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    Persistent Q1 revenue falls, but company sees growth in top clients

    Synopsis

    In rupee terms, revenue rose 0.6 per cent to Rs 500.4 crore and profit after tax dropped to 11.6 per cent sequentially to Rs 67.2 crore.

    ET Bureau
    MUMBAI: Persistent Systems, a Pune-based IT services company, said first-quarter revenue fell 1.8 per cent sequentially as some clients pulled out of projects due to a change in their strategy but said that typically such revenue can be recovered when a new strategy is firmed up.

    The company’s revenue dropped to $78.6 million. In rupee terms, revenue rose 0.6 per cent to Rs 500.4 crore and profit after tax dropped to 11.6 per cent sequentially to Rs 67.2 crore.

    Persistent had warned of the weak quarterly results last month, saying that it was facing turbulence in client demand.

    The Pune-based company typically received most of its revenue from software product companies, who are realigning their business, and is now seeing more demand for large enterprises that are realizing the need for a software-focused strategy.

    The company said it added 49 new accounts in the quarter, about half of which came from the enterprise side.

    Despite the drop in revenue, there were some bright spots in Persistent’s results. Revenue from its topped client bounced back to 18.1 per cent of revenue, from two straight quarters of declines. Revenue from its top ten customers grew to 45.6 per cent of revenue.

    “There has been turbulence but there have been bright spots. The number of $3 million clients and $1 million clients have grown,” Anand Deshpande, chairman and managing director of Persistent, said in an interview with ET. Persistent had 15 clients that contributed over $3 million to revenue, and 52 clients that contribute over $1 million.

    The company also said its venture fund had invested in Jocata Corp, a big data firm that provides solutions around Know Your Customer andAnti-Money Laundering. It also announced an investment in OpsDataStore Inc, which helps organization manage all their IT operations data in one store.

    The company also announced acquisitions of RGen, Aepona Holdings, an Intel company, and Convirture.

    “We continue to strengthen our product portfolio under our Accelerite brand. We continue to play a strategic role for our product engineering customers and we expect to see good traction with customers as they develop their next generation products,” Deshpande said in a statement.



    ( Originally published on Jul 25, 2015 )

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    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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