Infosys revenue up 5.5% in Q4, net profit remains flat

To hire 30,000 this year

The company registered revenue of Rs 5,944 crore for the fourth quarter ending 31 March 2010 compared to Rs 5,741 crore in the same quarter last financial, registering a growth of 5.5 per cent year-on-year (YoY) as per the International Financial Reporting Standards (IFRS). The net profit for the reporting quarter stood at Rs 1,600 crore recording a marginal YoY growth of 0.9 per cent. The company board of directors also announced a final dividend of Rs 15 per share for the fiscal 2010.

Announcing the quarterly results, Infosys CEO & Managing Director S Gopalakrishnan said “We have been able to take advantage of opportunities in the market and grow faster due to our investments in capacity and capability.” Though the economic environment continues to be challenging, business are investing in growth and we see a huge market in the US and European continent, he added.

Infosys also said at the end of March 31, 2010, its cash and cash equivalents, including investments in ‘available for sale’ financial assets and certificates of deposits was Rs 15,857 crore compared to Rs 10,993 crore as on March 31, 2009. Responding to queries about financial performance Infosys Chief Financial Officer V Balakrishnan said “the currency volatility continues to be a concern for the industry. We, however, have an active hedging programme to minimise its impact on our margins.”

Hiring to continue

Infosys and its subsidaries added 47 new clients during the quarter ended on March 31. According to the firm, the revenue from North America contributed 66.1 per cent to the total revenue while Europe and India contributed 22.5 per cent and 1.4 respectively. Infy also said insurance, banking and financial, manufacturing and retail were the main revenue generating businesses during the quarter.

  “We continue to increase our relevance to our clients through thought leadership and investment R&D, especially in areas such as digital consumers, building smarter organisation and sustainability,” said Infosys Chief Operating Officer Shibulal. Infy also said it hired 9,313 employees in the fourth quarter while the net addition after attrition was 3,914, taking the total employee strength to 1,13,796 as on March 31, 2010.
According to Infosys Board Member & Head — HRD and Education & Research, T V Mohandas Pai, “We undertook world’s largest career architecture transformation. We are planning to hire 30,000 employees for the fiscal 2011, out of which 19,000 will be from campuses and others will be through lateral hiring.”

The company which was facing troubles from its employees on the new HR initiative also announced a huge salary hike ranging from 13-17 per cent across the board in India and 2-3 per cent outside the country.

Future Outlook

Going forward Infosys projected average revenue guidance (under IFRS) in the range of Rs 5,919 crore and Rs 5,963 for the Q1 of FY 2010-11 which will be yoy growth of 8.2 per cent to 9 per cent. While the income for the fiscal year ending March 31, 2011 is expected to be in the range of Rs 24, 796 crore and Rs 25, 239 crore which will be an yoy growth of 9 per cent to 11 per cent, from the current Rs 22,742 crore. Shares of Infy which was volatile in the morning surged 3.69 per cent at the end of trading in BSE.