REPAY Expands Partnership with Hotel Investor Apps to Include Accounts Payable Automation

REPAY will power Hotel Investor Apps’ accounts payable and accounts receivable payment automation capabilities

ATLANTA–(BUSINESS WIRE)–Jun. 15, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY”), a leading provider of vertically-integrated payment solutions, today announced the expansion of its integration with Hotel Investor Apps (HIA), an ERP & accounting solution with unique functionality designed for the hospitality industry, enabling HIA properties to streamline accounts payable processes, optimize internal workflows and securely pay vendors and suppliers.

Through the REPAY integration, HIA properties will now have increased access to a comprehensive payment solution with both accounts payable and accounts receivable payment automation capabilities. By streamlining outbound vendor payments, businesses can seamlessly pay vendors with increased efficiency and transparency, while reducing the costs associated with manual processes and traditional paper checks. Additionally, businesses using REPAY’s technology can significantly reduce their exposure to fraud risks by customizing various controls and eliminating the need to provide sensitive credit card or bank account information to hundreds of vendors.

“We’re thrilled to be expanding our partnership with HIA and continue our commitment to making transactions easier for our clients,” said Darin Horrocks, EVP, Business Payments, REPAY. “With a simple addition to our existing integration, HIA users will be able to access AR and AP payment capabilities within one platform, increasing operational efficiencies, maximizing revenue, and reducing overall costs and resources.”

“After working with the REPAY team to enhance our platform’s payment acceptance capabilities, we knew their services would be a great fit for streamlining accounts payable processes,” said Chip Fritsch, COO at Hotel Investors App. “We’re looking forward to expanding our partnership with REPAY and creating an even more robust platform to make our clients’ jobs and lives easier.”

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
khoyman@repay.com

Source: Repay Holdings Corporation

REPAY Provides Seamless Payments for Megasys’ Consumer Lending Platform

Through the technology integration, lenders will be able to accept and manage installment and auto loan payments on the Megasys system

ATLANTA–(BUSINESS WIRE)–May 24, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY”), a leading provider of vertically-integrated payment solutions, today announced an integration with Megasys, a loan management software system specializing in the consumer finance industry. Through the integration, Megasys’ customer base of consumer and auto lenders will be able to accept electronic payments through REPAY’s omni-channel payment platform.

Utilizing the integration, lenders can provide a more convenient payment experience that allows consumers to make loan repayments via ACH and card through online, mobile, IVR, and text channels at times that work best for them. The seamless data flow between the two systems, along with access to robust data and reporting tools, will enable Megasys’ customers to better manage cashflow and create more efficient workflows and reconciliation processes.

“Megasys’ experience in the consumer finance industry makes them a natural partner for REPAY, as the team deeply understands the importance of a convenient and secure payment ecosystem,” said Susan Perlmutter, CRO at REPAY. “We’re looking forward to helping the company provide the best possible service to consumer and auto lenders across the country and will continue to work diligently to deliver solutions that enhance the payment experience for both businesses and consumers.”

“REPAY’s expertise in the industry and their commitment to providing great service to our customers will add value to our comprehensive product offering,” said Theo Austin, President & CEO at Megasys. “With our new integration, we’re ready to offer a more holistic payment experience for lenders and their customers, while helping businesses improve their bottom line and stay competitive in a challenging climate.”

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
khoyman@repay.com

Source: Repay Holdings Corporation

ACG Atlanta Announces REPAY on 40 Fastest-­Growing Companies in Georgia List for 2022

 ACG ATLANTA ANNOUNCES 40 FASTEST-GROWING COMPANIES IN GEORGIA 

Honorees are recognized at the Celebration on June 28th at the Atlanta History Center 

May 18, 2022: ATLANTA The Atlanta National Chapter of the Association for Corporate Growth® (ACG) today announced the 2022 Georgia Fast 40, recognizing the top 40 fastest-growing middlemarket companies in Georgia. 

“Every year, the Georgia Fast 40 displays the strength and significance of the middle-market sector in Georgia,” said Melanie Brandt, ACG’s Atlanta and South Region President & CEO. “The sheer variety of the industries represented, which includes Healthcare, Financial Technology (FinTech), Manufacturing, Construction, and Fantasy Sports among many others, also demonstrates the breadth of investments and executive talent in the South.” 

Applicants were required to submit three years of verifiable revenue and employment growth records, which were validated by the national accounting firm and founding Diamond sponsor, 

Cherry Bekaert LLP. An ACG Committee of volunteers conducted in-person interviews with all qualified applicants. The companies on the list are for-profit, headquartered in Georgia, and reported year-end revenues ranging from $15 to $500 million and make up the lower and upper middle-market categories. ACG Atlanta will announce additional honorees for the higher middle-market category with revenues up to $1 billion in the next coming weeks. 

“These 40 companies represent almost 11,000 new jobs and over $3.1 billion in revenue growth over the last three years,” said Michelle Galvani, chairperson of the Georgia Fast 40 Awards and Executive Managing Director with Wildmor Advisors. “In speaking with many of the CEOs, the supportive business environment and accessibility of capital are contributors to growth. By far the biggest challenge is the tightness of the labor market. We are proud to honor these companies and look forward to learning more insights online and at the celebration in June.” 

Honored companies for 2022 include: 

Alora Pharmaceuticals, LLC 

American Global Logistics 

Angel Oak Companies 

Ansley Real Estate 

Arkadios Capital LLC 

Aspirent Consulting, LLC 

BioIQ 

BIOLYTE 

Bitcoin Depot 

Core Clinical Partners 

CRH Healthcare, LLC 

Dimiour 

DLH Corporation 

Flip Electronics 

Flock Safety 

FullStory, Inc 

Graydaze Contracting, Inc. 

Grayshift 

Green Worldwide Shipping, LLC 

H&W Solutions 

Intellum 

Irrimax Corp. 

Juvare 

KGM Technologies 

Lazer Spot, Inc 

LeaseQuery 

LendingPoint, LLC 

Madison Steel, Inc 

Merit Financial Advisors, LLC 

Moneypenny 

NPSG Global 

Omega Bio-tek, Inc 

OVME, LLC 

Paramount 

Pinnacle Funeral Services 

PrizePicks 

Prosponsive Logistics 

QGenda, LLC 

Repay Holdings, LLC 

Salesloft, Inc 

About ACG Atlanta 

ACG’s Global Network comprises more than 100,000 middle-market professionals from corporations, private equity, finance, and professional service firms representing Fortune 500, Fortune1000, FTSE 100, and mid-market companies forming 59 chapters in North America and Europe. Programs in Atlanta include M&A South, The Georgia Fast 40 Honoree Awards and Celebration, Taste of ACG Atlanta, as well as monthly events and an active Women’s Forum and Young Professionals group. 

 

Contact: Melanie Brandt, 770-316-0528, mbrandt@acg.org

REPAY to Attend Upcoming Investor Conferences

ATLANTA–(BUSINESS WIRE)–May 11, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY”), a leading provider of vertically-integrated payment solutions, today announced that the Company will participate in the following upcoming investor conferences:

  • On Monday, May 16, 2022, John Morris, CEO and Tim Murphy, CFO will virtually participate in a fireside chat at the Barclays Emerging Payments & Fintech Forum. The discussion will begin at 12:40pm ET.
  • On Tuesday, June 7, 2022, John Morris, CEO and Tim Murphy, CFO will participate in a fireside chat at the William Blair Growth Stock Conference in Chicago, IL. The discussion will begin at 4:40pm CT.

The discussions will be webcast live from the Company’s investor relations website at https://investors.repay.com/ under the “Events” section. An archive of the webcast will be available at the same location on the website for 90 days.

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
(404) 637-1665
khoyman@repay.com

Source: Repay Holdings Corporation

REPAY Reports First Quarter 2022 Financial Results

ATLANTA–(BUSINESS WIRE)–May 10, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY” or the “Company”), a leading provider of vertically-integrated payment solutions, today reported financial results for its first quarter ended March 31, 2022.

“We started 2022 off strong, experiencing growth across all of our verticals, which led to first quarter card payment volume and gross profit growth of 39% and 46%, respectively, compared to the first quarter of 2021,” said John Morris, CEO of REPAY. “We are making solid progress on our growth initiatives, including increasing our AP supplier network – which now totals more than 127,000 – as well as signing new virtual card clients, expanding virtual card adoption and formally commercializing our AR/AP unified capabilities for our B2B business. In addition, we are making progress on optimizing our processing infrastructure while also developing the best software and payment solutions for all verticals. Ongoing progress with these strategies coupled with the secular trends towards frictionless digital payments will continue to drive our business, positioning us well for near- and long-term growth.”

