Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for its quarter ended September 30, 2019.
Highlights of the Results Results for the Quarter ended September 30, 2019:
Gross Revenue was ₹151.3 billion ($2.1 billion1 ), an increase of 4.0% YoY
IT Services Segment Revenue was at $2,048.9 million, an adjusted2 increase of 2.5% YoY
Non-GAAP3 constant currency IT Services Segment Revenue increased by 1.1% QoQ. Adjusted2 Non-GAAP3 constant currency IT Services Segment Revenue grew 3.8% YoY
IT Services Operating Margin4 for the quarter was at 18.1%, an increase of 3.1% YoY
Net Income for the quarter was ₹25.5 billion ($361.4 million1 ), an increase of 35.1% YoY
EPS for the quarter was ₹4.3 ($0.061 ) per share and grew 36.7% YoY
Performance for the quarter ended September 30, 2019 Abidali Z. Neemuchwala, CEO and Managing Director said, “We had a good in-quarter execution on both revenues and margins. The overall growth was broad based with 6 out of 7 industry verticals growing on a YoY basis and we signed a large deal in India aligned to our strategy of taking global offerings to India customers.”
Jatin Dalal, Chief Financial Officer said, “We delivered operating margins in a tight range after absorbing the impact of two months of wage hike. Growth remains our priority and we remain invested for future. We also successfully completed the Share Buyback program in September, which saw strong participation from our investors.”
Outlook for the Quarter ending December 31, 2019 We expect Revenue from our IT Services business to be in the range of $2,065 million to $2,106 million*. This translates to a sequential growth of 0.8% to 2.8%.
Share Buyback Update In the quarter ended September 30, 2019, the Company has concluded the buyback of 323.1 million equity shares as approved earlier by the Board of Directors at their meeting held on April 16, 2019. This has resulted in a total cash outflow of ₹105 billion ($1.49 billion1 )
IT Services Wipro continued its momentum in winning large deals globally as described below: Wipro has secured a multi-year engagement with a top North America based global bank to provide DevOps services which will enable the bank to launch new products swiftly and go-to-market faster at an optimal cost. Wipro has won a transformation deal with a leading digital media and broadcasting company to digitize their enterprise processes to deliver better stakeholder experience. A large US-based healthcare company has renewed its contract with Wipro to automate its claims process and improve efficiency, leveraging the capabilities of Wipro HOLMES™. A UK-based global software company has awarded Wipro a contract to build, test, and transform its IT operations across core business applications including finance, sales and customer relationship management. A major European industrial manufacturing company has renewed and expanded its existing contract with Wipro for workplace digitalization and service desk support.
Digital & Cloud Application Services Highlights We continue to see increasing traction in digital oriented deals as illustrated below: A global e-commerce and internet company has chosen Appirio to streamline the customer relationship management process for its employees by migrating to a cloud-based customer service platform. A leading US-based medical technology company has chosen Wipro to automate its key business processes for enhanced user experience and cost optimization. A multinational publication and media company has selected Wipro to implement a newly launched digital subscription management product, enabling seamless integration of its various internal functions as well as transform the client’s user experience. A large telecommunications company has awarded Wipro a multi-year deal to provide network test automation and crowd sourcing engagement services leveraging Topcoder. A US-based university has chosen Appirio to help migrate to a new cloud-based system, which will enable the institution to centralize their data and derive sharper insights.
Analyst Accolades and Awards: Wipro was positioned as a Leader in The Forrester Wave™: Application Modernization And Migration Services, Q3 2019. Wipro positioned as a Leader in Gartner Magic Quadrant for Data Center Outsourcing and Hybrid Infrastructure Managed Services, Asia/Pacific, DD Mishra, To Chee Eng, Claudio Da Rold, 24 Jul-2019. Wipro was positioned as a Leader in The Forrester Wave™: AI Consultancies, Q3 2019. Wipro was positioned as a Leader in IDC MarketScape: Worldwide Professional Services Firms for Utilities Customer Experience 2019 Vendor Assessment. (Doc #US43251618, July 2019). Wipro was positioned as a Leader and Star Performer in Everest Group Banking BPS – Service Provider Landscape with Services PEAK Matrix™ Assessment 2019. Wipro was positioned as a Leader in Everest Group Life Sciences Digital Services – Service Provider Landscape with Services PEAK Matrix™ Assessment 2019. Wipro positioned as a Leader in multiple quadrants in ISG Provider Lens™ Network – Software Defined Solutions & Services, Global, UK & Nordics.
IT Products: IT Products Segment Revenue for the quarter was ₹3.2 billion ($45.8 million1 ). IT Products Operating Margin4 for the quarter was 4.6%.
India business from State Run Enterprises (SRE): India SRE Segment Revenue for the quarter was ₹2.1 billion ($29.3 million1 ). India SRE Operating Margin4 for the quarter was –8.5%.
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 tables on page 8 provide IT Services Revenue on a constant currency basis, which is a non-GAAP financial 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. Further, in the normal course of business, we may divest a portion of our business which may not be strategic. We refer to the growth rates in both reported and constant currency adjusting for such divestments in order to represent the comparable growth rates. 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.