Financial Data and Key Metrics Changes - Revenues for the quarter were $124.6 million, a decline of 2.5% compared to $127.8 million in the prior year quarter [16] - Adjusted EBITDA increased by 6% year-on-year to $13.7 million, with an adjusted EBITDA margin of 11%, up 90 basis points from the previous year [12][43] - Adjusted net income improved to $7.6 million from $6.8 million in the prior year quarter, with adjusted EPS increasing to $0.40 from $0.36 [12][17] - Free cash flow increased to $6.6 million, more than triple from the prior year quarter, with a conversion rate of nearly 50% from adjusted EBITDA [5][46] - The company ended the quarter with a net cash position of $61.1 million, up from $56.4 million as of June 2023 [21] Business Line Data and Key Metrics Changes - The revenue mix continues to trend towards higher-margin services, with digital and omnichannel delivery now representing 77% of total revenue, up from 71% a year ago [8][13] - Retail and e-commerce increased to 23.4% of first quarter revenue versus 21.3% in the prior year quarter [18] - HealthTech increased to 11.9% of first quarter revenue versus 10.2% in the prior year quarter [18] - The telecommunications vertical decreased to 16.8% of quarterly revenue versus 17.3% in the prior year quarter [44] Market Data and Key Metrics Changes - Offshore and nearshore revenues now comprise 75% of total revenue, up from 70% in the prior year quarter [8] - The company has seen a decline in the FinTech vertical, which decreased to 14.8% of revenue for the quarter versus 19.9% in the prior year quarter [44] Company Strategy and Development Direction - The company is focused on expanding its higher-margin integrated omnichannel and digital-first support, which is expected to drive future growth [13] - The management emphasizes the importance of leveraging AI technology to enhance customer experience and operational efficiency [7][39] - The company is exploring new markets for client expansion and is open to targeted acquisitions to enhance its geographical footprint [40][55] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resiliency of the business, supported by client diversification and strategic vertical expansions [22] - The company anticipates returning to growth later in the year, with a strong pipeline of new client wins [22][70] - Management acknowledged the challenges posed by the current market environment but remains optimistic about achieving upper single-digit growth in the latter half of the fiscal year [36][70] Other Important Information - The company has a share repurchase program authorized for up to $30 million, with over 400,000 shares repurchased to date [29][47] - Capital expenditures were $2.1 million, or 1.6% of revenue, in the first quarter, down from $3.6 million or 2.8% of revenue in the prior year quarter [20] Q&A Session Summary Question: What is the pace of deal flow and the contours of the pipeline for new logos? - Management noted that the pace of deal flow is improving, with several large deals won recently, indicating a return to previous levels of activity [27] Question: How much headwind is the shift offshore impacting revenue growth? - Management indicated that the shift offshore is contributing to a headwind, but they expect to resume strong growth once the transition stabilizes [33][36] Question: Can you describe the competitive landscape for recent large wins? - Management highlighted that they are winning competitive deals against large players by leveraging their advanced technology and analytics capabilities [68][79] Question: How do you expect AI to help during peak volumes? - Management stated that while AI is still in early stages, it has the potential to improve efficiency and reduce the need for additional hiring during peak seasons [84][92] Question: What are the parameters for targeted acquisitions? - Management expressed interest in geographic expansion and strategic verticals for potential acquisitions, focusing on opportunities that align with their growth strategy [55][57]

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[FORM 10-Q General Information](index=1&type=section&id=FORM%2010-Q%20General%20Information) This section details the Form 10-Q filing, including reporting period, filer status, and outstanding shares - IBEX LIMITED filed a Quarterly Report on Form 10-Q for the period ended September 30, 2023[2](index=2&type=chunk) - The registrant is an Accelerated Filer and an Emerging Growth Company[4](index=4&type=chunk)[5](index=5&type=chunk) - As of October 31, 2023, the number of common shares outstanding was **17,938,752**[6](index=6&type=chunk) [CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=4&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section warns that forward-looking statements are subject to risks and uncertainties that could cause actual results to differ - This Form 10-Q contains forward-looking statements based on current expectations, assumptions, and projections, which are not guarantees of performance and involve known and unknown risks and uncertainties[10](index=10&type=chunk) - Important factors that could cause actual results to differ materially include general economic uncertainty, geopolitical conditions, ability to attract and retain clients, profitability, managing international operations, and the impact of cyberattacks[10](index=10&type=chunk)[12](index=12&type=chunk) [PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the company's unaudited consolidated financial statements and management's analysis for the period [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the period ended September 30, 2023, prepared in accordance with U.S. GAAP, along with detailed notes explaining significant accounting policies and specific