NIIT net profit up 17 per cent

Changing its positioning from an IT training company to a global talent development corporation led NIIT to record a 17 per cent rise in profit after tax (PAT), which touched Rs 15.4 crore for the quarter ended June 30 (first quarter)compared with Rs 13.2 crore reported in the corresponding quarter of the previous financial year.

With the inclusion of the $80 million US-based company Element K to its business in August in the last financial year, the company recorded a growth of 104 per cent in its net revenues - from Rs 110.2 crore in the first quarter of the previous year to Rs 225.4 crore in the first quarter of 2007. The growth in the quarter led to a rise in the earnings per share (EPS) to Rs 7.

Commenting on the not-so-impressive year-on-year growth in PAT, Vijay K Thadani, chief executive officer, NIIT, admitted, "the appreciating rupee had an obvious impact on the profits with a 6 per cent impact on the top line and 13 per cent on the bottom line."

The company gets 60 per cent of its international business primarily from the US. The rest 40 per cent of its revenues come from the domestic market. "Element K was not a part of the company in the first quarter in the previous year, thus leading to the limited impact on the PAT," added Thadani.

Sequentially too, the company suffered a decline of 9.9 per cent in PAT - falling from Rs 17.1 crore in the quarter ending March 31, to Rs 15.4 crore in the first quarter of the 2007-08. The revenue too witnessed a 12.1 per cent decline - from Rs 256.6 crore in the previous quarter to Rs 225.4 crore in the first quarter of this financial year.

Explaining the decline, Thadani said, "The educational business is highly seasonal. Our first quarter is always slow, the revenues from registrations done in this quarter will be seen in the next quarter which is always the best for our business."

During the quarter, the company's new businesses, IFBI and Imperia, increased enrollments in the current cycle by 100 per cent and extended to markets beyond the metros - in Pune and Ahmedabad.

Imperia launched three new programmes - human resource management, retail management and software development management from IIMs in Ahmedabad and Kolkata. IFBI extended its portfolio by partnering with three more leading banks.

The inclusion of Element K, also enabled NIIT get a number of orders in the corporate learning space contributing to an order intake of $38.5 million (Rs 156.12 crore) during the quarter.

The company's individual learning business recorded a 30 per cent growth in revenues in Q1 over the same period last year, with career programmes growing at 33 per cent.