EXL Reports 2017 Second Quarter Results

Thursday, July 27, 2017

2017 Second Quarter Revenues of $189.1 Million, up 10.9% year over year

Q2 Diluted EPS (GAAP) of $0.58, up from $0.47 in Q2 of 2016

Q2 Adjusted Diluted EPS (Non-GAAP) of $0.70, up from $0.55 in Q2 of 2016

NEW YORK, July 27, 2017 (GLOBE NEWSWIRE) — ExlService Holdings, Inc.(NASDAQ:EXLS), a leading operations management and analytics company, today announced its financial results for the quarter ended June 30, 2017.

Rohit Kapoor, Vice Chairman and CEO, commented, “In the second quarter of 2017, EXL had strong revenue growth. Our second quarter revenue was $189.1 million, an increase of 10.9% year-over-year, and we generated revenue of $372.1 million in the first half of the year, an increase of 10.2%. Revenue growth for the second quarter was led by our analytics segment which grew 30.2% year-over-year. Our operations management business grew 5.1% year-over-year.

“EXL is becoming the strategic digital transformation partner of choice. Our clients use our next-generation operations management, robotics, advanced analytics and domain expertise to transform their business models. Our pipeline across our portfolio of solutions is strong as evidenced by 16 new client wins this quarter.”

Vishal Chhibbar, CFO, commented, “We have increased our revenue guidance for 2017 to $748 million – $762 million from $740 million – $760 million to reflect better performance in the second quarter and favorable exchange rates versus the U.S. dollar. Our guidance represents annual revenue growth of 9% to 11% from 2016 on a constant currency basis. We have also increased our adjusted diluted EPS guidance for 2017 to $2.54 – $2.64, an increase of 9% to 13% from 2016. Our balance sheet remains strong with cash and short-term investments of $237 million.”

Financial Highlights: Second Quarter 2017

We have six reportable segments: Insurance, Healthcare, Travel, Transportation & Logistics, Finance & Accounting, All Other (Banking & Financial Services, Utilities and Consulting) and Analytics. Reconciliations of adjusted (non-GAAP) financial measures, including those reflecting constant currency, to GAAP measures are included at the end of this release.

  • Revenues for the quarter ended June 30, 2017 increased to $189.1 million compared to $170.5 million for the second quarter of 2016, an increase of 10.9% both on a reported and constant currency basis from the second quarter of 2016, and an increase of 3.3% sequentially from the quarter ended March 31, 2017 earnings.
  • Operating income margin for the quarter ended June 30, 2017 was 8.5% compared to 9.5% in the second quarter of 2016 and 8.7% for the quarter ended March 31, 2017. Adjusted operating income margin for the quarter ending June 30, 2017 was 13.1% compared to 13.7% in the second quarter of 2016 and 13.9% for the quarter ended March 31, 2017.
  • Diluted earnings per share for the quarter ended June 30, 2017 was $0.58 compared to $0.47 for the second quarter of 2016 and $0.48 for the quarter ended March 31, 2017. Adjusted diluted earnings per share for the quarter ended June 30, 2017 was $0.70 (includes one-time income tax benefit of $3.1 million or $0.09 of diluted earnings per share from conclusion of an uncertain tax position) compared to $0.55 for the second quarter of 2016 and $0.60 for the quarter ended March 31, 2017.

Business Highlights: Second Quarter 2017

  • Won 16 new clients, consisting of six new clients in our operations management business and 10 new clients in analytics.
  • Opened our state-of-the-art Digital Experience Center in Jersey City, New Jersey for collaboration to design and architect digital solutions that transform clients’ businesses.
  • Opened new delivery centers in Chennai and Hyderabad and expanded our operations centers in Kochi, Noida and Gurgaon.
  • Introduced LifePRO® Version 19 with enhanced capabilities for management of complex annuities.
  • Achieved Leader placement and Star Performer recognition for second straight year in the “Everest Group PEAK Matrix™ for Analytics BPS”.
  • Positioned as a Leader in “IDC MarketScape for Finance and Accounting BPO Services”.
  • Honored with 2017 LOMA Excellence in Education Awards for Insurance Training.
  • Expanded multiple operations management relationships, including migrating 97 new processes.

2017 Guidance

Based on current visibility, the Company is increasing its guidance. This guidance is based on the following exchange rates for the remainder of the year: U.S. Dollar to Indian Rupee exchange rate of 64.50, British Pound to U.S. Dollar exchange rate of 1.30, U.S. Dollar to the Philippine Peso exchange rate of 50.5 and all other currencies at current exchange rates.

  • Revenue of $748 million to $762 million, representing an annual revenue growth of 9% to 11% on a constant currency basis.
  • Adjusted diluted earnings per share of $2.54 to $2.64, representing an annual increase of 9% to 13%.

Conference Call

ExlService Holdings, Inc. will host a conference call on Thursday, July 27, 2017 at 8:00 A.M. ET to discuss the Company’s quarterly operating and financial results. The conference call will be available live via the internet by accessing the investor relations section of EXL’s website at ir.exlservice.com, where an accompanying investor-friendly spreadsheet of historical operating and financial data can also be accessed. Please access the website at least fifteen minutes prior to the call to register, download and install any necessary audio software.

To listen to the conference call via phone, please dial 1-877-303-6384, or if dialing 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 for a period of at least twelve months.

About ExlService Holdings, Inc.

EXL (NASDAQ:EXLS) is a leading operations management and analytics company that designs and enables agile, customer-centric operating models to help clients improve their revenue growth and profitability. Our delivery model provides market-leading business outcomes using EXL’s proprietary Business EXLerator Framework®, cutting-edge analytics, digital transformation and domain expertise. At EXL, we look deeper to help companies improve global operations, enhance data-driven insights, increase customer satisfaction, and manage risk and compliance. EXL serves the insurance, healthcare, banking and financial services, utilities, travel, transportation and logistics industries. Headquartered in New York, New York, EXL has more than 26,000 professionals in locations throughout the United States, Europe, Asia (primarily India and Philippines), South America, Australia and South Africa. For more information, visit www.exlservice.com.

Continuing Statement Regarding Forward-Looking Statements 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 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 Securities and Exchange Commission, including EXL’s Annual Report on Form 10-K for the year ended December 31, 2016. These risks could cause actual results to differ materially from those implied by forward-looking statements in this release. You should keep in mind that any forward-looking statement made herein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come up from time to time, and it is impossible to predict these events or how they may affect EXL. EXL has no obligation to update any forward-looking statements after the date hereof, except as required by federal securities laws.

For a full view of EXL’s financial tables, click here