CSG Systems International Reports Third Quarter 2024 Results
CSG Systems International reported Q3 2024 results with total revenue of $295.1 million, up 2.9% year-over-year. GAAP operating income was $31.8 million with a 10.8% margin, while non-GAAP operating income reached $50.1 million with an 18.4% margin. The company announced a contract renewal with Comcast through 2030 and raised its 2024 profitability and non-GAAP EPS guidance. CSG declared a quarterly dividend of $0.30 per share and repurchased approximately 313,000 shares for $15 million. The company committed to returning over $100 million to shareholders via dividends and buybacks in both 2024 and 2025.
CSG Systems International ha riportato i risultati del terzo trimestre 2024 con un fatturato totale di 295,1 milioni di dollari, in aumento del 2,9% rispetto all'anno precedente. L'utile operativo secondo i principi GAAP è stato di 31,8 milioni di dollari, con un margine del 10,8%, mentre l'utile operativo non-GAAP ha raggiunto i 50,1 milioni di dollari con un margine del 18,4%. L'azienda ha annunciato il rinnovo del contratto con Comcast fino al 2030 e ha rivisto al rialzo le previsioni di redditività e dell'utile per azione non-GAAP per il 2024. CSG ha dichiarato un dividendo trimestrale di 0,30 dollari per azione e ha riacquistato circa 313.000 azioni per 15 milioni di dollari. L'azienda si è impegnata a restituire oltre 100 milioni di dollari agli azionisti tramite dividendi e riacquisti sia nel 2024 che nel 2025.
CSG Systems International reportó los resultados del tercer trimestre de 2024 con ingresos totales de 295,1 millones de dólares, un aumento del 2,9% en comparación con el año anterior. El ingreso operativo GAAP fue de 31,8 millones de dólares, con un margen del 10,8%, mientras que el ingreso operativo no-GAAP alcanzó los 50,1 millones de dólares con un margen del 18,4%. La compañía anunció la renovación de su contrato con Comcast hasta 2030 y elevó sus proyecciones de rentabilidad y las ganancias por acción no-GAAP para 2024. CSG declaró un dividendo trimestral de 0,30 dólares por acción y recompra aproximadamente 313,000 acciones por 15 millones de dólares. La empresa se comprometió a devolver más de 100 millones de dólares a los accionistas a través de dividendos y recompensas tanto en 2024 como en 2025.
CSG Systems International는 2024년 3분기 실적을 보고하며 총 매출이 2억 9,510만 달러로 전년 대비 2.9% 증가했다고 발표했습니다. GAAP 기준 운영 소득은 3,180만 달러로 10.8%의 마진을 기록했으며, 비-GAAP 기준 운영 소득은 5,010만 달러로 18.4%의 마진에 도달했습니다. 회사는 Comcast와의 계약 갱신을 2030년까지 발표했으며, 2024년 수익성과 비-GAAP EPS 지침을 상향 조정했습니다. CSG는 분기당 주당 0.30달러의 배당금을 선언하고 약 313,000주를 1,500만 달러에 재매입했습니다. 회사는 2024년과 2025년 모두 배당금과 자사주 매입을 통해 주주에게 1억 달러 이상을 환원할 계획입니다.
CSG Systems International a rapporté ses résultats du troisième trimestre 2024 avec un chiffre d'affaires total de 295,1 millions de dollars, en hausse de 2,9 % par rapport à l'année précédente. Le bénéfice opérationnel selon les normes GAAP était de 31,8 millions de dollars avec une marge de 10,8 %, tandis que le bénéfice opérationnel non-GAAP a atteint 50,1 millions de dollars avec une marge de 18,4 %. L'entreprise a annoncé un renouvellement de contrat avec Comcast jusqu'en 2030 et a relevé ses prévisions de rentabilité et de bénéfice par action non-GAAP pour 2024. CSG a déclaré un dividende trimestriel de 0,30 dollar par action et a racheté environ 313 000 actions pour 15 millions de dollars. L'entreprise s'est engagée à retourner plus de 100 millions de dollars aux actionnaires par le biais de dividendes et de rachats, tant en 2024 qu'en 2025.
CSG Systems International hat die Ergebnisse für das dritte Quartal 2024 veröffentlicht, mit einem Gesamtumsatz von 295,1 Millionen Dollar, was einem Anstieg von 2,9% im Jahresvergleich entspricht. Der GAAP-Betriebsgewinn betrug 31,8 Millionen Dollar mit einer Marge von 10,8%, während der nicht-GAAP-Betriebsgewinn 50,1 Millionen Dollar bei einer Marge von 18,4% erreichte. Das Unternehmen gab die Verlängerung des Vertrags mit Comcast bis 2030 bekannt und hob die Gewinnprognosen und die nicht-GAAP EPS-Leitlinien für 2024 an. CSG erklärte eine vierteljährliche Dividende von 0,30 Dollar pro Aktie und kaufte etwa 313.000 Aktien für 15 Millionen Dollar zurück. Das Unternehmen verpflichtete sich, sowohl 2024 als auch 2025 über 100 Millionen Dollar an die Aktionäre in Form von Dividenden und Rückkäufen zurückzugeben.
