LXFT Luxoft Holding Class A Ordinary Shares

Luxoft Holding, Inc (NYSE:LXFT), a leading provider of software development services and innovative IT solutions to a global client base, today announced results for the three and six months ended September 30, 2016.

Highlights – Three Months Ended September 30, 2016

• US GAAP revenue amounted to $196.5 million, an increase of 21.6% year over year and 10.3% sequentially on the reporting currency basis and 22.8% increase on the constant currency basis
• Earnings before interest, taxes, depreciation and amortization (EBITDA) adjusted for stock based compensation, acquisition related costs and change in fair value of contingent consideration was $37.4 million; adjusted EBITDA margin was 19.1%, compared to $29.6 million and 16.6% in the previous quarter
• Operating income increased 15.1% sequentially, generating 9.6% margin on a US GAAP basis, as compared to 9.2% in the previous quarter
• Diluted earnings per share (EPS) on a US GAAP basis was $0.48, compared to $0.42 in the previous quarter
• Diluted EPS on a non-GAAP basis was $0.83, compared to $0.62 in the previous quarter

Highlights – Six Months Ended September 30, 2016

• US GAAP revenue amounted to $374.5 million, an increase of 21.0% year over year on the reporting currency basis and 22.2% increase on the constant currency basis
• Adjusted EBITDA increased 4.5% year over year to $67.1 million and adjusted EBITDA margin was 17.9%
• US GAAP operating income amounted to $35.3 million
• Diluted EPS on a US GAAP basis was $0.90
• Diluted EPS on a non-GAAP basis was $1.44

Revenue for the three months ended September 30, 2016 increased to $196.5 million, up 21.6% from $161.5 million for the same period a year ago and 10.3% sequentially. Adjusted EBITDA was $37.4 million and corresponding margins of 19.1%, as compared to $37.0 million and 22.9% respectively in the year-ago quarter and $29.6 million and 16.6% sequentially. US GAAP net income was $16.3 million, or $0.48 per diluted share, compared to $23.0 million and $0.67 per diluted share for the same period a year ago and $14.1 million and $0.42 sequentially. Non-GAAP net income was $27.8 million, or $0.83 per diluted share, compared to $28.6 million and $0.84 per diluted share for the same period a year ago and $21.0 million and $0.62 sequentially. Reconciliations between non-GAAP financial measures and US GAAP operating results and diluted EPS are included at the end of this release.

Revenue for the six months ended September 30, 2016 increased to $374.5 million, up 21.0% from $309.6 million for the same period a year ago. Adjusted EBITDA increased 4.5% year over year to $67.1 million; adjusted EBITDA margin was 17.9%, as compared to $64.2 million and 20.7% in a year ago period. Operating income was $35.3 million, a decrease of 14.3% year over year from $41.2 million in the first half of last year. US GAAP net income was $30.4 million, or $0.90 per diluted share, compared to $37.6 million and $1.11 per diluted share for the same period a year ago. Non-GAAP net income was $48.9 million, or $1.44 per diluted share, compared to $49.2 million and $1.45 per diluted share for the same period a year ago.

"We are pleased to report financial results for the first half of the financial year, marked by strong growth despite extremely volatile economic conditions and lack of visibility on the market," stated Dmitry Loschinin, CEO and President of Luxoft Holding, Inc. "This is a transformational year for Luxoft. We are diversifying our business and lowering client and vertical concentration, resulting in 7.5% decline in top-client concentration over the first six months. We are expanding premium services and offering consulting capabilities in many standard platforms, such as Murex, Calypso, Pivotal and Pega, which our clients are adopting at increasing rates. We are rolling out new offerings in Internet of Things, big data, predictive analytics and many more. During the past quarter we completed two strategic value-accretive acquisitions, thus entering healthcare and pharmaceuticals, improving our position in the telecom vertical and expanding Human Machine Interface and Digital Cockpit practices in automotive. Given this improved positioning coupled with the diverse pipeline of business for the year ahead, we hope to achieve our soft target of $1 billion in revenues for the year ending March 31, 2018."

For the six months ended September 30, 2016, telecom, automotive and transport, and financial services were the strongest performers, delivering 61.4%, 54.6%, and 13.5% of revenue growth respectively, compared to the first six months of last year. Outside of the top two accounts, the company’s revenue grew 37% for the first six months of the year and 45% for the second quarter, both on a year over year basis.

