Second Quarter 2023
Revenue was $600.4 Million
Operating Income was $31.3 Million or
5.2 Percent of Revenue
($50.6 Million or 8.4 Percent of
Revenue Non-GAAP)
Net Income was $3.8 Million or
0.6 Percent of Revenue
($25.9 Million or 4.3 Percent of
Revenue Non-GAAP)
Adjusted EBITDA was $67.2 Million or
11.2 Percent of Revenue
Fully Diluted EPS was $0.08
($0.55 Non-GAAP)
Reiterates Outlook for Full Year 2023
DENVER, Aug. 3, 2023
/PRNewswire/ -- TTEC Holdings, Inc. (NASDAQ:TTEC), a leading
global CX (customer experience) technology and services innovator
for AI-enabled CX with solutions from TTEC Engage and TTEC Digital,
announced today financial results for the second quarter ended
June 30, 2023.
"We delivered on our top priorities this quarter and exceeded
the mid-point of our communicated financial guidance," commented
Ken Tuchman, Chairman and chief
executive officer of TTEC. "We made meaningful progress in TTEC
Engage by further expanding our geographic footprint and language
capabilities as well as continuing to grow our client portfolio
with a focus on resilient verticals, including financial services,
healthcare and public sector. In TTEC Digital, we expanded our
strategic CX technology partnerships, launched new and innovative
AI-related offerings, and continued to accelerate our pace of cloud
migrations for clients. While it is early in the adoption of
Generative AI for CX, we are actively working with our clients and
CX technology partners on exciting pilots using private large
language models, augmentation solutions for contact center
associates, knowledge management solutions for AI-enablement, and
advanced CX analytics."
Tuchman continued, "We enter the second half of the year with a
healthy sales funnel and backlog. Recognizing that some of our
clients are cautious in light of difficult to predict consumer
demand, we maintain a prudent outlook for the remainder of the
year. We have a high level of confidence in the factors we control
and will remain agile and adapt to market conditions as they
evolve."
SECOND QUARTER 2023 FINANCIAL
HIGHLIGHTS
Revenue
- Second quarter 2023 GAAP revenue decreased 0.6 percent to
$600.4 million compared to
$604.3 million in the prior year
period.
- Foreign exchange had a $1.2
million negative impact on revenue in the second quarter of
2023.
Income from Operations
- Second quarter 2023 GAAP income from operations was
$31.3 million, or 5.2 percent of
revenue, compared to $35.9 million,
or 5.9 percent of revenue in the prior year period.
- Non-GAAP income from operations, excluding restructuring and
impairment charges, equity-based compensation expenses,
amortization of purchased intangibles, and other items, was
$50.6 million, or 8.4 percent of
revenue, compared to $61.2 million,
or 10.1 percent for the prior year period.
- Foreign exchange had a $1.4
million positive impact on Non-GAAP income from operations
in the second quarter of 2023.
Adjusted EBITDA
- Second quarter 2023 Non-GAAP Adjusted EBITDA was $67.2 million, or 11.2 percent of revenue,
compared to $80.6 million, or 13.3
percent of revenue in the prior year period.
Earnings Per Share
- Second quarter 2023 GAAP fully diluted earnings per share was
$0.08 compared to $0.61 for the same period last year.
- Non-GAAP fully diluted earnings per share was $0.55 compared to $0.93 in the prior year period.
CASH FLOW AND BALANCE SHEET FUND INVESTMENTS AND
DIVIDENDS
- Cash flow from operations in the second quarter 2023 was
$95.9 million compared to
$77.6 million for the second quarter
2022.
- Capital expenditures in the second quarter 2023 were
$19.3 million compared to
$19.1 million for the second quarter
2022.
- As of June 30, 2023, TTEC had
cash and cash equivalents of $114.8
million and debt of $919.0 million, resulting in a net debt
position of $804.2 million. This
compares to a net debt position of $771.5
million for the same period 2022. The increase in net debt
is primarily attributable to capital distributions and
acquisition-related investments, partially offset by positive cash
flow from operations.
- As of June 30, 2023, TTEC's
remaining borrowing capacity under its revolving credit facility
was approximately $265 million compared to $425 million for the same period 2022.
- TTEC paid a $0.52 per share, or
$24.6 million, semi-annual dividend
on April 20, 2023 to shareholders of
record on March 31, 2023. This
dividend is unchanged over the October
2022 dividend and a 4.0 percent increase over the
April 2022 dividend.
