UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of November 2023

Commission File Number 001-36535

 

GLOBANT S.A.

(Translation of registrant's name into English)

 

 

37A, Avenue J.F. Kennedy

L-1855, Luxembourg

Tel: + 352 20 30 15 96

 

 (Address of principal executive office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F

or Form 40-F: x  Form 20-F ¨  Form 40-F
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(1): ____
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(7): ____
       

 

 

 

 

 

GLOBANT S.A.

FORM 6-K

 

Globant S.A. (the “Company”) is furnishing under the cover of Form 6-K the following:

 

Earnings Release

 

Exhibit 99.1 Press release, dated November 16, 2023, entitled “Globant Reports 2023 Third Quarter Financial Results.”

 

Incorporation by Reference

 

The unaudited condensed interim consolidated statements of comprehensive income, unaudited condensed interim consolidated statements of financial position, unaudited selected cash flow data, unaudited supplemental non-IFRS financial information and unaudited schedule of supplemental information contained in the press release attached as Exhibit 99.1 to this report on Form 6-K are hereby incorporated by reference into the Company’s registration statements on Form S-8 (File Nos. 333-201602, 333-211835, 333-232022, 333-255113 and 333-266204), to be a part thereof from the date on which this report is submitted, to the extent not superseded by documents or reports subsequently filed or furnished.

 

 

 

 

 

Signatures

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

  GLOBANT S.A.  
       
       
  By: /s/ JUAN URTHIAGUE  
    Name: Juan Urthiague  
    Title: Chief Financial Officer  

 

Date: November 16, 2023

 

 

 

Exhibit 99.1

 

November 16, 2023

 

Globant Reports 2023 Third Quarter Financial Results

Strong Sequential Improvement

 

Third quarter revenues of $545.3 million, up 18.8% year-over-year
IFRS Diluted EPS of $0.98 for the third quarter
Non-IFRS Adjusted Diluted EPS of $1.48 for the third quarter

 

LUXEMBOURG / November 16, 2023 - Globant (NYSE: GLOB), a digitally native technology services company, today announced results for the three and nine months ended September 30, 2023.

 

Please see highlights below, including certain Non-IFRS measures. Note that reconciliations between Non-IFRS financial measures and IFRS operating results are disclosed at the end of this press release.

 

Third Quarter 2023 Financial Highlights

 

Revenues rose to $545.3 million, representing 18.8% year-over-year growth.
IFRS Gross Profit Margin was 36.4% compared to 37.5% in the third quarter of 2022.
Non-IFRS Adjusted Gross Profit Margin was 38.2% compared to 39.1% in the third quarter of 2022.
IFRS Profit from Operations Margin was 9.7% compared to 11.3% in the third quarter of 2022.
Non-IFRS Adjusted Profit from Operations Margin was 15.3% compared to 16.1% in the third quarter of 2022.
IFRS Diluted EPS was $0.98 compared to $0.84 in the third quarter of 2022.
Non-IFRS Adjusted Diluted EPS was $1.48 compared to $1.27 in the third quarter of 2022.

 

Nine months ended September 30, 2023 Financial Highlights

 

Revenues rose to $1,515.2 million, representing 17.5% year-over-year growth.
IFRS Gross Profit Margin was 36.1% compared to 37.7% in the first nine months of 2022.
Non-IFRS Adjusted Gross Profit Margin was 38.2% compared to 39.2% in the first nine months of 2022.
IFRS Profit from Operations Margin was 9.5% compared to 11.8% in the first nine months of 2022.
Non-IFRS Adjusted Profit from Operations Margin was 15.1% compared to 16.3% in the first nine months of 2022.
IFRS Diluted EPS was $2.68 compared to $2.57 in the first nine months of 2022.
Non-IFRS Adjusted Diluted EPS was $4.12 compared to $3.69 in the first nine months of 2022.

