IBEX Limited (“ibex”), a leading provider in global business
process outsourcing and end-to-end customer engagement technology
solutions, today announced financial results for its third fiscal
quarter ended March 31, 2024.
“Our third quarter fiscal 2024 results were one
of the strongest in our history, with record levels of adjusted
EBITDA margin and adjusted EPS,” commented Bob Dechant, CEO of
ibex. “For the quarter, our adjusted EBITDA was $19.2 million,
resulting in record 15.1% adjusted EBITDA margin and $0.70 adjusted
EPS. Additionally, we continued to make great progress on the new
logo front, winning three new clients in the quarter, totaling 15
year-to-date versus eight logos in the prior year-to-date period. I
am proud of the performance and execution of our team,” added
Dechant.
“Strategically, we intend to be at the leading
edge of the transformation from traditional live agents to a
business that also offers AI virtual agents and automated
interactions to resolve certain customer contacts. We are creating
disruptive solutions for automation of customer contacts, including
language translation that will redefine the customer experience
business model, drive significant cost savings for our clients, and
go well beyond our current BPO services. We are doing so by
establishing key tech partnerships to deliver generative AI based
contact automation, language translation, and QA automation. Our
early sales and marketing efforts have yielded several pilots and
over 35 pipeline opportunities to date, with many already in the
later stage. We are excited by the future growth opportunities this
industry evolution creates for ibex.
“With the confidence in our business and our
ability to generate strong free cash flow, the ibex board of
directors have authorized a new Share Repurchase Plan for up to $30
million over the next 12 months,” added Dechant.
Third Quarter 2024 Key
Highlights
- Three new client relationships won
across HealthTech and new emerging Technology companies this
quarter, totaling fifteen for the year-to-date compared to eight in
the prior year-to-date period.
GAAP Financials:
- Third quarter revenue of $126.8
million declined 3.6% from the prior year quarter.
- Net income of $10.3 million
compared to $11.3 million in the prior year quarter. Net income
margin decreased to 8.1% from 8.6% in the prior year quarter.
- Diluted earnings per share
decreased to $0.57 from $0.59 in the prior year quarter.
Non-GAAP Financial Measures:
- Adjusted net income increased to
$12.6 million from $11.7 million in the prior year quarter.
- Adjusted earnings per share
increased to $0.70 from $0.61 in the prior year quarter.
- Adjusted EBITDA increased to $19.2
million from $18.8 million in the prior year quarter. Adjusted
EBITDA margin increased to 15.1% from 14.3% in the prior year
quarter.
Other Metrics:
- Repurchased 501,549 shares at a
total cost of $8.1 million in the third quarter for a total of
1,124,876 shares during fiscal year 2024.
Third Quarter Financial
PerformanceRevenue
- Revenue was $126.8 million,
compared to $131.6 million in the prior year quarter, a decrease of
3.6%. Revenues were impacted primarily by the conclusion of a
short-term client project in the third and fourth quarters of
fiscal year 2023, lower volumes in certain verticals and the year
over year shift of delivery from onshore to offshore regions.
- Growth in our Retail &
E-Commerce and Travel, Transportation & Logistics verticals
partially offset the above-mentioned revenue declines in our
FinTech and Telecommunications verticals.
Net Income and Earnings Per Share
- Net income was $10.3 million
compared to $11.3 million in the prior year quarter. Diluted
earnings per share decreased to $0.57 from $0.59 in the prior year
quarter.
- Net income margin decreased to 8.1%
from 8.6% in the prior year quarter.
- Non-GAAP adjusted net income
increased to $12.6 million from $11.7 million in the prior year
quarter. Non-GAAP adjusted diluted earnings per share increased to
$0.70 from $0.61 in the prior year quarter (see Exhibit 1 for
reconciliation). The increase per share was primarily attributable
to the impact of improved operating margins, lower share count, and
a lower tax rate.
