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Company Name : WIPRO

Tuesday, October 17, 2017 7:55PM IST (2:25PM GMT)

NYSE:WIT(BSE:507685)(NSE:WIPRO)(NYSE:WIT)

Wipro Limited Announces Results for the quarter ended September 30, 2017 under IFRS


IT Services Revenue crossed $2 billion for the quarter


East Brunswick, New Jersey, United States & Bangalore, Karnataka, India

Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for its quarter ended September 30, 2017.
 
Highlights of the Results

  • Gross Revenues of Wipro Limited were Rs134.2 billion ($2.1 billion1).
  • IT Services Segment Revenues in dollar terms were $2,013.5 million, an increase of 2.1% sequentially
(Non-GAAP constant currency increase of 0.3% sequentially) and 5.1% YoY (Non-GAAP constant currency increase of 2.8% YoY).
  • IT Services Segment Profits2 were Rs22.8 billion ($349 million1), an increase of 4.0% sequentially.
  • IT Services Margin for the quarter was 17.3%, as compared to 16.8% for the quarter ended June 30, 2017.
  • Net Income3 for the quarter was Rs21.9 billion ($336 million1), an increase of 5.5% sequentially and 6.0% YoY.
Performance for the quarter ended September 30, 2017
 
“We surpassed the milestone of $2 billion in quarterly revenues for IT Services on the back of rigorous execution of our strategy,” said Abidali Z. Neemuchwala, Chief Executive Officer and Member of the Board. “Our unique Digital capabilities powered growth in top clients and position us well to drive our clients’ digital transformation.”
 
“Productivity gains generated by our HOLMES automation suite and operational efficiencies overcame the incremental impact of wage hikes and expanded IT Services margin to 17.3%,” said Jatin Dalal, Chief Financial Officer.
 
Outlook for the Quarter ending December 31, 2017
We expect Revenues from our IT Services business to be in the range of $2,014 million to $2,054 million*.
 
* Guidance is based on the following exchange rates: GBP/USD at 1.34, Euro/USD at 1.19, AUD/USD at 0.81, USD/INR at 64.26 and USD/CAD at 1.23.
 
Capital Allocation Update
 
  • As disclosed earlier, on July 20, 2017 the Board approved a proposal for Buyback of up to 343.75 million equity shares at a price of Rs320 per equity share. The Buyback proposal was subsequently approved by the shareholders through postal ballot, the results of which were declared on August 30, 2017. The Buyback offer period will commence upon completion of regulatory requirements.
 
IT Services
 
Wipro continued its momentum in winning large deals globally as described below:
 
A leading US-based chemical manufacturing company has awarded an IT applications and back office operations transformation contract to Wipro. Wipro will leverage its intellectual properties and technology solutions including Wipro HOLMES™ for this engagement.
 
Wipro has won a multi-year engagement with a leading multinational technology company to help deliver a software platform with high quality and reduced time to market. Wipro will support the client’s agile release model by driving automation, data-driven prioritization and optimization.
 
Wipro has won a multi-year engagement with an automotive Tier-I company for supporting and modernizing their IT infrastructure, across their global locations. This program will leverage the Wipro HOLMESTM artificial intelligence platform to improve end user experience, reduce costs and drive innovation for the client.
 
Ooredoo Myanmar (OML), a telecom company has selected Wipro as its technology managed services partner. As part of the five-year engagement, Wipro will manage Ooredoo’s IT infrastructure in an agile delivery model and will leverage the Wipro HOLMESTM artificial intelligence platform to drive hyper-automation. The engagement will help enhance the client’s business and operational agility, improve the time to market of their services and enhance end-customer experience through improved Quality of Service.
 
An Asian transport and infrastructure government body has selected Wipro as its strategic partner to develop and implement an integrated payment and collection system.
 
Wipro worked with leading US based Apparel and Footwear manufacturer to re-define their application support landscape leveraging hyper automation through Wipro HOLMESTM, right shoring, redefining the operating model and driving improved end-user experience.
 
