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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): October 12, 2023
IDT
CORPORATION
(Exact
name of registrant as specified in its charter)
Delaware |
|
1-16371 |
|
22-3415036 |
(State
or other jurisdiction of incorporation) |
|
(Commission
File Number) |
|
(IRS
Employer Identification No.) |
520
Broad Street Newark, New Jersey |
|
07102 |
(Address
of principal executive offices) |
|
(Zip
Code) |
Registrant’s
telephone number, including area code: (973) 438-1000
Not
Applicable
(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 (see General Instruction A.2. below):
☐ |
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)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of Each Class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
Class
B common stock, par value $0.01 per share |
|
IDT |
|
New
York Stock Exchange. |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405)
or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging
growth company ☐
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item
2.02. Results of Operations and Financial Condition
On
October 12, 2023, IDT Corporation (the “Registrant”) issued a press release announcing its results of operations for its
fiscal quarter and fiscal year ended July 31, 2023. A copy of the earnings release concerning the foregoing results is furnished herewith
as Exhibit 99.1 and is incorporated herein by reference.
The
Registrant is furnishing the information contained in this Report, including Exhibit 99.1, pursuant to Item 2.02 of Form 8-K promulgated
by the Securities and Exchange Commission (the “SEC”). This information shall not be deemed to be “filed” with
the SEC or incorporated by reference into any other filing with the SEC unless otherwise expressly stated in such filing. In addition,
this Report and the press release contain statements intended as “forward-looking statements” that are subject to the cautionary
statements about forward-looking statements set forth in the press release.
Item
9.01. Financial Statements and Exhibits.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
|
IDT CORPORATION |
|
|
|
|
By: |
/s/
Shmuel Jonas |
|
Name: |
Shmuel Jonas |
|
Title: |
Chief Executive Officer |
Dated:
October 12, 2023
EXHIBIT
INDEX
Exhibit
99.1
IDT
Corporation Reports Fourth Quarter and Fiscal Year 2023 Results
NRS
added a record number of net retail terminals and payment processing accounts during 4Q23
net2phone
increased seats served by 21% and subscription revenue by 19% YoY in 4Q23
BOSS
Money increased transactions by 42% driving a 36% YoY revenue increase in 4Q23
NEWARK,
NJ — October 12, 2023: IDT Corporation (NYSE: IDT), a global provider of fintech, cloud communications, and traditional communications
services, today reported results for the fourth quarter and full fiscal year 2023, the three and twelve months ended July 31, 2023.
HIGHLIGHTS
(Throughout
this release, unless otherwise noted, results for the fourth quarter of fiscal year 2023 (4Q23) are compared to the fourth quarter of
fiscal year 2022 (4Q22) and results for FY2023 are compared to FY2022. All earnings per share (EPS) and other ‘per share’
results are per diluted share.)
| ● | National
Retail Solutions (NRS) added over 1,700 net active point-of-sale (POS) terminals during 4Q23
and over 6,300 during FY2023 to reach approximately 25,700 as of July 31st. Recurring
revenue* increased 6% in 4Q23 to $18.8 million led by a 79% increase in merchant
services revenue. FY2023 recurring revenue increased 58% to $71.4 million; |
| ● | net2phone
added approximately 12,000 net seats served during 4Q23 and 61,000 during FY2023 to reach
approximately 352,000 as of July 31st. Subscription revenue* increased
19% in 4Q23 to $17.9 million. FY2023 subscription revenue increased 25% to $66.8 million; |
| ● | BOSS
Money remittance volume increased by 42% to 3.79 million transactions during 4Q23 while revenue
increased 36% to $22.3 million led by a 46% increase in retail channel revenue. FY2023 BOSS
Money revenue increased 38% to $76.9 million; |
| ● | Consolidated
revenue decreased 8% in 4Q23 to $304 million while consolidated direct cost of revenue decreased
11% to $211 million. FY2023 consolidated revenue decreased 9% to $1,239 million while the
consolidated direct cost of revenue decreased 15% to $876 million; |
| ● | Consolidated
income from operations decreased 38% in 4Q23 to $12.0 million. FY2023 consolidated income
from operations increased 1% to $60.7 million; |
| ● | Net
income attributable to IDT decreased 54% in 4Q23 to $8.0 million. FY2023 net income attributable
to IDT increased 50% to $40.5 million; |
| ● | Consolidated
Adjusted EBITDA** decreased 25% in 4Q23 to $18.1 million. FY2023 consolidated
Adjusted EBITDA increased 9% to $86.2 million; |
| ● | EPS
decreased to $0.31 in 4Q23 from $0.66 and Non-GAAP EPS** decreased to $0.36 from
$0.67. FY2023 EPS increased to $1.58 from $1.03, and Non-GAAP EPS increased to $1.86 from
$1.12; |
| ● | During
4Q23, IDT accelerated its stock repurchases, buying back 231,416 shares of its Class B common
stock in market transactions for $5.6 million. During FY2023, IDT repurchased 511,546 Class
B shares for $13.1 million. During 1Q24 through October 11th, IDT had repurchased
124,530 shares of Class B common stock for an aggregate purchase price of $2.8 million. |
*See
‘Explanation of Key Performance Metrics’ at the end of this release.
**Adjusted
EBITDA and Non-GAAP EPS are Non-GAAP financial measures intended to provide useful information that supplements IDT’s or the relevant
segment’s results in accordance with GAAP. Please refer to the Reconciliation of Non-GAAP Financial Measures later in this release
for an explanation of these terms and their respective reconciliations to the most directly comparable GAAP measures.
REMARKS
BY SHMUEL JONAS, CEO
“Our
results this quarter were highlighted by the continued expansion of our three high-growth, high-margin businesses, while our Traditional
Communications segment performed as expected.
“At
NRS, we have ramped up our investment to accelerate the growth of the NRS terminal and payment networks, and we delivered record quarterly
increases in both net new terminals and net new NRS Pay accounts. With that tailwind, Merchant Services Q4 revenue increased 79% year-over-year.
Advertising & Data revenue, while 40% below the year-ago peak, improved sequentially. Advertising & Data revenue increased 7%
from the prior quarter and is on track for a larger sequential increase in the current quarter. NRS’ results also reflected our
investment in growth initiatives, including the development of new features and functionalities that will help us expand our target market
to new verticals within the independent retailer market during the coming year.
“At
net2phone, subscription revenue increased 19% year over year, powered by the increase in seats served and an increase in average subscription
revenue per seat in Latin America. Here too we are investing in initiatives to expand the business. In the coming quarters, we are preparing
to roll out two exciting premium services – net2phone AI and Call Center Essentials – that we expect to enhance ARPU and
margins across our markets.
“Within
our Fintech segment, BOSS Money, our international remittance business, continued to benefit from the synergies between its retail and
direct-to-consumer channels, and from our cross-marketing programs within the larger BOSS ecosystem. Also in our Fintech segment, we’ve
begun enrolling customers in our new mobile banking app, Elroy. Elroy is replete with innovative features to help underbanked
and unbanked customers integrate into the U.S. financial mainstream while appealing to anyone who despises bank fees but appreciates
financial convenience, saving money, and earning interest.
