Q2 2022 TDCX Inc Earnings Call
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Ladies and gentlemen, thank you for standing by. Welcome, and thank you for joining the TDCX second quarter 2022 results conference call. Throughout today's recorded presentation, all participants will be in a listen-only mode. The presentation will be followed by a question and answer session. If you would like to ask a question, you may press star followed by 1 on your touch-tone telephone. Press the star key followed by 0 for operator assistance. Thank you.
It's my pleasure and I would now like to turn the conference over to the management. Please go ahead.
Hello everyone and welcome to TDCX second quarter 2022 earnings conference call. I'm Jason Ling, the head of investor relations. Allow me to introduce management on the call. We have our executive chairman, founder and CEO Mr. Lahorn Junig, our CFO Mr. Chin Zhe Ning and our PVP of public development Mr. Edward Hall.
Before we continue, I would like to remind you that we will make forward-looking statements which are subject to risks and uncertainties and may not be realized in the future. You should not place any reliance on any forward-looking statement.
Also, this call includes the discussion of Southern North IFRS financial measures such as adjusted EBITDA, adjusted EBITDA margin, adjusted net income and adjusted net income margin.
For a reconfiguration of the non-IFRS measures to the closest IFRS measures, please refer to our first release on the Form 6K, which are available on our website.
We have provided a convenient translation for the translation of Singapore dollar to US dollar. This was done at the rate of US dollar to 1.3918 Singapore dollar.
This should not be construed as representation that any Singapore dollar amount can be converted into USD, E
I will then share updates on the operating and financial performance.
We take my meantime and we'll go to the call to Lahong. Lahong, please.
Hello everyone and welcome to our results meeting for second quarter of 2022. We're happy to deliver another strong set of positive results. Once again, the people of TD TxF put together another outstanding performance and have navigated through the market's overall macroeconomic challenges. I'm so proud of the determination, results.
And I think Jimmy appreciates the tremendous efforts that GCSE has done to support consistency in building a wonderfully working environment for all of us.
I would also like to thank all our clients for their support and giving their faith in us.
And I'm also happy to report that during the quarter, we had our carbon footprint reporting certified by British Standard Institute, ISO 14 064-1. And for our corporate social responsibility initiative, we just incorporated with TBCX Foundation. Our focus here is on building long-term partnerships to absolute community in Asia through digital empowerment.
Specifically the three key things of digital access.
digital literacy and capability in terms of ready-made digital work and small business support.
Let me next cover some highlights of our financial performance.
We delivered robust revenue growth in 2022 as revenue rose 23.3% to $117 million or $162 million the year 2021 claimed to be year- airs.
This was driven by strong contributions from clients across key verticals, including digital advertising and media, and travel and hospitality, and especially from our expert spy clients, who are growing at the fastest pace in listing at twice the pace that our good revenue growth in 2022.
Now in terms of revenue contributions and verticals, the travel and hospitality, including our airline client, continues its recovery trajectory any other 25% compared to 2020 the war.
Our revenue from travel in hospitality is now higher compared to QT 2021. We're still some 16% below our peak order in this phase in 2019. There's still some room for us to grow and this will be dependent on the outfits of global and especially Asian travel. The prospect of North Asia travel reopening in 2019, of course, but this is not confirmed yet.
as I speak.
On the FinTech side, we continue to rise at high percentages year on year and it remains our third largest vertical.
To recap, we sell streaming gateways, crypto exchanges and other tech companies. And as shared before, we are always taking a careful approach to perform while we are happy with our progress in this space, the revenue contribution is around 1% and so the risks are manageable.
We are looking to add more Fintech clients and also to continue to bring in a variety of clients across different verticals such as e-commerce to do their business.
On the digital advertising media vertical, we continue to deliver double digits percentage growth. We are near powered by our strengths in the sales and digital marketing survey and the acquisition of new finance. We have onboarded the leading short-form video social media platform and we started to contribute in Q2. I've shared before it will take time for any new funds to start contributing meaning to meaning in terms of group revenue.
but we are happy with the progress we've made there.
