SAN FRANCISCO, Nov. 10, 2014 /PRNewswire/ -- Globant (NYSE:
GLOB), a new-breed technology services provider focused on
delivering innovative software solutions by leveraging emerging
technologies and trends, today announced results for the three and
nine months ending September 30,
2014.
Highlights
- Revenue for the third quarter was $52.0
million, another quarterly record for the company,
representing 28.7% year-over-year growth
- Revenue for the first nine months of the year was $144.5 million, representing 28.9% year-over-year
growth
- IFRS Gross Profit for the third quarter was $20.4 million (39.2% IFRS Gross Profit Margin)
and Non-IFRS Adjusted Gross Profit for the third quarter was
$21.3 million (41.0% Non-IFRS
Adjusted Gross Profit Margin)
- IFRS Profit for the third quarter was $7.8 million (15.0% IFRS Profit Margin) and
Non-IFRS Adjusted Profit for the quarter was $8.4 million (16.1% Non-IFRS Adjusted Profit
Margin)
- IFRS Diluted EPS for the third quarter was $0.23 per share and Non-IFRS Adjusted Diluted EPS
for the third quarter was $0.25 per
share (assuming 33.4 million average diluted shares for the
quarter)
Reconciliations between Non-IFRS / adjusted financial measures
and IFRS operating results are included at the end of this press
release.
"Many exciting things have happened that enabled us to have
another record quarter and the highest quarterly revenue in our
history. Our impressive performance was mainly pushed by the solid
execution of our strategy by our Studios and business units",
described Martin Migoya, CEO and
co-founder of Globant. "We continue to see our clients' budgets
moving from traditional IT spending into consumer-oriented
initiatives involving emerging technologies. We believe that
our Studios model will continue to be the best way to provide
innovative software solutions in this changing environment".
"We are also thrilled to announce the expansion of our Agile
Pods model, our unique methodology of building software, which our
customers have responded to by developing more long-term
engagements with Globant", Migoya added. "As more clients see the
positive results of our Agile Pods methodology, which is
tailored-made to improve their businesses by combining agility and
maturity to drive innovation and efficiency, they are choosing to
grow their relationships with us. We expect this trend to remain
strong in the fourth quarter, as we continue to add key accounts to
our portfolio such as AEP Energy, a long-term engagement, closed in
October."
Globant finished the quarter with 3,567 Globers, of which 3,217
were IT professionals. Geographic revenue breakdown for the nine
months ended September 30, 2014 was
as follows: 81% from North America
(U.S. top country), 13% from Latin
America (Chile top country)
and 6% from Europe (U.K. top
country). 93% of Globant's revenue for the third quarter was
denominated in U.S. dollars, with 1% in British pounds and 6% in
other currencies.
We ended the quarter with 299 customers served during the last
12 months. Of these, 45 were customers with revenues of more than
$1 million during that period.
For the nine months ending in September 30,
2014, our top customer represented 8.7% of our revenues, our
top 5 customers represented 27.7% of our revenues and our top 10
customers represented 43.6% of our revenues.
Cash and investments as of September 30,
2014 increased to $58.6
million and long-term borrowings decreased to $0.9 million. Total shares outstanding as
of September 30, 2014 were 33,345,158
common shares.
Full Year and Fourth Quarter Outlook
For the fourth quarter of 2014, Globant estimates revenue to be
between $53 - $55 million.
Non-IFRS Adjusted Profit Margin for the quarter is estimated to be
between 11% - 12%, with Non-IFRS Adjusted Diluted EPS in the range
of $0.17 - $0.21 (assuming 34.5
million average diluted shares outstanding for the quarter).
For the full year 2014, Globant estimates revenue to be between
$197 - $199 million. Non-IFRS
Adjusted Profit Margin for the year is estimated to be between 11%
- 12%, with Non-IFRS Adjusted Diluted EPS in the range of
$0.70 - $0.78 (assuming 32.1 million
average diluted shares outstanding for the full year).
Conference Call and Webcast
Martin Migoya and Alejandro Scannapieco will discuss the three and
nine month results in a conference call today beginning at
4:30pm ET.
Conference call access information is:
US +1 (888) 346-2877
International +1 (412) 902-4257
Webcast http://investors.globant.com/index.php?s=19&item=8
Additionally, a replay will be available via the same dial-in
information and in our investor relations website after the
call.
