EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1

Exhibit 99.1

Nayax Reports Second Quarter 2023 Financial Results 
Revenue Grew 36% Year-Over-Year to $56.2 Million
Recurring Revenue Grew 43% Year-Over-Year
Reaffirms: FY 2023 Revenue; YoY Growth of at least 35%; Earnings Outlook
 
HERZLIYA, Israel, August 9, 2023 (Globe Newswire) – Nayax Ltd. (Nasdaq, TASE: NYAX), a global commerce enablement and payments platform designed to enable retailers to provide consumers with digital, cashless, connected commerce experiences, and enhance consumer loyalty and conversion, today announced its financial results for the second quarter 2023.
 
“Our business momentum continued into the second quarter. We delivered strong revenue growth of 36% year-over-year and improved Adjusted EBITDA to $1.3 million, driven by the excellent growth of our recurring revenue sources and ongoing operating efficiencies across the business. More importantly, I am pleased that we reported an improvement in our overall gross margin mainly from our hardware component cost management.” said Yair Nechmad, Chief Executive Officer and Chairman of the Board. “These results reflect the continued execution of our strategic initiatives and the secular trends driving our core unattended market.”

Mr. Nechmad continued, “Nayax’s business fundamentals remain strong and our differentiated growth strategies and value proposition as a global solutions provider, with a complete end-to-end solution, continues to resonate with our diverse customer base. We remain focused on executing our strategies while maintaining a balance between growth and improved profitability.”

Second Quarter Financial Highlights
 
(All comparisons are relative to the three-month period ended June 30, 2022, unless otherwise stated):
 

Total revenue of $56.2 million, an increase of 36.4%.
 

Recurring revenue from monthly SaaS and payment processing fees grew 42.9% and represented 65% of total revenue in Q2 2023.

Revenue Breakdown 
Q2 2023 ($M)
Q2 2022 ($M)
Change (%)
SaaS Revenue
14.3
10.8
32.4%
Payment Processing Fees
22.0
14.6
50.7%
       
Total Recurring Revenue (*)
36.3
25.4
42.9%
POS Devices Revenue (**)
19.9
15.8
25.9%
Total Revenue
56.2
41.2
36.4%

(*) Recurring Revenue comprised of SaaS revenue and payment processing fees.
(**) POS Devices Revenue includes revenues that are derived from the sale of our hardware products.




Q2 2023 gross margin was 37%, higher compared to Q1 2023 of 34% and Q2 2022 of 33%. The improvement was mainly attributed to our hardware component cost management execution and favorable hardware selling prices. During the quarter, hardware gross margin improved to 19% from 12% in Q1 2023. For 1H 2023, hardware gross margin was 15%, as previously communicated.
 

Overall gross margin continues to be impacted by the higher mix of POS devices revenue, and increase in processing fees, which have lower margins than SaaS revenue.
 

Gross profit reached $20.9 million, an increase of 48%.
 

Operating expenses, including research and development, share-based compensation expenses, and depreciation and amortization amounted to $24.2 million, an increase of 6.5% from Q1 2023. This modest increase reflects select hiring during the quarter in the R&D and SG&A functions.
 

Q2 2023 Operating loss was $3.7 million, compared to an operating loss of $8.6 million, representing a significant improvement in expense management.
 

Net loss for Q2 2023 was $4.0 million, or ($0.120) per diluted share, compared to a net loss of 10.3 million, or ($0.316) per diluted share.


We continued to make significant strides in improving our bottom line. Adjusted EBITDA was a positive $1.3 million for the first time in two years, since Q1 2021, a marked improvement of $4.5 million to Adjusted EBITDA compared to negative $3.2 million in Q2 2022.
 
Explanation of Company Revenues
 
The Company provides payment processing and business operations software solutions and services through its global cashless payment platform. Nayax generates revenue from the sale of its POS devices, a monthly subscription fee for access to its SaaS solutions, and payment processing fees for transactions made at the point-of-sale and through its global platform, as provided in the chart above.
 
