TTEC Announces Fourth Quarter and Full Year 2023 Financial Results
Full Year 2023
Revenue was $2.463 Billion, up 0.8 Percent
Operating Income was $118.0 Million or 4.8 Percent of Revenue
($200.4 Million or 8.1 Percent of Revenue Non-GAAP)
Net Income was $18.3 Million or 0.7 Percent of Revenue
($103.2 Million or 4.2 Percent of Revenue Non-GAAP)
Adjusted EBITDA was $271.5 Million or 11.0 Percent of Revenue
Fully Diluted EPS was $0.39, $2.18 Non-GAAP
Fourth Quarter 2023
Revenue was $626.2 Million, down 4.9 Percent
Operating Income was 16.9 Million or 2.7 Percent of Revenue
($41.8 Million or 6.7 Percent of Revenue Non-GAAP)
Net Income was ($8.2) Million or (1.3) Percent of Revenue
($17.5 Million or 2.8 Percent of Revenue Non-GAAP)
Adjusted EBITDA was $57.5 Million or 9.2 Percent of Revenue
Fully Diluted EPS was ($0.17), $0.37 Non-GAAP
Provides Outlook for Full Year 2024
DENVER, Feb. 29, 2024 /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 fourth quarter and full year ended December 31, 2023.
"As we have previously communicated, 2023 was a dynamic year for TTEC. The macroeconomic factors created a conservative and uncertain business environment that delayed client contracting decisions and lowered forecasts for certain clients in the second half of the year. While these factors moderated our results, we continued to make progress diversifying our business by growing our client base, completing a strategic phase of our geographic expansion, and expanding our AI-enabled solutions," commented Ken Tuchman, chairman and chief executive officer of TTEC.
"Our 2024 outlook reflects three very specific challenges in our TTEC Engage segment. First, client budget constraints and a conservative mindset in the second half of 2023 is carrying forward into our 2024 outlook. Second, a long-tenured client eliminated one of several lines of business that we supported. While our relationship remains strong with this client and we continue to service their customers across multiple other lines of business, the discontinuation of this one line of business contributes to the impact on our top and bottom line in 2024. Third, while we are pleased by the growing demand for our new offshore locations, the timing lag between our recent wins and normalized revenue run rate and margins is weighing on our outlook," Tuchman continued.
"In TTEC Digital, we delivered record bookings in the fourth quarter and the team is off to a strong start this year. Demand for our differentiated CX technology expertise continues to grow as cloud migrations and AI solutions drive our clients' CX digital transformation agendas."
Tuchman further stated, "As we move into 2024, we are laser focused on execution. We will continue to capitalize on our greatly expanded offshore footprint, deepen our relationships with new and existing clients, apply our AI-enabled solutions and accelerate our margin optimization initiatives."
"TTEC's board of directors' decision to reduce the dividend reflects a prudent shift to prioritize our capital deployment towards continued investments in sustainable growth initiatives and debt reduction associated with strategic acquisitions. As revised, the dividend is in line with our stock price and the dividend yield typical for our industry and the broader market. I am confident we are well positioned to emerge stronger as we exit 2024."
FULL YEAR 2023 FINANCIAL HIGHLIGHTS
Revenue
-- Full year 2023 GAAP revenue increased 0.8 percent to $2.463 billion
compared to $2.444 billion in the prior year.
-- Foreign exchange had a $4.4 million positive impact on revenue for the
full year 2023.
Income from Operations
-- Full year 2023 GAAP income from operations was $118.0 million, or 4.8
percent of revenue, compared to $168.5 million, or 6.9 percent of
revenue in the prior year.
-- Non-GAAP income from operations, excluding restructuring and impairment
charges, equity-based compensation expenses, amortization of purchased
intangibles, and other items, was $200.4 million, or 8.1 percent of
revenue, compared to $248.5 million, or 10.2 percent in the prior year.
-- Foreign exchange had a $2.2 million negative impact on Non-GAAP income
from operations for the full year 2023.
Adjusted EBITDA
-- Full year 2023 Non-GAAP Adjusted EBITDA was $271.5 million, or 11.0
percent of revenue, compared to $320.1 million, or 13.1 percent of
revenue in the prior year.