financial line items [Consolidated Balance Sheets (unaudited)](index=6&type=section&id=Consolidated%20Balance%20Sheets%20(unaudited)) This table presents the company's financial position, including assets, liabilities, and equity, as of September 30, 2023 | Metric | September 30, 2023 ($000s) | June 30, 2023 ($000s) | | :-------------------------- | :-------------------------- | :------------------- | | Total assets | 295,480 | 293,324 | | Total liabilities | 139,441 | 143,360 | | Total stockholders' equity | 156,039 | 149,964 | - Cash and cash equivalents increased to **$62.0 million** as of September 30, 2023, from **$57.4 million** as of June 30, 2023[16](index=16&type=chunk) [Consolidated Statements of Comprehensive Income (unaudited)](index=8&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(unaudited)) This table details the company's revenues, expenses, and net income for the three months ended September 30, 2023 | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Revenue | 124,609 | 127,805 | | Income from operations | 8,331 | 7,670 | | Net income | 7,425 | 6,523 | | Basic EPS | 0.41 | 0.36 | | Diluted EPS | 0.39 | 0.35 | - Net income increased by **13.8%** year-over-year, and diluted EPS increased by **11.4%** year-over-year[18](index=18&type=chunk) [Consolidated Statements of Stockholders' Equity (unaudited)](index=9&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity%20(unaudited)) This table outlines changes in the company's equity, including capital, treasury stock, and accumulated deficit | Metric | September 30, 2023 ($000s) | June 30, 2023 ($000s) | | :-------------------------- | :-------------------------- | :------------------- | | Additional paid-in capital | 206,323 | 204,734 | | Treasury stock | (5,726) | (3,682) | | Accumulated deficit | (37,353) | (44,778) | | Total Stockholders' Equity | 156,039 | 149,964 | - The company repurchased **134,524 shares** of common stock for **$2.0 million** during the three months ended September 30, 2023[21](index=21&type=chunk) [Consolidated Statements of Cash Flows (unaudited)](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20(unaudited)) This table summarizes cash flows from operating, investing, and financing activities for the quarter | Cash Flow Activity | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Net cash inflow from operating activities | 8,684 | 5,562 | | Net cash outflow from investing activities | (2,052) | (3,558) | | Net cash outflow from financing activities | (1,967) | (7,666) | | Net increase / (decrease) in cash and cash equivalents | 4,600 | (5,980) | | Cash and cash equivalents, ending | 62,029 | 42,851 | - Net cash inflow from operating activities increased by **$3.1 million** year-over-year[24](index=24&type=chunk) [Notes to the Consolidated Financial Statements (unaudited)](index=11&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements%20(unaudited)) This section provides detailed explanations and disclosures supporting the unaudited consolidated financial statements [1. OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=11&type=section&id=1.%20OVERVIEW%20AND%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note describes the company's business, U.S. GAAP transition, and significant accounting policies - IBEX Limited is an end-to-end provider of technology-enabled customer lifecycle experience (CLX) solutions, operating in a single operating and reportable segment[26](index=26&type=chunk)[27](index=27&type=chunk) - Effective July 1, 2023, the Company transitioned from IFRS to U.S. GAAP and became a domestic filer[28](index=28&type=chunk) - The Company qualifies as an 'emerging growth company' and has elected to use the extended transition period for complying with new or revised financial accounting standards[42](index=42&type=chunk)[43](index=43&type=chunk) [2. REVENUE FROM CONTRACTS WITH CUSTOMERS](index=14&type=section&id=2.%20REVENUE%20FROM%20CONTRACTS%20WITH%20CUSTOMERS) This note details revenue recognition policies and disaggregates revenue by client and delivery location - Revenue from contact center services is recognized as services are performed, digital services at a point in time upon consumer activation/purchase, and CX software-as-a-service over the subscription term[46](index=46&type=chunk)[47](index=47&type=chunk)[48](index=48&type=chunk) Client Location | Client Location | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :---------------- | :------------------------------------------ | :------------------------------------------ | | United States | 121,184 | 123,913 | | Other countries | 3,425 | 3,892 | | Total | 124,609 | 127,805 | Service Delivery Location | Service Delivery Location | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Onshore (United States) | 31,536 | 38,177 | | Offshore (Philippines, Pakistan) | 57,359 | 51,156 | | Nearshore (Jamaica, Nicaragua, Honduras) | 35,714 | 38,472 | | Total | 124,609 | 127,805 | [3. ACCOUNTS RECEIVABLE AND SIGNIFICANT CLIENTS](index=16&type=section&id=3.%20ACCOUNTS%20RECEIVABLE%20AND%20SIGNIFICANT%20CLIENTS) This note provides information on accounts receivable, credit losses, and client concentration Accounts Receivable and Allowance for Credit Losses | Metric | September 30, 2023 ($000s) | June 30, 2023 ($000s) | | :-------------------------- | :-------------------------- | :------------------- | | Accounts receivable, net | 90,114 | 86,364 | | Allowance for credit losses | (131) | (120) | - One client contributed **12%** of total revenue for the three months ended September 30, 2023, down from **14%** in the prior year[55](index=55&type=chunk) [4. LEASES](index=16&type=section&id=4.