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Segment Information (Tables)

9 Months Ended

Sep. 30, 2020

Summary of information about operations by business segments

The following tables set forth information about the Company’s operations by its four business segments for the periods indicated:



	Three months ended September 30, 2020
(In thousands)	Payment Services - Puerto Rico & Caribbean		Payment Services - Latin America		Merchant Acquiring, net		Business Solutions		Corporate and Other ⁽¹⁾			Total

Revenues	$	33,284	$	21,241	$	30,646	$	63,018	$	(11,682	)	$	136,507
Operating costs and expenses	19,045		18,284		15,643		35,276		4,415			92,663
Depreciation and amortization	3,349		2,936		477		4,372		6,993			18,127
Non-operating income (expenses)	127		2,959		161		411		(970		)	2,688
EBITDA	17,715		8,852		15,641		32,524		(10,073		)	64,659
Compensation and benefits ⁽²⁾	258		686		244		466		2,015			3,669
Transaction, refinancing and other fees ⁽³⁾	500		—		—		—		1,205			1,705
Adjusted EBITDA	$	18,473	$	9,538	$	15,885	$	32,990	$	(6,853	)	$	70,033

(1)

Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $9.1 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring and intercompany software developments and transaction processing of $2.6 million from Payment Services - Latin America to Payment Services - Puerto Rico & Caribbean. Corporate and Other was impacted by the intersegment elimination of revenue recognized in the Payment Services - Latin America segment and capitalized in the Payment Services - Puerto Rico & Caribbean segment; excluding this impact, Corporate and Other Adjusted EBITDA would be $4.3 million.


(2)	Primarily represents share-based compensation.


(3)	Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement, an impairment charge and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A.



	Three months ended September 30, 2019
(In thousands)	Payment Services - Puerto Rico & Caribbean		Payment Services - Latin America			Merchant Acquiring, net		Business Solutions		Corporate and Other ⁽¹⁾			Total

Revenues	$	30,411	$	20,596		$	26,436	$	52,945	$	(11,584	)	$	118,804
Operating costs and expenses	15,821		11,943			15,978		32,259		8,001			84,002
Depreciation and amortization	3,093		2,650			457		3,780		6,992			16,972
Non-operating income (expenses)	410		(3,824		)	8		67		3,962			623
EBITDA	18,093		7,479			10,923		24,533		(8,631		)	52,397
Compensation and benefits ⁽²⁾	284		109			285		549		2,228			3,455
Transaction, refinancing and other fees ⁽³⁾	—		—			—		—		(372		)	(372		)
Adjusted EBITDA	$	18,377	$	7,588		$	11,208	$	25,082	$	(6,775	)	$	55,480

(1)

Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $10.0 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring and intercompany software sale and developments of $1.6 million from Payment Services - Latin America to Payment Services - Puerto Rico & Caribbean. Corporate and Other was impacted by the intersegment elimination of revenue recognized in the Payment Services - Latin America segment and capitalized in the Payment Services - Puerto Rico & Caribbean segment; excluding this impact, Corporate and Other Adjusted EBITDA would be $5.2 million.


(2)	Primarily represents share-based compensation, other compensation expense and severance payments.


(3)	Primarily represents the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received.



	Nine months ended September 30, 2020
(In thousands)	Payment Services - Puerto Rico & Caribbean		Payment Services - Latin America		Merchant Acquiring, net		Business Solutions		Corporate and Other ⁽¹⁾			Total

Revenues	$	90,632	$	62,678	$	80,531	$	174,455	$	(31,910	)	$	376,386
Operating costs and expenses	53,904		53,882		42,579		105,901		17,923			274,189
Depreciation and amortization	9,791		8,508		1,431		13,049		20,982			53,761
Non-operating income (expenses)	62		4,297		473		1,482		(2,815		)	3,499
EBITDA	46,581		21,601		39,856		83,085		(31,666		)	159,457
Compensation and benefits ⁽²⁾	742		2,263		695		1,374		5,846			10,920
Transaction, refinancing and other fees ⁽³⁾	500		—		—		—		5,647			6,147
Adjusted EBITDA	$	47,823	$	23,864	$	40,551	$	84,459	$	(20,173	)	$	176,524

(1)

Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $25.4 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring and intercompany software developments and transaction processing of $6.5 million from Payment Services - Latin America to Payment Services - Puerto Rico & Caribbean. Corporate and Other was impacted by the intersegment elimination of revenue recognized in the Payment Services - Latin America segment and capitalized in the Payment Services - Puerto Rico & Caribbean segment; excluding this impact, Corporate and Other Adjusted EBITDA would be $13.7 million.


(2)	Primarily represents share-based compensation.


(3)	Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement, an impairment charge and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A.



	Nine months ended September 30, 2019
(In thousands)	Payment Services - Puerto Rico & Caribbean		Payment Services - Latin America		Merchant Acquiring, net		Business Solutions		Corporate and Other ⁽¹⁾			Total

Revenues	$	92,910	$	62,533	$	79,203	$	159,492	$	(33,950	)	$	360,188
Operating costs and expenses	43,666		47,170		45,926		101,128		12,403			250,293
Depreciation and amortization	8,476		7,393		1,348		12,113		21,110			50,440
Non-operating income (expenses)	1,461		411		39		287		(2,091		)	107
EBITDA	59,181		23,167		34,664		70,764		(27,334		)	160,442
Compensation and benefits ⁽²⁾	778		448		760		1,632		6,774			10,392
Transaction, refinancing and other fees ⁽³⁾	—		2		—		—		37			39
Adjusted EBITDA	$	59,959	$	23,617	$	35,424	$	72,396	$	(20,523	)	$	170,873

(1)

Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $29.0 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring and intercompany software sale and developments of $4.9 million from Payment Services - Latin America to the Payment Services - Puerto Rico & Caribbean. Corporate and Other was impacted by the intersegment elimination of revenue recognized in the Payment Services - Latin America segment and capitalized in the Payment Services - Puerto Rico & Caribbean segment; excluding this impact, Corporate and Other Adjusted EBITDA would be $15.6 million.


(2)	Primarily represents share-based compensation, other compensation expense and severance payments.

(3)

Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received.

Reconciliation of income from operations to consolidated net income

The reconciliation of EBITDA to consolidated net income is as follows:



	Three months ended September 30,				Nine months ended September 30,
(In thousands)	2020		2019		2020		2019
Total EBITDA	$	64,659	$	52,397	$	159,457	$	160,442
Less:
Income tax expense	6,513		3,720		15,551		10,018
Interest expense, net	5,438		6,919		17,664		21,327
Depreciation and amortization	18,127		16,972		53,761		50,440
Net income	$	34,581	$	24,786	$	72,481	$	78,657