iGATE, (Nasdaq:IGTE), an integrated technology and operations
(iTOPS) company, today announced its financial results for the
first quarter ended March 31, 2010.
First quarter highlights
Revenues were $57.9 million compared to $44.8 million made in
the corresponding quarter previous year
Achieved 40.1% gross margin and 20.1% net margin
Diluted earnings per share was $0.20, (including a gain of 2
cents from sale of assets) a 122% increase over corresponding
quarter previous year
7,357 employees as of March 31, 2010; net addition of 447
employees during the quarter
7 new customers added in the quarter
iGATE rebranded with a tag-line "iTOPS for Business
Outcomes" conforming to a single message as an outcome based
organization
"Our growth in revenue and exponential jump in EPS reflects a
good performance coming on the back of a recovery in our key
segments," said Phaneesh Murthy, Chief Executive Officer of iGATE
Corporation. "We have strengthened our leadership team with several
strategic hires to drive revenue growth and build solutions for the
future."
"While we had an excellent performance in Q1 and expect revenues
to grow, margins are likely to be under pressure due to increased
hiring, rupee appreciation and wage inflation. Our cash and
cash equivalents and short-term investments crossed the $100
million mark," said Sujit Sircar, Chief Financial Officer of iGATE
Corporation.
First quarter operating results
Revenues for the quarter were $57.9 million compared to $44.8
million in the same period last year. Gross profit margin was 40.1%
compared to 35.9% in the corresponding quarter last year.
Operating income for the quarter grew to $11.0 million from $5.6
million in the same period last year. Operating margin was 19.0% up
from 12.5% in the corresponding quarter last year.
Net income was $11.6 million, or $0.20 per diluted share,
compared to net income of $5.0 million or $0.09 per diluted share
in the same period last year. Net margin was 20.1% as against 11.2%
in the corresponding quarter last year.
During the quarter, the company's cash and cash equivalents and
short-term investments went up from $ 96.8 million to $100.3
million after the payment of a $ 6.1 million dividend.
Key customer wins and significant projects during the
quarter
iGATE won a multi-year development agreement for enhancing and
modernizing legacy banking applications for one of North America's
largest banks, an existing iGATE customer. iGATE will be
responsible for a series of development projects around existing
and new retail banking applications.
A direct marketing agency, part of a Fortune 500 corporate media
services conglomerate selected iGATE as its preferred partner
to execute a Business Intelligence and Analytics
project. iGATE will develop a business intelligence
framework to help the client offer customized and focused
direct marketing programs for several of its
premier clientele.
A North American Bank engaged iGATE for its end to end loan
fulfillment activities. In addition iGATE is also outsourcing a
number of other business processes.
A leading innovative communications test and measurement
solutions company transitioned to iGATE its complex
electronic equipment procure-to-pay processes including both direct
and indirect procurement and interfacing with contract
manufacturers. By combining our expertise in finance process
transformation, technology automation and shared services we expect
to reduce the general and administrative costs for the client and
increase their margins.
iGATE and its Japanese partner CAC were selected by one of
Japan's largest financial services firms to assist in a strategic
project that involves upgrading of the firm's commercial banking
system. This upgrade is expected to provide new features to
business users, and enhance the ease of maintenance for IT.
For a leading global provider of distribution facilities in
North America, iGATE is working to create a roadmap for
consolidation of global instances of PeopleSoft finance modules and
re-implementation of PeopleSoft HRMS.
Management Update
iGATE strengthened its leadership team by appointing a number of
senior executives from diverse industries and verticals. Key hires
include:
David Kruzner to lead Consulting and Solutions Development. With
over 22 years of executive management experience, David is a
leading strategist for C-Suite executives, working at the
intersection of business, technology and people. He served on
boards of The Concours Group and Natural Bridge Solutions.
Patrick Burke to lead strategic account pursuits. He
comes from Cognizant Technology Solutions where he led sales
for Banking and Financial Services. He brings over a decade of
experience in selling strategic deals to Fortune 1000
companies.
Ari Aaltonen to head Europe Sales. He has over two decades of
experience in building world-class sales and consulting
organizations. Most recently he was the head of Oracle solution
practice at Cognizant Technology Solutions.
Elizabeth Koshy to lead new account pursuits in Media and
Entertainment vertical. She comes in with over 18 years of
experience in the global media and entertainment industry. She has
been a serial entrepreneur and founded one of the largest
Flash-based studios in Asia, a leading CGI studio in India and
established a leading event and celebrity management company.
Tim Relke joins to lead new account development in
Canada. He has over two decades of experience in business
process and information technology outsourcing in a wide range of
industries. Most recently, Tim was a strategy, corporate
development and interim CFO consultant to several Toronto-based
business process outsourcing and software-as-a-service
start-ups.
Important events during the quarter
Ranked #1 globally in IT outsourcing in the Media &
Entertainment and #2 in Data Warehousing and Business Intelligence
by Black Book of Outsourcing
Featured in IAOP Global Outsourcing 100
Mentioned in Emerging Service Analysis: C&SI for Analytics,
Business Intelligence and Performance Management by
Gartner
Mentioned in Platform BPO: Process Outsourcers Take A New
Approach to Traditional BPO by Forrester
Launched Distinguishing Competency Framework that deals with
transformational leadership and value creation competencies
Initiated coverage from Global Hunter Securities and HFP Capital
Markets, two new sell side analysts
Conference Call and Webcast
iGATE will host a telephonic conference call on Wednesday, April
14, 2010 at 9:00 a.m. Eastern time to discuss the results of its
first quarter ended March 31, 2010. A live webcast of this
conference call will be available on our web site at www.igate.com.