%20LEASES) This note presents details on the company's operating and finance lease costs and liabilities Lease Costs | Lease Cost Type | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Total operating lease cost | 5,667 | 6,339 | | Total finance lease cost | 143 | 99 | Lease Liabilities | Lease Liability | September 30, 2023 ($000s) | June 30, 2023 ($000s) | | :-------------------------- | :-------------------------- | :------------------- | | Total operating lease liabilities | 74,072 | 77,890 | | Total finance lease liabilities | 977 | 961 | - The weighted average remaining lease term for operating leases was **5.5 years** as of September 30, 2023[60](index=60&type=chunk) [5. DERIVATIVES](index=19&type=section&id=5.%20DERIVATIVES) This note explains the company's use of foreign currency hedges and their fair values - The Company uses foreign currency exchange contracts (collars) to mitigate foreign exchange fluctuations on the Philippine Peso (PHP) operating costs, designated as cash flow hedges[62](index=62&type=chunk) Fair Value of Foreign Currency Option Contracts | Metric | September 30, 2023 ($000s) | June 30, 2023 ($000s) | | :-------------------------- | :-------------------------- | :------------------- | | Fair value of foreign currency option contracts - liabilities | 316 | 100 | - Aggregate unrealized net loss in Accumulated Other Comprehensive Income (AOCI) from cash flow hedges was **$374 thousand** as of September 30, 2023[65](index=65&type=chunk) [6. DEBT](index=20&type=section&id=6.%20DEBT) This note provides information on the company's total debt and available borrowing capacity Debt Breakdown | Metric | September 30, 2023 ($000s) | June 30, 2023 ($000s) | | :-------------------------- | :-------------------------- | :------------------- | | Total debt | 977 | 1,013 | | Current maturities of long-term debt | (396) | (413) | | Total long-term debt, net | 581 | 600 | - As of September 30, 2023, the Company had **$72.6 million** of borrowing available under the PNC Credit Facility and was in compliance with all debt covenants[66](index=66&type=chunk)[67](index=67&type=chunk) [7. CONTINGENCIES AND COMMITMENTS](index=21&type=section&id=7.%20CONTINGENCIES%20AND%20COMMITMENTS) This note discusses the company's exposure to claims, lawsuits, and indemnification agreements - The Company is subject to claims and lawsuits in the ordinary course of business but does not believe any will have a material adverse effect on its financial position[68](index=68&type=chunk) - The Company enters into indemnification agreements with clients and vendors, but historically has not experienced significant losses from these obligations[69](index=69&type=chunk) [8. WARRANT](index=21&type=section&id=8.%20WARRANT) This note details a warrant issued to Amazon, including its terms, vesting, and related contra revenue - A 10-year warrant was issued to Amazon to acquire approximately **1.67 million** common shares at **$9.42 per share**, with vesting tied to Amazon's service purchases[70](index=70&type=chunk)[71](index=71&type=chunk) - As of September 30, 2023, **1,004,410** warrant shares were vested, and the warrant has not been exercised[72](index=72&type=chunk) - The Company recorded contra revenue of approximately **$0.3 million** for the three months ended September 30, 2023 and 2022, respectively[72](index=72&type=chunk) [9. SHARE BASED COMPENSATION](index=22&type=section&id=9.%20SHARE%20BASED%20COMPENSATION) This note outlines the company's share-based compensation expense and unrecognized compensation Share-Based Compensation Expense | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Total share-based compensation expense | 848 | 1,122 | - As of September 30, 2023, there was **$7.3 million** of total unrecognized compensation expense related to non-vested share-based awards, expected to be recognized over a weighted-average period of **3.5 years**[74](index=74&type=chunk) [10. FAIR VALUE](index=22&type=section&id=10.%20FAIR%20VALUE) This note describes the fair value hierarchy for derivatives and phantom stock awards - Derivative instruments (cash flow hedges) and phantom stock awards are classified as **Level 2** in the fair value hierarchy, using observable market inputs[79](index=79&type=chunk)[80](index=80&type=chunk) Fair Value of Liabilities | Liabilities ($000s) | September 30, 2023 (Level 2) | June 30, 2023 (Level 2) | | :-------------------------- | :-------------------------- | :------------------- | | Cash flow hedge - foreign currency collars, net | 316 | 100 | | Phantom stock options | 724 | 1,173 | | Total liabilities | 1,040 | 1,273 | [11. INCOME TAXES](index=23&type=section&id=11.%20INCOME%20TAXES) This note presents the company's income tax provision, effective tax rate, and impact of tax holidays Income Tax Provision and Effective Tax Rate | Metric | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Provision for income taxes ($000s) | 1,388 | 1,047 | | Effective tax rate | 15.7% | 13.8% | - Tax holidays in Nicaragua, Pakistan, Honduras, Jamaica, and the Philippines reduced income tax expense by **$1.4 million** (**$0.07 per diluted share**) for the three months ended September 30, 2023[86](index=86&type=chunk) [12. STOCKHOLDERS' EQUITY](index=24&type=section&id=12.%20STOCKHOLDERS'%20EQUITY) This note provides details on accumulated other comprehensive income and the share repurchase program Accumulated Other Comprehensive Income (AOCI) | AOCI Component ($000s) | September 30, 2023 | September 30, 2022 | | :-------------------------- | :-------------------------- | :------------------- | | Foreign Currency Translation Adjustment | (6,961) | (5,703) | | Derivative Valuation | (318) | (900) | | Defined Benefit Plan | 72 | 103 | | Total AOCI | (7,207) | (6,500) | - The Board authorized a **$30 million** share repurchase program on September 18, 2023. During the three months ended September 30, 2023, **134,524 shares** were repurchased for **$2.0 million**[89](index=89&type=chunk) [13. WEIGHTED AVERAGE SHARE COUNTS](index=25&type=section&id=13.