Three Months Ended March 31, 2022 Highlights

  • Card payment volume was $6.4 billion, an increase of 39% over the first quarter of 2021
  • Total revenue was $67.6 million, a 42% increase over the first quarter of 2021
  • Gross profit was $51.0 million, an increase of 46% over the first quarter of 2021
  • Net income was $12.9 million, as compared to a net loss of ($18.0) million in the first quarter of 2021
  • Adjusted EBITDA was $29.3 million, an increase of 43% over the first quarter of 2021
  • Adjusted Net Income was $18.4 million, an increase of 22% over the first quarter of 2021
  • Adjusted Net Income per share was $0.19

Gross profit represents total revenue less cost of services. Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share are non-GAAP financial measures. See “Non-GAAP Financial Measures” and the reconciliations of Adjusted EBITDA and Adjusted Net Income to their most comparable GAAP measures provided below for additional information.

2022 Outlook

REPAY reiterates its previously provided guidance for full year 2022, as shown below.

Full Year 2022 Outlook

Card Payment Volume

$27 – 28 billion

Total Revenue

$296 – 306 million

Gross Profit

$224 – 232 million

Adjusted EBITDA

$128 – 134 million

This range assumes no further unforeseen COVID-related impacts, which could create substantial economic duress in the remainder of 2022. REPAY does not provide quantitative reconciliation of forward-looking, non-GAAP financial measures, such as forecasted 2022 Adjusted EBITDA, to the most directly comparable GAAP financial measure, because it is difficult to reliably predict or estimate the relevant components without unreasonable effort due to future uncertainties that may potentially have significant impact on such calculations, and providing them may imply a degree of precision that would be confusing or potentially misleading.

Conference Call

REPAY will host a conference call to discuss first quarter 2022 financial results today, May 10, 2022 at 5:30 pm ET. Hosting the call will be John Morris, CEO, and Tim Murphy, CFO. The call will be webcast live from REPAY’s investor relations website at https://investors.repay.com/investor-relations. The conference call can also be accessed live over the phone by dialing (877) 407-3982, or for international callers (201) 493-6780. A replay will be available one hour after the call and can be accessed by dialing (844) 512-2921 or (412) 317-6671 for international callers; the conference ID is 13729100. The replay will be available at https://investors.repay.com/investor-relations.

Non-GAAP Financial Measures

This report includes certain non-GAAP financial measures that management uses to evaluate the Company’s operating business, measure performance, and make strategic decisions. Adjusted EBITDA is a non-GAAP financial measure that represents net income prior to interest expense, tax expense, depreciation and amortization, as adjusted to add back certain charges deemed to not be part of normal operating expenses, non-cash charges and/or non-recurring charges, such as loss on extinguishment of debt, loss on termination of interest rate hedge, non-cash change in fair value of contingent consideration, non-cash change in fair value of assets and liabilities, share-based compensation charges, transaction expenses, employee recruiting costs, other taxes, restructuring and other strategic initiative costs and other non-recurring charges. Adjusted Net Income is a non-GAAP financial measure that represents net income prior to amortization of acquisition-related intangibles, as adjusted to add back certain charges deemed to not be part of normal operating expenses, non-cash charges and/or non-recurring charges, such as loss on extinguishment of debt, loss on termination of interest rate hedge, non-cash change in fair value of contingent consideration, non-cash change in fair value of assets and liabilities, share-based compensation expense, transaction expenses, employee recruiting costs, restructuring and other strategic initiative costs, other non-recurring charges, non-cash interest expense and net of tax effect associated with these adjustments. Adjusted Net Income is adjusted to exclude amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions. Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although REPAY excludes amortization from acquisition-related intangibles from its non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Adjusted Net Income per share is a non-GAAP financial measure that represents Adjusted Net Income divided by the weighted average number of shares of Class A common stock outstanding (on an as-converted basis assuming conversion of the outstanding units exchangeable for shares of Class A common stock) for the three months ended March 31, 2022 and 2021 (excluding shares subject to forfeiture). REPAY believes that Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share provide useful information to investors and others in understanding and evaluating its operating results in the same manner as management. However, Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating profit, or any other operating performance measure calculated in accordance with GAAP. Using these non-GAAP financial measures to analyze REPAY’s business has material limitations because the calculations are based on the subjective determination of management regarding the nature and classification of events and circumstances that investors may find significant. In addition, although other companies in REPAY’s industry may report measures titled Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income per share, or similar measures, such non-GAAP financial measures may be calculated differently from how REPAY calculates its non-GAAP financial measures, which reduces their overall usefulness as comparative measures. Because of these limitations, you should consider Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share alongside other financial performance measures, including net income and REPAY’s other financial results presented in accordance with GAAP.

Forward-Looking Statements

This communication contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about future financial and operating results, REPAY’s plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as “guidance,” “will likely result,” “are expected to,” “will continue,” “should,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. These forward-looking statements include, but are not limited to, REPAY’s 2022 outlook and other financial guidance, expected demand on REPAY’s product offering, including further implementation of electronic payment options and statements regarding REPAY’s market and growth opportunities, and REPAY’s business strategy and the plans and objectives of management for future operations. Such forward-looking statements are based upon the current beliefs and expectations of REPAY’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond REPAY’s control.

In addition to factors disclosed in REPAY’s reports filed with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2021, and those identified elsewhere in this communication, the following factors, among others, could cause actual results and the timing of events to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: exposure to economic conditions and political risk affecting the consumer loan market, the receivables management industry and consumer and commercial spending; the impacts of the ongoing COVID-19 coronavirus pandemic and the actions taken to control or mitigate its spread; a delay or failure to integrate and/or realize the benefits of the Company’s recent acquisitions; changes in the payment processing market in which REPAY competes, including with respect to its competitive landscape, technology evolution or regulatory changes; changes in the vertical markets that REPAY targets, including the regulatory environment applicable to REPAY’s clients; the ability to retain, develop and hire key personnel; risks relating to REPAY’s relationships within the payment ecosystem; risk that REPAY may not be able to execute its growth strategies, including identifying and executing acquisitions; risks relating to data security; changes in accounting policies applicable to REPAY; and the risk that REPAY may not be able to maintain effective internal controls.

Actual results, performance or achievements may differ materially, and potentially adversely, from any projections and forward-looking statements and the assumptions on which those forward-looking statements are based. There can be no assurance that the data contained herein is reflective of future performance to any degree. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance. All information set forth herein speaks only as of the date hereof in the case of information about REPAY or the date of such information in the case of information from persons other than REPAY, and REPAY disclaims any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this communication. Forecasts and estimates regarding REPAY’s industry and end markets are based on sources it believes to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part. Pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

Consolidated Statement of Operations (Unaudited)

Three Months ended March 31,

(in $ thousands)

2022

2021

Revenue

$67,564

$47,520

Operating expenses

Costs of services (exclusive of depreciation and amortization shown separately below)

$16,565

$12,475

Selling, general and administrative

32,218

23,393

Depreciation and amortization

28,589

17,793

Change in fair value of contingent consideration

(2,900)

2,649

Total operating expenses

$74,472

$56,310

Loss from operations

$(6,908)

$(8,790)

Interest expense

(989)

(1,183)

Loss on extinguishment of debt

(5,941)

Change in fair value of tax receivable liability

24,619

1,043

Other income

6

28

Other loss

(9,080)

Total other income (expense)

23,636

(15,133)

Income (loss) before income tax (expense) benefit

16,728

(23,923)

Income tax (expense) benefit

(3,843)

5,942

Net income (loss)

$12,885

$(17,981)

Net loss attributable to non-controlling interest

(767)

(2,187)

Net income (loss) attributable to the Company

$13,652

$(15,794)

Weighted-average shares of Class A common stock outstanding – basic

88,607,655

76,602,759

Weighted-average shares of Class A common stock outstanding – diluted

113,015,159

76,602,759

Income (loss) per Class A share – basic

$0.15

($0.21)

Income (loss) per Class A share – diluted

$0.12

($0.21)

Consolidated Balance Sheets

(in $ thousands)

March 31, 2022
(Unaudited)

December 31,
2021

Assets

Cash and cash equivalents

$65,316

$50,049

Accounts receivable

34,312

33,236

Prepaid expenses and other

12,789

12,427

Total current assets

112,417

95,712

Property, plant and equipment, net

3,847

3,801

Restricted cash

15,514

26,291

Intangible assets, net

556,625

577,694

Goodwill

824,094

824,082

Operating lease right-of-use assets, net

11,473

10,500

Deferred tax assets

141,405

145,260

Other assets

2,500

2,500

Total noncurrent assets

1,555,458

1,590,128

Total assets

$1,667,875

$1,685,840

Liabilities

Accounts payable

$21,738

$20,083

Related party payable

14,324

17,394

Accrued expenses

19,553

26,819

Current operating lease liabilities

2,225

1,990

Current tax receivable agreement

24,454

24,496

Other current liabilities

1,049

1,566

Total current liabilities

83,343

92,348

Long-term debt

449,187

448,485

Noncurrent operating lease liabilities

9,886

9,091

Tax receivable agreement, net of current portion

196,755

221,333

Other liabilities

1,386

1,547

Total noncurrent liabilities

657,214

680,456

Total liabilities

$740,557

$772,804

Commitments and contingencies

Stockholders’ equity

Class A common stock, $0.0001 par value; 2,000,000,000 shares authorized, and 88,817,111 and 88,502,621 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively

9

9

Class V common stock, $0.0001 par value; 1,000 shares authorized and 100 shares issued and outstanding as of March 31, 2022 and December 31, 2021

Additional paid-in capital

1,101,432

1,100,012

Accumulated other comprehensive loss

(2)

(2)

Accumulated deficit

(212,362)

(226,016)

Total Repay stockholders’ equity

$889,077

$874,003

Non-controlling interests

38,241

39,033

Total equity

927,318

913,036

Total liabilities and equity

$1,667,875

$1,685,840

Key Operating and Non-GAAP Financial Data

Unless otherwise stated, all results compare first quarter 2022 results to first quarter 2021 results from continuing operations for the period ended March 31, respectively.

