IGATE net profit rises 14.8% to $38 mn

IGATE net profit rises 14.8% to $38 mn

The company had posted a net profit of $33.1 million in the year-ago period, it said in a statement.

US-based outsourcing solutions firm IGATE on Tuesday reported a 14.8 per cent growth in net profit at $38 million for the fourth quarter ended December 31, 2014, helped by deals in industry utility-solutions.

The company had posted a net profit of $33.1 million in the year-ago period, it said in a statement.

Revenues rose by 10.7 per cent to $331.5 million in the October-December quarter of 2014 fiscal from $299.3 million in the same quarter in 2013. The figures are on GAAP basis.

Commenting of the performance, IGATE President and CEO Ashok Vemuri said: "We delivered growth both sequentially as well as year over year, a result of the differentiated industry utility-solutions, enhanced client-centricity, streamlining of our core execution, building next-gen capabilities, and committed iGATORs."

Quarter-on-quarter IGATE's revenue was up 2.7 per cent from $322.8 million in the third quarter of 2014. Net profit was up marginally up from $37.3 million.

The firm added nine new clients during the December quarter. Total headcount stood at 33,484 employees.

IGATE CFO Sujit Sircar said: "...we induced conversion of 8 per cent Series B preferred stock on November 4, 2014, which will be value accretive going forward and will also improve our credit rating. However, we continue to see foreign exchange volatility that needs to be monitored and observed carefully."

The firm said its GAAP diluted EPS (Earnings Per Share) includes USD 80 million paid to Series B preferred stock holders for the induced conversion and $1.7 million towards write-off of unamortised preferred stock issuance cost.

Going ahead, Vemuri said: "Our digital practice will be a key focus area for us in 2015 and we will continue to leverage our ITOPS solutions."

According to analysts, the firm's revenue growth matches industry growth standard.

Greyhound research CEO Sanchit Vir Gogia said: "We believe that the sequential revenue growth of 2.7 per cent is as per industry standards. IGATE's main strengths are in Healthcare, FSI and Manufacturing sector."

"Also, with NHS in the UK going the privatisation way soon, we believe that huge investments are expected to happen then and this surely puts iGate in a very well placed and profitable spot," he added.

Although IGATE is now aggressively focusing on Mobility and Digital, a lot of work still remains to be done to gain better from their ITOPS solutions, he said said.

For the entire 2014 fiscal, IGATE's net profit fell 15 per cent to $110 million against $129.8 million in 2013 fiscal. Revenues rose by 10.2 per cent to $1.26 billion from $1.15 billion during the same period.

The company added 29 new clients during the year and its employee additions (net) stood at 3,751.