PaySign (PAYS) 10 May 202020 Q1 Earnings call transcript

Good day, everyone. And welcome to today’s PaySign 2020 First Quarter Earnings Call. At this time, all participants are in a listen-only mode. Later you will have an opportunity to ask questions during the question-and-answer session. [Operator Instructions]

forward-looking include may presentation statements. This the that To events, margins, presentation business markets presented returns such operations, this or otherwise about are information financial the plans, equity, projections, future gross of company’s statements extent discusses the information in about forward-looking. COVID-XX, statements the or expected of impact make results on expectations

and believes, Such as should, such use of estimates, forecasts, forward-looking projects, words statements can be identified proposes. expects, plans, intends, by anticipates, the may,

expectations and reflected such on results the these could Although, forward-looking are based the that materially forward-looking company actual are in reasonable a statements believes from cause differ to number uncertainties there statements. assumptions, of risks that

under our You review statements consider are other cautionary XXXX to Factors any and carefully and elsewhere heading Form the Risk statements XX-K. in disclosures, urged made and including the

only in document required does update speak may except of statements the which undertake as they as any any of date company contained duty law. to and statements, not the the Forward-looking forward-looking by are be

This financial prepared measure Accounting measures U.S. GAAP. presentation Accepted in an nor accordance that a to, prepared alternative Generally non-GAAP EBITDA, accordance with, not with in Principles, is the includes adjusted also financial

is by presented necessarily EBITDA on adjusted addition, being Please is is recorded. other methodology comparable prescribed note based In companies. standardized GAAP to any by similarly not measures not and titled this call

turn to CEO, to over my Mark go program now today’s ahead. Please is pleasure It Newcomer.

Officer. PaySign. am for Newcomer, With thank at is everyone. XXXX afternoon, you Thank for Executive I And Good first Chief Attinger, us our afternoon Chief this Officer President about Mark you, quarter Financial Mark a Pricilla. joining financial me results. and here discussion our

hope COVID-XX you the regards to all your are time. during this commentary business Before families I pandemic, my safe on staying of begin unprecedented and with we

to customers ensure to hard our best cardholders. level the team the of PaySign health work and and to service both continue We our welfare provide and continue highest the to of

has and performance all here the our results with toward PaySign pleased and contributions very extremely to company’s exceptional at which everyone on proud remain I contributed growth, strong of continued fronts. our

quarter, XX% million, XX% revenues year, of was first an was compared of million, $X.X our increase prior an EBITDA the $X.X adjusted our increase net a For increase and an income record to of million, were the XX%. $XX.X

the we Patient to to two pharma and and business affordability several quarter, In first programs added pharmaceutical the programs added Affordability the patient line pipeline.

remains robust all segments. pipeline Our in

In well solutions, use, Card the PaySign first we use Premier corporate which of digital received. banking for being is quarter, which began the offering include all

now now cardholders product Our platform. blood pipeline excess has our of centers. blood and includes collection and We million expanded plasma have in on X.X

see effect did QX of COVID-XX pandemic. related We during an not the to much

which Although, effect, we beginning address will are some Mark to remarks. his during see

convalescent in patients to in with many That as being started COVID-XX possible recovered centers centers large said, These donors therapies. recruit populations. for use generally plasma located areas affected collection COVID-XX have plasma are

pandemic, a we pharmaceutical standard the future the time, solutions see and confident At very the of future and growth this profit our I than of Not of for pandemic. continue programs and These centers donors recruiting to higher donors growth affordability company. patient current apparent remain traditional the year-over-year the from in no in -- effect with profitability are this XXX level affected being donors. are at compensated plasma our about significantly purpose. excellent by

centralized products. services our as billing as requested services, service had space, we long-standing I by with payment our expanded and in to our which claims include include business and Patient opening beyond and payment offerings new this pharmacy-based opportunities hub Affordability other well line previously, have As processing clients, shared co-pay, pharmaceutical established medical payments,

These steps PaySign our as our quarter, build the clients, out brand. products, and the business instrumental industry this well for creating been to team expand continued In have refreshing have line veterans. in as first functionality -- we contributed features with we new have and proven

opportunity the website website prospects and visit and live and had our more composition access and clients, to haven’t effectively our investors providing you our went relevant to a recently, past visit If strategy with please much-improved products Monday, www.paysign.com. we offerings. information of This conveying the

continue Looking ahead, we focus. and market will to diversify broaden our

of will remain We out and will offerings. we create the services on continue continue to extremely enhance long-term to to focus new enthusiastic Affordability maximizing value-added continue shareholder build business-to-business about to We Patient develop and solutions our new the and growth value. company

take through At Mark Attinger, this more us it in detail. financials CFO, time, let Mark? me over to the who our turn will

