In Advance of the Scheduled Release of Financial Results on March 16, 2021, Unaudited 2020 Financial Results and 2021 Financial Guidance are Being Disclosed

ALPHARETTA, Ga., March 10, 2021 /PRNewswire/ -- Priority Technology Holdings, Inc. (NASDAQ: PRTH) ("Priority" or the "Company"), a leading provider of merchant acquiring, integrated payment software and commercial payment solutions, today announced that it is participating in the 33rd Annual Roth Conference on March 15, 2021.  Priority's Chairman and Chief Executive Officer Tom Priore and other company representatives will participate in one-on-one meetings with investors and analysts during the conference. To schedule a one-on-one meeting with Priority, please contact your Roth representative. A copy of the investor presentation will be available on our website on March 15, 2021. In these meetings, the Company may be discussing the following unaudited fourth quarter and full year 2020 financial results and financial guidance for 2021.

Fourth Quarter 2020 Unaudited Results
Financial highlights of the fourth quarter of 2020 compared with the fourth quarter of 2019, are as follows:

  • Revenue of $106.1 million increased 8.1% from $98.2 million.
  • Adjusted EBITDA (a non-GAAP measure1) of $18.2 million increased 12.7% from $16.2 million.

The fourth quarter of 2019 includes the results of the RentPayment business sold to MRI Software ("MRI") in September 2020.  The fourth quarter of 2020 results compared with the fourth quarter of 2019, excluding the RentPayment business, are as follows:

  • Revenue increased 12.3% from $94.5 million.
  • Adjusted EBITDA (a non-GAAP measure1) increased 35.2% from $13.6 million.

Full Year 2020 Unaudited Results
Financial highlights of the full year 2020 compared with the full year 2019, are as follows:

  • Revenue of $404.3 million increased 8.7% from $371.9 million.
  • Adjusted EBITDA (a non-GAAP measure1) of $70.3 million increased 19.4% from $58.9 million.

The consolidated results include the results of the RentPayment business from March 1, 2019 through September 22, 2020.  The results for full year 2020 compared with the results for full year 2019, excluding the RentPayment business, are as follows:

  • Revenue of $392.3 million increased 8.9% from $360.2 million.
  • Adjusted EBITDA (a non-GAAP measure1) of $62.1 million increased 25.0% from $49.7 million.

Full Year 2021 Financial Guidance
The Company expects the full year 2021 results, before any increases related to its anticipated acquisition of Finxera Holdings, Inc., to include:

  • Revenue in a range between $450 to $470 million, a growth of 15% to 20% above 2020 revenue of $392.3 million, excluding RentPayment.
  • Adjusted EBITDA (a non-GAAP measure1) in a range between $76 to $80 million, a growth of 22% to 29% above 2020 adjusted EBITDA of $62.1 million, excluding RentPayment.

(1) See "Non-GAAP Financial Measures" and the reconciliations of Adjusted EBITDA to their most comparable GAAP measures provided within the attached financial schedules.

Results With and Without RentPayment

Summary reconciliations of actual financial results for each quarter and full year 2020 (unaudited) and 2019 with actual results excluding the RentPayment business sold in September 2020 are included within the attached financial schedules.

Non-GAAP Financial Measures

This communication includes certain non-GAAP financial measures that we regularly review to evaluate our business and trends, measure our performance, prepare financial projections, allocate resources, and make strategic decisions. We believe these non-GAAP measures help to illustrate the underlying financial and business trends relating to our results of operations and comparability between current and prior periods. We also use these non-GAAP measures to establish and monitor operational goals. However, these non-GAAP measures are not superior to or a substitute for prominent measurements calculated in accordance with GAAP. Rather, the non-GAAP measures are meant to be a complement to understanding measures prepared in accordance with GAAP.

EBITDA, Adjusted EBITDA and Consolidated Adjusted EBITDA

EBITDA and adjusted EBITDA are performance measures. EBITDA is earnings before interest, income tax, and depreciation and amortization expenses ("EBITDA"). Adjusted EBITDA begins with EBITDA but further excludes certain non-cash costs, such as stock-based compensation and the write-off of the carrying value of investments or other assets, as well as debt extinguishment and modification expenses and other expenses and income items considered non-recurring, such as acquisition integration expenses, certain professional fees, and litigation settlements.  Consolidated adjusted EBITDA, which is a liquidity measure used in determining our total net leverage ratio, is adjusted EBITDA further adjusted for items specified in the definition of consolidated adjusted EBITDA within our debt agreements, which include the pro-forma impact of acquisitions and dispositions and other specified adjustments. We review the non-GAAP adjusted EBITDA measure to evaluate our business and trends, measure our performance, prepare financial projections, allocate resources, and make strategic decisions. We review the non-GAAP consolidated adjusted EBITDA to evaluate compliance with our total net leverage ratio at each measurement period.