Adjusted EBITDA
- Adjusted EBITDA increased to $19.2
million from $18.8 million in the prior year quarter (see Exhibit 2
for reconciliation) driven by higher operating margins and cost
optimization efforts undertaken during the quarter.
- Adjusted EBITDA margin increased to
15.1% from 14.3% in the prior year quarter (see Exhibit 2 for
reconciliation).
Cash Flow and Balance Sheet
- Net cash provided by operating
activities decreased to $11.4 million from $13.6 million in the
prior year quarter.
- Capital expenditures decreased to
$1.7 million from $3.7 million in the prior year quarter, as we
leveraged our capacity built out in prior years.
- Free cash flow of $9.7 million,
consistent with $9.8 million in the prior year quarter (see Exhibit
3 for reconciliation).
- Cash and cash equivalents was $50.7
million as of March 31, 2024, compared to cash and cash
equivalents of $57.4 million as of June 30, 2023, driven primarily
by the share repurchase program.
- Net cash position was $49.3 million
as of March 31, 2024, compared to $56.4 million as of June 30,
2023 (see Exhibit 4 for reconciliation).
“Our record adjusted EBITDA margin and adjusted
EPS was a result of margin improvements across all our regions and
the continued growth of our high margin services and geographies.
We accomplished these results while continuing to invest in
advanced AI capabilities to accelerate future revenue growth. In
addition, we had another strong quarter of generating Free Cash
Flow,” said Taylor Greenwald, CFO of ibex.
“We remain confident in our strategy to drive
growth in our higher margin offshore regions, accelerated by new
client wins, and to realize cost savings through optimizing our
site footprint that will continue to drive high-performing adjusted
EBITDA margins in the years ahead.
“As a result of our efforts, we anticipate
delivering full year results near the mid-point of our adjusted
EBITDA margin guidance while revenue will be near the lower end of
the guidance provided last quarter. We are also improving our
previous capital expenditures guidance as we continue to carefully
manage our capacity utilization.”
Fiscal Year 2024 Guidance
- Fiscal year 2024 revenue between $505 to $510 million.
- Adjusted EBITDA margin of approximately 12-13%.
- Capital expenditures revised downward to $10 to $13
million.
Conference Call and Webcast
InformationIBEX Limited will host a conference call and
live webcast to discuss its third quarter of fiscal year 2024
financial results at 4:30 p.m. Eastern Time today, May 9,
2024. We will also post to this section of our website the earning
slides, which will accompany our conference call and live webcast,
and encourage you to review the information that we make available
on our website.
Live and archived webcasts can be accessed
at: https://investors.ibex.co/.
Financial InformationThis
announcement does not contain sufficient information to constitute
an interim financial report as defined in Financial Accounting
Standards ASC 270, “Interim Reporting.” The financial information
in this press release has not been audited.
Non-GAAP Financial MeasuresWe
present non-GAAP financial measures because we believe that they
and other similar measures are widely used by certain investors,
securities analysts and other interested parties as supplemental
measures of performance and liquidity. We also use these measures
internally to establish forecasts, budgets and operational goals to
manage and monitor our business, as well as evaluate our underlying
historical performance, as we believe that these non-GAAP financial
measures provide a more helpful depiction of our performance of the
business by encompassing only relevant and manageable events,
enabling us to evaluate and plan more effectively for the future.
The non-GAAP financial measures may not be comparable to other
similarly titled measures of other companies, have limitations as
analytical tools, and should not be considered in isolation or as a
substitute for analysis of our operating results as reported in
accordance with accounting principles generally accepted in the
United States (“U.S. GAAP”). Non-GAAP financial measures and ratios
are not measurements of our performance, financial condition or
liquidity under U.S. GAAP and should not be considered as
alternatives to operating profit or net income / (loss) or as
alternatives to cash flow from operating, investing or financing
activities for the period, or any other performance measures,
derived in accordance with U.S. GAAP.
ibex is not providing a quantitative
reconciliation of forward-looking non-GAAP adjusted EBITDA margin
to the most directly comparable GAAP measure because it is unable
to predict with reasonable certainty the ultimate outcome of
certain significant items without unreasonable effort. These items
include, but are not limited to, non-recurring expenses, foreign
currency gains or losses, and share-based compensation expense.