“Within
our Traditional Communications segment, we are working to further streamline the operations of our BOSS Revolution Calling and IDT Global
businesses while pushing new initiatives to return our IDT Digital Payments business to growth.”
RESULTS
BY SEGMENT
Fiscal
Quarters | |
NRS | | |
net2phone | | |
Fintech | | |
Traditional
Communications | |
(In
millions) | |
4Q23 | | |
3Q23 | | |
4Q22 | | |
4Q23 | | |
3Q23 | | |
4Q22 | | |
4Q23 | | |
3Q23 | | |
4Q22 | | |
4Q23 | | |
3Q23 | | |
4Q22 | |
Revenue | |
$ | 19.9 | | |
$ | 18.1 | | |
$ | 19.2 | | |
$ | 19.3 | | |
$ | 18.4 | | |
$ | 16.2 | | |
$ | 24.6 | | |
$ | 21.8 | | |
$ | 18.5 | | |
$ | 240.0 | | |
$ | 241.0 | | |
$ | 274.6 | |
Direct
cost of revenue | |
$ | 2.1 | | |
$ | 2.6 | | |
$ | 2.7 | | |
$ | 3.1 | | |
$ | 3.0 | | |
$ | 2.5 | | |
$ | 11.0 | | |
$ | 9.2 | | |
$ | 7.4 | | |
$ | 195.2 | | |
$ | 195.4 | | |
$ | 225.3 | |
SG&A
expense | |
$ | 15.4 | | |
$ | 12.8 | | |
$ | 9.5 | | |
$ | 15.2 | | |
$ | 14.4 | | |
$ | 14.0 | | |
$ | 14.8 | | |
$ | 13.2 | | |
$ | 12.5 | | |
$ | 26.3 | | |
$ | 26.0 | | |
$ | 28.9 | |
Income
(loss) from operations | |
$ | 1.7 | | |
$ | 2.1 | | |
$ | 6.7 | | |
$ | (0.7 | ) | |
$ | (0.4 | ) | |
$ | (1.8 | ) | |
$ | (1.9 | ) | |
$ | (1.3 | ) | |
$ | (1.9 | ) | |
$ | 14.1 | | |
$ | 12.9 | | |
$ | 18.0 | |
Adjusted
EBITDA | |
$ | 2.4 | | |
$ | 2.7 | | |
$ | 7.1 | | |
$ | 0.9 | | |
$ | 1.0 | | |
$ | (0.4 | ) | |
$ | (1.2 | ) | |
$ | (0.6 | ) | |
$ | (1.3 | ) | |
$ | 18.6 | | |
$ | 19.7 | | |
$ | 20.5 | |
Fiscal
Years | |
NRS | | |
net2phone | | |
Fintech | | |
Traditional
Communications | |
(In
millions) | |
FY2023 | | |
FY2022 | | |
FY2023 | | |
FY2022 | | |
FY2023 | | |
FY2022 | | |
FY2023 | | |
FY2022 | |
Revenue | |
$ | 77.1 | | |
$ | 51.3 | | |
$ | 72.4 | | |
$ | 58.2 | | |
$ | 86.6 | | |
$ | 64.6 | | |
$ | 1,002.7 | | |
$ | 1,190.0 | |
Direct
cost of revenue | |
$ | 8.9 | | |
$ | 7.1 | | |
$ | 12.0 | | |
$ | 10.1 | | |
$ | 36.5 | | |
$ | 26.1 | | |
$ | 818.3 | | |
$ | 991.2 | |
SG&A
expense | |
$ | 51.4 | | |
$ | 32.1 | | |
$ | 57.3 | | |
$ | 54.2 | | |
$ | 51.9 | | |
$ | 43.1 | | |
$ | 107.0 | | |
$ | 113.3 | |
Income
(loss) from operations | |
$ | 14.4 | | |
$ | 11.2 | | |
$ | (2.8 | ) | |
$ | (11.1 | ) | |
$ | (2.5 | ) | |
$ | (6.9 | ) | |
$ | 61.3 | | |
$ | 75.8 | |
Adjusted
EBITDA | |
$ | 16.8 | | |
$ | 12.1 | | |
$ | 3.0 | | |
$ | (6.1 | ) | |
$ | (1.8 | ) | |
$ | (4.6 | ) | |
$ | 77.5 | | |
$ | 85.5 | |
National
Retail Solutions (NRS)
During
4Q23 and 4Q22, the NRS segment contributed 6.6% and 5.9% of IDT’s consolidated revenue, respectively. For FY2023 and FY2022, the
corresponding contributions were 6.2% and 3.8%, respectively.
Take-Aways:
● | During
4Q23, NRS added 1,744 net active terminals – a quarterly record. During FY2023, the
network expanded by 6,308 net new terminals. |
● | During
4Q23, NRS added 1,661 net payment processing accounts, also a record quarterly increase.
During FY2023, NRS added 5,459 net payment processing accounts. |
● | Merchant
Services revenue growth was driven primarily by the increase in net payment processing accounts. |
National
Retail Solutions (NRS) (Terminals
and accounts at end of period. $ in millions, except for revenue per terminal) |
| |
4Q23 | | |
3Q23 | | |
4Q22 | | |
4Q23-4Q22
(% Δ) | | |
FY2023 | | |
FY2022 | | |
FY2023-FY2022 (%
Δ) | |
Terminals
and payment processing accounts | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Active
POS terminals | |
| 25,700 | | |
| 23,900 | | |
| 19,400 | | |
| +33 | % | |
| | | |
| | | |
| | |
Payment
processing accounts | |
| 15,800 | | |
| 14,100 | | |
| 10,300 | | |
| +53 | % | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Recurring
revenue | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Merchant
Services and other | |
$ | 10.3 | | |
$ | 8.7 | | |
$ | 5.8 | | |
| +79 | % | |
$ | 32.8 | | |
$ | 17.5 | | |
| +88 | % |
Advertising
and Data | |
$ | 6.2 | | |
$ | 5.8 | | |
$ | 10.3 | | |
| (40 | )% | |
$ | 30.6 | | |
$ | 22.3 | | |
| +37 | % |
SaaS
Fees | |
$ | 2.3 | | |
$ | 2.1 | | |
$ | 1.6 | | |
| +44 | % | |
$ | 8.0 | | |
$ | 5.6 | | |
| +45 | % |
Total
recurring revenue | |
$ | 18.8 | | |
$ | 16.5 | | |
$ | 17.7 | | |
| +6 | % | |
$ | 71.4 | | |
$ | 45.3 | | |
| +58 | % |
POS
Terminal Sales | |
$ | 1.1 | | |
$ | 1.6 | | |
$ | 1.6 | | |
| (29 | )% | |
$ | 5.7 | | |
$ | 6.0 | | |
| (6 | )% |
Total
revenue | |
$ | 19.9 | | |
$ | 18.1 | | |
$ | 19.2 | | |
| +4 | % | |
$ | 77.1 | | |
$ | 51.3 | | |
| +50 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Monthly
average recurring revenue per terminal* | |
$ | 253 | | |
$ | 237 | | |
$ | 316 | | |
| (20 | )% | |
$ | 264 | | |
$ | 226 | | |
| +17 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
from operations | |
$ | 1.7 | | |
$ | 2.1 | | |
$ | 6.7 | | |
| (75 | )% | |
$ | 14.4 | | |
$ | 11.2 | | |
| +29 | % |
Adjusted
EBITDA | |
$ | 2.4 | | |
$ | 2.7 | | |
$ | 7.1 | | |
| (66 | )% | |
$ | 16.8 | | |
$ | 12.1 | | |
| +38 | % |
net2phone
During
4Q23 and 4Q22, the net2phone segment contributed 6.3% and 4.9% of IDT’s consolidated revenue, respectively. For FY2023 and FY2022,
the corresponding contributions were 5.8% and 4.3%, respectively.
