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Earnings Highlights and Review: Luxoft's Q4 Top-line Increases 20.6% Y-o-Y; Outshined Forecasts

Research Desk Line-up: Mobileye Post Earnings Coverage

LONDON, UK / ACCESSWIRE / June 9, 2017 / Pro-Trader Daily publishes post-earnings coverage on Luxoft Holding, Inc. (NYSE: LXFT) following the Company's announcement of its financial results for the fourth quarter fiscal 2017 (Q4 FY17) and full year fiscal 2017 (FY17) on May 22, 2017. The Zug, Switzerland-based Company's quarterly GAAP revenue rose 20.6% y-o-y; beating market consensus estimates. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at: http://protraderdaily.com/register/.

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Earnings Reviewed

During the quarter ended on March 31, 2017, Luxoft's GAAP revenue grew to $204.13 million from $169.21 million recorded at the end of Q4 FY16. GAAP revenues numbers for Q4 FY17 topped market consensus estimates of $200.7 million. On a constant currency basis, revenue growth in the reported quarter was 22.0% y-o-y.

The software and IT Company's GAAP net income came in at $13.74 million, or $0.40 per diluted share, in Q4 FY17 compared to $14.59 million, or $0.43 per diluted share, in Q4 FY16. The Company's adjusted net income increased to $21.50 million, or $0.63 per diluted share, in Q4 FY17 from $18.84 million, or $0.56 per diluted share, in the previous year's same quarter. Wall Street had expected the Company to report adjusted net income of $0.64 per diluted share.

In FY17, Luxoft's GAAP revenue came in at $785.56 million, up 20.7% from $650.75 million in the previous year. However, the Company GAAP net income fell to $62.64 million, or $1.84 per diluted share, in FY17 from $70.25 million, or $2.06 per diluted share, in FY16. Meanwhile, the Company reported adjusted net income of $98.31 million, or $2.89 per diluted share, in FY17 compared to $92.86 million, or $2.72 per diluted share, in FY16.

Operational Metrics

For the reported quarter, the Company's GAAP operating income was $11.43 million, or 5.6% of revenues, versus $14.16 million, or 8.4% of revenues, in Q4 FY16. Meanwhile, non-GAAP operating income came in at $21.31 million, 10.4% of revenues, in Q4 FY17 compared to $18.85 million, or 11.1% of revenues, in Q4 FY16. Luxoft posted EBITDA of $23.33 million in Q4 FY17 compared to $23.72 million in the year ago same quarter. Additionally, the Company's adjusted EBITDA stood at $29.22 million, or 14.3% of revenues, in Q4 FY17 from $26.55 million, or 15.7% of revenues, in the last year's comparable quarter.

Revenues by Verticals

During Q4 FY17, five of Luxoft's seven verticals experienced revenue growth with Telecom, Automotive and Transport, Energy, and Financial Services delivering year-over-year growth.

Luxoft's Financial Services revenues stood at $115.96 million in Q4 FY17, growing marginally from $115.33 million in Q4 FY16. Moreover, the vertical's contribution to the Company's total revenues fell to 56.8% in Q4 FY16 from 68.2% in the year ago same quarter.

Automotive and transport vertical's revenues increased to $29.44 million in Q4 FY17 from $22.74 million in Q4 FY16. The vertical's contribution to the Company's total revenues also increased from 13.4% in Q4 FY16 to 14.4% in Q4 FY17.

Revenues from Telecom vertical surged to $23.09 million in Q4 FY17 from $9.93 million in Q4 FY16. The vertical's share in the Company's total revenues also increased to 11.3% in Q4 FY17 from 5.9% in Q4 FY16.

During the reported quarter, revenues from Technology and Energy verticals grew to $14.51 million and $4.04 million, respectively, from $8.99 million and $3.36 million, respectively, in Q4 FY16. However, revenues from Travel and Aviation vertical were down to $6.15 million in Q4 FY17 from $7.43 million in Q4 FY16. Moreover, the Company's newly introduced healthcare and life sciences vertical posted revenues of $9.59 million in Q4 FY17.

Cash Flow & Balance Sheet

During full-year FY17, Luxoft's net cash provided by operating activities were $122.03 million, up from $105.39 million in FY16. Moreover, free cash flow rose 29.0% y-o-y in FY17 to $98.2 million, or 12.5% of revenues. Furthermore, Luxoft had $109.56 million in cash and cash equivalents as on March 31, 2017, compared to $108.55 million at the close of books on March 31, 2016.


In its guidance for full year ending March 31, 2018, Luxoft's management expects of at least 20.0% y-o-y to approximately $943 million. Adjusted EBITDA for FY18 is forecasted to be in the range of 17.0% to 19.0%. Furthermore, the Company anticipates GAAP diluted EPS of at least $1.90 for full year FY18, while non-GAAP diluted EPS is forecasted to be at least $3.26.

Stock Performance

On Thursday, June 08, 2017, the stock closed the trading session at $63.30, slightly falling 0.71% from its previous closing price of $63.75. A total volume of 103.09 thousand shares have exchanged hands. Luxoft's stock price surged 10.96% in the past three months, and 18.43% in the previous six months. Furthermore, since the start of the year, shares of the Company have rallied 12.63%. The stock is trading at a PE ratio of 33.62 and currently has a market cap of $2.11 billion.

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