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    Globant Reports 2024 Third Quarter Financial Results

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    GLOBANT 

    Nov 14, 2024, 16:15 ET

    Strong, Broad Based Results

    • Third quarter revenues of $614.7 million, up 12.7% year-over-year
    • IFRS Diluted EPS of $0.98 for the third quarter
    • Non-IFRS Adjusted Diluted EPS of $1.63 for the third quarter

    LUXEMBOURG, Nov. 14, 2024 /PRNewswire/ — Globant (NYSE: GLOB), a digitally native company focused on reinventing businesses through innovative technology solutions, today announced results for the three and nine months ended September 30, 2024.

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

    Third Quarter 2024 Financial Highlights

    • Revenues rose to $614.7 million, representing 12.7% year-over-year growth.
    • IFRS Gross Profit Margin was 36.2% compared to 36.4% in the third quarter of 2023.
    • Non-IFRS Adjusted Gross Profit Margin was 38.5% compared to 38.2% in the third quarter of 2023.
    • IFRS Profit from Operations Margin was 10.6% compared to 9.7% in the third quarter of 2023.
    • Non-IFRS Adjusted Profit from Operations Margin was 15.6% compared to 15.3% in the third quarter of 2023.
    • IFRS Diluted EPS was $0.98 compared to $0.98 in the third quarter of 2023.
    • Non-IFRS Adjusted Diluted EPS was $1.63 compared to $1.48 in the third quarter of 2023.

    Nine months ended September 30, 2024 Financial Highlights

    • Revenues rose to $1,773.2 million, representing 17.0% year-over-year growth.
    • IFRS Gross Profit Margin was 35.8% compared to 36.1% in the first nine months of 2023.
    • Non-IFRS Adjusted Gross Profit Margin was 38.2% compared to 38.2% in the first nine months of 2023.
    • IFRS Profit from Operations Margin was 9.4% compared to 9.5% in the first nine months of 2023.
    • Non-IFRS Adjusted Profit from Operations Margin was 15.2% compared to 15.1% in the first nine months of 2023.
    • IFRS Diluted EPS was $2.88 compared to $2.68 in the first nine months of 2023.
    • Non-IFRS Adjusted Diluted EPS was $4.67 compared to $4.12 in the first nine months of 2023.

    Other Metrics as of and for the quarter ended September 30, 2024

    • Cash and cash equivalents and Short-term investments were $213.5 million as of September 30, 2024, a decrease of $109.8 million from $323.3 million as of December 31, 2023, driven mainly by the expansion into new geographies and a number of M&A earnout payments. As of September 30, 2024, we had a total amount of $165 million drawn from our credit facility.
    • Globant completed the third quarter of 2024 with 29,998 Globers, 27,927 of whom were technology, design and innovation professionals.
    • The geographic revenue breakdown for the third quarter of 2024 was as follows: 55.7% from North America (top country: US), 21.8% from Latin America (top country: Argentina), 17.6% from Europe (top country: Spain) and 4.9% from New Markets1 (top country: Saudi Arabia).
    • Globant’s top customer, top five customers and top ten customers for the third quarter of 2024 represented 9.1%, 21.0% and 30.1% of revenues, respectively.
    • During the twelve months ended September 30, 2024, Globant served a total of 969 customers (with revenues over $100,000 in the last twelve months) and continued to increase its wallet share, with 331 accounts generating more than $1 million of annual revenues, compared to 305 for the same period one year ago.
    • In terms of currencies, 66.6% of Globant’s revenues for the third quarter of 2024 were denominated in US dollars.

    “As we reflect on another remarkable quarter, I am thrilled to share that Globant continues on a trajectory of strong growth, solidifying our role as an industry leader. The level of demand we are witnessing across verticals and markets fuels our optimism for continued expansion in 2024. Our strategic investments in AI have lead to year-to-date AI-related initiatives increasing by 120% compared to the same period last year, enhancing our capabilities and driving productivity gains that translate into unique client experiences. With a strong pipeline and a commitment to redefining industries through our Studios, we are well-positioned to lead in this new era of digital innovation,” said Martín Migoya, Globant’s CEO and co-founder.

