Q2 2020 Earnings Call
Ladies and gentlemen.
Good day and welcome to the limited Q2 airports Wendy quarterly Investor Conference calls.
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I now hand, the conference with them up or not yet.
President and corporate Treasurer. Thank you I wonder what do you.
[laughter] Frankenstein first wanted to come to our Q2 earnings call and be able to begin suppose that business highlights in all of you Bio Baker, our chief Executive Officer, and managing that it don't follow my financial overview by our CFO will jump in but not afterwards, the operator, we'll open the page for Q, and even though management team.
Before I bet starts let me draw your attention to the fact that during this call me.
Make certain forward looking statements within the meaning of the private Securities Litigation Reform Act 1995. These statements are based on management's current expectations not associated with I'm totally to either [laughter], which me policy attitude or zones to me diplomacy didn't even though as expected.
The I'm totally decent risk factors that explain to you know de filings with its easy to does not undertake any obligation to update the forward looking statements terrific Eavenson tokens joins us after the date of finally be conference call I'm going to be okay electrons. Good would be made available on on that site well what do you have it.
Thank you all but no good evening and good morning, ladies and gentlemen.
I'm joined by my leadership team and it is a pleasure for us to speak to you.
Let me could you provide you an update on the Q2 performance.
I would view the demand environment.
Paul Good on I'm, just trying to do.
We had a good important execution on both revenue and margins considering the slow start that we had this fiscal year.
Revenues grew by 1.1 person in constant currency terms.
The midpoint of guidance reach.
For each one of our growth was 4.8 person do you have on yours in constant currency.
On the demanding vitamins.
<unk> strong suit door openings and not robust pipeline a bit different needs. The goal told me what how is this a little.
Due to the softness in spend by banking capital markets like.
And the completion of lots of digital transformation projects.
Inline with expectations consumer business grew win.
Well, what six person do you had on your on tobacco wouldn't deal wins.
And the Junior segment grew 6.3 person do you had on your in constant currency.
The global business communication grew at double digit year on year. That's why did the India piece of communications. They made voluntary impacting the world groups the communication segment.
We see or do you find somebody could what do you boots manufacturing and hands.
We see an uptick and the demand Fort Hills outside of H.B.S., Oh, what subsidiary that services you see a claims and we've had some good wins in the digital space.
Good.
Yes.
The demanding let them into remains unchanged from what I do it should last quarter.
<unk> continues to be in ordering of macro uncertainty in certain sectors.
Oh It was U.S. growth has been pretty strong why didn't you auto continues to be week.
We couldn't do you see a robust pipeline and the momentum of order book in Q2.
Has been but there's been Q1 and some of the deals that you had mentioned wouldn't be league. So you mean in Q1 had been signed in Q2.
But he is getting a for India and middle East business is going very well.
Reflected in settlement do you still we have announced like the large deals with ICICI bank.
We have delivered operating margins of 18.1 person in Q2.
Which is comparable to 18.4% in Q1.
After absorbing those incrementally better reach hike for two months and investing in bench for growth.
I loved ones, you're on you would have been done I don't mind.
Adjusting for the one thing.
The customer sentiment in Q.
Well you. This you re shopping dose trial did you do four pillars.
Business transformation more automation.
Did the diligence and trust.
Which is a neighboring to bite.
Linda Denuding.
Hi, <unk> platform.
Nobody should.
So what I'm customer needs across these four radio the flip side did you.
We have been investing on building capabilities and did you go engineering.
Cyber security and disk services.
To give you some updates on each one of these four big bets.
Our global investments in digital assets can you Didnt did it goes it because its experience and skin.
To support transformation not just not a coordinated gets made it started but also in the emerging markets. We had when do you get it done sort of Mr. Deeds in Canada, Australia E bike.
Of course, we could do wouldn't deals U.S. and you get.
In digital revenue rose, 7% quote unquote does.
I know digitally contributes just under 40% off the company's revenues.
For example in Canada, good working with the midstream energy company on the digital transformation journey to significantly enhance the working experiencing job satisfaction off its field force why substantially improving what a good productivity and effectiveness.
In Australia.
The company.
Enabling the.
Customer experience transformation goes the beat to be about Eugene.
I'm in Southeast Asia, and working with a government defense Ministry to lay the foundation.
Ongoing transformation leveraging digital supposed to do themselves.
[noise] second disclosed.
Is this first opposed to cloud adoption and building domains that big solutions with a cloud service providers us, but nothing has made good progress before gopro information, but not for many also to customers.
It really invested close studios to help customers needs.
To close at an accelerated pace it includes lift friendship.
