XELA - Earnings call transcript Q4 2021 | Exela Technologies, Inc.

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Operator

Good day and welcome to the Exela Technologies, Inc. Fourth Quarter and Full Year 2021 Financial Results Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Marc Griffin of Investor Relations. Please go ahead.

Marc Griffin

you. Thank and Technologies’ everyone, Conference Quarter to Call. welcome afternoon, Fourth Exela XXXX Good by Chief Cogburn, Shrikant joined Ron I'm today Exela's Chief Officer. Sortur, Financial Executive our and Officer;

your and Following by Shrikant, questions. we prepared Ron will remarks take

is the call will a through at access via this XXXX. Exela's Investor commenting will be available on Exela's on A pending on issuance. exelatech.com. we available acquisition our also the website As today's to due is listed webcast, on Relations to page on of also conference take not website. of Investor during today's replay of securities session which able page the press of this is reminder legal live Information March call, call replay questions offer to is available which being the release, broadcast Q&A be XX, restrictions Today's on Relations

regarding that and statements and During differ Private statements. to from to these differ that These certain results factors are materially of occur materially statements. number Exela and Act of after assumptions no management's statements make statements that update forward-looking XX, March today, events as actual as events characterized XXXX. reflect undertake may actual could performance from today's any and cause current a will under subject Litigation be Reform any beliefs, results future of financial statements reflect those We obligation expectations to to Securities call, call, XXXX, the may this forward-looking

and the Investor or periodic report available with XX-K, factors SEC. filings Exela's refer risk recently website. of discussed today's the Relations filed SEC information, from with other along please Exela's are the more For the Form company's Copies in on page to press release the on most

information and page results business. refer performance on to we between measures. GAAP today's call views how measures non-GAAP these financial found we'll the note to We non-GAAP on provide page Reconciliations call call, operating of of Please Relations our financial non-GAAP our pleased Investor the believe can available Cogburn. on Ron, Regulation way, the be to conference certain additional management today's our I'm During the the discuss website. that over Relations of all website. call Investor mandatory on go out With turn presentation FD this of please accompanies ahead. disclosure CEO, also our Ron is the the

Ron Cogburn

thanks, call. us our XXXX and afternoon, fourth and everyone, Good quarter for joining our full on year

transformation business are XXXX. We pleased and the execution solid in of our with

are new improved efficiency year, while During and with to the are strategy, the sizable solid, our the of launches. for business our our pleased market, expansion for of SMB business stabilizing and fundamentals strong reduction revenue product digital our and growth. but we debt positioning we return particularly executed a The of further solutions for geographic business we growth opportunity see the a

Our technology additional customers dedication enhanced flow and to capital improvements thank want global their backbone will lead to and in to XXXX. structure success. and I enhanced margins for Exela's our our Also, team cash in

Exela's fourth million. Revenue of and was revised Total for with that, guidance year for with revenue quarter quarter was our the line XXXX. was which overview the Slide billion, #X, year with begin fourth full So in an $XXX for let's highlights. $X.XXX

While both X.X%. are basis, sequentially down $XX on by was million a QX revenue year-over-year up

basis points. services, QX significant. points. what's Full gross margin for which was the revenue, improvements here's focused resulted of year. XX down year basis slightly profit we profit was And in XX.X% efficient an for Gross good million delivery or expansion on of of $XX $XXX by at million XX.X% XXXX, During revenue, the our of XXX

gross revenue. profit more on We lower are in dollars

adjusted an we expansion points. XXX of revenue, of Additionally, XX.X% basis generated million or $XXX.X EBITDA of

$X.X or of of XXXX, $XX.X EBITDA of start enhancing on basis margin X% resulted in the year-over-year debt of Since million XX.X%, our our and we've generated importantly, More laser-focused XXX was adjusted adjusted points. which QX, capital structure. increase up that been we EBITDA an in reducing an long-term

pleased able series XX% were to of that long-term we debt by a our through are reduce million. transactions, or We $XXX

these on cash $XX Exela XXXX. track improvement flow With in improvements, a is for million

increased Exela also our We million. of almost market XXX% $XXX capitalization to by

increasing Now the performance have new business highlighted pipeline let's fundamental robust our activities. activity let's turn key are renewal talk of The to rates, Slide about by and our #X and inflected metrics. expansion drivers and of

rates renewal year-over-year. continue increased improve to were and Our X%

customer In of closed we traction, more XX% terms deals sequentially.

substantially including WFA, strategy are work-from-anywhere cloud. to the platforms, the cloud on of margin adoption usage. rise driving intelligent of continues usage in scaling or Many and to our and Cloud processing, of is fast expected usage than our up productivity. profile now data our from IDP, our should QX. Our that continues employee evolve, percentage and Cloud or initiatives, our the are strengthen platform, our XX% More XX% to rise. work-from-anywhere employees

