Sify Technologies annual 07-08 Revenues at $150.59 Million

Sify Technologies Limited (Nasdaq Global Markets: SIFY), a leader in Consumer Internet and Enterprise Services in India with global delivery capabilities, announced today its consolidated results under the International Financial Reporting Standards (IFRS) for the year ended 31st March 2008.

Performance Highlights 2007/08:

Sify reported revenues of $ 150.59 million for the year ended 31st March 2008, 11.0% higher than the previous year ended 31st March 2007. The Enterprise and International segments of the business registered strong growth at 27% and 36% respectively, while the consumer segment dropped 20% over the previous year.

Net profit for the year was $ 0.12 million compared to a net profit of $6.25 million in the previous fiscal year. Net profit for the current year included one-time benefit of $ 3.1 million on account of a change in the depreciation policy. Net profit for the year was under pressure due to lower margins due the sales mix, as well as a notional loss incurred on account of the strong rupee against dollar.

Exceptional items during the year amounted $ 3.97 million on account of legal fees. Net Profit excluding this amount was $4.09 million.

Sify ended the quarter with a cash balance of $ 22.21 million after capital expenditures of $ 20.58 million during the Year. This will be augmented with the infusion of $57 million dollars, which is currently under process.

 

Mr. Raju Vegesna, Board Chairman and CEO & MD, Sify Technologies, said, "The turnaround of the enterprise and international segments has resulted in robust growth in these businesses. We expect the results of our restructuring of the consumer businesses to be felt in the current financial year after the second quarter. Preparations are already underway for the re-launch of our chain of retail outlets offering online services with a new brand name, as well as our broadband services. The portal will follow towards the middle of this financial year. During the year we have expanded our network aggressively and now have one of the largest MPLS data networks in the country. We will also have 200,000 square feet of data center space with the launch of the second data center in Mumbai in the near future, in addition to our three existing data centers. Our planned progress towards a complete turnaround of the company is moving forward with the build out of world class infrastructure to make us highly competitive both nationally and internationally."

Mr CVS Suri, Chief Operating Officer, Sify, said, "The results of our restructuring the enterprise side of the business are clearly evident. We are now ready to re-launch the consumer side of the business during the course of 08/09 with new brands, new formats, new technologies and new alliances. Our aim will be to make the Internet the personal productivity tool for Indians with access both from home and from public spaces. We are confident that with the re-launch and awareness of these services, we will be able to see a turn-around in consumer revenues as well. At the same time, we will monitor and rationalize our offerings, locations and relationships on an ongoing basis to ensure the success of our partners."

Mr. MP Vijay Kumar, Sify CFO, said, "We have moved to reporting our financials as per IFRS as our businesses are increasingly becoming global. Indian GAAP is also converging with IFRS in future so this is a timely move for us. We have invested substantially during the year on network expansion and data center space. We will continue to invest in both this coming year, as well as in building Sify's head quarters in Chennai with sophisticated network command centers and additional data center space. This will entail an investment of about $125 million, including the current expansion. These investments are being made on the back of robust demand for enterprise services across both connectivity and hosting services. We will also invest in re-launching our consumer businesses during the year to set them on a growth trajectory."

Highlights of the businesses:

Sify Enterprise:

Sify Enterprise revenues grew 27 % over the previous financial year

The fourth quarter registered the highest order booking ever at $18.14 million during the quarter. Orders were received for all our services across connectivity, hosting, security, applications and voice services.

Applications services grew by over 80% during the last quarter, while our Document Management Systems clocked a growth of 126% over the previous quarter.

Significant wins were a large order for the phase two of VMWare's hosting requirements. In all the hosting order booking grew by 93% during the fourth quarter.

We strengthened our relationship with Tata Motors by securing another order from them for security solutions.

During the last quarter, the Microsoft Hosted Messaging Center was launched as a Software as a Service (SaaS) initiative.

Sify International:

Sify's international services grew at 36% over the previous year.

Sify IMS:

Achieved "Cisco Global PSS Partner" status. As one of Cisco's global partners, we are already delivering System Integration services to Cisco's global customers.

Sify has been selected by Spend Management Solutions provider in the US, and are delivering Remote Infrastructure Management Services for this company.

Sify eLearning:

Awarded new contracts worth over US 0.5 Million by customers in Hi-Tech domains.

Added new products and services such as Virtual Learning Environments, Mobile Learning, 3D VRML Viewer, & Job Task Analysis to the portfolio. These products and services would develop into attractive revenue streams in the coming years.

Sify Consumer:

The planning, strategy and alliances for the consumer business is now largely in place for the re-launch of this business going forward to initiate growth in revenues and users.

Based on research with consumers during the last quarter, the iWay cyber caf