DRIVING GROWTH THROUGH INNOVATION
Earnings Press Release Q1 2024
R Systems- Earnings Press Release March 31, 2024
R Systems Announces Results for Q1 2024
Revenues: Rs. 4,166 mn with Adj. EBITDA Margin of 14.4%
Noida, India - May 02, 2024: R Systems International Limited (BSE- 532735; NSE- RSYSTEMS), a leading digital product engineering company that designs and builds next-gen products, platforms, and digital experiences, empowering clients across various industries to achieve revenue growth and operational efficiency.
Highlights for the quarter ended March 31, 2024
- Revenue Rs. 4,166 mn (US$ 50.2 mn); YoY Growth of 3.1%.
- Adj. EBITDA 600 mn (US$ 7.2 mn) i.e 14.4% as against 13.4% for Q1 2023 #.
- Net profit after taxes Rs. 275 mn (US$ 3.3 mn).
- 6 key clients added during the quarter.
Nitesh Bansal, Managing Director, and CEO stated, "We have stepped into CY 2024 with excitement about our GTM motion, with vertical and horizontal alignment of delivery and sales operations to develop more meaningful relationships with our customers. We are also developing partnerships with ecosystem players such as hyper scalers, automation & AI technology providers and global enterprise software providers. Our AI and Cloud first approach is helping us bring positive traction on large deals and building robust sales funnel for large deals."
He added, "We welcome Mr. Sanjay Sahay as Chief Marketing Officer and I am sure that his marketing acumen will be instrumental in elevating our brand as well as create more digital engagement for our customers. I am also delighted to share that R Systems has been recognised as a major contender in our first ever Everest Peak Matrix Assessment for software product engineering. Getting recognised by leading research analyst and deal advisory agencies is an important part of growth strategy and this is the first step towards the same."
Nand Sardana, CFO said, "We expanded our sustainable operating margins, excluding the RSU expense, through improved utilization. In this current challenging environment, we are continuing to invest in newer technologies, innovation, sales engine, and branding for long term profitable growth."
- Adj. EBITDA is before considering the share-based payment expense amounting to Rs. 65 mn relating to restricted stock units ("RSUs") granted to the employees.
2
R Systems- Earnings Press Release March 31, 2024
Key Deal Wins
US based behavioral healthcare solution provider trusted R Systems to set up a COE for its product engineering and digital transformation needs including data science and analytics to augment operational efficiency and value-based care.
One of the leading fire safety solution providers based in Canada has engaged R Systems to develop a mobility app using .NET Multi-platform App UI, digitalizing their operations for enhanced business efficiency.
US based digital marketing solution provider has engaged R Systems to upgrade their content management product along with assisting in consolidating their engineering teams for product engineering and modern data platforms/AI needs.
One of the largest privately owned general insurance companies has engaged R Systems to provide product engineering services to digitalize its in-house products.
One of the leading distributors of live and frozen seafood in Singapore has engaged R Systems to implement Microsoft Dynamics Business Central and CRM to optimize and digitalize its end-to-end business processes yielding financial visibility and operational excellence across the enterprise.
Liquidity and Shareholder Funds
Cash and bank balances, net of short-term borrowing and amount set aside for dividend as of March 31, 2024, were Rs. 1,147 mn compared to Rs. 1,338 mn as of December 31, 2023. Total equity attributable to shareholders as of March 31, 2024, was Rs. 5,707 mn compared to Rs. 6,114 mn as of December 31, 2023.
