Slide 1: Cover letter to stock exchanges
CYI l:NT • 21 January 2020 The BSE Limited The National Stock Exchange of India Ltd PJ Towers, 25th Floor, Exchange Plaza, Dalal Street Bandra-Kurla Complex, Sandra (E) Mumbai 400001. Mumbai-400 051. Scrip Code: 532175 Scrip Code: CYIENT Dear Sir, Sub: Investor Presentation - Reg. Please find enclos
Slide 2: Investor Presentation Q3 FY21
Investor PRESENTATION Q3 FY21 CYIENT © 2020 CONFIDENTIAL CYIENT © 2020 CONFIDENTIAL
Slide 3: Confidentiality Statement
Confidentiality Statement The information shared herein is strictly confidential, proprietary and unique to the company. It is only made and shared for the purpose and extent it is intended for and no other. Usage or sharing of the said information in any form, directly or indirectly and in any mann
Slide 4: Leadership team
Leadership team BVR MOHAN REDDY KRISHNA BODANAPU AJAY AGGARWAL KARTHIK NATARAJAN Executive Chairman MD & CEO President & CFO President & COO CYIENT © 2020 CONFIDENTIAL 3
Slide 5: Highlights, Financial Update, Business Update
Financial Business Highlights Update Update • Financial Highlights • Revenue • BU performance update • Business Highlights • Income statement update • New GTM organization • Performance linked ESOP • Margin bridge Structure scheme • Cash generation Annexures CYIENT © 2020 CONFIDENTIAL 4
Slide 6: Highlights, Financial Update, Business Update
Financial Business Highlights Update Update • Financial Highlights • Revenue • BU performance update • Business Highlights • Income statement update • New GTM organization • Performance linked ESOP • Margin bridge Structure scheme • Cash generation Annexures CYIENT © 2020 CONFIDENTIAL 5
Slide 7: Highlights for the Quarter (1/3)
Highlights for the Quarter (1/3) Revenue Financial Highlights for Quarter • Consolidated revenue at $141.4 Mn; growth of 4.1% QoQ (₹ terms) 4.7% QoQ (4.1% in CC) and de-growth of 8.9% 4.7% QoQ ($ terms) YoY Quarterly revenue at • Services revenue at $115.3 Mn; growth of 1.0% $141.4Mn/₹10,443Mn QoQ (
Slide 8: Highlights for the Quarter (2/3)
Highlights for the Quarter (2/3) Leadership position in Engineering and R&D Services in Zinnov ratings • Cyient has been placed in the top quadrant in the overall ER&D services category for the seventh consecutive year in the Zinnov Zones annual ratings • Within ER&D services, Cyient maintained its
Slide 9: Highlights for the Quarter (3/3)
Highlights for the Quarter (3/3) Signed an MoU with SaaS Provider Decipher to support the Global Rollout of Key Cloud Mining Platform • The platform will help streamline tailings and rehabilitation monitoring in the industry • Collaboration will enable global mining players to meet regulatory compli
Slide 10: Proposal: Performance linked ESOP Scheme
Proposal: Performance linked ESOP Scheme Objective • Opportunity for employees to participate in the long term value creation of the company • Alignment of employees and shareholder interests Scheme Details • Cyient Associate Stock Option Scheme 2021 Trust to acquire 2 million shares via secondary a
Slide 11: Highlights, Financial Update, Business Update
