Genpact Reports Financial Results for the Second Quarter of 2008

Aug 5, 2008
Second Quarter Revenues Grow 26% year over year Adjusted Income from Operations Increases 40% year over year
GURGAON, India & NEW YORK, Aug 05, 2008 (BUSINESS WIRE) -- Genpact Limited (NYSE:G), a leader in the globalization of services and technology and a pioneer in managing business processes for companies around the world, today announced financial results for the second quarter ended June 30, 2008.

Key Financial Results - Second Quarter 2008

-- Revenues were $253.6 million, up 26% from the second quarter of 2007.

-- Net income was $24.8 million, up 250% from $7.1 million in the second quarter of 2007; net income margin for the second quarter of 2008 was 9.8%, up from 3.5% in the second quarter of 2007.

-- Earnings per common share were $0.11, up from a loss of $0.17 per share in the second quarter of 2007.

-- Adjusted income from operations increased 40% to $41.8 million compared to the second quarter of 2007.

-- Adjusted income from operations margin was 16.5%, up from 14.9% in the second quarter of 2007.

-- Adjusted diluted earnings per share were $0.18, up from $0.10 in the second quarter of 2007.

Pramod Bhasin, Genpact's President and CEO said, "Our excellent second quarter results continue our track record of strong growth and delivering on our commitments. Given our results to date and our expectations for the remainder of the year, we are increasing our full year revenue guidance and our guidance on adjusted income from operations margin. We expect revenues for the full year to grow organically by 26-28% from $823 million in 2007. As a result of increased internal efficiencies, a shift towards higher value work and improved pricing for the value we deliver, we now expect our adjusted income from operations margin to improve by 80 to 100 basis points to between 17.1% and 17.3% in 2008 from 16.3% in 2007. Genpact's Six Sigma, process and technology expertise are driving market penetration and sustainable, superior growth as we create value for our clients and all our key stakeholders."

Global Client revenues increased 68% over the second quarter of 2007 (growth with existing clients, or organic growth, was 75%), driven by Genpact's ability to expand its existing client relationships and build new ones.

Genpact continues to expand its client base. Among new additions are:

-- a large office products company;

-- a global leader in healthcare, lighting and consumer lifestyle products;

-- a leading UK-based financial services group providing a wide range of banking and financial services; and

-- a global financial services company operating in automotive finance, real estate finance, insurance and commercial finance businesses.

GE revenues for the second quarter of 2008 grew 1% over the second quarter of 2007. Organic GE revenue growth was 9% this quarter. This excludes revenues from businesses divested by GE in 2007, all of which Genpact continues to serve and whose revenues are now included in Global Client revenues.

As of the end of the second quarter of 2008, 25 clients each accounted for $5 million or more of Genpact's revenues in the last twelve months. Of those, four clients each accounted for $25 million or more of Genpact's revenues in the last twelve months.

Among the many services and solutions Genpact provides to its clients, the mix between business process services and IT services revenues remained relatively steady in the second quarter of 2008, with business process services contributing approximately 79% of revenues in the second quarter of 2008 up from 76% for the full year 2007.

Genpact generated $48 million of cash from operations in the second quarter of 2008, up from $44 million in the second quarter of 2007.

Year-to-Date Results

-- Revenues were $488.2 million, up 30% from the first half of 2007.

-- Net income was $44.5 million, up 398% from $8.9 million in the first half of 2007; net income margin for the first half of 2008 was 9.1%, up from 2.4% in the first half of 2007.

-- Earnings per common share were $0.20, up from a loss of $0.39 per share in the first half of 2007.

-- Adjusted income from operations increased 37% to $70.2 million compared to the first half of 2007.

-- Adjusted income from operations margin was 14.4%, up from 13.6% in the first half of 2007.

-- Adjusted diluted earnings per share were $0.32, up from $0.16 in the first half of 2007.

Annualized revenue per employee in the first half of 2008 was approximately $29,700, an increase from approximately $28,200 for the full year of 2007. As of June 30, 2008, Genpact had more than 35,500 employees worldwide. Genpact's attrition rate for the first half of 2008, measured from day one of employment, was 25% compared to 30% in 2007. Genpact's attrition rate would be 19% if measured after six months of employment as many of Genpact's competitors do.

Revised Presentation of the Income Statement

In order to more clearly reflect Genpact's costs, including the impact of its long-term foreign exchange hedging strategy, Genpact has reclassified its foreign exchange gains or losses from a separate line item forming part of income from operations to selling, general and administrative expenses, cost of revenue or net revenues, as applicable. The residual foreign exchange gains or losses, primarily relating to the re-measurement of foreign currency assets or liabilities, mainly accounts receivable, are now shown on the income statement below income from operations. This reclassification does not affect net income or earnings per share. The financial data contained in this press release reflect such reclassification.

Conference Call to Discuss Financial Results

Genpact management will host a conference call at 8 a.m. (Eastern Daylight Time) on August 6, 2008 to discuss the Company's performance for the periods ended June 30, 2008. To participate, callers can dial 1 (866) 800-8652 from within the U.S. or 1 (617) 614-2705 from any other country. Thereafter, callers need to enter the participant passcode, which is 39842521.

Conference Call to Discuss Revised Presentation of Income Statement

Genpact management will host a second conference call at 9.30 a.m. (Eastern Daylight Time) on August 6, 2008 to discuss the revised presentation of the Company's income statement. To participate, callers can dial 1 (866) 800-8652 from within the U.S. or 1 (617) 614-2705 from any other country. Thereafter, callers need to enter the participant passcode, which is 39842521.

For those who cannot participate in the calls, a replay and podcast will be available on our website, www.genpact.com, after the end of the calls. A transcript of both calls will also be made available on our website.

About Genpact

Genpact is a leader in the globalization of services and a pioneer in managing business processes for companies around the world. The company combines process expertise, information technology and analytical capabilities with operational insight and experience in diverse industries to provide a wide range of services using its global delivery platform. Genpact helps companies improve the ways in which they do business by applying Six Sigma and Lean principles plus technology to continuously improve their business processes. Genpact operates service delivery centers in India, China, Hungary, Mexico, the Philippines, the Netherlands, Romania, Spain and the United States. For more information, see our website at: www.genpact.com.

