Satyam Computer Q2 Net Dips 12% To Rs 118 Crore

Hyderabad, October 23: | Updated: Oct 24 2002, 05:30am hrs
Satyam Computer Services Ltd has reported a 12 per cent decline in its net profit to Rs 118.15 crore (Rs 134.08 crore) despite 11 per cent growth in revenues for the second quarter ended September 30, 2002. The total income for the period was Rs 505.05 crore (Rs 453.50 crore). The decline is being attributed to a sharp fall in other income to Rs 5.91 crore (Rs 26.87 crore) in Q2.

However, on a sequential quarter basis, the performance looks better with the bottomline growing by nine per cent and the topline by seven per cent. The board has recommended an interim dividend of 40 per cent on par value of Rs 2 per share.

For the half-year ended September 30, net profit declined to Rs 226.60 crore as against Rs 255.54 crore during the same period previous year. However, the total income shot up at Rs 976.53 crore (Rs 874.52 crore).

The software revenues during the second quarter increased to Rs 499.13 crore as against Rs 426.63 crore in the corresponding period of the previous year, witnessing a growth of 16.99 per cent.

While the operating margins have improved from 30.89 per cent to 31.23 per cent in the second quarter, the EPS (basic) came down to Rs 3.76 as against Rs 4.26 during the same period last year. The EPS includes 0.46 per share gain on sale of stake in Satyam GE joint venture to GE, which was lower than the earnings guidance. The company has revised downwards the annual EPS to between Rs 16.06 and Rs 16.26 from the earlier guidance level of Rs 17.10 to Rs 17.50.

Later addressing the press conference, Satyams chairman B Ramalinga Raju said: This is the first time in Satyams history that the quarterly revenue has breached the Rs 500-crore mark. The revenue guidance for the whole year will also be maintained at 18 to 20 per cent growth in US dollar terms between Rs 2,080 crore and Rs 2,116 crore.

The sharp decline in the net profit was due to the stronger rupee compared to the dollar during the last few months, which cost the company Rs 15 crore in other income and interest receipts, he said.

According to him, Satyam has benefited from the growing trend towards outsourcing even as the global IT service companies are affected by the challenging market scenario. In my opinion, this trend is likely to continue and gain momentum, he said further.

Meanwhile, the company has projected an income from software services of anywhere between Rs 525 crore and Rs 540 crore and the operating margin of around 32 per cent for the third quarter ended December 23, 2002.