NIIT Limited · NSE:NIITLTD
NIIT — Investor Day (May 2011)
50 slides from NIIT's investor day presentation, May 11, 2011
Slide 1: Annual Investor Meet, Mumbai: May 11, 2011
Annual Investor Meet Mumbai: May 11, 2011 1
Slide 2: Agenda
Agenda Part I • Education & Training: Landscape • Company Overview – Individual Learning Solutions – School Learning Solutions – Corporate Learning Solutions Part II • FY11: Results Update • Sharpening The Edge 2
Slide 3: Education & Training: Landscape
EDUCATION & TRAINING: LANDSCAPE 3
Slide 4: Economic Outlook
Economic Outlook • Economic growth in most advanced economies (US, Europe, Japan) to remain anemic: Roubini (Jan, 2011) • Threat of rising sovereign risk and public debt • ‘LUV’ continues: Economic Recovery in Europe to be L shaped, U shaped in USA and V shaped in Emerging economies • Consumption tr
Slide 5: India: Long Term Outlook
India: Long Term Outlook Demographic Dividend • Young nation with 54% of population under 25 years of age • Trillion dollar economy expected to Growing Economy grow @ 7% - 8% pa • Expected to cross $27 Trillion in 2050 Global Workforce requirement • Global shortfall of 56 million by 2020 • India wil
Slide 6: Massive Gaps Exist In Access & Quality
Massive Gaps Exist In Access & Quality • Low workforce productivity • Low capacity for skills training • Acute skills shortage & unemployment • Low employability • Low coverage of vocational skills taught Education & Training will remain and important 6
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 100+ universities • Institutional Joint certification and dual Higher alliances models qualification programs Education • Global linkages IGNOU partnership for degree programs NIIT Inside solutions • Largest onl
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
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: 23% CAGR: 21% 1569 1593 11486 11993 12483 1186 10068 1036 7951 774 FY07 FY08 FY09 FY10 FY11 FY07 FY08 FY09 FY10 FY11 Dividend Payout CAGR: 16% ˃ Number of Shares Outstanding: 214 214 231 248* 143 165 million (FV of Rs 2 each) ˃ Last
Slide 15: Capital Structure
Capital Structure Total Capital employed – Rs. 9,253 million • No of Shares – 165.1 Mn • Face Value – Rs. 2 per share Secured Debt 29% Unsecured Reserves Debt 57% 11% Equity 3% Public, 27% Promoters, 34% Invest ments DMF and FI, 16% 10% Cash 7% Net Current Net Fixed FIIs, 29% Assets Assets* 18% 59%
Slide 16: Businesses
THE EDGE BUSINESSES
Slide 17: Individual Learning Solutions
INDIVIDUAL LEARNING SOLUTIONS 17
Slide 18: 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 19: 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 20: 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 21: 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 22: ILS: Our Reach
ILS: Our Reach • India : 599 Centers • China: 192 Centers • ROW: 159 Centers 22
Slide 23: School Learning Solutions
SCHOOL LEARNING SOLUTIONS 23
Slide 24: Schools: Opportunity Space
Schools: Opportunity Space • Teachers Training - 10 million Teachers 24x7 3,000 schools • Vocational Education - is an emerging Collaboration Portal area ERP 100,000 schools Math LAB & Science LAB IT Education Class Room 1 Mn schools Products and services for improving school education 24
Slide 25: SLS: Our Reach
SLS: Our Reach 9,591,463Students 396,449Teachers 107,209 Nodes 23,936 Hrs of Content 45,685 Private and Government Schools Instructors Private Schools 16,689 Schools NIIT has the widest reach in the market 25
Slide 26: 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 26
Slide 27: Corporate Learning Solutions
CORPORATE LEARNING SOLUTIONS 27
Slide 28: Corporate Training Market
Corporate Training Market US Corporate Training Spending 55.8 58.5 56.2 51.1 48.2 48.9 $Bn Global training spend $100Bn+ Source: IDC, Bersin & Associates 2005 2006 2007 2008 2009 2010 • Recovery underway as organizations move from crisis management to future planning • Increased share of E-Learning
Slide 29: Our Credentials
Our Credentials One of the 12000+ largest Person Years E-Learning 50,000 Hrs of 20,000+ Training of 150+ University Libraries e-Learning Days per Year Courses Experience 1500+ print 5800+ e-learning 285,000+ Student 20,000 Hours catalog library Learning Hours of ILT 1500+ Professionals: Largest Cont
Slide 30: Corporate Learning Solutions
Corporate Learning Solutions • 5800+ titles; 50,000+ topics Learning Products - • 4 Mn+ learners on Khub Online • SAAS model • Largest print library Print & Publishing • Over 8000 titles • Print on demand • Recurring revenues, long term partnerships Managed Training • Multi year, multi geography rel
Slide 31: 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 32: FY'11 Results Update
THE EDGE FY’11 RESULTS UPDATE
Slide 33: Environment
Environment Strong Indian economy. Rising Interest rates aimed at inflation control. Volatile capital flows. Strong hiring by employers across industries. Strongest hiring intentions since 2005 with Net Employment Outlook at 51% up 13 percentage points YoY (Manpower Employment Outlook Survey )
Slide 34: FY'11 – Financial Highlights