Safe Harbor

This press release contains certain statements concerning our future growth prospects and forward-looking statements, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those in such forward-looking statements. These risks and uncertainties include but are not limited to the risks and uncertainties arising from our past and future acquisitions, slowdown in the economies and sectors in which our clients operate, a slowdown in the BPO and IT Services sectors, our ability to manage growth, factors which may impact our cost advantage, wage increases, our ability to attract and retain skilled professionals, risks and uncertainties regarding fluctuations in our earnings, general economic conditions affecting our industry as well as other risks detailed in our reports filed with the U.S. Securities and Exchange Commission, including the Company's Annual Report on Form 10-K. These filings are available at www.sec.gov. Genpact may from time to time make additional written and oral forward-looking statements, including statements contained in our filings with the Securities and Exchange Commission and our reports to shareholders. Although the company believes that these forward-looking statements are based on reasonable assumptions, you are cautioned not to pay undue reliance on these forward-looking statements, which reflect management's current analysis of future events. The Company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the Company.

                 Genpact Limited and its Subsidiaries

                     Consolidated Balance Sheets
                (In thousands, except per share data)

                                                         (Unaudited)
                                    As of December 31,  As of June 30,
                                           2007              2008
                                    ------------------  --------------
Assets
Current assets
  Cash and cash equivalents         $          279,306  $      297,978
  Accounts receivable, net                      99,354         131,377
  Accounts receivable from a
   significant shareholder, net                 93,307          89,993
  Short term deposits with a
   significant shareholder                      35,079          25,602
  Deferred tax assets                            9,683           8,956
  Due from a significant
   shareholder                                   8,977           6,084
  Prepaid expenses and other
   current assets                              146,155         130,650
                                    ------------------  --------------
    Total current assets                       671,861         690,640

  Property, plant and equipment,
   net                                         195,660         177,959
  Deferred tax assets                            2,196          58,580
  Investment in equity affiliate                   197             760
  Customer-related intangible
   assets, net                                  99,257          77,390
  Other intangible assets, net                  10,375           7,491
  Goodwill                                     601,120         588,741
  Other assets                                 162,800          79,858
                                    ------------------  --------------
    Total assets                    $        1,743,466  $    1,681,419
                                    ==================  ==============


                 Genpact Limited and its Subsidiaries

                     Consolidated Balance Sheets
                (In thousands, except per share data)

                                                         (Unaudited)
                                     As of December 31, As of June 30,
                                            2007             2008
                                     ------------------ --------------
Liabilities and shareholders' equity
------------------------------------
Current liabilities
  Current portion of long-term debt  $           19,816 $       19,872
  Current portion of long-term debt
   from a significant shareholder                 1,125          1,231
  Current portion of capital lease
   obligations                                       38             40
  Current portion of capital lease
   obligations payable to a
   significant shareholder                        1,826          1,666
  Accounts payable                               12,446         11,110
  Income taxes payable                            7,035         21,372
  Deferred tax liabilities                       20,561          6,206
  Due to a significant shareholder                8,930          8,736
  Accrued expenses and other current
   liabilities                                  197,298        244,821
                                     ------------------ --------------
    Total current liabilities        $          269,075 $      315,054

Long-term debt, less current portion            100,041         90,090
Long-term debt from a significant
 shareholder, less current portion                2,740          2,352
Capital lease obligations, less
 current portion                                    137            120
Capital lease obligations payable to
 a significant shareholder, less
 current portion                                  2,969          2,503
Deferred tax liabilities                         40,738         12,626
Due to a significant shareholder                  8,341          6,525
Other liabilities                                65,630        192,197
                                     ------------------ --------------
    Total liabilities                $          489,671 $      621,467
                                     ------------------ --------------

Minority interest                                 3,066          2,841

Shareholders' equity
Preferred shares, $0.01 par value,
 250,000,000 authorized, none issued                 --             --
Common shares, $0.01 par value,
 500,000,000 authorized, 212,101,874
 and 213,861,157 issued and
 outstanding as of December 31, 2007
 and June 30, 2008, respectively                  2,121          2,139
Additional paid-in capital                    1,000,179      1,017,344
Retained earnings                                26,469         70,979
Accumulated other comprehensive
 income (loss)                                  221,960       (33,351)
                                     ------------------ --------------
    Total shareholders' equity                1,250,729      1,057,111
Commitments and contingencies                        --             --
                                     ------------------ --------------
Total liabilities, minority interest
 and shareholders' equity            $        1,743,466 $    1,681,419
                                     ------------------ --------------


                 Genpact Limited and its Subsidiaries

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)

                           Three months ended      Six months ended
                                June 30,               June 30,
                         ---------------------- ----------------------
                            2007       2008        2007       2008
                         ---------- ----------- ---------- -----------
Net revenues
  Net revenues from
   services --
   significant
   shareholder           $  124,218 $   125,851 $  244,990 $   240,174
  Net revenues from
   services -- others        76,041     127,721    130,473     248,008
  Other revenues                427           4      1,382          20
                         ---------- ----------- ---------- -----------
    Total net revenues      200,686     253,576    376,845     488,202
                         ---------- ----------- ---------- -----------
Cost of revenue
  Services                  120,444     147,092    228,566     293,173
  Others                        299           -      1,034           -
                         ---------- ----------- ---------- -----------
    Total cost of
     revenue                120,743     147,092    229,600     293,173
                         ---------- ----------- ---------- -----------
Gross profit                 79,943     106,484    147,245     195,029

Operating expenses:
  Selling, general and
   administrative
   expenses                  52,516      66,632    100,644     128,769
  Amortization of
   acquired intangible
   assets                     9,437       9,601     18,629      19,825
  Other operating
   (income) losses, net     (1,160)       1,073    (1,723)        (64)
                         ---------- ----------- ---------- -----------
Income from operations   $   19,150 $    29,178 $   29,695 $    46,499

