Concentrix : Historical Metrics

Concentrix Historical Financial Results	Unaudited	Audited	Unaudited
(in thousands)	2023	2024

GAAP Consolidated Income Statement	Q1 Q2 Q3 Q4 YTD 2023	Q1 Q2 Q3 Q4 YTD 2024
Revenue
Industry vertical:
Technology and consumer electronics	$ 516,608 $ 504,204 $ 528,281 $ 656,741 $2,205,834	$ 665,102 $ 665,102
Retail, travel and ecommerce	305,504 307,952 322,394 512,816 1,448,666	583,712 583,712
Communications and media	256,987 257,794 252,497 350,416 1,117,694	380,165 380,165
Banking, financial services and insurance	259,653 261,964 246,771 323,465 1,091,853	365,422 365,422
Healthcare	177,824 164,708 167,428 186,306 696,266	191,089 191,089
Other	119,828 118,084 115,463 201,018 554,393	217,258 217,258
Total revenue	$1,636,404 $1,614,706 $1,632,834 $2,230,762 $7,114,706	$2,402,748 $2,402,748
Revenue	$1,636,404 $1,614,706 $1,632,834 $2,230,762 $7,114,706	$2,402,748 $2,402,748
Cost of revenue	1,055,243 1,034,481 1,039,142 1,407,905 4,536,771	1,546,219 1,546,219
Gross profit	581,161 580,225 593,692 822,857 2,577,935	856,529 856,529
Selling, general and administrative expenses	425,114 417,659 431,425 642,410 1,916,608	708,090 708,090
Operating income	156,047 162,566 162,267 180,447 661,327	148,439 148,439
Interest expense and finance charges, net	33,990 47,213 49,293 70,508 201,004	82,439 82,439
Other (income) expense, net	3,714 9,383 6,169 32,829 52,095	(6,824) (6,824)
Income before income taxes	118,343 105,970 106,805 77,110 408,228	72,824 72,824
Provision for income taxes	30,473 27,120 29,170 7,623 94,386	20,722 20,722
Net income	$ 87,870 $ 78,850 $ 77,635 $ 69,487 $ 313,842	$ 52,102 $ 52,102
Basic earnings per common share	$ 1.69 $ 1.51 $ 1.50 $ 1.10 $ 5.72	$ 0.76 $ 0.76
Diluted earnings per common share $ 1.68 $ 1.51 $ 1.49 $ 1.09 $ 5.70 $ 0.76 $ 0.76

Non-GAAP Financial information * Revenue

Proforma revenue growth Foreign currency translation

Proforma constant currency revenue growth

• $2,230,762 $7,114,706

• Q1 $1,636,404

  Q2 $1,614,706

  Q3 $1,632,834

  Q4

  YTD 2023

  Q1

  Q2

  Q3

  Q4

  YTD 2024

  $2,402,748

  1.7 %

  1.1 %

  2.8 %

  Pro forma revenue (a)

  (a) Proforma revenue, which is revenue as if the combination with Webhelp was completed on December 1, 2022

  Operating income

  Acquisition-related and integration expenses Step-up depreciation

  Amortization of intangibles Share-based compensation Non-GAAP operating incomeNet income

  Interest expense and finance charges, net Provision for income taxes

  Other (income) expense, net Acquisition-related and integration expenses Step-up depreciation

  Amortization of intangibles Share-based compensation

  Depreciation (exclusive of step-up depreciation) Adjusted EBITDA

  $2,362,015

  $2,339,082

  $2,367,086

• $2,417,417 $9,485,600

$

• 156,047 $ 162,566

$ 162,267

$ 661,327

5,543 - 39,260 16,754

7,433 - 39,426 11,189

18,494 -

$ 180,447 39,866 -

71,336 30,173 30,173

- 2,501 2,501

39,510

96,636 214,832 116,302 116,302

10,740

23,810

• $ 148,439

  $ 148,439

• 62,493 21,646 21,646

  $ $

  217,604

  • $ 220,614

    • $ 231,011

      • $ 340,759 $1,009,988

        87,870

  • $ 78,850

    • $ 77,635

      • $ 69,487 $ 313,842

      33,990

  • 47,213

    • 49,293

      70,508

• $ 319,061

  • $ 319,061

• $ 52,102

• $ 52,102

201,004 82,439 82,439

30,473

• 27,120

  • 29,170

    7,623

    94,386 20,722 20,722

    3,714

• 9,383

  • 6,169

    32,829

  • 52,095 (6,824) (6,824)

