Tata Consultancy Services Limited · NSE:TCS
Tata Consultancy Services — Q4 FY2018 Earnings Presentation
35 slides from Tata Consultancy Services's earnings presentation, Apr 19, 2018
Slide 1: TCS Financial Results Quarter IV & Year Ended FY 2017-18
TCS Financial Results Quarter IV & Year Ended FY 2017 - 18 April 19, 2018 | Copyright © 2018 Tata Consultancy Services Limited 1
Slide 2: Disclaimer
Disclaimer Certain statements in this release concerning our future prospects are forward-looking statements. Forward-looking statements by their nature involve a number of risks and uncertainties that could cause actual results to differ materially from market expectations. These risks and uncertai
Slide 3: Quarterly Financial Performance
Quarterly Click Financial to edit Master Performance title style 3
Slide 4: Q4 FY18 Performance Highlights
Q4 FY18 Performance Highlights Revenue: - INR Revenue of ` 320,750 Mn, 3.8% QoQ and 8.2% YoY - USD Revenue of $ 4,972 Mn, 3.9% QoQ and 11.7% YoY - Constant currency revenue growth of 7.2% YoY, Volume growth of 8.5% YoY Profit: - Operating Income at ` 81,470 Mn, Operating Margin of 25.4% - Net In
Slide 5: Growth Summary (INR)
Growth Summary (INR) Revenue Y-0-Y Growth Q-0-Q Growth 320,750 8.2% 309,040 ` Million 305,410 296,420 295,840 4.2% 4.3% 3.2% 3.9% 3.8% 1.0% -0.2% -0.3% Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 1.2% Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Operating Income Operating margin (%) 81,470 76,270 77,810 25.7
Slide 6: Growth Summary (USD)
Growth Summary (USD) Revenue Y-o-Y Growth Q-o-Q Growth 4,972 11.7% 4,739 4,787 9.1% 4,591 8.3% $ Million 4,452 5.8% 5.2% 3.9% 3.1% 1.5% 1.0% 3.2% Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Operating Income Operating margin (%) 1,263 1,188 1,205 1,146 25.7% $ Mill
Slide 7: Annual Financial Performance
Annual Financial Performance 7
Slide 8: FY18 Performance Highlights
FY18 Performance Highlights Revenue: - INR Revenue of ` 1.23 Tn, growth of 4.4% YoY - USD Revenue of $ 19,089 Mn, growth of 8.6% YoY - Constant currency revenue growth of 6.7% Profit: - Operating Income at ` 305,020 Mn, Operating Margin of 24.8% - Net Income at ` 258,260 Mn, $ 4,005 Mn, Net Marg
Slide 9: Growth Summary
Growth Summary Summary ` Summary $ Revenue & Growth % Revenue & Growth % 1,179,660, 1,231,040, 8.6% 4.4% 19,089, 17,576, ` Million 6.2% 8.6% $ Million FY17 FY18 FY17 FY18 Operating Income & Margin % Operating Income & Margin % 303,240, 305,020, 4,730, 25.7% 24.8% 4,518, 25.7% 24.8% $ Million ` Milli
Slide 10: Operational Parameters
Operational Parameters 10
Slide 11: Growth by Market
Growth by Market Q-o-Q Y-o-Y YoY Geography (%) Q4 FY17 Q3 FY18 Q4 FY18 FY17 FY18 CC Growth CC Growth CC Growth Americas North America 53.3 52.0 50.2 0.2 4.9 54.0 51.6 3.7 Latin America 2.1 2.2 2.0 -7.8 5.0 2.1 2.1 7.8 Europe UK 13.7 14.1 15.2 6.3 10.7 13.9 14.3 8.6 Continental Europe 11.8 13.5 14.2
Slide 12: Growth by Domain
Growth by Domain Q-o-Q Y-o-Y YoY Vertical (%) Q4 FY17 Q3 FY18 Q4 FY18 FY17 FY18 CC Growth CC Growth CC Growth BFSI 32.9 32.1 31.5 0.4 2.9 33.4 32.3 3.2 Retail & CPG 12.3 12.5 12.3 0.8 8.4 12.9 12.2 1.5 Communication & Media 7.2 7.4 7.4 1.5 8.9 7.0 7.4 11.6 Manufacturing 7.3 7.5 7.4 0.6 8.6 7.3 7.4 9
Slide 13: Service Lines Commentary