Foreign exchange (gains)
 losses, net                  (431)         883      (457)     (5,833)
Other income (expense),
 net                        (3,498)       3,148    (7,078)       5,022
                         ---------- ----------- ---------- -----------

Income before share of
 equity in (earnings)
 loss of affiliate,
 minority interest and
 income tax expense          16,083      31,443     23,074      57,354

Equity in loss of
 affiliate                        7         110         80         319

Minority interest             2,788       3,141      3,692       5,982

Income tax expense            6,195       3,376     10,363       6,543
                         ---------- ----------- ---------- -----------
Net Income               $    7,093 $    24,816 $    8,939 $    44,510
                         ========== =========== ========== ===========

Net income (loss)
 available to common
 shareholders              (11,913)      24,816   (26,613)      44,510
Earnings (loss) per
 common share -
  Basic                  $   (0.17) $      0.12 $   (0.39) $      0.21
  Diluted                $   (0.17) $      0.11 $   (0.39) $      0.20
                         ========== =========== ========== ===========

Weighted average number
 of common shares used
 in computing earnings
 (loss) per common share
 -
  Basic                  69,462,052 213,001,442 68,841,133 212,599,543
  Diluted                69,462,052 218,863,648 68,841,133 218,151,069


                 Genpact Limited and its Subsidiaries

                Consolidated Statements of Cash Flows
                             (Unaudited)
                            (In thousands)

                                                 Six months ended
                                                     June 30,
                                             -------------------------
                                                 2007         2008
                                             ------------ ------------
Operating activities
Net income                                   $      8,939 $     44,510
Adjustments to reconcile net income to net
 cash provided by (used for) operating
 activities:
Depreciation and amortization                      22,509       28,952
Amortization of debt issue costs                      318          332
Amortization of acquired intangible assets         19,155       20,325
Loss on sale of property, plant and
 equipment, net                                        40        2,228
Provision for doubtful receivables                  1,675        2,022
Provision for mortgage loans                            -          580
Unrealized (gain) loss on revaluation of
 foreign currency asset, liability                  1,647      (2,684)
Equity in loss of affiliate                            80          319
Minority interest                                   3,692        5,982
Share-based compensation expense                    5,231        8,309
Deferred income taxes                             (1,799)      (9,932)
Change in operating assets and liabilities:
  Decrease (increase) in accounts receivable     (14,883)     (30,341)
  Decrease (increase) in other assets               (462)     (16,380)
  (Decrease) increase in accounts payable           3,818      (1,164)
  (Decrease) increase in accrued expenses
   and other current liabilities                  (8,514)      (3,856)
  (Decrease) increase in income taxes
   payable                                          7,741       14,220
  (Decrease) increase in other liabilities          3,608        5,959
                                             ------------ ------------
Net cash provided by operating activities    $     52,795 $     69,381
                                             ------------ ------------

Investing activities
Purchase of property, plant and equipment        (23,289)     (31,921)
Proceeds from sale of property, plant and
 equipment                                          1,156        3,790
Investment in affiliates                            (455)        (883)
Short term deposits placed                       (73,561)    (122,673)
Redemption of short term deposits                  62,313      129,627
Payment for business acquisition, net of
 cash acquired                                   (14,771)            -
                                             ------------ ------------
Net cash used in investing activities        $   (48,607) $   (22,060)
                                             ------------ ------------

Financing activities
Repayment of capital lease obligations            (1,381)      (1,356)
Proceeds from long-term debt                        1,525            -
Repayment of long-term debt                      (10,711)     (10,458)
Short-term borrowings, net                         14,675            -
Repurchase of common shares and preferred
 stock                                            (1,995)            -
Deferred IPO cost                                 (1,492)            -
Proceeds from issuance of common shares on
 exercise of options                                1,225        8,874
Payment to minority shareholders                  (2,104)      (5,631)
                                             ------------ ------------
Net cash (used) by financing activities      $      (258) $    (8,571)
                                             ------------ ------------

Effect of exchange rate changes                     9,664     (20,078)
Net increase (decrease) in cash and cash
 equivalents                                        3,930       38,750
Cash and cash equivalents at the beginning
 of the period                                     35,430      279,306
                                             ------------ ------------
Cash and cash equivalents at the end of the
 period                                      $     49,024 $    297,978
                                             ============ ============

Supplementary information
Cash paid during the period for interest     $      7,318 $      3,404
Cash paid during the period for income taxes $      4,337 $     12,937
Property, plant and equipment acquired under
 capital lease obligation                    $        930 $      1,057
Shares issued for business acquisition       $     23,265 $          -

Reconciliation of Adjusted Non-GAAP Financial Measures to GAAP Measures

To supplement the consolidated financial statements presented in accordance with GAAP, this press release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: non-GAAP adjusted income from operations, adjusted net income, adjusted earnings per share and pro forma earnings per share. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures, the financial statements prepared in accordance with GAAP and the reconciliations of Genpact's GAAP financial statements to such non-GAAP measures should be carefully evaluated.

For its internal management reporting and budgeting purposes, Genpact's management uses financial statements that do not include stock-based compensation expense related to employee stock options, amortization of acquired intangibles at formation in 2004 and additional depreciation due to mark-to-market adjustment at formation in 2004 for financial and operational decision-making, to evaluate period-to-period comparisons or for making comparisons of Genpact's operating results to that of its competitors. Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use when adopting FAS 123(R), Genpact's management believes that providing financial statements that do not include stock-based compensation allows investors to make additional comparisons between Genpact's operating results to those of other companies. In addition, Genpact's management believes that providing non-GAAP financial measures that exclude amortization of acquired intangibles and additional depreciation due to mark-to-market adjustment at formation allows investors to make additional comparisons between Genpact's operating results to those of other companies. The Company also believes that it is unreasonably difficult to provide its financial outlook in accordance with GAAP for a number of reasons including, without limitation, the Company's inability to predict its future stock-based compensation expense under FAS 123(R) and the amortization of intangibles associated with further acquisitions, if any. Accordingly, Genpact believes that the presentation of non-GAAP adjusted income from operations and adjusted net income, when read in conjunction with the Company's reported results, can provide useful supplemental information to investors and management regarding financial and business trends relating to its financial condition and results of operations.