SEGMENT REPORTING & COMMENTARY
TTEC reports financial results for the following two business
segments: TTEC Digital (Digital) and TTEC Engage (Engage).
Financial highlights for the two segments are provided below.
TTEC Digital – Design, build and operate tech-enabled,
insight-driven CX solutions
- Second quarter 2023 GAAP revenue for TTEC Digital increased 2.8
percent to $117.6 million from
$114.4 million for the year ago
period. Income from operations was $7.2
million or 6.1 percent of revenue compared to operating
income of $10.8 million or 9.4
percent of revenue for the prior year period.
- Non-GAAP income from operations was $14.7 million, or 12.5 percent of revenue
compared to operating income of $16.9
million or 14.8 percent of revenue in the prior year
period.
TTEC Engage – Digitally-enabled customer care, acquisition,
and fraud mitigation services
- Second quarter 2023 GAAP revenue for TTEC Engage decreased 1.4
percent to $482.8 million from
$489.8 million for the year ago
period. Income from operations was $24.1
million or 5.0 percent of revenue compared to operating
income of $25.1 million, or 5.1
percent of revenue for the prior year period.
- Non-GAAP income from operations was $35.9 million, or 7.4 percent of revenue,
compared to operating income of $44.2
million, or 9.0 percent of revenue in the prior year
period.
- Foreign exchange had a $0.8
million negative impact on revenue and $1.5 million positive impact on Non-GAAP income
from operations.
BUSINESS OUTLOOK
"We are pleased with our execution and second quarter financial
results, in-line with our plan and above the mid-point of our
revenue and profit guidance range," commented Francois Bourret, Interim Chief Financial
Officer of TTEC. "In the second quarter, we prioritized
investments around our CX technology capabilities and global
delivery footprint expansion, while maintaining a company-wide
agile cost structure."
Bourret continued, "Looking at the remainder of 2023, we
continue to operate in a dynamic environment where consumers and
organizations are taking a cautious approach to their spending
priorities. This is impacting select clients' level of confidence,
which may impact volumes as well as timing to commit to CX
technology investments for the second half of the year. We remain
focused on our execution and are re-affirming the mid-point of our
full-year 2023 revenue and profit guidance range."
TTEC Full Year 2023 Outlook
|
|
|
|
|
|
|
|
|
Third Quarter 2023
Guidance
|
|
Third Quarter 2023
Mid-Point
|
|
Full Year 2023
Guidance
|
|
Full Year 2023
Mid-Point
|
Revenue
|
$593M —
$613M
|
|
$603M
|
|
$2,470M —
$2,530M
|
|
$2,500M
|
Non-GAAP adjusted
EBITDA
|
$60M —
$66M
|
|
$63M
|
|
$290M —
$310M
|
|
$300M
|
Non-GAAP adjusted
EBITDA margins
|
10.1% —
10.7%
|
|
10.4 %
|
|
11.7% —
12.3%
|
|
12.0 %
|
Non-GAAP operating
income
|
$44M —
$50M
|
|
$47M
|
|
$221M —
$241M
|
|
$231M
|
Non-GAAP operating
income margins
|
7.4% —
8.1%
|
|
7.8 %
|
|
9.0% —
9.5%
|
|
9.3 %
|
Interest expense,
net
|
($18M) —
($20M)
|
|
($19M)
|
|
($74M) —
($76M)
|
|
($75M)
|
Non-GAAP adjusted tax
rate
|
24% — 26%
|
|
25 %
|
|
24% — 26%
|
|
25 %
|
Diluted share
count
|
47.3M —
47.5M
|
|
47.4M
|
|
47.3M —
47.5M
|
|
47.4M
|
Non-GAAP earnings per a
share
|
$0.38 —
$0.47
|
|
$0.43
|
|
$2.38 —
$2.70
|
|
$2.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Engage Full Year 2023 outlook
|
|
|
|
|
|
|
|
|
Third Quarter 2023
Guidance
|
|
Third Quarter 2023
Mid-Point
|
|
Full Year 2023
Guidance
|
|
Full Year 2023
Mid-Point
|
Revenue
|
$469M —
$481M
|
|
$475M
|
|
$1,980M —
$2,020M
|
|
$2,000M
|
Non-GAAP adjusted
EBITDA
|
$42M —
$46M
|
|
$44M
|
|
$221M —
$235M
|
|
$228M
|
Non-GAAP adjusted
EBITDA margins
|
9.0% —
9.6%
|
|
9.3 %
|
|
11.2% —
11.6%
|
|
11.4 %
|
Non-GAAP operating
income
|
$30M —
$34M
|
|
$32M
|
|
$164M —
$178M
|
|
$171M
|
Non-GAAP operating
income margins
|
6.3% —
7.0%
|
|
6.7 %
|
|
8.3% —
8.8%
|
|
8.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Digital Full Year 2023 outlook
|
|
|
|
|
|
|
|
|
Third Quarter 2023
Guidance
|
|
Third Quarter 2023
Mid-Point
|
|
Full Year 2023
Guidance
|
|
Full Year 2023
Mid-Point
|
Revenue
|
$124M —
$132M
|
|
$128M
|
|
$490M —
$510M
|
|
$500M
|
Non-GAAP adjusted
