GlobeNewswire Inc | May 12, 2021 04:09PM EDT

May 12, 2021

Generated Strong TPV and Revenue Growth

Raises Revenue Guidance for the Full Year 2021

LAWRENCEVILLE, N.J., May 12, 2021 (GLOBE NEWSWIRE) -- BTRS Holdings Inc. ("Billtrust" or "the Company") (NASDAQ: BTRS), a B2B accounts receivable automation and integrated payments leader, today announced financial results for its first quarter ended March31, 2021.

"I am very pleased with our first quarter results as momentum from 2020 carried over into 2021 delivering a strong start to the year," said Flint Lane, Founder and CEO of Billtrust. "First quarter results came in ahead of our internal expectations as the digital transformation of accounts receivable and B2B payments continues to accelerate, leading us to raise our guidance for the full year. Our industry-leading solutions position us incredibly well to capitalize on the massive shift to digitalization and we are excited about the opportunity to grow and scale our business.

Financial Highlights for the First Quarter Ended March31, 2021, as Compared to the Same Period in 2020

GAAP Metrics

-- Total revenue increased 22.8% year-over-year to $41.9 million from $34.1 million in 2020. Included in total revenue, segment revenue, gross profit excluding depreciation and amortization, and net loss and comprehensive loss was $2.5 million of accelerated deferred revenue from a customer contract which terminated in the first quarter of 2021. -- Software and payments segment revenue increased 40.1% year-over-year to $25.7 million from $18.3 million for the same period in 2020. -- Gross profit, excluding depreciation and amortization, increased 43.5% year-over-year to $23.9 million from $16.6 million for the same period in 2020. -- Gross margin, excluding depreciation and amortization, expanded by 819 basis points to 56.9% from 48.7% 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 $(22.8) million compared to $(7.1) million in 2020. Net loss in 2021 also includes other expense of $10.0 million associated with fair value adjustments for certain earnout related shares that were issued or vested during the first quarter of 2021.

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 during the quarter by 33% year-over-year to $15.1 billion from $11.4 billion for the same period in 2020. -- Net revenue* increased 35.0% year-over-year to $33.1 million from $24.5 million in 2020. Excluding the impact of the accelerated deferred revenue, net revenue increased 25.0%. -- Adjusted gross profit* increased 45.9% year-over-year to $24.3 million from $16.7 million for the same period in 2020. Excluding the impact of the accelerated deferred revenue, adjusted gross profit increased 31.0%. -- Adjusted gross margin* expanded by 544 basis points to 73.4% from 68.0% for the same period in 2020. Excluding the impact of the accelerated deferred revenue, adjusted gross margin expanded by 329 basis points to 71.3%. -- Adjusted EBITDA* was positive $0.3 million, compared to a loss of $(3.7) million for the same period in 2020. Excluding the impact of the accelerated deferred revenue, adjusted EBITDA in the quarter was $(2.2) million.

Recent Business Highlights

-- Billtrust Named a Leader in the IDC MarketScape for Accounts Receivable Automation Software for Enterprise -- Business Payments Network ("BPN") continues to gain traction Added a major new A/P partner and significant new supplier business from partner referralsBPN TPV increased 146% year-over-year, including new BPN 3.0 volume from ACH and wires.BPN Card volume increased 117% year-over-year -- Billtrust Mobile Deposit capture approaches $100 million in spend in Q1, less than a year after launch -- Entered into agreement with The Commonwealth Group, a major plumbing wholesaler buying group, for our Billtrust eCommerce solution

Full Year 2021 Outlook

Billtrust provides the following updated financial guidance for the full year 2021:

-- Total revenue between $160 million to $166 million, including reimbursable costs revenue of $37 million, up from a previous range of $159 million to $165 million -- Net revenue* between $123 million to $129 million, which at the midpoint of $126 million would be an increase of approximately 16%, up from a previous range of $122 million to $128 million -- Adjusted gross profit* between $85 million to $89 million -- Adjusted gross margin* between 69% to 71% -- Adjusted EBITDA* between a loss of $(14) million to a loss of $(16) million, including additional public company costs

* Net revenue, adjusted gross profit, adjusted gross margin and adjusted EBITDA, and the impact of accelerated deferred revenue on those metrics during the period, are non-GAAP measures. An explanation of these measures and how they are calculated can be found under the heading Non-GAAP Financial Measures. 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. Billtrust has not reconciled its 2021 guidance for 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 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.

