WNS Announces Fiscal 2021 Fourth Quarter and Full Year Earnings, Provides Guidance for Fiscal 2022

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Mumbai, Maharashtra, India & New York, United States – Business Wire India WNS (Holdings) Limited (WNS) (NYSE: WNS), a leading provider of global Business Process Management (BPM) solutions, today announced results for the fiscal 2021 fourth quarter and full year ended March 31, 2021.

Highlights – Fiscal 2021 Fourth Quarter: GAAP Financials Revenue of $243.9 million, down 1.8% from $248.3 million in Q4 of last year and up 2.3% from $238.4 million last quarter Profit of $27.5 million, compared to $29.5 million in Q4 of last year and $31.0 million last quarter Diluted earnings per ADS of $0.53, compared to $0.57 in Q4 of last year and $0.60 last quarter Non-GAAP Financial Measures* Revenue less repair payments of $228.3 million, down 3.2% from $235.8 million in Q4 of last year and up 1.7% from $224.5 million last quarter Adjusted Net Income (ANI) of $36.7 million, compared to $42.4 million in Q4 of last year and $41.0 million last quarter Adjusted diluted earnings per ADS of $0.71, compared to $0.82 in Q4 of last year and $0.79 last quarter Other Metrics Added 9 new clients in the quarter, expanded 27 existing relationships Days sales outstanding (DSO) at 30 days Global headcount of 43,997 as of March 31, 2021 Highlights – Fiscal 2021 Full Year: GAAP Financials Revenue of $912.6 million, down 1.7% from $928.3 million in fiscal 2020 Profit of $102.6 million, compared to $116.8 million in fiscal 2020 Diluted earnings per ADS of $1.97, compared to $2.24 in fiscal 2020 Non-GAAP Financial Measures* Revenue less repair payments of $868.7 million, down 3.1% from $896.2 million in fiscal 2020 Adjusted Net Income (ANI) of $141.7 million, compared to $161.4 million in fiscal 2020 Adjusted diluted earnings per ADS of $2.72, compared to $3.10 in fiscal 2020 Reconciliations of the non-GAAP financial measures discussed below to our GAAP operating results are included at the end of this release. See also “About Non-GAAP Financial Measures.” Revenue in the fourth quarter was $243.9 million, representing a 1.8% decrease versus Q4 of last year and a 2.3% increase from the previous quarter. Revenue less repair payments* in the fourth quarter was $228.3 million, a decrease of 3.2% year-over-year and an increase of 1.7% sequentially. Excluding exchange rate impacts, constant currency revenue less repair payments* in the fiscal fourth quarter was down 6.0% versus Q4 of last year and up 0.3% sequentially. Year-over-year, fiscal Q4 revenue was adversely impacted by the COVID-19 pandemic including lower volume requirements from certain clients and service delivery constraints resulting from the transition to a “work from home” delivery model. These headwinds more than offset the year-over-year revenue growth driven by new client additions, the expansion of existing relationships, and currency movements net of hedging. Sequentially, revenue improvement was driven by broad-based revenue growth and currency movements net of hedging, which more than offset a reduction in short-term revenue.

Profit in the fiscal fourth quarter was $27.5 million, as compared to $29.5 million in Q4 of last year and $31.0 million in the previous quarter. Year-over-year, profit reduced as a result of lower revenue driven by pandemic-related pressures and reduced high margin short-term revenue. Additional profit reductions included business continuity costs, higher share-based compensation expense, and a higher effective tax rate driven by the geographic mix of profit. These headwinds were partially offset by a non-recurring $4.1 million charge for goodwill impairment taken in the fourth quarter of fiscal 2020, reductions in travel, facility-related and discretionary expenditures associated with the COVID pandemic, and favorable currency movements net of hedging. Sequentially, Q4 profit decreased as a result of reduced high margin short-term revenue, increased facility-related expenses, and additional compensation costs including hiring in advance of revenue and employee promotions. These headwinds were partially offset by increased revenue, a non-recurring benefit of $0.8 million for interest income associated with a tax refund, and favorable currency movements net of hedging.

Adjusted net income (ANI)* in Q4 was $36.7 million, as compared to $42.4 million in Q4 of last year and $41.0 million in the previous quarter. Explanations for the ANI* movements on a year-over-year and sequential basis are the same as described for GAAP profit above with the exception of goodwill impairment, amortization of intangible expenses, share-based compensation costs and associated tax impacts, which are excluded from ANI*.

From a balance sheet perspective, WNS ended Q4 with $395.2 million in cash and investments and $16.7 million of debt. In the fourth quarter, the company generated $75.6 million in cash from operations, incurred $5.6 million in capital expenditures, and made scheduled debt payments of $8.4 million. WNS also repurchased 694,716 ADSs at an average price of $73.61 per ADS, which impacted Q4 cash by $50.9 million dollars. Fourth quarter days sales outstanding were 30 days, as compared to 31 days reported in Q4 of last year and 34 days in the previous quarter.