Service Lines Commentary • Cloud & Cyber Security Services saw Digital Transformation Services strong double digit growth led by Cloud Migration & Modernisation, Excellent double digit growth powered by Identity & Access Management, IoT Cloud migration continued to be a top customer experience trans
Slide 14: Client Parameters
Client Parameters Clients Contribution Q4 FY17 Q3 FY18 Q4 FY18 FY17 FY18 US$ 1m+ Clients 897 941 963 897 963 US$ 5m+ Clients 459 485 495 459 495 US$ 10m+ Clients 310 337 350 310 350 US$ 20m+ Clients 190 203 207 190 207 US$ 50m+ Clients 84 94 97 84 97 US$ 100m+ Clients 35 37 38 35 38 14
Slide 15: Key Highlights
Key Highlights Consulting & Services Integration Cloud Services & Cyber Security TCS Interactive • Selected by a global biopharmaceutical company to use • Engaged with Mesosphere, a leading software firm from • Selected by a Finnish Insurance firm as a strategic artificial intelligence to scan throu
Slide 16: Human Resources
Click Human to edit Resources Master title style 16
Slide 17: Total Employee Base
Total Employee Base Total Employees : 394,998 Attrition*: 394,998 • 11.0% (LTM), IT Services • 11.8% (LTM), including BPS 390,880 389,213 387,223 Diversity: 385,809 • Women employees: 35.3% • Nationalities: 131 378,497 * Excluding Subsidiaries Talent Development: • 5.6 M Learning days • 247k employe
Slide 18: Annexure
Click Annexure to edit Master title style 18
Slide 19: IFRS Income Statement
IFRS Income Statement ` Million % of Revenue Consolidated IFRS Q4 FY17 Q3 FY18 Q4 FY18 Q4 FY17 Q3 FY18 Q4 FY18 Revenue 296,420 309,040 320,750 100.00 100.00 100.00 Cost of revenue 166,730 178,620 185,240 56.25 57.80 57.75 Gross margin 129,690 130,420 135,510 43.75 42.20 42.25 SG & A expenses 53,420
Slide 20: COR – SG&A Details
COR – SG&A Details ` Million % of Revenue COR Q4 FY17 Q3 FY18 Q4 FY18 Q4 FY17 Q3 FY18 Q4 FY18 Employee cost 117,400 125,560 131,350 39.61 40.63 40.95 Fees to external consultants 19,200 20,870 22,820 6.48 6.75 7.11 Equipment and software 7,050 7,490 5,330 2.38 2.42 1.66 Facility expenses 5,510 6,670
Slide 21: Cash Flow Summary
Cash Flow Summary IFRS in ` Mn Q4 FY17 Q3 FY18 Q4 FY18 Net Cash from Operations 77,330 77,880 83,990 Capital Expenditure 5,100 3,770 3,590 Free Cash Flow 72,230 74,110 80,400 Dividends Paid 15,260 16,110 14,610 Operating Cash Flow to Sales (%) 26.1 25.2 26.2 Operating Cash Flow to Net Profit (%) 117
Slide 22: IFRS Income Statement
IFRS Income Statement ` Million % of Revenue Consolidated IFRS FY17 FY18 FY17 FY18 Revenue 1,179,660 1,231,040 100.00 100.00 Cost of revenue 668,870 712,880 56.70 57.91 Gross margin 510,790 518,160 43.30 42.09 SG & A expenses 207,550 213,140 17.60 17.31 Operating income 303,240 305,020 25.70 24.78 O
Slide 23: COR – SG&A Details
COR – SG&A Details ` Million % of Revenue COR FY17 FY18 FY17 FY18 Employee cost 462,020 503,500 39.17 40.90 Fees to external consultants 83,450 84,320 7.07 6.85 Equipment and software 28,080 27,000 2.38 2.19 Facility expenses 23,010 26,460 1.95 2.15 Depreciation 14,570 15,720 1.23 1.28 Travel 17,990
Slide 24: Cash Flow Summary
Cash Flow Summary IFRS in ` Mn FY17 FY18 Net Cash from Operations 276,070 281,660 Capital Expenditure 19,530 18,040 Free Cash Flow 256,540 263,620 Dividends Paid 109,730 107,600 Buy Back (Incl. expenses) - 160,420 Operating Cash Flow to Sales (%) 23.4 22.9 Operating Cash Flow to Net Profit (%) 105.0
Slide 25: IFRS Statement of Financial Position
