Summary of Repay (RPAY) FY Conference Call - August 13, 2025 Company Overview - Repay is an integrated payment technology company that provides payment processing solutions for both consumer and B2B payments, with a focus on embedding technology into various software platforms [1][4] - The company has approximately 286 software integrations, with 80% of its business related to consumer bill pay and 20% to business payments [5][6] Key Financial Highlights - Q2 results showed solid progress with sequential growth, returning to high single-digit to low double-digit growth rates [2][35] - Revenue increased, with normalized gross profit margins at 42% on an EBITDA basis [36][39] - Free cash flow was reported at 71%, with a goal to maintain over 60% as the year progresses [36] - The company ended the quarter with over $160 million in cash and has repurchased $38 million in stock year-to-date [39][41] Strategic Focus and Market Position - Repay is focusing on the accounts payable (AP) side of the business, which is seen as a significant growth opportunity [11][12] - The company has a vendor network of approximately 440,000, which is expected to drive synergies and growth [12][16] - A strategic review was conducted to optimize the go-to-market strategy, including enhancing the sales force and client engagement activities [20][25] Competitive Advantages - Repay owns its own clearing and settlement engine, providing a cost advantage over competitors who rely on third-party processors [27][29] - The company is positioned to benefit from market consolidation, which may disrupt competitors and create new opportunities [30] Growth Opportunities - The company is investing in enterprise sales and has seen positive bookings, particularly in the automotive and healthcare sectors [56][57] - Emerging markets, such as mortgage payments, are being targeted for growth, with potential partnerships with card networks to facilitate new payment flows [61][62] Future Outlook - Repay aims to return to growth after experiencing client losses in the previous quarter, with expectations of positive sequential growth in Q3 and Q4 [50][54] - The company is considering capital allocation strategies, including potential M&A opportunities, particularly in the B2B space [46][47] Management Changes - A new CFO, Rob Hauser, will join the company, bringing extensive experience in the payment space [49] Additional Insights - The company emphasizes the importance of cost-effective payment solutions to meet consumer demands, particularly in the mortgage payment sector [62][65] - Repay is optimistic about its growth trajectory, supported by a strong balance sheet and ongoing investments in technology and sales [58][66]

Group 1: Earnings Performance - Repay Holdings reported quarterly earnings of $0.20 per share, matching the Zacks Consensus Estimate, but down from $0.22 per share a year ago [1] - The company had a revenue of $75.63 million for the quarter ended June 2025, exceeding the Zacks Consensus Estimate by 1.25% and up from $74.91 million year-over-year [2] - Over the last four quarters, Repay Holdings has not surpassed consensus EPS estimates [1] Group 2: Stock Performance and Outlook - Repay Holdings shares have declined approximately 32.5% year-to-date, contrasting with the S&P 500's gain of 8.6% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters [4] - The current consensus EPS estimate for the next quarter is $0.20 on revenues of $77.41 million, and for the current fiscal year, it is $0.86 on revenues of $309.31 million [7] Group 3: Industry Context - The Financial Transaction Services industry, to which Repay Holdings belongs, is currently in the top 30% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Repay Holdings' stock performance [5][6]

