Persistent systems

1QFY2012 Result Update | IT
July 18, 2011

Persistent Systems ACCUMULATE
CMP `373
Performance highlights Target Price `424
Y/E March (` cr) 1QFY12 4QFY11 % chg (qoq) 1QFY11 % chg (yoy) Investment Period 12 Months
Net revenue 224 213 5.2 181 23.6
EBITDA 40 38 5.3 34 16.6
Stock Info
EBITDA margin (%) 17.9 17.9 3bp 19.0 (108)bp
Sector IT
PAT 28 33 (16.8) 35 (20.2)
Market Cap (` cr) 1,490
Source: Company, Angel Research
Beta 0.7
For 1QFY2012, Persistent Systems (Persistent) reported numbers that were almost 52 Week High / Low 504/337
in-line with the expectations on the revenue front, though its performance was
Avg. Daily Volume 35,272
marginally disappointing on the operating front. Management has maintained its
Face Value (`) 10
revenue guidance of US$220mn, i.e. 29% yoy growth for FY2012, and is
confident of maintaining PAT at least flat yoy, despite the surge in tax rates to 31% BSE Sensex 18,507
from 7% in FY2011. The company is into pure-play offshore product development Nifty 5,567
(OPD) and has been recording a 6% CQGR since 1QFY2011 on the back of Reuters Code PERS.BO
comeback in R&D spending by product companies. We recommend Accumulate Bloomberg Code PSYS@IN
on the stock.
Quarterly highlights: For 1QFY2012, Persistent reported revenue of US$50.0mn,
Shareholding Pattern (%)
up 6.3% qoq, led by volume growth coupled with increased billing rates.
Promoters 38.9
In rupee terms, revenue came in at `223.8cr, up 5.2% qoq. Despite strong
volume growth, EBITDA margin remained stable qoq at 17.9% because of a MF / Banks / Indian Fls 25.1
decline in IP-led revenue as well as promotions given during the quarter. FII / NRIs / OCBs 6.5
PAT came in at `27.6cr, aided by higher forex gain of `6.4cr as against `2.9cr in Indian Public / Others 29.6
4QFY2011 on the back of ITM hedges of US$86.25mn with average contract rate
of 47.39INR/USD.
Abs. (%) 3m 1yr 3yr
Outlook and valuation: Persistent, due to its niche focus on OPD, is expected to
Sensex (3.1) 3.1 35.7
witness a scorching revenue CAGR of 26.3% (in USD) over FY2011–13E,
outperforming tier-I IT companies’ growth. Also, on the back of adequate margin Persistent (4.9) (23.2) -
Note: Listed on April 6, 2010
levers, the tailwinds mentioned above are expected to overplay the headwinds
such as 1) rupee appreciation and 2) competitive wage hikes in the medium term,
thereby helping the margins to rebound to 18.4% and 19.5% in FY2012 and
FY2013, respectively. At the CMP of `373, the stock is trading at 9.7x FY2013E
EPS of `38.5. We value the stock at 11x FY2013 EPS, i.e. 45% discount to Infosys,
and recommend an Accumulate rating on the stock with a target price of `424.

Key financials (Indian GAAP, Consolidated)
Y/E March (` cr) FY2010 FY2011 FY2012E FY2013E
Net sales 601 776 984 1,195
% chg 1.2 29.1 26.8 21.4
Net profit 115 140 137 154
% chg 74.0 21.5 (2.1) 12.7
EBITDA margin (%) 24.3 20.4 18.4 19.5
EPS (`) 32.1 34.9 34.2 38.5
Srishti Anand
P/E (x) 11.6 10.7 10.9 9.7 +91 22 39357800 Ext: 6820
P/BV (x) 2.1 2.0 1.7 1.5 srishti.anand@angelbroking.com
RoE (%) 18.0 18.7 15.8 15.4
RoCE (%) 17.5 15.5 14.6 16.6 Ankita Somani
EV/Sales (x) 1.9 1.5 1.2 0.9 +91 22 39357800 Ext: 6819
EV/EBITDA (x) 7.8 7.2 6.4 4.8 ankita.somani@angelbroking.com

