RPAY - Earnings call transcript Q3 2020 | Repay Holdings Corporation

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Operator

Greetings and welcome to today’s Earnings Conference Call being hosted by REPAY. With us today are John Morris, Co-Founder and Chief Executive Officer and Tim Murphy, Chief Financial Officer.

During this call, we will be making forward-looking statements about our beliefs and estimates regarding future events and results. These forward-looking statements are subject to risks and uncertainties, including those set forth in the SEC filings related to today’s results and in our most recent Form 10-K filed with the SEC. Actual results might differ materially from any forward-looking statements that we may make today. only obligation today, them, or required law. speak not we except statements by any assume intent forward-looking as and of do as The to update discussion provide financial non-GAAP to In to measures. additional effort include references to investors, an today’s will also certain information these measures available of of can site. in earnings non-GAAP release be the a these the company’s to explanation measures as found measures An as nearest on IR well financial reconciliation non-GAAP GAAP financial our the call turn to would Mr. to I now over like Morris. Please go ahead.

John Morris

you, business discuss then and good afternoon, call, Tim the Thank doing announcements. over a give business We well to of remainder to third for our it I'll growth by today's followed review our an on executing wanted exciting how turn everyone. to On in is operator, we're quarter financials of hope the update on our the and and everyone staying quarter I third year. guidance first healthy. some strategy with

As almost you began business evidence pandemic results COVID-XX proposition can since the prove value our continued to has see months more ago. from eight for our the

to be to The have over supports respectively. few disbelief. which the the growth. loan QX and to high of we pay third debt funds and profit The also XX% growth has has stimulus QX on organic accelerated electronic card for to past across existing loan that a continued use to continue offerings pandemic resilient. repayments staying current a businesses are capabilities. For our our proven payments. the as see payment demand gross customers and implementation on electronic their and place will priority clients months reported Borrowers shifts in tailwind in very for down increased been payments significant We've our we of volume several experienced XX% our quarter, Similar in payment new and of

driven lot is been people the as macro by has have more used reluctant the There lending from to for interest very an increase demand demand seeing strong in lenders are repayments of use are well. auto the rates been a and positive out benefits of which public are on Lower in Other contributing space. increased trends loan auto who are cities cars Specifically car cards and to us. accepting moving transportation. which payments clients are used more or

the looking Digital Our consumers penetration to customers more effectively wanting future captives. payments the one auto are is allowing of to use for auto of drives for fastest more trend parts in consumers lending electronic channels ongoing are Therefore, more about look is including the actively one customers for which loans. our TAM reach address prime business. to engagement growing also of billion us our In efficiently. of for to engage our and we XXX is ways such terms market

as in originations future. well seen demand We've Our rates. service for of BXB the catalyst accelerated and enterprise sparked our nice have is to adopt well forced serve mortgage a a along adoption similar in and benefit. us and to as we electronic mortgage clients trends vertical, typically buying businesses performed positioning home interest mortgage payments especially been due low well growth That rates increased their the in methods boom to business low payments. with also automate servicing activity This quarter very refinancing has increased transfers in

borrowers as borrowers’ funds electronic funding directly towards allows lenders instant through see to to shift and is has cards product more continued send lenders which product our to prepaid payments. eligible adoption accounts bank debit that also and Our increased

with all growth quarter. our against trends. strategies progress quarter during strong the positive a made overall, So We

America integrations and usage business end we to including during existing seven expanding have now end payments that and XXX. bay credit a the continued with To in companies. new existing as verticals. partnership also brought execute the bringing signed during well have a by minutes our by processing. we wins discussing our unions leading software We great spend merchants were the total added which client at our acquiring for our our of of card cars quarter of on driven we finance mostly represents September. accounting existing CPS business XXX,XXX of partners with several consumer XX as with in payment of our want These to these computers approximately September, collective We quarter first acceptance the force. software we quarter sales XX new few adoption some to total acquisitions. the integrations by members. the of aided provider total When enhance of direct integrations advanced XX announced This the client and a is to to integrations. by which In QX real-time ABCOA efforts I from

union provide we During to partnership over credit unions XXX X a processing processing announced to CU*Answers million combined integrate for also services XXX the quarter data is credit card owned over credit unions. service union with credit a CU*Answers nationally members. organization. representing They

loan efficiency our enable cloud-based integration partnership over the mortgage drive the On Mae their X recently platform mortgage service the servicing we're and leading using clients accept will XXX customer payments, loans. ability to for very the with to Ellie side, in-home announced platform. has originators also origination experience enhance provider the to This digital about mortgage Mae industry. excited Ellie

pain processing become new service Transfer Exchange we're the one the So recently largest point large another exchange seamless the borrower eliminating of paper data borrower our from topic experience. it on of for payments real Service of processes, servicing loan for a a mortgage in servicers. is automate payments automates one flow, announced partners. our right by reducing we a for mortgage very routing costs the and lender STX intensive and offering transfer ISP servicer potential or services while and us target mortgage product one to also payment This And market a or more could be STX from another. standardizing process when solves to funds between sold creating errors to of their with distribution to opportunity manual transferred

product efficiency We this excited important are today's and accuracy very than about as new more are ever in environment.

improve played Speaking companies, of the of we the STX between announced formation levels six board in a transfers of recently comprised a who lenders. of role STX representing also mortgage the experts initially mortgage variety industry service leadership all advisory promote participation these standards implementation recommend services standards their the of networks. goal adoption and STX operating The of to is enhancements workflows consistency, throughout to advisory of design and products and promote to ensure the board to

