Usio(US:USIO)2022-03-18 18:57Financial Data and Key Metrics Changes - For Q4 2021, revenues reached a record $17.4 million, an 86% increase from $9.4 million in the same period last year, with organic growth at 65% [9][33] - Total dollars processed in Q4 was $2.9 billion, up 215% year-over-year, with total transactions at 11.3 million, both achieving new quarterly records [9][10] - For the full year, revenues were $62 million, a 92% increase, with adjusted EBITDA of $4 million, an improvement of nearly $5 million from fiscal 2020 [9][37] Business Line Data and Key Metrics Changes - ACH revenues in Q4 were up 93% year-over-year, with electronic transaction volume up 108% and electronic check dollars processed up 271% [11] - The PayFac business saw a 106% increase in revenues for Q4, contributing to a total card processing volume of over $1 billion for the first time [12][26] - Prepaid revenues increased by 151% in Q4, driven by a 205% increase in transaction volume and total dollars loaded on prepaid cards exceeding $65 million [13][20] Market Data and Key Metrics Changes - The company experienced significant growth in the cryptocurrency market, which positively impacted ACH volumes and revenues [11][12] - The prepaid segment is expanding with new programs, including guaranteed income initiatives, which are expected to drive further growth [21][22] Company Strategy and Development Direction - The company aims to build strong relationships and leverage a multichannel distribution strategy to serve diverse end markets, enhancing its competitive advantage [10][11] - Focus on expanding into industries with nondiscretionary spending and recurring revenue, particularly in the prepaid and PayFac sectors [11][12] - The company is investing in infrastructure and human capital to support anticipated growth while maintaining low customer acquisition costs [16][17] Management's Comments on Operating Environment and Future Outlook - Management expects continued strong growth in 2022, projecting revenue growth of 18% to 20%, driven by the prepaid and PayFac segments [17][18] - The company has a solid cash position of over $7.2 million and no significant debt, providing a strong foundation for growth initiatives [17][37] - Management highlighted the importance of the Voyager Digital program, which is anticipated to significantly contribute to revenue in the second half of 2022 [24][56] Other Important Information - The company reported a positive adjusted EBITDA margin of 7.2% for Q4, marking the fifth consecutive quarter of positive adjusted EBITDA [36] - The company is actively enhancing its technology and infrastructure to support growth and improve service delivery [31] Q&A Session Summary Question: Increase in SG&A expenses - Management indicated that the increase is primarily due to expanding call center operations and gearing up for the Voyager Digital program, along with adding sales staff [42][43] Question: Revenue growth guidance - Management stated that all business lines are performing well, with Prepaid and PayFac expected to be the fastest-growing segments [44] Question: Stock buyback activity - The Board is reviewing potential stock buyback activity, especially in light of positive free cash flow expectations for the year [45][46] Question: ISV count and market targeting - The company signed 26 new ISV agreements in 2021, with a focus on diversifying into new vertical markets [48][49] Question: Voyager program impact on P&L - Revenue from the Voyager program is not expected in Q1, but substantial activity is anticipated in the second half of the year [55] Question: Guaranteed income programs profitability - Management noted that larger guaranteed income programs are more efficient to operate, leading to better profitability compared to smaller incentive programs [65][66]