Paysafe (US:PSFE)2023-03-15 20:38Financial Performance - Net cash flows provided by operating activities increased by $699,610 to $924,078 for the year ended December 31, 2022, from $224,468 in 2021 [497]. - For the year ended December 31, 2022, the net cash flows provided by operating activities were $924,078, primarily consisting of a net loss of $1,862,284 adjusted for non-cash items of $2,112,202 [498]. - Net cash used in investing activities increased by $164,325 to $575,594 for the year ended December 31, 2022, primarily due to a net cash outflow on acquisition of subsidiaries of $424,722 [500]. - Net cash used in financing activities changed to an outflow of $80,542 for the year ended December 31, 2022, from an inflow of $483,281 for the year ended December 31, 2021 [501]. - Cash outflows in working capital for the year ended December 31, 2022, amounted to $674,160, mainly related to movements in funds payable and amounts due to customers [498]. Borrowings and Liquidity - The total principal amount of external borrowings as of December 31, 2022, was $2,658,023, compared to $2,794,108 in 2021 [476]. - The Company had $283,592 available under its $305,000 Revolving Credit Facility as of December 31, 2022 [479]. - The company recorded borrowings of $917,269 and repayments of $920,519 for all facilities for the year ended December 31, 2022 [501]. - The company believes its current level of cash and borrowing capacity will be sufficient to meet operational needs and planned requirements for the foreseeable future [502]. - The Company is required to maintain minimum levels of liquidity within its regulated businesses in the UK and Ireland [478]. Acquisitions and Impairments - The cash consideration for the Pi Jersey acquisition was $2,448,799, with debt repayment of $1,155,743 and transaction costs of $151,722 [480]. - Goodwill impairment expense recognized during the year ended December 31, 2022, was $1,882,187 within the Merchant Solutions and Digital Wallets segments [522]. - Intangible asset impairments recognized for the years ended December 31, 2022, and 2021, were $5,036 and $324,145, respectively [527]. - The company has contingent consideration payables associated with several historical acquisitions, which are remeasured each reporting period based on financial performance targets [506]. Interest Rate and Currency Risk - As of December 31, 2022, a 100 basis point increase in interest rates would result in a $17.4 million unfavorable impact on net loss, while a decrease of 100 basis points would result in a $17.4 million favorable impact on net earnings related to the Company's borrowings [463]. - The Company actively manages interest rate risk through interest rate swaps and caps, converting floating rates to fixed [462]. - An increase of 1% in the U.S. dollar against other currencies would decrease net assets by $2.5 million as of December 31, 2022 [467]. Cash and Cash Equivalents - The Company had $260,219 in cash and cash equivalents as of December 31, 2022, down from $313,439 in 2021 [479]. - As of December 31, 2022, customer accounts and other restricted cash amounted to $1,866,976, an increase from $1,658,279 in 2021 [497]. Accounting and Reporting - Recently issued accounting pronouncements relevant to operations are outlined in Note 1 of the financial statements [530]. - The estimated fair value of the US Acquiring, IES, and Digital Wallet reporting units exceeded their carrying values by 3%, 9%, and 3%, respectively, as of the latest annual goodwill impairment test date [523].