NEW YORK, NY and MUMBAI, INDIA, April 21, 2022 -- WNS (Holdings) Limited (WNS) (NYSE: WNS), a leading provider of global Business Process Management (BPM) solutions, today announced results for the fiscal 2022 fourth quarter and full year ended March 31, 2022.
|Highlights – Fiscal 2022 Fourth Quarter:|
|GAAP Financials Revenue of $298.8 million, up 22.5% from $243.9 million in Q4 of last year and up 5.2% from $284.1 million last quarter Profit of $38.9 million, compared to $27.5 million in Q4 of last year and $34.3 million last quarter Diluted earnings per ADS of $0.76, compared to $0.53 in Q4 of last year and $0.68 last quarter Non-GAAP Financial Measures Revenue less repair payments of $275.0 million, up 20.4% from $228.3 million in Q4 of last year and up 5.3% from $261.2 million last quarter Adjusted Net Income (ANI) of $48.3 million, compared to $36.7 million in Q4 of last year and $44.4 million last quarter Adjusted diluted earnings per ADS of $0.95, compared to $0.71 in Q4 of last year and $0.88 last quarter Other Metrics Added 10 new clients in the quarter, expanded 33 existing relationshipsDays sales outstanding (DSO) at 30 daysGlobal headcount of 52,081 as of March 31, 2022|
|Highlights – Fiscal 2022 Full Year:|
|GAAP Financials Revenue of $1,109.8 million, up 21.6.% from $912.6 million in fiscal 2021 Profit of $132.1 million, compared to $102.6 million in fiscal 2021 Diluted earnings per ADS of $2.58, compared to $1.97 in fiscal 2021 Non-GAAP Financial Measures* Revenue less repair payments of $1,026.8 million, up 18.2% from $868.7 million in fiscal 2021 Adjusted Net Income (ANI) of $174.8 million, compared to $141.7 million in fiscal 2021 Adjusted diluted earnings per ADS of $3.41, compared to $2.72 in fiscal 2021|
Reconciliations of the non-GAAP financial measures discussed below to our GAAP operating results are included at the end of this release. See also “About Non-GAAP Financial Measures.”
Revenue in the fourth quarter was $298.8 million, representing a 22.5% increase versus Q4 of last year and a 5.2% increase from the previous quarter. Revenue less repair payments* in the fourth quarter was $275.0 million, an increase of 20.4% year-over-year and 5.3% sequentially. Excluding exchange rate impacts, constant currency revenue less repair payments* in the fiscal fourth quarter was up 21.9% versus Q4 of last year and 5.4% sequentially. Year-over-year, fiscal Q4 revenue improved as a result of new client additions, the expansion of existing relationships, and increased travel volumes which more than offset unfavorable currency movements net of hedging. Sequentially, revenue improvement was driven by broad-based revenue growth across most verticals and service offerings and increased travel volumes.
Profit in the fiscal fourth quarter was $38.9 million, as compared to $27.5 million in Q4 of last year and $34.3 million in the previous quarter. Year-over-year, profit increased as a result of revenue growth, favorable currency movements net of hedging, improved productivity, a lower effective tax rate, and higher net interest income. These benefits more than offset the impact of wage increases and increased facility-related and travel costs. Sequentially, Q4 profit increased as a result of revenue growth, currency movements net of hedging, higher net interest income including a $0.6 million one-time benefit from interest income on a tax refund, and a lower effective tax rate. These benefits were partially offset by higher G&A expenses and increased facility-related and travel costs.
Adjusted net income (ANI)* in Q4 was $48.3 million, as compared to $36.7 million in Q4 of last year and $44.4 million in the previous quarter. Explanations for the ANI* movements on a year-over-year and sequential basis are the same as described for GAAP profit above with the exception of amortization of intangible expenses, share-based compensation costs and associated tax impacts, which are excluded from ANI*.
From a balance sheet perspective, WNS ended Q4 with $413.0 million in cash and investments and no debt. In the fourth quarter, the company generated $67.9 million in cash from operations, incurred $7.4 million in capital expenditures, and made scheduled debt payments of $8.4 million. Fourth quarter days sales outstanding were 30 days, the same as reported in both Q4 of last year and the previous quarter.
“The market for BPM services, driven by digitization, continues to be robust. WNS is executing well in this environment, delivering solid financial results for our shareholders and increased value for our clients,” said Keshav Murugesh, WNS’ Chief Executive Officer. “For full year fiscal 2022, WNS grew constant currency revenue less repair payments* by more than 16% and expanded our adjusted diluted earnings* per ADS by more than 25%. We enter fiscal 2023 with differentiated positioning in the BPM market, strong business momentum, a healthy new business pipeline, and high visibility to solid top line growth.”
