Genpact Reports Full Year and Fourth Quarter 2019 Results

|Feb 6|magazine65 min read

NEW YORK, Feb. 6, 2020 /PRNewswire/ -- Genpact Limited (NYSE: G), a global professional services firm focused on delivering digital transformation, today announced financial results for the fourth quarter and full year ended December 31, 2019.

"Outstanding execution and continued Transformation Services wins capped off one of our best revenue growth years ever. This translated into healthy adjusted diluted EPS and operating cash flow growth for 2019.  These metrics were all above the high end of our expectations," said "Tiger" Tyagarajan, Genpact's president and CEO. "Clients' desire for transformational change is accelerating, expanding our addressable market and providing greater opportunities for us to drive profitable long-term growth. We continue to improve the rigor and agility of our portfolio evaluation process, allowing us to quickly reallocate investment and talent resources to best penetrate high growth areas."

Key Financial Results – Full Year 2019

  • Total revenue was $3.52 billion, up 17% year-over-year (18% on a constant currency basis).1
  • Net income attributable to Genpact Limited shareholders was $305 million, up 8% year-over-year, with a corresponding margin of 8.7%. 
  • Income from operations was $429 million, up 23% year-over-year, with a corresponding margin of 12.2%.   Adjusted income from operations was $559 million, up 18% year-over-year, with a corresponding margin of 15.9%.3
  • Diluted earnings per share was $1.56, up 8% year-over-year, and adjusted diluted earnings per share2 was $2.05, up 14% year-over-year. 
  • New bookings were approximately $3.9 billion, consistent with 2018.4
  • Cash generated from operations was $428 million, compared to $340 million in 2018.

Key Financial Results – Fourth Quarter 2019

  • Total revenue was $941 million, up 13% year-over-year both on an as reported and constant currency basis.1
  • Net income attributable to Genpact Limited shareholders was $82 million, up 4% year-over-year, with a corresponding margin of 8.7%.  
  • Income from operations was $120 million, up 8% year-over-year, with a corresponding margin of 12.7%.  Adjusted income from operations was $159 million, up 12% year-over-year, with a corresponding margin of 16.9%.3
  • Diluted earnings per share was $0.42, up 2% year-over-year, and adjusted diluted earnings per share2 was $0.57, up 10% year-over-year.

Revenue Details – Full Year 2019

Total Company

  • Total BPO revenue was $2.97 billion, up 19% year-over-year, representing 84% of total revenue.
  • Total IT revenue was $546 million, up 10% year-over-year, representing 16% of total revenue.

Global Clients

  • Revenue from Global Clients was $3.04 billion,5 up 11% year-over-year (12% on a constant currency basis),1 representing 86% of total revenue.
  • Global Client BPO revenue was $2.64 billion, up 13% year-over-year (14% on a constant currency basis).1
  • Global Client IT revenue was $400 million, up 3% year-over-year.

GE

  • Revenue from GE was $478 million5, up 78% year-over-year, representing 14% of total revenue.
  • GE BPO revenue was $332 million, up 110% year-over-year.
  • GE IT revenue was $146 million, up 32% year-over-year.

Revenue Details – Fourth Quarter 2019

Total Company

  • Total BPO revenue was $801 million, up 14% year-over-year, representing 85% of total revenue.
  • Total IT revenue was $140 million, up 3% year-over-year, representing 15% of total revenue.

Global Clients

  • Revenue from Global Clients was $811 million5, up 7% year-over-year (8% on a constant currency basis),1 representing 86% of total revenue.
  • Global Client BPO revenue was $711 million, up 9% year-over-year (10% on a constant currency basis).1
  • Global Client IT revenue was $100 million, down 4% year-over-year.

GE

  • Revenue from GE was $129 million5, up 61% year-over-year, representing 14% of total revenue.
  • GE BPO revenue was $90 million, up 81% year-over-year.
  • GE IT revenue was $40 million, up 29% year-over-year.

