Hexaware Technologies (HEXT) Q4 2004 earnings summary

Executive summary

• FY04 global revenue reached $120.8M, up 65% YoY in dollar terms; 82% of business came from repeat customers.

• Added 38 clients, taking the active base to 107; 35 customers were Global/Fortune 500 and 25 billed over $1M annually.

• Six multi-year, multi-million-dollar contracts were won in H2; a strong order book supported plans for continued expansion.

Financial highlights

• Consolidated software and consultancy revenue was Rs 5,458.91M, up 61.04% YoY; total income was Rs 5,575.26M vs Rs 3,537.13M.

• Consolidated PAT was Rs 637.36M, up 123.11% YoY; profit before tax was Rs 723.58M vs Rs 299.90M.

• EBITDA rose 96.75% to Rs 884.65M from Rs 449.63M, supported by productivity, improved billing rates and cost rationalization.

• Basic/diluted EPS was Rs 27.57/Rs 25.15 vs Rs 14.76/Rs 13.65 in FY03.

• Recommended dividend was 50% (Rs 5/share), vs 20% (Rs 2/share) in FY03; proposed payout Rs 117.21M plus Rs 15.30M dividend tax.

Outlook and guidance

• FY05 revenue estimate: $170M, growth of 40%; net profit estimate: $25.2M, growth of 80%.

• Growth priorities included customer acquisition and retention, expanding Top 20 account wallet share, and investments in Australia and the Netherlands.

• Expected revenue drivers included BFSI, Transportation and PeopleSoft; plans also emphasized major turnkey IT projects and a judicious onsite-offshore mix.