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Luxoft Holding, Inc Reports Results For Three And Six Months Ended September 30, 2015

The following excerpt is from the company's SEC filing.

LONDONNovember 10, 2015 Luxoft Holding, Inc (NYSE:LXFT), a leading provider of software development services and innovative IT solutions to a global client base, today announced results for the three and six months ended September 30, 2015.

Highlights Three Months Ended September 30, 2015

US GAAP revenue amounted to $161.5 million, an increase of 29.1% year over year and 9.1% sequentially on the reporting currency basis and 39.5% increase on the constant currency basis

Earnings before interest, taxes, depreciation and amortization (EBITDA) adjusted for stock based compensation, acquisitio n related costs and change in fair value of contingent consideration was $37.0 million; adjusted EBITDA margin was 22.9%, compared to $24.4 million and 19.5% in the year-ago quarter and $27.2 million and 18.4% in the previous quarter

Operating income increased 25.5% year over year and 69.1% sequentially, generating 16.0% margin on a US GAAP basis, as compared to 16.5% in the year-ago quarter and 10.3% in the previous quarter

Diluted earnings per share (EPS) on a US GAAP basis was $0.67, compared to $0.54 in the year-ago quarter and $0.43 in the previous quarter

Diluted EPS on a non-GAAP basis was $0.84, compared to $0.58 in the year-ago quarter, and $0.61 in the previous quarter

Highlights Six Months Ended September 30, 2015

US GAAP revenue amounted to $309.6 million, an increase of 30.4% year over year on the reporting currency basis and 42.1% increase on the constant currency basis

Adjusted EBITDA increased 47.7% year over year to $64.2 million and adjusted EBITDA margin was 20.7%, as compared to $43.4 million and 18.3% in a year ago period

US GAAP operating income increased to $41.2 million or 18.7% year over year

Diluted EPS on a US GAAP basis was $1.11, compared to $0.92 in the first half of last year, representing 20.7% increase over the same period last year

Diluted EPS on a non-GAAP basis was $1.45, compared to $1.03 in the first half of last year, representing 40.8% increase over the same period last year

Revenue for the three months ended September 30, 2015 increased to $161.5 million, up 29.1% from $125.1 million for the same period a year ago and 9.1% sequentially. Adjusted EBITDA was $37.0 million and corresponding margins of 22.9%, as compared to $24.4 million and 19.5% respectively in the year-ago quarter and $27.2 million and 18.4% sequentially. US GAAP net income was $23.0 million, or $0.67 per diluted share, compared to $17.6 million and $0.54 per diluted share for the same period a year ago and $14.6

million and $0.43 sequentially. Non-GAAP net income was $28.6 million, or $0.84 per diluted share, compared to $19.0 million and $0.58 per diluted share for the same period a year ago and $20.6 million and $0.61 sequentially. Reconciliations between non-GAAP financial measures and US GAAP operating results and diluted EPS are included at the end of this release.

Revenue for the six months ended September 30, 2015 increased to $309.6 million, up 30.4% from $237.4 million for the same period a year ago. Adjusted EBITDA increased 47.7% year over year to $64.2 million; adjusted EBITDA margin was 20.7%, as compared to $43.4 million and 18.3% in a year ago period. Operating income was $41.2 million, an increase of 18.7% year over year from $34.7 million in the first half of last year. US GAAP net income was $37.6 million, or $1.11 per diluted share, compared to $30.2 million and $0.92 per diluted share for the same period a year ago. Non-GAAP net income was $49.2 million, or $1.45 per diluted share, compared to $33.7 million and $1.03 per diluted share for the same period a year ago.

I am pleased to announce another strong set of earnings for the quarter and the first half of our financial year built upon a continuously high level of demand for complex software development services, end-to-end solutions, and technology consulting, stated Dmitry Loschinin, CEO and President of Luxoft Holding, Inc. Our end-to-end offerings created organically and complemented by acquisitions over the past year helped us win several landmark contracts with High Potential Accounts (HPAs) and maintain healthy pipeline of opportunities ahead. We have secured four new HPAs in the past quarter: two in automotive, one in telecom and one in financial services. Credit Suisse, which made it into a Top 5 accounts in the second quarter, and another client, a major online travel conglomerate, are now part of our Top 10 account list. Finally, we realized some important cross-selling opportunities between Luxoft and Excelian, leading to six deals with North American, Western European and Asian clients. We continue building our premium consulting services capabilities, moving upwards in the value chain, and rapidly expanding relationships with packaged solution providers, such as OpenLink and Calypso, in addition to our existing Murex-based practice. Thus, an annual increase in revenues generated by our core verticals during the first half of the year ranged between 26% and 57%, which leads us to believe that our strategy of focusing on select niche domain expertise and becoming a business IT solutions specialist provider is paying off.

For the six months ending September 30, 2015, technology, financial services, automotive and transport, and telecom were the strongest performers, delivering 57.5%, 34.6%, 29.8% and 26.1% of revenue growth respectively, compared to the first six months of last year. The main growth drivers in the financial services are: digital transformation, new disruptive banking models; pressure to comply with the regulations; need for standardization, cost control and transparency; demand for advanced business solutions and associated consulting. Main growth drivers in automotive are: strong demand in Human Machine Interface (HMI) development, substantial interest in autonomous driving from OEMs; opportunities brought by Internet of Things (IoT) to further developments in the connected car space.

Key revenue generating geographies continued to grow: revenues generated in the U.S. increased 2.9%, in the U.K. increased 55.4% and in Germany increased 24.0%, compared to the first six months of last year. Growth of revenues continued to outpace growth in delivery headcount. The company generated approximately 7.1% increase in revenue per delivery employee. During the last quarter the total headcount crossed 10,000 employees to reach 10,058 as of September 30, 2015, while maintaining low attrition.

We are happy to report to our...


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