3
R Systems- Earnings Press Release March 31, 2024
Financial Performance
Consolidated Profit & Loss Statement for the Quarter Ended March 31, 2024 (As per Ind AS)
(Rs. in mn, except per share data)
Sr. | Particulars | Quarter Ended | |||||||||
No. | March | December | March | ||||||||
31, 2024 | 31, 2023 | 31, 2023 | |||||||||
1 | Income | ||||||||||
(a) | Revenue from operations | 4,166.41 | 4,163.20 | 4,040.71 | |||||||
(b) | Other income | 24.69 | 17.73 | 52.13 | |||||||
Total income | 4,191.10 | 4,180.93 | 4,092.84 | ||||||||
2 | Expenses | ||||||||||
(a) | Employee benefits expense @ | 2,949.34 | 2,840.52 | 2,819.84 | |||||||
(b) | Finance costs | 28.42 | 28.94 | 15.94 | |||||||
(c) | Depreciation and amortization expense* | 165.61 | 169.20 | 101.24 | |||||||
(d) | Other expenses | 683.88 | 694.32 | 677.82 | |||||||
Total expenses | 3,827.25 | 3,732.98 | 3,614.84 | ||||||||
3 | Profit before tax and Share in Profit / (Loss) of | 363.85 | 447.95 | 478.00 | |||||||
Associate (1-2) | |||||||||||
4 | Share of net profit / (loss) of associates accounted | - | (3.03) | - | |||||||
for using the equity method | |||||||||||
5 | Profit before tax (3+4) | 363.85 | 444.92 | 478.00 | |||||||
6 | Tax expense | ||||||||||
(a) | Current tax ^ | 131.55 | (1.80) | 103.47 | |||||||
(b) | Deferred tax charge / (credit) | (42.57) | (11.99) | 16.18 | |||||||
Total tax expense / (credit) | 88.98 | (13.79) | 119.65 | ||||||||
7 | Net profit for the period (5-6) | 274.87 | 458.71 | 358.35 | |||||||
8 | Earnings per share (not annualized) | ||||||||||
(Equity share of par value of Re. 1/- each) | |||||||||||
(a) | Basic | 2.32 | 3.88 | 3.03 | |||||||
(b) | Diluted | 2.32 | 3.88 | 3.03 |
@ including share-based payment expense of Rs. 64.65 mn in Q1 2024 w.r.t. RSUs.
- Depreciation and amortization expense includes INR 62.33 mn for Q1 2024 (INR 61.08 for Q4 2023) for amortization of intangibles such as customer contracts, non-compete capitalized under Velotio and ScaleWorx acquisitions.
- Q4 2023 includes Rs. 114.46 mn reversal of tax provisions related to dividend received from subsidiary, pursuant to declaration of the interim dividend by the Company.
4
R Systems- Earnings Press Release March 31, 2024
Financial Performance
Consolidated Profit & Loss Statement for the Quarter Ended March 31, 2024 (Contribution Analysis Format - Non-GAAP)
(Figures in mn)
Particulars | Q1 2024 | Q4 | 2023 | Q1 | 2023 | ||||||||
INR | US$ | INR | US$ | INR | US$ | ||||||||
Revenues | 4,166.41 | 50.17 | 4,163.20 | 50.00 | 4,040.71 | 49.16 | |||||||
Cost of revenues | 2,761.75 | 33.26 | 2,749.39 | 33.03 | 2,681.88 | 32.63 | |||||||
Gross margin | 1,404.66 | 16.91 | 1,413.81 | 16.97 | 1,358.83 | 16.53 | |||||||
33.71% | 33.96% | 33.63% | |||||||||||
SG & A Expenses | 804.91 | 9.69 | 771.08 | 9.25 | 815.44 | 9.92 | |||||||
19.32% | 18.52% | 20.18% | |||||||||||
Adj. EBITDA | 599.75 | 7.22 | 642.73 | 7.72 | 543.39 | 6.61 | |||||||
14.39% | 15.44% | 13.45% | |||||||||||
Cost of RSUs | 64.65 | 0.78 | - | - | - | - | |||||||
EBITDA | 535.10 | 6.44 | 642.73 | 7.72 | 543.39 | 6.61 | |||||||
12.84% | 15.44% | 13.45% | |||||||||||
Depreciation and amortization * | 165.61 | 1.99 | 169.20 | 2.04 | 101.24 | 1.23 | |||||||
