EX-19.1 3 f85044exv19w1.txt EXHIBIT 19.1 Exhibit 19.1 INFOSYS TECHNOLOGIES LIMITED Report for the second quarter ended September 30, 2002 [INFOSYS LOGO] At a glance - Indian GAAP (Non-consolidated financials)
Rs. in crore, except per share data -------------------------------------------------------- Quarter ended Half year ended September 30, September 30, Year ended ---------------- -------------------- March 31, 2002 2001 2002 2001 2002 ------ ------ -------- -------- -------- For the period Total revenue 879.57 650.13 1,644.19 1,262.65 2,603.59 Export revenue 857.23 638.27 1,607.75 1,234.57 2,552.47 Operating profit (PBIDTA) 323.24 258.91 598.17 499.43 1,037.63 PBIDTA/ revenues(%) 36.75% 39.82% 36.38% 39.55% 39.85% Profit after tax (PAT) 225.77 201.56 442.62 391.59 807.96 PAT/revenues(%) 25.67% 31.00% 26.92% 31.01% 31.03% Earnings per share(*)(par value of Rs. 5 each, fully paid) Basic 34.10 30.47 66.87 59.19 122.12 Diluted 33.90 30.39 66.41 59.05 121.37 Dividend per share NA NA 12.50 7.50 20.00 Dividend amount NA NA 82.76 49.63 132.36 Capital expenditure 44.02 129.75 97.80 231.49 322.74 At the end of the period Total assets 2,443.32 1,742.48 2,080.31 Fixed assets - net 753.53 713.65 718.24 Cash and cash equivalents 1,289.34 714.85 1,026.96 Working capital 1,623.01 965.75 1,293.41 Total debt -- -- -- Net worth 2,443.32 1,742.48 2,080.31 Equity 33.10 33.08 33.09 Market capitalization 22,552.46 15,878.57 24,654.33
Note: Market capitalization is calculated by considering the share price at National stock exchange on the shares outstanding at the period/ year end. (*)EPS figures have been calculated for the period and have not been annualized. Total Revenue [PERFORMANCE GRAPH] Year ended March 31, 2002 2,603.59 Quarter ended September 30, 2001 650.13 Quarter ended September 30, 2002 879.57
Exports [PERFORMANCE GRAPH] Year ended March 31, 2002 2,552.47 Quarter ended September 30, 2001 638.27 Quarter ended September 30, 2002 857.23
Net Profit from Ordinary Activities [PERFORMANCE GRAPH] Year ended March 31, 2002 807.96 Quarter ended September 30, 2001 201.56 Quarter ended September 30, 2002 225.77
2 Letter to the shareholder Dear shareholder, We are delighted to report another quarter of robust revenue growth. Our Indian GAAP revenues grew by 15.03% over Q1 FY2003 while net profits from ordinary activities witnessed an increase of 4.11%. Our cash flows during the quarter amounted to Rs. 200.11 crore. Your company has declared an interim dividend of Rs. 12.50 per share (250% on an equity share of par value of Rs. 5 each). Our employee addition during this quarter has been the highest -- gross addition of 2,065 for the quarter, including 328 lateral hires; net employee addition for the quarter stood at 1,806. The economic environment continues to be very challenging. At the same time, there is an increased acceptance of the offshore outsourcing model. Customers are demanding more ROI and reduced risk. In this environment, our superior delivery capabilities and financial strength have accelerated revenue growth beyond our initial projections. In fact, we have increased our guidance for revenue and EPS for this fiscal. Our US GAAP revenues grew by 16.1% for the quarter as compared to the quarter ended June 30, 2002. Revenue growth comprised of a volume growth of 11.7% and a price growth of 4.4%, over the previous quarter. Our utilization rates improved during the quarter and we were able to maintain gross margins despite having an increased share of revenues from onsite work. We enhanced our investments in sales and marketing and we are aggressively pursuing our goal to be an integrated, end-to-end technology solutions provider. We added 18 new clients during the quarter. Significant wins include marquee names such as Porsche AG, the world leader in designing and manufacturing of sports cars, Commonwealth Industries, an aluminum manufacturer in the US, Arrow Electronics in the US, one of the world's largest distributors of electronic components and computer products, Cerebrus Solutions, provider of fraud management solutions for wireless operators, Vcommerce Corporation, a leading supply chain execution solutions provider in the US and The Security Benefit Group of Companies, one of the five largest asset management institutions in Switzerland. Our business consulting services continue to help companies obtain benefits through enterprise-wide initiatives. We defined steps to improve operations and to support expansion plans of the corporate finance division of one of the top three banks in Australia. We created a divisional Balanced Scorecard for the human resources and customer facing units of the fifth largest ocean transportation company in the world. Our banking business further strengthened its presence during the quarter. In Nigeria, we have formed an alliance with Kakawa Discount, a discount house formed by a consortium of key banks. In addition, First Bank of Nigeria, the largest commercial bank in West Africa, signed up for our banking products. Further, UTI Bank became the first client to sign up for the Infosys Loan Origination system built on FINACLE(TM) CRM infrastructure. During the quarter, Phaneesh Murthy resigned from the company's Board of Directors and from his role as Head -- Sales & Marketing and Communications and Product Services (CAPS) effective July 23, 2002. We appointed Basab Pradhan as Senior Vice President and Head -- Worldwide Sales, taking over part of Phaneesh Murthy's portfolio. In the sexual harassment litigation that the company is facing, we initiated voluntary settlement discussions with the plaintiff. However, it appears that the settlement may not be possible in the near term and the lawsuit may go to trial. No trial date has been set yet. We will vigorously defend this matter. However, the results of such a lawsuit are difficult to predict. Accordingly, an unfavorable resolution of this lawsuit could adversely impact our results of operations or our financial condition. During the quarter, we were assessed at Level 5 on the SEI PCMM model, becoming the first company in the world to be assessed at the Optimizing level on the updated version 2.0 of the model. The model helps us increase our ability to attract, develop, motivate, organize and retain the talent needed to continuously improve our software development capabilities. Overall, it has been an exciting quarter of growth. Infoscions, through their hard work and dedication have helped achieve this. On your behalf, we thank our fellow Infoscions for their continuing efforts to delight our customers. /s/ S. GOPALAKRISHNAN /s/ NANDAN M. NILEKANI ---------------------------- ---------------------------------- Bangalore S. Gopalakrishnan Nandan M. Nilekani October 10, 2002 Chief Operating Officer Chief Executive Officer, President and Deputy Managing Director and Managing Director
3 Auditors' report We have audited the attached Balance Sheet of Infosys Technologies Limited (the Company) as at September 30, 2002, the Profit and Loss Accounts and Cash Flow Statements of the Company for the quarter and half-year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. We report as follows: (a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; (b) in our opinion, proper books of account have been kept by the Company so far as appears from our examination of those books; (c) the Balance Sheet and the Profit and Loss Accounts dealt with by this report are in agreement with the books of account; (d) in our opinion, the Balance Sheet, the Profit and Loss Accounts and the Cash Flow Statements comply with the Accounting Standards issued by the Institute of Chartered Accountants of India, to the extent applicable; and (e) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give a true and fair view in conformity with the accounting principles generally accepted in India: (i) in the case of the Balance Sheet, of the state of affairs of the Company as at September 30, 2002; (ii) in the case of the Profit and Loss Accounts, of the profit of the Company for the quarter and half year ended on that date; and (iii) in the case of the Cash Flow Statements, of the cash flows of the Company for the quarter and half year ended on that date. for Bharat S Raut & Co. Chartered Accountants S Balasubrahmanyam Partner Bangalore October 10, 2002 4 Balance sheet as at
in Rs. crore ------------------------------- September 30, ------------------- March 31, 2002 2001 2002 -------- -------- -------- SOURCES OF FUNDS SHAREHOLDERS' FUNDS Share capital 33.10 33.08 33.09 Reserves and surplus 2,410.22 1,709.40 2,047.22 -------- -------- -------- 2,443.32 1,742.48 2,080.31 ======== ======== ======== APPLICATION OF FUNDS FIXED ASSETS Original cost 1,137.72 788.09 960.60 Less: Depreciation and amortization 476.54 310.63 393.03 -------- -------- -------- Net book value 661.18 477.46 567.57 Add: Capital work-in-progress 92.35 236.19 150.67 -------- -------- -------- 753.53 713.65 718.24 INVESTMENTS 33.20 44.44 44.44 DEFERRED TAX ASSETS 33.58 18.64 24.22 CURRENT ASSETS, LOANS AND ADVANCES Sundry debtors 458.25 343.60 336.73 Cash and bank balances 986.85 427.69 772.22 Loans and advances 870.16 623.26 643.87 -------- -------- -------- 2,315.26 1,394.55 1,752.82 Less: Current liabilities 262.36 179.75 126.11 Provisions 429.89 249.05 333.30 -------- -------- -------- NET CURRENT ASSETS 1,623.01 965.75 1,293.41 -------- -------- -------- 2,443.32 1,742.48 2,080.31 ======== ======== ========
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS The schedules referred to above and the notes thereon form an integral part of the Balance sheet. This is the Balance sheet referred to in our report of even date. for Bharat S Raut & Co. Chartered Accountants S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director President and Managing Deputy Managing Director Director Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler Director Director Director Director Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal Director Director Director Director T. V. Mohandas Pai Srinath Batni V. Balakrishnan Bangalore Director and Chief Director Company Secretary and October 10, 2002 Financial Officer Vice President - Finance
5 Profit and loss account for the