EBITDA
|
$17M —
$19M
|
|
$18M
|
|
$69M —
$75M
|
|
$72M
|
Non-GAAP adjusted
EBITDA margins
|
14.0% —
14.7%
|
|
14.3 %
|
|
14.1% —
14.7%
|
|
14.4 %
|
Non-GAAP operating
income
|
$14M —
$16M
|
|
$15M
|
|
$57M —
$63M
|
|
$60M
|
Non-GAAP operating
income margins
|
11.5% —
12.3%
|
|
11.9 %
|
|
11.7% —
12.4%
|
|
12.1 %
|
The Company has not quantitatively reconciled its guidance for
Non-GAAP operating income, Non-GAAP operating income margins,
Non-GAAP adjusted EBITDA, Non-GAAP adjusted EBITDA margins, or
Non-GAAP earnings per share to their respective most comparable
GAAP measures because certain of the reconciling items that impact
these metrics, including restructuring and impairment charges,
cybersecurity incident-related costs, equity-based compensation
expense, changes in acquisition contingent consideration,
depreciation and amortization expense, and provision for income
taxes are dependent on the timing of future events outside of the
Company's control or cannot be reliably predicted. Accordingly, the
Company is unable to provide reconciliations to GAAP operating
income, operating income margins, net income margins, and diluted
earnings per share without unreasonable effort. Please note that
the unavailable reconciling items could significantly impact the
Company's 2023 financial results as reported under GAAP.
NON-GAAP FINANCIAL MEASURES
This press release contains a discussion of certain Non-GAAP
financial measures that the Company includes to allow investors and
analysts to measure, analyze and compare its financial condition
and results of operations in a meaningful and consistent manner. A
reconciliation of these Non-GAAP financial measures can be found in
the tables accompanying this press release.
- GAAP metrics are presented in accordance with Generally
Accepted Accounting Principles.
- Non-GAAP - As reflected in the attached reconciliation
table, the definition of Non-GAAP may exclude from operating
income, EBITDA, net income and earnings per share restructuring and
impairment charges, equity-based compensation expenses,
amortization of purchased intangibles, among other items.
ABOUT TTEC
TTEC Holdings, Inc. (NASDAQ: TTEC) is a leading global
CX (customer experience) technology and services innovator for
AI-enabled digital CX solutions. The Company delivers leading
CX technology and operational CX orchestration at scale
through its proprietary cloud-based CXaaS (Customer Experience as a
Service) platform. Serving iconic and disruptive brands,
TTEC's outcome-based solutions span the entire enterprise,
touch every virtual interaction channel, and improve each step
of the customer journey. Leveraging next gen digital and cognitive
technology, the Company's Digital business designs, builds, and
operates omnichannel contact center technology, conversational
messaging, CRM, automation (AI / ML and RPA), and analytics
solutions. The Company's Engage business delivers digital
customer engagement, customer acquisition and growth, content
moderation, fraud prevention, and data annotation
solutions. Founded in 1982, the Company's singular
obsession with CX excellence has earned it leading client NPS
scores across the globe. The Company's 63,900 employees
operate on six continents and bring technology and humanity
together to deliver happy customers and differentiated
business results. To learn more visit us
at https://www.ttec.com
FORWARD-LOOKING STATEMENTS
This earnings release contains "forward-looking statements"
within the meaning of Section 27A of the Securities Act of
1933, Section 21E of the Securities Exchange Act of 1934, and
the Private Securities Litigation Reform Act of 1995, relating to
our operations, expected financial position, results of operation,
and other business matters that are based on our current
expectations, assumptions, and projections with respect to the
future, and are not a guarantee of performance. In this release
when we use words such as "may," "believe," "plan," "will,"
"anticipate," "estimate," "expect," "intend," "project," "would,"
"could," "target," or similar expressions, or when we discuss our
strategy, plans, goals, initiatives, or objectives, we are making
forward-looking statements.
