Earnings call transcript Q1 2023

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Operator

Good morning, and welcome, everyone, to the Information Services Group First Quarter Conference Call. This call is being recorded and will be available on ISG’s website within 24 hours.

Now I would like to turn the call over to Mr. Barry Holt for his opening remarks and introductions. Mr. ahead. go please Holt,

Barry Holt

call. Hello, Alfonso, a morning. ISG. senior everyone Financial Executive quarter to operator. Connors, by Barry and Officer. Vice Chairman I’d name President Holt. welcome Chief conference first ISG’s I’m communications and to joined and you, today My Michael Humberto good Officer; is like I’m Executive Thank executive Chief at and

forward-looking It statements, begin, concerning like potential represent management communication to is statement. important I’d forward-looking this the to we effects. expectations Before may future current a contain which the of their and that note read events beliefs and ISG of

statements uncertainties those These are and that and could results cause anticipated. to of not from are actual future materially risks subject to certain results guarantees differ

risks last listing other our SEC future to the year forward-looking a affect could results. to furnished detailed in and statement Risk Form please section contained that was night full For results, that more in covering factors refer ISG’s Form Factors XX-K the the X-K the and of

should report with XX-K SEC. relevant any other documents amendments on including to the annual also any read and documents, filed or Form supplements You ISG’s these

copies either You’ll ISG or reflect events obtain of to any statement free filings revise obligation forward-looking to on no or any to undertakes subsequent be SEC’s SEC website ISG’s able ISG’s www.isg-one.com at www.sec.gov. circumstances. website of the at update or

earnings data which a financial measures financial include on which measures, of this key for constant believes currency During we transparency results selected adjusted financial The touch provides on discuss and evaluate measures, the ISG to periods performance. greater presentation comparability the used EBITDA, will non-GAAP net adjusted certain the the between company’s call, today, improves basis. and of non-GAAP will company’s we of

for additional GAAP. as not in results as isolation in or provided be a are with should and considered financial information substitute prepared measures Non-GAAP accordance

please measure, applicable will SEC. now call current by on to Bert And followed measures filed Mike? refer Form the I’d report most was turn For who X-K, the GAAP of presented to non-GAAP all with reconciliation Connors, which be the to Michael like the closely our night Alfonso. to over last

Michael Connors

Today, the ISG you, quarter, for our morning, review The our next for everyone. model. significant and first good revenue second growth, our our targets our for will recurring outlook record operating we X margins Phase revenues dividend and quarter. recurring Thank our of revenue Barry, increase in XXXX under the and

of in start XX% largest year the revenues ISG high constant to million, up delivered quarterly and a the XX% led currency with strong Americas, $XX an by region. our all-time reaching in growth

expand record We continue our revenues, XX% year quarter. $XX versus representing XX% this million, the recurring of reaching our a prior revenues firm-wide to up and

vendor business our growth revenues GovernX double-digit driven in and Recurring by operating our and were management research in business. risk compliance

Our of million. adjusted reached EBITDA a $XX first quarter record

in recall, to of further is off our the you growth. demand next client top talent decided in additional of of the years. in growing we last second to beginning year As hiring half couple decision in That anticipation line invest pay during

standpoint digital application experience, both future from digital on-going areas: cost modernization and is optimization. We group analytics. business; and driven secondly, in key productivity in on Transformation expect data to customer including by being two areas, client blend this is cybersecurity, environment workplace, transformation, The demand and a focused midyear. cloud,

and utilizing comes When line dropping the to the a also approaches, they all enterprise. projects about grow digital savings connected it’s and quick taking the are initiatives. Clients taking to cost the of through prioritizing creating to out business returns. focus intelligent it on end, secure, are one bottom optimization, cost takeout, productivity transformation two the that In savings are cost

the current in position ideal an power to our environment. in is ISG help through clients

Our transformation, continues platforms combination optimization to our sourcing digital a be cost clients. portfolio supported winning digital our for research by of SaaS and services, and proprietary

model, operating tremendous the Next realized ISG our we results years. have Under over last two

