Q4 2024 IBEX Ltd Earnings Call
Operator: Welcome to the Ibex fourth quarter full year 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session.
Welcome to the IMAX fourth quarter full year 2024 earnings conference call. At this time all participants are in a listen only mode. After the speaker's presentation there'll be a question and answer session to ask a question. Please press star one one on your telephone and wait for your name to be announced.
Operator: To ask a question, please press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again.
Speaker Change: To withdraw your question. Please press star one again to note. There is an accompanying earnings deck presentation available on the IBEX Investor Relations website at investors Dot IBEX Darko I will now turn this conference over to Mr. Michael Dar wall head of Investor Relations for IDEXX.
Operator: To note, there is an accompanying earnings deck presentation available on the Ibex Investor Relations website at investors.ibbex.co.
Michael Darwal: I will now turn this conference over to Mr. Michael Darwal, head of investor relations for Ibex. Good afternoon, and thank you for joining us today. Before we begin, I want to remind you that matters discussed on today's call may include forward-looking statements related to our operating performance, financial goals, and business outlook, which are based on management's current beliefs and assumptions. Please note that these forward-looking statements reflect our opinion as of the date of this call, and we undertake no obligation to revise this information as a result of new developments, which may occur. Forward-looking statements are subject to various risks, uncertainties, and other factors that could cause our actual results to differ materially from those expected and described today.
Speaker Change: Good afternoon, and thank you for joining us today before we begin I want to remind you that matters discussed on today's call may include forward looking statements related to our operating performance financial goals and business outlook, which are based on management's current beliefs and assumptions.
Speaker Change: Note that these forward looking statements reflect our opinion as of the date of this call.
Speaker Change: We undertake no obligation to revise this information as a result of new developments, which may occur.
Speaker Change: We're looking statements are subject to various risks uncertainties and other factors that could cause our actual results could differ materially from those expected and described today for a more detailed description of our risk factors. Please review our annual report on Form 10-K filed with the U S Securities and exchange can.
Michael Darwal: For a more detailed description of our risk factors, please review our annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on September 12, 2024.
Speaker Change: Mission on September 12, 2024, with that I will now turn the call over to IMAX CEO Bob jacket.
Bob Decken: With that, I will now turn the call over to Ibex CEO Bob Decken. Thanks, Mike. Good afternoon, everyone. And thank you all for joining us today as we share our fourth quarter in fiscal year 2024 results. FY 24 was another transformative year for Ibex, where we achieved all-time best across a number of key financial metrics, including EPS, net income, EBITDA margin, and free cash flow. We accomplished this in the face of evolving changes across the BPO market with continued macroeconomic pressure and the excitement of generative AI. We continue to demonstrate a unique ability to successfully compete and win against our much larger competitors.
Speaker Change: Thanks, Mike.
Bob jacket: Good afternoon, everyone and thank you all for joining us today, as we share our fourth quarter and fiscal year 'twenty 'twenty four results.
Bob jacket: FY 'twenty four was another transformative year for IMAX, where we achieved all time best across a number of key financial metrics, including Etfs net income.
Bob jacket: EBITA margin and free cash flow.
Bob jacket: We accomplished this in the face of evolving changes across the BPM market.
Speaker Change: With continued macroeconomic pressure.
Speaker Change: And the excitement of generative AI.
Speaker Change: We continued to demonstrate our unique ability to successfully compete and win against a much larger competitors.
Bob Decken: Our competitive advantage remains built around an unparalleled agent-first culture with tremendous employee engagement paired with our Wave IX technology staff, where we are marrying cutting-edge AI solutions and deep analytics. These attributes enable us to consistently outperform our competitors and provide compelling differentiators as we expand our sales pipeline and win new business. We have branded this as taking the Ibex Challenge.
Speaker Change: Our competitive advantage remains built around an unparalleled Egypt first culture with tremendous employee engagement.
Speaker Change: Paired with our wave I X technology stocks, where we are marrying cutting edge AI solutions and deep analytics.
Speaker Change: These attributes enable us to consistently outperform our competitors and provide compelling differentiators as we expand our sales pipeline and win new business.
Speaker Change: We have branded this is taking the IBEX challenge.
Bob Decken: Let me take a moment to highlight some of the key results we delivered in FY 24. We won 18 new client relationships in the fiscal year, primarily with leading retail e-commerce, healthcare, and gaming clients. Up from 10 in the prior year. We achieved record EPS of $2.10, up from $1.96 last year. We continued the growth of our more profitable digital first services that operates primarily in our offshore and near shore locations, delivering 77% of revenue in the fourth quarter. Up from 74% a year ago in these regions. We delivered record free cash flow of 27 million versus 22.9 million in the prior year, and we ended the year with 61.2 million in net cash.
Speaker Change: Let me take a moment to highlight some of the key results we delivered in FY 'twenty four.
Speaker Change: We won 18, new client relationships and the fiscal year, primarily with leading retail e-commerce healthcare and gaming clients up from 10 in the prior year.
Speaker Change: We achieved record EPS of $2.10.
Up from $1 96 last year.
We continued the growth of our more profitable digital first services that operates primarily in our offshore and nearshore locations.
Speaker Change: Delivering 77% of revenue in the fourth quarter.
Speaker Change: From 74% a year ago in these regions.
Speaker Change: We delivered record free cash flow of $27 million versus $22 9 million in the prior year.
Speaker Change: And we ended the year with $61 2 million in net cash.
Bob Decken: We deployed our capital to repurchase 1.3 million shares at a cost of 21.7 million, reducing our shares outstanding by 8%. Although revenue was down slightly at 2.8% year over year to 509 million, we were up slightly in Q4 year over year, which we review as an inflection point heading into fiscal year 2025.
Speaker Change: We deployed our capital to repurchase one 3 million shares at a cost of $21 7 million.
Speaker Change: Reducing our shares outstanding by 8%.
Speaker Change: Although revenue was down slightly at two 8% year over year to $509 million.
We were up slightly in Q4 year over year, which we view as an inflection point heading into fiscal year 2025.
Bob Decken: Looking back several years ago, we undertook a strategic journey of transforming Ibex into a differentiated digital-first company. We called this BPO 2.0. In August of 2020, we IPO the company built around this strategy. Since then, we have made tremendous progress as a company. In FY20, Ibex had revenues of 405 million, while adjusted EBITDA margins were below 10%. In the four-year sense, we have organically grown revenue more than 100 million or over 25%. Expanded adjusted EBITDA, more than 25 million or 65%. Improved adjusted EBITDA margins 310 basis points, retired virtually all of our debt on our balance sheet.
Speaker Change: Looking back.
Speaker Change: Several years ago, we undertook a strategic journey of transforming <unk> into differentiated digital first company.