We caution you not to rely unduly on any forward-looking
statements. Actual results may differ materially from those
expressed in the forward-looking statements, and you should review
and consider carefully the risks, uncertainties, and other factors
that affect our business and may cause such differences as outlined
in Item 1A. Risk Factors in our Annual Report on Form 10-K for the
year ended December 31, 2022 and any
subsequent filings with the U.S. Securities and Exchange Commission
(the "SEC") which are available on TTEC's website
www.ttec.com, and on the SEC's public website at
www.sec.gov. Important factors that could cause our
actual results to differ materially from those indicated in the
forward looking statements include, among others: the risks related
to our business operations and strategy in a competitive market;
our ability to innovate and introduce disruptive technologies that
would allow us to maintain and grow our market share (e.g.,
effective adoption of artificial intelligence into our solutions);
risks that may arise in connection with events outside of our
control (macroeconomic conditions, geopolitical tensions, outbreaks
of infectious diseases); risks inherent in a disruption and
cybersecurity of our information technology systems, including
cybersecurity criminal activity, which can impact our ability to
consistently deliver uninterrupted service to our clients or
unauthorized access to data, any of which may result in government
investigations and enforcement actions, and private legal actions;
risks inherent in the delivery of services by employees working
from home; our ability to attract and retain qualified personnel at
a price point that we can afford and our clients are willing to
pay; our M&A activity, including our ability to properly
integrate acquired businesses; our reliance on a relatively small
number of TTEC Engage clients to generate the majority of our
revenue and our reliance on technology partners to generate a large
portion of TTEC Digital's revenue; the changes in laws and
regulations that impact our and our clients' businesses, including
the rapidly changing data privacy and data protection laws,
healthcare business regulations, financial and public sector
specific regulations; the cost of labor and data privacy litigation
and other class action litigation; the risks related to our
international operations including the stress that geographic
expansion may have on our business, the impact if we are unable to
expand geographically to meet our clients' demand; and risks
inherent in our equity structure including our controlling
shareholder risk, and Delaware
choice of dispute resolution risks.
Our forward-looking statements speak only as of the date that
this release is issued. We undertake no obligation to update them,
except as may be required by applicable law. Although we believe
that our forward-looking statements are reasonable, they depend on
many factors outside of our control and we can provide no assurance
that they will prove to be correct.
Investor Relations Contact
Paul
Miller
+1.303.397.8641
|
Address
6312 S Fiddler's
Green Circle, 100N
Greenwood Village, CO
80111
|
Communications
Contact
Tim Blair
tim.blair@ttec.com
+1.303.397.9267
|
TTEC HOLDINGS, INC. AND
SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
(In thousands, except per share
data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
Six months ended
|
|
|
|
June 30,
|
|
June 30,
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$600,394
