Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 18, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-35872 | ||
Entity Registrant Name | EVERTEC, Inc. | ||
Entity Incorporation, State or Country Code | PR | ||
Entity Tax Identification Number | 66-0783622 | ||
Entity Address, Address Line One | Cupey Center Building, | ||
Entity Address, Address Line Two | Road 176, Kilometer 1.3, | ||
Entity Address, City or Town | San Juan, | ||
Entity Address, Country | PR | ||
Entity Address, Postal Zip Code | 00926 | ||
City Area Code | 787 | ||
Local Phone Number | 759-9999 | ||
Title of 12(b) Security | Common Stock, $0.01 par value per share | ||
Trading Symbol | EVTC | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2,628,353,889 | ||
Entity Common Stock, Shares Outstanding (in shares) | 71,969,856 | ||
Documents Incorporated by Reference | Specifically identified portions of the registrant's definitive Proxy Statement relating to its 2022 Annual Meeting of Shareholders are incorporated by reference in Part III. | ||
Entity Central Index Key | 0001559865 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Audit Information [Abstract] | |
Auditor Firm ID | 34 |
Auditor Name | Deloitte & Touche LLP |
Auditor Location | San Juan, Puerto Rico |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current Assets: | ||
Cash and cash equivalents | $ 266,351 | $ 202,649 |
Restricted cash | 19,566 | 18,456 |
Accounts receivable, net | 113,285 | 95,727 |
Prepaid expenses and other assets | 37,148 | 42,214 |
Total current assets | 436,350 | 359,046 |
Debt securities available-for-sale, at fair value | 3,041 | 0 |
Investment in equity investee | 12,054 | 12,835 |
Property and equipment, net | 48,533 | 43,538 |
Operating lease right-of-use asset | 21,229 | 27,538 |
Goodwill | 393,318 | 397,670 |
Other intangible assets, net | 213,288 | 219,909 |
Deferred tax asset | 6,910 | 5,730 |
Net investment in lease | 107 | 301 |
Other long-term assets | 9,926 | 6,012 |
Total assets | 1,144,756 | 1,072,579 |
Current Liabilities: | ||
Accrued liabilities | 74,540 | 58,033 |
Accounts payable | 28,484 | 43,348 |
Contract liability | 17,398 | 24,958 |
Income tax payable | 7,132 | 6,573 |
Current portion of long-term debt | 19,750 | 14,250 |
Current portion of operating lease liability | 5,580 | 5,830 |
Total current liabilities | 152,884 | 152,992 |
Long-term debt | 444,785 | 481,041 |
Deferred tax liability | 2,369 | 2,748 |
Contract liability - long term | 36,258 | 31,336 |
Operating lease liability - long-term | 16,456 | 22,402 |
Derivative liability | 13,392 | 25,578 |
Other long-term liabilities | 8,344 | 14,053 |
Total liabilities | 674,488 | 730,150 |
Commitments and contingencies (Note 23) | ||
Stockholders’ equity | ||
Preferred stock, par value $0.01; 2,000,000 shares authorized; none issued | 0 | 0 |
Common stock, par value $0.01; 206,000,000 shares authorized; 71,969,856 shares issued and outstanding at December 31, 2021 (December 31, 2020 - 72,137,678) | 719 | 721 |
Additional paid-in capital | 7,565 | 5,340 |
Accumulated earnings | 506,051 | 379,934 |
Accumulated other comprehensive loss, net of tax | (48,123) | (48,254) |
Total EVERTEC, Inc. stockholders’ equity | 466,212 | 337,741 |
Non-controlling interest | 4,056 | 4,688 |
Total equity | 470,268 | 342,429 |
Total liabilities and equity | $ 1,144,756 | $ 1,072,579 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 206,000,000 | 206,000,000 |
Common stock, issued (in shares) | 71,969,856 | 72,137,678 |
Common stock, outstanding (in shares) | 71,969,856 | 72,137,678 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | |||
Revenues (affiliates Note 22) | $ 589,796 | $ 510,588 | $ 487,374 |
Operating costs and expenses | |||
Cost of revenues, exclusive of depreciation and amortization shown below | 250,164 | 226,870 | 213,379 |
Selling, general and administrative expenses | 68,048 | 70,808 | 61,411 |
Depreciation and amortization | 75,070 | 71,518 | 68,082 |
Total operating costs and expenses | 393,282 | 369,196 | 342,872 |
Income from operations | 196,514 | 141,392 | 144,502 |
Non-operating income (expenses) | |||
Interest income | 1,889 | 1,502 | 1,217 |
Interest expense | (22,810) | (25,074) | (28,811) |
Earnings of equity method investment | 1,713 | 1,136 | 936 |
Other income (expenses) | 4,399 | 4,897 | (1,169) |
Total non-operating expenses | (14,809) | (17,539) | (27,827) |
Income before income taxes | 181,705 | 123,853 | 116,675 |
Income tax expense | 20,562 | 19,002 | 12,975 |
Net income | 161,143 | 104,851 | 103,700 |
Less: Net income attributable to non-controlling interest | 13 | 415 | 231 |
Net income attributable to EVERTEC, Inc.’s common stockholders | 161,130 | 104,436 | 103,469 |
Other comprehensive (loss) income, net of tax of $1,153, $792 and $1,070 | |||
Foreign currency translation adjustments | (11,129) | (7,970) | 4,754 |
Gain (loss) on cash flow hedges | 11,151 | (10,275) | (10,974) |
Unrealized gain on change in fair value of debt securities available-for-sale | 109 | 0 | 0 |
Total comprehensive income attributable to EVERTEC, Inc.’s common stockholders | $ 161,261 | $ 86,191 | $ 97,249 |
Net income per common share - basic attributable to EVERTEC, Inc.’s common stockholders (in dollar per share) | $ 2.24 | $ 1.45 | $ 1.44 |
Net income per common share - diluted attributable to EVERTEC, Inc.’s common stockholders (in dollar per share) | $ 2.21 | $ 1.43 | $ 1.41 |
Consolidated Statements of In_2
Consolidated Statements of Income and Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | |||
Other comprehensive (loss) income, net of tax | $ 1,153 | $ 792 | $ 1,070 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-in Capital | Accumulated Earnings | Accumulated EarningsCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | Non-Controlling Interest |
Beginning balance (in shares) at Dec. 31, 2018 | 72,378,710 | |||||||
Beginning balance at Dec. 31, 2018 | $ 215,606 | $ 723 | $ 5,783 | $ 228,742 | $ (23,789) | $ 4,147 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation recognized | $ 13,570 | 13,570 | ||||||
Repurchase of common stock (in shares) | (1,100,000) | (1,104,389) | ||||||
Repurchase of common stock | $ (31,822) | $ (11) | (10,496) | (21,315) | ||||
Restricted stock units delivered (in shares) | 725,940 | |||||||
Restricted stock units delivered | (8,849) | $ 8 | (8,857) | |||||
Net income | 103,700 | 103,469 | 231 | |||||
Cash dividends declared on common stock, $0.20 per share | (14,420) | (14,420) | ||||||
Other comprehensive loss | (6,162) | (6,220) | 58 | |||||
Ending balance (in shares) at Dec. 31, 2019 | 72,000,261 | |||||||
Ending balance at Dec. 31, 2019 | 271,623 | $ (74) | $ 720 | 0 | 296,476 | $ (74) | (30,009) | 4,436 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation recognized | $ 14,253 | 14,253 | ||||||
Repurchase of common stock (in shares) | (300,000) | (336,022) | ||||||
Repurchase of common stock | $ (7,300) | $ (3) | (775) | (6,522) | ||||
Restricted stock units delivered (in shares) | 473,439 | |||||||
Restricted stock units delivered | (8,134) | $ 4 | (8,138) | |||||
Net income | 104,851 | 104,436 | 415 | |||||
Cash dividends declared on common stock, $0.20 per share | (14,382) | (14,382) | ||||||
Other comprehensive loss | $ (18,408) | (18,245) | (163) | |||||
Ending balance (in shares) at Dec. 31, 2020 | 72,137,678 | 72,137,678 | ||||||
Ending balance at Dec. 31, 2020 | $ 342,429 | $ 721 | 5,340 | 379,934 | (48,254) | 4,688 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation recognized | $ 14,799 | 14,799 | ||||||
Repurchase of common stock (in shares) | (600,000) | (614,288) | ||||||
Repurchase of common stock | $ (24,388) | $ (6) | (5,080) | (19,302) | ||||
Restricted stock units delivered (in shares) | 446,466 | |||||||
Restricted stock units delivered | (8,792) | $ 4 | (7,494) | (1,302) | ||||
Net income | 161,143 | 161,130 | 13 | |||||
Cash dividends declared on common stock, $0.20 per share | (14,409) | (14,409) | ||||||
Other comprehensive loss | $ (514) | 131 | (645) | |||||
Ending balance (in shares) at Dec. 31, 2021 | 71,969,856 | 71,969,856 | ||||||
Ending balance at Dec. 31, 2021 | $ 470,268 | $ 719 | $ 7,565 | $ 506,051 | $ (48,123) | $ 4,056 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | |||
Cash dividends declared per share (in dollar per share) | $ 0.20 | $ 0.20 | $ 0.20 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities | |||
Net income | $ 161,143 | $ 104,851 | $ 103,700 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 75,070 | 71,518 | 68,082 |
Amortization of debt issue costs and accretion of discount | 1,877 | 1,987 | 2,988 |
Operating lease amortization | 5,860 | 5,877 | 6,161 |
Provision for doubtful accounts and sundry losses | 1,859 | 1,726 | 3,939 |
Deferred tax benefit | (2,826) | (3,905) | (6,391) |
Share-based compensation | 14,799 | 14,253 | 13,570 |
Gain from sale of assets | (778) | 0 | 0 |
Loss on disposition of property and equipment and other intangibles | 1,694 | 807 | 893 |
Earnings of equity method investment | (1,713) | (1,136) | (936) |
Dividend received from equity method investment | 1,183 | 0 | 485 |
(Increase) decrease in assets: | |||
Accounts receivable | (18,521) | 8,397 | (7,851) |
Prepaid expenses and other assets | 4,322 | (4,158) | (8,770) |
Other long-term assets | (3,519) | (611) | (1,750) |
Increase (decrease) in liabilities: | |||
Accounts payable and accrued liabilities | (394) | (4,032) | (215) |
Income tax payable | (359) | 195 | (596) |
Unearned income | (1,738) | 6,891 | 11,504 |
Operating lease liabilities | (4,869) | (5,936) | (6,055) |
Other long-term liabilities | (4,670) | 2,365 | 1,191 |
Total adjustments | 67,277 | 94,238 | 76,249 |
Net cash provided by operating activities | 228,420 | 199,089 | 179,949 |
Cash flows from investing activities | |||
Additions to software | (41,804) | (31,558) | (36,871) |
Acquisitions, net of cash acquired | (14,750) | 0 | (5,585) |
Property and equipment acquired | (25,103) | (17,082) | (23,002) |
Proceeds from sales of property and equipment | 805 | 6 | 111 |
Acquisition of available-for-sale debt securities | (2,968) | 0 | 0 |
Net cash used in investing activities | (83,820) | (48,634) | (65,347) |
Cash flows from financing activities | |||
Repayments of borrowings for purchase of equipment and software | (1,651) | (1,553) | (886) |
Dividends paid | (14,409) | (14,382) | (14,420) |
Withholding taxes paid on share-based compensation | (8,793) | (8,134) | (8,849) |
Repurchase of common stock | (24,388) | (7,300) | (31,822) |
Repayment of long-term debt | (32,044) | (31,248) | (14,250) |
Net cash used in financing activities | (81,285) | (62,617) | (70,227) |
Effect of foreign exchange rate on cash, cash equivalents and restricted cash | 1,497 | 2,146 | 0 |
Net increase in cash, cash equivalents and restricted cash | 64,812 | 89,984 | 44,375 |
Cash, cash equivalents and restricted cash at beginning of the period | 221,105 | 131,121 | 86,746 |
Cash, cash equivalents and restricted cash at end of the period | 285,917 | 221,105 | 131,121 |
Reconciliation of cash, cash equivalents and restricted cash | |||
Cash and cash equivalents | 266,351 | 202,649 | 111,030 |
Restricted cash | 19,566 | 18,456 | 20,091 |
Cash, cash equivalents and restricted cash | 285,917 | 221,105 | 131,121 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 21,695 | 23,787 | 28,233 |
Cash paid for income taxes | 25,724 | 22,668 | 18,703 |
Supplemental disclosure of non-cash activities: | |||
Payable due to vendor related to property and equipment and software acquired | $ 757 | $ 1,561 | $ 2,622 |
The Company and Summary of Sign
The Company and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
The Company and Summary of Significant Accounting Policies | The Company and Summary of Significant Accounting Policies The Company EVERTEC, 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 services. 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 the Caribbean and 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 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. Basis of Presentation The consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, the accompanying consolidated financial statements, prepared in accordance with GAAP, contain all adjustments, all of which are normal and recurring in nature, necessary for a fair presentation. A summary of the most significant accounting policies used in preparing the accompanying consolidated financial statements is as follows: Principles of Consolidation The accompanying consolidated financial statements include the accounts and operations of the Company, which are presented in accordance with GAAP. The Company consolidates all wholly owned subsidiaries and subsidiaries that are majority owned. Intercompany accounts and transactions are eliminated in the consolidated financial statements. Use of Estimates The preparation of the accompanying consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Revenue Recognition The Company’s revenue recognition policy follows the guidance from Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers , which provide guidance on the recognition, presentation, and disclosure of revenue in consolidated financial statements. The Company recognizes revenue when (or as) control of goods or services are transferred to a customer. The transfer of control occurs when the customer can direct the use of and receive substantially all the benefits from the transferred good or service. Therefore, revenue is recognized over time (typically for services) or at a point in time (typically for goods). The assessment of revenue recognition is performed by the Company based on the five-step model established in ASC 606, as follows: Step 1: Identify the contract with customer; Step 2: Identify the performance obligations in the contract; Step 3: Determine the transaction price; Step 4: Allocate the transaction price to the performance obligations in the contract; and Step 5: Recognize revenue when or as the entity satisfies a performance obligation. At contract inception, the Company evaluates whether the contract (i) is legally enforceable; (ii) approved by both parties; (iii) properly defines rights and obligations of the parties, including payment terms; (iv) has commercial substance; and (v) collection of substantially all consideration entitled is probable, before proceeding with the assessment of revenue recognition. If any of these requirements is not met, the contract does not exist for purposes of the model and any consideration received is recorded as a liability. A reassessment may be performed in a later date upon change in facts and circumstances. The Company also evaluates within this step if contracts issued within a period of 6 months with the same customer should be accounted for as a single contract. The Company’s contracts with customers may be modified through amendments, change requests or waivers. Upon receipt, modifications of contracts with customers are evaluated to determine if these must be accounted for: (i) as a separate contract, (ii) a cumulative catch-up, or (iii) as a termination and creation of a new contract. Contract modifications must also comply with the requirements to determine if a contract with a customer exists for accounting purposes. To identify performance obligations within contracts with customers, the Company first identifies all the promises in the contract (i.e., explicit and implicit). This includes the customer’s options to acquire additional goods or services for free or at a discount in exchange for an upfront payment. The Company then assesses if each material good or service (or bundle of goods or services) is distinct in nature (i.e., the customer can benefit from the good or service on its own or together with other readily available resources) and is capable of being distinct in the context of the contract (i.e., the promise to transfer the good or service is separately identifiable from other promises in the contract). A distinct good or service (or bundle of goods or services) constitutes a performance obligation. The Company also applies the series guidance to distinct goods or services (either with a specified quantity of goods or services or a stand-ready service), with an over time revenue recognition, to determine whether they should be accounted for as a single performance obligation. These distinct goods or services are recognized as a single performance obligation when their nature and timely increments are substantially the same and have the same pattern of transfer to the customer (i.e., the distinct goods or services within the series use the same method to measure progress towards complete satisfaction). To determine if a performance obligation should be recognized over time, one or more of the following criteria must be met: (1) the customer simultaneously receives and consumes the benefits as the Company performs (i.e., routine or recurring services); (2) the customer controls the asset as the entity creates or enhances it (i.e., asset on customer’s site); or (3) the Company’s performance does not create an asset for which the Company has an alternative use and there is a right to payment for performance to date (i.e., asset built to order). Performance obligations that do not meet the over time criteria are recognized at a point in time. In addition, in Step 2 of the model, the Company evaluates whether the practical expedient of right-to-invoice applies. If this practical expedient is applicable, steps 3, 4 and 5 are waived. For this practical expedient to apply, the right to consideration must correspond directly with the value received by the customer for the Company’s performance to date, no significant up-front payments or retroactive adjustments must exist, and specified minimums must be deemed non-substantive at the contract level. If the contract with the customer has multiple performance obligations and the practical expedient of right-to-invoice does not apply, the Company proceeds to determine the transaction price and allocate it on a standalone selling price basis among the different performance obligations identified in the Step 2. The Company generally applies the expected cost plus margin approach to determine the standalone selling price at the performance obligation level. In addition, for performance obligations that are satisfied over time and the right to invoice practical expedient is not available, the Company determines a method to measure progress (i.e., input or output method) based on current facts and circumstances. When these performance obligations have variable consideration within its transaction price and are part of a series, the Company allocates the variable consideration to each time increment. As part of the revenue recognition analysis, when another party is involved in providing goods or services to a customer, the Company evaluates, for each performance obligation, whether it is providing the goods or services itself (i.e., as principal), or if it is only arranging on behalf of the other party. The Company acts as principal if it controls the specified good or service before that good or service is transferred to a customer. To determine if the Company acts as an agent, the Company considers indicators, such as: (i) the responsibility to fulfill a promise; (ii) the inventory risk; and (iii) the price determination. The Company may also generate revenues from payments received under collaborative arrangements. Management analyzes its collaborative arrangements to assess whether such arrangements, or transactions between arrangement participants, involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities or are more akin to a vendor-customer relationship. In making this assessment, management considers whether the activities in the collaborative arrangement are considered to be distinct and deemed within the scope of ASC 808, Collaborative Arrangements and those that are more reflective of a vendor-customer relationship and, therefore, within the scope of ASC 606. This assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. Investment in Equity Investee The Company accounts for investments using the equity method of accounting if the investment provides the Company the ability to exercise significant influence, but not control, over an investee. Significant influence is generally deemed to exist if the Company has an ownership interest in the voting stock of an investor of between 20 percent and 50 percent, although other factors are considered in determining whether the equity method of accounting is appropriate. Under this method, the investment, originally recorded at cost, is adjusted to recognize the Company’s share of net income or losses as they occur. The Company’s share of investee earnings or losses is recorded, net of taxes, within earnings (losses) of equity method investment caption in the consolidated statements of income and comprehensive income. The Company’s consolidated revenues include fees for services provided to an investee accounted for under the equity method. Additionally, the Company’s interest in the net assets of its equity method investee is reflected in the consolidated balance sheets. On the acquisition of the investment, any difference between the cost of the investment and the amount of the underlying equity in net assets of an investee is required to be accounted as if the investee were a consolidated subsidiary. If the difference is assigned to depreciable or amortizable assets or liabilities, then the difference should be amortized or accreted in connection with the equity earnings based on the Company’s proportionate share of the investee’s net income or loss. If the investor is unable to relate the difference to specific accounts of the investee, the difference should be considered goodwill. The Company considers whether the fair value of its equity method investment has declined below its carrying value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If the Company considered any such decline to be other than temporary (based on various factors, including historical financial results, product development activities and the overall health of the investee’s industry), then the Company would record a write-down to estimated fair value. Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method and expensed over their estimated useful lives. Amortization of leasehold improvements is computed over the terms of the respective leases, including renewal options considered by management to be reasonably assured of being exercised, or the estimated useful lives of the improvements, whichever is shorter. Costs of maintenance and repairs which do not improve or extend the life of the respective assets are expensed as incurred. Leases The Company’s leases accounting policy follows the guidance from ASC 842, Leases, which provides guidance on the recognition, presentation, and disclosure of leases in consolidated financial statements. The Company determines if an arrangement is or contains a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease payable, and operating lease liabilities in the consolidated balance sheets. Finance leases are included in property and equipment and accrued liabilities in the consolidated balance sheets. ROU assets and lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. As most of the Company’s leases do not provide an implicit rate, Management uses the Company’s collateralized incremental borrowing rate (“IBR”) based on the information available at commencement date in determining the present value of future payments. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. We monitor events or changes in circumstances that change the timing or amount of future lease payments which results in the remeasurement of a lease liability, with a corresponding adjustment to the ROU asset. The lease payment terms may include fixed payment terms and variable payments. Fixed payment terms and variable payments that depend on an index (i.e., Consumer Price Index or “CPI”) or rate are considered in the determination of the operating lease liabilities. While lease liabilities are not remeasured because of changes to the CPI, changes are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. Variable payments that do not depend on an index or rate are not included in the lease liabilities determination. Rather, these payments are recognized as variable lease expense when incurred. Variable lease payments are included within operating costs and expenses in the consolidated statements of income and comprehensive income. For operating leases, lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For finance leases, lease expense is composed of interest expense and amortization expense. The lease liability of these leases is measured using the interest rate method. The ROU asset from financing leases is amortized on a straight-line basis, and is presented as part of Property and Equipment, net. The Company has lease agreements with lease and non-lease components, which are accounted for as a single lease component. The Company elected the practical expedient of not separating lease and related non-lease components for all classes of underlying assets (i.e., building and equipment). The Company also elected as an accounting policy to not recognize lease liabilities and ROU assets for any future short-term leases (i.e., leases with a lease term of 12 months or less). Impairment of Long-lived Assets Long-lived assets to be held and used, and long-lived assets to be disposed of, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Capitalization of Software The Company develops software that is used in providing processing services to customers. Capitalized software includes purchased software and internally developed software and is recognized as software packages within the other intangible assets line item in the consolidated balance sheets. Capitalization of internally developed software occurs only after the preliminary project stage is complete, management with applicable authority approves funding of the project, it is probable that the project will be completed, and the software will be used to perform the intended function. Tasks that are generally capitalized are as follows: (a) system design of a chosen path including software configuration and software interfaces; (b) employee costs directly associated with the internal-use computer software project; (c) software development (coding) and software and system testing and verification; (d) system installation; and (e) enhancements that add function and are considered permanent. These tasks are capitalized and amortized using the straight-line method over its estimated useful life, which range from three The Company capitalizes interest costs incurred in the development of software. The amount of interest capitalized is an allocation of the interest cost incurred during the period required to substantially complete the asset. The interest rate for capitalization purposes is based on a weighted average rate on the Company’s outstanding borrowing. For the years ended December 31, 2021, 2020 and 2019, interest cost capitalized amounted to approximately $0.8 million, $0.7 million, and $1.1 million, respectively. Software and Maintenance Contracts Software and maintenance contracts are recorded at cost. The cost is recognized as prepaid expenses and amortized over the term of the related contract. The unamortized balance is included within prepaid expenses and other assets or other long-term assets depending on their remaining useful lives. Amortization of software and maintenance contracts is computed using the straight-line method and their estimated useful lives range from one Goodwill and Other Intangible Assets Goodwill represents the excess of the purchase price and related costs over the value assigned to net assets acquired. Goodwill is not amortized, but is tested for impairment at least annually, or more often if events or circumstances indicate there may be impairment. The Company first assesses qualitative factors to determine whether it is necessary to perform the quantitative impairment test. If determined to be necessary, the quantitative impairment test shall be used to identify goodwill impairment and measure the amount of a goodwill impairment loss to be recognized (if any). The Company may assess qualitative factors to determine whether it is more likely than not, that is, a likelihood of more than 50 percent that the fair value of the reporting unit is less than its carrying amount, including goodwill. The Company has an unconditional option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the quantitative goodwill impairment test. The Company may resume performing the qualitative assessment in any subsequent period. The quantitative goodwill impairment test, used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of a reporting unit with its carrying amount, including goodwill. If the Company determines to perform a quantitative impairment test, a third-party valuator may be engaged to prepare an independent valuation of each reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. Additionally, the Company shall consider the income tax effect from any tax-deductible goodwill on the carrying amount of the reporting unit, if applicable, when measuring the goodwill impairment loss. For the years ended December 31, 2021, 2020 and 2019, no impairment losses associated with goodwill were recognized. Other identifiable intangible assets with definitive useful lives are amortized using the straight-line method or accelerated methods. These intangibles are evaluated periodically for impairment when events or changes in circumstances indicate that the carrying amounts may not be recoverable. Other identifiable intangible assets with definitive useful lives include customer relationships, trademarks, software packages and a non-compete agreement. Customer relationships were valued using the excess earnings method under the income approach. Trademark assets were valued using the relief-from-royalty method under the income approach. Internally developed software packages, which include capitalized software development costs, are recorded at cost, while software packages acquired as part of a business combination were valued using the relief-from-royalty method under the income approach. The non-compete agreement was valued based on the estimated impact that theoretical competition would have on revenues and expenses. Derivative Instruments and Hedging Activities The Company uses derivative financial instruments to enhance its ability to manage its exposure to certain financial and market risks. On the date the derivative instrument contract is entered into, the Company may designate the derivative as (1) a hedge of the fair value of a recognized asset or liability or an unrecognized firm commitment (“fair value” hedge), (2) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (“cash flow” hedge), or (3) as a “standalone” derivative instrument, including economic hedges that the Company has not formally documented as a fair value or cash flow hedge. Changes in the fair value of a derivative that qualifies for cash flow hedge accounting are recognized in Other Comprehensive Income (Loss). Amounts accumulated in other comprehensive income (loss) are reclassified to earnings when the related cash outflow affects earnings. Changes in the fair value of a derivative instrument that is highly effective and that is designated and qualifies as a fair value hedge, along with changes in the fair value of the hedged asset or liability that are attributable to the hedged risk (including gains or losses on firm commitments), are recorded in current-period earnings. Similarly, the changes in the fair value of stand-alone derivative instruments or derivatives not qualifying or designated for hedge accounting are reported in current-period earnings. The Company recognizes all derivative financial instruments in the consolidated balance sheets as assets or liabilities at fair value. The Company presents derivative assets and derivative liabilities separately in the consolidated balance sheets. The Company does not enter into derivative financial instruments for speculative purposes. Income Tax Income taxes are accounted for under the asset and liability method. A temporary difference refers to a difference between the tax basis of an asset or liability, determined based on recognition and measurement requirements for tax positions, and its reported amount in the financial statements that will result in taxable or deductible amounts in future years when the reported amount of the asset or liability is recovered or settled, respectively. Deferred tax assets and liabilities represent the future effects on income taxes that result from temporary differences and carryforwards that exist at the end of a period. Deferred tax assets and liabilities are measured using enacted tax rates and provisions of the enacted tax law and are not discounted to reflect the time-value of money. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of income and comprehensive income in the period that includes the enactment date. A deferred tax valuation allowance is established if it is considered more likely than not that all or a portion of the deferred tax asset will not be realized. The Company recognizes the benefit of uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement or disposition of the underlying issue with the taxing authority. Accordingly, the amount of benefit recognized in the consolidated financial statements may differ from the amount taken or expected to be taken in the tax return resulting in unrecognized tax benefits (“UTBs”). The Company recognizes the interest and penalties associated with UTBs as part of the provision for income taxes on its consolidated statements of income and comprehensive income. Accrued interest and penalties are included on the related tax liability line in the consolidated balance sheets. All companies within EVERTEC are legal entities that file separate income tax returns. Cash and cash equivalents Cash includes cash on hand and in banks. Cash equivalents consist of certificates of deposits with original maturities of three months or less. Restricted Cash Restricted cash represents cash received on deposits from participating institutions of the ATH network that has been segregated for the development of the ATH brand and cash maintained as collateral for a credit facility with Popular. Also, restricted cash includes a reserve account for payment and transaction processing services to merchants. Prior to the sale in 2021 of assets related to the Ticketpop business and subsequent exit from this business, restricted cash also included cash collected from the Ticketpop business. The restrictions of these accounts are based on contractual provisions entered into with third parties. This cash is maintained in separate accounts at a financial institution in Puerto Rico. Debt Securities Debt securities available-for-sale are accounted for under the provisions of the Accounting Standards Codification ("ASC") 320 Investments – Debt and Equity Securities , which requires that debt securities available-for-sale ("AFS") be carried at fair value on the Company’s consolidated balance sheets with unrealized gains (losses) generally recorded through other comprehensive income (“OCI”). Debt securities in an unrealized loss position which the Company intends to sell or for which it is more likely than not that the Company will be required to sell before recovery of the amortized cost basis, are written down to fair value through income. Quarterly, for debt securities in an unrealized loss position that the Company does not intend or will, more likely than not, not be required to sell, the Company evaluates if the decline in fair value has resulted from credit losses or other factors. If it is determined that the decline in fair value is related to credit losses, the Company records an allowance for credit losses, limited to the amount by which the fair value is less than the amortized cost basis. If the Company determines that the decline in value is related to factors other than credit, the Company recognizes the impairment through OCI. Allowance for Current Expected Credit Losses The Company monitors trade receivable balances and estimates the allowance for current expected credit losses based on historical loss rates adjusted by macroeconomic factors. Receivables are considered past due if full payment is not received by the contractual date. Past due accounts are generally written off against the allowance for current expected credit losses, only after all collection attempts have been exhausted. Foreign Currency Translation Assets and liabilities denominated in foreign currencies are translated to U.S. dollars using prevailing rates of exchange at the end of the period. Revenues, expenses, gains and losses are translated using weighted average rates for the period. The resulting foreign currency translation adjustment from operations for which the functional currency is other than the U.S. dollar is reported in accumulated other comprehensive loss. Gains and losses on transactions denominated in currencies other than the functional currencies are included in determining net income for the period in which exchange rates change. Share-based Compensation The Company estimates the fair value of stock-based awards, on a contemporaneous basis, at the date they are granted using the Monte Carlo simulation analysis for market based restricted stock units (“RSUs”) using the following assumptions: (1) stock price; (2) risk-free rate; (3) expected volatility; (4) expected annual dividend yield and (5) expected term. The risk-free rate is based on the U.S. Constant Maturities Treasury Interest Rate as of the grant date or the yield of a 2-year or 3-year Treasury bond, as applicable. The expected volatility is based on a combination of historical volatility and implied volatility from publicly traded companies in the Company’s industry. The expected annual dividend yield is based on management’s expectations of future dividends as of the grant date and, in certain cases, assumes that those dividends will be reinvested over the performance period. Performance and time based RSUs and restricted stock are valued based on the market price of the Company’s stock at the grant date. Upon restricted stock or RSUs release, participants may elect to “net share settle”. Rather than requiring the participant to deliver cash to satisfy the tax withholdings, the Company withholds a sufficient number of shares to cover these amounts and delivers the net shares to the participant. Net Income Per Common Share Basic net income per common share is determined by dividing net income by the weighted-average number of common shares outstanding during the period. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently adopted accounting pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued updated guidance for Accounting Standards Codification (“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 adoption of these amendments did not have a material impact on the Company’s consolidated financial statements. Recently issued accounting pronouncements not yet adopted In October 2021, the FASB issued ASC 805, Business Combinations, to require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. The Company will apply this guidance to business combinations once applicable. In March 2020, the FASB issued guidance under 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 adoption of this guidance will not have an impact on the Company's consolidated financial statements. |
Debt Securities
Debt Securities | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Debt Securities | Debt Securities Debt securities were purchased close to the final trading day of the quarter ended March 31, 2021 and are held by a trust in the Costa Rica National Bank as a collateral requirement for settlement activities. The Company may substitute securities as needed but must maintain certain levels of collateral based on transaction volumes. The amortized cost, gross unrealized gains and losses recorded in OCI, and estimated fair value as of December 31, 2021 were as follows: December 31, 2021 (In thousands) Gross unrealized Amortized cost Gains Losses Fair Value Costa Rica Government Obligations After 1 to 5 years $ 2,963 $ 78 $ — $ 3,041 |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues Summary of Revenue Recognition Accounting Policy The Company's revenue recognition policy follows ASC 606, Revenue from Contracts with Customers , which provides guidance on the recognition, presentation, and disclosure of revenue from contracts with customers in consolidated financial statements. Revenue is measured based on the consideration specified in a contract with a customer. Once the Company determines a contract's performance obligations and the transaction price, including an estimate of any variable consideration, the Company allocates the transaction price to each performance obligation in the contract using a standalone selling price ("SSP"). The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product or service to a customer. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. Nature of performance obligations At contract inception, the Company assesses the goods and services promised in the contract with a customer and identifies a performance obligation for each promise to transfer to the customer a good or service (or bundle of goods or services) that is distinct. To identify the performance obligations, the Company considers all the goods or services promised in the contract regardless of whether they are explicitly stated or implied. Payment for the Company’s contracts with customers are typically due in full within 30 days of invoice date. The following is a description of the Company's principal revenue generating activities, including the separate performance obligations by operating segment. The Payment Services - Puerto Rico & Caribbean segment provides financial institutions, government entities and other issuers services to process credit, debit and prepaid cards; automated teller machines and electronic benefit transfer (“EBT”) card programs (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). Revenue is principally derived from fixed fees per transaction and time and material basis billing for professional services provided to enhance the existing hosted platforms. Professional services in these contracts are primarily considered non-distinct from the transactional services and accounted for as a single performance obligation. Revenue for these contracts is recognized over time for the amount which the Company has right to consideration. The Payment Services - Latin America segment provides financial institutions, government entities and other issuers services to process credit, debit and prepaid cards, for which revenue is recognized in the same manner as described above, as well as licensed software solutions for risk and fraud management and card payment processing. Licensed software solutions are provided mainly as Software as a Service ("SaaS") and on-premise perpetual licenses. Set-up fees related to SaaS are considered non-distinct from the license and accounted for as a single performance obligation. SaaS revenues are recognized over time while the customer benefits from the software. On-premises perpetual licenses require significant customization and development. Professional services provided for significant customizations and development are non-distinct from the license and accounted for as a single performance obligation, recognized over time during the development of the license. Revenue is recognized based on the Company's efforts or inputs, measured in labor hours expended, relative to the total expected inputs to satisfy the performance obligation. Maintenance or support services are considered distinct and recognized over time in the amount in which the Company has right to consideration. The Merchant Acquiring segment provides customers with the ability to accept and process debit and credit cards. Revenue is derived from fixed or identifiable fees charged to individual merchants per transaction, set-up fees, monthly membership fees and rental of point-of-sale ("POS") terminals. Set-up fees are considered non-distinct from the transaction processing services and accounted for as a single performance obligation. Revenue for these contracts is recognized over time in the amount in which the Company has right to consideration. The Business Solutions segment consists of revenues from a full suite of business process management solutions. Revenue derived from core bank processing and other processing and transaction-based services are generally recognized over time in the amount in which the Company has right to consideration. Hosting services generally represent a series of distinct monthly increments that are substantially the same and has the same pattern of transfer. Professional services to enhance EVERTEC's platforms are generally considered non-distinct from the hosting service and accounted for as a single performance obligation. Hosting services are generally recognized over time once in production during the remaining term of the contract. Maintenance or support services are usually considered distinct and recognized over time in the amount in which the Company has right to consideration. Hardware and software sales are recognized at a point in time when the control of the asset is transferred to the customer. Indicators of transfer of control include the Company's right to payment, or as the customer has legal title or physical possession of the asset. The Company may also provide professional services to enhance customer's platforms or as IT consulting services by arranging for other parties to transfer the services (i.e., acting as an agent). For these contracts, revenue is recognized on a net basis. The Company’s service contracts may include service level arrangements (“SLA”) generally allowing the customer to receive a credit for part of the service fee when the Company has not provided the agreed level of services. If triggered, the SLA is deemed a consideration payable that may impact the transaction price of the contract, thus SLA performance is monitored and assessed for compliance with arrangements on a monthly basis, including determination and accounting for its economic impact, if any. The Company enters into collaborative arrangements aimed at growing the Company’s merchant relationships. These arrangements are accounted for under ASC 606 as required by ASC 808 Collaborative Arrangements and are included as part of the Company’s Merchant Acquiring segment and Payment Processing – Latin America segment. For the years ended December 31, 2021, 2020 and 2019, the Company recognized revenue amounting to $23.9 million, $9.9 million, and $9.8 million, respectively, for these arrangements. Refer to Note 24 - Segment Information for further information, including revenue by products and services the Company provides and the geographic regions in which the Company operates. Significant Judgments Determining a measure of progress for performance obligations satisfied over time requires management to make judgments that affect the timing of revenue to be recognized. The Company exercises judgment in identifying a suitable method that depicts the entity’s performance in transferring control of these performance obligations, on a contract-by-contract basis. The principal criteria used for determining the measure of progress is the availability of reliable information that can be obtained without incurring undue cost, which generally results in the application of an input method since, in most cases, the outputs used to reasonably measure progress are not directly observable. Usually, the input method based on labor hours incurred, with respect to total expected labor hours to satisfy the performance obligation is applied. For performance obligations satisfied at a point in time, the Company determines that the customer is able to direct the use of, and obtain substantially all of the benefits from, the products at the time the products are delivered, the customer has legal title of the products or the Company’s has the right to payment. The Company mainly uses the expected cost-plus margin approach to allocate the transaction price in contracts with multiple performance obligations. To determine the SSP, the Company periodically performs an assessment to determine the margin of goods or services with the assistance of the different business areas. This assessment is performed considering past transactions and/or reasonably available information, including market conditions, trends or other company or customer specific factors, among others. Disaggregation of revenue The Company disaggregates revenue from contract with customers into the primary geographical markets, nature of 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 that the Company provides and the primary geographical markets in which the Company operates. Revenue disaggregated by segment is discussed in Note 24, Segment Information . In the following table, revenue for each segment, excluding intersegment revenues, is disaggregated by timing of revenue recognition for the periods indicated. Year ended on December 31, 2021 (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 $ 168 $ 2,045 $ — $ 8,882 $ 11,095 Products and services transferred over time 104,624 95,187 143,965 234,925 578,701 $ 104,792 $ 97,232 $ 143,965 $ 243,807 $ 589,796 Year ended on December 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 $ 134 $ 1,448 $ — $ 9,482 $ 11,064 Products and services transferred over time 88,138 76,115 109,788 225,483 499,524 $ 88,272 $ 77,563 $ 109,788 $ 234,965 $ 510,588 Year ended on December 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 $ 3,041 $ 3,811 $ — $ 10,421 $ 17,273 Products and services transferred over time 82,487 74,985 106,388 206,241 470,101 $ 85,528 $ 78,796 $ 106,388 $ 216,662 $ 487,374 Contract balances The following table provides information about contract assets from contracts with customers. December 31, (In thousands) 2021 2020 Balance at beginning of period $ 2,796 $ 1,191 Services transferred to customers 5,374 3,934 Transfers to accounts receivable (6,455) (2,329) Balance at end of period $ 1,715 $ 2,796 Contract assets of the Company arise when the Company has a contract with a customer for which revenue has been recognized (i.e., goods or services have been transferred), but the customer payment is subject to a future event (i.e., satisfaction of additional performance obligations). Contract assets are considered a receivable when the rights to consideration of the Company become unconditional (i.e., the Company has a present right to payment). The current portion of contract assets is recorded as part of prepaid expenses and other assets, and the long-term portion is included in other long-term assets in the consolidated balance sheets. Accounts receivable, net at December 31, 2021 and 2020 amounted to $113.3 million and $95.7 million, respectively. Contract liability and Contract liability- Long term, at December 31, 2021 amounted to $17.4 million and $36.3 million, respectively. Contract liability and Contract liability- Long term amounted to $25.0 million and $31.3 million at December 31, 2020, respectively. Contract liability is mainly comprised of upfront fees for implementation or set up activities, including fees charged in pre-production periods in connection with hosting services. Contract liability may also arise when consideration is received or due in advance from costumers prior to performance. During the year ended December 31, 2021, the Company recognized revenue of $25.7 million that was included in contract liability, at December 31, 2020. During the year ended December 31, 2020, the Company recognized revenue of $16.3 million that was included in unearned income at December 31, 2019. Transaction price allocated to the remaining performance obligations Revenues from recurring transaction-based and processing services represent the majority of the Company's total revenue. The Company recognizes revenues from recurring transaction-based and processing services over time at the amounts in which the Company has right to invoice, which corresponds directly to the value to the customer of the Company’s performance completed to date. Therefore, the Company has elected to apply the practical expedient in paragraph 606-10-50-14. Under this practical expedient, the Company is not required to disclose information about remaining performance obligations if the performance obligation is part of a contract with an original expected duration of one year or less or if the Company recognizes revenue at the amount to which it has a right to invoice. The Company also applies the practical expedient in paragraph 606-10-50-14A and does not disclose the information about remaining performance obligations for variable consideration when the variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with paragraph 606-10-25-14(b). |