In Q2 2023, the Company recorded strong growth in its recurring revenue from SaaS and payment processing, reflecting 65% of total revenue. This increase in recurring revenue represents growth in both the number of transactions processed through our devices as well as an increase in total transaction value, as well as an increase in SaaS revenue. This growth is a result of our growing install base of managed and connected devices as well as the continued rapid adoption of cashless payments by consumers.

2

 
Second Quarter Business and Operational Highlights
 
(All comparisons are relative to the three-month period ended June 30, 2022, unless otherwise stated):
 

Expanded our diverse customer base this quarter, by adding 4,000 new customers across our global footprint, bringing our total customer base to 56,000, as of June 30, 2023, an increase of 47%
 

Dollar-based net retention rate was 139%, reflecting the high satisfaction and loyalty our customers place on our comprehensive solutions to increase their revenue and improve their operations.
 

Added almost 56,000 managed and connected devices during the quarter, driven by robust customer demand, bringing the total number of managed and connected devices to 824,000. This represents an increase of 38%.
 

Number of processed transactions grew by 41% to 446 million.
 

Total transaction value increased by 51% to $885 million.
 

Extended our relationship with Primo Water in the US with additional Nayax devices and plan to expand globally.
 

The leading US unattended retail provider extended its program with Nayax by purchasing devices for a water refilling project at a large car manufacturer.
 

Added Synergy Energy as a new Tier 1 customer. Synergy Energy is Western Australia’s largest energy retailer and generator. Synergy has chosen to rollout their EV DC chargers with Nayax devices embedded. This deployment of EV fast chargers with cashless payments is the first in Australia.
 
Operational Metrics

We regularly monitor various operational metrics to help us evaluate our business, identify trends affecting our business, formulate business plans and make strategic decisions. We believe these financial and operating metrics are useful in evaluating our business. Although these operating and financial metrics are frequently used by investors and security analysts in their evaluation of companies, such metrics have limitations as analytical tools, and should not be considered in isolation or as substitutes for analysis of our results of operations as reported under IFRS. In addition, our operating and financial metrics may be calculated in a different manner than similarly titled metrics used by other companies.

Key Performance Indicators
Q2 2023
Q2 2022
Change (%)
Total Transaction Value ($m)
  885
  585
51%
Number of Processed Transactions (millions)
446
316
41%
Take Rate % (Payments) (*)
2.49%
2.50%
-0.4%
Managed and Connected Devices
824,000
595,000
38%

(*) Payment service providers typically take a percentage of every transaction in exchange for facilitating the movement of funds from the buyer to the seller. Take rate % (payments) is calculated by dividing the total dollar transaction value by the Company’s processing revenue in the same quarter.
3


Recent Developments
 
The Israel Competition Authority (the “ICA”) has requested from Nayax certain documents and other information related mainly to its acquisition of On Track Innovation Ltd. The Company has provided the requested information and commenced discussions with the ICA, which are ongoing. At this early stage, it is difficult to assess when this process will conclude and what the results might be.

Outlook:
 
Full-Year 2023 Outlook: We are reaffirming our full-year 2023 outlook.
 

Revenue on a constant currency basis to be in the range of $235 million to $240 million, representing year-over-year growth of at least 35%.
 

Operating expenses to stay flat from Q4 2022 annualized run rate.
 

Adjusted EBITDA to be between $3 to $7 million in 2023.
 
Full-Year 2023 Assumptions:
 

Continued execution of strategic growth plans and benefits of secular trends in digital payments.
 

Customer demand continues to be strong.
 

Assumes no material changes in macroeconomic conditions.
 
The outlook provided above constitutes forward-looking information within the meaning of applicable securities laws and is based on a number of assumptions and subject to a number of risks. See cautionary note regarding “Forward-looking Statements” below.
 
We cannot reconcile expected 2023 Adjusted EBITDA to expected net income without unreasonable effort because certain items that impact net income and other reconciling metrics are out of our control and/or cannot be reasonably predicted at this time, which unavailable information could have a significant impact on our IFRS financial results.
4

 
Mid-Term Outlook:
 

We are reaffirming our mid-term revenue outlook of 35% annual growth, driven by organic growth initiatives, with customer growth, market penetration and continued expansion of our integrated payments platform as well as our emerging growth engines and strategic M&A.
 
