EX-99.1 3 f91451exv99w1.txt EXHIBIT 99.1 EXHIBIT 99.1 Infosys Technologies Limited - Financial Release US GAAP Press Release June 30, 2003 Infosys Technologies (NASDAQ: INFY) Announces Results for the Quarter Ended June 30, 2003 INFOSYS RECORDS HIGHER VOLUME GROWTH. INCREASES GUIDANCE FOR REVENUE AND EPS FOR FISCAL 2004 Fremont, California - July 10, 2003 Highlights Results for the quarter ended June 30, 2003 - First quarter revenues at $ 233.3 million, up 49.26% from the corresponding quarter last fiscal - Earnings per American Depositary Share (ADS) increased to $ 0.44 from $ 0.33 in the corresponding quarter last fiscal - 22 new clients were added during the quarter - Gross addition of 2,175 employees for the quarter, including 303 lateral hires - net addition of 1,739 employees for the quarter Outlook for the quarter ending September 30, 2003 and the fiscal year ending March 31, 2004 - Consolidated net revenues expected to be between $ 237 million and $ 239 million for the quarter ending September 30, 2003, and between $ 966 million and $ 982 million for the fiscal year ending March 31, 2004 - Consolidated earnings per ADS expected to be $ 0.45 for the quarter ending September 30, 2003, and between $ 1.81 and $ 1.82 for the fiscal year ending March 31, 2004 Infosys Technologies Limited ("Infosys" or "the company") today announced financial results for its first quarter ended June 30, 2003. Revenues for the quarter aggregated $ 233.3 million, up 49.26% from $ 156.3 million for the quarter ended June 30, 2002. Net income was $ 58.3 million ($ 42.8 million for the quarter ended June 30, 2002) and earnings per ADS was $ 0.44 ($ 0.33) "THERE IS AN INCREASED INTEREST IN OFFSHORE OUTSOURCING AS GLOBAL CORPORATIONS REALIZE ITS BENEFITS. BUSINESS OPPORTUNITIES CONTINUE TO GROW. HOWEVER, THE PRICING ENVIRONMENT REMAINS CHALLENGING," said Nandan M. Nilekani, CEO, President and Managing Director. "OUR VALUE PROPOSITION TO CLIENTS REMAINS STRONGLY DIFFERENTIATED, DESPITE THE INCREASING PRESENCE OF GLOBAL COMPETITORS." "IN SPITE OF THE CHALLENGING ENVIRONMENT, INFOSYS CONTINUED TO INVEST IN SALES, MARKETING AND NEW SERVICES, WHILE IMPROVING EXISTING SERVICES. NEW SERVICES INTRODUCED OVER THE LAST THREE YEARS CONTRIBUTED SIGNIFICANTLY TO CURRENT REVENUES," said S. Gopalakrishnan, Member of the Board and COO. "SALARIES WERE INCREASED FOR OUR EMPLOYEES IN INDIA. INCREASED INVESTMENTS HAVE BEEN BALANCED WITH EFFECTIVE CONTROL OF DISCRETIONARY EXPENDITURE." "THE STRONG GROWTH IN VOLUME HAS EXCEEDED OUR INITIAL EXPECTATIONS," said S. D. Shibulal, Member of the Board and Head - World-wide Customer Delivery. "OUR UTILIZATION HAS FURTHER IMPROVED DURING THE QUARTER. THERE HAS BEEN A CHANGE IN THE ONSITE-OFFSHORE MIX DUE TO A HIGHER COMPONENT OF OFFSHORE WORK." "OUR CONTINUED INVESTMENT IN CLIENT-FACING ACTIVITIES HAS ENABLED US TO ADDRESS CLIENT REQUIREMENTS MORE EFFECTIVELY AND TO DEEPEN RELATIONSHIPS. THIS HAS HELPED US MANAGE A HIGHER SHARE OF OUR CLIENTS' WALLET," said Basab Pradhan, Head - World-wide Sales and Senior Vice President. Infosys strengthened its presence in the financial services industry by partnering with clients to develop technology-enabled business solutions. A GLOBAL BANKING ENTERPRISE selected Infosys to implement a sourcing strategy for reducing cost, improving the efficiency of internal operations, and enabling a quicker response to business needs, for its North American operations. A LARGE, DIVERSIFIED BANK BASED IN THE Page 1 of 4 Infosys Technologies Limited - Financial Release US GAAP Press Release June 30, 2003 UK entered into a long-term strategic relationship with the company for its Information Technology (IT) requirements. Infosys is also designing and building a research portal for A PROVIDER OF SECURITIES AND INVESTMENT BANKING FUNCTIONS. The company strengthened its presence in the automotive and aerospace sector by commencing work for ONE OF THE FORTUNE 500 AUTOMOTIVE COMPANIES in the U.S. Infosys will develop a consolidated requirements management and planning system for the client. In Europe, Infosys is assisting A LEADING AUTOMOTIVE SYSTEM SUPPLIER in the advanced simulation of various crash conditions. "INCREASED EFFICIENCY AND OPTIMIZATION OF EXPENSES HAVE HELPED US MAINTAIN OUR MARGINS DESPITE THE INCREASE IN SALARY COST," said T. V. Mohandas Pai, Member of the Board and Chief Financial Officer. "WE HAVE PRO-ACTIVELY HEDGED OUR NET RECEIVABLES TO MITIGATE THE IMPACT OF RUPEE APPRECIATION ON OUR MARGINS." ABOUT THE COMPANY Infosys is a leading global technology services firm founded in 1981. Infosys provides end-to-end business solutions that leverage technology for our clients across the entire software life cycle: consulting, design, development, re-engineering, maintenance, system integration, package evaluation and implementation. In addition, Infosys offers software products to the banking industry, as well as client business process management services through its majority-owned subsidiary, Progeon. For more information, contact