We and due EBITDA adjusted EBITDA XX% by XXX in have than about portfolio and basis more higher-margin to solutions. points, more efficient grown of our delivery or by margin than large our our XX% adjusted part network iPlex

also base clients ISG grown to We Next proposition have and our served to pandemic by our enhanced more solution-centric very clients, XX% during than the XXX approach. has value our us thanks client years. over well and

on are X we ISG era, of post-pandemic the ready embark Next. Phase in Now to

we last the to approximately year. $XXX to adjusted target of to the expand our our million surpassing from million XXX end $XXX and margin, points the By of XXXX, of end accelerate our after growth of XX% basis XXXX aim EBITDA a revenues further recurring previous

are excited our ISG we now our of of look next as to the post-pandemic and forward growth clients the We future phase about digital for prepare economy.

that’s the what among spear early are transform tip ahead. of only Chat grabbing today other We are the AI generative glimpses new world being seeing developed that but of will lies already types our and the headlines, of technologies tomorrow. GPT

AI At our it development. ISG, our harnessing and expertise own applying growing operations we product and are in to

For called example, Agreement contracting in XXXX, we AI-driven smart tool. and acquired its a company

using are in our solution, flagship to revenue drive platform now areas ISG We agreement growth help such recurring as GovernX.

build of segments going to built platform on is and the our the as deliver and additional future us and us we the drive developments such repeatable improve capture more are allow excel culture unveiling to carry of many the be efficiency into our XXXX ahead innovation unrelenting opportunities ISG market. and we capabilities, to confident forward out targets will entrepreneurship. today. our a growth meet I’m value will to more There look

delivering of Americas million to on XX% our the an $XX year strength cost revenue, The market-leading up versus the QX, our prior and regions. excellent offerings. had of turning Now optimization digital sourcing

banking, services Centene. the also included & QX, first verticals. industry our and software digits. double-digit insurance, During among Minor Bell double in Key Canada, client during Group, and engagements consumer, manufacturing, Financial all advisory and saw GovernX quarter Owens energy our we And growth network, utilities were up CNO

quarter, a than more provider service a its the $X research three benchmark, million. Pro renewed our worth global pricing to market-leading deal subscription IT years service for During in

a a major won our automation, optimization design, covering model We many health managed multimillion-dollar also benchmarking, operating cybersecurity. care provider software network, services, technology engagement including of cost and with

save client we Our $XXX annually. more to than holistic this approach, million expect

In extended large addition, we and our with telecommunications a services Canadian ISG X for years automation provider. licenses

turning Now Europe. to

million Our QX of X% over currency last $XX revenues were in constant up year.

and Services Union Belfius double-digit and Europe the Hydra, included Europe manufacturing and first quarter, revenue our research energy, in our For verticals engagements businesses. the network, industry media, software in utilities GovernX client quarter Bank. in in and Key growth delivered IT Munich Re, advisory

and quarter, European to identity $X management awarded application of modernize one of During IT Ministry ISG the Finance includes legacy the framework. a access service management their country, Scope and million an architecture. engagement

their a new We model million support partners Germany delivery gas to and with with digital and we oil technology advisory business to won engagement. also on extension strategy. a SAP engagement major services provide project an $X their significant in And secured select company banking and redesign European to future and an company a management

turning Asia Now to Pacific.

software flat Department quarter generated about were double-digit $X currency growth our advisory businesses. Home of Australian the network, $XXX,XXX and essentially included in or million constant or revenues development, clients last We very ecosystem GovernX long-time Key with with the in of down year. QX in and for $X to Office, new we recently million client, won Affairs contract Australian a Insurance future. revamp lay their the the very a Taxation their Australia the groundwork digital and positive ATO, Group. In provider Our

quarterly to am our $X.XX on-going a to delighted to This of announce as our progress decision The per year I June dividend. and reflects rate, or reward shareholders, commitment In in quarterly dividend. June X. for business. be Directors our has reflected dividend $X.XXX in authorized on share increase new our turning our continuing Board payment to of will outlook Now of per XX.X% the XX shareholders record our long-term

guidance. to spot. build right an looking in achieve their is invest uncertain for our macro sweet create environments. go-to in advantage. maintain to they services the investments ways remains and excellence. business technology And competitive and helping turn me optimizing environment, and let for fund futures digital our This continue by those ISG their to operational is strong. clients demand partner for digital to Now Enterprises are in Even

optimistic our are energized prospects. We and by

the and talent concerns also economic the that are of decision-making, banking factors mindful client of including and impact timing could We shortages. recession, geopolitical possible inflation,

consideration In million quarter, $XX this, for of the $XX and EBITDA we between second of adjusted of revenues and all million. are $XX between and $XX million million targeting

who turn me Bert? call let financial Bert, with the So will summarize results. to over our that,

