IBEX Limited (NASDAQ:IBEX) Q2 2022 Earnings Conference Call February 16, 2022 4:30 PM ET Company Participants Brinlea Johnson - IR, The Blueshirt Group Bob Dechant - CEO Karl Gabel - CFO Conference Call Participants Tobey Sommer - Truist Securities Dave Koning - Baird Arvind Ramnani - Piper Sandler Matthew Roswell - RBC Capital Markets Operator Welcome to the IBEX Second Quarter Full Year 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentatio ...

IBEX Limited (NASDAQ:IBEX) Q1 2022 Earnings Conference Call November 22, 2021 4:30 PM ET Company Participants Brinlea Johnson - IR, The Blueshirt Group Bob Dechant - CEO Karl Gabel - CFO Conference Call Participants Dave Koning - Baird Tobey Sommer - Truist Securities Dan Perlin - RBC Capital Markets George Melas-Kyriazi - MKH Management Operator Thank you for standing by, and welcome to the ibex First Quarter Fiscal Year 2022 Earnings Conference Call. At this time, all participants are in a listen-only mod ...

[Introduction](index=6&type=section&id=INTRODUCTION) The company's common shares were listed on Nasdaq in August 2020, with financial statements prepared under IFRS and presented in U.S. dollars - The company's common shares were listed on the Nasdaq Global Market under the ticker symbol **"IBEX"** on August 7, 2020[17](index=17&type=chunk) - The company's fiscal year ends on June 30, and audited consolidated financial statements for the three years ended June 30, 2021, have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB)[19](index=19&type=chunk) - All financial information is presented in U.S. dollars[20](index=20&type=chunk) [Cautionary Statement Regarding Forward-Looking Statements](index=7&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This report contains forward-looking statements subject to risks, including COVID-19, cyberattacks, client retention, international operations, and data privacy compliance - This annual report contains forward-looking statements that are subject to risks and uncertainties, highlighting key factors that could cause actual results to differ materially from projections[22](index=22&type=chunk) - Important risk factors mentioned include the ongoing impact of the COVID-19 pandemic, the effect of cyberattacks on information technology systems, the ability to attract and retain key clients, the ability to manage international operations, particularly in Pakistan, the Philippines, Jamaica, and Nicaragua, and the ability to comply with privacy, data protection, and information security laws[23](index=23&type=chunk) PART I [Key Information](index=10&type=section&id=ITEM%203.%20KEY%20INFORMATION) This section provides an overview of IBEX as a leading customer support provider, presents selected historical financial data, and details significant business, jurisdictional, and share-related risks [Selected Financial Data](index=10&type=section&id=A.%20Selected%20Financial%20Data) The company presents selected consolidated financial data for FY2018-2021, showing consistent revenue growth, fluctuating net income, and non-GAAP measures like Adjusted EBITDA and Free Cash Flow Selected Financial and Operating Data (US$ in thousands) | Indicator | 2021 | 2020 | 2019 | 2018 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $443,662 | $405,135 | $368,380 | $342,200 | | **Income / (loss) from operations** | $13,799 | $19,513 | $6,805 | $(17,777) | | **Net income / (loss) for the year** | $2,847 | $7,770 | $10,965 | $(15,881) | | **Adjusted EBITDA from continuing operations (unaudited)** | $66,244 | $55,241 | $38,512 | $4,886 | | **Adjusted EBITDA margin (unaudited)** | 14.9% | 13.6% | 10.5% | 1.4% | | **Total assets** | $274,287 | $195,236 | $188,302 | $157,081 | | **Total equity** | $80,659 | $16,148 | $8,628 | $27,953 | [Risk Factors](index=11&type=section&id=D.