| Infosys Q3 net up 25%, top-line grew 17% |
| BS Reporter / Bangalore January 11, 2008 |
| Bangalore-based India's second largest software exporter, Infosys Technologies, historically has a seasonally-weak third quarter. This third quarter was no different. Though the company registered a net profit (Indian GAAP) of Rs 1,231 crore for the third quarter ending December 31, 2007 - 25% increase when compared to the figure of the corresponding quarter last financial year - the figure included a reversal of tax provision of Rs 50 crore. The company' share price lost 1.38% to touch Rs 1580.10 on the Bombay Stock Exchange. The top-line (year-on-year) rose by 17% to reach Rs 4,271 crore. However, on a sequential (compared to the trailing quarter) basis, the revenue increased by a mere 4%. The figure was lower that analyst expectations of a 5-6% top-line growth. The company's sequential net profit, on the other hand, rose by 12%. However, excluding the tax write-back, it grew by 7.4%. On the other hand, the growth in dollar terms (US GAAP) was decent at 6.1%. Volume growth, aided by price increases proved to be the key driver of the top-line. Infosys managed to surprise the market with its EBITDA (operating profit) margin expanding by 1.3% sequentially to 32.6%, led by an increase in offshoring and fixed priced contracts, coupled with scale benefits that resulted in reducing the selling, general and administration (SG&A) expenses. Offshore revenues increased from 51.2% in the trailing quarter to 52.2% in the third quarter. The contribution of revenues from fixed price contracts also increased from 29.8% in the second quarter to 32.8% in Q3. Offshore billing rates saw a rise of 1.3%, while onsite rates grew by 1.1% sequentially. Meanwhile, the earnings per share (EPS) increased to Rs 21.54 from Rs 17.64 for the corresponding quarter in the previous year. The other income was Rs 158 crore as against Rs 154 crore in the second quarter of FY 2008. Infosys has guided towards a growth of 4.8 |