Humberto Alfonso

and you, morning, Thank Mike, good everyone.

currency. Compared reported all-time on last $XX.X basis revenues reported and $XX.X delivered the $X.X recorded ISG versus versus the revenues in were revenues to on down for year. quarter Asia down prior were X% up reported million, the reported first in prior mentioned, a million, the $X constant EBITDA currency. million, record by Pacific, revenues X% and were reported negatively year. the in X% Revenues impacted Mike In in million, start In adjusted and revenues XX% constant X% $XX.X quarter first X% million Currency Europe, a currency. basis And up and year. the constant first Americas, were XX% quarter down year. up of with As

was quarter. compared up quarter year, year’s up of from with In margin First year. EBITDA points XX%, adjusted last down basis $XX X% compared currency, an prior with million, adjusted prior in constant resulting was first EBITDA EBITDA X% XX the the

with quarter income per the million share share income per fully compared quarter million $X.X First was prior or in operating fully was year. the Net $X.XX for prior year. or compared of $X.XX with the $X.X million $X.X $X.X diluted income net million diluted in

fully XX per First share income or net of first diluted or net March prior quarter million per with was up professionals $X.X X.X% year’s million from the or quarter. $X share Headcount diluted of as QX. $X.XX adjusted XX, was income X,XXX compared XXXX, in adjusted fully $X.XX

by for time quarter was last the first the additional utilization XX%, hiring needed half second impacted onboard our and resources. billable to year Consulting

our term. the flexibility sheet balance continues business to long support strength Our the over and have to

from was million of year-end. ended million cash, with quarter, $XX.X at cash down net the used quarter For million. We operations $X.X $XX.X from the

During totaling shares. and quarter, repurchased the million $X.X ISG million of paid first dividends $X

X. Our record on next shareholders June quarterly dividend will be on XX payable June to of

unchanged Our is debt-to-EBITDA debt X.X remained million, our the year-end, from $XX.X in shape times. great at at ratio balance and

X.X%, remarks X% ended we the up quarter to rate before for quarter outstanding. shares from Our make was some last we borrowing million will the now and year, with Q&A. Mike the XX.X go average concluding

Back to Mike. you,

Michael Connors

To record start EBITDA delivering revenues Bert. recurring quarter. strong adjusted summarize, is and a record you, off in record Thank revenues, to ISG in first the XXXX,

and for clients. Our to portfolio a be optimization our sourcing cost combination platforms SaaS continues research digital and transformation, services, of winning

enterprises. connected ahead end prepare we intelligent our an we opportunities of the recurring of revenue economy XXX deliver Capitalizing as million wave those under growth tremendous opportunities, Phase help on reach points become to $XXX next have and the and XXXX improvement by Next. additional X of clients ISG We plan the for basis digital of in secure, margin

to share And dividend our our XX.X% we continue shareholders, raising annually. to $X.XX per reward

long are the in operational are our mission As for creating on to term, value focused and excellence always, we deliver we shareholder to steadfast clients. our

in morning. thank for So calling very this you much

your And for operator let the turn now me session to the over questions.

Operator

take Instuctions] [Operator now will with Joe the first Gomes Absolutely. Markets. question Noble from Capital We

You proceed. may

Joe Gomes

on guys the this call. Gomes Joe Hi is

also I well, I just as the of increasing with direct I revenues have? there. kind saw we of quarter think come that -- XXX expect question of in you points. new and just and kind that increasing, run kind to I that rate Or services a say we by get So just to be a to first cost do obviously just just -- down? Is that probably want should saw in the basis advisory might wanted

Humberto Alfonso

the sort me let Josh, you on that Yes, operating for of cover income.

