Infy Q4 net profit up 13.6%; revenue 22% year-on-year

 India’s second largest Information Technology (IT) company — Infosys Technologies Ltd, on Friday, announced that for quarter-ended March 2011 (Q4), its net profit at Rs 1,818 crore was 13.6 per cent higher than Rs 1,600 crore the same quarter last year. However, the actual growth in net profit was 17 per cent after discounting for Rs 48 crore earned from sale of OnMobile Systems Inc in Q4 last year.

Infy’s Q4 revenue at Rs 7,250 crore saw a 22 per cent jump over Rs 5,944 crore in Q4 previous year. In dollar terms the company’s revenue and profits in Q4 grew 24 per cent and 15 per cent, year-on-year. However, on a sequential basis the company’s net profit was up by just 2.1 per cent which led to the bellwether’s stocks sliding by 9.59 per cent to close the day at 2,988.80.

Since March 31 was also the end of financial year 2010-11, Infosys announced that in last financial year its total revenue at Rs 27,501 crore ($6.04 billion) was 21 per cent higher than 2009-10 and its net profit at Rs 6,823 crore ($1.50 billion) was 9.7 per cent higher. Infosys management pointed out that the annual revenue growth of the company was slightly better than what it projected in the beginning of the last financial year.

Infosys Chief Financial Officer V Balakrishnan said: “During the year the rupee appreciated 5 per cent resulting in a $7million hit on our bottom line. Our Q4 profits would have been down by 200 basis points but for the effective management of the foreign exchange earnings through adequate risk cover.” A 58 per cent jump in income tax to Rs 2,490 crore in 2010-11, denoting 27 per cent effective tax rate, was the other reason for a not-so-impressive growth in post-tax profit, Balakrishnan said. During the year Infosys announced total dividend of Rs 60 on each share of Rs 5. “We have created a structure with strong customer driven vertical focus and have enhanced our investment to take advantage of the opportunities we see in the market,” said CEO & Managing Director S Gopalakrishnan. “We continue to be a partner of choice for our clients and 98 per cent of our revenue comes repeat business.” Company also did well in client mining as top ten clients accounted for 26 per cent of the revenue. Infy added 34 new clients during the year and, implying better operational efficiencies, its overall employee utilisation rate (excluding trainees) went up to 79 per cent against 74 per cent in the previous year.  

At the end of 2010-11 Infosys had 1.31 lakh employees. During the year the company hired 43,120 people and lost 26,096 resulting in net addition of 8,946. In the current financial the company plans to hire 45,000 people, of which 26,000 will be freshers from campuses, HR Head T V Mohandas Pai said.

Infy also announced that its Board of Directors will meet on April 30, 2011 to select a successor for Narayana Murthy, present Chairman and Chief Mentor. It also said former Microsoft Chairman Ravi Venkatesan has been appointed Additional Director of the company. Infosys also announced that K Dinesh, co-founder of the company and HR Head Mohandas Pai will resign from the board and quit the company with effect from June 11, 2011. Ravi Venkatesan was Chairman of Microsoft India; under his leadership from 2004-2011, India became Microsoft’s second largest and one of its fastest growing geographies.