Financial Data and Key Metrics Changes - In Q2 2025, revenue was $75.6 million, representing a 1% year-over-year increase [17] - Reported gross profit declined by 2% year-over-year, impacted by approximately five points from client losses and one point from political media contributions [17] - Adjusted EBITDA was $31.8 million, reflecting a 42% adjusted EBITDA margin, with free cash flow of $22.6 million and a 71% free cash flow conversion [19][20] Business Line Data and Key Metrics Changes - Consumer Payments segment showed flat gross profit year-over-year, with improvements expected as client losses are lapped [18] - Business Payments segment reported a 5% year-over-year decline in gross profit, but normalized gross profit increased approximately 1% when excluding political media contributions [18] - The total supplier network grew by 47% year-over-year to over 440,000 suppliers, indicating strong growth in the Business Payments segment [13] Market Data and Key Metrics Changes - The financial institution vertical onboarded 10 new credit union clients, increasing the total credit union client base to 353 [10] - The company is experiencing sustainable bookings growth across its consumer verticals, supported by a healthy sales pipeline with 185 software partners [8] Company Strategy and Development Direction - The core growth strategy focuses on optimizing payment flows and embedding payment technology into software platforms [5] - The company is prioritizing organic growth investments and maintaining a strong balance sheet while preparing for the maturity of convertible notes in 2026 [15][20] - Strategic tuck-in M&A opportunities are being considered to enhance growth potential, particularly in consumer and business payments [15][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving high single-digit to low double-digit normalized gross profit growth in Q4 2025, driven by sequential improvements [15][25] - The company is focused on reaccelerating growth and enhancing operational excellence as it moves through 2025 and into 2026 [60] Other Important Information - The company repurchased approximately 5% of its outstanding shares, totaling $38 million year-to-date [14][20] - Robert Houser has been appointed as the new Chief Financial Officer, effective September 8 [16] Q&A Session Summary Question: Guidance for the second half of the year - Management expects sequential improvement in growth, with confidence in achieving high single-digit to low double-digit normalized growth in Q4 [25] Question: Capital management priorities regarding convertible notes - The company will prioritize cash allocation towards the convertible notes due in February 2026, while also considering the use of revolver capacity [27] Question: Strategic tuck-in M&A opportunities - Management is open to strategic acquisitions that align with their existing verticals in consumer and business payments [30] Question: Moving upmarket into larger customers - The company is investing in enterprise sales and enhancing its direct sales model to target larger customers within existing verticals [38] Question: Update on mortgage payments market - There is positive traction in the mortgage payments market, but it is not expected to be a significant contributor in 2025 [40] Question: Update on RCS partnership with POS provider - No significant updates, but the relationship is viewed positively with ongoing implementations [43] Question: Mix between AR and AP in the B2B segment - The mix is approximately 60% AR and 40% AP [46] Question: Consumer payments softness - Management noted challenges in the auto segment but sees resilient trends overall, with no significant impacts from tariffs [50]

Financial Performance - Q2 2025 - Revenue increased by 1% year-over-year, from $74.9 million in Q2 2024 to $75.6 million in Q2 2025 [13] - Gross profit decreased by 2% year-over-year, from $58.6 million in Q2 2024 to $57.2 million in Q2 2025 [13] - Adjusted EBITDA decreased by 6% year-over-year, from $33.7 million in Q2 2024 to $31.8 million in Q2 2025 [13] - Free cash flow increased by 17% year-over-year, from $19.3 million in Q2 2024 to $22.6 million in Q2 2025 [13] - Free Cash Flow conversion increased from 57% to 71% [13] Segment Performance - Consumer Payments revenue increased by 2% year-over-year, from $69.3 million in Q2 2024 to $70.5 million in Q2 2025 [18] - Business Payments revenue increased by 9% year-over-year excluding political media, but decreased by 3% as reported [21] Liquidity and Debt - Total liquidity was $413 million as of June 30, 2025 [25, 49] - Net leverage ratio was 2.5x as of June 30, 2025, with net debt of $345 million and LTM Adjusted EBITDA of $137 million [27] Outlook - The company reiterates its previously provided financial outlook and expects sequential quarterly acceleration in normalized growth year-over-year [32]

