IT Services Segment Dollar Revenue was above
the upper end of the guidance range
Board of Directors approved a buyback
proposal of Rs 110,000 million
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today
announced financial results under International Financial Reporting
Standards (IFRS) for its quarter ended June 30, 2017.
Highlights of the
Results
- Gross Revenues of Wipro Limited were Rs
136.3 billion ($2.1 billion1), an increase of 0.2% YoY.
- IT Services Segment Revenues in dollar
terms were $1,971.7 million, a sequential increase of 0.9%
(Non-GAAP constant currency increase of 0.3% sequentially) and 2.1%
YoY (Non-GAAP constant currency increase of 3.4% YoY).
- IT Services Segment Profits2 were Rs
21.9 billion ($339 million1), a decrease of 5.8% YoY.
- IT Services Margins for the quarter was
16.8%.
- Net Income3 for the quarter was Rs 20.8
billion ($321 million1), an increase of 1.2% YoY.
- Board approves Buyback proposal of Rs
110,000 million ($1.7 billion1) at a buyback price of Rs 320
($4.951).
Performance for the quarter ended June
30, 2017
“We delivered revenues above the upper end of the guidance
range. Our focus on Digital combined with our investments in client
mining have resulted in strong growth in Top accounts,” said
Abidali Z. Neemuchwala, Chief Executive Officer and Member of the
Board. “The brand refresh is reflective of the transformation
we are driving at Wipro and how we are helping our customers in
their digital journeys.”
“The impact on operating margins by rupee appreciation and
salary increases was partially offset by strong business
efficiencies. We continue to sustain robust cash generation,”
said Jatin Dalal, Chief Financial Officer. “The announcement
to buyback equity shares is part of our philosophy to deliver
efficient returns to shareholders.”
Outlook for the Quarter ending
September 30, 2017
We expect Revenues from our IT Services business to be in the
range of $1,962 million to $2,001 million*.
* Guidance is based on the following exchange rates: GBP/USD at
1.29, Euro/USD at 1.11, AUD/USD at 0.75, USD/INR at 64.46 and
USD/CAD at 1.33.
- For the convenience of the reader, the
amounts in Indian Rupees in this release have been translated into
United States Dollars at the noon buying rate in New York City on
June 30, 2017, for cable transfers in Indian Rupees, as certified
by the Federal Reserve Board of New York, which was US $1= Rs
64.62. However, the realized exchange rate in our IT Services
business segment for the quarter ended June 30, 2017 was US$1= Rs
66.06
- Segment Profit refers to Segment
Results Total.
- Net Income refers to ‘Profit for the
period attributable to equity holders of the Company’
Capital Allocation
- The Board of Directors approved a
buyback proposal, subject to the approval of shareholders through
postal ballot, for purchase by the company of up to 343.75 million
equity shares of Rs 2 each (representing 7.06% of total equity
capital) from the shareholders of the company on a proportionate
basis by way of a tender offer. The buyback price will be Rs 320
($4.95)1 per equity share payable in cash for an aggregate amount
not exceeding Rs 110,000 million ($1.7 billion)1 in accordance with
the provisions of Companies Act, 2013 and the SEBI (Buy Back of
Securities) Regulations, 1998 (Buyback Regulations). Additional
information regarding the terms and conditions of the buyback will
be disclosed in due course in accordance with Buyback
Regulations.
- Further to the announcement on April
25, 2017, the Company, during the quarter ended June 30, 2017,
allotted Bonus equity shares of Rs 2/- each in the ratio of 1:1
(one bonus share for every one share held) to the shareholders of
the Company who were on the Register of Members of the Company as
on June 14, 2017, which was the Record Date fixed by the Board of
the Directors of the Company for this purpose.
IT Services
Wipro continues its momentum in winning large deals globally as
described below:
Wipro has won a multi-year engagement with a large utility
company in the United States to deliver data center, disaster
recovery, service desk and end user services. This program will
drive greater automation and improve services to end customers
through the use of analytics and the Wipro HOLMES Artificial
Intelligence PlatformTM.
Wipro has won a multi-year contract from a Europe-headquartered
oil and gas major to transform their IT infrastructure and security
platform. Wipro will support the client in the design and
development of a business-aligned IT backbone that will form the
foundation of their digitization strategy.
Wipro has won a multi-year digital transformation deal to
automate and digitize the ‘Order to Entitlement’ operations for a
global technology company, headquartered in North America.