Cash and cash equivalents
Cash and cash equivalents | 12 Months Ended |
Dec. 31, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Cash and cash equivalents | Cash and cash equivalentsAt December 31, 2021 and 2020, the Company’s cash and cash equivalents amounted to $266.4 million and $202.6 million, respectively, which are deposited in deposit accounts within financial institutions. Of the total cash balance at December 31, 2021 and 2020, $96.3 million and $80.0 million, respectively, reside in subsidiaries located outside of Puerto Rico. Cash deposited in an affiliate financial institution amounted to $173.9 million and $116.0 million as of December 31, 2021 and 2020, respectively. |
Accounts Receivable and Allowan
Accounts Receivable and Allowance for Current Expected Credit Losses | 12 Months Ended |
Dec. 31, 2021 | |
Receivables [Abstract] | |
Accounts Receivable and Allowance for Current Expected Credit Losses | Accounts Receivable and Allowance for Current Expected Credit Losses Accounts receivable, net consisted of the following: December 31, (In thousands) 2021 2020 Trade $ 66,255 $ 58,701 Due from affiliates, net 38,120 28,419 Settlement assets 11,417 10,641 Other 16 367 Less: allowance for current expected credit losses (2,523) (2,401) Accounts receivable, net $ 113,285 $ 95,727 The Company records settlement assets that result from timing differences in the Company’s settlement processes with merchants, financial institutions, and credit card associations related to merchant and card transaction processing. The amounts are generally collected or paid the following business day. Allowance for Current Expected Credit Losses Trade receivables from contracts with customers are financial assets analyzed by the Company under the expected credit loss model. 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 is comprised by government agencies. The governmental customers possess different risk characteristics than private customers because although all invoices are due 30 days after issuance, 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, to estimate the proportion of outstanding balances per aging bucket that ultimately will not be 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 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 Current Expected Credit Losses The activity in the allowance for current expected credit losses on trade receivables were as follows: (In thousands) December 31, 2021 December 31, 2020 Balance at the beginning of the period $ 2,401 $ 3,460 Current period provision for expected credit losses 819 832 Write-offs (698) (1,894) Recoveries of amounts previously written-off 1 3 Balance at the end of the period $ 2,523 $ 2,401 The Company does not have a delinquency threshold for writing-off trade receivables. The Company has a formal process 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 consolidated statements 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 consolidated balance sheets. |
Prepaid Expenses and Other Asse
Prepaid Expenses and Other Assets | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Assets | Prepaid Expenses and Other Assets Prepaid expenses and other assets consisted of the following: December 31, (In thousands) 2021 2020 Software maintenance contracts $ 11,629 $ 10,745 Deferred project costs 4,927 11,614 Prepaid cloud computing arrangement fees 4,453 2,145 Prepaid income taxes 4,080 3,757 Taxes other than on income 2,405 2,390 Insurance 2,286 2,335 Postage 2,078 1,906 Contract assets 1,677 2,661 Guarantee deposits 850 2,648 Other 2,763 2,013 Prepaid expenses and other assets $ 37,148 $ 42,214 |
Investment in Equity Investee
Investment in Equity Investee | 12 Months Ended |
Dec. 31, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Equity Investee | Investment in Equity Investee Consorcio de Tarjetas Dominicanas, S.A. (“CONTADO”) is the largest merchant acquirer and ATM network in the Dominican Republic. The Company uses the equity method of accounting to account for its equity interest in CONTADO. As a result of the acquisition in 2011 of CONTADO’s 19.99% equity interest, the Company calculated an excess cost of the investment in CONTADO over the amount of underlying equity in net assets of approximately $9.0 million, which was mainly attributed to customer relationships, trademark, and goodwill intangibles. The Company’s excess basis allocated to amortizable assets is recognized on a straight-line basis over the lives of the appropriate intangibles. Amortization expense for each of the years ended December 31, 2021, 2020 and 2019 amounted to approximately $0.2 million, $0.2 million and $0.3 million, respectively, and was recorded within earnings of equity method investment in the consolidated statements of income and comprehensive incom e. The Company recognized $1.7 million, $1.1 million, and $0.9 million as equity in CONTADO’s net income, net of amortization, in the consolidated statements of income and comprehensive income for the years ended December 31, 2021, 2020 and 2019, respectively. For the years ended December 31, 2021 and 2019, the Company received $1.2 million, and $0.5 million, respectively, in dividends from CONTADO. No dividends were received in 2020. CONTADO fiscal year ends December 31 and is reported in the consolidated statements of income and comprehensive income for the period subsequent to the acquisition date on a one-month lag. No significant events occurred in CONTADO’s operations subsequent to November 30, 2021 that would have materially affected the Company’s reported results. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net consisted of the following: Useful life December 31, (Dollar amounts in thousands) 2021 2020 Buildings 30 $ 1,359 $ 1,437 Data processing equipment 3 - 5 141,359 124,897 Furniture and equipment 3 - 20 7,718 6,691 Leasehold improvements 5 - 10 3,277 3,098 153,713 136,123 Less—accumulated depreciation and amortization (106,365) (93,826) Depreciable assets, net 47,348 42,297 Land 1,185 1,241 Property and equipment, net $ 48,533 $ 43,538 Depreciation and amortization expense related to property and equipment was $17.4 million, $17.4 million, and $16.6 million for the years ended December 31, 2021, 2020 and 2019, respectively. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The changes in the carrying amount of goodwill, allocated by reporting unit, were as follows: (In thousands) Payment Payment Merchant Business Total Balance at December 31, 2019 $ 160,972 $ 54,571 $ 138,121 $ 45,823 $ 399,487 Foreign currency translation adjustments — (1,817) — — (1,817) Balance at December 31, 2020 160,972 52,754 138,121 45,823 397,670 Foreign currency translation adjustments — (4,352) — — (4,352) Balance at December 31, 2021 $ 160,972 $ 48,402 $ 138,121 $ 45,823 $ 393,318 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 analysis. In a qualitative analysis, the Company assesses whether it is "more likely than not" that the fair value of a reporting unit is less than its carrying amount. In the quantitative analysis, the Company compares the estimated fair value of the reporting units to their carrying values, including goodwill. The estimated fair value of the reporting units is computed using a combination of an income approach and a market approach. The income approach involves projecting the cash flows that the reporting unit is expected to generate and converting these cash flows into a present value equivalent through discounting. Significant estimates and assumptions used in the cash flow projection include, among others, earnings before interest, taxes, depreciation, and amortization ("EBITDA") margins, and the selection of discount rates. Internal projections are based on the Company’s historical experience and estimated future business performance. The discount rate used is based on the weighted-average cost of capital, which reflects the rate of return expected to be earned by market participants and the estimated cost to obtain long-term debt financing. The market approach estimates the value of a reporting unit by using multiples of revenue and EBITDA based on guideline of publicly traded companies. Valuation using the market approach requires management to make assumptions related to EBITDA multiples. Comparable businesses are selected based on the market in which the reporting units operate, considering size, profitability, and growth. 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 equaling the excess amount is recorded, limited to the recorded balance of goodwill. The Company performed a qualitative assessment or step zero process as of August 31, 2021. Using this process, the Company first assesses whether it is "more likely than not" that the fair value of a reporting unit is less than its carrying amount. No impairment losses were recorded in 2021, 2020 or 2019. Based on the results of this qualitative |
Other Intangible Assets, Net
Other Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets, Net | Other Intangible Assets, Net The carrying amount of other intangible assets consisted of the following: Useful life in years December 31, 2021 (In thousands) Gross Accumulated Net carrying Customer relationships 8 - 14 $ 357,991 $ (272,732) $ 85,259 Trademark 2 - 15 41,901 (36,684) 5,217 Software packages 3 - 10 326,320 (217,643) 108,677 Non-compete agreement 15 56,539 (42,404) 14,135 Other intangible assets, net $ 782,751 $ (569,463) $ 213,288 Useful life in years December 31, 2020 (In thousands) Gross Accumulated Net carrying Customer relationships 8 - 14 $ 343,981 $ (246,088) $ 97,893 Trademark 2 - 15 42,036 (35,467) 6,569 Software packages 3 - 10 289,205 (191,662) 97,543 Non-compete agreement 15 56,539 (38,635) 17,904 Other intangible assets, net $ 731,761 $ (511,852) $ 219,909 Amortization expense related to intangibles, including software packages, was $57.6 million, $54.1 million, and $51.5 million for the years ended December 31, 2021, 2020 and 2019, respectively. Amortization expense related to software packages was $26.0 million, $21.7 million, and $18.3 million for the years ended December 31, 2021, 2020 and 2019, respectively. The estimated amortization expense of balances outstanding at December 31, 2021 for the next five years are as follows: (In thousands) 2022 $ 52,534 2023 47,157 2024 35,139 2025 12,074 2026 5,607 |
Other Long-Term Assets
Other Long-Term Assets | 12 Months Ended |
Dec. 31, 2021 | |
Other Long Term Assets [Abstract] | |
Other Long-Term Assets | Other Long-Term Assets As of December 31, 2021, other long-term assets included $0.7 million related to deferred debt-issuance costs related to the revolving credit facility, $4.9 million related to the long-term portion of certain software maintenance contracts, and $4.3 million related to the long-term portion of deferred costs. As of December 31, 2020, other long-term assets included $1.0 million related to deferred debt-issuance costs related to the revolving credit facility, $4.8 million related to the long-term portion of certain software maintenance contracts, and $0.1 million related to the long-term portion of contract assets. |
Debt and Short-Term Borrowings
Debt and Short-Term Borrowings | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt and Short-Term Borrowings | Debt and Short-Term Borrowings Total debt was as follows: December 31, (In thousands) 2021 2020 2023 Term A Loan bearing interest at a variable interest rate (LIBOR plus applicable margin (1)(2) ) $ 170,875 $ 188,788 2024 Term B Loan bearing interest at a variable interest rate (LIBOR plus applicable margin (1)(3) ) 293,660 306,503 Notes Payable due on January 1, 2022 (1) 758 1,443 Total debt $ 465,293 $ 496,734 (1) Net of unaccreted discount and unamortized debt issue costs, as applicable. (2) Applicable margin of 1.75% at December 31, 2021 and December 31, 2020. (3) Subject to a minimum rate (“LIBOR floor”) of 0.00% plus applicable margin of 3.50% at December 31, 2021 and December 31, 2020. The following table presents contractual principal payments for the next years: (In thousands) 2022 $ 19,750 2023 158,364 2024 289,344 Thereafter — 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 ("2023 Term A Loan"), a $325.0 million term loan B facility that matures on November 27, 2024 ("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 material terms and conditions of the secured credit facilities are summarized below. Scheduled Amortization Payments The 2023 Term A Loan provides for amortization in the amount of 1.25% of the original principal amount of the 2023 Term A Loan during each of the first twelve quarters starting from the quarter ending March 31, 2019, 1.875% during each of the four subsequent quarters and 2.50% during each of the final three quarters, with the balance payable on the final maturity date. The 2024 Term B Loan provides for quarterly amortization payments totaling 1.00% per annum of the original principal amount of the 2024 Term B Loan, with the balance payable on the final maturity date. Voluntary Prepayments and Reduction and Termination of Commitments The 2018 Credit Agreement allows EVERTEC Group to prepay loans and permanently reduce the loan commitments under the secured credit facilities at any time, subject to the payment of customary LIBOR breakage costs, if any, provided that, in connection with certain refinancing or repricing of the 2024 Term B Loan on or prior to the date which is six months after the closing date of the 2018 Credit Agreement, a prepayment premium of 1.00% will be required. Additionally, the 2018 Credit Agreement requires mandatory repayment of outstanding principal balances based on a percentage of excess cash flow provided that no such prepayment shall be due if the resulting amount of the excess cash flow multiplied by the applicable percentage is less than $10 million. On March 8, 2021 and March 5, 2020, in connection with this mandatory repayment clause, the Company repaid $17.8 million and $17.0 million, respectively, as a result of excess cash flow calculation performed for the years ended December 31, 2020 and 2019, respectively. Interest The interest rates under the 2023 Term A Loan and revolving credit facility are based on, at EVERTEC Group’s option, (a) adjusted LIBOR plus an interest margin of 2.25% or (b) the greater of (i) Bank of America’s “prime rate,” (ii) the Federal Funds Effective Rate plus 0.5% and (iii) adjusted LIBOR plus 1.0% (“ABR”) plus an interest margin of 1.25%. The interest rates under the 2024 Term B Loan are based on, at EVERTEC Group’s option, (a) adjusted LIBOR plus an interest margin of 3.50% or (b) ABR plus an interest margin of 2.50%. The interest margins under the 2023 Term A Loan and Revolving Facility are subject to reduction based on achievement of specified total secured net leverage ratio. Guarantees and Collateral EVERTEC Group’s obligations under the secured credit facilities and under any cash management, interest rate protection or other hedging arrangements entered into with a lender, or any affiliate thereof are guaranteed by EVERTEC and each of EVERTEC’s existing wholly-owned subsidiaries (other than EVERTEC Group) and subsequently acquired or organized subsidiaries, subject to certain exceptions. Subject to certain exceptions, the secured credit facilities are secured to the extent legally permissible by substantially all of the assets of (1) EVERTEC, including a perfected pledge of all of the limited liability company interests of EVERTEC Intermediate Holdings, LLC (“Holdings”), (2) Holdings, including a perfected pledge of all of the limited liability company interests of EVERTEC Group and (3) EVERTEC Group and the subsidiary guarantors, including but not limited to: (a) a pledge of substantially all capital stock held by EVERTEC Group or any guarantor and (b) a perfected security interest in substantially all tangible and intangible assets of EVERTEC Group and each guarantor. Covenants The secured credit facilities contain affirmative and negative covenants that the Company believes are usual and customary for a secured credit agreement. The negative covenants in the secured credit facilities include, among other things, limitations (subject to exceptions) on the ability of EVERTEC and its restricted subsidiaries to: • declare dividends and make other distributions; • redeem or repurchase capital stock; • grant liens; • make loans or investments (including acquisitions); • merge or enter into acquisitions; • sell assets; • enter into any sale or lease-back transactions; • incur additional indebtedness; • prepay, redeem or repurchase certain indebtedness; • modify the terms of certain debt; • restrict dividends from subsidiaries; • change the business of EVERTEC or its subsidiaries; and • enter into transactions with their affiliates. In addition, the 2023 Term A Loan and the Revolving Facility require EVERTEC to maintain a maximum total secured net leverage ratio of 4.25 to 1.00 for any quarter that ended on or prior to September 30, 2020. Beginning with the quarter ended December 31, 2020 and for fiscal quarters ending thereafter, 4.00 to 1.00. The unpaid principal balance at December 31, 2021 of the 2023 Term A Loan and the 2024 Term B Loan was $171.6 million, and $295.8 million, respectively. The additional borrowing capacity for the Revolving Facility at December 31, 2021 was $119.1 million. The Company issues letters of credit against the Revolving Facility which reduce the additional borrowing capacity of the Revolving Facility. Events of Default The events of default under the secured credit facilities include, without limitation, nonpayment, material misrepresentation, breach of covenants, insolvency, bankruptcy, certain judgments, change of control (as defined in the 2018 Credit Agreement) and cross-events of default on material indebtedness. 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 December 31, 2021, and December 31, 2020, the outstanding principal balance of the notes payable was $0.8 million and $1.5 million, respectively. These notes are included in accounts payable in the Company's consolidated balance sheets. Interest Rate Swaps As of December 31, 2021, the Company has an interest rate swap agreement, entered into in December 2018, which converts 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 2018 Swap April 2020 November 2024 $250 million 1-month LIBOR 2.89% The Company has accounted for this agreement as a cash flow hedge. Additionally, the Company had an interest rate swap agreement that matured in April 2020, with a notional amount of $200 million and a fixed rate of 1.9225%. The Company accounted for this swap as a cash flow hedge from inception to maturity. As of December 31, 2021, and 2020, the carrying amount of the derivatives included on the Company’s consolidated balance sheets was $13.4 million and $25.6 million, respectively. The fair value of these derivatives is estimated using Level 2 inputs in the fair value hierarchy on a recurring basis. During the years ended December 31, 2021, 2020 and 2019, the Company reclassified losses of $7.1 million, losses of $5.1 million and gains of $0.7 million, respectively, from accumulated other comprehensive loss into interest expense. Based on current LIBOR rates, the Company expects to reclassify losses of $7.0 million from accumulated other comprehensive loss into interest expense over the next 12 months. Refer to Note 14 for tabular disclosure of the fair value of derivatives and to Note 16 for tabular disclosure of gains (losses) recorded on cash flow hedging activities. At December 31, 2021, the cash flow hedge is considered highly effective. |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments and Fair Value Measurements | Financial Instruments and Fair Value Measurements Recurring Fair Value Measurements Fair value measurement provisions establish a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These provisions describe three levels of input that may be used to measure fair value: Level 1: Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level 2: Inputs, other than quoted prices included in Level 1, which are observable for the asset or liability through corroboration with market data at the measurement date. Level 3: Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The Company uses observable inputs when available. Fair value is based upon quoted market prices when available. If market prices are not available, the Company may employ models that mostly use market-based inputs including yield curves, interest rates, volatilities, and credit curves, among others. The Company limits valuation adjustments to those deemed necessary to ensure that the financial instrument’s fair value adequately represents the price that would be received or paid in the marketplace. Valuation adjustments may include consideration of counterparty credit quality and liquidity as well as other criteria. The estimated fair value amounts are subjective in nature and may involve uncertainties and matters of significant judgment for certain financial instruments. Changes in the underlying assumptions used in estimating fair value could affect the results. The fair value measurement levels are not indicative of risk of investment. The fair value of financial instruments is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value estimates are made at a specific point in time based on the type of financial instrument and relevant market information. Many of these estimates involve various assumptions and may vary significantly from amounts that could be realized in actual transactions. The following table summarizes fair value measurements by level at December 31, 2021 and 2020, for assets and liabilities measured at fair value on a recurring basis: (In thousands) Level 1 Level 2 Level 3 Total December 31, 2021 Financial asset: Costa Rica Government Obligations $ — $ 3,041 $ — $ 3,041 Financial liability: Interest rate swap $ — $ 13,392 $ — $ 13,392 December 31, 2020 Financial liability: Interest rate swap $ — $ 25,578 $ — $ 25,578 Debt Securities The fair value of the debt securities is determined by a third-party service provider and it is based on the value of trading securities in the local Costa Rica market. Derivative Instruments The fair value of the Company’s derivative instrument is determined using a standard valuation model. The significant inputs used in these models are readily available in public markets, or can be derived from observable market transactions, and therefore have been classified as Level 2. Inputs used in these standard valuation models for derivative instruments include the applicable forward rates and discount rates. The discount rates are based on the historical LIBOR Swap rates. The following table presents the carrying value, as applicable, and estimated fair values for financial instruments at December 31, 2021 and 2020: December 31, 2021 2020 (In thousands) Carrying Fair Carrying Fair Financial asset: Costa Rica Government Obligations $ 3,041 $ 3,041 $ — $ — Financial liabilities: Interest rate swap $ 13,392 $ 13,392 $ 25,578 $ 25,578 2023 Term A Loan 170,875 168,610 188,788 186,678 2024 Term B Loan 293,660 294,735 306,503 308,336 The fair values of the term loans at December 31, 2021 and 2020 were obtained using the 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. Also, the pricing may include the use of an algorithm that could take into account movement in the general high yield market, among other variants. The secured term loans are not measured at fair value in the balance sheets. |
Other Long-Term Liabilities
Other Long-Term Liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | Other Long-Term Liabilities As of December 31, 2021, other long-term liabilities mainly consist of an unrecognized tax benefit liability of $5.6 million, and other long-term liabilities of $2.7 million. As of December 31, 2020, other long-term liabilities mainly consist of an unrecognized tax benefit liability of $8.7 million, and long-term portion of notes payable and long-term liabilities others of $5.3 million. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Equity | Equity The Company is authorized to issue up to 206,000,000 shares of common stock of $0.01 par value. At December 31, 2021 and 2020, the Company had 71,969,856 and 72,137,678 shares outstanding, respectively. The Company is also authorized to issue 2,000,000 shares of $0.01 par value preferred stock. As of December 31, 2021 and 2020, no shares of preferred stock have been issued. Stock Repurchase In 2021, 2020 and 2019, the Company repurchased a total of 0.6 million, 0.3 million, and 1.1 million shares, respectively, at a cost of $24.4 million, $7.3 million and $31.8 million. The Company funded such repurchases with cash on hand and borrowings to the existing revolving credit facility. As of December 31, 2021, 2020 and 2019, the repurchased shares were permanently retired. Dividends The Company pays a regular quarterly dividend on common stock, subject to the declaration thereof by the Board of Directors ("Board") each quarter. Any declaration and payment of future dividends to holders of the common stock will be at the discretion of the Board and will depend on many factors, including the financial condition, earnings, available cash, business opportunities, legal requirements, restrictions in our debt agreements and other contracts, capital requirements, level of indebtedness and other factors that the Board deems relevant. The Company’s dividend activity in 2021 and 2020 was as follows: Declaration Date Record Date Payment Date Dividend per share February 20, 2020 March 4, 2020 April 3, 2020 0.05 April 21, 2020 May 4, 2020 June 5, 2020 0.05 July 24, 2020 August 3, 2020 September 4, 2020 0.05 October 20, 2020 November 2, 2020 December 4, 2020 0.05 February 18, 2021 March 1, 2021 March 26, 2021 0.05 April 22, 2021 May 3, 2021 June 4, 2021 0.05 July 22, 2021 August 2, 2021 September 3, 2021 0.05 October 21, 2021 November 1, 2021 December 3, 2021 0.05 Accumulated Other Comprehensive Loss The following table provides a summary of the changes in the balances comprising accumulated other comprehensive loss for the years ended December 31, 2021 and 2020: Foreign Currency Cash Flow Hedge Unrealized Gains on Debt Securities AFS Total Balance - December 31, 2019, net of tax $ (16,872) $ (13,137) — $ (30,009) Other comprehensive loss before reclassifications (7,970) (15,341) — (23,311) Effective portion reclassified to net income — 5,066 — 5,066 Balance - December 31, 2020, net of tax (24,842) (23,412) — (48,254) Other comprehensive (loss) income before reclassifications (11,129) 4,086 109 (6,934) Effective portion reclassified to net income — 7,065 — 7,065 Balance - December 31, 2021, net of tax $ (35,971) $ (12,261) $ 109 $ (48,123) |
