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Globant Reports 2015 Fourth Quarter and Full Year Financial Results
Acceleration in Revenue Growth, Strong EPS

SAN FRANCISCO, Feb. 17, 2016 /PRNewswire/ -- Globant (NYSE: GLOB), a digitally-native technology services company focused on creating digital journeys, today announced results for the three and twelve months ended December 31, 2015.

Globant Logo

Full Year 2015 Highlights

  • Revenue for the full year increased to $253.8 million, the company's highest annual revenue to date, representing 27.2% year-over-year growth.
  • Non-IFRS Adjusted Gross Profit for the full year was $98.7 million (38.9% Non-IFRS Adjusted Gross Profit Margin), an increase of $16.9 million compared to $81.7 million (and a decrease of 210 bps compared to 41.0% Non-IFRS Adjusted Gross Profit Margin) in 2014.
  • Non-IFRS Adjusted Net Income for the full year was $34.3 million (13.5% Non-IFRS Adjusted Net Income Margin), an increase of $8.5 million compared to $25.9 million (13.0% Non-IFRS Adjusted Net Income Margin) in 2014, representing 32.7% year-over-year growth.
  • Non-IFRS Adjusted Diluted EPS for the full year was $0.98 per share (based on 35.0 million average diluted shares for the year), an increase of $0.17 compared to $0.81 per share in 2014.

Fourth Quarter 2015 Highlights

  • Revenue for the fourth quarter amounted to $71.6 million, representing 29.8% year-over-year growth.
  • Non-IFRS Adjusted Gross Profit for the fourth quarter was $28.1 million (39.2% Non-IFRS Adjusted Gross Profit Margin), an increase of 20 bps compared to the third quarter of 2015 and a decrease of 50 bps compared to the fourth quarter of 2014. 
  • Non-IFRS Adjusted Net Income for the fourth quarter was $9.0 million (12.6% Non-IFRS Adjusted Net Income Margin), an increase of $0.9 million, or 10.8%, compared to a profit of $8.1 million for the fourth quarter of 2014.
  • Non-IFRS Adjusted Diluted EPS for the fourth quarter was $0.26 per share (based on 35.2 million average diluted shares for the quarter), an increase of $0.02 compared to Non-IFRS Adjusted Diluted Profit per Share of $0.24 for the fourth quarter of 2014.

Reconciliations between Non-IFRS / adjusted financial measures and IFRS operating results are included at the end of this press release.

"I am very excited by our 2015 performance. Our revenues increased to $253.8 million, a robust 27.2% increase compared to 2014, driven by strong growth in our top accounts and increasing demand for our digital journeys. At the same time we delivered strong Adjusted EPS for the full year, reaching $0.98 cents.

Market demand for our services remains strong. Our revenue increased 29.8% during this quarter compared to the fourth quarter of 2014. Our top customer revenues increased 88% compared to a year ago and exceeded $31 million during 2015," explained Martín Migoya, Globant's CEO and co-founder.

Migoya added: "Industry experts suggest that the move towards "Digital" will be a secular change for the IT Services. The use of Emerging Technologies to transform businesses has become a requirement for large organizations in today's competitive environment, which is what we reflect in our newly launched book, The Never Ending Digital Journey. Globant, with its vast experience creating digital journeys that matter for millions of consumers combined with its studio model, continues to be at the forefront of these trends. We believe our compelling value proposition in the digital space will continue to be a strategic advantage for our company going forward."

"Q4 2015 and full year revenues and EPS exceeded our expectations once again. Positive macro trends combined with solid execution translated into another successful year for our company. The strong net additions of Globers coupled with a slight reduction in attrition place us in a solid position to have a great 2016." explained Alejandro Scannapieco, Globant's CFO.

Globant completed the quarter with 5,041 Globers, 4,613 of whom were IT professionals. The geographic revenue breakdown for the fourth quarter was as follows: 81.7% from North America (top country: U.S.), 12.2% from Latin America and others (top country: Chile) and 6.0% from Europe (top country: U.K.). 93.2% of Globant's revenue for the fourth quarter was denominated in U.S. dollars and G.B. pounds and the remaining 6.8% was in other currencies.

