Information technology services company iGATE Patni on Friday reported net profit of $24.1 million (Rs 123.6 crore) for the first quarter ended March 2012, but its revenue growth fell short of expectations, due to delays in starting projects.
Net profit for January-March increased 34.6 per cent for the Nasdaq-listed company from $17.9 mn (Rs 92 crore) in the corresponding period last year. Revenue for the quarter increased almost three times to $263.3 mn (Rs 1,356 crore) from $75.8 mn (Rs 390 crore) in the first quarter of 2011.
“The long tail rationalisation of our customers that we undertook yielded us higher profits but dipped revenues, and the delays in project kickoffs resulted in lesser revenue growth. We expect our revenue growth to be back on track over the next couple of quarters, creating a back-loaded year,” said Phaneesh Murthy, president and chief executive officer.
Gross margin remained flat at 40.2 per cent for the first quarter of 2012, compared to 40.9 per cent in the corresponding quarter last year.
Earlier this week, iGATE agreed to buy out the minority shareholders of Patni Computer Systems and have the software outsourcing company delisted from the Bombay Stock Exchange for Rs 520 per equity share. Last year, iGATE bought a majority stake in Patni in a roughly $1.22 billion deal.
“We are delighted that we managed to do a very complex capital restructuring within a year of completing the Patni acquisition. The successful delisting of Patni will be an important step towards our vision of one company and will set us up well for a possible downstream merger, while also reducing costs of compliance and governance,” said Sujit Sircar, chief financial officer.
iGATE Patni added seven new customers during the quarter. The company ended the first quarter of 2012 with 27,100 employees.