Exceeds Third Quarter Financial Expectations
and Raises Guidance for Full Year 2021
Accelerates International Footprint with
Acquisition of iController
BTRS Holdings Inc. ("Billtrust" or "the Company") (NASDAQ:
BTRS), a B2B accounts receivable automation and integrated payments
leader, today announced financial results for its third quarter
ended September 30, 2021.
"We are excited to announce another great quarter, led by 22%
year-over-year software and payments segment revenue growth that
exceeded our internal expectations," said Flint Lane, Founder and
CEO of Billtrust. “Our strong results continue to be driven by
outperformance in our core software and payments segment and the
favorable secular trend of accounts receivable digitization.”
Financial Highlights for the Third Quarter Ended September
30, 2021, as Compared to the Same Period in 2020
GAAP Metrics
- Total revenue increased 8.0% year-over-year to $41.4 million,
versus $38.3 million for the same period in 2020.
- Software and payments segment revenue increased 21.5%
year-over-year to $26.0 million, compared to $21.4 million for the
same period in 2020.
- Gross profit, excluding depreciation and amortization,
increased 15.5% year-over-year to $23.4 million, compared to $20.2
million for the same period in 2020.
- Gross margin excluding depreciation and amortization expanded
by 366 basis points to 56.5%, versus 52.8% for the same period in
2020, driven by improved operating leverage and an increasing mix
of software and payments segment revenue.
- Net loss and comprehensive loss was $(11.2) million, compared
to $(2.7) million for the same period in 2020.
Non-GAAP and Key Operating Metrics
- Total Payment Volume (“TPV”), the dollar value of customer
payment transactions that Billtrust processes on its platform
during a particular period, increased by 41% year-over-year to
$21.0 billion, up from $14.9 billion for the same period in
2020.
- Net revenue* increased 13.6% year-over-year to $32.7 million,
up from $28.8 million for the same period in 2020.
- Adjusted gross profit* increased 17.2% year-over-year to $23.8
million, compared to $20.3 million for the same period in
2020.
- Adjusted gross margin* expanded by 222 basis points to 72.7%,
versus 70.5% for the same period in 2020.
- Adjusted EBITDA* was $(4.0) million, compared to positive $1.2
million for the same period in 2020, due to higher operating
expenses from increased investments in sales, marketing, research
and development, and increased public company costs.
Recent Business Highlights
- Established a strategic European presence via the acquisition
of iController, a leading B2B provider of intelligent solutions for
collections management, in early October.
- Card payments were a key driver of strong Q3 results: direct
card revenue* from card payments on our electronic payment
processing platforms grew 77% year-over-year in the third quarter
of 2021 to $4.2 million.
- Business Payments Network (BPN) shows continued strong growth
(TPV growth of 102% year-over-year) and strategic progress, and we
have now signed 4 of the top 5 U.S. bank issuers as BPN processing
partners.
Full Year 2021 Outlook
Billtrust is providing the following updated financial guidance
for the full year 2021, as compared to the guidance ranges
previously provided in August 2021:
- Total revenue unchanged in a range between $163 million to $167
million, including reimbursable costs revenue of $34 million to $36
million, down from a previous estimate of reimbursable costs
revenue of $37 million.
- Net revenue* between $129 million to $131 million, which at the
midpoint of $130 million represents annual growth of approximately
20%, up from a previous range of $126 million to $130 million.
- Adjusted gross profit* between $93 million to $95 million, up
from a previous range of $88 million to $92 million.
- Adjusted gross margin* between 71.5% to 72.5%, up from a
previous range of 70% to 71%.
- Adjusted EBITDA* between $(14) million to $(16) million,
including additional public company costs, consistent with the
previous guidance range.
