Infosys Technologies Ltd posted a net profit of Rs.46.6 billion for the fiscal year 2007-08, registering year-on-year (YoY) growth of 21 percent over the previous fiscal (2006-07) under the Indian accounting system.
In a notification to the stock exchanges Tuesday, the Indian IT bellwether said its consolidated revenue for the entire fiscal grew by 20 percent YoY to Rs.167 billion from Rs.139 billion from the previous fiscal under the Indian accounting practice.
Net income for the fiscal under the American accounting practice grew by 36 percent YoY to $1.16 billion from $850 million a year ago.
Similarly, total revenue grew by 35 percent YoY to $4.18 billion from $3.09 billion during the same period.
Infosys Press Release says,
Highlights
Consolidated results for the quarter ended March 31, 2008
-- Income was Rs. 4,542 crore for the quarter ended March 31, 2008; YoY growth was 20.4%
-- Net profit after tax* was Rs. 1,249 crore for the quarter ended March 31, 2008; YoY growth was 9.2%
-- Earnings per share* increased to Rs. 21.83 from Rs. 20.30 for the corresponding quarter in the previous year; YoY growth was 7.5%
Consolidated results for the year ended March 31, 2008
-- Income was Rs. 16,692 crore for the year ended March 31, 2008; YoY growth was 20.1%
-- Net profit after tax* before exceptional item was Rs. 4,659 crore for the year ended March 31, 2008; YoY growth was 20.8%
-- Earnings per share* before exceptional item increased to Rs. 81.53 from Rs. 69.11 in the previous year; YoY growth was 18.0%
* The net profit for the quarter and year ended March 31, 2008 includes a reversal of tax provisions amounting to Rs. 20 crore and Rs. 121 crore respectively (Rs. 125 crore for the quarter and year ended March 31,2007). Excluding this reversal, the earnings per share for the quarter and year ended March 31, 2008 would have been Rs. 21.47 and Rs. 79.39 resulting in a YoY growth of 18.6% and 18.7% respectively.
Others
-- 40 new clients were added during the quarter by Infosys and its subsidiaries
-- Gross addition of 5,947 employees (net 2,586) for the quarter and 33,177 employees (net 18,946) for the year by Infosys and its subsidiaries
-- 91,187 employees as on March 31, 2008 for Infosys and its subsidiaries
-- The Board of Directors recommended a final dividend of Rs. 7.25 per share (145% on par value of Rs. 5 per share) and a special dividend of Rs. 20 per share (400% on par value of Rs. 5 per share) for fiscal 2008.
-- The Company's current financial policy is to pay dividends up to 20% of net profits. The Board has decided to increase the dividend pay-out ratio to up to 30% of net profits effective fiscal 2009.
"Our Global Delivery Model, combined with our consulting and solution capabilities, provides a strong platform for customers seeking efficiencies in their IT spend," said S. Gopalakrishnan, CEO and Managing Director. "Thus, while there could be short-term challenges due to global economic uncertainties, we as a company see significant growth opportunities in the medium to long term."
