Q2 2021 Taskus Inc Earnings Call
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Good afternoon, and welcome to the task of the second quarter 2021, Investor call. My name is Josh and I will be your conference facilitator today at this time all lines have been placed on mute to avoid the background noise and after the Speakers' remarks, there will be a question and answer period. That's the question. During the session you will need to press the star.
And 1 on your telephone if you require any further assistance. Please press star zero and I would now like to introduce Barry Hutton.
Managing director of Investor Relations, Barry you may begin.
Good afternoon, and thank you for joining us for the task of second quarter of 2021 earnings call. Joining me on the call today are Brian <unk> co founder and Chief Executive Officer of task and <unk> day car.
<unk> financial officer full details of our results and additional management commentary are available and our earnings release, which can be found on the Investor Relations section of the website at IR Dot task of Dot Com. Please note that this call will be simultaneously webcast on the Investor Relations section of the company's core.
<unk> web site.
Before we start I would like to remind you that the following discussion contains forward looking statements within the meaning of the federal securities laws, including but not limited to statements regarding task of future financial results and management's expectations and plans for the business.
These statements are neither promises nor guarantees and involve risks and uncertainties that may cause the actual results to differ materially from those discussed here.
Should not place undue reliance on any forward looking statements.
Actors that could cause actual results to differ from the forward looking statements can be found in our prospectus dated June 10, 2021 filed with the SEC on June 14, 2021, which of the festival on the SEC's website at Www Dot FCC Dot Gov and also.
The available on our website at IR Dot task of Dot com.
As may be supplemented in subsequent periodic reports, we file with the SEC.
Any forward looking statements made in this conference call, including responses to your questions are based on current expectations as of today and task of assumes no obligation to update or revise them, whether as a result of new developments or otherwise except as required by law the.
The following discussion contains non-GAAP financial measures.
For a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP metric. Please see our earnings press release, which is available in the IR section on our website at IR Dot task on Dot com.
Now I will turn the call over to price co founder and Chief Executive officer of cash cows.
Thank you Mary good afternoon, everyone and thank you for joining us it's a bit surreal to welcome you all to our first ever quarterly investor call as a public company.
Before we begin I want us to take the moment to thank our teammates around the globe, who continue to show up in the day and night to deliver for our clients today would not be possible without each of you.
I also want to thank our clients partners and new investors for joining us on this journey and helping us the complete very successful IPO in June.
All of this has taken place against the background of and ongoing global pandemic.
Ask us the health and safety of our teammates and the communities we serve remain our top priority.
<unk> is committed to paying for the vaccination of every task of teammates and their family members I'm proud to report that in Q2, we began facilitating vaccinations for our teammates of India, and we expect to do the same and the Philippines and the third quarter.
As of June 32021, approximately 91% of task of teammates around the globe, we're working from home.
My deepest sympathies go out to our teammates and their families who have been affected by this pandemic.
Spite, the losses and tragedies many of our teammates of endured they've delivered a remarkable performance and our first ever public quarter.
In Q2, our team delivered strong growth and profitability. Our second quarter revenue grew 57, 4% year on year to $180 million. It's important to note that this growth is completely organic just like all of our growth to date.
Our second quarter adjusted EBITDA for <unk>.
67, 3% year on year to $44.1 million on adjusted EBITDA margin of 24.5 per cent.
Since this is our first call together and we've got many listeners. We're just getting to know task us I'm going to provide a brief overview of our business before going a bit deeper into our Q2 results.
Task. This was founded in 2008 that Youre My best friend, Jasper, where and I had just graduated from college and took the middle of the worst recession in recent memory.
Struggling to find jobs, and we decided to invest our combined life savings to launch task for us.
While all of the major competitors and our industry were occupied serving traditional telco clients. We made the decision to focus 100% of our efforts on the emerging digital economy.
Most of those clients of 3 things and comments they are truly customer obsessed they've grown faster than nearly every other company and history and their success has led to massive operational challenges they can put their customer experience at risk.
That's where we come in.
<unk> provides the specialized services these companies rely on the steal their business and deliver for their customers.
The date, we provide 3 primary specialized services digital customer experience content security and artificial intelligence operations.
