Tech Mahindra Limited · NSE:TECHM
Tech Mahindra — Q4 FY23 Earnings Presentation
22 slides from Tech Mahindra's earnings presentation, March 2023
Slide 1: Earnings Presentation Q4FY23
Earnings Presentation Q4FY23 March 2023 Copyright © 2022 Tech Mahindra. All rights reserved. 1
Slide 2: Q4 FY23 Snapshot
Q4 FY23 Snapshot $ 1,668 Mn 8.2% $ 142 Mn Revenue PAT Margin Free Cash flow 11.2% $ 592 Mn EBIT Margin Net New Deal Wins Copyright © 2022 Tech Mahindra. All rights reserved. 2
Slide 3: Q4 FY23 Snapshot
Q4 FY23 Snapshot FINANCIAL OPERATIONAL SEGMENT GEOGRAPHY Revenue Headcount CME Americas 0.0% 152,400 +0.7% -0.3% (+0.3% cc) (-4,668) EBIT % IT LTM attrition Enterprise Europe 80 bps 14.8% -0.5% +3.5% (down 250 bps) PAT % Utilization IT ROW 120 bps (inc trainees) +0.0% -2.9% 86.5% (up 10 bps) FCF to
Slide 4: FY23 Snapshot
FY23 Snapshot $ 6,607 Mn 9.1% $ 497 Mn Revenue PAT Margin Free Cash flow 11.4% $ 2,905 Mn EBIT Margin Net New Deal Wins Copyright © 2022 Tech Mahindra. All rights reserved. 4
Slide 5: FY23 Snapshot
FY23 Snapshot FINANCIAL OPERATIONAL SEGMENT GEOGRAPHY Revenue Headcount CME Americas 10.1% 152,400 +9.0% +14.7% (+13.7% cc) (+1,227) (+13.4% cc) (+15.3% cc) EBIT % IT LTM attrition Enterprise Europe 320 bps 14.8% +10.9% +4.7% (down 870 bps) (+13.9% cc) (+13.3% cc) PAT % Utilization IT ROW 340 bps (i
Slide 6: Management Commentary
Management Commentary CP Gurnani CEO, Tech Mahindra As we step into FY24, we see the increasing need for businesses to stay agile by leveraging next generation technologies. We are strongly focused on helping our customers stay competitively dominant and relevant in the era of fast evolving market c
Slide 7: Vertical Performance Q4 FY23
Vertical Performance Q4 FY23 VERTICALS Communications, Banking, Financial Manufacturing Technology Retail, Transport Others Media & Services & & Logistics Entertainment Insurance % SHARE 40.1% 15.9% 15.9% 10.3% 7.6% 10.2% % QoQ +0.7% +0.3% +1.5% 0.0% -10.4% +2.7% % YoY +2.4% -5.1% +10.9% +14.8% +3.7
Slide 8: Vertical Performance FY23
Vertical Performance FY23 Banking, Communications, Retail, Financial VERTICALS Media & Manufacturing Technology Transport Others Services & Entertainment & Logistics Insurance % SHARE 40.0% 16.2% 15.7% 10.1% 8.0% 10.0% % YoY +9.0% +8.7% +9.7% +25.2% +11.9% +3.5% % YoY cc +13.4 % +12.8% +13.3% +25.9%
Slide 9: Deal-Win Performance
Deal-Win Performance Total TCV FY23: $ 2,905 Mn Q4 FY23: $ 592 Mn Select Deals: Selected as a Won a large deal with Selected as a strategic Chosen as a strategic digitalization partner by a leading American delivery partner by a partner by a large an American non-profit wireless network major financ
Slide 10: Strategic Highlights
Strategic Highlights COLLABORATIONS OTHER HIGHLIGHTS Tech Mahindra and Microsoft join hands to bring "Network Cloudification as a Service” and AIOps to telecom operators for their 5G Core networks. The 5G core network transformation will help telecom operators to develop 5G core use cases and meet t
Slide 11: People Highlights
People Highlights STRENGTH & ATTRITION AWARDS “Best Organizations for Women” – Femina Awards 2023 Our employee strength is at 152,400 “Bloomberg Gender-Equality Index” - Bloomberg 4th time in a row in 2023 “Most Preferred Workplace”- Marksman Daily and LTM attrition reduced to 14.8% from India Today
Slide 12: ESG Highlights