Digital highlights
 
Wipro continued its momentum in winning Digital deals globally as described below:
 
Wipro has won a large IoT and IT infrastructure modernization contract from a large Europe-based medical devices manufacturer. The engagement will help the client improve the product and service experience of their medical devices, across the globe, through enhanced after-sales remote monitoring support and predictive maintenance.
 
Wipro has won a large multi-year omni-channel customer experience transformation engagement from a leading telecom company in the APAC region. Wipro will leverage its digital engineering capabilities to improve customer advocacy, issue resolution rates and accelerate end-customers’ shift towards digital CRM and self-help channels.
 
A global pharmaceutical company has selected Wipro Digital to facilitate its transformation into a customer centric organization that is able to create internal and external value out of its vast amounts of health-related data. Wipro will bring new skills and ways of working to the organization aimed to imagine and launch innovative products based on data.
 
Wipro has been selected as the digital partner for a North American bank for consolidating their Cards portfolio into a single platform. The scope is end-to-end from planning to implementation. The engagement will involve transformation using automation, adoption of DevOps and Agile methodology.
 
Wipro has won an integrated cloud-based transformation deal, from a leading Latin American conglomerate, as part of a multi-year digital program. The engagement will involve simplifying commerce, Procure2Pay and Human Capital Management processes.
 
Wipro won a number of deals across business verticals in the cloud applications space leveraging Appirio Cloud Services. A couple of examples are as below
  • A US-based voluntary health organization has selected Wipro as a lead partner to transform customer experience. 
  • A renowned private research institute has awarded Wipro a contract to build a new constituent management system on Salesforce.
 
Delivery Excellence
 
“Wipro’s proactive approach to Problem Management and Quality Assurance has added immeasurable value to our organization and has allowed us to remain proactive and meet any industry challenges we have faced. The close working relationship with Wipro has been very beneficial to us and ensured that when new opportunities arise we can deliver solutions in a timely manner. Culturally, Wipro is an excellent fit to our organization with our shared common values of integrity and sensitivity,” said Arnie Leap, Chief Information Officer, 1-800-Flowers.com, Inc.
 
“Wipro manages a large portion of our IT real estate and is a key player in our innovation ecosystem. Wipro’s process, technological and domain maturity as a customer centric and SMART IT organization has helped us build transformational capabilities and incubate ideas that help us improve health outcomes & enhance the experiences for our patients. We are planning to actively leverage Wipro’s HOLMES as a mechanism to drive experience, efficiency and economy across our value chain. As the leading biotech focused on rare disease, our partnership with Wipro has helped us unlock numerous business benefits while delivering exceptional value to patients and caregivers struggling with a life-altering condition,” said Gabriele Ricci, VP, Head of Digital Health and Emerging Technology, Shire.
 
Analyst Accolades and Awards
 
Wipro’s Open Banking API Platform won the 2017 API Awards at API World under the ‘Travel APIs’ category. Open Banking APIs enable banks / other financial value providers to gain insights into customer’s banking habits and data, thereby providing contextual suggestions for engagement.
 
Wipro is amongst the top 6 firms in the Constellation Research shortlist on “Synchronous Ledger Tech (Blockchain) Companies to Watch For”.
 
Wipro has been placed as a ‘Winner’ in three HfS Blueprints: Digital Technology Strategy and Consultancy Services; Application Development and Management Services 2017; and IT infra Management and Enterprise Cloud Services.
 
Wipro has been placed as a ‘Winner’ in the HfS Application Testing Services Supporting Digital Transformation Blueprint report 2017.
 
Wipro has been placed as a ‘Winner’ in the HfS Energy Operations Blueprint Report 2017.
 
Wipro has been placed as a ‘Winner’ in the HfS Embedded and Semiconductor Engineering Services Blueprint Report 2017.
 