Share-based Compensation
Share-based Compensation | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Compensation | Share-based Compensation Long-Term Incentive Plan ("LTIP") During the three months ended March 31, 2019, 2020 and 2021, the Compensation Committee of the Company's Board approved grants of restricted stock units (“RSUs”) to executives and certain employees pursuant to the 2019 LTIP, 2020 LTIP and 2021 LTIP, respectively, all under the terms of the Company's 2013 Equity Incentive Plan. Under the LTIPs, the Company granted RSUs to eligible participants as time-based awards and/or performance-based awards. The vesting of the RSUs is dependent upon service 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 through 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 22 of each year for the 2019 LTIP, February 27 of each year for the 2020 LTIP, and March 2 of each year for the 2021 LTIP. For the performance-based awards under the 2019 LTIP, 2020 LTIP, and 2021 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 and will vest on February 22, 2022 for the 2019 LTIP, February 27, 2023 for the 2020 LTIP, and March 2, 2024 for the 2021 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 the nonvested restricted shares and RSUs activity for the years ended December 31, 2021, 2020 and 2019: Nonvested restricted shares and RSUs Shares Weighted average Nonvested at December 31, 2018 2,036,163 $ 15.09 Granted 517,153 30.84 Vested (931,389) 29.32 Forfeited (29,172) 16.52 Nonvested at December 31, 2019 1,592,755 20.71 Granted 413,733 31.62 Vested (762,194) 16.65 Forfeited (150,779) 19.22 Nonvested at December 31, 2020 1,093,515 27.88 Granted 705,970 31.93 Vested (683,706) 20.95 Forfeited (29,450) 33.36 Nonvested at December 31, 2021 1,086,329 $ 34.73 Share-based compensation recognized was as follows: Years ended December 31, (In thousands) 2021 2020 2019 Share-based compensation recognized, net Restricted shares and RSUs $ 14,799 $ 14,253 $ 13,570 The maximum unrecognized cost for restricted stock units was $19.1 million as of December 31, 2021. The cost is expected to be recognized over a weighted average period of 1.7 years. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit PlanEVERTEC, Inc. Puerto Rico Savings and Investment plan (“the EVERTEC Savings Plan”) was established in 2010, as a defined contribution savings plan qualified under section 1165(e) of the Puerto Rico Internal Revenue Code. Investments in the plan are participant directed, and employer matching contributions are determined based on specific provisions of the EVERTEC Savings Plan. Employees are fully vested in the employer’s contributions after five years of service. For the years ended December 31, 2021, 2020 and 2019, the costs incurred under the plan amounted to approximately $1.0 million, $0.9 million and $0.8 million, respectively. |
Total Other Income (Expenses)
Total Other Income (Expenses) | 12 Months Ended |
Dec. 31, 2021 | |
Other Income and Expenses [Abstract] | |
Total Other Income (Expenses) | Total Other Income (Expenses) For the year ended December 31, 2021, other income (expenses) is primarily comprised of $3.3 million in foreign currency transaction gains and $0.8 million for a gain on sale of assets from Ticketpop. For the year ended December 31, 2020, other income (expenses) is primarily comprised of $4.4 million in foreign currency transaction gains. For the year ended December 31, 2019, other income (expenses) is primarily comprised of $1.7 million in foreign currency transaction losses. |
Income Tax
Income Tax | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Income TaxEVERTEC Group and Holdings are Puerto Rico limited liability companies that are treated as partnerships that are pass-through entities for Puerto Rico tax purposes, therefore, taxable income flows through to EVERTEC, Inc. EVERTEC Group, Holdings and EVERTEC, Inc. entered into a Tax Payment Agreement pursuant to which EVERTEC Group is required to make certain payments to Holdings or EVERTEC, Inc. for taxable periods or portions thereof occurring on or after April 17, 2012 (the “Effective Date”). Under the Tax Payment Agreement, EVERTEC Group will make payments with respect to any and all taxes (including estimated taxes) imposed under the laws of Puerto Rico, the United States of America and any other jurisdiction or any political (including municipal) subdivision or authority or agency in Puerto Rico, the United States of America or such other jurisdiction, that would have been imposed on EVERTEC Group if EVERTEC Group had been a corporation for tax purposes of that jurisdiction, together with all interest and penalties with respect thereto (“Taxes”), reduced by taking into account any applicable net operating losses or other tax attributes of Holdings or EVERTEC, Inc. that reduce Holdings’ or EVERTEC, Inc.’s taxes in such period. The Tax Payment Agreement provides that the payments thereunder shall not exceed the net amount of Taxes that Holdings and EVERTEC, Inc. actually owe to the appropriate taxing authority for a taxable period. Further, the Tax Payment Agreement provides that if Holdings or EVERTEC, Inc. receives a tax refund attributable to any taxable period or portion thereof occurring on or after the Effective Date, EVERTEC, Inc. shall be required to recalculate the payment for such period required to be made by EVERTEC Group to Holdings or EVERTEC, Inc. If the payment, as recalculated, is less than the amount of the payment EVERTEC Group already made to Holdings or EVERTEC, Inc. in respect of such period, Holdings or EVERTEC, Inc. shall promptly make a payment to EVERTEC Group in the amount of such difference. The components of income tax expense consisted of the following: Years ended December 31, (In thousands) 2021 2020 2019 Current tax provision $ 23,388 $ 22,907 $ 19,366 Deferred tax benefit (2,826) (3,905) (6,391) Income tax expense $ 20,562 $ 19,002 $ 12,975 The Company conducts operations in Puerto Rico and certain countries in Latin America. As a result, the income tax expense includes the effect of taxes paid to the government of Puerto Rico as well as foreign jurisdictions. The following table presents the components of income tax expense and its segregation based on location of operations: Years ended December 31, (In thousands) 2021 2020 2019 Income before income tax provision Puerto Rico $ 148,331 $ 98,608 $ 89,667 United States 622 3,953 4,047 Foreign countries 32,752 21,292 22,961 Total income before income tax provision $ 181,705 $ 123,853 $ 116,675 Current tax provision Puerto Rico $ 6,792 $ 7,260 $ 7,550 United States 137 612 339 Foreign countries 16,459 15,035 11,477 Total current tax provision $ 23,388 $ 22,907 $ 19,366 Deferred tax (benefit) provision Puerto Rico $ (2,428) $ (2,087) $ (4,109) United States 109 1,041 (216) Foreign countries (507) (2,859) (2,066) Total deferred tax benefit $ (2,826) $ (3,905) $ (6,391) Taxes payable to foreign countries by EVERTEC’s subsidiaries will be paid by such subsidiary and the corresponding liability and expense will be presented in EVERTEC’s consolidated financial statements. As of December 31, 2021 and 2020, the Company had $99.1 million and $80.2 million of unremitted earnings from foreign subsidiaries, respectively. The Company has not recognized a deferred tax liability on undistributed earnings for the Company’s foreign subsidiaries because these earnings are intended to be indefinitely reinvested. The amount of the unrecognized deferred tax liability depends on judgment required to analyze the withholding tax due, the applicable tax law and factual circumstances in effect at the time of any such distributions. EVERTEC believes it is not practicable at this time to reliably determine the amount of unrecognized deferred tax liability related to the Company’s undistributed earnings. If circumstances change and it becomes apparent that some or all of the undistributed earnings of a subsidiary will be remitted, and income taxes have not been recognized by the parent entity, the parent entity shall accrue as an expense of the current period income taxes attributable to that remittance. On October 19, 2012, EVERTEC Group was granted a tax exemption under the Tax Incentive Act No. 73 of 2008. Under this grant, EVERTEC Group will benefit from a preferential income tax rate on industrial development income, as well as from tax exemptions with respect to its municipal and property tax obligations for certain activities derived from its data processing operations in Puerto Rico. The grant has a term of 15 years effective as of January 1, 2012 with respect to income tax obligations and January 1, 2013 with respect to municipal and property tax obligations. Industrial development income under this grant is subject to a preferential rate of 4%. The grant contains customary commitments, conditions, and representations that EVERTEC Group will be required to comply with in order to maintain the grant. The more significant commitments include: (i) maintaining at least 700 employees in EVERTEC Group's Puerto Rico data processing operations, (ii) investing at least $200.0 million in building, machinery, equipment or computer programs to be used in Puerto Rico during the effective term of the grant (to be made over four-year capital investment cycles in $50.0 million increments); and (iii) 80% of EVERTEC Group employees must be residents of Puerto Rico. Failure to meet the requirements could result, among other things, in reductions of the benefits of the grant or revocation of the grant in its entirety, which could result in EVERTEC, Inc. paying additional taxes or other payments relative to what would be required to pay to other municipal agencies if the full benefits of the grant are not available. On October 11, 2011, Evertec Group was granted a tax exemption under Tax Incentive Law No. 73 of 2008, retroactively to December 1, 2009. Under this grant, activities derived from consulting and data processing services provided outside Puerto Rico are subject to a preferred rate that declines gradually from 7% to 4% by December 1, 2013. After this date, the rate remains at 4% until its expiration on November 30, 2024. In addition, in August 2018, the Puerto Rico Industrial Development Company approved the requested extension of a grant under Tax Incentive Law No. 135 of 1997 for EVERTEC Group. Under this grant, activities derived from certain development and installation service in excess of a determined income are subject to a fixed tax rate of 10% for a 10-year period from January 1, 2018. The following table presents the components of the Company’s deferred tax assets and liabilities: December 31, (In thousands) 2021 2020 Deferred tax assets (“DTA”) Allowance for doubtful accounts $ 175 $ 223 Unearned income 10,475 11,058 Lease liability 2,655 3,410 Share-based compensation 1,181 1,163 Debt issuance costs 132 189 Accrued liabilities 3,263 1,828 Derivative liability 1,036 2,070 Accrual of contract maintenance cost 84 110 Impairment of asset 290 310 Other 1,596 1,649 Total gross deferred tax assets 20,887 22,010 Deferred tax liabilities (“DTL”) Capitalized salaries 2,193 2,095 Difference between the assigned values and the tax basis of assets and liabilities recognized in business combinations 7,978 10,507 Right of use asset 2,707 3,340 Other 3,468 3,086 Total gross deferred tax liabilities 16,346 19,028 Deferred tax asset (liability), net $ 4,541 $ 2,982 As of December 31, 2021 and 2020, the net deferred tax asset amounted to $5.9 million and $3.9 million, respectively, with a valuation allowance of approximately $1.4 million and $0.9 million, respectively, included as part of other deferred tax assets, for a net deferred tax asset after valuation allowance of approximately $4.5 million and $3.0 million, respectively. Pursuant to the provision of the PR Code, net operating losses (“NOL”) can be carried forward for a period of seven, ten or twelve taxable years, depending on the taxable year generated. Act 72 of May 29, 2015, limited the amount of NOLs deduction to 80% for regular tax and 70% for alternative minimum tax (“AMT”) for taxable years commencing after December 31, 2014. However, Act 257 of 2018 limits the deduction of NOLs to 90% for regular tax for tax years commencing after December 31, 2018. At December 31, 2021, the Company has $6.8 million, $0.6 million and $4.0 million in NOL carryforwards related to Puerto Rico industrial development income, United States and foreign countries, respectively, available to offset future eligible income. The NOL balance as of December 31, 2021 expires as follows: (In thousands) 2026 $ 51 2028 688 2029 1,558 2030 4,112 2031 3,737 2033 178 Indefinitely 1,072 The Company recognizes the benefit of uncertain tax positions ("UTPs") only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The following is a tabular reconciliation of the total amounts of UTPs: Years ended December 31, (In thousands) 2021 2020 2019 Balance, beginning of year $ 5,908 $ 9,146 $ 9,238 Gross increases—tax positions in prior period 431 1,335 — Gross decreases—tax positions in prior period (101) (192) (92) Lapse of statute of limitations (2,287) (4,381) — Balance, end of year $ 3,951 $ 5,908 $ 9,146 As of December 31, 2021, 2020 and 2019, approximately $4.0 million, $5.9 million and $9.1 million, respectively, would have affected the Company’s effective income tax rate, if recognized. The Company recognizes interest and penalties related to UTB as part of income tax expense. During the years ended December 31, 2021, 2020 and 2019, the Company recognized an income tax expense of $0.4 million, $0.3 million and $0.4 million, respectively, related to interest and penalties. The amount accrued for interest and penalties at December 31, 2021 and 2020 was $1.6 million and $2.6 million, respectively. The Company estimates that it is reasonably possible that the Puerto Rico liability for uncertain tax position relating to the net operating loss created by transaction cost will decrease by approximately $3.6 million in the next 12 months as a result of the statute of limitations. The Company believes it has sufficient accruals for contingent tax liabilities. In connection with tax return examinations, contingencies can arise that generally result from different interpretations of tax laws and regulations as they pertain to the amount, timing or inclusion of revenues and expenses in taxable income, or the ability to utilize tax credits to reduce income taxes payable. While it is probable, based on the potential outcome of the Company’s Puerto Rico and foreign tax examinations or the statute of limitations for specific jurisdictions, that the liability for UTBs may increase or decrease within the next twelve months, the Company does not expect any such change would have a material effect on our financial condition, results of operations or cash flow. The Company and its subsidiaries are subject to Puerto Rico income tax as well as income tax of multiple foreign jurisdictions. A significant majority of the income tax is from Puerto Rico and Costa Rica. The income tax returns for 2017, 2018, 2019, and 2020 are currently open for examination for both jurisdictions, while 2014 and 2015 are also open for examination for Costa Rica. The income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate of 37.5% to the income before income taxes as a result of the following: Years ended December 31, (In thousands) 2021 2020 2019 Computed income tax at statutory rates $ 68,139 $ 46,445 $ 43,753 Differences in tax rates due to multiple jurisdictions 2,003 839 1,058 Excess tax benefits on share-based compensation (1,023) (1,094) (1,779) Effect of income subject to tax-exemption grant (46,762) (31,347) (31,424) Unrecognized tax (benefit) expense (3,388) 1,322 (32) Other, net 1,593 2,837 1,399 Income tax expense $ 20,562 $ 19,002 $ 12,975 |
Net Income Per Common Share
Net Income Per Common Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Income Per Common Share | Net Income Per Common Share The reconciliation of the numerator and the denominator of the earnings per common share is as follows: Years ended December 31, ( Dollar amounts in thousands, except share and per share data) 2021 2020 2019 Net income attributable to EVERTEC, Inc.’s common stockholders $ 161,130 $ 104,436 $ 103,469 Less: non-forfeitable dividends on restricted stock — — 3 Net income available to EVERTEC, Inc.'s common shareholders $ 161,130 $ 104,436 $ 103,466 Weighted average common shares outstanding 72,053,795 71,943,965 72,099,755 Weighted average potential dilutive common shares (1) 816,790 1,107,240 1,376,008 Weighted average common shares outstanding—assuming dilution 72,870,585 73,051,205 73,475,763 Net income per common share—basic $ 2.24 $ 1.45 $ 1.44 Net income per common share—diluted $ 2.21 $ 1.43 $ 1.41 (1) Potential common shares consist of common stock issuable under RSUs awards using the treasury stock method. Refer to Note 16 for a detail of dividends declared and paid during 2021 and 2020. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The following table presents the Company’s transactions with related parties for each of the periods presented below: Years ended December 31, (In thousands) 2021 2020 2019 Total revenues (1)(2) $ 245,613 $ 226,074 $ 209,053 Cost of revenues $ 2,610 $ 4,317 $ 5,094 Rent and other fees $ 7,487 $ 8,320 $ 8,519 Interest earned from an affiliate Interest income $ 647 $ 391 $ 161 (1) Popular, Inc. ("Popular") revenues as a percentage of total revenues were 42%, 44% and 43%, respectively, for each of the periods presented above. (2) Includes revenues generated from investee accounted for under the equity method of $0.3 million, $0.6 million and $1.1 million for the years ended December 31, 2021, 2020 and 2019, respectively. As of December 31, 2021 and 2020, EVERTEC had the following balances arising from transactions with related parties: December 31, (In thousands) 2021 2020 Cash and restricted cash deposits in affiliated bank $ 187,602 $ 126,189 Other due/to from affiliate Accounts receivable $ 38,120 $ 28,419 Prepaid expenses and other assets $ 1,763 $ 4,678 Operating lease right-of use assets $ 13,533 $ 17,099 Other long-term assets $ 2,853 $ — Accounts payable $ 5,601 $ 4,607 Unearned income $ 40,982 $ 35,807 Operating lease liabilities $ 14,019 $ 17,781 The balance of cash and restricted cash deposits in an affiliated bank was included within the cash and cash equivalents and restricted cash line items in the accompanying consolidated balance sheets. Due from affiliates mainly included the amounts |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies EVERTEC is a defendant in a number of legal proceedings arising in the ordinary course of business. Based on the opinion of legal counsel, management believes that the final disposition of these matters will not have a material adverse effect on the business, results of operations or financial condition of the Company. The Company has identified certain claims in which a loss may be incurred, but in the aggregate the loss would be minimal. For other claims, where the proceedings are in an initial phase, the Company is unable to estimate the range of possible loss for such legal proceedings. However, the Company at this time believes that any loss related to these latter claims will not be material. Leases The Company has operating leases for certain office facilities, buildings, telecommunications and other equipment; and finance leases for certain equipment. The Company’s lease contracts have remaining terms ranging from 1 year to 8 years, some of which may include options to extend the leases for up to 5 years, and some which may include the option to terminate the lease within 1 year. Total lease cost consisted of the following: Years ended December 31, (in thousands) 2021 2020 Operating lease cost $ 6,948 $ 7,025 Variable lease cost 2,472 3,182 Total lease costs $ 9,420 $ 10,207 Other Balance Sheet information related to operating leases was as follows: December 31, (In thousands) 2021 2020 Right-of-use assets obtained in exchange for operating lease obligations 178 $ 3,496 Weighted average remaining lease term, in years 4 5 Weighted Average Discount Rate 2.3% 2.8% The following table presents the balance of Operating lease obligations: December 31, (In thousands) 2021 2020 Operating lease liability - current 5,580 5,830 Operating lease liability - long-term 16,456 22,402 Total operating lease liabilities $ 22,036 $ 28,232 Future minimum operating lease payments at December 31, 2021 were as follows: (In thousands) 2022 6,387 2023 6,036 2024 5,123 2025 4,072 2026 871 Thereafter 1,617 Total future minimum lease payments 24,106 Less: imputed interest (2,070) Total $ 22,036 |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company operates in four business segments: Payment Services - Puerto Rico & Caribbean, Payment Services - Latin America (collectively "Payment Services segments"), Merchant Acquiring, and Business Solutions. The Payment Services - Puerto Rico & Caribbean segment revenues are comprised of revenues related to providing access to the ATH debit network and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and point of sale ("POS") transactions, ATM management and monitoring, ATH Movil and ATH Business. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions) and EBT (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). For ATH debit network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. For EBT services, revenues are primarily derived from the number of beneficiaries on file. The Payment Services - Latin America segment revenues consist of revenues related to providing access to the ATH network of ATMs and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), as well as licensed software solutions for risk and fraud management and card payment processing. For network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. The Merchant Acquiring segment consists of revenues from services that allow merchants to accept electronic methods of payment. In the Merchant Acquiring segment, revenues include a discount fee and membership fees charged to merchants, debit network fees and rental fees from POS devices and other equipment, net of credit card interchange and assessment fees charged by credit cards associations (such as VISA or MasterCard) or payment networks. The discount fee is generally a percentage of the transaction value. EVERTEC also charges merchants for other services that are unrelated to the number of transactions or the transaction value. The Business Solutions segment consists of revenues from a full suite of business process management solutions in various product areas such as core bank processing, network hosting and management, IT professional services, business process outsourcing, item processing, cash processing, and fulfillment. Core bank processing and network services revenues are derived in part from a recurrent fixed fee and from fees based on the number of accounts on file (i.e., savings or checking accounts, loans, etc.) or computer resources utilized. Revenues from other processing services within the Business Solutions segment are generally volume-based and depend on factors such as the number of accounts processed. In addition, EVERTEC is a reseller of hardware and software products and these resale transactions are generally non-recurring. In addition to the four operating segments described above, Management identified certain functional cost areas that operate independently and do not constitute businesses in themselves. These areas could neither be concluded as operating segments nor could they be combined with any other operating segments. Therefore, these areas are aggregated and presented as “Corporate and Other” category in the financial statements alongside the operating segments. The Corporate and Other category consists of corporate overhead expenses, intersegment eliminations, certain leveraged activities and other non-operating and miscellaneous expenses that are not included in the operating segments. The overhead and leveraged costs relate to activities such as: • marketing, • corporate finance and accounting, • human resources, • legal, • risk management functions, • internal audit, • corporate debt related costs, • non-operating depreciation and amortization expenses generated as a result of merger and acquisition activity, • intersegment revenues and expenses, and • other non-recurring fees and expenses that are not considered when management evaluates financial performance at a segment level. The Chief Operating Decision Maker ("CODM") reviews the operating segments separate financial information to assess performance and to allocate resources. Management evaluates the operating results of each of its operating segments based upon revenues and Adjusted EBITDA. Adjusted EBITDA is defined as EBITDA further adjusted to exclude unusual items and other adjustments. Adjusted EBITDA, as it relates to operating segments, is presented in conformity with ASC 280, Segment Reporting, given that it is reported to the CODM for purposes of allocating resources. Segment asset disclosure is not used by the CODM as a measure of segment performance since the segment evaluation is driven by revenues and adjusted EBITDA. As such, segment assets are not disclosed in the notes to the accompanying consolidated financial statements. The following tables set forth information about the Company’s operations by its four business segments for the periods indicated: December 31, 2021 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 155,392 $ 105,963 $ 143,965 $ 243,807 $ (59,331) $ 589,796 Operating costs and expenses 84,742 86,152 75,795 150,433 (3,840) 393,282 Depreciation and amortization 16,085 11,395 3,583 18,930 25,077 75,070 Non-operating income (expenses) 842 8,216 1,107 3,056 (7,109) 6,112 EBITDA 87,577 39,422 72,860 115,360 (37,523) 277,696 Compensation and benefits (2) 1,702 3,080 1,012 1,775 7,575 15,144 Transaction, refinancing, and other fees (3) 660 — — (647) 1,965 1,978 Adjusted EBITDA $ 89,939 $ 42,502 $ 73,872 $ 116,488 $ (27,983) $ 294,818 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $42.4 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction processing of $9.2 million from Payment Services- Latin America to both Payment Services- Puerto Rico & Caribbean and Business Solutions, and transaction processing and monitoring fees of $7.6 million from Payment Services - Puerto Rico & Caribbean to Payment Services - Latin America. (2) Primarily represents share-based compensation and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement, the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of dividends received, a software impairment charge and a gain from sale of assets. December 31, 2020 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 124,771 $ 84,641 $ 109,788 $ 234,965 $ (43,577) $ 510,588 Operating costs and expenses 72,968 73,030 58,163 141,446 23,589 369,196 Depreciation and amortization 13,455 11,299 1,905 17,551 27,308 71,518 Non-operating income (expenses) 202 6,934 650 1,938 (3,691) 6,033 EBITDA 65,460 29,844 54,180 113,008 (43,549) 218,943 Compensation and benefits (2) 987 2,934 926 1,794 7,742 14,383 Transaction, refinancing, exit activity and other fees (3) 500 — — — 6,641 7,141 Adjusted EBITDA $ 66,947 $ 32,778 $ 55,106 $ 114,802 $ (29,166) $ 240,467 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $34.6 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring and intercompany software sale and developments of $9.0 million from Payment Services- Latin America to Payment Services- Puerto Rico & Caribbean. (2) Primarily represents share-based compensation. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement, an impairment charge and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A. December 31, 2019 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 125,544 $ 84,453 $ 106,388 $ 216,662 $ (45,673) $ 487,374 Operating costs and expenses 61,396 65,701 62,098 138,224 15,453 342,872 Depreciation and amortization 11,646 9,930 1,814 16,529 28,163 68,082 Non-operating income (expenses) 1,781 286 48 340 (2,688) (233) EBITDA 77,575 28,968 46,152 95,307 (35,651) 212,351 Compensation and benefits (2) 1,034 1,501 1,004 2,114 8,145 13,798 Transaction, refinancing, and other fees (3) — 210 — — (163) 47 Adjusted EBITDA $ 78,609 $ 30,679 $ 47,156 $ 97,421 $ (27,669) $ 226,196 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $39.0 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software sale and developments of $6.7 million from Payment Services-Latin America to Payment Services-Puerto Rico & Caribbean. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received. The reconciliation of EBITDA to consolidated net income is as follows: Years ended December 31, (In thousands) 2021 2020 2019 Total EBITDA $ 277,696 $ 218,943 $ 212,351 Less: Income tax expense 20,562 19,002 12,975 Interest expense, net 20,921 23,572 27,594 Depreciation and amortization 75,070 71,518 68,082 Net Income $ 161,143 $ 104,851 $ 103,700 The geographic segment information below is classified based on the geographic location of the Company’s subsidiaries: Years ended December 31, (In thousands) 2021 2020 2019 Revenues (1) Puerto Rico $ 473,647 $ 418,151 $ 392,628 Caribbean 18,917 14,873 15,950 Latin America 97,232 77,564 78,796 Total Revenues $ 589,796 $ 510,588 $ 487,374 (1) Revenues are based on subsidiaries’ country of domicile. Major customers For the years ended December 31, 2021, 2020 and 2019, the Company had one major customer which accounted for approximately $245.3 million or 42%, $225.5 million or 44%, and $208.0 million or 43%, respectively, of total revenues. See Note 21. The Company’s next largest customer, the Government of Puerto Rico, consolidating all individual agencies and public corporations, represented 6%, 8%, and 7% of the Company’s total revenues for the years ended December 31, 2021, 2020 and 2019, respectively. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On February 15, 2022, the Board declared a regular quarterly cash dividend of $0.05 per share on the Company’s outstanding shares of common stock. The dividend will be paid on March 25, 2022 to stockholders of record as of the close of business on February 25, 2022. The Board anticipates declaring this dividend in future quarters on a regular basis; however future declarations of dividends are subject to Board of Directors’ approval and may be adjusted as business needs or market conditions change. On February 24, 2022, the Company announced that it had signed a definitive agreement with Banco Popular de Puerto Rico and its parent, Popular, to sell certain assets in exchange for Evertec stock held by Popular with an approximate value of $197 million. The Company also entered into an agreement to modify and extend certain commercial agreements with Popular that had an initial term ending in 2025. The transaction is expected to close during the mid-year 2022 and is subject to customary closing conditions. The Company also announced on February 24, 2022 that it entered into a share purchase agreement to acquire 100% of the outstanding shares of BBR SpA, a Santiago, Chile based payment solutions company with operating offices in Peru. The aggregate purchase price for the shares is CLP 48,600 million, approximately USD$60 million at current exchange rates. The transaction is subject to regulatory approval and is expected to close in the second or third quarter of 2022. |
Condensed Financial Statements
Condensed Financial Statements Parent Company Only | 12 Months Ended |
Dec. 31, 2021 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Statements Parent Company Only | Condensed Financial Statements Parent Company Only Condensed Balance Sheets December 31, (In thousands) 2021 2020 Assets Current assets: Cash $ 1,680 $ 1,680 Prepaid expenses and other assets — 470 Total current assets 1,680 2,150 Investment in subsidiaries, at equity 468,651 342,385 Deferred tax asset, net 4,062 2,786 Total assets $ 474,393 $ 347,321 Liabilities and stockholders’ equity Current liabilities: Accrued liabilities $ 1,259 $ 272 Accounts payable 1,448 2,777 Income tax payable 1,834 — Total current liabilities 4,541 3,049 Other long-term liabilities 3,640 6,530 Total liabilities 8,181 9,579 Stockholders’ equity: Common stock 719 721 Additional paid-in capital 7,565 5,339 Accumulated earnings 506,051 379,937 Accumulated other comprehensive loss, net of tax (48,123) (48,255) Total stockholders’ equity 466,212 337,742 Total liabilities and stockholders’ equity $ 474,393 $ 347,321 Condensed Statements of Income and Comprehensive Income Years ended December 31, (In thousands) 2021 2020 2019 Non-operating income (expenses) Equity in earnings of subsidiaries $ 157,787 $ 103,308 $ 101,078 Interest income 157 234 367 Other expenses (2,563) (1,594) (1,595) Income before income taxes 155,381 101,948 99,850 Income tax benefit (5,749) (2,489) (3,619) Net income 161,130 104,437 103,469 Other comprehensive income (loss), net of tax Foreign currency translation adjustments (11,129) (7,970) 4,754 Loss on cash flow hedges 11,151 (10,275) (10,974) Unrealized gain on change in fair value of debt securities available-for-sale 109 — — Total comprehensive income $ 161,261 $ 86,192 $ 97,249 Condensed Statements of Cash Flows Years ended December 31, (In thousands) 2021 2020 2019 Cash flows from operating activities $ 47,590 $ 29,817 $ 55,092 Cash flows from financing activities Dividends paid (14,409) (14,382) (14,420) Repurchase of common stock (24,388) (7,300) (31,822) Withholding taxes paid on share-based compensation (8,793) (8,134) (8,849) Net cash used in financing activities (47,590) (29,816) (55,091) Net change in cash — 1 1 Cash at beginning of the period 1,680 1,679 1,678 Cash at end of the period $ 1,680 $ 1,680 $ 1,679 |
The Company and Summary of Si_2
The Company and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
The Company | The Company EVERTEC, 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 services. 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 the Caribbean and 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 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. |
Basis of Presentation | Basis of Presentation The consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, the accompanying consolidated financial statements, prepared in accordance with GAAP, contain all adjustments, all of which are normal and recurring in nature, necessary for a fair presentation. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts and operations of the Company, which are presented in accordance with GAAP. The Company consolidates all wholly owned subsidiaries and subsidiaries that are majority owned. Intercompany accounts and transactions are eliminated in the consolidated financial statements. |
Use of Estimates | Use of Estimates The preparation of the accompanying consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. |
Revenue Recognition | Revenue Recognition The Company’s revenue recognition policy follows the guidance from Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers , which provide guidance on the recognition, presentation, and disclosure of revenue in consolidated financial statements. The Company recognizes revenue when (or as) control of goods or services are transferred to a customer. The transfer of control occurs when the customer can direct the use of and receive substantially all the benefits from the transferred good or service. Therefore, revenue is recognized over time (typically for services) or at a point in time (typically for goods). The assessment of revenue recognition is performed by the Company based on the five-step model established in ASC 606, as follows: Step 1: Identify the contract with customer; Step 2: Identify the performance obligations in the contract; Step 3: Determine the transaction price; Step 4: Allocate the transaction price to the performance obligations in the contract; and Step 5: Recognize revenue when or as the entity satisfies a performance obligation. At contract inception, the Company evaluates whether the contract (i) is legally enforceable; (ii) approved by both parties; (iii) properly defines rights and obligations of the parties, including payment terms; (iv) has commercial substance; and (v) collection of substantially all consideration entitled is probable, before proceeding with the assessment of revenue recognition. If any of these requirements is not met, the contract does not exist for purposes of the model and any consideration received is recorded as a liability. A reassessment may be performed in a later date upon change in facts and circumstances. The Company also evaluates within this step if contracts issued within a period of 6 months with the same customer should be accounted for as a single contract. The Company’s contracts with customers may be modified through amendments, change requests or waivers. Upon receipt, modifications of contracts with customers are evaluated to determine if these must be accounted for: (i) as a separate contract, (ii) a cumulative catch-up, or (iii) as a termination and creation of a new contract. Contract modifications must also comply with the requirements to determine if a contract with a customer exists for accounting purposes. To identify performance obligations within contracts with customers, the Company first identifies all the promises in the contract (i.e., explicit and implicit). This includes the customer’s options to acquire additional goods or services for free or at a discount in exchange for an upfront payment. The Company then assesses if each material good or service (or bundle of goods or services) is distinct in nature (i.e., the customer can benefit from the good or service on its own or together with other readily available resources) and is capable of being distinct in the context of the contract (i.e., the promise to transfer the good or service is separately identifiable from other promises in the contract). A distinct good or service (or bundle of goods or services) constitutes a performance obligation. The Company also applies the series guidance to distinct goods or services (either with a specified quantity of goods or services or a stand-ready service), with an over time revenue recognition, to determine whether they should be accounted for as a single performance obligation. These distinct goods or services are recognized as a single performance obligation when their nature and timely increments are substantially the same and have the same pattern of transfer to the customer (i.e., the distinct goods or services within the series use the same method to measure progress towards complete satisfaction). To determine if a performance obligation should be recognized over time, one or more of the following criteria must be met: (1) the customer simultaneously receives and consumes the benefits as the Company performs (i.e., routine or recurring services); (2) the customer controls the asset as the entity creates or enhances it (i.e., asset on customer’s site); or (3) the Company’s performance does not create an asset for which the Company has an alternative use and there is a right to payment for performance to date (i.e., asset built to order). Performance obligations that do not meet the over time criteria are recognized at a point in time. In addition, in Step 2 of the model, the Company evaluates whether the practical expedient of right-to-invoice applies. If this practical expedient is applicable, steps 3, 4 and 5 are waived. For this practical expedient to apply, the right to consideration must correspond directly with the value received by the customer for the Company’s performance to date, no significant up-front payments or retroactive adjustments must exist, and specified minimums must be deemed non-substantive at the contract level. If the contract with the customer has multiple performance obligations and the practical expedient of right-to-invoice does not apply, the Company proceeds to determine the transaction price and allocate it on a standalone selling price basis among the different performance obligations identified in the Step 2. The Company generally applies the expected cost plus margin approach to determine the standalone selling price at the performance obligation level. In addition, for performance obligations that are satisfied over time and the right to invoice practical expedient is not available, the Company determines a method to measure progress (i.e., input or output method) based on current facts and circumstances. When these performance obligations have variable consideration within its transaction price and are part of a series, the Company allocates the variable consideration to each time increment. As part of the revenue recognition analysis, when another party is involved in providing goods or services to a customer, the Company evaluates, for each performance obligation, whether it is providing the goods or services itself (i.e., as principal), or if it is only arranging on behalf of the other party. The Company acts as principal if it controls the specified good or service before that good or service is transferred to a customer. To determine if the Company acts as an agent, the Company considers indicators, such as: (i) the responsibility to fulfill a promise; (ii) the inventory risk; and (iii) the price determination. |
Investment in Equity Investee | Investment in Equity Investee The Company accounts for investments using the equity method of accounting if the investment provides the Company the ability to exercise significant influence, but not control, over an investee. Significant influence is generally deemed to exist if the Company has an ownership interest in the voting stock of an investor of between 20 percent and 50 percent, although other factors are considered in determining whether the equity method of accounting is appropriate. Under this method, the investment, originally recorded at cost, is adjusted to recognize the Company’s share of net income or losses as they occur. The Company’s share of investee earnings or losses is recorded, net of taxes, within earnings (losses) of equity method investment caption in the consolidated statements of income and comprehensive income. The Company’s consolidated revenues include fees for services provided to an investee accounted for under the equity method. Additionally, the Company’s interest in the net assets of its equity method investee is reflected in the consolidated balance sheets. On the acquisition of the investment, any difference between the cost of the investment and the amount of the underlying equity in net assets of an investee is required to be accounted as if the investee were a consolidated subsidiary. If the difference is assigned to depreciable or amortizable assets or liabilities, then the difference should be amortized or accreted in connection with the equity earnings based on the Company’s proportionate share of the investee’s net income or loss. If the investor is unable to relate the difference to specific accounts of the investee, the difference should be considered goodwill. The Company considers whether the fair value of its equity method investment has declined below its carrying value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If the Company considered any such decline to be other than temporary (based on various factors, including historical financial results, product development activities and the overall health of the investee’s industry), then the Company would record a write-down to estimated fair value. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method and expensed over their estimated useful lives. Amortization of leasehold improvements is computed over the terms of the respective leases, including renewal options considered by management to be reasonably assured of being exercised, or the estimated useful lives of the improvements, whichever is shorter. Costs of maintenance and repairs which do not improve or extend the life of the respective assets are expensed as incurred. |
Leases | Leases The Company’s leases accounting policy follows the guidance from ASC 842, Leases, which provides guidance on the recognition, presentation, and disclosure of leases in consolidated financial statements. The Company determines if an arrangement is or contains a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease payable, and operating lease liabilities in the consolidated balance sheets. Finance leases are included in property and equipment and accrued liabilities in the consolidated balance sheets. ROU assets and lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. As most of the Company’s leases do not provide an implicit rate, Management uses the Company’s collateralized incremental borrowing rate (“IBR”) based on the information available at commencement date in determining the present value of future payments. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. We monitor events or changes in circumstances that change the timing or amount of future lease payments which results in the remeasurement of a lease liability, with a corresponding adjustment to the ROU asset. The lease payment terms may include fixed payment terms and variable payments. Fixed payment terms and variable payments that depend on an index (i.e., Consumer Price Index or “CPI”) or rate are considered in the determination of the operating lease liabilities. While lease liabilities are not remeasured because of changes to the CPI, changes are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. Variable payments that do not depend on an index or rate are not included in the lease liabilities determination. Rather, these payments are recognized as variable lease expense when incurred. Variable lease payments are included within operating costs and expenses in the consolidated statements of income and comprehensive income. For operating leases, lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For finance leases, lease expense is composed of interest expense and amortization expense. The lease liability of these leases is measured using the interest rate method. The ROU asset from financing leases is amortized on a straight-line basis, and is presented as part of Property and Equipment, net. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets Long-lived assets to be held and used, and long-lived assets to be disposed of, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. |
Capitalization of Software | Capitalization of Software The Company develops software that is used in providing processing services to customers. Capitalized software includes purchased software and internally developed software and is recognized as software packages within the other intangible assets line item in the consolidated balance sheets. Capitalization of internally developed software occurs only after the preliminary project stage is complete, management with applicable authority approves funding of the project, it is probable that the project will be completed, and the software will be used to perform the intended function. Tasks that are generally capitalized are as follows: (a) system design of a chosen path including software configuration and software interfaces; (b) employee costs directly associated with the internal-use computer software project; (c) software development (coding) and software and system testing and verification; (d) system installation; and (e) enhancements that add function and are considered permanent. These tasks are capitalized and amortized using the straight-line method over its estimated useful life, which range from three |
Software and Maintenance Contracts | Software and Maintenance Contracts Software and maintenance contracts are recorded at cost. The cost is recognized as prepaid expenses and amortized over the term of the related contract. The unamortized balance is included within prepaid expenses and other assets or other long-term assets depending on their remaining useful lives. Amortization of software and maintenance contracts is computed using the straight-line method and their estimated useful lives range from one |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill represents the excess of the purchase price and related costs over the value assigned to net assets acquired. Goodwill is not amortized, but is tested for impairment at least annually, or more often if events or circumstances indicate there may be impairment. The Company first assesses qualitative factors to determine whether it is necessary to perform the quantitative impairment test. If determined to be necessary, the quantitative impairment test shall be used to identify goodwill impairment and measure the amount of a goodwill impairment loss to be recognized (if any). The Company may assess qualitative factors to determine whether it is more likely than not, that is, a likelihood of more than 50 percent that the fair value of the reporting unit is less than its carrying amount, including goodwill. The Company has an unconditional option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the quantitative goodwill impairment test. The Company may resume performing the qualitative assessment in any subsequent period. The quantitative goodwill impairment test, used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of a reporting unit with its carrying amount, including goodwill. If the Company determines to perform a quantitative impairment test, a third-party valuator may be engaged to prepare an independent valuation of each reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. Additionally, the Company shall consider the income tax effect from any tax-deductible goodwill on the carrying amount of the reporting unit, if applicable, when measuring the goodwill impairment loss. For the years ended December 31, 2021, 2020 and 2019, no impairment losses associated with goodwill were recognized. Other identifiable intangible assets with definitive useful lives are amortized using the straight-line method or accelerated methods. These intangibles are evaluated periodically for impairment when events or changes in circumstances indicate that the carrying amounts may not be recoverable. Other identifiable intangible assets with definitive useful lives include customer relationships, trademarks, software packages and a non-compete agreement. Customer relationships were valued using the excess earnings method under the income approach. Trademark assets were valued using the relief-from-royalty method under the income approach. Internally developed software packages, which include capitalized software development costs, are recorded at cost, while software packages acquired as part of a business combination were valued using the relief-from-royalty method under the income approach. The non-compete agreement was valued based on the estimated impact that theoretical competition would have on revenues and expenses. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging ActivitiesThe Company uses derivative financial instruments to enhance its ability to manage its exposure to certain financial and market risks. On the date the derivative instrument contract is entered into, the Company may designate the derivative as (1) a hedge of the fair value of a recognized asset or liability or an unrecognized firm commitment (“fair value” hedge), (2) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (“cash flow” hedge), or (3) as a “standalone” derivative instrument, including economic hedges that the Company has not formally documented as a fair value or cash flow hedge. Changes in the fair value of a derivative that qualifies for cash flow hedge accounting are recognized in Other Comprehensive Income (Loss). Amounts accumulated in other comprehensive income (loss) are reclassified to earnings when the related cash outflow affects earnings. Changes in the fair value of a derivative instrument that is highly effective and that is designated and qualifies as a fair value hedge, along with changes in the fair value of the hedged asset or liability that are attributable to the hedged risk (including gains or losses on firm commitments), are recorded in current-period earnings. Similarly, the changes in the fair value of stand-alone derivative instruments or derivatives not qualifying or designated for hedge accounting are reported in current-period earnings. The Company recognizes all derivative financial instruments in the consolidated balance sheets as assets or liabilities at fair value. The Company presents derivative assets and derivative liabilities separately in the consolidated balance sheets. The Company does not enter into derivative financial instruments for speculative purposes. |
