DGAP-News: iGATE Reports Q2 Revenues; Revenues Up 57.3%
(firmenpresse) - iGATE Corporation
13.07.2012 13:00
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Corporate Structure and Brand Simplified After Patni Delisting
FREMONT, Calif., 2012-07-13 13:00 CEST (GLOBE NEWSWIRE) --
iGATE Corporation (Nasdaq:IGTE), the first integrated Technology and Operations
Company providing Business Outcomes-business based solutions, today announced
its financial results for the second quarter and six months ended June 30,
2012.
Second Quarter Highlights
-- Successfully completed delisting of Patni Computer Systems Ltd and launched
single go-to-market brand, 'iGATE,' in line with the vision of 'one
company'
-- Net income for the second quarter of 2012 increased by 217.5% to $12.7
million from $4.0 million in the second quarter of 2011
-- Revenues for the second quarter of 2012 increased by 57.3% to $268.0
million from $170.4 million in the second quarter of 2011
-- Gross margin was 37.4% for the second quarter of 2012 compared to 34.7% in
the corresponding quarter of 2011
-- Diluted earnings per share of $0.07 GAAP; $0.28 non-GAAP
-- iGATE added 17 new customers during the quarter
-- The company ended the second quarter of 2012 with 27,417 employees
Phaneesh Murthy, CEO, iGATE said, 'It has been satisfying to see growth coming
back in a very volatile market. I am particularly happy with the pedigree of
the new clients we have added in the quarter with seven of them being Fortune
1000 companies. This clearly shows the increased acceptance of our
differentiated outcomes-based proposition.'
On key events, Mr. Murthy said, 'I am happy that we have filled our North
American Sales Leadership position. It is my pleasure to welcome Sanjay Tugnait
to this role.'
Sujit Sircar, CFO, iGATE said, 'I am very pleased that we were able to smoothly
accomplish the delisting process of Patni with our ownership of Patni shares
now rising to 96.9%. While the rupee fluctuation is a concern due to forex
headwinds, I am confident that we are well placed for a steady growth in
revenues and margins. '
Second Quarter Operating Results
Results for the second quarter on a GAAP and non-GAAP basis are provided in the
table below.
Q2 Q2 Y/Y Six Six Y/Y
FY'12 FY'11 months months
ended ended
FY'12 FY'11
-----------------------------------------------------------------------------
Net revenue ($Millions) 268.0 170.4 57.3% 531.3 246.2 115.8%
Operating margin($Millions) 48.0 9.7 394.8% 96.1 16.7 475.4%
GAAP net income ($Millions) 12.7 4.0 217.5% 36.7 21.9 67.6%
GAAP diluted EPS ($) 0.07 -0.02 450.0% 0.29 0.18 61.1%
Non-GAAP net income ($Millions) 21.5 11.9 80.7% 50.5 27.7 82.3%
Non-GAAP diluted EPS ($) 0.28 0.16 75.0% 0.66 0.37 78.4%
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New customer wins in the quarter
-- A Fortune 1000 Bank in the U.S. has engaged iGATE to support it on a
critical program aimed at the prevention of money laundering. Through
proprietary solutions in data management, iGATE is helping make available
data in theanti-money laundering reporting system. This will help the bank
stay in compliance with requirements of the Bank Secrecy Act and the
Patriot Act.
-- A Europe-based Fortune 1000 company providing engineering and technology
solutions for the energy industry has chosen iGATE to build competencies in
energy related projects in emerging countries. iGATE is helping the company
to reduce execution time by building a competence centre in India and
support its global project deliveries. This centre will concentrate in the
oil and gas domain and deliver high quality design work.
-- A Fortune 500 company that distributes maintenance, repair, and operating
supplies has chosen iGATE to assist the company in reducing the time to
market for its products and services. While iGATE will support this client
in building and deploying a new generation of e-commerce Solutions, this
strategic partnership will allow the client to take advantage of iGATE's
global footprint allowing quicker development and deployment of the
e-Commerce Systems.
-- iGATE has been selected by a Europe-based Fortune 1000 drug manufacturing
company to assist in its compliance related programs. iGATE will provide
validation support to the Product Development Quality and Validation team
of the company (PDQV) and deliver reports that are critical to stay
compliant to regulatory guidelines.
