Q2 Results: Hexaware Expects To Sustain Margin At 15-14% In 2019 Despite Headwinds
Hexaware Technologies reported an 80-basis-point margin expansion in the second quarter of the calendar year.
Hexaware Technologies Ltd. expects to sustain its margin in 2019 as better utilisation and operational performance counter industry headwinds.
The information technology company reported an 80-basis-point margin expansion in the second quarter of the calendar year. While it expects the third quarter to be even better, there might be a dip in the fourth quarter, said R Srikrishna, chief executive officer.
“It’s a fairly normal pattern for us where we have sort of depressed margins in the fourth quarter and first quarter and then we have sharp recovery in the second and third quarter,” he told BloombergQuint in an interaction. “There are a number of cyclical factors behind it.” The company’s performance in 2019 will be similar to that of of 2018, he said.
That comes as India’s IT industry undergoes higher talent costs due to more expensive H1-B visas. The rupee also strengthened 0.41 percent during the quarter. This was countered by higher revenue growth, better utilisation and operational efficiency, he said.
Srikrishna expects revenue growth in the second half of the year to better that seen in the first half.
Key Earnings Highlights (QoQ)
- Income from operations up 3.5 percent at Rs 1,308 crore.
- EBIT rose 9.7 percent to Rs 191 crore.
- EBIT margin at 14.6 percent versus 13.8 percent.
- Net profit increased 9.4 percent at Rs 151 crore.
- Five new clients signed with total contract value of $36 million.