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Pentasoft
Technologies Financial Results - for the Year 2002-03
SALIENT
FEATURES: (Year wise comparison)
The Turnover for the parent company for financial year 2002-03 is Rs.218.39 Cr.
as against Rs.371.17 Cr. for the previous f.y 2001-02.
This means a fall of 41% in
turnover when compared to the previous year. This is due to the careful evaluation
of Orders and ascertaining 20% bottom line.
Profit After Tax (PAT) for the year has decreased to Rs.2.77 Cr. as compared to
Rs.59.68 Cr. achieved during the previous year.
The Software Development Expenses incurred was higher at 53.50 % of the Total Sales
when compared to 36.18 % of the previous year, due to absorption of settlement of
employees in the overseas project site.
The Domestic Sales during the year under review was only 8.62% as against 25.5%
of the previous year.
Employee Cost has been reduced to 2.70% from 7.46% of the Previous year.
Operating margin for the current year is at 38% when compared to 46.65% of the previous
year due to sudden decrease in Overseas Orders coupled with expenses towards settlement
of staff costs.
Interest and Finance charges is increased to Rs.12.93 Cr. as compared to Rs.9.22
Cr. for the previous financial year.
Depreciation & Amortization for the year is at Rs.66.49 Cr. as compared to Rs.120.10
Cr. in the previous year, as we have depreciated obsolete and unusable software
in the previous year itself.
During the year One Time Settlement of Rs.6.69 Cr. was made to overseas employees.
Deferred Tax provision account for Rs.6.26 Cr. Compared to an Income of Rs.6.61
Cr. during the previous year.
Earning per Share (EPS) has gone down to Rs.0.46 for the current year as compared
to Rs.18.03 for the previous year, due to increase in share capital in view of Bonus
shares & lower profit.
Results for the Quarter ended March 2003
PENTASOFT SURGES FORWARD WITH
ITS NEW STRATEGIES
Chennai, June 28,2003 – Pentasoft Technologies Limited, today announced its audited
results approved by the Board of Directors for the Quarter ended March 2003.
HIGHLIGHTS:-
STRATEGIES IN PLACE:
1.
Acceptance of orders after careful evaluation and ascertaining bottom line of minimum
20%
2. Revamping divisions within organization.
3. Total cost control adopting different austerity measures through out the business
cycle.
4. Identification of business, which will provide regular income stream to take care
of operational expenses on monthly basis.
5. Tie-up with groups, which have similar ideologies for future growth.
With the above, our Company has been successful in sustaining the operation level
and aim for a better growth in the days ahead.
Profit after tax of the parent company during the fourth
quarter is lower at Rs.1.79 crores compared to Rs.5.42 Crores for the previous quarter.
Because of increase in Share Capital by Rs 9.86 Crores
in view of Bonus Shares @ 2:10, the Earning Per Share was at 0.30 compared to 0.92
in the previous quarter.
Operating Margin is maintained at 44% compared to third
quarter of the year though we have absorbed costs towards one time settlement of
employees
Consolidated turn over of Rs.42.05 Crores against third
quarter Rs.68.68 Crores is due to the fact of leaving out orders, which gives less
than 20% net margin.
5 new customers added in the Global IT services during
the period.
Entry into BPO sector in the Finance and Maintenance
areas and also planning for acquisition of companies in these areas in the short
term.
Mr.D.Kannan, Director & CEO on the occasion of the results stated.......
The outcome
of the 4th quarter results directly reflects the strategies adopted by
the Company viz.,
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To focus
on select niche market segments.
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To capitalize
on the marketing efforts put in at select overseas operations.
-
To qualify
accounts based on 20% net margin criteria
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To constantly
review the cost control measures to reduce the overhead / marketing cost thereby
improving the bottom line.
Our continued
efforts on the development of Insurance Products has been successful and currently
the Company has suite of insurance products catering to the complete requirements
of Life, General and Islamic Insurance.
This product matches with any other international competing products in the Insurance
segments.
The Hong
Leong project in Malaysia is in the final implementation phase and is proceeding
as per the schedule and this becomes major reference point for our future identified
prospectus in the Asia Pacific segments.
A major
break through achieved in this quarter include the completion of initial phases
of Consortium Partnership agreement with a major US Company providing its services
in the areas of Electrical Design Automation, Mechanical Design Automation, Knowledge
Based Engineering, Manufacturing Design Automation and e-Engineering Design Automation.
Also, the Company explores the possibilities into the new areas of X BY-WIRE technology
as well as Systems Engineering implementation.