2020 Outlook

Genpact expects:

  • Total revenue for the full year of $3.89 to $3.95 billion, up 10.5% to 12.5% both on an as reported and constant currency basis.1   
  • Global Client revenue growth in the range of 12% to 14% both on an as reported and constant currency basis.1
  • Adjusted income from operations margin6 of approximately 16.0%.
  • Adjusted diluted EPS7 of $2.24 to $2.28.         

Conference Call to Discuss Financial Results

Genpact's management will host an hour-long conference call beginning at 4:30 p.m. ET on February 6, 2020 to discuss the company's performance for the fourth quarter and full year ended December 31, 2019. To participate, callers can dial +1 (877) 654-0173 from within the U.S. or +1 (281) 973-6289 from any other country. Callers will be prompted to enter the conference ID, 7297984.

A live webcast of the call will also be made available on the Genpact Investor Relations website at https://www.genpact.com/investors. For those who cannot join the call live, a replay will be archived on the Genpact website after the end of the call. A transcript of the call will also be made available on the website.

About Genpact

Genpact (NYSE: G) is a global professional services firm that makes business transformation real. We drive digital-led innovation and digitally-enabled intelligent operations for our clients, guided by our experience running thousands of processes primarily for Global Fortune 500 companies. We think with design, dream in digital, and solve problems with data and analytics.  Combining our expertise in end-to-end operations and our AI-based platform, Genpact Cora, we focus on the details – all 90,000+ of us. From New York to New Delhi and more than 30 countries in between, we connect every dot, reimagine every process, and reinvent companies' ways of working. We know that reimagining each step from start to finish creates better business outcomes. Whatever it is, we'll be there with you – accelerating digital transformation to create bold, lasting results – because transformation happens here.

Safe Harbor

This press release contains certain statements concerning our future growth prospects and financial results and other forward-looking statements, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those in such forward-looking statements. These risks, uncertainties, and other factors include but are not limited to a slowdown in the economies and sectors in which our clients operate, a slowdown in the business process outsourcing or information technology services sectors, our ability to develop and successfully execute our business strategies, the risks and uncertainties arising from our past and future acquisitions, our ability to convert bookings to revenues, our ability to manage growth, factors which may impact our cost advantage, wage increases, changes in tax rates and tax legislation and other laws and regulations, our ability to attract and retain skilled professionals, risks and uncertainties regarding fluctuations in our earnings, foreign currency fluctuations, general economic conditions affecting our industry, political, economic or business conditions in countries in which we operate, including the uncertainty relating to the withdrawal of the United Kingdom from the European Union, commonly known as Brexit, as well as other risks detailed in our reports filed with the U.S. Securities and Exchange Commission, including Genpact's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. These filings are available at www.sec.gov. Genpact may from time to time make additional written and oral forward-looking statements, including statements contained in our filings with the Securities and Exchange Commission and our reports to shareholders. Although Genpact believes that these forward-looking statements are based on reasonable assumptions, you are cautioned not to put undue reliance on these forward-looking statements, which reflect management's current analysis of future events and should not be relied upon as representing management's expectations or beliefs as of any date subsequent to the time they are made. Genpact undertakes no obligation to update any forward-looking statements that may be made from time to time by or on behalf of Genpact.

Contacts

Investors


Roger Sachs, CFA



+1 (203) 808-6725



[email protected]



Media


Michael Schneider

+1 (217) 260-5041

[email protected]

 

 

 

GENPACT LIMITED AND ITS SUBSIDIARIES

Consolidated Balance Sheets

(Unaudited)

(In thousands, except per share data and share count)




