BENGALURU, India, July 12, 2019 /CNW/ -- "We had a strong start to
FY 20 with constant currency growth accelerating to 12.4% on year
over year basis and digital revenue growth of 41.9%. This was
achieved through our consistent client focus and investments which
have strengthened our client relationships," said Salil Parekh, CEO and MD. "Consequently, we
are raising our revenue guidance for the year from 7.5%-9.5% to
8.5%-10%."
41.9%
YoY
|
12.4%
YoY
|
2.8%
QoQ
|
20.50%
|
$2.7
bn
|
Digital CC
growth
|
CC growth
|
CC growth
|
Operating
margin
|
Large deal
signings
|
- Q1 20 revenues grew year-on-year by 10.6% in USD; 12.4% in
constant currency
- Q1 20 revenues grew sequentially by 2.3% in USD; 2.8% in
constant currency
- Q1 20 Digital revenues at $1,119
million (35.7% of total revenues), year-on-year growth of
41.9% and sequential growth of 8.6% in constant currency
- Increased FY 20 revenue growth guidance range to 8.5%-10% in
constant currency
- Maintained FY 20 operating margin guidance range of
21%-23%
1. Financial Highlights - Consolidated
results under International Financial Reporting Standards
(IFRS)
Revenues were $3,131 million,
growth of 10.6% YoY and 2.3% QoQ
Operating profit was $642 million,
decline of 4.2% YoY and 2.3% QoQ. Operating margin was 20.5%.
"We had a good quarter as we continue to leverage our digital
navigation framework to help our clients build and nurture their
live enterprise," said Pravin
Rao, COO. "Large deal TCV was highest ever at
$2.7 bn. Segment growth was robust
with all large regions and most verticals growing at double digits
yoy in constant currency."
"Our first quarter results and continued focus on operational
efficiencies gives us the confidence on our revenue and margin
guidance for the year," said Nilanjan
Roy, CFO. "Continuing our objective of improving
shareholder returns, we have revised our capital allocation policy
upwards to distribute ~ 85% of free cash flows cumulatively over a
5-year period."
2. Capital Allocation
- The Company is on track towards completing its previously
announced share buyback of INR 8,260
crore. The company has till date bought back shares worth
`INR 5,934 crore.
- The Company's current policy is to pay up to 70% of the free
cash flow annually by way of dividend and/or buyback. The Board has
reviewed and approved a revised Capital Allocation Policy of the
Company after taking into consideration the strategic and
operational cash requirements.
"Effective from Financial year 2020, the company expects to return
approximately 85% of the free cash flow cumulatively over a 5-year
period through a combination of semi-annual dividends and/or share
buyback and/or special dividends, subject to applicable laws and
requisite approvals, if any."
Free cash flow is defined as net cash provided by operating
activities less capital expenditure as per the consolidated
statement of cash flows prepared under IFRS
Dividend and buyback include applicable taxes
3. Client wins & Testimonials
- We were selected by Finnish postal service Posti as a
strategic partner for the digital transformation of its business
and IT services to drive the modernization of its IT applications
and infrastructure, helping it move to a flexible IT service model.
This will also strengthen Posti's ability to respond to changes in
customer needs with agility and provide a seamless customer user
experience through a dedicated command center.
- We entered into long term strategic partnership with Toyota
Material Handling Europe to help in its digital transformation
journey by facilitating transformation to a scalable digital hybrid
cloud platform, providing application services, digital workplace,
infrastructure management and a dedicated data center
operation.
- Infosys McCamish, a US based subsidiary of Infosys BPM entered
into a partnership with Pan-American Life Insurance Group
(PALIG), a leading provider of life, accident and health
insurance to provide policy administration services for PALIG's new
Global Assets Indexed Universal Life product.
- We have partnered with a leading consumer technology company to
help them localize their virtual assistant by training their AI.
Infosys is helping the client to define its overall global strategy
for localization while analyzing data to identify patterns which
can train the AI to respond better to the user command. This will
improve their virtual assistant to provide a better user
experience.
- Marc Schmidt, Head of SDD and
GIT-ACI, BSH said, "At BSH GmbH, for the software
Development Platform (SDD) which is used for developing thousands
of micro to large scale applications, we wanted to deploy an
auto-scaling Infrastructure on AWS Cloud that can handle millions
of users across the world. Infosys leveraging its Agile and DevOps
methodology and expertise, automated build and deployment which led
to an overall 70% reduction in environment provisioning time, Zero
downtime, 100% improvement in recovery time objectives."
