Satyam net up 25%, co cuts revenue guidance
By TNN |
Highlights
HYDERABAD: Satyam Computer Services has clocked a 25% growth in net profit to Rs 337.2 crore, excluding other income, during the quarter ended December 31, 2006, as against Rs 269.7 crore in the same period of the previous year, according to consolidated Indian GAAP figures.
Taken sequentially, the third quarter net profit is 5.45% higher compared with the corresponding quarter of the previous year. The company has also clipped its revenue guidance for 2006-07, under Indian GAAP, to a growth of between 34.3% and 34.4% in view of rupee appreciation.
In the previous quarter, the company had, in fact, raised the revenue guidance up to 35.1% or Rs 6,476 crore for 2006-07. Total income in the third quarter at Rs 1,661.12 crore was up 31.3% over the corresponding period of the previous fiscal. As compared with Q2, the total income was up 3.7% during the quarter ended December 2006. The Q3 revenue is also lower than the company���s guidance of Rs 1,666 crore to Rs 1,674 crore for the period.
Satyam chairman B Ramalinga Raju said that the focus on offshore contracts has improved margins in this quarter. ���For the past eight quarters, the offshoring component has gone up from 43% to 49%. We will focus on increasing offshoring in the future,��� Mr Raju said.
The company added 2,746 new employees during the quarter, taking the total strength to 34,405 with 25,007 employees offshore. Satyam has also reported a 205 basis points improvement in its EBITDA margins despite the negative impact of 120 bps on margins on account of a 3.7% rupee appreciation.
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���The EPS of Rs 5.14 is higher than the guidance of Rs 5.11 in spite of Rs 35 crore forex loss,��� Satyam CFO V Srinivas said. However, the markets did not seem impressed as the Satyam stock fell by 5.3% to close at Rs 487.7 on the BSE on Friday. The company is actively looking at closing the fiscal with a couple of large acquisitions. ���We will close one or two deals in the next two months. These are large deals costing over $100-200 million. We will look at winning deals without compromising on margins,��� said Mr Raju.
On the acquisition of Satyam by a global IT firm, Mr Raju said, ���We are not looking at selling out. The company is in a juncture where we are looking at adding new companies into our fold. We will continue to focus on expanding our business globally.���
The revenue guidance for Nipuna, the BPO arm of Satyam, for the fiscal has been revised from $36 million to $37 million, which would mean a 87% growth over the previous year.
The enterprise value of Nipuna has also been revised from $140 million to $180 million. Satyam will complete the acquisition of the remaining stake in Nipuna by the first quarter of 2007-08 with a payment of $35 million-$40 million to the investors.
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