The jury’s in — the back-to-basics strategy is working at WNS. The results of this strategy pop out in its FQ3-14 earnings report. Net revenue increased 5 percent to $120 million. Gross profit increased 16 percent year over year to $45 million. SG&A expense went down four percent. Adjusted earnings per share rose to $0.38, above the consensus of $0.36. During Q3 WNS also signed its fourth-largest deal to date.
When Keshav Murugsh took over the CEO reins at WNS, he instituted a new management team, simplified the value proposition, focused on the arbitrage market and drove a more aggressive sales strategy. It’s a classic back-to-basics strategy, and the market is rewarding WNS in revenue growth, an eye-popping shareholder value and 107 percent year-to-date returns through December 2013.
Many of the Indian service providers are going back to the basics after investing in the products space in lieu of the services space. WNS was one of the first to return to this basics strategy, and Infosys followed closely on its heels with a similar strategy. Like the ABCs are basics for the benefits of reading and writing, the Indian services firms are finding fertile ground in getting back to the basics with increased execution, and the results that follow show customers and shareholders are enriched.