Black Box Delivered Mixed Q1 FY25 Results: Revenue Down 9%, But PAT Rose 55%

Black Box Limited announced its unaudited financial results for the quarter ended June 30, 2024 (Q1 FY2025).

Revenue and Order Book

• Declining Revenue: Revenue dipped 9% YoY to 1,423 crore due to decision-making delays and project execution setbacks.
• Strong Pipeline and Order Book: Despite these challenges, the company’s pipeline remains robust, with the order book increasing to US$475 million by June 30, 2024.

EBITDA and EBITDA Margins

• Improved Margins: The company’s focus on margin enhancement and productivity resulted in positive outcomes.
• EBITDA Growth: EBITDA increased by 28% year-over-year (YoY) to ₹ 115 crores.
• Margin Improvement: EBITDA margins improved by 240 basis points YoY to 8.1%.
• FY25 Target: The company is targeting an EBITDA margin of 9% by the end of FY25.

Profit After Tax

• Strong PAT Growth: Operating performance led to increased profitability despite higher interest costs.
• Exceptional Items: Severance costs contributed to a rise in exceptional items to ₹ 15 crores.
• PAT Increase: PAT increased by 55% YoY to ₹ 37 crores, with PAT margins growing by 110 basis points YoY to 2.6%.

Commenting on the results and performance, Mr Sanjeev Verma, Whole Time Director, Black Box, said, “Our strategic exit from low-value, non-accretive customers had a short-term impact on revenue. However, our relentless focus on productivity and margins allowed us to meet EBITDA targets and nearly achieve PAT guidance. Core operations demonstrated robust strength, with substantial growth in key areas, highlighting the resilience of our business model. We have made significant strides, investing heavily in our Go-To-Market strategy and hiring seasoned sales and solution architects with industry-specific expertise. As we move into FY25, our focus will remain on capitalising on our strong pipeline and robust order book. With each business segment gaining momentum, we are confident in our ability to deliver enhanced performance and meet our revenue and profitability guidance.”

Mr. Deepak Kumar Bansal, Executive Director and Global Chief Financial Officer of Black Box, commented, “The growth in topline was affected due to delays in decision-making, leading to delayed project execution coupled with muted demand for our product business from some federal partners during the quarter. However, we continue to deliver on EBITDA and profitability over the last few quarters with a strong focus on productivity and deal margins, as evidenced by a 28% YoY growth in EBITDA and a 55% YoY increase in our profit after tax. We are optimistic that this trend will continue, enhancing both margins and overall profitability. Further, we secured ₹ 410 crores in funding to propel growth across key focus areas and to drive expansion in the digital infrastructure sector.

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