%20WEIGHTED%20AVERAGE%20SHARE%20COUNTS) This note presents basic and diluted weighted average share counts for earnings per share calculations Weighted Average Shares | Shares (000s) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Basic | 18,287 | 18,141 | | Diluted | 18,898 | 18,641 | [14. RELATED PARTY TRANSACTIONS](index=25&type=section&id=14.%20RELATED%20PARTY%20TRANSACTIONS) This note discloses revenue and accounts payable related to transactions with related parties - The Company recognized **$0.01 million** in revenue from related parties for the three months ended September 30, 2023 and 2022[91](index=91&type=chunk) - Accounts payable to related parties decreased significantly to **$0.1 million** as of September 30, 2023, from **$2.3 million** as of June 30, 2023[91](index=91&type=chunk) [15. INVESTMENT IN JOINT VENTURE](index=25&type=section&id=15.%20INVESTMENT%20IN%20JOINT%20VENTURE) This note describes the company's equity method investment in Lake Ball, LLC, and its share of profit - The Company holds a **47.5%** ownership interest in Lake Ball, LLC, accounted for under the equity method[92](index=92&type=chunk) Share of Profit from Joint Venture | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Share of profit | 270 | 152 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial performance, condition, and future outlook, discussing key trends, operational results, and liquidity, including a detailed analysis of revenue, expenses, and non-GAAP financial measures [Overview](index=26&type=section&id=Overview) This section describes IBEX's business, service offerings, and operational scale - IBEX delivers innovative business process outsourcing (BPO), smart digital marketing, online acquisition technology, and end-to-end customer engagement solutions[96](index=96&type=chunk) - The company operates **31 global CX delivery centers** with approximately **30,000 employees**, managing nearly **176 million** customer interactions annually[96](index=96&type=chunk) [Business Highlights](index=26&type=section&id=Business%20Highlights) This section summarizes recent achievements, including strong financial performance and new client acquisitions - The Company delivered strong financial performance, particularly growth in digital-first solutions with HealthTech and Retail & E-commerce clients[97](index=97&type=chunk) - Achieved profit and margin expansion, strong free cash flows, and new client wins despite macroeconomic trends[97](index=97&type=chunk) [Recent Financial Highlights](index=26&type=section&id=Recent%20Financial%20Highlights) This section presents key financial metrics for the quarter, including revenues, net income, and diluted EPS Key Financial Metrics | Metric | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Revenues ($M) | 124.6 | 127.8 | -2.5% | | Net income ($M) | 7.4 | 6.5 | +13.8% | | Fully diluted earnings per share | 0.39 | 0.35 | +12.3% | - Revenue decline was due to external factors impacting the FinTech vertical, partially offset by increases in Retail & E-commerce and HealthTech verticals[98](index=98&type=chunk) [Trends and Factors Affecting our Performance](index=26&type=section&id=Trends%20and%20Factors%20Affecting%20our%20Performance) This section discusses internal and external factors influencing the company's financial and operational performance [Macroeconomic Trends](index=27&type=section&id=Macroeconomic%20Trends) This section analyzes how macroeconomic conditions impact revenue and operational shifts - Macroeconomic factors, including inflation and rising interest rates, led to a modest decline in revenue and a shift of work from onshore to offshore sites[100](index=100&type=chunk) [Artificial Intelligence ("AI")](index=27&type=section&id=Artificial%20Intelligence%20(%22AI%22)) This section highlights the company's strategic initiatives in leveraging generative AI for productivity and customer insights - The company is aggressively developing its 'Next wave of Wave X' by leveraging generative AI to increase agent productivity, provide deeper customer insights, and integrate AI into the customer journey[102](index=102&type=chunk) [Client's Underlying Business Performance](index=27&type=section&id=Client's%20Underlying%20Business%20Performance) This section explains how client business performance and macroeconomic conditions affect demand for services - Demand for customer interaction services is influenced by client business performance; demand was constrained in Q1 2024 due to macroeconomic conditions[103](index=103&type=chunk) [Capacity Utilization](index=27&type=section&id=Capacity%20Utilization) This section discusses capacity utilization's impact on operating margins and new delivery capacity investments - Operating margins are impacted by capacity utilization; the company is investing in additional capacity in nearshore and offshore regions due to shifting demand[104](index=104&type=chunk)[105](index=105&type=chunk) [Labor Costs](index=28&type=section&id=Labor%20Costs) This section addresses managing wage pressures through productivity, retention, and shifts to lower-cost locations - Increasing wage pressure in all geographies is being offset by higher agent quality, increased productivity, improved retention, contractual cost of living adjustments (COLA), and a shift to lower-cost delivery locations[106](index=106&type=chunk) [Delivery Location](index=28&type=section&id=Delivery%20Location) This section emphasizes the profitability benefits of offshore and nearshore delivery locations - Offshore and nearshore geographies generate greater profit margins; approximately **94%** of workstations