net2phone
(Seats
in thousands at end of period. $ in millions) |
| |
4Q23 | | |
3Q23 | | |
4Q22 | | |
4Q23-4Q22
(% Δ, $) | | |
FY2023 | | |
FY2022 | | |
FY2023-FY2022 (%
Δ, $) | |
Seats | |
| 352 | | |
| 340 | | |
| 291 | | |
| +21 | % | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Revenue | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Subscription
revenue | |
$ | 17.9 | | |
$ | 17.1 | | |
$ | 15.1 | | |
| +19 | % | |
$ | 66.8 | | |
$ | 53.6 | | |
| +25 | % |
Other
revenue | |
$ | 1.4 | | |
$ | 1.3 | | |
$ | 1.1 | | |
| +25 | % | |
$ | 5.6 | | |
$ | 4.6 | | |
| +20 | % |
Total
Revenue | |
$ | 19.3 | | |
$ | 18.4 | | |
$ | 16.2 | | |
| +19 | % | |
$ | 72.4 | | |
$ | 58.2 | | |
| +24 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Loss
from operations | |
$ | (0.7 | ) | |
$ | (0.4 | ) | |
$ | (1.8 | ) | |
| +$1.1 | | |
$ | (2.8 | ) | |
$ | (11.1 | ) | |
| +$8.4 | |
Adjusted
EBITDA | |
$ | 0.9 | | |
$ | 1.0 | | |
$ | (0.4 | ) | |
| +$1.3 | | |
$ | 3.0 | | |
$ | (6.1 | ) | |
| +$9.1 | |
Take-Aways:
| ● | net2phone’s
year-over-year increase in seats served was powered by continued expansion in key markets
led by the U.S., Brazil, and Mexico. |
| ● | In
4Q23, subscription revenue increased 19% year-over-year driven by the robust increase in
seats served. |
| ● | In
FY2023, subscription revenue increased 25% compared to FY2022, as the increase in seats served
was augmented by a 3% increase in subscription revenue per seat including a 6% increase in
Latin American markets. |
Fintech
During
4Q23 and 4Q22, the Fintech segment contributed 8.1% and 5.6% of IDT’s consolidated revenue, respectively. For FY2023 and FY2022,
the corresponding contributions were 7.0% and 4.7%, respectively.
Fintech
(Transactions
in thousands. $ in millions except for revenue per transaction) |
| |
4Q23 | | |
3Q23 | | |
4Q22 | | |
4Q23-4Q22
(% Δ, $) | | |
FY2023 | | |
FY2022 | | |
FY2023-FY2022 (%
Δ, $) | |
BOSS
Money Transactions | |
| 3,793 | | |
| 3,274 | | |
| 2,670 | | |
| +42 | % | |
| 12,983 | | |
| 9,370 | | |
| +39 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Fintech
Revenue | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
BOSS
Money | |
$ | 22.3 | | |
$ | 19.4 | | |
$ | 16.4 | | |
| +36 | % | |
$ | 76.9 | | |
$ | 55.6 | | |
| +38 | % |
Other | |
$ | 2.3 | | |
$ | 2.4 | | |
$ | 2.1 | | |
| +6 | % | |
$ | 9.7 | | |
$ | 9.0 | | |
| +7 | % |
Total
Revenue | |
$ | 24.6 | | |
$ | 21.8 | | |
$ | 18.5 | | |
| +33 | % | |
$ | 86.6 | | |
$ | 64.6 | | |
| +34 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Average
revenue per transaction* | |
$ | 5.87 | | |
$ | 5.94 | | |
$ | 6.13 | | |
$ | (0.26 | ) | |
$ | 5.93 | | |
$ | 5.93 | | |
| NC | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Loss
from operations | |
$ | (1.9 | ) | |
$ | (1.3 | ) | |
$ | (1.9 | ) | |
| NC | | |
$ | (2.5 | ) | |
$ | (6.9 | ) | |
| +$4.4 | |
Adjusted
EBITDA | |
$ | (1.2 | ) | |
$ | (0.6 | ) | |
$ | (1.3 | ) | |
| +$0.1 | | |
$ | (1.8 | ) | |
$ | (4.6 | ) | |
| +$2.8 | |
Take-Aways:
● | In
4Q23, the 42% increase in BOSS Money transactions included a 47% increase in retail transactions
driven by expansion of the BOSS Money retail agent network and enhancements to the retailer
portal. Digital transactions increased 41%. In FY2023, transactions increased 39% including
a 41% increase in retail transactions and a 38% increase in digital transactions. |
● | BOSS
Money revenue increased 36% in 4Q23 and 38% in FY2023 driven primarily by cross-marketing
within the larger BOSS ecosystem and expansion of the retail agent network. |
Traditional
Communications
During
4Q23 and 4Q22, the Traditional Communications segment contributed 79.0% and 83.6% of IDT’s consolidated revenue, respectively.
For FY2023 and FY2022, the corresponding contributions were 81.0% and 87.2%, respectively.
