Westborough, MA, February 6, 2015: Virtusa Corporation, a global business consulting and IT outsourcing company that combines innovation, technology leadership and industry solutions to transform the customer experience, today reported consolidated financial results for the third quarter fiscal year 2015, ended December 31, 2014.
Third Quarter Fiscal 2015 Consolidated Financial Results
Revenue for the third quarter of fiscal 2015 was $123.0 million, an increase of 4.5% sequentially and 22% year-over-year in reported currency. On a constant currency basis, third quarter revenue increased 6% sequentially and 22% year-over-year.
Income from operations increased to $14.6 million for the third quarter of fiscal 2015, compared to $12.2 million for the second quarter of fiscal 2015, and $11.2 million for the third quarter of fiscal 2014.
Net income for the third quarter of fiscal 2015 increased to $11.8 million, or $0.40 per diluted share, compared to $10.1 million, or $0.34 per diluted share, for the second quarter of fiscal 2015, and compared to $9.3 million, or $0.35 per diluted share, for the third quarter of fiscal 2014.
The Company ended the third quarter of fiscal 2015 with $224.5 million of cash, cash equivalents, and short-term and long-term investments. Cash flow from operations for the third quarter of fiscal 2015 was $12.6 million.
Kris Canekeratne, Virtusa’s Chairman and CEO, stated, “Our results this quarter further validate that our initiatives to meet our clients’ dual mandate of simultaneously improving operational efficiencies through business transformation, and generating incremental revenue growth through digital initiatives are working. We continue to strengthen our client relationships, increasing the value we deliver through our industry expertise and delivery excellence.”
Ranjan Kalia, Chief Financial Officer, said, “Our business continues to benefit from a greater number of transformational programs. Investments in increased onsite effort will impact margins as these transformational programs ramp, but are expected to deliver returns as revenue scales and we leverage our global delivery model.” Kalia continued, “Our fourth quarter revenue guidance reflects continued strong growth, even when absorbing an expected impact of approximately $1.8 million from European currency movements.”
Virtusa management provided the following current financial guidance:
- Fourth quarter fiscal year 2015 revenue is expected to be in the range of $125.0 to $127.0 million, with diluted EPS of $0.39 to $0.41.
- Fiscal year 2015 revenue is expected to be in the range of $478.0 to $480.0 million, with diluted EPS of $1.44 to $1.46.
The Company’s fourth quarter and full fiscal year 2015 diluted EPS estimates assume an average share count of approximately 29.8 million and 29.6 million respectively, (assuming no further exercises of stock-based awards) and assume a stock price of $38.14, which was derived from the average closing price of the Company’s stock over the five trading days ended on February 3, 2015. Deviations from this stock price may cause actual EPS to vary based on share dilution from Virtusa’s stock options and stock appreciation rights.