EXLS - Earnings call transcript Q4 2019 | ExlService Holdings, Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Q4 2019 ExlService Holdings, Inc. Earnings Conference Call. [Operator Instructions].

I would now like to hand the conference over to your speaker today, Steven Barlow. Thank you. sir. ahead, go Please

Steven Barlow

Relations. Good Quarter thanks Results and Barlow, our of I'm Carol. York in joining Rohit are Conference everyone EXL's Steve Kapoor, Investor President Vice Fourth Year-end Chairman EXL's me morning, you, today We've to New and and had Investor Vice for Call. release With Thank Maurizio XXXX review our to Sheet and Officer; Financial we Executive Investor of opportunity this our Chief Relations our Officer. EXL's XXXX an earnings also We in the Chief website. Nicolelli, hope Fact issued morning. Financial that updated you've section QX

not unknown As are and cause could results of forward-looking. and the these such uncertainties some to you in in from documents to conference those the information actual limited from those time. risks and Such differ keep the conditions, by other we'll and to, uncertainties filed economic and mind release, implied that know, include, no assumes EXL this company's to subject discuss reports presented expressed risks call update the Commission Exchange press Please call. statements. are or forward-looking but in Securities that today's on on are periodic general this statements forth time with materially matters known to set obligation factors discussed

we to measures, Sheet. well During information Reconciliation as reference measures Investor our Fact may call press these believe be can GAAP provide useful which found we the non-GAAP financial certain investors. of in as release today, for our

to Officer. Rohit turn Kapoor, over EXL's Rohit? I'll now Executive the call Chief

Rohit Kapoor

was earnings celebrated report call. the first Welcome for everyone. morning, to our for anniversary a billion revenues I XXXX a annualized our as and XXth great pleased am We company surpassed year in Good year-end time. XXXX EXL. that Steve. you, $X Thank to

well resonating continue to proposition our favorable and very see demand a lines. and industries across is environment, value We service

of rate which $XXX.X XXXX, growth an basis. reported generated represents revenues annual XX.X% year we on of the million, a For

Health on X represents the in $XXX.X we we in organic revenues, of rate for fastest XX.X% reported years. Integrated, is a On X.X%, basis, rate generated past growth an which company Excluding the which by currency the million basis. grew a growth constant

have XXXX we from been winning the X.X% and currency X.X% in accelerating constant has XXXX. of growth large of rate engagements. fact, rate our scaling X.X% In our organic and multi-year transformational to been in up The acceleration in growth result XXXX

XXXX of for Our EPS was growth adjusted a XX.X%. representing rate $X.XX,

Integrated, our Excluding EPS to XX.X% adjusted Health grew $X.XX.

growth $XXX million Our Operations year-over-year. nicely X.X% representing in grew Management to revenues, business

up Operations of $XXX.X Integrated, by Health powered Operations was constant X.X% Management and growth Excluding a over for with Healthcare the was in consecutive Finance year-over-year & million XX% growth quarters. organic rate currency strong This X Management the double-digit half across second of year, generated revenues, Insurance, In particularly a on basis. an Accounting.

also million on year. currency and solid of business generated our another which on basis In XXXX, Analytics an had Our XX.X% growth a basis. of business revenue, XX.X% reported growth constant represents organic a Analytics $XXX.X

predictive management, including continues and of modeling resonate market. Our full well the analytics data very stack Analytics capabilities, to in advanced

XX% We In tripled past the are markets, of and In leader, new our now participating Data for market Gartner Magic inclusion established the the verticals by evidenced Analytics, years, the This by Service the Providers our larger, in Analytics today and differentiated scale as revenue are in more complex we both is X and Worldwide. in practice. new represents scope revenues. deals. Analytics EXL's has and total of Quadrant

our client constant quarter year currency engagements. small, of rate of full basis. and with by In on growth quarter. rate low-margin some remains for our messaging by the Despite our fourth the actions, year-over-year strong grew this growth Analytics at these exit consistent portfolio the quarter, rationalization mid-teens. last our X% Analytics impacted nonstrategic organic was business proactive This The is an

X I our in and and in discuss more for existing analytics. excellence and like management Now provide our would expansion large-scale growth future rate that EXL will One, for XXXX accounts; key two, centers to momentum into beyond: centers ability trends to drove growth accelerated many and build buying in data within XXXX of an and design global

buying a demonstrating across are leverage new clients Our to centers. capabilities appetite our greater

wide customer access a to across existing opportunities. a in buying Our new referenceability for participate executives deals partner strategic of new of us win as centers network has client EXL existing the of to and positioned these This C-level our clients. and variety our choice enabling is within

execution have This these a growth credibility satisfaction. and and high successfully a reflected engagements, client in win through amongst level built rates also in superior consistent on focus is trust turn rate in high We translates top our high of clients. into which our