Traditional
Communications ($
in millions) |
| |
4Q23 | | |
3Q23 | | |
4Q22 | | |
4Q23-4Q22
(% Δ) | | |
FY2023 | | |
FY2022 | | |
FY2023-FY2022 (%
Δ) | |
Revenue | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
IDT
Digital Payments | |
$ | 100.8 | | |
$ | 101.0 | | |
$ | 112.6 | | |
| (10 | )% | |
$ | 417.1 | | |
$ | 473.2 | | |
| (12 | )% |
BOSS
Revolution Calling | |
$ | 75.4 | | |
$ | 77.6 | | |
$ | 90.2 | | |
| (16 | )% | |
$ | 322.1 | | |
$ | 387.9 | | |
| (17 | )% |
IDT
Global | |
$ | 55.6 | | |
$ | 54.5 | | |
$ | 62.9 | | |
| (12 | )% | |
$ | 230.3 | | |
$ | 292.4 | | |
| (21 | )% |
Other | |
$ | 8.2 | | |
$ | 7.9 | | |
$ | 8.8 | | |
| (7 | )% | |
$ | 33.2 | | |
$ | 36.5 | | |
| (9 | )% |
Total
Revenue | |
$ | 240.0 | | |
$ | 241.0 | | |
$ | 274.6 | | |
| (13 | )% | |
$ | 1,002.7 | | |
$ | 1,190.0 | | |
| (16 | )% |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
from operations | |
$ | 14.1 | | |
$ | 12.9 | | |
$ | 18.0 | | |
| (22 | )% | |
$ | 61.3 | | |
$ | 75.8 | | |
| (19 | )% |
Adjusted
EBITDA | |
$ | 18.6 | | |
$ | 19.7 | | |
$ | 20.5 | | |
| (9 | )% | |
$ | 77.5 | | |
$ | 85.5 | | |
| (9 | )% |
Take-Aways:
● | As
in recent prior quarters, the year-over-year decrease in IDT Digital Payments revenue was
due to the deterioration of a key international mobile top-up corridor. |
● | Although
BOSS Revolution Calling and IDT Global’s revenues were relatively unchanged sequentially,
the industry-wide decline in the paid minute calling markets will continue to impact revenues
and cash flows for the segment in the coming quarters. |
NOTES
ON FINANCIAL STATEMENTS
Consolidated
results for all periods presented include corporate overhead. Corporate G&A expense in 4Q23 increased to $2.6 million from $1.7 million
in 4Q22 reflecting an increase in audit and accounting fees and higher employee compensation expense. For FY2023, those same factors
as well as increased non-cash stock-based compensation expense drove an increase in corporate G&A to $9.3 million from $7.8 million
in FY2022.
As
of July 31, 2023, IDT held $152.2 million in cash, cash equivalents, debt securities, and current equity investments. Current assets
totaled $387.1 million and current liabilities totaled $294.1 million. IDT had no outstanding debt at the fiscal year-end.
Net
cash provided by operating activities during 4Q23 was $25.4 million compared to $16.1 million during 4Q22. Exclusive of changes in customer
deposit balances at IDT’s Gibraltar-based bank, net cash provided by operating activities during 4Q23 was $27.1 million compared
to $22.2 million during 4Q22. The increase in net cash provided by operating activities was primarily due to the timing of operating
cash receipts and payments.
Net
cash provided by operating activities during FY2023 was $54.1 million compared to $29.4 million in FY2022. Exclusive of changes in customer
deposit balances at IDT’s Gibraltar-based bank, net cash provided by operating activities during FY2023 was $58.3 million compared
to $45.4 million during FY 2022.
Capital
expenditures decreased to $5.9 million in 4Q23 from $8.1 million in 4Q22 and increased to $22.0 million in FY2023 from $21.9 million
in FY2022.
IDT
EARNINGS ANNOUNCEMENT AND SUPPLEMENTAL INFORMATION
This
release is available for download in the “Investors & Media” section of the IDT Corporation website (https://www.idt.net/investors-and-media)
and has been filed on a current report (Form 8-K) with the SEC.
IDT
will host an earnings conference call beginning at 5:30 PM Eastern today with management’s discussion of results followed by Q&A
with investors. To listen to the call and participate in the Q&A, dial 1-888-506-0062 (toll-free from the US) or 1-973-528-0011 (international)
and request the IDT Corporation call (participant access code: 300767).
A
replay of the conference call will be available approximately three hours after the call concludes through October 24, 2023. To access
the call replay, dial 1-877-481-4010 (toll-free from the US) or 1-919-882-2331 (international) and provide this replay passcode: 49120.
The replay will also be accessible via streaming audio at the IDT investor relations website.
ABOUT
IDT CORPORATION
IDT
Corporation (NYSE: IDT) is a global provider of fintech and communications services through a portfolio of synergistic businesses: National
Retail Solutions (NRS), through its point-of-sale (POS) platform, enables independent retailers to operate more effectively
while providing advertisers and marketers with unprecedented reach into underserved consumer markets; net2phone provides
enterprises and organizations with intelligently integrated cloud communications and contact center services across channels and devices;
Our fintech and neo-banking services include BOSS Money, our popular international remittance business, as well as other
services that make saving, spending, and sharing money easy and secure; IDT Digital Payments and BOSS Revolution
Calling make sharing prepaid products and services and speaking with friends and family around the world convenient and reliable;
and, IDT Global and IDT Express enable communications services to provision and manage international
voice and SMS messaging.
All
statements above that are not purely about historical facts, including, but not limited to, those in which we use the words “believe,”
“anticipate,” “expect,” “plan,” “intend,” “estimate,” “target”
and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While
these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially
from the results expressed or implied by these statements due to numerous important factors. Our filings with the SEC provide detailed
information on such statements and risks and should be consulted along with this release. To the extent permitted under applicable law,
IDT assumes no obligation to update any forward-looking statements.
CONTACT
IDT
Corporation Investor Relations
Bill
Ulrey
william.ulrey@idt.net
973-438-3838
IDT
CORPORATION
CONSOLIDATED BALANCE SHEETS
July
31 (in thousands, except per share data) | |
2023
Unaudited | | |
2022 | |
ASSETS | |
| | | |
| | |
CURRENT
ASSETS: | |
| | | |
| | |
Cash
and cash equivalents | |
$ | 103,637 | | |
$ | 98,352 | |
Restricted
cash and cash equivalents | |
| 95,186 | | |
| 91,210 | |
Debt
securities | |
| 42,414 | | |
| 22,303 | |
Equity
investments | |
| 6,198 | | |
| 17,091 | |
Trade
accounts receivable, net of allowance for doubtful accounts of $5,642 and $5,328 at July 31, 2023 and 2022, respectively | |
| 32,092 | | |
| 39,525 | |
Settlement
assets, net of reserve of $1,143 and $554 at July 31, 2023 and 2022, respectively | |