in Rs. crore except per share data ---------------------------------------------------------------------- Quarter ended Half year ended September 30, September 30, Year ended ------------------------- -------------------------- March 31, 2002 2001 2002 2001 2002 ----------- ----------- ----------- ----------- ----------- INCOME Software services and products Overseas 857.23 638.27 1,607.75 1,234.57 2,552.47 Domestic 22.34 11.86 36.44 28.08 51.12 ----------- ----------- ----------- ----------- ----------- 879.57 650.13 1,644.19 1,262.65 2,603.59 SOFTWARE DEVELOPMENT EXPENSES 424.49 306.95 801.88 592.51 1,224.82 ----------- ----------- ----------- ----------- ----------- GROSS PROFIT 455.08 343.18 842.31 670.14 1,378.77 SELLING AND MARKETING EXPENSES 69.33 33.46 124.42 61.11 129.79 GENERAL AND ADMINISTRATION EXPENSES 62.51 50.81 119.72 109.60 211.35 ----------- ----------- ----------- ----------- ----------- 131.84 84.27 244.14 170.71 341.14 OPERATING PROFIT (PBIDTA) 323.24 258.91 598.17 499.43 1,037.63 Interest -- -- -- -- -- Depreciation & amortization 46.24 39.01 86.71 74.49 160.65 ----------- ----------- ----------- ----------- ----------- OPERATING PROFIT AFTER INTEREST, DEPRECIATION AND AMORTIZATION 277.00 219.90 511.46 424.94 876.98 Other income 17.53 14.66 42.42 28.15 66.41 Provision for investments 23.76 -- 23.76 -- -- ----------- ----------- ----------- ----------- ----------- PROFIT BEFORE TAX 270.77 234.56 530.12 453.09 943.39 Provision for taxation 45.00 33.00 87.50 61.50 135.43 ----------- ----------- ----------- ----------- ----------- NET PROFIT AFTER TAX 225.77 201.56 442.62 391.59 807.96 ----------- ----------- ----------- ----------- ----------- AMOUNT AVAILABLE FOR APPROPRIATION 225.77 201.56 442.62 391.59 807.96 ----------- ----------- ----------- ----------- ----------- DIVIDEND Interim 82.76 49.63 82.76 49.63 49.63 Final -- -- -- -- 82.73 Dividend Tax -- 5.06 -- 5.06 5.06 Amount transferred - general reserve -- -- -- -- 670.54 Balance in Profit and Loss Account 143.01 146.87 359.86 336.90 -- ----------- ----------- ----------- ----------- ----------- 225.77 201.56 442.62 391.59 807.96 =========== =========== =========== =========== =========== EARNINGS PER SHARE (Equity shares, par value Rs. 5 each) Basic 34.10 30.47 66.87 59.19 122.12 Diluted 33.90 30.39 66.41 59.05 121.37 Number of shares used in computing earnings per share Basic 6,61,98,735 6,61,60,717 6,61,93,632 6,61,59,892 6,61,62,274 Diluted 6,65,96,469 6,63,34,606 6,66,51,932 6,63,12,732 6,65,67,575 =========== =========== =========== =========== ===========
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS The schedules referred to above and the notes thereon form an integral part of the Profit and Loss Account. This is the Profit and Loss Account referred to in our report of even date. For Bharat S. Raut & Co. Chartered Accountants S. Balasubrahmanyam N.R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director President and Managing Deputy Managing Director Director Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler Director Director Director Director Claude Smadja Rama Bijapurkar K. Dinesh S.D. Shibulal Director Director Director Director T.V. Mohandas Pai Srinath Batni V. Balakrishnan Bangalore Director and Chief Director Company Secretary and October 10, 2002 Financial Officer Vice President - Finance
6 Schedules to the profit and loss account for the
in Rs. crore ---------------------------------------------------------------- Quarter ended Half year ended September 30, September 30, Year ended -------------------- -------------------- March 31, 2002 2001 2002 2001 2002 ------ ------ ------ ------ ----------- SOFTWARE DEVELOPMENT EXPENSES Salaries and bonus including overseas staff expenses 343.27 242.54 640.92 466.98 976.11 Staff welfare 1.60 1.59 3.29 3.45 6.14 Contribution to provident and other funds 6.81 6.32 13.27 12.48 25.63 Foreign travel expenses 41.22 29.27 78.28 56.47 113.12 Consumables 1.26 0.69 2.42 1.08 3.22 Cost of software packages for own use 11.30 9.10 21.06 17.06 34.44 service delivery to clients 0.74 2.04 7.62 6.05 9.17 Provision for post-sales client support (2.27) 0.95 (0.30) 1.05 3.65 Computer maintenance 2.52 1.72 4.38 2.90 7.11 Communication expenses 5.09 10.51 12.26 20.73 36.11 Consultancy charges 12.95 2.22 18.68 4.26 10.12 ------ ------ ------ ------ ------ 424.49 306.95 801.88 592.51 1,224.82 ====== ====== ====== ====== ======== SELLING AND MARKETING EXPENSES Salaries and bonus including overseas staff expenses 32.96 14.69 63.01 30.52 61.04 Staff welfare 0.18 0.05 0.31 0.17 0.27 Contribution to provident and other funds 0.15 0.06 0.24 0.08 0.22 Foreign travel expenses 9.90 3.94 18.59 7.49 18.66 Consumables 0.05 0.01 0.07 0.01 0.02 Cost of software packages for own use 0.02 0.04 0.03 0.07 0.58 Communication expenses 0.18 0.09 0.24 0.09 0.38 Traveling and conveyance 0.30 1.47 0.45 2.37 3.14 Rent 1.20 1.56 2.11 2.62 4.30 Telephone charges 1.46 0.79 2.52 1.52 3.26 Professional charges 2.97 1.45 5.24 2.11 5.90 Printing and stationery 0.40 0.37 0.77 0.74 1.55 Advertisements 0.24 0.03 0.40 0.03 0.31 Brand building 9.37 5.80 17.36 7.66 13.16 Office maintenance 0.35 0.06 0.50 0.13 0.31 Repairs to plant and machinery -- -- -- 0.01 0.01 Power and fuel 0.07 0.02 0.11 0.04 0.06 Insurance charges 0.01 -- 0.03 -- -- Rates and taxes 0.12 0.01 0.23 0.24 0.33 Bank charges and commission 0.03 0.01 0.04 0.02 0.03 Commission charges 4.70 1.49 6.22 2.01 10.82 Marketing expenses 2.20 1.11 3.31 2.65 4.67 Sales promotion expenses 0.05 0.10 0.20 0.21 0.44 Other miscellaneous expenses 2.42 0.31 2.44 0.32 0.33 ------ ------ ------ ------ ------ 69.33 33.46 124.42 61.11 129.79 ====== ====== ====== ====== ======
7 Schedules to the profit and loss account for the
in Rs. crore -------------------------------------------------------------- Quarter ended Half year ended September 30, September 30, Year ended ------------------- -------------------- March 31, 2002 2001 2002 2001 2002 ----- ----- ----- ----- --------- GENERAL AND ADMINISTRATION EXPENSES Salaries and bonus including overseas staff expenses 14.17 11.92 26.38 22.81 45.48 Contribution to provident and other funds 0.75 0.83 1.54 1.67 2.98 Foreign travel expenses 2.15 1.02 3.95 2.51 4.81 Traveling and conveyance 3.74 4.13 6.66 7.44 15.48 Rent 5.52 3.96 10.75 9.41 20.11 Telephone charges 5.37 3.25 9.01 6.76 11.45 Professional charges 7.98 3.29 14.51 6.48 16.23 Printing and stationery 1.01 0.65 2.66 3.42 4.75 Advertisements 1.02 0.81 1.67 1.42 2.78 Office maintenance 3.98 3.30 7.91 6.58 13.81 Repairs to building 1.15 1.57 3.02 3.79 8.50 Repairs to plant and machinery 0.93 0.78 2.09 1.26 2.48 Power and fuel 5.32 4.74 10.98 9.35 18.90 Insurance charges 2.48 1.22 4.46 2.50 5.34 Rates and taxes 1.10 1.02 2.27 1.69 3.93 Donations 1.37 1.56 3.04 3.99 5.12 Auditor's remuneration audit fees 0.07 0.05 0.13 0.10 0.21 certification charges -- -- -- -- 0.02 out-of-pocket expenses -- 0.01 0.01 0.02 0.02 Bad loans and advances written off -- -- -- -- -- Bad debts written off -- -- -- -- -- Provision for bad and doubtful debts 0.11 3.53 0.18 10.47 13.09 Provision for doubtful loans and advances (0.01) 0.06 (0.05) 0.06 0.42 Bank charges and commission 0.16 0.08 0.32 0.12 0.68 Commission to non-whole time directors 0.24 0.24 0.48 0.48 0.98 Postage and courier 0.72 0.76 1.97 1.93 3.23 Books and periodicals 0.40 0.25 0.65 0.58 1.14 Research grants -- 0.25 -- 0.50 0.75 Freight charges 0.16 0.10 0.27 0.22 0.52 Professional membership and seminar participation fees 0.83 0.37 1.65 0.91 2.20 Transaction processing fee and filing fees 1.45 0.90 2.70 2.28 4.78 Other miscellaneous expenses 0.34 0.16 0.51 0.85 1.16 ----- ----- ------ ------ ------ 62.51 50.81 119.72 109.60 211.35 ===== ===== ====== ====== ====== OTHER INCOME Interest received on deposits with banks and others(*) 18.69 11.79 36.37 23.60 51.23 Miscellaneous income 0.47 0.31 1.18 0.73 1.92 Exchange differences (1.63) 2.56 4.87 3.82 13.26 ----- ----- ----- ----- ----- 17.53 14.66 42.42 28.15 66.41 ===== ===== ===== ===== ===== (*) Tax deducted at source 3.21 2.08 6.43 3.79 8.28 PROVISION FOR TAXATION Current period/year Income taxes 53.74 35.05 96.86 64.61 143.19 Deferred taxes (8.74) (2.05) (9.36) (3.11) (7.76) ----- ----- ----- ----- ------ 45.00 33.00 87.50 61.50 135.43 ===== ===== ===== ===== ======
8 1. Extracts of significant accounting policies and notes on accounts Company overview Infosys Technologies Limited ("Infosys" or the "company"), a world leader in consulting and information technology ("IT") services partners with Global 2000 companies to provide business consulting, systems integration, application development, maintenance, re-engineering and product engineering services. Through these services, Infosys enables its clients to fully exploit technology for business transformation. Clients leverage Infosys' Global Delivery Model to achieve higher quality, improved time-to-market and cost-effective solutions. Management's Statement on significant accounting policies contained in the audited financial statements. There are no changes in the accounting policies during the quarter ended September 30, 2002. The significant accounting policies of the company relate to revenue recognition, expenditure, fixed assets and capital work-in -progress, depreciation, retirement benefits to employees - principally gratuity, superannuation and provident fund benefits, research and development, income tax, earning per share, foreign currency transactions and investments. 