Income Tax | Income Tax Income taxes are accounted for under the asset and liability method. A temporary difference refers to a difference between the tax basis of an asset or liability, determined based on recognition and measurement requirements for tax positions, and its reported amount in the financial statements that will result in taxable or deductible amounts in future years when the reported amount of the asset or liability is recovered or settled, respectively. Deferred tax assets and liabilities represent the future effects on income taxes that result from temporary differences and carryforwards that exist at the end of a period. Deferred tax assets and liabilities are measured using enacted tax rates and provisions of the enacted tax law and are not discounted to reflect the time-value of money. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of income and comprehensive income in the period that includes the enactment date. A deferred tax valuation allowance is established if it is considered more likely than not that all or a portion of the deferred tax asset will not be realized. The Company recognizes the benefit of uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement or disposition of the underlying issue with the taxing authority. Accordingly, the amount of benefit recognized in the consolidated financial statements may differ from the amount taken or expected to be taken in the tax return resulting in unrecognized tax benefits (“UTBs”). The Company recognizes the interest and penalties associated with UTBs as part of the provision for income taxes on its consolidated statements of income and comprehensive income. Accrued interest and penalties are included on the related tax liability line in the consolidated balance sheets. All companies within EVERTEC are legal entities that file separate income tax returns. |
Cash and cash equivalents | Cash and cash equivalents Cash includes cash on hand and in banks. Cash equivalents consist of certificates of deposits with original maturities of three months or less. |
Restricted Cash | Restricted CashRestricted cash represents cash received on deposits from participating institutions of the ATH network that has been segregated for the development of the ATH brand and cash maintained as collateral for a credit facility with Popular. Also, restricted cash includes a reserve account for payment and transaction processing services to merchants. Prior to the sale in 2021 of assets related to the Ticketpop business and subsequent exit from this business, restricted cash also included cash collected from the Ticketpop business. The restrictions of these accounts are based on contractual provisions entered into with third parties. This cash is maintained in separate accounts at a financial institution in Puerto Rico. |
Debt Securities | Debt Securities Debt securities available-for-sale are accounted for under the provisions of the Accounting Standards Codification ("ASC") 320 Investments – Debt and Equity Securities , which requires that debt securities available-for-sale ("AFS") be carried at fair value on the Company’s consolidated balance sheets with unrealized gains (losses) generally recorded through other comprehensive income (“OCI”). Debt securities in an unrealized loss position which the Company intends to sell or for which it is more likely than not that the Company will be required to sell before recovery of the amortized cost basis, are written down to fair value through income. Quarterly, for debt securities in an unrealized loss position that the Company does not intend or will, more likely than not, not be required to sell, the Company evaluates if the decline in fair value has resulted from credit losses or other factors. If it is determined that the decline in fair value is related to credit losses, the Company records an allowance for credit losses, limited to the amount by which the fair value is less than the amortized cost basis. If the Company determines that the decline in value is related to factors other than credit, the Company recognizes the impairment through OCI. |
Allowance for Current Expected Credit Losses | Allowance for Current Expected Credit LossesThe Company monitors trade receivable balances and estimates the allowance for current expected credit losses based on historical loss rates adjusted by macroeconomic factors. Receivables are considered past due if full payment is not received by the contractual date. Past due accounts are generally written off against the allowance for current expected credit losses, only after all collection attempts have been exhausted. |
Foreign Currency Translation | Foreign Currency Translation Assets and liabilities denominated in foreign currencies are translated to U.S. dollars using prevailing rates of exchange at the end of the period. Revenues, expenses, gains and losses are translated using weighted average rates for the period. The resulting foreign currency translation adjustment from operations for which the functional currency is other than the U.S. dollar is reported in accumulated other comprehensive loss. Gains and losses on transactions denominated in currencies other than the functional currencies are included in determining net income for the period in which exchange rates change. |
Share-based Compensation | Share-based Compensation The Company estimates the fair value of stock-based awards, on a contemporaneous basis, at the date they are granted using the Monte Carlo simulation analysis for market based restricted stock units (“RSUs”) using the following assumptions: (1) stock price; (2) risk-free rate; (3) expected volatility; (4) expected annual dividend yield and (5) expected term. The risk-free rate is based on the U.S. Constant Maturities Treasury Interest Rate as of the grant date or the yield of a 2-year or 3-year Treasury bond, as applicable. The expected volatility is based on a combination of historical volatility and implied volatility from publicly traded companies in the Company’s industry. The expected annual dividend yield is based on management’s expectations of future dividends as of the grant date and, in certain cases, assumes that those dividends will be reinvested over the performance period. Performance and time based RSUs and restricted stock are valued based on the market price of the Company’s stock at the grant date. |
Net Income Per Common Share | Net Income Per Common Share Basic net income per common share is determined by dividing net income by the weighted-average number of common shares outstanding during the period. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently adopted accounting pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued updated guidance for Accounting Standards Codification (“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 adoption of these amendments did not have a material impact on the Company’s consolidated financial statements. Recently issued accounting pronouncements not yet adopted In October 2021, the FASB issued ASC 805, Business Combinations, to require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. The Company will apply this guidance to business combinations once applicable. In March 2020, the FASB issued guidance under 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 adoption of this guidance will not have an impact on the Company's consolidated financial statements. |
Recurring Fair Value Measurements | Recurring Fair Value Measurements Fair value measurement provisions establish a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These provisions describe three levels of input that may be used to measure fair value: Level 1: Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level 2: Inputs, other than quoted prices included in Level 1, which are observable for the asset or liability through corroboration with market data at the measurement date. Level 3: Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The Company uses observable inputs when available. Fair value is based upon quoted market prices when available. If market prices are not available, the Company may employ models that mostly use market-based inputs including yield curves, interest rates, volatilities, and credit curves, among others. The Company limits valuation adjustments to those deemed necessary to ensure that the financial instrument’s fair value adequately represents the price that would be received or paid in the marketplace. Valuation adjustments may include consideration of counterparty credit quality and liquidity as well as other criteria. The estimated fair value amounts are subjective in nature and may involve uncertainties and matters of significant judgment for certain financial instruments. Changes in the underlying assumptions used in estimating fair value could affect the results. The fair value measurement levels are not indicative of risk of investment. The fair value of financial instruments is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value estimates are made at a specific point in time based on the type of financial instrument and relevant market information. Many of these estimates involve various assumptions and may vary significantly from amounts that could be realized in actual transactions. |
Debt Securities (Tables)
Debt Securities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Debt securities available-for-sale by contractual maturity | The amortized cost, gross unrealized gains and losses recorded in OCI, and estimated fair value as of December 31, 2021 were as follows: December 31, 2021 (In thousands) Gross unrealized Amortized cost Gains Losses Fair Value Costa Rica Government Obligations After 1 to 5 years $ 2,963 $ 78 $ — $ 3,041 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | In the following table, revenue for each segment, excluding intersegment revenues, is disaggregated by timing of revenue recognition for the periods indicated. Year ended on December 31, 2021 (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 $ 168 $ 2,045 $ — $ 8,882 $ 11,095 Products and services transferred over time 104,624 95,187 143,965 234,925 578,701 $ 104,792 $ 97,232 $ 143,965 $ 243,807 $ 589,796 Year ended on December 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 $ 134 $ 1,448 $ — $ 9,482 $ 11,064 Products and services transferred over time 88,138 76,115 109,788 225,483 499,524 $ 88,272 $ 77,563 $ 109,788 $ 234,965 $ 510,588 Year ended on December 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 $ 3,041 $ 3,811 $ — $ 10,421 $ 17,273 Products and services transferred over time 82,487 74,985 106,388 206,241 470,101 $ 85,528 $ 78,796 $ 106,388 $ 216,662 $ 487,374 |
Summary of Contract Balances | The following table provides information about contract assets from contracts with customers. December 31, (In thousands) 2021 2020 Balance at beginning of period $ 2,796 $ 1,191 Services transferred to customers 5,374 3,934 Transfers to accounts receivable (6,455) (2,329) Balance at end of period $ 1,715 $ 2,796 |
Accounts Receivable and Allow_2
Accounts Receivable and Allowance for Current Expected Credit Losses (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Receivables [Abstract] | |
Summary of Accounts Receivable, Net | Accounts receivable, net consisted of the following: December 31, (In thousands) 2021 2020 Trade $ 66,255 $ 58,701 Due from affiliates, net 38,120 28,419 Settlement assets 11,417 10,641 Other 16 367 Less: allowance for current expected credit losses (2,523) (2,401) Accounts receivable, net $ 113,285 $ 95,727 |
Schedule of Allowance for Credit Losses on Trade Receivables | The activity in the allowance for current expected credit losses on trade receivables were as follows: (In thousands) December 31, 2021 December 31, 2020 Balance at the beginning of the period $ 2,401 $ 3,460 Current period provision for expected credit losses 819 832 Write-offs (698) (1,894) Recoveries of amounts previously written-off 1 3 Balance at the end of the period $ 2,523 $ 2,401 |
Prepaid Expenses and Other As_2
Prepaid Expenses and Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Summary of Prepaid Expenses and Other Assets | Prepaid expenses and other assets consisted of the following: December 31, (In thousands) 2021 2020 Software maintenance contracts $ 11,629 $ 10,745 Deferred project costs 4,927 11,614 Prepaid cloud computing arrangement fees 4,453 2,145 Prepaid income taxes 4,080 3,757 Taxes other than on income 2,405 2,390 Insurance 2,286 2,335 Postage 2,078 1,906 Contract assets 1,677 2,661 Guarantee deposits 850 2,648 Other 2,763 2,013 Prepaid expenses and other assets $ 37,148 $ 42,214 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment, Net | Property and equipment, net consisted of the following: Useful life December 31, (Dollar amounts in thousands) 2021 2020 Buildings 30 $ 1,359 $ 1,437 Data processing equipment 3 - 5 141,359 124,897 Furniture and equipment 3 - 20 7,718 6,691 Leasehold improvements 5 - 10 3,277 3,098 153,713 136,123 Less—accumulated depreciation and amortization (106,365) (93,826) Depreciable assets, net 47,348 42,297 Land 1,185 1,241 Property and equipment, net $ 48,533 $ 43,538 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill Allocated by Reportable Segments | The changes in the carrying amount of goodwill, allocated by reporting unit, were as follows: (In thousands) Payment Payment Merchant Business Total Balance at December 31, 2019 $ 160,972 $ 54,571 $ 138,121 $ 45,823 $ 399,487 Foreign currency translation adjustments — (1,817) — — (1,817) Balance at December 31, 2020 160,972 52,754 138,121 45,823 397,670 Foreign currency translation adjustments — (4,352) — — (4,352) Balance at December 31, 2021 $ 160,972 $ 48,402 $ 138,121 $ 45,823 $ 393,318 |
Other Intangible Assets, Net (T
Other Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying Amount of Other Intangible Assets | The carrying amount of other intangible assets consisted of the following: Useful life in years December 31, 2021 (In thousands) Gross Accumulated Net carrying Customer relationships 8 - 14 $ 357,991 $ (272,732) $ 85,259 Trademark 2 - 15 41,901 (36,684) 5,217 Software packages 3 - 10 326,320 (217,643) 108,677 Non-compete agreement 15 56,539 (42,404) 14,135 Other intangible assets, net $ 782,751 $ (569,463) $ 213,288 Useful life in years December 31, 2020 (In thousands) Gross Accumulated Net carrying Customer relationships 8 - 14 $ 343,981 $ (246,088) $ 97,893 Trademark 2 - 15 42,036 (35,467) 6,569 Software packages 3 - 10 289,205 (191,662) 97,543 Non-compete agreement 15 56,539 (38,635) 17,904 Other intangible assets, net $ 731,761 $ (511,852) $ 219,909 |
Estimated Amortization Expenses | The estimated amortization expense of balances outstanding at December 31, 2021 for the next five years are as follows: (In thousands) 2022 $ 52,534 2023 47,157 2024 35,139 2025 12,074 2026 5,607 |
Debt and Short-Term Borrowings
Debt and Short-Term Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Summary of Total Debt | Total debt was as follows: December 31, (In thousands) 2021 2020 2023 Term A Loan bearing interest at a variable interest rate (LIBOR plus applicable margin (1)(2) ) $ 170,875 $ 188,788 2024 Term B Loan bearing interest at a variable interest rate (LIBOR plus applicable margin (1)(3) ) 293,660 306,503 Notes Payable due on January 1, 2022 (1) 758 1,443 Total debt $ 465,293 $ 496,734 (1) Net of unaccreted discount and unamortized debt issue costs, as applicable. (2) Applicable margin of 1.75% at December 31, 2021 and December 31, 2020. (3) Subject to a minimum rate (“LIBOR floor”) of 0.00% plus applicable margin of 3.50% at December 31, 2021 and December 31, 2020. |
Summary of Contractual Principal Payments | The following table presents contractual principal payments for the next years: (In thousands) 2022 $ 19,750 2023 158,364 2024 289,344 Thereafter — |
Schedule of Interest Rate Swap Transaction | As of December 31, 2021, the Company has an interest rate swap agreement, entered into in December 2018, which converts 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 2018 Swap April 2020 November 2024 $250 million 1-month LIBOR 2.89% |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements for Assets and Liabilities at Fair Value on Recurring Basis | The following table summarizes fair value measurements by level at December 31, 2021 and 2020, for assets and liabilities measured at fair value on a recurring basis: (In thousands) Level 1 Level 2 Level 3 Total December 31, 2021 Financial asset: Costa Rica Government Obligations $ — $ 3,041 $ — $ 3,041 Financial liability: Interest rate swap $ — $ 13,392 $ — $ 13,392 December 31, 2020 Financial liability: Interest rate swap $ — $ 25,578 $ — $ 25,578 |
Carrying Value and Estimated Fair Values for Financial Instruments | The following table presents the carrying value, as applicable, and estimated fair values for financial instruments at December 31, 2021 and 2020: December 31, 2021 2020 (In thousands) Carrying Fair Carrying Fair Financial asset: Costa Rica Government Obligations $ 3,041 $ 3,041 $ — $ — Financial liabilities: Interest rate swap $ 13,392 $ 13,392 $ 25,578 $ 25,578 2023 Term A Loan 170,875 168,610 188,788 186,678 2024 Term B Loan 293,660 294,735 306,503 308,336 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Summary of Dividend Activity | The Company’s dividend activity in 2021 and 2020 was as follows: Declaration Date Record Date Payment Date Dividend per share February 20, 2020 March 4, 2020 April 3, 2020 0.05 April 21, 2020 May 4, 2020 June 5, 2020 0.05 July 24, 2020 August 3, 2020 September 4, 2020 0.05 October 20, 2020 November 2, 2020 December 4, 2020 0.05 February 18, 2021 March 1, 2021 March 26, 2021 0.05 April 22, 2021 May 3, 2021 June 4, 2021 0.05 July 22, 2021 August 2, 2021 September 3, 2021 0.05 October 21, 2021 November 1, 2021 December 3, 2021 0.05 |
Summary of Changes in Balances Comprising Accumulated Other Comprehensive Loss | The following table provides a summary of the changes in the balances comprising accumulated other comprehensive loss for the years ended December 31, 2021 and 2020: Foreign Currency Cash Flow Hedge Unrealized Gains on Debt Securities AFS Total Balance - December 31, 2019, net of tax $ (16,872) $ (13,137) — $ (30,009) Other comprehensive loss before reclassifications (7,970) (15,341) — (23,311) Effective portion reclassified to net income — 5,066 — 5,066 Balance - December 31, 2020, net of tax (24,842) (23,412) — (48,254) Other comprehensive (loss) income before reclassifications (11,129) 4,086 109 (6,934) Effective portion reclassified to net income — 7,065 — 7,065 Balance - December 31, 2021, net of tax $ (35,971) $ (12,261) $ 109 $ (48,123) |
Share-based Compensation (Table
Share-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Nonvested Restricted Shares and RSUs Activity | The following table summarizes the nonvested restricted shares and RSUs activity for the years ended December 31, 2021, 2020 and 2019: Nonvested restricted shares and RSUs Shares Weighted average Nonvested at December 31, 2018 2,036,163 $ 15.09 Granted 517,153 30.84 Vested (931,389) 29.32 Forfeited (29,172) 16.52 Nonvested at December 31, 2019 1,592,755 20.71 Granted 413,733 31.62 Vested (762,194) 16.65 Forfeited (150,779) 19.22 Nonvested at December 31, 2020 1,093,515 27.88 Granted 705,970 31.93 Vested (683,706) 20.95 Forfeited (29,450) 33.36 Nonvested at December 31, 2021 1,086,329 $ 34.73 |
Share-Based Compensation Recognized | Share-based compensation recognized was as follows: Years ended December 31, (In thousands) 2021 2020 2019 Share-based compensation recognized, net Restricted shares and RSUs $ 14,799 $ 14,253 $ 13,570 |
Income Tax (Tables)
Income Tax (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax Expense (Benefit) | The components of income tax expense consisted of the following: Years ended December 31, (In thousands) 2021 2020 2019 Current tax provision $ 23,388 $ 22,907 $ 19,366 Deferred tax benefit (2,826) (3,905) (6,391) Income tax expense $ 20,562 $ 19,002 $ 12,975 |
Segregation of Income Tax Expense (Benefit) Based on Location of Operations | The following table presents the components of income tax expense and its segregation based on location of operations: Years ended December 31, (In thousands) 2021 2020 2019 Income before income tax provision Puerto Rico $ 148,331 $ 98,608 $ 89,667 United States 622 3,953 4,047 Foreign countries 32,752 21,292 22,961 Total income before income tax provision $ 181,705 $ 123,853 $ 116,675 Current tax provision Puerto Rico $ 6,792 $ 7,260 $ 7,550 United States 137 612 339 Foreign countries 16,459 15,035 11,477 Total current tax provision $ 23,388 $ 22,907 $ 19,366 Deferred tax (benefit) provision Puerto Rico $ (2,428) $ (2,087) $ (4,109) United States 109 1,041 (216) Foreign countries (507) (2,859) (2,066) Total deferred tax benefit $ (2,826) $ (3,905) $ (6,391) |
Components of Deferred Tax Assets and Liabilities | The following table presents the components of the Company’s deferred tax assets and liabilities: December 31, (In thousands) 2021 2020 Deferred tax assets (“DTA”) Allowance for doubtful accounts $ 175 $ 223 Unearned income 10,475 11,058 Lease liability 2,655 3,410 Share-based compensation 1,181 1,163 Debt issuance costs 132 189 Accrued liabilities 3,263 1,828 Derivative liability 1,036 2,070 Accrual of contract maintenance cost 84 110 Impairment of asset 290 310 Other 1,596 1,649 Total gross deferred tax assets 20,887 22,010 Deferred tax liabilities (“DTL”) Capitalized salaries 2,193 2,095 Difference between the assigned values and the tax basis of assets and liabilities recognized in business combinations 7,978 10,507 Right of use asset 2,707 3,340 Other 3,468 3,086 Total gross deferred tax liabilities 16,346 19,028 Deferred tax asset (liability), net $ 4,541 $ 2,982 |
Summary of Operating Loss Carryforwards | The NOL balance as of December 31, 2021 expires as follows: (In thousands) 2026 $ 51 2028 688 2029 1,558 2030 4,112 2031 3,737 2033 178 Indefinitely 1,072 |
Reconciliation of Total Amounts of Unrecognized Tax Benefits | The following is a tabular reconciliation of the total amounts of UTPs: Years ended December 31, (In thousands) 2021 2020 2019 Balance, beginning of year $ 5,908 $ 9,146 $ 9,238 Gross increases—tax positions in prior period 431 1,335 — Gross decreases—tax positions in prior period (101) (192) (92) Lapse of statute of limitations (2,287) (4,381) — Balance, end of year $ 3,951 $ 5,908 $ 9,146 |
Income Tax Expense Differs from Computed Income Tax at Statutory Rates | The income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate of 37.5% to the income before income taxes as a result of the following: Years ended December 31, (In thousands) 2021 2020 2019 Computed income tax at statutory rates $ 68,139 $ 46,445 $ 43,753 Differences in tax rates due to multiple jurisdictions 2,003 839 1,058 Excess tax benefits on share-based compensation (1,023) (1,094) (1,779) Effect of income subject to tax-exemption grant (46,762) (31,347) (31,424) Unrecognized tax (benefit) expense (3,388) 1,322 (32) Other, net 1,593 2,837 1,399 Income tax expense $ 20,562 $ 19,002 $ 12,975 |
Net Income Per Common Share (Ta
Net Income Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Reconciliation of Numerator and Denominator of Income Per Common Share | The reconciliation of the numerator and the denominator of the earnings per common share is as follows: Years ended December 31, ( Dollar amounts in thousands, except share and per share data) 2021 2020 2019 Net income attributable to EVERTEC, Inc.’s common stockholders $ 161,130 $ 104,436 $ 103,469 Less: non-forfeitable dividends on restricted stock — — 3 Net income available to EVERTEC, Inc.'s common shareholders $ 161,130 $ 104,436 $ 103,466 Weighted average common shares outstanding 72,053,795 71,943,965 72,099,755 Weighted average potential dilutive common shares (1) 816,790 1,107,240 1,376,008 Weighted average common shares outstanding—assuming dilution 72,870,585 73,051,205 73,475,763 Net income per common share—basic $ 2.24 $ 1.45 $ 1.44 Net income per common share—diluted $ 2.21 $ 1.43 $ 1.41 (1) Potential common shares consist of common stock issuable under RSUs awards using the treasury stock method. |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Summary of Transactions with Related Parties | The following table presents the Company’s transactions with related parties for each of the periods presented below: Years ended December 31, (In thousands) 2021 2020 2019 Total revenues (1)(2) $ 245,613 $ 226,074 $ 209,053 Cost of revenues $ 2,610 $ 4,317 $ 5,094 Rent and other fees $ 7,487 $ 8,320 $ 8,519 Interest earned from an affiliate Interest income $ 647 $ 391 $ 161 (1) Popular, Inc. ("Popular") revenues as a percentage of total revenues were 42%, 44% and 43%, respectively, for each of the periods presented above. (2) Includes revenues generated from investee accounted for under the equity method of $0.3 million, $0.6 million and $1.1 million for the years ended December 31, 2021, 2020 and 2019, respectively. |
Balances of Transactions with Related Parties | As of December 31, 2021 and 2020, EVERTEC had the following balances arising from transactions with related parties: December 31, (In thousands) 2021 2020 Cash and restricted cash deposits in affiliated bank $ 187,602 $ 126,189 Other due/to from affiliate Accounts receivable $ 38,120 $ 28,419 Prepaid expenses and other assets $ 1,763 $ 4,678 Operating lease right-of use assets $ 13,533 $ 17,099 Other long-term assets $ 2,853 $ — Accounts payable $ 5,601 $ 4,607 Unearned income $ 40,982 $ 35,807 Operating lease liabilities $ 14,019 $ 17,781 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Components of Lease Expense | Total lease cost consisted of the following: Years ended December 31, (in thousands) 2021 2020 Operating lease cost $ 6,948 $ 7,025 Variable lease cost 2,472 3,182 Total lease costs $ 9,420 $ 10,207 Other Balance Sheet information related to operating leases was as follows: December 31, (In thousands) 2021 2020 Right-of-use assets obtained in exchange for operating lease obligations 178 $ 3,496 Weighted average remaining lease term, in years 4 5 Weighted Average Discount Rate 2.3% 2.8% |