-- iGATE has been selected by a leading U.S. Bank to manage its Liquidity Risk
program. iGATE is using its proprietary Reference Data Management solution
to establish data lineage and identify all of the critical data elements
required for Liquidity Risk management.
-- A leading global manufacturer that supplies oilfield and power transmission
products for use in energy infrastructure and industrial applications has
chosen iGATE to scale its internal IT and achieve global transformation.
iGATE will manage and roll-out Enterprise Applications globally. iGATE was
chosen because of its strong Business Outcomes orientation and the ability
to provide services at a global scale.
Awards and Recognitions
-- iGATE has been ranked No. 18 and also adjudged a 'Leader' in The 2012
Global Outsourcing 100(r) List by The International Association of
Outsourcing Professionals(r) (IAOP(r)). Chosen for the third consecutive year,
iGATE's rank has risen significantly from No. 53 in 2011. The assessment
criterion was based on multiple measurement standards such as- Company
Size; Growth; Global Presence; Customer References; Company Recognitions;
Company Certifications; Employee Management; Executive Leadership.
-- iGATE won the 'World Class Award', the highest honour under the 'Large
Service Organizations' category, at the Global Performance Excellence
Awards (GPEA).
-- iGATE's Legal Team was selected as the winner of the 'International Company
In-House Legal Team of the Year' by the International Financial Law Review
(IFLR)/Asia Law in the Mergers&Acquisitions Category for its
extensive work and valuable contribution in completion of a complex
transaction in the acquisition of Patni Computer Systems Limited.
-- iGATE was ranked No.3 and rated in the 'Leaders' category for its Product
and Engineering Practice by Zinnov Consulting in its Global R&D Service
Providers' Rating.
-- The iGATE Corporation Annual Report 2011 won the Silver Award (Core area-
Tech. and IT Services) in the prestigious LACP Annual Report competition in
the 'Overall Category' for the fourth time in a row.
New Appointment
iGATE appointed Sanjay Tugnait as the new North America Sales Leader and Global
Head of Alliances. Sanjay will be paramount to delivering iGATE's business
growth agenda. He will be part of iGATE's Executive Committee. In a career
spanning over two decades, Sanjay has been part of global companies such as
Accenture and IBM/PWC.
Prior to joining iGATE, Sanjay was the Managing Partner of Accenture's
Financial Services practice in India. He is credited for setting up the
company's Financial Services business in the subcontinent. He has also served
Accenture as a Partner for its North America practice. Sanjay has been part of
Accenture's Global CEO Advisory Council and India Leadership team.
Conference Call and Webcast
iGATE will host a telephone conference call on Friday, July 13, 2012 at 8:00 am
Eastern time to discuss the results of its second quarter and six months ended
June 30, 2012. The live discussion may be accessed by dialing 877-407-8037
(toll free) or 201-689-8037 (toll) and entering account number 293 and
conference number 397094. The on-demand version of the webcast will be
available on the iGATE website shortly after the call.
Investors, potential investors, shareholders and bond holders can access the
telephonic replay by dialing 877-660-6853 (toll free) or 201-612-7415 (toll)
and entering account number 293 and conference number 397094. The telephonic
replay will be available until July 20, 2012.
About Business Outcomes
iGATE's industry-first Business Outcomes-based approach focuses on the
realization of tangible and measurable results, unlike traditional models which
are driven by work, effort, time and manpower. By integrating technology and
processes in a proprietary way and pricing services on results, iGATE exchanges
fixed costs for a variable cost structure in an attempt to get clients to
pay-for-results-only while enabling them adjust to the peaks and valleys of
their demand.
About iGATE
iGATE Corporation is the first integrated technology and operations (iTOPS)
company providing full-spectrum consulting, technology and business process
outsourcing, and product and engineering solutions on a Business Outcomes-based
model. Armed with over three decades of IT Services experience and powered by
the iTOPS platform, iGATE's multi-location global organization has a talent
pool of over 27,000 employees and consistently delivers effective solutions to
over 360 Fortune 1000 clients spanning verticals such as: banking and financial
services; insurance and healthcare; life sciences; manufacturing, retail,
distribution and logistics; media, entertainment, leisure and travel;
communication, energy and utilities; public sector; and independent software
vendors. Please visit www.igate.com for more information.
iGATE Corporation is listed on NASDAQ under the symbol 'IGTE.'
