Infosys performs below expectation, bottomline up 4.5%

Homegrown IT giant Infosys’ net profit has grown by 4.5% on quarter-on-quarter (Q-o-Q) basis, standing at Rs 3,436 crore for the quarter ended June 30, 2016, compared with Rs 3,030 crore in the corresponding quarter of last year.

The company had reported a net profit of Rs 3,597 crore for the quarter ended March 31, 2016.

The revenue of the company grew by 1.4% on Q-o-Q basis, to Rs 16,782 crore for the quarter ended June 2016, compared with Rs 14,354 crore. The revenues for the quarter preceding the June 30, 2016 quarter stood at Rs 16,550 crore.

However, the company reported a decline in the operating profit by 4.1%. Operating profit was Rs 4,047 crore for the quarter ended June 2016. For the quarter ended March 31, 2016, the figure stood at Rs 4,220 crore.

Gross profit dips
The gross profit of the company also declined by 3%, and stood at Rs 6,101 crore. This can be attributed to an increase of 4.1% in the cost of sales. The cost of sales in the quarter ended June 2016, for the company, stood at Rs 10,681 crore.

Liquid assets including cash and cash equivalents, and investments were Rs 33,212 crore as on June 30, 2016, compared with Rs 34,468 crore as on March 31, 2016, and Rs 30,235 crore as on June 30, 2015.

With regards to the guidance, revenues are expected to grow 10.5-12.0% (translates to 11.7-13.2% in INR terms based on March 31, 2016 rates, and 13.7-15.2% based on June 30, 2016 rates) in constant currency, as per the company.

“We had unanticipated headwinds in discretionary spending in consulting services and package implementations, as well as slower project ramp-ups in large deals that we had won in earlier quarters, resulting in a lower than expected growth in Q1,” Infosys CEO Vishal Sikka said.
DH News Service