DENVER, May 4, 2021 /PRNewswire/ -- TTEC
Holdings, Inc. (NASDAQ: TTEC), one of the largest, global
CX (customer experience) technology and services innovators
for end-to-end digital CX solutions, announced today financial
results for the first quarter ended March
31, 2021.
"Our broad-based financial momentum is accelerating and for the
fourth consecutive quarter we have delivered record financial
results," commented Ken Tuchman,
chairman and chief executive officer of TTEC. "Across the
industries and geographies that we serve, improving the customer
experience has never been more urgent. The experience economy
has created an explosion of interaction volumes across a myriad of
channels. The result is a dizzying array of challenges for
companies and government entities alike. Their brand equity and
their financial success are now reliant upon their ability to
rapidly modernize their technology, operations and processes to
deliver a frictionless, personalized experience. Given our
sustained momentum and strong bookings, pipeline, and revenue
backlog, it is evident that more of the world's most iconic and
fastest-growing brands are embracing the differentiated TTEC value
proposition."
FIRST QUARTER 2021 FINANCIAL
HIGHLIGHTS
Revenue
- First quarter 2021 GAAP revenue increased 24.8 percent to
$539.2 million compared to
$432.2 million in the prior year
period.
- Foreign exchange had a $7.1
million positive impact on revenue in the first quarter
2021.
Income from Operations
- First quarter 2021 GAAP income from operations was $73.4 million, or 13.6 percent of revenue,
compared to $40.7 million, or 9.4
percent of revenue in the prior year period.
- Non-GAAP income from operations, excluding restructuring and
impairment charges, equity-based compensation expenses,
amortization of purchased intangibles, and other items, was
$79.9 million or 14.8 percent of
revenue versus 11.3 percent for the prior year period.
- Foreign exchange had a $1.0
million positive impact on income from operations in the
first quarter 2021.
Adjusted
EBITDA
- First quarter 2021 Non-GAAP Adjusted EBITDA was $95.9 million, or 17.8 percent of revenue,
compared to $63.6 million, or 14.7
percent of revenue in the prior year period.
Earnings Per Share
- First quarter 2021 GAAP fully diluted earnings per share was
$1.06 compared to $0.46 for the same period last year.
- Non-GAAP fully diluted earnings per share was $1.26 compared to $0.74 in the prior year period.
Bookings
- During the first quarter 2021, TTEC signed an estimated
$170 million in annualized contract
value compared to $87 million in the
prior year period. First quarter bookings mix was diversified
across segments, verticals, and geographies.
STRONG CASH FLOW AND BALANCE SHEET FUND INVESTMENTS AND
DIVIDENDS
- Cash flow from operations in the first quarter 2021 was
$69.8 million compared to
$62.2 million for the first
quarter 2020.
- Capital expenditures in the first quarter 2021 were
$11.6 million compared to
$16.8 million for the first
quarter 2020.
- As of March 31, 2021, TTEC had
cash and cash equivalents of $144.2
million and debt of $348.7 million, resulting in a net debt
position of $204.5 million. This
compares to a net debt position of $195.2
million for the same period 2020.
- As of March 31, 2021, TTEC had
approximately $855 million of
additional borrowing capacity available under its credit facility
compared to $195 million for the same
period 2020. The increased capacity is primarily due to an
amendment to the credit facility on March
25, 2021 to increase the total commitments by
$300 million to $1.2 billion and a reduction in
year-over-year borrowings from excess cash on hand that was
previously maintained in response to the onset of the COVID-19
pandemic. In addition to cash flow from operations, the credit
facility provides TTEC with sufficient financial capacity and
flexibility to support working capital as well as growth-oriented
investments, strategic acquisitions, and discretionary capital
distributions. In April 2021, the
company borrowed approximately $500
million under the credit facility to provide funding for the
acquisition of Avtex Solutions Holdings, LLC.
- Paid a $0.43 per share, or
$20.1 million, semi-annual dividend
on April 21, 2021, an approximate 7.5
percent increase over the semi-annual dividend paid in October 2020 and a 26.5 percent increase
over the April 2020 dividend.
SEGMENT REPORTING & COMMENTARY
TTEC reports financial results for the following two business
segments: TTEC Digital (Digital) and
TTEC Engage (Engage). Financial highlights for the two
segments are provided below.
