Tata Consultancy Services Limited · NSE:TCS
Tata Consultancy Services — Q4 FY2020 Earnings Presentation
37 slides from Tata Consultancy Services's earnings presentation, Apr 16, 2020
Slide 1: TCS Financial Results Quarter IV & Year Ended FY 2019-20
TCS Financial Results Quarter IV & Year Ended FY 2019 - 20 April 16, 2020 | Copyright © 2020 Tata Consultancy Services Limited
Slide 2: Disclaimer
Disclaimer Certain statements in this release concerning our future prospects are forward-looking statements. Forward-looking statements by their nature involve a number of risks and uncertainties that could cause actual results to differ materially from market expectations. These risks and uncertai
Slide 3: Quarterly Financial Performance
Quarterly Financial Performance
Slide 4: Q4 FY20 Performance Highlights
Q4 FY20 Performance Highlights ➢ Revenue: - INR Revenue of ` 399,460 Mn, up 5.1% YoY - USD Revenue of $ 5,444 Mn, up 0.9% YoY - Constant currency revenue up 3.0% YoY ➢ Profit: - Operating Margin at 25.1% - Net Margin at 20.2% - Cash flow from operations at 109.4% of net profit ➢ Demand: - Clients $1
Slide 5: Growth Summary (INR)
Growth Summary (INR) Revenue Y-o-Y Growth Y-o-Y Growth CC 389,770 398,540 399,460 380,100 381,720 18.5% ` Million 11.4% 8.4% 6.8% 12.7% 5.1% 10.6% 5.8% 6.7% 3.0% Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Operating Income Operating margin (%) 99,740 100,250 95,37
Slide 6: Growth Summary (USD)
Growth Summary (USD) Revenue Y-o-Y Growth Y-o-Y Growth CC 5,485 5,517 5,586 5,397 5,444 12.7% 10.6% $ Million 8.4% 6.8% 8.5% 8.6% 6.4% 3.0% 5.8% 0.9% Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Operating Income Operating margin (%) 1,354 1,325 1,326 1,398 1,366 $
Slide 7: Annual Financial Performance
Annual Financial Performance
Slide 8: FY20 Performance Highlights
FY20 Performance Highlights ➢ Revenue: - INR Revenue of ` 1.57 Tn, growth of 7.2% YoY - USD Revenue of $ 22,031 Mn, growth of 5.3% YoY - Constant currency revenue growth of 7.1% ➢ Profit: - Operating Income at ` 385,800 Mn, Operating Margin of 24.6% - Net Income at ` 323,400 Mn, $ 4,541 Mn, Net Marg
Slide 9: Growth Summary
Growth Summary Summary ` Summary $ Revenue & Growth (Actual & CC) % Revenue & Growth (Actual & CC) % 1,569,490; 22,031; 1,464,630; 20,913; 5.3% 7.2% 19,089; 9.6% 7.1% 19.0% 7.1% 11.4% 1,231,040; $ Million ` Million 11.4% 8.6% 4.4% 6.7% 6.7% FY18 FY19 FY20 FY18 FY19 FY20 Operating Income & Margin % O
Slide 10: Operational Parameters
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Slide 11: Growth by Market
Growth by Market Y-o-Y YoY Geography (%) Q4 FY19 Q4 FY20 FY19 FY20 CC Growth CC Growth Americas North America 50.7 50.3 0.2 51.0 50.4 4.3 Latin America 2.0 1.8 3.9 2.0 1.9 5.8 Europe UK 15.9 16.0 5.4 15.6 15.9 10.4 Continental Europe 14.1 15.2 11.9 14.1 14.7 14.6 India 5.8 5.5 -1.9 5.7 5.7 6.8 Asia
Slide 12: Growth by Domain
Growth by Domain Y-o-Y YoY Vertical (%) Q4 FY19 Q4 FY20 FY19 FY20 CC Growth CC Growth BFSI 30.9 29.7 -1.3 31.1 30.5 5.2 Retail & CPG 15.2 15.4 4.2 15.4 15.2 5.5 Communication & Media 6.8 7.2 9.3 6.9 7.0 9.8 Manufacturing 9.6 10.1 7.0 9.9 9.9 7.3 Life Sciences & Healthcare 7.7 8.8 16.2 7.5 8.3 16.8 T
Slide 13: Service Lines Commentary
Service Lines Commentary Agile is a key enabler for our clients to address Strong emphasis on Cyber Risk and Maturity of their enterprise-wide operating model Cyber protection among CXOs, who are transformation goals and has driven a number of increasingly looking to TCS for establishing a strategic
Slide 14: Client Parameters
