BM Technologies, Inc. (NYSE American: BMTX) (the “Company”), one of
the largest digital banking platforms and Banking-as-a-Service
(BaaS) providers, today reported preliminary first quarter results
for the three months ended March 31, 2022.
The company expects to report EBITDA[1] in excess of $8 million
for the quarter, which exceeds the consensus estimate, and strong
revenues of approximately $25 million. The Company recently
executed a term sheet with a significant new BaaS partner and
expects to finalize a contract over the next approximately 90 days
and provide details over the next few quarters.
PRELIMINARY FIRST QUARTER FINANCIAL AND BUSINESS
HIGHLIGHTS:
- Total revenue of approximately $25 million.
- Net income expected to exceed $2.5 million, which includes $2.9
million of non-cash, share-based compensation expense, $0.3 million
of merger costs, and a $1.7 million gain on the private warrant
liability.
- Core 1Q 2022 EBITDA expected to exceed $8 million, beating the
consensus estimate.
- The Company recently executed a term sheet with a significant
new Banking-as-a-Service (BaaS) partner.
- Average serviced deposits totaled $2.1 billion in Q1 2022; a
60% increase compared to Q1 2021. Average new business serviced
deposits increased $0.7 billion, or 102% compared to Q1 2021 to
$1.5 billion.
- Debit card spend was $0.8 billion in Q1 2022, slightly below Q1
2021’s government stimulus driven peak. New business debit card
spend increased 5% compared to Q1 2021.
- Revenue per 90-day active account increased 20% year over year
to approximately $54 in Q1 2022.
- Approximately 115 thousand new accounts were opened in Q1
2022.
- BMTX has signed agreements with six new colleges and
universities year to date in 2022, providing over 40,000 additional
students access to BankMobile Disbursements and the BankMobile Vibe
checking account. In addition, BMTX has signed four colleges and
universities to its new Vendor Pay offering in 2022, and its first
Vendor Pay school recently went live.
- Our pending merger with First Sound Bank (“FSB”) is on track;
the merger application has been filed and integration plans with
First Sound Bank are ongoing. The merger is expected to close
before year-end.
- The Company had a cash balance in excess of $30 million at
March 31, 2022.
[1] Core EBITDA is a non-GAAP metric that adjusts net income to
exclude interest, tax, depreciation and amortization, non-cash
share-based compensation expense, and non-core items.
In the first quarter of 2022 there is approximately $3
million of depreciation and amortization, $3 million of non-cash
share-based compensation expense, a $2 million gain on the private
warrant liability, $1 million of tax and $0.3 million of merger
costs.
Commenting on the preliminary results, Luvleen Sidhu, BMTX’s
Chair and Chief Executive Officer said, “Coming off of record
results in 2021, we are excited by the continuing momentum in 2022
including the signing of a term sheet with a significant
banking-as-a-service partner. We are actively working towards
completion of our merger with FSB which we expect to close in the
second half of this year. We believe the merger will provide
significant benefits to our combined company in 2023 and beyond.
Additionally, the company exceeded consensus estimates for EBITDA
and finished the quarter strong with revenues of approximately $25
million and EBITDA exceeding $8 million in the first quarter. We
also continue to expect to meet or exceed current consensus EBITDA
estimates.”
On May 10, the company filed its 2021 annual report on form 10K.
At the direction of the Audit Committee, the company has launched
an RFP process to identify a new independent accounting firm. The
company is actively engaged in this process and expects formal
written proposals from several firms based on conversations to
date. The company plans to release full first quarter financials
and file its first quarter 2022 10Q after a new independent
accounting firm is engaged and that firm has performed its first
quarter 2022 review. Additionally, the company is proud to announce
the expansion of its Board with the naming of John Dolan as a new
Director. Mr. Dolan will also serve as chairperson of the
Audit Committee. As a former community bank CEO and CFO, Mr. Dolan
brings to the Board extensive financial and regulatory
expertise.
The Company intends to announce the date and time of its first
quarter earnings conference call in a subsequent press release.
About BM Technologies, Inc.
BM Technologies, Inc. (NYSE American: BMTX)—formerly known as
BankMobile—is among the largest digital banking platforms and
Banking-as-a-Service (BaaS) providers in the country, providing
access to checking and savings accounts, personal loans, credit
cards, and financial wellness. It is focused on technology,
innovation, easy-to-use products, and education with the mission to
financially empower millions of Americans by providing a more
affordable, transparent, and consumer-friendly banking experience.
The BM Technologies (BMTX) digital banking platform employs a
multi-partner distribution model, known as "Banking-as-a-Service"
(BaaS), that enables the acquisition of customers at higher volumes
and substantially lower expense than traditional banks, while
providing significant benefits to its customers, partners, and
business. BM Technologies (BMTX) currently has approximately two
million accounts and provides disbursement services at
approximately 750 college and university campuses (covering one out
of every three college students in the U.S.). BM Technologies, Inc.
(BMTX) is a technology company and is not a bank, which means it
provides banking services through its partner bank. More
information can also be found at www.bmtx.com.
BMTX recently announced the signing of a definitive agreement to
merge with First Sound Bank, a Seattle, Washington-based
business bank. The combined company, to be named BMTX Bank, will be
a fintech-based bank focused on serving customers digitally
nationwide. The transaction is subject to regulatory approvals and
other customary closing conditions and is expected to close in the
second half of 2022.
