Sify Reports Revenues of $154.24 Million

CHENNAI, India, May 3, 2011 /PRNewswire-FirstCall/ -- Sify TechnologiesLimited, a leader in Enterprise Network and ITServices in India with global delivery capabilities and a pioneer in consumerinternet services, announced today its consolidated unaudited results underInternational Financial Reporting Standards for the fourth quarter offiscal year 2010-11 and Annual year ending March 31, 2011.

- Sify reported earnings of US $154.24 million for the year ended March31, 2011, about 2.6% higher than the previous year's earnings of US $ 150.28million.

- Growth was driven by earnings from Enterprise services which grew 6.31%over the previous year and the International services earnings, which werehigher by 29.9%.

The consumer business model is being

- The consumer business model is being by degree transformed into ascalable model. The realignment of the business has resulted in revenuesdropping by 37.7%

Mr. Raju Vegesna, Board Chairman and CEO & MD, said, "We are pleased topresent our annual financial performance for FY2010-11, anchored bysatisfactory growth in the Enterprise and International Segments. When wechanged course about four years back, directing our energies towards buildinga strong Enterprise business in the form of Networks and Data centers, andreducing our dependence on consumer markets, we re-cast the company into anEnterprise player and a scalable consumer player. Together, our ICTfocus has helped to differentiate the Company from the commoditization trendin the Data Telecom markets. Our significant investment in NOIDA Data Centerproject as as well our investments in EIG undersea cable and the landing-stationfor GBI undersea cable at Mumbai are all at an advanced stage of completionand will be on commercial mode in FY 2011-2012

Focussed player in managedservices

Our efforts have enabled us to become a focussed player in managedservices, with a strong delivery team and a suite of services that we wish totranspose on the global stage; the expertise and the best practises we havedeveloped over the years in India will now be the base to grow our Globalpractice. Having consolidated the Enterprise Business, we have now put in astrategy to scale up our consumer business, enlarging the segment to includeSMBs and SOHOs. Leveraging our Enterprise investments in providing Cloudcomputing infrastructure, we will deliver our consumer offerings through aretail cloud, serving SOHOs, SMBs and consumers, making the services morecost-effective and scalable. Our effort is to make the Consumer business selfsustaining and profitable.

I am as well happy to announce that our portal business sify.com, throughsmall innovative initiatives has done exceedingly so then to improve its ratingsand win several marquee clients. In the meantime the business has returnedoperating profits for the first time. This is truly a proud moment for us.

On the whole, our improved bottom line showing is the result of strongand disciplined business management and effective cost control.

I am glad to share that the Government of India has reiterated itscommitment to increase the broadband penetration in the country, issuing apolicy which will enable the creation of Broadband networks costing up to $13.2 Billion to facilitate high speed data services and e-governance acrossthe country through the creation of a national broadband network, targeted toreach 160 million broadband connections in India by 2014.

One of the most encouraging aspects of the policy is the proposal toclassify the proposed fibre-optic network as a national resource, and make itavailable with equal terms offered to all operators wishing to providebroadband services. This can create a more level playing field for Sify withthe other telecom players, and allow us to furthermore leverage our investmentsto deliver value-added services to clients across India. With ourinfrastructure comprising network spread over 650 cities, 4 level 3 datacenters in Mumbai, Chennai and Bangalore, and several Level 2 datacenters in smaller cities, the home-grown applications delivered on the cloudmodel and our international bandwidth capacity, Sify is ideally positioned tolead the growth of IT services in India.

The same time

At the same time, we have reoriented our business units to become moremarket-facing and agile, so we can better take advantage of these emerginggrowth opportunities in India. Sify's new organisational design comprises 3strong business units: Sify Enterprise Services, offering network and ITServices to domestic and international clients, Sify Commercial andConsumer Services, which is focused on the unequalled needs of the large consumerand SMB/SOHO segment, and Sify Software Services, offering cloud-basedApplications and e-learning services. The Company will operate in a Groupstructure with each SBU expected to be profitable on an independent basis andcontribute unparalleled value to the Company."

Mr. MP Vijay Kumar, Chief Financial Officer, said, "We have over the lastfew quarters focused substantially on effective cost management, workingcapital management and reduction in cost of our borrowings. We are happy torecord that for five straight quarters we have managed to contain ouroperating expenses within our operating cash flows by generating surplusesquarter afterwards quarter. We are evaluating alternative funding plans to reducecost of existing debt. In the meantime we are seeing an increase in gross marginson our Enterprise businesses more due to higher asset utilization, increasedsales of cloud and managed services and higher revenue productivity."

Financial Highlights Unaudited Consolidated income statement as per IFRS Selling, General and Administrative Expenses EBIDTA 6.10 2.93 Depreciation, Amortisation and impairment Net Finance Expenses Other Income 1.62 15.52 Share of Affiliates 1.98 2.04 Profit Earlier tax Income Tax/benefit - 1.83 Profit(Loss) for the year 0.60 Attributable to: Equity holders of the company 0.38 Non-controlling interests - 0.22 Unaudited Consolidated income statement as per IFRS Selling, General and Administrative Expenses EBIDTA 2.31 0.84 Depreciation, Amortisation and impairment Net Finance Expenses Other Income 0.30 0.66 Share of Affiliates 0.52 0.59 Profit Previously tax Income Tax/benefit - - Profit(Loss) for the year Attributable to: Equity holders of the company Non-controlling interests - - *includes exceptional one time income Business Highlights: Enterprise Business:

The International MPLS offering

- There has been good traction for the International MPLS offering. Newcontracts have been closed, existing contracts has been upgraded and strongalliances forged with three top market players to create competitive andstate-of-the-art networking solution.