Business outlook
The company's outlook (consolidated) for the quarter ending June 30, 2008 and the fiscal year ending March 31, 2009, under Indian GAAP and US GAAP, is as follows:
Outlook under Indian GAAP - consolidated
Quarter ending June 30, 2008**
-- Income is expected to be in the range of Rs. 4,570 crore and Rs. 4,582 crore; YoY growth of 21.1% - 21.4%
-- Earnings per share*** before exceptional item are expected to be Rs. 20.73; YoY growth of 15.2%
Fiscal year ending March 31, 2009**
-- Income is expected to be in the range of Rs. 19,894 crore and Rs. 20,214 crore; YoY growth of 19.2% - 21.1%
-- Earnings per share***before exceptional item are expected to be between Rs. 92.32 and Rs. 93.92; YoY growth of 16.3% - 18.3%
** Conversion 1 US$ = Rs. 40.02
*** Excluding tax reversal of Rs. 20 crore and Rs. 121 crore in quarter and year ended March 31, 2008 respectively
Outlook under US GAAP
Quarter ending June 30, 2008
-- Consolidated revenues are expected to be in the range of US$ 1,142 million and US$ 1,145 million; YoY growth of 23.1% - 23.4%
-- Consolidated earnings per American Depositary Share*** are expected to be US$ 0.52; YoY growth of 18.2%
Fiscal year ending March 31, 2009
-- Consolidated revenues are expected to be in the range of US$ 4.97 billion and US$ 5.05 billion; YoY growth of 19.0% - 21.0%
-- Consolidated earnings per American Depositary Share*** are expected to be between US$ 2.31 and US$ 2.35; YoY growth of 16.7% - 18.7%
*** Excluding tax reversal of US$ 5 million and US$ 30 million in quarter and year ended March 31, 2008 respectively
Dividend
The Board of Directors recommended a final dividend of Rs. 7.25 per share (145% on par value of Rs. 5 per share) for fiscal 2008 amounting to Rs. 415 crore. The Board also recommended a special dividend of Rs. 20 per share (400% on par value of Rs. 5 per share) amounting to Rs. 1,144 crore. Including the interim dividend of Rs. 6 per share (120% on par value of Rs. 5 per share) amounting to Rs. 343 crore, the total dividend recommended for the year is Rs. 33.25 per share (665% on par value of Rs. 5 per share) amounting to Rs. 1,902 crore.
Awards and Accolades
Customers and market influencers commended Infosys' service excellence and delivery efficiency. The Boeing Company awarded Infosys the inaugural Boeing Performance Excellence Award (BPEA). Cummins Inc. selected Infosys as a Global Preferred Vendor for Information Technology and Eastman Chemical awarded Infosys the Supplier Excellence Award for the second year running.
An independent research firm cited Infosys as a Leader in Oracle Implementation Services.
"Our Package Implementation services combined with strong consulting services provide greater differentiation in the marketplace," said Chandra Shekar Kakal, Member - Executive Council, Senior Vice President and Global Head - Enterprise Solutions. "We see greater growth opportunities as large customers roll out their product implementation strategies seeking timely and cost-competitive solutions."
Expansion of services and significant projects
Market leaders across industry verticals continued to leverage Infosys' solutions and services to transform their businesses and compete effectively in a dynamic business environment.
Leading manufacturers are partnering with Infosys to improve their competitiveness. A top carmaker is consolidating its contact centers with Infosys' expertise. A manufacturer of aerostructures is leveraging Infosys' engineering services. For a leading automotive supplier, Infosys is implementing a next-generation services business platform built on Siebel and Oracle Fusion technologies. Infosys is advising an automobile manufacturer to transform its end-customer experience by developing its contact center consolidation strategy.
A data storage supplier has sought Infosys' advice to redesign its website to improve brand awareness. A US agribusiness and food company has signed up Infosys for supply chain management, global trade management and procurement. An automotive equipment manufacturer has engaged Infosys to set up a distributed workflow management system to reduce operational costs.
A leading online community is leveraging Infosys' Web 2.0 expertise to redesign its website for improved effectiveness. A power equipment manufacturer is using Infosys' help to migrate its legacy data systems.
Infosys is performing multiple business capability improvement initiatives for a global services company. A leading public safety organization used Infosys' expertise for database consolidation and localization and an oil and gas industry leader has chosen Infosys as a strategic partner to meet its enterprise IT needs.
Growth in new markets was strong. In the Middle East, Infosys defined the IT strategy and roadmap for the smelter operations of an aluminum producer and defined and designed a world-class QA framework for the IT organization of a transit authority.
Infosys is delivering a complete set of IT Infrastructure managed services to a multi-brand retail leader in the US and helping a global logistics leader define its application landscape and create a roadmap for future IT programs.
