Sonata Software Limited · NSE:SONATSOFTW
Sonata Software — Q4 FY2021 Earnings Presentation
36 slides from Sonata Software's earnings presentation, May 12, 2021
Slide 1: Cover letter to stock exchanges
12th May, 2021 National Stock Exchange of India Limited BSE Limited Exchange Plaza, Bandra Kurla Complex, P.J. Towers, Dalal Street Mumbai Mumbai Kind Attn: Manager, Listing Department Kind Attn: Manager, Listing Department Email Id: neaps@nse.co.in Email Id: listing.centre@bseindia.com Stock Code -
Slide 2: Sonata Software Investor Presentation Q4 2021
Sonata Software Investor Presentation Q4 2021 1 © Sonata Software Ltd, 2020. Confidential.
Slide 3: Sonata - A Snapshot
Sonata - A Snapshot 4200+ TEAM 34 YEARS $550+ M REVENUE across US, EU, Asia, SEI CMMI L5, ITIL The Company as a IT Solutions 14% 3 Yr. CAGR ANZ, Japan, & ISO certified Provider Malaysia, and China CPG & MFG SERVICES AGRI & RETAIL TRAVEL SOFTWARE Industry Consumer Goods, Industrial Apparel, Hard TO,
Slide 4: Sonata Vision
Sonata Vision For the Customers IT Partner of choice for transformation A world class firm thru deeper industry, technology & that is a benchmark for customer focus Catalyzing Business Transformation for our Clients, Fulfilling Employee Aspirations & For the Employee Caring for our wider A fun & fea
Slide 5: Sonata Vision into differentiated strategy Summed up in 4 P's
Sonata Vision into differentiated strategy Summed up in 4 P’s PEOPLE PARTNERS A STORY OF SUBLIME GRACE & HOW SONATIANS ROCK AT THE SWEET SOUND OF SOCIAL ONE TEAM. ONE DREAM. ONE PERFECT TIMING WITH OUR DELIVERING ON CLIENT GOALS… GOOD… SONGBOOK. PARTNER, MICROSOFT Focus on Talent – building an Commi
Slide 6: Vertical Focus
Vertical Focus • Retail, travel, distribution & CPG, ISV, Commodity Trading, and services industry – field services • IP – Brick and Click, Modern Distribution, Agri Business, Rezopia, service industry, GBW • Platform led Digital Transformation • Track record 5 © Sonata Software Ltd, 2020. Confident
Slide 7: What is different about Platformation as a tool for Digital Transformation
What is different about Platformation™ as a tool for Digital Transformation • Sonata’s structured process for Platformation comprises the following : • Digital Business Process Library & Identification • Customer Digital Agenda led based approach • Platform Maturity Assessment ( Separate Business &
Slide 8: Platformation
Platformation™ Platforms - the secret behind the digital economy’s most successful companies OPEN SCALABLE CONNECTED INTELLIGENT Sonata’s approach to Digitizing business using platforms PLATFORMATION™ 7 © Sonata Software Ltd, 2020. Confidential.
Slide 9: Approaches to achieve Platformation
Approaches to achieve Platformation™ Sonata Sonata Sonata READY ACCELERATE CUSTOM • End-to-end, industry- • Deploy popular • Engineer custom specific digital horizontal platforms platforms that deliver business platforms adding required unique digital functionality capability and scalability Omni ch
Slide 10: Engineering Excellence
Engineering Excellence Focused approach • Industry Specialization • Retail, travel, distribution & CPG, ISV, Commodity Trading, and services industry – field services • Expertise thru IP’s • Brick and Click, Modern Distribution, Agri Business, Rezopia, service industry, GBW • Proprietary & proven ap
Slide 11: Global Full Stack Microsoft Partner aligned to the Digital Transformation vision
Global Full Stack Microsoft Partner aligned to the Digital Transformation vision 25 Years 360 Partner Partnership MICROSOFT PARTNER 15 Gold certified Product Engineering, competencies. Skills in GISV, lSP, CSP, ISV Dev Centre, SI. Professional support, Delivery, Dynamics 365, Power BI, Country Partn
Slide 12: Delivering value through our innovative engagement models
Delivering value through our innovative engagement models Customer-Specific Center of Excellence • Governance • Value Co-creation • Leadership role • SLAs and outcomes • Strategic metrics • Co-investment in IP TECHNOLOGY | SKILLS | ASSETS | PROCESSES Domain Knowledge | Technical Knowledge | Knowledg
Slide 13: With a team nurtured to make a difference
With a team nurtured to make a difference Regular exposure to newer technologies, evolving business Deeper roles scenarios, and building cross-functional expertise Customer Continuous exposure to clients to assess business impact of impact solutions delivered Freedom Our flexible working style encou
Slide 14: Financials
IN COICO SONATA SOFTWARE
Slide 15: Strong Execution
Strong Execution International Services Domestic Business • Growth from existing clients • Strong Customer Retention • Acquiring new clients • Established Customer Base • Strong growth in new clients • Multi year annuity license sales • Alliance led growth ensure revenue continuity & growth • IP led
Slide 16: Financial Management
Financial Management • Focus on ROCE and RONW • Focus on margins • Focus on Reduction of DSO days • Focus on strong cash management • Sound capital allocation 15 © Sonata Software Ltd, 2020. Confidential.
