iGATE Corporation (iGATE or the Company) (Nasdaq:IGTE), the first
integrated Technology and Operations (iTOPS) company providing
Business Outcomes based solutions under the brand iGATE Patni,
today announced its financial results for the fourth quarter and
year ended December 31, 2011.
Fourth Quarter Highlights
- Revenues for fourth quarter 2011 were $267.7
million.
- Compared with $81.0 million in the fourth quarter 2010
- Compared with $265.7 million in the third quarter 2011
- Net Income for fourth quarter 2011 was $15.3
million.
- Compared with $14.7 million in the fourth quarter 2010
- Compared with $14.3 million in the third quarter 2011
- Interest expense impacted net income by $17.8 million in the
fourth quarter 2011
- Gross margin was 40.3 % for the fourth quarter
2011.
- Compared with 42.7% in the fourth quarter 2010
- Compared with 36.9 % in the third quarter 2011
- Diluted earnings per share for the fourth quarter 2011
were $0.11 GAAP; $0.27 non-GAAP.
- Compared with $0.25 GAAP in fourth quarter 2010; $0.34 non-GAAP
in fourth quarter 2010
- Compared with $0.10 GAAP in third quarter 2011; $0.26 non-GAAP
in third quarter 2011
- Adjusted EBITDA was $68.1 million for the fourth
quarter 2011.
- Compared with $23.4 million in the fourth quarter 2010
- Compared with $55.8 million in the third quarter 2011
- 16 new customers were added during the fourth quarter,
including three Fortune 1000 companies.
- Headcount was at 26,523 employees as of December 31,
2011.
Full Year Highlights
- Revenues for the year ended December 31, 2011 were
$779.6 million.
- Compared with $280.6 million for the year ended December 31,
2010.
- Net Income for the year ended December 31, 2011 was
$51.5 million.
- Compared with $51.8 million for the year ended December 31,
2010.
- Interest expense impacted net income by $50.6 million.
- Gross margin was 38.0% for the year ended December 31,
2011.
- Compared with 40.2 % for the year ended December 31, 2010.
- Diluted earnings per share were $0.38 GAAP; $0.90
non-GAAP.
- Compared with $0.89 GAAP; $1.08 non-GAAP in the corresponding
period in 2010.
- Adjusted EBITDA was $173.5 million for the year ended
December 31, 2011.
- Compared with $72.4 million for the year ended December 31,
2010.
Expansion
- iGATE Patni has invested $15 million into a new 260,000 sq. ft
facility in Bangalore. With a capacity of seating more than 2,500
people, this building is the largest single phase delivery center
equipped with state of the art energy and green sustenance
features.
- A large Capital outlay of $120 million has been approved to
build a residential training facility in Pune along with a 5000
member capacity delivery center, campus expansion in Mumbai, and
another extra phase in Bangalore.
On the performance of the Company in 2011, Phaneesh
Murthy, Chief Executive Officer, iGATE Patni, said,
"Fiscal year 2011 was a milestone year for iGATE Patni, with the
combined entity ending the year with revenue run rate in excess of
$1 billion. I am particularly happy with the way our integration
with Patni has been going smoothly and at an accelerated pace
ensuring value protection to all stakeholders."
On the outlook for 2012, Phaneesh Murthy said,
"We are seeing that our differentiated outcomes-based business
model is getting increased traction. I am also happy to report that
it looks like almost all our top customers will be expanding work
and programs with us."
Sujit Sircar, Chief Financial Officer, iGATE Patni,
said, "With the integration in place and benefits of a
single combined entity beginning to take shape, we have made
significant savings in terms of costs during the year, to the
extent of approximately $32 million. The depreciation of the rupee
also had a positive impact of approximately a 3% on the Company's
profitability in the fourth quarter. The rupee volatility is a
concern in the longer run; however, in 2012 we will continue to
sustain the benefits of our successful integration."
