Birlasoft (BSOFT) Q4 06/07 earnings summary

Executive summary

• FY07 consolidated revenue reached Rs. 4,637.01M, up 45.72% YoY; net profit was Rs. 504.76M, up 55.01%, achieving the US$100M revenue milestone.

• Growth priorities included manufacturing and diversified financial services, advanced technology offerings, customer expansion, offshore delivery, and improved profitability.

Financial highlights

• Consolidated revenue was US$102.52M and net profit US$11.17M; in US$ terms, YoY growth was 40.57% and 49.73%, respectively.

• Gross profit rose 56.41% to Rs. 1,753.34M; gross margin improved 2.58 percentage points to 37.81%.

• Consolidated operating profit before interest, depreciation and tax was Rs. 707.80M, up 53.2%; PAT margin increased to 10.89% from 10.23%.

• Consolidated EPS was Rs. 6.83 basic and Rs. 5.47 diluted, versus Rs. 4.54 and Rs. 3.66 in FY06; dividend recommended at Rs. 0.70 per Rs. 2 share.

Outlook and guidance

• FY08 revenue guidance: Rs. 6,150M–6,180M (US$143.02M–143.72M); net profit guidance: Rs. 700M–730M (US$16.28M–16.98M).

• FY10 mission: revenue of US$250M and profit of US$40M, excluding inorganic growth.

• Margin initiatives target higher offshore mix, improved utilization and productivity, better pricing from higher-value offerings, and greater leverage from scale.