The iGATE Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=5150
Use of non-GAAP Financial Measures
This press release contains non-GAAP financial measures as defined by the
Securities and Exchange Commission. These non-GAAP measures are not in
accordance with, or an alternative for measures prepared in accordance with,
generally accepted accounting principles in the United States and may be
different from non-GAAP measures used by other companies. In addition, these
non-GAAP measures are not based on any comprehensive set of accounting rules or
principles. Reconciliations of these non-GAAP measures to their comparable GAAP
measures are included in the attached financial tables.
iGATE believes that non-GAAP measures have limitations in that they do not
reflect all of the amounts associated with iGATE's results of operations as
determined in accordance with GAAP and that these measures should only be used
to evaluate iGATE's results of operations in conjunction with the corresponding
GAAP measures. These non-GAAP measures should be considered supplemental in
nature and should not be considered in isolation or be construed as being more
important than comparable GAAP measures.
iGATE believes that providing Adjusted EBITDA and non-GAAP net income and
non-GAAP diluted earnings per share in addition to the related GAAP measures
provides investors with greater transparency to the information used by iGATE's
management in its financial and operational decision-making. These non-GAAP
measures are also used by management in connection with iGATE's performance
compensation programs.
More specifically, the non-GAAP financial measures contained herein exclude the
following items:
-- Amortization of intangible assets: Intangible assets comprise value of
customer relationships from the recent Patni acquisition and the previous
delisting of iGATE's Indian subsidiary. iGATE incurs charges relating to
the amortization of these intangibles. These charges are included in
iGATE's GAAP presentation of earnings from operations, operating margin,
net income and diluted earnings per share. iGATE excludes these charges for
purposes of calculating these non-GAAP measures.
-- Stock-based compensation: Although stock-based compensation is an important
aspect of the compensation of iGATE's employees and executives, determining
the fair value of the stock-based instruments involves a high degree of
judgment and estimation and the expense recorded may not reflect the actual
value realized upon the future exercise or termination of the related
stock-based awards. Furthermore, unlike cash compensation, the value of
stock-based compensation is determined using a complex formula that
incorporates factors, such as market volatility, that are beyond our
control. Management believes it is useful to exclude stock-based
compensation in order to better understand the long-term performance of our
core business.
-- Acquisition expenses: iGATE incurs costs related to its acquisitions, which
are inconsistent in amount and frequency and are significantly impacted by
the timing and nature of iGATE's acquisitions. iGATE believes that
eliminating these expenses for purposes of calculating these non-GAAP
measures facilitates a more meaningful evaluation of iGATE's current
operating performance and comparisons to its past operating performance.
-- Foreign Exchange gain: The Company entered into forward foreign exchange
contracts to mitigate the risk of changes in foreign exchange rates on
payments related to the acquisition of Patni. We also recognized favorable
foreign currency gain on re-measurement of escrow account balance
maintained for facilitating payments related to the Patni acquisition.
iGATE believes that eliminating the non-capitalized items for purposes of
calculating these non-GAAP measures facilitates a more meaningful
evaluation of iGATE's current performance and comparisons to its past
performance.
In March 2012, the Company entered into a forward foreign exchange contract to
mitigate the risk of changes in foreign exchange rates on payments related to
the delisting of Patni. In June 2012, the Company recognized foreign currency
loss on re-measurement of escrow account balance and foreign exchange gain on
re-measurement of redeemable non-controlling interest liability. iGATE believes
that eliminating the non-capitalized items for purposes of calculating these
non-GAAP measures facilitates a more meaningful evaluation of iGATE's current
performance and comparisons to its past performance.
-- Severance Cost: As a result of the acquisition of Patni, iGATE incurred
severance costs in connection with the termination of the services of some
of Patni's employees.
-- Delisting expenses: iGATE voluntarily delisted the equity shares of its
majority owned subsidiary, Patni from the National Stock Exchange of India
Limited and the Bombay Stock Exchange Limited and the American Depository
Shares from the New York Stock Exchange. Delisting is an infrequent
activity and expenses incurred in connection therein are inconsistent in
amount and are significantly impacted by the timing and nature of the
delisting. iGATE believes that eliminating these expenses for purposes of
calculating these non-GAAP measures facilitates a more meaningful
evaluation of iGATE's current operating performance and comparisons to its
past operating performance.
