Cognizant sees revenues beating guidance

NEW YORK: Indo-American software services company Cognizant Technology

Solutions Corp. said on Wednesday it expects second-quarter revenues well in

excess of 10 per cent over first-quarter levels.

"Business (is) tracking quite nicely. We will substantially outperform

current guidance in terms of revenue," chief financial officer Gordon

Coburn told money managers at a Bear Stearns conference here.

The Cognizant executive said that operating profit margins as a percentage of

sales were holding up at recent levels of around 19 per cent to 20 per cent.

"We now expect revenue will grow at least 10 per cent," Coburn said,

adding, "And, I emphasize, in excess of 10 per cent growth."

Teaneck, New Jersey-based Cognizant reported first-quarter revenue of $46.5

million. A 10 per cent rise would bring its revenue to more than $51 million.

Its previous guidance was for second-quarter revenue of at least $49.5 million.

Coburn also reiterated the company's guidance for full-year earnings of

"at least $1.50 per share" and more than $200 million in revenue. Wall

Street analysts currently estimate the company will report full-year earnings of

$1.50 to $1.55 share, with a mean of $1.51.

"We are really confident for the year," he said. "How much? We

will have to wait and see how much the Indian-Pakistan issue has affected

us."

Cognizant, a spin-off of Dun & Bradstreet in 1998, is one of a small

group of publicly traded software services firms that are benefiting from an

explosion of interest in offshore software development in India. The practice

has become mainstream among many of the world's largest companies in the face of

a weak economy and tight corporate spending.

Shares of Cognizant edged up 6 cents to $44.56 Late Wednesday on the Nasdaq

market.

(C) Reuters Limited.