|
|
$604,250
|
|
$1,233,680
|
|
$1,192,976
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
Cost of
services
|
|
464,686
|
|
463,510
|
|
947,364
|
|
910,725
|
|
Selling, general and
administrative
|
|
75,338
|
|
66,766
|
|
149,348
|
|
131,605
|
|
Depreciation and
amortization
|
|
24,946
|
|
26,314
|
|
50,773
|
|
52,944
|
|
Restructuring charges,
net
|
|
1,474
|
|
2,528
|
|
3,527
|
|
3,148
|
|
Impairment
losses
|
|
2,652
|
|
9,248
|
|
6,959
|
|
10,360
|
Total operating expenses
|
|
569,096
|
|
568,366
|
|
1,157,971
|
|
1,108,782
|
|
|
|
|
|
|
|
|
|
|
Income From Operations
|
|
31,298
|
|
35,884
|
|
75,709
|
|
84,194
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense),
net
|
|
(21,439)
|
|
188
|
|
(37,011)
|
|
(2,118)
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
9,859
|
|
36,072
|
|
38,698
|
|
82,076
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
(6,102)
|
|
(7,274)
|
|
(14,024)
|
|
(15,308)
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
3,757
|
|
28,798
|
|
24,674
|
|
66,768
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable
to noncontrolling interest
|
(2,546)
|
|
(3,564)
|
|
(4,816)
|
|
(8,130)
|
|
|
|
|
|
|
|
|
|
|
Net Income Attributable to TTEC
Stockholders
|
$
1,211
|
|
$
25,234
|
|
$ 19,858
|
|
$ 58,638
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ 0.08
|
|
$ 0.61
|
|
$
0.52
|
|
$
1.42
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$ 0.08
|
|
$ 0.61
|
|
$
0.52
|
|
$
1.41
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share Attributable to TTEC
Stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ 0.03
|
|
$ 0.54
|
|
$
0.42
|
|
$
1.25
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$ 0.03
|
|
$ 0.53
|
|
$
0.42
|
|
$
1.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income From Operations Margin
|
|
5.2 %
|
|
5.9 %
|
|
6.1 %
|
|
7.1 %
|
Net Income Margin
|
|
0.6 %
|
|
4.8 %
|
|
2.0 %
|
|
5.6 %
|
Net Income Attributable to TTEC Stockholders
Margin
|
0.2 %
|
|
4.2 %
|
|
1.6 %
|
|
4.9 %
|
Effective Tax Rate
|
|
61.9 %
|
|
20.2 %
|
|
36.2 %
|
|
18.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares
Outstanding
|
|
|
|
|
|
|
|
Basic
|
|
47,264
|
|
47,047
|
|
47,249
|
|
47,026
|
Diluted
|
|
47,453
|
|
47,383
|
|
47,417
|
|
47,381
|
TTEC HOLDINGS, INC. AND
SUBSIDIARIES
|
SEGMENT INFORMATION
|
(In thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
Six months ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
TTEC Digital
|
|
$117,585
|
|
$114,433
|
|
$
234,512
|
|
$
225,847
|
TTEC Engage
|
|
482,809
|
|
489,817
|
|
999,168
|
|
967,129
|
Total
|
|
$600,394
|
|
$604,250
|
|
$1,233,680
|
|
$1,192,976
|
|
|
|
|
|
|
|
|
|
Income From Operations:
|
|
|
|
|
|
|
|
|
TTEC Digital
|
|
$
7,154
|
|
$
10,751
|
|
$ 7,939
|
|
$ 16,956
|
TTEC Engage
|
|
24,144
|
|
25,133
|
|
67,770
|
|
67,238
|
Total
|
|
$
31,298
|
|
$
35,884
|
|
$ 75,709
|
|
$
84,194
|
TTEC HOLDINGS, INC. AND
SUBSIDIARIES
|
CONSOLIDATED BALANCE SHEETS
|
(In thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
|
|
2023
|
|
2022
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and
cash equivalents
|
|
$
114,776
|
|
$
153,435
|
Accounts
receivable, net
|
|
402,664
|
|
417,637
|
Other
current assets
|
|
203,697
|
|
178,898
|
Total current
assets
|
|
721,137
|
|
749,970
|
|
|
|
|
|
Property and equipment,
net
|
|
189,049
|
|
183,360
|
Operating lease
assets
|
|
111,764
|
|
92,431
|
Goodwill
|
|
808,613
|
|
807,845
|
Other intangibles
assets, net
|
|
216,168
|
|
233,909
|
Other assets
|
|
124,578
|
|