Long-Term Outlook:
 

We are reaffirming our long-term outlook of 35% annual growth, driven by organic growth initiatives and strategic M&A.

Our long-term gross margin target of 50% is driven by leasing options for IoT POS, growing SaaS revenue and payment processing fees along with services offering through our emerging growth initiatives.

Our long-term Adjusted EBITDA margin target is 30%.

Conference Calls:

Nayax will host two conference calls and webcasts on August 9, 2023. The first in English and the other in Hebrew to discuss 2023 second quarter results. The call in English will be held at 8:30 a.m. Eastern Time, 3:30 p.m. Israel Time and 5:30 a.m. Pacific Time, followed by the conference call in Hebrew at 9:30 a.m. Eastern Time, 4:30 p.m. Israel time and 6:30 a.m. Pacific Time. Participating on the call will be Yair Nechmad, Chief Executive Officer and Sagit Manor, Chief Financial Officer.

For the conference call in English, we encourage participants to pre-register using the link below. Those who pre-register will be given a unique PIN to gain immediate access to the call, bypassing the live operator. Participants may pre-register any time, including up to and after the call/webcast start time. You will immediately receive an online confirmation, an email with the dial in number and a calendar invitation for the event.

To pre-register, go to:
 
https://services.choruscall.ca/DiamondPassRegistration/register?confirmationNumber=10021592&linkSecurityString=1942bb5270

For those who are unable to pre-register, kindly join the conference call/webcast by using one of the dial-in numbers or clicking the webcast link below.
 
U.S. TOLL-FREE: 1-855-327-6837
ISRAEL TOLL-FREE: 1-809-458-327
INTERNATIONAL TOLL-FREE: 1-631-891-4304

5

WEBCAST LINK:
https://viavid.webcasts.com/starthere.jsp?ei=1606973&tp_key=393718686b
 
Participants may also register and join the conference call/webcast by visiting the Events section of the Nayax website, found here: Events
 
Following the conference call, a replay will be available until August 23, 2023. To access the replay, please dial one of the following numbers: 
 
Replay TOLL-FREE: 1-844-512-2921
Replay TOLL/INTERNATIONAL: 1-412-317-6671
Replay Pin Number: 10021592

An archive of the conference call will be available on Nayax's Investor Relations website Nayax - Investor Relations

To access the conference call/webcast in Hebrew, use the link with passcode below:
https://us02web.zoom.us/j/88222545837?pwd=MkM2dm1JdVhGa2dKdjZmKzhtVHNodz09

Forward-Looking Statements

This press release contains statements that constitute forward-looking statements. Many of the forward-looking statements contained in this press release can be identified by the use of forward-looking words such as “anticipate,” “believe,” “could,” “expect,” “should,” “plan,” “intend,” “estimate” and “potential,” among others. Forward-looking statements include, but are not limited to, statements regarding our intent, belief or current expectations. Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to of various factors, including, but not limited to: our expectations regarding general market conditions, including as a result of the COVID-19 pandemic and other global economic trends; changes in consumer tastes and preferences; fluctuations in inflation, interest rate and exchange rates in the global economic environment over the world; the availability of qualified personnel and the ability to retain such personnel; changes in commodity costs, labor, distribution and other operating costs; our ability to implement our growth strategy; changes in government regulation and tax matters; other factors that may affect our financial condition, liquidity and results of operations; general economic, political, demographic and business conditions in Israel; the success of operating initiatives, including advertising and promotional efforts and new product and concept development by us and our competitors; and other risk factors discussed under “Risk Factors” in our annual report on Form 20-F filed with the SEC on March 1, 2023 (our "Annual Report"). The preceding list is not intended to be an exhaustive list of all of our forward-looking statements. The forward- looking statements are based on our beliefs, assumptions and expectations of future performance, taking into account the information currently available to us. These statements are only estimates based upon our current expectations and projections about future events. There are important factors that could cause our actual results, levels of activity, performance or achievements to differ materially from the results, levels of activity, performance or achievements expressed or implied by the forward-looking statements. In particular, you should consider the risks provided under “Risk Factors” in our Annual Report. You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Each forward-looking statement speaks only as of the date of the particular statement. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason, to conform these statements to actual results or to changes in our expectations.
6


Use of Non-IFRS Financial Information

In addition to various operational metrics and financial measures in accordance with accounting principles generally accepted under International Financial Reporting Standards, or IFRS, this press release contains Adjusted EBITDA, a non-IFRS financial measure, as a measure to evaluate our past results and future prospects.
 