 

 

 

 

Other Metrics as of and for the quarter ended September 30, 2023

Cash and cash equivalents and Short-term investments were $219.3 million as of September 30, 2023, a decrease of $121.6 million from $340.9 million as of December 31, 2022, driven mainly by investments in our platform business, expansion to new geographies, addition of new studios and acquisitions. As of September 30, 2023, we had a total amount of $50 million drawn from our credit facility.
Globant completed the third quarter of 2023 with 27,505 Globers, 25,575 of whom were technology, design and innovation professionals.
The geographic revenue breakdown for the third quarter of 2023 was as follows: 58.9% from North America (top country: US), 21.6% from Latin America (top country: Argentina), 16.5% from EMEA (top country: Spain) and 3.0% from Asia and Oceania (top country: India).
Globant’s top customer, top five customers and top ten customers for the third quarter of 2023 represented 8.7%, 22.5% and 32.2% of revenues, respectively.
During the twelve months ended September 30, 2023, Globant served a total of 1,544 customers (with revenues over $10,000 in the last twelve months) and continued to increase its wallet share, with 305 accounts generating more than $1 million of annual revenues, compared to 255 for the same period one year ago.
In terms of currencies, 72.5% of Globant’s revenues for the third quarter of 2023 were denominated in US dollars.

 

“Our revenue has surpassed $2 billion in the trailing 12 months for the first time, demonstrating market-leading growth in a challenging environment. This success is driven by the expansion of our offering, distinct culture, innovative models, and growing global presence that has established us as a leader in the IT industry. We have also seen remarkable progress in the adoption of generative AI and the recent advancements in our products such as the GeneXus Enterprise AI platform. Our delivery network, which has a strong footprint in Latin America, contributes to our talent growth and proximity to key markets,” said Martín Migoya, Globant's CEO and co-founder. “As we celebrate our 20th anniversary and look forward to our 10th year as an NYSE-listed company, we are optimistic about our robust pipeline and the future.”

 

“As we reflect on this quarter, I am thrilled to report that Globant has delivered another record-breaking performance, achieving $545.3 million in revenues—a testament to our robust year-over-year growth of 18.8%. Our strong third quarter results reflect positive performances across multiple facets of our business. We’ve experienced exceptional growth across all geographies, particularly in North America and EMEA, and in every single one of our industry verticals. We also generated strong quarter-over-quarter growth in many of our key clients and key cohorts. We believe that this is a reflection of the value we bring to our clients and the unique capabilities that Globant delivers to organizations across every industry and geography. At the same time, we maintained robust margins and delivered strong free cash-flow generation. Our journey of growth is just beginning, and the optimism within our organization is noticeable as we continue to advance as a market leader,” explained Juan Urthiague, Globant’s CFO.

 

 

 

 

2023 Fourth Quarter and Full Year Outlook

 

Based on current market conditions, Globant is providing the following estimates for the fourth quarter and the full year of 2023:

 

Fourth quarter 2023 Revenues are estimated to be at least $579.0 million, or 18.0% year-over-year growth.
Fourth quarter 2023 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 15-16%.
Fourth quarter 2023 Non-IFRS Adjusted Diluted EPS is estimated to be at least $1.60 (assuming an average of 43.9 million diluted shares outstanding during the fourth quarter).
Fiscal year 2023 Revenues are estimated to be at least $2,094.0 million, implying at least 17.6% year-over-year revenue growth.
Fiscal year 2023 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 15%-16%.
Fiscal year 2023 Non-IFRS Adjusted Diluted EPS is estimated to be at least $5.72 (assuming an average of 43.6 million diluted shares outstanding during 2023).

 

Conference Call and Webcast

 

Martin Migoya, Globant’s CEO & co-founder, Juan Urthiague, Globant’s CFO, Patricia Pomies, Globant’s COO, and Diego Tártara, Globant’s CTO, will discuss the third quarter 2023 results in a video conference call today beginning at 4:30pm ET.

 

Video conference call access information is:

https://more.globant.com/F3Q23EarningsCall

Webcast http://investors.globant.com/

 

About Globant (NYSE:GLOB)

 

We are a digitally native company that helps organizations reinvent themselves to create a way forward and unleash their potential. We are the place where innovation, design and engineering meet scale.

 

We have more than 27,500 employees and we are present in 30 countries across 5 continents working for companies like Google, Electronic Arts and Santander, among others.

 

We were named a Worldwide Leader in CX Improvement by IDC MarketScape report. We were also featured as a business case study at Harvard, MIT and Stanford. We are a member of the Cybersecurity Tech Accord.