Earnings Per Share
-- Full year 2023 GAAP fully diluted earnings per share was $0.39 compared
to $2.48 in the prior year.
-- Non-GAAP fully diluted earnings per share was $2.18 compared to $3.59 in
the prior year.
FOURTH QUARTER 2023 FINANCIAL HIGHLIGHTS
Revenue
-- Fourth quarter 2023 GAAP revenue decreased 4.9 percent to $626.2 million
compared to $658.3 million in the prior year.
-- Foreign exchange had a $5.5 million positive impact on revenue in the
fourth quarter of 2023.
Income from Operations
-- Fourth quarter 2023 GAAP income from operations was $16.9 million, or
2.7 percent of revenue, compared to $48.7 million, or 7.4 percent of
revenue in the prior year.
-- Non-GAAP income from operations, excluding restructuring and impairment
charges, equity-based compensation expenses, amortization of purchased
intangibles, and other items, was $41.8 million, or 6.7 percent of
revenue, compared to $69.9 million, or 10.6 percent for the prior year.
-- Foreign exchange had a $2.4 million negative impact on Non-GAAP income
from operations in the fourth quarter 2023.
Adjusted EBITDA
-- Fourth quarter 2023 Non-GAAP Adjusted EBITDA was $57.5 million, or 9.2
percent of revenue, compared to $86.5 million, or 13.1 percent of
revenue in the prior year.
Earnings Per Share
-- Fourth quarter 2023 GAAP fully diluted earnings per share was ($0.17)
compared to $0.54 in the prior year.
-- Non-GAAP fully diluted earnings per share was $0.37 compared to $0.91 in
the prior year.
STRONG CASH FLOW AND BALANCE SHEET FUND INVESTMENTS AND DIVIDENDS
-- Cash flow from operations in the fourth quarter 2023 was $31.5 million
compared to $18.2 million for the fourth quarter 2022. For the full year
2023, cash flow from operations was $144.8 million compared to $137.0
million for the same period 2022.
-- Capital expenditures in the fourth quarter 2023 were $13.1 million
compared to $19.4 million for the fourth quarter 2022. For the full year
2023, capital expenditures were $67.8 million compared to $84.0 million
for the same period 2022.
-- As of December 31, 2023, TTEC had cash and cash equivalents of $172.7
million and debt of $999.3 million, resulting in a net debt position of
$826.5 million. This compares to a net debt position of $810.2 million
for the same period 2022.
-- As of December 31, 2023, TTEC's remaining borrowing capacity under its
revolving credit facility was approximately $90 million compared to $335
million for the same period 2022.
-- On February 27, 2024, the Board declared the next semi-annual dividend
of $0.06 per share, or $2.9 million, payable on April 30, 2024 to
shareholders of record as of April 3, 2024. TTEC's board of directors'
decision to reduce the dividend reflects a prudent shift to prioritize
our capital deployment towards continued investments in sustainable
growth initiatives and debt reduction associated with strategic
acquisitions.
-- TTEC paid a $0.52 per share, or $24.7 million, semi-annual dividend on
October 31, 2023.
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
-- Fourth quarter 2023 GAAP revenue for TTEC Digital decreased 2.1 percent
to $119.1 million from $121.7 million for the year ago period. Income
from operations was $10.0 million or 8.4 percent of revenue compared to
an operating income of $9.9 million or 8.2 percent of revenue in the
prior year.
-- Non-GAAP income from operations was $17.7 million, or 14.8 percent of
revenue compared to operating income of $18.0 million or 14.8 percent of
revenue in the prior year.
TTEC Engage - Digitally-enabled customer care, acquisition, and fraud mitigation services
-- Fourth quarter 2023 GAAP revenue for TTEC Engage decreased 5.5 percent
to $507.1 million from $536.6 million for the year ago period. Income
from operations was $6.9 million or 1.4 percent of revenue compared to
operating income of $38.8 million, or 7.2 percent of revenue in the
prior year.
-- Non-GAAP income from operations was $24.1 million, or 4.8 percent of
revenue, compared to operating income of $52.0 million, or 9.7 percent
of revenue in the prior year.
