- First quarter total revenues of
$239.7 million , representing 56.8% of year-over-year growth. All growth was entirely organic. - GAAP net income margin of 4.8%, including non-cash stock-based compensation expense of
$19 .6 million. - Adjusted EBITDA margin of 22.6%, non-GAAP adjusted net income margin of 14.6%.
- Full year 2022 outlook for revenues between $980 million and
$1 ,000 million, representing growth of approximately 30.0% at the midpoint, and Adjusted EBITDA margin of approximately 23%.
“In the first quarter, we saw year-over-year organic revenue growth of over 56.8% and our reputation as an employer of choice has allowed us to continue to attract talent to
First Quarter 2022 Financial and Frontline Highlights
($ thousands, except per share amounts) | Three months ended | |||||||||
2022 | 2021 | % Change | ||||||||
Service revenue | $ | 239,680 | $ | 152,871 | 56.8 | % | ||||
GAAP net income | $ | 11,586 | $ | 16,507 | (29.8) | % | ||||
GAAP net income margin | 4.8 | % | 10.8 | % | ||||||
Adjusted EBITDA | $ | 54,131 | $ | 39,541 | 36.9 | % | ||||
Adjusted EBITDA margin | 22.6 | % | 25.9 | % | ||||||
Non-GAAP Adjusted Net Income | $ | 34,965 | $ | 28,198 | 24.0 | % | ||||
Non-GAAP Adjusted Net Income margin | 14.6 | % | 18.4 | % | ||||||
GAAP diluted earnings per share | $ | 0.11 | $ | 0.18 | (38.9) | % | ||||
Non-GAAP Adjusted EPS | $ | 0.34 | $ | 0.31 | 9.7 | % |
- Ended the quarter with 45,800 teammates (approximately 80% working from home), an increase of approximately 5,700 from
December 31, 2021 . - Progress on geographic expansion in
Japan ,Malaysia ,Europe ,India andPhilippines - TaskUs Glassdoor score as of
March 31, 2022 was 4.6.
Second Quarter and Full Year 2022 Outlook
For the second quarter and full year 2022,
2022 Outlook | |||||
Second Quarter | Full Year | ||||
Revenue (in millions) | $980 to $1,000 | ||||
Revenue growth (YoY) at midpoint | 35% | 30% | |||
Adjusted EBITDA Margin | 22.5% | 23% |
- With respect to the non-GAAP Adjusted EBITDA margin outlook provided above, a reconciliation to the closest GAAP financial measure has not been provided as the quantification of certain items included in the calculation of GAAP net income (loss) cannot be calculated or predicted at this time without unreasonable efforts. For example, the non-GAAP adjustment for stock-based compensation expense requires additional inputs such as number of shares granted and market price that are not currently ascertainable, the non-GAAP adjustment for foreign currency gains or losses depends on the timing and magnitude of changes in foreign currency exchange rates and cannot be accurately forecasted. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could have a potentially unpredictable, and potentially significant, impact on its future GAAP financial results.
Conference Call Information
About
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts, and further include, without limitation, statements reflecting our current views with respect to, among other things, our operations, our financial performance, our industry, the impact of the COVID-19 global pandemic on our business, and other non-historical statements including the statements in the “Second Quarter and Full Year 2022 Outlook” section of this press release. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “predicts,” “intends,” “trends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors include but are not limited to: the dependence of our business on key clients; the risk of loss of business or non-payment from significant clients; our failure to cost-effectively acquire new, high-growth clients; the risk that we may provide inadequate service or cause disruptions in our clients’ businesses or fail to comply with the quality standards required by our clients under our agreements; unauthorized or improper disclosure of personal or other sensitive information, or security breaches and incidents; negative publicity or liability or difficulty retaining and recruiting employees; our failure to detect and deter criminal or fraudulent activities or other misconduct by our employees; global economic and political conditions, especially in the social media and meal delivery and transport industries from which we generate most of our revenue; the dependence of our business on our international operations, particularly in
