SAN FRANCISCO, Aug. 10, 2016 /PRNewswire/ -- Globant (NYSE:
GLOB), a digitally-native technology services company focused on
creating digital journeys, today announced results for the
three and six months ended June 30,
2016.
Second quarter 2016 highlights
- Revenue increased to a record $79.9
million, representing 31.9% year-over-year growth.
- Non-IFRS Adjusted Gross Profit was $34.1
million (42.6% Non-IFRS Adjusted Gross Profit Margin), an
increase of $10.7 million compared to
$23.4 million (and an increase of 390
basis points compared to 38.7% Non-IFRS Adjusted Gross Profit
Margin) in 2015.
- Non-IFRS Adjusted Net Income was $10.2
million (12.7% Non-IFRS Adjusted Net Income Margin), an
increase of $1.6 million, or 18.6%,
compared to a profit of $8.6 million
for the second quarter of 2015.
- Non-IFRS Adjusted Diluted EPS was $0.29 per share (based on an average of 35.2
million average diluted shares during the second quarter), an
increase of $0.04 compared to
Non-IFRS Adjusted Diluted EPS of $0.25 for the second quarter of 2015.
Six months ended June 30, 2016
highlights
- Revenue for the period increased to $153.3 million, representing 33.1% year-over-year
growth.
- Non-IFRS Adjusted Gross Profit was $67.1
million (43.8% Non-IFRS Adjusted Gross Profit Margin), an
increase of $22.6 million compared to
$44.5 million (and an increase of 520
basis points compared to 38.6% Non-IFRS Adjusted Gross Profit
Margin) in 2015.
- Non-IFRS Adjusted Net Income was $18.6
million (12.1% Non-IFRS Adjusted Net Income Margin), an
increase of $2.4 million, or 14.8%,
compared to a profit of $ $16.2
million the first six months of 2015.
- Non-IFRS Adjusted Diluted EPS was $0.53 per share (based on an average of 35.2
million diluted shares during the first six months of the 2016), an
increase of $0.06 compared to
Non-IFRS Adjusted Diluted EPS of $0.47 for the first six months of 2015.
Reconciliations between Non-IFRS / adjusted financial measures
and IFRS operating results are included at the end of this press
release.
"We are very pleased with our second quarter performance. We
continue to experience strong momentum in the business. Our
revenues increased to a record $79.9
million, a solid 31.9% year-over-year growth," said Martín
Migoya, Globant's CEO and co-founder.
"The market continues to rely on the growth of digital services'
demand, where we maintain our positioning as leader. This can be
seen in the latest IDC MarketScape report, which recognized us as a
worldwide leader of digital strategy consulting services," Migoya
added. "To reinforce our positioning and focus on strategy and
digital transformation, we announced the acquisition of WAE, an
innovative service design company with operations in the UK and the
US. We are confident that our portfolio of services is well
positioned to continue creating innovative digital journeys for our
customers".
"I am very pleased with our financial performance for this
quarter. We delivered solid revenue growth, strong gross and
operating income margins, and a healthy net income. These positive
numbers, coupled with increased diversification in terms of
customers and delivery centers, are extremely important to enable
us to achieve our financial and operational targets," explained
Alejandro Scannapieco, Globant's
CFO.
Globant completed the quarter with 5,380 Globers, 4,932 of whom
were IT professionals. The geographic revenue breakdown for the
second quarter was as follows: 81.1% from North America (top country: U.S.), 10.7% from
Latin America and others (top
country: Chile) and 8.2% from
Europe (top country: UK). 90.9% of
Globant's revenue for the second quarter was denominated in U.S.
dollars, and the remaining 9.1% was denominated in other
currencies.
During the 12 months ended June 30,
2016, Globant served 366 customers, 57 of which accounted
for more than $1 million of Globant's
revenues. Globant's top customer, top 5 customers and top 10
customers represented 10.0%, 34.2% and 46.4% of the second quarter
revenues, respectively.
Cash and cash equivalents and investments as of June 30, 2016 decreased to $55.7 million from $62.4
million as of December 31,
2015, while borrowings amounted to $0.3 million. Current assets as of June 30, 2016 amounted to $124.8 million, accounting for 49.1% of total
assets. Finally, as of June 30, 2015,
34.4 million common shares were issued and outstanding.
2016 Third Quarter and Full Year Outlook
Based on current market conditions, Globant is providing the
following estimates for the third quarter and for the full year
2016:
- Third quarter revenue is estimated to be in the range of
$80-$82 million.
