MindTree net profit dips by 26% to Rs 103 cr on poor global business

Magnet360 in US and Bluefin in Europe operated at a margin much lower than MindTree's organic margin

Mid-tier IT services company MindTree saw profits drop by 26 per cent to Rs 103 crore due to poor performance of its US and Europe subsidiaries, while revenue grew 7 per cent to Rs 1,295 crore on the back of strong deal wins.

The Bengaluru-based company posted profits of Rs 140 crore on a revenue of Rs 1,209 crore in the October to December period last year.

"The year-on-year decline in net profit can be contributed partly to currency fluctuations and partly to poor performance of our international business. The companies that we acquired — Magnet360 in the US and Bluefin in Europe — operated at a margin historically lower than MindTree's organic margin," said Rostow Ravanan, chief executive officer and managing director, MindTree.

Ravanan continued to be cautious in the macroeconomic environment at least for the next few quarters.

In dollar terms, the company reported 4.7 per cent year-on-year growth in revenue to $192.2 million. During the quarter, one of the company's clients doubled its billing, resulting in first client in the $100 million category. Overall, MindTree added $300 million worth contracts in the third quarter.