INDUSTRY OUTLOOK:
Global air passenger continued with its solid growth with industry KPIs
within touching distance to pre-pandemic levels in international travel and crossing
pre-pandemic levels on domestic levels. Passenger load factors have also improved across
all regions. Carriers in Asia Pacific continue to lead growth as compared to peers in
other regions. Airlines have started placing large orders for aircrafts in anticipation of
the growing passenger and improving efficiencies from retiring older aircrafts.
IATA has forecasted that the Airlines industry will return to net
profit position in 2023 after sustaining significant losses during Covid period.
Airlines continue to focus on providing new ancillaries in market with
focus on customer travel experiences. These services are aimed to help passengers
personalize their travel experiences throughout their journey e.g. lounge access, seat
choice, meals etc. Some airlines are creating bundles where passenger fare includes
bundles like seats and meals. As part of the industry Modern Airline Retailing program are
looking to become truly customer centric and legacy-free with adoption of Offers and
Orders. Offers which will be powered by the New Distribution Capability (NDC) and Orders
which will be built around the One Order standards. This will allow agents to have direct
access to the airline content offered on their websites. The adoption of NDC and One Order
will reduce the airlines distribution costs, increase revenues, provide more control on
how their products are sold and improve customer satisfaction The International Air
Transport Association (IATA) maintains an optimistic outlook on the airline industrys
growth in 2023:
• Looking forward, the demand for air travel is expected to double
by 2040, growing at an annual average rate of 3.4%.
• Airline industry revenue is expected to reach $837 bn which is
95.5% of 2019 levels]
• The industry is returning to profitability in 2023, the net
profit forecast for this year is USD 9.8 billion
• Cargo revenue is still around double the pre-pandemic average
with volumes of 57.8 million tonnes
• Global passenger numbers will increase to 4.35 bn which is close
to the 5.54 bn of 2019 levels.
Risk facing the industrys growth in 2023:
• Global Inflation
• War in Ukraine
• Supply chain issues in global trade
• Regulatory costs burden due to passenger rights and regional
environmental initiatives ACCELYA GROUPS STRATEGY:
Accelyas financial service provides vital decision support and
reporting capabilities to support airlines and their importance post-pandemic has
increased even further as the airline embark on a road of sustained long term growth &
recovery.
Accelya continues to building on the Accelya Airline Retail Platform
around the NDC and One Order standards. With connections to the larger Offer and Order
offerings from Accelya Group portfolio, we can provide our customers value across Offer to
Settle. With our ONE Order focus, Accelya is well poised to drive technology
transformation within the airline industry that is looking forward to embracing new ways
of retailing & distribution. Our Order Accounting solution has been certified by IATA
and is being positioned to work with the airline Order Management System (OMS).
The project team strategized to adopt to IATA version 21.3 release for
finalizing the product requirements for this integration.
As part of Accelyas Offer to Settle vision, An Accelya Product
Integration (API) project was initiated to integrate the Orders with Order Accounting
solution and the initial architecture, development, and testing have been concluded. A
more detailed use cases and features are being planned as part of the next phase.
Our focus is to keep the long-term objectives in balance with short
term goals to ensure that we create the robust foundation for future growth while staying
resilient in these ever-evolving business environments. We continue to evolve our products
and services to ensure that we continue our leadership position in the airline commercial
and financial platform domain.
We continue to work with airlines and industry partners like IATA,
ATPCO to ensure that our end-to-end solutions help the airline during the recovery phase
and beyond.
The Strategic Product Governance (SPG) group that was setup to provide
direction to product in conjunction with customers has just completed its 10-year
anniversary this year. SPG has been instrumental in helping Accelya maintain product
leadership in the industry.
Our employees are at the heart of our growth. We have put in place the
right set of rewards and opportunities to enable us to attract, nurture and retain the
best talent.
ACCELYA SOLUTIONS MAJOR OFFERINGS:
Revenue Accounting, Revenue Assurance and Cost Management continue to
remain Companys key solutions.
