Mindtree Profit Slumps As Large Client Spending Falls
Technology services company Mindtree Ltd. witnessed a 22.8 percent decline in profit for the second quarter of financial year 2017.
Net profit for the July-September quarter declined to Rs 95 crore from Rs 123 crore in the previous quarter. The consensus of analyst estimates tracked by Bloomberg stood at Rs 114 crore.
Revenue in the second quarter decreased 2.5 percent to Rs 1,295 from Rs 1,328 crore in the first quarter.
Earnings before interest and taxes fell 21.6 percent to Rs 116 crore versus Rs 148 crore on a sequential basis. The EBIT margin contracted by 210 basis points to 9 percent.
The company's revenue across all its verticals declined on a quarterly basis due to slower spending by its large clientele.
The volatile macroeconomic environment has resulted in slower ramp-ups and cautious spending in a few large clients across our verticals.Rostow Ravanan, CEO & Managing Director, Mindtree
Mindtree has a total of six $25 million clients, of which they added one during the quarter.
The company has recommended an interim dividend of Rs 3 per equity share of value Rs 10 each for the quarter.