Sagility profit rises 13.3% in second quarter as revenue grows, margin narrows
Key Facts
Sagility reported a 13.3% year-on-year rise in net profit for the second quarter of fiscal 2027, with revenue increasing faster than earnings. The company said in its earnings statement that net profit reached 2,842 million rupees, compared with 2,508 million rupees in the corresponding quarter of fiscal 2026. Revenue for the quarter ended 30 September 2026 was about 20,321 million rupees, compared with 16,585 million rupees a year earlier, an increase of 22.5%. Revenue growth slowed from the pace the company reported in the second quarter of the previous fiscal year, when it recorded a year-on-year increase of 25.2%. In its results for that earlier period, Sagility had reported revenue growth of 20.0% in constant currency.
On operating profitability, reported earnings before interest, taxes, depreciation and amortisation rose to 5,252 million rupees from 4,733 million rupees in the corresponding period, according to the earnings statement. The measure grew 11.0% year on year, slower than revenue and net profit. Its margin fell to 25.8% from 28.5% in the second quarter of fiscal 2026, despite the increase in absolute earnings. Adjusted earnings before interest, taxes, depreciation and amortisation reached 5,353 million rupees, compared with 4,352 million rupees a year earlier, according to the investor presentation. The adjusted measure thus rose 23.0% year on year, outpacing growth in reported operating earnings. Adjusted net profit was 3,254 million rupees, according to the company's investor relations page. On foreign exchange, Sagility recorded a loss of 186 million rupees during the quarter, compared with a gain of 516 million rupees in the corresponding period.
Sagility said organic revenue growth reached 22.2% year on year in the second quarter of fiscal 2027. Organic growth was 11.9% in constant currency, compared with the organic growth rate measured in rupees. On business activity, the company said in its investor presentation that it won contracts with an annual value of $40.2 million during the same quarter. The contract wins came from 31 existing clients and one new client, meaning existing clients accounted for most of the clients covered by these contracts. Over the first half of the fiscal year, Sagility added 28 client groups, including clients acquired through the acquisition of Careseed, according to the earnings statement. Its total active client base reached 105 groups by the end of the first half of fiscal 2027.
Sagility provides healthcare operations transformation services in the U.S. market, serving insurers, healthcare providers and pharmacy benefit managers, according to its business description on its investor relations page. Healthcare payer services accounted for the largest share of the company's quarterly business, generating revenue of 18,262 million rupees in the second quarter of fiscal 2027. These services represented 89.9% of total revenue, according to the results infographic published by the company. Healthcare provider services, meanwhile, generated revenue of 2,059 million rupees, equivalent to 10.1% of quarterly revenue. Sagility had 51,486 employees at the end of the quarter, according to the same summary. In an expansion of its services, the company announced the acquisition of Shrock Health, which specialises in clinical documentation improvement.
Sagility said in its acquisition announcement that the deal "provides significant cross-selling opportunities across the two companies' client bases". On shareholder returns, the board declared an interim dividend of 0.15 rupees per share for fiscal 2027, according to the dividend filing. The company set 30 October 2026 as the record date for shareholders' eligibility for the interim dividend. The dividend is scheduled to be paid no later than 21 November 2026, according to the same filing. Alongside the cash dividend, Sagility aims to repay its debt in full during the current fiscal year, according to its results presentation.