Income from operations has grown 70.89 per cent to Rs 69.91 crore. Total expenditure as a percentage of revenues has, however, declined from 76.48 per cent to 64.71 per cent. As a result, operating profit has risen 156.44 per cent to Rs 24.67 crore and operating margins have improved from 23.52 per cent to 35.29 per cent. Interest outgo has risen three-fold to Rs 4.12 crore as a result of which the rise in cash profit has been lower than the operating profit growth.

While the cash profit has risen 150.12 per cent to Rs 20.81 crore, cash margins have improved from 20.31per cent to 29.66 per cent. Depreciation has grown six-fold to Rs 5.05 crore as the company has begun to depreciate computer systems over 2-4 years, in line with international practice. Profit before tax has, nevertheless, doubled to Rs 15.76 crore and pre-tax margins have improved from 18.53 per cent to 22.46 per cent.

Despite a 100 per cent growth in tax provisions, net profit has more than doubled to Rs 14.10 crore and net margins have improved from 16.55 per cent to 20.09 per cent.

Though the company may not be able to maintain its impressive return on net worth this year, it should be able to improve its margins further. Its training & education division is increasingly moving into specialised areas like process control and embedded software applications. It has tied up with IBM for conducting e-business training and has begun offering career-based training programmes in mechanical CAD and GIS. Besides, the company has also been focussing on corporate training and some of its clients include Tisco,Escorts, SmithKline Beecham and ABN Amro Bank. This division currently contributes about 40 per cent to its topline.

The systems integration business has also been doing well and the company has clinched major orders from domestic clients like BHEL, Eicher Motors & Hawkins and international clients like Ford Motor, Siemens & Eaton Corp. It has also received orders from UTI and Neptune Cyberworld for the design and implementation of LAN & internet connectivity. In 1998-99, the company sold 54 IBM AS/400 mid range servers, IBM Netfinity servers and PC products. It has received further orders from IGMINT -- the government of India and Berlington Exports for total system integration. Further, the company will use the proceeds of the recent preferential issue to repay its debt. As a result, the increasing interest outgo will cease to be a concern and cash margins should show a significant improvement.