- Revenue increased 2.9% YoY to $295.1 million
- Non-GAAP operating margin improved to 18.4% from 17.0% YoY
- Non-GAAP EPS grew 15.2% to $1.06
- Contract renewal with Comcast secured through 2030
- Raised 2024 profitability and non-GAAP EPS guidance
- Committed $100+ million in shareholder returns for 2024 and 2025
- GAAP operating income decreased 2.8% YoY to $31.8 million
- GAAP operating margin declined to 10.8% from 11.4% YoY
- Nine-month GAAP operating income down 10.2% YoY
Insights
CSG Systems delivered a solid Q3 with notable highlights including a 2.9% revenue increase to
Key positives include margin expansion with non-GAAP operating margin reaching
The strategic implications of the Comcast contract extension are significant for CSG's market position in the telecommunications sector. This renewal secures a major revenue stream through 2030, providing exceptional visibility for investors. The company's SaaS revenue growth, bolstered by recent acquisitions contributing
The robust shareholder return program, having delivered nearly
Announced Watershed Contract Renewal with Comcast through Year-End 2030
Raising 2024 Profitability and Non-GAAP EPS Guidance Targets for Second Consecutive Quarter
Commitment to Return
Financial Results:
Third quarter 2024 financial results:
-
Total revenue was
.$295.1 million -
GAAP operating income was
million, or an operating margin of 10.8%, and non-GAAP operating income was$31.8 million, or a non-GAAP adjusted operating margin of 18.4%.$50.1 -
GAAP earnings per diluted share (EPS) was
and non-GAAP EPS was$0.67 .$1.06 -
Cash flows from operations were
, with non-GAAP free cash flow of$39.5 million .$32.0 million
Shareholder Returns:
-
CSG declared its quarterly cash dividend of
per share of common stock, or a total of approximately$0.30 , to shareholders.$9 million -
During the third quarter of 2024, CSG repurchased under its stock repurchase program, approximately 313,000 shares of its common stock for approximately
.$15 million
“We were excited to announce earlier this week a fantastic win-win contract expansion with Comcast that will extend our contract term through year-end 2030,” said Brian Shepherd, President and Chief Executive Officer of CSG. “Regarding Q3 earnings, team CSG posted good operating results in the first nine months of 2024 and we are pleased to raise our 2024 profitability and non-GAAP EPS guidance targets for a second consecutive quarter while reiterating all other guidance metrics. From a shareholder return perspective, we plan on returning
Financial Overview (unaudited)
(in thousands, except per share amounts and percentages):
|
|
Quarter Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||||||||||
|
|
2024 |
|
|
2023 |
|
|
Percent Changed |
|
|
2024 |
|
|
2023 |
|
|
Percent Changed |
|
||||||
GAAP Results: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
295,143 |
|
|
$ |
286,868 |
|
|
|
2.9 |
% |
|
$ |
880,596 |
|
|
$ |
871,934 |
|
|
|
1.0 |
% |
Operating Income |
|
|
31,822 |
|
|
|
32,731 |
|
|
|
(2.8 |
%) |
|
|
89,039 |
|
|
|
99,130 |
|
|
|
(10.2 |
%) |
Operating Margin Percentage |
|
|
10.8 |
% |
|
|
11.4 |
% |
|
|
|
|
|
|
10.1 |
% |
|
|
11.4 |
% |
|
|
|
|
EPS |
|
$ |
0.67 |
|
|
$ |
0.62 |
|
|
|
8.1 |
% |
|
$ |
1.83 |
|
|
$ |
1.75 |
|
|
|
4.6 |
% |
Non-GAAP Results: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income |
|
$ |
50,076 |
|
|
$ |
45,203 |
|
|
|
10.8 |
% |
|
$ |
141,085 |
|
|
$ |
141,664 |
|
|
|
(0.4 |
%) |
Adjusted Operating Margin Percentage |
|
|
18.4 |
% |
|
|
17.0 |
% |
|
|
|
|
|
|
17.4 |
% |
|
|
17.5 |
% |
|
|
|
|
EPS |
|
$ |
1.06 |
|
|
$ |
0.92 |
|
|
|
15.2 |
% |
|
$ |
3.08 |
|
|
$ |
2.76 |
|
|
|
11.6 |
% |
For additional information and reconciliations regarding CSG’s use of non-GAAP financial measures, please refer to the attached Exhibit 2 and the Investor Relations section of CSG’s website at csgi.com.
Results of Operations
GAAP Results: Total revenue for the third quarter of 2024 was
GAAP operating income for the third quarter of 2024 was
GAAP EPS for the third quarter of 2024 was
Non-GAAP Results: Non-GAAP operating income for the third quarter of 2024 was
Non-GAAP EPS for the third quarter of 2024 was
Balance Sheet and Cash Flows
Cash and cash equivalents as of September 30, 2024 were
Summary of Financial Guidance
CSG is revising its financial guidance for the full year 2024, as follows:
|
|
As of November 6, 2024 |
|
Previous |
GAAP Measures: |
|
|
|
|
Revenue |
|
No change |
|
|
Non-GAAP Measures: |
|
|
|
|
Adjusted Operating Margin Percentage |
|
|
|
|
EPS |
|
|
|
|
Adjusted EBITDA |
|
|
|
|
Free Cash Flow |
|
No change |
|
|
For additional information and reconciliations regarding CSG’s use of non-GAAP financial measures, please refer to the attached Exhibit 2 and the Investor Relations section of CSG’s website at csgi.com.
Conference Call
CSG will host a conference call on Wednesday, November 6, 2024 at 5:00 p.m. ET, to discuss CSG’s third quarter of 2024 earnings results. The call will be carried live and archived on the Internet. A link to the conference call is available at http://ir.csgi.com. In addition, to reach the conference by phone, call 1-888-412-4131 and use the passcode 2327393.
Additional Information
For information about CSG, please visit CSG’s web site at csgi.com. Additional information can be found in the Investor Relations section of the website.
About CSG
CSG empowers companies to build unforgettable experiences, making it easier for people and businesses to connect with, use and pay for the services they value most. Our customer experience, billing and payments solutions help companies of any size make money and make a difference. With our SaaS solutions, company leaders can take control of their future and tap into guidance along the way from our fiercely committed and forward-thinking CSGers around the world.
Want to be future-ready and a change-maker like the global brands that trust CSG? Visit csgi.com to learn more.
Forward-Looking Statements
This news release contains forward-looking statements as defined under the Securities Act of 1933, as amended, that are based on assumptions about a number of important factors and involve risks and uncertainties that could cause actual results to differ materially from what appears in this news release. Some of these key factors include, but are not limited to the following items:
- CSG derives a significant portion of its revenue from a limited number of customers, with approximately forty percent of its revenue from its two largest customers;
- Fluctuations in credit market conditions, general global economic and political conditions, and foreign currency exchange rates;
- CSG’s ability to maintain a reliable, secure computing environment;
- Continued market acceptance of CSG’s products and services;
- CSG’s ability to continuously develop and enhance products in a timely, cost-effective, technically advanced and competitive manner;
- CSG’s ability to deliver its solutions in a timely fashion within budget, particularly large and complex software implementations;
- CSG’s dependency on the global telecommunications industry, and in particular, the North American telecommunications industry;
- CSG’s ability to meet its financial expectations;
- Increasing competition in CSG’s market from companies of greater size and with broader presence;
- CSG’s ability to successfully integrate and manage acquired businesses or assets to achieve expected strategic, operating and financial goals;
- CSG’s ability to protect its intellectual property rights;
- CSG’s ability to conduct business in the international marketplace;
-
CSG’s ability to comply with applicable
U.S. and International laws and regulations; and - CSG’s business may be disrupted, and its results of operations and cash flows adversely affected by a global pandemic.
This list is not exhaustive, and readers are encouraged to review the additional risks and important factors described in CSG’s reports on Forms 10-K and 10-Q and other filings made with the SEC.