Speaker Change: We call this <unk> two point, though.
Speaker Change: And in August of 2020.
Speaker Change: IPO the company built around this strategy.
Speaker Change: Since then we have made tremendous progress as a company.
Speaker Change: In FY 'twenty.
Speaker Change: <unk> had revenues of $405 million, while adjusted EBITDA margins were below 10%.
In the four years since we have organically grown revenue more than 100 billion or over 25%.
Speaker Change: Expanded adjusted EBITDA more than $25 million or 65% improved.
Speaker Change: Improved adjusted EBITDA margins 310 basis points.
Speaker Change: Retired virtually all of our debt on our balance sheet.
Bob Decken: Continued to build an NVS net cash position, built one of the finest rosters of clients in the industry, and transformed our business to nearly 80% integrated on the channel digital first from 65%. And in FY24, we continued the evolution and further strengthening of our business by launching our suite of AI services, which we believe will continue to set our trajectory up and to the right. This momentum carried right into our fourth quarter and into FY25. Our Q4 was another strong quarter. Our BPO 2.0 clients grew at 3%. And now represent 81% of our overall revenue, up from 79% in Q4 FY23.
Speaker Change: Continued to build an envious net cash position.
Speaker Change: One of the finest rosters of clients in the industry and transformed our business to nearly 80% integrated Omnichannel digital first from 65%.
Speaker Change: And in FY 'twenty four we continued the evolution and further strengthening of our business by launching our suite of AI services, which we believe will continue to set our trajectory up and to the right.
This momentum carried right into our fourth quarter and into FY 'twenty five.
Speaker Change: Our Q4 was another strong quarter.
Speaker Change: <unk> 2.0 clients grew at 3%.
Speaker Change: Now represent 81% of our overall revenue.
Speaker Change: Up from 79% in Q4, FY2023.
Bob Decken: Revenues in our highly profitable offshore and near-shore regions grew at 4% and now represent 77% of our overall business. As a result, EBITDA grew a healthy 16% versus prior year quarter to 17.9 million, with a margin of 14.4%, up 200 basis points. We believe we hit an inflection point to returning to top line growth, with revenues slightly ahead of prior year.
Speaker Change: Revenues in our highly profitable offshore and nearshore regions grew at 4% and now represent 77% of our overall business.
Speaker Change: As a result, EBITDA grew a healthy 16% versus prior year quarter to $17 9 million with a margin of 14, 4% up 200 basis points.
Speaker Change: We believe we hit an inflection point.
Speaker Change: Returning to topline growth with revenue slightly ahead of prior year.
Bob Decken: I am excited to report that we ended the quarter winning our first significant customer-facing AI deal, which will provide a new revenue stream for Ibex. At the core of Ibex remains our powerful new logo engine, where we continue to win high-profile deals against strong competition. As indicated, we won 18 new client deals, nearly double that of the prior year. Our ability to win spans across strategic verticals and geographies. As an example, in the gaming industry, a stronghold for several of our competitors, we had our first major win in Q4, winning and launching with one of the world's largest video game companies, providing technical support and account services from one of our near-shore markets, with a fast follow expected in a new geography in early FY25.
Speaker Change: I am excited to report that we ended the quarter, winning our first significant customer facing AI deal, which will provide a new revenue stream for IMAX.
Speaker Change: At the core of buybacks remains our powerful new logo engine, where we continue to win high profile deals against strong competition.
Speaker Change: As indicated we won 18, new client deals nearly double that of the prior year.
Speaker Change: Our ability to win spans across strategic verticals and geographies.
Speaker Change: As an example in the gaming industry.
Speaker Change: Stronghold for several of our competitors, we had our first major win in Q4, winning in launching with one of the world's largest video game companies, providing technical support and account services from one of our nearshore markets with a fast follow expected in a new geography.
Speaker Change: Early FY 'twenty five.
Bob Decken: This win presents an exciting opportunity for Ibex to grow and take share from legacy competitors in this vertical, much as we have done in recent years in the healthcare space. Additionally, our sales engine was able to win a very large deal servicing the Australia, New Zealand, and Singapore regions for a Fortune 500, displacing a large Australian competitor while beating out a multi-billion-dollar competitor that has a large presence in the ANZM market. In June, we won our first significant customer-facing AI opportunity with a major mobile carrier. We are delivering our AI-automate call automation solution where we are providing chat and voice-pots for high-volume, low-complexity call types that will complement our live-age and support and provide us an additional stream of revenue.
Speaker Change: This win presents an exciting opportunity for IMAX to grow and take share from legacy competitors in this vertical.
Speaker Change: Much as we have done in recent years in the healthcare space.
Speaker Change: Additionally, our sales engine was able to win a very large deal servicing the Australia, New Zealand and Singapore regions for a fortune 500 display.
Speaker Change: Displacing a large Australian competitor, while beating out a multibillion dollar competitor that has a large presence in the <unk> market.
Speaker Change: In June one.
Speaker Change: Our first significant customer facing AI opportunity with a major mobile carrier.
Speaker Change: We are delivering our AI automate call automation solution.
Speaker Change: Where we are providing chat and voice spots for high volume low complexity call types that will complement our live agent support and provide us an additional stream of revenue.
Bob Decken: These examples are great proof points in our ability to win on the big stage with great clients against our bigger competition. It is these types of solutions that give us tremendous momentum entering FY 25.
Speaker Change: These examples are great proof points in our ability to win on the big stage with great clients against our bigger competition it.
Speaker Change: It is these types of solutions that gives us tremendous momentum entering FY 'twenty five.
Bob Decken: Our ability to consistently drive great optional excellence starts with our agents and their passion for working for Ibex and supporting our great client brands. We are extremely proud of the culture we have built, especially for our incredible agents who are the fabric of Ibex. I am excited to report that our employee Net Promoter Score reached a new high of 77, up nine points from the prior year. We believe this is one of the highest in the industry. It is a testament to our commitment we all have at Ibex to create the best employee engagement in the industry.
Speaker Change: Our ability to consistently drive optional excellence starts with our agents and their passion for working for IMAX and supporting our great client brands.
Speaker Change: We are extremely proud of the culture, we have built especially for our incredible agents, who are the fabric of buybacks.
Speaker Change: I am excited to report that our employee net promoter score reached a new high of 77.
Speaker Change: Up nine points from the prior year.
Speaker Change: We believe this is one of the highest in the industry.
Speaker Change: It is a testament to our commitment we all have an IMAX to create the best employee engagement in the industry.
Bob Decken: This, in turn, positions us incredibly well to outperform our competition and execute our land and expand strategy, where we grow our market share. A great example of this is a highly strategic win with one of our top five clients, whom we already service in five geographies, to expand into a sixth geography. This represents a brand new offshore market for them and a huge opportunity for Ibex in the coming years. Our track record of excellent performance, employee engagement, and the client's trust in Ibex all contributed greatly to what we believe will be a highly impactful long-term win.
