Oracle Financial Services Software (532466) Q4 07/08 earnings summary

Executive summary

• FY08 consolidated revenue rose 15% YoY to Rs. 23,802.4 million; net income increased 12% to Rs. 4,155.9 million, with net margin declining to 17% from 18%.

• Product revenue growth of 24% led performance; Services grew 5%, while KPO revenue grew 28% but remained loss-making.

Financial highlights

• Consolidated operating income increased 5% to Rs. 3,966.4 million; income before tax was Rs. 4,606.1 million, and net income was Rs. 4,155.9 million.

• Revenue grew 15% to Rs. 23,802.4 million; cost of revenue rose 18% to Rs. 13,040.3 million and was 55% of revenue, versus 54% in FY07.

• Consolidated basic EPS was Rs. 49.66 and diluted EPS Rs. 49.58; FY07 comparatives were Rs. 47.05 and Rs. 45.76.

• Operating cash flow increased to Rs. 4,012.1 million from Rs. 1,645.9 million; consolidated cash and bank balances were Rs. 8,965.6 million at year-end.

Outlook and guidance

• Outlook emphasized opportunities from core banking modernization, integrated governance, risk and compliance, process transformation, emerging markets, payments, and self-service banking.

• Joint offerings with Oracle were positioned to address broad banking needs through interoperable, extensible, standardized solutions; capital and working-capital needs were expected to be met by operating cash flow.