Adjusted EBITDA

Adjusted EBITDA is a non-IFRS financial measure that we define as loss for the period plus finance expenses, tax expense, depreciation and amortization, share-based compensation costs, non-recurring issuance costs and our share in losses of associates accounted for by the equity method.

We present Adjusted EBITDA in this press release because it is a measure that our management and board of directors utilize as a measure to evaluate our operating performance and for internal planning and forecasting purposes. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.

We believe that Adjusted EBITDA, when taken collectively with financial measures prepared in accordance with IFRS, may be helpful to investors because it provides an additional tool for investors to use in evaluating our ongoing operating results and trends and in comparing our financial results with other companies because it provides consistency and comparability with past financial performance. However, our management does not consider this non-IFRS measure in isolation or as an alternative to financial measures determined in accordance with IFRS.

Adjusted EBITDA is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with IFRS. Adjusted EBITDA may be different from similarly-titled measures used by other companies. The principal limitation of Adjusted EBITDA is that it excludes significant expenses that are required by IFRS to be recorded in our financial statements, as further detailed above. In addition, it is subject to inherent limitations as it reflects the exercise of judgment by management about which expenses are excluded or included in determining Adjusted EBITDA.

A reconciliation is provided at the end of this press release for Adjusted EBITDA to net loss, the most directly comparable financial measure prepared in accordance with IFRS. Investors are encouraged to review net loss and the reconciliation to Adjusted EBITDA included below and to not rely on any single financial measure to evaluate our business.
7


Constant Currency

Nayax presents constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. Future expected results for transactions in currencies other than United States dollars are converted into United States dollars using the exchange rates in effect in the last month of the reporting period. Nayax provides this financial information to aid investors in better understanding our performance. These constant currency financial measures presented in this release should not be considered as a substitute for, or superior to, the measures of financial performance prepared in accordance with IFRS.

The Company cannot provide expected 2023 net income without unreasonable effort because certain items that impact net income are out of the Company's control and/or cannot be reasonably predicted at this time, which unavailable information could have a significant impact on the Company’s IFRS financial results.

About Nayax
 
Nayax is a global commerce enablement and payments platform designed to help merchants scale their business. Nayax offers a complete solution including localized cashless payment acceptance, management suite, and consumer engagement tools, enabling merchants to conduct commerce anywhere, at any time. With foundations and global leadership in serving unattended retail, Nayax has transformed into a comprehensive solution focused on our customers' growth across multiple channels. Today, Nayax has 9 global offices, approximately 800 employees, connections to more than 80 merchant acquirers and payment method integrations and is a recognized payment facilitator worldwide. Nayax's mission is to improve our customers' revenue potential and operational efficiency. For more information, please visit www.nayax.com
 
Investor Relations Contact:
Virginea Stuart Gibson
Vice President, Investor Relations
virgineas@nayax.com
 
Public Relations Contact:
Courtney Tolbert
5W PR
ctolbert@5wpr.com
 
8


NAYAX LTD
 
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
 
As of June 30, 2023
(Unaudited)

9


NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)

   
June 30
   
December 31
 
   
2023
   
2022
 
   
U.S. dollars in thousands
 
ASSETS
           
             
CURRENT ASSETS:
           
Cash and cash equivalents
   
31,050
     
33,880
 
Restricted cash transferable to customers for processing activity
   
50,575
     
34,119
 
Short-term bank deposits
   
1,234
     
83
 
Receivables in respect of processing activity
   
32,404
     
25,382
 
Trade receivable, net
   
32,462
     
27,412
 
Inventory
   
22,924
     
23,807
 
Other current assets
   
7,215
     
5,777
 
Total current assets
   
177,864
     
150,460
 
                 
NON-CURRENT ASSETS:
               