I'd positioning extensive Slide our turn into Now the #X. made heading on to to XXXX. based in like XXXX on let's strong focus accomplishments

here, number and in upon the listed them we'll subsequent of tailwinds expand have We a slides.

to against rising a First, costs leveraging providing footprint. global the a work-from-anywhere while hedge adoption rise, continues

Second, anticipating is or subsiding COVID-XX stabilized.

growing Fourth, five, fundamentals. Third, analyst research both rapidly products, growing Street stronger in expanding And industry balance services, enterprise improving growing solutions sheet Wall markets. and and coverage. SMB and

also efficiency and increased stronger Looking sheet, notable and experiencing balance our the services. we are to in ahead, addition demand in products a

productivity. address the let's Now rising talk or about and to that solutions, let's increasing Slide the costs WFA, turn work-from-anywhere and #X

hiring challenging, we and Our geographies that efficiency costs locale. services our a we find cloud-based talent lower-cost large and the are from -- provide serve. system continues The rising and all is labor of will the increases against at to to well positioned all we work-from-anywhere now market model in hedge

driving delivery. IDP, our importantly, expansion data cloud-based More through more are intelligent system, efficient margin our processing, or WFA initiatives and

rightsizing During optimizing XXXX, reducing by made and headcount. our estate strides our great we footprint costs real in our

XX,XXX past in year, we and agents. to X,XXX our accelerate that than than this We to have WFA more increased more agents plan by XXXX

our than a by model customers to platform for we our our changing the per enhanced WFA Over so time. click cost output that are paying year, rather

scalable is global. and secure, solution Our work-from-anywhere

growing globally, competition Exela's access pool basis. for on talent labor a As gives our global to customers solution is

Now #X rates. let's let's look renewal talk about the and at Slide

Given case the of restrictions, business on-site in had hardest pre-XXXX rates and seen improvements COVID-XX about including our growth current impact environment, we are decreasing to future return we've on-site the the on lower optimistic business. we levels. COVID-XX the the and our as

we and been on-site the of prepandemic returns the annual rates As uptick if revenues benefit renewal that approximately would $XX we well eases activity, them. in million XXXX, levels, We to business. restrictions positioned estimate to from were a prepandemic a level of and are to our In had million XXXX have delayed. recover include that that to world $XX

also impressive year fourth strong very SMB digital DMR, or turn is Asia call to consistent remained QX late The let's progress the our our Since deployed an recently, -- we DrySign for finished part for process the DMR customers on XXXX, of digital trajectory and public segment as it, in to expanded health quarter, to was strong. many sectors. group XXX% EON, mailroom, in medium SMB most Finally, entrance automation strong SMB, our Europe growth for or across Pacific. Exela's and And SMB QX grew our including strong we growth DMR of XX% this In the our the in #X and customers we DrySign or XXXX. digital DAG. in new which our solution. into number geographies, update in grew robotic solid a of and new DrySign very and our business we our platform, Slide asset small have sector, of a offerings. sequentially, seen of users a asset an care users

Exela's Another outsourcing, which with notable HRO, we solutions. call or human HR launch business, in XXXX Exela resource

broader proposition Raptor. platform compact, to online our We existing updating a our coming as much quarters platform the expand Finally, online forward a high-speed will us up. IntelliScan products look accelerate the scanning of platform much platform and launched DMR the platform. you onto In suite remote we the also the cost. IntelliScan of help our launched SMBs in conversion launch. Raptor December, progress ramps comparable notarization notarization value The as on This to enterprise we capability at remote our platform our but provides of lower called

deck, Now the highlights let's which you slide turn to #X Slide X, and important and #X, which in it conceivably the is Slide on most #X. points saw

invest with start the let's business business of taken So and company. growth future our steps Exela has growth the to in

arena into by footprint our the science leadership and expanding example, data end with hundred FTEs goal of new year. several of consulting a the the For outside

the SMB the the business our P&L and solutions. accounting our followed practice, enterprise markets continued across by as Next, level, well and level of as of compensation the further talent expansion leadership additional and new at expansion goals to investment further alignment unit of finance

and strategic of digital Next, let's which IDP. more with year, term. did platforms coming talk partnerships near offerings, year we geographies hope Expansion potential than leveraging cloud the this news new and XXXX, with to we share we about which in last some to our launch new positioning. We've plan and engaged M&A, then

analysts. better increased Let's recognition stronger and Wall talk balance of to extended debt and industry financial of lower capital for about and course, the equity from Street through performance maturities sheet, the and cost The awards flexibility financials. XXXX preferred to

We continue -- excuse me.

and for we're efforts been confident As lead to XXXX, growth our expanded further you very can will and preparing profitability. we've that positions revenue busy see, and

now pleased our Fitzgerald on through that, We Riley I'll growing Shrikant and continue Shrikant? the coverage call detail. B. CFO, over in turn Street Sortur, and more research to to recommendations are are to numbers Exela. the run focus Wall that the With making on Cantor

