Slide 1: Investor Update Q3 2016
Passionate Employees Investor Update Innovative Services Q3 2016 Delighted Customers 25th October 2016 © Hexaware Technologies. All rights reserved. www.hexaware.com
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements on this presentation concerning our future growth prospects are forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and un
Slide 3: Business Update
Business Update © Hexaware Technologies. All rights reserved. | www.hexaware.com 3
Slide 4: Key Financials for Q3 2016
Key Financials for Q3 2016 GROWTH GROWTH Q3 2016 Q2 2016 QoQ YoY Revenue 135.24 129.68 4.29% 8.08% EBITDA* 24.65 20.86 18.14% 2.50% (before ESOP Cost) EBITDA 23.58 20.17 16.93% 5.55% (after ESOP Cost) PAT 16.67 14.90 11.93% -2.23% EPS Diluted ** 3.66 3.29 11.37% -0.14% * Excludes ESOP Cost of $1.07
Slide 5: Movement of Top 20 Customers
Movement of Top 20 Customers Top 20 Accounts by Revenue for the Quarter (instead of LTM) Q3 2016 vs. Q2 2016 IN OUT ▪ UK’s leading insurance ▪ American investment company management firm ▪ American multinational ▪ Fortune 500 global conglomerate corporation corporation © Hexaware Technologies. All r
Slide 6: Strategy Proof Points
Strategy Proof Points USD 42 million NN Deal wins in Q3-16 Automation led Application Management transformation Shrink IT for a global publisher and distributor of Children’s books, print and digital material Human Resources Operation optimization through Shrink IT Automation for one of the largest
Slide 7: Improved Depth of Customer Relationships
Improved Depth of Customer Relationships Q3 2015 Q3 2016 GROWTH TOP CLIENTS QoQ $50+ 1 2 Top 5 Clients 13.9% $30 - $50 3 1 Top 10 Clients 10.2% $20 - $30 0 2 Top 20 Clients 7.8% $10 - $20 5 3 $5 - $10 8 7 $1 - $5 48 63 >$1 65 78 Last twelve months revenue © Hexaware Technologies. All rights reserved
Slide 8: Shareholder Metrics
Shareholder Metrics RETURN ON EQUITY TOTAL SHAREHOLDER RETURNS Stock price as at the end of each quarter 31% 269.2 28% 247.6 243.5 26% 229.0 25% 22% 188.6 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 DIVIDEND PAYOUT Dividend declared for the year 11.10 8.65 6.95 4.
Slide 9: Employee Metrics
Employee Metrics UTILIZATION * EMPLOYEE ATTRITION Utilization back to high levels Significant efforts taken to contain attrition 74.1% 73.6% 17.4% 16.9% 73.0% 16.6% 17.1% 16.0% 16.6% 16.5% 72.1% 70.4% 14.1% 70.3% 69.7% 69.6% 70.0% 13.0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2014
Slide 10: North America led Growth
North America led Growth APAC, GROWTH GROWTH Europe, 6% GEOGRAPHY (1) QoQ YoY 12% North America 5.6% 10.4% Europe (2) -3.5% -5.0% APAC 2.7% 5.5% North America, TOTAL 4.3% 8.1% 82% Note: (1) Geographies have been reclassified from Q1-16 and previous period figures have been restated This reclassifica
Slide 11: Banking & Financial Services led Growth
Banking & Financial Services led Growth GROWTH GROWTH Manufacturing & VERTICAL QoQ YoY Consumer, and Banking & Financial Others, 28% Banking & Financial Services, 42% 8.6% 19.5% Services Travel & Transportation 4.5% -6.2% Healthcare & Insurance -1.9% 5.6% Manufacturing & Healthcare & 1.9% 2.9% Consu
Slide 12: IMS and BPS led Growth