These items are uncertain, depend on various factors, and could
have a material impact on GAAP reported results for the guidance
period.
About ibexibex helps the
world’s preeminent brands more effectively engage their customers
with services ranging from customer support, technical support,
inbound/outbound sales, business intelligence and analytics,
digital demand generation, and CX surveys and feedback
analytics.
Forward Looking StatementsIn
addition to historical information, this release contains
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. In some cases, you can
identify forward-looking statements by terminology such as
“believe,” “may,” “will,” “estimate,” “continue,” “anticipate,”
“intend,” “should,” “plan,” “expect,” “predict,” “potential,” or
the negative of these terms or other similar expressions. These
statements include, but are not limited to, statements regarding
our future financial and operating performance, including our
outlook and guidance, and our strategies, priorities and business
plans. Our expectations and beliefs regarding these matters may not
materialize, and actual results in future periods are subject to
risks and uncertainties that could cause actual results to differ
materially from those projected. Factors that could impact our
actual results include: general economic uncertainty in global
markets and unfavorable economic conditions, including inflation,
rising interest rates, recession, foreign exchange fluctuations and
supply-chain issues; geopolitical conditions, including developing
or ongoing conflicts; our ability to attract new business and
retain key clients; our profitability based on our utilization,
pricing and managing costs; the potential for our clients or
potential clients to consolidate; our clients deciding to enter
into or further expand their insourcing activities and current
trends toward outsourcing services may reverse; our ability to
manage our international operations, particularly in the
Philippines, Jamaica, Pakistan and Nicaragua; our ability to
anticipate, develop and implement information technology solutions
that keep pace with evolving industry standards and changing client
demands, including the effective adoption of Artificial
Intelligence into our offerings; our ability to recruit, engage,
motivate, manage and retain our global workforce; our ability to
comply with applicable laws and regulations, including those
regarding privacy, data protection and information security,
employment and anti-corruption; the effect of cyberattacks or
cybersecurity vulnerabilities on our information technology
systems; our ability to realize the anticipated strategic and
financial benefits of our relationship with Amazon; the impact of
tax matters, including new legislation and actions by taxing
authorities; and other factors discussed in the “Risk Factors”
described in our periodic reports filed with the U.S. Securities
and Exchange Commission (“SEC”), including our annual reports on
Form 10-K, quarterly reports on Form 10-Q, and past filings on Form
20-F, and any other risk factors we include in subsequent filings
with the SEC. Because of these uncertainties, you should not make
any investment decisions based on our estimates and forward-looking
statements. Except as required by law, we undertake no obligation
to publicly update any forward-looking statements for any reason
after the date of this press release whether as a result of new
information, future events or otherwise.