1.1 Significant accounting policies 1.1.1 Basis of preparation of financial statements The financial statements are prepared under the historical cost convention, in accordance with Indian Generally Accepted Accounting Principles ("GAAP") on the accrual basis. GAAP comprises mandatory accounting standards issued by the Institute of Chartered Accountants of India ("ICAI") and the provisions of the Companies Act, 1956. These accounting policies have been consistently applied, except for applicable recently issued accounting standards made mandatory by the ICAI effective the current fiscal year that were adopted by the company, as described below. All amounts are stated in Indian Rupees, except as otherwise specified. Effective the current fiscal year, the company has voluntarily adopted the applicable accounting standard on intangible assets, which is mandatory effective the year commencing April 1, 2003. Management has also evaluated the effect of the other recently issued accounting standards such as discontinuing operations and reporting of interests in joint ventures (although all these accounting standards are not mandatory for the fiscal year ending 2003). These accounting standards do not have a material impact on the financial statements of the company. The preparation of the financial statements in conformity with GAAP requires that the management of the company ("Management") make estimates and assumptions that affect the reported amounts of income and expenses of the period, reported balances of assets and liabilities and disclosures relating to contingent assets and liabilities as of the date of the financial statements. Examples of such estimates include expected development costs to complete software contracts, provisions for doubtful debts, future obligations under employee retirement benefit plans, income taxes, provision for post sales customer support and the useful lives of fixed assets and intangible assets. Actual results could differ from those estimates. Contingencies are recorded when it is probable that a liability has been incurred, and the amount can be reasonably estimated. 1.2 Notes on accounts Pursuant to an application by the management, the Department of Company Affairs in their letter of January 23, 2002 granted the company approval to present the financial statements in Rupees crore. Accordingly, all amounts in the financial statements are presented in Rupees crore, except for per share data and as otherwise stated. All exact amounts are stated with the suffix "/-". One crore equals 10 million. The previous period's/year's figures have been regrouped/reclassified, wherever necessary, to conform to the current period's/year's presentation. 1.2.1 Aggregate expenses Following are the aggregate amounts incurred on certain specific expenses that are required to be disclosed under Schedule VI to the Companies Act, 1956:
Quarter ended Half year ended September 30, September 30, Year ended ------------------- ------------------ March 31, 2002 2001 2002 2001 2002 ------ ------ ------ ------ -------- Salaries and bonus including overseas staff expenses 390.40 269.15 730.31 521.94 1,082.63 Staff welfare 1.78 1.64 3.60 1.98 6.41 Contribution to provident and other funds 7.71 7.21 15.05 14.22 28.83 Foreign travel expenses 53.27 34.23 100.82 66.47 136.59 Consumables 1.31 0.70 2.49 1.09 3.24 Cost of software packages for -- own use 11.32 9.14 21.09 17.13 35.02 Cost of software packages for service delivery to clients 0.74 2.04 7.62 6.05 9.17 Computer maintenance 2.52 1.72 4.38 2.90 7.11 Communication expenses 5.27 10.60 12.50 20.82 36.49 Consultancy charges 12.95 2.22 18.68 4.26 10.12 Provision for post-sales client support (2.27) 0.95 (0.30) 1.05 3.65 Traveling and conveyance 4.04 5.60 7.11 9.81 18.62 Rent 6.72 5.52 12.86 12.03 24.41 Telephone charges 6.83 4.04 11.53 8.28 14.71 Professional charges 10.95 4.74 19.75 8.60 22.13 Printing and stationery 1.41 1.02 3.43 4.16 6.30 Advertisements 1.26 0.84 2.07 1.45 3.09 Office maintenance 4.33 3.36 8.41 6.70 14.12 Repairs to building 1.15 1.57 3.02 3.79 8.50 Repairs to plant and machinery 0.93 0.78 2.09 1.27 2.49 Power and fuel 5.39 4.76 11.09 9.40 18.96 Brand building 9.37 5.80 17.36 7.66 13.16 Insurance charges 2.49 1.22 4.49 2.51 5.34 Rates and taxes 1.22 1.03 2.50 1.93 4.26 Commission charges 4.70 1.49 6.22 2.01 10.82 ------ ------ ------ ------ --------
9 1.2.1 Aggregate expenses (continued)
Quarter ended Half year ended September 30, September 30, Year ended ------------------- -------------------- March 31, 2002 2001 2002 2001 2002 ------ ------ -------- ------ -------- Donations 1.37 1.56 3.04 3.99 5.12 Auditor's remuneration -- audit fees 0.07 0.05 0.13 0.10 0.21 certification charges -- -- -- -- 0.02 out-of-pocket expenses -- 0.01 0.01 0.01 0.02 Provision for bad and doubtful debts 0.11 3.53 0.18 10.47 13.09 Provision for doubtful loans and advances (0.01) 0.06 (0.05) 0.06 0.42 Bank charges and commission 0.19 0.09 0.36 0.14 0.71 Commission to non-whole time directors 0.24 0.24 0.48 0.48 0.98 Postage and courier 0.72 0.76 1.97 1.98 3.23 Books and periodicals 0.40 0.25 0.65 0.60 1.14 Research grants -- 0.25 -- 0.50 0.75 Freight charges 0.16 0.10 0.27 0.21 0.52 Professional membership and seminar participation fees 0.83 0.37 1.65 1.06 2.20 Marketing expenses 2.20 1.11 3.31 2.65 4.67 Sales promotion expenses 0.05 0.10 0.20 0.21 0.44 Transaction processing fee and filing fees 1.45 0.90 2.70 2.29 4.78 Other miscellaneous expenses 2.76 0.47 2.95 0.96 1.49 ------ ------ -------- ------ -------- 556.33 391.22 1,046.02 763.22 1,565.96 ====== ====== ======== ====== ========
1.2.2 Obligations on long-term non-cancelable operating leases The lease rentals charged during the period and maximum obligations on long-term non-cancelable operating leases payable as per the rentals stated in the respective agreements are as follows:
Quarter ended Half year ended September 30, September 30, Year ended ------------- --------------- March 31, 2002 2001 2002 2001 2002 ---- ---- ----- ----- ---------- Lease rentals recognized during the period/year 6.72 5.52 12.86 12.03 24.41 ---- ---- ----- ----- ----- Lease obligations Within one year of the balance sheet date 16.83 15.90 16.95 Due in a period between one year and five years 39.00 54.72 46.90 Due after five years 5.98 15.08 7.20 ---- ---- ----- ----- -----
The operating lease arrangements extend for a maximum of ten years from their respective dates of inception and relate to rented overseas premises. Lease rental commitments on a contract with Progeon Limited ("Progeon"), a subsidiary company, as at September 30, 2002 due to Infosys within one year of the balance sheet date amounted to Rs. 1.64 and due in the period between one year and five years amounted to Rs. 2.73. The lease for premises extends for a maximum period of three years from quarter ended June 30, 2002 (the period of inception). Fixed Assets stated below have been provided on operating lease to Progeon, which is under the same management, as at September 30, 2002:
Particulars Original cost Accumulated depreciation Net book value ----------- ------------- ------------------------ -------------- Building 9.59 0.27 9.32 Plant and machinery 2.42 0.27 2.15 Computers 0.78 0.12 0.66 Furniture & fixtures 1.74 0.26 1.48 ----- ---- ----- Total 14.53 0.92 13.61 ----- ---- -----
The aggregate depreciation charged on the above assets for the quarter and half-year ended September 30, 2002 amounted to Rs. 0.69 and Rs. 0.92 respectively. The rental income from Progeon for the quarter and half-year ended September 30, 2002 amounted to Rs. 0.41 and Rs. 0.55 respectively. 1.2.3 Related party transactions The company entered into related party transactions during the year ended March 31, 2002 with Yantra Corporation, USA, the subsidiary of the company until February 27, 2002, and key management personnel. The transactions with Yantra Corporation comprise sales of Rs. 4.43 during the period from April 1, 2001 until February 27, 2002. The outstanding dues from Yantra Corporation as at September 30, 2002 were Rs.0.45. Such dues as at September 30, 2001 were Rs.0.52 and as at March 31, 2002 were Rs. 0.34. The company entered into related party transactions during the period ended September 30, 2002 with Progeon, the subsidiary company, under the same management. The transactions are set out below.
Quarter ended Half year ended Particulars September 30, 2002 September 30, 2002 ----------- ------------------ ------------------- Capital transactions: Financing transactions -- amount paid to Progeon for issue of 1,22,49,993 fully paid equity shares of Rs. 10/- each at par -- 12.25 ---- ----- Revenue transactions: Purchase of services 1.87 2.08 ---- ----- Sale of services Business consulting services 0.99 1.11 Shared services including facilities and personnel 1.64 2.37 ---- ----- 2.63 3.48 ---- -----
10 During the quarter ended September 30, 2002 and half-year ended September 30, 2002 an amount of Rs. 1.28 and Rs. 2.53 respectively has been donated to Infosys Foundation a not-for-profit trust, in which certain directors of the company are trustees. Donation to the foundation for the quarter ended September 30, 2001 half-year ended September 30, 2001 and year ended March 31, 2002 were Rs. 1.00, Rs. 3.00 and Rs. 3.75 respectively. 1.2.4 Transactions with key management personnel Our policy in determining our executive officers for reporting purposes has traditionally been to include all statutory officers and all members of our Management Council. As of April, 2002 in line with our growth and strategic objectives, we divided our Management Council into two levels comprising of senior executives and all other members. In accordance with this policy, our directors and executive officers, which include only senior members of our Management Council, who we believe are our key management personnel. Particulars of remuneration and other benefits provided to key management personnel during the quarters ended September 30, 2002, 2001, half-year ended September 30, 2002, 2001 and the year ended March 31, 2002, are set out below.
Contributions to provident Perquisites Sitting Reimbursement Total Salary and other funds and incentives Commission(*) fees of expenses remuneration ------ --------------- -------------- ------------- ------- ------------- ------------ Executive Directors Quarter ended September 30, 2002 1.12 0.06 0.54 -- -- -- 1.72 Quarter ended September 30, 2001 0.43 0.07 0.16 -- -- -- 0.66 Half year ended September 30, 2002 1.77 0.11 1.34 -- -- -- 3.22 Half year ended September 30, 2001 0.88 0.12 0.83 -- -- -- 1.83 Year ended March 31, 2002 2.02 0.21 1.07 -- -- -- 3.30 ==== ==== ==== ==== ==== ==== ==== Independent Directors Quarter ended September 30, 2002 -- -- -- -- -- -- 0.10 Quarter ended September 30, 2001 -- -- -- -- -- -- 0.09 Half year ended September 30, 2002 -- -- -- -- -- -- 0.31 Half year ended September 30, 2001 -- -- -- -- -- -- 0.18 Year ended March 31, 2002 -- -- -- 0.96 0.06 0.27 1.29 ---- ---- ---- ---- ---- ---- ----
(*) An amount of Rs. 0.24 and Rs. 0.48 provided during the quarter and half-year ended September 30, 2002, such provision for the quarter and half-year ended September 30, 2001 were Rs. 0.24 and Rs. 0.48 and for the year ended March 31, 2002, Rs. 0.96.
