Oracle Financial Services Software Limited

Transcription

1 UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET AS AT SEPTEMBER 30, 2011 September 30, 2011 March 31, 2011 SOURCES OF FUNDS Shareholders' funds Share capital 419, ,474 Share application money pending allotment 1, Reserves and surplus Securities premium 9,622,835 9,574,474 General reserve 10,145,191 10,145,191 Foreign currency translation reserve (835,256) (803,614) Gain on dilution of equity investment in joint venture Profit and loss account 38,849,081 34,720,175 Deferred tax liability 88,097 91,558 58,291,570 54,148,940 APPLICATION OF FUNDS Fixed assets Gross block 12,670,448 12,829,313 Less: Accumulated depreciation and amortisation / impairment 3,510,330 3,483,556 Net book value 9,160,118 9,345,757 Capital work-in-progress and advances 1,011, ,699 10,171,498 9,985,456 Investments Current investments (quoted) 9,982 9,982 Deferred tax assets 1,128, ,240 Current assets, loans and advances Sundry debtors 8,647,033 8,205,607 Cash and bank balances 33,415,261 29,023,468 Other current assets 4,463,163 3,975,907 Loans and advances 8,888,283 9,337,559 55,413,740 50,542,541 Less: Current liabilities and provisions Current liabilities 5,942,111 5,625,499 Provisions 2,489,818 1,518,780 8,431,929 7,144,279 Net current assets 46,981,811 43,398,262 58,291,570 54,148,940 Notes attached herein form an integral part of the unaudited condensed balance sheet.

2 UNAUDITED CONDENSED CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE THREE AND SIX MONTH PERIOD ENDED SEPTEMBER 30, 2011 (Amounts in ` thousands, except share and per share data) Three month period ended Six month period ended September 30, September 30, Revenue 7,561,739 7,435,965 14,682,498 13,939,433 Cost of revenue (3,703,983) (3,366,966) (7,290,953) (6,632,562) Gross profit 3,857,756 4,068,999 7,391,545 7,306,871 Operating expenses Selling and marketing expenses (698,600) (646,537) (1,281,132) (1,256,894) General and administrative expenses (675,648) (609,394) (1,331,487) (1,260,472) Depreciation and amortisation (98,691) (90,958) (199,400) (201,901) Operating profit 2,384,817 2,722,110 4,579,526 4,587,604 Interest income 657, ,543 1,264, ,373 Foreign exchange gain, net 739,364 34, , ,034 Other (expense) income, net (3,236) 3,188 (6,430) 12,032 Profit before exceptional item and provision for taxes 3,778,316 3,058,424 6,723,007 5,213,043 Exceptional item [Refer note 3(ii)] (865,553) (122,067) (865,553) (122,067) Profit before provision for taxes 2,912,763 2,936,357 5,857,454 5,090,976 Provision for taxes Current tax (1,207,696) (636,147) (2,107,314) (1,179,993) MAT credit - 332, ,801 Deferred tax 381,668 2, ,766 2,831 Net profit for the period 2,086,735 2,635,181 4,128,906 4,568,615 Earnings per share of ` 5/- each (in `) Basic Diluted Number of shares used in computing earnings per share Basic 83,930,560 83,878,938 83,915,249 83,871,526 Diluted 83,998,357 83,992,704 83,997,877 83,983,122 Notes attached herein form an integral part of the unaudited condensed profit and loss account.

