TTEC Holdings, Inc. [TTEC] Filings

10-Q 1 ttec-20240630x10q.htm 10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q


☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-11919

TTEC Holdings, Inc.

(Exact name of registrant as specified in its charter)


Delaware		84-1291044
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

6312 South Fiddler’s Green Circle, Suite 100N

Greenwood Village, Colorado 80111

(Address of principal executive offices)

Registrant’s telephone number, including area code: (303) 397-8100

Securities registered pursuant to Section 12(b) of the Act:


Title of each Class	Trading Symbol	Name of each exchange on which registered
Common stock of TTEC Holdings, Inc., $0.01 par value per share	TTEC	NASDAQ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large Accelerated Filer ☐	Accelerated Filer ☑	Non-accelerated Filer ☐	Smaller Reporting Company ☐
			Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☑

As of July 31, 2024, there were 47,723,922 shares of the registrant’s common stock outstanding.

Table of Contents

TTEC HOLDINGS, INC. AND SUBSIDIARIES

JUNE 30, 2024 FORM 10-Q

TABLE OF CONTENTS


		Page No.

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements

	Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023 (unaudited)	1

	Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 30, 2024 and 2023 (unaudited)	2

	Consolidated Statements of Stockholders’ Equity and Mezzanine Equity as of and for the three and six months ended June 30, 2024 and 2023 (unaudited)	3

	Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023 (unaudited)	4

	Notes to the Consolidated Financial Statements (unaudited)	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	38

Item 4.	Controls and Procedures	40

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	41

Item 1A.	Risk Factors	41

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41

Item 5.	Other Information	41

Item 6.	Exhibits	42

SIGNATURES		43

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

TTEC HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

(Amounts in thousands, except share amounts)

(Unaudited)


	June 30,		December 31,
	2024		2023
ASSETS
Current assets
Cash and cash equivalents	$	79,780	$	172,747
Accounts receivable, net of allowance of $4,757 and $2,248		381,685		394,868
Prepaids and other current assets		117,081		95,064
Income and other tax receivables		24,872		18,524
Total current assets		603,418		681,203

Long-term assets
Property, plant and equipment, net		149,114		191,003
Assets held for sale		29,449		—
Operating lease assets		106,185		121,574
Goodwill		573,625		808,988
Deferred tax assets, net		12,439		38,151
Other intangible assets, net		181,338		198,433
Income and other tax receivables, long-term		37,194		44,673
Other long-term assets		99,859		101,573
Total long-term assets		1,189,203		1,504,395
Total assets	$	1,792,621	$	2,185,598

LIABILITIES, STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	87,115	$	96,577
Accrued employee compensation and benefits		132,824		146,184
Other accrued expenses		48,268		32,217
Income tax payable		1,159		4,909
Deferred revenue		77,783		81,171
Current operating lease liabilities		35,650		38,271
Other current liabilities		4,857		3,698
Total current liabilities		387,656		403,027

Long-term liabilities
Line of credit		930,000		995,000
Deferred tax liabilities, net		13,277		3,137
Non-current income tax payable		—		—
Non-current operating lease liabilities		83,855		96,809
Other long-term liabilities		73,657		72,083
Total long-term liabilities		1,100,789		1,167,029
Total liabilities		1,488,445		1,570,056

Commitments and contingencies (Note 10)

Stockholders’ equity
Preferred stock; $0.01 par value; 10,000,000 shares authorized; zero shares outstanding as of June 30, 2024 and December 31, 2023		—		—
Common stock; $0.01 par value; 150,000,000 shares authorized; 47,608,318 and 47,427,200 shares outstanding as of June 30, 2024 and December 31, 2023, respectively		476		474
Additional paid-in capital		414,728		407,415
Treasury stock at cost; 34,443,935 and 34,625,053 shares as of June 30, 2024 and December 31, 2023, respectively		(586,812)		(589,807)
Accumulated other comprehensive income (loss)		(107,581)		(89,876)
Retained earnings		565,738		870,429
Noncontrolling interest		17,627		16,907
Total stockholders’ equity		304,176		615,542
Total liabilities, stockholders’ equity and mezzanine equity	$	1,792,621	$	2,185,598

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

TTEC HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (Loss)

(Amounts in thousands, except per share amounts)

(Unaudited)