Reflecting no for applications, Replatforming and moving to truly Jilin demos to leverage this.
<unk> cloud in a highly automated kinda industrialized approach.
Oh strengthened.
Thanks.
Since a lot offerings.
Prison. Some success is acknowledge my many industry analysts in the reports.
As an example, a group well.
You S lifestyle about any company has partnered with the pool.
Its transformation program.
The company will spun off into a separate publicly traded company.
The claim children as the strategic partner to establish a highly secure and scalable architecture Nobody's He got close to do all things.
The told it was engineering services, but if you have revamped our engineering services offering and we launched.
Those engineering next engineering NXT continues to deliver what do you said it was just by leveraging no. We do I live in solutions, because its existing processes and you age go sourced and global short delivery margins.
Historically repos engineering service, but just as you may be a then was quite focused on the <unk>.
With that you're getting mixed we are expanding I've said it was just across many more toward Dickens better we're seeing some very good protection.
As an example, you isn't based global medical device.
He does has awarded the pool multi million dollar de <unk> compliance with the Europe in mid because they could it be norms leveraging expertise.
And you're getting mixed.
And the fourth but the cyber security.
Just on building cyber defense shouldn't blood from an expanding to you what do you security, but this does demanded the expanding the back surfaces. That's connected systems cyber security of the said it was so putting grew 16.6 person do you have on you.
I know Q2.
A large as an example allowed U.S. based bank has selected the book what sort of cyber security defenses and it just shoes I didnt afraid doing videos internal and external audits lipomas design and implement a brokerage security controls besides providing incident management and support optimization.
Oh, the existing risk uncontrolled self assessment.
Process of the bank as you out of it.
The number of venture investments from people that just in this space, which are on leveraged to provide you services.
We can do to focus on like Miami.
And dry distiller business transformation in accounts that bring together.
<unk> domain and consulting capabilities and help us engaged in strategic conversations proactively.
Rich claims and that is because the stick where does it did not accounts.
As an example, a leading north American bank with whom we put strategic relationship has awarded a multiyear application development and support going but which is ideal for new service Lane cross selling into this account aimed at getting products to market fostered an improving customer experience.
I'll, let me start did you do they articulated is supported by.
And money.
I would be in platforms.
I live re skilling and localization girls the markets that we work where do we continued to be remained very focused.
We had a building a robust biplane allows dealers Brett do lead to meet our ambitions of groups.
Even in light of me with ever changing technology people that made up by many assets.
Linda These quarterly annualized attrition there does dropped from about 17.9% to 16%.
We continue to drive localization and no U.S. is just under 68% local workforce for us and we can do campus, writing deepening employee engagement and make significant investments in training and re skilling other workforce.
On automation, the well done they bought in fixed price projects has improved from 15.3% in Q1 to 16.5% in Q2.
In conclusion.
Despite the current macro environment.
We could do you do see an improving orderly growth trajectory, which is reflected in Q2 performance and Q3 guidance.
I just noted grids Justin <unk>.
Subsea food.
To give you an update on financials.
Thank you out of it. So if you all know we have come at the midpoint of guidance.
I didn't have remained stable, although we didn't both Sunday at 18.1 person.
As you know they would make changes which had been doing the also this quarter does anybody we had our E. On 18.3 person this time.
And the onetime impact we have taken in quarter do all of last year.
As it does that include that would all profit growth of 35.1 person.
And he is also do 6.7.
If you see on Fortyx. It just you know 2.7 billion no foreign exchanges.
Although the illusion deed full quarter too.
Well, it's 71 point 56, compared to 70 point 39 in quarter one.
We continue to create and convert good cash Oh PPI business.
I want all bidding guys feel 107% of our net income in quarter two.
We have decided to put quite a 3.82, 0.8% sequential growth and we'd be happy to be good question. So me.
Thank you very much.
Ladies and gentlemen, we will now begin the question and answer session.
Anyone who was just asked a question if you split Star then one on did not stone telephone.
If you wish <unk> from the question Q human stuff then do.
Participants Arctic will sit to use handsets when asking a question.
Ladies and gentlemen, we build we'd for the moment <unk>.
You asked a question. Please press Star then one.
The first question this phone line up.
Hi don't Securities. Please go ahead.
Yeah. Thanks Judy.
Oh first wanted to just I understand the decline, which means you know adult playing a this quarter.
And we didn't do you mentioned that I'm Gonna. This was basically a and they'll scoping of present. So was this and then what's your expectation then can this come back or Oh, I do see used to seeing some it balls in the spend up or did Oakland.
[noise] somewhat.
As you know Weve had a.
Quite a good success in driving digital transformation in the banking and financial services success.