some as tax tend a had payroll related back as we higher little they that higher costs mentioned, to to or costs, XXX the we They of bit were in. side, as on QX. about But had points. small We down about SG&A XX $X up direct we’re we Our some amortization well. and million come points be basis in typically basis offset you have

on our But low the we utilization which rate, of end also XX% and targeting. commented really on our at is expectation, the is

terms our in we hiring -- year, concentrated back back We we which have in potential and bring will as resources. did global was up last the of is mid-XXs to that tended be to the that QX in we in the half the for come that full mid-XXs, of more into our speed expectation

certainly we expect to into So the that half. quarter back do improve second into and the

Joe Gomes

Okay. Perfect.

regarding you expectation are guys year, now the quarter do for rest the just so just of is this just And of the trend we’re in what that inversing year? events? a guys what just into have you kind noticing the And

Humberto Alfonso

events? Did you say in-person

Joe Gomes

Yes.

Humberto Alfonso

Yes. Yes.

of for we definitely are held as quarter, series a the first the full So both events full those that of as all the the person, Europe. here events during roster a have have a few and in We’ve no, planning each we in we next do quarters year. U.S. to of in planned well of three in

Joe Gomes

just in And pipeline I on guys lastly, more for then acquisition, you it year that Perfect. you is regarding are the commented Okay. just know kind prospects. focused this of last guys recurring revenue --

that. is pricing-wise bit just the things little a Just look a us of made as on the better kind little worse? how looking? little economic just that uncertainty wise, And Just provide pricing color bit a of kind

Michael Connors

we focus approach, revenue or areas around possible areas. string we digital with M&A side, increasing capabilities continue high on or bolt-on call -- our is to yes, recurring So which our acquisitions around our continues in to targets. pearls be dialogue of have like the And our

of always the terms the the all In at in pricing different our know say moment. disciplined pricing. pricing, And approach don’t would is I we I that been that very to that have

but who tick still if in on the pricing view. you a significant then real and but overall lot a have it. we owner have feel is softer, of Overall, softness a materiality they my frankly, yes, And up, seen have of of slightly business that nothing holding is value side a operators You not have their might down, expect. it’s the environment

Joe Gomes

Okay congrats guys. on again, quarter Yes, perfect. the

Operator

The Sidoti from the with Company. Riddick comes Marc next and of question line

You may proceed.

Marc Riddick

Hey morning. good

a So right into jump I wanted to couple of.

First all, to a was see X it of surprise pleasant the Phase announcement.

recurring little -- the on you as to you wondering announce could strength of Phase to multiple well bit sort margin But how going about talk of Maybe talk of at between the opportunities of we’re kind of I those last year. level little as those that if ramp-up maybe a bit a confidence you could and gives mean, as that going were expansion hired pieces revenue there. ahead? X about the what point this of I hinted to You’ve sort get was

Michael Connors

Yes.

Mark research a to million. first, the quarter over question. So had thanks saw, we we recurring continue for build robust we out $XX -- very you as But Look, our capabilities. revenue, on are

anchored contracts read business. from And risk a our build about we that platform, continue we platform to like GovernX, quite is that using us has that platform our our of regulatory our supply because of our we and benchmark, by especially GovernX etcetera, clients our use We a out pricing is which that which how chain, ago intelligence been management have with longer-term to Pro is to is that platform clients lot public in the issues, able sector. along, is for moving AI which and think artificial boost acquired contracts agreement when to these we’re a year relative also

we these said as $XXX as subscriptions, we let path, know you confident a excel. that’s XXXX, get $XXX think about just way to we that’s and out back know why in don’t we that solutions to headed. that’s can that we we’re come feel complete million Maybe see we exact had million. reach continuing today where have the in areas, but we we these and about think we we confident we’re And line, forward, and why decided to along businesses that And would

Marc Riddick

And that reasons. about because bit a -- as your maybe the it talk little And as encouraging. maybe a bit about And wondering on a these far more of I little accounts. these both was how that if a those talk driven for cost macroeconomic are the little obviously little sales you certainly remarks getting you as prepared you Or Is accounts bit I you cycle? was bit it’s could then are though a by in is And that along lines offensive sales a And sense environment? talk could cycle new it could accelerated mentioned are traditional optimization you talk sounds defensive the the if new -- well? wondering of about Great. you as sort growth? coming and than of because about little

Michael Connors

Good Yes. question.