IR Contact: Michael
Darwal, EVP, Investor Relations, ibex,
michael.darwal@ibex.coMedia
Contact: Daniel Burris, Senior Director PR and
Communication, ibex, daniel.burris@ibex.co
IBEX LIMITED AND SUBSIDIARIES |
Consolidated Balance Sheets |
(Unaudited) |
(in thousands) |
|
|
|
|
March 31,2024 |
|
|
June 30,2023 |
Assets |
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
50,665 |
|
|
$ |
57,429 |
|
Accounts receivable, net |
|
|
103,317 |
|
|
|
86,364 |
|
Prepaid expenses |
|
|
5,885 |
|
|
|
6,616 |
|
Due from related parties |
|
|
164 |
|
|
|
43 |
|
Tax advances and receivables |
|
|
9,133 |
|
|
|
5,965 |
|
Other current assets |
|
|
2,187 |
|
|
|
2,190 |
|
Total current
assets |
|
|
171,351 |
|
|
|
158,607 |
|
|
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
|
Property and equipment, net |
|
|
31,465 |
|
|
|
41,151 |
|
Operating lease assets |
|
|
62,157 |
|
|
|
70,919 |
|
Goodwill |
|
|
11,832 |
|
|
|
11,832 |
|
Deferred tax asset, net |
|
|
3,998 |
|
|
|
4,585 |
|
Other non-current assets |
|
|
8,782 |
|
|
|
6,230 |
|
Total non-current
assets |
|
|
118,234 |
|
|
|
134,717 |
|
Total
assets |
|
$ |
289,585 |
|
|
$ |
293,324 |
|
|
|
|
|
|
|
|
Liabilities and
stockholders' equity |
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
17,538 |
|
|
$ |
18,705 |
|
Accrued payroll and employee-related liabilities |
|
|
30,791 |
|
|
|
29,360 |
|
Current deferred revenue |
|
|
5,396 |
|
|
|
6,413 |
|
Current operating lease liabilities |
|
|
13,073 |
|
|
|
13,036 |
|
Current maturities of long-term debt |
|
|
585 |
|
|
|
413 |
|
Due to related parties |
|
|
61 |
|
|
|
2,314 |
|
Income taxes payable |
|
|
3,320 |
|
|
|
3,020 |
|
Total current
liabilities |
|
|
70,764 |
|
|
|
73,261 |
|
|
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
|
Non-current deferred revenue |
|
|
1,302 |
|
|
|
1,383 |
|
Non-current operating lease liabilities |
|
|
55,660 |
|
|
|
64,854 |
|
Long-term debt |
|
|
820 |
|
|
|
600 |
|
Other non-current liabilities |
|
|
1,728 |
|
|
|
3,262 |
|
Total non-current
liabilities |
|
|
59,510 |
|
|
|
70,099 |
|
Total
liabilities |
|
|
130,274 |
|
|
|
143,360 |
|
|
|
|
|
|
|
|
Stockholders'
equity |
|
|
|
|
|
|
Common stock |
|
|
2 |
|
|
|
2 |
|
Additional paid-in capital |
|
|
209,062 |
|
|
|
204,734 |
|
Treasury stock |
|
|
(22,233 |
) |
|
|
(3,682 |
) |
Accumulated other comprehensive loss |
|
|
(6,552 |
) |
|
|
(6,312 |
) |
Accumulated deficit |
|
|
(20,968 |
) |
|
|
(44,778 |
) |
Total stockholders'
equity |
|
|
159,311 |
|
|
|
149,964 |
|
Total liabilities and
stockholders' equity |
|
$ |
289,585 |
|
|
$ |
293,324 |
|
|
IBEX LIMITED AND SUBSIDIARIES |
Consolidated Statements of Comprehensive
Income |
(Unaudited) |
(in thousands, except per share data) |
|
|
|
Three Months EndedMarch 31, |
|
Nine Months Ended March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Revenue |