IDC MarketScape has named Wipro as a ‘Leader’ in the IDC MarketScape: Worldwide Cloud ERP Implementation Services 2017 Vendor Assessment (Doc #US41523417, July 2017).
 
Wipro has been positioned as a Leader by Everest Group, a global independent consulting and research firm, in the PEAK Matrix™ Assessments for Automation in IT Application Dev-Test and Business Process Service Delivery Automation (BPSDA).
 
IT Products
  • Revenue for the quarter ended September 30, 2017 was Rs3.0 billion ($46 million1).
  • IT Products Margin for the quarter was 2.9%, as compared to 0.5% for the quarter ended June 30, 2017.
 
Please refer the table at the end for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.
 
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 at the end provides 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.
 
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, 2017, 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. U.S. Eastern Time) to discuss our performance for the quarter. The audio from the conference call will be available online through a web-cast and can be accessed at the following link- http://services.choruscall.eu/links/wipro171017.html

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

All product names, logos, and brands are property of their respective owners.

About Wipro Limited 

Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) is a leading global information technology, consulting and business process services company. We harness the power of cognitive computing, hyper-automation, robotics, cloud, analytics and emerging technologies to help our clients adapt to the digital world and make them successful. A company recognized globally for its comprehensive portfolio of services, strong commitment to sustainability and good corporate citizenship, we have over 160,000 dedicated employees serving clients across six continents. Together, we discover ideas and connect the dots to build a better and a bold new future.

Forward-looking 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, complete proposed corporate actions, 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.
 
Wipro limited and subsidiaries
CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION
(Rupees in millions, except share and per share data, unless otherwise stated)
             
  As of March 31,   As of Sep 30,
    2017   2017   2017
            Convenience translation into US dollar in millions (unaudited) - Refer footnote 1
ASSETS            
Goodwill   125,796                          128,839                            1,973
Intangible assets                            15,922   20,571                               315
Property, plant and equipment                            69,794                           71,803                            1,100
Derivative assets                                106                                493                                  8
Investments                              7,103                             9,844                               151
Investment in equity accounted investee                                    407                                  6
Trade receivables                              3,998                             4,179                                64
Non-current tax assets                            12,008                           15,037                               230
Deferred tax assets                              3,098                             3,088                                47
Other non-current assets                            16,793                           15,755                               241
Total non-current assets                          254,618                          270,016                            4,135
             
Inventories                              3,915                             3,456                                53
Trade receivables                            94,846                           99,887                            1,530
Other current assets                            30,751                           31,484                               482
Unbilled revenues                            45,095                           45,435                               696
Investments                          292,030                          333,056                            5,100
Current tax assets                              9,804                             6,132                                94
Derivative assets                              9,747                             2,352                                36
Cash and cash equivalents                            52,710                           51,412                               787
Total  current assets                          538,898                          573,214                            8,778
TOTAL ASSETS                          793,516                          843,230                          12,913
             
EQUITY            
Share capital   4,861                             9,733                               149
Share premium                                469                             2,231                                34
Retained earnings                          490,930                          529,496                            8,109
Share based payment reserve                              3,555                             1,593                                24
Other components of equity                            20,489                           19,397                               297
Equity attributable to the equity holders of the Company                          520,304                          562,450                            8,613
Non-controlling interest                              2,391                             2,445                                37
Total equity                          522,695                          564,895                            8,650
             
LIABILITIES            
Long - term loans and borrowings                            19,611                           31,152                               477
Deferred tax liabilities                              6,614                             7,464                               114
Derivative liabilities                                    2                                  -                                   -  
Non-current tax liabilities                              9,547                             8,607                               132
Other non-current liabilities                              5,500                             4,605                                71
Provisions                                    4                                   3                                  0
Total non-current liabilities                            41,278                           51,831                               794
             
