Demnonetisation hits NIIT, Q3 Net slides 56%

Skills and talent development company NIIT Ltd today posted a 56 per cent fall in consolidated net profit for three months ended December 31, 2016 at Rs 6 crore, hit hard by demonetisation.
Profit after tax stood at Rs 13.7 crore in the year ago period.
Net revenue during the December quarter rose two per cent to Rs 267.3 crore as compared to the corresponding period of the previous year.
Earnings before interest, tax, depreciation and amortization (EBITDA) halved to Rs 8 crore against Rs 16.4 crore during the year-ago period.
The company said that its Skills and Careers Group (SNC) recorded a net revenue of Rs 72.4 crore, down 13 per cent year-on-year during the just-ended quarter "impacted by low cash circulation due to demonetisation."

"Historically, 70 per cent of NIIT's India retail clients pay fees in cash, with even higher percentages in the Tier 2/3/4 towns," the statement added.

The Corporate Learning Group (CLG) which offers managed training services or MTS to companies in North America, Europe, Asia, and Oceania, recorded net revenue of Rs 177.4 crore during the quarter, up 12 per cent over same period of the previous year, and with constant currency growth of 14 per cent.
It added three new clients in third quarter of which two were MTS customers, taking the total number of MTS customers to 32. During the quarter, NIIT announced that its current MTS contract with a global pharmaceutical company headquartered in West London, UK, has been extended for a further four years.

"During this fiscal year, the CLG business has added 5 new multi-year contracts and 4 renewals in the telecom, oil and gas, life sciences, technology, manufacturing, energy, and mining sectors," it said.
For the first nine months of the fiscal, the company's revenue stood at Rs 826.1 crore, up eight per cent over the year-ago period while net profit was at Rs 34.9 crore.
"Excluding closed legacy businesses, year to date revenue from all focus go-forward business, grew at a robust 11 per cent," the statement said.
During the December quarter, the company entered into an exclusive partnership with US-based OpenMatters (led by Barry Libert), towards driving digital transformation for tier-1 organisations in India, China and emerging markets.

"This initiative will enable the top leadership of top tier firms to become digital leaders who will drive digital transformation initiatives that lead to greater growth and value. In a related move, Barry Libert has been appointed as a Digital Advisor to the NIIT Board," the statement pointed said.