Our topline happens to be a bank.
And Oh, we've been doing a lot of digital work for them given the current macro uncertainty as some of what projects go to what did they didn't did you do.
We've seen a little slowness on Uh huh.
Then you would have some of those projects in terms of the next phases of the did you do Providence I personally believe it's a more.
A matter of time when it comes not only some of these digital programs are done in a in multiple speakers and every sprint we would get done it sort of you for the next spring.
The news business I understand that has been a little bit of slowness in does but then for the claim to spend is not.
Going to be it is more the question also.
Spend restocking once we get a couple of programs. It successfully got completed and the new programs that we would expect it to get started haven't got started in that seemed plane. So both of these factors have created a softness in our topic.
Our instrument and the other part of the question was a middle was this something which but you had disappeared or just started the quarter was this a bit office supplies and if you can kind of thing to extend installs include the rest of the outlook on the move to say what because.
Are you seeing weakness across the board.
Yes, we are seeing a weakness in the b, if it say what together and as you look this we've come in them.
I didn't cities, which means that we had been this uncertainty.
You know the Guy who didn't so it does not come to US is I'm surprised but you would have been happier if.
This slowness would not have please note that would've come high at the midpoint of guidance. So that is they wouldn't be give the guidance does that age Oh, we incorporate some of these uncertainties, so I wouldn't call it to sort of price.
It is something that we anticipated doesn't it.
On a certain or the other question wasn't until two to five plants up and that has also seen a decline of about 5% Oh minuscule Q. So.
What sectors I do seem to be impact coming in or is this also looked like specific collection this quarter.
No I think you know in adults claims so almost 50% don't for adult claims.
The the B if it say segment. So I think the answer is more a but some of these claims that also seeing good to see macro impact that Oh. Please proceed.
If you notice a you know into lust for the last many quarters, we've grown double digit.
You know dumped in plain segment, a flat in higher than the company evidence and this time be growing up 7.4%. So the other planes have done, but but the softness is visible into bank infection. So this is claims.
Understood and if it can squeeze in one final question for jump in on this quarter's margin management was quite impressive in are you had to retake lower utilization and <unk> implementation, but its too you kept margins broadly stupid exists or something to do with a better pricing order.
I thought commission on what really.
Do you guys.
[noise], So I would say Oh. This was acquired in B to B B, what are you able to drive well still see my vision Oh from so some of our lines, which is which is visible into BNN, although our Oh you know some will fall marketing events are concentrated in quarter, one those did not.
Because we'll be got some upside on on a those spans the executed while on on collections. So P.D.D. were lower we've also got certain benefits on so didn't close lanes beach, we weren't able to do a genereight as the upside to my then.
On the are then had to be used is to invest on.
The on some of the bench, which we believe will be critical for that's what our growth. We had two months impact of wage hike Beach Ah also I would say he then investment in people.
And lastly, we have spoken about a big bet investments in some of those big bet investments have been made Oh do create additional capabilities on domain solution building Architecting architecture site. Those have also a sort of been invested in and that adversely impacted my.
And so and we didn't do tool, we were able to get to keep them I didn't know you know broadly Natalie.
Understood. Thanks for answering my question I was good but into the Q.
Thank you.
The next question is from the line up.
Well she country from Wedbush Securities. Please go ahead.
Hey, Thanks, I'm looking at your guidance for the next quarter is there any contribution from an acquisition. So I. He is the guidance purely organic or is there anything else beyond that and then on top of that can you talk a bit about the pluses and minuses the kind of resulted in a your margin.
Line sequentially. Thanks.
Sure so.
That is approximately Oh, we completed an acquisition of <unk> on total <unk> are they couldn't flow through in our ER revenue flow quantity. The contribution of debt is likely to be I don't point to the person.
That does factor in you know guidance.
The Oh there aspect of then we shouldn't be too I still am I didn't really three components, we had one time.
Benefit in form of other operating income of point for you in quarter, one which did not recur in quarter two.
Oh, all the investments on a bench salary increase and and big bets. We made was it was 1.1 thing so that goes along when they get do the also be my they shouldn't be what able to drive gave US a 23 to 1.2 person. So if you end up those no.
But you will see the movement from 18.4 person or why does 1% to 18.1% in quarter.
Thanks helpful. And then just last question or some of the trends that you've seen in financial services I'm. Assuming these continue beyond the close of the quarter. The question is whether they are kind of getting worse in terms of some of these kind of uncertainty related to the overhang or they're kinda remain consistent.
I'd or you continue to see continued to see delays are these accelerating getting worse any color there will be helpful. Thanks a lot.
