iGATE Corporation (the Company) (Nasdaq:IGTE), the first integrated
Technology and Operations (iTOPS) company providing Business
Outcomes based solutions under the brand iGATE Patni, today
announced that a successful integration exercise with Patni
Computers has yielded positive results for the Company.
Declaring its financial results for the three and nine months
ended September 30, 2011, the Company said that it has seen a spurt
in Adjusted EBITDA and EPS with increased revenues, while the
attrition percentage has further decreased to less than 20% with
the combined entity showing clear signs of the integration efforts
being effective.
Third Quarter Highlights
- Revenues for third quarter 2011 were $265.7
million.
-- Compared with $74.8 million in the third quarter 2010
-- Compared with $170.4 million in the second quarter 2011
- Net Income for third quarter 2011 was $14.3
million.
-- Compared with $14.3 million in the third quarter 2010
-- Compared with $4.0 million in the second quarter 2011
-- Interest expense impacted net income by $19.5 million
- Gross margin was 36.9 % for the third quarter
2011.
-- Compared with 39.4% in the third quarter 2010
-- Compared with 34.7% in the second quarter 2011
- Diluted earnings per share for the
third quarter 2011 were $0.10 GAAP; $0.26
non-GAAP.
-- Compared with $0.25 GAAP in third quarter 2010; $0.28
non-GAAP in third quarter 2010
-- Compared with ($0.02) GAAP in second quarter 2011; $0.16
non-GAAP in second quarter 2011
- Adjusted EBITDA was $55.8 million for the third quarter
2011.
-- Compared with $19.2 million in the third quarter 2010
-- Compared with $28.6 million in the second quarter 2011
- 24 new customers were added during the third quarter,
including six Fortune 1000 companies.
- Headcount was at 26,216 employees as of September 30,
2011.
Highlights of Nine months ended September 30,
2011
- Revenues for the nine months ended September 30, 2011
were $511.9 million.
-- Compared with $199.6 million in the corresponding period in
2010
-- Interest expense impacted net income by $32.8 million
- Gross margin was 36.8% for the nine months ended
September 30, 2011.
-- Compared with 39.2% in the corresponding period in 2010.
- Diluted earnings per share were $0.28 GAAP; $0.63
non-GAAP.
-- Compared with $0.65 GAAP; $0.73 non-GAAP in the corresponding
period 2010
- Adjusted EBITDA was $105.4 million for the nine months
ended September 30, 2011.
-- Compared with $49.1 million in the corresponding period in
2010.
Commenting on the Company's third quarter performance, Phaneesh
Murthy, Chief Executive Officer, iGATE Patni said,
"With Phases one and two of integration largely done, I am
pleased with the positive results in the combined company.
We still have a ways to go to fix our new sales engine, but
overall we are making good progress."
On the IT budgets for 2012, he said, "We sense that the
IT budgets may be marginally up for some verticals and flat to
marginally down for others. We continue to see increased acceptance
of our iTOPS for Business Outcomes business model which should
drive growth in our revenues and profitability. Our differentiated
Product Engineering Service offering is also looking like a growth
driver for the company."
Sujit Sircar, Chief Financial Officer, iGATE, said, "The
clear uptick in our third quarter operating margins is testimony to
the success of our integration efforts and the combined entity
moving in the right direction. With the progress made, we feel
confident of our goal of 40% in gross margins and 25% in EBITDA
over the coming quarters."
Operating Results for the three and nine months ending
September 30, 2011
Results for the three and nine months ending September 30, 2011
on a GAAP and non-GAAP basis are provided in the table below.