Thank you, Mark.

quarter will take April. and I touch So commentary variance results, us on first some through provide the briefly

distribution mention while it I been to by Wire, that by through to the, in in results but I Business begin, Investor investors the did excuse to slowed volumes. released been Relations due all appears have the registered has our submitted NASDAQ, me, NASDAQ issuance want our to to be team Before

that shortly. come see should you out So

As I refers changes percentage or otherwise as to one to quarter XXXX, XXXX, quarter stated year-on-year unless proceed, to comparisons compared XXXX. references one improvements, to

industry, in the $X.X or March XX% to XX% $X.X and pharma, XX% year the support year-on-year of million was $X,XXX,XXX. prior $X.X other XXX% quarter million a XXXX, ending compared X% of for or in XX, Revenue revenue. consisted or improvement XX%, Revenue increase improvement, $XX,XXX,XXX, the million of of an plasma

XXX-basis-point million or XX% XX.X% primarily driven favorable and $X.X increased a toward revenues mix programs. The XX.X% higher-margin XXXX. by of profit of Gross to revenues, improvement compared million was in to $X.X

of in as Total an $X.X $X.X outside in increase in professional and operating depreciation and million, in services, benefits, consisted and $X.X million compensation. million versus increase stock-based million of $X.X expenses million $X.X XXXX. amortization in an were salaries million primarily increase XX.X% The $X.X

$XXX,XXX of the the income. was prior intra-quarter, occurring impact year, funds rate just Reflecting the the in reduction to income fed $XX,XXX, compared our interest

year. $X.XX Fully was share, prior an for compared the diluted $XXX,XXX income also $X,XXX,XXX per increase or was basic compared year of to basic EPS $X.XX, Net share the per to $X.XX. $X.XX or XX.X%,

to an points or $X,XXX,XXX share, to prior XXX basic margin adjusted XX.X%, up $X,XXX,XXX XX.X% the EBITDA year. increase the per from prior $X.XX the compared XX.X%, Furthermore, $X.XX of basis adjusted improved year. or basic share per EBITDA Non-GAAP was

We XX%. versus the up loaded card million to $XXX million $XXX prior the year,

conversion XXX revenue X.XX% of bps, gross compared the to prior on year. bps or was XXX volume rate or loaded cards dollar X.XX% Our

Recognizing the the unique timing seasonally of loads, dollar and first rate. lowest is conversion revenue quarter spend revenue recognition, our

key For example, X.XX%. rate XXXX, in revenue our quarter for to increased was April preliminary X.XX%. reviewing two conversion XXXX, conversion rate revenue Similarly, the indicators

perspective, one million, $XX.X XXXX at $X.X million, end and compared to year compared to a increased ending has cash, cash XX% $X.X or Working end including XXXX. $XX.X capital increased to at to quarter year $XX.X ending quarter balance one From compared $XX.X million sheet restricted to million consolidated million million XXXX XXXX.

an measured adjusted year end. restricted current ratio, reflected as liquidity, and versus funding cash liability, excluding card X.X times Our by at times X.X coverage

to on different further We pick unrestricted baseline prior and up on currently, versus scenarios $X.X plan. PPPL But a million call. touch like bit modeled in from cash question little the the three our cash. I’d we have

to to expect cash under on basis We already adding cash generate position. a an year all current strong full scenarios

nor project immediately we business we Protection After completing determined received the had Xst. on do applied modeling, that Paycheck and a need, we our we need. do Program May loan have However, for not funds a

and submitted the receipt our therefore to the bank return have of We the request a loan. funds, application nullifying

the just approximately not our preliminary appears revenue versus business April, completed although for month closing is books we The to the have yet, respect April plasma existing XX% performing as With XXXX. expected. pharma for down

of guidance understanding allow the implications As forward, issuing for a COVID-XX. we from better revenue look refrain to we continue to of

to we from and benefit and grow Patient expect to similar continued XXXX. additional division we growth revenue As the of business, gross margins Affordability lines

I question-and-answer concludes session. moderator Pricilla, turn will Thank I begin our that back my time. over you. this think to to remarks at our it

to [Operator from first we Davidson. Instructions] Peter And will go Heckmann

line Your open. is

two taking or over Hey. a bit and had afternoon, and if could fairly some I have question. dig everyone. areas if more more pharma. could when in little opportunities early new Good quickly programs you bit over [inaudible]? in you might detail of Thanks Affordability Patient in the well, as within some those The those you today intra-quarter those you little within for was hoping and that start, success my you campaigns then, go went added a

Yes.