| 32,396 | | |
| 31,938 | |
Disbursement
prefunding | |
| 30,113 | | |
| 21,057 | |
Prepaid
expenses | |
| 16,638 | | |
| 17,526 | |
Other
current assets | |
| 28,394 | | |
| 23,625 | |
TOTAL
CURRENT ASSETS | |
| 387,068 | | |
| 362,627 | |
Property,
plant, and equipment, net | |
| 38,655 | | |
| 36,866 | |
Goodwill | |
| 26,457 | | |
| 26,380 | |
Other
intangibles, net | |
| 8,196 | | |
| 9,609 | |
Equity
investments | |
| 9,874 | | |
| 7,426 | |
Operating
lease right-of-use assets | |
| 5,540 | | |
| 7,210 | |
Deferred
income tax assets, net | |
| 24,101 | | |
| 36,701 | |
Other
assets | |
| 10,919 | | |
| 10,275 | |
TOTAL
ASSETS | |
$ | 510,810 | | |
$ | 497,094 | |
LIABILITIES,
REDEEMABLE NONCONTROLLING INTEREST, AND EQUITY | |
| | | |
| | |
CURRENT
LIABILITIES: | |
| | | |
| | |
Trade
accounts payable | |
$ | 22,231 | | |
$ | 28,543 | |
Accrued
expenses | |
| 110,796 | | |
| 117,109 | |
Deferred
revenue | |
| 35,343 | | |
| 36,531 | |
Customer
deposits | |
| 86,481 | | |
| 85,764 | |
Settlement
liabilities | |
| 21,495 | | |
| 17,659 | |
Other
current liabilities | |
| 17,761 | | |
| 19,466 | |
TOTAL
CURRENT LIABILITIES | |
| 294,107 | | |
| 305,072 | |
Operating
lease liabilities | |
| 2,881 | | |
| 4,606 | |
Other
liabilities | |
| 3,354 | | |
| 6,588 | |
TOTAL
LIABILITIES | |
| 300,342 | | |
| 316,266 | |
Commitments
and contingencies | |
| | | |
| | |
Redeemable
noncontrolling interest | |
| 10,472 | | |
| 10,191 | |
EQUITY: | |
| | | |
| | |
IDT
Corporation stockholders’ equity: | |
| | | |
| | |
Preferred
stock, $.01 par value; authorized shares—10,000; no shares issued | |
| — | | |
| — | |
Class
A common stock, $.01 par value; authorized shares—35,000; 3,272 shares issued and 1,574 shares outstanding at July 31, 2023
and 2022 | |
| 33 | | |
| 33 | |
Class
B common stock, $.01 par value; authorized shares—200,000; 27,851 and 27,725 shares issued and 23,699 and 24,112 shares outstanding
at July 31, 2023 and 2022, respectively | |
| 279 | | |
| 277 | |
Additional
paid-in capital | |
| 301,408 | | |
| 296,005 | |
Treasury
stock, at cost, consisting of 1,698 and 1,698 shares of Class A common stock and 4,152 and 3,613 shares of Class B common stock at
July 31, 2023 and 2022, respectively | |
| (115,461 | ) | |
| (101,565 | ) |
Accumulated
other comprehensive loss | |
| (17,192 | ) | |
| (11,305 | ) |
Retained
earnings (accumulated deficit) | |
| 24,662 | | |
| (15,830 | ) |
Total
IDT Corporation stockholders’ equity | |
| 193,729 | | |
| 167,615 | |
Noncontrolling
interests | |
| 6,267 | | |
| 3,022 | |
TOTAL
EQUITY | |
| 199,996 | | |
| 170,637 | |
TOTAL
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST, AND EQUITY | |
$ | 510,810 | | |
$ | 497,094 | |
IDT
CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
Year
ended July 31 (in thousands, except per share data) | |
2023
Unaudited | | |
2022 | | |
2021 | |
REVENUES | |
$ | 1,238,854 | | |
$ | 1,364,057 | | |
$ | 1,446,990 | |
COSTS
AND EXPENSES: | |
| | | |
| | | |
| | |
Direct
cost of revenues (exclusive of depreciation and amortization) | |
| 875,734 | | |
| 1,034,430 | | |
| 1,154,048 | |
Selling,
general and administrative (i) | |
| 276,891 | | |
| 250,481 | | |
| 218,467 | |
Depreciation
and amortization | |
| 20,136 | | |
| 18,115 | | |
| 17,764 | |
Severance | |
| 935 | | |
| 116 | | |
| 452 | |
TOTAL
COSTS AND EXPENSES | |
| 1,173,696 | | |
| 1,303,142 | | |
| 1,390,731 | |
Other
operating (expense) gain, net | |
| (4,415 | ) | |
| (826 | ) | |
| 731 | |
Income
from operations | |
| 60,743 | | |
| 60,089 | | |
| 56,990 | |
Interest
income, net | |
| 3,147 | | |
| 146 | | |
| 318 | |
Other
(expense) income, net | |
| (3,083 | ) | |
| (25,352 | ) | |
| 7,916 | |
Income
before income taxes | |
| 60,807 | | |
| 34,883 | | |
| 65,224 | |
(Provision
for) benefit from income taxes | |
| (16,441 | ) | |
| (5,878 | ) | |
| 31,667 | |
NET
INCOME | |
| 44,366 | | |
| 29,005 | | |
| 96,891 | |
Net
income attributable to noncontrolling interests | |
| (3,874 | ) | |
| (1,977 | ) | |
| (416 | ) |
NET
INCOME ATTRIBUTABLE TO IDT CORPORATION | |
$ | 40,492 | | |
$ | 27,028 | | |
$ | 96,475 | |
| |
| | | |
| | | |
| | |
Earnings
per share attributable to IDT Corporation common stockholders: | |
| | | |
| | | |
| | |
Basic | |
$ | 1.59 | | |
$ | 1.05 | | |
$ | 3.78 | |
Diluted | |
$ | 1.58 | | |
$ | 1.03 | | |
$ | 3.70 | |
| |
| | | |
| | | |
| | |
Weighted-average
number of shares used in calculation of earnings per share: | |
| | | |
| | | |
| | |
Basic | |
| 25,517 | | |
| 25,791 | | |
| 25,495 | |
Diluted | |
| 25,577 | | |
| 26,356 | | |
| 26,053 | |
| |
| | | |
| | | |
| | |
(i)
Stock-based compensation included in selling, general and administrative expenses | |
$ | 4,518 | | |
$ | 1,930 | | |
$ | 1,490 | |
IDT
CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year
ended July 31 (in thousands) | |
2023
Unaudited | | |
2022 | | |
2021 | |
OPERATING
ACTIVITIES | |
| | | |
| | | |
| | |
Net
income | |
$ | 44,366 | | |
$ | 29,005 | | |
$ | 96,891 | |
Adjustments
to reconcile net income to net cash provided by operating activities: | |
| | | |
| | | |
| | |
Depreciation
and amortization | |
| 20,136 | | |
| 18,115 | | |
| 17,764 | |
Deferred
income taxes | |
| 12,601 | | |
| 4,801 | | |
| (32,793 | ) |
Provision
for doubtful accounts receivable and reserve for settlement assets | |
| 2,198 | | |
| 2,330 | | |
| 1,782 | |
Net
unrealized loss (gain) from marketable securities | |
| 3,368 | | |
| 18,960 | | |
| (3,262 | ) |
Stock-based
compensation | |
| 4,518 | | |
| 1,930 | | |
| 1,490 | |
Other | |
| 3,175 | | |
| 3,379 | | |
| (4,096 | ) |
Changes
in assets and liabilities: | |
| | | |
| | | |
| | |
Trade
accounts receivable | |
| 4,726 | | |
| (8,279 | ) | |
| 977 | |
Settlement
assets, disbursement prefunding, prepaid expenses, other current assets, and other assets | |
| (17,503 | ) | |
| (21,046 | ) | |
| (6,952 | ) |
Trade
accounts payable, accrued expenses, settlement liabilities, other current liabilities, and other liabilities | |
| (17,216 | ) | |
| (1,110 | ) | |
| (264 | ) |
Customer
deposits at IDT Financial Services Limited (Gibraltar-based bank) | |
| (4,200 | ) | |
| (15,966 | ) | |
| (6,906 | ) |
Deferred
revenue | |
| (2,029 | ) | |
| (2,712 | ) | |
| 1,989 | |
Net
cash provided by operating activities | |
| 54,140 | | |
| 29,407 | | |
| 66,620 | |
INVESTING
ACTIVITIES | |
| | | |
| | | |
| | |
Capital
expenditures | |
| (21,958 | ) | |
| (21,879 | ) | |
| (16,765 | ) |
Payments
for acquisitions, net of cash acquired | |
| — | | |
| (7,552 | ) | |
| (3,673 | ) |
Cash