Please refer to important disclosures at the end of this report 1

Persistent | 1QFY2012 Result Update

Exhibit 1: 1QFY2012 performance (Indian GAAP, Consolidated)
Y/E March (` cr) 1QFY12 4QFY11 % chg (qoq) 1QFY11 % chg (yoy) FY2011 FY2010 % chg (yoy)
Net revenue 224 213 5.2 181 23.6 776 601 29.1
Cost of revenue 140 133 5.3 112 25.0 472 337 40.1
Gross profit 83 80 4.8 69 21.3 304 264 15.0
S&M expenses 18 16 7.7 14 23.8 62 46 33.5
G&A expenses 26 25 2.3 20 27.5 83 71 17.1
EBITDA 40 38 5.3 34 16.6 158 146 8.2
Depreciation 13 12 6.0 10 29.6 42 34 26.4
EBIT 27 26 5.0 25 11.4 116 113 2.7
Other income 6 6 3 17 8
Forex gain/(loss) 6 3 9 17 3
PBT 40 35 14.9 37 7.9 150 124 21.2
Income tax 12 2 628.2 3 382.6 11 9 17.3
PAT 28 33 (16.8) 35 (20.2) 140 115 21.5
EPS 6.9 8.3 (16.8) 8.6 (19.8) 34.9 32.1 8.8
Gross margin (%) 37.3 37.4 (11)bp 38.0 (71)bp 39.1 43.9 (478)bp
EBITDA margin (%) 17.9 17.9 3bp 19.0 (108)bp 20.4 24.3 (394)bp
EBIT margin (%) 12.3 12.3 (2)bp 13.6 (134)bp 14.9 18.8 (383)bp
PAT margin (%) 11.7 15.0 (329)bp 17.8 (618)bp 17.2 18.8 (154)bp

Revenue momentum continues

For 1QFY2012, Persistent reported revenue of US$50.0mn, up 6.3% qoq,
primarily led by volume growth. Also, the company’s billing rates, onsite as well as
offshore, improved by 2.3% and 1.3% qoq to US$13,033 per person per month
(ppm) and US$3,770 ppm, respectively. The improvement in billing rates during
the quarter was due to selling of high-end services like technology consulting,
mobility and analytics.

In rupee terms, revenue came in `223.8cr, up 5.2% qoq – lower growth as against
dollar revenue due to 1.0% qoq INR appreciation against USD in 1QFY2012.

Exhibit 2: Trend in revenue growth (qoq)
55 10

8.8 9
50
50.0 8

45 47.0 7
(US$ mn)

6.7
6.3
6
(%)

5.8 43.2
40 5
40.5
39.5
4
35
3
2.6
30 2
1QFY11 2QFY11 3QFY11 4QFY11 1QFY12
Revenue (US$mn) qoq growth (%)


July 18, 2011 2


Exhibit 3: Trend in billing rates (qoq)
14,000 12,896 12,746 13,033
12,414 12,470
12,000

10,000

(US$/ppm)
8,000

6,000
3,600 3,601 3,661 3,723 3,770
4,000

2,000

-
Onsite Offshore


Industry wise, the company’s growth was led by the telecom and wireless segment
(contributing 22.2% to revenue), which grew by 15.1% qoq, majorly led by
European clients. The anchor industry segment – infrastructure and systems
(contributed 67.9% to revenue) – continued its revenue traction and grew by 5.7%
qoq. In absolute terms, revenue contribution from the lifesciences and healthcare
segment stood modest; however, on a qoq basis, revenue declined by 6.0% due to
base effect, as higher growth was reported in this segment in 2HFY2011.

Exhibit 4: Growth trend in industry segments
% to revenue % chg (qoq) % chg (yoy)
Infrastructure and systems 67.9 5.7 19.9
Telecom and wireless 22.2 15.1 51.9
Lifesciences and healthcare 9.9 (6.0) 27.9

Geography wise, growth was led by Europe, revenue from which grew by 35.7%
qoq – whopping growth due to low base effect and ramp-up in revenue from few
European clients. North America continued to grow during this quarter as well
at 2.0% qoq.

