c23b53cc4c6b3fc52fcba529b3fc9057a4ba74df6f446b85e7c7090037340de7

c443676b9e3b0ea8ab5a53e559ca0cf3221bf56cb13aa3bca9b09ec3a7110a69

ba656423ba177365e3ae61cff9968951bed3c6620ae0ae71abad0541a952392f

Total Revenue

SaaS and Related Solutions Revenue

Software and Services Revenue

Maintenance Revenue

4ea8da8c15ddb8e890d38bb04205909809f9a7a2929be0f55e51c16f19955633

Revenue (USD, thousands)

Cost of revenue (exclusive of depreciation, shown separately below) (USD, thousands)

Research and development (USD, thousands)

Selling, general and administrative (USD, thousands)

Depreciation (USD, thousands)

Restructuring and reorganization charges (USD, thousands)

Total operating expenses (USD, thousands)

Operating income (USD, thousands)

Interest expense (USD, thousands)

Interest income (USD, thousands)

Other, net (USD, thousands)

Total other (USD, thousands)

Income before income taxes (USD, thousands)

Income tax provision (USD, thousands)

Net income (USD, thousands)

803dea813c48aa229c6a9d26453298244fcb4f388ef223c7085c971a34729e8e

292ee330f58843d69c6f48ae70f7b5d5149b539d84f61ad30b2763d7219d646b

The sharp decline in cash in Q1 2024 was driven primarily by **significant cash outflows used in operations** due to unfavorable working capital changes—including the payment of 2023 year-end accrued employee incentive compensation and timing issues in trade accounts receivable collections.  **[0000950170-24-051767_csgs-20240331.htm:23]** **[0000950170-24-051255_csgs-ex99_1.htm:0]** **[CSGS_3382015_5]**  Additionally, the company executed **stock repurchases of approximately 185,000 shares for $9.6 million** and paid **dividends amounting to $8.9 million**.  **[0000950170-24-051255_csgs-ex99_1.htm:0]** **[0000950170-24-051767_csgs-20240331.htm:28]**  There were also acquisition-related outlays, including **$0.5 million in deferred acquisition payments** and an **$11.5 million asset acquisition**, as well as a notable reduction in restricted cash from settlement and merchant reserve assets, which dropped from **$274,699 thousand to $192,962 thousand**.  **[0000950170-24-051767_csgs-20240331.htm:28]** **[0000950170-24-051767_csgs-20240331.htm:23]** **[0000950170-24-051767_csgs-20240331.htm:2]** 

What drove the sharp decline in cash in Q1 2024?

The drop in total assets in Q1 2024 was driven primarily by **four key factors**. First, there was a significant **decrease in cash and cash equivalents** due to cash flows used in operating activities—primarily unfavorable working capital changes including the payment of accrued employee incentive compensation—and additional reductions from **share repurchases** and **dividend payments**. Second, there was a notable **reduction in settlement and merchant reserve assets**, likely related to timing differences in settlement activities and associated cash flows. Third, changes in **trade accounts receivable** occurred, with unbilled amounts rising modestly, reflecting timing differences in revenue recognition and billing cycles. Lastly, a **reduction in non-current assets**, including a decline in goodwill driven by foreign currency translation adjustments and the impact of amortizing acquired customer contracts and software, also contributed to the total assets decline.  **[0000950170-24-051255_csgs-ex99_1.htm:3]** **[0000950170-24-051767_csgs-20240331.htm:10]** **[0000950170-24-051767_csgs-20240331.htm:19]** **[0000950170-24-051255_csgs-ex99_1.htm:0]** **[CSGS_3382015_5]** 

What factors contributed to the drop in total assets in Q1 2024?

e61cec071378378157db0f5419270846b84031bafe5a430bad5eaaae2645da82

The significant drop in operating income in Q4 2023 is primarily attributed to an **increase in restructuring and reorganization charges**, which rose by **$7,915 thousand** compared to Q4 2022, along with **higher operating expenses**—increasing from **$254,804 thousand** in Q4 2022 to **$272,577 thousand** in Q4 2023. These factors collectively resulted in a **29.4% decrease** in operating income, reducing it to **$24,747 thousand** in Q4 2023.  **[0000950170-24-012195_csgs-ex99_1.htm:1]** **[0000950170-24-012195_csgs-ex99_1.htm:5]** 

Why did Operating income drop so significantly in Q4 2023?