From time to time in the future, there may be other items that iGATE may
exclude inpresenting its financial results.
Forward-Looking Statements
Statements contained in this press release regarding the benefits of the Patni
acquisition, the business outlook, the demand for the products and services,
and all other statements in this release other than recitation of historical
facts are forward-looking statements. Words such as 'expect', 'potential',
'believes', 'anticipates', 'plans', 'intends' and similar expressions are
intended to identify such forward-looking statements. Forward-looking
statements in the press release include, without limitation, forecasts of
market growth, future revenues, future expectations concerning growth of
business, cost competitiveness and expansion of global reach following the
acquisition, and other matters that involve known and unknown risks,
uncertainties and other factors that may cause results, levels of activity,
performance or achievements to differ materially from results expressed or
implied by this press release. Such risk factors include, among others:
difficulties encountered in integrating business; whether certain market
segments grow as anticipated; the competitive environment in the information
technology services industry and competitive responses to our acquisition of
Patni; and whether the companies can successfully provide services/products and
the degree to which these gain market acceptance. Furthermore, in connection
with the Patni acquisition, the Company has borrowed significant amounts,
including through the issuance of high yield notes, and will have to use a
significant portion of its cash flows to service such indebtedness, as a result
of which the Company might not have sufficient funds to operate its businesses
in the manner it intends or has operated in the past. Additional risks relating
to the Company are set forth in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2011, as well as the Company's other reports
filed with the Securities and Exchange Commission and risks related to the
business of Patni as set forth in Patni's Annual Report in Form 20-F for the
fiscal year ended December 31, 2011. Actual results may differ materially from
those contained in the forward-looking statements in this press release. Any
forward-looking statements are based on information currently available to the
Company and it assumes no obligation to update these statements as
circumstances change. This document does not constitute an offer to purchase or
to sell securities in any jurisdiction.
iGATE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except per share data)
June 30, December
31,
2012 2011
(unaudited) (audited)
-------------------------
ASSETS
Current assets:
Cash and cash equivalents $ 83,413 $ 75,440
Restricted Cash 26,349 --
Short-term investments 344,987 354,528
Accounts receivable, net 138,788 172,711
Unbilled revenues 100,064 45,223
Prepaid expenses and other current assets 22,839 18,752
Foreign exchange derivative contracts 3,680 277
Prepaid income taxes 11,676 8,341
Deferred tax assets 24,933 20,574
Receivable from Mastech Holdings, Inc. -- 187
-------------------------
Total current assets 756,729 696,033
Deposits and other assets 29,629 32,102
Prepaid income taxes 23,255 18,481
Property and equipment, net 157,359 175,672
Leasehold land 85,890 90,339
Deferred tax assets 27,097 30,456
Goodwill 487,580 511,060
Intangible assets, net 148,121 160,706
-------------------------
Total assets $ 1,715,660 $ 1,714,849
=========================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 7,735 $ 7,857
Accrued payroll and related costs 49,681 71,913
Accrued income taxes 1,108 3,993
Line of credit 57,000 57,000
Other accrued liabilities 80,144 77,988
Foreign exchange derivative contracts 22,254 12,471
Deferred revenue 16,687 22,412
-------------------------
Total current liabilities 234,609 253,634
Other long-term liabilities 3,790 4,610
Senior notes 770,000 770,000
Term Loan 225,500 --
Foreign exchange derivative contracts -- 6,739
Accrued income taxes 24,717 17,672
Deferred tax liabilities 60,464 58,992
-------------------------
Total liabilities 1,319,080 1,111,647
