RS Software Q3 net profit up 26%

RS Software India Ltd, the leading vertically integrated technology solution provider to the global electronic payments industry; today announced its results for the third quarter ended December 31, 2014.

The company’s consolidated PAT rose 25.85% to Rs. 17.62 crore in Q3FY15 compared to Rs. 14.00 crore in Q3FY14.

EBIDTA stood at Rs. 26.46 crore from Rs. 22.14 crore in the same period last year & EBIDTA margin was 27 % in Q3FY15 compared to 23 % Q3FY14.

Earnings per share (EPS) for the quarter are Rs. 13.75 against Rs. 11.39 in the same quarter of the previous year.

Commenting on the results, Raj Jain, Chairman & Managing Director, RS Software India Ltd said, “Our third quarter has achieved a record profit in the history of the company, highest profit after taxes, with EBIDTA margins at 27% as compared to 23% during the same quarter in the last fiscal year. This has been possible due to significant shift of business execution to India location, which does reward superior contribution but has the impact of lowering the top line, and hence revenue growth is 2%. The board has announced an interim dividend of 15%, which again creates a record for a cumulative interim dividend in a period of 9 months. The networth of the company has also gone up by 30% and profit after taxes have gone up by 36% as compared to 9 months of the last fiscal year.

The company is confident of achieving good returns for its shareholders for the long term. At its board meeting on 16th January the company has taken the decision to expand its strategy to leverage the next big opportunity in the payments industry, while accelerating lowering of the risk it has of client concentration.

According to Mckinsey the well-defined and well-bounded payments industry is rapidly becoming history. Indeed, it is becoming part of a much wider commerce ecosystem that comprises a host of well-established players and entrants, each flexing their unique strengths as they pursue what is fast becoming the holy grail of commerce. This is increasing significantly the growth potential for the trillion dollar payments industry. RS Software is committed to participate in building the digital payments infrastructure, just as it continues to build and enhance the electronic payment infrastructure for the brick and mortar retail.

The company is committed to achieving long term return to its shareholders. This strategy is all about the long term.  The winners in this evolution of payments industry might not be its strongest or most strategically savvy players, but rather those who respond best to industry change and market feedback. While Mcommerce is a little over 1% of the total retail today, but it has grown just in the last two years from 11% to 19% of Ecommerce. RS Software has taken the decision to transition its strategy to achieve its dual objective of progressing from  “pure outsourcer” model to a hybrid with new recurring product/services revenue streams – still within payments industry – via strategic partnerships, JVs, M&A.  Our decisions will be driven with focus on the long term value for our shareholders.” he further added.