Mindtree Limited. Earnings release Fourth quarter ended March 31, 2018 (NSE: MINDTREE, BSE: ) April 18, 2018

Transcription

1 Mindtree Limited (NSE: MINDTREE, BSE: ) Earnings release Furth quarter ended March 31, 2018 April 18, 2018

2 Cntents 1. Press Release 3 2. Key Financial Metrics 7 3. Key Ratis 7 4. Key Revenue Metrics 8 5. Effrt and Utilizatin 9 6. Key Client Metrics 9 7. Key Emplyee Metrics Infrastructure Statutry Financials 11 Earnings Cnference Call fr Analysts / Investrs April 18, 2018 (6:30 PM IST) Primary Number: (The number listed abve is universally accessible frm all netwrks and all cuntries) Lcal Access Number: Available in - Ahmedabad, Bangalre, Chandigarh, Chennai, Gurgan (NCR), Hyderabad, Kchi/Cchin, Klkata, Lucknw, Pune Accessible frm all carriers. Tll free numbers: Singapre: Hng Kng: UK: US: Replay f cnference call available until April 30, (Playback id: #) Webcast Participants have the ptin t attend the cnference call by lgging in t the nline webcast, please nte participants in webcast wuld be in listen-nly mde. The webcast link is as belw. Mindtree Q4 FY18 Webcast Link Transcript will be available n after April 20, 2018 Mindtree 2018 Page 2 f 13

3 Mindtree Reprts Strng Furth Quarter and Year End Results Multiple large-deal wins pwer grwth, sets the trend fr FY19 Bangalre (India) and Warren (NJ), April 18, 2018: Mindtree, a glbal technlgy services and Digital transfrmatin cmpany, guiding it s clients t achieve faster business utcmes, annunced its cnslidated results tday fr the furth quarter and year ended March 31, 2018 as apprved by its bard f directrs. We ended the year n a strng nte, and seeing that mmentum creating a healthy start t ur new fiscal year. It s especially heartening that ur client satisfactin ratings reached an alltime high, setting the benchmark in ur industry. Rstw Ravanan, CEO & Managing Directr, Mindtree. Our enduring strategic investments in expertise fr Dmain, Digital and Run are clearly recgnized by the market. The further success f ur large deal fcus reflects the need fr Glbal 2000 businesses t marry large scale with agility. Mindtree is in that sweetspt. Key financial highlights: Quarter ended March 31, 2018 In USD: Revenue at $226.2 millin (grwth f 5.5% q--q / 15.6% y--y) Net prfit at $28.2 millin (grwth f 27.9% q--q/ 95.2% y--y) In INR: Revenue at 14,640 millin (grwth f 6.3% q--q / 11.1% y--y) Net prfit at 1,822 millin (grwth f 28.8% q--q / 87.5% y--y) Year ended March 31, 2018 In USD terms: Revenue at $846.8 millin (grwth f 8.6%) Net prfit at $88.4 millin (grwth f 41.8%) In Rupee terms: Revenue at 54,628 millin (grwth f 4.3%) Net prfit at 5,701 millin (grwth f 36.2%) Mindtree 2018 Page 3 f 13

4 Other highlights: Clients: 338 active clients as f March 31, 2018 $25 millin clients grw by 1, ttal f 4 $10 millin clients grw by 2, ttal f 17 $5 millin clients grw by 1, ttal f 38 $1 millin clients grw by 4, ttal f 118 Peple: 17,723 Mindtree Minds as f March 31, 2018 Trailing 12 mnths attritin is 12.5% BOTs*: Autmatin is playing a significant rle in mdernizing ur technlgy service delivery, enhancing bth efficiency and speed-t-results fr ur clients. We are prud t reprt ur BOTs strength that autnmusly wrk alng-side ur Mindtree Minds, enabling ur team t d mre and accmplish larger gals. We have 335 BOTs emplyed as f March 31, 2018 *Sftware that acts autnmusly, free frm any interference, human r therwise, t perfrm a significant task which will therwise be perfrmed by a human Multi-year and multi-millin dllar wins with leading glbal clients: Mindtree was awarded its largest single cntract t date by an existing custmer, in the airline industry in the USA. Under this cntract, Mindtree has been given the full wnership f the QA functin and is wrking with the client t radically redefine the QA functin Fr a partner and an existing custmer in the enterprise sftware prduct segment, Mindtree extended its presence int the Infrastructure Management area with a differentiated value prpsitin and was awarded a multi-year, multi-millin dllar pprtunity Prviding cutting-edge analytics using SAP HANA t deliver custmer insights fr a large autmtive cmpany in the UK Mindtree 2018 Page 4 f 13

