Emerald Holding Inc

NYSE:EEX

Earnings Call Analysis

Solid Performance and Positive Outlook with Reintroduced Dividends

For Q2 2024, Emerald reported $86 million in revenue, similar to last year's $86.5 million. Adjusted EBITDA rose 4.8% to $15.3 million. Despite slight scheduling adjustments, organic revenue grew by 3.3%. The company reintroduced a quarterly dividend of $0.015 per share, equating to an annual $12 million payout. Emerald maintains guidance of $415-$425 million in revenue and $110-$115 million in adjusted EBITDA for the year, with expectations of mid- to high-single-digit organic growth.

Navigating a Seasonal Quarter

Emerald Holding, Inc. reported total revenue of $86 million in the second quarter of 2024, a slight decrease from $86.5 million a year ago. This dip is attributed to scheduling adjustments in their event calendar, along with the discontinuation of several small, unprofitable events aimed at optimizing their portfolio. However, organic revenue experienced a positive shift, rising 3.3% to $82.1 million, driven by an increase in certain events reflecting growth in specific sectors. It's important for investors to note that quarterly performance can fluctuate due to the timing and mix of events, thus a broader annual view is recommended.

Stable Profitability Despite Challenges

The company achieved an adjusted EBITDA of $15.3 million, marking a 4.8% increase from the previous year. This resulted in an adjusted EBITDA margin of approximately 17.8%, which is expected given the seasonal variance in revenue streams. Moreover, free cash flow improved significantly to $7.1 million compared to $4.6 million in the same quarter the previous year. The results reflect Emerald’s commitment to enhancing profitability while managing expenses effectively, with selling, general, and administrative expenses (SG&A) reduced to $39.5 million from $41.8 million due to efficiency initiatives.

Strategic Growth and Future Guidance

Emerald’s leadership underscored their longer-term growth strategy aiming for mid- to high single-digit organic growth annually, supplemented by acquisitions targeting double-digit revenue growth overall. For 2024, guidance maintains projected revenues between $415 million and $425 million, with adjusted EBITDA ranging from $110 million to $115 million—this translates to an anticipated adjusted EBITDA margin of around 27%. Additionally, the company expects a reacceleration of organic growth in the fourth quarter, indicating confidence in their event scheduling and portfolio mix.

Capital Return and Dividend Resumption

Emerald announced the reinitiation of a quarterly dividend at an initial rate of $0.015 per share, implying an annualized cash dividend of $12 million, which translates to a 1.3% yield based on recent stock prices. This marks a significant shift as Emerald previously suspended its dividend during the pandemic. The intention is to grow this dividend over time, targeting a payout ratio of up to 25% of free cash flow, which reflects the company's strong cash generation capabilities.

Optimizing the Event Portfolio

Emerald continues to enhance its portfolio optimization strategy through new event launches and potential acquisitions focused on industries with stable growth characteristics. The company anticipates that these new events will contribute an additional 1 to 2 percentage points of annual organic revenue growth. This is backed by a disciplined approach to evaluating new event concepts, with approximately a dozen ideas currently undergoing different phases of the review process.

Utilization of Technology for Growth

Investments in technology, particularly artificial intelligence (AI), are central to Emerald's growth strategy. The company is exploring AI applications to personalize marketing efforts effectively, improving customer engagement with tailored messages. This technological enhancement is expected to boost future conversion rates, further strengthening customer relationships and increasing revenue per customer.

Navigating Sector-Specific Trends

Emerald's B2B event portfolio operates across various sectors, and while certain areas like design are performing strongly with double-digit growth, more consumer-oriented sectors are lagging in recovery post-pandemic. This diversification allows the company to maintain a resilient performance overall, even amidst varying sector-specific trends. Management's insight into these industry dynamics positions Emerald strategically across market cycles.

Earnings Call Transcript 2024-Q2

[Operator]

Good morning, and welcome to the Emerald Holding, Inc. Second Quarter 2024 Earnings Conference Call. [Operator Instructions]

Before we begin, let me remind everyone that this call will include certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include remarks about future expectations, beliefs, estimates, plans and prospects. In particular, the company's statements about projected results for 2024 are forward-looking statements. Such statements are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from those indicated or implied by such statements. Such risks and other factors are set forth in the company's most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. The company does not undertake any duty to update such forward-looking statements.