The following tables and related notes reconcile these non-GAAP measures to GAAP information for the three months ended March 31, 2022 and 2021:

Three months ended March 31,

(in $ thousands)

2022

2021

% Change

Card payment volume

$6,404,556

$4,614,003

39%

Gross profit1

50,999

35,045

46%

Adjusted EBITDA2

29,327

20,460

43%

(1)

Gross profit represents total revenue less other costs of services.

(2)

Adjusted EBITDA is a non-GAAP financial measure that represents net income adjusted for interest expense, depreciation and amortization and certain other charges deemed to not be part of normal operating expenses, non-cash charges and/or non-recurring items. See “Non-GAAP Financial Measures” above and the reconciliation of Adjusted EBITDA to its most comparable GAAP measure below.

Reconciliation of GAAP Net Income to Non-GAAP Adjusted EBITDA
For the Three Months Ended March 31, 2022 and 2021
(Unaudited)

Three Months ended March 31,

(in $ thousands)

2022

2021

Revenue

$67,564

$47,520

Operating expenses

Costs of services (exclusive of depreciation and amortization shown separately below)

$16,565

$12,475

Selling, general and administrative

32,218

23,393

Depreciation and amortization

28,589

17,793

Change in fair value of contingent consideration

(2,900)

2,649

Total operating expenses

$74,472

$56,310

Loss from operations

$(6,908)

$(8,790)

Interest expense

(989)

(1,183)

Loss on extinguishment of debt

(5,941)

Change in fair value of tax receivable liability

24,619

1,043

Other income

6

28

Other loss

(9,080)

Total other income (expense)

23,636

(15,133)

Income (loss) before income tax (expense) benefit

16,728

(23,923)

Income tax (expense) benefit

(3,843)

5,942

Net income (loss)

$12,885

$(17,981)

Add:

Interest expense

989

1,183

Depreciation and amortization (a)

28,589

17,793

Income tax expense (benefit)

3,843

(5,942)

EBITDA

$46,306

$(4,947)

Loss on extinguishment of debt (b)

5,941

Loss on termination of interest rate hedge (c)

9,080

Non-cash change in fair value of contingent consideration (d)

(2,900)

2,649

Non-cash change in fair value of assets and liabilities (e)

(24,619)

(1,043)

Share-based compensation expense (f)

3,357

5,151

Transaction expenses (g)

4,930

2,340

Employee recruiting costs (h)

200

136

Other taxes (i)

149

139

Restructuring and other strategic initiative costs (j)

1,246

628

Other non-recurring charges (k)

658

386

Adjusted EBITDA

$29,327

$20,460

Reconciliation of GAAP Net Income to Non-GAAP Adjusted Net Income
For the Three Months Ended March 31, 2022 and 2021
(Unaudited)

Three Months ended March 31,

(in $ thousands)

2022

2021

Revenue

$67,564

$47,520

Operating expenses

Costs of services (exclusive of depreciation and amortization shown separately below)

$16,565

$12,475

Selling, general and administrative

32,218

23,393

Depreciation and amortization

28,589

17,793

Change in fair value of contingent consideration

(2,900)

2,649

Total operating expenses

74,472

$56,310

Loss from operations

$(6,908)

$(8,790)

Interest expense

(989)

(1,183)

Loss on extinguishment of debt

(5,941)

Change in fair value of tax receivable liability

24,619

1,043

Other income

6

28

Other loss

(9,080)

Total other income (expense)

23,636

(15,133)

Income (loss) before income tax (expense) benefit

16,728

(23,923)

Income tax (expense) benefit

(3,843)

5,942

Net income (loss)

$12,885

$(17,981)

Add:

Amortization of Acquisition-Related Intangibles(l)

23,136

16,039

Loss on extinguishment of debt (b)

5,941

Loss on termination of interest rate hedge (c)

9,080

Non-cash change in fair value of contingent consideration (d)

(2,900)

2,649

Non-cash change in fair value of assets and liabilities (e)

(24,619)

(1,043)

Share-based compensation expense (f)

3,357

5,151

Transaction expenses (g)

4,930

2,340

Employee recruiting costs (h)

200

136

Restructuring and other strategic initiative costs (j)

1,246

628

Other non-recurring charges (k)

658

386

Non-cash interest expense (m)

703

536

Pro forma taxes at effective rate (n)

(1,194)

(8,722)

Adjusted Net Income

$18,402

$15,140

Shares of Class A common stock outstanding (on an as-converted basis) (o)

96,534,231

84,578,585

Adjusted Net income per share

$0.19

$0.18

(a)

See footnote (l) for details on our amortization and depreciation expenses.

(b)

Reflects write-offs of debt issuance costs relating to Hawk Parent’s term loans.

(c)

Reflects realized loss of our interest rate hedging arrangement which terminated in conjunction with the repayment of Term Loans.

(d)

Reflects the changes in management’s estimates of future cash consideration to be paid in connection with prior acquisitions from the amount estimated as of the most recent balance sheet date.

(e)

Reflects the changes in management’s estimates of the fair value of the liability relating to the Tax Receivable Agreement.

(f)

Represents compensation expense associated with equity compensation plans, totaling $3.4 million and $5.2 million for the three months ended March 31, 2022 and 2021, respectively.

(g)

Primarily consists of (i) during the three months ended March 31, 2022, professional service fees and other costs incurred in connection with the acquisitions of BillingTree, Kontrol Payables and Payix, and (ii) during the three months ended March 31, 2021, professional service fees and other costs incurred in connection with the acquisition of Ventanex, cPayPlus, and CPS, as well as professional service expenses related to the January 2021 equity and convertible notes offerings.

(h)

Represents payments made to third-party recruiters in connection with a significant expansion of our personnel, which we expect will become more moderate in subsequent periods.

(i)

Reflects franchise taxes and other non-income based taxes.

(j)

Reflects consulting fees related to our processing services and other operational improvements, including restructuring and integration activities related to our acquired businesses, that were not in the ordinary course during the three months ended March 31, 2022 and 2021.

(k)

For the three months ended March 31, 2022 and 2021, reflects extraordinary refunds to clients and other payments related to COVID-19 and non-cash rent expense.

(l)

For the three months ended March 31, 2022, reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the Business Combination, and client relationships, non-compete agreement, and software intangibles acquired through Repay’s acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus, CPS Payments, BillingTree, Kontrol Payables and Payix. For the three months ended March 31, 2021 reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the Business Combination, and client relationships, non-compete agreement, and software intangibles acquired through Repay’s acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus and CPS. This adjustment excludes the amortization of other intangible assets which were acquired in the regular course of business, such as capitalized internally developed software and purchased software. See additional information below for an analysis of our amortization expenses:

Three Months ended March 31,

(in $ thousands)

2022

2021

Acquisition-related intangibles

$23,136

$16,039

Software

4,946

1,465

Amortization

$28,082

$17,504

Depreciation

507

289

Total Depreciation and amortization1

$28,589

$17,793

1)

Adjusted Net Income is adjusted to exclude amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions (see corresponding adjustments in the reconciliation of net income to Adjusted Net Income presented above). Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although REPAY excludes amortization from acquisition-related intangibles from its non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Amortization of intangibles that relate to past acquisitions will recur in future periods until such intangibles have been fully amortized. Any future acquisitions may result in the amortization of additional intangibles.

 (m)

Represents non-cash deferred debt issuance costs.

 (n)

Represents pro forma income tax adjustment effect associated with items adjusted above.

(o)

Represents the weighted average number of shares of Class A common stock outstanding (on an as-converted basis assuming conversion of outstanding Post-Merger Repay Units) for the three months ended March 31, 2022 and 2021. These numbers do not include any shares issuable upon conversion of the Company’s convertible senior notes due 2026. See the reconciliation of basic weighted average shares outstanding to the non-GAAP Class A common stock outstanding on an as-converted basis for each respective period below:

Three Months ended March 31,

2022

2021

Weighted average shares of Class A common stock outstanding – basic

88,607,655

76,602,759

Add: Non-controlling interests
Weighted average Post-Merger Repay Units exchangeable for Class A common stock

7,926,576

7,975,826

Shares of Class A common stock outstanding (on an as-converted basis)

96,534,231

84,578,585

 

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
(404) 637-1665
khoyman@repay.com

Source: Repay Holdings Corporation

REPAY to Announce First Quarter 2022 Results on May 10, 2022

ATLANTA–(BUSINESS WIRE)–Apr. 28, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY” or the “Company”), a leading provider of vertically-integrated payment solutions, today announced that the Company will host a conference call to discuss first quarter 2022 financial results on Tuesday, May 10, 2022 at 5:30pm ET. Hosting the call will be John Morris, CEO, and Tim Murphy, CFO. A press release with first quarter 2022 financial results will be issued after the market closes that same day.

