Financial Daily from THE HINDU group of publications
Tuesday, Jul 23, 2002
Corporate Results - Software
Infotech Enterprises Q1 net profit up
HYDERABAD, July 22
INFOTECH Enterprises Ltd has recorded a total income of Rs 29.60 crore and a net profit of Rs 6.32 crore for the quarter ended June 30, 2002 as against total income of Rs 21.12 crore and a net profit of Rs 3.84 crore for the corresponding quarter last year.
This reflects an increase of 40.2 per cent in income and 64.6 per cent in net profit.
The company, which recorded total income of Rs 100.47 crore and a net profit of Rs 25.63 crore for the year ended March 31, 2002, has projected consolidated revenues of Rs 175 crore during 2002-03.
The Chairman and Managing Director, Mr B.V.R. Mohan Reddy, said following strong expansion in financial year 2002, Infotech's operations have entered a phase of value-based transition.
Strong business expansion continued in the engineering business during the first quarter of financial year 2003 that resulted in robust growth, mainly through increasing efficiencies in existing resource utilisation.
``Our engagement with Pratt and Whitney continued to progress and is now the core of our engineering services business. We are confident in our ability to leverage this relationship further across the other constituent companies of the United Technologies Group ,'' Mr Reddy said.
Compared to June 30, 2001, the non-promoter shareholding has gone up primarily due to allotment of 10,80,010 equity shares to United Technologies Corporation acting through Carrier International Mauritius Ltd on behalf of Pratt and Whitney division in February 2002.
While the Indian operations are expected to show progress on financial parameters during the financial year 2003, the group financials will be impacted in the near term by the continuing investments in the overseas subsidiaries. The incidence of tax and higher depreciation will also impact profitability, the company maintained.
During the quarter, the company initiated a brand building exercise, repaid Rs 7.5 crore, which is a major portion of its term loan, and added 14 new customers.
`Working for integration of arms'
INFOTECH Enterprises Ltd, the Hyderabad based GIS solutions provider, will continue to integrate the parent with its subsidiaries and the losses incurred in these subsidiaries need to be viewed from the perspective of investment of future, its Chairman and Managing Director Mr B.V.R. Mohan Reddy, said.
These costs were spent on recruiting high calibre people and infrastructure which will start bearing fruit for us in the coming quarters, Mr Reddy told the company shareholders while addressing its annual general meeting here on Monday.
Mr Reddy said that the company has made significant progress in ensuring that several initiatives are in place that will ensure sustained long term growth.
United Technologies, a Dow-30 company and a world leader in aircraft engines and helicopters is a valued customer and a strategic investor in the company. Infotech Enterprises, which began basic engineering services to Pratt and Whitney, has now scaled up operations to cover complex support functions for engineering solutions. This association has been further built on to other group companies including Otis Elevator, Carrier Corporation, Sikorsky Aircraft and Hamilton Sunstrand.
The company has added associates both in sales and in operations while consolidating the top management team. Last year also saw Infotech completing the acquisition of Advanced Graphic Software (AGS) in Germany and the UK-based Mapcentric, a software products distributor in Europe. AGS and Mapcentric along with London-based Infotech Enterprises Europe have given Infotech an instant market presence in Europe and existing customer base for new business.
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