Ebix(US:EBIX)2021-08-08 16:00Revenue Growth - Total operating revenues for the three months ended June 30, 2021, increased by $135.0 million, or 121%, to $246.3 million compared to $111.3 million in the same period of 2020[184]. - International revenue accounted for 84.7% of total revenue for the three months ended June 30, 2021, compared to 62.5% in the same period of 2020[184]. - Revenue from EbixCash exchanges increased to $189.9 million for the three months ended June 30, 2021, up from $53.2 million in the same period of 2020[182]. - The demand for payment solutions offerings in India, particularly prepaid gift cards, increased by more than $128 million year-over-year, representing a growth of over 375%[184]. - Total operating revenues for the six months ended June 30, 2021, increased by $287.2 million, or 115%, to $536.4 million compared to $249.2 million for the same period in 2020[196]. Cost and Expenses - Cost of services provided increased by $129.1 million, or 263%, to $178.2 million in the second quarter of 2021 compared to $49.1 million in the second quarter of 2020[185]. - Cost of services as a percentage of total revenues rose to 72.3% for the three months ended June 30, 2021, compared to 44.1% for the same period in 2020[185]. - General and administrative expenses increased by $7.9 million, or 51%, to $23.3 million in Q2 2021 compared to $15.5 million in Q2 2020[188]. - Product development expenses increased by $1.8 million, or 22%, to $10.1 million in Q2 2021 compared to $8.3 million in Q2 2020[186]. Financial Position - Cash and cash equivalents decreased to $85.1 million at June 30, 2021, from $105.0 million at December 31, 2020[212]. - The current ratio increased to 1.96 at June 30, 2021, from 1.89 at December 31, 2020[214]. - The company recorded a net foreign currency exchange gain of $9 thousand for Q2 2021[194]. - Net income tax expense was $627 thousand (4.03%) for Q2 2021, with an expected full-year effective tax rate of 2.5% to 3.5%[195]. Debt and Financing - The company had $663.6 million in outstanding debt obligations as of June 30, 2021, including a $224.2 million term loan and a $439.4 million balance on its revolving line of credit[276]. - The outstanding balance on the revolving line of credit was $439.4 million as of June 30, 2021, with an interest rate of 5.50%, up from 3.50% at December 31, 2020[233]. - The outstanding balance on the Term Loan was $224.2 million as of June 30, 2021, with $31.3 million of principal payments made during the first half of 2021[234]. - Net cash used by financing activities for the six months ended June 30, 2021 was $43.1 million, including $31.3 million for scheduled payments on the existing term loan[226]. Cash Flow - Net cash provided by operating activities for the six months ended June 30, 2021 was $21.7 million, with a net income of $37.3 million and working capital requirements of $(28.3) million[221]. - Net cash used for investing activities during the six months ended June 30, 2021 was $6.4 million, primarily for software development costs of $3.1 million and capital expenditures of $1.7 million[223]. - In the first half of 2020, net cash used for investing activities was $36.5 million, mainly for acquisition-related payments of $5.2 million and software development costs of $3.3 million[224]. Market and Operational Impact - The company continues to monitor the impact of COVID-19 on its operations and has taken measures to strengthen its financial position[180]. - COVID-19 continues to create uncertainty in global financial markets, potentially impacting demand for services and overall business performance[239]. - The company has not experienced any material changes to its internal controls over financial reporting despite remote work due to the COVID-19 pandemic[281]. - The company continually monitors the impact of COVID-19 on the effectiveness of its internal control over financial reporting[281]. Revenue Recognition - EbixCash Travel revenue is recognized at a point in time, primarily from commissions and transaction fees, including hotel rooms, airline tickets, and ancillary fees[249]. - For corporate MICE packages, revenue is recognized at full purchase value upon completion, with costs recorded under direct expenses, reflecting EbixCash's role as the principal in transactions[251]. - EbixCash's money transfer business recognizes revenue upon completion of the transfer process, which includes a transaction fee and exchange rate differences[252]. - The company’s foreign exchange and payment services recognize revenue when performance obligations are fulfilled, typically when payments are made to recipients[253]. - Consumer payment services vary in fee structures based on customer relationships and service offerings, with revenue recognized based on contractual agreements[254]. - Insurance Exchanges revenue is derived from SaaS platform fees, with setup and customization services accounted for as a single performance obligation over the contract duration[256]. Foreign Currency and Market Risk - During the six months ended June 30, 2021, the company experienced unrealized foreign currency translation losses of $(12.5) million[275]. - A hypothetical 30% increase in the LIBOR rate could have reduced pre-tax income by approximately $0.5 million for the six months ended June 30, 2021[276]. - A hypothetical 20% adverse change in foreign currency exchange rates could have resulted in a reduction to pre-tax income of approximately $5.2 million for the six months ended June 30, 2021[275]. - There were no material changes to the company's market risk exposure during the six months ended June 30, 2021[277]. - The company maintains a system of disclosure controls and procedures to ensure accurate reporting in compliance with SEC rules[279].