Bangalore, Apr 15 (PTI) IT services giant Infosys today
reported a 25 per cent jump in its consolidated net profit for
the quarter ended March 31, 2014, helped by large deals and an
uptick in client spending.
The Bangalore-based firm posted a consolidated net profit
at Rs 2,992 crore for the fourth quarter of last fiscal from
Rs 2,394 crore in the year-ago period.
Revenue for the reported quarter rose 23.2 per cent to Rs
12,875 crore from Rs 10,454 crore.
However, the country's second largest software services
exporter said it expects its US dollar revenues to be in the
range of 7-9 per cent for the 2014-15 fiscal, which is way
below industry body Nasscom's projection of 13-15 per cent.
Even in rupee terms, the firm gave a revenue guidance of
5.6-7.6 per cent for the current financial year.
Reacting to the results, Infosys opened the day on a
positive note and gained 4 per cent to Rs 3,371.80 at the BSE.
However, by 11:30 AM the scrips lost their initial gains and
were trading at Rs 3,286.40 apiece, up by 1.50 per cent.
Commenting on the guidance, Infosys CEO and Managing
Director S D Shibulal said: "As we have said in the past, our
guidance is a statement of fact. We are coming out from a low
momentum quarter, Q4 as well as Q3.
"We have said that some of the challenges that we faced
in Q3 and Q4 will continue to be there during the coming year.
We have factored in all those things when we have given a
guidance of 7-9 per cent. Thats how we see things today."
He added that the firm has been able to double its growth
rate for the full year (2013-14) compared to last year, while
stating that performance in Q4 FY 2014 has been disappointing.
In US dollar terms, Infosys' profit grew 9.7 per cent to
USD 487 million in January-March quarter of 2013-14 fiscal,
while revenue rose by 7.9 per cent to USD 2.09 billion.
For FY 2014, net profit grew 1.5 per cent to USD 1.75
billion, while revenue was up 11.5 per cent to USD 8.2 billion
over 2012-13 financial year.
Sequentially, Infosys's net profit was up 4.1 per cent
from Rs 2,875 crore in the October-December, 2013 quarter,
while revenue was lower by 1.2 per cent from Rs 13,026 crore.
For FY 2014, the net profit was up 13 per cent at Rs
10,648 crore and revenue grew 24.2 per cent to Rs 50,133
crore.
North America accounted for 59.8 per cent of the
revenues, Europe (25.2 per cent), India (2.6 per cent) and
Rest of the World (12.4 per cent)
Infosys added 10,997 employees (gross) in the last
quarter of FY 2014 and 39,985 employees during the entire
fiscal to take the total headcount to 1,60,405.
Infosys and its subsidiaries added 50 clients during the
quarter and 238 during the year, the company said.
Its liquid assets including cash and cash equivalents,
available-for-sale financial assets, certificates of deposits
and government bonds stood at Rs 30,251 crore in Q4 FY'14.
This is against Rs 27,440 crore in the previous quarter
(October-December) and Rs 23,958 crore in Q4 FY 2013.
It has also decided to increase the dividend pay-out
ratio to up to 40 per cent of post-tax profits effective
fiscal 2014 from the earlier practice of up to 30 per cent of
post-tax profits.
"Our cash and cash equivalents crossed Rs 30,000 crore
during the quarter. We have increased the dividend payout
ratio to up to 40 per cent of post-tax profits effective FY'14
to enhance returns for our shareholders," Infosys CFO Rajiv
Bansal said.
The firm's Board of Directors has recommended a final
dividend of Rs 43 per share for fiscal 2014.
On the deal pipeline, Shibulal said: "Deal pipeline has
marginally improved quarter on quarter. At the same time
decision cycles are longer and especially in the discretionary
spending area, the decision cycle have become longer and that
is reflected in our numbers.
"Our discretionary revenue q-o-q has decreased. Large
outsourcing deals we have closed four this quarter (Q4 FY
2014) which are in USD 100 million total contract value, which
takes long incubation time."
Infosys, which has been losing market share to industry
peers in recent years, brought back N R Narayana Murthy from
retirement in June last year to revive the company's sagging
fortunes.
Once a poster boy for the USD 110-billion Indian IT-BPO
sector, Infosys has been battling top level exits, which
analysts have raised concerns about.
Over the last two years, Infosys has seen nine top level
exits including leaders who were tipped to be in fray for the
top job.
Former company's America head Ashok Vemuri quit to
become CEO at iGate, while CFO V Balakrishnan joined political
party AAP. Other exits include global sales head Basab
Pradhan, Head of Utilities and Resources for North America
Stephen Pratt, Head of BPO sales, Australia, Kartik Jayaraman
and BPO Head, Latin America, Humberto Andrade.
While some attributed the exits to the return of Murthy
at the helm of affairs, the company has maintained that it
remains unperturbed by these exits.
Infosys has also initiated the process of looking for
Shibulal's successor, who will step down as the company's CEO
in January 2015, ahead of his due retirement date in March.
The firm has appointed Egon Zehnder, an executive search
firm, to assist the Nominations Committee in identifying an
external slate of candidates. This would be the first time
Infosys is likely to have a CEO who is not among the founders
of the company.
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