- Third quarter Non-IFRS diluted EPS is estimated to be in the
range of $0.27-$0.31 (assuming an
average of 35.4 million diluted shares outstanding during the third
quarter).
- Fiscal year 2016 revenue is estimated to be between
$318-$322 million
- Fiscal year 2016 Non-IFRS diluted EPS is estimated to be in the
range of $1.14-$1.20 (assuming an
average of 35.6 million average diluted shares outstanding during
2016).
Conference Call and Webcast
Martín Migoya and Alejandro
Scannapieco will discuss the three and six-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/
Additionally, a replay will be available via the same dial-in
number and on our investor relations website after the call.
About Globant
Globant (NYSE: GLOB) is a digitally native technology services
company that creates digital journeys for its customers, which
impact millions of consumers. Globant is the place where
engineering, design, and innovation meet scale.
Globant has more than 5,350 professionals in 12 countries
working for companies like Google, Linkedin, JWT, EA, and Coca
Cola, among others.
Globant was named a Worldwide Leader of Digital Strategy
Consulting Services by IDC MarketScape Report (2016), and its
client work has been featured as business case studies at
Harvard University, Massachusetts Institute of Technology, and Stanford
University. For more information visit www.globant.com.
Non-IFRS Financial Information
Globant provides non-IFRS financial measures to complement
reported IFRS results, in accordance with IAS 34 "Interim Financial
Reporting". 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, depreciation and amortization,
acquisition related expenses and impairments of tax credits.
Because the company's 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
Unaudited interim consolidated financial statements, which are
prepared according to IAS 34.
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 our most recent 20-F 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)
|
|
|
|
|
|
|
|
|
|
|
Six months
ended
|
|
Three months
ended
|
|
|
|
|
June 30,
2016
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
153,252
|
|
115,116
|
|
79,926
|
|
60,604
|
|
Cost of
revenues
|
|
|
(88,521)
|
|
(73,007)
|
|
(47,163)
|
|
(38,393)
|
|
Gross
profit
|
|
|
64,731
|
|
42,109
|
|
32,763
|
|
22,211
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
(38,088)
|
|
(33,418)
|
|
(20,319)
|
|
(17,961)
|
|
Impairment of tax
credits, net of recoveries
|
|
|
-
|
|
1,820
|
|
-
|
|
-
|
|
Profit from
operations
|
|
|
26,643
|
|
10,511
|
|
12,444
|
|
4,250
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on transactions
with bonds
|
|
|
-
|
|
8,351
|
|
-
|
|
4,367
|
|
Finance
income
|
|
|
11,089
|
|
6,500
|
|
4,203
|
|
3,943
|
|
Finance
expense
|
|
|
(13,133)
|
|
(5,103)
|
|
(5,686)
|
|
(2,367)
|
|
Finance (expense)
income, net
|
|
|
(2,044)
|
|
1,397
|
|
(1,483)
|
|
1,576
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income and
(expenses), net
|
|
|
654
|
|
(3)
|
|
651
|
|
-
|
|
Profit before
income tax
|
|
|
25,253
|
|
20,256
|
|
11,612
|
|
10,193
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
|
|
|
(8,399)
|
|
(5,178)
|
|
(2,674)
|
|
(2,620)
|
|
Net income for the
period
|
|
|
16,854
|
|
15,078
|
|
8,938
|
|
7,573
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income, net of income tax effects
|
|
|
|
|
|
|
|
|
|
|
Items that may be
reclassified subsequently to profit and loss:
|
|
|
|
|
|
|
|
|
|
|
- Exchange differences on translating foreign
operations
|
|
|
1,151
|
|
(429)
|
|
742
|
|
175
|
|