On our earnings and quality growth, even as we pressed on with our business expansion, we maintain our focus on policy growth, adjusted net income, which could help the performance, share plan costs for a life-or-life basis comparison. We hold 35.5% yield on the S&P 22 million US dollars or 13 million US dollars. We continue to deliver our 2.2% yield for fiscal year 2020 with adjusted interest margins of 41%.
in 2022 and I want to take this opportunity to thank our CEO Mr. Chin and his team of incredible professionals for the continuous effort in cost control and efficient planning.
The quality of our earnings growth is also shown in the strong cash flow conversions. QP2032 next cash from operating activity was $76 million almost doubling year-on-year. I'll see who will share more details on the numbers in the later sections.
From a business segment point of view from QT2022, we have remained our content, monitoring and moderation services as consent, trust and safety services. The change reflects the industry's broader view that content moderation services are part of a larger group of services that include other trust and safety related services and help enhance our ability to track our performance.
The consent, trust and safety service comprises program evaluation and monitoring. Trust and safety services such as those to ensure authenticity and accuracy of listings, as well as data annotation services for machine learning.
Our total revenue from Southeast Asia spent 91% of first half of 2022 revenue. In the latest edition of the Internet Economy Research Program by Google, the NASA SANE, Southeast Asia now has a total of 440 million internet users, while Southeast Asia's internet economy is expected to reach...
$360 billion by 2025, powered by e-commerce, food delivery, and digital financial services. We are used to print TBCS provides investors with strong exposure to Southeast Asia, fast growing digital transformation.
Our plans to roll out Indonesia and Vietnam are on track and we aim to launch operations there before the end of the year. The new markets add further flexibility to offer key Southeast Asia languages, in a multi-lingual centralized model as well as a decentralized model.
In addition, North Asia is gaining momentum with a contribution of 70% of revenue. Our expansion in Asia Pacific, Europe and Latin America was strategically planned with the objective of positioning ourselves well to unite stronger and meet the changes in the CX outputs in place. This is even more timely now with the rapid changes in the business environment and I'm confident our end of the screen will provide us with a competitive edge going forward.
Now, on time rings, we have continued our business development momentum, signing up a total of 25 logos for the first half of 2022, more than triple the age we signed in the first half of 2021. This includes two Southeast Asian market leaders, added in Q2, a leading regional airline and one of the largest integrated top e-commerce platforms. Please demonstrate.
our strength, once again, leading the trouble of the economic vertical that concerns our leadership in these sectors.
Our long-term account now stands at 60 as of 1st June 2022, at 40% compared to 43 a year ago. Revenue from new economy plants stood at 93% for the first half of 2023, receiving efforts to reduce our current concentration, and our top-sea plants now represent 57% of 2020-2022 revenue, compared to 63% in 2022-2021.
Now I'll hand over to Mr. Ching to cover the financials in detail as well as an update on the guidance.
Thank you, Rahul.
Let me first share some details on our Q3P0Q2 financial performance.
Revenue rose from 3.3% to $117 million US dollars given by goes across the omnichannel CX and sales and digital marketing business patterns.
Adjusted EDR, which excludes share-based expenses for the light-for-light comparison, fasting
adjusted net income which similarly exceeds share-based expense who Sonic the
Next topic for the period is going at a lower 90.6% on a reported basis, even largely due to the implementation of the performing chairman, which did not exist in the phase period last year, as well as how you can get extended.
Next, we share more details on our Q2 family performance by the services tax can we offer.
Revenue from omnichannel clear solutions rose 90% to $16 million, due mainly to higher business volume driven by the expansion of existing campaigns in the same track and technology vertical.
In addition, different mornings for our two travel and hospitality clients have benefited from the gradual recovery from the impact of the COVID-19 pandemic.
