Information Services Group, Inc.

Q4 2022 Earnings Conference Call


spk_0: hello good morning my name is barry holt i'm a senior communications executive or i see i like to welcome everyone to eyes she's fourth quarter conference call and joined today by michael thomas chairman and chief executive officer and burn up on so executive vice president and chief financial officer before we begin i'd like to read a forward looking statements it is important to note that this communication may contain forward looking statements which represents the current expectations and beliefs of the management of see concerned future events in their potential effects the statements are not guarantees of feature results and a subject to certain risks and uncertainties at could cause actual results to differ materially the those anticipate for more detail listing of risks other factors that could affect each results please refer to forward looking statements contained on our form a ak that was furnished last night of the fcc and the respect the section i she's for ten k covering for year results you should also read she's a new report on for ten k and any other relevant documents including any amendments are several it's these documents filed with the fcc you'll be able to obtain free copies of an easy a biases se si filings any their eyes she's website is w w dot i stds one dot com or the as he sees website is w w
spk_1: da se si dot gov
spk_0: i see as it takes no obligation to update or revise a forward looking statements to reflect subsequent events or circumstances during this cause we will discuss certain i gaf financial measures which i see believes improves the compare ability of the company's financial results between periods and provides for greater transparency of key measures used to evaluate to come please performance the not get measures which we'll touch on to they include adjusted ebitda adjusted net earnings and the presentation of selected financial data and a constant currency basis nine get measures are provided as additional information and could not be considered an isolation or as a substitute for financial results prepared in accordance with go for the reconciliation whole not get measures presents and most costly applicable gap measure please refer to our current report on form a cake which was filed last night with the fcc and now i'd like to turn the and of michael cars though we followed by birth alfonso my
spk_2: thank you very good morning everyone today we will review our record results for the fourth quarter and four year or continued recurring revenue growth our new enhanced image credit facility
spk_3: and our outlook for the first quarter
spk_2: i have she delivered our best quarterly and for your performance than seventy year history
spk_3: for the corner i as she delivered record revenues and seventy four million dollars of eleven percent and constant currency
spk_2: record net income a four point three million up twenty percent
spk_3: record earnings per share of nine cents
spk_2: record adjusted earnings per share of thirty cents and record adjusted eva dob eleven million dollars of nine percent our key metrics for equally impressive for the four year with record revenues of two hundred and eighty six million dollars of eight percent and constant currency
spk_4: record operating income of twenty nine million dollars up seventeen percent
spk_3: record net income of twenty million dollars up twenty seven percent record adjusted net income of twenty seven million dollars up eighteen percent record earnings per share of thirty nine cents record adjusted earnings per share of fifty three cents and record adjusted a bit off forty three million dollars up eleven percent our record for quarter and for your results were accomplish despite an uncertain macro environment
spk_2: and fewer working days into for normally a seasonally lower corner variety
spk_3: but our diverse and valued sweet of products and services
spk_4: from past optimization the business transformation is making a difference in our performance
spk_3: looking at a fourth quarter are top line growth was driven by double digits operating growth and bought the americans in europe as clans demand for efficiency and optimization services escalate we also saw strong growth our subscription services and research and governance
spk_2: and in network and software advisory services during the quarter our recurring revenue into for reach thirty million dollars up twenty six percent over the prior year
spk_3: and represented forty percent of our from wide ravenous
spk_2: for the year we achieved one hundred and eight million dollars and recurring revenue surpassing the one hundred million dollar goal we set ourselves back in twenty twenty not surprisingly fx continues to chip away at all reported results for the quarter the impact revenue with four hundred and forty seven basis points or three point two million dollars and thirty million dollars for the full year
spk_3: overall are more profitable mex of products and services
spk_2: combined with the operating efficiencies we derive from or i s t next operating model resulted in the highest for your he but ah margin in our farms history as fifty percent from a client perspective we serve five hundred and fifty six clients and queue for up six percent
spk_3: and surpass nine hundred clients for the year a new high for our farm
spk_2: today nearly every one of our clients is a digital business
