EX-99.1 2 d810904dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

FOR IMMEDIATE RELEASE

Results for the quarter ended September 30, 2014 under IFRS

IT Services Revenue grew 3.0% sequentially in constant currency

Net Income for the quarter grew 8% YoY

Bangalore, India and East Brunswick, New Jersey, USA – October 22, 2014 — Wipro Limited (NYSE:WIT) today announced financial results under International Financial Reporting Standards (IFRS) for its second quarter ended September 30, 2014.

Highlights of the Results for the Quarter ended September 30, 2014:

 

    Total Revenues were LOGO 116.8 billion ($1.9 billion1), an increase of 8% YoY.

 

    Net Income2 was LOGO 20.8 billion ($337 million1), an increase of 8% YoY.

 

    IT Services Revenue was $1,771.5 million, a sequential increase of 1.8% and YoY increase of 8.6%.

 

    Non-GAAP constant currency IT Services Revenue in dollar terms grew 3% to $1,793.1 million, within our guidance range of $1,770 million to $1,810 million.

 

    IT Services Margins was 22.0%. IT Services Margins includes profit on sale of a strategic investment during the quarter.

Performance for the quarter ended September 30, 2014

Azim Premji, Chairman of Wipro, said, “Business leaders in the US continue to exhibit increased confidence on growth prospects. Clients are increasingly looking to drive business value from their technology investments. We are seeing positive sentiment in India with the confidence that the Government is focused on driving an agenda of growth.”

T K Kurien, Executive Director & Chief Executive Officer of Wipro, said, “While the industry landscape is still undergoing change, we see multiple opportunity spaces for growth and gaining market share. We continue to execute to our stated strategy of leveraging platforms for non-linear growth and creating differentiated solutions around the new technology paradigms.”

Suresh Senapaty, Executive Director & Chief Financial Officer of Wipro, said – “In Q2, we continued to build on our leadership position in Infrastructure Services and continued the momentum of deal wins. During the quarter, the benefits of rupee depreciation were negated by the US Dollar’s appreciation against other major currencies. We continued to drive productivity and improving operating levers even as the effect of salary hike on this quarter’s Operating Margin was on expected lines.”

 

1. For the convenience of the reader, the amounts in Indian rupees in this release have been translated into United States dollars at the noon buying rate in New York City on September 30, 2014, for cable transfers in Indian rupees, as certified by the Federal Reserve Board of New York, which was US $1= LOGO 61.92. However, the realized exchange rate in our IT Services business segment for the quarter ended September 30, 2014 was US$1= LOGO 61.66
2. Refers to ‘Profit for the period attributable to equity holders of the company’


Outlook for the Quarter ending December 31, 2014

We expect Revenues from our IT Services business to be in the range of $ 1,808 million to $ 1,842 million*.

 

* Guidance is based on the following exchange rates: GBP/USD at 1.65, Euro/USD at 1.31, AUD/USD at 0.92, USD/INR at 60.76 and USD/CAD at 1.10

IT Services

 

    IT Services Revenues in Rupee terms was LOGO 109.2 billion ($1.8 billion1), an increase of 8% YoY.

 

    IT Services Segment Result was LOGO 24.0 billion ($388 million1), an increase of 6% YoY.

 

    IT Services Revenue was $1,771.5 million, a sequential increase of 1.8% and YoY increase of 8.6%.

 

    Non-GAAP constant currency IT Services Revenue in dollar terms was $1,793.1 million, a growth of 3.0% QoQ, within our guidance range of $1,770 million to $1,810 million.

The IT Services segment had a headcount of 154,297 as of September 30, 2014. We added 50 new customers during the quarter.

During the quarter, Wipro completed the transaction announced on July 18, 2014 with ATCO Limited and the financials of the entities taken over were consolidated from August 2014.

Wipro continued its momentum in winning Large Deals globally as listed below:

Wipro has been chosen by CLK Enerji, Turkey’s largest electricity distribution and retail sales company, as its IT partner for a business transformation program. The program will enable CLK Enerji to expand further in the electricity retail market in Turkey and vastly improve its operational efficiencies.

Wipro has won a multi-year engagement with a global retailer to enable the transformation of its multi-channel customer experience platforms and drive cost takeout from ongoing operations. Wipro will integrate its capabilities in analytics, technology and process and leverage actionable insights to enable the customer’s business objectives.

Wipro was awarded a five year strategic infrastructure management contract by Philip Morris International. PMI is the leading international tobacco company, with products sold in more than 180 markets. As a part of the five-year agreement, Wipro will provide a full suite of IT infrastructure management services to PMI. The IT infrastructure services will support a host of functions at PMI including management and support of its servers, storage, backup and applications infrastructure.