%20Risk%20Factors) The company faces numerous business, jurisdictional, and share-related risks, including COVID-19 impacts, cybersecurity attacks, client concentration, Bermuda incorporation, and principal shareholder control - **Business Risks**: - **COVID-19 Pandemic**: The pandemic has adversely impacted business and results, with ongoing uncertainty, requiring remote work mobilization that poses operational and cybersecurity risks, and potentially increasing costs for facility reconfiguration and employee health management[39](index=39&type=chunk) - **Cybersecurity Attack**: The company was targeted by a ransomware attack on August 17, 2020, impacting a portion of its IT systems and resulting in the exfiltration of some non-production data, which, while not believed to have a material impact, could lead to future losses or reputational harm[53](index=53&type=chunk) - **Client Concentration**: A substantial portion of revenue comes from a few key clients, with the top three clients accounting for **35.0% of revenue in FY2021**, down from **43.7% in FY2020** and **50.6% in FY2019**[56](index=56&type=chunk) - **Jurisdictional & Shareholder Risks**: - **Bermuda Incorporation**: The company is subject to Bermuda's Economic Substance Act 2018, requiring a substantial economic presence, and as a foreign private issuer, it is exempt from certain U.S. proxy rules and Nasdaq corporate governance standards[162](index=162&type=chunk) - **Control by Principal Shareholder**: The largest shareholder, The Resource Group International Limited (TRGI), beneficially owns approximately **62% of outstanding common shares**, giving it substantial control over key transactions and board appointments[170](index=170&type=chunk) - **Amazon Warrant**: A 10-year warrant issued to an Amazon subsidiary could dilute ownership interests if exercised, and its fair value fluctuations could adversely impact results of operations[199](index=199&type=chunk) [Information on the Company](index=60&type=section&id=ITEM%204.%20INFORMATION%20ON%20THE%20COMPANY) This section details the company's history, including its 2017 reorganization and 2019 spin-off of Etelequote, and provides a comprehensive business overview, outlining its transformation into a technology-led CX provider, service offerings, global delivery model, growth strategy, organizational structure, and property, plant, and equipment [History and Development of the Company](index=60&type=section&id=A.%20History%20and%20development%20of%20the%20company) IBEX Limited was incorporated in 2017 by TRGI to consolidate its customer experience (CX) businesses, completed a reorganization, spun off Etelequote Limited in 2019, and qualifies as both an "Emerging Growth Company" and a "Controlled Company" - On June 30, 2017, TRGI completed a Reorganization Transaction, resulting in various continuing business entities becoming subsidiaries of IBEX Limited[205](index=205&type=chunk) - On June 26, 2019, the company transferred all its equity interests in Etelequote Limited to its parent company, TRGI, for a consideration of **$47.9 million**, with Etelequote now treated as a discontinued operation[209](index=209&type=chunk) - The company qualifies as a **"controlled company"** under Nasdaq rules because more than **50% of its voting power** is held by TRGI, exempting it from certain board and committee independence requirements[215](index=215&type=chunk) [Business Overview](index=65&type=section&id=B.%20Business%20Overview) IBEX is a technology-led CX solutions provider, focusing on high-growth clients through ibex Connect, Digital, and CX platforms, powered by Wave X, with a global delivery model and 'land and expand' strategy - The company has transformed from a traditional BPO to a technology-led CX provider, focusing on high-growth brands, with new clients acquired since FY16 representing approximately **$230 million of revenue in FY21**, accounting for **52% of total revenues**[225](index=225&type=chunk)[230](index=230&type=chunk) - IBEX's service offerings are categorized into three main areas: - **ibex Connect**: Core offering for omni-channel customer service, technical support, and back-office services[269](index=269&type=chunk) - **ibex Digital**: Technology-driven customer acquisition solutions, including digital marketing and e-commerce[270](index=270&type=chunk) - **ibex CX**: A suite of tools to measure, monitor, and manage clients' customer experiences and analytics[271](index=271&type=chunk) - The company's growth strategy focuses on a **"land and expand" model**, winning new digital-first clients and then expanding the scope of services, resulting in revenues from client relationships in their second year being **2.5x to 3.5x of their first-year revenues**[258](index=258&type=chunk)[259](index=259&type=chunk) - IBEX has significantly shifted its capacity to lower-cost regions, with **74% of its capacity** as of October 1, 2021, located in offshore and nearshore markets like the Philippines, Jamaica, and Nicaragua, up from a smaller proportion in prior years[239](index=239&type=chunk)[255](index=255&type=chunk) [Property, Plant and Equipment](index=97&type=section&id=D.