TTEC Digital – Design, build and operate tech-enabled,
insight-driven CX solutions
- First quarter 2021 GAAP revenue for TTEC Digital decreased 18.0
percent to $63.6 million from
$77.6 million for the year ago
period. Income from operations was $4.2
million or 6.6 percent of revenue compared to operating
income of $10.3 million or 13.2
percent of revenue for the prior year period.
- Non-GAAP income from operations was $6.7
million, or 10.5 percent of revenue compared to operating
income of $12.6 million or 16.2
percent of revenue in the prior year period.
- Foreign exchange had a $0.6
million positive impact on revenue and negligible impact on
income from operations.
TTEC Engage – Digitally-enabled customer care, acquisition,
and fraud prevention services
- First quarter 2021 GAAP revenue for TTEC Engage increased 34.1
percent to $475.6 million from
$354.7 million for the year ago
period. Income from operations was $69.2
million or 14.6 percent of revenue compared to operating
income of $30.5 million or 8.6
percent of revenue for the prior year period.
- Non-GAAP income from operations was $73.2 million, or 15.4 percent of revenue
compared to operating income of $36.2
million or 10.2 percent of revenue in the prior year
period.
- Foreign exchange had a $6.5
million positive impact on revenue and $1.0 million positive impact on income from
operations.
BUSINESS OUTLOOK
"2021 is off to a strong start with record first quarter top and
bottom-line financial results exceeding our plan," commented
Regina Paolillo, chief financial and administrative officer.
We are well positioned for strong profitable growth in 2021
supported by elevated levels of bookings, pipeline and revenue
backlog and further evidenced by the increase in our full-year
outlook. Our go-to-market platform is accelerating the adoption of
our differentiated CX solutions and we continue to augment our
organic growth with meaningful accretive strategic
acquisitions."
Paolillo continued, "Undeniably, the strategic investments that
we have made over the years and the level of execution we are
experiencing has transformed our company, increased our value
proposition in the marketplace, and changed the financial profile
and trajectory of the business. We have a high degree of confidence
in our enhanced 2021 outlook, including the revenue and
profitability split between first and second half of the year."
Our raised full-year 2021 outlook, including Avtex, is as
follows:
Revenue between $2.191
and $2.221 billion, an increase of
12.4 and 14.0 percent over the prior year.
Non-GAAP Operating Income margins between 12.0 and
12.4 percent.
- Margin of approximately 14.1 percent for TTEC Digital and 11.8
percent for TTEC Engage
Non-GAAP Adjusted EBITDA margins between 15.0 and
15.3 percent.
- Margin of approximately 17.3 percent for TTEC Digital and 14.7
percent for TTEC Engage
Non-GAAP Earnings Per Share between $4.14 and $4.32.
Capital expenditures are estimated to between 3.1
and 3.3 percent of revenue, of which approximately 60 percent is
growth oriented.
Effective tax rate for the full year is estimated
between 22 and 24 percent.
Diluted share count for the full year is estimated
between 47.2 and 47.6 million.
We estimate the first half - second half 2021 mix as
follows:
- Revenue: 49 percent first half, 51 percent second half
- Non-GAAP Operating Income: 52 percent first half, 48 percent
second half
- Non-GAAP Adjusted EBITDA: 52 percent first half, 48 percent
second half
- Non-GAAP Earnings Per Share: 53 percent first half, 47 percent
second half
We estimate the Digital - Engage 2021 mix as follows:
- Revenue: 18 percent Digital, 82 percent Engage, of which 42
percent of Digital and 50 percent of Engage in the first half,
respectively.
- Non-GAAP Operating Income: 20 percent Digital, 80 percent
Engage, of which 33 percent of Digital and 57 percent of Engage in
the first half, respectively.
- Adjusted EBITDA: 20 percent Digital, 80 percent Engage, of
which 36 percent of Digital and 56 percent of Engage in the first
half, respectively.
NON-GAAP FINANCIAL MEASURES
This press release contains a discussion of certain Non-GAAP
financial measures that the Company includes to allow investors and
analysts to measure, analyze and compare its financial condition
and results of operations in a meaningful and consistent manner. A
reconciliation of these Non-GAAP financial measures can be found in
the tables accompanying this press release.