	Three months ended June 30,				Six months ended June 30,
	2024		2023		2024		2023
Revenue	$	534,085	$	600,394	$	1,110,723	$	1,233,680

Operating expenses
Cost of services (exclusive of depreciation and amortization presented separately below)		417,890		464,686		871,708		947,364
Selling, general and administrative		73,726		75,338		148,301		149,348
Depreciation and amortization		25,071		24,946		50,216		50,773
Restructuring charges, net		5,095		1,474		5,344		3,527
Impairment losses		236,716		2,652		236,856		6,959
Total operating expenses		758,498		569,096		1,312,425		1,157,971

Income (loss) from operations		(224,413)		31,298		(201,702)		75,709

Other income (expense)
Interest income		414		1,126		1,397		2,290
Interest expense		(20,431)		(18,991)		(41,502)		(36,382)
Other income (expense), net		1,788		(3,574)		1,994		(2,919)
Total other income (expense)		(18,229)		(21,439)		(38,111)		(37,011)

Income (loss) before income taxes		(242,642)		9,859		(239,813)		38,698

Provision for income taxes		(54,126)		(6,102)		(56,455)		(14,024)

Net income (loss)		(296,768)		3,757		(296,268)		24,674

Net income (loss) attributable to noncontrolling interest		(2,771)		(2,546)		(5,576)		(4,816)

Net income (loss) attributable to TTEC stockholders	$	(299,539)	$	1,211	$	(301,844)	$	19,858

Other comprehensive income (loss)
Net income (loss)	$	(296,768)	$	3,757	$	(296,268)	$	24,674
Foreign currency translation adjustments		(7,381)		19,367		(11,218)		28,765
Derivative valuation, gross		(8,854)		712		(9,164)		9,573
Derivative valuation, tax effect		2,304		(187)		2,379		(2,497)
Other, net of tax		91		108		212		180
Total other comprehensive income (loss)		(13,840)		20,000		(17,791)		36,021
Total comprehensive income (loss)		(310,608)		23,757		(314,059)		60,695

Less: Comprehensive income attributable to noncontrolling interest		(2,779)		(2,560)		(5,490)		(4,385)

Comprehensive income (loss) attributable to TTEC stockholders	$	(313,387)	$	21,197	$	(319,549)	$	56,310

Weighted average shares outstanding
Basic		47,564		47,264		47,498		47,249
Diluted		47,623		47,453		47,585		47,417

Net income (loss) per share attributable to TTEC stockholders
Basic	$	(6.30)	$	0.03	$	(6.35)	$	0.42
Diluted	$	(6.29)	$	0.03	$	(6.34)	$	0.42

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

TTEC HOLDINGS, INC. AND SUBSIDIARIES

Consolidated Statements of Stockholders’ Equity and Mezzanine Equity

(Amounts in thousands)

(Unaudited)

Three months ended June 30, 2023 and 2024


	Stockholders’ Equity of the Company
								Accumulated
								Other
	Common Stock			Treasury		Additional		Comprehensive		Retained		Noncontrolling				Mezzanine
	Shares	Amount		Stock		Paid-in Capital		Income (Loss)		Earnings		interest		Total Equity		Equity
Balance as of March 31, 2023	47,252	$	473	$	(592,685)	$	391,294	$	(110,389)	$	905,309	$	16,836	$	610,838	$	3,936
Net income	—		—		—		—		—		1,209		2,486		3,695		61
Dividends to shareholders ($0.00 per common share)	—		—		—		—		—		—		—		—		—
Dividends distributed to noncontrolling interest	—		—		—		—		—		—		(2,520)		(2,520)		—
Foreign currency translation adjustments	—		—		—		—		19,293		—		74		19,367		—
Derivatives valuation, net of tax	—		—		—		—		525		—		—		525		—
Vesting of restricted stock units	24		—		379		(498)		—		—		—		(119)		—
Equity-based compensation expense	—		—		—		5,648		—		—		—		5,648		—
Other, net of tax	—		—		—		—		108		—		—		108		—
Balance as of June 30, 2023	47,276	$	473	$	(592,306)	$	396,444	$	(90,463)	$	906,518	$	16,876	$	637,542	$	3,997