We've been fortunate enough to be the chose and outsourcing partner of many of the companies that have defined this era of digital innovation.
Which has enabled us to grow revenue organically at a 60% CAGR from 2017 of 2020 and achieve and average net revenue retention rate of 125% from 2018 to 2020.
The market opportunity in front of US is simply massive the total addressable market across the specialized services, we deliver is over $100 billion.
And demand for some of these services is growing up to 50% annually.
So we are just getting started we have 5 areas of focus that enable us to drive consistent above market growth and profitability the <unk>.
First is our current clients, who are growing extremely fast and accelerating their outsourcing spend.
The second is introducing new specialized service offerings the <unk>.
Third is expanding our global delivery footprint the.
The fourth is adding new clients.
Our current success with high growth Disruptors, we're focused on big Tech and supporting the digital transformation of Fortune 500 companies the.
The final area of focus will be M&A, while we've grown 100% organically to date, we're exploring acquisitions that will expand our geographic and service capabilities.
So with that as background, let me share a few more details on our performance in the first half of 2021 and Q2 more specifically.
And the first half of the year, we closed a record amount of business for both new and existing clients, we saw significant new client wins and existing client expansions and our Fintech business, which includes digital banking clients online exchanges and crypto currency providers.
Our E Commerce segment had a very strong start for the year signing for exciting new clients, we're seeing significant growth due to changes and online buying behavior driven by the pandemic.
We signed a major online gaming company, 1 of the hottest mobile dating apps and the world and of European Health Tech provider, all of which are new clients to task for us.
Finally, 1 of our most exciting new contracts can be autonomous vehicle space, where our AI operations team is helping to enable the future of self driving cars.
And the second quarter, we saw strong revenue growth across all of the specialized services. We deliver for customers. We also saw strong revenue growth in each of the 8 countries from which we deliver these services.
For our 2 largest verticals by revenue social media and on demand and transportation and food delivery. We saw continued double digit year on year growth.
Our social media revenue growth was primarily driven by geographic expansions and service line additions within existing clients.
Our on demand and transportation and food delivery revenue grew significantly even when compare to an unbelievably strong Q2, 2020, and which we saw a surge of pandemic related demand from customers and the food delivery space.
We continue to see very rapid growth driven by our investment and strategic vertical markets.
Notably, our Fintech business delivered over $10 million and sequential quarter over quarter growth and grew and astounding, 300% year over year and.
And the Fintech, we see strong demand for our specialized services and the areas of anti money laundering and know your customer.
Our health Tech and high Tech businesses grew revenues in the high double digits, and our retail and E. Commerce vertical delivered triple digit revenue growth fueled by a strong online shopping environment and new client wins.
In Q2, we saw continued revenue growth from our top 2 clients while revenue concentration from our largest client continued to improve and the quarter, our largest client which represented 32% of our 2020 revenues and 29% of our Q1.2021 revenues delivered 27% of our Q2 revenues.
I'm extremely proud of what our team has delivered this quarter and this year on.
All of this is made possible by our ridiculous leak good people.
Now I know that every company talks about their culture, but it task of culture is a core part of our competitive strategy because of attracting and retaining world class talent is what enables us to deliver specialized services at scale.
This has never been more important than it is today and the.
Face of increasing competition for talent, we are confident because of the investments we've made and our people since day 1.
In Q2, we continue these investments.
We ensured that every task as teammate benefited from our IPO paying of cash bonus or equity award to every 1 of our employees.
We paid for the private education of 755 of our teammates children through the task of scholars program and.
And we held over 3000 connects 15 sessions. These are 1 to 1 of the video conference calls between our senior leaders and frontline teammates. This platform, which was built by task is to replicate the serendipitous meetings, we used to have and office randomly pairs to people for a 15 minute conversation about anything.
This quarter I got to meet the technical writer working on site for a big Tech client of ours and debate area of member of our software development team in India and of teammates supporting of video conferencing client from the Philippines.
So while the competition for talent has never been more intense we are continuing to scale successfully.
And Q2, we added over 4000, new task of teammates and delivered and on time hiring SLA of over 98%.
Our Glassdoor rating was 4.7 stars as of June 30th.
And while we have seen a slight increase and attrition from 2020. This year's numbers remained well below those of 2019.
