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new Ebix CFO and debt profile ?4

20:40 08-Apr-20


Ebix has hired its (former) lead banker from Regions Financial to become its new "global" CFO, starting Monday.  After about 6 months in the role, the current CFO will remain with the company, overseeing SEC reporting, planning and analysis. 

Hopefully this signals the end of the problems we saw in prior earnings calls, and not the beginning of new financial ones.  Clearer progress on the EbixCash IPO is needed.  However, that is almost certainly going to be delayed beyond the original projections for this quarter, perhaps by a year or more.  In my commentary on the year-end report, I said that the stock was pricing in some IPO delay, but with last year's operating income around $160M, this table from the 10-K shows the time pressure: 
 
 
Payment Due by Period
 
 
Total
 
Less Than
1 Year
 
1 - 3 Years
 
3 - 5 Years
 
More than
5 years
 
 
(In thousands)
Revolving line of credit
 
$
438,037

 
$
—

 
$
—

 
$
438,037

 
$
—

Short and long-term debt
 
279,111

 
23,650

 
50,836

 
204,625

 
—

Operating leases
 
22,432

 
7,289

 
9,061

 
4,491

 
1,591

Capital leases
 
727

 
201

 
350

 
176

 
—

Non-Cancelable Operating leases
 
97,774

 
27,496

 
48,544

 
21,734

 
—

Total
 
$
838,081

 
$
58,636

 
$
108,791

 
$
669,063

 
$
1,591


I also remain very concerned about the company's exposure to travel and India, even though the official COVID-19 case count there is still just under 6K, with 178 deaths.  The next quarterly report is still a month off, but I'm not sure that will be enough to fully assess the situation.  Many Indians fled the cities before the lock-down, which could lead to a temporary rise in 1Q20 travel, but the country's situation still makes Ebix acquisitions over the past year now seem very poorly timed.  I've pointed out that shares are cheap, but never called them safe.  As they bounce I have to also warn that the combination of virus and debt could become financially deadly over time.