Evertec, Inc.

Good afternoon, everyone, and welcome to Evertech's first quarter 2022 earnings conference call. Today's conference call is being recorded, and at this time, I would now like to turn the conference over to Kevin Hunt 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 would 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 per 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'll now hand over the call to Max. Thanks, Kevin, and good afternoon, everyone.

We achieved strong results in the first quarter, driven by payment volume growth in both Puerto Rico and Lantana. We also continue to make progress towards closing the popular transaction and the BBR acquisition, both announced on our last earnings call On today's call, I will start with some highlights from the quarter, and then we'll turn it over to Joaquin, who will provide further details on our first quarter results, as well as an update to our expectations for the rest of the year, which includes an increase in our guidance for 2022. Beginning on slide four, total revenue was $150 million for the first quarter, an increase of 8% compared to the first quarter of 2021. Adjusted EBITDA was $75 million, an increase of 9%, and adjusted earnings per share was 70 cents, an increase of 13% from the prior year quarter. We generated significant operating cash flow of $70 million, and we returned approximately $25 million to our shareholders through dividends and the execution of share repurchases. Additionally, our liquidity remained strong at $403 million as of March 31st. Moving on to our Puerto Rico update on slide five. We experienced strong transactional growth, and this drove a 14% increase in overall sales volume in merchant acquirements. We benefited from a full quarter contribution of First Bank's merchant portfolio this year, compared to a month last year. Recall that we expanded and extended our relationship with First Bank a year ago, after their consolidation was ended there. In Payments Puerto Rico, we continued to benefit from our digital payment channels, ATH Mobile and ATH Business, as well as a 9% increase in POS transactions process. Our business solutions segment benefited from the printing deal signed a year ago that began generating revenues in the second half of the year. Finally, the quarter also benefited from the 5% CPI clause in our current MSA with Popular, which positively impacted both our business solutions segment and, to a lesser extent, and payments Puerto Rico segments. As a part of the Popular transaction, we have agreed to provide Popular with a 5% credit on services provided through the closing date. Joaquin will provide more details around that in a few minutes. We are also pleased to announce that we will be launching our Place to Pay platform in Puerto Rico during the second quarter. Place to Pay will replace our existing payment gateway in Puerto Rico with a better product offering That includes enhanced functionality for clients in the small and medium business sector, looking to accept electronic payments, including the acceptance of ATH. We believe the introduction of this gateway in our main market will put us in a much better position to capitalize on the growth of e-commerce in Puerto Rico and continue to drive growth in our payment segment. Finally, a few comments on the macro environment in Puerto Rico. The labor participation rate has continued to climb in 2022. To 44.5%, the highest rate since 2009. The overall economic activity index was up 3.5% year-over-year in the month of February, reaching the highest level since 2016. And finally, travel and tourism continue to recover with airline passengers and hotel guests all either approaching or surpassing pre-COVID levels. We will continue to execute on our strategic objectives to take advantage of this stronger Puerto Rican economy. Turning now to Latin America on Flight 6. We achieved another strong quarter with lifetime revenue up 15% compared to the prior year, reflecting organic growth, including the contribution from the wins we have announced in the past year. We recently celebrated the one-year anniversary of the GetNet Chile relationship, for which over 60,000 merchants have been affiliated. And I am pleased to announce that the GetNet relationship in Uruguay, which we announced last quarter, is already in a pilot with the first transaction occurring in a friends and family phase. Next, let's turn to slide seven to cover a few additional items. We continue to expect a mid-year close for the popular transaction announced last quarter as teams on both sides are working diligently. As for the BBR acquisition, we are waiting on regulatory approval and continue to expect closing around mid-year. which will allow us to reflect benefits from the acquisition in the second half of the year. Before I turn it over to Joaquin, I want to emphasize that our values are what drive us at Evertech. So I'd like to take a moment to highlight our continued commitment to a high quality, diverse workforce. We are incredibly proud that for the fourth year in a row, we have been named to Bloomberg's Gender Equality Index, placing us among the leading global companies who value and demonstrate this commitment. I would also like to bring to your attention the new ESG section of our website, launched earlier this month, which articulates how our values are embedded in everything we do. With that, I will now turn it over to Joaquin to provide a more in-depth look at our first quarter results.