Bangalore-based Mascot Systems came out with third quarter ended 31 December 2002 results before trading hours on Thursday. For Q3, the software company posted a 36.53% fall in net profit to Rs 6.67 crore (Rs 10.71 crore) on operating revenues of Rs 97.71 crore (Rs 97.46 crore).

The company's quarterly net profit has turned out a wee bit below a capitalmarket.com poll estimate. According to the poll (that assessed three IT analysts), for the quarter ended 31 December 2002, the software major was expected to post a 28.6-35.3% fall in net profit to Rs 6.8-7.5 crore.

Mascot's revenues have beaten analysts' expectations of between Rs 92.5 crore and Rs 96.8 crore for the quarter, a drop of 0.7-5%.

Sequentially, the company registered a net profit growth of 2.7% from Rs 6.49 crore in SQ 2002 on an 8.3% increase in revenues from Rs 90.2 crore. Operating profit, on a sequential basis, have also surged 14.2% to Rs 8.67 crore from Rs 7.59 crore.

Mascot Systems is a leading provider of solutions for application maintenance outsourcing, e-business, business intelligence, application re-engineering, custom solutions and embedded systems. Mascot uses its proprietary solutions suite, SmartAPPSSM, as the framework for its distributed delivery. Mascot Systems has established operations in the United States, United Kingdom, Belgium, Germany, the Netherlands, Sweden, Japan, Singapore and Australia. The company has built a strong infrastructure capability that comprises over 1,600 employees worldwide and world-class offshore development centres in Bangalore and Chennai.

Mascot focuses on the finance and banking, retail and distribution, manufacturing, telecommunications and service industries.

In the last quarter (September-December 2002), the company acquired the prestigious Software Engineering Institute - Capability Maturity Model Level 5 certification for quality of software processes. The company was also awarded the BS7799 Security Compliance Certification that assesses security of a wide range of information systems and processes. These certifications enhance the company's competitive advantage in the global marketplace.

Recently, the company acquired eJiva, a Toronto-based development center, effective 1 January 2003, and Aqua Regia, effective 1 April 2003, to provide critical mass, enhance client profile, expand depth and range of services and strengthen sales and marketing, increasing Mascot's potential to compete for large business engagements

Meanwhile, Mascot is looking at investing in the Business Process Outsourcing space in the next 12 to 18 months and is also considering acquisition of companies in this space in India. The company is planning to acquire early stage BPO companies with 300 to 500 agents, either into call centres or transaction processing (claims management, post sales support, etc.).

As on 30 September 2002, promoters' holding in Mascot was 88.4%, while the public and institutions held 4.77% and 5.21%, respectively.