V. Balakrishnan at +91 (80) 852 0440 in India or visit us on the World Wide Web at www.infosys.com. SAFE HARBOR Certain statements in this release concerning our future growth prospects are forward-looking statements, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT services including those factors which may affect 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, industry segment concentration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which Infosys has made strategic investments, withdrawal of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our Annual Report on Form 20-F for the fiscal year ended March 31, 2003. These filings are available at www.sec.gov. Infosys 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. The company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the company. CONTACT Investor Relations P. R. Ganapathy, U.S. V. Balakrishnan, India +1 (510) 742-3030 +91 (80) 852-0440 guns@infosys.com balakv@infosys.com Media Lisa Kennedy, U.S. Tina George, India Relations +1 (510) 742-2946 +91 (80) 852-0261 x 7790 lisa_kennedy@infosys.com tina_george@infosys.com
Page 2 of 4 Infosys Technologies Limited - Financial Release US GAAP Press Release June 30, 2003 CONSOLIDATED STATEMENTS OF INCOME
in US$ except ADS data ---------------------------------- THREE MONTHS ENDED JUNE 30, ---------------------------------- 2003 2002 ---------------------------------- REVENUES 233,255,636 156,314,869 Cost of revenues (including amortization of stock compensation expenses of $ 729,993, and $ 628,907 for the three months ended June 30, 2002 and 2003 respectively) 132,902,389 86,004,769 ---------------------------------- GROSS PROFIT 100,353,247 70,310,100 ---------------------------------- Operating Expenses: Selling and marketing expenses 17,402,555 11,297,734 General and administrative expenses 17,724,228 11,859,128 Amortization of stock compensation expense 442,783 513,954 Amortization of intangible assets 749,118 204,121 ---------------------------------- Total operating expenses 36,318,684 23,874,937 ---------------------------------- OPERATING INCOME 64,034,563 46,435,163 Other income, net 5,300,780 5,096,520 ---------------------------------- INCOME BEFORE INCOME TAXES 69,335,343 51,531,683 Provision for income taxes 11,064,797 8,687,383 ---------------------------------- NET INCOME 58,270,546 42,844,300 ================================== EARNINGS PER ADS Basic $ 0.44 $ 0.33 Diluted $ 0.44 $ 0.32 WEIGHTED EQUITY SHARES USED IN COMPUTING EARNINGS PER ADS Basic 65,583,707 65,566,930 Diluted 66,076,979 66,374,341 ----------------------------------
Page 3 of 4 Infosys Technologies Limited - Financial Release US GAAP Press Release June 30, 2003 CONSOLIDATED BALANCE SHEETS AS OF
in US$ --------------------------------------- JUNE 30, 2003 JUNE 30, 2002 --------------------------------------- ASSETS CURRENT ASSETS Cash and cash equivalents 381,122,431 235,466,369 Investments in liquid mutual fund units 21,548,714 - Trade accounts receivable, net of allowances 121,875,899 84,735,380 Deferred tax assets 514,545 541,814 Prepaid expenses and other current assets 25,181,135 28,175,421 Unbilled revenue 21,338,663 - --------------------------------------- TOTAL CURRENT ASSETS 571,581,387 348,918,984 Property, plant and equipment, net 165,168,590 147,216,819 Intangible assets, net 5,873,532 7,705,557 Deferred tax assets 7,566,810 4,932,021 Investments 3,262,407 7,831,771 Advance income taxes 123,229 - Other assets 17,506,322 13,613,762 --------------------------------------- TOTAL ASSETS 771,082,277 530,218,914 ======================================= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable 144,954 56,260 Client deposits 2,902,094 1,595,670 Other accrued liabilities 53,887,919 30,662,705 Income taxes payable 4,592,757 4,153,534 Unearned revenue 15,912,616 9,244,091 --------------------------------------- TOTAL CURRENT LIABILITIES 77,440,340 45,712,260 Non-current liabilities 5,280,172 5,033,140 Preferred stock of subsidiary 0.0005% Cumulative Convertible Preference Shares, par value $ 2 each, 4,375,000 preference shares authorized, issued and outstanding - 4,375,000 preference shares as of June 30, 2003 10,000,000 10,000,000 STOCKHOLDERS' EQUITY Common stock, $ 0.16 par value; 100,000,000 equity shares authorized, issued and outstanding - 66,188,530 and 66,249,366 as of June 30, 2002 and 2003, respectively 8,603,587 8,597,246 Additional paid-in capital 127,398,522 123,202,029 Accumulated other comprehensive income (15,433,919) (45,600,685) Deferred stock compensation (1,745,376) (6,376,652) Retained earnings 559,538,951 389,651,576 --------------------------------------- Total stockholders' equity 678,361,765 469,473,514 --------------------------------------- --------------------------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 771,082,277 530,218,914 ---------------------------------------
A detailed analysis of the performance of the company can be downloaded in the form of an MS Excel worksheet from www.infosys.com. Page 4 of 4