XX top In XX.X%. year, XX.X%, grew top clients clients the past our and grew our XX

large SCIO. relationship recently health very a relationship meaningful example, a EXL through client national a acquisition expanded with its in we of For the way. our longstanding had plan with

of community selected provider have were the the claims settlement. combined of demonstrate the broader health and We client's to value the of precertification organization capabilities foundation across team. We from to to strong trust credibility able plans to a created support C-level the were we organization. the Moreover,

is to The and second data and our would call out global trend design to scale of ability like centers analytics I excellence.

partners these seeking a understand business up can are centers who rapid scale clients Our pace. at their and

multiple demonstrated model on across delivery and demand. industries space this helping global in is capitalize us this Our experience

broad large very well, Our approach the these focus on with to a engagements. especially lead and size of outcomes, business scope resonates given

to ability insights deals multiple proven of global win that and This drive expertise the and with point data execution. large buying analytics domain analytics helping is data us combine to at and centers. a have support We

to this Through win, domain support Latin This expertise selection generating compared analytics and X great P&C culmination of recent our in EMEA. our the insurance clients' Today, revenue years none business excellence a is global the and last across This demand in global Analytics to insurance well quick engagements implement markets as U.S. at functions. than this spans succession win multiple value management large of and chain analytics the trend Pacific to top multiple carrier XX a data excellence. create as analytics a more America, quarter. million insurance to example deal was $XX scale win X ability other a in our four business advanced This ago. win market-leading comes Asia support center in P&C we initiatives. clients is have center our to of our will testament annual One we of following transformation by and

to engagements. strong similar of a see continue pipeline We

XXXX analytics, Insurance, bringing capabilities structure was We The to changes streamlined Analytics and key together our in in business units: year industry-specific also verticalization key deeper lens. the Insurance structure operations, growth Emerging. Healthcare and our digital X Healthcare, of an and with by across data will our our organization organization and accelerate leadership.

Our Analytics business for advanced will a in data analytics investment will engine and solutions. our continue remain and growth EXL, expand to we

attracting to expand the build Finally, we and internally. well as practices. the same verticals the With unit of our significantly growth EXL. senior have At Emerging leadership, and executive opportunity business promoting for talent market-leading the of as our sources consolidates our this, including F&A and strengthen as we time, profitable invested new to parts committee, well have by other consulting as

We leaders expand drive enterprise-wide bandwidth also an diverse created to senior of executive committee to operating initiatives.

and Integrated successfully transitions have our time communicated appropriately now year. last employee Health am successfully client expectations, The enabled how and wind Integrated is exited we of will operations lines complete, charges no business going met we Health pleased the be more there our restructuring relationships. the Lastly, cost forward. early down within with I have managed

strong. Overall, pipeline our remains

our clients. is clients In strong and Operations to expand as end-to-end strategic digital engagements within transformation. continue that We with Management, pipeline existing well new drive deals win as our

healthy demand, to Our across Analytics spread also business and industries continues geographies. enjoy a

strong our into for XXXX. is momentum heading The business

clients Our being look and forward advanced XXXX can a partner who value business year from for technologies. generate as to great them another EXL I help models see reimagine EXL. strategic

Maurizio in data lastly, analytics us His will our to a employees clients, value new Nicolelli. large unique for our is for of for this and and He my rich month. a pleasure Maurizio to and perspective introduce and strong you And company. joined generate growth earlier and CFO, it our experience profitability driving global our background has stockholders.

With over that, to turn Maurizio. call I will the

Maurizio Nicolelli

year significant for XXXX, I'm I for XXXX. fourth warm into XX-year shareholder history, with potential company has Rohit, to years very forward-thinking the I tremendous by forward there you morning. outlook our be the our the I Thank value. look part itself welcome. joining achievements this is and that you, the that for team. quarter well-managed and to full in great opportunity a believe built Over EXL. for established both as a ahead, will insights provide us excited growth Thank EXL its financial for followed of has working

strong currency a EPS with On million, up and had million, $X.XX, adjusted year-over-year X.X% up a of year year-over-year, We quarter EPS of basis, basis, year-over-year. $XXX.X $XXX.X a full year-over-year. generated X.X% of of XX% up and revenues XX.X% we on revenues constant $X.XX, adjusted up

later by winding As of Health Integrated expenses will we Integrated order of Health will revenues results underscore in remarks. financial impact the My Integrated down discussion process core I performance you be the December Health my of encompassing completed separately the excluding business discuss of in the are to aware, and the business. XX.