Shrikant Sortur

and for our joining thanks year update consolidated our balance cover XXXX for and provide and an this us results will sheet segment quarter improvement fourth initiatives. performance afternoon. Ron, you, revenue Thank everyone on full I the and to

heard just offer, what In it, indicated misquoted offer. clarification. be into no Before dive pending offer. that a quick want the clarify, exchange exchange that some to offers. If talking acquisition you said acquisition he not it was I we'll pending as about Mark I was There's of spending or opening, pending

Just the right into to presentation. clarify. Jumping

the to fundamental. have year executed numbers. filings in and reporting in reconciliations are which a commitment appendix The we was we of done GAAP the As we our XXXX presentation. our non-GAAP past, are Exela's improve in on and the both in

our reached reduced $X.X we the sheet On and settle extended case our an lenders. debt of our front, recently, exchange prepayment by We at we long-term debt. December. long-term agreement on into credit of years substantially the revolving X all by maturity appraisal an billion. with end entered action the agreement balance to And the almost We

the we to compared operations improving adapted the revenue below metrics that new front, XXXX. our well to of normal On most

impact. of We at COVID-XX to We reason begin achieved full on our for All our revised of our be with the billion revenue call, with both unfavorable Slide We the this the year. provided about range. at approximately was XX to revenue said, in $X.XXX generally -- pressure me met XXXX the optimistic at unpredictable, we the feel original midpoint fourth for billion of continuous had gross came A our and XXXX. $X.XX ended the environment in review earnings on guidance and let on cautiously a year year achievements of quarter midpoint results. inflationary revenue margin a guidance QX and range XX%. satisfied and these profit year That and

decline or a X.X% quarter totaled million, an results. fourth the X.X% sequentially quarter the fourth at a million of Revenue increase First, $XXX.X year-over-year. and for $XX.X of look

Our be as X volumes, shown lower effects ITPS on by Ron by COVID-XX, the that of continues Slide upon. caused to touched primarily segment impacted

by our year-over-year and provider growth. Prevention solid and posted Solutions be our business both growth Legal driven and LLPS strong Healthcare driven Healthcare was new revenue segment project mix. to continued business, Our Loss segment by

result Our was year-over-year of management, XXX an profit and impact capacity XXXX of lower points fourth a gross cost of better basis margin revenue. offsetting the quarter increase XX.X% as from

we sequentially. QX Turning to EBITDA. up adjusted X.X% X.X% In XXXX, and EBITDA adjusted million, generated of year-over-year of $XX.X

QX QX. of in from quarter of XX X.X% our line XXXX XX.X%, revenue, basis margin expenditure expectations. and fourth points $X in XXX adjusted year-over-year or million was basis the points Our with up Capital EBITDA sequentially was for

Next, I'll P&L year XXXX and touch metrics. full results upon our

after forma $X.XXX XXXX the pro year-over-year basis a did For the on the and the on that divestitures Revenue mentioned. was I a a X.X% that adjusting adjusted year. pro we annual comparative, year-over-year for for X.X% basis a XXXX numbers decline billion, divestitures on year for are of reported in that forma basis

$XXX.X addition Revenue at revenue indicated segment we million, performance. return-to-office our of trailing delays impact quick our revenue As a guidance by to $XXX.X driven The business in transition for met the plan came segment million or our of decline range. our was earlier, revised look decrease and in at the on-site the are customers affecting XX.X% ITPS COVID-XX in primarily year-over-year. as was our A revenue. midpoint continued to

to industry the stable prior multiple headwinds by from year-over-year. experienced well $XX.X geographic million by see year-over-year, and million, revenue or to up are $X.X revenue from continue revenue diversified was robust. We of million once wins. of project X.X% and driven million, higher subside. the higher Solutions and are business X.X% $XXX.X driven segment year-over-year, Payer and primarily that pipeline year-over-year, as Revenue a XX.X% volumes was remains customer, an by down we clients. segment lower year-over-year. business increase segment year our expansion Overall, base revenue or was our Renewals million was a improved with compared and positioned volumes provider believe return is up or existing by to $X.X in volume primarily current and by standpoint. X% $XX.X LLPS Healthcare

ongoing profit on gross despite year-over-year capacity revenue management. million and approximately reflecting $XXX.X our increased focus Our by decline a or X.X% of million, cost $XX.X

balance profit by up or was for beginning profit advisory the our at X.X% the XXXX. down professional total met year year-over-year. gross points million, expenses and XXXX driven at year-over-year SG&A XXX gross $XXX.X primarily was We initiatives. for XXXX basis improvement higher million guidance by XX.X%, of provided Our despite $XX.X fees, our original sheet margin margin

$XXX.X of million increase $X.X year, million, year-over-year. we EBITDA an adjusted or X.X% of the generated For

points by as as compared adjusted XXXX lower charges, basis margin The O&R was XXXX. optimization for year-over-year. and $XX.X for it, to Our up XXX the year XX.X%, call restructuring $XX.X EBITDA we million million, was