|
|
Three months ended Sept 30,
2011 |
Three months ended Sept 30,
2010 |
Increase (Decrease) |
Nine months ended Sept 30,
2011 |
Nine months ended Sept 30,
2010 |
Increase
(Decrease) |
Net revenue
($Millions) |
265.7 |
74.8 |
255.20% |
511.9 |
199.6 |
156.50% |
Operating margin
($Millions) |
37.7 |
15.2 |
148.00% |
54.4 |
37.6 |
44.70% |
GAAP net income
($Millions) |
14.3 |
14.3 |
-- |
36.2 |
37.0 |
(2.20%) |
GAAP diluted EPS
($) |
0.10 |
0.25 |
(60.00%) |
0.28 |
0.65 |
(56.90%) |
Non-GAAP net income
($Millions) |
19.2 |
16.2 |
18.50% |
46.9 |
41.9 |
11.90% |
Non-GAAP diluted EPS
($) |
0.26 |
0.28 |
(7.10%) |
0.63 |
0.73 |
(13.70%) |
New customers and projects won in the
quarter
- A leading Fortune 1000 manufacturing company selected iGATE
Patni for SIM assessment and streamlining of its Service Life Cycle
Management.
- A leading industrial automation-focused Fortune 1000 company
chose iGATE Patni for benchmarking services to its online
division that offers web-based remote access, support, and
collaboration software and services.
- A leading manufacturing company in the process of integration
with its parent company has selected iGATE Patni for a managed
services engagement of its infrastructure and operations as well as
assistance in the integration program.
- A leading U.S.-based Fortune 1000 bank has engaged iGATE Patni
for Application Development and Maintenance Services.
- A leading European manufacturing company has selected iGATE
Patni for a Product Development engagement on its Pricing and
Sensitivity analysis tool.
- A Fortune 1000 company engaging in steel and metal
manufacturing has chosen iGATE Patni to expand implementation of
Sharepoint and integrate it with the client's existing SAP
systems.
Awards and Recognitions in the quarter
- iGATE Corporation was awarded the Golden Peacock Global Award
for Excellence in Corporate Governance- 2011 (Americas) by the
Institute of Directors.
- iGATE Patni was ranked No. 3 in the Data Quest-CMR Best
Employer Survey, 2011 for IT Companies in India.
- iGATE Patni was appraised at CMMI®-Dev V1.3 Level
5. Second company globally to be listed in PARS as
appraised at L5 using the new SCAMPI V1.3.
- iGATE Patni's Bangalore campus was awarded "Best
Ornamental Garden Award 2011" by the Mysore Horticultural
Society.
Conference Call and Webcast
iGATE will host a telephone conference call on Friday, November
4, 2011 at 8:00 a.m. Eastern Time to discuss the results of its
third quarter ended September 30, 2011. The live discussion can be
accessed by dialing 877-407-8037 (domestic) or 201-689-8037
(international). A live webcast of this conference call will be
available on our web site at http://ir.igate.com/investors. The
teleconference replay will be available until November 11, 2011 and
can be accessed by dialing 877-660-6853 (domestic) and 201-612-7415
(international), passcode 379807 and account number 293. A replay
will also be available shortly after the live call via webcast on
the iGATE Investor Relations website at
http://ir.igate.com/investors.
About iGATE Patni
'iGATE Patni' is the common brand identity of two organizations
— iGATE Corporation and Patni Computer Systems Limited (Patni).
With iGATE having acquired a majority stake in Patni, the two
companies, under the common brand iGATE Patni, jointly provide
full-spectrum consulting, technology and business process
outsourcing, and product engineering services on a Business
Outcomes-based model. Armed with over three decades of IT Services
experience and powered by the iTOPS (Integrated Technology and
Operations) platform, iGATE Patni's multi-location global
organization with a talent pool of 26,000+ people, consistently
delivers effective solutions to over 360 Fortune 1000 clients
spanning across verticals like: banking & financial services;
insurance & healthcare; life sciences; manufacturing, retail,
distribution & logistics; media, entertainment leisure &
travel; communication, energy & utilities; public sector; and
independent software vendors. Visit: www.igatepatni.com.
iGATE Corporation is listed on NASDAQ (IGTE), and Patni Computer
Systems Limited is listed on the Bombay Stock Exchange (532517),
the National Stock Exchange of India (PATNI) and New York Stock
Exchange (PTI).
