WIPRO LIMITED 
By BANGALORE, India and EAST BRUNSWICK, N.J., April 17, 2014 /PRNewswire/ -- Wipro Limited (NYSE: WIT) today announced financial results under International Financial Reporting Standards (IFRS) for its fourth quarter and year ended March 31, 2014.
Highlights of the Results:
Results for the Quarter ended March 31, 2014:
-- Revenues from continuing operations were rupees 117.0 billion ($2.0
billion(1)), an increase of 22% YoY.
-- Net Income from continuing operations was rupees 22.3 billion ($371
million(1)), an increase of 41% YoY.
-- Non-GAAP Adjusted Net Income from continuing operations was rupees 22.3
billion ($371 million(1)), an increase of 42% YoY.
-- IT Services Revenue was $1,720.2 million, a sequential increase of 2.5%
and YoY increase of 8.5%.
-- IT Services(2) Revenues in Rupee terms was rupees 106.2 billion ($1.8
billion(1)), an increase of 24% YoY.
-- IT Services(2) Earnings Before Interest and Tax (EBIT) was rupees 26.1
billion ($434 million(1)), an increase of 51% YoY.
-- IT Services(2) Operating Margins was 24.5%, an expansion of 150 basis
points sequentially.
Results for the Year ended March 31, 2014:
-- Revenues from continuing operations were rupees 437.6 billion ($7.3
billion(1)), an increase of 16% YoY.
-- Net Income from continuing operations was rupees 78.0 billion ($1.3
billion(1)), an increase of 27% YoY.
-- Non-GAAP Adjusted Net Income from continuing operations was rupees 78.0
billion ($1.3 billion(1)), an increase of 28% YoY.
-- IT Services Revenue was $6,617.9 million, YoY increase of 6.4%.
-- IT Services(2) Revenues in Rupee terms was rupees 399.5 billion ($6.7
billion(1)), an increase of 18% YoY.
-- IT Services(2) Earnings Before Interest and Tax (EBIT) was rupees 90.3
billion ($1.5 billion(1)), an increase of 29% YoY.
-- IT Services(2) Operating Margins was 22.6% for the year an expansion of
195 basis points YoY.
-- Wipro declared a final dividend of rupees 5 ($0.08) per share /ADS,
taking the total dividend declared during the year to rupees 8 ($0.13)
per share/ADS.
(1) For the convenience of the reader, the amounts in Indian rupees in this release have been translated into United States dollars at the noon buying rate in New York City on March 31, 2014, for cable transfers in Indian rupees, as certified by the Federal Reserve Board of New York, which was US $1= rupees 60.00. However, the realized exchange rate in our IT Services business segment for the quarter ended March 31, 2014 was US$1= rupees 61.73
(2) For additional information on revenue and operating income by reportable segment on the new basis of segmentation, please see the financial statements
Performance for the quarter and year ended March 31, 2014
Azim Premji, Chairman of Wipro, commenting on the results said, "The steady improvement in global economy, coupled with the exciting pace of technological advancements, presents us with opportunities to create innovative solutions to help our customers differentiate, compete and succeed in their respective markets."
T K Kurien, Executive Director & Chief Executive Officer of Wipro, said, "Our focus on process simplification, automation and platform-based delivery continues to deliver results and we are seeing the benefits through improved productivity, reduced timelines in execution and greater business agility. It is also gratifying to see that this focus has enabled improved win ratios and has also enhanced customer satisfaction."
Suresh Senapaty, Executive Director & Chief Financial Officer of Wipro, said, "We continue to systematically work on improving our operational efficiencies resulting in expansion of full year IT Services operating margins by 195 basis points."
Outlook for the Quarter ending June 30, 2014
We expect Revenues from our IT Services business to be in the range of $ 1,715 million to $ 1,755 million*.
* Guidance is based on the following exchange rates: GBP/USD at 1.66, Euro/USD at 1.37, AUD/USD at 0.90, USD/INR at 61.62
IT Services
The IT Services segment had 146,053 employees as of March 31, 2014. We added 59 new customers for the quarter.