XX. allow and completed This adding and our repay and integrations with technology important some to ACH XX with also will on accept and and money. ACH BXB XXX BXB for We easily the ACH merchants for our ACH XXX XXX with integrations level payments ACH save affordably business is software and processing to XXX This BXB to solutions. time X integration between transactions ACH

growth which Moving on M&A a to company. to driver for our our continues be

verticals candidates our attractive technology. integrated are players are high active. are growth and that from and very Have are large out have are acquisition with perspective great There that remains payment us. targets underserved a for need software. there for margins many Ideal pipeline businesses Our a

base has developed portal. integrated boxes. CPS CPS deepest sectors software services payment suppliers payment check the of education, over of is enrolled clients the XX,XXX and acquisition with over a and provider hospitality. which closed those an enhanced technology enterprise healthcare, CPD expanding platform, a across topic representation of automation their the serves in accounts payments and we and M&A, XXX the CPS government of virtual all that through issuance, of On database affects card proprietary recently facilitates execution BXB media, various and payable reconciliation ACH

the accounting CPS Additionally, over its to potential ERP opportunity client cross-selling and XX CPS integrations platforms. across to total significant by sphere with new solution software growth base. capture greater its existing has unlock has wildlife paid also

verticals as offering. into excited greatly immediately enhances very expands acquisition our are about We it BXB us the current new and

competitiveness of opportunities it's that the the From of two-thirds rare a past offering we're and win this of some side. BXB is a where are We've the in our the solution ourselves something opportunities winning way a the that folks truly both is one-stop market the comprehensive our shop for payable BXB Over to in standpoint lot on the are of accounts less Our space than be our Taking case of doing. to months capabilities is robustness for we up technology and Greenfield ultimate Greenfield platforms. over to XX one-stop receivable goal set that of competitive a because quality and other that accounts opportunity do a our clients. having not not markets. market in that our

a XX XX,XXX supplier software BXB of network includes now business and Our over over plus. integrations

volume annually our business. of excess to process parts expect X opportunities ahead growth enhance of We card ACH payment in with other billion cross BXB with including sale accelerating and

vertical, our overall wrap providing continue are total the in market trillion. bring larger trillion the their for fortunate helping team long-term been We're company this and to dedication incredibly we vertical. this our customers us space to businesses get payments the behind excellent we've Our this our combined hard time. resources I to and our this to be is in TAM proud growth of of in and service addressable be offerings and acquisition our instrumental a now With who the to of bringing together as development X.X in X.X putting BXB strategy, unify To make the veterans lot work strategy. really BXB every throughout up, growing efforts

become Tim has the as value into Tim? discuss I'll has greater XXXX. it apparent move proven turn and detail. over in that resilient With business to more our Our financials we to even

Tim Murphy

Thank you, John.

all of the quarter, QX our metrics. move I financial before on results In let's financial to Now the delivered strong remainder review key XXXX. REPAY our guidance results of across for our third

X.X of Plus APS and $XX.X quarter. quarter approximately $XX.X incremental billion XX% over prior third CPA was year's third payment over revenue million was third increase the an revenue the an of Total The quarter. the quarter. contributed million prior volume increase of third card XX% TriSource, Ventanex during year

additions CPA to expenses XXXX. of in million on the increase and of primarily the Plus. TriSource, Moving to cost to due APS, million $X.X Other Ventanex quarter compared services in third were The the was of quarter. $XX.X

down profit the million, On year's However was XXXX. quarter. and the saw and organic strong when the high the very August lapping gross $XX.X a recovery an Please growth of was amount the to over excluding in an XXXX flat editions in digits due third lower mix margin solid profit TriSource. we organic XX% compared personal QX. shift in the to of increased increase quarter growth September basis that auto repayments. Gross gross the of quarter. note the growth those but third prior was for August July now for TriSource includes Also Organic in was loan resulted the slightly to single

profit cross were organic $XX.X team's high September in volume growth $XX.X was million organic our our strong quarter third continued to outlook. was low in October to However, XXXX. us which million provides growth the in SG&A compared teens the mid confidence trends in and

incurred As in third quarter business combination we related transaction costs to a reminder Thunderbridge. with the the of XXXX,

impact those completed acquisitions. and due increased items from compensation restructurings costs quarter, year-over-year during to expenses were the Excluding our primarily added hiring, of operating commission share-based up the

with of sales future During payment direct plans by for the customer upfront modified making an in release associated certain sales quarter, reps for exchange accounts. commission rights we the designated commission

future Given and look We felt residual commission a very to and capital paid it or multiples flow manner. our in partner was productive restructurings ongoing use deploy low we cash consider good streams as sheet a capital. these may strength the additional of for efficient we in balance the

The forma net quarter loss $XX.X net impact general the third business quarter result growth was net million of million loss of aforementioned last $X.X to XXXX. mainly in compared year. the of to the increase Third pro business loss combination and the combined was of expenses

quarter in share driven by per million or include $XX.X was current which forma upstanding a $X.XX share primarily adjusting higher period quarter the count. tax of a $X.X that XXXX. third to share adjusted income decrease prior the not The as of million income period, or net pro as compared adjustment in the year in was well $X.XX we per Third did

year $XX.X adjusted prior the quarter was third million, Lastly, increase XX% over an of third quarter. EBITDA

in EBITDA XX% Third APS, growth the adjusted adjusted total of year quarter. as in revenue This and the Trisource, a and Plus. was third contributions to as EBITDA XX% quarter Ventanex result percent increase compared CPA of a organic from prior