The conference call will be webcast live from the Company’s investor relations website at https://investors.repay.com/ under the “Events” section. The conference call can also be accessed live over the phone by dialing (877) 407-3982, or for international callers (201) 493-6780. A replay will be available two hours after the call and can be accessed by dialing (844) 512-2921 or (412) 317-6671 for international callers; the conference ID is 13729100. The replay will be available until Tuesday, May 17, 2022. An archive of the webcast will be available at the same location on the website shortly after the call has concluded.

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
(404) 637-1665
khoyman@repay.com

Source: Repay Holdings Corporation

REPAY Partners with D2R-Collect to Facilitate Payments and Maximize Collections

ATLANTA–(BUSINESS WIRE)–Apr. 20, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY”), a leading provider of vertically-integrated payment solutions, today announced a technology integration with D2R-Collect, a provider of cloud-based technology and recovery software solutions for accounts receivable, third party collections, credit unions, higher education institutions, and small- to medium-sized enterprises. The partnership will further improve and maximize collection efforts by offering enhanced digital payment acceptance capabilities for businesses utilizing the D2R-Collect platform.

D2R-Collect enables accounts receivable and collection teams to track, measure and optimize outreach efforts with easy-to-use tools, accelerating collections with timely, intelligent interactions and customized customer communication. The integration between the REPAY and D2R-Collect platforms will allow businesses to accept electronic payments, including credit and debit cards and ACH/EFT transactions, seamlessly and securely within the D2R-Collect software. As payments are made, REPAY automatically updates D2R-Collect with the latest payment information, streamlining collection workflows by eliminating manual data entry.

“D2R-Collect’s mission to provide an intelligent SaaS recovery solution is incredibly valuable in a number of industries like credit providers, alternative lenders, and higher education,” said Susan Perlmutter, Chief Revenue Officer of REPAY. “In order to increase recovery rates and maximize collections, it’s critical to offer convenient payment options that are easily accessible for when a consumer is ready and able to pay. Our partnership with D2R-Collect was a natural fit, with an aligned goal of creating a seamless experience that makes our customers’ lives easier.”

“We’re thrilled to be working with REPAY to expand our digital payment capabilities and empower consumers to make unassisted payments,” said Sam Andary, D2R-Collect Founder. “REPAY’s expertise in the electronic payments space and seamless integration will enhance the efforts and success of our client base of collections agencies, credit unions, and SMBs across the United States and Canada.”

About REPAY
REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

About D2R-Collect
D2R-Collect is a FinTech SaaS application that helps organizations recover their debts by accelerating the debt collection process which leads to higher recovery rates. D2R-Collect has been serving collection agencies, enterprises, and AR departments with a feature-rich, configurable, scalable collection platform that accelerates the collection process and keeps cash flow healthy. Developed alongside a team of collectors, D2R-Collect was specifically designed to focus on collecting more debt in less time, according to the needs and workflow of businesses. D2R-Collect can be used to collect from any device, on any operating system. To learn more, visit www.d2r-collect.com.

Investor Relations for REPAY:
repayIR@icrinc.com

Media Relations for REPAY:
Kristen Hoyman
khoyman@repay.com

Media Relations for D2R-Collect:
Sam Andary
Sam.Andary@D2Rcollect.com

Source: REPAY

REPAY and FLEX Announce Partnership to Deliver Payment Technology to Credit Unions and Enhance Member Experience

Latest ISV integration will provide credit unions on the FLEX platform with advanced integrated payment acceptance capabilities designed to improve the member experience

ATLANTA–(BUSINESS WIRE)–Mar. 31, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY”), a leading provider of vertically-integrated payment solutions, today announced a technology integration with FLEX, a leading provider of core system software for credit unions, continuing the company’s growing ISV partner portfolio. The partnership further expands credit unions’ abilities to offer digital payment options to members, enhancing the overall member experience and streamlining payment operations and reconciliation efforts for credit unions.

FLEX provides a comprehensive core processing solution that offers credit unions a member services platform with a robust feature set, including mobile banking and online lending capabilities with automated decisioning. REPAY’s payment technology will be integrated within the FLEX solution, enabling credit unions to seamlessly and securely accept electronic payments for loan repayments 24/7, through multiple member-facing payment channels.

“With deep experience partnering with ISVs to build payments into core offerings, we are thrilled to partner with FLEX to give credit unions the ability to support their members’ preferred payment methods without straining internal resources,” said Susan Perlmutter, Chief Revenue Officer of REPAY. “Offering credit union members convenient payment options where they can access technology to self-serve based on their unique needs – when and where they are ready – is critical to delivering a premier member experience.”

“FLEX is committed to providing credit unions with powerful technology to enable exceptional experiences throughout the entire member relationship, and REPAY was a natural fit with their expertise working with credit unions,” said Troy Hyde, Director of Software Service at FLEX. “Our solution is designed with built-in support and single point access to the extensive functionality required to manage all aspects of member services. We’re very excited to partner with REPAY to transform the loan repayment process into an easy and engaging experience for credit unions and their members.”

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

About FLEX

FLEX develops and delivers advanced core technology to credit unions, including built-in support and single point access to debit & credit cards, lending with auto decisioning & eSignatures, Internet banking, mobile banking, remote deposit, document management and overdraft privilege. With over 260 credit unions in 48 states including Alaska, Hawaii, and the Eastern Caribbean, FLEX enjoys established relationships with all regulatory agencies, corporate credit unions and major industry partners.

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
khoyman@repay.com

Media Relations Contact for FLEX:
Preston Packer
preston@flexcutech.com

Source: Repay Holdings Corporation

REPAY to Attend Upcoming Investor Conferences

ATLANTA–(BUSINESS WIRE)–Mar. 3, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY”), a leading provider of vertically-integrated payment solutions, today announced that the Company will participate in the following upcoming investor conferences:

  • On Wednesday, March 9, 2022, Tim Murphy, CFO and Jake Moore, EVP, Corporate Development and Strategy will participate in a fireside chat at the Morgan Stanley Technology, Media & Telecom Conference in San Francisco, CA. The discussion will begin at 9:45am PT.
  • On Thursday, March 10, 2022, Jake Moore, EVP, Corporate Development and Strategy will virtually participate in a B2B panel discussion at the Wolfe FinTech Forum. The discussion will begin at 2:20pm ET.

The discussions will be webcast live from the Company’s investor relations website at https://investors.repay.com/ under the “Events” section. An archive of the webcast will be available at the same location on the website for 90 days.

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
(404) 637-1665
khoyman@repay.com

Source: Repay Holdings Corporation

REPAY Reports Fourth Quarter and Full Year 2021 Financial Results

ATLANTA–(BUSINESS WIRE)–Mar. 1, 2022– Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY” or the “Company”), a leading provider of vertically-integrated payment solutions, today reported financial results for its fourth quarter and full year ended December 31, 2021.

“We reported a strong fourth quarter, capping off another successful year of growth for REPAY, both organically and through acquisitions. In 2021, we experienced card payment volume and gross profit growth of 35% and 44%, respectively, compared to 2020,” said John Morris, CEO of REPAY. “We are well positioned for another successful year of growth in 2022, and we will continue to position ourselves to take advantage of the many secular trends towards frictionless digital payments that have been, and we expect will continue to be, a tailwind driving our business.”

Three Months Ended December 31, 2021 Highlights

  • Card payment volume was $5.6 billion, an increase of 43% over the fourth quarter of 2020
  • Total revenue was $62.2 million, a 50% increase over the fourth quarter of 2020
  • Gross profit was $47.2 million, an increase of 57% over the fourth quarter of 2020
  • Net loss was ($17.4) million, as compared to a net loss of ($8.9) million in the fourth quarter of 2020
  • Adjusted EBITDA1, revised definition was $27.8 million, an increase of 58% over the fourth quarter of 2020
  • Adjusted Net Income1, revised definition was $27.0 million, an increase of 130% over the fourth quarter of 2020
  • Adjusted Net Income1 per share, revised definition was $0.28

Twelve Months Ended December 31, 2021 Highlights

  • Card payment volume was $20.5 billion, an increase of 35% over the full year 2020
  • Total revenue was $219.3 million, a 41% increase over the full year 2020
  • Gross profit was $163.8 million, an increase of 44% over the full year 2020
  • Net loss was $(56.0) million, as compared to net loss of $(117.4) million in the full year 2020
  • Adjusted EBITDA1, revised definition was $93.2 million, an increase of 57% over the full year 2020
  • Adjusted Net Income1, revised definition was $73.0 million, an increase of 100% over the full year 2020
  • Adjusted Net Income1 per share, revised definition was $0.80

Gross profit represents total revenue less cost of services. Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share are non-GAAP financial measures. See “Non-GAAP Financial Measures” and the reconciliations of Adjusted EBITDA and Adjusted Net Income to their most comparable GAAP measures provided below for additional information.

