UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 4, 2015
Sykes Enterprises, Incorporated
(Exact name of registrant as specified in its charter)
Florida | 0-28274 | 56-1383460 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
400 N. Ashley Drive, Suite 2800, Tampa, Florida |
33602
| |
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: (813) 274-1000
(Former name or former address if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On May 4, 2015, Sykes Enterprises, Incorporated issued a press release announcing its financial results for the three months ended March 31, 2015. The press release is attached as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(d) | The following exhibit is included with this Report: |
Exhibit 99.1 Press release, dated May 4, 2015, announcing the financial results for the three months ended March 31, 2015.
(Remainder of page intentionally left blank.)
-2-
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
SYKES ENTERPRISES, INCORPORATED | ||||
By: | /s/ John Chapman |
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John Chapman | ||||
Executive Vice President and | ||||
Chief Financial Officer |
Date: May 4, 2015
-3-
EXHIBIT INDEX
Exhibit No. | Description | |
99.1 |
Press release dated May 4, 2015, announcing the financial results for the three months ended March 31, 2015. |
-4-
Exhibit 99.1
news release
FOR IMMEDIATE RELEASE |
MAY 4, 2015 |
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5
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Sykes Enterprises, Incorporated
Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
Exhibit 1
Three Months Ended | ||||||||||||
March 31, 2015 |
March 31, 2014 |
December 31, 2014 |
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Revenues |
$ | 323,685 | $ | 324,429 | $ | 349,925 | ||||||
Direct salaries and related costs |
(213,927) | (221,625) | (227,802) | |||||||||
General and administrative |
(72,727) | (73,377) | (77,074) | |||||||||
Depreciation, net |
(11,059) | (11,298) | (11,227) | |||||||||
Amortization of intangibles |
(3,431) | (3,651) | (3,489) | |||||||||
Net gain (loss) on disposal of property and equipment |
- | - | 2,225 | |||||||||
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Income from operations |
22,541 | 14,478 | 32,558 | |||||||||
Total other income (expense), net |
(1,102) | 395 | (1,456) | |||||||||
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Income before income taxes |
21,439 | 14,873 | 31,102 | |||||||||
Income taxes |
(5,800) | (4,560) | (8,599) | |||||||||
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Net income |
$ | 15,639 | $ | 10,313 | $ | 22,503 | ||||||
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Net income per share: |
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Basic: |
$ | 0.37 | $ | 0.24 | $ | 0.53 | ||||||
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Diluted: |
$ | 0.37 | $ | 0.24 | $ | 0.53 | ||||||
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Weighted average shares outstanding: |
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Basic |
42,181 | 42,739 | 42,280 | |||||||||
Diluted |
42,440 | 42,837 | 42,533 |
7
Sykes Enterprises, Incorporated
Segment Results
(in thousands, except per share data)
(Unaudited)
Exhibit 2
Three Months Ended | ||||||||||||
March 31, 2015 |
March 31, 2014 |
December 31, 2014 |
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Revenues: |
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Americas |
$ | 264,173 | $ | 261,246 | $ | 285,494 | ||||||
EMEA |
59,495 | 63,183 | 64,431 | |||||||||
Other |
17 | - | - | |||||||||
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Total |
$ | 323,685 | $ | 324,429 | $ | 349,925 | ||||||
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Operating Income: |
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Americas |
$ | 32,541 | $ | 22,647 | $ | 41,473 | ||||||
EMEA |
3,788 | 2,884 | 4,799 | |||||||||
Other |
(13,788) | (11,053) | (13,714) | |||||||||
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Income from operations |
22,541 | 14,478 | 32,558 | |||||||||
Total other income (expense), net |
(1,102) | 395 | (1,456) | |||||||||
Income taxes |
(5,800) | (4,560) | (8,599) | |||||||||
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Net income |
$ | 15,639 | $ | 10,313 | $ | 22,503 | ||||||
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8
Sykes Enterprises, Incorporated Consolidated Balance Sheets (in thousands, except seat data) (Unaudited) Exhibit 3
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March 31, 2015 |
December 31, 2014 |
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Assets: |
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Current assets |
$ | 541,493 | $ | 550,086 | ||||||||
Property and equipment, net |
104,169 | 109,880 | ||||||||||
Goodwill & intangibles, net |
246,936 | 254,451 | ||||||||||
Other noncurrent assets |
26,486 | 30,083 | ||||||||||
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Total assets |
$ | 919,084 | $ | 944,500 | ||||||||
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Liabilities & Shareholders Equity: |
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Current liabilities |
$ | 153,024 | $ | 167,862 | ||||||||
Noncurrent liabilities |
118,134 | 118,420 | ||||||||||
Shareholders equity |
647,926 | 658,218 | ||||||||||
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Total liabilities and shareholders equity |
$ | 919,084 | $ | 944,500 | ||||||||
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Sykes Enterprises, Incorporated Supplementary Data
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Q1 2015 | Q1 2014 | |||||||||||
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Geographic Mix (% of Total Revenues): |
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Americas (1) |
82% | 81% | ||||||||||
Europe, Middle East & Africa (EMEA) |
18% | 19% | ||||||||||
Other |
0% | 0% | ||||||||||
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Total |
100% | 100% | ||||||||||
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(1) Includes the United States, Canada, Latin America, South Asia and the Asia Pacific (APAC) Region. Latin America, South Asia and APAC are included in the Americas due to the nature of the business and client profile, which is primarily made up of U.S. based clients.