- GAAP metrics are presented in accordance
with Generally Accepted Accounting Principles.
- Non-GAAP - As reflected in the attached reconciliation
table, the definition of Non-GAAP may exclude from operating
income, EBITDA, net income and earnings per share restructuring and
impairment charges, equity-based compensation expenses,
amortization of purchased intangibles, among other items.
ABOUT TTEC
TTEC Holdings, Inc. (NASDAQ: TTEC) is one of the largest,
global CX (customer experience) technology and services innovators
for end-to-end, digital CX solutions. The Company delivers
leading CX technology and operational CX orchestration
at scale through its proprietary cloud-based CXaaS (Customer
Experience as a Service) platform. Serving iconic and
disruptive brands, TTEC's outcome-based solutions span the
entire enterprise, touch every virtual interaction channel,
and improve each step of the customer journey. Leveraging next gen
digital and cognitive technology, the Company's Digital business
designs, builds, and operates omnichannel contact center
technology, conversational messaging, CRM, automation (AI / ML and
RPA), and analytics solutions. The Company's Engage business
delivers digital customer engagement, customer acquisition &
growth, content moderation, fraud prevention, and data annotation
solutions. Founded in 1982, the Company's singular
obsession with CX excellence has earned it leading client NPS
scores across the globe. The company's nearly 58,500 employees
operate on six continents and bring technology and humanity
together to deliver happy customers and differentiated business
results. To learn more visit us at https://www.ttec.com
FORWARD-LOOKING STATEMENTS
This earnings release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements are based on the current beliefs and
expectations of TTEC Holdings, Inc.'s management and are
subject to significant risks and uncertainties. We caution you not
to rely unduly on any forward-looking statements. Actual results
may differ materially from those expressed in the forward-looking
statements, and you should review and consider carefully the risks,
uncertainties and other factors that affect our business and may
cause such differences as outlined in Item 1A. Risk Factors in our
Annual Report on Form 10-K for the year ended December 31, 2020 and any subsequent filings with
the U.S. Securities and Exchange Commission (the "SEC") and is
available on TTEC's website www.ttec.com, and on the SEC's public
website at www.sec.gov. Specifically, important factors that
could cause our actual results to differ materially from those
indicated in the forward looking statements include, among others,
are risks related to our business operations and strategy,
including our strategy execution in a competitive market; our
ability to innovate and introduce technologies that are
sufficiently disruptive to allow us to maintain and grow our market
share; our dependance on 3rd parties for our cloud
solutions; the impact of COVID-19 on our business and our clients'
business; risks inherent in our rapid transition to a work from
home environment; our ability to attract and retain qualified and
skilled personnel at a price point that we can afford and our
clients are willing to pay; our M&A activity, including our
ability to identify, acquire and properly integrate acquired
businesses in accordance with our strategy; the risks related to
our technology, including cybersecurity, the reliability of our
information technology infrastructure and our ability to
consistently deliver uninterrupted service to our clients; the risk
related to our international operations; the risks related to legal
impacts on our operations, in particular rapidly changing laws that
regulate our and our clients' business, such as data privacy and
data protection laws and healthcare, financial and public sector
specific regulations, our ability to comply with these laws timely,
and cost of wage and hour litigation in the United States; and risks inherent in our
equity structure including our controlling shareholder risk, and
Delaware choice of dispute
resolution risks. TTEC Holdings, Inc. does not undertake to update
any forward-looking statements.