For X.X% invested the million year, capital of expenditure revenue. we $XX or in

of go the to some flow highlights. Let us Slide turn over XX and cash

cash $XX year, the as decreased mostly our of result million, to refinancing million balance During activity. $XX a

interest Our year on included exchange and the cash loans. of prepayments interest and million for expense was term $XXX notes

due As part debt exchange, new debt of the of XX.X% Exela which paid cash the the our $XXX was XXXX, facility. notes and million secured of $XXX purchased million for with combination senior

of track in Exela to approximately As flow refinancing on and our our payment XXXX a activity, by is improve $XX debt XXXX result million. cash

Moving Slide to discuss our XX. updates like on I'd initiatives. to through balance sheet

capital $XXX equity year. announced million. million initiative, structure line during raised we a of this with long-term part debt $XXX in strategy, effectively As we our total capital our previously of deleveraging to the in And by reduce our deployed

long-term Additionally, the debt to subportion. the except exchange offer resulted in extending the July maturities of debt our for XXXX,

Finally, due in of and to million $XX in cash $XXX QX the million the exchange XX.X% agreed secured outstanding XXXX. of million under for facility senior notes $XX we XXXX, revolving

for are We not a XXXX. providing outlook formal

XXXX we purposes, metrics use and that modeling For suggest forecast. users to investors our historical other

on ease conditions look we'll and provide the more pressures macro As inflationary normalized, details to outlook.

CapEx XX% we margin X revenue are greater XX% gross In of margin which reference, historical profit and to than emphasize billion, EBITDA would revenue, X.X% earlier greater of revenue with line $X.XX areas than working levels. than in adjusted of revenue, our on the levels covered slides. closing, capital like these focus, all key of to of of For greater XX% approximately

$XXX for a maturities continued agreement is theme. a which operating positive fundamentals. appraisal solid $X.X a of improvement is leads action improvement, second revolver billion puts A better million Strengthening the in is across First, another. performance development. a The metrics. extension the us of financial all This and on sheet balance with Settlement The debt us and flexibility. reduction us nearly of provides good in position.

our delivery and long-term manage to costs. continue other Numerising through capacity we'll rising services against technology, to improvement. bet operating And headwinds. continue flow rising proprietary inflation focus cost of cash offset and to on that's We

enable and prepared being better segment. Exela our and business, growth and geographies. more the to investing future. across revenue. SMB We're encouraging, Third, we in growth focus for to talent in are profitable on M&A independence including the We product and expanding execution want range across is our

for questions. interaction for to line coverage. our grow today. expand Thank that, open Wall the continue With our I Street joining you Lastly, and us all

Operator

first from Siegler [Operator Our Fitzgerald. comes Instructions] from Cantor question Josh

Josh Siegler

Can by that $XX breaking of What you your bucket? included other adjustments? was charges some EBITDA down start of in million

Ron Cogburn

Shrikant? there, you Are

Shrikant Sortur

Sorry, you indicating of for Josh, Can the on I you are 'XX? the was mute. thank -- clarify add-backs question. for Or you QX

Josh Siegler

QX That's correct. that's Yes, correct. 'XX.

Shrikant Sortur

the guess I main I'll the items. -- main cover

You facility probably of offer, part -- detailed the the we are, The in on modification debt million. $XX loss exchange the of had approximately that's vast asset level. at a a main as then more to other items number And QX, on all than dark the a gain assets the than Josh. are to charges, Other there from -- equity of that's one. sale to costs regular big comp, noncash of regular severance that, noncash of

Josh Siegler

we thinking initiatives? cost saving then XXXX, helpful. progressing? That's about are guys you Okay. head And are as those How your into how

Shrikant Sortur

good cost One million $XX are flow then million One plus success through. Josh, the of touched on have continue execute year, right? again, those, looking converting XX.X, and is it XX.X. savings to about have Similarly, we I is, additional Josh. of way to from that at it indicator, GAAP to talked lot that was the this in XXXX, O&R savings past. $XX upon, O&R into savings a we We'll going

Josh Siegler

And one for last me. Okay. Understood.

exactly mentioned more are M&A I'd XXXX forward? moving company strategic the color on as you priorities. love bolster looking how can partnerships, market? you in the guys that. You some for What And

Ron Cogburn

Yes.

parties. help partnerships with me outside that. Strategic Let with are

we terms of be partnered solutions for and we talked we've that that pull year, in corporations fruitful think with and through. that they us through about the services to last we I of exceptionally some large those pull found and

share you near encourage just term the on to stay more would I and M&A, in as we'll far that. As tuned,

Operator

Securities. from comes B. from Riley Cummins The Zach next question

Zach Cummins

QX. sequential what a I on at was margin of it down just the dramatically over Just starting pretty basis running in couple with off quarters. you were mean the gross versus past

that can gross speak the margin line? some to So you saw the quarterly impacts to of we

Shrikant Sortur

Sure.

thanks to into all, use, the some had of for QX headwinds question, year-end in it anticipated from term kind QX. by expecting profitable one-timers of of what First wrong is some was margin That's of our in the in, gross but from that be perspective. had recollect, some We offset a if that going accruals, revenue from a businesses, come Zach. one-off the and the are of QX perspective, QX, trend you exactly happened QX, we one-timers we cost [PX] that could the higher-margin QX. in

Zach Cummins

terms Understood. of cash go quarter, But And flow the expense QX as how and that any here were you about impacting thinking interest paying other that we I number in of free you additional can kind to you in the had XXXX? mean, debt from were the items that improving speak into you're obviously, in that exchange.

