WIPRO LIMITED 
By FOR IMMEDIATE RELEASE
Results for the quarter and year ended March 31, 2014 under IFRS
Net Income Grew 41% YoY in the quarter IT Services Operating Margin Expanded by 150 basis points sequentially IT Services Revenues Grew 24% YoY in the quarter; IT Services EBIT Grew 51% YoY in the quarter Bangalore, India and East Brunswick, New Jersey, USA - April 17, 2014 -- 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 `117.0 billion ($2.0 billion1), an increase of 22% YoY.
Net Income from continuing operations was `22.3 billion ($371 million1), an increase of 41% YoY.
Non-GAAP Adjusted Net Income from continuing operations was `22.3 billion ($371 million1), 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 Services2 Revenues in Rupee terms was `106.2 billion ($1.8 billion1), an increase of 24% YoY.
IT Services2 Earnings Before Interest and Tax (EBIT) was `26.1 billion ($434 million1), an increase of
51% YoY.
IT Services2 Operating Margins was 24.5%, an expansion of 150 basis points sequentially.
Revenues from continuing operations were `437.6 billion ($7.3 billion1), an increase of 16% YoY.
Net Income from continuing operations was `78.0 billion ($1.3 billion1), an increase of 27% YoY.
Non-GAAP Adjusted Net Income from continuing operations was `78.0 billion ($1.3 billion1), an increase of 28% YoY.
IT Services Revenue was $6,617.9 million, YoY increase of 6.4%.
IT Services2 Revenues in Rupee terms was `399.5 billion ($6.7 billion1), an increase of 18% YoY.
IT Services2 Earnings Before Interest and Tax (EBIT) was `90.3 billion ($1.5 billion1), an increase of
29% YoY.
IT Services2 Operating Margins was 22.6% for the year an expansion of 195 basis points YoY.
Wipro declared a final dividend of `5 ($0.08) per share /ADS, taking the total dividend declared during
the year to `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= `60.00. However, the realized exchange rate in our IT Services business segment for the quarter ended March 31, 2014 was US$1= `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 `11.1 billion ($185 million1) for the quarter ended
March 31, 2014, a YoY increase of 3%. Revenue for the year end March 31, 2014 was `38.8 billion
($646 million1), a decrease of 1% YoY.
Earnings Before Interest and Tax (EBIT) for the quarter ended March 31, 2014 was `143 million ($2 million1), a decrease of 47% YoY. EBIT for the year ended March 31, 2014 was `310 million ($5 million1). a decrease of 69% YoY.The operating income of IT Products segment for the year includes non-recurring expense of `209 million ($3 million1) 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 `519 million ($9 million1).
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.
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.
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.
Aravind V S Sridhar Ramasubbu Vipin Nair
Phone: +91-80-25056186 Phone: +1 408-242-6285 Phone: 91-80-3991-6154 aravind.viswanathan@wipro.com sridhar.ramasubbu@wipro.com vipin.nair1@wipro.com
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)
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 |
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 2,313Selling 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 1,490Finance 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 1,684Income tax expense………………………………………… (3,973) (6,536) (109) (16,912) (22,600) (377)
Profit after tax for the period from discontinued operation… 1,535 - - 5,012 - -
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
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
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 operationsBasic………………………………………… 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 RevenueIT 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 IncomeIT 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
WIPRO LIMITED AND SUBSIDIARIES CONDENSED CONSOLIDATED INTERIM STATEMENTS OF INCOME (` in millions, except share and per share data, unless otherwise stated)2013 | 2014 | 2014 | 2013 | 2014 | 2014 | |||||
Convenience translation into US $ in millions | Convenience translation into US $ in millions |
(Unaudited) (Unaudited) 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)
Accelerated amortization of stock options that vest in a
graded manner……………………………………… (1) - - (12) - -
IT Services Revenue as per IFRS | 1,720.2 |
Effect of Foreign currency exchange movement Non-GAAP Constant Currency IT Services Revenue based on previous quarter exchange rates | 2.8 1,717.4 |
IT Services Revenue as per IFRS | 1,720.2 |
Effect of Foreign currency exchange movement Non-GAAP Constant Currency IT Services Revenue based on previous year exchange rates | 11.8 1,732.0 |
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 90,333IT PRODUCTS 11,090 143 38,785 310
RECONCILING ITEM (238) (387) (666) (1,289)
ENTITY TOTAL 117,045 25,810 437,628 89,354|
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