are in these regions as of September 30, 2023[107](index=107&type=chunk) [Provider Performance](index=28&type=section&id=Provider%20Performance) This section attributes revenue growth to strong performance, market share gains, and new client acquisitions - Revenues have generally increased due to performance-based market share gains with existing clients and new client wins[108](index=108&type=chunk) [Sales Cycles and New Client Wins](index=28&type=section&id=Sales%20Cycles%20and%20New%20Client%20Wins) This section notes lengthened sales cycles but anticipates increased activity in the upcoming fiscal year - Sales cycles have lengthened in the current slowing economic environment, but activity is expected to pick up throughout fiscal year 2024[109](index=109&type=chunk) [Client Concentration](index=28&type=section&id=Client%20Concentration) This section discloses the percentage of consolidated revenues from the largest and top three clients - The largest client accounted for **12%** of consolidated revenues, and the top three clients accounted for **30%** during the three months ended September 30, 2023[110](index=110&type=chunk) [Seasonality](index=28&type=section&id=Seasonality) This section cautions that business performance is subject to seasonal fluctuations, making quarter comparisons unreliable - Business performance is subject to seasonal fluctuations, meaning individual quarters should not be directly compared or used to predict annual results[110](index=110&type=chunk) [Pricing](index=29&type=section&id=Pricing) This section discusses pricing strategies, including negotiated increases and leveraging offshore shifts for margin improvement - The company successfully negotiated price increases or COLA with many clients due to global labor market tightening and wage inflation[111](index=111&type=chunk) - A shift in service delivery from onshore to offshore locations results in lower client prices but tends to increase percentage operating margins[112](index=112&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of revenue and operating expenses, explaining financial performance drivers [Revenue](index=29&type=section&id=Revenue) This section analyzes changes in total revenue and contributions from FinTech, Retail & E-commerce, and HealthTech verticals Revenue by Vertical | Vertical | Three Months Ended September 30, 2023 ($M) | Three Months Ended September 30, 2022 ($M) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Total Revenue | 124.6 | 127.8 | -2.5% | | FinTech (decrease) | -7.0 | - | -27.5% | | Retail and E-commerce (increase) | +1.9 | - | +7.0% | | HealthTech (increase) | +1.8 | - | +13.8% | Vertical as % of Total Revenue | Vertical as % of Total Revenue | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Retail and E-commerce | 23.4% | 21.3% | | HealthTech | 11.9% | 10.2% | | FinTech | 14.8% | 19.9% | [Operating Expenses](index=30&type=section&id=Operating%20Expenses) This section details the components of operating expenses, including cost of services, SG&A, and D&A [Cost of services](index=30&type=section&id=Cost%20of%20services) This section breaks down the cost of services, including payroll, facilities, and telecom expenses | Expense Category | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Cost of services | 88,196 | 96,153 | -8.3% | | Payroll and related costs | 66,800 | 73,600 | -9.2% | | Facilities expenses | 4,300 | 4,800 | -10.4% | | Telecom, printing, local transportation | 3,600 | 4,600 | -21.7% | - Payroll costs as a percentage of revenue decreased to **53.6%** from **57.6%** due to an increasing percentage of revenue from lower labor cost nearshore and offshore regions[117](index=117&type=chunk) [Selling, general and administrative expense ("SG&A")](index=30&type=section&id=Selling,%20general%20and%20administrative%20expense%20(%22SG%26A%22)) This section explains the increase in SG&A expenses due to higher payroll, IT, legal, and travel costs | Expense Category | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | SG&A | 23,040 | 19,305 | +19.3% | - Increase in SG&A was primarily due to higher payroll and related costs (**$1.6 million**), IT expenses (**$0.6 million**), legal and professional fees (**$1.2 million**), and travel expenses (**$0.5 million**)[120](index=120&type=chunk) [Depreciation and amortization expense ("D&A")](index=30&type=section&id=Depreciation%20and%20amortization%20expense%20(%22D%26A%22)) This section presents the company's depreciation and amortization expense and its percentage of revenue | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | D&A expense | 5,042 | 4,677 | +7.8% | | D&A as % of revenue | 4.0% | 3.7% | +0.3 pp | [Income from operations](index=30&type=section&id=Income%20from%20operations) This section analyzes the increase in income from operations and operating margin, driven by utilization and delivery mix | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Income from operations | 8,331 | 7,670 | +8.6% | | Operating margin | 6.7% | 6.0% | +0.7 pp | - The increase was primarily driven by margin expansion from higher capacity utilization and shifts to more profitable nearshore and offshore locations[122](index=122&type=chunk) [Interest income](index=30&type=section&id=Interest%20income) This section highlights the significant increase in interest income due to higher returns on invested funds | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Interest income | 586 | 48 | +1120.8% | - Interest income significantly increased due to higher income on invested funds[123](index=123&type=chunk) [Interest expense](index=30&type=section&id=Interest%20expense) This section presents the company's interest expense for the reported periods | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Interest expense | (104) | (148) | [Provision for Income Taxes](index=31&type=section&id=Provision%20for%20Income%20Taxes) This section explains the increase in income tax expense, primarily due to higher pre-tax income | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Income tax expense | 1,388 | 1,047 | +32.6% | - Income tax expense increased primarily due to higher pre-tax income in the current year[125](index=125&type=chunk) [Non-GAAP Financial Measures](index=31&type=section&id=Non-GAAP%20Financial%20Measures) This section provides reconciliations and discussions of non-GAAP financial measures used to assess performance [Adjusted net income and adjusted earnings per share](index=31&type=section&id=Adjusted%20net%20income%20and%20adjusted%20earnings%20per%20share) This section presents adjusted net income and adjusted earnings per share, with year-over-year changes Adjusted Net Income and EPS | Metric | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Net income ($000s) | 7,425 | 6,523 | +13.8% | | Adjusted net income ($000s) | 7,574 | 6,798 | +11.4% | | Diluted earnings per share | 0.39 | 0.35 | +12.3% | | Adjusted earnings per share | 0.40 | 0.36 | +11.1% | [EBITDA, adjusted EBITDA, and adjusted EBITDA margin](index=32&type=section&id=EBITDA,%20adjusted%20EBITDA,%20and%20adjusted%20EBITDA%20margin) This section provides EBITDA, adjusted EBITDA, and adjusted EBITDA margin, highlighting profitability improvements EBITDA and Adjusted EBITDA | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | EBITDA | 13,959 | 12,395 | +12.6% | | Adjusted EBITDA | 13,711 | 12,906 | +6.2% | | Adjusted EBITDA margin | 11.0% | 10.1% | +0.9 pp | - Adjusted EBITDA margin improved due to stronger operating results from higher capacity utilization and an increased mix of higher margin nearshore and offshore delivery[138](index=138&type=chunk) [Free cash flow](index=33&type=section&id=Free%20cash%20flow) This section details the company's free cash flow, showing a significant increase from operating activities Free Cash Flow | Metric | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | YoY Change | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Net cash provided by operating activities | 8,684 | 5,562 | +56.1% | | Capital expenditures | 2,052 | 3,558 | -42.3% | | Free cash flow | 6,632 | 2,004 | +230.9% | [Net cash](index=34&type=section&id=Net%20cash) This section presents the company's net cash position, calculated as cash and equivalents less total debt Net Cash Position | Metric | September 30, 2023 ($000s) | June 30, 2023 ($000s) | | :-------------------------- | :-------------------------- | :------------------- | | Cash and cash equivalents | 62,029 | 57,429 | | Total debt | 977 | 1,013 | | Net cash | 61,052 | 56,416 | [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses liquidity sources, including cash, operating cash flows, credit facilities, and share repurchases - Principal sources of liquidity as of September 30, 2023, were **$62.0 million** in cash and cash equivalents, cash flows from operations, and **$72.6 million** unused availability under existing credit facilities[144](index=144&type=chunk) - The Company repurchased **134,524** common shares for **$2.0 million** under a **$30 million** share repurchase program during the three months ended September 30, 2023[149](index=149&type=chunk) Cash Flow Activities | Cash Flow Activity | Three Months Ended September 30, 2023 ($000s) | Three Months Ended September 30, 2022 ($000s) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | | Net cash inflow from Operating activities | 8,684 | 5,562 | | Net cash outflow from Investing activities | (2,052) | (3,558) | | Net cash outflow from Financing activities | (1,967) | (7,666) | [Critical Accounting Policies and Estimates](index=36&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms no material changes to critical accounting policies and estimates, noting capitalized cloud computing costs - There have been no material changes to the Company's significant accounting policies or critical accounting estimates as reported in the Annual Report[159](index=159&type=chunk) - The Company capitalized **$0.4 million** in qualifying implementation costs for cloud computing software (ERP and HCM systems) during the three months ended September 30, 2023[160](index=160&type=chunk) [Recent Accounting Pronouncements](index=36&type=section&id=Recent%20Accounting%20Pronouncements) This section refers to Note 1 for information on recently adopted accounting pronouncements - Refer to Note 1, 'Overview and Summary of Significant Accounting Policies,' for additional information regarding recently adopted accounting pronouncements[161](index=161&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=36&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section discusses the company's exposure to financial and market risks, primarily foreign currency exchange risk and interest rate risk, and the strategies employed to mitigate them [Foreign currency exchange risk](index=37&type=section&id=Foreign%20currency%20exchange%20risk) This section identifies primary foreign currency exposures and hedging strategies to mitigate fluctuations - The Company's primary foreign currency exposures are in Philippine Peso (PHP), Jamaican Dollar, and Pakistani Rupee, due to a substantial portion of costs being denominated in local currencies[163](index=163&type=chunk) - A **10%** appreciation/depreciation in PHP would impact expenses by approximately **$2.8 million** / **$2.3 million**, respectively[165](index=165&type=chunk) - The Company hedges a portion of its Philippine operating costs to mitigate foreign exchange fluctuations[164](index=164&type=chunk) [Interest rate risk](index=37&type=section&id=Interest%20rate%20risk) This section