%20Property%2C%20plant%20and%20equipment) As of June 30, 2021, the company operated 31 leased delivery centers across seven countries with 17,916 workstations, primarily in the Philippines, Jamaica, and Pakistan Delivery Centers and Workstations by Country (as of June 30, 2021) | Country | Number of centers | Number of workstations | | :--- | :--- | :--- | | United States | 6 | 2,153 | | Philippines | 9 | 7,335 | | Pakistan | 7 | 2,300 | | Jamaica | 5 | 4,399 | | Nicaragua | 2 | 1,510 | | Senegal | 1 | 204 | | United Kingdom | 1 | 15 | | **Total** | **31** | **17,916** | [Operating and Financial Review and Prospects](index=99&type=section&id=ITEM%205.%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) This section analyzes the company's financial condition and results for FY2019-2021, detailing key performance factors, operational results, non-GAAP measures, liquidity, capital resources, and contractual obligations [Operating Results](index=99&type=section&id=A.%20Operating%20Results) FY2021 revenue grew 9.5% to $443.7 million, driven by new clients, while operating income decreased due to COVID-19 costs and warrant adjustments, with Adjusted EBITDA increasing to $66.2 million Consolidated Statement of Profit or Loss (US$ in thousands) | | Fiscal Year ended June 30, | | :--- | :--- | :--- | :--- | | | **2021** | **2020** | **2019** | | **Revenue** | $443,662 | $405,135 | $368,380 | | **Income / (loss) from operations** | $13,799 | $19,513 | $6,805 | | **Net income / (loss) for the year, continuing operations** | $2,847 | $7,770 | $(4,519) | | **Net income / (loss) for the year** | $2,847 | $7,770 | $10,965 | - In fiscal year 2021, the company invested approximately **$13 million** in employee health, safety, and wellness related to COVID-19, including transportation, disinfection, and company-paid vaccinations, compared to **$6.1 million** in net costs incurred in FY2020[336](index=336&type=chunk) Reconciliation of Adjusted EBITDA from continuing operations (US$ in thousands) | | Year ended June 30, | | :--- | :--- | :--- | :--- | | | **2021** | **2020** | **2019** | | **Net income / (loss) from continuing operations** | $2,847 | $7,770 | $(4,519) | | Finance expense | 9,034 | 9,428 | 7,709 | | Income tax expense | 1,918 | 2,315 | 3,615 | | Depreciation and amortization | 28,197 | 24,472 | 21,805 | | **EBITDA from continuing operations** | $41,996 | $43,985 | $28,610 | | Adjustments (Non-recurring, share-based payments, etc.) | 24,248 | 11,256 | 9,902 | | **Adjusted EBITDA from continuing operations** | **$66,244** | **$55,241** | **$38,512** | [Liquidity and Capital Resources](index=130&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) Principal liquidity sources are operations and credit facilities; cash increased to $57.8 million due to the August 2020 IPO, and net debt decreased to $54.7 million Summary of Cash Flows (US$ in thousands) | | Year ended June 30, | | :--- | :--- | :--- | :--- | | | **2021** | **2020** | **2019** | | **Net cash inflow / (outflow) from Operating activities** | $25,897 | $51,719 | $2,202 | | **Net cash inflow / (outflow) from Investing activities** | $(20,173) | $(4,835) | $(9,084) | | **Net cash inflow / (outflow) from Financing activities** | $30,429 | $(33,867) | $2,552 | | **Net increase / (decrease) in cash** | $35,972 | $12,997 | $(4,646) | - The company's cash position improved significantly due to its initial public offering in August 2020, which raised net proceeds of **$63.1 million**[458](index=458&type=chunk) Net Debt Calculation (US$ in thousands) | | June 30, 2021 | June 30, 2020 | | :--- | :--- | :--- | | Total debt (Borrowings and Leases) | $112,516 | $105,970 | | Cash and cash equivalents | $57,842 | $21,870 | | **Net debt** | **$54,674** | **$84,100** | [Contractual Obligations](index=141&type=section&id=F.