WATERLOO, Ont. - Descartes Systems Group (TSX:DSG) says its net income dropped by 90 per cent due to higher expenses as the company's revenue from its logistics information services and software increased by 22 per cent thanks largely to accusations.

Revenue for the three months ended April 30 was $21.3 million, up from $17.4 million in the first quarter of fiscal 2010.

The increased revenue included $2.6 million from Portus and Imanet. Without that, Descartes revenue would have been $18.7 million — up 7.4 per cent from a year earlier.

Net income before adjustments fell to $200,000 from $2.2 million a year earlier, when Descartes felt the positive impact of a tax recovery and several expense items were lower.

The latest quarter a $700,000 income tax expense that was in contrast with the $400,000 tax recovery in the comparable period of fiscal 2010.

The first quarter of fiscal 2011 also included $900,000 in acquisition-related expenses — compared with $300,000 a year earlier — as well as $600,000 in restructuring expenses, up from $400,000 in the first quarter of fiscal 2010.

Descartes said its adjusted net income, which is before the tax impact, was $5.3 million, up 13 per cent from $4.7 million a year ago.

"Our first quarter has historically been our most seasonally-challenging quarter and, this year, the challenges were heightened with severe currency fluctuations and the Icelandic volcanic activity that adversely impacted European air shipment volumes," said Stephanie Ratza, CFO at Descartes.

Descartes provides a global network for freight carriers. Services accounted for $20.1 million of revenue, up fro $16.8 million a year earlier and up from $17.7 million in the prior quarter.