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Published: 2022-02-17 16:32:21 ET
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EX-99.1 2 tm227056d1_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

February 17, 2022

 

Globant Reports 2021 Fourth Quarter and Full Year Financial Results

Strong End to the Year and Robust Outlook

 

Fourth quarter revenues of $379.8 million, up 63.3% year-over-year

IFRS Diluted EPS of $0.68 for the fourth quarter

Non-IFRS Diluted EPS of $1.07 for the fourth quarter

 

Full year 2021 revenues of $1,297.1 million, up 59.3% year-over-year

IFRS Diluted EPS of $2.28 for the full year

Non-IFRS Diluted EPS of $3.76 for the full year

 

NEW YORK / February 17, 2022 - Globant (NYSE: GLOB), a digitally native technology services company, today announced results for the three months and year ended December 31, 2021.

 

Please see highlights below, including certain Non-IFRS measures. Note that reconciliations between Non-IFRS financial measures and IFRS operating results are disclosed at the end of this press release.

 

Fourth Quarter 2021 Financial Highlights

 

·Revenues rose to $379.8 million, representing 63.3% year-over-year growth.
·IFRS Gross Profit Margin was 38.0% compared to 38.2% in the fourth quarter of 2020.
·Non-IFRS Adjusted Gross Profit Margin was 39.4% compared to 39.6% in the fourth quarter of 2020.
·IFRS Profit from Operations Margin was 11.5% compared to 11.7% in the fourth quarter of 2020.
·Non-IFRS Adjusted Profit from Operations Margin was 16.7% compared to 16.3% in the fourth quarter of 2020.
·IFRS Diluted EPS was $0.68 compared to $0.46 in the fourth quarter of 2020.
·Non-IFRS Adjusted Diluted EPS was $1.07 compared to $0.68 in the fourth quarter of 2020.

 

Full year ended December 31, 2021 Financial Highlights

 

·Revenues rose to $1,297.1 million, representing 59.3% year-over-year growth.
·IFRS Gross Profit Margin was 38.2% compared to 37.4% for the full year 2020.
·Non-IFRS Adjusted Gross Profit Margin was 39.5% compared to 39.1% for the full year 2020.
·IFRS Profit from Operations Margin was 11.1% compared to 10.3% for the full year 2020.
·Non-IFRS Adjusted Profit from Operations Margin was 16.5% compared to 15.2% for the full year 2020.
·IFRS Diluted EPS was $2.28 compared to $1.37 for the full year 2020.
·Non-IFRS Adjusted Diluted EPS was $3.76 compared to $2.28 for the full year 2020.

 

 

 

 

Other Metrics as of and for the quarter ended December 31, 2021

 

·Cash and cash equivalents and Short-term investments were $460.4 million as of December 31, 2021, an increase of $162.2 million from $298.2 million as of December 31, 2020. As of December 31, 2021, our credit facility was fully undrawn.
·Globant completed the fourth quarter of 2021 with 23,526 Globers, 22,167 of whom were technology, design and innovation professionals.
·The geographic revenue breakdown for the fourth quarter of 2021 was as follows: 63.9% from North America (top country: US), 23.5% from Latin America and others (top country: Chile), 10.7% from Europe (top country: Spain) and 1.9% from Asia (top country: India).
·In terms of currencies, 73.4% of Globant’s revenues for the fourth quarter of 2021 were denominated in US dollars.
·During the twelve months ended December 31, 2021, Globant served 1,138 customers and continued to increase its wallet share, having 185 accounts generating more than $1 million of annual revenues, compared to 129 for the same period one year ago.
·Globant’s top customer, top five customers and top ten customers for the fourth quarter of 2021 represented 11.0%, 26.8% and 37.6% of revenues, respectively.

 

“2021 was one of our most transformative years ever. We became a billion-dollar-revenue company for the first time.” said Martín Migoya. “We aim to be the partner-of-choice for our clients, and to help them bridge the gap between the innovation opportunities and actionable transformation. We are executing this strategy through the pillars of growth that I laid out in 2021: our geographic expansion, our reinvention studios and our growing platforms.”

 

“We are delighted to end 2021 with very strong fourth quarter top and bottom line beats. Our business was robust throughout the year, with 2021 revenues up 59.3% year over year, our strongest growth, by far, since we became a public company. 2021 Adjusted Diluted EPS growth was even stronger at 65.1% year over year, as our robust gross margins and SGA efficiencies boosted operating margins. We also had a great year hiring strong talent across the globe. The demand environment and our pipeline remain strong, helping us provide very strong first quarter and full year 2022 guidance, and giving us confidence that Globant can maintain industry leading growth trends in the coming years,” explained Juan Urthiague, Globant’s CFO.

