Persistent Systems reports 7% rise in net profit at Rs 88 crore in Q2

Tech firm Persistent Systems on October 21 reported a 7 percent rise in its consolidated net profit to Rs 88.14 crore for the second quarter ended September 2018. The company had registered a net profit of Rs 82.62 crore in the July-September period of 2017-18.

Total income of the company increased to Rs 858.78 crore in the September quarter of 2018-19 as against Rs 794.89 crore in the year-ago period, it said in a regulatory filing.

Segment-wise, revenue from Technology services were up 11 percent and that of Alliance was up 18.5 percent. Its revenue from Accelerite (products) during the quarter fell by 27 percent

The company said it recognised itself into these three business units from April 1, 2018 which form the operating segments for revenue break-up.

Persistent said its wholly owned subsidiary Persistent Systems Inc has completed the acquisition of Herald Technologies Inc, a US-based healthcare start-up on August 24, 2018 and the second quarter results also include business from Herald.

Among others, the company said that it has deposits with IL&FS group firm the interest on which has not been defaulted by the latter and it will continue to monitor the related matters.

"As of September 30, 2018, Persistent Systems Limited had deposits of Rs 430 million with the financial institutions Infrastructure Leasing & Financial Services Ltd (IL&FS) and IL&FS Financial Services Ltd. These are due for maturity from January 2019 to June 2019. As of September 30, 2018, there have been no defaults in payment of interest on the aforesaid deposits," it said.

Accordingly, the management of the Persistent Systems believes that there is no immediate need to recognize any impairment on these deposits.

The company will continue to monitor the developments in this matter for the purpose of determining the financial reporting impact, if any," it said.

In August, credit rating agency ICRA had significantly downgraded the IL& FS Group's rating and subsequently the government and various regulators have intervened in the matter.