Non-GAAP Measures
Investor Contact
IR@TaskUs.com
Media Contact
(212) 355-4449
Condensed Consolidated Statements of Operations (unaudited)
(in thousands, except per share data)
Three months ended | ||||||
2022 | 2021 | |||||
Service revenue | $ | 239,680 | $ | 152,871 | ||
Operating expenses: | ||||||
Cost of services | 141,282 | 88,030 | ||||
Selling, general, and administrative expense | 64,247 | 31,498 | ||||
Depreciation | 8,901 | 6,203 | ||||
Amortization of intangible assets | 4,711 | 4,712 | ||||
Loss (gain) on disposal of assets | (15 | ) | 27 | |||
Total operating expenses | 219,126 | 130,470 | ||||
Operating income | 20,554 | 22,401 | ||||
Other expense | 1,053 | 754 | ||||
Financing expenses | 1,602 | 1,581 | ||||
Income before income taxes | 17,899 | 20,066 | ||||
Provision for income taxes | 6,313 | 3,559 | ||||
Net income | $ | 11,586 | $ | 16,507 | ||
Net income per common share: | ||||||
Basic | $ | 0.12 | $ | 0.18 | ||
Diluted | $ | 0.11 | $ | 0.18 | ||
Weighted-average number of common shares outstanding: | ||||||
Basic | 97,481,412 | 91,737,020 | ||||
Diluted | 104,122,026 | 91,737,020 |
Condensed Consolidated Balance Sheets (unaudited)
(in thousands)
2022 | 2021 | ||||
Assets | |||||
Current assets: | |||||
Cash | $ | 77,074 | $ | 63,584 | |
Accounts receivable, net of allowance for doubtful accounts of | 172,391 | 162,895 | |||
Other receivables | 669 | 597 | |||
Prepaid expenses | 12,498 | 10,939 | |||
Income tax receivable | 160 | 3,863 | |||
Other current assets | 5,218 | 4,428 | |||
Total current assets | 268,010 | 246,306 | |||
Noncurrent assets: | |||||
Property and equipment, net | 87,639 | 80,046 | |||
Deferred tax assets | 1,442 | 1,441 | |||
Intangibles | 216,737 | 221,448 | |||
195,735 | 195,735 | ||||
Other noncurrent assets | 5,202 | 5,022 | |||
Total noncurrent assets | 506,755 | 503,692 | |||
Total assets | $ | 774,765 | $ | 749,998 | |
Liabilities and Shareholders’ Equity | |||||
Liabilities: | |||||
Current liabilities: | |||||
Accounts payable and accrued liabilities | $ | 39,774 | $ | 40,890 | |
Accrued payroll and employee-related liabilities | 34,716 | 36,670 | |||
Current portion of debt | 52,447 | 51,135 | |||
Current portion of income tax payable | 3,348 | 2,416 | |||
Deferred revenue | 4,873 | 4,095 | |||
Deferred rent | 481 | 735 | |||
Total current liabilities | 135,639 | 135,941 | |||
Noncurrent liabilities: | |||||
Income tax payable | 2,886 | 2,886 | |||
Long-term debt | 183,441 | 187,240 | |||
Deferred rent | 3,386 | 2,749 | |||
Accrued payroll and employee-related liabilities | 2,078 | 1,813 | |||
Deferred tax liabilities | 40,235 | 40,235 | |||
Total noncurrent liabilities | 232,026 | 234,923 | |||
Total liabilities | 367,665 | 370,864 | |||
Total shareholders’ equity | 407,100 | 379,134 | |||
Total liabilities and shareholders’ equity | $ | 774,765 | $ | 749,998 |
Condensed Consolidated Statement of Cash Flows (unaudited)
(in thousands)
Three months ended | |||||||
2022 | 2021 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 11,586 | $ | 16,507 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation | 8,901 | 6,203 | |||||
Amortization of intangibles | 4,711 | 4,712 | |||||
Amortization of debt financing fees | 139 | 114 | |||||
Loss (gain) on disposal of assets | (15 | ) | 27 | ||||
Provision for losses on accounts receivable | 479 | 231 | |||||
Unrealized foreign exchange losses on forward contracts | 759 | 1,820 | |||||
Deferred taxes | (19 | ) | — | ||||
Stock-based compensation expense | 19,605 | — | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (9,979 | ) | (6,106 | ) | |||
Other receivables, prepaid expenses, and other current assets | (2,478 | ) | 1,558 | ||||
Other noncurrent assets | (223 | ) | (297 | ) | |||
Accounts payable and accrued liabilities | (1,071 | ) | 471 | ||||
Accrued payroll and employee-related liabilities | (1,392 | ) | 8,755 | ||||
Income tax payable | 4,686 | 5,037 | |||||
Deferred revenue | 779 | 666 | |||||
Deferred rent | 422 | 224 | |||||
Net cash provided by operating activities | 36,890 | 39,922 | |||||
Cash flows from investing activities: | |||||||
Purchase of property and equipment | (17,770 | ) | (10,127 | ) | |||
