ACI Worldwide Inc

NASDAQ:ACIW

Earnings Call Transcript 2022-Q3

[Operator]

Good morning. My name is Abby, and I will be your conference operator today. At this time, I would like to welcome everyone to the ACI Worldwide Quarter 3 Earnings 2022 Conference Call. [Operator Instructions]

Thank you. Mr. John Kraft, Senior Vice President of Finance and Strategy, you may begin your conference.

[John Kraft, Senior Vice President of Finance and Strategy]

Thank you, and good morning, everyone. On today's call, we will discuss the company's third quarter 2022 results and financial outlook for the rest of the year. We will take your questions at the end. The slides accompanying this call and webcast can be found at aciworldwide.com under the Investor Relations tab and will remain available after the call.

Today's call is subject to safe harbor and forward-looking statements like all of our events. You can find the full text of both statements on the first and final pages of our presentation deck, a copy of which is available on our website and with the SEC. On this morning's call is Odilon Almeida, our President and CEO; and Scott Behrens, our CFO.

Before I turn it over, I'd like to say that ACI will attend the Citi 2022 Fintech Conference in New York City on November 15 and the Stephens Annual Investment Conference in Nashville on November 17.

With that, I'd like to turn the call over to Odilon.

[Odilon Almeida, President, CEO and Director]

Thank you, John. Hello, everyone, and thank you for joining our third quarter 2022 earnings conference call. We are pleased to have delivered another quarter of revenue in line with guidance. We have demonstrated the resilience of ACI's business in a macro environment pressured by foreign exchange and inflation.

Despite the macro environment headwinds, it is significant that we can maintain our full year 2022 constant currency revenue growth in the mid-single digits after factoring in the corporate online banking divestiture. Revenue for the quarter was up 1% adjusted for FX and by divestiture adjusted EBITDA was down 36%, adjusted by FX and the divestiture.

It is important to add color to the near-term pressure on our adjusted EBITDA from FX and inflation. I have two critical points to share about this: First, the impact of inflation is restricted to the interchange component of our Biller business. We have been able to manage the inflationary pressures effectively across all other P&L lines and business segments.

Second, we have a dedicated team leading multiple initiatives to minimize this impact. These efforts are paying off. At this point, we have been able to offset 1/3 of the effect of inflation on Biller interchange this year. We intensify our efforts as we move into next year. These efforts include initiatives with customers, credit cards and consumers.

I will turn now to some other highlights from the quarter. Our new overall ARR bookings were up 35% versus Q3 2021 or up 40% on a year-to-date basis, specifically, merchants, new ARR bookings grew by nearly 50% in the quarter. In Billers, new ARR bookings grew by 132%. In this volatile macro environment, these wins increased visibility into future revenue.

It gives us greater confidence in our accelerating growth journey. I'm also pleased to announce that we successfully closed the sale of our corporate online banking solutions. We are glad that the new company Dragonfly is serving our corporate online banking customers and employees while taking the business to the next level.

We are on track to launch our next-generation real-time payments technology platform in 2023, driving new growth across our business segments.

We will give you more detail about the opportunities this creates for ACI and our customers at our Investor Day next year.

Turning to our share buyback program, we repurchased 3.2 million shares for $91 million year-to-date. As of September 30, 2022, we still have $125 million remaining on our share repurchase authorization.

Now let me turn to some recent wins. Last quarter, I flagged the vital role of central government in championing real-time payments. We continue to gain traction in the Middle East. We won another important central infrastructure deal in the region. Qatar's Central Bank, we use ACI's real-time central infrastructure software, including fraud management.

Other bank wins include Abu Dhabi Commercial Bank, Malaysia's CIMB Bank, Europe's Nexi Group, a paytech provider with presence in 25 countries; Italian branch of Worldline Financial Services; Prosa, Mexico's largest processor and clearing house with presence of Prosa Latin America; IBM Canada; and the U.S. branch of a leading bank headquartered in Kuala Lumpur.

In our Merchant segment, our wins include a major Middle Eastern Airline, Cyprus [Indiscernible], Italy's [Indiscernible] and U.S. fintech Corepay. Our U.S. Biller segment has record bookings. The ACI Speedpay will be used by two new Fortune 500 companies and Connect Holding, a fiber optic company offering Internet services into any states.

I'm happy to see that the disciplined execution of our 3-pillar strategy continues to work on our accelerating growth and value creation journey.

