WIT Wipro Ltd

Gross Revenues grew 7% YoY

Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for its third quarter ended December 31, 2015.

Highlights of the Results:

• Wipro Limited Gross Revenues were Rs 128.6 billion ($1.9 billion1), an increase of 7% YoY.
• IT Services Segment Non-GAAP constant currency Revenue in dollar terms grew 1.4% sequentially and grew 6.3% YoY. IT Services Segment Revenue was $1,838.3 million, a sequential increase of 0.3%.
• IT Services Segment Revenue was Rs 123.1 billion ($1,861 million1), an increase of 9% YoY.
• Net Income2 was Rs 22.3 billion ($338 million1), an increase of 2% YoY.
• IT Services Segment Profit3 was Rs 24.8 billion ($375 million1).
• IT Services Segment Margins was 20.2%.
• Headcount increased by 2,268 to 170,664.
• Wipro declared an interim dividend of Rs 5 ($0.08) per share /ADS.

Performance for the quarter ended December 31, 2015T K Kurien, Member of the Board & Chief Executive Officer of Wipro, said – “We delivered Revenues in line with our guidance. We saw a pick-up in large deal closures led by Global Infrastructure Services. It is becoming increasingly clear that customers want to simplify operations and optimize their IT spend while investing in Digital to transform their business. We are well-positioned to take advantage of this trend.”

Abidali Z. Neemuchwala, Chief Executive Officer-Designate of Wipro, said – “We are focused on driving market share growth in our core businesses through integrated domain and technology services, while investing for the future in building differentiated Digital capabilities. We will leverage our strong culture of innovation and extremely talented employee pool to build compelling value propositions for our customers.”

Jatin Dalal, Chief Financial Officer of Wipro, said – “During the quarter, we have built competitive differentiation through the acquisition of two high-potential companies – cellent and Viteos. The impact on revenues from the Chennai floods were minimized significantly by strong execution of our robust Business Continuity Plans (BCP). The additional expenses incurred in deploying BCP impacted operating margins for the quarter.”

Outlook for the Quarter ending March 31, 2016We expect Revenues from our IT Services business to be in the range of $ 1,875 million to $1,912 million*.

* Guidance is based on the following exchange rates: GBP/USD at 1.50, Euro/USD at 1.07, AUD/USD at 0.72, USD/INR at 66.13 and USD/CAD at 1.37

IT ServicesThe IT Services segment had a headcount of 170,664 as of December 31, 2015. We added 39 new customers during the quarter.

Effective January 1, 2016, Wipro completed the transaction announced on December 2, 2015 to acquire cellent AG, a leading IT consulting and software services company in the DACH region of Germany, Austria and Switzerland.

On December 23, 2015, Wipro announced that it has signed a definitive agreement to acquire Viteos Group, a BPaaS provider for the Alternative Investment Management Industry.

Wipro sustained its momentum in winning Large Deals globally as described below:

Wipro has entered into a multi-year global infrastructure support engagement with one of the largest medical devices companies in the world. Wipro will standardize and simplify the customer’s IT infrastructure across multiple service lines and in over 90 countries.

A leading global nutrition, health and wellness company has selected Wipro to enable the migration of a significant portion of its global IT applications estate to a hybrid cloud. As part of the engagement, Wipro will provide IaaS (Infrastructure as a Service), PaaS (Platform as a Service), an integrated hardware-software-services stack, and billing-metering-chargeback in a completely outcome-based model.

A large global retailer has selected Wipro as its quality engineering partner. Wipro will help develop a new operating and financial model that will allow the customer to accurately forecast its quality engineering spends and optimize costs, while driving continuous improvements in the quality and time-to-market of its offerings.

Wipro has won a large contract from a European general insurance multinational for provisioning and managing the company’s infrastructure.

A leading security solutions manufacturer, headquartered in the Nordic region, has selected Wipro to transform its IT infrastructure. As part of the five-year agreement, Wipro will leverage its Boundaryless Datacenter offering and will consolidate the customer’s existing data centers and implement a cloud-based-services model, including IaaS (Infrastructure as a Service) and PaaS (Platform as a Service).

An Australia-headquartered manufacturing sector customer has awarded a five-year strategic, IT-as-a-service contract to Wipro. Wipro will have the end-to-end responsibility of running the customer’s IT operations and enabling the transformation of the existing IT estate to a next-generation digital-ready landscape. The new consumption-based model will enable the customer to be more agile, reliable and competitive while launching new products and services.

Digital highlightsOur Digital capability combining design, engineering and analytics is seeing traction in the marketplace. Unique capabilities of Designit combined with Wipro’s technological prowess is driving synergistic deal wins.