spk_3: each is using digital technology to redefine how they operate how they engage with customers employees and business partners and how they create new revenue streams through connected products and services even in uncertain times our clients for committed to continuous digital transformation
spk_4: markets and technology are changing fast there's really no time to hit pause every business needs to keep moving forward or be left behind
spk_2: with intense market pressure to invest in cloud analytics customer experience and ai our clients are twenty to i as to help them optimize their costs not only to get lean but to free up resources to fund their digital ambitions to meet this need i as she introduced a wide ranging cost transformation service
spk_3: the bills upon our lawns longstanding expertise in this area
spk_2: are offering very successful today focus is on the for lovers to optimize cost
spk_4: the supplier ecosystem technology investments
spk_3: software asset management and business operations this approach delivers both short and long term he fishes and reduces the peaks and valleys of traditional linear spend models
spk_4: as i mentioned these continuous savings can be reinvested in our clients business
spk_2: particularly for ongoing digital transformation this is another example of how our seventy year history a be the largest sourcing advisor in the world is paying off
spk_3: revenues from our cost affirmations of optimization services
spk_4: are growing by double digits
spk_2: among our major engagement we are helping a global health care solutions company
spk_4: reduces forty million dollars of technology costs like twenty five percent and an automotive supplier reduce reduces one hundred and forty million dollars spent by twenty percent
spk_3: there are many more such opportunities in progress and in our pipeline
spk_2: turning our region's the americas delivered forty four million dollars of revenue in the quarter up twelve percent versus the prior year on the strength of our digital and costs optimization offering
spk_4: during the quarter we saw double digit growth in our media health sciences energy and utilities industry
spk_2: and among our services network and software advisory research and govern governor were also have double digits key point is gaze which during the fourth quarter included mckesson
spk_4: striker excellent advice or as i mentioned demand for govern acts are sas base vendor compliance and risk management platform is soaring his client's fee to get the most value out of their supplier ecosystem during the quarter a global hospitality giant reviewed say annual million dollar plus i to govern x subscription at a higher rate for twenty twenty three
spk_3: this coin is one of our longest standing govern x clients generating more than twenty five million dollars and recurring revenue over the last ten years
spk_4: we also extended ah i see govern next contract
spk_2: with one of the palm three global tech giants in the world for a further four years with a significant increase in annual contract value i see also won a new multi million dollar i as she govern acts engagement with a major us healthcare company to provide our unique vendor management office as a service capability additionally i assume research has signed a large deal worth more than one point five million dollars
spk_3: with a leading services tech provider for a range of go to market projects and i have see solutions including a multiyear i see pro benchmark contract
spk_5: now starting to europe
spk_2: a few for revenues and twenty four million dollars were up twelve percent in constant currency over last year
spk_3: for the quarter europe delivered double digit revenue growth in our media public sector consumer services and manufacturing industry verticals
spk_4: and in our governor and network and software advisory businesses
spk_2: he klein engagements in europe and the fourth quarter included volkswagen
spk_4: deutsche your bon ali on
spk_6: and naturally
spk_2: during the quarter a leading transportation companies germany extended the digital labor and automation engagement it awarded i see and late twenty twenty for an additional two years i you will continue as the clients for tv automation adviser delivery platform as a service maintenance and licensing services we also secured a major deal with a global chemicals and indus in industrial solutions manufacturer in germany to provide network advisory services additionally i as he has been awarded a significant million dollar plus engagement with the swiss federal office of information technology systems and telecommunications we are helping this client optimize their technology portfolio restructure there what underlying cause models and redefined or organizational structure to ensure lasting improvement
spk_3: now turning to asia pacific key for revenues and seven million dollars were a five percent in constant currency from last year with double digit growth in our network and software advisory business
spk_2: asia pacific has been a strong performer this year with boy revenues of sixteen percent in constant currency
spk_4: in the latest quarter we saw double digit growth and our consumer and media industry verticals
spk_2: key points and a quarter he quoted the australian taxation office hi grieve and insurance company pooper thirty now to another very positive development bri as we recently announced that we were able to successfully amend our one hundred and forty million dollar credit agreement
spk_4: that more favorable palms
spk_2: this was made possible by are strong financial position and operating results
