Concentrix Corporation (NASDAQ: CNXC), a global technology and
services leader, today announced financial results for the fiscal
second quarter ended May 31, 2024.
| |
Three Months Ended |
|
|
| |
May 31, 2024 |
|
May 31, 2023 |
|
Change |
|
Revenue ($M) |
$ |
2,380.7 |
|
|
$ |
1,614.7 |
|
|
47.4 |
% |
| Operating income ($M) |
$ |
150.2 |
|
|
$ |
162.6 |
|
|
(7.6)% |
| Non-GAAP operating income ($M)
(1) |
$ |
321.1 |
|
|
$ |
220.6 |
|
|
45.6 |
% |
| Operating margin |
|
6.3 |
% |
|
|
10.1 |
% |
|
-380 bps |
| Non-GAAP operating margin
(1) |
|
13.5 |
% |
|
|
13.7 |
% |
|
-20 bps |
| Net income ($M) |
$ |
66.8 |
|
|
$ |
78.9 |
|
|
(15.3)% |
| Non-GAAP net income ($M) (1),
(2) |
$ |
183.1 |
|
|
$ |
137.6 |
|
|
33.1 |
% |
| Adjusted EBITDA ($M) (1) |
$ |
379.6 |
|
|
$ |
258.8 |
|
|
46.7 |
% |
| Adjusted EBITDA margin
(1) |
|
15.9 |
% |
|
|
16.0 |
% |
|
-10 bps |
| Diluted earnings per common
share |
$ |
0.98 |
|
|
$ |
1.51 |
|
|
(35.1)% |
| Non-GAAP diluted earnings per
common share (1), (2) |
$ |
2.69 |
|
|
$ |
2.63 |
|
|
2.3 |
% |
| |
|
|
|
|
|
|
|
|
|
|
(1) See non-GAAP reconciliations included in the accompanying
financial tables for the reconciliation of each non-GAAP measure to
its most directly comparable GAAP measure.(2) As described in the
non-GAAP reconciliations included in the accompanying financial
tables, the reported amounts for non-GAAP net income and non-GAAP
EPS for all periods include adjustments to exclude foreign currency
losses (gains), net, which were not adjusted in similar non-GAAP
measures previously reported.
Second Quarter Fiscal
2024 Highlights:
- Revenue of $2,380.7 million, an increase of 47.4% year-on-year
compared to revenue of $1,614.7 million in the prior year second
quarter. The Company grew revenue 4.0% year-on-year on a pro forma
constant currency basis.
- Operating income of $150.2 million, or 6.3% of revenue,
compared to $162.6 million, or 10.1% of revenue, in the prior year
second quarter, a reduction year-on-year primarily due to increased
amortization of intangibles and planned integration expenses
associated with the Company's combination with Webhelp, which
closed in the fourth quarter of 2023.
- Non-GAAP operating income of $321.1 million, or 13.5% of
revenue, compared to $220.6 million, or 13.7% of revenue in the
prior year second quarter.
- Adjusted EBITDA of $379.6 million, or 15.9% of revenue,
compared with $258.8 million, or 16.0% of revenue in the prior year
second quarter.
- Cash flow from operations was $238.3 million in the quarter.
Adjusted free cash flow was $201.9 million in the quarter.
- Diluted earnings per common share (“EPS”) was $0.98 compared to
$1.51 in the prior year second quarter. The decrease was primarily
due to increased amortization of intangibles and planned
integration expenses associated with the Company's combination with
Webhelp, which closed in the fourth quarter of 2023.
- Non-GAAP diluted EPS was $2.69 compared to $2.63 in the prior
year second quarter.
“Our second quarter marked yet another quarter of above-market
revenue growth, indicating the strength of our differentiated
technology and services offerings. Our pipeline of AI and
technology-led solutions remains solid, our Webhelp integration is
on track, and we continue to see a stable demand environment,” said
Chris Caldwell, President and CEO of Concentrix. “With this
positive momentum we are increasing our revenue guidance and
reaffirming our outlook for adjusted free cash flow for 2024, while
accelerating our investments in our technology to extend our value
to our clients and increase market share.”
Quarterly Dividend and Share Repurchase
Program:
- The Company paid a $0.3025 per share quarterly dividend on May
7, 2024. The Company’s Board of Directors has declared a quarterly
dividend of $0.3025 per share payable on August 6, 2024, to
shareholders of record at the close of business on July 26,
2024.
- The Company repurchased 0.7 million shares in the second
quarter at a cost of $40.3 million under its previously announced
share repurchase program at an average cost of $61.12 per share. At
May 31, 2024, the Company’s remaining share repurchase
authorization was $227.2 million.
Business OutlookThe following statements are
based on the Company’s current expectations for the third quarter
of fiscal 2024 and the full year fiscal 2024. Non-GAAP financial
measures exclude the impact of acquisition-related and integration
expenses, amortization of intangible assets, depreciation,
share-based compensation, and the related tax effects thereon. The
non-GAAP EPS guidance assumes no impact from changes in acquisition
contingent consideration and foreign currency losses (gains), net
included in other expense (income), net. These statements are
forward-looking and actual results may differ materially.