Long-term bank deposits
   
1,315
     
1,336
 
Other long-term assets
   
5,196
     
2,948
 
Investment in associate
   
5,837
     
6,579
 
Right-of-use assets, net
   
6,340
     
7,381
 
Property and equipment, net
   
5,930
     
6,668
 
Goodwill and intangible assets, net
   
59,344
     
55,116
 
Total non-current assets
   
83,962
     
80,028
 
TOTAL ASSETS
   
261,826
     
230,488
 

10


NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)

   
June 30
   
December 31
 
   
2023
   
2022
 
   
U.S. dollars in thousands
 
LIABILITIES AND EQUITY
           
             
CURRENT LIABILITIES:
           
Short-term bank credit
   
18,069
     
7,684
 
Current maturities of long-term bank loans
   
1,033
     
1,052
 
Current maturities of loans from others and other long-term liabilities
   
4,990
     
4,126
 
Current maturities of leases liabilities
   
2,216
     
2,206
 
Payables in respect of processing activity
   
94,846
     
63,336
 
Trade payables
   
12,135
     
14,574
 
Other payables
   
17,936
     
17,229
 
Total current liabilities
   
151,225
     
110,207
 
                 
NON-CURRENT LIABILITIES:
               
Long-term bank loans
   
861
     
1,444
 
Long-term loans from others and other long-term liabilities
   
3,606
     
7,062
 
Post-employment benefit obligations, net
   
429
     
403
 
Lease liabilities
   
5,058
     
5,944
 
Deferred income taxes
   
691
     
793
 
Total non-current liabilities
   
10,645
     
15,646
 
TOTAL LIABILITIES
   
161,870
     
125,853
 
                 
EQUITY:
               
Share capital
   
8
     
8
 
Additional paid in capital
   
152,648
     
151,406
 
Capital reserves
   
9,880
     
9,771
 
Accumulated deficit
   
(62,580
)
   
(56,550
)
TOTAL EQUITY
   
99,956
     
104,635
 
TOTAL LIABILITIES AND EQUITY
   
261,826
     
230,488
 

11


NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF LOSS (UNAUDITED)

   
Six months ended
June 30
   
Three months ended
June 30
 
   
2023
   
2022
   
2023
   
2022
 
   
U.S. dollars in thousands
 
   
(Excluding loss per share data)
 
                         
Revenues
   
108,569
     
75,343
     
56,159
     
41,211
 
Cost of revenues
   
(69,838
)
   
(48,144
)
   
(35,303
)
   
(27,105
)
Gross Profit
   
38,731
     
27,199
     
20,856
     
14,106
 
                                 
Research and development expenses
   
(10,106
)
   
(10,692
)
   
(4,970
)
   
(5,098
)
Selling, general and administrative expenses
   
(33,967
)
   
(29,946
)
   
(17,536
)
   
(15,121
)
Depreciation and amortization in respect of technology and capitalized development costs
   
(2,814
)
   
(2,111
)
   
(1,674
)
   
(1,066
)
Other expenses, net
   
-
     
(866
)
   
-
     
(866
)
Share of loss of equity method investee
   
(741
)
   
(1,071
)
   
(383
)
   
(570
)
Operating loss
   
(8,897
)
   
(17,487
)
   
(3,707
)
   
(8,615
)
Finance expenses, net
   
(118
)
   
(2,357
)
   
(40
)
   
(1,499
)
Loss before taxes on income
   
(9,015
)
   
(19,844
)
   
(3,747
)
   
(10,114
)
Income tax expense
   
(485
)
   
(285
)
   
(226
)
   
(235
)
Loss for the period
   
(9,500
)
   
(20,129
)
   
(3,973
)
   
(10,349
)
                                 
Attribution of loss for the period:
                               
Total
   
(9,500
)
   
(20,129
)
   
(3,973
)
   
(10,349
)
                                 
Loss per share attributed to shareholders of the Company:
                               
Basic and diluted loss per share
   
(0.288
)
   
(0.614
)
   
(0.120
)
   
(0.316
)

12


NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED)

   
Six months ended
June 30
   
Three months ended
June 30
 
   
2023
   
2022
   
2023
   
2022
 
   
U.S. dollars in thousands
 
Loss for the period
   
(9,500
)
   
