Sify reports revenues of $ 34.54 million for the first Quarter of fiscal year 09-10

Grows revenues 10% over previous year, Net Loss for the Quarter reduced to $ 1.34 million

Chennai, Wednesday, 29thJuly 2009: Sify Technologies Limited (Nasdaq National Markets: SIFY), a leader in Enterprise and Consumer Internet Services in India with global delivery capabilities, announced today its consolidated unaudited results under International Financial Reporting Standards (IFRS) for the first Quarter of the fiscal year 2009-10

Performance Highlights:

 Sify reported revenues of $ 34.54 million for the Quarter ended 30th June 2009, 10 % higher than the same Quarter in the previous year, and 8.7% higher than the immediately preceding Quarter

 The Enterprise services registered robust growth with the investments made in infrastructure reach and capacities to make these services more competitive. Sify’s international services revenues were lower with the focus on growing revenues going forwards with a healthy funnel for Infrastructure Managed Services and new accounts in eLearning. The consumer services revenues were lower than previous quarters with the focus on making the businesses profitable.

 Net Loss for the Quarter was reduced to $ 1.34 million as against a Net Loss of $ 2.77 million in the same Quarter in the previous year, and Net Loss of $ 5.36 million in the immediately preceding Quarter. Net loss for the quarter includes one-time beneficial tax adjustment of $ 1.88 million on account of the merger of Sify Communications with Sify Technologies Limited.

 Capex during the Quarter was $ 2.62 million on account of data centre expansion and network infrastructure during the Quarter.

 Sify ended the quarter with a cash balance of $ 4.71 million.

Mr. Raju Vegesna, Board Chairman and CEO & MD, Sify Technologies, said, “We have done well to grow our revenues overall with our Enterprise services leading the way. Our data center services and managed voice services continue to experience robust demand, as do our other services spanning connectivity, applications and systems integration. On the consumer front, we are seeing signs of improvement in the online advertising market, and this should reflect in our performance going forwards. Our initiatives to consolidate and rationalize access services through cyber cafes are bearing fruit. However, consumer broadband services remain a challenge being addressed with a focused approach to growing revenues and users. Overall we expect to continue growth and reduction in losses moving towards profitability going forwards.”

Mr CVS Suri, Chief Operating Officer, Sify, said, “We saw significant growth and acceleration in our Enterprise service revenues in the first Quarter which sets us up for continued revenue growth in the coming quarters. While growth was across all five Enterprise businesses, we expect hosting, managed voice services and connectivity to contribute significantly going forwards. Our newly launched systems integration services, which includes the earlier security services, also has some significant new initiatives on hand which should contribute to growth in future. On the consumer front, we are likely to see growth in our portals revenues with new initiatives for online ad revenues such as video ads seeing success. While cyber café revenues have been stabilized, significant growth will only be possible with the launch of new initiatives under development currently, and planned for the second quarter. A multi-pronged approach to broadband services should see us growing users and revenues in the quarters going forward.”

Mr. MP Vijay Kumar, Chief Financial Officer, Sify, said, “While we have done well to continue to grow revenues and reduce losses, our focus on increasing efficiencies across the organization continue and is reflected in a reduction in our SG&A costs in the last Quarter. We expect to see greater benefits from the initiatives taken to reduce costs over the past few quarters in the coming months. We are also focusing on greater efficiencies in infrastructure utilization and are starting to see the benefits of this. The merger of Sify Communications with Sify Technologies will result in efficiencies in operations, synergy in infrastructure utilization and higher levels of resource productivity. This will help us to accelerate our path to profitability.”