Slide 1: Investor Update Q2 2019
Investor Update Q2 2019 8th August 2019 © Hexaware Technologies. All rights reserved. | www.hexaware.com
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements on this presentation 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 un
Slide 3: Use of Non-GAAP Financials
Use of Non-GAAP Financials Hexaware has included non-GAAP financial measures in this presentation to supplement Hexaware’s consolidated financial statements presented on a GAAP basis. These non- GAAP financial measures may have limitations as analytical tools, and these measures should not be consid
Slide 4: Q2 2019 Business Update
Q2 2019 Business Update www.hexaware.com | © Hexaware Technologies. All rights reserved. 4
Slide 5: Key Highlights
Key Highlights Q2 Revenue Q2 EBITDA* Q2 EPS $ 188.5M 16.2% ₹ 5.08 • Q/Q growth of 4.7%; 5.0% in CC • Q2 EBITDA of $ 30.5M • Q/Q EPS growth of 9.2% • Y/Y growth of 12.0%; 13.0% in CC • EBITDA % expansion of 121 bps Q/Q and • Non GAAP EPS of ₹ 5.55; Q/Q growth 63 bps Y/Y of 19.3% NN Wins Closing Headc
Slide 6: Q2 19 | Financial Performance
Q2 19 | Financial Performance GROWTH GROWTH Amounts in US$ Mn Q2 2019 Q1 2019 Q2 2018 QoQ YoY Revenue 188.5 180.0 4.7% 168.3 12.0% EBITDA (before ESOP cost) 31.1 27.6 12.8% 27.6 12.6% EBITDA % 16.5% 15.3% 1.2% 16.4% 0.1% EBITDA (after ESOP cost) 30.5 27.0 13.2% 26.2 16.5% EBITDA % 16.2% 15.0% 1.2% 1
Slide 7: Revenue Walk | QoQ
Revenue Walk I QoQ $M 190 7.0 188.5 185 2.1 180.0 (0.5) 180 175 170 165 Q1 19 Forex Calendar Volume Q2 19 Increases Decreases www.hexaware.com | © Hexaware Technologies. All rights reserved. 7
Slide 8: EBITDA Walk | QoQ
EBITDA Walk | QoQ 18.0 % of revenue 0.7 17.0 0.6 16.2 16.0 0.5 (0.9) 0.9 15.0 15.0 0.4 (0.2) 14.0 (0.7) 13.0 12.0 Q1 19 Forex H1B Visa Calendar Bill Rates Mix Utilization Other SG&A Q2 19 costs * EBIDTA (post ESOP cost) Increases Decreases www.hexaware.com | © Hexaware Technologies. All rights reser
Slide 9: GAAP to Non-GAAP Results Reconciliation
GAAP to Non-GAAP Results Reconciliation Q2 ‘19 Q1 ’19 Q2 ’18 PBT Tax PAT EPS* EPS* ($M) ($M) ($M) (INR) (INR) Reported (GAAP numbers) 26.5 4.7 21.8 5.08 4.65 5.17 Q2 ‘19 GAAP EPS Change 0.43 (0.09) Non-GAAP Adjustments Transaction Cost 2.4 0.7 1.8 0.42 Amortization of intangibles 0.3 0.1 0.2 0.05 NP
Slide 10: Improved Depth of Customer Relationships
Improved Depth of Customer Relationships Q2 19 vs Q1 19 Top 20 accounts Q2 2018 Q2 2019 Contribution Revenue Top Clients Change QoQ Growth QoQ $50+ 3 3 $30 - $50 Top 5 Clients -0.02% 2.53% 0 0 $20 - $30 1 2 Top 10 Clients -0.41% 1.67% $10 - $20 6 6 Top 20 Clients -0.05% 2.48% $5 - $10 12 24 Q2 19 To
Slide 11: NN Wins
NN Wins USD 36 million NN Deal wins in Q2-19 Private Cloud Implementation for a managed healthcare company Guidewire Managed Testing for a European insurance company Customer Experience Transformation for a US-based housing company RPA and Accounts Payable Automation for a US-based grocery distribut
Slide 12: Employee Metrics
Employee Metrics UTILIZATION EMPLOYEE ATTRITION Uptick in Utilization Attrition maintained at steady rate 18.2% 18.2% 80.8% 80.9% 81.3% 80.7% 17.0% 79.7% 79.0% 78.7% 79.0% 78.2% 15.7% 14.4% 13.8% 13.7% 13.1% 13.4% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2017 2017 2017 2018 2018 2018 20
Slide 13: Q2 19 | Broad based growth across portfolio
Q2 19 | Broad based growth across portfolio APAC PS IMS 9.2% 14.9% 15.6% Europe 14.0% BFS BPS ADM M&C 8.0% 37.0% 39.8% 16.0% BIBA 12.3% North H&I America GTT DA ES 19.2% 10.1% 76.8% 17.7% 9.4% GROWTH GROWTH GROWTH GROWTH GROWTH GROWTH GEOGRAPHY VERTICAL HORIZONTAL QoQ YoY QoQ YoY QoQ YoY North Ameri
Slide 14: H1 '19 in Perspective
H1 ‘19 in Perspective Amounts in $ M H1 2019 H1 2018 YoY BFS 148.5 142.9 3.9% Other Verticals 220.0 187.6 17.3% Total 368.5 330.5 11.5% Guidance Update: • FY 19 revenue growth of ~19% (still within original guidance for organic growth) • EBITDA% in-line with revenue growth • Improved EPS due to lowe