Non-GAAP Financial Measures
This press release, including the accompanying financial
statement tables, contains financial information determined by
methods other than in accordance with generally accepted accounting
principles, or GAAP. This financial information includes certain
operating performance measures, such as EBITDA and core EBITDA.
These non-GAAP measures are included because the Company believes
they may provide useful supplemental information for evaluating the
Company’s underlying performance trends. These measures should be
viewed in addition to, and not as an alternative to or substitute
for, measures determined in accordance with GAAP, and are not
necessarily comparable to non-GAAP measures that may be presented
by other companies. To the extent applicable, reconciliations of
these non-GAAP measures to the most directly comparable measures as
reported in accordance with GAAP are included in footnote 1 of this
document.
FORWARD LOOKING STATEMENTS
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. In general, forward-looking statements usually may be
identified through use of words such as “may,” “believe,” “expect,”
“anticipate,” “intend,” “will,” “should,” “plan,” “estimate,”
“predict,” “continue” and “potential” or the negative of these
terms or other comparable terminology, and include statements
related to the expected finalization of a contract with a potential
BaaS partner, completion date of the FSB merger and the expected
benefits to the Company of that merger. Forward-looking statements
are not historical facts and represent management’s beliefs, based
upon information available at the time the statements are made,
with regard to the matters addressed; they are not guarantees of
future performance. Actual results may prove to
be materially different from the results expressed or implied
by the forward-looking statements. Forward-looking statements
are subject to numerous assumptions, risks and uncertainties that
change over time and could cause actual results or financial
condition to differ materially from those expressed in or implied
by such statements.
Factors that could cause or contribute to such differences
include, but are not limited to (1) the risk that we are unable to
finalize a contract with the proposed BaaS partner, (2) the
occurrence of any event, change or other circumstances (including
the failure of closing conditions) that could give rise to a delay
in closing the FSB merger or the termination of the merger
agreement, (3) the failure to obtain the necessary approval by the
shareholders of the Company and FSB, (4) the inability to obtain
required governmental approvals of the FSB merger, (5) the
possibility that the costs, fees, expenses and charges related to
the FSB merger may be greater than anticipated, (6) reputational
risk and the reaction of the companies’ customers, suppliers,
employees or other business partners to the merger of the Company
and FSB, (7) the risks relating to the integration of the Company’s
and FSB’s operations, including the risk that such integration will
be materially delayed or will be more costly or difficult than
expected, (8) the risk of potential litigation or regulatory action
related to the merger of the Company and FSBs, Further
information regarding additional factors which could affect the
forward-looking statements contained in this press release can be
found in the cautionary language included under the headings
“Cautionary Note Regarding Forward-Looking Statements” and “Risk
Factors” in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2021, and other documents subsequently filed by
United with the United States Securities and Exchange Commission
(“SEC”).
Many of these factors are beyond the Company’s (and in the case
of the prospective merger with FSB, FSB’s) ability to control or
predict. If one or more events related to these or other risks or
uncertainties materialize, or if the underlying assumptions prove
to be incorrect, actual results may differ materially from the
forward-looking statements. Accordingly, shareholders and investors
should not place undue reliance on any such forward-looking
statements. Any forward-looking statement speaks only as of the
date of this communication, and the Company undertakes no
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law. New risks and uncertainties may emerge
from time to time, and it is not possible for the Company or FSB to
predict their occurrence or how they will affect the Company or
FSB.
The Company qualifies all forward-looking statements by these
cautionary statements.
Important Information About the Proposed Merger and Where to
Find It
This communication is being made in respect of the proposed
Merger involving the Company. In connection with the Merger
described herein, the Company will file relevant materials with the
SEC, including a definitive proxy statement for the Company’s
shareholders. Promptly after filing the definitive proxy statement
with the SEC, the Company will mail the proxy statement and a proxy
card to each shareholder entitled to vote at the special meeting
relating to the transactions. INVESTORS AND SECURITY HOLDERS ARE
URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR
SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION
WITH THE TRANSACTIONS THAT BMTX WILL FILE WITH THE SEC WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE COMPANY, FSB AND THE TRANSACTIONS. The preliminary proxy
statement, the definitive proxy statement and other relevant
materials in connection with the transactions (when they become
available), and any other documents filed by the Company with the
SEC, may be obtained free of charge at the SEC’s website
(www.sec.gov) or by writing to BM Technologies, Inc. at 201 King of
Prussia Road, Suite 350, Wayne, PA 19087.
Participants in Solicitation
The Company and FSB and their respective directors, executive
officers and employees and other persons may be deemed to be
participants in the solicitation of proxies from the holders of the
Company common stock in respect of the proposed transactions.
Information about the Company’s directors and executive officers
and their ownership of the Company’s common stock is set forth in
the Company’s definitive proxy materials filed with the SEC in
connection with its prospective 2022 annual meeting of shareholders
scheduled to take place on June 15, 2022, filed with the SEC on May
2, 2022, as those materials may be amended or supplemented. Other
information regarding the interests of the participants in the
proxy solicitation will be included in the proxy statement
pertaining to the proposed transactions when it becomes available.
These documents can be obtained free of charge from the sources
indicated above.
Investors: Bob Ramsey, CFA
BM Technologies, Inc.
571-236-8851
rramsey@bmtx.com
Media Inquiries: Brigit Hennaman
Rubenstein Public Relations
212-805-3005
bhennaman@rubensteinpr.com
BM Technologies (AMEX:BMTX)
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