Wipro has been selected to help a global bank establish and operate its new digital platform, across 50 markets. With global scale and a blend of strategy, design and engineering capabilities, Wipro’s agile teams will help support consistent customer experience, underpinned by continuous delivery across this new digital platform. Wipro will reinvent the onboarding process for customers, help improve sales conversion rates and reduce operational costs.

Wipro has won a multi-year deal from a large bank to enable omni-channel self-service by digitizing service processes and leveraging new age digital technologies. This will help the bank provide superior customer experience while reducing costs, in the form of lower call volumes.

Wipro will be augmenting the in-house team of a market leader in the automotive space, with telematics domain skills and advanced engineering expertise for their telematics program.

Designit has been selected by a leading South American bank to work on designing an entirely new banking concept and experience, targeted to create the next-generation banking experience for customers who are usually not attracted to traditional banking offerings anymore.

For a major German telecommunications brand, Designit has been assigned to create future smart Product-Service-Experiences using artificial intelligence and similar emerging technologies.

For a leading European energy provider, Designit has been selected to design an innovation process to better facilitate the company’s investments into technology start-ups and to effectively drive the integration of acquired start-ups into the client’s own organizational portfolio.

Cloud highlightsOur Cloud applications business is seeing a good traction in the market. In the quarter ending December 31, 2015 we engaged with several clients to design and deploy their enterprise processes leveraging industry leading SaaS products. A few marquee engagements include Cloud CRM processes rationalization for a UK-based gas and utility major, simplification of lead & opportunity management processes for a leading US based equipment rental company, modernization of a B2B order management system for a leading chemicals supplier company, design and deployment of recruitment processes for a business process outsourcing enterprise, implementation of performance and goal management processes for an American satellite service provider and transforming the source-to-pay process for an global pharmaceutical and consumer packaged goods major.

Wipro has also partnered with Apttus, the category-defining Quote-to-Cash cloud solution provider, to deliver best-in-class Contract Lifecycle Management (CLM), Configure-Price-Quote (CPQ) & Revenue Management solutions to clients across industries.

Awards and accoladesWipro continued to lead the ‘Global Engineering and R&D Service Providers (GSPR) Rating 2015’ by Zinnov Management Consulting for the sixth consecutive year. The Zinnov study evaluated more than 75 R&D service providers across the world in 15 major industry segments across key parameters like product development capabilities & innovation, client relationships, human capital, financials, ecosystem linkages, infrastructure, and business sustainability.

Wipro has been positioned as a "Leader" by Forrester Research Inc, in its report ‘The Forrester Wave™: Global Workplace Services, Q4 2015’. The report cites Wipro’s relative strength in infrastructure services delivery, well-balanced staff distribution across EMEA, North America and Asia Pacific, highest overall customer reference scores of any supplier evaluated in the analysis, strong customer value proposition, and compelling vision for workplace services.

Wipro has been positioned as a “Leader” in the IDC MarketScape: Worldwide Life Science Manufacturing and Supply Chain 2015 vendor assessment for services in all the 3 service categories of strategic consulting, ITO and BPO.

Wipro has been recognised as a “Leader” by leading global analyst firm Everest Group, in the Healthcare Payer Digital IT Services PEAK Matrix Assessment 2015. This reaffirms our growing capabilities in the Healthcare Digital space.

Wipro has also been featured as a “Star Performer” in the Everest Group Healthcare Provider IT Services PEAK Matrix Assessment 2015. This reflects Wipro’s large scale and deeper client relationships, technology capability and investments in tools, platforms, and a global delivery presence in the Healthcare Provider space.

Wipro has been recognised as a “Leader” in the Gartner Magic Quadrant for Application Testing Services, Worldwide for the second consecutive year.

Wipro has been positioned in the 'Winner's Circle' of HfS Blueprint Report on Trust-as-a-Service 2015. The report covers the market view of Digital Trust and Security Framework, the Digital Trust Maturity Scale, and the As-a-Service Economy.

Wipro has won 8 awards at the seventh Annual Golden Bridge Business and Innovation Awards Ceremony including the Grand Trophy Award for being the overall winner with maximum impact. Wipro was recognized for its innovations in API Management and Solutions, Information Technology (Software), Mobile Innovative Products or Services, Business Process Management and Application Development.

IT Products

• Our IT Products Segment delivered Revenue of Rs 6.5 billion ($98 million1) for the quarter ended December 31, 2015.

Please refer to the table on page 7 for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.

About Non-GAAP financial measuresThis 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 on page 7 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 December 31, 2015, prepared under IFRS, along with individual business segment reports, are available in the Investors section of our website www.wipro.com.