[PART I – FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Condensed Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) The company reported a $108.0 million net loss in Q2 2025, largely due to a $103.8 million goodwill impairment Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $162,615 | $189,530 | ($26,915) | | Goodwill | $613,012 | $716,793 | ($103,781) | | Intangible assets, net | $359,827 | $389,034 | ($29,207) | | Total Assets | $1,413,374 | $1,571,908 | ($158,534) | | Total Liabilities | $773,970 | $798,739 | ($24,769) | | Total Equity | $639,404 | $773,169 | ($133,765) | Condensed Consolidated Statements of Operations Highlights (in thousands) | Metric | Q2 2025 | Q2 2024 | Y/Y Change | H1 2025 | H1 2024 | Y/Y Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $75,626 | $74,906 | +0.9% | $152,951 | $155,626 | -1.7% | | Impairment loss | $103,781 | $0 | N/A | $103,781 | $0 | N/A | | Loss from operations | ($104,904) | ($3,421) | +2878.8% | ($108,524) | ($5,925) | +1731.6% | | Net loss | ($108,032) | ($4,237) | +2449.7% | ($116,200) | ($9,602) | +1110.2% | | Net loss attributable to the Company | ($102,251) | ($4,071) | +2411.7% | ($110,198) | ($9,283) | +1087.1% | | Basic and diluted EPS | ($1.15) | ($0.04) | +2775.0% | ($1.24) | ($0.10) | +1140.0% | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $35,568 | $55,780 | | Net cash used in investing activities | ($21,002) | ($22,820) | | Net cash used in financing activities | ($42,295) | ($3,069) | [Note 3. Revenue](index=11&type=section&id=Note%203.%20Revenue) Total revenue for Q2 2025 increased slightly to $75.6 million, with Consumer Payments remaining the primary driver Revenue by Segment (in thousands) | Segment | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Consumer Payments | $70,474 | $69,292 | $142,417 | $145,428 | | Business Payments | $10,945 | $10,592 | $21,933 | $20,269 | | Elimination of intersegment | ($5,793) | ($4,978) | ($11,399) | ($10,071) | | **Total Revenue** | **$75,626** | **$74,906** | **$152,951** | **$155,626** | [Note 7. Goodwill](index=17&type=section&id=Note%207.%20Goodwill) A $103.8 million goodwill impairment was recorded, mainly in Consumer Payments, due to stock price and valuation changes - A goodwill impairment loss of **$103.8 million** was recorded in Q2 2025, with **$103.2 million** attributed to the Consumer Payments segment and **$0.6 million** to the Business Payments segment[56](index=56&type=chunk)[58](index=58&type=chunk) - The impairment was triggered by a decline in the company's stock price, leading to a quantitative analysis that confirmed the impairment, with fair value impacted by changes in the discount rate and lower comparable company multiples[56](index=56&type=chunk)[58](index=58&type=chunk) [Note 8. Borrowings](index=19&type=section&id=Note%208.%20Borrowings) Total borrowings reached $498.4 million, including convertible notes, with a $250.0 million undrawn revolving credit facility Borrowings Summary (in thousands) | Debt Instrument | Principal Amount | Carrying Value (June 30, 2025) | Fair Value (June 30, 2025) | | :--- | :--- | :--- | :--- | | 2026 Notes | $220,000 | $219,389 | $210,760 | | 2029 Notes | $287,500 | $280,736 | $235,750 | | Revolving credit facility | $0 | ($1,727) | $0 | | **Total** | **$507,500** | **$498,398** | **$446,510** | - The company entered into a Second Amended and Restated Revolving Credit Agreement for a **$250.0 million** facility maturing in July 2029, with no amounts drawn as of June 30, 2025[59](index=59&type=chunk)[60](index=60&type=chunk) [Note 13. Segments](index=27&type=section&id=Note%2013.