5 An existing airline client in the USA has chsen Mindtree as a strategic partner t supprt applicatin develpment, maintenance and quality assurance services, as part f their IT transfrmatin initiative Awards and Recgnitin: Awarded the 2018 Adbe Experience Business Award fr excellence in Omni-channel Experience Management Annuncements The Bard f Directrs at its meeting held n April 18, 2018, have declared an interim dividend f 20% ( 2 per equity share f par value 10 each) and recmmended a final dividend f 30% ( 3 per equity share f par value 10 each) which is subject t apprval f sharehlders. Mindtree 2018 Page 5 f 13

6 Abut Mindtree Mindtree [NSE: MINDTREE] delivers digital transfrmatin and technlgy services frm ideatin t executin, enabling Glbal 2000 clients t utperfrm the cmpetitin. Brn digital, Mindtree takes an agile, cllabrative apprach t creating custmized slutins acrss the digital value chain. At the same time, ur deep expertise in infrastructure and applicatins management helps ptimize yur IT int a strategic asset. Whether yu need t differentiate yur cmpany, reinvent business functins r accelerate revenue grwth, we can get yu there. Visit t learn mre. Safe harbur Certain statements in this release cncerning ur future grwth prspects are frward-lking statements, which invlve a number f risks, and uncertainties that culd cause ur actual results t differ materially frm thse in such frward-lking statements. We d nt undertake t update any frward-lking statement that may be made frm time t time by us r n ur behalf. Visit us at Fr mre infrmatin, cntact: INDIA Divya Jain Value360 Cmmunicatins UNITED STATES Erik Arvidsn Matter Cmmunicatins Divya@value360india.cm earvidsn@matternw.cm EUROPE Susie Wyeth Htwire +44 (0) susie.wyeth@htwireglbal.cm Mindtree Limited, Glbal Village, RVCE Pst, Mysre Rad, Bangalre ; CIN: L72200KA1999PLC025564; Phne: ; Fax: ; inf@mindtree.cm/investrs@mindtree.cm; Website: Mindtree 2018 Page 6 f 13

7 Key Financial Metrics Q4 Q3 Q4 Grwth (%) ( millin) FY2017 FY2018 FY2018 Q--Q Y--Y Revenue 13,181 13,777 14, % 11.1% EBITDA 1,869 2,074 2, % 26.0% Net Prfit 972 1,415 1, % 87.4% Diluted EPS (Rs.) % 92.0% Q4 Q3 Q4 Grwth (%) ($ millin) FY2017 FY2018 FY2018 Q--Q Y--Y Revenue % 15.6% EBITDA % 31.2% Net Prfit % 95.2% Q4 Q3 Q4 Rupee Dllar Rate FY2017 FY2018 FY2018 Perid Clsing rate Perid Average rate Hedges utstanding at 31-Mar-18 Currency Value Avg. Rate/INR USD EURO GBP Ttal hedges utstanding in USD terms is 41M at an average rate f These are fair value hedges expiring within 30-June-18. Key Ratis Q4 Q3 Q4 Key Ratis FY2017 FY2018 FY2018 EBITDA Margin (%) 14.2% 15.1% 16.1% Effective Tax Rate (%) 22.8% 15.2% 27.3% Net Prfit Margin (%) 7.4% 10.3% 12.4% ROCE (%) 19.8% 24.4% 34.9% DSO (Days) Effective Tax Rate = Tax / PBT ROCE = EBIT / Average Capital Emplyed. ROCE is annualized Key Perfrmance Highlights Cntract Clsures crssed $1 Billin during FY 18 Last Twelve Mnths attritin rate at 12.5%, the lwest since Q3 FY14 In FY18 - Digital Business grew 18.9%; Infrastructure Management and Tech Supprt grew 16.7%; Technlgy, Media & Services grew by 10.8%; Travel and Hspitality grew by 10.1% Mindtree 2018 Page 7 f 13