During the 12 months ended December 31, 2015, Globant served 344 customers, 51 of which accounted for more than $1 million of Globant's revenues.  Globant's top customer, top 5 customers and top 10 customers represented 12.7%, 34.4% and 46.4% of the fourth quarter revenues, respectively.

Cash and investments as of December 31, 2015 increased to $62.4 million from $62.2 million as of December 31, 2014, while borrowings decreased to $0.5 million compared to $1.3 million as of December 31, 2014. Current assets amounted to $127.8 million, accounting for 57.4% of total assets. As of December 31, 2015 there were 34.2 million common shares issued and outstanding.

2016 First Quarter and Full Year Outlook

Based on current market conditions, Globant is providing the following estimates for the first quarter and for the full year 2016:

  • First quarter revenue is estimated to be between $69 - $71 million
  • First quarter Non-IFRS diluted EPS is estimated to be in the range of $0.21 - $0.25 (assuming 35.3 million average diluted shares outstanding for the quarter).
  • Fiscal year 2016 revenue is estimated to be between $305- $314 million
  • Fiscal year 2016 Non-IFRS diluted EPS is estimated to be in the range of $1.12 - $1.20 (assuming 35.8 million average diluted shares outstanding for the full year).

Conference Call and Webcast

Martín Migoya and Alejandro Scannapieco will discuss the three-month results in a conference call today beginning at 4:30pm ET.

Conference call access information is:
US +1 (888) 346-2877
International +1 (412) 902-4257
Webcast: http://investors.globant.com

Additionally, a replay will be available via the same dial-in information and in our investor relations website after the call.

About Globant

Globant (NYSE: GLOB) is a digitally native technology services company. We dream and build digital journeys that matter to millions of users. We are the place where engineering, design, and innovation meet scale. Today, Globant has more than 5,000 professionals in 11 countries working for companies like Google, eBay Classifieds Group, JWT, EA and Coca-Cola, among others, has been recognized as one of the Top 10 Most Innovative Companies in South America by FastCompany, was included in the 2010 Cool Vendor in Business Process Services Report by Gartner, and has been featured in case studies at Harvard, MIT and Stanford.  For more information visit www.globant.com.

Non-IFRS Financial Information

Globant provides non-IFRS financial measures to complement reported IFRS results. Management believes these measures help illustrate underlying trends in the company's business and uses the measures to establish budgets and operational goals, communicated internally and externally, for managing the company's business and evaluating its performance. The company anticipates that it will continue to report both IFRS and certain non-IFRS financial measures in its financial results, including non-IFRS results that exclude share-based compensation expense, amortization of purchased intangible assets, and provisions resulting from changes in valuation allowances. Because the company's reported non-IFRS financial measures are not calculated according to IFRS, these measures are not comparable to IFRS and may not necessarily be comparable to similarly described non-IFRS measures reported by other companies within the company's industry. Consequently, Globant's non-IFRS financial measures should not be evaluated in isolation or supplant comparable IFRS measures, but, rather, should be considered together with its consolidated financial statements, which are prepared according to IFRS.

Forward Looking Statements

In addition to historical information, this release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements include information about possible or assumed future results of our business and financial condition, as well as the results of operations, liquidity, plans and objectives. In some cases, you can identify forward-looking statements by terminology such as "believe," "may," "estimate," "continue," "anticipate," "intend," "should," "plan," "expect," "predict," "potential," or the negative of these terms or other similar expressions. These statements include, but are not limited to, statements regarding: the persistence and intensification of competition in the IT industry; the future growth of spending in IT services outsourcing generally, application outsourcing and custom application development and offshore development services; the level of growth of demand for our services from our clients; the level of increase in revenues from our new clients; the resource utilization rates and productivity levels, the level of attrition of our IT professionals; the pricing structures we use for our client contracts; general economic and business conditions in the locations in which we operate; the levels of our concentration of revenues by vertical, geography, by client and by type of contract in the future; the continuity of the tax incentives available for software companies with operations in Argentina; Argentina's regulations on proceeds from the export of services; our expectation that we will be able to integrate and manage the companies we acquire and that our acquisitions will yield the benefits we envision; the demands we expect our rapid growth to place on our management and infrastructure; the sufficiency of our current cash, cash flow from operations, and lines of credit to meet our anticipated cash needs; the high proportion of our cost of services comprised of personnel salaries; and other factors discussed under the heading "Risk Factors" in the final prospectus for our initial public offering and other documents filed with the Securities and Exchange Commission.