Contributions Outstanding to provident Perquisites Total Total loans and Salary and other funds and incentives remuneration loans granted advances ------ --------------- -------------- ------------ ------------- ----------- Other Senior Management Personnel Quarter ended September 30, 2002 0.30 0.05 0.11 0.46 -- 0.07 Quarter ended September 30, 2001 0.26 0.05 0.11 0.42 -- 0.09 Half year ended September 30, 2002 0.60 0.05 0.32 0.97 -- 0.07 Half year ended September 30, 2001 0.55 0.05 0.38 0.98 -- 0.09 Year ended March 31, 2002 1.10 0.11 0.79 2.00 -- 0.08 ==== ==== ==== ==== ==== ====
In addition, the details of the only options granted to non-wholetime directors and other senior officers during the quarters ended September 30, 2002, 2001, half-year ended September 30, 2002, 2001 and the year ended March 31, 2002 are as follows:
Number of Exercise price Expiration of Date of Grant Option plan options granted (in Rs.) options -------------- ----------- --------------- ------------- ---------------- Non-Wholetime Directors Deepak M Satwalekar April 11, 2001 1999 7,000 3,215.60 April 11, 2011 Marti G Subrahmanyam April 11, 2001 1999 6,000 3,215.60 April 11, 2011 Philip Yeo April 11, 2001 1999 3,000 3,215.60 April 11, 2011 Jitendra Vir Singh April 11, 2001 1999 2,000 3,215.60 April 11, 2011 Omkar Goswami April 11, 2001 1999 2,000 3,215.60 April 11, 2011 Larry Pressler April 11, 2001 1999 2,000 3,215.60 April 11, 2011 Rama Bijapurkar April 11, 2001 1999 2,000 3,215.60 April 11, 2011 Claude Smadja July 10, 2002 1999 2,000 3,333.65 October 24, 2011 Other Senior Management Personnel Girish G Vaidya October 29, 2001 1999 3,000 3,106.75 October 29, 2011 Basab Pradhan October 27, 2001 1998 4,000 2,366.85 October 27, 2011 Company Secretary V Balakrishnan October 29, 2001 1999 2,000 3,106.75 October 29, 2011 ---------------- ---- ----- -------- ----------------
1.2.5 Pro-forma disclosures relating to the Employee Stock Option Plans ("ESOPs") The company's 1994 stock option plan was established prior to the SEBI guidelines on stock options. Had the stock compensation costs for this stock option plan been determined as per the guidelines issued by SEBI, the company's reported net profit would have been reduced to the pro forma amounts indicated below.
Quarter ended Half year ended September 30, September 30, Year ended ------------------ ------------------ March 31, 2002 2001 2002 2001 2002 ------ ------ ------ ------ ---------- Net profit: - As reported 225.77 201.56 442.62 391.59 807.96 - Adjusted pro forma 219.73 195.64 430.50 379.76 784.18 ------ ------ ------ ------ ------
11 1.2.6 Intangible assets During the first quarter, the company acquired the intellectual property rights of Trade IQ product from IQ Financial Systems Inc., USA for its banking group. The consideration paid amounts to Rs. 14.12 (US$ 2.88 million). An additional US$ 1 million (Rs. 4.88 as at September 30, 2002) has been retained in escrow for payment to the seller based on the successful renewal of certain customer contracts in favor of the company. The consideration has been recorded as an intangible asset, which is being amortized over two years representing management's estimate of the useful life of the intellectual property. The company also entered into an agreement in the first quarter, with the Aeronautical Development Agency, India ("ADA") for transferring the intellectual property rights in AUTOLAY, a commercial software application product used in the design of high performance structural systems. The company will pay the consideration in the form of a revenue share with a firm commitment of US$ 5 million (Rs. 24.50) payable by 10 years of the contract date. The ownership of intellectual property in AUTOLAY transfers to the company on remittance of the consideration to ADA. The committed consideration of Rs. 24.50 has been recorded as an intangible asset and is being amortized over five years, which is management's estimate of the useful life. 1.2.7 Investment activity Progeon was incorporated on April 3, 2002, and is a majority owned and controlled subsidiary, established to provide business process management and transitioning services. As at the balance sheet date, the company has invested Rs. 12.25 in 1,22,49,993 fully paid equity shares in Progeon of face value Rs. 10/- each, at par. Progeon seeks to leverage the benefits of service delivery globalization, process redesign and technology to drive efficiency and cost effectiveness in customer business processes. Progeon obtained its financial closure by securing funding of Rs. 49.00 from Citicorp International Finance Corporation, USA ("CIFC") in exchange for 43,75,000 cumulative, convertible, redeemable preferred shares of face value Rs. 100/- at a premium of Rs. 12/ - per share. The preference shares are convertible to an equal number of equity shares based on certain events as agreed between the company and CIFC. During the half-year ended September 30, 2002 the company invested Rs. 0.27 in M-Commerce Ventures Pte Limited, Singapore ("M-Commerce") for 10 ordinary shares of face value Singapore $ ("S$") 1/- each fully paid at par and 90 redeemable preference shares of face value S$ 1/- each fully paid for a premium of S$ 1,110. Accordingly, the aggregate investment in M-Commerce as at September 30, 2002 amounts to Rs. 2.11 (Rs. 1.84 as at September 30, 2001 and March 31, 2002). 1.2.8 Segment reporting The company's operations predominantly relate to providing IT services, delivered to customers globally operating in various industry segments. Accordingly, IT service revenues represented along industry classes comprise the primary basis of segmental information set out in these financial statements. Secondary segmental reporting is performed on the basis of the geographical location of customers. The accounting principles consistently used in the preparation of the financial statements are also consistently applied to record income and expenditure in individual segments. These are as set out in the note on significant accounting policies. Industry segments at the company are primarily financial services comprising customers providing banking, finance and insurance services; manufacturing companies; companies in the telecommunications and the retail industries; and others such as utilities, transportation and logistics companies. Income and direct expenses in relation to segments is categorized based on items that are individually identifiable to that segment, while the remainder of the costs are categorized in relation to the associated turnover of the segment. Certain expenses such as depreciation, which form a significant component of total expenses, are not specifically allocable to specific segments as the underlying services are used interchangeably. The company believes that it is not practical to provide segment disclosures relating to those costs and expenses, and accordingly these expenses are separately disclosed as "unallocated" and directly charged against total income. Fixed assets used in the company's business or liabilities contracted have not been identified to any of the reportable segments, as the fixed assets and services are used interchangeably between segments. Accordingly, no disclosure relating to total segment assets and liabilities are made. Customer relationships are driven based on the location of the respective client. North America comprises the United States of America, Canada and Mexico; Europe includes continental Europe (both the east and the west), Ireland and the United Kingdom; and the Rest of the World comprising all other places except those mentioned above and India. Geographical revenues are segregated based on the location of the customer who is invoiced or in relation to which the revenue is otherwise recognized. Industry segments Quarter ended September 30, 2002, September 30, 2001, Half year ended September 30, 2002, September 30, 2001 and year ended March 31, 2002
Financial services Manufacturing Telecom Retail Others Total ------------------ ------------- -------- ------ ------ ------ Revenues 339.61 150.46 128.45 99.21 161.84 879.57 248.44 111.84 99.39 74.75 115.71 650.13 621.46 276.13 244.59 187.77 314.24 1,644.19 474.02 224.24 201.67 142.79 219.93 1,262.65 953.98 445.94 406.79 320.40 476.48 2,603.59 Identifiable operating expenses 139.84 61.38 44.87 30.74 62.17 339.00 89.88 47.01 27.00 20.63 43.90 228.42 256.91 115.45 83.50 59.97 116.27 632.10 168.04 91.62 52.93 38.78 80.45 431.82 355.38 181.92 114.13 89.43 166.37 907.23 Allocated expenses 84.92 36.90 31.50 24.33 39.68 217.33 63.47 27.66 24.58 18.48 28.61 162.80 162.30 67.93 60.18 46.20 77.31 413.92 128.09 57.86 52.06 36.77 56.62 331.40 247.73 111.26 101.50 79.61 118.63 658.73 Segmental operating income 114.85 52.18 52.08 44.14 59.99 323.24 95.09 37.17 47.81 35.64 43.20 258.91 202.25 92.75 100.91 81.60 120.66 598.17 177.89 74.76 96.68 67.24 82.86 499.43 350.87 152.76 191.16 151.36 191.48 1,037.63 ------ ------ ------ ------ ------ --------
12 Industry segments (continued)
Quarter ended Half year ended September 30, September 30, Year ended ------------------- ------------------- March 31, 2002 2001 2002 2001 2002 ------ ------ ------ ------ ------ Unallocable expenses 46.24 39.01 86.71 74.49 160.65 Operating income 277.00 219.90 511.46 424.94 876.98 Other income (expense), net (6.23) 14.66 18.66 28.15 66.41 Net profit before taxes 270.77 234.56 530.12 453.09 943.39 Income taxes 45.00 33.00 87.50 61.50 135.43 ------ ------ ------ ------ ------ Net profit after taxes 225.77 201.56 442.62 391.59 807.96 ====== ====== ====== ====== ======
Geographic segments Quarter ended September 30, 2002, September 30, 2001, Half year ended September 30, 2002, September 30, 2001 and year ended March 31, 2002
