Slide 1: Investor Update Q1 2016
Passionate Employees Investor Update Innovative Services Q1 2016 Delighted Customers Launching RAISE IT TM 5 May 2016 © 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: Business Update
Business Update © Hexaware Technologies. All rights reserved. | www.hexaware.com 3
Slide 4: Key Financials for Q1 2016
Key Financials for Q1 2016 GROWTH GROWTH Q1 2016 Q4 2015 QoQ YoY Revenue 121.69 124.11 -2.0% 5.9% EBITDA* 18.91 19.85 -4.8% -8.4% (before ESOP Cost) EBITDA 17.82 19.73 -9.7% -12.8% (after ESOP Cost) PAT 12.56 14.68 -14.5% -6.3% EPS Diluted ** 2.77 3.27 -15.3% 0.5% * Excludes ESOP Cost of $1.09 M in
Slide 5: Revenue Analysis - QoQ
Revenue Analysis - QoQ -2.2% Volume Growth 125.00 124.1 124.00 123.00 USD Mn---------------> (1.01) 122.00 0.45 121.7 0.18 121.00 (1.84) (0.19) 120.00 Increases 119.00 Decreases 118.00 Bill Rates Volume Mix Calendar Revenue Q4 15 Revenue Q4 15 FX - © Hexaware Technologies. All rights reserved. | www
Slide 6: EBITDA Margin Walk - QoQ
EBITDA Margin Walk - QoQ • EBITDA margin for the quarter was 15.5%( Excludes ESOP cost), 50 bps lower than last quarter • Gross margin for Q1 2016 at 34.5%; lower by 30 bps mainly due to following reasons 35.00 34.8 0.41 34.5 34.50 0.22 0.54 34.00 %---------------------> (0.89) (0.16) 0.33 33.50 Inc
Slide 7: Movement of Top Customers
Movement of Top 20 Customers Top 20 Accounts by Revenue for the Quarter (instead of LTM) Q1 2016 vs. Q4 2015 IN OUT Global Banking and Multinational Insurance Financial Services Firm © Hexaware Technologies. All rights reserved. | www.hexaware.com 7
Slide 8: Strategy Proof Points
Strategy Proof Points Q1-16 NN Deal wins at USD 36 million Automation led Multi-year Multi-million Procurement, Automation Finance and HR Shared Services deal for a global logistics company Multi-year Multi-million Digital Transformation deal for a Digital top ten pharmacy benefit manager and provid
Slide 9: Improved Depth of Customer Relationships
Improved Depth of Customer Relationships Q4 2015 Q1 2016 CLIENT CONTRIBUTION GROWTH TO REVENUE QoQ $50+ 1 1 Top 5 Clients -1.1% $30 - $50 3 3 Top 10 Clients -1.7% $20 - $30 0 0 Top 20 Clients -2.0% $10 - $20 5 5 $5 - $10 7 6 $1 - $5 53 58 >$1 69 73 Last twelve months revenue © Hexaware Technologies.
Slide 10: Shareholder Metrics
Shareholder Metrics RETURN ON EQUITY TOTAL SHAREHOLDER RETURNS Stock price as at the end of each quarter 31% 312.6 28% 269.2 255.5 247.6 25% 25% 243.5 22% Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 DIVIDEND PAYOUT Dividend declared for the year 11.10 8.65 6.95 2.