Fourth Quarter and Fiscal Year 2011 Operating
Results
Results for the fourth quarter and full fiscal year of both 2011
and 2010, on both GAAP and non-GAAP basis, are provided in the
table below.
|
Q4 FY11 |
Q4 FY10 |
Y/Y |
FY11 |
FY10 |
Y/Y |
Net revenue
($Millions) |
267.7 |
81.0 |
230% |
779.6 |
280.6 |
178% |
Operating margin
($Millions) |
51.5 |
15.4 |
234% |
105.9 |
53.0 |
100% |
GAAP net income
($Millions) |
15.3 |
14.7 |
4% |
51.5 |
51.8 |
(1%) |
GAAP diluted EPS
($) |
0.11 |
0.25 |
(56%) |
0.38 |
0.90 |
(57%) |
Non-GAAP net income
($Millions) |
20.1 |
19.9 |
(1%) |
67.0 |
62.2 |
8% |
Non-GAAP diluted EPS
($) |
0.27 |
0.34 |
(21%) |
0.89 |
1.08 |
(18%) |
Key New Customers and Projects during the Fourth
Quarter
- A North America-based Fortune 1000 communications company chose
iGATE Patni improving and providing a unified customer experience
across its business units while at the same time standardizing and
optimizing workforce management practices to achieve best in
industry cost and efficiency. iGATE Patni will leverage its
experience in executive dashboards and data analytics to provide an
enterprise-wide view of its customer service performance.
- A North America based financial services firm selected iGATE
Patni to redesign its dealer portal thus impacting customer
satisfaction and increase the ability to cross sell products. The
firm's current portal has an Advisor Center that helps creation of
new accounts, allows Financial Advisors to manage their Client's
Portfolios and generate different Reports. iGATE Patni will develop
a new intuitive and self service portal that will provide better
user experience to Financial Advisors, Broker dealers and
Investment advisors along with faster turnover on key
functions.
- An Indian state-owned Fortune 1000 company that is in the oil
and gas sector chose iGATE Patni for its software development needs
as the first "Unique Identification Authority of India (UIDAI)"
opportunity in India.
- A leading American Wealth Management firm chose iGATE Patni for
a Process Consulting engagement. As part of the engagement, iGATE
Patni, through a combination of Six Sigma and other proprietary
methodologies, will identify opportunities to reduce the operating
expenses of the client.
- One of the largest and most diversified groups in the Middle
East region operating in various sectors that includes Automobiles,
Industrial Trading, Media, Retail, engaged iGATE Patni in an
enterprise cost optimization initiative and provide Business
Intelligence solutions across the Gulf Conglomerate's breadth of
businesses. As part of the deal, iGATE Patni will replace different
bespoke systems that were developed originally to meet the needs of
individual organizations and implement an Oracle ERP on a single
platform.
- A North America-based Fortune 1000 company that conducts
business in the areas of diversified industrial manufacturing has
signed a product engineering deal with iGATE Patni pursuant to
which the Company will be responsible for developing a new
generation of residential locks for the client that will enable
newer ways of ensuring security and safety to households.
- A major operator of marine ports in the Middle East has chosen
iGATE Patni for its port function decentralization effort. The
project involves providing documentation on current architecture of
the system as well the proposed system design, to be followed for
the de-centralization.
Awards and Recognitions
- iGATE Corporation Wins "Golden Peacock" Global Award (Americas)
for Excellence in Corporate Governance
- iGATE Patni's IT and Business Enabling functions in Bangalore
were successfully appraised and rated at People CMM® maturity level
5.
- Phaneesh Murthy received Enterprise Asia's "Outstanding
Entrepreneurship" Award for 2011.
- iGATE Patni's Employee Engagement initiative, "Thank God It's
Monday," entered the Limca Book of Records for running a corporate
music show every Monday for five consecutive years.
Conference Call and Webcast
The Company has scheduled its Earnings Conference Call on
Wednesday, January 25, 2012 to discuss the results of its fourth
quarter ended December 31, 2011. Senior management of the Company
will discuss the Company's financial performance for the quarter
and answer participants' questions during the call.