CSG SYSTEMS INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS-UNAUDITED (in thousands) |
||||||||
|
|
September 30, 2024 |
|
|
December 31, 2023 |
|
||
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
118,444 |
|
|
$ |
186,264 |
|
Settlement and merchant reserve assets |
|
|
240,755 |
|
|
|
274,699 |
|
Trade accounts receivable: |
|
|
|
|
|
|
|
|
Billed, net of allowance of |
|
|
279,930 |
|
|
|
267,680 |
|
Unbilled |
|
|
82,585 |
|
|
|
82,163 |
|
Income taxes receivable |
|
|
13,992 |
|
|
|
1,345 |
|
Other current assets |
|
|
51,534 |
|
|
|
50,075 |
|
Total current assets |
|
|
787,240 |
|
|
|
862,226 |
|
Non-current assets: |
|
|
|
|
|
|
|
|
Property and equipment, net of depreciation of |
|
|
58,353 |
|
|
|
65,545 |
|
Operating lease right-of-use assets |
|
|
25,842 |
|
|
|
34,283 |
|
Software, net of amortization of |
|
|
22,953 |
|
|
|
14,224 |
|
Goodwill |
|
|
323,449 |
|
|
|
308,596 |
|
Acquired customer contracts, net of amortization of |
|
|
42,786 |
|
|
|
35,879 |
|
Customer contract costs, net of amortization of |
|
|
60,490 |
|
|
|
54,421 |
|
Deferred income taxes |
|
|
57,831 |
|
|
|
57,855 |
|
Other assets |
|
|
8,502 |
|
|
|
10,017 |
|
Total non-current assets |
|
|
600,206 |
|
|
|
580,820 |
|
Total assets |
|
$ |
1,387,446 |
|
|
$ |
1,443,046 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Current portion of long-term debt |
|
$ |
7,500 |
|
|
$ |
7,500 |
|
Operating lease liabilities |
|
|
14,002 |
|
|
|
15,946 |
|
Customer deposits |
|
|
37,716 |
|
|
|
41,035 |
|
Trade accounts payable |
|
|
51,907 |
|
|
|
46,406 |
|
Accrued employee compensation |
|
|
57,704 |
|
|
|
84,380 |
|
Settlement and merchant reserve liabilities |
|
|
238,783 |
|
|
|
273,817 |
|
Deferred revenue |
|
|
62,797 |
|
|
|
54,199 |
|
Income taxes payable |
|
|
937 |
|
|
|
4,104 |
|
Other current liabilities |
|
|
28,163 |
|
|
|
33,449 |
|
Total current liabilities |
|
|
499,509 |
|
|
|
560,836 |
|
Non-current liabilities: |
|
|
|
|
|
|
|
|
Long-term debt, net of unamortized discounts of |
|
|
531,986 |
|
|
|
534,997 |
|
Operating lease liabilities |
|
|
24,427 |
|
|
|
34,360 |
|
Deferred revenue |
|
|
22,968 |
|
|
|
23,447 |
|
Income taxes payable |
|
|
2,684 |
|
|
|
3,041 |
|
Deferred income taxes |
|
|
120 |
|
|
|
123 |
|
Other non-current liabilities |
|
|
17,341 |
|
|
|
12,916 |
|
Total non-current liabilities |
|
|
599,526 |
|
|
|
608,884 |
|
Total liabilities |
|
|
1,099,035 |
|
|
|
1,169,720 |
|
Stockholders' equity: |
|
|
|
|
|
|
|
|
Preferred stock, par value outstanding |
|
|
- |
|
|
|
- |
|
Common stock, par value outstanding |
|
|
717 |
|
|
|
713 |
|
Additional paid-in capital |
|
|
509,294 |
|
|
|
490,947 |
|
Treasury stock, at cost; 41,115 and 40,398 shares |
|
|
(1,170,118 |
) |
|
|
(1,136,055 |
) |
Accumulated other comprehensive income (loss): |
|
|
|
|
|
|
|
|
Unrealized gain on short-term investments, net of tax |
|
|
- |
|
|
|
1 |
|
Cumulative foreign currency translation adjustments |
|
|
(45,562 |
) |
|
|
(50,414 |
) |
Accumulated earnings |
|
|
994,080 |
|
|
|
968,134 |
|
Total stockholders' equity |
|
|
288,411 |
|
|
|
273,326 |
|
Total liabilities and stockholders' equity |
|
$ |
1,387,446 |
|
|
$ |
1,443,046 |
|
|
CSG SYSTEMS INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME-UNAUDITED (in thousands, except per share amounts) |
|||||||||||||||
|
Quarter Ended |
|
|
Nine Months Ended |
|
||||||||||
|
September 30, 2024 |
|
|
September 30, 2023 |
|
|
September 30, 2024 |
|
|
September 30, 2023 |
|
||||
Revenue |
$ |
295,143 |
|
|
$ |
286,868 |
|
|
$ |
880,596 |
|
|
$ |
871,934 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue (exclusive of depreciation, shown separately below) |
|
149,487 |
|
|
|
152,734 |
|
|
|
460,266 |
|
|
|
458,897 |
|
Other operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
41,665 |
|
|
|
35,292 |
|
|
|
116,171 |
|
|
|
107,401 |
|
Selling, general and administrative |
|
63,913 |
|
|
|
59,097 |
|
|
|
186,794 |
|
|
|
180,930 |
|
Depreciation |
|
5,313 |
|
|
|
5,862 |
|
|
|
16,286 |
|
|
|
17,155 |
|
Restructuring and reorganization charges |
|
2,943 |
|
|
|
1,152 |
|
|
|
12,040 |
|
|
|
8,421 |
|
Total operating expenses |
|
263,321 |
|
|
|
254,137 |
|
|
|
791,557 |
|
|
|
772,804 |
|
Operating income |
|
31,822 |
|
|
|
32,731 |
|
|
|
89,039 |
|
|
|
99,130 |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
(7,778 |
) |
|
|
(8,036 |
) |
|
|
(22,982 |
) |
|
|
(23,092 |
) |
Interest income |
|
1,922 |
|
|
|
1,175 |
|
|
|
6,641 |
|
|
|
2,516 |
|
Other, net |
|
(2,187 |
) |
|
|
813 |
|
|
|
(1,455 |
) |
|
|
(3,047 |
) |
Total other |
|
(8,043 |
) |
|
|
(6,048 |
) |
|
|
(17,796 |
) |
|
|
(23,623 |
) |
Income before income taxes |
|
23,779 |
|
|
|
26,683 |
|
|
|
71,243 |
|
|
|
75,507 |
|
Income tax provision |
|
(4,691 |
) |
|
|
(7,989 |
) |
|
|
(18,859 |
) |
|
|
(21,931 |
) |
Net income |
$ |
19,088 |
|
|
$ |
18,694 |
|
|
$ |
52,384 |
|
|
$ |
53,576 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
28,362 |
|
|
|
30,097 |
|
|
|
28,475 |
|
|
|
30,381 |
|
Diluted |
|
28,468 |
|
|
|
30,284 |
|
|
|
28,621 |
|
|
|
30,540 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.67 |
|
|
$ |
0.62 |
|
|
$ |
1.84 |
|
|
$ |
1.76 |
|
Diluted |