1 Beginning with the fourth quarter of 2021, the Company changed its definitions of its non-GAAP financial measures to simplify the presentation and enhance comparability between periods. A historical reconciliation of net income to both the revised and previous definitions of Adjusted EBITDA, Adjusted Net Income and Adjusted Net Income per share is set forth in the attachment to this release.

2022 Outlook

“We are pleased with our fourth quarter performance, reporting gross profit growth of 57%,” said Tim Murphy, CFO of REPAY. “In 2022, we will continue to invest in sales, product and technology to further accelerate our growth and position us well for the digital shifts our industry is experiencing across the verticals we serve. Our outlook assumes organic growth of approximately 20%, which we expect to gradually increase throughout 2022, with much stronger growth in the second half of the year.”

The change in methodology for REPAY’s Non-GAAP financial measures has no impact on the Company’s outlook for 2022 and any subsequent periods, as Adjusted EBITDA is presented below under the revised definition. REPAY expects the following financial results for full year 2022.

Full Year 2022 Outlook

Card Payment Volume

$27 – 28 billion

Total Revenue

$296 – 306 million

Gross Profit

$224 – 232 million

Adjusted EBITDA

$128 – 134 million

This range assumes no further unforeseen COVID-related impacts, which could create substantial economic duress in 2022. REPAY does not provide quantitative reconciliation of forward-looking, non-GAAP financial measures, such as forecasted 2022 Adjusted EBITDA, to the most directly comparable GAAP financial measure, because it is difficult to reliably predict or estimate the relevant components without unreasonable effort due to future uncertainties that may potentially have significant impact on such calculations, and providing them may imply a degree of precision that would be confusing or potentially misleading.

Conference Call

REPAY will host a conference call to discuss fourth quarter and full year 2021 financial results today, March 1, 2022, at 5:30 pm ET. Hosting the call will be John Morris, CEO, and Tim Murphy, CFO. The call will be webcast live from REPAY’s investor relations website at https://investors.repay.com/investor-relations. The conference call can also be accessed live over the phone by dialing (877) 407-3982, or for international callers (201) 493-6780. A replay will be available one hour after the call and can be accessed by dialing (844) 512-2921 or (412) 317-6671 for international callers; the conference ID is 13726126. The replay will be available at https://investors.repay.com/investor-relations.

Non-GAAP Financial Measures

This report includes certain non-GAAP financial measures that management uses to evaluate the Company’s operating business, measure performance, and make strategic decisions. Adjusted EBITDA is a non-GAAP financial measure that represents net income prior to interest expense, tax expense, depreciation and amortization, as adjusted to add back certain charges deemed to not be part of normal operating expenses, non-cash charges and/or non-recurring charges, such as loss on extinguishment of debt, loss on termination of interest rate hedge, non-cash change in fair value of warrant liabilities, non-cash change in fair value of contingent consideration, non-cash change in fair value of assets and liabilities, share-based compensation charges, transaction expenses, employee recruiting costs, other taxes, restructuring and other strategic initiative costs and other non-recurring charges. Adjusted Net Income is a non-GAAP financial measure that represents net income prior to amortization of acquisition-related intangibles, as adjusted to add back certain charges deemed to not be part of normal operating expenses, non-cash charges and/or non-recurring charges, such as loss on extinguishment of debt, loss on termination of interest rate hedge, non-cash change in fair value of warrant liabilities, non-cash change in fair value of contingent consideration, non-cash change in fair value of assets and liabilities, share-based compensation expense, transaction expenses, employee recruiting costs, restructuring and other strategic initiative costs, other non-recurring charges, non-cash interest expense and net of tax effect associated with these adjustments. Adjusted Net Income is adjusted to exclude amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions. Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although REPAY excludes amortization from acquisition-related intangibles from its non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Adjusted Net Income per share is a non-GAAP financial measure that represents Adjusted Net Income divided by the weighted average number of shares of Class A common stock outstanding (on an as-converted basis assuming conversion of the outstanding units exchangeable for shares of Class A common stock) for the three and twelve months ended December 31, 2021 and 2020 (excluding certain shares subject to forfeiture). REPAY believes that Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share provide useful information to investors and others in understanding and evaluating its operating results in the same manner as management. However, Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating profit, or any other operating performance measure calculated in accordance with GAAP. Using these non-GAAP financial measures to analyze REPAY’s business has material limitations because the calculations are based on the subjective determination of management regarding the nature and classification of events and circumstances that investors may find significant. In addition, although other companies in REPAY’s industry may report measures titled Adjusted EBITDA, Adjusted Net Income, Adjusted Net Income per share, or similar measures, such non-GAAP financial measures may be calculated differently from how REPAY calculates its non-GAAP financial measures, which reduces their overall usefulness as comparative measures. Because of these limitations, you should consider Adjusted EBITDA, Adjusted Net Income, and Adjusted Net Income per share alongside other financial performance measures, including net income and REPAY’s other financial results presented in accordance with GAAP.

Beginning with the quarter ended December 31, 2021, REPAY changed its method of calculating Adjusted EBITDA and Adjusted Net Income by removing the adjustment related to legacy commission restructuring charges and their tax effects. Adjusted EBITDA and Adjusted Net Income for the years and quarters ended December 31, 2020 and 2019 were also adjusted to conform to the current presentation, resulting in reductions in the Adjusted EBITDA and Adjusted Net Income from the previously reported amounts. The presentation for Adjusted EBITDA and Adjusted Net Income for all periods presented have been updated to reflect these changes and a reconciliation between the revised and previous definitions of Adjusted EBITDA and Adjusted Net Income have been provided within the “Reconciliations of GAAP Net Income to Non-GAAP Adjusted EBITDA” and “Reconciliations of GAAP Net Income to Non-GAAP Adjusted Net Income” tables below. The change in methodology for Non-GAAP financial measures has no impact on the Company’s outlook for 2022 and any subsequent periods.

Forward-Looking Statements

This communication contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about future financial and operating results, REPAY’s plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as “guidance,” “will likely result,” “are expected to,” “will continue,” “should,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. These forward-looking statements include, but are not limited to, REPAY’s 2022 outlook and other financial guidance, expected demand on REPAY’s product offering, including further implementation of electronic payment options and statements regarding REPAY’s market and growth opportunities, and REPAY’s business strategy and the plans and objectives of management for future operations. Such forward-looking statements are based upon the current beliefs and expectations of REPAY’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond REPAY’s control.

In addition to factors disclosed in REPAY’s reports filed with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2021, and those identified elsewhere in this communication, the following factors, among others, could cause actual results and the timing of events to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: exposure to economic conditions and political risk affecting the consumer loan market, the receivables management industry and consumer and commercial spending; the impacts of the ongoing COVID-19 coronavirus pandemic and the actions taken to control or mitigate its spread; a delay or failure to integrate and/or realize the benefits of the Company’s recent acquisitions; changes in the payment processing market in which REPAY competes, including with respect to its competitive landscape, technology evolution or regulatory changes; changes in the vertical markets that REPAY targets, including the regulatory environment applicable to REPAY’s clients; risks relating to REPAY’s relationships within the payment ecosystem; risk that REPAY may not be able to execute its growth strategies, including identifying and executing acquisitions; risks relating to data security; changes in accounting policies applicable to REPAY; and the risk that REPAY may not be able to maintain effective internal controls.

Actual results, performance or achievements may differ materially, and potentially adversely, from any projections and forward-looking statements and the assumptions on which those forward-looking statements are based. There can be no assurance that the data contained herein is reflective of future performance to any degree. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance. All information set forth herein speaks only as of the date hereof in the case of information about REPAY or the date of such information in the case of information from persons other than REPAY, and REPAY disclaims any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this communication. Forecasts and estimates regarding REPAY’s industry and end markets are based on sources it believes to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part. Pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

About REPAY

REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for clients, while enhancing the overall experience for consumers and businesses.