Although the recovery has yet to reach pre-pandemic levels.
from here that digital marketing services increase by 64%. In terms of ourokayNow thank you
This is continuing volume expansion of existing content by key digital advertising and media clients.
I'm asking for Q and A very soon.
Content monitoring and moderation service has been renamed as Content Trust and safety.
The available trust and safety services that were previously classified under omnichannel state regulations and other services which can currently be reasonably identified and classified will now be reported as content trust and safety services.
In QQQ, zero QQQ running from content, charts and safety services rose by 6% in 19 million US dollars, primarily due to an increase in business loans from a client in the travel and hospitality for people.
In QQQ-OQQ, Omnichannel CX makes up 59% of our business, while CUBE and digital modeling is at 24% and content trust and safety can be determined respectively.
Let me share some details on our experiences.
For Q2C, thank you. Operating costs as a percentage of them is good at 27.5%.
Excluding TSP costs on a life-for-life basis, this looks at 25.3%, lower than 25.3% for a case period last year, largely due to lower depreciation expenses.
Controlling benefits expresses, we mean, the largest portion of our focus of produce cost base.
Our employee benefit expenses increased by 31% to $7.15 a year from Q2.
Excluding TSP costs for a life-to-life basis and quality of life expense will not be free-starting with that.
higher than the annual goals of 2023. The sooner we can higher the cost of our staff costs and the increased competition for talent in the respective markets that we operate in.
Our decision extends to the client-side experience, largely due to certain obvious innovation efforts in Singapore, Ireland and Turkey. We are very appreciative during the period with no big-ticket capital expenditure in cut
All other expenses which include items such as recruitment, transport and telecommunication expenses rose 1% from Q2 to 2022, lower than our revenue growth, which demonstrates a continued focus on critical cost management.
Next, let me share some details of our first half of the NPT financial performance.
revenue growth is 25.1% to $226 million, seemingly driven by growth in the omnichannel states and Motors can be proven to be brothers.
Adjust the dividend rate 25.3% to 17.1 billion US dollars with margin stable at 31.1%.
Adjusted net income is excluded instead of share-based expense raised by 35.2% to 43 million U.S. dollars.
That profit for the period goes at a lower 9.5% on a reported basis due last week to the implementation of the common share plan which did not appear in the same year last year.
In terms of the problems of services we offer, only for omnichannel CX solutions, we will be paying 1% to 133 million US dollars, mainly to higher interest rates, given by the expansion of ECT campaigns.
That means that sales and digital marketing increases by 50% to $1 million.
with the expansion of existing campaigns from key clients in the digital, advertising, and media vertical.
The revenue from content trucks and safety services rose by 6% to $38 million US dollars, primarily due to an increase in liquid oil for the climate, only through information rings in China and pubic Apéc Hello videoers. Thank you for viewing our session today. There is more talk about World human rights. From this panel, this is a few of the breaking news.
Thank you.
Only channel 6 will start 59% of our distance.
while sales and digital marketing is at 10% and content trust is at 10% respectively.
Let me share some details on our first half.
Okay
The friends are laughing to hear what I shared earlier for Q3 2018.
For first half, the meter is seen operating hot at a percentage of values of 9.3%.
Excluding TST-PAW, Db2 at 35.0%, lower than 30.9% for a stable period of 2021.
Thank you.
Employee Benefit Express increased by $35 to $150 million for the whole time and would have increased by 12% exceeding TFT costs due to high wage costs and increased competitive dynamics of the market solutions.
I will be patient expenses to be tried by 5%. Lastly, we will be considering renovation, also includingRec 719
All other expenses, like 4% for the top 1020, lower than our W2, which will not shift our incomes, will continue to be the next anniversary of this issue.
Last week, let me provide updates on our CBS engine 2 outlook.
We are really encouraging the FYC to continue our work which we should do our key lines and results analysis.
Our goal here is to identify all theraman. Wegr4oned hoc audit at the Relativeresh
This represents the yield green of 30.1% to 21.6% compared to FY 2021.