Maturities of Operating Lease Liabilities | The following table presents the balance of Operating lease obligations: December 31, (In thousands) 2021 2020 Operating lease liability - current 5,580 5,830 Operating lease liability - long-term 16,456 22,402 Total operating lease liabilities $ 22,036 $ 28,232 Future minimum operating lease payments at December 31, 2021 were as follows: (In thousands) 2022 6,387 2023 6,036 2024 5,123 2025 4,072 2026 871 Thereafter 1,617 Total future minimum lease payments 24,106 Less: imputed interest (2,070) Total $ 22,036 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Summary of Operations by Business Segments | The following tables set forth information about the Company’s operations by its four business segments for the periods indicated: December 31, 2021 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 155,392 $ 105,963 $ 143,965 $ 243,807 $ (59,331) $ 589,796 Operating costs and expenses 84,742 86,152 75,795 150,433 (3,840) 393,282 Depreciation and amortization 16,085 11,395 3,583 18,930 25,077 75,070 Non-operating income (expenses) 842 8,216 1,107 3,056 (7,109) 6,112 EBITDA 87,577 39,422 72,860 115,360 (37,523) 277,696 Compensation and benefits (2) 1,702 3,080 1,012 1,775 7,575 15,144 Transaction, refinancing, and other fees (3) 660 — — (647) 1,965 1,978 Adjusted EBITDA $ 89,939 $ 42,502 $ 73,872 $ 116,488 $ (27,983) $ 294,818 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $42.4 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction processing of $9.2 million from Payment Services- Latin America to both Payment Services- Puerto Rico & Caribbean and Business Solutions, and transaction processing and monitoring fees of $7.6 million from Payment Services - Puerto Rico & Caribbean to Payment Services - Latin America. (2) Primarily represents share-based compensation and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement, the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of dividends received, a software impairment charge and a gain from sale of assets. December 31, 2020 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 124,771 $ 84,641 $ 109,788 $ 234,965 $ (43,577) $ 510,588 Operating costs and expenses 72,968 73,030 58,163 141,446 23,589 369,196 Depreciation and amortization 13,455 11,299 1,905 17,551 27,308 71,518 Non-operating income (expenses) 202 6,934 650 1,938 (3,691) 6,033 EBITDA 65,460 29,844 54,180 113,008 (43,549) 218,943 Compensation and benefits (2) 987 2,934 926 1,794 7,742 14,383 Transaction, refinancing, exit activity and other fees (3) 500 — — — 6,641 7,141 Adjusted EBITDA $ 66,947 $ 32,778 $ 55,106 $ 114,802 $ (29,166) $ 240,467 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $34.6 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring and intercompany software sale and developments of $9.0 million from Payment Services- Latin America to Payment Services- Puerto Rico & Caribbean. (2) Primarily represents share-based compensation. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the 2018 Credit Agreement, an impairment charge and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A. December 31, 2019 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 125,544 $ 84,453 $ 106,388 $ 216,662 $ (45,673) $ 487,374 Operating costs and expenses 61,396 65,701 62,098 138,224 15,453 342,872 Depreciation and amortization 11,646 9,930 1,814 16,529 28,163 68,082 Non-operating income (expenses) 1,781 286 48 340 (2,688) (233) EBITDA 77,575 28,968 46,152 95,307 (35,651) 212,351 Compensation and benefits (2) 1,034 1,501 1,004 2,114 8,145 13,798 Transaction, refinancing, and other fees (3) — 210 — — (163) 47 Adjusted EBITDA $ 78,609 $ 30,679 $ 47,156 $ 97,421 $ (27,669) $ 226,196 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment revenue eliminations predominantly reflect the $39.0 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software sale and developments of $6.7 million from Payment Services-Latin America to Payment Services-Puerto Rico & Caribbean. (2) Primarily represents share-based compensation, other compensation expense and severance payments. |
Reconciliation of Income from Operations to Consolidated Net Income | The reconciliation of EBITDA to consolidated net income is as follows: Years ended December 31, (In thousands) 2021 2020 2019 Total EBITDA $ 277,696 $ 218,943 $ 212,351 Less: Income tax expense 20,562 19,002 12,975 Interest expense, net 20,921 23,572 27,594 Depreciation and amortization 75,070 71,518 68,082 Net Income $ 161,143 $ 104,851 $ 103,700 |
Segment Information by Geographic Location | The geographic segment information below is classified based on the geographic location of the Company’s subsidiaries: Years ended December 31, (In thousands) 2021 2020 2019 Revenues (1) Puerto Rico $ 473,647 $ 418,151 $ 392,628 Caribbean 18,917 14,873 15,950 Latin America 97,232 77,564 78,796 Total Revenues $ 589,796 $ 510,588 $ 487,374 (1) Revenues are based on subsidiaries’ country of domicile. |
The Company and Summary of Si_3
The Company and Summary of Significant Accounting Policies (Details) | 12 Months Ended | ||
Dec. 31, 2021USD ($)country | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Company And Summary Of Significant Accounting Policies [Line Items] | |||
Number of countries where services are provided | country | 26 | ||
Interest cost capitalized | $ 800,000 | $ 700,000 | $ 1,100,000 |
Impairment losses | $ 0 | $ 0 | $ 0 |
Minimum | Software and Maintenance | |||
Company And Summary Of Significant Accounting Policies [Line Items] | |||
Intangible asset useful life | 1 year | ||
Maximum | Software and Maintenance | |||
Company And Summary Of Significant Accounting Policies [Line Items] | |||
Intangible asset useful life | 5 years | ||
Software Development | Minimum | |||
Company And Summary Of Significant Accounting Policies [Line Items] | |||
Intangible asset useful life | 3 years | ||
Software Development | Maximum | |||
Company And Summary Of Significant Accounting Policies [Line Items] | |||
Intangible asset useful life | 10 years |
Debt Securities (Detail)
Debt Securities (Detail) $ in Thousands | Dec. 31, 2021USD ($) |
Available-for-sale Securities, Debt Maturities [Abstract] | |
Amortized cost, after 1 to 5 years | $ 2,963 |
Gross unrealized gains, after 1 to 5 years | 78 |
Gross unrealized losses, after 1 to 5 years | 0 |
Fair Value, after 1 to 5 years | $ 3,041 |
Revenues - Additional Informati
Revenues - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 589,796 | $ 510,588 | $ 487,374 |
Accounts receivable, net | 113,285 | 95,727 | |
Contract liability | 17,398 | 24,958 | |
Contract liability - long term | 36,258 | 31,336 | |
Revenue recognized that was included in unearned income | 25,700 | 16,300 | |
Transaction price allocated to performance obligations that are unsatisfied or partially satisfied | 254,500 | ||
Payment Processing - LATAM | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 23,900 | $ 9,900 | $ 9,800 |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 589,796 | $ 510,588 | $ 487,374 |
Products and services transferred at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 11,095 | 11,064 | 17,273 |
Products and services transferred over time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 578,701 | 499,524 | 470,101 |
Payment Services - Puerto Rico & Caribbean | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 104,792 | 88,272 | 85,528 |
Payment Services - Puerto Rico & Caribbean | Products and services transferred at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 168 | 134 | 3,041 |
Payment Services - Puerto Rico & Caribbean | Products and services transferred over time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 104,624 | 88,138 | 82,487 |
Payment Services - Latin America | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 97,232 | 77,563 | 78,796 |
Payment Services - Latin America | Products and services transferred at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 2,045 | 1,448 | 3,811 |
Payment Services - Latin America | Products and services transferred over time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 95,187 | 76,115 | 74,985 |
Merchant Acquiring, net | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 143,965 | 109,788 | 106,388 |
Merchant Acquiring, net | Products and services transferred at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 0 | 0 | 0 |
Merchant Acquiring, net | Products and services transferred over time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 143,965 | 109,788 | 106,388 |
Business Solutions | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 243,807 | 234,965 | 216,662 |
Business Solutions | Products and services transferred at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 8,882 | 9,482 | 10,421 |
Business Solutions | Products and services transferred over time | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 234,925 | $ 225,483 | $ 206,241 |
Revenues - Contract Balances (D
Revenues - Contract Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue, Contract Balances [Roll Forward] | ||
Balance at beginning of period | $ 2,796 | $ 1,191 |
Services transferred to customers | 5,374 | 3,934 |
Transfers to accounts receivable | (6,455) | (2,329) |
Balance at end of period | $ 1,715 | $ 2,796 |
Revenues - Performance Obligati
Revenues - Performance Obligation (Details) - Professional Services, All Other Contracts - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | Dec. 31, 2021 |
Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period of expected timing of satisfaction | 2 years |
Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, period of expected timing of satisfaction | 5 years |
Cash and cash equivalents (Deta
Cash and cash equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Cash and Cash Equivalents [Line Items] | |||
Cash and cash equivalents | $ 266,351 | $ 202,649 | $ 111,030 |
Cash Deposited In an Affiliate Financial Institution | |||
Cash and Cash Equivalents [Line Items] | |||
Cash and cash equivalents | 173,900 | 116,000 | |
Territories Other Than Puerto Rico | |||
Cash and Cash Equivalents [Line Items] | |||
Cash and cash equivalents | $ 96,300 | $ 80,000 |
Accounts Receivable and Allow_3
Accounts Receivable and Allowance for Current Expected Credit Losses - Summary of Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Receivables [Abstract] | ||
Trade | $ 66,255 | $ 58,701 |
Due from affiliates, net | 38,120 | 28,419 |
Settlement assets | 11,417 | 10,641 |
Other | 16 | 367 |
Less: allowance for current expected credit losses | (2,523) | (2,401) |
Accounts receivable, net | $ 113,285 | $ 95,727 |
Accounts Receivable and Allow_4
Accounts Receivable and Allowance for Current Expected Credit Losses - Allowance for Credit Losses on Trade Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at the beginning of the period | $ 2,401 | $ 3,460 |
Current period provision for expected credit losses | 819 | 832 |
Write-offs | (698) | (1,894) |
Recoveries of amounts previously written-off | 1 | 3 |
Balance at the end of the period | $ 2,523 | $ 2,401 |
Prepaid Expenses and Other As_3
Prepaid Expenses and Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Prepaid Expenses And Other Current Assets [Line Items] | ||
Software maintenance contracts | $ 11,629 | $ 10,745 |
Deferred project costs | 4,927 | 11,614 |
Prepaid cloud computing arrangement fees | 4,453 | 2,145 |
Insurance | 2,286 | 2,335 |
Postage | 2,078 | 1,906 |
Contract assets | 1,677 | 2,661 |
Guarantee deposits | 850 | 2,648 |
Other | 2,763 | 2,013 |
Prepaid expenses and other assets | 37,148 | 42,214 |
Income taxes | ||
Prepaid Expenses And Other Current Assets [Line Items] | ||
Prepaid income taxes and Taxes other than on income | 4,080 | 3,757 |
Taxes other than income | ||
Prepaid Expenses And Other Current Assets [Line Items] | ||
Prepaid income taxes and Taxes other than on income | $ 2,405 | $ 2,390 |
Investment in Equity Investee (
Investment in Equity Investee (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2011 | |
Schedule of Equity Method Investments [Line Items] | ||||
Equity interest in CONTADO acquisition | 19.99% | |||
Equity interest in CONTADO, excess cost of investment over underlying equity in net assets | $ 9,000,000 | |||
Earnings of equity method investment | $ 1,713,000 | $ 1,136,000 | $ 936,000 | |
Dividends received from CONTADO | 1,200,000 | 0 | 500,000 | |
Equity Method Investments | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity interest in CONTADO, amortization expense | $ 200,000 | $ 200,000 | $ 300,000 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 153,713 | $ 136,123 |
Less—accumulated depreciation and amortization | (106,365) | (93,826) |
Depreciable assets, net | 47,348 | 42,297 |
Land | 1,185 | 1,241 |
Property and equipment, net | $ 48,533 | 43,538 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Useful life in years | 30 years | |
Property and equipment, gross | $ 1,359 | 1,437 |
Data processing equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 141,359 | 124,897 |
Data processing equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life in years | 3 years | |
Data processing equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life in years | 5 years | |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 7,718 | 6,691 |
Furniture and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life in years | 3 years | |
Furniture and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life in years | 20 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 3,277 | $ 3,098 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life in years | 5 years | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life in years | 10 years |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense | $ 17.4 | $ 17.4 | $ 16.6 |
Goodwill - Changes in Carrying
Goodwill - Changes in Carrying Amount of Goodwill Allocated by Reportable Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 397,670 | $ 399,487 |
Foreign currency translation adjustments | (4,352) | (1,817) |
Goodwill, ending balance | 393,318 | 397,670 |
Payment Services - Puerto Rico & Caribbean | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 160,972 | 160,972 |
Foreign currency translation adjustments | 0 | 0 |
Goodwill, ending balance | 160,972 | 160,972 |
Payment Services - Latin America | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 52,754 | 54,571 |
Foreign currency translation adjustments | (4,352) | (1,817) |
Goodwill, ending balance | 48,402 | 52,754 |
Merchant Acquiring, net | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 138,121 | 138,121 |
Foreign currency translation adjustments | 0 | 0 |
Goodwill, ending balance | 138,121 | 138,121 |
Business Solutions | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 45,823 | 45,823 |
Foreign currency translation adjustments | 0 | 0 |
Goodwill, ending balance | $ 45,823 | $ 45,823 |
Goodwill - Additional Informati
Goodwill - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill [Line Items] | |||
Impairment losses | $ 0 | $ 0 | $ 0 |
Other Intangible Assets, Net -
Other Intangible Assets, Net - Carrying Amount of Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $ 782,751 | $ 731,761 |
Accumulated amortization | (569,463) | (511,852) |
Net carrying amount | 213,288 | 219,909 |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | 357,991 | 343,981 |
Accumulated amortization | (272,732) | (246,088) |
Net carrying amount | $ 85,259 | $ 97,893 |
Customer relationships | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 8 years | 8 years |
Customer relationships | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 14 years | 14 years |
Trademark | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $ 41,901 | $ 42,036 |
Accumulated amortization | (36,684) | (35,467) |
Net carrying amount | $ 5,217 | $ 6,569 |
Trademark | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 2 years | 2 years |
Trademark | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 15 years | 15 years |
Software packages | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $ 326,320 | $ 289,205 |
Accumulated amortization | (217,643) | (191,662) |
Net carrying amount | $ 108,677 | $ 97,543 |
Software packages | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 3 years | 3 years |
Software packages | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 10 years | 10 years |
Non-compete agreement | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 15 years | 15 years |
Gross amount | $ 56,539 | $ 56,539 |
Accumulated amortization | (42,404) | (38,635) |
Net carrying amount | $ 14,135 | $ 17,904 |
Other Intangible Assets, Net _2
Other Intangible Assets, Net - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Other Intangible Assets | |||
Other Intangible Assets [Line Items] | |||
Amortization expense | $ 57.6 | $ 54.1 | $ 51.5 |
Software packages | |||
Other Intangible Assets [Line Items] | |||
Amortization expense | $ 26 | $ 21.7 | $ 18.3 |
Other Intangible Assets, Net _3
Other Intangible Assets, Net - Estimated Amortization Expenses (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2022 | $ 52,534 |
2023 | 47,157 |
2024 | 35,139 |
2025 | 12,074 |
2026 | $ 5,607 |
Other Long-Term Assets (Details
Other Long-Term Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Schedule of Other Long Term Assets [Line Items] | ||
Deferred debt-issuance costs | $ 700 | $ 1,000 |
Other long-term assets | 9,926 | 6,012 |
Deferred costs, long-term portion | 4,300 | |
Software and Maintenance | ||
Schedule of Other Long Term Assets [Line Items] | ||
Other long-term assets | $ 4,900 | 4,800 |
Contract Assets | ||
Schedule of Other Long Term Assets [Line Items] | ||
Other long-term assets | $ 100 |
Debt and Short-Term Borrowing_2
Debt and Short-Term Borrowings - Summary of Total Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | ||
Total debt | $ 465,293 | $ 496,734 |
Credit Facility | Term A due on November 27, 2023 | ||
Debt Instrument [Line Items] | ||
Credit facility | $ 170,875 | $ 188,788 |
Credit Facility | Term A due on November 27, 2023 | Fixed Rate | ||
Debt Instrument [Line Items] | ||
Margin interest rate | 1.75% | 1.75% |
Credit Facility | Term B due on November 27, 2024 | ||
Debt Instrument [Line Items] | ||
Credit facility | $ 293,660 | $ 306,503 |
Credit Facility | Term B due on November 27, 2024 | Fixed Rate | ||
Debt Instrument [Line Items] | ||
Margin interest rate | 3.50% | 3.50% |
Minimum variable rate | 0.00% | 0.00% |
Notes Payable | Note Payable due on January 1, 2022 | ||
Debt Instrument [Line Items] | ||
Note payable | $ 758 | $ 1,443 |
Debt and Short-Term Borrowing_3
Debt and Short-Term Borrowings - Summary of Contractual Principal Payments (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2022 | $ 19,750 |
2023 | 158,364 |
2024 | 289,344 |
Thereafter | $ 0 |
Debt and Short-Term Borrowing_4
Debt and Short-Term Borrowings - Additional Information (Details) | Mar. 08, 2021USD ($) | Mar. 05, 2020USD ($) | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2020USD ($) | Sep. 30, 2020 | Mar. 31, 2019 | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($)agreement | Dec. 31, 2018USD ($) | May 31, 2019 | Nov. 27, 2018USD ($) |
Debt Instrument [Line Items] | |||||||||||||
Repayments of lines of credit | $ 17,800,000 | $ 17,000,000 | |||||||||||
Reclassification from accumulated comprehensive loss over the next 12 months | $ 7,000,000 | ||||||||||||
Cash Flow Hedge | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Reclassification of (losses) gains to net income | (7,065,000) | $ (5,066,000) | $ 700,000 | ||||||||||
Interest Rate Swap Maturing April 2020 Agreement | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Notional amount | $ 200,000,000 | $ 200,000,000 | |||||||||||
Fixed rate | 1.9225% | 1.9225% | |||||||||||
Fair Value, Measurements, Recurring | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest rate swap | $ 25,578,000 | 13,392,000 | $ 25,578,000 | ||||||||||
Level 2 | Fair Value, Measurements, Recurring | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest rate swap | 25,578,000 | 13,392,000 | 25,578,000 | ||||||||||
2018 Credit Agreement | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Prepayment premium | 1.00% | ||||||||||||
Prepayment trigger, maximum value of excess cash flow times interest rate | $ 10,000,000 | ||||||||||||
Notes Payable | Non-Interest Bearing Financing Agreement Two | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Number of financing arrangements | agreement | 2 | ||||||||||||
Non interest bearing financing agreement amount | $ 2,400,000 | ||||||||||||
Note payable | $ 1,500,000 | 800,000 | $ 1,500,000 | ||||||||||
Term A due on November 27, 2023 | Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Leverage ratio | 4 | 4.25 | |||||||||||
Unpaid principal balance | $ 171,600,000 | ||||||||||||
Term A due on November 27, 2023 | Credit Facility | Fixed Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 1.75% | 1.75% | |||||||||||
Term A due on November 27, 2023 | Credit Facility | 2018 Credit Agreement | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Line of credit facility, maximum borrowing capacity | $ 220,000,000 | ||||||||||||
Quarterly amortization, rate | 1.25% | ||||||||||||
Term A due on November 27, 2023 | Credit Facility | 2018 Credit Agreement | Fixed Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 2.25% | ||||||||||||
Term A due on November 27, 2023 | Credit Facility | 2018 Credit Agreement | Federal Funds Effective Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 0.50% | ||||||||||||
Term A due on November 27, 2023 | Credit Facility | 2018 Credit Agreement | Base Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 1.00% | ||||||||||||
Term A due on November 27, 2023 | Credit Facility | 2018 Credit Agreement | ABR | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 1.25% | ||||||||||||
Term A due on November 27, 2023 | Credit Facility | 2018 Credit Agreement | Forecast | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Quarterly amortization, rate | 2.50% | 1.875% | |||||||||||
Term B due on November 27, 2024 | Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Unpaid principal balance | $ 295,800,000 | ||||||||||||
Term B due on November 27, 2024 | Credit Facility | Fixed Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 3.50% | 3.50% | |||||||||||
Term B due on November 27, 2024 | Credit Facility | 2018 Credit Agreement | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Line of credit facility, maximum borrowing capacity | 325,000,000 | ||||||||||||
Quarterly amortization, annualized rate | 1.00% | ||||||||||||
Term B due on November 27, 2024 | Credit Facility | 2018 Credit Agreement | Fixed Rate | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 3.50% | ||||||||||||
Term B due on November 27, 2024 | Credit Facility | 2018 Credit Agreement | ABR | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Margin interest rate | 2.50% | ||||||||||||
Senior Secured Revolving Credit Facility | Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Line of credit, remaining borrowing capacity | $ 119,100,000 | ||||||||||||
Senior Secured Revolving Credit Facility | Credit Facility | 2018 Credit Agreement | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Line of credit facility, maximum borrowing capacity | $ 125,000,000 |
Debt and Short-Term Borrowing_5
Debt and Short-Term Borrowings - Interest Rate Swaps (Details) - 2018 Interest Rate Swap Agreement | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Derivative [Line Items] | |
Notional Amount | $ 250,000,000 |
Fixed Rate | |
Derivative [Line Items] | |
Fixed Rate | 2.89% |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements - Fair Value Measurements for Assets and Liabilities at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Financial asset: | ||
Costa Rica Government Obligations | $ 3,041 | $ 0 |
Fair Value, Measurements, Recurring | ||
Financial liability: | ||
Interest rate swap | 13,392 | 25,578 |
Fair Value, Measurements, Recurring | Costa Rica Government Obligations | ||
Financial asset: | ||
Costa Rica Government Obligations | 3,041 | |
Fair Value, Measurements, Recurring | Level 1 | ||
Financial liability: | ||
Interest rate swap | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | Costa Rica Government Obligations | ||
Financial asset: | ||
Costa Rica Government Obligations | 0 | |
Fair Value, Measurements, Recurring | Level 2 | ||
Financial liability: | ||
Interest rate swap | 13,392 | 25,578 |
Fair Value, Measurements, Recurring | Level 2 | Costa Rica Government Obligations | ||
Financial asset: | ||
Costa Rica Government Obligations | 3,041 | |
Fair Value, Measurements, Recurring | Level 3 | ||
Financial liability: | ||
Interest rate swap | 0 | $ 0 |
Fair Value, Measurements, Recurring | Level 3 | Costa Rica Government Obligations | ||
Financial asset: | ||
Costa Rica Government Obligations | $ 0 |
Financial Instruments and Fai_4
Financial Instruments and Fair Value Measurements - Carrying Value and Estimated Fair Values for Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Financial asset: | ||
Costa Rica Government Obligations | $ 3,041 | $ 0 |
Carrying Amount | ||
Financial liability: | ||
Interest rate swap | 13,392 | 25,578 |
Carrying Amount | Credit Facility | 2023 Term A Loan | ||
Financial liability: | ||
Senior secured term loan | 170,875 | 188,788 |
Carrying Amount | Credit Facility | 2024 Term B Loan | ||
Financial liability: | ||
Senior secured term loan | 293,660 | 306,503 |
Fair Value | ||
Financial liability: | ||
Interest rate swap | 13,392 | 25,578 |
Fair Value | Credit Facility | 2023 Term A Loan | ||
Financial liability: | ||
Senior secured term loan | 168,610 | 186,678 |
Fair Value | Credit Facility | 2024 Term B Loan | ||
Financial liability: | ||
Senior secured term loan | 294,735 | 308,336 |
Costa Rica Government Obligations | Carrying Amount | ||
Financial asset: | ||
Costa Rica Government Obligations | 3,041 | 0 |
Costa Rica Government Obligations | Fair Value | ||
Financial asset: | ||
Costa Rica Government Obligations | $ 3,041 | $ 0 |
Financial Instruments and Fai_5
Financial Instruments and Fair Value Measurements - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |||
Transfer in or out of Level 3 assets | $ 0 | $ 0 | $ 0 |
Other Long-Term Liabilities (De
Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Other Long Term Liabilities [Line Items] | ||||
Unrecognized tax benefits | $ 3,951 | $ 5,908 | $ 9,146 | $ 9,238 |
Other Noncurrent Liabilities | ||||
Other Long Term Liabilities [Line Items] | ||||
Unrecognized tax benefits | 5,600 | 8,700 | ||
