Coforge consolidated results FY 2008-09
Coforge Limited, a leading IT solutions organization, announced its annual results for the year ended March 31, 2009, showing consolidated revenues of Rs.979.9 Crores, up 4% YoY from Rs. 941.5 Crores recorded last year. The company's hedge accounting policy based on Recognition & Measurement Principles' as enumerated per AS 30, for highly probable forecast transactions, has resulted in operating revenue being reduced by Rs. 54.2 Crores during the year due to the continuing weakening of the rupee against the dollar.
ANNUAL Performance at a Glance
Yr ended Mar 31, 2008 Rs. Cr Yr ended Mar 31, 2009 Rs. Cr Growth YoY Growth excluding hedging losses YoY
Consolidated Revenues 941.5 979.9 4% 10%
Operating Profit 176.3 176.4 0% 31%
Operating Margins 18.7% 18.0% (72)bps 358 bps
Profit After Tax 135.3 114.8 (15%)
The global economic climate during the year was characterized by extreme volatility and uncertainty.
“Despite the environmental challenges the company was able to consolidate business with improved order intake and absorb major portions of hedging losses by continuously improving cost structures during the year to deliver a steady operating margin of 18%.” said Mr. Arvind Thakur, CEO, Coforge Ltd.
Fresh order intake during the year was USD 312 Mn, an improvement of 36% over previous year. Revenue share from the US shrunk slightly to 31% on account of reduced revenues from hedging losses. Share of revenue from EMEA during this year remained at 50%, while rest of the world increased its share to 19% on stronger domestic demand in India. Growth in the BFSI segment remained muted at 1% during the year while business in the Travel and Transportation grew 16%, and revenue from Retail and Distribution grew 15%.
“Continuing its drive to specialize the company strengthened its position in select industry segments increasing revenue share from these segments to 84%. Further, growth in emerging non-linear business lines of Managed Services and IP-asset based solutions resulted in an increased revenue share to 25% as planned”, said Rajendra S Pawar, Chairman, Coforge Ltd.
The Board of Directors has recommended a dividend of Rs.6.5 per equity share.Coforge Consolidated Quarter Results (Jan-Mar 2009)Consolidated Revenues at Rs. 227.0 Crores, down 9% QoQ Revenue loss on account of crystallization of effective hedges Rs. 22.1 Crores Operating Margin at 18% PAT at Rs. 26.3 Crores up 57% QoQ
Coforge reported revenues of Rs.227.0 Crores for the quarter ended March 31, 2009, a decrease of Rs.21.5 Crores recorded in the corresponding quarter last year. The rupee further depreciated during the quarter against the dollar resulting in reduction in revenue of Rs. 22.1 Crores due to crystallization of effective hedges.
JAN-MAR QUARTER Performance at a Glance
Qtr ended Mar 31, 2008 Rs. Cr Qtr ended Mar 31, 2009 Rs. Cr Growth YoY Growth excluding hedging losses YoY
Consolidated Revenues 248.5 227.0 (9%) 0%
Operating Profit 46.7 40.4 (14%) 34%
Operating Margins 18.8 17.8 (102)bps 629 bps
Profit After Tax 31.0 26.3 (15%)
The global environment deteriorated dramatically in the second half of the FY 2008-09 with a significant impact in the last quarter. Major players in each industry segment experienced challenges on account of recessionary conditions impacting the IT industry as a whole.
“Top clients in our major industry segments cut back in their spending during the quarter. Our immediate response has been to step up marketing efforts to broad base clients and further improve cost structures to sustain operating margins” said Mr. Arvind Thakur, CEO, Coforge Ltd.
Operating Margin remained steady at 18%. Excluding the impact of hedging losses, operating margin for the quarter is computed at 25%. The Company enhanced its marketing efforts to strengthen its position by launching its next generation insurance processing framework (ipf3) for commercial insurance in US and India. Fresh order intake of USD 46 Mn were secured during the quarter which included addition of 5 new customers. Pending order booking executable over 12 months is USD 97 Mn.
"The economic crisis has resulted in discontinuities, leading to opportunities. Our initiatives in IP Platforms would transform the organization with enhanced specialization to explore these opportunities and compete effectively in these challenging times” said Mr. Pawar
The total number of people engaged at the end of the quarter under review was 4238.Acknowledgements:
» Coforge ranked Number 1 in the Black Book of Outsourcing 2008 Travel Industry survey. » Coforge ranked No. 3 amongst global ITO service providers in the Black Book of Outsourcing 2008 Insurance industry Survey. » Coforge ranked amongst the 2008 Black Book Top 50 Best Managed Outsourcing Vendors. » Coforge declared 'Business Superbrand' for 2008 by the Superbrands Council of India. » Coforge was awarded the Distinguished Services Award for their initiatives and efforts in promoting business with USA by Georgia Tech Center for International Business Education & Research. » Coforge was felicitated with the Employer Branding Award for Excellence in HR through Technology and for Innovation in Career Development by the Asia Pacific HRM congress at the regional level. » Coforge' subsidiary ROOM Solutions Ltd UK. conferred with an Accomplishment Award at the ACORD LOMA Insurance Systems Forum. » Coforge was recognized amongst the top 50 IT Innovators for the year 2008 by NASSCOM.
» Coforge was amongst the Top 100 IT organizations ranked globally by IAOP. Coforge stands at 33rd overall and 7th in the Balanced Performance. » Coforge ranked amongst the Global Services 100 - 2009 list. The list represents companies who have the maturity and capability to lead the next wave of services globalization.
About Coforge Coforge is a leading IT solutions organization, servicing customers in North America, Europe, Asia and Australia. It offers services in Application Development and Maintenance, Enterprise Solutions including Managed Services and Business Process Management to organizations in the Financial Services, Travel, Retail and Distribution, and Government sectors. Coforge follows global standards of development, which includes ISO 9001:2000 certification, assessment at Level 5 of both SEI-CMMi version 1.2 and People-CMM frameworks and ISO 27001 information security management certification. Its data centre operations are assessed at the international ISO 20000 IT management standards. For further information, please visit www.coforgetech.com Safe Harbor
Certain statements in this release are forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT services including those factors which may affect our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies / entities in which we have made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies and unauthorized use of our intellectual property and general economic conditions affecting our industry. The company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the company.