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EARNINGS PRESENTATION Q3FY25
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Copyright © 2024 Firstsource 2 Disclaimer Certain statements in this presentation concerning our future growth prospects are forward-looking statements, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward- looking statements. The risks and uncertainties relating to these statements include, but are not limited to risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in BPS market including those factors which may affect our cost advantage, wage increases, our ability to attract and retain highly skilled professionals, time and cost overruns on client contracts, client concentration, our ability to manage ramp-ups and growth, our ability to manage our international operations, reduced demand in our key focus verticals, disruptions in telecom infrastructure and technology, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, performance of our subsidiaries, withdrawal of government fiscal incentives, political instability, legal restrictions on raising capital and acquiring companies outside India, unauthorized use of our intellectual property and general economic conditions affecting our industry. Firstsource may, from time to time, make additional written and oral forward-looking statements, including our reports to shareholders. The company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the company.
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Copyright © 2024 Firstsource 3 About Us Established in 2001 Public listing in 2007 Revenues of INR 63.4 Billion (US$765 Million) in FY2024 34,144* Firstsourcers Across US, UK, India, Philippines, South Africa, Australia, Mexico, Romania, Trinidad & Turkey 200+ global clients# including 19 Fortune 500 companies and 3 FTSE 100 companies Specialized BPS partner Hyper-focused, domain-centric teams with cutting-edge tech, data, and analytics Leaders in chosen verticals Banking & Financial Services, Healthcare, Communications, Media & Technology, Retail and Utilities Deep partnerships with clients Average tenure of top 5 clients is over 20 years Part of RP-Sanjiv Goenka Group Since 2012 #For clients with trailing 12-months revenue over US$0.25mn *As on 31st December 2024
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Copyright © 2024 Firstsource 4 Part of RP-Sanjiv Goenka Group Committed to powering millions of Indian homes and businesses with reliable electricity through its generation and distribution services A global player and a national leader with portfolio of Carbon Black & Specialty Chemicals Global leader in specialized Business Process Services leveraging hyper-focused, domain-centric teams with cutting-edge tech, data, and analytics to deliver value for over 200 clients Diversified and innovative media company, with music catalogue that spans the gamut from the first recorded Indian songs to the latest hits and a strong video play, spread across making Films, TV serials, OTT series and short video content catering to the youth Nature's Basket is India's finest gourmet retailer with international food products Spencer is an experience led multi-format retailer with varied assortments Too Yumm is a rapidly growing snack brand, captivating consumers with its flavorful and better-for- you snacking Playing in the Personal care category with brands like Naturali and Within Beauty Inspiring communities, unite fans, set new benchmarks, foster championship culture, contribute to the development & growth of sports culture globally Step into a world of unparalleled luxury. Quest, the first of its kind in Eastern India, curates premium experiences that elevate your lifestyle India’s largest producer of rubber & South India’s second largest cultivator of tea Global media organization dedicated to helping its readers succeed big in business through best-in-class storytelling One of India’s new-age and fastest growing Conglomerates Presence in 50+ countries Strong workforce of 50,000+ employees, belonging to different nationalities 100+ offices worldwide * All figures as on FY24 Group turnover of ~US$4.4 Bn* EBITDA of ~US$855 Mn* Asset base of >US$7.3 Bn* Over 1.1 Million Shareholders