Long-term notes payable | $ 2,700 | $ 5,300 |
Equity - Additional Information
Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Equity [Abstract] | |||
Common stock, authorized (in shares) | 206,000,000 | 206,000,000 | |
Common stock, par value (in dollars per share) | $ 0.01 | ||
Common stock, outstanding (in shares) | 71,969,856 | 72,137,678 | |
Preferred stock, authorized (in shares) | 2,000,000 | 2,000,000 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Preferred stock, issued (in shares) | 0 | 0 | |
Shares repurchased (in shares) | 600,000 | 300,000 | 1,100,000 |
Repurchase of common stock | $ 24,388 | $ 7,300 | $ 31,822 |
Equity - Summary of Dividend Ac
Equity - Summary of Dividend Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
First Quarter Dividend | ||
Dividends Payable [Line Items] | ||
Declaration Date | Feb. 18, 2021 | Feb. 20, 2020 |
Record Date | Mar. 1, 2021 | Mar. 4, 2020 |
Payment Date | Mar. 26, 2021 | Apr. 3, 2020 |
Dividend per share (in dollars per share) | $ 0.05 | $ 0.05 |
Second Quarter Dividend | ||
Dividends Payable [Line Items] | ||
Declaration Date | Apr. 22, 2021 | Apr. 21, 2020 |
Record Date | May 3, 2021 | May 4, 2020 |
Payment Date | Jun. 4, 2021 | Jun. 5, 2020 |
Dividend per share (in dollars per share) | $ 0.05 | $ 0.05 |
Third Quarter Dividend | ||
Dividends Payable [Line Items] | ||
Declaration Date | Jul. 22, 2021 | Jul. 24, 2020 |
Record Date | Aug. 2, 2021 | Aug. 3, 2020 |
Payment Date | Sep. 3, 2021 | Sep. 4, 2020 |
Dividend per share (in dollars per share) | $ 0.05 | $ 0.05 |
Fourth Quarter Dividend | ||
Dividends Payable [Line Items] | ||
Declaration Date | Oct. 21, 2021 | Oct. 20, 2020 |
Record Date | Nov. 1, 2021 | Nov. 2, 2020 |
Payment Date | Dec. 3, 2021 | Dec. 4, 2020 |
Dividend per share (in dollars per share) | $ 0.05 | $ 0.05 |
Equity - Summary of Changes in
Equity - Summary of Changes in Balances Comprising Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | $ 342,429 | $ 271,623 | $ 215,606 |
Ending balance | 470,268 | 342,429 | 271,623 |
Foreign Currency Translation Adjustments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (24,842) | (16,872) | |
Other comprehensive loss before reclassifications | (11,129) | (7,970) | |
Effective portion reclassified to net income | 0 | 0 | |
Ending balance | (35,971) | (24,842) | (16,872) |
Cash Flow Hedge | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (23,412) | (13,137) | |
Other comprehensive loss before reclassifications | 4,086 | (15,341) | |
Effective portion reclassified to net income | 7,065 | 5,066 | (700) |
Ending balance | (12,261) | (23,412) | (13,137) |
Unrealized Gains on Debt Securities AFS | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | 0 | 0 | |
Other comprehensive loss before reclassifications | 109 | 0 | |
Effective portion reclassified to net income | 0 | 0 | |
Ending balance | 109 | 0 | 0 |
Total | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | |||
Beginning balance | (48,254) | (30,009) | (23,789) |
Other comprehensive loss before reclassifications | (6,934) | (23,311) | |
Effective portion reclassified to net income | 7,065 | 5,066 | |
Ending balance | $ (48,123) | $ (48,254) | $ (30,009) |
Share-based Compensation - Addi
Share-based Compensation - Additional Information (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Time Based Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Restricted Stock Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Maximum unrecognized cost for stock options | $ 19.1 |
Unrecognized compensation cost, weighted average period of recognition | 1 year 8 months 12 days |
Performance Shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Performance adjustment percent | 25.00% |
Performance measurement period | 1 year |
Requisite service period | 2 years |
Share-based Compensation - Nonv
Share-based Compensation - Nonvested Restricted Shares and RSUs Activity (Details) - Restricted shares and RSUs - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Shares | |||
Beginning balance (in shares) | 1,093,515 | 1,592,755 | 2,036,163 |
Granted (in shares) | 705,970 | 413,733 | 517,153 |
Vested (in shares) | (683,706) | (762,194) | (931,389) |
Forfeited (in shares) | (29,450) | (150,779) | (29,172) |
Ending balance (in shares) | 1,086,329 | 1,093,515 | 1,592,755 |
Weighted average grant date fair value | |||
Beginning balance (in dollar per share) | $ 27.88 | $ 20.71 | $ 15.09 |
Granted (in dollar per share) | 31.93 | 31.62 | 30.84 |
Vested (in dollar per share) | 20.95 | 16.65 | 29.32 |
Forfeited (in dollar per share) | 33.36 | 19.22 | 16.52 |
Ending balance (in dollar per share) | $ 34.73 | $ 27.88 | $ 20.71 |
Share-based Compensation - Shar
Share-based Compensation - Share-based Compensation Recognized (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Restricted shares and RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation recognized, net | $ 14,799 | $ 14,253 | $ 13,570 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |||
Defined contribution saving plan, vesting period | 5 years | ||
Defined contribution saving plan cost | $ 1 | $ 0.9 | $ 0.8 |
Total Other Income (Expenses) (
Total Other Income (Expenses) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Other Income and Expenses [Abstract] | |||
Other income (expenses), foreign currency transaction gain | $ 3.3 | $ 4.4 | $ 1.7 |
Gain on sale of assets, Ticketpop business | $ 0.8 |
Income Tax - Components of Inco
Income Tax - Components of Income Tax (Benefit) Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Current tax provision | $ 23,388 | $ 22,907 | $ 19,366 |
Deferred tax benefit | (2,826) | (3,905) | (6,391) |
Income tax expense | $ 20,562 | $ 19,002 | $ 12,975 |
Income Tax - Segregation of Inc
Income Tax - Segregation of Income Tax Expense (Benefit) Based on Location of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income before income tax provision | |||
Income before income tax provision | $ 181,705 | $ 123,853 | $ 116,675 |
Current tax provision | |||
Total current tax provision | 23,388 | 22,907 | 19,366 |
Deferred tax (benefit) provision | |||
Total deferred tax benefit | (2,826) | (3,905) | (6,391) |
Puerto Rico | |||
Income before income tax provision | |||
Income before income tax provision | 148,331 | 98,608 | 89,667 |
Current tax provision | |||
Puerto Rico | 6,792 | 7,260 | 7,550 |
Deferred tax (benefit) provision | |||
Puerto Rico | (2,428) | (2,087) | (4,109) |
United States | |||
Income before income tax provision | |||
Income before income tax provision | 622 | 3,953 | 4,047 |
Current tax provision | |||
United States | 137 | 612 | 339 |
Deferred tax (benefit) provision | |||
United States | 109 | 1,041 | (216) |
Foreign countries | |||
Income before income tax provision | |||
Income before income tax provision | 32,752 | 21,292 | 22,961 |
Current tax provision | |||
Foreign countries | 16,459 | 15,035 | 11,477 |
Deferred tax (benefit) provision | |||
Foreign countries | $ (507) | $ (2,859) | $ (2,066) |
Income Tax - Additional Informa
Income Tax - Additional Information (Details) $ in Thousands | Dec. 01, 2013 | Oct. 19, 2012USD ($)employee | Oct. 11, 2011 | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Income Tax Examination [Line Items] | |||||||
Unremitted earnings for foreign subsidiaries | $ 99,100 | $ 80,200 | |||||
Preferential tax rate | 4.00% | 4.00% | 7.00% | 4.00% | |||
Commitments to maintain tax exemption grant, minimum number of employees to be maintained, second period | employee | 700 | ||||||
Commitments to maintain tax exemption grant, investments | $ 200,000 | ||||||
Commitments to maintain tax exemption grant, investment increment over four year cycle | $ 50,000 | ||||||
Deferred tax assets, net | $ 5,900 | 3,900 | |||||
Deferred tax asset, valuation allowance | 1,400 | 900 | |||||
Deferred tax asset, net | 4,541 | 2,982 | |||||
Unrecognized tax benefits | 3,951 | 5,908 | $ 9,146 | $ 9,238 | |||
Unrecognized tax expense | 400 | 300 | $ 400 | ||||
Interest and penalties accrued | 1,600 | $ 2,600 | |||||
Puerto Rico | |||||||
Income Tax Examination [Line Items] | |||||||
Commitments to maintain tax exemption grant, percentage of resident employees | 80.00% | ||||||
NOL carryforwards available to offset future taxable income | 6,800 | ||||||
Possible decrease in uncertain tax positions | 3,600 | ||||||
United States | |||||||
Income Tax Examination [Line Items] | |||||||
NOL carryforwards available to offset future taxable income | 600 | ||||||
Foreign countries | |||||||
Income Tax Examination [Line Items] | |||||||
NOL carryforwards available to offset future taxable income | $ 4,000 | ||||||
Income Tax | |||||||
Income Tax Examination [Line Items] | |||||||
Tax exemption period | 15 years |
Income Tax - Components of Defe
Income Tax - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets (“DTA”) | ||
Allowance for doubtful accounts | $ 175 | $ 223 |
Unearned income | 10,475 | 11,058 |
Lease liability | 2,655 | 3,410 |
Share-based compensation | 1,181 | 1,163 |
Debt issuance costs | 132 | 189 |
Accrued liabilities | 3,263 | 1,828 |
Derivative liability | 1,036 | 2,070 |
Accrual of contract maintenance cost | 84 | 110 |
Impairment of asset | 290 | 310 |
Other | 1,596 | 1,649 |
Total gross deferred tax assets | 20,887 | 22,010 |
Deferred tax liabilities (“DTL”) | ||
Capitalized salaries | 2,193 | 2,095 |
Difference between the assigned values and the tax basis of assets and liabilities recognized in business combinations | 7,978 | 10,507 |
Right of use asset | 2,707 | 3,340 |
Other | 3,468 | 3,086 |
Total gross deferred tax liabilities | 16,346 | 19,028 |
Deferred tax asset (liability), net | $ 4,541 | $ 2,982 |
Income Tax - Operating Loss Car
Income Tax - Operating Loss Carryforwards (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Income Tax Disclosure [Abstract] | |
2026 | $ 51 |
2028 | 688 |
2029 | 1,558 |
2030 | 4,112 |
2031 | 3,737 |
2033 | 178 |
Indefinitely | $ 1,072 |
Income Tax - Reconciliation of
Income Tax - Reconciliation of Total Amounts of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance, beginning of year | $ 5,908 | $ 9,146 | $ 9,238 |
Gross increases—tax positions in prior period | 431 | 1,335 | 0 |
Gross decreases—tax positions in prior period | (101) | (192) | (92) |
Lapse of statute of limitations | (2,287) | (4,381) | 0 |
Balance, end of year | $ 3,951 | $ 5,908 | $ 9,146 |
Income Tax - Income Tax Expense
Income Tax - Income Tax Expense Differs from Computed Income Tax at Statutory Rates (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Statutory income tax rate | 37.50% | ||
Computed income tax at statutory rates | $ 68,139 | $ 46,445 | $ 43,753 |
Differences in tax rates due to multiple jurisdictions | 2,003 | 839 | 1,058 |
Excess tax benefits on share-based compensation | (1,023) | (1,094) | (1,779) |
Effect of income subject to tax-exemption grant | (46,762) | (31,347) | (31,424) |
Unrecognized tax (benefit) expense | (3,388) | 1,322 | (32) |
Other, net | 1,593 | 2,837 | 1,399 |
Income tax expense | $ 20,562 | $ 19,002 | $ 12,975 |
Net Income Per Common Share (De
Net Income Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |||
Net income attributable to EVERTEC, Inc.’s common stockholders | $ 161,130 | $ 104,436 | $ 103,469 |
Less: non-forfeitable dividends on restricted stock | 0 | 0 | 3 |
Net income available to EVERTEC, Inc.'s common shareholders | $ 161,130 | $ 104,436 | $ 103,466 |
Weighted average common shares outstanding (in shares) | 72,053,795 | 71,943,965 | 72,099,755 |
Weighted average potential dilutive common shares (in shares) | 816,790 | 1,107,240 | 1,376,008 |
Weighted average common shares outstanding-assuming dilution (in shares) | 72,870,585 | 73,051,205 | 73,475,763 |
Net income per common share - basic (in dollar per share) | $ 2.24 | $ 1.45 | $ 1.44 |
Net income per common share - diluted (in dollar per share) | $ 2.21 | $ 1.43 | $ 1.41 |
Related Party Transactions - Tr
Related Party Transactions - Transactions with Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||
Total revenues | $ 245,613 | $ 226,074 | $ 209,053 |
Cost of revenues | 2,610 | 4,317 | 5,094 |
Rent and other fees | 7,487 | 8,320 | 8,519 |
Interest earned from an affiliate | |||
Interest income | 647 | 391 | 161 |
Earnings of equity method investment | 1,713 | 1,136 | 936 |
Popular | |||
Interest earned from an affiliate | |||
Earnings of equity method investment | $ 300 | $ 600 | $ 1,100 |
Popular | Customer Concentration Risk | Total Revenue | |||
Interest earned from an affiliate | |||
Total percentage of revenues from Popular | 42.00% | 44.00% | 43.00% |
Related Party Transactions - Su
Related Party Transactions - Summary of Balances of Transactions with Related Parties (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Related Party Transactions [Abstract] | ||
Cash and restricted cash deposits in affiliated bank | $ 187,602 | $ 126,189 |
Other due/to from affiliate | ||
Accounts receivable | 38,120 | 28,419 |
Prepaid expenses and other assets | 1,763 | 4,678 |
Operating lease right-of use assets | 13,533 | 17,099 |
Other long-term assets | 2,853 | 0 |
Accounts payable | 5,601 | 4,607 |
Unearned income | 40,982 | 35,807 |
Operating lease liabilities | $ 14,019 | $ 17,781 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Popular | |
Related Party Transaction [Line Items] | |
Service contract period | 15 years |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - Office Facilities, Buildings, Telecommunications, And Other Equipment | 12 Months Ended |
Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | |
Lease renewal term | 5 years |
Termination period | 1 year |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease term | 8 years |
Commitments and Contingencies_2
Commitments and Contingencies - Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Lease, Cost [Abstract] | ||
Operating lease cost | $ 6,948 | $ 7,025 |
Variable lease cost | 2,472 | 3,182 |
Total lease costs | 9,420 | 10,207 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 178 | $ 3,496 |
Weighted average remaining lease term, in years | 4 years | 5 years |
Weighted Average Discount Rate | 2.30% | 2.80% |
Commitments and Contingencies_3
Commitments and Contingencies - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Current portion of operating lease liability | $ 5,580 | $ 5,830 |
Operating lease liability - long-term | 16,456 | 22,402 |
Total operating lease liabilities | 22,036 | 28,232 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2022 | 6,387 | |
2023 | 6,036 | |
2024 | 5,123 | |
2025 | 4,072 | |
2026 | 871 | |
Thereafter | 1,617 | |
Total future minimum lease payments | 24,106 | |
Less: imputed interest | (2,070) | |
Total | $ 22,036 | $ 28,232 |
Segment Information - Additiona
Segment Information - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of operating business segments | segment | 4 | ||
Revenues | $ 589,796 | $ 510,588 | $ 487,374 |
Major Customer | Total Revenue | |||
Segment Reporting Information [Line Items] | |||
Revenues | $ 245,300 | $ 225,500 | $ 208,000 |
Major Customer | Total Revenue | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage of total revenue from major customer | 42.00% | 44.00% | 43.00% |
Puerto Rico | Total Revenue | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage of total revenue from major customer | 6.00% | 8.00% | 7.00% |
Segment Information - Informati
Segment Information - Information about Operations by Business Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2011 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 589,796 | $ 510,588 | $ 487,374 | |
Operating costs and expenses | 393,282 | 369,196 | 342,872 | |
Depreciation and amortization | 75,070 | 71,518 | 68,082 | |
Non-operating income (expenses) | 6,112 | 6,033 | (233) | |
EBITDA | 277,696 | 218,943 | 212,351 | |
Compensation and benefits | 15,144 | 14,383 | 13,798 | |
Transaction, refinancing, exit activity and other fees | 1,978 | 7,141 | 47 | |
Adjusted EBITDA | $ 294,818 | $ 240,467 | $ 226,196 | |
Equity interest in CONTADO acquisition | 19.99% | |||
Consorcio de Tarjetas Dominicanas S.A. | ||||
Segment Reporting Information [Line Items] | ||||
Equity interest in CONTADO acquisition | 19.99% | 19.99% | 19.99% | |
Merchant Acquiring, net | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 143,965 | $ 109,788 | $ 106,388 | |
Business Solutions | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 243,807 | 234,965 | 216,662 | |
Operating Segments | Payment Services - Puerto Rico & Caribbean | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 155,392 | 124,771 | 125,544 | |
Operating costs and expenses | 84,742 | 72,968 | 61,396 | |
Depreciation and amortization | 16,085 | 13,455 | 11,646 | |
Non-operating income (expenses) | 842 | 202 | 1,781 | |
EBITDA | 87,577 | 65,460 | 77,575 | |
Compensation and benefits | 1,702 | 987 | 1,034 | |
Transaction, refinancing, exit activity and other fees | 660 | 500 | 0 | |
Adjusted EBITDA | 89,939 | 66,947 | 78,609 | |
Operating Segments | Payment Services - Latin America | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 105,963 | 84,641 | 84,453 | |
Operating costs and expenses | 86,152 | 73,030 | 65,701 | |
Depreciation and amortization | 11,395 | 11,299 | 9,930 | |
Non-operating income (expenses) | 8,216 | 6,934 | 286 | |
EBITDA | 39,422 | 29,844 | 28,968 | |
Compensation and benefits | 3,080 | 2,934 | 1,501 | |
Transaction, refinancing, exit activity and other fees | 0 | 0 | 210 | |
Adjusted EBITDA | 42,502 | 32,778 | 30,679 | |
Operating Segments | Merchant Acquiring, net | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 143,965 | 109,788 | 106,388 | |
Operating costs and expenses | 75,795 | 58,163 | 62,098 | |
Depreciation and amortization | 3,583 | 1,905 | 1,814 | |
Non-operating income (expenses) | 1,107 | 650 | 48 | |
EBITDA | 72,860 | 54,180 | 46,152 | |
Compensation and benefits | 1,012 | 926 | 1,004 | |
Transaction, refinancing, exit activity and other fees | 0 | 0 | 0 | |
Adjusted EBITDA | 73,872 | 55,106 | 47,156 | |
Operating Segments | Business Solutions | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 243,807 | 234,965 | 216,662 | |
Operating costs and expenses | 150,433 | 141,446 | 138,224 | |
Depreciation and amortization | 18,930 | 17,551 | 16,529 | |
Non-operating income (expenses) | 3,056 | 1,938 | 340 | |
EBITDA | 115,360 | 113,008 | 95,307 | |
Compensation and benefits | 1,775 | 1,794 | 2,114 | |
Transaction, refinancing, exit activity and other fees | (647) | 0 | 0 | |
Adjusted EBITDA | 116,488 | 114,802 | 97,421 | |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (59,331) | (43,577) | (45,673) | |
Operating costs and expenses | (3,840) | 23,589 | 15,453 | |
Depreciation and amortization | 25,077 | 27,308 | 28,163 | |
Non-operating income (expenses) | (7,109) | (3,691) | (2,688) | |
EBITDA | (37,523) | (43,549) | (35,651) | |
Compensation and benefits | 7,575 | 7,742 | 8,145 | |
Transaction, refinancing, exit activity and other fees | 1,965 | 6,641 | (163) | |
Adjusted EBITDA | (27,983) | (29,166) | (27,669) | |
Corporate and Other | Processing Fee | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 42,400 | 34,600 | 39,000 | |
Corporate and Other | Software Sale and Developments | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 9,200 | $ 9,000 | $ 6,700 | |
Corporate and Other | Transaction Processing and Monitoring Fees | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 7,600 |
Segment Information - Reconcili
Segment Information - Reconciliation of EBITDA to Net Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Reporting [Abstract] | |||
EBITDA | $ 277,696 | $ 218,943 | $ 212,351 |
Less: | |||
Income tax expense | 20,562 | 19,002 | 12,975 |
Interest expense, net | 20,921 | 23,572 | 27,594 |
Depreciation and amortization | 75,070 | 71,518 | 68,082 |
Net income | $ 161,143 | $ 104,851 | $ 103,700 |
Segment Information - Segment I
Segment Information - Segment Information by Geographic Location (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | $ 589,796 | $ 510,588 | $ 487,374 |
Puerto Rico | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | 473,647 | 418,151 | 392,628 |
Caribbean | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | 18,917 | 14,873 | 15,950 |
Latin America | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenues | $ 97,232 | $ 77,564 | $ 78,796 |
Subsequent Events (Details)
Subsequent Events (Details) $ / shares in Units, $ in Millions, $ in Millions | Feb. 15, 2022$ / shares | Jun. 30, 2022USD ($) | Sep. 30, 2022USD ($) | Sep. 30, 2022CLP ($) | Dec. 31, 2021$ / shares | Dec. 31, 2020$ / shares | Dec. 31, 2019$ / shares |
Subsequent Event [Line Items] | |||||||
Cash dividends declared per share (in dollar per share) | $ 0.20 | $ 0.20 | $ 0.20 | ||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Cash dividends declared per share (in dollar per share) | $ 0.05 | ||||||
Subsequent Event | Forecast | Banco Popular de Puerto Rico Acquisition | Popular | |||||||
Subsequent Event [Line Items] | |||||||
Asset acquisition, equity consideration transferred, amount | $ | $ 197 | ||||||
Subsequent Event | BBR SpA | Forecast | |||||||
Subsequent Event [Line Items] | |||||||
Percentage of shares acquired | 100.00% | 100.00% | |||||
Aggregate purchase price | $ 60 | $ 48,600 |
Condensed Financial Statement_2
Condensed Financial Statements Parent Company Only - Condensed Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Current Assets: | |||
Cash and cash equivalents | $ 266,351 | $ 202,649 | $ 111,030 |
Prepaid expenses and other assets | 37,148 | 42,214 | |
Total current assets | 436,350 | 359,046 | |
Investment in subsidiaries, at equity | 12,054 | 12,835 | |
Deferred tax asset | 6,910 | 5,730 | |
Total assets | 1,144,756 | 1,072,579 | |
Current Liabilities: | |||
Accrued liabilities | 74,540 | 58,033 | |
Accounts payable | 28,484 | 43,348 | |
Income tax payable | 7,132 | 6,573 | |
Total current liabilities | 152,884 | 152,992 | |
Other long-term liabilities | 8,344 | 14,053 | |
Total liabilities | 674,488 | 730,150 | |
Stockholders’ equity: | |||
Common stock | 719 | 721 | |
Additional paid-in capital | 7,565 | 5,340 | |
Accumulated earnings | 506,051 | 379,934 | |
Accumulated other comprehensive loss, net of tax | (48,123) | (48,254) | |
Total EVERTEC, Inc. stockholders’ equity | 466,212 | 337,741 | |
Total liabilities and equity | 1,144,756 | 1,072,579 | |
EVERTEC | |||
Current Assets: | |||
Cash and cash equivalents | 1,680 | 1,680 | |
Prepaid expenses and other assets | 0 | 470 | |
Total current assets | 1,680 | 2,150 | |
Investment in subsidiaries, at equity | 468,651 | 342,385 | |
Deferred tax asset | 4,062 | 2,786 | |
Total assets | 474,393 | 347,321 | |
Current Liabilities: | |||
Accrued liabilities | 1,259 | 272 | |
Accounts payable | 1,448 | 2,777 | |
Income tax payable | 1,834 | 0 | |
Total current liabilities | 4,541 | 3,049 | |
Other long-term liabilities | 3,640 | 6,530 | |
Total liabilities | 8,181 | 9,579 | |
Stockholders’ equity: | |||
Common stock | 719 | 721 | |
Additional paid-in capital | 7,565 | 5,339 | |
Accumulated earnings | 506,051 | 379,937 | |
Accumulated other comprehensive loss, net of tax | (48,123) | (48,255) | |
Total EVERTEC, Inc. stockholders’ equity | 466,212 | 337,742 | |
Total liabilities and equity | $ 474,393 | $ 347,321 |
Condensed Financial Statement_3
Condensed Financial Statements Parent Company Only - Condensed Statements of Income and Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Non-operating income (expenses) | |||
Equity in earnings of subsidiaries | $ 1,713 | $ 1,136 | $ 936 |
Interest income | 1,889 | 1,502 | 1,217 |
Other income (expenses) | 4,399 | 4,897 | (1,169) |
Income before income taxes | 181,705 | 123,853 | 116,675 |
Income tax benefit | 20,562 | 19,002 | 12,975 |
Net income attributable to EVERTEC, Inc.’s common stockholders | 161,130 | 104,436 | 103,469 |
Other comprehensive income (loss), net of tax | |||
Foreign currency translation adjustments | (11,129) | (7,970) | 4,754 |
Loss on cash flow hedges | 11,151 | (10,275) | (10,974) |
Unrealized gain on change in fair value of debt securities available-for-sale | 109 | 0 | 0 |
Total comprehensive income attributable to EVERTEC, Inc.’s common stockholders | 161,261 | 86,191 | 97,249 |
EVERTEC | |||
Non-operating income (expenses) | |||
Equity in earnings of subsidiaries | 157,787 | 103,308 | 101,078 |
Interest income | 157 | 234 | 367 |
Other income (expenses) | (2,563) | (1,594) | (1,595) |
Income before income taxes | 155,381 | 101,948 | 99,850 |
Income tax benefit | (5,749) | (2,489) | (3,619) |
Net income attributable to EVERTEC, Inc.’s common stockholders | 161,130 | 104,437 | 103,469 |
Other comprehensive income (loss), net of tax | |||
Foreign currency translation adjustments | (11,129) | (7,970) | 4,754 |
Loss on cash flow hedges | 11,151 | (10,275) | (10,974) |
Unrealized gain on change in fair value of debt securities available-for-sale | 109 | 0 | 0 |
Total comprehensive income attributable to EVERTEC, Inc.’s common stockholders | $ 161,261 | $ 86,192 | $ 97,249 |
Condensed Financial Statement_4
Condensed Financial Statements Parent Company Only - Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | |||
Cash flows from operating activities | $ 228,420 | $ 199,089 | $ 179,949 |
Cash flows from financing activities | |||
Dividends paid | (14,409) | (14,382) | (14,420) |
Repurchase of common stock | (24,388) | (7,300) | (31,822) |
Withholding taxes paid on share-based compensation | (8,793) | (8,134) | (8,849) |
Net cash used in financing activities | (81,285) | (62,617) | (70,227) |
Net increase in cash, cash equivalents and restricted cash | 64,812 | 89,984 | 44,375 |
Cash, cash equivalents and restricted cash at beginning of the period | 221,105 | 131,121 | 86,746 |
Cash, cash equivalents and restricted cash at end of the period | 285,917 | 221,105 | 131,121 |
EVERTEC | |||
Condensed Financial Statements, Captions [Line Items] | |||
Cash flows from operating activities | 47,590 | 29,817 | 55,092 |
Cash flows from financing activities | |||
Dividends paid | (14,409) | (14,382) | (14,420) |
Repurchase of common stock | (24,388) | (7,300) | (31,822) |
Withholding taxes paid on share-based compensation | (8,793) | (8,134) | (8,849) |
Net cash used in financing activities | (47,590) | (29,816) | (55,091) |
Net increase in cash, cash equivalents and restricted cash | 0 | 1 | 1 |
Cash, cash equivalents and restricted cash at beginning of the period | 1,680 | 1,679 | 1,678 |
Cash, cash equivalents and restricted cash at end of the period | $ 1,680 | $ 1,680 | $ 1,679 |