%20Contractual%20obligations) As of June 30, 2021, total contractual obligations were $143.6 million, primarily comprising lease obligations, lines of credit, and long-term borrowings Future Contractual Obligations as of June 30, 2021 (US$ in thousands) | Obligation | Total | Less than one year | 1 to 3 years | 4 to 5 years | Over 5 years | | :--- | :--- | :--- | :--- | :--- | :--- | | Lease obligations | $112,885 | $18,344 | $32,811 | $25,725 | $36,005 | | Long term borrowings | $6,481 | $4,626 | $1,855 | — | — | | Lines of credit | $22,312 | $22,312 | — | — | — | | **Total obligations** | **$143,641** | **$45,732** | **$35,229** | **$25,725** | **$36,955** | [Directors, Senior Management and Employees](index=142&type=section&id=ITEM%206.%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section covers leadership, compensation, board structure, and employee base, detailing executive backgrounds, aggregate compensation, equity plans, and the global workforce of 24,243 employees [Compensation](index=146&type=section&id=B.%20Compensation) FY2021 aggregate compensation for directors and executive officers was approximately $7.0 million, including salary, share-based payments, and bonuses, with the 2020 LTIP as the primary equity incentive plan - Aggregate compensation for directors and executive officers in fiscal year 2021 was approximately **$7.0 million**, comprising **$2.8 million in salary**, **$1.7 million in share-based payments**, and **$2.5 million in commissions and bonuses**[522](index=522&type=chunk) - The company adopted the IBEX Limited 2020 Long Term Incentive Plan (2020 LTIP), authorizing **1,287,326 common shares** for issuance, which is the primary vehicle for future equity awards[522](index=522&type=chunk)[557](index=557&type=chunk) - The 2017 IBEX Plan was terminated on December 28, 2018, and all grants were cancelled; the 2018 Restricted Share Plan (2018 RSA Plan) was subsequently adopted, with no further awards made under it as of May 2020, and future grants coming from the 2020 LTIP[536](index=536&type=chunk)[551](index=551&type=chunk) [Employees](index=168&type=section&id=D.%20Employees) As of June 30, 2021, IBEX had 24,243 global employees, mostly production agents, with a strong focus on workplace culture for recruitment and retention, and no unionized workforce Employees by Functional Area (as of June 30, 2021) | Function | Number of Employees | Percent of Total | | :--- | :--- | :--- | | Production agents | 19,224 | 79.3% | | Production support | 3,226 | 13.3% | | Corporate & Other | 1,693 | 7.4% | | **Total** | **24,243** | **100.0%** | - The company considers its employees its most valuable asset and focuses on a strong workplace culture to drive recruitment and retention, with none of its employees part of a labor union[617](index=617&type=chunk)[618](index=618&type=chunk) [Major Shareholders and Related Party Transactions](index=169&type=section&id=ITEM%207.%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section details the company's ownership structure, with TRGI as the principal shareholder controlling 62% of shares, and outlines key related-party agreements and transaction approval policies [Major Shareholders](index=169&type=section&id=A.%20Major%20Shareholders) As of September 1, 2021, TRGI beneficially owned 61.8% of outstanding common shares, granting it significant control, while executive officers and directors collectively owned 8.9% Beneficial Ownership as of September 1, 2021 | Name | Number of Shares | Percentage | | :--- | :--- | :--- | | TRGI (Principal Shareholder) | 11,416,683 | 61.8% | | All executive officers and directors as a group (15 persons) | 1,638,229 | 8.9% | [Related-Party Transactions](index=173&type=section&id=B.%20Related-Party%20Transactions) The company has several related-party transactions, primarily with TRGI and its affiliates, including a Stockholders' Agreement requiring TRGI's consent for material actions, and registration rights for TRGI and Amazon - A Stockholders' Agreement with TRGI requires TRGI's prior written consent for a range of material actions, including significant acquisitions, mergers, asset dispositions, and incurrence of indebtedness[636](index=636&type=chunk) - On July 21, 2020, the board approved a one-time dividend of **$4.0 million**, which was paid to TRGI as the holder of the Series A preferred share prior to the IPO[635](index=635&type=chunk) - The company has granted registration rights to both TRGI and Amazon, allowing them to require the company to register their shares for public sale under certain conditions[639](index=639&type=chunk)[640](index=640&type=chunk) [Additional Information](index=180&type=section&id=ITEM%2010.