Delivers record revenue and earnings; Affirms 2016 outlook of 5-8% revenue growth and 20-30% adjusted EBITDA expansion
WALTHAM, Mass. – February 11, 2016 – Lionbridge Technologies, Inc. (Nasdaq: LIOX), today announced financial results for the fourth quarter and year ended December 31, 2015.
Financial highlights for FY 2015 include:
Business highlights for FY 2015 include:
“In 2015, we delivered our strongest financial performance in history with record revenue, ongoing margin expansion, and record earnings despite currency and customer concentration headwinds,” said Rory Cowan, CEO, Lionbridge. “As we enter 2016, we have positive momentum across our business. Revenue from our largest client has remained stable for the past several quarters. Our CLS integration and restructuring process is largely complete. Demand for our marketing and translation services continues to grow. I am proud of our end market growth and continued customer diversification, a strategy we committed to three years ago. These achievements provide a strong foundation for ongoing revenue and earnings growth in 2016.”
Highlights for the fourth quarter ended December 31, 2015 include:
The Company provided an outlook for the first quarter of 2016 with revenue of $137-141 million, reflecting traditional Q1 seasonality. The Company also affirmed its expectations for FY 2016 revenue growth of approximately 5-8% and adjusted EBITDA growth of approximately 20-30% year on year, depending on fluctuations in exchange rates as well as the timing of the benefits related to recent cost actions.
Lionbridge management will conduct a conference call at 9:00 a.m. ET this morning to discuss financial performance for the quarter and other matters, including matters related to its future performance. To participate, callers within the United States can dial 800-988-9535 and international callers can dial 312-470-7395. The pass code for the call is “Lionbridge”. The conference call will also be available on the financial events page of the investor relations section of the Lionbridge website at www.lionbridge.com.
In this release, the Company’s adjusted earnings, adjusted earnings per share and adjusted EBITDA are not presented in accordance with generally accepted accounting principles (GAAP) and are not intended to be used in lieu of GAAP presentations of results of operations. These measures are presented because management believes they provide additional information to investors with respect to the performance of our fundamental business activities. “Adjusted earnings” and “Adjusted EBITDA” as well as “Adjusted Earnings per Share (EPS)” are non-GAAP financial measures and should not be viewed as alternatives to GAAP measures of performance. Management believes the most directly comparable GAAP financial measure for these measures are net income and diluted net income per share, respectively, and has provided a reconciliation of GAAP net income to adjusted earnings, adjusted earnings per share and adjusted EBITDA at the end of this release.
The Company includes the impact of changes in foreign currency in its reporting of GAAP revenue. In addition, the Company provides revenue growth and growth rates in constant currency to exclude the impact of foreign currency translation, in order to facilitate an evaluation of our current revenue performance and a comparison to our past revenue performance. To calculate historical revenue and revenue growth rates in constant currency, we convert actual net sales from local currency to U.S. dollars using constant foreign currency exchange rates in the current and prior period. Revenue growth rates that exclude the impact of sales from changes in foreign currency exchange rates are not in accordance with U.S. GAAP and should not be considered in isolation from or as a replacement for GAAP reporting.
Lionbridge enables more than 800 world-leading brands to increase international market share, speed adoption of products, and effectively engage their customers in local markets worldwide. Using our innovative cloud technology platforms and our global crowd of more than 100,000 professional cloud workers, we provide translation, online marketing, global content management, and application testing solutions that ensure global brand consistency, local relevancy, and technical usability across all touch points of the customer lifecycle. Based in Waltham, Mass., Lionbridge maintains solution centres in 28 countries. To learn more, visit http://www.lionbridge.com.
This press release contains forward-looking statements that involve risks and uncertainties, including expected financial performance, expected revenue and profit growth, and the momentum, pace, and strengthening of such growth in CLS 2015, FY 2015, and FY 2016 as well as expected revenue from Lionbridge’s largest customer and synergies from Lionbridge’s acquisition of SEC Communication (“SEC”). These forward-looking statements reflect management’s current views and Lionbridge does not undertake to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date hereof except as required by law. Lionbridge’s actual experiences, actions, financial, and operating results may differ materially from those discussed in the forward-looking statements. Factors that might cause such a difference include Lionbridge’s ability to fully integrate CLS and the pace of such integration actions; the timing of the realisation of any synergies associated with the acquisition of CLS; the impact of foreign currency fluctuations on revenue, margins, costs, operating results, and profitability, and the Company’s ability to successfully manage this exposure through hedge instruments and other strategies; its ability to provide and maintain high quality services at a competitive price and related customer satisfaction with such service delivery; the loss of or reduction in demand from one or more major client or customer, which would materially affect Lionbridge’s business; Lionbridge’s ability to expand its relationships with existing clients; Lionbridge’s ability to broaden its client base; the Company’s dependence on clients’ product releases, production schedules, and procurement strategies to generate revenues; the anticipated benefits of expansion of global language workflow technologies; the impact of competing language technology on the Company’s existing customer relationships and ability to secure new customers; the ability of Lionbridge to realise the expected benefits of its technology initiatives and acquisitions and the timing of the realisation of such benefits; errors, interruptions, or delays in cloud-based technology; breaches of security measures; the termination of customer contracts or engagements prior to the end of their term; the size, timing, and recognition of revenue from clients; the ability of Lionbridge to integrate acquisitions and expand its customer relationships and the timing and success of such activities; the portion of the Company’s service engagements that are subject to the impact of foreign currency fluctuations; continued uncertainty and volatility in global economic conditions that could negatively affect demand for the Company’s services and technologies; reduced demand for the Company’s services that adversely impacts Lionbridge’s future revenues, cash flows, results of operations, and financial condition; Lionbridge’s ability to perform services in lower cost operational locations and the timing of its transfer of service execution to such locations, and customer acceptance of service execution in such locations; risks associated with conducting business outside of the United States, including compliance with changing and potentially conflicting laws and regulations and expenses and delays associated with any such activities; longer collection cycles in particular jurisdictions; risks associated with competition; Lionbridge’s ability to forecast revenue, profitability, technology adoption, customer demand, and operating results; changes in tax rates applicable to the Company and changes to the interpretations of applicable tax rates; changes in interpretation of statutory and regulatory positions by international tax authorities in countries in which Lionbridge conducts business; changes in interpretation of employment and tax positions by U.S. state and federal authorities; the failure of Lionbridge to keep pace with technological changes or changing customer needs; the risk of claims by third parties of intellectual property claims; the ability of Lionbridge to respond to fluctuations in the complexity, timing, and mix of services required by customers; and Lionbridge being held liable for defects or errors in its service offerings. For a more detailed description of the risk factors associated with Lionbridge, please refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 and subsequent filings with the SEC (copies of which may be accessed through the SEC’s website at http://www.sec.gov).