In addition, for its internal management reporting for 2007, Genpact's management used adjusted earnings per share and pro forma earnings per share that do not include impact of the undistributed earnings to preferred stock, preferred dividend and beneficial interest on conversion of preferred stock dividend and assumes the preferred stock was converted to common shares. As of July 13, 2007, prior to the IPO, all the preferred stock has been converted to common shares. Accordingly, the Company believes that to evaluate period to period comparisons, the presentation of non-GAAP adjusted earnings per share and pro forma earnings per share when read in conjunction with the Company's reported results, can provide useful supplemental information to investors and management regarding financial and business trends relating to its financial condition and results of operations.

A limitation of using non-GAAP adjusted income from operations and adjusted net income versus income from operations and net income calculated in accordance with GAAP is that non-GAAP adjusted income from operations and adjusted net income excludes costs, namely, stock-based compensation, that are recurring. Stock-based compensation has been and will continue to be a significant recurring expense in Genpact's business for the foreseeable future. Management compensates for this limitation by providing specific information regarding the GAAP amounts excluded from non-GAAP adjusted income from operations and adjusted net income and evaluating such non-GAAP financial measures with financial measures calculated in accordance with GAAP.

During the second quarter of 2008, Genpact has reclassified its foreign exchange gains or losses from a separate line item in order to more clearly reflect Genpact's costs, including the impact of its long-term foreign exchange hedging strategy. This reclassification affects income from operations and consequently affects adjusted income from operations. This reclassification does not affect adjusted net income or adjusted earnings per share.

The following tables show the reconciliation of the adjusted financial measures from GAAP on a reclassified basis for the periods ended June 30, 2008:

          Reconciliation of Adjusted Income from Operations

                             (Unaudited)
                            (In thousands)

                      Quarter Ended June 30, Six months Ended June 30,
                      ---------------------- -------------------------
                         2007        2008        2007         2008
                      ----------- ---------- ------------ ------------

Income from
 operations as per
 GAAP (reclassified
 basis)               $    19,150 $   29,178 $     29,695 $     46,499
  Add: Amortization
   of acquired
   intangible assets
   resulting from
   Formation
   Accounting               9,281      9,297       18,515       19,257
  Add: Additional
   depreciation due
   to fair value
   adjustment
   resulting from
   Formation
   Accounting                 514         14        1,028           28
  Add: Share based
   compensation             3,296      4,382        5,231        8,309
  Add: FBT impact on
   share based
   compensation
   recovered from
   employees                   --      1,453           --        1,553
  Add: Gain (loss) on
   interest rate
   swaps                       15          -         (20)        (283)
  Add: Other income           434        737          710         1173
  Less: Equity in
   loss of affiliate          (7)      (110)         (80)        (319)
  Less: Minority
   interest               (2,788)    (3,141)      (3,692)      (5,982)
                      ----------- ---------- ------------ ------------
Adjusted income from
 operations           $    29,895 $   41,810 $     51,387 $     70,235
                      =========== ========== ============ ============

                Reconciliation of Adjusted Net Income

                             (Unaudited)
                (In thousands, except per share data)

                      Quarter Ended June 30, Six months Ended June 30,
                      ---------------------- -------------------------
                         2007        2008        2007         2008
                      ----------- ---------- ------------ ------------

Net income as per
 GAAP                 $     7,093 $   24,816 $      8,939 $     44,510
  Add: Amortization
   of acquired
   intangible assets
   resulting from
   Formation
   Accounting               9,281      9,297       18,515       19,257
  Add: Additional
   depreciation due
   to fair value
   adjustment
   resulting from
   Formation
   Accounting                 514         14        1,028           28
  Add: Share based
   compensation             3,296      4,382        5,231        8,309
  Add: FBT impact on
   share based
   compensation
   recovered from
   employees                   --      1,453           --        1,553
  Less: Tax impact on
   amortization of
   acquired
   intangibles
   resulting from
   Formation
   Accounting             (1,284)    (1,640)      (1,736)      (3,464)
                      ----------- ---------- ------------ ------------
Adjusted net income   $    18,900 $   38,322 $     31,977 $     70,193
                      =========== ========== ============ ============
Diluted adjusted
 earnings per share   $      0.10 $     0.18 $       0.16 $       0.32


            Reconciliation of Pro Forma Earnings Per Share

                             (Unaudited)
                (In thousands, except per share data)

                     Quarter Ended June 30,  Six months Ended June 30,
                     ----------------------- -------------------------
                        2007        2008         2007         2008
                     ----------- ----------- ------------- -----------

Net income (loss)
 available to common
 shareholders as per
 GAAP                $  (11,913) $    24,816 $    (26,613) $    44,510
  Add: preferred
   dividend                3,677          --         7,116          --
  Add: undistributed
   earnings to
   preferred stock         2,088          --         2,088          --
  Add: beneficial
   interest on
   conversion of
   preferred stock
   dividend               13,241          --        26,348          --
Pro forma net income
 available to common
 shareholders        $     7,093 $    24,816 $       8,939 $    44,510
Diluted pro forma
 earnings per share  $      0.04 $      0.11 $        0.05 $      0.20
Weighted average
 number of common
 shares used in
 computing dilutive
 earnings (loss) per
 common share as per
 GAAP                 69,462,052 218,863,648    68,841,133 218,151,069
  Pro forma dilutive
   effect of stock
   options             9,004,729          --     9,143,707          --
  Add: Impact of
   preferred stock
   converted into
   common stock (a)  119,231,521          --   119,231,595          --
                     ----------- ----------- ------------- -----------
Weighted average
 number of adjusted
 common shares used
 in computing
 adjusted and pro
 forma dilutive
 earnings (loss) per
 common share        197,698,302 218,863,648   197,216,435 218,151,069
                     ----------- ----------- ------------- -----------


(a)  Pro forma earnings per share give effect to Genpact's 2007
      reorganization of legal entities as if it occurred on January 1,
      2007. In Genpact's 2007 reorganization, the shareholders of
      Genpact Global Holdings exchanged their preferred and common
      shares of Genpact Global Holdings for common shares of Genpact
      Limited.






