EXL Reports 2015 First Quarter Results
Our business is divided into two reporting segments: Operations Management and Analytics and Business Transformation.
Reconciliations of adjusted financial measures to GAAP are included at the end of this release.
Revenues for the quarter ended
March 31, 2015were $143.5 millioncompared to $121.8 millionfor the quarter ended March 31, 2014and $135.3 millionfor the quarter ended December 31, 2014. Revenues for the quarter ended March 31, 2014were reduced by $2.5 millionand $8.5 million, respectively, due to the reimbursement of disentanglement costs. Operations Management revenues for the quarter ended March 31, 2015were $110.7 millioncompared to $100.1 millionfor the quarter ended March 31, 2014and $103.1 millionfor the quarter ended December 31, 2014. Analytics and Business Transformation revenues for the quarter ended March 31, 2015were $32.8 millioncompared to $21.7 millionfor the quarter ended March 31, 2014and $32.2 millionfor the quarter ended December 31, 2014.
Gross margin for the quarter ended
March 31, 2015was 35.1% compared to 38.5% for the quarter ended March 31, 2014and 32.5% for the quarter ended December 31, 2014. Operations Management gross margin for the quarter ended March 31, 2015was 36.3% compared to 41.2% for the quarter ended March 31, 2014and 32.8% for the quarter ended December 31, 2014. Analytics and Business Transformation gross margin for the quarter ended March 31, 2015was 31.0% compared to 26.2% for the quarter ended March 31, 2014and 31.5% for the quarter ended December 31, 2014.
Operating margin for the quarter ended
March 31, 2015was 9.4% compared to 12.7% for the quarter ended March 31, 2014and 5.2% for the quarter ended December 31, 2014. Adjusted operating margin for the quarter ended March 31, 2015was 13.8% compared to 19.0% for the quarter ended March 31, 2014and 14.1% for the quarter ended December 31, 2014. Adjusted EBITDA for the quarter ended March 31, 2015was $24.8 millioncompared to $28.5 millionfor the quarter ended March, 2014 and $26.1 millionfor the quarter ended December 31, 2014.
Net income for the quarter ended
March 31, 2015was $9.6 millioncompared to $11.1 millionfor the quarter ended March 31, 2014and $7.5 millionfor the quarter ended December 31, 2014.
Diluted earnings per share for the quarter ended
March 31, 2015were $0.28compared to $0.33for the quarter ended March 31, 2014and $0.22for the quarter ended December 31, 2014. Adjusted diluted earnings per share for the quarter ended March 31, 2015was $0.41compared to $0.50for the quarter ended March 31, 2014and $0.48for the quarter ended December 31, 2014.
Closed the acquisition of analytics firm RPM Direct on
Won 9 new clients for the first quarter including 4 in Operations Management and 5 in Analytics and Business Transformation.
Expanded multiple operations management relationships, including migrating 24 new processes in the first quarter of 2015.
Named a 2014 Partner of the Year for Technology and Innovation by Aflac for MedConnectionSM.
Positioned in the
Winner's Circlein the "HfS Blueprint: Population Healthand Care Management Services".
Positioned as a Major Player in the "IDC MarketScape: Global Professional Services Firms for Utilities Customer Operations".
Consolidated our Analytics delivery facilities into a new world-class center in Gurgaon in order to add additional expansion capacity and create an enhanced environment to showcase our analytical capabilities.
Recorded headcount as of
March 31, 2015of 22,600 compared to 22,800 as of December 31, 2014and 22,800 (including employees under managed services) as of March 31, 2014.
Reported employee attrition for the quarter ended
March 31, 2015of 33.6%, compared with 33.5% for the quarter ended December 31, 2014and 28.8 % for the quarter ended March 31, 2014.
Based on current visibility and an Indian rupee to U.S. dollar exchange rate of 63, the Company is providing the following guidance for calendar year 2015:
$600 millionto $620 million.
Adjusted diluted earnings per share, excluding the impact of stock-based compensation expense, amortization of intangibles and associated tax impacts, of
To listen to the conference call via phone, please dial 1-877-303-6384 or if dialing in internationally, 1-224-357-2191 and an operator will assist you. For those who cannot access the live broadcast, a replay will be available on the EXL website ir.exlservice.com.