 

2022 First Quarter and Full Year Outlook

 

Based on current market conditions, Globant is providing the following estimates for the first quarter and the full year of 2022:

 

·First quarter 2022 Revenues are estimated to be at least $395 million, implying at least 46.2% year-over-year growth.
·First quarter 2022 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 16%-17%.
·First quarter 2022 Non-IFRS Adjusted Diluted EPS is estimated to be at least $1.16 (assuming an average of 42.9 million diluted shares outstanding during the first quarter).
·Fiscal year 2022 Revenues are estimated to be at least $1,751 million, implying at least 35.0% year-over-year revenue growth.
·Fiscal year 2022 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 16%-17%.
·Fiscal year 2022 Non-IFRS Adjusted Diluted EPS is estimated to be at least $4.86 (assuming an average of 43.1 million diluted shares outstanding during 2022).

 

 

 

 

Conference Call and Webcast

 

Martín Migoya and Juan Urthiague will discuss the fourth quarter 2021 results in a video conference call today beginning at 4:30pm ET.

 

Video conference call access information is:

https://more.globant.com/F4Q21EarningsCall

Webcast http://investors.globant.com/

 

About Globant (NYSE:GLOB)

 

We are a digitally native company that helps organizations reinvent themselves to create a way forward and unleash their potential. We are the place where innovation, design and engineering meet scale.

 

We have more than 23,500 employees and we are present in 18 countries working for companies like Google, Rockwell Automation, Electronic Arts and Santander, among others.

 

We were named a Worldwide Leader in CX Improvement by IDC MarketScape report. We were also featured as a business case study at Harvard, MIT and Stanford. We are a member of the Cybersecurity Tech Accord.

 

For more information, please visit www.globant.com

 

Non-IFRS Financial Measures

 

While the financial figures included in this press release have been computed in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), this announcement does not contain sufficient information to constitute an interim financial report as defined in International Accounting Standards 34, “Interim Financial Reporting” nor a financial statement as defined by International Accounting Standards 1 “Presentation of Financial Statements”. The financial information in this press release has not been audited.

 

Globant provides non-IFRS financial measures in addition to reported IFRS results prepared in accordance with IFRS. Management believes these measures help illustrate underlying trends in the company's business and uses the non-IFRS financial 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 measures that exclude share-based compensation expense, depreciation and amortization, impairment of non-financial assets, acquisition-related charges, COVID-19 related expenses and the related effect on income taxes of the pre-tax adjustments. Because the company's 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 statements of financial position as of December 31, 2021 and 2020 and its consolidated statement of comprehensive income for the three months and year ended December 31, 2021 and 2020, prepared in accordance with IFRS as issued by IASB.

 

 

 

 

Globant is not providing a quantitative reconciliation of forward-looking Non-IFRS Adjusted Profit from Operations Margin or Non-IFRS Adjusted Diluted EPS to the most directly comparable IFRS measure because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items without unreasonable effort. These items include, but are not limited to, share-based compensation expense, impairment of assets, acquisition-related charges COVID-19 related expenses and the tax effect of non-IFRS adjustments. These items are uncertain, depend on various factors, and could have a material impact on IFRS reported results for the guidance period.

 

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. In some cases, you can identify forward-looking statements by terminology such as “believe,” “may,” “will,” “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 our future financial and operating performance, including our outlook and guidance, and our strategies, priorities and business plans. Our expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could impact our actual results include: the impact and duration of the COVID-19 pandemic; our ability to maintain current resource utilization rates and productivity levels; our ability to manage attrition and attract and retain highly-skilled IT professionals; our ability to accurately price our client contracts; our ability to achieve our anticipated growth; our ability to effectively manage our rapid growth; our ability to retain our senior management team and other key employees; our ability to continue to innovate and remain at the forefront of emerging technologies and related market trends; our ability to retain our business relationships and client contracts; our ability to manage the impact of global adverse economic conditions; our ability to manage uncertainty concerning the instability in the current economic, political and social environment in Latin America; and other factors discussed under the heading “Risk Factors” in our most recent Form 20-F filed with the U.S. Securities and Exchange Commission and any other risk factors we include in subsequent reports on Form 6-K.

 

Because of these uncertainties, you should not make any investment decisions based on our 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 Comprehensive Income

(In thousands of U.S. dollars, except per share amounts, unaudited)

 

   Year ended   Three Months Ended 
   December 31,
2021		   December 31,
2020		   December 31,
2021		   December 31,
2020		 
Revenues   1,297,078    814,139    379,817    232,636 
Cost of revenues   (802,090)   (509,812)   (235,499)   (143,723)
Gross profit   494,988    304,327    144,318    88,913 
                     
Selling, general and administrative expenses   (343,004)   (217,222)   (99,638)   (61,972)
Net impairment losses on financial assets   (7,551)   (3,080)   (1,035)   445 
Other operating income and expenses, net   —    (83)   (11)   (83)
Profit from operations   144,433    83,942    43,634    27,303 
                     
