Company Quick10K Filing
Evertec
Price30.75 EPS1
Shares74 P/E29
MCap2,261 P/FCF17
Net Debt415 EBIT115
TEV2,676 TEV/EBIT23
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-03-31 Filed 2020-05-11
10-K 2019-12-31 Filed 2020-02-27
10-Q 2019-09-30 Filed 2019-10-31
10-Q 2019-06-30 Filed 2019-08-02
10-Q 2019-03-31 Filed 2019-05-03
10-K 2018-12-31 Filed 2019-02-26
10-Q 2018-09-30 Filed 2018-10-31
10-Q 2018-06-30 Filed 2018-08-02
10-Q 2018-03-31 Filed 2018-05-03
10-K 2017-12-31 Filed 2018-02-28
10-Q 2017-09-30 Filed 2017-11-09
10-Q 2017-06-30 Filed 2017-08-03
10-Q 2017-03-31 Filed 2017-05-05
10-K 2016-12-31 Filed 2017-02-24
10-Q 2016-09-30 Filed 2016-11-03
10-Q 2016-06-30 Filed 2016-08-02
10-K 2016-03-31 Filed 2016-05-26
10-K 2015-12-31 Filed 2016-05-26
10-Q 2015-09-30 Filed 2015-11-06
10-Q 2015-06-30 Filed 2015-08-07
10-Q 2015-03-31 Filed 2015-05-11
10-K 2014-12-31 Filed 2015-03-02
10-Q 2014-09-30 Filed 2014-11-06
10-Q 2014-06-30 Filed 2014-08-07
10-Q 2014-03-31 Filed 2014-05-08
10-K 2013-12-31 Filed 2014-03-17
10-Q 2013-09-30 Filed 2013-11-07
10-Q 2013-06-30 Filed 2013-08-14
10-Q 2013-03-31 Filed 2013-05-15
8-K 2020-05-08 Earnings, Exhibits
8-K 2020-04-21 Regulation FD, Exhibits
8-K 2020-02-25 Earnings, Exhibits
8-K 2020-02-20 Regulation FD, Exhibits
8-K 2019-10-30 Earnings, Exhibits
8-K 2019-10-24 Regulation FD, Exhibits
8-K 2019-07-31 Earnings, Exhibits
8-K 2019-07-26 Regulation FD, Exhibits
8-K 2019-05-24 Officers, Shareholder Vote, Exhibits
8-K 2019-05-01 Earnings, Exhibits
8-K 2019-04-25 Regulation FD, Exhibits
8-K 2019-02-22 Officers
8-K 2019-02-20 Earnings, Exhibits
8-K 2019-02-15 Regulation FD, Exhibits
8-K 2018-12-21 Officers
8-K 2018-11-28 Enter Agreement, Leave Agreement, Off-BS Arrangement, Exhibits
8-K 2018-11-08 Officers
8-K 2018-10-30 Earnings, Exhibits
8-K 2018-10-26 Regulation FD, Exhibits
8-K 2018-10-26 Officers, Exhibits
8-K 2018-08-07 Officers, Exhibits
8-K 2018-07-31 Earnings, Exhibits
8-K 2018-07-26 Regulation FD, Exhibits
8-K 2018-05-24 Shareholder Vote
8-K 2018-05-02 Earnings, Exhibits
8-K 2018-02-21 Earnings, Exhibits

EVTC 10Q Quarterly Report

Note 1 - The Company and Basis of Presentation
Note 2 - Recent Accounting Pronouncements
Note 3 - Current Expected Credit Losses
Note 4 - Property and Equipment, Net
Note 5 - Goodwill and Other Intangible Assets
Note 6 - Debt and Short - Term Borrowings
Note 7 - Financial Instruments and Fair Value Measurements
Note 8 - Equity
Note 9 - Share - Based Compensation
Note 10 - Revenues
Note 11 - Income Tax
Note 12 - Net Income per Common Share
Note 13 - Commitments and Contingencies
Note 14 - Related Party Transactions
Note 15 - Segment Information
Note 16 - Subsequent Events
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-10.1 ex10103312020.htm
EX-31.1 ex31103312020.htm
EX-31.2 ex31203312020.htm
EX-32.1 ex32103312020.htm
EX-32.2 ex32203312020.htm

Evertec Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
1.00.80.60.40.20.02012201420172020
Assets, Equity
0.20.10.10.0-0.0-0.12012201420172020
Rev, G Profit, Net Income
0.10.10.0-0.0-0.1-0.12012201420172020
Ops, Inv, Fin

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549 
 
 
FORM 10-Q
 
 
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2020 or 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                  to                 
COMMISSION FILE NUMBER 001-35872
 
 
 EVERTEC, Inc.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) 
 
  
Puerto Rico
 
66-0783622
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. employer
identification number)
 
 
Cupey Center Building,
Road 176, Kilometer 1.3,
 
 
San Juan,
Puerto Rico
 
00926
(Address of principal executive offices)
 
(Zip Code)
(787759-9999
(Registrant’s telephone number, including area code)
Not applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value per share
EVTC
New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).    Yes      No  



Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company", and "emerging growth company" in Rule 12b-2 of the Exchange Act. 
Large accelerated filer
 
  
Accelerated filer
 
Non-accelerated filer
 
  
Smaller reporting company
 
Emerging growth company
 
 
 
 
 
Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act).    Yes    No  
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
At May 7, 2020, there were 71,865,305 outstanding shares of common stock of EVERTEC, Inc.




