Paya Holdings Inc.

Good morning, ladies and gentlemen, and welcome to the Pi Media Holdings, Inc. First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. If anyone should require assistance, please press star and then zero on your telephone. A question-answer session will follow the formal presentation. As a reminder, this conference call is being recorded. I would now like to turn the conference over to Mr. Matt Humphreys. Head of Investor Relations at Paya. You may begin.

Good morning, and welcome to the Paya First Quarter 2021 Earnings Conference Call. Before we begin, let me remind everyone that today's discussion will contain forward-looking statements based on our current assumptions, expectations, and beliefs, including financial guidance, the growth of Paya's business, our objectives and business strategies, as well as other forward-looking statements. Please refer to the disclosure at the end of the company's earnings press release in Form 8K filed with the SEC today for information about forward-looking statements that will be made or discussed on this call. All statements made today reflect our current expectations only, and we undertake no obligation to update any statements to reflect the events that will occur after this call. You can learn more about the specific risk factors that could cause our actual results to differ materially from today's discussion in the Risk Factors section of the company's Form 10K filed with the SEC on March 8, 2021 and in subsequent periodic reports that the company files with the SEC. Also during the call, we will discuss certain non-GAAP measures of our performance. GAAP to non-GAAP financial reconciliations and supplemental financial information are provided in the earnings press release in the 8K filed with the SEC. This call is also available via webcast. You can find all the information I have just described in the investor relations section of PIA's website. Please note we posted a supplemental first quarter 2021 presentation to the investor relations section of the PIA website. Joining us on the call today are PIA CEO Jeff Hack and CFO Glenn Renzulli. Following their prepared remarks, we will open the call to your questions. With that, let me turn the call over to Jeff.

Thank you, Matt, and good morning, everyone. Thank you for joining us today as we discuss our first quarter 2021 financial results and our recently announced acquisition of Paragon Payment Solutions. The Paragon acquisition marks our fourth acquisition, which follows our playbook of executing strategic M&A of integrated payment providers in attractive verticals, serving as a powerful complement to our organic growth strategy. Let's begin with a discussion on the Paragon transaction, and then we'll turn to our quarterly results. Paragon is a growing integrated payment solution provider based in Tempe, Arizona, that focuses primarily on serving the unique needs of the nonprofit and healthcare verticals. Paragon brings to PIA some terrific partners and unique capabilities that complement PIA's existing solutions in these verticals. Annual payment volume is approximately $1.5 billion, and importantly, Paragon has been one of PIA's distribution partners since 2011. Similar to PIA, Paragon has a robust omni-channel offering, a partner-centric distribution model, a payment agnostic platform, including ACH, and a high card-not-present mix, which makes this a highly additive acquisition. Given our longstanding relationship, we have a very solid understanding of Paragon's business model, capabilities, talent, and culture. The nonprofit and healthcare verticals Paragon primarily serves are very attractive to Paya, as they are still highly underpenetrated from an integrated payments perspective and continue to grow at a double-digit annual rate. With an attractive roster of growing ISV partners, the acquisition will expand PIA's existing ISV partnership base, providing additional opportunities to drive penetration rates higher and continue to elevate the PIA brand within these verticals. All told, the acquisition of Paragon allows us to further expand and strengthen our strong positioning capabilities in these key verticals while positioning us to deliver future growth. Going forward, as we have in past transactions, we're focused on reinvesting the highly visible synergies back into sales and marketing, which will accelerate the growth at Paragon and allow the business to naturally scale while delivering accretive returns. Len will cover the financial details shortly, but suffice to say, we're excited about this transaction and will look to leverage Paya's existing infrastructure and capabilities to accelerate Paragon's growth. Our integration efforts are well underway and we're making solid progress, despite closing the transaction a few short weeks ago. At the same time, our pipeline for accretive near-term strategic deals remains strong. Combining this actionable pipeline with the successful capital raise we completed on March 22nd, we have the flexibility and the capacity to accomplish additional strategic M&A to further accelerate our growth strategy. Now, let's review PIA's strong first quarter results. Payment volume grew 24 percent in the first quarter to $9.5 billion, led by 62 percent volume growth in our proprietary ACH solution and 6 percent growth in card volume, even with one less business day in the period versus 2020. We saw notable strength in key verticals led by B2B and government. Total revenue grew 12.4 percent to $55.3 million, primarily driven by strong ACH growth and solid momentum in our integrated card business. Adjusted EBITDA grew 40 percent to 14.8 million, while adjusted EBITDA margins expanded 520 basis points year-over-year to 26.8 percent. It is worth noting that the year-over-year growth rates are even more impressive given that Q1 2020 was a strong quarter with minimal pandemic-related impacts. Now I want to share with you some of our recent product innovation that highlights the focus we have on delivering value-added services to our partners and clients. As Sage's U.S. preferred payments partner, we released advanced new features that enhance the Sage 100 and Sage Intacct solutions, supporting both card-present and card-not-present transactions that increase user productivity while deepening our integration into Sage's software suite. Specifically, we introduced new enhanced customer portals and e-invoicing capabilities for Sage 100 users, allowing for further automation of the collection and reconciliation process for CAR ECH payments. We also delivered turnkey EMV capabilities via Paia's Cloud EMV solution to Sage Intacct users, which reduces hardware setup and compliance complexity. We take great pride in our approach to delivering tailored solutions to our partners. And as such, we also delivered a new merchant boarding solution this quarter. The solution offers boarding optionality, giving our partners enhanced flexibility in how they want to engage with their customers. By offering a more streamlined and efficient experience, our partners can accelerate their speed in monetizing payments while also delivering a higher level of satisfaction for the end user. And finally, we went live with our new modern citizen-facing municipal portal, featuring an intuitive UI and enhanced tools and features built off our flagship Piya Connect solution. This continued innovation and focus on customer experience continues to be a hallmark of our approach at Piya and serves to differentiate ourselves in the market. While these new features and improvements are vital in driving adoption and deepening penetration, our go-to-market efforts remain essential to deliver return on these investments. Recently, we launched and scaled numerous engagement campaigns with some of our key partners as we focus on accelerating penetration levels within our partners' customer base. In just the first month of one of these campaigns with a select nonprofit partner, we saw a threefold increase in the number of new clients signed. We've also dedicated additional resources to co-marketing with newer partners, focusing on accelerating partner production. And finally, in our government vertical, we had some noteworthy wins against long-established and well-known incumbents that are currently in various stages of implementation. These actions and recent wins will lay the foundation for continued growth over the next few years while further deepening our integration within our partners' software suites. With that, I'll turn it over to Glenn to walk you through the financials in more detail, as well as cover our outlook for 2021. Glenn?