Leveraging proprietary technology such as the Wipro HOLMES
Artificial Intelligence PlatformTM, Data Discovery Platform for
analytics and Wipro BASE)))TM, Wipro will implement process
digitization, drive process efficiencies and improve customer
experience for the client.
Wipro has won a five-year engagement with a global
pharmaceutical major to provide service desk and end-user computing
services, across locations. The project, which will leverage Wipro
HOLMES Artificial Intelligence PlatformTM and includes a unique
hyper-personalization initiative, will improve productivity and
significantly enhance user experience at the client
organization.
A large North American insurer has awarded an IT infrastructure
contract to Wipro. Wipro will provide data center services and
Enterprise Command Center services that will manage a wide range of
IT operations for the client.
Wipro has won a multi-year managed services engagement with a
key IT delivery arm of the Government of India (GoI). The program
will enable GoI to effectively regulate and monitor e-governance
transactions and the implementation of central government sponsored
schemes at the grass-roots level.
A large state in South India has chosen Wipro to implement IT
network infrastructure across 30 districts in the state, as part of
the “State Wide Area Network 2.0’ project.
A leading telecom major, as part of their managed services
engagement renewal, has chosen Wipro for transforming their
operations, which includes process simplification and robotic
process automation. The program will improve the telecom company’s
agility to launch new services, and will help them provide an
enhanced customer experience in addition to facilitating process
and cost optimization.
Digital highlights
Wipro will help an American IT company develop enterprise-grade
distributed ledger blockchain solutions. As part of this
engagement, Wipro will build an Ethereum-based test bed for
scalability and performance testing, and a user interface for smart
contracts applications.
Wipro has been selected by a global logistics company to set up
a joint innovation center that will reimagine the customer’s
digital journey. We will start the innovation journey by
introducing next generation mobility solutions that the client’s
associates and freight drivers will use for pickups and deliveries.
Over the next couple of years, we will work through and bring to
fruition a number of process transformation ideas.
The Latin American entity of one of the largest U.S. Banks has
chosen Wipro as their strategic partner to significantly change how
it delivers new products and services and integrates with its
partner eco-system at a greater speed. Wipro will set up and run an
API and Microservices factory as part of their digital
transformation journey. Wipro will set up multiple agile teams,
bring in two-speed delivery model and complete the work in an
output-based model for the bank.
Clix Capital Services Pvt. Ltd. has selected Wipro as the
primary technology partner to help design, build and maintain their
digital channels and digital infrastructure that will connect to
underlying transaction systems and provide infrastructure on a
cloud model. This engagement is for a term of 5 years.
A few of the notable wins in Cloud Applications leveraging our
Appirio cloud services are as follows:
- A diversified financial services
company has chosen Wipro to implement its new cloud-based sales and
service transformation program. This follows the successful
completion of a comprehensive strategy assessment by Appirio.
- A global storage firm has selected
Wipro to deploy their Quote-to-Cash, Field Service and Service
Management processes.
- A global pharmaceutical organization
has selected Wipro to transform their “Quote-to-Cash”
processes.
- Wipro has been chosen as a partner to
digitize the go-to-market processes of a marquee sales consulting
firm.
- One of the world’s leading
biotherapeutics organizations has selected Wipro to reimagine their
worker experience processes.
Delivery Excellence
Backed by a proven track record in enabling banking technology
in India, Wipro enabled the successful roll-out of PayTM Payment
Bank’s digital banking operations in May 2017.
“Wipro was selected from a strategic partner perspective and
what we saw in Wipro was the ability to grab hold of what we were
trying to transform. The solution was an end-to-end integrated
service across all service towers being IT, Finance and Customer
Service. That was critical for us to drive the globalization and
the productivity that we felt we could accomplish by bringing these
groups together,” said Tim Wightman, Vice President -
Application & Technology Services, Levi Strauss &
Co.
“Wipro is a trusted partner and a safe pair of hands who have
supported Nisa’s business over a decade with its Oracle Retail
Solutions,” said Peter Walker, Head of Business Systems, Nisa
Retail. “The Wipro relationship has allowed us to remain
reactive and meet any industry challenges that have been thrown at
us, the close working relationship to our business has been very
beneficial to us and ensured that when new opportunities arise we
can deliver solutions in a timely manner.”
