N. N. Sachitanand
BANGALORE, MARCH 10
do not make a right. But, in the world of software business, two
minuses can make a plus if the financial performance in the past
year of MphasiS-BFL Ltd. is any indication.The company was formed
a year ago by the merger of two firms - the Santa Monica, California
based MphasiS Corporation specialising in web-integration architecture
and the Bangalore-based BFL Software Ltd., which provided Unix based
were brought together by Barings, which held 52 per cent of BFL's
equity and was also a shareholder in MphasiS. The new entity provides
end to end e-business solutions. The verticals that MphasiS-BFL
seeks to focus on are:
industry (banking, brokerage and insurance); the retail industry;
media and telecommunications; technology companies; and logistics
and supply chain management.
time of the merger, both the entities were in the red. Post merger,
for the nine months ended December 31, 2000 consolidated revenues
were $46.23 million and earnings before interest, tax, depreciation
and amortisation of goodwill and ESOP expenses (EBITDA) $3.5 million.
to this correspondent after a board meeting in Bangalore on March
7, the Chairman, Mr. Jerry (Jaithirth) Rao,claimed, ``The results
reflect the synergy between the two companies. We have been able
to leverage the combined strengths, without diluting the expertise
that the individual companies bring, and still be in a position
to address scalability and speed - two critical areas for success
in this segment. The top line and profits growth in the current
quarter are in line with what has happened in the previous quarter.''
about the impact of the U.S. slowdown on the company's fortunes,
Mr. Rao maintained that so far the company had neither experienced
any cutback in demand for its services nor any pressure to revise
its billing rates. He felt that the degree of downslide in the U.S.
demand for IT services had been exaggerated and the second half
of this year should see a revival of IT services demand from the
U.S. Mr. Rao also pointed out that the clientile of MphasiS were
not the fast fading all-virtual dotcoms but brick and mortar companies
that were extending their businesses across the Internet. This business
is stable and huge.
One of the initiatives is to more aggressively
pursue the Europe and Japanese markets. At present, 70 per cent
of the company's revenues come from the U.S., 20 per cent from Europe
and the balance from Asia-Pacific. The second initiative is to strengthen
and expand the India-based subsidiary, MphasiS BPO, which is into
the IT-enabled services such as call centres and help desk. Third,
the company will also be taking up consultancy in special areas
such as testing of software processes employed by clients.