     Statements of Income on a Historical and Reclassified Basis

                         (Q1 2006 - Q2 2008)






                                                      Historical Basis
----------------------------------------------------------------------
                 Genpact Limited and its Subsidiaries
                              (Table A)

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)

                                                 Quarter Ended
                                          ----------------------------
                                          March 31, 2008 June 30, 2008
                                          -------------- -------------
Net revenues
  Net revenues from services -
   significant shareholder                $      114,323 $     125,929
  Net revenues from services - others            120,094       127,800
  Other revenues                                      17             4
                                          -------------- -------------
    Total net revenues                           234,434       253,733
                                          -------------- -------------
Cost of revenue
  Services                                       157,599       153,165
  Others                                               -             -
                                          -------------- -------------
    Total cost of revenue                        157,599       153,165
                                          -------------- -------------
Gross profit                                      76,835       100,568

Operating expenses:
  Selling, general and administrative
   expenses                                       66,089        68,818
  Amortization of acquired intangible
   assets                                         10,224         9,601
  Foreign exchange (gains) losses, net          (22,377)       (7,219)
  Other operating income                         (1,138)         1,073
                                          -------------- -------------
Income from operations                            24,037        28,295

Other income (expense), net                        1,874         3,148
                                          -------------- -------------

Income before share of equity in
 (earnings) loss of affiliate, minority
 interest and income taxes                        25,911        31,443

Equity in loss of affiliate                          210           110

Minority interest                                  2,842         3,141

Income tax expense (benefit)                       3,166         3,376
                                          -------------- -------------
Net Income                                $       19,693 $      24,816
                                          ============== =============


                                                    Reclassified Basis
----------------------------------------------------------------------
                 Genpact Limited and its Subsidiaries
                              (Table B)

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)

                                                 Quarter Ended
                                          ----------------------------
                                          March 31, 2008 June 30, 2008
                                          -------------- -------------
Net revenues
  Net revenues from services --
   significant shareholder                $      114,417 $     125,851
  Net revenues from services -- others           120,192       127,721
  Other revenues                                      17             4
                                          -------------- -------------
    Total net revenues                           234,626       253,576
                                          -------------- -------------
Cost of revenue
  Services                                       146,082       147,092
  Others                                               -             -
                                          -------------- -------------
    Total cost of revenue                        146,082       147,092
                                          -------------- -------------
Gross profit                                      88,544       106,484

Operating expenses:
  Selling, general and administrative
   expenses                                       62,136        66,632
  Amortization of acquired intangible
   assets                                         10,224         9,601
  Other operating income                         (1,138)         1,073
                                          -------------- -------------
Income from operations                    $       17,322 $      29,178

Foreign exchange (gains) losses, net             (6,715)           883
Other income (expense), net                        1,874         3,148
                                          -------------- -------------

Income before share of equity in
 (earnings) loss of affiliate, minority
 interest and income tax expense                  25,911        31,443

Equity in loss of affiliate                          210           110

Minority interest                                  2,842         3,141

Income tax expense                                 3,166         3,376
                                          -------------- -------------
Net Income                                $       19,693 $      24,816
                                          ============== =============


                 Genpact Limited and its Subsidiaries
                               (Table C)

                   Allocation of Reclassified Items
                             (Unaudited)
                (In thousands, except per share data)

                                                 Quarter Ended
                                          ----------------------------
                                          March 31, 2008 June 30, 2008
                                          -------------- -------------

Foreign exchange (gains) losses, net as
 reported on historical basis                   (22,377)       (7,219)
----------------------------------------------------------------------

Allocation of reclassified items:
  Increase (decrease) in net revenue                 192         (157)
  Decrease in cost of revenue                     11,517         6,073
  Decrease in selling, general and
   administrative expenses                         3,953         2,186
----------------------------------------------------------------------
  Total                                           15,662         8,102

----------------------------------------------------------------------
  Foreign exchange (gains) losses, net as
   reported on reclassified basis (1)            (6,715)           883


 (1)  Reclassified below income from operations.


                                                    Reclassified Basis
----------------------------------------------------------------------

          Reconciliation of Adjusted Income from Operations
                              (Table D)

                             (Unaudited)
                (In thousands, except per share data)


                                                 Quarter Ended
                                          ----------------------------
                                          March 31, 2008 June 30, 2008
                                          -------------- -------------

Income from operations as per GAAP
 (reclassified basis)                     $       17,322 $      29,178
  Add: Amortization of acquired
   intangible assets resulting from
   Formation Accounting                            9,960         9,297
  Add: Additional depreciation due to
   fair value adjustment resulting from
   Formation Accounting                               14            14
  Add: Share based compensation                    3,927         4,382
  Add: FBT impact on share based
   compensation recovered from employees             100         1,453
  Add: Gain (loss) on interest rate swaps          (283)            --
  Add: Other income                                  435           737
  Less: Equity in loss of affiliate                (210)         (110)
  Less: Minority interest                        (2,842)       (3,141)
                                          -------------- -------------
Adjusted income from operations           $       28,423 $      41,810
                                          ============== =============


                                                      Historical Basis
----------------------------------------------------------------------
                 Genpact Limited and its Subsidiaries
                              (Table E)

                  Consolidated Statements of Income
                (In thousands, except per share data)

                                               Year ended December 31,
                                               -----------------------
                                                  2006        2007
                                               ----------- -----------
Net revenues
  Net revenues from services -- significant
   shareholder                                 $   453,305 $   481,033
  Net revenues from services -- others             158,282     340,158
  Other revenues                                     1,460       1,493
                                               ----------- -----------
    Total net revenues                             613,047     822,684
                                               ----------- -----------
Cost of revenue
  Services                                         359,791     514,330
  Others                                             1,090       1,133
                                               ----------- -----------
    Total cost of revenue                          360,881     515,463
                                               ----------- -----------
Gross profit                                       252,166     307,221

