BENGALURU India--15 Oct--PRNewswire/InfoQuest
"Our second quarter performance is a clear reflection of our ability to help clients on their digital transformation journeys. Our digital
and cloud capabilities combined with intense client relevance are helping us achieve differentiated results in the market as is visible in
2.2% year on year overall revenue growth and 25.4% growth from digital offerings, which now are at 47.3% of revenues," said Salil Parekh,
CEO and MD. "Increase in revenue and margin outlook for FY 21 is due to the continued trust clients have in us. I am extremely proud of our
team for achieving these results in challenging business conditions globally."
25.4% YoY
Digital CC growth
2.2% YoY
CC growth
25.4%
Operating margin
$3.15bn
Large deal signings
INR 12
Interim DPS,
up by 50% YoY
- Q2 revenues grew sequentially by 4.0% in constant currency
- Q2 revenues grew year-on-year by 3.2% in USD; grew by 2.2% in constant currency
- Q2 Digital revenues at $1,568 million (47.3% of total revenues), year-on-year growth of 25.4% in constant currency
- Q2 operating margin at 25.4%, increase of 370 basis points year-on-year
- Q2 free cash flow at $674 million; year-on-year growth of 69.8%
- Q2 net profit at $653 million, year-on-year growth of 14.7%
- Q2 voluntary attrition for IT services declined to 7.8% from 18.3% in Q2 20
- H1 revenues grew by 1.9% in constant currency
- H1 operating margin at 24.1%
- Declared interim dividend of INR 12 per share
- FY 21 revenue growth guidance revised upward to 2%-3% in constant currency
- FY 21 operating margin guidance revised upward to 23%-24%
1. Financial Highlights – Consolidated results under International Financial Reporting Standards (IFRS)
For the quarter ended September 30, 2020
Revenues were $3,312 million, growth of 3.2% YoY and 6.1% QoQ
Operating profit was $840 million, growth of 20.7% YoY and 18.7% QoQ
Basic EPS was $0.15, growth of 14.9% YoY and 17.0% QoQ
For six months ended September 30, 2020
Revenues were $6,433 million, growth of 1.5% YoY
Operating profit was $1,547 million, growth of 15.6% YoY
Basic EPS was $0.29, growth of 9.5% YoY
"The strength and resilience of Infosys was fully visible in Q2 with operating metrics witnessing a healthy increase, broad-based growth,
highest ever large deal TCV at $ 3.15 bn and attrition reducing to single digits," said Pravin Rao, COO. "Employees have been critical part
of our success. As a recognition of their stellar performance, we are giving 100% variable pay along with a special incentive for Q2.
Additionally, we are rolling out salary increases and promotions across all levels effective Jan 1st."
"Our relentless efforts on cost optimization and strengthening operational efficiencies helped by certain cost deferrals led to 270 bps
sequential improvement in operating margin to 25.4% and a 300 bps improvement in H1 margins," said Nilanjan Roy, CFO. "Free Cash Flows grew
significantly in H1 driven by our consistent focus on liquidity and cash management. Consequently, we are increasing our interim dividend
per share by 50% to INR 12."
2. Client wins & Testimonials
Even amid global uncertainty across industries and the current medical situation, Infosys continued to nurture a culture of deep client
relevance while building capabilities to aid them through recovery.
- Among several milestones achieved in the second quarter, Consolidated Edison Company (Con Edison), one of the oldest Fortune 500 utility
companies, selected Infosys to digitally transform Con Edison's customer service capabilities over the next four years
- Infosys collaborated with LANXESS, a leading specialty chemicals company headquartered in Cologne, Germany, to support the company's IT
Infrastructure digitization strategy and enable its global workforce with a secure and fully managed modern workplace
- Essential Utilities, one of the largest publicly traded water, wastewater and natural gas providers in the U.S., selected Infosys as a
strategic partner to drive its digital transformation
- Infosys has entered into a first-of-its-kind, 360 degree partnership with LivePerson, a leader in conversational AI, headquartered in New
York, to transform their infrastructure on the public cloud that will deliver industry-leading agility, scalability, and security. Infosys
will also help drive penetration of LivePerson's offerings across its clients and digital marketing, e-commerce, contact center, employee
engagement and shared services channels.
