Persistent Systems margin takes a hit, forex saves

Pune-based Persistent Systems reported a decline in its revenue from IT infrastructure segment, but managed to report a flat quarter on quarter revenue growth due to some pick up in its Telecom revenue.

Persistent also reported a decline in its margins, led by higher salary expenses in the June quarter.

Employee costs rose 1.5% on quarter to 54.3% of total sales from 52.1% of total sales during the preceding three months.

Similarly travel costs rose 41% to 4.1% of sales from 2.9% of sales three months back.

In all, EBITDA margin fell drastically to 21.8% of sales from 27% in the previous quarter. However, the company reported good forex related numbers with a gain of 13.3 crore during the quarter versus a loss of 8.6 crore in the previous quarter.

This helped the company report a 2.4% sequential increase in net profit to 68.8 crore.

The company’s products business increased its share of revenue to 20% for the first time, from 19.6%.