During the past three months the company added seven high potential accounts (HPAs) from telecom, automotive and healthcare sectors. Key revenue generating geographies continued to grow: revenues generated in the U.S. increased 16.6%, in the U.K. increased 5.7%, in Germany increased 38.4%, in Switzerland increased 100.8%, and in the rest of Europe increased 91.7%, compared to the first six months of last year. The company generated a 1.2% increase in revenue per delivery employee, to $77,200 for the first half of the year. During the last quarter the total headcount crossed 11,000 employees to reach 11,898 as of September 30, 2016, while maintaining low attrition of 11.5%.

"We are pleased to report to our shareholders another period of steady revenue growth," said Roman Yakushkin, Chief Financial Officer. ”This year Luxoft embarked on many important initiatives on both, the business and operational sides, growing our sales force and increasing onshore presence in North America and Europe. We are also in the process of integrating three acquisitions closed during this calendar year, all of which are affecting our sales and general administrative expenses and temporarily weighing on our bottom line. At the same time we delivered healthy adjusted EBITDA margins in line with our internal targets and our guidance to the investment community. Our balance sheet remains strong and we continue to deliver healthy cash flow. Our revenue per engineer keeps growing and reached an all-time high six-month level, despite market-wide pricing and budgetary pressures, which is a testament to the quality and depth of the work we deliver. We are encouraged by the progress Luxoft is making on its way to becoming a strong diversified global IT services and IT consulting player."

Outlook for the Year Ending March 31, 2017:

The Company is reiterating its original revenue, adjusted EBITDA margin and non-GAAP EPS guidance for the financial year ending March 31, 2017:

• Revenue is expected to be at least $781 million, an increase of at least 20.0% year over year
• Adjusted EBITDA margin is expected to be in the range of 17.0% - 19.0%
• Diluted EPS on a non-GAAP basis is expected to be at least $2.85

The company is lowering its diluted EPS guidance on a GAAP basis to at least $1.65 from the original guidance of $2.10 due to higher acquisition-related expenses and SOP-related costs for additional incentives for new and existing key managerial personnel

EPS is based on an estimated weighted average of 33,967,797 diluted shares

Reconciliations between forward-looking non-GAAP financial measures and comparable forward-looking measures on a US GAAP basis are included at the end of this release.

Conference Call Information:

Luxoft Holding, Inc will host a conference call on November 11, 2016 at 8:00 a.m. EST to discuss its financial results for the three and six months ended September 30, 2016. To participate in the conference call please dial 877-407-8293 (for domestic U.S. callers) or 201-689-8349 (for international callers). A live webcast will also be available during the call and can be accessed at http://edge.media-server.com/m/p/bnk4dp7n. Participants, please access the website at least 10 minutes prior to the call to register and follow the instructions provided on the website to download and install the necessary applications. An archived recording of the conference call will be available for a limited time by dialing one of the following numbers: 877-660-6853 (for domestic U.S. callers) or 201-612-7415 (for international callers) and entering the conference ID# 13646999. The replay will be available from two hours as of the end of the call and up to 11:59 p.m. EST on November 25, 2016. The replay details will also be available at Luxoft's Investor Relations section during the same time period.

About Luxoft:

Luxoft Holding, Inc (NYSE:LXFT) is a leading provider of software development services and innovative IT solutions to a global client base consisting primarily of large multinational corporations. Luxoft’s software development services consist of core and mission critical custom software development and support, product engineering and testing, and technology consulting. Luxoft’s solutions are based on its proprietary products and platforms that directly impact its clients’ business outcomes and efficiently deliver continuous innovation. The Company develops its solutions and delivers its services from 31 dedicated delivery centers worldwide. It has over 11,000 employees across 38 offices in 18 countries in North America, Mexico, Western and Eastern Europe, Asia Pacific, and South Africa. Luxoft is incorporated in Tortola, British Virgin Islands, has its operating headquarters office in Zug, Switzerland and is listed on the New York Stock Exchange. For more information, please visit http://www.luxoft.com.