used the offering $XX class in the million our below price we EBITDA faster we in LLC Capital. in per converted A share total increase company's to of public offering repayment All there resulted stock were public in invest no of are an million an at loan controlled public Ellie for In upside approximately adjusted XX.X XX.X are typically mid-September repairs approximately companies units by from and our to share. closed an flow of of proceeded but acquire Accordingly acquired a to stock the as this equivalent reminder shares a growth As the these the Corsair margins offering of business, the slightly want number future. common was Mae stock to however increase growing sold in aggregate an A shares, by continue common count. class common net they

investment and to been September REPAY we overallotment included with Stanley, Corsair us equity great stake longer in along them Corsair's want the private this As helping way. thank in company. four transaction affiliated year option occurred the a the equity There's the their and a an result relationship Corsair contributions by funds its all of the no team full Morgan exercise underwriter hold XXXX. for the of to which plus

was on the payments week. million of mentioned, was remaining hand. on of upon we million Xnd, $XX at last closing The the up $XX growth The million of the depending closing targets. the closing CPS of cash to certain November with announced of john may As paid $XX payable achievement become acquisition acquisition financed which for

positions liquidity strong. and Our very remain cash

XXst, forma paid assuming CPS. October was million of for As pro $XX

liquidity balance We the have $XX $XX of $XXX million. and million total sheet, $XXX amount delayed revolver capacity of undrawn of cash of terminal draw in million for undrawn million capacity a

five Our is agreement only net pro availability we credit current now leverage draw the of times, note that leverage period recently times. the being for our in forma only with level covered term loan. Please below which X.X extend well material our change amended net delayed to the is

As an had September basis. shares on we XXth, of XX.X approximately outstanding million converted as

share including equal end. diluted as quarter approximately un-invested of Our count million shares fully shares XX.X

Finally, remainder moving on the outlook the for year. of to our

volume our growth continued have mid As organic in providing remained high mentioned I October earlier, strong confidence to us outlook. trends teens

slightly However, to continued margins. we our increased business, lower and TriSource auto have resulting recovery to shift see of mix is in which

to has typically few benefits. past personal volatility stimulus has then loan Our the lack margins the and introduction experienced which of some business higher over months due

to our We economy around this expect volatility first the we may of we're the this margin fourth year. more while in these profit in period expect quarter this continue of to uncertainty quarter the and be similar all gross pandemic. factors, of Due to

us and be In continued to due set investments addition slightly are we in we technology to fourth down in EBITDA adjusted quarter to margins expect product sales, making XXXX. in up the growth for

education the prior there contribution to two please seasonality in be quarters. added also media QX may some note it in have has and concentration is however; not from this We equivalent months which sectors CPS in business as contribution means of

$XX a million million be thought was to narrow Card Total our to Finally, to we it XX.XX left million profit and billion. be to between billion with payment following. and $XXX quarter between EBITDA and between volume $XXX $XXX be between and the million. be and revenues report, range to million to adjusted best Gross $XX million. guidance $XXX to XX only

further COVID substantial quarter. with quarters in seem ranges As no which fourth could prior unforeseen this duress to the economic create impacts related

XXXX. market, the turn enhance and operator have back to Looking and expanding we I'll Operator? heading several significant into over the pre-growth acquisitions, our momentum questions. continue your call recent now additional members new forward, to with take integrations, team to software our addressable levers

Operator

[Operator a Research. we proceed first Our Autonomous this be with question Please from Maurer is session. will At time conducting question-and-answer Craig Instructions] with question. your

Craig Maurer

and Tim John Hi, Yes. thanks.

So, we stimulus margins as and does your leave get EBITDA, that about business under I will continue segments your the there, to of revenue that guarantee within was present Yes. personal or terms and into the composition pressure first I if expect to to should you not thinking should business some vertical. you're color there. how volatility of what improve? different a is vertical XXXX, the however head additional loan Obviously, Thanks. wanted in not be the between on we want

Tim Murphy

This Tim. Craig. Thanks is

was repayment, So the loan mix XX% other. of the XX% BXB about business and XX%

really and excuse However, reduced QX coming acquisition toward that of now CPS BXB be me, repayment, expect forward saw origination next volume we just XX% out more And BXB, this going XX% like heading is that into with the in personal loans happened other year. dynamic. that less loan originations is loan then mix repayment, what so shifting result XX% we and to more a of XX% quarter

seen with positive trends have October really larger We personal of lenders we've some our more seen volume. in where

good And and commentary visibility has around expect we're keeping the October just it's so personal closely and see close the loans. eye we're lack of on that of in just we and of about QX, with where that given feel to positive monitoring it some But a year. something in margins going we that's next been into trend part

Craig Maurer

All you. Thank right.

Operator

with next from question our question. Barclays. El-Assal with Please proceed is And Ramsey your

Ramsey El-Assal

my question Thanks Hi. this taking evening. for

You with mentioned opportunities some CPS. cross-sell

order to noticeable of which help terms maybe kind could a the all just or color also you've cross-sell for us degree maybe you done. more year? us impact in Can acquisitions dimensionalize of So and recent that of the but specific us give next opportunities CPS, on rank have the sort

Tim Murphy

Sure.