All a revenue growth numbers are on constant currency hereafter mentioned basis.

grew For year-over-year. up segments, growth quarter, defined from is Finance segments. revenues XX $XXX.X was reportable Accounting as Operations Healthcare, excluding growth the quarters. from our the X%. This the highest revenues XX% year-over-year. we generated & and Insurance, Revenues Sequentially quarter, driven in million, of business, million, third by Management This double-digit by Analytics, $XXX.X XX.X% X growth totaled in up rate

was both This double-digit a continued Insurance strong was the existing growth and client XX.X% new client performance businesses. XXXX XX.X%. improvement and L&A growth. the with in growth expansion by This existing year-over-year management. care P&C clinical relationships in in ramp-up the showed in revenue with expansion driven wins client by driven of year-over-year relationships growth its area our of growth of Healthcare of

new grew financial in continued This by Sequentially, by XXXX. X% insurance. XX.X% perform million, the ramp-up to revenues over of Finance $XX.X QX. the relationships Analytics grew totaling up X.X% XXXX new and existing driven was wins wins year-over-year. banking client in in growth Accounting and well services and Analytics and client expansion year-over-year & both client driven with

due Adjusted investments points capabilities. for XX.X%, in was XX operating the down to margin basis digital quarter year-over-year

rate for XX.X%. tax the GAAP was Our quarter

quarter the for $X.XX, EPS year-over-year. adjusted up Our X.X% was

our to XXXX Integrated. moving Now performance, Health excluding

Our million, organic Accounting our in growth On This Insurance, the basis, which the year we an growth & Finance X revenues highest by Analytics in up Healthcare, growth year-over-year. grew double-digit is XX.X% years. rate X.X%, were driven for $XXX.X was segments. and

This year-over-year. also growth rate grew X.X% Our Operations and year-over-year XX.X% the grew is business an an Management years. on XX.X%. Analytics organic organic basis on in X highest grew basis

points and margin adjusted $XXX investments was increased the by from for digital year. million, the Adjusted year developments. Our operating XXXX capability EBITDA XX year for year-over-year, was the X.X% down basis the up in driven solutions XX.X%,

year Our XX.X%. the GAAP was tax rate for

of an million and with higher XX%. sheet. excess We year impact last rate discrete compensation, was was exited capital in the to increase to The EBITDA from We on period $XXX.X deferred year, tax period revaluation normalized prior XX.X% $XX.X of the the for year namely the the better very management. of up our million Excluding XX.X%. operations same items, working for and benefits strong benefit was balance a tax cash $X.XX, generated taxes, year-over-year. due compared flow increase stock our EPS Adjusted

on and $XX.X million; million in We revolving cash million, of strong during $XXX.X resulting and of Contributing cash sales in to investments ended an facility. of of our the $XXX.X outstanding our $XX.X amounting $XX XXXX included: cash an days expenditures; in $XX improvement and repurchase days December average reduction borrowings of expended position net of short-term cash capital X was our $XX.X to days. XXX,XXX XX at shares million credit to at a million with million flow the Uses of by price year-end.

operating better year, for I'm Health December business. XX, to Integrated adjusted we completed an to $XX.X basis were our leading as Revenues Now points, of of $X.XX quarter. Health discuss EPS our by loss Integrated to the as million diluted has happy $X.XX like XXX been Integrated for for down year. I Integrated indicated than reconfirm the Health last the we would wound contractual adjusted commitments. briefly that margin Health

million. for impairment restructuring addition, In and $X.X the we recorded of year, charges

As the adjusted onetime costs are costs, excluded exit are they from EPS.

guidance our to moving for Now XXXX.

X%. year-over-year This constant current We revenue guidance X% are $X.XXX $X.XX rates. to currency represents of providing billion to of growth billion at exchange

Integrated, are Health relationships constant XXXX transformation digital client in a existing main currency our to drivers we within as wins. footprint represents our this this expansions Excluding growth growth. X% increased client The for and X% revenue client universe year-over-year

gains million compensation income between million million, million. expenses of expect exchange $X and stock $X and intangibles We $X $XX amortization million million $X $XX foreign between ranging million, and interest million, to $XX between net and of $XX

We the XX%. to rate tax of the expect effective XX% in to be range

cash allocation repurchase a combination $XX million, of debt reach, program. execution capabilities of range flow the will acquisitions expenditures repayment share expand capital with and that geographic Our our free the be the our in and investment XXXX $XX of in operations in million to our of

share our covering that authorized the December repurchases through years in announced We had million $XXX to in XXXX XXXX. Board up

factors, over period. expect share to to which in be count average an above Our Based to adjusted XXXX our is to of for XX%. XX% $X.XX, EPS intention $X.XX amounts the weighted keep the we increase of to flat on our this range

expect In growth Integrated revenue adjusted quarter, excluding outperformance of quarter. due the first the Health we and sequential flat the fourth to EPS

in and and Emerging report our results our As based from on starting to align inherent Insurance, operational press we Analytics of quarter our business in strategic business XXXX, the units: with release, Healthcare, business. will first X certain structural changes mentioned

built the released our details to after in segment refer details will on today. market press closes more and change release For XX-K the reporting, in that be our

organic EPS analytics revenue insurance, is solid X.X% year-over-year. XXXX. as up and currency year-over-year adjusted in and delivered business constant $X.XX, conclusion, basis XX.X% healthy healthcare of Rohit In We of and a growing the growth mentioned, traction very in on with

are XXXX, our verticals strong our meeting of visibility and with revenue profitability goals. All performing well with very into are we and confident