acquired from acquisition of interest in variable interest entity | |
| — | | |
| — | | |
| 3,336 | |
Purchase
of Rafael Holdings, Inc. Class B common stock and warrant | |
| — | | |
| — | | |
| (5,000 | ) |
Exercise
of warrant to purchase shares of Rafael Holdings, Inc. Class B common stock | |
| — | | |
| — | | |
| (1,000 | ) |
Purchase
of convertible preferred stock in equity method investment | |
| (840 | ) | |
| (1,051 | ) | |
| (4,000 | ) |
Purchases
of debt securities and equity investments | |
| (59,872 | ) | |
| (24,454 | ) | |
| (43,187 | ) |
Proceeds
from maturities and sales of debt securities and redemption of equity investments | |
| 49,211 | | |
| 21,157 | | |
| 26,230 | |
Net
cash used in investing activities | |
| (33,459 | ) | |
| (33,779 | ) | |
| (44,059 | ) |
FINANCING
ACTIVITIES | |
| | | |
| | | |
| | |
Distributions
to noncontrolling interests | |
| (348 | ) | |
| (514 | ) | |
| (848 | ) |
Payment
for acquisition of warrant in variable interest entity | |
| — | | |
| — | | |
| (791 | ) |
Proceeds
from other liabilities | |
| 300 | | |
| 2,301 | | |
| 729 | |
Repayment
of other liabilities | |
| (2,037 | ) | |
| (1,319 | ) | |
| (108 | ) |
Proceeds
from sale of redeemable equity in subsidiary | |
| — | | |
| 10,000 | | |
| — | |
Proceeds
from borrowings under revolving credit facility | |
| 27,383 | | |
| 2,566 | | |
| — | |
Repayments
of borrowings under revolving credit facility | |
| (27,383 | ) | |
| (2,566 | ) | |
| — | |
Proceeds
from exercise of stock options | |
| 172 | | |
| 137 | | |
| 687 | |
Repurchases
of Class B common stock | |
| (13,896 | ) | |
| (26,222 | ) | |
| (4,192 | ) |
Net
cash used in financing activities | |
| (15,809 | ) | |
| (15,617 | ) | |
| (4,523 | ) |
Effect
of exchange rate changes on cash, cash equivalents, and restricted cash and cash equivalents | |
| 4,389 | | |
| (17,365 | ) | |
| 7,656 | |
Net
increase (decrease) in cash, cash equivalents, and restricted cash and cash equivalents | |
| 9,261 | | |
| (37,354 | ) | |
| 25,694 | |
Cash,
cash equivalents, and restricted cash and cash equivalents at beginning of year | |
| 189,562 | | |
| 226,916 | | |
| 201,222 | |
Cash,
cash equivalents, and restricted cash and cash equivalents at end of year | |
$ | 198,823 | | |
$ | 189,562 | | |
$ | 226,916 | |
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION | |
| | | |
| | | |
| | |
Cash
payments made for interest | |
$ | 536 | | |
$ | 461 | | |
$ | 486 | |
Cash
payments made for income taxes | |
$ | 777 | | |
$ | 109 | | |
$ | 193 | |
SUPPLEMENTAL
SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | |
| | | |
| | | |
| | |
Conversion
of equity method investment’s secured promissory notes into convertible preferred stock | |
$ | 4,038 | | |
$ | — | | |
$ | — | |
Stock
issued to certain executive officers for bonus payments | |
$ | 615 | | |
$ | — | | |
$ | — | |
Liabilities
incurred for acquisitions | |
$ | — | | |
$ | 7,849 | | |
$ | 628 | |
Shares
of the Company’s Class B common stock issued for acquisition | |
$ | 100 | | |
$ | 1,000 | | |
$ | — | |
Cashless
exercise of stock options in exchange for shares of the Company’s Class B common stock | |
$ | — | | |
$ | 14,930 | | |
$ | — | |
Stock
issued for matching contributions to the 401(k) Plan | |
$ | — | | |
$ | — | | |
$ | 1,042 | |
Reconciliation
of Non-GAAP Financial Measures for the
Fourth
Quarter and Full Fiscal Years 2023 and 2022
In
addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United
States of America (GAAP), IDT also disclosed for 4Q23, 3Q23, 4Q22, and the full fiscal years 2023 and 2022, Adjusted EBITDA and non-GAAP
earnings per diluted share (EPS), both of which are non-GAAP measures.
Generally,
a non-GAAP measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or
includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance
with GAAP.
IDT’s
measure of non-GAAP EPS is calculated by dividing non-GAAP net income by the diluted weighted-average shares. IDT’s measure of
non-GAAP net income starts with net income attributable to IDT in accordance with GAAP and adds severance expense, stock-based compensation,
and other operating expense, and deducts other operating gains. These additions and subtractions are non-cash and/or non-routine items
in the relevant fiscal 2023 and fiscal 2022 periods.
Management
believes that IDT’s Adjusted EBITDA and non-GAAP EPS are measures which provide useful information to both management and investors
by excluding certain expenses and non-routine gains and losses that may not be indicative of IDT’s or the relevant segment’s
core operating results. Management uses Adjusted EBITDA, among other measures, as a relevant indicator of core operational strengths
in its financial and operational decision making. In addition, management uses Adjusted EBITDA and non-GAAP EPS to evaluate operating
performance in relation to IDT’s competitors. Disclosure of these financial measures may be useful to investors in evaluating performance
and allows for greater transparency to the underlying supplemental information used by management in its financial and operational decision-making.
In addition, IDT has historically reported similar financial measures and believes such measures are commonly used by readers of financial
information in assessing performance, therefore the inclusion of comparative numbers provides consistency in financial reporting.
Management
refers to Adjusted EBITDA, as well as the GAAP measures income (loss) from operations and net income, on a segment and/or consolidated
level to facilitate internal and external comparisons to the segments’ and IDT’s historical operating results, in making
operating decisions, for budget and planning purposes, and to form the basis upon which management is compensated.
While
depreciation and amortization are considered operating costs under GAAP, these expenses primarily represent the non-cash current period
allocation of costs associated with long-lived assets acquired or capitalized in prior periods. IDT’s Adjusted EBITDA, which is
exclusive of depreciation and amortization, is a useful indicator of its current performance.
Severance
expense is excluded from the calculation of Adjusted EBITDA and non-GAAP EPS. Severance expense is reflective of decisions made by management
in each period regarding the aspects of IDT’s and its segments’ businesses to be focused on in light of changing market realities
and other factors. While there may be similar charges in other periods, the nature and magnitude of these charges can fluctuate markedly
and do not reflect the performance of IDT’s core and continuing operations.