EBIT before non-recurring cost | 369.49 | 4.45 | 473.53 | 5.68 | 442.15 | 5.38 | |||||||
Non-Recurring cost# | - | - | 11.93 | 0.14 | - | - | |||||||
EBIT | 369.49 | 4.45 | 461.60 | 5.54 | 442.15 | 5.38 | |||||||
Interest expense | (28.42) | (0.34) | (28.94) | (0.35) | (15.94) | (0.19) | |||||||
Other income (net) | 22.77 | 0.27 | 15.29 | 0.18 | 51.79 | 0.63 | |||||||
Income before income tax and share | 363.84 | 4.38 | 447.95 | 5.37 | 478.00 | 5.82 | |||||||
of profit / (loss) in associates | |||||||||||||
Share of net profit / (loss) of associates | - | - | (3.03) | (0.04) | - | - | |||||||
accounted for using the equity method | |||||||||||||
Income before income tax | 363.84 | 4.38 | 444.92 | 5.33 | 478.00 | 5.82 | |||||||
Tax expense / (credit)^ | 88.98 | 1.07 | (13.79) | (0.19) | 119.65 | 1.46 | |||||||
Net earnings | 274.86 | 3.31 | 458.71 | 5.52 | 358.35 | 4.36 |
- Depreciation and amortization expense includes INR 62.33 mn for Q1 2024 (INR 61.08 for Q4 2023) for amortization of intangibles such as customer contracts, non-compete capitalized under Velotio and ScaleWorx acquisitions.
# Non-recurring cost represents professional fee paid w.r.t. acquisition of Scaleworx and charges paid to Noida Authority for change in constitution of the Company.
- Tax expenses in Q4 2023 include Rs. 114.46 mn reversal of tax provisions related to dividend received from subsidiary, pursuant to declaration of the interim dividend by the Company.
5
R Systems- Earnings Press Release March 31, 2024
Financial Performance
Consolidated Balance Sheet as at March 31, 2024 (As per Ind AS)
(Rs. in mn) | ||||
Particulars | As at | |||
March 31, 2024 | December 31, 2023 | |||
ASSETS | ||||
A. Non-current assets | ||||
(a) | Property, plant and equipment | 623.28 | 607.41 | |
(b) | Capital work in progress | 1.03 | 1.64 | |
(c) | Investment property | 15.58 | 15.96 | |
(d) | Right-to-use assets | 622.54 | 628.55 | |
(e) | Goodwill | 2,834.33 | 2,836.58 | |
(f) | Other Intangible assets | 2,116.50 | 2,181.20 |
- Financial assets
(i) | Investment | 0.03 | 0.03 | |
(ii) | Other financial assets | 111.95 | 115.14 | |
(h) | Deferred tax assets (net) | 352.97 | 313.44 | |
(i) | Non-current tax assets (net) | 43.72 | 58.12 | |
(j) | Other non-current assets | 52.46 | 126.59 | |
B. Total non-current assets (A) | 6,774.39 | 6,884.66 | ||
Current assets |
- Financial assets
(i) | Trade receivables | 2,660.06 | 2,503.99 | |
(ii) Cash and cash equivalents | 1,764.62 | 1,573.50 | ||
(iii) Bank balances other than cash and cash equivalents | 714.89 | 943.69 | ||
(iv) | Other financial assets | 660.23 | 805.52 | |
(b) | Other current assets | 381.42 | 435.06 | |
Total current assets (B) | 6,181.22 | 6,261.76 | ||
Total assets (A+B) | 12,955.61 | 13,146.42 | ||
EQUITY AND LIABILITIES | ||||
A. Equity | ||||
(a) | Equity share capital | 118.31 | 118.31 | |
(b) | Other equity | 5,588.91 | 5,996.06 | |
(c) | Non controlling interest | 2,407.00 | 2,407.00 | |
Total equity (A) | 8,114.22 | 8,521.37 |
Liabilities
- Non-currentliabilities
- Financial liabilities
(i) | Borrowings | 16.80 | 16.94 |
(ii) | Lease liabilities | 623.11 | 631.14 |
(iii) Other financial liabilities | 13.29 | 12.01 | |
