Infosys posts 25% jump in Q4 profit, but guidance weak

Information technology major Infosys Ltd today reported a 25-per cent jump in its consolidated net profit for the quarter ended 31 March 2014, helped by large deals and an upturn in client spending.

The Bangalore-based company posted a consolidated net profit of Rs2,992 crore for the fourth quarter of the last financial year from Rs2,394 crore in the year-ago period.

Revenue for the reported quarter rose 23.2 per cent to Rs12,875 crore from Rs10,454 crore.

Infosys said it expects its US dollar revenues to be in the range of 7-9 per cent for the 2014-15 fiscal, which is way below industry body Nasscom's projection of 13-15 per cent.

In rupee terms, the firm gave a lower than expected revenue guidance of 5.6-7.6 per cent for the current financial year.

Commenting on the guidance, Infosys chief executive and managing director S D Shibulal – who has already announced his resignation - said, "As we have said in the past, our guidance is a statement of fact. We are coming out from a low momentum quarter, Q4 as well as Q3.

"We have said that some of the challenges that we faced in Q3 and Q4 will continue to be there during the coming year. We have factored in all those things when we have given a guidance of 7-9 percent. Thats how we see things today."

He added that the firm has been able to double its growth rate for the full year (2013-14) compared to last year, while stating that performance in Q4 FY 2014 has been disappointing.

In dollar terms, Infosys' profit grew 9.7 per cent to $487 million in January-March quarter of 2013-14 fiscal, while revenue rose by 7.9 per cent to $2.09 billion.

For FY 2014, net profit grew 1.5 percent to $1.75 billion, while revenue was up 11.5 percent to $8.2 billion over 2012-13 financial year.

Sequentially, Infosys's net profit was up 4.1 per cent from Rs 2,875 crore in the October-December 2013 quarter, while revenue was lower by 1.2 per cent from Rs13,026 crore.

For FY 2014, the net profit was up 13 per cent at Rs10,648 crore and revenue grew 24.2 per cent to Rs50,133 crore.

North America accounted for 59.8 per cent of the revenues, Europe for 25.2 per cent, India 2.6 per cent, and the rest of the world 12.4 per cent.

Infosys added 10,997 employees (gross) in the last quarter of FY 2014 and 39,985 employees during the entire fiscal to take the total headcount to 1,60,405.

Infosys and its subsidiaries added 50 clients during the quarter and 238 during the year, the company said.

Its liquid assets including cash and cash equivalents, available-for-sale financial assets, certificates of deposits and government bonds stood at Rs 30,251 crore in Q4 FY'14.