So, can solution on the sell CPS. their AR CPP APS within first and take it customers our the AP to and one is We both side.

time to AP. acceptance now where they're for been acquiring of they're system we example of similarly and offering example where over on of and solution to And could APS been acceptance able a payments. demand CPS's facilitating an AP both there's a happening customers those are that large hospital acceptance card customers, And services. deliver has for maybe their So lot offer with services some for conversations not

I have want fronts in and getting going So goes next those some actually think more out into internally both we're to roll and cohesive way way a initiative around definitely of starting discussions on year. that to both we organized it how

see fairly both force. the starting but still sales to happening within it's we're early So of those, with dialogue

Ramsey El-Assal

question. bit is elevation of I kind also you Okay. you of And to about, wanted higher ask a a if there

and I even think then, a And and a of within mortgage as mean, auto we well. repayments quite seen looking loan areas XX business If looks become to you deals target you unions we you you opportunistic you bigger another fast and drive particular guess you're of that certainly have are part acquire come forward have end a M&A a to mix part in example. think percentage a sort diversified months sense? for. credit REPAY's make you're do now I all in it's we've A the I repayments doing, like? as way just Are certain if mix few down diversification that five mix how of say for direction of basically years Murphy XX we're years, Tim - loan asking, solving the have state? kind where a do We has you of can Yes. increasing that see a of have more percentage or in chasing don't for BXB increased and that, much bit a specific last solving the

XX, and And more probably was know XX, with XX forma like XX, mentioned and XX it's and into and other of that becomes we probably like looks terms the prior what today. that to XX, next Pro BXB then previously, now repayments, XX I and loan CPP BXB. so CPS being XX, XX that in XX, year it

It's to to room shifting it addressable percentage. a we're necessarily a market grow, lot with specific but see we not just for very a So large BXB. of solving

John Morris

probably heard have I watching, Yes was say the there. I'll to been the for Good before, we me and XX afternoon. as Ramsey, opportunity John. this watching you've add have opportunity that BXB years been is

there of the before acceleration we If more our last are and theories obviously of you pandemic on and and digital pandemic payments we way the shift bought APS of correct of proved that. some year was seeing to remember inorganically more the

the been about. it we've to fortunate that good and all a has was us area blessed So go talk attributes that it to we for

try it's continue the think there's mix the our we opportunities. find we do you're opportunities marketplace is We you match significant chasing We will. to drove in the think the picture on integration can for the of got to there our change projections be look vertical from opportunities rate, runway both obviously to opportunity acquisition current we attributes well vertical, term. matter if of, to vertical for have to those. the just to long there. go will growth kind a in Without we We there listening significant. growth organic growth and what big but be So the are is and we think organic that But we're opportunity hard achieve there of some really that. to are that opportunity we We it the as of opportunity out a are another see that mix. probably really both and to look if as the if From a with inorganic we of loan many markets those acquisitions change don't years significant growing we repayment can left necessarily well, think software who look we very to it's BXB

Ramsey El-Assal

Great. Thanks answer. for the

Operator

Please Sanjay your is KBW. our next with And question. from proceed question Sakhrani with

Sanjay Sakhrani

Thanks.

to XXXX is First for stimulus if or there investments quarter. growth on you as air we as for it look year What front? question planning does are if far Tim, about pocket how and you the isn't? I guess the the stimulus of like that guess its I there as and implications ahead fourth talked mean

Tim Murphy

Yes.

It's and sales high really quality now in trying is it's very investing product opportunity. acquisitions, to are BXB we've service customer investing a investing in market new technology been a we So been and very those verticals sales direct of also which to force We and underserved on auto. what provide perspective with in. attractive from and acquisitions. strong but focus and hires a through really, best, only We've that's think been we each these large do not

And the to or think is like and those can't saw at predict personal if October we just stimulus trends that's something to with stimulus in can we if necessarily look should try and what so, lenders customers we for research there related looking and those example or closely of up customers underlying market nicely that very get is us about it, a timing having our sense but also do monitor be top and discussions for some sets trends by we and projecting. we what's

to and to data much could auto inform timing the just of are on our key like possible arms that with with as and scenarios as without So investments BXB. trying stimulus also around and what focused just look get investing but

Sanjay Sakhrani

assume can how will probably hit guys growth guess think you just we can your matter some guys your think, stimulus. how a sort there rates about you you targets? or It's I it's as large or small large you hit I historical think growth small. long-term and I whether be Okay whether mean of of

Tim Murphy

longer talked teens felt term confident the to We Yes. organic high mid outlook. about growth like we in

announcement had of Ellie STX lot and the We partnership momentum and of good growth partnerships. auto our to partnerships mortgage. then most this to and had we've a have We of the a in space. have there seven related recent really credit and announced Mae mortgage signed have just unions. we've three then so for about targets BXB. avenues success that positive in through We a out addition and that's now year area in the another we quarter in a We've really-really talked lot and lot We

parts I growth think will do organically then and down is I one just the us different business avenues business what trying set acquisition of the part the for other growth be confidence is to lot gives combined mentioned. through up a that So and if ourselves up or organic either of of we're that outlook with

Sanjay Sakhrani

Perfect. Okay.

the where little like more. Just just just characterize of you're you looking? of could one sounds John follow-up bit for It pipeline but could maybe and talk M&A maybe area like sort a BXB to you size

John Morris

Sure.

that. just kind transparent can versus well. our best but and drawing type that's also something to we're complete shutdown could me not Listen giving also at again significant and Tim's guidance comment of things here also like public We're with absolute Let we we're everybody; best of trying be trying our have on numbers companies. looking follow what last be is everything all any as a to to see that

XXXX So we're praying have that in what but things doesn't not see. now seeing actionable and exist the obviously how could from pipeline that but that again see very happening on we we're hoping on impact we an M&A it is

that don't We've in the numbers still there on forecast out and We have to never we do were from five to forecast an blessed a really like will to some very obviously last been since acquisition. have we public. opportunities those. those acquisitive have done we see acquisitions to to We good We want do homework be we perspective.

specific also as are done into where we've see in We and that what we very very particular past about sure incorporate very how can and our the to you we measured make want organization. we're those on

and marketplace to coming see attributes some for in we they're with the several attributes. We market. these So that those look

are our money. We with and going diligent patient be shareholders also be to

some opportunities there. can So be There we're excited out though.