So me let slightly. parse it

we and terms in seeing of by segment. it what are industry First, a varies bit

So if that to now about companies we -- of a media, a think together, we we see and looking four are kind airlines, specialty and stabilize about kind that we -- high-tech box think we ourselves, around lot retailers, put firms. of right a of

because kind a companies utilities, If see of moment devices, faster that moving to and the medical a mode. can, see manufacturing you stabilization think wanting not are at who’s are pace and we increasing pharma, in they like about maybe

the result, of that two transformation. So the stabilize. around to really one is you forks side optimization, you have, road, pursue tends energy kind cost as to of on let continue with in a the And those that it, and other have, me need to some be

And so asked, fast. but to that the speed industry optimization you it is point moving varies by cost segment,

So with fast done? cost we And might who get can that CIO wants million out a of take you how meeting $XXX be Monday. and on start to can a today

speed kind optimization. that’s of on So a

bit what them On lot the are doing, a a on other slower. side, little transformation of that’s

So the optimization the slower moving. maybe still pace are is but at engagements moving, than a pace

that of first question. us the quarter. significant have of the helpful saw in both has for quite in hope growth kind been I driven your toolkit having is our So us, and those answers to that what you as

So any...

Marc Riddick

talk to from headcount me. additions add one that of we you’ll to you’re the Do take it new folks you more maybe and I availability that of that’s little get I can the the give sense year helpful, was new update very, maybe No, an wins opportunities up. if you that see does. ramped last very And that you definitely need you. there? the about have so, as you wanted bit advantage Thanks. last a these guess out talent No, seeing? to had thank sort of

Michael Connors

employees did Yes, surgical through specialty carry that the be the cyber. of digital or in there’s year, XXXX. us will first, like instances asking exceptions I The of few take are we who get you’ll is think may us do of back if the service, some areas we will during execute is service. our which hires to chunks to to recall some that against a which might clients new have that that we we up think a then it, And advantage training we as half TAD

We out those that, you XX probably XX their people service. who like and a because us enterprise and would our might training if of of pick XX, it large a transfer Fortune put the We some take over of take would need kind have TAD not like And negotiating service company up do of to we into you them. with with very all top is basically organization something XX, that. them

an kind the forward our it, other, we exception, a would during mark I the concept looking So only their maybe like of have that’s the might course that call year clients are go that and to because enterprise. way we TAS in to few alternative see of

So how we see the that’s headcount.

very of that with mix quarter business was and etcetera, will attractive, way our why first add we were year. and -- do that On we to we the availability, we because last able and since cash talent model our say are I stock,

XXX-plus think around people. it’s I

we it’s we need to think talent access we We are if that it. able available need, and the

Marc Riddick

much. you Thank good. Sounds very

Michael Connors

Marc. Thanks

Operator

Michael Thank of with Singular comes you. Matheson The question the line Research. next from

You proceed. may

Michael Matheson

numbers across Good board. questions. the morning, of couple a gentlemen. great I have Congratulations,

have possibly due forecast revenue we down? the look or comparisons currency Your for your should dollar headwinds. geographic our bit mix, a hurt been long stabilizing lifting be to you across When time year-over-year long-term with a trending

Humberto Alfonso

the Michael. Thanks Thanks, Yes. for question.

really fourth downshift in QX. second in being impacted heavily impact million quarter. X% We point, not had we over downside. certainly to $X of about quarter was the on see First To quarter the QX a down and your from the

have and numbers starting around up pound XXX, XXX year. may some are that impact negative so And while last with the we euro the we to approach it’s saw

will we’re in and that we still than has some see Fed to that assumes so European somewhat will and the right because finished that think We bit ways way honest. describe if more But could a that inflation be go if to the the back benign. now, the they to around projecting the quarter energy be not midyear And have little want be you bank half a it trend again, we second tailwind, do. continues

sort levels in don’t another don’t that We reasonably flat We’re think big impact in certainly quarter we’re to thinking year-end. first way But one we back see going of in continuing. out and seeing a be it QX stays there’s the the to the half. headwind or

Michael Matheson

Great. generate Last a lot Very assets flows. ISG’s helpful, you. for quarters, me. one thank most In operating cash of