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 AR, 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 Billtrusts financial guidance and estimates and forecasts of Billtrusts financial and performance metrics, the potential benefits, value and the commercial attractiveness to its customers of Billtrusts products and services, Billtrusts opportunity and ability to grow and scale its business, and Billtrusts technology platform. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of Billtrusts 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 Billtrusts ability to attract and retain customers and expand customers use of Billtrusts services; market, financial, political and legal conditions; the impact of the COVID-19 pandemic on Billtrusts 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; the effects of competition on Billtrusts future business; and the risks discussed in Billtrusts Annual Report on Form 10-K filed on March 24, 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 Billtrusts 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 Billtrusts 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 Billtrusts 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 Billtrusts 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 Billtrusts actual and projected financial condition and operating results and trends in and in comparing Billtrusts 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 Billtrusts 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 Billtrusts audited financial statements and the other financial information included in the Final Prospectus and 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 and other income (expense), net, (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) minus interest income.

Investor Contact:BilltrustIR@icrinc.com

Media Contact:Meredith Simpsonmsimpson@billtrust.com

Condensed Consolidated Statements of Operations(Unaudited)

Three Months Ended March 31, 2021 2020Revenues: (in thousands)Subscription, transaction and services $ 33,119 $ 24,524 Reimbursable costs 8,817 9,621 Total revenues 41,936 34,145 Cost of revenues: Cost of subscription, transaction and 9,253 7,890 servicesCost of reimbursable costs 8,817 9,621 Total cost of revenues, excluding 18,070 17,511 depreciation and amortization Operating expenses: Research and development 10,993 9,384 Sales and marketing 8,936 6,422 General and administrative 12,450 5,248 Depreciation and amortization 1,360 1,411 Total operating expenses 33,739 22,465 Loss from operations (9,873 ) (5,831 ) Other income (expense): Interest income 103 16 Interest expense and loss on (2,942 ) (1,183 ) extinguishment of debtChange in fair value and other income (9,990 ) (19 ) (expense), netTotal other expense (12,829 ) (1,186 ) Loss before income taxes (22,702 ) (7,017 ) Provision for income taxes (92 ) (80 ) Net loss and comprehensive loss $ (22,794 ) $ (7,097 ) Net loss per share attributable to common stockholdersBasic and diluted $ (0.16 ) $ (0.07 ) Weighted average number of shares used tocompute net loss per share attributable to common stockholdersBasic and diluted 144,207 99,804

Selected Segment Information(Unaudited)

Three Months Ended March 31, Software Print and All other Total Payments^1 (in thousands)2021 Revenues: Subscription and transaction $ 4,498 $ 25,685 $ ? $ 30,183 Services and other ? ? 2,936 2,936 Subscription, transaction and 4,498 25,685 2,936 33,119 servicesReimbursable costs 8,817 ? ? 8,817 Total revenues $ 13,315 $ 25,685 $ 2,936 $ 41,936 2020 Revenues: Subscription and transaction $ 4,786 $ 18,339 $ ? $ 23,125 Services and other ? ? 1,399 1,399 Subscription, transaction and 4,786 18,339 1,399 24,524 servicesReimbursable costs 9,621 ? ? 9,621 Total revenues $ 14,407 $ 18,339 $ 1,399 $ 34,145

1 Includes $2.5 million of accelerated deferred revenue in the three months ended March 31, 2021

Schedule of Changes in Cash, Cash Equivalents, Restricted Cashand Short-Term Investments(Unaudited)

Three Months Ended March 31 2021 2020 (in thousands)Net increase in cash and cash equivalents and $ 246,008 $ 8,300 restricted cashCash and cash equivalents and restricted cash, 17,919 4,736 beginning of periodCash, cash equivalents and restricted cash, end of $ 263,927 $ 13,036 period Summary of cash, cash equivalents, and restricted cash, end of period:Cash and cash equivalents $ 261,013 $ 9,761 Restricted cash 2,914 3,275 Total cash, cash equivalents, and restricted cash $ 263,927 $ 13,036 Short-term investments $ 25,000 $ ?

