BANGALORE, India, Jan. 10, 2015 /PRNewswire/ --
Q3 constant currency revenue growth of 2.6% QoQ; 7.9% YoY
Reported revenues at $ 2,218 million; growth of 0.8% QoQ; 5.6% YoY
Operating margins at 26.7%; increase of 60 bps QoQ; 170 bps YoY
Net profit at $ 522 million; growth of 2.2% QoQ; 12.7% YoY
Volume growth of 4.2% QoQ (best in 3 years); 11.0% YoY
FY 15 revenue guidance maintained 7%-9% at Sep 30th exchange rates
Financial Highlights
Consolidated results under International Financial Reporting Standards (IFRS) for the quarter ended December 31, 2014
Quarter ended December 31, 2014
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(Logo: http://photos.prnewswire.com/prnh/20130122/589162)
Other Highlights
"We are excited by several breakthrough results in Q3. Our "renew and new" strategy, is being received well by our clients and our ecosystem and we are already seeing its early adoption", said Dr. Vishal Sikka, CEO and Managing Director. "Based on our strong performance, we are intensifying our efforts to deepen employee engagement, client ecosystem and strengthen our foundation of education as we build a next-generation services company that innovates for consistent profitable growth."
"During the quarter, we saw broad-based volume growth, increased utilization and strong client additions", said U. B. Pravin Rao, Chief Operating Officer. "We have made 100% variable payout for Q3 and have seen a further decline in attrition as a result of multiple initiatives taken over the last few quarters."
"Our sequential revenue growth in Q3 was adversely impacted to the extent of 1.8% due to USD appreciation against other major currencies", said Rajiv Bansal, Chief Financial Officer. "We made required investments keeping in mind short-term priorities and long-term aspirations"
Business Highlights
Over this quarter, we have been actively planning and executing the elements required to realize our strategy of renewing the core and innovating into new frontiers, based on a culture of learning and creativity.
We are seeing strong traction and acceptance of our new strategy with clients, as we continue to invest in strategic partnerships, education and automation.
Innovation Fund
The company has expanded its innovation fund from the current $ 100 million to $ 500 million to support the creation of a global eco-system of strategic partners. The capital will be used to invest into young companies world-wide innovating in areas such as AI, Automation, Internet of Things, Collaboration and Design.
Awards and Recognition
Beyond Business
Infosys has pledged `254 crore ($ 40 million) for FY 15 towards Corporate Social Responsibility (CSR) which is primarily being carried out through the Infosys Foundation, its philanthropic arm. Infosys and its subsidiaries donated $ 10 million and $ 31 million to Infosys Foundation and to Spark-IT for the quarter and nine-months ended December 31, 2014, respectively.
The Infosys Foundation is engaged in several programs aimed at alleviating hunger, promoting education, improving health, assisting rural development, supporting arts and helping the destitute. Spark-IT is a three-month program launched by the Foundation, to enhance the skill levels of unemployed engineering graduates in the country. It has committed `20 crore ($ 3 million) for this program which will help train 3,000 graduates in the fiscal year 2015.
During the quarter, Infosys donated $ 2 million to the Institute for Advanced Study (IAS) to create the Infosys Fund that will be used to support visiting scientists and scholars advance their research at the world-renowned institute in Princeton, New Jersey. Through this fund, two scholars across the Institute's four Schools each year will receive support related to all aspects of the academic appointment and community life that are unique and fundamental aspects of the Institute for Advanced Study experience.
This quarter, Infosys expanded its Corporate Social Responsibility (CSR) activities in the Americas through its philanthropic arm, the Infosys foundation, USA. It will focus on making quality computer science education widely and easily accessible across communities in the Americas. The company also announced the appointment of Mrs. Sudha Murty, Mrs. Vandana Sikka and Mr. Sandeep Dadlani as the trustees of Infosys Foundation, USA. The initial outlay for Infosys Foundation, USA, will be $ 5 million per annum.
Management changes
The company announced that Mr. Parvatheesam Kanchinadham, Chief Risk & Compliance Officer and Company Secretary, will be leaving the company effective January 10, 2015. Mr. Parvatheesam has been with the company for the past 12 years and has contributed in multiple areas. The company thanks him for his contribution.
Mr. David Kennedy, General Counsel, will assume the role of Chief Compliance Officer. Mr. Manikantha A.G.S., will be the interim Company Secretary.
About Infosys Ltd
Infosys is a global leader in consulting, technology, outsourcing and next-generation services. We enable clients, in more than 50 countries, to stay a step ahead of emerging business trends and outperform the competition. We help them transform and thrive in a changing world by co-creating breakthrough solutions that combine strategic insights and execution excellence.
Visit www.infosys.com to see how Infosys (NYSE: INFY), with US$ 8.25 billion in annual revenues and 165,000+ employees, is helping enterprises renew themselves while also creating new avenues to generate value.
Safe Harbor
Certain statements in this press release concerning our future growth prospects are forward-looking statements regarding our future business expectations intended to qualify for the 'safe harbor' under the Private Securities Litigation Reform Act of 1995, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, fluctuations in foreign exchange rates, our ability to manage growth, intense competition in IT services including those factors which may affect our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, industry segment concentration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which Infosys has made strategic investments, withdrawal or expiration of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our Annual Report on Form 20-F for the fiscal year ended March 31, 2014 and our Forms 6- K for the quarters ended June 30, 2014 and September 30, 2014. These filings are available at www.sec.gov. Infosys may, from time to time, make additional written and oral forward-looking statements, including statements contained in the company's filings with the Securities and Exchange Commission and our reports to shareholders. In addition, please note that the date of this advertisement is January 9, 2015, and any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of this date. 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 unless it is required by law.