So more should this be the last quarter for a lot of the financial services as you know some of the financial service organization. So also started doing for most like the manufactured again think organizations so for at least Q3.
I would say it would be same or a slightly more.
Works because of affordable.
I'm hopeful of an uptick once the IP budgets I've decided today would be able to do you want better picture, which Oh, the best guess would be around the end of the U.S., but normally the last couple of years, we've seen you get clarity only already.
Next year.
Understood. Thanks, a lot.
Okay.
Thank you.
The next question is from the line of Diviya Nagarajan from UBI as global asset management. Please go ahead.
Oh, Hi, Hi, Thanks for taking my question and you spoke about seal banking wins, how could you talk about you know where those things like I mean.
Existing client <unk>, gaining market share oh, he's not not the checking.
Are you getting it sounds how standpoint, it's coming from Pakistan.
[noise], so yeah I bought a reality.
Having wins one of the Vince as they mentioned is a ICICI bank in India, which is a a new play for US are we continue to win.
New claims in the U.S., so market does rent.
Pretty much in the mid do you had a bank space.
And then because if you do get to have been projects in.
Existing lines as you know what the past couple of years. We've had this significant market share gains in the B S. I say space this quarter.
Well, what will be able to say that when you would be about 31% or which was about five or 6%. Louis just a couple of years back so that has.
I mean because of my could show gets.
I know you don't really guide on margins, but yeah, even that you've had a fairly decent.
Despite the wage hikes, what kind of the can should they be looking at.
And.
I'm, assuming that you're doing that's <unk> <unk> level.
Stepping if anything the digits organic all things line up.
How much more than that but it's just that well that's it and stuff.
So the wed like I mentioned in beginning of quarter to that I looked Saturday as an organization do means growth.
And we will see many invested in those commitments, we have made on big bed.
As well as we remain committed.
Ooh some of the work we have done on a on on building. It I kept biblis teething foremost bench et cetera.
Oh that comment really mean.
And he will remain consistent with that.
So I don't want to guide for my thing for quite a bit threeq wonderful, but I do want to see that Oh, we have you managed it oh in a trajectory so far in I would I never would be that Ah Ah that yeah. You know, we we don't let go of my guidance, but we've been we've been.
Okay, they're doing with if they need to invest if it gives us a revenue growth in two quarters from putting them.
Thanks, and all the best thing.
Thank you.
The next question is from the line of both single from Phillip Capital. Please go ahead.
So what didn't exist. Thanks for taking my question.
My question do you was immediately on though.
You have seen in this quarter, so I think.
Have you seen have seen abroad fees.
You also mentioned in the opening remarks.
I would say below the industry average, but I think the students are getting better and the keyboard to go so <unk> energy and utilities.
Dragging the girls.
Oh seem to be coming.
In this quarter. So just wondering did you want the sustainability of these numbers in banking of course, as we know that.
It is declining and because.
It also seem that kind of weakness, but it doesn't seem to get as you mentioned outsiders fees you and.
Even in telecom.
Well underway on why did you see that do you see how sustainable are those numbers.
So.
No.
What do you can buy what <unk> banking has been a industry leading for us.
Last few quarters betrayed seeing some softness.
Could do to monitor the macro environment on the be emphasize space in communications.
Pretty good.
Nobody business has delivered double digit growth the numbers that you see oh for about a 2.4% in constant currency you're on your.
Yeah, you did numbers because of what is happening.
Yeah, Mike and where do we have a very large ship.
The communications segment.
I feel quite good can do feel good Rick the consumer the.
Sector.
Doesn't grid.
Including good this quarter and does similarly in energy and utilities I think we are making the right so that out of the.
Certain uncertainty that we love to watch out in terms of for projects getting or what a new projects.
Which are likely to stuff, but we have another good quarter.
No you're on your business as you see we've grown grid.
Except for that matter when the time, sometimes it takes between two projects.
I feel pretty good on.
Can you help does it make importantly, though oh, let's take a pitch PS and you know its BS we will be going for a long time I think there's no selected because essentially means that.
Well, the hps whenever denominator effect, but we as a winning bid.
In the that's took the business.
So.
If we can do you see growth in the <unk> to what degree.
Manufacturing.
Oh, you still undergoing a word or restructuring and recognition of that business I see strong pipeline. Some of the bets. We have made does that outlined that owned engineering around Oh are you won't be some of them.
Huh.
Yeah. That's another thing the auto industry Oh, yes, we are doing a lot of.
Engagements pilots with customers. So I'm quite hopeful offered to not only in that business, but I would give it a couple of quarters.
[laughter] neurology, we do see relative weakness in the silicon side of the business. We do a lot of work with a big companies that have a couple of customers where do we have had customer specific.
