Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- IBEX Ltd (IBEX, Financial) achieved record first quarter revenue of $129.7 million, marking a 4.1% increase from the previous year.
- The company reported a record adjusted EPS of 52 cents, up 30% from 40 cents a year ago.
- IBEX Ltd (IBEX) expanded its adjusted EBITDA margin for the ninth time in the last 10 quarters, reaching 12%.
- The company successfully launched three new client relationships, including a significant win with a major e-commerce company.
- IBEX Ltd (IBEX) was recognized as number two for America's best employers for tech workers by Fortune Magazine.
Negative Points
- The fintech vertical experienced a revenue decline of 13%, impacting overall growth.
- Net cash generated from operating activities decreased slightly to $7.8 million from $8.7 million in the prior year quarter.
- The company's DSO increased to 75 days from 72 days, indicating slower collections.
- Free cash flow decreased to $4.1 million from $6.6 million in the prior quarter due to increased capital expenditures.
- The onshore region's revenue contribution decreased to 24% from 25% in the prior year quarter, reflecting a shift to offshore and nearshore operations.
Q & A Highlights
Q: Can you explain the recent inflection in revenue growth, given the previous flat to down trend over the past few quarters? Is this due to an improved macro environment or new client signings?
A: Robert Dechant, CEO, explained that the growth was driven by scaling new logos won in FY24 and market share gains in top clients. While the macro environment remains choppy, the company is optimistic about maintaining momentum through continued client wins and market share expansion.
Q: Health tech showed significant growth this quarter. Was this due to new client additions or existing client expansion?
A: Robert Dechant, CEO, noted that growth in health tech was due to both new logo wins and increased market share from existing clients. The company has been outperforming competitors, leading to additional business from current clients.
Q: With a 4% revenue growth in Q1, is there potential to maintain mid-single-digit growth throughout the year, despite the full-year guidance of 1-3%?
A: Robert Dechant, CEO, expressed hope to maintain growth momentum, driven by new client signings and market share gains. However, the company remains cautious due to potential macroeconomic headwinds, leading to conservative guidance.
Q: What factors contributed to the improvement in adjusted EBITDA margin this quarter?
A: Taylor Greenwald, CFO, attributed the 100 basis point improvement in adjusted EBITDA margin to growth in higher-margin offshore locations, site optimization efforts, and leverage from revenue growth.
Q: How is the company managing its client diversification, and what impact does this have on revenue?
A: Taylor Greenwald, CFO, highlighted that client diversification efforts have been successful, with the largest client accounting for only 11% of revenue. This diversification reduces risk and supports stable revenue growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