Shrikant Sortur

completion. there on result and offer you as see the a with? zeroing is general I other onetimers a been QX impact was timing a finance that cash that exchange of specifically, regular at -- a from QX impact not cash things operational That's if you additional charges prepaid you interest particular there's of to from help you of even inflection, flow number the right? perspective, flows, a has AR in From those, that an operating look can AP the were there offer number we the completed, perspective, the and exchange note. that specific with capital working And only between

Zach Cummins

the cash No. quarter. for in typically generation free trying of flow operating to handle Exela. I flow the type I was I especially cash just this QX on, is mean, know quarters one of a stronger, get

portion the you impacts Obviously, of of a kind just of that. of the what some saw was were offer curious I So guys being exchange big QX. in that

Shrikant Sortur

because of cash flows interest dot, fair, the right. quarter. That's QX. resulted positive kind This quarter the additional if the that's prepayment. Traditionally, of in a in Right, can key cash post the QX of offer exchange that the cash change. it time, out impacting interest you prepayment was And operating not is flow

Zach Cummins

are you're stabilizing be trending you term metrics the that the from should for Understood. new terms of we're of and not how but in outlook direction. a with relatively thinking we And right Or in we at the here, know I is that the seems looking least, at just giving formal key it thinking about you near here how this some assume should perspective? performance? top like business, that? Or top of guidance provided about all renewals line line

Shrikant Sortur

question. great a Again,

helped So accomplished common have if of my strengthening from of speak, to this even need performance. presentation probably which with in you operating a interrelates now going it, to is on lot us our We don't improve the We to listed But to work on in is the Between and strong to we from, of off areas, with turn, We right? so leverage right? threads, focus are breakout this, done sheet you performance. of there, market. on the the mind, which, balance the XXXX, a if our continue we discussion one is about in XXXX other, focused that sheet, a X a X think expanding balance operating come number X lot our the sheet, right growth are of balance there things year. where

renewals robust to up. Our beginning It's pick are pipeline.

modeling don't out can said, like gave from historical use -- you a that can you it, term a number, our want 'XX. I we historical if that in base And so for to the feel speak. XXX, free every of the perspective, you So you revenues XXX All for about -- been quarter modeling to use have range to in right? think XXXX,

Zach Cummins

on-site business margins, back So those of play XXXX? XXXX. Understood. in here see of gross especially nice just I'm going margins, to start there different And Is impact about in you're any as potentially how impacts. your kind gross on balance here margins more into gross to coming to I'm as of obviously, improvement you curious margin some thinking

Shrikant Sortur

In to watch challenges of pricing-related see so out the can management, this cost to focus of is potential from on Josh we capacity going these catered a inflationary and what perspective, are or words, I macro -- can pressures. is creep inflation for and all is control adjustments offsetting cost going the is we said, -- potential that towards mitigate headwind. I -- have cost we -- think to we're work-from-anywhere very other sorry, more That would cost continue model But to that, a and cloud, internally, creep all that carefully. a something cost Zach.

Zach Cummins

kind would here? Yes. have have liabilities, terms some problem. of can in of XXXX, upcoming some to you've in the maturities you quarter And the actions at from both about to near-term taken you the flexibility your speak of still of summary Yes. the for No of of finally, kind remaining disposal. with your some revolver, horizon but the some with of address you the that post the judgment know and different exchange other think on of the that the maturities rest aspects maturities I any manage how your don't you

Shrikant Sortur

other, If said, I to putting an analogy, going there see foot in down et of extending it, that. going no such. from To done what on in liquidity, maturities, are continue right? what action be we raising really appraisal to are as XXXX your obligations up shoring it's paying debt, to the RCF maturities tackling do one to payment, Again, you focused immediate our use front cetera, to back Sure. point, we've

it's a to for time to us be So to liquidity. build going continue our

Operator

from Capital Klein Randal Group. Avenue The comes question from next

Randal Klein

again, even my the the very would slightly were announced which as XXXX, the covered focus hanging balance the a of just got I on agree tell, I and in of as -- everything your guys far you mean couple including action, try head you over and different kind and and way. it bonds well the questions. to on appraisal I I'll sheet, was a loan. that with done, Maybe focused as fact be that obviously, seem Zach, revolver can his term

wrong, if the it, if I'm missing is mean done 'XX F I So balance it correct me like looks I'm sheet. on

couple priorities you and goals obviously, and level, of should 'XX? block you've are move both a that's case, as from else your is of kind anything focus well. covered key But high for if tackling somewhat your here? What the 'XX? mean, sheet what at I the a numbers, to in addressed thinking So we Shrikant, Ron, the you've balance of about the 'XX as be them