Now, would be I Rohit questions. take to and happy your

Operator

[Operator Instructions].

of Nolan Your the with first William Maggie from Blair. question comes line

Ted Starck-King

Ted, on for Maggie.

you that work transformational or amount to changes the transaction And more has shift how how the towards become contract? outcome-based based? outcome-based you - you of larger margin with profile Are contracts seeing more as they types FTE in complex, have the and changed So and how that compared clients? that does of of contracts does

Rohit Kapoor

Sure.

work digital a shifts that expand is end-to-end, things centers of these larger multiple and arrangement existing it So that as The of clients. one buying delivering contracts tangible much these more nature do more we within the happens across focused become that the is also lot becomes size outcomes. transformation and commercial on business

involving engage been for clients has business clients it experience EXL. win-win as Our with commercial is outcomes, a constructs that for actually we in situation our as as well

and outcomes are able to very create deliver to tangible so. businesses those value make We confident clients' being the participate in business that and by to and we of improvements doing execute our

general, outcome-based are businesses, pure those, which on margin our The in of on basis. FTE higher is a structure than

and to a course, to of time be is, for there get able us efficiency However, that level lead to contribution. that

advantage of is playing take to very trend is this positioned So think in a that. very marketplace, that favorable out EXL the I well and is

Ted Starck-King

That's Great. really helpful color.

to as here a switching over So follow-up. then healthcare

complete, change approach is you best how Health talk And the that the now wind within Integrated then go-to-market of the segment? could within your expansion substantially opportunities down about for the the does Healthcare segment vertical? So

Rohit Kapoor

Yes.

amount operations new marketplace. our we attention pleased and to client is healthcare vertical leadership here. and the broad-based of our relationships the relationships and franchise The and We very, growing and focus with us know, that capabilities existing there So with clients extremely insurance entire the you huge we've serve healthcare data Integrated very that as with market, of team our healthcare in a for in are all of out healthcare built industry analytics. be large can industry is adding the on developing up With vertical. Health investments think behind our to able on clients around management us, opportunity

within a payers, have clinical XX the We vertical. work and X amongst industry this operations leadership positioning in of with the particular particularly in top payers healthcare, we

growth our areas. and much space the rate provide propel going rest of capability healthcare allow forward. and well related pharmacy expand will much our in us actually as to EXL us get for to is We to us The in are in opportunity as EXL allow and more engaged one base looking healthcare more towards the a set which as to of compared growth customer provider faster rate the other

by excited healthcare. opportunity very in we're the So

invested significantly healthcare We've also understands very talent, in the well. leadership really which domain really,

So very, we healthcare we the XXXX, executives acquisition brought talented senior industry in practice are experts. a that of added with SCIO, our number and, of senior on executives very course, in of healthcare industry

this we what for are in positioned about beyond. XXXX So we we well do excited we can think are industry and vertical very and

Operator

from comes Needham. with question next of Your Tandon Mayank line the

Kyle Peterson

Kyle actually is Petersen, on from This Mayank.

to going Is the down? that margins color just this with from expansion year. make the build going from about to margin the is start Or how Integrated should to benefit sure big I we of the that the the wanted progression. the throughout How we're think benefit on want Just and should that step wound about operations drag I Health year? be appreciate margin being up? kind way. to a right those thinking

Maurizio Nicolelli

Yes, it's Maurizio.

to incremental for a earlier then our we're offset digital by in find at really areas making. that months really and improve couple XXXX of year XX looking and slightly that's last XXXX. result our operating process Health our basis around at ended So operating see points, XX.X%. to margin for adjusted - adjusted that's XXXX We behind during XX and Integrated about XX% point margin us. hurt by in specifically margin that's efficiencies through basis with XXX a us investments, the improvement the right going We planning And different of it, for

Kyle Peterson

seemed are of you in strong to soft And That's that trends guys noticed then business. a elsewhere in seeing compared the those good a the little color. revenue the utilities I U.K. Great. lot

Just in two Or just to are expand want connected? to is wanted see on kind there on little want might call to bit? specific either going guys of see, things out, anything those could you you those that of a if

Rohit Kapoor

Sure.

focused So and our it largely is based practice U.K. there. is utilities out

was Our flat as in XXXX. U.K. much pretty XXXX business compared to

focus the We we opportunity which a will some The take U.K. pipeline that. continue think this in is this think industry something been something, to into that actually to us we geography, us which be for other along focused has in industry get verticals on stronger Emerging attention have able business actually be go-to-market in that's We our so the to advantage to leadership focus vertical utilities able it folded will invested expect consolidated this growth size, continue. will to allow of in be to in market, going and our provide much more on. And and We in manner and a think a scale, with and that in refocus be we in - unit. U.K., don't is us the deserves. our it able there's allow that we'll to efforts U.K. to

opportunity us new we engine forward. for EXL growth think to huge So a a going create there's for

