Virtusa’s 1Q fiscal year 2010 revenue drops 12 percent to $37.4 million

Virtusa Corporation (NASDAQ: VRTU), a global information technology (IT) services company that provides IT consulting, technology implementation and application outsourcing services through an enhanced global delivery model, reported financial results for the first quarter fiscal year 2010, ended June 30, 2009.

Revenue for the first quarter of fiscal 2010 was $37.4 million, a decrease of 12 percent year-over-year and 10 percent sequentially. On a constant currency basis, the first quarter revenue decreased seven percent year-over-year and 12 percent sequentially.

Virtusa reported income from operations of $3.1 million for the first quarter of fiscal 2010, compared to $11,000 for the first quarter of fiscal 2009 and $3.9 million for the fourth quarter of fiscal 2009.

Net income for the first quarter of fiscal 2010 was $2.6 million, or $0.11 per diluted share, compared to $0.8 million, or $0.03 per diluted share for the first quarter of fiscal 2009 and $3.6 million, or $0.15 per diluted share, for the fourth quarter of fiscal 2009.

The Company ended the first quarter of fiscal 2010 with $116.7 million of cash, cash equivalents, short-term investments and long-term investments. The Company generated cash from operations of $4.1 million during the first quarter of fiscal 2010.

Virtusa’s Chairman and CEO Kris Canekeratne said, “Even in a challenging business environment, we started work with six new clients during the June quarter, continued to execute well against newer client expansion programs, and efficiently managed operations.”

“We believe our ability to drive successful business outcomes for our clients through our value proposition and outstanding track-record of service excellence, combined with our focus on operational efficiencies, positions Virtusa well for sustainable long-term profitable growth, he said.”

Chief Financial Officer Ranjan Kalia said, “Consistent with our fiscal year 2010 goals, our first quarter performance demonstrates our ability to manage profitability and continue to generate positive cash flow from operations. We also further strengthened our balance sheet, ending the quarter with cash and investments of $116.7 million.” “We continue to believe sequential growth will resume in the second half of fiscal year 2010 and remain focused on optimizing our cost structure while making select investments in support of growth opportunities,” he said.