Business Context and Reporting Period
This Form 6-K filing by Globant S.A. (the "Company") is dated August 11, 2016. The primary purpose of the report is to announce the Company's listing and admission to trading on the Luxembourg Stock Exchange. On August 2, 2016, the Company applied to list 34,594,324 existing common shares, representing its entire share capital. The Luxembourg Financial Sector Supervisory Authority (CSSF) approved the listing prospectus on August 11, 2016, with trading expected to commence on or about August 12, 2016.
Key Financial Metrics
The filing provides capitalization and indebtedness data as of June 30, 2016. The document does not contain revenue, profit, or cash flow statements for a specific reporting period, as it focuses on capital structure and listing details.
| Metric | Value (in thousands USD) |
|---|---|
| Total Current Liabilities | 45,023 |
| Total Non-Current Liabilities | 25,679 |
| Shareholder's Equity | 97,315 |
| Cash and Cash Equivalents | 18,765 |
| Current Financial Receivables | 105,128 |
| Net Current Financial Indebtedness | 117,189 |
| Net Financial Indebtedness | 117,099 |
| Issued Share Capital | 41,300 |
Note: The filing lists "Net Current Financial Indebtedness" as a positive value of 117,189, derived from the calculation (Current Financial Debt) - (Current Financial Receivables) - (Liquidity). Given the magnitude of receivables (105,128) versus debt (6,704), this positive figure likely represents a net financial asset position or a specific non-GAAP presentation of net working capital related to finance, rather than traditional indebtedness.
Material Changes and Updates
- Listing Status: The Company transitioned from a private entity to a public company listed on the Luxembourg Stock Exchange.
- Capital Structure: The Company has 34,594,324 issued common shares with a nominal value of $1.20 each. There are 143,593 treasury shares held by the Company.
- Argentina Risk Factors: The filing updates risk factors regarding Argentina, including a state of emergency declared by the government regarding the electrical system until December 31, 2017, and changes to electricity and natural gas tariffs/subsidies.
- Argentina Debt Litigation: The filing details the resolution of the "pari passu" injunctions. Argentina issued $16.5 billion in new debt and applied $9.3 billion to settle claims with bondholders. While injunctions were vacated in April 2016, litigation with certain holdout bondholders continues, which could impact the Argentine government's ability to implement reforms and potentially affect the Company's access to international credit markets.
Guidance, Outlook, and Risks
The filing does not provide specific financial guidance or revenue outlook for future periods. However, it highlights several material risks and contingencies:
- Regulatory and Political Risk (Argentina): Continued uncertainty regarding the Argentine government's ability to implement economic reforms due to ongoing litigation with holdout bondholders. This could indirectly impact the Company's operations and financing capabilities.
- Lock-up Provisions: 96,924 common shares are subject to one-year contractual lock-up provisions following recent acquisitions (We Are London Limited, We Are Experience, Inc., and Clarice Technologies Private Ltd).
- Corporate Governance: Upon listing, the Company must comply with the 10 Principles of Corporate Governance of the Luxembourg Stock Exchange under a "comply or explain" standard.
- Takeover Provisions: Under Luxembourg law, acquiring 33 1/3% of voting rights triggers a mandatory offer obligation. Squeeze-out rights exist if an offeror holds 95% of voting rights, and sell-out rights exist for minority holders if an offeror holds more than 90%.
Investor Verification Checklist
- Trading Commencement: Verify the actual start date of trading on the Luxembourg Stock Exchange (expected August 12, 2016).
- Argentina Exposure: Assess the specific impact of the Argentine state of emergency and ongoing bondholder litigation on the Company's operations in Argentina, which houses the majority of its employees (2,806 of 5,380).
- Financial Position: Clarify the calculation methodology for "Net Current Financial Indebtedness" given the high level of financial receivables relative to debt.
- Major Shareholders: Review the concentration of ownership, noting that WPP Luxembourg Gamma Three S.à r.l. holds 19.33% and Ivy Investment Management Company holds 8.17%.
- Equity Dilution: Monitor the vesting schedule of the 2,060,613 outstanding stock options as of June 30, 2016.