New Distribution Capabilities (NDC) transactions have now started
flowing through our systems and we are now seeing increased adopt around the ancillaries
being offered.
The company continues developing Order Accounting solution in line with
IATA standards to meet requirements of the financial accounting side of NDC as well as
Settlement with Orders (SwO). The company formulated a roadmap map that covers the entire
Accounting to Settlement cycle and our investments in this area are on track.
The company continue to partner with airlines to ensure accurate
revenue declaration and control including plugging revenue leakages and improving the
quality of revenue, better manage cost, risk, cash flow, profitability, and overall
business performance.
Revenue Accounting and Assurance: Revenue Accounting is a complex
business process in an airline as it is responsible for accurate and timely revenue
declaration, ensuring interline payments are billed correctly and adherence to IFRS and
audit compliances. In addition, crucial strategic decisions are made using revenue
accounting data in an airline.
With over 30 years of experience and a leadership position in revenue
accounting, the Company enables leading global airlines to streamline and simplify their
revenue accounting processes. The company continues to work with airlines in addressing
business challenges like NDC which has been the seamless transition to the new retailing
world.
The Revenue Assurance Services portfolio covers a wide gamut of audit
services spanning the entire ticket lifecycle from original booking through to the
completion of the journey. This is supported by comprehensive recovery services —
from raising of Agent Debit Memos (ADMs) to fund collection.
Cost Management: Accelya Solutions Cost Management Solutions
enable airlines to manage their costs more smartly. It automates the payables process,
provides deeper insights into the costs, and facilitates wiser, more profitable decisions
every day. As a result, airlines can control supplier overpayments and transform their
procure-to-pay cycle.
Industry Partnerships ATPCO
The Company continues to provide NFP (Neutral Fare Proration) under
ATPCOs RASS (Revenue Accounting Settlement Services) powered by industry recognized
APEX? Proration Engine.
IATA
As an IATA Strategic Partner, the Company is involved in various
engagements. During the Covid times the relationship has been further extended and
strengthened. Some of the initiatives the Company is involved are as below:
NDC & One Order
The Company is actively involved in lATAs retailing initiative of NDC
& One Order since inception of the initiative. The relationship was further extended
to involve Settlement with Orders.
SIS Development & Support
The Company is providing high quality support to lATAs Simplified
Invoicing Settlement (SIS) platform to meet quality, system and information security
standards as expected by IATA.
ACCELYA SOLUTIONSUPDATES
Revenue Assurance - Accelya Managed Services
• Refunds volume continued to be high for few customers as COVID
related policy were still valid.
• Volume recovery resulted in higher volumes for sales audit and
in turn resulting in higher $ recoveries for airlines. Revenue Accounting
• The focus for flagship offering of Revenue Accounting for the
year was to align itself with lATAs NDC and One Order initiative. In line with this
objective the Company has been certified on IATA 21.3 standards for its One Order
Accounting solution.
• The company continues its investments in building Order
Accounting space and roadmap for completion of MVP that can be taken to customers for
further adoption.
• The company proration engine has been enhanced and adapted to
provide loyalty points based on fare paid by the passenger instead of milage travelled.
This creates a differentiator between customer low paying passenger and higher fare
passengers travelling in the same class.
Revenue Accounting - Accelya Managed Services
• Volume recovery continued with most of the AMS customer reaching
the pre COVID level volumes
• Major airline from Southeast Asia moved from Hosted to full AMS
service for Passenger Revenue Accounting
• Rigor back in the Customer Engagement Model with face to face
connect started with key customers after a gap of 3 years
Cost Management
The cost management business witnessed steady growth on the back of
airline volume recovery. The focus continued to remain on management of direct operating
expenses for customers in key categories such as fuel, ground handling.
