Nayax Ltd.

Hello everyone and welcome to NIAC's second quarter earnings conference call. At this time, all participants are in listen-only mode and the conference is being recorded. After the presentation, there'll be an opportunity to ask questions. To join the question queue, you may press star then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and 0. I would now like to turn the conference over to Ms. Virginia Stewart-Gibson. Please go ahead.

Thank you, operator, and everyone for joining us today on this call. With me on the call today are Yair Nekmad, NIAC's co-founder and chief executive officer, and Sangeet Manoor, chief financial officer. Following management's prepared remarks, we will open the call for the question and answer session. Our press release and supplementary investor presentations are available on our investor relations website at ir.niacs.com. As a reminder, during this call, we will be making forward-looking statements. All forward-looking statements on our call today are based on assumptions and therefore subject to risks and uncertainties that may cause actual results to differ materially from those projected. We have no obligation to update these statements except as required by law. You can read about these risks and uncertainties in our earnings press release issued earlier today and our regulatory filing. In addition, today's call will include a discussion of non-IFRS measures. These measures should be considered as a supplement to and not as a substitute for IFRS financial measures. Reconciliations to the nearest IFRS measure can be found in our earnings press release issued earlier today. All key performance indicators are intended to evaluate our business and properly measure factors in the macroeconomic environment to guide and support our decision making. These key performance indicators may be calculated in a manner different from the industry standard. And finally, Please note that all figures in today's call will be reported in U.S. dollars unless stated otherwise. Yair will start the call with a view of the business and then provide operational and strategic highlights. Sagit will go through the details of financial results for the quarter. If not, I would like to turn the call over to NIAC's CEO, Yair Nikmad. Yair?

Thank you, Virginia, and thank you to everyone for joining us on our Q2 Earnings Conference call. First, I'd like to point out our second quarter results and how we demonstrate the continuing resilience of both our team and business model and the ability to deliver another quarter of strong revenue growth and operating results, even with the backdrop of global macro uncertainty from inflation concerns, rising interest rates, worries and fears of border recession. In the face of continuing volatility in financial markets and changing economic and political landscape, the NIACS team has remained focused on what we can control and staying committed to executing against our growth strategies. Elevating our value proposition to our global diverse customer base and strengthening our competitive position as the preferred technology provider in the global unattended commerce market. While we do not have a crystal ball to predict economic outcome, we know for a fact, as we listen to our customers, that the demand environment for technology and a comprehensive solution remains robust, with no evidence of changing sentiments. I also want to underscore and remind everyone that our comprehensive proprietary platform addresses the entire unattended commerce value chain, including a global payment infrastructure a commerce software suite, a consumer engagement platform, and integrated post devices. This ownership of the entire value chain puts Knives in durable and unique position and continue to be a key pillar of our success that allow us to endure through various market cycles for good and challenging macro environments. In Q2, revenue grew over 30% year-over-year, driven again by another record level of recurring revenue at This excellent recurring revenue growth trend delivered an increase of 47% over the same period last year, accounting for 61% of total revenue compared to 55% of total revenue in Q2 2021. Our customer loyalty, as measured by net retention rate, remained high at 132% for the quarter. reflecting the high satisfaction and confidence our diverse customers place on NIAX's end-to-end platform and solutions. These metrics are key indicators that our business remains healthy and NIAX's solution is the preferred method of paying which continues to be strongly in favor of digital over cash. Based on the secular trend that continues to provide NIAX with strong tailwinds, the world of payment continues to evolve with noticeable shift towards cashless and digitalized payments. We see the digitalized payment shift from the rise of contactless with many new payment technologies such as digital wallets coming into the market. These changes are due to both advances in secure payment technology and consumer demand for safer and more personalized payment methods. Cash flow society is truly becoming global, and the world will continue to move towards a cash flow society. This payment shift continues to be a major contributor to our near-term growth trend and will also be an important part of our long-term growth aspiration. In Q2, demand for our platform and solution remained strong as we added an additional 42,000 devices, bringing the total number of our devices to almost 600,000. and we processed 360 million transactions, an increase of 70% over the previous quarter. Consisted with past quarters, the strong growth was a combination of continued new customer additions and increased transaction process volume as we expand our footprint across the world. Our strong track record of winning clients was further evidenced in Q2 with the addition of 4,000 new customers spending multiple markets and verticals, ending the quarter with an install base of almost 38,000 customers, an increase of 58% over the prior year quarter. Let me also emphasize here the impressive growth that we continue to see in our SMB category, which account for about 74% of our install base and remains a key focus of mine. This customer category remains healthy from both a sales pipeline and backlog perspective. I would also add that our customer base is today more diverse than ever before and is another reason that our business model and financial performance continue to be resilient despite the macro uncertainty. While SMB is a larger percentage of our customer base, we are rapidly adding or expanding our reach with large enterprise customers such as Compass School, one of the world's largest contract food service companies. I will provide more detail on this later in my remarks. We are also diverse across geographies. NICE already has a global presence in key regions that can be seen in our revenue mix. For Q2 2022, 40% of our revenue was derived from Europe, 39% from North America, 11% from the rest of the world, and 10% from Australia. The U.S. market continues to be bright and offers great expansion opportunities. An example of our key wins in this market is our expansion with Compass Group. Compass Group is the world's largest contract food service company and an existing customer is its U.S. subsidiary, which manages approximately 200,000 unattended point-of-sale devices. In July, we announced our expanded relationship with Compass Group beyond the existing 50,000 post devices that NIAX managed for a longer contractual period, choosing NIAX as their preferred technology provider. Our focus of expanding into new markets and extending our reach globally has always been part of NIAX's growth plan that we have previously outlined and will remain an ongoing strategic focus. while establishing our presence in markets that are still poised for growth, such as Japan and New Zealand, as they transition to cashless and accept more digital payments. I would now like to provide an update about the ongoing global supply chain challenges. As we've continued to communicate on our earning calls, the global company shortage is still ongoing and remains a challenge. Despite the challenges, we were able to report revenue growth in the second quarter from our post devices of 14% compared to the same quarter last year and a sequential increase of 33%. This growth was driven by our ability to close orders from our previous backlog while efficiently managing the shortage to meet our mass manufacturing schedule. We still expect this dynamic to continue for the rest of the year. However, we will continue to carefully manage the situation to supply the growing backlog of orders for our products and focus on what we can control and implement necessary action as the situation evolves. Let me now provide an update on two of our strategic initiatives. First, an update on the acquisition of OTI. We successfully closed the OTI acquisition in June, and I'm delighted to welcome the OTI team It is worth repeating that this acquisition supports our long-term growth plan to gain market share in strategic growth markets and accelerate our growth drivers in attractive regions such as Japan. Additionally, I am pleased with how the integration is proceeding and the collaborative approach by the team. The page will provide some additional color later on the call about how we view the financial contribution of OTI as part of NAICS going forward. Second, an update on our U.S. listing progress. As previously disclosed, we continue to take steps to list our ordinary share on the U.S. exchange in addition to the taste. The timing and completion of our U.S. listing remain at our discretion and is still subject to factor such as the completion of the SEC registration process. As a result, we cannot provide any certainty when this process will be completed and if at all. To wrap up, we had a strong second quarter and first half of the year. While global macro concerns continue to dominate the headlines, Max has been able to execute and deliver consistent results because of our number of factors, including a global and expanding customer base, execution on the strategies that we continue to outline, and support our customers with excellent service and product enhancement. As we look ahead, we remain confident in our ability to execute against our mid-term and long-term growth aspirations. With that, I will now turn the call over to Sagit. Sagit?