Loans, borrowings and bank overdrafts                          122,801                          114,210                            1,749
Trade payables and accrued expenses                            65,486                           69,640                            1,066
Unearned revenues                            16,150                           16,040                               246
Current tax liabilities                              8,101                             7,420                               114
Derivative liabilities                              2,708                             3,530                                54
Other current liabilities                            13,027                           14,642                               224
Provisions                              1,270                             1,022                                16
Total current liabilities                          229,543                          226,504                            3,469
TOTAL LIABILITIES                          270,821                          278,335                            4,263
                                                                                                                
TOTAL EQUITY AND LIABILITIES                          793,516                          843,230                          12,913
 
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,      
  2016   2017 2017   2016   2017 2017
         Convenience translation into US dollar in millions  (unaudited) Refer footnote 1          Convenience translation into US dollar in millions  (unaudited) Refer footnote 1
Gross revenues            137,657                          134,234                        2,056               273,649              270,495                       4,142
Cost of revenues            (97,808)                          (94,694)                       (1,450)              (194,197)             (191,805)                      (2,937)
Gross profit            39,849   39,540    606   79,452    78,690   1,205
                   
Selling and marketing expenses              (9,614)                            (9,867)                         (151)               (19,755)              (20,013)                        (306)
General and administrative expenses              (8,545)                            (7,085)                         (109)               (16,144)              (14,349)                        (220)
Foreign exchange gains/(losses), net                1,281                                453                              7                   2,265                    806                           12
                   
Results from operating activities            22,971     23,041  353   45,818   45,134  691
                   
Finance expenses              (1,428)                            (1,386)                           (21)                 (2,764)                (2,860)                          (44)
Finance and other income                5,105                             6,661                           102                 10,305                12,861                          197
Share of profits/(loss) of equity accounted investee                    -                                     5                             -                         -                          4                            -  
Profit before tax            26,648                          28,321                          434               53,359              55,139                         844
Income tax expense  (5,909)    (6,426)   (98)    (12,031)    (12,420)  (190)
Profit for the period  20,739    21,895   336      41,328      42,719   654
                   
Attributable to:                  
Equity holders of the company              20,672                            21,917                           336                 41,190                42,682                          653
Non-controlling interest       67         (22)       -           138          37       1
Profit for the period  20,739     21,895     336    41,328    42,719   654
                   
                   
Earnings per equity share:                  
Attributable to equity share holders of the company                  
Basic                 4.27      4.52  0.07   8.44     8.81  0.13
Diluted                 4.26                               4.52                          0.07                    8.42                   8.80                         0.13
                   
Weighted average number of equity shares used in                  
computing earnings per equity share                  
Basic    4,841,242,274                 4,845,485,149            4,845,485,149       4,878,025,634      4,844,289,024           4,844,289,024
Diluted    4,853,625,288                 4,852,992,546            4,852,992,546       4,890,933,302      4,852,340,224           4,852,340,224
                   
Additional Information                  
Segment Revenue                  
IT Services Business Units                  
BFSI              33,583                            36,349                           557                 67,213                71,283                       1,092
HLS              20,883                            17,989                           275                 40,814                37,139                          569
CBU              20,708                            20,989                           321                 41,433                41,524                          636
ENU              16,881                            17,769                           272                 34,237                35,233                          540
MNT              29,463                            30,010                           460                 59,001                59,352                          909
COMM     9,848       8,583      131     19,760      17,414     265
IT SERVICES TOTAL 131,366    131,689   2,016   262,458    261,945  4,011
IT PRODUCTS                7,666                             2,988                             47                 13,596                  9,331                          143
RECONCILING ITEMS       (94)           10       -          (140)           25         0
TOTAL 138,938    134,687  2,063    275,914    271,301   4,154
                   