The iGATE Patni brand logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=5150
Use of non-GAAP Financial Measures
This press release contains non-GAAP financial measures as
defined by the Securities and Exchange Commission. These non-GAAP
measures are not in accordance with, or an alternative for measures
prepared in accordance with, generally accepted accounting
principles in the United States and may be different from non-GAAP
measures used by other companies. In addition, these non-GAAP
measures are not based on any comprehensive set of accounting rules
or principles. Reconciliations of these non-GAAP measures to
their comparable GAAP measures are included in the attached
financial tables.
iGATE believes that non-GAAP measures have limitations in that
they do not reflect all of the amounts associated with iGATE's
results of operations as determined in accordance with GAAP and
that these measures should only be used to evaluate iGATE's results
of operations in conjunction with the corresponding GAAP
measures. These non-GAAP measures should be considered
supplemental in nature and should not be considered in isolation or
be construed as being more important than comparable GAAP
measures.
iGATE believes that providing Adjusted EBITDA and non-GAAP net
income and non-GAAP diluted earnings per share in addition to the
related GAAP measures provides investors with greater transparency
to the information used by iGATE's management in its financial and
operational decision-making. These non-GAAP measures are also used
by management in connection with iGATE's performance compensation
programs.
More specifically, the non-GAAP financial measures contained
herein exclude the following items:
- Amortization of intangible assets: Intangible assets comprise
value of customer relationships from the recent Patni acquisition
and the previous delisting of iGATE's Indian subsidiary. iGATE
incurs charges relating to the amortization of these intangibles.
These charges are included in iGATE's GAAP presentation of earnings
from operations, operating margin, net income and diluted earnings
per share. iGATE excludes these charges for purposes of calculating
these non-GAAP measures.
- Stock-based compensation: Although stock-based compensation is
an important aspect of the compensation of iGATE's employees and
executives, determining the fair value of the stock-based
instruments involves a high degree of judgment and estimation and
the expense recorded may not reflect the actual value realized upon
the future exercise or termination of the related stock-based
awards. Furthermore, unlike cash compensation, the value of
stock-based compensation is determined using a complex formula that
incorporates factors, such as market volatility, that are beyond
our control. Management believes it is useful to exclude
stock-based compensation in order to better understand the
long-term performance of our core business.
- Acquisition expenses: iGATE incurs costs related to its
acquisitions, which are inconsistent in amount and frequency and
are significantly impacted by the timing and nature of iGATE's
acquisitions. iGATE believes that eliminating these expenses for
purposes of calculating these non-GAAP measures facilitates a more
meaningful evaluation of iGATE's current operating performance and
comparisons to its past operating performance.
- Forex gain: The Company entered into forward foreign exchange
contracts to mitigate the risk of changes in foreign exchange rates
on payments related to the acquisition of Patni. We also recognized
favorable foreign currency gain on re-measurement of escrow account
balance maintained for facilitating payments related to Patni
acquisition. iGATE believes that eliminating the non-capitalized
items for purposes of calculating these non-GAAP measures
facilitates a more meaningful evaluation of iGATE's current
performance and comparisons to its past performance.
- Severance Cost: As a result of the acquisition of Patni, iGATE
incurred severance costs in connection with the termination of the
services of some of Patni's employees.
From time to time in the future, there may be other items that
iGATE may exclude in presenting its financial results.
Forward-Looking Statements
Statements contained in this press release regarding the
benefits of the Patni acquisition, the business outlook, the demand
for the products and services, and all other statements in this
release other than recitation of historical facts are
forward-looking statements. Words such as "expect", "potential",
"believes", "anticipates", "plans", "intends" and similar
expressions are intended to identify such forward-looking
statements. Forward-looking statements in the press release
include, without limitation, forecasts of market growth, future
revenues, future expectations concerning growth of business, cost
competitiveness and expansion of global reach following the
acquisition, and other matters that involve known and unknown
risks, uncertainties and other factors that may cause results,
levels of activity, performance or achievements to differ
materially from results expressed or implied by this press release.
