Fourth Quarter Fiscal 2014 Consolidated Financial Results
Revenue for the fourth quarter of fiscal 2014 was $111.1 million, an increase of 10% sequentially and 24% year-over-year in reported currency. On a constant currency basis,(1) fourth quarter revenue increased 9% sequentially and 22% year-over-year.
Virtusa reported income from operations of $12.5 million for the fourth quarter of fiscal 2014, an increase compared to $11.2 million for the third quarter of fiscal 2014, and an increase compared to $9.4 million for the fourth quarter of fiscal 2013.
Net income for the fourth quarter of fiscal 2014 was $10.0 million, or $0.35 per diluted share, compared to $9.3 million, or $0.35 per diluted share, for the third quarter of fiscal 2014, and compared to $9.1 million, or $0.35 per diluted share, for the fourth quarter of fiscal 2013.
Fiscal Year 2014 Consolidated Financial Results
For the fiscal year ended March 31, 2014, revenue increased 19% in both reported and constant currency, to a record $396.9 million, compared to $333.2 million for the fiscal year ended March 31, 2013.
Virtusa reported income from operations of $42.4 million for fiscal year 2014, an increase of 29% compared to $32.9 million for fiscal year 2013.
Net income for fiscal year 2014 was $34.4 million, or $1.27 per diluted share, an increase compared to $28.4 million, or $1.11 per diluted share, for fiscal year 2013.
The Company ended fiscal year 2014 with $200.7 million of cash, cash equivalents, and short-term and long-term investments.(2) Cash generated from operations was $9.4 million for the fourth quarter and $48.9 million for the fiscal year 2014.
Kris Canekeratne, Virtusa’s Chairman and CEO, stated, “We are pleased with our fourth quarter and full fiscal year results, which reinforce that our strategic initiatives designed to differentiate our value proposition, grow our existing client base, expand geographically and enhance our service delivery are paying off. By being able to address the duality our clients are facing by helping them innovate new solutions and transform their operating costs, the market opportunity for Virtusa continues to grow. As we look to fiscal year 2015, our objectives are very much aligned with the success we have been having and we are optimistic about our growth trajectory.”
Ranjan Kalia, Chief Financial Officer, said, “During the quarter, our revenue grew faster than the industry, as we had meaningful increases across our Top 10 and non-Top 10 client portfolios. We are also pleased with the progress we are making to extend our presence internationally. There has been a mix shift towards international revenue, and we believe this diversification will continue to be a growth driver.” Mr. Kalia added, “Consistent with prior fiscal years, we expect operating margin expansion in fiscal year 2015 as we drive significant top line growth.”
Virtusa management provided the following current financial guidance:
First quarter fiscal year 2015 revenue is expected to be in the range of $111.0 to $113.0 million, with diluted EPS of $0.29 to $0.33.
Fiscal year 2015 revenue is expected to be in the range of $468.0 to $486.0 million, with diluted EPS of $1.44 to $1.60.
The Company’s first quarter and fiscal year 2015 diluted EPS estimates both assume an average share count of approximately 29.4 million, (assuming no further exercises of stock-based awards) and assume a stock price of $33.38, which was derived from the average closing price of the Company’s stock over the five trading days ended on May 9, 2014. 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 12, 2014 at 5:00 pm Eastern time to discuss the Company’s fourth fiscal quarter and full fiscal year 2014 financial results, current financial guidance, and other corporate developments. To access this call, please dial 888-293-6960 (domestic) or 719-325-2352 (international)
Virtusa provides end-to-end information technology (IT) services to Global 2000 companies. These services, which include IT consulting, application maintenance, development, systems integration and managed services, leverage a unique Platforming methodology that transforms clients’ businesses through IT rationalization. Virtusa helps customers accelerate business outcomes by consolidating, rationalizing, and modernizing their core customer-facing processes into one or more core systems.
Virtusa delivers cost-effective solutions through a global delivery model, applying advanced methods such as Agile and Accelerated Solution Design to ensure that its solutions meet the clients’ requirements. As a result, its clients simultaneously reduce their IT operations cost while increasing their ability to meet changing business needs.
Founded in 1996 and headquartered in Massachusetts, Virtusa has operations in North America, Europe, and Asia.
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