Our team's success signing of the scaling new business and the first half of the year puts us and a great position to provide our first ever revenue and EBITDA guidance and for that I'll hand, it over to biology.
Thanks, Mike and good afternoon, everyone.
And I'm going to discuss the financial results for the second quarter of 2020.1.
Please note that some of these items of non-GAAP measures and the the limit the reconciliation attached to the press release, we issued earlier today.
In the second quarter, we earned total revenues of 180.0 millions of dollars.
And increase of 57 for bus and video over the prior year.
But I just outlined.
Generally the revenue from 3 specialized service offerings.
And of the second quarter of the digital customer experience business generated $113.6 million for year over year growth rate of $59.2 Portland Beach.
Our content security business grew but the.
The 8.4% page to deliver 43.0 million.
And over the Air operations business grew 95, 9 percentage for revenues of $23.5 million.
Our total cost of services are tied to increases in head count as the.
The higher people, who deliver specialized services to our clients.
The cost of service at the percentage of revenue is not heavily influenced by the service offering and mix in the state. It is primarily influenced by the geography location from which services are provided.
We expect of of geography mix to be fairly stable in the near term.
In the second quarter, we generated 53.1 percentage of our revenues and the Philippines.
The 2.7 percentage of our revenues and in the United States.
And for pinpoint 1 percentage of our revenue from rest of the world, mainly driven by our operations in India and Mexico.
I sort of zone.
And the input cost of service at the percentage of revenues of 57.7 percentage.
And the second quarter compared to 66, 1% based in the play out of here.
The increase was primarily driven by a full 5 percentage of mutation and the Philippine peso and on.
Additionally, the challenges that's the incurred in Q2 of 2021 to enable of virtual operating model.
We expect the cost of service as the percentage of revenue to remain flat for the remainder of the year.
In the second quarter of G&A expenses.
$177.8 million.
Switching to go to $129.4 million, 1 time expenses for on time share bonus.
Made in connection with the IPO.
The $6.8 million for non recurring he made the IPO bonus and other IPO related expenses.
We started a rule for stock compensation expenses and the current quarter of $5.8 million, which was brought it did for the period from the IPO date.
And there will be and of the quarter.
For the rest of the year, we will see food part of the impact of the expenses.
2 of these new equity grant I don't know if any.
For the grants awarded between now and the end of the year.
Excluding these items.
Zane and for the second quarter was 35 by $9 million on.
20% of revenues compared to $25.7 million or 22.5 percentage of revenue in the play.
The current quarter included some public company expenses growth since the June 11th IPO date.
We will see the food part of the impact of this public company expenses in the third and fourth quarter.
In the second quarter of 2021, we earned adjusted EBITDA before <unk> $1 million and.
$24.5 percentage compared to $26.4 million and 23.1 percentage earned and the second quarter of 2020.
The improvement and adjusted EBITDA margin was put on.
And literally driven by the revenue growth and based on his G&A efficiencies, despite the negative impact of Philippine peso optimization.
And the second quarter of our GAAP net income was the loss of 1 of $5.9 million on a loss per share of <unk>.
$1 and 14.
As I outlined earlier this of this.
And there's the parallel to the $9.4 million dollar onetime expenses related to find some shares and.
The $6.8 million for non recurring the meat IPO bonus and other IPO related expenses.
By comparison in the prior year, we earned GAAP net income of $8 million.
And EPS of 9 cents.
Included in all of the GAAP net income losses, and income tax benefit of $7 million, the sort of thing from non recurring deduction.
Related to expenses and good and the IPO with lower the full year of taxable income.
And the second quarter of 2020 and.
And the expense of $1.6 million.
In the second quarter.
And we earned and adjusted net income of $31.4 billion.
And adjusted earnings per share of 32.
By comparison and the year ago period, the earned adjusted net income of $17 million and on.
Adjusted EPS of <unk> 18.
Now moving onto the balance sheet cash.
Cash and cash equivalents due debt.
1 of them $95.9 million as of June 32021.
As of December of 'twenty, 'twenty total available cash and cash equivalents.
1 of $7.7 million.
Cash generated from operations was $5.8 million for the second quarter.
Compared to $25 million and the previous year.