Slide 17: Revenue trend for last 12 Quarters
Revenue trend for last 12 Quarters International Services Domestic Business 400 1,200 1,099 350 330 325 319 301 304 304 313 276 288 1,000 912 300 275 284 242 257 800 revenue in Rs cr 250 607 681 761 revenue in Rs cr 200 600 563 537 574 523 437 150 389 399 400 326 100 200 50 - - Q4 Q1 Q2 Q3 Q4 Q1 Q2
Slide 18: Financial Performance of International Services – Q4 FY21
Financial Performance of International Services – Q4 FY21 Revenue in INR. Cr 200.0 EBITDA 45.0% 180.0 40.0% 160.0 35.0% 29.0% 28.4% 140.0 30.0% INR in Crore 325.5 120.0 22.2% INR in Crore 25.0% 319.0 6.0 % QoQ 100.0 20.0% 80.0 90.5 3.8 % QoQ 60.0 87.2 15.0% 72.3 -2.0 % YoY 40.0 10.0% 300.9 20.0 5.0%
Slide 19: International Business Revenue Growth
International Business Revenue Growth Revenue in $Million New Customer added 12 $45 $44 $44 10 10 $44 10 $43 8 8 $42 7.0 % QoQ $41 6 6 $41 -1.2 % YoY $40 4 $39 2 Q4 20 Q3 21 Q4 21 0 Q1 21 Q2 21 Q3 21 Q4 21 Client Concentration No. of $Million Customers 40 80% 73% 71% 71% 35 64% 62% 29 30 57% 61% 30
Slide 20: Consistent Growth Over Last 10 Years
Consistent Growth Over Last 10 years Consolidated Revenue & EBITDA 4,500 4,228 4,000 3,743 3,500 2,961 3,000 Amount in Rs Cr. 2,371 2,454 2,500 1,941 2,000 1,566 1,682 1,500 1,311 1,069 1,000 366 431 407 500 191 239 246 278 35 59 117 - FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 FY 21 Reve
Slide 21: Operational Performance – Q4 FY21
Operational Performance – Q4 FY21 Revenue by Geography No. of Customers by Geo 120% 100% 16% 22% 24% 80% QoQ Growth ANZ, 31 Europe, 37 30% 60% 26% 25% USA – 5.3% Europe – 4.5% Asia, 12 40% ROW – 13.1% Middle East, 2 54% 52% 51% 20% India, 25 0% US, 57 Q4 20 Q3 21 Q4 21 USA Europe Rest of World No. o
Slide 22: Revenue by Vertical Mix and high end Service Mix
Revenue by Vertical Mix Revenue by high end Service Mix 100.0% 6.0% 7.0% 7.0% 100.0% 2.0% 2.0% 1.5% 4.0% 1.7% 1.0% 90.0% 3.0% 1.3% 1.5% 90.0% 10.6% 11.1% 4.0% 8.0% 8.5% 13.1% 80.0% 18.0% 80.0% 11.7% 10.7% 20.5% 21.4% 70.0% 14.7% 70.0% 60.0% 20.0% 60.0% 28.1% 29.2% 50.0% 21.2% 18.7% 50.0% 27.7% 40.0%
Slide 23: IP Led Revenue % and Platformation Revenue %
IP Led Revenue % PlatformationTM Revenue % 40% 19% 34 33% 33% 33% 34% 33 33 35% 18% 30 30% 27 25% 25% 18% 25% 17% 20% 17% 18% 18% 18% 15% 17% 16% 10% 16% 16% 5% 15% 0% Q4 20 Q1 21 Q2 21 Q3 21 Q421 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q421 % of Contribution on Total Revenue Platformation Revenue % No. of Cu
Slide 24: Digital Revenue %
Digital Revenue % 75% 70% 67% 64% 65% 60% 60% 54% 55% 50% 45% 38% 40% 35% 30% 25% 20% 15% 10% 5% 0% Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 23 © Sonata Software Ltd, 2020. Confidential.
