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MindTree net dips 72 percent in first quarter

Bangalore, July 19 (IANS) Global IT solutions firm MindTree Monday reported consolidated net profit of Rs.16 crore for the first quarter (April-June) of this fiscal (2010-11), registering a sharp decline of 72 percent from the like period of previous fiscal (2009-10), as per the Indian accounting standard.

In a regulatory filing, the Bangalore-based firm said consolidated revenue, however, grew 14 percent year-on-year (YoY) to Rs.349 crore in rupee terms.

In dollar terms, consolidated net income declined 70 percent YoY to $3.5 million though revenue grew 24 percent YoY to $77 million.

Sequentially too, consolidated net profit declined 71 percent YoY though revenue grew 1.3 percent YoY in rupee terms from previous quarter (Jan-April) of last fiscal (FY 2010).

In dollar terms, net dipped 70 percent YoY while revenue increased 24 percent YoY.

On standalone basis, though net profit declined 24 percent YoY to Rs.42 crore, revenue grew 14 percent YoY to Rs.329 crore in rupee terms, while in dollar terms, net income dipped 20 percent YoY to $9.3 million but revenue grew 17 percent YoY to $73 million.

‘Higher wage bill, investment in product business and lower billing rates from customers had a cascading impact on our operating margins, which declined to 15 percent from 19 percent YoY,’ MindTree chief financial officer Rostow Ravanan told reporters in a conference call.

MindTree chief executive Krishnakumar Natarajan, however, maintained that the first quarter was encouraging in terms of revenue traction, setting a strong foundation for good growth during this fiscal.

‘As a customer and people centric organisation, we are confident of enhancing business in the current volatile environment,’ Natarajan added.

The company added 31 customers during the quarter under review, taking the total number of active clients to 261, including 39 Global Fortune 500 firms.

During the quarter under review (Q1), the company bagged a contract from the Indian government to provide application development, maintenance and support services to the Unique Identificaiton project ‘Aadhar’.

Similarly, the company signed a multi-year infrastructure management partnership with a large US-based private firm and won multi-year deals with a large information and communication technology (ICT) firm in Europe to provide infrastructure management services and application maintenance support to a global banking and financial services conglomerate based in Britain.

— Indo-Asian News Service

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