This you $X.X the comment what was million. exception, quarter on swing? Would drove an negative

Humberto Alfonso

in Yes, the working slightly requirements net we the sure. was you was income we first Well, finish by lower sales reaching have very had in that And what it to March. -- drove quarter bit also in strong the with increase new compounded a as a capital really the high. did quarter a little And noted, quarter. might have

higher also slightly And we’re payables. higher about up receivables, our we you the so if And quarter-on-quarter, $X.X at look had million.

some that quarter from taxes that payroll first into come additional And of year. the comes the of

would mention our shape. receivables that of level very I in So the year out are those good to sort

overdue. We’re sort our current in X of approaching XXs terms almost of XX% to

So on are any put we haven’t had way. and that any reserves in material no to collectability, concerns up

income. tax It net about I also So have it was even slightly And No implication. year-on-year. capital a we really was working question. as did mentioned, lower

Michael Matheson

Very explanation, quarter. again on and the Great. thanks congratulations helpful Okay.

Humberto Alfonso

Michael. Thanks

Operator

Colicchio Barrington from of The line with Research. Thank you. the next question Vincent comes

may proceed. You

Vincent Colicchio

I questions. Mike. couple of have a quarter, Nice Yes.

perhaps the market? the the Europe deal balance the maybe big to or And that So of in why should this we Americas there and Americas slower is the was anything Americas see systematic continue or APAC a cycles of year? seeing outperform in quarter? there in terms was so like anything And sales relatively are strong

Michael Connors

Yes.

the thanks on Vincent, Americas comments. -- So for the

continues in On big I different, terms the elsewhere, transformation deal the But think in the what the of environment was slightly quarter. outlier there in digital anything is transformation or the is at the somewhat fund no U.S. the Americas, efforts humming U.S. you digital to efforts categories, optimization work in We’ve some both with coupled really That, of got all those will, on cylinders. pace. if

the digital slightly So optimization using to cost then cost instances over being we’re in line. the many optimization different, moved side is to the which to driving are is seeing takeout, but the Europe, they U.S. In optimization, take in cost bottom

As the the I than environment more more a a Europe would experiencing, softness, markets over little is. macro little companies say, U.S. are

we And continues, would bit cetera. the slower demand pace but et transformation of sourcing a heavier digital it’s optimization, in a see Europe. kind on the I of So optimization, say

in On two the into a Asia Pacific, strong year. ups I some wouldn’t this it. of downs. They comps first had very quarters read anything and has That

year We Asia perform full have. basis they as always on expect Pacific a to

I on, So than is wouldn’t it I the little is where macro read environment, a Pacific. we to is, eye an The into in Asia that think, think, U.K. I only the of area course, elsewhere in in particular, keep tougher Europe, continue world. anything

Vincent Colicchio

we mentioned were see could pipelines cost half areas sourcing that you look sales the sweet healthy if that the are prior digital digital confidence second give And a for transformation, you demand that year? optimization. versus you spots your at Does

Michael Connors

think I our year. confident are mean full in we I Yes.

warning what us. of the always macro environment health always is ahead the they know I course, we give Of has don’t

So feel nothing role a the we about path demand if and just for help it bit to is But caution. a full then the our the goes of very too off that environment neutral far, used that and against we as year. somewhat execute good

Vincent Colicchio

revenue $XXX And recurring the recurring revenue fast acquisitions. a that portion two you to be on I going How your grow can of do next in million think is objective years? organically assume of the

Michael Connors

Yes.

then, number be million If around to that, time an and can do additive on were But reach organic that we any So described. organic. we organic able that the $XXX Vince. we basis would think frame to that that we is

that how So are we’re business. building quite in we confident

Vincent Colicchio

That’s a fairly impressive number.

could areas on think you which are the you most important growth little give detail a drivers? So be

Michael Connors

business Number mean I is think thrive. research it’s Yes. I continues one to three. our

our proprietary research. So that’s

We in have that because have such a the insights environment. no large share have we else one sourcing can market

and wide there that us gives data. the is in one number of engagement powerful live That market. We’re a real lots by degree, force a

So we continue firm research to growth. that outperform will believe of in the overall terms

