Wednesday, 23 May, 2018

Infosys profit beats expectations on tax benefits

Infosys CEO Salil Parekh is conducting a review structured around four dimensions namely new market opportunities client relationships people and service offering portfolio Infosys profit beats expectations on tax benefits
Nellie Chapman | 12 January, 2018, 15:49

IT major Infosys is scheduled to announce Q3 December 2017 results today, 12 January 2018.

According to a BSE filing, revenues of the Bengaluru-based firm grew 3 per cent to Rs 17,794 crore in the quarter under review as against Rs 17,273 crore in the December 2016 quarter. Infosys is expected to maintain its FY18 revenue guidance at 5.5-6.5 per cent in constant currency. Including the tax reversal, HDFC Securities expects Infosys to report a net profit of Rs 5,182 crore.

The profit rise was due to the conclusion of the Advance Pricing Agreement, which had a positive impact on consolidated basic earnings per share in the quarter by about 6.29 rupees. His predecessor Vishal Sikka quit late past year after a long-drawn public fued with Infosys' founders. The founders had alleged corporate governance lapses and questioned the Dollars 200 million Panaya acquisition under previous management and also flagged the high severance pay to former employees. ".Our Q3 performance is strong".

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

Under the International Financial Reporting Standard (IFRS), or in dollar terms, net income shot up 45 per cent annually to $796 million in Q3 from $547 million in the like period year ago and 37.6 sequentially from Rs 578 crore a quarter ago.

However, Infosys' Chief Operating Officer U.B. Pravin Rao said increased adoption of digital solutions and new services has helped stabilize its price realization that has been under pressure for almost two years. Its total headcount stood at 2.01 lakh at the end of December quarter.

On the management changes, the company said that Rajesh K Murthy, President, has resigned citing personal reasons and his resignation will be effective January 31, it added.

Commenting on the Q3 earnings, Salil Parekh, CEO and MD of Infosys, said: "It is a privilege for me to be appointed as the CEO & MD of Infosys, helping our clients navigate the digital future and employees build new skills and capabilities".

"While clients are facing digital disruption, we see an opportunity rising for us". He also faces several immediate challenges, including customer outreach, working relationship with founders and employees, and restore stakeholders trust.