- Old National Bancorp (ONB), the largest financial services bank holding company headquartered in Indiana, U.S., wanted Infosys to enable
faster adoption of digital solutions, modernize ONB's existing technology infrastructure, and enhance both the client and employee
experience
- The National Bank of Bahrain (NBB) selected Infosys Finacle for the digital transformation of its transaction banking business
As global businesses navigate this tough environment, the strength of our relationships and our digital capabilities have helped us sustain
the momentum to help our clients grow resilient. Here is what some of them have to say:
- "We have worked with the Infosys team for over 5 years now, and very successfully. The results were phenomenal. My finance team and the
senior Enterprise leadership team couldn't believe how far the guys have gone above and beyond the contract. I am so delighted with the
results, delighted with the service that I have received. When the pandemic hit, we had to shut down and lock down both onshore and offshore
teams. Thanks to the RPA bots, we were able to issue every single order and we didn't miss a single KPI. Without those bots, we would have
been stranded. I can't speak highly enough of the guys involved and the actual tool itself. Superstars one and all." - Brad Monks, Head of
Mobile, BT Enterprise
- Kai Finke, CIO of LANXESS said, "Standardized and harmonized workplace services will enable us to increase our service quality and
usability on a global basis as well as increase flexibility and scalability which nowadays are getting more and more important. Working with
Infosys will allow us to implement state-of-the-art-technologies faster and thus bring LANXESS to the next level regarding workplace
services enhancing our collaboration and mobility capabilities."
Awards & Recognitions
- Positioned as a leader in Everest PEAK: Cloud-Native Application Development Services PEAK Matrix(R) Assessment 2020
- Ranked as a leader in NelsonHall NEAT for Quality Engineering Services 2020
- Ranked as a leader by NelsonHall NEAT for Advanced Digital Workplace Services 2020
- Positioned as a leader in HFS Research Top 10 for Travel, Hospitality, and Logistics Service Providers
- Ranked as a leader in Gartner Magic Quadrant for IT Services for Communications Service Providers, Worldwide
- Ranked as a leader in IDC MarketScape: Asia /Pacific SAP Implementation Services Vendor Assessment, 2020
- Positioned as a leader in IDC - MarketScape: Worldwide Manufacturing Intelligence Transformation Strategic Consulting 2020 Vendor
Assessment
- Positioned as a leader in IDC - MarketScape: Worldwide Manufacturing Intelligence Transformation 2020 Vendor Assessment
- Positioned as a leader in Forrester Wave: Digital Process Automation Service Providers
- Ranked as a leader CapioIT - Salesforce.com Global Systems Integration and Services Providers Capture Share Report – 2020
- Infosys is a winner of the 2020 Top 10 Working Mother & Avtar Best Company for Women in India award
- Infosys has won the Champion of Inclusion' award of Working Mother & Avtar Most Inclusive Companies Index (MICI) 2020
- Infosys Dusseldorf innovation hub was awarded with the prestigious NRW.INVEST award 2020
- Infosys won the German Brand Award 2020 for Excellence in Brand Strategy and Creation
- Recognized by the Top Employers Institute, a global certification company, for exceptional standards in employee conditions across Europe
for three years in a row. Infosys is also the certified Top Employer in France, Germany, Switzerland, The Netherlands and the United Kingdom
- Infosys Finacle was positioned as a leader in The Forrester Wave(TM): Digital Banking Processing Platforms (Corporate Banking), Q3 2020
report
- Infosys Finacle was ranked as a Leader in Gartner's Magic Quadrant for Global Retail Core Banking report 2020 for the 13th consecutive
year
About Infosys
Infosys is a global leader in next-generation digital services and consulting. We enable clients in 46 countries to navigate their digital
transformation. With nearly four 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 www.infosys.com to see how Infosys (NYSE: INFY) can help your enterprise navigate your next.