The company's financial information is paid in Singapore dollars.
However, we provide the convenient translation to chat leaders who are not familiar with the Singapore dollar currency. One can be a costly contract as content of numbers in US dollars.
At the approximate rate in effect of a new 30th currency of $1 million to $1.3916, which represents around 467 to 455 million U.S. dollars.
Previously, as we are talking, we have a mass-based simulation of 1 US dollar to 1.3534 US dollars, which represents around 486 to 499 million US dollars.
We know that there is no change to our guidance in Singapore-Donald Trump.
With a complete focus on cost management and employee productivity, we maintain our full year by the hatha.
This is just a special occasion.
Thank you, Mr. Chin, for bringing us through the results presentation.
We are now ready for Q&A. Before we start, can I just make a request that you keep your questions to 3 at the maximum?
Thank you.
Ladies and gentlemen, at this time we will begin the question and answer session. Anyone who wishes to ask a question may press star followed by 1 on their touchtone telephone.
If you wish to remove yourself from the question queue, you may press star for goodbye too.
Anyone who has a question, make a star followed by one at this time.
One moment for the first question, please.
We got the first question from Tang Vit from Goldman Sachs. Please go ahead.
Thank you very much for the opportunity to be signed. Any questions for me, please? Firstly, on the guidance, can you give us a way why are you iterating the current guidance? What is the basis and assumption for this? What's the confidence level that you can achieve? In particular, why do you expect the second half growth to accelerate sharply? And for a part of the world, there's a likely return in trouble in the end. Have you ever factored in any of the impacts on inflation too much?
that we are seeing now is coming in from new logo with existing customer. So that question number two. And last question, what is the management current view around the global slowdown in the global tech space and that comments around cutting costs, especially for your top social media clients, any further color you can provide. Thank you.
Thank you very much for the question Laurent-Rounic here. So yes, on the guidance, very clearly we've re-iterated our guidance for the full year. We have already revised it at the last quarter. In retrospect, we were one of the first to go out there and revise guidance on new information that was happening.
the quickly transforming macroeconomic and geopolitical landscape at the time, which obviously has not improved much. Rather, what was expected of the climate has been confirmed. Now, why did we need to raise our guidance? First of all, the first strong half that we have, the first half of the year is recovered. And then the next higher half, the second half is recovered. Why did the climate Season 1 noses the 2021af as a years changingnais timeframe and the late spring? Why did we need to increase our guidance for the next year and the late spring? What became more real is that there will be more time for drying options, Southernpm your challenged Gu promoter, because you will want om with time you melt up in the spring.
the last year. Um so we're decent results. Uh 21.5% growth in our revenue in the first house. Um but also I would want to come on there. My my team doing a fantastic job here at operations. And they've done very well throughout the summer
We see the efficiency of our operations and our management in our business development. We mentioned about bringing new logos. In the first half, we brought in three tons of new logos and we did last year. We took the five new logos, so that's helping us to obviously bring some more growth to the business.
We're getting a bit closer every day to the end of the year. We have a bit more visibility although...
A disability can come with a number of possible challenges around attrition, challenges around inflation, challenges around the variability, seasonality. So you're never completely shielded or protected from what may happen before the end of the year. Nonetheless, we have enough confidence at this moment to stick to our guidance. So that's a.
but important to reiterate. The new logo rings, which was your second question. So a bit more color here. So we have 15 new logos on the second quarter, 25 new logos for the first half.
If you remember, in the first quarter we won with the short film video platform. In the second quarter we brought in a regional airline from Asia.
A new commerce platform that is very exciting, a regional player. We brought three synthetic companies, one insurance corporation.
So there are a variety of plants in different sectors, not just in the economy as well, in the nutrition industry.
So there is no idea of where to go. So our business development team has worked very well and has really performed a good job here.
So the confidence is really building and our ability to bring new business. The engine is working. We started from the beginning. We came into this thing with an objective to drive open growth as our first entry point in the urban industry. So our new vehicles are accelerating and the growth from this level really starts to fail.
