iGATE Corp has posted a 44 per cent rise in net profit at $34.8 million for first quarter ended March 31, compared with $24.1 million recorded during the same period a year ago.
The Nasdaq-listed company’s revenues rose by 4 per cent to $274.9 million during the quarter under review, compared with $263.3 million in the same quarter of last year. The company’s gross margins were at 38.1 per cent (40.2 per cent in year ago quarter).
The gross margins were impacted due to the visa costs, which are largely absorbed in second quarter, iGATE Chief Executive Officer Phaneesh Murthy said, adding, “large chunk of visa costs were absorbed during the quarter”.
The IT services company added 10 new customers during the quarter, of which six are Fortune 1000 companies, while it ended the quarter with 28,204 employees.
“We are starting to see earlier signs of larger deals coming into the pipeline… If they come back, obviously growth rates will start to accelerate,” Murthy added.
The company’s current deal pipeline is at about $3.5 billion, while the company is also pursuing large deals. The discretionary spend in the industry is also rising on adoption of social media, mobility, and analytics, iGATE Chief Financial Officer Sujit Sircar said.
iGATE has about $1.1 billion in debt, and cash on hands of about $600 million.
Patni amalgamation
Last month, Sircar told Business Line that the amalgamation of Patni Computer Systems with the company is nearing completion. With court approvals in India pending, the merger of Indian entities – iGATE India and Patni India – is expected to be completed sometime this year.
In May 2011, the iGATE acquired a stake in Patni, a company listed on the Indian bourses, for about $1.22 billion (Rs 5,560 crore).