Our management, which others. supplier the management with our is help technology to GovernX use AT&T IBM or large of large that likes enterprises business, their manage contracts and risk platform

years. has to over the believe We overall which and that that continue business, AI acquired ago, to that thrive technology the smart big technology, continue will boom using next a few our is year also agreement expect outgrow our firm been we a and contract that for we and

sector. larger our public areas contracts multiyear of in the is Thirdly

We that’s government -- we Australia technology continue type our of the in whether legacy that with or government feel Italy, the state Germany or in a governments work. and to help or in U.S. have environment lot government, digital to local that’s our where major U.K., federal the in whether

technology governments see these are gets continue in then We aging, as becomes there. than older to that legacy many positioned we the more of the pretty workforce feel well pronounced, we’re modernization and

our revenue So recurring feel add elements those we about quite of capabilities. when strong together, all we

Vincent Colicchio

Thank you. acquisitions one quick was to don’t the you quarter? leave I want contribution of in you. the Bert, And one out. What for

Humberto Alfonso

-- quite was million. about $X.X not Acquisitions it

Vincent Colicchio

you. Thank

Humberto Alfonso

Thanks Vince.

Operator

of the from final The comes Dave Markets. Capital Stonegate question you. with Storm Thank line

proceed. may You

David Storms

morning. Good

that. mentioned, Just your you on touch wondering as revenue if rest could came you on in guidance, above

systematic? thing? touch could you it a Was timing of if would main Just the give what outperformance on can wondering you us else was. guidance? helpful. drivers Any there be Anything there that Was something

Michael Connors

taking even think And I which both Look, are we and sweet the to there’s transformation kind companies optimization accelerate environment in would expected. or is as cost, forks at other spots. two their our earlier, around have is the was of deep mentioned the are of around digital moment. journey, One road continue David. the of higher our Thanks, I demand portfolio that than

the takes start a normal which optimization are cost revenue cost optimization you other, take than the a time. because the goes sales on faster it a can decisioning journey, transformation increases, the then and cycle of the because cost therefore, maybe more first is out than earlier has when the made decisions during generates it sooner, quarter, and to is bit than which more And and need faster immediate a some

that drove drivers of key So that those probably would the the first be would outperformance. the kind we quarter see during

David Storms

could talk Very a about helpful. just more And then current little you leverage levels. lastly, bit your

confidence. lot You your have pet form a before of hitting

Just curious or using thinking liquidity? to how about that not as either you’re using

Humberto Alfonso

Yes. for the David. question, Thanks

As debt credit agreement you times now. able on revolver We’ve renewal we first trailing a had the sub-X% of know, right to X quarter, been maintain X.X%. full ratio we’re net about announced EBITDA in or the our that’s

we’re you that. very if will. think pleased So with underleveraged, could we consider it We

flow had now think do previous include I credit it pay flexibility to We have have quarter, payments little down over gone a of and want optionality with in the gives any our debt acquisitions, additional principal us wouldn’t mandatory cash don’t respect permits. $X agreement. under per that we we which away. of We as continue insinuate to to don’t those forecasts. I million

have right we But that that. like We now, feel that we optionality.

with not growth terms if sense acquisition, inorganically. right firm in look And being and for the the for in X.X% fine to continue opportunities we’re of the we’re at for perfect to that marketplace -- We strategic generation. makes grow profit plus

future, and good with balance happy really leverage, us shareholders. the we’re that in gives more but our the thing a and options us think we sheet that’s for for So

David Storms

strong congrats and Thank very you the quarter. That’s on helpful.

Humberto Alfonso

David. Thanks

Operator

There are at questions no time. this additional waiting

So additional or conference to management the team to I remarks. back any like now pass for would the closing

Michael Connors

Well, our let to me you as of to a to worldwide thank close by our professionals quarter their clients all for working our together record saying team results. global first and for dedication achieve

and And your continue to digital today of our day. a could support advice Our to confidence our be people in of the their you for journeys, call support for them. clients not have best they Have on passion the rest firm. and delivering prouder I the all of great thanks continued and a as

Operator

for That your conference you Thank concludes participation. today’s call.

disconnect You may now your lines.

Information Services (III) 9 May 232023 Q1 Earnings call transcript