|
$ |
126,795 |
|
|
$ |
131,557 |
|
|
$ |
384,038 |
|
|
$ |
398,687 |
|
|
|
|
|
|
|
|
|
|
Cost of services (exclusive of
depreciation and amortization presented separately below) |
|
|
87,083 |
|
|
|
91,693 |
|
|
|
271,163 |
|
|
|
287,636 |
|
Selling, general and
administrative |
|
|
23,565 |
|
|
|
22,139 |
|
|
|
71,462 |
|
|
|
64,946 |
|
Depreciation and
amortization |
|
|
4,865 |
|
|
|
4,674 |
|
|
|
14,853 |
|
|
|
13,933 |
|
Total operating expenses |
|
|
115,513 |
|
|
|
118,506 |
|
|
|
357,478 |
|
|
|
366,515 |
|
|
|
|
|
|
|
|
|
|
Income from
operations |
|
|
11,282 |
|
|
|
13,051 |
|
|
|
26,560 |
|
|
|
32,172 |
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
431 |
|
|
|
205 |
|
|
|
1,529 |
|
|
|
391 |
|
Interest expense |
|
|
(124 |
) |
|
|
(105 |
) |
|
|
(339 |
) |
|
|
(553 |
) |
Income before income
taxes |
|
|
11,589 |
|
|
|
13,151 |
|
|
|
27,750 |
|
|
|
32,010 |
|
|
|
|
|
|
|
|
|
|
Provision for income tax
expense |
|
|
(1,279 |
) |
|
|
(1,872 |
) |
|
|
(3,940 |
) |
|
|
(4,938 |
) |
Net
income |
|
$ |
10,310 |
|
|
$ |
11,279 |
|
|
$ |
23,810 |
|
|
$ |
27,072 |
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income / (loss) |
|
|
|
|
|
|
|
|
Foreign currency translation adjustments |
|
$ |
(288 |
) |
|
$ |
(1,039 |
) |
|
$ |
(310 |
) |
|
$ |
(2,162 |
) |
Unrealized (loss) / gain on cash flow hedging instruments, net of
tax |
|
|
(131 |
) |
|
|
216 |
|
|
|
70 |
|
|
|
769 |
|
Total other comprehensive
loss |
|
|
(419 |
) |
|
|
(823 |
) |
|
|
(240 |
) |
|
|
(1,393 |
) |
Total comprehensive
income |
|
$ |
9,891 |
|
|
$ |
10,456 |
|
|
$ |
23,570 |
|
|
$ |
25,679 |
|
|
|
|
|
|
|
|
|
|
Net income per
share |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.59 |
|
|
$ |
0.62 |
|
|
$ |
1.33 |
|
|
$ |
1.49 |
|
Diluted |
|
$ |
0.57 |
|
|
$ |
0.59 |
|
|
$ |
1.29 |
|
|
$ |
1.44 |
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding |
|
|
|
|
|
|
|
|
Basic |
|
|
17,468 |
|
|
|
18,230 |
|
|
|
17,880 |
|
|
|
18,179 |
|
Diluted |
|
|
18,036 |
|
|
|
19,065 |
|
|
|
18,458 |
|
|
|
18,861 |
|
|
IBEX LIMITED AND SUBSIDIARIES |
Consolidated Statements of Cash Flows |
(Unaudited) |
(in thousands) |
|
|
|
Three Months EndedMarch 31, |
|
Nine Months EndedMarch 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
CASH FLOWS FROM
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
Net income |
|
$ |
10,310 |
|
|
$ |
11,279 |
|
|
$ |
23,810 |
|
|
$ |
27,072 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
4,865 |
|
|
|
4,674 |
|
|
|
14,853 |
|
|
|
13,933 |
|
Noncash lease expense |
|
|
3,386 |
|
|
|
3,673 |
|
|
|
9,908 |
|
|
|
10,946 |
|
Warrant contra revenue |
|
|
299 |
|
|
|
260 |
|
|
|
893 |
|
|
|
856 |
|
Deferred income tax |
|
|
290 |
|
|
|
1,512 |
|
|
|
586 |
|
|
|
3,018 |
|
Share-based compensation expense |
