Tech Mahindra Reports Milestone Quarter Earnings

Tech Mahindra Ltd., a leading provider of digital transformation, consulting and business re-engineering services and solutions, announced the audited consolidated financial results for its third quarter ended December 31, 2018.

Financial highlights for the quarter (Rs)

Revenue at  8,944 crore; up 15.0% YoY and up 3.6% QoQ

EBITDA at  1,723 crore; up 36.2% YoY and 6.4% QoQ

EBITDA margins at 19.3%; up 300 bps YoY and 50 bps QoQ

Consolidated PAT at  1,203 crore; up 27.5% YoY; and 13.0% QoQ

Earnings per Share (EPS) was ₹ 13.55 for the quarter ended Dec 31, 2018

Financial highlights for the quarter (USD)

Revenue at USD 1,260.8 mn; up 4.3% YoY and up 3.5% QoQ

Revenue growth up 4.3% QoQ, in Constant Currency terms

EBITDA at USD 244.7 mn; up 24.2% YoY and up 7.8% QoQ

Consolidated PAT at USD 171.1 mn, up 16.4% YoY and up 14.5% QoQ

C P Gurnani, Managing Director and Chief Executive Officer, Tech Mahindra said, “This is a milestone quarter for Tech Mahindra with 5 billion dollars annual revenue run rate in sight. The current quarter has been impressive on all fronts, delivering steady growth in Enterprise and Communications business along with margin expansion. Our Run, Change and Grow strategy has helped us deliver a strong 10% sequential growth in digital revenues. We are confident of continuing the growth momentum.”

Manoj Bhat, Chief Financial Officer, Tech Mahindra said, “We continue to improve on our operating metrics across most of our business lines. We have clocked yet another strong quarter, in terms of revenue growth, continued EBITDA margin improvement, cash flow and robust deal wins. This continued thrust on optimization and yield management has helped us achieve margin improvement of 300 bps on a YoY basis.”

Key Wins

• Engaged by a leading Telco in UK, as a partner in their transformation journey. Tech Mahindra will be responsible for driving improved customer experience through Next-Gen transformation, Automation and System rationalization.
• Bagged a contract from one of the largest banks in the ANZ region for digital channel integration across core banking processes and asset finance.
• Selected by a leading provider of jet engines and components for commercial and military aircraft as its partner for digital transformation solutions and cloud migration services, leveraging Tech Mahindra’s delivery excellence.
• Awarded a multi-year, multi-million dollar, customer experience transformation deal, by one of the largest Railroad companies in North America for technical infrastructure management and enterprise security, using best-in-class artificial intelligence and automation-based solution.
• Selected by a leading healthcare solution and device manager as long-term, strategic partner for engineering services leveraging Tech Mahindra’s expertise in Next-Gen technologies.
• Engaged by a leading global car manufacturer for complete development, localization and testing of vehicles.
• Chosen by a Tier 1 telecom operator in Western Europe for multi pillar-services, including Robotics, Automation, Security, Cloud, and Release management services.
• Chosen as a technology partner by one of the largest Global Communication Services Provider in the US for Turnkey services across the life cycle of Site Design, Engineering and Construction.
• Engaged by a Tier 1 CSP in North America as a strategic partner for program management, architecture, design and implementation, leveraging latest digital and data analytics technologies.

Business Highlights

• Tech Mahindra has launched GAiA - the first enterprise edition of open source Artificial Intelligence (AI) platform Acumos, which will enable enterprises across industry verticals to build, share and rapidly deploy AI-driven services and applications to solve business critical problems.
• Tech Mahindra has partnered with H2O.ai, the open source leader in Artificial Intelligence for establishing Center of Excellence to focus on critical industries such as Communications, Media & Entertainment, Healthcare & Life Sciences, and Banking, Financial Services & Insurance.
• Tech Mahindra has set up a ‘Video Integration and Engineering’ (VIE) business unit to leverage cutting-edge technology and solutions to cater to the heavy demand of video services in the 5G ecosystem.
• Tech Mahindra and Rakuten Mobile Network Inc. have collaborated for building world-class, next generation (4G & 5G) Software Defined Network laboratories. This lab will be one of its kind in the industry, which will help create next generation of mobile broadband, enabled by 5G, and transformation of industries across the globe.