-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PtWvBnKtEcfru/xIFOUjnkaxIJu7pt8cuoFSUAHTb/iBv2VNoU0zjz/lIbPavIbZ 7Jqzm3F0liQHtzfYf50UZw== 0000950124-04-000392.txt : 20040211 0000950124-04-000392.hdr.sgml : 20040211 20040211083338 ACCESSION NUMBER: 0000950124-04-000392 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040211 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040211 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SYNTEL INC CENTRAL INDEX KEY: 0001040426 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING SERVICES [7371] IRS NUMBER: 382312018 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-22903 FILM NUMBER: 04583827 BUSINESS ADDRESS: STREET 1: 2800 LIVERNOIS RD STREET 2: SUITE 400 CITY: TROY STATE: MI ZIP: 48043 BUSINESS PHONE: 2486192800 MAIL ADDRESS: STREET 1: 2800 LIVERNOID RD STREET 2: SUITE 400 CITY: TROY STATE: MI ZIP: 48043 8-K 1 k82827e8vk.txt CURRENT REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported) February 11, 2004 ------------------ Syntel, Inc. ------------------------------------------------------------------ (Exact Name of Registrant as Specified in Its Charter) Michigan ------------------------------------------------------------------ (State or Other Jurisdiction of Incorporation) 0-22903 38-2312018 ------------------------------------------------------------------ (Commission File Number) (IRS Employer Identification No.) 525 E. Big Beaver Road, Suite 300, Troy, Michigan 48083 ------------------------------------------------------------------ (Address of Principal Executive Offices) (Zip Code) (248) 619-2800 ------------------------------------------------------------------ (Registrant's Telephone Number, Including Area Code) ------------------------------------------------------------------ (Former Name or Former Address, if Changed Since Last Report) 1 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits. Exhibit Number ------- 99.1 Press Release dated February 11, 2004. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On February 11, 2004, Syntel, Inc. (the "Company") issued a press release announcing results of operations and related financial information for the fourth quarter and full year ended December 31, 2003. A copy of the press release is attached to this Report as Exhibit 99.1. The information contained in this Current Report, including Exhibit 99.1, is being furnished and shall not be deemed to be "filed" for the purposes of Section 18 of the Securities and Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except if the Company expressly states that such information is to be considered "filed" under the Exchange Act or incorporates it by specific reference in such filing. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Syntel, Inc. ------------------------------------------ (Registrant) Date February 11, 2004 By /s/ Keshav Murugesh -------------------- ---------------------------------------- Keshav Murugesh, Chief Financial Officer 3 EXHIBIT INDEX Exhibit No. Description 99.1 Press Release dated February 11, 2004. 4 EX-99.1 3 k82827exv99w1.txt PRESS RELEASE DATED FEBRUARY 11, 2004 EXHIBIT 99.1 ( BW)(MI-SYNTEL)(SYNT) Syntel Reports Fourth Quarter and Full-Year 2003 Results Business Editors/High-Tech Writers TROY, Mich.--(BUSINESS WIRE)--February 11, 2004--Syntel, Inc. (NASDAQ: SYNT): Highlights: -- Revenue for Q4 was $47.4M and FY2003 was $179.5M -- Gross margin for the Q4 and FY2003 was 43.6% and 43.3%, respectively -- EPS for Q4 and FY2003 was $0.27 and $0.99 per diluted share, respectively -- Global headcount grew by 1,067 to 3,861 in 2003 -- Year end 2003 cash balance & marketable securities of $136.8M Syntel, Inc. (NASDAQ: SYNT), a global information technology services firm, today announced financial results for the fourth quarter and full-year ended December 31, 2003. "We are very pleased with our performance for the fourth quarter and full-year, as we continued to show improvement across our key business metrics," said Bharat Desai, Syntel Chairman and CEO. Syntel's total revenue for the fourth quarter increased 20 percent to $47.4 million, compared to $39.4 million in the prior-year period and 7 percent sequentially from $44.1 million in the third quarter of 2003. The Company's gross margin was 43.6 percent in the fourth quarter of 2003, compared to 43.6 percent in the prior-year period and 41.6 percent in the third quarter of 2003. Syntel's income from operations was 27.5 percent in the fourth quarter, compared to 38.3 percent in the prior-year period and 29.5 percent in the third quarter of 2003. Matters of litigation related to the Metier transaction, an IT services company that Syntel acquired in 1999 were settled during the fourth quarter of 2002. Accordingly, $5.7 million of accrued Metier liabilities were reversed into income during that quarter, resulting in higher than usual income from operations. Net income for the fourth quarter was $10.9 million or $0.27 per diluted share compared to $11.2 million or $0.28 per diluted share in the prior year period, and $10.8 million or $0.26 per diluted share in the third quarter of 2003. For the full-year 2003, Syntel's revenue increased more than 11 percent to $179.5 million, compared to $161.5 million in 2002. Net income for 2003 was $40.3 million or $0.99 per diluted share, compared to $32.5 million or $0.81 per diluted share in 2002. The Company finished 2003 with gross margin of 43.3 percent compared to 41.8 percent in 2002. Year-over-year, Syntel's key focus area of applications outsourcing grew by 19.7 percent and now accounts for 76 percent of total revenue. During 2003, Syntel added 33 new corporate clients and launched 235 new engagements. Syntel signed 16 new "hunting licenses" or preferred partnership agreements with Global 2000 