Finance income   652    1,920    178    543 
Finance expense   (12,708)   (10,430)   (4,206)   (2,991)
Other financial results, net   (3,923)   3,601    (1,092)   1,429 
Financial results, net   (15,979)   (4,909)   (5,120)   (1,019)
                     
Share of results of investment in associates   (233)   (622)   —    (247)
                     
Other income and expenses, net   (3,369)   (1,887)   (482)   1,737 
Profit before income tax   124,852    76,524    38,032    27,774 
                     
Income tax   (28,497)   (22,307)   (8,901)   (9,085)
Net income for the year   96,355    54,217    29,131    18,689 
                     
- Exchange differences on translating foreign operations   (3,733)   (398)   (1,106)   2,141 
- Net change in fair value on financial assets measured at FVOCI   1    —    19    — 
- Gains and losses on cash flow hedges   11    281    (662)   1,129 
Total comprehensive income for the year   92,634    54,100    27,382    21,959 
                     
Net income attributable to:                    
Owners of the Company   96,065    54,217    28,973    18,689 
Non-controlling interest   290    —    158    — 
Net income for the year   96,355    54,217    29,131    18,689 
                     
Total comprehensive income for the year attributable to:                    
Owners of the Company   92,344    54,100    27,224    21,959 
Non-controlling interest   290    —    158    — 
Total comprehensive income for the year   92,634    54,100    27,382    21,959 
Earnings per share                    
Basic   2.35    1.41    0.69    0.47 
Diluted   2.28    1.37    0.68    0.46 
Weighted average of outstanding shares (in thousands)                    
Basic   40,940    38,515    41,697    39,713 
Diluted   42,076    39,717    42,833    40,914 

 

 

 

 

Globant S.A.

Consolidated Statements of Financial Position as of December 31, 2021 and December 31, 2020

(In thousands of U.S. dollars, unaudited)

 

   December 31,
2021		   December 31,
2020		 
ASSETS          
Current assets          
Cash and cash equivalents   427,804    278,939 
Investments   32,581    19,284 
Trade receivables   300,109    196,020 
Other assets   7,855    8,146 
Other receivables   49,194    31,633 
Other financial assets   2,057    1,577 
Total current assets   819,600    535,599 
           
Non-current assets          
Trade receivables   —    5,644 
Investments   1,027    615 
Other assets   8,583    6,954 
Other receivables   24,263    9,629 
Deferred tax assets   58,404    41,507 
Investment in associates   —    3,154 
Other financial assets   25,233    15,147 
Property and equipment   133,571    101,027 
Intangible assets   102,016    86,721 
Right-of-use asset   144,581    90,010 
Goodwill   572,959    392,760 
Total non-current assets   1,070,637    753,168 
TOTAL ASSETS   1,890,237    1,288,767 
           
LIABILITIES          
Current liabilities          
Trade payables   63,210    35,266 
Payroll and social security taxes payable   184,464    111,881 
Borrowings   10,305    907 
Other financial liabilities   63,059    19,822 
Lease liabilities   25,917    15,358 
Tax liabilities   18,071    11,804 
Income tax payable   20,318    10,511 
Other liabilities   955    81 
Total current liabilities   386,299    205,630 
           
Non-current liabilities          
Trade payables   6,387    5,240 
Borrowings   1,935    25,061 
Other financial liabilities   66,932    74,376 
Lease liabilities   108,568    72,240 
Deferred tax liabilities   1,289    13,698 
Income tax payable   877    — 
Contingent liabilities   9,637    12,583 
Total non-current liabilities   195,625    203,198 
TOTAL LIABILITIES   581,924    408,828 
           
Capital and reserves          
Issued capital   50,080    47,861 
Additional paid-in capital   872,030    541,157 
Other reserves   (6,395)   (2,674)
Retained earnings   389,660    293,595 
Total equity attributable to owners of the Company   1,305,375    879,939 
Non-controlling interests   2,938    — 
Total equity   1,308,313    879,939 
TOTAL EQUITY AND LIABILITIES   1,890,237    1,288,767 

 

 

 

 

Globant S.A.