A replay of the call will be available until April 21, 2010.
About iGATE
iGATE (Nasdaq:IGTE) is the first outsourcing solutions provider
to offer a business outcome based pricing model through a fully
integrated technology and operations (iTOPS) structure with global
service delivery. iGATE works with clients to optimize their
businesses, secure substantial and sustainable year on year cost
benefits and tie costs to business needs and results. iGATE
provides IT consulting; application development and maintenance;
data warehousing; business intelligence solutions; ERP/ enterprise
solutions; BPO/business service provisioning; infrastructure
management; independent verification and validation; KPO and
contact center services. The company has been assessed at CMMI
Level 5, follows Six Sigma methodologies, is COBIT, ISO 9001
and ISO 27001 certified, ensuring the highest levels of quality and
data security. iGATE has 30 offices in 16 countries and manages
global delivery centers in Mexico, Australia, Malaysia and India.
iGATE is rated as a leading employer in India. For more
information, please visit www.igate.com.
The iGATE Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=5150
Forward-Looking Statements
Some of the statements contained in this news release that are
not historical facts are forward-looking statements. These
forward-looking statements include the company's financial, growth
and liquidity projections as well as statements concerning the
company's plans, strategies, intentions and beliefs concerning
business cash flows, costs and the markets in which it
operates. Without limiting the foregoing, the words
"believes," "anticipates," "plans," "expects" and similar
expressions are intended to identify certain forward-looking
statements. These statements are based on information
currently available to the company and it assumes no obligation to
update the forward statements as circumstances change. There
are risks and uncertainties that could cause actual events to
differ materially from the forward-looking statements. These
risks include, but are not limited to, the company's ability to
predict its financial performance, the level of market demand for
its services, the highly-competitive market for the types of
services offered by the company, the impact of competitive factors
on profit margins, market conditions that could cause the company's
customers to reduce their spending for its services, the company's
ability to create, acquire and build new businesses and to grow
existing businesses, attract and retain qualified personnel, reduce
costs and conserve cash, currency fluctuations and market
conditions in India and elsewhere around the world, political and
military tensions in India and South Asia, changes in generally
accepted accounting principles and/or their interpretation and
other risks that are described in more detail in the company's
filings with the Securities and Exchange Commission including its
Form 10-K for the year ended December 31, 2009.
iGATE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except per share data)
March 31,
2010
December 31,
2009
(unaudited)
(audited)
ASSETS
Current assets:
Cash and cash equivalents
$ 18,511
$ 29,565
Short-term investments
81,800
67,192
Accounts receivable, net
27,844
24,533
Unbilled revenues
12,803
9,636
Prepaid expenses and other current assets
4,094
4,628
Foreign exchange derivative contract
1,415
--
Prepaid income taxes
3,704
4,247
Deferred tax assets
35
31
Receivable from Mastech Holding Inc.
134
87
Total current assets
150,340
139,919
Deposits and other assets
4,846
4,482
Property and equipment, net
43,173
42,682
Deferred tax assets
10,304
8,474
Goodwill
31,606
30,517
Intangible assets, net
1,965
2,086
Total assets
$ 242,234
$ 228,160
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable
$ 2,412
$ 1,515
Accrued payroll and related costs
11,947
14,173
Accrued expenses
14,158
14,160
Foreign exchange derivative contracts
--
1,097
Other current liabilities
4,140
3,843
Restructuring reserve
75
101
Deferred revenue
509
918
Total current liabilities
33,241
35,807
Other long-term liabilities
1,126
1,035
Total liabilities
34,367
36,842
Shareholders' equity:
Common Stock, par value $0.01 per share
563
561
Additional paid-in capital
181,816
180,278
Retained earnings
43,766
38,228
Common stock in treasury, at cost
(14,714)
(14,714)
Accumulated other comprehensive loss
(3,564)
(13,035)
Total shareholders' equity
207,867
191,318
Total liabilities and shareholders' equity
$ 242,234
$ 228,160
iGATE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)
(unaudited)
Three Months ended,
March 31,
2010
2009
Revenues
$ 57,890
$ 44,809
Cost of revenues (exclusive of Depreciation and
amortization)
34,678
28,719
Gross margin
23,212
16,090
Selling, general and administrative
10,005
8,586
Depreciation and amortization
2,222
1,903
Income from operations
10,985
5,601
Other income (expense), net
832
(753)
Income before income taxes
11,817
4,848
Income tax expense (benefits)
203
(153)
Net income
$ 11,614
$ 5,001
Distributed earnings per share:
Common stock
$ 0.11
$ 0.09
Unvested restricted stock
0.11
0.09
Basic earnings per share from operations
Common Stock
$ 0.21
$ 0.09
Unvested restricted stock
0.21
0.09
Dilutive earnings per share from operations
$ 0.20
$ 0.09
Weighted average shares outstanding, Basic
55,234
54,184
Weighted average dilutive common equivalent shares
outstanding
56,722
55,139
CONTACT: iGATE Corporation
Investor Contact:
Salil Ravindran
+1 510-896-3015
salil.ravindran@igate.com
Media Contact:
Rathnam Subramanyam
+1 510-402-7354
pr@igate.com
Igate (NASDAQ:IGTE)
Historical Stock Chart
From May 2024 to Jun 2024
Igate (NASDAQ:IGTE)
Historical Stock Chart
From Jun 2023 to Jun 2024