Virtusa announces 3Q fiscal 2016 consolidated financial results

Virtusa Corporation, a global business consulting and information technology (IT) outsourcing company that combines innovation, technology leadership and industry solutions to transform the customer experience, reported consolidated financial results for the third quarter fiscal year 2016, ended December 31, 2015.

Revenue for the third quarter of fiscal 2016 was US $ 150.6 million, an increase of 5 percent sequentially and 22 percent year-over-year (YoY). On a constant currency basis, third quarter revenue increased 6 percent sequentially and 23 percent YoY.

Virtusa reported GAAP income from operations of US $ 14.1 million for the third quarter of fiscal 2016, compared to US $ 13.3 million for the second quarter of fiscal 2016 and US $ 14.6 million for the third quarter of fiscal 2015.

GAAP net income for the third quarter of fiscal 2016 was US $ 11.3 million, or US $ 0.38 per diluted share, compared to US $ 11.1 million, or US $ 0.37 per diluted share, for the second quarter of fiscal 2016, and compared to US $ 11.8 million, or US $ 0.40 per diluted share, for the third quarter of fiscal 2015.

In the third quarter of fiscal 2016, Virtusa incurred approximately US $ 1.2 million, or US $ 0.02 per diluted share, of transaction expenses related to the proposed acquisition of a majority interest in Polaris Consulting & Services Ltd, compared to the prior guidance of US $ 0.6 million, or US $ 0.01 per diluted share.

The company ended the third quarter of fiscal 2016 with US $ 201.2 million of cash, cash equivalents and short-term and long-term investments.  Virtusa’s fiscal third quarter ending cash balance excludes US $ 20.3 million of restricted cash held in escrow for the mandatory unconditional offer related to the proposed acquisition of a majority interest in Polaris Consulting & Services Ltd.  Cash flow from operations for the third quarter of fiscal 2016 was US $ 22.4 million.

Virtusa Chairman and CEO Kris Canekeratne stated, “I am pleased with our fiscal third quarter performance. While we faced some unexpected challenges brought on by the Chennai floods, outstanding execution by our local team enabled us to navigate this event with minimal interruption to our critical business operations.

From a demand perspective, corporations are increasingly investing in IT solutions which enable them to run their business more efficiently, secure the business and grow the business. Virtusa’s value proposition of delivering industry-leading, transformational services and solutions that squarely addresses these critical business objectives continues to resonate in the market and is enabling us to win market share.”