ACCELYA SOLUTIONS STRENGTHS AND OPPORTUNITIES:
Business Focus, Expertise and Continuous Investment in Products and
Services
The Company continues to command a significant advantage in terms of
business domain knowledge and emerging industry changes. Years of experience have provided
the Company with a strong base of Intellectual Property and Intellectual Capital.
The Company continues to invest in Order Accounting platform to meet
the expected demand of airlines transitioning to One Order in future. The Revenue
Assurance solution is poised to move to a modernized web enabled solution..
Ready for the Evolving Airline Distribution Landscape
The Company is aligned with the upcoming industry changes with respect
to lATAs NDC and One Order initiatives. With Accelya US Incs proven solutions for NDC
and offer/order management, the Group (and the Company) can realize the vision of a new
airline platform spanning the entire lifecycle from offer to settlement and play a larger
role in the airline ecosystem. The Companys accounting solution is already certified by
IATA on new 21.3 standards as being NDC and One Order capable and is ready to handle the
distribution landscape of the future.
An expanding target market for Order Accounting
The addressable target market for the companys IATA certified Order
Accounting solution continues to expand as the solution is evolving with industry to
define and handle current and future business scenarios.
The solution is capable of transitioning customer towards adoption of
ONE Order Accounting requirements as well as meeting the accounting needs of LCC and any
other non-standard Airlines bookings. The Company is looking at leveraging these
capabilities to service airlines offering bundled services (air travel + holiday
packages), airlines with non-standard PSS as well as LCC and ultra LCC carriers. Moreover,
The Companys OA solution is OMS agnostic & capable of integrating all possible 3rd
party ancillary services, thereby giving it a clear edge over competitors.
Neutral Service Provider
Accelya Solutions is a neutral service provider and is not governed by
any competing airlines. The Companys platforms and processes are independent of any
airline strategic roadmap. Confidentiality and security of customer data are of utmost
importance to the Company.
Data Protection
The Company takes data privacy very seriously and has relevant controls
and compliances in place including PCI DSS 3.2 and ISO 27001: 2015. All of the Companys
products and services meet the new privacy standards as per the EU General Data Protection
Regulation (GDPR) regulations.
Single Vendor Accountability
Accelya Solutions has pioneered the concept of platform-based
outsourcing in the airline industry. The Company takes complete accountability of the
outcome as per the Service Level Agreements (SLAs).
It also takes the responsibility for maintaining and upgrading the
platform, processes and people skills in line with industry best practices and client
requirements.
Relationship with Customers
Accelya Solutions values long-term relationship with its customers. The
ability to forge effective and lasting partnerships with large, global airlines is the
Companys strength.
Accelyas relationship with its customers continues to go from strength
to strength. The company is also partnering with airlines to help them transition to the
One-order world & leverage new revenue earning opportunities in the post pandemic era.
Pay-as-you-use Model
Accelya Solutions offers its solutions on a pay-per-use model. It
enables airlines to have a low capex and variable costs. At the same time, this model
ensures the Company annuity revenue streams resulting in revenue visibility and foundation
for growth. A win-win for customers and the Company.
Financial Analysis Shareholders Funds
Shareholders funds decreased from ^ 25,633.42 lakhs to ^ 25,164.35
lakhs during the year 2022-23.
Equity
During the year, Share Capital, and Securities Premium stand at ^
1,492.69 lakhs and ^ 3,169.84 lakhs respectively. Presently, Accelya Solutions has
14,926,261 shares (Previous Year 14,926,261) of ^ 10 each fully paid up.
Profit and Loss Account
Accelya Solutions retained earnings as at June 30, 2023, amount to ^
18,014.92 lakhs.
As at 30th June 2023, Accelya Solutions book value per share decreased
to ^ 168.59 per share as compared to ^ 171.73 per share as at 30th June 2022.
General Reserves Account
During the year, general reserve stands at ^ 2,391.52 lakhs. There is
no change to this balance in the current year.
Capital Redemption Reserve
During the year, capital redemption reserve stands at ^ 95.38 lakhs.
There is no change to this balance in the current year.
