Alldigi Tech Limited — Interim / Quarterly Report 2021

Jan 20, 2021

January 20, 2021

Listing Department, BSE Ltd., Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001 Scrip Code: 532633

Listing Department, National Stock Exchange of India Limited, "Exchange Plaza", Bandra-Kurla Complex, Bandra (East), Mumbai-400 051 Symbol: ALLSEC

Sub: Submission of Press Release and Investor's Presentation

Dear Sir/Madam,

Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, kindly find enclosed following documents:

• 1. Press Release dated January 20, 2021.
• 1. Investor's Presentation on the financial performance of the Company.

Request you to take the same on record.

Thank you,

Yours faithfully,

For Allsec Technologies Limited

ALLSEC TECHNOLOGIES LTD.

Regd. Office: 46-C, Velachery Main Road, Velachery, Chennai - 600 042 Tel: +91.44.4299 7070 web: www.allsectech.com Corporate Identity Number: L72300TN1998PLC041033, Email: contactus@allsectech.com

20th January 2021

BSE: 532633 I NSE: ALLSEC I ISIN: INE835G01018 I CIN: L72300TN1998PLC041033 I WWW.ALLSECTECH.COM

Revenue rebounds, with 460 bps EBITDA margin expansion and 38% PAT growth

Chennai, India – 20th January 2021: Allsec Technologies, a global leader in outsourcing solutions announced its financial results for the third quarter (Q3 FY21) ended 31st December 2020.

Highlights include:

• Strong rebound in revenues, with 6% growth over Q2'FY21
• Sterling operating performance with EBITDA margin higher by 460 bps QoQ
• Continuing robust cash generation with OCF/EBITDA at 96%

Key financial highlights

In ₹ lakh

Particulars	Q3FY21	Q2FY21	QoQ (%)	Q3FY20	YoY (%)
Revenue	7,169	6,760	6%	7,233	(1%)
EBITDAbeforeCOVIDexpenses & MTM Fx	1,994	1,749	14%	1,517	31%
COVID expenses	(117)	(148)	(21%)	-	-
MTM Fx Gain / (loss)	(71)	(207)	(66%)	130
EBITDA	1,806	1,393	30%	1,647	10%
EBITDA margin (%)	25%	21%	460 bps	23%	242 bps
PBT	1,248	814	53%	1,158	8%
PAT	887	644	38%	855	4%
PAT Margin (%)	12%	10%	283 bps	12%	55 bps
Diluted EPS (in ₹)	5.82	4.22	38%	5.61	4%

The Company has rebounded quickly, ending the quarter with revenues close to Q3 FY20 levels. Operational efficiencies drove EBITDA higher than Q3 FY20, despite continued COVID-related costs (e.g., WFH solutions, additional office capacity to maintain social distancing norm).

Q3 FY21 Financial Highlights:

• Quarterly revenues higher 6% QoQ, at ₹ 71.7 cr.
  • o Digital Business Services (DBS) segment revenues higher 10% QoQ, at ₹47.5 cr.
  • o Human Resource Operations (HRO) segment revenue flat QoQ, at ₹24.2 cr.
• Quarterly EBITDA higher 30% QoQ, at ₹ 18.1 cr.
• Quarterly Profit after Tax (PAT) higher 38%, at ₹8.9 cr.
• Diluted Earnings Per Share (EPS) higher 38%, at ₹5.82
• OCF/EBITDA conversion at 96%

Business Update

• Digital Business Services (Customer Lifecycle Management):
  • International business revenues remained flat QoQ, at ₹29.5 Cr. The business continues to face lower volumes especially in the collections business in the US.
  • Domestic business revenues up 32% QoQ, back to pre-COVID levels at ₹17.9 Cr. This is the business' second consecutive quarter with >30% growth. However, challenges with respect to transportation of employees and additional capacity to manage social distancing norms are impacting profitability.
• Human Resources Operations:
  • Domestic business excluding Stat Compliance grew 2% QoQ, at ₹13.1 Cr.
  • International business grew 8% QoQ, at ₹5.6 Cr.
  • 25 new customers were added during the quarter.
  • Payslips processed grew 7% QoQ and 18% YoY, at 25 lakh in Q3 FY21.

Commenting on the performance, Mr. Suraj Moraje, Non-Executive Director said, "The Allsec management team has done a commendable job of returning the business to its pre-COVID levels and at significantly higher margins. We will continue to invest in growing the business, building superior technology, and furthering operational efficiencies."

About Allsec Technologies Limited

Allsec Technologies Limited (BSE: 532633, NSE: ALLSEC), headquartered in Chennai, is a pioneer in the HRO space and is today India's second largest Payroll Service Provider. Founded in 1998, Allsec has emerged as a global brand, offering high-end business process solutions across key industry verticals in 40 countries. With ~ 4,000 employees across India, UK, the Philippines and the US, Allsec processes more than 8 lakh pay slips each month for over 200 legal entities around the world. Allsec's unique SmartHR and SmartPay platforms are designed to address the complex challenges in today's HR environment, and the company has integrated the latest in tech – Robotic Process Automation (RPA), Smart Analytics, Chatbots and Mobility for enhanced employee engagement.