|
|
466 |
|
|
|
1,318 |
|
|
|
2,741 |
|
|
|
3,973 |
|
Allowance of expected credit losses |
|
|
56 |
|
|
|
(12 |
) |
|
|
62 |
|
|
|
105 |
|
Impairment losses |
|
|
1,257 |
|
|
|
— |
|
|
|
1,257 |
|
|
|
— |
|
Gain on sale of subsidiaries |
|
|
— |
|
|
|
(246 |
) |
|
|
— |
|
|
|
(246 |
) |
Change in assets and liabilities: |
|
|
|
|
|
|
|
|
Decrease / (increase) in accounts receivable |
|
|
1,395 |
|
|
|
426 |
|
|
|
(16,941 |
) |
|
|
(17,846 |
) |
(Increase) / decrease in prepaid expenses and other current
assets |
|
|
(3,158 |
) |
|
|
(981 |
) |
|
|
(5,350 |
) |
|
|
2,242 |
|
Decrease in accounts payable and accrued liabilities |
|
|
(2,880 |
) |
|
|
(4,795 |
) |
|
|
(2,336 |
) |
|
|
(6,077 |
) |
Decrease in deferred revenue |
|
|
(1,399 |
) |
|
|
184 |
|
|
|
(1,098 |
) |
|
|
(2,721 |
) |
Decrease in operating lease liabilities |
|
|
(3,456 |
) |
|
|
(3,723 |
) |
|
|
(9,907 |
) |
|
|
(10,831 |
) |
Net cash inflow from operating activities |
|
|
11,431 |
|
|
|
13,569 |
|
|
|
18,478 |
|
|
|
24,424 |
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
Purchase of property and equipment |
|
|
(1,691 |
) |
|
|
(3,725 |
) |
|
|
(6,635 |
) |
|
|
(15,231 |
) |
Cash outflow from sale of subsidiaries, net of cash received |
|
|
— |
|
|
|
(85 |
) |
|
|
— |
|
|
|
(85 |
) |
Net cash outflow from investing activities |
|
|
(1,691 |
) |
|
|
(3,810 |
) |
|
|
(6,635 |
) |
|
|
(15,316 |
) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Proceeds from line of credit |
|
|
57 |
|
|
|
4,076 |
|
|
|
153 |
|
|
|
43,390 |
|
Repayments of line of credit |
|
|
(57 |
) |
|
|
(8,241 |
) |
|
|
(205 |
) |
|
|
(54,541 |
) |
Repayment of debt |
|
|
— |
|
|
|
(271 |
) |
|
|
— |
|
|
|
(3,795 |
) |
Proceeds from the exercise of options |
|
|
351 |
|
|
|
618 |
|
|
|
362 |
|
|
|
1,827 |
|
Principal payments on finance leases |
|
|
(138 |
) |
|
|
(87 |
) |
|
|
(342 |
) |
|
|
(353 |
) |
Purchase of treasury shares |
|
|
(8,277 |
) |
|
|
— |
|
|
|
(18,551 |
) |
|
|
(276 |
) |
Net cash outflow from financing activities |
|
|
(8,064 |
) |
|
|
(3,905 |
) |
|
|
(18,583 |
) |
|
|
(13,748 |
) |
Effects of exchange rate difference on cash and cash
equivalents |
|
|
(27 |
) |
|
|
(260 |
) |
|
|
(24 |
) |
|
|
(515 |
) |
Net increase / (decrease) in cash and cash equivalents |
|
|
1,649 |
|
|
|
5,594 |
|
|
|
(6,764 |
) |
|
|
(5,155 |
) |
Cash and cash equivalents, beginning |
|
|
49,016 |
|
|
|
38,082 |
|
|
|
57,429 |
|
|
|
48,831 |
|
Cash and cash
equivalents, ending |
|
$ |
50,665 |
|
|
$ |
43,676 |
|
|
$ |
50,665 |
|
|
$ |
43,676 |
|
|
IBEX LIMITED AND SUBSIDIARIES |
Reconciliation of GAAP Financial Measures to Non-GAAP
Financial Measures |
|
EXHIBIT 1: Adjusted net income and adjusted earnings per
share |
|
We define adjusted net income as net income before the effect of
