NIIT Technologies on Tuesday posted a net loss of Rs 17.5 crore for the quarter ended March 2015, against a profit of Rs 61.9 crore in the year-ago period, due to exceptional expense of Rs 80 crore on account of dispute settlement.
“A dispute had arisen between one of the company's subsidiaries and its client in the Asia Pacific region. The dispute was resolved by concluding a settlement agreement which released the company of its obligations towards execution of the programme,” NIIT Technologies Chief Executive Officer Arvind Thakur said.
He added that the financial impact of this one off event during the quarter is Rs. 80 crore.
The mid-sized IT firm, whose consolidated revenues rose 3.9 per cent to Rs. 611.2 crore in the January-March 2015 period, also announced acquiring 51 per cent stake in Hyderabad-based Incessant Technologies for USD 17 million (about Rs. 107.8 crore).
“Incessant provides us with the capability to be a significant player in the Digital Integration space with digitization and automation of business processes for seamless customer experience,” NIIT Technologies COO Sudhir Chaturvedi said.
Mr. Thakur added that going forward the company will be focusing on digital space. Digital business currently contributes about nine per cent of NIIT Technologies' revenues.
“This acquisition is a strategic move for us to grow in the digital space. Incessant is valued at about USD 17 million and we will would be investing the same amount for 51 per cent stake,” he said, adding that NIIT Technologies will gradually go on to acquire the remaining stake in the company over a period of time.
Incessant Technologies presently has about 300 employees and 20 significant clients.
During the quarter under review, NIIT Technologies added 435 people during the quarter taking the total headcount to 8,494 at the end of March, 2015. The attrition rate stood at 15.75 per cent.
The board recommended Rs. 9.50 per equity share as dividend for FY’15. The company’s shares closed at Rs. 401.80, up 12.20 per cent from previous close on the BSE.