8 Key Revenue Metrics Revenue by Gegraphy Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 US 69.8% 69.7% 71.0% Eurpe 20.8% 20.9% 21.1% India 2.8% 3.2% 3.2% Rest f the Wrld 6.6% 6.2% 4.7% Ttal 100.0% 100.0% 100.0% Revenue by Industry Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Technlgy, Media and Services 37.5% 36.6% 37.6% BFSI 24.7% 24.8% 22.5% Retail, CPG & Manufacturing 23.0% 23.3% 24.0% Travel & Hspitality 14.9% 15.3% 15.9% Ttal 100.0% 100.0% 100.0% Revenue by Service Offering Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Develpment 21.4% 24.5% 25.5% Engineering 9.5% 9.1% 9.1% Maintenance 18.3% 16.6% 15.7% Cnsulting 4.0% 4.0% 3.9% Package Implementatin 12.6% 11.3% 11.2% IP Led Revenue 1.3% 0.9% 0.9% Independent Testing 12.5% 12.6% 12.7% Infrastructure Management & Tech Supprt 20.4% 21.1% 21.0% Ttal 100.0% 100.0% 100.0% Digital 39.6% 43.9% 45.0% Revenue by Prject Type Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Fixed Cst, Fixed Mnthly 52.8% 56.4% 56.8% Time & Materials 47.2% 43.6% 43.2% Ttal 100.0% 100.0% 100.0% Revenue Mix Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Effrt Onsite 24.4% 22.9% 22.8% Offshre 75.6% 77.1% 77.2% Ttal 100.0% 100.0% 100.0% Revenue Onsite 60.5% 57.9% 58.9% Offshre 39.5% 42.1% 41.1% Ttal 100.0% 100.0% 100.0% Mindtree 2018 Page 8 f 13

9 Effrt and Utilizatin Metrics Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Q--Q Y--Y Billed Hurs Onsite 1,440,240 1,402,667 1,504, % 4.5% Offshre 4,469,309 4,713,836 5,088, % 13.9% Ttal 5,909,548 6,116,503 6,593, % 11.6% Fee Revenue ($ 000) Onsite 117, , , % 12.5% Offshre 76,457 89,183 92, % 20.5% Ttal 193, , , % 15.7% Utilizatin Including Trainees 70.9% 72.8% 73.8% Excluding Trainees 72.7% 74.3% 75.2% Utilizatin is calculated as Billed Hurs by Available Hurs. Available hurs des nt exclude leave hurs. Grwth (%) Key Client Metrics Metrics Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Client Details Number f Active clients New Clients Added $1 mn clients $5 mn clients $10 mn clients $25 mn clients $50 mn clients $100 mn clients Millin Dllar Clients are based n trailing 12 mnths revenue. Client Cntributin t Revenue Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Tp Client 14.3% 16.6% 17.8% Tp 5 Clients 30.7% 31.6% 32.0% Tp 10 Clients 41.9% 43.7% 43.7% Revenue frm Repeat Business 98.7% 98.2% 99.1% Cntributin t revenues is based n revenues fr the quarter. Ttal Cntract Value signed(tcv) (USD M) Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Renewals New Ttal Expiring within 1 year Expiring > 1 year Digital Mindtree 2018 Page 9 f 13