Third Quarter Fiscal 2024 Expectations:
- Third quarter reported revenue of $2.350 billion to $2.400
billion. Based on current exchange rates, these expectations assume
an approximately 205-basis point negative impact of foreign
exchange rates compared with the prior year period. The guidance
implies pro forma constant currency revenue growth for the third
quarter of 1.5% to 3.5%.
- Operating income of $172 million to $181 million and non-GAAP
operating income of $330 million to $350 million.
- Non-GAAP EPS of $2.76 to $3.04, assuming approximately 64.8
million diluted common shares outstanding and approximately 4% of
net income attributable to participating securities.
- The effective tax rate is expected to be approximately 25% to
26%.
Full Year Fiscal 2024 Expectations:
- Full year reported revenue of $9.580 billion to $9.675 billion.
Based on current exchange rates, the expectations assume an
approximately 150-basis point negative impact of foreign exchange
rates compared with the prior year. The guidance implies pro forma
constant currency revenue growth for the full year of 2.5% to
3.5%.
- Operating income of $696 million to $724 million and non-GAAP
operating income of $1,350 million to $1,400 million.
- Non-GAAP EPS of $11.40 to $12.07, assuming approximately 65.1
million diluted common shares outstanding and approximately 4% of
net income attributable to participating securities.
- The effective tax rate is expected to be approximately 25% to
25.5%.
The Company also confirmed its outlook for adjusted free cash
flow of $700 million for fiscal 2024 and expects to repurchase
approximately $60 million of its common stock over the final two
quarters of the year for total share repurchases of $120 million
for fiscal 2024.
The Company believes that a quantitative reconciliation of the
non-GAAP EPS outlook to the most directly comparable GAAP measures
cannot be provided without unreasonable efforts due to (a) the
inability to forecast future changes in acquisition contingent
consideration, which is based, in part, on the future trading price
of the Company’s common stock, and (b) the inability to forecast
future foreign currency losses (gains), net included in other
expense (income), net. For the same reason, the Company is unable
to address the probable significance of the unavailable
information, which may have a material impact on the Company’s GAAP
results.
The Company believes that a quantitative reconciliation of the
adjusted free cash flow outlook to the most directly comparable
GAAP measure cannot be provided without unreasonable efforts due to
uncertainty related to the future changes in the Company’s
factoring program and related timing of those changes. For the same
reason, the Company is unable to address the probable significance
of the unavailable information, which may have a material impact on
the Company’s GAAP results.
Conference Call and WebcastThe Company will
host a conference call for investors to review its second quarter
fiscal 2024 results today at 5:00 p.m. (ET)/2:00 p.m. (PT).
The live conference call webcast will be available in
listen-only mode in the Investor Relations section of the Company’s
website under “Events and Presentations” at
https://ir.concentrix.com/events-and-presentations. A replay will
also be available on the website following the conference call.
About us: Experience the power of
ConcentrixConcentrix Corporation (NASDAQ: CNXC), a Fortune
500® company, is the global technology and services leader that
powers the world’s best brands, today and into the future. We’re
human-centered, tech-powered, intelligence-fueled. Every day, we
design, build, and run fully integrated, end-to-end solutions at
speed and scale across the entire enterprise, helping over 2,000
clients solve their toughest business challenges. Whether it’s
designing game-changing brand experiences, building and scaling
secure AI technologies, or running digital operations that deliver
global consistency with a local touch, we have it covered. At the
heart of everything we do lies a commitment to transforming the way
companies connect, interact, and grow. We’re here to redefine what
success means, delivering outcomes unimagined across every major
vertical in 70+ markets. Virtually everywhere. Visit concentrix.com
to learn more.
Use of Non-GAAP InformationIn addition to
disclosing financial results that are determined in accordance with
GAAP, we also disclose certain non-GAAP financial information,
including:
- Constant currency revenue growth, which is revenue growth
adjusted for the translation effect of foreign currencies so that
certain financial results can be viewed without the impact of
fluctuations in foreign currency exchange rates, thereby
facilitating period-to-period comparisons of our business
performance. Constant currency revenue growth is calculated by
translating the revenue of each fiscal year in the billing currency
to U.S. dollars using the comparable prior year’s currency
conversion rate in comparison to prior year’s revenue. Generally,
when the U.S. dollar either strengthens or weakens against other
currencies, revenue growth at constant currency rates or adjusting
for currency will be higher or lower than revenue growth reported
at actual exchange rates.
- Pro forma constant currency revenue growth, which is constant
currency revenue growth measured against the Company’s combined pro
forma results of operations as if the combination with Webhelp had
occurred on December 1, 2022.
- Non-GAAP operating income, which is operating income, adjusted
to exclude acquisition-related and integration expenses, including
related restructuring costs, step-up depreciation, amortization of
intangible assets, and share-based compensation.
- Non-GAAP operating margin, which is non-GAAP operating income,
as defined above, divided by revenue.