Shrikant Sortur

Again, question. Randal, for thanks, Yes. the

then Let me and take some that additional you can provide one color. first business

being used about on it, the of tuck-ins, building business repetitive average We leverage will in we pursuing any, Randal, if focus balance talent, large levels pre-COVID have you right? is right now, lot if important a base that customer think do XXX include that to sheet can what's upon for about strategic us happy for XXX adding growth. So operations revenue. still we XXXX, to around instead to That in

sheet, things revenue in becomes that course, have possible. we Of changed, more and mix the but have strong balance to go after XXXX. all a With

our and Ron, That's going in focus. up for growing you growth that's bottom key word, unlocking one part stabilizing the XXXX. to And line the line, going and want be to -- top in And lastly, value. Lastly, be to shareholder

Ron Cogburn

that's No, good. Shrikant. Good,

talent. rolled are the to that's draw will, surprise One all sort the of to things to us plan of all, it, solutions more map, And attention that of the pleasing platforms the platforms And SMB you we of the things incredible offered. #X, out road turned process, of going we've me Slide that out to that of with we're the 'XX to to if in is for in and we're your really we're the that than has And I help roll things we've with most and an and investing these business created then do. growth the We've consulting the data new be heavily, increasing accounting in And better market heard in adoption in invested talent. say then 'XX. solutions and going a out upgraded I drive think you services. our rolling the science, We've incentives. our practice, and out comp finance

for have us. meet be I we it mindset, move we're that and it's we of have to going be ready customers' the to us cloud think on that. And great expansion expectations. need we to allows use, So queue, to be year to and anywhere a And a a with the

Randal Klein

Got it.

with you'll because and you be extra dealing won't look, sheet have lawyers issues. Well, the time, Okay. the hopefully, That's the good. balance

spend the that? -- be time the Tuesday will can I like estimated I'm will have next get be incremental out from which to some You on probably detail what's by guess the Will the the XX-K. assuming or time business. hopefully, you whatever, on questions, XX-K value

Shrikant Sortur

are showing deadline March to that. we The XX is that file Yes.

Randal Klein

Okay.

Next week.

tried I New but I think businesses other already of Okay. about more think heard couple color, don't at you again, ago. And then obviously, lastly, York some were years about talking giving in M&A much a we've selling people than guess, I

Now be M&A need sell provide color. like you the else, doesn't like acquisitions. but it kind like on more color, I just sound before don't provide It can can sounds sounds that. of more if curious that not you may anything businesses, you know to long

Shrikant Sortur

open, a to targets. is From strategic options going keep I said, growth. investment insight, In we leg our as the identify our of growth, third strategy are

right, share long we But more then anything have developments as as then. we right is, that we'll don't something the So or anything will again, to talking is time now. is When strategic, that. share pursue

Operator

Our next Eric Stephens Capital. from from Gates comes question

Jeff Gates

ATM 'XX? is proceeds This in since raised much How actually of end you Yes. Jeff. have the

Shrikant Sortur

Since the this of quarter year, Jeff? end in first -- you this mean

Jeff Gates

XX your from is count like because Yes, the up right, million shares, share end?

Shrikant Sortur

don't. we you file But that the know our will find Jeff. subsequent should XX-K. probably the number, when in footnote I I Yes.

Jeff Gates

flow? the $XX How flow million number improvement then Okay. do about, what's of that And you're in cash you're define base using you cash the 'XX? talking

Shrikant Sortur

split past. other -- operational mainly million, The cash and It's global we facility and the is interest rest from facility then savings. $XX lease the and million and in It's of footprint and $XX then approximately savings. savings, savings have lease interest savings, disclosures

Jeff Gates

lease what your expense, expense And was lease XXXX? for your

Shrikant Sortur

On basis, for a consolidated Exela? of all

Jeff Gates

Yes.

Shrikant Sortur

maybe. I you the know, let can next one Jeff, look of up and after questions

Jeff Gates

fair be your And would the to would a then new the assume it that next -- financing facility? step in AR be

Shrikant Sortur

be zero want lower The of particular if know don't facility. interest I rates. I capital, to is on logic going any to lower simple, in cost

capital, of do we'll interest we our that cost facility So reduce that. any cost or can

Jeff Gates

talked you one And at contemplating Are sales asset asset Right. you any sales? about time.