Wipro has been engaged by a leading Hi-Tech manufacturer to support their consumer and market facing applications. Wipro’s engagement will help the enterprise in their transformational journey to become more nimble and provide a richer customer experience.

BP, one of the world’s largest international oil and gas companies, has renewed its Master Services Agreement with Wipro. Wipro, which has a long-standing association with BP which stretches back to 2003, will provide consulting, application management and application development services to BP under this renewed five-year group-wide strategic supplier agreement. The services will be delivered across BP’s operations, including Upstream, Refining, Marketing and Corporate functions in 13 countries across the globe.


A leading UK-based telecom provider has renewed its existing engagement with Wipro. Wipro has been a strategic partner to the telecom company for over 3 years. The award winning partnership has seen Wipro manage strategic initiatives such as OFCOM complaints, end-customer experience, the collections portfolio and become the primary inbound up-sell partner for the customer.

Wipro Digital has been chosen to partner in the digital transformation journey of a leading UK insurance firm, which is poised to re-imagine all aspects of its Life Insurance customer proposition, from engagement to servicing to product innovation. This transformation is more than just aligning to the digital lifestyle of the client’s customers. It is fundamentally about securing the client’s financial future following the regulatory dismantling of mandatory annuitisation, which had previously been a mainstay of their business model and strategy. As a partner of choice, Wipro will establish a digital capability which offers a broad based human-centric design proposition, with an architecture directly focused on addressing core customer needs.

Awards and accolades

Wipro was ranked as a leader for the fifth successive year in the ‘Global R&D Service Providers (GSPR) Rating 2014’ by Zinnov Management Consulting. The survey analyzed the top 50 R&D service providers across the world in 13 major industry segments. Service Providers were evaluated on the basis of their capabilities and vertical coverage and the analysis includes human capital, product development capabilities, financials, ecosystem linkages, infrastructure & innovation / IP creation, their non-linear strategy, lab infrastructure and customer relationships.

Wipro was cited as a ‘Leader’ and ‘Star Performer‘ in Banking IT Outsourcing by Everest Group in its report ‘IT Outsourcing in Banking – Service Provider Landscape with PEAK MatrixTM Assessment 2014’. Everest analysed the capabilities of 28 leading Applications Outsourcing service providers, specific to the global banking sector who were mapped on Everest Group’s Performance, Experience, Ability, Knowledge (PEAK) Matrix. In the report, Everest Group recognized Wipro’s Banking unit for showing the strongest forward movement on the PEAK Matrix, both in terms of market success and capability advancements.

Wipro was selected as a member of the global Dow Jones Sustainability Index (DJSI) - 2014 for the fifth year in succession. Wipro is included in both the DJSI World and Emerging Markets Indices. Further, Wipro is the global sector leader for the software and services industry.

Wipro was positioned in the ‘Winner’s Circle’, as a leading worldwide cloud infrastructure service provider, by the analyst firm HfS Research in its report “Blueprint Report on Cloud Infrastructure Services”. The ‘Winner’s Circle’ of the HfS Blueprint represents organizations that demonstrate excellence in both execution and innovation in cloud infrastructure services. The report acknowledges Wipro’s strong vision, concrete plans to invest in future cloud capabilities, a healthy cross-section of vertical capabilities, and a demonstrated ability to leverage external drivers to increase value for clients.

Wipro was named a ‘Major Player’ by the global technology research and advisory firm International Data Corporation (IDC) in its report IDC MarketScape: Worldwide Oil & Gas Professional Services 2014 Vendor Assessment, Doc #EI249425, June 2014. IDC evaluated leading Oil & Gas professional services providers across 25 criteria, relating to current offering, capability, strategy and market presence based on client inquiries, user needs assessments, and vendor and expert interviews.


IT Products

 

    Our IT Products segment delivered Revenue of LOGO 9.2 billion ($148 million1) for the quarter ended September 30, 2014.

 

    IT Products Segment results for the quarter ended September 30, 2014 was LOGO 62 million ($1 million1).

 

    IT Products Revenues for the fiscal year ended March 31, 2014 included sales of Wipro branded desktops, laptops and servers which Wipro ceased manufacturing in the quarter ended December 31, 2013.

Please refer the table on page 7 for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.