- Adjusted earnings before interest, taxes, depreciation, and
amortization, or adjusted EBITDA, which is non-GAAP operating
income, as defined above, plus depreciation (exclusive of step-up
depreciation).
- Adjusted EBITDA margin, which is adjusted EBITDA, as defined
above, divided by revenue.
- Non-GAAP net income, which is net income excluding the
tax-effected impact of acquisition-related and integration
expenses, including related restructuring costs, step-up
depreciation, amortization of intangible assets, share-based
compensation, imputed interest related to the sellers’ note, change
in acquisition contingent consideration and foreign currency losses
(gains), net.
- Free cash flow, which is cash flows from operating activities
less capital expenditures, and adjusted free cash flow, which is
free cash flow excluding the effect of changes in the outstanding
factoring balance. We believe that free cash flow is a meaningful
measure of cash flows since capital expenditures are a necessary
component of ongoing operations. We believe that adjusted free cash
flow is a meaningful measure of cash flows because it removes the
effect of factoring which changes the timing of the receipt of cash
for certain receivables. However, free cash flow and adjusted free
cash flow have limitations because they do not represent the
residual cash flow available for discretionary expenditures. For
example, free cash flow and adjusted free cash flow do not
incorporate payments for business acquisitions.
- Non-GAAP diluted EPS, which is diluted EPS excluding the per
share, tax-effected impact of acquisition-related and integration
expenses, including related restructuring costs, step-up
depreciation, amortization of intangible assets, share-based
compensation, imputed interest related to the sellers’ note, change
in acquisition contingent consideration and foreign currency losses
(gains), net. Non-GAAP EPS excludes net income attributable to
participating securities and the related per share, tax-effected
impact of adjustments to net income described above reflect only
those amounts that are attributable to common shareholders.
We believe that providing this additional information is useful
to the reader to better assess and understand our base operating
performance, especially when comparing results with previous
periods and for planning and forecasting in future periods,
primarily because management typically monitors the business
adjusted for these items in addition to GAAP results. Management
also uses these non-GAAP measures to establish operational goals
and, in some cases, for measuring performance for compensation
purposes. These non-GAAP financial measures exclude amortization of
intangible assets. Although intangible assets contribute to our
revenue generation, the amortization of intangible assets does not
directly relate to the services performed for our clients.
Additionally, intangible asset amortization expense typically
fluctuates based on the size and timing of our acquisition
activity. Accordingly, we believe excluding the amortization of
intangible assets, along with the other non-GAAP adjustments, which
neither relate to the ordinary course of our business nor reflect
our underlying business performance, enhances our and our
investors’ ability to compare our past financial performance with
its current performance and to analyze underlying business
performance and trends. These non-GAAP financial measures also
exclude share-based compensation expense. Given the subjective
assumptions and the variety of award types that companies can use
when calculating share-based compensation expense, management
believes this additional information allows investors to make
additional comparisons between our operating results and those of
our peers. As these non-GAAP financial measures are not calculated
in accordance with GAAP, they may not necessarily be comparable to
similarly titled measures employed by other companies. These
non-GAAP financial measures should not be considered in isolation
or as a substitute for the comparable GAAP measures and should be
used as a complement to, and in conjunction with, data presented in
accordance with GAAP.
Safe Harbor StatementThis news release includes
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements include, but are not limited to, statements regarding
the Company’s expected future financial condition and growth,
results of operations, including revenue and operating income, cash
flows, and effective tax rate, future growth and success,
investments, share repurchase activity, capital allocation, debt
repayment, business strategy, foreign currency exchange rate
fluctuations, sales pipeline, and statements that include words
such as believe, expect, may, will, provide, could, should and
other similar expressions. These forward-looking statements are
inherently uncertain and involve substantial risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied by such statements. Risks and
uncertainties include, among other things: risks related to the
Company’s ability to realize estimated cost savings, synergies or
other anticipated benefits of the combination with Webhelp, or that
such benefits may take longer to realize than expected; risks
related to general economic conditions, including consumer demand,
interest rates, inflation, supply chains and the effects of the
conflicts in Ukraine and Gaza; cyberattacks on the Company’s or its
clients’ networks and information technology systems; uncertainty
around, and disruption from, new and emerging technologies,
including the adoption and utilization of generative artificial
intelligence; the failure of the Company’s staff and contractors to
adhere to the Company’s and its clients’ controls and processes;
the inability to protect personal and proprietary information; the
effects of communicable diseases or other public health crises,
natural disasters and adverse weather conditions; geopolitical,
economic and climate- or weather-related risks in regions with a
significant concentration of the Company’s operations; the
inability to execute on the Company’s strategy; competitive
conditions in the Company’s industry and consolidation of its
competitors; variability in demand by the Company’s clients or the
early termination of the Company’s client contracts; the level of
business activity of the Company’s clients and the market
acceptance and performance of their products and services; the
demand for CX solutions and technology; damage to the Company’s
reputation through the actions or inactions of third parties;
changes in law, regulations or regulatory guidance; the operability
of the Company’s communication services and information technology
systems and networks; the loss of key personnel or the inability to
attract and retain staff with the skills and expertise needed for
the Company’s business; increases in the cost of labor; the
inability to successfully identify, complete, and integrate
strategic acquisitions or investments; higher than expected tax
liabilities; currency exchange rate fluctuations; investigative or
legal actions; and other factors contained in the Company’s Annual
Report on Form 10-K for the fiscal year ended November 30, 2023
filed with the Securities and Exchange Commission and subsequent
SEC filings. The Company does not undertake a duty to update
forward-looking statements, which speak only as of the date on
which they are made.