Exhibit 5: Growth trend in geographies
% to revenue % chg (qoq) % chg (yoy)
North America 82.8 2.0 23.2
Europe 7.4 35.7 44.1
Asia-Pacific 9.8 31.9 47.7

Revenue contribution from IP-led services declined in 1QFY2012 to 6.1% from
10.3% in 4QFY2012 because of lower revenue from the company’s top customer
that contributes almost 60% to the company’s IP-led revenue. Management has
indicated that it is a one-time issue and revenue from the top customer is expected
to scale up again in the coming quarters. IP-led revenue seems low also because
of higher base in 4QFY2011, which was due to higher product sale from the top
customer’s end in 3QFY2011, the royalty revenue of which got reflected in

July 18, 2011 3


Persistent’s account in 4QFY2011. The company expects IP-led revenue to touch
US$25mn by the end of FY2012, i.e. whopping 68% yoy growth.

Hiring and utilisation

Persistent continued its modest hiring trend and added 260 net employees during
the quarter. Gross addition during the quarter was 545. In the technical employee
base of the company, 228 net employees were added. Attrition rate (LTM basis)
declined significantly in 1QFY2012 to 18.4% from 19.6% in 4QFY2011, as the
company gave wage hikes in 4QFY2011 to control attrition and, as a result,
quarterly attrition rate in 1QFY2012 stood merely at 3.2% (quarterly annualised at
12.8%), leading to an overall decline in attrition rates on an LTM basis.

Exhibit 6: Employee metrics
Particulars 1QFY11 2QFY11 3QFY11 4QFY11 1QFY12
Technical 4,554 4,907 5,070 5,950 6,178
Sales 79 87 94 108 119
Rest 278 287 296 302 323
Total 4,911 5,281 5,460 6,360 6,620
Net addition 249 370 179 900 260
Attrition – LTM (%) 16.3 18.6 21.5 19.6 18.4

For FY2012, management has a gross hiring target of 2,300 employees (1,000
freshers and 1,200–1,300 laterals) and a net hiring target of ~1,500 employees.

Net utilisation (excluding resources in IP-led work) increased by 170bp qoq to
72.7%. However, in 2QFY2012, we expect utilisation to dip due to intake of
freshers into the system. Management expects utilisation to inch up and reach
75–77% over the next 3–4 quarters.

Exhibit 7: Utilisation trend
80
78.5

78

76
74.2
(%)

74 72.7
71.7
72 71.0

70

68

Utilisation (%)


July 18, 2011 4


Margin profile

In 1QFY2012, the company’s EBITDA and EBIT margins remained almost stable
qoq at 17.9% and 12.3%, respectively, despite higher revenue growth due to
higher costs incurred on account of promotions given in 1QFY2012 and drop in
IP-led revenue.

Going ahead, for 2QFY2012, the company has announced wage hikes — 7–8%
for offshore employees and 4% for onsite employees, effective from July 1, 2011.
This is expected to negatively affect the company’s operating margins by
200–220bp qoq in the next quarter. However, for the full year, the company
expects margins to remain stable at FY2011 levels.

Exhibit 8: Margin profile
45
40
42.2
35 38.0 39.1
37.4 37.3
30
23.0 21.9
25
(%)

19.0 17.9 17.9
20
15 17.6 16.5
10 13.6
12.3 12.3
5

Gross margin EBITDA margin EBIT margin


Client pyramid

The client metrics of the company saw a qualitative movement with six new clients
in the US$1mn–3mn revenue bracket. Also, four clients were added in the
<US$1mn revenue bracket.

In 1QFY2012, Persistent added 32 new clients, out of which eight were from the
company’s partners. The total active client base of the company increased to 239
from 229 in 4QFY2011.

Exhibit 9: Client metrics
Particulars 1QFY11 2QFY11 3QFY11 4QFY11 1QFY12
Customers billed 196 201 207 229 239
<US$1mn 165 171 169 194 198
US$1mn-3mn 22 21 29 26 32
>US$3mn 9 9 9 9 9

July 18, 2011 5


Investment rationale
Established footprint in the resurging OPD market

Persistent has a dominant market share of ~16% (in CY2010) in the Indian OPD
market. The company is witnessing a robust uptick in the deal pipeline as clients
are flocking to generate new products in shorter time to market to capture market
share. This is driving many ISVs and wireless equipment manufacturers to spend
on R&D and engineering services. As per IDC, out of the global size of US$40bn in
2010 for R&D and product engineering, the Indian OPD market is just
worth ~US$1bn. The global OPD market is expected to grow at a 14% CAGR to
US$65.7bn by 2014. The offshore segment of the global OPD market in
2010 crossed the US$10bn mark and is expected to grow at a 19% CAGR to
US$16bn by 2014.