Net cash used in investing activities | (17,770 | ) | (10,127 | ) | |||
Cash flows from financing activities: | |||||||
Payments on long-term debt | (2,625 | ) | (1,313 | ) | |||
Payments for taxes related to net share settlement | (1,469 | ) | — | ||||
Net cash used in financing activities | (4,094 | ) | (1,313 | ) | |||
Increase in cash and cash equivalents | 15,026 | 28,482 | |||||
Effect of exchange rate changes on cash | (1,536 | ) | (717 | ) | |||
Cash and cash equivalents at beginning of period | 63,584 | 107,728 | |||||
Cash and cash equivalents at end of period | $ | 77,074 | $ | 135,493 |
Non-GAAP Reconciliations
Adjusted EBITDA (unaudited)
(in thousands, except margin amounts)
Three months ended | |||||||
2022 | 2021 | ||||||
Net income | $ | 11,586 | $ | 16,507 | |||
Provision for income taxes | 6,313 | 3,559 | |||||
Financing expenses | 1,602 | 1,581 | |||||
Depreciation | 8,901 | 6,203 | |||||
Amortization of intangible assets | 4,711 | 4,712 | |||||
EBITDA | $ | 33,113 | $ | 32,562 | |||
Transaction costs(1) | 192 | 3,329 | |||||
Foreign currency losses(2) | 1,153 | 787 | |||||
Loss (gain) on disposal of assets | (15 | ) | 27 | ||||
COVID-19 related expenses(3) | — | 2,394 | |||||
Natural disaster(4) | — | 442 | |||||
Stock-based compensation expense(5) | 19,688 | — | |||||
Adjusted EBITDA | $ | 54,131 | $ | 39,541 | |||
Net Income Margin(6) | 4.8 | % | 10.8 | % | |||
Adjusted EBITDA Margin(6) | 22.6 | % | 25.9 | % |
(1 | ) | Represents non-recurring professional service fees related to the acquisition of heloo in 2022 and the preparation for public offerings that have been expensed during the period in 2021. |
(2 | ) | Realized and unrealized foreign currency losses include the effect of fair market value changes of forward contracts and remeasurement of |
(3 | ) | Represents incremental expenses incurred related to the transition to a virtual operating model and incentive and leave pay granted to employees that are directly attributable to the COVID-19 pandemic. |
(4 | ) | Represents one-time costs associated with emergency housing, transportation costs and bonuses for our employees in connection with the natural disaster related to the severe winter storm in |
(5 | ) | Represents stock-based compensation expense and employer payroll tax associated with equity-classified awards. |
(6 | ) | Net Income Margin represents net income divided by service revenue and Adjusted Net Income Margin represents Adjusted Net Income divided by service revenue. |
Non-GAAP Reconciliations
Adjusted Net Income (unaudited)
(in thousands, except margin amounts)
Three months ended | |||||||
2022 | 2021 | ||||||
Net income | $ | 11,586 | $ | 16,507 | |||
Amortization of intangible assets | 4,711 | 4,712 | |||||
Transaction costs(1) | 192 | 3,329 | |||||
Foreign currency losses(2) | 1,153 | 787 | |||||
Loss (gain) on disposal of assets | (15 | ) | 27 | ||||
COVID-19 related expenses(3) | — | 2,394 | |||||
Natural disaster costs(4) | — | 442 | |||||
Stock-based compensation expense(5) | 19,688 | — | |||||
Tax impacts of adjustments(6) | (2,350 | ) | — | ||||
Adjusted Net Income | $ | 34,965 | $ | 28,198 | |||
Net Income Margin(7) | 4.8 | % | 10.8 | % | |||
Adjusted Net Income Margin(7) | 14.6 | % | 18.4 | % |
(1 | ) | Represents non-recurring professional service fees related to the acquisition of heloo in 2022 and the preparation for public offerings that have been expensed during the period in 2021. |
(2 | ) | Realized and unrealized foreign currency losses include the effect of fair market value changes of forward contracts and remeasurement of |
(3 | ) | Represents incremental expenses incurred related to the transition to a virtual operating model and incentive and leave pay granted to employees that are directly attributable to the COVID-19 pandemic. |
(4 | ) | Represents one-time costs associated with emergency housing, transportation costs and bonuses for our employees in connection with the natural disaster related to the severe winter storm in |
(5 | ) | Represents stock-based compensation expense and employer payroll tax associated with equity-classified awards. |
(6 | ) | Represents tax impacts of adjustments to net income which resulted in a tax benefit during the period, including stock-based compensation expense after the IPO. |