Financial Business Highlights Update Update • Financial Highlights • Revenue • BU performance update • Business Highlights • Income statement update • New GTM organization • Performance linked ESOP • Margin bridge Structure scheme • Cash generation Annexures CYIENT © 2020 CONFIDENTIAL 10
Slide 12: Revenue for Q3 FY21
Revenue for Q3 FY21 Revenue Q3 FY21 Q2 FY21 Q1 FY21 Q4 FY20 Q3 FY20 QoQ YoY Group $ Mn 141.4 135.0 130.6 149.2 155.2 4.7% -8.9% ₹ Mn 10,443 10,033 9,917 10,736 11,060 4.1% -5.6% Services $ Mn 115.3 114.1 112.2 132.3 140.1 1.0% -17.7% ₹ Mn 8,521 8,487 8,521 9,513 9,984 0.4% -14.6% DLM $ Mn 26.0 20.9
Slide 13: Income statement for Q3 FY21
Income statement for Q3 FY21 All Figures in ₹ Mn Q3 FY21 Q2 FY21 Q3 FY20 QoQ EBIT Movement Revenue 10,443 10,033 11,060 • Consolidated EBIT margin stood at 11.2%; up by 14 bps QoQ EBIT (Reported) 1,165 1,105 1,063 • In Q3, we rolled out wage hikes for individual PAT (Reported) 954 839 1,083 contribu
Slide 14: EBIT margin bridge for Q3 FY21
EBIT margin bridge for Q3 FY21 Particulars EBIT Q2 FY21 (Group) 11.0% Less DLM impact 116 bps EBIT Q2 FY21 (Services) 12.2% Tailwinds in Q3 FY21 Improvements in operational metrics 78 bps Lower restructuring cost 45 bps Volume impact and lower spend on SGA & depreciation 30 bps Headwinds in Q3 FY21
Slide 15: Cash Generation for Q3 FY21
Cash Generation for Q3 FY21 Q3 Q2 Q3 All Figures in ₹ Mn FY21 FY21 FY20 Services Profit before tax 1,109 1,103 1,403 (+/-) Non-cash & non-operating items 339 388 438 Cash Generation Operating profit before WC changes 1,448 1,492 1,841 (+/-) DSO Movement (Receivables) 586 1,223 581 • Cash and cash eq
Slide 16: Highlights, Financial Update, Business Update
Financial Business Highlights Update Update • Financial Highlights • Revenue • BU performance update • Business Highlights • Income statement update • New GTM organization • Performance linked ESOP • Margin bridge structure scheme • Cash generation Annexures CYIENT © 2020 CONFIDENTIAL 15
Slide 17: BU performance Q3 FY21
BU performance Q3 FY21 Services DLM Group Business Units $ Mn QoQ YoY $ Mn QoQ YoY $ Mn QoQ YoY A&D 29.2 -5.7% -35.3% 16.9 44.0% 88.1% 46.1 8.0% -14.8% Communications 34.1 5.2% -0.2% 0.1 -3.8% -66.8% 34.1 5.2% -0.6% E&U 14.9 13.9% -26.6% 1.9 43.7% -13.0% 16.9 16.7% -25.3% Transportation 15.9 -2.5% 2
Slide 18: The need for a new structure
The need for a new structure The new organization structure will help Cyient improve performance across three key dimensions: 1 Accelerate growth through a well-structured and efficient Go-to-Market (GTM) organization 2 Improve operational agility and execution excellence through a Delivery 4.0 orga
Slide 19: New Go-To-Market (GTM) Organization Structure
New Go-To-Market (GTM) Organization Structure Our Go-to-Market (GTM) structure is realigned into: • Two Vertical Business Units • Two Horizontal Business Units • Portfolio of five sectors Medical Communications Automotive Energy, Mining Technology Transportation and and Off- Semiconductor and Natura
Slide 20: BU performance per new structure Q3FY21
BU performance per new structure Q3FY21 Services DLM Group Business Units $ Mn QoQ YoY $ Mn QoQ YoY $ Mn QoQ YoY Transportation 45.1 -4.6% -25.7% 17.3 46.4% 92.6% 62.4 5.6% -10.4% Aerospace 29.2 -5.7% -35.3% 16.9 44.0% 88.1% 46.1 8.0% -14.8% Rail transportation 15.9 -2.5% 2.1% 0.4 395.2% 16791% 16.3