ESG Highlights Ranked Number 1 in S&P Global Listed on 2022 CDP Supplier Recognized as a Top-Rated ESG Sustainability Yearbook 2023 Engagement Leaderboard Performer by Sustainanalytics Dun & Bradstreet India Top ESG Performer – SW & BPM sector 2022, Environmental Risks and Opportunities award 2023 C
Slide 13: Management Commentary
Management Commentary Rohit Anand CFO, Tech Mahindra Our strategy of prudence and operational excellence helped us through the uncertainties of FY23. We continue to return cash to shareholders through a consistent dividend policy. We move into the next fiscal, with sharper focus on productivity impr
Slide 14: Financial Snapshot Q4 FY23
Financial Snapshot Q4 FY23 REVENUE ($ Mn) GROSS PROFIT ($ Mn) EBIT ($ Mn) PAT ($ Mn) 478 482 211 198 1,668 1,668 471 200 1,608 186 157 136 Q4'22 Q3'23 Q4'23 Q4'22 Q3'23 Q4'23 Q4'22 Q3'23 Q4'23 Q4'22 Q3'23 Q4'23 DILUTED EPS (Rs) FCF ($ Mn) CASH & EQUIVALENTS ROCE % ($ Mn) 142 16.9 14.6 111 12.6 28% 1
Slide 15: Operational Snapshot Q4 FY23
Operational Snapshot Q4 FY23 HEADCOUNT UTILIZATION IT ATTRITION (LTM) HEADCOUNT MIX (including trainees) (Onsite) 157,068 23.5% 151,173 152,400 86.4% 86.5% 27.2% 27.5% 27.2% 83.1% 17.3% 14.8% Q4'22 Q3'23 Q4'23 Q4'22 Q3'23 Q4'23 Q4'22 Q3'23 Q4'23 Q4'22 Q3'23 Q4'23 ACTIVE CLIENTS TOP 10 CLIENTS 50 Mn+
Slide 16: Financial Snapshot FY23
Financial Snapshot FY23 REVENUE ($ Mn) GROSS PROFIT ($ Mn) EBIT ($ Mn) PAT ($ Mn) 6,607 5,998 1,836 1,876 746 872 595 747 FY22 FY23 FY22 FY23 FY22 FY23 FY22 FY23 DILUTED EPS (Rs) FCF ($ Mn) CASH & EQUIVALENTS ROCE % ($ Mn) 28% 62.8 595 23% 54.6 497 1,141 905 FY22 FY23 FY22 FY23 FY22 FY23 FY22 FY23 C
Slide 17: Operational Snapshot FY23
Operational Snapshot FY23 HEADCOUNT UTILIZATION IT ATTRITION (LTM) HEADCOUNT MIX (including trainees) (Onsite) 152,400 86.5% 23.5% 151,173 83.1% 14.8% 28% 27% FY22 FY23 FY22 FY23 FY22 FY23 FY22 FY23 ACTIVE CLIENTS TOP 10 CLIENTS 50 Mn+ CLIENTS DSO 1,297 31% 28% 24 97 1,224 23 96 FY22 FY23 FY22 FY23
Slide 18: Other Financial Highlights
Other Financial Highlights CASH CONVERSION TREASURY OTHERS Free cash flow at $ 142 Mn, Hedge book at $ 2,335 Mn Tax rate at 26.2 % in Q4 FY23, compared to $ 2,529 Mn in Q3 compared to 27.4 % in Q3 FY23 FCF to PAT conversion: FY23 Q4 FY23: 104%, FY23: 84% USD / INR Q4 FY23 average FY23 Tax rate at 24
Slide 19: Capital Allocation
Capital Allocation CAPITAL RETURN • Announced Final Dividend of Rs 32/ Share • Total Dividend (Final and Special) for FY23, is Rs 50/ Share, highest annual dividend ever. • Total Payout Ratio for FY23 is 91% to PAT, increased from payout ratio of 79% in FY22. Copyright © 2022 Tech Mahindra. All righ
Slide 20: Financial Summary Q4 FY23
Financial Summary Q4 FY23 in $ Mn Q4’23 QoQ YoY Revenue 1,668 0.0% 3.7% EBIT 186 -6.9% -12.1% EBIT % 11.2% Other Income 37 24.2% -12.1% Miscellaneous + Interest 38 Income Exchange Gain/(Loss) -1 Impairment Costs 26 Profit Before Tax 185 -13.8% -25.0% Provision for tax 49 Profit After Tax 136 -13.7%
Slide 21: Financial Summary FY23
Financial Summary FY23 in $ Mn FY23 YoY Revenue 6,607 10.1% EBIT 747 -14.4% EBIT % 11.4% Other Income 119 -20.1% Miscellaneous + Interest 82 Income Exchange Gain/(Loss) 37 Impairment Costs 29 Profit Before Tax 793 -20.6% Provision for tax 196 Profit After Tax 595 -20.3% PAT % 9.1% EPS (Basic) in Rs
Slide 22: Copyright © 2022 Tech Mahindra. All rights reserved.
Copyright © 2022 Tech Mahindra. All rights reserved. 22