- In the voice business, the business maintained its robust growth with a43% increase over previous year, contributed by ILD and Hubbing businesseswhere Sify holds 7-9% market share.

- The hubbing business has grown 30% in volume over last quarter with 6new carriers signed up in this quarter alone. Philippines and Mexico wereamong the new destinations added.

- The Enterprise Application Services saw an 8% increase in gross marginsover previous year on a slightly lower revenue base. Three new customers thatwere acquired afterwards its launch in January 2011 include a Super-Specialtyhospital, a white goods manufacturer and a leader in Stationery Products.

The Company today uses mobile-based learning approach

- The Company today uses mobile-based learning approach and AugmentedReality Solutions to build learning solutions. These initiatives have helpedus to engage more deeply with Novartis and Dell during also allowing us toexpand into the Chinese school education market and helping us win contractsin the retail and innovation segment.

- Among the awarded contracts, some of the notable "wins" were apan-India consumer retail chain, a leading Specialized Innovation trainingservices provider in the North American market and a Global DevelopmentAgency engaged in Population and allied activities.

Consumer services comprises of public internet access through cybercafesand private access through broadband-to-home using wireless research and asmall part by Retail voice. Consumer as well encompasses Sify Portals.

- Sify broadband service is available in over 200 towns and cities andcaters to more than 80,000 clients through 1400 franchisees.

Recognizing the significant opportunities from the continued growth ofthe Enterprise business in India, as so then as the new opportunities that willemerge for the government's Rural Broadband Infrastructure initiatives, Sifyhas reorganised the entire business line from the then and there financial year intothe following SBUs:

Sify Enterprise Services - Connectivity and Voice Services have nowbecome Network Services, during Data Center Hosting and Managed Services,along with System Integration, will become IT Services. They will serviceboth domestic and International customers from large corporate and mid-marketcustomers.

Sify Commercial and Consumer Services - The scope of the Consumerbusiness has now been expanded to include SOHOs and SMBs apart from thecybercafes, Portals and broadband-to-home services, offering Network, ITServices and applications through the Cloud.

Sify Software -The EAS vertical in the before Enterprise SBU along withe-learning vertical from the International Business have been merged tocreate the Sify Software Services. This business unit will offer applicationsthrough the Cloud, primarily targeted at enterprise and internationalcustomers.

The largest Managed Enterprise

Sify is among the largest Managed Enterprise and Consumer InternetServices companies in India, offering end-to-end solutions with acomprehensive range of products delivered over a common telecom data networkinfrastructure reaching more than 625 cities and towns in India.

A significant part of the company's revenue is derived from CorporateServices, which include corporate connectivity, network and communicationssolutions, security, network management services, enterprise applications andhosting. Sify is a recognized ISO 9001:2008 certified service provider fornetwork operations, data center operations and customer support, and forprovisioning of VPNs, Internet bandwidth, VoIP (Voice over Internet Protocol) solutions and integratedsecurity solutions, and ISO / IEC 20000 - 1:2005 certified for Internet DataCenter operations. Sify has as well established a formidable reputation in theemerging Cloud Computing market and is today regarded as a thought leader inthe domain. Sify has licenses to operate NLD and ILD(International Long Distance) services and offers VoIP (Voice over Internet Protocol) back haul to longdistance subscriber telephony services. The company is India's firstenterprise managed services provider to launch a Security Operations Center(SOC) to deliver managed security services. A host of blue chip clients useSify's corporate service offerings.

The specialized domains ofeLearning Services

Sify as well caters to global markets in the specialized domains ofeLearning Services and Remote Infrastructure Management Services. TheeLearning Services designs, develops and delivers state-of-the-art digitallearning solutions for non-profit, for-profit organizations and governmentalorganizations in the fields of Information innovation, engineering,environment, healthcare, education and finance. The Remote InfrastructureManagement Services provides dependable and economical solutions aroundmanaged services, hosting and monitoring.

Sify Software was established with the cumulative experience gained overthe last decade in infrastructure, Data center and connectivity business. Itaims to be a solutions company that provides applications and services toimprove business efficiencies of its current customers and prospect clientbases.

Consumer services include broadband home access and the ePort cyber cafechain across more than 200 cities and towns in India. Very recently, Sifyalso introduced a whole host of services for the retail consumer on theConsumer cloud platform, thereby becoming among the first to do so in India.Sify.com, the popular consumer portal, has channels on news, entertainment,finance, sports, games and shopping. Samachar.com is the popular portal aimedat non-resident Indians around the globe. The site's content is available in8 Indian languages, which include Hindi, Malayalam, Telugu, Kannada andTamil, Punjabi and Gujarati should the contingency arise to English.

For a discussion of the risks associated with Sify's business, please seethe discussion pursuant to this agreement the caption "Risk Factors" in the company's AnnualReport on Form 20-F for the year ended March 31, 2010, which has been filedwith the United States Securities and Exchange Commission and is available byaccessing the database maintained by the SEC at www.sec.gov and Sify's otherreports filed with the SEC.

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