86,447
|
|
|
|
|
|
Total assets
|
|
$2,171,309
|
|
$ 2,153,962
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
|
$ 84,335
|
|
$
93,937
|
Accrued
employee compensation and benefits
|
|
149,919
|
|
145,096
|
Deferred
revenue
|
|
91,757
|
|
87,846
|
Current
operating lease liabilities
|
|
35,620
|
|
35,271
|
Other
current liabilities
|
|
89,607
|
|
49,214
|
Total current
liabilities
|
|
451,238
|
|
411,364
|
|
|
|
|
|
Long-term
liabilities:
|
|
|
|
|
Line of
credit
|
|
915,000
|
|
960,000
|
Non-current operating lease liabilities
|
|
89,388
|
|
69,575
|
Other
long-term liabilities
|
|
74,144
|
|
79,273
|
Total long-term
liabilities
|
|
1,078,532
|
|
1,108,848
|
|
|
|
|
|
Redeemable
noncontrolling interest
|
|
3,997
|
|
55,645
|
|
|
|
|
|
Equity:
|
|
|
|
|
Common
stock
|
|
473
|
|
472
|
Additional
Paid in Capital
|
|
396,444
|
|
367,673
|
Treasury
stock
|
|
(592,306)
|
|
(593,164)
|
Accumulated other comprehensive income (loss)
|
|
(90,463)
|
|
(126,301)
|
Retained
earnings
|
|
906,518
|
|
911,233
|
Noncontrolling interest
|
|
16,876
|
|
18,192
|
Total
equity
|
|
637,542
|
|
578,105
|
|
|
|
|
|
Total liabilities and equity
|
|
$2,171,309
|
|
$ 2,153,962
|
TTEC HOLDINGS, INC. AND
SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
(In thousands)
|
(unaudited)
|
|
|
|
|
|
Six months ended
|
|
Six months ended
|
|
June 30,
|
|
June 30,
|
|
2023
|
|
2022
|
|
|
|
|
Cash flows from operating
activities:
|
|
|
|
Net income
|
$
24,674
|
|
$
66,768
|
Adjustment to reconcile net
income to net cash provided by operating activities :
|
|
|
|
Depreciation and amortization
|
50,773
|
|
52,944
|
Amortization of contract acquisition costs
|
1,158
|
|
1,063
|
Amortization of debt issuance costs
|
534
|
|
500
|
Imputed interest expense and fair value adjustments to contingent
consideration
|
6,762
|
|
-
|
Provision for credit losses
|
1,704
|
|
198
|
Loss on disposal of assets
|
856
|
|
1,116
|
Impairment losses
|
6,959
|
|
10,360
|
Loss on dissolution of subsidiary
|
301
|
|
-
|
Deferred income taxes
|
(10,390)
|
|
(9,161)
|
Excess tax benefit from equity-based awards
|
243
|
|
(913)
|
Equity-based compensation expense
|
9,802
|
|
7,882
|
Loss / (gain) on foreign currency derivatives
|
247
|
|
224
|
Changes in assets and liabilities, net of acquisitions:
|
|
|
|
Accounts receivable
|
14,645
|
|
(38,271)
|
Prepaids and other assets
|
20,324
|
|
35,866
|
Accounts payable and accrued expenses
|
43,429
|
|
21,041
|
Deferred revenue and other liabilities
|
(27,072)
|
|
(58,345)
|
Net cash provided by operating activities
|
144,949
|
|
91,272
|
|
|
|
|
Cash flows from investing
activities:
|
|
|
|
Proceeds from sale of
property, plant and equipment
|
28
|
|
102
|
Purchases of property, plant
and equipment
|
(32,954)
|
|
(35,790)
|
Acquisitions
|
-
|
|
(142,420)
|
Net cash used in investing activities
|
(32,926)
|
|
(178,108)
|
|
|
|
|
Cash flows from financing
activities:
|
|
|
|
Net proceeds / (borrowings)
from line of credit
|
(45,000)
|
|
139,000
|
Payments on other
debt
|
(1,217)
|
|
(1,877)
|
Payments of contingent
consideration and hold back payments to acquisitions
|
(37,676)
|
|
(9,600)
|
Dividends paid to
shareholders
|
(24,572)
|
|
(23,518)
|
Payments to noncontrolling
interest
|
(5,887)
|
|
(7,219)
|
Tax payments related to the
issuance of restricted stock units
|
(629)
|
|
(3,065)
|
Net cash (used in) / provided by financing activities
|
(114,981)
|
|
93,721
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents and restricted cash
|
1,275
|
|
(12,350)
|
|