Quarterly Conference CallWe will hold an earnings conference call today at 11:00 a.m. Indian Standard Time (12:30 a.m. US Eastern Time) to discuss our performance for the quarter. 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.

About Wipro Limited (NYSE: WIT)Wipro Ltd. (NYSE:WIT) is a leading information technology, consulting and business process services company that delivers solutions to enable its clients to do business better. Wipro delivers winning business outcomes through its deep industry experience and a 360 degree view of "Business through Technology.” By combining digital strategy, customer centric design, advanced analytics and product engineering approach, Wipro helps its clients create successful and adaptive businesses. A company recognized globally for its comprehensive portfolio of services, strong commitment to sustainability and good corporate citizenship, Wipro has a dedicated workforce of over 160,000, serving clients in 175+ cities across 6 continents.

For more information, please visit www.wipro.com

Forward-looking statementsThe 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, 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 December 31, 2015 2015 2015    

Convenience translation into US dollar in millions (unaudited) - Refer footnote 1 on Page 1

ASSETS

Goodwill 68,078 75,361 1,139 Intangible assets 7,931 8,274 125 Property, plant and equipment 54,206 57,360 867 Derivative assets 736 237 4 Available for sale investments 3,867 4,391 66 Non-current tax assets 11,409 11,551 175 Deferred tax assets 2,945 3,850 58 Other non-current assets 14,369 13,718 207 Total non-current assets 163,541 174,742 2,641   Inventories 4,849 6,095 92 Trade receivables 91,531 99,959 1,510 Other current assets 73,359 97,751 1,477 Unbilled revenues 42,338 45,662 690 Available for sale investments 53,908 151,651 2,291 Current tax assets 6,490 8,371 126 Derivative assets 5,077 3,486 53 Cash and cash equivalents 158,940 89,973 1,359 Total current assets 436,492 502,948 7,598 TOTAL ASSETS 600,033 677,690 10,239  

EQUITY

Share capital 4,937 4,941 75 Share premium 14,031 14,532 220 Retained earnings 372,248 418,176 6,318 Share based payment reserve 1,312 1,950 29 Other components of equity 15,454 16,968 256 Equity attributable to the equity holders of the Company 407,982 456,567 6,898 Non-controlling interest 1,646 2,035 31 Total equity 409,628 458,602 6,929  

LIABILITIES

Long - term loans and borrowings 12,707 16,427 248 Deferred tax liabilities 3,240 3,379 51 Derivative liabilities 71 50 1 Non-current tax liabilities 6,695 7,397 112 Other non-current liabilities 3,658 7,296 110 Provisions 5 15 - Total non-current liabilities 26,376 34,564 522   Loans and borrowings and bank overdrafts 66,206 81,501 1,231 Trade payables and accrued expenses 58,745 61,918 935 Unearned revenues 16,549 19,122 289 Current tax liabilities 8,036 7,209 109 Derivative liabilities 753 908 14 Other current liabilities 12,223 12,622 191 Provisions 1,517 1,244 19 Total current liabilities 164,029 184,524 2,788 TOTAL LIABILITIES 190,405 219,088 3,310       TOTAL EQUITY AND LIABILITIES 600,033 677,690 10,239   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 December 31,   Nine months ended December 31,     2014   2015     2015   2014   2015     2015              

Convenience translation into US dollar in millions (unaudited)- Refer footnote 1 on Page 1

     

Convenience translation into USdollar in millions(unaudited) - Refer footnote 1 on Page 1

  Gross revenues 119,929 128,605 1,943 348,125 376,116 5,682 Cost of revenues (82,867 ) (90,270 ) (1,364 ) (238,675 ) (260,881 ) (3,941 ) Gross profit 37,062 38,335 579 109,450 115,235 1,741   Selling and marketing expenses (7,524 ) (8,362 ) (126 ) (22,709 ) (25,114 ) (379 ) General and administrative expenses (6,426 ) (7,010 ) (106 ) (19,217 ) (20,710 ) (313 ) Foreign exchange gains/(losses), net 922 911 14 3,343 2,774 42   Results from operating activities 24,034 23,874 361 70,867 72,185 1,091   Finance expenses (810 ) (1,423 ) (21 ) (2,687 ) (4,298 ) (65 ) Finance and other income 5,035 6,227 94 14,383 17,663 267 Profit before tax 28,259 28,678 434 82,563 85,550 1,293 Income tax expense   (6,228 ) (6,248 )   (95 ) (18,369 ) (18,679 )     (282 ) Profit for the period   22,031   22,430     339   64,194   66,871       1,011     Attributable to: Equity holders of the company 21,928 22,341 338 63,808 66,572 1,006 Non-controlling interest   103   89     1   386   299       5   Profit for the period   22,031   22,430     339   64,194   66,871       1,011       Earnings per equity share: Attributable to equity share holders of the company Basic 8.92 9.09 0.14 25.97 27.10 0.41 Diluted 8.88 9.07 0.14 25.85 27.05 0.41  

