Newgen Software Reports Revenues of Rs 661 Cr in FY’20, Cloud Revenues up 60%
Company helps enterprise customers adapt to the uncertain environment with its low code digital automation platform.
Speaking about the results, Mr. Diwakar Nigam, Chairman & Managing Director, Newgen Software Technologies Ltd. said – “An uncertain environment calls for extraordinary steps by an organization. During the COVID-19 pandemic, Newgen’s pre-emptive measures, business continuity processes and robust IT infrastructure ensured quick control and seamless transition to the remote working environment. Our solutions, developed on our low code digital automation platform, are of mission-critical nature for our long term customers. They serve as the backbone of their operations. During this COVID-19 time, we ensured their continued operations and business continuity. The Company focused on the health and safety of employees while fully supporting clients worldwide. I would like to take this opportunity to thank all our employees for showing such dedication towards work.
Our business has heavy dependence on the fourth quarter. However, fourth-quarter performance was lower than expected impacted by new business deferments due to restrictions imposed globally starting in February 2020 and the subsequent evacuation operations; as well as continuing economic and banking sector slowdown in India market.
While in the short term the environmental challenges are expected to continue to lead to delay in new deals signings, we believe that today, the relevance and requirement of our digital solutions for enterprises is more than ever. We are thus transforming ways of working by aggressively pursuing cloud deployments across the globe.
We believe that our annuity revenue streams from existing customers would help maintain stability in revenues. Our concerted efforts towards more efficient operations and cost optimization for cash preservation would help us maintain a healthy liquidity position during this phase.”
Key Consolidated Financial Highlights (FY’20) – [Y-o-Y Comparison]
- Revenue from operations (Consolidated) up 6.5% YoY at Rs 660.8 crores as compared to Rs 620.6 crores in FY’19. The business has heavy dependence on the fourth quarter impacting the overall performance. During the year, Newgen witnessed growth across the board in its key geographies. India, however, continued to face challenges on account of economic sluggishness in NBFC and Banking as well as banking consolidation.
- Annuity Revenue streams (ATS/AMC, Support and Cloud/SaaS) were at Rs 368.6 crores. Cloud/SaaS deployments are rapidly increasing in all geographies – US, APAC, India, as well as in the EMEA region. Cloud Revenues were Rs 38.3 crores and witnessed a growth of 60% YoY.
- Revenue from Sale of Products/ License were at Rs 117.7 crores
- Implementation & Digitization revenues were at Rs 174.5 crores
- Profit after tax down at Rs 72.7 crores on account of slower growth in top-line and continued investments in R&D & Sales and Marketing efforts.
- Prestigious customer wins: 21 new customer additions in Q4 FY’20 including:
- Large project with a leading Pan-African financial institution, offering banking services to more than 18 million customers, across 1,000 business offices and customer touch points in 20 African countries
- License Agreement with a key government ministry in India
- 4 cloud agreements in the US including a deal with a leading provider of property casualty insurance for auto, home and business
- Mid-sized project with one of the largest Bahamian banks with $1.7 billion in assets
- R&D Efforts:
- Received Patent for Mark Detection System and Methodology from US Patent Office
- Secured Patent for a System and Method for Automatic Quality Assessment of Digital Documents
- Product Launches: Company’s new version of the product iBPS has low code capabilities and cloud deployments which are very relevant today. Newgen also launched an enhanced version of Customer Communication Management product suite that enables users to easily create, design, and manage HTML email communications.
- Strategizing new offerings: Newgen is developing and deploying new solutions under the Paycheck Protection Program to help financial institutions quickly process and forgive loans under the various monetary and fiscal interventions introduced by governments globally to to stabilize economic conditions. The Company is prioritizing SaaS based delivery models with all geographies increasingly moving in that direction.
- Received approval for setting up a unit in the IT/ITES SEZ in Noida, Uttar Pradesh from Development Commissioner of Noida Special Economic Zone