Hexaware Technologies Ltd (HTL), which is engaged in the IT, BPO and consulting services sectors, has expressed confidence that it would be able to deliver double digit growth during calendar year 2013 (which is also its FY).
The stock had gained Rs 2.50 to trade at Rs 83.80, accompanied by a huge volume of 91.32 lakh shares in the NSE in the morning session today.
Giving details of its fourth quarter results for 2012 on a consolidated basis, the company reported a revenue of Rs 502.28 crore ($92.4 million) meeting its revenue guidance. Its PAT, however, was down to Rs 66.17 crore as against Rs 88.24 crore in the same quarter in the previous year.
HTL said its gross margin in the last quarter was 36.1 per cent. But the operating profit (EBIT) margin was down 480 basis points at 15.1 per cent compared to 19.9 per cent in Q3 of the year, which the company said was “in line with the revised profit margin outlook provided” by it.
P.R. Chandrasekar, CEO &VC, HTL, said with investments made to strengthen HTL's competencies and expansion in the field force in line with the strategic plan, he was “confident of delivering double digit revenue growth" in 2013. He expected an expansion in operating margins to begin immediately in Q1 2013 and “continue going forward”. On constant currency levels, he said in Q1 of this year, he expected the operating margin to expand 150-200 basis points quarter-on-quarter sequentially.
Going forward, HTL said it expected the Q1 2013 revenue to be around $94 million-$95 million (exchange rate at $1= Rs 53.52).
The attrition rate also had come down to 8.7 per cent compared to 13.9 per cent during the same quarter in the previous year.
For the full year 2012, HTL’s income from operations on a consolidated basis was Rs 1,948.17 crore compared to Rs 1,450.51 crore during 2011. The profit after tax jumped to Rs 327.64 crore (Rs 267.02 crore). The basic EPS was Rs 11.09 (Rs 9.13). The CY 2012 revenue increase in rupee terms was 34 per cent and in $ terms it was 18 per cent.
While the EBIT margin was up 280 basis points y-o-y, the EBIT was up 56 per cent y-o-y during 2012. The PAT at Rs 327.6 crore was up by 23 per cent y-o-y.
On a stand alone basis, the Q4 income was Rs 220.11 crore compared to Rs 209.49 crore in the same period in the previous year. The PAT was Rs 56.60 crore in Q 4 of 2012, which was less than the Q 4 profit of Rs 78.37 crore in 2011. The full year profit was Rs 285.60 crore (Rs 231.98 crore) and the EPS was Rs 9.66 (Rs 7.94) on a stand alone basis.
The company declared a final dividend of Rs 1.20 per share (Rs 2 FV), taking the total dividend payout for the year to Rs 5.40/share. Atul Nishar, Chairman, HTL, said the company intends to distribute approximately 50 per cent of the profit after tax as dividend, and, given the financial strength and growth prospects, “dividend will continue to be declared every quarter”.
The stock has come off its 52-week-high of Rs 140.90 it had touched on September 14 last year and is barely off its yearly low of Rs 72.60 it touched on January 25 this year. Probably, the earnings guidance given for Q1 of this year is enabling the stock to hold firm.