spk_3: the new agreement converts the previous farm and revolving loan
spk_2: into an all revolving credit facility eliminate four point three million dollars a mandatory and annual principal payments under the former agreement and extends the maturity date by three years to february twenty twenty eight
spk_3: this is clearly an excellent outcome especially during a time of increasing interest rates and evolve hall debt markets
spk_2: now let me turn to guidance continuous digital transformation remains a business imperative
spk_4: and i have she's is ideally positioned to meet that need
spk_2: in addition we see continuing continually strong demand for services as we help our clients optimize their technology and business environments divine their future operating state and leverage the technology and services that will help them realize their objectives what are your had to twenty twenty three our demand pipeline remained strong indeed we hired additional always into forward to meet future demand we're also mindful of the economic factors that could impact the timing of client decision making
spk_4: including inflation the possibility recession geo political concerns and talent shortages
spk_3: in consideration of all this for the first quarter we are targeting revenues of between seventy three and seventy five million dollars
spk_4: including a negative aspects impact of approximately two hundred basis points in this range and adjusted either da between ten and eleven million dollars
spk_2: so if that let me turn the call over to burn who will summarize our financial results
spk_7: mark
spk_4: well thank you mike and and morning everyone
spk_3: as mike mentioned i see continues to have momentum in the market leading to a record breaking quarter and year
spk_4: that is the fourth quarter were seventy four point two million of seven percent on reporters basis and of eleven percent a constant currency basis compared with the fourth quarter last year
spk_3: currently negatively impacted reported ready by three point two million versus the prior year
spk_4: the america support families for forty three point six million of twelve percent versus the prior year and europe revenues were twenty three point nine million of one percent on reported basis
spk_8: and of twelve percent in constant currency
spk_4: and asia pacific revenues were six point seven million down four percent reported and a five percent in constant currency fourth quarter just to see but i was eleven point one million of nine percent from last year resulting and he had a margin of fifteen percent of thirty three basis points compared with the prior year fourth quarter in constant currency is just to keep it i with have seventeen percent for full year
spk_3: for for operating income increased slightly to seven point two million compare with some point one million in the prior year
spk_2: the income for the quarter with four point three million or nine cents or fully the would share of twenty percent over net income a three point six million or seven cents per fully diluted share in the prior year
spk_9: for for adjusted net income with six point five million or thirty cents or fully diluted share
spk_3: i'd for good basis for a twenty seven percent from adjusted net income of five point one million or ten cents to fully diluted share in the prior years fourth quarter
spk_4: head count as of december thirty first with five hundred and ninety six hundred ninety nine of sixty one professionals are four percent from two three of my mentioned earlier we added resources to gear up for future growth
spk_0: insulting utilization for the fourth quarter with sixty seven percent impacted by or additional hiring
spk_4: our full year utilization seventy three percent
spk_3: or balance you can choose to have the strength and flexibility support our business over the long term
spk_0: for the quarter next has provided by operations for six point six million and eleven point one million for the full year
spk_3: we entered the corner with thirty point six million cash of from nineteen point seven million as the end of the third quarter
spk_8: during the fourth quarter as she paid dividends totaling two million dollars
spk_4: our next quarterly dividend will be payable on march thirty first to shareholders of record on march twentieth
spk_0: in addition we pay two point five million related to the see forty acquisition
spk_7: borrowing nine million from our revolver to fund the acquisition and business operations
spk_4: we also pay down one point one million of debt
spk_3: and with our debt balance of seventy nine point two million or death even a is one point eight times a record low for your end
spk_4: are are boring way for the quarter with five point one percent up from one point nine percent last year
spk_0: and we have the according of the forty eight point three million shares outstanding
spk_10: michael now she's concluding remarks before we go to the human a sexy my
spk_2: thank you for to summarize our portfolio of cost optimization sourcing and digital transformation services is is a sweet spot for enterprises in today's environment
spk_3: as a result i as she delivered our best quarter and four year ever with record breaking revenues and profits and each period
spk_2: our key for recurring revenues were up double digits
spk_3: enabling us to exceed our one hundred million dollar for your target set back and twenty twenty
