Nuvei (NVEI) - 2023 Q4 - Annual Report

Introduction & Company Information Nuvei Overview Nuvei Corporation announced its financial results for the three months and year ended December 31, 2023, reporting in U.S. dollars and in accordance with IFRS - Nuvei Corporation (Nasdaq: NVEI) (TSX: NVEI), a Canadian fintech company, reported its financial results for Q4 and FY 2023[1] - The company reports in U.S. dollars and adheres to International Financial Reporting Standards (IFRS)[1] About Nuvei Nuvei is a Canadian fintech company providing modular, flexible, and scalable technology to accelerate client businesses globally, offering next-gen payments, payout options, card issuing, banking, risk, and fraud management services across over 200 markets - Nuvei is a Canadian fintech company focused on accelerating client businesses worldwide[24] - The company offers modular, flexible, and scalable technology for next-gen payments, payout options, card issuing, banking, risk, and fraud management services[24] - Nuvei connects businesses to customers in over 200 markets, with local acquiring in 50 markets, supporting 150 currencies and 680 alternative payment methods[24] Financial Highlights Three Months Ended December 31, 2023 Nuvei reported strong financial growth in Q4 2023, with total volume increasing by 53% and revenue by 46%, while net income saw a significant 51% rise and Adjusted EBITDA grew by 40% Q4 2023 Financial Highlights | Metric | Q4 2023 | Q4 2022 | Change (%) | | :--------------------------------- | :---------- | :---------- | :--------- | | Total Volume | $61.8 billion | $40.3 billion | 53% | | Organic Total Volume (constant currency) | $47.9 billion | $40.3 billion | 19% | | Revenue | $321.5 million | $220.3 million | 46% | | Revenue (constant currency) | $316.6 million | $220.3 million | 44% | | Organic Revenue (constant currency) | $235.3 million | $220.3 million | 7% | | Net Income | $14.1 million | $9.4 million | 51% | | Net Income Margin | 4.4% | 4.2% | +0.2pp | | Adjusted EBITDA | $120.1 million | $85.7 million | 40% | | Adjusted EBITDA Margin | 37.3% | 38.9% | -1.6pp | | Adjusted Net Income | $68.6 million | $68.0 million | 1% | | Net Income per Diluted Share | $0.08 | $0.06 | 39% | | Adjusted Net Income per Diluted Share | $0.47 | $0.47 | 0% | | Adjusted EBITDA less CapEx | $105.2 million | $71.2 million | 48% | Year Ended December 31, 2023 For the full year 2023, Nuvei achieved substantial growth in total volume (59%) and revenue (41%), but reported a net loss of $0.7 million primarily due to increased net finance costs, while Adjusted EBITDA increased by 24% FY 2023 Financial Highlights | Metric | FY 2023 | FY 2022 | Change (%) | | :--------------------------------- | :---------- | :---------- | :--------- | | Total Volume | $203.0 billion | $127.7 billion | 59% | | Organic Total Volume (constant currency) | $156.5 billion | $127.7 billion | 23% | | Revenue | $1,189.9 million | $843.3 million | 41% | | Revenue (constant currency) | $1,186.5 million | $843.3 million | 41% | | Organic Revenue (constant currency) | $922.0 million | $843.3 million | 9% | | Net Loss (vs. Net Income) | ($0.7 million) | $62.0 million | -101% | | Net Loss Margin (vs. Net Income Margin) | 0.1% | 7.3% | -7.2pp | | Adjusted EBITDA | $437.3 million | $351.3 million | 24% | | Adjusted EBITDA Margin | 36.8% | 41.7% | -4.9pp | | Adjusted Net Income | $247.9 million | $274.2 million | -10% | | Net Loss per Share (vs. Net Income per Diluted Share) | ($0.06) | $0.39 | -115% | | Adjusted Net Income per Diluted Share | $1.69 | $1.86 | -9% | | Adjusted EBITDA less CapEx | $382.3 million | $303.0 million | 26% | | Share Repurchases | 1.35 million shares | - | $56 million cash | | Cash Dividends Paid | $27.9 million | - | - | | Long Term Debt Repaid | $127.8 million | - | - | | Combined Leverage Ratio (as of Dec 31, 2023) | 2.5x | - | - | - The net loss for FY 2023 was primarily driven by an increase in net finance costs of $102.9 million, mainly related to amounts drawn under the Company's credit facilities[6] Revenue Performance Revenue by Region Nuvei experienced revenue growth across all geographic regions in both Q4 and the full year 2023, with North America showing the most significant increases Revenue by Region (Q4 and FY 2023) | Region | Q4 2023 Revenue | Q4 2022 Revenue | Q4 Change (%) | FY 2023 Revenue | FY 2022 Revenue | FY Change (%) | | :-------------------- | :-------------- | :-------------- | :------------ | :-------------- | :-------------- | :------------ | | North America (NA) | $177.49 million | $89.39 million | 99% | $642.60 million | $336.56 million | 91% | | Europe, Middle East, Africa (EMEA) | $125.82 million | $115.90 million | 9% | $487.80 million | $465.94 million | 5% | | Latin America (LATAM) | $14.53 million | $12.18 million | 19% | $51.37 million | $33.11 million | 55% | | Asia Pacific (APAC) | $3.68 million | $2.87 million | 