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Thursday, Oct 31, 2002

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Albion Orion goodwill drags SSI bottomline

Our Bureau

CHENNAI, Oct. 30

THE net profit of SSI Ltd has reduced by more than half to Rs 1.13 crore on total revenues of Rs 59.5 crore for the first quarter ended September 30, 2002.

This is compared to a net profit of Rs 2.78 crore on total revenues of Rs 82.87 crore during the same period last year. The net profit in the previous quarter ended June 30, 2002 was Rs 1.18 crore on revenues of Rs 58.3 crore.

On a consolidated basis, including subsidiaries, the company reported an increased net loss of Rs 10.47 crore on total revenues of Rs 91.37 crore for the September quarter compared to a net loss of Rs 8.35 crore on revenues of Rs 113.73 crore for the same period last year.

The Chairman and CEO, Mr Kalpathi S. Suresh, told reporters here that the Rs 10-crore goodwill every quarter (from the acquisition of the US-based Albion Orion Inc) was affecting bottomline. The company had amortised goodwill of about Rs 50 crore in the last six quarters, and Rs 160 crore was still left, he said. "We are still debating internally whether to amortise the entire goodwill at one go," he added.

During the September quarter of 2002, revenues from education and training dropped by more than half to Rs 21.13 crore (Rs 48.5 crore). On the other hand, revenues from software services increased marginally to Rs 38.4 crore (Rs 34.3 crore). On billing rates, Mr Suresh said, while the rates are constantly under pressure, overall, the numbers remain the same compared to last quarter.

The company's onsite billing rates in business consulting was about $250 per person per hour. In partnership with the PricewaterhouseCoopers, SSI (through its Chicago office) was doing a consulting project (in enterprise application integration) for the US-based Baxter at a rate of $250, he added.

On its own, SSI was doing a Manugistics (supply chain) project at $190 (net rate) for a US client, he added. The current order book was at $43.5 million and in the last quarter the company got an order of $8 million, he said.

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