* For FY10, the management expects overall positive revenue growth and expect improvement in profitability on the back of better capacity utilization, continued focus on productivity gains and stabilization of ramp.
* Q1FY10 would see fall in collections business due to seasonality.
* The Healthcare segment is seeing impact. The State Governments are under budgetary pressures. This is impacting the providers of healthcare services. The payment cycle has increased.
* The credit card collection is seeing impact and would remain depressed.
* The Company is seeing sporadic cases for price reduction. The healthcare segment is seeing pricing pressure.
* The management expects EBIT to be stable with upward bias.
* For the quarter ended March 2009, FSL reported 6% sequential rise in operating revenues at Rs 472.30 crore. In US dollar terms, the growth was 4.6% and on constant currency basis it was 7.1%. OPM improved 250bps at 12.8% on stabilization of ramp in domestic business and benefit of seasonal collection business due to tax refunds in US.
* For FY09, FSL reported 35% growth in operating revenues at Rs 1749.37 crore. The growth in US dollar terms was 16.1% and on constant currency it was 25%. On organic basis, the growth was 10.6% on constant currency basis. OPM was down 480bps at 13.2% on the back of stress on healthcare and credit card collection segment and high ramp. Other Income was at expense of Rs 33.67 crore includes MTM losses of Rs 23.6 crore, translation/consolidation losses Rs 13.4 crore.
* For the quarter, the MTM loss on undesignated hedges was Rs 23.6 crore and translation and consolidation loss was Rs 6.5 crore.
* During the quarter, the Company bought back FCCBs worth US$ 49.7 million at a discount of Rs 63.5 crore, which has been treated as gains. The FCCB buyback has been financed thru ECB both in US dollar and GBP. The cost of ECB is slightly less than 10%. The effective yield for FCCBs is 6.75%.
* During the quarter, the Company restructured and rationalized its delivery centres at a cost of Rs 13.8 crore. The Company added 2 new delivery centres in Coimbatore and Bangalore in India and it shut down a centre in North America.
* The Company has outstanding hedges of US$ 82 million: 70% in GBP and 30% in US dollars. For FY10, 100% of US dollars are covered and 50% of GBP is covered. For FY11, 100% of US dollars are covered. The rate for FY10 is Rs 45/US$ and Rs 75/GBP and for FY11 is Rs 46/US$.
* Average realized rate for the quarter was Rs 49/US$ against 45.17/US$ in the sequential quarter.
* The seat fill factor was down at 70% against 74% in the sequential quarter on account of addition of centres so number of seats available increased.
* The capex for FY09 was Rs 98.1 crore. For FY10, the capex was US$ 15 million. The depreciation charge for FY10 would be about 5.5-6% of revenues.
* Cash & cash equivalents were Rs 96.69 crore and debt including FCCBs is Rs 1394.56 crore. Average cost of debt other than FCCBs is 8%.
* The Company reduced 950 employees during the quarter taking the total number of employees at the end of the quarter to 21570 (22520 at end sequential quarter). Employees in India increased to 16859 (17991 at end sequential quarter) and outside India to 4711 (4529 at end sequential quarter). The number of seats increased at 18932 (17715 at end sequential quarter) with seat fill factor at 70% (74% at end sequential quarter).
* For quarter ended March 2009, geographically, US contributed 63.6% against 63.9% in the sequential quarter. India contributed 11.9% down from 10.1% in the sequential quarter. UK contribution dipped at 24% down from 25.4%.
o For the quarter, BFSI contributed 24.3% up from 23.2% in the sequential quarter due to increase in seasonal collection business; Telecom & Media contribution at 33.7% up from 32.3% and Healthcare contribution was down at 39.8% from 41.5% in the sequential quarter.
o Offshore contribution to revenues was at 28.3% down from 30.6% in the sequential quarter, domestic was 11.9% up from 10.1% and onshore was 59.8% up from 59.3%.
o Top client contribution grew 8.3% at 10.7%, top 2-5 client contribution grew 7.3% at 31.7% and other than top 5 have increased 5.9% at 68.3%.
