Evertec reports $137M in 3Q20 revenue, up 15% Y-O-Y
Financial transactions processing firm Evertec reported total revenue for the quarter ended Sept. 30, 2020 of $136.5 million, an increase of 15% compared with $118.8 million in the prior year.
The company attributed the revenue increase in the quarter to sales volume growth and a “high average ticket” as businesses reopened in Puerto Rico following the COVID-19 restrictions implemented since mid-March.
The company also said increased revenue was driven by a $4.4 million contract in the business solutions segment with the Puerto Rico Department of Education for computers for public education teachers.
“In the third quarter, we delivered strong results as we benefited from businesses re-opening in Puerto Rico as well as the implementation of new client contracts,” said Evertec CEO Mac Schuessler.
“Additionally, we continued to grow our contactless payment solution in Puerto Rico and expanded our gateway product in Latin America to further accelerate the consumer preference for digital solutions,” he said, noting that the third quarter ended in September was “the highest quarterly performance in our company’s history.”
Adjusted EBITDA for the quarter was $70 million, representing an increase of 26% as compared to the prior year and adjusted earnings per share was $0.65 an increase of 38%.
“We generated significant operating cash flow year-to-date of $121 million and we returned approximately $18 million to our shareholders through share repurchases and dividends. Additionally, our liquidity as of Sept. 30 was $246 million,” Schuessler said during a earnings call with analysts.
Meanwhile, he said revenue related to digital transactions by business customers “surged in July to more than 30% growth, tapering off in the subsequent months for a total quarterly revenue growth of 16%.”
Evertec has expanded the contactless functionality — to pay for transactions at businesses — through QR codes from 400 merchants in July to more than 1,500 businesses at present, he said.
“However, consumer demand has been tempered by the expiration of the stimulus support. That said, we’re encouraged by the recently announced release of $13 billion in federal funds to rebuild the electric infrastructure on the island, which will be a longer term benefit to the economy,” Schuessler said.
“Additionally, we would expect to see a more immediate impact from the additional $300 per week of unemployment benefit, as outlined by the President’s executive order, which was approved by the Federal Emergency Management Agency for Puerto Rico only a few weeks ago and began to be distributed last week,” he added.