North America Europe India Rest of the World Total ------------- ------- ------- ----------------- --------- Revenues 648.01 144.94 22.35 64.27 879.57 462.51 122.87 11.86 52.89 650.13 1,200.57 292.44 36.45 114.73 1,644.19 904.60 244.28 28.08 85.69 1,262.65 1,854.10 506.84 51.12 191.53 2,603.59 Identifiable operating expenses 260.29 48.76 6.72 23.23 339.00 160.95 46.10 4.93 16.44 228.42 476.70 103.17 12.60 39.63 632.10 303.13 89.14 9.77 29.78 431.82 646.90 181.55 19.98 58.80 907.23 Allocated expenses 161.04 36.02 5.00 15.27 217.33 115.78 30.76 3.38 12.88 162.80 298.84 72.80 11.04 31.24 413.92 235.90 63.75 9.53 22.22 331.40 468.20 127.97 14.82 47.74 658.73 Segmental operating income 226.68 60.16 10.63 25.77 323.24 185.78 46.01 3.55 23.56 258.91 425.03 116.47 12.81 43.86 598.17 365.57 91.39 8.78 33.69 499.43 739.00 197.32 16.32 84.99 1,037.63 -------- ------ ----- ------ --------
Quarter ended Half year ended September 30, September 30, Year ended ------------------- ------------------ March 31, 2002 2001 2002 2001 2002 ------ ------ ------ ------ ---------- Unallocable expenses 46.24 39.01 86.71 74.49 160.65 Operating income 277.00 219.90 511.46 424.94 876.98 Other income (expense), net (6.23) 14.66 18.66 28.15 66.41 Net profit before taxes 270.77 234.56 530.12 453.09 943.39 Income taxes 45.00 33.00 87.50 61.50 135.43 ------ ------ ------ ------ ------ Net profit after taxes 225.77 201.56 442.62 391.59 807.96 ====== ====== ====== ====== ======
1.2.9 Provisions for investments The Company evaluates all investments for any diminution in their carrying values that is other than temporary. Accordingly, the company provided for an aggregate amount of Rs. 23.76, which consists of Rs.0.75 to JASDIC Park Company, Japan; Rs. 6.85 to Asia Net Media (BVI) Ltd, the British Virgin Islands; Rs. 8.95 to OnMobile Systems Inc (formerly OnScan Inc), USA; Rs.7.21 to Workadia Inc., U.S.A.; Rs.10,350/- to The Saraswat Co-operative Bank Limited and Rs.10/- to Software Services Support Education Center Limited, during the quarter ended September 30, 2002. 1.2.10 Reconciliation of basic and diluted shares used in computing earnings per share
Quarter ended Half year ended September 30, September 30, Year ended -------------------------- --------------------------- March 31, 2002 2001 2002 2001 2002 ----------- ----------- ----------- ----------- ----------- Number of shares considered as basic weighted average shares outstanding 6,61,98,735 6,61,60,717 6,61,93,632 6,61,59,892 6,61,62,274 Add: Effect of dilutive issues of shares/stock options 3,97,734 1,73,889 4,58,300 1,52,840 4,05,301 ----------- ----------- ----------- ----------- ----------- Number of shares considered as weighted average shares and potential shares outstanding 6,65,96,469 6,63,34,606 6,66,51,932 6,63,12,732 6,65,67,575 ----------- ----------- ----------- ----------- -----------
A complete set of the audited financial statements is available at www.infosys.com 13 Cash flow statement for the
in Rs. crore ------------------------------------------------------------------- Quarter ended Half year ended September 30, September 30, Year ended --------------------- --------------------- March 31, 2002 2001 2002 2001 2002 -------- ------ -------- ------ ---------- CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax 270.77 234.56 530.12 453.09 943.39 Adjustments to reconcile profit before tax to cash provided by operating activities (Profit)/Loss on sale of fixed assets 0.14 0.01 0.13 (0.02) (0.09) Depreciation and amortization 46.24 39.01 86.72 74.49 160.65 Interest income (18.69) (11.79) (36.37) (23.60) (51.23) Effect of deferred taxes (8.74) (2.05) (9.36) (3.11) (8.69) Provision on long term investments 23.76 -- 23.76 -- -- Income taxes paid during the period/year 1 (70.20) (40.94) (95.54) (78.84) (131.27) Exchange differences on translation of foreign currency deposits 1.06 (2.56) 0.97 (3.82) (13.26) Changes in current assets and liabilities Sundry debtors (44.96) (34.48) (121.52) (41.23) (34.36) Loans and advances 2 (22.05) (9.15) (73.64) (18.10) (39.02) Current liabilities and provisions 3 46.38 26.18 111.45 45.88 (5.16) -------- ------- -------- ------- -------- NET CASH GENERATED BY OPERATING ACTIVITIES 223.71 198.79 416.72 404.74 820.96 -------- ------- -------- ------- -------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds on exercise of stock options 2.75 -- 3.15 0.41 4.60 Dividends paid during the period/year, including Dividend Tax -- -- (82.73) (54.68) (109.37) -------- ------- -------- ------- -------- NET CASH GENERATED / (USED) BY FINANCING ACTIVITIES 2.75 -- (79.58) (54.27) (104.77) -------- ------- -------- ------- -------- CASH FLOWS FROM INVESTING ACTIVITIES Purchases of fixed assets and change in capital work-in-progress 4 (44.02) (129.75) (97.80) (231.49) (322.74) Proceeds on disposal of fixed assets 0.04 0.95 0.16 1.03 1.60 Long-term investments in securities 5 -- -- (12.52) (10.32) (10.32) Interest income 18.69 11.79 36.37 23.60 51.23 -------- ------- -------- ------- -------- NET CASH USED IN INVESTING ACTIVITIES (25.29) (117.01) (73.79) (217.18) (280.23) -------- ------- -------- ------- -------- Effect of exchange differences on translation of foreign currency deposits (1.06) 2.56 (0.97) 3.82 13.26 -------- ------- -------- ------- -------- Net (decrease)/increase in cash and cash equivalents during the period/year 200.11 84.34 262.38 137.11 449.22 CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD/YEAR 1,089.23 630.51 1,026.96 577.74 577.74 -------- ------- -------- ------- -------- CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD/YEAR 6 1,289.34 714.85 1,289.34 714.85 1,026.96 = ======== ======= ======== ======= ======== NOTES ON THE STATEMENT OF CASH FLOWS 7
This is the Cash Flow Statement referred to in our report of even date. For Bharat S Raut & Co. Chartered Accountants S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director President and Managing Deputy Managing Director Director Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler Director Director Director Director Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal Director Director Director Director T. V. Mohandas Pai Srinath Batni V. Balakrishnan Bangalore Director and Chief Director Company Secretary and October 10, 2002 Financial Officer Vice President - Finance
14 Schedules to the statement of cash flows
in Rs. crore -------------------------------------------------------- Quarter ended Half year ended September 30, September 30, Year ended ------------------- ------------------- March 31, 2002 2001 2002 2001 2002 ------- ------- ------- ------- ------- 1 Income taxes paid during the period/year Charge as per the Profit and Loss Account 45.00 33.00 87.50 61.50 135.43 Add: Increase in advance income taxes 78.94 42.99 104.90 80.40 112.51 Less: Increase/(Decrease) in income tax provision (53.74) (35.05) (96.86) (63.06) (116.67) -------- ------- -------- ------- -------- 70.20 40.94 95.54 78.84 131.27 ======== ======= ======== ======= ======== 2 Change in loans and advances during the period/year As per the Balance Sheet 870.16 623.26 870.16 623.26 643.87 Less: Deposits with financial institutions and body corporate, included in cash and cash equivalents (302.49) (287.16) (302.49) (287.16) (254.74) Advance income taxes separately considered (341.15) (204.14) (341.15) (204.14) (236.25) -------- ------- -------- ------- -------- 226.52 131.96 226.52 131.96 152.88 Less: Opening balance considered (204.47) (122.81) (152.88) (113.86) (113.86) -------- ------- -------- ------- -------- 22.05 9.15 73.64 18.10 39.02 ======== ======= ======== ======= ======== 3 Change in current liabilities and provisions during the period/year As per the Balance Sheet 692.25 428.80 692.25 428.80 459.41 Add/(Less):Provisions separately considered in the cash flow statement Income taxes (336.43) (185.97) (336.43) (185.97) (239.57) Dividends (82.76) (49.62) (82.76) (49.62) (82.73) Dividend tax -- (5.06) -- (5.06) -- -------- ------- -------- ------- -------- 273.06 188.15 273.06 188.15 137.11 Less: Non-cash transactions -- -- (24.50) -- -- Less: Opening balance considered (226.68) (161.97) (137.11) (142.27) (142.27) -------- ------- -------- ------- -------- 46.38 26.18 111.45 45.88 (5.16) ======== ======= ======== ======= ======== 4 Purchases of fixed assets and change in capital work-in-progress As per the Balance Sheet 40.64 57.57 180.62 165.95 342.72 Less: Opening capital work-in-progress (88.97) (164.01) (150.67) (170.65) (170.65) Less: Non-cash transactions -- -- (24.50) -- -- Add: Closing capital work-in-progress 92.35 236.19 92.35 236.19 150.67 -------- ------- -------- ------- -------- 44.02 129.75 97.80 231.49 322.74 ======== ======= ======== ======= ======== 5 Long-term investments in securities during the period/year As per the Balance Sheet 33.20 44.44 33.20 44.44 44.44 Add: Provisions on investments 23.76 -- 23.76 -- -- -------- ------- -------- ------- -------- 56.96 44.44 56.96 44.44 44.44 Less: Opening balance considered (56.96) (44.44) (44.44) (34.12) (34.12) -------- ------- -------- ------- -------- -- -- 12.52 10.32 10.32 ======== ======= ======== ======= ======== 6 Cash and cash equivalents at the end of the period/year As per the Balance Sheet 986.85 427.69 986.85 427.69 772.22 Add: Deposits with financial institutions and body corporate, included herein 302.49 287.16 302.49 287.16 254.74 -------- ------- -------- ------- -------- 1,289.34 714.85 1,289.34 714.85 1,026.96 ======== ======= ======== ======= ========
