BackNIIT Tech Dec-qtr profit swells, margins drop
NIIT Tech Dec-qtr profit swells, margins drop
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Mumbai: NIIT Technologies Ltd, which provides software services, on Tuesday posted a 35% jump in its December-quarter profit, but margins were compressed due to higher expenses in providing infrastructure for a major turnkey contract.
During the quarter, the company serviced a major turnkey contract for the Border Security Force involving the delivery of Rs148 million of bought-outs.
Bought-outs refer to hardware supplied by the company, which are not produced by it, hurting margins as a result.
Operating margins dropped to 20.7% from 22% a year ago.
“We will have less bought-outs next quarter, so margins will improve next quarter onwards," chief executive Arvind Thakur said.
For the December-quarter, NIIT Technologies posted a consolidated net profit of Rs478 million compared with Rs353 million a year ago. Revenue jumped 30.6% to Rs300 crore.
NIIT Technologies was spun off from NIIT Ltd, an Indian talent development firm, in 2004. The latter still owns about a quarter of the spun-off firm.
NIIT Technologies, which has a 12-month order backlog of $137 million, said it secured fresh orders of $50 million during the quarter, including the addition of four significant new customers.
It added 364 employees during the quarter taking its headcount to 5358 at the end of the December quarter.
Shares of the company closed up 2.04% at Rs209.60.
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