“The quarter reflects continued progress in the implementation of our large NFS Ascent contract, as well as investment to enhance our strategic position and delivery capability in Europe,” said Najeeb Ghauri, CEO of NetSol. “Today we are at a pivotal stage for the company, approaching a time of record revenue, with further momentum highlighted by a healthy new business pipeline for NFS Ascent TM and NFS TM, continued upgrades and demand for our legacy region-specific solutions, and new agreements in Europe that have yet to contribute to results.
“Adding to our confidence is the relaxation of restrictions for new finance and leasing market entrants into China, where our NFS solution has the dominant market share; improved finance and leasing markets in the U.S. and Europe, where we continue to make progress; and China’s investment in Pakistan, which is expected to help the overall business environment, quality of life and security profile of the country,” Ghauri said.
Following is additional detail for the quarter:
- Increase in cost of revenues, related to the hiring and training of technical employees, as well as the timing of salary increases. Operational expenses also increased as a result of new business activities. Expenses are expected to remain at the current level as new hiring has slowed, with the addition of seven people in the quarter;
- Cash and cash equivalents were $10.9 million, of which approximately $7.3 million were held by the company’s foreign subsidiaries;
- Accounts receivable were $7.6 million, compared to $5.4 million last year. The quality of receivables remains strong; and
- The company purchased 1.58 million shares of NetSol PK common stock from the open market for $577,000, resulting in an overall decrease in non-controlling interest from 36.6% to 34.9%.