Tata Consultancy Services Limited · NSE:TCS
Tata Consultancy Services — Q4 FY2007 Earnings Presentation
33 slides from Tata Consultancy Services's earnings presentation, Apr 16, 2007
Slide 1: Results for Quarter IV FY 2006-07
Results for Quarter IV FY 2006-07 16 April 2007
Slide 2: Disclaimer
Disclaimer Certain statements in this release concerning our future growth prospects are forward- looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties rel
Slide 3: Highlights
Highlights • Strong Quarter to finish off a great year • US $ 4.3B in Revenues • US $ 1.1B in Operating Income • North America crosses US $ 2B and Europe US$ 1B in Revenues • Client portfolio strengthened with large multi year, multi million deals • Two 50M+ deals and one 35M+ deal were closed this
Slide 4: Financial Performance
Financial Performance 16 April 2007 4
Slide 5: Indian GAAP Growth Summary - Annual
Indian GAAP Growth Summary - Annual Consolidated Indian GAAP (Rs. Crore) FY 2007 FY 2006 Income from IT & Consultancy Services 17,807 12,409 % Growth Y-o-Y 43.50% Total Income 18,685 13,264 % Growth Y-o-Y 40.87% PBIDT (before Other Income) 5,139 3,684 % Growth Y-o-Y 39.48% Profit After Tax 4,213 2,9
Slide 6: Indian GAAP Income Statement - Annual
Indian GAAP Income Statement - Annual Rs. Crore % of Total Income Consolidated Indian GAAP FY 2007 FY 2006 FY 2007 FY 2006 INCOME a) IT & Consultancy Services 17,806.60 12,408.68 95.30 93.55 b) Manufacturing, Sale of equipment and Licences 878.61 855.31 4.70 6.45 Total Income 18,685.21 13,263.99 100
Slide 7: Indian GAAP Growth Summary – Quarterly
Indian GAAP Growth Summary – Quarterly Consolidated Indian GAAP (Rs. Crore) Q4 FY07 Q3 FY07 Q4 FY06 Income from IT & Consultancy Services 4,950 4,641 3,490 % Growth Q-o-Q 6.66% % Growth Y-o-Y 41.84% Total Income 5,162 4,873 3,727 % Growth Q-o-Q 5.92% % Growth Y-o-Y 38.50% PBIDT (before Other Income)
Slide 8: Indian GAAP Income Statement – Consolidated – Q4 FY07
Indian GAAP Income Statement – Consolidated – Q4 FY07 Rs. Crore % of Total Income Consolidated Indian GAAP Q4 FY07 Q3 FY07 Q4 FY06 Q4 FY07 Q3 FY07 Q4 FY06 INCOME a) IT & Consultancy Services 4,950.29 4,641.36 3,490.16 95.90 95.24 93.64 b) Manufacturing, Sale of equipment and Licences 211.80 232.08 2
Slide 9: Indian GAAP Balance Sheet - Consolidated
Indian GAAP Balance Sheet - Consolidated Rs Crore % Consolidated Indian GAAP 31-Mar-07 31-Mar-06 31-Mar-07 31-Mar-06 Source of Funds Shareholders' Funds 8,850.10 5,998.81 91.80 94.81 Minority Interest 211.80 164.72 2.20 2.60 Loan Funds 506.75 116.69 5.26 1.84 Deferred Tax Liability 71.70 47.26 0.74
Slide 10: US GAAP Growth Summary – Annual
US GAAP Growth Summary – Annual Consolidated US GAAP (Rs Million) FY 2007 FY 2006 Revenue 186,332 132,454 % Growth Y-o-Y 40.7% Gross Margin 82,206 58,921 % Growth Y-o-Y 39.5% EBIDTA 50,740 36,703 % Growth Y-o-Y 38.2% Operating Income 46,444 33,894 % Growth Y-o-Y 37.0% Net Income 41,315 28,831 % Grow
Slide 11: US GAAP Income Statement - Annual
US GAAP Income Statement - Annual Consolidated US GAAP USD Million Rs Million % of Revenue FY2007 FY2007 FY2006 FY2007 FY2006 Revenue 4,286.45 186,332.12 132,454.44 100.00 100.00 Cost of revenue 2,395.36 104,126.13 73,532.96 55.88 55.52 Gross margin 1,891.09 82,205.99 58,921.48 44.12 44.48 SG & A ex
Slide 12: COR – SG&A Details - Annual
COR – SG&A Details - Annual Rs. Millions % of Revenue COR FY 2007 FY 2006 FY 2007 FY 2006 Employee Cost 82,657.09 56,900.90 44.36 42.96 Equipment & Software 6,783.25 7,421.11 3.64 5.60 Depreciation 2,912.03 1,931.22 1.56 1.46 Travel 2,531.27 2,354.20 1.36 1.78 Communication 1,526.11 1,184.52 0.82 0.