TABLE OF CONTENTS
 


 
 
Page
Part I. FINANCIAL INFORMATION
 
Item 1.
Financial Statements
 
 
 
 
 
 
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
















All reports we file with the Securities and Exchange Commission ("SEC") are available free of charge via the Electronic Data Gathering Analysis and Retrieval (EDGAR) System on the SEC’s website at www.sec.gov. We also provide copies of our SEC filings at no charge upon request and make electronic copies of our reports available through our website at www.evertecinc.com as soon as reasonably practicable after filing such material with the SEC.




FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of, and subject to the protection of, the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of forward-looking terminology such as “believes,” “expects,” “may,” “estimates,” “will,” “should,” “plans” or “anticipates” or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and may involve significant risks and uncertainties, and that actual results may vary materially from those in the forward-looking statements as a result of various factors. Among the factors that significantly impact our business and could impact our business in the future are:

our reliance on our relationship with Popular, Inc. (“Popular”) for a significant portion of our revenues pursuant to our master services agreement with them, and to grow our merchant acquiring business;
as a regulated institution, the likelihood we will be required to obtain regulatory approval before engaging in certain new activities or businesses, whether organically or by acquisition, and our potential inability to obtain such approval on a timely basis or at all, which may make transactions more expensive or impossible to complete, or make us less attractive to potential sellers;
our ability to renew our client contracts on terms favorable to us, including our contract with Popular, and any significant concessions we may have to grant to Popular with respect to pricing or other key terms in anticipation of the negotiation of the extension of the MSA, both in respect of the current term and any extension of the MSA;
our dependence on our processing systems, technology infrastructure, security systems and fraudulent payment detection systems, as well as on our personnel and certain third parties with whom we do business, and the risks to our business if our systems are hacked or otherwise compromised;
our ability to develop, install and adopt new software, technology and computing systems;
a decreased client base due to consolidations and failures in the financial services industry;
the credit risk of our merchant clients, for which we may also be liable;
the continuing market position of the ATH network;
a reduction in consumer confidence, whether as a result of a global economic downturn or otherwise, which leads to a decrease in consumer spending;
our dependence on credit card associations, including any adverse changes in credit card association or network rules or fees;
changes in the regulatory environment and changes in international, legal, tax, political, administrative or economic conditions;
the geographical concentration of our business in Puerto Rico, including our business with the government of Puerto Rico and its instrumentalities, which are facing severe political and fiscal challenges;
additional adverse changes in the general economic conditions in Puerto Rico, whether as a result of the government’s debt crisis or otherwise, including the continued migration of Puerto Ricans to the U.S. mainland, which could negatively affect our customer base, general consumer spending, our cost of operations and our ability to hire and retain qualified employees;
a protracted federal government shutdown may affect our financial performance;
operating an international business in Latin America and the Caribbean, in jurisdictions with potential political and economic instability;
our ability to execute our geographic expansion and acquisition strategies, including challenges in successfully acquiring new businesses and integrating and growing acquired businesses;
our ability to protect our intellectual property rights against infringement and to defend ourselves against claims of infringement brought by third parties;
our ability to recruit and retain the qualified personnel necessary to operate our business;
our ability to comply with U.S. federal, state, local and foreign regulatory requirements;
evolving industry standards and adverse changes in global economic, political and other conditions;
our high level of indebtedness and restrictions contained in our debt agreements, including the senior secured credit facilities, as well as debt that could be incurred in the future;
our ability to prevent a cybersecurity attack or breach in our information security;
our ability to generate sufficient cash to service our indebtedness and to generate future profits;
our ability to refinance our debt;
the possibility that we could lose our preferential tax rate in Puerto Rico;
the risk that the counterparty to our interest rate swap agreements fail to satisfy its obligations under the agreement;



uncertainty of the pending debt restructuring process under Title III of the Puerto Rico Oversight, Management and Economic Stability Act (“PROMESA”), as well as actions taken by the government of Puerto Rico or by the PROMESA Board to address the fiscal crisis in Puerto Rico;
the aftermath of Hurricanes Irma and Maria and their continued impact on the economies of Puerto Rico and the Caribbean;
the possibility of future catastrophic hurricanes affecting Puerto Rico and/or the Caribbean, as well as other potential natural disasters;
the nature, timing and amount of any restatement; and
the potential impact of COVID-19 on our revenues, net income and liquidity due to future disruptions in operations as well as the macroeconomic instability caused by the pandemic.

These forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Forward-looking statements should, therefore, be considered in light of various factors, including those set forth under “Item 1A. Risk Factors,” in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Report. These forward-looking statements speak only as of the date of this Report, and we do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Report or to reflect the occurrence of unanticipated events.








EVERTEC, Inc. Unaudited Condensed Consolidated Balance Sheets
(Dollar amounts in thousands, except for share information)

 
 
March 31, 2020
 
December 31, 2019
Assets




Current Assets:




Cash and cash equivalents

$
103,521


$
111,030

Restricted cash

21,583


20,091

Accounts receivable, net

95,305


106,812

Prepaid expenses and other assets

39,904


38,085

Total current assets

260,313


276,018

Investment in equity investee

12,568


12,288

Property and equipment, net

41,984


43,791

Operating lease right-of-use asset
 
28,356

 
29,979

Goodwill

394,498


399,487

Other intangible assets, net

229,787


241,937

Deferred tax asset

3,261


2,131

Net investment in leases
 
554

 
722

Other long-term assets

7,897


5,323

Total assets

$
979,218


$
1,011,676

Liabilities and stockholders’ equity




Current Liabilities:




Accrued liabilities

$
52,652


$
58,160

Accounts payable

28,230


39,165

Unearned income

18,138


20,668

Income tax payable

9,190


6,298

Current portion of long-term debt

14,250


14,250

Current portion of operating lease liability
 
5,740

 
5,773

Total current liabilities

128,200


144,314

Long-term debt

490,844


510,947

Deferred tax liability

2,957


4,261

Unearned income - long term

32,037


28,437

Operating lease liability - long-term
 
22,869

 
24,679

Other long-term liabilities

39,627


27,415

Total liabilities

716,534


740,053

Commitments and contingencies (Note 13)




Stockholders’ equity




Preferred stock, par value $0.01; 2,000,000 shares authorized; none issued




Common stock, par value $0.01; 206,000,000 shares authorized; 71,865,305 shares issued and outstanding at March 31, 2020 (December 31, 2019 - 72,000,261)

719


720

Accumulated earnings

308,491


296,476

Accumulated other comprehensive loss, net of tax

(50,173
)

(30,009
)
Total EVERTEC, Inc. stockholders’ equity

259,037


267,187

Non-controlling interest

3,647


4,436

Total equity

262,684


271,623

Total liabilities and equity

$
979,218


$
1,011,676


The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.


