After last week’s disappointing results from Infosys that spooked markets, Tata Consultancy Services (TCS), on Wednesday, came up with an encouraging set of numbers for the fourth quarter of 2012-13 that should clear pessimism over the industry’s prospects.

The industry leader announced a 24.9 per cent rise in net profit to Rs.3,616 crore for the fourth quarter of 2012-13, compared to the same period last year. Revenues rose 24 per cent to Rs.16,430 crore.

“We have delivered another strong quarter, and have closed the year with a good run rate,” N. Chandrasekaran, CEO, told a press conference.

Operating profit for the period was up 18.6 per cent at Rs.4,358.4 crore while operating profit margin was 26.5 per cent.

“We maintained margins despite a Rs.161 crore settlement and a Rs.100 crore currency headwind that we faced during the quarter. The former had an impact of 98 basis points and the latter of 64 basis points on margins.’’ There was a 4.4 per cent volume growth across segments except telecommunications which saw marginal growth and continental Europe outperformed the U.K., Mr. Chandrasekaran said.

In the fourth quarter, there was a net addition of 12,559 employees and an attrition rate of 10.6 per cent, the lowest in the industry.

For the whole year, the net profit grew 31 per cent to Rs.13,941 crore, while revenues rose 28.8 per cent to Rs.62,989.5 crore.

Operating profit was up 25.8 per cent at Rs.17,008 crore with operating margins down 64 basis points at 27 per cent.

It announced a total dividend of Rs.22 per share, including a proposed Rs.13 final dividend.

“TCS delivered a year of strong growth with all markets and industry segments growing in double digits,” Mr. Chandrasekaran said.

Rajesh Gopinathan, CFO, said, “Our growth was well-rounded in 2012-13, and we have endeavoured to maintain our profitability despite stiff headwinds and increased volatility through the year.”

He said the company would maintain its capital expenditure of Rs.2,600 crore in the current year.

During the year, the company added 69,000 professionals and has made 25,000 offers for trainees who will join TCS in the second quarter of this year.

TCS is looking at Europe as a focus area for organic and inorganic growth. “We continue to look at Germany, France and Japan as there are outstanding global players there,” said Mr. Chandrasekaran

He expressed confidence that 2013-14 would bring greater opportunities. “By and large, the environment presents a lot of opportunities for us as companies are looking at technology to transform themselves to achieve growth. We have a strong deal pipeline, deal closures are happening and there is traction in discretionary spends.”


Coding errorApril 19, 2013

More In: Industry | Business