Supplemental Non-IFRS Financial Information

(In thousands of U.S. dollars, unaudited)

 

   Twelve Months Ended   Three months ended 
   December 31,
2021		   December 31,
2020		   December 31,
2021		   December 31,
2020		 
Reconciliation of adjusted gross profit                    
Gross Profit   494,988    304,327    144,318    88,913 
Depreciation and amortization expense   14,122    9,759    4,640    2,430 
Share-based compensation expense   3,568    4,109    744    690 
Adjusted gross profit   512,678    318,195    149,702    92,033 
Adjusted gross profit margin   39.5%   39.1%   39.4%   39.6%
                     
Reconciliation of selling, general and administrative expenses                    
Selling, general and administrative expenses   (343,004)   (217,222)   (99,638)   (61,972)
Depreciation and amortization expense   48,796    22,691    13,670    7,232 
Share-based compensation expense   35,831    20,519    11,419    4,516 
Acquisition-related charges (a)   12,860    10,096    3,482    3,969 
COVID-19-related charges (b)   —    (613)   —    — 
Adjusted selling, general and administrative expenses   (245,517)   (164,529)   (71,067)   (46,255)
Adjusted selling, general and administrative expenses as % of revenues   (18.9)%   (20.2)%   (18.7)%   (19.9)%
                     
Reconciliation of Adjusted Profit from Operations                    
Profit from Operations   144,433    83,942    43,634    27,303 
Share-based compensation expense   39,399    24,628    12,163    5,206 
Impairment of tax credits   —    (8)   —    — 
Acquisition-related charges (a)   28,271    12,754    7,807    5,451 
COVID-19-related charges (b)   2,228    2,582    —    (169)
Impairment of assets   —    83    11    83 
Adjusted Profit from Operations   214,331    123,981    63,615    37,874 
Adjusted Profit from Operations margin   16.5%   15.2%   16.7%   16.3%
                     
Reconciliation of Net income for the period                    
Net income for the period   96,065    54,217    28,973    18,689 
Share-based compensation expense   39,399    24,628    12,163    5,206 
Impairment of tax credits   —    (8)   —    — 
Acquisition-related charges (a)   35,465    15,796    9,067    4,733 
COVID-19-related charges (b)   2,228    2,582    —    (169)
Impairment of assets   —    83    11    83 
Tax effect of non-IFRS adjustments (c)   (14,748)   (6,712)   (4,412)   (898)
Adjusted Net income   158,409    90,586    45,802    27,644 
Adjusted Net income margin   12.2%   11.1%   12.1%   11.9%
                     
Calculation of Adjusted Diluted EPS                    
Adjusted Net income   158,409    90,586    45,802    27,644 
Diluted shares   42,076    39,717    42,833    40,914 
Adjusted Diluted EPS   3.76    2.28    1.07    0.68 

 

(a)Acquisition-related charges include, when applicable, amortization of purchased intangible assets included in depreciation and amortization expense line on our consolidated statements of comprehensive income, external deal costs, acquisition-related retention bonuses, integration costs, changes in the fair value of contingent consideration liabilities, charges for impairment of acquired intangible assets and other acquisition-related costs. We cannot provide acquisition-related charges on a forward-looking basis without unreasonable effort as such charges may fluctuate based on the timing, size, and complexity of future acquisitions as well as other uncertainty inherent in mergers and acquisitions.

 

(b)COVID-19 related charges include, when applicable, bad debt provision related to the effect of COVID-19 on our customers businesses, donations and other expenses directly attributable to the pandemic that are both incremental to charges incurred prior to the outbreak and not expected to recur once the crisis has subsided and operations return to normal and clearly separable from normal operations. Moreover, these charges also include rent concessions that we were granted due to the pandemic environment.

 

(c)Non-IFRS adjusted net income and adjusted diluted EPS for Q4 of 2021 reflects the tax impact of non-IFRS adjustments. Non-IFRS adjusted net income and adjusted diluted EPS for Q4 2020, previously presented were recast to conform to the current presentation.

 

 

 

 

Globant S.A.

Schedule of Supplemental Information (unaudited)

 

Metrics  Q4 2020   Q1 2021   Q2 2021   Q3 2021   Q4 2021 
Total Employees   16,251    17,267    19,428    21,849    23,526 
IT Professionals   15,290    16,284    18,350    20,573    22,167 
                          
North America Revenues %   65.9    63.1    63.8    65.2    63.9 
Latin America and Others Revenues %   24.3    23.6    21.6    22.0    23.5 
Europe Revenues %   9.8    12.0    13.2    11.1    10.7 
Asia Revenues %        1.3    1.4    1.7    1.9 
                          
USD Revenues %   85.8    77.7    76.4    74.8    73.4 
Other Currencies Revenues %   14.2    22.3    23.6    25.2    26.6 
                          
Top Customer %   10.7    10.5    10.3    11.5    11.0 
Top 5 Customers %   30.0    28.4    26.4    27.6    26.8 
Top 10 Customers %   42.9    41.0    39.8    39.7    37.6 
                          
Customers Served (Last Twelve Months)   798    860    941    1,018    1,138 
Customers with >$1M in Revenues (Last Twelve Months)   129    139    154    162    185 

 

Investor Relations Contact:

Amit Singh, Globant

investors@globant.com

+1 (877) 215-5230

 

Media Contact:

Wanda Weigert, Globant

pr@globant.com

+1 (877) 215-5230

Source: Globant