Evertec Q1 2025 slides: revenue up 11%, Latin America growth accelerates

Evertec Inc . (NYSE:EVTC) shares rose 4.11% in aftermarket trading following the release of its first quarter 2025 results on May 7, which showed strong growth across key metrics and an improved outlook for the full year.

Quarterly Performance Highlights

The payment processing and financial technology company reported total revenue of $228.8 million for Q1 2025, representing an 11% increase year-over-year, or 15% on a constant currency basis. Adjusted EBITDA rose 14% to $89.4 million, with margins expanding to 39.1%. Adjusted earnings per share climbed 21% to $0.87, significantly outpacing revenue growth.

As shown in the following financial highlights slide, the company generated approximately $37.6 million in operating cash flow and returned $3.2 million to shareholders through dividends:

"We delivered strong results across all our core markets in the first quarter," said Mac Schuessler, President and CEO of Evertec, during the earnings call. "Our diversification strategy continues to pay off, with Latin America now representing a larger portion of our business."

The company’s consolidated results demonstrate consistent improvement across all key financial metrics compared to the same period last year:

Segment Performance Analysis

Evertec’s performance was robust across all segments, with particularly strong results in Latin America and Merchant Acquiring.

The Merchant Acquiring segment delivered 11% revenue growth to $47.6 million, driven by an improved spread, pricing actions, favorable card mix, and higher sales volume. Adjusted EBITDA for this segment surged 26% to $20.4 million, with margins expanding by 510 basis points to 42.7%.

In Puerto Rico, economic indicators remained stable with a low unemployment rate of 5.5% and strong tourism, with airport arrivals up approximately 9%. The Payment Services segment in Puerto Rico and the Caribbean grew more modestly, with revenue increasing 4% to $55.2 million and adjusted EBITDA also up 4% to $31.4 million.

The standout performer was the Latin America Payments and Solutions segment, which saw revenue increase by 13% (22% on a constant currency basis) to $83.8 million. This growth was driven by the GetNet Chile relationship, repricing initiatives, product modernization in Brazil, and contributions from recent acquisitions including Grandata and Nubity. Adjusted EBITDA for this segment surged 53% to $24.9 million, with margins expanding by 780 basis points to 29.7%.

"Our Latin America business continues to show exceptional growth," noted Schuessler. "The investments we’ve made in this region are yielding strong returns, and we see significant opportunities for further expansion."

The Business Solutions segment reported 13% revenue growth to $65.6 million, driven by completed projects and one-time hardware and software sales. However, adjusted EBITDA declined 4% to $22.2 million, with margins contracting by 580 basis points to 33.9% due to a mix shift toward lower-margin hardware and software sales.

Financial Position and Cash Flow

Evertec maintained a strong financial position, ending the quarter with $307.6 million in cash, including restricted cash and settlement assets. The company’s cash flow dynamics for the quarter are illustrated in the following chart:

The company continued to reduce its debt burden, with total debt decreasing to $969.8 million as of March 31, 2025, compared to $1,086.4 million a year earlier. The net debt to adjusted EBITDA ratio improved to 2.04x from 2.5x in the prior year, while the weighted average interest rate decreased to 6.55% from 7.26%.

"Our strong cash flow generation and disciplined capital allocation approach have allowed us to maintain a healthy balance sheet while investing in growth opportunities," said Joaquin Castrillo, Chief Financial Officer of Evertec.

Forward Guidance and Outlook

Based on the strong first quarter performance, Evertec raised its full-year 2025 guidance. The company now expects constant currency revenue of $903 million to $911 million, representing growth of 6.8% to 7.7% (5.2% to 6.1% on a GAAP basis). Adjusted earnings per share is projected to be between $3.44 and $3.53, reflecting growth of 4.9% to 7.6% on a constant currency basis.

This updated guidance represents an increase from the previous outlook provided in the Q4 2024 earnings release, which projected revenue between $889 million and $899 million. The improved outlook reflects continued momentum in Latin America and stable performance in Puerto Rico.

The company also expects adjusted EBITDA margins to remain robust at 39.5% to 40.5% for the full year, with capital expenditures projected at $85 million.

"While we remain cautious about potential impacts from tariffs on consumer confidence and payment volumes, particularly in Latin America, our diverse geographic footprint and product portfolio position us well to navigate any challenges," Schuessler concluded.

Evertec’s stock closed at $34.61 on May 7 before rising to $36.03 in after-hours trading following the earnings release. The stock has traded between $28.76 and $38.32 over the past 52 weeks.

Full presentation:

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