Time: |
08:00-9:00 a.m. Eastern Standard Time /
05:00-06:00 a.m. Pacific Standard Time |
Dial-in: |
877-407-8037 (U.S.) |
|
201-689-8037 (International) |
The call will be webcast live on iGATE Patni's website
(www.igatepatni.com) and can be accessed by going to the Investor
Relations page and selecting "Events." Participants are requested
to log in 10 minutes prior to the start of the webcast. The
on-demand version of the webcast will be available on the Company's
website shortly after the call.
Investors, potential investors, shareholders and bond holders
can access the telephonic replay by dialing 877-660-6853 (U.S.) or
201-612-7415 (international) and entering account number 293 and
conference number 386227. The telephonic replay will be available
until February 01, 2012.
About iGATE Patni
'iGATE Patni' is the common brand identity of two organizations
— iGATE and Patni. With iGATE Corporation having acquired a
majority stake in Patni Computer Systems Limited, the two
companies, under the common brand iGATE Patni, provide
full-spectrum consulting, technology and business process
outsourcing, and product engineering services on a Business
Outcomes-based model. Armed with over three decades of IT Services
experience and powered by the iTOPS (Integrated Technology and
Operations) platform, iGATE Patni's multi-location global
organization with a talent pool of over 26,000 people, consistently
delivers effective solutions to over 360 Fortune 1000 clients
spanning across verticals like: 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. Visit www.igatepatni.com.
iGATE Corporation is listed on NASDAQ (IGTE), and Patni Computer
Systems Limited is listed on the Bombay Stock Exchange (532517),
the National Stock Exchange of India (PATNI) and the New York Stock
Exchange (PTI).
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.
- Forex 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 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.
- 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 is voluntarily delisting 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 in presenting 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, 2010, 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, 2010. 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) |
|
|
|
|
December 31, |
December 31, |
|
2011 |
2010 |
|
(unaudited) |
(audited) |
ASSETS |
|
|
Current assets: |
|
|
Cash and cash
equivalents |
$ 75,440 |
$ 67,924 |
Short-term
investments |
354,528 |
71,915 |
Accounts receivable,
net |
172,711 |
37,946 |
Unbilled revenues |
45,223 |
13,893 |
Prepaid expenses and
other current assets |
18,752 |
5,380 |
Foreign exchange
derivative contracts |
-- |
794 |
Deferred tax assets |
20,574 |
5,422 |
Prepaid income taxes |
8,341 |
-- |
Receivable from Mastech
Holdings Inc. |
187 |
140 |
Total current assets |
695,756 |
203,414 |
|
|
|
Investment in affiliate |
584 |
-- |
Deposits and other assets |
67,940 |
5,443 |
Property and equipment, net |
175,672 |
52,950 |
Lease hold Land |
53,917 |
-- |
Prepaid income taxes |
18,481 |
-- |
Deferred tax assets |
30,456 |
10,117 |
Goodwill |
511,060 |
31,741 |
Intangible assets, net |
160,706 |
1,378 |
Total assets |
$ 1,714,572 |