Additionally, during today's call, management will discuss non-GAAP measures which it believes can be useful in evaluating the company's performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with U.S. GAAP. The reconciliation of these non-GAAP measures to the most comparable GAAP measure can be found in the company's earnings release.

As a reminder, this conference is being recorded. And a replay of this call will be available on the Investors section of the company's website through 11:59 p.m. Eastern Time on August 14.

I would now like to turn the call over to Mr. Herve Sedky, President and Chief Executive Officer. Sir, please go ahead.

[Herve Sedky, executive]

Thank you, Julie, and good morning, everyone. It's great to be with all of you today to discuss our second quarter results. I'll start with a brief overview -- or a review of our performance and then give an overview of our strategy. David Doft, our CFO, will then provide more detail on our financials.

We had a positive performance in what is a seasonally smaller quarter due to the relatively less significant show schedule, which combined with our Q1 performance and expectations for the second half, set us up for another full year of strong revenue and EBITDA growth. These trends reflect the exceptional value and ROI we provide our customers for their marketing budgets.

For many businesses, trade shows are their #1 selling or marketing event of the year. Our goal has been to underscore this value proposition and make the ROI more transparent by developing value-added tools and metrics that we believe will deliver an even better trade show experience. The results is that our customers view our shows as an investment rather than a cost.

We plan to continue to maximize value for our customers and shareholders, fostering an intense sense of loyalty. Our customers' commitment to us is reflected in their continued and consistent desire to return to our shows each year as well as their increasing engagements in between event conditions throughout the year. The evidence is clear. Our trade shows have a profound impact.

At all of our trade shows, we've implemented on-site prebooking, which means we have been selling exhibitor space into the first half of 2025 for some time and just begun selling into H2 2025. Our sales pacing data offers us a highly granular view into exhibitor trends up to a year out, which gives us confidence in our forecasts for 2024 and for continued growth into 2025. Looking ahead, we project continued increases in revenue above our industry's historical run rate.

Overall, as the reaffirmation of our original guidance indicates, we expect another meaningful step forward in both revenue and profitability this year. Our longer-term plan is to deliver run rate organic growth in the mid- to high single digits combined with growth from acquisitions to drive double-digit annual revenue growth overall.

Our strategy continues to be informed and inspired by the three pillars of our value creation: Customer centricity, 365-day engagement and portfolio optimization.

In customer centricity, we are focused on improving the customer experience and delivering greater value in the form of add-on services, actionable data and insights and a clear picture of the return on investiture -- on investments customers receive from the marketing dollars they put to work across Emerald's platform. This improves our stickiness with customers, incentivizes them to deploy more marketing dollars with Emerald and ultimately should help drive higher revenue per customer.

In the end, we provide a unique experience that is both financially and personally rewarding. Our customers walk away from our trade shows feeling reenergized by their future prospects and inspired by the innovations they discovered.

In 365-day engagements, we are providing multiple entry points to the customer engagement cycle through trade shows, conferences, webinars, media content and commerce. This reinforces our brands in their respective markets, increasing their reach and driving down the acquisition cost of attendees to our events. This is where we're seeing the most opportunities to scale by leveraging artificial intelligence, where we have numerous tests across our content and marketing teams.

We're excited about some of the early results and expect to fully implement it in certain areas of the business in 2025. For example, by leveraging our proprietary first-party data assets, we can better personalize messages to our readers and prospective attendees. AI can help scale these personalization efforts quickly and efficiently, which we expect will improve conversion rates in the future.

And in portfolio optimization, through our acquisitions and new event launches, we have targeted industries with strong, stable growth rates in order to continue to improve Emerald's growth profile overall. We're always evaluating potential attractive acquisition opportunities, and this is an important part of our growth strategy. Over time, we expect new event launches to contribute 1 to 2 percentage points of annual organic revenue growth.

Through our value-added efforts and investments across our Connections, Content and Commerce businesses, we're positioning Emerald to be a reliable free cash flow generator and earnings compounder with attractive growth characteristics built in. Our modest level of financial leverage, combined with the visibility and expected stability of free cash generation, allows us to have a capital allocation strategy focused on driving per share value to our shareholders and includes stepped-up return of capital by reinitiating Emerald's common stock dividend that was suspended during the pandemic, as David will elaborate.

Also central to our strategy is the belief that the personal experience of our customers is paramount. By always putting people first, we ensure our initiatives resonate deeply and create lasting value. We are confident that we can sustain this trajectory and deliver growth in excess of our industry while enhancing our profitability year after year.