EXL (Nasdaq:EXLS) is a leading business process solutions company that looks deeper to drive business impact through integrated services and industry knowledge. EXL provides operations management, decision analytics and technology platforms to organizations in insurance, healthcare, banking and financial services, utilities, travel, and transportation and logistics, among others. We work as a strategic partner to help our clients streamline business operations, improve corporate finance, manage compliance, create new channels for growth and better adapt to change. Headquartered in
This press release contains forward-looking statements. You should not place undue reliance on those statements because they are subject to numerous uncertainties and factors relating to the EXL's operations and business environment, all of which are difficult to predict and many of which are beyond EXL's control. Forward-looking statements include information concerning EXL's possible or assumed future results of operations, including descriptions of its business strategy. These statements may include words such as "may," "will," "should," "believe," "expect," "anticipate," "intend," "plan," "estimate" or similar expressions. These statements are based on assumptions that we have made in light of management's experience in the industry as well as its perceptions of historical trends, current conditions, expected future developments and other factors it believes are appropriate under
the circumstances. You should understand that these statements are not guarantees of performance or results. They involve known and unknown risks, uncertainties and assumptions. Although EXL believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect EXL's actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. These factors are discussed in more detail in EXL's filings with the
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share and per share amounts)
Three months ended
|Revenues, net||$ 143,510||$ 121,797|
|Cost of revenues (exclusive of depreciation and amortization)||93,125||74,922|
|General and administrative expenses||18,621||14,800|
|Selling and marketing expenses||11,243||10,232|
|Depreciation and amortization||7,053||6,356|
|Total operating expenses||36,917||31,388|
|Income from operations||13,468||15,487|
|Foreign exchange income / (loss)||1,134||(833)|
|Other income, net||1,178||958|
|Income before income taxes||15,780||15,612|
|Income tax expense||6,213||4,465|
|Net income||$ 9,567||$ 11,147|
|Earnings per share:|
|Basic||$ 0.29||$ 0.34|
|Diluted||$ 0.28||$ 0.33|
|Weighted-average number of shares used in computing earnings per share:|
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
|Cash and cash equivalents||$ 151,319||$ 176,499|
|Accounts receivable, net||89,323||80,244|
|Deferred tax assets, net||4,921||4,455|
|Advance income tax, net||9,305||9,905|
|Other current assets||13,241||12,533|
|Total current assets||295,088||302,391|
|Fixed assets, net||47,467||45,369|
|Deferred tax assets, net||8,288||11,985|
|Intangible assets, net||60,085||46,979|
|Total assets||$ 611,018||$ 573,556|
|Liabilities and Stockholders' Equity|
|Accounts payable||$ 5,510||$ 4,663|
|Accrued employee cost||21,021||37,606|
|Accrued expenses and other current liabilities||39,386||40,206|
|Current portion of capital lease obligations||743||803|
|Total current liabilities||84,906||90,968|
|Long term borrowings||75,000||50,000|
|Capital lease obligations, less current portion||424||560|
|Commitments and contingencies|
|Accumulated other comprehensive loss||(53,015)||(55,509)|
|Total stockholders' equity including shares held in treasury||465,322||447,122|
Less: 1,310,751 shares as of
|Total stockholders' equity||436,961||419,158|
|Total liabilities and stockholders' equity||$ 611,018||$ 573,556|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Reconciliation of Adjusted Financial Measures to GAAP Measures
In addition to its reported operating results in accordance with U.S. generally accepted accounting principles (GAAP), EXL has included in this release adjusted financial measures (adjusted EBITDA, adjusted net income and adjusted diluted earnings per share) that the
Additionally, EXL provides certain information on a constant currency basis, which reflects a comparison of current period results translated at the prior period currency rates. This information is provided because EXL believes that it provides useful incremental information to investors regarding EXL's operating performance.
The following table shows the reconciliation of these adjusted financial measures from GAAP measures for the three months ended
|Reconciliation of Adjusted Operating Income and Adjusted EBITDA|
|(Amounts in thousands)|
Three Months Ended
Three Months Ended
|Revenues (GAAP)||$ 143,510||$ 121,797||$ 135,286|
|add: Reimbursement of transition and disentanglement costs (a)||--||2,471||8,532|
|Revenues (Non-GAAP)||$ 143,510||$ 124,268||$ 143,818|
|subtract: Cost of revenues (GAAP)||(93,125)||(74,922)||(91,371)|
|subtract: Operating expenses (GAAP)||(36,917)||(31,388)||(36,850)|
|Income from operations (Non- GAAP)||$ 13,468||$ 17,958||$ 15,597|
|add: Stock-based compensation expense (b)||4,255||4,176||2,493|
|add: Amortization of acquisition-related intangibles (c)||2,059||1,536||2,157|
|Adjusted operating income (Non-GAAP)||$ 19,782||$ 23,670||$ 20,247|
|Adjusted operating income margin as a % of Revenues (Non-GAAP)||13.8%||19.0%||14.1%|
|Adjusted EBITDA (Non-GAAP)||$ 24,776||$ 28,490||$ 26,069|
|Adjusted EBITDA margin as a % of Revenues (Non-GAAP)||17.3%||22.9%||18.1%|
|(a) To exclude reimbursement of transition and disentanglement costs for a disclosed client issue.|
|(b) To exclude stock-based compensation expense under ASC Topic 718.|
|(c) To exclude amortization of acquisition-related intangibles.|
|Reconciliation of Adjusted Net Income and Adjusted Diluted Earnings Per Share|
|(Amounts in thousands, except per share data)|
Three Months Ended
Three Months Ended
|Net income (GAAP)||$ 9,567||$ 11,147||$ 7,461|
|add: Stock-based compensation expense (a)||4,255||4,176||2,493|
|add: Amortization of acquisition-related intangibles (b)||2,059||1,536||2,157|
|add: reimbursement of transition and disentanglement costs (c)||--||2,471||8,532|
|subtract: Tax impact on stock-based compensation expense||(1,626)||(1,596)||(951)|
|subtract: Tax impact on amortization of acquisition-related intangibles||(433)||(170)||(348)|
|subtract: Tax impact on reimbursement of transition and disentanglement costs||--||(939)||(3,242)|
|Adjusted net income (Non-GAAP)||$ 13,822||$ 16,625||$ 16,102|
|Adjusted diluted earnings per share (Non-GAAP)||$ 0.41||$ 0.50||$ 0.48|
|(a) To exclude stock-based compensation expense under ASC Topic 718.|
|(b) To exclude amortization of acquisition-related intangibles.|
|(c) To exclude reimbursement of transition and disentanglement costs for a disclosed client issue.|
Steven N. BarlowVice President, Investor Relations ExlService Holdings, Inc. 280 Park Avenue New York, NY10017 (212) 624-5913 email@example.com
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