2. Disclaimer
This presentation has been prepared by CMC solely for providing information about the Company.
Certain statements in this presentation 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 risk and uncertainties relating to these statements include, but are not limited
to, risk and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense
competition in IT services including those factors, which may affect our cost advantage, wage
increases, our ability to attract and retain highly skilled professional, time and cost overruns on fixed
price contracts, our ability to manage our international operations, reduced demand of technology in
our key focus areas and our software products and solutions, withdrawal of Government fiscal
incentives, political instability, un-authorized use of our intellectual property and general economic
conditions affecting our industry. CMC, from time to time, make additional written or oral forward
looking statements, including our report to shareholders. The Company does not undertake to update
any forward looking statement that may have been made from time to time by or on behalf of the
Company. This communication is for general information purposes only, without regard to specific
objectives, financial situations and needs of any particular person. Please note that investments in
securities are subject to risks including loss of principal amount. The Company does not accept any
liability whatsoever, direct or indirect, that may arise from the use of the information herein.
2
3. Revenue – FY 2004-05
• Total Revenue is marginally up Total Revenue
2.5% at Rs. 782 crores (Rs crore )
800 782
compared with Rs. 764 crores 764
750
in last year.
• Revenue Growth driven by 700
E&T and International. 650
• E&T is up 55% from Rs. 17.8 600
crs to Rs. 27.6 crs;
550
International Revenues up
32% from Rs. 135.4 crs to Rs. 500
FY 04 FY 05
179.3 crs.
• International Revenue growth
driven by Embedded Systems.
3
8. Profitability – FY 2004-05
PBT PAT
PBDIT (Adj)
(Rs crore) (Rs crore)
(Rs crore)
70 60
65.71
70
63.88
62.22
60 47.99
50 60
50
50
40
40
40
32.94
30
23.06
30
30
20
20
20
10
10
10
0 0
0
FY 04 FY 05 FY 04 FY 05
FY 04 FY 05
• Profit before tax is down 50% at Rs. 32.9 crores compared with Rs. 65.7 crs in
last year;
• Profit after tax down 50% Rs. 23.1 crs. compared with Rs. 48.0 crs in last year;
• Profitability impacted primarily due to provisioning against receivables from two
international clients (Rs. 16 crs) due to suspension of work following their
organizational restructuring.
• Miscellaneous Income Lower by Rs. 9.8 crs; last year there was earlier-year
provisions written back (Rs. 10.14 crs)
(PBDIT adjusted for variation due to Misc. income, provisioning for bad & doubtful debts and exchange losses)
8
9. Consolidated Financial Performance
• Revenue of CMC Americas
(Rs crore) FY05 FY04 Growth
Y-o-Y
higher by 8% at $ 19.8 mn
Total Revenue 814.2 801.8 1.6% compared with $ 18.2 mn last
year.
PBT 34.7 62.9 -55.2%
• CMC Americas turn out
PBT Margins 4.3% 7.9%
profitable year for the first time
PAT 24.8 44.8 -44.6%
after acquisition by TCS, with a
net profit of $ 388K compared
PAT Margin 3.0% 5.6%
with a loss of $ 707k in last
year.
• Focus is on increasing
solutions and embedded
systems revenue in Americas
9
11. Shareholder Value
EPS (Rs.) Book Value
35.00 140
31.38
116
30.00 120
106
25.00 100
20.00 80
15.22
15.00 60
10.00 40
5.00 20
0.00 0
FY04 FY 05 FY04 FY 05
(Book value is after dividend of Rs. 4.50 per share proposed for FY 05 subject to shareholders approval) )
11
12. Debtors Profile – Q4 (FY 2004-05)
• Debtors level (after provisions)
30-60 days
increases to Rs. 248 Crs (116 days) 60-90 days
8%
8%
from Rs. 208 Crs (97 days) at the
beginning of the quarter and Rs. 180
Crs. (86 days) at the beginning of the 90-180 days
year due to higher year end billing. 13%
0-30 days
56%
• Debtors above 90 days fall from 32% to
28% during the year.
• Unbilled debtors falls to Rs. 94 Crs. (44 >180 days
15%
days) from Rs. 155 crs. (73 days) at the
beginning of the quarter and Rs. 115
crs (55 days) at the beginning of the
year.
12
15. Manpower (FY 2004-05)
(Numbers)
• Net addition of 177 people in FY
3500
2004-05.
3162
3082
• Focus on building capabilities 2985
3000 2883
and competencies especially in
niche technology like embedded 2500
systems etc. and select domains.
2000
• Compensation packages
restructured to incorporate skill
1500
and domain premium.
1000
Q1 Q2 Q3 Q4
15
16. Key Focus Areas
• Improve revenue mix:
•Increase International Revenues (Growth of 32.5% in FY 05 over FY 04)
•Defocus from pure equipment business unless accompanied by service
business (This year equipment business remained flat at Rs. 379 crores)
• Build sustained service revenue stream around niche areas like Embedded
systems and CMC’s solutions (Embedded systems grew more than 200% in
FY 2004-05)
• Capitalize on resurgent Education and Training market (E&T revenue grew
55% over last year)
• Process Improvement – Roll-out of Ultimatix from 1st April, 2005
• Human Resources – Skill and compensation management; net addition of 177
people in FY 2004-05; introduction of skill and domain premium in
compensation package.
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