%20ADDITIONAL%20INFORMATION) This section covers material contracts, exchange controls, and U.S. and Bermuda income tax consequences for shareholders, including the company's tax assurance until 2035 and its expected non-PFIC status [Taxation](index=182&type=section&id=E.%20Taxation) The company is exempt from Bermuda income taxes until 2035 and expects U.S. federal income tax distributions to be dividends, not anticipating classification as a Passive Foreign Investment Company (PFIC) - There is currently no Bermuda income tax, withholding tax, or capital gains tax payable by the company or its shareholders, and the company has received an assurance from the Bermuda Minister of Finance that this will not change until at least **March 31, 2035**[668](index=668&type=chunk) - For U.S. federal income tax purposes, the company does not expect to be classified as a Passive Foreign Investment Company (PFIC) for the current or foreseeable future tax years; however, this is a factual determination made annually[681](index=681&type=chunk) PART II [Material Modifications to the Rights of Security Holders and Use of Proceeds](index=190&type=section&id=ITEM%2014.%20MATERIAL%20MODIFICATIONS%20TO%20THE%20RIGHTS%20OF%20SECURITY%20HOLDERS%20AND%20USE%20OF%20PROCEEDS) In August 2020, the company completed its IPO, selling 3,571,429 common shares at $19.00, raising $63.1 million net proceeds for facility expansion, system upgrades, and potential debt repayment - In its August 2020 IPO, the company sold **3,571,429 common shares** at **$19.00 per share**, raising net proceeds of approximately **$63.1 million**[698](index=698&type=chunk) - The net proceeds are intended to be used for building out and expanding facilities, investing in upgraded support systems, and/or repaying high-interest debt[699](index=699&type=chunk) [Controls and Procedures](index=191&type=section&id=ITEM%2015.%20CONTROLS%20AND%20PROCEDURES) Management concluded disclosure controls and internal control over financial reporting were effective as of June 30, 2021, successfully remediating a material weakness identified in the prior fiscal year - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2021[701](index=701&type=chunk) - A material weakness in internal control over financial reporting related to complex accounting matters, identified during the FY2020 audit, was determined to be remediated as of June 30, 2021[704](index=704&type=chunk) PART III [Financial Statements](index=197&type=section&id=ITEM%2018.%20FINANCIAL%20STATEMENTS) This section contains the audited consolidated financial statements for FY2019-2021, prepared under IFRS, including the independent auditor's report, core statements, and detailed notes [Notes to the Consolidated Financial Statements](index=211&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes provide detailed information on basis of preparation, critical accounting estimates, revenue recognition, borrowings, leases, share-based compensation, related-party transactions, and the Etelequote spin-off - **Going Concern**: Management has a reasonable expectation that the Group has adequate resources to continue its operational existence for at least twelve months from the date of approval of the financial statements, despite incurring non-recurring expenses due to COVID-19[751](index=751&type=chunk)[754](index=754&type=chunk) - **Revenue Recognition**: Revenue from contact center services is recognized over time as services are performed; revenue from digital services is recognized at a point in time upon successful customer acquisition; revenue from the discontinued ETQ operation included estimates for renewal commissions[835](index=835&type=chunk)[838](index=838&type=chunk)[839](index=839&type=chunk) - **Warrant**: A 10-year warrant was issued to Amazon to acquire **1,674,017 common shares** at an exercise price of **$9.42**, vesting based on revenue milestones, and accounted for as a liability at fair value, with changes in fair value recorded in the income statement[1126](index=1126&type=chunk)[1127](index=1127&type=chunk)[1128](index=1128&type=chunk) - **Discontinued Operations**: On June 26, 2019, the Group transferred its Etelequote Limited subsidiary to its parent company, TRGI, with the results of Etelequote presented as a discontinued operation, which had net income of **$15.5 million in FY2019**[1146](index=1146&type=chunk)[1150](index=1150&type=chunk)