Shrikant Sortur

in done I terms think have focus focusing right over is strategically we balance asset the now on cash and sales. the the improvement, what sheet raising on of year last Given don't

focus it, valuation consider we'll great makes comes sense, through. that's Some it not right strategic area definitely And a now. but if

Jeff Gates

of you've would that Okay. this back I'm asset for about 'XX? number And have $XXX 'XX. you What million think that then And been gave that of December number so. group being digital talked revenues just wondering, or in I

Shrikant Sortur

from that's but happy something of That's to we share digital reduced XXXX revenue X.X%. our groups. have in And that with that in revenue was asset not disclosed, I'm now 'XX, the X%

So in it's a similar range.

revenue Of course, million. to XXXX changes XXXX $XXX of to

in terms, dollar improve. So larger. have has But we the share as actually you it's that group imagine can continued to percentage terms, from revenue in

Jeff Gates

the what the last then last X you current you question, And be I it's quarters. the for with SG&A been my are -- ongoing what should think elevated run business pretty the do rate mean footprint?

Shrikant Sortur

quarters, we in X we right, and And last actually, were million the $XX 'XX, million. improved, XXXX, $XX million, elevated million. $XX was But $XX question. million, $XX million, in Jeff, great if a what compare again $XX $XX to million, you million, it That's $XX

Some costs in what QX I put right to Baseline, numbers are I $XX we -- fact XX to elevated those million. either that related the would guess, we onetime exchange professional out or legal the That you'll $XX still averaging includes and fees. say, 'XX, had of million And there. said, offer. sheet see

but in go those away of depend So to wrap structure on you all initiative. can capital all up discount we some it'll the when of future,

Jeff Gates

And bonds guess, point? in If they I equity SPD, could value, went you and corporate from value, if your some liquidity went a there -- release the up option sell is Okay. those then up is that at in XX.X% liquidity?

Shrikant Sortur

Theoretically, Whether do on we'll strategic that's yes. based intent. guess be something not, that it'll that or I

Operator

[Operator question from Our Longfellow. next from comes Carlozzi Craig Instructions]

Craig Carlozzi

great. recently? able end. a plan I your capital were to Just Most provide and liquidity or any think more you the anticipate XXXX, throughout a have be to capital then require when guess, at would to you be first, And couple do about raising here internally provide answered. structure, to both you I was your my need periodic liquidity know update quarter, times throughout would get at on more random you sustainable to that you two, year-end activity? be equity what where business from

Shrikant Sortur

Yes.

Liquidity was of there. point to question, a we quite there being able I been extensively what's the what in to first for out given time XXXX. time. was the liquidity But part a probably is in for point perception when asked sometimes needs accomplish whatever have For everyone think us in give credit

raised down liquidity had fact as down paid improve million structure. the think debt, in we our that I over $XXX paid continue to capital on we

take point start out in whatever to is away want up else liquidity, of cash. we you've a kind One, lot focus right? of time Having you'll building our there, the settled think obligations. met from I a

balance I it be we is sheet guess, on. what, the focusing at I'll all should So eventually leave liquidity that.

The one -- second

Craig Carlozzi

Before that Do at year-end on, Or be you something K? year-end, the What what move liquidity? you provide that have will on about about least in is or -- year-end? quarterly can your you

Shrikant Sortur

have time at the we I release liquidity restricted other the offer exchange cash why and again, No, point plus -- important including the interest million. Again, press yet of $XX between this sheet our right, interest, it at But not in hallmarks. of say it's if and in part that after offer Yes. time and other was at X is just meeting it's exchanges equivalents, for something cash is this the there, of determined. point look statements you and was prepayment balance on today, is obligations, level the this completing

Craig Carlozzi

Right.

unrestricted of liquidity $XX So look I That's and were kind million. it's look I the the cash, at to think your year-end if number? at

Shrikant Sortur

facility. under availability Plus Yes. the Yes.

Craig Carlozzi

facilities the at precision. I And other the under year-end? don't Ballpark, what need Shrikant. is availability

Shrikant Sortur

the If you're on? I'm address me of specific to contextually. to we let's a time. talk down, to what than is you're it What you up can the cost right? happy trying doing that be liquidity want could we more I about other talk If the initiatives with help solve, with or So of are in not do all need point trying to in because zero questions

Craig Carlozzi

picking equity and I and December But at there has question. part uses I flow been XX I asked to your of know fine. cash of sure down look the I'm in pressures I much revolver, uses the not raised you've to mean, pay time. cash, challenged. cash need that generation the sound are a I don't when internal specifically prior of at and Well, flow a of But business I'm cash, look the how QX. the point blunt. in at is caller I business I know random look not do

balance And But run equity is, maturities to much extending raises. good the I to so applaud the think that understand terrific, then and I that's what just comfortably. how and trying I of understand much business how don't know a sheet. liquidity job capital I'm And your you've you the done I liquidity need you all have

really that's nature question. the of So the

Shrikant Sortur

about we understood. Yes. You're we context, other and number you prepayments. appraisal Understood. be public consider way on did -- a it take your we What to a also send mindful XX/XX? some raise is talking pay we of -- message. right? the I point, out, we want But talk a what No, that right, did wrong much settlement about settlements sometimes call I action how didn't post When what need either. other else so that that, to to without say But very when

number a things So of there's involved.

to a formal time. XX-K filed not for into be out forum a numbers get So in right wait or at I the public we'll to the walk prefer rather put

Craig Carlozzi

answer then internal on And I plan you guess selling business cut off Okay. more I your your attempt to that. equity?

