TeamLease Q3 profit dips 5% YoY, board to consider share buyback next week

The company's revenue grew 14% YoY to Rs 2,108 cr in the quarter ended December, from Rs 1,767 crore a year ago. EBITDA fell 16% to Rs 32 crore in Q3

Staffing firm TeamLease Services Ltd on Wednesday reported a dip in its net profit for the third quarter of FY23 at Rs 29 crore. This is a 9 per cent quarter-on-quarter (QoQ) decline from Rs 32 crore in Q2 and a 5 per cent year-on-year (YoY) decline from the same period last financial year, which saw a profit of Rs 30 crore.  

The company’s revenue grew 14 per cent YoY to Rs 2,108 crore in the quarter ended December, from Rs 1,767 crore a year ago. EBITDA for the firm fell 16 per cent to Rs 32 crore in Q3 from Rs 38 crore.

“Weak festive demand in general staffing and headwinds in specialised staffing impacted our growth rates this quarter both on a QoQ and YoY basis,” said Ashok Reddy, Managing Director, TeamLease Services Limited.

“Margins will be under pressure for the coming quarters given the soft demand, realization pressure, NEEM impact. Core employee headcount has been reduced by 9 per cent on account of digitization and tighter cost control,” he added.

The company is also considering a buyback of equity shares next week. In a regulatory filing, the company stated that “we wish to hereby inform you that the meeting of the Board of Directors of the Company is scheduled to be held on Friday, February 03, 2023, at 10:00 A.M. IST, inter-alia, to consider and if deem fit, to review, consider and approve the proposal for buyback of the equity shares of the Company as well as matters related / incidental thereto.”

In terms of general staffing, TeamLease claims to have added a net headcount of ~3,000 in Q3FY23 with growth of 1 per cent on QoQ basis and 13 per cent on YoY basis. “While headcount grew in Oct-Nov, higher attrition in December led to only 3k net growth,” the firm said. While in terms of IT staffing, headcount grew by ~2 per cent on a QoQ basis on account of addition in professional staffing.

The trading window for dealing in the securities of the company will be closed from January 30, 2023 till February 07, 2023.