- One of the world leaders in the manufacturing of connectivity
and sensor products engaged Infosys to transform their delivery of
Sales solutions needed for their globally dispersed sales team,
leveraging Salesforce ecosystem. Infosys over the last 12 months
has moved to a Highly Agile Capability based delivery model and
helped in an estimated 40% improvement in time to market for
solutions, shortened release cycles from once-a-quarter to
on-demand releases and improvement in time to revenue of solutions
by upto 25%
Recognitions
- Infosys positioned in HFS Top 10 Healthcare Services 2019
- Recognized as a Leader in NelsonHall's SAP HANA and S/4HANA
services report
- Recognized as a Leader in the Enterprise Platform IT Services
in BFS PEAK Matrix™ Assessment 2019
- Recognized in the HFS Top 10: Managed Security Services
(MSS)
- Recognized in the HFS Top 10 Google AI Services
- Recognized as a Leader in The Forrester Wave™: Global API
Strategy And Delivery Service Providers, Q2 2019
- Recognized as a Leader in the NEAT on Next-Generation Software
Testing Services
- Recognized as a Leader in the IDC MarketScape: Worldwide
Microsoft Implementation Services 2019 Vendor Assessment
- Recognized in the NEAT on IoT in Digital Transformation
- Recognized in the HFS Top 10 Manufacturing Service Providers
2019
- Recognized in the HFS Top 10 Energy Services 2019
- Recognized as a Leader in Gartner Magic Quadrant for
Public Cloud Infrastructure Managed Service Providers
- Awarded the "Most Valuable Partner – Commercial Cloud" Award by
Oracle
- Won the Golden Peacock Environment Management Award
- Won the Pega partner excellence award in recognition of
innovative practice development and continued investment in the
growth of a strong delivery practice
- Recognized with the Global Partner of the Year Award for
driving customer success at TIBCO NOW
- Recognized as MuleSoft Americas Growth & Emerging Partner
of the Year 2019 by MuleSoft
- Awarded 'System Integrator Partner of the year 2019 for Hybrid
Cloud Solutions' by HPE at HPE Discover 2019
About Infosys
Infosys is a global leader in next-generation digital
services and consulting. We enable clients to
navigate their digital transformation, leveraging our teams
from over 45 countries. With over three decades of
experience in managing the systems and workings of global
enterprises, we expertly steer our clients through their
digital journey. We do it by enabling the enterprise with
an AI-powered core that helps prioritize the execution of
change. We also empower the business with agile digital at
scale to deliver unprecedented levels of performance and
customer delight. Our always-on learning agenda drives their
continuous improvement through building and transferring
digital skills, expertise, and ideas from our
innovation ecosystem.
Visit www.infosys.com to see how Infosys (NYSE: INFY) can help your enterprise navigate your next.
Safe Harbor
Certain statements mentioned in this presentation 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, 2019. 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. 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
Audited Condensed
Consolidated Balance Sheet as at
|
(Dollars in millions
except equity share data)
|
|
|
June 30,
2019
|
March 31,
2019
|
ASSETS
|
|
|
Current
assets
|
|
|
Cash and cash
equivalents
|
2,266
|
2,829
|
Current
investments
|
778
|
958
|
Trade
receivables
|
2,290
|
2,144
|
Unbilled
revenue
|
964
|
777
|
Prepayments and other
current assets
|
851
|
827
|
Income tax
assets
|
38
|
61
|
Derivative financial
instruments
|
26
|
48
|
Total current
assets
|
7,213
|
7,644
|
Non-current
assets
|
|
|
Property, plant and
equipment
|
1,903
|
1,931
|
Right-of-use
assets(B3)
|
540
|
-
|
Goodwill
|
589
|
512
|
Intangible
assets
|
207
|
100
|
Non-current
investments
|
548
|
670
|
Deferred income tax
assets
|
204
|
199
|
Income tax
assets
|
917
|
914
|
Other non-current
assets
|
296
|
282
|
Total non-current
assets
|
5,204
|
4,608
|
Total
assets
|
12,417
|
12,252
|
LIABILITIES AND
EQUITY
|
|
|
Current
liabilities
|
|
|
Trade
payables
|
317
|
239
|
Lease
liabilities(B3)
|
72
|
-
|
Derivative financial
instruments
|
3
|
2
|
Current income tax
liabilities
|
305
|
227
|
Client
deposits