|
|
|
|
|
|
TTEC HOLDINGS,
INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
March
31,
|
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
Revenue
|
|
$ 539,219
|
|
$ 432,213
|
|
|
|
|
|
|
Operating
Expenses:
|
|
|
|
|
|
Cost of
services
|
|
388,660
|
|
321,557
|
|
Selling, general and
administrative
|
|
52,757
|
|
49,834
|
|
Depreciation and
amortization
|
|
20,459
|
|
18,872
|
|
Restructuring and
integration charges, net
|
402
|
|
538
|
|
Impairment
losses
|
|
3,517
|
|
696
|
Total operating expenses
|
|
465,795
|
|
391,497
|
|
|
|
|
|
|
Income From
Operations
|
|
73,424
|
|
40,716
|
|
|
|
|
|
|
|
Other income
(expense), net
|
|
(2,421)
|
|
(5,832)
|
|
|
|
|
|
|
Income Before
Income Taxes
|
|
71,003
|
|
34,884
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
(15,979)
|
|
(10,199)
|
|
|
|
|
|
|
Net
Income
|
|
55,024
|
|
24,685
|
|
|
|
|
|
|
|
Net income
attributable to noncontrolling interest
|
(4,606)
|
|
(3,151)
|
|
|
|
|
|
|
Net Income
Attributable to TTEC Stockholders
|
$
50,418
|
|
$
21,534
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.18
|
|
$
0.53
|
|
|
|
|
|
|
|
Diluted
|
|
$
1.16
|
|
$
0.53
|
|
|
|
|
|
|
Net Income Per
Share Attributable to TTEC Stockholders
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.08
|
|
$
0.46
|
|
|
|
|
|
|
|
Diluted
|
|
$
1.06
|
|
$
0.46
|
|
|
|
|
|
|
|
|
|
|
|
|
Income From
Operations Margin
|
|
13.6%
|
|
9.4%
|
Net Income
Margin
|
|
10.2%
|
|
5.7%
|
Net Income
Attributable to TTEC Stockholders Margin
|
9.4%
|
|
5.0%
|
Effective Tax
Rate
|
|
22.5%
|
|
29.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares Outstanding
|
|
|
|
Basic
|
|
46,743
|
|
46,498
|
Diluted
|
|
47,355
|
|
46,813
|
TTEC HOLDINGS,
INC. AND SUBSIDIARIES
|
SEGMENT
INFORMATION
|
(In
thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
March
31,
|
|
|
2021
|
|
2020
|
|
|
|
|
|
Revenue:
|
|
|
|
|
TTEC
Digital
|
|
$
63,587
|
|
$
77,556
|
TTEC
Engage
|
|
475,632
|
|
354,657
|
Total
|
|
$
539,219
|
|
$
432,213
|
|
|
|
|
|
Income From
Operations:
|
|
|
|
|
TTEC
Digital
|
|
$
4,202
|
|
$
10,258
|
TTEC
Engage
|
|
69,222
|
|
30,458
|
Total
|
|
$
73,424
|
|
$
40,716
|
TTEC HOLDINGS,
INC. AND SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
(In
thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and
cash equivalents
|
|
$
144,213
|
|
$
132,914
|
Accounts
receivable, net
|
|
350,307
|
|
378,397
|
Other
current assets
|
|
169,338
|
|
145,491
|
Total current
assets
|
|
663,858
|
|
656,802
|
|
|
|
|
|
Property and
equipment, net
|
|
168,697
|
|
178,706
|
Other
assets
|
|
663,098
|
|
680,900
|
|
|
|
|
|
Total
assets
|
|
$
1,495,653
|
|
$
1,516,408
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Total current
liabilities
|
|
$
402,946
|
|
$
396,170
|
Other long-term
liabilities
|
|
557,792
|
|
609,500
|
Redeemable
noncontrolling interest
|
|
54,674
|
|
52,976
|
Total
equity
|
|
480,241
|
|
457,762
|
|
|
|
|
|
Total liabilities
and equity
|
|
$
1,495,653
|
|
$
1,516,408
|
TTEC HOLDINGS,
INC. AND SUBSIDIARIES
|
RECONCILIATION OF
NON-GAAP FINANCIAL INFORMATION
|
(In thousands,
except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
539,219
|
|
$
432,213
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
$
55,024
|
|
$
24,685
|
|
|
|
Interest
income
|
|
(179)
|
|
(364)
|
|
|
|
Interest
expense
|
|
1,802
|
|
9,592
|
|
|
|
Provision for income taxes
|
|
15,979
|
|
10,199
|
|
|
|
Depreciation and amortization
|
|
20,459
|
|
18,872
|
|
|
|
Asset
impairment, restructuring and integration charges
|
|
3,919
|
|
1,234
|
|
|
|
Gain on
sale of business units
|
|
-
|
|
(246)
|
|
|
|
Changes
in acquisition contingent consideration
|
|
877
|
|
(3,265)
|
|
|
|
Grant
income for pandemic relief