I don't know if you can as well, but there are now 65 that have been launched.
But there are still ten in that group that have not been launched yet. So there is some upside moving forward in the coming quarters.
So that's the local news. Now your question is related to tech and how is that impacting us. We're looking not so much at the tech sector, but maybe the businesses that are, or the big sectors that are impacting us or driving us. So as you know, we have a lot of business in the digital advertising space and we understand that digital advertising space is going through a lot of pressure. For sure.
Right now, what we think is going to happen is possibly depending on the types of product lines that we're working, like the omni-channel CX solutions, could be under a bit of pressure for the digital advertising sector. But the reverse is true of the thousand digital marketers where as the...
industry is getting more and more competitive, we think there's going to be more need for our sales and digital marketing services and we've seen that in our numbers, it's growing at the factor space once again for TVCX. So that's one area that we're watching and watching the impact. Trouble in hospitality are sectors that are picking up quite significantly as we speak.
And I think there's also a potential upside here with travel that has not recovered in North Asia, in Japan, and not that much in Asia, in China. So when that comes, and I don't know when that is happening, we'll see how it impacts us, how it impacts us physically. So that's how we're watching the space. Thank you.
Thank you.
The next question is from Varun Ahuja from Credit Suisse. Please go ahead.
Hi, thanks for the opportunity. Got three questions. First, if you comment on the visibility that you may have on the business, personally, in terms of new talk to clients, you've got three months' visibility, six months' visibility. And compared to six months ago, nine months ago, you can get back on the review, so we'd love to hear.
How much comfort do you have in the next three to six months in terms of growth and the revenue? And if you can in the same light comment upon your views on 20 and the 3, I know it's too early, but how do you see it progressing given 2022 is there almost and getting to second half now. I think Mark would like to know how you see the input into the 3 as of now.
Number two, if you can, I know you talked about new client edition, which is 25. But if I look at your number of clients is 60 and in December it was around 52. So there is a gain of significant, my understanding is you have completed that restructuring phase where you had yet go over the unprofitable accounts. So it looks very high.
part of your growth strategy and even in this environment, the valuations of other companies may have come down, especially on the private side. So how are you looking at that space that will be helpful? And lastly, just one bookkeeping question. The accident has moved up this quarter. So Mr. Singh, if you can comment, how should we think about it, what has happened in this quarter and what should we think about in the next few years? Thank you.
Thank you very much for the question. So regarding the visibility, if I understand correctly, and your question, so it's a bit early for us to prepare for the visibility in terms of duration. We used to have maybe six to nine months of visibility. We've cut back to three to six months. We're still in this kind of range.
of vision, I would say, in terms of where our clients are budgeting. We're in a few regions. One of the uncertainty that the clients are facing in planning and budgeting and having to adapt in some occasions. The market volatility as well doesn't help very much. We're entering the budgeting process right now. We're a member of our clients.
But for that moment, I think we'll have a clearer view as to what 2022 is looking like. So it's not unusual. It's quite common at this period of the year. But content thinking, strategizing, and we get involved in these discussions with thinking of ideas and how we're going to make the year next year and what kind of projects we're going to be working on and what kind of ideas are going to be.
opposed to them.
beginning to happen as we speak, as we speak the answer is a tumbling function. for a limitation, you've
hopefully expand next year, since it's a little bit better economically. But for now, it's very awkward.
On the client side, I think Jason can talk about some of the very important issues that
detailed numbers, but I think it's a question of calculations here. You did mention there was a high churn. I want to confirm that there isn't. It's a very, very, very low churn. It's not really that adverse to us. On the contrary, we've got a very high revenue retention and time retention as usual. And we're adding time. It's just that in the numbers we've provided, we just mentioned time.
that still sort of over 10 clients that are not launched yet.
So the active launch client power is actually different from the logos that we have signed.
So I hope that helps.