Infosys Limited and subsidiaries |
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Unaudited Condensed Consolidated Interim Balance Sheets as of |
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(Dollars in millions except equity share data) |
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December 31, 2014 |
March 31, 2014 |
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ASSETS |
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Current assets |
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Cash and cash equivalents |
5,080 |
4,331 |
Available-for-sale financial assets |
239 |
367 |
Investment in certificates of deposit |
- |
143 |
Trade receivables |
1,437 |
1,394 |
Unbilled revenue |
465 |
469 |
Prepayments and other current assets |
438 |
440 |
Derivative financial instruments |
5 |
36 |
Total current assets |
7,664 |
7,180 |
Non-current assets |
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Property, plant and equipment |
1,385 |
1,316 |
Goodwill |
330 |
360 |
Intangible assets |
45 |
57 |
Available-for-sale financial assets |
214 |
208 |
Deferred income tax assets |
99 |
110 |
Income tax assets |
253 |
254 |
Other non-current assets |
38 |
37 |
Total non-current assets |
2,364 |
2,342 |
Total assets |
10,028 |
9,522 |
LIABILITIES AND EQUITY |
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Current liabilities |
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Trade payables |
28 |
29 |
Derivative Financial Instruments |
5 |
- |
Current income tax liabilities |
421 |
365 |
Client deposits |
4 |
6 |
Unearned revenue |
139 |
110 |
Employee benefit obligations |
165 |
159 |
Provisions |
71 |
63 |
Other current liabilities |
962 |
792 |
Total current liabilities |
1,795 |
1,524 |
Non-current liabilities |
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Deferred income tax liabilities |
8 |
11 |
Other non-current liabilities |
10 |
54 |
Total liabilities |
1,813 |
1,589 |
Equity |
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Share capital- '5 ($0.16) par value 1,200,000,000 (600,000,000) equity shares authorized, issued and outstanding 1,142,805,132 (571,402,566), net of 5,667,200 (2,833,600) treasury shares as of December 31, 2014 (March 31, 2014), respectively |
109 |
64 |
Share premium |
659 |
704 |
Retained earnings |
9,592 |
8,892 |
Other components of equity |
(2,145) |
(1,727) |
Total equity attributable to equity holders of the company |
8,215 |
7,933 |
Non-controlling interests |
- |
- |
Total equity |
8,215 |
7,933 |
Total liabilities and equity |
10,028 |
9,522 |
Infosys Limited and subsidiaries |
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Unaudited Condensed Consolidated Interim Statements of Comprehensive Income |
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(Dollars in millions except share and per equity share data) |
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Three months |
Three months |
Nine months |
Nine months |
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Revenues |
2,218 |
2,100 |
6,552 |
6,157 |
Cost of sales |
1,360 |
1,341 |
4,057 |
3,974 |
Gross profit |
858 |
759 |
2,495 |
2,183 |
Operating expenses: |
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Selling and marketing expenses |
124 |
104 |
362 |
327 |
Administrative expenses |
142 |
129 |
430 |
411 |
Total operating expenses |
266 |
233 |
792 |
738 |
Operating profit |
592 |
526 |
1,703 |
1,445 |
Other income, net |
136 |
117 |
419 |
301 |
Profit before income taxes |
728 |
643 |
2,122 |
1,746 |
Income tax expense |
206 |
180 |
607 |
482 |
Net profit |
522 |
463 |
1,515 |
1,264 |
Other comprehensive income |
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Items that will not be reclassified to profit or loss: |
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Re-measurement of the net defined benefit liability/(asset) |
(2) |
4 |
(6) |
10 |
Items that may be reclassified subsequently to profit or loss: |
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Fair value changes on available-for-sale financial asset |
8 |
(10) |
16 |
(14) |
Exchange differences on translation of foreign operations |
(169) |
91 |
(428) |
(844) |
Total other comprehensive income, net of tax |
(163) |
85 |
(418) |
(848) |
Total comprehensive income |
359 |
548 |
1,097 |
416 |
Profit attributable to: |
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Owners of the company |
522 |
463 |
1,515 |
1,264 |
Non-controlling interests |
- |
- |
- |
- |
522 |
463 |
1,515 |
1,264 |
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Total comprehensive income attributable to: |
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Owners of the company |
359 |
548 |
1,097 |
416 |
Non-controlling interests |
- |
- |
- |
- |
359 |
548 |
1,097 |
416 |
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Earnings per equity share |
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Basic ($) |
0.46 |
0.41 |
1.33 |
1.11 |
Diluted ($) |
0.46 |
0.41 |
1.33 |
1.11 |
Weighted average equity shares used in computing earnings per equity share |
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Basic |
1,142,805,132 |
1,142,805,132 |
1,142,805,132 |
1,142,805,132 |
Diluted |
1,142,827,396 |
1,142,805,132 |
1,142,815,423 |
1,142,805,132 |
NOTE:
1. The unaudited Condensed Consolidated Interim Balance Sheets and Condensed Consolidated Interim Statements of Comprehensive Income for the three months and nine months ended December 31, 2014 have been taken on record at the Board meeting held on January 9, 2015
2. A Fact Sheet providing the operating metrics of the company can be downloaded from http://www.infosys.com.
IFRS-INR Press Release: http://multivu.prnewswire.com/prnehost/PIV724094InfosysIFRSINRPressRelease.pdf
Fact Sheet: http://multivu.prnewswire.com/prnehost/PIV724094InfosysFactSheet.pdf
Contact
Investor Relations
Sandeep Mahindroo
+91-80-3980-1018
Sandeep_Mahindroo@infosys.com
Media Relations
Sarah Vanita Gideon, India
+91-80-4156-3373
Sarah_Gideon@Infosys.com
John Gallagher
Brunswick Group for Infosys, USA
+1-415-316-8060
jgallagher@brunswickgroup.com