The lower net income in Q4 2023 was primarily attributed to several factors. **Increased restructuring and reorganization charges** rose significantly (**$7,915 thousand** compared to **$4 thousand** in Q4 2022), which had a considerable impact on reducing operating income. Additionally, **higher interest expense** (**$8,084 thousand**, up from **$6,146 thousand** in Q4 2022) further reduced net income. Finally, **lower operating income** (dropping to **$24,747 thousand** from **$35,072 thousand** in the previous year) also contributed to the decline. These factors combined led to the lower net income in Q4 2023.  **[0000950170-24-012195_csgs-ex99_1.htm:5]** **[0000950170-24-012195_csgs-ex99_1.htm:1]** 

What contributed to the lower Net income in Q4 2023?

The documents do not provide a definitive analysis on whether the **higher SG&A expenses in Q4 2023** are pressuring margins. However, increased SG&A costs, like the **3.9% rise ($2,498,000 increase)** compared to Q4 2022, could potentially reduce profit margins if not offset by proportional revenue growth or cost efficiencies.  **[0000950170-24-012195_csgs-ex99_1.htm:5]** 

Could the higher SG&A expenses in Q4 2023 be pressuring margins?

The spike in Restructuring and reorganization charges in Q2 2024 was primarily driven by a **reduction in CSG's global workforce**. This workforce reduction was part of an initiative to **better align and allocate resources** to areas of the business where new growth opportunities have been identified.  **[0000950170-24-093482_csgs-20240630.htm:17]** **[0000950170-24-093482_csgs-20240630.htm:24]** **[0000950170-24-093482_csgs-20240630.htm:27]** 

What drove the spike in Restructuring and reorganization charges in Q2 2024?

f9f12a51e45c9a7cbc0aaf3444a6527d1e60fead91d95a8681aca23108ad7a1d

Amortization (USD, thousands)

Unrealized foreign currency transaction (gain) loss, net (USD, thousands)

Stock-based compensation (USD, thousands)

Purchases of software, property, and equipment (USD, thousands)

Net cash provided by (used in) investing activities (USD, thousands)

Proceeds from issuance of common stock (USD, thousands)

Payment of cash dividends (USD, thousands)

Repurchase of common stock (USD, thousands)

Deferred acquisition payments (USD, thousands)

Proceeds from long-term debt (USD, thousands)

Payments on long-term debt (USD, thousands)

Payments of deferred financing costs (USD, thousands)

Payments on financing obligations (USD, thousands)

Settlement and merchant reserve activity (USD, thousands)

Net cash used in financing activities (USD, thousands)

Effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash (USD, thousands)

Net decrease in cash, cash equivalents, and restricted cash (USD, thousands)

Interest paid (USD, thousands)

Income taxes paid (USD, thousands)

Net Cash Provided by (Used In) Operating Activities - Totals (USD, thousands)

Deferred income taxes (USD, thousands)

Trade accounts receivable, net (USD, thousands)

Other current and non-current assets and liabilities (USD, thousands)

Income taxes payable/receivable (USD, thousands)

Trade accounts payable and accrued liabilities (USD, thousands)

Deferred revenue (USD, thousands)

Cash, cash equivalents, and restricted cash, beginning of period (USD, thousands)

Cash, cash equivalents, and restricted cash, end of period (USD, thousands)

576c211213febb923495a4e296d02c11ab4f3e914bf8d908bda4b01e99a277a5

Americas (principally the U.S.) [USD Million]

Europe, Middle East, and Africa (EMEA) [USD Million]

Asia Pacific [USD Million]

Total Revenue [USD Million]

99d0697a39dd957468231a34a1297b1573b091577c335690aa8b7594b8b3def4

CSG Systems International Inc (CSGS)

Financials