3 Notes annexed to and forming part of the unaudited condensed accounts for the three and six month period ended September 30, 2011 (Amount in ` thousands, except options & per option price) 1. Background and nature of operations Oracle Financial Services Software Limited ( OFSS or the Company ) was incorporated in India with limited liability on September 27, The Company along with its subsidiaries and associate is principally engaged in the business of providing information technology solutions and business process outsourcing services to the financial services industry worldwide. OFSS has a suite of banking products, which caters to the needs of corporate, retail, investment banking, treasury operations and data warehousing. Oracle Financial Services Software Limited is a subsidiary of Oracle Global (Mauritius) Limited ( Oracle ) with Oracle having 80.40% ownership interest in the Company as at September 30, The Company has following subsidiaries and associate (hereinafter collectively referred as the Group ): Ownership Companies Country of Incorporation Interest Relationship Direct holding Oracle Financial Services Software B.V. The Netherlands 100% Subsidiary Oracle Financial Services Software Pte. Ltd. Singapore 100% Subsidiary Oracle Financial Services Software America, Inc. United States of America 100% Subsidiary ISP Internet Mauritius Company Oracle (OFSS) Processing Services Limited Republic of Mauritius India 100% 100% Subsidiary Subsidiary Oracle (OFSS) ASP Private Limited India 100% Subsidiary Oracle Financial Services Software Chile Limitada Chile 100% Subsidiary Oracle Financial Services Software (Shanghai) Limited Republic of China 100% Subsidiary Login SA France 33% Associate Subsidiaries of Oracle Financial Services Software America, Inc. Oracle Financial Services Software, Inc. United States of America 100% Subsidiary i-flex solutions Inc. (Canada) (dissolved on Canada 100% Subsidiary March 31, 2011) Mantas Inc. United States of America 100% Subsidiary Subsidiaries of Mantas Inc. Mantas Limited United Kingdom 100% Subsidiary Sotas Inc. United States of America 100% Subsidiary Mantas Singapore Pte. Ltd. Singapore 100% Subsidiary Subsidiaries of Sotas Inc. Mantas India Private Limited India 100% Subsidiary Subsidiaries of i-flex solutions Inc. (Canada) Castek Inc. (dissolved on September 1, 2010) United States of America 100% Subsidiary Castek Software Factory Ltd. (dissolved on United States of America 100% Subsidiary September 1, 2010) Castek RBG Inc. (dissolved on September 1, 2010) United States of America 100% Subsidiary Subsidiary of Oracle Financial Services Software B.V. Oracle Financial Services Software SA Greece 100% Subsidiary Subsidiary of Oracle Financial Services Software Pte ltd. Oracle Financial Services Consulting Pte. Ltd. Singapore 100% Subsidiary Subsidiaries of ISP Internet Mauritius Company Oracle (OFSS) BPO Services Inc. (formerly known as United States of America 100% Subsidiary i-flex Processing Services Inc.) Oracle (OFSS) BPO Services Limited India 100% Subsidiary

4 Notes annexed to and forming part of the unaudited condensed accounts for the three and six month period ended September 30, 2011 (Amount in ` thousands, except options & per option price) 2. Accounting policies The Group has followed the same accounting policies in preparing the interim financial statements as were followed for the year ended March 31, Commitments and contingent liabilities ( i ) Capital Commitments Particulars September 30, 2011 March 31, 2011 Contracts remaining to be executed on capital account not provided for (net of advances) including capital commitment through issuance of letter of intents of ` Nil (March 31, ` 343,038). 730, ,973 (ii) Contingent liabilities A customer has filed a lawsuit against the Company and one of its subsidiaries, claiming damages of upwards of ` 5,592,804. While the claims are being rigorously defended by the Company and counter claims raised against the customer for breach of contract and outstanding fees, a mediation process has been initiated by the parties concerned. In respect of this claim, the Company has provided ` 865,553 and ` 122,067 in the three month period ended September 30, 2011 and September 30, 2010 respectively and has disclosed the same as an exceptional item in the financial results for the three month period ended September 30, In respect of this matter, future cash outflow is determinable only on settlement of this case.