Other
operating (expense) gain, net, which is a component of income (loss) from operations, is excluded from the calculation of Adjusted EBITDA
and non-GAAP EPS. Other operating (expense) gain, net includes, among other items, gains from the write-off of contingent consideration
liabilities, legal fees net of insurance claims related to Straight Path Communications Inc.’s stockholders’ class action,
and expense for the indemnification of a cable telephony customer related to a legal settlement. From time-to-time, IDT may have gains
or incur costs related to non-routine legal and other matters, however, these various items generally do not occur each quarter. IDT
believes the gain and losses from these non-routine matters are not components of IDT’s or the relevant segment’s core operating
results.
Stock-based
compensation recognized by IDT and other companies may not be comparable because of the variety of types of awards as well as the various
valuation methodologies and subjective assumptions that are permitted under GAAP. Stock-based compensation is excluded from IDT’s
calculation of non-GAAP EPS because management believes this allows investors to make more meaningful comparisons of the operating results
per share of IDT’s core business with the results of other companies. However, stock-based compensation will continue to be a significant
expense for IDT for the foreseeable future and an important part of employees’ compensation that impacts their performance.
Adjusted
EBITDA and non-GAAP EPS should be considered in addition to, not as a substitute for, or superior to, income (loss) from operations,
cash flow from operating activities, net income, basic and diluted earnings per share or other measures of liquidity and financial performance
prepared in accordance with GAAP. In addition, IDT’s measurements of Adjusted EBITDA and non-GAAP EPS may not be comparable to
similarly titled measures reported by other companies.
Following
are reconciliations of Adjusted EBITDA and non-GAAP EPS to the most directly comparable GAAP measure, which are, (a) for Adjusted EBITDA,
income (loss) from operations for IDT’s reportable segments and net income for IDT on a consolidated basis, and (b) for non-GAAP
EPS, diluted earnings per share.
IDT
Corporation
Reconciliation
of Net Income to Adjusted EBITDA
(unaudited)
in millions. Figures may not foot or cross-foot due to rounding to millions
| |
Total
IDT Corporation | | |
Traditional
Communica-tions | | |
net2phone | | |
NRS | | |
Fintech | | |
Corporate | |
Three
Months Ended July 31, 2023 (4Q23) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to IDT Corporation | |
$ | 8.0 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Adjustments: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to noncontrolling interests | |
| 0.8 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income | |
| 8.8 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Provision
for income taxes | |
| 3.8 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
before income taxes | |
| 12.6 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest
income, net | |
| (1.1 | ) | |
| | | |
| | | |
| | | |
| | | |
| | |
Other
expense, net | |
| 0.5 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
(loss) from operations | |
| 12.0 | | |
$ | 14.1 | | |
$ | (0.7 | ) | |
$ | 1.7 | | |
$ | (1.9 | ) | |
$ | (1.2 | ) |
Depreciation
and amortization | |
| 5.1 | | |
| 2.3 | | |
| 1.5 | | |
| 0.7 | | |
| 0.7 | | |
| - | |
Severance | |
| 0.5 | | |
| 0.4 | | |
| 0.1 | | |
| - | | |
| - | | |
| - | |
Other
operating expense, net | |
| 0.5 | | |
| 1.8 | | |
| 0.1 | | |
| - | | |
| - | | |
| (1.4 | ) |
Adjusted
EBITDA | |
$ | 18.1 | | |
$ | 18.6 | | |
$ | 0.9 | | |
$ | 2.4 | | |
$ | (1.2 | ) | |
$ | (2.6 | ) |
IDT
Corporation
Reconciliation
of Net Income to Adjusted EBITDA
(unaudited)
in millions. Figures may not foot or cross-foot due to rounding to millions
| |
Total
IDT Corporation | | |
Traditional
Communica-tions | | |
net2phone | | |
NRS | | |
Fintech | | |
Corporate | |
Three
Months Ended April 30, 2023 (3Q23) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to IDT Corporation | |
$ | 6.9 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Adjustments: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to noncontrolling interests | |
| 0.9 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income | |
| 7.7 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Provision
for income taxes | |
| 3.0 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
before income taxes | |
| 10.7 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest
income, net | |
| (0.7 | ) | |
| | | |
| | | |
| | | |
| | | |
| | |
Other
expense, net | |
| 0.4 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
(loss) from operations | |
| 10.4 | | |
$ | 12.9 | | |
$ | (0.4 | ) | |
$ | 2.1 | | |
$ | (1.3 | ) | |
$ | (2.9 | ) |
Depreciation
and amortization | |
| 5.2 | | |
| 2.5 | | |
| 1.4 | | |
| 0.6 | | |
| 0.7 | | |
| - | |
Severance | |
| 0.1 | | |
| 0.1 | | |
| - | | |
| - | | |
| - | | |
| - | |
Other
operating expense, net | |
| 4.8 | | |
| 4.1 | | |
| - | | |
| - | | |
| - | | |
| 0.6 | |
Adjusted
EBITDA | |
$ | 20.5 | | |
$ | 19.7 | | |
$ | 1.0 | | |
$ | 2.7 | | |
$ | (0.6 | ) | |
$ | (2.3 | ) |
| |
Total
IDT Corporation | | |
Traditional
Communica-tions | | |
net2phone | | |
NRS | | |
Fintech | | |
Corporate | |
Three
Months Ended July 31, 2022 (4Q22) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to IDT Corporation | |
$ | 17.2 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Adjustments: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to noncontrolling interests | |
| 0.7 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income | |
| 18.0 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Benefit
from income taxes | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
before income taxes | |
| 18.0 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest
expense, net | |
| 0.1 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Other
expense, net | |
| 1.1 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
(loss) from operations | |
| 19.2 | | |
$ | 18.0 | | |
$ | (1.8 | ) | |
$ | 6.7 | | |
$ | (1.9 | ) | |
$ | (1.9 | ) |
Depreciation
and amortization | |
| 4.8 | | |
| 2.4 | | |
| 1.4 | | |
| 0.4 | | |
| 0.6 | | |
| - | |
Other
operating expense, net | |
| 0.1 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 0.1 | |
Adjusted
EBITDA | |
$ | 24.1 | | |
$ | 20.5 | | |
$ | (0.4 | ) | |
$ | 7.1 | | |
$ | (1.3 | ) | |
$ | (1.7 | ) |
IDT
Corporation
Reconciliation
of Net Income to Adjusted EBITDA
(unaudited)
in millions. Figures may not foot or cross-foot due to rounding to millions
| |
Total
IDT Corporation | | |
Traditional
Communica-tions | | |
net2phone | | |
NRS | | |
Fintech | | |
Corporate | |
Year