Reconciliation of GAAP to Non-GAAP Financial Information(Unaudited)

Three Months Ended Increase March 31, (decrease) 2021 2020 (in thousands) Total revenues $ 41,936 $ 34,145 22.8%Less: Reimbursable costs revenue 8,817 9,621 Net revenue (non-GAAP) $ 33,119 $ 24,524 35.0%Less: accelerated deferred revenue from 2,470 ? terminated customer contractNet revenue (non-GAAP), excluding accelerated $ 30,649 $ 24,524 25.0%deferred revenue Total revenues $ 41,936 $ 34,145 Less: Cost of revenue, excluding depreciation 18,070 17,511 and amortizationGross profit, excluding depreciation and 23,866 16,634 43.5%amortizationAdd: Stock based compensation expense 443 33 Adjusted gross profit (non-GAAP) $ 24,309 $ 16,667 45.9%Less: accelerated deferred revenue from 2,470 ? terminated customer contractAdjusted gross profit (non-GAAP), excluding $ 21,839 $ 16,667 31.0%accelerated deferred revenue Gross margin, excluding depreciation and 56.9% 48.7% amortizationAdjusted gross margin (non-GAAP) 73.4% 68.0% Adjusted gross margin (non-GAAP), excluding 71.3% 68.0% accelerated deferred revenue

Reconciliation of GAAP to Non-GAAP Financial Information(Unaudited)

Three Months Ended March 31, 2021 2020 (in thousands)Net loss and comprehensive loss $ (22,794 ) $ (7,097 ) Provision for income taxes 92 80 Change in fair value and other (income) expense, net 9,990 19 Interest expense and loss on extinguishment of debt 2,942 1,183 Interest income (103 ) (16 ) Depreciation and amortization 1,360 1,411 Stock-based compensation expense 8,826 481 Restructuring and severance 6 181 Acquisition and integration expenses ? 53 Adjusted EBITDA (non-GAAP) $ 319 $ (3,705 ) Less: accelerated deferred revenue from terminated 2,470 ? customer contractAdjusted EBITDA (non-GAAP), excluding accelerated $ (2,151 ) $ (3,705 ) deferred revenue

Outlook (Mid-point) for Full Year 2021 (in thousands)Total revenues $ 163,000Less: Reimbursable costs revenue 37,000Net revenue (non-GAAP) $ 126,000

Reconciliation of GAAP to Non-GAAP Financial Information(Unaudited)Three Months Ended March 31, 2021 and 2020

Non-GAAP Stock-Based Excluding GAAP Compensation Stock-Based Expense Compensation Expense 2021 2020 2021 2020 2021 2020 Revenues: (in thousands)Subscription,transaction and $ 33,119 $ 24,524 $ 33,119 $ 24,524 servicesReimbursable costs 8,817 9,621 8,817 9,621 Total revenues 41,936 34,145 41,936 34,145 Cost of revenues: Cost ofsubscription, 9,253 7,890 443 33 8,810 7,857 transaction andservicesCost of 8,817 9,621 8,817 9,621 reimbursable costsTotal cost ofrevenues, excluding 18,070 17,511 443 33 17,627 17,478 depreciation andamortization Operating expenses: Research and 10,993 9,384 1,223 100 9,770 9,284 developmentSales and marketing 8,936 6,422 1,333 74 7,603 6,348 General and 12,450 5,248 5,827 274 6,623 4,974 administrativeDepreciation and 1,360 1,411 1,360 1,411 amortizationTotal operating 33,739 22,465 8,383 448 25,356 22,017 expensesLoss from (9,873 ) (5,831 ) 8,826 481 (1,047 ) (5,350 ) operationsOther income (expense):Interest income 103 16 103 16 Interest expenseand loss on (2,942 ) (1,183 ) (2,942 ) (1,183 ) extinguishment ofdebtChange in fairvalue and other (9,990 ) (19 ) (9,990 ) (19 ) income (expense),netTotal other expense (12,829 ) (1,186 ) (12,829 ) (1,186 ) Loss before income (22,702 ) (7,017 ) 8,826 481 (13,876 ) (6,536 ) taxesProvision for (92 ) (80 ) (92 ) (80 ) income taxesNet loss and $ (22,794 ) $ (7,097 ) $ 8,826 $ 481 $ (13,968 ) $ (6,616 ) comprehensive loss