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Syntel, Inc. (Nasdaq:SYNT), a global provider of digital transformation, information technology and knowledge process services to Global 2000 companies, today announced financial results for the third quarter, ended September 30, 2015.
Third Quarter Financial Highlights
– Q3 revenue of $253.6M, up 11% from year-ago quarter and 6% sequentially
– Q3 EPS of $0.92 per diluted share, up 26% from year-ago quarter, and 28% sequentially
– Q3 cash & short term investments of $980.5M
– Global Headcount of 23,814 on September 30, 2015, down 2% from year-ago quarter, up 4% sequentially
Syntel’s revenue for the third quarter rose to $253.6 million from $228.3 million in the prior-year period and $239.8 million in the second quarter of 2015. During the third quarter, Banking and Financial Services accounted for 49.6 percent of total revenue, with Healthcare and Life Sciences at 16.8 percent, Retail, Logistics and Telecom at 16.3 percent, Insurance at 12.9 percent, and Manufacturing at 4.4 percent.
The Company’s gross margin was 42.4 percent in the third quarter, compared to 41.4 percent in the prior-year period and 38 percent in the second quarter of 2015. Selling, General and Administrative (SG&A) expenses were six percent of revenue in the third quarter, compared to 11.6 percent in the prior-year period and 9.1 percent in the previous quarter.
The third quarter income from operations was 36.5 percent of revenue as compared to 29.8 percent in the prior-year period and 28.9 percent in the second quarter. The sequential rise in operating margin during the third quarter primarily reflects higher revenue, the impact of currency-related balance sheet translations, lower visa and immigration-related expenses, as well as an ongoing focus on operational efficiency.
Net income for the third quarter was $77.7 million or $0.92 per diluted share, compared to $61.6 million or $0.73 per diluted share in the prior-year period and net income of $60.6 million or $0.72 per diluted share in the second quarter of 2015.
During Q3, Syntel spent $3.7 million in CAPEX, largely in support of campus infrastructure, and finished the quarter with cash and short-term investments of $980.5 million. The Company ended the quarter with 23,814 employees globally.
Operational Highlights
“We are very pleased with Syntel’s third quarter performance,” said Syntel CEO and President Nitin Rakesh. “Our Healthcare and Life Sciences segment garnered record revenues, aided by the stepped up investments we’ve made in this strategic industry.”
“Our robust digital and automation capabilities and managed services offerings are resonating with customers and helping us access new channels and broaden our market reach,” said Rakesh. “We have readied our organization to meet the challenges presented by rapid shifts in the technology landscape, and expect to turn these into profitable growth opportunities.”
“Through a relentless focus on innovation and service quality, we strengthened long-term customer relationships this quarter. We also added meaningful new ones that can rely on Syntel as a committed partner to help them navigate change in their businesses.”
