Hexaware Q2 Net dips 12.8%; sees sustainable growth in 3-4 qtrs

Mid-sized IT services firm Hexaware Technologies today said its consolidated net profit has declined 12.8 per cent to Rs 86.02 crore for the quarter ended September 30, due to higher overhead costs.

The company's net profit stood at Rs 98.72 crore in the same quarter last year.

Its revenues increased 7.9 per cent to Rs 670.61 crore in the reported quarter from Rs 621.05 crore in the corresponding quarter last fiscal.

"We have begun a journey of change. This quarter, numbers were down on a lot of levels but I am focussed on the quarters ahead. This quarter, the sales, general and administrative expenses (SG&A) were higher in anticipation of future growth," Hexaware Technologies CEO and Executive Director R Srikrishna told PTI.

Hexaware expects 3-4 quarters before it can establish a sustainable trajectory of growth, he added.

Talking about growth drivers, Srikrishna said verticals like banking and financial services (BFS) and manufacturing, coupled with geographies like Europe were boosting revenues.

"Business intelligence and business analytics and Infrastructure Management Services (IMS) led the growth among service lines," he said.

During the quarter, the company added 10 new clients. At the end of September 2014, the company's headcount stood at 9,697 with an addition of 410 people. The attrition rate stood at 13 per cent.

Travel & Transportation accounted for Rs 113.79 crore, BFS Rs 250.47 crore, Insurance and Healthcare Rs 87.21 crore and Manufacturing and services Rs 128.81 crore during the said quarter.

Cash and cash equivalents at the end of September quarter were at Rs 419 crore.

"Merger and acquisitions will be an important part of our growth. By second quarter of next fiscal, we would have articulated how to go about this with a team in place," he said.