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POSTED AT 09:49 AM 13-02-2018

Virtusa Corp targets US$1 bn revenue for 2018

by Shirajiv Sirimane

Image Courtesy : Daily News

Virtusa Corp. is looking at fiscal year 2018 revenue to be in the range of US$1,013.3 to US$ 1,019.3 million, said Virtusa’s Chairman and CEO, Kris Canekeratne.

“Virtusa’s competitive advantage lies in our deeply grounded and unique ability to deliver large scale digital transformation combined with legacy IT platform rationalization, cost reduction and effort compression. As digital engineers, we understand how to bridge the tasks and deliver end-to-end digital programs that yield tangible results for our clients. Our strong third quarter and year-to-date results are proof that our strategy is working and our advantage is real. In consequence, we believe we are well positioned to continue to generate the above-industry growth.”

The Company ended the third quarter of fiscal 2018 with $303.9 million of cash, cash equivalents and short-term and long-term investments inclusive of $25 million drawn down from the existing revolving credit facility to fund the Polaris delisting offer. The cash flow from operations was $24.3 million for the third quarter of fiscal 2018.

In support of the transaction, on February 6, 2018, Virtusa entered into a $450 million credit agreement with a syndicated bank group jointly lead by JP Morgan Chase Bank, N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, which replaces Virtusa’s existing $300 million credit agreement.

He said that successful Polaris delisting process too was a success story for the company. He said the move brought them additional clients and Polaris too showed profit from a flat year.

He also said today the high focus on digitalization, Cloud, Robotics, especially in the banking and other ICT related sectors too is giving them new areas of business.

Commenting on the US economic policy changes which were done under the Trump Administration, he said that it is bearing fruit. “The lowering of taxes from around 30% to 21% is a very good move which has resulted in US companies reinvesting aggressively.”

In accordance with US GAAP, Virtusa will be applying the if-converted method to its convertible preferred shares when reporting its fiscal year 2018 results. The if-converted method is used to calculate the share impact of convertible securities.