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Copyright © 2024 Firstsource 5 Our Verticals Banking & Financial Services ▪ Asset Finance ▪ Credit Cards ▪ Mortgages ▪ Retail & SME Banking ▪ FinTech ▪ Hospital Providers ▪ Physician Groups ▪ Health Plans ▪ Healthcare Services ▪ Medical Devices Communications Media & Technology ▪ Streaming Services, Cable TV ▪ Broadband & Telephony ▪ Consumer Tech ▪ Ed Tech ▪ E-Commerce Healthcare Diversified Industries ▪ Utilities ▪ Government Entities ▪ Retail and e-commerce 1 of T op2 Broadcasting and media companies in the UK 2 of T op5 Telecom and broadcasting companies in the US 4 of T op15 Mortgage Servicers in the US 1,000+ Hospitals in the US 11 of T op15 Health insurance/managed care providers in the US 4 of T op5 Consumer-tech companies in the US 3 of T op6 Retail Banks in the UK 5 of T op15 Mortgage Lenders in the US 6 of T op10 Credit card issuers in the US 2 of T op4 Utility companies in the UK 2 of Top 10 Retailers in the UK
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Copyright © 2024 Firstsource 6 Our Leadership Team Sundara Sukavanam Head – Enterprise Transformation Office Ritesh Idnani MD & CEO Aftab Javed Chief Human Resources Officer Rajiv Malhotra Head – Europe, Middle East & Africa Arjun Mitra Head – Collections Ashish Chawla Head – CX and Consulting Vivek Sharma Head – CMT, BFS and Emerging Geos Venkatgiri Vandali Head – Healthcare & Lifesciences Hasit Trivedi Chief Digital & AI Officer Sohit Brahmawar Chief Operating Officer Aniket Maindarkar Chief Marketing Officer Dinesh Jain Chief Financial Officer
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Copyright © 2024 Firstsource 7 Performance Highlights | Q3FY25
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Copyright © 2024 Firstsource 8 Performance summary | Q3FY25 ₹ 21,024 Million (US$ 249 Million) REVENUE YoY growth of 31.7% YoY constant currency growth of 27.7% QoQ constant currency growth of 7.6% EBIT PROFIT AFTER TAX ₹ 2.27 per share EARNINGS PER SHARE (Diluted) ₹ 2,333 Million (Margin 11.1%) YoY growth of 36.5% YoY margin expansion of 40bps QoQ margin expansion of 30bps ₹ 1,603 Million* (Margin 7.6%) YoY growth of 24.5% YoY margin contraction of 50bps QoQ margin expansion of 40bps (*Include one-time gain of ₹ 88mn) Q2FY25 at ₹ 1.96 per share Q3FY24 at ₹ 1.84 per share ₹ ₹ ₹
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Copyright © 2024 Firstsource 9 Performance summary | 9MFY25 ₹ 58,189 Million (US$ 694 Million) REVENUE YoY growth of 24.7% YoY constant currency growth of 21.8% EBIT PROFIT AFTER TAX ₹ 6.15 per share EARNINGS PER SHARE (Diluted) ₹ 6,384 Million (Margin 11.0%) YoY growth of 24.4% YoY margin flat ₹ 4,338 Million* (Margin 7.5%) YoY growth of 13.8% YoY margin contraction of 70bps (*Include one-time gain of ₹ 88mn) 9MFY24 at ₹ 5.43 per share TTM at ₹ 8.05 per share ₹ ₹ ₹
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Copyright © 2024 Firstsource 10 Key Deal Wins | Q3FY25 • One of the Top10 healthcare payer in North America, an existing client, selected us for claims processing services • Awarded a deal by a leading dental benefits administrator in the US for improving claims and customer experience • Selected by a leading insurance provider, a new logo, in Australia for customer experience services • One of the Top3 consumer tech companies in North America selected us for providing GenAI services • Expanded relationship with one of the largest utilities companies in the UK, an existing client, with additional business for CX services • Secured a new deal with a leading verification services provider for the US mortgage industry for customer support services • Won deal from a large AI lending platform in the US, a new logo, for collection services
