Ibex Ltd at Robert W Baird Global Consumer, Technology & Services Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Dave Koning - William Baird - Analyst : So with that, why don't I turn it over, maybe we can just kind of kick it off with, maybe review a little what you do and maybe that what's on everybody's mind lately, AI and how that's kind of affecting kind of what you guys do.

Question: Dave Koning - William Baird - Analyst : Yeah. Thank you for that. And maybe we can talk also a little bit about the macro, because I would say you and some of your competitors had a little slower trends this past quarter and I think sometimes the investment community looks at that and says, oh, this is the beginning of AI setting, but it seems completely different. It's just a separate issue a little bit, but maybe talk a little bit about macro.

Question: Dave Koning - William Baird - Analyst : Yeah. And we'll maybe turn back to macro a bit in a minute, but your margin comment's a really good one. What do you think is happening in the business? Is it a combination of, you know, there was wage inflation for a while that should have presented a headwind to margins, but maybe you're able to price a little more, a little later, and then that lifts it? Or maybe the mix shift? I know utilization is getting probably a lot better in Latin America. What are all the drivers that are doing that?

Question: Dave Koning - William Baird - Analyst : And it seems to, like, growth is positioned well, especially as you're starting the anniversary, or at least get out of some of the older contracts. You often talk about BPO 2.0. I think it's over 80% of revenue now. Does that correlate with the 80% of revenue that's in offshore locations?

Question: Dave Koning - William Baird - Analyst : Yeah, that makes sense. And can you maybe just talk through a little bit about -- just so the audience understands, and maybe a lot of people do already, but why the Philippines or Latin America, why offshore locations are so powerful? Maybe a little bit of the economics of how it works.

Question: Dave Koning - William Baird - Analyst : And what's your mix right now of seats between US, nearshore, and Philippines?

Question: Dave Koning - William Baird - Analyst : And is there, you know, you talked a lot about the companies you serve tend to be a little bit faster growers. And even though you're smaller than some of the really big BPO companies, you've tended to take share. Maybe talk through what is it about IBEX that's allowed you guys to take share? And how does that set up for the future?

Question: Dave Koning - William Baird - Analyst : And let's just say the industry grows 5% or so. I mean, it's been kind of a GDP industry. And what's interesting about it is you go back to when the internet started. And people thought, oh, this industry's dead. People are going to figure out how to find stuff on the internet. Then, when phones happened, people are going to figure out how to do it. And yet, it just has continued. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2023 / 5:25PM, IBEX.OQ - Ibex Ltd at Robert W Baird Global Consumer, Technology & Services Conference So AI, to me, kind of seems like, okay, it's another trend. But people keep having to call because of all the complexity. How do you see, A, do you think this will continue to be a good industry for many years to come? And how fast do you grow in a market that's growing fast?

Question: Dave Koning - William Baird - Analyst : Got you. What about from a vertical perspective? It seems like there's a little bit of divergence in trends right now. I think tech can travel slower. I think health and maybe fintech a little faster, but maybe walk through how you think of those different verticals, why they've diverged a little bit, and kind of how the future looks.

Question: Dave Koning - William Baird - Analyst : Got you. And this year your new logo revenue, I think you said $30 million to $35 million, last year was $50 million. How's your pipeline today and kind of what should we expect the next few years?

Question: Dave Koning - William Baird - Analyst : That's client retention or is that client, like, revenue retention?

Question: Dave Koning - William Baird - Analyst : So what do you think -- if you think existing -- if we think existing volume, like, net growth, or existing revenue net growth, plus new logos, if you do $500 million of revs, give or take, right, $30 million, so you're adding 6%, 7% from new revenue, new client revenue, how much existing client revenue growth do you get each year about?

Question: Dave Koning - William Baird - Analyst : It's great. So you think, going forward, the next few quarters, whatever it is, a little lower than 10%, but the margin, you don't see any real reason that margins are going to tick down after this good year. They can keep kind of moving up?

Question: Dave Koning - William Baird - Analyst : Yeah, and your point's a good one, too. It's like maybe you're not going to grow 10% because the macro is not perfect, but let's just say it's five. If you get huge margin expansion, I mean, it's going to pay for itself.

Question: Dave Koning - William Baird - Analyst : And what's your offshore capacity utilization today, and where can it go? (multiple speaker) REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2023 / 5:25PM, IBEX.OQ - Ibex Ltd at Robert W Baird Global Consumer, Technology & Services Conference

Question: Dave Koning - William Baird - Analyst : In 80s% normal.

Question: Dave Koning - William Baird - Analyst : That's great. Do you think there's a -- so getting back a little bit to AI and offshoring, so if offshoring can save 50% or 65%, kind of depending where you're going, AI is viewed to save another leg. Is there almost something to the fact of, hey, if we're already doing this in the Philippines and saving you a ton of money, even if AI comes in, there's sort of this, can we really save that much more? Can you double the benefits and make it so that it ends up being close to free at some point or -- you know what I mean?