$ 305,043 |
|
|
LIABILITIES, PREFERRED
STOCK AND SHAREHOLDERS' EQUITY |
|
Current liabilities: |
|
|
Accounts payable |
$ 7,857 |
$ 3,291 |
Accrued payroll and
related costs |
71,913 |
19,709 |
Accrued income taxes |
3,993 |
715 |
Line of credit |
57,000 |
-- |
Other accrued
liabilities |
89,294 |
31,354 |
Foreign exchange
derivative contracts |
1,669 |
-- |
Deferred revenue |
21,631 |
667 |
Total current
liabilities |
253,357 |
55,736 |
|
|
|
Other long-term
liabilities |
4,610 |
1,251 |
Accrued income taxes |
17,672 |
-- |
Foreign exchange
derivative contracts |
6,739 |
-- |
Deferred tax liabilities |
58,992 |
-- |
Senior Notes |
770,000 |
-- |
Total liabilities |
1,111,370 |
56,987 |
|
|
|
Series B Preferred stock, without par
value |
349,023 |
-- |
|
|
|
Shareholders' equity: |
|
|
|
|
|
Common Stock, par value
$0.01 per share |
577 |
572 |
Additional paid-in
capital |
201,281 |
188,389 |
Retained earnings |
104,493 |
75,474 |
Common stock in treasury,
at cost |
(14,714) |
(14,714) |
Accumulated other
comprehensive loss |
(257,920) |
(1,665) |
Total iGATE Corporation shareholders'
equity |
33,717 |
248,056 |
Non controlling interest |
220,462 |
-- |
Total shareholders'
equity |
254,179 |
248,056 |
Total liabilities and
shareholders' equity |
$ 1,714,572 |
$ 305,043 |
|
iGATE
CORPORATION |
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME |
(Amounts in thousands) |
|
|
|
|
|
|
Three Months
ended |
Year
ended, |
|
December
31, |
December
31, |
|
2011 |
2010 |
2011* |
2010 |
|
(unaudited) |
(unaudited) |
(unaudited) |
(audited) |
|
|
|
|
|
Revenues |
$ 267,707 |
$ 81,013 |
$ 779,646 |
$ 280,597 |
|
|
|
|
|
Cost of revenues (exclusive of depreciation
and amortization) |
159,941 |
46,460 |
483,504 |
167,906 |
|
|
|
|
|
Gross margin |
107,766 |
34,553 |
296,142 |
112,691 |
|
|
|
|
|
Selling, general and administrative
expense |
42,582 |
16,765 |
151,497 |
50,669 |
|
|
|
|
|
Depreciation and amortization |
13,703 |
2,415 |
38,735 |
9,014 |
|
|
|
|
|
Income from
operations |
51,481 |
15,373 |
105,910 |
53,008 |
|
|
|
|
|
Other (expenses) income, net |
(14,151) |
1,917 |
(21,638) |
4,686 |
|
|
|
|
|
Income before income taxes |
37,330 |
17,290 |
84,272 |
57,694 |
|
|
|
|
|
Income tax expense |
16,904 |
2,568 |
24,218 |
5,939 |
|
|
|
|
|
Net income before noncontrolling
interest |
20,426 |
14,722 |
60,054 |
51,755 |
|
|
|
|
|
Noncontrolling interest |
5,149 |
-- |
8,586 |
-- |
|
|
|
|
|
Net income attributable to iGATE
Corporation |
15,277 |
14,722 |
51,468 |
51,755 |
|
|
|
|
|
Accretion to Preferred Stock |
88 |
-- |
302 |
-- |
Preferred dividend |
7,016 |
-- |
22,147 |
-- |
Net income attributable to iGATE Corporation
common shareholders |
$ 8,173 |
$ 14,722 |
$ 29,019 |
$ 51,755 |
|
|
|
|
|
*Includes Patni revenues since May 16,
2011. |
|
|
|
|
|
iGATE
CORPORATION |
Earnings Per Share |
(Amounts in thousands, except
per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31 |
|
Year ended
December 31 |
PARTICULARS |
|
|
2011 |
|
2010 |
|
2011** |
|
2010 |
|
|
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(audited) |
|
|
|
|
|
|
|
|
|
|
Net income attributable to iGATE common
shareholders |
|
|
$ 8,173 |
|
$ 14,722 |
|
$ 29,019 |
|
$ 51,755 |
Add: Dividends on Series B Preferred