And with that, let me turn the call over to David.

[David Doft, executive]

Thank you, Herve, and good morning. I'll continue with the financial overview of the most recent quarter and then discuss our dividend initiation and guidance.

For the second quarter, total revenue was $86 million compared to $86.5 million in the prior year quarter. The very slight decrease was primarily driven by scheduling adjustments where events staged in different quarters this year versus last year on our show calendar; and several small, unprofitable, discontinued events as we look to optimize resource allocation and profitability of the Emerald portfolio. Organic revenue, which takes into account the impact of acquisitions, scheduling adjustments and discontinued events, was $82.1 million for the second quarter 2024, an increase of $2.6 million or 3.3% versus the prior year period.

As we've discussed, we have a broad portfolio of shows, some of which are experiencing faster growth rates than others as a function of where their industries are in the business cycle as well as other factors. Therefore, any one quarter's organic growth rate is not necessarily indicative of the growth in the overall portfolio, and we would encourage you to look at our business on a full year basis.

Second quarter adjusted EBITDA, excluding insurance proceeds, grew approximately 4.8% to $15.3 million compared to $14.6 million for the same quarter last year. This equates to an adjusted EBITDA margin of approximately 17.8% for the quarter, given our seasonally lower revenue against the fixed component of our cost base. Second quarter free cash flow was $7.1 million compared to $4.6 million in the prior year quarter.

Turning to expenses. In the second quarter, SG&A was $39.5 million versus $41.8 million in the prior year quarter. The year-over-year decrease in SG&A is largely due to ongoing efficiency initiatives as well as the benefit of a $1.7 million increase in remeasurement of estimated contingent consideration for past acquisitions, offset by incremental SG&A from the Hotel Interactive acquisition that closed in January of this year.

Given the number of the industries Emerald serves, our guidance has always assumed some variability in quarter-to-quarter organic growth rates. As we discussed in our last earnings call, while Q1 contributed strong double-digit organic revenue growth, other quarters, including Q2 and Q3, were not expected to reach that level based on the mix of business in each specific period, with Q4 growth expected to reaccelerate, all consistent with the assumptions that underpin our annual guidance.

Turning to the balance sheet. We had $193.2 million in cash as of June 30, 2024, versus $186.8 million as of March 31. As a reminder, in early May, we completed the conversion of our convertible preferred stock, eliminating the preferred dividend and resulting in a simpler all common equity structure.

Our total liquidity is $303.2 million, including full availability on our $110 million credit facility. As of June 30, we had net debt of $218 million, leading to a net leverage ratio as defined in our credit agreement of 2.10x our trailing 12-month consolidated EBITDA, based on the definition in our credit agreement of $104.0 million.

We believe our balance sheet strength and cash flow generation support our ability to opportunistically invest in and grow our business as well as optimize the per share value of our stock. On that note, we are pleased to announce that our Board of Directors has authorized the reinitiation of a regular quarterly dividend at an initial rate of $0.015 per share, which would imply an annualized cash dividend amount of $12 million, reflecting a dividend yield of 1.3% based on yesterday's closing price.

Prior to COVID, Emerald was historically a dividend payer. And given our strong cash generation, coupled with our organic and inorganic growth, it is our intention to grow the quarterly dividend over time with a target payout ratio of up to 25% of free cash flow.

As Herve said, we believe the visibility and expected stability of the company's free cash generation position positions us to return capital to shareholders on an ongoing basis. This quarter, we added a slide to our earnings presentation deck outlining our capital allocation and financial policy that we've discussed over the past several quarters.

We expect to continue to balance capital allocation between acquisitions; investments in our own business; managing debt leverage below 3.0x net debt to EBITDA; and returns on capital, which includes dividends and opportunistic share buybacks. At quarter end, we had $23 million remaining on our existing buyback authorization after not buying back any shares in the second quarter.

Turning to guidance. We continue to expect that our 2024 performance will be within our full year guidance in the range of $415 million to $425 million of revenue and $110 million to $115 million of adjusted EBITDA. This guidance implies an adjusted EBITDA margin of approximately 27%. We believe, as our business continues to scale and we leverage the investments we have made, that we have runway to improve this number as we work our way back over time to the margins we saw prior to COVID.

Thank you very much for your time. And with that, we'll now open the line for questions.

[Operator]

[Operator Instructions] Your first question comes from Barton Crockett from Rosenblatt Securities.

