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TTEC Announces Third Quarter 2023 Financial Results

Third Quarter 2023

Revenue was $603.0 Million, up 1.8 Percent Year-over-Year
Operating Income was $25.4 Million or 4.2 Percent of Revenue
(Non-GAAP Operating Income was $47.3 Million or 7.8 Percent of Revenue)
Net Income was $1.8 Million or 0.3 Percent of Revenue
(Non-GAAP Net Income was $22.9 Million or 3.8 Percent of Revenue)
Adjusted EBITDA was $63.9 Million or 10.6 Percent of Revenue
Fully Diluted EPS was $0.04 (Non-GAAP EPS was $0.48)

Updates Outlook for Full Year 2023

DENVER , Nov. 8, 2023 /PRNewswire/ -- TTEC Holdings, Inc. ( NASDAQ: TTEC), a leading global CX (customer experience) technology and services innovator for AI-enabled CX with solutions from TTEC Engage and TTEC Digital, announced today financial results for the third quarter ended September 30, 2023.

"We delivered against our third quarter plan and continued to support our clients' strategic CX priorities," commented Ken Tuchman, chairman and chief executive officer of TTEC. "However, given the dynamic macroeconomic environment and impact from a select number of our clients, we are moderating our financial outlook for the remainder of the year."

"We remain keenly focused on delivering high quality services and the leading CX technology solutions for our clients while optimizing costs in our business," Tuchman added. "As we navigate these uncertainties, we remain confident in the attractiveness of the market opportunity, the strength of our client and partner relationships, the dedication of our employees, and our strategy to drive our business forward."

THIRD QUARTER 2023 FINANCIAL HIGHLIGHTS

Revenue

  • Third quarter 2023 GAAP revenue increased 1.8 percent to $603.0 million compared to $592.5 million in the prior year period.
  • Foreign exchange had a $6.0 million positive impact on revenue in the third quarter of 2023.

Income from Operations

  • Third quarter 2023 GAAP income from operations was $25.4 million, or 4.2 percent of revenue, compared to $35.6 million, or 6.0 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 $47.3 million, or 7.8 percent of revenue, compared to $50.2 million, or 8.5 percent for the prior year period.
  • Foreign exchange had a $1.0 million negative impact on Non-GAAP income from operations in the third quarter of 2023.

Adjusted EBITDA

  • Third quarter 2023 Non-GAAP Adjusted EBITDA was $63.9 million, or 10.6 percent of revenue, compared to $68.5 million, or 11.6 percent of revenue in the prior year period.

Earnings Per Share

  • Third quarter 2023 GAAP fully diluted earnings per share was $0.04 compared to $0.53 for the same period last year.
  • Non-GAAP fully diluted earnings per share was $0.48 compared to $0.68 in the prior year period.

CASH FLOW AND BALANCE SHEET FUND INVESTMENTS AND DIVIDENDS

  • Cash flow from operations in the third quarter of 2023 was negative $31.7 million compared to a positive $27.5 million for the third quarter 2022.
  • Capital expenditures in the third quarter 2023 were $21.8 million compared to $28.8 million for the third quarter 2022.
  • As of September 30, 2023, TTEC had cash and cash equivalents of $151.6 million and debt of $967.3 million, resulting in a net debt position of $815.7 million. This compares to a net debt position of $787.0 million for the same period 2022. The increase in net debt is primarily attributable to capital distributions and acquisition-related investments, partially offset by positive cash flow from operations.
  • As of September 30, 2023, TTEC's remaining borrowing capacity under its revolving credit facility was approximately $215 million compared to $370 million for the same period 2022.
  • TTEC paid a $0.52 per share, or $24.7 million, semi-annual dividend on October 31, 2023, to shareholders of record on October 16, 2023. This rate of dividend has remained unchanged since the company paid the dividend in October 2022.

