Full Year 2023 Financial Highlights

(All comparisons are relative to the twelve-month period ended December 31, 2022, unless otherwise stated)

• Revenue of $235.5 million, an increase of 36% year-over-year; recurring revenue from SaaS and processing fees increased 44% year-over-year, comprising 64% of total revenue.

• Gross margin improved to 37.5% from 34.6% mainly due to higher hardware margins, from 9% to 19%.

• Operating loss reduced to $12.4 million, compared to an operating loss of $34.0 million.

• Loss for the period improved by $21.6 million to $15.9 million or ($0.48) per share for 2023, compared to a net loss of $37.5 million, or ($1.14) per share.

• Adjusted EBITDA improved by $20.9 million to $8.2 million, compared to adjusted EBITDA loss of $12.7 million.

• Generated positive operating cash flow of $8.8 million and ended the year with $38 million in cash and cash equivalents.

• As of December 31, 2023, debt balances stood at $52.8 million, out of which approximately $20 million was used to acquire Retail Pro International.

• Total transaction value grew 54% to $3.65 billion.

• Number of processed transactions increased 41% to 1.84 billion.
  

Fourth Quarter 2023 Financial Highlights

(All comparisons are relative to the three-month period ended December 31, 2022, unless otherwise stated)

• Revenue of $66.6 million, an increase of 31% year-over-year; recurring revenue from SaaS and processing fees increased 43% year-over-year, comprising 63% of total revenue.

^{(*) 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.
(***) Retail Pro P&L results are included for the first time in the fourth quarter of 2023}

• Gross margin improved to 39.9% from 33.4% mainly due to higher hardware margins, from 9% to 24%.

• Operating loss reduced to $2.0 million, compared to an operating loss of $7.4 million.

• Adjusted EBITDA improved by 6.5 million, to $4.0 million, compared to adjusted EBITDA loss of $2.5 million.

• Loss for the period reduced to $3.3 million, or ($0.10) per share, from a loss of $7.5 million or ($0.23) per share.

Fourth Quarter Business and Operational Highlights

• Customer expansion continued at a healthy pace, adding 12,000 new customers in the quarter, bringing the total customer base to over 72,000 as of December 31, 2023, an increase of 53% year-over-year. The number of customers includes 7,500 Retail Pro customers, which were included for the first time in Q4 2023.

• Dollar-based net retention rate remains high at 144%, reflecting strong customer satisfaction, while customer churn rate remained low at 3.4%.

• Nayax added 171,000 managed and connected devices during the quarter, driven by robust customer demand, bringing the total number of managed and connected devices to 1,044,000 as of year-end 2023, a year over year increase of 44%. The number of managed and connected devices includes 130,000 generated by Retail Pro, included for the first time in Q4 2023.

• Total transaction value increased by 43% to $975 million, and number of processed transactions grew by 35% to 511 million.

• On November 30, 2023, we acquired Retail Pro, a global leader in retail POS software with Tier 1 global brand names across the world and an extensive distribution network of over 80+ partner resellers. This transaction will triple our distributor network to over 120 partner resellers and will extend our scale and provide additional meaningful opportunities to cross-sell our payment solutions to Retail Pro’s customer base and their distribution channels.

• Success with Nayax’s new support hub rollout, increasing efficiencies, reducing technical support calls and case times to desired service level agreement (“SLA”).

• License granted for Nayax Financial services (NFS) from the UK FCA. Nayax transferred all UK customers from European licenses to NFS in line with regulation requirements.

• Started introducing Deferred Online functionality in readers on trains of the Deutsche Bahn (German Railways), enabling Nayax to increase card acceptance and sales in tunnels and regions with bad cellular network reception.

Operational Metrics Summary

^{(*) 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. 
(**) Number of managed and connected devices includes 130,000 generated by Retail Pro, included for the first time in Q4 2023.}

Financial Outlook

For the full year 2024, management provided the following outlook:

Revenue is expected to be in the range of $325 million to $335 million (based on constant currency), representing year-over-year organic and inorganic growth of over 38%. Adjusted EBITDA is expected to be in the rangeof$30 to $35 million as Nayax continues to scale its business.

Over the long term, management expects to maintain an approximate 35% CAGR on revenue, driven by organic growth initiatives and strategic M&A. The long-term adjusted EBITDA margin and gross margin target is 30% and 50%, respectively. Improvements over the coming years are expected to be driven by leasing options for IoT POS, growing SaaS revenue and payment processing fees, and emerging growth initiatives.

It is noted that the financial outlook provided by Nayax 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. Please see the cautionary note regarding Forward-looking Statements below.

Conference Calls:

Nayax will host two conference calls and webcasts on February 28, 2023, the first in English and the other in Hebrew to discuss its fourth quarter and full year 2023 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 calls 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=10022962&linkSecurityString=1a935cf038

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

WEBCAST LINK: 
https://viavid.webcasts.com/starthere.jsp?ei=1652425&tp_key=7561fc2df4

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 March 13, 2024. 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: 10022962

An archive of the audio webcast will be available on Nayax's Investor Relations website. 
Nayax - Investor Relations

To access the conference call/webcast in Hebrew, use the link with below:
https://us02web.zoom.us/j/85105523849

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, including ongoing military conflicts in the region; the success of operating initiatives, including advertising and promotional efforts and new product and concept development by us and our competitors; factors relating to the acquisition of Retail Pro International, including but not limited to the financing for and payment of the acquisition and our ability to effectively and efficiently integrate the acquired business into our existing business; and other risk factors discussed under “Risk Factors” in our annual report on Form 20-F filed with the SEC on Feb 28, 2024 (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.

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 and acquisition related 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.

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 2024 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, payments and loyalty platform designed to help merchants scale their business. Nayax offers a complete solution including localized cashless payment acceptance, management suite, and loyalty 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 870 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

^{(1) Equity method investee is related to our 2021 investment in Tigapo and IOT Technologies.}

^{(1)   Consists primarily of (i) fees and expenses, other than underwriter discount and commissions, incurred in connection with our May 2021 initial public offering on the TASE and (ii) expenses incurred in connection with our listing on Nasdaq in September 2022. 
(2)   Share of loss of equity method investee is related to our 2021 investment in Tigapo.  
       Retail Pro P&L figures are included for the first time in Q4.2023.}