As of December 31,



As of December 31,




2018



2019


Assets









Current assets









Cash and cash equivalents


$

368,396



$

467,096


Accounts receivable, net



774,184




914,255


Prepaid expenses and other current assets



212,477




170,325


Total current assets


$

1,355,057



$

1,551,676


Property, plant and equipment, net



212,715




254,035


Operating lease right-of-use assets





330,854


Deferred tax assets



74,566




89,715


Investment in equity affiliates


836




Intangible assets, net



177,087




230,861


Goodwill



1,393,832




1,574,466


Contract cost assets



160,193




205,498


Other assets



155,159




217,079


Total assets


$

3,529,445



$

4,454,184


Liabilities and equity









Current liabilities









Short-term borrowings



295,000




70,000


Current portion of long-term debt



33,483




33,509


Accounts payable



42,584




21,981


Income taxes payable



33,895




43,186


Accrued expenses and other current liabilities



571,350




683,871


Operating leases liability





57,664


Total current liabilities


$

976,312



$

910,211


Long-term debt, less current portion



975,645




1,339,796


Operating leases liability





302,100


Deferred tax liabilities



8,080




3,990


Other liabilities



165,226




208,916


Total liabilities


$

2,125,263



$

2,765,013


Shareholders' equity









Preferred shares, $0.01 par value, 250,000,000 authorized, none issued







Common shares, $0.01 par value, 500,000,000 authorized, 189,346,101 and
190,118,181 issued and outstanding as of December 31, 2018 and
December 31, 2019, respectively



1,888




1,896


Additional paid-in capital



1,471,301




1,570,575


Retained earnings



438,453




648,656


Accumulated other comprehensive income (loss)


(507,460)



(531,956)


Total equity


$

1,404,182



$

1,689,171


Total liabilities and equity


$

3,529,445



$

4,454,184


 

 

GENPACT LIMITED AND ITS SUBSIDIARIES

Consolidated Statements of Income

(Unaudited)

(In thousands, except per share data and share count)




Three months ended December 31,




20178



2018



2019


Net revenues


$

734,413



$

835,339



$

940,739


Cost of revenue



454,803




533,134




630,648


Gross profit


$

279,610



$

302,205



$

310,091


Operating expenses:













Selling, general and administrative expenses



188,817




178,580




212,650


Amortization of acquired intangible assets



10,632




9,716




9,047


Other operating (income) expense, net



6,856




3,068




(31,124)


Income from operations


$

73,305



$

110,841



$

119,518


Foreign exchange gains (losses), net



(49)




186




4,083


Interest income (expense), net



(7,668)




(9,473)




(9,971)


Other income (expense), net



15,971




5,078




719


Income before equity-method investment activity, net and income tax expense


$

81,559



$

106,632



$

114,349


Equity-method investment activity, net



24




10





Income before income tax expense


$

81,583



$

106,642



$

114,349


Income tax expense



15,445




27,495




32,151


Net income


$

66,138



$

79,147



$

82,198


Net loss attributable to redeemable non-controlling interest



944








Net income attributable to Genpact Limited shareholders


$

67,082



$

79,147



$

82,198


Net income available to Genpact Limited common shareholders


$

67,082



$

79,147



$

82,198


Earnings per common share attributable to Genpact Limited
common shareholders













Basic


$

0.35



$

0.42



$

0.43


Diluted


$

0.34



$

0.41



$

0.42


Weighted average number of common shares used in computing
earnings per common share attributable to Genpact Limited
common shareholders













Basic



192,795,534




189,724,744




190,083,647


Diluted



196,862,168




193,149,836




196,592,325


 

 

GENPACT LIMITED AND ITS SUBSIDIARIES

Consolidated Statements of Income

(Unaudited)

(In thousands, except per share data and share count)




Three months ended December 31,




20179



2018



2019


Net revenues


$

2,736,929



$

3,000,790



$

3,520,543


Cost of revenue



1,681,438




1,921,768




2,294,688


Gross profit


$

1,055,491



$

1,079,022



$

1,225,855


Operating expenses:













Selling, general and administrative expenses



689,461




693,865




794,901


Amortization of acquired intangible assets



36,412




38,850




32,612


Other operating (income) expense, net



(1,661)




(1,845)




(31,034)


Income from operations


$

331,279



$

348,152



$

429,376


Foreign exchange gains (losses), net



1,996




15,239




7,729


Interest income (expense), net



(31,735)




(37,119)




(43,458)


Other income (expense), net



23,586




35,761




5,786


Income before equity-method investment activity, net and income tax expense


$

325,126



$

362,033



$

399,433


Equity-method investment activity, net



(4,543)




