Sify reports Consolidated Financial Results for Q2 FY 2024-25

Revenues of INR 10275 Million. EBITDA of INR 1963 Million.

Profit for the period INR 49 Million.

CHENNAI, India, Oct. 22, 2024 (GLOBE NEWSWIRE) --

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On the call: Mr. Raju Vegesna, Chairman of the Board, Mr. M P Vijay Kumar, Executive Director & Group CFO and Mr. Kamal Nath, Chief Executive Officer

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___________________________

HIGHLIGHTS

   -- Revenue was INR 10275 Million, an increase of 17% over the same quarter 
      last year. 
 
   -- EBITDA was INR 1963 Million, an increase of 29% over the same quarter 
      last year. 
 
   -- Profit before tax was INR 87 Million. Profit after tax was INR 49 
      Million. 
 
   -- CAPEX during the quarter was INR 2594 Million. 

MANAGEMENT COMMENTARY

Mr. Raju Vegesna, Chairman, said, "The enterprise landscape in India is undergoing a transformative evolution, driven by a confluence of regulatory advancements, innovative business models, and robust infrastructure development. As we navigate this dynamic environment, it is clear that India is emerging as a global hub for Information and Communication Technology (ICT).

Regulatory frameworks are becoming increasingly conducive to business growth, allowing for an ecosystem that encourages innovation and investment. Initiatives such as Digital India and the Make in India campaign have streamlined processes and incentivized entrepreneurship.

This shift is not just about adopting new tools; it's about reimagining how we conduct business and deliver value to our stakeholders."

Mr. Kamal Nath, CEO, said, "As enterprises embark on their digital transformation journeys, they are reshaping their IT frameworks to integrate a diverse array of innovative solutions. The overarching goal remains the same: to enhance user satisfaction, ensure operational resilience, and safeguard digital assets.

To support these ambitions, we are making significant capital investments and expanding our range of offerings. Our strategic focus on delivering innovative outcomes through our comprehensive suite of infrastructure and managed services uniquely positions us to partner with businesses during this pivotal transformation."

Mr. M P Vijay Kumar, ED & Group CFO, said, "We draw your attention to Sify adopting the new standard of International Accounting Standards Board's recent issuance of IFRS 18 (Presentation and Disclosure in Financial Statements) starting with the last quarter ending June 30, 2024. By adopting the new framework, we seek to maintain clarity and consistency in our financial communications. Importantly, while our presentation may change, there is no alteration in total income or net profit.

We also remain committed to cost-effectiveness and fiscal prudence. Our ongoing investments reflect a forward-thinking perspective that anticipates market trends. These efforts will positively impact our net profit in the near future. However, it is essential to acknowledge that these investments also lead to increased depreciation and interest costs, which we account for transparently in our financial statements.

We are also actively scaling our sustainable practices across all our businesses, with particular emphasis on our Data Centers. This commitment to sustainability is not just a compliance measure; it is integral to our long-term strategy and resonates with the broader digital transformation initiatives being pursued by industries across India.

The cash balance at the end of the quarter was INR 7574 Million."

BUSINESS HIGHLIGHTS

   -- The Revenue split between the businesses for the quarter was Data Center 
      colocation services 32%, Digital services 32% and Network services 36%. 
 
   -- During the quarter, Sify commissioned 6.5 MW of Data Center capacity in 
      Mumbai. 
 
   -- As of September 30, 2024, Sify provides services via 1069 fiber nodes 
      across the country, a 12% increase over same quarter last year. 
 
   -- Sify has now deployed 10057 SDWAN service points across the country. 

CUSTOMER ENGAGEMENTS

Among the most prominent new contracts during the quarter were the following:

Data Center Services

   -- A global security firm and a nationalized bank migrated from the 
      competition's Data Center to Sify Data Center. 
 
   -- The national postal network signed up to expand their DR at Sify's 
      premises. 
 
   -- One of the largest private banks signed up for modernization of the DC to 
      DR network path. 
 
