EVERTEC, Inc (NYSE:EVTC) Q2 2023 Earnings Conference Call July 26, 2023 4:30 PM ET

Company Participants

Beatriz Brown-Sáenz - Investor Relations

Mac Schuessler - President and Chief Executive Officer

Joaquin Castrillo - Chief Financial Officer

Conference Call Participants

John Davis - Raymond James

Marc Feldman - William Blair

Operator

Good afternoon, everyone and welcome to EVERTEC’s Second Quarter 2023 Earnings Conference Call. Today’s conference call is being recorded. [Operator Instructions] I would now like to turn the conference over to Beatriz Brown-Sáenz of Investor Relations. Please go ahead.

Beatriz Brown-Sáenz

Thank you and good afternoon. With me today are Mac 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.evertecinc.com.

I will now hand the call over to Mac.

Mac Schuessler

Thanks, Beatriz. We provided some very exciting news on the M&A front last week and we now have encouraging news on the earnings front. As previewed last week, we delivered strong second quarter results above our expectations. Revenue for all segments exceeded our internal plan and margins were also above our expectations.

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 second quarter results, as well as an update to our expectations for the rest of the year, which include another increase to our guidance for 2023.

Beginning on Slide 4, total revenue was approximately $167 million for the first quarter, an increase of 4% compared to the second quarter of 2022. Adjusted EBITDA was approximately $74 million, a slight increase when compared with the prior year quarter. Adjusted EBITDA margin was 44.6%, above our expectations and adjusted earnings per share was $0.71, an increase of 6% from the prior year quarter’s adjusted EPS of $0.67. As a reminder, we changed our calculation of adjusted EBITDA, adjusted net income and adjusted earnings per share metrics last quarter to exclude the impact of non-cash unrealized gains and losses from foreign currency remeasurement and all variances against prior year have been compared against recasted figures considering this change. We generated operating cash flow of $126 million and we returned approximately $22 million to our shareholders through dividends and share repurchases. Additionally, our liquidity remains strong at approximately $386 million as of June 30.