Speaker Change: This in turn positions us incredibly well to outperform our competition and execute our land and expand strategy, where we grow our market share.
A great example of this is a highly strategic win with one of our top five clients, whom we already service in five geographies to expand into a sixth geography.
Speaker Change: This represents a brand new offshore market for them and a huge opportunity for IMAX in the coming years, our track record of excellent performance employee engagement and the clients' trust in IMAX all contributed greatly to what we believe will be a highly impactful long term.
Bob Decken: Our award-winning Webex customer-facing solutions, AI automate, AI translate, and AI authenticate are positioning us as a first mover where we are front and center with our clients developing chat and voice spots to automate contacts. In addition to our recent win, we now have a pipeline of over 40 AI opportunities where we are continuing to get tremendous feedback from our clients that we are further along than any of our competitors in developing and taking to market these types of solutions. Being first to market also strengthens our relationship as a trusted partner. The traction we have and our speed to aggressively market these services provides exciting near-term and mid-term opportunities to create meaningful new revenue streams and growth opportunities for Ibex.
Speaker Change: <unk>.
Speaker Change: Our award winning wave IX customer facing solutions.
Speaker Change: AIA automate AI translate and AI authenticate are positioning us as a first mover.
Speaker Change: Where we are front and center with our clients developing chat and voice spots to automate contacts.
Speaker Change: In addition to our recent win we now have a pipeline of over 40, AI opportunities, where we are continuing to get tremendous feedback from our clients that we are further along than any of our competitors and developing and taking to market. These types of solutions.
Speaker Change: Being first to market also strengthens our relationship as a trusted partner.
Speaker Change: The traction we have and our speed to aggressively market. These services provides exciting near term and mid term opportunities to create meaningful new revenue streams and growth opportunities for IMAX.
Bob Decken: We continue to make important investments into our long-term strength and capabilities of the company beyond our AI initiatives. As an example, last summer we began the upgrade of our legacy ERP and HCM systems to an integrated Workday solution, and we are now nearing the completion. A testament to the talent of our leadership. We believe that this investment will strengthen our ability to run this business even more efficiently and at even larger scale. From a capital allocation standpoint, our strong financial position and balance sheet enabled us to execute on our share repurchase program while still achieving a record year for cash flows and make the aforementioned investments.
Speaker Change: We continue to make important investments into our long term strength.
Speaker Change: And capabilities of the company beyond our AI initiatives.
Speaker Change: As an example last summer we began the upgrade of our legacy ERP and HCM systems to an integrated.
Speaker Change: Weighted workday solution.
And we are now nearing the completion of.
Speaker Change: Testament to the talent of our leadership.
Speaker Change: We believe that this investment will strengthen our ability to run this business even more efficiently.
Speaker Change: And that even larger scale.
Speaker Change: From a capital allocation standpoint.
Speaker Change: Our strong financial position and balance sheet enabled us to execute on our share repurchase program.
Speaker Change: While still achieving record year for cash flows and make the aforementioned investments.
Bob Decken: Further, it is enabling us to selectively evaluate M&A opportunities as a way to enhance both our solutions and our competitive mode, as well as accelerate our growth. Additionally, we will continue to selectively deploy capital expenditures in support of market growth in our off and near-shore regions, as we have utilized much of the expanded capacity built out over the COVID-19 pandemic period.
Speaker Change: Further it is enabling us to selectively evaluate M&A opportunities as a way to enhance both our solutions and our competitive moat as well as accelerate our growth. Additionally.
Speaker Change: Additionally, we will continue to selectively deploy capital expenditures in support of market growth in our off and nearshore regions. As we have utilized much of the expanded capacity built out over the COVID-19 pandemic period.
Bob Decken: In summary, we are excited with the trajectory as we enter FY25. We believe the business is positioned for a return to growth, continued strong EPS and free cash flow, and one where we are ahead of the competition from an AI perspective. Our ability to win big with high profile brands is the staple of Ibex. We expect this to continue into FY25 and beyond.
Speaker Change: In summary, we are excited with the trajectory as we enter FY 'twenty five.
Speaker Change: We believe the business is positioned for a return to growth.
Speaker Change: <unk> strong EPS and free cash flow.
Speaker Change: And one where we are ahead of the competition from an AI perspective.
Speaker Change: Our ability to win big with high profile brands as the staple of IMAX.
Speaker Change: We expect this to continue into FY 'twenty five and beyond.
Taylor Greenwald: With that, I will now turn the call over to Taylor to go in more details on our 24 financials and guidance for FY25. Taylor? Thank you, Bob, and good afternoon, everyone. Thank you for joining the call today. In my discussions of our fourth quarter and fiscal year 2024 financial results, references to revenue, net income, and net cash generated from operations are on a US GAAP basis while adjusting that income, adjusted earnings per share, adjusted EBITDA, and free cash flow are on a non-GAAP basis. Reconciliation of our US GAAP to non-GAAP measures are included in the table attached to our earnings press release.
Speaker Change: With that I will now turn the call over to Taylor to go in more detail on our 'twenty for financials and guidance for FY 'twenty five.
Speaker Change: Taylor.
Taylor: Thank you Bob and good afternoon, everyone.
Taylor: Thank you for joining the call today.
Taylor: In my discussions of our fourth quarter and fiscal year 2024 financial results references to revenue net income and net cash generated from operations are on a U S. GAAP basis, while adjusted net income adjusted earnings per share adjusted EBITDA and free cash flow are on a non-GAAP basis reckon.
Speaker Change: Reconciliations of our U S. GAAP to non-GAAP measures are included in the table attached to our earnings press release.
Taylor Greenwald: Turning to our results, our fourth quarter results are among the strongest in our history. Fourth quarter revenue increased slightly from prior year to $124.5 million, and we achieved record fourth quarter, adjusted EBITDA, net income, and EPS results. Revenue growth driven by our higher margin regions offset by lower onto a revenue as we successfully grew several of our strategic verticals. Our focus efforts to grow our higher margin near short and offshore delivery locations are having a favorable impact on bottom line results. Offshore near-shore revenues now comprised 77% of total revenue versus 74% in the prior year quarter.
Speaker Change: Turning to our results our fourth quarter results are among the strongest in our history.
Speaker Change: Fourth quarter revenue increased slightly from prior year to $124 5 million and we achieved record fourth quarter adjusted EBITDA net income and EPS results.
Speaker Change: Revenue growth driven by our higher margin regions offset by lower onshore revenue as we successfully grew several of our strategic verticals.
Our focused efforts to grow our higher margin nearshore and offshore delivery locations are having a favorable impact on bottom line results.