the following items: non-recurring expenses (including legal and
settlement costs), severance costs, impairment losses, warrant
contra revenue, foreign currency gains or losses, gain on sale
of subsidiaries, and share-based compensation expense, net of the
tax impact of such adjustments. We define adjusted earnings
per share as adjusted net income divided by weighted average
diluted shares outstanding. The following table provides a
reconciliation of net income to adjusted net income and diluted
earnings per share to adjusted earnings per share for the periods
presented: |
|
($000s, except per share
amounts) |
|
Three Months EndedMarch 31, |
|
Nine Months EndedMarch 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net
income |
|
$ |
10,310 |
|
|
$ |
11,279 |
|
|
$ |
23,810 |
|
|
$ |
27,072 |
|
Net income
margin |
|
|
8.1 |
% |
|
|
8.6 |
% |
|
|
6.2 |
% |
|
|
6.8 |
% |
|
|
|
|
|
|
|
|
|
Non-recurring expenses |
|
|
— |
|
|
|
84 |
|
|
|
— |
|
|
|
876 |
|
Severance costs |
|
|
1,506 |
|
|
|
— |
|
|
|
1,506 |
|
|
|
— |
|
Impairment losses |
|
|
1,257 |
|
|
|
— |
|
|
|
1,257 |
|
|
|
— |
|
Warrant contra revenue |
|
|
299 |
|
|
|
260 |
|
|
|
893 |
|
|
|
856 |
|
Foreign currency gains |
|
|
(471 |
) |
|
|
(325 |
) |
|
|
(571 |
) |
|
|
(422 |
) |
Gain on sale of
subsidiaries |
|
|
— |
|
|
|
(246 |
) |
|
|
— |
|
|
|
(246 |
) |
Share-based compensation
expense |
|
|
466 |
|
|
|
1,318 |
|
|
|
2,741 |
|
|
|
3,973 |
|
Total
adjustments |
|
$ |
3,057 |
|
|
$ |
1,091 |
|
|
$ |
5,826 |
|
|
$ |
5,037 |
|
Tax impact of
adjustments1 |
|
|
(809 |
) |
|
|
(696 |
) |
|
|
(1,480 |
) |
|
|
(1,406 |
) |
Adjusted net
income |
|
$ |
12,558 |
|
|
$ |
11,674 |
|
|
$ |
28,156 |
|
|
$ |
30,703 |
|
Adjusted net income
margin |
|
|
9.9 |
% |
|
|
8.9 |
% |
|
|
7.3 |
% |
|
|
7.7 |
% |
|
|
|
|
|
|
|
|
|
Diluted earnings per
share |
|
$ |
0.57 |
|
|
$ |
0.59 |
|
|
$ |
1.29 |
|
|
$ |
1.44 |
|
Per share impact of
adjustments to net income |
|
|
0.12 |
|
|
|
0.02 |
|
|
|
0.24 |
|
|
|
0.19 |
|
Adjusted earnings per
share |
|
$ |
0.70 |
|
|
$ |
0.61 |
|
|
$ |
1.53 |
|
|
$ |
1.63 |
|
|
|
|
|
|
|
|
|
|
Weighted average
diluted shares outstanding |
|
|
18,036 |
|
|
|
19,065 |
|
|
|
18,458 |
|
|
|
18,861 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1The tax impact
of each adjustment is calculated using the effective tax rate in
the relevant jurisdictions. |
|
EXHIBIT
2: EBITDA, adjusted EBITDA, and adjusted EBITDA
margin |
|
EBITDA is a
non-GAAP profitability measure that represents net income before
the effect of the following items: interest expense, income tax
expense, and depreciation and amortization. Adjusted EBITDA is a
non-GAAP profitability measure that represents EBITDA before the
effect of the following items: non-recurring expenses (including
legal and settlement costs), severance costs, impairment losses,