1


EVERTEC, Inc. Unaudited Condensed Consolidated Statements of Income and Comprehensive Income
(Dollar amounts in thousands, except per share information)

 

 
 
Three months ended March 31,
 
 
2020
 
2019
 
 
 
 
 
Revenues (affiliates Note 14)
 
$
121,942

 
$
118,836

 
 
 
 
 
Operating costs and expenses
 
 
 
 
Cost of revenues, exclusive of depreciation and amortization
 
54,067

 
50,019

Selling, general and administrative expenses
 
17,317

 
15,139

Depreciation and amortization
 
17,795

 
16,273

Total operating costs and expenses
 
89,179

 
81,431

Income from operations
 
32,763

 
37,405

Non-operating income (expenses)
 
 
 
 
Interest income
 
363

 
259

Interest expense
 
(6,779
)
 
(7,551
)
Earnings of equity method investment
 
338

 
222

Other income, net
 
108

 
208

Total non-operating expenses
 
(5,970
)
 
(6,862
)
Income before income taxes
 
26,793

 
30,543

Income tax expense
 
4,518

 
3,809

Net income
 
22,275

 
26,734

Less: Net income attributable to non-controlling interest
 
64

 
90

Net income attributable to EVERTEC, Inc.’s common stockholders
 
22,211

 
26,644

Other comprehensive income (loss), net of tax of $1,085 and $384
 
 
 
 
Foreign currency translation adjustments
 
(8,305
)
 
1,965

Loss on cash flow hedges
 
(11,859
)
 
(4,055
)
Total comprehensive income attributable to EVERTEC, Inc.’s common stockholders
 
$
2,047

 
$
24,554

Net income per common share - basic attributable to EVERTEC, Inc.’s common stockholders
 
$
0.31

 
$
0.37

Net income per common share - diluted attributable to EVERTEC, Inc.’s common stockholders
 
$
0.30

 
$
0.36


The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.



2


EVERTEC, Inc. Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity
(Dollar amounts in thousands, except share information)

 
 
 
Number of
Shares of
Common
Stock
 
Common
Stock
 
Additional
Paid-in
Capital
 
Accumulated
Earnings
 
Accumulated 
Other
Comprehensive
Loss
 
Non-Controlling
Interest
 
Total
Stockholders’
Equity
Balance at December 31, 2019
 
72,000,261

 
$
720

 
$

 
$
296,476

 
$
(30,009
)
 
$
4,436

 
$
271,623

Share-based compensation recognized
 

 

 
3,483

 

 

 

 
3,483

Repurchase of common stock
 
(336,022
)
 
(3
)
 
(775
)
 
(6,522
)
 

 

 
(7,300
)
Restricted stock units delivered
 
201,066

 
2

 
(2,708
)
 

 

 

 
(2,706
)
Net income
 

 

 

 
22,211

 

 
64

 
22,275

Cash dividends declared on common stock, $0.05 per share
 

 

 

 
(3,600
)
 

 

 
(3,600
)
Other comprehensive loss
 

 

 

 
 
 
(20,164
)
 
(853
)
 
(21,017
)
Cumulative adjustment for the implementation of ASU 2016-13
 
 
 
 
 
 
 
(74
)
 
 
 
 
 
(74
)
Balance at March 31, 2020
 
71,865,305

 
$
719

 
$

 
$
308,491

 
$
(50,173
)
 
$
3,647

 
$
262,684

 
 
Number of
Shares of
Common
Stock
 
Common
Stock
 
Additional
Paid-in
Capital
 
Accumulated
Earnings
 
Accumulated 
Other
Comprehensive
Loss
 
Non-Controlling
Interest
 
Total
Stockholders’
Equity
Balance at December 31, 2018
 
72,378,710

 
$
723

 
$
5,783

 
$
228,742

 
$
(23,789
)
 
$
4,147

 
$
215,606

Share-based compensation recognized
 

 

 
3,279

 

 

 

 
3,279

Repurchase of common stock
 
(618,573
)
 
(6
)
 
(3,129
)
 
(14,351
)
 

 

 
(17,486
)
Restricted stock units delivered
 
507,308

 
5

 
(5,933
)
 

 

 

 
(5,928
)
Net income
 

 

 

 
26,644

 

 
90

 
26,734

Cash dividends declared on common stock, $0.05 per share
 

 

 

 
(3,617
)
 

 

 
(3,617
)
Other comprehensive loss
 

 

 

 

 
(2,090
)
 

 
(2,090
)
Balance at March 31, 2019
 
72,267,445

 
$
722

 
$

 
$
237,418

 
$
(25,879
)
 
$
4,237

 
$
216,498


The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.



