Syntel revenue up five percent in 2015-16 Q2

Syntel Inc., a global provider of digital transformation, information technology and knowledge process services to Global 2000 companies, has announced financial results for the second quarter, ended June 30, 2015.

Syntel's revenue for the second quarter rose to USD 239.8 million from USD 228.2 million in the prior-year period and USD220.6 million in the first quarter of 2015.

During the second quarter, banking and financial services accounted for 48.3 percent of total revenue, with retail, logistics and telecom at 16.6 percent, healthcare and life sciences at 16.4 percent, insurance at 14.6 percent, and manufacturing at 4.1 percent.

The company's gross margin was 38 percent in the second quarter, compared to 39.2 percent in the prior-year period and 35.7 percent in the first quarter of 2015.

Selling, General and Administrative (SG&A) expenses were 9.1 percent of revenue in the second quarter, compared to 11.5 percent in the prior-year period and 16 percent in the previous quarter.

The second quarter income from operations was 28.9 percent of revenue as compared to 27.7 percent in the prior-year period and 19.7 percent in the first quarter.

The sequential rise in operating margin during the second quarter primarily reflects higher revenue and utilization and the impact of currency-related balance sheet translations.

Net income for the second quarter was USD 60.6 million or USD 0.72 per diluted share, compared to USD 59.3 million or USD 0.71 per diluted share in the prior-year period and net income of USD 40 million or USD 0.48 per diluted share in the first quarter of 2015.

During Q2, Syntel spent USD 5.7 million in CAPEX, largely in support of campus infrastructure, and finished the quarter with cash and short-term investments of USD 929.7 million. The company ended the quarter with 23,006 employees globally.

"We executed well during the second quarter, regaining momentum across many of our industry groups," said Syntel CEO and President Nitin Rakesh.

He further said, "Digital initiatives remained a high priority this quarter as customers sought to build competitive advantage and these projects started to ramp."

"Strong execution is evident in our healthcare and life sciences industry group, which grew both sequentially and year on year despite some difficult year ago comparisons," said Rakesh.

He added, "I am pleased to see positive early returns on the investments we've made to broaden our capabilities in the payer and provider segments."

"Our ability to provide innovative solutions in response to rapid changes in our customers' businesses has been critical in strengthening these relationships and driving our growth. We remain committed to providing high-value solutions that address our clients' most pressing needs and look forward to supporting their long-term success," he said.