Consolidated Statement of Operations

($ in thousands)

Three Months
ended December
31, 2021

(Unaudited)

Three Months
ended December
31, 2020

(Unaudited)

Year ended
December 31,
2021

Year ended
December 31,
2020

Revenue

$

62,200

$

41,438

$

219,258

$

155,036

Operating expenses

Costs of services

$

15,000

11,457

$

55,484

41,447

Selling, general and administrative

33,421

21,537

120,053

87,302

Depreciation and amortization

26,312

16,776

89,692

60,807

Change in fair value of contingent consideration

5,947

500

5,846

(2,510

)

Impairment loss

2,180

2,180

Total operating expenses

$

82,860

$

50,270

$

273,255

$

187,046

Loss from operations

$

(20,660

)

$

(8,832

)

$

(53,997

)

$

(32,010

)

Interest expense

(916

)

(3,598

)

(3,679

)

(14,445

)

Loss on extinguishment of debt

(5,941

)

Change in fair value of warrant liabilities

(70,827

)

Change in fair value of tax receivable liability

(14,208

)

(384

)

(14,109

)

(12,439

)

Other income (expense)

15

(73

)

97

(3

)

Other loss

(9,099

)

Total other expense

(15,109

)

(4,055

)

(32,731

)

(97,714

)

Loss before income tax benefit

(35,769

)

(12,887

)

(86,728

)

(129,724

)

Income tax benefit

18,371

3,963

30,691

12,358

Net loss

$

(17,398

)

$

(8,924

)

$

(56,037

)

$

(117,366

)

Net loss attributable to non-controlling interests

(1,642

)

284

(5,952

)

(11,770

)

Net loss attributable to the Company

$

(15,756

)

$

(9,208

)

$

(50,085

)

$

(105,596

)

Weighted-average shares of Class A common stock outstanding – basic and diluted

88,431,186

71,166,120

83,318,189

52,180,911

Loss per Class A share – basic and diluted

($

0.18

)

($

0.13

)

($

0.60

)

($

2.02

)

Consolidated Balance Sheets

($ in thousands)

December 31,
2021

December 31,
2020

Assets

Cash and cash equivalents

$

50,049

$

91,130

Accounts receivable

33,236

21,311

Prepaid expenses and other

12,427

6,925

Total current assets

95,712

119,366

Property, plant and equipment, net

3,801

1,628

Restricted cash

26,291

15,375

Intangible assets, net

577,694

369,227

Goodwill

824,082

458,970

Operating lease right-of-use assets, net

10,500

10,075

Deferred tax assets

145,260

135,337

Other assets

2,500

Total noncurrent assets

1,590,128

990,612

Total assets

$

1,685,840

$

1,109,978

Liabilities

Accounts payable

$

20,083

11,880

Related party payable

17,394

15,812

Accrued expenses

26,819

19,216

Current maturities of long-term debt

6,761

Current operating lease liabilities

1,990

1,527

Current tax receivable agreement

24,496

10,240

Other current liabilities

1,566

Total current liabilities

92,348

65,436

Long-term debt, net of current maturities

448,485

249,953

Noncurrent operating lease liabilities

9,091

8,837

Tax receivable agreement, net of current portion

221,333

218,988

Other liabilities

1,547

10,583

Total noncurrent liabilities

680,456

488,361

Total liabilities

$

772,804

$

553,797

Commitments and contingencies

Stockholders’ equity

Class A common stock, $0.0001 par value; 2,000,000,000 shares authorized, and
88,502,621 and 71,244,682 issued and outstanding as of December 31, 2021 and
2020, respectively

9

7

Class V common stock, $0.0001 par value; 1,000 shares authorized and 100 shares
issued and outstanding as of December 31, 2020 and 2019

Additional paid-in capital

1,100,012

691,675

Accumulated other comprehensive loss

(2

)

(6,437

)

Accumulated deficit

(226,016

)

(175,932

)

Total Repay stockholders’ equity

874,003

509,313

Non-controlling interests

39,033

46,868

Total equity

$

913,036

$

556,181

Total liabilities and equity

$

1,685,840

$

1,109,978

Key Operating and Non-GAAP Financial Data

Unless otherwise stated, all results compare fourth quarter and year ended 2021 results to fourth quarter and year ended 2020 results from continuing operations for the periods ended December 31, respectively.

The following tables and related notes reconcile these non-GAAP measures to GAAP information for the three-month and years ended December 31, 2021 and 2020:

Three months ended
December 31,

Year ended December 31,

(in $ thousands)

2021

2020

% Change

2021

2020

% Change

Card payment volume

$

5,643,146

$

3,954,934

43

%

$

20,463,810

$

15,194,939

35

%

Gross profit1

47,200

29,981

57

%

163,774

113,589

44

%

Adjusted EBITDA2

27,846

17,604

58

%

93,200

59,551

57

%

(1)

Gross profit represents total revenue less other costs of services.

(2)

Adjusted EBITDA is a non-GAAP financial measure that represents net income adjusted for interest expense, depreciation and amortization and certain other charges deemed to not be part of normal operating expenses, non-cash charges and/or non-recurring items. See “Non-GAAP Financial Measures” above and the reconciliation of Adjusted EBITDA to its most comparable GAAP measure below.

Reconciliations of GAAP Net Income to Non-GAAP Adjusted EBITDA

For the Three Months Ended December 31, 2021 and 2020

(Unaudited)

($ in thousands)

Three Months Ended
December 31, 2021

Three Months Ended
December 31, 2020 (k)

Revenue

$

62,200

$

41,438

Operating expenses

Costs of services

$

15,000

$

11,457

Selling, general and administrative

33,421

21,537

Depreciation and amortization

26,312

16,776

Change in fair value of contingent consideration

5,947

500

Impairment loss

2,180

Total operating expenses

$

82,860

$

50,270

Loss from operations

$

(20,660

)

$

(8,832

)

Other (expense) income

Interest expense

(916

)

(3,598

)

Change in fair value of tax receivable liability

(14,208

)

(384

)

Other income (expense)

15

(73

)

Total other expense

(15,109

)

(4,055

)

Loss before income tax benefit

(35,769

)

(12,887

)

Income tax benefit

18,371

3,963

Net loss

$

(17,398

)

$

(8,924

)

Add:

Interest expense

916

3,598

Depreciation and amortization (a)

26,312

16,776

Income tax benefit

(18,371

)

(3,963

)

EBITDA

$

(8,541

)

$

7,487

Non-cash change in fair value of contingent consideration (b)

5,947

500

Non-cash change in fair value of assets and liabilities (c)

14,208

384

Share-based compensation expense (d)

6,082

4,679

Transaction expenses (e)

5,507

3,147

Employee recruiting costs (f)

182

92

Other taxes (g)

352

29

Restructuring and other strategic initiative costs (h)

1,643

524

Other non-recurring charges (i)

2,466

762

Adjusted EBITDA, revised definition

$

27,846

$

17,604

Revised definition no longer adjusts for:

Commission restructuring charges (j)

1,394

Adjusted EBITDA, previous definition

$

27,846

$

18,998

Reconciliations of GAAP Net Income to Non-GAAP Adjusted EBITDA

For the Years Ended December 31, 2021 and 2020

(Unaudited)

($ in thousands)

Year Ended December
31, 2021

Year Ended December
31, 2020 (k)

Revenue

$

219,258

$

155,036

Operating expenses

Costs of services

55,484

41,447

Selling, general and administrative

120,053

87,302

Depreciation and amortization

89,692

60,807

Change in fair value of contingent consideration

5,846

(2,510

)

Impairment loss

2,180

Total operating expenses

$

273,255

$

187,046

Loss from operations

$

(53,997

)

$

(32,010

)

Other (expense) income

Interest expense

(3,679

)

(14,445

)

Loss on extinguishment of debt

(5,941

)

Change in fair value of warrant liabilities

(70,827

)

Change in fair value of tax receivable liability

(14,109

)

(12,439

)

Other income (expense)

97

(3

)

Other loss

(9,099

)

Total other expense

(32,731

)

(97,714

)

Loss before income tax benefit

(86,728

)

(129,724

)

Income tax benefit

30,691

12,358

Net loss

$

(56,037

)

$

(117,366

)

Add:

Interest expense

3,679

14,445

Depreciation and amortization (a)

89,692

60,807

Income tax benefit

(30,691

)

(12,358

)

EBITDA

$

6,643

$

(54,472

)

Loss on extinguishment of debt (l)

5,941

Loss on termination of interest rate hedge (m)

9,080

Non-cash change in fair value of warrant liabilities (n)

70,827

Non-cash change in fair value of contingent consideration (b)

5,846

(2,510

)

Non-cash change in fair value of assets and liabilities (c)

14,109

12,439

Share-based compensation expense (d)

22,311

19,446

Transaction expenses (e)

19,250

10,924

Employee recruiting costs (f)

612

214

Other taxes (g)

977

426

Restructuring and other strategic initiative costs (h)

4,578

1,103

Other non-recurring charges (i)

3,853

1,154

Adjusted EBITDA, revised definition

$

93,200

$

59,551

Revised definition no longer adjusts for:

Commission restructuring charges (j)

2,527

8,614

Adjusted EBITDA, previous definition

$

95,727

$

68,165

Reconciliations of GAAP Net Income to Non-GAAP Adjusted Net Income

For the Three Months Ended December 31, 2021 and 2020

(Unaudited)

($ in thousands)

Three Months Ended
December 31, 2021

Three Months Ended
December 31, 2020 (k)

Revenue

$

62,200

$

41,438

Operating expenses

Costs of services

$

15,000

$

11,457

Selling, general and administrative

33,421

21,537

Depreciation and amortization

26,312

16,776

Change in fair value of contingent consideration

5,947

500

Impairment loss

2,180

Total operating expenses

$

82,860

$

50,270

Loss from operations

$

(20,660

)

$

(8,832

)

Other (expense) income

Interest expense

(916

)

(3,598

)

Change in fair value of tax receivable liability

(14,208

)

(384

)

Other income (expense)

15

(73

)

Total other expense

(15,109

)

(4,055

)

Loss before income tax benefit

(35,769

)

(12,887

)

Income tax benefit

18,371

3,963

Net loss

$

(17,398

)

