Gross Revenues grew 10% YoY
IT Services Segment Revenue in US Dollar
terms grew by 7.2% YoY in constant currency
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today
announced financial results under International Financial Reporting
Standards (IFRS) for its second quarter ended September 30,
2016.
Highlights of the
Results
- Gross Revenues were Rs 137.7 billion
($2.1 billion1), an increase of 10% YoY.
- Net Income2 was Rs 20.7 billion ($312
million1), a decline of 8% YoY.
- Non-GAAP constant currency IT Services
Segment Revenue in dollar terms grew 0.9% sequentially and grew
7.2% YoY.
- IT Services Segment Revenue was
$1,916.3 million, a sequential decrease of 0.8% and YoY increase of
4.6%.
- IT Services Segment Revenue in Rupee
terms was Rs 131.4 billion ($2.0 billion1), an increase of 9%
YoY.
- IT Services Segment Profits3 was Rs
23.4 billion ($352 million1), a decrease of 5% YoY.
- IT Services Margins4 was 17.8% for the
quarter, as compared to 17.8% for the quarter ended June 30,
2016.
Performance for the quarter ended
September 30, 2016
“We delivered Revenues in constant currency at the top end of
our guidance range,” said Abidali Z. Neemuchwala, Chief
Executive Officer and Member of the Board. “I am very excited
about Wipro’s acquisition of Appirio, a leader in cloud
applications especially across Salesforce and Workday
implementation services. This acquisition will establish Wipro’s
dominance in cloud application services and further strengthen
Wipro’s brand as a Digital Partner of choice.”
“We maintained margins in Q2 despite the impact of salary
increase for an incremental two months due to strong operational
improvements in automation-led productivity, offshoring and
utilization,” said Jatin Dalal, Chief Financial Officer. “As
we look forward, the demand environment is mixed in a seasonally
weak quarter affected by furloughs and lower number of working
days.”
Outlook for the Quarter ending December
31, 2016
We expect Revenues from our IT Services business to be in the
range of $ 1,916 million to $ 1,955 million*.
* Guidance is based on the following exchange rates: GBP/USD at
1.26, Euro/USD at 1.11, AUD/USD at 0.76, USD/INR at 67.01 and
USD/CAD at 1.31.
IT Services
The IT Services segment had a headcount of 174,238 as of
September 30, 2016.
Wipro has won a multi-year network management product sustenance
deal from a Tier-1 network equipment provider. The company has been
working with the client to optimize the total cost of ownership,
and this end-to-end ownership engagement further strengthens
Wipro’s relationship with the customer.
A global consumer electronics and technology major headquartered
in Europe has awarded an IT application managed services deal to
Wipro. As part of the project, Wipro will consolidate and optimize
the client’s IT application managed services through
hyper-automation using the Wipro HOLMES Artificial Intelligence
Platform™. The engagement will further strengthen Wipro’s existing
relationship with the customer.
Wipro has been awarded a three-year IT infrastructure services
contract by a prominent Australian oil and gas company with a
global presence. The client has chosen Wipro as their strategic
partner due to its proven capabilities in the infrastructure
services space and expertise in automation. Wipro will also be a
partner for the digital transformation of the client’s upstream
operations.
Wipro has won a multi-year managed services engagement with a
large Australian utilities business. The scope of the contract
includes Applications, Networks, End User Computing, Service Desk
and Data Centre Services. This engagement will see Wipro helping
the customer transition to a more scalable and sustainable cost
based model, which improves services and functional capabilities
through digital initiatives.
Wipro has won a multi-year managed services engagement with a
top U.S. Department Store Retailer to transform their Quality
Centre of Excellence. This deal will enable the client to realize
significant savings and achieve quicker ‘Go to Market’ through
transformation initiatives involving quality engineering and Wipro
IP-enabled cognitive automation and robots.
Wipro has won a multi-year engagement with The Highland Council,
UK to transform their core IT infrastructure and provide tablet
devices to school children. This program will empower the Council
to provide robust IT services and transform education in schools in
the region.
Digital highlights
“Service providers in the digital transformation space need to
develop a comprehensive set of capabilities to meet the new client
demand effectively. In this context, through strategic acquisitions
including Designit, investments in Wipro Digital and studios in key
client hubs, and a strong partner ecosystem, Wipro has developed
unique competencies that integrate technology and domain to
establish industry leading digital delivery capabilities,” said
Peter Bendor-Samuel, CEO, Everest Group.
Wipro will enable a global contract manufacturing company in its
journey of implementing the “SmartFactory” model through advanced
automation, machine learning, IoT and data analytics.
A leading provider for electricity distribution, automation and
energy management has engaged Wipro to help them develop new
business models through the intelligent application of their
software and entitlement management systems.