(b) Provisions | 296.70 | 282.00 | |
Total non-current liabilities (B) | 949.90 | 942.09 |
- Current liabilities
- Financial liabilities
(i) | Borrowings | 707.54 | 562.24 | |
(ii) | Lease liabilities | 112.78 | 101.45 | |
(iii) Trade payables | 408.29 | 370.76 | ||
(iv) | Other financial liabilities | 1,279.92 | 1,535.15 | |
(b) | Other current liabilities | 871.64 | 634.21 | |
(c) | Provisions | 370.94 | 342.15 | |
(d) | Current tax liability (net) | 140.38 | 137.00 | |
Total current liabilities (C) | 3,891.49 | 3,682.96 | ||
Total liabilities (B+C) | 4,841.39 | 4,625.05 | ||
Total equity and liabilities (A+B+C) | 12,955.61 | 13,146.42 |
6
R Systems- Earnings Press Release March 31, 2024
Consolidated Operational Data (Un-audited)
Profitability in Percentage | Quarter ended | |||||||||
Mar 31, 2024 | Dec 31, 2023 | Mar 31, 2023 | ||||||||
Revenues | 100.00 | 100.00 | 100.00 | |||||||
Gross margin | 33.71 | 33.96 | 33.63 | |||||||
SG & A | 19.32 | 18.52 | 20.18 | |||||||
Adj. EBITDA | 14.39 | 15.44 | 13.45 | |||||||
EBITDA # | 12.84 | 15.44 | 13.45 | |||||||
EBIT # | 8.87 | 11.37 | 10.94 | |||||||
EAT | 6.60 | 11.02 | 8.87 |
- Before non-recurring cost.
Revenue from Top 10 | Quarter ended | ||||
Clients | Mar 31, 2024 | Dec 31, 2023 | Mar 31, 2023 | ||
Top 10 Clients | 22.66% | 22.30% | 24.67% | ||
Top 5 Clients | 15.19% | 15.35% | 17.22% | ||
Top 3 Clients | 11.74% | 11.86% | 13.12% | ||
Largest Client | 6.20% | 6.24% | 7.15% |
Revenues by Geographies | Quarter ended | |||||||||||||
Mar 31, 2024 | Dec 31, 2023 | Mar 31, 2023 | ||||||||||||
North America | 74.53% | 73.75% | 74.63% | |||||||||||
Europe | 9.80% | 9.96% | 10.12% | |||||||||||
Southeast Asia | 12.24% | 12.96% | 12.45% | |||||||||||
India | 2.18% | 1.95% | 1.66% | |||||||||||
Others | 1.25% | 1.38% | 1.14% | |||||||||||
Total | 100.00% | 100.00% | 100.00% | |||||||||||
Utilization (including trainees) | Quarter ended | |||||||||||||
Mar 31, 2024 | Dec 31, 2023 | Mar 31, 2023 | ||||||||||||
Onsite | 96.89% | 96.21% | 96.76% | |||||||||||
Offshore | 77.42% | 76.16% | 72.54% | |||||||||||
Blended | 80.37% | 79.11% | 75.87% |
7
R Systems- Earnings Press Release March 31, 2024
Consolidated Operational Data (Un-audited)
Human resources | As at | |||||||||
Mar 31, 2024 | Dec 31, 2023 | Mar 31, 2023 | ||||||||
Technical | 3,644 | 3,643 | 3,921 | |||||||
Software services | ||||||||||
Onsite | 564 | 539 | 538 | |||||||
Offshore | 2,368 | 2,436 | 2,397 | |||||||
KS | ||||||||||
Offshore | 699 | 644 | 957# | |||||||
Trainees | 13 | 24 | 29 | |||||||
Support | 541 | 548 | 547 | |||||||
Total count | 4,185 | 4,191 | 4,468 | |||||||
# includes 416 counts transferred under BOT in September | 2023. | (Rs. in mn, except DSO) | ||||||||
Key Balance Sheet Data | As at | |||||||||
Mar 31, 2024 | Dec 31, 2023 | |||||||||
Receivable including unbilled | 3,318.68 | 3,222.94 | ||||||||
Receivable in days ("DSO") including unbilled | 62 | 64 | ||||||||
Cash and bank balance # | 1,146.81 | 1,338.32 | ||||||||
Total equity attributable to shareholders | 5,707.21 | 6,114.37 | ||||||||
# net of short-term borrowing and amount set aside for dividend | ||||||||||
Development/Service Centers Location | As on Mar 31, 2024 | |||||||||
