Luxoft Holding, Inc
Luxoft Reports Results for First Quarter Fiscal 2019
LONDON, UK / ACCESSWIRE / August 15, 2018 / Luxoft Holding Inc. (NYSE: LXFT), a global IT service provider, today announced results for the three months ended June 30, 2018. Highlights – Three Months Ended June 30, 2018
Note: Reconciliations of non-GAAP to GAAP measures are included at the end of the release. “We’re off to a solid start this fiscal year with first quarter results largely ahead of our expectations,” said Dmitry Loschinin, Luxoft’s CEO and President. “We continue to transform our business through revenue diversification, allocation of resources to the highest-margin digital opportunities, and implementation of cost reduction efforts to strengthen our margin profile. Excluding Top Two accounts (DB & UBS)1, consolidated revenue increased 6.8% and Financial Services’ revenue increased 25.4%. This was our 14th consecutive quarter of over 20% year-over-year growth in Financial Services, excluding Top-Two accounts, which speaks to the increasing value of our solutions, current market trends and our continued path for long-term growth.” We continue to see strong growth in Automotive and are transforming our Digital Enterprise business with a focus on higher-margin disruptive technologies. To that end, we recently made two small, strategic acquisitions: Smashing Ideas, a design and innovation firm, and Objective Software, a tech-focused automotive software company. These acquisitions enhance our offerings and strength our position on the value chain. Mr. Loschinin concluded, “We are committed to executing on our strategic priorities for fiscal 2019. I am confident we are taking the right steps to build a strong foundation for long-term sustainable growth and increasing shareholder returns. To the end, we have returned $20 million directly to shareholders via our share repurchase program announced in April.”
First Quarter Key Operating Highlights
Second Quarter Fiscal 2019 Outlook
Conference Call Information The Company will host a conference call to review the results on Wednesday, August 15th, 2018 at 8:00 a.m. ET. To participate, please dial 877-407-8293 or 201-689-8349 (outside the U.S.) or access the live webcast here. A replay will be available two hours after the call at http://investor.luxoft.com or by dialing 877-660-6853 or 201-612-7415 (outside the U.S.) and entering the conference ID 13681539. The replay will be available until August 29, 2018. About Luxoft Luxoft (NYSE:LXFT) is a global IT service provider of innovative technology solutions that delivers measurable business outcomes to multinational companies. Its offerings encompass strategic consulting, custom software development services, and digital solution engineering. Luxoft enables companies to compete by leveraging its multi-industry expertise in the financial services, automotive, communications, and healthcare & life sciences sectors. Its managed delivery model is underpinned by a highly-educated workforce, allowing the Company to continuously innovate upwards on the technology stack to meet evolving digital challenges.
Luxoft has over 12,700 employees across 42 cities in 21 countries within five continents, with its operating headquarters office in Zug, Switzerland. For more information, please visit www.luxoft.com. Media Inquiries
Non-GAAP Financial Measures To supplement our financial results presented in accordance with US GAAP, this press release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: earnings before interest, tax, depreciation and amortization (EBITDA); adjusted EBITDA; non-GAAP net income; non-GAAP diluted Earnings per share (EPS) and Free Cash Flow (FCF). EBITDA is calculated as earnings before interest, tax, depreciation and amortization, where interest includes unwinding of the discount rate for contingent liabilities. Non-GAAP net income and non-GAAP EPS exclude stock-based compensation expense, amortization of fair value adjustments to intangible assets and impairment thereof and other acquisitions related costs that may include changes in the fair value of contingent consideration liabilities. Non-GAAP diluted EPS are calculated as non-GAAP net income divided by weighted average number of diluted shares. Free Cash Flow is calculated as operating cash flow less capital expenditure which consists of purchases of property, plant and equipment and intangible assets as defined in the cash flow statement. We adjust our non-GAAP financial measures to exclude stock based compensation, because it is a non-cash expense. We also adjust our non-GAAP financial measures to exclude the change in fair value of contingent consideration, because we believe these expenses are not indicative of what we consider to be normal course of operations. Our non-GAAP financial measures are adjusted to exclude amortization of purchased intangible assets in order to allow management and investors to evaluate our results from operating activities as if these assets have been developed internally rather than acquired in a business combination. Finally, we adjust our non-GAAP financial measures to exclude acquisition-related costs, which comprise payments to consulting firms as well as fees paid upon successful completion of acquisition; as well as certain incentive payments for members of management of the acquired companies as provided for in the acquisition agreements. These payments are based on performance of the acquired businesses and are classified as part of management compensation rather than part of purchase consideration. These costs vary with the size and complexity of each acquisition and are generally inconsistent in amount and frequency, and therefore, we believe that they may not be indicative of the size and volume of future acquisition-related costs. We provide these non-GAAP financial measures because we believe that they present a better measure of our core business and management uses them internally to evaluate our ongoing performance. Accordingly, we believe that these non-GAAP measures are useful to investors in enhancing and understanding of our operating performance. These non-GAAP measures should be considered in addition to, and not as a substitute for, comparable US GAAP measures. The non-GAAP results and a full reconciliation between US GAAP and non-GAAP results are provided in the accompanying tables at the end of this press release. 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 and in each of our industry verticals, application outsourcing and custom application development and offshore research and development services; the level of growth of demand for our services from our clients; the level of increase in revenue from our new clients; seasonal trends and the budget and work cycles of our clients; general economic and business conditions in our locations, including geopolitical instability and social, economic or political uncertainties, particularly in Russia and Ukraine, and any potential sanctions, restrictions or responses to such conditions imposed by some of 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 expected timing of the increase in our corporate tax rate, or actual
increases to our effective tax rate which we may experience from time to time; our expectations with respect to the proportion of our fixed price contracts; 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; our plans to introduce new products for commercial resale and licensing in addition to providing services; our anticipated joint venture with one of our clients; and our continued financial relationship with IBS Group Holding limited and its subsidiaries including expectations for the provision and purchase of services and purchase and lease of equipment; and other factors discussed under the heading “Risk Factors” in the Annual Report on Form 20-F for the year ended March 31, 2018 and other documents filed with or furnished to the Securities and Exchange Commission. 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. 1Top two accounts are UBS and Deutsche Bank and are included in our Financial Services line of business. CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of US dollars, except share amounts)
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands of US dollars, except share and per share amounts)
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
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Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Measures (Unaudited)
(In thousands of US dollars, except per share amounts and percentages)
Luxoft Holding, Inc
Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Measures (Unaudited)
(In thousands of US dollars, except per share amounts and percentages)
Schedule of supplemental information
(Unaudited)
(In thousands; except percentages)
Reconciliations of Non-GAAP Forward-looking Financial Measures
to Comparable GAAP Forward-looking Measures
(Unaudited)
(In thousands of US dollars, except share, per share amounts and percentages)
SOURCE: Luxoft Holding Inc.
08/15/2018 EQS Newswire / EQS Group AG |