|
0.67 |
|
|
|
0.62 |
|
|
|
1.83 |
|
|
|
1.75 |
|
CSG SYSTEMS INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS-UNAUDITED (in thousands) |
|||||||
|
|
|
|||||
|
Nine Months Ended |
|
|||||
|
September 30, 2024 |
|
|
September 30, 2023 |
|
||
Cash flows from operating activities: |
|
|
|
|
|
|
|
Net income |
$ |
52,384 |
|
|
$ |
53,576 |
|
Adjustments to reconcile net income to net cash provided by operating activities- |
|
|
|
|
|
|
|
Depreciation |
|
16,724 |
|
|
|
17,549 |
|
Amortization |
|
37,467 |
|
|
|
34,543 |
|
Asset impairment |
|
- |
|
|
|
1,689 |
|
Gain on lease modifications |
|
- |
|
|
|
(4,349 |
) |
Unrealized foreign currency transaction (gain) loss, net |
|
225 |
|
|
|
(442 |
) |
Deferred income taxes |
|
(189 |
) |
|
|
(12,504 |
) |
Stock-based compensation |
|
25,023 |
|
|
|
21,253 |
|
Subtotal |
|
131,634 |
|
|
|
111,315 |
|
Changes in operating assets and liabilities, net of acquired amounts: |
|
|
|
|
|
|
|
Trade accounts receivable, net |
|
(7,873 |
) |
|
|
(33,351 |
) |
Other current and non-current assets and liabilities |
|
(12,771 |
) |
|
|
(11,449 |
) |
Income taxes payable/receivable |
|
(16,194 |
) |
|
|
(4,650 |
) |
Trade accounts payable and accrued liabilities |
|
(48,658 |
) |
|
|
(24,158 |
) |
Deferred revenue |
|
7,075 |
|
|
|
14,658 |
|
Net cash provided by operating activities |
|
53,213 |
|
|
|
52,365 |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
Purchases of software, property, and equipment |
|
(16,528 |
) |
|
|
(22,940 |
) |
Proceeds from sale/maturity of short-term investments |
|
- |
|
|
|
71 |
|
Business combinations, net of cash and settlement assets acquired of |
|
17,293 |
|
|
|
- |
|
Net cash provided by (used in) investing activities |
|
765 |
|
|
|
(22,869 |
) |
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
Proceeds from issuance of common stock |
|
2,416 |
|
|
|
2,541 |
|
Payment of cash dividends |
|
(26,598 |
) |
|
|
(26,231 |
) |
Repurchase of common stock |
|
(42,439 |
) |
|
|
(116,418 |
) |
Deferred acquisition payments |
|
(2,488 |
) |
|
|
(3,220 |
) |
Proceeds from long-term debt |
|
15,000 |
|
|
|
470,000 |
|
Payments on long-term debt |
|
(20,625 |
) |
|
|
(310,625 |
) |
Purchase of capped call transactions related to convertible notes |
|
- |
|
|
|
(34,298 |
) |
Payments of deferred financing costs |
|
- |
|
|
|
(13,518 |
) |
Payments on financing obligations |
|
(2,191 |
) |
|
|
- |
|
Settlement and merchant reserve activity |
|
(79,606 |
) |
|
|
(46,196 |
) |
Net cash used in financing activities |
|
(156,531 |
) |
|
|
(77,965 |
) |
Effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash |
|
(337 |
) |
|
|
(448 |
) |
|
|
|
|
|
|
|
|
Net decrease in cash, cash equivalents, and restricted cash |
|
(102,890 |
) |
|
|
(48,917 |
) |
|
|
|
|
|
|
|
|
Cash, cash equivalents, and restricted cash, beginning of period |
|
463,876 |
|
|
|
389,018 |
|
Cash, cash equivalents, and restricted cash, end of period |
$ |
360,986 |
|
|
$ |
340,101 |
|
|
|
|
|
|
|
|
|
Supplemental disclosures of cash flow information: |
|
|
|
|
|
|
|
Cash paid during the period for- |
|
|
|
|
|
|
|
Interest |
$ |
24,592 |
|
|
$ |
21,772 |
|
Income taxes |
|
35,292 |
|
|
|
39,136 |
|
|
|
|
|
|
|
|
|
Non-cash investing and financing activities- |
|
|
|
|
|
|
|
Software, property, and equipment included in current and noncurrent liabilities |
|
9,830 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
Reconciliation of cash, cash equivalents, and restricted cash: |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
118,444 |
|
|
$ |
146,730 |
|
Settlement and merchant reserve assets |
|
240,755 |
|
|
|
193,371 |
|
Restricted cash included in current and non-current assets |
|
1,787 |
|
|
|
- |
|
Total cash, cash equivalents, and restricted cash |
$ |
360,986 |
|
|
$ |
340,101 |
|
EXHIBIT 1
CSG SYSTEMS INTERNATIONAL, INC.
SUPPLEMENTAL REVENUE ANALYSIS
Revenue by Significant Customers:
|
|
Quarter Ended |
|
|
Quarter Ended |
|
|
Quarter Ended |
|
|||||||||||||||
|
|
September 30, 2024 |
|
|
June 30, 2024 |
|
|
September 30, 2023 |
|
|||||||||||||||
|
|
Amount |
|
|
% of Revenue |
|
|
Amount |
|
|
% of Revenue |
|
|
Amount |
|
|
% of Revenue |
|
||||||
Charter |
|
$ |
59,070 |
|
|
|
20 |
% |
|
$ |
60,629 |
|
|
|
21 |
% |
|
$ |
59,432 |
|
|
|
21 |
% |
Comcast |
|
|
58,688 |
|
|
|
20 |
% |
|
|
54,576 |
|
|
|
19 |
% |
|
|
53,653 |
|
|
|
19 |
% |
Revenue by Vertical |
||||||||||||
|
|
Quarter Ended |
|
|
Quarter Ended |
|
|
Quarter Ended |
|
|||
|
|
September 30, 2024 |
|
|
June 30, 2024 |
|
|
September 30, 2023 |
|
|||
Broadband/Cable/Satellite |
|
|
53 |
% |
|
|
53 |
% |
|
|
53 |
% |
Telecommunications |
|
|
18 |
% |
|
|
16 |
% |
|
|
20 |
% |
All other |
|
|
29 |
% |
|
|
31 |
% |
|
|
27 |
% |
Total revenue |
|
|
100 |
% |
|
|
100 |
% |
|
|
100 |
% |
Revenue by Geography |
||||||||||||
|
|
Quarter Ended |
|
|
Quarter Ended |
|
|
Quarter Ended |
|
|||
|
|
September 30, 2024 |
|
|
June 30, 2024 |
|
|
September 30, 2023 |
|
|||
|
|
|
88 |
% |
|
|
89 |
% |
|
|
86 |
% |
|
|
|
9 |
% |
|
|
6 |
% |
|
|
9 |
% |
|
|
|
3 |
% |
|
|
5 |
% |
|
|
5 |
% |
Total revenue |
|
|
100 |
% |
|
|
100 |
% |
|
|
100 |
% |
EXHIBIT 2
CSG SYSTEMS INTERNATIONAL, INC.