She was too because of acquisitions the challenges when does the individual customer the organizations, but overall, we have got a good pipeline and good sort of deal wins that technology vertical so overall.
I do believe that we'll be able to mean didn't secular growth.
And we'll have to take it one go to entertain on cutesy I feel quite good and are you know as we progress we will keep you updated.
Yes, I can just talk about.
This is a.
I think.
Uh huh.
A couple of years couple of years.
I've actually.
No. It wasn't that he can segment as I've also portion in terms of future because it's one week.
I'm, sorry, just setting this fans.
Do you also see some could that kind of.
Scenario playing out.
In fact I.
How did you say if I just want me Scott.
Oh, no store bought them do you think.
How close to what do you think the odd in terms of.
Oh, so lots of the B. It's the same question and then I relate to see me talk about consumer.
But oh, you know I think because the engagement so that they want it to Paul so have been paused. So I feel good about the top line now so you know we should.
We would we definitely a to Q3 and then if he would have a comment the early in Q4, as we see that first quarter laying out and how that might be but it's a good to be fine I'm sure. All if you went from the financial services industry. So you will have an insight on that as well consumer views.
Doing pretty well because like be able to say, we have led to our digital proposition and every part of the consumer businesses. The digitally transforming itself. So I feel good then I, let see me give a little more color to consumers.
When it gets.
So thanks, Doug Thanks.
You know I agree with you.
Isn't that he is going to the business.
In relation to.
That's very good and obviously, that's reflecting some of that seemed much then.
What do you feel good or like what are the largest markets, where we did in the U.S. for example.
Oh that you'd walkable, then because they thought it too, though the unemployment, but having said all that sort of yep and send it looks actually like to talk about helping our customers.
Looking at operating models digital supposed supports I think that's been very keep what our August .
I'm also bought.
Yeah.
Thinking there, yes, they want.
On the competition, so the topic omni channel customer experience really the focus city.
One thing that you have had another thought buffalo that all.
So I can't remember the imagination, so the customer journey mapping just becoming very very good for us So [laughter].
[laughter] convenient.
And while it was logistics.
Well, they didn't affect and all that kind of getting and it's.
And also what can do more gun companies.
I mean.
Well I mean by doctors that that consumer and in some of them I think they'll be called <unk>.
We had this quarter.
I think the technology and.
But I think back falls well all aboard.
Very good.
Great so more than I think that intact.
I called application infrastructure and security this actually that we bought a large global.
Well I don't think Oh, good very good yourself at all.
Oh, So think of you asked me a wonderful won't be minimal, but the worked off by a bit they're doing it go <unk>. They can get spent.
Some of your board in three different distribution has done.
Probably you did as the industry is going to come Commission also sometimes they'll be yet.
So you do the challenges. So for example, if you look at them.
Subsequent to the challenges over the past syndicate is very different from a local city. They did it ought to pick up a lot of diesel don't because from an online retailers.
Yeah, good old challenges that they don't started just to go into the overlap so it just.
Well the do quite well.
Right.
Great well for the consumer industries that drug retail CPG and others, So that'd be my.
Shop on the question.
Sure. Thanks.
Somebody's.
Good to see that given the mix 19 that he'd music.
No projecting long time is difficult, but accused given the mix of older claims.
Sure.
We don't see any significant headwinds.
Yes.
I would agree.
I couldn't be topics come in.
Sure. Thanks. Thanks.
Thank you.
Thank you.
The next question is from the line up so she solution from Axis capital. Please go ahead.
Yeah. Thanks for taking my question, we have gone through the restructuring in middle East and in their business over the last few quarters.
For those in that context.
Can you. Please tell me what we're supposed to this now behind water input B and what actually was at least the we some of that be that they've got good us do that.
[noise], so as I've said before you know.
We had we haven't we had market leadership in 14, getting middle east, but over time to kind of services that we would provide the did not fit well World company strategy, which is essentially as you know down to a driving digital in these markets are really rich opportunity.
These for digital.
The where the focus more on a commodity business. So we put together a new team about the yada Yada humpback, we gave some investment to the team we give them the ability to finish the projects Oh that we had already taken successfully for them to customers.
And then b with the business into.
Into the.
New ideas Elaine do have strategy.
The second thing that Ah we wanted to do is historically, we put all had a separate or what used to be called as we put in for take a separate Brandon a separate and to be too. So it was India and middle East, but as we saw that there is a much bigger opportunity.
To be able to bring the global expertise.
Into a this part of out of business and to be able to be successful over here and Oh I see a deal that you referred to.
He's a great example of indication of that strategy because as a bank so.