The reconciliation of adjusted EBITDA to its most comparable GAAP measure is provided within the attached financial schedules.

Priority does not provide a reconciliation of forward-looking non-GAAP financial measures to their comparable GAAP financial measures because it could not do so without unreasonable effort due to the unavailability of the information needed to calculate reconciling items and due to the variability, complexity and limited visibility of the adjusting items that would be excluded from the non-GAAP financial measures in future periods. When planning, forecasting and analyzing future periods, the Company does so primarily on a non-GAAP basis without preparing a GAAP analysis as that would require estimates for various cash and non-cash reconciling items that would be difficult to predict with reasonable accuracy. For example, stock-based compensation expense would be difficult to estimate because it depends on the Company's future hiring and retention needs, as well as the future fair market value of the Company's common stock, all of which are difficult to predict and subject to constant change. As a result, the Company does not believe that a GAAP reconciliation would provide meaningful supplemental information about the Company's outlook.

Forward-Looking Statements

This press release 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, our plans, objectives, expectations and intentions with respect to future operations, products and services, and other statements identified by words such as "may," "will," "should," "anticipates," "believes," "expects," "plans," "future," "intends," "could," "estimate," "predict," "projects," "targeting," "potential" or "contingent," "guidance," "anticipates," "outlook" or words of similar meaning. These forward-looking statements include, but are not limited to, our 2021 outlook.  Such forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive risks, trends and uncertainties that could cause actual results to differ materially from those projected, expressed, or implied by such forward-looking statements.   These forward-looking statements may include, but are not limited to, statements about the effects of the COVID-19 pandemic on our revenues and financial operating results.  Our actual results could differ materially, and potentially adversely, from those discussed or implied herein.

We caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. You should evaluate all forward-looking statements made in this press release in the context of the risks and uncertainties disclosed in our Securities and Exchange Commission ("SEC") filings, including our Annual Report on Form 10-K and our Quarterly Report on Form 10-Q filed with the SEC on March 30, 2020 and November 13, 2020, respectively. These filings are available online at www.sec.gov or www.PRTH.com.

We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences we anticipate or affect us or our operations in the way we expect. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance. The forward-looking statements included in this press release are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements. We qualify all of our forward-looking statements by these cautionary statements.

PRIORITY TECHNOLOGY HOLDINGS, INC.

Non-GAAP Financial Measures

Unaudited 

                        
 

(in thousands)

 

(in thousands)

 

Twelve Months Ended December 31, 2020

 

Twelve Months Ended December 31, 2019

 

Consolidated

 

RentPayment

 

Excl RentPayment

 

Consolidated

 

RentPayment

 

Excl RentPayment

            

Revenues

$

404,342

  

$

12,042

  

$

392,300

  

$

371,854

  

$

11,694

  

$

360,160

 
            

Operating Expenses:

           

Costs of services

277,374

  

1,362

  

276,012

  

252,569

  

1,166

  

251,403

 

Salary and employee benefits

39,507

  

1,649

  

37,858

  

42,214

  

882

  

41,332

 

Depreciation and amortization

40,775

  

3,668

  

37,107

  

39,092

  

4,031

  

35,061

 

Selling, general and administrative

25,825

  

3,538

  

22,287

  

30,795

  

3,340

  

27,455

 

Total operating expenses

383,481

  

10,217

  

373,264

  

364,670

  

9,419

  

355,251

 
            

Income from operations

20,861

  

1,825

  

19,036

  

7,184

  

2,275

  

4,909

 
            

Depreciation and amortization

40,775

  

3,668

  

37,107

  

39,092

  

4,031

  

35,061

 

Other income, net

807

  

  

807

  

710

  

  

710

 

Net income attributable to NCIs

(250)

  

  

(250)

  

  

  

 

Non-cash stock-based compensation

2,430

  

  

2,430

  

3,652

  

  

3,652

 