Slide 13: US GAAP Revenue Growth – Quarterly
US GAAP Revenue Growth – Quarterly Consolidated US GAAP (Rs Millions) Q4 FY07 Q3 FY07 Q4 FY06 Revenue from International Business 46,632 44,777 32,960 % Growth Q-o-Q 4.14% % Growth Y-o-Y 41.48% Revenue from Indian Business 4,832 3,828 4,273 % Growth Q-o-Q 26.22% % Growth Y-o-Y 13.07% Total Revenue 5
Slide 14: US GAAP Growth Summary – Quarterly
US GAAP Growth Summary – Quarterly Consolidated US GAAP (Rs Millions) Q4 FY07 Q3 FY07 Q4 FY06 Gross Margin 23,320 21,564 16,206 % Growth Q-o-Q 8.14% % Growth Y-o-Y 43.89% EBIDTA 14,568 13,752 9,830 % Growth Q-o-Q 5.93% % Growth Y-o-Y 48.20% Operating Income 13,173 12,673 8,965 % Growth Q-o-Q 3.94% %
Slide 15: US GAAP Income Statement - Quarterly
US GAAP Income Statement - Quarterly USD Millions Rs Millions % of Revenue Consolidated US GAAP Q4 FY07 Q4 FY07 Q3 FY07 Q4 FY06 Q4 FY07 Q3 FY07 Q4 FY06 Revenue 1,183.89 51,463.73 48,604.76 37,233.69 100.00 100.00 100.00 Cost of revenue 647.43 28,143.90 27,041.02 21,027.37 54.69 55.63 56.47 Gross mar
Slide 16: COR – SG&A Details - Quarterly
COR – SG&A Details - Quarterly Rs. Millions % of Revenue COR Q4 FY07 Q3 FY07 Q4 FY06 Q4 FY07 Q3 FY07 Q4 FY06 Employee Cost 21,906.96 21,681.85 16,690.14 42.57 44.61 44.83 Equipment & Software 1,669.50 1,521.08 1,898.27 3.24 3.13 5.10 Depreciation 967.36 747.43 579.71 1.88 1.54 1.56 Travel 796.61 645
Slide 17: US GAAP Balance Sheet
US GAAP Balance Sheet 31-Mar-07 31-Mar-06 Consolidated US GAAP Rs Millions % Rs Millions % Assets Cash and Cash equivalents 11,120.15 8.52 3,965.01 4.63 Accounts Receivable 43,090.44 33.00 32,789.78 38.29 Unbilled Revenues 7,834.80 6.00 4,712.30 5.50 Other Current assets 11,661.45 8.93 8,133.15 9.50
Slide 18: Operational Performance
Operational Performance 16 April 2007 18
Slide 19: Growth by Market
Growth by Market 4.9% 1.4% 9.4% North America • TCS is witnessing steady growth across all regions Ibero America 8.5% 51.1% UK • North American market continues Continental Europe to achieve growth and drive India offshore movement Asia Pacific 20.5% MEA • UK and Europe markets witness 4.2% steady p
Slide 20: Growth by Domain
Growth by Domain 7.9% 2.3% BFSI 3.2% • TCS is experiencing growth Manufacturing 41.3% across verticals. All our key 7.9% Telecom clients in BFSI, Telecom, Life Sciences & Healthcare Retail are steadily growing. 4.7% Retail & Distribution Transportation • TCS’ domain competency is 17.6% Energy & Util
Slide 21: Growth by Service Line
Growth by Service Line • TCS’ new services are driving 2.3% 6.0% Application Development & Maint. growth in our key clients 3.1% Business Intelligence 3.5% Engineering & Industrial Services • Remote Management of 12.3% Infrastructure Services Infrastructure offering is driving Enterprise Solutions n
Slide 22: Operational Parameters
Operational Parameters Revenue % Q4 FY07 Q3 FY07 FY07 FY06 Delivery Location* Onsite 54.1 54.3 55.7 62.6 GDC/RDC 4.6 4.1 3.8 Offshore 41.3 41.6 40.5 37.4 Contract Type Time & Material 59.8 59.0 58.7 50.2 Fixed Price & Time 40.2 41.0 41.3 49.8 * Excluding Domestic Clients 16 April 2007 22
Slide 23: Client Parameters