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

  • Third quarter 2023 GAAP revenue for TTEC Digital increased 14.7 percent to $133.3 million from $116.2 million for the year ago period. Income from operations was $11.9 million or 8.9 percent of revenue compared to operating income of $8.0 million or 6.9 percent of revenue for the prior year period.
  • Non-GAAP income from operations was $19.4 million, or 14.5 percent of revenue compared to operating income of $15.8 million or 13.6 percent of revenue in the prior year period.

TTEC Engage – Digitally-enabled customer care, acquisition, and fraud mitigation services

  • Third quarter 2023 GAAP revenue for TTEC Engage decreased 1.4 percent to $469.7 million from $476.3 million for the year ago period. Income from operations was $13.5 million or 2.9 percent of revenue compared to operating income of $27.6 million, or 5.8 percent of revenue for the prior year period.
  • Non-GAAP income from operations was $27.9 million, or 5.9 percent of revenue, compared to operating income of $34.5 million, or 7.2 percent of revenue in the prior year period.
  • Foreign exchange had a $5.8 million positive impact on revenue and $1.0 million negative impact on Non-GAAP income from operations.

BUSINESS OUTLOOK

"We continue to view the long-term fundamentals of our business and the value proposition we provide as exceptionally durable. However, the rapidly changing macroeconomic uncertainties impacted a number of our clients and in turn put downward pressure on our fourth quarter financial outlook. As a result, we updated our full year guidance," commented Francois Bourret, interim chief financial officer of TTEC.

Bourret continued, "As we are pivoting to 2024, we remain focused on our strategic priorities that deliver improved profitable growth. We look forward to providing our full-year 2024 outlook when we announce our fourth quarter earnings results at the end of February."

TTEC Full Year 2023 Outlook

   
   

Full Year 2023
Guidance

Revenue

 

$2,433M$2,453M

Non-GAAP adjusted EBITDA

 

$270M$280M

Non-GAAP adjusted EBITDA margins

 

11.1% — 11.4%

Non-GAAP operating income

 

$198M$208M

Non-GAAP operating income margins

 

8.1% — 8.5%

Interest expense, net

 

($73M) — ($75M)

Non-GAAP adjusted tax rate

 

23% — 25%

Diluted share count

 

47.4M — 47.6M

Non-GAAP earnings per a share

 

$2.11$2.27

     
     

Engage Full Year 2023 outlook

   
   

Full Year 2023
Guidance

Revenue

 

$1,950M$1,966M

Non-GAAP adjusted EBITDA

 

$198M$206M

Non-GAAP adjusted EBITDA margins

 

10.2% — 10.5%

Non-GAAP operating income

 

$136M$144M

Non-GAAP operating income margins

 

7.0% — 7.3%

     
     

Digital Full Year 2023 outlook

   
   

Full Year 2023
Guidance

Revenue

 

$483M$487M

Non-GAAP adjusted EBITDA

 

$72M$74M

Non-GAAP adjusted EBITDA margins

 

14.9% — 15.2%

Non-GAAP operating income

 

$62M$64M

Non-GAAP operating income margins

 

12.8% — 13.1%

The Company has not quantitatively reconciled its guidance for Non-GAAP operating income, Non-GAAP operating income margins, Non-GAAP adjusted EBITDA, Non-GAAP adjusted EBITDA margins, or Non-GAAP earnings per share to their respective most comparable GAAP measures because certain of the reconciling items that impact these metrics, including restructuring and impairment charges, equity-based compensation expense, changes in acquisition contingent consideration, depreciation and amortization expense, and provision for income taxes are dependent on the timing of future events outside of the Company's control or cannot be reliably predicted. Accordingly, the Company is unable to provide reconciliations to GAAP operating income, operating income margins, EBITDA margins, and diluted earnings per share without unreasonable effort. Please note that the unavailable reconciling items could significantly impact the Company's 2023 financial results as reported under GAAP.