Legal and professional fees

1,941

  

  

1,941

  

6,353

  

  

6,353

 

Legal settlements

(719)

  

100

  

(819)

  

(377)

  

  

(377)

 

Acquisition integration services

2,628

  

2,628

  

  

2,910

  

2,910

  

 

Intangible carrying value adjustment

1,753

  

  

1,753

  

  

  

 

Change in FV of contingent consideration

(360)

  

  

(360)

  

(620)

  

  

(620)

 

Write-down of note receivable

467

  

  

467

  

  

  

 
            

Adjusted EBITDA

$

70,333

  

$

8,221

  

$

62,112

  

$

58,904

  

$

9,216

  

$

49,688

 

 

PRIORITY TECHNOLOGY HOLDINGS, INC.

Non-GAAP Financial Measures

Unaudited 

    
    
 

(in thousands)

 

(in thousands)

 

Fourth Quarter 2020

 

Fourth Quarter 2019

 

Consolidated

 

RentPayment (1)

 

Excl RentPayment

 

Consolidated

 

RentPayment

 

Excl RentPayment

            

Revenues

$

106,091

  

$

(76)

  

$

106,167

  

$

98,183

  

$

3,636

  

$

94,547

 
            

Operating Expenses:

           

Costs of services

73,641

  

(7)

  

73,648

  

66,742

  

362

  

66,380

 

Salary and employee benefits

9,812

  

23

  

9,789

  

10,291

  

441

  

9,850

 

Depreciation and amortization

9,889

  

  

9,889

  

10,329

  

1,208

  

9,121

 

Selling, general and administrative

6,520

  

(113)

  

6,633

  

9,764

  

1,935

  

7,829

 

Total operating expenses

99,862

  

(97)

  

99,959

  

97,126

  

3,946

  

93,180

 
            

Income (loss) from operations

6,229

  

21

  

6,208

  

1,057

  

(310)

  

1,367

 
            

Depreciation and amortization

9,889

  

  

9,889

  

10,329

  

1,208

  

9,121

 

Other income, net

182

  

  

182

  

187

  

  

187

 

Net income attributable to NCIs

(50)

  

  

(50)

  

  

  

 

Non-cash stock-based compensation

803

  

  

803

  

298

  

  

298

 

Legal and professional fees

416

  

  

416

  

3,173

  

  

3,173

 

Legal settlements

3

  

  

3

  

34

  

  

34

 

Acquisition integration services

(119)

  

(119)

  

  

1,723

  

1,723

  

 

Intangible carrying value adjustment

773

  

  

773

  

  

  

 

Change in FV of contingent consideration

(360)

  

  

(360)

  

(620)

  

  

(620)

 

Write-down of note receivable

467

  

  

467

  

  

  

 
            

Adjusted EBITDA

$

18,233

  

$

(98)

  

$

18,331

  

$

16,181

  

$

2,621

  

$

13,560

 
  

(1)

RentPayment activity in the fourth quarter of 2020 relates to finalization of pre-sale operations.

 

 

PRIORITY TECHNOLOGY HOLDINGS, INC.

Non-GAAP Financial Measures

Unaudited 

                        
 

(in thousands)

 

(in thousands)

 

Third Quarter 2020

 

Third Quarter 2019

 

Consolidated

 

RentPayment

 

Excl RentPayment

 

Consolidated

 

RentPayment

 

Excl RentPayment

            

Revenues

$

108,962

  

$

3,883

  

$

105,079

  

$

93,883

  

$

3,652

  

$

90,231

 
            

Operating Expenses:

           

Costs of services

74,971

  

497

  

74,474

  

63,718

  

342

  

63,376

 

Salary and employee benefits

10,010

  

580

  

9,430

  

10,668

  

395

  

10,273

 

Depreciation and amortization

10,251

  

1,238

  

9,013

  

10,077

  

1,206

  

8,871

 

Selling, general and administrative

6,688

  

1,261

  

5,427

  

6,695

  

592

  

6,103

 

Total operating expenses

101,920

  

3,576

  

98,344

  

91,158

  

2,535

  

88,623

 
            

Income from operations

7,042

  

307

  

6,735

  

2,725

  

1,117

  

1,608

 
            

Depreciation and amortization

10,251

  

1,238

  

9,013

  

10,077

  

1,206

  

8,871

 

Other income, net

190

  

  

190

  

158

  

  