I've got enterprises truly adopt a what I would put under digital India.
A lot of experiences that we can bring from the global markets, which they.
May or may not be getting from there I didn't provide us. So that is made this a signed a deal with those with the committed to a bit the revenue commitment. So that we didn't go would they've got a landscape and then drives the transformation, but they want to under going bring the might have wipro from.
All of our investments across digital across cloud a gross up the Wipro ventures, or you know issue and then sort and so forth. So while it is early days and we are just a embarked on a b engagement and right now to the acid plants when people trends, where we are integrating that.
But there is a road map for transformation or that will bring value to our customer does Willis give us an opportunity to build a platform to which we can bring go services across the.
Many of the Indian banks and other customers. So that's a good.
Pilot. The example of how Ah Ah we are executing on our strategy and we think it shouldn't that customers see value.
That strategy.
So pretty interesting.
You said be biplane Q school is stronger than that and that was in Q1 any quantitative color for the same would be helpful.
Oh by the pipeline is strong that I talked about the order book was better in Q2 compared to Q1. So if you recollect in Q1, we what does it instead of price because some of the deals that we were declared as being that we needed by the end of Q4 the during Q1.
Inordinate he lives in signing those deals I think some of that was.
A reflection of the macro uncertainties, but customers were taking a little longer.
We were fortunate that to a large part of those deals got signed in Q2 and that is also reflected a into Q2 revenue guidance as some of those deals will start delivering revenues to us into <unk>.
Yes on margin for FEMSA stone commitment for investment in somewhat of a new areas and strategic initiative.
Well there have been Tom so investment.
And was there any impact of the same in this quarter also.
<unk>.
That is they are so she of it'll be you'll see that we have oh, we have.
Focus investment in this full spaces will not call note.
As a percentage of a modest in every quarter how much we have now incrementally added to it but the one one a deed appointed sell fees is is the balloon datasheet within dumb sofa of course, the bench and utilization number but if you also see the sales and support headcount or they do the.
They do then.
There was a significant addition dead and some of that is for the big bet.
That number remains it goes up and down but this quarter you will see a meaningful increases in that number.
So she.
On the very best for the rest of the or something.
Thanks.
Thank you.
The next question this underlying Sandeep Shah from C.G.S. <unk>. Please go ahead.
Yeah. Thanks for the opportunity just one clarity, but just wanted to understand within the top client is it fair to say most of that I've known says done in the world into Q2.
Do you believe that you have to lead for can feed them something up big or you still believe there is some deal a pending in terms of the I've known so in buzek enough.
So sundeep as it did come into the Alere.
This segment of customers or is a you know are difficult to predict in the last quarter of the yet so I would not has I guess right no Oh, we of course, there are indication, but though we will see how the quarter pans out right now I would say, it's still a uncertain outlook are very.
Exactly to lend at the end of what did okay. At this further do that isn't decent I've known stocked it'd be a nobody Gordon.
I didn't start some delayed since.
It's Andy this is a [laughter] I wish we could check that many of you did but Ah you know, but you can you can see that if he does impacted revenue for the quarter that the if it's certainly not the end up the quarter a them don't.
Okay, Okay, Okay and didn't just few things a if I look into the cost line item of miscellaneous expenses. So it has come down significantly from a quarterly average of 151 main equals who as Louis everybody goes. So most of these savings does that cutting or how should we look at it because youre sales and marketing.
Expenses issue is that might be caught a little even your DNA expenses that multi quarter low so hopefully model those expenses going forward.
So I think that I do it to model would be that they would go back or to do there are 100 numbers. So most of these cost savings.
Because we hope would at least not I put for example, I will come back to me sitting in for example, Pee Dee loaded because we have indeed done very well on our collections are in so didn't bardo fog alumina business in India as well as we have done very well Ono collection in certain parts took me do this business and that does it really did he now what Bruce.
We didn't put out full they being rebuilt a you know a reverse and that does given its been a beacon do you any lane.
Miscellaneous expenses was so didn't was good is that we could see coming and we have invested that as part of the the people caused bench.
Investment that we think Oh, what went right to be invested into current quarter.
Why is this cost will come.
Back to then all Lucy do a good <unk> to a cool great extent, I should say, but ER, we wouldn't be able to use the limit of.
The utilization up although the dominated and most importantly out automation, which we spoke about enough confidence to manage our margins going forward.
Okay, Okay, but it doesn't just wanted to understand how well this exactly mean the cost greater trade These lane or somebody. Meanwhile, your dialing up you want to be says just wanted to coordinate segment.
Yeah. So you don't do that these Ah Ah you know on an ongoing basis you are getting so didn't caused and when you make an assessment that so didn't caused a as as it makes sense thing you need not getting for this quarter you.
