NIIT Limited · NSE:NIITLTD
NIIT — Investor Presentation (May 2010)
61 slides from NIIT's investor presentation, May 10, 2010
Slide 1: Investor Meet Mumbai: May 10, 2010
Investor Meet Mumbai: May 10, 2010 1
Slide 2: Agenda
Agenda • Education & Training: Landscape • Company Overview – Individual Learning Solutions – School Learning Solutions – Corporate Learning Solutions • Year 2009-10 • Future Direction 2
Slide 3: Education & Training: Landscape
EDUCATION & TRAINING: LANDSCAPE 3
Slide 4: India's Demographic Dividend
India‟s “Demographic Dividend” Median Age Proportion Of Working Age 40 Group 37 34 64.8 65.0 25 63.5 64.2 62.6 61.6 59.9 India China UK USA 2005 2010 2015 2020 2025 2030 2035 Working Age Group Population (Mn) India China UK USA • Young population 923 994 918 • India to have the largest working 846 7
Slide 5: Education & Training In India: The Challenge
Education & Training In India: The Challenge Drop Out Rates By Level Of School Education 100% -26% 38% -24% -12% Initial Class I-V Class VI-VIII Class IX-X High School Enrolment Gross Enrolment Ratio (GER) In Tertiary 100% Education 76% 59% 30% 23% 12% USA Norway UK Brazil China India Source: Planni
Slide 6: Education & Training In India: The Challenge
Education & Training In India: The Challenge No of illiterates (Mn) 396 79 73 89 0 3 8 18 Botswana Colombia India Mexico Pakistan Indonesia Bangladesh China Source: UNDP HDR:2009 Percentage with Formal Vocational Training 96 75 80 64 68 36 22 28 5 Australia Botswana Colombia Germany India Japan Kore
Slide 7: Education & Training: The Emerging Environment
Education & Training: The Emerging Environment The Emerging Framework Planned Outcomes • National Skills 10,000 new vocational schools Skills Development Corporation 50,000 skill development Development • Target: vocational skills to centers 500 Mn people by 2022 Revamp of ITIs Public Privat
Slide 8: NIIT In The Emerging Environment
NIIT In The Emerging Environment NIIT’s Strengths Current Engagement • Long standing brand ILS: IT and Soft Skills • Best in class domain IFBI: Banking, Finance, Insurance Skills partnerships Uniqua: BPO/KPO Skills Development • Content creation Imperia: Management education capability English Plu
Slide 9: NIIT In The Emerging Environment
NIIT In The Emerging Environment NIIT’s Strengths Current Engagement Tie up with 60+ universities • Institutional Joint certification and dual Higher alliances models qualification programs Education • Global linkages IGNOU partnership for degree programs NIIT Inside solutions • Largest onli
Slide 10: NIIT: Market Leader with Strong Credentials
NIIT: Market Leader with Strong Credentials • One of the largest providers of vocational and professional skills worldwide across various service sectors. Acknowledged market leader in India • Leading player in the school education segment in India. Positioned to take strong advantage of the emergin
Slide 11: Company Overview
NIIT SHARPENING THE EDGE COMPANY OVERVIEW
Slide 12: IT Training To GTD
IT Training To GTD Training and IT Services CLS business Global Talent CAGR >50% + Development Key Competencies Company SLS Developed: - Pedagogy - Management of ILS distributed delivery Acquisition of EK process, - Partnerships Launch of IFBI & Imperia Pioneered Demerger of Launch of NEP Franchisin
Slide 13: Servicing The Full Labor Supply Chain
Servicing The Full Labor Supply Chain School Learning Individual Learning Corporate Learning Solutions Solutions Solutions Target Audience School children Young adults Working professionals Value Proposition Academics Employability Productivity Customer School Individual Corporate • IT Training • On
Slide 14: NIIT: Last 5 Year Financial Track Record
NIIT: Last 5 Year Financial Track Record Rs Mn Revenue EBITDA CAGR: 28% 11,486 11,993 CAGR: 27% 1,569 10,068 1,186 7,951 1,036 603 774 4,507 FY06 FY07 FY08 FY09 FY10 FY06 FY07 FY08 FY09 FY10 Dividend Payout ˃ Number of Shares Outstanding: 165 million (FV of Rs 2 each) 214 214 231 143 ˃ Last Bonus, S
Slide 15: Capital Structure
Capital Structure Total Capital employed – Rs. 9,110 Mn • No of Shares – 165.1 Mn • Face Value – Rs. 2 per share Secured Debt 28% Reserves 52% Unsecured Debt 16% Equity 4% Public, 34% Promoters, 34% Invest ments Cash 12% 7% DMF and FI, 4% FIIs, 28% Net Fixed Net Current Assets* Assets 69% * Includin