IMS and BPS led Growth GROWTH GROWTH HORIZONTAL QoQ YoY Application Development & 5.3% 8.0% Maintenance (ADM) BPS, 7% IMS, 8% ADM, 37% Enterprise Solutions (ES) -3.5% -9.2% BIBA, 15% Digital Assurance/ Testing (DA) 4.7% 4.9% Business Intelligence & Analytics 2.3% 11.8% (BIBA) ES, 12% Business Proces
Slide 13: Journey so far
Journey so far 9 Quarter Two Year Q3 2016 Q2 2014 GROWTH Q2 2016 Q2 2014 GROWTH Revenue 135.24 101.96 32.6% Revenue 129.68 101.96 27.2% EBITDA * 20.86 17.90 16.5% EBITDA * 24.65 17.90 37.7% PAT 14.90 12.77 16.6% PAT 16.67 12.77 30.5% EPS 3.29 2.54 29.7% EPS 3.66 2.54 44.1% © Hexaware Technologies. A
Slide 14: Financial Update
Financial Update © Hexaware Technologies. All rights reserved. | www.hexaware.com 14
Slide 15: Revenue
Revenue Q3 2016 constant currency revenue at $135.9 mn; 4.8% QoQ; 8.9% YoY Q3 16 $ Revenue at $135.2 mn; 4.3% QoQ; 8.1% YoY Q3 16 INR Revenue at RS 9041 mn; 4.0% QoQ; 10.5% YoY © Hexaware Technologies. All rights reserved. | www.hexaware.com 15
Slide 16: Revenue Analysis - QoQ
Revenue Analysis - QoQ 4.9% Volume Growth 6.30 0.40 136 135.2 (0.30) (0.63) 134 (0.21) 132 USD Mn---------------> 129.7 130 128 126 124 Increases Decreases 122 120 Bill Rates Volume Mix Calendar Revenue Q2 16 Revenue Q3 16 FX - © Hexaware Technologies. All rights reserved. | www.hexaware.com 16
Slide 17: Gross Margin Analysis - QoQ
Gross Margin Analysis - QoQ 37.00 0.98 0.11 36.2 36.00 0.78 (0.41) 35.1 35.00 (0.10) %---------------------> (0.21) (0.07) 34.00 33.00 Increases Decreases 32.00 31.00 30.00 Utilisation Others cost saving Mix Increment Bill rates GM Q2 16 Calender GM Q3 16 Visa SG&A by 100 bps QoQ © Hexaware Techno
Slide 18: Outstanding Hedge Position and Rates
Outstanding Hedge Position and Rates Outstanding Hedge Position Currency Pair Amount (Mn.) Avg. Rate USDINR ($) 142.32 72.11 EURNR (€) 4.30 80.64 GBPNR (£) 4.20 105.06 Total ($) 152.57 Note - 1.Hedges outstanding are full-term hedges. 2. EUR converted @ 1.1172/USD & GBP converted @ 1.2976/USD. 3. Av
Slide 19: Forex Gain/ (Loss)
Forex Gain/ (Loss) Total Gain/(Loss) 1.11 • Forex gain of $0.95 Mn this 0.95 0.92 quarter as against a gain of $1.82 Mn in Q2’16. USD Mn-----------> • Forex gain expected ~ $ 0.92 Mn in Q4’16 and ~$ 1.11 Mn in Q1’17 at exchange rate of INR 66.6150/USD. Q3'16 Q4'16 Q1'17 © Hexaware Technologies. All
Slide 20: Balance Sheet Updates
Balance Sheet Updates CASH & CASH EQUIVALENTS Cash and Cash Equivalents* at US$ 51.44 M (INR 3426 M) DAYS SALES OUTSTANDING Days Sales Outstanding (DSO) for Q3 2016 at 50 days; 75 days including unbilled DIVIDEND INR 1.00 per share (50%) Dividend Payout including taxes INR 363.4 mn ($ 5.5 Mn) © Hexa
Slide 21: Buyback of Shares
Buyback of Shares Buy back 12.0 % of networth Offer price Rs. 240 per equity share payable in cash for an aggregate amount not exceeding Rs. 1,367 million ($20.5 million) No of shares being 5.69 million (representing 1.9% of total repurchased equity capital) It will be on tender basis EPS increase 1
Slide 22: Capex 2016
Capex 2016 US$mn Q316 YTD Siruseri Phase II 2.43 12.25 Hinjewadi - Phase I 3.05 5.84 Computers & Equipments & Others 1.35 5.80 Grand Total 6.83 23.89 US $18 – 20 Mn of Capex expected in Q4 16, as Chennai / Pune likely to be completed Tax: ETR is constant @25.8% © Hexaware Technologies. All rights re
Slide 23: Thank you
Passionate Employees Innovative Thank you Services Delighted Customers © Hexaware Technologies. All rights reserved. | www.hexaware.com