Now I'll turn it to Scott. Scott?

[Scott Behrens, Executive VP, CFO and CAO]

Thanks, Odilon, and good morning, everyone. I first plan to review our financial results for Q3 and then provide our outlook for the rest of 2022. We'll then open the line for questions.

Third quarter revenue was $307 million, up 1% adjusted for FX and the corporate online banking divestiture, which we completed on September 1 of this year. Adjusted EBITDA for the quarter was $46 million, down 36%, again, adjusted for FX and the divestiture.

New ARR bookings in Q3 were $30 million, up 35% versus Q3 2021 and are up 40% year-to-date. And here in October, we signed a new logo representing one of the largest Biller customers.

Turning to our segment results. Bank segment revenue was $117 million, down 4% after adjusting for FX and the divestiture, and segment adjusted EBITDA decreased 23% adjusted for FX in the divestiture versus Q3 2021.

And as a reminder, in the bank segment, we saw more renewal in the license deals in the first half of this year compared to 2021. So if you look at the bank segment year-to-date, revenue and EBITDA are both up around 20% over last year. Merchant segment revenue was $36 million, down 3% adjusted for FX, while segment adjusted EBITDA was down 26% adjusted for FX versus Q3 last year.

Biller segment revenue grew 5% and the segment adjusted EBITDA decreased 18% versus Q3 2021. And as a reminder, the Biller segment is all U.S.-based customers, so it had minimal FX impact. We ended the quarter with $135 million in cash on hand and a debt balance of $1 billion. It represents a net debt leverage ratio of 2.3x, which is just below our 2.5x target.

Finally, I'll turn to our outlook for 2022. We are reiterating our full year revenue expectations to grow revenue in the mid-single digits on a constant currency basis, which we previously provided in September following the divestiture close. We are updating our revenue range only for the impact of FX fluctuations. So our updated full year revenue guidance moves to a range of $1.39 billion to $1.405 billion.

Regarding EBITDA guidance, FX and inflation are pressuring our results in the near term. The inflationary pressure is really isolated to the interchange fees in our Biller segment, where our price per transaction is fixed, but the interchange fluctuates with the average ticket size. Though this is expected to impact us in the near term, we have several initiatives underway, including price adjustments to mitigate the impact in the medium term.

As a result, we expect full year 2022 adjusted EBITDA to be in the range of $365 million to $380 million. In terms of capital allocation, we continue to deploy approximately half of our cash flow towards share repurchases. We've repurchased just over 1 million shares during Q3. And year-to-date through the end of September, we have repurchased just over 3 million shares, and we have $125 million remaining on our current repurchase authorization.

With that, I will pass it back to Odilon for some closing comments. Odilon?

[Odilon Almeida, President, CEO and Director]

Thank you, Scott. In summary, we delivered another quarter of revenue in line with guidance, demonstrating the resilience of ACI's business. Despite of the economic macro environment, we are maintaining our 2022 guidance in constant currency revenue growth in the mid-single digits. While we are experiencing near-term pressure on our adjusted EBITDA from FX and inflation, the impact of inflation is limited to the interchange component of our Biller business.

Our action to address the impact is working and scaling. Despite these near-term headwinds, the strong momentum in our new business wins and our solid ARR bookings across our segments continue to validate our 3-pillar strategy. Our industry-leading real-time payment solutions are critical to the modernization agendas of customers, including leading corporations, financial institutions, fintechs, merchants and billers.

In an environment where many companies are facing reduced visibility, our Q3 wins and bookings differentiate ACI. They reinforce our confidence in our accelerating growth journey.

I thank our ACI employees for their dedication and our partners and customers for their trust. Thank you all for joining us today. And now we will open the line for Q&A.

[Operator]

[Operator Instructions] Your first question comes from the line of Mayank Tandon from Needham & Company.

[Mayank Tandon, Needham & Company]

Odilon and Scott, could you maybe delve into the impact of interchange a little bit more in detail how that sort of flow through the P&L? I didn't quite grasp that. And then in terms of the efforts you're taking on to address that challenge, could you maybe, again, provide a little bit more detail on how that works and when we should be seeing the benefits of that?

[Scott Behrens, Executive VP, CFO and CAO]

Yes. The interchanges -- and maybe to clarify, it's specific to or where we're seeing the inflationary pressure is specific to our utility vertical within Biller. We're seeing lesser in other ones, but it's in the utility vertical really spiked here in the summer months. The mechanism for which we price those contracts are generally based on a payment mix, but this isn't really a mix issue. This is an average ticket size, so the energy prices spiked in the summer months, and we're expecting that level of average ticket size to continue on to the rest of the year.