spk_2: recurring revenues were forty percent of our from whitehall one to for we navigated fx headwinds and other market uncertainties in the fourth quarter to deliver double digit operating growth in europe and the america and asia pacific had an outstanding year
spk_3: are strong financial position and operating performance allowed us to successfully amassed are one hundred and forty million dollar credit agreement
spk_2: giving us more flexibility to is vast and the continue growth of our farm and we see our momentum continuing with the potential of another record setting first quarter as always we are focused on creating shareholder value for the long term and we are steadfast in our mission to deliver operational excellence to our clients
spk_3: so thank you very much for polling in this morning
spk_11: and now let me turn the session over to our operator for your questions thank you if he likes walk your question please press star qualify one on the telephone keep as lot ritual your question please press stuff on it by to when asking your question please ensure your and me too loudly please let us have to two questions if you any flow least we join teeth as a reminder that stuff qualified one on the telephone keypad now
spk_12: our first question comes from vincent's collection of find some research vincent yolanda dyson please go ahead
spk_13: thanks for nice my square mike
spk_14: morty battle for me as i get a morning
spk_12: so what
spk_8: it sounds like allows the strength in the quarter was somewhat similar to last quarter you know cost optimization govern acts research
spk_4: i think network advisory was it was sort of a new area of strength is that ladder area have legs and are there any other areas i said i'm i'm mentioning that
spk_3: for new source of strength this quarter vs last and do they have legs swell yeah so yeah yeah good good point so past optimization and on the digital transformation front continues and and our definitely our network and software advisory business reminding you
spk_2: as the software advisory are all the software that enterprises purchase whether that's a sales force or or or or or or up our service now cetera we help them navigate the number of licenses the value the pricing etc as close as fits right in the cost optimization and then network
spk_3: which is a large spend some time the third largest ah tech spend in a lot of a large enterprises around the network around five g around data voice cetera or is does have legs we had an outstanding a fourth quarter and network and and software and we see both for those sitting right in to the current environment both in europe and in the us so we see a lot of ladies there and and are recurring revenue streams with our platform business like he acts and our research
spk_1: we see continued strength there as well so he couple that together with i think of a pretty yeah a pretty strong demand environments for the services in the sweetest services that we currently out
spk_15: is kind of them is is kind of pushing us to where we are a we were we are the early part twenty three
spk_12: and and what was what were the major margin
spk_4: improvement drivers what was it the mix and and if so well that makes also benefit you and twenty three
spk_2: why would say that the first thing is in our recurring revenue is ah or thirty million dollars would never been at that level and then she followed us for a while you'll go back maybe four or five years we might not have had thirty million dollars of ah
spk_4: we might not at thirty nine dollars a recurring revenue for having in the quarter number one that are recurring revenues are ah
spk_2: in our are clearly higher margin so as that continues to expand it's in one hundred million of our business now and that will continue to that will continue to definitely definitely grow so am i think that in the mix that we have with are you know kind of digital transformation which we can still sell at good premium
spk_16: in a levels on ice i think guy i think our margins you know should be continued be healthy
spk_12: as we move forward cry and then ah lastly
spk_17: what what are your thoughts on
spk_4: on acquisitions currently and in this pricing come in to make it more attractive
spk_18: area to to focus on capital issue
spk_4: yeah so we are as as you know we did does to last year with agreement and not she's for growth we are on the hot primarily around
spk_2: you know recurring revenue
spk_4: screams
spk_2: and and around digital and we are in the market and if we find something that you know is a win win for for us as well as the target than we will execute on that during twenty twenty three so we see the market you know most of ours are soulful worst
spk_12: and so it's a bit of a dance and is both an economic you know as well as kind of an emotional sale because all these teams tend to be owner operated the ones we are interested in
spk_19: but fell we think the market is is pretty good shape out there and we have our we have our spice that
spk_11: okay thank you i'll go back and the nice job
spk_20: thanks a lot and
spk_21: thankyou our next question comes from mark riddick of the don't see much feel unwelcome please go ahead
spk_22: for your mind
spk_23: and mark the morning or
spk_22: so i wanted to stretch and a couple of things and and and thank you for all the detail in and or congratulations on the on the getting the agreement
spk_24: done which is certainly encourage
spk_22: jesse
spk_3: times as whatever you talk a little bit about with those yellow those those activities of clients looking for call savings missions in the like as way just a little bit about ah