Speaker Change: Offshore nearshore revenues now comprised 77% of total revenue versus 74% in the prior year quarter.
Taylor Greenwald: Our lower margin onshore region decreased to 23% of total revenue versus 26% in the prior year quarter. Revenue makes continued to grow in our higher margin, digital, and omnichannel services as well. Digital and omnichannel delivery now represents 77% of our total revenue versus 75% in the fourth quarter a year ago. We expect that we will continue to be successful driving growth in these higher margin services. As Bob mentioned, we are seeing our pipeline, particularly in the higher margin services, strengthen, leading to an acceleration of new client wins. Fourth quarter net income increased to 9.8 million, but 4.5 million in the prior year quarter.
Speaker Change: Our lower margin onshore region decreased to 23% of total revenue versus 26% in the prior year quarter.
Revenue mix continued to grow at a higher margin digital and Omnichannel services as well.
Speaker Change: Digital and Omnichannel delivery now represents 77% of our total revenue versus 75% in the fourth quarter a year ago.
Speaker Change: We expect that we will continue to be successful driving growth in these higher margin services.
Speaker Change: As Bob mentioned, we are seeing our pipeline, particularly in the higher margin services strengthen leading to an acceleration of new client wins.
Fourth quarter net income increased to $9 8 million up $4 5 million in the prior year quarter. The increase was primarily driven by the sight and cost optimization efforts completed over the past year. The continued growth of work and higher margin offshore locations during fiscal year, 2024, and lower income tax expense.
Taylor Greenwald: The increase was primarily driven by the site and cost optimization efforts completed over the past year. The continued growth of work and higher margin offshore locations during fiscal year 2024 and lower income tax expense. Fully diluted EPS was 56 cents, up over 100% from 24 cents in the prior year quarter. Contributing to the EPS growth was the impact from fewer diluted shares outstanding as a result of our ongoing share repurchase program. Diluted shares to the quarter were 17.6 million versus 19 million one year ago. Moving to non-GAAP measures, adjusted EBITDA increase to 17.9 million or 14.4% of revenue from 15.4 million or 12.4% of revenue for the same period last year.
Speaker Change: Fully diluted EPS was 50 success up over 100% from 24, the prior year quarter.
Speaker Change: Contributing to the EPS growth was the impact from fewer diluted shares outstanding as a result of our ongoing share repurchase program.
Speaker Change: Diluted shares for the quarter were $17 6 million versus 19 million one year ago.
Speaker Change: Moving to non-GAAP measures adjusted EBITDA increased to $17 9 million or 14, 4% of revenue from $15 4 million or 12, 4% of revenue for the same period last year.
Taylor Greenwald: The 200 basis point improvement in adjusted EBITDA margin was primarily driven by the site and cost optimization efforts completed over the past year and the growth of work in our higher margin offshore locations during fiscal year 2024. Adjusted that income increased to 10.2 million from 6.2 million in the prior year quarter. Non-GAAP fully alluded adjusted earnings per share increased to 58 cents from 33 cents in the prior year quarter. The increases were driven by the higher EBITDA, as well as lower taxes and fewer diluted shares outstanding due to our ongoing share repurchase program. As a company, we're pleased with the client diversification we've established over the last several years.
Speaker Change: 200 basis point improvement in adjusted EBITDA margin was primarily driven by the sight and cost optimization efforts completed over the past year and the growth of work in our higher margin offshore locations during fiscal year 2024.
Speaker Change: Adjusted net income increased to $10 2 million from $6 2 million in the prior year quarter non-GAAP fully diluted adjusted earnings per share increased to 58% from 33 in the prior year quarter.
Speaker Change: The increases were driven by the higher EBITDA as well lower taxes and fewer diluted shares outstanding due to our ongoing share repurchase program.
Speaker Change: As a company we're pleased with the client diversification, we've established over the last several years for the fourth quarter of fiscal year 2024, our largest client accounted for 12% of revenue and our top five top 10, and top 25 client concentration declined slightly compared to the prior year to 36.
Taylor Greenwald: For the fourth quarter of fiscal year 2024, our largest client accounting for 12% of revenue and our top five, top 10, and top 25 client concentrations to client slightly compared to the prior year to 36%, 52%, and 78%, respectively, of overall revenue, representative of a well diversified client portfolio. In addition, we ended the fiscal year with 55 clients billing at over 1 million per annum and 27 clients billing at over 5 million per annum. Both consistent with prior year, exemplify the success of our ability to service large material clients across vertical industries and geographies. We service these top clients on average across 2.3 geographies while having significant opportunities to further expand our footprint and lines of business with clients.
52% and 78% respectively of overall revenue representative of a well diversified client portfolio.
Speaker Change: In addition, we ended the fiscal year with 55 clients billing at over $1 million per annum in 27 clients billing at over $5 million per annum.
Speaker Change: Both consistent with prior year exemplifies the success of our ability to service large material clients across vertical industries and geographies.
We service these top clients on average across two three geographies, while having significant opportunities to further expand our footprint and lines of business with clients.
Taylor Greenwald: Switching to our verticals, retail and e-commerce increased to 24% of fourth quarter revenue versus 22.3% in the prior year quarter, driven by continued growth in multiple offshore geographies and our continued ability to win significant new clients in this vertical. Health tech increased to 13.9% from 13.5%, and traveled transportation and logistics increased to 14.8% of fourth quarter revenue versus 12.4% in the prior year quarter. Conversely, our exposure to teleview occasions vertical decreased to 14.5% of quarterly revenue versus 15.1% in the prior year quarter. Additionally, thin tech decreased to 13.7% of revenue for the quarter versus 16.5% in the prior year quarter, impacted by the changing landscape for some client payment support models and geographic shifts from onshore to offshore delivery.
Speaker Change: Switching to our verticals retail and e-commerce increased to 24% of fourth quarter revenue versus 22, 3% in the prior year quarter, driven by continued growth in multiple offshore geographies and our continued ability to win significant new clients in this vertical.
Speaker Change: <unk> increased to 13, 9% from 13, 5% and travel transportation and logistics increased to 14, 8% of fourth quarter revenue versus 12, 4% in the prior year quarter.
Speaker Change: Conversely, our exposure in telecommunications vertical decreased to 14, 5% of quarterly revenue versus 15, 1% in the prior year quarter.
Speaker Change: Additionally, fintech decreased to 13, 7% of revenue for the quarter versus 16, 5% in the prior year quarter impacted by the changing landscape for some client payments support models and geographic shift from onshore to offshore delivery.