That interchange cost where it flows through, if you're looking at it from our financial statements is in the cost of revenue. And then in terms of the things we're doing, really, in order to react to this, you can't -- it's not something you can do within, say, 30, 60, 90 days. It's really we're going contract-by-contract, and including things such as price adjustment working with the customers. So that's why we can't affect those things in what I call short term, meaning that's why we're adjusting our guidance for the year because we've done -- we have taken actions. We think we've been able to solve for about 1/3 of the impact of that inflation in year. And we've also taken other cost actions, so non-interchange cost savings to minimize the effect this year, and then we'll get a full year benefit of that next year, but we're continuing to work customer-by-customer to make those adjustments.

[Odilon Almeida, President, CEO and Director]

Mayank, just to add more color. This matter we'd interchange and all these task force has my full attention. We are meeting on a weekly basis. We are very proud of the team because we were able to, I would say, in a 6 months' effort of less than that, 3 months effort really find like a 1/3 already benefit on the whole impact. And I'm much more positive about next year.

It is not something easy to fix because it's contract-by-contract. The other thing important to clarify is this is not only increasing prices to our customers, it's really about generating a win-win solution. When our customers make more sense and we make more sense, they make more money and we make more money because consumers migrate from higher cost payment methods to lower cost payment methods, for example, from expensive credit cards to ACH. And that's the effort that is working. And again, we are very positive about that next year.

[Mayank Tandon, Needham & Company]

Okay. This is a very helpful color. And then let me ask you one broader question. In terms of your transaction-driven growth on the merchant and the Biller side, how does the global slowdown [Indiscernible]

[Scott Behrens, Executive VP, CFO and CAO]

Go ahead, Mayank. Fire alarm. We have like a fire alarm here at the [Indiscernible]. Hopefully, it's not in our floor. So keep going.

[Mayank Tandon, Needham & Company]

Okay. I was just asking more in terms of the transaction-driven business. What are you seeing right now in terms of trends? Clearly, the ARR growth is positive, but as you go into potentially a slowdown or a recession, how does that affect the transaction-driven segments, especially the Biller and the Merchant services side?

[Odilon Almeida, President, CEO and Director]

Yes, that's a good question. At this moment, we don't have a top line problem. And you can see by our guidance, we're going to continue to grow by mid-digit this year, as we said before, in constant currency. And we think we're going to continue to accelerate going forward. And that's the idea. So I don't see a gross revenue problem. The problem is very isolated, an interchange of Billers. Again, we see signs of recession in some continents. But at this point, nothing that can -- that could impact our top line.

[Scott Behrens, Executive VP, CFO and CAO]

Yes. The only other thing I'd add to that is, it's especially the merchant area because I think that's where you probably see it. We actually see transaction volumes picking up as we're entering the fourth quarter and exiting the year. So that -- so I don't think at this point, we're seeing a lot of weakness in the merchant transaction.

[Operator]

Your next question comes from the line of Peter Heckmann from Davidson.

[Peter Heckmann, Davidson]

I was just curious in terms of the bookings year-to-date by segment, certainly, Biller really stood out this quarter. I can't remember if you've given that disclosure in the past, but do you have that at your fingertips?

[Scott Behrens, Executive VP, CFO and CAO]

I don't -- yes, the quarter had Biller was strong and merchant was strong. I think if you look at it across the whole year, I think you pulled in banks, banks had stronger in Q1 and Q2 because that's where we saw a lot of the renewal activity and net new, and that's where we get a lot of the new ARR on the bank side. So I think it was pretty -- if you look at it over the course of the 9 months, it's pretty broad-based across the three segments. In Q3, it was very specific to Merchant and Biller.

[Odilon Almeida, President, CEO and Director]

And Peter, your question is very important, because we expect this year to have a record in ARR in the three segments when we close Q4. And that's very important for next year. So let me just give more color. When we talk about ARR bookings, we are talking about the expectation of revenue that we have after launching in the first year. And so when you talk about, for example, $2 million on the contract of ARR bookings, what you're seeing is that, after launch, for example, in Merchant and Biller is around 3 to 6 months and bank is around 1 year. After launching, we expect to have that $2 million of revenue going forward. So when we talk about increasing this -- by this amount, they are signing, that gives us a lot of visibility into the next year.

