Slide 1: Investor Update Q1 2020
Investor Update Q1 2020 29th April 2020 © 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: Use of Non-GAAP Financials
Use of Non-GAAP Financials Hexaware has included non-GAAP financial measures in this presentation to supplement Hexaware’s consolidated financial statements presented on a GAAP basis. These non-GAAP financial measures may have limitations as analytical tools, and these measures should not be conside
Slide 4: Key Highlights
Key Highlights Q1 Revenue Q1 EBITDA% Q1 EPS $ 210.6 M 14.9% ₹ 5.86 • Q/Q decline of 1.7%; 1.1% in CC • Q1 EBITDA of $ 31.3M • Q/Q growth of 4.4%, Y/Y growth of 26.1%; • Y/Y growth of 17.0%; 18.2% in CC • Q/Q decline of 80 bps • Non GAAP EPS of ₹ 6.18; Q/Q growth of • COVID-19 impact: 2%-3% of Revenu
Slide 5: Q1 2020 Business Update
Q1 2020 Business Update www.hexaware.com | © Hexaware Technologies. All rights reserved. 5
Slide 6: Q1 | Financial Performance
Q1 20 | Financial Performance GROWTH GROWTH Amounts in US$ M Q1 2020 Q4 2019 Q1 2019 QoQ YoY Revenue 210.6 214.3 -1.7% 180.0 17.0% EBITDA 32.4 31.9 1.7% 27.6 17.7% EBITDA % 15.4% 14.9% 0.5% 15.3% 0.1% EBITDA (post RSU) 31.3 33.6 -6.6% 27.0 16.3% EBITDA % (post RSU) 14.9% 15.7% -0.8% 15.0% -0.1% EBIT
Slide 7: Revenue Walk | QoQ
Revenue Walk | QoQ $M 1.8 1.1 (0.8) (4.5) 214.3 (1.3) 210.6 Q4 19 Forex Mix Bill Rates Calendar Volume Q1 20 Increase Decrease www.hexaware.com | © Hexaware Technologies. All rights reserved. 7
Slide 8: EBITDA Walk | QoQ
EBITDA Walk | QoQ % of revenue Gross Margin 0.4 (0.2) 0.7 (0.2) (0.6) 1.0 (1.3) 15.7 (0.4) (0.6) 0.4 14.9 Utilization SG&A ESOP Q4 19 Bill Rates Calendar IAS 116 Q1 20 Forex Mix Increments Other Costs Increase Decrease * EBIDTA (post ESOP cost) www.hexaware.com | © Hexaware Technologies. All rights
Slide 9: Q1 | GAAP to Non-GAAP Reconciliation
Q1 20 | GAAP to Non-GAAP Reconciliation Q1 ’20 Q4 ’19 Q1 ’19 Amounts in $ M PBT Tax PAT EPS* (INR) EPS* (INR) Reported (GAAP numbers) 28.7 5.3 23.4 5.86 5.62 4.65 Q1 ‘20 GAAP EPS Change 0.25 1.21 % Change 4.4% 26.1% Non-GAAP Adjustments Amortization of intangibles 1.6 0.4 1.2 0.28 NPV of deferred pa
Slide 10: Improved Depth of Customer Relationships
Improved Depth of Customer Relationships Q1 2019 Q1 2020 Client Contribution for Q1 20 and Q1 19 $50+ 3 3 Contribution Top Clients Q1 20 Q1 19 Change YoY $30 - $50 0 0 Top 5 Clients 34.3% 41.7% -7.4% $20 - $30 2 3 Top 10 Clients 45.1% 51.1% -6.1% $10 - $20 4 8 $5 - $10 19 21 $1 - $5 71 91 >$1 99 126
Slide 11: Key Wins
Key Wins USD 69 million NN Deal wins in Q1 20 Enterprise Data Management Services for a major US-based management consulting firm Digital Platform Services for a US-based credit union company Financial process automation for a leading global printer manufacturer Cloud powered HCM solution for a US-b
Slide 12: Employee Metrics
Employee Metrics UTILIZATION EMPLOYEE ATTRITION 81.3% 80.7% 18.2% 18.2% 78.2% 79.0% 78.7% 79.0% 79.0% 78.5% 17.0% 17.3% 76.5% 15.7% 15.8% 15.1% 14.4% 13.4% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2018 2018 2018 2018 2019 2019 2019 2019 2020 2018 2018 2018 2018 2019 2019 2019 2019 2020
Slide 13: Q1 Revenue Results
Q1 20 Revenue Results APAC HTPS IMS 8.0% 15.7% 13.4% BPS ATM Europe BFS 8.5% 17.8% 42.5% 36.8% M&C 17.5% BIBA 11.4% North America H&I GTT DA ES 74.2% 20.1% 9.9% 15.9% 8.3% GROWTH GROWTH GROWTH GROWTH GROWTH GROWTH GEOGRAPHY VERTICAL HORIZONTAL QoQ YoY QoQ YoY QoQ YoY North America -2.1% 14.1% BFS 1.