    5,543 -

• 7,433 -

  • 18,494 -

    39,866 -

    71,336 30,173 30,173

    - 2,501 2,501

    39,260

• 39,426

  • 39,510

    96,636 214,832 116,302 116,302

    16,754

• 11,189

  • 10,740

  • 38,175

    23,810 57,169

    62,493 21,646 21,646

• 38,211

• 38,246

171,801 65,257 65,257

$ 255,779

$ 258,825

$ 269,257

$ 397,928

$1,181,789

$ 384,318

$ 384,318

Operating margin Non-GAAP operating margin Adjusted EBITDA margin

9.5 % 13.3 % 15.6 %

10.1 % 13.7 % 16.0 %

9.9 % 14.1 % 16.5 %

8.1 % 15.3 % 17.8 %

9.3 % 14.2 % 16.6 %

6.2 % 13.3 % 16.0 %

6.2 % 13.3 % 16.0 %

Non-GAAP Financial information * Net income

Acquisition-related and integration expenses Step-up depreciation

Acquisition-related expenses included in interest expense and finance charges, net**

Acquisition-related expenses included in other expense (income), net**

Imputed interest related to sellers' note included in interest expense and finance charges, net

Change in acquisition contingent consideration included in other income

Foreign currency losses (gains), net **** Amortization of intangibles Share-based compensation

Income taxes related to the above*** Non-GAAP net income

Net income

Less: net income allocated to participating securities Net income attributable to common stockholders

Acquisition-related and integration expenses allocated to common stockholders

Step-up depreciation allocated to common stockholders Acquisition-related expenses included in interest expense and finance charges, net allocated to common stockholders** Acquisition-related expenses included in other expense (income), net allocated to common stockholders**

Imputed interest related to sellers' note included in interest expense and finance charges, net allocated to common stockholders Change in acquisition contingent consideration included in other income allocated to common stockholders

Foreign currency losses (gains), net allocated to common stockholders ****

Amortization of intangibles allocated to common stockholders Share-based compensation allocated to common stockholders Income taxes related to the above allocated to common stockholders***

Non-GAAP net income attributable to common stockholdersNon-GAAP diluted earnings per common share

Q1

$

• 87,870 $ 5,543 - - - - -

Q2

• 78,850 $ 7,433 - 11,840 12,429

Q3

• 77,635 $ 18,494 - 13,716 2,064

Q4

2,502

(3,954)

-

-

3,557

-

-

• 69,487 $ 39,866 - - 136 2,998 15,681 12,833

YTD 2023 313,842

71,336 30,173 30,173

- 2,501 2,501

25,556 14,629 2,998

15,681 (14,897)

14,938

39,260

39,426

39,510

Q1

Q2

Q3

Q4

YTD 2024

• $ 52,102

  $ 52,102

• - - 4,178

  - - 4,178

  (14,897)

  6,610

  6,610

  96,636 214,832 116,302 116,302

  16,754

  11,189

  10,740

  23,810 (47,990)

  62,493 21,646 21,646

  (16,015)

  (19,591)

  (22,020)

  (105,616)

  $ $

  135,914

  • $ 137,622

    • $ 143,696

      • $ 213,457

        • $ 630,689

        • $ 313,842

        • (42,960)

          (42,960)

• $ 175,655

  87,870 (1,546) 86,324 5,445 - - - - - 2,458 38,569 16,459

  • $ 78,850 (1,357) 77,493

    • $ 77,635 (1,282) 76,353

      • $ 69,487 (1,659) 67,828

        • (5,978)

        307,864 50,104 50,104

  • 7,305

  • 18,189

  • 38,914

  69,977 29,016 29,016

  - 11,636 12,215

  - 13,490 2,030

  - - 133 2,926 15,307 12,527

  - 2,405 2,405

  - -

  - - 3,498 38,858 10,563

  25,069 14,350 2,941

  15,382 (14,326)

  (3,886) 38,747 10,996

  14,653

  94,329 210,740 111,842 111,842

  23,242

  61,303 20,816 20,816

  (15,733)

  (19,254)

  (21,656)

  (46,844)

  (103,604)

  $ 133,522 $ 2.59

  $ 135,252 $ 2.63

  $ 141,325 $ 2.76

  $ 208,362 $ 3.36

  $ 618,675 $ 11.45

• $ 52,102 (1,998)

• $ 175,655

• $ 52,102 (1,998)

- - 4,018

- - 4,018

(14,326)

6,357

6,357

(41,313)

(41,313)