Wipro has won a five-year infrastructure managed services contract with a Fortune 500 global leader in specialty chemicals. This strategic engagement leverages Wipro's global network of data centers, delivery center footprint, automation capabilities and extensive experience in infrastructure and technology transformation. Wipro will incorporate ServiceNXT, its next-generation integrated managed services framework for this contract as well as leverage its strategic technology alliances in the industry.
Wipro has won a seven-year engagement with Xoserve, an organization which is an integral part of the restructured gas distribution market in Britain. The contract will involve replacement of Xoserve's two-decade old legacy platform with best-in-class enterprise applications and more contemporary technologies, which will enable Xoserve to better meet the expected demand growth generated by the roll-out of smart meters in the United Kingdom.
A large global bank has selected Wipro as a strategic partner to provide quality assurance and automation services. As part of this multi-year contract, services that are currently managed by multiple incumbent vendors will transition to Wipro. Wipro will also help establish a 'Target Operating Model' for software testing as well as provide functional and non-functional testing and automation services for the bank.
A leading apparel and footwear company has renewed its multi-year engagement with Wipro, for application support services in a managed services model. The services provided by Wipro will enhance the stability, resilience and reduce the total cost of ownership for the customer's organization-wide application landscape, which spans across several global brands and functions such as finance, supply chain, warehouse management and retail.
Wipro has won a deal from a multinational telecommunications company to manage IT and Network operations for their "Enterprise Business" in India. The scope of work includes design, build, feasibility, network operations and field support.
Wipro has won a large deal in the Basel II Risk & Compliance domain from a large state owned bank in India. The contract will provide Enterprise Risk Management for the Bank and its subsidiaries and will include the implementation of software, hardware, infrastructure management, and application sustenance.
Awards and accolades
Wipro was named 'Leader' in Worldwide Life Science Manufacturing and Supply Chain ITO by technology global research and advisory firm International Data Corporation (IDC) in its report IDC MarketScape: Worldwide Life Science Manufacturing and Supply Chain ITO 2013 Vendor Assessment, Doc #HI244265, November 2013. IDC evaluated leading Life Science Manufacturing and Supply Chain ITO Services providers across 24 criteria relating to current offering, strategy and market presence based on client inquiries, user needs assessments, and vendor and expert interviews.
IT Products
-- Our IT Products segment delivered Revenue of rupees 11.1 billion ($185
million(1)) for the quarter ended March 31, 2014, a YoY increase of 3%.
Revenue for the year end March 31, 2014 was rupees 38.8 billion ($646
million(1)), a decrease of 1% YoY.
-- Earnings Before Interest and Tax (EBIT) for the quarter ended March 31,
2014 was rupees 143 million ($2 million(1)), a decrease of 47% YoY. EBIT
for the year ended March 31, 2014 was rupees 310 million ($5
million(1)). a decrease of 69% YoY.The operating income of IT Products
segment for the year includes non-recurring expense of rupees 209
million ($3 million(1)) incurred due to cessation of manufacturing of
Wipro branded desktops, laptops and servers. Operating income of the IT
Products segment excluding the above non-recurring expense is rupees 519
million ($9 million(1)).
Please see the table on page 8 for a reconciliation between (i) IFRS Net Income and non-GAAP Adjusted Net Income (excluding the impact of stock-based compensation) and (ii) IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.
About Non-GAAP financial measures
This press release contains non-GAAP financial measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. Such non-GAAP financial measures are measures of our historical or future performance, financial position or cash flows that are adjusted to exclude or include amounts that are excluded or included, as the case may be, from the most directly comparable financial measure calculated and presented in accordance with IFRS.