The COVID-19 pandemic is impacting the global economy, our clients’ businesses, and WNS’s operations, financials, and visibility. Revenue has been pressured by lower client volumes, delays in new business ramps, client concessions, and facility lockdowns which impact service delivery. WNS is actively working to manage our clients’ changing requirements, adapt our service delivery models, ensure data security, and manage costs. In the fiscal fourth quarter, the company delivered more than 99% of our clients’ requirements. Going forward, impacts to our financial performance will be a function of how long the COVID-19 pandemic lasts on a global basis, and how long it takes our clients’ businesses to stabilize and recover.
Fiscal 2023 Guidance
WNS is providing guidance for the fiscal year ending March 31, 2023, as follows:
- Revenue less repair payments* is expected to be between $1,098 million and $1,154 million, up from $1,026.8 million in fiscal 2022. Guidance assumes an average GBP to USD exchange rate of 1.32 versus 1.37 in fiscal 2022.
- ANI* is expected to range between $177 million and $189 million versus $174.8 million in fiscal 2022. Guidance assumes an average USD to INR exchange rate of 76.0 versus 74.5 in fiscal 2022.
- Based on a diluted share count of 50.6 million shares, the company expects fiscal 2023 adjusted diluted earnings* per ADS to be in the range of $3.50 to $3.73 versus $3.41 in fiscal 2022.
“The company has provided our initial forecast for fiscal 2023 based on current visibility levels and exchange rates,” said Sanjay Puria, WNS’s Chief Financial Officer. “Our guidance for the full year reflects growth in revenue less repair payments* of 7% to 12% on a reported basis, or 8% to 14% constant currency*. We currently have 90% visibility to the midpoint of the range, consistent with April guidance in previous years. For the year, we expect capital expenditures of up to $40 million.”
WNS will host a conference call on April 21, 2022, at 8:00 am (Eastern) to discuss the company's quarterly results. To access the call in “listen-only” mode, please join live via the company’s investor relations website at ir.wns.com. For call participants, please use the following details: US dial-in +1-888-656-9018; international dial-in +1-503-343-6030; participant passcode 8899178. A replay will be available for one week following the call at +1-855-859-2056; international dial-in +1-404-537-3406; passcode 8899178, as well as on the WNS website, www.wns.com, beginning two hours after the end of the call.
WNS (Holdings) Limited (NYSE: WNS) is a leading Business Process Management (BPM) company. WNS combines deep industry knowledge with technology, analytics, and process expertise to co-create innovative, digitally led transformational solutions with over 400 clients across various industries. WNS delivers an entire spectrum of BPM solutions including industry-specific offerings, customer experience services, finance and accounting, human resources, procurement, and research and analytics to re-imagine the digital future of businesses. As of March 31, 2022, WNS had 52,081 professionals across 54 delivery centers worldwide including facilities in China, Costa Rica, India, the Philippines, Poland, Romania, South Africa, Spain, Sri Lanka, Turkey, the United Kingdom, and the United States.
Safe Harbor Statement
This release contains forward-looking statements, as defined in the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on our current expectations and assumptions about our Company and our industry. Generally, these forward-looking statements may be identified by the use of terminology such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “will,” “seek,” “should” and similar expressions. These statements include, among other things, expressed or implied forward-looking statements relating to our expectations regarding the impact of the COVID-19 pandemic on our business, our cost structure, the discussions of our strategic initiatives and the expected resulting benefits, our growth opportunities, industry environment, expectations concerning our future financial performance and growth potential, including our fiscal 2023 guidance, future profitability, and expected foreign currency exchange rates. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include but are not limited to worldwide economic and business conditions, our dependence on a limited number of clients in a limited number of industries; the impact of the COVID-19 pandemic on our and our clients’ business, financial condition, results of operations and cash flows; currency fluctuations; political or economic instability in the jurisdictions where we have operations; regulatory, legislative and judicial developments; increasing competition in the BPM industry; technological innovation; our liability arising from fraud or unauthorized disclosure of sensitive or confidential client and customer data; telecommunications or technology disruptions; our ability to attract and retain clients; negative public reaction in the US or the UK to offshore outsourcing; our ability to collect our receivables from, or bill our unbilled services to our clients; our ability to expand our business or effectively manage growth; our ability to hire and retain enough sufficiently trained employees to support our operations; the effects of our different pricing strategies or those of our competitors; our ability to successfully consummate, integrate and achieve accretive benefits from our strategic acquisitions, and to successfully grow our revenue and expand our service offerings and market share; and future regulatory actions and conditions in our operating areas. These and other factors are more fully discussed in our most recent annual report on Form 20-F and subsequent reports on Form 6-K filed with or furnished to the US Securities and Exchange Commission (SEC) which are available at www.sec.gov. We caution you not to place undue reliance on any forward-looking statements. Except as required by law, we do not undertake to update any forward-looking statements to reflect future events or circumstances.
References to “$” and “USD” refer to the United States dollars, the legal currency of the United States; references to “GBP” refer to the British pound, the legal currency of Britain; and references to “INR” refer to Indian Rupees, the legal currency of India. References to GAAP refers to International Financial Reporting Standards, as issued by the International Accounting Standards Board (IFRS).
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