|
|
|
Increase in cash, cash
equivalents and restricted cash
|
(1,683)
|
|
(5,465)
|
Cash, cash equivalents
and restricted cash, beginning of period
|
167,064
|
|
180,682
|
Cash, cash equivalents
and restricted cash, end of period
|
$
165,381
|
|
$
175,217
|
TTEC HOLDINGS, INC. AND
SUBSIDIARIES
|
|
|
|
RECONCILIATION OF NON-GAAP FINANCIAL
INFORMATION
|
|
|
|
(In thousands, except per share
data)
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
|
|
Six months ended
|
|
|
|
|
|
June 30,
|
|
|
|
|
June 30,
|
|
|
|
|
|
2023
|
|
2022
|
|
|
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$600,394
|
|
$604,250
|
|
|
|
|
$1,233,680
|
|
$1,192,976
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Income from Operations and
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from Operations
|
|
$
31,298
|
|
$
35,884
|
|
|
|
|
$ 75,709
|
|
$ 84,194
|
|
|
|
Restructuring charges,
net
|
|
1,474
|
|
2,528
|
|
|
|
|
3,527
|
|
3,148
|
|
|
|
Impairment
losses
|
|
2,652
|
|
9,248
|
|
|
|
|
6,959
|
|
10,360
|
|
|
|
Cybersecurity incident
related impact, net of insurance recovery
|
|
26
|
|
(167)
|
|
|
|
|
(3,210)
|
|
3,669
|
|
|
|
Grant income for
pandemic relief
|
|
40
|
|
-
|
|
|
|
|
40
|
|
-
|
|
|
|
Change in acquisition
related obligation
|
|
483
|
|
-
|
|
|
|
|
483
|
|
-
|
|
|
|
Equity-based
compensation expenses
|
|
5,648
|
|
4,143
|
|
|
|
|
9,802
|
|
7,882
|
|
|
|
Amortization of
purchased intangibles
|
|
9,007
|
|
9,554
|
|
|
|
|
18,010
|
|
19,090
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Income from Operations
|
|
$
50,628
|
|
$
61,190
|
|
|
|
|
$
111,320
|
|
$
128,343
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Income from Operations Margin
|
|
8.4 %
|
|
10.1 %
|
|
|
|
|
9.0 %
|
|
10.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
15,939
|
|
16,760
|
|
|
|
|
32,763
|
|
33,854
|
|
|
|
Changes in acquisition
contingent consideration
|
|
3,584
|
|
-
|
|
|
|
|
6,762
|
|
-
|
|
|
|
Change in escrow
balance related to acquisition
|
|
-
|
|
-
|
|
|
|
|
625
|
|
-
|
|
|
|
Loss on dissolution of
subsidiary
|
|
-
|
|
-
|
|
|
|
|
301
|
|
-
|
|
|
|
Foreign exchange loss
/ (gain), net
|
|
578
|
|
(3,473)
|
|
|
|
|
1,212
|
|
(4,516)
|
|
|
|
Other Income
(expense), net
|
|
(3,574)
|
|
6,111
|
|
|
|
|
(2,919)
|
|
7,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
67,155
|
|
$
80,588
|
|
|
|
|
$
150,064
|
|
$
165,052
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin
|
|
11.2 %
|
|
13.3 %
|
|
|
|
|
12.2 %
|
|
13.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
3,757
|
|
$
28,798
|
|
|
|
|
$ 24,674
|
|
$ 66,768
|
|
|
|
Add: Asset
impairment and restructuring charges
|
|
4,126
|
|
11,776
|
|
|
|
|
10,486
|
|
13,508
|
|
|
|
Add:
Equity-based compensation expenses
|
|
5,648
|
|
4,143
|
|
|
|
|
9,802
|
|
7,882
|
|
|
|
Add:
Amortization of purchased intangibles
|
|
9,007
|
|
9,554
|
|
|
|
|
18,010
|
|
19,090
|
|
|
|
Add:
Cybersecurity incident related impact, net of insurance
recovery
|
|
26
|
|
(167)
|
|
|
|
|
(3,210)
|
|
3,669
|
|
|
|
Add: Grant
income for pandemic relief
|
|
40
|
|
-
|
|
|
|
|
40
|
|
-
|
|
|
|
Add: Change in
acquisition related obligation
|
|
483
|
|
-
|
|
|
|
|
483
|
|
-
|
|
|
|
Add: Changes in
acquisition contingent consideration
|
|
3,584
|
|
-
|
|
|
|
|
6,762
|
|
-
|
|
|
|
Add: Changes in
escrow balance related to acquisition
|
|
-
|
|
-
|
|
|
|
|
625
|
|
-
|
|
|
|
Add: Loss on
dissolution of subsidiary
|
|
-
|
|
-
|
|
|
|
|
301
|
|
-
|
|
|
|
Add: Foreign
exchange loss / (gain), net
|
|
578
|
|
(3,473)
|
|
|