Investment
Investments at cost, as at 30th June 2023 stands at ^ 4,741.15 lakhs.
There is no change to this balance in the current year.
Fixed Assets Product Development
During the year, product development cost amounting to ^ 304.13 lakhs
has been capitalised as an intangible asset. Other Fixed Assets
The Company added ^ 1,465.82 lakhs to the gross block comprising of ^
1,207.39 lakhs in plant and machinery, ^ 250.45 lakhs in purchase of software, ^ 3.80
lakhs in purchase of furniture and ^ 4.18 lakhs in purchase of leasehold improvements.
Sale / Disposal of Assets
During the year, the Company sold/ disposed of assets with a gross and
depreciated net value of ^ 3,069.89 lakhs. The sold assets included old plant &
machinery, furniture & fixtures, property at Pune (1st floor of Building Sharada
Arcade).
The Companys gross block as at June 30, 2023 stood at ^ 21,637.53
lakhs as compared to ^ 22,937.47 lakhs as at June 30, 2022. The corresponding net block as
at June 30, 2023 is ^ 4,411.18 lakhs as compared to ^ 5,445.48 lakhs as at June 30, 2022.
Trades Receivables
The Companys net receivables as at June 30, 2023 amounted to ^
8,632.32 lakhs as compared to ^ 7,697.11 lakhs as at June 30, 2022. These debtors are
considered good and realisable.
The need for provisions is assessed based on various factors including
collect ability of specific dues, risk perceptions of the industry in which the customer
operates and general economic factors which could affect the customers ability to settle
and finally depending on the managements perception of the risk. The total provision for
doubtful debts as at 30 June 2023 stands at ^ 9.21 lakhs compared to ^ 30.96 lakhs as at
30 June, 2022.
Trade receivables as a percentage of total revenue is 20.46% as at 30
June 2023 as against 22.43% as at 30 June, 2022. Non-current Liabilities
As at 30 June, 2023 the Companys non-current liabilities amount to ^
1,033.89 lakhs as compared to ^ 1,944.39 lakhs as at 30 June, 2022.
Current Liabilities
As at 30 June, 2023 the Companys current liabilities amount to ^
7,259.54 lakhs as compared to ^ 6,003.07 lakhs as at 30th June, 2022.
Result of Operations Sale of services
For the year ended 30th June 2023, the Company recorded operating
income of ^ 41,160.10 lakhs.
Operating Profit
The Company reported profit before exceptional items and tax of ^
14,676.97 lakhs for the year ended 30th June, 2023.
Profit after Tax (PAT)
The Company recorded PAT of ^ 11,850.58 lakhs for the year ended 30th
June 2023.
Dividend
The Company had declared and paid an interim dividend of ^ 35 per
equity share during the year.
IPR Assets and Amortisation
As a value innovator, the Company has always believed in developing its
own Intellectual Property (IP) and over the years has invested significant number of
resources in this development. All these products have been viewed as the best of the
breed products by the industry and highly appreciated by the customers.
Details of IPR assets and amortisation are as follows:
Product IPR |
Lakhs |
Opening Net Block |
2,185.19 |
Additions |
304.13 |
Amortisation |
875.91 |
Closing Net Block |
1,613.41 |
RISKS, CONCERNS AND RISK MITIGATION Increasing Competition
New providers and existing technology vendors are constantly foraying
into the airline IT and finance domain. Accelya Solutions is constantly investing in
people, solutions and processes to ensure maximum value to its customers. The companys
in-depth knowledge of the industry and its requirements makes it the partner of choice for
airlines.
Uncertain Economic Environment
The airline industry is amongst the first to be impacted by any major
economic or political situations. The Company is in a good position to mitigate this risk.
The Company has a global customer base. The company has long term contracts with its
customers which generates annuity revenues and provides good visibility on business.
Regulatory Risk
Proposed legislation in certain countries in which the Company
operates, may restrict airlines in those countries from outsourcing work to the Company,
or may limit its ability to send employees to certain client sites.