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 a leading global CX (customer experience) technology and services innovator for AI-enabled CX with solutions from TTEC Engage and TTEC Digital. 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 and 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 64,400 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 Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995, relating to our operations, expected financial position, results of operation, and other business matters that are based on our current expectations, assumptions, and projections with respect to the future, and are not a guarantee of performance. In this release when we use words such as "may," "believe," "plan," "will," "anticipate," "estimate," "expect," "intend," "project," "would," "could," "target," or similar expressions, or when we discuss our strategy, plans, goals, initiatives, or objectives, we are making forward-looking statements.

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, 2022 and any subsequent filings with the U.S. Securities and Exchange Commission (the "SEC") which are available on TTEC's website www.ttec.com, and on the SEC's public website at www.sec.gov. Important factors that could cause our actual results to differ materially from those indicated in the forward looking statements include, among others: the risks related to our business operations and strategy in a competitive market; our ability to innovate and introduce disruptive technologies that would allow us to maintain and grow our market share (e.g., effective adoption of artificial intelligence into our solutions); risks that may arise in connection with events outside of our control (e.g., macroeconomic conditions, geopolitical tensions, outbreaks of infectious diseases); risks inherent in a disruption and cybersecurity of our information technology systems, including as a result of criminal or other unauthorized activity, which can impact our ability to consistently deliver uninterrupted service to our clients or unauthorized access to data, any of which may result in government investigations and enforcement actions, and private legal actions; risks inherent in the delivery of services by employees working from home; our ability to attract and retain qualified personnel at a price point that we can afford and our clients are willing to pay; our M&A activity, including our ability to properly integrate acquired businesses; our reliance on a relatively small number of TTEC Engage clients to generate the majority of our revenue and our reliance on technology partners to generate a large portion of TTEC Digital's revenue; the changes in laws and regulations that impact our and our clients' businesses, including rapidly changing data privacy and data protection laws, healthcare business regulations, and financial and public sector specific regulations; the cost of labor and data privacy litigation and other class action litigation; the risks related to our international operations including the stress that geographic expansion may have on our business, the impact if we are unable to expand geographically to meet our clients' demand or our clients' reluctance to expand the delivery of their services in certain parts of the world due to conflict or other disruptions; and risks inherent in our equity structure including our controlling shareholder risk, and Delaware choice of dispute resolution risks.

Our forward-looking statements speak only as of the date that this release is issued. We undertake no obligation to update them, except as may be required by applicable law. Although we believe that our forward-looking statements are reasonable, they depend on many factors outside of our control and we can provide no assurance that they will prove to be correct.

Investor Relations Contact

Paul Miller

+1.303.397.8641

Address

6312 S Fiddler's Green Circle, 100N

Greenwood Village, CO 80111

Communications Contact

Tim Blair

tim.blair@ttec.com

+1.303.397.9267

 

                   

TTEC HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(unaudited)

                   
                   
     

Three months ended

 

Nine months ended

     

September 30,

 

September 30,

     

2023

 

2022

 

2023

 

2022

                   

Revenue

 

$ 602,956

 

$ 592,453

 

$ 1,836,636

 

$ 1,785,429

                   

Operating Expenses:

               
 

Cost of services

 

479,699

 

450,454

 

1,427,063

 

1,361,179

 

Selling, general and administrative

 

66,781

 

75,226

 

216,129

 

206,831

 

Depreciation and amortization

 

25,595

 

27,117

 

76,368

 

80,061

 

Restructuring charges, net

 

1,369

 

1,113

 

4,896

 

4,261

 

Impairment losses

 

4,124

 

2,939

 

11,083

 

13,299

Total operating expenses

 

577,568

 

556,849

 

1,735,539

 

1,665,631

                   

Income From Operations

 

25,388

 

35,604

 

101,097

 

119,798

                   
 

Other income (expense), net

 

(18,298)

 

(6,100)

 

(55,309)

 

(8,218)

                   

Income Before Income Taxes

 