 

For more information, please visit www.globant.com

 

Non-IFRS Financial Measures

 

While the financial figures included in this press release have been computed in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) applicable to interim periods, this announcement does not contain sufficient information to constitute an interim financial report as defined in International Accounting Standards 34, “Interim Financial Reporting” nor a financial statement as defined by International Accounting Standards 1 “Presentation of Financial Statements”. The financial information in this press release has not been audited.

 

 

 

 

Globant provides non-IFRS financial measures in addition to reported IFRS results prepared in accordance with IFRS. Management believes these measures help illustrate underlying trends in the companys business and uses the non-IFRS financial measures to establish budgets and operational goals, communicated internally and externally, for managing the companys business and evaluating its performance. The company anticipates that it will continue to report both IFRS and certain non-IFRS financial measures in its financial results, including non-IFRS measures that exclude share-based compensation expense, depreciation and amortization, acquisition-related charges, and the related effect on income taxes of the pre-tax adjustments. Because the companys non-IFRS financial measures are not calculated according to IFRS, these measures are not comparable to IFRS and may not necessarily be comparable to similarly described non-IFRS measures reported by other companies within the companys industry. Consequently, Globants non-IFRS financial measures should not be evaluated in isolation or supplant comparable IFRS measures, but, rather, should be considered together with its condensed interim consolidated statements of financial position as of September 30, 2023 and December 31, 2022 and its condensed interim consolidated statements of comprehensive income for the three and nine months ended September 30, 2023 and 2022, prepared in accordance with International Accounting Standard (“IAS”) 34, “Interim Financial Reporting”.

 

Globant is not providing a quantitative reconciliation of forward-looking Non-IFRS Adjusted Profit from Operations Margin or Non-IFRS Adjusted Diluted EPS to the most directly comparable IFRS 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, share-based compensation expense, impairment of assets, acquisition-related charges, and the tax effect of non-IFRS adjustments. These items are uncertain, depend on various factors, and could have a material impact on IFRS reported results for the guidance period.

 

Forward Looking Statements

 

In 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: our ability to maintain current resource utilization rates and productivity levels; our ability to manage attrition and attract and retain highly-skilled IT professionals; our ability to accurately price our client contracts; our ability to achieve our anticipated growth; our ability to effectively manage our rapid growth; our ability to retain our senior management team and other key employees; our ability to continue to innovate and remain at the forefront of emerging technologies and related market trends; our ability to retain our business relationships and client contracts; our ability to manage the impact of global adverse economic conditions; our ability to manage uncertainty concerning the instability in the current economic, political and social environment in Latin America; and other factors discussed under the heading “Risk Factors” in our most recent Form 20-F filed with the U.S. Securities and Exchange Commission and any other risk factors we include in subsequent reports on Form 6-K.

 

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.

 

 

 

 

Globant S.A.

Condensed Interim Consolidated Statements of Comprehensive Income

(In thousands of U.S. dollars, except per share amounts, unaudited)

 

   Nine Months Ended   Three Months Ended 
   September 30, 2023   September 30, 2022   September 30, 2023   September 30, 2022 
                 
Revenues   1,515,234    1,289,519    545,282    458,884 
Cost of revenues   (967,794)   (803,644)   (346,980)   (286,707)
Gross profit   547,440    485,875    198,302    172,177 
                     
Selling, general and administrative expenses   (390,064)   (332,524)   (142,531)   (119,208)
Net impairment losses on financial assets   (13,979)   (1,823)   (2,621)   (1,079)
Other operating income and expenses, net   614             
Profit from operations   144,011    151,528    53,150    51,890 
                     
Finance income   3,500    1,466    1,324    842 
Finance expense   (15,063)   (11,410)   (5,661)   (4,058)
Other financial results, net   11,473    (1,137)   3,044    (2,393)
Financial results, net   (90)   (11,081)   (1,293)   (5,609)
                     
Share of results of investment in associates   185    25    170    25 
Other income and expenses, net   4,075    2,019    2,774    (55)
Profit before income tax   148,181    142,491    54,801    46,251 
                     
Income tax   (31,067)   (32,430)   (10,978)   (10,151)
Net income for the period   117,114    110,061    43,823    36,100 
                     
Other comprehensive income, net of income tax effects                    
Items that may be reclassified subsequently to profit and loss:                    
- Exchange differences on translating foreign operations   (28,761)   (41,814)   (30,013)   (18,700)
- Net change in fair value on financial assets measured at FVOCI   (2,316)   (2,085)   15    7 
- Gains and losses on cash flow hedges   117    (6,218)   (3,762)   (2,007)
Total comprehensive income for the period   86,154    59,944    10,063    15,400 
                     