DISCLOSURES FOR NON-GAAP FINANCIAL MEASURES
Use of Non-GAAP Financial Measures and Limitations
To supplement its condensed consolidated financial statements presented in accordance with generally accepted accounting principles (GAAP), CSG uses non-GAAP operating income, non-GAAP adjusted operating margin percentage, non-GAAP EPS, non-GAAP adjusted EBITDA, and non-GAAP free cash flow. CSG believes that these non-GAAP financial measures, when reviewed in conjunction with its GAAP financial measures, provide investors with greater transparency to the information used by CSG’s management in its financial and operational decision making. CSG uses these non-GAAP financial measures for the following purposes:
- Certain internal financial planning, reporting, and analysis;
- Forecasting and budgeting;
- Certain management compensation incentives; and
- Communications with CSG’s Board of Directors, stockholders, financial analysts, and investors.
These non-GAAP financial measures are provided with the intent of providing investors with the following information:
- A more complete understanding of CSG’s underlying operational results, trends, and cash generating capabilities;
- Consistency and comparability with CSG’s historical financial results; and
- Comparability to similar companies, many of which present similar non-GAAP financial measures to investors.
Non-GAAP financial measures are not measures of performance under GAAP, and therefore should not be considered in isolation or as a substitute for GAAP financial information. Limitations with the use of non-GAAP financial measures include the following items:
- Non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles;
- The way in which CSG calculates non-GAAP financial measures may differ from the way in which other companies calculate similar non-GAAP financial measures;
- Non-GAAP financial measures do not include all items of income and expense that affect CSG’s operations and that are required by GAAP to be included in financial statements;
- Certain adjustments to CSG’s non-GAAP financial measures result in the exclusion of items that are recurring and will be reflected in CSG’s financial statements in future periods; and
- Certain charges excluded from CSG’s non-GAAP financial measures are cash expenses, and therefore do impact CSG’s cash position.
CSG compensates for these limitations by relying primarily on its GAAP results and using non-GAAP financial measures as a supplement only. Additionally, CSG provides specific information regarding the treatment of GAAP amounts considered in preparing the non-GAAP financial measures and reconciles each non-GAAP financial measure to the most directly comparable GAAP measure.
Non-GAAP Financial Measures: Basis of Presentation
The table below outlines the exclusions from CSG’s non-GAAP financial measures:
Non-GAAP Exclusions |
|
Operating Income |
|
Adjusted Operating Margin Percentage |
|
EPS |
Transaction fees |
|
— |
|
X |
|
— |
Restructuring and reorganization charges |
|
X |
|
X |
|
X |
Executive transition costs |
|
X |
|
X |
|
X |
Acquisition-related expenses: |
|
|
|
|
|
|
Amortization of acquired intangible assets |
|
X |
|
X |
|
X |
Earn-out compensation |
|
X |
|
X |
|
X |
Transaction-related costs |
|
X |
|
X |
|
X |
Stock-based compensation |
|
X |
|
X |
|
X |
Gain (loss) on debt extinguishment/conversion |
|
— |
|
— |
|
X |
Gain (loss) on acquisitions or dispositions |
|
— |
|
— |
|
X |
Unusual income tax matters |
|
— |
|
— |
|
X |
CSG believes that excluding certain items in calculating its non-GAAP financial measures provides meaningful supplemental information regarding CSG’s performance and these items are excluded for the following reasons:
- Transaction fees are primarily comprised of fees paid to third-party payment processors and financial institutions and interchange fees under CSG’s payment services contracts. Transaction fees are included in revenue in CSG’s Income Statement (and not netted against revenue) because CSG maintains control and acts as principal over the integrated service provided under its payment services customer contracts. However, CSG excludes expense associated with transaction fees from the numerator and denominator in calculating its non-GAAP adjusted operating margin percentage in order to provide comparability with historical and future periods and with its peer group and competitors.
- Restructuring and reorganization charges are expenses that result from cost reduction initiatives and/or significant changes to CSG’s business, to include such things as involuntary employee terminations, changes in management structure, divestitures of businesses, facility consolidations and abandonments, and fundamental reorganizations impacting operational focus and direction. These charges are not considered reflective of CSG’s recurring business operating results. The exclusion of these items in calculating CSG’s non-GAAP financial measures allows management and investors an additional means to compare CSG’s current financial results with historical and future periods.
- Executive transition costs include expenses incurred related to a departure of a CSG executive officer under the terms of the related separation agreement. These types of costs are not considered reflective of CSG’s recurring business operating results. The exclusion of these costs in calculating CSG’s non-GAAP financial measures allows management and investors an additional means to compare CSG’s current financial results with historical and future periods.
- Acquisition-related expenses include amortization of acquired intangible assets, earn-out compensation, and transaction-related costs. Transaction-related costs, which typically include expenses related to legal, accounting, and other professional services, are direct and incremental expenses related to business acquisitions, and thus, are not considered reflective of CSG’s recurring business operating results. The total amount of acquisition-related expenses can vary significantly between periods based on the number and size of acquisition activities, previously acquired intangible assets becoming fully amortized, and ultimate realization of earn-out compensation. In addition, the timing of these expenses may not directly correlate with underlying performance of the CSG’s operations. Therefore, the exclusion of acquisition-related expenses in calculating CSG’s non-GAAP financial measures allows management and investors an additional means to compare CSG’s current financial results with historical and future periods.
- Stock-based compensation results from CSG’s issuance of equity awards to its employees under incentive compensation programs. The amount of this incentive compensation in any period is not generally linked to the level of performance by employees or CSG. The exclusion of these expenses in calculating CSG’s non-GAAP financial measures allows management and investors an additional means to evaluate the non-cash expense related to compensation included in CSG’s results of operations, and therefore, the exclusion of this item allows investors to further evaluate the cash generating capabilities of CSG’s business.
- Gains and losses related to the extinguishment/conversion of debt can be as a result of the refinancing of CSG’s credit agreement and/or repurchase, conversion, or settlement of CSG’s convertible notes. These activities, to include any derivative activity related to debt conversions, are not considered reflective of CSG’s recurring business operating results. Any resulting gain or loss is generally non-cash income or expense, and therefore, the exclusion of these items allows investors to further evaluate the cash impact of these activities for cash flow and liquidity purposes. In addition, the exclusion of these gains and losses in calculating CSG’s non-GAAP EPS allows management and investors an additional means to compare CSG’s current operating results with historical and future periods.