10 Key Emplyee Metrics Mindtree Minds Q4 FY 2017 Q3 FY 2018 Q4 FY 2018 Ttal Mindtree Minds 16,470 17,200 17,723 Sftware Prfessinals 15,413 16,068 16,595 Sales Supprt Grss Additins ,102 Net Additins Attritin (Last Twelve Mnths) 15.1% 12.6% 12.5% Wmen emplyees 29% 30% 30% Natinalities* *Natinalities represent the cunt f cuntries t which Mindtree minds belng t. BOTs* *A BOT is defined as a sftware that acts autnmusly, free frm any interference, human r therwise, t perfrm a significant task which will therwise be perfrmed by a human. This is a new metric being intrduced effective this quarter Infrastructure Cmpleted Available fr Expansin As f Mar 31, 2018 Built up area (sq ft 000) N. f Seats Built up area (sq ft 000) N. f Seats Bangalre 1,286 12, Chennai 294 2, Pune 149 1, Hyderabad Bhubaneswar Ttal 1,917 17, Nte: Land available fr expansin acres in Bhubaneswar. Mindtree 2018 Page 10 f 13

11 Audited Cnslidated Financial Results fr the Quarter and Year Ended March 31, 2018 ( in millins, except per share data) Particulars Quarter ended Year ended March 31, 2018 December 31, 2017 March 31, 2017 March 31, 2018 March 31, 2017 Revenue frm peratins 14,640 13,777 13,181 54,628 52,364 Other incme, net (refer nte 6) , Ttal incme 15,231 13,836 13,314 56,530 52,917 Expenses Emplyee benefits expense 9,301 8,946 8,700 35,641 34,125 Finance csts Depreciatin and amrtisatin expense ,715 1,858 Other expenses 2,984 2,757 2,840 11,582 11,194 Ttal expenses 12,726 12,168 12,055 49,107 47,368 Prfit befre tax 2,505 1,668 1,259 7,423 5,549 Tax expense Current tax ,555 1,577 Deferred tax (112) 167 (214) Net prfit fr the perid 1,822 1, ,701 4,186 Other cmprehensive incme: A. (i) Items that will nt be reclassified t prfit r lss (4) 7 4 (23) (14) (ii) Incme tax relating t items that will nt be reclassified t prfit r lss 1 (1) (1) 5 3 B. Items that will be reclassified t prfit r lss 58 (59) (237) 146 (610) Ttal ther cmprehensive incme 55 (53) (234) 128 (621) Ttal cmprehensive incme fr the perid 1,877 1, ,829 3,565 Paid up equity share capital (face value Rs. 10/- each) 1,639 1,639 1,680 1,639 1,680 Reserves 25,775 24,241 24,091 25,775 24,091 Earnings per share: Basic EPS (Rs.) Diluted EPS (Rs.) AUDITED SEGMENT WISE REVENUE AND RESULTS Particulars Quarter ended Year ended March 31, 2018 December 31, 2017 March 31, 2017 March 31, 2018 March 31, 2017 Segment revenue Retail, CPG and Manufacturing 3,437 3,210 3,032 12,689 12,476 Banking, Financial Services and Insurance 3,319 3,413 3,250 13,255 12,882 Technlgy, Media and Services 5,556 5,049 4,939 20,467 19,235 Travel and Hspitality 2,328 2,105 1,960 8,217 7,771 Ttal 14,640 13,777 13,181 54,628 52,364 Segment results Retail, CPG and Manufacturing ,663 1,493 Banking, Financial Services and Insurance ,245 1,153 Technlgy, Media and Services 1, ,441 3,671 Travel and Hspitality , Ttal 2,355 2,074 1,869 7,405 7,181 Unallcable Expenses ,715 1,994 Finance csts Other incme , Prfit befre tax 2,505 1,668 1,259 7,423 5,549 Ntes n segment infrmatin Principal segments The Grup is structured int fur industry verticals Retail, CPG and Manufacturing (RCM), Banking, Financial Services and Insurance (BFSI), Technlgy, Media and Services (TMS) and Travel and Hspitality (TH). Accrdingly, the Grup has presented its segment results under these business segments. Segment assets and liabilities Segregatin f assets, liabilities, depreciatin and ther nn-cash expenses int varius business segments has nt been carried ut as the assets are used interchangeably between segments. Accrdingly, n disclsure relating t segment assets and liabilities has been made. Mindtree 2018 Page 11 f 13