7,090

 

29,504

 

45,788

 

111,580

                   
 

Provision for income taxes

 

(5,294)

 

(4,489)

 

(19,318)

 

(19,797)

                   

Net Income

 

1,796

 

25,015

 

26,470

 

91,783

                   
 

Net income attributable to noncontrolling interest

(3,326)

 

(2,766)

 

(8,142)

 

(10,896)

                   

Net (Loss) / Income Attributable to TTEC Stockholders

$ (1,530)

 

$ 22,249

 

$ 18,328

 

$ 80,887

                   
                   

Net Income Per Share

               
                   
 

Basic

 

$ 0.04

 

$ 0.53

 

$ 0.56

 

$ 1.95

                   
 

Diluted

 

$ 0.04

 

$ 0.53

 

$ 0.56

 

$ 1.94

                   

Net (Loss) / Income Per Share Attributable to TTEC Stockholders

             
                   
 

Basic

 

$ (0.03)

 

$ 0.47

 

$ 0.39

 

$ 1.72

                   
 

Diluted

 

$ (0.03)

 

$ 0.47

 

$ 0.39

 

$ 1.71

                   
                   

Income From Operations Margin

 

4.2 %

 

6.0 %

 

5.5 %

 

6.7 %

Net Income Margin

 

0.3 %

 

4.2 %

 

1.4 %

 

5.1 %

Net (Loss) / Income Attributable to TTEC Stockholders Margin

(0.3) %

 

3.8 %

 

1.0 %

 

4.5 %

Effective Tax Rate

 

74.7 %

 

15.2 %

 

42.2 %

 

17.7 %

                   
                   

Weighted Average Shares Outstanding

               

Basic

 

47,415

 

47,207

 

47,305

 

47,087

Diluted

 

47,488

 

47,314

 

47,417

 

47,354

 

TTEC HOLDINGS, INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(In thousands)

(unaudited)

                 
                 
   

Three months ended

 

Nine months ended

   

September 30,

 

September 30,

   

2023

 

2022

 

2023

 

2022

                 

Revenue:

               

TTEC Digital

 

$ 133,252

 

$ 116,173

 

$ 367,764

 

$ 342,020

TTEC Engage

 

469,704

 

476,280

 

1,468,872

 

1,443,409

Total

 

$ 602,956

 

$ 592,453

 

$ 1,836,636

 

$ 1,785,429

                 

Income From Operations:

               

TTEC Digital

 

$ 11,925

 

$ 8,015

 

$ 19,864

 

$ 24,971

TTEC Engage

 

13,463

 

27,589

 

81,233

 

94,827

Total

 

$ 25,388

 

$ 35,604

 

$ 101,097

 

$ 119,798

 

TTEC HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)

         
   

September 30,

 

December 31,

   

2023

 

2022

         

ASSETS

       

Current assets:

       

Cash and cash equivalents

 

$ 151,583

 

$ 153,435

Accounts receivable, net

 

379,755

 

417,637

Prepaid and other current assets

 

118,956

 

133,365

Income and other tax receivables

 

11,832

 

45,533

Total current assets

 

662,126

 

749,970

         

Property and equipment, net

 

192,554

 

183,360

Operating lease assets

 

119,544

 

92,431

Goodwill

 

806,400

 

807,845

Other intangibles assets, net

 

206,800

 

233,909

Income and other tax receivables, long term

 

39,595

 

-

Other assets

 

141,171

 

86,447

         

Total assets

 

$ 2,168,190

 

$ 2,153,962

         

LIABILITIES AND EQUITY

       

Current liabilities:

       

Accounts payable

 

$ 105,519

 

$ 93,937

Accrued employee compensation and benefits

 

128,731

 

145,096

Deferred revenue

 

82,529

 

87,846

Current operating lease liabilities

 

37,297

 

35,271

Other current liabilities

 

68,721

 

49,214

Total current liabilities

 