touch the we pharma added referenced two the that were programs referenced call on -- last Mark I that quarter. on will in So the first

year you talked the about two, If adding to XX. with ending but eight back Pete, recall, getting back we

and And bit is have make not so generated of those one two bit. up of little is one They professional of But one them programs referenced, that to other live a we fees loading started programs gone fees little those both active. them kind a start-up of live. the but has

little a they has The before bit more other themselves begin time one loading. is giving

that. With respect programs. suited status that’s our of is answer Patient So two better to CEO those the to Affordability,

Affordability, mean, most and folks pharmacy, Yeah. lines other is we organizations. I co-pay are With service along of we that hub are our co-pay Patient sales -- sales providing support in of providing what providers are the talking respect and other vouchers. co-pay cards in to and of

prescriber travel show physical such needs are and and debit needs and debit network we prescriber’s to claims, designed them can and the centralized awareness. medical portals of to electronic providing as deliver as or basically, cards to diems, products to deliver specific So, the cards, patient pharmacy paper enhance to patient practices to such levels solutions affordability claims patient the solutions cards, goals brands, and/or billing virtual direct to medical tools a programs, of of for vouchers, various and used limited payments portals also these processing per brand patient, address meet prescriber detail and of or patient affordability such as medical co-pay

-- it’s are cover, So that are but obviously to those are just offering. some solutions those conversation topic some -- we large of some a of of of the

PaySign Diem, or said started digital That’s Card, you or accounts, say this corporate it. then is by had for so is helpful. thought whether related heard that be services enabled you travel not did you banking Got I’d And that like would Premier for correct? the also for I offering

to for PaySign be might -- that a that we that think other funds. for banking businesses being It other of and services the Digital offered way companies very services around those have offering. of you similar companies card be, need or Yeah. could of that could I the Premier distribution would types to insurance of mean, are in

it. Got

cards use those or one-time generally, so, reloadable? was And

Those the or reloadable in most on situations opportunity. one-time. I it mean would be depends

Okay. will queue. in you. Great. get Thank I back

will Austin Canaccord. from [Operator Moldow go Instructions] to We next

line Your open. is

compares that about contraction favorable Thanks there? led -- had the my to taking less some talk it you you gross much questions. your in for the how plasma margin you last to of noted transactions bit very just Can and segment the when a quarter in

me a look Give to a moment Yeah. take Austin. that, at

in plasma quarter for improvement So we an conversion rate in and margin one see relative revenue quarter to did both gross four.

we So seeing there. some normalcy are

interesting have other tax lower a that a timeframe in typically see rate see quarter first -- benefits We is in receive as donate. monies what’s March they as don’t the and we they the slightly other revenue that of February, much convert revenue a need to customers conversion

bit quarter. conversion spend a lower and So little see revenue the in you first rate

However, hundred rate saw for plasma, think, fourth basis performance the, some margin fourth fourth addressing the on our the to compared that say, the in and plasma partly and the improved quarter we of relative quarter the would several actually increase lackluster conversion in quarter. said, on an to first I points quarter the I business revenue

can -- working and of centers? I means partnering with blood for I you comment if sort with are parity. of you it you Thanks think clarify mentioned donation when And that that it. heard Got centers, what you kinds on blood meant other a

Mark?

new come collection collection product blood to Yeah. product and just blood pipeline lines are have something into and some those we centers, that In relation our are pursuing.

Okay.

So opportunities the are company. that to those available are

is I or and mentioned as a plasma one signings Got that, Is more color any of contract pharma. closing? anticipated did last you. pipeline think, robust the you can there give question, And Can you last can. if kind form maybe I to for you quarter

we though indicated what can we even quarter, we and end like that we we call, had mentioned we to they first to the -- quarter new don’t clients. I our the closed that since slight pharma when things hadn’t delay We two to we Yeah. you last call did new about in you Probably mean, in talk signed until say year occur. first pharma the not,

ahead in the certainly something beginning that. or April to May, of had go we signed we you the month about would If tell of want and

We well than would we have but it into several say are opportunities premature that. be that more to

Okay. Thanks very much.

bet. You

Instructions] We next [Operator Hickman Jon go with will to Ladenburg.

open. is line Your

of kind you what levels I the on year-over-year for to Could a your SG&A this year color basis? grow get a expect little on

a a let me have take at general peek more Yeah. I but idea, just look Taking it, one Jon, time. a

Okay.