Awards and accolades
Wipro has been named an IDC Health Insights HealthTech Rankings
Enterprise 25 Company. The rankings categorize and evaluate global
providers of information technology to healthcare payers and
providers.
IDC named Wipro as a “Leader” in the IDC MarketScape: Worldwide
Digital Transformation Consulting and Systems Integration Service
Providers 2017 Vendor Assessment (doc #US41523517, June 2017). The
report recommended end users to consider Wipro when looking for
Artificial intelligence–enabled automation and human-centric design
approach for digital transformation in their businesses.
Wipro was recognized as a “Leader” in the first ever Everest
Group PEAK Matrix™ assessment on IT Infrastructure automation.
Everest Group said that Wipro enjoys an early mover advantage in
the overall services automation space with its HOLMES platform.
Wipro’s strong experience in the workplace and cloud services space
has helped build a credible automation suite targeting these
service areas.
Wipro was named as a Leader in the IDC MarketScape: Worldwide
Finance and Accounting BPO Services 2017 Vendor Assessment (doc
#US41237717, June 2017). The IDC MarketScape said that Wipro is
perceived as very competent in its industry, technical, and
functional capabilities, with industry-specific breadth and depth
of F&A business process services.
IT Products
- Revenue for the quarter ended June 30,
2017 was Rs 6.3 billion ($98 million1), an increase of 7% YoY.
Please refer to the tables at the end for reconciliation between
IFRS IT Services Revenue and IT Services Revenue on a non-GAAP
constant currency basis.
About Non-GAAP financial measures
This press release contains non-GAAP financial measures within
the meaning of Regulation G and Item 10(e) of Regulation S-K. Such
non-GAAP financial measures are measures of our historical or
future performance, financial position or cash flows that are
adjusted to exclude or include amounts that are excluded or
included, as the case may be, from the most directly comparable
financial measure calculated and presented in accordance with
IFRS.
The table at the end of the release provides IT Services Revenue
on a constant currency basis, which is a non-GAAP financial measure
that is calculated by translating IT Services Revenue from the
current reporting period into U.S. dollars based on the currency
conversion rate in effect for the prior reporting period. We refer
to growth rates in constant currency so that business results may
be viewed without the impact of fluctuations in foreign currency
exchange rates, thereby facilitating period-to-period comparisons
of our business performance.
This non-GAAP financial measure is not based on any
comprehensive set of accounting rules or principles and should not
be considered a substitute for, or superior to, the most directly
comparable financial measure calculated in accordance with IFRS,
and may be different from non-GAAP measures used by other
companies. In addition to this non-GAAP measure, the financial
statements prepared in accordance with IFRS and the reconciliation
of these non-GAAP financial measures with the most directly
comparable IFRS financial measure should be carefully
evaluated.
Results for the quarter ended June 30, 2017, prepared under
IFRS, along with individual business segment reports, are available
in the Investors section of our website
www.wipro.com.
Quarterly Conference Call
We will hold an earnings conference call today at 07:15 p.m.
Indian Standard Time (09:45 a.m. U.S. Eastern Time) to discuss our
performance for the quarter. The audio from the conference call
will be available online through a web-cast and can be accessed at
the following link-
http://services.choruscall.eu/links/wipro170720.html
An audio recording of the management discussions and the
question and answer session will be available online and will be
accessible in the Investor Relations section of our website at
www.wipro.com.
All product names, logos, and brands are property of their
respective owners.
About Wipro Limited
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) is a leading
global information technology, consulting and business process
services company. We harness the power of cognitive computing,
hyper-automation, robotics, cloud, analytics and emerging
technologies to help our clients adapt to the digital world and
make them successful. A company recognized globally for its
comprehensive portfolio of services, strong commitment to
sustainability and good corporate citizenship, we have over 160,000
dedicated employees serving clients across six continents.
Together, we discover ideas and connect the dots to build a better
and a bold new future.