Slide 21: Business Performance & Outlook (1/3)
Business Performance & Outlook (1/3) Aerospace & Defense Aerospace & Defense BU grew by 8.0% QoQ and declined by 14.8% YoY. While the services business de-grew by 5.7% QoQ, our design led manufacturing business grew by 44% due to the increased spend by India/Israel. We expect a return to stability f
Slide 22: Business Performance & Outlook (2/3)
Business Performance & Outlook (2/3) E&U Our E&U business grew by 16.7% QoQ and declined by 25.3% YoY driven by growth in key accounts. We expect the positive momentum to continue in Q4, driven by our focus on expanding the presence in the EPC sector, specifically around power generation facilities,
Slide 23: Business Performance & Outlook (3/3)
Business Performance & Outlook (3/3) SIA Semiconductor was flat QoQ and witnessed a decline of 12% YoY. This was mainly due to Turnkey ASIC development where the customers (typically OEM companies) are still reluctant to make new investments. We expect the softness in this vertical to continue in Q4
Slide 24: About Cyient
Cyient (Estd: 1991, NSE: CYIENT) is a global engineering and technology solutions company. As a Design, Build, and Maintain partner for leading organizations worldwide, Cyient takes solution ownership across the value chain to help customers focus on their core, innovate, and stay ahead of the curve
Slide 25: Disclaimer
Disclaimer All the references to Cyient’s financial results in this update pertain to the company’s consolidated operations comprising: Wholly-owned and step down subsidiaries: Cyient Europe Limited; Cyient Inc.; Cyient GmbH; Cyient Australia Pty Ltd; Cyient Singapore Private Limited; Cyient KK; Cyi
Slide 26: Thank you
Thank you 25 CYIENT © 2020 CONFIDENTIAL
Slide 27: Annexure Q3 FY21
Investor PRESENTATION Annexure Q3 FY21 CYIENT © 2020 CONFIDENTIAL
Slide 28: Message from the Management
Message from the Management Commenting on the results, Mr. Krishna Bodanapu, Managing Director and Chief Executive Officer, said “Q3 FY21 results are in line with our expectations, we recorded a revenue of $141.4 Mn which was higher by 4.1% QoQ and lower by 10.4% YoY in constant currency. Services b
Slide 29: Message from the Management
Message from the Management Commenting on the results, Mr. Ajay Aggarwal, President & CFO, said, “It is satisfying to see all-round growth in revenue, operating & net profit and cash generation this quarter. The revenue for Q3FY21 stood at $141.4 Mn; growth of 4.7% QoQ (4.1% in CC). Improvement in o
Slide 30: Consolidated Financial Metrics
Consolidated Financial Metrics Key Financial Metrics Growth % ₹ Mn Q3 FY21 Q2 FY21 Q3 FY20 QoQ YoY Revenue 10,443 10,033 11,060 4.1% -5.6% Reported EBIT 1,165 1,105 1,063 5.5% 9.6% EBIT margin 11.2% 11.0% 9.6% 14 bps 154 bps Reported PAT 954 839 1,083 13.8% -11.9% Reported EPS (₹) 8.7 7.6 9.8 13.7%
Slide 31: Consolidated Revenue Segmentation
Consolidated Revenue Segmentation By Geography (%) Q3 FY21 Q2 FY21 Q3 FY20 Americas 49.1% 49.9% 56.3% Europe, Middle East, Africa 25.3% 28.9% 26.6% Asia Pacific (includes India) 25.6% 21.2% 17.1% By Business Unit (%)^ Q3 FY21 Q2 FY21 Q3 FY20 Aerospace and Defense 32.6% 31.6% 34.8% Transportation 11.