Sanjay Sakhrani

Appreciate it. you. Thank

Operator

question. Jeffrey proceed Please from with is your Andrew question with next our SunTrust. And

Andrew Jeffrey

the Good afternoon, guys. Appreciate taking question. you

when a but when discussing payment that the you're that detail and wondering significant think think integration. I I'm payment about maybe be mix might us interesting volume? to you I a an vertical talk is start conversation be you some STX Ellie John sense for, a about as perspective? this that's the to to can we talked in mortgage think about to pretty think you you more mortgage some one revenues of assume especially going as XX% able give in you from

John Morris

Yes. Sure.

think that's points there the a solving term just kind entire opportunity and opportunity of you about and exchange solves we longer foothold a allows value that's like creation So eliminates We a would us putting we to lot to that say gain of for the other into pain not I those additional years. It meaning anything are very haven't excited industry. there. needs together but over really term also we're friction solutions very us lot think if the investment in the long about specific us of that lenders payment couple next and seen for it a

So we patient long-term ask and into that a shareholder creating because create developing opportunity will see we move value us be and asset they'll integrations over as with and there you time. significant to we significant

immediate do think which as really that we but you happening part sales and additional kind see happening those kind build activity we decisions take wins be do say cycles of term dollars. that move bump when but even use why looking measured also a we the an time me we longer of think not out wise banks there's first out. opportunity and it's through and we're let's On there involves is will it large mortgage of So of we conversations we see as into moving but see XXXX XXXX this we more are hear in especially

Andrew Jeffrey

Yes. an opportunity. exciting it's Okay.

from please this it's is but this like On current it revenue and a deceleration line or organic an former or which the to growth or correct is mischaracterizing Is that demand it so. still pro underwriting issue demand? that there's I'm if the consumer personal coming is XX% it of extent loan which business supply, seems front me

Tim Murphy

a repayment of that. within clarify XX% the to loan loans Well XX% just personal is to part

the mortgage that is Canadian our rest unions, So there's portion The auto about business. and a of small still and probably credit that's then XX%. balance then it's

out just than dollars So personal there of cash but so were into less think loans tightening lot trading wasn't probably CARES and were that there lot a were maybe is loan were stimulus consumers and consumers May benefits business standards. flowing were really a a maybe down lot a I out cash also June. excess originations was with so their demand throughout about there and half paying underwriting of of they unemployment were happening started lenders the and and was April loans, act even repayment the part flush when a and total money down when and credit of little because and enhanced a half that There

However, of the have think needed is July now what see and consumers because in the cash the as personal August started much there trend understand we we at trend becoming probably in September to that or when time kind end to loans a resulting is of we a stimulus And we benefits more our picked originations so out trend and in in system back ran demand bit wasn't a data October those and have to see and now of that and the think occur that's started into will we and that's is truly repayments. if what August little that September end are at need last. a early

payments margin our originations direct act volume higher personal slightly bit what and certainly and play margin a hurt held it's this think a repayment out though but driven margin that's auto was So auto that's even is a loans TriSource CARES so seen of it a and as then just the at by well. how volume it's strong little that we lower lower TriSource helped recovery really quarter to felt with individuals and potentially but we've I

Andrew Jeffrey

Okay.

to just tighter in any a the XXX% that demand So you am underwriting sense personal that have way being blunted for back these strong I for clear by loans don't it's has standards. extent come

Tim Murphy

but it's repayment starting see origin. started our have No, started in August originating volume to we're and may been I a where I happened aggressively September that and that said they loans more think lender on like now. think the I that period there short

Andrew Jeffrey

helpful. It's Thanks. Okay.

Tim Murphy

doesn't For what were a demand also we take understand means thing can a overall to for we that we're and issue. particular cash, less again a long That's in not they think have turn. piece consumers. they good more It but it's that that spending cash book of our remember lender

Andrew Jeffrey

Right, sense. makes

Okay.

Operator

Peter And Davidson. with question. with our D.A. next question your Please from is Heckmann proceed

Peter Heckmann

the taking afternoon. Good for question. Thanks

so range? $X $X $X some an million, quarter in the acquired think, to fourth million, million, TriSource of at CPS amount in but million the $X of thinking to and million, million just or $X here $X is Just quarter back within clarify right you'll something trying numbers the the and about in into -- million, revenue terms I then $X that about

Tim Murphy

revenue of in Yes. we'll APS yes we've organic QX. the and included TriSource XX QX, basically thing but QX for same that incremental and do in with the and right about them terms sounds growth numbers pro forma then for

the both in numbers. they'll be QX So

Peter Heckmann

it. Got

you next the of for in just then And about rest think can quarters? us contributing sense. relatively prospects with and quarter higher of let's the a say think the makes Mercedes-Benz terms you That or and of when current opportunity you there couple a would how some that kind they're are Okay. probability of size the full remind captives captives was

Tim Murphy

space we and processing add and they so well. ramp to just with and really discussions month relationships trying each been we started in brands May going the to our each others. relationship so continue and continuing network was, in auto that's and We're the That have through been that captives are them seeing just and volume with month card have our of up other

been it's four but and been those you guess As discussions ahead put in we've we're they long terms we're we're of in sure going the and about that of or cycles that on make are where sales and relationships of sort renewal trying well. have know, make get really I might we with really to those now sure discussions and now captives our we five or for so are that's to in them Mercedes and processing well months additional fees

Peter Heckmann

Thank I Okay. appreciate go. it. Good you. to

Operator

And questions. our Please with Vafi from with next is your question Canaccord. proceed Joseph

Joseph Vafi

volume just wondering of just integrated if so economy provide on wondering and guess also acquisition of of more the was for cost of over putting lot back follow-up. of the I integration a end payment certain different not Clearly capability I afternoon. quick a the technology the degree in we I here and switch a good I does to provides thoughts ground from guys on or synergies Maybe know could to stakes areas Hi have the kind you're side in activity some some on here tightly integration business. maybe kind then to M&A get the activity. that extent

John Morris

just about integration acquisitions? of This is the question

Joseph Vafi

areas if side potential into perhaps look stacks a a Yes. at business platform on some you're these business lot for the you integration you've to to address and single I of of kind mean different of across payment you and focused do the your integrating different this think various run got that payment or buckets the point?