Financial Data and Key Metrics Changes - Full-year revenue increased by 9.5% to $443.7 million compared to the prior year [39] - Adjusted EBITDA increased to $66.2 million or 14.9% of revenue compared to $55.2 million or 13.6% of revenue in the prior year [39] - Adjusted net income for the full year was $23.6 million versus $17 million last year [39] - Fourth quarter revenue of $108.9 million increased by 7.9% compared to the year-ago quarter [49] - Non-GAAP pro forma fully diluted adjusted earnings per share increased to $0.31, compared to $0.16 in the prior year quarter [49] Business Line Data and Key Metrics Changes - Revenue from clients won since 2016 is approximately $230 million, up 40% from the prior year, with a five-year CAGR of 84% [10] - The top three legacy clients represented 34.2% of overall revenue, down from 43.7% last year, exiting the year at 28.2% in Q4 [40] - Retail and e-commerce revenue increased to 19.6% of annual revenue compared to 16.8% in the prior year [40] - FinTech and HealthTech combined revenue increased to 19.3% in Q4, up from 9.8% in the fourth quarter of fiscal year '20 [41] Market Data and Key Metrics Changes - The company has established a strong presence in nearshore and offshore markets, with a 34% increase in new seats [11] - The company plans to grow its Honduran workforce to over 2,000 employees within the next two years [12] - Capacity utilization remains strong at 77% in June 2021, down from 84% in June 2020 [46] Company Strategy and Development Direction - The company is focused on becoming a leader in digital-first business solutions, emphasizing tech-led solutions and customer experience [8] - The company aims to diversify its client base and reduce reliance on legacy clients, with a focus on high-margin digital-first services [11] - The company is investing in new sites and expanding its workforce to meet growing demand [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory and the strength of its sales pipeline, expecting revenue growth of 7% to 9% in fiscal year '22 [50] - The company anticipates an acceleration in revenue growth beginning in the second quarter of fiscal year '22 [50] - Management highlighted the importance of maintaining employee health and safety during COVID-19, investing nearly $13 million in protective measures [17] Other Important Information - The company ended the fiscal year with $57.8 million in cash and total borrowings of $28.5 million [48] - The company has a best-in-class employee net promoter score of 71, indicating high employee satisfaction [20] Q&A Session Summary Question: What has been the experience ramping nearshore sites? - Management reported no margin degradation while bringing capacity online and expressed confidence in filling new sites [55] Question: What drove the significant step-down in large account concentration during Q4? - Management attributed the decline to one-time events affecting two major clients, but noted that market share with those clients expanded despite revenue declines [59] Question: How have remote working costs impacted operating margins? - Management indicated that operating costs have increased due to COVID-related expenses, but also noted advantages such as reduced travel expenses [61][65] Question: What is the expected revenue growth despite adding new workstations? - Management explained that revenue growth is conservative due to various factors, including the Delta variant and ongoing investments in the business [71] Question: What is the visibility across different solutions offered by the company? - Management stated that the Connect part of the business has strong revenue visibility, while digital marketing is less predictable due to its dependence on client campaigns [90]

IBEX Limited (NASDAQ:IBEX) Q3 2021 Earnings Conference Call May 18, 2021 4:30 PM ET Company Participants Brinlea Johnson – Managing Director-The Blueshirt Group Bob Dechant – Chief Executive Officer Karl Gabel – Chief Financial Officer Conference Call Participants Dan Perlin – RBC Capital Markets Tobey Sommer – Truist Securities Ashwin Shirvaikar – Citi Dave Koning – Baird Arvind Ramnani – Piper Operator Thank you for standing by and welcome to the IBEX Third Quarter 2021 Earnings Conference Call. At this t ...