3


EVERTEC, Inc. Unaudited Condensed Consolidated Statements of Cash Flows
(Dollar amounts in thousands) 

 
 
Three months ended March 31,
 
 
2020
 
2019
Cash flows from operating activities


 

Net income

$
22,275

 
$
26,734

Adjustments to reconcile net income to net cash provided by operating activities:


 

Depreciation and amortization

17,795

 
16,273

Amortization of debt issue costs and accretion of discount

621

 
415

Operating lease amortization
 
1,173

 
1,472

Provision for doubtful accounts and sundry losses

104

 
815

Deferred tax benefit

(1,080
)
 
(882
)
Share-based compensation

3,483

 
3,279

Loss on disposition of property and equipment and other intangibles

81

 
22

Earnings of equity method investment

(338
)
 
(222
)
(Increase) decrease in assets:


 

Accounts receivable, net

11,729

 
3,961

Prepaid expenses and other assets

(1,836
)
 
(5,326
)
Other long-term assets

(2,477
)
 
(2,558
)
Increase (decrease) in liabilities:


 

Accrued liabilities and accounts payable

(20,662
)
 
(18,339
)
Income tax payable

3,307

 
191

Unearned income

1,075

 
4,754

Operating lease liabilities
 
(1,409
)
 
(1,281
)
Other long-term liabilities

84

 
31

Total adjustments

11,650

 
2,605

Net cash provided by operating activities

33,925

 
29,339

Cash flows from investing activities


 

Additions to software

(6,055
)
 
(8,917
)
Property and equipment acquired

(3,357
)
 
(5,071
)
Proceeds from sales of property and equipment


 
32

Net cash used in investing activities

(9,412
)
 
(13,956
)
Cash flows from financing activities


 

Statutory withholding taxes paid on share-based compensation

(2,706
)
 
(5,928
)
Net proceeds under short-term borrowings


 
15,000

Repayment of short-term borrowings for purchase of equipment and software

(792
)
 
(34
)
Dividends paid


 
(3,617
)
Repurchase of common stock

(7,300
)
 
(17,486
)
Repayment of long-term debt

(20,560
)
 
(3,563
)
Net cash used in financing activities

(31,358
)
 
(15,628
)
Effect of foreign exchange rate on cash, cash equivalents and restricted cash
 
828

 

Net decrease in cash, cash equivalents and restricted cash

(6,017
)
 
(245
)
Cash, cash equivalents and restricted cash at beginning of the period

131,121

 
86,746

Cash, cash equivalents and restricted cash at end of the period

$
125,104

 
$
86,501

Reconciliation of cash, cash equivalents and restricted cash
 
 
 
 
Cash and cash equivalents
 
$
103,521

 
$
73,183

Restricted cash
 
21,583

 
13,318

Cash, cash equivalents and restricted cash
 
$
125,104

 
$
86,501

Supplemental disclosure of cash flow information:
 
 
 
 
Cash paid for interest
 
$
6,372

 
$
7,390

Cash paid for income taxes
 
2,083

 
3,496

Supplemental disclosure of non-cash activities:
 
 
 
 
Payable due to vendor related to equipment and software acquired
 
1,482

 
893

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

4


Notes to Unaudited Condensed Consolidated Financial Statements


 

5


Note 1 – The Company and Basis of Presentation

The Company

EVERTEC, Inc. (formerly known as Carib Latam Holdings, Inc.) and its subsidiaries (collectively the “Company,” or “EVERTEC”) is a leading full-service transaction processing business in Latin America and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment processing and business process management. The Company provides services across 26 countries in the region. EVERTEC owns and operates the ATH network, one of the leading automated teller machine ("ATM") and personal identification number ("PIN") debit networks in Latin America. In addition, EVERTEC provides a comprehensive suite of services for core bank processing and cash processing in Puerto Rico and technology outsourcing in all the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations and government agencies with solutions that are essential to their operations, enabling them to issue, process and accept transactions securely. EVERTEC's common stock is listed under the ticker symbol "EVTC" on the New York Stock Exchange.

Basis of Presentation

The unaudited condensed consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of the accompanying unaudited condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited condensed consolidated financial statements. Actual results could differ from these estimates.

Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted from these statements pursuant to the rules and regulations of the Securities and Exchange Commission and, accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the Audited Consolidated Financial Statements of the Company for the year ended December 31, 2019, included in the Company’s 2019 Annual Report on Form 10-K. In the opinion of management, the accompanying unaudited condensed consolidated financial statements, prepared in accordance with GAAP, contain all adjustments necessary for a fair presentation. Intercompany accounts and transactions are eliminated in consolidation.

Risks and Uncertainties due to COVID-19 Pandemic

In December 2019, the outbreak of a novel strain of coronavirus ("COVID-19") was reported to have surfaced in Wuhan, China. COVID-19 has since spread to over 100 countries, including every state and territory of the United States. On March 11, 2020, the World Health Organization declared COVID-19 a pandemic, and shortly thereafter, governmental authorities in Puerto Rico and the other countries in which EVERTEC operates declared states of emergency and implemented numerous public health measures to try to contain the virus, including lockdowns and curfews, school and business closures and restrictions on travel. COVID-19 presents material uncertainty and risk with respect to EVERTEC’s business, results of operations and cash flows, as well as with respect to changes in laws and regulations and government and regulatory policy. As the spread of the pandemic persists, entities are experiencing conditions often associated with a general economic downturn. The outbreak has disrupted global financial markets and negatively affected supply and demand across a broad range of industries. COVID-19’s impact on global economies could have a material adverse effect on (among other things) the profitability, capital and liquidity of the Company, particularly if consumer spending levels are depressed for a prolonged period of time. While the rapid development and fluidity of the situation prevents management from having clear visibility into the medium and long-term impacts, management believes possible effects may include, but are not limited to, disruption to the Company’s customers and revenue, absenteeism in the Company’s workforce, unavailability of products and supplies used in operations, and a decline in the value of assets held by the Company, including, among other things, tangible and intangible long-lived assets, and increased levels in the Company's current expected credit loss reserve.

