Genpact posts 4% rise in Q2 profit;lowers 2016 revenue outlook

BPO major Genpact reported about 4 per cent jump in net profit at USD 65.2 million for the second quarter ended June 30, 2016.
The US-based firm, which follows January-December fiscal, had posted a net profit of USD 62.7 million in the same period last year, it said in a statement.
Its revenues rose 3 per cent to USD 630.5 million in the April-June quarter of 2016 from USD 609.5 million in the year-ago period.
Genpact has lowered its revenue guidance for the current fiscal in the range of USD 2.59 - 2.62 billion, representing a growth range of 5-6 per cent or 7-8 per cent on a constant currency basis.

This includes an assumed adverse foreign exchange impact of USD 41 million, almost all of which is reflected in global client revenue.
The company had earlier forecast its revenue for 2016 to be in the range of USD 2.62-2.66 billion, representing a constant currency growth range of 8-10 per cent.

"Genpact delivered steady second quarter results in an uncertain macro environment. Our Global Client BPO business continued to deliver strong performance," Genpact President and CEO N V Tyagarajan said.
He added that "challenging business conditions" in the investment banking and healthcare industries have led to cuts in discretionary IT spending that weighed upon its global client IT revenue in the second quarter and will impact its topline outlook for the full year.

Revenue from global clients stood at USD 521 million, up 5 per cent year-on-year, representing about 83 per cent of total revenues.
Revenue from GE was USD 109 million, down 5 per cent y-o-y, representing approximately 17 per cent of total revenues.
Total BPO revenue was USD 508 million, up 6 per cent y-o-y, representing about 81 per cent of total revenues.
Cash from operations stood at USD 91 million in the second quarter of 2016, up 1 per cent from USD 90 million in the corresponding period of 2015.
For the 12-month period ended June 30, 2016, the number of client relationships generating annual revenue over USD 5 million increased to 104 from 102 as of June 30, 2015.

Genpact's employee attrition rate for the quarter was approximately 26 per cent, measured from the first day of employment, down from 29 per cent for the same period in 2015.