Financial Data and Key Metrics Changes - Revenue for Q2 2021 reached $117.2 million, an increase of 9% year-over-year, marking an all-time high for the company [5][20] - Adjusted EBITDA increased by 18.7% to $17.6 million, achieving a 15% margin compared to 13.8% in the prior year [22] - Net income for Q2 2021 was $2.5 million, down from $4.8 million in the same period last year, primarily due to $1.6 million in non-recurring COVID-19 related costs [21][24] Business Line Data and Key Metrics Changes - New economy revenue grew by 10.5%, while non-voice revenue increased slightly and digital revenue decreased by 3.4% compared to the prior year [20] - After adjusting for a client adversely impacted by the pandemic, new economy revenue grew by 28.1% [20] - Revenue from clients outside the top three increased by 25.9%, indicating a diversification in client base [23] Market Data and Key Metrics Changes - Telecommunications revenue decreased to 29.5% from 36.2% year-over-year, while retail and e-commerce revenue increased to 22.6% from 16.2% [23] - The company continues to see strong demand from new economy clients, which has been a significant driver of growth [19] Company Strategy and Development Direction - The company aims to be a growth leader and a key player in nearshore markets, with a focus on achieving EBITDA margins of 15% and beyond [5][18] - IBEX is expanding its operational capacity by launching new centers globally, including a fifth center in Jamaica and significant capacity in the Philippines [6][7] - The company is raising its full-year guidance for revenue to $445 million to $448 million, reflecting a 10% increase from the prior year [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the business outlook, citing strong demand from clients and the ability to adapt to changing market conditions due to COVID-19 [19][38] - The competitive landscape has shifted, with clients increasingly seeking partners that can provide on-demand capacity and digital transformation solutions [9][38] - Management believes that the trend towards outsourcing will accelerate, as clients look for flexible solutions in a post-pandemic environment [38] Other Important Information - The company has maintained operational safety and efficiency during the pandemic, with 100% of health orders passed and centers operational for the past three quarters [17] - Capital expenditures for Q2 2021 were $7.2 million, up from $4.1 million in the prior year, reflecting ongoing investments in capacity expansion [28] Q&A Session Summary Question: Insights on onboarding new talent during the pandemic - Management highlighted the strong reputation of IBEX as an employer, enabling successful recruitment and training of new agents despite challenges [36] Question: Impact of COVID-19 on customer base - Management noted that many clients have thrived during the pandemic, leading to increased demand for on-demand capacity solutions [37] Question: Revenue trends for the second half of the year - Management indicated optimism for continued growth, with potential upside from new client wins impacting 2022 [45] Question: Free cash flow expectations - Management confirmed that the company is positioned to be free cash flow positive for the remainder of the year, following significant investments made [46] Question: Staffing considerations in a post-pandemic environment - Management expressed confidence in managing staffing levels and productivity, anticipating minimal impact from increased employee travel [53] Question: Differentiation in customer service offerings - Management emphasized the role of Wave X technologies in enhancing agent effectiveness and improving customer experience, setting IBEX apart from competitors [60]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 20-F (Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 5(d) OF THE SECURITIES ACT OF 1934 For the fiscal year ended June 30, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of eve ...