Net income attributable to:                    
Owners of the Company   116,405    109,706    42,993    35,991 
Non-controlling interest   709    355    830    109 
Net income for the period   117,114    110,061    43,823    36,100 
                     
Total comprehensive income for the period attributable to:                    
Owners of the Company   85,278    59,589    10,251    15,291 
Non-controlling interest   876    355    (188)   109 
Total comprehensive income for the period   86,154    59,944    10,063    15,400 
Earnings per share                    
Basic   2.74    2.62    1.01    0.86 
Diluted   2.68    2.57    0.98    0.84 
Weighted average of outstanding shares (in thousands)                    
Basic   42,474    41,853    42,696    41,982 
Diluted   43,442    42,763    43,664    42,891 

 

 

 

 

Globant S.A.

Condensed Interim Consolidated Statements of Financial Position as of September 30, 2023 and December 31, 2022

(In thousands of U.S. dollars, unaudited)

 

   September 30, 2023   December 31, 2022 
ASSETS          
Current assets          
Cash and cash equivalents   196,900    292,457 
Investments   22,410    48,408 
Trade receivables   509,116    424,810 
Other assets   16,013    15,197 
Other receivables   65,401    70,212 
Other financial assets   6,823    6,529 
Total current assets   816,663    857,613 
           
Non-current assets          
Investments   1,833    1,513 
Other assets   4,803    10,657 
Other receivables   20,599    16,316 
Deferred tax assets   58,047    46,807 
Investment in associates   1,522    1,337 
Other financial assets   31,603    34,978 
Property and equipment   160,636    161,733 
Intangible assets   196,748    182,572 
Right-of-use assets   124,095    147,311 
Goodwill   968,614    734,952 
Total non-current assets   1,568,500    1,338,176 
TOTAL ASSETS   2,385,163    2,195,789 
           
LIABILITIES          
Current liabilities          
Trade payables   80,819    89,397 
Payroll and social security taxes payable   204,314    203,819 
Borrowings   50,670    2,838 
Other financial liabilities   64,685    59,316 
Lease liabilities   37,586    37,681 
Tax liabilities   22,195    23,454 
Income tax payable   19,473    11,276 
Other liabilities   1,224    808 
Total current liabilities   480,966    428,589 
           
Non-current liabilities          
Trade payables   1,964    5,445 
Borrowings   2,789    861 
Other financial liabilities   53,595    78,055 
Lease liabilities   82,188    97,457 
Deferred tax liabilities   3,220    11,291 
Income tax payable   1,883     
Payroll and social security taxes payable   3,493    4,316 
Provisions for contingencies   12,439    13,615 
Total non-current liabilities   161,571    211,040 
TOTAL LIABILITIES   642,537    639,629 
           
Capital and reserves          
Issued capital   51,357    50,724 
Additional paid-in capital   1,052,368    950,520 
Other reserves   (63,369)   (32,242)
Retained earnings   654,956    538,551 
Total equity attributable to owners of the Company   1,695,312    1,507,553 
Non-controlling interests   47,314    48,607 
Total equity   1,742,626    1,556,160 
TOTAL EQUITY AND LIABILITIES   2,385,163    2,195,789 

 

 

 

 

Globant S.A.

Selected Cash Flow Data

(In thousands of U.S. dollars, unaudited)

 

   Three Months Ended 
   September 30, 2023   September 30, 2022 
Net Income for the period   43,823    36,100 
Non-cash adjustments, taxes and others   53,723    45,612 
Changes in working capital   (10,141)   (5,694)
Cash flows from operating activities   87,405    76,018 
Capital expenditures   (26,758)   (30,071)
Cash flows from investing activities   (140,663)   (95,419)
Cash flows from financing activities   7,931    (11,376)
Net decrease in cash & cash equivalents   (45,327)   (30,777)

 

 

 

 

 

Globant S.A.