 

Weighted average number of equity shares used in computing earnings per equity share

Basic 2,457,766,859 2,457,022,905 2,457,022,905 2,457,491,867 2,456,551,992 2,456,551,992 Diluted 2,469,323,243 2,462,220,926 2,462,220,926 2,468,262,835 2,461,282,411 2,461,282,411   Additional Information Segment Revenue IT Services Business Units BFSI 29,177 32,322 489 85,653 95,595 1,444 HLS 13,247 14,719 222 36,713 41,453 626 RCTG 16,005 19,158 289 45,951 54,650 826 ENU 18,637 17,708 268 53,792 52,949 800 MFG 20,718 22,683 343 59,721 66,769 1,009 GMT   15,661   16,557     250   45,933   47,932       724   IT SERVICES TOTAL 113,445 123,147 1,861 327,763 359,348 5,429 IT PRODUCTS 7,740 6,503 98 24,552 20,119 304 RECONCILING ITEMS   (334 ) (134 )   (2 ) (847 ) (577 )     (9 ) TOTAL   120,851   129,516     1,957   351,468   378,890       5,724     Segment Result IT Services Business Units BFSI 7,035 7,199 109 19,904 21,147 320 HLS 2,981 3,188 48 7,534 8,991 136 RCTG 3,255 3,809 57 9,648 10,211 154 ENU 4,262 3,436 52 13,483 10,745 162 MFG 4,228 4,142 63 12,630 13,270 201 GMT 3,438 3,093 47 10,696 8,928 135 OTHERS - - - 583 - - UNALLOCATED   (458 ) (47 )   (1 ) (1,606 ) 759       11   TOTAL IT SERVICES 24,741 24,820 375 72,872 74,051 1,119 IT PRODUCTS 89 (505 ) (7 ) 316 (574 ) (9 ) RECONCILING ITEMS   (796 ) (441 )   (7 ) (2,321 ) (1,292 )     (19 ) TOTAL   24,034   23,874     361   70,867   72,185       1,091   FINANCE EXPENSE (810 ) (1,423 ) (22 ) (2,687 ) (4,298 ) (65 ) FINANCE AND OTHER INCOME   5,035   6,227     94   14,383   17,663       267   PROFIT BEFORE TAX 28,259 28,678 433 82,563 85,550 1,293 INCOME TAX EXPENSE   (6,228 ) (6,248 )   (94 ) (18,369 ) (18,679 )     (282 ) PROFIT FOR THE PERIOD   22,031   22,430     339   64,194   66,871       1,011     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 our customers organized by industry verticals as follows: Banking, Financial Services and Insurance (BFSI), Healthcare and Life Sciences (HLS), Retail, Consumer, Transport and Government (RCTG), Energy, Natural Resources and Utilities (ENU), Manufacturing (MFG), Global Media and Telecom (GMT). Starting with quarter ended September 30, 2014, it also includes Others which comprises dividend income and gains or losses (net) relating to strategic investments, which are presented within “Finance and other income” in the statement of Income. Key service offering 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 December 31, 2015 Three Months ended December 31, 2015 IT Services Revenue as per IFRS $ 1,838.3 IT Services Revenue as per IFRS $ 1,838.3 Effect of Foreign currency exchange movement $ 19.8     Effect of Foreign currency exchange movement $ 69.9   Non-GAAP Constant Currency IT Services Revenue based on exchange rates of previous quarter $ 1,858.1               Non-GAAP Constant Currency IT Services Revenue based on exchange rates of comparable quarter in the previous year   $ 1,908.2    

1. 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 December 31, 2015, for cable transfers in Indian rupees, as certified by the Federal Reserve Board of New York, which was US $1= Rs 66.19. However, the realized exchange rate in our IT Services business segment for the quarter ended December 31, 2015 was US$1= Rs 66.99
2. Refers to ‘Profit for the period attributable to equity holders of the company’
3. Refers to Segment Results

View source version on businesswire.com: http://www.businesswire.com/news/home/20160117005129/en/

WiproInvestor RelationsPavan N Rao, +91-80-4672 6143pavan.rao@wipro.comorAbhishek Kumar Jain, +1 978 826 4700abhishekkumar.jain@wipro.comorMedia & PressVipin Nair, +91-98450 14036vipin.nair1@wipro.com