28% | $8.13 million | $7.72 million | 5% | | Total Revenue | $321.52 million | $220.34 million | 46% | $1,189.89 million | $843.32 million | 41% | Revenue by Channel In Q4 2023, Nuvei's Global commerce channel remained the largest contributor to revenue, growing 12% year-over-year on a pro forma basis, while the B2B, government and ISV channel showed significant growth Q4 2023 Revenue by Channel (Pro Forma) | Channel | Q4 2023 Revenue | % of Total Revenue (Q4) | YoY Pro Forma Growth (Q4) | | :------------------------------------ | :-------------- | :---------------------- | :------------------------ | | Global commerce | $181 million | 56% | 12% | | B2B, government and ISV | $59 million | 18% | 19% | | Small and medium-sized businesses (SMB) | $82 million | 26% | 2% | | Total Revenue | $322 million | 100% | 11% | - The company distributes products through Global commerce (mid-market to large enterprise), B2B, government and ISV (embedded payment capabilities), and SMB (North American card acceptance) channels[86] Financial Outlook and Growth Targets Financial Outlook for Q1 and FY 2024 Nuvei provided a financial outlook for Q1 and FY 2024, anticipating continued growth in total volume, revenue, and Adjusted EBITDA, including the impact of the Till Payments acquisition Financial Outlook (Q1 and FY 2024) | Metric (in millions of US dollars, except volume in billions) | Q1 2024 (Forward-looking) | FY 2024 (Forward-looking) | | :---------------------------------------------------------- | :------------------------ | :------------------------ | | Total volume | $57 - $58 | $246 - $252 | | Revenue | $322 - $330 | $1,340 - $1,380 | | Revenue at constant currency | $322 - $330 | $1,338 - $1,378 | | Adjusted EBITDA | $110 - $116 | $480 - $510 | - The financial outlook includes the acquisition of Till Payments from January 5, 2024[13] - Nuvei expects underlying quarterly revenue growth rates and Adjusted EBITDA margins to ramp up throughout the year, aiming to exit the year in line with its medium-term revenue growth target of 15-20%[13] - The company is focused on achieving breakeven or better on the Till Payments acquisition before year-end, with an underlying Adjusted EBITDA margin expectation of 36-37% for Q1 2024, consistent with Q4 2023[13][14] Medium and Long-Term Growth Targets Nuvei has set medium-term annual growth targets of 15-20% for revenue and 4-6% of revenue for capital expenditures, alongside a long-term Adjusted EBITDA margin target of 50%+ Medium and Long-Term Growth Targets | Target Category | Target | | :------------------------------------ | :------------------------------------------ | | Revenue (medium-term) | 15% - 20% annual year-over-year growth | | Adjusted EBITDA margin (long-term) | 50%+ | | Capital expenditures (medium-term) | 4% - 6% of Revenue | - Nuvei aims to accelerate growth in its B2B, government and ISV channel to 20%-plus over the medium term[17] Historical Performance (2021-2023) | Metric (in thousands of US dollars, except percentages) | 2021 | 2022 | 2023 | | :---------------------------------------------------- | :--------- | :--------- | :--------- | | Revenue | 724,526 | 843,323 | 1,189,893 | | Revenue annual year-over-year growth (%) | 93% | 16% | 41% | | Adjusted EBITDA | 317,234 | 351,317 | 437,341 | | Adjusted EBITDA margin (%) | 43.8% | 41.7% | 36.8% | | Capital expenditures | 27,169 | 48,322 | 55,080 | | Capital expenditures as a percentage of revenue (%) | 3.7% | 5.7% | 4.6% | - For FY 2023, Organic revenue growth excluding digital assets and cryptocurrencies at constant currency was 17%, and pro forma B2B, government and ISV channel revenue growth was 16%[19] Cash Dividend Nuvei's Board of Directors declared a cash dividend of $0.10 per subordinate voting share and multiple voting share, payable on April 4, 2024, designated as an eligible dividend for Canadian tax purposes - A cash dividend of $0.10 per subordinate voting share and multiple voting share was declared[9] - The dividend is payable on April 4, 2024, to shareholders of record as of March 19, 2024, with an aggregate amount of approximately $14 million[9] - The dividend is designated as an eligible dividend for Canadian income tax purposes and is expected to be reported as a dividend to U.S. shareholders for U.S. federal income tax purposes[10] Non-IFRS and Other Financial Measures Definitions Non-IFRS Financial Measures Nuvei utilizes several non-IFRS financial measures to provide additional insights into its operating performance, complementing IFRS measures by adjusting for non-operational or non-cash items and foreign currency fluctuations - Non-IFRS measures are used to evaluate operating performance, highlight business trends, and facilitate period-to-period comparisons, but are not standardized under IFRS[26] - Key non-IFRS financial measures include[25][26] - Revenue at constant currency: Revenue adjusted for foreign currency