describes interest rate risk exposure related to cash and credit facilities, noting no material impact - The Company's exposure to interest rate risk relates primarily to cash and bank balances and credit facilities[167](index=167&type=chunk) - As of September 30, 2023, the total principal balance outstanding under the PNC Credit Facility was **$0.00 million**, indicating no material impact from a hypothetical **10%** change in SOFR[167](index=167&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=37&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) This section reports on the evaluation of disclosure controls and procedures, identifying a material weakness in internal control over financial reporting related to complex non-routine transactions, and the ongoing remediation efforts [Evaluation of Disclosure Controls and Procedures](index=37&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section reports on the ineffectiveness of disclosure controls due to a material weakness in internal control - Management concluded that disclosure controls and procedures were not effective as of September 30, 2023, due to a material weakness in internal control over financial reporting related to complex non-routine transactions[169](index=169&type=chunk)[170](index=170&type=chunk) - The material weakness has not been remediated as of September 30, 2023, as the remediation plan is ongoing[171](index=171&type=chunk) [Changes in Internal Control Over Financial Reporting](index=38&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) This section states no material changes occurred in internal controls, apart from ongoing remediation for the material weakness - Except for the ongoing remediation plan for the material weakness, there have been no material changes in internal controls over financial reporting during the quarter ended September 30, 2023[172](index=172&type=chunk) [PART II. OTHER INFORMATION](index=39&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part includes disclosures on legal proceedings, risk factors, equity sales, defaults, and exhibits [Item 1. Legal Proceedings](index=39&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 7 for legal proceedings, indicating no anticipated material adverse effects - Information regarding legal proceedings can be found under Note 7, 'Contingencies and Commitments,' in the unaudited consolidated financial statements[175](index=175&type=chunk) [Item 1A. Risk Factors](index=39&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the Form 10-K for risk factors, confirming no material changes in this report - The Company is subject to various risks, as discussed under 'Risk Factors' in the Annual Report on Form 10-K, with no material changes noted in this Form 10-Q[176](index=176&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=39&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section details the company's share repurchase program, including shares bought back and remaining authorization - The Board authorized a share repurchase program on September 18, 2023, allowing the Company to repurchase up to **$30 million** of its shares over six months[177](index=177&type=chunk) Issuer Purchases of Equity Securities | Period | Total Number of Shares Purchased | Average Price Paid per Share | Approximate Dollar Value Remaining Under the Program ($000s) | | :-------------------------- | :------------------------------- | :--------------------------- | :----------------------------------------------------------- | | September 1 - September 30, 2023 | 134,524 | $15.15 | 27,962 | [Item 3. Defaults Upon Senior Securities](index=40&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section confirms no defaults on senior securities during the reporting period - There were no defaults upon senior securities[183](index=183&type=chunk) [Item 4. Mine Safety Disclosures](index=40&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that mine safety disclosures are not applicable to the company's operations - Mine Safety Disclosures are not applicable to the Company[184](index=184&type=chunk) [Item 5. Other Information](index=40&type=section&id=Item%205.%20Other%20Information) This section reports no director or officer adopted or terminated Rule 10b5-1 trading arrangements during the quarter - No Company director or officer adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the quarter ended September 30, 2023[185](index=185&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section provides an index of all exhibits filed with the Form 10-Q, including legal and financial documents - The exhibit index includes documents such as the Memorandum of Association, Amended and Restated By-laws, Executive Employment Agreement, CEO and CFO Certifications, and Inline XBRL documents[188](index=188&type=chunk) [Signatures](index=42&type=section&id=Signatures) This section contains the official certifications and signatures of the Chief Executive Officer and Chief Financial Officer - The report was signed by Robert Dechant, Chief Executive Officer, and Taylor Greenwald, Chief Financial Officer, on November 9, 2023[190](index=190&type=chunk)

IBEX Limited (NASDAQ:IBEX) Q4 2023 Earnings Conference Call September 13, 2023 4:30 PM ET Company Participants Michael Darwal - Investor Relations Bob Dechant - Chief Executive Officer Taylor Greenwald - Chief Financial Officer Conference Call Participants Ryan Potter - Citi Matthew Roswell - RBC Robert Bamberger - Baird Operator Welcome to the ibex's Fourth Quarter and Full Year 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 -_________________________ Form 10-K _________________________ (Mark One) x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number 001-38442 IBEX LIMITED (Exact name of Registrant as ...

