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April 30, 2009

Syntel Q1 net income up

Applications outsourcing accounted for 70% of total revenue

By CBR Staff Writer

Syntel, a provider of IT services and knowledge process outsourcing firm, has reported a net income of $27.3m, or $0.66 per diluted share, for the first quarter, ended March 31, 2009, compared to a net income of $20.4m, or $0.49 per diluted share, for the same period in 2008.

Syntel’s revenue for the first quarter of 2009 decreased 2% to $96.4 million, compared to $98.5m in the same period of 2008.

The company’s gross margin was 46.5% in the first quarter of 2009, compared to 40.3% for the same period in 2008.

According to the company, during the first quarter of 2009, applications outsourcing accounted for 70% of total revenue, with knowledge process outsourcing (KPO) at 19%, e-business contributing 9% and Team Sourcing at 2%.

Keshav Murugesh, CEO and president of Syntel, said: We continue to see the impacts of the global recession on our client’s behaviors and as a result, Syntel’s top line growth. The combination of currency headwinds, pricing pressure and delayed decision making are impacting our revenue. Clients are focused on stabilizing their business models, adjusting their strategic plans and prioritizing initiatives going forward. This has resulted in delayed decision making with respect to many projects, and aggressively driving operational efficiency and cost reduction on others.

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