- Gains or losses related to the acquisition or disposition of certain of CSG’s business activities are not considered reflective of CSG’s recurring business operating results. Any resulting gain or loss is generally non-cash income or expense, and therefore, the exclusion of these items allows investors to further evaluate the cash impact of these activities for cash flow and liquidity purposes. In addition, the exclusion of these gains and losses in calculating CSG’s non-GAAP EPS allows management and investors an additional means to compare CSG’s current operating results with historical and future periods.
- Unusual items within CSG’s quarterly and/or annual income tax expense can occur from such things as income tax accounting timing matters, income taxes related to unusual events, or as a result of different treatment of certain items for book accounting and income tax purposes. Consideration of such items in calculating CSG’s non-GAAP financial measures allows management and investors an additional means to compare CSG’s current financial results with historical and future periods
CSG also reports non-GAAP adjusted EBITDA and non-GAAP free cash flow. Management believes non-GAAP adjusted EBITDA is a useful measure to investors in evaluating CSG’s operating performance, debt servicing capabilities, and enterprise valuation. CSG defines non-GAAP adjusted EBITDA as income before interest, income taxes, depreciation, amortization, stock-based compensation, foreign currency transaction adjustments, acquisition-related expenses, and unusual items, such as restructuring and reorganization charges, executive transition costs, gains and losses related to the extinguishment of debt, and gains and losses on acquisitions or dispositions, as discussed above. Additionally, management uses non-GAAP free cash flow, among other measures, to assess its financial performance and cash generating capabilities, and believes that it is useful to investors because it shows CSG’s cash available to service debt, make strategic acquisitions and investments, repurchase its common stock, pay cash dividends, and fund ongoing operations. CSG defines non-GAAP free cash flow as net cash flows from operating activities less the purchases of software, property and equipment.
Non-GAAP Financial Measures
Non-GAAP Operating Income and Non-GAAP Adjusted Operating Margin Percentage:
The reconciliation of GAAP operating income to non-GAAP operating income, and calculation of CSG’s non-GAAP adjusted operating margin percentage, for the indicated periods are as follows (in thousands, except percentages):
|
|
Quarter Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Non-GAAP Operating Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income |
|
$ |
31,822 |
|
|
$ |
32,731 |
|
|
$ |
89,039 |
|
|
$ |
99,130 |
|
Restructuring and reorganization charges (1) |
|
|
2,943 |
|
|
|
1,152 |
|
|
|
12,040 |
|
|
|
8,421 |
|
Executive transition costs |
|
|
- |
|
|
|
1,148 |
|
|
|
352 |
|
|
|
1,148 |
|
Acquisition-related expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets |
|
|
3,929 |
|
|
|
2,996 |
|
|
|
10,174 |
|
|
|
9,203 |
|
Earn-out compensation |
|
|
2,591 |
|
|
|
- |
|
|
|
3,416 |
|
|
|
(14 |
) |
Transaction-related costs |
|
|
32 |
|
|
|
(40 |
) |
|
|
243 |
|
|
|
2,136 |
|
Stock-based compensation (1) |
|
|
8,759 |
|
|
|
7,216 |
|
|
|
25,821 |
|
|
|
21,640 |
|
Non-GAAP operating income |
|
$ |
50,076 |
|
|
$ |
45,203 |
|
|
$ |
141,085 |
|
|
$ |
141,664 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Adjusted Operating Margin Percentage |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
295,143 |
|
|
$ |
286,868 |
|
|
$ |
880,596 |
|
|
$ |
871,934 |
|
Less: Transaction fees (2) |
|
|
(22,524 |
) |
|
|
(20,314 |
) |
|
|
(71,793 |
) |
|
|
(63,463 |
) |
Revenue less transaction fees |
|
$ |
272,619 |
|
|
$ |
266,554 |
|
|
$ |
808,803 |
|
|
$ |
808,471 |
|
Non-GAAP adjusted operating margin percentage |
|
|
18.4 |
% |
|
|
17.0 |
% |
|
|
17.4 |
% |
|
|
17.5 |
% |
(1) |
Restructuring and reorganization charges include stock-based compensation, which is not included in the stock-based compensation line in the tables above and following, and depreciation, which has not been recorded to the depreciation line item on CSG’s Income Statement. |
(2) |
Transaction fees are primarily comprised of fees paid to third-party payment processors and financial institutions and interchange fees under CSG’s payment services contracts. Transaction fees are included in revenue in CSG's Income Statement (and not netted against revenue) because CSG maintains control and acts as principal over the integrated service provided under its payment services customer contracts. However, CSG excludes expense associated with transaction fees from the numerator and denominator in calculating its non-GAAP adjusted operating margin percentage in order to provide comparability with historical and future periods and with its peer group and competitors. |
Non-GAAP EPS:
The reconciliations of GAAP EPS to non-GAAP EPS for the indicated periods are as follows (in thousands, except per share amounts):
|
|
Quarter Ended |
|
|
Quarter Ended |
|
||||||||||
|
|
September 30, 2024 |
|
|
September 30, 2023 |
|
||||||||||
|
|
Amounts |
|
|
EPS (4) |
|
|
Amounts |
|
|
EPS (4) |
|
||||
GAAP net income |
|
$ |
19,088 |
|
|
$ |
0.67 |
|
|
$ |
18,694 |
|
|
$ |
0.62 |
|
GAAP income tax provision (3) |
|
|
4,691 |
|
|
|
|
|
|
|
7,989 |
|
|
|
|
|
GAAP income before income taxes |
|
|
