Cyient (532175) Q4 03/04 earnings summary

Executive summary

• FY 2003-04 consolidated revenue rose 16% to Rs. 1,874.7 million, while EBITDA fell to Rs. 292.0 million and PAT to Rs. 90.1 million amid higher costs and lower-margin onsite and near-shore delivery.

• Business mix continued shifting from GIS conversion toward engineering and software services; these businesses contributed 66% of revenue, versus 40% two years earlier.

• Order intake increased 23% YoY, new-account intake rose 78%, and year-end business visibility exceeded Rs. 1.25 billion.

Financial highlights

• Consolidated revenue was Rs. 1,874.68 million versus Rs. 1,613.00 million in FY 2002-03; EBITDA was Rs. 292.00 million versus Rs. 357.81 million, and PAT was Rs. 90.06 million versus Rs. 149.10 million.

• Consolidated EBITDA margin was 15.58% versus 22.18%; PAT margin was 4.80% versus 9.24%.

• Consolidated basic EPS was Rs. 6.21 versus Rs. 10.33; dividend was recommended at Rs. 1.25 per share, unchanged YoY.

• Consolidated fixed-asset additions were Rs. 254.24 million versus Rs. 98.60 million; cash and equivalents were Rs. 374.79 million versus Rs. 454.68 million.

Outlook and guidance

• FY 2004-05 outlook anticipated growth from wider acceptance of offshore outsourcing and demand for engineering, GIS, and domain-focused IT services; longer sales cycles and gradual ramp-ups remained possible.

• A North America sales executive expected top-line growth of at least 30% in FY 2004-05, citing customer referrals and a bullish outlook for the next four quarters.

• Strategy centered on scaling direct sales, new accounts, chosen verticals, and offshore/near-shore delivery; investment in sales and infrastructure was expected to support growth.