Slide 16: Businesses
NIIT SHARPENING THE EDGE BUSINESSES
Slide 17: Individual Learning Solutions
INDIVIDUAL LEARNING SOLUTIONS 17
Slide 18: ILS - Opportunity Space
ILS - Opportunity Space Total Working Professionals 19m 19.2m Working Target Pros 2m 2.3m Non- Tech Graduates Tech 0.4m 2.9m 3.3m Non-Tech Tech Students Students Students 13.6m 11.7m 1.9m Employability training is a huge opportunity 18
Slide 19: ILS: Our Reach
ILS: Our Reach • India : 558 Centers • China: 192 Centers • ROW: 159 Centers 19
Slide 20: Individual Learning Solutions-IT Training
Individual Learning Solutions-IT Training • Improving individual employability in IT Sector • Career, Career-edge and skills upgrade courses for Technology Partnerships* individuals • For Engineers, Science / Arts /Commerce graduates, working professionals • Instructor-led, supplemented by e-learnin
Slide 21: IFBI - Finance, Banking & Insurance Training
IFBI - Finance, Banking & Insurance Training • Career, Career-edge and Skills upgrade courses for individuals IFBI: Partnerships* • For graduates and working professionals • Instructor-led, supplemented by e-learning *Selected Creating job ready professionals for banking, insurance & financial servi
Slide 22: NIIT Imperia - Management Education
NIIT Imperia - Management Education • Executive management education for individuals • Career upgrade courses for working professional Imperia: Partnerships* • Synchronous learning delivery model • Instructor-led, supplemented by e-learning *Selected Enhancing reach of quality management education 2
Slide 23: NIIT Uniqua - Business Process Training
NIIT Uniqua - Business Process Training • Joint venture between Genpact & NIIT Partnerships* • Career, skills upgrade courses • Offers training to meet the growing requirement for professionals skilled in business/knowledge process outsourcing sectors *Selected Creating skilled workforce for the ITE
Slide 24: NIIT English Plus
NIIT English Plus • Aimed at rural and semi - urban youth of India • Provide basic English and professional life skills • Embedded modules on professional life skills • Effective learning through „Immersive Learning‟ methodology • Personal Digital Tutor for learning outside the classroom hours Engli
Slide 25: Training.com
Training.com • Courses in IT, sales, finance, banking, design, leadership, project management, professional development, European languages Self-Paced Virtual • Global online and hybrid delivery Courses Labs • Anytime, anywhere access • 24X7 delivery support system • Online mentors, forums/communiti
Slide 26: School Learning Solutions
SCHOOL LEARNING SOLUTIONS 26
Slide 27: Schools: Opportunity Space
Schools: Opportunity Space • Teachers Training - 10 million Teachers 24x7 3,000 schools • Vocational Education - is an emerging Collaboration Portal area ERP Math LAB & Science LAB 100,000 schools IT Education Class Room 1 Mn schools Products and services for improving school education 27
Slide 28: SLS: Our Reach
SLS: Our Reach 8,825,713Students 364,029Teachers 92,438 Nodes 21,644 Hrs of Content 22,891Instructors 15,908 Schools NIIT has the widest reach in the market 28
Slide 29: NIIT eGuru solutions portfolio
NIIT eGuru solutions portfolio Interactive Class Room Math Lab Science Lab Quick School (ERP) Web & Multimedia curriculum Shared computing Widest range of offerings 29
Slide 30: Corporate Learning Solutions
CORPORATE LEARNING SOLUTIONS 30
Slide 31: Corporate Training Market
Corporate Training Market US Corporate Training Spending 55.8 58.5 56.2 51.1 48.2 Global training spend $100Bn+ $Bn • 14% decline in overall training spend in 2009 2005 2006 2007 2008 2009 • Outsourcing saw a lower decline, US: Spending On Outsourced as more companies chose to Training 16.8 outsourc
Slide 32: Our Credentials
Our Credentials Largest 12000+ e-Learning Person Years Content 50,000 Hrs of 20,000+ Training 150+ University of e-Learning Days per Year Courses Experience Library 1500+ print 3500+ e-learning 285,000+ Student 20,000 Hours catalog library Learning Hours of ILT 1500+ Professionals: Largest Content O
Slide 33: Corporate Learning Solutions
Corporate Learning Solutions • 3500+ titles; SAAS model Learning Products • 3.5 Mn+ learners on Khub (SAAS) • Largest print & eLearning library • Recurring revenues, long term partnerships Training • Multi year, multi geography relationships Outsourcing • Opportunities in India growth sectors •150+