corporations and finished 2003 with 56 of these strategic relationships in place. Syntel's financial position and cash generation remain very strong. The Company ended 2003 with $136.8 million in cash and marketable securities. In the third quarter of 2003, Syntel paid a Page 1 special one-time dividend of $1.25 per share and initiated a $0.06 per share quarterly dividend. The Company remains debt-free. "Syntel reached several milestones in 2003," added Desai. "We reached the 3,861 employee mark, which was an addition of over 1,000 employees during the year. We also reached 2,664 billable consultants, with the addition of over 500. Syntel also recorded its highest quarter and best year overall with respect to revenue. For the first time, Syntel delivered a higher percentage of client work from India, which reflects customer demand and our strong push to more fully leverage our robust Global Development Center network. Syntel will continue to focus on delivering enhanced value to our key strategic clients in 2004 and look to further leverage our strength as a culturally-aligned IT partner to accelerate growth." Outlook "Syntel remains cautiously optimistic with respect to 2004," said Keshav Murugesh, Syntel's Chief Financial Officer. "We continue to work closely with our key clients to accelerate their outsourcing activity levels, but forecasting the timing of that acceleration continues to present a challenge. "Currently we expect 2004 revenue to be in the range of $198 million to $208 million and diluted earnings per share between $0.92 and $1.00. This guidance reflects our aggressive hiring plans as well as investments necessary to fuel our growth." Syntel to Host Conference Call Syntel will discuss its fourth quarter performance today on a conference call at 10:00 a.m. (Eastern). To listen to the call, please dial (888) 689-9220. The call will also be broadcast live via the Internet at Syntel's web site: www.syntelinc.com under the "Investor Relations" section. Please go to the web site at least 15 minutes prior to call start time to register and download any necessary audio software. A replay will be made available by calling (800) 642-1687 and entering "5025359" beginning at 1 p.m. (Eastern) on February 11, 2004 through midnight (Eastern) on February 16, 2004. About Syntel Syntel (SYNT) is a leading global provider of custom outsourcing solutions in a broad spectrum of information technology and information technology-enabled services. The Company's vertical practices support the entire Design-Build-Operate-Optimize lifecycle of systems and processes for corporations in the Financial Services, Insurance, Retail, Health Care and Automotive industries. The first US-based firm to launch a Global Delivery Service to drive speed-to-market and quality advantages for its customers, Syntel now leverages this efficient model for the majority of its Global 2000 customers. Recently named one of Forbes Magazine's "Best 200 Small Companies in America," Syntel has over 3,800 employees worldwide, is assessed at Level 5 of the SEI's CMM and is ISO 9001:2000 certified. To learn more, visit us at: www.syntelinc.com. - -0- *T Page 2 SYNTEL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (in thousands, except per share data)
3 MONTHS 12 MONTHS ENDED DEC 31 ENDED DEC 31 ------------------ ------------------- 2003 2002 2003 2002 --------- -------- --------- --------- Revenues (net) $47,409 $39,391 $179,507 $161,507 Cost of revenues 26,725 22,216 101,699 94,010 --------- -------- --------- --------- Gross profit 20,684 17,175 77,808 67,497 Selling, general and administrative expenses 7,627 7,776 27,396 31,421 Write Back related to Metier Settlement 0 5,698 0 5,698 --------- -------- --------- --------- Income from operations 13,057 15,097 50,412 41,774 Other income, principally interest 1,076 985 3,168 3,191 --------- -------- --------- --------- Income before income taxes 14,133 16,082 53,580 44,965 Income tax 3,190 4,790 13,242 12,338 --------- -------- --------- --------- Net income before loss from equity investment and investment write off 10,943 11,292 40,338 32,627 Profit / Loss from equity investment 0 141 34 141 --------- -------- --------- --------- Net income $10,943 $11,151 $40,304 $32,486 ========= ======== ========= ========= EARNINGS PER SHARE Basic $0.27 $0.29 $1.02 $0.84 Diluted $0.27 $0.28 $0.99 $0.81 Weighted average common shares outstanding: Basic 40,000 38,913 39,609 38,733 ========= ======== ========= ========= Diluted 41,081 40,304 40,797 39,917 ========= ======== ========= =========
*T - -0- *T Page 3 SYNTEL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEET (in thousands) December 31, December 31, 2003 2002 ------------ ------------ ASSETS Current assets: Cash and cash equivalents $110,699 $134,976 Investments, marketable securities 26,137 5,737 Accounts receivable, net of provision for doubtful accounts 32,429 24,329 Advanced billings and other current assets 5,931 9,674 ---------- ------------ Total current assets 175,196 174,716 Property and equipment 25,617 20,950 Less accumulated depreciation 18,502 15,801 ---------- ------------ Property and equipment, net 7,115 5,149 Goodwill 906 906 Deferred income taxes and other noncurrent assets 2,864 2,801 ---------- ------------ $186,081 $183,572 ========== ============ LIABILITIES Current liabilities: Accrued payroll and related costs $11,851 $11,885 Income taxes payable 6,507 2,530 Accounts payable and other current liabilities 9,861 9,027 Deferred revenue 4,456 5,286 ---------- ------------ Total liabilities 32,675 28,728 SHAREHOLDERS' EQUITY Total Shareholders' equity 153,406 154,844 ---------- ------------ Total liabilities and shareholders' equity $186,081 $183,572 ========== ============ Page 4 -----END PRIVACY-ENHANCED MESSAGE-----