The Company has employees of different nationalities which helps in
mitigating this risk to a certain extent.
Cyber Security and Data Privacy Risk
Global cyber security and data privacy threats are ever increasing. The
Company has relevant controls and compliances in place to address these. The Companys
Privacy Management Program covers continuous risk analysis and mitigation for all its
products, services and processes.
Currency Volatility
Being a global organization dealing with global customers, volatility
in currency exchange movements may affect the results of Accelya Solutions operations.
The Company has currency hedging policies and practices in place which
are regularly reviewed to mitigate this risk. Resource Availability
The Company is in an industry driven by domain knowledge and
intellectual property and the Companys success depends in large part on its ability to
attract and retain talent.
Internal Financial Control Systems and their Adequacy
The Companys internal controls are commensurate with its size and the
nature of its operations. These have been designed to provide reasonable assurance with
regard to recording and providing reliable financial and operational information,
complying with applicable statutes, safeguarding assets from unauthorized use, executing
transactions with proper authorization and ensuring compliance with corporate policies.
The Company has a well-defined delegation of power with authority limits for approving
contracts as well as expenditure. Processes for formulating and reviewing annual and
long-term business plans have been laid down.
The Companys management assessed the effectiveness of internal control
over financial reporting (as defined in Clause 17 of SEBI Regulations 2015) as of June 30,
2023.
The Company has appointed Grant Thornton Bharat LLP to oversee and
carry out internal audit of its activities. The audit is based on an internal audit plan,
which is reviewed each year and approved by the audit committee. The conduct of internal
audit is oriented towards the review of internal controls and risks in the companys
operations such as operations and revenue review, accounting and finance, treasury
management, procurement, pre-sales & sales processes, statutory compliances, human
resource and cyber security & IT processes.
The audit committee reviews reports submitted by the management and
audit reports submitted by internal auditors and statutory auditors. Suggestions for
improvement are considered and the audit committee follows up on corrective action.
Based on its evaluation (as defined in section 177 of Companies Act
2013 and Clause 18 of SEBI Regulations 2015), the audit committee has concluded that, as
of June 30, 2023, the internal financial controls were adequate and operating effectively.
Human Capital
We value our employees and consider them as an asset to the
organization. In view of that, we have curate people centric policies that ensures high
performing culture, along with attractive workplace and become employer of choice. Our
objective is to have a collaborative, transparent and participative organization culture.
We continuously track human capital metrics to make sure we attract,
develop and retain the best talent. It is our endeavour to attract qualified talent...
Educational Qualifications
Post Graduates |
Engineering /Other
Graduates |
IATA Certified / Diploma
holders |
Undergraduates |
16% |
71% |
10% |
3% |
...With deep experience in our domain & technology...
Total Experience
Less than 2 years |
2-5 years |
5-10 years |
More than 10 years |
15% |
13% |
19% |
53% |
....and encourage practices of inclusion and diversity to bring forth
the best in our people....
Gender Diversity
...while making all efforts to retain the best people and enable them
grow in their roles
Attrition
Attrition for FY 22-23: 11.3% Voluntary attrition for last 3
years:
Year |
ITS |
BPO |
Others |
2023 (July 2022 to June 2023) |
14.1% |
9.3% |
15.9% |
2022 (July 2021 to June 2022) |
32.1% |
3.3% |
12.8% |
2021 (July 2020 to June 2021) |
17.6% |
4.0% |
10.6% |
Our employees are very important part of our success, and it is
essential to acknowledge the efforts made by our workforce. The past year presented
various challenges, but our commitment to the well-being and development of our employees
remained unwavering. As we move forward, we will continue to prioritise Human Capital
investments and strive for excellence in building a strong and sustainable organization.
As we evolve, our leadership responsibility has increased, and is
making leadership roles increasingly complex. Todays work environment requires leaders to
be more authentic, empathetic and adaptive. These three imperatives represent a new call
for leadership: "human" leadership.