Operator

next comes the from Cantor question Your Foresi line Fitzgerald. of Joseph with

Joseph Foresi

believe says I that's Analytics. how wanted back remember for But I not - ask Invesco, far us about I I that how - sure what we're revenue. how about go. Anyways, to that Rohit, both old in can't sorry, I'm the of billion $X I'm back to Conseco, headed how are.

about growth the of you of of business. I some you're the short-term said And like the low-quality that Why you're developed I think expectations of long-term? you seems divesting you the now? were of reevaluating do and talk know rate now? business. some It that direction in you're Maybe kind why realignment partnerships kind that could doing of that you about business there. talked being your

Rohit Kapoor

Sure.

up to us we been a really be been over XX deliver Joe, a this So, while, grow business set and quite and we think a is and on, going to that fact Analytics value-added for it's is delighted great tremendous. it's position we exciting. build It's up The the to X, early to able really franchise next segment journey, we're to we've be continue for yes, right forward, with the X, is ending in clients. analytics and built that data now where but a years, us really opportunity a are And invested market-leading opportunity going analytics. services the our in we data that

for be it with skill well with the and just and the opportunity us market got set internally, matches very it's well in, capabilities and to So that and place going a we've great the forward. talent we've that very the got it aligns

growth Analytics, things I this strategic more accounts such that to prune of which healthy a is growth-oriented which, years of very of we is be continue focus on One grow in management, in something portfolio we got down the part is and and going build accounts. healthy doing that can the we've which forward. portfolio making after our and This think, undertaken very profitable larger are in portfolio to sure that needs to business several rapid very, and can

and We the of data focusing are we that. on also opportunity data Analytics and have dimension expand a tremendous management, business our to on

focused also strong really machine advanced of up building on that that. again, And capabilities got are around AI We we've capabilities leverage analytics learning. and in

other to partnership of these but capabilities, of externally few available them develop in Now are will we partners other providers us. and develop that will with a we internally, many

allow Over number to partnerships built agencies. some cloud. with We've be with credit a data of analytics the past the and great of partnerships migrated up few with infrastructure years, partnerships providers We've rating the up that built to we've providers. win up built

with operate. And we've are so the we market-leading created and think field us we going advantage which forward, our expand really, is analytics to going should to take be able that. to playing huge. of partnerships these allow We become really And position, a number of to that big in going

are we that. so And about very excited

Joseph Foresi

there. on past on about M&A? I a the of Maurizio, Health initial been, as thoughts Any going into record planning meet way with practice? area spotty thoughts then, how specifically you're make again, you And your particular obviously, our There's any track that Integrated, focus on Okay. And particular any business? guess then

Maurizio Nicolelli

work working just mention, that couple We've to high are business. strategic that really And Joe, areas of it's the initiatives really business so for really of on $X of And that forward with group a X to really kind weeks discussions opportunity around the regarding in. and Couple to it getting is gotten with business with are M&A. our me my strategy team for double growing the for scale given I'm grow really things of we're us really the one but the see the things really staring the of is right the those both significant. accelerate at business to of M&A, to really go billion, is by really us. opportunity focus by growth, as rest it our combination kind will M&A us and internal a you'll our help business. of the the And with that but a then number supplemented supplement really internal also had growing help forward. And growth arms and going we've of us

in this be the also And that but and of another we're of area also various in focus for that return ensuring businesses, getting M&A capital going the then we highest return our will projects me, in various really forward. the implement it's capital,

say, me those areas really would X big to are initially, focus really I So on. for

home businesses, business. and on in we working each all really of M&A front, whereby piece that strategy the the at restructure of are ourselves, to for the On our look we different now really the with particular leaders we one that's each

Operator

Bryan with line Cowen. question Your of Bergin the from comes next

Bryan Bergin

us starting for wanted fiscal you've start what that to HI in range? And baked 'XX? to there's to prudence and given to X% a revenue of can you growth bridge the there, level Management wondering the Ops you 'XX the call out? us I the on here, anything Can growth organic Just sense are Analytics are the give had ex X% accelerating into help ranges of X.X% growth. at else fiscal if

Rohit Kapoor

Sure, Bryan.

currency between to we previously, Operations stated are Analytics our an grow for expect Management basis. X% to currency basis, that's we rates medium grow XX% between be as at would to that X% on rate growth And expectation to term, X% on our the XX% at expect a the blended for We the for provide constant growth between we the would would to enterprise organic So expectations XX%. medium constant term. and

that you take of rate was in XXXX that of top X%, range. The an for rate so constant that is it the was it's XXXX, at If on a look we've the X.X%, growth right our a provided at that ballpark. middle so currency X% between guidance very end organic growth to and basis in

progresses, year up. going we're terms guidance think where the of in we we'll provide end As updated to