Covered areas in | No. of seats | |||||||||
sq. ft. | ||||||||||
India | ||||||||||
Noida | 202,220 | 3,165 | ||||||||
Pune | 15,810 | 150 | ||||||||
Chennai | 5,905 | 65 | ||||||||
North America | 223,935 | 3,380 | ||||||||
Sacramento, CA | 9,500 | 60 | ||||||||
Ontario & Vancouver, Canada | 1,734 | 16 | ||||||||
APAC | 11,234 | 76 | ||||||||
Singapore | 5,544 | 56 | ||||||||
Malaysia | 6,434 | 81 | ||||||||
Thailand | 1,534 | 13 | ||||||||
Indonesia | 2,571 | 58 | ||||||||
China | 1,675 | 13 | ||||||||
Europe | 17,758 | 221 | ||||||||
Romania | 23,659 | 177 | ||||||||
Poland | 10,756 | 94 | ||||||||
Moldova | 4,499 | 60 | ||||||||
Total | 38,914 | 331 | ||||||||
291,841 | 4,008 |
8
R Systems- Earnings Press Release March 31, 2024
Notes:
- US$ equivalent figures are derived by converting the Rupee figures using average rates for profit & loss items and closing rate for balance sheet items.
- Previous period's figures have been regrouped wherever applicable, to the extent possible, to conform to the current period presentation.
About R Systems
R Systems is a leading digital product engineering company that designs and builds next-gen products, platforms, and digital experiences, empowering clients across various industries to overcome digital barriers, put their customers first, and achieve higher revenues and operational efficiency. Further, our knowledge service offerings cover revenue cycle management, back-office service, technical support, and customer care using multi-lingual capabilities and global delivery platform.
We constantly innovate and bring fresh perspectives to harness the power of the latest technologies like cloud, automation, AI, ML, analytics, Mixed Reality, etc. Our 4,100+ technology expeditioners across eighteen (18) development and service centres are driven to explore new digital paths, leaving no stone unturned in our quest to deliver services and solutions that drive meaningful impact.
Our product mindset and engineering capabilities allow us to partner with the key players in the Tech industry, including ISVs (independent software vendors), SaaS companies, and product companies in Telecom, Media, Fintech, Insurtech, and Healthtech verticals.
Safe Harbor:
Investors are cautioned that this presentation contains forward-looking statements that involve risks and uncertainties. The Company undertakes no obligation publicly to update or revise any forward- looking statements, whether because of new information, future events, or otherwise. Actual results, performance, or achievements could differ from those expressed or implied in such forward-looking statements.
For further information, please contact: | |
Nand Sardana | Kumar Gaurav |
Chief Financial Officer | VP Finance & Accounts |
Tel # 0120 - 430 3506 | Tel # 0120 - 408 2650 |
Email: nand.sardana@rsystems.com | Email:kumar.gaurav@rsystems.com |
Bhasker Dubey | |
Company Secretary & Compliance Officer | |
Tel # 0120 - 430 3566 | |
Email:bhasker.dubey@rsystems.com |
9
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
R Systems International Limited published this content on 03 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 May 2024 06:40:08 UTC.