Record growth drives significant Adjusted EBITDA expansion to
$1.3 million and highest ever
Operating Cash Flow generation of $3.9
million in the third quarter
TORONTO, Nov. 9, 2022
/PRNewswire/ - Payfare Inc. ("Payfare" or the
"Company") (TSX: PAY), a leading fintech powering
instant payout and digital banking solutions for the gig workforce,
today announced the filing of its Financial Statements and
Management's Discussion and Analysis ("MD&A") for the
quarter ending September 30, 2022. A
comprehensive discussion of Payfare's financial position and
results of operations are provided in the MD&A, which is filed
on SEDAR under Payfare's profile and can be found at
www.sedar.com.
Q3 2022 Financial Highlights:
- Revenue of $35.9 million in Q3
2022, representing a $23.2 million
(+183%) increase over Q3 2021 and a $2.3
million (+7%) increase over Q2 2022.
- Gross profit of $6.9 million in
Q3 2022, up $4.9 million (+246%)
compared to Q3 2021 and up $0.5
million (+8%) compared to Q2 2022.
- Net loss improved to ($0.8
million) in Q3 2022 compared to a net loss of ($4.0 million) in Q3 2021 and a net loss of
($2.3 million) in Q2 2022.
- Record Adjusted EBITDA1 expansion to $1.3 million in Q3 2022, a $3.5 million (+161%) increase over Q3 2021 and a
$1.0 million (+357%) increase over Q2
2022.
- Record Operating Cash Flow generation of $3.9 million in Q3 2022, up $4.9 million over Q3 2021 and up $7.3 million over Q2 2022.
- Total gross dollar value (Total GDV)1 in Q3 2022 was
$2.1 billion, an increase of
$1.4 billion (+176%) over Q3 2021 and
$0.2 billion (+9%) over Q2
2022.
- Ended Q3 2022 with 920,682 active users1, an
increase of 560,395 (+156%) compared to active users as at
September 30, 2021.
- Payfare believes the market price of Common Shares may not,
from time to time, fully reflect their value and that repurchasing
shares under the Normal Course Issuer Bid (NCIB) program can be an
attractive use of capital. The Company has repurchased 765,100
Common Shares to date at an average cost of $4.62 per share.
Executing on strategic objectives:
- DasherDirect App by Payfare was ranked # 1 in August 2022 amongst all US Finance Apps by UnitQ,
a product quality monitoring platform which conducts rankings based
on user feedback data from app store reviews and social media.
- Launched new, enhanced cash back rewards on gas purchases for
U.S. Lyft drivers using a Lyft Direct debit card, powered by
Payfare. As of September 28, 2022
Lyft drivers can earn up to 8% cash back on every gas purchase in
accordance with their driver tier.
"We are excited to announce record growth in both Adjusted
EBITDA and Operating Cash Flow in the third quarter," said
Marco Margiotta, CEO and Founding
Partner of Payfare. "Fourth quarter user growth in both rideshare
and delivery is tracking ahead of third quarter levels. We remain
focused on growth and are able to deploy capital opportunistically
including funding the launch of new products and other strategic
growth opportunities".
Conference Call
Management will host a conference call on Thursday, November 10, 2022, at 8:30 a.m. ET to discuss these results. A short
presentation in connection with the conference call will be made
available on the Company's website at
https://corp.payfare.com/investors/. Management will also host a
live question and answer session on the conference call with
analysts.
To access the conference call, please dial (416) 764-8658 or
1-888-886-7786. Please call the conference telephone number 10-15
minutes prior to the start time so that you are in the queue for an
operator to assist in registering and patching you through.
An archived recording of the conference call will be available
until December 10, 2022. To listen to
the recording, call (416) 764-8692 or 1-877-674-7070 and enter
passcode 019715.
About Payfare (TSX:PAY)
Payfare is a global
financial technology company powering digital banking and instant
payment solutions for today's gig workforce. Payfare partners with
leading platforms and marketplaces, such as Uber, Lyft and
DoorDash, to provide financial health for their workforce.
1Non-IFRS and Supplementary Financial
Measures
This press release contains references to "active users", "Total
GDV" and "Adjusted EBITDA" which are not measures prescribed by
International Financial Reporting Standards (IFRS). These
supplementary financial measures are provided as additional
information to complement IFRS measures by providing a further
understanding of our results of operations from management's
perspective, to provide investors and security analysts with
supplemental measures to evaluate the financial performance of the
Company and highlight trends in our core business that may not
otherwise be apparent when relying solely on IFRS financial
measures. Management also uses non-IFRS and supplementary financial
measures to facilitate operating performance comparisons from
period to period, prepare annual operating budgets and strategic
business plans and to evaluate and price potential acquisitions.