Segment Result                  
IT Services Business Units                  
BFSI                6,379                             6,055                             93                 13,373                11,496                          176
HLS                3,234                             2,698                             41                   6,090                  5,432                           83
CBU                3,584                             3,244                             50                   7,359                  6,178                           95
ENU                3,443                             3,435                             53                   6,468                  7,086                          109
MNT                6,175                             5,400                             83                 12,129                10,575                          162
COMM                1,594                             1,147                             18                   3,096                  2,596                           40
OTHERS                    -                                    -                               -            
UNALLOCATED (1,037)        805    11   (1,874)     1,337     20
TOTAL IT SERVICES              23,372                            22,784                           349                 46,641                44,700                          685
IT PRODUCTS                 (298)                                  88                              1                    (666)                    119                             2
RECONCILING ITEMS    (103)        169     3       (157)        315      5
TOTAL  22,971    23,041  353    45,818    45,134  691
FINANCE EXPENSE              (1,428)                            (1,386)                           (21)                 (2,764)                (2,860)                          (44)
FINANCE AND OTHER INCOME                5,105                             6,661                           102                 10,305                12,861                          197
SHARE OF PROFIT/(LOSS) OF EQUITY ACCOUNTED INVESTEE            5     -            -             4     0
PROFIT BEFORE TAX              26,648                            28,321                           434                 53,359                55,139                          844
INCOME TAX EXPENSE (5,909)    (6,426)   (98)   (12,031)    (12,420)  (190)
PROFIT FOR THE PERIOD 20,739    21,895   336    41,328     42,719   654

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.
The IT Services segment primarily consists of IT Service offerings to customers organized by industry verticals. The industry verticals are as follows: Banking,Financial Services and Insurance (BFSI), Healthcare & Lifesciences (HLS), Consumer Business Unit (CBU), Energy, Natural Resources & Utilities (ENU), Manufacturing & Technology (MNT), Communications (COMM). IT Services segment also includes Others which comprises dividend income relating to strategic investments, which are presented within “Finance and other income” in the statement of Income. Key service offerings 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 services.In the IT Products segment, the Company is 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 products, software licenses and other related deliverables.
 
Reconciliation  of Non-GAAP Constant Currency IT Services Revenue to IT Services Revenue as per IFRS ($MN)
Three Months ended September 30,2017
 
IT Services Revenue as per IFRS  $ 2,013.5     IT Services Revenue as per IFRS      $ 2,013.5
Effect of Foreign currency exchange movement  $ (36.6)     Effect of Foreign currency exchange movement      $  (44.1)
Non-GAAP Constant Currency IT Services Revenue based on previous quarter exchange rates  $ 1,976.9     Non-GAAP Constant Currency IT Services Revenue based on previous year exchange rates  $ 1,969.4
  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, 2017, for cable transfers in Indian Rupees, as certified by the Federal Reserve Board of New York, which was US $1= Rs 65.30. However, the realized exchange rate in our IT Services business segment for the quarter ended September 30, 2017 was US$1= Rs 65.40
  1. Segment Profit refers to Segment Results Total.
  2. Net Income refers to ‘Profit for the period attributable to equity holders of the Company’


Click here for Media Contact Details

Pavan N Rao, Investor Relations, Wipro Limited, +91 (80) 46726143, pavan.rao@wipro.com

Abhishek Kumar Jain, Investor Relations, Wipro Limited, +1 978 826 4700, abhishekkumar.jain@wipro.com

Vipin Nair, Media & Press, Wipro Limited, +91 (80) 39916450, vipin.nair1@wipro.com


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17/11/2017 7:30PM

Double Win for Vocalink at the 2017 Payments Awards

Vocalink, a Mastercard company, was last night awarded with two prestigious awards - The Overall Winner and the Payments Infrastructure of the Year Award, for its leading technology and expertise, and in ...

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17/11/2017 6:56PM

Envion AG: Start-up from the Heart of Berlin Has Pioneered Decentralized Mobile Mining by Combining Blockchain with Regenerative Energy

Envion AG has created a technology for the first truly mobile data-center that uses low-priced local energy to mine a broad spectrum of cryptocurrencies (Bitcoin, Ethereum, etc.). By harvesting locally available clean ...

News Summary

Wipro Limited today announced financial results under International Financial Reporting Standards (IFRS) for its quarter ended September 30, 2017.