Slide 15: Mobiquity Update
Mobiquity Update www.hexaware.com | © Hexaware Technologies. All rights reserved. 15
Slide 16: Mobiquity | Purpose & Services
Mobiquity | Purpose & Services Experience First • Digital Products & Services Design • Shoppable Experience, Personalization • Digital Ergonomics (Accessibility, Voice Enablement, Visual clues etc.) Transforming Customer Continuous Experience Experience Delivery Engineering • Commerce Management Tra
Slide 17: Analytics, Machine Learning and Personalization
Mobiquity | Purpose & Services From Analytics, Machine Learning and Personalization FRONT-END APPLICATIONS TO BACK-END Serverless Digital Engagement Platform Micro-services APIs DevOps SYSTEMS With scalable, adaptable and reusable Enterprise Systems architecture to ensure you are always ready to del
Slide 18: Mobiquity | Strong Partnerships
Mobiquity | Strong Partnerships AMAZON WEB SERVICES • AWS Premier Consulting Partner, among top tier of AWS Relevant work partners globally • Official AWS re:Invent mobile app • Recognized for digital engagement expertise • CloudWatch skill for Alexa for Business referenced during re:Invent keynote
Slide 19: Mobiquity | A Diverse Eco System of Capabilities
Mobiquity | A Diverse Eco System of Capabilities FRONT END FRAMEWORKS MARKETING CLOUD / CONTENT MOBILITY MANAGEMENT COMMERCE DIGITAL ASSET SEARCH MANAGEMENT CROSS-CHANNEL RICH MEDIA ANALYTICS / DTM RELATIONSHIP MARKETING, CAMPAIGN MANAGEMENT SOCIAL & COLLABORATION CRM … & Custom systems, providers e
Slide 20: Finance Update
Finance Update www.hexaware.com | © Hexaware Technologies. All rights reserved. 20
Slide 21: Revenue
Revenue 188.5 USD M Key Highlights 180.0 176.1 171.1 168.3 ❑ Q2’19 revenue of $ 188.5 M ▪ Q/Q growth of 4.7%, 5.0% in CC ▪ Y/Y growth of 12.0%, 13.0% in CC Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 ❑ Q2’19 revenue of INR 13,083 M Q/Q 3.8% 1.6% 3.0% 2.2% 4.7% Y/Y 10.3% 11.1% 12.8% 10.9% 12.0% ▪ Q/Q growth of 3.5
Slide 22: Outstanding Hedge Position and Rates
Outstanding Hedge Position and Rates Outstanding Hedge Position Avg Rate Q2'19 Currency Pair Q3'18 Q4'18 Q1'19 Q2'19 Amount M USDINR ($) 70.81 71.83 72.93 73.54 197.20 EURNR (€) 86.91 88.22 89.08 89.57 6.18 GBPNR (£) 97.16 98.70 99.11 99.27 13.08 Total ($M) 220.83 Note - 1. Hedges outstanding are fu
Slide 23: Forex Gain/(Loss)
Forex Gain/(Loss) USD M 4.3 • Q2’19 registered a forex gain of 3.3 $1M 1.7 • Forex Gains expected in next 1.0 1.1 two quarters basis Q2 closing exchange rate of INR 69.02 per USD are: Q2’18 Q3’18 Q4’18 Q1’19 Q2’19 Q3’19F Q4’19F ▪ Q3’19 ~ $ 1.7 M ▪ Q4’19 ~ $1.1 M -1.2 -3.6 www.hexaware.com | © Hexawa
Slide 24: Mobiquity Accounting Update
Mobiquity Accounting Update US$ M Deal consideration (incl. deferred & earnout) 181.9 Deal consideration application towards: Net Assets acquired 14.7 Intangibles 36.5 Deferred tax liability (9.8) Goodwill 140.5 www.hexaware.com | © Hexaware Technologies. All rights reserved. 24
Slide 25: Balance Sheet & Other Updates
Balance Sheet & Other Updates Cash Balance ($M) DSO (days) 83 81 75 74 77 119.5 125.9 108.4 58 60 100.6 54 51 47 Billed Unbilled 28 25 21 23 23 Total 25.0* Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 *Cash balance after payment towards acquisition Dividend (INR per share) Effective T
Slide 26: Hexaware Analyst Meet 2019 is scheduled for 23rd September in Mumbai
Hexaware Analyst Meet 2019 is scheduled for 23rd September in Mumbai. We look forward to meeting you there! www.hexaware.com | © Hexaware Technologies. All rights reserved. 26
Slide 27: Thank you
Innovative Services Passionate Employees Thank you www.hexaware.com Delighted Customers www.hexaware.com | © Hexaware Technologies. All rights reserved. 27