Copyright 2024 Concentrix Corporation. All
rights reserved. Concentrix, the Concentrix logo, and all other
Concentrix company, product and services names and slogans are
trademarks or registered trademarks of Concentrix Corporation and
its subsidiaries. Concentrix and the Concentrix logo Reg. U.S. Pat.
& Tm. Off. and applicable non-U.S. jurisdictions. Other names
and marks are the property of their respective owners.
From Fortune ©2024 Fortune Media IP Limited. All rights
reserved. Used under license. Fortune and Fortune 500 are
registered trademarks of Fortune Media IP Limited and are used
under license. Fortune and Fortune Media IP Limited are not
affiliated with, and do not endorse the products or services of
Concentrix.
Investor Contact:Sara
BudaInvestor RelationsConcentrix
Corporationsara.buda@concentrix.com (617) 331-0955
CONCENTRIX
CORPORATIONCONSOLIDATED BALANCE
SHEETS(currency and share amounts in thousands,
except par value)
| |
May 31, 2024 |
|
November 30, 2023 |
| |
(unaudited) |
|
|
| ASSETS |
|
|
|
| Current assets: |
|
|
|
|
Cash and cash equivalents |
$ |
207,340 |
|
|
$ |
295,336 |
|
|
Accounts receivable, net |
|
1,871,560 |
|
|
|
1,888,890 |
|
|
Other current assets |
|
637,284 |
|
|
|
674,423 |
|
|
Total current assets |
|
2,716,184 |
|
|
|
2,858,649 |
|
| Property and equipment,
net |
|
727,654 |
|
|
|
748,691 |
|
| Goodwill |
|
5,026,032 |
|
|
|
5,078,668 |
|
| Intangible assets, net |
|
2,564,317 |
|
|
|
2,804,965 |
|
| Deferred tax assets |
|
112,043 |
|
|
|
72,333 |
|
| Other assets |
|
932,581 |
|
|
|
928,521 |
|
|
Total assets |
$ |
12,078,811 |
|
|
$ |
12,491,827 |
|
| |
|
|
|
| LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
| Current liabilities: |
|
|
|
|
Accounts payable |
$ |
201,525 |
|
|
$ |
243,565 |
|
|
Current portion of long-term debt |
|
1,590 |
|
|
|
2,313 |
|
|
Accrued compensation and benefits |
|
589,154 |
|
|
|
731,172 |
|
|
Other accrued liabilities |
|
935,537 |
|
|
|
1,016,406 |
|
|
Income taxes payable |
|
38,517 |
|
|
|
80,583 |
|
|
Total current liabilities |
|
1,766,323 |
|
|
|
2,074,039 |
|
| Long-term debt, net |
|
4,923,879 |
|
|
|
4,939,712 |
|
| Other long-term
liabilities |
|
918,898 |
|
|
|
920,536 |
|
| Deferred tax liabilities |
|
386,288 |
|
|
|
414,246 |
|
|
Total liabilities |
|
7,995,388 |
|
|
|
8,348,533 |
|
| Stockholders’ equity: |
|
|
|
|
Preferred stock, $0.0001 par value, 10,000 shares authorized and no
shares issued and outstanding as of May 31, 2024 and November 30,
2023, respectively |
|
— |
|
|
|
— |
|
|
Common stock, $0.0001 par value, 250,000 shares authorized; 68,007
and 67,883 shares issued as of May 31, 2024 and November 30, 2023,
respectively, and 64,933 and 65,734 shares outstanding as of May
31, 2024 and November 30, 2023, respectively |
|
7 |
|
|
|
7 |
|
|
Additional paid-in capital |
|
3,627,559 |
|
|
|
3,582,521 |
|
|
Treasury stock, 3,074 and 2,149 shares as of May 31, 2024 and
November 30, 2023, respectively |
|
(336,486 |
) |
|
|
(271,968 |
) |
|
Retained earnings |
|
1,102,438 |
|
|
|
1,024,461 |
|
|
Accumulated other comprehensive loss |
|
(310,095 |
) |
|
|
(191,727 |
) |
|
Total stockholders’ equity |
|
4,083,423 |
|
|
|
4,143,294 |
|
|
Total liabilities and stockholders’ equity |
$ |
12,078,811 |
|
|
$ |
12,491,827 |
|
|
|
|
|
|
|
|
|
|
CONCENTRIX
CORPORATIONCONSOLIDATED STATEMENTS OF
OPERATIONS(currency and share amounts in
thousands, except per share
amounts)(unaudited)
| |
Three Months Ended |
|
|
|
Six Months Ended |
|
|
| |
May 31, 2024 |
|
May 31, 2023 |
|
% Change |
|
May 31, 2024 |
|
May 31, 2023 |
|
% Change |
| Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
Technology and consumer electronics |
$ |
658,268 |
|
|
$ |
504,204 |
|
31 |
% |
|
$ |