exchange fluctuations to show comparable growth[28] - Organic revenue at constant currency: Revenue excluding acquired/divested businesses and adjusted for foreign currency impact[29][30] - Organic revenue excluding digital assets and cryptocurrencies at constant currency: Organic revenue further excluding digital assets and cryptocurrencies and adjusted for foreign currency impact[31] - Adjusted EBITDA: Net income (loss) before finance costs, finance income, depreciation, amortization, income tax, acquisition/integration/severance costs, share-based payments, foreign currency loss/gain, and legal settlement[32] - Paya Adjusted EBITDA: Paya's EBITDA with adjustments for non-cash and non-recurring items, used for combined metrics[33] - Combined trailing twelve months Adjusted EBITDA: Summation of Nuvei's and Paya's Adjusted EBITDA for the trailing twelve months[34] - Adjusted EBITDA less capital expenditures: Adjusted EBITDA minus acquisition of intangible assets and property and equipment[35] - Adjusted net income: Net income (loss) before acquisition/integration/severance costs, share-based payments, foreign currency loss/gain, amortization of acquisition-related intangible assets, and related tax impacts, plus other specific adjustments[36] Non-IFRS Financial Ratios Nuvei employs various non-IFRS financial ratios to assess performance trends and financial leverage, providing a more comparable view by adjusting for factors like foreign currency fluctuations, acquisitions, and non-operating items - Key non-IFRS financial ratios include[25][26] - Revenue growth at constant currency: Year-over-year change in Revenue at constant currency divided by prior period reported revenue[37] - Organic revenue growth at constant currency: Year-over-year change in Organic revenue at constant currency divided by comparable Organic revenue in the prior period[38] - Organic revenue growth excluding digital assets and cryptocurrencies at constant currency: Year-over-year change in Organic revenue excluding digital assets and cryptocurrencies at constant currency divided by comparable Organic revenue excluding digital assets and cryptocurrencies in the prior period[39] - Adjusted EBITDA margin: Adjusted EBITDA divided by revenue[40] - Adjusted EBITDA less capital expenditures conversion: Adjusted EBITDA less capital expenditures divided by Adjusted EBITDA[40] - Combined leverage ratio: Net debt divided by Combined trailing twelve months Adjusted EBITDA[41] - Adjusted net income per basic share and per diluted share: Adjusted net income less non-controlling interest divided by basic/diluted weighted average common shares outstanding[42] Supplementary Financial Measures Nuvei monitors key supplementary financial measures to evaluate business performance, identify trends, and inform strategic decisions, including total volume and pro forma revenue metrics - Key supplementary financial measures include[43] - Total volume: The total dollar value of transactions processed by customers under contractual agreement, indicating business performance and generally impacting revenue[44] - Organic total volume at constant currency: Total volume excluding acquired/divested businesses and adjusted for foreign currency impact, providing insight into organic growth[45] - Nuvei pro forma revenue: Nuvei's reported revenue after giving effect to the Paya acquisition as if it occurred at the beginning of the period, presented on an aggregated and channel basis[46] - Nuvei pro forma revenue growth: Nuvei reported revenue divided by Nuvei pro forma revenue in the comparative year, helping understand Paya's contribution to year-over-year revenue growth[47] Forward-Looking Information and Assumptions Forward-Looking Information This section outlines Nuvei's forward-looking statements regarding future results, performance, and market opportunities, emphasizing that such information is based on management's beliefs and assumptions and is subject to various known and unknown risks and uncertainties - Forward-looking information includes expectations for future results, performance, market opportunities, industry trends, business plans, growth strategies, and financial outlook[48] - This information is based on management's beliefs and assumptions, including foreign exchange rates, competition, political environment, and economic conditions[50] - Known and unknown risks and uncertainties could cause actual results to differ materially, including: macroeconomic factors (e.g., foreign currency, inflation, interest rates, conflicts), industry competition, challenges in growth strategy and market expansion, regulatory compliance, customer retention, managing growth, indebtedness, acquisition risks (e.g., Paya integration), reliance on SMBs and banking partners, and operational risks like fraud and data security[53][54] - Investors are cautioned against undue reliance on forward-looking information, as