|
|
(6,032)
|
|
-
|
|
|
|
Equity-based compensation expenses
|
|
4,028
|
|
2,919
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
95,877
|
|
$
63,626
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Free Cash Flow:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flow From
Operating Activities:
|
|
|
|
|
|
|
|
Net
income
|
|
$
55,024
|
|
$
24,685
|
|
|
|
Adjustments to reconcile net income to net cash
|
|
|
|
|
|
|
|
provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
20,459
|
|
18,872
|
|
|
|
Other
|
|
(5,696)
|
|
18,608
|
|
|
|
Net cash
provided by operating activities
|
|
69,787
|
|
62,165
|
|
|
|
|
|
|
|
|
|
|
|
Less - Total Cash
Capital Expenditures
|
|
11,565
|
|
16,813
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash
Flow
|
|
$
58,222
|
|
$
45,352
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Non-GAAP Income from Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
Operations
|
|
$
73,424
|
|
$
40,716
|
|
|
|
Restructuring
charges, net
|
|
402
|
|
538
|
|
|
|
Impairment
losses
|
|
3,517
|
|
696
|
|
|
|
Grant
income for pandemic relief
|
|
(6,032)
|
|
-
|
|
|
|
Equity-based compensation expenses
|
|
4,028
|
|
2,919
|
|
|
|
Amortization of
purchased intangibles
|
|
4,515
|
|
3,877
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Income
from Operations
|
|
$
79,854
|
|
$
48,746
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Income
from Operations Margin
|
|
14.8%
|
|
11.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Non-GAAP EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
$
55,024
|
|
$
24,685
|
|
|
|
Add: Asset
restructuring and impairment charges
|
|
3,919
|
|
1,234
|
|
|
|
Add:
Equity-based compensation expenses
|
|
4,028
|
|
2,919
|
|
|
|
Add:
Amortization of purchased intangibles
|
|
4,515
|
|
3,877
|
|
|
|
Add: Interest
charge related to future purchase of remaining 30% for Motif
acquisition
|
|
-
|
|
6,477
|
|
|
|
Less: Changes
in acquisition contingent consideration
|
|
877
|
|
(3,265)
|
|
|
|
Less: Gain on
sale of business units
|
|
-
|
|
(246)
|
|
|
|
Less: Grant
income for pandemic relief
|
|
(6,032)
|
|
-
|
|
|
|
Less: Changes
in valuation allowance, return to provision adjustments and other,
and tax effects of items separately disclosed above
|
|
(2,605)
|
|
(853)
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net
Income
|
|
$
59,726
|
|
$
34,828
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares outstanding
|
|
47,355
|
|
46,813
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
EPS
|
|
$1.26
|
|
$0.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Adjusted EBITDA by Segment :
|
|
TTEC
Engage
|
|
TTEC
Digital
|
|
|
Q1
21
|
|
Q2
20
|
|
Q1
21
|
Q2
20
|
|
|
|
|
|
|
|
|
Earnings before
Income Taxes
|
|
$
66,762
|
|
$
24,582
|
|
$
4,241
|
$
10,302
|
Interest
income / expense, net
|
|
1,662
|
|
9,274
|
|
(39)
|
(45)
|
Depreciation and amortization
|
|
16,572
|
|
15,584
|
|
3,887
|
3,288
|
Asset
impairment, restructuring and integration charges
|
|
3,910
|
|
331
|
|
8
|
902
|
Gain on
sale of business units
|
|
-
|
|
(246)
|
|
-
|
-
|
Grant
income for pandemic relief
|
|
(6,032)
|
|
-
|
|
-
|
-
|
Changes
in acquisition contingent consideration
|
|
877
|
|
(3,265)
|
|
-
|
-
|
Equity-based compensation expenses
|
|
2,742
|
|
2,070
|
|
1,287
|
849
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
86,493
|
|
$
48,330
|
|
$
9,384
|
$
15,296
|
Investor Relations
Contact
Paul
Miller
+1.303.397.8641
|
Public Relations
Contact
Nick
Cerise
+1.303.397.8331
|
Address
9197 South Peoria
Street
Englewood, CO
80112
|
Contact
ttec.com
+1.800.835.3832
|
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SOURCE TTEC Holdings, Inc.