-------------------------
Redeemable non controlling interest 53,175 --
-------------------------
Series B Preferred stock 363,386 349,023
-------------------------
Shareholders' equity:
Common Stock, par value $0.01 per share 582 577
Additional paid-in capital 176,139 201,281
Retained earnings 126,845 104,493
Common stock in treasury, at cost (14,714) (14,714)
Accumulated other comprehensive loss (308,833) (214,641)
-------------------------
Total iGATE Corporation shareholders' equity (19,981) 76,996
(deficit)
Non controlling interest -- 177,183
-------------------------
Total equity (deficit) (19,981) 254,179
-------------------------
Total liabilities, preferred stock and shareholders' $ 1,715,660 $ 1,714,849
equity
=========================
iGATE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands)
(unaudited)
Three Months ended Six Months ended
June 30, June 30,
-------------------------------------------
2012 2011 2012 2011
-------------------------------------------
Revenues $ 267,993 $ 170,417 $ 531,258 $ 246,215
Cost of revenues (exclusive of 167,682 111,203 325,111 155,998
Depreciation and amortization)
-------------------------------------------
Gross margin 100,311 59,214 206,147 90,217
Selling, general and administrative 40,863 40,423 83,284 62,170
Depreciation and amortization 11,445 9,058 26,730 11,365
-------------------------------------------
Income from operations 48,003 9,733 96,133 16,682
Other income (loss), net (30,707) (4,003) (39,430) 15,850
-------------------------------------------
Income before income taxes 17,296 5,730 56,703 32,532
Income tax expense 4,649 1,244 15,512 10,107
-------------------------------------------
Net income before noncontrolling 12,647 4,486 41,191 22,425
interest
Noncontrolling interest -- 487 4,476 487-------------------------------------------
Net income attributable to iGATE 12,647 3,999 36,715 21,938
Corporation
Accretion to Preferred Stock 98 115 192 130
Preferred dividend 7,172 5,639 14,171 8,362
-------------------------------------------
Net income attributable to iGATE $ 5,377 $ (1,755) $ 22,352 $ 13,446
common shareholders
===========================================
iGATE CORPORATION
Earnings Per Share
(Amounts in thousands, except per share data)
(unaudited)
Three Months Ended June Six Months Ended June
30,
30,
--------------------------------------------------------------------------------
---
PARTIC 2012 2011 2012
2011
ULARS
--------------------------------------------------------------------------------
---
Net $ 5,377 $ (1,755) $ 22,352 $
13,446
incom
e
attri
butabl
e to
iGATE
commo
n
share
holder
s
Add: 7,172 5,639 14,171
8,362
Divid
ends
on
Serie
s B
Prefe
rred
Stock
--------- ----------- ----------
---------
12,549 3,884 36,523
21,808
Less:
Divid
ends
paid
on
Com [A] $ -- $ -- $ -- $ --
mon
St
ock
Unv [B] -- -- -- --
est
ed
re
str
ict
ed
st
ock
Ser [C] 7,172 7,172 5,639 5,639 14,171 14,171 8,362
8,362
ies
B
Pr
efe
rre
d
St
ock
--------------------------------------------------------------------
Undist $ 5,377 $ (1,755) $ 22,352 $
13,446
ribute
d
Incom
e
========= =========== ==========
=========
Basic
and
Dilut
ed
alloc
ation
of
Undis
tribut
ed
Incom
e
Com [D] 4,086 (1,351) 16,984
10,352
mon
st
ock
Unv [E] 3 (6) 13
41
est
ed
re
str
ict
ed
st
ock
Ser [F] 1,288 (398) 5,355
3,053
ies
B
Pr
efe
rre
d
St
ock
--------- ----------- ----------
---------
$ 5,377 $ (1,755) $ 22,352 $
13,446
========= =========== ==========
=========
Shares
outst
anding
:
Com 57,227 56,524 57,227
56,524
mon
st
ock
Unv 45 222 45
222
est
ed
re
str
ict
ed
st
ock
Ser 18,045 16,668 18,045
16,668
ies
B
Pr
efe
rre
d
St
ock
--------- ----------- ----------
---------
75,317 73,414 75,317
73,414
========= =========== ==========
=========
Weight
ed
avera
ge
share
s
outst
anding
:Com [G] 57,163 56,514 56,978
56,399
mon
st
ock
Unv [H] 45 238 45
257
est
ed
re
str
ict
ed
st
ock
Par [I] 18,045 16,668 18,045
16,668
tic
ipa
tin
g
pr
efe
rre
d
st
ock
--------- ----------- ----------
---------
75,253 73,420 75,068
73,324
========= =========== ==========
=========
Weight 57,163 56,752 56,978
56,399
ed
avera
ge
commo
n
stock
outst
anding
Diluti 1,569 -- 1,636
1,483
ve
effec
t of
stock