* Net revenue, adjusted gross profit, adjusted gross margin,
adjusted EBITDA, and direct card revenue are non-GAAP measures. An
explanation of these measures and how they are calculated can be
found under the heading “Non-GAAP Financial Measures” in the
Company's Quarterly Report on Form 10-Q or in the attached
reconciliations. Reconciliations of these non-GAAP measures to the
most directly comparable GAAP financial measures are included in
the tables at the end of this press release. With respect to the
Company's expectations under "Full Year 2021 Outlook" above,
reconciliation of non-GAAP adjusted gross profit and adjusted gross
margin to the comparable GAAP measure, or non-GAAP adjusted EBITDA
to net loss and comprehensive loss is not available without
unreasonable efforts on a forward-looking basis due to the high
variability, complexity and low visibility with respect to certain
items excluded from non-GAAP adjusted gross profit and non-GAAP
adjusted EBITDA, such as charges related to stock-based
compensation expenses, the change in fair value of contingent
consideration related to an acquisition and related tax effects,
including non-recurring income tax adjustments.
Conference Call
The Company will host a conference call to discuss third quarter
2021 financial results today at 5:00 pm ET. Hosting the call will
be Flint Lane, Founder and Chief Executive Officer, and Mark
Shifke, Chief Financial Officer. The conference call will be
webcast live from the investor relations portion of the Company’s
website at https://investors.billtrust.com. The conference call can
also be accessed live over the phone by dialing 877-407-3982 (toll
free) or 201-493-6780 (international). A replay will be available
approximately one hour after the call has concluded and can be
accessed by dialing 844-512-2921 (toll free) or 412-317-6671
(international); the conference ID is 13724066. The replay will be
available through Wednesday November 24, 2021.
About Billtrust
Billtrust (NASDAQ: BTRS) is a leading provider of cloud-based
software and integrated payment processing solutions that simplify
and automate B2B commerce. Accounts receivable is broken and relies
on conventional processes that are outdated, inefficient, manual
and largely paper based. Billtrust is at the forefront of the
digital transformation of accounts receivable, providing
mission-critical solutions that span credit decisioning and
monitoring, online ordering, invoice delivery, payments and
remittance capture, cash application and collections. For more
information, visit Billtrust.com.
Forward-Looking Statements
This press release includes “forward-looking statements” within
the meaning of the “safe harbor” provisions of the United States
Private Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by the use of words such as
“estimate,” “plan,” “project,” “forecast,” “intend,” “will,”
“expect,” “anticipate,” “believe,” “seek,” “target,” “guidance,”
"outlook" or other similar expressions that predict or indicate
future events or trends or that are not statements of historical
matters. These forward-looking statements include, but are not
limited to, statements regarding Billtrust’s financial guidance and
estimates and forecasts of Billtrust’s financial and performance
metrics, the potential benefits, value and the commercial
attractiveness to its customers of Billtrust’s products and
services, Billtrust’s opportunity and ability to grow and scale its
business, and Billtrust’s technology platform. These statements are
based on various assumptions, whether or not identified in this
press release, and on the current expectations of Billtrust’s
management and are not predictions of actual performance. These
forward-looking statements are provided for illustrative purposes
only and are not intended to serve as, and must not be relied on by
any investor as, a guarantee, an assurance, a prediction or a
definitive statement of fact or probability. Actual events and
circumstances are difficult or impossible to predict and may differ
from assumptions. Many actual events and circumstances are beyond
the control of Billtrust. These forward-looking statements are
subject to a number of risks and uncertainties, including
Billtrust’s ability to attract and retain customers and expand
customers’ use of Billtrust’s services; market, financial,
political and legal conditions; the impact of the COVID-19 pandemic
on Billtrust’s business and the global economy; risks relating to
the uncertainty of the projected financial and operating
information with respect to Billtrust; risks related to future
market adoption of Billtrust's offerings; risks related to
Billtrust's marketing and growth strategies; risks related to
expanding Billtrust's operations outside the United States; risks
related to Billtrust's ability to acquire or invest in businesses,
products, or technologies that may complement or expand its
products or platforms, enhance its technical capabilities, or
otherwise offer growth opportunities; the effects of competition on
Billtrust’s future business; and the risks discussed in Billtrust’s
Registration Statement on Form S-1 filed on June 28, 2021, under
the heading “Risk Factors” and other documents of Billtrust filed,
or to be filed, with the Securities and Exchange Commission
(“SEC”). If any of these risks materialize or any of Billtrust’s
assumptions prove incorrect, actual results could differ materially
from the results implied by these forward-looking statements. There
may be additional risks that Billtrust presently does not know of
or that Billtrust currently believes are immaterial that could also
cause actual results to differ from those contained in the
forward-looking statements. In addition, forward-looking statements
reflect Billtrust’s expectations, plans or forecasts of future
events and views as of the date of this press release. Billtrust
anticipates that subsequent events and developments will cause
Billtrust’s assessments to change. However, while Billtrust may
elect to update these forward-looking statements at some point in
the future, Billtrust specifically disclaims any obligation to do
so. These forward-looking statements should not be relied upon as
representing Billtrust’s assessments as of any date subsequent to
the date of this press release. Accordingly, undue reliance should
not be placed upon the forward-looking statements.
