This morning a California jury delivered a verdict in a lawsuit that has been pending for over four years in District Court (USA). The lawsuit involved various claims brought by Copart, Inc. against Sparta Consulting, Inc., KPIT Infosystems, Inc. and KPIT Technologies Ltd., and Sparta Consulting, Inc.’s claims against Copart, Inc. While we do not yet have a copy of the jury’s written decision (the “verdict form”), what we understand from the oral proceedings in court yesterday is that the jury awarded damages to both Sparta and Copart with respect to their respective claims. We understand the net result is an amount owing to Copart, Inc. approximately US $ 16 M. The court set a further hearing on July 13, 2018, at which time the parties’ respective motions regarding the jury’s decision will be considered. After those motions are heard and considered, the court will issue its final written judgment.
Even before the jury issued its verdict, the court had previously ruled that any direct claims against KPIT Technologies Ltd. should be dismissed as a matter of law.
Sparta and KPIT Infosystems continue to vigorously deny any and all wrongdoing, and will continue to explore all possible challenges to the verdict.
Our $ revenue for the quarter stood at $150.2 Million, a Q-o-Q growth of 6.4% and Y-o-Y growth of 17.1%. In Rs. terms revenue grew by 5.9% Q-o-Q and 12.6% Y-o-Y to Rs. 9,664.3 Million.
Amongst SBUs, there was a significant Q-o-Q growth in P&P SBU as it grew by 50% while PES and DT SBU grew by 12% and 6.3% respectively. IES SBU grew marginally by 0.3% on a Q-o-Q basis while SAP SBU declined by 2.1%. On an annual basis for FY18, P&P SBU grew by 53.8% while PES grew by 32.3%. DT and IES SBU grew by 15.3% and 5.9% respectively. There was a marginal decline of 0.8% in SAP SBU.
Amongst geographies, APAC was the highest growing geography with 14.3% Q-o-Q growth while Europe grew by 11.2% and US grew by 2.8%. On an annual basis for FY18, Europe was the highest growing geography with 36.3% followed by APAC which grew by 28.7% and US which grew by 6.5%.
In terms of industry verticals, manufacturing grew by 9% while Automotive & Transportation vertical grew by 6.8%. There was a sequential growth of 3.8% in Energy & Utilities vertical. On an annual basis for FY18, Energy & Utilities grew by 39.4% while Automotive & Transportation vertical grew by 23%. There was a marginal decline of 2% in manufacturing vertical.
On a Q-o-Q basis our top customer grew by 6% with revenue share of 12.1%. The 20 top strategic accounts constituted 51.8% of the total revenues and grew by 8.6%. Similarly, the 40 top strategic accounts constituted 63.1% of the revenues and had a Q-o-Q growth of 9.5%. For FY18, the top client grew by 10% while there was a growth of 32.7% and 25% in Top 20 and Top 40 strategic clients respectively.
*All the revenue growth numbers mentioned under revenue update are in equivalent $ terms.
The realized rate for the quarter was Rs. 64.35 /$ against Rs. 64.64/$ in Q3 FY18.
The offshore revenues grew faster during the quarter and employee productivity also showed a steady increase resulting in increased offshore utilization. Higher engineering revenues also resulted in a higher offshore realized billing rate during the quarter. There was an increase in the Business IT profitability during the quarter and we see it increasing steadily. We have done significant R&D and new solutions development investments both in Engineering as well as Business IT, albeit tilted more towards engineering, which had some impact on the engineering profitability for the quarter.
We will continue to focus on improving people utilization, productivity and revenue mix leading to steady improvement in operating profitability over the next year.