$

(8,924

)

Add:

Amortization of acquisition-related intangibles (o)

23,174

14,188

Non-cash change in fair value of contingent consideration (b)

5,947

500

Non-cash change in fair value of assets and liabilities(c)

14,208

384

Share-based compensation expense (d)

6,082

4,679

Transaction expenses (e)

5,507

3,147

Employee recruiting costs (f)

182

92

Restructuring and other strategic initiative costs (h)

1,643

524

Other non-recurring charges (i)

2,466

762

Non-cash interest expense (p)

676

Pro forma taxes at effective rate (q)

(15,535

)

(3,655

)

Adjusted Net Income, revised definition

$

26,952

$

11,697

Shares of Class A common stock outstanding (on an as-converted basis) (r)

96,357,762

79,524,966

Adjusted Net Income per share, revised definition

$

0.28

$

0.15

Revised definition no longer adjusts for:

Commission restructuring charges (j)

1,394

Change in tax effect of adjustment (s)

(229

)

Adjusted Net Income, previous definition

$

26,952

$

12,862

Adjusted Net Income per share, previous definition

$

0.28

$

0.16

Reconciliations of GAAP Net Income to Non-GAAP Adjusted Net Income

For the Years Ended December 31, 2021 and 2020

(Unaudited)

($ in thousands)

Year Ended December
31, 2021

Year Ended December
31, 2020 (k)

Revenue

$

219,258

$

155,036

Operating expenses

Costs of services

55,484

41,447

Selling, general and administrative

120,053

87,302

Depreciation and amortization

89,692

60,807

Change in fair value of contingent consideration

5,846

(2,510

)

Impairment loss

2,180

Total operating expenses

$

273,255

$

187,046

Loss from operations

$

(53,997

)

$

(32,010

)

Other (expense) income

Interest expense

(3,679

)

(14,445

)

Loss on extinguishment of debt

(5,941

)

Change in fair value of warrant liabilities

(70,827

)

Change in fair value of tax receivable liability

(14,109

)

(12,439

)

Other income (expense)

97

(3

)

Other loss

(9,099

)

Total other expense

(32,731

)

(97,714

)

Loss before income tax benefit

(86,728

)

(129,724

)

Income tax benefit

30,691

12,358

Net loss

$

(56,037

)

$

(117,366

)

Add:

Amortization of acquisition-related intangibles (o)

79,932

52,126

Loss on extinguishment of debt (l)

5,941

Loss on extinguishment of interest rate hedge (m)

9,080

Non-cash change in fair value of warrant liabilities (n)

70,827

Non-cash change in fair value of contingent consideration (b)

5,846

(2,510

)

Non-cash change in fair value of assets and liabilities (c)

14,109

12,439

Share-based compensation expense (d)

22,311

19,446

Transaction expenses (e)

19,250

10,924

Employee recruiting costs (f)

612

214

Restructuring and other strategic initiative costs (h)

4,578

1,103

Other non-recurring charges(i)

3,853

1,154

Non-cash interest expense (p)

2,536

Pro forma taxes at effective rate (q)

(38,998

)

(11,813

)

Adjusted Net Income, revised definition

$

73,013

$

36,544

Shares of Class A common stock outstanding (on an as-converted basis) (r)

91,264,512

73,373,106

Adjusted Net Income per share, revised definition

$

0.80

$

0.50

Revised definition no longer adjusts for:

Commission restructuring charges (j)

2,527

8,614

Change in tax effect of adjustment (s)

(571

)

(1,413

)

Adjusted Net Income, previous definition

$

74,969

$

43,745

Adjusted Net Income per share, previous definition

$

0.82

$

0.60

Quarterly Reconciliations of GAAP Net Income to Non-GAAP Adjusted EBITDA

(Unaudited)

Predecessor

Successor

($ in thousands)

Three
Months
Ended
March
31, 2019

Three
Months
Ended
June 30,
2019

July 1,
2019
through
July 10,
2019

July 10,
2019
through
September
30, 2019

Three
Months
Ended
September
30, 2019
(Combined)

Three
Months
Ended
December
31, 2019

Three
Months
Ended
March
31, 2020

Three
Months
Ended
June 30,
2020

Three
Months
Ended
September
30, 2020

Three
Months
Ended
December
31, 2020

Three
Months
Ended
March
31, 2021

Three
Months
Ended
June 30,
2021

Three
Months
Ended
September
30, 2021

Three
Months
Ended
December
31, 2021

Net income (loss)

$

4,864

$

4,156

$

(32,763

)

$

(15,882

)

$

(48,645

)

$

(30,939

)

$

(13,182

)

$

(83,200

)

$

(12,060

)

$

(8,924

)

$

(17,981

)

$

(13,351

)

$

(7,308

)

$

(17,398

)

Add:

Interest expense

1,449

1,470

227

2,686

2,913

3,236

3,518

3,704

3,624

3,598

1,183

817

764

916

Depreciation and amortization (a)

2,914

2,975

333

10,703

11,036

4,895

13,904

14,706

15,421

16,776

17,793

19,679

25,907

26,312

Income tax benefit

(2,719

)

(2,719

)

(2,272

)

(1,116

)

(3,897

)

(3,383

)

(3,963

)

(5,942

)

(4,117

)

(2,261

)

(18,371

)

EBITDA

$

9,227

$

8,601

$

(32,203

)

$

(5,212

)

$

(37,415

)

$

(25,080

)

$

3,124

$

(68,687

)

$

3,602

$

7,487

$

(4,947

)

$

3,028

$

17,102

$

(8,541

)

Loss on extinguishment of debt (l)

1,316

64

5,941

Loss on termination of interest rate hedge (m)

9,080

Non-cash change in fair value of warrant liabilities (n)

15,258

6,898

66,670

(2,740

)

Non-cash change in fair value of contingent consideration (b)

740

(3,750

)

500

2,649

(1,200

)

(1,550

)

5,947

Non-cash change in fair value of assets and liabilities (c)

451

1,188

542

10,038

1,475

384

(1,043

)

4,355

(3,411

)

14,208

Share-based compensation expense (d)

127

124

10,409

12,262

3,523

5,475

5,768

4,679

5,151

5,505

5,573

6,082

Transaction expenses (e)

1,686

810

35,017

2,613

2,869

1,575

3,332

3,147

2,340

6,978

4,425

5,507

Management Fees(t)

100

100

11

Employee recruiting costs (f)

15

0

18

18

0

56

67

92

136

38

256

182

Other taxes (g)

59

168

32

(33

)

186

39

171

29

139

420

66

352

Restructuring and other strategic initiative costs (h)

124

93

80

56

78

112

389

524

628

945

1,362

1,643

Other non-recurring charges (i)

114

101

130

202

60

762

386

334

667

2,466

Adjusted EBITDA, revised definition

$

11,338

$

9,896

$

10,033

$

6,447

$

17,350

$

16,221

$

8,374

$

17,604

$

20,460

$

20,403

$

24,490

$

27,846

Revised definition no longer adjusts for:

Commission restructuring charges (j)

550

1,877

130

7,221

1,394

2,527

Adjusted EBITDA, previous definition

$

11,338

$

10,446

$

11,910

$

6,577

$

17,350

$

16,221

$

15,595

$

18,998

$

20,460

$

20,403

$

27,017

$

27,846

Quarterly Reconciliations of GAAP Net Income to Non-GAAP Adjusted Net Income

(Unaudited)

Predecessor

Successor

($ in thousands)

Three
Months
Ended
March
31, 2019

Three
Months
Ended
June 30,
2019

July 1,
2019
through
July 10,
2019

July 10,
2019
through
September
30, 2019

Three
Months
Ended
September
30, 2019
(Combined)

Three
Months
Ended
December
31, 2019

Three
Months
Ended
March 31,
2020

Three
Months
Ended
June 30,
2020

Three
Months
Ended
September
30, 2020

Three
Months
Ended
December
31, 2020

Three
Months
Ended
March 31,
2021

Three
Months
Ended
June 30,
2021

Three
Months
Ended
September
30, 2021

Three
Months
Ended
December
31, 2021

Net income (loss)

$

4,864

$

4,156

$

(32,763

)

$

(15,882

)

$

(48,645

)

$

(30,939

)

$

(13,182

)

$

(83,200

)

$

(12,060

)

$

(8,924

)

$

(17,981

)

$

(13,351

)

$

(7,308

)

$

(17,398

)

Add:

Amortization of acquisition-related intangibles (o)

1,980

1,980

9,778

11,591

13,203

13,841

14,240

14,188

16,039

17,270

23,449

23,174

Loss on extinguishment of debt (l)

1,316

64

5,941

Loss on extinguishment of interest rate hedge (m)

9,080

Non-cash change in fair value of warrant liabilities (n)

15,258

6,898

66,670

(2,740

)

Non-cash change in fair value of contingent consideration (b)

740

(3,750

)

500

2,649

(1,200

)

(1,550

)

5,947

Non-cash change in fair value of assets and liabilities(c)

451

1,188

542

10,038

1,475

384

(1,043

)

4,355

(3,411

)

14,208

Share-based compensation expense (d)

