Infosys Limited
NSE Symbol INFY
Consolidated results under IFRS for Q1 FY 2012
Revenues were Rs.7,485 crore for Q1FY12; QoQ growth was 3.2%; YoY growth was 20.8%
Net profit after tax was Rs.1,722 crore for Q1FY12; QoQ decline was 5.3%; YoY growth was 15.7%
Earnings per share was Rs.30.14 for Q1FY12; QoQ decline was 5.3%; YoY growth was 15.7%
Others
26 clients were added during the quarter by Infosys and its subsidiaries
Gross addition of 9,922 employees (net addition of 2,740) for the quarter by Infosys and its subsidiaries
1,33,560 employees as on June 30, 2011 for Infosys and its subsidiaries
Business outlook
The company‟s outlook (consolidated) for the quarter ending September 30, 2011 and for the fiscal year ending March 31, 2012, under International Financial Reporting Standards (IFRS), is as follows:
Outlook under IFRS – consolidated*
Quarter ending September 30, 2011
Revenues are expected to be in the range of Rs.7,699 crore and Rs.7,810 crore; YoY growth of 10.8% to 12.4%
Earnings per share (EPS) is expected to be in the range of Rs.29.64 and Rs.30.15; YoY decline of 2.5% to 0.9%
Fiscal year ending March 31, 2012
Revenues are expected to be in the range of Rs.31,777 crore and Rs.32,311 crore; YoY growth of 15.5% to 17.5%
Earnings per share (EPS) is expected to be in the range of Rs.128.20 and Rs.130.08; YoY growth of 7.3% to 8.9%
WHAT COMPANY SAYS :-
“Our top five clients grew by 8.2% this quarter” said S.D. Shibulal, Member of the Board & Chief Operating Officer. “Volumes grew by 4.0% as a result of our tactical engagement with large clients. Our initiatives to address the company’s transition into the next generation of global consulting and technology services will position us as a high-quality player in the IT services space.”
Finacle ™
Finacle™, our universal banking solution won 11 deals this quarter. Of these three were from the Asia Pacific region (APAC) and eight were from Europe, Middle East and Africa (EMEA). 20 client projects went live this quarter of which 11 were from APAC, six from EMEA and three from the Americas.
Finacle™ also announced the availability of Finacle Lite™, the banking solution on a private cloud environment for co-operative banks, community banks and credit unions worldwide. This is an integrated and pre-configured solution that supports all core banking processes across business product lines, entities and currencies in addition to automating critical banking functions.
Finacle™ is being used by over 148 banks across 72 countries to power operations across 47,000 branches. Today, Finacle enables its customer banks to serve 390 million accounts and 289 million consumers worldwide.
Finacle is also leading the financial inclusion objective in India. 45 of the 82 Regional Rural Banks (RRBs) in the country have opted to leverage Finacle across 9,900 branches.
“Our mission to engineer rural India’s progress through financial inclusion is rapidly gaining momentum” said S. Raman, Chairman & Managing Director, Canara Bank. “With more than 800 branches covering the states of UP, Karnataka and Kerala through three Regional Rural Banks, we are truly geared to further expand our rural reach. We are happy to have Finacle™ power this journey towards enhancing our service delivery and promoting financial inclusion.”
Infosys iEngage™
This quarter Infosys iEngage™ signed five strategic wins with large global enterprises. Infosys iEngage™ is a Digital Consumer Platform that helps enterprises engage with consumers across the marketing-sales service lifecycle. It empowers businesses to accelerate awareness, deepen relationships, grow revenue and delight customers.
Infosys iEngage™ also unveiled its new Social Commerce and enhanced Employee Engagement platform. All five platforms of Infosys iEngage™ are now available on smartphone-enabled devices.
Infosys iEngage™ can be delivered through Infosys cloud or client cloud in the Software as a Service (SaaS) model.
Infosys Health Benefit Exchange
This quarter we launched Infosys Health Benefit Exchange, a cost-effective solution designed to help set up the insurance exchanges. This will allow payers to market plans more efficiently while allowing them to get fast and personalized quotes. The unique transaction-based financial model provides participating plans with a more direct and cost-effective route to consumers than individual brokers, and eliminates the requirement of upfront capital investment for states, allowing them to operate their insurance exchanges at almost no cost.
Process Innovation
During the first quarter, Infosys applied for 27 patent applications in India and the U.S. With this, Infosys has an aggregate of 381 patent applications (pending) in India and the U.S. and has been granted 25 patents by the United States Patent and Trademark Office.