The table on page 8 provides Adjusted Net Income for the period, which is a non-GAAP measure that excludes the impact of accelerated amortization in respect of stock options that vest in a graded manner, and IT Services Revenue on a constant currency basis, which is a non-GAAP measure that is calculated by translating IT Services Revenue from the current reporting period into U.S. dollars based on the currency conversion rate in effect for the prior reporting period. We consider a stock option award with a graded vesting schedule to be in substance a single award and not multiple stock option awards and accordingly believe the straight line amortization reflects the economic substance of the award. We refer to growth rates in constant currency so that business results may be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our business performance. We believe that the presentation of this Non-GAAP Adjusted Net Income, when shown in conjunction with the corresponding IFRS measure, provides useful information to investors and management regarding financial and business trends relating to its Net Income for the period.
These Non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, the most directly comparable financial measure calculated in accordance with IFRS, and may be different from non-GAAP measures used by other companies. In addition to these non-GAAP measures, the financial statements prepared in accordance with IFRS and the reconciliation of these non-GAAP financial measures with the most directly comparable IFRS financial measure should be carefully evaluated.
For internal budgeting process, our management also uses financial statements that exclude the impact of accelerated amortization relating to stock options that vest in a graded manner. Management of the Company also uses Non-GAAP Adjusted Net Income, in addition to the corresponding IFRS measure, in reviewing our financial results.
Results for the quarter and year ended March 31, 2014, computed under IFRS, along with individual business segment reports, are available in the Investors section of our website at www.wipro.com.
Quarterly Conference Call
We will hold a conference call today at 06:45 p.m. Indian Standard Time (09:15 a.m. US Eastern Time) to discuss our performance for the quarter. An audio recording of the management discussions and the question and answer session will be available online and will be accessible in the Investor Relations section of our website at www.wipro.com.
About Wipro Limited (NYSE: WIT)
Wipro provides comprehensive IT solutions and services, including systems integration, Information Systems outsourcing, IT enabled services, package implementation, software application development and maintenance, and research and development services to corporations globally. Wipro Limited is the first PCMM Level 5 and SEI CMM Level 5 certified IT Services Company globally.
For more information, please visit our websites at www.wipro.com.
Forward-looking and Cautionary Statements
The forward-looking statements contained herein represent Wipro's beliefs regarding future events, many of which are by their nature, inherently uncertain and outside Wipro's control. Such statements include, but are not limited to, statements regarding Wipro's growth prospects, its future financial operating results, and its plans, expectations and intentions. Wipro cautions readers that the forward-looking statements contained herein are subject to risks and uncertainties that could cause actual results to differ materially from the results anticipated by such statements. Such risks and uncertainties include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, revenue and profits, our ability to generate and manage growth, intense competition in IT services, our ability to maintain our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which we make strategic investments, withdrawal of fiscal governmental incentives, political instability, war, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property, and general economic conditions affecting our business and industry. Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission, including, but not limited to, Annual Reports on Form 20-F. These filings are available at www.sec.gov. We may, from time to time, make additional written and oral forward-looking statements, including statements contained in the company's filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.