Exhibit 10: Worldwide R&D/PES spending (US$ mn)
70,000 25

60,000 18.2 19.1 20
17.9 16.3
50,000 13.2 15
(US$ mn)

(%)
9.7 10.2
40,000 10

30,000 5
3.9

20,000 0
CY2006 CY2007 CY2008 CY2009 CY2010 CY2011 CY2012 CY2013

IT spending (US$ mn) yoy growth (%)

Source: IDC, Angel Research

Exhibit 11: Worldwide R&D/PES offshore spending (US$ mn)
18,000 23.5 25
21.7
16,000 19.4
20
14,000 17.9
15
(US$ mn)

12,000 11.8
(%)

9.7
10,000 10
8,000
5
6,000 3.9
3.8
4,000 0
CY2006 CY2007 CY2008 CY2009 CY2010 CY2011 CY2012 CY2013

IT spending (US$ mn) yoy growth (%)

Source: IDC, Angel Research

July 18, 2011 6


Non-linear services already a sizeable part of the portfolio

Persistent has a sizeable portfolio coming in from IP-led revenue, which was ~9%
in FY2011. The company expects it to scale up to ~11% in FY2012 and reach
~20% by FY2015. The company has been investing in the areas of 1) cloud,
2) analytics, 3) collaboration and 4) mobility, which are towards consulting. With
the expected increase in contribution from IP revenue, the company is likely to
benefit at the margin front because of its non-linear nature.

Exhibit 12: IP-led revenue as a % of total revenue
12 11.4
11
10.2
10
8.8
9
8
(%)

7.2
7
6 5.2
5
4
FY2009 FY2010 FY2011 FY2012E FY2013E
IP driven revenue (as % of sales)


Marquee clientele

Out of its active clients, 37 have revenue of more than US$1bn and dedicated
annual R&D budgets of 6–20% of revenue to drive product innovation.
The company has marquee clients (with R&D budgets) including MNCs like IBM
(~6.0%), Google (~12.8%), Microsoft (~13.9%), Oracle (~12.8%), Intel
(~15.1%), Cisco (~13.2%), Nokia (~14%), Samsung, Yahoo (~17%) and eBay.
In addition, the company’s client mining is strong as the company manages to get
~11% of its revenue from new clients vis-à-vis peers who get mere 3–5%.

Exhibit 13: Revenue (CY2010/FY2010) and R&D budget as a % of sales
120
99.9
100

80
62.5
60
43.6 40.0
40 29.3

20 13.9 15.1 13.2 13.8 12.8
12.5 6.0
0
Microsoft Intel Cisco SAP Google IBM
Revenue (US$ mn) R&D as % of sales


July 18, 2011 7


Robust revenue growth with gradual improvement in margins

Persistent is expected to report a robust revenue CAGR of 26.3% over FY2011–13E
on the back of return in demand for OPD services. In fact the company has
indicated net hiring to be 1,500 plus for FY2012E on the back of a strong deal
pipeline. On the operating front, we expect margins to rebound in 2HFY2012 from
17.9% in 1QFY2012 to 18.4% in FY2012 and 19.5% in FY2013. We expect this
margin improvement because of margin levers such as 1) employee pyramid
rationalisation (indicated to hire 700 freshers out of 1,500 net people in FY2012);
2) higher revenue productivity due to the expected increase in IP-led revenue
contribution; 3) gradual increase in utilisations to 74.7% in FY2013 from 72% in
1QFY2012 and 4) stable G&A in absolute terms even with higher growth.
On the PAT front, we expect factors like 1) improvement in profitability and 2) forex
gains due to In-the-Money (with average contract rate of 47.39INR/USD) hedges
worth US$86.25mn to counter the headwinds due to higher tax rate of 31%
compared to 7% in FY2011.

