IT bellwether Infosys Technologies on Wednesday reported a 29-per cent increase in the net profit for 2008-09 but warned that earnings could slowdown significantly in 2009-10 as a result of the global financial meltdown.
Presenting the results at a media conference here, Infosys CEO and Managing Director S. Gopalakrishnan said the company’s “velocity of business” had been impaired by the global financial crisis.
Revenues (consolidated) increased by 30 per cent to Rs. 21,693 crore in 2008-09. The company made a post-tax profit of Rs. 5,988 crore, an increase of 28.5 per cent over the previous year. It registered a net profit of Rs. 1,613 crore in the last quarter of 2008-09, which amounted to an increase of 29.1 per cent over the same quarter of the previous year. Earnings in the fourth quarter were Rs. 5,635 crore, an increase of 24.1 per cent over the same quarter of 2007-08.
Mr. Gopalakrishnan acknowledged that the continuing slide of the rupee versus the dollar in the last quarter had a “positive impact”. In fact, earnings in dollar terms declined by 1.8 per cent on a year-on-year basis. However, post-tax income increased by 2.6 per cent to $321 million in the last quarter of 2008-09. Revenues, represented in dollars, increased by 11.7 per cent to $4,663 million in 2008-09.
The board of directors of the company recommended a final dividend of Rs. 13.50 a share on a par value of Rs. 5 for the year.
An interim dividend of Rs. 10 per share was already paid. The company, for the first time in its history, has presented an “outlook” that forecasts a decline in revenues. The forecast for the first quarter of 2009-10 ending on June 30 is that revenues in dollar terms are expected to be in the region of between $1,060 million and $1,080 million, which implies a decline of between 8.2 per cent and 6.5 per cent on a year-on-year basis. In rupee terms, the forecast for the said quarter is Rs. 5,379-5,480 crore, implying a growth of 10.8-12.9 per cent. Revenues for the full financial year are expected to decline by between 3.1 per cent and 6.7 per cent. This is based on the forecast that revenues would range between $4.35 billion and $4.52 billion in 2009-10. Mr. Gopalakrishnan said the “guidance” for 2009-10 was based on the assessment that revenues would decline in the first quarter but that this would be followed by “a slow recovery” during the rest of the year.
WorkforceThe company added 37 new clients in the last quarter. At the end of 2008-09, the company had a workforce of 1.05 lakh. During the year the company recruited about 28,000 persons, but net additions amounted to 13,663 employees.
Mr. Gopalakrishnan said the “extreme uncertainty” resulting from the global economic crisis had affected the company.
“But, overall, I think we have managed to do well despite the adversity,” he added. “The biggest problem for the company is achieving growth. With growth all problems can be solved,’ he said.