(12)




(16)


Income before income tax expense


$

320,583



$

362,021



$

399,417


Income tax expense



59,742




80,763




94,536


Net income


$

260,841



$

281,258



$

304,881


Net loss attributable to redeemable non-controlling interest



2,270




761





Net income attributable to Genpact Limited shareholders


$

263,111



$

282,019



$

304,881


Net income available to Genpact Limited common shareholders


$

263,111



$

282,019



$

304,881


Earnings per common share attributable to Genpact Limited
common shareholders













Basic


$

1.36



$

1.48



$

1.60


Diluted


$

1.34



$

1.45



$

1.56


Weighted average number of common shares used in computing
earnings per common share attributable to Genpact Limited
common shareholders













Basic



193,864,755




190,674,740




190,074,475


Diluted



197,049,552




193,980,038




195,160,855


 

 

GENPACT LIMITED AND ITS SUBSIDIARIES

Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)




Year ended December 31,




2017



2018



2019


Operating activities













Net income attributable to Genpact Limited shareholders


$

263,111



$

282,019



$

304,881


Net (loss) attributable to redeemable non-controlling interest



(2,270)




(761)





Net income


$

260,841



$

281,258



$

304,881


Adjustments to reconcile net income to net cash provided by operating activities:













Depreciation and amortization



58,503




64,868




96,101


Amortization of debt issuance costs (including loss on extinguishment of debt)



1,884




3,975




1,779


Amortization of acquired intangible assets



36,412




38,850




32,612


Write-down of intangible assets and property, plant and equipment



9,311




4,265




3,511


Reserve for doubtful receivables



9,819




1,857




7,443


Unrealized loss (gain) on revaluation of foreign currency asset/liability



(11,830)




3,352




(5,171)


Equity-method investment activity, net



4,543




12




16


Stock-based compensation expense



35,685




48,998




83,885


Deferred tax expense (benefit)



(10,391)




6,054




(16,315)


Loss (gain) on divestiture



5,668








Gain on exchange of non-monetary asset



(4,100)







(31,380)


Others, net



(685)




1,317




(2,229)


Change in operating assets and liabilities:













Increase in accounts receivable



(57,267)




(76,894)




(121,983)


Increase in prepaid expenses, other current assets, contract cost assets,
operating lease right-of-use assets and other assets



(28,381)




(76,392)




(69,813)


Increase (decrease) in accounts payable



(2,155)




26,401




(21,375)


Increase in accrued expenses, other current liabilities, operating lease
liabilities and other liabilities



46,581




5,993




157,580


Increase (decrease) in income taxes payable



4,640




5,597




8,346


Net cash provided by operating activities


$

359,078



$

339,511



$

427,888















Investing activities













Purchase of property, plant and equipment



(57,231)




(84,978)




(74,927)


Payment for internally generated intangible assets (including intangibles
under development)



(16,441)




(75,439)




(33,834)


Proceeds from sale of property, plant and equipment



1,738




668




1,750


Investment in equity affiliates



(496)








Proceeds from sale of equity affiliates









2,168


Payment for business acquisitions, net of cash acquired



(284,822)




(111,571)




(252,276)


Proceeds from divestiture of business, net of cash divested



(4,738)








Payment for purchase of redeemable non-controlling interest






(4,730)





Net cash used for investing activities


$

(361,990)



$

(276,050)



$

(357,119)


Financing activities













Repayment of capital/finance lease obligations



(2,708)




(2,395)




(7,380)


Payment of debt issuance costs



(2,630)




(4,293)




(2,317)


Proceeds from long-term debt



350,000




129,186




400,000


Repayment of long-term debt



(40,000)




(166,186)




(34,000)


Proceeds from short-term borrowings



295,000




250,000




400,000


Repayment of short-term borrowings



(285,000)




(125,000)




(625,000)


Proceeds from issuance of common shares under stock-based
compensation plans



15,528




14,034




19,670


Payment for net settlement of stock-based awards



(10,296)