actual results may vary[51][55] Financial Outlook and Growth Targets Assumptions Nuvei's financial outlook and growth targets are underpinned by assumptions regarding accelerated investment in distribution, marketing, innovation, and technology, expected to normalize over time, alongside stable economic conditions and successful acquisition integration - The financial outlook reflects a strategy to accelerate investment in distribution, marketing, innovation, and technology, with these expenses expected to decrease as a percentage of revenue over time[56] - Key assumptions include[57] - Continued operating results and suitable margins in line with management's expectations[58] - Specific channel revenue growth expectations: Global commerce (20%-30%), B2B/government/ISV (20%+), and improvement in SMB (from negative mid-single digit)[58] - Effective execution of strategic growth priorities without material adverse macroeconomic impacts[58] - Economic conditions in core markets remaining close to current levels, and no material disruption from the Middle East conflict on Israeli operations[59] - Digital assets contribution expected to decline to no more than 5% of revenue[59] - Successful integration of the Paya acquisition, leading to synergies and strengthened market position[59] - Ability to retain and attract new business, cross-sell, expand customer use of solutions, and leverage sales and marketing efforts for growth[59] - Continued investment in the proprietary platform, maintenance of banking/payment network relationships, and effective management of growth and talent[59][60] Consolidated Financial Statements Statements of Profit or Loss and Comprehensive Income or Loss Data The consolidated statements of profit or loss and comprehensive income or loss provide a detailed breakdown of Nuvei's financial performance for the three months and years ended December 31, 2023 and 2022, including revenue, gross profit, operating profit, net income (loss), and earnings per share Statements of Profit or Loss and Comprehensive Income or Loss Data (in thousands of US dollars, except for shares and per share amounts) | | Three months ended Dec 31, 2023 | Three months ended Dec 31, 2022 | Years ended Dec 31, 2023 | Years ended Dec 31, 2022 | | :---------------------------------------------------- | :------------------------------ | :------------------------------ | :----------------------- | :----------------------- | | Revenue | 321,517 | 220,339 | 1,189,893 | 843,323 | | Cost of revenue | 58,734 | 50,166 | 222,906 | 171,425 | | Gross profit | 262,783 | 170,173 | 966,987 | 671,898 | | Selling, general and administrative expenses | 216,435 | 148,465 | 850,090 | 590,966 | | Operating profit | 46,348 | 21,708 | 116,897 | 80,932 | | Finance income | (234) | (7,267) | (9,283) | (13,694) | | Finance cost | 43,495 | 9,214 | 121,334 | 22,841 | | Net finance cost | 43,261 | 1,947 | 112,051 | 9,147 | | Gain on foreign currency exchange | (10,621) | 4,663 | (10,101) | (15,752) | | Income before income tax | 13,708 | 15,098 | 14,947 | 87,537 | | Income tax expense | (388) | 5,746 | 15,643 | 25,582 | | Net income (loss) | 14,096 | 9,352 | (696) | 61,955 | | Comprehensive income (loss) | 13,820 | 42,548 | (4,733) | 31,097 | | Net income (loss) per share - Basic | 0.08 | 0.06 | (0.06) | 0.40 | | Net income (loss) per share - Diluted | 0.08 | 0.06 | (0.06) | 0.39 | | Weighted average number of common shares outstanding - Basic | 139,363,673 | 140,633,277 | 139,248,530 | 141,555,788 | | Weighted average number of common shares outstanding - Diluted | 141,961,168 | 142,681,178 | 139,248,530 | 144,603,485 | Consolidated Statements of Financial Position Data The consolidated statements of financial position present Nuvei's assets, liabilities, and equity as of December 31, 2023, and 2022, highlighting significant increases in total assets, intangible assets, goodwill, and total liabilities Consolidated Statements of Financial Position Data (in thousands of US dollars) | | December 31, 2023 | December 31, 2022 | | :------------------------------------ | :------------------ | :------------------ | | Assets | | | | Cash and cash equivalents | 170,435 | 751,686 | | Segregated funds | 1,455,376 | 823,666 | | Total current assets | 1,764,306 | 1,655,871 | | Property and equipment | 33,094 | 31,881 | | Intangible assets | 1,305,048 | 694,995 | | Goodwill | 1,987,737 | 1,114,593 | | Total Assets | 5,135,267 | 3,524,669 | | Liabilities | | | | Due to merchants | 1,455,376 | 823,666 | | Total current liabilities | 1,680,683 | 978,939 | | Loans and borrowings (non-current) | 1,248,074 | 502,102 | | Total Liabilities | 3,091,052 | 1,545,179 | | Equity | | | | Total Equity | 2,044,215 | 1,979,490 | | Total Liabilities and Equity | 5,135,267 | 3,524,669 | Consolidated Statements of Cash Flow Data The consolidated statements of cash flow detail Nuvei's cash movements from