Accordingly, non-IFRS and supplementary financial measures should
not be considered in isolation or as a substitute for analysis of
our financial information reported under IFRS. Such measures do not
have any standardized meaning prescribed by IFRS and, therefore,
may not be comparable to similar measures presented by other
corporations. The non-IFRS and supplementary financial measures are
not subject to standard industry definition and our definitions and
method of calculation may differ from other issuers and therefore
may not be comparable to similar measures presented by other
issuers.
The Company determines the number of users to its services based
on active users. "Active users" represent users who have loaded
earnings on their card in the period. "Total GDV" is defined as the
aggregate dollar amount of active user earnings and direct deposits
loaded on their payment card during the period.
"EBITDA" means net income (loss) before amortization and
depreciation expenses, foreign exchange loss (gain), amortization
of deferred income, finance and interest costs (income) and
provision for income taxes.
"Adjusted EBITDA" adjusts EBITDA for stock-based compensation
expense, transactional gains or losses on assets, asset impairment
charges, loss on extinguishment of debts, interest income, net
foreign exchange gains or losses, gains or losses from changes in
fair value of derivative financial instruments and contingent
consideration liabilities measured at fair value through profit or
loss, gains or losses from disposals of equipment, net income or
loss from equity accounted investees and income tax expense or
recovery, restructuring costs and non-recurring expense items.
Non-recurring expense items are transactions or events which
management believes will not re-occur within the foreseeable future
and includes legal and professional fees related to acquisition and
going public transaction. The table below reconciles net loss to
EBITDA and Adjusted EBITDA for the three and nine months ended
September 30, 2022 and 2021.
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
In CAD
$
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Net loss
|
$(823,855)
|
|
$(3,995,030)
|
|
$(5,839,217)
|
|
$(16,787,443)
|
Add:
|
|
|
|
|
|
|
|
Finance (income)
costs
|
(303,597)
|
|
(86,721)
|
|
(492,684)
|
|
2,691,403
|
Other
Income
|
(23,153)
|
|
(39,377)
|
|
(96,061)
|
|
(118,979)
|
Foreign exchange
(gain) loss
|
(63,136)
|
|
13,698
|
|
(34,712)
|
|
17,757
|
Amortization of
intangible assets
|
354,976
|
|
171,032
|
|
753,295
|
|
704,696
|
Depreciation of
building, property & equipment
|
36,587
|
|
10,187
|
|
106,557
|
|
39,944
|
EBITDA
|
(822,178)
|
|
(3,926,211)
|
|
(5,602,822)
|
|
(13,452,622)
|
Adjustments:
|
|
|
|
|
|
|
|
IPO costs (legal,
professional, other)
|
-
|
|
-
|
|
-
|
|
472,722
|
Settlement of legal
claim
|
-
|
|
-
|
|
-
|
|
1,400,000
|
Restructuring
expense
|
142,274
|
|
50,000
|
|
142,274
|
|
50,000
|
Share based
compensation
|
2,011,292
|
|
1,682,104
|
|
6,224,194
|
|
3,912,933
|
Adjusted
EBITDA
|
$1,331,388
|
|
$(2,194,107)
|
|
$763,646
|
|
$(7,616,967)
|
Additional information on these measure may be found under the
heading "Definitions – IFRS, Additional GAAP and Non-GAAP Measures"
in the MD&A for the three and nine months ended September 30, 2022 and 2021 which is available
under Payfare's profile on SEDAR at www.sedar.com and is
incorporated by reference to this press release.
Forward-Looking Information
This press release contains forward-looking information within
the meaning of applicable securities legislation, which reflects
Payfare's current expectations regarding future events as of the
date hereof. Such forward-looking information may include but are
not limited to statements regarding fourth quarter user growth in
both rideshare and delivery is tracking ahead of third quarter
levels, the ability to deploy capital opportunistically, funding
the launch of new products and other strategic growth
opportunities. Forward-looking information is based on a number of
assumptions and is subject to a number of risks and uncertainties,
many of which are beyond Payfare's control, that could cause actual
results and events to differ materially from those that are
disclosed in or implied by such forward-looking information. Such
risks include the factors discussed under the "Risk Factors"
section in Payfare's MD&A for the year ended December 31, 2021. Other factors that could cause
actual results or events to differ materially include the inability
of Payfare to launch and market its new programs or platforms that
are planned in a timely manner, the lack of appropriate
opportunities to deploy capital, Payfare's inability to manage the
increased volume of new cardholder sign-ups, active users or
transactions, the impact of inflation and rising costs of goods and
services on Payfare's business model which may impact management's
expectations on active user growth in the fourth quarter of 2022,
the imposition of new restrictions related to the COVID-19
pandemic, Payfare's ability to finance and support new programs and
platforms, and a general decline in the credit markets or gig
economy in North America.
Accordingly, readers should not place undue reliance on
forward-looking information. Payfare does not undertake any
obligation to update such forward-looking information, whether as a
result of new information, future events or otherwise, except as
expressly required by applicable law.
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SOURCE Payfare