You don't know longer dig the provision for that or do you have already Wilson regarding that.
As I can show.
Okay and last thing in terms of the provision for though predicts a diverse.
Because he's willing to be a SRT business or because that business loss has also come down significantly older tones, who equally split between I'd. So it was N.B. I study.
Hi, this is booked.
I use idea Israelis or the middle East, which is part of Huggler related.
Okay. Okay. Thanks in August .
Thank you.
The next question is from the line of Ashwin Mehta from IDFC Securities. Please go ahead.
Yeah I had one question in terms of the effective tax.
Sure.
Yeah.
Right.
<unk>.
So it gives you a I should get any repeat.
Yes.
In terms of war.
And would be fun.
Randy do anyone.
I think you will be Uh huh.
We are still studying that takes a couple that's what I would say that between 20 and when do you want but then would be a good good estimate it could end point.
Okay. Okay.
Secondly, in terms of and send them a cause given the senior and subordinated current entities.
That's one cost item, which has.
Actually seen introduction or whatever.
Same thing.
This will possibly get.
Going forward.
On a these are.
Sustainable levels and working with.
Oh, yeah, so a desire from I would say from and they say name standpoint that will always be some quad bit up because some caught that reduction because they does so didn't marketing spend lead to remain lumpy you know business.
Now I would correlate that with the sales and support headcount, which is high Oh, but a lot of tech support headcount is really part of our cost of goods sold and not part of it say NIM. Because these are many of this investments I.
People, who won't be sales and the Liberty and therefore, they are classified as cost of goods sold and hence it is difficult to quote delayed the sales and support line at an aggregate.
Oh, we've done just a Esa nave number.
Okay. Okay.
So from an S and perspective.
There does end up yet.
They are expected to that.
That is.
Oh, Thank you and all the best.
Thank you.
The next question is from the line of the Fishman from is kept securities. Please go ahead.
Thanks for the Oh.
Uh huh.
Great teams focused on geography, Crazy <unk> European based of the World.
Weakness persists portable does they want to be season opening 40 person did your forward revenue.
You can help us understand Oh, what these leading to persisting weakness in these two geography, then how you expect it.
Oh near to medium term.
Second question is about to stick with the margin rich media.
You said go mucus any when Lucas segmental money, you've seen a some weakness seems like there might be used to work equally.
If you can watch some perspective, despite revealing communications I didn't even make sees some grind okay. Whatever the words, they look markets. It seems to have some weakness on margins.
Thank you.
Yeah salons to be.
First question I'm going to let me Len and I'm going to address the margin question for the segments.
So essentially in Europe .
You know primarily the uncertainty around breaks it is one area and second is the well what on the impact on you know we have a lot of.
Banking and capital American customers in Europe , So both of those into the intersection of those two.
Contributing to the weakness that you see these at all or.
Part of some of our large accounts so while we have robust to a new accounts being I didn't know what a bad but some of the drops coming from that or the resulting into a negative oh growth that you see yup.
I'll be back then because you didn't know for sometime now do you expect because we expect some of the topic phone.
Moving to becoming mode.
So do you expect let's say now Europes does not own next couple of quarters for us.
Yeah. So you don't want to based business in Europe still coming from some of the banking and financial services to customers I don't know as you know we entered into earlier question for the top because two month. We don't know you know how next year will flatten out.
So I would kind of go quarter by quarter as I said, our new deal wins is quite healthy for example would be one banking claimed in Germany, which is a mid tier customer a in the last quarter. The other wins, we've had but as you know some of these wins as Todd.
Small and didn't grow over time, but as the when we have some of the them downs into larger banking and capital market accounts that quite a significant and that reflects on.
On the numbers that you see or what are your so I would still anything to do it getting impacted to the b. If it say space I would just a you know keep watching quarter on quarter.
Millet.
Yeah, well under communication side in general we've seen a.
Strong growth in the global side of the business and as other articulated.
There was some weakness on the India's site.
The weakness somebody in decided was also from the margin perspective, and therefore that is what is impacting the overall number on the global side, we do not see any significant challenge on margins.
And on to be able to say a side because the revenue has to gases related to over Q1, we have seen certain impact some margin. So we'd have to watch this space over the next couple of quarters, how the revenue shapes up.
I don't need then we will be able to comment in terms of how the margin looks.
<unk>.
And as you know a you don't forget the global business.
The.
The employee base is quite Oh redeployment, so some of the.
Deals that we wouldn't get for example in the consumer segment a lot of the did you do resources and resources from from.