|
|
1,212
|
|
(4,516)
|
|
|
|
Less: Changes in
valuation allowance, return to provision adjustments
and other, and tax
effects of items separately disclosed above
|
|
(1,349)
|
|
(6,782)
|
|
|
|
|
(6,384)
|
|
(12,176)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income
|
|
$
25,900
|
|
$
43,849
|
|
|
|
|
$ 62,801
|
|
$ 94,225
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares outstanding
|
|
47,453
|
|
47,383
|
|
|
|
|
47,417
|
|
47,381
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP EPS
|
|
$0.55
|
|
$0.93
|
|
|
|
|
$1.32
|
|
$1.99
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Free Cash
Flow:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flow From Operating
Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
3,757
|
|
$
28,798
|
|
|
|
|
$ 24,674
|
|
$ 66,768
|
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
24,946
|
|
26,314
|
|
|
|
|
50,773
|
|
52,944
|
|
|
|
Other
|
|
67,188
|
|
22,474
|
|
|
|
|
69,502
|
|
(28,440)
|
|
|
|
Net cash
provided by operating activities
|
|
95,891
|
|
77,586
|
|
|
|
|
144,949
|
|
91,272
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less - Total Cash
Capital Expenditures
|
|
19,285
|
|
19,099
|
|
|
|
|
32,954
|
|
35,790
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash
Flow
|
|
$
76,606
|
|
$
58,487
|
|
|
|
|
$
111,995
|
|
$ 55,482
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Income from Operations and
Adjusted EBITDA by Segment :
|
|
|
|
|
|
|
|
|
|
|
|
|
TTEC Engage
|
|
TTEC Digital
|
|
TTEC Engage
|
|
TTEC Digital
|
|
|
Q2 23
|
|
Q2 22
|
|
Q2 23
|
Q2 22
|
|
YTD 23
|
|
YTD 22
|
|
YTD 23
|
YTD 22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from Operations
|
|
$
24,144
|
|
$
25,133
|
|
$
7,154
|
$10,751
|
|
$ 67,770
|
|
$ 67,238
|
|
$
7,939
|
$16,956
|
Restructuring charges,
net
|
|
801
|
|
2,415
|
|
673
|
113
|
|
1,793
|
|
3,035
|
|
1,734
|
113
|
Impairment
losses
|
|
2,652
|
|
9,248
|
|
-
|
-
|
|
4,105
|
|
10,360
|
|
2,854
|
-
|
Cybersecurity incident
related impact, net of insurance recovery
|
|
26
|
|
(167)
|
|
-
|
-
|
|
(3,210)
|
|
3,669
|
|
-
|
-
|
Grant income for
pandemic relief
|
|
40
|
|
-
|
|
-
|
-
|
|
40
|
|
-
|
|
-
|
-
|
Change in acquisition
related obligation
|
|
-
|
|
-
|
|
483
|
-
|
|
-
|
|
-
|
|
483
|
-
|
Equity-based
compensation expenses
|
|
3,596
|
|
2,834
|
|
2,052
|
1,309
|
|
6,272
|
|
5,286
|
|
3,530
|
2,596
|
Amortization of
purchased intangibles
|
|
4,652
|
|
4,784
|
|
4,355
|
4,770
|
|
9,302
|
|
7,999
|
|
8,708
|
11,091
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Income from Operations
|
|
$
35,911
|
|
$
44,247
|
|
$14,717
|
$16,943
|
|
$ 86,072
|
|
$ 97,587
|
|
$25,248
|
$30,756
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
13,572
|
|
13,696
|
|
2,367
|
3,064
|
|
27,888
|
|
27,700
|
|
4,875
|
6,154
|
Changes in acquisition
contingent consideration
|
|
3,584
|
|
-
|
|
-
|
-
|
|
6,762
|
|
-
|
|
-
|
-
|
Change in escrow
balance related to acquisition
|
|
-
|
|
-
|
|
-
|
-
|
|
625
|
|
-
|
|
-
|
-
|
Loss on dissolution of
subsidiary
|
|
-
|
|
-
|
|
-
|
-
|
|
301
|
|
-
|
|
-
|
-
|
Foreign exchange loss
/ (gain), net
|
|
411
|
|
(3,105)
|
|
167
|
(368)
|
|
1,112
|
|
(4,082)
|
|
100
|
(434)
|
Other Income
(expense), net
|
|
(3,422)
|
|
5,776
|
|
(152)
|
335
|
|
(2,910)
|
|
7,094
|
|
(9)
|
277
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
50,056
|
|
$
60,614
|
|
$17,099
|
$19,974
|
|
$
119,850
|
|
$
128,299
|
|
$30,214
|
$36,753
|
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SOURCE TTEC Holdings, Inc.