ExlService Holdings, Inc. (Nasdaq: EXLS), a leading provider of Outsourcing and Transformation Services, announced its financial results for the quarter ended June 30, 2008.
The Company's financial highlights for the second quarter of 2008 include:
-- Revenues for the quarter increased 25.1% to $53.8 million from $43.0 million in the quarter ended June 30, 2007.
-- Gross margin for the quarter was 37.0% compared to 33.1% in the quarter ended June 30, 2007.
-- Operating margin for the quarter was 9.8% compared to 6.1% in the quarter ended June 30, 2007; adjusted operating margin for the quarter, excluding the impact of stock-based compensation expense and amortization of intangibles, was 13.7% compared to 10.0% in the quarter ended June 30, 2007.
-- Income from operations for the quarter was $5.3 million compared to $2.6 million for the quarter ended June 30, 2007; adjusted income from operations, excluding the impact of stock-based compensation expense and amortization of intangibles, for the quarter was $7.4 million compared to $4.3 million for the quarter ended June 30, 2007.
-- Net income to common stockholders for the quarter was $5.3 million compared to $5.6 million in the quarter ended June 30, 2007.
-- Diluted GAAP earnings per share to common stockholders was $0.18 for the quarter compared to $0.19 in the quarter ended June 30, 2007; adjusted earnings per share on a diluted basis, excluding the impact of stock-based compensation expense and amortization of intangibles, was $0.23 for the quarter compared to $0.24 in the quarter ended June 30, 2007.
Reconciliations of adjusted financial measures to GAAP are included at the end of this release. Effective April 1, 2008 the Company has revised its three previous reporting segments into two segments, Outsourcing Services and Transformation Services, to match the way our business now operates and markets its products.
Rohit Kapoor, President and CEO of EXL, commented: "As the economic environment in the US, UK and Europe continues to become more challenging, our clients are actively seeking strategic cost management solutions. We are pleased that EXL's vision of delivering both Outsourcing and Transformation services is playing well to this market trend. Our performance this quarter was led by rapid growth in our Transformation business across a well diversified base of client relationships. From an operational perspective, this quarter we are proud to have achieved record low attrition levels and at the same time we have improved our margins. With the resolution of Aviva's strategic review process and the extension of our contract with two of our largest customers, EXL is now fully focused on adding new client relationships and growing our business. We have an extremely strong balance sheet and are well positioned to execute strategic acquisitions and continue to make growth- oriented investments."
Matt Appel, CFO of EXL, commented: "EXL's second quarter financial results reflect strong profitability performance. Our adjusted operating margins for the second quarter of 2008 expanded to 13.7% from 10.0% a year earlier despite the annual wage increases granted during the quarter as well as the headwind related to the opening of our Philippines facility in April 2008. We are particularly pleased with the growth in our adjusted operating margin which reflects the operating performance of our business."
"As a result of one time charges related to the transfer of the Aviva Pune BOT, the volatile foreign exchange environment and lower volumes expected at select clients in the second half of 2008 we are adjusting our guidance for 2008. We continue to believe that the fundamentals of our business model, including our long term growth rate and adjusted operating margins, are intact." -- ExlService Holdings, Inc.
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