MphasiS Sequential Quarter Revenues up 10% and Profits up 27%, Dividend at Rs 3 per share

The MphasiS Group consolidated net profit increased to Rs 45.6 crores for the quarter ended 31 March 2007, compared to a net profit of Rs 35.8 crores in the quarter ended 31 December 2006, representing an increase of 27%. Revenue growth in sequential quarters was a healthy 10% from Rs 306 crores in the quarter ended 31 December 2006 to Rs 337 crores in the quarter ended 31 March 2007, despite a strong appreciation in the Indian Rupee vis-à-vis the US Dollar.

Consolidated revenues at Rs 337 crores in the current quarter have increased by 35% over the same quarter last year. During the same period net profit increased by 30% from Rs 35.2 crores to Rs 45.6 crores. This despite a forex loss of Rs 2.6 crores in the quarter ended 31 March 2007 as against forex gain of Rs 1.2 crores in the quarter ended 31 March 2006.

For the year ended 31 March 2007 the Group recorded revenues of Rs 1,196 crores a growth of 27% over the previous year. While operating profits for the year 2006-07 remained almost flat over the previous year, forex losses of Rs 12.5 crores and a tax charge of Rs. 13.6 crores during the year as compared to forex gains of Rs 8.5 crores and a lower tax charge of Rs 5.8 crores contributed to a reduction in net profit by 20% from Rs 150 crores during the previous year to Rs 120 crores during the year ended 31 March 2007. Pending approval of the high court of Karnataka of the merger between EDS India and MphasiS, the above numbers are for MphasiS only. During the year ended 31 March 2007 EDS India recorded (unaudited) revenues and net profits of approximately Rs 570 crores and Rs 59 crores respectively.

The Board of Directors has recommended a final dividend of Rs. 3.00 per share for the year 2006-07 maintaining the payout from last year.

Commenting on the results Mr. Jerry Rao, Chairman, said "This fiscal has been one of great challenges and achievements. We have grown from strength to strength after a subdued first quarter to record our highest ever profits as a Company. As a combined group with EDS India we have crossed 20,000 people and are looking at building on this solid foundation in the time to come."

During the quarter the Group added seven new clients, six in application services and one in BPO. These include a US based housing finance institution, an entertainment & animation company, a south east asian reinsurance company in the software services business and a large US based investment bank in BPO. This does not include the dozen relationships added through EDS nor the internal working being done for the parent company.

This quarter the Group recorded a headcount increase of 957 in application services and 1,003 in BPO to take the manpower numbers to 5,194 and 9,485 in BPO for a Group total of 14,679. This does not include the employees of EDS India.

Overall debtors days have remained steady at 58 days and the Group had a healthy cash reserve of Rs 123 crores as at 31 March 2007.Billing rates in application services remained steady at $67 per hour onsite and $22 per hour offshore while BPO rates improved to $10 per hour thanks to the increased share of knowledge process outsourcing services being carried out.

Source : Equity Bulls

Keywords