	Stockholders’ Equity of the Company
								Accumulated
								Other
	Common Stock			Treasury		Additional		Comprehensive		Retained		Noncontrolling				Mezzanine
	Shares	Amount		Stock		Paid-in Capital		Income (Loss)		Earnings		interest		Total Equity		Equity
Balance as of March 31, 2024	47,447	$	474	$	(589,475)	$	412,768	$	(93,733)	$	865,277	$	17,098	$	612,409	$	—
Net (loss) income	—		—		—		—		—		(299,539)		2,771		(296,768)		—
Dividends to shareholders ($0.00 per common share)	—		—		—		—		—		—		—		—		—
Dividends distributed to noncontrolling interest	—		—		—		—		—		—		(2,250)		(2,250)		—
Foreign currency translation adjustments	—		—		—		—		(7,389)		—		8		(7,381)		—
Derivatives valuation, net of tax	—		—		—		—		(6,550)		—		—		(6,550)		—
Vesting of restricted stock units	161		2		2,663		(3,144)		—		—		—		(479)		—
Equity-based compensation expense	—		—		—		5,104		—		—		—		5,104		—
Other, net of tax	—		—		—		—		91		—		—		91		—
Balance as of June 30, 2024	47,608	$	476	$	(586,812)	$	414,728	$	(107,581)	$	565,738	$	17,627	$	304,176	$	—

Six months ended June 30, 2023 and 2024


	Stockholders’ Equity of the Company
								Accumulated
								Other
	Common Stock			Treasury		Additional		Comprehensive		Retained		Noncontrolling				Mezzanine
	Shares	Amount		Stock		Paid-in Capital		Income (Loss)		Earnings		interest		Total Equity		Equity
Balance as of December 31, 2022	47,224	$	472	$	(593,164)	$	367,673	$	(126,301)	$	911,233	$	18,192	$	578,105	$	55,645
Noncontrolling interest adjustment due to buyout	—		—		—		20,457		—		—		—		20,457		(20,457)
Net income	—		—		—		—		—		19,857		4,202		24,059		614
Dividends to shareholders ($0.52 per common share)	—		—		—		—		—		(24,572)		—		(24,572)		—
Buyout of noncontrolling interest	—		—		—		—		—		—		—		—		(31,619)
Dividends distributed to noncontrolling interest	—		—		—		—		—		—		(5,701)		(5,701)		(186)
Foreign currency translation adjustments	—		—		—		—		28,582		—		183		28,765		—
Derivatives valuation, net of tax	—		—		—

TTEC Holdings, Inc. [TTEC] Filings
10-Q	[2024-08-08]
10-Q	[2024-05-08]
10-K	[2024-02-29]
10-Q	[2023-11-08]
10-Q	[2023-08-04]
10-Q	[2023-05-05]
10-K	[2023-02-28]
10-Q	[2022-11-09]
10-Q	[2022-08-09]
10-Q	[2022-05-05]
10-K	[2022-03-03]
10-Q	[2021-11-09]
10-Q	[2021-08-03]
10-Q	[2021-05-04]
10-K	[2021-03-01]
10-Q	[2020-11-04]
10-Q	[2020-08-05]
10-Q	[2020-05-04]
10-K	[2020-03-04]
10-Q	[2019-11-05]
10-Q	[2019-08-07]
10-Q	[2019-05-07]
10-K	[2019-03-06]
10-Q	[2018-11-07]
10-Q	[2018-08-07]
10-Q	[2018-05-10]
10-K	[2018-03-13]
10-Q	[2017-11-08]
10-Q	[2017-08-07]
10-Q	[2017-05-09]
10-K	[2017-03-16]
10-Q	[2016-11-14]
10-Q	[2016-08-03]
10-Q	[2016-05-09]
10-K	[2016-03-14]
10-Q	[2015-11-09]
10-Q	[2015-08-05]
10-Q	[2015-05-11]
10-K	[2015-03-09]
10-Q	[2014-11-05]
10-Q	[2014-08-11]
10-Q	[2014-05-05]
10-K	[2014-02-28]
10-Q	[2013-10-30]
10-Q	[2013-07-30]
10-Q	[2013-05-01]
10-K	[2013-02-26]
10-Q	[2012-11-07]
10-Q	[2012-08-01]
10-Q	[2012-05-01]
10-K	[2012-02-28]