iGate posts Q3 net profit of $14.3 million

Nasdaq-listed iGate on Friday said its net profit stood at $14.3 million for the quarter ended September 2011, a flat performance year-on-year on account of high interest costs.

The company's net profit stood at $14.3 million in the third quarter of 2010, though sequentially, it has more than trebled from $4 million. Interest expenses impacted the software firm's net income by $19.5 million.

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iGate's revenues jumped more than three-fold to $265.7 million in Q3 2011, compared to $74.8 million in the quarter ended September 30, 2010.

Sequentially, revenues for the third quarter of 2011 were up 56 per cent in comparison to $170.4 million in the quarter ended June 30, 2011.

The numbers include the financials of Indian IT firm Patni Computer Systems, in which the US-based firm acquired a majority stake in January this year for $1.2 billion in one of the largest deals in the Indian IT sector.

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"With Phases 1 and 2 of integration (of iGate and Patni) largely done, I'm pleased with the positive results in the combined company. We still have a ways to go to fix our new sales engine, but overall, we are making good progress," iGate Patni Chief Executive Officer Phaneesh Murthy told reporters in a conference call.

On clients' IT budgets for 2012, Murthy said while it could decline for some verticals, it would also go up for certain businesses.

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"We sense that the IT budgets may be marginally up for some verticals like media and entertainment, healthcare and flat to marginally down for others like banking and financial services," he said.

The company expects to hire 4,000-5,000 people in 2012.

"The attrition level was about 20 per cent. Now that the consolidation has been completed and there is stability, the attrition rate has come down and we expect it to go down further to about 15 per cent in the next few quarters," Murthy said.

Asked about delisting of Patni from the Indian bourses, Murthy said no decision has yet been taken.