Non-GAAP Financial Measures:

To supplement our financial results presented in accordance with US GAAP, this press release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: earnings before interest, tax, depreciation and amortization (EBITDA); adjusted EBITDA; non-GAAP net income; and non-GAAP diluted Earnings per share (EPS). Non-GAAP net income and non-GAAP EPS exclude stock-based compensation expense, amortization of fair value adjustments to intangible assets and impairment thereof and other acquisitions related costs, that may include changes in the fair value of contingent consideration liabilities. Non-GAAP diluted EPS are calculated as non-GAAP net income divided by weighted average number of diluted shares. We provide these non-GAAP financial measures because we believe that they present a better measure of our core business and management uses them internally to evaluate our ongoing performance. Accordingly, we believe that these non-GAAP measures are useful to investors in enhancing their understanding of our operating performance. These non-GAAP measures should be considered in addition to, and not as a substitute for, comparable US GAAP measures. The non-GAAP results and a full reconciliation between US GAAP and non-GAAP results are provided in the accompanying tables at the end of this press release.

Forward-Looking Statements:

In addition to historical information, this release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements include information about possible or assumed future results of our business and financial condition, as well as the results of operations, liquidity, plans and objectives. In some cases, you can identify forward-looking statements by terminology such as "believe," "may," "estimate," "continue," "anticipate," "intend," "should," "plan," "expect," "predict," "potential," or the negative of these terms or other similar expressions. These statements include, but are not limited to, statements regarding: the persistence and intensification of competition in the IT industry; the future growth of spending in IT services outsourcing generally and in each of our industry verticals, application outsourcing and custom application development and offshore research and development services; the level of growth of demand for our services from our clients; the level of increase in revenues from our new clients; seasonal trends and the budget and work cycles of our clients; general economic and business conditions in our locations, including geopolitical instability and social, economic or political uncertainties, particularly in Russia and Ukraine, and any potential sanctions, restrictions or responses to such conditions imposed by some of the locations in which we operate; the levels of our concentration of revenues by vertical, geography, by client and by type of contract in the future; the expected timing of the increase in our corporate tax rate, or actual increases to our effective tax rate which we may experience from time to time; our expectations with respect to the proportion of our fixed price contracts; our expectation that we will be able to integrate and manage the companies we acquire and that our acquisitions will yield the benefits we envision; the demands we expect our rapid growth to place on our management and infrastructure; the sufficiency of our current cash, cash flow from operations, and lines of credit to meet our anticipated cash needs; the high proportion of our cost of services comprised of personnel salaries; our plans to introduce new products for commercial resale and licensing in addition to providing services; our anticipated joint venture with one of our clients; and our continued financial relationship with IBS Group Holding limited and its subsidiaries including expectations for the provision and purchase of services and purchase and lease of equipment; and other factors discussed under the heading "Risk Factors" in the Annual Report on Form 20-F for the year ended March 31, 2016 and other documents filed with or furnished to the Securities and Exchange Commission. Except as required by law, we undertake no obligation to publicly update any forward-looking statements for any reason after the date of this press release whether as a result of new information, future events or otherwise.

LUXOFT HOLDING, INC

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of US dollars, except share amounts)

   

As of September 30,

As of March 31, 2016 2016   Assets Current assets Cash and cash equivalents $ 80,189 $ 108,545 Trade accounts receivable, net of allowance for doubtful accounts of $303 at September 30, 2016 and $79 at March 31, 2016 162,621 131,204 Unbilled revenue 15,212 16,081 Work-in-progress 3,621 1,595 Due from related parties 1,517 2,180 VAT and other taxes receivable 1,637 1,814 Advances issued 3,402 2,413 Other current assets   4,005     3,333   Total current assets   272,204     267,165     Non-current assets Deferred tax assets 4,670 3,174 Property and equipment, net 45,978 46,072 Intangible assets, net 95,269 43,780 Goodwill 51,827 30,285 Other non-current assets   5,686     4,066   Total non-current assets   203,430     127,377   Total assets $ 475,634   $ 394,542     Liabilities and shareholders’ equity Current liabilities Short-term borrowings $ 492 $ 460 Accounts payable 18,589 8,266 Accrued liabilities 35,735 27,357 Deferred revenue 4,752 5,048 Due to related parties 386 518 VAT and other taxes payable 25,670 22,532 Payable under foreign exchange contracts 1,190 2,476 Payable for acquisitions, current 20,127 5,595 Other current liabilities   1,567     1,503   Total current liabilities   108,508     73,755     Deferred tax liability, non-current 5,579 5,511 Contingent payable for software acquisition, non-current 17,955 11,786 Other non-current liabilities   1,758     1,757   Total liabilities   133,800     92,809     Shareholders’ equity Share capital (80,000,000 shares authorized; 33,209,423 issued and outstanding with no par value as at September 30, 2016, and 80,000,000 shares authorized; 33,178,641 issued and outstanding with no par value as at March 31, 2016) — — Additional paid-in capital 118,376 107,477 Common stock held in treasury, at cost (37,877 shares as of September 30, 2016, 35,579 shares as of March 31, 2016) (2,799 ) (2,665 ) Retained earnings 231,241 200,870 Accumulated other comprehensive loss   (5,016 )   (3,981 ) Total shareholders’ equity attributable to the Group   341,802     301,701   Non-controlling interest   32     32   Total equity   341,834     301,733   Total liabilities and equity $ 475,634   $ 394,542  