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Copyright © 2024 Firstsource 11 Total headcount Attrition* *For employees in employment for more than 180 days • Total headcount of 34,144 employees • QoQ net headcount addition of 1,246 • TTM employee attrition at 31.4% • 46.3% of employees are women 25,947 27,940 29,231 32,898 34,144 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 37.7% 35.4% 31.8% 30.6% 31.4% Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Employee Base | Q3FY25
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Copyright © 2024 Firstsource 12 Awards & Recognitions | Q3FY25 Score Breakdown Industry leading score on: • Privacy Protection • Risk & Crisis Management • Business Ethics • Cybersecurity & System Availability/Information Security Scored high on: • Human Capital Management • Climate Strategy Read our FY24 ESG report Firstsource ranked in the top 99th percentile on the Dow Jones Sustainability Index 2024 Firstsource was recognized in Avasant’s 2024 RadarView one of the top 5 leaders from 15 top- tier providers offering mortgage business process transformation services Times Now, a part of India's renowned Times Group, recognized Ritesh Idnani, MD & CEO, Firstsource, as India's Impactful CEOs for 2024 Firstsource Named a Leader in Mortgage Business Process Transformation Driving transformation and innovation in mortgage services S&P Global Sustainable1 ESG and CSA Score of 81 each
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Copyright © 2024 Firstsource 13 Business Outlook | FY25 21.8-22.3% constant currency revenue growth (Earlier: 19.5-20.5%) 11-11.5% EBIT margin (Earlier: 11-11.5%)
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Copyright © 2024 Firstsource 14 Factsheet
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Copyright © 2024 Firstsource 15 In ₹ million Q2FY24 Q3FY24 Q4FY24 FY24 Q1FY25 Q2FY25 Q3FY25 QoQ YoY Income from services 15,417 15,948 16,693 63,325 17,839 19,326 20,879 8.0% 30.9% Other operating income (17) 18 12 37 72 (72) 145 - - Revenue from operations 15,400 15,966 16,705 63,362 17,911 19,254 21,024 9.2% 31.7% Revenue from operations (USD Mn) $ 186 $ 192 $ 201 $ 765 $ 215 $230 $249 8.4% 29.9% QoQ Growth % - constant currency (0.1%) 3.4% 4.2% - 6.5% 6.9% 7.6% - - YoY Growth % - constant currency (1.9%) 2.8% 4.5% 1.1% 14.8% 22.7% 27.7% - - Manpower expenses 9,402 9,895 10,558 39,093 11,268 12,104 13.070 8.0% 32.1% Operating expenses 3,710 3,700 3,643 14,705 3,944 4,277* 4,777 11.7% 29.1% EBITDA 2,288 2,371 2,503 9,564 2,699 2,873 3,177 10.6% 34.0% EBITDA margin 14.9% 14.9% 15.0% 15.1% 15.1% 14.9% 15.1% 20bp 20bp Depreciation & amortization 654 663 673 2,602 729 792 844 6.6% 27.4% EBIT 1,634* 1,709 1,830 6,962 1,970 2,081* 2,333 12.1% 36.5% EBIT margin 10.6% 10.7% 11.0% 11.0% 11.0% 10.8% 11.1% 30bp 40bp Other income / (expense) 153# 134# 3 296 (11) (40) (39) - - Interest expense, net (244) (235) (240) (962) (287) (330) (375) 13.6% 59.6% Exceptional items - - - - - - 88 - - Profit before taxes 1,543 1,608 1,593 6,296 1,673 1,710 2,007 17.3% 24.8% Taxes and minority interest 278 321 258 1,150 320 328 404 23.0% 25.9% Profit after tax 1,265 1,287 1,335 5,147 1,353 1,382 1,603 16.0% 24.5% Net margin 8.2% 8.1% 8.0% 8.1% 7.6% 7.2% 7.6% 40bp -50bp Diluted EPS (₹/share) 1.80 1.84 1.90 7.34 1.92 1.96 2.27 15.8% 23.4% #including other income on account of changes in the fair value of the liabilities for purchase of non-controlling interest and contingent considerations *include one-time charges Cons. IndAS financials | Profit & Loss Statement