Wipro will enable a biopharmaceutical company transform the
online digital experience for its customers. Leveraging expertise
from its Digital, Designit, Digital Engineering and Connected
Enterprise Services teams, Wipro will deliver a consistent and
relevant experience across multiple websites for the company’s
customers.
A leader in the DIY (Do It Yourself) home space has chosen Wipro
and Designit as its partners to help the company define the vision,
a new value proposition, product road-map and design products for
its Connected Home segment.
Designit was asked by one of the world’s leading ICT solution
providers to define and design the next innovative application for
smart watches. The goal is to assist with developing realizable
next-generation functionalities for the product line management at
the client’s headquarters in Asia. The client seeks an innovative
state-of-the-art customization of Android Wear in regards to
application interfaces and the necessary programming.
Wipro has secured a Data Discovery Platform win at a western
Australian state government-owned corporation. This program will
help the organization understand where their predictive asset
maintenance capabilities currently lie, and provide a roadmap to
develop their analytics capabilities. Wipro’s Data Discovery
Platform will use the best of breed open source technologies and
leverage cognitive capabilities from Wipro HOLMES Artificial
Intelligence Platform™ to bring to life the hidden insights in
large and diverse data sets.
We have had more than 10 cloud application wins this quarter and
a few of the notable ones are as follows:
- Wipro was selected to implement a cloud
based Procure-to-Pay solution for a global leader in branded
lifestyle apparel, footwear and accessories.
- An American Chemicals Conglomerate
selected Wipro to define their CRM modernization roadmap using a
leading cloud CRM platform.
- A global marketing services firm has
chosen Wipro to manage and execute the campaigns of their customers
using leading marketing cloud platforms.
Delivery Excellence
“We wanted a partner who can think global and act local. Wipro
has displayed a deep understanding of our business priorities,
organization culture and the ability to challenge and innovate the
way of executing the business. Wipro is our trusted partner in this
journey and our journey will continue with Wipro in the future as
well,” said Serhan Ozhan, CIO, CLK Enerji.
“It is key for us in IT to provide consistent and reliable
services and we look to Wipro to help us do that. They bring best
in class practices to IT that we think we’ll be able to leverage
over the coming years. Our experience in dealing with Wipro is that
they have always been responsive. We trust them as a partner. They
are honest and a very high integrity company,” said Christopher
Krebs, Senior Vice President & CIO, Fruit of the Loom.
Wipro deployed an integrated retail solution across 550 stores
for a global retail major enabling central visibility of inventory,
price differentials, cash and sales forecast. The retail solution
led to the decommissioning of 10 legacy applications and helped
reduce stock outage situations by almost 90%, resulting in an
increased in-store customer satisfaction.
Awards and accolades
Gartner has identified Wipro Digital as a Representative
Provider of all five services - Business Model Innovation,
Cybersecurity and Digital Trust, Internet of Things,
Industry-Specific Disruptive Technologies and Organizational
Culture and Change Management in its Market Guide for Digital
Business Consulting Services.*
Wipro has been included in the Dow Jones Sustainability Index
(DJSI) – World and Emerging Markets for the seventh time in
succession.
Wipro has been cited as a "Leader" by technology global research
and advisory firm Forrester Research Inc. in its report, "The
Forrester WaveTM: Services Providers for Next-Generation Oracle
Application Projects, Q3 2016.
Wipro won the Teradata Epic Award for ICP Collaborative Revenue
category at Teradata Partners Conference & Expo 2016. The
Collaborative Revenue award recognizes the Integration and
Consulting Partners (ICP) who worked with Teradata to influence the
largest year-over-year order revenue growth for Teradata technology
and services.
Wipro has been named as a "Leader" in the report “IDC
MarketScape: Worldwide Oracle Implementation Services 2016 Vendor
Assessment”.
Wipro has been featured in the “Winner’s Circle” by HfS Research
in its 2016 blueprint report on Mortgage As-a-Service. HfS said
Wipro has one of the most progressive strategies for moving toward
Mortgage As-a-Service and is expanding market lead and vision by
integrating and building on valuable mortgage industry assets.
Wipro is rated as a “Leader" in the Everest Group PEAK Matrix
reports for Capital Markets BPO, Application Outsourcing and FAO
Service providers in 2016.
Wipro has been positioned in the "Winner's Circle" by HfS
Research in its 2016 blueprint report on Energy Operations. HfS
said Wipro is enabling new business models across the value chain
with strong capabilities in Digital, automation and domain
expertise.
*Gartner does not endorse any vendor, product or service
depicted in its research publications, and does not advise
technology users to select only those vendors with the highest
ratings or other designation. Gartner research publications consist
of the opinions of Gartner’s research organization and should not
be construed as statements of fact. Gartner disclaims all
warranties, expressed or implied, with respect to this research,
including any warranties of merchantability or fitness for a
particular purpose.
