Alldigi Tech (ALLDIGI) Q4 12/13 earnings summary

Executive summary

• FY13 consolidated income rose 72% to Rs 3,242.3m; EBITDA reached Rs 405.7m and PAT turned positive at Rs 19.5m from a Rs 169.8m loss.

• Standalone income fell 14% to Rs 1,109.9m, while the net loss narrowed 77% to Rs 33.3m; management attributed the improvement to cost reduction and a focus on profitable contracts.

Financial highlights

• Consolidated revenue from operations was Rs 3,200.7m versus Rs 1,831.4m; other income was Rs 41.6m versus Rs 54.3m.

• Standalone services income fell 14% to Rs 1,074.8m; EBITDA improved to Rs 73.7m from a loss of Rs 32.8m, and PAT loss narrowed to Rs 33.3m from Rs 147.0m.

• Consolidated PAT after minority interest was Rs 19.5m versus a loss of Rs 169.8m; finance costs rose to Rs 51.7m from Rs 7.8m.

• Standalone exports rose 24% to Rs 507.5m, while domestic revenue declined 32% to Rs 567.3m; payroll services revenue increased 26% YoY.

• A one-time Rs 43m bad-debt write-off followed settlement of an aged Rs 64m receivable for about Rs 21m; management said cost savings outweighed revenue declines.

Outlook and guidance

• Management expects growth in US and UK business and substantial profitability improvement, while citing good traction in US and domestic markets and potential from subsidiaries.

• Payroll services, supported by investment in a new technology platform, were expected to deliver a significant revenue increase in the next year.

• Indian BPM industry growth was forecast at 12–15% for FY14; management noted global IT-BPM spending was expected to grow over 5% in 2013.