optio
ns and
restr
icted
share
s
outst
anding
--------- ----------- ----------
---------
Diluti [J] 58,732 56,752 58,614
57,882
ve
weigh
ted
avera
ge
share
s
outst
anding
========= =========== ==========
=========
Distri
buted
earni
ngs
per
share
:
Com [K=A/G $ -- $ -- $ --
$ --
mon ]
st
ock
Unv [L=B/H $ -- $ -- $ --
$ --
est ]
ed
re
str
ict
ed
st
ock
Par [M=C/I $ 0.40 $ 0.34 $ 0.79 $
0.50
tic ]
ipa
tin
g
pr
efe
rre
d
st
ock
Undist
ribute
d
earni
ngs
per
share
:
Com [N=D/G $ 0.07 $ (0.02) $ 0.30 $
0.18
mon ]
st
ock
Unv [O=E/H $ 0.07 $ (0.02) $ 0.30 $
0.18
est ]
ed
re
str
ict
ed
st
ock
Par [P=F/I $ 0.07 $ (0.02) $ 0.30 $
0.18
tic ]
ipa
tin
g
pr
efe
rre
d
st
ock
Basic
earni
ngs
per
share
from
opera
tions
Com [K+N] $ 0.07 $ (0.02) $ 0.30 $
0.18
mon
St
ock
Unv [L+O] $ 0.07 $ (0.02) $ 0.30 $
0.18
est
ed
re
str
ict
ed
st
ock
Par [M+P] $ 0.47 $ 0.32 $ 1.09 $
0.68
tic
ipa
tin
g
pr
efe
rre
d
st
ock
Dilute [[A+B+D+E]/J] $ 0.07 $ (0.02) $ 0.29 $
0.18
d
earni
ngs
per
share
from
opera
tions
The number of outstanding participative convertible preferred stock for which
the
earnings per share exceeded the earnings per share of common stock aggregated
to
18.0 million for the three months and six months ended June 30,2012
respectively.These shares were excluded from the computation of diluted
earnings
per share as they were anti-dilutive.
iGATE CORPORATION
Reconciliation of Selected GAAP measures to Non-GAAP measures
(Amounts in thousands, except per share data)
(unaudited)
Three Months ended Six Months ended
June 30th June 30th
---------------------------------------
2012 2011 2012 2011---------------------------------------
GAAP Net income $ 12,647 $ 3,999 $ 36,715 $ 21,938
Adjustments
Amortization of Intangible assets, net 2,121 1,324 4,295 1,520
of taxes
Stock Based Compensation, net of taxes 2,007 2,358 3,972 3,219
Acquisition expenses, net of taxes -- 1,875 -- 10,914
Delisting expenses, net of taxes 847 -- 2,325 --
Forex (gain) / losson acquisition 3,839 (2,008) 3,154 (14,314)
hedging and remeasurement, net of taxes
Severance cost, net of taxes -- 4,388 -- 4,388
---------------------------------------
Non-GAAP Net income $ 21,461 $ 11,936 $ 50,461 $ 27,665
=======================================
Basic earnings per share from operations
GAAP $ 0.07 $ (0.02) $ 0.30 $ 0.18
Non-GAAP $ 0.29 $ 0.16 $ 0.67 $ 0.38
Diluted earnings per share from
operations
GAAP $ 0.07 $ (0.02) $ 0.29 $ 0.18
Non-GAAP $ 0.28 $ 0.16 $ 0.66 $ 0.37
Weighted average shares outstanding, 75,253 73,420 75,068 73,325
Basic*
=======================================
Weighted average dilutive common 76,777 73,420 76,659 74,550
equivalent shares outstanding*
=======================================
*Includes assumed conversion of 18.0 million ,16.7 million shares of Series B
Preferred Stock as of June 30,2012 and 2011 respectively
iGATE CORPORATION
Reconciliation of Net income, net of tax, to Adjusted EBITDA
(Amounts in thousands)
(unaudited)
Three Months ended Six Months ended
June 30th June 30th
----------------------------------------
2012 2011 2012 2011
----------------------------------------
Net income attributable to iGATE $ 12,647 $ 3,999 $ 36,715 $ 21,938
CorporationAdjustments
Depreciation and amortization 11,445 9,058 26,730 11,365
Interest expenses 21,032 13,199 40,155 13,288
Income tax expense 4,649 1,244 15,512 10,107
Noncontrolling interest -- 487 4,476 487
Other income, net (7,596) (3,321) (15,160) (4,418)
Foreign exchange (gain)/loss 17,271 (5,875) 14,435 (24,720)
Stock Based Compensation 2,663 3,014 5,475 4,522
Acquisition expenses -- 1,122 -- 10,914
Severance expenses -- 6,164 -- 6,164
Delisting expenses 1,089 -- 3,204 --
----------------------------------------
Adjusted EBITDA (a non-GAAP measure) $ 63,200 $ 29,091 $ 131,542 $ 49,647
========================================
The Company presents the non-GAAP financial measures EBITDA and adjusted EBITDA
because management uses these measures to monitor and evaluate the performance
of the business and believe the presentation of these measures will enhance the
investors' ability to analyze trends in the business and evaluate the Company
underlying performance relative to other companies in the industry.