Taylor Greenwald: Moving on to our fiscal year 2024 results, revenue decreased 2.8% to 508.6 million compared to 523.1 million in the prior year, largely due to the year-over-year migration of delivery from onshore to higher margin offshore regions, macroeconomic conditions providing headwinds, particularly in the first half of the year, and external factors impacting the thin tech and telecommunication verticals, partially offset by growth in the retail and e-commerce, health tech, and travel, transportation, and logistic verticals. The strength of our 18 new client wins across all our key verticals partially offset the above headwinds and position us for a return to growth in fiscal year 2025.
Speaker Change: Moving onto our fiscal year 2024 results revenue decreased two 8% to $508 6 million compared to $523 1 million in the prior year largely due to the year over year migration of delivery from onshore the higher margin offshore regions macroeconomic conditions, providing head.
Speaker Change: Particularly in the first half of the year and external factors impacting the fintech and telecommunication verticals, partially offset by growth in the retail and E Commerce health Tech and travel transportation and logistic verticals.
The strength of our 18, new client wins across all our key vehicles, partially offset the headwinds and position us for a return to growth in fiscal year 2025.
Taylor Greenwald: Similar to the fourth quarter, the growth of delivery in our higher margin near short and offshore regions throughout the year had a meaningful impact on revenue, as onshore revenues, which comprise 24% of our total revenues during the fiscal year, declined 16%, and near short offshore revenues, which comprise 76% of our total revenues, increased to 1.5% versus the prior year, with the growth going particularly in our offshore region. The macroeconomic headwind which I mentioned earlier contributed to longer client sales cycles and impacted near-term revenue growth and had a more prominent impact during the first half of the fiscal year.
Speaker Change: Similar to the fourth quarter the growth of delivery in our higher margin nearshore and offshore regions throughout the year had a meaningful impact on revenue is onshore revenues, which comprised 24% of our total revenues during the fiscal year.
Speaker Change: Slide, 16% and nearshore and offshore revenues, which comprised 76% of our total revenues increased two 5% versus the prior year with the growth can be particularly in our offshore region.
Speaker Change: The macroeconomic headwinds, which I mentioned earlier contributed to longer client sales cycles and impacted near term revenue growth and had a more prominent impact during the first half of the fiscal year.
Taylor Greenwald: Fiscal year 2024, net income increased to 33.7 million versus 31.6 million in the prior year. The increase was driven by higher gross margins, higher interest income, and lower taxes. The increase in interest income is due to higher income from invested funds. The decrease in tax expense was due to a lower effective tax rate in the current year compared to the prior year, which was primarily attributable to changes in the revenue mix across our taxable jurisdictions and discrete items recorded in the prior year. Our tax rate for fiscal year 2024 was 18% compared to 22%. As we move into fiscal year 2025, we expect our tax rate to be slightly over 20%.
Speaker Change: Fiscal year 2024, net income increase of $33 7 million versus $31 6 million in the prior year.
Speaker Change: The increase was driven by higher gross margins higher interest income and lower taxes.
Speaker Change: The increase in interest income is due to higher income from invested funds.
The decrease in tax expense was due to a lower effective tax rate in the current year compared to prior year, which was primarily attributable to changes in the revenue mix across our taxable jurisdictions.
Speaker Change: And discrete items recorded in the prior year.
Speaker Change: Our tax rate for fiscal year, 2024 was 18% compared to 22%.
Speaker Change: As we move into fiscal year 2025, we expect our tax rate to be slightly over 20%.
Taylor Greenwald: Moving to non-GAAP measures for the full year, adjusted EBITDA decreased to 65.2 million or 12.8% of revenue compared to 66.6 million or 12.7% of revenue for the prior year. Despite the aforementioned factors impacting our historical growth trends, adjusted EBITDA margin increased slightly, primarily due to the site optimization efforts completed over the past year and the migration of clients to hire margin offshore locations. Adjusted net income increased 4% to 38.4 million compared to 36.9 million in the prior year. Non-GAAP fully deluded adjusted earnings per share increased 7.1% to $2.00 compared to $1.96. The increase in adjusted net income and non-GAAP fully diluted adjusted earnings per share was driven by improved gross margins, increased interest income, and lower income tax expense.
Speaker Change: Moving to non-GAAP measures for the full year adjusted EBITDA decreased to $65 2 million or 12, 8% of revenue compared to $66 6 million or 12, 7% of revenue for the prior year.
Speaker Change: Spiked the aforementioned factors impacting our historical growth trends adjusted EBITDA margin increased slightly primarily due to the site optimization efforts completed over the past year and the migration of clients to higher margin offshore locations.
Speaker Change: Adjusted net income increased 4% to $38 4 million compared to $36 9 million in the prior year.
Speaker Change: non-GAAP fully diluted adjusted earnings per share increased seven 1% to $2 10%.
Speaker Change: Compared to $1 96 inch.
Speaker Change: The increase in adjusted net income and non-GAAP fully diluted adjusted earnings per share was driven by improved gross margins increased interest income and lower income tax expense EPS.
Taylor Greenwald: EPS also benefited from the lower share count due to our repurchase program. Net cash generated from operating activities was 35.9 million per fiscal year 2024 compared to 41.9 million per fiscal year 2023. The decrease in net cash in love from operating activities was primarily due to a high use of working capital. Our DSOs were 72 days, up from 63 days at the end of last year and in line with industry average. DSOs increased this year as an early paid discount was ended with one of our larger clients early in the fiscal year in the fourth quarter end for the full year ended on a Sunday.
Speaker Change: EPS also benefited from a lower share count due to our repurchase program.
Speaker Change: Net cash generated from operating activities was $35 9 million for fiscal year 2024, compared to $41 9 million for fiscal year 2023.
Speaker Change: The decrease in net cash inflow from operating activities was primarily due to a high use of working capital.
Speaker Change: Our Dsos were 72 days up from 63 days at the end of last year and in line with industry average.
Speaker Change: Dsos increased this year as an early pay discount was ended with one of our larger clients earlier fiscal year.
In the fourth quarter and for the full year ended on a Sunday, we expect our DSO to remain stable on a go forward basis.
Taylor Greenwald: We expect our DSOs remain stable on a bill for basis. Capital expenditures were 8.9 million or 1.7% revenue for fiscal year 2024 versus 19 million or 3.6% revenue in the prior year. As we continue to utilize our available capacity from buildouts completed in previous years. Free cash load improved to a record 27 million in the current year, up from 22.9 million in the prior year. The increase is due to decreased capital expenditures during the fiscal year end of June 30, 2024. As we utilized capacity built out over the last two years, partially offset by a decrease in net cash in love from operating activities due to the higher DSOs.
Capital expenditures were $8 9 million or one 7% of revenue for fiscal year 2024 versus $19 million or three 6% of revenue in the prior year as we continued to utilize our available capacity from build outs completed in previous years.
Speaker Change: Free cash flow improved to a record $27 million in the current year up from $22 9 million in the prior year. The increase is due to decreased capital expenditures during the fiscal year ended June 32024, and.