[Peter Heckmann, Davidson]

Okay. That's helpful. And then you mentioned you signed a billing customer that will wind up being one of your largest, but just a little bit more color there. Was that a totally new to ACI or something or the customer consolidated services? And then when would you expect that particular customer to go live?

[Odilon Almeida, President, CEO and Director]

Totally new to ACI. And again, there was like a lot of competition on that, and we are very happy that we are able to win. We will be -- this is a very complex launch. So probably it's going to be a rollout. And -- but I would expect that most of the result of that Biller will be in 2024, but we're going to have a good part of it already 2023. So it's really a 2 years launch because it's a very complex and that's a huge business, right? Very, very important business.

[Peter Heckmann, Davidson]

Okay. Great. And then just maybe one last housekeeping item. But just in terms of isolating the divestiture and FX was divested revenue approximately $4 million to $5 million and then FX was approximately like 400 basis points headwind.

[Scott Behrens, Executive VP, CFO and CAO]

Yes, that's a good figure. Yes, because the divestiture really only pulled out a month's worth of activity in the September month.

[Operator]

Your next question comes from the line of Joseph Vafi from Canaccord Genuity.

[Joseph Vafi, Canaccord Genuity]

Nice to see the ARR bookings remained strong. Just one more on the Biller. I think you recovered maybe 1/3 of that lost EBITDA there. And I know you can't really provide guidance on it, but do you think you can -- you would be able to recapture the majority of it? Or is there a goal or a number we should be thinking about on those renegotiations and the way some of those contracts are structured.

[Odilon Almeida, President, CEO and Director]

When you say that we are recovering 1/3, we are talking about the whole year. So the impact that we are expecting in the whole year, we are projecting that we are going to recover 1/3. Most of it we have already recovered, but some more recovery to happen in the next 2 months, November and December. So 1/3 is related to the whole year this year.

When you talk about next year, if inflation continues, I think the pressures will continue. But as we have already started working on that, I'm much more positive about next year because in -- basically 4 or 5 months -- 3 to 4 months that we put together this task force, we are really able to find 1/3. So -- and we are working already not only for this year, but also for next year. So I'm much more positive about next year.

[Joseph Vafi, Canaccord Genuity]

Got it. And then I know the ARR has been strong. Has there been -- as part of -- I mean, clearly, you've got a more focused sales force and a more focused product set now. Have you seen some conversion of some of the -- more of the license business to kind of cloud? And is that part of the strength in ARR? Or has the -- maybe an update on license sales versus cloud sales in general would be good, too?

[Odilon Almeida, President, CEO and Director]

Yes. No, thank you, Joe. In reality, we have not seen a lot of migration from license to SaaS in our base. I mean what is license continues to be licensed. And SaaS is all about new logos. The SaaS business that we are generating is all about new logos in banks. So it is really incremental to the license business when you talk about banks.

When you talk about merchants, most of the -- most of the revenues are already SaaS and below the 100% of that business is SaaS. And we are expecting to have a record year in the three segments for SaaS deals, for ARR bookings, right? So it is a very positive story and is helping us in our journey to have more recurring revenue.

[Operator]

Your next question comes from the line of Mark Palmer from BTIG.

[Mark Palmer, BTIG]

Last year, at this time, you had given some helpful guidance with regard to the percentage of the company's annual revenue guidance that was already in the woods, so to speak, in terms of signed contracts. It was, I believe, 99% at that point. Can you provide a comparable statistic for this year in terms of where you are in that regard?

[Scott Behrens, Executive VP, CFO and CAO]

Yes. Good question, Mark. I mean if we look back at last year, we had so much of our revenue and EBITDA because a lot of it was all license fee that was back-end loaded. It was all sitting in the fourth quarter. And so the reason we put out that statistic was really to provide comfort that it was there and that it was under contract. We don't have a similar one for this quarter for this year. We had a lot more license revenue coming in Q1 and Q2. So we have a lot better phasing of that this year, but we're comfortable with the path we've got left in the rest of the year. We're comfortable with this revenue range.

[Mark Palmer, BTIG]

And just one follow-up question with regard to the inflation impact on the Biller segment and the actions that you've been taking to mitigate that. And so, first, you said 1/3 of the impact of that has already been addressed. Was that reflected in the third quarter results? Or is that something the 1/3 is going to be reflected to a greater extent in the fourth quarter?