The Company presents the non-GAAP financial measures EBITDA and adjusted EBITDA
because management uses these measures to monitor and evaluate the performance
of the business and believe the presentation of these measures will enhance the
investors' ability to analyze trends in the business and evaluate the Company
underlying performance relative to other companies in the industry.
Non-GAAP Disclosure of Adjusted EBITDA
We present Adjusted EBITDA as a supplemental measure of our performance. We
define Adjusted EBITDA as net income attributable to iGATE Corporation plus (i)
depreciation and amortization, (ii) interest expense, (iii) income tax expense,
minus (iv) other income, net plus (v) foreign exchange loss, (v) stock based
compensation (vi) acquisition expenses (vii) severance expenses and (viii)
delisting expenses. We eliminated the impact of the above as we do not
consider them as indicative of our ongoing operating performance. These
adjustments are itemized below. You are encouraged to evaluate these
adjustments and the reasons we consider them appropriate for supplemental
analysis. In evaluating Adjusted EBITDA, you should be aware that in the future
we may incur expenses that are the same as or similar to some of the
adjustments in this presentation. Our presentation of Adjusted EBITDA should
not be construed as an inference that our future results will be unaffected by
unusual or non-recurring items.
We present Adjusted EBITDA because we believe it assists investors and analysts
in comparing our performance across reporting periods on a consistent basis by
excluding items that we do not believe are indicative of our core operating
performance. In addition, we use Adjusted EBITDA: [(i) as a factor in
evaluating management's performance when determining incentive compensation,
(ii) to evaluate the effectiveness of our business strategies and (iii) because
our credit agreement and our indenture use measures similar to Adjusted EBITDA
to measure our compliance with certain covenants.
Adjusted EBITDA has limitations as an analytical tool. Some of these
limitations are:
-- Adjusted EBITDA does not reflect our cash expenditures, or future
requirements, for capital expenditures or contractual commitments;
-- Adjusted EBITDA does not reflect changes in, or cash requirements for, our
working capital needs;
-- Adjusted EBITDA does not reflect the significant interest expense, or the
cash requirements necessary to service interest or principal payments, on
our debts; although depreciation and amortization are non-cash charges, the
assets being depreciated and amortized will often have to be replaced in
the future, and adjusted EBITDA does not reflect any cash requirements for
such replacements; non-cash compensation is and will remain a key element
of our overall long-term incentive compensation package, although we
exclude it as an expense when evaluating our ongoing operating performance
for a particular period; Adjusted EBITDA does not reflect the impact of
certain cash charges resulting from matters we consider not to be
indicative of our ongoing operations; and other companies in our industry
may calculate adjusted EBITDA differently than we do, limiting its
usefulness as a comparative measure.
Because of these limitations, adjusted EBITDA should not be considered in
isolation or as a substitute for performance measures calculated in accordance
with GAAP. We compensate for these limitations by relying primarily on our GAAP
results and using Adjusted EBITDA only supplementally.
CONTACT: Media Contact
Prabhanjan Deshpande 'PD'
+91 80 4104 5006
PD(at)igate.com
Investor Contact
Araceli Roiz
+1 510 896 3007
araceli.roiz(at)igate.com
News Source: NASDAQ OMX
13.07.2012 Dissemination of a Corporate News, transmitted by DGAP -
a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
DGAP's Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de
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Language: English
Company: iGATE Corporation
United States
Phone:
Fax:
E-mail:
Internet:
ISIN: US9901036403
WKN:
End of Announcement DGAP News-Service
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