Xchanging Solutions EBITDA surged on 134% in 2015 while Revenue decreased on 2.6%
26-02-2016 • About Xchanging Solutions (
$XCHANGING) • By InTwits
Xchanging Solutions reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Xchanging Solutions is a company in decline: FY2015 revenue growth was -2.6%, 5 years revenue CAGR was -3.4%
- EBITDA Margin is quite volatile: 10.0% in FY2015, 4.1% in FY2014, 10.1% in FY2013, 13.1% in FY2012, 3.1% in FY2011
- The company has business model with low profitability: ROIC is at 7.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Xchanging Solutions ($XCHANGING) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 5,518 | 2,088 | 2,431 | 2,870 | 2,795 | -2.6% |
| EBITDA | 169 | 274 | 244 | 119 | 278 | 133.7% |
| Net Income | 5,374 | 123 | 303 | 251 | 292 | 16.3% |
Balance Sheet
|
|---|
| Cash | 214 | 245 | 708 | 753 | 1,081 | 43.5% |
| Short Term Debt | 6 | 6 | 5 | 5 | | -100.0% |
| Long Term Debt | 9 | 9 | 13 | 16 | 9 | -42.4% |
Cash flow
|
|---|
| Capex | 137 | 72 | 50 | 52 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 65.8% | -62.2% | 16.4% | 18.0% | -2.6% | |
| EBITDA growth | -89.5% | 62.8% | -10.9% | -51.3% | 133.7% | |
| EBITDA Margin | 3.1% | 13.1% | 10.1% | 4.1% | 10.0% | 5.8% |
| Net Income Margin | 97.4% | 5.9% | 12.5% | 8.8% | 10.4% | 1.7% |
| CAPEX, % of revenue | 2.5% | 3.4% | 2.0% | 1.8% | | -1.8% |
| ROIC | 1.4% | 8.3% | 6.6% | 2.2% | 7.2% | 5.0% |
| ROE | | 5.0% | 11.5% | 8.6% | 9.2% | 0.6% |
| Net Debt/EBITDA | -1.2x | -0.8x | -2.8x | -6.2x | -3.9x | 2.3x |
Revenue and profitability
The company's Revenue decreased on 2.6% in FY2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 5.8 pp from 4.1% to 10.0% in FY2015.
Net Income marign increased slightly on 1.7 pp from 8.8% to 10.4% in FY2015.
Return on investment
The company operates at low ROIC (7.24%) and ROE (9.16%). ROIC increased on 5.0 pp from 2.2% to 7.2% in FY2015. ROE increased slightly on 0.55 pp from 8.6% to 9.2% in FY2015.
Appendix 1: Peers in BPO/KPO
Below you can find Xchanging Solutions benchmarking vs. other companies in BPO/KPO industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Vakrangee ($VAKRANGEE) | | 52.1% | 14.3% | 26.2% | 42.4% |
| Hinduja Global Solutions ($HGS) | | 44.8% | 27.6% | 26.3% | 12.1% |
| Eclerx Services ($ECLERX) | | 38.2% | 39.7% | 27.3% | 12.0% |
| Firstsource Solutions ($FSL) | | 12.1% | 25.0% | 10.2% | -2.3% |
| Allsec Technologies ($ALLSEC) | | 15.5% | 74.8% | -37.6% | -24.4% |
| |
|---|
| Median (5 companies) | | 38.2% | 27.6% | 26.2% | 12.0% |
|---|
| Xchanging Solutions ($XCHANGING) | | -62.2% | 16.4% | 18.0% | -2.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Eclerx Services ($ECLERX) | 55.9% | 40.4% | 38.7% | 42.0% | 33.5% |
| Vakrangee ($VAKRANGEE) | 15.6% | 17.8% | 24.7% | 27.4% | 26.0% |
| Firstsource Solutions ($FSL) | 14.5% | 8.7% | 9.9% | 11.7% | 12.5% |
| Hinduja Global Solutions ($HGS) | 14.6% | 11.9% | 11.3% | 13.0% | 11.3% |
| Tricom India ($TRICOM) | | | | | 5.8% |
| |
|---|
| Median (6 companies) | 14.6% | 11.9% | 11.4% | 13.0% | 11.9% |
|---|
| Xchanging Solutions ($XCHANGING) | 3.1% | 13.1% | 10.1% | 4.1% | 10.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Vakrangee ($VAKRANGEE) | 6.8% | 27.7% | 6.0% | 11.7% | 0.2% |
| Hinduja Global Solutions ($HGS) | 6.0% | 31.5% | 7.2% | 6.1% | 5.8% |
| Allsec Technologies ($ALLSEC) | 5.2% | 6.6% | 5.8% | 5.9% | |
| Eclerx Services ($ECLERX) | 7.0% | 5.3% | 4.0% | 2.5% | 6.5% |
| Firstsource Solutions ($FSL) | 2.1% | 2.3% | 1.4% | 1.2% | 1.5% |
| |
|---|
| Median (5 companies) | 6.0% | 6.6% | 5.8% | 5.9% | 3.7% |
|---|
| Xchanging Solutions ($XCHANGING) | 2.5% | 3.4% | 2.0% | 1.8% | |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Eclerx Services ($ECLERX) | 83.3% | 61.1% | 58.7% | 62.4% | 41.0% |
| Vakrangee ($VAKRANGEE) | 17.1% | 20.2% | 21.3% | 28.3% | 36.4% |
| Hinduja Global Solutions ($HGS) | 9.9% | 8.1% | 8.2% | 12.4% | 11.0% |
| Firstsource Solutions ($FSL) | 7.0% | 4.0% | 7.0% | 9.0% | 9.5% |
| Allsec Technologies ($ALLSEC) | -8.7% | -13.0% | 19.9% | -40.1% | -26.5% |
| |
|---|
| Median (7 companies) | 11.9% | 8.1% | 8.2% | 12.4% | 11.0% |
|---|
| Xchanging Solutions ($XCHANGING) | 1.4% | 8.3% | 6.6% | 2.2% | 7.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Firstsource Solutions ($FSL) | 4.3x | 4.2x | 4.2x | 2.8x | 2.5x |
| Hinduja Global Solutions ($HGS) | -3.0x | 0.8x | 1.7x | 1.5x | 1.4x |
| Vakrangee ($VAKRANGEE) | 1.1x | 1.9x | 1.4x | 0.9x | 0.6x |
| Tricom India ($TRICOM) | 2.1x | 2.1x | 4.6x | | 0.0x |
| Eclerx Services ($ECLERX) | -0.1x | -0.7x | -0.5x | -0.7x | -0.6x |
| |
|---|
| Median (5 companies) | -0.0x | 1.3x | 1.4x | 1.2x | 0.6x |
|---|
| Xchanging Solutions ($XCHANGING) | -1.2x | -0.8x | -2.8x | -6.2x | -3.9x |
