WNS net rises 52.5%

Business process outsourcing services provider WNS has revised its full-year forecast upwards on better visibility on revenue growth for FY13. The guidance reflects a top line growth rate of 11 per cent.

WNS, listed on the New York Stock Exchange, puts its FY13 guidance to be $437-439 million. The company had earlier guided for revenue at $426-438 million. It also revised its adjusted net income to be $52-54 million.

WNS reported net profit of $6.1 million for the third quarter ended December 31, up 52.5 per cent from $4 million in the same quarter in the last financial year. Sequentially, profit went up 41.8 per cent from $4.3 million.

Revenue for the quarter was up 2.6 per cent to $120.2 million from $117.20 million on a year-on-year basis.

On a sequential basis, the company saw its revenue go up by 6.3 per cent.

“We are pleased with the top line progress made during the quarter, as revenue was positively impacted by the start of several new projects and broad-based growth across verticals, services and geographies. While some of this new project revenue came with higher costs in the short term, we are confident that as the processes and relationships mature, our margins will expand. At a macro level, overall demand for BPO services remains stable and healthy as we enter calendar 2013,” said Keshav Murugesh, CEO of WNS.

During the quarter, WNS added nine clients and expanded eight existing relationships. In the last quarter, it had added three clients. Revenues, less repair payments, were up 16.05 per cent from $97.8 million to $113.5 million. Revenues less repair payments are non-Gaap (generally accepted accounting principles) measure that includes auto claims business, and payments to repair centres.

WNS ended the third quarter with $86.3 million in cash and marketable securities and $84.6 million of gross debt. The company generated $25.8 million in cash from operations, and capital expenditures for the quarter came in at $5.8 million.

Third quarter adjusted operating margin was 13.9 per cent, compared to 16.7 per cent in Q3 of last year and 13.7 per cent in the second quarter. The reduction in adjusted operating margin is due to infrastructure expansion, project transition costs and integration costs associated with the acquisition of Fusion Outsourcing