Can you just repeat the sort of, I think the big question you have is on capital management, cash flow and capital management is that correct?
Yeah, and more on the MNI side, what you would think it would be almost like six months or five years more than one?
Yes, absolutely. I can touch on that maybe later down the road, what we can talk about.
So, I mean, we've worked very hard on that front. Edward Go and his team have reviewed about close to 100 targets.
if not more. Interesting situations here, some opportunities. Once again, I just want to reiterate that we're looking for a quality target.
So obviously I work with one of the, there were a number of those that didn't meet the criteria. We studied from day one, once again we're looking for targets, we know that we can leverage our organic growth to be a bit picky and choosy and we absolutely are following this direction. But we have a nice pipeline, a nice portfolio.
As you know, Varun, it takes a bit of time to conclude, but we're quite set on a number of targets here that I hope you'll bring to your attention soon and it will be interesting. But it takes time. And obviously we have some cash in the bank that we only could produce and that would be very useful. And we have big growth targets, we want to accelerate our strategy so that's...
It's definitely working well for us at this stage, and looking forward to telling you more about it.
I think the last question was on the backside.
That's re the change really on the taxs.
What was the question on tax? So this quarter the effective tax rate looks like 129 percent. So I think the value of your discussion on the desk should be closer to 23 percent full year. So anything which is happening there and how should we think about the tax? Yeah, okay. The tax situation for the Malaysian tax is driven by two main factors. The first one is immigration, prosperity tax and what we can measure.
by the government of last year's analysis of the budget. And for the quarter of two quarter two, we have the Philippines business unit that used to enjoy the...
Income tax breaks for quite a while. You have the tax holiday suspended due to the implementation of the central office.
status that is listed on all the video players in the committee to compare the certain number of
workers to be working in office as opposed to the work from home situation and it secret honed in leading in order to have healthcare workers be able to
with the target, the SIPB, getting employees to come back to office. We had to incur the standard tax exposure for the Philippines unit effective from second quarter that was announced by the Philippines government. And these are the two main...
access to the higher text sense for the group.
Okay, thank you.
Thank you very much. Hi, sorry. So before we go to the other question on the line, I think we have a couple of questions on the webcast asking us to clarify some data points during the call, because I think the presentation was a bit and...
So just to clear off the questions, the top two customer concentration now is 57% as of Q2 2022 versus 63% Q2 last year.
In terms of the travel and hospitality space, it grew at 25% versus due to last year. This is still some 16% of the highest ever peak quarter that we had in 2019.
So those are the data points that we are clearing up. Operator, please.
Next caller, next question on the line.
The next question is from Han Tan from HSBC.
Hey guys, congratulations on these good results. My first question is, I noticed that you have been leading a lot of contracts with traditional non-tech companies. So how do you think about these contracts and the margin of growths with this? Do you expect these new accounts to be diluting until the margin?
Thank you for the question. We have a number of clients but the majority still remain very much in the new economy sector. We have a good range of clients who are and most of the range of our clients are in the new economy sector. We have a good range of clients who are in the new economy sector. We have a good range
in Asia-Pacific, so in a fast growth region as well. And although these are more traditional economy companies, we believe that they have a nice growth potential due to the fact that we're coming in early in the relationship as well as they are in the fast growing region.
The impact, considering that 93% of our business is a new economy and 91% of it is in Asia, it's not really material at this point. But we've also said that for some time as well, we're actually interested in the non-new economy sector as well. It's good brands.
and we feel that we can turn with them where they ever need. after all, they have a large show.
or potential as well where we can gain market share.
Thank you. I was also wondering if you could share if there have been any delays in any projects?
And you feel like you have sufficiently de-risked your revenue guidance. So if there is a slow down in the third quarter, would that impact you negatively?
Yes, I mean there are some further slowdowns that may be impacted. We have revised our guidance in Q1 on the back of delays as well as lower visibility for some projects. So yes, some projects have been delayed for us in the past. We see still some slow implementation.