Such risk factors include, among others: difficulties encountered
in integrating business; whether certain market segments grow as
anticipated; the competitive environment in the information
technology services industry and competitive responses to our
acquisition of Patni; and whether the companies can successfully
provide services/products and the degree to which these gain market
acceptance. Furthermore, in connection with the Patni
acquisition, the Company has borrowed significant amounts,
including through the issuance of high yield notes, and will have
to use a significant portion of its cash flows to service such
indebtedness, as a result of which the Company might not have
sufficient funds to operate its businesses in the manner it intends
or has operated in the past. Additional risks relating to the
Company are set forth in the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 2010, as well as the
Company's other reports filed with the Securities and Exchange
Commission and risks related to the business of Patni as set forth
in Patni's Annual Report in Form 20-F for the fiscal year ended
December 31, 2010. Actual results may differ materially from
those contained in the forward-looking statements in this press
release. Any forward-looking statements are based on
information currently available to the Company and it assumes no
obligation to update these statements as circumstances
change. This document does not constitute an offer to purchase
or to sell securities in any jurisdiction.
iGATE
CORPORATION |
CONDENSED CONSOLIDATED
BALANCE SHEETS |
(Amounts in thousands, except
per share data) |
|
|
|
|
September 30, 2011 |
December 31, 2010 |
|
(unaudited) |
(audited) |
ASSETS |
|
|
Current assets: |
|
|
Cash and cash
equivalents |
$ 84,956 |
$ 67,924 |
Short-term investments |
347,453 |
71,915 |
Accounts receivable, net |
148,452 |
37,946 |
Unbilled revenues |
79,191 |
13,893 |
Prepaid expenses and other current
assets |
21,782 |
5,380 |
Foreign exchange derivative
contracts |
694 |
794 |
Deferred tax assets |
27,242 |
5,422 |
Prepaid income taxes |
17,244 |
-- |
Receivable from Mastech Holdings
Inc. |
233 |
140 |
Total current assets |
727,247 |
203,414 |
|
|
|
Investment in affiliate |
387 |
-- |
Deposits and other assets |
131,415 |
5,443 |
Property and equipment, net |
195,913 |
52,950 |
Prepaid income taxes |
6,210 |
-- |
Deferred tax assets |
25,320 |
10,117 |
Goodwill |
575,443 |
31,741 |
Intangible assets, net |
167,805 |
1,378 |
Total assets |
$ 1,829,740 |
$ 305,043 |
|
|
LIABILITIES, PREFERRED
STOCK AND SHAREHOLDERS' EQUITY |
|
Current liabilities: |
|
|
Accounts payable |
$ 8,656 |
$ 3,291 |
Accrued payroll and related
costs |
73,401 |
19,709 |
Accrued income taxes |
4,727 |
715 |
Line of credit |
52,000 |
-- |
Other accrued liabilities |
95,000 |
31,354 |
Foreign exchange derivative
contracts |
8,804 |
-- |
Deferred revenue |
21,043 |
667 |
Total current liabilities |
263,631 |
55,736 |
|
|
|
Other long-term liabilities |
5,618 |
1,251 |
Accrued income taxes |
24,220 |
-- |
Foreign exchange derivative
contracts |
5,428 |
-- |
Deferred tax liabilities |
58,020 |
-- |
Senior Notes |
770,000 |
-- |
Total liabilities |
1,126,917 |
56,987 |
|
|
|
Series B Preferred stock, without par
value |
341,919 |
-- |
|
|
|
Shareholders' equity: |
|
|
|
|
|
Common Stock, par value $0.01 per
share |
578 |
572 |
Additional paid-in capital |