To help leaders deliver on the need for human leadership and prepare
them for the future of work, recognize their humanity and directly address these emotional
barriers. Here are a few highlights from this past year:
Focus on Leadership:
• Leader shift and Leading Change Workshops
In our efforts to drive Accelyas Transformation and growth, we focused
on the design and implementation of Leader Shift and Leading Change Workshops for
our Top 40 and Next 200 Leaders. These workshops were focusing on developing
self-awareness and Top 40 responsibility to lead others to drive high performance in
Accelya, as well as positioning Next 200 People Leaders in a critical and central role in
driving the change and high-performance culture in Accelya.
o Regional workshops were planned between April 18 and July 25, with
strong executive involvement across all workshops in all regions.
o Feedback was encouraging.
• Leadership Development collections-We curated content for
on-line leadership development paths recommended for all employees part of the managerial
track who took the DDI assessments.
o Dedicated learning path for each segment of the Accelya Managerial
path. (Capitalizing on Linkedln Learning platform with self-paced courses recommended for
developing specific competencies - strengths and development areas identified within the
DDI assessments).
Learning
Introducing Linkedln and Plural sight Learning Platforms:
• Accelya is focusing on building a High-Performing and Learning
Culture. This strategic endeavour is sustained by offering all employees access to
valuable resources for them to invest their efforts and to expand their capabilities. The
organization is committed to their employees professional and personal development.
• With that aim we have partnered with Linkedln Learning and
Plural sight platforms which are an effective tool to support employees development with
self-paced learning paths to build critical skills that are key for individual, teams
success as well as business growth.
• These learning platforms offer the most relevant content
authored by industry experts in soft skill, behavioural & life skills, software
development, DevOps, security and many more. A consistent learning will help our employees
to produce work faster, ship better projects and come up with innovative ideas.
Accelya Academy
Continuous enablement and development of employees is essential to
improving organizational capability and performance. The Accelya Academy will develop
ennoblement programs and learning journeys that supports Accelya to achieve business
objectives by developing the skills and capabilities needed to deliver business results
and strategy, by supporting high performing talent, their career aspirations.
Accelya aspires for everyone to reach their full potential. Our
Enablement programs are designed to help our employees go further, faster, with the right
resources, tools and dedicated Certifications to support their growth. Accelya recognizes
that fully enabled employees are critical to the success of Accelya and its customers.
Accelya Academy will have a focus on the following areas (faculties)
• Product knowledge
• Skills and competencies:
• Leadership and Management
• Technical accreditation
• New Hire On boarding
• Sales ennoblement Communications / Engagement
With Accelyas global team spread across many locations, and the
changes in the Executive team, there was a strong need to improve the way we communicate
and connect with our employees. To do this effectively, we launched a new communication
strategy aimed at informing, creating transparency and enabling engagement.
• New initiatives launched as part of this strategy include
quarterly All-Employee Meetings, Top 40 Leaders meetings, next 200 Leaders meetings,
Coffee Connect sessions on initiatives / topics of interest and CEO video updates. All
sessions are interactive and give al employees to ask questions to the Executive Team as
part of the live events.
• The ONE Accelya Values award has also been launched, designed to
recognise those employees who demonstrate the Accelya Values in their day-to-day role.
This is a peer-to-peer nomination programme with 3 awards given per quarter.
Diversity, Equity & Inclusion
At Accelya we embrace diversity and equality in all aspects of our
business. We are committed to building a team with a variety of backgrounds, skills and
views - a place where every employee can be themselves so they can reach their full
potential and help us achieve our business skills.
The more inclusive we are, the better our work will be. This year the
focus has been on fostering an environment for inclusion, Unconscious Bias training for
managers and the implementation of a Womens Excellence in Accelya Employee Resource Group
(ERG). Membership of the ERG gives access to a mentoring program, defined learning
pathways for specific development areas, access to specialized events with guest speakers
and networking opportunities.
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