23,779 |
|
|
|
|
|
|
|
26,683 |
|
|
|
|
|
Restructuring and reorganization charges (1) |
|
|
2,943 |
|
|
|
|
|
|
|
1,152 |
|
|
|
|
|
Executive transition costs |
|
|
- |
|
|
|
|
|
|
|
1,148 |
|
|
|
|
|
Acquisition-related costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets |
|
|
3,929 |
|
|
|
|
|
|
|
2,996 |
|
|
|
|
|
Earn-out compensation |
|
|
2,591 |
|
|
|
|
|
|
|
- |
|
|
|
|
|
Transaction-related costs |
|
|
32 |
|
|
|
|
|
|
|
(40 |
) |
|
|
|
|
Stock-based compensation (1) |
|
|
8,759 |
|
|
|
|
|
|
|
7,216 |
|
|
|
|
|
Non-GAAP income before income taxes |
|
|
42,033 |
|
|
|
|
|
|
|
39,155 |
|
|
|
|
|
Non-GAAP income tax provision (3) |
|
|
(11,979 |
) |
|
|
|
|
|
|
(11,159 |
) |
|
|
|
|
Non-GAAP net income |
|
$ |
30,054 |
|
|
$ |
1.06 |
|
|
$ |
27,996 |
|
|
$ |
0.92 |
|
|
|
Nine Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, 2024 |
|
|
September 30, 2023 |
|
||||||||||
|
|
Amounts |
|
|
EPS (4) |
|
|
Amounts |
|
|
EPS (4) |
|
||||
GAAP net income |
|
$ |
52,384 |
|
|
$ |
1.83 |
|
|
$ |
53,576 |
|
|
$ |
1.75 |
|
GAAP income tax provision (3) |
|
|
18,859 |
|
|
|
|
|
|
|
21,931 |
|
|
|
|
|
GAAP income before income taxes |
|
|
71,243 |
|
|
|
|
|
|
|
75,507 |
|
|
|
|
|
Restructuring and reorganization charges (1) |
|
|
12,040 |
|
|
|
|
|
|
|
8,421 |
|
|
|
|
|
Executive transition costs |
|
|
352 |
|
|
|
|
|
|
|
1,148 |
|
|
|
|
|
Acquisition-related expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets |
|
|
10,174 |
|
|
|
|
|
|
|
9,203 |
|
|
|
|
|
Earn-out compensation |
|
|
3,416 |
|
|
|
|
|
|
|
(14 |
) |
|
|
|
|
Transaction-related costs |
|
|
243 |
|
|
|
|
|
|
|
2,136 |
|
|
|
|
|
Stock-based compensation (1) |
|
|
25,821 |
|
|
|
|
|
|
|
21,640 |
|
|
|
|
|
Non-GAAP income before income taxes |
|
|
123,289 |
|
|
|
|
|
|
|
118,041 |
|
|
|
|
|
Non-GAAP income tax provision (3) |
|
|
(35,137 |
) |
|
|
|
|
|
|
(33,642 |
) |
|
|
|
|
Non-GAAP net income |
|
$ |
88,152 |
|
|
$ |
3.08 |
|
|
$ |
84,399 |
|
|
$ |
2.76 |
|
(3) |
The GAAP effective income tax rates for the third quarters of 2024 and 2023 were approximately |
The non-GAAP effective income tax rates for the third quarters of 2024 and 2023 were |
|
(4) |
The outstanding diluted shares for the third quarter and nine months ended September 30, 2024 were 28.5 million and 28.6 million, respectively, and for the third quarter and nine months ended September 30, 2023 were 30.3 and 30.5 million, respectively. |
Non-GAAP Adjusted EBITDA:
CSG’s calculation of non-GAAP adjusted EBITDA and the reconciliation of CSG’s non-GAAP adjusted EBITDA measure to GAAP net income is provided below for the indicated periods (in thousands, except percentages):
|
|
Quarter Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
GAAP net income |
|
$ |
19,088 |
|
|
$ |
18,694 |
|
|
$ |
52,384 |
|
|
$ |
53,576 |
|
GAAP income tax provision |
|
|
4,691 |
|
|
|
7,989 |
|
|
|
18,859 |
|
|
|
21,931 |
|
Interest expense (5) |
|
|
7,778 |
|
|
|
8,036 |
|
|
|
22,982 |
|
|
|
23,092 |
|
Interest and investment income and other, net |
|
|
265 |
|
|
|
(1,988 |
) |
|
|
(5,186 |
) |
|
|
531 |
|
GAAP operating income |
|
|
31,822 |
|
|
|
32,731 |
|
|
|
89,039 |
|
|
|
99,130 |
|
Restructuring and reorganization charges (1) |
|
|
2,943 |
|
|
|
1,152 |
|
|
|
12,040 |
|
|
|
8,421 |
|
Executive transition costs |
|
|
- |
|
|
|
1,148 |
|
|
|
352 |
|
|
|
1,148 |
|
Acquisition-related expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets (6) |
|
|
3,929 |
|
|
|
2,996 |
|
|
|
10,174 |
|
|
|
9,203 |
|
Earn-out compensation |
|
|
2,591 |
|
|
|
- |
|
|
|
3,416 |
|
|
|
(14 |
) |
Transaction-related costs |
|
|
32 |
|
|
|
(40 |
) |
|
|
243 |
|
|
|
2,136 |
|
Stock-based compensation (1) |
|
|
8,759 |
|
|
|
7,216 |
|
|
|
25,821 |
|
|
|
21,640 |
|
Amortization of other intangible assets (6) |
|
|
3,139 |
|
|
|
3,438 |
|
|
|
8,584 |
|
|
|
10,274 |
|
Amortization of customer contract costs (6) |
|
|
5,373 |
|
|
|
4,997 |
|
|
|
16,095 |
|
|
|
14,390 |
|
Depreciation (1) |
|
|
5,313 |
|
|
|
5,862 |
|
|
|
16,286 |
|
|
|
17,155 |
|
Non-GAAP adjusted EBITDA |
|
$ |
63,901 |
|
|
$ |
59,500 |
|
|
$ |
182,050 |
|
|
$ |
183,483 |
|
Non-GAAP adjusted EBITDA as a percentage of revenue less transaction fees (2) |
|
|
23.4 |
% |
|
|
22.3 |
% |
|
|
22.5 |
% |
|
|
22.7 |
% |
(5) | Interest expense includes amortization of deferred financing costs as provided in Note 6 below. |
(6) | Amortization on the statement of cash flows is made up of the following items for the indicated periods (in thousands): |
|
|
Quarter Ended |
|
|
Nine Months Ended |
|
|||||||||||
|
|
September 30, |
|
|
September 30, |
|
|||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|||||
Amortization of acquired intangible assets |
|
$ |
3,929 |
|
|
$ |
2,996 |
|
|
$ |
10,174 |
|
|
$ |
9,203 |
|
|
Amortization of other intangible assets |
|
|
3,139 |
|
|
|
3,438 |
|
|
|
8,584 |
|
|
|
10,274 |
|
|
Amortization of customer contract costs |
|
|
5,373 |
|
|
|
4,997 |
|
|
|
16,095 |
|
|
|
14,390 |
|
|
Amortization of deferred financing costs |
|
|
879 |
|
|
|
304 |
|
|
|
2,614 |
|
|
|
676 |
|
|
Total amortization |
|
$ |
13,320 |
|
|
$ |
11,735 |
|
|
$ |
37,467 |
|
|
$ |
34,543 |
|
Non-GAAP Free Cash Flow:
CSG’s calculation of non-GAAP free cash flow and the reconciliation of CSG’s non-GAAP free cash flow measure to cash flows from operating activities are provided below for the indicated periods (in thousands):
|
|
Quarter Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Cash flows from operating activities |
|
$ |
39,459 |
|
|
$ |