Bryan Bergin

us Okay. Can it you give quantify half a that XQ? second or whether or within Analytics was sense weighed, the amount the pruning in

Rohit Kapoor

which quantification to do. that, something difficult Bryan. It's provide not That's of a we

we for expectation projections. to continue it earnings And As our in term quarter. consistent we be the mentioned this be the first Analytics that longer as it in will this full portfolio quarter, in the well. rationalization. third the - going that By will something our time, will last of year with expectation that call, And fourth is this our quarter complete for continued is is with in XXXX which fully XXXX be we began the in

Bryan Bergin

Okay.

more uptick gross piece? for on your and Ops just heard view margin, talk a that Analytics you that Now so I is curious, it digital, you there. had the investments both? in sustainability? is nice in Or about just Can just your Management

Rohit Kapoor

Sure.

our portfolio. why our it So fourth demonstrated reason better rationalize hurts growth quarter even the we that and short one it a improves the our rationalization of getting our being profitability, would portfolio Analytics Analytics clearly the business. of and And revenue rate in term, margin, you and though the is see that's advantages can rate for the in growth

manage our and continue expectation able that business to Analytics go-forward we is be sustain that margin a the transition. to improvement basis that in Our able to on will be

multiple and lot we the it's a across solutions, forward, focusing to going Management be buckets. to on in across levers, Ops into be around of and going And think across will digital Going Operations and make, data across In Operations number all digital different we the other they're going be that Management, Management going management to process again, across these investments be Analytics. so we're both fall and robotic using and to analytics, be more we're smart Analytics, across workflow to Analytics. automation, investments those technology capabilities advanced are that going will ways made

Operator

Your JP of Morgan. comes question with line Puneet from next the Jain

Puneet Jain

focus Rohit, organization, in centers buying or changes within client we teams? require that as of structure multiple the pursue sales will development business and

Rohit Kapoor

require definitely change it our think strategy. go-to-market will of a I Puneet, Yes,

are First conversations the we need the and having client And more is professionals that clients. of our executives C-level therefore, senior more of we of existing those organizations. to have executives conversations having more seasoned with with our all, the C-level now

existing Second, a relationship that enhance more new more something it. going client of in and cuts clients. our our to just be entire for business we start a rather managers, articulate much significantly our cuts that a digital client across be able also is conversation got do enterprise will a which it's investment lot to lines so buying across strategic to piece applicable as we It much transformation of that vision for centers, we've mean that's than the work for more with will to

be client with existing to of is on our definitely, front the profile, clients. managers quantum in there going investment our So end in associated shift a and the relationship

Puneet Jain

from impact, you any direct impact whether or any on coronavirus your on in And derivative And that? are decision-making positive any travel sales from cycles impact negative, it. Got other or volume or clients' seeing or vertical? any

Rohit Kapoor

its way coronavirus clients let comprehensive So address asked its question. you've and impact on since and that me EXL a in

as the you needs dealt all, situation, the know, monitoring focused First utmost urgency. on extremely which, evolving, with is are and we it to rapidly be of

to priority one security and safety sure number employees and ensure of of businesses. client we we custodians make is Our our great that our the are that

focus. So our that's

So seen our with associated not real our business for far, clients. impact we've for any or coronavirus

really concentration diversified. clients our in well hence Fortunately that's We industry, for that's geared of portfolio in not don't our us, and a client pretty is so travel impacting us. something the have

adopted we've our precautionary number a in few keep order A all which you One, things, of safe, to should know. steps. employees

started now. which guns to temperature our got in sanitizers be temperature address preparedness our is done we've to this. facilities, So plans there's able monitoring, at all to we've provide place through And at facilities of

We them of what don'ts, are advisory effect. significant letting also of a do's in our are displayed travel being have the at very communication up our some with And and these have very, a we manner and in know course, points. stepped employees vantage

likely it in impact of The and are don't by updating constantly place, is We business with impact likely currently. with clients. have therefore, be are industry this U.S., the which these all. should countries sharing impacted. there the practices plans, our an will which have in at virus to get best do any or industry is And any our contingency in of healthcare in monitoring healthcare the adopted I And us of the is of China these And industry state in there think the clients vertical these, one vertical, a vertical. the spreading not recommended basis plans on Health we We do Organization. to impacted World

plans of no that and clients into very extent real said, to so so there's we be employees we're clients, that help just and to current the I we're we arise. the like keep to has it react just happened, that prepared can seeing. preparedness moment, and this are safe that should our And contingency developing with best are able At there's out impact to possible. our our going a need nothing the But high so we address state

