Kale Airlines Division grows 21%, achieves breakthrough into large Airlines
Kale Consultants Ltd, a leading software solutions and
outsourced services provider to the Aviation and Travel
Industry has recorded revenues of Rs 124.24 million for
the quarter ended September 30, 2004 , compared with Rs
117.07 million in the corresponding quarter in the previous
year. The Airline Division grew 21% from Rs 94.11 million
to Rs 114.01 million.
On a serial quarter basis, Kale grew 24%, having recorded
revenue of Rs 99.98 million in Q1 FY05.
The company recorded a PAT of Rs 5.18 million in the six
month period ended September 30, 2004 compared to Rs 3.05
million in the corresponding period of the previous year.
Kale's subsidiary for Travel Technology, Kale eTravel Technology
Pvt. Limited (formerly Cognosys Software Pvt. Ltd.), posted
revenues of Rs. 40.27 million during the six month period
ended September 30, 2004 with a PAT of Rs 1.97 million.
It is in the process of being merged with Kale. Taken together,
the top line for the six month period is Rs 264.49 million
and bottom line Rs 7.15 million.
Commenting on the performance, Mr. Vipul Jain, CEO &
Managing Director said, "We continue to forecast strong
growth as we are in the process of implementation of recently
acquired orders. This quarter, two of the top ten Airlines
in the world have become our customers. This is a significant
milestone as, hitherto we have been very strong in the mid-market
Airline segment. our presence in the large carrier segment
has been limited. These wins are indicative of Kale's credentials
as a world class software solutions and outsourced services
provider.”
Airlines Division –
Consistent Growth
Kale provides a range of solutions to the Airline industry-
with particular focus on Air Cargo and PRA solutions. Growth
continued in Q2 FY05 at 21% over the corresponding quarter.
Managed Process Services (MPS), using Kale's award winning
software products, has been a strong growth driver with
a CAGR of over 73% over the last three years. Revenues from
the long term, multi year contracts of MPS contributed 68%
of Airline revenue in Q2 FY05 as compared to 55% in Q2 FY04.
The company's product, APEX™, is one of the only
two proration engines selected globally by IATA for Neutral
Fare Proration (NFP), the core component of their recently
launched initiative - “First & Final Interline
Billing Service.” This represents a very significant
opportunity.
APEX™ chosen by two major international airlines
as their Proration engine . With these two wins, Kale has
established itself as a credible provider of software solutions
to the top airlines in the world.
One of the international carriers has selected Kale's APEX™
as a proration Engine for Neutral Fare Proration. NFP forms
the core of the “First and Final Interline Billing
Service”, launched by IATA recently. By using APEX™,
the carrier can now obtain consistent and reliable proration
results. While the implementation will take another few
months, the win has further strengthened the position of
the company in the airline sector. With this win, Kale now
boasts of 4 clients among the top 20 airlines around the
world
The other international airline major will use Kale's APEX™
for in-house proration engine to handle its complex itineraries.
APEX™ will help the airline to simplify complicated
itinerary pricing, determine sector revenue and calculate
accurate profitability.
The company launched CSP™, an enterprise-wide Cargo
Operations & Management solution, globally to replace
the existing legacy systems. The successful implementation
at Asiana, the 14 th largest cargo airline in the world,
has helped the customer obtain substantial improvements
to business processes and vital revenue information for
making strategic decisions. The solution is at use in a
mission critical 24x7 environment over 50 stations and 500
users world-wide. This is an important milestone in the
product lifecycle and marks the beginning of product promotion
and customer acquisition phase.
Travel Division –
New Growth Engine
Kale acquired Cognosys, a travel technology company with
cutting edge products and leading customers, in FY04. The
integration has been completed with assimilation of skills
and business knowledge of the two teams. Cognosys, a subsidiary,
and now branded as Kale Travel Technology Division, posted
revenues of Rs. 18.69 million in Q2 of this year.
Business Outlook
Kale is the leading provider of software solutions to the
Airline and Travel industries. Its solutions comprise of
software products, hosted solutions or end-to-end business
process outsourcing. Its competitive edge is in-depth understanding
of the industry processes and ability to deliver demonstrable
value through a fine blend of IPR, consulting, technical
and processing skills.
The company has deep domain knowledge, marquee customers
and strong branding in the Airline and Travel industry segments.
The Product + BPO model is very synergistic and provides
customers with a “True Outsourcing” value proposition.
Products and IPR give differentiation and build entry barriers,
along with branding. BPO gives scale, long term revenue
visibility and predictability.
The airline industry is increasingly using IT as a strategic
tool to sustain and grow in the highly competitive market
place. The Travel industry, which is the biggest industry
globally, is doing likewise. Both these industries have
just started seeing the benefits of offshore outsourcing.
Hence there is huge opportunity for Kale to be a large dominant
global player.
Order book of the company is healthy with addition of many
new customers and pipeline is strong. Major phase of investments
in products development, marketing and BPO operations is
already completed.
For additional information,
please contact:
Mr. Sumeet Nadkar
Chief Financial Officer
Kale Consultants Ltd.
Tel: 91-22-28259580
Email: Sumeet_Nadkar@kaleconsultants.com
Safe Harbor
Certain statements in this release concerning our future
growth prospects are forward-looking statements which involve
a number of risks and uncertainties that could cause actual
results to differ materially from those in such forward-looking
statements. The risks and uncertainties relating to these
statements include, but are not limited to, risks and uncertainties
regarding fluctuations in earnings, our ability to manage
growth, intense competition in IT services including those
factors which may affect our cost advantage, wage increases
in India, our ability to attract and retain highly skilled
professionals, time and cost overruns on fixed-price, fixed-time
frame contracts, client concentration, restrictions on immigration,
our ability to manage our international operations, reduced
demand for technology in our key focus areas, disruptions
in telecommunication networks, our ability to successfully
complete and integrate potential acquisitions, liability
for damages on our service contracts, withdrawal of governmental
fiscal incentives, political instability, legal restrictions
on raising capital or acquiring companies outside India,
and unauthorized use of our intellectual property and general
economic conditions affecting our industry. The company
does not undertake to update any forward-looking statement
that may be made from time to time by or on behalf of the
company.
