Hexaware Q3 net beats forecast; sees 2011 revenue rise

Hexaware Q3 net beats forecast; sees 2011 revenue rise

Mumbai: Software services firm Hexaware Technologies Ltd reported a better-than-expected 10% rise in October-December net profit and forecast 2011 revenue to grow by a quarter, sending its shares up by more than 5%.

The firm, which had revenues of $231 million in the year-ended December 2010, sees 2011 revenues at a minimum $290 million on the back of strong growth in the last three quarters, chairman Atul Nishar said in a statement.

Shares in the firm rose as much as 5.6% to Rs113.4 in a flat Mumbai market.

“This has been a remarkably strong quarter on all fronts," said P.R. chief executive officer, referring to a rise in operating profit margin and healthy bill rates.

The firm’s operating margins rose 300 basis points sequentially to 11.5% in the December quarter. It added 11 new clients in the period, it said in a statement to the stock exchanges.

In the quarter to December, it posted a net profit of Rs396 million compared with Rs360.4 million a year ago while income from operations grew nearly 19% to about Rs300 crore.

A Reuters poll of 21 brokerages had estimated a 20% drop in October-December net profit to Rs287.2 million.

“Through the year 2010, we have continued to make investments in strengthening our vertical capabilities and enhancing our technology wherewithal," Chandrasekar said, adding the firm plans to recruit 1,500 more employees in 2011 to meet its growth plan.

The firm plans to enhance its focus on mining its 50 high potential existing clients, which generate in excess of $1 million revenues per annum to drive growth in 2011, it said.

It has forward contracts worth $130 million at an average of Rs48.25 and hedges worth €15.8 million at an average exchange rate of Rs72.13 maturing over the course of eight quarters till December 2012, it said.

At 9.56 am, shares were up 3.9% at Rs111.55 in a flat Mumbai market.