Infosys Q2 profit dips 2.2% to ₹4,019 cr

INFOSYS RAISED THE LOWER-END OF ITS FY20 REVENUE GUIDANCE AND THE REVISED FORECAST NOW STANDS AT 9-10%

India’s second-largest IT services company Infosys on Friday said its consolidated net profit declined by 2.2% to ₹4,019 crore for the July-September 2019 quarter.

This is against a net profit of ₹4,110 crore in the same period last fiscal, Infosys said in a regulatory filing.

The Bengaluru-based company’s revenue rose by 9.8% to ₹22,629 crore in the quarter under review from ₹20,609 crore in the year-ago period. In constant currency terms, this translates into an 11.4% increase.

Infosys also raised the lowerend of its FY2019-20 revenue guidance and the revised forecast now stands at 9-10% growth in constant currency terms.

At the beginning of the fiscal, Infosys had said it expects revenue growth of 7.5-9.5% for FY2019-20. Subsequently, while announcing its first-quarter numbers, the company raised its revenue growth guidance for the fiscal to 8.5-10%.

“Our performance was robust on multiple dimensions—revenue growth, digital growth, operating margins, operational efficiencies, large deal signings and reduction in attrition,” Infosys chief executive and managing director Salil Parekh said.

All these are clear signs that the company is progressing well in its journey of client-centricity and maximising value for its stakeholders, he added.

In dollar terms, net profit was at $569 million while revenue was at $3.21 billion in the said quarter.

The results come a day after larger rival, Tata Consultancy Services announced its secondquarter results. The Mumbaibased firm reported a 1.8% rise in consolidated net profit at ₹8,042 crore while its revenue grew by 5.8% to ₹38,977 crore.

In the September 2019 quarter, Infosys’ digital revenues grew 38.4% year-on-year to $1.23 billion, accounting for 38.3% of its total revenues.

It has also declared an interim dividend of ₹8 per share. Infosys announced its results after the close of trading hours. Its scrip had closed at ₹815.70 apiece, up 4.19% from the previous close on BSE. “We saw expansion in operating margins during the quarter driven by improvement in operational parameters and cost efficiencies. We took the first step towards implementation of our new capital allocation policy by increasing interim dividend by over 14% compared to FY19,” Infosys CFO Nilanjan Roy said.

The company completed its share buyback of ₹8,260 crore on August 26, 2019, wrapping up its additional capital return programme of up to ₹13,000 crore announced in April 2018.

“Q2 witnessed another quarter of all-round growth in industry segments and geographies which is a testimony to our strong credentials and client relevance. Large deal wins were $2.8 billion. We are especially pleased by the reduction in attrition driven by our focus on enhanced employee value proposition,” Infosys COO Pravin Rao said.