Syntel Q1 Net up 25 pc at $58.1m

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IT services firm Syntel today reported a 25 per cent growth in its net profit at $ 58.1 million for the first quarter ended March 31, 2014.

The US-based firm had posted a net profit of $ 46.4 million in the year-ago period, it said in a statement.

Syntel's revenue rose by 16 per cent to $ 219.5 million in the January-March quarter from $ 189.1 million in the same period last fiscal.

Quarter-on-quarter, its revenue fell two per cent from $ 223.3 million in the fourth quarter of 2013, while net profit declined 12.4 per cent from $ 66.3 million in Q4 of 2013.

Sequential decline in operating margin primarily reflects impact of higher employee headcount and compensation expenses and currency-related balance sheet translations, it added.

Commenting on the performance, Syntel CEO and President Prashant Ranade said: "Syntel started 2014 on a solid footing and we look forward to building on this in the months ahead."

During the first quarter, banking and financial services accounted for 49 per cent of total revenue with healthcare and life sciences at 17 per cent; retail, logistics and telecom 16 per cent; insurance 15 per cent and manufacturing 3 per cent.

During Q1 2014, Syntel spent $ 3.8 million in CAPEX, largely in support of campus infrastructure and finished the quarter with cash and short-term investments of $ 712.9 million.

"I am optimistic about the future opportunities this long-term view affords us and our aim is to target investments in strategic areas that will further differentiate our service offerings," Ranade said.

The Company also added 555 net employees, ending the quarter with 24,207 employees globally.

On outlook, Syntel said: "Based on current visibility levels and an exchange rate assumption of Rs 60 to the dollar, the company currently expects 2014 revenue of $ 915-940 million and EPS in the range of $ 5.10-5.28."

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