Infosys Q1 net profit jumps 21.6% to Rs2,886 crore

Infosys Ltd today reported a 21.6 per cent jump in its net profit for the quarter ended 30 June 2014, at Rs2,886 crore and a 21 per cent increase in standalone net profit for the quarter at Rs2,720 crore.

India's second-largest software services exporter beat market expectations with a 3.5 per cent quarter-on-quarter jump in consolidated net profit for the April-June 2014-15 quarter.

The company also retained sales growth outlook for this year on surging demand for outsourcing services.

Earnings per share (EPS) rose in line with profit to Rs50.51 for the quarter ended 30 June 2014, showing a year-on-year growth of 21.6 per cent and a quarter-over-quarter growth of 3.5 per cent.

Revenues for the quarter stood at Rs12,770 crore, up 13.3 per cent year-on-year and 0.8 per cent above the previous quarter levels.

The company, however, saw a decline in its liquid assets, including cash and cash equivalents, available-for-sale financial assets, certificates of deposits and government bonds to Rs29,748 crore as of 30 June 2014 from Rs30,251 crore as of 31 March 2014.

Infosys expects FY'15 revenues to grow 7-9 per cent in dollar terms and by 5.6-7.6 per cent in rupee terms.

Infosys, which named Vishal Sikka, a former senior executive at German software company SAP AG, as CEO last month, has been reeling under a staff exodus and loss of market share to rivals.

Infosys and its subsidiaries added 61 clients during the quarter while its total employee strength stood at 1,61,284 at the end of June 2014, with the addition of 11,506 employees (gross) during the quarter.

''We continue to enjoy the confidence of our clients by demonstrating superior execution capability and value realisation.'' said S D Shibulal, CEO and managing director. ''As I transition the CEO mantle to Vishal, I am confident that he will leverage this strong foundation to take Infosys to greater heights. I wish him the very best."

''We saw positive trends in our large deal wins during the quarter. We believe that this momentum will hold us in good stead as we focus on increasing volumes.'' said U B Pravin Rao, COO.

The one worrying factor for Infosys, however, has been rising employee attrition rates, including in the top rung. Rao said the company has taken various initiatives to retain good talent.

''We improved operational performance as a result of our cost optimisation initiatives and a focus on increasing productivity and utilisation. This partially offset the impact of compensation increases for our employees this quarter.'' said Rajiv Bansal, CFO. ''It will help us invest in areas that will accelerate growth.''

The company sees steady growth in (consolidated) revenue for the fiscal year ending 31 March 2015, with revenues growing at 5.6-7.6 per cent.

During the quarter, Infosys partnered with a global automotive leader to engineer new concepts in driver awareness and safety telematics and launched a cloud-based version of its Clinical Trial Supply Management solution to help life sciences companies enhance the efficiency of clinical trial processes and drive greater collaboration between pharmaceutical companies and contract research organisations.

Besides, the company is working with clients in areas like smart phone applications in insurance business, app-based safe driving, developing B2C Android app, designing and building platform for mobile gaming, alert solutions to make banking easier for its customers, etc.