The current quarter was impacted favorably by an increasing of bonds the receivable, which was driven by the 57.4 percentage year over year revenue growth.
I would like to highlight 2 other key cash flow related items and the second quarter.
The speed of pre IPO dividend 2 of share or does that time of $50 million and April 'twenty 'twenty 1.
From the company cash and we received gross IPO proceeds of $127 million and June 'twenty 'twenty 1.
We will use the IPO proceeds in the third quarter 2 state of the Phantom share of non recurring theme at IPO bonuses that could own.
And in the current quarter.
Although the capital expenditure in the second quarter.
Pinpoint $3 million compared to $10.2 million and the same.
And period of 2020.
The growth and capital expenditures.
Primarily driven by purchases of computer equipment due to increased head count.
Of our capital expenditure and will continue to expand and the second half as we catch up on the other facility expansion from last year and the first half of this year as part of all of the return to office plans.
At this point I will outline of a third quarter and full year 2021for natural.
For the third quarter of 2021, we expect total revenues and the range of $1.82 million to $1.86 million.
And that put us in the year over year of growth of 53 per cent beat at the midpoint.
We expect the on our Q3 adjusted EBITDA margin of 23, 1 percentage to $23.5 percentage.
Looking forward.
Full year 2021, total revenues in the range of $705 million to $709 million representing.
For the same thing year over year of growth of 47.9 percentage at the midpoint.
We expect the on a full year 2021of adjusted EBITDA margin of 23, 7 percentage to 24 point of 1 person. Please.
The other outlook includes of in anticipation of our cost of service at the percentage of revenues remained roughly flat.
We also expect to incur a full quarter of public company costs and a small increase to operating expenses as the could you just somebody investments and other digital and you know we shouldn't capability.
And prepare for our teammates who returned for the office.
And I'm going to 100 back to price before we take care of questions.
Thanks apology, but for.
Where we get the Q&A I want to share a task of teammates story.
As I briefly mentioned each of your task of offers an opportunity for teammates to apply to have 1 of their children's school tuition paid for by the company.
We started this program, which we call the task of scholarship program to invest and the education of the next generation.
The program, which began in 2012 with just 3 scholars will send 755 children. The great schools this year.
<unk> was the task of teammates for 9 years as the single mother and the Philippines. She worked hard to care for her son John.
Kelly was able to St. John to private school with the help of the task of scholars program.
After he graduated from high School and University, John decided to move back home to care for his mother and retirement.
The Elliott told Jon There was no better place to start his career and task of John applied and was hired and today John is the task of teammates supporting our fast growing logistics marketplace. It.
And as early twenties tarnish the already started saving for its own retirement for the cask us retirement program.
The Elliott and John are great. Examples of the ways, we aspire to improve the lives of our teammates all around the world.
With that I'll ask the operator to open the line for a question and answer session operator.
Yeah.
Thank you as a reminder, and ask a question you will need to press star 1 on your telephone to it.
So all of your question press the balance sheet, please stand by and compile the Q&A roster.
Our first question comes from Jason Kupferberg with.
Think of America you May proceed with your question.
Hey, guys. This is Kathy on for Jason Great corner and of the gate and thanks for taking my question first just wanted to ask about your for your guidance and yet the guidance I know at Empire, the pretty minimal Moreover quarter growth for respectively for the third quarter and fourth quarter and.
And from that kind of 50% plus you guys delivered in Q2 I. Just wanted to know is that just an element of conservatism or are the other dynamics in play there.
Kathy Thanks, so much for the question so clearly the year's off towards the very strong start and the first half of the year. We saw organic revenue growth of over 53 per cent and we signed a number of major contracts and the first quarter that ramped into the second quarter that kind of early success can result in some difficult sequential.
For over quarter comps, but we feel very confident and todays guidance of over 50% revenue growth for the third quarter and full year organic revenue growth, that's north of 47 per cent.
Okay Super helpful and just 1 quick follow up for me and nice to see that the client concentration decreased just curious I know you guys said the top 1 client with 27% how are how big was the top 2 client and overall you know are the top 2 growing much faster than the overall client portfolio are you kind of thing.
The growth being driven from the sort of maybe the non top of call. It 20 clients going forward. Thank you.