Liquidity
As on June 30, 2011, cash and cash equivalents, including investments in available-for-sale financial assets and certificates of deposits was Rs.16,969 crore (`16,005 crore as on June 30, 2010).
| P&L (IN CRORES) | Q1FY12 | Q1FY11 | |
| Revenues | 7,485 | 6,198 | |
| Cost of sales | 4,577 | 3,648 | |
| Gross profit | 2,908 | 2,550 | |
| Operating expenses: | |||
| Selling and marketing expenses | 398 | 339 | |
| Administrative expenses | 558 | 456 | |
| Total operating expenses | 956 | 795 | |
| Operating profit | 1,952 | 1,755 | |
| Other income | 443 | 239 | |
| Profit before income taxes | 2,395 | 1,994 | |
| Income tax expense | 673 | 506 | |
| Net profit | 1,722 | 1,488 | |
| Other comprehensive income | |||
| Fair value changes on available - for-sale financial asset, net of tax effect | (1) | (7) | |
| Exchange differences on translating foreign operations | 28 | (17) | |
| Total other comprehensive income | 27 | (24) | |
| Total comprehensive income | 1,749 | 1,464 | |
| Earnings per equity share | |||
| Basic | 30.14 | 26.06 | |
| Diluted | 30.14 | 26.05 | |
| | | | |
ANNOUNCEMENTS TO NSE
12-07-2011 press release dated July 12, 2011, titled as per Indian GAAP "Q1 revenues grew by 20.8% year on year; sequentially grew by 3.2%" & as per IFRS "Q1 revenues grew by 23% year on year; sequentially grew by 4.3%" .
12-07-2011 standalone Results for the quarter ended on 30-JUN-2011 as follows: Net Sales of Rs. 690500 lacs for quarter ending on 30-JUN-2011 against Rs. 666800 lacs for the quarter ending on 31-MAR-2011. Net Profit / (Loss) of Rs. 166400 lacs for the quarter ending on 30-JUN-2011 against Rs. 173000 lacs for the quarter ending on 31-MAR-2011.
23-06-2011 The name of Infosys Technologies Limited shall be changed to Infosys Limited and the trading symbol of the Company be changed from INFOSYSTCH to INFY w.e.f. June 29, 2011.
STAND ALONE RESULTS OF INFOSYS
A COMPARISON
Net Sales on stand alone basis for Q1 FY 12 stands at Rs.6905 Cr – up by 3.55% from Q4 FY11; Up by 5.68% from Q3 FY 11; Up by 7.47% from Q2 FY 11; and up By 19.92% from Q1 FY 11. Thus, revenue has been moving up steadily each Quarter.
Total Expenditure is Rs.5022 Cr – up by a Huge 33.56% from Q4 FY 11; up by 37.21% from Q3; up by 40.87% from Q2 and up by 53.02% from Q1 FY 11. Thus expenditure in Q1 FY 11 has grown phenomenally by a huge 33.56% QoQ – presumably due to huge induction of people in the quarter.
Profit before tax stands at Rs.2298 Cr – down by 4.13% from Q4FY 11; Up by 1.32% from Q3; Up by 2.73% from Q2; up by 19.75% from Q1 FY 11.Thus, the downfall is purely on account of huge increase in expenditure in the previous Qtr.
Net Profit also follows the same trend and stands at Rs.1654 cr – down by 4.39% from Q4 FY 11; Up by 0.79% from Q3; Up by 0.79% from Q2; and up by a good 15.58% from Q1 FY 11.
Basic EPS on stand alone basis is Rs.28.8 for q1 FY 12 – against Rs.30.15 for Q4 FY 11; Rs.28.59 for Q3 FY 11; Rs.28.59 for Q2; and Rs.24.93 for Q1 FY 11.
STAND ALONE RESULTS TABLE :
| INFOSYSTECH | 30-Jun-11 | 31-Mar-11 | 31-Dec-10 | 30-Sep-10 | 30-Jun-10 |
| Net Sales | 690500 | 666800 | 653400 | 642500 | 575800 |
| Total Expenditure | 502200 | 376000 | 366000 | 356500 | 328200 |
| Profit before tax | 229800 | 239700 | 226800 | 223700 | 191900 |
| Net Profit | 165400 | 173000 | 164100 | 164100 | 143100 |
| Face Value (In Rs | 5 | 5 | 5 | 5 | 5 |
| Paid Up Equity | 28700 | 28700 | 28700 | 28700 | 28700 |
| Reserves | 2587100 | 2421400 | 2380800 | 2215600 | 2318400 |
| Basic EPS after EI | 28.8 | 30.15 | 28.59 | 28.59 | 24.93 |
| Public Holding (%) | 69.3 | 66.36 | 65.67 | 64.82 | 65.34 |
COMMENTS :
Against the current Q1 FY 12 consolidated revenues of Rs. Rs.7,485 crore, Infosys has given a guidance of Rs. Rs.7,699 crore and Rs.7,810 crore; YoY growth of 10.8% to 12.4% for Q2 FY 12.
Against the consolidated EPS of 30.13 for Q1 FY 12, the EPS projection for Q2 FY 12 is in the range of Rs.29.64 and Rs.30.15; YoY decline of 2.5% to 0.9%. This presumably is again due to the huge increase in expenditure in Q1 FY 12 – due to huge salary increases etc.
Infosys has added 26 clients in Q1.
Looking at the attrition rate – the Gross addition of 9,922 employees and net addition of 2,740 – against the total number of 1,33,560 – this appears to be moderate in comparison to other IT companies.
We find that -INFOSYS is making efforts to transform from mere project oriented company into Product oriented company. While the number of Patents applications pending is large – Infosys needs to convert them into Actual Patents and commercialize them quickly. FINNACLE has clicked for Infosys in a good way. If a few more click similarly – INFOSYS can have assured revenues from such products with a good growth trajectory.
The changes in Management have stabilized and will also spur growth for the company.
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