[Barton Crockett, analyst]

David, I was wondering if you could talk a little bit more in terms of your quarterly kind of cadence here. If you could give us a little bit more kind of detail around what drives the slower growth for the next quarter and then the speed up in the fourth quarter. Just give us a little -- unpack that a little bit more, give us a little bit more kind of sense of what's underneath that. That's one question.

And then for either you or for Herve, obviously, we're in an interesting kind of macro -- broader macro environment. You guys have a lot of sense, obviously, from the range of verticals that you deal with and the pre-bookings, of what people might be feeling. I was just wondering if you could talk about just what you're seeing in terms of pressure points, some industries that are maybe a little bit feeling a little bit of pressure, or industries that are still feeling healthy. And just your broad sense of kind of how the macro is impacting your clients.

[Herve Sedky, executive]

Why don't I start with that and then pass it on to David. Barton, thank you very much for the question. One of the benefits of the Emerald portfolio is that we in fact have this highly diversified portfolio of B2B events. And the events themselves have this leadership position in and across the broad range of verticals.

And so for us, while clearly, there are different parts of -- and different ranges of performance across the industries that they serve, as David mentioned in his prepared remarks, we are seeing different events and different verticals perform at different rates. The -- and the example that I'll use is the sectors that are more consumer-oriented haven't recovered as well since the pandemic as some of the other sectors for sure.

The design sector for us is a big sector and has been growing at double digits and has been doing extraordinarily well while some of the consumer-oriented sectors has just not rebounded as nicely. So -- and another example would be some of the tech marketing spend that got impacted, for instance, last year. While it has seen a bounce back, has not bounced -- is not fully bounced back.

So we're definitely seeing a different performance in different sectors. But on the whole, the beauty of the portfolio is that it's a highly diversified portfolio. And because the events have leadership positions in their respective sectors, that's what positions Emerald to do well on the whole.

And now I'll turn it over to David to maybe add more to that and then also to address the second question.

[David Doft, executive]

Yes. I mean, that really leads into your first question around the cadence of the quarter-to-quarter growth rates. It depends which shows are staging when in the calendar year. So when we look at overall performance in our full year guidance, and as you know, we don't guide quarters, it's because of this mix overall. And so we're able to reiterate our full year guidance that we gave at the beginning of the year because of that continued visibility in the performance of the entire portfolio irrespective of where in the year those events stage.

And so Herve's point is a really good one. There are some sectors that are growing very strong double digits, and there are others that are not. And the mix is that we fall somewhere in between as a portfolio.

And so it's because of the timing of those shows that we're able to make a statement that 4Q should show reacceleration of organic growth. It's not making a macro call on the broader trade show business. It's making -- taking a view of the specific industries we serve within each quarter that drives that performance overall.

The other thing I'd add is we -- Herve talked about our three growth pillars, and we talk about them every call. And one of them is a really important one, it's called portfolio optimization. And we use that word optimization very specifically because not only are we looking to acquire incremental events and not only are looking to launch incremental events, but we're looking to do so within industries that enhance the growth profile of the Emerald portfolio.

We're looking to continue to tilt our portfolio to a better and better place in terms of its mix so that we can continue to drive growth overall for the business. And there's lots of opportunity to do that. And we've done a lot in the last few years with some of the work we've done, but there's a lot more that we can do if we're successful in that strategy.

And that's why we continue to have a launch machine here in our accelerator group. That's why we continue to actively look at M&A opportunities because it behooves us to continue to look for more and more opportunity to improve the mix of the business because there's never a perfection there.

[Barton Crockett, analyst]

Okay. All right. If I could just follow up. I was wondering if -- certainly, I think the growth trajectories in the back half are probably influenced by the leading trade shows that you have in each of the quarters. I was wondering if you could tell us what are kind of be the important trade shows in the third quarter and in the fourth quarter?

And then if you have any kind of metrics you can use to kind of expand upon what you're seeing in terms of square footage booking or rates paid per booking or number of exhibitors booking. If there's any metrics you can give us to give us a sense of what's under Herve's -- kind of your outlook here.

[David Doft, executive]

So our trade show calendar is on our website. All of the events are listed there with their dates. I think it's pretty -- if you take a look, I think it's pretty easy to see which shows are where. We -- given the segment reporting, we try not to name individual events on our earnings calls. But it's really there in the data that we publish online for you to see.