Safe Harbor
Certain statements in this release concerning our future growth prospects, financial expectations and plans for navigating the COVID-19
impact on our employees, clients and stakeholders are forward-looking statements intended to qualify for the 'safe harbor' under the Private
Securities Litigation Reform Act of 1995, which involve a number of risks and uncertainties that could cause actual results to differ
materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not
limited to, risks and uncertainties regarding COVID-19 and the effects of government and other measures seeking to contain its spread, risks
related to an economic downturn or recession in India, the United States and other countries around the world, changes in political,
business, and economic conditions, fluctuations in earnings, fluctuations in foreign exchange rates, our ability to manage growth, intense
competition in IT services including those factors which may affect our cost advantage, wage increases in India, our ability to attract and
retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions
on immigration, industry segment concentration, our ability to manage our international operations, reduced demand for technology in our key
focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential
acquisitions, liability for damages on our service contracts, the success of the companies in which Infosys has made strategic investments,
withdrawal or expiration of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising
capital or acquiring companies outside India, unauthorized use of our intellectual property and general economic conditions affecting our
industry and the outcome of pending litigation and government investigation. Additional risks that could affect our future operating results
are more fully described in our United States Securities and Exchange Commission filings including our Annual Report on Form 20-F for the
fiscal year ended March 31, 2020. These filings are available at www.sec.gov. Infosys may, from time to time, make additional written and
oral forward-looking statements, including statements contained in the Company's filings with the Securities and Exchange Commission and our
reports to shareholders. The Company does not undertake to update any forward-looking statements that may be made from time to time by or on
behalf of the Company unless it is required by law.
Infosys Limited and subsidiaries
Extracted from the Condensed Consolidated Balance Sheet under IFRS as at: (Dollars in millions)
September 30, 2020 March 31, 2020
ASSETS
Current assets
Cash and cash equivalents 3,038 2,465
Current investments 488 615
Trade receivables 2,430 2,443
Unbilled revenue 1,030 941
Other Current assets 785 748
Total current assets 7,771 7,212
Non-current assets
Property, plant and equipment and Right-of-use assets 2,438 2,361
Goodwill and other Intangible assets 964 950
Non-current investments 1,051 547
Other non-current assets 1,139 1,190
Total non-current assets 5,592 5,048
Total assets 13,363 12,260
LIABILITIES AND EQUITY
Current liabilities
Trade payables 322 377
Unearned revenue 455 395
Employee benefit obligations 263 242
Other current liabilities and provisions 1,764 1,743
Total current liabilities 2,804 2,757
Non-current liabilities
Lease liabilities 551 530
Other non-current liabilities 325 272
Total non-current liabilities 876 802
Total liabilities 3,680 3,559
Total equity attributable to equity holders of the company 9,623 8,646
Non-controlling interests 60 55
Total equity 9,683 8,701
Total liabilities and equity 13,363 12,260
Extracted from the Condensed Consolidated statement of Comprehensive Income under IFRS for:
(Dollars in millions except per equity share data)
3 months ended September 30, 2020 3 months ended September 30, 2019 6 months ended September 30, 2020 6 months ended September 30, 2019
Revenues 3,312 3,210 6,433 6,340
Cost of sales 2,125 2,140 4,196 4,261
Gross profit 1,187 1,070 2,237 2,079
Operating expenses:
Selling and marketing expenses 153 165 305 333
Administrative expenses 194 209 385 408
Total operating expenses 347 374 690 741
Operating profit 840 696 1,547 1,338
Other income, net (3) 70 83 128 183
Profit before income taxes 910 779 1,675 1,521
Income tax expense 255 207 456 403
Net profit (before minority interest) 655 572 1,219 1,118
Net profit (after minority interest) 653 569 1,212 1,115
Basic EPS ($) 0.15 0.13 0.29 0.26
Diluted EPS ($) 0.15 0.13 0.29 0.26
NOTES:
1. The above information is extracted from the audited condensed consolidated Balance sheet and Statement of Comprehensive Income for the
quarter and half year ended September 30, 2020 which have been taken on record at the Board meeting held on October 14, 2020.
2. A Fact Sheet providing the operating metrics of the Company can be downloaded from www.infosys.com .
3. Other Income includes Finance Cost.
IFRS-INR Press Release:
https://www.infosys.com/investors/reports-filings/quarterly-results/2020-2021/q2/documents/ifrs-inr-press-release.pdf
Fact Sheet: https://www.infosys.com/investors/reports-filings/quarterly-results/2020-2021/q2/documents/fact-sheet.pdf
Logo: https://mma.prnewswire.com/media/633365/Infosys_Logo.jpg
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