   -- The country's premier financial transaction settlement assurance platform 
      and a nationalized bank signed up to expand their DR at one of Sify's 
      locations. 
 
   -- Sify extended its leadership in AI technology by becoming the first Data 
      Center provider in India to achieve NVIDIA DGX-Ready Data Center 
      Certification for Liquid Cooling at its Rabale campus. 

Digital services

   -- A private mobility player, a co-operative bank, an EPC major, an 
      automation company and an ITeS company signed up to migrate their 
      on-premise DC to our Cloud platform. 
 
   -- One of the largest housing finance players, a paints major and a couple 
      of steel manufacturers contracted Sify to build greenfield cloud 
      platforms. 
 
   -- Multiple players across housing finance, logistics, health, securities 
      and asset management signed up for services like DRaaS, PaaS and IaaS. 
 
   -- A state government's technology mission signed up for on-prem 
      commissioning of private cloud. 
 
   -- A state government's biotechnology promotion platform, a private 
      healthcare and power transmission player signed up for on-prem Security 
      build services. 
 
   -- Multiple national players across real estate infrastructure, retail, 
      logistics and healthcare signed up for SAP services. 
 
   -- A state government training platform and another distribution platform 
      signed up for online assessments. 

Network Services

   -- One of India's largest private banks and a retail MNC signed up for 
      Sify's Global Cloud interconnection. 
 
   -- An India-centric Internet exchange contracted for establishing 
      connectivity in Tier 2 cities. 
 
   -- One of India's largest exchanges signed up for WAN across their backbone 
      network. 
 
   -- A pharmaceutical MNC in India contracted for Low Latency Internet 
      services. 
 
   -- One of the largest financial transaction services players contracted for 
      Low Latency Data Center Inter-Connect services. 

FINANCIAL HIGHLIGHTS

 
Unaudited Consolidated 
Income Statement as 
per IFRS 
(In INR millions) 
     Description        Quarter ended    Quarter ended    Quarter ended 
---------------------- 
                        September 2024   September 2023     June 2024 
---------------------- 
 
 
  Revenue                       10,275            8,791           9,421 
  Cost of Sales                 (6,362)          (5,509)         (5,961) 
  Gross Profit                   3,913            3,282           3,460 
  Other Operating 
   Income                          135              173              88 
  Selling, General and 
   Administrative 
   Expenses                     (1,945)          (1,762)         (1,676) 
  Depreciation and 
   Amortisation 
   expense                      (1,323)          (1,213)         (1,306) 
  Operating Profit                 780              480             566 
  Investment Income                  2               20              58 
  Profit before 
   financing and 
   income taxes                    782              500             624 
  Interest expenses on 
   borrowings and 
   lease liabilities              (694)            (502)           (670) 
  Interest expenses on 
   pension 
   liabilities                      (1)               -               - 
  Profit/(Loss) before 
   income taxes                     87               (2)            (46) 
                        --------------   --------------   ------------- 
 
  Income Tax Expense               (38)             (38)            (59) 
 
  Profit/(Loss) for 
   the period                       49              (40)           (105) 
----------------------  --------------   --------------   ------------- 
 
Profit attributable 
to: 
Reconciliation with 
Non-GAAP measure 
---------------------- 
 
Profit/(Loss) for the 
 period                             49              (40)           (105) 
  Add: 
  Depreciation and 
   Amortisation 
   expense                       1,323            1,213           1,306 
  Net Finance Expenses             588              361             547 
  Current Tax                      184              202             136 
  Less: 
  Deferred Tax                    (146)            (164)            (77) 
  Other Income 
   (including exchange 
   gain/loss)                      (35)             (53)            (23) 
 
  EBITDA                         1,963            1,519           1,784 
----------------------  --------------   --------------   ------------- 
 
 

Management-defined Performance Measures (MPMs)

Sify uses Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA) as the management-defined performance measure in its public communications. This measure is not specified by IFRS Accounting Standards and therefore might not be comparable to apparently similar measures used by other entities.

Management believes adjusting operating profit for these items provides comprehensive information of the company's operating performance.

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