7. Notes on the statement of cash flows 7.1 Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, financing, and investing activities of the company are segregated. Cash flows in foreign currencies are accounted at average monthly exchange rates that approximate the actual rates of exchange prevailing at the dates of the transactions. 7.2 The balance of cash and cash equivalents includes Rs. 1.53 as at September 30, 2002 (as at September 30, 2001, Rs. 0.76 and March 31, 2002, Rs. 0.48) set aside for payment of dividends, also an amount of Rs. 4.88 (nil as at September 30, 2001 and March 31, 2002) has been retained in escrow for payment to IQ Financial Systems, USA towards purchase of IPR and the same is payable on the successful renewal of certain customer contracts in favor of the company. Accordingly, such cash is not available to the company. 7.3 During the quarter, the company entered into an agreement with the Aeronautical Development Agency, India for acquiring the intellectual property rights in AUTOLAY, a commercial software application product used in the design of high performance structural systems. The agreement requires the company to pay a consideration of $5 million (approximately Rs. 24.50) by 10 years of the contract date. The intellectual property has been recorded in the books of account along with the corresponding liability, which in substance is a non-cash transaction and hence has been excluded in the statement of cash flows. 7.4 Long-term investments in securities includes Rs. 12.25 invested in Progeon Ltd., a subsidiary, in the quarter ended September 30, 2002. 7.5 The previous year's/period's figures have been recast/restated, wherever necessary, to conform to the current period's presentation. 15 Consolidated financial statements of Infosys Technologies Limited and its subsidiary Principles of consolidation The financial statements are prepared in accordance with the principles and procedures for the preparation and presentation of consolidated financial statements as laid down under the accounting standard on Consolidated Financial Statements issued by the ICAI. This being the first year of presentation of consolidated financial statements in line with the accounting standards, prior period figures have not been provided as they are unconsolidated and therefore do not permit meaningful comparison. The financial statements of the parent company, Infosys and Progeon have been combined on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances and transactions and resulting unrealized gains/losses. The consolidated financial statements are prepared applying uniform accounting polices in use at Infosys and Progeon. Management's Statement on significant accounting policies contained in the audited financial statements There are no changes in the accounting policies during the quarter ended September 30, 2002. The significant accounting policies of the company relate to revenue recognition, expenditure, fixed assets and capital work-in -progress, depreciation, retirement benefits to employees - principally gratuity, superannuation and provident fund benefits, research and development, income tax, earning per share, foreign currency transactions and investments. A complete set of the audited consolidated financial statements is available at www.infosys.com Auditor's report We have examined the attached Consolidated Balance Sheet of Infosys Technologies Limited (the Company) and its subsidiary Progeon Limited (subsidiary) as at September 30, 2002, the Consolidated Profit and Loss Accounts and the Consolidated Cash Flow Statements for the quarter and half-year ended on that date, annexed thereto. These financial statements are the responsibility of the Infosys Technologies Limited's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are prepared, in all material respects, in accordance with the financial reporting framework generally accepted in India and are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements. We believe that our audit provides a reasonable basis for our opinion. We report that the consolidated financial statements have been prepared by the Company in accordance with the requirements of Accounting Standard (AS) 21, Consolidated Financial Statements, issued by the Institute of Chartered Accountants of India and on the basis of separate audited financial statements of Infosys Technologies Limited and its subsidiary included in the consolidated financial statements. On the basis of the information and explanation given to us, and on consideration of separate audit reports on individual audited financial statements of Infosys Technologies Limited and its subsidiary, we are of the opinion that: (i) the Consolidated Balance Sheet gives a true and fair view of the consolidated state of affairs of the Infosys Technologies Limited and its subsidiary as at September 30, 2002; (ii) the Consolidated Profit and Loss Accounts gives a true and fair view of the consolidated results of operations of Infosys Technologies Limited and its subsidiary for the quarter and half year ended on that date; and (iii) the Consolidated Cash Flow Statements gives a true and fair view of the consolidated cash flows of Infosys Technologies Limited and its subsidiary for the quarter and half year ended on that date. for Bharat S Raut & Co. Chartered Accountants Bangalore S Balasubrahmanyam October 10, 2002 Partner 16 Consolidated balance sheet as at
in Rs. crore ------------------ September 30, 2002 ------------------ SOURCES OF FUNDS SHAREHOLDERS' FUNDS Share capital 33.10 Reserves and surplus 2,407.73 Preference shares issued by subsidiary 49.00 -------- 2,489.83 ======== APPLICATION OF FUNDS FIXED ASSETS Original cost 1,140.87 Less: Depreciation and amortization 476.70 -------- Net book value 664.17 Add: Capital work-in-progress 92.59 -------- 756.76 INVESTMENTS 20.95 DEFERRED TAX ASSETS 33.58 CURRENT ASSETS, LOANS AND ADVANCES Sundry debtors 459.73 Cash and bank balances 1,004.11 Loans and advances 912.20 -------- 2,376.04 Less: Current liabilities 267.61 Provisions 429.89 -------- NET CURRENT ASSETS 1,678.54 -------- 2,489.83 ========
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS The schedules referred to above and the notes thereon form an integral part of the consolidated balance sheet. This is the consolidated balance sheet referred to in our report of even date. for Bharat S Raut & Co. Chartered Accountants S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director President and Managing Deputy Managing Director Director Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler Director Director Director Director Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal Director Director Director Director T. V. Mohandas Pai Srinath Batni V. Balakrishnan Bangalore Director and Chief Director Company Secretary and October 10, 2002 Financial Officer Vice President - Finance
17 Consolidated profit and loss account for the
in Rs. crore, except per share data ----------------------------------- Quarter ended Half year ended ------------- --------------- September 30, 2002 ------------------------------- INCOME - Software services, products and business process management Overseas 858.24 1,608.86 Domestic 22.34 36.44 ----------- ----------- 880.58 1,645.30 Software development and business process management expenses 425.50 803.24 ----------- ----------- GROSS PROFIT 455.08 842.06 SELLING AND MARKETING EXPENSES 70.26 125.53 GENERAL AND ADMINISTRATION EXPENSES 63.38 121.27 ----------- ----------- 133.64 246.80 OPERATING PROFIT (PBIDTA) 321.44 595.26 Interest -- -- Depreciation and amortization 46.39 86.88 ----------- ----------- OPERATING PROFIT AFTER INTEREST, DEPRECIATION AND AMORTIZATION 275.05 508.38 Other income 18.21 43.01 Provision for investments 23.76 23.76 ----------- ----------- NET PROFIT BEFORE TAX 269.50 527.63 Provision for taxation 45.00 87.50 ----------- ----------- NET PROFIT AFTER TAX 224.50 440.13 ----------- ----------- AMOUNT AVAILABLE FOR APPROPRIATION 224.50 440.13 ----------- ----------- DIVIDEND Interim 82.76 82.76 ----------- ----------- Balance in Profit and Loss Account 141.74 357.37 =========== =========== EARNINGS PER SHARE (Equity shares, par value Rs. 5/- each) Basic 33.91 66.49 Diluted 33.71 66.03 Number of shares used in computing earnings per share Basic 6,61,98,735 6,61,93,632 Diluted 6,65,96,469 6,66,51,932 =========== ===========
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS The schedules referred to above and the notes thereon form an integral part of the consolidated profit and loss account. This is the consolidated profit and loss account referred to in our report of even date. for Bharat S Raut & Co. Chartered Accountants S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director President and Managing Deputy Managing Director Director Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler Director Director Director Director Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal Director Director Director Director T. V. Mohandas Pai Srinath Batni V. Balakrishnan Bangalore Director and Chief Director Company Secretary and October 10, 2002 Financial Officer Vice President - Finance
18 Consolidated cash flow statement for the
in Rs. crore -------------------------------- Quarter ended Half year ended ------------- --------------- September 30, 2002 -------------------------------- CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax 269.50 527.63 Adjustments to reconcile profit before tax to cash provided by operating activities (Profit)/Loss on sale of fixed assets (0.14) (0.13) Depreciation and amortization 46.39 86.88 Interest income (19.79) (37.50) Effect of deferred taxes (8.74) (9.36) Provision for investments 23.76 23.76 Income taxes paid during the period (70.35) (95.69) Exchange differences on translation of foreign currency deposits 1.06 0.97 Changes in current assets and liabilities Sundry debtors (45.84) (123.01) Loans and advances (23.96) (75.10) Current liabilities and provisions 50.80 116.70 -------- -------- NET CASH GENERATED BY OPERATING ACTIVITIES 222.69 415.15 -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the issue of preference share capital -- 49.00 Proceeds on exercise of stock options 2.74 3.14 Dividends paid during the period/year, including dividend tax -- (82.73) -------- -------- NET CASH GENERATED/(USED) BY FINANCING ACTIVITIES 2.74 (30.59) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES Purchases of fixed assets and change in capital work-in-progress (46.99) (101.19) Proceeds on disposal of fixed assets 0.32 0.44 Long-term investments in securities -- (0.27) Interest income 19.79 37.50 -------- -------- NET CASH USED IN INVESTING ACTIVITIES (26.88) (63.52) -------- -------- Effect of exchange differences on translation of foreign currency deposits (1.06) (0.97) -------- -------- Net (decrease)/increase in cash and cash equivalents during the period 197.49 320.07 CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 1,149.54 1,026.96 -------- -------- CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 1,347.03 1,347.03 ======== ======== NOTES ON THE STATEMENT OF CASH FLOWS -------- --------