* Q1FY10 would see fall in collections business due to seasonality.
* The Healthcare segment is seeing impact. The State Governments are under budgetary pressures. This is impacting the providers of healthcare services. The payment cycle has increased.
* The credit card collection is seeing impact and would remain depressed.
* The Company is seeing sporadic cases for price reduction. The healthcare segment is seeing pricing pressure.
* The management expects EBIT to be stable with upward bias.
* For the quarter ended March 2009, FSL reported 6% sequential rise in operating revenues at Rs 472.30 crore. In US dollar terms, the growth was 4.6% and on constant currency basis it was 7.1%. OPM improved 250bps at 12.8% on stabilization of ramp in domestic business and benefit of seasonal collection business due to tax refunds in US.
* For FY09, FSL reported 35% growth in operating revenues at Rs 1749.37 crore. The growth in US dollar terms was 16.1% and on constant currency it was 25%. On organic basis, the growth was 10.6% on constant currency basis. OPM was down 480bps at 13.2% on the back of stress on healthcare and credit card collection segment and high ramp. Other Income was at expense of Rs 33.67 crore includes MTM losses of Rs 23.6 crore, translation/consolidation losses Rs 13.4 crore.
* For the quarter, the MTM loss on undesignated hedges was Rs 23.6 crore and translation and consolidation loss was Rs 6.5 crore.
* During the quarter, the Company bought back FCCBs worth US$ 49.7 million at a discount of Rs 63.5 crore, which has been treated as gains. The FCCB buyback has been financed thru ECB both in US dollar and GBP. The cost of ECB is slightly less than 10%. The effective yield for FCCBs is 6.75%.
* During the quarter, the Company restructured and rationalized its delivery centres at a cost of Rs 13.8 crore. The Company added 2 new delivery centres in Coimbatore and Bangalore in India and it shut down a centre in North America.
* The Company has outstanding hedges of US$ 82 million: 70% in GBP and 30% in US dollars. For FY10, 100% of US dollars are covered and 50% of GBP is covered. For FY11, 100% of US dollars are covered. The rate for FY10 is Rs 45/US$ and Rs 75/GBP and for FY11 is Rs 46/US$.
* Average realized rate for the quarter was Rs 49/US$ against 45.17/US$ in the sequential quarter.
* The seat fill factor was down at 70% against 74% in the sequential quarter on account of addition of centres so number of seats available increased.
* The capex for FY09 was Rs 98.1 crore. For FY10, the capex was US$ 15 million. The depreciation charge for FY10 would be about 5.5-6% of revenues.
* Cash & cash equivalents were Rs 96.69 crore and debt including FCCBs is Rs 1394.56 crore. Average cost of debt other than FCCBs is 8%.
* The Company reduced 950 employees during the quarter taking the total number of employees at the end of the quarter to 21570 (22520 at end sequential quarter). Employees in India increased to 16859 (17991 at end sequential quarter) and outside India to 4711 (4529 at end sequential quarter). The number of seats increased at 18932 (17715 at end sequential quarter) with seat fill factor at 70% (74% at end sequential quarter).
* For quarter ended March 2009, geographically, US contributed 63.6% against 63.9% in the sequential quarter. India contributed 11.9% down from 10.1% in the sequential quarter. UK contribution dipped at 24% down from 25.4%.
o For the quarter, BFSI contributed 24.3% up from 23.2% in the sequential quarter due to increase in seasonal collection business; Telecom & Media contribution at 33.7% up from 32.3% and Healthcare contribution was down at 39.8% from 41.5% in the sequential quarter.
o Offshore contribution to revenues was at 28.3% down from 30.6% in the sequential quarter, domestic was 11.9% up from 10.1% and onshore was 59.8% up from 59.3%.
o Top client contribution grew 8.3% at 10.7%, top 2-5 client contribution grew 7.3% at 31.7% and other than top 5 have increased 5.9% at 68.3%.
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