Yeah, Thanks, again and Cassie so.
As I said, our largest customer saw improved revenue concentration, which was 32% and 2020 and Q1 of 2021. It was 29% and then in Q2 of 2021. It was 27% so while that client is continuing to grow.
Very aggressively and the rest of the business is outpacing their growth as far as our second largest client. They represented 12% of our Q2.2021 revenues, which is roughly consistent with where they were in Q1 of 2021 as well.
Okay perfect. Thanks, guys Congrats again.
Yes.
Thanks for your next question comes from Puneet Jain with Jpmorgan you May proceed with your question.
Hey, Thanks for taking my question and very strong because of the.
This was easily the highest ever sequential increase and revenue for <unk>. So given the can you talk about your ability to replenish the pipeline and backlog specifically pipelines for new clients given the there was so much upside and this quarter.
Thanks, so much for the question Puneet. So currently the pipeline is very strong.
And we're on pace to exceed the records that we set in 2020 for both new client wins and win rates.
As I said on the call we've seen very strong demand among our fintech and retail and e-commerce customers in particular and the recent wins and the pipeline momentum are giving us a lot of confidence as we begin to look at the next fiscal year.
Clearly the.
As I said on the answer to the previous question Q1 saw a few really massive wins that helped us scale into Q2, and our sales team is well aware that we need to go and replicate that success and the back half of the year.
Understood.
And you added about 4000 employees and this quarter.
The total to about 8000, new employees and the first pass.
Can you talk about like the U S also seeing any challenges and the hiring market the supply challenges, which lot of peers have talked about it seems like your attrition was still below 2019. So what are you doing that is keeping the attrition low and helping you hire and such large numbers.
Despite the challenges elsewhere.
Yeah. Thanks for that question for me.
2 we had on on time global hiring SLA of over 98 per cent and as you pointed out we added 4000 net new positions and we added hundreds of new roles and the United States and over 1000, new roles and the Philippines and over 1000 new rules.
India. So we're really proud of the success of our recruitment organization.
Ultimately, we think this comes down to our employer brand, which use we believe are amongst the strongest in the industry and particular in the markets that we've been and for a very long time like the Philippines.
We are seeing some recruitment challenges and particular in the United States and that's something that we're being very vigilant as we head into the back half of the year.
Got it thank you.
Thank you. Our next question comes from Maggie Nolan with William Blair. You May proceed with your question.
Thank you congrats and and you definitely saw strong performance across the board, but in particular and it seems like you saw some good growth with and AI operations. I'm wondering are there any new client additions and the segments or any other factors that are giving you confidence that you are building some good momentum and that segment.
Thank you so much for that question.
We've seen both organic growth inside of existing customers for whom we are delivering <unk> operations as well as some exciting new wins, we had and existing autonomous vehicle customer, where we were providing some consulting services at our AI operation services and our teams there.
Now really helping to shape the future of self driving cars is.
We have done for other customers and the past so it's a it's a very exciting segment to watch and and obviously 1 net is growing very quickly for the house guest.
Okay. Thank you and then you know his.
Strictly focused on clients that are quite disruptive often tech companies and that's something that's distinguished of your from your peers as you're thinking about being more acquisitive going forward. How important is the potential target companies client base. When you think about things like cultural compatibility and being able to deploy employees across.
Different task of accounts.
Yeah, it's incredibly important and so we're looking to acquire businesses that will either expand our geographic delivery footprint.
Specialized service capabilities or get us deeper into our existing end markets and obviously, we want these acquisitions to be accretive. So we're looking for assets that are as close to us.
Possible in terms of growth profitability and and digital work mix.
But the thing that we absolutely will not compromise on is the culture I've told the team that we're only going to do acquisitions that are culturally accretive and given those factors, we're going to be very selective about the acquisitions that we choose to make.
Alright, thank you so much great quarter. Thanks.
Thanks Maggie.
Thank you. Our next question comes from Matt Vanvliet with <unk> you May proceed with your question.
Yes, thanks for taking the question guys and nice job on the first quarter out of the gates here I wanted to dig in a little bit in terms of some of the new business.
That you've won and the newer markets.
And maybe if there were any deals to call out.