-- Foreign exchange had a $5.3 million positive impact on revenue and $1.9
million negative impact on income from operations.
BUSINESS OUTLOOK
"We ended 2023 in line with expectations but the recent dynamics in the Engage segment are causing a reduction in our 2024 revenue and margin outlook compared to 2023. We are confident in the initiatives currently in motion that focus on growth and margin improvement," commented Francois Bourret, interim chief financial officer of TTEC. "As digital transformation continues to be a top priority for our clients, we are encouraged by the growing momentum with TTEC Digital. As we move forward, we will navigate this environment to position the company to exit 2024 with a view towards longer-term profitable growth."
TTEC First Quarter and Full Year 2024 Outlook
First Quarter First Quarter Full Year 2024 Full Year
2024 2024 2024
Guidance Mid-Point Guidance Mid-Point
Revenue
$559M - $569M
$564M
$2,275M - $2,365M
$2,320M
Non-GAAP adjusted EBITDA
$52M - $58M
$55M
$215M - $259M
$237M
Non-GAAP adjusted EBITDA margins 9.3% - 10.2% 9.8 % 9.5% - 11.0% 10.2 %
Non-GAAP operating income
$36M - $42M
$39M
$150M - $194M
$172M
Non-GAAP operating income margins 6.4% - 7.4% 6.9 % 6.6% - 8.2% 7.4 %
Interest expense, net ($20M) -($22M)
($21M) ($77M) -($79M) ($78M)
Non-GAAP adjusted tax rate 23% - 25% 24 % 23% - 25% 24 %
Diluted share count 47.4M -47.6M
47.5M 47.4M -47.6M 47.5M
Non-GAAP earnings per a share
$0.25 - $0.34 $0.30
$1.15 - $1.86 $1.51
Engage First Quarter and Full Year 2024 Outlook
First Quarter First Quarter Full Year 2024 Full Year
2024 2024 2024
Guidance Mid-Point Guidance Mid-Point
Revenue
$453M - $457M
$455M
$1,790M - $1,850M
$1,820M
Non-GAAP adjusted EBITDA
$41M - $45M
$43M
$149M - $179M
$164M
Non-GAAP adjusted EBITDA margins 9.2% - 9.9% 9.5 % 8.4% - 9.7% 9.0 %
Non-GAAP operating income
$28M - $32M
$30M
$95M - $125M
$110M
Non-GAAP operating income margins 6.2% - 7.0% 6.6 % 5.3% - 6.8% 6.1 %
Digital First Quarter and Full Year 2024 Outlook
First Quarter First Quarter Full Year 2024 Full Year
2024 2024 2024
Guidance Mid-Point Guidance Mid-Point
Revenue
$106M - $112M
$109M
$485M - $515M
$500M
Non-GAAP adjusted EBITDA
$11M - $13M
$12M
$66M - $80M
$73M
Non-GAAP adjusted EBITDA margins 10.1% - 11.3% 10.7 % 13.5% - 15.5% 14.5 %
Non-GAAP operating income
$8M - $10M
$9M
$55M - $69M
$62M
Non-GAAP operating income margins 7.6% - 8.9% 8.3 % 11.2% - 13.3% 12.3 %
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 2024 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 (pronounced T-TEC) Holdings, Inc. (NASDAQ:TTEC) is a leading global CX (customer experience) technology and services innovator for AI-enabled digital CX solutions. 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 technology, the Company's TTEC Digital business designs, builds, and operates omnichannel contact center technology, CRM, AI and analytics solutions. The Company's TTEC Engage business delivers AI-enabled customer engagement, customer acquisition and growth, tech support, back office, and fraud prevention services. Founded in 1982, the company's singular obsession with CX excellence has earned it leading client, customer, and employee satisfaction scores across the globe. The Company's over 60,000 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 Press 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., Forward-looking statements include, but are not limited to, statements relating to our operations, expected financial position, results of operation, effective tax rate, cash flow, leverage, liquidity, business strategy, competitive position, demand for our services in international operations, acquisition opportunities and impact of acquisitions, capital allocation and dividends, growth opportunities, spending, capital expenditures and investments, competition and market forecasts, industry trends, our human capital resources, 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. Unless otherwise indicated or except where the context otherwise requires, the terms "TTEC," "the Company," "we," "us" and "our"and other similar terms in this report refer to TTEC Holdings, Inc. and its subsidiaries. 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, 2023 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
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.
