Newgen Software reports Revenues of
Rs 661 cr in FY’20, Revenues from Cloud Business up by 60%
Company helps enterprise customers
adapt to the uncertain environment
with its low code digital automation
platform
The management of Newgen Software Technologies Ltd. announced results
for the Quarter and Financial year ended 31 March 2020 at its
Board Meeting
held on 26 May 2020.
Speaking
about the results, Mr. Diwakar Nigam, Chairman & Managing Director, Newgen
Software Technologies Ltd. said – “An uncertain environment calls for
extraordinary steps by an organization. During the COVID-19 pandemic, Newgen’s
pre-emptive measures, business continuity processes and robust IT
infrastructure ensured quick control and seamless transition to remote working
environment. Our solutions, developed on our low code digital automation
platform, are of mission critical nature for our long term customers. They
serve as the backbone of their operations. During this COVID-19 time we ensured
their continued operations and business continuity. The Company focused on
health and safety of employees while fully supporting clients worldwide. I
would like to take this opportunity to thank all our employees for showing such
dedication towards work.
Our
business has heavy dependence on the fourth quarter. However, fourth quarter
performance was lower than expected impacted by new business deferments due to restrictions
imposed globally starting in February 2020 and the subsequent evacuation
operations; as well as continuing economic and banking sector slowdown in India
market.
While
in the short term the environmental challenges are expected to continue to lead
to delay in new deals signings, we believe that today, the relevance and requirement
of our digital solutions for enterprises is more than ever. We are thus transforming
ways of working by aggressively pursuing cloud deployments across the globe.
We believe that our annuity revenue streams from existing
customers would help maintain stability in revenues. Our concerted efforts
towards more efficient operations and cost optimization for cash preservation
would help us maintain a healthy liquidity position during this phase.”
Key Consolidated Financial Highlights (FY’20) – [Y-o-Y
Comparison]
·
Revenue from operations
(Consolidated) up 6.5% YoY at Rs 660.8 crores as compared to Rs 620.6 crores in
FY’19. The business has heavy dependence
on the fourth quarter impacting the overall performance. During the year,
Newgen witnessed growth across the board in its key geographies. India,
however, continued to face challenges on account of economic sluggishness in
NBFC and Banking as well as banking consolidation.
o Annuity Revenue streams
(ATS/AMC, Support and Cloud/SaaS) were at Rs 368.6 crores. Cloud/SaaS deployments are rapidly increasing in
all geographies – US, APAC, India, as well as in the EMEA region. Cloud
Revenues were Rs 38.3 crores and witnessed a growth of 60% YoY.
o Revenue from Sale of
Products/ License were at Rs 117.7
crores
o
Implementation & Digitization revenues were at Rs 174.5
crores
Profit after tax down
at Rs 72.7 crores on account of slower growth in top-line and continued
investments in R&D & Sales and Marketing efforts.
Key Consolidated Financial Highlights (Q4 FY’20) – [Y-o-Y
Comparison]
·
Revenue from operations (Consolidated) at Rs 190.8 crores as
compared to Rs 204.0 crores in Q4 FY’19 due to delay in new deal closures on
account of COVID-19 related lockdowns and restrictions imposed globally.
·
EBITDA* was at Rs 51.9 crores and Profit after tax was at Rs
41.5 crores.
*Earnings before Interest, Tax, Depreciation
and Amortisation, adjusted for other income
Key Business Highlights
(Q4 FY’20)
·
Seamless transition to
remote working environment: Company implemented its business continuity plan, executed
just-in-time requisition and provision of computers, enabled VPNs and internet
connectivity, and provided team collaboration tools.
Today, 90% of the
workforce across locations is efficiently working remotely with data security
and compliance. Newgen is ensuring seamless customer services by leveraging
digital
connectivity to successfully execute each stage of project deployments
(from requirements
gathering, to project planning, to implementation and
production support) as well as sales
and marketing efforts
B Banking and Financial Services vertical continued to be our largest
vertical
comprising
60% of revenues during the quarter followed by Government/ PSU
(10%), BPO/IT (7%)
and Healthcare and Insurance (6% each). Low presence in
currently impacted
verticals due to the pandemic.
·
Prestigious customer wins: 21 new customer additions
in Q4 FY’20 including:
o Large project with a
leading Pan-African financial institution, offering banking services to more
than 18 million customers, across 1,000 business offices and customer touch
points in 20 African countries
o License Agreement with a
key government ministry in India
o 4 cloud agreements in the
US including a deal with a leading provider of property casualty insurance
for auto, home and business
o Mid-sized project with one
of the largest Bahamian banks with $1.7 billion in assets
·
R&D Efforts:
o
Received Patent for Mark Detection System and Methodology from
US Patent Office
o
Secured Patent for a System and Method for Automatic
Quality Assessment of Digital Documents
·
Product Launches: Company’s new version of
the product iBPS has low code capabilities and cloud deployments which are very
relevant today. Newgen also launched an enhanced version of Customer
Communication Management product suite that enables users to easily create,
design, and manage HTML email communications.
·
Strategizing new offerings: Newgen is developing and
deploying new solutions under the Paycheck Protection Program to help
financial institutions quickly process and forgive loans under the various monetary
and fiscal interventions introduced by governments globally to to stabilize
economic conditions. The Company is prioritizing SaaS based delivery models
with all geographies increasingly moving in that direction.
·
Received approval for setting up a unit in the IT/ITES
SEZ in Noida, Uttar Pradesh from
Development Commissioner of Noida Special Economic Zone
Other Highlights
·
Appointment of Ms Padmaja Krishnan as Non- Executive
Independent Director of the company w.e.f. March 24, 2020
