Zensar Q1 profit falls to Rs 47.2 cr on forex impact

Zensar Technologies today posted over 36 per cent fall in net profit at Rs 47.2 crore for the quarter ended on June 30, 2017, mainly on account of currency volatility.
This is against a net profit of Rs 74.1 crore in the year-ago period, Zensar said in a statement.
Its revenue declined 2.5 per cent to Rs 736.7 crore in the reported quarter from Rs 755.4 crore in the same quarter last fiscal.
"Currency volatility had a major impact on profitability this quarter," Zensar Technologies CEO and MD Sandeep Kishore said.
On sequential basis, Zensar's net profit jumped 356.6 per cent (from Rs 10.3 crore in March 2017 quarter) while revenues fell about 1 per cent.

"Despite the currency headwinds, we have maintained our profitability... Forex impact on gross margin is 1.2 per cent adverse. We continue to retain sharp focus on operational efficiencies and drive towards cost optimisation," Zensar Technologies CFO Manoj Jaiswal said.

In dollar terms, the company saw its net profit declining close to 40 per cent to USD 7.3 million, while revenues grew 1.2 per cent to USD 114.3 million.
Digital services contributed 36.3 per cent to the revenue contribution in the quarter under review from 34.4 per cent in the March 2017 quarter.
"Zensar's digital business has kept up its growth momentum in the first quarter of fiscal year 2017-2018... The new services and solutions built on the key premise of Return on Digital have contributed to over half of our new wins," Kishore said.

The US accounted for 74.4 per cent of the company's revenues in the said quarter, while Europe and Africa contributed 13.8 per cent and 9.5 per cent, respectively.
Its total headcount stood at 8,567 people at the end of June, 2017.
Kishore said the company has hired 300 people in this quarter in key geographies like the US, the UK and South Africa. "This year, our hiring will be more focused towards onsite hiring," he added.
The company will roll out wage hikes with effect from July 1. Employees in India would get an average raise of seven per cent, while onsite employees will receive 2-3 per cent increase in wages.

The financial results of the company were announced after the markets closed for the day. Shares of Zensar closed at Rs 811.75 apiece, up 2.17 per cent on BSE.