Slide 11: Employee Metrics
Employee Metrics UTILIZATION EMPLOYEE ATTRITION Range Bound Significant efforts taken to contain attrition 73.6% 17.1% 17.4% 73.0% 16.6% 16.9% 72.1% 16.0% 70.8% 14.1% 70.3% 70.4% 13.0% 69.7% 69.6% 12.7% Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q
Slide 12: North America led YoY Growth
North America led YoY Growth GROWTH GROWTH Europe, GEOGRAPHY 13% APAC, 5% QoQ YoY North America -1.0% 7.5% Europe -5.9% 1.7% APAC -6.5% -7.2% North America, TOTAL -2.0% 5.9% 82% While reporting the earnings for quarter ending March 31, 2016 (Q1 2016), Hexaware had provided a growth distribution Q1 2
Slide 13: Banking & Financial Services led Growth
Banking & Financial Services led Growth GROWTH GROWTH VERTICAL QoQ YoY Manufacturing & Banking & Financial Consumer, 28% Services, 39% Banking & Financial 2.5% 10.9% Services Global Travel & -9.3% -1.6% Transportation Healthcare & Insurance -1.1% 18.8% Healthcare & Manufacturing & -4.1% -2.9% Insura
Slide 14: Business Intelligence & Analytics led Growth
Business Intelligence & Analytics led Growth GROWTH GROWTH HORIZONTAL QoQ YoY Application Development & -2.6% 6.7% Maintenance (ADM) BPS, 6% IMS, 7% ADM, 38% Enterprise Solutions (ES) -5.9% -6.4% BIBA, 15% Quality Assurance & Testing -4.0% 3.0% Services (QATS) Business Intelligence & Analytics 6.3%
Slide 15: Awards & Recognition
Awards & Recognition • Hexaware has yet again proven its leadership in the Business Process Outsourcing industry by winning 5 awards at the recently concluded ‘Asia Outsourcing Congress & Awards 2015-16’. The Company received the recognitions and awards in the following categories: • Fastest Growing
Slide 16: RAISE IT
RAISE IT Run-Automated-Informed-Secured-Enterprise IT © Hexaware Technologies. All rights reserved. | www.hexaware.com 16 1
Slide 17: "RAISE IT" – Unified e2e IT Automation Platform
“RAISE IT” – Unified e2e IT Automation Platform Build IT Operate IT On-Demand Provisioning/ Deployment, CI/ CD, Multi-tenant Agile Architecture Intelligent Monitoring, Intelligence Grid, 40% reduction in Infrastructure Build AI, Machine Learning, Cognitive activities Knowledge, Robotic Process/ Work
Slide 18: How do we deliver? – Operate IT
How do we deliver ? – Operate IT Run Automated Informed Secured Enterprise IT Discover Reporting Knowledge & Best Practice Automatic Discovery Application- Live Dashboard Build-Your- Engine Infrastructure Map Application to Own-Analytics (BYOA), Knowledge Articles Industry Best Practice Infrastructu
Slide 19: RAISE IT Benefits
RAISE IT Benefits Focus is on Application down visibility : Application to Disk mapping for all Visibility applications. Increase prevention of outages by at least 20% in Year 1 through early Outage anomaly detection via machine learning Prevention Dramatically drop lapsed time from response to Reso
Slide 20: Financial Update
Financial Update © Hexaware Technologies. All rights reserved. | www.hexaware.com 20
Slide 21: Revenue
Revenue Q1 2016 constant currency revenue at $121.8 mn; down 1.8% QoQ; up 6.5% YoY Q1 Revenue at $121.7 mn; down 2.0% QoQ; up 5.9% YoY © Hexaware Technologies. All rights reserved. | www.hexaware.com 21
Slide 22: Revenue
Revenue Q1 Revenue at ` 8,202 mn; up 0.1% QoQ; up 15.0% YoY © Hexaware Technologies. All rights reserved. | www.hexaware.com 22
Slide 23: Outstanding Hedge Position and Rates
Outstanding Hedge Position and Rates Outstanding Hedge Position Currency Pair Amount (Mn.) Avg. Rate USDINR ($) 147.01 70.68 EURNR (€) 5.00 77.95 GBPNR (£) 4.20 106.69 Total ($) 158.75 Note - 1.Hedges outstanding are full-term hedges. 2. EUR converted @ 1.1380/USD & GBP converted @ 1.4410/USD. 3. Av
Slide 24: Forex Gain/(Loss)
Forex Gain/(Loss) 0.80 Total Gain/(Loss) 0.68 0.66 • Forex gain of $0.63 Mn this 0.63 quarter as against a gain of 0.60 $0.68 Mn in Q4’15. USD Mn-----------> • Forex gain expected ~ $ 0.66 0.40 Mn in Q2’16 and ~$ 0.68 Mn in Q3’16 at exchange rate of INR 66.2550/USD. 0.20 - Q1'16 Q2'16 Q3'16 © Hexawa
Slide 25: Balance Sheet Updates
Balance Sheet Updates CASH & CASH EQUIVALENTS Cash and Cash Equivalents* at US$ 46.47 M (INR 3079 M) DAYS SALES OUTSTANDING Days Sales Outstanding (DSO) for Q1 2016 at 49 days; 78 days including unbilled DIVIDEND INR 2.50 per share (125%) Dividend Payout including taxes INR 908.1 mn ($ 13.71 Mn) © H
Slide 26: Capex 2015
Capex 2015 USD K Q1-16 Item Actual Siruseri 5,247 Pune Hinjewadi 1,456 Computers & Equipments & Others 2,388 Grand Total 9,091 Overall Likely Capex Spend for 2016 – $ 40 mn ( Rs 268 crs ) Tax: ETR @24.2% vs. 21.0 % in Q4 due to higher profit in SEZ © Hexaware Technologies. All rights reserved. | www
Slide 27: Thank you
Passionate Employees Innovative Thank you Services Delighted Customers © Hexaware Technologies. All rights reserved. | www.hexaware.com