Slide 34: Top three brands considered when choosing a learning vendor
What are the top three brands you think about when considering a vendor for learning products and services? Unaided; CLO Magazine 0 5 10 15 20 25 30 35 40 45 SkillSoft Element K Other / Proprietary Depends GeoLearning HBP / HMM Learn.com Accenture NIIT Ninth House SumTotal Adobe AMA ASTD DDI Kaplan
Slide 35: Year 2009-10
NIIT SHARPENING THE EDGE YEAR 2009-10
Slide 36: 2009-10: The Year That Was
2009-10: The Year That Was… Beginning Of Year Environment End Of Year Global economic turmoil; Signs of economic recovery, widespread fear of economic globally collapse Return of business confidence; Recessionary trends in many projections of robust recruitment economies; extreme risk aversi
Slide 37: NIIT's Initiatives In The Difficult Year
NIIT‟s Initiatives In The Difficult Year • Introduction of new product lines including hardware & networking, business intelligence, and ERP training to expand its market • Re-alignment of products with changing market demand, such as job focused short duration courses for ILS • Extended partnership
Slide 38: The Initiatives Led To Steady Improvement In Business Parameters
The Initiatives Led To Steady Improvement In Business Parameters ILS IT -Growth CLS-Margins 11% 11% 10% 7% 8% 8% 7% 0% Q1'10 Q2'10 Q3'10 Q4'10 Q1'10 Q2'10 Q3'10 Q4'10 Overall Margin Other lead indicators Improvement YoY (bps) 373 401 • Accelerating pace of enrolments 278 67 growth - H1: 7% , H2: 20%
Slide 39: Awards During The Year
53 Awards During The Year CIO 100 Award 2009 BCG 50 Local Dynamos Business Superbrands 2008 ICT Enabled School of the Year Civil Society / Development Agency Initiative of Best Learning Partner Award the Year The Best Green IT Project Government / Policy Initiative of the Year India’s Most Customer
Slide 40: FY'10: Consolidated Financials
FY‟10: Consolidated Financials (Rs. in mn) FY'10 FY'09 YoY (%) System wide Revenues 17,964 16,893 6% Net Revenues 11,993 11,486 4% Operating expenses 10,425 10,300 1% EBITDA 1,569 1,186 32% EBITDA% 13% 10% 275 bps Depreciation 751 647 16% Other Income -329 -45 -284 mn Profit before Tax 488 493 -1% T
Slide 41: FY'10: Financial Highlights
FY‟10: Financial Highlights • Consolidated System wide revenues Rs. 17,964 mn , up 6% YoY • Net Revenues at Rs. 11,993 mn, up 4% YoY • EBITDA Rs. 1,569 million; up 32% YoY, EBITDA margin at 13% improved by 275 bps YoY. • Net Profit Rs. 702 million • EPS of 4.3 per share; Board recommends dividend of
Slide 42: FY'10: Business Highlights
FY‟10: Business Highlights Individual: • Net revenues at Rs. 4,275 million; Up 7.4% YoY • EBITDA at Rs. 987 million, up 14%.EBITDA margin at 23%, up 136 bps YoY Schools: • Net revenues at Rs. 2,000 million, up 45% YoY • EBITDA at Rs. 296 mn, up 38% YoY Corporate: • Net Revenues at Rs 5,422 million •
Slide 43: FY'10: Business Highlights
FY‟10: Business Highlights • Individual Learning Solutions (ILS -IT): Enrolments grew 12% with 24% growth in Edgeineers range of programs and 64% in Infrastructure Management Services courses. Placements continued to be strong, taking the growth to 25%. • School Learning Solutions : 2,812 new school
Slide 44: Business Mix
Business Mix FY’09 FY’10 System wide revenues- up 6% New New busine busine ss % Corpo Corpo ss 3% Change rate 2% rate Individ 30% Individ 34% Individual 9% ual ual Schoo 55% Schools 45% Schoo 57% ls ls 8% Corporate -6% 8% FY’09 EBITDA – Up 32% FY’10 New New busine Corpo busine Change rate ss Corpo s
Slide 45: Individual - IT
Individual - IT Rs. Mn Q4'10 Q4'09 % G, YoY FY'10 % G, YoY System wide Revenues 2,929 2,662 10% 10,163 9% Net Revenues 1,144 1,035 11% 4,275 7% EBITDA 282 237 19% 987 14% EBITDA % 25% 23% 177 bps 23% 136 bps FY’10 Q4’10 SWR Geo Mix: India 58%, ROW 25%,China 17% Enrolments - Overall up18% YoY . I
Slide 46: School Learning Solutions
School Learning Solutions Rs. Mn Q4'10 Q4'09 % G, YoY FY'10 % G, YoY Net Revenues 321 442 -27% 2,000 45% EBITDA 74 80 -7% 296 38% EBITDA % 23% 18% 499 bps 15% -66 bps FY’10 Q4’10 Order Intake: Rs. 2,062 Mn 101 non Govt. schools added with an order Schools added: 2,812 (334 non Govt. schools in
Slide 47: Corporate Learning Solutions
