NIIT (NIITLTD) Q4 17/18 earnings summary

Executive summary

• FY18 consolidated revenue rose 1% to Rs 8,505m; EBITDA increased 11% to Rs 746m and attributable PAT rose 53% to Rs 625m.

• Growth was led by Corporate Learning, while planned exits from capital-intensive school contracts and weak hiring weighed on Skills & Careers and School Learning.

• Focus remained on asset-light, technology-intensive and IP-led models, with liquidity, profitability and capital efficiency as priorities.

Financial highlights

• Consolidated operating revenue was Rs 8,505m vs Rs 8,452m YoY; total income was Rs 8,591m vs Rs 8,589m.

• EBITDA was Rs 746m vs Rs 674m; EBIT rose 59% to Rs 345m and attributable PAT increased to Rs 625m from Rs 409m.

• Basic EPS was Rs 3.76 vs Rs 2.47; diluted EPS was Rs 3.72 vs Rs 2.44.

• Standalone total income was Rs 4,130m vs Rs 4,047m; PAT was Rs 51m vs a Rs 35m loss.

Outlook and guidance

• CLG expected accelerated growth, supported by MTS outsourcing, higher contract flow and larger deals; the pipeline of MTS opportunities remained strong.

• SNC aimed to return to growth through StackRoute, DigiNxt, Training.com, new career courses and Talent Pipeline as a Service.

• The final government-school contract was expected to end in FY19, releasing working capital and improving liquidity and ROCE; Practice Plus was expected to support private-school growth.

• Revenue from the Real Estate Council of Ontario MTS contract was expected to begin accruing in July 2019 (FY20).