Supplemental Non-IFRS Financial Information

(In thousands of U.S. dollars, unaudited)

 

   Nine Months Ended   Three Months Ended 
   September 30, 2023   September 30, 2022   September 30, 2023   September 30, 2022 
                 
Reconciliation of adjusted gross profit                    
Gross Profit   547,440    485,875    198,302    172,177 
Depreciation and amortization expense   20,612    16,757    7,579    5,957 
Share-based compensation expense - Equity settled   10,976    3,420    2,198    1,506 
Adjusted gross profit   579,028    506,052    208,079    179,640 
Adjusted gross profit margin   38.2%   39.2%   38.2%   39.1%
                     
Reconciliation of selling, general and administrative expenses                    
Selling, general and administrative expenses   (390,064)   (332,524)   (142,531)   (119,208)
Depreciation and amortization expense   61,501    44,863    21,012    15,930 
Share-based compensation expense - Equity settled   41,442    37,261    16,447    13,784 
Acquisition-related charges (a)   14,488    9,001    5,370    3,291 
Adjusted selling, general and administrative expenses   (272,633)   (241,399)   (99,702)   (86,203)
Adjusted selling, general and administrative expenses as % of revenues   (18.0)%   (18.7)%   (18.3)%   (18.8)%
                     
Reconciliation of Adjusted Profit from Operations                    
Profit from Operations   144,011    151,528    53,150    51,890 
Share-based compensation expense - Equity settled   52,418    40,681    18,645    15,290 
Acquisition-related charges (a)   32,577    18,188    11,435    6,473 
Adjusted Profit from Operations   229,006    210,397    83,230    73,653 
Adjusted Profit from Operations margin   15.1%   16.3%   15.3%   16.1%
                     
Reconciliation of Net income for the period                    
Net income for the period   116,405    109,706    42,993    35,991 
Share-based compensation expense - Equity settled   52,377    40,681    18,628    15,290 
Acquisition-related charges (a)   30,639    17,909    9,878    7,311 
Tax effect of non-IFRS adjustments   (20,380)   (10,709)   (6,720)   (3,942)
Adjusted Net income   179,041    157,587    64,779    54,650 
Adjusted Net income margin   11.8%   12.2%   11.9%   11.9%
                     
Calculation of Adjusted Diluted EPS                    
Adjusted Net income   179,041    157,587    64,779    54,650 
Diluted shares   43,442    42,763    43,664    42,891 
Adjusted Diluted EPS   4.12    3.69    1.48    1.27 

 

(a)Acquisition-related charges include, when applicable, amortization of purchased intangible assets included in depreciation and amortization expense line on our condensed interim consolidated statements of comprehensive income, interest charges on acquisition-related indebtedness, external deal costs, acquisition-related retention bonuses, integration costs, changes in the fair value of contingent consideration liabilities, charges for impairment of acquired intangible assets and other acquisition-related costs. We cannot provide acquisition-related charges on a forward-looking basis without unreasonable effort as such charges may fluctuate based on the timing, size, and complexity of future acquisitions as well as other uncertainty inherent in mergers and acquisitions.

 

 

 

 

Globant S.A.

Schedule of Supplemental Information (unaudited)

 

Metrics Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023
           
Total Employees 26,541 27,122 26,288 25,947 27,505
IT Professionals 24,922 25,331 24,496 24,163 25,575
           
North America Revenues % 64.9 61.7 61.4 60.6 58.9
Latin America Revenues % 21.9 22.7 21.8 22.0 21.6
EMEA Revenues % 10.0 11.9 13.4 14.1 16.5
Asia and Oceania Revenues % 3.2 3.7 3.4 3.3 3.0
           
USD Revenues % 81.2 77.5 74.8 73.9 72.5
Other Currencies Revenues % 18.8 22.5 25.2 26.1 27.5
           
Top Customer % 10.7 10.8 9.4 8.8 8.7
Top 5 Customers % 24.7 25.1 24.5 23.7 22.5
Top 10 Customers % 34.5 34.3 34.8 33.3 32.2
           
Customers Served (Last Twelve Months)* 1,114 1,249 1,342 1,388 1,544
Customers with >$1M in Revenues (Last Twelve Months) 255 259 276 283 305

 

(*) Represents customers with more than $10,000 in revenues in the last twelve months.

 

Investor Relations Contact:

Arturo Langa, Globant

investors@globant.com

+1 (877) 215-5230

 

Media Contact:

Wanda Weigert, Globant

pr@globant.com

+1 (877) 215-5230

Source: Globant

 

 

 


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