Speaker Change: And we utilized capacity built out over the last few years, partially offset by a decrease in net cash inflow from operating activities due to the higher DSO.
Taylor Greenwald: So we ended the fourth quarter with 62.7 million cash, up from 57.4 million as of June 2023. Net cash was 61.2 million, up from 56.4 million as of June 2023. The increases in cash and net cash were due to our record free cash low, partially offset by a significant increase in share repurchase activity. For fiscal year 2024, we repurchased over 1.3 million shares, or roughly 8% of our outstanding shares, for 21.7 million, of which 197,000 shares were purchased in the fourth quarter for 3.1 million. We have 27 million remaining to repurchase under our current share repurchase program, which was approved on May 1, 2024.
Speaker Change: We ended the fourth quarter was $62 7 million in cash up from $57 4 million as of June 2023.
Speaker Change: Net cash was $61 2 million up from $56 4 million as of June 2023.
The increases in cash and net cash were due to our record free cash flow, partially offset by a significant increase in share repurchase activity for.
Speaker Change: For fiscal year 2024, we repurchased over one 3 million shares or roughly 8% of our outstanding shares.
Speaker Change: $21 7 million of which 197000 shares were purchased in the fourth quarter for $3 1 million.
Speaker Change: We have $27 million remaining to repurchase under our current share repurchase program, which was approved on May one 2024.
Taylor Greenwald: To summarize, our 2024 fiscal year are intentional pivot toward digital purse services several years ago continue to drive record financial results enabled by the ongoing growth of these high margin services and geographies. We're seeing operating performance improvement across all our regions. In the last half of fiscal year 2024, we delivered an adjusted EBITDA margin of 14.8%, placing Ibex among the top performers in our industry. Our record year of generating free cash low has put us into an ideal position to continue to invest in our infrastructure, advanced AI capabilities, and our sales and marketing to accelerate future revenue growth.
Speaker Change: To summarize our 2020 for fiscal year, our intentional pivot towards digital first services. Several years ago continues to drive record financial results enabled by the ongoing growth of these high margin services and geographies we're.
Speaker Change: We're seeing operating performance improvement across all our regions.
Speaker Change: Last half of fiscal year 2024, we delivered an adjusted EBITDA margin of 14, 8% placed in IMAX among the top performers in our industry.
Speaker Change: Our record year of generating free cash flow has put us into an ideal position to continue to invest in our infrastructure advanced AI capabilities in our sales and marketing to accelerate future revenue growth and.
Taylor Greenwald: Importantly, it has also enabled us to execute meaningful share repurchases representing approximately 8% of our shares outstanding to return value to our shareholders. Review this most recent quarter as an inflection point for return to top line growth. We remain confident in the trajectory of our business.
Speaker Change: Importantly, it has also enabled us to execute meaningful share repurchases, representing approximately 8% of our shares outstanding to return value to our shareholders.
Speaker Change: We view this most recent quarter as an inflection point for a return to topline growth.
Speaker Change: We remain confident in the trajectory of our business.
Taylor Greenwald: Looking ahead to fiscal year 2025, revenue is expected to be in the range of 510 to 525 million. Adjusted EBITDA is expected to be in the range of 67 to 69 million. For the first quarter fiscal year 2025, revenue is expected to be in the range of 124 to 126 million. Adjusted EBITDA is expected to be in the range of 14.5 to 15.5 million. Capital expenditures of the year are expected to be in the range of 15 to 20 million. Our business is well positioned for today in the years ahead, and we're excited about the future Vibex as we head in the fiscal year 2025 and beyond.
Looking ahead to fiscal year 2025.
Revenue is expected to be in the range of $510 million to $525 million.
Speaker Change: Adjusted EBITDA is expected to be in the range of $67 million to $69 million.
Speaker Change: For the first.
Speaker Change: <unk> fiscal year 2025 revenue is expected to be in the range of $124 million to $126 million adjusted.
Speaker Change: Adjusted EBITDA is expected to be in the range of 14, five to $15 5 million.
Capital expenditures for the year are expected to be in the range of $15 million to $20 million.
Speaker Change: Our business is well positioned for today and the years ahead, and we're excited about the future buybacks as we head into fiscal year 2025 and beyond.
Operator: With that, Bob and I will now take questions. Operator, please open the line. Thank you.
Speaker Change: With that Bob and I will now take questions.
Speaker Change: Operator, please open the line.
Operator: As a reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again.
Thank you as a reminder to ask a question. Please press star one one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.
David Coney: Our first question comes from David Coney with Baird. You may proceed. Yeah. Hey guys, nice, nice job getting back to what seems like more normalized sequential patterns to revenue and really good margins.
Speaker Change: Our first question comes from David Koning with Baird You May proceed.
David Koning: Yeah, Hey, guys nice nice job getting back to what seems like more normalized sequential patterns to revenue and really good margins.
David Coney: Yeah, thanks, Dave. We were really proud of what the team did this back half of the year and in particular Q4. Yeah, yeah, well, and I guess, you know, when we put in perspective, like guidance is still a little below kind of normal trends in, you know, I assume that's mostly macro driven. I'm kind of wondering, like if we kind of think of three buckets, you kind of have the macro environment; like how are you kind of looking at that relative to kind of normal market share, how are you seeing yourself in terms of market share.
Yeah. Thanks, Thanks, Dave Yeah, we were really proud of what the team did this back half of the year and in particular Q4.
David Koning: Yeah, Yeah well.
Speaker Change: Yes, when we put in perspective like guidance guidance is still a little below kind of normal trends in.
Speaker Change: I assume that's mostly macro driven.
I'm kind of wondering like if you kind of think of three buckets, you're kind of at the macro environment. How are you kind of looking at that.
Speaker Change: Relative to kind of normal market share how are you seeing yourself in terms of market share and then how do you see Gen AI and you put those three together to drive kind of your forecast I assume but can you kind of just go through each of those buckets and how that's affecting your forecast.
Bob Decken: And then how do you see Gen AI, and you put those three together to drive kind of your forecast? I assume, but can you kind of just go through each of those buckets and how that's affecting your forecast. Sure, Dave, and in addition, you know, I think you nailed it, but there's probably one other variable; that variable would be the new logo engine, you know, which is a key driver for us. But when I think of the macro in the second half of the year, I think we started seeing. Volume, starting to move a little bit up, you know, up and to the right, which was encouraging for us.
Speaker Change: Sure Dave.
Speaker Change: In addition, I think.
Speaker Change: You nailed it but there's probably one other variable that variable would be the new logo engine.
Speaker Change: Which is which is a key driver for us, but when I think of the macro.
Speaker Change: In the second half of the year I think we started seeing.
