My biggest percentage gainer of the year is from…Pakistan? Hard to believe, but NetSol (NTWK), a Pakistani business process outsourcing and lease management software company, is up 90% from where I bought it less than two months ago!
The rise wasn’t entirely unexpected. The shares were dirt cheap, and the company had a strong cash position and its financial results showed signs of improvement.
NetSol’s first quarter report confirms that the company has turned the corner. Revenues increased 19% year-over-year to $9.1 million, driven by improvement in all three of NetSol’s business lines (service, licensing, and maintenance). Gross margin rose from 48% to 56%. For the quarter, NetSol earned $2.3M, or $.09 per diluted share, on a GAAP basis, and $3.2M, or $.13 per diluted share, on an EBITDA basis. Both measures were dramatic improvements over the prior year results.
Just as importantly, NetSol reiterated guidance for fiscal year 2008 of 25-30% growth in annual revenues, and diluted EPS of $.28-$.32.
Chairman and CEO Najeeb Ghauri stated:
Our third quarter results provide an excellent start to the second half of fiscal 2008, which is historically NetSol’s stronger half-year period. With double-digit year-over-year growth in services, licenses, and maintenance fees translating into a significant rise in profitability, we remain on track to achieve our full year top and bottom line financial objectives….For more on this article, please click on the following link: Greetings from Pakistan: NetSol Delivers Solid Gains for US Investors: SeekingAlpha.com
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