158

 

Net income attributable to NCIs

(200)

  

  

(200)

  

  

  

 

Non-cash stock-based compensation

601

  

  

601

  

1,171

  

  

1,171

 

Legal and professional fees

560

  

  

560

  

853

  

  

853

 

Legal settlements

(801)

  

  

(801)

  

(100)

  

  

(100)

 

Acquisition integration services

1,012

  

1,012

  

  

441

  

441

  

 

Intangible carrying value adjustment

980

  

  

980

  

  

  

 
            

Adjusted EBITDA

$

19,635

  

$

2,557

  

$

17,078

  

$

15,325

  

$

2,764

  

$

12,561

 

 

PRIORITY TECHNOLOGY HOLDINGS, INC.

Non-GAAP Financial Measures

Unaudited 

    
 

(in thousands)

 

(in thousands)

 

Second Quarter 2020

 

Second Quarter 2019

 

Consolidated

 

RentPayment

 

Excl RentPayment

 

Consolidated

 

RentPayment

 

Excl RentPayment

            

Revenues

$

92,356

  

$

4,391

  

$

87,965

  

$

92,142

  

$

3,336

  

$

88,806

 
            

Operating Expenses:

           

Costs of services

62,398

  

498

  

61,900

  

62,003

  

351

  

61,652

 

Salary and employee benefits

9,556

  

507

  

9,049

  

10,356

  

45

  

10,311

 

Depreciation and amortization

10,363

  

1,214

  

9,149

  

9,761

  

1,152

  

8,609

 

Selling, general and administrative

6,008

  

1,231

  

4,777

  

7,586

  

798

  

6,788

 

Total operating expenses

88,325

  

3,450

  

84,875

  

89,706

  

2,346

  

87,360

 
            

Income from operations

4,031

  

941

  

3,090

  

2,436

  

990

  

1,446

 
            

Depreciation and amortization

10,363

  

1,214

  

9,149

  

9,761

  

1,152

  

8,609

 

Other income, net

194

  

  

194

  

138

  

  

138

 

Non-cash stock-based compensation

688

  

  

688

  

1,023

  

  

1,023

 

Legal and professional fees

469

  

  

469

  

1,141

  

  

1,141

 

Legal settlements

77

  

100

  

(23)

  

(311)

  

  

(311)

 

Acquisition integration services

839

  

839

  

  

747

  

747

  

 
            

Adjusted EBITDA

$

16,661

  

$

3,094

  

$

13,567

  

$

14,935

  

$

2,889

  

$

12,046

 

 

PRIORITY TECHNOLOGY HOLDINGS, INC.

Non-GAAP Financial Measures

Unaudited 

    
 

(in thousands)

 

(in thousands)

 

First Quarter 2020

 

First Quarter 2019

 

Consolidated

 

RentPayment

 

Excl RentPayment

 

Consolidated

 

RentPayment

 

Excl RentPayment

            

Revenues

$

96,933

  

$

3,844

  

$

93,089

  

$

87,646

  

$

1,070

  

$

86,576

 
            

Operating Expenses:

           

Costs of services

66,364

  

374

  

65,990

  

60,106

  

111

  

59,995

 

Salary and employee benefits

10,129

  

539

  

9,590

  

10,899

  

1

  

10,898

 

Depreciation and amortization

10,272

  

1,216

  

9,056

  

8,925

  

465

  

8,460

 

Selling, general and administrative

6,609

  

1,159

  

5,450

  

6,750

  

15

  

6,735

 

Total operating expenses

93,374

  

3,288

  

90,086

  

86,680

  

592

  

86,088

 
            

Income from operations

3,559

  

556

  

3,003

  

966

  

478

  

488

 
            

Depreciation and amortization

10,272

  

1,216

  

9,056

  

8,925

  

465

  

8,460

 

Other income, net

241

  

  

241

  

227

  

  

227

 

Non-cash stock-based compensation

338

  

  

338

  

1,160

  

  

1,160

 

Legal and professional fees

496

  

  

496

  

1,185

  

  

1,185

 

Legal settlements

2

  

  

2

  

  

  

 

Acquisition integration services

896

  

896

  

  

  

  

 
            

Adjusted EBITDA

$

15,804

  

$

2,668

  

$

13,136

  

$

12,463

  

$

943

  

$

11,520

 

 

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SOURCE Priority Technology Holdings, Inc.