About Globant
Globant (NYSE: GLOB) is a new-breed technology services provider
focused on delivering innovative software solutions by leveraging
emerging technologies and trends. Globant combines the
engineering and technical rigor of IT services providers with the
creative approach and culture of digital agencies. Customers select
Globant as the place where engineering, design and innovation meet
scale. In only 11 years, Globant has grown into a company
with more than 3,500 professionals working for companies like
Google, Linkedin, JWT, EA and Coca-Cola, among others, has been
recognized as one of the Top 10 Most Innovative Companies in
South America by FastCompany, was
included in the 2010 Cool Vendor in Business Process Services
Report by Gartner, and has been featured as case study at
Harvard, MIT and Stanford. For more information visit
www.globant.com.
Non-IFRS Financial Information
Globant provides non-IFRS financial measures to complement
reported IFRS results. Management believes these measures help
illustrate underlying trends in the company's business and uses the
measures to establish budgets and operational goals, communicated
internally and externally, for managing the company's 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 results that
exclude share-based compensation expense, amortization of purchased
intangible assets, and provisions resulting from changes in
valuation allowances. Because the company's reported 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 company's industry. Consequently,
Globant's non-IFRS financial measures should not be evaluated in
isolation or supplant comparable IFRS measures, but, rather, should
be considered together with its consolidated financial statements,
which are prepared according to IFRS.
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, Section 27A of the
Securities Act of 1933, and Section 21E of the Securities Exchange
Act of 1934. These forward-looking statements include information
about possible or assumed future results of our business and
financial condition, as well as the results of operations,
liquidity, plans and objectives. In some cases, you can identify
forward-looking statements by terminology such as "believe," "may,"
"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: the persistence and
intensification of competition in the IT industry; the future
growth of spending in IT services outsourcing generally,
application outsourcing and custom application development and
offshore development services; the level of growth of demand for
our services from our clients; the level of increase in revenues
from our new clients; the resource utilization rates and
productivity levels, the level of attrition of our IT
professionals; the pricing structures we use for our client
contracts; general economic and business conditions in the
locations in which we operate; the levels of our concentration of
revenues by vertical, geography, by client and by type of contract
in the future; the continuity of the tax incentives available for
software companies with operations in Argentina; Argentina's regulations on proceeds from the
export of services; our expectation that we will be able to
integrate and manage the companies we acquire and that our
acquisitions will yield the benefits we envision; the demands we
expect our rapid growth to place on our management and
infrastructure; the sufficiency of our current cash, cash flow from
operations, and lines of credit to meet our anticipated cash needs;
the high proportion of our cost of services comprised of personnel
salaries; and other factors discussed under the heading "Risk
Factors" in the final prospectus for our initial public offering
and other documents filed with the Securities and Exchange
Commission.
These forward-looking statements involve various risks and
uncertainties. Although the registrant believes that its
expectations expressed in these forward-looking statements are
reasonable, its expectations may turn out to be incorrect. The