John Morris

Yes. I'll is sure. John. that. This take

So actually Plus. in APS, the and with Ventanex then integrations are our on on and CPS last actually Starting months the track XX target.

on The we first there's an we've changing TriSource two been and have it's well has integrated our and through a over of on that settlement clearing done. platform things the asset the end back operationally been to most were more those successfully acquiring just few gone APS piece

I as side technology around we're also determine have, parody and looking acquisitions said to integrate but into streams on point lay look already we pieces feature understand the from work ultimately from perspective with they're of actually most a we them in perspective. it's think parody we sunset. how stop we work work technology get to we So do as We how on in. and to that the streams out XXXX back all piece feature our forward for great a on stream do And all sale and those going I we of go integrated the

on assets. track those with We of all are

Sometimes those also up some really some picking are and technology some good picking key of we're integrations. up

your you the are So whole critical CMOS do. integrations of even as piece those payment will that we be, with technology to to it's important through work integrations have the piece

streams work going So are those well.

we heard on and opportunity to together little APS kind a there's talked pieces automation consolidate across as As me a around there sell the side while of but about and to there's side. the some well, the we on piece between AR the that and demand. in some see then you one-stop come as of to BXB us put opportunity those as the together and say integrations BXB take think one-stop shop AP with technology this well side, on put the we early on call shop We together that'll

Ventanex ability as technology intelligent acquisition that. things heard So of platform it you seeing some it's do pieces additional the merely some that. features about there, we because the to to overall going we're be of several does talk of that to the routing, plug mortgage, into And that the our needed great us our

complementary that stack. So entire our part technology a very becomes of

superior that work complements obviously makes work, our and we that to already we're reiterate that is about that buy our unique continue what then do. technology into to duplicates technology financial the ERP sunset consolidate all a streams we well us technology or integrated ad overall is to possibly also payment So want to goal this systems. processor we technology is, What's that has sense, superior there and

engine on print and own engine well checks. and We the side as clearing own on funds. settlement card have mail the settlement and ability even settle ability well as to We ACH our own our to as and as the we move our clearing side,

said a stress companies company. as much great we've as fast-growing in end-to-end are as looks everything pieces to who Overall, we continue total our out XXXX. technology out We'll those acquire that solution together to don't and continue and continue the finish people some have and this. parts excited OpEx help a before, to about there of we're have we us we build So assets we accelerate with to always when I We we're put and want that good in there. growth synergies the acquisitions. fast-growing people acquiring very our

some that because formula there. time that's think build of side. solutions you'll Most is synergies. why, the excellent our forecast of of in be provide winning we'll that will kind part this OpEx on you obviously we So continue see oversee of around us technology synergy suddenly invest And processing and type it us the any to business

Joseph Vafi

quickly That's if just outlook into call Sure. it looking for, organic you're John. integrations then Thanks And the kind next helpful. let's year. of

Some opportunity commentary integrations the and penetration guess end some your and that then in penetration, user there? existing Thanks. I around of

Tim Murphy

software In integrations? terms of

Joseph Vafi

Yes.

Tim Murphy

software quarters recent lot those address their been see own just we we've verticals in to have, those because have verticals and that accelerate to of has you partners. more unique We each able a now

we so to going coming to recently them think lot get times helping able our often are do across have benefit resources. just now focus now we find of but that reasons They able have, term. that. lot during on they been and the to from really actually finish those helping with resources up we're them acquisitions toward for that there's not longer line are we're been and that a putting to And partners that's not us various a or placed want them diligence sign that's something because them so we and of And

being these think so for to one just accelerate And we other able businesses example of that's growth acquiring. with

a of without be for simple ourselves a channels. or may increasing web and offer how And mobile penetration payments or all share, so, transaction particular lot there's maybe perspective of these but in different the phone the or example payment different penetration on other electronic from several focused gaining like not customer them a IBR terms not of see a lot web-based within just we we their providing providers, That's as the partnerships. base, vertical question, the have channels or

So that avenue distribution us and very something it's for a we're that's focused on. key definitely

John Morris

of on, benefits great That'll as as think that one substantial long-term we supplier to network over create we bring build supplier But us list customers that's and future those known Yes. be a also cross-sell over network some And with customers those obviously some much our we we've some, those. since recent a They'll time enhance as to acquisitions. have I it of as inside were those XXX that we're represents customers would that continue software creates continue of acquisitions, you, continue services add time. integration those out I we've want if you builds we've to we continue partner not look now probably we as each sure out really them or to that emphasize, to already network of of opportunities with to want doubled GPS many lots think over have to to that all that it's our that, XX,XXX of it build now we perspective some integrations. out to build almost, through most of of as over to opportunity we existing that. opportunity

Joseph Vafi

very Thanks That's all have. guys. Great I much.

Operator

next is with proceed with Our Blair. questions. Please Napoli William question from Bob your

Bob Napoli

the the little you. stream, transfer and on that would Can revenue give stream the afternoon. question Good I Thank color Mae. who business coverage Knight be with opportunity The revenue on the in you you what recurring Black competing likes exactly are of that see helpful? you are and Ellie with more they, the mean the nature of business. servicing a mortgage the little bit servicing, the of

Tim Murphy

Sure.