(20,129
)
   
(3,973
)
   
(10,349
)
                                 
Other comprehensive loss for the period:
                               
Items that may be reclassified to profit or loss:
                               
Exchange differences on translation of foreign operations
   
109
     
(489
)
   
70
     
(339
)
Total comprehensive loss for the period
   
(9,391
)
   
(20,618
)
   
(3,903
)
   
(10,688
)
                                 
Attribution of total comprehensive loss for the period:
                               
Total comprehensive loss for the period
   
(9,391
)
   
(20,618
)
   
(3,903
)
   
(10,688
)

13


NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)

   
Equity attributed to shareholders of the Company
       
   
Share
capital
   
Additional paid in capital
   
Remeasurement of post-employment benefit obligations
   
Other capital reserves
   
Foreign currency translation reserve
   
Accumulated
deficit
   
Total equity attributed to shareholders of the Company
   
Total
equity
 
   
U.S. dollars in thousands
 
                                                 
Balance at January 1, 2023 (audited)
   
8
     
151,406
     
248
     
9,503
     
20
     
(56,550
)
   
104,635
     
104,635
 
Changes in the six months ended June 30, 2023:
                                                               
Loss for the period
   
-
     
-
     
-
     
-
     
-
     
(9,500
)
   
(9,500
)
   
(9,500
)
Other comprehensive loss for the period
   
-
     
-
     
-
     
-
     
109
     
-
     
109
     
109
 
Employee options exercised
   
*
     
1,242
     
-
     
-
     
-
     
-
     
1,242
     
1,242
 
Share-based payment
   
-
     
-
     
-
     
-
     
-
     
3,470
     
3,470
     
3,470
 
Balance on June 30, 2023 (unaudited)
   
8
     
152,648
     
248
     
9,503
     
129
     
(62,580
)
   
99,956
     
99,956
 
                                                                 
Balance at January 1, 2022 (audited)
   
8
     
150,366
     
102
     
9,503
     
394
     
(28,697
)
   
131,676
     
131,676
 
Changes in the six months ended June 30, 2022:
                                                               
Loss for the period
   
-
     
-
     
-
     
-
     
-
     
(20,129
)
   
(20,129
)
   
(20,129
)
Other comprehensive loss for the period
   
-
     
-
     
-
     
-
     
(489
)
   
-
     
(489
)
   
(489
)
Employee options exercised
   
*
     
397
     
-
     
-
     
-
     
-
     
397
     
397
 
Share-based payment
   
-
     
-
     
-
     
-
     
-
     
5,635
     
5,635
     
5,635
 
Balance on June 30, 2022 (unaudited)
   
8
     
150,763
     
102
     
9,503
     
(95
)
   
(43,191
)
   
117,090
     
117,090
 
 
(*) Represents an amount lower than $1 thousand.
14


NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)

   
Equity attributed to shareholders of the Company
       
   
Share
capital
   
Additional paid in capital
   
Remeasurement of post-employment benefit obligations
   
Other capital reserves
   
Foreign currency translation reserve
   
Accumulated
deficit
   
Total equity attributed to shareholders of the Company
   
Total
equity
 
   
U.S. dollars in thousands
 
                                                 
Balance at April 1, 2023 (unaudited)
   
8
     
151,710
     
248
     
9,503
     
59
     
(60,286
)
   
101,242
     
101,242
 
Changes in the three months ended June 30, 2023:
                                                               
Loss for the period
   
-
     
-
     
-
     
-
     
-
     
(3,973
)
   
(3,973
)
   
(3,973
)
Other comprehensive loss for the period
   
-
     
-
     
-
     
-
     
70
     
-
     
70
     
70
 
Employee options exercised
   
*
     
938
     
-
     
-
     
-
     
-
     
938
     
938
 
Share-based compensation
   
-
     
-
     
-
     
-
     
-
     
1,679
     
1,679
     
1,679
 
Balance on June 30, 2023 (unaudited)
   
8
     
152,648
     
248
     
9,503
     
129
     
(62,580
)
   
99,956
     
99,956
 
                                                                 
Balance at April 1, 2022 (unaudited)
   
