Payfare Announces Third Quarter 2024 Financial Results
Payfare generated net income of $4.5 million, and Adjusted net income per share1 of $0.17 in Q3 2024
TORONTO, Nov. 6, 2024 /PRNewswire/ - Payfare Inc. ("Payfare" or the "Company") (TSX:PAY) (OTCQX:PYFRF), a leading international Earned Wage Access ("EWA") company powering instant access to earnings and digital banking solutions for workforces, today announced the filing of its Financial Statements and Management's Discussion and Analysis ("MD&A") for the quarter ending September 30, 2024. A comprehensive discussion of Payfare's financial position and results of operations are provided in the MD&A, which is filed on SEDAR+ under Payfare's profile and can be found at www.sedarplus.ca.
Q3 2024 Highlights:
Increased revenue to $59.0 million for the three months ended September 30, 2024, representing an $11.8 million (+25%) increase compared to the same period in 2023.
Ended Q3 2024 with 1,502,028 active users1, up by 290,753 (+24%) compared to the active users1 count as at the end of Q3 2023.
Total gross dollar value (Total GDV)1 in Q3 2024 was $3.8 billion, up by $0.8 billion (+29%) over Q3 2023.
Gross Profit1 of $16.0 million for the three months ended September 30, 2024, up by $3.8 million (+31%) over the same period in 2023.
Net income of $4.5 million, or $0.09 per share, for the three months ended September 30, 2024, compared to $4.8 million in the same period in 2023.
Adjusted net income1 of $8.1 million, or $0.17 per share, for the three months ended September 30, 2024, representing an increase of $0.6 million (+8%) over the same period in 2023.
Adjusted EBITDA1 of $7.8 million for the three months ended September 30, 2024, reflecting a $1.5 million increase (+24%) compared to the same period in 2023.
Free cash flow1 of $5.4 million for the three months ended September 30, 2024, up by $1.7 million (+44%) compared to the same period in 2023.
As at September 30, 2024, Payfare has over $100 million in cash, cash equivalents and guaranteed investment certificates and is well capitalized to fund its new strategic initiatives. Payfare continues to see high growth with its other client programs that were recently renewed to long-term extensions. In addition, the Company is working on securing new, large-scale EWA programs in both the gig economy and employee verticals.
On July 16, 2024, the Company announced the formation of a Strategic Advisory Board led by a new seasoned strategy and corporate development executive to guide the Company's international expansion opportunities (including EWA platform) and achieve global scale efficiently and effectively.
On July 25, 2024, the Company announced the long-term extension of its agreement with Lyft Inc. in respect to the Lyft Direct Program, which Payfare currently powers. The extension means drivers on the Lyft program will continue to benefit from free instant pay, a feature rich digital banking platform and a rich cashback rewards program that is offered through Lyft's partnership with Payfare.
On August 27, 2024, the Company launched an upgraded version of the Lyft Direct debit card and banking app with a range of features that include: (a) Lyft Direct Savings, a high-yield savings account, (b) Balance Protection, which provides qualifying cardholders up to US$200 to cover unforeseen costs, (c) New Cashback Rewards for elite drivers, (d) Wellness Perks by Avibra, which provides access to a comprehensive suite of health and financial wellness tools, (e) Spend Insights, which helps with enhanced financial decision making and provides control of personal budgets, and (f) Cash ATM Deposits at participating ATM locations.
On September 26, 2024, Payfare announced that its core services agreements related to the DoorDash DasherDirect card program will not be renewed beyond the current term in early 2025. A transition and wind-down plan for the program has not yet been agreed to with DoorDash and it is currently unknown when the financial impact, including on revenue, net income, key performance indicators and certain non-GAAP measures utilized by the Company will be experienced by Payfare from the non-renewal.
On September 29, 2024, the Board of Directors initiated a strategic review process to explore and evaluate a broad range of potential options for the Company to enhance value, support conversion of potential new opportunities and alleviate concentration risks.
Subsequent to quarter-end, Payfare successfully launched a pilot EWA product with Automatic Data Processing Inc. ("ADP"), a leading global provider of Human Capital Management solutions, to offer EWA to the Canadian market.
Conference Call
Management will be hosting a conference call on Wednesday, November 6, 2024, at 6:30 PM ET to discuss the Company's financial results for the third quarter of 2024. A short presentation in connection with the conference call will be made available ahead of time on the Company's website at https://corp.payfare.com/investors/. Management will also host a live question and answer session on the conference call with analysts.
To access the conference call, please dial (289) 514-5100 or 1-800-717-1738. Please call the conference telephone number 10-15 minutes prior to the start time so that you are in the queue for an operator to assist in registering and patching you through.
An archived recording of the conference call will be available until December 6, 2024. To listen to the recording, call (289) 819-1325 or 1-888-660-6264 and enter passcode 70127#.
About Payfare (TSX:PAY, OTCQX:PYFRF)
Payfare is a leading, international Earned Wage Access ("EWA") company powering instant access to earnings through an award-winning digital banking platform for today's workforce. Payfare partners with leading e-commerce marketplaces, payroll platforms, and employers to provide financial security and inclusion for all workers.
1Non-IFRS and Supplementary Financial Measures
This press release contains references to "active users", "Total gross dollar value ("Total GDV"), "adjusted net income", "adjusted net income per share", "EBITDA", "Adjusted EBITDA", "free cash flow" and "gross profit", which are not measures prescribed by IFRS Accounting Standards ("IFRS"). These supplementary financial measures are provided as additional information to complement IFRS measures by providing a further understanding of our results of operations from management's perspective, to provide investors and security analysts with supplemental measures to evaluate the financial performance of the Company and highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS measures. Management also uses non-IFRS and supplementary financial measures to facilitate operating performance comparisons from period to period, prepare annual operating budgets and strategic business plans and to evaluate and price potential acquisitions.
Accordingly, non-IFRS and supplementary financial measures should not be considered in isolation or as a substitute for analysis of our financial information reported under IFRS. Such measures do not have any standardized meaning prescribed by IFRS and, therefore, may not be comparable to similar measures presented by other corporations. The non-IFRS and supplementary financial measures are not subject to standard industry definition and our definitions and method of ...
