Tech Mahindra Limited · NSE:TECHM
Tech Mahindra — Q2 FY21 Earnings Presentation
18 slides from Tech Mahindra's earnings presentation, October 2020
Slide 1: Earnings Presentation Q2 FY21
EARNINGS PRESENTATION Q2 FY21 October 2020 Copyright © 2020 Tech Mahindra. All rights reserved.
Slide 2: Q2'21 Snapshot
Q2’21 Snapshot $ 1.27 Bn 11.4% $ 235.7 Mn Revenue PAT margin Free Cash flow 14.2% $ 421 Mn EBIT Margin Net New Deal Wins 2 Copyright © 2020 Tech Mahindra. All rights reserved.
Slide 3: Business Highlights
Business Highlights FINANCIAL OPERATIONAL SEGMENT GEOGRAPHY Revenue Headcount Communications Americas 2.9% 124,258 3.2% 2.7% (cc) (842) EBIT % IT LTM attrition Enterprise Europe 410 bps 14% 5.9% 2.1% (3 pp) PAT % Utilization (incl trainees) IT Services ROW 70 bps 85% 2.5% 11.7% (3 pp) FCF to PAT % A
Slide 4: Management Commentary
Management Commentary CP Gurnani CEO, Tech Mahindra Our Repair, Rally and Rise strategy has helped the company to emerge stronger, as we journey towards a post Covid world. We are witnessing demand revival across multiple segments, as customers have accelerated their pace of digital transformation.
Slide 5: Business Update
Business Update Customers willing to spend on transformation deals WFH - 99% for IT, 95% for BPS Cloud, Analytics, Customer Mhealthy, Book My Seat and touchless Experience, Engineering Services, experience for safer workplace BPS showing positive momentum Employees Customers Community Operat
Slide 6: Vertical Performance
Vertical Performance Technology, Banking, financial Retail, transport VERTICALS Communications Manufacturing media & services & Others & logistics entertainment insurance % SHARE 39.3% 16.1% 9.8% 16.4% 7.5% 10.8% % QoQ +3.2% +0.5% +13.3% +9.6% +7.8% +1.6% % YoY -5.8% -12.0% +18.4% +24.7% +5.5% -17.2
Slide 7: Net New Deal Wins
Net New Deal Wins Enterprise, 214 Communications, 208 ($ Mn) TCV: $ 421 Mn Won a multi-year deal Selected as a strategic Engaged by a leading Tech Mahindra won a with an American partner for managed Chemicals and Fertilizers multi-year deal with an technology company manufacturing company Asian comm
Slide 8: Strategic Highlights
Strategic Highlights COLLABORATIONS SOLUTIONS LAUNCHED Collaborated with Rakuten Mobile to bring Rakuten Launched an intelligent cloud operations and Communications Platform to global customers to subscription management platform, iCOPS, for drive innovation in the telecom space. global enterprises.
Slide 9: People Updates
People Updates Tech Mahindra has featured amongst the Top 10 “Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a row. Tech Mahinda has been declared winners at the “2020 Stevie Awards for Great Employers” for our response to the COVID-19 pandemic. We won th
Slide 10: ESG Focus: Sustainability
ESG Focus: Sustainability Recognised as a Rated BBB by Tech Mahindra is at GHG emissions Leader by MSCI (Morgan a Prime status on assured by KPMG Sustainalytics, with Stanley Capital ISS ESG according to 99 percentile and an International) with Corporate rating ISAE3410 standard. overall ESG Score a
Slide 11: ESG Focus: Social
ESG Focus: Social COVID-19 RELIEF EMPLOYABILITY GLOBAL PROGRAMS • Food and essentials to 2.8 • Conducted 3 different • Launched the online lakh individuals. conclaves for students counselling services with visual impairment platform named, • 1.7 lakh cooked meals. Mind@Ease on World in which over 10
Slide 12: Management Commentary
Management Commentary Manoj Bhat CFO, Tech Mahindra Strong execution on both revenue growth and operational metrics has helped to improve our performance on all fronts. Our cash conversion continues to be robust and we remain committed towards creating value for our shareholders through effective ca
Slide 13: Financial Snapshot
Financial Snapshot REVENUE ($ Mn) GROSS PROFIT ($ Mn) EBITDA ($ Mn) PAT ($ Mn) 1,287 398.1 230.0 1,265 379.4 211.8 158.6 143.7 128.8 1,207 344.1 172.4 Q2'20 Q1'21 Q2'21 Q2'20 Q1'21 Q2'21 Q2'20 Q1'21 Q2'21 Q2'20 Q1'21 Q2'21 DILUTED EPS (Rs) FCF ($ Mn) CASH & EQUIVALENTS ROCE % ($ Mn) 316.7 12.8 12.1
Slide 14: Operational Snapshot
Operational Snapshot HEADCOUNT UTILIZATION ATTRITION REVENUE MIX (including trainees) (Onsite) 131,522 85% 21% 65.4% 123,416 124,258 82% 82% 17% 64.1% 14% 63.0% Q2'20 Q1'21 Q2'21 Q2'20 Q1'21 Q2'21 Q2'20 Q1'21 Q2'21 Q2'20 Q1'21 Q2'21 ACTIVE CLIENTS TOP 10% CLIENTS 50 Mn+ CLIENTS DSO 114 988 31.5% 22
Slide 15: Other financial highlights
Other financial highlights CASH CONVERSION TREASURY OTHERS Free cash flow to PAT conversion Hedge book at $ 2.4 Bn compared Tax rate at 24.6% in Q2 FY21, at 164.0 %. to $ 2.3 Bn in Q1 FY21. similar to 25.5% in Q1 FY21. H1 half-yearly FCF at $ 552.4 Mn, USD / INR Q2 FY21 average compared to
Slide 16: Capital Allocation
Capital Allocation CAPITAL RETURN MERGERS & ACQUISITIONS • Announced Special Dividend of ₹ 15 / Share. • Tech Mahindra announced the acquisition of 100% stake in Auckland, New Zealand • Over last 3 years Company has returned back headquartered Tenzing and Melbourne, cumulative cash of over USD 1 Bn
Slide 17: Financial Summary
Financial Summary in $ Mn Q2 FY 21 QoQ YoY Revenue 1,265.4 4.8% -1.7% EBIT 179.8 47.9% 10.1% EBIT % 14.2% Other Income 15.7 -71.6% -49.3% Miscellaneous + Interest Income 20.6 Exchange Gain/(Loss) (5.0) Profit Before Tax 190.1 11.8% 0.8% Provision for tax 46.7 Profit After Tax 143.7 11.5% -9.4% PAT %
Slide 18: Copyright © 2020 Tech Mahindra. All rights reserved.
Copyright © 2020 Tech Mahindra. All rights reserved.