Given the uncertain and rapidly evolving situation, management has taken certain precautionary measures intended to help minimize the risk of COVID-19 to the Company, its employees, and customers, including the following:

The Company deployed its business continuity plan for the entire organization a few days before the government of Puerto Rico enacted a shelter in place directive on March 16, 2020. Since then, every country in which the Company operates has implemented some type of social distancing measures. Management expects that the offices will remain closed for an undetermined period, until it is deemed safe by management to return and as permitted or advised by local authorities in each country where the Company operates;

6


In connection with the Company's business continuity plan, we transitioned most of the Company’s employees to a work from home environment. For certain critical employees who are required to remain working on-site in order to, among other things, maintain network operations oversight functions, cash handling and other critical operations for our customers, we have implemented safety measures including administering daily temperature checks upon entry into the work site, providing protective gear, developing safe social distancing workspaces and increasing overall sanitation at our offices;
As a precautionary measure, to increase the Company's cash position and preserve its financial flexibility in light of the current uncertainty resulting from the COVID-19 outbreak, the Company drew down $30 million on its Senior Secured Revolving Facility on April 8, 2020;
On May 1, 2020, the Company commenced deferral of payroll taxes as permitted under the Coronavirus Aid, Relief, and Economic Security Act of 2020 (the "CARES Act"); management anticipates a $2.7 million deferral of payroll taxes during the allowed time;
Management identified additional expense reductions that are intended to be implemented as necessary; and
Management has suspended all non-essential travel for employees.

While the Company anticipates that the foregoing measures are temporary, management cannot predict their duration, and management may elect or need to take additional precautions as more information related to COVID-19 becomes available, including with respect to employees, customers, and relationships with the Company's business partners. The extent to which the COVID-19 pandemic and EVERTEC’s precautionary measures in response to it, may impact the Company’s business, financial condition or results of operations will depend on the ongoing developments related to the pandemic and its direct and indirect consequences, all of which are highly uncertain and cannot be predicted at this time.

Note 2 – Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board ("FASB") issued updated guidance for the measurement of credit losses on financial instruments, which replaces the incurred loss impairment model with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The main objective of this update and subsequent clarifications and corrections, including ASU 2018-19, ASU 2019-04, ASU 2019-05, and ASU 2020-03, is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The amendments affect the Company's trade receivables. Additional disclosures about significant estimates and credit quality are also required. The Company adopted this new guidance effective January 1, 2020, using a modified retrospective approach through a cumulative-effect adjustment to retained earnings, considered immaterial to the consolidated financial statements. Results for reporting periods beginning after January 1, 2020 are presented under the new guidance provided by Accounting Standards Codification ("ASC") Topic 326, while prior period amounts are not adjusted and continue to be reported under legacy GAAP.

Refer to Note 3, Current Expected Credit Losses, for discussions of the implementation of ASC Topic 326 with respect to the Company’s consolidated financial statements.

In August 2018, the FASB issued updated guidance for customer’s accounting for implementation, set-up and other upfront costs (collectively referred to as implementation costs) incurred in a cloud computing arrangement constituting a service contract. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The updated guidance does not impact the accounting for the service element of a hosting arrangement that is a service contract. The Company adopted this guidance prospectively effective January 1, 2020 with respect to all implementation costs incurred in a cloud computing arrangement constituting a service contract.

In November 2018, the FASB issued updated guidance to clarify the interaction between the guidance for collaborative arrangements and the updated revenue recognition guidance. The amendments in this update, among other things, provide guidance on how to assess whether certain collaborative arrangement transactions should be accounted for under ASC Topic 606, Revenue from Contracts with Customers. The Company adopted the amendments in this update effective January 1, 2020. All contracts after this date will be evaluated under the updated guidance.




7


Recently Issued Accounting Pronouncements

In March 2020, the FASB issued updated guidance for ASC Topic 848, Reference Rate Reform, to provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met for a limited period of time in order to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in this update are elective and apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. The amendments to this update are effective for all entities as of March 12, 2020 through December 31, 2022. The Company is currently evaluating whether to elect the adoption of this guidance with respect to the consolidated financial statements.

Accounting Pronouncements Issued Prior to 2020 and Not Yet Adopted

In December 2019, the FASB issued updated guidance for ASC Topic 740, Income Taxes, as part of its initiative to reduce complexity in accounting standards. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles set out in ASC Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of ASC Topic 740 by clarifying and amending existing guidance. The amendments to this update are effective for fiscal years, and interim periods within such fiscal years, beginning after December 15, 2020. Early adoption of the amendments is permitted, including adoption in any interim period for public business entities for periods for which financial statements have not yet been issued. An entity that elects to early adopt the amendments in an interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period. Additionally, an entity that elects early adoption must adopt all the amendments in the same period. The Company is currently evaluating the impact, if any, of the adoption of this guidance on the consolidated financial statements.

Note 3 - Current Expected Credit Losses

Allowance for Current Expected Credit Losses

The Company has only one type of financial asset that is subject to the expected credit loss model, which is trade receivables for contracts with customers. While contract assets and net investments in leases are also subject to the impairment requirements of ASC Topic 326, the impairment loss identified for these financial assets is immaterial to the consolidated financial statements.