interest income, warrant contra revenue, foreign currency gains or
losses, gain on sale of subsidiaries, and share-based compensation
expense. Adjusted EBITDA margin is a non-GAAP profitability measure
that represents adjusted EBITDA divided by revenue. The following
table provides a reconciliation of net income and net income margin
to adjusted EBITDA and adjusted EBITDA margin for the periods
presented: |
|
|
|
Three Months EndedMarch 31, |
|
Nine Months EndedMarch 31, |
($000s) |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net
income |
|
$ |
10,310 |
|
|
$ |
11,279 |
|
|
$ |
23,810 |
|
|
$ |
27,072 |
|
Net income
margin |
|
|
8.1 |
% |
|
|
8.6 |
% |
|
|
6.2 |
% |
|
|
6.8 |
% |
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
124 |
|
|
|
105 |
|
|
|
339 |
|
|
|
553 |
|
Income tax expense |
|
|
1,279 |
|
|
|
1,872 |
|
|
|
3,940 |
|
|
|
4,938 |
|
Depreciation and
amortization |
|
|
4,865 |
|
|
|
4,674 |
|
|
|
14,853 |
|
|
|
13,933 |
|
EBITDA |
|
$ |
16,578 |
|
|
$ |
17,930 |
|
|
$ |
42,942 |
|
|
$ |
46,496 |
|
Non-recurring expenses |
|
|
— |
|
|
|
84 |
|
|
|
— |
|
|
|
876 |
|
Severance costs |
|
|
1,506 |
|
|
|
— |
|
|
|
1,506 |
|
|
|
— |
|
Impairment losses |
|
|
1,257 |
|
|
|
— |
|
|
|
1,257 |
|
|
|
— |
|
Interest income |
|
|
(431 |
) |
|
|
(205 |
) |
|
|
(1,529 |
) |
|
|
(391 |
) |
Warrant contra revenue |
|
|
299 |
|
|
|
260 |
|
|
|
893 |
|
|
|
856 |
|
Foreign currency gains |
|
|
(471 |
) |
|
|
(325 |
) |
|
|
(571 |
) |
|
|
(422 |
) |
Gain on sale of
subsidiaries |
|
|
— |
|
|
|
(246 |
) |
|
|
— |
|
|
|
(246 |
) |
Share-based compensation
expense |
|
|
466 |
|
|
|
1,318 |
|
|
|
2,741 |
|
|
|
3,973 |
|
Adjusted
EBITDA |
|
$ |
19,204 |
|
|
$ |
18,816 |
|
|
$ |
47,239 |
|
|
$ |
51,142 |
|
Adjusted EBITDA
margin |
|
|
15.1 |
% |
|
|
14.3 |
% |
|
|
12.3 |
% |
|
|
12.8 |
% |
|
EXHIBIT 3: Free cash flow |
|
We define free cash flow as net cash provided by operating
activities less capital expenditures. |
|
|
|
Three Months EndedMarch 31, |
|
Nine Months EndedMarch 31, |
($000s) |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net cash provided by
operating activities |
|
$ |
11,431 |
|
|
$ |
13,569 |
|
|
$ |
18,478 |
|
|
$ |
24,424 |
|
Less: capital
expenditures |
|
|
1,691 |
|
|
|
3,725 |
|
|
|
6,635 |
|
|
|
15,231 |
|
Free cash
flow |
|
$ |
9,740 |
|
|
$ |
9,844 |
|
|
$ |
11,843 |
|
|
$ |
9,193 |
|
|
EXHIBIT 4: Net cash |
|
We define net cash as total cash and cash equivalents less
debt. |
|
|
|
March 31, |
|
June 30, |
($000s) |
|
2024 |
|
2023 |
Cash and cash equivalents |
|
$ |
50,665 |
|
|
$ |
57,429 |
|
|
|
|
|
|
Debt |
|
|
|
|
Current |
|
$ |
585 |
|
|
$ |
413 |
|
Non-current |
|
|
820 |
|
|
|
600 |
|
Total debt |
|
$ |
1,405 |
|
|
$ |
1,013 |
|
Net cash |
|
$ |
49,260 |
|
|
$ |
56,416 |
|
|
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