198,870 |
188,389 |
Retained earnings |
96,320 |
75,474 |
Common stock in treasury, at
cost |
(14,714) |
(14,714) |
Accumulated other comprehensive
loss |
(135,462) |
(1,665) |
Total iGATE Corporation shareholders'
equity |
145,592 |
248,056 |
Non controlling interest |
215,312 |
-- |
Total shareholders' equity |
360,904 |
248,056 |
Total liabilities and shareholders'
equity |
$ 1,829,740 |
$ 305,043 |
|
iGATE
CORPORATION |
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME |
(Amounts in thousands) |
(unaudited) |
|
|
|
|
|
|
Three Months
ended September 30, |
Nine Months ended
September 30, |
|
2011 |
2010 |
2011* |
2010 |
|
|
|
|
|
Revenues |
$ 265,724 |
$ 74,845 |
$ 511,939 |
$ 199,584 |
|
|
|
|
|
Cost of revenues (exclusive of Depreciation
and amortization) |
167,565 |
45,378 |
323,563 |
121,446 |
|
|
|
|
|
Gross margin |
98,159 |
29,467 |
188,376 |
78,138 |
|
|
|
|
|
Selling, general and administrative
expense |
46,745 |
12,056 |
108,915 |
33,904 |
|
|
|
|
|
Depreciation and amortization |
13,667 |
2,251 |
25,032 |
6,599 |
|
|
|
|
|
Income from operations |
37,747 |
15,160 |
54,429 |
37,635 |
|
|
|
|
|
Other (expenses) income, net |
(23,337) |
961 |
(7,487) |
2,769 |
|
|
|
|
|
Income before income taxes |
14,410 |
16,121 |
46,942 |
40,404 |
|
|
|
|
|
Income tax (benefit) expense |
(2,793) |
1,856 |
7,314 |
3,371 |
|
|
|
|
|
Net income before noncontrolling
interest |
17,203 |
14,265 |
39,628 |
37,033 |
|
|
|
|
|
Noncontrolling interest |
2,950 |
-- |
3,437 |
-- |
|
|
|
|
|
Net income attributable to iGATE
Corporation |
14,253 |
14,265 |
36,191 |
37,033 |
|
|
|
|
|
Accretion to Preferred Stock |
84 |
-- |
214 |
-- |
Preferred dividend |
6,769 |
-- |
15,131 |
-- |
Net income attributable to iGATE Corporation
common shareholders |
$ 7,400 |
$ 14,265 |
$ 20,846 |
$ 37,033 |
|
|
|
|
|
*Includes Patni revenues since
May 16, 2011. |
iGATE
CORPORATION |
Earnings Per Share |
(Amounts in thousands, except
per share data) |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
Three Months
Ended September 30, |
|
Nine Months Ended
September 30, |
PARTICULARS |
|
2011 |
|
2010 |
|
2011** |
|
2010 |
|
|
|
|
|
|
|
|
|
Net income attributable to iGATE common
shareholders |
|
$ 7,400 |
|
$ 14,265 |
|
$ 20,846 |
|
$ 37,033 |
Add: Dividends on Series B Preferred
Stock |
|
6,769 |
|
-- |
|
15,131 |
|
-- |
|
|
14,169 |
|
14,265 |
|
35,977 |
|
37,033 |
|
|
|
|
|
|
|
|
|
Less: Dividends paid on |
|
|
|
|
|
|
|
|
Common Stock |
$ -- |
|
$ -- |
|
$ -- |
|
$ 6,076 |
|
Unvested restricted stock |
-- |
|
-- |
|
-- |
|
60 |
|
Series B Preferred Stock |
6,769 |
6,769 |
-- |
-- |
15,131 |
15,131 |
-- |
6,136 |
Undistributed
Income |
|
$ 7,400 |
|
$ 14,265 |
|
$ 20,846 |
|
$ 30,897 |
|
|
|
|
|
|
|
|
|
Allocation of Undistributed
Income |
|
|
|
|
|
|
|
|
Common stock |
|
5,674 |
|
14,181 |
|
15,983 |
|
30,667 |
Unvested restricted stock |
|
22 |
|
84 |
|
62 |
|
230 |
Series B Preferred Stock |
|
1,704 |
|
-- |
|
4,801 |
|
-- |
|
|
$ 7,400 |
|
$ 14,265 |
|
$ 20,846 |
|
$ 30,897 |
|
|
|
|
|
|
|
|
|
Shares outstanding for
allocation of undistributed income: |
|
|
|
|
|
|
|
Common stock |
|
56,598 |
|
55,862 |
|
56,598 |
|
55,862 |
Unvested restricted stock |
|
219 |
|
330 |
|
219 |
|
330 |
Series B Preferred Stock |
|
17,002 |
|
-- |
|
17,002 |
|
-- |
|
|
73,819 |
|
56,192 |
|
73,819 |
|
56,192 |
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