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Copyright © 2024 Firstsource 16 Cons. IndAS financials | Balance Sheet In ₹ million As on 31-Mar-24 As on 31-Dec-24 Equity and liabilities Shareholder's Funds Equity share capital 6,970 6,970 Reserve and surplus 30,034 35,358 Non-controlling interest 4 4 Total Equity 37,008 42,332 Non-current liabilities Financial liabilities Long-term borrowings 42 3,485 Lease liabilities 5,714 6,439 Other financial liabilities - 570 Provisions 188 275 Deferred tax liabilities 1,470 1,599 Total non-current liabilities 7,414 12,368 Current liabilities Financial Liabilities Short-term and other borrowings 8,081 9,217 Trade payables 3,056 3,619 Lease liabilities 1,496 2,099 Other financial liabilities 2,047 3,823 Other current liabilities 1,057 1,313 Provisions 467 614 Provision for tax (net) 205 340 Total current liabilities 16,409 21,026 Total liabilities 60,830 75,726 In ₹ million As on 31-Mar-24 As on 31-Dec-24 Assets Non-current assets Fixed assets 2,461 4,013 Right-of-use assets 6,355 7,325 Goodwill on consolidation 29,885 36,749 Investment in associates 0 0 Financial assets Investments 115 115 Other financial assets 825 1,129 Deferred tax assets 2,921 2,773 Income tax assets (net) 809 859 Other non-current assets 2,086 2,129 Total non-current assets 45,457 55,093 Current assets Financial assets Current investments 300 774 Trade receivables 11,608 15,476 Cash and cash equivalents 1,748 1,710 Other balances with bank 137 71 Other financial assets 94 81 Other current assets 1,486 2,521 Total current assets 15,374 20,633 Total assets 60,830 75,726
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Copyright © 2024 Firstsource 17 In ₹ million 9 Month ended Dec 31, 2023 9 Month ended Dec 31, 2024 Cash flow from operating activities Net profit before taxation and non controlling interest 4,704 5,389 Depreciation and amortization 1,929 2,364 Finance costs (for borrowing & lease liabilities) 769 1,053 Adjustment: Non-cash expense / (other income) (441) 494 Add: Working capital changes (1,853) (3,475) Less: Income taxes paid (495) (889) Net cash generated from / (used in) operating activities (A) 4,612 4,936 Cash flow from investing activities Capital expenditure, net (571) (1,572) Interest income received 2 11 (Increase)/decrease in current investments 116 (338) Acquisition of business - (5,018) Earmarked balances with banks 7 69 Net cash generated from / (used in) investing activities (B) (446) (6,849) Cash Flow from financing activities Net change in borrowings (1,316) 4,579 Net interest paid (799) (1,173) Payment of lease liabilities (1,029) (1,175) Purchase of treasury shares, net 65 (150) Purchase of non controlling interest in subsidiary (583) (225) Net cash generated from / (used in) financing activities (C) (3,661) 1,857 Net increase/ (decrease) in cash and cash equivalents (A+B+C) 505 (56) Cash and cash equivalents at the beginning of the period 1,515 1,748 Foreign exchange (loss) / gain on translating cash and cash equivalents 12 18 Closing cash and cash equivalents 2,032 1,710 Current investments 491 774 Short term fixed deposits 33 36 Cash and cash equivalents including investments 2,556 2,520 Cons. IndAS financials | Cash Flow Statement
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Copyright © 2024 Firstsource 18 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Revenue by Vertical Banking & Financial Services 41.8% 40.3% 40.8% 40.8% 38.3% 37.3% 36.4% 34.4% 32.4% Healthcare 34.2% 33.2% 32.6% 32.7% 33.5% 32.9% 35.7% 36.3% 34.0% Communications, Media & Tech 21.6% 22.3% 21.8% 21.2% 22.5% 23.6% 22.3% 21.3% 20.3% Diverse Industries 2.4% 4.2% 4.8% 5.3% 5.7% 6.2% 5.6% 8.0% 13.3% Revenue by Geography North America 64.9% 63.3% 63.5% 65.1% 65.4% 65.0% 68.2% 68.5% 66.3% Europe, Middle East, and Africa 34.1% 36.3% 36.4% 