422,797

 

411,364

         

Long-term liabilities:

       

Line of credit

 

964,000

 

960,000

Non-current operating lease liabilities

 

97,899

 

69,575

Other long-term liabilities

 

76,009

 

79,273

Total long-term liabilities

 

1,137,908

 

1,108,848

         

Redeemable noncontrolling interest

 

4,310

 

55,645

         

Equity:

       

Common stock

 

474

 

472

Additional Paid in Capital

 

398,384

 

367,673

Treasury stock

 

(589,948)

 

(593,164)

Accumulated other comprehensive income (loss)

 

(103,039)

 

(126,301)

Retained earnings

 

880,328

 

911,233

Noncontrolling interest

 

16,976

 

18,192

Total equity

 

603,175

 

578,105

         

Total liabilities and equity

 

$ 2,168,190

 

$ 2,153,962

 

TTEC HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

       
 

Nine months ended

 

Nine months ended

 

September 30,

 

September 30,

 

2023

 

2022

       

Cash flows from operating activities:

     

Net income

$ 26,470

 

$ 91,783

Adjustment to reconcile net income to net cash provided by operating activities :

     

Depreciation and amortization

76,368

 

80,061

Amortization of contract acquisition costs

1,596

 

1,345

Amortization of debt issuance costs

801

 

735

Imputed interest expense and fair value adjustments to contingent consideration

6,864

 

2,070

Provision for credit losses

1,677

 

1,561

Loss on disposal of assets

1,176

 

1,587

Impairment losses

11,083

 

13,299

Loss on dissolution of subsidiary

301

 

-

Deferred income taxes

(12,288)

 

(8,216)

Excess tax benefit from equity-based awards

1,807

 

(1,256)

Equity-based compensation expense

16,410

 

13,240

Loss / (gain) on foreign currency derivatives

552

 

269

Changes in assets and liabilities, net of acquisitions:

     

Accounts receivable

34,995

 

(37,987)

Prepaids and other assets

(1,620)

 

38,594

Accounts payable and accrued expenses

(8,453)

 

1,483

Deferred revenue and other liabilities

(44,508)

 

(79,755)

Net cash provided by operating activities

113,231

 

118,813

       

Cash flows from investing activities:

     

Proceeds from sale of property, plant and equipment

246

 

189

Purchases of property, plant and equipment

(54,722)

 

(64,564)

Acquisitions

-

 

(142,420)

Net cash used in investing activities

(54,476)

 

(206,795)

       

Cash flows from financing activities:

     

Proceeds from / (Repayments of) line of credit, net

4,000

 

164,000

Payments on other debt

(1,929)

 

(2,568)

Payments of contingent consideration and hold back payments to acquisitions

(37,676)

 

(9,600)

Dividends paid to shareholders

(24,572)

 

(23,518)

Payments to noncontrolling interest

(8,407)

 

(9,562)

Tax payments related to the issuance of restricted stock units

(2,938)

 

(6,980)

Net cash (used in) / provided by financing activities

(71,522)

 

111,772

       

Effect of exchange rate changes on cash and cash equivalents and restricted cash

3,889

 

(22,226)

       

(Decrease) / Increase in cash, cash equivalents and restricted cash

(8,878)

 

1,564

Cash, cash equivalents and restricted cash, beginning of period

167,064

 

180,682

Cash, cash equivalents and restricted cash, end of period

$ 158,186

 

$ 182,246

 

TTEC HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION

(In thousands, except per share data)

(unaudited)

                             
   

Three months ended

       

Nine months ended

     
   

September 30,

       

September 30,

     
   

2023

 

2022

       

2023

 

2022

     
                             

Revenue

 

$ 602,956

 

$ 592,453

       

$ 1,836,636

 

$ 1,785,429

     
                             

Reconciliation of Non-GAAP Income from Operations and EBITDA:

                           
                             

Income from Operations

 

$ 25,388

 