Corporate Comms Investor
Relations
Marji Chimes Paul Miller
marji.chimes@ttec.com paul.miller@ttec.com
TTEC HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three months ended Twelve months ended
December 31, December 31,
2023 2022 2023 2022
Revenue $626,181 $658,278 $2,462,817 $2,443,707
Operating Expenses:
Cost of services 505,814 495,339 1,932,877 1,856,518
Selling, general and administrative 74,744 80,602 290,873 287,433
Depreciation and amortization 24,904 31,730 101,272 111,791
Restructuring charges, net 3,145 1,412 8,041 5,673
Impairment losses 650 450 11,733 13,749
Total operating expenses 609,257 609,533 2,344,796 2,275,164
Income From Operations 16,924 48,745 118,021 168,543
Other income (expense), net (21,988) (15,877) (77,297) (24,095)
(Loss) / Income Before Income Taxes (5,064) 32,868 40,724 144,448
Provision for income taxes (3,142) (7,318) (22,460) (27,115)
Net (Loss) / Income (8,206) 25,550 18,264 117,333
Net income attributable to noncontrolling interest (1,694) (3,197) (9,836) (14,093)
Net (Loss) / Income Attributable to TTEC Stockholders $(9,900) $22,353 $8,428 $103,240
Net (Loss) / Income Per Share
Basic $(0.17) $0.54 $0.39 $2.49
Diluted $(0.17) $0.54 $0.39 $2.48
Net (Loss) / Income Per Share Attributable to TTEC Stockholders
Basic $(0.21) $0.47 $0.18 $2.19
Diluted $(0.21) $0.47 $0.18 $2.18
Income From Operations Margin 2.7 % 7.4 % 4.8 % 6.9 %
Net (Loss) / Income Margin (1.3) % 3.9 % 0.7 % 4.8 %
Net (Loss) / Income Attributable to TTEC Stockholders Margin (1.6) % 3.4 % 0.3 % 4.2 %
Effective Tax Rate (62.0) % 22.3 % 55.2 % 18.8 %
Weighted Average Shares Outstanding
Basic 47,425 47,220 47,335 47,121
Diluted 47,503 47,299 47,419 47,335
TTEC HOLDINGS, INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(In thousands)
Three months ended Twelve months ended
December 31, December 31,
2023 2022 2023 2022
Revenue:
TTEC Digital $119,118 $121,650 $486,882 $463,670
TTEC Engage 507,063 536,628 1,975,935 1,980,037
Total $626,181 $658,278 $2,462,817 $2,443,707
Income From Operations:
TTEC Digital $9,982 $9,924 $29,846 $34,895
TTEC Engage 6,942 38,821 88,175 133,648
Total $16,924 $48,745 $118,021 $168,543
TTEC HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31, December 31,
2023 2022
ASSETS
Current assets:
Cash and cash equivalents $172,747 $153,435
Accounts receivable, net 394,868 417,637
Prepaids and other current assets 95,064 133,365
Income and other tax receivables 18,524 45,533
Total current assets 681,203 749,970
Property and equipment, net 191,003 183,360
Operating lease assets 121,574 92,431
Goodwill 808,988 807,845
Other intangibles assets, net 198,433 233,909
Income and other tax receivables, long-term 44,673
Other assets 139,724 86,447
Total assets $2,185,598 $2,153,962
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable $96,577 $93,937
Accrued employee compensation and benefits 146,184 145,096
Deferred revenue 81,171 87,846
Current operating lease liabilities 38,271 35,271
Other current liabilities 40,824 49,214
Total current liabilities 403,027 411,364
Long-term liabilities:
Line of credit 995,000 960,000
Non-current operating lease liabilities 96,809 69,575
Other long-term liabilities 75,220 79,273
Total long-term liabilities 1,167,029 1,108,848
Redeemable noncontrolling interest - 55,645
Equity:
Common stock 474 472
Additional paid in capital 407,415 367,673
Treasury stock (589,807) (593,164)
Accumulated other comprehensive income (loss) (89,876) (126,301)
Retained earnings 870,429 911,233
Noncontrolling interest 16,907 18,192
Total equity 615,542 578,105
Total liabilities and equity $2,185,598 $2,153,962
