IBEX(US:IBEX)2021-02-19 04:15Financial 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]