Wipro Q1 PAT at Rs 726 crore

Bangalore based Wipro Technologies announced its Q1 results on Thursday. Compared to the last quarter, its net profit dropped to Rs 726 crore (Rs 7.26 billion).

Highlights of the Results

• Wipro Limited Revenue increased by 34% Year on Year (YoY) to Rs. 42.03 billion (Rs. 4,203 Crores);
• Profit After Tax (PAT) was Rs. 7.26 billion (Rs. 726 Crores).
• Global IT Services & Products Revenue in dollar terms was $726.1 million, a YoY growth of 35%. In rupee terms, Revenue stood at Rs. 29.5 billion (Rs. 2,950 Crores), a YoY growth of 20%.
• Profit Before Interest & Tax (PBIT) for Global IT Services and Products segment was Rs. 6.36 billion, 21.6% of Revenues.
• Global IT Services & Products added 39 new clients in the quarter. Deals won during the quarter included a $130 million multi-year Total Outsourcing engagement from a utility company in Europe.
• Wipro's India, Middle East & Asia Pac business recorded 61% growth in PBIT YoY. Revenue grew 64% YoY.
• Wipro Consumer Care and Lighting business Revenue grew 33% YoY and PBIT grew 32% YoY.
• Wipro signed a definitive agreement to acquire Unza, a leading Personal Care Company based in Singapore.
• Wipro won the 'Supplier Excellence award' from Verizon; Wipro and Cairn India partnership won the 'FAO Research Award of Distinction' in the Finance and Accounting space.

Wipro also bagged SAP's 'Pinnacle Award for Software Solution leadership and Forrester rated Wipro as Leader in Global IT Outsourcing.

Performance for the Quarter ended June 30, 2007 and Outlook for Quarter ending September 30, 2007

Azim Premji, Chairman of Wipro, commenting on the results said, "The results for the quarter are satisfying considering the strong headwinds faced by us in the form of an appreciating rupee. Our IT Services Business continued to witness broad based growth, across Verticals, Geographies and Service lines.

"Our growth in Revenues was primarily driven by strong volume growth across our business units. Our differentiated services, Technology Infrastructure Services and Package Implementation grew by over 50% YoY, while our Business Process Outsourcing and Testing Services delivered growth in excess of 40% YoY.

"Amongst our Verticals we saw strong growth in Finance Solutions, Telecom Service Providers, Manufacturing and Technology, Media, Transportation & Services Verticals. Our new client additions continues to be robust and we have had a good set of wins during the quarter in our BPO, Package Implementation and Technology Infrastructure Services, including a multi year deal of $130 million.

Looking ahead, for the quarter ending September 2007, we expect our Revenue from our Global IT services business to be approximately $777 million. Wipro's global brand campaign on Applied Innovation is the manifestation of our 'Applying Thought' credo in our Global IT Business.

"It is how Wipro infuses newer ideas and newer ways of doing things into the business ecosystem and improves outcomes for our customers in the areas of cost and productivity improvements, global delivery and collaboration, faster time to market and measurable business results - often without major disruptive change. The campaign highlights how Wipro transforms ideas to business results. Wipro, in collaboration with IT Association of America, International Association of Outsourcing Professionals and Forbes will host the Global Applied Innovation Awards for Business Excellence this year, to recognize innovations that maximize business impact in large corporations.

"During the quarter, our Consumer Care and Lighting Business took a big leap by acquiring Unza, South East Asia's leading Personal Care Company. This is an important step for the business as we see large opportunities in the emerging Asian economies. Unza has a set of strong brands, an excellent management team and overall is a great fit to our Consumer Care Business. The growth rates they have achieved in the past are commendable and the profitability is amongst the best in the industry".

Suresh Senapaty, Chief Financial Officer of Wipro, said, "During the quarter ended June 2007, our Global IT Services & Products Revenue was $726.1 million, which was ahead of our guidance of $711 million for the quarter. On the margin front, operational improvements helped us in partially offsetting the pressure on profitability arising out of rupee appreciation and contain the sequential Operating Margin drop to less than 250 basis points."