Polaris posts Q1 revenues of Rs 257.45 cr & profits of Rs. 14.42 cr

Polaris posts Q1 revenues of Rs 257.45 cr & profits of Rs. 14.42 cr

…6 Intellect wins in a single quarter

Chennai, 18 July 2007: Polaris Software Lab Limited (POLS.BO), a NASSCOM Top 10 company and the leader in specialty application development in banking, financial & insurance sector, today announced the first quarter results for FY 2007-08. For the quarter ended 30th June 2007, consolidated revenue was Rs 257.45 crore, operating profit (EBITDA) was Rs 30.51 crore and Profit after Tax (PAT) was Rs 14.42 crore.

Compared to the same quarter last year (Q1 ’06-’07), revenues grew by 10.95% from Rs 232.05 crore to Rs. 257.45 crore. Compared to the previous quarter (Q4 ’06-’07), the revenues grew by 3.65 % in dollar terms from $ 60.51 Million to $ 62.72 Million. The sharp appreciation in rupee against US dollar created a negative impact of Rs. 20.95 crore in revenue and Rs. 10.62 crore in operating margins. Consequently Q1 revenues stood at Rs 257.45 as against Rs 270.77 crore in the previous quarter, the operating profit stood at Rs. 30.51 crore against Rs. 35.56 crore, and Profit after Tax (PAT) stood at Rs 14.42 crore as against Rs. 21.40 crore in Q4.

Polaris has won 6 Intellect platform deals during the quarter. The wins came from Western Europe, Middle East and Asia Pacific (2 in Western Europe, 2 in Middle East, 1 in South East Asia and 1 in Australia). Intellect Credit Cards, Intellect Lending, Intellect Wealth, Intellect Portal and Intellect Liquidity platform were chosen by the customers in the above mentioned regions this quarter.

With the wins in this quarter, the company has a strategic customer landscape of 16 AAA, 17AA, and 30 A accounts.

Business highlights for the quarter ended 30 June 2007

• Master Services Agreement (MSA) for specialized outsourcing services signed with 2 global Top 10 banks.

• Launched the super specialty center for the Risk & Treasury business in Mumbai, to provide highly specialized products as well as end to end solutions for modernization of global treasuries

• 14 new clients were added, out of which 6 were Intellect led wins spread across Europe (2), Middle East (2), Asia (1) and Australia(1)

• Entered into a strategic partnership with Ementor Denmark A/S to deliver IT solutions tailor made for the Nordic market

• Launched Near Shore Application Center & a Global Performance Engineering & Certification Lab in Mississauga, Ontario, Canada

Financial highlights for quarter ended 30 June 2007

• In dollar terms, the revenue grew by 23.44% over the corresponding quarter last year, from $ 50.81 Million to $ 62.72 Million

• In dollar terms, the revenue grew by 3.65% over the previous quarter, Q4 ’06-’07, from $ 60.51 Million to $ 62.72 Million

• In rupee terms, the revenue grew by 10.95 % over the corresponding quarter last year, from Rs. 232.05 crore to Rs 257.45 crore

• Revenue contribution from Americas was 34.78 %, Europe 31.82 %, Asia Pacific & Japan 21.97 %, and India 11.43 %

• Intellect-led business contributed 20.90 % to overall revenue

• Citigroup contributed to 39.60 % of the quarterly revenue

• Optimus, the BPO subsidiary, contributed to 3.90 % of overall revenues

Mr. Arun Jain, CEO & Chairman, Polaris Software Lab Ltd., said, “During the last 6 quarters we have been able to implement Intellect Product in Tier 1 banks. Now, we are beginning the second phase of growth by taking Intellect to Tier 2 & Tier 3 banks along with our IP-led Services strategy.”

Arup Gupta, President & COO, Polaris Software Lab Ltd., said, “During the quarter we have won 5 key outsourcing deals & 6 Intellect deals. While these wins may not have led to direct revenues in this quarter, they will be reflecting in the coming quarters. I am delighted that our increased investments in sales & marketing are giving results.” Mr. R Srikanth, Chief Financial Officer, Polaris Software Lab Ltd., “ Q1 has certainly seen an adverse impact of appreciating rupee and we have an impact of 412 basis points in operating margins. We intend to continue our short term hedging strategy & keep tight control on cost & productivity.”

About Polaris Software Lab

Polaris Software Lab (POLS.BO), a NASSCOM Top 10 company, is a recognized global leader in Specialty Application Development for the Banking, Financial and Insurance sector, with its comprehensive portfolio of products, specialized outsourcing & modernization services and consulting. Polaris has a talent strength of close to 9000 solution architects, domain experts and technology experts and owns the largest set of Intellectual Properties in the form of a comprehensive product suite and seven banking platforms namely Intellect Cash Management, Intellect Consumer Finance, Intellect Wealth Management, Intellect Universal Banking, Intellect Credit Cards, Intellect Risk & Treasury Platform and Intellect Front Office. Headquartered in Chennai, Polaris has its Corporate Banking Solution Centre in Mumbai, Investment Banking Solution Centre in Hyderabad, Risk & Treasury Solution Center in Mumbai, Retail Banking Solution Centre in Chennai and Enterprise Solution Centre in Delhi. Polaris has offices in Tokyo, Sydney, Hong Kong, Singapore, India, Dubai, Bahrain, Riyadh, London, Belfast, Zurich, Frankfurt, Toronto, New York, Chicago, Fremont and Chile. For more information, please visit http://www.polaris.co.in/.