For further details on Allsec Technologies Limited, please visit: http://www.allsectech.com.

For more information, please contact:

Investor / Analyst contact:

Gagan Preet Singh

Investor Relations

investorcontact@allsectech.com

+91 44 4299 7070

Disclaimer: This document contains statements that constitute forward-looking statements. These statements include descriptions regarding the intent, belief or current expectations of the Company or its directors and officers with respect to the results of operations and financial condition of the Company. These statements can be recognized by the use of words such as ''expects", "plans", 'will", "estimates", "projects", or other words of similar meaning. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those in such forward-looking statements as a result of various factors and assumptions, which the Company believes to be reasonable in light of its operating experience in recent years. The risks and uncertainties relating to these statements include, but not limited to, risks and uncertainties, regarding fluctuations in earnings, our ability to manage growth, competition, our ability to manage our international operations, government policies, regulations, etc. The Company does not undertake any obligation to revise or update any forward looking statement that may be made from time to time by or on behalf of the Company including to reflect actual results, changes in assumptions or changes in factors affecting these statements.

Building lasting relationships

Investor Presentation

Q3FY21

Safe Harbor

This presentation has been prepared by Allsec Technologies Limited ("Company") solely for information purposes without any regard to any specific objectives, financial situations or informational needs of any particular person. This presentation may not be copied, distributed or disseminated, directly or indirectly, in any manner. Failure to comply with this directive may result in a violation of the applicable law in certain jurisdictions. By reviewing this presentation, you agree to be bound by the restrictions contained herein, and to maintain absolute confidentiality, regarding the information disclosed in these materials. This presentation does not constitute or form part of and should not be construed as, directly or indirectly, any offer or invitation or inducement to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of the Company by any person in any jurisdiction, including in India, nor shall it or any part of it or the fact

of its distribution form the basis of, or be relied on in connection with, any investment decision or any contract or commitment therefor. This presentation contains statements that constitute forward looking statements. These statements include descriptions regarding the intent, belief or current expectations of the Company or its directors and officers with respect to the results of operations and financial condition of the Company. These statements can be recognized by the use of words such as ''expects", "plans", 'will", "estimates", "projects", or other words of similar meaning. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those in such forward-looking statements as a result of various factors and assumptions which the Company believes to be reasonable in light of its operating experience in recent years. The risks and uncertainties relating to these statements include, but not limited to, risks and uncertainties, regarding fluctuations in earnings, our ability to manage growth, competition, our ability to manage our international operations, government policies, regulations, etc. The Company does not undertake any obligation to revise or update any forward looking statement that may be made from time to time by or on behalf of the Company including to reflect actual results, changes in assumptions or changes in factors affecting these statements. Given these risks, uncertainties and other factors, viewers of this presentation are cautioned not to place undue reliance on these forward looking statements. This presentation may contain certain currency exchange rates and the same have been provided only for the convenience of readers.

Contents

Company Overview

Q3FY21 Key Business Highlights

Financial Performance (Q3 and 9 months FY21)

Business segments update

Annexures

Company Overview

Global leader in outsourcing solutions

Quess Corp subsidiary, backed by Fairfax Holdings (Canada)

20+ years of Global BPO service Excellence

2 Decades in Delivering Global Business Solutions

Service Delivery bundled with Digital Transformations

400+ Client engagements globally including Fortune 100 companies 1M+ payslips processed per

Listed at the NSE & BSE (NSE: ALLSEC)

~4000 driven and dedicated employee workforce

month groupwide

200,000+ monthly employee self service portal log-ins

Market Leader in HRO Services

Leading Global BPM Player specializing in BFSI, E-Com, Retail and Consumer Electronics

Leading provider of HRO end-to-end services

BPM: Cutting edge Digital Business Services offerings

Customer Experience Management

Credit Risk Management

Transaction Processing

Compliance

• Customer Support
• Tech Support
• Customer Acquisition
• Debt Collections
• Fraud Detection & Risk Management
• Accounts Receivable
• Accounts Payable
• Account Research
• Mortgage Services
• Anti-Money Laundering Investigations
• KYC / Customer Onboarding
• Legal Transcription
• Compliance Monitoring
• Healthcare RCM Revenue Cycle Management

Global Delivery capabilities

• Global Footprint with proximity to Servicing Markets.
• ~4000 employee workforce.
• Multi-Industry, Multinational & Multi-Demographic coverage.