Forward-looking statements
The forward-looking statements contained herein represent
Wipro’s beliefs regarding future events, many of which are by their
nature, inherently uncertain and outside Wipro’s control. Such
statements include, but are not limited to, statements regarding
Wipro’s growth prospects, its future financial operating results,
and its plans, expectations and intentions. Wipro cautions readers
that the forward-looking statements contained herein are subject to
risks and uncertainties that could cause actual results to differ
materially from the results anticipated by such statements. Such
risks and uncertainties include, but are not limited to, risks and
uncertainties regarding fluctuations in our earnings, revenue and
profits, our ability to generate and manage growth, complete
proposed corporate actions, intense competition in IT services, our
ability to maintain 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, our ability to
manage our international operations, reduced demand for technology
in our key focus areas, disruptions in telecommunication networks,
our ability to successfully complete and integrate potential
acquisitions, liability for damages on our service contracts, the
success of the companies in which we make strategic investments,
withdrawal of fiscal governmental incentives, political
instability, war, legal restrictions on raising capital or
acquiring companies outside India, unauthorized use of our
intellectual property and general economic conditions affecting our
business and industry. Additional risks that could affect our
future operating results are more fully described in our filings
with the United States Securities and Exchange Commission,
including, but not limited to, Annual Reports on Form 20-F. These
filings are available at www.sec.gov. We 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.
We do not undertake to update any forward-looking statement that
may be made from time to time by us or on our behalf.
Wipro limited and subsidiaries CONDENSED CONSOLIDATED
INTERIM STATEMENT OF FINANCIAL POSITION (Rupees in millions, except
share and per share data, unless otherwise stated)
As of March 31, As of June
30, 2017 2017 2017
Conveniencetranslation into
USdollar in millions(unaudited) - Referto
footnote 1
ASSETS
Goodwill 125,796 126,488 1,957 Intangible assets 15,922 15,518 240
Property, plant and equipment 69,794 71,023 1,099 Derivative assets
106 497 8 Investments 7,103 9,769 151 Investment in equity
accounted investee 353 5 Trade receivables 3,998 3,998 62
Non-current tax assets 12,008 14,585 226 Deferred tax assets 3,098
3,930 61 Other non-current assets 16,793 19,172 297
Total
non-current assets 254,618 265,333 4,106 Inventories
3,915 3,434 53 Trade receivables 94,846 97,954 1,516 Other current
assets 30,751 31,571 489 Unbilled revenues 45,095 46,509 720
Investments 292,030 317,718 4,917 Current tax assets 9,804 8,526
132 Derivative assets 9,747 5,233 81 Cash and cash equivalents
52,710 54,317 841
Total current assets 538,898 565,262 8,749
TOTAL ASSETS 793,516 830,595 12,855
EQUITY
Share capital 4,861 9,731 151 Share premium 469 2,043 32 Retained
earnings 490,930 506,940 7,844 Share based payment reserve 3,555
2,151 33 Other components of equity 20,489 19,850 307 Equity
attributable to the equity holders of the Company 520,304 540,715
8,367 Non-controlling interest 2,391 2,439 38
Total equity
522,695 543,154 8,405
LIABILITIES
Long - term loans and borrowings 19,611 32,487 503 Deferred tax
liabilities 6,614 7,630 118 Derivative liabilities 2 - -
Non-current tax liabilities 9,547 8,545 132 Other non-current
liabilities 5,500 4,429 69 Provisions 4 2 -
Total non-current
liabilities 41,278 53,093 822 Loans, borrowings and bank
overdrafts 122,801 113,712 1,760 Trade payables and accrued
expenses 65,486 73,905 1,146 Unearned revenues 16,150 15,921 246
Current tax liabilities 8,101 12,083 187 Derivative liabilities
2,708 2,626 41 Other current liabilities 13,027 14,911 230
Provisions 1,270 1,190 18
Total current liabilities 229,543
234,348 3,628
TOTAL LIABILITIES 270,821 287,441 4,450
TOTAL EQUITY AND LIABILITIES 793,516 830,595
12,855
Wipro limited and subsidiaries CONDENSED
CONSOLIDATED INTERIM STATEMENTS OF INCOME (Rupees in millions,
except share and per share data, unless otherwise stated)
Three Months ended June 30, 2016
2017 2017
Conveniencetranslation into