Slide 14: COVID-19 Update
COVID-19 Update 1. We tackled COVID-19 with three objectives: ▪ First and foremost is to ensure health and safety of our employees ▪ Second is to deliver exceptional services to customers through the crisis ▪ Third is to contribute to community we are part of to the extent we can 2. We were early in
Slide 15: Third Party Survey | 93%+ Respondent satisfied with Hexaware's Business Continuity Efforts
Third Party Survey | 93%+ Respondent satisfied with Hexaware’s Business Continuity Efforts Planning & implementation Communication Productivity of teams of the business continuity plan from Hexaware teams (Meeting Delivery/SLA commitments) 1% 3% 1% 6% 3% 5% 29% 34% 37% 56% 60% 65% www.hexaware.com |
Slide 16: Customer Delight during COVID-19
Customer Delight during COVID-19 Q. How happy are you with the way your IT providers handled COVID-19 situation? Industry Hexaware 28% very 45% delighted very delighted 52% 69% satisfied satisfied 3% 3% Cloudify unhappy Everything unhappy www.hexaware.com | © Hexaware Technologies. All rights reserv
Slide 17: Guidance for 2020
Guidance for 2020 COVID-19 has led to significant uncertainty in the current environment. In view of the above, we suspend the guidance that was provided earlier for FY’20 www.hexaware.com | © Hexaware Technologies. All rights reserved. 17
Slide 18: Finance Update
Finance Update www.hexaware.com | © Hexaware Technologies. All rights reserved. 18
Slide 19: Q1 Performance
Q1 20 Performance US$ M 214.3 210.5 210.6 Key Highlights 188.5 ❑ Q1’20 revenue of $ 210.6M 180.0 ▪ Q/Q decline of 1.7%, 1.1% in CC ▪ Y/Y growth of 17%, 18.2% in CC Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 QoQ 2.2% 4.7% 11.7% 1.8% -1.7% YoY 10.9% 12.0% 23.1% 21.7% 17.0% ❑ Q1’20 revenue of INR 15,418M 15,418 INR
Slide 20: Outstanding Hedge Position and Rates
Outstanding Hedge Position and Rates Q1'20 Avg. Rate (Previous Qtrs.) Currency Pair Amount (M) Avg. Rate Q4'19 Q3'19 Q2'19 USDINR ($) 212.17 75.77 74.85 74.15 73.54 EURINR (€) 6.60 89.04 89.02 89.72 89.57 GBPINR (£) 13.48 100.11 99.14 98.73 99.27 Total ($) 236.05 Note - 1.Hedges outstanding are full
Slide 21: Forex Gain/(Loss)
Forex Gain/(Loss) USD M 5.79 • Q1'20 registered a forex gain of $ 5.79 M • Forex Gain/Loss expected in next two quarters basis Q1 closing exchange rate 2.75 of INR 75.67 per USD are: o Q2’20 ~ $-1.0 M 1.05 0.7 o Q3’20 ~ $0.7 M 0.05 (1.20) (1.0) Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 (F) Q3'20 (F) www.h
Slide 22: Balance Sheet & Other Updates
Balance Sheet & Other Updates Cash Balance ($M) DSO (days) 125.9 Total Billed Unbilled 80 82 74 77 76 59 57 51 54 51 58.2 29.9 35.4 25 * 23 23 25 21 25 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 *Cash balance after payment towards acquisition Effective Tax Rate (%) Capex ($M) 4.6 4.
Slide 23: Thank you
Innovative Services Passionate Employees Thank you www.hexaware.com Delighted Customers www.hexaware.com | © Hexaware Technologies. All rights reserved. 23