Speaker Change: Volumes, starting to move a little bit up up into the right, which which was which was encouraging for US now if you recall we were.
Bob Decken: Now, if you recall, we, you know, we built this big part of our business 80% of our BPO 2.0 clients, digital first, etc. When we did the analysis, those, those, that part of our business is continuing to grow and has been growing, you know, and it's been offset by, you know, still some shrinking with some of the legacy clients that's now a small part of our business, but, you know, that that's where the shrinkage has really come as we look that year. And so as we look at 25, we feel that that telco element will flatten out a bit. This past year, one of our key clients lost a big NFL contract.
Speaker Change: <unk> built this big.
Speaker Change: Part of our business, 80% of our <unk> 2.0 clients digital first et cetera when.
Speaker Change: When we did the analysis those those that part of our business is continuing to grow and has been growing.
Speaker Change: And it's been offset by still some shrinking with some of the legacy clients that now a small part of our business but.
Speaker Change: But.
Speaker Change: That's where the shrinkage has really come as we looked at Europe, and so as we look at.
Speaker Change: 25.
Speaker Change: We feel that.
Speaker Change: That telco.
Speaker Change: Element will flatten out a bit.
Speaker Change: This past year, one of our key clients lost a big NFL contract and so that caused some subscriber churn and some volumes down. So we think that we have a good handle of the.
Bob Decken: And so that caused some subscriber turn and some volumes, you know, down. So we think that we have a good handle of the, you know, kind of the, the base and the macro and we feel, you know, relatively, you know, conservatively confident that, you know, we have good visibility and that will have a little bit of growth to that. So, so, so, you know, we're excited about that.
Speaker Change: Kind of the base and the macro and we feel.
Speaker Change: Relatively conservatively confident that we have good visibility and that will have a little bit of growth to that.
Speaker Change: So.
Speaker Change: So we're excited about that the second element is you've touched on is market share.
Bob Decken: The second element, as you touched on, is market share. The performance that we have inside our base is outstanding, which is giving our team a hunting license to go leverage that. I shared that big when we had with one of our largest clients, you know, into a completely new geography that they've never been in. And that was driven by the confidence they have in our ability to go execute for them in new markets. And that's one example of what we're seeing. So I feel, you know, I feel really good about that.
Speaker Change: The performance that we have inside our base is outstanding which is giving our team.
Speaker Change: A hunting license to go leverage that I shared that big win we had with one of our largest clients.
Speaker Change: Into a completely new geography that they've never been in.
Speaker Change: And that was driven by the confidence they have in our ability to go execute for them in new markets.
Speaker Change: And.
Speaker Change: That's one example of what we're seeing so I feel I feel really good about that.
Bob Decken: And then the, you know, kind of that new logo engine to me is, you know, is one of those areas that, you know, has always been a strength of Ivex. We saw in this really throughout the course of the whole fiscal year. Our ability to win, execute, and win really, really strong brands, and that the win I want to, you know, highlight it that we had in Q4. Of a major gaming client. Look, we went there; several of our competitors, that’s their core of their business. And we went ahead, you know, head to head against them in one, and that's something that you're just really proud of.
Speaker Change: And then the kind of that new logo engine to me is is one of those areas that.
Speaker Change: You know has always been a strength of IBEX.
Speaker Change: We saw this really throughout the course of the whole fiscal year, our ability to win execute and win really really strong brands in the when I highlighted that we had in Q4.
Speaker Change: A major gaming client look we went there are several of our competitors that's their core of their business and we went head.
Speaker Change: No head to head against them in one and that's something that we're just really proud of what we'd go into.
Bob Decken: Maybe we go into, you know, into their backyard and beat them. And so you put all of that together. You know, we feel pretty good about that general trend.
Speaker Change: Their backyard and beat them.
Speaker Change: And so you put all that together, we feel pretty good about that general trend.
Bob Decken: And then the last piece, Dave, you touched on AI, and we see AI is an opportunity. And we're winning deals, and we have a huge pipeline where it'll be a new source of revenue while we're leveraging our chat bots, voice bots that will go and automate and take. What we think is market share away from our competitors that it's their voice calls. And they're, you know, that will come over to us. And so we're really excited about all of those elements and putting that together for, you know, hopefully a great FY 25.
Speaker Change: And then the last piece, David you touched on AI, and we see AI as an opportunity and we are winning deals and we have a huge pipeline where it'll be a new source of revenue, while we're leveraging our chat bots voice spots that will go and automate and take what we think is market share away.
Speaker Change: From our competitor, it's their voice calls and there.
Speaker Change: That will come over to us and so we're really excited about all of those elements and putting that together for <unk>.
Speaker Change: Hopefully a great FY 'twenty five.
David Coney: Now, that's great to hear. And then I guess my follow-up question, one of the key highlights, I mean, I guess a couple of the key highlights, one is margins keep going up.
Speaker Change: No.
Speaker Change: That's great to hear.
Speaker Change: And then I guess my follow up question one of the key highlights I guess a couple of the key highlights one is margins keep going up.
David Coney: And maybe how sustainable is that? Is there anything maybe one off this year and both in 2024 and 2025, or is that just scale, etc. And then I guess buybacks or the other kind of thing that's a big highlight, you know, is that going to continue?
Speaker Change: And maybe how sustainable is that is there anything maybe one off this year.
Speaker Change: In 2024, and 2025 or is that just scale et cetera.
Speaker Change: And then I guess buybacks or any other kind of thing that's a big highlight is that going to continue I think youre at three times EBITDA, that's almost never seen that in my career, especially for a company growing margins. So.
David Coney: I think you're at three times EBITDA; that's almost never seen that in my career, especially for a company growing margin. So, you know, maybe those two things too.
Speaker Change: Those two things too.
Taylor Greenwald: Yeah, hey Taylor, do you want to, why don't you take the margin discussion? Yeah, no, absolutely. And David, you know, we do have the ability, and we will continue to improve margins. I think next year, if you look at our guidance, you'll see some improvement over fiscal year 24. I think we're 12, 7, 12, 8 fiscal year 24. And we should be in the low 13s in fiscal year 25. And we see that margin improvement continuing. A few trends are going to help us, you know, continue this over the next few years. I think, you know, the first, you know, big lever is the fact that we continue to grow our most profitable, you know, geographies and services.
Speaker Change: Yeah, Hey, Taylor do you want to why don't you take the margin discussion, yes, no absolutely and David we do have the ability and we will continue to improve margins I think next year. If you look at our guidance you.
Speaker Change: Youll see some improvement over fiscal year 'twenty for I think 12 712 eight in fiscal year 'twenty four and we should really be in the low <unk> in fiscal year, 'twenty, five and we see that margin improvement continuing.
Speaker Change: <unk> trends are going to help us.