Ended July 31, 2023 (FY 2023) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to IDT Corporation | |
$ | 40.5 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Adjustments: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to noncontrolling interests | |
| 3.9 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income | |
| 44.4 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Provision
for income taxes | |
| 16.4 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
before income taxes | |
| 60.8 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest
income, net | |
| (3.1 | ) | |
| | | |
| | | |
| | | |
| | | |
| | |
Other
expense, net | |
| 3.1 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
(loss) from operations | |
| 60.7 | | |
$ | 61.3 | | |
$ | (2.8 | ) | |
$ | 14.4 | | |
$ | (2.5 | ) | |
$ | (9.7 | ) |
Depreciation
and amortization | |
| 20.1 | | |
| 9.4 | | |
| 5.6 | | |
| 2.4 | | |
| 2.7 | | |
| - | |
Severance | |
| 0.9 | | |
| 0.9 | | |
| 0.1 | | |
| - | | |
| - | | |
| - | |
Other
operating expense (gain), net | |
| 4.4 | | |
| 5.9 | | |
| 0.1 | | |
| - | | |
| (1.9 | ) | |
| 0.3 | |
Adjusted
EBITDA | |
$ | 86.2 | | |
$ | 77.5 | | |
$ | 3.0 | | |
$ | 16.8 | | |
$ | (1.8 | ) | |
$ | (9.3 | ) |
| |
Total
IDT Corporation | | |
Traditional
Communica-tions | | |
net2phone | | |
NRS | | |
Fintech | | |
Corporate | |
Year
Ended July 31, 2022 (FY 2022) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to IDT Corporation | |
$ | 27.0 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Adjustments: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to noncontrolling interests | |
| 2.0 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income | |
| 29.0 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Provision
for income taxes | |
| 5.9 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
before income taxes | |
| 34.9 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest
income, net | |
| (0.1 | ) | |
| | | |
| | | |
| | | |
| | | |
| | |
Other
expense, net | |
| 25.4 | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income
(loss) from operations | |
| 60.1 | | |
$ | 75.8 | | |
$ | (11.1 | ) | |
$ | 11.2 | | |
$ | (6.9 | ) | |
$ | (8.9 | ) |
Depreciation
and amortization | |
| 18.1 | | |
| 9.5 | | |
| 5.4 | | |
| 0.9 | | |
| 2.2 | | |
| 0.1 | |
Severance | |
| 0.1 | | |
| 0.1 | | |
| - | | |
| - | | |
| 0.1 | | |
| - | |
Other
operating expense (gain), net | |
| 0.8 | | |
| 0.1 | | |
| (0.3 | ) | |
| - | | |
| - | | |
| 1.0 | |
Adjusted
EBITDA | |
$ | 79.1 | | |
$ | 85.5 | | |
$ | (6.1 | ) | |
$ | 12.1 | | |
$ | (4.6 | ) | |
$ | (7.8 | ) |
IDT
Corporation
Reconciliation
of Earnings per share to Non-GAAP EPS
(unaudited)
in millions, except per share data. Figures may not foot due to rounding to millions.
| |
4Q23 | | |
3Q23 | | |
4Q22 | | |
FY
2023 | | |
FY
2022 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Net
income attributable to IDT Corporation | |
$ | 8.0 | | |
$ | 6.9 | | |
$ | 17.2 | | |
$ | 40.5 | | |
$ | 27.0 | |
Adjustments
(add): | |
| | | |
| | | |
| | | |
| | | |
| | |
Stock-based
compensation | |
| (1.0 | ) | |
| (1.7 | ) | |
| (0.1 | ) | |
| (4.5 | ) | |
| (1.9 | ) |
Severance
expense | |
| (0.5 | ) | |
| (0.1 | ) | |
| (0.1 | ) | |
| (0.9 | ) | |
| (0.1 | ) |
Other
operating expense, net | |
| (0.5 | ) | |
| (4.8 | ) | |
| (0.1 | ) | |
| (4.4 | ) | |
| (0.8 | ) |
Total
adjustments | |
| (2.0 | ) | |
| (6.6 | ) | |
| (0.3 | ) | |
| (9.8 | ) | |
| (2.8 | ) |
Income
tax effect of total adjustments | |
| (0.7 | ) | |
| (1.8 | ) | |
| - | | |
| (2.6 | ) | |
| (0.4 | ) |
| |
| 1.3 | | |
| 4.8 | | |
| 0.3 | | |
| 7.2 | | |
| 2.4 | |
Non-GAAP
net income | |
$ | 9.3 | | |
$ | 11.7 | | |
$ | 17.5 | | |
$ | 47.7 | | |
$ | 29.4 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Earnings
per share: | |
| | | |
| | | |
| | | |
| | | |
| | |
Basic | |
$ | 0.31 | | |
$ | 0.27 | | |
$ | 0.66 | | |
$ | 1.59 | | |
$ | 1.05 | |
Total
adjustments | |
| 0.06 | | |
| 0.19 | | |
| 0.01 | | |
| 0.28 | | |
| 0.09 | |
Non-GAAP
- basic | |
$ | 0.37 | | |
$ | 0.46 | | |
$ | 0.67 | | |
$ | 1.87 | | |
$ | 1.14 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Weighted-average
number of shares used in calculation of basic earnings per share | |
| 25.4 | | |
| 25.5 | | |
| 26.0 | | |
| 25.5 | | |
| 25.8 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Diluted | |
$ | 0.31 | | |
$ | 0.27 | | |
$ | 0.66 | | |
$ | 1.58 | | |
$ | 1.03 | |
Total
adjustments | |
| 0.05 | | |
| 0.19 | | |
| 0.01 | | |
| 0.28 | | |
| 0.09 | |
Non-GAAP
- diluted | |
$ | 0.36 | | |
$ | 0.46 | | |
$ | 0.67 | | |
$ | 1.86 | | |
$ | 1.12 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Weighted-average
number of shares used in calculation of diluted earnings per share | |
| 25.5 | | |
| 25.6 | | |
| 26.1 | | |
| 25.6 | | |
| 26.4 | |
*Explanation
of Key Performance Metrics
NRS’
recurring revenue is NRS’ revenue in accordance with GAAP excluding revenue from POS terminal sales. NRS’ Monthly Average
Recurring Revenue per Terminal is a financial metric. Monthly Average Recurring Revenue per Terminal is calculated by dividing NRS’
recurring revenue by the average number of active POS terminals during the period. The average number of active POS terminals is calculated
by adding the beginning and ending number of active POS terminals during the period and dividing by two. NRS’ recurring revenue
divided by the average number of active POS terminals is divided by three when the period is a fiscal quarter. Recurring revenue and
Monthly Average Recurring Revenue per Terminal are useful for comparisons of NRS’ revenue and revenue per customer to prior periods
and to competitors and others in the market, as well as for forecasting future revenue from the customer base.
BOSS
Money’s Average Revenue per Transaction is also a financial metric. Average Revenue per Transaction is calculated by dividing BOSS
Money’s revenue in accordance with GAAP by the number of transactions during the period. Average Revenue per Transaction is useful
for comparisons of BOSS Money’s revenue per transaction to prior periods and to competitors and others in the market, as well as
for forecasting future revenue based on transaction trends.
net2phone’s
subscription revenue is its revenue in accordance with GAAP excluding its equipment revenue and revenue generated by a legacy SIP trunking
offering in Brazil. net2phone’s cloud communications offerings are priced on a per-seat basis, with customers paying based on the
number of users in their organization. The number of seats served and subscription revenue trends and comparisons between periods are
used in the analysis of net2phone’s revenues and direct cost of revenues, and are strong indications of the top-line growth and
performance of the business.
#
# #
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