Wipro Inc Benefit Trust holds 1.8 million shares of Wipro Limited, arising out of a scheme of amalgamation between CMango India Private Limited, Mpower Software Services India Private Limited and Mpact Technology Services Pvt. Ltd. with Wipro Limited in 2007. Since the Trust Deed provides for dissolution following the sale of shares, the Trustees are now permitted to sell the shares in open market. The entire sale proceeds will accrue to the Trust whose sole beneficiary is Wipro LLC, a subsidiary of Wipro Limited. The Company will provide notice of the holding position upon sale of the shares and the dissolution of the Trust.

About Non-GAAP financial measures

This press release contains non-GAAP financial measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. Such non-GAAP financial measures are measures of our historical or future performance, financial position or cash flows that are adjusted to exclude or include amounts that are excluded or included, as the case may be, from the most directly comparable financial measure calculated and presented in accordance with IFRS.

The table on page 7 provides IT Services Revenue on a constant currency basis, which is a non-GAAP measure that is calculated by translating IT Services Revenue from the current reporting period into U.S. dollars based on the currency conversion rate in effect for the prior reporting period. We refer to growth rates in constant currency so that business results may be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our business performance.

This non-GAAP financial measure is not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, the most directly comparable financial measure calculated in accordance with IFRS, and may be different from non-GAAP measures used by other companies. In addition to this non-GAAP measure, the financial statements prepared in accordance with IFRS and the reconciliation of these non-GAAP financial measures with the most directly comparable IFRS financial measure should be carefully evaluated.

Results for the quarter ended September 30, 2014, prepared under IFRS, along with individual business segment reports, are available in the Investors section of our website www.wipro.com.


Quarterly Conference Call

We will hold an earnings conference call today at 07:15 p.m. Indian Standard Time (09:45 a.m. US Eastern Time) to discuss our performance for the quarter. An audio recording of the management discussions and the question and answer session will be available online and will be accessible in the Investor Relations section of our website at www.wipro.com.

About Wipro Limited (NYSE: WIT)

Wipro Ltd. (NYSE:WIT) is a leading Information Technology, Consulting and Business Process Services company that delivers solutions to enable its clients do business better. Wipro delivers winning business outcomes through its deep industry experience and a 360 degree view of “Business through Technology” - helping clients create successful and adaptive businesses. A company recognized globally for its comprehensive portfolio of services, a practitioner’s approach to delivering innovation, and an organization wide commitment to sustainability, Wipro has a workforce of over 140,000, serving clients in 175+ cities across 6 continents.

For more information, please visit www.wipro.com

 

Contact for Investor Relations    Contact for Media & Press   
Aravind V S    Vaibhav Saha    Vipin Nair   
Phone: +91-80-2505 6186    Phone:+1 732-509-1362    Phone: +91-80-3991-6154   
aravind.viswanathan@wipro.com    vaibhav.saha@wipro.com    vipin.nair1@wipro.com   

Forward-looking and Cautionary Statements

The forward-looking statements contained herein represent Wipro’s beliefs regarding future events, many of which are by their nature, inherently uncertain and outside Wipro’s control. Such statements include, but are not limited to, statements regarding Wipro’s growth prospects, its future financial operating results, and its plans, expectations and intentions. Wipro cautions readers that the forward-looking statements contained herein are subject to risks and uncertainties that could cause actual results to differ materially from the results anticipated by such statements. Such risks and uncertainties include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, revenue and profits, our ability to generate and manage growth, intense competition in IT services, our ability to maintain our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which we make strategic investments, withdrawal of fiscal governmental incentives, political instability, war, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property, and general economic conditions affecting our business and industry. Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission, including, but not limited to, Annual Reports on Form 20-F. These filings are available at www.sec.gov. We may, from time to time, make additional written and oral forward-looking statements, including statements contained in the company’s filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.

# # #

(Tables to follow)


WIPRO LIMITED AND SUBSIDIARIES

AUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

(Rupees in millions, except share and per share data, unless otherwise stated)

 

     As of March 31,     As of Sep 30,  
     2014     2014     2014  
                 Convenience
translation into
US$ in millions
(Unaudited)
Refer note 2 (iv)
 

ASSETS

      

Goodwill

     63,422        68,537        1,107   

Intangible assets

     1,936        9,488        153   

Property, plant and equipment

     51,449        54,729        884   

Derivative assets

     286        642        10   

Available for sale investments

     2,676        2,724        44   

Non-current tax assets

     10,192        10,122        163   

Deferred tax assets

     3,362        3,640        59   

Other non-current assets

     14,295        13,908        225   
  

 

 

   

 

 

   

 

 

 