Operating expenses:
  Selling, general and administrative expenses     159,203     231,320
  Amortization of acquired intangible assets        41,715      36,938
  Foreign exchange (gains) losses, net              13,021    (43,577)
  Other operating income                           (4,930)     (4,264)
                                               ----------- -----------
Income from operations                         $    43,157 $    86,804

Other income (expense), net                        (9,235)     (5,196)
                                               ----------- -----------

Income before share of equity in (earnings)
 loss of affiliate, minority interest and
 income taxes                                       33,922      81,608

Equity in loss of affiliate                             --         255

Minority interest                                       --       8,387

Income tax expense (benefit)                       (5,850)      16,543
Net Income                                     $    39,772 $    56,423
                                               =========== ===========



                                                    Reclassified Basis
----------------------------------------------------------------------
                 Genpact Limited and its Subsidiaries
                              (Table F)

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)


                                              Year ended December 31,
                                              ------------------------
                                                  2006        2007
                                              ------------ -----------
Net revenues
  Net revenues from services -- significant
   shareholder                                $    453,305 $   481,350
  Net revenues from services -- others             158,282     340,328
  Other revenues                                     1,460       1,493
                                              ------------ -----------
    Total net revenues                             613,047     823,171
                                              ------------ -----------
Cost of revenue
  Services                                         368,088     481,805
  Others                                             1,090       1,133
                                              ------------ -----------
    Total cost of revenue                          369,178     482,938
                                              ------------ -----------
Gross profit                                       243,869     340,233

Operating expenses:
  Selling, general and administrative
   expenses                                        162,019     218,237
  Amortization of acquired intangible assets        41,715      36,938
  Other operating income                           (4,930)     (4,264)
                                              ------------ -----------
Income from operations                        $     45,065 $    89,322

Foreign exchange (gains) losses, net                 1,908       2,518
Other income (expense), net                        (9,235)     (5,196)
                                              ------------ -----------

Income before share of equity in (earnings)
 loss of affiliate, minority interest and
 income tax expense                                 33,922      81,608

Equity in loss of affiliate                              -         255

Minority interest                                        -       8,387

Income tax expense (benefit)                       (5,850)      16,543
                                              ------------ -----------
Net Income                                    $     39,772 $    56,423
                                              ============ ===========


                 Genpact Limited and its Subsidiaries
                              (Table G)

                   Allocation of Reclassified Items
                             (Unaudited)
                (In thousands, except per share data)

                                            Year ended December 31,
                                          ----------------------------
                                               2006          2007
                                          -------------- -------------

Foreign exchange (gains) losses, net as
 reported on historical basis                     13,021      (43,577)
----------------------------------------------------------------------

Allocation of reclassified items:
  Increase in net revenues                             -           487
  Decrease (increase) in cost of revenue         (8,297)        32,525
  Decrease (increase) in selling, general
   and administrative expenses                   (2,816)        13,083
----------------------------------------------------------------------
  Total                                         (11,113)        46,095

----------------------------------------------------------------------
  Foreign exchange (gains) losses, net as
   reported on reclassified basis (1)              1,908         2,518



(1)  Reclassified below income from operations.

                                         Reclassified Basis
----------------------------------------------------------------------
          Reconciliation of Adjusted Income from Operations
                              (Table H)

                             (Unaudited)
                (In thousands, except per share data)


                                              Year Ended December 31,
                                              ------------------------
                                                  2006        2007
                                              ------------ -----------

Income from operations as per GAAP
 (reclassified basis)                         $     45,065 $    89,322
  Add: Amortization of acquired intangible
   assets resulting from Formation Accounting       42,738      35,764
  Add: Additional depreciation due to fair
   value adjustment resulting from Formation
   Accounting                                        2,056       2,056
  Add: Stock based compensation                      4,501      13,021
  Add: FBT Impact on Stock based compensation
   recovered from employees                                        507
  Add: Gain / (loss) on interest rate swaps          1,394        (41)
  Add: Other income                                  1,324       2,383
  Less: Equity in loss of affiliate                     --       (255)
  Less: Minority interest                               --     (8,387)
                                              ------------ -----------
Adjusted income from operations               $     97,078 $   134,370
                                              ============ ===========



                                                      Historical Basis
----------------------------------------------------------------------
                 Genpact Limited and its Subsidiaries
                              (Table I)

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)

                                       Quarter Ended
                      ------------------------------------------------
                      March 31,  June 30,   September 30, December 31,
                         2007       2007        2007          2007
                      ---------- ---------- ------------- ------------
Net revenues
  Net revenues from
   services -
   significant
   shareholder        $  120,772 $  124,218 $     122,862 $    113,181
  Net revenues from
   services - others      54,255     75,847        91,590      118,466
  Other revenues             955        427           110            1
                      ---------- ---------- ------------- ------------
    Total net
     revenues            175,982    200,492       214,562      231,648
                      ---------- ---------- ------------- ------------
Cost of revenue
  Services               109,150    128,248       132,991      143,941
  Others                     735        299            99            -
                      ---------- ---------- ------------- ------------
    Total cost of
     revenue             109,885    128,547       133,090      143,941
                      ---------- ---------- ------------- ------------
Gross profit              66,097     71,945        81,472       87,707

Operating expenses:
  Selling, general
   and administrative
   expenses               48,554     55,565        62,849       64,352
  Amortization of
   acquired
   intangible assets       9,192      9,437         9,358        8,951
  Foreign exchange
   (gains) losses,
   net                   (1,660)   (11,478)      (15,476)     (14,963)
  Other operating
   income                  (563)    (1,160)         (810)      (1,731)
                      ---------- ---------- ------------- ------------
Income from
 operations               10,574     19,581        25,551       31,098