USdollar in millions(unaudited) Referto
footnote 1
Gross revenues 135,992 136,261 2,109 Cost of revenues (96,389 )
(97,111 ) (1,503 )
Gross profit 39,603 39,150
606 Selling and marketing expenses (10,141 ) (10,146
) (157 ) General and administrative expenses (7,599 ) (7,264 ) (112
) Foreign exchange gains/(losses), net 984 353 5
Results
from operating activities 22,847 22,093
342 Finance expenses (1,336 ) (1,474 ) (23 ) Finance
and other income 5,200 6,200 96 Share of profits/(loss) of equity
accounted investee (1 )
Profit before tax 26,711
26,818 415 Income tax expense (6,122 ) (5,994 ) (93 )
Profit for the period 20,589 20,824
322 Attributable to: Equity holders of
the company 20,518 20,765 321 Non-controlling interest 71 59
1
Profit for the period 22,073 20,824
322
Earnings per equity share:
Attributable to equity share holders of the company Basic
4.17 4.29 0.07 Diluted 4.16 4.28 0.07 Weighted average
number of equity shares used in computing earnings per equity share
Basic 4,914,727,772 4,845,115,238 4,845,115,238 Diluted
4,926,794,736 4,851,070,943 4,851,070,943
Additional
Information Segment Revenue IT Services Business
Units BFSI 33,630 34,934 541 HLS 19,928 19,150 296 CBU 20,725
20,535 318 ENU 17,356 17,464 270 MNT 29,538 29,342 454 COMM 9,911
8,831 137
IT SERVICES TOTAL 131,088
130,256 2,016 IT PRODUCTS 5,930 6,343 98 RECONCILING ITEMS (42 ) 15
- TOTAL 136,976 136,614 2,114
Segment Result IT Services Business Units BFSI
6,994 5,441 85 HLS 2,855 2,734 42 CBU 3,775 2,934 45 ENU 3,025
3,651 57 MNT 5,954 5,175 81 COMM 1,502 1,449 22 OTHERS - - -
UNALLOCATED (837 ) 532 8
TOTAL IT SERVICES
23,268 21,916 340 IT PRODUCTS (368 ) 31 - RECONCILING ITEMS (53 )
146 2 TOTAL 22,847 22,093 342
FINANCE EXPENSE (1,336 ) (1,474 ) (23 ) FINANCE AND OTHER INCOME
5,200 6,200 96 SHARE OF PROFIT/(LOSS) OF EQUITY ACCOUNTED INVESTEE
(1 ) - PROFIT BEFORE TAX 26,711 26,818 415 INCOME TAX
EXPENSE (6,122 ) (5,994 ) (93 )
PROFIT FOR THE PERIOD
20,589 20,824 322
Segment result represents operating profits of the segments and
dividend income and gains or losses (net) relating to strategic
investments, which are presented within “Finance and other income”
in the statement of Income.
The Company is organized by the following operating segments; IT
Services and IT Products.
The IT Services segment primarily consists of IT Service
offerings to customers organized by industry verticals. The
industry verticals are as follows: Banking,Financial Services and
Insurance (BFSI), Healthcare & Lifesciences (HLS), Consumer
Business Unit (CBU), Energy, Natural Resources & Utilities
(ENU), Manufacturing & Technology (MNT), Communications (COMM).
IT Services segment also includes Others which comprises dividend
income relating to strategic investments, which are presented
within “Finance and other income” in the statement of Income. Key
service offerings to customers includes software application
development and maintenance, research and development services for
hardware and software design, business application services,
analytics, consulting, infrastructure outsourcing services and
business process services. In the IT Products segment, the Company
is a value added reseller of desktops, servers, notebooks, storage
products, networking solutions and packaged software for leading
international brands. In certain total outsourcing contracts of the
IT Services segment, the Company delivers hardware products,
software licenses and other related deliverables.
Reconciliation of Non-GAAP Constant Currency IT
Services Revenue to IT Services Revenue as per IFRS
($MN) Three Months ended June 30,2017 IT Services
Revenue as per IFRS $ 1,971.7 IT Services
Revenue as per IFRS $ 1,971.7 Effect of Foreign
currency exchange movement $ (12.1 ) Effect of Foreign
currency exchange movement $ 24.2 Non-GAAP Constant Currency IT
Services Revenue based on previous quarter exchange rates
$ 1,959.6 Non-GAAP Constant Currency IT
Services Revenue based on previous year exchange rates
$ 1,995.9
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version on businesswire.com: http://www.businesswire.com/news/home/20170720005776/en/
Wipro LimitedInvestor RelationsPavan N Rao, +91-80-4672
6143pavan.rao@wipro.comorAbhishek Kumar Jain, +1 978 826
4700abhishekkumar.jain@wipro.comorMedia & PressVipin
Nair, +91-80-3991 6450vipin.nair1@wipro.com
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