operating, investing, and financing activities for the years ended December 31, 2023, and 2022, showing a net decrease in cash and cash equivalents in 2023 Consolidated Statements of Cash Flow Data (in thousands of US dollars) | Cash Flow Activity | 2023 | 2022 | | :------------------------------------ | :--------- | :--------- | | Net income (loss) | (696) | 61,955 | | Amortization of intangible assets | 121,975 | 93,009 | | Depreciation of property and equipment | 14,448 | 8,483 | | Share-based payments | 134,609 | 139,103 | | Net cash flow from operating activities | 263,005 | 267,663 | | Business acquisitions, net of cash acquired | (1,379,778) | (50,235) | | Acquisition of property and equipment | (10,200) | (13,744) | | Acquisition of intangible assets | (44,880) | (34,578) | | Net cash flow used in investing activities | (1,494,061) | (50,235) | | Proceeds from loans and borrowings | 898,548 | — | | Repayment of loans and borrowings | (127,840) | (5,120) | | Shares repurchased and cancelled | (56,042) | (166,609) | | Dividend paid to shareholders | (27,923) | — | | Net cash flow from (used in) financing activities | 649,761 | (214,298) | | Net increase (decrease) in cash and cash equivalents | (581,251) | 3,110 | | Cash and cash equivalents – Beginning of Year | 751,686 | 748,576 | | Cash and cash equivalents – End of Year | 170,435 | 751,686 | Reconciliations of Non-IFRS Measures Reconciliation of Adjusted EBITDA and Adjusted EBITDA less Capital Expenditures to Net Income (Loss) This section provides a reconciliation of Net Income (Loss) to Adjusted EBITDA and Adjusted EBITDA less capital expenditures, detailing the adjustments made for non-operational and non-cash items for both quarterly and annual periods Reconciliation of Adjusted EBITDA and Adjusted EBITDA less Capital Expenditures to Net Income (Loss) (in thousands of US dollars) | | Three months ended Dec 31, 2023 | Three months ended Dec 31, 2022 | Years ended Dec 31, 2023 | Years ended Dec 31, 2022 | | :---------------------------------------------------- | :------------------------------ | :------------------------------ | :----------------------- | :----------------------- | | Net income (loss) | 14,096 | 9,352 | (696) | 61,955 | | Finance cost | 43,495 | 9,214 | 121,334 | 22,841 | | Finance income | (234) | (7,267) | (9,283) | (13,694) | | Depreciation and amortization | 36,298 | 21,734 | 136,423 | 101,492 | | Income tax expense (recovery) | (388) | 5,746 | 15,643 | 25,582 | | Acquisition, integration and severance costs | 4,330 | 6,923 | 41,330 | 28,413 | | Share-based payments and related payroll taxes | 29,145 | 35,546 | 135,568 | 139,309 | | Loss (gain) on foreign currency exchange | (10,621) | 4,663 | (10,101) | (15,752) | | Legal settlement and other | 3,931 | (226) | 7,123 | 1,171 | | Adjusted EBITDA | 120,052 | 85,685 | 437,341 | 351,317 | | Acquisition of property and equipment, and intangible assets | (14,830) | (14,511) | (55,080) | (48,322) | | Adjusted EBITDA less capital expenditures | 105,222 | 71,174 | 382,261 | 302,995 | | Adjusted EBITDA less capital expenditures conversion | 88% | 83% | 87% | 86% | | Adjusted EBITDA margin | 37.3% | 38.9% | 36.8% | 41.7% | | Net Income margin | 4.4% | 4.2% | (0.1)% | 7.3% | Reconciliation of Combined Leverage Ratio to Combined Trailing Twelve Months Adjusted EBITDA and Net Debt This reconciliation details the calculation of the Combined leverage ratio, showing net debt relative to Combined trailing twelve months Adjusted EBITDA across several quarters, reflecting the company's financial leverage Reconciliation of Combined Leverage Ratio (in millions of US dollars, except Combined leverage ratio) | | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | | :------------------------------------ | :----------- | :----------- | :----------- | :----------- | | Trailing twelve months Adjusted EBITDA | 445.9 | 431.5 | 420.6 | 422.3 | | Total credit facilities excluding unamortized transaction costs | 1,275.0 | 1,243.5 | 1,279.7 | 1,335.0 | | Cash and cash equivalents | 170.4 | 121.0 | 118.4 | 132.8 | | Net debt | 1,104.6 | 1,122.5 | 1,161.4 | 1,202.2 | | Combined leverage ratio | 2.48x | 2.60x | 2.76x | 2.85x | Reconciliation of Paya Adjusted EBITDA to Paya Net Income This reconciliation provides the adjustments made to Paya's Net income to arrive at Paya Adjusted EBITDA for various quarters in 2022, prior to its acquisition by Nuvei Reconciliation of Paya Adjusted EBITDA to Paya Net Income (in millions of US dollars) | | Q4 2022 | Q3 2022 | Q2 2022 | | :------------------------------------ | :------ | :------ | :------ | | Paya Net income (loss) | 3.1 | 1.3 | 1.7 | | Depreciation & amortization | 7.7 | 8.4 | 7.9 | | Income tax expense | 1.9 | 1.4 | 0.9 | | Interest and other expense | 3.3 | 3.7 | 3.4 | | Paya EBITDA | 16.0 | 14.8 | 13.9 | | Transaction-related expenses | 1.2 | — | 2.5 | | Stock-based compensation | 1.6 | 2.1 | 2.0 | | Restructuring costs | 0.1 | 1.2 | 0.3 | | Discontinued service costs | 0.1 | 0.1 | 0.1 | | Contingent non-income tax liability | 0.4 | — | — | | Other costs | 0.5 | 0.4 | 0.4 | | Total adjustments | 3.9 | 3.8 | 5.3 | | Paya Adjusted EBITDA | 19.9 | 18.6 | 19.2 | Reconciliation of Adjusted Net Income and Adjusted Net Income per Share to Net Income (Loss) This reconciliation details the adjustments from Net Income (Loss) to Adjusted net income and Adjusted net income per share, accounting for items such as acquisition-related amortization, share-based payments, and other non-recurring costs for both quarterly and annual periods Reconciliation of Adjusted Net Income and Adjusted Net Income per Share to Net Income (Loss) (in thousands of US dollars, except for share and per share amounts) | | Three months ended Dec 31, 2023 | Three months ended Dec 31, 2022 | Years ended Dec 31, 2023 | Years ended Dec 31, 2022 | | :---------------------------------------------------- | :------------------------------ | :------------------------------ | :----------------------- | :----------------------- | | Net income (loss) | 14,096 | 9,352 | (696) | 61,955 | | Change in fair value of share repurchase liability | — | — | 571 | (5,710) | | Accelerated amortization of deferred financing fees | 15,094 | — | 15,094 | — | | Amortization of acquisition-related intangible assets | 26,703 | 14,957 | 101,599 | 83,861 | | Acquisition, integration and severance costs | 4,330 | 6,923 | 41,330 | 28,413 | | Share-based payments and related payroll taxes | 29,145 | 35,546 | 135,568 | 139,309 | | Loss (gain) on foreign currency exchange | (10,621) | 4,663 | (10,101) | (15,752) | | Legal settlement and other | 3,931 | (226) | 7,123 | 1,171 | | Adjustments | 68,582 | 61,863 | 291,184 | 231,292 | | Income tax expense related to adjustments | (14,049) | (3,179) | (42,552) | (19,061) | | Adjusted net income | 68,629 | 68,036 | 247,936 | 274,186 | | Net income attributable to non-controlling interest | (2,262) | (1,312) | (7,139) | (5,223) | | Adjusted net income attributable to the common shareholders of the Company | 66,367 | 66,724 | 240,797 | 268,963 | | Weighted average number of common shares outstanding - Basic | 139,363,673 | 140,633,277 | 139,248,530 | 141,555,788 | | Weighted average number of common shares outstanding - Diluted | 141,961,168 | 142,681,178 | 142,538,349 | 144,603,485 | | Adjusted net income per share attributable to common shareholders - Basic | 0.48 | 0.47 | 1.73 | 1.90 | | Adjusted net income per share attributable to common shareholders - Diluted | 0.47 | 0.47 | 1.69 | 1.86 | Reconciliation of Revenue at Constant Currency to Revenue This reconciliation adjusts reported revenue for the impact of foreign currency exchange fluctuations to present revenue at constant currency, providing a clearer view of underlying growth trends for both quarterly and annual periods Reconciliation of Revenue at Constant Currency to Revenue (in thousands of US dollars) | | Q4 2023 Revenue as reported | Q4 2023 Foreign currency exchange impact on revenue | Q4 2023 Revenue at constant currency | Q4 2022 Revenue as reported | Q4 2023 Revenue growth | Q4 2023 Revenue growth at constant currency | | :---------------------------------------------------- | :-------------------------- | :------------------------------------------ | :----------------------------------- | :-------------------------- | :--------------------- | :------------------------------------------ | | Revenue | 321,517 | (4,930) | 316,587 | 220,339 | 46% | 44% | | | FY 2023 Revenue as reported | FY 2023 Foreign currency exchange impact on revenue | FY 2023 Revenue at constant currency | FY 2022 Revenue as reported | FY 2023 Revenue growth | FY 2023 Revenue growth at constant currency | | :---------------------------------------------------- | :-------------------------- | :------------------------------------------ | :----------------------------------- | :-------------------------- | :--------------------- | :------------------------------------------ | | Revenue | 1,189,893 | (3,398) | 1,186,495 | 843,323 | 41% | 41% | Reconciliation of Organic Revenue Excluding Digital Assets and Cryptocurrencies at Constant Currency to Revenue This reconciliation adjusts reported revenue to exclude the impact of acquisitions, digital assets, cryptocurrencies, and foreign currency exchange, providing a clearer view of organic revenue growth from core operations for both quarterly and annual periods Reconciliation of Organic Revenue Excluding Digital Assets and Cryptocurrencies at Constant Currency to Revenue (in thousands of US dollars) | | Q4 2023 Revenue as reported | Q4 2023 Revenue from acquisitions | Q4 2023 Revenue from digital assets and cryptocurrencies | Q4 2023 Foreign currency exchange impact on revenue | Q4 2023 Organic revenue excluding digital assets and cryptocurrencies at constant currency | Q4 2022 