And whether and Colombia or degrees. In addition to the the strength that you mentioned.
Yeah. Thanks, so much for that question, Matt So we've seen.
Really rapid uptake in Colombia, and it's a market that we entered at the start of this year and have signed some very exciting on demand delivery customers that were new to task for us as well as adding spanglish Spanish language capabilities to existing task of customers.
And Greece. The same thing has happened we've had multiple new clients enter the Greek market with us in Q2. Some of those are new logos to task for us, but the vast majority are expansions from existing customers, who are looking to add European language capabilities.
Alright very helpful. There and then as we think about.
And the ability to I guess.
Continue to ramp through the end of the year were there any.
Major deals.
And that were closed near the very end of the quarter that we should think about ramping into the back half of the year similar to what you mentioned the happened and the first quarter.
And maybe zooming out a little bit from that.
Oh Gee, how do you how do you feel about in terms of the the total visibility into the second half revenue how much of sort of already been booked and how much should we think about as you know still out to be to be closed and the back half. Thanks.
So price do you want to go for some final until the second question Yeah, absolutely. So I think that the the second quarter was a very strong quarter from a sales perspective, nearly as strong as of the quarter. We saw in Q1, and we expect to see ongoing ramps from from both existing and new.
Clients that were signed in the second quarter.
We're very confident and the guidance that we've provided.
Debt, we will get to $705 million to $709 million of revenue this year.
Yeah and just.
And I don't know what Brian said, we have very good visibility like you say it in terms of the closure of that we add from a new look and.
Q1, and the greater than the party someone for states and estimating youre starting with the critical we started the year with great visibility on just starting this quarter with great people.
Wonderful. Thank you great job on the quarter guys.
And that.
Yeah.
Thank you and and as a reminder to ask a question you will need for press Star 1 on your telephone. Our next question comes from Dan Perlin with RBC. You May proceed with your question.
Yes, good evening, it's a matter of.
Roswell on for Dan Congratulations on the next quarter.
When it when it comes and winning new business or are you generally part of a sort of request for proposal process or is it.
And coming to you and if you could talk a little bit about what win rates look like and the quarter.
Matt. Thank you so much for that question. So task has long been seen as a disruptive outsourcing service provider.
And we're often the first outsource service provider that are fast growing technology clients turn to so and those cases there are typically not formal RFP processes, we may see competitive processes, but generally.
We try to use our relationships to get in early and be the provider of choice as these fast growing technology companies begin to the outsource some of their their specialized services.
Increasingly we are seeing our disruptive clients have grown to become public companies themselves and with that maturation does come procurement teams and organizations that are dedicated to mitigating risk and so the biggest question that we've heard from those companies in recent years is actually and if we do business with you what's to say youre not going to get.
And by 1 of the traditional players and so 1 of the nice things for us.
And going public is that it is a communication.
Communication to our customers into the market that we absolutely intend to remain independent and is really helping us to win business from them some of those newly public companies.
As far as when rates were going to break out both new client wins and win rates on an annual basis, but as I said before we're on pace to exceed our record setting new client wins and.
And when rates from 2020.
Excellent and then just a quick follow up on that what.
And what was the FX impact on the revenue growth and the quarter, you mentioned that the peso hit on.
Cost of services and I was wondering if there's anything on the revenue line.
Yeah. So I think that's still the bulk of Fortunately for us.
The majority of our revenue is built on the U S. Dollars. So we actually do not see any broad ex impactful from a revenue perspective, but we do see impact from a cost perspective, when we do the translation from let's say as an example of peso to U S dollars and that was the.
The piece of all the <unk>.
Appreciated by our book tour and out for some day.
Year on year from Q2 of last year that duty of current gives us that day.
The impact of the cost of service line and also the G&A as you kind of answered those but there was no impact on the revenue per system.
Okay. Thank you very much.
Matt.
Thank you and as a reminder to ask a question and you will need to press star 1 on your telephone.
Our next question comes from Dave Koning with Baird. You May proceed with your question.
Yeah, Hey, guys congrats on a huge quarter.
Thanks, Dave.
Yeah. So I mean, it looks sequentially like you grew and as much as you did revenue just a few years ago per quarter. You grew that much in 1 course of its pretty impressive, but I guess right.