Non-GAAP Financial Measures
Some of the financial information contained in this press
release has not been prepared in accordance with generally accepted
accounting principles in the United States (“GAAP”). Such financial
information is identified as such within the press release.
Billtrust believes that the use of these non-GAAP financial
measures provides an additional tool for management and investors
to use in evaluating Billtrust’s actual and projected financial
condition and operating results and trends in and in comparing
Billtrust’s financial measures with other similar companies, many
of which present similar non-GAAP financial measures to investors.
Billtrust does not consider these non-GAAP measures in isolation or
as an alternative to financial measures determined in accordance
with GAAP. The principal limitation of these non-GAAP financial
measures is that they exclude significant expenses and other
amounts that are required by GAAP to be recorded in Billtrust’s
financial statements. In addition, they are subject to inherent
limitations as they reflect the exercise of judgments by management
about which expense and other amounts are excluded or included in
determining these non-GAAP financial measures. In order to
compensate for these limitations, Billtrust presents non-GAAP
financial measures in connection with GAAP results. Billtrust is
not providing a reconciliation of its projected non-GAAP adjusted
gross profit, non-GAAP adjusted gross margin and non-GAAP adjusted
EBITDA for 2021 to the most directly comparable measure prepared in
accordance with GAAP because certain items excluded from non-GAAP
adjusted gross profit and non-GAAP adjusted EBITDA, such as charges
related to stock-based compensation expenses, the change in fair
value of contingent consideration related to an acquisition and
related tax effects, including non-recurring income tax
adjustments, cannot be reasonably calculated or predicted at this
time. You should review Billtrust’s audited financial statements in
the Registration Statement on Form S-1 filed on June 28, 2021, and
unaudited interim reports and the other financial information
included in other documents of Billtrust filed, or to be filed,
with the SEC.
Net revenue (non-GAAP) is defined as total revenues, less
reimbursable costs revenue.
Adjusted gross profit is defined as total revenues, less total
cost of revenues excluding depreciation and amortization, plus
stock based compensation expense included in total cost of
revenues.
Adjusted gross margin is defined as adjusted gross profit
divided by total revenues less reimbursable costs revenue or net
revenue (non-GAAP).
Adjusted EBITDA is defined as net loss and comprehensive loss,
plus (i) provision/benefit for income taxes, (ii) change in fair
value of financial instruments and other income (expense), (iii)
interest expense and loss on extinguishment of debt, (iv)
depreciation and amortization, (v) stock-based compensation
expense, (vi) restructuring and severance costs, (vii) acquisition
and integration costs, (viii) other capital structure transaction
costs, (ix) minus interest income.
Direct card revenue (DCR) is defined as variable transactional
revenue associated with card payments on our platforms and related
fees. Direct card revenue is a subset of software and payments
segment revenue.