$ 35,604

       

$ 101,097

 

$ 119,798

     

Restructuring charges, net

 

1,369

 

1,113

       

4,896

 

4,261

     

Impairment losses

 

4,124

 

2,939

       

11,083

 

13,299

     

Cybersecurity incident related impact, net of insurance recovery

 

-

 

(6,833)

       

(3,210)

 

(3,164)

     

Software accelerated amortization

 

-

 

2,127

       

-

 

2,127

     

Write-off of acquisition related receivable

 

-

 

900

       

-

 

900

     

Property costs not related to operations

 

744

 

-

       

744

 

-

     

Grant income for pandemic relief

 

-

 

-

       

40

 

-

     

Change in acquisition related obligation

 

-

 

-

       

483

 

-

     

Equity-based compensation expenses

 

6,608

 

5,357

       

16,410

 

13,239

     

Amortization of purchased intangibles

 

9,073

 

9,041

       

27,083

 

28,131

     
                             

Non-GAAP Income from Operations

 

$ 47,306

 

$ 50,248

       

$ 158,626

 

$ 178,591

     
                             

Non-GAAP Income from Operations Margin

 

7.8 %

 

8.5 %

       

8.6 %

 

10.0 %

     
                             

Depreciation and amortization

 

16,183

 

15,949

       

48,946

 

49,803

     

Changes in acquisition contingent consideration

 

102

 

2,070

       

6,864

 

2,070

     

Change in escrow balance related to acquisition

 

-

 

-

       

625

 

-

     

Loss on dissolution of subsidiary

 

-

 

-

       

301

 

-

     

Foreign exchange loss / (gain), net

 

(373)

 

(3,708)

       

839

 

(8,224)

     

Other Income (expense), net

 

687

 

3,946

       

(2,232)

 

11,317

     
                             

Adjusted EBITDA

 

$ 63,905

 

$ 68,505

       

$ 213,969

 

$ 233,557

     
                             

Adjusted EBITDA Margin

 

10.6 %

 

11.6 %

       

11.7 %

 

13.1 %

     
                             

Reconciliation of Non-GAAP EPS:

                           
                             

Net Income

 

$ 1,796

 

$ 25,015

       

$ 26,470

 

$ 91,783

     

Add: Asset impairment and restructuring charges

 

5,493

 

4,052

       

15,979

 

17,560

     

Add: Equity-based compensation expenses

 

6,608

 

5,357

       

16,410

 

13,239

     

Add: Amortization of purchased intangibles

 

9,073

 

9,041

       

27,083

 

28,131

     

Add: Cybersecurity incident related impact, net of insurance recovery

 

-

 

(6,833)

       

(3,210)

 

(3,164)

     

Add: Software accelerated amortization

 

-

 

2,127

       

-

 

2,127

     

Add: Write-off of acquisition related receivable

 

-

 

900

       

-

 

900

     

Add: Property costs not related to operations

 

744

 

-

       

744

 

-

     

Add: Grant income for pandemic relief

 

-

 

-

       

40

 

-

     

Add: Change in acquisition related obligation

 

-

 

-

       

483

 

-

     

Add: Changes in acquisition contingent consideration

 

102

 

2,070

       

6,864

 

2,070

     

Add: Changes in escrow balance related to acquisition

 

-

 

-

       

625

 

-

     

Add: Loss on dissolution of subsidiary

 

-

 

-

       

301

 

-

     

Add: Foreign exchange loss / (gain), net

 

(373)

 

(3,708)

       

839

 

(8,224)

     

Less: Changes in valuation allowance, return to provision adjustments and
other, and tax effects of items separately disclosed above

 

(590)

 

(5,787)

       

(6,974)

 

(17,963)

     
                             

Non-GAAP Net Income

 

$ 22,853

 

$ 32,234

       

$ 85,654

 

$ 126,459

     
                             

Diluted shares outstanding

 

47,488

 