IBEX Limited (NASDAQ:IBEX) Q3 2023 Earnings Conference Call May 17, 2023 4:30 PM ET Company Participants Michael Darwal - Investor Relations Bob Dechant - Chief Executive Officer Karl Gabel - Chief Financial Officer Conference Call Participants David Koning - Baird Tobey Sommer - Truist Ryan Potter - Citi Operator Welcome to the IBEX's Third Quarter [Full] (ph) Year 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a Q&A ...

Exhibit 99.1 IBEX Limited Announces Third Quarter of Fiscal Year 2023 Financial Results with Record Net Income and Adjusted EBITDA Margins Key Highlights WASHINGTON, DC— May 17, 2023—IBEX Limited ("ibex"), a leading global provider in business process outsourcing and end-to-end customer engagement technology solutions, today announced financial results for its third fiscal quarter ended March 31, 2023. "We delivered an outstanding third quarter achieving record adjusted EBITDA margin of 18.5%. We continue t ...

| --- | --- | --- | |------------------------------------------------------------------|-------|------------------------| | | | | | | | | | | | | | | | Built for what's next. | | February 15, 2023 ibex Q2 FY2023 Earnings Call Bob Dechant, CEO | | | | | | | Disclaimer Except as required by law, we assume no duty to update any of these forward-looking statements after the date of this presentation to conform these statements to actual results or revised expectations. You should, therefore, not rely on these f ...

Financial Data and Key Metrics Changes - Revenue grew to $139.4 million, up 12.6% when normalizing for the exit of a low-margin client, with a trailing 12-month revenue increase of 13% to $520.1 million [29][39] - Adjusted EBITDA margin reached 18%, up 450 basis points from the prior year, with adjusted EBITDA increasing to $25.1 million [28][41] - Net income decreased to $1.9 million from $8.5 million in the prior year, primarily due to the reevaluation of share warrants [40] Business Line Data and Key Metrics Changes - BPO 2.0 clients grew by 16.9% year-over-year, now representing 77.3% of total revenue [39] - Retail and e-commerce vertical increased to 26.9% of revenue, while FinTech and HealthTech grew to 27.9% [44][51] - Technology and travel/transportation verticals decreased to 8.7% and 11.4% of revenue, respectively, due to client exits and macroeconomic pressures [54] Market Data and Key Metrics Changes - Top five client concentration decreased to 40.8% from 41.3%, and top ten clients accounted for 58.8% of total revenue, down from 61% [43] - The sales pipeline increased to over $400 million, up 40% from a year ago [30] Company Strategy and Development Direction - The company is focused on diversifying its client base and has successfully mitigated the impact of the macroeconomic environment [31] - Strategic decisions made during the pandemic to expand capacity in high-margin regions are proving beneficial for profitability [49] - The company aims to continue driving growth through operational excellence and strong client relationships [88] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's resilience and growth trajectory despite macroeconomic challenges [36][37] - The company raised its adjusted EBITDA guidance for the full year to $82 million to $84 million, reflecting strong performance and visibility [47] - Management noted that the current operating model has resumed to pre-COVID levels, allowing for margin expansion [52] Other Important Information - The company has approximately $110 million in cash and borrowing availability, with less than $5 million in borrowings [35] - The company will transition to U.S. GAAP financial reporting effective July 1, 2023 [56] Q&A Session Summary Question: Revenue outlook and seasonal impacts - Management highlighted a more balanced client mix that mitigates historical seasonality, with strong wins in healthcare and financial services providing confidence for the second half of the year [60][61] Question: Margin sustainability and drivers - Management confirmed that the strong margins are not one-time events and are driven by BPO 2.0 solutions and COLA price increases [63] Question: Outsourcing spend trends among new economy customers - Management noted that while some clients are reducing outsourcing spend due to disruptions, there is potential for increased outsourcing as companies reassess strategies post-layoffs [76][77] Question: Growth potential and sales pipeline - Management indicated that the sales pipeline and operational performance position the company well for continued growth, even in a challenging environment [88][89]

IBEX Limited Announces Strong Second Quarter of Fiscal Year 2023 Financial Results with Accelerating Adjusted EBITDA, Strong Revenue Growth and Cash Flow; Raises Adjusted EBITDA Guidance Key Highlights WASHINGTON, DC— February 15, 2023—IBEX Limited ("ibex"), a leading global provider in business process outsourcing and end-to-end customer engagement technology solutions, today announced financial results for its second quarter ended December 31, 2022. Exhibit 99.1 "We delivered on a tremendous second quarte ...