Hexaware Reports 2012 Results - Largest Focus Vertical BFS Grows 28% Y-o-Y

Mumbai - 11 February 2013

CY 2012 Highlights

  • CY 2012 revenues up 34% in INR terms and 18% in $ terms
  • EBIT margin up 280 basis points Y-o-Y in CY 2012; EBIT up 56% Y-o-Y
  • Diluted EPS increased to INR 10.9 per share; Dividend: INR 5.4 per share
  • Global Headcount increased to 9,069 at the end of December 2012; 752 employees added during the year

Q4 2012 Highlights

  • Q4 2012 revenue was at $ 92.4 mn; in-line with the revised quarterly revenue guidance of $ 92.0 mn
  • Q4 2012 Gross margin was at 36.1%
  • 11 new clients added in Q4 2012; 47 in CY 2012 cutting across all focus areas
  • Attrition for the quarter ended December 2012 was at 8.7%; down from 13.9% for the same period a year ago

Hexaware Technologies Limited, a leading global provider of IT, BPO and Consulting services has reported in-line performance for the fourth quarter of the calendar year ended December 31, 2012.

“In line with the Dividend policy announced in 2011, Hexaware Board has decided to continue with the liberal dividend policy and the Company intends to distribute approximately 50% of the net profits (Profit after Tax) as dividend. Given the financial strength as well as the evident growth prospects, dividend will continue to be declared every quarter” remarked Atul Nishar, Chairman, Hexaware Technologies Limited.

“With the investments made to strengthen our competencies and expansion of our field force strength in accordance to our Strategic Plan, we remain confident of delivering double digit revenue growth for the year 2013. Further, with multiple cost levers at hand, we believe operating margin expansion will commence immediately in Q1 2013 and continue going forward. For Q1 2013, on a constant currency basis, we expect operating margin to expand 150 – 200 basis points Q-o-Q sequentially” stated P. R. Chandrasekar, CEO & Vice Chairman, Hexaware Technologies Limited.

Q1 2013 Revenue Guidance
Revenue for Q1 2013 is likely to be in the region of $ 94.0 mn - $ 95.0 mn (exchange rates taken at 1 £ = 1.58 $, 1 € = 1.34 $ and 1 $ = INR 53.52); a Q-o-Q sequential revenue growth of 1.7% - 2.8%.

Banking and Financial Services Vertical - Business Update
The largest focus vertical at Hexaware grew by 28% Y-o-Y in CY 2012 in spite of the prevalent conditions. With the extensive specialization in certain niche areas of Capital Markets segment, especially Asset Management, Hexaware is in a position to add value to its several clients through its differentiated services and innovative solutions.

The business growth was aided by Hexaware’s proprietary work in developing Intellectual Property Assets around Enterprise Data Management (EDM). The service offering was further augmented with the launch of Analytics for Investment Management (AIM) tool kit. The current version, EDM 3.0, is a multifaceted offering that includes Technology & Business Architecture consulting, Multi product niche such as Eagle, GoldenSource, CADIS, Integrated IT and BPO services, Specialized Accelerators, Processes, Methodologies, and Approach for addressing common data issues in Capital Markets Industry. AIM is a prebuilt repository of dashboards, KPIs and reports supported by a dimensional data model for Investment reporting for a 360 degree view of the Portfolios and Assets under Management (AUM) they manage, in conjunction with the Trades, Performance and Risk related thereto. This highly domain intensive solution has been extremely well received by multiple existing clients and several new clients during the year 2012.

Spurred by the innovation & solutions developed at the Centers of Excellence (CoE) around certain product platforms, this Vertical is well positioned to deliver yet another year of above company growth for the year 2013; continuing with the strong relative outperformance reported in the year 2012.

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