Infosys Technologies Ltd. (NASDAQ:INFY):
Highlights
Consolidated results for the quarter ended March 31, 2007
-- Fourth quarter revenues at $863 million, up by 45.5% from the
corresponding quarter last fiscal
-- Earnings per American Depository Share (ADS)(a) increased to
$0.46 from $0.28 in the corresponding quarter last fiscal; YoY
growth of 64.3%
-- 34 new clients were added during the quarter by Infosys and
its subsidiaries
-- Gross addition of 5,992 employees (net 2,809) for the quarter
by Infosys and its subsidiaries
-- 72,241 employees as on March 31, 2007 for Infosys and its
subsidiaries
(a) The tax provision for quarter ended March 31, 2007 and fiscal
2007 includes a tax reversal of $29 million. Excluding this the
earnings per share for the quarter and year ended March 31, 2007 would
have been $0.41 and $1.48 resulting in a YOY growth of 46% and 45%
respectively.
Senior Management Changes (Effective June 22, 2007)
-- Mr. Nandan M. Nilekani becomes the Co-Chairman of the Board
-- Mr. S. Gopalakrishnan assumes the role of Chief Executive
Officer and Managing Director
-- Mr. S. D. Shibulal assumes the role of Chief Operating Officer
of the company
Outlook for the Quarter Ending June 30, 2007 and Fiscal 2008
Quarter ending June 30, 2007
-- Consolidated revenues are expected to be between $904 million
and $908 million; YoY growth of 37.0% - 37.6%
-- Consolidated earnings per ADS expected to be $0.41; YoY growth
of 28.2%
Fiscal year ending March 31, 2008
-- Consolidated revenues are expected to be in the range of
$3,953 million and $4,016 million; YoY growth of 28.0% - 30.0%
-- Consolidated earnings per ADS(b) expected to be between $1.86
and $1.89; YoY growth of 25.7% - 27.7%
(b) Excluding tax reversal of $29 million in fiscal 2007
"Our revenues grew by around US$1 billion this year," said Nandan
M. Nilekani, CEO and Managing Director. "The global IT services
industry continues to show strong growth with exciting opportunities
and Infosys is well positioned to take advantage of this."
As businesses the world over sought to become more competitive,
Infosys offered strategic technology solutions and business insights
to help companies in leading industry verticals shift their
operational priorities and win in an increasingly 'flat' business
world.
In the Retail sector, Infosys won a large project for integrating
the PeopleSoft Human Capital Management (HCM) systems of the third
largest broadline retailer in the US. The integrated system will
enable the client to manage HR, payroll and benefits data effectively.
An upscale retailer providing quality discounted merchandise in
over 1,300 stores across 47 US states turned to Infosys for a scalable
solution to extend its custom Performance Management application to a
larger employee base. The automated solution has halved the time spent
on generating performance scores and computing employee compensation.
Infosys implemented a new order management system for the world's
largest employee-owned photography company that will significantly
reduce possible financial leakage.
In the High-tech Manufacturing sector, one of the world's largest
IT management software providers is working with Infosys to integrate
technical support functions across its recent acquisitions. Infosys'
integrated performance management and compensation solution for a top
independent software vendor will enable the company to streamline
employee rewards, ratings and assessment while helping its employees
and managers enjoy a better user experience.
Infosys made deeper inroads in the Energy sector. A leading
oilfield services company supplying technologies, project management
and performance optimization solutions to the international oil and
gas industry has approached Infosys to establish a strategic program
to improve the efficiency of its sales force.
Industry leaders in various sectors are using Infosys' Independent
Validation Services to boost the predictability of their applications.
A leading specialty beverage brand chose Infosys to build a Testing
Center of Excellence (TCOE), which brought all its testing activities
-- including automation and performance testing -- under a single
umbrella. The global leader in digital signal processing and analog
technologies partnered with Infosys to achieve test automation for
in-house applications, saving up to 10% of investment on IT projects
and achieving faster time to market.
"The rupee appreciated against all major currencies during the
quarter," said V. Balakrishnan, Chief Financial Officer. "Our robust
financial model allows us to balance the investments required in the
business and profitability while focusing on growth. Our liquidity
position continues to be strong with cash and cash equivalents
reaching US$1.4 billion."
