Zensar Q3 net profit dips 6% to Rs 56.5 cr, sees strong deal momentum

Mid-sized software services firm Zensar Technologies Monday reported a six per cent decline in consolidated net profit to Rs 56.51 crore during the December 2018 quarter as compared to the year-ago period.

The Pune-headquartered firm had posted net profit of Rs 60.17 crore in the October-December 2017 quarter.

The net profit was negatively impacted on two main counts -- foreign exchange losses and lower operating margins as several of the deals won are currently in transition, Zensar Technologies Chief Executive Officer and Managing Director Sandeep Kishore said.

However, the deal momentum remains strong and Zensar saw win some significant large deals in the December 2018 quarter with total contract value (TCV) booking crossing the USD 200-million mark for the first time, he added.

Its revenue from operations rose 30.5 per cent to Rs 1,035.55 crore, compared with Rs 793.76 crore in the year-ago period.

The company's board has declared an interim dividend of Re 1 per share.

Digital services contributed 44.9 per cent of the total revenue in the December 2018 quarter, growing at 35.9 per cent year-on-year.

"Our revenue momentum continued well in Q3 with 4.5 per cent sequential growth in constant currency. Ebitda margins were impacted due to transition costs on the large deals that we have won over the last 2 quarters," Zensar Technologies Chief Financial Officer Navneet Khandelwal said.

He added that the company's rigour in operations ensured strong cash generation during the quarter.

The company added a net of 331 people during the December 2018 quarter, taking the total headcount to 9,813 people.