spk_4: sort of high you're seeing that shit play out ah and you know whether or not there any particular industries that have been maybe more the forefront of that process than others are sort of how you sort of see them use it year you're active in all industries and all geography saucepan a wondering if some what so the leading the charge more so than others
spk_2: yeah no good thanks smart good good good good question with let me give you a couple of examples ah and then all parts specifically about the industry so busy to one see owe very large top five insurance company globally called and and
spk_3: they asked us that look they have two hundred and twenty five million dollars of application expense and we think that that's the right number and if so if not do we think that we could take out at least twenty percent or forty million plus out of that and so he said lot less come will do a quick assessment for you will fish market against our data and we'll see what we can do in terms of our recommendations on application some kind of rationalization arm that's very typical that i'll be in all twenty twenty five weeks worth of work and based on our assessment we think will take fifty million dollars a cost out here in this particular example wants to take that money and move it over into digitizing a number of their processes as if
spk_2: the ticket or insurance company so that's one example there's an there's of in oh another example a large debate a large be done a lot of training on regulatory and on compliance we have a new service we launched last year call training as a service has ah were taking one of the top four banks in the world and and we are basically going to operate their training as a service on a fixed fee multi york on frat why because of the number of people the turn over the costs associated with it and we could do it more efficiently for them so there's another fluff of that i'm so if you look at the industries
spk_3: from are you know which one i would say or the hottest at the moment health sciences very hot
spk_2: so think about health care and former that area are very high i would say college twenty percent five plus row manufacturing back why because of efficiency and optimization you see some of the large major automobile companies doing some reductions are doing some by out why is that they're trying to go
spk_3: more efficient that up twenty percent media and the tech industry out west here are up almost forty percent again on a cost optimization i mentioned in my remarks one of the top tech three companies in the world has moved higher
spk_22: into our govern acts compliance regulatory governance areas the private equity channel mom is also very hot for us where we help them the two things on their targets and also on their access or or sprucing up their current portfolios so they can prepare for an accent it may be a year away based on the market and finally i would say the public sector mark the public sector globally arm is isn't pretty strong shape it is very sometimes by quarter because of that time
spk_25: ending of their of there are a peace but the public sector is also an area that we are seeing a lot of kind of automation digitization or sourcing efficiencies be be done now for those would be the highlighted kind of industry segments i thank god with i would mention mark
spk_26: that's really really helpful thank you and thence as what does this was your your comments on be as a the hiring that took place during the fourth where that clearly gives an indication of the demanded that you received some of your yeah you expect to see as just i continue into the new year or or or is there a little bit of a
spk_2: was after that are or how shall we be thinking about you know additional ah
spk_3: and actresses
spk_2: jesus
spk_3: yeah so ah veo we hired about sixty people and know and love in the fourth quarter on we hired about fifty and the third quarter we did hire january february we now think that at the levels we are roughly i'll call it is after that january february hiring that we
spk_4: we think we have kind of the portfolio we currently have want sure will do some surgical things were bidding on a business piece of business at four million dollars that can require of our from incremental power if we went up for those kinds of things we would add
spk_3: but i say kind of the you know where the sixteen hundred employees level probably sixty fifty or so
spk_2: but we think kind of in that range for the next few quarters is probably the right raise our unless we do when some of the large bed that we have out there that they may change that a little bit so we kind of we we hired i think i need this before a little unusual for us because we normally try to hire white
spk_22: that moment but we made the decision based on talent availability in the market in what other firms were doing we took advantage of it
spk_11: are we brought his talent maybe slightly ahead were would have some did have a load of productivity the downside for the quarter but we overcame all that clearly but that kind of where we would see it at the moment mark
spk_2: i saw thank you very much
spk_4: don't
spk_3: thank you our next question comes and says it's forms of stand excuse me say this yolanda been please go ahead
spk_2: nicer and more and crusader take my call and congrats on the the really strong quarter of just want to start the recurring revenue side effects of what are some of the see variables that are thrive and that that number higher and higher doesn't came to throw that number now that it's hit that yeah hundred million dollars yeah
