Infosys reports 37.6% rise in net profit in October-December 2017 quarter

Andrew Cummings
January 12, 2018

Infosys total employees stood at 2,01,691 as on December 2017, higher from 1,98,440 employees as on September 2017 and 1,99,763 employees in December 2016.

He said that building on strategy initiated by Infosys Chairman Nandan Nilekani, the company is conducting a review structured around four dimensions, namely, new market opportunities, client relationships, people, and service offering portfolio.

Infosys reported a quarter that was largely in line with expectations and said it retains its full-year revenue growth guidance at 5.5-6.5%, excluding the impact of currency movements.

Analysts at HDFC Securities projected profits of Rs 5,182 crore, including the tax reversal, which implies they expected Infosys to report profit growth of 1 percent, excluding the tax reversal component. Sikka quit in August after three years at the helm of Infosys, a stint marked by a feud between some founders of the company, led by N.R. Narayana Murthy, and the previous board.

Chief Executive Salil Parekh, who joined the company in January, said he planned to engage with clients, employees, partners, senior executives and the company's board over the next three months to build a "comprehensive view". The earnings per share of the company grew by 39%, and stood at Rs 22.55, as against Rs 16.22 in the corresponding quarter last fiscal. ".Our Q3 performance is strong. Beyond that, any other interaction will be a social interaction", said Parekh. There are exciting opportunities in IT services market. The same was reiterated by Infosys COO UB Pravin Rao while addressing a press conference post the release of the company's third quarter results.

"In accordance with the APA, the company expects to reverse tax provisions of approximately $225 million made in previous periods which are no longer required (both under International Financial Reporting Standards and Indian Accounting Standards)", it added.

Parekh said, "We are progressing towards stability and are well positioned to serve our clients in the new areas of demand".

M.D. Ranganath, CFO said operating margins were stable due to broad-based improvement in operational efficiency parameters.

Earlier this week, Infosys had signed an Advance Pricing Agreement (APA) with the U.S. revenue department, which will result in reversal of tax provisions of about $225 million. "Our investments in employees continues to deliver results as reflected in lower attrition".

It came a day after TCS reported an nearly four percent decline in earnings due to falling demand for its banking and financial services.

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