    “As we conclude this quarter, I am pleased to report that Globant has achieved another quarter of record revenues, at $614.7 million, reflecting strong sequential growth driven by our top client and several key accounts. This performance aligns with our guidance and showcases our ability to enhance profitability while maintaining a prudent balance sheet. Our healthy margins are a reflection to our focus on profitability, while we see early recovery signs in specific verticals that previously faced headwinds. We are confident in our ability to sustain this momentum and build on our strong performance as we approach 2025,” explained Juan Urthiague, Globant’s CFO.

    2024 Fourth Quarter and Full Year Outlook

    Based on current market conditions, Globant is providing the following estimates for the fourth quarter and the full year of 2024:

    • Fourth quarter 2024 Revenues are estimated to be in the range of $642.0 million to $648.0 million, or 10.6% to 11.6% year-over-year growth.
    • Fourth quarter 2024 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 15.0% to 16.0%.
    • Fourth quarter 2024 Non-IFRS Adjusted Diluted EPS is estimated to be in the range of $1.71 to $1.75 (assuming an average of 44.7 million diluted shares outstanding during the fourth quarter).
    • Fiscal year 2024 Revenues are estimated to be in the range of $2,415.0 million to $2,421.0 million, implying a 15.2% to 15.5% year-over-year revenue growth.
    • Fiscal year 2024 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 15.0% to 15.5%.
    • Fiscal year 2024 Non-IFRS Adjusted Diluted EPS is estimated to be in the range of $6.37 to $6.43 (assuming an average of 44.5 million diluted shares outstanding during 2024).

    Conference Call and Webcast

    Martin Migoya, Globant’s CEO and co-founder, Juan Urthiague, Globant’s CFO, Patricia Pomies, Globant’s COO, and Diego Tártara, Globant’s  CTO, will discuss the third quarter 2024 results in a video conference call today beginning at 4:30pm ET.

    Video conference call access information is:
    https://more.globant.com/F3Q24EarningsCall
    Webcast http://investors.globant.com/ 

    About Globant (NYSE:GLOB)
    At Globant, we create the digitally-native products that people love. We bridge the gap between businesses and consumers through technology and creativity, leveraging our expertise in AI. We dare to digitally transform organizations and strive to delight their customers.

    We have more than 29,900 employees and we are present in more than 30 countries across 5 continents working for companies like Google, 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 IFRS Accounting Standards as issued by the International Accounting Standards Board (“IASB”), applicable to interim periods, 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, acquisition-related charges, 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 condensed interim consolidated statements of financial position as of September 30, 2024 and December 31, 2023 and its condensed interim consolidated statements of comprehensive income for the three and nine months ended September 30, 2024 and 2023, prepared in accordance with International Accounting Standard (“IAS”) 34, “Interim Financial Reporting”.