This is the Cash Flow Statement referred to in our report of even date. for Bharat S Raut & Co. Chartered Accountants S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director President and Managing Deputy Managing Director Director Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler Director Director Director Director Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal Director Director Director Director T. V. Mohandas Pai Srinath Batni V. Balakrishnan Bangalore Director and Chief Director Company Secretary and October 10, 2002 Financial Officer Vice President - Finance
19 Ratio analysis as per Indian GAAP (Non-consolidated)
Quarter ended Half Year ended September 30, September 30, Year ended ------------------ ------------------ March 31, 2002 2001 2002 2001 2002 ------ ------ ------ ------ --------- Financial performance Export revenue/total revenue(%) 97.46 98.18 97.78 97.78 98.04 Domestic revenue/total revenue(%) 2.54 1.82 2.22 2.22 1.96 Software development expenses/total revenue(%) 48.26 47.21 48.77 46.93 47.04 Gross profit/total revenue(%) 51.74 52.79 51.23 53.07 52.96 Selling and marketing expenses/total revenue(%) 7.88 5.15 7.57 4.84 4.99 General and administration expenses/total revenue(%) 7.11 7.81 7.28 8.68 8.12 Selling, general and administration expenses/total revenue(%) 14.99 12.96 14.85 13.52 13.11 Employee costs/total revenue(%) 45.46 42.76 45.55 42.62 42.94 Operating profit/total revenue(%) 36.75 39.83 36.38 39.55 39.85 Depreciation and amortization/total revenue(%) 5.26 6.00 5.27 5.90 6.17 Operating profit after depreciation and interest/total revenue(%) 31.49 33.82 31.11 33.65 33.68 Other income/total revenue(%) 1.99 2.25 2.58 2.23 2.55 Provision for investments/total revenue(%) 2.70 -- 1.45 -- -- Profit before tax/total revenue(%) 30.78 36.08 32.24 35.88 36.23 Tax/total revenue(%) 5.12 5.08 5.32 4.87 5.20 Tax/PBT(%) 16.62 14.07 16.51 13.57 14.36 PAT from ordinary activities/total revenue(%) 25.67 31.00 26.92 31.01 31.03 PAT from ordinary activities/average net worth(%)(LTM) 41.04 52.15 41.04 52.15 46.57 ROCE (PBIT/Average capital employed)(%)(LTM) 48.76 59.39 48.76 59.39 54.37 Return on invested capital(%)(LTM) 75.04 89.64 75.04 89.64 83.10 Capital output ratio(LTM) 1.43 1.67 1.43 1.67 1.50 Invested capital output ratio(LTM) 2.74 2.98 2.74 2.98 2.79 Balance sheet Debt-equity ratio -- -- -- -- -- Debtors turnover (Days)(LTM) 56 53 56 53 47 Current ratio 3.34 3.25 3.34 3.25 3.82 Cash and cash equivalents/total assets(%) 52.77 41.02 52.77 41.02 49.37 Cash and cash equivalents/total revenue(%)(LTM) 43.19 30.27 43.19 30.27 39.44 Capital expenditure/total revenue(%)(LTM) 6.33 20.96 6.33 20.96 12.40 Depreciation/average gross block(%)(LTM) 17.95 23.76 17.95 23.76 20.18 Technology investment/total revenue(%)(LTM) 3.14 6.51 3.14 6.51 3.93 Year on Year growth(%)(**) Export revenue 34 45 30 56 36 Total revenue 35 46 30 58 37 Operating profit 25 47 20 59 36 Net profit 12 31 13 42 30 Basic EPS 12 31 13 42 30 Per - share data (period end) Basic earnings per share from ordinary activities (Rs.) 34.10 30.47 66.87 59.19 122.12 Basic cash earnings per share from ordinary activities (Rs.) 41.09 36.36 79.96 70.45 146.40 Book value (Rs.) 369.05 263.37 369.05 263.37 314.31 Price/earning(LTM) 26.25 21.47 26.25 21.47 30.50 Price/cash earnings(LTM) 21.86 17.94 21.86 17.94 25.44 Price/book value 9.23 9.11 9.23 9.11 11.85 PE/EPS growth 2.20 0.70 2.03 0.51 1.03 Dividend per share (Rs.) NA NA 12.50 7.50 20.00 ------ ------ ------ ------ ------
(**) Denotes growth compared with figures of the corresponding period in the previous year. LTM: Last Twelve Months 20 At a glance - US GAAP
US $ millions, except as otherwise stated ---------------------------------------------------------------- Quarter ended Half year ended September 30, September 30, Year ended ------------------ ---------------------- March 31, 2002 2001 2002 2001 2002 ------ ------ -------- -------- -------- For the period Revenues 181.45 137.26 337.76 267.79 545.05 Operating income 55.44 45.16 101.87 87.60 178.55 Operating income/revenues(%) 30.55% 32.90% 30.16% 32.71% 32.76% Net income 46.70 41.29 89.54 80.53 164.47 Net income/revenues(%) 25.74% 30.08% 26.51% 30.07% 30.17% Basic earnings per equity share($) 0.71 0.63 1.36 1.23 2.51 Cash dividend per equity share($) NA NA 0.26 0.16 0.35 Capital expenditure 9.48 26.95 20.08 47.51 68.35 At the end of the period Total assets 591.52 413.40 471.16 Property, plant and equipment-net 149.20 149.14 147.21 Cash and cash equivalents 278.31 149.39 210.49 Working capital 355.04 201.41 270.37 Total debt -- -- -- Stockholders' equity 524.02 374.07 442.38 Common stock 8.60 8.59 8.60 Market capitalization 4,659.60 3,288.47 5,053.15 ------ ------ -------- -------- --------
Note: Market capitalization is calculated by considering the Indian market price for the shares outstanding at the period/year end. Revenues [PERFORMANCE GRAPH] Year ended March 31, 2002 545.05 Quarter ended September 30, 2001 137.26 Quarter ended September 30, 2002 181.45
Operating income [PERFORMANCE GRAPH] Year ended March 31, 2002 178.55 Quarter ended September 30, 2001 45.16 Quarter ended September 30, 2002 55.44
Net income [PERFORMANCE GRAPH] Year ended March 31, 2002 164.47 Quarter ended September 30, 2001 41.29 Quarter ended September 30, 2002 46.70
21 Form 6-K Page 22 - 46 Shareholder information 1. Registered office Electronics City, Hosur Road, Bangalore - 561 229, India Tel.: +91-80-852 0261, Fax: +91-80-852 0362 Homepage: www.infosys.com 2. Listing on stock exchanges In India: National Stock Exchange of India Ltd. (NSE) The Stock Exchange, Mumbai (BSE) Bangalore Stock Exchange Ltd. (BgSE) Outside India: NASDAQ National Market in the United States 3. Par value of equity shares Rs. 5 each fully paid-up 4. Registrar and share transfer agents Karvy Consultants Limited, Share transfers in physical form and other Registrars and Share Transfer Agents; communication regarding share certificates, T.K.N. Complex, No. 51/2, Vanivilas Road; dividends, change of address, etc. may be addressed to: Opposite National College, Basavanagudi; Bangalore 560 004, India. Tel.: +91-80-662-1184, Fax: +91-80-662-1169 E-mail: kannans@karvy.com
5. Stock market data relating to shares listed in India a. The company's market capitalization is included in the computation of the BSE-30 Sensitive Index (Sensex), the BSE Dollex and S&P CNX NIFTY Index. b. Monthly high and low quotations as well as the volume of shares traded at National, Mumbai and Bangalore Stock Exchanges for the quarter ended September 30,2002 are:
NSE BSE BgSE -------------------------------- -------------------------------- ----------------------------- High Low Volume High Low Volume High Low Volume Rs. Rs. Nos. Rs. Rs. Nos. Rs. Rs. Nos. ------ ----- ----------- ------ ------- ----------- ----- ---- ------ Jul 2002 3,480 2,975 1,19,84,211 3,478 2,972 58,92,906 -- -- -- Aug 3,635 2,937 1,27,09,793 3,644 2,935 58,59,212 -- -- -- Sep 3,708 3,330 1,25,70,577 3,710 3,365 52,99,771 -- -- -- ------ ----- ----------- ------ ------- ----------- ----- ---- ------ Total 3,72,64,581 1,70,51,889 ----------- ----------- Volume traded/ shares outstanding (%)(*) September 30, 2002 58.16 26.61 -- September 30, 2001 58.29 35.94 .001 ----- ----- ----
(*) The number of shares outstanding as of September 30,2002 is 6,40,70,030. The equity shares underlying the American Depositary Shares (ADSs) have been excluded for the purpose of this calculation. 6. Share transfer system Shares sent for physical transfer are effected after giving a notice of 15 days to the seller for sale confirmation. The share transfer committee of the company meets as often as required. The total number of shares transferred in physical form during the three-month period ended September 30,2002 was NIL (quarter ended September 30, 2001 - 9,000). 7. Investors' services - complaints received
Quarter ended ------------------------------------------------- September 30, 2002 September 30, 2001 ----------------------- ----------------------- Nature of complaints Received Attended to Received Attended to -------------------- --------- ----------- -------- ----------- Non-receipt of: dividend warrants 41 41 52 52 Dividend in ECS mode 34 34 -- -- Split shares/bonus shares 1 1 -- -- Share certificates -- -- 1 1 ---- ---- ---- ---- Total 76 76 53 53 ---- ---- ---- ----
The company has attended to most of the investors' grievances/correspondence within a period of 10 days from the date of receipt of the same, during the quarter ended September 30, 2002 except in cases that are constrained by disputes or legal impediments. 8. Legal proceedings There are some pending cases relating to disputes over title to shares, in which the company is made a party. However, these cases are not material in nature. 9. Categories of shareholders as on September 30
2002 2001 --------------------------------------------- ------------------------------------------ No. of Voting No. of No. of Voting No. of Category shareholders strength(%) shares held shareholders strength(%) shares held -------- ------------ ----------- ------------ ------------ ----------- ------------- Individuals 82,609 17.43 1,15,42,056 89,117 20.25 1,33,95,950 Companies 3,036 1.09 7,19,104 3,415 1.01 6,67,319 NRIs/OCBs 842 1.06 7,02,906 742 0.67 4,45,388 FIIs 308 37.67 2,49,42,998 361 34.61 2,28,97,389 Mutual Funds, Banks, FIs 196 9.68 64,10,994 187 10.10 66,85,980 Founders and their families 23 28.56 1,89,07,585 23 28.92 1,91,33,460 Trusts 8 1.28 8,44,387 19 1.28 8,44,514 Equity shares underlying American Depositary Shares(*) 1 3.23 21,35,150 1 3.16 20,90,717 ------ ------ ----------- ------ ------ ----------- Total 87,023 100.00 6,62,05,180 93,865 100.00 6,61,60,717 ------ ------ ----------- ------ ------ -----------
(*) Held by beneficial owners outside India 47 10. Financial calendar (tentative and subject to change) Interim dividend payment November 8, 2002 Financial reporting for the third quarter ending December 31, 2002 January 10, 2003 Financial results for the year ending March 31, 2003 April 10, 2003 Annual General Meeting for the year ending March 31, 2003 May / June 2003
