StarTek, Inc. (NYSE:SRT) Q3 2019 Earnings Conference Call - Final Transcript

Nov 06, 2019 • 05:00 pm ET

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StarTek, Inc. (NYSE:SRT) Q3 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good afternoon, everyone, and thank you for participating in today's conference call to discuss StarTek's financial results for the quarter ended September 30, 2019.

Joining us today are StarTek's President and Global CEO, Lance Rosenzweig, and the company's CFO, Ramesh Kamath. Following their remarks, we'll open the call for your questions.

Before we continue, we would like to remind all participants that the discussion today may contain certain statements, which are forward-looking in nature pursuant to the Safe Harbor provisions of the federal securities laws. These statements are based on information currently available to us and are subject to various risks and uncertainties that could cause actual results to differ materially. StarTek advises all those listening to this call to review the latest 10-Q and 10-K posted on its website for a summary of these risks and uncertainties. StarTek does not undertake the responsibility to update any forward-looking statements. Further the discussion today may include some non-GAAP measures. In accordance with Regulation G, the company has reconciled these amounts back to the closest GAAP-based measurement. The reconciliations can be found in the earnings release on the Investor Relations section of their website.

I would like to remind everyone that a webcast replay of today's call will be available in Investors section of the company's website at www.startek.com.

Now I'd like to turn the call over to StarTek's President and Global CEO, Lance Rosenzweig. Sir, please proceed.

Executive
Lance Rosenzweig

Thank you, Daniel. Good afternoon, everyone, and thank you all for joining. Our third quarter was one of the strongest in the history of StarTek with record high revenue, gross margin and adjusted EBITDA since last year's business combination with Aegis. The work we have put in place over the last year to integrate with Aegis drive synergies, create a powerful client-centric operating model and execute on our sales pipeline, are all translating into material improvements in our business.

We are very pleased that our operating results are now proving out the thesis in combining StarTek and Aegis to create such a strong platform and global customer experience management.

These solid results have been further supported by our client diversification strategy. In Q3, our non-telco verticals accounted for 63% of revenue, up from 59% last quarter and 51% in calendar 2018. As we have stated in the past, we are highly focused on targeting new clients that accelerate our growth, both by cross-selling services and geographies and also organically driven by our clients' own growth.

Most of these new client wins have come from exciting high-growth verticals like technology, next-gen retail, healthcare, financial services and even travel and education. However, that does not preclude us from winning new business in established verticals like telco or media and cable as long as we find the right opportunities with strong growth prospects and attractive margins. And during the third quarter we found just that in a growing UK based wireless telco leader where StarTek is now providing a broad suite of customer experience management solutions for this