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Follow UsMUMBAI: Decline in revenue from IT solutions and consulting services segment led software product and solutions company I Flex Solutions to report flat revenue growth for the quarter ended September 30, 2003, on a sequential basis. Moreover, its software product & related services reported marginal growth on a quarter on quarter basis. Income from operation from IT solutions and consulting services segment also declined by 50 per cent, which led to pressure on gross margins.
Consolidated basis (Rs crore)
Q2 FY03-04 | Product & related services | IT solutions and consulting services |
Revenues | 112.57 | 74.4 |
Income from operation | 49.65 | 14.68 |
Q1 FY03-04 | Product & related services | IT solutions and consulting services |
Revenues | 119.72 | 63.67 |
Income from operation | 50.08 | 7.43 |
Its gross profit remained flat at Rs 107.89 crore (Rs 107.07 crore). However, the company managed to report robust 32 per cent growth in net profit, despite flat top-line mainly on the back of other income and dip selling and marketing expenses, general and administration expenses. Other income, mainly foreign exchange gains, stood at Rs 2.13 crore, compared to a loss of Rs 7.44 crore in June, 2003. Its net profit margin improved to 25.89 per cent (20.98 per cent), mainly on account of lower cost and other income. Between the second quarter highlights, the company`s total number of customer serviced increased to 432, up from 419 in the June, 2003 quarter, as the company added 13 customers for Flexcube (9 in June 2003 quarter). During the quarter the company added 2,54 new employees and total staff strength went up to 2600 people from 2,429 in the preceding quarter. About the rupee appreciation, Deepak Ghaisas, CEO, India operations and CFO said, `The current situation relating to the weakening dollar has impacted the entire IT industry. With some good hedging mechanisms we have been able to minimize the losses significantly this quarter, but the situation remains challenging`.
I Flex (Rs crore) | Sep-03 | Jun-03 | %change | Sep-02 | %change |
Revenues | 187.03 | 183.43 | 1.96 | 146.42 | 27.74 |
Cost of revenues | 79.14 | 76.36 | 3.64 | 63.23 | 25.16 |
Gross Profit | 107.89 | 107.07 | 0.77 | 83.19 | 29.69 |
Selling & Mkt expenses | 28.17 | 30.55 | -7.79 | 19.21 | 46.64 |
Gen & Admn expenses | 20.89 | 26.72 | -21.82 | 15.39 | 35.74 |
Depreciation & amortization | 3.25 | 2.95 | 10.17 | 3.71 | -12.40 |
Income for operations | 55.58 | 46.85 | 18.63 | 44.88 | 23.84 |
Interest Income | 5.37 | 5.74 | -6.45 | 6.18 | -13.11 |
Other Income/(expense) | 2.13 | -7.44 | -128.63 | -3.89 | -154.76 |
Income before prov for tax | 63.08 | 45.15 | 39.71 | 47.17 | 33.73 |
Tax | 12.72 | 7.03 | 80.94 | 6.74 | 88.72 |
Net Income | 50.36 | 38.12 | 32.11 | 40.43 | 24.56 |
Gross Profit Margin | 57.69 | 58.37 | 56.82 | ||
Net profit margin | 25.89 | 20.98 | 27.19 |