%20Segments) Consumer Payments revenue increased 1.7% to $70.5 million, while Business Payments revenue grew 3.8% to $10.9 million in Q2 2025 Segment Performance (in thousands) | Segment | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Consumer Payments** | Revenue | $70,474 | $69,292 | $142,417 | $145,428 | | | Gross Profit | $55,429 | $55,546 | $112,139 | $115,136 | | **Business Payments** | Revenue | $10,945 | $10,592 | $21,933 | $20,269 | | | Gross Profit | $7,586 | $8,017 | $15,143 | $15,065 | - The Consumer Payments segment accounted for approximately **86%** of total revenue in Q2 2025, consistent with the prior year[91](index=91&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 2025 revenue increased 0.9%, but net loss significantly widened to $102.3 million due to a $103.8 million goodwill impairment [Results of Operations](index=32&type=section&id=MD%26A_Results_of_Operations) Q2 2025 revenue increased 0.9% to $75.6 million, but a $103.8 million goodwill impairment led to a substantial net loss - Q2 2025 revenue increased **0.9%** YoY to **$75.6 million**, driven by new and existing client growth, partially offset by client losses and lower political media spending[111](index=111&type=chunk) - A non-cash impairment loss of **$103.8 million** was recognized in Q2 2025, with **$103.2 million** related to the Consumer Payments segment's goodwill, primarily driving the significant increase in net loss[115](index=115&type=chunk) - Selling, general and administrative expenses decreased by **6.8%** YoY, primarily due to a **$3.6 million** reduction in equity compensation expenses[113](index=113&type=chunk) [Segments](index=35&type=section&id=MD%26A_Segments) Consumer Payments revenue grew 1.7% to $70.5 million, while Business Payments revenue increased 3.8% to $10.9 million in Q2 2025 Segment Gross Profit (in thousands) | Segment | Q2 2025 | Q2 2024 | Y/Y Change | | :--- | :--- | :--- | :--- | | Consumer Payments | $55,429 | $55,546 | -0.2% | | Business Payments | $7,586 | $8,017 | -5.0% | | **Total Gross Profit (after eliminations)** | **$57,222** | **$58,585** | **-2.3%** | [Non-GAAP Financial Measures](index=37&type=section&id=MD%26A_Non-GAAP_Financial_Measures) Adjusted EBITDA decreased 5.7% to $31.8 million, and Adjusted Net Income fell 12.3% to $19.1 million in Q2 2025 Non-GAAP Performance (in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | Y/Y Change | | :--- | :--- | :--- | :--- | | Adjusted EBITDA | $31,811 | $33,728 | -5.7% | | Adjusted Net Income | $19,083 | $21,762 | -12.3% | | Adjusted Net Income per share | $0.20 | $0.22 | -9.1% | - The main adjustments from Net Loss to Adjusted EBITDA include adding back the **$103.8 million** non-cash impairment loss, **$25.5 million** in depreciation & amortization, and **$3.0 million** in share-based compensation expense[149](index=149&type=chunk) [Liquidity and Capital Resources](index=44&type=section&id=MD%26A_Liquidity_and_Capital_Resources) The company maintains strong liquidity with $162.6 million in cash and a $250.0 million undrawn credit facility - The company's liquidity position as of June 30, 2025, includes **$162.6 million** in cash and **$250.0 million** in available borrowing capacity[163](index=163&type=chunk) - The board of directors increased the authorized Share Repurchase Program to **$75 million** in May 2025, with **4.8 million** shares repurchased for **$22.6 million** in Q2 2025[165](index=165&type=chunk) - Net cash from operating activities for the first six months of 2025 was **$35.6 million**, a decrease from **$55.8 million** in the same period of 2024[167](index=167&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=46&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate exposure on its undrawn variable-rate revolving credit facility - The primary market risk is interest rate risk associated with the floating-rate revolving credit facility, where increases in interest rates could increase the cost of debt if utilized[182](index=182&type=chunk) - The company does not expect significant impact from inflation or foreign currency exchange rate risk[180](index=180&type=chunk)[184](index=184&type=chunk) [Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[186](index=186&type=chunk) - No material changes to internal control over financial reporting were identified during the quarter[187](index=187&type=chunk) [PART II – OTHER INFORMATION](index=49&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=49&type=section&id=Item%201.