Revenue as reported | Q4 2022 Revenue from digital assets and cryptocurrencies | Q4 2022 Comparable organic revenue excluding digital assets and cryptocurrencies | Q4 2023 Revenue growth | Q4 2023 Organic revenue growth excluding digital assets and cryptocurrencies at constant currency | | :---------------------------------------------------- | :-------------------------- | :------------------------------ | :----------------------------------------------------- | :------------------------------------------ | :----------------------------------------------------------------------------------- | :-------------------------- | :----------------------------------------------------- | :----------------------------------------------------------------------------------- | :--------------------- | :--------------------------------------------------------------------------------------------------- | | Revenue | 321,517 | (81,298) | (17,249) | (4,525) | 218,445 | 220,339 | (19,198) | 201,141 | 46% | 9% | | | FY 2023 Revenue as reported | FY 2023 Revenue from acquisitions | FY 2023 Revenue from digital assets and cryptocurrencies | FY 2023 Foreign currency exchange impact on revenue | FY 2023 Organic revenue excluding digital assets and cryptocurrencies at constant currency | FY 2022 Revenue as reported | FY 2022 Revenue from digital assets and cryptocurrencies | FY 2022 Comparable organic revenue excluding digital assets and cryptocurrencies | FY 2023 Revenue growth | FY 2023 Organic revenue growth excluding digital assets and cryptocurrencies at constant currency | | :---------------------------------------------------- | :-------------------------- | :------------------------------ | :----------------------------------------------------- | :------------------------------------------ | :----------------------------------------------------------------------------------- | :-------------------------- | :----------------------------------------------------- | :----------------------------------------------------------------------------------- | :--------------------- | :--------------------------------------------------------------------------------------------------- | | Revenue | 1,189,893 | (264,513) | (71,875) | (3,730) | 849,775 | 843,323 | (118,879) | 724,444 | 41% | 17% | - Revenue from acquisitions primarily reflects revenue from Paya, acquired on February 22, 2023, and another immaterial acquisition[92] Reconciliation of Organic Revenue at Constant Currency to Revenue This reconciliation adjusts reported revenue to exclude the impact of acquisitions and foreign currency exchange, providing a measure of organic revenue at constant currency for both quarterly and annual periods Reconciliation of Organic Revenue at Constant Currency to Revenue (in thousands of US dollars) | | Q4 2023 Revenue as reported | Q4 2023 Revenue from acquisitions | Q4 2023 Revenue from divestitures | Q4 2023 Foreign currency exchange impact on organic revenue | Q4 2023 Organic revenue at constant currency | Q4 2022 Revenue as reported | Q4 2022 Revenue from divestitures | Q4 2022 Comparable organic revenue | Q4 2023 Revenue growth | Q4 2023 Organic revenue growth at constant currency | | :---------------------------------------------------- | :-------------------------- | :------------------------------ | :------------------------------ | :------------------------------------------ | :----------------------------------- | :-------------------------- | :------------------------------ | :----------------------------------- | :--------------------- | :------------------------------------------ | | Revenue | 321,517 | (81,298) | — | (4,930) | 235,289 | 220,339 | — | 220,339 | 46% | 7% | | | FY 2023 Revenue as reported | FY 2023 Revenue from acquisitions | FY 2023 Revenue from divestitures | FY 2023 Foreign currency exchange impact on organic revenue | FY 2023 Organic revenue at constant currency | FY 2022 Revenue as reported | FY 2022 Revenue from divestitures | FY 2022 Comparable organic revenue | FY 2023 Revenue growth | FY 2023 Organic revenue growth at constant currency | | :---------------------------------------------------- | :-------------------------- | :------------------------------ | :------------------------------ | :------------------------------------------ | :----------------------------------- | :-------------------------- | :------------------------------ | :----------------------------------- | :--------------------- | :------------------------------------------ | | Revenue | 1,189,893 | (264,513) | — | (3,398) | 921,982 | 843,323 | — | 843,323 | 41% | 9% | - Revenue from acquisitions primarily reflects revenue from Paya, which was acquired on February 22, 2023[93] Reconciliation of Nuvei Pro Forma Revenue to Revenue This reconciliation presents Nuvei's pro forma revenue, which includes Paya's revenue as if the acquisition had occurred at the beginning of the