Satyam Computer Services Ltd. (NYSE:SAY) today announced the financial results for the fourth quarter and year end March 31, 2006, in a board meeting held in Hyderabad, India.
As per US GAAP consolidated financials, Satyam’s revenue for fiscal year 2005-2006 from software services stood at US$1.096 billion, and was up by 36.12 percent over 2004-2005. The annual net profit closed at US$224.5 million, a year-on-year growth of 38 percent. Earnings per share (EPS) for the year, excluding profit on sale of stake in Sify, stood at US$ 0.69 is higher than the guidance of US$0.72. The revenue guidance for fiscal year 2007 is expected to be in the range of US$1.37 to US$1.4 billion, indicating an annual growth of 25.2 percent to 27.3 percent. The EPS guidance for 2006-2007 is US$0.84
Revenue for the quarter stood at US$300.7 million, a year-on-year growth of 35.21 percent, while net profit was US$65.5 million, up by 38 percent year on year and 5.53 percent sequentially. Volume growth at 6.8 percent was the growth driver in this quarter. The revenue guidance for Q1 2006-2007 is expected to be in the range of US$310.7 to US$ 312.3 million. The EPS guidance for Q1 2006-2007 is US$0.19 – US$ 0.2
As per US GAAP, the Company recorded revenue of US$300.7 million and earnings per ADS of US$0.39, representing a sequential growth of 6.7 percent and 8.5 percent respectively.
Commenting on the results Mr. B. Ramalinga Raju, Founder and Chairman, Satyam said: “I am pleased to report that our performance exceeded the guidance in Q4. It is with a sense of great pride and joy that I report Satyam’s entry into the billion dollar club. Achieving this significant landmark has been possible by the support received from our customers and investors and the hard work of our associates.”
In Q4, Satyam made its presence felt in the ‘large deals’ category by securing long-term contracts from leading global auto majors. The integrated solution offerings coupled with Satyam’s global program management capability will make the company a strong contender in garnering a higher share of such deals in the coming days.
During 2005-2006, Satyam reported 120 new customer wins, including 12 Fortune Global 500 and Fortune US 500 corporations. Taking its competency in aerospace sector further, Satyam also bagged several prestigious orders from aircraft majors in US and India in areas of avionics testing and engineering services.
The company has also signed a multi-year engagement with the world’s largest specialty chemicals manufacturer to develop a document management system for the company.
Raju added: “As we step into the new fiscal, we believe that the demand environment will continue to remain buoyant. There is an increasing acceptance in the market towards the global delivery model. To address the available opportunities, we are strengthening our business solutions capability by hiring best associates from across the world, and are making a focused attempt at enhancing our competence in new service areas that would be the drivers of growth going forward.”
The net employee addition for the quarter was 3,079, taking the total employee strength to 26,511. The employee base is 28,624 including subsidiaries.
During 2005-2006, Nipuna recorded revenues of US$20 million. The achievement of cash break-even by Nipuna in Q4 as per expectations is encouraging and points towards enhanced profitability in 2007. Revenue guidance for 2007 stands at US$36 million, representing an annual growth rate of 80 percent.
Nipuna also successfully added one of the world’s leading research companies in its KPO vertical. The company is consistently growing its competencies in areas like healthcare, insurance, art work management, IT help desk, finance and accounts, animation, customer contact, KPO and data management areas. It has also set up a third facility in Chennai focused on animation and other verticals.
The total employee base for Nipuna stands 1,765. The company handles 25 customers and 71 processes.
About Satyam
Satyam Computer Services Ltd. (NYSE: SAY) is a global IT Consulting and Services Provider, offering a range of expertise aimed at helping customers re-engineer and re-invent their businesses to compete successfully in an ever-changing marketplace. Over 28,000* highly-skilled professionals in Satyam work onsite, offsite, offshore and nearshore, to provide customized IT solutions for companies in several industry sectors. Satyam’s ideas and products have resulted in technology-intensive transformations that have met the most stringent international quality standards. Satyam Development Centers in India, the USA, the UK, the UAE, Canada, Hungary, Malaysia, Singapore, China, Japan and Australia serve 469* global companies, of which 156* are Fortune Global 500 and Fortune US 500 corporations. Satyam’s presence spans 53 countries, across six continents.
*Figures correct as per quarter ended March 31, 2006
Satyam Contact
For further information please contact: a.dale@polaris-me.com
Safe Harbor
This press release contains forward-looking statements within the meaning of section 27A of Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Satyam undertakes no duty to update any forward-looking statements. For a discussion of the risks associated with our business, please see the discussions under the heading “Risk Factors” in our report on Form 6K concerning the fiscal quarter ended Dec. 31, 2005, furnished to the United States Securities Exchange Commission on January 27, 2006, and the other reports filed with the Securities Exchange Commission from time to time. These filings are available at http://www.sec.gov.