Slide 32: Consolidated Operations Metrics
Consolidated Operations Metrics Account Receivables (in Days) Q3 FY21 Q2 FY21 Q3 FY20 DSO Total 88 90 94 - Billed 68 64 59 - Unbilled 20 26 35 Order Intake ($ Mn)^ Q3 FY21 Q2 FY21 Q3 FY20 Cyient Services 178 112 173 DLM 17 15 8 Group OI Total 195 127 181 ^The Order Intake reported is the total value
Slide 33: Consolidated Client Metrics
Consolidated Client Metrics Top Clients: Revenue Contribution (%) Q3 FY21 Q2 FY21 Q3 FY20 Top 5 28.8% 29.5% 33.0% Top 10 38.4% 38.4% 44.5% No. of Million $ Clients Q3 FY21 Q2 FY21 Q3 FY20 20 Mn+ 3 3 4 10 Mn+ 7 7 11 5 Mn+ 32 32 28 1 Mn+ 94 96 93 New Clients Added 13 16 13 CYIENT © 2020 CONFIDENTIAL 7
Slide 34: Consolidated Employee Metrics
Consolidated Employee Metrics Employee Q3 FY21 Q2 FY21 Q3 FY20 Total Headcount 12,187 12,267 14,472 Technical & Pool 11,248 11,335 13,405 Non-Technical 334 310 378 Support 605 622 689 Voluntary Attrition 13.2% 9.2% 19.7% CYIENT © 2020 CONFIDENTIAL 8
Slide 35: Consolidated Other Financial Metrics
Consolidated Other Financial Metrics Capex (₹ Mn)^ Q3 FY21 Q2 FY21 Q3 FY20 Capital Expenditure 189 120 652 ^Capex includes investment and business capex Cash Position (₹ Mn) Q3 FY21 Q2 FY21 Q3 FY20 Cash & Cash Equivalent 14,313 13,509 10,239 Cash & Bank balances 5,150 4,680 4,172 Investments in FDs
Slide 36: Consolidated Income Statement
Consolidated Income Statement ₹ Mn Q3 FY21 Q2 FY21 Q3 FY20 Operating Revenue 10,443 10,033 11,060 Cost of Revenue 6,826 6,449 7,082 Direct Salary and related costs 4,219 4,075 4,873 Direct Travel 81 97 190 Delivery Management 209 249 201 Material cost 1,319 1,074 661 Other costs incl Subcontract cos
Slide 37: Consolidated Balance Sheet
Consolidated Balance Sheet ₹ Mn Q3 FY21 Q2 FY21 Q3 FY20 EQUITY AND LIABILITIES Shareholders’ funds - Share capital 550 550 550 - Reserves and surplus 27,781 26,841 25,539 Total - Shareholders' funds 28,331 27,391 26,089 Non-current liabilities - Long-term borrowings and liabilities 3,262 2,891 3,591
Slide 38: Consolidated Cash Flow Movement
Consolidated Cash Flow Movement ₹ Mn Q3 FY21 Q2 FY21 Q3 FY20 Free cash flow from operations 1,518 2,032 1,957 Investment in non current investments -640 -15 0 Interest received 175 132 138 Finance costs paid -51 -47 -73 Proceeds/(Repayment) of borrowings, net -118 612 785 Repayment of lease liabilit
Slide 39: Other Income for Q3 FY21
Other Income for Q3 FY21 All Figures in ₹ Mn Q3 FY21 Q2 FY21 Q3 FY20 For the quarter Income from Treasury • Other income is higher by ₹126 Mn (+136% QoQ) Interest on Invesmtents/Deposits 128 115 88 Dividend on Mutual Funds 0 0 8 • Treasury income has improved by ₹13 Mn from Subtotal (A) 128 115 96 h
Slide 40: Hedge Book for Q3 FY21
Hedge Book for Q3 FY21 Value in Respective Outstanding ForwardContracts* Currency Mn. Booked Rate (in ₹) for next 12 Months 151 144 (0.1) Wgt. Avg 31-Dec-20 30-Sep-20 31-Dec-19 134 (0.8) Variance of 1.1 (3.8) 99.8 99.9 89.3 90.1 77.1 73.3 0.1 (2.8) 71 69 69 53.6 56.4 57.5 57.5 29 29 26 29 28 25 17 1
Slide 41: Cyient Metrics (Excluding Design Led Manufacturing)
Cyient Metrics (Excluding Design Led Manufacturing) CYIENT © 2020 CONFIDENTIAL 15
Slide 42: Cyient Metrics (Excluding DLM) (1/3)