LUXOFT HOLDING, INC

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands of US dollars, except share and per share amounts)

    For the three months For the six months ended ended September 30, September 30, 2016   2015 2016   2015   Unaudited Unaudited   Sales of services $ 196,457 $ 161,542 $ 374,506 $ 309,597 Operating expenses Cost of services (exclusive of depreciation and amortization) 114,908 90,446 220,660 178,423 Selling, general and administrative expenses 54,315 39,611 103,239 78,276 Depreciation and amortization 7,990 5,550 15,225 10,910 Loss from revaluation of contingent liability   344     41     61     784   Operating income   18,900     25,894     35,321     41,204     Other income and expenses Interest expense) income, net (28 ) (61 ) 4 (89 ) Other gains, net 327 283 734 576 (Loss) gain from foreign currency exchange contract (30 ) 517 361 685 Net foreign exchange loss   21     421     (646 )   1,569   Income before income taxes 19,190 27,054 35,774 43,945 Income tax expense   (2,899 )   (4,046 )   (5,403 )   (6,325 ) Net income $ 16,291 $ 23,008 $ 30,371 $ 37,620 Net (income) loss attributable to the non-controlling interest   —     —     —     —   Net income attributable to the Group $ 16,291   $ 23,008   $ 30,371   $ 37,620     Basic EPS per Class A and Class B ordinary share Net income attributable to the Group per ordinary share $ 0.49   $ 0.70   $ 0.91   $ 1.14   Weighted average ordinary shares outstanding   33,208,472     32,892,577     33,202,121     32,882,423     Diluted EPS per Class A and Class B ordinary share Diluted net income attributable to the Group per ordinary share $ 0.48   $ 0.67   $ 0.90   $ 1.11   Diluted weighted average ordinary shares outstanding   33,739,017     34,104,000     33,855,169     33,977,927  

LUXOFT HOLDING, INC

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands of US dollars)

    For the three months For the six months ended ended September 30, September 30, 2016   2015 2016   2015 Unaudited Unaudited Net income $ 16,291 $ 23,008 $ 30,371 $ 37,620 Other comprehensive (loss) income, net of tax (Losses) gains on derivative instruments, net of tax effect of $54 and $166 (253 ) — 610 — Translation adjustments with no tax effects (740 ) (465 ) (1,645 ) (138 ) Total other comprehensive (loss)   (993 )   (465 )   (1,035 )   (138 ) Comprehensive income   15,298     22,543     29,336     37,482     Comprehensive income (loss) attributable to the non-controlling interest   —     —     —     —   Comprehensive income attributable to the Group $ 15,298   $ 22,543   $ 29,336   $ 37,482  

LUXOFT HOLDING, INC

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW

(In thousands of US dollars)