%20Legal%20Proceedings) The company does not anticipate any material adverse effects from ongoing legal proceedings - The company states that it does not expect any currently pending legal proceedings to have a material adverse effect on its business, prospects, or financial results[189](index=189&type=chunk) [Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported for the quarter - No material changes to risk factors were reported for the quarter[190](index=190&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=49&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased over 5 million shares at an average price of $4.72 per share during Q2 2025 Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Program | | :--- | :--- | :--- | :--- | | April 2025 | 619 | $4.39 | — | | May 2025 | 1,667,033 | $4.39 | 1,411,298 | | June 2025 | 3,356,296 | $4.88 | 3,353,168 | | **Total** | **5,023,948** | **$4.72** | **4,764,466** | [Other Information](index=49&type=section&id=Item%205.%20Other%20Information) The General Counsel adopted a Rule 10b5-1 trading plan for the potential sale of up to 90,000 shares - The company's General Counsel, Tyler B. Dempsey, adopted a Rule 10b5-1 trading plan on June 13, 2025, for the sale of up to **90,000** shares of Class A common stock[195](index=195&type=chunk) [Exhibits](index=51&type=section&id=Item%206.%20Exhibits) The report includes required exhibits and certifications from key executive officers

[Financial & Business Highlights](index=1&type=section&id=Financial%20%26%20Business%20Highlights) [Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) REPAY reported Q2 2025 revenue of $75.6 million, a slight increase, but incurred a significant net loss primarily due to a non-cash goodwill impairment, while achieving strong Free Cash Flow with a high conversion rate Q2 2025 Key Financial Metrics ($ in millions) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $75.6M | $74.9M | +0.9% | | Gross Profit | $57.2M | $58.6M | -2.4% | | Net Loss | $(108.0)M | $(4.2)M | N/A | | Adjusted EBITDA | $31.8M | $33.7M | -5.6% | | Free Cash Flow | $22.6M | $19.3M | +17.1% | | Free Cash Flow Conversion | 71% | 57% | +14 p.p. | - The net loss in Q2 2025 was primarily driven by a non-cash goodwill impairment loss of **$103.8 million**, mainly related to the Consumer Payments segment[3](index=3&type=chunk)[10](index=10&type=chunk) [Second Quarter 2025 Business Highlights](index=1&type=section&id=Second%20Quarter%202025%20Business%20Highlights) REPAY's Q2 2025 business performance was mixed, with gross profit declines due to client losses, yet strong growth in its AP supplier network and instant funding volumes, alongside expanded partnerships - Reported and normalized gross profit declined by **2%** and **1% YoY**, respectively, due to the impact of previously announced client losses[6](index=6&type=chunk) - The AP supplier network grew to over **440,000**, an increase of approximately **47% year-over-year**[10](index=10&type=chunk) - Instant funding volumes increased by approximately **38% year-over-year**[10](index=10&type=chunk) - The company added **3 new integrated software partners**, reaching a total of **286**, and added **10 new credit unions**, for a total of **353**[10](index=10&type=chunk) [Management Commentary and Capital Allocation](index=1&type=section&id=Management%20Commentary%20and%20Capital%20Allocation) CEO John Morris emphasized strategic investments for reaccelerating growth and operational excellence, with a key capital allocation being the repurchase of approximately 5% of outstanding shares - Management is focused on strategic investments to reaccelerate growth, expecting momentum from these initiatives to build towards the end of the year[5](index=5&type=chunk) - The company repurchased **4.8 million shares** for **$22.6 million** during Q2 2025[1](index=1&type=chunk) - Through August 11, 2025, a total of **$38 million** has been used for share repurchases during the year[5](index=5&type=chunk) [Business Segments & Outlook](index=2&type=section&id=Business%20Segments%20%26%20Outlook) [2025 Outlook](index=2&type=section&id=2025%20Outlook) REPAY reiterates its full-year 2025 outlook, anticipating sequential quarterly acceleration in normalized gross profit growth and significant improvement in Free Cash Flow Conversion by Q4 - The company reiterates its previously provided outlook for fiscal year 2025[7](index=7&type=chunk) - Expects sequential quarterly acceleration of normalized gross profit growth, with a Q4 YoY growth rate of **high-single digits to low double-digits**[10](index=10&type=chunk) - Free Cash Flow Conversion is projected to accelerate to **over 60%** by the fourth quarter