Polaris Financial Technology has reported a 29 per cent drop in net profit to Rs 43 crore for the first quarter ended June 30 as against Rs 61 crore in the corresponding quarter last year. Revenue increased marginally to Rs 584 crore (Rs 582 crore).
The drop in net profit was due to foreign exchange fluctuations, cost increase and a marginal wage hike , said Nat Narayanasamy, Group CFO, Polaris, a Chennai-based information technology company. During the quarter, the forex impact on hedge accounting was Rs 16 crore as against Rs 12 crore in the corresponding quarter last year.
Also, other income dropped to Rs 15 crore (Rs 22 crore) affecting the profitability, he said.
Arun Jain, Founder, Chairman and CEO, said the company is in the midst of an organisational restructure.It has been a challenge to manage the change, along with the agenda for growth,investment and profitability. The team has still driven some growth in top line and EBITDA margins, while managing the structural change smoothly.
Narayanasamy said that focus on operational efficiencies resulted in the days selling outstanding coming down to 59 compared with 75 days in the same quarter last year.
The company’s cash position at the end of June quarter was at Rs 571 crore (Rs 329 crore). The company’s stock price on the BSE closed at Rs 105.05, down by Rs 4.45 over the previous day’s closing price.