registrant's actual results could be materially different from its
expectations. In light of the risks and uncertainties described
above, the estimates and forward-looking statements discussed might
not occur, and the registrant's future results and its performance
may differ materially from those expressed in these forward-looking
statements due to, inclusive, but not limited to, the factors
mentioned above. Because of these uncertainties, you should not
make any investment decision based on these 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
Statement of Profit or Loss and Other Comprehensive
Income
(In thousands of U.S. dollars, except per share
amounts, unaudited)
|
|
|
Nine months
ended
|
|
Three months
ended
|
|
|
|
Sept 30,
2014
|
|
Sept 30,
2013
|
|
Sept 30,
2014
|
|
Sept 30,
2013
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
144,488
|
|
112,089
|
|
51,959
|
|
40,367
|
Cost of
revenues
|
|
|
(87,333)
|
|
(70,273)
|
|
(31,596)
|
|
(24,686)
|
Gross
profit
|
|
|
57,155
|
|
41,816
|
|
20,363
|
|
15,681
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
(41,436)
|
|
(38,738)
|
|
(15,103)
|
|
(13,904)
|
Impairment of tax
credits
|
|
|
(821)
|
|
-
|
|
(40)
|
|
-
|
Profit from
operations
|
|
|
14,898
|
|
3,078
|
|
5,220
|
|
1,777
|
|
|
|
|
|
|
|
|
|
|
Gain on transactions
with bonds
|
|
|
10,023
|
|
20,819
|
|
5,244
|
|
9,525
|
Finance
income
|
|
|
8,077
|
|
257
|
|
2,992
|
|
134
|
Finance
expense
|
|
|
(9,725)
|
|
(4,031)
|
|
(3,263)
|
|
(1,804)
|
Finance expense,
net
|
|
|
(1,648)
|
|
(3,774)
|
|
(271)
|
|
(1,670)
|
|
|
|
|
|
|
|
|
|
|
Other income and
expenses, net
|
|
|
(50)
|
|
1,703
|
|
(23)
|
|
1,703
|
Profit before
income tax
|
|
|
23,223
|
|
21,826
|
|
10,170
|
|
11,335
|
|
|
|
|
|
|
|
|
|
|
Income tax
|
|
|
(6,108)
|
|
(4,215)
|
|
(2,380)
|
|
(1,718)
|
Profit for the
period
|
|
|
17,115
|
|
17,611
|
|
7,790
|
|
9,617
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive loss net of income tax
|
|
|
|
|
|
|
|
|
|
Items that may be
reclassified subsequently to profit and loss:
|
|
|
|
|
|
|
|
|
|
- Exchange
differences on translating foreign operations
|
|
|
(172)
|
|
(276)
|
|
(376)
|
|
(207)
|
Total
comprehensive income for the period
|
|
|
16,943
|
|
17,335
|
|
7,414
|
|
9,410
|
|
|
|
|
|
|
|
|
|
|
Profit
attributable to:
|
|
|
|
|
|
|
|
|
|
Owners of the
Company
|
|
|
17,058
|
|
17,611
|
|
7,785
|
|
9,617
|
Non-controlling
interest
|
|
|
57
|
|
-
|
|
5
|
|
-
|
Profit for the
period
|
|
|
17,115
|
|
17,611
|
|
7,790
|
|
9,617
|
|
|
|
|
|
|
|
|
|
|
Total
comprehensive income for the period attributable to:
|
|
|
|
|
|
|
|
|
|
Owners of the
Company
|
|
|
16,886
|
|
17,335
|
|
7,409
|
|
9,410
|
Non-controlling
interest
|
|
|
57
|
|
-
|
|
5
|
|
-
|
Total
comprehensive income for the period
|
|
|
16,943
|
|
17,335
|
|
7,414
|
|
9,410
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
0.57
|
|
0.63
|
|
0.24
|
|
0.36
|
Diluted
|
|
|
0.55
|
|
0.59
|
|
0.23
|
|
0.33
|
Weighted average
of outstanding shares (in thousands)
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
30,099
|
|
27,772
|
|
32,294
|
|
27,818
|
Diluted
|
|
|
31,177
|
|
29,784
|
|
33,372
|
|
29,830
|
Globant S.A.
Condensed Interim Consolidated
Statement of Financial Position
(In thousands of U.S.
dollars, unaudited)
|
|
|
Sept 30,
2014
|
|
Dec 31,
2013
|
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
43,277
|
|
17,051
|
Restricted cash
equivalent
|
|
|
1,689
|
|
-
|
Investments
|
|
|
13,640
|
|
9,634
|
Trade
receivables
|
|
|
38,043
|
|
34,418
|
Other
receivables
|
|
|
10,552
|
|
6,346
|
Total current
assets
|
|
|
107,201
|
|
67,449
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
Other
receivables
|
|
|
5,027
|
|
5,987
|
Deferred tax
assets
|
|
|
3,213
|
|
3,117
|
Investment in
associates
|
|
|
490
|
|
-
|
Other financial
assets
|
|
|
942
|
|
1,284
|
Property and
equipment
|
|
|
16,095
|
|
14,723
|
Intangible
assets
|
|
|
5,712
|
|
6,141
|
Goodwill
|
|
|
12,943
|
|
13,046
|
Total non-current
assets
|
|
|
44,422
|
|
44,298
|
TOTAL
ASSETS
|
|
|
151,623
|
|
111,747
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Trade