IFRS Statement of Financial Position 31-Mar-17 31-Mar-18 Consolidated IFRS ` Million % ` Million % Assets Property and equipment 117,410 11.14 116,000 10.70 Intangible assets and Goodwill 37,680 3.58 38,960 3.59 Accounts Receivable 226,840 21.53 250,370 23.09 Unbilled Revenues 53,510 5.08 69,130 6.3
Slide 26: IFRS Income Statement – In USD
IFRS Income Statement – In USD $ Million % of Revenue Consolidated IFRS Q4 FY17 Q3 FY18 Q4 FY18 Q4 FY17 Q3 FY18 Q4 FY18 Revenue 4,452 4,787 4,972 100.00 100.00 100.00 Cost of revenue 2,504 2,767 2,871 56.25 57.80 57.75 Gross margin 1,948 2,020 2,101 43.75 42.20 42.25 SG & A expenses 802 815 838 18.0
Slide 27: COR – SG&A Details – In USD
COR – SG&A Details – In USD $ Million % of Revenue COR Q4 FY17 Q3 FY18 Q4 FY18 Q4 FY17 Q3 FY18 Q4 FY18 Employee cost 1,763 1,945 2,036 39.61 40.63 40.95 Fees to external consultants 288 323 354 6.48 6.75 7.11 Equipment and software 106 116 83 2.38 2.42 1.66 Facility expenses 83 103 108 1.86 2.16 2.1
Slide 28: IFRS Income Statement – In USD
IFRS Income Statement – In USD $ Million % of Revenue Consolidated IFRS FY17 FY18 FY17 FY18 Revenue 17,576 19,089 100.00 100.00 Cost of revenue 9,965 11,054 56.70 57.91 Gross margin 7,611 8,035 43.30 42.09 SG & A expenses 3,093 3,305 17.60 17.31 Operating income 4,518 4,730 25.70 24.78 Other income
Slide 29: COR – SG&A Details – In USD
COR – SG&A Details – In USD $ Million % of Revenue COR FY17 FY18 FY17 FY18 Employee cost 6,884 7,807 39.17 40.90 Fees to external consultants 1,243 1,307 7.07 6.85 Equipment and software 418 419 2.38 2.19 Facility expenses 343 410 1.95 2.15 Depreciation 217 244 1.23 1.28 Travel 268 291 1.52 1.52 Com
Slide 30: IFRS Statement of Financial Position in USD
IFRS Statement of Financial Position in USD 31-Mar-17 31-Mar-18 Consolidated IFRS $ Million % $ Million % Assets Property and equipment 1,811 11.15 1,784 10.70 Intangible assets and Goodwill 581 3.57 599 3.59 Accounts Receivable 3,498 21.53 3,849 23.09 Unbilled Revenues 825 5.08 1,063 6.38 Investmen
Slide 31: Ind AS Income Statement - Consolidated
Ind AS Income Statement - Consolidated ` Crore % of Revenue Consolidated Ind AS Q4 FY17 Q3 FY18 Q4 FY18 Q4 FY17 Q3 FY18 Q4 FY18 Revenue 29,642 30,904 32,075 100.00 100.00 100.00 Expenditure a) Employee Costs 15,692 16,458 17,183 52.94 53.25 53.57 b) Cost of equipment and software licences 705 749 53
Slide 32: Ind AS Income Statement - Consolidated
Ind AS Income Statement - Consolidated ` Crore % of Revenue Consolidated Ind AS FY17 FY18 FY17 FY18 Revenue 117,966 123,104 100.00 100.00 Expenditure a) Employee Costs 61,621 66,396 52.24 53.93 b) Cost of equipment and software licences 2,808 2,700 2.38 2.19 c) Other Operating expenses 21,226 21,492
Slide 33: Ind AS Balance Sheet - Consolidated
Ind AS Balance Sheet - Consolidated ` Crore % Consolidated Ind AS 31-Mar-17 31-Mar-18 31-Mar-17 31-Mar-18 ASSETS Property, plant and equipment 11,645 11,506 11.28 10.82 Investments 41,980 36,008 40.66 33.88 Deferred tax assets (net) 2,828 3,449 2.74 3.24 Goodwill (on consolidation) 1,597 1,745 1.55
Slide 34: Currency mix and average realized rates in INR
Currency mix and average realized rates in INR Average rates % of Revenue Currency Q3 FY18 Q4 FY18 QoQ Q3 FY18 Q4 FY18 USD 64.56 64.51 -0.08% 54.79% 53.32% GBP 85.87 90.51 5.41% 12.28% 13.10% EUR 76.22 79.74 4.62% 9.52% 10.21% Others 23.41% 23.37% Total 100.00% 100.00% 34
Slide 35: Thank You
Thank You IT Services Business Solutions Consulting
Tata Consultancy Services — Q4 FY2018 Earnings Presentation on 6ix