WNS' recent progress (see WNS Q3 looking better, but challenges remain) has continued in Q4. The offshore BPO pure play grew revenue less repair payments (RLRP) 13% to $112.8m, and its adjusted net income margin (before the nasty bits) to 14% vs. 13.2% last time, and 12.3% in Q3.
In the full year, RLRP was up 10.4% to $436.1m, and the ANI margin against RLRP remained steady at 12%. Most of this was organic growth too at 8.7%, and an improvement on last year’s 6.9%.
In terms of strategy, WNS has been expanding its footprint during the year as it follows clients into new territories. For instance it added new delivery capability in the US, Poland and China and acquired Fusion in South Africa in June. WNS is clearly pleased with that purchase, since it added 12 new clients to its books.
Speaking to analysts, CE Keshav Murugesh said he sees BPO deals becoming more global, particularly in the F&A space where WNS is keen to expand, with deals being broken up into territories serviced by different vendors. What this really means is WNS is now squarely going after large multi-country deals. It will therefore be competing increasingly against larger global competition such as Genpact, Capgemini, Accenture and IBM.
The new financial year appears to have got off to a good start, with WNS winning its first large deal of the year taking over the clients’ entire F&A function. Murugesh said WNS would need 5 or 6 big deals like this to hit the top end of its FY14 revenue guidance of $460m to $480m. It achieved 4 such deals in FY13.
WNS is also seeing traction in outcome-based BPS deals, signing 3 new logos since the start of April for outcome-based fair audit services. Outcome-based BPS is a key driver for many BPS suppliers today as clients seek to minimise contracting risks and maximise the upsides from their supplier relationships. There are however different ways for suppliers to engage with clients in outcome-based BPS deals - some are more risky than others (see Outcome-based business process services – what’s it all about?).