Stock |
|
|
7,016 |
|
-- |
|
22,147 |
|
-- |
|
|
|
15,189 |
|
14,722 |
|
51,166 |
|
51,755 |
|
|
|
|
|
|
|
|
|
|
Less: Dividends paid on |
|
|
|
|
|
|
|
|
|
Common Stock |
[A] |
$ -- |
|
$ 8,433 |
|
$ -- |
|
$ 14,509 |
|
Unvested restricted stock |
[B] |
-- |
|
43 |
|
-- |
|
103 |
|
Participating preferred
stock |
[C] |
7,016 |
7,016 |
-- |
8,476 |
22,147 |
22,147 |
-- |
14,612 |
Undistributed
Income |
|
|
$ 8,173 |
|
$ 6,246 |
|
$ 29,019 |
|
$ 37,143 |
|
|
|
|
|
|
|
|
|
|
Allocation of Undistributed
Income |
|
|
|
|
|
|
|
|
|
Common stock |
[D] |
|
6,240 |
|
6,215 |
|
22,157 |
|
36,878 |
Unvested restricted
stock |
[E] |
|
24 |
|
31 |
|
84 |
|
265 |
Participating preferred
stock |
[F] |
|
1,909 |
|
-- |
|
6,778 |
|
-- |
|
|
|
$ 8,173 |
|
$ 6,246 |
|
$ 29,019 |
|
$ 37,143 |
|
|
|
|
|
|
|
|
|
|
Shares outstanding for allocation of
undistributed income: |
|
|
|
|
|
|
|
|
|
Common stock |
|
|
56,706 |
|
56,227 |
|
56,706 |
|
56,227 |
Unvested restricted
stock |
|
|
214 |
|
280 |
|
214 |
|
280 |
Participating preferred
stock |
|
|
17,347 |
|
-- |
|
17,347 |
|
-- |
|
|
|
74,267 |
|
56,507 |
|
74,267 |
|
56,507 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
|
|
Common stock |
[G] |
|
56,671 |
|
56,141 |
|
56,523 |
|
55,656 |
Unvested restricted
stock |
[H] |
|
213 |
|
294 |
|
217 |
|
399 |
Participating preferred
stock |
[I] |
|
17,347 |
|
-- |
|
17,347 |
|
-- |
|
|
|
74,231 |
|
56,435 |
|
74,087 |
|
56,055 |
|
|
|
|
|
|
|
|
|
|
Weighted average common stock
outstanding |
|
|
56,671 |
|
56,141 |
|
56,523 |
|
55,656 |
Dilutive effect of stock options and
restricted shares outstanding |
|
|
1,390 |
|
1,716 |
|
1,420 |
|
1,738 |
Dilutive weighted average shares
outstanding |
[J] |
|
58,061 |
|
57,857 |
|
57,943 |
|
57,394 |
|
|
|
|
|
|
|
|
|
|
Distributed earnings per
share: |
|
|
|
|
|
|
|
|
|
Common stock |
[K=A/G] |
|
$ -- |
|
$ 0.15 |
|
$ -- |
|
$ 0.26 |
Unvested restricted stock |
[L=B/H] |
|
$ -- |
|
$ 0.15 |
|
$ -- |
|
$ 0.26 |
Participating preferred
stock |
[M=C/I] |
|
$ 0.40 |
|
$ -- |
|
$ 1.28 |
|
$ -- |
|
|
|
|
|
|
|
|
|
|
Undistributed earnings per share: |
|
|
|
|
|
|
|
|
|
Common stock |
[N=D/G] |
|
$ 0.11 |
|
$ 0.11 |
|
$ 0.39 |
|
$ 0.66 |
Unvested restricted stock |
[O=E/H] |
|
$ 0.11 |
|
$ 0.11 |
|
$ 0.39 |
|
$ 0.66 |
Participating preferred
stock |
[P=F/I] |
|
$ 0.11 |
|
$ -- |
|
$ 0.39 |
|
$ -- |
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from
operations |
|
|
|
|
|
|
|
|
|
Common Stock |
[K+N] |
|
$ 0.11 |
|
$ 0.26 |
|
$ 0.39 |
|
$ 0.92 |
Unvested restricted stock |
[L+O] |
|
$ 0.11 |
|
$ 0.26 |
|
$ 0.39 |
|
$ 0.92 |
Participating preferred
stock |
[M+P] |
|
$ 0.51 |
|
$ -- |
|
$ 1.67 |
|
$ -- |
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share from
operations |
[[A+B+D+E]/J] |
|
$ 0.11 |
|
$ 0.25 |
|
$ 0.38 |
|
$ 0.90 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
**Includes Patni balances since
May 16, 2011 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The number of outstanding
participative convertible preferred stock for which the earnings
per share exceeded the earnings per share of common stock
aggregated to 17.3 million shares for the three and twelve months
ended Dec 31, 2011. These shares were excluded from the computation