“In the fiscal fourth quarter, WNS delivered solid financial results, posting healthy revenue, margin and free cash flow. While our full year results were adversely impacted by the global pandemic, we are pleased with our overall execution in a very difficult environment and our business momentum exiting the fiscal year,” said Keshav Murugesh, WNS’s Chief Executive Officer. “During fiscal 2021, WNS was able to quickly adapt our delivery to a “work from home” model and maintain support for our clients’ core, mission-critical processes. In addition, the company continued to add new clients and expand existing relationships at a healthy pace, helping drive revenue growth and margin expansion as the year progressed. We believe this clearly demonstrates WNS’ differentiated positioning in the market, the strategic importance of our solutions, and the resiliency of the BPM model. We are also extremely proud of the fact that we were able to achieve these results while protecting the safety and welfare of our more than 40,000 global employees, and continuing the strategic investment programs necessary to drive long-term sustainable value for all of our key stakeholders.” COVID-19 The COVID-19 pandemic is having a significant impact on the global economy, our clients’ businesses, and on WNS’s operations, financials, and visibility. Revenue has been pressured by lower client volumes, delays in new business ramps, client concessions, and facility lockdowns which impact service delivery. WNS is actively working to manage our clients’ changing requirements, adapt our service delivery models, ensure data security, and manage costs. In the fiscal fourth quarter, the company delivered over 99% of our clients’ requirements. Going forward, impacts to our financial performance will be a function of how long the COVID-19 pandemic lasts on a global basis, and how long it takes our clients’ businesses to stabilize and recover.

Fiscal 2022 Guidance WNS is providing guidance for the fiscal year ending March 31, 2022 as follows: • Revenue less repair payments* is expected to be between $945 million and $997 million, up from $868.7 million in fiscal 2021. Fiscal 2022 guidance assumes an average GBP to USD exchange rate of 1.38 versus 1.31 in fiscal 2021.

• ANI* is expected to range between $152 million and $164 million versus $141.7 million in fiscal 2021. Fiscal 2022 guidance assumes an average USD to INR exchange rate of 74.00 versus 74.25 in fiscal 2021.

• Based on a diluted share count of 51.1 million shares, the company expects fiscal 2022 adjusted diluted earnings* per ADS to be in the range of $2.98 to $3.21 versus $2.72 in fiscal 2021.

“The company has provided our initial forecast for fiscal 2022 based on current visibility levels and exchange rates,” said Sanjay Puria, WNS’s Chief Financial Officer. “Our guidance for the full year reflects growth in revenue less repair payments* of 9% to 15%, or 7% to 13% on a constant currency* basis. We currently have 90% visibility to the midpoint of the range, consistent with April guidance in previous years. For the year, we expect capital expenditures of up to $35 million.” Conference Call WNS will host a conference call on April 22, 2021 at 8:00 am (Eastern) to discuss the company's quarterly results. To access the call in “listen-only” mode, please join live via the company’s investor relations website at ir.wns.com. For call participants, please use the following details: US dial-in +1-888-656-9018; international dial-in +1-503-343-6030; participant passcode 7880707. A replay will be available for one week following the call at +1-855-859-2056; international dial-in +1-404-537-3406; passcode 7880707, as well as on the WNS website, www.wns.com, beginning two hours after the end of the call.

About WNS WNS (Holdings) Limited (NYSE: WNS) is a leading Business Process Management (BPM) company. WNS combines deep industry knowledge with technology, analytics and process expertise to co-create innovative, digitally led transformational solutions with over 375 clients across various industries. WNS delivers an entire spectrum of BPM solutions including industry-specific offerings, customer interaction services, finance and accounting, human resources, procurement, and research and analytics to re-imagine the digital future of businesses. As of March 31, 2021, WNS had 43,997 professionals across 58 delivery centers worldwide including facilities in Australia, China, Costa Rica, India, the Philippines, Poland, Romania, South Africa, Spain, Sri Lanka, Turkey, the United Kingdom, and the United States. For more information, visit www.wns.com.

Safe Harbor Statement This release contains forward-looking statements, as defined in the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on our current expectations and assumptions about our Company and our industry. Generally, these forward-looking statements may be identified by the use of terminology such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “will,” “seek,” “should” and similar expressions. These statements include, among other things, express or implied forward-looking statements relating to our expectations regarding the impact of the COVID-19 pandemic on our business, our cost structure, the discussions of our strategic initiatives and the expected resulting benefits, our growth opportunities, industry environment, expectations concerning our future financial performance and growth potential, including our fiscal 2021 second quarter commentary, future profitability, and expected foreign currency exchange rates. Forward-looking statements inherently involve 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 worldwide economic and business conditions, including the impact of the COVID-19 pandemic on our business operations and future growth; political or economic instability in the jurisdictions where we have operations; our dependence on a limited number of clients in a limited number of industries; regulatory, legislative and judicial developments; increasing competition in the BPM industry; technological innovation; telecommunications or technology disruptions; our ability to attract and retain clients; our liability arising from fraud or unauthorized disclosure of sensitive or confidential client and customer data; negative public reaction in the US or the UK to offshore outsourcing; our ability to collect our receivables from, or bill our unbilled services to our clients; our ability to expand our business or effectively manage growth; our ability to hire and retain enough sufficiently trained employees to support our operations; the effects of our different pricing strategies or those of our competitors; our ability to successfully consummate, integrate and achieve accretive benefits from our strategic acquisitions, and to successfully grow our revenue and expand our service offerings and market share; and future regulatory actions and conditions in our operating areas. These and other factors are more fully discussed in our most recent annual report on Form 20-F and subsequent reports on Form 6-K filed with or furnished to the US Securities and Exchange Commission (SEC) which are available at www.sec.gov. We caution you not to place undue reliance on any forward-looking statements. Except as required by law, we do not undertake to update any forward-looking statements to reflect future events or circumstances.

References to “$” and “USD” refer to the United States dollars, the legal currency of the United States; references to “GBP” refer to the British pound, the legal currency of Britain; and references to “INR” refer to Indian Rupees, the legal currency of India. References to GAAP refers to International Financial Reporting Standards, as issued by the International Accounting Standards Board (IFRS).

* See “About Non-GAAP Financial Measures” and the reconciliations of the historical non-GAAP financial measures to our GAAP operating results at the end of this release.

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