These forward-looking statements involve various risks and uncertainties. Although the registrant believes that its expectations expressed in these forward-looking statements are reasonable, its expectations may turn out to be incorrect. The registrant's actual results could be materially different from its expectations. In light of the risks and uncertainties described above, the estimates and forward-looking statements discussed might not occur, and the registrant's future results and its performance may differ materially from those expressed in these forward-looking statements due to, inclusive, but not limited to, the factors mentioned above. Because of these uncertainties, you should not make any investment decision based on these estimates and forward-looking statements.  Except as required by law, we undertake no obligation to publicly update any forward-looking statements for any reason after the date of this press release whether as a result of new information, future events or otherwise.

 

Globant S.A.
Consolidated Statement of Profit or Loss and Other Comprehensive Income
(In thousands of U.S. dollars, except per share amounts, unaudited)
















Twelve months ended


Three months ended






December 31,
2015


December 31,
2014


December 31,
2015


December 31,
2014















Revenues 



253,796


199,605


71,563


55,117



Cost of revenues 



(160,292)


(121,693)


(44,811)


(34,360)



Gross profit



93,504


77,912


26,752


20,757















Selling, general and administrative expenses 



(71,594)


(57,288)


(19,471)


(15,852)



Impairment of tax credits, net



1,820


1,505


-


2,326



Profit from operations



23,730


22,129


7,281


7,231















Gain on transactions with bonds 



19,102


12,629


5,771


2,606



Finance income



27,555


10,269


17,247


2,192



Finance expense



(20,952)


(11,213)


(12,434)


(1,488)



Finance expense, net



6,603


(944)


4,813


704















Other income and expenses, net



605


380


616


430



Profit before income tax



50,040


34,194


18,481


10,971















Income tax



(18,420)


(8,931)


(10,169)


(2,823)



Net income for the period



31,620


25,263


8,312


8,148















Other comprehensive loss net of income tax












Items that may be reclassified subsequently to profit and loss:












- Exchange differences on translating foreign operations



(1,353)


(433)


(57)


(261)



- Net fair value gain on available-for-sale financial assets



52


-


52


-



Total comprehensive income for the period



30,319


24,830


8,307


7,887















Net income attributable to:












Owners of the Company



31,653


25,201


8,345


8,143



Non-controlling interest



(33)


62


(33)


5



Net income for the period



31,620


25,263


8,312


8,148















Total comprehensive income for the period attributable to:












Owners of the Company



30,352


24,768


8,340


7,882



Non-controlling interest



(33)


62


(33)


5



Total comprehensive income for the period



30,319


24,830


8,307


7,887



























Earnings per share 












Basic



0.93


0.81


0.24


0.24



Diluted



0.90


0.79


0.24


0.24



Weighted average of outstanding shares (in thousands)












Basic



33,960


30,926


34,177


33,374



Diluted



35,013


31,867


35,230


34,315















Globant S.A.
Consolidated Statement of Financial Position
(In thousands of U.S. dollars, unaudited)













Dec 31, 2015


Dec 31, 2014




ASSETS









Current assets









Cash and cash equivalents 



36,720


34,195




Investments



25,660


27,984




Trade receivables



45,952


40,056




Other receivables 



18,570


14,253




Other financial assets



900






Total current assets



127,802


116,488













Non-current assets









Other receivables 



20,122


916




Deferred tax assets



7,878


4,881




Long-term investments



300


750




Other financial assets



1,221


-




Property and equipment



25,720


19,213




Intangible assets



7,209


6,105




Goodwill



32,532


12,772




Total non-current assets



94,982


44,637




TOTAL ASSETS



222,784


161,125













LIABILITIES









Current liabilities









Trade payables 



4,436


5,673




Payroll and social security taxes payable



25,551


20,967




Borrowings



280


513




Other financial liabilities



6,240


1,045




Tax liabilities



10,120


3,446




Other liabilities 



9


173




Total current liabilities



46,636


31,817













Non-current liabilities









Borrowings



268


772




Other financial liabilities



15,045


263




Provisions for contingencies



650


794




Total non-current liabilities



15,963


1,829




TOTAL LIABILITIES



62,599


33,646













Capital and reserves









Issued and paid-in capital



41,050


40,324




Additional paid-in capital



51,854


50,276




Other reserves



(2,012)


