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Dec 31, 2022
CPI Card Group Q4 2022 Earnings Report
CPI Card Group's Q4 2022 results were reported, showcasing strong sales and profitability growth.
Key Takeaways
CPI Card Group reported a strong fourth quarter with a 36% increase in net sales to $126 million and a 1,754% increase in net income to $12.5 million. The company's performance was driven by strong customer demand for contactless cards and SaaS-based instant issuance solutions.
Net sales increased by 36% year-over-year to $126.4 million.
Net income increased 1,754% to $12.5 million, or $1.06 diluted earnings per share.
Adjusted EBITDA increased 100% to $27.2 million.
Gross profit margin was 37.6%, compared to 33.2% in the prior year fourth quarter.
CPI Card Group
CPI Card Group
CPI Card Group Revenue by Segment
Revenue by Segment
Debit & Credit Revenue
CapyFin.comPrepaid Debit Revenue
CapyFin.com Forward Guidance
The Company’s initial outlook for 2023 projects mid-single digit net sales growth, with higher growth for the Debit and Credit segment, which represented 82% of 2022 net sales, partially offset by expectations for Prepaid Debit segment sales to be similar to 2022 levels. The Company expects mid-to-high single digit Adjusted EBITDA growth for 2023, Free Cash Flow to more than double, and year-end Net Leverage Ratio improvement to between 2.5x and 3.0x.
Positive Outlook
- The Company expects to continue to gain market share overall.
- The Company projects mid-single digit net sales growth.
- Higher growth for the Debit and Credit segment.
- Company expects mid-to-high single digit Adjusted EBITDA growth for 2023
- Free Cash Flow to more than double
Challenges Ahead
- Anticipates market growth will not be as strong as 2022.
- Expectations for Prepaid Debit segment sales to be similar to 2022 levels.
- Chief Financial Officer Amintore Schenkel has informed the Company that he will be resigning from his position in 2023 due to family-related personal reasons.
- A deterioration in general economic conditions, including rising inflation and resulting in reduced consumer confidence and business spending, and a decline in consumer credit worthiness impacting demand for our products
- A disruption or other failure in our supply chain, including as a result of the Russia-Ukraine conflict and with respect to single source suppliers
Revenue & Expenses
Visualization of income flow from segment revenue to net income