Infosys Q1 income posts over 45 pc growth

Bangalore, Jul 12: Software major Infosys today reported an income of Rs 3,015 crore for the first quarter of the current fiscal, up by 45.6 per cent year-on-year basis, with net profits after tax (before exceptional items) being Rs 794 crore, a 49.2 per cent increase year-on-year basis.

Revising the guidance for the current fiscal upward, the company aimed at growing at 40.2 per cent to 40.7 per cent during fiscal 2007.

Commenting on the performance, Infosys CEO, President and Managing Director Nandan M Nilekani said ''our efforts in building the brand, developing the client base and expanding strategic accounts have fuelled our robust organic model.'' Infosys and its subsidiaries added 38 new clients during the quarter. The gross addition of 8,097 employees (net 5,694) for the quarter had taken the total strength as on June 30 to 58,409 in Infosys and its subsidiaries.

For the current quarter, the income was expected to be in the range of Rs 3,257 crore and Rs 3,280 crore (YoY growth of 42 per cent to 43 per cent). For the fiscal year, ending March 31, 2007, income was expected to be in the range of Rs 13,350 crore and Rs 13,400 crore (YoY growth of 40.2 per cent to 40.7 per cent).

Chief Operating Officer S Gopalakrishnan, expressing satisfaction over the strong growth of the company, said ''we believe we have the required scale, execution capabilities and end-to-end service offering to take advantage of the momentum seen in the marketplace.''

Mr S D Shibulal, heading the worldwide customer sales and delivery, said ''growth in Europe continues to be strong. Our growth during the quarter is driven mainly by the telecom, financial services and manufacturing sectors.'' Finacle, the universal banking solution from Infosys, consolidated its position as a preferred choice for large global banks. A large Indian bank was deploying Finacle core banking solution, an initiative focused on achieving significant cost advantage, across 600 branches. United Bank of India had licensed Finacle to differentiate its value proposition in retail banking and manage rapid operational growth. A large financial institution in the Caribbean had selected Finacle consumer e-banking and corporate e-banking solutions.

State Bank of India had successfully rolled out Finacle across its branches in 20 countries, including China, the US and Oman.

Finacle treasury solution was rolled out in Equity Bank, Kenya, while Finacle core banking solution was implemented at DBS, Indonesia.

During the quarter, Infosys filed a patent application at the United States Patent and Trademark Office and eight patent applications at the patent office in India for process innovation in IT services. As on June 30, 2006, Infosys had filed 44 patent applications in India and the US.

Infosys' Research and Development arm, SETLabs, was working closely with clients in developing their technology roadmaps.

Infosys was developing Intellectual Property in business-critical areas such as Service Oriented Architecture, High Performance and Grid Computing, Convergence and Mobility, Business Process Management and Information Management.

The company said cash and cash equivalents, including investments in liquid mutual funds, as on June 30 was Rs 3,434 crore, up from Rs 2,684 crore in the corresponding period of the previous year. During the quarter, Infosys incurred capital expenditure of Rs 193 crore, paid dividend including dividend tax of Rs 1,215 crore and paid Rs 530 crore towards acquisition of minority interest in Progeon Limited. Operating cash flows during the quarter were Rs 400 crore as against Rs 578 crore in the same period last year.

Company Chief Financial Officer V Balakrishnan said ''we benefitted from the depreciation of the Rupee against all major currencies during the quarter. Our margins have been maintained despite increase in salaries and visa costs. We continue to focus on margins without compromising on investments needed to meet our growth objectives.'' Continuing to invest in creating a strong training and recruitment engine to meet its growth objectives, the company added about 2,000 employees on a single day during the quarter, the highest at Infosys. ''We are well on our way to hiring 25,000 (gross) employees for the year. Our employee policies and investments in education and training have made Infosys the employer of choice,'' HRD and Education and Research Head T V Mohandas Pai said.

During the quarter, Infosys acquired 87,50,000 equity shares of Progeon Limited from Citicorp International Finance Corp for a consideration of Rs 530 crore. Infosys holds 96.96 per cent of the outstanding equity shares of Progeon Ltd.

The Board had fixed July 14 as the record date to determine the shareholders and holders of ADSs who would receive the bonus equity shares and additional ADSs respectively.

UNI

UNI

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