Patni Q1 net income dips 17% at $15 mn

Global software services provider Patni Computer Systems today posted over 17% decline in net income at $15 million in the first quarter ended March 31, 2009, largely due to shrink in demand.      

Commenting on the results, Patni Computer CEO Jeya Kumar said, "The demand environment continues to be challenging in the short-run, however we are investing for portfolio expansion in all areas. Long-term growth prospects of the global delivery model are robust."      

The company had net income of $18.1 million in the quarter ended March 31, 2008, Patni said in a filing to the Bombay Stock Exchange.      

The revenues for the quarter stood at $156.4 million against $176.4 million in the same period last year, down 11%.      

Patni Computer Chief Financial Officer Surjeet Singh said "we are putting all levers of cost optimisation and reduction at work. While simultaneously investing for long-term growth. Currency changes are expected to cause volatility in addition to lower overall business visibility in short-run."      

Going forward, Patni expects its Q2 CY2009 revenues to be around $158 million and net income is expected to be in the range of $26.5 million to $27 million.      

Kumar further added that "we will see the benefits of our excellent financial health in further enhancing sustainable differentiation of our strategy."

"Mark to market forex loss during Q2 2009 is expected to be around $10 million based on current estimates," the company said adding that "this may change depending on further currency movements during the quarter and will impact our net earnings accordingly."      

The guidance (for Q2) is based on constant rupee-dollar rate of Rs 50 and constant pound-dollar rate of 1.45, euro-dollar rate of 1.30.      

The operating income for the quarter stood at USD 16 million, down 7.8% from its corresponding period in the year-ago period. In Q1 2008, the company had an operating income of USD 17.3 million.      

Earnings per share for the quarter was at USD 0.12 per share.      

The company further said that the revaluation and mark to market foreign exchange loss for the quarter were at USD 6.5 million as compared to foreign exchange loss of USD 12.6 million during the previous quarter.     

"Operating income including foreign exchange gain/loss during the quarter was at USD 16 million as against USD 14.8 million during the previous quarter," the company added.