Operator

Your the question Baird. Koning from comes Dave of next with line

David Koning

I question, new like and the momentum And this about one everything. is The new XX, year job. guess, it seems growth. like of are driving clients believe. were the Clearly, question, a seems the my good clients lot it Nice first I

last think you're I the XX. bigger in just Is than year, year last in a were prior the clients just are a composition lot there the different the like ones year? winning there

Rohit Kapoor

Dave. Yes,

think new I change of there's terms the no client real in wins.

up of quality we've the prospects clients a as as signed we've we in up that up that and XX we the If at think clients good it's the that XXXX. of signed in growth the new you take signed clients XXXX, look new

clients. playing obviously, well. We're terms really, existing much in that is out rate that from take also that, see of growth place really growth can traction You seeing, more our

and growth and that here. existing out we the mix clients and very track balance record the And actually So think healthy. our of very should between new clients good is continue

David Koning

is interesting group. most And is we then Emerging think Okay, you Emerging typically, being great. think kind reacceleration segmentation, acceleration the as segments think growth. new me on companies what's are going the is new we had in great and tremendous to the And where faster there; last strong; Healthcare, Insurance; the to be. when of analytics you've of of

to business. right going that it's far by slowest the of maybe even part the way about growth to think it? think I be Is the

Rohit Kapoor

and portfolio. we a way the an leadership keep portfolio us place get and unit set do to the up, that. mind, track. be business, is attention able is Emerging to is the Emerging growing think it on presently, And fix our profitable are opportunity we'll it portfolio But as So the is putting business most a there well. our by slower do We think in growth to for focus on this into to be by we able that it

have go for within to as also will act some growth. that catalysts portfolio this into opportunity verticals an industry new We

are we a excited for unit be and us. going highly growth-oriented expectation a some business from also opportunities for these will is being business into unit unit. the our areas Emerging creating so about profitable growth apart the that And over of long-term to And new us, of mid- really

David Koning

kind assume you're one. roughly conversion had, wouldn't you've flow - final Free the it one like that of is but was like just is I ever And cash maybe you best I what maybe that's thinking? Great. XXX% crushed Okay. it, conversion sustainable, think

Maurizio Nicolelli

- Yes, Maurizio. it's about that

flow see year forward. strong the go a this as year prior flow, our benefits there, as So of operating because cash versus free we $XXX saw had maybe free million up in not strong growth of but business significant in going that. especially the million. you DSOs, cash one-timers couple benefiting significantly line, very at still our cash had of But We flow we in free from positive steady overall, our should $XX because we year a had

Operator

with comes I'm Your next sorry, from Barrington the Research. Vincent Colicchio, of question line

Vincent Colicchio

particularly of in added clients a large most them Rohit, answered, quarter, you strategic potentially? mine but excited Yes, about X client were you becoming are any the of the

Rohit Kapoor

think, I think for we meaningful us, on, Vincent, and we've So and been client is opportunity very said, like growth adding quality the these I of the new very significant. relationships clients that

that in clients. You we now have see Analytics, can

are expand on years, our annual clients clients, $XX several of do kind and that above Operations types X of we clients, new those think relationships of we've well added which as in Management have are In which We the And business, to we grow that revenue. have their million get that and over levels. well of clients, magnitude. these some

Operator

Your next Stifel. Grossman question comes with from David the line of

David Grossman

really know So don't specifically Rohit, you about I speak bookings.

maybe with the However, can XXXX the bookings of share booking little versus perhaps you trends talk about bit And XXXX? just us in cadence a the throughout year?

Rohit Kapoor

David. Sure,

terms pipeline, when larger as look our So It's very the year, previous all, and can the to the the so increased and pipeline which has more that become in out, scale color mature, of a provide pipeline has is size. at positive. that's best pipeline take in guess, I the value in a I lot become much has is broadened you we size - has compared and first of something significantly to

are is, how our win are new of winning we it quite part in of actually we pleased second deals. with terms The rate,

our center deal Of continuing that then a well. buying good satisfaction very at new and as obviously and pace rates ability win client, credibility that's we've an high, working with existing to that it course, that's so high our and if on from existing our a a the with is win clients, trust new customer really established and are well. And driven at of levels new is clients,

you growth our faster and we won much a guidance think to and think for XXXX, rate are we've and pleased out. when in shaped then that we able as have in expect about that has kind amount business of bookings that's of we very when we with to the XXXX, And provided the played up that XXXX. So in be how in growth maintain us reflecting in rate

David Grossman

you color Right. have vis-à-vis give - on how on where to same through at But any visibility how they run expect last - you year how in bookings, how through us much versus XXXX much right XXXX? that you ran can were XXXX you And those the any time? now

Rohit Kapoor

depends it be in for even of is want think for data we provide don't quickly of sharing depends and of on grip externally. to just Yes, how able amount that a because the get something clients to it's And And David. on contract, there terms the difficult We therefore, upon that tenure inconsistency a to that real externally it feel ourselves ramp just with the that it's internally, which up. that. data data us, we fair don't and comfortable very buying