• $ 168,919

• $ 2.57

$ 168,919 $ 2.57

Cash Flow Data	Q1 Q2 Q3 Q4 YTD 2023	Q1 Q2 Q3 Q4 YTD 2024
Net cash provided by (used in) operating activities $ 103,893 $ 133,435 $ 211,416 $ 229,264 $ 678,008 $ (46,870) $ (46,870)
Purchases of property and equipment (39,597) (32,184) (43,936) (64,815) (180,532) (56,059) (56,059)
Free cash flow (a non-GAAP measure) $ 64,296 $ 101,251 $ 167,480 $ 164,449 $ 497,476 (102,929) (102,929)
Change in outstanding factoring balances 21,624 21,624
Adjusted free cash flow (a non-GAAP measure) $ (81,305) $ (81,305)

Unaudited 2023

Unaudited 2024

Balance sheet data

SELECTED CONSOLIDATED BALANCE SHEET DATA Cash and cash equivalents

Goodwill 5,030,656

$ 178,386 $ 152,896 $2,112,792 $ 295,336
754,171 744,573 2,656,393 784,610
6,623,070 6,560,005 8,449,542 12,491,827
- - - 2,313
$2,800,501 $2,854,262 $2,903,522 $4,143,294
Audited
$ 178,386 $ 152,896 $2,112,792 $ 295,336
1,381,610 1,394,012 1,379,437 1,888,890
188,141 205,149 209,736 674,423
1,748,137 1,752,057 3,701,965 2,858,649
399,132 394,464 406,297 748,691
2,905,078 2,903,594 2,897,048 5,078,668
948,904 910,784 873,091 2,804,965
44,934 44,892 48,109 72,333
576,885 554,214 523,032 928,521
$6,623,070 $6,560,005 $8,449,542 $12,491,827

Working capital

Total assets Borrowings, current Total equity

CONSOLIDATED BALANCE SHEET ASSETS

Current assets:

Cash and cash equivalents Accounts receivable, net Other current assets Total current assets Property and equipment, net

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

$ 234,794

999,155

12,242,859

2,714

$4,101,637

$ 234,794

1,927,644

619,483

2,781,921

730,242

Intangible assets, net 2,672,636

Deferred tax assets 76,088

Other assets 951,316

Total assets

$12,242,859

Unaudited 2023

Audited

Unaudited 2024

LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities:

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Accounts payable

$ 243,565

$ 202,362

388,786

418,221

731,172 594,341

Current portion of long-term debt Accrued compensation and benefits Other accrued liabilities

$ 141,666 -

$ 148,679 -

$ 137,524 - 470,351

2,313 2,714

392,722

399,539

398,314 1,016,406 923,744

70,792

41,045

39,383 80,583 59,605

2,220,207

2,130,960 3,973,467 4,939,712 5,034,109

99,626

77,179 58,820 414,246 385,912

Income taxes payable Total current liabilities Long-term debt, net Other long-term liabilities Deferred tax liabilities

Total liabilities

993,966

1,007,484 1,045,572 2,074,039 1,782,766

508,770

490,120 468,161 920,536 938,435

3,822,569

3,705,743

5,546,020

8,348,533

8,141,222

2,447,418

2,459,234

2,471,939

3,582,521

3,605,694

847,671

912,204

975,591

1,024,461

1,055,950

Stockholders' equity: Preferred stock Common stock Additional paid-in capital Treasury stock Retained earnings

Accumulated other comprehensive loss

-

-

-

-

5

5

5

7

(208,996)

(214,172)

(241,852)

(271,968)

(285,597)

(303,009)

(302,161)

(191,727)

-

7

(295,732)

(264,282)

Total stockholders' equity

2,800,501

2,854,262

2,903,522

4,143,294

4,101,637

Total liabilities and stockholders' equity

$6,623,070

$6,560,005

$8,449,542

$12,491,827

$12,242,859

* Non-GAAP Financial Measures

In addition to disclosing financial results that are determined in accordance with GAAP, we also disclose certain non-GAAP financial information, including:

• • Non-GAAP operating income, which is operating income, adjusted to exclude acquisition-related and integration expenses, including related restructuring costs, step-up depreciation, amortization of intangible assets and share-based compensation.

• • Non-GAAP operating margin, which is non-GAAP operating income, as defined above, divided by revenue.

• • Adjusted earnings before interest, taxes, depreciation, and amortization, or adjusted EBITDA, which is non-GAAP operating income, as defined above, plus depreciation (exclusive of step-up depreciation).

• • Adjusted EBITDA margin, which is adjusted EBITDA, as defined above, divided by revenue.

• • Non-GAAP net income, which is net income excluding the tax effected impact of acquisition-related and integration expenses, including related restructuring costs, amortization of intangible assets, share-based compensation, imputed interest related to the Sellers' note, change in acquisition contingent consideration and foreign currency losses (gains), net.