To measure expected credit losses, trade receivables are grouped based on shared risk characteristics (i.e., the relevant industry sector and customer's geographical location) and days past due (i.e., delinquency status), while considering the following:

Customers in the same geographical location share similar risk characteristics associated with the macroeconomic environment of their country.
The Company has two main industry sectors: private and governmental. The private pool is comprised mainly of leading financial institutions, merchants and corporations, while the governmental pool by government agencies. The governmental customers possess different risk characteristics than private customers because although all invoices are due every 30 days, governmental customers usually pay within 60 to 90 days after issuance (i.e., between 30 to 60 more days than private customers). The Company provides to its customers a broad range of merchant acquiring, payment services and business process management services, which constitute mission-critical technology solutions enabling customers to issue, process and accept transactions securely.
The expected credit loss rate is likely to increase as receivables move to older aging buckets. The Company used the following aging categories to estimate the risk of delinquency status: (i) 0 days past due; (ii) 1-30 days past due; (iii) 31-60 days past due; (iv) 61-90 days past due; and (v) over 90 days past due.

The credit losses of the Company’s trade receivables have been historically low and most balances are collected within one year. Therefore, the Company determined that the expected loss rates should be calculated using the historical loss rates adjusted by macroeconomic factors. The historical rates are calculated for each of the aging categories used for pooling trade receivables. To determine the collected portion of each bucket, the collection time of each trade receivable is identified, as well as, the proportion of outstanding balances per aging bucket that ultimately was never collected. This is used to determine the expectation of losses based on the history of uncollected trade receivables once the specific past due period is surpassed. The historical rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability

8


of customers to settle the receivables by applying a country risk premium as the forward-looking macroeconomic factor. Specific reserves are established for certain customers for which collection is doubtful.

Rollforward of the Allowance for Expected Current Credit Losses

The activity in the allowance for expected current credit losses on trade receivables during the period from January 1, 2020 to March 31, 2020, was as follows:
(In thousands)
 
March 31, 2020
Balance at beginning of period
 
$
3,460

Current period provision for expected credit losses
 
(19
)
Write-offs
 
(1,386
)
Recoveries of amounts previously written-off
 
3

Balance at end of period
 
$
2,058



The Company does not have a delinquency threshold for writing-off trade receivables. Potential write-offs of trade receivables are discussed in the Reserve Committee, which is responsible for the review and approval of write-offs.

Impairment losses on trade receivables are presented as net impairment losses within cost of revenue, exclusive of depreciation and amortization in the unaudited condensed consolidated statement of income and comprehensive income. Subsequent recoveries of amounts previously written-off are credited against the allowance for expected current credit losses within accounts receivable, net on the unaudited condensed consolidated balance sheet.
Note 4 – Property and Equipment, net
Property and equipment, net consists of the following:
(Dollar amounts in thousands)
 
Useful life
in years
 
March 31, 2020
 
December 31, 2019
Buildings
 
30
 
$
1,497

 
$
1,542

Data processing equipment
 
3 - 5
 
119,428

 
116,950

Furniture and equipment
 
3 - 20
 
6,660

 
6,936

Leasehold improvements
 
5 -10
 
3,007

 
2,814

 
 
 
 
130,592

 
128,242

Less - accumulated depreciation and amortization
 
 
 
(89,916
)
 
(85,780
)
Depreciable assets, net
 
 
 
40,676

 
42,462

Land
 
 
 
1,308

 
1,329

Property and equipment, net
 
 
 
$
41,984

 
$
43,791


Depreciation and amortization expense related to property and equipment for the three months ended March 31, 2020 amounted to $4.2 million compared to $4.0 million for the corresponding period in 2019.

Note 5 – Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill, allocated by operating segments, were as follows (see Note 15):
(In thousands)
 
Payment
Services -
Puerto Rico & Caribbean
 
Payment
Services -
Latin America
 
Merchant
Acquiring, net
 
Business
Solutions
 
Total
Balance at December 31, 2019
 
$
160,972

 
$
54,571

 
$
138,121

 
$
45,823

 
$
399,487

Foreign currency translation adjustments
 

 
(4,989
)
 

 

 
(4,989
)
Balance at March 31, 2020
 
$
160,972

 
$
49,582

 
$
138,121

 
$
45,823

 
$
394,498



Goodwill is tested for impairment on an annual basis as of August 31, or more often if events or changes in circumstances indicate there may be impairment. The Company may test for goodwill impairment using a qualitative or a quantitative

9


analysis. In the quantitative analysis, the Company compares the estimated fair value of the reporting units to their carrying values, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired. If the fair value does not exceed the carrying value, an impairment loss is recorded for the excess of the carrying value over the fair value, limited to the recorded balance of goodwill. In the first quarter of 2020, global equity markets conditions deteriorated in reaction to the COVID-19 pandemic resulting in a corresponding decrease in the Company's stock price and market capitalization. As a result, management performed assessments as to whether the fair value of reporting units was less than carrying value as of March 31, 2020 and concluded that it was more likely than not that the fair value continued to be in excess of the carrying value for all reporting units. No impairment losses were recognized as of March 31, 2020.

The carrying amount of other intangible assets at March 31, 2020 and December 31, 2019 was as follows:
 
 
 
 
March 31, 2020
(Dollar amounts in thousands)
 
Useful life in years
 
Gross
amount
 
Accumulated
amortization
 
Net carrying
amount
Customer relationships
 
8 - 14
 
$
343,557

 
$
(226,905
)
 
$
116,652

Trademarks
 
10 - 15
 
41,874

 
(33,360
)
 
8,514

Software packages
 
3 - 10
 
259,121

 
(175,230
)
 
83,891

Non-compete agreement
 
15
 
56,539

 
(35,809
)
 
20,730

Other intangible assets, net
 
 
 
$
701,091

 
$
(471,304
)
 
$
229,787

 
 
 
 
December 31, 2019
(Dollar amounts in thousands)
 
Useful life in years
 
 Gross
amount
 
Accumulated
amortization
 
Net carrying
amount
Customer relationships
 
8 - 14
 
$
344,883

 
$
(220,434
)
 
$
124,449

Trademarks
 
2 - 15
 
42,025

 
(32,456
)
 
9,569

Software packages
 
3 - 10
 
256,220

 
(169,974
)
 
86,246

Non-compete agreement
 
15
 
56,539

 
(34,866
)
 
21,673

Other intangible assets, net
 
 
 
$
699,667

 
$
(457,730
)
 
$
241,937



Amortization expense related to other intangibles for the three months ended March 31, 2020 amounted to $13.6 million compared to $12.2 million for the corresponding period in 2019.