TTEC HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Twelve months ended Twelve months ended
December 31, December 31,
2023 2022
Cash flows from operating activities:
Net income $18,264 $117,333
Adjustments to reconcile net income to net cash provided by operating activities :
Depreciation and amortization 101,272 111,791
Amortization of contract acquisition costs 2,288 2,065
Amortization of debt issuance costs 1,067 1,018
Imputed interest expense and fair value adjustments to contingent consideration 7,579 1,746
Provision for credit losses 2,009 9,391
Loss on disposal of assets 2,219 1,916
Loss on dissolution of subsidiary 301
Impairment losses 11,733 13,749
Deferred income taxes (7,528) (11,001)
Excess tax benefit from equity-based awards 1,705 (1,122)
Equity-based compensation expense 22,071 17,571
Gain on foreign currency derivatives (3) (7)
Changes in assets and liabilities, net of acquisitions:
Accounts receivable 22,359 (74,564)
Prepaids and other assets 8,570 43,699
Accounts payable and accrued expenses 9,518 (12,695)
Deferred revenue and other liabilities (58,659) (83,842)
Net cash provided by operating activities 144,765 137,048
Cash flows from investing activities:
Proceeds from sale of property and equipment 261 229
Purchases of property, plant and equipment (67,839) (84,012)
Acquisitions - (142,420)
Net cash used in investing activities (67,578) (226,203)
Cash flows from financing activities:
Net proceeds from / (repayments of) line of credit 35,000 169,000
Payments on other debt (2,317) (3,245)
Payments of contingent consideration and hold back payments to acquisitions (37,676) (9,600)
Dividends paid to shareholders (49,232) (48,072)
Payments to noncontrolling interest (10,972) (11,883)
Tax payments related to the issuance of restricted stock units (3,037) (7,164)
Net cash (used in) / provided by financing activities (68,234) 89,036
Effect of exchange rate changes on cash, cash equivalents and restricted cash (2,112) (13,499)
Increase / (decrease) in cash, cash equivalents and restricted cash 6,841 (13,618)
Cash, cash equivalents and restricted cash, beginning of period 167,064 180,682
Cash, cash equivalents and restricted cash, end of period $173,905 $167,064
TTEC HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION
(In thousands, except per share data)
Three months ended Twelve months ended
December 31, December 31,
2023 2022 2023 2022
Revenue $626,181 $658,278 $2,462,817 $2,443,707
Reconciliation of Non-GAAP Income from Operations and EBITDA:
Income from Operations $16,924 $48,745 $118,021 $168,543
Restructuring charges, net 3,145 1,412 8,041 5,673
Impairment losses 650 450 11,733 13,749
Cybersecurity incident related impact, net of insurance recovery (446) (3,210) (3,610)
Software accelerated amortization 6,382 8,509
Write-off of acquisition related receivable 900
Property costs not related to operations 757 1,501
Liability related to notifications triggered by labor scheme (1) 6,000 6,000
Grant income for pandemic relief 40
Change in acquisition related obligation 483
Equity-based compensation expenses 5,661 4,331 22,071 17,571
Amortization of purchased intangibles 8,676 9,038 35,759 37,169
Non-GAAP Income from Operations $41,813 $69,912 $200,439 $248,504
Non-GAAP Income from Operations Margin 6.7 % 10.6 % 8.1 % 10.2 %
Depreciation and amortization 15,894 16,310 64,840 66,113
Changes in acquisition contingent consideration 616 (272) 7,480 1,798
Change in escrow balance related to acquisition 625
Loss on dissolution of subsidiary 301
Foreign exchange loss / (gain), net 1,112 1,710 1,950 (6,514)
