Hexaware Q3 net profit growth flat

Hexaware managed to surprise the street with better than expected numbers and a performance that beats its peer in the mid-cap segment. 

The company reported net profit of Rs 111.4 crore for the third quarter ended September 30, 2016, representing a dip of 0.1 per cent from Rs 111.6 crore in the same quarter last year. On a QoQ basis profits grew 11.4 per cent. 

Topline buoyed by good client addition grew 10.5 per cent YoY at Rs 904.1 crore and a growth of 4 per cent on sequential basis. During the quarter the company added six new clients with total contract value of $ 42 million. 

The big positive was the US dollar revenue growth. For the quarter, the company reported US dollar revenue at $135.9 million up 4.8 per cent on QoQ basis. 

“We continue to build solid momentum and volume growth across multiple verticals and service lines. Our strategy of Shrink IT, Grow Digital is uniquely differentiated from the traditional service providers and we have confidence that we will deliver differentiated performance.” stated R Srikrishna, CEO & Executive Director, Hexaware Technologies.

The company also announced that the Board of Directors have approved the buyback of shares up to 5.69 million at a price of Rs 240 per share for an aggregate amount not exceeding Rs 136.7 crore. 

“Buyback is the most efficient way of returning Capital back to the shareholders” stated Rajesh Kanani, Chief Financial Officer, Hexaware Technologies.

For the quarter the company reported EBITDA margin of 18.2 per cent an increase of 210 basis points. 

In Q3 2016, Americas led the geographic growth with 5.6 per cent QoQ and 10.4 per cent YoY growth. Banking and Financial Services (BFS) showed a healthy growth of 8.6 per cent QoQ and 19.5 per cent YoY. Infrastructure Management Services (IMS) delivered strong growth of 11.2 per cent QoQ and 29.7 per cent YoY. Business Process Services (BPS) grew 9.6 per cent QoQ and 28.4 per cent YoY.