• • Free cash flow, which is cash flows from operating activities less capital expenditures, and adjusted free cash flow, which is free cash flow excluding the effect of changes in the outstanding factoring balance. We believe that free cash flow is a meaningful measure of cash flows since capital expenditures are a necessary component of ongoing operations. We believe that adjusted free cash flow is a meaningful measure of cash flows because it removes the effect of factoring which changes the timing of the receipt of cash for certain receivables. However, free cash flow and adjusted free cash flow have limitations because they do not represent the residual cash flow available for discretionary expenditures. For example, free cash flow and adjusted free cash flow do not incorporate payments for business acquisitions.

• • Non-GAAP diluted earnings per common share ("EPS"), which is diluted EPS excluding the per share, tax effected impact of acquisition-related and integration expenses, including related restructuring costs, step-up depreciation, amortization of intangible assets, share-based compensation, imputed interest related to the Sellers' note, change in acquisition contingent consideration and foreign currency losses (gains), net. Non-GAAP EPS excludes net income attributable to participating securities, and the per share, tax-effected impact of adjustments to net income described above reflect only those amounts that are attributable to common shareholders.

• • Constant currency revenue growth, which is revenue growth adjusted for the translation effect of foreign currencies so that certain financial results can be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our business performance. Constant currency revenue growth is calculated by translating the revenue of each fiscal year in the billing currency to U.S. dollars using the comparable prior year's currency conversion rate in comparison to prior year's revenue. Generally, when the U.S. dollar either strengthens or weakens against other currencies, revenue growth at constant currency rates or adjusting for currency will be higher or lower than revenue growth reported at actual exchange rates.

• • Pro forma constant currency revenue growth, which is constant currency revenue growth measured against the Company's combined pro forma results of operations as if the combination with Webhelp had occurred on December 1, 2022.

We believe that providing this additional information is useful to the reader to better assess and understand our base operating performance, especially when comparing results with previous periods and for planning and forecasting in future periods, primarily because management typically monitors the business adjusted for these items in addition to GAAP results. Management also uses these non-GAAP measures to establish operational goals and, in some cases, for measuring performance for compensation purposes. These non-GAAP financial measures exclude amortization of intangible assets. Our acquisition activities have resulted in the recognition of intangible assets, which consist primarily of customer relationships, technology, and trade names. Finite-lived intangible assets are amortized over their estimated useful lives and are tested for impairment when events indicate that the carrying value may not be recoverable. The amortization of intangible assets is reflected in our statements of operations. Although intangible assets contribute to our revenue generation, the amortization of intangible assets does not directly relate to the services performed for our clients. Additionally, intangible asset amortization expense typically fluctuates based on the size and timing of our acquisition activity. Accordingly, we believe excluding the amortization of intangible assets, along with the other non-GAAP adjustments, which neither relate to the ordinary course of our business nor reflect our underlying business performance, enhances our and our investors' ability to compare our past financial performance with its current performance and to analyze underlying business performance and trends. Intangible asset amortization excluded from the related non-GAAP financial measure represents the entire amount recorded within our GAAP financial statements, and the revenue generated by the associated intangible assets has not been excluded from the related non-GAAP financial measure. Intangible asset amortization is excluded from the related non-GAAP financial measure because the amortization, unlike the related revenue, is not affected by operations of any particular period unless an intangible asset becomes impaired or the estimated useful life of an intangible asset is revised. These non-GAAP financial measures also exclude share-based compensation expense. Given the subjective assumptions and the variety of award types that companies can use when calculating share-based compensation expense, management believes this additional information allows investors to make additional comparisons between our operating results and those of our peers. As these non-GAAP financial measures are not calculated in accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures and should be used as a complement to, and in conjunction with, data presented in accordance with GAAP.

** Included in these amounts are a) expensed Bridge Facility financing fees and interest expense associated with our senior notes, net of interest earned on the invested senior notes proceeds incurred in advance of the combination with Webhelp and b) expenses associated with non-designated call option contracts put in place to hedge foreign exchange movements in connection with the combination with Webhelp that are included within interest expense and finance charges, net and other expense (income), net, respectively, in the consolidated statement of operations.

*** The tax effect of taxable and deductible non-GAAP adjustments was calculated using the tax deductible portion of the expenses and applying the entity-specific, statutory tax rates applicable to each item during the respective fiscal years.

**** Foreign currency losses (gains), net are included in other expense (income), net and primarily consist of gains and losses recognized on the revaluation and settlement of foreign currency transactions and realized and unrealized gains and losses on derivative contracts that do not qualify for hedge accounting. The reported amounts for non-GAAP net income and non-GAAP EPS for all periods presented include adjustments to exclude these foreign currency losses (gains), net.