Persistent Systems (PERSISTENT) Q4 07/08 earnings summary

Executive summary

• FY08 consolidated revenue reached $105.81M, up 51.23% YoY in USD and 34.60% in rupees; PAT was Rs. 831.74M, up 49.82%.

• Focus remained on outsourced software product development, with 500 product releases delivered for customers during the year and 170+ customers overall.

Financial highlights

• Consolidated revenue was Rs. 4,248.50M; total income was Rs. 4,517.85M, versus Rs. 3,156.28M and Rs. 3,177.15M, respectively, in FY07.

• Consolidated EBITDA was Rs. 1,169.16M, up 41.50% YoY; EBITDA margin was 25.88% versus 26.01%.

• PAT before exceptional and prior-period items was Rs. 866.92M, up 61.43%; adjusted for the Rs. 35.18M IPO expense write-off, PAT was Rs. 831.74M.

• Consolidated basic EPS was Rs. 29.11 reported and Rs. 30.34 excluding exceptional and prior-period items; diluted EPS was Rs. 23.19 and Rs. 24.17, respectively.

Outlook and guidance

• FY09 hiring plan called for 1,800 additional software professionals across Pune, Goa, Nagpur and Hyderabad development centres.

• FY09 outlook anticipated challenging global conditions and US-market uncertainty, while identifying opportunities in mobile internet, SaaS, cloud computing and virtualization.

• Strategic priorities included growing existing accounts, expanding IP capabilities, partnering across the product-development ecosystem, targeting small and mid-sized markets, and considering acquisitions.