When we think about how big this year is going to be can you still do your 25% growth off of what just seems like such on passive a massive count this year.
Absolutely, we guided and our IPO process to think about 25% year on year revenue growth and the medium term.
And we absolutely intend to deliver on that for.
For 2022 and beyond.
Gotcha, Alright, great and then I guess.
I guess, 1.1 just quick kind of financial think the what was the normalized diluted share count and Q2 and it got a little hard to tell because of the the <unk>.
GAAP loss, and then and then I guess, what should it be and Q3 as well.
Yes.
We just pull of them and just give me 1 minute.
Yeah.
So the nominal share count as of the end of.
On June will be about 92990, 2 billion 957 and 493.
But in terms of the additional additional stocking going on.
We would be giving you.
In the following quarter that number is going to change. So that is something that is not currently estimate able because of the diluted share will change and once we start banking, new chefs, but and bringing that I'd, probably say in that ballpark.
Okay, that's great and maybe if I can just sneak 1 more and it looks like Q4 margins kind of implied 22, 23% is that a good place to kind of start for next year just to think about 'twenty..2 'twenty 3 and then maybe grow a little a little bit from there into 2023 or I'm, sorry into 2020.2.
Yes.
And so the person in 2 parts 1 is in terms of the what.
What I mentioned earlier.
Sort of the EBITDA and hedged to Wisconsin, and we wouldn't be getting full quarter of public company costs and <unk> been before we did not incur in Q2. It was only just.
Just a couple of weeks that'd be very public and futile and the second of you're going to incur some expenses and the investment and digital and depending on the mix of will back into the office.
But I believe that.
In the short term perspective of 23% would be of good adjusted EBITDA number of all of this business to deliver.
And for this year I'd be Mcbride will deliver about $23.9 percentage in 'twenty and good luck.
Gotcha, Yeah, great job. Thanks, so much.
Thanks, Dave.
Thank you. Our next question comes from James Fawcett with Morgan Stanley You May proceed with your question.
Thank you so much and apologies for the background noise, that's loud, but I wanted to ask you mentioned kind of recruitment challenges and the U S and.
Are you seeing any potential for wage inflation and how.
Are you thinking about your ability to pass that on and customers and and.
And if you're 1 of your ability to do that and what kind of lag there may be if you do have some wage inflation.
Yeah, Jim It's a really important question. So we've got a robust process to ensure that our employee wages are competitive with that said, we aim to not complete purely on wage instead of task as we aspire to create a best in class of employee experience, which includes differentiated benefits like our health care program retirement.
Plan and our world class facilities. So we have seen wage pressure in the United States and we've got a wage review and increase process, which is designed to respond to those pressures and every geography that we're operating and.
We do have cole of provisions in the contract with the vast majority of our clients, where we're able to pass along the wage inflation.
And those markets in most cases.
And it is important just to say again debt in the second quarter, we achieved and on time hiring SLA of 98% globally, and we actually exceeded that number in the United States.
Okay.
And it's good to hear and then separately I wanted to ask just about acquisitions, you kind of mentioned the euro.
Looking at doing different types of acquisitions, and including geographic expansion, but I'm wondering if you can give a little color on the types of capabilities, maybe looking to add as well.
Yeah, 1 of the areas, we're seeing a lot of growth and at the moment is trust and safety and and by that we're sort of.
Bringing together the financial service work that we're doing and the areas of anti money laundering.
And know your customer with some of the work that we're doing with clients and safety lines and general investigations, we work for with marketplaces doing fraudulent good investigations and even in some cases financial crime investigations and so we're very interested and that general area as the next line of specialized.
Service that we'll be able to break out so here the.
And the type of companies that we would look to acquire would be specialists and in some of those services.
That's great great color. Thanks, a lot.
Thanks, Jim.
Thank you and I'm not showing any further questions. At this time I would now like to turn the call back over to price matters for any further remarks.
Well and clothing I just want to again, thank all of our task of teammates for all around the globe, who have worked tirelessly to deliver what we believed to be of very strong first quarter as a public company I'd like to thank all of our new shareholders for joining us on this journey and we will see you all next quarter for our Q3 investor.
Paul.
Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.
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