MphasiS BFL net down 42% on forex loss

BS 200 SCORECARD

MphasiS BFL has posted 42 per cent dip in net profit for the second quarter ended September 2006 at Rs 23.3 crore vis-a-vis the comparable figure of the previous financial year.

The company's total income rose 23 per cent to Rs 285 crore from Rs 230.2 crore for the quarter ended September 30, 2005.

MphasiS BFL attributed the drop in net profit to a forex loss of Rs 6.9 crore and a tax charge of Rs 3.9 crore in the September 2006 quarter against a forex gain of Rs 4 crore and a tax charge of Rs 0.9 crore in the same quarter of 2005-06.

This also includes a provision for staff retention, which will continue over the next five quarters.

Commenting on the results, Jerry Rao, CEO and chairman designate, said, "We have crossed the Rs 500 crore mark in revenues in the first six months this year. We have added more than 1,300 people this quarter to take our headcount past the 12,000 mark. While y-o-y revenue growth is back on track, we are still some ways from getting back to historical margin trajectories."

"Business from EDS has started flowing and the integration with EDS India is progressing well," he added.

On a sequential quarter basis, net profit surged 54 per cent, while the operating profit for the quarter almost doubled to Rs 32.8 crore from the previous sequential quarter ended June 30, 2006.

During the second quarter of FY07, the group added 11 new clients, 10 in software services and one in BPO.

This quarter, the utilisation rates in IT Services recorded an improvement to 74 per cent; BPO utilisation was flat at 56 per cent.

In the same period, the group registered a headcount increase of 418 in software services and 883 in BPO to take the manpower to 4,088 and 8,447 people, respectively, for a group total of 12,535 reflecting a n rise of over 3,000 in the last 12 months.

On October 19, EDS, which holds around 51 per cent in MphasiS BFL, had made public its intention to make a voluntary open offer for approximately 32.95 million shares of MphasiS BFL.

The offer is slated to open on November 27 and close on December 18. If this offer sails through, EDS will hold around 71 per cent stake and will further hike this to around 77 per cent post-merger between EDS India and MphasiS.