payables
|
|
|
4,242
|
|
8,016
|
Payroll and social
security taxes payable
|
|
|
19,491
|
|
17,823
|
Borrowings
|
|
|
2,928
|
|
1,048
|
Other financial
liabilities
|
|
|
1,413
|
|
6,023
|
Tax
liabilities
|
|
|
3,749
|
|
5,190
|
Other
liabilities
|
|
|
876
|
|
24
|
Total current
liabilities
|
|
|
32,699
|
|
38,124
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
Borrowings
|
|
|
858
|
|
10,747
|
Other financial
liabilities
|
|
|
2,214
|
|
2,740
|
Other
liabilities
|
|
|
114
|
|
-
|
Provisions for
contingencies
|
|
|
515
|
|
271
|
Total non-current
liabilities
|
|
|
3,701
|
|
13,758
|
TOTAL
LIABILITIES
|
|
|
36,400
|
|
51,882
|
|
|
|
|
|
|
Capital and
reserves
|
|
|
|
|
|
Issued and paid-in
capital
|
|
|
40,014
|
|
34,794
|
Additional paid-in
capital
|
|
|
45,663
|
|
12,468
|
Foreign currency
translation reserve
|
|
|
(450)
|
|
(278)
|
Retained
earnings
|
|
|
29,447
|
|
12,389
|
Total equity
attributable to owners of the Company
|
|
|
114,674
|
|
59,373
|
Non-controlling
interests
|
|
|
549
|
|
492
|
Total
equity
|
|
|
115,223
|
|
59,865
|
TOTAL EQUITY AND
LIABILITIES
|
|
|
151,623
|
|
111,747
|
|
|
|
|
|
|
Supplemental Non-IFRS Financial Information
(In
thousands of U.S. dollars, unaudited)
|
|
|
Nine months
ended
|
|
Three months
ended
|
|
|
|
Sept 30,
2014
|
|
Sept 30,
2013
|
|
Sept 30,
2014
|
|
Sept 30,
2013
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
adjusted gross profit
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
57,155
|
|
41,816
|
|
20,363
|
|
15,681
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
2,651
|
|
2,122
|
|
949
|
|
863
|
Share-based
compensation expense
|
|
|
35
|
|
73
|
|
1
|
|
32
|
Adjusted gross
profit
|
|
|
59,841
|
|
44,011
|
|
21,313
|
|
16,576
|
Adjusted gross
profit margin
|
|
|
41.4%
|
|
39.3%
|
|
41.0%
|
|
41.1%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
adjusted gross profit margin
|
|
|
|
|
|
|
|
|
|
Gross Profit
margin
|
|
|
39.6%
|
|
37.3%
|
|
39.2%
|
|
38.8%
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization as % of revenues
|
|
|
1.8%
|
|
1.9%
|
|
1.8%
|
|
2.1%
|
Share-based
compensation expense as % of revenues
|
|
|
0.0%
|
|
0.1%
|
|
0.0%
|
|
0.1%
|
Adjusted gross
profit margin
|
|
|
41.4%
|
|
39.3%
|
|
41.0%
|
|
41.0%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
selling, general and administrative expenses
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
(41,436)
|
|
(38,738)
|
|
(15,103)
|
|
(13,904)
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
3,048
|
|
3,026
|
|
1,114
|
|
973
|
Share-based
compensation expense
|
|
|
582
|
|
451
|
|
569
|
|
390
|
Adjusted selling,
general and administrative expenses
|
|
|
(37,806)
|
|
(35,261)
|
|
(13,420)
|
|
(12,541)
|
Adjusted selling,
general and administrative expenses as % of revenues
|
-26.2%
|
|
-31.5%
|
|
-25.8%
|
|
-31.1%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
adjusted profit from operations
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
14,898
|
|
3,078
|
|
5,220
|
|
1,777
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Impairment of tax
credits
|
|
|
821
|
|
-
|
|
40
|
|
-
|
Share-based
compensation expense
|
|
|
617
|
|
524
|
|
570
|
|
422
|
Adjusted profit
from operations
|
|
|
16,336
|
|
3,602
|
|
5,830
|
|
2,199
|
Adjusted operating
profit margin
|
|
|
11.3%
|
|
3.2%
|
|
11.2%
|
|
5.4%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
profit for the period
|
|
|
|
|
|
|
|
|
|
Profit for the
Period
|
|
|
17,115
|
|
17,611
|
|
7,790
|
|
9,617
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Share-based
compensation expense
|
|
|
617
|
|
524
|
|
570
|
|
422
|
Adjusted profit
for the period
|
|
|
17,732
|
|
18,135
|
|
8,360
|
|
10,039
|
Adjusted profit
for the period as % of revenues
|
|
|
12.3%
|
|
16.2%
|
|
16.1%
|
|
24.9%
|
|
|
|
|
|
|
|
|
|
|
Investor Relations Contact:
Andrew Burgert, Globant
investors@globant.com
(877) 215-5230
Media Contact:
Wanda Weigert, Globant
press@globant.com
(877) 215-5230
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SOURCE Globant