of diluted earnings per share as they were anti-dilutive. |
|
iGATE
CORPORATION |
Reconciliation of Net income,
net of tax, to Adjusted EBITDA |
(Amounts in thousands) |
(Unaudited) |
|
Three Months
ended |
Year
ended |
|
December
31 |
December
31 |
|
2011 |
2010 |
2011* |
2010 |
|
|
|
|
|
Net income attributable to iGATE
Corporation |
$ 15,277 |
$ 14,722 |
$ 51,468 |
$ 51,755 |
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
13,703 |
2,415 |
38,735 |
9,014 |
Interest expenses |
17,774 |
28 |
50,608 |
108 |
Income tax expense |
16,904 |
2,568 |
24,218 |
5,939 |
Noncontrolling interest |
5,149 |
-- |
8,586 |
-- |
Other income, net |
(7,393) |
(1,169) |
(15,894) |
(5,171) |
Foreign exchange (gain)/loss |
3,770 |
(776) |
(13,076) |
377 |
Stock Based Compensation |
1,869 |
1,829 |
10,737 |
6,651 |
Acquisition expenses |
-- |
3,749 |
10,914 |
3,749 |
Delisting expenses |
997 |
-- |
997 |
-- |
Severance expenses |
-- |
-- |
6,164 |
-- |
Adjusted EBITDA (a non-GAAP measure) |
$ 68,050 |
$ 23,366 |
$ 173,457 |
$ 72,422 |
|
|
|
|
|
|
|
|
|
|
*Includes Patni Balances since May 16,
2011 |
|
|
|
|
The company presents the non-GAAP
financial measure adjusted EBITDA because, management uses this
measure to monitor |
and evaluate the performance of
the business and believes the presentation of this measure will
enhance the investors' ability |
to analyze trends in the business
and evaluate the Company's 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.
|
iGATE
CORPORATION |
Reconciliation of Selected GAAP
measures to Non-GAAP measures |
(Amounts in thousands, except
per share data) |
(Unaudited) |
|
Three Months
ended |
Year
ended, |
|
December
31 |
December
31 |
|
2011 |
2010 |
2011** |
2010 |
|
|
|
|
|
Net income attributable to iGATE
Corporation |
$ 15,277 |
$ 14,722 |
$ 51,468 |
$ 51,755 |
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
Amortization of Intangible assets, net of
taxes |
2,551 |
197 |
6,191 |
774 |
Share Based Compensation, net of taxes |
1,804 |
1,720 |
8,530 |
6,437 |
Acquisition expenses |
-- |
3,213 |
10,914 |
3,213 |
Delisting expenses |
997 |
-- |
997 |
-- |
Forex gain on acquisition hedging and other
remeasurement, net of taxes |
(724) |
-- |
(15,975) |
-- |
Severance cost, net of taxes |
222 |
-- |
4,897 |
-- |
|
|
|
|
|
Non-GAAP Net income |
$ 20,127 |
$ 19,852 |
$ 67,022 |
$ 62,179 |
|
|
|
|
|
Basic earnings per share from
operations |
|
|
|
|
GAAP |
$ 0.11 |
$ 0.26 |
$ 0.39 |
$ 0.92 |
Non-GAAP |
$ 0.27 |
$ 0.35 |
$ 0.90 |
$ 1.11 |
|
|
|
|
|
Diluted earnings per share from
operations |
|
|
|
|
GAAP |
$ 0.11 |
$ 0.25 |
$ 0.38 |
$ 0.90 |
Non-GAAP |
$ 0.27 |
$ 0.34 |
$ 0.89 |
$ 1.08 |
|
|
|
|
|
Weighted average shares outstanding,
Basic |
74,231* |
56,439 |
74,087* |
56,055 |
Weighted average dilutive common
equivalent shares outstanding |
75,408* |
57,857 |
75,290* |
57,394 |
|
|
|
|
|
*Includes assumed conversion of
17.3 million shares of Series B Preferred Stock as of January 1,
2011. |
|
**Includes Patni balances since May 16,
2011 |
|
|
|
|
CONTACT: Media Contact
Prabhanjan Deshpande "PD"
+91 80 4104 5006
PD@igatepatni.com
Investor Contact
Araceli Roiz
+1 510 896 3007
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