of 2025[10](index=10&type=chunk) [Segment Performance](index=2&type=section&id=Segment%20Performance) In Q2 2025, Consumer Payments saw 2% revenue growth but flat gross profit, while Business Payments had 3% revenue growth but a 5% gross profit decline, with Business Payments showing stronger growth over six months Segment Financials for Three Months Ended June 30 ($ in millions) | Segment | Metric | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | :--- | | **Consumer Payments** | Revenue | $70.5M | $69.3M | +2% | | | Gross Profit | $55.4M | $55.5M | 0% | | **Business Payments** | Revenue | $10.9M | $10.6M | +3% | | | Gross Profit | $7.6M | $8.0M | -5% | Segment Financials for Six Months Ended June 30 ($ in millions) | Segment | Metric | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | :--- | | **Consumer Payments** | Revenue | $142.4M | $145.4M | -2% | | | Gross Profit | $112.1M | $115.1M | -3% | | **Business Payments** | Revenue | $21.9M | $20.3M | +8% | | | Gross Profit | $15.1M | $15.1M | +1% | - The Consumer Payments segment provides solutions for collecting payments from and disbursing funds to consumers in verticals like personal/auto loans and receivables management[9](index=9&type=chunk) - The Business Payments segment provides B2B payment solutions, including AP automation, in verticals such as automotive, healthcare, and media[10](index=10&type=chunk)[11](index=11&type=chunk) [Consolidated Financial Statements](index=6&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statement of Operations](index=6&type=section&id=Consolidated%20Statement%20of%20Operations) REPAY's Q2 2025 total revenue slightly increased to $75.6 million, but operating expenses surged to $180.5 million due to a $103.8 million impairment loss, resulting in a significant net loss of $102.3 million or $(1.15) per share Q2 Statement of Operations Highlights ($ in thousands) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Revenue | $75,626 | $74,906 | | Total operating expenses | $180,530 | $78,327 | | Impairment loss | $103,781 | $0 | | Loss from operations | $(104,904) | $(3,421) | | Net loss attributable to the Company | $(102,251) | $(4,071) | | Loss per Class A share | $(1.15) | $(0.04) | [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, REPAY's total assets decreased to $1.41 billion, primarily due to a goodwill impairment, while total liabilities and stockholders' equity also declined Balance Sheet Summary ($ in thousands) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $162,615 | $189,530 | | Goodwill | $613,012 | $716,793 | | Total Assets | $1,413,374 | $1,571,908 | | Total Liabilities | $773,970 | $798,739 | | Total Equity | $639,404 | $773,169 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the first six months of 2025, net cash from operating activities decreased to $35.6 million, while significant cash was used in financing activities for share repurchases and Tax Receivable Agreement payments, leading to a decrease in cash and cash equivalents Six Months Cash Flow Summary ($ in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $35,568 | $55,780 | | Net cash used in investing activities | $(21,002) | $(22,820) | | Net cash used in financing activities | $(42,295) | $(3,069) | | Increase in cash, cash equivalents and restricted cash | $(27,729) | $29,891 | - Key uses of cash in financing activities for the first half of 2025 included **$22.6 million** for treasury share repurchases and **$16.3 million** for payment of the Tax Receivable Agreement[29](index=29&type=chunk) [Non-GAAP Financial Measures & Reconciliations](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) [Reconciliation of Net Income to Adjusted EBITDA](index=9&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20EBITDA) Adjusted EBITDA for Q2 2025 was $31.8 million, down from Q2 2024, with reconciliation from net loss including significant add-backs for non-cash impairment, depreciation, amortization, and share-based compensation Adjusted EBITDA Reconciliation for Q2 ($ in thousands) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net loss | $(108,032) | $(4,237) | | Add: Non-cash impairment loss | $103,781 | $0 | | Add: Depreciation and amortization | $25,481 | $26,771 | | Add: Share-based compensation | $3,049 | $5,874 | | **Adjusted EBITDA** | **$31,811** | **$33,728** | [Reconciliation of Net Income to Adjusted Net Income](index=12&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20Net%20Income) Adjusted Net Income for Q2 2025 was $19.1 million or $0.20 per share, with key adjustments to GAAP net loss including impairment, amortization of intangibles, and share-based compensation Adjusted Net Income Reconciliation for Q2 ($ in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net loss | $(108,032) | $(4,237) | | Add: Amortization of acquisition-related intangibles | $19,506 | $19,702 | | Add: Non-cash impairment loss | $103,781 | $0 | | **Adjusted Net Income** | **$19,083** | **$21,762** | | **Adjusted Net Income per share** | **$0.20** | **$0.22** | [Reconciliation of Operating Cash Flow to Free Cash Flow](index=14&type=section&id=Reconciliation%20of%20Operating%20Cash%20Flow%20to%20Free%20Cash%20Flow) REPAY generated $22.6 million in Free Cash Flow in Q2 2025, an increase from the prior year, calculated from operating cash flow minus capital expenditures, with the conversion rate significantly improving to 71% Free Cash Flow Reconciliation for Q2 ($ in thousands) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $33,065 | $30,979 | | Total capital expenditures | $(10,465) | $(11,691) | | **Free cash flow** | **$22,600** | **$19,288** | | **Free cash flow conversion** | **71%** | **57%** | [Reconciliation of Gross Profit Growth to Normalized Gross Profit Growth](index=14&type=section&id=Reconciliation%20of%20Gross%20Profit%20Growth%20to%20Normalized%20Gross%20Profit%20Growth) REPAY presents normalized gross profit growth, adjusting for political media spending, showing a total normalized decline of -1% for Q2 2025 compared to a reported -2% decline Normalized Gross Profit Growth Reconciliation for Q2 2025 vs Q2 2024 | Segment | Gross Profit Growth | Less: Political Media Impact | Normalized Gross Profit Growth | | :--- | :--- | :--- | :--- | | Consumer Payments | (0%) | — | (0%) | | Business Payments | (5%) | (6%) | 1% | | **Total** | **(2%)** | **(1%)** | **(1%)** |

Financial Performance & Credit Profile - HighPeak Energy reported Q2 2025 production of 486 thousand Boe/d [14] - The company's Q2 2025 unhedged EBITDAX per BOE was $3358 [14] - Q2 2025 EBITDAX reached $156 million [14] - As of June 30, 2025, the company's total net debt was $1032 million [16] - Total Proved PV-10 was $3529 million [16] - Total liquidity stood at $268 million, including $168 million in cash and cash equivalents [16] - The company's Net Debt / TTM EBITDAX ratio is 14x [16] Debt & Hedging - HighPeak Energy extended Term Loan and Revolving Credit Facility maturities to September 2028 [21] - The Term Loan was upsized to $12 billion [21] - Approximately 53% of 2H25 oil volumes are hedged [25] - Approximately 89% of 2H25 gas volumes are hedged [25] Operational Efficiency & Cost Savings - Simulfrac operations saved approximately $400000 per well [29] - The company achieved solar savings of $809487 from June to December 2024 [34] - Completion costs decreased by 3-5% due to simulfrac savings of 10% [30]

Core Insights - Repay Holdings (NASDAQ: RPAY) is experiencing a stagnant share price, but there are signs of a potential inflection point that may not be immediately apparent [1] Company Analysis - The current trading price of Repay Holdings does not reflect the underlying opportunities that may arise from market overreactions or shifts in business models [1] - The company is positioned within the financial and technology sectors, which are known for their volatility and potential for asymmetric investment opportunities [1]

Core Viewpoint - Repay Holdings (RPAY) reported quarterly earnings of $0.22 per share, missing the Zacks Consensus Estimate of $0.23 per share, representing a -4.35% earnings surprise [1][2] Financial Performance - The company posted revenues of $77.33 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 7.06%, compared to $80.72 million in the same quarter last year [2] - Over the last four quarters, Repay Holdings has surpassed consensus EPS estimates just once and topped consensus revenue estimates two times [2] Stock Performance - Repay Holdings shares have declined approximately 48.4% since the beginning of the year, while the S&P 500 has decreased by 3.8% [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.22 on revenues of $78.49 million, and for the current fiscal year, it is $0.91 on revenues of $331.6 million [7] - The estimate revisions trend for Repay Holdings is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Financial Transaction Services industry, to which Repay Holdings belongs, is currently in the top 30% of over 250 Zacks industries, suggesting a favorable industry outlook [8]

