TELUS International(US:TIXT)2025-02-13 12:00Accounting Standards and Financial Reporting - The new accounting standard will be effective for annual reporting periods beginning on or after January 1, 2027, with limited shifts in financial disclosures expected [921]. - The company is currently assessing the impacts of the amendments to the classification and measurement of financial instruments, effective January 1, 2026, but does not expect material effects [922]. - The annual consolidated financial statements are presented in accordance with International Financial Reporting Standards (IFRS) for the years ending December 31, 2024 and 2023 [20]. - All monetary amounts in the report are in U.S. dollars, with specific references to Canadian dollars and euros as applicable [21]. Financial Performance - Total revenue for 2024 was $2,658 million, a slight decrease from $2,708 million in 2023, with the largest industry vertical being Tech and Games at $1,121 million [927]. - For the year ended December 31, 2024, the company reported a net loss of $61 million, compared to a net income of $54 million in 2023 and $183 million in 2022 [961]. - The diluted loss per share for 2024 was $(0.34), a decrease from $0.18 in 2023 and $0.68 in 2022 [963]. - The company reported a net income of $16 million for 2024, an increase from $10 million in 2023 and $8 million in 2022 [985]. - Total revenue for 2024 was $2,658 million, a decrease of 1.85% compared to $2,708 million in 2023 [1050]. Revenue Breakdown - Revenue by geographic region for 2024 included $781 million from Europe, $757 million from North America, and $606 million from Asia-Pacific [928]. - Revenue from the United States was $455 million in 2024, down from $520 million in 2023, a decline of 12.5% [1050]. - The Philippines generated $437 million in revenue in 2024, a decrease of 6.22% from $466 million in 2023 [1050]. - Revenues from services provided to TELUS and its subsidiaries for the year ended December 31, 2024, amounted to $656 million, an increase from $559 million in 2023 and $428 million in 2022 [1031]. - TELUS accounted for approximately 24.7%, 20.6%, and 15.8% of the company's revenue for the years ended December 31, 2024, 2023, and 2022 respectively [1042]. - Google accounted for approximately 14.3%, 13.1%, and 10.9% of the company's revenue for the years ended December 31, 2024, 2023, and 2022 respectively [1042]. Expenses and Compensation - Salaries and benefits for 2024 totaled $1,701 million, an increase from $1,664 million in 2023 [929]. - Share-based compensation expense for 2024 was $32 million, up from $21 million in 2023 [930]. - Total compensation expense for key management personnel in 2024 was $16 million, compared to $18 million in 2023 and $19 million in 2022 [1039]. - The company awarded 1,259,640 RSUs and 839,016 PSUs to key management personnel in 2024, with a grant-date fair value of $17 million [1039]. - Defined contribution pension expense recognized in salaries and benefits for the years ended December 31, 2024, 2023, and 2022 was $4 million, $2 million, and $2 million respectively [1024]. Debt and Financing - The company amended and expanded its credit facility to an aggregate $2.0 billion, consisting of an $800 million revolving credit facility and $1.2 billion in term loans payable in five years [926]. - As of December 31, 2024, the total long-term debt was $1,525 million, a decrease from $1,750 million in 2023, reflecting a reduction of approximately 12.9% [10]. - The credit facility includes an $800 million revolving credit facility and a $1.2 billion term loan, with an effective interest rate reduced to 6.5% from 7.5% in 2023 [12]. - The anticipated long-term debt repayments for 2025 are projected at $60 million, with total future cash outflows for principal repayments amounting to $1,390 million [16]. - The company was in compliance with all financial covenants and ratios as of December 31, 2024, maintaining a Net Debt to Adjusted EBITDA ratio not exceeding 3.75:1.00 [14]. Assets and Acquisitions - As of December 31, 2023, total property, plant, and equipment amounted to $1,050 million, an increase from $862 million at the beginning of the year, reflecting a growth of approximately 22% [995]. - The net book value of intangible assets and goodwill as of December 31, 2023, was $3,509 million, up from $2,713 million at the beginning of 2022, indicating a growth of about 29% [997]. - In 2023, the company completed three acquisitions, including 86% of WillowTree for $1,175 million, contributing to a total goodwill of $599 million recognized from these acquisitions [1002]. - The company acquired a business in the first quarter of 2024 for $3 million, enhancing its customer experience delivery capabilities in the Asia-Pacific region [997]. - Total identifiable assets acquired from the 2023 acquisitions were valued at $799 million, with total liabilities assumed at $221 million [1003]. Risk Management - The company has a total maximum exposure to credit risk of $672 million as of December 31, 2024, compared to $703 million in 2023 [971]. - The company plans to manage liquidity risk by maintaining a syndicated bank credit facility and continuously monitoring cash flows [976]. - The primary operating currency is the United States dollar, with significant exposure to the European euro, Philippine peso, and Canadian dollar [978]. - The company uses foreign currency forward contracts and swaps to manage currency risk associated with foreign transactions [979]. - Interest rate risk is managed through the use of interest rate swaps to fix rates on the variable portion of the credit facility [982]. Future Outlook and Strategy - The company emphasizes the importance of executing its growth strategy, which includes expanding services to existing clients and attracting new clients [15]. - The company plans to maintain competitiveness by investing in new technologies and digital transformation capabilities [15]. - The company aims to integrate acquisitions that align with its strategy to enhance core capabilities and solutions [15]. - The company acknowledges the impact of global conditions, including macroeconomic uncertainty and inflation, on its business and clients [15]. - The company recognizes the high degree of uncertainty and risk associated with future performance estimates and projections [19].