"The pricing environment remained stable during the quarter," said S.D. Shibulal, Chief Operating Officer. "We continue to see greater growth opportunities in Europe. Our current utilization level provides us enough flexibility to grow faster."
New services
Infosys has responded to emerging market needs by introducing new, value-added services. Learning Services, a new service from Infosys, addresses business problems that require a focus on underlying organizational learning needs. Current solutions include managed knowledge transfer, process adoption and sustenance, global sales effectiveness as well as enabling corporate universities and learning organizations to meet the needs of a global talent pool.
Infosys is also creating offerings that will be made available to companies via the Enterprise Software as a Service (SaaS) model, where the business application will be created and owned by Infosys and hosted either at its premises or at the client's premises.
Infosys BPO
Infosys BPO continues to ride the growth momentum with two strategic client wins and global recognitions from analysts and media.
Infosys BPO's Knowledge Services Division is delivering business research around client strategy, competitive analysis and price tracking for a Fortune 500 chemicals manufacturer. Infosys BPO is enabling a subsidiary of a leading oilfield product and services company to enhance customer business productivity with error-free business reporting.
Infosys BPO's Finance and Accounting service capabilities have been rated in the 'Positive' category by a leading analyst. Its domain offerings for Communication Services Providers, expertise in the Knowledge Services and Human Resource Outsourcing processes have been recognized by Global Telecom, Dow Jones and HRE Online magazines.
Finacle®
Finacle® announced four new customer wins across Western Europe, Latin America and India.
During the quarter, Finacle® unveiled version 10 of the Finacle® Universal Banking Solution, built with an investment of over $ 60 million over the last three years and incorporating new offerings including Islamic banking, wealth management and mobile banking solutions.
Asian Banker announced Finacle®, along with its customer Federal Bank, as the winner of the 'Best Core Banking Project' award for 2007. Finacle® has won this award for the second consecutive year.
Process Innovation
During the quarter, Infosys applied for an aggregate of 10 patents in the US and India. With this, Infosys has filed an aggregate of 119 patent applications (pending) in both countries, and has been granted two patents by the United States Patent and Trademark Office.
Liquidity
Cash and cash equivalents, including investments in liquid mutual funds, as on March 31, 2008 was Rs. 8,307 crore (Rs. 6,008 as on March 31, 2007). During the quarter ended March 31, 2008, Infosys incurred capital expenditure of Rs. 431 crore (Rs. 644 crore for quarter ending March 31, 2007). Operating cash flows during the quarter ended March 31, 2008 were Rs. 717 crore (Rs. 1,080 crore for the quarter ended March 31, 2007).
"We crossed a significant milestone reaching US$ 1 billion in net profits during the year. We have also successfully maintained our margins during the year, despite an 11% appreciation in the rupee," said V. Balakrishnan, Chief Financial Officer. "Our special dividend payment is to celebrate the achievement of the US$ 1 billion net income milestone and is in line with our desire to balance the cash required in the business with that of enhancing returns to our shareholders."
Human Resources
"We hired 33,177 (gross) employees during fiscal 2008, which is the highest employee addition in any year," said T.V. Mohandas Pai, Member of the Board and Head - HRD and Education & Research. "We have invested substantially in capability building and in the HR system during the year. Our ability to train and invest in people gives us a unique competitive advantage. Our investment in people enables us to go up the value chain in a significant manner."
About the company
Infosys Technologies Ltd. (NASDAQ: INFY) defines, designs and delivers IT-enabled business solutions that help Global 2000 companies win in a Flat World. These solutions focus on providing strategic differentiation and operational superiority to clients. Infosys creates these solutions for its clients by leveraging its domain and business expertise along with a complete range of services. With Infosys, clients are assured of a transparent business partner, world-class processes, speed of execution and the power to stretch their IT budget by leveraging the Global Delivery Model that Infosys pioneered. Infosys has over 91,000 employees in over 40 offices worldwide. Infosys is part of the NASDAQ-100 Index. For more information, visit www.infosys.com
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