127

124

10,409

12,262

3,523

5,475

5,768

4,679

5,151

5,505

5,573

6,082

Transaction expenses (e)

1,686

810

35,017

2,613

2,869

1,575

3,332

3,147

2,340

6,978

4,425

5,507

Management Fees(t)

100

100

11

Employee recruiting costs (f)

15

18

18

56

67

92

136

38

256

182

Restructuring and other strategic initiative costs (h)

124

93

80

56

78

112

389

524

628

945

1,362

1,643

Other non-recurring charges (i)

114

101

130

202

60

762

386

334

667

2,466

Non-cash interest expense (p)

536

662

662

676

Pro forma taxes at effective rate (q)

(770

)

(832

)

(1,697

)

(4,427

)

(2,034

)

(3,655

)

(8,722

)

(7,693

)

(7,048

)

(15,535

)

Adjusted Net Income, revised definition

$

8,896

$

7,262

$

7,779

$

11,381

$

12,364

$

11,082

$

4,747

$

11,697

$

15,140

$

13,843

$

17,077

$

26,952

Shares of Class A common stock outstanding (on an as-converted basis) (r)

57,531,359

62,840,068

67,130,452

69,623,608

78,885,221

79,524,966

84,578,585

87,734,237

92,581,752

96,357,762

Adjusted Net Income per share, revised definition

$

0.14

$

0.18

$

0.18

$

0.16

$

0.06

$

0.15

$

0.18

$

0.16

$

0.18

$

0.28

Revised definition no longer adjusts for:

Commission restructuring charges (j)

550

1,877

130

7,221

1,394

2,527

Change in tax effect of adjustment (s)

(82

)

(6

)

(1,184

)

(229

)

(571

)

Adjusted Net Income, previous definition

$

8,896

$

7,812

$

9,574

$

11,505

$

12,364

$

11,082

$

10,784

$

12,862

$

15,140

$

13,843

$

19,033

$

26,952

Adjusted Net Income per share, previous definition

$

0.17

$

0.18

$

0.18

$

0.16

$

0.14

$

0.16

$

0.18

$

0.16

$

0.21

$

0.28

(a)

See footnote (o) for details on amortization and depreciation expenses.

(b)

Reflects the changes in management’s estimates of future cash consideration to be paid in connection with prior acquisitions from the amount estimated as of the most recent balance sheet date.

(c)

Reflects the changes in management’s estimates of the fair value of the liability relating to the Tax Receivable Agreement.

(d)

Represents compensation expense associated with equity compensation plans, totaling $6,081,869 and $22,311,251 in the three months and year ended December 31, 2021, respectively, and totaling $4,679,451 and $19,445,800 in the three months and year ended December 31, 2020, respectively.

(e)

Primarily consists of (i) during the three months and year ended December 31, 2021, professional service fees and other costs incurred in connection with the acquisitions of Ventanex, cPayPlus, CPS Payments, BillingTree, Kontrol Payables and Payix, as well as professional service expenses related to the January 2021 equity and convertible notes offerings, and (ii) during the three months and year ended December 31, 2020, professional service fees and other costs incurred in connection with the acquisition of CPS Payments, and additional transaction expenses incurred in connection with the business combination with Thunder Bridge Acquisition Ltd. in 2019 (the “Business Combination”) and the acquisitions of TriSource Solutions, APS Payments, Ventanex and cPayPlus, as well as professional service expenses related to the June 2020 and September 2020 equity offerings.

(f)

Represents payments made to third-party recruiters in connection with a significant expansion of Company personnel, which REPAY expects will become more moderate in subsequent periods.

(g)

Reflects franchise taxes and other non-income based taxes.

(h)

Reflects consulting fees related to processing services and other operational improvements, including restructuring and integration activities related to acquired businesses, that were not in the ordinary course during the three months and years ended December 31, 2021 and 2020.

(i)

For the three months and years ended December 31, 2021 and 2020, reflects extraordinary refunds to clients and other payments related to COVID-19. Additionally, for the three months ended December, 31, 2021, reflects trade names impairment, for the year ended December 31, 2021, reflects non-cash rent expense and loss on disposal of fixed assets, and for the year ended December 31, 2020, reflects expenses incurred related to one-time accounting system and compensation plan implementation related to becoming a public company.

(j)

Represents fully discretionary charges incurred to restructure certain sales representatives’ commission arrangements, by making a one-time payment to the representative to buy out the right to receive future monthly commission payments associated with a portfolio of client contracts. The commission restructuring transactions are subject to negotiation and therefore do not follow a fixed structure, timetable or standard terms. Neither the Company nor the representatives are obligated to offer or accept such restructuring of commission arrangements. Beginning the quarter ended December 31, 2021, REPAY changed its method of calculating Adjusted EBITDA and Adjusted Net Income by removing the adjustment related to legacy commission restructuring charges.

(k)

Does not include adjustments of $8.1 million and $32.6 million for the three months and year ended December 31, 2020, respectively, which were presented as pro forma adjustments in previously filed reports, for incremental depreciation and amortization recorded due to fair-value adjustments for Hawk Parent under ASC 805 as a result of Business Combination.

(l)

Reflects write-offs of debt issuance costs relating to Hawk Parent’s term loans.

(m)

Reflects realized loss of REPAY’s interest rate hedging arrangement which terminated in conjunction with the repayment of Term Loans.

(n)

Reflects the mark-to-market fair value adjustments of the warrant liabilities.

(o)

For the three months and year ended December 31, 2021, reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the Business Combination, and client relationships, non-compete agreement, and software intangibles acquired through Repay Holdings, LLC’s acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus, CPS Payments, BillingTree, Kontrol Payables and Payix. For the three months and year ended December 31, 2020 reflects amortization of client relationships, non-compete agreement, software, and channel relationship intangibles acquired through the Business Combination, and client relationships, non-compete agreement, and software intangibles acquired through Repay Holdings, LLC’s acquisitions of TriSource Solutions, APS Payments, Ventanex, cPayPlus and CPS. This adjustment excludes the amortization of other intangible assets which were acquired in the regular course of business, such as capitalized internally developed software and purchased software. See additional information below for an analysis of amortization expenses:

Three months ended
December 31,

Year ended December 31,

($ in thousands)

2021

2020

2021

2020

Acquisition-related intangibles

$

23,174

$

14,188

$

79,932

$

52,126

Software

2,714

2,291

8,464

7,467

Reseller buyouts

15

58

Amortization

$

25,888

$

16,494

$

88,396

$

59,651

Depreciation

424

282

1,296

1,156

Total Depreciation and amortization (1)

$

26,312

$

16,776

$

89,692

$

60,807

1)

Adjusted Net Income is adjusted to exclude amortization of all acquisition-related intangibles as such amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions (see corresponding adjustments in the reconciliation of net income to Adjusted Net Income presented above). Management believes that the adjustment of acquisition-related intangible amortization supplements GAAP financial measures because it allows for greater comparability of operating performance. Although REPAY excludes amortization from acquisition-related intangibles from its non-GAAP expenses, management believes that it is important for investors to understand that such intangibles were recorded as part of purchase accounting and contribute to revenue generation. Amortization of intangibles that relate to past acquisitions will recur in future periods until such intangibles have been fully amortized. Any future acquisitions may result in the amortization of additional intangibles.

(p)

Represents non-cash deferred debt issuance costs.

(q)

Represents pro forma income tax adjustment effect associated with items adjusted above and the tax effect adjustment of removing legacy commission restructuring charges. Beginning the quarter ended December 31, 2021, REPAY changed its method of calculating Adjusted EBITDA and Adjusted Net Income by removing the adjustment related to legacy commission restructuring charges and their tax effects.

(r)

Represents the weighted average number of shares of Class A common stock outstanding (on an as-converted basis) for the three months and years ended December 31, 2021 and 2020. These numbers do not include any shares issuable upon conversion of the Company’s convertible senior notes due 2026. See additional information below for an analysis of REPAY’s shares of Class A common stock outstanding:

Three Months Ended
December 31,

Year Ended December 31,

2021

2020

2021

2020

Weighted average shares of Class A common stock outstanding – basic

88,431,186

71,166,120

83,318,189

52,180,911

Add: Non-controlling interests

Weighted average Post-Merger Repay Units exchangeable for Class A common stock

7,926,576

8,358,846

7,946,323

21,192,195

Shares of Class A common stock outstanding (on an as-converted basis)

96,357,762

79,524,966

91,264,512

73,373,106

(s)

Represents tax effect adjustment of legacy commission restructuring charges. Beginning the quarter ended December 31, 2021, REPAY changed its method of calculating Adjusted EBITDA and Adjusted Net Income by removing the adjustment related to legacy commission restructuring charges and their tax effects.

(t)

Reflects management fees paid to Corsair Investments, L.P. pursuant to the management agreement, which terminated upon the completion of the Business Combination.

 

Investor Relations Contact for REPAY:
repayIR@icrinc.com

Media Relations Contact for REPAY:
Kristen Hoyman
(404) 637-1665
khoyman@repay.com

Source: Repay Holdings Corporation