8
     
150,460
     
102
     
9,503
     
244
     
(35,217
)
   
125,100
     
125,100
 
Changes in the three months ended June 30, 2022:
                                                               
Loss for the period
   
-
     
-
     
-
     
-
     
-
     
(10,349
)
   
(10,349
)
   
(10,349
)
Other comprehensive loss for the period
   
-
     
-
     
-
     
-
     
(339
)
   
-
     
(339
)
   
(339
)
Employee options exercised
   
*
     
303
     
-
     
-
     
-
     
-
     
303
     
303
 
Share-based compensation
   
-
     
-
     
-
     
-
     
-
     
2,375
     
2,375
     
2,375
 
Balance on June 30, 2022 (unaudited)
   
8
     
150,763
     
102
     
9,503
     
(95
)
   
(43,191
)
   
117,090
     
117,090
 
 
(*) Represents an amount lower than $1 thousand.

15


NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

   
Six months ended
June 30
   
Three months ended
June 30
 
   
2023
   
2022
   
2023
   
2022
 
   
U.S. dollars in thousands
 
CASH FLOWS FROM OPERATING ACTIVITIES:
                       
Net loss for the period
   
(9,500
)
   
(20,129
)
   
(3,973
)
   
(10,349
)
Adjustments to reconcile net loss to net cash provided by (used in) operations (see Appendix A)
   
8,722
     
1,942
     
2,310
     
(4,892
)
Net cash used in operating activities
   
(778
)
   
(18,187
)
   
(1,663
)
   
(15,241
)
                                 
CASH FLOWS FROM INVESTING ACTIVITIES:
                               
Capitalized development costs
   
(7,984
)
   
(6,131
)
   
(4,449
)
   
(3,269
)
Acquisition of property and equipment
   
(274
)
   
(599
)
   
(178
)
   
(410
)
Loans granted to related company
   
(620
)
   
-
     
(620
)
   
-
 
Increase in bank deposits
   
(1,182
)
   
(7,048
)
   
(1,123
)
   
(370
)
Payments for acquisitions of subsidiaries, net of cash acquired
   
-
     
440
     
-
     
440
 
Interest received
   
448
     
35
     
424
     
35
 
Investments in financial assets
   
(97
)
   
(6,686
)
   
(97
)
   
(1,014
)
Proceeds from sub-lessee
   
69
     
-
     
69
     
-
 
Net cash used in investing activities
   
(9,640
)
   
(19,989
)
   
(5,974
)
   
(4,588
)
                                 
CASH FLOWS FROM FINANCING ACTIVITIES:
                               
Interest paid
   
(1,020
)
   
(261
)
   
(745
)
   
(120
)
Changes in short-term bank credit
   
10,874
     
-
     
6,643
     
-
 
Royalties paid in respect to government assistance plans
   
(67
)
   
(36
)
   
(67
)
   
(36
)
Transactions with non-controlling interests
   
-
     
(186
)
   
-
     
-
 
Repayment of long-term bank loans
   
(502
)
   
(1,711
)
   
(248
)
   
(248
)
Repayment of long-term loans from others
   
(2,261
)
   
(1,568
)
   
(1,055
)
   
(626
)
Repayment of other long-term liabilities
   
(136
)
   
(148
)
   
(67
)
   
(73
)
Employee options exercised
   
1,033
     
501
     
937
     
410
 
Principal lease payments
   
(1,063
)
   
(656
)
   
(489
)
   
(205
)
Net cash provided by (used in) financing activities
   
6,858
     
(4,065
)
   
4,909
     
(898
)
                                 
Decrease in cash and cash equivalents
   
(3,560
)
   
(42,241
)
   
(2,728
)
   
(20,727
)
Balance of cash and cash equivalents at beginning of period
   
33,880
     
87,332
     
33,212
     
64,752
 
Gains (losses) from exchange differences on cash and cash equivalents
   
537
     
(3,897
)
   
424
     
(2,618
)
Gains (losses) from translation differences on cash and cash equivalents of foreign activity operations
   