Other income
 (expense), net          (3,580)    (3,498)         (619)        2,501
                      ---------- ---------- ------------- ------------

Income before share
 of equity in
 (earnings) loss of
 affiliate, minority
 interest and income
 taxes                     6,994     16,083        24,932       33,599

Equity in loss of
 affiliate                    73          7            61          114

Minority interest            904      2,788         2,062        2,633

Income tax expense
 (benefit)                 4,169      6,195         6,486        (307)
                      ---------- ---------- ------------- ------------
Net Income            $    1,848 $    7,093 $      16,323 $     31,159
                      ========== ========== ============= ============




                                                    Reclassified Basis
----------------------------------------------------------------------
                 Genpact Limited and its Subsidiaries
                              (Table J)

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)

                                       Quarter Ended
                      ------------------------------------------------
                      March 31,  June 30,   September 30, December 31,
                         2007       2007        2007          2007
                      ---------- ---------- ------------- ------------
Net revenues
  Net revenues from
   services --
   significant
   shareholder        $  120,895 $  124,338 $     122,981 $    113,136
  Net revenues from
   services -- others     54,310     75,921        91,678      118,419
  Other revenues             955        427           110            1
                      ---------- ---------- ------------- ------------
    Total net
     revenues            176,160    200,686       214,769      231,556
                      ---------- ---------- ------------- ------------
Cost of revenue
  Services               108,123    120,444       122,564      130,674
  Others                     735        299            99           --
                      ---------- ---------- ------------- ------------
    Total cost of
     revenue             108,858    120,743       122,663      130,674
                      ---------- ---------- ------------- ------------
Gross profit              67,302     79,943        92,106      100,882

Operating expenses:
  Selling, general
   and administrative
   expenses               48,126     52,516        59,035       58,560
  Amortization of
   acquired
   intangible assets       9,192      9,437         9,358        8,951
  Other operating
   income                  (563)    (1,160)         (810)      (1,731)
                      ---------- ---------- ------------- ------------
Income from
 operations           $   10,547 $   19,150 $      24,523 $     35,102

Foreign exchange
 (gains) losses, net        (27)      (431)       (1,028)        4,004
Other income
 (expense), net          (3,580)    (3,498)         (619)        2,501
                      ---------- ---------- ------------- ------------

Income before share
 of equity in
 (earnings) loss of
 affiliate, minority
 interest and income
 tax expense               6,994     16,083        24,932       33,599

Equity in loss of
 affiliate                    73          7            61          114

Minority interest            904      2,788         2,062        2,633

Income tax expense
 (benefit)                 4,169      6,195         6,486        (307)
                      ---------- ---------- ------------- ------------
Net Income            $    1,848 $    7,093 $      16,323 $     31,159
                      ========== ========== ============= ============




                 Genpact Limited and its Subsidiaries
                              (Table K)

                   Allocation of Reclassified Items
                             (Unaudited)
                (In thousands, except per share data)

                                         Quarter Ended
                         ---------------------------------------------
                         March 31, June 30, September 30, December 31,
                            2007     2007       2007          2007
                         --------- -------- ------------- ------------

Foreign exchange (gains)
 losses, net as reported
 on historical basis       (1,660) (11,478)      (15,476)     (14,963)
----------------------------------------------------------------------

Allocation of
 reclassified items:
  Increase (decrease) in
   net revenue                 178      194           207         (92)
  Decrease in cost of
   revenue                   1,027    7,804        10,427       13,267
  Decrease in selling,
   general and
   administrative
   expenses                    428    3,049         3,814        5,792
----------------------------------------------------------------------
  Total                      1,633   11,047        14,448       18,967

----------------------------------------------------------------------
  Foreign exchange
   (gains) losses, net
   as reported on
   reclassified basis
   (1)                        (27)    (431)       (1,028)        4,004



(1)  Reclassified below income from operations.




                                                    Reclassified Basis
----------------------------------------------------------------------

          Reconciliation of Adjusted Income from Operations
                              (Table L)
                             (Unaudited)
                (In thousands, except per share data)

                                         Quarter Ended
                         ---------------------------------------------
                         March 31, June 30, September 30, December 31,
                            2007     2007       2007          2007
                         --------- -------- ------------- ------------

Income from operations
 as per GAAP             $  10,547 $ 19,150 $      24,523 $     35,102
  Add: Amortization of
   acquired intangible
   assets resulting from
   Formation Accounting      9,234    9,281         8,654        8,595
  Add: Additional
   depreciation due to
   fair value adjustment
   resulting from
   Formation Accounting        514      514           514          514
  Add: Share based
   compensation              1,935    3,296         3,678        4,112
  Add: FBT impact on
   share based
   compensation
   recovered from
   employees                    --       --            --          507
  Add: Gain (loss) on
   interest rate swaps        (35)       15         (189)        (131)
  Add: Other income            276      434           620        1,352
  Less: Equity in loss
   of affiliate               (73)      (7)          (61)        (114)
  Less: Minority
   interest                  (904)  (2,788)       (2,062)      (2,633)
                         --------- -------- ------------- ------------
Adjusted income from
 operations              $  21,494 $ 29,895 $      35,677 $     47,304
                         ========= ======== ============= ============



                                                      Historical Basis
----------------------------------------------------------------------

                 Genpact Limited and its Subsidiaries
                              (Table M)

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)

                                         Quarter ended
                         March 31,   June 30,  September  December 31,
                            2006       2006     30, 2006      2006
                         ---------- ---------- ---------- ------------
Net revenues
  Net revenues from
   services --
   significant
   shareholder           $  109,650 $  109,662 $  111,047  $   122,946
  Net revenues from
   services -- others        22,246     31,294     50,853       53,889
  Other revenues                 --         --        486          974
                         ---------- ---------- ---------- ------------
   Total net revenues       131,896    140,956    162,386      177,809
                         ---------- ---------- ---------- ------------
Cost of revenue
  Services                   77,986     85,753     93,148      102,904
  Others                         --         --        363          727
                         ---------- ---------- ---------- ------------
   Total cost of revenue     77,986     85,753     93,511      103,631
                         ---------- ---------- ---------- ------------
Gross profit                 53,910     55,203     68,875       74,178