Financial Data and Key Metrics Changes - In Q1 2025, revenue was $77.3 million, representing a decrease of 4% year over year [22] - Reported gross profit declined by 5% year over year, with consumer payment segment gross profit also down by 5%, while business payment segment gross profit increased by 77% year over year [22] - Adjusted EBITDA for Q1 was $33.2 million, maintaining an adjusted EBITDA margin of approximately 43% [23] - Reported free cash flow was negative $8 million, impacted by client losses and working capital changes, but excluding these impacts, free cash flow conversion would have been similar to 38% in Q1 2024 [24] Business Line Data and Key Metrics Changes - Consumer payments showed core growth with contributions from existing clients and new client wins, despite client losses impacting reported growth [8][12] - Business payments reported a gross profit increase of approximately 7% year over year, with a normalized growth of about 12% when excluding political media contributions from the previous year [13][22] - Instant funding product in value-added services saw transaction volumes rise approximately 19% year over year [11] Market Data and Key Metrics Changes - Non-discretionary consumer spending remained resilient year to date, with no major impacts observed from macroeconomic factors [9][52] - The company signed two new software partnerships in consumer payments, increasing total software partners to 182 [10] Company Strategy and Development Direction - The company concluded its strategic review process, focusing on organic growth investments rather than M&A, believing this will yield the best results for shareholders [16][17] - Key operational priorities include enhancing the direct sales model, capitalizing on monetization opportunities, and building indirect partnership channels [17] - The company aims for sequential quarterly normalized gross profit growth, projecting high single-digit to low double-digit growth by Q4 2025 [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to invest organically and produce results that generate shareholder value, with expectations for growth acceleration in the second half of 2025 [18][19] - The macroeconomic environment has changed, but the company remains focused on profitable growth and cash flow generation [16][19] Other Important Information - The Board of Directors increased the share repurchase program authorization to $75 million, maintaining a strong balance sheet with ample liquidity [19][25] - Tim Murphy, the CFO, will be stepping down, with Thomas Sullivan appointed as interim CFO [20][19] Q&A Session Summary Question: Can you provide additional color on the consumer spending environment? - Management noted resiliency in non-discretionary consumer spending, with no major impacts from overall payment processing related to macroeconomic factors [29] Question: Given the increased buyback authorization, do you plan to continue leaning into this rather than M&A? - Management confirmed that they will opportunistically repurchase shares when the share price is disconnected from intrinsic value, while focusing on organic growth [30][31] Question: How far did you go down the strategic review process? - The company assessed various strategic alternatives but concluded that additional investment in organic growth would yield the best results for shareholders [34] Question: Can you help us think about the EBITDA growth trajectory over 2025? - Management indicated that adjusted EBITDA growth would follow a similar path as gross profit growth, with no incremental spend beyond what has been forecasted [38] Question: What are you seeing in terms of repayment volume health in the auto vertical? - Management reported strength in nondiscretionary spending in the auto sector, with no specific issues observed [77]