So Black Knight partner is mortgage actually a software services. ours, software provide to of so they

on partner. more is they're So Mae focused Ellie software originations.

there. competitors. now happening ACH ACH. It's electronic, payments all would of pretty a but heavy partners necessarily there's become it's not be those right lot us still of So And

And initiatives want our model. and pay example We Ellie a revenue we a and it One so increase card volume which a per or for to to based to us then transaction convert penetration, a is for referral of more that some model. would it's would fee be to of card Knight. like Mae to based convert revenue Black hard of partner

to servicer with of for create so and transfer and of we're oftentimes mortgage in escrow processing could that payments transferred first be efficient it's can we're why our activity, were that's recurring it or originators where Mae we not servicer that There of kind service it and errors likely using they it that a has lot ongoing platform. activity their that. make would there the get if payment. complex done the and more then fees initial the we get customer refinancing be processing fees We and to the mortgage about most kind related X,XXX of be would We would Ellie be, trying correctly fees. involved involved that processing if where maybe and automate in So is involved in closing appraisal there's a

Bob Napoli

of models kind revenue of between the is versus How on difference business side? the And the question AR business much the the between, business? in profit the is, and the on AP side on then, side streams pure the payments the that how AP the there each and revenue Okay. transaction models difference AP the you. on the automation business and BXB like the is those there AR software Thank revenue much a for AR of revenue the

Tim Murphy

typical discount AR the rate. on side it's So a merchant

to businesses So in transaction. a we're doing acquiring based merchant card business for business

partners maybe where on well. bips we a the model but similar we're charging also on points then AP then basis the rebates and so we where very fee are side we're there's and interchange pay card on usage interchange also have rebates and then our we on processing side that's and revenue might on it's And pay volume issuing basically and for getting transaction the model the So volume, per as is and virtual then involved there.

the the in but to of its it's per part the we're subscription the it acquiring sense interchange it's points that month, fee changes volume similar or revenue on also the us. not merchant versus side where the cost based getting on it's So basis flat transaction

Bob Napoli

Great.

John Morris

and would automation data the There a on all be also volume which percentage and of AP transfers. side, to of automation designed is reconciliation ACH concept seamless that's the enhanced for

potentially ACH and file that but of then where of There is AR on checks on -- the side. and as predominantly transfers just is transfers the is you have well automated So the there that's that of AP some mailing a version which normal as well, may even large

Bob Napoli

do launching on fees? piece what's kind pricing the the you're you And then, that instant expect funding and of John what funding instant penetration rate the

John Morris

That’s transaction. per Yes.

transaction feel to that's fee. an but going per that's a So ACH something like

for it's as we're it there. for margins that early in to are really, just We're their are seeing an it it's lenders of transaction are growth good our exact penetration predict specific we much seeing Bob, see kind using on there. the activity We're much still not rate right penetration a but we're it So our bips of really not that users transaction seeing there. for percent using but strong be would starting over

don't more so see seeing automation going, a yet So you it's the seeing and as and more, how sense that. quote want can, see this wanted little one to just efficient way uptake I more just but we're that's to seeing and it pieces we using common we're also we're says people

Bob Napoli

Thank you. Appreciate it.

Operator

from proceed Our your next with Suisse. Timothy question with Credit Please is Chiodo question.

Timothy Chiodo

Great. more this well call opportunity. the bit opportunity. lot. met Thanks know want this into automotive captive earlier on to a provided quarter to you that the little I account I addressable the as in your analysis for a last better you've dig slides and you've increased market

captives mentioned RFP and You any us timing that at could of look or just some the automotive mentioning give maybe also so XX not of. you get renewal In etcetera? omni top Maybe but want just ahead what's us when light status are the processes to they quo method. give that specific, earlier the you we their sense channel, consumers status repay to an is. It's it loans? not ACH? of up payment to one a just it multi-channel, what quo? What offering now Is set the Is the

John Morris

Sure.

large very different hear anything give market like to is cycles or me want don't addressable various smiling. quoted So names and it I any but that you because you

sales cycles. So it is longer

complete consider here if the an and some an of patient be in They would to maybe an across or solution online solution you the automatic or again, mobile payment draft for a but board are ACH presence have ACH be many omni-channels. what So merely, specifically maybe be or but well. using tech ACH need they omni-channels that the mail an IVT who a would the there then solution we it's a not as captives those of kind if meaning even

So of take but to concept the a of being take in is take generally that I think exists presence card. that some that those the to XX/X a first presence think payment card with ability there's exists don't able definitely web a even debit debit there few players and the we still

have a be functionalities can are to there's that auto we would been that us. competitive think win the debit plenty after We have It's in re-lending to get fair then Yes. win of tell but who winners and space several and our there that don't features if and we a we everything certain should for have taking do create built card case well. share matter and there there's we just timing we but our win get story. Now

Timothy Chiodo

workflow Maybe to the to just a good payable, the A I process and to example use important payable. us enhanced fully part could and quick over That this the little send What's offering use good. Thanks is into reconciliation use case that when's good use came dig or accounts sorry, the to time allows ACH? virtual CPS card? In bit of follow-up bit you minutes give enhanced a a couple sounds recognize data. remittance a it's what John. back little very in you mentioned want in just a words accounts you It's ACH relative a case other for good from that traditional it for good just ACH there.