|
Common stock |
|
56,616 |
|
55,762 |
|
56,478 |
|
55,493 |
Unvested restricted stock |
|
221 |
|
330 |
|
224 |
|
417 |
|
|
56,837 |
|
56,092 |
|
56,702 |
|
55,910 |
|
|
|
|
|
|
|
|
|
Weighted average common stock
outstanding |
|
56,616 |
|
55,762 |
|
56,478 |
|
55,493 |
Dilutive effect of stock
options and restricted shares outstanding |
1,330 |
|
1,736 |
|
1,428 |
|
1,690 |
Dilutive weighted average shares
outstanding |
|
57,946 |
|
57,498 |
|
57,906 |
|
57,183 |
|
|
|
|
|
|
|
|
|
Distributed earnings per
share: |
|
|
|
|
|
|
|
|
Common stock |
|
$ -- |
|
$ -- |
|
$ -- |
|
$ 0.11 |
Unvested restricted stock |
|
$ -- |
|
$ -- |
|
$ -- |
|
$ 0.11 |
|
|
|
|
|
|
|
|
|
Basic earnings per share from
operations |
|
|
|
|
|
|
|
|
Common Stock |
|
$ 0.10 |
|
$ 0.25 |
|
$ 0.28 |
|
$ 0.66 |
Unvested restricted stock |
|
$ 0.10 |
|
$ 0.25 |
|
$ 0.28 |
|
$ 0.66 |
|
|
|
|
|
|
|
|
|
Diluted earnings per share from
operations |
|
$ 0.10 |
|
$ 0.25 |
|
$ 0.28 |
|
$ 0.65 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
**Includes Patni revenue since
May 16, 2011 |
|
|
|
|
|
|
|
|
|
The number of outstanding
participative convertible preferred stock for which the earnings
per share exceeded the earnings per share of common stock
aggregated to 17.0 million shares for the three and nine months
ended Sep 30, 2011. These shares were excluded from the computation
of diluted earnings per share as they were anti-dilutive. |
iGATE
CORPORATION |
Reconciliation of Net income,
net of tax, to Adjusted EBITDA |
(Amounts in thousands) |
(unaudited) |
|
Three Months
ended September 30, |
Nine Months ended
September 30, |
|
2011 |
2010 |
2011 |
2010 |
|
|
|
|
|
Net income attributable to iGATE
Corporation |
$ 14,253 |
$ 14,265 |
$ 36,191 |
$ 37,033 |
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
13,667 |
2,251 |
25,032 |
6,599 |
Interest expenses |
19,546 |
47 |
32,834 |
80 |
Income tax (benefit) expense |
(2,793) |
1,856 |
7,314 |
3,371 |
Noncontrolling interest |
2,950 |
-- |
3,437 |
-- |
Other income, net |
(4,083) |
(1,083) |
(8,501) |
(4,002) |
Foreign exchange (gain)/loss |
7,874 |
75 |
(16,846) |
1,153 |
Stock Based Compensation |
4,346 |
1,800 |
8,868 |
4,859 |
Acquisition expenses |
-- |
-- |
10,914 |
-- |
Severance expenses |
-- |
-- |
6,164 |
-- |
Adjusted EBITDA (a non-GAAP measure) |
$ 55,760 |
$ 19,211 |
$ 105,407 |
$ 49,094 |
Non-GAAP Disclosure of Adjusted EBITDA
We present Adjusted EBITDA as a supplemental measure of our
performance. We define Adjusted EBITDA as net income attributable
to iGATE Corporation plus (i) depreciation and amortization, (ii)
interest expense, (iii) income tax expense, minus (iv) other
income, net plus (v) foreign exchange loss, (vi) stock based
compensation (vii) acquisition expenses and (viii) severance
expenses. We eliminated the impact of the above as we do not
consider them as indicative of our ongoing operating performance.
These adjustments are itemized below. You are encouraged to
evaluate these adjustments and the reasons we consider them
appropriate for supplemental analysis. In evaluating Adjusted
EBITDA, you should be aware that in the future we may incur
expenses that are the same as or similar to some of the adjustments
in this presentation. Our presentation of Adjusted EBITDA should
not be construed as an inference that our future results will be
unaffected by unusual or non-recurring items.