Shrikant Sortur

selling comes the statements, -- the unused point whatever to we we point that have put raised, equity between and equity, $XXX guess we we'll million debt again, have right, business to back more use. plan is Internal good of I have registration put equity. And

We to put do. we're production, going have what it good That to use. committed

all continue want to not strategic Whether to it's what to raise want being evasive we'll be but strategic. again, equity, intent, your to do it, So question, be do and do it's with to on going contextual. we we depending

Operator

from Alex next Cowen. Our from Graf comes question

Alex Graf

about and I X, you was the equity quarter, first throughout I a it raised private $XX.X the capital October, hoping million. disclosed then think And third quarter in in ATM X $XXX then X XXXX. the in believe Q, ATM to was around in just reconcile just million. And about you XX.X raises placement. I between

So roughly $XXX million total.

ATM it's think million, that Given sound million raised $XXX Does that another assume about I under your disclosure to so $XXX X. safe of you or right?

Shrikant Sortur

a On yes. Correct. Yes. gross basis,

Alex Graf

yes. left at then basis, implying X. XXX the a ATM had so of And end that you the probably gross year, around under On

year, how was usage, share the mean where In terms additional based do it count of can plans proceeds? March share kind the end the any anticipate I of off at using for kind the and count VWAP. given XX of was of the you back you additional into

far some I kind proceeds use about the So the guys those imagine ATM sure be tapping ballpark might and Not you $XX in that you curious of $XX kind paydown. million what of of would of so balance those just from if of went would think towards it the like looks that's have the first into how million potentially revolver But those. between you quarter. proceeds, or anticipate the anywhere in how raised to

Shrikant Sortur

Yes.

evasive the happen, a way. we you. on will covered put say it is is would I I for the want to emphasize, better prepayment I And that the question, right, and answer it figure going of of on that it's and it our think the kind I the you remains. being right? that which out dependent And I to are question, not yet our need. thing dodgy, of being only earlier to just if sources Yes. RCF, not uses So match gives

Alex Graf

between rates, see renewals? for is, there trying sense of taking contract how the grow type just better any of secondly, you X% Got Is to get breakdown renewal And point, Healthcare able market business? a just it. year-over-year the on then renewals? for and I LLPS place discounting to to is your number. to what's on great are What kind competitive values? ITPS, Or was And the retain of the that

Ron Cogburn

Ron. This is

we our Alex, may you market. the And you pressure question, the the renewal, with to don't in have if make last me mind. Let help that

Alex Graf

Sure.

Ron Cogburn

One with… of slides our that deals

Shrikant Sortur

sorry to Ron, interrupt.

phone. there some your is think I static with

Ron Cogburn

you me better Can hear Sorry. now?

Shrikant Sortur

Yes.

Ron Cogburn

Sorry.

Sorry, microphone malfunction. Alex,

like things is we top -- One folks XX the of point to customers. that XX the toward

customers, average of the tenure years. those you look it's about So XX if at

as and gone many, cycles. renewal many go Some we high XX through as years, have

and we So it called land our expand. strategy,

that You've in that heard me things talk the work, we are the past. of new with These to new agreements. master do statements about service try

and we've along typically, up come that so with. a customers longer multiple we we got tenure, And renewal, have larger statements come dealing the to that work as for of we're

combination to it bit more and little a makes little our stickier. of it disengage. It expensive solutions a makes So services bit

we it up sure, things on our out but we have come we in we pressures. services, experience some by challenges additional we of some there, against any So overcome we pricing the those and with And call do when side pricing. sometimes like have market of that, those adding the bundled today

to plan against in end that day, that historically the the of that help? how how Does place into 'XX of then. and hedged on at we've with we kind So renewals that that's would come work

Alex Graf

that. certainly yes. Appreciate very helpful, That's

Operator

to remarks. Cogburn over any closing like session. This for turn concludes conference I'd Ronald the question-and-answer to our back

Ron Cogburn

want we we really for the really today, all and in And questions. Thanks. appreciate participating call thank the everybody to

is And we with again, you. just reach filed, As may up answer course, private speaking with quarter your forward questions. always, at out like and we'll folks you with soon. Investor Relations you when group, us of the XX-K and the if first be to information one-on-one on set basis, Thanks some questions the have to look call and of those Bye. to you Thank would further or a talk our a answered. on

Operator

you today's for attending The concluded. conference has Thank presentation. now

disconnect. now may You

Exela (XELA) 11 Mar 222021 Q4 Earnings call transcript