Segment Reporting

12 Months Ended

Dec. 31, 2024

Segment Reporting

Segment Reporting

17. Segment Reporting

The Company’s chief operating decision maker is its CEO, who is charged with management of the Company and is responsible for the evaluation of operating performance and decision-making about the allocation of resources to operating segments based on the measures of net sales and EBITDA.

As the Company uses the term, “EBITDA” is defined as income before interest expense, income taxes, depreciation and amortization. The Company’s chief operating decision maker believes EBITDA is a meaningful measure and is useful as a supplement to GAAP measures as it represents a transparent view of the Company’s operating performance that is unaffected by fluctuations in property, equipment and leasehold improvement additions. The Company’s chief operating decision maker uses EBITDA to perform periodic reviews and comparison of operating trends and to identify strategies to improve the allocation of resources amongst segments.

As of December 31, 2024, the Company’s reportable segments were as follows:

● Debit and Credit;

● Prepaid Debit; and

● Other.

Debit and Credit Segment

The Debit and Credit segment primarily produces secure debit and credit cards and provides card services, including digital services, for U.S. card-issuing financial institutions. Products produced by this segment primarily include payment cards, including contact, contactless, eco-focused, and magnetic stripe cards. This segment also provides personalization services; instant issuance solutions, which provides customers the ability to issue an instant personalized debit or credit card on-demand within a customer location; and other payment solutions such as digital push provisioning.

Prepaid Debit Segment

The Prepaid Debit segment primarily provides integrated prepaid card services to prepaid program managers primarily in the U.S., including tamper-evident secure packaging. This segment also produces payment cards issued on the networks of the Payment Card Brands that are included in the tamper-evident secure packages.

Other

The Other segment includes corporate expenses.

Performance Measures of Reportable Segments

Net sales and EBITDA of the Company’s reportable segments, as well as a reconciliation of total segment EBITDA to income from operations and net income for the years ended December 31, 2024 and 2023, were as follows:

	Year Ended December 31, 2024
	Debit and Credit		Prepaid Debit		Other		Intersegment Eliminations		Total
Net sales
Products	$	251,146	$	—	$	—	$	(1,138)	$	250,008
Services		124,115		106,541		—		(63)		230,593
Total net sales		375,261		106,541		—		(1,201)		480,601
Cost of sales
Products(1)		167,174		—		—		(1,138)		166,036
Services(1)		72,255		59,760		—		(63)		131,952
Depreciation and amortization		7,737		3,657		—		—		11,394
Total cost of sales		247,166		63,417		—		(1,201)		309,382
Gross profit		128,095		43,124		—		—		171,219
Operating expenses		35,239		5,923		67,265		—		108,427
Income (loss) from operations	$	92,856	$	37,201	$	(67,265)	$	—	$	62,792
EBITDA by segment:
Income (loss) from operations	$	92,856	$	37,201	$	(67,265)	$	—	$	62,792
Depreciation and amortization		8,854		3,896		3,670		—		16,420
Other income (expense)		(82)		(10)		(3,586)		—		(3,678)
EBITDA	$	101,628	$	41,087	$	(67,181)	$	—	$	75,534
Gross profit margin		34.1%		40.5%		*		*		35.6%
EBITDA margin		27.1%		38.6%		*		*		15.7%

* Calculation not meaningful.

(1) Exclusive of depreciation and amortization.

	Year Ended December 31, 2023
	Debit and Credit		Prepaid Debit		Other		Intersegment Eliminations		Total
Net sales
Products	$	250,047	$	—	$	—	$	(693)	$	249,354
Services		111,010		84,237		—		(54)		195,193
Total net sales		361,057		84,237		—		(747)		444,547
Cost of sales
Products(1)		162,067		—		—		(693)		161,374
Services(1)		64,461		52,990		—		(54)		117,397
Depreciation and amortization		7,753		2,534		—		—		10,287
Total cost of sales		234,281		55,524		—		(747)		289,058
Gross profit		126,776		28,713		—		—		155,489
Operating expenses		31,870		3,786		58,243		—		93,899
Income (loss) from operations	$	94,906	$	24,927	$	(58,243)	$	—	$	61,590
EBITDA by segment:
Income (loss) from operations	$	94,906	$	24,927	$	(58,243)	$	—	$	61,590
Depreciation and amortization		9,025		2,860		4,046		—		15,931
Other income (expense)		29		(1)		(243)		—		(215)
EBITDA	$	103,960	$	27,786	$	(54,440)	$	—	$	77,306
Gross profit margin		35.1%		34.1%		*		*		35.0%
EBITDA margin		28.8%		33.0%		*		*		17.4%

* Calculation not meaningful.

(1) Exclusive of depreciation and amortization.

	December 31,
	2024		2023
Net income	$	19,521	$	23,985
Interest, net		34,087		26,913
Income tax expense		5,506		10,477
Depreciation and amortization		16,420		15,931
EBITDA	$	75,534	$	77,306

Balance Sheet Data of Reportable Segments

Total assets of the Company’s reportable segments as of December 31, 2024 and 2023 were as follows:

	December 31,
	2024		2023
Debit and Credit	$	248,970	$	235,680
Prepaid Debit		60,621		38,265
Other		40,066		19,738
Total assets	$	349,657	$	293,683

Capital Expenditures of Reportable Segments

Total capital expenditures of the Company’s reportable segments as of December 31, 2024 and 2023 were as follows:

	December 31,
	2024		2023
Debit and Credit	$	6,921	$	5,116
Prepaid Debit		2,319		963
Other		17		326
Total capital expenditures	$	9,257	$	6,405