(711)




Retained earnings



69,243


37,590




Total equity attributable to owners of the Company



160,135


127,479




Non-controlling interests



50


-




Total equity



160,185


127,479




TOTAL EQUITY AND LIABILITIES



222,784


161,125













Supplemental Non-IFRS Financial Information
(In thousands of U.S. dollars, unaudited)
















Twelve months ended


Three months ended






December 31,
2015


December 31,
2014


December 31,
2015


December 31,
2014















Reconciliation of adjusted gross profit












Gross Profit



93,504


77,912


26,752


20,757



Adjustments












D&A



4,441


3,813


1,094


1,162



Share Based Compensation



735


35


218


-



Adjusted gross profit



98,680


81,760


28,064


21,919



Adjusted gross profit margin



38.9%


41.0%


39.2%


39.8%















Reconciliation of selling, general and administrative expenses









Selling, general and administrative expenses



-71,594


-57,288


-19,471


-15,852



Adjustments












M&A Expenses



337




-


-



D&A



4,860


4,221


1,091


1,173



Share Based Compensation



1,647


582


501


-



Adjusted selling, general and administrative expenses


-64,750


-52,485


-17,879


-14,679



Adjusted selling, general and administrative expenses as % of revenues

-25.5%


-26.3%


-25.0%


-26.6%















Reconciliation of Adjusted Profit from Operations












Operating Profit



23,730


22,129


7,281


7,231



Adjustments












M&A Expenses



337









Impairment of tax credits



-1,820


-1,505


-


-2,326



Share Based Compensation



2,382


617


719


-



Adjusted Profit from Operations



24,629


21,241


8,000


4,905



Adjusted Operating Profit margin



9.7%


10.6%


11.2%


8.9%















Reconciliation of Net income (loss) for the period












Net income for the period



31,620


25,263


8,312


8,148



Adjustments












M&A Expenses



337









Share Based Compensation



2,382


617


719


-



Adjusted Net income 



34,339


25,880


9,031


8,148



Adjusted Net income margin



13.5%


13.0%


12.6%


14.8%















Calculation of Adjusted Diluted EPS












Adjusted Net income 



34,339


25,880


9,031


8,148



Diluted shares



35,013


31,867


35,230


34,315



Adjusted Diluted EPS



0.98


0.81


0.26


0.24















 

Globant S.A.
Schedule of Supplemental Information



















Metric

Q1 2014

Q2 2014

Q3 2014

Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015










Total Employees

3,332

3,371

3,567

3,775

4,040

4,512

4,724

5,041

IT Professionals

3,000

3,050

3,217

3,424

3,694

4,121

4,327

4,613










North America Revenue %

79.9

81.1

82.3

83.1

84.1

85.2

84.1

81.7

Latin America and Others Revenue % 

13.0

13.0

11.9

12.0

10.1

9.7

11.5

12.2

Europe Revenue %

7.1

6.0

5.8

4.9

5.8

5.1

4.4

6.0










USD Revenue %

88.9

91.8

93.5

94.6

95.0

94.6

93.3

90.8

GBP Revenue %

1.3

0.8

0.6

0.7

1.0

0.8

1.4

2.4

Other Currencies Revenue %

9.8

7.4

5.9

4.8

4.0

4.6

5.3

6.8










Top Customer %

7.1

10.1

8.8

8.8

10.2

12.3

13.4

12.7

Top 5 Customers %

25.4

29.0

29.2

28.9

30.8

32.8

33.2

34.4

Top 10 Customers %

39.8

44.8

46.2

44.8

47.8

47.7

45.9

46.4










LTM Customers Served

266

278

299

296

292

344

343

344

LTM Customers with >$1M in Revenue

42

42

45

46

43

43

47

51

 

Investor Relations Contact:
Juan Urthiague, Globant
investors@globant.com
(877) 215-5230

Media Contact:
Wanda Weigert, Globant
pr@globant.com
(877) 215-5230

Logo - http://photos.prnewswire.com/prnh/20120802/MX50844LOGO

SOURCE Globant


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