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IGATE Q1 Profit Beats Estimates - Update

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4/13/2012 9:39 AM ET

Information technology company iGATE Corp. (IGTE: Quote), operating under the brand name iGATE Patni, reported Friday a higher first-quarter profit, reflecting a surge in revenues, despite a slight decline in margins. Adjusted earnings, excluding items, surpassed analysts' expectations, while revenues came below their view.

Phaneesh Murthy, CEO of the company said, "The long tail rationalization of our customers that we undertook yielded us higher profits but dipped revenues and the delays in project kick-offs resulted in lesser revenue growth. We expect our revenue growth to be back on track over the next couple of quarters creating a back loaded year."

iGATE Patni added seven new customers during the quarter.

After acquiring a majority stake in Patni Computer Systems Ltd., iGATE accepted delisting offer of Patni, enabling it to proceed with delisting from the Indian stock exchanges at Rs. 520/- per share. It was in January 2011 that iGATE agreed to acquire an 83 percent stake in IT services and BPO company Patni Computer Systems for $1.22 billion.

Sujit Sircar, CFO stated, "The successful delisting of Patni will be an important step towards our vision of 'one company' and will set us up well for a possible downstream merger while also reducing costs of Compliance and Governance."

In the first quarter, net income attributable to iGATE shareholders increased to $16.98 million from $15.2 million in the previous year. On a per share basis, earnings were $0.22, unchanged from last year.

Adjusted earnings increased to $0.38 from $0.23 per share reported a year earlier. On average, six analysts polled by Thomson Reuters expected the company to earn $0.32 per share. Analysts' estimates typically exclude special items.

Revenues for the quarter surged 247.4 percent to $263.27 million from $75.8 million in the same quarter last year, but was below analysts' estimate of $270.27 million.

Gross margin was 40.2 percent, compared to 40.9 percent in the preceding year.

IGTE is currently trading at $18.06, up $0.89 or 5.16 percent, on a volume of 38 thousand shares.

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by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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Chipmaker Advanced Micro Devices Inc. said Thursday after the markets closed that its first quarter loss narrowed from last year, helped by strong revenue growth in its graphics and visual solutions business. The company's quarterly earnings per share, excluding items, also came in above analysts' expectations as did its quarterly revenue. After trending higher over the past few sessions, stocks showed a lack of direction throughout the trading day on Thursday. The major averages spent the session bouncing back and forth across the unchanged line before ending the day mixed. While the major averages closed on opposite sides of the unchanged line, they all showed only modest moves. U.S. Secretary Of State John Kerry said Thursday that he and his counterparts from Russia, Ukraine and the European Union have reached an agreement on a preliminary plan for ending the ongoing crisis in Ukraine. Kerry was speaking at the end of the Ukraine contact group's first meeting, comprising the foreign ministers of Russia, Ukraine, the EU and the U.S., in the Swiss city of Geneva.
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