spk_3: a good questions david so first of all what you know what are the what are the drivers behind
spk_2: just remind you that the key components is our platform business around govern acts around pro benchmark which is a which is it pricing fast platform
spk_4: and and of certainly our research which is a subscription and kind of our multiyear raymond what is driving the first one the government's standpoint is all around regulatory it's around compliance and is the ground governing the ecosystem which has become much more complex kind of post pandemic is as as
spk_2: his company said has brought now their supplier communities ecosystems gets to gets bigger he gets broader gets a little more challenging to manage the govern and comply and using our fat software plus our services that we have in bangalore india one or two people on the ground up the client sites
spk_3: that combination is driving the growth around that ticket or platform are are pro benchmark which is of pricing platform is hot because a lot of the tech providers think of accenture think of cap gemini make them some of the large telecom providers of they all want to understand what the price
spk_27: he a capabilities are out in the market so far one of the big tech providers and and i want to go it on a large automotive companies are piece of work they would understand what the pricing a capabilities and flexibility is our when you're doing their pursuit so those are some of the things that are driving is part of our platform or growth areas
spk_11: on recurring on research on clearly the the the need to understand and be informed regarding the emerging technologies where are the key players around in a cloud in cyber ah a workforce collaboration tools that are out there is more complex there's more of the
spk_2: them how does a raised how do they stack what is our perspective his views on it we call it the i as she provider lens ip else are all very hot and in the man or and that is driving some of that recurring revenue so you know our senses that we have a portfolio we tween our research
spk_3: search and or platform business that we will we think we will be able to continue our recurring revenue streams of will have on we've been working through this are just as we get a twenty twenty our plan is it may do we do our first quarter report as we will give you some guidance on kind of what we see the multiyear recurring revenue will be are and will probably said another goal for ourselves at that point in time and go and david that's very helpful thanks isn't that what lot more i click on get mentioned a your we signed a number of high fires obviously you're still getting on and on your contracts are you know costs are sweet given the current macro environment or you seen any requests for cars and those contracts
spk_28: that might be reflective of the companies trying to stay them both bad topic and like short contract once maybe not as for purples we have services anything like that
spk_27: not in our of govern acts i would say that you know there might be a little bit of a long gated
spk_29: process to get it closed and that's easily driven that when this is by and happens usually it takes you know a few more layers of approvals that maybe it didn't happen before so the cell cycle can be a little bit longer
spk_11: david but i would not say that the part of our agreements with be with would be laughs but but certainly we would see we would see and can see a little bit about longer cell cycle and we see approval level requiring a little more extra layers and we me
spk_30: out with you don't have a macro environment the moment
spk_11: that's on thank you i'll jump back into your
spk_3: thank you did thank you i'll and next question comes from joe gomez of noble capital markets kill your line is open please go ahead
spk_2: a good morning this is i just as for disillusioned for joe goes when the got your yeah on the quarter is was the year
spk_3: thanks are like
spk_31: so i just wanted to start off with i know at it he reckons cut a came and slightly higher he fact it was clear he was this is kind of like a lower they said wind or was recovered of the know that more that maybe work for another news
spk_11: yeah i mean i think it's to pull number one i think the mix of our of our cost off in the zeeshan
spk_7: services are are are in increasing demand number one on our platform services or fitting in the kind of the sweet spot if you think about it from an optimization standpoint if if you're dealing with ah on ecosystem of suppliers and your europe large multinational more
spk_32: the billion dollar or enterprise and your ecosystem is larger and broader you want to have a good understanding of the capabilities and what they're delivering are they delivering what they said they were going to deliver can i spruce that or streamline out of bed so those are the things that are kind of driving
spk_8: in i would say driving driving driving bad area that's probably how i would answer that question
spk_32: the a perfect thank you and i will add a didn't looking to the press least i didn't notice anything to say what are you share purchases like orders of kind of do to that changed for growth acquisition like can kind of what you get his plans for sheriff purchases not going to this nigger
spk_33: yeah i figured i'd give has exactly the way we thought about it we we were very focused on on the acquisition during the quarter in week with we concluded that at the end of october