1,323,370 |
|
|
$ |
1,020,812 |
|
30 |
% |
|
Retail, travel and ecommerce |
|
568,081 |
|
|
|
307,952 |
|
84 |
% |
|
|
1,151,793 |
|
|
|
613,456 |
|
88 |
% |
|
Communications and media |
|
381,253 |
|
|
|
257,794 |
|
48 |
% |
|
|
761,418 |
|
|
|
514,781 |
|
48 |
% |
|
Banking, financial services and insurance |
|
377,723 |
|
|
|
261,964 |
|
44 |
% |
|
|
743,145 |
|
|
|
521,617 |
|
42 |
% |
|
Healthcare |
|
176,673 |
|
|
|
164,708 |
|
7 |
% |
|
|
367,762 |
|
|
|
342,532 |
|
7 |
% |
|
Other |
|
218,718 |
|
|
|
118,084 |
|
85 |
% |
|
|
435,976 |
|
|
|
237,912 |
|
83 |
% |
| Total revenue |
$ |
2,380,716 |
|
|
$ |
1,614,706 |
|
47 |
% |
|
$ |
4,783,464 |
|
|
$ |
3,251,110 |
|
47 |
% |
| Cost of revenue |
|
1,523,147 |
|
|
|
1,034,481 |
|
47 |
% |
|
|
3,069,366 |
|
|
|
2,089,724 |
|
47 |
% |
| Gross profit |
|
857,569 |
|
|
|
580,225 |
|
48 |
% |
|
|
1,714,098 |
|
|
|
1,161,386 |
|
48 |
% |
| Selling, general and
administrative expenses |
|
707,399 |
|
|
|
417,659 |
|
69 |
% |
|
|
1,415,489 |
|
|
|
842,773 |
|
68 |
% |
| Operating income |
|
150,170 |
|
|
|
162,566 |
|
(8)% |
|
|
298,609 |
|
|
|
318,613 |
|
(6)% |
| Interest expense and finance
charges, net |
|
82,457 |
|
|
|
47,213 |
|
75 |
% |
|
|
164,896 |
|
|
|
81,203 |
|
103 |
% |
| Other expense (income),
net |
|
(19,415 |
) |
|
|
9,383 |
|
(307)% |
|
|
(26,239 |
) |
|
|
13,097 |
|
(300)% |
| Income before income
taxes |
|
87,128 |
|
|
|
105,970 |
|
(18)% |
|
|
159,952 |
|
|
|
224,313 |
|
(29)% |
| Provision for income
taxes |
|
20,294 |
|
|
|
27,120 |
|
(25)% |
|
|
41,016 |
|
|
|
57,593 |
|
(29)% |
| Net income |
$ |
66,834 |
|
|
$ |
78,850 |
|
(15)% |
|
$ |
118,936 |
|
|
$ |
166,720 |
|
(29)% |
| |
|
|
|
|
|
|
|
|
|
|
|
| Earnings per common
share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.98 |
|
|
$ |
1.51 |
|
|
|
$ |
1.75 |
|
|
$ |
3.20 |
|
|
|
Diluted |
$ |
0.98 |
|
|
$ |
1.51 |
|
|
|
$ |
1.74 |
|
|
$ |
3.18 |
|
|
| Weighted-average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
65,270 |
|
|
|
51,181 |
|
|
|
|
65,466 |
|
|
|
51,165 |
|
|
|
Diluted |
|
65,332 |
|
|
|
51,392 |
|
|
|
|
65,570 |
|
|
|
51,457 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONCENTRIX
CORPORATIONRECONCILIATION OF GAAP TO NON-GAAP
MEASURES(currency and share amounts in thousands,
except per share amounts)(unaudited)
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2024 |
|
Revenue |
$ |
2,380,716 |
|
|
$ |
4,783,464 |
|
|
Pro forma revenue growth |
|
1.8 |
% |
|
|
1.8 |
% |
|
Foreign exchange impact |
|
2.2 |
% |
|
|
1.6 |
% |
| Pro forma constant currency
revenue growth |
|
4.0 |
% |
|
|
3.4 |
% |
| |
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2023 |
|
May 31, 2024 |
|
May 31, 2023 |
|
Operating income |
$ |
150,170 |
|
$ |
162,566 |
|
$ |
298,609 |
|
$ |
318,613 |
|
Acquisition-related and integration expenses |
|
30,906 |
|
|
7,433 |
|
|
61,079 |
|
|
12,976 |
|
Step-up depreciation |
|
2,482 |
|
|
— |
|
|
4,983 |
|
|
— |
|
Amortization of intangibles |
|
115,969 |
|
|
39,426 |
|
|
232,271 |
|
|
78,686 |
|
Share-based compensation |
|
21,618 |
|
|
11,189 |
|
|
43,264 |
|
|
27,943 |
| Non-GAAP operating income |
$ |
321,145 |
|
$ |
220,614 |
|
$ |
640,206 |
|
$ |
438,218 |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2023 |
|
May 31, 2024 |
|
May 31, 2023 |
|
Net income |
$ |
66,834 |
|
|
$ |
78,850 |
|
$ |
118,936 |
|
|
$ |
166,720 |
|
Interest expense and finance charges, net |
|
82,457 |
|
|
|
47,213 |
|
|
164,896 |
|
|
|
81,203 |
|
Provision for income taxes |
|
20,294 |
|
|
|
27,120 |
|
|
41,016 |
|
|
|
57,593 |
|
Other expense (income), net |
|
(19,415 |
) |
|
|
9,383 |
|
|
(26,239 |
) |
|
|
13,097 |
|
Acquisition-related and integration expenses |
|
30,906 |
|
|
|
7,433 |
|
|
61,079 |