[Odilon Almeida, President, CEO and Director]

Part of it was in the third, part of it is going to be in the fourth. And you can expect that the benefit is going to grow with the time because the more actions that we generate, for example, when you go to a big complex, we are able to readjust, at the mix, we adjust the price for consumers. That impact you have the whole effect of that going forward every month. So the more that we do, the more it accumulates. So you should expect that it is accumulating month after month, but we already have part of that impact in Q3.

[Mark Palmer, BTIG]

Very good. And just one more question with regard to the Biller segment. Of course, you're processing utility payments, other types of consumer payments. Has there been any indication of any credit-related issues among those for whom you are processing payments that could potentially impact volumes?

[Scott Behrens, Executive VP, CFO and CAO]

When you say credit, are you saying credit issues? We haven't seen any.

[Mark Palmer, BTIG]

Meaning repayments. Payments of utility bills, things of that nature with higher inflation and economic challenges we are hearing about folks who are struggling to pay their bills.

[Scott Behrens, Executive VP, CFO and CAO]

No. And we don't see what -- we get obviously as we get the payments that go through, not the ones that aren't -- we're not seeing it necessarily in volumes, no. And we're in areas if you look at it like utilities, government payments, consumer finance, and we're not seeing it really in any volume trends that would indicate trouble within that consumers.

[Odilon Almeida, President, CEO and Director]

Yes. Just to add some color about that. Next year, as you know, I mean we're going to have the fair now and we're going to launch the request for paying with dealers with real-time payments as soon as it's available. Probably, we're talking about by the end of Q2. When that happens, we are talking to our Billers and we're going to push that payment method significantly, as you can expect, has a very low interchange rate, that amount of payment. And we can even link to that our by now feature, what we have like 70 companies linked to that already in the merchant business. We can use that also in the due payment business, to help consumers pay if recession comes or something comes.

So I look at what we are doing today the real-time linked to Billers into this huge bill that we have every year of interchange, and I see a lot of opportunity. We could say that interchange is the problem today. I really see it as an opportunity of education in the next years.

[Operator]

Your next question comes from the line of George Sutton from Craig-Hallum Capital.

[George Sutton, Craig-Hallum Capital]

First, Scott, just a clarifying question. You mentioned that you felt merchant volumes were picking up currently. And I just want to make sure that is obviously seasonally that happens, but we're -- I'm just curious if that's a year-over-year statement that would be quite a bit different than some others like Amazon is. So curious if that's what you mean?

[Scott Behrens, Executive VP, CFO and CAO]

Yes. Our volumes are picking up year-over-year. So if you look at our year-over-year growth Q3 over Q3 last year compared to Q2, and we think that will uptick again here in Q4.

[Odilon Almeida, President, CEO and Director]

It's very also geographic basis, right, Scott? I mean...

[Scott Behrens, Executive VP, CFO and CAO]

And ours is predominantly e-com versus say in store and things like that. So it's our trend is showing a pickup in Q3 year-over-year.

[George Sutton, Craig-Hallum Capital]

Understand. Okay. And Odilon, just a curiosity, you called out a nice set of new RTP customers. It sounds like both some infrastructure and some connectivity. I'm wondering if you could break your success with those customers into those two pieces? And then as we're looking out to '23 for the NextGen platform, can you just talk about how that's influencing your sale cycles today given the length of sales cycles? Is that being used fairly aggressively in your sales cycles, that NextGen functionality?

[Odilon Almeida, President, CEO and Director]

Yes. No, George, that's a great question. So starting with the last point. When you talk about real-time payments, this next generation that we expect for -- in the first half of next year to be available for U.S. We are going to be launching it very strong -- we're already talking to clients, but we're going to be launching it in the media with clients in the first quarter of next year.

And we are going to be really announcing details of this during our Investor Day, that's probably is going to happen in Q1 next year, right, John? And so we would expect -- there's a lot of excitement within the clients of U.S. today about that. We have talked with the most important ones already and some new logos. So I expect a lot of demand on that -- on our offering.

Basically, the way it works is we -- the deals that we're going to sign, it takes around 6 to 9 months to launch. In this case -- so we are talking about revenue really in 2024. But yes, the idea is we would be able to impact 2024 already with this new technology.