- Net fair value loss on available-for-sale financial
assets
|
|
|
(20)
|
|
-
|
|
(948)
|
|
-
|
|
Total comprehensive income for the
period
|
|
|
17,985
|
|
14,649
|
|
8,732
|
|
7,748
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to:
|
|
|
|
|
|
|
|
|
|
|
Owners of the
Company
|
|
|
16,863
|
|
15,078
|
|
8,923
|
|
7,573
|
|
Non-controlling
interest
|
|
|
(9)
|
|
-
|
|
15
|
|
-
|
|
Net income for the
period
|
|
|
16,854
|
|
15,078
|
|
8,938
|
|
7,573
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
comprehensive income for the period attributable to:
|
|
|
|
|
|
|
|
|
|
|
Owners of the
Company
|
|
|
17,994
|
|
14,649
|
|
8,717
|
|
7,748
|
|
Non-controlling
interest
|
|
|
(9)
|
|
-
|
|
15
|
|
-
|
|
Total
comprehensive income for the period
|
|
|
17,985
|
|
14,649
|
|
8,732
|
|
7,748
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
0.49
|
|
0.45
|
|
0.26
|
|
0.22
|
|
Diluted
|
|
|
0.48
|
|
0.43
|
|
0.25
|
|
0.22
|
|
Weighted average
of outstanding shares (in thousands)
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
34,270
|
|
33,788
|
|
34,317
|
|
33,952
|
|
Diluted
|
|
|
35,182
|
|
34,735
|
|
35,230
|
|
34,899
|
|
Globant S.A. Condensed Interim
Consolidated Statement of Financial Position (In
thousands of U.S. dollars, unaudited)
|
|
|
|
|
|
|
|
|
|
June 30,
2016
|
|
Dec 31,
2015
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
18,765
|
|
36,720
|
Investments
|
|
|
36,973
|
|
25,660
|
Trade
receivables
|
|
|
51,820
|
|
45,952
|
Other
receivables
|
|
|
16,335
|
|
18,570
|
Other financial
assets
|
|
|
900
|
|
900
|
Total current
assets
|
|
|
124,793
|
|
127,802
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
Other
receivables
|
|
|
25,885
|
|
20,122
|
Deferred tax
assets
|
|
|
8,440
|
|
7,983
|
Investment in
associates
|
|
|
800
|
|
300
|
Other financial
assets
|
|
|
1,186
|
|
1,221
|
Property and
equipment
|
|
|
33,481
|
|
25,720
|
Intangible
assets
|
|
|
10,557
|
|
7,209
|
Goodwill
|
|
|
49,081
|
|
32,532
|
Total non-current
assets
|
|
|
129,430
|
|
95,087
|
TOTAL
ASSETS
|
|
|
254,223
|
|
222,889
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Trade
payables
|
|
|
7,347
|
|
4,436
|
Payroll and social
security taxes payable
|
|
|
25,306
|
|
25,551
|
Borrowings
|
|
|
249
|
|
280
|
Other financial
liabilities
|
|
|
6,456
|
|
6,240
|
Tax
liabilities
|
|
|
5,656
|
|
10,225
|
Other
liabilities
|
|
|
10
|
|
9
|
Total current
liabilities
|
|
|
45,024
|
|
46,741
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
Borrowings
|
|
|
90
|
|
268
|
Other financial
liabilities
|
|
|
24,780
|
|
15,045
|
Other
liabilities
|
|
|
20
|
|
-
|
Provisions for
contingencies
|
|
|
788
|
|
650
|
Total non-current
liabilities
|
|
|
25,678
|
|
15,963
|
TOTAL
LIABILITIES
|
|
|
70,702
|
|
62,704
|
|
|
|
|
|
|
Capital and
reserves
|
|
|
|
|
|
Issued and paid-in
capital
|
|
|
41,300
|
|
41,050
|
Additional paid-in
capital
|
|
|
56,955
|
|
51,854
|
Other
reserves
|
|
|
(881)
|
|
(2,012)
|
Retained
earnings
|
|
|
86,106
|
|
69,243
|
Total equity
attributable to owners of the Company
|
|
|
183,480
|
|
160,135
|
Non-controlling
interests
|
|
|
41
|
|
50
|
Total
equity
|
|
|
183,521
|
|
160,185
|
TOTAL EQUITY AND
LIABILITIES
|
|
|
254,223
|
|
222,889
|
Supplemental Non-IFRS Financial
Information (In thousands of U.S. dollars,
unaudited)
|
|
|
|
|
|
|
|
|
|
Six months
ended
|
|
Three months
ended
|
|
|
|
June 30,
2016
|
|
June 30,
2015
|
|
June 30,
2016
|
|
June 30,
2015
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
adjusted gross profit
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
64,731