Other income (expense), net (1,894) (1,156) (4,126) 10,161
Adjusted EBITDA $57,541 $86,504 $271,509 $320,062
Adjusted EBITDA Margin 9.2 % 13.1 % 11.0 % 13.1 %
Reconciliation of Non-GAAP EPS:
Net (Loss) / Income $(8,206) $25,550 $18,264 $117,333
Add: Asset impairment and restructuring charges 3,795 1,862 19,774 19,422
Add: Equity-based compensation expenses 5,661 4,331 22,071 17,571
Add: Amortization of purchased intangibles 8,676 9,038 35,759 37,169
Add: Cybersecurity incident related impact, net of insurance recovery (446) (3,210) (3,610)
Add: Software accelerated amortization 6,382 8,509
Add: Write-off of acquisition related receivable 900
Add: Property costs not related to operations 757 1,501
Add: Liability related to notifications triggered by labor scheme 6,000 6,000
Add: Grant income for pandemic relief 40
Add: Change in acquisition related obligation 483
Add: Changes in acquisition contingent consideration 616 (272) 7,480 1,798
Add: Changes in escrow balance related to acquisition 625
Add: Loss on dissolution of subsidiary 301
Add: Foreign exchange loss / (gain), net 1,112 1,710 1,950 (6,514)
Less: Changes in valuation allowance, return to provision adjustments and (885) (4,909) (7,859) (22,872)
other, and tax effects of items separately disclosed above
Non-GAAP Net Income $17,526 $43,246 $103,179 $169,706
Diluted shares outstanding 47,503 47,299 47,419 47,335
Non-GAAP EPS $0.37 $0.91 $2.18 $3.59
Reconciliation of Free Cash Flow:
Cash Flow From Operating Activities:
Net (Loss) / Income $(8,206) $25,550 $18,264 $117,333
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 24,904 31,730 101,272 111,791
Other 14,836 (39,045) 25,229 (92,076)
Net cash provided by operating activities 31,534 18,235 144,765 137,048
Less - Total Cash Capital Expenditures 13,117 19,448 67,839 84,012
Free Cash Flow $18,417 $(1,213) $76,926 $53,036
(1) - For further information, please see discussion in the Risk Factors section of the 2023 Form 10-K filed on February 29, 2024.
Reconciliation of Non-GAAP Income from Operations and Adjusted EBITDA by Segment :
TTEC Engage TTEC Digital TTEC Engage TTEC Digital
Q4 23 Q4 22 Q4 23 Q4 22 YTD 23 YTD 22 YTD 23 YTD 22
Income from Operations $6,942 $38,821 $9,982 $9,924 $88,175 $133,648 $29,846 $34,895
Restructuring charges, net 1,823 1,130 1,322 282 4,250 5,251 3,791 422
Impairment losses 700 24 (50) 426 8,929 13,112 2,804 637
Cybersecurity incident related impact, net of insurance recovery (446) (3,210) (3,610)
Software accelerated amortization 5,106 1,276 6,808 1,701
Write-off of acquisition related receivable 900
Property costs not related to operations 757 1,501
Grant income for pandemic relief 40
Change in acquisition related obligation 483
Liability related to notifications triggered by labor scheme 6,000 6,000
Equity-based compensation expenses 3,658 2,659 2,003 1,672 14,257 11,476 7,814 6,095
Amortization of purchased intangibles 4,264 4,658 4,412 4,380 18,215 17,272 17,544 19,897
Non-GAAP Income from Operations $24,144 $51,952 $17,669 $17,960 $138,157 $183,957 $62,282 $64,547
Depreciation and amortization 13,458 13,667 2,436 2,643 55,153 54,561 9,687 11,552
Changes in acquisition contingent consideration 616 (272) 7,480 1,798
Change in escrow balance related to acquisition 625
Loss on dissolution of subsidiary 301
Foreign exchange loss / (gain), net 1,271 1,606 (159) 104 2,085 (5,540) (135) (974)
Other income (expense), net (1,728) (1,063) (166) (93) (4,060) 9,352 (66) 809
Adjusted EBITDA $37,761 $65,890 $19,780 $20,614 $199,741 $244,128 $71,768 $75,934
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SOURCE TTEC Holdings, Inc.