this. a bit have we about talked mean, little I

am to QX. a QX was to I jump -- from asking fairly QX there because Q healthy

up line. I rolled Understood. Understood. Yeah. haven’t into consolidated a

let on about that. me it’s we it specifically look was XX.X% SG&A. So moment and let back direction is to say halfway me about like I a make modeled. at decent what going that the to take give looks actually I have sure I Nothing at just have got XX.X%, you mysterious

people, total some There’s look that infrastructure, Affordability business. That’s as the tremendous significant make for we market addressable And are and capabilities. in and play in opportunities. are in investments in the we Mark we about, making a company, we talked sure different just opportunity, as Patient of at technology investments very the the future a making

we a build something from that’s make right investments want it We so objective. to be to to want the light right short-term on and achieve don’t the get-go. And

seeing that’s this but you are to of that we quarter, what XX% year. is should about So first in what projecting kind for are XX% that we in range see

then know some, the unhappy talk for maybe don’t year, is centers like, you all? changing Your environment at financial plasma? or And I that competitor see gathered it last about you you plasma I quite anything mean have a having can about looks the know, I difficulties, I a few is Okay. do little can there, competitive ask bit main

with what this share. go are speak and to that saying at think, too going try take at further, continue to that is can’t that are I time. I anything take about competitor point a we problems we this point. understand In always to I the mean, in much to what do, having really going I which mean we I out pass and to you to do are our market relation is pre-empting

Okay.

comment harder So getting take easier it’s if you market share? or can’t to

difference. I making much on too else I much well that too currently say mean, not a of right sure I yeah, now it’s wearing have But, competitors. I don’t it’s think to am our it. about don’t

very year, in say end year-over-year revenue the similar you that you about comments your did I Is say the At that not? growth or for XXXX? expect of as you what growth heard

No. growth… statement, Similar expect XXXX. gross margins, separate continued gross see growth and as to we Revenue similar to a margins

Okay.

guidance prior a go we gave we look think all at That haven’t back for was changed you growth. revenue anything, …I said. about and we if the call, range on

Okay. Thank it from you. That’s me.

bet, You Jon.

question we will And Heckmann take Peter a follow-up from with Davidson.

Your line is open.

Hey.

a of see quick maybe you a of could Just plasma might a follow-up, of couple give us this year. terms we projection, new centers in what range net

in on it the contracted through that You of year. so few, talk the about some come can timing have kind you and they might the

Yeah. Don’t have projection. a

XX think, XX last to you at that XXX As something with and we know, sitting year, like XX added programs. centers, moment, year. the I centers This other pharma are four we programs

combined sit So at right we programs. XXX that’s where now

would of we of business. In There’s those picking can in which therefore, cases centers. be large for secured can tenuous. pipeline be centers, handful some In the case be be project, a new guessing. that a to occurring a and Difficult item is is bit number to other going obviously conversation exactly

was down Got revenue that think number same you in would and amount it. revenue about -- of of just then you believe in else talk revenue almost were exclusively there was the other it. or in the anything I that terms units figure be or as conversion Got of terms plasma so terms units, about? that were of changes should April, And down, about a when decline XX% in

year. the rate rate at go at quarter last last did not April We April look month year. back We the of conversion April’s did and and year. this at the conversion We specifically quarter conversion I revenue. specifically current fourth the at quarter rates look look last the did Yeah. year. the and for look didn’t of at for But

can’t tend conversion it’s down. trickling rates, just I loaded, donations i.e. being down revenue dollars So and being to on I comment overall would to think through similar and therefore, probably that. that

I… But Great. Great.

go -- But I ahead.

ahead. Go Yeah.

So good. that’s

Newcomer, coming resulted spikes reference But, who system, economy, And core you financial have compensation so, the the effect Mark the that historically, for any that stay on plasma has you if does and think, I have in and so, unemployment in are volumes crisis. centers generally that for only the on through volume constant call, a does that giving those? or seen slowing a has one the when are

they there that mean factors raise mean that not compensation could quite possible are plasma to more it’s collect and they some and several giving. specialized it’s plasma. plasma they that prices collect there competitive they and are that. very change to whether a market the I the it mean, that like the are to try -- I things as out It’s or offering try try, of they I

do. too have much I speak well to but anything, done seen to fairly seemed -- upturn that we and can’t be seen what have of an they not So we what Typically, If we these downturn however, much downturn. from markets, a effect. in will it an haven’t

Yeah. I completely is animal. mean, obviously, COVID-XX different a

to still Well, we are think, I trying understand…

Yeah.

until a hands COVID-XX …and starts to around stabilize little bit, hard our to and get say. the it’s that

helpful. you. Got Thank it. That’s

are You welcome.

the today. am this that questions for I have additional call time. we back further no And closing Instructions] will or showing [Operator at any turn I remarks

Again, with the Pricilla. this am of I -- the you, with very strength pleased result Thank quarter.

focus you participation you your earnings nice a to our for evening. your and on your the grow questions mission continue call Thank continued have company. will in all interest, to the We and

today’s This you participation. for conclude program. Thank does your

any disconnect time. may You at