(Tables to follow)
WIPRO LIMITED AND SUBSIDIARIES
AUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION
(Rupees in millions, except share and per share data, unless otherwise stated)
As of March 31, As of March 31,
--------------- ---------------
2013 2014 2014
---- ---- ----
ASSETS
------
Goodwill 54,756 63,422 1,057
Intangible assets 1,714 1,936 32
Property, plant and
equipment 50,525 51,449 857
Derivative assets 51 286 5
Available for sale
investments - 2,676 45
Non-current tax assets 10,308 10,192 170
Deferred tax assets 4,235 3,362 56
Other non-current assets 10,738 14,295 238
------ ------ ---
Total non-current assets 132,327 147,618 2,460
------- ------- -----
Inventories 3,263 2,293 38
Trade receivables 76,635 85,392 1,423
Other current assets 31,069 39,474 658
Unbilled revenues 31,988 39,334 656
Available for sale
investments 69,171 60,557 1,009
Current tax assets 7,408 9,774 163
Derivative assets 3,031 3,661 61
Cash and cash equivalents 84,838 114,201 1,903
------ ------- -----
Total current assets 307,403 354,686 5,911
------- ------- -----
TOTAL ASSETS 439,730 502,304 8,371
======= ======= =====
EQUITY
------
Share capital 4,926 4,932 82
Share premium 11,760 12,664 211
Retained earnings 259,178 314,952 5,249
Share based payment
reserve 1,316 1,021 17
Other components of equity 7,174 10,472 175
Shares held by controlled
trust (542) (542) (9)
---- ---- ---
Equity attributable to the
equity holders of the
company 283,812 343,499 5,725
Non-controlling Interest 1,171 1,387 23
----- ----- ---
Total equity 284,983 344,886 5,748
------- ------- -----
LIABILITIES
-----------
Long -term loans and
borrowings 854 10,909 182
Deferred tax liabilities 846 1,796 30
Derivative liabilities 118 629 10
Non-current tax liability 4,790 3,448 57
Other non-current
liabilities 3,390 4,174 70
Provisions 9 6 -
--- --- ---
Total non-current
liabilities 10,007 20,962 349
------ ------ ---
Loans and borrowings and
bank overdrafts 62,962 40,683 678
Trade payables and accrued
expenses 48,067 52,256 871
Unearned revenues 10,347 12,767 213
Current tax liabilities 10,226 12,482 208
Derivative liabilities 975 2,504 42
Other current liabilities 10,989 14,394 240
Provisions 1,174 1,370 23
----- ----- ---
Total current liabilities 144,740 136,456 2,274
------- ------- -----
TOTAL LIABILITIES 154,747 157,418 2,623
------- ------- -----
TOTAL EQUITY AND
LIABILITIES 439,730 502,304 8,371
======= ======= =====
WIPRO LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF INCOME
(`in millions, except share and per share data, unless otherwise stated)
Three months ended March 31, Year ended March 31,
2013 2014 2014 2013 2014 2014
---- ---- ---- ---- ---- ----
Convenience translation into US $ in Convenience translation into US $ in
millions (Unaudited) millions (Unaudited)
------------------------------------ ------------------------------------
Continuing Operations
Gross revenues 96,078 116,535 1,942 374,256 434,269 7,238
Cost of revenues (67,008) (77,700) (1,295) (260,665) (295,488) (4,925)
Gross profit 29,070 38,835 647 113,591 138,781 2,313
Selling and marketing expenses (6,183) (7,025) (117) (24,213) (29,248) (487)
General and administrative expenses (5,820) (6,510) (108) (22,032) (23,538) (392)
Foreign exchange gains/(losses), net 62 510 8 2,626 3,359 56
Results from operating activities 17,129 25,810 430 69,972 89,354 1,490
Finance expenses (395) (842) (14) (2,693) (2,891) (48)
Finance and other income 3,077 3,959 66 11,317 14,542 242
Profit before tax 19,811 28,927 482 78,596 101,005 1,684
Income tax expense (3,973) (6,536) (109) (16,912) (22,600) (377)
Profit for the period from continuing operation 15,838 22,391 373 61,684 78,405 1,307
------ ------ --- ------ ------ -----
Discontinued operation
Profit after tax for the period from discontinued operation 1,535 - - 5,012 - -