|
|
|
12,976 |
|
Step-up depreciation |
|
2,482 |
|
|
|
— |
|
|
4,983 |
|
|
|
— |
|
Amortization of intangibles |
|
115,969 |
|
|
|
39,426 |
|
|
232,271 |
|
|
|
78,686 |
|
Share-based compensation |
|
21,618 |
|
|
|
11,189 |
|
|
43,264 |
|
|
|
27,943 |
|
Depreciation (exclusive of step-up depreciation) |
|
58,492 |
|
|
|
38,211 |
|
|
123,749 |
|
|
|
76,386 |
| Adjusted EBITDA |
$ |
379,637 |
|
|
$ |
258,825 |
|
$ |
763,955 |
|
|
$ |
514,604 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2023 |
|
May 31, 2024 |
|
May 31, 2023 |
|
Operating margin |
6.3 |
% |
|
10.1 |
% |
|
6.2 |
% |
|
9.8 |
% |
| Non-GAAP operating margin |
13.5 |
% |
|
13.7 |
% |
|
13.4 |
% |
|
13.5 |
% |
| Adjusted EBITDA margin |
15.9 |
% |
|
16.0 |
% |
|
16.0 |
% |
|
15.8 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2023 |
|
May 31, 2024 |
|
May 31, 2023 |
|
Net income |
$ |
66,834 |
|
|
$ |
78,850 |
|
|
$ |
118,936 |
|
|
$ |
166,720 |
|
|
Acquisition-related and integration expenses |
|
30,906 |
|
|
|
7,433 |
|
|
|
61,079 |
|
|
|
12,976 |
|
|
Step-up depreciation |
|
2,482 |
|
|
|
— |
|
|
|
4,983 |
|
|
|
— |
|
|
Acquisition-related expenses included in interest expense and
finance charges, net (1) |
|
— |
|
|
|
11,840 |
|
|
|
— |
|
|
|
11,840 |
|
|
Acquisition-related expenses included in other expense (income),
net (1) |
|
— |
|
|
|
12,429 |
|
|
|
— |
|
|
|
12,429 |
|
|
Imputed interest related to sellers’ note included in interest
expense and finance charges, net |
|
4,179 |
|
|
|
— |
|
|
|
8,357 |
|
|
|
— |
|
|
Change in acquisition contingent consideration included in other
expense (income), net |
|
(6,689 |
) |
|
|
— |
|
|
|
(21,586 |
) |
|
|
— |
|
|
Foreign currency losses (gains), net (4) |
|
(14,409 |
) |
|
|
(3,954 |
) |
|
|
(7,799 |
) |
|
|
(1,452 |
) |
|
Amortization of intangibles |
|
115,969 |
|
|
|
39,426 |
|
|
|
232,271 |
|
|
|
78,686 |
|
|
Share-based compensation |
|
21,618 |
|
|
|
11,189 |
|
|
|
43,264 |
|
|
|
27,943 |
|
|
Income taxes related to the above (2) |
|
(37,791 |
) |
|
|
(19,591 |
) |
|
|
(78,695 |
) |
|
|
(35,606 |
) |
| Non-GAAP net income |
$ |
183,099 |
|
|
$ |
137,622 |
|
|
$ |
360,810 |
|
|
$ |
273,536 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2023 |
|
May 31, 2024 |
|
May 31, 2023 |
|
Net income |
$ |
66,834 |
|
|
$ |
78,850 |
|
|
$ |
118,936 |
|
|
$ |
166,720 |
|
|
Less: net income allocated to participating securities |
|
(2,571 |
) |
|
|
(1,357 |
) |
|
|
(4,568 |
) |
|
|
(2,900 |
) |
| Net income attributable to
common stockholders |
|
64,263 |
|
|
|
77,493 |
|
|
|
114,368 |
|
|
|
163,820 |
|
|
Acquisition-related and integration expenses allocated to common
stockholders |
|
29,717 |
|
|
|
7,305 |
|
|
|
58,733 |
|
|
|
12,750 |
|
|
Step-up depreciation allocated to common stockholders |
|
2,387 |
|
|
|
— |
|
|
|
4,792 |
|
|
|
— |
|
|
Acquisition-related expenses included in interest expense and
finance charges, net allocated to common stockholders (1) |
|
— |
|
|
|
11,636 |
|
|
|
— |
|
|
|
11,634 |
|
|
Acquisition-related expenses included in other expense (income),
net allocated to common stockholders (1) |
|
— |
|
|
|
12,215 |
|
|
|
— |
|
|
|
12,213 |
|
|
Imputed interest related to sellers' note included in interest
expense and finance charges, net allocated to common
stockholders |
|
4,018 |
|
|
|
— |
|
|
|
8,036 |
|
|
|
— |
|
|
Change in acquisition contingent consideration included in other
expense (income), net allocated to common stockholders |
|
(6,432 |
) |
|
|
— |
|
|
|
(20,757 |
) |
|
|
— |
|
|
Foreign currency losses (gains), net allocated to common
stockholders (4) |
|
(13,855 |
) |
|
|
(3,886 |
) |
|
|
(7,499 |
) |
|
|
(1,427 |
) |
|
Amortization of intangibles allocated to common stockholders |
|
111,508 |
|
|
|