And that's something we've factored into the reiteration of our guidance at this point. We're just watching the space all the time to see whether this is going to continue, is it going to accelerate or reduce. We don't have control, unfortunately, over time's decisions to either accelerate or slow down. And it depends on the sector as well. I mean, if you look at the travel right now, it's real busy, it's really accelerating.
and try and stop pushing us and it's nice to watch.
Thank you. Thank you.
Is my this my tailwind so growth maybe for the second half of the next year?
So, I'll be on the pool.
So you're talking about our competitors constantly dating, right?
Yes, all your winning market share for me.
We've seen some mergers and we hear of potential further mergers in the sector. So the business is becoming very, very scale focused.
And this is something that we had anticipated, that's very much why we're going through the journey, we're going through. The first one is expanding globally and having a global footprint is super important to us.
to remain competitive in the face of growing larger scale competition, combined with clients who are getting bigger and more global, who want to contract with bigger global players. So, DCX is racing to reach that goal and through two ways of any growth, geographical expansion. And then the second one is the important MNAs we are pursuing right now to accelerate that.
It's on our list of important strategic items that we want to progress as quickly as possible.
Thank you very much.
The next question is from Jonathan Wu. Please go ahead.
Q Thank you for taking my question. The first, I noticed there was almost a 10 million benefit from exchange differences from all foreign ops. Maybe could you elaborate a little bit on that and whether you expect this kind of benefit to continue moving into the second part of the year? The second question is on share reports. I think, because that about
You've done about 10 million in share repurchases, while you've got about 20 million in terms of allocation to go. How can we, maybe give us a little bit of colour on that, how can we expect share repurchasing to continue moving forward for the rest of the year, given that there's only about, slightly more than I've talked about?
purchases while you've got about $20 million in terms of allocation to go. How can we give us a little bit of a parallel on that? How can we expect share repurchasing to continue moving forward for the rest of the year, given that there's only about slightly more than a quarter of that? Thanks.
Jonathan, we are not sure where you got the 10 million FX benefit. I don't think we have that in our P&L. Maybe let's set up.
May I know which line, which specific line you're looking at?
It's just a line radical comprehensive income.
Other comprehensive income. Oh, other comprehensive income. Okay, okay. Yes, yes. The translation effect of the forest of disease net effects due to the movement of the currency gain in current not related to our business or not related to the transactional event above the profit report tax.
So that is a translation effect due to the current translation of our land assets, of our forest of fisheries in all the countries that we operate.
So in terms of meaning the Philippines...
The larger units, as I recall, the bigger amounts come from those larger units as opposed to the smaller units as well. We can now suggest that.
So that has got nothing to do with the effect of our transactional level.
Thanks for clarifying tonight.
Hey, Jonathan at here on the question around share buyback indeed for the last five months since the start of the share buyback program. We've been guided by two key principles.
First one is valuations and how we stack up against the tiers in the broader market.
But my tool also on sort of an impact around liquidity and float.
So the management will continue to monitor based on these two guidelines and and if need do we'll continue to implement and This is a share buyback program given that there's another 30 million dollar program and we've It's locked around 10 million dollars to date
There are no further questions at this time and I hand back to the manager for closing comments.
I think, I think, Francie, that was a bit premature because I see there's a line on, there's a KC on the line from CIMB and I have three questions. Yes, I'll give him three. KC. Hi, thanks for taking my question. I think just now you mentioned that most of your recent logo wins are from APEC.
I'm just wondering if management is seeing some offshoring trends, for example, potentially from international, international firms or companies from the western countries potentially offshoring their BTO services to APEC.
Yes, I think depending on how you look at offshore, we work for a number and we've onboarded a number of those clients and those clients are quite a lot of Western companies in addition to Asia-originated companies who work on an offshore basis by doing a centralized operation, for example, in Malaysia or...
