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Tech Mahindra profit falls on dip in BT Group revenue

Tech Mahindra profit falls on dip in BT Group revenue
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First Published: Wed, Nov 16 2011. 01 02 AM IST

Tech Mahindra chairman Anand Mahindra. (File photo)
Tech Mahindra chairman Anand Mahindra. (File photo)
Updated: Wed, Nov 16 2011. 01 02 AM IST
Mumbai: Tech Mahindra Ltd. on Tuesday reported a 13% fall in net profit for the three months ended September from a quarter earlier due to a dip in revenue from largest client BT Group Plc, and a currency translation loss even as the euro zone crisis has frozen discretionary spending among clients.
Tech Mahindra chairman Anand Mahindra. (File photo)
Consolidated net profit for the July-September period dropped to Rs 240.44 crore from Rs 276.50 crore in the trailing quarter, even as revenue rose 3.2% to Rs1,333.29 crore.
Revenue from BT Group, which owns a 23.23% stake in Tech Mahindra according to data on the Bombay Stock Exchange, has steadily decreased over the years as a part of total revenue. It now contributies 37% to total revenue as compared to 40% in the trailing quarter. On an absolute basis, revenue from BT Group fell 4.9% quarter-on-quarter.
“We continue to be BT’s largest partner and expect to gain market share and revenue as and when BT embarks on expansion initiatives,” chief executive officer Vineet Nayyar said, adding that he was confident of growth in the non-BT business.
Non-BT revenue grew 6.9% sequentially even as revenue from both the Americas and the rest of the world rose, while that from Europe fell.
Earnings before interest, taxes, depreciation and amortisation margins fell by 300 basis points to 15.3% due to the impact of higher wages during the quarter and loss of revenue from BT Group.
The company also reported a Rs52.23 crore loss on a foreign currency loan due to currency movements. The Indian rupee lost 6.14% to the British pound in the July-September period, and 8.73% to the US dollar.
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First Published: Wed, Nov 16 2011. 01 02 AM IST