(15,919)




(3,850)


Payment of earn-out/deferred consideration



(6,219)




(3,356)




(12,790)


Dividend paid



(46,686)




(57,102)




(64,671)


Payment for stock repurchased and retired



(219,784)




(154,058)




(30,000)


Payment for expenses related to stock repurchase



(16)




(98)




(15)


Net cash provided by/(used for) financing activities


$

47,189



$

(135,187)



$

39,647


Effect of exchange rate changes



37,568




(64,346)




(11,716)


Net increase (decrease) in cash and cash equivalents



44,277




(71,726)




110,416


Cash and cash equivalents at the beginning of the period



422,623




504,468




368,396


Cash and cash equivalents at the end of the period


$

504,468



$

368,396



$

467,096


Supplementary information













Cash paid during the period for interest (including interest
rate swaps)


$

27,915



$

41,484



$

45,084


Cash paid during the period for income taxes (net of refunds)


$

66,238



$

81,411



$

104,217


Property, plant and equipment acquired under capital/finance
lease obligations


$

2,318



$

2,031



$

5,008


Non-cash transaction: Gain on exchange of non-monetary asset


$

(4,100)



$



$

(31,380)


 

Non-GAAP Financial Measures

To supplement the consolidated financial statements presented in accordance with GAAP, this press release includes the following non-GAAP financial measures:

  • Adjusted income from operations attributable to shareholders of Genpact Limited, or adjusted income from operations;
  • Adjusted income from operations margin;
  • Adjusted diluted earnings per share attributable to shareholders of Genpact Limited, or adjusted diluted earnings per share; and
  • Revenue growth on a constant currency basis.

These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP financial measures used by other companies. Accordingly, these non-GAAP financial measures, the financial statements prepared in accordance with GAAP and the reconciliations of Genpact's GAAP financial statements to such non-GAAP financial measures should be carefully evaluated.

Prior to July 2012, Genpact's management used financial statements that excluded significant acquisition-related expenses, amortization of related acquired intangibles, and amortization of acquired intangibles recorded at the company's formation in 2004 for its internal management reporting, budgeting and decision-making purposes, including comparing Genpact's operating results to that of its competitors. However, considering Genpact's frequent acquisitions of varying scale and size, and the difficulty in predicting expenses relating to acquisitions and the amortization of acquired intangibles thereof, since July 2012 Genpact's management has used financial statements that exclude all acquisition-related expenses and amortization of acquired intangibles for its internal management reporting, budgeting and decision-making purposes, including comparing Genpact's operating results to those of its competitors. For the same reasons, since April 2016 Genpact's management has excluded the impairment of acquired intangible assets from the financial statements it uses for internal management purposes. Acquisition-related expenses are excluded in the period in which an acquisition is consummated.

Genpact's management also uses financial statements that exclude stock-based compensation expense. Because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use when adopting ASC 718 "Compensation-Stock Compensation," Genpact's management believes that providing non-GAAP financial measures that exclude such expenses allows investors to make additional comparisons between Genpact's operating results and those of other companies. Additionally, in its calculations of such non-GAAP financial measures, Genpact's management has adjusted foreign exchange gains and losses, interest income and expense and income tax expenses from GAAP net income attributable to Genpact Limited shareholders, and other income and expenses, certain gains, losses and impairment charges attributable to equity-method investments, and gains or losses attributable to non-controlling interests from GAAP income from operations because management believes that the Company's results after taking into account these adjustments more accurately reflect the Company's ongoing operations. For the purpose of calculating adjusted diluted earnings per share, the combined current and deferred tax effect is determined by multiplying each pre-tax adjustment by the applicable statutory income tax rate.

Genpact's management provides information about revenues on a constant currency basis so that revenues may be viewed without the impact of foreign currency exchange rate fluctuations compared to prior fiscal periods, thereby facilitating period-to-period comparisons of the Company's true business performance. Revenue growth on a constant currency basis is calculated by restating current-period activity using the prior fiscal period's foreign currency exchange rates adjusted for hedging gains/losses in such period.

