SSI Profit Plunges 82.5% In 01-02

Chennai, Aug 30: | Updated: Aug 31 2002, 05:30am hrs
Chennai-based SSI Ltd has reported a 82.53 per cent decline in net profit to Rs 9.75 crore for the financial year ended June 2002, as against a profit of Rs 55.81 crore during the corresponding period last year.

Total revenues for the period was Rs 264.28 crore (Rs 410.52 crore), a fall of 55.33 per cent.

The year has been very challenging. The training and the software services were significantly impacted by the IT slowdown. This has stabilised. We expect to post a growth of 25 per cent to 30 per cent in IT services and are aiming to reach double digit growth in software education, said Mr Kalpathi S Suresh, chairman and chief executive officer, SSI Ltd.

For the year, education contributed Rs 121.50 crore (Rs 230.78 crore) and software services Rs 142.78 crore (Rs 162.65 crore).

In the software education market, the company will increase it focus on the institutional segment. Currently, this segment constitutes less than 10 per cent of the revenues.

The retail market is greatly influenced by job prospects in the industry and the downrturn has resulted in enrollments falling. The number of employees has been reduced to 609 in the fourth quarter, as against 793 in the previous quarter.

In the software services business, the company has added six new clients and these include IDN UK, Agrilliance and Wasau Paper. It has an order pipeline of $50 million to be executed over the next 24 months.

About a third of the software services is executed offshore and the rest onsite. The current staff strength stands at 761 employees.

On a consolidated basis (including subsidiaries), the company has posted total revenues of Rs 338.32 crore and a net loss of Rs 42.39 crore. For the fourth quarter ended June 2002, on a stand alone basis SSI Ltd has posted a net profit of Rs 1.18 crore as against a loss of Rs 14.47 crore during the corresponding period last year. Total revenues was at Rs 58.39 crore (Rs 89.84 crore).

The net cash available to the firm currently stands at Rs 21.10 crore, as against Rs 65.20 crore during the previous quarter.

The cash expenditure has been in building an offshore development center in Channai for which Rs 85 crore has been spent and an additional investment of Rs 25 crore would be required. Also, working capital increases for the US arm has lead to lower net cash balance.

The company is also looking at acquisitions in software services niche to gain critical mass. It is also looking at making strategic investments in the business process outsourcing space and other technology areas, Mr Suresh said.