NIIT Ltd.: Bleak hiring continues to hurt business - Views on News from Equitymaster

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  • Jul 27, 2012 - NIIT Ltd.: Bleak hiring continues to hurt business

NIIT Ltd.: Bleak hiring continues to hurt business

Jul 27, 2012

NIIT Limited has announced the first quarter results of financial year 2012-2013 (1QFY13). The company has reported a 29.2% YoY decline in sales and a 12.7% YoY decline in net profits. However, it should be noted that the results are not exactly comparable to the same period last year as 1QFY13 does not have the numbers from Element K which the company had divested in October 2011. On a continuing business basis, NIIT Ltd has reported a 3.9% YoY growth in sales and a whopping 109.9% YoY growth in net profits. Here is our analysis of the results. Please note that in our analysis we would be referring the numbers of continuous business for like-to-like comparison. However, in the table, we have included the analysis on overall basis as well for your reference.

Performance summary
  • Consolidated net sales grew by 3.9% year-on-year (YoY) during 1QFY13. The growth was largely driven by a good performance in its Corporate Learning Solutions business.
  • Operating margins declined by 2.6% YoY during the quarter, largely due to higher operating costs (as percentage of net sales) as well as pre-operative expenses related to the new business segment 'skill building solutions'.
  • Despite a decline in margins at operating levels, higher depreciation charges as well as higher other losses, net profits grew by a whopping 109.9% YoY during the quarter. This came on account of tax write-back as well as higher share of associates' net profit.
  • The total headcount reduced by 120 to 3,607 during the quarter.

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Jun 25, 2021 12:15 PM