So it's a variety, there's a travel client that is based in the US to cover, to offshore in Colombia for example. So yes, the airline, the regional airline is the one central location in Asia where we are covering all the languages for example. So offshore is still really at the center stage of what we do for the large majority of the world.
If I go to the question correctly.
Got it. Thank you.
Thanks Casey. So let me just read out a couple of questions that we have from the webcast. For the new customer additions that we are getting, are they at the same margin profile or different margin profile from existing customers?
Thank you for that question. There are a variety of margin profiles. We have a very strict band that we apply depending on the strategy that we pursue. In general, the mix of clients on board are meeting our criteria and our financial criteria.
Absolutely, as I was here for, it's quite peachy about that.
Thank you. Next question from Benjamin Ng. Can you share more about which inflation, what colour and how are we managing which inflation?
Do you want to cover it?
I can probably focus in there Mr. Chen. Yes, waste inflation is a factor that is affecting our operation as well. But on the flip side, I think we also...
operating our resources more efficiently than ever before. I think it is a case of cost.
exploration, efficient resources utilization, enhanced productivity on our revenue is still crucial to help buffer against all these cost inflation inflationary factors. And on the flip side, on the non-wage overhead stuff, as you can see, we are also taking some of our own waste as possible in the first half year, thank you on our own.
capacity side of things, actually precision is lower to help address and buffer this, all these major pressure. So in a nutshell, I think this is where these seven leading parts kind of help to...
address our wage education adverse issues.
Thanks, Mr. Chin. Next question from Jill Young. The growth of your top two customers seem to have slowed down. Can you give us any colour on that, please?
we would like to be putting
So, top two clients are, as you know, quite important to us. Our concentration has come down, which is also a good thing. And it's a mixed pack, actually, of situations. We think that one of the environments that is kind of challenging in the digital advertising could very well impact us, but it's also mitigated by...
The fact that we are quite strong in sales and digital marketing and we think, like I said earlier on, that as the digital advertising market is becoming more and more competitive, our clients have quite an appetite for engaging us to do sales and digital marketing. So we see that they're growing quite significantly. So I couldn't possibly call that a slow down, rather a significant increase. So it's probably more of a rebalancing of the nature of the work we do for them.
25% year on year versus 22% in 2020. But it's still behind, actually, the 2019 numbers. It's probably 16% behind what it used to be at its highest. So there's room for growth. Taking into account, again, that Asia is not reopened yet. And you could be benefiting from that possibility. We just don't know.
So, and again, the two clients that we have is things and we have a whole cohort of large clients that are becoming quite mature and they're being put a lot of revenue for us and then a whole new, a group of new logos that are bringing accelerated growth into the mix. So the blend of it all is... Things Continue.
signing off to a quite nice report.
Thank you, Lajon. Next question again from the webcast from Wilson Wong. Any update on the ed convey Alexander?
Hey, Luca and Ed here. Let me take this one. The discussions are still ongoing and we feel really good about where we're going with this. We hope to be able to share some further information with you as soon as possible. Obviously, I think as Lauren just mentioned on the side of that travel is very timely and we're able to...
So that ties with this strategic plan of ours. So still working on it. This is a very last event. I hope to be able to share something with you soon.
Thanks Ed. I think we have time for just one last question. So last question on the line.
Two people asking the same questions actually. Have we been able or are we able to build wage inflation to our new contracts?
Yes, actually we are able to do this and we have some time to have a cost of living adjustment.
But not all. So we cannot every time pass on that cost of living adjustment, but we've been successful in quite a number of situations and occasions. And the suggestion that they're having is actually maybe to take the opportunity of really this crisis to go back again to our clients in a very systematic manner and really ask for this to happen as a matter of protecting their interests, not just our...
If you have any follow-on questions, you can reach out to me after this. I'd just like to all be on management. Thank you for your time. Thank you everyone.
you know you can reach out to us reach out to me after this. I just like to on behalf of management thank you for your time and we are signing off. Thank you everyone. Thank you. Bye.
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