NIIT Limited Q1 Consolidated Results 2006-07

Reprioritisation of business lines yields accelerated growth in Individual and Corporate Businesses

 

  • Individual Learning Business growth accelerates to 33 per cent YoY
  • Corporate business grows 17 per cent YoY
  • Operating margin improves by 51 basis points to 14 per cent
  • GNIIT enrolments up 156 per cent; AAE enrolments up 122 per cent
  • Corporate business order intake of US $15.15 million

 

New Delhi, July 27, 2006: In line with its defined strategy of reprioritising of business lines, NIIT Limited has reported accelerated growth in its individual and corporate businesses in the first quarter of the financial year 2006-07. While the company’s individual business recorded a 33 per cent year on year revenue growth during the April to June quarter, the corporate business accelerated to a 17 per cent YoY. The strong growth in the individual learning business came on the back of strong enrolment growth in GNIIT and the Engineers’ programmes. While GNIIT enrolments went up 156 per cent, the AAE (Advanced programme for Engineers) enrolments went up 122 per cent during the first quarter of the financial year.

 

The order intake for the corporate business during the quarter was $15.15 million. Including a multi-million dollar contract from a large technology company.

 

NIIT’s reported net consolidated revenues of Rs. 110.2 crore this quarter, compared to Rs. 106.4 crore in the corresponding period last financial year. The company’s global systemwide revenues stood at Rs. 163.7 crore (Rs. 156.6* crore in Q1  of 2005-06). The company’s recorded operating profit of Rs. 15.4 crore compared to Rs. 14.3 crore last year. Operating margin at 14 per cent represents an improvement of 51 basis points. Net profit at Rs. 13.2 crore during the quarter led to a basic earning per share of Rs. 6.8.

 

* Previous period figures have been recast for comparative purposes.

Of the global revenues of Rs. 163.7 crore, NIIT’s overseas operations contributed 46 per cent with India making up the remaining 54 per cent. While the individual learning business contributed 63 per cent of the overall revenues, the corporate and institutional businesses accounted for 27 and 10 per cent respectively.

 

Commenting on the growth of the individual and corporate business lines, Rajendra S. Pawar, the Chairman of NIIT Limited, said: “The reprioritisation of our business lines led to an improvement of 51 basis points in our operating margin. This was in keeping with the strategy we spelt out last quarter.”

 

The results were taken on record at the Board of Directors’ meeting of the company here today.

 

New Businesses

NIIT has identified three new areas of growth in the rapidly emerging services sector. The first of these is setting up of the Institute for Finance, Banking and Insurance (IFBI) to prepare professionals, both at the entry level as well as in-service training for experienced professionals, for the fast growing BFSI industry.

NIIT Imperia, Centres for Advanced Learning, will offer advanced training programmes in executive management and technology education in association with prestigious institutions using synchronous learning technology. The third business, NIIT Litmus, will offer assessment and testing services for recruitment and proficiency testing initially focusing on the BPO and IT space.

 

P. Rajendran, Chief Operating Officer, said: “The three new businesses will deploy our core competency in offering technology based learning to capture the market opportunities offered by the growing services sector.”

 

NIIT’s private schools business grew 24 per cent YoY and contributed to 30 per cent of the institutional business. This is a part of the company’s strategy of optimising risk levels in the school education space. The five-year project for computer training in 700 Karnataka Government schools was completed successfully last quarter. This year NIIT is being selective in taking on new government school projects from state governments, while aggressively focusing on growth through private school offerings.

 

Vijay K. Thadani, Chief Executive Officer, said: “Based on the improvement in leading indicators of its performance in the year’s first quarter, NIIT is well on track to achieve higher revenue growth than the last financial year coupled with improved profitability.”

 

Acknowledgements

According to the Dataquest annual survey, NIIT significantly strengthened its position in the Rs. 1,453 crore Indian IT training sector. NIIT’s 2005-06 revenues made it 3.72 times the size of its nearest competitor.

 

About NIIT

NIIT, an acknowledged leader in the IT and IT-assisted training space, offers learning and knowledge solutions in over 30 countries. Leading IT magazine Dataquest has conferred upon NIIT, the 'Top Training Company Award' 2005.

 

Rated among India's Superbrands, NIIT's education offerings include: GNIIT, an industry-endorsed programme for students seeking careers in the IT and BPO segments; CATS, which offers training programmes on advanced technologies for IT professionals; Swift, a platform for equipping people with basic computer skills.

 

In the Corporate Solutions Business, NIIT’s offerings are bolstered by its SEI CMM Level 5 assessed learning services capability. The Corporate Solutions Business offers integrated learning solutions that include strategic consulting, learning design, content development, learning delivery, learning technology services and learning administration.

 

Its customers include many Fortune 500 companies, universities, technology companies, training corporations and publishing houses.

 

 

Investors may contact:

Chetna Khuller, NIIT Ltd., Phone: +91 124 429 3335, Fax: +91 124 429 3333, Chetnak@niit.com