Pentasoft
has identified the niche area viz., KEY COMPONENT MANUFACTURER programme to Automobile
manufacturers for the USA, UK and Southeastern countries through association with
established automobile component manufacturers in India and / or from other Far
East countries. The programme adopts
in suitable methodologies for selected products going through the full cycle viz.,
conceptualization, consumption design, detailing, manufacturing, quality and supply
of selective components. The main objective
will be to become the pioneer to the concept of Total Solution Provider – which
incidentally takes care of A to Z of the entire process cycle and the outcome will
produce high quality products at competitive rates to the satisfaction of customers.
Signed-up
with a major Western Australian University to offer degree programmes out of the
proposed IT Park Technology Development in Mauritius.
The initial efforts of setting up of master franchisees in African continent
have been taken up in this quarter.
BPO services
started with Associate partners in the areas of customer services, content development.
Financial Overview
Pentasoft Technologies Limited recorded a consolidated turnover of Rs.42.05 Crores
for the fourth Quarter ended 31st March 2003 as against Rs.68.68 Crores for the
quarter ending 31st December 2002. The operating profit of the Company for the current
quarter is Rs.18.37 Crores as against Rs.23.04 Crores for the quarter ending 31st
December 2002. Other income during the fourth Quarter amounted to Rs.1.88 Crores.
Net profit during the current quarter amounted to Rs.2.98 Crores, as against Rs.7.16
Crores achieved during the quarter ending 31st December 2002.
During this quarter, overseas accounted for 95 %, domestic sales 5 %. Out of these
subsidiaries accounted for 30 %. In the domestic segment, Training contributed 5
%. In the export segment, Business Software Services contributed 76 %, Engineering
17% and International Learning Services 7%.
Pentasoft continues to expand its client base across the globe by having both repeat
customers as well as new customers. This quarter saw an addition of 5 new customers
to the existing customer base.
Our Global IT Business
1. Banking & Insurance:
Pentasoft has successfully
completed its project with Electronic Banking Services, Sudan and 6 Banks in Sudan
are now online using Pentabank. It had undertaken a project for enabling the finance
and administrative functions for Bank of Sudan. This project is nearing completion
and is expected to be completed shortly.
The projects in
Malaysia with Hong Leong Assurance is on schedule for completion and the relationship
has been identified with supplementary orders from Hong Leong. Other projects in
progress include Takaful Nasional and Zurich Natlife in Thailand.
Successfully, implemented Insurance solution to WanaArtha in Indonesia. Recently
demonstrated the products for select Insurance companies in Taiwan for providing
integrated Insurance solutions.
Gearing up for
Insurance software solutions for Brunei. After successful development of suite of
Insurance Products to cater Asia Pacific Regions, the Company is also actively exploring
positioning this product for US & Europe markets.
2. Engineering Services:
Pentasoft has signed an agreement to provide extensive participation in the migration
Projects from Ford Motor Company to a leading software solution provider to many
Automobile companies in Detroit, USA.
With associating a German based company, designing the Pistons for Ford Motor Company
and General Motors. Actively participating with Avon Automotive Company, USA in
all the areas of Automotive hosing design work.
3.
ERP and Internet Projects
Sudan Petroleum Corporation has awarded the contract to Pentasoft for the development
and implementing an Enterprise wide Application for their selected Petroleum departments.
The first phase of the automation project is expected to commence in July 03. Pentasoft
has successfully completed its project for Sudanese National Electronic Library,
hosted by Sudatel. The site is now online and Pentasoft is in advanced stages of
negotiations to provide ongoing maintenance support and services. Pentasoft is in
advanced stages of negotiation for providing services for development of an Internet
Search Portal for a customer in the United Kingdom. The project is expected to commence
in August 2003.
4. Education & Training Business
Last quarter had seen consolidation
completed in all the areas of operations of E & T. The growth in the operational
revenue from the previous quarters is seen at around 65% and almost 80% from the
same quarter last year. In the Domestic front, IBM and Multimedia technologies have
seen growth in terms of students joining for those courses. Tied up with Sri Krishnadevaraya
University – A.P. to conduct the final semester for their final year M.Sc. (IT)
students at their residential training facility at Kelambakkam near Chennai. Plans
of introducing new courses on niche areas such as Networking, Simulation, Artificial
Intelligence, Bio-informatics and so on.
IVTB,
Mauritius has chosen Pentasoft as the partner to run the IT schools in Mauritius
and the MOU has been signed for the same and the first order received and the execution
in progress. Opportunities coming from the Ministry of Education and Ministry of
Labour in Bahrain for the schools and colleges. Also E-learning for the all the
University students.
In the
pipeline, E & T has the opportunities in South Korea, Indonesia, Srilanka, Nigeria
and South Africa.
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