GEPL News Update on Mahindra Satyam 01st October10 (video)

Post the declaration of fudging of accounts done by the earlier chairman of Mahindra Satyam Mr. Ramalinga Raju, the current board announced the audited annual results for FY09 & FY10. The company has identified recording of fictitious entries in the income statement done by the previous management inorder to inflate its topline. Fictitious revenue receipts, interest income and forex gains along with excess salary costs and advance tax payments have been debited to the income statement impacting the p/l a/c. Post reconciliation, the audited results reflect Revenues of about INR88.1 bn for FY09. However, Mahindra Satyam has recognized certain exceptional items of about INR79.9 bn, which have resulted in a loss after tax of INR81.7 bn for FY09.  Post the acquisition, Mahindra Satyam has managed to improve its financial position by clearing most of its loans on the books, which stood at INR1.4 bn as on September 2008 and stands at INR422 mn as on March 31, 2010. An improving business environment and enhanced capabilities has helped the company acquire new clients resulting in revenues of INR54.8 bn for FY10. Furthermore, with the headcount plummeting to 27,000 in FY10 salary costs declined significantly resulting in a positive EBITDA margin of 8.3%. Going forward, the company plans to continue investing in its capabilities to exhibit a similar performance.


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