We present Adjusted EBITDA because we believe it assists
investors and analysts in comparing our performance across
reporting periods on a consistent basis by excluding items that we
do not believe are indicative of our core operating performance. In
addition, we use Adjusted EBITDA: (i) as a factor in evaluating
management's performance when determining incentive compensation,
(ii) to evaluate the effectiveness of our business strategies and
(iii) because our credit agreement and our indenture use measures
similar to Adjusted EBITDA to measure our compliance with certain
covenants.
Adjusted EBITDA has limitations as an analytical tool. Some of
these limitations are:
- Adjusted EBITDA does not reflect our cash expenditures, or
future requirements, for capital expenditures or contractual
commitments;
- Adjusted EBITDA does not reflect changes in, or cash
requirements for, our working capital needs;
- Adjusted EBITDA does not reflect the significant interest
expense, or the cash requirements necessary to service interest or
principal payments, on our debts; although depreciation and
amortization are non-cash charges, the assets being depreciated and
amortized will often have to be replaced in the future, and
adjusted EBITDA does not reflect any cash requirements for such
replacements; non-cash compensation is and will remain a key
element of our overall long-term incentive compensation package,
although we exclude it as an expense when evaluating our ongoing
operating performance for a particular period; Adjusted EBITDA does
not reflect the impact of certain cash charges resulting from
matters we consider not to be indicative of our ongoing operations;
and other companies in our industry may calculate adjusted EBITDA
differently than we do, limiting its usefulness as a comparative
measure.
Because of these limitations, adjusted EBITDA should not be
considered in isolation or as a substitute for performance measures
calculated in accordance with GAAP. We compensate for these
limitations by relying primarily on our GAAP results and using
Adjusted EBITDA only supplementally.
iGATE
CORPORATION |
Reconciliation of
Selected GAAP measures to Non-GAAP measures |
(Amounts in thousands,
except per share data) |
(unaudited) |
|
|
|
|
|
|
Three Months
ended September 30, |
Nine Months ended
September 30, |
|
2011 |
2010 |
2011 |
2010 |
Net income attributable to iGATE
Corporation |
$ 14,253 |
$ 14,265 |
$ 36,191 |
$ 37,033 |
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
Amortization of Intangible assets, net of
taxes |
2,119 |
191 |
3,640 |
577 |
Stock based Compensation, net of taxes |
3,508 |
1,717 |
6,726 |
4,280 |
Acquisition expenses |
-- |
-- |
10,914 |
-- |
Forex gain on acquisition hedging and
remeasurement, net of taxes |
(937) |
-- |
(15,251) |
-- |
Severance cost, net of taxes |
287 |
-- |
4,675 |
-- |
Non-GAAP Net income |
$ 19,230 |
$ 16,173 |
$ 46,895 |
$ 41,890 |
|
|
|
|
|
Basic earnings per share from
operations |
|
|
|
|
GAAP |
$ 0.10 |
$ 0.25 |
$ 0.28 |
$ 0.66 |
Non-GAAP |
$ 0.26 |
$ 0.29 |
$ 0.64 |
$ 0.75 |
|
|
|
|
|
Diluted earnings per share from
operations |
|
|
|
|
GAAP |
$ 0.10 |
$ 0.25 |
$ 0.28 |
$ 0.65 |
Non-GAAP |
$ 0.26 |
$ 0.28 |
$ 0.63 |
$ 0.73 |
|
|
|
|
|
Weighted average shares outstanding,
Basic |
73,839* |
56,092 |
73,704* |
55,910 |
Weighted average dilutive common
equivalent shares outstanding |
74,948* |
57,498 |
74,908* |
57,183 |
|
|
|
|
|
*Includes assumed
conversion of 17 million shares of Series B Preferred Stock as of
January 1, 2011. |
CONTACT: Media Contact
Prabhanjan Deshpande "PD"
+91 80 4104 5006
PD@igatepatni.com
Investor Contact
Araceli Roiz
+1 510 896 3007
araceli.roiz@igatepatni.com
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