StarTek, Inc. (NYSE:SRT) Q4 2018 Earnings Conference Call - Final Transcript

Mar 13, 2019 • 05:00 pm ET

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StarTek, Inc. (NYSE:SRT) Q4 2018 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you.

(Operator Instructions)

Our first question comes from Dave Konig of Baird. Your line is now open.

Analyst
Dave Konig

Yeah. Hey, guys. Thank you and congrats on the retail clients, it sounds like good momentum there.

Executive
Lance Rosenzweig

Thank you, David.

Analyst
Dave Konig

Yeah. And I guess my first question, so the $158 million kind of base. At the first quarter, we have a kind of clean combined company base. Is that a good place to kind of as a starting point think of next year just using that $158 million as kind of your baseline quarterly result? And from there, maybe -- how is this seasonality going to work, like is Q1 a little lower than that and the rest of the quarters are a little above and maybe average the $158 million for the year? How should we think of that?

Executive
Lance Rosenzweig

Yeah. So, we're not, as we've mentioned in the past, providing forward-looking guidance. But I would say that this is our first full and clean quarter. There is a bit of seasonality in it as is typical in our industry with companies who have some seasonal clients. And so, you're likely to see that seasonal trend will continue to the extent that we have this kind of retail business going forward.

Analyst
Dave Konig

Okay. Thank you. And I guess secondly, you called out that the loss should be less going forward just simply because you had the restructuring type stuff in Q4. Are the other line items more normalized? There was nothing kind of one-off in some of the other line items out there like the gross margin and the SG&A?

Executive
Ramesh Kamath

Hi, David. This is Ramesh here. No, there were no other one-off items anywhere else and it's all par for the course.

Analyst
Dave Konig

Okay. Got you. And then, a couple of just little housekeeping ones. I know Argentina, the peso has been weak. Is there any way to think about how that impacted Q4 and maybe even how that impacts 2019?

Executive
Ramesh Kamath

Well, everybody asks me about the Argentina peso, and the good news is it has remained completely stable all over the last quarter for us. The previous quarter to that, it had depreciated about 50% in just one quarter, but quarter four, it's remained completely stable, and as on today also, for most of the first quarter, it remained stable. So we are remaining reasonably hopeful that the worst is behind them. And like I said, there are elections in May. We'll know after that.

Analyst
Dave Konig

Got you. One last quick one. Free cash flow for '19, I would imagine your CapEx spending is going to probably be semi-low relative to D&A. Do you expect to have a free cash flow positive year in '19?

Executive
Ramesh Kamath

As Lance keeps telling me all the time, we do not provide forward-looking guidance. So, you'll have to excuse us. But we have mentioned in our prepared speech that we are looking at investing in our technology and infrastructure assets.

Analyst
Dave Konig

Okay. Great, thank you.

Executive
Lance Rosenzweig

Thanks, David.

Operator
Operator

Thank you. And our