Infosys net profit slips 2.2%, revenue up in Q2

Oct 11, 2019
Bengaluru:  Software major Infosys on Friday reported 2.2 per cent decline in consolidated net profit for the second quarter (Q2) of fiscal 2019-20 to Rs 4,019 crore from Rs 4,110 crore in the same period a year ago.

Sequentially, however, net profit rose 5.8 per cent to Rs 4,019 crore from Rs 3,798 crore from a quarter ago.

In a regulatory filing on the BSE, the city-based IT major said that consolidated revenue for the quarter grew 9.8 per cent year-on-year to Rs 22,269 crore from Rs 20,609 crore in the like period a year ago.

Sequentially, revenue rose 3.8 per cent to Rs 22,269 crore from Rs 21,803 crore a quarter ago.

Under the International Financial Reporting Standards (IFRS), net income declined 2.1 per cent YoY to $569 million from $581 million a year ago, but rose 4.3 per cent sequentially from $546 million.

Gross revenue grew 9.9 per cent YoY to $3.210 million from $2,921 million a year ago and 2.5 per cent sequentially from $3,131 million a quarter ago.

“Our performance in the second quarter was robust on revenue growth, digital growth, operating margins, operational efficiencies, large deal signings and reduction in attrition,” Infosys Chief Executive Salil Parekh said in a statement later.

Though operating profit was flat (0.4 per cent) in rupee terms at Rs 4,912 crore from Rs 4,894 crore a year ago, it grew sharply 9.9 per cent sequentially from Rs 4,471 crore a quarter ago.

Similarly, in dollar terms, operating profit remained flat (0.5 per cent) at $696 million from $692 million a year ago, but rose 8.3 per cent sequentially from $642 million a quarter ago.

“We witnessed another quarter of all-round growth in industry segments and geographies, testifying our credentials and client relevance,” Chief Operating Officer (COO) Pravin Rao said.

Operating margin, however, dipped 2 per cent YoY to 21.7 per cent from 23.7 per cent a year ago but rose 1.2 per cent from 20.5 per cent a quarter ago.

Maintaining the operating margin at 21-23 per cent for the fiscal, the company increased the lower-end of its annual revenue guidance to 9-10 per cent in constant currency for 2019-20.

“We saw expansion in operating margins during the quarter, driven by improvement in operational parameters and cost efficiencies,” Chief Financial Officer Nilanjan Roy said.

Digital revenues at $1,230 million accounted for 38.4 per cent of the total revenue, with 38.4 yearly and 10.7 per cent quarterly growth.

“All these are clear signs that we are progressing well in our journey of client-centricity and maximizing value for our stakeholders,” Parekh said.

The company declared an interim dividend of Rs 8 per share of Rs 5 face value or 160 per cent for the first half of fiscal 2019-20.

It gave Rs 7 per share or 140 per cent interim divided a year ago for the first half (six months) of the last fiscal (2018-19).

The company completed its share buyback of Rs 8,260 crore on August, 26, resulting in additional capital return of Rs 13,000 crore.

“We took the first step towards implementation of our new capital allocation policy by increasing interim dividend by over 14 per cent compared to last fiscal,” added Roy.

The company’s blue-chip scrip gained Rs 32.80 per share at the end of Friday’s trading on the BSE, closing at Rs 815.70 as against Rs 782.90 Thursday’s closing rate and Rs 785.98 open price earlier in the day.

The scrip touched a high of Rs 823.95 and a low of Rs 777 during the intra-day trading session. IANS