Quess Corp Ltd : Latest Quarterly Results Analysis

BPO/KPO company  Quess Corp announced Q2FY23 results:

• Q2FY23 revenue is up by 32% YoY, driven by General Staffing (up 36%), Comtel (up 48%) and ConneQt (up 24%)
• EBITDA from operations for Q2FY23 is up 20% YoY to Rs 135 crore
• EBITDA margin has declined due to:
  • The slowdown in IT Staffing and Selection business ­
  • Investments in Staffing business in the US
• YoY PAT is down marginally by 4%
• Q2FY23 OCF / Operating EBITDA conversion at 72%

ED & Group CEO Guruprasad Srinivasan said, “We are happy to announce that we crossed the 500k headcount milestone driven by the highest ever headcount addition of 33.7k in the quarter. All our large businesses have continued to demonstrate high growth, with our consolidated revenues going up by 32% YoY and 7% on a QoQ basis. However, sluggish hiring in IT sector has impacted our higher margin businesses of IT staffing and selection. We have taken initial steps towards building our staffing presence in USA. While this investment may have some margin impact in the short term, we strongly believe that this investment will open up new growth avenues and improve margin profile of the business. Buoyed by record headcount addition, we are now focused on improving our margins.”

Result PDF

BPO/KPO firm Quess Corp announced Q1FY23 Result :

• Quess Corp Q1 PAT up 52% YoY, highest headcount addition of 32.6k recorded in the quarter
• Q1 FY23 revenue up by 33% YoY driven by General Staffing (up 34%), QITS (up 33%), and ConneQt (up 33%)
• EBITDA from operations for Q1 FY23 is up 4% YoY to Rs 153 cr. EBITDA margin has declined due to:
  • Increased cash burn in Product Led Business
  • Increase in SG&A / Revenue from 5.2% to 5.6% due to higher salary cost, annual increments and Increased spend on technology
  • IFM EBITDA margin declined by ~220 bps YoY, due to contract re-negotiation with a major customer
• YoY PAT is up by 52%
• Q1 FY23 OCF / Operating EBITDA conversion is at 56%

Commenting on the results, ED & Group CEO Mr. Guruprasad Srinivasan said, “We are delighted to report our highest ever headcount addition of 32.6k in a quarter along with a PAT growth of 52% YoY, reaffirming our execution capability. All our large businesses have continued to demonstrate exceptional growth, driving our consolidated revenues up by 33% YoY and 5% QoQ. As we get into the festive season, usually the largest hiring season in India, we continue to invest in technology and have strengthened our business teams to take advantage of this opportunity. We are confident these investments will help gain market share and take our ROE to 20%."

Result PDF

Quess Corp declares Q4FY22 result:

• Quess Corp posts highest ever annual Revenue and PBT
• FY22 revenue of Rs 13,692cr up by 26% YoY, driven by General Staffing (up 28%), QITS (up 42%), and Conneqt (up 28%)
• FY22 EBITDA from operations of Rs 668cr up by 16% YoY
• FY22 PAT of Rs 251cr up by 241% YoY
• FY22 OCF / Operating EBITDA conversion at 79%
• Net cash position sustained at Rs 16cr in FY22 against Rs 34cr in FY21

Commenting on the results, ED & Group CEO Mr. Guruprasad Srinivasan said, “We are delighted to report our highest ever Revenue, EBIDTA & PBT, reaffirming our execution capability. All our large businesses have continued to demonstrate exceptional growth, driving our consolidated revenues up by 26% YoY and 3% QoQ. Our continued focus on cross-sell is yielding results as businesses and employees leverage our vast service portfolio to offer innovative solutions to our clients.

As a responsible corporate citizen, we strongly believe in giving back to the society- besides renovating infrastructure for 74 schools benefiting ~14k students and teachers, we have also made good progress on ESG front. Today, women constitute 29% of our core workforce – up from 26% in FY21 and over 93k employees hired by us this year enjoyed first time social security benefits. We are very optimistic about FY23 on the basis of feedback from clients and we will continue to focus on our joint goals of hitting and sustaining a 20% ROE while growing OCF at a 20% CAGR”

Result PDF

BPO/KPO firm Quess Corp declares Q3FY22 result:

• Revenue up 31% YoY driven by General Staffing (up 34%), IT Staffing (up 52%), and IFM (up 30%)
• EBITDA from operations up 19% YoY to Rs 179cr
• PAT up 94% YoY to Rs 89cr with operating leverage enabling the non-linear growth
• Q3’22 OCF / Operating EBITDA conversion at 67%. 9M FY22 conversion is at 80%.
• Net debt increased to Rs 108cr in Q3‘22 against Rs  68cr in Q2’22, in line with revenue

Commenting on the results, ED & Group CEO Mr. Guruprasad Srinivasan said, “We are delighted to report our highest ever Revenue, EBIDTA & PBT. Q3 saw continued opening of economy, providing tailwinds to our business. We continue to build upon the growth achieved in previous quarters. While our WFM & GTS platforms continue to outperform, our focus on tech assets have been as resolute as ever. We have successfully raised investments in Monster.com validating the progress made in our digital assets.

Being one of the largest domestic private sector employers, we take great pride in being employer of choice for our employees. We have been re-affirmed as Great Place to Work for 3rd year in a row. We will continue to stay focused on growth, accelerate technology led delivery, operational efficiencies, and stay optimistic about the times to come as we continue to focus on our goal of hitting and sustaining 20% ROE”.

Result PDF

Highlights:

• Revenue up 23% YoY driven by General Staffing (up 27%), ConneQt (up 27%), and Industrials (up 24%)
• EBITDA from operations grew 12% YoY to Rs. 157cr 
• PAT down 17% YoY due to Rs. 35 cr extraordinary non-cash charge 
• OCF / Operating EBITDA conversion at 100%
• Net debt position improved to Rs. 68cr in Q2’22 against Rs. 151cr in Q1’22 
• Interim dividend of Rs. 4 per share

Result PDF