(7 | ) | Net Income Margin represents net income divided by service revenue and Adjusted Net Income Margin represents Adjusted Net Income divided by service revenue. |
Non-GAAP Reconciliations
Adjusted EPS (unaudited)
Three months ended | |||||
2022 | 2021 | ||||
GAAP diluted EPS | $ | 0.11 | $ | 0.18 | |
Per share adjustments to net income(1) | 0.23 | 0.13 | |||
Adjusted EPS | $ | 0.34 | $ | 0.31 | |
Weighted-average common shares outstanding – diluted | 104,122,026 | 91,737,020 |
(1 | ) | Reflects the aggregate adjustments made to reconcile net income to Adjusted Net Income, as noted in the above table, divided by the GAAP diluted weighted-average number of shares outstanding for the relevant period. |
Definitions of Non-GAAP Metrics
EBITDA and Adjusted EBITDA
EBITDA is a non-GAAP profitability measure that represents net income or loss for the period before the impact of the benefit from or provision for income taxes, financing expenses, depreciation, and amortization of intangible assets. EBITDA eliminates potential differences in performance caused by variations in capital structures (affecting financing expenses), tax positions (such as the availability of net operating losses against which to relieve taxable profits), the cost and age of tangible assets (affecting relative depreciation expense) and the extent to which intangible assets are identifiable (affecting relative amortization expense).
Adjusted EBITDA is a non-GAAP profitability measure that represents EBITDA before certain items that are considered to hinder comparison of the performance of our businesses on a period-over-period basis or with other businesses. During the periods presented, we exclude from Adjusted EBITDA transaction costs, the effect of foreign currency gains and losses, losses on disposals of assets, COVID-19 related expenses, natural disaster costs and stock-based compensation expense and employer payroll tax associated with equity-classified awards, which include costs that are required to be expensed in accordance with GAAP. Our management believes that the inclusion of supplementary adjustments to EBITDA applied in presenting Adjusted EBITDA are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future.
Adjusted EBITDA Margin represents Adjusted EBITDA divided by service revenue.
Adjusted Net Income
Adjusted Net Income is a non-GAAP profitability measure that represents net income or loss for the period before the impact of amortization of intangible assets and certain items that are considered to hinder comparison of the performance of our businesses on a period-over-period basis or with other businesses. During the periods presented, we exclude from Adjusted Net Income amortization of intangible assets, transaction costs, the effect of foreign currency gains and losses, losses on disposals of assets, COVID-19 related expenses, natural disaster costs, stock-based compensation expense and employer payroll tax associated with equity-classified awards and the related effect on income taxes of certain pre-tax adjustments, which include costs that are required to be expensed in accordance with GAAP. Our management believes that the inclusion of supplementary adjustments to net income applied in presenting Adjusted Net Income are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future.
Adjusted Net Income Margin represents Adjusted Net Income divided by service revenue.
Adjusted EPS
Adjusted EPS is a non-GAAP profitability measure that represents earnings available to shareholders excluding the impact of certain items that are considered to hinder comparison of the performance of our business on a period-over-period basis or with other businesses. Adjusted EPS is calculated as Adjusted Net Income divided by our diluted weighted-average number of shares outstanding, including the impact of any potentially dilutive common stock equivalents that are anti-dilutive to GAAP net income (loss) per share – diluted (“GAAP diluted EPS”) but dilutive to Adjusted EPS. Our management believes that the inclusion of supplementary adjustments to earnings per share applied in presenting Adjusted EPS are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future.
Source:
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