24,582 |
|
|
$ |
53,213 |
|
|
$ |
52,365 |
|
Purchases of software, property and equipment |
|
|
(7,455 |
) |
|
|
(6,512 |
) |
|
|
(16,528 |
) |
|
|
(22,940 |
) |
Non-GAAP free cash flow |
|
$ |
32,004 |
|
|
$ |
18,070 |
|
|
$ |
36,685 |
|
|
$ |
29,425 |
|
Non-GAAP Financial Measures – 2024 Financial Guidance
Non-GAAP Operating Income and Non-GAAP Adjusted Operating Margin Percentage:
The reconciliation of GAAP operating income to non-GAAP operating income, and calculation of non-GAAP adjusted operating margin percentage, as included in CSG’s 2024 full year financial guidance, is as follows (in thousands, except percentages):
|
|
2024 Guidance Range |
|
|||||
|
|
Low Range |
|
|
High Range |
|
||
Non-GAAP Operating Income |
|
|
|
|
|
|
|
|
GAAP operating income |
|
$ |
129,300 |
|
|
$ |
139,300 |
|
Restructuring and reorganization charges |
|
|
12,000 |
|
|
|
12,000 |
|
Executive transition costs |
|
|
400 |
|
|
|
400 |
|
Acquisition-related expenses: |
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets |
|
|
14,000 |
|
|
|
14,000 |
|
Earn-out compensation |
|
|
5,600 |
|
|
|
5,600 |
|
Transaction-related costs |
|
|
400 |
|
|
|
400 |
|
Stock-based compensation |
|
|
33,600 |
|
|
|
33,600 |
|
Non-GAAP operating income |
|
$ |
195,300 |
|
|
$ |
205,300 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Margin Percentage |
|
|
|
|
|
|
|
|
Revenue |
|
$ |
1,200,000 |
|
|
$ |
1,240,000 |
|
Less: Transaction fees |
|
|
(98,000 |
) |
|
|
(103,000 |
) |
Revenue less transaction fees |
|
$ |
1,102,000 |
|
|
$ |
1,137,000 |
|
Non-GAAP adjusted operating margin percentage |
|
|
17.7 |
% |
|
|
18.1 |
% |
Non-GAAP EPS:
The reconciliation of GAAP EPS to non-GAAP EPS as included in CSG’s 2024 full year financial guidance is as follows (in thousands, except per share amounts):
|
|
2024 Guidance Range |
|
|||||||||||||
|
|
Low Range |
|
|
High Range |
|
||||||||||
|
|
Amounts |
|
|
EPS (8) |
|
|
Amounts |
|
|
EPS (8) |
|
||||
GAAP net income |
|
$ |
76,500 |
|
|
$ |
2.64 |
|
|
$ |
83,700 |
|
|
$ |
2.91 |
|
GAAP income tax provision (7) |
|
|
30,400 |
|
|
|
|
|
|
|
33,200 |
|
|
|
|
|
GAAP income before income taxes |
|
|
106,900 |
|
|
|
|
|
|
|
116,900 |
|
|
|
|
|
Restructuring and reorganization charges |
|
|
12,000 |
|
|
|
|
|
|
|
12,000 |
|
|
|
|
|
Executive transition costs |
|
|
400 |
|
|
|
|
|
|
|
400 |
|
|
|
|
|
Acquisition-related expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets |
|
|
14,000 |
|
|
|
|
|
|
|
14,000 |
|
|
|
|
|
Earn-out compensation |
|
|
5,600 |
|
|
|
|
|
|
|
5,600 |
|
|
|
|
|
Transaction-related costs |
|
|
400 |
|
|
|
|
|
|
|
400 |
|
|
|
|
|
Stock-based compensation |
|
|
33,600 |
|
|
|
|
|
|
|
33,600 |
|
|
|
|
|
Non-GAAP income before income taxes |
|
|
172,900 |
|
|
|
|
|
|
|
182,900 |
|
|
|
|
|
Non-GAAP income tax provision (7) |
|
|
(49,300 |
) |
|
|
|
|
|
|
(52,200 |
) |
|
|
|
|
Non-GAAP net income |
|
$ |
123,600 |
|
|
$ |
4.25 |
|
|
$ |
130,700 |
|
|
$ |
4.55 |
|
(7) |
For 2024, the estimated effective income tax rates for GAAP and non-GAAP purposes are expected to be approximately |
(8) |
The weighted-average diluted shares outstanding are expected to be approximately 29 million. |
Non-GAAP Adjusted EBITDA:
CSG’s calculation of non-GAAP adjusted EBITDA and the reconciliation of CSG’s non-GAAP adjusted EBITDA measure to GAAP net income is provided below for CSG’s 2024 full year financial guidance (in thousands, except percentages):
|
|
2024 Guidance Range |
|
|||||
|
|
Low Range |
|
|
High Range |
|
||
GAAP net income |
|
$ |
76,500 |
|
|
$ |
83,700 |
|
GAAP income tax provision (7) |
|
|
30,400 |
|
|
|
33,200 |
|
Interest expense |
|
|
30,700 |
|
|
|
30,700 |
|
Interest and investment income |
|
|
(8,300 |
) |
|
|
(8,300 |
) |
GAAP operating income |
|
|
129,300 |
|
|
|
139,300 |
|
Restructuring and reorganization charges |
|
|
12,000 |
|
|
|
12,000 |
|
Executive transition costs |
|
|
400 |
|
|
|
400 |
|
Acquisition-related expenses: |
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets |
|
|
14,000 |
|
|
|
14,000 |
|
Earn-out compensation |
|
|
5,600 |
|
|
|
5,600 |
|
Transaction-related costs |
|
|
400 |
|
|
|
400 |
|
Stock-based compensation |
|
|
33,600 |
|
|
|
33,600 |
|
Amortization of other intangible assets |
|
|
11,400 |
|
|
|
11,400 |
|
Amortization of client contract costs |
|
|
22,000 |
|
|
|
22,000 |
|
Depreciation |
|
|
22,300 |
|
|
|
22,300 |
|
Non-GAAP adjusted EBITDA |
|
$ |
251,000 |
|
|
$ |
261,000 |
|
Non-GAAP adjusted EBITDA as a percentage of revenue less transaction fees (2) |
|
|
22.8 |
% |
|
|
23.0 |
% |
Non-GAAP Free Cash Flow:
CSG’s calculation of non-GAAP free cash flow and the reconciliation of CSG’s non-GAAP free cash flow measure to cash flows from operating activities is provided below for CSG’s 2024 full year financial guidance (in thousands):
|
|
2024 Guidance Range |
|
|||||
|
|
Low Range |
|
|
High Range |
|
||
Cash flows from operating activities |
|
$ |
120,000 |
|
|
$ |
170,000 |
|
Purchases of software, property and equipment |
|
|
(25,000 |
) |
|
|
(35,000 |
) |
Non-GAAP free cash flow |
|
$ |
95,000 |
|
|
$ |
135,000 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20241106240535/en/
For more information, contact:
John Rea, Head Investor Relations, Treasury and ESG Reporting
(210) 687-4409
E-mail: John.Rea@csgi.com
Davis Barker, Senior Manager, Investor Relations & Corporate Development
(303) 884-4506
E-mail: Davis.Barker@csgi.com
Source: CSG Systems International
FAQ
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