12 Audited Cnslidated Financial Results fr the Quarter and Year Ended March 31, 2018 ( in millins, except per share data) Particulars ASSETS As at March 31, 2018 March 31, 2017 Nn-current assets Prperty, plant and equipment 3,509 3,809 Capital wrk in prgress Gdwill 4,539 4,470 Other intangible assets 1,520 1,941 Financial assets Investments Lans Other financial assets Deferred tax assets (net) Other nn-current assets 1,547 1,326 12,334 13,296 Current assets Financial assets Investments 7,206 5,869 Trade receivables 10,155 8,962 Cash and cash equivalents 3,289 2,508 Lans Other financial assets 3,081 2,225 Other current assets 1,283 1,034 25,031 20,610 TOTAL ASSETS 37,365 33,906 EQUITY AND LIABILITIES Equity Equity share capital 1,639 1,680 Other equity 25,775 24,091 27,414 25,771 Liabilities Nn-current liabilities Financial liabilities Brrwings 9 13 Other financial liabilities Other nn current liabilities Current liabilities Financial liabilities Brrwings 3, Trade payables 1,710 1,651 Other financial liabilities 1,812 2,638 Other current liabilities 1,802 1,126 Prvisins 1,218 1,105 Current tax liabilities (net) ,857 7,821 9,951 8,135 TOTAL EQUITY AND LIABILITIES 37,365 33,906 Ntes t audited cnslidated financial results fr the quarter and year ended March 31, The abve results were reviewed by the Audit Cmmittee and thereafter have been adpted by the Bard at its meeting held n April 18, The Bard f Directrs at its meeting held n April 18, 2018, have declared an interim dividend f 20% (Rs 2 per equity share f par value Rs 10 each) and recmmended a final dividend f 30% (Rs 3 per equity share f par value Rs 10 each) which is subject t apprval f sharehlders. 3 Bard changes during quarter ended March 31, 2018 are as belw: i) V.G.Siddhartha resigned as the Nn-Executive Directr f the Cmpany with effect frm March 09, ii) Prf. Pankaj Chandra retired as the Independent Directr f the Cmpany with effect frm April 01, iii) Manisha Girtra resigned as the Independent Directr f the Cmpany with effect frm April 18, EPS fr the quarterly perids are nt annualized. 5 Audited financial results f Mindtree Limited (Standalne Infrmatin) Particulars Quarter ended Year ended March 31, 2018 December 31, 2017 March 31, 2017 March 31, 2018 March 31, 2017 Revenues 14,281 13,442 12,683 53,250 50,396 Prfit befre tax 2,581 1,815 1,379 7,943 5,844 Prfit after tax 1,913 1,568 1,066 6,249 4,460 Nte: The audited results f Mindtree Limited fr the abve mentined perids are available in the investrs sectin in and als with the stck exchanges where it is listed. The infrmatin abve has been extracted frm the audited financial statements as stated. 6 During the year ended March 31, 2018, the Grup has written back earn ut payable twards acquisitin f business t the erstwhile sharehlders f Bluefin Slutins Limited, Relatinal Slutins Inc. and Magnet 360 LLC amunting t Rs The statement f cnslidated financial results have been audited by the Cmpany's auditrs. The Cmpany's auditrs have issued an unmdified audit pinin n the cnslidated financial results. The audit reprt has been filed with the stck exchanges and is als available n the Cmpany's website. Mindtree 2018 Page 12 f 13

13 Fr mre infrmatin please cntact: Sushanth Pai Mindtree Limited Safe Harbr: Certain statements in this release cncerning ur future grwth prspects are frward-lking statements, which invlve a number f risks, and uncertainties that culd cause ur actual results t differ materially frm thse in such frwardlking statements. We d nt undertake t update any frward-lking statement that may be made frm time t time by us r n ur behalf.