Accordingly, Genpact believes that the presentation of adjusted income from operations, adjusted income from operations margin, adjusted diluted earnings per share and revenue growth on a constant currency basis, when read in conjunction with the Company's reported results, can provide useful supplemental information to investors and management regarding financial and business trends relating to its financial condition and results of operations.

A limitation of using adjusted income from operations and adjusted income from operations margin versus income from operations, income from operations margin, net income attributable to Genpact Limited shareholders and net income attributable to Genpact Limited shareholders margin calculated in accordance with GAAP is that these non-GAAP financial measures exclude certain recurring costs and certain other charges, namely stock-based compensation and amortization and impairment of acquired intangibles. Management compensates for this limitation by providing specific information on the GAAP amounts excluded from adjusted income from operations and adjusted income from operations margin.

The following tables show the reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures for the year and three months ended December 31, 2018 and 2019: 

 

 

Reconciliation of Net income attributable to Genpact Limited shareholders/Margin to Adjusted Income
from Operations/Margin

(In thousands)




Year ended December 31,



Three months ended December 31,




2018



2019



2018



2019


Net income attributable to Genpact Limited shareholders


$

282,019



$

304,881



$

79,147



$

82,198


Less: Foreign exchange (gains) losses, net



(15,239)




(7,729)




(186)




(4,083)


Add: Interest (income) expense, net



37,119




43,458




9,473




9,971


Add: Income tax expense



80,763




94,536




27,495




32,151


Add: Stock-based compensation



48,998




83,885




16,840




22,579


Add: Amortization of acquired intangible assets



37,292




31,458




9,333




8,768


Add: Acquisition-related expenses



2,362




8,352







7,385


Adjusted income from operations


$

473,314



$

558,841



$

142,102



$

158,969


Net income attributable to Genpact Limited shareholders margin



9.4

%



8.7

%



9.5

%



8.7

%

Adjusted income from operations margin



15.8

%



15.9

%



17.0

%



16.9

%

 

 

Reconciliation of Income from Operations/Margin to Adjusted Income from Operations/Margin

(In thousands)




Year ended December 31,



Three months ended December 31,




2018



2019



2018



2019


Income from operations


$

348,152



$

429,376



$

110,841



$

119,518


Add: Stock-based compensation



48,998




83,885




16,840




22,579


Add: Amortization of acquired intangible assets



37,292




31,458




9,333




8,768


Add: Acquisition-related expenses



2,362




8,352







7,385


Add: Other income (expense), net



35,761




5,786




5,078




719


Less: Equity-method investment activity, net



(12)




(16)




10





Add: Net loss attributable to redeemable non-controlling interest



761











Adjusted income from operations


$

473,314



$

558,841



$

142,102



$

158,969


Income from operations margin



11.6

%



12.2

%



13.3

%



12.7

%

Adjusted income from operations margin



15.8

%



15.9

%



17.0

%



16.9

%

 

 

Reconciliation of Diluted EPS to Adjusted Diluted EPS10

(Per share data) 




Year ended December 31,



Three months ended December 31,




2018



2019



2018



2019


Diluted EPS


$

1.45



$

1.56



$

0.41



$

0.42


Add: Stock-based compensation



0.25




0.43




0.09




0.11


Add: Amortization of acquired intangible assets



0.19




0.16




0.05




0.04


Add: Acquisition-related expenses



0.01




0.04







0.04


Less: Tax impact on stock-based compensation



(0.06)




(0.10)




(0.02)




(0.02)


Less: Tax impact on amortization of acquired intangible assets



(0.05)




(0.04)




(0.01)




(0.01)


Less: Tax impact on acquisition-related expenses






(0.01)







(0.01)


Adjusted diluted EPS


$

1.80



$

2.05



$

0.52



$

0.57


 

The following tables show the reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP measures for the year ending December 31, 2020:

 

Reconciliation of Outlook for Net income attributable to Genpact Limited shareholders Margin to
Adjusted Income from Operations Margin11