About the Company
Infosys Technologies Ltd. (NASDAQ:INFY) defines, designs and
delivers IT-enabled business solutions that help Global 2000 companies
win in a flat world. These solutions focus on providing strategic
differentiation and operational superiority to clients. Infosys
creates these solutions for its clients by leveraging its domain and
business expertise along with a complete range of services. With
Infosys, clients are assured of a transparent business partner,
world-class processes, speed of execution and the power to stretch
their IT budget by leveraging the Global Delivery Model that Infosys
pioneered. Infosys has over 72,000 employees in over 39 offices
worldwide. Infosys is part of the NASDAQ-100 Index. For more
information, visit www.infosys.com.
Safe Harbor
Certain statements in this release concerning our future growth
prospects are forward-looking statements, within the meaning of
Section 27A of the U.S. Securities Act of 1933, as amended, and
Section 21E of the U.S. Securities Exchange Act of 1934, as amended,
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 the
success of our investments, risks and uncertainties regarding
fluctuations in earnings, our ability to manage growth, intense
competition in IT, business process outsourcing and consulting
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 of governmental fiscal incentives, political
instability and regional conflicts, legal restrictions on raising
capital or acquiring companies outside India, and unauthorized use of
our intellectual property and general economic conditions affecting
our industry.
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, 2006, our Quarterly Reports on Form 6-K
for the quarters ended June 30, 2006, September 30, 2006 and December
31, 2006 and our other recent filings. 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.
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Infosys Technologies Limited and subsidiaries
Unaudited Consolidated Balance Sheets
(Dollars in millions except per share data)
As of
March 31, March 31,
2006 2007
--------------------------
(1)
ASSETS
Current Assets
Cash and cash equivalents $889 $1,403
Investments in liquid mutual fund units 170 6
Trade accounts receivable, net of allowances 361 565
Unbilled revenue 48 74
Prepaid expenses and other current assets 40 50
Deferred tax assets 1 2
--------------------------
Total current assets 1,509 2,100
Property, plant and equipment, net 491 738
Goodwill 8 128
Intangible assets, net -- 20
Deferred tax assets 13 19
Advance income taxes 18 33
Other assets 27 35
--------------------------
Total Assets $2,066 $3,073
--------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $3 $6
Income taxes payable -- 4
Client deposits 2 1
Unearned revenue 44 72
Other accrued liabilities 160 274
--------------------------
Total current liabilities 209 357
Non-current liabilities
Other non-current liabilities 5 1
Minority interests 15 -
Stockholders' Equity
Common stock, $ 0.16 par value 600,000,000
equity shares authorized, Issued and
outstanding - 551,109,960 and 571,209,862
as of March 31, 2006 and March 31, 2007,
respectively 31 64
Additional paid-in capital 410 692
Accumulated other comprehensive income 9 88
Retained earnings 1,387 1,871
--------------------------
Total stockholders' equity 1,837 2,715
--------------------------
Total Liabilities And Stockholders' Equity $2,066 $3,073
--------------------------
(1) March 31, 2006 balances were obtained from audited financial
statements
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Infosys Technologies Limited and subsidiaries
Unaudited Consolidated Statements of Income
(Dollars in millions except per share data)
Three months ended Year ended March 31,
March 31,
------------------------- -------------------------
2006
2006 2007 (Audited) 2007
------------ ------------ ------------ ------------
Revenues $593 $863 $2,152 $3,090
Cost of revenues 354 497 1,244 1,777
------------ ------------ ------------ ------------
Gross profit 239 366 908 1,313
------------ ------------ ------------ ------------
Operating
Expenses:
Selling and
marketing
expenses 34 62 136 209
General and
administrative
expenses 49 66 173 249
Amortization of
intangible assets - 1 -- 3
------------ ------------ ------------ ------------
Total operating
expenses 83 129 309 461
------------ ------------ ------------ ------------
Operating income 156 237 599 852
Gain on sale of
long term
investment - - -- 1
Other income, net 16 28 31 83
------------ ------------ ------------ ------------
Income before
income taxes and
minority interest 172 265 630 936
Provision for
income taxes 18 6 70 84
------------ ------------ ------------ ------------
Income before
minority interest $154 $259 $560 $852
Minority interest 2 - 5 2
------------ ------------ ------------ ------------
Net income $152 $259 $555 $850
------------ ------------ ------------ ------------
Earnings per
equity share(c)
Basic $0.28 $0.46 $1.02 $1.53
Diluted $0.27 $0.45 $0.99 $1.50
Weighted average
equity shares
used in computing
earnings per
equity share(c)
Basic 547,386,214 559,944,338 543,160,222 554,018,739
Diluted 561,264,860 569,893,498 557,967,786 566,110,582
(c) Adjusted for stock split
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