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March 31, 2022

GreenBox POS Reports Fourth Quarter and Full Year 2021 Financial Results

GreenBox POS (NASDAQ: GBOX) ("GreenBox", the "Company"), an emerging and rapidly growing FinTech company has provided its financial results for the fourth quarter and full year ended December 31, 2021.

Fourth Quarter 2021 and Subsequent Operational Highlights:

Achieved a company record revenue in 2021 of $26.3 million, an increase of $17.8 million or 208.6% from $8.5 million in 2020. 2021 processing volume increased nearly tenfold to approximately $2.0 billion, from $202 million in 2020. Entered into key licensing partnership with Cross River, a respected technology driven infrastructure provider, to initiate banking as a service offering and substantially expand the universe of potential customers while creating new channels for revenue growth. Launched a new ACH bulk processing channel with client commitments surpassing $50 million per month. Strengthened senior management team by appointing respected world-class marketer Jacqueline Reynolds as Chief Marketing Officer. Launched a transformative global initiative to raise GreenBox brand awareness and appointed award-winning international agency INNOCEAN as advertising and branding agency of record. Fortified the company's balance sheet and obtained necessary growth capital with the issuance of a $100 million convertible debt financing. Accelerated the Company's share repurchase program with an additional $10 million being approved for repurchase. Appointed Min Wei, an accomplished operations executive with extensive experience in managing global technology company processes as Chief Operating Officer.

Management Commentary

"2021 was highlighted by the rapid expansion of our payment processing footprint and a record approximately $2.0 billion in processing volume," said Fredi Nisan, Chief Executive Officer of GreenBox POS. "This represents growth of nearly 10x over 2020, a milestone achievement that demonstrates the scalability of our technology, our market share growth, our ability to remain compliant, and the quality of our sales team and overall ecosystem for our growing client roster. This KPI translated into record company revenue during 2021 of $26.3 million, representing tremendous growth of over 209% when compared to 2020's full year revenue.

"During the year we were highly focused on closing and integrating our strategic acquisitions of Northeast Merchant Services and ChargeSavvy. As an indication of the success of their integration, just six months after closing, ChargeSavvy achieved its best quarter in its 9-year history as a result of improved technology and efficiencies. We also announced the planned acquisition of Transact Europe Holdings (TEU). Once complete, the acquisition of TEU positions us for rapid global expansion and creates a tremendous opportunity to deploy coyni at scale. We will continue to explore strategic acquisitions that will allow us to add portfolios of processing volume, increase key licensing assets domestically and globally, grow the adoption of coyniand enable us to branch out and service more verticals and geographic locations.

"Operationally, during the fourth quarter and into 2021 we continued to strengthen the composition of our management team. We welcomed Min Wei as our new Chief Operating Officer whose background in operational efficiencies at global technology companies will be critical for us given our expansion plans. Jacqueline Reynolds, our new Chief Marketing Officer, is utilizing her decades of experience leading some of the world's most coveted brands and spearheading our recently announced transformational global initiative to raise GreenBox brand awareness with the appointment award-winning advertising agency, INNOCEAN as our advertising and branding agency of record.

"Looking forward, we remain highly focused on the pursuit of our objectives to build compliant, cutting edge blockchain ledger tokenized payment solutions for the diverse, evolving and dynamic global market. Considering our global expansion plans and potential acquisitions, we expect to increase our processing volume in 2022 to between $4-$5 billion.

"I would like to thank our stakeholders for their ongoing support. We recently demonstrated our commitment to our shareholders and confidence in our ability to execute on the growth opportunities in front of us with the approval of an accelerated share repurchase program of up to $10 million. Taken together, we believe we have the technology, resources, and partnerships in place to continue to drive the future of financial technology while creating long-term sustainable value for our shareholders, "concluded Nisan.

Fourth Quarter and Full Year 2021 Financial Results

  • 2021 revenues increased by $17.8 million or 208.6%, to $26.3 million from $8.5 million for the year 2020. The increase was primarily due to an increase in processing volume from $202 million for 2020 to $1.95 billion for 2021. The increase in processing volume was due to a number of factors, including: growth of our customer/merchant base as the result of expanded sales and marketing efforts; an increase in average merchant transaction volume as a result of a greater strategic focus on larger merchants; the expansion and growth of our advanced blockchain ledger-based payment solutions product offering, combined with an expanding ISO and partnership network; and our strategic acquisition strategy
  • Fourth quarter 2021 revenues were $7.1 million, compared to revenues of $3.0 million in the same quarter a year ago, an increase of $4.1 million or 138.6%.
  • 2021 gross profit was $16.9M, or 64% of revenue, an increase of 357% compared to $3.7M in the prior year, or 43% of revenue. Our margins increased significantly due to increased processing efficiency; greater utilization of lower cost gateways; and decreased cost to scale.
  • Fourth quarter 2021 gross profit was $3.0M, or 43% of revenue, as compared to $1.7M, or 56% of revenue, in the same period a year ago.
  • 2021 operating expenses increased by $28.9 million, or 328%, to $37.7 million from $8.8 million in the prior year. The increase was due to increases in generaland administrative, stock-based compensation, research and development, acquisition related due diligence and increased head count all to fuel the Company's growth initiatives.
  • Total operating expenses in the fourth quarter of 2021 totaled $11.7 million, compared to $5.2 million in the same quarter a year ago.
  • The Company sustained a net loss in 2021 of $26.5 million, or $0.65 per basic and diluted share, compared to a net loss of $5.0 million, or $0.17) per basic and diluted share during 2020. The increase in net loss was primarily due to increased operating expenses from stock-based compensation for services as wellas an increase in generaland administrative expenses.
  • Fourth quarter 2021 net loss was $7.0 million or $0.17 per basic and diluted share compared to a loss of $4.2 million or $0.14 per basic and diluted share during the same period prior year.
  • Adjusted Net Income, a non-GAAP financial measure, for 2021 was $3.0 million while Adjusted Net loss for the fourth quarter 2021 was $1.5 million.

Management will host a conference call on Thursday, March 31, 2021 at 4:30 p.m. Eastern time to discuss GreenBox's fourth quarter and full year 2021 financial results, provide a corporate update, and conclude with Q&A from telephone participants. To participate, please use the following information:

Q4 and Full Year 2021 Conference Call and Webcast

Date: Thursday, March 31, 2022

Time: 4:30 p.m. Eastern time

US Dial In: 1-877-407-4018

International Dial In: 1-201-689-8471

Conference ID: 13728060

Please dial in at least 10 minutes before the start of the call to ensure timely participation.