FY‟11 – Financial Highlights Consolidated System wide revenues ` 19,072 million ,up 6% YoY. Growth of 10% on a like to like basis* Net Revenues at ` 12,483 million, up 4% YoY. Growth of 9% on a like to like basis* EBITDA ` 1,593 million. EBITDA margin at 13%. Profit before Tax ` 557 million,
Slide 35: FY'11 - Awards & Recognitions
FY‟11 - Awards & Recognitions Element K wins the Brandon Hall Silver Excellence Award for blended learning NIIT (US) Accepts Honors for Learning and Talent Management Solution at Bersin Impact 2010 Conference NIIT (US) ranks amongst Top 10 Training & Learning Business Process Outsourcing Vendo
Slide 36: FY'11 - Consolidated Financials
FY'11 - Consolidated Financials (Rs. in mn) FY'11 FY'10 YoY (%) System wide Revenues 19,072 17,964 6% Net Revenues 12,483 11,993 4% Operating expenses 10,889 10,425 4% EBITDA 1,593 1,569 2% EBITDA% 13% 13% -32 bps Depreciation 854 751 14% Net Other Income -181 -329 148 mn Profit before Tax 557 488 1
Slide 37: FY'11 - Business Mix
FY'11 - Business Mix FY’10 FY’11 NB System Wide Revenues NB 2% 3% CLS % Change CLS 30% Individual +10% 31% ILS-IT Schools -26% ILS-IT 57% 58% SLS Corporate +8% SLS 11% New Biz +59% 8% EBITDA NB, NB, CLS, -152 -108 Change 437 CLS, ILS- Individual +7% 471 IT, ILS- 987 Schools -43% IT, SLS, 1061 296 Co
Slide 38: Individual - IT
Individual - IT ` Mn Q4'11 Q4'10 YoY FY'11 YoY System wide Revenues 3,118 2,929 6% 11,153 10% Net Revenues 1,221 1,144 7% 4,681 10% EBITDA 276 282 -2% 1,061 7% EBITDA % 23% 25% -207 bps 23% -43 bps Q4’11 Enrolments: Career enrollments up 19% YoY, Edgeineers up 33%; Overall enrolments up 12% Stro
Slide 39: School Learning Solutions
School Learning Solutions ` Mn Q4'11 Q4'10 YoY FY'11 YoY Net Revenues 374 321 16% 1,481 -26% EBITDA 28 74 -62% 169 -43% EBITDA % 8% 23% -1550 bps 11% -336 bps Q4’11 FY’11 196 Non Government schools added Strong addition of non-government schools (Signups up 94% YoY) (581), up 76% YoY; Total scho
Slide 40: Corporate Learning Solutions
Corporate Learning Solutions ` Mn Q4'11 Q4'10 YoY FY'11 YoY Net Revenues 1,526 1,393 9% 5,835 8% EBITDA 119 141 -16% 471 8% EBITDA % 8% 10% -233 bps 8% 1 bps Q4’11 Revenue contribution 56% 12% volume growth, driven by growth in MTS & Online 50% 44% LP+MT Learning Products 34% 33% 2 multi million
Slide 41: Individual - New Businesses
Individual - New Businesses ` Mn Q4'11 Q4'10 YoY FY'11 YoY System wide Revenues 150 112 34% 602 59% Net Revenues 117 92 28% 485 64% EBITDA -20 -22 -108 Q4’11 FY’11 Order Intake Rs. 116 million. Pending order book at Order Intake Rs. 529 million. Pending order book at Rs. 107 million Rs. 107 mill
Slide 42: Sharpening The Edge
THE EDGE SHARPENING THE EDGE
Slide 43: ILS: Realigning For Higher Growth
ILS: Realigning For Higher Growth • Started the year with lower order book • Launched new initiatives • New products to address changing preferences • New delivery model: Embedding VSAT based delivery, across centers and online portal to expand reach and increase efficiency • NIIT Inside: Separate t
Slide 44: SLS: Reprioritization Of Portfolio
SLS: Reprioritization Of Portfolio • Capital intensity of Government ICT contracts and delay in payments impacted returns NIIT took the following steps • Restricted participation in fresh ICT contracts along with aggressive receivables follow up • Increased attention on private schools – Increased s
Slide 45: CLS: Focus On Higher Margin Annuity Streams
CLS: Focus On Higher Margin Annuity Streams • Larger percentage of CLS was project based and therefore susceptible to economic volatility NIIT took the following steps • Focus on higher margin annuity based businesses – Learning Products: Invested in sales force and product development – Managed Tra
Slide 46: Skills Development: Emerging New Area For NIIT
Skills Development: Emerging New Area For NIIT India needs 500M people to be skilled by 2022; current capacity <5M p.a. National Skills Vocational Vocational Specialized Development Education Training Training Corporation 50M 175M 125M 150M • Only 3% (9,600 • Driven by Ministry. Of • Each ministry i
Slide 47: NIIT: Overall
NIIT: Overall NIIT’s core competencies, acquired over its 3 decades of existence, will remain foundational to its future Pedagogy Creation of quality learning materials Technology Distributed education process management Partnerships Building sustainable partnerships 47
Slide 48: NIIT: Overall Now…..
NIIT: Overall Leverage Capabilities developed to drive growth in all businesses • Low cost training centers – Then….. DLC CLC, DLC Now….. • Technology based delivery models – SLT (VSAT Based), V-Lab, Online portal • Learning libraries - EK, SLS CLC • „NIIT Inside‟ model; University partnerships NIIT
Slide 49: NIIT: Overall
NIIT: Overall 1. Quality of Revenues to improve Quality of revenues is improving with higher IP Led, annuity based, higher margin businesses – IP led revenue has improved from 43% in FY10 to 44% in FY11 – Total Pending Order book is up 20% YoY to $225 million – Order book >1 year at 53%, up from 48%
Slide 50: Leadership in the Century of the Mind
Leadership in the Century of the Mind 50