38,747 |
|
|
|
223,350 |
|
|
|
77,317 |
|
|
Share-based compensation allocated to common stockholders |
|
20,786 |
|
|
|
10,996 |
|
|
|
41,602 |
|
|
|
27,457 |
|
|
Income taxes related to the above allocated to common stockholders
(2) |
|
(36,337 |
) |
|
|
(19,254 |
) |
|
|
(75,673 |
) |
|
|
(34,987 |
) |
| Non-GAAP net income
attributable to common stockholders |
$ |
176,055 |
|
|
$ |
135,252 |
|
|
$ |
346,952 |
|
|
$ |
268,777 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2023 |
|
May 31, 2024 |
|
May 31, 2023 |
|
Diluted earnings per common share (“EPS”)(3) |
$ |
0.98 |
|
|
$ |
1.51 |
|
|
$ |
1.74 |
|
|
$ |
3.18 |
|
|
Acquisition-related and integration expenses |
|
0.45 |
|
|
|
0.14 |
|
|
|
0.90 |
|
|
|
0.25 |
|
|
Acquisition-related expenses included in interest expense and
finance charges, net(1) |
|
0.04 |
|
|
|
— |
|
|
|
0.07 |
|
|
|
— |
|
|
Acquisition-related expenses included in other expense (income),
net(1) |
|
— |
|
|
|
0.23 |
|
|
|
— |
|
|
|
0.23 |
|
|
Step-up depreciation |
|
— |
|
|
|
0.24 |
|
|
|
— |
|
|
|
0.24 |
|
|
Imputed interest related to sellers' note included in interest
expense and finance charges, net |
|
0.06 |
|
|
|
— |
|
|
|
0.12 |
|
|
|
— |
|
|
Change in acquisition contingent consideration included in other
expense (income), net |
|
(0.10 |
) |
|
|
— |
|
|
|
(0.32 |
) |
|
|
— |
|
|
Foreign currency losses (gains), net(4) |
|
(0.21 |
) |
|
|
(0.08 |
) |
|
|
(0.11 |
) |
|
|
(0.03 |
) |
|
Amortization of intangibles |
|
1.71 |
|
|
|
0.75 |
|
|
|
3.41 |
|
|
|
1.50 |
|
|
Share-based compensation |
|
0.32 |
|
|
|
0.21 |
|
|
|
0.63 |
|
|
|
0.53 |
|
|
Income taxes related to the above(2) |
|
(0.56 |
) |
|
|
(0.37 |
) |
|
|
(1.15 |
) |
|
|
(0.68 |
) |
| Non-GAAP diluted EPS |
$ |
2.69 |
|
|
$ |
2.63 |
|
|
$ |
5.29 |
|
|
$ |
5.22 |
|
| |
|
|
|
|
|
|
|
| Weighted-average number of
common shares - diluted |
|
65,332 |
|
|
|
51,392 |
|
|
|
65,570 |
|
|
|
51,457 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Six Months Ended |
| |
May 31, 2024 |
|
May 31, 2023 |
|
May 31, 2024 |
|
May 31, 2023 |
|
Net cash provided by operating activities |
$ |
238,339 |
|
|
$ |
133,435 |
|
|
$ |
191,469 |
|
|
$ |
237,328 |
|
| Purchases of property and
equipment |
|
(60,086 |
) |
|
|
(32,184 |
) |
|
|
(116,145 |
) |
|
|
(71,781 |
) |
|
Free cash flow |
|
178,253 |
|
|
|
101,251 |
|
|
|
75,324 |
|
|
|
165,547 |
|
| Change in outstanding
factoring balances |
|
23,634 |
|
|
|
— |
|
|
|
45,258 |
|
|
|
— |
|
|
Adjusted free cash flow |
$ |
201,887 |
|
|
$ |
101,251 |
|
|
$ |
120,582 |
|
|
$ |
165,547 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Forecast |
| |
Three Months Ending August 31, 2024 |
|
Fiscal Year Ending November 30, 2024 |
| |
Low |
|
High |
|
Low |
|
High |
|
Revenue |
$ |
2,350,000 |
|
|
$ |
2,400,000 |
|
|
$ |
9,580,000 |
|
|
$ |
9,675,000 |
|
|
Pro forma revenue growth(5) |
(0.6)% |
|
|
1.4 |
% |
|
|
1.0 |
% |
|
|
2.0 |
% |
|
Foreign exchange impact |
|
2.1 |
% |
|
|
2.1 |
% |
|
|
1.5 |
% |
|
|
1.5 |
% |
| Pro forma constant currency
revenue growth |
|
1.5 |
% |
|
|
3.5 |
% |
|
|
2.5 |
% |
|
|
3.5 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Forecast |
| |
Three Months Ending August 31, 2024 |
|
Fiscal Year Ending November 30, 2024 |
| |
Low |
|
High |
|
Low |
|
High |
|
Operating income |
$ |
171,600 |
|
$ |
181,400 |
|
$ |
695,500 |
|
$ |
724,000 |
|
Amortization of intangibles |
|
113,000 |
|
|
116,000 |
|
|
455,000 |
|
|
461,000 |
|
Share-based compensation |
|
23,000 |
|
|
25,000 |
|
|
95,000 |
|
|
100,000 |
|
Acquisition-related and integration expenses |
|
20,000 |
|
|
25,000 |
|
|
95,000 |
|
|
105,000 |
|
Step-up depreciation |
|
2,400 |
|
|
2,600 |
|
|
9,500 |
|
|
10,000 |
| Non-GAAP operating income |
$ |
