAAP of earnings per increase $X.XX share million From conversion first prior year. share same year. same on basic per period volume $X.XX a And compared adjusted $X.XXXXXX BPS prior compared $XXX revenue of $XXX or dollar the BPS rate million consolidated the year. or period $XX.X year. half XXX Restricted X.XX% our to the or or the million growth was We share $XX.X $XX increased million XXX perspective, X.XX% versus million the loaded $XX.X cash cash X to at month for December sheet per million was XXXX. prior in million, And the ended cards versus the basic to the card XXXX. loaded balance or $XX.X $X.XXXXXX $X.XX EBITDA versus was has $X.XX was compared an Non-GAAP XX% the to to year XXX.X% million in million

X funds to represents at card typically at a to many restricted both loaded by month note, in card require and card provide in not as to time revenue as be to and be months cash Clients time. various prepaid has point the advance. to in dollars points business. our in loaded dollars the been Furthermore, as all generating loaded products in X case cash XXXX will Please

smaller higher receivable less Working current from in consolidated increases to due to assets increased payable Capital; accounts liability. by million current liabilities cash, million corresponding $X.X decreases from accounts and $X.X client increased increased in year-end offset the at partially billings

adjusted from sheet was $X.X Our liquidity measured both And million restricted million up ratio balance as cardholder sheet. current from cash at there finally, by no your excluding funds of $X.X sides on an the remains debt balance respectively end. and

in the continue see to expect As XXXX, revenues. half increase second we operating continued execute to our of against we in plan

We margins. also to net improvements we And further average margins operating EBITDA similar expect leverage and on anticipate our adjusted quarter. therefore experienced and income to lastly, higher those this gross

goodness. for I think about remarks. that's it my Thank

over it question moderator, answer to Kevin, I'll begin turn time, to Thank this session. At our and you. back a

Operator

from [Operator from Instructions] coming today is question Austin My Moldow Genuity. first Canaccord

live. line is now Your

Austin Moldow

with the is else. something if you my could to kind on you just provide pharma pharma pharma the on Wondering give if how more traction on revenue terms of Thank if having Hi, much questions partners. My business. quarter. what can contributed first congrats you And you. or what Maybe the taking channel materialized percent one in thanks for about and the you're color and this in success nice seeing. quarter can quarter talk you're segment

Mark Attinger

that. thank Yes, Austin, great question. for you

in and prior we new quarter, last the the the for this from programs XX% of seen up third quarter quarter quarter. maturation client pharma a represented the revenue implemented of and in those. year of of So our XX% we've first several pharma year, And approximately

additional we're really plan to in success our in as our overall as relationships execution preparing and partner are programs onboard we And We on expected. seeing well. channel good

Austin Moldow

it. Got my Card. is on the question Premier And second

for out? doing potential on customers. maybe when could that you potential but pipeline timing roll the And talk interest internal an be you're Can update mentioned a launch? you your you test some You could if other have you in maybe from scale about what of of

Mark Attinger

Yes.

directional. it I'll included in we of talk little And I release. we I kind aspect that of think then bit and of that about a press believe -- the reiterate just

a but the be the So client would live we expect to of from August. by by latest implement part Probably commitment one of preparing we early do have end are we go to that of August. end the September

are it's program piloting and to We very have how that been pleased date with progressing.

clients customers and product being evaluate this several their as able that are that. have to offer we're in well We continuing to interested to

is and captive have those portion cardholders our historical platform. and of one are of on active our A we advantages a are therefore audience. X.X the cardholders over on they platform are a those So cardholders have portion we million of

is our included talked to projections this and important do any but this So of performance make about a the learn have for to any rate the growth more contributor those we continue not the about acceptance from to and comments comment, XXXX. we in of before before that it's be One material our earnings we further Austin PaySign we expect in shared, Premier we the as year.

Austin Moldow

of on Plasma of have you Understood. kind are you programs which think in currently Plasma flipping from success number you on. time card And other if what maybe I'd Wondering share XX% my past updated rate, on progress love in to last over and to network. I business centers the a any now if them you're terms of the know winning that you was centers it. your network your provided I question, ask can the and have penetration seeing final could, about I new

Mark Attinger

can I dollars market and you But Yes. that. to as grow as we're well having continuing tell in success We in absolute won't comment detail on we're in share.

Austin Moldow

Great. Thanks taking my questions. for

Operator

Hickman [Operator Our Thank coming Thalmann. from question you. next from Jon Instructions] is Ladenburg

live. now is line Your

Jon Hickman

elaborate Hi, little through the taking quarter. questions. a platform? more Nice on that to pretty thanks my you're Could fast. adding for the you you went personality And bit

of that you me. through kind again If go would for could, you

Mark Attinger

Hey, Jon.

So the and a set mobile well-built bring we team. have as out, technologies, a out pointed that infrastructure into but some just We've resources implementing round we're the that to Chief our development to core around of as Product for for have products continued development to efforts. add team did respect and and application Lanford to capabilities on platform Matt that add CEO a of also with that and to development continued we officer new processing

to So our of nothing strengthening resources and enable continued infrastructure development beyond growth.

Mark Newcomer

on the teams. technology both and that's business development And

Mark Attinger

point. Good Yes.

So as you Mark that. stated, heard hopefully,

that's development. technology Biz as as well the Dev So

Jon Hickman

is factor them that. answer thank -- question answered now? what's like I but and is concerned like most that I most you're about my just know of for -- Could gating the something previous asked wants that there to the don't -- you questions So who you right this and the

Mark Attinger

always number quarters a years That's trajectory. last has of many about I continuing it's in great growth done And always question. our to on execution. been about for mean, the as it's implement

implementing that's we'll and each in if been every particular continue successful do have that business. that us to keeps not something business in in successful night But work to securing there's retaining and hard question. your And quarter. up and We at

Jon Hickman

one then me. last one for And

quite any about So, on acquisitions you whatever an or you Could through well, acquisitions? radar? tuck-in executing growth seem kind basis of Is on other be - to make here, comments maybe that your organic well.

Mark Attinger

Yes.

maybe prior round bring to we that's in stated can fit continuing our then opportunities. has and CEO our as we as product well good So we releases, evaluate shareholders. out to our And to value are find that as to that offerings are will earnings our some companies a calls, accretive strategic seek of

of X been going is -- as But should So that's recently And each purposely selective. communicated Bonneville the of very out year to say head-on, quarter address that process why [ph] and I was that's be as as on to reiterated been there. calls. as last an ongoing the we're or fourth shelf offering has that's it

So be opportunity when itself. can ready presents we the

Jon Hickman

Okay, thank you.

Operator

reached and further session. call I'd turn over [Operator answer the to closing for of to Instructions] the our any comments. We've back question end management like

Mark Newcomer

Once to again, for year. we this And very us. on like revenue margins call, growth, to we'd for continue thank are to quarter margins. solid And our following went, listening and everyone the how gross pleased plan net we with execute for

a and you of rest have thank your So day. great

Operator

Thank does you. That today's teleconference. conclude

thank for time line a participation and at your wonderful We you day. your disconnect You may have today. this

PaySign (PAYS) 6 Aug 192019 Q2 Earnings call transcript