Evertec, Inc.

Good afternoon, everyone, and welcome to Evertech's second quarter 2021 earnings conference call. Today's conference call is being recorded. At this time, I would like to turn the call over to William Mena of Investor Relations. Please go ahead.

Thank you, and good afternoon. With me today are Max Schuessler, our President and Chief Executive Officer, and Joaquin Castrillo, our Chief Financial Officer. Before we begin, I'd like to remind everyone that this call may contain forward-looking statements. and should be considered in conjunction with cautionary statements contained in our earnings release and the company's most recent periodic SEC report. During today's call, management will provide certain information that will constitute non-GAAP financial measures under SEC rules, such as adjusted EBITDA, adjusted net income, and adjusted earnings for common share. Reconciliations to GAAP measures and certain additional information are also included in today's earnings release and related supplemental slides which are available in the investor relations section of our company website at www.evertechinc.com. I will now hand the call over to Mac.

Thank you, and good afternoon, everyone. Thank you for joining us on our second quarter 2021 earnings call. We delivered another strong quarter of financial results as we continued to benefit from increased transactions in Puerto Rico versus last year's volumes, which were impacted by the pandemic. In Latin America, we continue to benefit from recent implementations as well as effective management of our operating expenses. Based on our Q2 results and the momentum we see heading into the second half of the year, we are again increasing our guidance for 2021. Joaquin will provide further details later in the call. Beginning on slide four, our total revenue was $149 million for the second quarter, an increase of 26% compared to Q2 of 2020. Adjusted EBITDA was $80 million, an increase of 60% as compared to the prior year. Our margin for the second quarter was approximately 54%, over 1,000 basis points higher than last year, reflecting the scalability of our business. Our adjusted earnings per share was 78 cents, an increase of 105%. We continued to generate significant operating cash flow during the quarter of $112 million, and we returned approximately $32 million to our shareholders through dividends and share repurchases. Additionally, our liquidity remained strong at $319 million as of June 30th. Moving on to our update for Puerto Rico on slide five. We saw strong volume and revenue growth in Q2, driven by the incremental inflow of federal stimulus funds and increased consumer spend versus last year, which was significantly impacted by the COVID-19 lockdown. Merchant acquiring sales volume growth was approximately 63% year over year, reflecting transaction growth of approximately 68%. Most of this growth was driven by the months of April and May, which experienced sales volume increases of approximately 118% and 69% year-over-year, respectively. Our results in Puerto Rico also benefited from continued strong growth in ATH mobile products, which delivered approximately 60% year-over-year revenue growth. I'm also pleased to report that our previously announced large printing contract which we signed in the first quarter, is fully implemented and in production. As a reminder, this is one of the largest printing contracts in Evertex history and is anticipated to benefit our business solution segment in the back half of 2021. Turning to the operating environment in Puerto Rico, as I mentioned and as you can see in our results, the combination of the reopening of the island and the incremental federal stimulus funds continue to positively impact our results. Vaccinations continue to increase, and with over 60% of the population fully vaccinated, the Puerto Rico government further reduced restrictions in early July, and the economy is mostly open today. We do continue to monitor the effects of the Delta variant, which, as has been the case in other places, has resulted in an increased number of positive cases over the past few weeks. Now turning to Latin America on slide six. As I mentioned in our last call, we continue to see varying levels of COVID-19 restrictions, vaccination levels, and reopenings from country to country. For example, vaccine distributions began in late February in Brazil, Colombia, Chile, and Mexico. However, infection rates still remain relatively high in these countries, so we remain cautious with respect to our outlook for recovery throughout the region. Nevertheless, we are pleased to have delivered another quarter of strong double-digit revenue growth in Latin America. Our performance continues to be driven primarily by the implementation and go-live of the major wins and expanded relationships we discussed throughout last year, including Banco Popular of Costa Rica, Mercado Libre Mexico, and Santander, Chile, as well as our regional expansion of Place de Veo. In summary, we delivered strong second quarter results, and we are again raising our 2021 outlook. While we will continue to monitor the impacts of COVID-19 across our geographic footprint and remain cautious in certain countries, Underlying demand for our solutions is robust, and we continue to execute well against our growth plan. Our cash flow generation and balance sheet remain very strong, enabling us to continue executing on our capital deployment strategy. I will now hand the call over to Joaquin to review our results and guidance in more detail.