IT Products
- Revenue for the quarter ended September
30, 2016 was Rs 7.7 billion ($115 million1).
Please refer to the table 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 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 September 30, 2016, 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/wipro161021.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.
About Wipro Limited
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) is a leading
information technology, consulting and business process services
company that delivers solutions to enable its clients 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 170,000,
serving clients across 6 continents. For more information, please
visit www.wipro.com.
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, 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 September 30, 2016 2016 2016
Convenience translation
into US dollar in millions (unaudited) - Refer
footnote 1
ASSETS
Goodwill 101,991 101,864 1,530 Intangible assets 15,841 14,479 217
Property, plant and equipment 64,952 69,103 1,038 Derivative assets
260 100 2 Investments 4,907 5,092 76 Non-current tax assets 11,751
11,938 179 Deferred tax assets 4,286 3,530 53 Other non-current
assets 15,828 16,773 252
Total non-current assets 219,816
222,879 3,347 Inventories 5,390 5,215 78 Trade receivables
100,976 101,170 1,520 Other current assets 32,894 32,245 484
Unbilled revenues 48,273 48,691 731 Investments 204,244 258,499
3,883 Current tax assets 7,812 8,131 122 Derivative assets 5,549
6,746 101 Cash and cash equivalents 99,049 55,167 829
Total
current assets 504,187 515,864 7,748
TOTAL ASSETS
724,003 738,743 11,095
EQUITY
Share capital 4,941 4,861 73 Share premium 14,642 427 6 Retained
earnings 425,106 452,925 6,803 Share based payment reserve 2,229
2,761 41 Other components of equity 18,242 22,353 335 Equity
attributable to the equity holders of the Company 465,160 483,327
7,258 Non-controlling interest 2,224 2,363 35
Total equity
467,384 485,690 7,293
LIABILITIES
Long - term loans and borrowings 17,361 18,004 270 Deferred tax
liabilities 5,108 4,436 67 Derivative liabilities 119 26 -
Non-current tax liabilities 8,231 7,795 117 Other non-current
liabilities 7,225 7,269 109 Provisions 14 14 -
Total non-current
liabilities 38,058 37,544 563 Loans, borrowings and bank
overdrafts 107,860 106,600 1,601 Trade payables and accrued
expenses 68,187 68,487 1,031 Unearned revenues 18,076 15,053 226
Current tax liabilities 7,015 8,810 132 Derivative liabilities
2,340 2,553 38 Other current liabilities 13,821 12,820 193
Provisions 1,262 1,186 18
Total current liabilities 218,561
215,509 3,239
TOTAL LIABILITIES 256,619 253,053 3,802
TOTAL EQUITY AND LIABILITIES 724,003 738,743
11,095
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 September 30, Six
Months ended September 30, 2015 2016 2016
2015 2016 2016
Conveniencetranslation
into US dollar in millions(unaudited) Refer
footnote 1
Conveniencetranslation
into US dollar in millions(unaudited) Refer
footnote 1
Gross revenues 125,135 137,657 2,068 247,511 273,649 4,111 Cost of
revenues (85,824 ) (97,808 ) (1,469 ) (170,611 ) (194,197 ) (2,917
)
Gross profit 39,311 39,849 599
76,900 79,452 1,194 Selling and
marketing expenses (8,708 ) (9,614 ) (144 ) (16,752 ) (19,755 )
(297 ) General and administrative expenses (6,887 ) (8,545 ) (128 )
(13,780 ) (16,144 ) (242 ) Foreign exchange gains/(losses), net 533
1,281 19 1,863 2,265 34
Results from operating
activities 24,249 22,971 346 48,231
45,818 689 Finance expenses (1,589 ) (1,428 )
(21 ) (2,875 ) (2,764 ) (42 ) Finance and other income 6,318 5,105
77 11,653 10,305 155
Profit before tax 28,978
26,648 402 57,009 53,359 802
Income tax expense (6,515 ) (5,909 ) (89 ) (12,473 )
(12,031 ) (181 )
Profit for the period
22,463 20,739 313
44,536 41,328 621
Attributable to: Equity holders of the company 22,409 20,672
312 44,326 41,190 619 Non-controlling interest 54 67
1 210 138 2
Profit for the period 22,463 20,739
313 44,536 41,328 621
Earnings per equity share:
Attributable to equity share holders of
the company
Basic 9.12 8.54 0.13 18.05 16.89 0.25 Diluted 9.10 8.52 0.13 18.01
16.84 0.25
Weighted average number of equity shares
used in computing earnings per equity share
Basic 2,456,285,585 2,420,621,137 2,420,621,137 2,456,223,408