Profit for the period 17,373 22,391 373 66,696 78,405 1,307
====== ====== === ====== ====== =====
Attributable to:
Equity holders of the company 17,287 22,265 371 66,359 77,967 1,300
Non-controlling interest 86 126 2 337 438 7
Profit for the period 17,373 22,391 373 66,696 78,405 1,307
====== ====== === ====== ====== =====
Profit from continuing operations attributable to:
Equity holders of the company 15,756 22,265 371 61,362 77,967 1,300
Non-controlling interest 82 126 2 322 438 7
15,838 22,391 373 61,684 78,405 1,307
====== ====== === ====== ====== =====
Earnings per equity share:
Attributable to equity share holders of the company
Basic 7.04 9.07 0.15 27.05 31.76 0.53
Diluted 7.02 9.04 0.15 26.98 31.66 0.53
From continuing operations
Basic 6.42 9.07 0.15 25.01 31.76 0.53
Diluted 6.40 9.04 0.15 24.95 31.66 0.53
Weighted average number of equity shares used in computing earnings
per equity share
Basic 2,455,037,295 2,455,543,231 2,455,543,231 2,453,218,759 2,454,745,434 2,454,745,434
Diluted 2,460,940,973 2,462,876,367 2,462,876,367 2,459,184,321 2,462,626,739 2,462,626,739
Additional Information
Segment Revenue
IT Services 85,538 106,193 1,770 338,431 399,509 6,658
IT Products 10,746 11,090 185 39,238 38,785 646
IT Services & Products 96,284 117,283 1,955 377,669 438,294 7,305
Consumer Care and Lighting (Discontinued operation) 10,440 - - 40,594 - -
Others (Discontinued operation) 3,393 - - 14,785 - -
Others 147 (238) (4) 560 (666) (11)
Total 110,264 117,045 1,951 433,608 437,628 7,294
Operating Income
IT Services 17,268 26,054 434 69,933 90,333 1,506
IT Products 268 143 2 990 310 5
IT Services & Products 17,536 26,197 436 70,923 90,643 1,511
Consumer Care and Lighting (Discontinued operation) 1,337 - - 5,012 - -
Others (Discontinued operation) (23) - - 290 - -
Others (473) (387) (6) (1,079) (1,289) (21)
Total 18,376 25,810 430 75,146 89,354 1,490
Reconciliation of adjusted Non-GAAP profit to profit as per IFRS
Profit for the period attributable to Equity holders of the Company
(Continuing operations) 15,756 22,265 371 61,362 77,967 1,300
Adjustments :
Accelerated amortization of stock options that vest in a graded
manner (68) 1 - (308) (3) (0)
Non-GAAP adjusted profit (Continuing operations) 15,687 22,266 371 61,054 77,963 1,300
====== ====== === ====== ====== =====
Profit for the period attributable to Equity holders of the Company
(Discontinued operations) 1,531 - - 4,997 (0) (0)
Adjustments :
Accelerated amortization of stock options that vest in a graded
manner (1) - - (12) - -
Non-GAAP adjusted profit (Discontinued operations) 1,530 - - 4,984 (0) (0)
===== === === ===== === ===
Reconciliation of Non-GAAP Constant Currency IT Services Revenue to IT Services Revenue as per IFRS ($MN)
IT Services Revenue as per IFRS 1,720.2
Effect of Foreign currency exchange movement 2.8
Non-GAAP Constant Currency IT Services Revenue based on previous
quarter exchange rates 1,717.4
IT Services Revenue as per IFRS 1,720.2
Effect of Foreign currency exchange movement 11.8
Non-GAAP Constant Currency IT Services Revenue based on previous
year exchange rates 1,732.0
Segment Revenue and Operating Income as per new basis of segmentation
SEGMENT Three months ended March 31, 2014 Year ended March 31, 2014
------- --------------------------------- -------------------------
Revenue Operating Income Revenue Operating Income
------- ---------------- ------- ----------------
BFSI 28,468 7,005 106,035 24,153
HLS 11,275 2,482 41,130 7,637
RCTG 15,412 4,048 58,893 13,012
ENU 17,173 4,887 63,923 17,418
MFG 19,095 4,909 74,423 17,348
GMT 14,770 3,332 55,105 11,569
UNALLOCATED - (609) - (804)
--- ---- --- ----
TOTAL IT SERVICES 106,193 26,054 399,509 90,333
IT PRODUCTS 11,090 143 38,785 310
RECONCILING ITEM (238) (387) (666) (1,289)
---- ---- ---- ------
ENTITY TOTAL 117,045 25,810 437,628 89,354
SOURCE Wipro Limited
