WNS (Holdings) Limited

Good morning, and welcome to the WNS Holdings Fiscal 2022 Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in listen-only mode. After management's prepared remarks, we will conduct a question-and-answer session, and instructions for how to ask a question will follow at that time. As a reminder, this call is being recorded for replay purposes. Now, I'd like to turn the call over to David Mackey, WNS's Executive Vice President of Finance and Head of Investor Relations. David?

Thank you, and welcome to our fiscal 2022 fourth quarter and full year earnings call. With me today on the call, I have WNS's CEO, Keshav Muragesh, WNS's CFO, Sanjay Puria, and our COO, Gautam Burai. A press release detailing our financial results was issued earlier today. This release is also available on the investor relations section of our website at www.wns.com. Today's remarks will focus on the results for the fiscal fourth quarter and full year ended March 31, 2022. Some of the matters that will be discussed on today's call are forward-looking. Please keep in mind that these forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, Those factors set forth in the company's Form 20F. This document is also available on the company website. During this call, management will reference certain non-GAAP financial measures which we believe provide useful information for investors. Reconciliations of these non-GAAP financial measures to GAAP results can be found in the press release issued earlier today. Some of the non-GAAP financial measures management will discuss are defined as follows. Net revenue is defined as revenue less repair payments. Adjusted operating margin is defined as operating margin excluding amortization of intangible assets, share-based compensation, and goodwill impairment. Adjusted net income, or ANI, is defined as profit excluding amortization of intangible assets, share-based compensation, goodwill impairment, and all associated taxes. These terms will be used throughout the call. I would now like to turn the call over to WNS's CEO, Keshav Murugesh. Keshav.

Thank you, David, and good morning, everyone. We are pleased with WNS's financial results in the fiscal fourth quarter and our overall performance in fiscal 2022. Net revenue for the fourth quarter came in at $275 million, representing a year-over-year increase of 20.4% on a reported basis and 21.9% constant currency. Sequentially, net revenue increased by $14 million or 5.3% on a reported basis and 5.4% constant currency. In the fourth quarter, the company added 10 new logos and expanded 33 existing relationships. WNS also delivered strong adjusted operating margins of 21.5% and grew adjusted EPS by 33% year over year. Sanjay will provide further details on our fourth quarter and full year financial performance in his prepared remarks. While the company executed extremely well and delivered solid financial results this past year, fiscal 2022 was not without its challenges. During the year, WNS successfully navigated significant pandemic-related business volatility across our 12 global delivery locations, including the impacts of the Delta and Omicron surges. The fluctuating infection rates resulted in shifts back and forth between work from office and work from home, and volume changes with several key clients as well. In addition, increasing digital demand across industries combined with global labor shortages created resource supply pressure, which impacted our compensation costs and attrition rates. Despite these obstacles, fiscal 2022 was a milestone year for W&S. The company accelerated full-year revenue beyond the $1 billion mark, delivering organic constant currency growth of more than 16%, our highest rate since becoming a public company in 2006. In addition, we signed 36 new clients, and expanded 108 existing relationships, which also represent record high levels. In support of top-line management, WNS added more than 8,000 net employees, pushing our global headcount past the 52,000 FTE mark. Full-year revenue growth was broad-based across all segments of our business, including continued progress in servicing internet-based clients. In fiscal 2022, revenue from these digital disruptors grew 29% year-over-year and now represent 19% of total company revenue. From a delivery perspective, WNS successfully managed the pandemic-related volatility and resource supply constraints, serviced our clients' rapidly evolving BPM requirements, and maintained our industry-leading margins at 21.4%. We were able to achieve these margins while continuing to make the necessary strategic investments in areas such as domain expertise, technology-enabled solutions, digital consulting and transformation, advanced analytics, cybersecurity, and the training and reskilling of our global employee base. As a result of our efforts, adjusted EPS in fiscal 2022 grew more than 25% to $3.41. I'm also pleased with the progress the company continues to make on the ESG front. This past year, WNS was able to prioritize our employees' safety and welfare during a global pandemic, enhance cybersecurity protocols for both in-office and at-home delivery models, take steps to reduce our carbon emissions, improve our diversity and inclusiveness metrics as reflected in the 2022 Bloomberg Gender Equality Index, and expand our corporate social responsibility efforts through the WNS Cares Foundation, including support for displaced families in UK. Additionally, WNS has kicked off efforts towards adoption of the science-based targets and the United Nations Global Compact Initiatives and is actively evaluating additional ESG standards and frameworks which are most relevant to our business. We also plan to release our second annual corporate sustainability report in May. While we are happy with our fiscal 2022 performance, we are equally excited about the opportunities for WNS in fiscal 2023 and beyond, including a robust BPM demand environment, differentiated positioning in the market, and healthy business momentum. Today, we continue to see increased demand for BPM solutions as clients look to leverage technology and automation to help transform their business models as well as achieve their strategic goals. Key objectives include optimizing efficiency and cost, leveraging data and analytics to enhance decision-making, improving the end customer experience, and generating new revenue streams. Increasingly, clients also recognize the need to partner with a firm like W&S who can help them design, build, and run their business processes. The decision to partner is being driven by the client's need for access of specialized talent, digital technologies, process expertise, domain top leadership, and speed to market. With this favorable demand backdrop, WNS enters fiscal 2023 with a healthy pipeline and strong top-line momentum. Our deal pipeline, which is broad-based across verticals, services, and geographies, is the healthiest it has ever been. The pipeline continues to transition towards higher-end services and solutions including digital consulting and transformation, advanced analytics, and domain-centric offerings. We are also seeing more large end-to-end transformational opportunities in the pipeline and reduced sales cycles for the expansion of existing relationships. Part of the pipeline health is the result of an expanded farming opportunity which is directly attributable to the acceleration of new logos signed over the past few years. Today, we have 147 clients of more than $1 million to farm, with 103 of these clients currently generating only $1 million to $5 million annually. These relationships provide us with a solid foundation for growth and excellent expansion opportunities, and as we help these clients move forward with their strategic BPM initiatives. In addition, we exit fiscal 2022 with improved revenue momentum, having accelerated our year-over-year constant currency revenue growth over the past three quarters. WNS also has the opportunity for a continued recovery in our travel vertical, which has the potential to add 2% to our top-line growth rate as and when volumes return. All of this momentum comes with the added benefit of our recurring, highly visible, as well as resilient business model. That being said, as a company, we must remain vigilant with respect to pandemic-related volatility and incremental challenges in labor supply, wage inflation as well as attrition. We also recognize the need to invest in our business both organically and inorganically based on the long-term opportunity in the BPM space. The company has built a strong M&A pipeline and we are working diligently to find the right assets, leverage our healthy balance sheet and accelerate our capabilities. I am confident that we have a focused discipline process in place for evaluating opportunities and we will continue to follow this approach which has proven to be successful for us. In summary, we believe that the market for BPM services driven by digitization has never been better and that WNS remains extremely well positioned to capitalize on this opportunity. The company will continue to focus on driving best-in-class execution, investing to differentiate our capabilities, and fostering our corporate culture of innovation and co-creation. We believe these efforts will enable WNS to deliver long-term sustainable business value for our clients, shareholders, employees, as well as global communities. I would now like to turn the call over to our CFO, Sanjay Puria, to further discuss our results as well as outlook. Over to you, Sanjay.