47,314

       

47,417

 

47,354

     
                             

Non-GAAP EPS

 

$0.48

 

$0.68

       

$1.81

 

$2.67

     
                             

Reconciliation of Free Cash Flow:

                           
                             

Cash Flow From Operating Activities:

                           

Net income

 

$ 1,321

 

$ 25,015

       

$ 25,995

 

$ 91,783

     

Adjustments to reconcile net income to net cash provided by operating activities:

                           

Depreciation and amortization

 

25,256

 

27,117

       

76,029

 

80,061

     

Other

 

(58,295)

 

(24,591)

       

11,207

 

(53,031)

     

Net cash (used in) / provided by operating activities

 

(31,718)

 

27,541

       

113,231

 

118,813

     
                             

Less - Total Cash Capital Expenditures

 

21,768

 

28,774

       

54,722

 

64,564

     
                             

Free Cash Flow

 

$ (53,486)

 

$ (1,233)

       

$ 58,509

 

$ 54,249

     
                             
                             

Reconciliation of Non-GAAP Income from Operations and Adjusted EBITDA by Segment :

                       
   

TTEC Engage

 

TTEC Digital

 

TTEC Engage

 

TTEC Digital

   

Q3 23

 

Q3 22

 

Q3 23

Q2 22

 

YTD 23

 

YTD 22

 

YTD 23

YTD 22

                             

Income from Operations

 

$ 13,463

 

$ 27,644

 

$ 11,925

$ 7,960

 

$ 81,233

 

$ 94,882

 

$ 19,864

$ 24,916

Restructuring charges, net

 

634

 

1,086

 

735

27

 

2,427

 

4,121

 

2,469

140

Impairment losses

 

4,124

 

2,728

 

-

211

 

8,229

 

13,088

 

2,854

211

Cybersecurity incident related impact, net of insurance recovery

 

-

 

(6,833)

 

-

-

 

(3,210)

 

(3,164)

 

-

-

Software accelerated amortization

 

-

 

1,702

 

-

425

 

-

 

1,702

 

-

425

Write-off of acquisition related receivable

 

-

 

-

 

-

900

 

-

 

-

 

-

900

Property costs not related to operations

 

744

 

-

   

-

 

744

 

-

   

-

Grant income for pandemic relief

 

-

 

-

 

-

-

 

40

 

-

 

-

-

Change in acquisition related obligation

 

-

 

-

 

-

-

 

-

 

-

 

483

-

Equity-based compensation expenses

 

4,327

 

3,530

 

2,281

1,827

 

10,599

 

8,816

 

5,811

4,423

Amortization of purchased intangibles

 

4,649

 

4,615

 

4,424

4,426

 

13,951

 

12,614

 

13,132

15,517

                             

Non-GAAP Income from Operations

 

$ 27,941

 

$ 34,472

 

$ 19,365

$ 15,776

 

$ 114,013

 

$ 132,059

 

$ 44,613

$ 46,532

                             

Depreciation and amortization

 

13,807

 

13,194

 

2,377

2,755

 

41,695

 

40,894

 

7,252

8,910

Changes in acquisition contingent consideration

 

102

 

2,070

 

-

-

 

6,864

 

2,070

 

-

-

Change in escrow balance related to acquisition

 

-

 

-

 

-

-

 

625

 

-

 

-

-

Loss on dissolution of subsidiary

 

-

 

-

 

-

-

 

301

 

-

 

-

-

Foreign exchange loss / (gain), net

 

(297)

 

(3,064)

 

(76)

(644)

 

815

 

(7,146)

 

24

(1,078)

Other Income (expense), net

 

578

 

3,321

 

108

625

 

(2,332)

 

10,415

 

99

902

                             

Adjusted EBITDA

 

$ 42,131

 

$ 49,993

 

$ 21,774

$ 18,512

 

$ 161,981

 

$ 178,292

 

$ 51,988

$ 55,266