BFL's president and chief executive officer BV Venkatesh said profits would rise in the remaining quarters and register an annual growth of about ``40 plus'' per cent.

``We incurred higher expenses during this quarter as we had to recruit more people to meet our targets for the full year,'' Venkatesh told Reuters on the sidelines of a news conference.

BFL, which is 52 per cent owned by Baring India Investment Ltd, a private equity fund sponsored by ING Group of The Netherlands, announced its financial results for the first quarter of 1999-2000 on Thursday.

The net profit for the first quarter fell to Rs 4.2 crore from Rs 5 crore in the same period last year.

``The net profit will, however, go up in the coming quarters and we will continue to grow at 40 plus per cent during the year,'' Venkatesh told a news conferenceafter announcing the results.

BFL's share price fell Rs 71.25 to Rs 819.55 on Thursday. The $1.5 million acquisition of Germany's healthcare products company, Complex System, will expand the customer base of BFL and also act as a launching pad to business in Europe, Venkatesh said. Payment will be made in phases over the next three years and the acquisition will be complete in the next two weeks.