Intelligroup-press releases: media mentions

Intelligroup reported a rise in Q2 '08 revenues of 11.4% to $40.1 million, compared to $36.0 million in Q2 2007 and a rise of 4.4% as compared to revenues of $38.5 million in Q1 '08 primarily due to the addition of new customer projects in the mid-tier market. The Company's average onsite bill rates increased by 4% in Q2 '08 as compared to Q2 '07 and remained relatively flat as compared to Q1 '08. The Company's average offshore rates increased by 10% in Q2 '08 as compared to Q2 '07 and remained relatively flat as compared to Q1 '08. Q2 '08 gross profit rose to $13.0 million - gross margin of 32.5% - compared to Q2 '07 gross profit of $10.4 million - gross margin of 28.9% - and Q1 '08 gross profit of $11.4 million - gross margin of 29.7%. The increase in gross profit was principally due to improved resource utilization both onshore and offshore.

Selling, general and administrative expenses were $10.4 million, or 25.9% of revenues, compared with $9.4 million, or 26.1% of revenues, in the second quarter last year and $9.7 million or 25.3% of revenues in Q1 '08. The increase in SG&A was due primarily to investments the Company has made during the past few quarters to support its growth. Q2 '08 operating income rose 167%, to $2.6 million, or 6.5% of revenues, compared with $1.0 million, or 2.7% of revenues, in Q2 '07. Operating income increased by 54% from $1.7 million or 4.4% of revenues in Q1 '08.

Offsetting its operating income gains, Intelligroup recorded a net foreign exchange loss of $1.4 million in Q2 '08 reflecting an impact from the Company's hedging strategy due to the unexpected decline of the value of the Rupee versus the U.S. dollar in Q2 '08. While hedging is an important long-term risk management practice and an integral component of onshore/offshore businesses, increasing fluctuations in foreign exchange markets can still result in volatility in quarterly operating results.

Despite the foreign exchange loss, Q2 '08 net income increased to $1.1 million, or $0.03 per diluted share, compared with Q2 '07 net income of $0.8 million, or $0.02 per diluted share. Net income decreased from $1.9 million in Q1 '08, or $0.04 per diluted share, primarily reflecting the Company's net foreign exchange loss of $1.4 million. The weighted average diluted shares outstanding was 42.2 million and 42.0 million in Q2 '08 and Q2 '07, respectively, and 42.5 million in Q1 '08.

Intelligroup President and Chief Executive Officer, Vikram Gulati, commented, "Intelligroup had another strong operating performance in the 2008 second quarter marked by new business wins, continued revenue growth and on-going margin improvement resulting from our efforts to improve resource utilization and our overall cost structure. Our year-to-date performance reinforces our confidence in our ability to perform well in the competitive global IT services landscape and is a reflection of the hard work of our 2,400 employees.

"Intelligroup is a significantly improved company today following a three-year period of internal focus during which we brought in new management, assembled a new sales team, restructured many areas of our business and operational strategy, and strengthened our overall financial position. With our industry leading expertise and experience in ERP consulting, global service delivery platform, growing portfolio of proprietary tools that create real value for clients, and continued focus on the highest standards of customer service, we believe we are well positioned to continue our growth trajectory."

About Intelligroup, Inc.
Intelligroup is an ERP-focused enterprise applications systems integrator providing consulting, implementation, testing, application management and other IT services for global corporations. The Company possesses deep expertise and proprietary tools in industry-specific enterprise solutions and has been recognized by clients, partners including SAP and Oracle and IT industry analysts for consistently exceeding expectations. Intelligroup won the 2007 global annual Pinnacle Award from SAP, was the finalist in Oracle 2007 Titan Awards, and was recognized by NASSCOM as a Top 100 Innovator. Intelligroup's global service delivery model combines onsite teams and offshore development capabilities to deliver solutions that accelerate results, reduce costs and generate meaningful ROI for clients. Intelligroup clients include Varian Medical, Reckitt Benckiser, Royal Greenland, SAP, Magellan, Hershey's, Eastman Chemical and Hitachi. For more information please visit www.intelligroup.com.

Safe Harbor for Forwarding-looking Statements:
Certain statements contained herein, including statements regarding the development of services and markets and future demand for services and other statements regarding matters that are not historical facts, are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements include risks and uncertainties; consequently, actual results may differ materially from those expressed or implied thereby. Factors that could cause actual results to differ materially include, but are not limited to, variability of quarterly operating results, continued uncertainty of the IT market and revenues derived from application management business, uncertainty in revenues for traditional professional services offerings, loss of one or more significant customers, reliance on large projects, concentration of revenue, volatility caused by fluctuations in the currency markets, unanticipated costs associated with continued litigation, ability to attract and retain professional staff, dependence on key personnel, ability to manage growth effectively, risks associated with strategic partnerships, various project-associated risks, including termination with short notice, substantial competition, general economic conditions, risks associated with intellectual property rights, risks associated with international operations and other risk factors detailed under the caption "Risk Factors" in Intelligroup's annual report on Form 10-K for the period ended December 31, 2007. Intelligroup disclaims any intention or obligation to update forward looking statements as a result of developments occurring after the date of this press release.

Intelligroup, the Intelligroup logo and 'Creating the Intelligent Enterprise', are trade-marks of the Company. 4Sight, 4Sight Plus, PowerUp Services, HotPac Analyzer and Uptimizer are service marks of Intelligroup.

All other trademarks and company names mentioned are the property of their respective owners.

Investor Contacts
Jaffoni & Collins Incorporated
212-835-8500
Itig@jcir.com

Laurel Tasso
Intelligroup, Inc.
(732) 362-2291
laurel.tasso@intelligroup.com