Westborough, MA — (May 13, 2009) — Virtusa Corporation (NASDAQ: VRTU), a global information technology (IT) services company that provides IT consulting, technology implementation and application outsourcing services through an enhanced global delivery model, today reported financial results for the fourth quarter and fiscal year 2009, ended March 31, 2009.
Fourth Quarter Fiscal 2009 Financial Results
Revenue for the fourth quarter of fiscal 2009 was $41.4 million, a decrease of 8% year-over-year and sequentially. On a constant currency basis (1), fourth quarter revenue was flat year-over-year and decreased 4% sequentially.
Virtusa reported income from operations of $3.9 million for the fourth quarter of fiscal 2009, compared to $5.6 million for the fourth quarter of fiscal 2008 and $5.4 million in the third quarter of fiscal 2009.
Net income for the fourth quarter of fiscal 2009 was $3.6 million, or $0.15 per diluted share, compared to $5.3 million, or $0.21 per diluted share for the fourth quarter of fiscal 2008 and $6.3 million, or $0.27 per diluted share, for the third quarter of fiscal 2009.
The Company ended the fourth quarter of fiscal 2009 with $107.1 million of cash and cash equivalents, short-term investments and long-term investments. The Company generated cash from operations of $10.9 million during the fourth quarter of fiscal 2009. Pursuant to the Company’s share repurchase program, the Company repurchased 259,800 shares for $1.5 million at an average price of $5.77 during the fourth quarter of fiscal 2009.
Full Year Fiscal 2009 Financial Results
For the fiscal year ended March 31, 2009, revenue increased 5%, to $172.9 million, compared to the fiscal year ended March 31, 2008. On a constant currency basis (1), fiscal year 2009 revenue increased 10% year-over-year.
Virtusa reported income from operations of $10.0 million for the fiscal year 2009, compared to $19.4 million for the fiscal year 2008.
Net income for fiscal year 2009 was $12.1 million, or $0.50 per diluted share, compared to $17.8 million, or $0.76 per diluted share, for fiscal year 2008.
Kris Canekeratne, Virtusa’s Chairman and CEO, stated “In the face of a challenging economic environment, we made good progress on our fiscal 2009 goals. We strengthened our client relationships, added a significant number of new clients, and maintained our high levels of client delight.” Mr. Canekeratne continued, “Our value proposition continues to resonate well with clients due to our ability to drive down their costs and improve business outcomes.”
Ranjan Kalia, Chief Financial Officer, said “Our quarterly fiscal year 2009 results demonstrate our focus on improving operational effectiveness as evidenced by increased utilization, enhanced offshore effort mix and ongoing cost efficiencies. We continued to maintain a strong balance sheet and increased our cash position to $107.1 million.” Mr. Kalia continued, “As we look forward to fiscal 2010, we expect our clients’ budgets to remain under pressure near term, but we will stay focused on operational efficiencies and maintaining profit margins for the full fiscal year.”
Financial Outlook
Virtusa management provided the following current financial guidance:
The Company’s first quarter and fiscal year 2010 diluted EPS estimates assume an average share count of approximately 23.6 million and 23.5 million, respectively (assuming no further exercises of stock-based awards and no impact from the share repurchase program) and assumes a stock price of $7.02, which was derived from the average closing price of the Company’s stock over the five trading days ended on May 8, 2009. Deviations from this stock price may cause actual EPS to vary based on share dilution from Virtusa’s stock options and stock appreciation rights.
Conference Call and Webcast
Virtusa will host a conference call today, May 13, 2009 at 5:00 pm Eastern time to discuss the Company’s fourth quarter and full year 2009 financial results, current financial guidance and other corporate developments. To access this call, dial 888-801-6498 (domestic) or 913-312-0820 (international). A replay of this conference call will be available through May 20, 2009 at 888-203-1112 (domestic) or 719-457-0820 (international). The replay passcode is 4694200. A live webcast of this conference call will be available on the “Investors” page of the Company’s website (www.Virtusa.com), and a replay will be archived on the website as well.