Corporate Learning Solutions Rs. Mn Q4'10 Q4'09 % G, YoY FY'10 % G, YoY Net Revenues 1,393 1,481 -6% 5,422 -6% EBITDA 141 95 48% 437 139% EBITDA % 10% 6% 371 bps 8% 490 bps FY’10 CLS Volume Growth % YoY Online Learning Products business grew at 7% YoY 8.0% 6.0% 6.2% Order intake for the year at
Slide 48: New Businesses
New Businesses Rs. Mn Q4'10 Q4'09 % G, YoY FY'10 % G, YoY System wide Revenues 112 67 66% 379 -7% Net Revenues 92 50 82% 296 -11% EBITDA -22 -48 -152 FMT enrolments grew at 58% for the quarter, signaling an improving trend 14 more placement partners added by IFBI (Total: 24) 3 large BPO‟s adde
Slide 49: Future Direction
NIIT SHARPENING THE EDGE FUTURE DIRECTION
Slide 50: The Building Blocks For NIIT's Future Are In Place
The Building Blocks For NIIT‟s Future Are In Place • NIIT‟s core competencies • New capabilities • Macro Trends • Lead Business indicators 50
Slide 51: Foundation Of Core Competencies
Foundation Of Core Competencies NIIT‟s core competencies, acquired over its 3 decades of existence, will remain foundational to its future Pedagogy Creation of quality learning materials Management of distributed delivery of Technology education Partnerships Building sustainable partnerships 51
Slide 52: New Capabilities Added Will Propel Business Forward
New Capabilities Added Will Propel Business Forward • Learning libraries - EK, SLS Then….. DLC • New Delivery models – SLT, Now….. Vlabs • Online assessment systems • School Management System CLC • Online Learning Library • Low cost training centers – CLC, DLC • University partnerships • „NIIT Insid
Slide 53: Macro Trends & Business Indicators Are Favorable
Macro Trends & Business Indicators Are Favorable Trends Indicators • Accelerating GDP growth • Enrolments growth • Increased government • Growth in placements spending • Strong Order Book • Increasing profits of the corporate sector • Competitive wins • Indications of large hiring • Profitability im
Slide 54: A Renewed Focus On Growth
A Renewed Focus On Growth Expand Coverage • Expanded geographic coverage • Expanded Grow Horizontally demographic coverage e.g. Increase Depth District Learning • New Verticals and • New products - SAP, Centers, Segments addressed SAS, IBM • New Delivery • English Plus • New tie ups & Formats – • Tr
Slide 55: Increasing IP Led And Annuity Based Revenue, And Contribution From New Businesses
Increasing IP Led And Annuity Based Revenue, And Contribution From New Businesses IP Led Revenue 43% • Non-linear revenue growth 37% 40% will support profit growth 2008 2009 2010 Portion of OB > 1 year • Increasing proportion of annuity based order book 42% 46% 52% 2008 2009 2010 FY10: Revenue & EBI
Slide 56: ILS - Future Direction
ILS - Future Direction Key Business Challenges • Although improved, decision making by potential students continues to be slow • Cost-effective growth of enrolments Business Outlook • Continued growth in IMS enrolments NIIT’s Initiatives and Responses • Entry into higher-end • Continued focus on IMS
Slide 57: SLS- Future Direction
SLS- Future Direction Key Business Challenges •Rapid scale up of private schools business •Capital requirement in government schools Business Outlook • Growth in GSA segment to remain strong NIIT’s Initiatives and Responses • Growth in Private •Selectivity in government schools business; schools on
Slide 58: CLS- Future Direction
CLS- Future Direction Key Business Challenges / Opportunities • Rapid scale up of e-Learning Products business • Softness in Custom Content development and in Print & Publishing • IT companies looking at outsourcing customer Business Outlook education in Europe and APAC • e-Learning Products, NIIT’s
Slide 59: New Business- Future Direction
New Business- Future Direction Key Business Challenges • Leveraging Recruitment plans of Banks, Insurance Companies and BPO Companies into student enrolment through cost-effective customer acquisition Business Outlook • Expected to recover further on the back of NIIT’s Initiatives and Responses stro
Slide 60: Summarizing
Summarizing • The emerging environment for Education and Training presents a huge opportunity • NIIT is strongly positioned to take advantage of the emerging opportunities • Our current businesses and competencies are aligned to attractive markets • We have a strong financial track record, and in th
Slide 61: Leadership In The Century Of The Mind
Leadership In The Century Of The Mind 61