Exhibit 14: Revenue expectations
300

250 28.8% 271.7
CAGR

200 221.4
(US$ mn)

150 170.2

127.9 127.3
100

50
FY2009 FY2010 FY2011 FY2012E FY2013E

Revenue (US$ mn)


Exhibit 15: Margin expectations
31 30.1

29

27
24.3
25
(%)

23
20.4
21 19.5
18.4
19

17
FY2009 FY2010 FY2011 FY2012E FY2013E

EBITDA margin (%)


July 18, 2011 8


Outlook and valuation

Persistent, due to its niche focus on OPD, is expected to record a scorching
revenue CAGR of 26.3% (in USD) over FY2011–13E, outperforming tier-I IT
companies’ growth. Also, on the back of adequate margin levers, the tailwinds
mentioned above are expected to overplay the headwinds such as 1) rupee
appreciation and 2) competitive wage hikes in the medium term and help the
margins to rebound to 18.4% and 19.5% in FY2012 and FY2013, respectively.
At the CMP of `373, the stock is trading at 9.7x FY2013E EPS of `38.5. We value
the stock at 11x FY2013 EPS, i.e. 45% discount to Infosys, and recommend an
Accumulate rating on the stock with a target price of `424.

Exhibit 16: Key assumptions
FY2012 FY2013
Revenue growth – USD terms (%) 30.1 22.7
USD-INR rate 44.5 44.0
Revenue growth – INR terms (%) 26.8 21.4
EBITDA margin (%) 18.4 19.5
Tax rate (%) 31.0 31.0
EPS growth (%) (2.0) 12.7

Exhibit 17: One-year forward PE(x) chart
700

600

500
(` )

400

300

200
Dec-10
Apr-10

Jul-10

Aug-10

Apr-11

Jul-11
Mar-11
Oct-10
Sep-10

Nov-10

Feb-11
May-10

May-11
Jun-10

Jun-11
Jan-11

Price 16 14 12 10 8


July 18, 2011 9


Exhibit 18: Recommendation summary
Company Reco CMP Tgt. price Upside FY2013E FY2013E FY2011-13E FY2013E FY2013E
(`) (`) (%) P/BV (x) P/E (x) EPS CAGR (%) RoCE (%) RoE (%)
3iInfotech Neutral 44 - - 0.6 3.8 (4.3) 12.0 15.1
Educomp Buy 387 522 34.8 1.3 7.5 17.7 16.4 17.0
Everonn Accumulate 539 602 11.7 2.6 12.8 27.7 15.5 16.7
HCL Tech Buy 504 591 17.3 3.2 11.9 30.8 18.9 26.9
Infosys Buy 2,714 3,200 17.9 3.9 17.0 15.7 24.7 22.7
Infotech Enterprises Neutral 138 - - 1.1 8.6 13.0 15.0 13.2
KPIT Cummins Accumulate 182 208 14.3 1.7 10.8 21.9 21.8 17.7
Mphasis Accumulate 436 499 14.4 1.6 9.8 9.2 16.8 16.8
NIIT Buy 55 68 24.3 1.3 7.9 10.9 12.4 16.6
Persistent Accumulate 373 424 13.8 1.5 9.7 5.1 16.6 15.4
TCS Buy 1,125 1,368 21.6 5.7 18.1 18.4 30.2 31.3
Tech Mahindra Accumulate 741 790 6.6 2.1 13.1 6.8 14.9 15.6
Wipro Buy 413 483 17.0 3.1 14.5 14.5 16.3 21.5

July 18, 2011 10


Profit and loss statement (Indian GAAP, Consolidated)
Net sales 601 776 984 1,195
Direct costs 337 472 626 759
% of net sales 56.1 60.9 63.6 63.5
Gross profit 264 304 358 436
% of net sales 43.9 39.1 36.4 36.5
S&M expenses 46 62 78 95
% of net sales 7.7 8.0 8.0 8.0
G&A expenses 71 83 98 108
% of net sales 11.9 10.8 10.0 9.0
EBITDA 146 158 181 233
% of net sales 24.3 20.4 18.4 19.5
Depreciation 34 42 54 66
EBIT 113 116 127 168
Other income 8 17 45 42
Forex gain/(loss) 3 17 26 14
Profit before tax 124 150 198 224
Provision for tax 9 11 62 69
% of PBT 7.3 7.1 31.0 31.0
PAT 115 140 137 154
Extraordinary expenses - - - -
Final PAT 115 140 137 154
EPS (`) 32.1 34.9 34.2 38.5