  For the six months ended September 30, 2016 2015 (unaudited) Operating activities Income from operations $ 30,371 $ 37,620   Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 15,225 10,910 Deferred tax benefit (781 ) (1,031 ) Foreign currency exchange contracts income (361 ) (685 ) Loss (gain) on foreign exchange 646 (1,569 ) Provision for doubtful accounts 60 341 Loss from revaluation of contingent liability 61 784 Share-based compensation 13,889 8,426 Other — (62 )   Changes in operating assets and liabilities: Trade accounts receivable and unbilled revenue (14,150 ) 2,835 Work-in-progress (2,026 ) (1,834 ) Due to and from related parties 396 (579 ) Accounts payable 4,153 (133 ) Accrued liabilities (1,250 ) 2,582 Deferred revenue (813 ) (2,874 ) Changes in other assets and liabilities 2,772   (3,746 ) Net cash provided by operating activities 48,192   50,985     Investing activities Purchases of property and equipment (8,354 ) (8,368 ) Purchases of intangible assets (1,907 ) (2,676 ) Proceeds from disposal of property and equipment — 40 Acquisitions, net of cash acquired (54,464 ) — Short-term deposits —   (15,000 ) Net cash used in investing activities (64,725 ) (26,004 )   Financing activities Proceeds from short-term borrowings (6,028 ) (606 ) Acquisition of business, deferred consideration (4,534 ) (2,972 ) Repurchases of common stock (930 ) — Repayment of capital lease obligations (60 ) (50 ) Net cash used in financing activities (11,552 ) (3,628 )   Effect of exchange rate changes on cash and cash equivalents (271 ) 168   Net (decrease) increase in cash and cash equivalents (28,356 ) 21,521 Cash and cash equivalents at beginning of year 108,545   45,593   Cash and cash equivalents at end of period $ 80,189   $ 67,114  

LUXOFT HOLDING, INC

Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Measures

(Unaudited)

(In thousands of US dollars, except per share amounts and percentages)

  Three Months Ended September 30, Six Months Ended September 30, 2016 2016 2016 2016 2016 2016   GAAP Adjustments Non-GAAP   GAAP Adjustments Non-GAAP Operating income   18,900 12,674 (a)   31,574   35,321 20,608 (a)   55,929 Operating margin   9.6 % 6.5 %   16.1 %   9.4 % 5.5 %   14.9 % Net income   16,291 11,555 (b)   27,846   30,371 18,497 (b)   48,868 Diluted earnings per share $ 0.48   $ 0.83 $ 0.90   $ 1.44   Three Months Ended September 30, Six Months Ended September 30, 2015 2015 2015 2015 2015 2015   GAAP Adjustments Non-GAAP   GAAP Adjustments Non-GAAP Operating income   25,894 6,178 (a)   32,072   41,204 12,914 (a)   54,118 Operating margin   16.0 % 3.8 %   20.0 %   13.0 % 4.2 %   17.5 % Net income   23,008 5,611 (b)   28,619   37,620 11,622 (b)   49,242 Diluted earnings per share $ 0.67   $ 0.84 $ 1.11   $ 1.45

LUXOFT HOLDING, INC

Reconciliations of Non-GAAP Financial Measures to Comparable GAAP Measures

(Unaudited)

(In thousands of US dollars)

    Three Months Ended Six Months Ended September 30, September 30, (a) 2016   2015 2016   2015 Adjustments to GAAP operating income Stock-based compensation expense $ 9,029 $ 4,279 $ 13,889 $ 8,427 Amortization of purchased Intangible assets 2,446 1,858 4,553 3,703 Loss from revaluation of contingent liability 344 41 61 784 Acquisition related costs 855     —   2,105   —   Total Adjustments to GAAP income from operations: $ 12,674   $ 6,178   $ 20,608   $ 12,914     Three Months Ended Six Months Ended September 30, September 30, (b) 2016 2015 2016 2015 Adjustments to GAAP net income Stock-based compensation expense $ 9,029 $ 4,279 $ 13,889 $ 8,427 Amortization of purchased Intangible assets 2,446 1,858 4,553 3,703 Loss from revaluation of contingent liability 344 41 61 784 Acquisition related costs 855 — 2,105 — Tax effect of the adjustments   (1,119 )   (567 )   (2,111 )   (1,292 ) Total Adjustments to GAAP net income $ 11,555   $ 5,611   $ 18,497   $ 11,622     Three Months Ended Six Months Ended September 30, September 30, 2016 2015 2016 2015 Net income $ 16,291 $ 23,008 $ 30,371 $ 37,620 Adjusted for: Interest Expense (Income) 28 61 (4 ) 89 Income tax 2,899 4,046 5,403 6,325 Depreciation and Amortization   7,990     5,550     15,225     10,910   EBITDA $ 27,208   $ 32,665   $ 50,995   $ 54,944   Adjusted for Stock based compensation 9,029 4,279 13,889 8,427 Loss from revaluation of contingent liability 344 41 61 784 Acquisition related costs   855     —     2,105     —   Adjusted EBITDA $ 37,436   $ 36,985   $ 67,050   $ 64,155  