|
|
42,109
|
|
32,763
|
|
22,211
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
|
1,929
|
|
2,274
|
|
1,015
|
|
1,167
|
Share-based
compensation expense
|
|
|
448
|
|
72
|
|
304
|
|
67
|
Adjusted gross
profit
|
|
|
67,108
|
|
44,455
|
|
34,082
|
|
23,445
|
Adjusted gross
profit margin
|
|
|
43.8%
|
|
38.6%
|
|
42.6%
|
|
38.7%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
selling, general and administrative expenses
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
(38,088)
|
|
(33,418)
|
|
(20,319)
|
|
(17,961)
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
|
2,767
|
|
2,472
|
|
1,433
|
|
1,277
|
Acquisition related
costs
|
|
|
-
|
|
337
|
|
-
|
|
337
|
Share-based
compensation expense
|
|
|
1,286
|
|
675
|
|
935
|
|
666
|
Adjusted selling,
general and administrative expenses
|
|
|
(34,035)
|
|
(29,934)
|
|
(17,951)
|
|
(15,681)
|
Adjusted selling,
general and administrative expenses as % of revenues
|
(22.2)%
|
|
(26.0)%
|
|
(22.5)%
|
|
(25.9)%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Adjusted Profit from Operations
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
26,643
|
|
10,511
|
|
12,444
|
|
4,250
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Impairment of tax
credits, net of recoveries
|
|
|
-
|
|
(1,820)
|
|
-
|
|
-
|
Acquisition related
costs
|
|
|
-
|
|
337
|
|
-
|
|
337
|
Share-based
compensation expense
|
|
|
1,734
|
|
747
|
|
1,239
|
|
733
|
Adjusted Profit
from Operations
|
|
|
28,377
|
|
9,775
|
|
13,683
|
|
5,320
|
Adjusted Operating
Profit margin
|
|
|
18.5%
|
|
8.5%
|
|
17.1%
|
|
8.8%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Net income (loss) for the period
|
|
|
|
|
|
|
|
|
|
Net income for the
period
|
|
|
16,854
|
|
15,078
|
|
8,938
|
|
7,573
|
Adjustments
|
|
|
|
|
|
|
|
|
|
Share-based
compensation expense
|
|
|
1,734
|
|
747
|
|
1,239
|
|
733
|
Acquisition related
costs
|
|
|
-
|
|
337
|
|
-
|
|
337
|
Adjusted Net
income
|
|
|
18,588
|
|
16,162
|
|
10,177
|
|
8,643
|
Adjusted Net
income margin
|
|
|
12.1%
|
|
14.0%
|
|
12.7%
|
|
14.3%
|
|
|
|
|
|
|
|
|
|
|
Calculation of
Adjusted Diluted EPS
|
|
|
|
|
|
|
|
|
|
Adjusted Net
income
|
|
|
18,588
|
|
16,162
|
|
10,177
|
|
8,643
|
Diluted
shares
|
|
|
35,182
|
|
34,735
|
|
35,230
|
|
34,899
|
Adjusted Diluted
EPS
|
|
|
0.53
|
|
0.47
|
|
0.29
|
|
0.25
|
Globant
S.A. Schedule of Supplemental Information
|
|
|
|
|
|
|
|
Metric
|
Q1
2015
|
Q2
2015
|
Q3
2015
|
Q4
2015
|
Q1
2016
|
Q2
2016
|
|
|
|
|
|
|
|
Total
Employees
|
4,040
|
4,512
|
4,724
|
5,041
|
5,285
|
5,380
|
IT
Professionals
|
3,694
|
4,121
|
4,327
|
4,613
|
4,847
|
4,932
|
|
|
|
|
|
|
|
North America Revenue
%
|
84.1
|
85.2
|
84.1
|
81.7
|
82.2
|
81.1
|
Latin America and
Others Revenue %
|
10.1
|
9.7
|
11.5
|
12.2
|
10.8
|
10.7
|
Europe Revenue
%
|
5.8
|
5.1
|
4.4
|
6.0
|
7.0
|
8.2
|
|
|
|
|
|
|
|
USD Revenue
%
|
95.0
|
94.6
|
93.3
|
90.8
|
91.9
|
90.9
|
GBP Revenue
%
|
1.0
|
0.8
|
1.4
|
2.4
|
0.4
|
1.2
|
Other Currencies
Revenue %
|
4.0
|
4.6
|
5.3
|
6.8
|
7.8
|
7.9
|
|
|
|
|
|
|
|
Top Customer
%
|
10.2
|
12.3
|
13.4
|
12.7
|
11.6
|
10.0
|
Top 5 Customers
%
|
30.8
|
32.8
|
33.2
|
34.4
|
36.4
|
34.2
|
Top 10 Customers
%
|
47.8
|
47.7
|
45.9
|
46.4
|
48.4
|
46.4
|
|
|
|
|
|
|
|
LTM Customers
Served
|
292
|
344
|
343
|
344
|
359
|
366
|
LTM Customers with
>$1M in Revenue
|
43
|
43
|
47
|
51
|
49
|
57
|
Investor Relations Contact:
Juan Urthiague, Globant
investors@globant.com
(877) 215-5230
Media Contact:
Wanda Weigert, Globant
pr@globant.com
(877) 215-5230
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SOURCE Globant