Total non-current assets

     147,618        163,790        2,645   
  

 

 

   

 

 

   

 

 

 

Inventories

     2,293        2,776        45   

Trade receivables

     85,392        88,260        1,425   

Other current assets

     39,474        56,805        917   

Unbilled revenues

     39,334        42,479        686   

Available for sale investments

     60,557        66,727        1,078   

Current tax assets

     9,774        7,093        115   

Derivative assets

     3,661        2,831        46   

Cash and cash equivalents

     114,201        108,811        1,757   
  

 

 

   

 

 

   

 

 

 

Total current assets

     354,686        375,782        6,069   
  

 

 

   

 

 

   

 

 

 

TOTAL ASSETS

     502,304        539,572        8,714   
  

 

 

   

 

 

   

 

 

 

EQUITY

      

Share capital

     4,932        4,935        80   

Share premium

     12,664        13,090        211   

Retained earnings

     314,952        342,447        5,531   

Share based payment reserve

     1,021        1,287        21   

Other components of equity

     10,472        12,720        205   

Shares held by controlled trust

     (542     (542     (9
  

 

 

   

 

 

   

 

 

 

Equity attributable to the equity holders of the company

     343,499        373,937        6,039   

Non-controlling interest

     1,387        1,379        22   
  

 

 

   

 

 

   

 

 

 

Total equity

     344,886        375,316        6,061   
  

 

 

   

 

 

   

 

 

 

LIABILITIES

      

Long - term loans and borrowings

     10,909        11,124        179   

Deferred tax liabilities

     1,796        4,006        65   

Derivative liabilities

     629        472        8   

Non-current tax liability

     3,448        3,647        59   

Other non-current liabilities

     4,174        4,615        74   

Provisions

     6        7        —     
  

 

 

   

 

 

   

 

 

 

Total non-current liabilities

     20,962        23,871        386   
  

 

 

   

 

 

   

 

 

 

Loans and borrowings and bank overdrafts

     40,683        46,072        744   

Trade payables and accrued expenses

     52,256        54,160        875   

Unearned revenues

     12,767        13,513        218   

Current tax liabilities

     12,482        10,672        172   

Derivative liabilities

     2,504        2,026        33   

Other current liabilities

     14,394        12,630        204   

Provisions

     1,370        1,312        21   
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     136,456        140,385        2,267   
  

 

 

   

 

 

   

 

 

 

TOTAL LIABILITIES

     157,418        164,256        2,653   
  

 

 

   

 

 

   

 

 

 

TOTAL EQUITY AND LIABILITIES

     502,304        539,572        8,714   
  

 

 

   

 

 

   

 

 

 


Wipro limited and subsidiaries

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF INCOME

(Rupees in millions, except share and per share data, unless otherwise stated)

 

    Three Months ended September 30,     Six Months ended September 30,  
    2013     2014     2014     2013     2014     2014  
                Convenience
translation into US
dollar in millions
(unaudited)
                Convenience
translation into US
dollar in millions
(unaudited)
 

Gross revenues

    107,727        116,838        1,887        205,021        228,196        3,685   

Cost of revenues

    (74,207     (80,866     (1,306     (141,424     (155,807     (2,516

Gross profit

    33,520        35,972        581        63,597        72,389        1,169   

Selling and marketing expenses

    (7,605     (7,628     (123     (14,465     (15,185     (245

General and administrative expenses

    (5,686     (6,605     (107     (11,253     (12,792     (207

Foreign exchange gains/(losses), net

    2,193        1,323        21        2,245        2,421        39   

Results from operating activities

    22,422        23,062        372        40,124        46,833        756   

Finance expenses

    (656     (989     (16     (1,151     (1,877     (30

Finance and other income

    3,412        5,109        83        6,774        9,348        151   

Profit before tax

    25,178        27,182        439        45,747        54,304        877   

Income tax expense

    (5,754     (6,199     (100     (10,005     (12,141     (196
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Profit for the period

    19,424        20,983        339        35,742        42,163        681   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Attributable to:

           

Equity holders of the company

    19,321        20,848        337        35,555        41,880        676   

Non-controlling interest

    103        135        2        187        283        5   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Profit for the period

    19,424        20,983        339        35,742        42,163        681   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per equity share:

           

Attributable to equity share holders of the company

           

Basic

    7.87        8.49        0.14        14.48        17.05        0.28   

Diluted

    7.85        8.45        0.14        14.44        16.98        0.27   

Weighted average number of equity shares used in computing earnings per equity share

           