The estimated amortization expense of the balances outstanding at March 31, 2020 for the next five years is as follows:
(Dollar amounts in thousands)
Remaining 2020
 
$
37,989

2021
 
46,130

2022
 
40,887

2023
 
36,191

2024
 
28,071


















10


Note 6 – Debt and Short-Term Borrowings

Total debt at March 31, 2020 and December 31, 2019 follows:
(In thousands)
 
March 31, 2020
 
December 31, 2019
2023 Term A Loan paying interest at a variable interest rate (LIBOR plus applicable margin(1)(2))
 
$
196,693

 
$
207,261

2024 Term B Loan paying interest at a variable interest rate (LIBOR plus applicable margin(1)(3))
 
308,401

 
317,936

Note payable due April 30, 2021(1)
 
143

 
175

Note payable due January 1, 2022(1)
 
1,339

 
2,231

Total debt
 
$
506,576

 
$
527,603

 
 
(1)
Net of unaccreted discount and unamortized debt issue costs, as applicable.
(2)
Applicable margin of 2.00% at March 31, 2020 and December 31, 2019.
(3)
Subject to a minimum rate ("LIBOR floor") of 0% plus applicable margin of 3.50% at March 31, 2020 and December 31, 2019.

Secured Credit Facilities

On November 27, 2018, EVERTEC and EVERTEC Group (“Borrower”) entered into a credit agreement providing for the secured credit facilities, consisting of a $220.0 million term loan A facility that matures on November 27, 2023 (the “2023 Term A Loan"), a $325.0 million term loan B facility that matures on November 27, 2024 (the “2024 Term B Loan”), and a $125.0 million revolving credit facility (the “Revolving Facility”) that matures on November 27, 2023, with a syndicate of lenders and Bank of America, N.A. (“Bank of America”), as administrative agent, collateral agent, swingline lender and line of credit issuer (collectively the “2018 Credit Agreement”).

The 2018 Credit Agreement requires mandatory repayment of outstanding principal balances based on a percentage of excess cash flow, provided that no such payment shall be due if the resulting amount of the excess cash flow multiplied by the applicable percentage is less than $10 million. On March 5, 2020, the Company repaid $17.0 million as a result of excess cash flows for the year ended December 31, 2019.

The unpaid principal balance at March 31, 2020 of the 2023 Term A Loan and the 2024 Term B Loan was $198.3 million and $311.9 million, respectively. The additional borrowing capacity under our Revolving Facility at March 31, 2020 was $116.9 million. The Company issues letters of credit against the Revolving Facility which reduce the additional borrowing capacity of the Revolving Facility.

Notes Payable

In December 2019, EVERTEC Group entered into two non-interest bearing financing agreements amounting to $2.4 million to purchase software and maintenance. As of March 31, 2020 and December 31, 2019, the outstanding principal balance of the notes payable was $1.5 million and $2.4 million, respectively. The current portion of these notes, which totaled $0.8 million at March 31, 2020, is included in accounts payable and the long-term portion is included in other long-term liabilities in the Company's unaudited condensed consolidated balance sheet.

Interest Rate Swaps

As of March 31, 2020, the Company has two interest rate swap agreements, entered into in December 2015 and December 2018, which convert a portion of the interest rate payments on the Company's 2024 Term B Loan from variable to fixed: 
Swap Agreement
 
Effective date
  
Maturity Date
  
Notional Amount
  
Variable Rate
  
Fixed Rate
2015 Swap
 
January 2017
  
April 2020
  
$200 million
  
1-month LIBOR
  
1.9225%
2018 Swap
 
April 2020
 
November 2024
 
$250 million
 
1-month LIBOR
 
2.89%


The Company has accounted for these agreements as cash flow hedges.


11


As of March 31, 2020 and December 31, 2019, the carrying amount of derivatives included in other long-term liabilities on the Company's unaudited condensed consolidated balance sheets was $27.4 million and $14.5 million, respectively. The fair value of these derivatives is estimated using Level 2 inputs in the fair value hierarchy on a recurring basis. Refer to Note 8 for disclosure of losses recorded on cash flow hedging activities.

During the three months ended March 31, 2020, the Company reclassified gains of $0.2 million from accumulated other comprehensive loss into interest expense. Based on current LIBOR rates, the Company expects to reclassify losses of $4.7 million from accumulated other comprehensive loss into interest expense over the next 12 months.

The cash flow hedges are considered highly effective.

Note 7 – Financial Instruments and Fair Value Measurements

Recurring Fair Value Measurements

The Company's interest rate swaps are the only financial instruments measured at fair value on a recurring basis. The fair value is estimated using Level 2 inputs under the fair value hierarchy. These derivatives were on a liability position with balances of $27.4 million and $14.5 million as of March 31, 2020 and December 31, 2019, respectively.