Tim Murphy

efficient a virtual it's data more cost ACH. they're want fees, conscious want balanced is where if ACH more about card product think a straight but enhanced workflow not I and the

and low but much cost you're as doesn't the So data isn't getting quality also cost better it data transfer.

than of that hence and the certain a costs it not want in want more there's so card same and but product balance out there that that virtual is bit a just product. little kind between ACH, that why which players traditional So and

Plus and more as can we'll cost way so a job probably customers but really us and And to little make price to become and a it something that the in more better I good and is the think card continue with for bit lower similar from popular why we now is has a because it's a transaction CPS that well. to economics the that and to can so done you CPA perspective us our that's also bring

Timothy Chiodo

That's very that's Yes right. Yes. good.

Tim Murphy

and aware those you to that got let reconciliation when attributes spent data. happening. of has look are We it's tremendous XX a you're if down to if drives AP bulk That in attributes a but many costs. of to go kind thousands that you certainty or got do up check clear it's And a experience. on hours someone we where could just can one would value man of and and you the system. can ACH drives ERP payments the hours very and those so and of kind of how you there's you There about payment file attributes are It find to amount big of at a eliminates whole different and funds if it’s hours whole and into you of in We settling and back it's and to man seamlessly and other funds it's it XX have the supplement about obviously all speed when can exactly the need one-for-one were you completely various these and the and for now the XX can exchanges about link tremendous is settle per concept. show get then that settling one then drives imagine be they're digital you listen of move in five large Tim need and and file movements it like world that reduces errors pay

Timothy Chiodo

Excellent. Really John. Tim the appreciate overview. and Thank you

Operator

And is from our with question proceed question. next Please Stanley. the Faucette James Morgan with

James Faucette

but through get acquisitions a area acquisition. thought going single go acquisitions, the the Thank revenue acquisitions and of all you. at work within etc. to your done the and to now acquisition least that might and think look how to sheet indicated just you come are want to understood still by correctly to there potential that be the about? through to we I to in on of multiples diversification or to would thinking likely topic that the much have ask flexibility you're type, do I market can end diversification make balance sure at stream most capital you hi looking diversification incremental wondering mentioned but at right John, you that have acquisitions Hi be structure that if that I'm some Tim. you wanted in I you do or achieve same to you you

Tim Murphy

Yes. Sure.

to just credit takes organic time like have mortgage in out that up if areas at more and acquiring be time So just overall include XX%. CPS is call the focus it's bring I of move is merchant a percentage a within enough organically whereas and look for now we where think although mix zero just so want that's it's or probably did for take deeper comments around have diversification with BXB within we've new that like our that that the something look to large acquisition there and to solid a opportunities happen to XX% one we the we're there the up AP just to above we'd was it on could on and of go didn't side. and to about you acquiring really existing BXB verticals We seen standpoint now going as those where year to opportunities versus looking so at from would so other that business acquisitions organic way unions, verticals AP forma and we needle an We and a be great can percent. BXB ago actually away percentage example shift the mix right pro

tap we probably it and point what the so feel some strategic leverage doing we're similar we've net comment wise would then So times have markets I called and today. X.X to to and deals up X.X at that flexibility to at X of larger and balance for going was comfortable the really think been look equity we sheet to but very the something was have we'd times to if in that. size something do there then

if financed. was be So have wouldn't flexibility something it some it we do to but more M&A larger all debt

James Faucette

may, Right you adjustments you this sense that in guess I the made color makes commissions. then you quarter provide some quickly and on

you group? because markets your be should bit you commissions you'd industry Do how the case are the I maybe previously expect about mentioned to new of merchant we lower that part think think as a than that or you enter control expense relationship. the

Tim Murphy

Yes.

to on able we payment will very lower market provider it be more us make focused have not very we focused but some commissions these that payment those Historically try enter these we to competitive destroy sure grow volumes markets think we're been existing an in way of already we we have reps and with and a we a are and could from allows than those rev or the as so with point your some and So to but typically lot structure like to that attractive they then shares we that can either new this make restructure quarter deals think particularly good benefit sense ability providers that partners, on or we've too. do, we to of partners and if did shares. own with there's our do several at of direct rev sales that multiples margins those we

commissions we felt another So cash could that's enough and just like bring P&L. to we residuals are look just that partners for could the tool more use paying to we to were large our are dollars we flow of restructure them

James Faucette

Thank useful. you. really That's

Operator

Securities. Please Mike next with proceed with Northland is question our from Grondahl your questions. And

Mike Grondahl

of your compared the of Two an does your the bit maybe area is secondly questions and of just any pipeline's then there one outsized to pipeline have lost in the of different turmoil space through lender a kind business volume you verticals guys. your that kind the thanks volume where the this or Yes, ISVs little personal summer? customers in map loan

Tim Murphy

to addressable we're It first So more know I that it focus just question, maps market where trying the resources. about is really opportunities. with one-for-one don't

still just versus There it strictly new do lot want this is want mortgage. we to placing to kind example resources still stressful auto to there's a do where get in a we think find of a So largest to and for find of size. there's in partners of accelerate and growth, more strategically be want so some market and [Indiscernible] to few distribution we the mapping where way we

tightened and personal volumes be was weathered damaged one-for-one point loosely underwriting fine lenders It's of and we terms aware this just think their larger are where they but that some pretty ones balance not and would of that are of any have own and it's and that we're We're lending be of aware the to So longer not ties used been they've still our same to to contracted either the lost that kind no monitoring that in personal they've out then as probably business. or of any of originations we've their credit through well. it or lower that sheets demand lenders.

Mike Grondahl

Great.

Thanks guys. Okay.

Tim Murphy

Yes.

Operator

also and participation. And for this your Have you Everybody reached today’s this of Thank lines question-and- answer end concludes disconnect your conference. day. session our at we the have a good time.

John Morris

everyone. Thanks

Repay (RPAY) 10 Nov 202020 Q3 Earnings call transcript