Slide 25: International Business - Revenue Enablers
International Business - Revenue Enablers Revenue by Onsite / Offshore Mix Utilization & Billability 95% 100% 90% 89% 89% 90% 87% 80% 85% 59% 85% 83% 70% 62% 63% 65% 68% 79% 79% 60% Offshore 80% 77% 75% Billability 50% Onsite 75% Utilisation 40% 70% 30% 70% 20% 41% 38% 37% 35% 32% 65% 10% 0% 60% Q4
Slide 26: Human Capital
Human Capital Overall Headcount Headcount by Business Type 4,400 4,400 4,211 4,211 4,200 4,111 4,102 4,200 4,111 4,102 235 3,997 145 3,997 4,000 3,885 4,000 145 146 267 257 3,885 185 146 256 3,800 G&A 3,800 141 183 262 178 Domestic 177 S&M 3,600 3,600 International 173 Delivery 4,066 3,966 3,956 3,4
Slide 27: Domestic Business – Gross Contribution
Domestic Business – Gross Contribution 45.0 38.0 38.1 40.0 36.0 32.0 33.0 35.0 30.0 30.0 30.1 29.0 30.0 25.0 8.0% 20.0 5.5% 5.4% 5.8% 15.0 5.2% 5.0% 4.4% 10.0 3.9% 3.5% 5.0 0.0 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Gross Contribution in INR Cr. Gross Contribution % 26 © Sonata Softwa
Slide 28: Domestic Business - Revenue
Domestic Business - Revenue Domestic Revenue (Annuity/Others) Domestic Revenue (Cloud/Non Cloud) 120% 120% 100% 100% 34% 32% 28% 25% 80% 36% 36% 37% 80% 43% 41% 39% 60% 60% 40% 40% 66% 68% 72% 75% 64% 64% 61% 63% 57% 59% 20% 20% 0% 0% Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 % of
Slide 29: Domestic Business - Gross margin Analysis by customers
Domestic Business - Gross margin Analysis by customers Domestic Customer Count Domestic Customer by GC % 120% 100 90 100% 80 12% 11% 11% 16% 11% 9% 11% 70 36 44 80% 11% 9% 40 34 14% 10% 60 35 12% 14% 9% 24 12% 50 60% 40 26 22 24 24 16 40% 30 25 64% 65% 66% 66% 60% 20 20% 10 25 27 24 24 27 19 0 0% Q4
Slide 30: EBITDA, PBT and PAT – last 12 Quarters
EBITDA, PBT and PAT – last 12 Quarters Domestic Business Domestic Business EBITDA Domestic Business PBT 35.0 31.8 35.0 30.3 30.0 27.0 27.3 30.0 24.8 25.1 23.2 25.0 25.0 21.2 22.4 22.5 20.6 21.0 21.0 22.0 19.5 19.6 18.1 18.2 20.0 17.7 16.9 20.0 15.4 15.8 16.7 14.0 14.8 15.9 16.4 15.8 15.0 15.0 10.0 1
Slide 31: Strategic Investment
Strategic Investment M&A Investment 50.0 46.3 39.5 40.0 30.0 20.0 13.4 10.0 4.3 0.6 - FY 17 FY 18 FY 19 FY 20 FY 21 IP & R&D Investment S&M Investment 35.0 32.3 62.9 70.0 28.3 30.0 25.2 60.0 52.3 49.2 25.0 22.2 50.0 42.2 20.4 36.7 20.0 40.0 15.0 30.0 10.0 20.0 5.0 10.0 - - FY 17 FY 18 FY 19 FY 20 FY
Slide 32: International and Domestic ROCE & RONW
International and Domestic ROCE & RONW ROCE RONW ROCE RONW 40% 35% 35% 36% 45% 39% 39% 40% 35% 29% 29% 31% 32% 30% 35% 33% 30% 30% 35% 28% 30% 25% 29% 20% 23% 23% 20% 24% 22% 15% 10% 10% 5% 0% 0% Q4 20 Q1 21 Q2 21 Q3 21* Q4 21 Q4 20 Q1 21 Q2 21 Q3 21* Q4 21* International Business Domestic Business
Slide 33: Capital Allocation
Capital Allocation Cash Deployment 30,000 27,693 24,927 24,396 25,000 21,295 3% 20,000 19,253 15,859 15,634 Capex Amount in Rs. lakhs 15,000 13,369 13,408 39% Share holder Payout 11,042 48% 9,464 9,464 Acquisition 10,000 7,361 Invested 5,000 4,206 10% - FY15 FY16 FY17 FY18 FY19 FY20 FY21 Consolidate
Slide 34: Days Sales Outstanding
Days Sales Outstanding Consolidated DSO 70 58 60 55 50 45 47 50 44 44 43 37 40 30 20 10 0 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 International Services DSO Domestic Services DSO 57 60 70 63 59 57 47 47 60 50 44 52 41 41 42 47 47 49 36 36 50 43 40 40 33 30 30 20 20 10 10 0 0 Q4 19 Q1 2
Slide 35: Credit Management – Domestic Business
Credit Management – Domestic Business Average Borrowings & Interest Cost 140 14,000 120 12,000 100 10,000 80 8,000 60 6,000 40 4,000 20 2,000 - - Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY17 FY17 FY17 FY17 FY18 FY18 FY18 FY18 FY19 FY19 FY19 FY19 FY20 FY20 FY20 FY20 FY21 FY21 FY21
Slide 36: Thank you
IN COICO SONATA SOFTWARE