|
4
|
4
|
Unearned
revenue
|
408
|
406
|
Employee benefit
obligations
|
248
|
234
|
Provisions
|
84
|
83
|
Other current
liabilities
|
2,022
|
1,498
|
Total current
liabilities
|
3,463
|
2,693
|
Non-current
liabilities
|
|
|
Lease
liabilities(B3)
|
483
|
-
|
Deferred income tax
liabilities
|
112
|
98
|
Employee benefit
obligations
|
7
|
6
|
Other non-current
liabilities
|
115
|
55
|
Total
liabilities
|
4,180
|
2,852
|
Equity
|
|
|
Share capital- INR 5
($0.16) par value 4,800,000,000 (4,800,000,000) equity shares
authorized, issued and outstanding 4,271,404,014 (4,335,954,462)
equity shares fully paid up, net of 20,094,430 (20,324,982)
treasury shares as at June 30, 2019 (March 31, 2019)
|
334
|
339
|
Share
premium
|
286
|
277
|
Retained
earnings
|
9,969
|
11,248
|
Cash flow hedge
reserve
|
-
|
3
|
Other
reserves
|
432
|
384
|
Capital redemption
reserve
|
15
|
10
|
Other components of
equity
|
(2,854)
|
(2,870)
|
Total
equity attributable to equity holders of the
company
|
8,182
|
9,391
|
Non-controlling
interests
|
55
|
9
|
Total
equity
|
8,237
|
9,400
|
Total liabilities
and equity
|
12,417
|
12,252
|
Infosys Limited and subsidiaries
Audited Condensed
Consolidated Statement of Comprehensive Income for
the
|
(Dollars in
millions except equity share and per equity share
data)
|
|
|
|
Three months ended
June 30, 2019
|
Three months ended
June 30, 2018
|
Revenues
|
3,131
|
2,831
|
Cost of
sales
|
2,122
|
1,819
|
Gross
profit
|
1,009
|
1,012
|
Operating
expenses
|
|
|
Selling
and marketing expenses
|
169
|
149
|
Administrative expenses
|
198
|
193
|
Total operating
expenses
|
367
|
342
|
Operating
profit
|
642
|
670
|
Other income,
net
|
106
|
107
|
Finance
cost(B3)
|
(6)
|
-
|
Reduction in the
fair value of Disposal Group held for
sale(A1)
|
-
|
(39)
|
Profit before
income taxes
|
742
|
738
|
Income tax
expense
|
196
|
204
|
Net
profit
|
546
|
534
|
Other
comprehensive income
|
|
|
Items that will
not be reclassified subsequently to profit or loss:
|
|
|
Re-measurements of
the net defined benefit liability/asset, net
|
(3)
|
-
|
|
(3)
|
-
|
Items that will be
reclassified subsequently to profit or loss:
|
|
|
Fair valuation of
investments, net
|
2
|
(7)
|
Fair value changes on
derivatives designated as cash flow hedge, net
|
(3)
|
1
|
Foreign currency
translation
|
17
|
(468)
|
|
16
|
(474)
|
Total other
comprehensive income/(loss), net of tax
|
13
|
(474)
|
Total
comprehensive income
|
559
|
60
|
|
|
|
Profit
attributable to:
|
|
|
Owners of the
Company
|
546
|
534
|
Non-controlling
interests
|
-
|
-
|
|
546
|
534
|
Total
comprehensive income attributable to:
|
|
|
Owners of the
Company
|
559
|
60
|
Non-controlling
interests
|
-
|
-
|
|
559
|
60
|
Earnings per
equity share(A2)
|
|
|
Basic
($)
|
0.13
|
0.12
|
Diluted
($)
|
0.13
|
0.12
|
Weighted average
equity shares used in computing earnings per equity
share(A2)
|
|
|
Basic
|
4,302,176,860
|
4,346,657,242
|
Diluted
|
4,308,286,160
|
4,350,710,356
|
NOTES:
A. Notes pertaining to previous
quarters / periods
- In the three months ended June 30,
2018, the Company had recorded a reduction in the fair value
amounting to $39 million in respect
of its subsidiary Panaya. The subsidiaries Kallidus and Skava
(together referred to as "Skava") and Panaya, are collectively
referred to as the "Disposal Group". Subsequently the company
reclassified these subsidiaries as they did not meet the criteria
for "Held for Sale".
- Share numbers and EPS have been adjusted for September 2018 bonus issue.
B. Notes pertaining to the current
quarter
- The audited interim condensed consolidated Balance sheet and
Statement of Comprehensive Income for the three months ended
June 30, 2019 have been taken on
record at the Board meeting held on July 12,
2019.
- A Fact Sheet providing the operating metrics of the Company
can be downloaded from www.infosys.com.
- On account of adoption of IFRS 16- Leases effective
April 1, 2019.
IFRS-INR Press
Release: https://www.infosys.com/investors/reports-filings/quarterly-results/2019-2020/q1/Documents/IFRS-INR-press-release.pdf
Fact
Sheet: https://www.infosys.com/investors/reports-filings/quarterly-results/2019-2020/q1/Documents/fact-sheet.pdf
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SOURCE Infosys