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Q1 2015 | Q1 2014 | |||||||||||
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Vertical Industry Mix (% of Total Revenues): |
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Communications |
37% | 38% | ||||||||||
Financial Services |
23% | 26% | ||||||||||
Technology / Consumer |
19% | 16% | ||||||||||
Transportation & Leisure |
7% | 8% | ||||||||||
Healthcare |
6% | 6% | ||||||||||
Other |
8% | 6% | ||||||||||
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Total |
100% | 100% | ||||||||||
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Seat Capacity (2) | ||||||||||||
Q1 2015 | Q1 2014 | Q4 2014 | ||||||||||
Americas |
33,200 | 35,000 | 34,500 | |||||||||
EMEA |
6,700 | 6,200 | 6,500 | |||||||||
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Total |
39,900 | 41,200 | 41,000 | |||||||||
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Capacity Utilization | ||||||||||||
Q1 2015 | Q1 2014 | Q4 2014 | ||||||||||
Americas |
78% | 74% | 77% | |||||||||
EMEA |
88% | 85% | 90% | |||||||||
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Total |
80% | 76% | 79% | |||||||||
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(2) The seat capacity and capacity utilization data are related to the Companys brick-and-mortar call centers. At the end of the first quarter 2015, the Company had approximately 3,800 agent FTEs working virtually from home both in the U.S. and Canada.
9
Sykes Enterprises, Incorporated
Cash Flow from Operations
(in thousands)
(Unaudited)
Exhibit 4
Three Months Ended | ||||||||
March 31, 2015 |
March 31, 2014 |
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Cash Flow From Operating Activities: |
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Net income |
$ | 15,639 | $ | 10,313 | ||||
Depreciation |
11,255 | 11,539 | ||||||
Amortization of intangibles |
3,431 | 3,651 | ||||||
Amortization of deferred grants |
(199 | ) | (589 | ) | ||||
Changes in assets and liabilities and other |
(1,484 | ) | (8,758 | ) | ||||
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Net cash provided by operating activities |
$ | 28,642 | $ | 16,156 | ||||
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Capital expenditures |
$ | 10,869 | $ | 11,706 | ||||
Cash interest paid |
$ | 368 | $ | 445 | ||||
Cash taxes paid |
$ | 5,606 | $ | 3,796 |
10
Sykes Enterprises, Incorporated
Reconciliation of Non-GAAP Financial Information
(in thousands, except per share data)
(Unaudited)
Exhibit 5
Three Months Ended | ||||||||||||
March 31, | March 31, | December 31, | ||||||||||
2015 | 2014 | 2014 | ||||||||||
GAAP income from operations |
$ | 22,541 | $ | 14,478 | $ | 32,558 | ||||||
Adjustments: |
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Acquisition-related severance & consulting engagement costs |
- | - | - | |||||||||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
3,745 | 4,102 | 3,818 | |||||||||
Merger & integration costs |
- | - | - | |||||||||
EMEA restructuring |
- | - | - | |||||||||
Other |
- | - | (2,620) | |||||||||
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Non-GAAP income from operations |
$ | 26,286 | $ | 18,580 | $ | 33,756 | ||||||
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Three Months Ended | ||||||||||||
March 31, | March 31, | December 31, | ||||||||||
2015 | 2014 | 2014 | ||||||||||
GAAP net income, per diluted share |
$ | 0.37 | $ | 0.24 | $ | 0.53 | ||||||
Adjustments: |
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Acquisition-related severance & consulting engagement costs |
- | - | - | |||||||||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
0.06 | 0.06 | 0.06 | |||||||||
Merger & integration costs |
- | - | - | |||||||||
EMEA restructuring |
- | - | - | |||||||||
Other |
- | - | (0.04) | |||||||||
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Non-GAAP net income, per diluted share |
$ | 0.43 | $ | 0.30 | $ | 0.55 | ||||||
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11
Sykes Enterprises, Incorporated
Reconciliation of Non-GAAP Financial Information By Segment
(in thousands)
(Unaudited)
Exhibit 6
Americas | EMEA | Other (1) | ||||||||||||||||||||||
Three Months Ended | Three Months Ended | Three Months Ended | ||||||||||||||||||||||
March 31, | March 31, | March 31, | March 31, | March 31, | March 31, | |||||||||||||||||||
2015 | 2014 | 2015 | 2014 | 2015 | 2014 | |||||||||||||||||||
GAAP income (loss) from operations |