Chennai (HQ), Bangalore, Noida, INDIA

• Hindi
• English
• Tamil • Gujarati
• Telugu
• Kannada
• Malayalam

Manila, PHILIPPINES

• Mandarin
• Spanish
• Japanese • Malay
• German • Bahasa-Indonesia

• Marathi • Punjabi

• Bengali

• Odia

• Arabic

• Portuguese

• Turkish • Italian
• French • English • Polish

Dallas, Texas USA

Q3FY21 Key Business Highlights

Q3FY21 Highlights

• Sterling performance in current quarter with both FY20 (excluding seasonal year end EBITDA from HRO). o Revenue up 6% QoQ with strong bounce back in 13.4cr from Sep 2020 to ₹ 184.6 cr
• Headcount: 4216 as on Dec 31, 2020 an increase of 315 over Sep 30, 2020 and increase of 224 over March 31, 2020 ₹ 37.5cr in September 2020 to ₹36.5cr
• P&L statement:
• the DBS Domestic business
• 30% QoQ
• o PAT at ₹ 8.9 cr, up 38% QoQ
• Balance Sheet:
• o Cash and short term investments increased by ₹
• o OCF / EBITDA at 96%
• o Strong collections reducing total receivables from
• o DSO reduced to 46 days from 50 days in September 2020

• FY22.
• o Entered into a partnership with a Global IT clients

Business

HRO:

• o Added net 160,000+ payslips during Q3 FY21 reflecting the return of growth in this quarter which was muted in H1 o EBIT margin improved 33% YoY to 35% in o Multi-Country deal with a customer taking us to new Geographies – Singapore & Indonesia o Increasing traction on standalone Time and Attendance solutions DBS: o Domestic business continued its strong bounce back with a QoQ revenue growth of 32% which follows a 39% QoQ growth in previous quarter o Volumes from DBS International remained flat QoQ. We expect an improvement in Q4 FY21 ACV worthy ~ ₹ 3cr will yield revenues from Q1 Company to provide payroll services to their

  • Q3'FY21

• o Working on Insurance BPaaS offering for the US market leveraging Quess's North America Sales force and their InsureTech platform

Financial performance

Q3FY21 Financial Performance

Revenue:

Profitability:

• Cash Generation:

• o Cash and short term investments increased by ₹13.4cr from

• o OCF / EBITDA at 96%

• Sep 2020 to ₹ 36.5cr.

• o DSO continued the reducing trend reflecting strong collections despite the ongoing pandemic and stood at 46 days as against 50 days in September 2020

Revenue (in ₹ lakh) EBITDA (in ₹ lakh) & margin (%age) YoY 34% QoQ 7% 1,647 1,855 1,299 1,393 1,806 23% 26% 20% 21% 25% 0 500 1000 1500 2000 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 YoY 10% QoQ 30% QoQ 36%

1500 PAT (in ₹ lakh) & margin (%age)

OCF (in ₹ lakh) & %age

9MFY21 Financial Performance

• by 2%

PAT (in ₹ lakh) & margin (%age)

OCF (in ₹ lakh) & %age

170% YoY 25%

BOT

Normal Business

YoY 14%

Business segment updates

Annexures

Income Statement

Income Statement
Consolidated		Quarterly		Var %			YTD Dec FY21
Particulars	Q3 FY21	Q2 FY21	Q3 FY20	QoQ%	YoY %	9M FY21	9M FY20	YoY %
Revenue from Operations	7,169	6,760	7,233	6%	-1%	20,321	22,330	-9%
Less:
Employee benefit expenses	(4,045)	(3,771)	(4,255)	7%	-5%	-11,388	-13,039	-13%
Other expenses	(1,318)	(1,596)	(1,331)	-17%	-1%	-4,435	-3,617	23%
Total expenses	(5,363)	(5,367)	(5,586)	0%	-4%	-15,823	-16,656	-5%
EBITDA	1,806	1,393	1,647	30%	10%	4,498	5,674	-21%
Other income	50	50	50	0%	0%	213	329	-35%
Finance cost	(37)	(82)	(44)	-55%	-16%	-155	-179	-13%
Depreciation & amortisation	(571)	(547)	(495)	4%	15%	-1,687	-1,477	14%
Earnings before exceptional item & tax	1,248	814	1,158	53%	8%	2,869	4,347	-34%
Exceptional item
Earnings before tax	1,248	814	1,158	53%	8%	2,869	4,347	-34%
Tax	(361)	(170)	(303)	112%	19%	-735	-940	-22%
Profit after tax	887	644	855	38%	4%	2,134	3,407	-37%
EBITDA Margin	25.2%	20.6%	22.8%	459 bps	242 bps	22.1%	25.4%	-328 bps
PAT margin	12.4%5.82	9.5%	11.8%	285 bps	55 bps	10.5%	15.3%	-476 bps
Basic & Diluted EPS (in ₹)		4.22	5.61	38%	4%	14.00	22.36	-37%

Balance Sheet

		Var %
		-41%
		68%
		-41%
		2%
		-14%
		12%
		19%
		-19%
		4%
		-15%
		8%
		3%
		10%
		-54%
		22%
		-34%
784	1,013	-23%
	3,321	-19%
2,675
3,459	4,334	-20%
	31-Dec-205231,3143,7383,64649629,77525,138607	31-Mar-208805593332,2273,3343,2545,7306,6953,33914,72412,4204,5021,4411,38258224,04522,22428,91922,8071,3115714671,1781,778

Thank you