Earnings Call Transcript Analysis Report #
Financial Performance #
Sagility India Limited reported strong financial performance for Q4 FY25 and the full fiscal year FY25, meeting or exceeding previously stated guidance.
Revenue #
- Q4 FY25: $181.8 million (₹15,685 million), a YoY growth of 22.2% in INR terms and 17.7% in constant currency (CC).
- Payer vertical: Grew 20.8% YoY, contributing 89.7% of revenue.
- Provider vertical: Grew 36.9% YoY, contributing 10.3% of revenue.
- FY25: $658.3 million (₹55,699 million), a YoY growth of 17.2% in INR terms and 14.9% in CC.
- Organic Revenue FY25: ₹54,943 million, a 15.6% YoY growth.
- Organic Revenue Q4 FY25: ₹14,929 million, a 16.3% YoY growth (2.7% QoQ).
Adjusted EBITDA #
- Q4 FY25: $46.8 million (₹4,042 million), a YoY growth of 28.6%. Adjusted EBITDA margin was 25.8%.
- FY25: $173.6 million (₹14,685 million), a YoY growth of 28.4% in INR terms. Adjusted EBITDA margin was 26.4%.
- Adjustments to EBITDA include earnouts from acquisitions (DCI, Birch, BroadPath) and share appreciation rights expense (non-cash, settled by parent).
Adjusted Profit After Tax (PAT) #
- Q4 FY25: ₹2,398 million, a YoY increase of 45.2%.
- Adjustments to PAT include amortization of intangibles from the carve-out.
Earnings Per Share (EPS) #
- FY25 Reported EPS: ₹1.17 per share, a 119.3% increase YoY.
- FY25 Adjusted EPS: ₹1.76 per share, a 27.7% increase YoY.
Cash Flow #
- FY25 Operating Cash Flow (OCF): ₹12,141 million, “almost 90% of our reported EBITDA.”
- FY25 Free Cash Flow: ₹10,896 million, “80.5% of EBITDA.”
- The BroadPath acquisition was “fully cash funded” from operational cash.
Debt #
- Net debt plus lease liabilities: 0.68x of EBITDA as of March 31, 2025.
Guidance & Forecasts #
- The company reiterated its medium-term revenue growth guidance: “low- to mid-teens revenue growth in the medium term” on an organic, constant currency basis.
- Including BroadPath (acquired end of Jan 2025, so only 2 months in FY25 numbers), FY26 constant currency total growth is “likely to be upwards of 20%.”
- Adjusted EBITDA margin guidance: “committed to delivering a steady-state margin… around the 24% to 25%.” This is before an expected “120 to 150 bps dilution” from the BroadPath acquisition in FY26. So, effective FY26 guidance is closer to 22.5-23.8%.
Strategic Initiatives & Business Updates #
The company continues to execute on its three-pillar growth strategy and integrate recent acquisitions.
Growth Strategy #
- Anchored in “(1) deepening our wallet share with our existing clients, (2) expanding into mid-market health plans, and (3) selectively pursuing strategic acquisitions.”
BroadPath Acquisition #
- Contributed 30 new clients, primarily mid-market payers.
- “We are also very encouraged to see early signs of cross sell revenue synergy between BroadPath and the rest of the Sagility business.”
- Integration is critical: “integration of BroadPath is very critical to us because it was a sizable acquisition from a client’s and people point of view.”
- Impacts seasonality: “BroadPath, the seasonality will increase… their Q3 revenues are substantially higher.”
Client Metrics #
- 75 active clients at FY25 end.
- 38 new clients onboarded in FY25 (30 via BroadPath). Organically, 8 new clients were added.