Client Parameters Client Concentration Q4 FY07 Q3 FY07 FY07 FY06 Clients Contribution * Revenue % Top 1 6.6 5.7 6.6 3.7 Top 5 18.5 17.4 18.5 17.0 Top 10 28.4 27.5 28.4 27.5 US$ 1 mln Clients 297 288 297 256 US$ 5 mln Clients 119 114 119 96 US$ 10 mln Clients 75 74 75 54 US$ 20 mln Clients 39 37 39 3
Slide 24: Client Acquisition and Expansion
Client Acquisition and Expansion Particulars Q4 FY07 Q3 FY07 FY07 FY06 Active Clients 780 754 920 929 New Clients 43 55 218 330 Revenue % from Repeat Business 94.9 96.1 96.8 95.2 Revenue % from New Business 5.1 3.9 3.2 4.8 16 April 2007 24
Slide 25: Client Delivery Highlights
Client Delivery Highlights • TCS improved the claims processing throughput of a North American Insurer by re-architecting their claims payment engine. • An integrated Billing and Customer Services Management solution was delivered for a large utility company in Europe. • TCS successfully deployed a
Slide 26: Representative Wins
Representative Wins • A leading Financial Institution has selected TCS to implement a program to achieve Basel II regulatory compliance and proactive capital and risk management. • A large North American airline has selected TCS to provide integrated BPO and IT services across revenue accounting and
Slide 27: Representative Wins
Representative Wins • A large European insurance major selected TCS to develop and execute a data integration strategy for their cross border acquisition. • A global investment bank has engaged TCS to drive a multi year productivity enhancement and cost of quality reduction initiative • TCS has been
Slide 28: Impact of Growth Engines
Impact of Growth Engines • Global Consulting, BPO, Infrastructure Management and Assurance Services contributed to 18% of FY 07 Revenues – up from 10% in FY06 • TCS’ Full Services play is validated - Four of the 12 large deals ($50+ M) won during FY07 were driven by strong infrastructure component a
Slide 29: Human Resources
Human Resources 16 April 2007 29
Slide 30: Total Employee Base: 89,419
Total Employee Base: 89,419 No. of TCS Employees: 85,582 No. of Employees with Indian subsidiaries (CMC, and WTI): 3,837 No. of Employees in overseas branches & subsidiaries: 8,320 No. of Employees in Global/Regional Delivery Centers : 2,995 3,837 3,745 3,835 3,660 85,582 3,648 79,755 74,193
Slide 31: FY 07 Q4 Gross additions 8,613 & Net additions 5,827
FY 07 Q4 Gross additions 8,613 & Net additions 5,827 • Added 3,843 Trainees and 2,918 Experienced Professionals in India • Added 1,852 employees in Overseas Subsidiaries and Branches • Utilization Rate was 79.64% (excluding trainees), 74.72% (including trainees) • Attrition rate for the Last Twelve
Slide 32: Truly Global Workforce
Truly Global Workforce Non-Indian nationals was 9.6%. Employees from across 67 nationalities. 26% of our workforce comprises women. 48% of our associates have more than 3 years of work experience. 9.6% Composition of International Workforce % of Non Indian Nationals in TCS Romanian, 0.40% Ot
Slide 33: Thank You
TATA CONSULTANCY SERVICES LI ZAN UZA\U ZAALIZAN LIZA LT ZA LZ LULA LIZA\LIZA\1 L/\\ IMU SINT Thank Y You. 16 April 2007
Tata Consultancy Services — Q4 FY2007 Earnings Presentation on 6ix