Cyient Metrics (Excluding Design Led Manufacturing) (1/3) By Geography (%) Q3 FY21 Q2 FY21 Q3 FY20 Americas 53.2% 53.4% 57.5% Europe, Middle East, Africa 28.2% 28.6% 25.5% Asia Pacific (including India) 18.6% 18.0% 16.9% By Business Unit (%) Q3 FY21 Q2 FY21 Q3 FY20 Aerospace and Defense 25.3% 27.1%
Slide 43: Cyient Metrics (Excluding DLM) (2/3)
Cyient Metrics (Excluding Design Led Manufacturing) (2/3) Currency Mix (%) Q3 FY21 Q2 FY21 Q3 FY20 USD 52.3% 53.3% 55.0% EURO 14.4% 10.0% 14.0% GBP 9.7% 9.8% 10.0% AUD 12.0% 12.6% 9.0% Others 11.6% 14.4% 12.0% Account Receivables (in Days) Q3 FY21 Q2 FY21 Q3 FY20 DSO Total 93 96 94 - Billed 68 65 55
Slide 44: Cyient Metrics (Excluding DLM) (3/3)
Cyient Metrics (Excluding Design Led Manufacturing) (3/3) Top Clients: Revenue Contribution (%) Q3 FY21 Q2 FY21 Q3 FY20 Top 5 35.3% 34.8% 36.6% Top 10 47.0% 45.4% 49.3% No. of Million $ Clients Q3 FY21 Q2 FY21 Q3 FY20 20 Mn+ 3 3 4 10 Mn+ 7 7 11 5 Mn+ 25 27 23 1 Mn+ 82 85 77 New Clients Added 13 16 1
Slide 45: Cyient Metrics (Design Led Manufacturing)
Cyient Metrics (Design Led Manufacturing) CYIENT © 2020 CONFIDENTIAL 19
Slide 46: Cyient Metrics (Design Led Manufacturing) (1/3)
Cyient Metrics (Design Led Manufacturing) (1/3) Income Statement - Abridged (In ₹ Mn)^ Q3 FY21 Q2 FY21 Q3 FY20 Net Revenue 1,921 1,546 1,076 Direct Salaries & other costs 270 262 233 Material Cost 1,319 1,076 661 Gross Profit 333 209 182 SG&A 64 76 147 Depreciation & amortisation 65 60 34 EBIT 204 7
Slide 47: Cyient Metrics (Design Led Manufacturing) (2/3)
Cyient Metrics (Design Led Manufacturing) (2/3) By Business Unit (%) Q3 FY21 Q2 FY21 Q3 FY20 Aerospace and Defense 65.1% 56.4% 59.6% Transportation 1.6% 0.4% 0.0% Energy & Utilities 7.5% 6.5% 14.8% Medical 25.6% 36.5% 24.4% Communications 0.2% 0.3% 1.2% Portfolio 0.0% 0.0% 0.0% Currency Mix (%)^ Q3
Slide 48: Cyient Metrics (Design Led Manufacturing) (3/3)
Cyient Metrics (Design Led Manufacturing) (3/3) No. of Million $ Clients^ Q3 FY21 Q2 FY21 Q3 FY20 5 Mn+ 7 5 5 2 Mn+ 12 11 10 1 Mn+ 12 11 16 New Clients Added 0 0 0 ^ Includes B&F Design and NewTech Key Operational Metrics^ Q3 FY21 Q2 FY21 Q3 FY20 Headcount 628 628 618 DSO (in Days) 68 60 94 DPO (in
Slide 49: Investment Pipeline & Focus Areas: Q3 FY21
Investment Pipeline & Focus Areas: Q3 FY21 M&A Corporate Investments 11 Vertical focused Medical tech, M&A strategy in key Communication 0 1^ geographic markets; 0 0 Technology, IoT/M2M Pre-LOI LOI Signed/Closed large acquisitions Evaluations Signed/Closed & Advanced avionics *Pre LOI and LOI reflec
Slide 50: About Cyient and contact details
Cyient (Estd: 1991, NSE: CYIENT) is a global engineering and technology solutions company. As a Design, Build, and Maintain partner for leading organizations worldwide, Cyient takes solution ownership across the value chain to help customers focus on their core, innovate, and stay ahead of the curve
Slide 51: Disclaimer
Disclaimer All the references to Cyient’s financial results in this update pertain to the company’s consolidated operations comprising: Wholly-owned and step down subsidiaries: Cyient Europe Limited; Cyient Inc.; Cyient GmbH; Cyient Australia Pty Ltd; Cyient Singapore Private Limited; Cyient KK; Cyi
Slide 52: Thank you
Thank you CYIENT © 2020 CONFIDENTIAL 26