Quess Corp overseas EBITDA rises despite quarterly revenue fall

Quess Corp Limited increased overseas EBITDA even as quarterly revenue declined in Q2 FY27: earnings before interest, tax, depreciation and amortisation rose 23% year on year to Rs 22 crore, while revenue fell 4% sequentially to Rs 318 crore. Quess Corp attributed flat Middle East revenue to geopolitical issues, while the Philippines and Malaysia recorded year-on-year growth.

Why did Quess Corp overseas revenue decline in Q2 FY27?

Quess Corp’s overseas revenue fell because Middle East revenue was flat amid geopolitical issues, according to management, taking total revenue down 4% quarter on quarter from Rs 333 crore in Q1 FY27 to Rs 318 crore in Q2 FY27. This was the first sequential decline in the five-quarter series after revenue increased from Rs 290 crore in Q3 FY26 to Rs 332 crore in Q4 FY26 and Rs 333 crore in Q1 FY27.

The sequential reduction did not reverse the annual revenue increase. Q2 FY27 overseas revenue of Rs 318 crore was 10% above Rs 290 crore in Q2 FY26. Management also reported 33 new contracts during Q2 FY27 and said overseas revenue and EBITDA delivered double-digit year-on-year growth.

Middle East revenue represented 22% of Quess Corp’s overseas total in Q2 FY27, down one percentage point from 23% in Q1 FY27. Singapore remained the largest revenue region at 49%, versus 50% in the preceding quarter, while the rest of world, or ROW, increased its share to 29% from 27%. These mix movements coincided with the Rs 15 crore quarterly revenue decrease.

How did Quess Corp overseas profitability change?

Quess Corp’s overseas EBITDA rose by Rs 1 crore sequentially and Rs 4 crore year on year to Rs 22 crore in Q2 FY27, despite the revenue decline. The Q2 FY27 EBITDA margin increased to 6.9% from 6.2% in Q1 FY27 and Q2 FY26. Management said margins remained stable despite currency fluctuations, while the reported margin improved by 0.7 percentage points from the prior quarter.

The year-on-year comparison was more pronounced than the sequential movement. Revenue increased by Rs 28 crore from Rs 290 crore in Q2 FY26 to Rs 318 crore in Q2 FY27, while EBITDA increased from Rs 18 crore to Rs 22 crore. The presentation reports 10% year-on-year revenue growth and 23% EBITDA growth.

Middle East operations delivered a 14.2% margin in Q2 FY27, above the overall overseas EBITDA margin of 6.9%. The region accounted for 45% of overseas EBITDA in Q2 FY27, up from 44% in Q1 FY27, even though it generated 22% of revenue. The disclosed mix shows that the Middle East remained a larger contributor to EBITDA than to revenue.

Which overseas regions contributed most to Quess Corp revenue and EBITDA?

Singapore was Quess Corp’s largest overseas revenue contributor in Q2 FY27, representing 49% of revenue, while the Middle East was the largest EBITDA contributor at 45%. Singapore’s revenue share eased from 50% in Q1 FY27, and its EBITDA share declined from 36% to 35%. Singapore General Staffing added eight contracts and 59 local headcount during the quarter.

ROW increased its share of overseas revenue to 29% in Q2 FY27 from 27% in Q1 FY27, while its EBITDA share rose to 21% from 20%. Its headcount share also increased to 44% from 43%. The presentation does not provide separate revenue or EBITDA amounts for ROW, so the disclosed figures establish mix changes rather than country-level monetary contributions.

The Middle East’s headcount share decreased to 36% in Q2 FY27 from 37% in Q1 FY27 and 40% in Q4 FY26. Yet its EBITDA share rose to 45% from 44% sequentially and matched the 44% share reported in Q2 FY26 only after increasing by one percentage point. Singapore had 20% of overseas headcount but 49% of revenue in Q2 FY27, whereas ROW had 44% of headcount and 29% of revenue, illustrating different regional operating mixes.

How did Quess Corp perform in the Philippines and Malaysia?

The Philippines recorded 15% year-on-year revenue growth in Q2 FY27 and a 10.5% net margin, according to Quess Corp. The presentation identified the Philippine result separately from the overall overseas EBITDA margin of 6.9%. It did not disclose Philippine revenue in rupees or its contribution to ROW revenue.

Malaysia delivered 50% year-on-year revenue growth in Q2 FY27, the fastest country growth rate specifically disclosed for the overseas business. Management said Malaysia had a lower margin profile, without publishing a Malaysian margin percentage or revenue amount. The result therefore provides growth within the overseas portfolio but does not establish Malaysia’s absolute profit contribution.

The Philippines’ 15% revenue growth and Malaysia’s 50% growth contrast with the Middle East, where revenue was flat because of geopolitical issues. Quess Corp also reported 33 contracts added across overseas operations in Q2 FY27, including the eight Singapore General Staffing contracts. The presentation does not assign the remaining 25 contracts to the Middle East, Philippines, Malaysia or other markets.

Conclusion

Quess Corp’s Q2 FY27 overseas performance combined lower sequential revenue with higher EBITDA: revenue declined to Rs 318 crore from Rs 333 crore, while EBITDA increased to Rs 22 crore and margin reached 6.9%. Flat Middle East revenue constrained the quarter, but the Middle East’s 14.2% margin, the Philippines’ 10.5% net margin and growth in the Philippines and Malaysia supported profitability across the overseas portfolio.

The next disclosed matters to watch are whether geopolitical issues continue to keep Middle East revenue flat and whether Malaysia maintains its 50% year-on-year growth despite its lower margin profile. Singapore’s eight new contracts and 59 local headcount, alongside the 33 overseas contracts added in Q2 FY27, are also relevant to whether revenue mix changes from the Q2 FY27 split of 49% Singapore, 22% Middle East and 29% ROW.