Genpact Q3 profit down 47% to $25 mn

BPO major Genpact today reported 47.5% decline in net profit to $25.2 million for the third quarter ended September 30, impacted by "foreign exchange re-measurement loss and expenses related to special cash dividend".

This is against a net income of $48 million in the same quarter of 2011. The company follows January-December as its financial year.

"Third quarter 2012 net income and margin reflected the impact of a foreign exchange re-measurement loss as well as expenses related to: the special cash dividend; associated debt refinancing and withholding taxes; and the sale of shares by Genpact's original sponsors," it said.

Net income margin for the reported quarter was 5.1% compared to 11.2% in the third quarter of 2011, Genpact said in a statement.

Genpact's revenues were at $491.2 million, up 14.3% from $429.6 million in July-September 2011, it added.

"We returned capital to shareholders in the third quarter in the form of a special cash dividend of $2.24 per share, and facilitated the sale of shares by our original sponsors. We believe both of these events are extremely positive for shareholders," Genpact President and CEO N V Tyagarajan said.

Like clients, Genpact remains cautious about the global economy in the near term and thus continues to expect full-year revenues of $1.86-$1.90 billion, and adjusted operating income margin of 16-16.5% in 2012, he added.

Revenues from Global Clients grew 19.3% over the third quarter of 2011, which represents about 74.5% of Genpact's total revenues.

The remaining 25.5% of revenues (or $125.3 million) came from GE, up 1.9% from the Q3 of 2011.

About 76.1% of Genpact's revenues for the quarter came from business process management services, while that from IT services was about 23.9%.

Genpact had about $394.5 million in cash and cash equivalents as of September 30, 2012. During the period it had about 60,800 employees worldwide from approximately 53,600 as of September 30, 2011.

The attrition rate for the nine months ended September 30 was 25%, measured from day one of employment, down from 30% for the same period in 2011.