Virtusa (VRTU) Tops Q3 EPS by 2c, Revenues Beat; Offers Q4 & FY19 EPS/Revenue Guidance

Virtusa (NASDAQ: VRTU) reported Q3 EPS of $0.61, $0.02 better than the analyst estimate of $0.59. Revenue for the quarter came in at $314.7 million versus the consensus estimate of $314.36 million.

• Third quarter fiscal 2019 revenue of $314.7 million increased 3.0% sequentially and 19.3% year-over-year.
• Third quarter fiscal 2019 GAAP diluted EPS of $0.37. Non-GAAP diluted EPS of $0.61.
• Third quarter fiscal 2019 GAAP operating income of $19.3 million increased 41% year-over-year. Non-GAAP operating income of $32.7 million increased 26% year-over-year.
• Third quarter fiscal 2019 operating cash flow of $36.5 million, representing 11.6% of revenue.

Kris Canekeratne, Virtusa’s Chairman and CEO, stated, “Our unique ability to enable deep digital transformation at some of the world’s largest enterprises continues to elevate our position as the digital engineering partner of choice. In addition, our investments in developing the best talent and expanding our digital solutions and capabilities are enabling us to remain a step ahead of emerging technologies and increase the value we deliver to our clients. Our consistently solid financial results through the first three quarters of fiscal 2019 are a testament to our strategy and competitive advantage.”

Ranjan Kalia, Chief Financial Officer, said, “We delivered another quarter of strong financial results. Fiscal third quarter revenue and non-GAAP EPS were toward the high-end of our guidance and increased 19% and 30% year-over-year, respectively. Our strong earnings growth reflects continued progress against our margin expansion targets, with our non-GAAP operating margin reaching the double-digits in the fiscal third quarter. Our continued business momentum has allowed us to offset significant FX headwinds throughout the year and has enabled us to again reaffirm the midpoint of our fiscal 2019 revenue guidance while raising the midpoint of our EPS guidance.”

GUIDANCE:

Virtusa sees Q4 2019 EPS of $0.59-$0.65, versus the consensus of $0.64. Virtusa sees Q4 2019 revenue of $326-334 million, versus the consensus of $332.36 million.

Virtusa sees FY2019 EPS of $2.25-$2.31, versus the consensus of $2.26. Virtusa sees FY2019 revenue of $1.246-1.254 million, versus the consensus of $1.25 million.

For earnings history and earnings-related data on Virtusa (VRTU) click here.

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