BWI: Sapient Reports First Quarter 2010 Results

Press release from Business Wire India
Source: Sapient
Friday, May 07, 2010 04:34 PM IST (11:04 AM GMT)
Editors: General: Consumer interest, Economy; Business: Business services, Financial Analyst, Information technology, Stock exchanges; Technology
--------------------------------------------------
Sapient Reports First Quarter 2010 Results
Service Revenues Up 29%Year Over Year; First Quarter Non-GAAP Operating Margin of 8.1%

Gurgaon, Haryana, Noida, Uttar Pradesh and Bangalore, Karnataka, India, Friday, May 07, 2010 -- (Business Wire India) -- Sapient (NASDAQ: SAPE) today reported the following financial results for the first quarter ended March 31, 2010:

. Service revenues were $183.2 million compared to $142.4 million in the first quarter of 2009, an increase of 29%. Sequentially, service revenues were down $300,000 from $183.5 million in the fourth quarter of 2009. On a constant currency basis, revenues increased 24% over the first quarter of 2009 and 1% sequentially.

. GAAP income from operations was $9.0 million, or 4.9% of service revenues, up 80% from $5.0 million, or 3.5% of service revenues, reported in the first quarter of 2009.

. Non-GAAP income from operations was $14.8 million, or 8.1% of service revenues. This compared to $11.2 million, or 7.9% of service revenues, in the first quarter of2009.

. GAAP diluted net income per share was$0.05, compared to $0.03 in the first quarter of 2009.

. Non-GAAP diluted net income per share was $0.07, compared to $0.06 in the first quarter of 2009.

"We are pleased with our strong results this quarter," said Sapient President and Chief Executive Officer Alan J. Herrick. "At the beginning of the year, we aligned our organizational structure with our go-to-market strategy enabling us to emphasize our unique capabilities. Clients have responded well and we are seeing strong demand across every segment of our business."

The company used cash from operations of $6.1 million in the first quarter of 2010, compared to $29.5 million in the first quarter of 2009. As of March 31, 2010, the company had cash, cash equivalents and marketable securities of $159.6 million. Days sales outstanding was 71 days for the first quarter of 2010, up from 66 days in the fourth quarter of 2009 but down from 78 days for the first quarter of 2009.

Outlook

Sapient management provided the following guidance:

. For the second quarter ending June 30, 2010, service revenues are expected to be $194.0 million or higher.

. Second quarter non-GAAP operating margin is expected to be 9.5% or higher.

Adjusted (Non-GAAP) Financial Measures

Sapient provides non-GAAP financial measures to complement reported GAAP results. Management believes these measures help illustrate underlying trends in the company's business and uses the measures to establish budgets and operational goals, communicated internally and externally, for managing the company's business and evaluating its performance. The company anticipates that it will continue to report both GAAP and certain non-GAAP financial measures in its financial results, including non-GAAP results that exclude stock-based compensation expense, restructuring and other related charges, amortization of purchased intangible assets, acquisition costs and other related charges, expense relating to the stock-based compensation review and restatement and income tax benefits or provisions resulting from changes in the valuation allowance. In addition, the company's results of operations may include a comparison of service revenues and operating expenses in constant currency terms, which excludes the effect of currency fluctuations between the U.S. dollar and the local functional currencies in countries where the company operates. The effect is excluded by translating the current period's local currency service revenues and operating expenses into U.S. dollars using the average local currency exchange rates that were in effect during the prior period of comparison. However, because the company's reported non-GAAP financial measures are not calculated according to GAAP, these measures may not necessarily be comparable to GAAP or similarly described non-GAAP measures reported by other companies within the company's industry. Consequently, Sapient's non-GAAP financial measures should not be evaluated in isolation or supplant comparable GAAP measures, but, rather, should be considered together with its consolidated financial statements, which are prepared according to GAAP.

Safe Harbor Statement

This press release contains forward-looking statements - in particular, the financial guidance for the second quarter - that involve a number of risks and uncertainties. Actual results could differ materially from management's expectations. A number of factors could cause actual events to differ materially from those indicated, including, without limitation: the continued acceptance of the company's services; a reduction in the demand for the company's services in light of the current economic environment; the company's ability to accurately set fees for and complete its current and future client projects on a timely basis, successfully manage risks associated with its international operations, manage its growth and projects effectively, successfully integrate and achieve anticipated benefits from acquisitions, and continue to attract and retain high-quality employees; and other risk factors set forth in the company's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, as filed with the SEC.

About Sapient

Sapient is a global services company that helps clients transform in the areas of business, marketing, and technology. The company operates three divisions that enable clients to gain a competitive advantage and succeed in an increasingly digital world. SapientNitro, Sapient Global Markets and Sapient Government Services fuse insight, creativity and technology to drive innovation and to help clients navigate complex business problems. Our approach is the subject of case studies used by MBA programs at Harvard and Yale. The company has operations in North America, Europe, and Asia-Pacific. For more information, visit www.sapient.com.


CONTACT DETAILS
Neha Pathak, Sapient, +91 (124) 4167000, npathak@sapient.com
Prachi Sinha, Gutenberg PR, +91 (11) 41324969, prachi@gutenbergpr.com

KEYWORDS
CONSUMER, ECONOMY, BUSINESS SERVICES, Financial Analyst, IT, STOCK EXCHANGES, TECHNOLOGY, SAPE.O

If you wish to change your Business Wire India selection please click on this link http://www.businesswireindia.com/media/news.asp and use your personal username and password to login.

Submit your press release at http://www.businesswireindia.com