TCS - SECOND QUARTER RESULTS -SEP 2014 - REVENUE UP13.5%YoY; NPT UP 13.2% YoY

TATA CONSULTANCY SERVICES (TCS)

2^nd Quarter Results (Q/E Sep,2014)

TCS has declared another set of excellent results for the second quarter ending September,2014.

Strong Volumes drive steady growth in Q2 FY 2014-15

Revenue at $3.93 billion up 6.4 % Q-o-Q, up 17.7 % Y-o-Y

Highlights for Q2 2014-15

Ø  Net Income at $ 872 million up 3.2 % Q-o-Q; up 17.8 % Y-o-Y

Ø  Strong Volume growth at 6.1%

Ø  Crosses Milestone of employing 100,000 women professionals

Financial Highlights for Quarter

Ø  Operating profit at $ 1,055 million; Growth of 8.6 % Q-o-Q and 4.8 % Y-o-Y

Ø  Earnings per share at $ 0.45

Business Highlights for Quarter

Ø  Gross employee addition: 20,350

Ø  Total headcount: 313,757

Ø  Utilization: 86.2% (excluding trainees) & 81.3% (including trainees)

Ø  Four $50+ million clients added; Nine $20+ million clients added

Strong Volumes drive steady growth in Q2

Ø  Revenue at Rs.23,816 crore up 7.7% Q-o- Q; up 13.5% Y-o-Y

Ø  Net Profit at Rs.5,244 crore down 5.8% Q-o-Q; up 13.2% Y-o-Y

Ø  Strong organic volume growth at 6.1%

Ø  Crosses Milestone of employing 100,000 women professionals

Financial Highlights for Quarter

Ø  Operating Profit at Rs.6,351crore; Growth of 7.0% Q-o-Q

Ø  Operating Margin at 26.7%

Ø  Dividend per share of Rs.5

Ø  Earnings Per Share at Rs.26.78

Business Highlights for Quarter

Ø  Gross employee addition:20,350

Ø  Total headcount: 313,757

Ø  Utilization: 86.2% (excluding trainees) & 81.3% (including trainees)

Ø  Four $50+ million clients added; Nine $20+ million clients added 

Commenting on the Q 2 performance, Chief Executive Officer and Managing Director, N Chandrasekaran said: “Driven by strong volumes and robust utilization rates, this has been a quarter of steady, consistent performance. Our well-rounded showing has been highlighted by broad-based growth in our key markets, industries and services as we continued to deepen our engagement with customers.”

Mr Chandrasekaran added: “Our customers are focused on using Digital technologies to re-imagine their business in multiple dimensions and with our significant investments as well as deep capabilities in these areas, we remain well positioned to act as a catalyst and enable their business innovation across the enterprise.” 

OTHER FEATURES FROM Q2 RESULTS :

CMC Amalgamation with TCS : TCS owns 51% of CMC and will amalgamate the rest through a share swap. CMC shareholders will receive 79 shares of Rs 1 each of TCS. for 100 shares of Rs 10 each of CMC. The deal gives TCS a greater reach into the India .

Guidance: Third-quarter will be a seasonally weak one due to furloughs and holidays

Markets:  Domestic market grew in double digits QoQ. TCS is turning positive on the India market. However, TCS slipped in Latin America as it does not yet have the scale there to smooth over bumps. Chandrasekaran said the goal was to grow that market into predictability

Verticals: TCS saw robust growth across most industry verticals.

Discretionary spending: TCS sees strong demand in discretionary spending which is expected to power revenue growth in its digital business.

In the overall Picture, TCS continues to be a strong No.1. in the Indian software Industry, with Infosys now striving to emerge as a close No.2.

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