Client Parameters Clients Contribution FY19 FY20 US$ 1m+ Clients 1008 1072 US$ 5m+ Clients 532 565 US$ 10m+ Clients 371 391 US$ 20m+ Clients 215 240 US$ 50m+ Clients 99 105 US$ 100m+ Clients 44 49 *Last Twelve Months' services revenues
Slide 15: Key Highlights (1/3)
Key Highlights (1/3) Consulting & Services Integration • Engaged by a US-based global fragrance manufacturer and • Selected by an investment management company, as the partner of • Engaged by an American business and financial services company, to supplier, to transform their IT infrastructure, secu
Slide 16: Key Highlights (2/3)
Key Highlights (2/3) Cyber Security, Enterprise Applications and Cloud • Chosen by a UK-based pharmaceutical products company, as its strategic partner in Security Services. TCS will leverage Agile methodology to develop and support identity and access management services worldwide for expedited onb
Slide 17: Key Highlights (3/3)
Key Highlights (3/3) Cognitive Business Operations, Enterprise Intelligent Automation Interactive, Analytics & Insights • Selected by a global leader in Retail and wholesale pharmacy, to advance transformation of its global IT • Engaged by a North American passenger railroad service provider, to acc
Slide 18: Human Resources
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Slide 19: Total Employee Base
Total Employee Base Total Employees : 448,464 Attrition*: • 12.1 (LTM), IT Services 450,738 448,464 446,675 Diversity: 436,641 • Women employees: 36.2% • Nationalities: 144 424,285 * Excluding Subsidiaries 417,929 Talent Development: • 37.7m Learning hours Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 • 335k+
Slide 20: Annexure
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Slide 21: IFRS Income Statement
IFRS Income Statement ` Million % of Revenue Consolidated IFRS Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Revenue 380,100 399,460 100.00 100.00 Cost of revenue 221,400 231,690 58.25 58.00 Gross margin 158,700 167,770 41.75 42.00 SG & A expenses 63,330 67,520 16.66 16.90 Operating income 95,370 100,250 25.09 25
Slide 22: COR – SG&A Details
COR – SG&A Details ` Million % of Revenue COR Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Employee cost 155,770 166,430 40.98 41.66 Fees to external consultants 28,850 30,970 7.60 7.75 Equipment and software 5,950 4,690 1.57 1.17 Facility expenses 7,320 4,300 1.92 1.08 Depreciation 4,310 7,280 1.13 1.83 Travel
Slide 23: Cash Flow Summary
Cash Flow Summary IFRS in ` Mn Q4 FY19 Q4 FY20 Net Cash from Operations 80,080 88,090 Capital Expenditure 6,760 7,410 Free Cash Flow 73,320 80,680 Dividends Paid 15,580 73,120 Operating Cash Flow to Sales (%) 21.1 22.1 Operating Cash Flow to Net Profit (%) 98.6 109.4 Total Cash and Investments 496,4
Slide 24: IFRS Income Statement
IFRS Income Statement ` Million % of Revenue Consolidated IFRS FY19 FY20 FY19 FY20 Revenue 1,464,630 1,569,490 100.00 100.00 Cost of revenue 851,580 923,220 58.15 58.83 Gross margin 613,050 646,270 41.85 41.17 SG & A expenses 238,550 260,470 16.28 16.59 Operating income 374,500 385,800 25.57 24.58 O
Slide 25: COR – SG&A Details
COR – SG&A Details ` Million % of Revenue COR FY19 FY20 FY19 FY20 Employee cost 605,530 656,520 41.36 41.83 Fees to external consultants 106,860 125,000 7.29 7.97 Equipment and software 22,700 19,050 1.55 1.21 Facility expenses 29,840 17,980 2.04 1.15 Depreciation 16,490 26,870 1.13 1.71 Travel 23,3
Slide 26: Cash Flow Summary
Cash Flow Summary IFRS in ` Mn FY19 FY20 Net Cash from Operations 316,670 353,910 Capital Expenditure 21,320 30,880 Free Cash Flow 295,350 323,030 Dividends Paid 114,720 377,020 Buy Back (incl. expenses) 160,450 - Operating Cash Flow to Sales (%) 21.6 22.5 Operating Cash Flow to Net Profit (%) 100.6