Operating expenses:
  Selling, general and
   administrative
   expenses                  36,104     37,025     40,813       45,261
  Amortization of
   acquired intangible
   assets                    11,045     10,569     10,200        9,901
  Foreign exchange
   (gains) losses, net        3,695        826      4,235        4,265
  Other operating income    (1,128)      (625)    (1,373)      (1,804)
                         ---------- ---------- ---------- ------------
Income from operations   $    4,194 $    7,408 $   15,000  $    16,555

Other income (expense),
 net                          (554)    (2,630)    (4,230)      (1,821)
                         ---------- ---------- ---------- ------------

Income before share of
 equity in (earnings)
 loss of affiliate,
 minority interest and
 income taxes                 3,640      4,778     10,770       14,734

Equity in loss of
 affiliate                       --         --         --           --

Minority interest                --         --         --           --

Income tax expense
 (benefit)                  (1,428)    (2,244)    (2,035)        (143)
                         ---------- ---------- ---------- ------------
Net Income               $    5,068 $    7,022 $   12,805  $    14,877
                         ========== ========== ========== ============



                                                    Reclassified Basis
----------------------------------------------------------------------
                 Genpact Limited and its Subsidiaries
                              (Table N)

                  Consolidated Statements of Income
                             (Unaudited)
                (In thousands, except per share data)

                                      Quarter ended
                    March 31,               September 30, December 31,
                      2006    June 30, 2006     2006          2006
                    --------- ------------- ------------- ------------
Net revenues
  Net revenues from
   services --
   significant
   shareholder      $ 109,650 $     109,662 $     111,047 $    122,946
  Net revenues from
   services --
   others              22,246        31,294        50,853       53,889
  Other revenues           --            --           486          974
                    --------- ------------- ------------- ------------
    Total net
     revenues         131,896       140,956       162,386      177,809
                    --------- ------------- ------------- ------------
Cost of revenue
  Services             78,667        88,496        96,505      104,420
  Others                   --            --           363          727
                    --------- ------------- ------------- ------------
    Total cost of
     revenue           78,667        88,496        96,868      105,147
                    --------- ------------- ------------- ------------
Gross profit           53,229        52,460        65,518       72,662

Operating expenses:
  Selling, general
   and
   administrative
   expenses            36,344        37,990        41,996       45,689
  Amortization of
   acquired
   intangible
   assets              11,045        10,569        10,200        9,901
  Other operating
   income             (1,128)         (625)       (1,373)      (1,804)
                    --------- ------------- ------------- ------------
Income from
 operations         $   6,968 $       4,526 $      14,695 $     18,876

Foreign exchange
 (gains) losses,
 net                    2,774       (2,882)         (305)        2,321
Other income
 (expense), net         (554)       (2,630)       (4,230)      (1,821)
                    --------- ------------- ------------- ------------

Income before share
 of equity in
 (earnings) loss of
 affiliate,
 minority interest
 and income tax
 expense                3,640         4,778        10,770       14,734

Equity in loss of
 affiliate                 --            --            --           --

Minority interest          --            --            --           --

Income taxes
 expense (benefit)    (1,428)       (2,244)       (2,035)        (143)
                    --------- ------------- ------------- ------------
Net Income          $   5,068 $       7,022 $      12,805 $     14,877
                    ========= ============= ============= ============



                 Genpact Limited and its Subsidiaries
                              (Table O)

                   Allocation of Reclassified Items
                             (Unaudited)
                (In thousands, except per share data)

                                          Quarter ended
                           March 31,  June 30,  September 30, December
                              2006      2006        2006      31, 2006
                           ---------- --------- ------------- --------

Foreign exchange (gains)
 losses, net as reported
 on historical basis            3,695       826         4,235    4,265
----------------------------------------------------------------------

Allocation of reclassified
 items:

  Increase in cost of
   revenue                        681     2,743         3,357    1,516
  Increase in selling,
   general and
   administrative expenses        240       965         1,183      428
----------------------------------------------------------------------
  Total                           921     3,708         4,540    1,943

----------------------------------------------------------------------
  Foreign exchange (gains)
   losses, net as reported
   on reclassified basis
   (1)                          2,774   (2,882)         (305)    2,321



(1)  Reclassified below income from operations.



                                                    Reclassified Basis
----------------------------------------------------------------------
          Reconciliation of Adjusted Income from Operations
                              (Table P)

                             (Unaudited)
                            (In thousands)


                                   Quarter Ended,
                                            September 30, December 31,
               March 31, 2006 June 30, 2006     2006          2006
               -------------- ------------- ------------- ------------

Income from
 operations as
 per GAAP
 (reclassified
 basis)        $        6,968 $       4,526 $      14,695 $     18,876
 Add:
  Amortization
  of acquired
  intangible
  assets
  resulting
  from
  Formation
  Accounting           11,400        10,909        10,439        9,990
 Add:
  Additional
  depreciation
  due to fair
  value
  adjustment
  resulting
  from
  Formation
  Accounting              514           514           514          514
 Add: Stock
  based
  compensation          1,172         1,307         1,105          917
 Add: FBT
  Impact on
  Stock based
  compensation
  recovered
  from
  employees                --            --            --           --
 Add: Gain /
  (loss) on
  interest
  rate swaps            1,171         1,584       (1,311)         (50)
 Add: Other
  income                  312           771            85          156
 Less: Equity
  in loss of
  affiliate                --            --            --           --
 Less:
  Minority
  interest                 --            --            --           --
               -------------- ------------- ------------- ------------
Adjusted
 income from
 operations    $       21,537 $      19,611 $      25,527 $     30,403
               ============== ============= ============= ============

SOURCE: Genpact Limited

Genpact Limited
Investors:
Roanak Desai
+91 (124) 402-2716
roanak.desai@genpact.com
or
Media:
Anita Trehan
+91 (124) 402 2726
anita.trehan@genpact.com