With this over the next few years I think the first big levers. The fact that we continue to grow our most profitable geographies and services and AI will contribute to that as well well, where this where the services agreements that were signed are going to come with higher margins. So that can help drive us forward.
Taylor Greenwald: And AI will contribute to that as well, where the services and agreements that we're signed are going to come with higher margins. So that's going to help drive us forward. Economies of scale and operating leverage, you know, we're still a relatively small player with, you know, a significant infrastructure for a public company that doesn't need to scale the same rate as our revenue. So I think we'll see leverage with growth that's going to drive our margin. And then in terms of, you know, some items that may be put a little pressure on the margin going forward, you know, we have this business always has wage pressure.
Speaker Change: Enemies of scale and operating leverage and we're still a relatively small player with.
Speaker Change: A significant infrastructure for a public company.
Speaker Change: It doesn't need to scale at the same rate as our revenues. So I think we will see leverage with growth is going to drive our margin and then in terms of.
Speaker Change: Some items that may be put a little pressure on the margin going forward.
Speaker Change: Yes, there's always has wage pressure, we do a very good job with Kohl's, our contracts and negotiating price increases, but thats something we always keep our eye on and also.
Taylor Greenwald: We do a very good job with coal as our contracts and negotiating price increases, but that's something we always need to keep our eye on. And also, you know, we are going to continue to invest in business, right? We want to, can you grow? So you saw that fiscal year 24, where we're investing our infrastructure and a new ERP system, you know, financial system, technology resources, and sales resources. And we're going to continue to balance those investments as well, so that we can, so we manage our business with ongoing margin improvement, while we're still making investments in the business. That answers the question.
Speaker Change: We are going to continue to invest in the business right. We wanted to can you grow. So you saw that in fiscal year 'twenty four we invest in our infrastructure and our new ERP system financial system.
Knowledge resources and sales resources, and we're going to continue to balance those investments as well.
So that will that we manage our business with ongoing margin improvement, while we're still making investments in the business and I answered the question.
Taylor Greenwald: You know, ultimately, I think in the next few years, our goal would be to get to 15% EBITDA margin for the full year, and not just the back half of the year.
Speaker Change: Ultimately I think the next few years, our goal would be to get to 15% EBITDA margin for.
Speaker Change: For the full year and not just the back half of the year.
David Coney: Yeah, thank you guys. That's great.
Speaker Change: Thank you guys Thats great.
David Coney: And David, did we answer your, you had a part B of that question, I think was on the share of buyback, but maybe if you could just restate that question, if you want. Yeah, that was a long question; sorry. Yeah, just if you're going to continue, I mean, a lot of that cash is the plan to kind of study buybacks continue. Yes, it is. You know, we, look, we have, I think, 27 million still to go on our latest, you know, announcement, you know, the total of 30 million. So, have a long way to go, you know, and so I think, as we think about our capital allocations, that's one use.
Speaker Change: And David did we answer.
Speaker Change: You had a part b of that question I think was on the share buyback, but maybe if you could just restate that question.
David Koning: Yeah. It was a long question sorry, yes.
Yeah, just if youre going to continue I mean, you have a lot of net cash is the plan to kind of steady buybacks continue.
Speaker Change: Yes. It is.
Speaker Change: Look we have I think 27 million still to go on our latest.
Speaker Change: You know announcement.
Speaker Change: A total of $30 million so they have a long way to go.
Speaker Change: And so I think as we think about our capital allocations.
Thats one use.
Bob Decken: We have done a really good job of filling up a lot of that capacity we built out over the COVID years, you know, when we're doubling our cap acts because of social distancing, if you recall. And so, you know, I think we'll, we'll see ourselves continue to do buildouts this year, you know, kind of let's say restart buildouts in our offshore regions, you know, that will spend a little bit of cap X dollars on that.
Speaker Change: We have done a really good job of.
Speaker Change: Filling up a lot of that capacity, we built out over those co over the COVID-19 years.
Speaker Change: When we were doubling our capex because of social distancing, if you recall and so.
Speaker Change: I think we'll we'll see ourselves continue to do build outs. This year, you know kind of let's say restart build outs in our offshore regions that we'll spend a little bit of capex dollars on that.
Bob Decken: And then lastly, you know, I'll just say, you know, we intentionally, in this past year, put our focus not on M&A but on AI. And we really wanted to make sure we were pushing and being first mover in the world of driving AI solutions. And we didn't want to get distracted by going down and spending a lot of time in M&A and then a lot of time in integration. And if you look at that, we're further ahead than anybody in AI. So we think that was a smart thing.
Speaker Change: And then lastly.
Speaker Change: Just say.
Speaker Change: We intentionally in this past year put our focus not on M&A, but on AI.
Speaker Change: We really wanted to make sure we were pushing and being first mover in the world are driving AI solutions, and we didn't want to get distracted by going down in spending a lot of time in M&A and then a lot of time in integration and.
And if you look at that we're further ahead than anybody in AI. So really we think that was the smart thing, but now that we have that.
David Coney: But now that we have that in this real strong, free cash flow generation, I think we're now at the point where we can look at and say, what are the things, what are the geographies, what are the areas that we can invest in that we can look to be a co-sitive in to help us, you know, strengthen our business and accelerate growth. And so, you know, again, that's kind of how we're looking at 25. Yeah, great. Thanks, guys.
Speaker Change: <unk>.
Speaker Change: Real strong free cash flow generation I think we're now at a point, where we can look at and say what are the things what are the geographies. What are the areas that we can invest in that we can look to be acquisitive into helped us.
Speaker Change: Strengthen our business and accelerate growth and so.
Speaker Change: Again, that's kind of how we're looking at 25.
Speaker Change: Great. Thanks, guys.
Speaker Change: Thank you Ed.
Operator: Thank you.
Operator: This now concludes our call for today.
Speaker Change: Thank you. This now concludes our call for today I would now like to turn it over to Bob <unk> for any closing remarks.
Bob Decken: I would not like to turn it over to Bob Dechant for any closing remarks. Hey, Josh, thank you. And appreciate everybody's time and listening to this. As you can tell, we're really excited about the business, the quarter, mostly, and just want to highlight so proud of the team that delivered this and will continue to deliver for you guys as we move into FY25. So thank you all, and we'll talk to you next quarter. Thank you.
Bob: Hey, Josh Thank you and I appreciate everybody's time and listening to this as you can tell we're really excited about the business for the quarter.
Bob: Mostly in just want to highlight so proud of the team that delivered this and will continue to deliver for you guys as we move into FY 'twenty fives. So thank you all and we'll talk to you next quarter.
Operator: This concludes the conference. Thank you for your participation. You may now disconnect.
Speaker Change: Thank you. This concludes the conference. Thank you for your participation you may now disconnect.
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