Year ending

December 31, 2020


Net income attributable to Genpact Limited shareholders margin



8.8

%

Add: Foreign exchange (gains) losses, net



Add: Interest (income) expense, net



1.1

%

Add: Income tax expense



2.8

%

Add: Estimated stock-based compensation



2.1

%

Add: Estimated amortization of acquired intangible assets



1.1

%

Add: Estimated acquisition-related expenses



0.1

%

Adjusted income from operations margin



16.0

%

 

 

Reconciliation of Outlook for Income from Operations Margin to Adjusted Income from Operations
Margin
11




Year ending

December 31, 2020


Income from operations margin



12.7

%

Add: Estimated stock-based compensation



2.1

%

Add: Estimated amortization of acquired intangible assets



1.1

%

Add: Estimated acquisition-related expenses



0.1

%

Add: Estimated other income (expense), net



Less: Estimated equity-method investment activity, net



Adjusted income from operations margin



16.0

%

 

 

Reconciliation of Outlook for Diluted EPS to Adjusted Diluted EPS11

(Per share data)




Year ending December 31, 2020




Lower



Upper


Diluted EPS


$

1.73



$

1.77


Add: Estimated stock-based compensation



0.43




0.43


Add: Estimated amortization of acquired intangible assets



0.22




0.22


Add: Estimated acquisition-related expenses



0.02




0.02


Less: Estimated tax impact on stock-based compensation



(0.10)




(0.10)


Less: Estimated tax impact on amortization of acquired intangibles



(0.06)




(0.06)


Less: Estimated tax impact on acquisition-related expenses







Adjusted diluted EPS


$

2.24



$

2.28


 

1 Revenue growth on a constant currency basis is a non-GAAP measure and is calculated by restating current-period activity using the prior fiscal period's foreign currency exchange rates adjusted for hedging gains/losses in such period.

2 Adjusted diluted earnings per share is a non-GAAP measure. A reconciliation of GAAP diluted earnings per share to adjusted diluted earnings per share is attached to this release.

3 Adjusted income from operations and adjusted income from operations margin are non-GAAP measures. Reconciliations of each of GAAP income from operations and GAAP net income attributable to Genpact Limited shareholders to adjusted income from operations and GAAP income from operations margin and GAAP net income attributable to Genpact Limited shareholders margin to adjusted income from operations margin are attached to this release.

4 New bookings, an operating measure, represents the total contract value of new contracts and certain renewals, extensions and changes to existing contracts.  Regular renewals of contracts with no change in scope are not counted as new bookings.

5 During the year ended December 31, 2019, GE divested certain businesses that Genpact continues to serve. We have reclassified the revenue from such GE-divested businesses as Global Client revenue. If we had not reclassified such revenue, Global Client revenues for the full year 2019 and quarter ended December 31, 2019 would have been $3.03 billion and $808 million, respectively, and GE revenues would have been $489 million and $133 million, respectively.

6 Adjusted income from operations margin is a non-GAAP measure.  A reconciliation of the outlook for each of GAAP income from operations margin and GAAP net income attributable to Genpact Limited shareholders margin to adjusted income from operations margin is attached to this release.

7 Adjusted diluted earnings per share is a non-GAAP measure.  A reconciliation of the outlook for GAAP diluted earnings per share to adjusted diluted earnings per share is attached to this release.

8 Cost of revenue, selling, general and administrative expenses, other income (expense) and income from operations for the three months ended December 31, 2017 have been restated due to the adoption of ASU No. 2017-07 with effect from January 1, 2018.  The impact of such restatement is not material.

9 Cost of revenue, selling, general and administrative expenses, other income (expense) and income from operations for the year ended December 31, 2017 have been restated due to the adoption of ASU No. 2017-07 with effect from January 1, 2018.  The impact of such restatement is not material.

10 Due to rounding, the numbers presented in this table may not add up precisely to the totals provided.

11 Due to rounding, the numbers presented in this table may not add up precisely to the totals provided.

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/genpact-reports-full-year-and-fourth-quarter-2019-results-301000637.html

SOURCE Genpact