LUXOFT HOLDING, INC

Schedule of supplemental information

(Unaudited)

(In thousands of US dollars, except percentages)

  Revenue for the three Months Ended September 30, 2016 2015 Client location Amount   % of sales Amount   % of sales UK $ 57,221 29.1 % $ 59,055 36.6 % U.S. 66,247 33.7 % 50,559 31.3 % Germany 26,798 13.6 % 20,469 12.7 % Russia 8,055 4.1 % 7,528 4.7 % Switzerland 7,323 3.7 % 4,670 2.9 % Singapore 338 0.2 % 2,840 1.8 % Rest of Europe 22,689 11.5 % 10,579 6.5 % Other   7,786 4.1 %   5,842 3.5 % Total $ 196,457 100 % $ 161,542 100 %   Revenue for the six months ended September 30, 2016 2015 Client location Amount % of sales Amount % of sales UK $ 118,341 31.6 % 111,992 36.2 % U.S. 113,313 30.3 % 97,173 31.4 % Germany 53,147 14.2 % 38,408 12.4 % Switzerland 17,355 4.6 % 8,641 2.8 % Russia 15,000 4.0 % 16,038 5.2 % Singapore 3,417 0.9 % 5,138 1.7 % Rest of Europe 40,017 10.7 % 20,872 6.7 % Other   13,916 3.7 %   11,335 3.6 % Total 374,506 100 % 309,597 100 %   Revenue for the three Months Ended September 30, 2016 2015 Industry vertical Amount % of sales Amount % of sales Financial Services $ 123,137 62.7 % $ 112,681 69.8 % Automotive and transport 23,227 11.8 % 17,162 10.6 % Telecom 19,059 9.7 % 9,390 5.8 % Technology 11,742 6.0 % 11,317 7.0 % Healthcare 8,570 4.4 % — — % Travel and Aviation 7,373 3.8 % 7,367 4.6 % Energy 2,956 1.5 % 3,151 2.0 % Other   393 0.1 %   474 0.2 % Total $ 196,457 100 % $ 161,542 100 %     Revenue for the six months ended September 30,   2016 2015 Industry vertical Amount % of sales Amount % of sales Financial Services 245,504 65.6 % 216,246 69.8 % Automotive and transport 48,679 13.0 % 31,486 10.2 % Telecom 28,993 7.7 % 17,967 5.8 % Technology 20,876 5.6 % 22,048 7.1 % Travel and Aviation 15,088 4.0 % 14,641 4.7 % Healthcare 8,570 2.3 % — — % Energy 5,979 1.6 % 6,274 2.0 % Other   817 0.2 %   935 0.4 % Total 374,506 100 % 309,597 100 %

LUXOFT HOLDING, INC

Reconciliations of Non-GAAP Forward-looking Financial Measures

to Comparable GAAP Forward-looking Measures

(Unaudited)

(In thousands of US dollars, except share, per share amounts and percentages)

  Year Ended

March 31, 2017

Revenue $ 781,000     Net income $ 55,906   Adjusted for: Interest Expense 46 Income tax 10,316 Depreciation and Amortization   33,174   EBITDA $ 99,442   Adjusted for: Stock based compensation 28,274 Loss from revaluation of contingent liability 61 Acquisition related costs   5,177   Adjusted EBITDA $ 132,954   Adjusted EBITDA margin   17.0 %   Net income $ 55,906   Adjusted for: Stock-based compensation expense 28,274 Amortization of purchased Intangible assets 11,874 Loss from revaluation of contingent liability 61 Acquisition related costs 5,177 Tax effect of the adjustments   (4,649 ) Total adjustment to Net Income $ 40,737   Adjusted Net Income $ 96,643   Diluted weighted average ordinary shares outstanding   33,967,797   Adjusted EPS $ 2.85     Year Ended March 31, 2017 GAAP   Adjustments   Non-GAAP Net income $ 55,906 $ 40,737 $ 96,643 Diluted earnings per share $ 1.65     $ 2.85

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Luxoft Holding, IncAlina V. Plaia, +1 212-964-9900 ext. 2404Vice-President, Global CommunicationsIR@luxoft.com