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NIIT Technologies consolidated results FY 2008-09

NIIT Technologies consolidated results FY 2008-09

  • Consolidated Revenues at Rs. 979.9 Crores, up 4% YoY
  • Revenue loss on account of crystallization of effective hedges Rs. 54.2 Crores
  • Operating Profit at Rs.176.4 Crores, preserved YoY
  • Profit After Tax at Rs. 114.8 Crores, down 15% YoY
  • Board recommends dividend of 65%

NIIT Technologies Limited, a leading IT solutions organization, announced its annual results for the year ended March 31, 2009, showing consolidated revenues of Rs.979.9 Crores, up 4% YoY from Rs. 941.5 Crores recorded last year. The company's hedge accounting policy based on Recognition & Measurement Principles' as enumerated per AS 30, for highly probable forecast transactions, has resulted in operating revenue being reduced by Rs. 54.2 Crores during the year due to the continuing weakening of the rupee against the dollar.

ANNUAL Performance at a Glance

 
 
 
Yr ended
Mar 31, 2008
Rs. Cr
Yr ended
Mar 31, 2009
Rs. Cr
Growth
YoY
Growth excluding hedging losses   YoY

Consolidated Revenues
941.5
979.9
4%
10%

Operating Profit
176.3
176.4
0%
31%

Operating Margins
18.7%
18.0%
(72)bps
358 bps

Profit After Tax
135.3
114.8
(15%)
 

 
The global economic climate during the year was characterized by extreme volatility and uncertainty.

“Despite the environmental challenges the company was able to consolidate business with improved order intake and absorb major portions of hedging losses by continuously improving cost structures during the year  to deliver a steady  operating margin of 18%.” said Mr. Arvind Thakur, CEO, NIIT Technologies Ltd.

Fresh order intake during the year was USD 312 Mn, an improvement of 36% over previous year. Revenue share from the US shrunk slightly to 31% on account of reduced revenues from hedging losses. Share of revenue from EMEA during this year remained at 50%, while rest of the world increased its share to 19% on stronger domestic demand in India. Growth in the BFSI segment remained muted at 1% during the year while business in the Travel and Transportation grew 16%, and revenue from Retail and Distribution grew 15%.

“Continuing its drive to specialize the company strengthened its position in select industry segments increasing revenue share from these segments to 84%. Further, growth in emerging non-linear business lines of Managed Services and IP-asset based solutions resulted in an increased revenue  share to 25% as planned”, said Rajendra S Pawar, Chairman, NIIT Technologies Ltd. 

The Board of Directors has recommended a dividend of Rs.6.5 per equity share.
NIIT Technologies Consolidated Quarter Results (Jan-Mar 2009)

  • Consolidated Revenues at Rs. 227.0 Crores, down 9% QoQ
  • Revenue loss on account of crystallization of effective hedges Rs. 22.1 Crores
  • Operating Margin at 18%
  • PAT at Rs. 26.3 Crores up 57% QoQ

NIIT Technologies reported revenues of Rs.227.0 Crores for the quarter ended March 31, 2009, a decrease of Rs.21.5 Crores recorded in the corresponding quarter last year. The rupee further depreciated during the quarter against the dollar resulting in reduction in revenue of Rs. 22.1 Crores due to crystallization of effective hedges.
 

JAN-MAR QUARTER Performance at a Glance

 
Qtr ended
Mar 31, 2008
Rs. Cr
Qtr ended
Mar 31, 2009
Rs. Cr
Growth
YoY
Growth excluding hedging losses   YoY

Consolidated Revenues
248.5
227.0
(9%)
0%

Operating Profit
46.7
40.4
(14%)
34%

Operating Margins
18.8
17.8
(102)bps
629 bps

Profit After Tax
31.0
26.3
(15%)
 

 
The global environment deteriorated dramatically in the second half of the FY 2008-09 with a significant impact in the last quarter. Major players in each industry segment experienced challenges on account of recessionary conditions impacting the IT industry as a whole.

“Top clients in our major industry segments cut back in their spending during the quarter. Our immediate response has been to step up marketing efforts to broad base clients and further improve cost structures to sustain operating margins” said Mr. Arvind Thakur, CEO, NIIT Technologies Ltd.

Operating Margin remained steady at 18%. Excluding the impact of hedging losses, operating margin for the quarter is computed at 25%.
 The Company enhanced its marketing efforts to strengthen its position by launching its next generation insurance processing framework (ipf3) for commercial insurance in US and India.
 Fresh order intake of USD 46 Mn were secured during the quarter which included addition of 5 new customers. Pending order booking executable over 12 months is USD 97 Mn.

"The economic crisis has resulted in discontinuities, leading to opportunities. Our initiatives in IP Platforms would transform the organization with enhanced specialization to explore these opportunities and compete effectively in these challenging times”  said Mr. Pawar 

The total number of people engaged at the end of the quarter under review was 4238.
Acknowledgements:

» NIIT Technologies ranked Number 1 in the Black Book of Outsourcing 2008 Travel Industry survey.
» NIIT Technologies ranked No. 3 amongst global  ITO service providers in the Black Book of Outsourcing 2008 Insurance industry Survey.
» NIIT Technologies ranked amongst the 2008 Black Book Top 50 Best Managed Outsourcing Vendors.
» NIIT Technologies declared 'Business Superbrand' for 2008 by the Superbrands Council of India.
» NIIT Technologies was awarded the Distinguished Services Award for their initiatives and efforts in promoting business with USA by Georgia Tech Center for    International    Business Education & Research.
» NIIT Technologies was felicitated with the Employer Branding Award for Excellence in HR through Technology and for Innovation in Career Development by the    Asia Pacific    HRM congress at the regional level.
» NIIT Technologies' subsidiary ROOM Solutions Ltd UK. conferred with an Accomplishment Award at the ACORD LOMA Insurance Systems Forum.
» NIIT Technologies was recognized amongst the top 50 IT Innovators for the year 2008 by NASSCOM.

» NIIT Technologies was amongst the Top 100 IT organizations ranked globally by IAOP. NIIT Technologies stands at 33rd overall and 7th in the Balanced    Performance.
» NIIT Technologies ranked amongst the Global Services 100 - 2009 list. The list represents companies who have the maturity and capability to lead the next wave    of services globalization.

About NIIT Technologies
NIIT Technologies is a leading IT solutions organization, servicing customers in North America, Europe, Asia and Australia. It offers services in Application Development and Maintenance, Enterprise Solutions including Managed Services and Business Process Management to organizations in the Financial Services, Travel, Retail and Distribution, and Government sectors. NIIT Technologies follows global standards of development, which includes ISO 9001:2000 certification, assessment at Level 5 of both SEI-CMMi version 1.2 and People-CMM frameworks and ISO 27001 information security management certification. Its data centre operations are assessed at the international ISO 20000 IT management standards.
For further information, please visit www.niit-tech.com
Safe Harbor

Certain statements in this release 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, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies / entities in which we have made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies 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
 

For media queries please contact:
Shweta Kaura
Corporate Communications
NIIT Technologies Ltd
+91 (11) 40570629
shweta.kaura@niit-tech.com

Jyotsna Nanda/Sudipta Das
Brodeur India
+91 98104 99625/9868314837
jnanda@brodeurindia.com
sdas@brodeurindia.com

For investor queries please contact:
K T S Anand
Chief Financial Officer
NIIT Technologies Ltd
+91 (11) 40570726
ktsanand@niit-tech.com
investors@niit-tech.com