330,000 |
|
$ |
350,000 |
|
$ |
1,350,000 |
|
$ |
1,400,000 |
| |
|
|
|
|
|
|
|
|
|
|
|
(1) Included in these amounts are a) bridge financing fees
expensed and b) expenses associated with non-designated call option
contracts put in place to hedge foreign exchange movements in
connection with the Webhelp combination that are included within
interest expense and finance charges, net and other expense
(income), net, respectively, in the consolidated statement of
operations.
(2) The tax effect of taxable and deductible non-GAAP
adjustments was calculated using the tax-deductible portion of the
expenses and applying the entity-specific, statutory tax rates
applicable to each item during the respective periods
presented.
(3) Diluted EPS is calculated using the two-class method. The
two-class method is an earnings allocation proportional to the
respective ownership among holders of common stock and
participating securities. Restricted stock awards, and effective in
the fourth quarter of fiscal year 2023, restricted stock units
granted to employees are considered participating securities. For
the purposes of calculating diluted EPS, net income attributable to
participating securities was approximately 3.8% and 1.7% of net
income, respectively, for the three months ended May 31, 2024
and 2023 and 3.8% and 1.7% of net income, respectively, for the six
months ended May 31, 2024 and 2023, and was excluded from
total net income to calculate net income attributable to common
stockholders. In addition, the non-GAAP adjustments allocated to
common stockholders were calculated based on the percentage of net
income attributable to common stockholders.
(4) Foreign currency losses (gains), net are included in other
expense (income), net and primarily consist of gains and losses
recognized on the revaluation and settlement of foreign currency
transactions and realized and unrealized gains and losses on
derivative contracts that do not qualify for hedge accounting. The
reported amounts for non-GAAP net income and non-GAAP EPS for the
three- and six- months ended May 31, 2024 include adjustments to
exclude these foreign currency losses (gains), net, which were not
adjusted in similar non-GAAP measures previously reported for the
corresponding period in fiscal year 2023. In order to enhance
comparability, similar adjustments were made for non-GAAP net
income and non-GAAP EPS for the three- and six-months ended May 31,
2023.
(5) The supplemental pro forma revenue presented below is for
illustrative purposes only, does not include the pro forma
adjustments that would be required under Regulation S-X for pro
forma financial information, is not necessarily indicative of the
financial position or results of operations that would have been
realized if the combination with Webhelp had been completed on
December 1, 2022, does not reflect synergies that might have been
achieved, nor is it indicative of future operating results or
financial position. The pro forma adjustments are based upon
currently available information and certain assumptions that the
Company believes are reasonable under the circumstances.
The supplemental pro forma financial information reflects pro
forma adjustments to present the combined pro forma results of
operations as if the combination with Webhelp had occurred on
December 1, 2022. The supplemental pro forma financial information
for the quarter ended August 31, 2023 and the fiscal year ended
November 30, 2023 is as follows:
| |
Three Months Ended |
|
Fiscal Year Ended |
| |
August 31, 2023 |
|
November 30, 2023 |
|
Revenue |
$ |
2,367,086 |
|
$ |
9,485,600 |
Concentrix (NASDAQ:CNXC)
過去 株価チャート
から 5 2024 まで 6 2024
Concentrix (NASDAQ:CNXC)
過去 株価チャート
から 6 2023 まで 6 2024