2,439,012,817 2,439,012,817 Diluted 2,461,507,934 2,426,812,644
2,426,812,644 2,460,985,436 2,445,466,651 2,445,466,651
Additional Information Segment Revenue IT Services
Business Units BFSI 32,252 33,583 503 63,273 67,213 1,011 HLS
13,746 20,883 314 26,734 40,814 613 CBU 19,510 20,708 311 38,210
41,433 622 ENU 17,664 16,881 254 35,240 34,237 514 MNT 28,146
29,463 443 55,109 59,001 886 COMM 9,110 9,848
148 17,635 19,760 297
IT SERVICES TOTAL 120,428 131,366 1,973 236,201 262,458
3,943 IT PRODUCTS 5,442 7,666 115 13,616 13,596 204 RECONCILING
ITEMS (202 ) (94 ) (1 ) (443 ) (140 ) (2 )
TOTAL 125,668 138,938 2,087
249,374 275,914 4,145
Segment
Result IT Services Business Units BFSI 6,882 6,379 96
13,829 13,373 201 HLS 3,023 3,234 49 5,777 6,090 91 CBU 3,238 3,584
54 6,320 7,359 111 ENU 3,272 3,443 52 6,859 6,468 97 MNT 6,370
6,175 93 12,203 12,129 182 COMM 1,554 1,594 24 2,801 3,096 47
OTHERS - - - - UNALLOCATED 277 (1,037 ) (16 )
808 (1,874 ) (28 )
TOTAL IT SERVICES 24,616
23,372 352 48,597 46,641 701 IT PRODUCTS (244 ) (298 ) (4 ) (141 )
(666 ) (10 ) RECONCILING ITEMS (123 ) (103 ) (2 )
(225 )
(157
) (2 ) TOTAL 24,249 22,971 346
48,231 45,818 689 FINANCE
EXPENSE (1,589 ) (1,428 ) (21 ) (2,875 ) (2,764 ) (42 ) FINANCE AND
OTHER INCOME 6,318 5,105 77
11,653 10,305 155 PROFIT BEFORE TAX
28,978 26,648 402 57,009 53,359 802 INCOME TAX EXPENSE
(6,515 ) (5,909 ) (89 ) (12,473 ) (12,031 ) (181 )
PROFIT FOR THE PERIOD 22,463
20,739 313
44,536
41,328 621 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. Effective April 1, 2016, we realigned our industry
verticals. The Communication Service Provider business unit was
regrouped from the former GMT industry vertical into a new industry
vertical named “Communications”. The Media business unit from the
former GMT industry vertical has been realigned with the former
RCTG industry vertical which has been renamed as “Consumer Business
Unit” industry vertical. Further, the Network Equipment Provider
business unit of the former GMT industry vertical has been
realigned with the Manufacturing industry vertical to form the
“Manufacturing and Technology” industry vertical. The revised
industry verticals are as follows: Finance Solutions (BFSI),
Healthcare, Lifesciences & Services (HLS), Consumer (CBU),
Energy, Natural Resources & Utilities (ENU), Manufacturing
& Technology (MNT), Communications (COMM). IT Services segment
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 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 September 30,
2016 Three Months ended September 30, 2016 IT Services
Revenue as per IFRS $ 1,916.3 IT Services Revenue as per IFRS $
1,916.3 Effect of Foreign currency exchange movement $ 32.3
Effect of Foreign currency exchange movement $ 47.2 Non-GAAP
Constant Currency IT Services Revenue based on previous quarter
exchange rates $ 1,948.6 Non-GAAP Constant Currency IT Services
Revenue based on previous year exchange rates $ 1,963.5
- 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
September 30, 2016, for cable transfers in Indian rupees, as
certified by the Federal Reserve Board of New York, which was US
$1= Rs 66.58. However, the realized exchange rate in our IT
Services business segment for the quarter ended September 30, 2016
was US$1= Rs 68.55
- Net Income refers to ‘Profit for the
period attributable to equity holders of the Company’
- Segment Profit refers to segment
results. Effective April 1, 2016, the segment results is measured
after including the amortization charge for acquired intangibles to
the respective segments. Such costs were classified under
reconciling items until the fiscal year ended March 31, 2016.
Comparative information has been restated to give effect to the
same.
- Margins have been computed based on the
change as listed in footnote 3. above
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161021005601/en/
Wipro LimitedContact for Investor RelationsPavan N
RaoPhone: +91-80-4672 6143pavan.rao@wipro.comorAbhishek Kumar
JainPhone: +1 978 826 4700abhishekkumar.jain@wipro.comorContact
for Media & PressVipin NairPhone: +91-80-3991
6450vipin.nair1@wipro.com
Wipro (NYSE:WIT)
Historical Stock Chart
From Mar 2024 to Apr 2024
Wipro (NYSE:WIT)
Historical Stock Chart
From Apr 2023 to Apr 2024