5 Notes annexed to and forming part of the unaudited condensed consolidated accounts for the three and six month period ended September 30, SEGMENT INFORMATION The Group is organized by business segment and geographically. For management purposes the Group is primarily organised on a worldwide basis into three business a) Product licenses and related activities ('Products') and b) IT solutions and consulting services ('Services') c) Business Processing Services ('BPO-Services') Three month period ended September 30, 2011 Particulars Products Services BPO - Services Corporate Eliminations Total Revenue External revenue 5,244,680 2,117, , ,561,739 Inter-segment revenue ,477 - (55,477) - Total revenue 5,244,680 2,117, ,685 - (55,477) 7,561,739 Cost of revenue (2,420,573) (1,207,633) (75,777) - - (3,703,983) Gross profit 2,824, , ,908 - (55,477) 3,857,756 Selling and marketing expenses (595,797) (94,349) (8,454) - - (698,600) General and administrative expenses (188,466) (74,856) (41,016) (371,310) - (675,648) Depreciation and amortisation (33,474) (34,577) (5,210) (25,430) - (98,691) Inter segment expense - (55,477) ,477 - Segment Results 2,006, , ,228 (396,740) - 2,384,817 Interest income 657,371 Foreign exchange gain, net 739,364 Other expenses, net (3,236) Profit before exceptional item and provision for taxes 3,778,316 Exceptional item [Refer note 3(ii)] (865,553) Profit before provision for taxes 2,912,763 Provision for taxes (826,028) Net profit 2,086,735 Other information Capital expenditure by segment 8,761 5, ,789-29,181 Other non cash expenses 26,163 (6,178) ,985 Segment assets 16,612,937 4,270, ,996 45,598,227-66,723,499 Segment liabilities 5,176, , ,196 2,600,685-8,520,026 Shareholders' funds ,203,473-58,203,473 Three month period ended September 30, 2010 Particulars Products Services BPO - Services Corporate Eliminations Total Revenue External revenue 5,027,651 2,292, , ,435,965 Inter-segment revenue ,679 - (66,679) - Total revenue 5,027,651 2,292, ,478 - (66,679) 7,435,965 Cost of revenue (1,735,854) (1,563,338) (67,774) - - (3,366,966) Gross profit 3,291, , ,704 - (66,679) 4,068,999 Selling and marketing expenses (553,188) (76,674) (16,675) - - (646,537) General and administrative expenses (180,394) (101,232) (35,990) (291,778) - (609,394) Depreciation and amortisation (32,325) (41,925) 2,344 (19,052) - (90,958) Inter segment expense - (66,679) ,679 - Segment Results 2,525, ,667 64,383 (310,830) - 2,722,110 Interest income 298,543 Foreign exchange gain, net 34,583 Other income, net 3,188 Profit before exceptional item and provision for taxes 3,058,424 Exceptional item [Refer note 3(ii)] (122,067) Profit before provision for taxes 2,936,357 Provision for taxes (301,176) Net profit 2,635,181 Other information Capital expenditure by segment 8,990 21, ,567-36,989 Other non cash expenses 96,926 (3,705) ,221 Segment assets 12,593,535 3,936, ,427 36,786,386-53,564,699 Segment liabilities 3,056, , ,125 1,927,390-6,058,907 Shareholders' funds ,505,792-47,505,792

6 Notes annexed to and forming part of the unaudited condensed consolidated accounts for the three and six month period ended September 30, 2011 Six month period ended September 30, 2011 Particulars Products Services BPO - Services Corporate Eliminations Total Revenue External revenue 10,054,597 4,355, , ,682,498 Inter-segment revenue ,587 - (115,587) - Total revenue 10,054,597 4,355, ,272 - (115,587) 14,682,498 Cost of revenue (4,592,150) (2,542,418) (156,385) - - (7,290,953) Gross profit 5,462,447 1,812, ,887 - (115,587) 7,391,545 Selling and marketing expenses (1,101,572) (162,493) (17,067) - - (1,281,132) General and administrative expenses (365,822) (170,121) (80,324) (715,220) - (1,331,487) Depreciation and amortisation (69,284) (78,995) (10,820) (40,301) - (199,400) Inter segment expense - (115,587) ,587 - Operating profit 3,925,769 1,285, ,676 (755,521) - 4,579,526 Interest income 1,264,981 Foreign exchange gain, net 884,930 Other expenses, net (6,430) Profit before exceptional item and provision for taxes 6,723,007 Exceptional item [Refer note 3(ii)] (865,553) Profit before provision for taxes 5,857,454 Provision for taxes (1,728,548) Net profit 4,128,906 Other information Capital expenditure by segment 10,198 6, ,445-37,154 Other non cash expenses (24,242) (36,169) (60,411) Segment assets 16,612,937 4,270, ,996 45,598,227-66,723,499 Segment liabilities 5,176, , ,196 2,600,685-8,520,026 Shareholders' funds ,203,473-58,203,473 Six month period ended September 30, 2010 Particulars Products Services BPO - Services Corporate Eliminations Total Revenue External revenue 9,015,885 4,696, , ,939,433 Inter-segment revenue ,344 - (128,344) - Total revenue 9,015,885 4,696, ,717 - (128,344) 13,939,433 Cost of revenue (3,462,074) (3,045,768) (124,720) - - (6,632,562) Gross profit 5,553,811 1,650, ,997 - (128,344) 7,306,871 Selling and marketing expenses (1,059,769) (157,580) (39,545) - - (1,256,894) General and administrative expenses (364,182) (222,522) (75,210) (598,558) - (1,260,472) Depreciation and amortization (77,729) (79,104) (9,125) (35,943) - (201,901) Inter segment expense - (128,344) ,344 - Operating profit 4,052,131 1,062, ,117 (634,501) - 4,587,604 Interest income 510,373 Foreign exchange gain, net 103,034 Other income, net 12,032 Profit before exceptional item and provision for taxes 5,213,043 Exceptional item [Refer note 3(ii)] (122,067) Profit before provision for taxes 5,090,976 Provision for taxes (522,361) Net profit 4,568,615 Other information Capital expenditure by segment 20,316 37, ,134-76,955 Other non cash expenses 146,589 (1,964) 4, ,119 Segment assets 12,593,535 3,936, ,427 36,786,386-53,564,699 Segment liabilities 3,056, , ,125 1,927,390-6,058,907 Shareholders' funds ,505,792-47,505,792