The following table presents the carrying value, as applicable, and estimated fair values for financial instruments at March 31, 2020 and December 31, 2019:
 
 
March 31, 2020
 
December 31, 2019
(In thousands)
 
Carrying
Amount
 
Fair
Value
 
Carrying
Amount
 
Fair
Value
Financial liabilities:
 
 
 
 
 
 
 
 
Interest rate swap
 
$
27,401

 
$
27,401

 
$
14,452

 
$
14,452

2023 Term A Loan
 
196,693

 
185,366

 
207,261

 
206,388

2024 Term B Loan
 
308,401

 
264,108

 
317,936

 
324,163



The fair values of the term loans at March 31, 2020 and December 31, 2019 were obtained using prices provided by third party service providers. Their pricing is based on various inputs such as market quotes, recent trading activity in a non-active market or imputed prices. These inputs are considered Level 3 inputs under the fair value hierarchy. Future estimates of fair value may be negatively impacted by market reactions to COVID-19. Also, the pricing may include the use of an algorithm that could take into account movements in the general high yield market, among other variants.


Note 8 – Equity

Accumulated Other Comprehensive Loss

The following table provides a summary of the changes in the balances of accumulated other comprehensive loss for the three months period ended March 31, 2020
(In thousands)
 
Foreign Currency
Translation
Adjustments
 
Cash Flow Hedges
 
Total
Balance - December 31, 2019, net of tax
 
$
(16,872
)
 
$
(13,137
)
 
$
(30,009
)
Other comprehensive loss before reclassifications
 
(8,305
)
 
(12,050
)
 
(20,355
)
Effective portion reclassified to net income
 

 
191

 
191

Balance - March 31, 2020, net of tax
 
$
(25,177
)
 
$
(24,996
)
 
$
(50,173
)


Note 9 – Share-based Compensation

Long-term Incentive Plan ("LTIP")

In the first quarter of 2018, 2019 and 2020, the Compensation Committee of the Company's Board of Directors ("Board") approved grants of restricted stock units (“RSUs”) to executives and certain employees pursuant to the 2018 LTIP, 2019 LTIP

12


and 2020 LTIP, respectively, all under the terms of the Company's 2013 Equity Incentive Plan. Under the LTIPs, the Company granted restricted stock units to eligible participants as time-based awards and/or performance-based awards.

The vesting of the RSUs is dependent upon service, market, and/or performance conditions as defined in the grants. Employees that received time-based awards with service conditions are entitled to receive a specific number of shares of the Company’s common stock on the vesting date if the employee is providing services to the Company on the vesting date. Time-based awards vest over a period of three years in substantially equal installments commencing on the grant date and ending on February 28 of each year for the 2018 LTIP, February 22 of each year for the 2019 LTIP, and February 27 of each year for the 2020 LTIP.

For the performance-based awards under the 2018 LTIP, 2019 LTIP, and 2020 LTIP, the Compensation Committee established adjusted earnings before income taxes, depreciation and amortization ("Adjusted EBITDA") as the primary performance measure while maintaining focus on total shareholder return through the use of a market-based total shareholder return ("TSR") performance modifier. The TSR modifier adjusts the shares earned based on the core Adjusted EBITDA performance upwards or downwards (+/- 25%) based on the Company’s relative TSR at the end of the three-year performance period as compared to the companies in the Russell 2000 Index. The Adjusted EBITDA performance measure will be calculated for the one-year period commencing on January 1 of the year of the grant and ending on December 31 of the same year, relative to the goals set by the Compensation Committee for this same period. The shares earned will be subject to an additional two-year service vesting period.

Performance and market-based awards vest at the end of the performance period that commenced on February 28, 2018 for the 2018 LTIP, February 22, 2019 for the 2019 LTIP, and February 27, 2020 for the 2020 LTIP. The periods end on February 28, 2021 for the 2018 LTIP, February 22, 2022 for the 2019 LTIP and February 27, 2023 for the 2020 LTIP. Unless otherwise specified in the award agreement, or in an employment agreement, awards are forfeited if the employee voluntarily ceases to be employed by the Company prior to vesting.

The following table summarizes nonvested restricted shares and RSUs activity for the three months ended March 31, 2020:
Nonvested restricted shares and RSUs
 
Shares
 
Weighted-average
grant date fair value
Nonvested at December 31, 2019
 
1,592,755

 
$
20.71

Forfeited
 
(139,854
)
 
19.26

Vested
 
(305,531
)
 
19.84

Granted
 
378,135

 
31.84

Nonvested at March 31, 2020
 
1,525,505

 
$
23.77



For the three months ended March 31, 2020, the Company recognized $3.5 million of share-based compensation expense, compared with $3.3 million for the corresponding period in 2019.

As of March 31, 2020, the maximum unrecognized cost for restricted stock and RSUs was $26.3 million. The cost is expected to be recognized over a weighted average period of 2.3 years.

Note 10 - Revenues

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers into primary geographical markets, nature of the products and services, and timing of transfer of goods and services. The Company's operating segments are determined by the nature of the products and services the Company provides and the primary geographical markets in which the Company operates. Revenue disaggregated by segment is discussed in Note 15, Segment Information.

In the following tables, revenue for each segment is disaggregated by timing of revenue recognition for the periods indicated.

13


 
Three months ended March 31, 2020
(In thousands)
Payment Services - Puerto Rico & Caribbean
 
Payment Services - Latin America
 
Merchant Acquiring, net
 
Business Solutions
 
Total
Timing of revenue recognition
 
 
 
 
 
 
 
 
 
Products and services transferred at a point in time
$
5

 
$
431

 
$

 
$
297

 
$
733

Products and services transferred over time
20,633

 
19,809

 
25,121

 
55,646

 
121,209

 
$
20,638

 
$
20,240

 
$
25,121

 
$
55,943

 
$
121,942


 
Three months ended March 31, 2019
(In thousands)
Payment Services - Puerto Rico & Caribbean

Payment Services - Latin America

Merchant Acquiring, net

Business Solutions

Total
Timing of revenue recognition









Products and services transferred at a point in time
$
2,677


$