Wipro net declines 21% in Q4, 5.9% in 2017-18

Bengaluru: Global software major Wipro on Wednesday reported that its consolidated net profit declined 21 per cent annually for the fourth quarter and 5.9 per cent yearly for fiscal 2017-18.

“Consolidated net profit for the fourth quarter declined 21 per cent year-on-year to Rs 1,801 crore from Rs 2,267 crore in the same period year ago.

“Net profit for the fiscal also declined 5.9 per cent to Rs 8,008 crore from Rs 8,514 crore in 2016-17,” said the company in a regulatory filing on the BSE.

Sequentially too, net profit declined 7.2 per cent from Rs 1,940 crore posted in the third quarter.

Consolidated revenue for the quarter also declined, albeit marginally, by 1.6 per cent to Rs 13,769 crore from Rs 13,988 crore in the same period last fiscal and remained flat sequentially as against Rs 13,670 crore last quarter.

Consolidated revenue for the fiscal also remained flat at Rs 54,487 crore as against Rs 55,040 crore in 2016-17.

Under the International Financial Reporting Standards (IFRS), net income was $277 million and gross revenue $2,115 million for the quarter.

For the fiscal under IFRS, net income was $1.2 billion and gross revenue $8.4 billion, an annual decline of 1 per cent.

IT services for the quarter contributed $2,062 million, posting 2.4 per cent sequential and 5.5 per cent growth under IFRS and Rs 13,410 crore in rupee terms, up 1.3 per cent sequentially from quarter ago.

For the fiscal, IT services revenue remained flat at Rs 52,840 crore or $8.1 billion.

The firm projected lower sequential revenue for the first quarter of 2018-19 from IT services business in dollar terms.

“We expect revenue from our IT services to be in the range of $2,015-2,065 million for the first quarter ending June 30,” said the filing.

The outlook is less than $2,033-2,073 million range it projected for the fourth quarter of fiscal 2017-18 on January 19 and $2,062 million it reported.

Wipro Chief Executive Abidali Neemuchwala told reporters here later that investments in digital and efforts in client mining were paying off well.

“Our strong order bookings in the last two quarters provide us the right foundation to grow as we progress through the year,” he said.

Chief Financial Officer Jatin Dalal said that investments in Holmestm and automation software were resulting in productivity improvement.

“We generated robust operating cash flows of Rs 8,400 crore at 105 per cent of our net income for the fiscal 2017-18,” he said.

The company declared 50 per cent interim dividend of Rs 1 per share of Rs 2 face value for the fiscal.

With the board recommending the interim dividend as the final dividend, the total dividend for the fiscal remains Rs 1 per share.

Under the capital allocation policy, the company has completed a buyback of its shares valued at Rs 110,000 million in December 2017.

The company made an annual provision of Rs 526 crore ($81 million) for the insolvency of two customers and impairment loss in one of its acquisitions.

The company added 58 new clients in Q4, taking the total to 233 for the fiscal, while the number of active customers to 1,248 for the year.

Though 1,274 techies were added for the quarter, the total headcount for the fiscal declined to 1,63,827 from 1,65,481 year ago due to higher attrition (16.6 per cent) in Q4 as against 16.3 per cent year ago.

The company’s blue-chip scrip of Rs 2 face value was sold at Rs 287.20 per share at the end of Wednesday’s trading on the BSE as against Tuesday’s closing price of Rs 287.05 and opening price of Rs 289.