Condensed Consolidated
Statements of Operations (Unaudited)
Three Months Ended September
30,
2021
2020
Revenues:
(in thousands)
Subscription, transaction, and
services
$
32,732
$
28,808
Reimbursable costs
8,625
9,486
Total revenues
41,357
38,294
Cost of revenues:
Cost of subscription, transaction, and
services
9,368
8,577
Cost of reimbursable costs
8,625
9,486
Total cost of revenues, excluding
depreciation and amortization
17,993
18,063
Operating expenses:
Research and development
13,453
9,098
Sales and marketing
10,310
5,745
General and administrative
9,838
5,106
Depreciation and amortization
1,205
1,402
Total operating expenses
34,806
21,351
Loss from operations
(11,442)
(1,120)
Other income (expense):
Interest income
115
1
Interest expense and loss on
extinguishment of debt
(2)
(1,120)
Change in fair value of financial
instruments and other income (expense)
162
(443)
Total other income (expense)
275
(1,562)
Loss before income taxes
(11,167)
(2,682)
Provision for income taxes
(27)
(33)
Net loss and comprehensive loss
$
(11,194)
$
(2,715)
Net loss per common share, basic and
diluted
$
(0.07)
$
(0.03)
Weighted average common shares
outstanding, basic and diluted
158,316
99,948
Selected Segment Information
(Unaudited)
Three Months Ended September
30,
Print
Software and Payments
All other
Consolidated
(in thousands)
2021
Revenues:
Subscription and transaction
$
4,367
$
26,009
$
—
$
30,376
Services and other
—
—
2,356
2,356
Subscription, transaction, and
services
4,367
26,009
2,356
32,732
Reimbursable costs
8,625
—
—
8,625
Total revenues
$
12,992
$
26,009
$
2,356
$
41,357
2020
Revenues:
Subscription and transaction
$
4,724
$
21,406
$
—
$
26,130
Services and other
—
—
2,678
2,678
Subscription, transaction, and
services
4,724
21,406
2,678
28,808
Reimbursable costs
9,486
—
—
9,486
Total revenues
$
14,210
$
21,406
$
2,678
$
38,294
Condensed Consolidated
Statements of Cash Flows (Unaudited)
Three Months Ended September
30,
2021
2020
(in thousands)
Cash flows from operating activities:
Net loss
$
(11,194)
$
(2,715)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
1,206
1,402
Provision for bad debts
29
21
Loss on extinguishment of debt and
amortization of debt discount
—
55
Stock-based compensation expense
5,914
826
Change in fair value of financial
instruments and other income
11
448
Deferred income taxes
14
33
Changes in assets and liabilities:
Accounts receivable
(485)
(406)
Prepaid expenses
75
778
Deferred implementation, commissions, and
other costs
(9)
166
Other assets (current and non-current)
(579)
(423)
Accounts payable
361
49
Accrued expenses and other
6,063
5,799
Deferred revenue
(183)
(2,373)
Other liabilities (current and
non-current)
(211)
(263)
Net cash provided by (used in)
operating activities
$
1,012
$
3,397
Cash flows from investing activities:
Purchases of marketable securities
(40)
—
Purchases of property and equipment
(450)
(196)
Net cash used in investing
activities
(490)
(196)
Cash flows from financing activities:
Proceeds from borrowings, net of costs
—
2,987
Payments on borrowings
—
(3,112)
Payments on capital lease obligations
(52)
(69)
Proceeds from common stock issued
1,467
48
Taxes paid on net share issuance of
stock-based compensation
(96)
—
Change in customer funds payable
(5,330)
1,928
Net cash provided by (used in)
financing activities
(4,011)
1,782
Net increase in cash, cash equivalents,
and restricted cash
$
(3,489)
$
4,983
Cash, cash equivalents, and restricted
cash, beginning of period
268,821
31,166
Cash, cash equivalents, and restricted
cash, end of period
$
265,332
$
36,149
Summary of cash, cash equivalents, and
restricted cash, end of period:
Cash and cash equivalents
$
243,448
$
10,219
Customer funds
19,288
22,654
Restricted cash (included in other current
assets)
2,596
3,276
Total cash, cash equivalents, and
restricted cash