July 18, 2011 11


Balance sheet (Indian GAAP, Consolidated)
Liabilities
Share capital 40 40 40 40
ESOP outstanding 3 3 4 4
Reserves and surplus 580 696 816 954
Hedge reserves 16 8 7 7
Total shareholders' funds 639 747 867 1,005
Deferred payment liability 5 3 3 3
Total liabilities 644 750 870 1,008
Assets
Gross block - fixed assets 371 454 654 804
Accumulated depreciation 188 228 282 348
Net block 183 226 372 456
Capital work-in-progress 48 60 67 59
Total fixed assets 232 287 439 515
Investments 156 250 250 250
Deferred tax assets, net 1 6 6 -
Current assets
Sundry debtors 136 158 183 223
Cash and bank balance 192 100 75 128
Other current assets 34 23 25 30
Loans and advances 72 87 110 131
Less: - Current liab. and provisions
Current liabilities 148 121 172 208
Provisions 32 40 47 62
Net current assets 255 207 174 242
Total assets 644 750 870 1,008

July 18, 2011 12


Cash flow statement (Indian GAAP, Consolidated)
Pre tax profit from operations 113 116 127 168
Depreciation 34 42 54 66
Pre tax cash from operations 146 158 181 233
Other income/prior period ad 11 34 71 56
Net cash from operations 158 193 253 289
Tax 9 11 62 69
Cash profits 149 182 191 220
(Inc)/dec in
Current assets (81) (25) (51) (65)
Current liabilities 88 (19) 59 51
Net trade working capital 7 (44) 8 (14)
Cashflow from operating activities 156 138 199 206
(Inc)/dec in fixed assets (48) (97) (207) (142)
(Inc)/dec in investments (68) (94) 0 -
(Inc)/dec in deferred tax assets 1 (5) (0) 6
Inc/(dec) in deferred payment liab. 5 (2) (0) -
Cashflow from investing activities (110) (198) (207) (136)
Inc/(dec) in debt - - - -
Inc/(dec) in equity/premium 132 (6) (1) -
Dividends (2) (26) (16) (16)
Cashflow from financing activities 129 (32) (17) (16)
Cash generated/(utilised) 175 (92) (25) 54
Cash at start of the year 17 192 100 75
Cash at end of the year 192 100 75 128

July 18, 2011 13


Key ratios
Y/E March FY2010 FY2011 FY2012E FY2013E
Valuation ratio (x)
P/E (on FDEPS) 11.6 10.7 10.9 9.7
P/CEPS 9.0 8.2 7.8 6.8
P/BVPS 2.1 2.0 1.7 1.5
Dividend yield (%) 0.1 1.5 0.9 0.9
EV/Sales 1.9 1.5 1.2 0.9
EV/EBITDA 7.8 7.2 6.4 4.8
EV/Total assets 1.8 1.5 1.3 1.1
Per share data (`)
EPS 32.1 34.9 34.2 38.5
Cash EPS 41.4 45.5 47.8 55.0
Dividend 0.6 5.5 3.5 3.5
Book value 178.1 186.8 216.7 251.1
Dupont analysis
Tax retention ratio (PAT/PBT) 0.9 0.9 0.7 0.7
Cost of debt (PBT/EBIT) 1.1 1.3 1.6 1.3
EBIT margin (EBIT/Sales) 0.2 0.1 0.1 0.1
Asset turnover ratio (Sales/Assets) 0.9 1.0 1.1 1.2
Leverage ratio (Assets/Equity) 1.0 1.0 1.0 1.0
Operating ROE 18.0 18.7 15.8 15.4
Return ratios (%)
RoCE (pre-tax) 17.5 15.5 14.6 16.6
Angel RoIC 45.7 34.1 26.6 29.4
RoE 18.0 18.7 15.8 15.4
Turnover ratios (x)
Asset turnover (fixed assets) 2.7 3.0 2.7 2.5
Receivables days 73 69 68 68
Payable days 120 104 100 100

July 18, 2011 14


Research Team Tel: 022 - 3935 7800 E-mail: research@angelbroking.com Website: www.angelbroking.com

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Disclosure of Interest Statement Persistent
1. Analyst ownership of the stock No
2. Angel and its Group companies ownership of the stock No
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4. Broking relationship with company covered No

Note: We have not considered any Exposure below `1 lakh for Angel, its Group companies and Directors

Ratings (Returns): Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)
Reduce (-5% to 15%) Sell (< -15%)

July 18, 2011 15

Persistent systems

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Persistent systems