Basic

    2,454,919,674        2,455,543,231        2,455,543,231        2,454,939,900        2,455,543,231        2,455,543,231   

Diluted

    2,461,759,416        2,467,151,917        2,467,151,917        2,461,551,636        2,466,597,110        2,466,597,110   

Additional Information

           

Segment Revenue

           

IT Services Business Units

           

- BFSI

    26,570        28,411        459        50,262        56,476        912   

- HLS

    10,174        12,176        197        18,941        23,466        379   

- RCTG

    14,916        15,218        246        28,365        29,945        484   

- ENU

    15,897        18,333        296        30,125        35,155        568   

- MFG

    19,100        19,894        321        36,129        39,004        630   

- GMT

    14,022        15,203        246        26,220        30,272        489   

-OTHERS

    —          —          —          —          —          —     
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

IT SERVICES TOTAL

    100,679        109,235        1,764        190,042        214,318        3,461   

IT PRODUCTS

    9,374        9,152        148        17,540        16,812        272   

RECONCILING ITEM

    (133     (226     (4     (316     (513     (8
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

TOTAL

    109,920        118,161        1,908        207,266        230,617        3,724   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Segment Result

           

IT Services Business Units

           

- BFSI

    5,981        6,245        101        10,771        12,869        208   

- HLS

    1,904        2,422        39        3,308        4,553        74   

- RCTG

    3,252        3,205        52        5,800        6,393        103   

- ENU

    4,260        5,000        81        7,848        9,553        154   

- MFG

    4,489        4,034        65        7,874        8,402        136   

- GMT

    3,157        3,496        56        5,392        7,258        117   

- OTHERS

    —          608        10        —          583        9   

UNALLOCATED

    (399     (987     (16     (504     (1,611     (26
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

TOTAL IT SERVICES

    22,644        24,023        388        40,489        48,000        775   

IT PRODUCTS

    152        62        1        283        227        4   

RECONCILING ITEM

    (374     (1,023     (17     (648     (1,394     (23
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

TOTAL

    22,422        23,062        372        40,124        46,833        756   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

FINANCE EXPENSE

    (656     (989     (16     (1,151     (1,877     (30

FINANCE AND OTHER INCOME

    3,412        5,109        83        6,774        9,348        151   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

PROFIT BEFORE TAX

    25,178        27,182        439        45,747        54,304        877   

INCOME TAX EXPENSE

    (5,754     (6,199     (100     (10,005     (12,141     (196
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

PROFIT FOR THE PERIOD

    19,424        20,983        339        35,742        42,163        681   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Segment result represents operating profits of the segments and dividend income and gains or losses (net) relating to strategic investments, which are presented within “Finance and other income” in the statement of Income.

The Company is organized by the following operating segments; IT Services and IT Products. IT Services: The IT Services segment primarily consists of IT Service offerings to our customers organized by industry verticals as follows: Banking, Financial Services and Insurance (BFSI), Healthcare and Life Sciences (HLS), Retail, Consumer, Transport and Government (RCTG), Energy, Natural Resources and Utilities (ENU), Manufacturing (MFG), Global Media and Telecom (GMT). Starting with quarter ended September 30, 2014, it also includes Others which comprises dividend income and gains or losses (net) relating to strategic investments, which are presented within “Finance and other income” in the statement of Income. Key service offering to customers includes software application development and maintenance, research and development services for hardware and software design, business application services, analytics, consulting, infrastructure outsourcing services and business process outsourcing services.

The IT Products segment sells a range of Wipro personal desktop computers, Wipro servers and Wipro notebooks. The Company is also a value added reseller of desktops, servers, notebooks, storage products, networking solutions and packaged software for leading international brands. In certain total outsourcing contracts of the IT Services segment, the Company delivers hardware, software products and other related deliverables. During the fiscal year ended March 31, 2014 the Company ceased the manufacturing of ‘Wipro branded desktops, laptops and servers’. Revenue relating to the above items is reported as revenue from the sale of IT Products.

 

Reconciliation of Non-GAAP Constant Currency IT Services Revenue to IT Services Revenue as per IFRS ($MN)  

IT Services Revenue as per IFRS

     1,771.5       IT Services Revenue as per IFRS      1,771.5   

Effect of Foreign currency exchange movement

     21.6       Effect of Foreign currency exchange movement      (5.0
  

 

 

       

 

 

 

Non-GAAP Constant Currency IT Services Revenue based on previous quarter exchange rates

     1,793.1       Non-GAAP Constant Currency IT Services Revenue based on previous year exchange rates      1,766.5   

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