In terms of metrics, we don't publish the exact details of those metrics. I think we have talked quite a bit about our work on the pricing front, and we continue to see strong yield improvements year-over-year, surely mid-single digit or better, across the portfolio of the events.

This year, because the tailwind of post-pandemic world gets smaller and smaller as we've moved to 2 or 3 years out from the pandemic, the NSF growth is slower than it has been last year. But that's as we expected because we're settling back into kind of the normalcy of the trade show business.

[Operator]

Your next question comes from Allen Klee from Maxim Group.

[Allen Klee, analyst]

I just mentioned that there's another company I cover and I was talking to the CEO the other day. And he's basically telling me the main reason why he's confident in his revenue improvement was two potential customers he signed up from a trade show. So I think it kind of corroborates a lot of what you guys say.

So to start off with, I wanted to just follow up on something Barton said and something that you guys said during your -- describing the quarter. And you mentioned that one of the impacts in the quarter was some scheduling changes of some conferences. So the question I had is, if some things were moved, like where were they moved to? Which quarter -- or what type of new events would we expect to see in new quarters that weren't there last time?

[David Doft, executive]

So every year, there are events that in 1 year might have been in March and the next year they're in April, or they might have been in June, and they're in July. The timing could shift a couple of weeks in the calendar, and it shifts it out of -- in and out of quarters.

[Herve Sedky, executive]

Or sometimes 1 day, the shift in the quarter...

[David Doft, executive]

Or 1 day, yes. exactly. So it really has to do with that. The -- so there were a half a dozen or so events that moved between quarters this year for the second quarter that -- probably the main one was one of the Overland expos that we run, which moved from Q2 -- Q3 last year into Q2. But then there was a number of things that moved out of Q2, that were in Q2 last year, some of our hosted buyer events, some of the smaller type events. But in aggregate, it all adds up.

So in our reconciliation of organic growth, you could see the dollar impact of those shows in each of the quarters, whether it impacted the base from last year or it impacted this year based on the movement. So you can make those calculations.

[Allen Klee, analyst]

In the past, you said that one of the opportunities that we've had was growing your international. Can you talk about what you're doing there and how you think about that now?

[Herve Sedky, executive]

Yes, of course. So what we have done over the course of the last 18 months is really invested in creating an international sales division. And we've resourced that by putting a head of and resourced it with a number of sales leaders underneath that are geographically focused.

So we have leadership that is assigned to different territories around the world. While they're U.S.-based, they are -- they own different territories and work with different representatives, whether they're agents or counselor offices or representatives, government representatives around the world, to do a couple of things.

One, sign agents so that these agents can help put feet on the street and bring businesses -- import businesses into the U.S., help us really drive international business into the U.S. But also allow us to tap funds, some governments, international government sponsorship funds, that some governments have to encourage their companies to really grow and to access the U.S. market. And so this new group is in fact helping access these funds and attract these companies to the U.S.

So while it's a fairly new group for us, they've had some good success in the short time that we've had them up and running. And that team is about half a dozen strong now. And yes, we're very pleased. It's an area where Emerald was underweight relative to peers, and we're looking forward to continuing to strengthen that.

[Allen Klee, analyst]

Great. In your remarks, you guys talked about some testing you're doing with AI and to better personalize them and then improve some of the metrics. Could you just go into that a little bit more?

[Herve Sedky, executive]

Yes, of course. So we have a number of tests. And like I'm sure many, if not all, companies are testing different ways to leverage technology. So we're leveraging off-the-shelf technology, AI technology, in order for us to really be more effective and efficient.

And so -- and it's largely around, as I mentioned in my opening remarks, around our content business and marketing. So it's really how do we write copy more effectively and efficiently? How do we allow this copy to be more personalized? And the whole concept is to be more effective and efficient so that we can personalize the messaging so that we can attract more people to attend our events in a more efficient and an effective way. That's, in a nutshell, what we're trying to do.

[David Doft, executive]

So that's one example. There's a number of other areas. Some areas, we've not been successful in finding use cases, as when you test, not everything works. But -- and there are a few areas where there is some real opportunity, and this is one of them.

And when you talk about the promise of our proprietary data that we generate here at Emerald, one of the benefits is we can better attract leads for our customers. But the other benefit is we could better attract leads for Emerald. And that's what this is about, which has some nice long-term implications for us.