34.8% 34.5% 34.9% 31.8% 31.4% 33.6% Rest of World 1.0% 0.4% 0.1% 0.1% 0.1% 0.1% 0.0% 0.1% 0.1% Revenue by Delivery Offshore & Nearshore 25.1% 24.6% 25.6% 26.7% 30.3% 31.4% 35.0% 35.8% 40.1% Onshore 74.9% 75.4% 74.4% 73.3% 69.7% 68.6% 65.0% 64.2% 59.9% New Logos# New logos added (during the quarter) 12 9 10 12 10 9 10 13 13 Client Concentration Top 5 clients (share of total revenues) 38.5% 37.4% 37.2% 35.0% 35.8% 36.7% 34.6% 32.5% 29.2% Top 10 clients (share of total revenues) 53.6% 53.6% 52.7% 51.3% 52.0% 52.6% 51.5% 48.6% 43.5% Client Distribution# US$ 1m+ clients (nos.) 100 99 98 101 104 103 100 105 107 US$ 5m+ clients (nos.) 29 28 24 24 25 25 25 26 28 US$ 10m+ clients (nos.) 15 11 14 13 13 13 13 13 14 US$ 20m+ clients (nos.) 7 7 9 8 8 8 9 11 10 US$ 50m+ clients (nos.) 1 2 2 2 2 2 2 2 2 Revenue by Currency USD 63.3% 62.2% 63.2% 65.0% 64.9% 64.8% 67.9% 68.2% 64.9% GBP 35.5% 37.0% 36.3% 34.3% 34.4% 34.4% 31.4% 30.9% 34.2% Others 1.1% 0.9% 0.5% 0.7% 0.7% 0.8% 0.7% 0.9% 0.9% Employee Metrices Total employees (period-end) 23,627 23,018 22,384 23,953 25,947 27,940 29,231 32,898 34,144 Net addition (305) (609) (634) 1,569 1,994 1,993 1,291 3,667 1,246 Attrition* (TTM) 45.8% 43.5% 41.7% 39.8% 37.7% 35.4% 31.8% 30.6% 31.4% * For employees in employment for more than 180 days | # Excludes Ascensos Operating Metrices | Q3FY25
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Copyright © 2024 Firstsource 19 Annexure
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Copyright © 2024 Firstsource 20 Financial performance snapshot | 9MFY25 Revenue Revenue (in ₹ million) (in $ million) EBIT and Margin (%) PAT and Margin (%) 3,778 3,397 3,617 5,374 5,137 5,147 4,338 9.9% 8.3% 7.1% 9.1% 8.5% 8.1% 7.5% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 FY19 FY20 FY21 FY22 FY23 FY24 9MFY25 PAT PAT Margin (%) 2.0% 1.1% 548 578 685 795 750 765 694 FY19 FY20 FY21 FY22 FY23 FY24 9MFY25 YoY constant currency revenue growth YoY US$ revenue growth (in ₹ million) (in ₹ million) 6.6% 5.6% 17.9% 18.5% 14.6% 16.0% -1.1% -5.7% 7.1% 23.9% 16.6% 1.7% 5.2.% 38,263 40,986 50,780 59,212 60,223 63,362 58,189 FY19 FY20 FY21 FY22 FY23 FY24 9MFY25 4,610 4,437 5,979 7,105 5,633 6,962 6,384 12.0% 10.8% 11.8% 12.0% 9.4% 11.0% 11.0% 0.0 % 2.0 % 4.0 % 6.0 % 8.0 % 10. 0% 12. 0% 14. 0% - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 FY19 FY20 FY21 FY22 FY23 FY24 9MFY25 EBIT EBIT Margin (%) YoY INR revenue growth Note: 9MFY25 EBIT margin was 11.1%, adjusted for one-time charges related to acquisitions in Q2FY25 23.0% 21.8% 24.7% Note: 9MFY25 PAT includes one-time gain of ₹ 88mn in Q3FY25
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Copyright © 2024 Firstsource 21 187 92 1,678 3,147 2,999 1,451 3,743 5,390 8,341 4,367 6,950 5,271 6,673 8,959 Key performance indicators | 9MFY25 4,000 4,104 8,921 7,870 7,634 6,448 4,936 2,913 3,156 7,225 7,141 7,119 5,597 3,364 FY19 FY20 FY21 FY22 FY23 FY24 9MFY25 13.9% 12.3% 12.9% 17.7% 15.3% 13.9% 13.7% FY19 FY20 FY21 FY22 FY23 FY24 9MFY25* 14.1% 12.3% 17.6% 17.6% 13.4% 15.4% 15.5% FY19 FY20 FY21 FY22 FY23 FY24 9MFY25* Long term Debt including current maturities Short term Debt Net DebtOperating Cash Flow Free Cash Flow (in ₹ million) (in ₹ million) Return on Equity (%) Return on Capital Employed (%) Cash Flow Debt Position FY20 FY21 FY22 FY23 FY24FY19 9MFY25 *Annualised 3,885 6,526 3,846 8,013 6,159 6,042 10,182
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Copyright © 2024 Firstsource 22 Total Shareholder Return | Trailing 5 years Total Shareholders Return (including dividends) of ~8x in past 5 years Based on closing prices as of 6th February 2025 FSL, 728% NIFTY IT, 161% Feb-20 Aug-20 Feb-21 Aug-21 Feb-22 Aug-22 Feb-23 Aug-23 Feb-24 Aug-24 Feb-25
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Copyright © 2024 Firstsource THANK YOU Investor relations Investor relations