BENGALURU, India, July 13, 2018 /PRNewswire/ --
- Digital revenues at $803 million (28.4% of total revenues), sequential growth of 8.0% and year-on-year growth of 25.6% in constant currency terms - 1:1 bonus issue of equity shares and 1:1 stock dividend of American Depositary Shares - Q1 19 revenues grew year-on-year by 6.8% in USD terms; 6.0% in constant currency terms - Q1 19 revenues grew sequentially by 0.9% in USD terms; 2.3% in constant currency terms - Operating margins at 23.7%, at the upper quartile of the guidance - Large deal wins crossed $1 billion, of which over 40% was from Financial Services - $ 100 mn clients increased sequentially by 4 to 24 - Utilization (excluding trainees) at all-time high of 85.7% - Free Cash Flow up sequentially by 32.1% in USD terms - RoE increases to 25.5% as compared to 24.1% last quarter - EPS grew by 3.9% on a year-on-year basis - FY 19 revenue guidance in constant currency retained at 6%-8%; FY 19 operating margin guidance retained at 22%-24%
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1. Financial Highlights
Consolidated results under International Financial Reporting Standards (IFRS) for the quarter ended June 30, 2018
- Revenues were $2,831 million for the quarter ended June 30, 2018 YoY growth of 6.8%; QoQ growth of 0.9% - Net profit was $534 million for the quarter ended June 30, 2018, including impact of $39 million on account of reduction in the fair value of Assets held for sale YoY decline of 1.2%; QoQ decline of 6.5% - Basic EPS was $0.25 for the quarter ended June 30, 2018, including impact of $0.02 on account of reduction in the fair value of Assets held for sale YoY growth of 3.9%; QoQ decline of 6.5%
"The strong revenue and margin performance in this quarter shows that our dual emphasis on Agile Digital and AI-driven Core services is resonating with our clients," said Salil Parekh, CEO and MD. "With our Agile Digital business growing sequentially at 8% in constant currency and increase in our large deal wins to over US$ 1 billion, we see good traction in the market."
"Our emphasis on deepening client relationships resulted in strong client metrics including increase in the number of $100 million+ clients to 24," said U B Pravin Rao, COO. "Utilization excluding trainees reached an all-time high of 85.7%."
"We had broad-based financial performance on multiple fronts - RoE crossed 25%, Free cash flow was up 32% quarter on quarter and operating margins were at the upper quartile of our margin guidance," said M.D. Ranganath, CFO. "While we continue to make strategic investments to leverage the opportunities in Digital, our relentless focus on operational efficiencies continued in this quarter."
2. Bonus issue of equity shares
The Board in its meeting held on July 13, 2018 has considered, approved and recommended a bonus issue of one equity share for every equity share held and a stock dividend of one American Depositary Share (ADS) for every ADS held, as on a record date to be determined. Consequently, the ratio of equity shares underlying the ADSs held by an American Depositary Receipt holder would remain unchanged. The Board approved and recommended the issue of bonus shares to celebrate the 25th year of Company's public listing in India and to further increase the liquidity of its shares. The bonus issue of equity shares and ADSs will be subject to approval by the shareholders, and any other applicable statutory and regulatory approvals.
The bonus shares once allotted shall rank pari passu in all respects and carry the same rights as the existing equity shareholders and shall be entitled to participate in full, in any dividend and other corporate action, recommended and declared after the new equity shares are allotted.
3. Addition to the Board
The Board appointed Michael Gibbs as an Independent Director of the Company effective July 13, 2018 for a period of three years, based on the recommendation of the Nomination and Remuneration Committee of the Board.
4. Assets Held for Sale
During the three months ended June 30, 2018, on remeasurement, including consideration of progress in negotiations on offers from prospective buyers for Panaya, the Company has recorded a reduction in the fair value of Disposal Group held for sale amounting to $39 million in respect of Panaya. Consequently, profit for the three months ended June 30, 2018 has decreased by $39 million resulting in a decrease in Basic earnings per equity share by $0.02 for the quarter ended June 30, 2018.
5. Adoption of Ind AS 115 - Revenue from contracts with customers
Effective April 1, 2018, the Company adopted Ind AS 115 "Revenue from Contracts with Customers" using the cumulative catch-up transition method which is applied to contracts that were not completed as of April 1, 2018. Accordingly, the comparatives have not been retrospectively adjusted. The effect on adoption of Ind AS 115 was insignificant.
6. Voluntary delisting of American Depositary Shares from Euronext Paris and London
In line with the announcement made on June 11, 2018, the Company has voluntarily delisted its American Depository Shares ("ADSs") (ISIN US4567881085) from Euronext Paris and London on July 5, 2018 and its ADS were removed from Euroclear France on July 10, 2018. The primary reason for voluntary delisting from Euronext Paris and London was the low average daily trading volume of Infosys ADSs on these exchanges, which was not commensurate with the related administrative expenses. Infosys ADSs will continue to be listed on the NYSE under the symbol "INFY" and investors can continue to trade their ADSs on the New York Stock Exchange.
About Infosys
Infosys is a global leader in next-generation digital services and consulting. We enable clients in 45 countries to navigate their digital transformation. With over three decades of experience in managing the systems and workings of global enterprises, we expertly steer our clients through their digital journey. We do it by enabling the enterprise with an AI-powered core that helps prioritize the execution of change. We also empower the business with agile digital at scale to deliver unprecedented levels of performance and customer delight. Our always-on learning agenda drives their continuous improvement through building and transferring digital skills, expertise, and ideas from our innovation ecosystem.
Visit http://www.infosys.com to see how Infosys can help your enterprise navigate your next.
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