Infosys Q1 net up at Rs 532 crore

IT major, Infosys Technologies Ltd [Get Quote] has announced the following audited results for the quarter ended June 30, 2005:

The company has posted a net profit after tax and exceptional item and minority interest of Rs 532 crore (Rs 5.32 billion) for the quarter ended June 30, 2005 as compared to Rs 388 crore (Rs 3.88 billion) for the quarter ended June 30, 2004.

Highlights:

Income was Rs 2,071.59 crore (Rs 2072 billion) for the first quarter ended June 30, 2005; YoY growth was 36.52 per cent
Net profit after tax was Rs 531.92 crore (Rs 5.32 billion) for the first quarter ended June 30, 2005; YoY growth was 36.97 per cent
Earnings per share from ordinary activities increased to Rs 19.63 from Rs. 14.54* for the corresponding quarter in the previous year, an increase of 35.01 per cent *adjusted for the 3:1 bonus issue of shares distributed on July 6, 2004

Others

36 new clients were added during the quarter by Infosys and subsidiaries
Net addition of 3,056 employees for the quarter by Infosys and subsidiaries
39,806 employees as on June 30, 2005 for Infosys and subsidiaries

"The success of our recently concluded Sponsored Secondary ADS issue is yet another confirmation of the confidence the world has in our business model," said Nandan M. Nilekani, CEO, president and managing director.

Business outlook

The company's outlook (consolidated) for the quarter ending September 30, 2005 and the fiscal year ending March 31, 2006, under Indian GAAP and US GAAP, is as follows:

Outlook under Indian GAAP - consolidated

Quarter ending September 30, 2005*

Income is expected to be in the range of Rs 2,202 crore (Rs 22.02 billion) and Rs 2,215 crore (Rs 22.15 billion); YoY growth of 25.88 per cent - 26.62 per cent
Earnings per share from ordinary activities is expected to be between Rs 19.80 and Rs. 20.30; YoY growth of 18.49 per cent - 21.48 per cent

Fiscal year ending March 31, 2006*

Income is expected to be in the range of Rs 8,947 crore (Rs 89.47 billion) and Rs 9,051 crore (Rs 90.51 billion); growth of 25.49 per cent - 26.95 per cent
Earnings per share before exceptional items is expected to be between Rs 84.70 and Rs. 86.00; growth of 23.12 per cent - 25.02 per cent

* conversion 1 US$ = Rs. 43.51

Outlook under US GAAP

Quarter ending September 30, 2005

Consolidated revenues is expected to be in the range of $506 million and $ 509 million; YoY growth of 33.51 per cent - 34.30 per cent
Consolidated earnings per American Depositary Share is expected to be between $0.46 and $0.47; YoY growth of 27.78 per cent - 30.55 per cent

Fiscal year ending March 31, 2006

Consolidated revenues is expected to be in the range of $2.06 billion and $2.08 billion; growth of 29.14 per cent -30.65 per cent
Consolidated earnings per American Depositary Share is expected to be between $1.96 and $1.99; growth of 24.84 per cent - 26.75 per cent
"Infosys Consulting has been commended by clients and analysts as having the right consulting business model," said S Gopalakrishnan, member of the board and COO. "Clients have reported that consulting projects with Infosys Consulting have delivered more than the expected business value. It shows that the value proposition we have created is making Infosys Consulting the benchmark of the profession."

The board of directors co-opted David L Boyles, as an additional director pursuant to Section 260 of the Companies Act, 1956.

Expansion of services and significant projects

Infosys continued to build a leaner, more scalable and aligned organization to handle greater business complexity and provide higher client value. Its investments in new services such as R&D, system integration, infrastructure management services and independent validation solutions have yielded returns both in terms of revenue and value differentiation.

Infosys is redefining the business intelligence landscape in a leading Fortune 1000 digital lifestyle company. The project will be implemented on a SAP business warehouse platform and will be executed using Infosys' Global Delivery Model.

The solution encompasses a variety of Infosys' services, including technical architecture and consulting, change management, development and validation services.

Infosys has also designed and implemented an integrated point of sales replenishment solution for an independent business unit of the world's largest greeting card company. The implementation of the system will avoid stock-outs thereby increasing their retail sales by 10 per cent.

It will also help in reduction of the point of sale (inventory and manual effort spent in entering orders.

Infosys will build a centralized financial and management reporting system for a leading bank in the US. This implementation is part of a larger initiative aimed at building a finance and credit risk data warehouse to support compliance with Basel II requirements.

A market leader in commercial air-conditioners and hardware has sought Infosys' expertise for Sarbanes Oxley compliance, along with other IT services.

A leading global agribusiness with operations in 90 countries has engaged Infosys to consolidate varied data warehouse solution environments into an enterprise-wide data warehouse platform based on SAP data warehouse technology. Infosys' approach will enable standardised processes and uniform data standards.

"Our strategy has been to pursue high-quality prospects among Global 500 companies that will give us large, growing revenue streams for many years," said Basab Pradhan, head (worldwide sales) and senior vice president. "Our pursuit model, team-selling and emphasis on quality of account openings is paying off. This quarter, we started relationships with nine Global 500 companies in diverse industries like pharma, supermarkets, equipment manufacturing, automotive, utilities, insurance and banking in the US as well as Europe."