Syntel (SYNT), the provider of information technology (IT) and knowledge process outsourcing (KPO) services worldwide, has reported a 25.25 percent rise in profit for the quarter ended Mar. 31, 2014, helped by healthy revenues and expansion in operating margin.
The company earned $58.15 million or $1.39 a share in the first-quarter, compared with $46.42 million or $1.11 a share a year ago. Analysts on an average had expected earnings per share at $1.26.
Revenue during the first-quarter grew 16.08 percent to $219.52 million from $189.11 million in the last year period.
Gross margin expanded by 261 basis points over the last year period to 43.74 percent. Total expenses as a percentage of revenues decreased to 70.94 percent from 72.46 percent in the same period last year. That resulted in improvement of 152 basis points in operating margin to 29.06 percent.
The company posted operating income of $63.80 million, compared with an operating income of $52.08 million in the previous year period.
As on Mar. 31, 2014, Syntel's cash balance stood at $221.84 million, up 69.09 percent or $90.64 million from Mar. 31, 2013.
During first quarter, Syntel spent $3.8 million in CAPEX, largely in support of campus infrastructure, and finished the quarter with cash and short-term investments of $712.9 million. The company also added 555 net employees, ending the quarter with 24,207 employees globally.
"Syntel started 2014 on a solid footing and we look forward to building on this in the months ahead," said Prashant Ranade, chief executive officer and president, Syntel. "Our focus on our core strengths has never wavered and our customers rely on our consistency to manage through the constant change they face in their businesses."
"We have built our company around serving the needs of our customers; this is evident in the depth of our domain expertise and our commitment to providing high value solutions tied to their evolving businesses," said Ranade.
"Our commitment to our clients' long-term success guides many of our investments as we collaborate to achieve mutual success," he said. "I am optimistic about the future opportunities this long-term view affords us and our aim is to target investments in strategic areas that will further differentiate our service offerings."
Based on current visibility levels and an exchange rate assumption of 60 Indian rupees to the dollar, the company currently expects 2014 revenue of $915 to $940 million and EPS in the range of $5.10 to $5.28.
Shares of Syntel fell $1.33 or 1.56 percent to close at $83.79 on Thursday.
