EDISON, N.J., April 28 /PRNewswire-FirstCall/ -- Intelligroup Inc., a consulting, business optimization, and outsourcing firm serving global corporations, today reported results for its first quarter ended March 31, 2008.
First Quarter Highlights -- Revenue growth: Year over year revenue grew 17.7%; quarter over quarter revenue remained relatively flat. -- Gross Margin: Gross margin improved 10 percentage points year over year and decreased slightly by one percentage point quarter over quarter. -- Operating Margin: Operating margin improved by 13.8 percentage points year over year and decreased by 3.8 percentage points quarter over quarter. -- Utilization rates: Utilization remained relatively flat at 69% year on year and quarter on quarter. -- New Customers: 42 new customers were added globally in the first quarter of 2008. First Quarter Performance
The Company reported first quarter 2008 revenues of $38.5 million, which marks a slight increase from $38.3 million in the fourth quarter of 2007 and a 17.7% increase from $32.7 million in the first quarter of 2007. The Company's average onsite bill rates increased by 3% in the first quarter of 2008 as compared with the fourth quarter of 2007 and by 5% as compared with the first quarter of 2007. The Company's average offshore rates were relatively flat in the first quarter of 2008 as compared with the fourth quarter of 2007 and increased by 10% as compared with the first quarter of 2007. The Company's gross margin decreased slightly to 29.7% for the first quarter of 2008 as compared with 30.8% in the fourth quarter of 2007. Due to its focus on effective cost management strategies, the Company's gross margin improved substantially from 19.8% in the first quarter of 2007 to 29.7% for the first quarter of 2008. The Company reported operating income from continuing operations of $1.7 million, which marks a 45% decrease from $3.1 million in the fourth quarter of 2007 and 156% increase from an operating loss of $3.1 million in the first quarter of 2007.
ABOUT INTELLIGROUP
Intelligroup is a vertically-led ERP focused life cycle management partner serving global corporations as well as public sector clients. Its proven Global delivery model has enabled customers to accelerate results and reduce costs significantly. With deep expertise in industry-specific enterprise solutions, Intelligroup has earned a reputation for consistently exceeding client expectations. Intelligroup develops implements and supports IT solutions for some of the largest U.S. school systems and global corporations including GE, Hershey, Abbott Labs, Eastman Chemical, Hitachi, and Kimball International.
SAFE HARBOR STATEMENT
Certain statements contained herein, including statements regarding the development of services and markets and future demand for services and other statements regarding matters that are not historical facts, are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995).
Such forward-looking statements include risks and uncertainties; consequently, actual results may differ materially from those expressed or implied thereby. Factors that could cause actual results to differ materially include, but are not limited to, variability of quarterly operating results, continued uncertainty of the IT market and revenues derived from application management business, uncertainty in revenues for traditional professional services offerings, loss of one or more significant customers, reliance on large projects, concentration of revenue, unanticipated costs associated with continued litigation, ability to attract and retain professional staff, dependence on key personnel, ability to manage growth effectively, risks associated with strategic partnerships, various project-associated risks, including termination with short notice, substantial competition, general economic conditions, risks associated with intellectual property rights, risks associated with international operations and other risk factors detailed under the caption "Risk Factors" in Intelligroup's annual report on Form 10-K for the period ended December 31, 2007. Intelligroup disclaims any intention or obligation to update forward looking statements as a result of developments occurring after the date of this press release.
Intelligroup and the Intelligroup logo are registered trademarks and 'Creating the Intelligent Enterprise', 4Sight, 4Sight Plus, ASPPlus, myADVISOR, ASPPlus Power Upgrade Services and Uptimizer are service marks of Intelligroup in the U.S. and other countries. All other trademarks and company names mentioned are the property of their respective owners.
INTELLIGROUP, INC. CONSOLIDATED BALANCE SHEETS MARCH 31, 2008 AND DECEMBER 31, 2007 (in thousands except par value) Mar 31,2008 Dec 31,2007 Unaudited Audited ASSETS CURRENT ASSETS Cash and cash equivalents $9,459 $8,419 Accounts receivable, less allowance for doubtful accounts of $1,237 and $1,240 at March 31, 2008 and December 31, 2007, respectively 25,541 24,493 Unbilled services, less allowance for doubtful accounts of $911 at March 31, 2008 and December 31, 2007 12,202 11,393 Deferred tax asset, current portion 518 589 Prepaid expenses and taxes 1,135 1,567 Other current assets 1,364 1,965 Total current assets 50,219 48,426 Property and equipment, net 6,181 6,470 Goodwill and Intangibles 2,812 3,034 Restricted Cash 4,875 4,848 Deferred taxes and other assets 2,694 2,684 Total assets $66,781 $65,462 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Line of credit borrowings $6,852 $6,566 Accounts payable 3,406 3,542 Accrued payroll and related taxes 11,882 11,645 Accrued expenses and other current liabilities 4,290 4,878 Current portion of deferred revenue 3,300 3,345 Current portion of obligations under capital leases 454 457 Total current liabilities 30,184 30,433 Obligations under capital leases, net of current portion 225 375 Deferred revenue, net of current portion 743 691 Other long-term liabilities 545 579 Total liabilities 31,697 32,078 Commitments and contingencies Shareholders' Equity Preferred stock, $.01 par value, 5,000 shares authorized, none issued or outstanding - - Common stock, $.01 par value, 50,000 shares authorized and 42,160 shares issued and outstanding at March 31 2008 and December 31, 2007 421 421 Additional paid-in capital 71,413 71,119 Accumulated deficit (38,926) (40,789) Accumulated other comprehensive income 2,176 2,633 Total shareholders' equity 35,084 33,384 Total liabilities and shareholders' equity $66,781 $65,462 INTELLIGROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (in thousands except per share data) THREE MONTHS ENDED MARCH 31, Unaudited Unaudited 2008 2007 Revenue $38,453 $32,700 Cost of revenue 27,029 26,240 Gross profit 11,424 6,460 Selling, general and administrative expenses 8,998 8,912 Depreciation and amortization 720 598 Total operating expenses 9,718 9,510 Operating Income/(Loss) 1,706 (3,050) Interest income 106 17 Interest expense (161) (209) Other income, net 537 62 Income / (Loss) before income taxes 2,188 (3,180) Provision for income taxes 326 233 Net Income / (Loss) $1,862 $(3,413) Basic net income/(loss) per share $0.04 $(0.08) Diluted net income/(loss) per share $0.04 $(0.08) Weighted average number of common shares outstanding - Basic 42,160 41,933 - Diluted 42,493 41,933 Comprehensive income (loss) Net Income/(loss) $1,862 $(3,413) Other comprehensive income (loss) Currency translation adjustments (457) 387 Comprehensive Income/(loss) $1,405 $(3,026)