11. Investors' correspondence in India For investor matters For queries relating to financial statements V. Balakrishnan T. V. Mohandas Pai Company Secretary & Vice President - Finance Director and Chief Financial Officer Investors' Service Cell Infosys Technologies Ltd., Infosys Technologies Ltd., Electronics City Electronics City Hosur Road, Bangalore 561 229, India Hosur Road, Bangalore 561 229, India Tel.: +91-80-852-0396, Fax: +91-80-852-0754 Tel.: +91-80-852-0440, Fax: +91-80-852-0754 E-mail: mdpai@infosys.com E-mail: balakv@infosys.com
12. Stock Exchange Codes
Reuters code Bridge code Bloomberg code --------------- ---------------- -------------- INFY.BO (BSE) IN;INF (BSE) INFO IN (BSE) INFY.NS (NSE) IN;INFN (NSE) NINFO IN (NSE) INFY.O (NASDAQ) US;INFY (NASDAQ)
13. Stock market data relating to American Depositary Shares (ADSs) a. ADS(*) listed at NASDAQ National Market in the United States b. Ratio of ADS to equity shares 2 ADS for one equity share c. ADS symbol INFY d. The American Depositary Shares issued under the ADS program of the company were listed on the NASDAQ National Market in the United States on March 11, 1999. The monthly high and low quotations as well as the volume of ADSs traded at the NASDAQ National Market for the quarter ended September 30, 2002 are:
High Low --------------------- -------------------- Volume $ Rs. $ Rs. Nos. ----- ----- ----- ----- --------- Jul 2002 57.00 2,775 48.00 2,337 16,86,500 Aug 57.75 2,802 49.50 2,402 17,03,000 Sep 60.68 2,937 53.05 2,568 14,87,300 --------- Total 48,76,800 ---------
(*) 2 ADS = 1 equity share. US $ has been converted into Indian rupees at the monthly closing rates. The number of ADSs outstanding as on September 30, 2002 was 42,70,300. The percentage of volume traded to the total float was 114.20%. e. Investor correspondence in P. R. Ganapathy the US may be addressed to Investor Relations Officer Infosys Technologies Limited 34760, Campus Drive, Fremont CA 94555, USA. Tel.: +1-510-742-3030, Mobile: +1-510-872-4412, Fax: +1-510-742-2930, E-mail: guns@infosys.com
14. ECS mandate The company has received complaints regarding non-receipt of dividend warrants. All shareholders are requested to update their bank account details with their respective depositories urgently. This would enable the company to service its investors better. A copy of the ECS mandate form is provided elsewhere in the report. The ECS mandate form duly filled-up should be sent to the depository participant with whom the shareholder maintains his/her demat account. 15. Change of address The company has received complaints regarding non-receipt of dividend warrants and other corporate communications. All shareholders are requested to update their current address with their respective depositories immediately. This would enable the company to service its investors better. 48 ELECTRONIC CLEARING SERVICE (CREDIT CLEARING) MANDATE FORM Shareholder's authorization to receive dividends through Electronic Credit Clearing Mechanism 1. Name of the first/sole shareholder 2. Folio No. 3. Particulars of bank account of first/sole shareholder a. Name of the Bank b. Branch Address of the branch Telephone no. of the branch c. 9-digit code number of the Bank and Branch appearing on the MICR cheque issued by the bank d. Account number (as appearing on the cheque book/passbook) e. Account type (S.B. account/current account or cash credit) with code 10/11/13 f. Ledger no. / Ledger folio no. (if appearing on the cheque book/passbook) (In lieu of the bank certificate to be obtained as under, please attach a blank cancelled cheque, or photocopy of a cheque or the front page of the savings bank passbook issued to you by your bank, for verification of the above particulars.) I hereby declare that the particulars given above are correct and complete. If the transaction is delayed or not effected at all for reasons of incomplete or incorrect information, I will not hold Infosys Technologies Limited responsible. I have read the option invitation letter and agree to discharge the responsibility expected of me as a participant under the scheme. Date : Place : Signature of the shareholder -------------------------------------------------------------------------------- Certified that the particulars furnished above are correct as per our records. Bank's Stamp Signature of the Authorized Official Date : from the Bank Note: 1. Please fill in the attached Mandate Form and send it to: (i) the Depository Participant who is maintaining your demat account in case your shares are dematerialized. (ii) the address of our Registrars and Share Transfer Agents, M/s. Karvy Consultants Limited, No. 51/2, T.K.N. Complex, Vanivilas Road, Opp. National College, Basavanagudi, Bangalore - 560 004 in case you are holding physical share certificates. 2. Kindly note that the information provided by you should be accurate and complete in all respects and duly certified by your bank. In lieu of the bank certificate, you may attach a blank cancelled cheque or photocopy of a cheque or the front page of the Savings Bank passbook issued to you by your bank, for verification of the above particulars. 3. In case of more than one folio please complete the details on separate sheets. 4. The information provided by you will be treated confidential and would be utilised only for the purpose of effecting the payments meant for you. You also have the right to withdraw from this mode of payment by providing the Company with an advance notice of 6 weeks. This page is intentionally left blank Infosys Technologies Limited United States UK Netherlands Chennai Mysore Addison 11th Floor, Emerald House Newtonlaan 115, No. 138 No. 350 15305 Dallas Parkway 7/15 Lansdowne Road 3584 BH Utrecht Old Mahabalipuram Road Hebbal Electronics City Suite 210 Croydon, CR0 2BX, Surrey The Netherlands Sholinganallur Hootagalli, Addison, TX 75001 Tel: (44) 20 8774 3300 Tel: (31) 0 302106462 Chennai-600 119 Mysore-571 186 Tel: (972) 770 0450 Fax: (44) 20 8686 6631 Fax: (31) 0 302106860 Tel: (91) 44 4509530/40 Tel: (91) 821 404101 Fax: (972) 770 0490 Fax: (91) 44 4500390 Fax: (91) 821 404200 Castle House Scandinavia Bellevue 37-45 Paul Street, Stureplan 4C, 4tr Hyderabad New Delhi 10900 NE 4th Street #2300 London 114 35, Stockholm, Sweden Survey No. 210 K30, Green Park Main Bellevue, WA 98004 EC 2ALLS Tel: (46) 8 463 1112 Manikonda Village Behind Green Park Market Tel: (425) 990 1028 Tel: 020 7549 6900 Fax: (46) 8 463 1114 Lingampally New Delhi-110 066 Fax: (425) 990 1029 Fax: 02072518320 Rangareddy (Dist) Tel: (91) 11 6514829-30 Singapore Hyderabad-500 019 Fax: (91) 11 6853366 Berkeley Heights Australia 30, Raffles Place Tel: (91) 40 3005222 Two Connell Drive Level 7, 505 St. Kilda Road #23-00 Caltex House Fax: (91) 40 3005223 Pune Suite 4100 Melbourne, Victoria 3004 Singapore 048622 Plot No. 1; Berkeley Heights Tel: (61) 3 9868 1607 Tel: (65) 6233 6820 Mangalore Pune Infotech Park NJ 07922 Fax: (61) 3 9868 1652 Fax: (65) 6233 6905 Kuloor Ferry Road At Post Hinjawadi Tel: (908) 286 3100 Kottara Taluka Mulshi Fax: (908) 286 3125 Level 4, 90 Mount Street Switzerland Mangalore-575 006 Pune-411 027 North Sydney NSW 2060 Dreikonigstrasse 31A Tel: (91) 824 451485-88 Tel: (91) 20 2932800/01 Fremont Tel: (61) 2 9954 0036 8002 Zurich Fax: (91) 824 451504 Fax: (91) 20 2932832 34760 Campus Drive Fax: (61) 2 8904 1344 Tel: (41) 1 208 3905 Fremont, CA 94555 Fax: (41) 1 208 3500 Mohali (Chandigarh) Tel: (510) 742 3000 Level 9, B 100, Industrial Area Fax: (510) 742 3090 114, Albert Road United Arab Emirates Phase 8 Mohali South Melbourne Y-45, P. O. Box 8230 (SAS Nagar)-160 059 Lake Forest Sharjah Airport Punjab 25341 Commercentre Drive Belgium International Free Tel: (91) 172 390510 Suite 150 Dreve Richelle 161 Zone (Saif Zone) Sharjah (91) 172 257191, 92 Lake Forest, CA 92630 Building N 1410 Waterloo Tel: (971) 6 5571 068 Fax: (91) 172 254193 Tel: (949) 455 9161 Brussels Fax: (971) 6 5571 056 Fax: (949) 609 0694 Tel: (322) 352 8718 Mumbai Fax: (322) 352 8844 India 85-C Wing, 8th Floor Lisle Bangalore Mittal Towers 2300 Cabot Drive Canada Electronics City Nariman Point Ste 250, Lisle, IL 60532 5140 Yonge Street Hosur Road Mumbai-400 021 Tel: (630) 482 5000 Suite 1400 Bangalore-561 229 Tel: (91) 22 2882911/14 Fax: (630) 505 9144 Toronto, Ontario M2N 6L7 Tel: (91) 80 8520261 Fax: (91) 22 2846489 Tel: (416) 224 7400 Fax: (91) 80 8520362 Marietta Fax: (416) 224 7474 400 Galleria parkway, Reddy Building Suite 1490, Atlanta France K-310, 1st Main GA 30339 12 Avenue de l'Arche 5th Block, Koramangala Tel: 770 980 7955 Faubourg de l'Arche Bangalore-560 095 Fax: 770 980 7956 92419 Courbevoie Cedex Tel: (91) 80 5532591/92 Paris Fax: (91) 80 5530391 Ohio Tel: (33)1 4691 8456 6543-6631, Fax: (33)1 4691 8800 Pavithra Complex Commerce Parkway, #1, 27th Main, 2nd Cross Dublin Ohio,43017 Germany 1st Stage, BTM Layout Tel: (614) 792 9907 TOPAS 1 Bangalore-560 068 Fax: (614) 792 9929 Mergenthalerallee 77 Tel: (91) 80 6680182 - 85 65760 Eschborn/Frankfurt Fax: (91) 80 6680181 Phoenix Tel: (49) 6196 9694 0 10851 N Black Canyon Fax: (49) 6196 9694 200 Infosys Towers Hwy No. 27, Bannerghatta Road #830, Phoenix, AZ 85029 Hong Kong 3rd Phase, J.P. Nagar Tel: (602) 944 4855 16F Cheung Kong Centre Bangalore-560 076 Fax: (602) 944 4879 2 Queen's Road Central Tel: (91) 80 6588668 Central, Hong Kong Fax: (91) 80 6588676 Quincy Tel: (852) 2297 2231 Two Adams Place, Fax: (852) 2297 0066 Bhubaneswar Quincy MA 02169 Plot No. E/4, Info City Tel: (781) 356 3100 Japan Bhubaneswar-751 024 Fax: (781) 356 3150 Kearny Place Akasaka, 2F Orissa, India 2-21-25, Akasaka Tel: (91) 674 320001-32 Troy Minato-Ku Fax: (91) 674 320100 100 Liberty Center Tokyo 107-0052 #200, West Big Beaver Tel: (81) 3 5545 3251 Troy MI 48084 Fax: (81) 3 5545 3252 Tel: (248) 524 0320 Fax: (248) 524 0321
Bankers Visit Infosys at ICICI Bank Ltd. www.infosys.com Bank of America Company Secretary Send e-mail to V. Balakrishnan Infosys@infosys.com Auditors Call us at Bharat S Raut and Co. within the U.S. Chartered Accountants 1-800-ITL INFO Independent Auditors outside the U.S. (US GAAP) 91-80-8520261 KPMG (C)2002 Infosys Technologies Limited, Bangalore, India. Infosys acknowledges the proprietary rights in the trademarks and product names of other companies mentioned in this document.