    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, acquisition-related charges, 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: 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.
    Condensed Interim Consolidated Statements of Comprehensive Income
    (In thousands of U.S. dollars, except per share amounts, unaudited)
    Nine Months EndedThree Months Ended
    September 30, 2024September 30, 2023September 30, 2024September 30, 2023
    Revenues1,773,2061,515,234614,667545,282
    Cost of revenues(1,139,161)(967,794)(392,392)(346,980)
    Gross profit634,045547,440222,275198,302
    Selling, general and administrative expenses(460,877)(390,064)(154,178)(142,531)
    Net impairment losses on financial assets(8,994)(13,979)(3,667)(2,621)
    Other operating income and expenses, net2,738614777—
    Profit from operations166,912144,01165,20753,150
    Finance income3,8763,5001,3491,324
    Finance expense(20,536)(15,063)(7,034)(5,661)
    Other financial results, net7,34111,4731,7353,044
    Financial results, net(9,319)(90)(3,950)(1,293)
    Share of results of investment in associates161185105170
    Other income and expenses, net6,1424,075(4,464)2,774
    Profit before income tax163,896148,18156,89854,801
    Income tax(34,401)(31,067)(11,357)(10,978)
    Net income for the period129,495117,11445,54143,823
    Other comprehensive income, net of income tax effects
    Items that may be reclassified subsequently to profit and loss:
    – Exchange differences on translating foreign operations(20,458)(28,761)22,555(30,013)
    – Net change in fair value on financial assets measured at FVOCI1,019(2,316)—15
    – Gains and losses on cash flow hedges(12,768)117365(3,762)
    Total comprehensive income for the period97,28886,15468,46110,063
    Net income attributable to:
    Owners of the Company127,324116,40543,60642,993
    Non-controlling interest2,1717091,935830
    Net income for the period129,495117,11445,54143,823
    Total comprehensive income for the period attributable to:
    Owners of the Company94,86485,27864,26610,251
    Non-controlling interest2,4248764,195(188)
    Total comprehensive income for the period97,28886,15468,46110,063
    Earnings per share
    Basic2.942.741.001.01
    Diluted2.882.680.980.98
    Weighted average of outstanding shares (in thousands)
    Basic43,24842,47443,41942,696
    Diluted44,27143,44244,44243,664
    Globant S.A.
    Condensed Interim Consolidated Statements of Financial Position as of September 30, 2024 and December 31, 2023
    (In thousands of U.S. dollars, unaudited)
    September 30, 2024December 31, 2023
    ASSETS
    Current assets
    Cash and cash equivalents199,031307,223
    Investments14,42516,070
    Trade receivables631,632499,283
    Other assets24,03331,753
    Other receivables60,41754,786
    Other financial assets3,79515,418
    Total current assets933,333924,533
    Non-current assets
    Investments2,2121,833
    Other assets6,3584,088
    Other receivables28,63426,475
    Deferred tax assets67,52860,777
    Investment in associates1,5871,426
    Other financial assets37,01034,864
    Property and equipment152,440162,736
    Intangible assets286,161285,661
    Right-of-use assets124,159119,400
    Goodwill1,259,6221,105,073
    Total non-current assets1,965,7111,802,333
    TOTAL ASSETS2,899,0442,726,866
    LIABILITIES
    Current liabilities
    Trade payables102,202124,545
    Payroll and social security taxes payable225,193221,843
    Borrowings186,284156,916
    Other financial liabilities105,47368,750
    Lease liabilities29,74447,852
    Tax liabilities25,85833,229
    Income tax payable11,04311,287
    Other liabilities465896
    Total current liabilities686,262665,318
    Non-current liabilities
    Trade payables2,6272,981
    Borrowings1,2202,191
    Other financial liabilities117,132135,238
    Lease liabilities90,42170,884
    Deferred tax liabilities18,38121,098
    Income tax payable6,526—
    Payroll and social security taxes payable5,0505,139
    Provisions for contingencies17,36728,336
    Total non-current liabilities258,724265,867
    TOTAL LIABILITIES944,986931,185
    Capital and reserves
    Issued capital52,28651,705
    Additional paid-in capital1,087,7111,022,918
    Other reserves(74,508)(42,048)
    Retained earnings824,413697,089