$
265,332
$
36,149
Reconciliation of GAAP to
Non-GAAP Financial Information (Unaudited)
Three Months Ended September
30,
Increase (decrease)
2021
2020
(in thousands)
Total revenues
$
41,357
$
38,294
8.0%
Less: Reimbursable costs revenue
8,625
9,486
Net revenue (non-GAAP)
$
32,732
$
28,808
13.6%
Total revenues
$
41,357
$
38,294
Less: Cost of revenue, excluding
depreciation and amortization
17,993
18,063
Gross profit, excluding depreciation
and amortization
23,364
20,231
15.5%
Add: Stock based compensation expense
436
77
Adjusted gross profit
(non-GAAP)
$
23,800
$
20,308
17.2%
Gross margin, excluding depreciation
and amortization
56.5
%
52.8
%
Adjusted gross margin
(non-GAAP)
72.7
%
70.5
%
Reconciliation of GAAP to
Non-GAAP Financial Information (Unaudited)
Three Months Ended September
30,
2021
2020
(in thousands)
Net loss and comprehensive loss
$
(11,194)
$
(2,715)
Provision for income taxes
27
33
Change in fair value and other (income)
expense, net
(162)
443
Interest expense and loss on
extinguishment of debt
2
1,120
Interest income
(115)
(1)
Depreciation and amortization
1,205
1,402
Stock-based compensation expense
5,914
826
Restructuring and severance
35
77
Acquisition and integration expenses
257
26
Other capital structure transaction
costs
—
—
Adjusted EBITDA (non-GAAP)
$
(4,031)
$
1,211
Outlook (Mid-point) for Full
Year 2021
(in thousands)
Total
Total revenues
$
165,000
Less: Reimbursable costs revenue
35,000
Net revenue (non-GAAP)
$
130,000
Reconciliation of GAAP to
Non-GAAP Financial Information Excluding Stock-Based Compensation
Expense (Unaudited) Three Months Ended September 30, 2021 and
2020
GAAP
Stock-Based Compensation
Expense
Non-GAAP Excluding Stock-Based
Compensation Expense
2021
2020
2021
2020
2021
2020
Revenues:
(in thousands)
Subscription, transaction and services
$
32,732
$
28,808
$
32,732
$
28,808
Reimbursable costs
8,625
9,486
8,625
9,486
Total revenues
41,357
38,294
41,357
38,294
Cost of revenues:
Cost of subscription, transaction and
services
9,368
8,577
436
77
8,932
8,500
Cost of reimbursable costs
8,625
9,486
8,625
9,486
Total cost of revenues, excluding
depreciation and amortization
17,993
18,063
436
77
17,557
17,986
Operating expenses:
Research and development
13,453
9,098
1,210
159
12,243
8,939
Sales and marketing
10,310
5,745
984
117
9,326
5,628
General and administrative
9,838
5,106
3,284
473
6,554
4,633
Depreciation and amortization
1,205
1,402
1,205
1,402
Total operating expenses
34,806
21,351
5,478
749
29,328
20,602
Loss from operations
(11,442)
(1,120)
5,914
826
(5,528)
(294)
Other income (expense):
Interest income
115
1
115
1
Interest expense and loss on
extinguishment of debt
(2)
(1,120)
(2)
(1,120)
Change in fair value and other income
(expense), net
162
(443)
162
(443)
Total other expense
275
(1,562)
275
(1,562)
Loss before income taxes
(11,167)
(2,682)
5,914
826
(5,253)
(1,856)
Provision for income taxes
(27)
(33)
(27)
(33)
Net loss and comprehensive loss
$
(11,194)
$
(2,715)
$
5,914
$
826
$
(5,280)
$
(1,889)
Reconciliation of GAAP to
Non-GAAP Financial Information (Unaudited) Quarter Ended September
30, 2021 and 2020
Three Months Ended
September 30
(in thousands)
2021
Subscription, transaction and services
revenues:
Direct card revenue (DCR)
$
4,225
Software and payments (ex-DCR) revenue
21,784
Software and payments segment
revenue
$
26,009
2020
Subscription, transaction and services
revenues:
Direct card revenue (DCR)
$
2,391
Software and payments (ex-DCR) revenue
19,015
Software and payments segment
revenue
$
21,406
Direct card revenue (DCR)
growth
77%
Software and payments (ex-DCR) revenue
growth
15%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211110006277/en/
Investor Contact: John T. Williams IR@billtrust.com Media
Contact: Paul Accardo PR@billtrust.com
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