Evertec reports $103.5M in 2Q17 revenue, up 6% YOY
Evertec Inc. announced Tuesday results for the second quarter ended June 30, 2017, which put total revenue for the quarter at $103.5 million, an increase of 6 percent compared with $97.7 million in the prior year.
Evertec stated that Merchant Acquiring net revenue was $23.5 million, reflecting an increase of 1 percent compared with $23.3 million in the prior year. Revenue growth in the quarter was driven by volume growth and fees partially offset by the shift of revenue from the Merchant Acquiring segment to the Payment Processing segment, reflecting two months of a second quarter 2016 client contract change.
“We’re pleased with our execution and performance in the quarter. Additionally, with the closing of the acquisition of PayGroup, we significantly advanced our Latin American growth strategy,” said Evertec CEO Mac Schuessler.
On July 3, 2017, Evertec Group, LLC and Evertec Panama S.A. completed the acquisition of EFT Group S.A., a Chilean-based company known commercially as PayGroup for approximately $46 million, which comprises a cash payment of about $38.5 million and the assumption of some $7.5 million in debt and other liabilities. PayGroup is a payment processing and software company serving primarily financial institutions throughout Latin America.
Payment processing revenue was $30.7 million, an increase of 9 percent compared with $28.2 million in the prior year.
Revenue results in the quarter reflected the previously referenced client contract change from Merchant Acquiring to Payment Processing and increases in ATH debit network transaction volumes, card processing volumes, POS rental income, as well as increased revenue related to government programs, the San Juan-based company said.
Business solutions revenue was $49.3 million, an increase of 7 percent compared with $46.2 million in the prior year. The growth reflected increased revenue related to the acquisition of Accuprint and increased core banking revenue.
For the quarter ended June 30, 2017, adjusted EBITDA was $50.1 million, an increase of 3 percent compared to the prior year. Adjusted EBITDA margin (Adjusted EBITDA as a percentage of total revenues) decreased 160 basis points to 48.4 percent compared with 50.0 percent in the prior year, Evertec reported.
The decrease in Adjusted EBITDA margin was driven by increased compliance and information security expenses as well as increases in withholding taxes, severance and other operating expenses partially offset by favorable revenue mix on increased volumes and the impact of foreign currency gains, the company stated.
For the quarter ended June 30, 2017, GAAP Net Income attributable to common shareholders was $20.1 million, or $0.27 per diluted share, compared with $20.2 million or $0.27 per diluted share in the prior year.
Adjusted net income was $32.2 million, an increase of 1 percent compared with $32 million in the prior year and included the impact of increased depreciation and amortization expense and increased interest expense in the current year. Adjusted earnings per common share were $0.44, an increase of 2 percent as compared to $0.43 in the prior year.
During the three months ended June 30, 2017, the company repurchased approximately 0.24 million shares of common stock at an average price of $16.47 per share for a total of $3.9 million. As of June 30, 2017, a total of approximately $72 million remained available for future use under the company’s share repurchase program, Evertec reported.