[George Sutton, Craig-Hallum Capital]

And any sense on these real-time payment deals you announced relative to like the Qatar, it sounded to me like an infrastructure deal and some of the others sounded potentially more like connectivity. Is that [Indiscernible]

[Odilon Almeida, President, CEO and Director]

Yes. Those are license deals. So you already saw the revenue impact because most of them are licensed deals, right?

[Operator]

[Operator Instructions] Your next question comes from the line of Charles Nabhan from Stephens Inc.

[Charles Nabhan, Stephens Inc]

I know it's one of your larger verticals, but could you comment on how large utilities is as a percentage of bill pay? And secondly, in the past, you had alluded to higher education and consumer finances couple of your growth verticals. And I was wondering if you could dive into that a little further and think of some of the traction you're getting in those two areas?

[Scott Behrens, Executive VP, CFO and CAO]

Yes. Utilities is about 30% of the Biller business. And going back to say, higher education, we're getting pretty decent traction there, pretty good actually double-digit transaction growth year-over-year in the higher education space. And then, obviously, government is a big segment for us, and that is -- that's seeing pretty good growth, maybe call it mid-single-digit growth over last year.

[Charles Nabhan, Stephens Inc]

Got it. And just as a follow-up, some of your peers in the bank technology space had alluded to elongated sales cycles in Europe and just pauses and decision-making. And I wanted to see if you're seeing anything along those lines?

And then secondly, if we could bring it back to domestic as we think about the NextGen platform for next year. It sounds like then that will enable you to go a little down market within the bank space. So I was hoping you could comment on those two areas in terms of what you're seeing and what your expectations are?

[Odilon Almeida, President, CEO and Director]

Definitely. When you talk about that agitation, I would say we don't see that much because we are in the center of this modernization with banks and finance institutions. But definitely, it's different by geography. So yes, Europe is different than the rest of the world in that case. It feels like Europe is suffering a little bit more than the rest. But we see like Asia flying, Africa doing quite well. Latin America doing quite well. We don't see it in the United States. So it's more like an Europe phenomenon, not that strong for us. But definitely, we can see that Europe is reacting differently than the rest of the world.

When you talk about this new platform, I think you got it very right. This is also the possibility of us to going a little bit down to other -- to Tier 2 and Tier 3 banks in the United States, which is a market that we don't cover today with the real-time payment platform in this new technology. So it is refreshing for our clients, and we are talking about Tier 1, when we are ready to discuss in detail that acknowledge with them in their modernization journey, probably they are going to go hybrid in the future with that technology. But for this Tier 2 and Tier 3 and fintech companies in United States, it's a real -- it's a new market for us and a market that we can expand on.

[Charles Nabhan, Stephens Inc]

Got it. And if I could sneak in one final follow-up. On the cost side, I know it's not necessarily a new dynamic, but could you speak to what you're seeing from a labor cost or a vendor cost inflation standpoint and as well as your ability to offset higher costs by reducing discretionary cost -- discretionary spend or any other flexibility you might have in your cost base?

[Odilon Almeida, President, CEO and Director]

Yes. I'm going to summarize and then Scott will give the detail, but I -- we are very investor friendly, and we can manage inflation and we are managing inflation. It's not that we don't have inflationary pressures in every line, but we have been able to manage every line with the exception of the interchange in this case, that is -- that takes time. So I feel confident that we can continue to manage inflation in every other line. Interchange will take more time. Scott?

[Scott Behrens, Executive VP, CFO and CAO]

Yes, it's a good question. I mean from a -- if you look at it, we're in a soft -- pure software and SaaS provider, we don't have all those impacts of those supply chain type inflationary pressures in terms of input costs. So we really don't see it. On the supply chain we're not a heavy user of energy. Obviously, we're seeing -- we're indirectly impacted by the utility segment that we have in the Biller business. So we don't really have a burden there in terms of energy consumption, and we aren't seeing a lot of real broad-based wage pressure in the markets that we're in around the world. So the inflationary impact, when we say it's isolated, it's pretty isolated to this Biller or Utility segment. And everything else is pretty manageable.

[Operator]

There are no further questions at this time. I would like to turn the call back over to the presenters.

[John Kraft, Senior Vice President of Finance and Strategy]

Well, thank you, everybody, for dialing in and your questions. We look forward to following up in the coming weeks. Have a great day.

[Odilon Almeida, President, CEO and Director]

And we are fine with the fire alarm.

[Operator]

This concludes today's conference call. You may now disconnect.