David Grossman

enough. fair Okay,

that is going think about specificity more So And really down the healthcare what on give do after that you wind the today? how of areas business? are up any really to now healthcare What and the in came of that that Integrated are are you behind question evolve? driving this Health us just vertical. here you relevant really be and What the offerings about - can And in you, you you earlier expect terms focused core - I think can offerings grow? you those

Rohit Kapoor

Yes.

we So pharmacy providers; by it the up first Number healthcare the at would going payers; number analytics of break providers; look business two sciences PBM the a developing. and and a of be strongest three management side vertical, have is into of the X pharmacy, got we've groups: with and the that one data on we've a we be strong and and and And on payers; take life all, if you would we're number after, care PBMs. companies got is the the and the you the practice type some would business clinical with clients nascent break and care that the our up existing penetration the it pretty of with

we are after. the would those segments So X broad that go

we or are services care providing services. of registered management the a and here, qualified What it services that are number out of we is nurse requires clinical is kind a one or The capabilities kind help these nurse to are helping the review, of precertification in management, with. to utilization procedures, the our that to doctor way processes a clients like or certain settlement all claims out be able utilization

underwriting, management and population do analytics. how The data providers, around and and risk. are see work risk being payment they abuse, health as they that able as for waste and managing with the of integrity as what our our helping a about area plans move that think area should they second really healthcare We clients and are is self-insured programs the fraud, to in kind towards lot is around know, as of in well you

from these and, we - the to provide population on capability have a are taking ability new delegated also a health therefore, management some customers, and of us of that platform decisions We is for behalf authority end-to-end our type groups of that on on. requests our the added their that we've clients provides terms We've also a visibility that on coming to capabilities and the of ensured. that in they've added - more lot transparency in are

it's of industry. So have offerings service whole the that healthcare for we variety a

that investment and to validates is in players, industry this healthcare rate in space, the our able evolving the vertical. we be marketplace, and here. very few in certainly, are the there And the players, to play hope And benefit are healthcare which rapidly out XXXX I a think growth traditional

David Grossman

And last question. X just Okay.

And some you prepared I have Just your in remember talked you in about that, can't remarks. the Q&A that partners you mentioned or had Analytics.

channel So as Or are are as they well? a those partners acting just adding capabilities? partner actually

Rohit Kapoor

So both. they do

give me you let So an example.

a they analytics, smart partnership also a development comprehensive We've a as like a and KYC, capability on HSBC these manner to and you ground - distribution a expanding capability well distribution with capabilities we around as we've for that taking as for with and advanced as of provides then it as act well much that other are CECL us have analytics. invested partnered know, We've analytics client, about out We providing along platform and it decisioning partner and company to TransUnion a some in as more a capability in for EXL. partner a is a capability and for there clients. test becomes with the implementing market for a channel will

use in with terms formats in to providers clients a space that's going the And partnerships think very such. we're fast-evolving I space. analytics So and of as multiple

Operator

Fargo. line question Your Donati of the and final Wells from Justin with comes last

Justin Donati

margin The you first if a at expansion. given $X.XX guidance one, of And growth, $X.XX to seems EPS, correctly, the excluding relative for $X.XX, you bit I that projecting year at it the to you're Health Integrated. when revenue heard ended look I little low

can So headwinds through you some walk me and kind there? the of of tailwinds

Maurizio Nicolelli

It's Maurizio.

that have correct. You

loss adding at the we So year of $X.XX ended back to gets the $X.XX, you $X.XX.

year, revenue. Our is guidance it the for to the initial X% which $X.XX, is our guidance $X.XX growth based X% of is to on

that line the And other - right year of revenue so all operating right given margin I our improvement for below to $X.XX, ranges update And it. And that XX% our that items goes you the range. with still And the to up middle along, around you margin. adjusted again, of a as that X.X% the we'll the with around right will middle is bit around $X.XX, growth get initial gave little gets right to guidance. on

Justin Donati

me. last just question then And Okay. for

both a the in about You technology that you're making talked the lot of investments sides business.

X I that sized about think the million previously, $XXX years. you've at past over

a run level think higher, with consistent So should basis annualized about we an or that rate lower? on

Rohit Kapoor

Yes.

going that to on investment is be consistent hypothesis. our So I that with think much pretty

we of be as investments will and those we scale traction of our digital up in as the of company of see size the investments. stepping grow terms some We commercialization build the and up

go up expect investments should tick in forward. as of a those we terms you So

Operator

further time. Mr. make? are no at there questions Barlow, would are any to this There like remarks you closing

Steven Barlow

Thank No. Carol. you,

listening. we you 'XX Thank earnings We call, are the end presenting concluding to our of the forward and for April. look at QX all

Operator

and gentlemen, you for conference participating. Ladies this call. Thank concludes today's

You now disconnect. may

ExlService (EXLS) 29 Feb 202019 Q4 Earnings call transcript