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Source : Patni Computer Systems Patni’s Q2’CY2008 Revenues at US$ 182.6 million up 11.8% YoY Mumbai, Maharashtra, India -- (Business Wire India) -- Thursday, July 24, 2008 11:05:00 AM Performance Highlights for the quarter ended June 30, 2008 -- Revenues for the quarter at US$ 182.6 million (Rs. 7,837.1 million) - Up 11.8% YoY from US$ 163.3 million (Rs. 6,628.1 million) - Up 3.5% sequentially from US$ 176.4 million (Rs. 7,061.2 million) - Contribution from top customer at 10.4% for the quarter from 11.1% during the previous quarter -- Operating Income for the quarter at US$ 16.8 million (Rs. 720.7 million) - Down 48.1% YoY from US$ 32.4 million (Rs. 1,313.5 million) - Down 3.1% sequentially from US$ 17.3 million (Rs. 693.4 million) -- Net Income for the quarter at US$ 24.2 million (Rs. 1,037.2 million) - Down 27.2% YoY from US$ 33.2 million (Rs. 1,347.6 million) - Up 33.4% sequentially from US$ 18.1 million (Rs. 724.6 million) -- EPS for the quarter at US$ 0.17 per share (US$ 0.35 per ADS) -- Stock Buy Back execution started as of July 10th 2008. -- Stock based expenses in Q2 CY2008 were at US$ 1.0 million compared to US$ 1.1 million in the previous sequential quarter Future Outlook: -- Q3 CY2008 revenues are expected to be at US$ 182 to US$ 183 million and net income (excluding the foreign exchange gain/loss) is expected to be in the range of US$ 18.0 to US$ 18.5 million taking the operations at a constant dollar value of Rs 42 per US$ for the quarter. Management Comments Commenting on the quarter, Mr. Narendra K Patni, Chairman and CEO, Patni Computer Systems Ltd., said, “While our revenues and margins were in line with guidance the overall market environment remains challenging with prevailing global uncertainties. We are cautious in our short term outlook but remain positive on long term prospects of our business and are continuing our investments in identified areas” The newly appointed Executive Director Mr. Loek van den Boog, said, “ The global information technology services industry is going through a significant change. We have proactively identified key strategic areas for differentiated investment and focus which we believe will act as growth drivers and enable long-term, sustainable and profitable growth. We have also made corporate and operating management changes to strengthen the execution of all spheres of our business and I am very confident that these will yield the desired results ” Speaking on the occasion, Mr. Surjeet Singh, Chief Financial and Operations Officer said, “ The overall growth visibility is low in light of continued market uncertainties in various segments of our business specially in North America. The currency movement was volatile during the quarter but we managed our risks well through our hedging operations. We continue to make investments in geographical expansion in Europe and emerging markets to diversify our revenue portfolio besides continuing to invest to strengthen our services and portfolio” Corporate Developments -- Corporate Management Changes - Mr. Surjeet Singh, previously CFO, has been promoted as Chief Financial and Operations Officer He will also now manage global operations and infrastructure in addition to finance and internal systems. - Mr. Neeraj Gupta , previously EVP -Communications and Media business, has been appointed as Chief Commercial Officer and Head of Global Client Relations responsible for global sales and marketing across geographies and vertical markets. -- Awards - Patni has won the ‘Economic times – Smart Workplace Awards’ under the “Professional Services” category. The award is designed to recognize and celebrate organization that are ‘Smart’ i.e. who adopt the best technological and HR practices. Financial Statements Analysis: Revenues Revenues during the quarter were marginally ahead of guidance at US$ 182.6 million (Rs.7,837.1 million), representing a sequential increase of 3.5% and 11.8% increase on YoY basis in US dollar terms. We are focusing on EMEA region and our share of Europe and Middle East business has increased to 18.7% from 16.2% in Q2’07. Gross Margin Gross Margins were at 30.3% or US$ 55.4 million (Rs.2,377.5 million) against 28.7% or US$ 50.6 million (Rs.2,024.7 million) in the previous quarter with positive operating impact of 1.7% due to Rupee depreciation , positive impact of 1% due to improvements in utilization and negative impact of ~2% due to compensation increase -- Depreciation and amortization expenses in CGS were US$ 5.0 million against US$ 5.4 million in Q1 2008 and US$ 4.7 million in Q2 2007. Selling General and Administrative Expenses (SGA Expenses) -- Sales and marketing expenses during the quarter were at US$ 13.8 million (Rs. 593.2 million) at 7.6% as compared to US$ 12.3 million (Rs. 494.1 million) at 7.0% in the previous quarter(period cost change) -- G&A expenses during the quarter were at US$ 19.8 million (Rs.852.0 million) at 10.9% as compared to US$ 18.7 million (Rs.748.7 million) at 10.6% in the previous quarter. -- Overall Depreciation and Amortization expenses in SGA were US$ 2.1 million for the quarter as against US$ 2.0 million in Q1 2008. Foreign exchange gain/loss The revaluation and mark to market foreign exchange loss for the quarter US$ 4.7 million (Rs. 201.6 million) as compared to foreign exchange loss of US$ 2.2 million (Rs.89.0 million) in the previous quarter. The quarter end rate for debtor’s revaluation was Rs.43.02.Outstanding contracts at the end of Q208 were about US$ 395.5 million contracted in the range of Rs.39.77 to Rs.44.10. Other Income For Q2 CY2008, other income (including interest and dividend income net of interest expenses, profit/loss on sale of investments and other miscellaneous income) stood at 6.2% or US$ 11.3 million (Rs.486.2 million ) as compared to 2.1% or US$ 3.7 million (Rs. 148.4 million) in the previous quarter. Profit before Tax PBT was up 33.7% sequentially at US$ 28.1 million (Rs. 1,206.9 million) against US$ 21.0 million (Rs. 841.8 million) in the previous quarter mainly due to rupee depreciation and other income Income Taxes Income tax for the quarter was at US$ 4.0 million (Rs. 169.7 million) at an effective tax rate of 14.1%. Net Income Consequently, net income for the quarter at 13.2% was US$ 24.2 million (Rs.1,037.2 million) against US$ 18.1 million (Rs.724.6 million) at 10.3% in the previous quarter. Balance Sheet and Cash Flow changes During the quarter, against net income of US$ 24.2 million (Rs.1,037.2 million), cash from operating activities was at US$ 55.0 million (Rs. 2,359.3 million) net of changes in current assets and liabilities of US$ 35.8 million and non cash income of US$ 5.0 million. These non cash charges comprise of depreciation and amortization of US$ 7.0 million, and other charges including stock option cost and gain on sale of securities of US$(-) 12.0 million. Net cash from investing activities was US$ 31.8 million (Rs.1,365.2 million) including capital expenditure of US$ 13.0 million (Rs.560.2 million),net proceeds from sale of investments of US$ 18.8 million (Rs. 805.0 million) Net Cash outflow on financing activities was US$ 0.1 million (Rs.3.0 million) comprising of other financing activities. Over all cash and cash equivalents (including short term investments) were at US$ 343.9 million (Rs.14,762.8 million),compared to US$ 326.1 million (Rs.13,050.7 million) at close of Q1 2008. Receivables at the end of Q2 2008 were at US$ 116.5 million as compared to US$ 136.8 million at the end of Q1 2008. Number of days outstanding (Including Unbilled) for the current quarter were 89 days as compared to 95 days in Q1 2008. Important Notes to this release: -- Fiscal Year Patni follows a January – December fiscal year. The current review covers the financial and operating performance of the Company for the second quarter ended 30th June 2008 -- U.S. GAAP A Consolidated Statement of Income in US GAAP is available on page 3 of the Fact Sheet attached to this release -- Percentage analysis Any percentage amounts, as set forth in this release, unless otherwise indicated, have been calculated on the basis of the U.S. Dollar amounts derived from our consolidated financial statements prepared in accordance with U.S. GAAP, and not on the basis of any translated Rupee amount. Calculation of percentage amounts on the basis of Rupee amounts may lead to results that are different, in a material way, from those calculated as per U.S. Dollar amounts. -- Convenience translation A Consolidated Statement of Income as per Convenience Translation prepared in accordance with US GAAP is available on page 8 of the Fact Sheet attached to this release. We have translated the financial data derived from our consolidated financial statements prepared in accordance with U.S. GAAP for each period at the noon buying rate in the City of New York on the last business day of such period for cable transfers in Rupees as certified for customs purposes by the Federal Reserve Bank of New York. The translations should not be considered as a representation that such US Dollar amounts have been, could have been or could be converted into Rupees at any particular rate, the rate stated elsewhere in this document, or at all. Investors are cautioned to not rely on such translated amounts. -- Attached Fact Sheet (results & analysis tables) About Patni Computer Systems Ltd: Patni Computer Systems Limited (BSE: PATNI COMPUT, NSE: PATNI, NYSE: PTI) is a global provider of IT Services and business solutions, servicing Global 2000 clients. Patni caters to its clients through its industry focused practices, including insurance, financial services, manufacturing, life sciences, telecommunications and media & entertainment, and its technology-focused practices. With an employee strength of over 15,000; multiple global delivery centres spread across 11 cities worldwide; 22 international offices across the Americas, Europe and Asia-Pacific; Patni has registered revenues of US$ 663 million for the year 2007. Patni’s service offerings include application development and maintenance, enterprise application solutions, business and technology consulting, product engineering services, infrastructure management services, customer interaction services & business process outsourcing, quality assurance and engineering services. Committed to quality, Patni adds value to its client's businesses through well-established and structured methodologies, tools and techniques. Patni is an ISO 9001: 2000 certified and SEI-CMMI Level 5 (V 1.2) organization, assessed enterprise wide at P-CMM Level 3. In keeping with its focus on continuous process improvements, Patni adopts Six Sigma practices as an integral part of its quality and process frameworks. For more information on Patni, visit www.patni.com. IMPORTANT NOTE: Certain statements in this release concerning our future growth prospects are forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT services including those factors which may affect our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, liability for damages on our service contracts, the success of the companies in which Patni has made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. The company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the Company. To view the fact sheet, tables and press release, please click on the links given below: Fact Sheet Press Release with Tables Media Contact Details Gaurav Agarwal, Investor Relations, Patni US, +1-617-914-8360, investors@patni.com Gavin Desa, Investor Relations, Citigate Dewe Rogerson India, +91-22-4007 5037, gavin@cdr-india.com Heena Kanal, Media Relations, Patni India, +91 (022) 6693 0500, heena.kanal@patni.com Tony Viola, Media Relations, Patni US, +1-617-354-7424, tony.viola@patni.com For pictures or documents illustrating this release click below: Fact_Sheet_Q208(1).xls Patni Q2_2008_press releasev2.doc Submit your press release at http://www.businesswireindia.com Disclaimer |
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