spk_11: and done we you know we we we chose to use are cast proceeds from cash flow on that one we also think that this environment holding a lot more cash on the serves as well
spk_4: and you know are are are thinking around around by back isn't any different
spk_11: the our our strategy over time as to avoid dilution from stock comp and we don't do that quarter by quarter but we have that that's our long term objectives as part of our capital allocation so
spk_4: is exactly what you're thinking about
spk_0: okay perfect guess thank you and i just lastly if i let and
spk_4: oh yes kind of grizzlies and have hinted at something like a pretty unique a large directly enterprise nice the operation teacher cause one quarter is there something in any you're still looking into a be the sheer that say and sorry broke up just managed to say that one more time
spk_11: oh shit though i know he has briefly mentioned something regarding to uk operation's for at the transfer growth and eight as we wanted to create something more like the like a large red that like enterprise you something along those lines it as the guys are kind of looking at going into the are still no not not an operations per se are ya the to change for growth business was a us domestic business
spk_27: we do have organization chain management across both the us and and europe others it's bigger the us and so we see this acquisition as away with more resources more capabilities to expand further
spk_4: in in the uk and a gym and the market in general but not necessarily in a setting up anything other than we have today which is we are we have resources on the ground we to see it as a way to expand our business more globally than what we have today
spk_2: like a perfect course if they if they get so much and grass gets that is it
spk_4: and you as a reminder if you have any for the last piece festival for of by one so he joined the kids
spk_3: our next question is from michael matheson of singular research michael yolanda spoken please go ahead congratulations on those numbers gentleman the i agree quarter great year
spk_34: regarding some like a longer sales are good regarding some of the longer snail cycle and that you describe yourself beginning to see are there any particular industry verticals where you see more advanced than others
spk_11: no this that question as i think the answer is is no and i only comment on it based on the question that was their arm and i would say is not prevail and on though a long a to cell cycle
spk_27: there is a little more multiple layers of approval saw it will take a little in order to get a little bit longer but i don't think there's any one industry that that is longer than the other i just think it's it takes a little bit longer by having says that you can see through our results none of that really sparked are demand
spk_2: environment and and delivering what we are delivering now it might change something being sold in a march vs an april or something like that but it's not going to stop say all as you well as right now the suite of services that we have our right in the sweet spot of what people are a lucky to do i gave a couple of examples
spk_3: the insurance company him and the end and and the others
spk_4: so there's a lot of there's a lot of movement to trying to take cost out but to take it out and move it into something that they can help try to drive growth on the top line
spk_3: the digitization the customer experience areas are analytics to help them better understand modernizing technology as i mentioned to earlier the example with the applications so no no industry specific i would say on that michael
spk_35: great thank you
spk_36: one last question i you mentioned a new service training as a service
spk_11: i just respond it's a great idea i wonder if it's something that you can now leverage to have your banks or potentially other industries like brokerage yeah look at a very good question and is emerging and we think this is beyond his financial services are we are in the process of of pop up including in finding another large financial services farm but i would also say we have moved this now into the health sciences area as you know there's a lot of kind of compliance around drugs etc and we are beginning to get traction in that area so we we think that this is a multiple industries solution
spk_37: it's a merging but we think this could be a fast growing segment for us over the next two to three years so i think you're on the right track their but i think it's not only financial services or staying in our health sciences and we think there's a few others that will take us up on this as the or progress is not keep everyone post
spk_0: on them
spk_8: good luck with that again it's a great idea thank you for taking my questions
spk_0: yeah thanks michael
spk_8: thank you michael as a reminder he was to submit a follow up question please my staff qualify as one on the telephone keypad now i see we have a follow up from david still understand it qc david yolanda been please go ahead
spk_27: hi jake just pile power on the fevers have any thoughts on ah
spk_38: from a complex perspective there's anything unusual we should is in an eye out for a why three
spk_11: ah no the road i would say
spk_2: overall were very lean on capital were very little real estate in our capital intensive fluctuate between two or three million with a little bit higher in twenty two know we upgraded some of our county and and and hr systems

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