Birlasoft (BSOFT) Q4 00/01 earnings summary

Executive summary

• Nine-month FY 2000-01 marked a turnaround: revenue was Rs 392.11m and net profit Rs 34.10m, versus a Rs 8.55m loss in the prior 12-month period; annualized revenue growth was reported at 62%.

• Improved customer diversification, delivery, productivity and cost control supported the recovery; subsidiaries still incurred losses, while consolidated profit was reported at Rs 15.5m.

Financial highlights

• Sales and other income Rs 392.11m for 9M FY 2000-01 versus Rs 321.74m for FY 1999-00; periods differ following the year-end change.

• Net profit Rs 34.10m versus a prior-period net loss of Rs 8.55m; profit before tax Rs 34.23m versus a loss of Rs 2.90m.

• EPS Rs 6.60 for nine months, or Rs 8.80 annualized; proposed dividend 7.5% of paid-up capital, equivalent to 10% annualized for the nine-month year.

• Export software-service revenue Rs 382.68m versus Rs 309.69m; foreign-exchange earnings totaled Rs 382.68m versus Rs 276.69m.

Outlook and guidance

• Management expected resilience to the US slowdown through offshore focus, broader global presence, regional partnerships and long-term key-customer relationships.

• Q1 FY 2001-02 revenue was Rs 112.00m and net profit Rs 3.97m, up from Rs 84.01m and Rs 3.85m YoY, but below prior-quarter Rs 143.03m revenue and Rs 8.92m profit.

• Onsite-to-offshore client shifts pressured near-term revenue; management expected a return to growth by the end of Q1 2002.

• UK and US subsidiaries were expected to break even in the final quarter of FY 2001-02; Middle East joint venture was expected to break even in the year beginning 1 Jan 2001.