The Hindu Business Line : VisualSoft income, net drop on biz revamp

VISUALSOFT Technologies Ltd has recorded lower income of Rs 28.77 crore and a net profit of Rs 4.04 crore for the third quarter ended December 31, 2005, against total income of Rs 48.06 crore and a net profit of Rs 6.88 crore for the corresponding quarter last year.

This reflects a significant drop in both revenues and net profit which the company management explained was due to the restructuring it had undertaken following the announcement of merger of two independent new entities of AppLabs Technologies and eSolutions Private Ltd with VisualSoft.

The Chief Financial Officer, VisualSoft, Mr V. Krishnan told Business Line, "The company has decided to restructure its operations, consolidate business along two main streams of testing and product services. This consolidation and merger process would be completed once the court approval is received."

Following the restructuring process, as opposed to total revenues of Rs 192.87 crore and a net profit of Rs 28.33 crore for fiscal 2004-2005, the revenues and net are likely to be lower this fiscal. However, if you take the consolidated revenues of combined entities, VisualSoft total revenues were at Rs 55.08 crore with a net profit of Rs 7.57 crore. The consolidated numbers would be reflected next fiscal after the court approval.

During the fourth quarter, the company expects to acquire a US-based company engaged in testing domain. To part fund this move, VisualSoft plans to raise Rs 90 crore through foreign currency loan or rupee term loan.

Vizag land sale: The board of directors, who met here, decided to sell 106 acres they had acquired at Visakhapatnam and deploy the funds they garner for its overseas acquisition plan.

The company had acquired this land to develop a facility to host BPO operations. However, the company is weighing the option of the exiting BPO operations, he said.

VisualSoft shares ended the day lower at Rs 227.30 at the NSE against the previous close of Rs 232.35.

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