7 Notes annexed to and forming part of the unaudited condensed consolidated accounts for the three and six month period ended September 30, Aggregate expenses Three month period ended Six month period ended September 30, September 30, Salaries and bonus [Refer note 6] 3,453,531 2,880,632 6,787,690 5,801,057 Staff welfare expenses 130, , , ,562 Contribution to provident and other funds 137, , , ,302 Travel related expenses (net of recoveries) 317, , , ,991 Professional fees 526, ,781 1,017, ,005 Application software 32,776 40,733 66,184 71,368 Communication expenses 54,738 70, , ,204 Rent 205, , , ,815 Advertising expenses 6,022 3,321 14,407 14,728 Power 58,854 56, , ,647 Insurance 6,046 4,854 12,061 9,740 Repairs and maintenance: Buildings and leasehold premises 4,506 5,285 9,995 11,481 Computer equipments 9,407 15,411 22,512 29,020 Others 14,298 18,933 30,227 32,308 Rates and taxes 36,059 9,959 54,287 22,497 Finance charge on leased assets ,070 Provision for doubtful debts, net 18,371 93,181 (62,025) 149,079 Bad debts 1, , Other expenses 62,619 62, , ,014 5,078,231 4,622,897 9,903,572 9,149, Employee costs for the three and six month period ended September 30, 2010 are net of ` 238,418 pertaining to write back of bonus provision of earlier year, no longer required due to changes in compensation policy of the Company. Prior period's figures have been reclassified, where necessary to conform with current period's presentation.

8 UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW FOR THE SIX MONTH PERIOD ENDED SEPTEMBER 30, 2011 Six month period ended September 30, Net cash provided by operating activities 3,121,825 2,976,167 Net cash (used in) investing activities (2,411,182) (6,408,730) Net cash provided by financing activities 43,454 27,829 Net increase / (decrease) in cash and cash equivalents 754,097 (3,404,734) Cash and cash equivalents at beginning of the period 3,318,578 6,854,470 Effect of exchange difference on cash and bank balances 280, ,642 Cash and cash equivalents at end of the period 4,352,775 3,627,378 Cash and bank balances as per balance sheet * 33,415,261 25,255,765 Less: Bank deposits having maturity of more than 90 days (29,055,844) (21,621,787) Margin money deposit account (6,642) (6,600) Cash and cash equivalents at end of the period 4,352,775 3,627,378 * Includes amount kept in unclaimed dividend accounts of ` 2,215 (September 30, 2010 ` 1,535) not available for use by the Company and ` 52,444 held with Central Bank of Libya which are not freely remissible to the Group due to unstable conditions in Libya.