iGate Patni reports flattish net income for Q3 2011

iGate Corporation, the Nasdaq-listed company, which earlier in the year acquired Patni Computers, reported flattish net income of $14.3 million for the third-quarter of 2011, the same as in Q3 of 2010.

Combined revenues for Q3 added up to $265.7 million ($74.8 million in Q3 of 2010), while gross margin was down at 36.9 per cent (39.4 per cent previous year's Q3). The company claimed that a successful integration exercise with Patni Computers had yielded positive results.

''With phases one and two of integration largely done, I am pleased with the positive results in the combined company,'' noted Phaneesh Murthy, CEO, iGate Patni. ''We still have a ways to go to fix our new sales engine, but overall we are making good progress.''

Referring to 2012, Murthy said IT budgets ''may be marginally up for some verticals and flat to marginally down for others.'' 

According to Sujit Sircar, chief financial officer, iGate, the clear uptick in its third quarter operating margins is testimony to the success of its integration efforts and the fact that the combined entity was moving in the right direction. ''With the progress made, we feel confident of our goal of 40 per cent in gross margins and 25 per cent in EBITDA (earnings before interest, taxes, depreciation and amortisation) over the coming quarters.''

According to the company, there has been a spurt in adjusted EBITDA (up at $55.8 million for Q3 2011, as against $19.2 million in Q3 of the previous fiscal) and EPS (earnings per share) with increased revenues, while the attrition percentage has further decreased to less than 20 per cent, with the combined entity showing clear signs of the integration efforts being effective.