Joining the top Indian software firms reporting disappointing results, Infosys, on Friday, announced a fall in quarterly profit and revenues on quarter-on-quarter basis, but they were marginally up year-on-year for the period ended March 31, 2015. The company’s annual revenues for 2014-15 were short of the guidance it had provided.
The results were an indication of volatile currency movements and structural changes global IT industry is going through The company’s net profit fell 4.7 per cent at Rs.3,097 crore for the January-March 2015 quarter against Rs.3,250 crore in the preceding quarter. However, it was up 3.5 per cent when compared with year-ago period.
Revenues of the company declined by 2.8 per cent at Rs.13,411 crore when compared with Rs.13,796 crore in Q3 of 2014-15. However, Q4 revenues were up 4.2 per cent when compared with a year ago period. In terms of dollars, revenues dropped to 2.6 per cent sequentially to $2,159 million ($2,218 million) during the fourth quarter of 2014-15. Net profit fell by 4.6 per cent at $498 million.
“Pricing continued to be under pressure due to increasing commoditisation in the traditional IT services business. Also, customers are becoming increasingly demanding,” Vishal Sikka, CEO and Managing Director of the company said while announcing the company’s results at its sprawling facility at Mahindra City near Chennai.
For the year ended March 31, 2015, the company’s net profit was up 15.8 per cent at Rs.12,329 crore when compared with Rs.10,648 crore in the previous year, aided by strong rise in operating profit. Revenues stood at Rs.53,319 crore against Rs.50,133 crore, posting a rise of 6.4 per cent.
In geographical contribution, revenue share from North America grew to 62.8 per cent for the year ended March 31, 2015, from 61.6 per cent in the preceding quarter, while other geographies saw drop. For the full year too, only north America saw rise in contribution.
“ Our focussed employee engagement initiatives over the last few months have resulted in containing employee attrition to one of the lowest in recent times. And our investments in innovation and in renewing our capabilities are helping to elevate our client relationships. ”— Vishal Sikka, CEO and Managing Director, Infosys
The Board recommended a bonus issue of one equity share for every equity share held and a stock dividend of one American Depositary Share (ADS) for every ADS held. It also recommended a final dividend of Rs.29.50 per share (equivalent to Rs.14.75 per share after 1:1 bonus issue, if approved by shareholders) for the financial year ended March 31, 2015.
To acquire digital e-commerce firm
The company announced the acquisition of digital e-commerce company Kallidus for $120 million (about Rs.763 crore) — its third takeover since Mr. Sikka took over as CEO in August last year. The country’s second largest software services exporter said it has also acquired minority stake in an air quality monitoring start-up Airviz for $2 million (about Rs.13 crore).
The move is a part of ‘Renew and New’ strategy adopted by $8.71 billion company under Mr. Sikka to enhance competitiveness and productivity of current service lines by leveraging automation, innovation and artificial intelligence. Kallidus delivers a cloud hosted platform for mobile websites, apps, and other digital shopping experiences across mobile, tablet, desktop, in-store and all emerging channels to large retail clients worldwide,” he said during an investors’ call.
The platform enables retailers to provide mobile specific experience to their customers through an agile and flexible environment, enabling personalisation.