If a site deployments in the short them you see a modest impact over the medium term, we're able to really put it wasn't really like.
The the deployment bench.
Last just noticing isn't and yes, because they do we see weakness on swing U.S. stayed where it is largely Europe photos.
So a in de emphasizing the weaknesses or more in Europe than in the U.S., but Oh you know if you look at sectoral units from a sector perspective, I think it's more on the capital markets.
Understood. Thank you.
Thank you.
The next question this from the line up.
Please go ahead.
Oh good evening the questions do outbid, it's been almost put into how feels that he will join the rule.
Now a you've had some unfortunately experiences like it because acquisition not a blind bankruptcies and some fortunate thing you and your team or what able to execute good on the B, if it's I and some good acquisitions like design. It done it be due Oh. My question is what's your point of view on <unk>.
You are in on auto journey to bring the <unk> industry leading group.
Like its near Dumb you can see happening in the next two quarters, one yen or you think you know its do sometime or we and maybe some problems like a.
Swingeing that they might be.
Right away zone, so what's your point of view.
So I don't see any problem that just take quite a ways to resolve I think we clearly articulated strategy, we relentlessly executing on that strategy.
We have seen good results Oh on that strategy, whether it is on building capabilities as you rightly mentioned.
The acquired Inorganically based capabilities that make us quite futuristic.
Yes, like plane mining and a account execution you made significant investments our customer satisfaction today.
As a one of the highest you're not history.
So I feel quite good about it I think what we need to continue to do is relentlessly execute and make sure that or even in some of the macro spaces. There's always an opportunity in some of the slowdowns in some of the.
Economic cycles, and we need to just to make sure that we make the most of those opportunities.
Okay. Thanks.
Thank you.
The next question is from the line of getting <unk> from <unk>.
Please go ahead.
Yeah, I see opportunity I, just back to be a margin.
Oh, you kind of implying that.
Uh huh.
Mike because you mentioned that.
What are what they didn't get any better than what he looked back.
From a two year perspective.
I'll be like that.
Hi, Jim.
So.
You can look all from a three year the same burned out as patients or delay would be to go beyond 18 in 18 outputs. Indeed.
My comment was vis-a-vis the fact that up.
That we had a then visibility of was created a and cost benefits that we were able to execute in quarter 2 billion listed back some of those may not continue in quarter three but we have we will execute on another lever for quality also I want to what I think I'm into in my opinion that we we how do they.
Many investors.
To get the group I'm, a little bit a trajectory and was the growth comes a as as we all know them I didn't always follow so that's the order like we'll do this with the jet working with good it's a difficult to call out specific numbers or ranges.
You know beyond beyond that.
[laughter] spot mean, they see a it's a nice I know they.
Many of US no Oh, he's had a much higher 89 huh.
What exactly it it's they know that it gets actually or what exactly why are you getting that it would be more than your peers in the market.
To get each weekend, we can certainly a explained the occasional hedge accounting that we do a maybe oh, you know upper notably shake from our yard beam can can explain that.
We have remained very consistent with that hedging policy as I articulated every quarter and that's certainly has played out well for us I I'm unable to compared with the the others, but we can certainly explain the accounting methodology that we use for other segment of the books.
My last question is regarding pricing or flash gross margin.
How much more would that needed to be youre never end markets or a seed pricing or how much higher would it take though.
Maybe a nominal pricing.
Yeah. So a good each the <unk> the pricing bolt on site and offshore is is definitely higher than the traditional services. However, this city. So you'll see the also out more expensive. So right you know the Ah we get didn't.
A little bit their trajectory of off my Vince as we get into larger projects and on.
On on or more sustained revenue stream [noise].
There are also.
I would say a marketing or the capability.
<unk> digital experience kind of investments that we have done a in digital boards all would be one and some of that also reduce our profitability of our projects, but overall pricing.
So do you think you know a significantly superior in some of the projects superior in other projects.
How many squeeze one last question I think you've got your order book alternate until Oh, the last few quarters would be more the newly <unk>.
Are there any sort of give anymore, it's like making kind of wondering so.
So we don't break that out, but Oh, you know if you.
Reflect on the comment I made that there were certain deals which were the delayed Richard.
Got signed in Q2, and we are starting new projects, which is reflected in the revenue guidance that we have given that the is.
Coming to live in you those would be new bids.
Thank you very much.
Thank you.
Ladies and gentlemen, doctors to last question I now hand, the conference over to Miss up or not yet for closing comments.
Thank you also joining the call in case, we couldn't take your questions. Your time constraints. Please feel free to reach out to the Investor Relations team. Thank you and how many state.
Thank you very much.
Ladies and gentlemen on behalf of.