193
     
568
     
142
     
355
 
Balance of cash and cash equivalents at end of period
   
31,050
     
41,762
     
31,050
     
41,762
 

16

NAYAX LTD
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

   
Six months ended
June 30
   
Three months ended
June 30
 
   
2023
   
2022
   
2023
   
2022
 
   
U.S. dollars in thousands
 
Appendix A – adjustments to reconcile net loss to net cash provided by operations:
                       
                         
Adjustments in respect of:
                       
Depreciation and amortization
   
5,783
     
3,936
     
3,156
     
1,932
 
Post-employment benefit obligations, net
   
26
     
(42
)
   
22
     
(19
)
Deferred taxes
   
(72
)
   
(107
)
   
(36
)
   
(53
)
Finance expenses, net
   
(1,018
)
   
2,988
     
(807
)
   
2,034
 
Expenses in respect of long-term employee benefits
   
98
     
91
     
38
     
41
 
Share of loss of equity method investee
   
741
     
1,071
     
383
     
570
 
Long-term deferred income
   
(52
)
   
(52
)
   
(26
)
   
(26
)
Expenses in respect of share-based compensation
   
2,985
     
5,165
     
1,425
     
2,063
 
Total adjustments
   
8,491
     
13,050
     
4,155
     
6,542
 
                                 
Changes in operating asset and liability items:
                               
Decrease (Increase) in restricted cash transferable to customers for processing activity
   
(16,456
)
   
(9,021
)
   
(6,493
)
   
338
 
Increase in receivables from processing activity
   
(7,023
)
   
(7,965
)
   
(4,662
)
   
(2,777
)
Increase in trade receivables
   
(4,949
)
   
(5,851
)
   
(2,517
)
   
(4,784
)
Decrease in other current assets
   
(238
)
   
(7,063
)
   
(1,237
)
   
(7,326
)
Decrease (Increase) in inventory
   
850
     
(10,208
)
   
4,432
     
(7,960
)
Increase in payables in respect of processing activity
   
31,510
     
15,645
     
15,095
     
609
 
Increase (Decrease) in trade payables
   
(2,032
)
   
12,106
     
(4,516
)
   
11,160
 
Increase (Decrease) in other payables
   
(1,431
)
   
1,249
     
(1,947
)
   
(694
)
Total changes in operating asset and liability items
   
231
     
(11,108
)
   
(1,845
)
   
(11,434
)
Total adjustments to reconcile net loss to net cash provided by (used in) operations
   
8,722
     
1,942
     
2,310
     
(4,892
)
                                 
Appendix B – Information regarding investing and financing activities not involving cash flows:
                               
                                 
Purchase of property and equipment in credit
   
2
     
70
     
2
     
70
 
Acquisition of right-of-use assets through lease liabilities
   
338
     
380
     
243
     
0
 
Share based payments costs attributed to development activities, capitalized as intangible assets
   
485
     
470
     
254
     
312
 
Recognition of receivable balance in respect of sub-lease against
derecognition of right-of-use asset in respect of lease of buildings
   
455
     
-
     
455
     
-
 

17


 IFRS to Non-IFRS 

The following is a reconciliation of loss for the period, the most directly comparable IFRS financial measure, to Adjusted EBITDA for each of the periods indicated. 

Quarter ended as of ​
(U.S. dollars in thousands)
​​
Q2 2023
Q2 2022
Loss for the period
(3,973)​​
(10,349)​​
Finance expense, net​​
40​
1,499​
Tax expense​ ​
 226​
235​
Depreciation and amortization ​​
3,156​
1,932​
EBITDA​​
(551)​​
 (6,683) ​​
Expenses in respect of share-based compensation​
1,425​
2,063​
Non-Recurring issuance costs​
-​
866​
Share of loss of equity method investee ​(1)
383​
570​
ADJUSTED EBITDA (2)
1,257
(3,184) ​​

(1) Equity method investee is related to our 2021 investment in Tigapo.   ​
(2) For historical years comparison (2018-2020), when excluding (i) product costs increase due to global components shortage (ii) bonus plan for non-sales employees that was introduced in Q3 2021, Adjusted EBITDA for Q2 2022 and Q2 2023 improved to $1.3M and $2.8M respectively.​

18