“WNS’s performance in the fiscal first quarter continues to highlight our differentiated positioning in the BPM industry. In Q1, revenue less repair payments grew 8 per cent year-over-year, or 11 per cent on a constant currency basis. The company also posted solid results
across other key financial metrics including operating margin, profitability, and cash flow,” said Keshav Murugesh, WNS’ Chief Executive Officer.
Operating margin in the first quarter was 16.6 per cent, as compared to 12.6 per cent in Q1 of last year and 15.3 per cent in the previous quarter. On a year-on-year basis, margin improvement was the result of increased productivity, the impact of IFRS 16 lease accounting, and operating leverage on higher volumes.
Sequentially, margins improved due to the impact of IFRS 16 lease accounting, increased productivity, hedging gains net of currency movements, and operating leverage on higher volumes. These benefits more than offset headwinds from the impact of annual wage increases and higher share-based compensation expense, said the management.
“The company has updated our forecast for fiscal 2020 based on current visibility levels and exchange rates,” said Sanjay Puria, WNS’ Chief Financial Officer. “Our guidance for the year reflects growth in revenue less repair payments of 8 per cent to 13 per cent on both a reported and constant currency basis. We currently have 95 per cent visibility to the midpoint of the range,” he added.
While 44 per cent of the company's revenue comes from north America, 52 per cent of the its business is processed from Indian delivery centers with over 64 per cent of the headcount concentrated in India said the management. By vertical, revenue growth was broad-based with the healthcare, banking & financial services, manufacturing/retail/CPG, and travel verticals each growing at least 10 per cent year-over-year.
The company added 6 new clients in the quarter and expanded 11 existing relationships.
had recently announced its strategic contract win with the newly formed $1.8 billion capitalized Convex Group Limited, an international specialty (re)insurer based in the UK and Bermuda. “The company reported that the ACV (annual contract value) of the new client deals signed in fiscal 2019 was 35 per cent higher than new client deals signed in fiscal 2018. We believe the larger deal size for new clients is a function of increased comfort with a broader scope of work at relationship inception,” said Murugesh in an earlier response to queries about the BPM provider’s recent large deal wins.