WNS (Holdings) Limited

Good morning, and welcome to the WNS Holdings Fiscal 2023 Second Quarter 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 would 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 2023 second quarter earnings call. With me today on the call, I have WNS's CEO, Keshav Muragesh, WNS's CFO, Sanjay Puriya, 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 second quarter ended September 30th, 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 Muragesh. Keshav?

Hey, thank you, David, and good morning, everyone. WNSS fiscal second quarter financial results continue to demonstrate the strength and resiliency of our business despite the challenging macro environment. Net revenue for Q2 came in at $289.3 million, representing a year-over-year increase of 13.7%, on a reported basis and 20.4% constant currency. Sequentially, net revenue increased by 5.3% on a reported basis and 8.2% on a constant currency basis after adjusting for foreign exchange. Our acquisition of Huram contributed approximately 3% to growth both year over year, as well as sequentially, and integration plans remain on track. In the second quarter, WRF added nine new logos and expanded 21 existing relationships. Sanjay will provide further details on our second quarter financial performance in his prepared remarks. Today, I would like to share a few illustrative examples of the positive impacts WNS's digital transformations are having for our clients. Last year, one of our larger insurance clients came to us with a requirement to reimagine several mission-critical business processes in order to help them improve their customer focus as well as market positioning. Key challenges for the client were elongated claims, meaning the life cycles around it, low customer experience scores, quality and scalability problems stemming from a heavy reliance on manual effort, and the need for an improved digital transformation roadmap. Critical processes in scope included claims management from a customer's first notification of loss to recoveries and settlements, policy administration, underwriting, sales and service, and the overall customer experience. Working closely and collaboratively with the client WMS was able to co-create an end-to-end digital transformation program designed to meet and exceed their key business objectives. You know, the final solution was developed using our design thinking workshops from our onshore as well as onsite innovation centers that we have spoken about in the past to reimagine key processes digital consulting to understand requirements, intelligent automation to reduce manual activity and enable faster processing with lower risk, predictive analytics to optimize business performance, and agile delivery to drive collaborative cross-functional execution with the client stakeholders. We deployed a combination of both proprietary as well as third-party platforms and digital tools leveraging artificial intelligence, RPA, machine learning, cognitive, intelligent automation, as well as gamification. As a result, WNS was able to deliver a 15% reduction in cost, an increase of approximately 20% in digital customer self-servicing, a decrease of almost 30% in claims processing time and an improvement in customer satisfaction scores from 6.8 to nine out of 10. This shift to digital has driven an increased scope of services with this client and has jumpstarted discussions for the addition of more complex and high value opportunities. Similarly, for a large UK utilities client, WNS was asked to help with multiple business challenges, which resulted from Brexit, the COVID pandemic, and more recently, the impacts on gas and electric costs from the Ukraine-Russia conflict. These disruptions resulted in spiking customer call volumes, long wait times, and low first call resolution rates, which in turn, resulted in very poor customer satisfaction scores. The WNS solution, which leveraged our proprietary experience digital platform, as well as domain-centric resources, was implemented to address the client's needs across seven customer experience channels, including voice, email, chat, social media, messaging, web, and mobile. In a period of approximately 12 months, WNS was able to help redesign the client's web portal, significantly enhance their self-service module, embed analytics to improve interactions, optimize capacity, and reduce end customer effort. As a result, the WNS experience digital solutions drove an increase of over 50% in digital channel adoption, reduced customer wait time by more than 50%, increased customer satisfaction by double digits, and reduced total cost by 7%. In addition, WNS has been able to successfully leverage the success of this solution to drive contract wins with both new and existing clients across multiple verticals. We believe that these two case studies are representative of the meaningful business improvements WNS is now generating for all our clients with our digitally focused and transformational solutions. I would also like to provide you today with a brief update on our ESG initiatives. WNS continues to make strides in setting formal ESG goals, driving improved performance, reporting our progress, and integrating ESG into our strategic objectives. Recently, WNS joined the United Nations Global Compact in support of achieving the 2030 Sustainable Development Goals. The UNGC's social initiatives and environmental objectives are closely aligned with our company's values and the priorities highlighted in our most recent corporate materiality assessment. In addition, the company expects to sign our commitment letter with SBTI or science-based targets initiative this quarter, which will include formal plans to achieve a net zero standard. From an operational perspective, we continue to focus on reducing our carbon footprint wherever possible. Over the past year, WNS has now shifted our facilities to green electrical energy in the Indian states of Maharashtra as well as Karnataka. As a result, 81% of our overall power consumption in India is now green or renewables. Plans are already in place to expand this initiative to our remaining locations in India, as well as other countries where WNS has operations. We are also focusing on continuous improvement in our human capital management efforts, especially in the areas of training and employee development. We believe these investments are critical to the long-term health of our business. Providing a nurturing and healthy work environment and preparing our workforce for the future will enable WNS to continue to attract and retain top level talent and meet the changing needs of our clients. In fiscal 2022, the company provided over 4 million hours of training to our people globally, or an average of 86 hours for every WNS employee. In support of these efforts, the company spent more than $14 million on learning and professional development. From a reporting perspective, last month we released our second annual corporate sustainability report and launched a dedicated online ESG microsite. These sources now include additional important ESG information and help make the company's policies, data, and strategy easier to access. As we look into the second half of this fiscal year, we continue to see strong broad-based demand for BPM solutions as clients aggressively look to leverage technology and automation to improve their competitive positioning and reduce cost. This trend, we believe, will remain largely independent of the macro environment WNS is very well positioned to capitalize on these trends by leveraging our differentiated capabilities and ongoing investments in domain technology as well as analytics The company will continue to focus on superior execution best-in-class financial performance and Delivering long-term value for all of our key stakeholders including clients employees investors, suppliers, as well as the communities that we live in. I would now like to turn the call over to our CFO, Sanjay Puria, to discuss further our results and outlook. Sanjay. Thank you, Keshav.