[Allen Klee, analyst]

Just last quarter, you talked about your acquisition of Hotel. And I was just wondering if you could give an update on how that looks, Hotel Interactive. And just a reminder of when they're having their events and what they're called, the names of their events.

[David Doft, executive]

Sure. So Hotel Interactive is a series of events that are called hosted buyer events. We've talked about these from time to time. They are smaller events where we invite a small group of in-market executives that have budget authority, buying authority, to a resort location for a couple of days.

We pay for them to come. That's why it's called hosted buyer because we host them. And it's funded by sponsors who want to get in front of them with their products and services. And so we build a conference schedule that's of interest to the attendees, to learn best practices, to hear from their peers on case studies. And then in exchange for us paying for them to come to this conference, they have to do a number of short meetings with suppliers to learn about their products and services.

And the reality is it's amongst the highest-ROI products that we offer. Our sponsors love these because it is in-market buyers that we're bringing in. It's part of the vetting process that we go through in recruiting attendees to the event. And so it's a very high return on their investment. We have phenomenal NPS scores at these events.

And Emerald already runs a bunch of events like this through a business that was acquired in 2018 called CPMG, Connected Point Marketing Group. And it's gone so well for us that we were looking to expand our footprint in this area, and so we acquired Hotel Interactive.

They run about 15 events a year that are evenly spread throughout the year, most of them under the BITAC, B-I-T-A-C brand name. And a lot of hospitality-related and design-related type events, which as Herve mentioned, has been a really strong organic growth category for us.

[Allen Klee, analyst]

Any updates in the Commerce area?

[David Doft, executive]

The Commerce area continues to progress. Per our strategy, the underlying subscription software business at Elastic continues to perform well, continues to drive its product road map that's leading to a strong pipeline, extension into new industries. As we've mentioned before, we've broken into the kitchen and bath category that we're very excited about, and we think increases the growth opportunity for that sector in the coming quarters. So we're very excited about that.

The other side of Commerce is the Bulletin platform. This week is actually a big week for them. Because Bulletin, the first brand that it integrated into was New York NOW, and the New York NOW event is going on as we speak. And Herve and I were there on Monday. And with tremendous amount of activity around the incubator section, which was driven by a lot of the original brands from Bulletin, but also is -- has a kind of a demo area for buyers and vendors of the platform to continue to drive traction of that.

But for this show, it is integrated into the event website. So the site is Commerce-enabled for approved buyers and transactions are taking place. And it's been an exciting week for us.

[Allen Klee, analyst]

That's great. My last question would be just how do you think about the pipeline or opportunity for new trade shows that -- in your accelerator that you create yourself and then also on the M&A side?

[Herve Sedky, executive]

Both have good, strong pipeline. We -- as you know, on the accelerator side, we have a very disciplined process that we use with a 3-gate review process. And we have a number of candidates that are going through. I'm looking it up as we speak here. I think it's about a dozen different concepts that are going through the different gates for -- in accelerator. In gate 1, I think, yes, it's about 12 to 15 different ideas that are in the very initial phases of review.

And there are 3 or 4 in the more advanced phases. That means that they've gone through the initial vetting and now in more advanced research and going through the next steps of putting budgets together and formal business cases and final approvals to launch. And so those, hopefully, you'll be hearing more about in the short term.

As it relates to M&A, we have a good, strong pipeline. I would say they're a mix of small to midsized assets. And it's a growing pipeline, and we continue to pursue those aggressively and hope to announce transactions as we've committed because M&A is an important part of our portfolio optimization strategy, as David mentioned. We want to continue to diversify the portfolio, and we'll continue to do that through both launching and acquiring events.

[Allen Klee, analyst]

Okay. Great. Congrats on the quarter, initiating a dividend and reiterating your guidance. That seems -- I like what I'm hearing.

[Herve Sedky, executive]

Thank you so much, Allen.

[Operator]

And there are no further questions at this time. I will turn the call back over to Herve for closing remarks.

[Herve Sedky, executive]

Well, thank you very much. In closing, over the last few years, as you -- many of you know, we've continued to optimize performance of the business, upgrading our go-to-market capabilities, driving best practices throughout the organization, optimizing the mix of the portfolio, as we've mentioned. And I believe that this has positioned us very well for sustained growth for the foreseeable future.

I want to thank you all for your participation today, and look forward to talking to you on the next call. Have a great day.

[Operator]

Ladies and gentlemen, this concludes today's conference call. You may now disconnect. Thank you.