    Total equity attributable to owners of the Company1,889,9021,729,664
    Non-controlling interests64,15666,017
    Total equity1,954,0581,795,681
    TOTAL EQUITY AND LIABILITIES2,899,0442,726,866
    Globant S.A.
    Selected Cash Flow Data
    (In thousands of U.S. dollars, unaudited)
    Three Months Ended
    September 30, 2024September 30, 2023
    Net Income for the period45,54143,823
    Non-cash adjustments, taxes and others76,81953,723
    Changes in working capital(31,823)(10,141)
    Cash flows from operating activities90,53787,405
    Capital expenditures(20,810)(26,758)
    Cash flows from investing activities(89,596)(140,663)
    Cash flows from financing activities41,0447,931
    Net increase/decrease in cash & cash equivalents41,985(45,327)
    Globant S.A.
    Supplemental Non-IFRS Financial Information
    (In thousands of U.S. dollars, unaudited)
    Nine Months EndedThree Months Ended
    September 30, 2024September 30, 2023September 30, 2024September 30, 2023
    Reconciliation of adjusted gross profit
    Gross profit634,045547,440222,275198,302
    Depreciation and amortization expense25,41520,6129,4577,579
    Share-based compensation expense – Equity settled18,01010,9765,1092,198
    Adjusted gross profit677,470579,028236,841208,079
    Adjusted gross profit margin38.2 %38.2 %38.5 %38.2 %
    Reconciliation of selling, general and administrative expenses
    Selling, general and administrative expenses(460,877)(390,064)(154,178)(142,531)
    Depreciation and amortization expense74,75161,50124,24421,012
    Share-based compensation expense – Equity settled42,72241,44216,00816,447
    Acquisition-related charges (a)17,23014,4881,6465,370
    Adjusted selling, general and administrative expenses(326,174)(272,633)(112,280)(99,702)
    Adjusted selling, general and administrative expenses as % of revenues(18.4) %(18.0) %(18.3) %(18.3) %
    Reconciliation of adjusted profit from operations
    Profit from operations166,912144,01165,20753,150
    Share-based compensation expense – Equity settled60,73252,41821,11718,645
    Acquisition-related charges (a)42,66832,5779,78811,435
    Adjusted profit from operations270,312229,00696,11283,230
    Adjusted profit from operations margin15.2 %15.1 %15.6 %15.3 %
    Reconciliation of net income for the period
    Net income for the period127,324116,40543,60642,993
    Share-based compensation expense – Equity settled60,61852,37721,19218,628
    Acquisition-related charges (a)41,33430,63914,9549,878
    Tax effect of non-IFRS adjustments(22,516)(20,380)(7,399)(6,720)
    Adjusted net income206,760179,04172,35364,779
    Adjusted net income margin11.7 %11.8 %11.8 %11.9 %
    Calculation of adjusted diluted EPS
    Adjusted net income206,760179,04172,35364,779
    Diluted shares44,27143,44244,44243,664
    Adjusted diluted EPS4.674.121.631.48
    (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, interest charges on acquisition-related indebtedness, external deal costs, acquisition-related retention bonuses, integration costs, changes in the fair value of contingent consideration liabilities, 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.
    Globant S.A.
    Schedule of Supplemental Information (unaudited)
    MetricsQ3 2023Q4 2023Q1 2024Q2 2024Q3 2024
    Total Employees27,50529,15028,99129,11229,998
    IT Professionals25,57527,11626,93327,13327,927
    North America Revenues %58.957.456.056.355.7
    Latin America Revenues %21.622.922.923.021.8
    Europe Revenues %15.915.817.216.917.6
    New Markets Revenues %3.63.93.93.84.9
    USD Revenues %72.568.668.467.166.6
    Other Currencies Revenues %27.531.431.632.933.4
    Top Customer %8.78.28.38.39.1
    Top 5 Customers %22.521.421.821.021.0
    Top 10 Customers %32.230.830.130.330.1
    Customers Served (Last Twelve Months)*889930955958969
    Customers with >$1M in Revenues (Last Twelve Months)305311318329331
    (*) Represents customers with more than $100,000 in revenues in the last twelve months.

    Investor Relations Contact:
    Arturo Langa, Globant 
    investors@globant.com
    +1 (877) 215-5230

    Media Contact:
    Wanda Weigert, Globant
    pr@globant.com
    +1 (877) 215-5230

    1Represents Asia, Oceania and the Middle East.

    SOURCE GLOBANT

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