prior period, providing a comparable view of combined revenue and growth by channel Reconciliation of Nuvei Pro Forma Revenue to Revenue (in thousands of US dollars) | | Q4 2023 Revenue as reported | Q4 2022 Nuvei revenue as reported | Q4 2022 Paya revenue as reported | Q4 2022 Adjustments | Q4 2022 Nuvei pro forma revenue | Q4 2023 Revenue growth | Q4 2023 Nuvei pro forma revenue growth | | :------------------------------------ | :-------------------------- | :-------------------------- | :----------------------- | :------------------ | :------------------------------ | :--------------------- | :-------------------------------------- | | Revenue | 321,517 | 220,339 | 72,892 | (2,273) | 290,958 | 46% | 11% | | | Q4 2023 Revenue as reported | Q4 2022 Nuvei revenue as reported | Q4 2022 Paya revenue as adjusted | Q4 2022 Nuvei pro forma revenue | Q4 2023 Revenue growth | Q4 2023 Nuvei pro forma revenue growth | | :------------------------------------ | :-------------------------- | :-------------------------- | :----------------------- | :------------------------------ | :--------------------- | :-------------------------------------- | | Global commerce | 180,837 | 161,317 | — | 161,317 | 12% | 12% | | B2B, government and independent software vendors | 58,821 | 994 | 48,507 | 49,501 | n.m. | 19% | | Small & medium sized businesses | 81,859 | 58,028 | 22,112 | 80,140 | 41% | 2% | | Revenue | 321,517 | 220,339 | 70,619 | 290,958 | 46% | 11% | - Adjustments reflect presenting Paya's revenue net of interchange fees to align with Nuvei's IFRS revenue presentation[89] Additional Revenue Disclosures Revenue by Geography This table provides a detailed breakdown of Nuvei's revenue by geographic region for the three months and years ended December 31, 2023 and 2022, showing growth across all regions Revenue by Geography (in thousands of US dollars) | Region | Q4 2023 Revenue | Q4 2022 Revenue | Q4 Change ($) | Q4 Change (%) | FY 2023 Revenue | FY 2022 Revenue | FY Change ($) | FY Change (%) | | :-------------------- | :-------------- | :-------------- | :------------ | :------------ | :-------------- | :-------------- | :------------ | :------------ | | North America | 177,491 | 89,393 | 88,098 | 99% | 642,601 | 336,563 | 306,038 | 91% | | Europe, Middle East and Africa | 125,819 | 115,896 | 9,923 | 9% | 487,802 | 465,935 | 21,867 | 5% | | Latin America | 14,532 | 12,181 | 2,351 | 19% | 51,365 | 33,105 | 18,260 | 55% | | Asia Pacific | 3,675 | 2,869 | 806 | 28% | 8,125 | 7,720 | 405 | 5% | | Total Revenue | 321,517 | 220,339 | 101,178 | 46% | 1,189,893 | 843,323 | 346,570 | 41% | Revenue by Channel This table provides a detailed breakdown of Nuvei's revenue by sales channel for the three months and years ended December 31, 2023 and 2022, illustrating the contribution and growth of Global commerce, B2B/government/ISV, and SMB segments Revenue by Channel (in thousands of US dollars) | Channel | Q4 2023 Revenue | Q4 2022 Revenue | Q4 Change ($) | Q4 Change (%) | FY 2023 Revenue | FY 2022 Revenue | FY Change ($) | FY Change (%) | | :------------------------------------ | :-------------- | :-------------- | :------------ | :------------ | :-------------- | :-------------- | :------------ | :------------ | | Global commerce | 180,837 | 161,317 | 19,520 | 12% | 692,314 | 604,489 | 87,825 | 15% | | B2B, government and independent software vendors | 58,821 | 994 | 57,827 | n.m. | 190,216 | 3,906 | 186,310 | n.m. | | Small & medium sized businesses | 81,859 | 58,028 | 23,831 | 41% | 307,363 | 234,928 | 72,435 | 31% | | Total Revenue | 321,517 | 220,339 | 101,178 | 46% | 1,189,893 | 843,323 | 346,570 | 41% | Disaggregation of Revenue and Interest Revenue This table disaggregates Nuvei's revenue into merchant transaction and processing services, other revenue, and interest revenue for the three months and years ended December 31, 2023 and 2022 Disaggregation of Revenue and Interest Revenue (in thousands of US dollars) | Revenue Type | Q4 2023 | Q4 2022 | FY 2023 | FY 2022 | | :------------------------------------ | :------ | :------ | :------ | :------ | | Merchant transaction and processing services revenue | 315,817 | 218,322 | 1,177,881 | 835,093 | | Other revenue | 2,580 | 2,017 | 8,892 | 8,230 | | Interest revenue | 3,120 | — | 3,120 | — | | Total Revenue | 321,517 | 220,339 | 1,189,893 | 843,323 | Conference Call Information Nuvei hosted a conference call on March 6, 2024, to discuss its fourth quarter financial results, with webcast and replay options available through the company's investor relations website - Nuvei hosted a conference call on Wednesday, March 6, 2024, at 8:30 am ET to discuss Q4 financial results[22] - The call featured Philip Fayer (Chair and CEO) and David Schwartz (CFO)[22] - A live webcast and replay are available on the company's investor relations website (https://investors.nuvei.com) under the 'Events & presentations' section[23]