$ | 32,541 | $ | 22,647 | $ | 3,788 | $ | 2,884 | $ | (13,788) | $ | (11,053) | ||||||||||||
Adjustments: |
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Acquisition-related severance & consulting engagement costs |
- | - | - | - | - | - | ||||||||||||||||||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
3,745 | 4,102 | - | - | - | - | ||||||||||||||||||
Merger & integration costs |
- | - | - | - | - | - | ||||||||||||||||||
EMEA restructuring |
- | - | - | - | - | - | ||||||||||||||||||
Other |
- | - | - | - | - | - | ||||||||||||||||||
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Non-GAAP income (loss) from operations |
$ | 36,286 | $ | 26,749 | $ | 3,788 | $ | 2,884 | $ | (13,788) | $ | (11,053) | ||||||||||||
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Americas | EMEA | Other (1) | ||||||||||||||||||||||
Three Months Ended | Three Months Ended | Three Months Ended | ||||||||||||||||||||||
March 31, | December 31, | March 31, | December 31, | March 31, | December 31, | |||||||||||||||||||
2015 | 2014 | 2015 | 2014 | 2015 | 2014 | |||||||||||||||||||
GAAP income (loss) from operations |
$ | 32,541 | $ | 41,473 | $ | 3,788 | $ | 4,799 | $ | (13,788) | $ | (13,714) | ||||||||||||
Adjustments: |
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Acquisition-related severance & consulting engagement costs |
- | - | - | - | - | - | ||||||||||||||||||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
3,745 | 3,818 | - | - | - | - | ||||||||||||||||||
Merger & integration costs |
- | - | - | - | - | - | ||||||||||||||||||
EMEA restructuring |
- | - | - | - | - | - | ||||||||||||||||||
Other |
- | (2,620) | - | - | - | - | ||||||||||||||||||
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Non-GAAP income (loss) from operations |
$ | 36,286 | $ | 42,671 | $ | 3,788 | $ | 4,799 | $ | (13,788) | $ | (13,714) | ||||||||||||
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(1) | Other includes corporate and other costs. |
12
Sykes Enterprises, Incorporated
Reconciliation of Non-GAAP Financial Information
(Unaudited)
Exhibit 7
Business Outlook | ||||
Second Quarter | ||||
2015 | ||||
GAAP net income, per diluted share |
$0.18 - $0.21 | |||
Adjustments: |
||||
Acquisition-related severance & consulting engagement costs |
- | |||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
0.06 | |||
Merger & integration costs |
- | |||
EMEA restructuring |
- | |||
Other |
- | |||
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Non-GAAP net income, per diluted share |
$0.24 - $0.27 | |||
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Business Outlook | ||||
Full Year | ||||
2015 | ||||
GAAP net income, per diluted share |
$1.32 - $1.40 | |||
Adjustments: |
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Acquisition-related severance & consulting engagement costs |
- | |||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
0.22 | |||
Merger & integration costs |
- | |||
EMEA restructuring |
- | |||
Other |
- | |||
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Non-GAAP net income, per diluted share |
$1.54 - $1.62 | |||
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13
Sykes Enterprises, Incorporated
Reconciliation of Non-GAAP Financial Information
(Unaudited)
Exhibit 8
Three Months Ended | ||||||
March 31, | March 31, | December 31, | ||||
2015 | 2014 | 2014 | ||||
GAAP tax rate |
27% | 31% | 28% | |||
Adjustments: |
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Acquisition-related severance & consulting engagement costs |
- | - | - | |||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
1% | - | -1% | |||
Merger & integration costs |
- | - | - | |||
EMEA restructuring |
- | - | - | |||
Other |
- | - | 1% | |||
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Non-GAAP tax rate |
28% | 31% | 28% | |||
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Three Months Ended |
Year Ended | |||
June 30, | December 31, | |||
2015 | 2015 | |||
GAAP tax rate |
27% | 26% | ||
Adjustments: |
||||
Acquisition-related severance & consulting engagement costs |
- | - | ||
Acquisition-related depreciation & amortization of property & equipment and intangible write-ups |
3% | 1% | ||
Merger & integration costs |
- | - | ||
EMEA restructuring |
- | - | ||
Other |
- | - | ||
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Non-GAAP tax rate |
30% | 27% | ||
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14
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