Slide 27: IFRS Statement of Financial Position
IFRS Statement of Financial Position 31-Mar-19 31-Mar-20 Consolidated IFRS ` Million % ` Million % Assets Property and equipment 116,500 9.95 119,380 9.71 Right-of-use Assets - - 79,940 6.50 Intangible assets and Goodwill 40,130 3.43 41,330 3.35 Accounts Receivable 274,410 23.44 306,060 24.88 Unbill
Slide 28: IFRS Income Statement – In USD
IFRS Income Statement – In USD $ Million % of Revenue Consolidated IFRS Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Revenue 5,397 5,444 100.00 100.00 Cost of revenue 3,144 3,158 58.25 58.00 Gross margin 2,253 2,286 41.75 42.00 SG & A expenses 899 920 16.66 16.90 Operating income 1,354 1,366 25.09 25.10 Other in
Slide 29: COR – SG&A Details – In USD
COR – SG&A Details – In USD $ Million % of Revenue COR Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Employee cost 2,212 2,268 40.98 41.66 Fees to external consultants 410 422 7.60 7.75 Equipment and software 84 64 1.57 1.17 Facility expenses 104 59 1.92 1.08 Depreciation 61 100 1.13 1.83 Travel 83 72 1.53 1.33 C
Slide 30: IFRS Income Statement – In USD
IFRS Income Statement – In USD $ Million % of Revenue Consolidated IFRS FY19 FY20 FY19 FY20 Revenue 20,913 22,031 100.00 100.00 Cost of revenue 12,160 12,962 58.15 58.83 Gross margin 8,753 9,069 41.85 41.17 SG & A expenses 3,406 3,655 16.28 16.59 Operating income 5,347 5,414 25.57 24.58 Other income
Slide 31: COR – SG&A Details – In USD
COR – SG&A Details – In USD $ Million % of Revenue COR FY19 FY20 FY19 FY20 Employee cost 8,647 9,216 41.36 41.83 Fees to external consultants 1,525 1,755 7.29 7.97 Equipment and software 325 268 1.55 1.21 Facility expenses 426 252 2.04 1.15 Depreciation 236 377 1.13 1.71 Travel 333 322 1.59 1.46 Com
Slide 32: IFRS Statement of Financial Position in USD
IFRS Statement of Financial Position in USD 31-Mar-19 31-Mar-20 Consolidated IFRS $ Million % $ Million % Assets Property and equipment 1,685 9.95 1,583 9.71 Right-of-use Assets - - 1,060 6.50 Intangible assets and Goodwill 581 3.43 547 3.35 Accounts Receivable 3,969 23.44 4,057 24.88 Unbilled Reven
Slide 33: Ind AS Income Statement - Consolidated
Ind AS Income Statement - Consolidated ` Crore % of Revenue Consolidated Ind AS Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Revenue 38,010 39,946 100.00 100.00 Expenditure a) Employee Costs 20,179 22,051 53.09 55.20 b) Cost of equipment and software licences 595 469 1.57 1.17 c) Other Operating expenses 7,162 6
Slide 34: Ind AS Income Statement - Consolidated
Ind AS Income Statement - Consolidated ` Crore % of Revenue Consolidated Ind AS FY19 FY20 FY19 FY20 Revenue 146,463 156,949 100.00 100.00 Expenditure a) Employee Costs 78,246 85,952 53.42 54.76 b) Cost of equipment and software licences 2,270 1,905 1.55 1.21 c) Other Operating expenses 26,441 26,983
Slide 35: Ind AS Balance Sheet - Consolidated
Ind AS Balance Sheet - Consolidated ` Crore % Consolidated Ind AS 31-Mar-19 31-Mar-20 31-Mar-19 31-Mar-20 ASSETS Property, plant and equipment 11,553 12,130 10.05 10.03 Right-of-use assets - 7,994 - 6.61 Investments 29,330 26,356 25.52 21.80 Deferred tax assets (net) 2,656 2,828 2.31 2.34 Goodwill (
Slide 36: Currency mix and average realized rates in INR
Currency mix and average realized rates in INR Average rates % of Revenue Currency Q4 FY19 Q4 FY20 YoY Q4 FY19 Q4 FY20 USD 70.43 73.38 4.18% 53.13% 52.93% GBP 92.37 92.66 0.31% 14.25% 14.12% EUR 79.64 80.20 0.71% 10.13% 10.95% Others 22.49% 22.00% Total 100.00% 100.00%
Slide 37: Thank You
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