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  1. HCL Technologies Q1 results: Top 10 key takeaways

HCL Technologies Q1 results: Top 10 key takeaways

Offshore IT and software development outsourcing company HCL Technologies announced its quarterly (Q1) results on Monday before market hours - the standalone net profit dropped by 2.12 per cent quarter-on-quarter.

By: | New Delhi | Updated: October 19, 2015 11:00 AM
hcl technologies

The Board of Directors of HCL Tech has approved the Scheme of Arrangement (“Scheme”) between HCL Technologies and HCL Comnet (a wholly owned subsidiary of the Company). (Express archive)

Offshore IT and software development outsourcing company HCL Technologies announced its quarterly (Q1) results on Monday before market hours – the standalone net profit dropped by 2.12 per cent quarter-on-quarter. Along with the September quarter results, the company also informed stock exchanges about the appointment of an additional director and announced an interim dividend, which the company will pay in November.

Earlier, HCL Technologies had already warned of a “tepid” September quarter on account of adverse currency impact and a client-specific issue. Following are top key takeaways from HCL Tech’s September 2015 numbers:

1. Net profit: IT major HCL Technologies reported a quarter-on-quarter drop in standalone net profit at Rs 1,404.63 crore for the first quarter ended September 30, 2015. The company had posted net profit of Rs 1,435.17 crore in the sequential quarter ended June 30, 2015 and Rs 1,682.56 crore in the corresponding quarter ended September 30, 2014. The company’s consolidated Q1 profit declined by 3.2 per cent sequentially to Rs 1,726 crore from Rs 1,783 crore.

2. Dividend: HCL Technologies informed that the Board of Directors of the company at its meeting held onOctober 19, 2015, has declared an interim dividend of Rs 5 per equity share of Rs 2 each of the company for the year 2015-16. The payment date of the said interim dividend shall be November 02, 2015.

3. Sales: For the quarter ended September 2015, the company posted standalone sales of Rs 4,349.72 crore, up 7.28 per cent against Rs 4,054.40 crore in the corresponding quarter a year ago.

4. Appointment of additional director: HCL Technologies also informed that Thomas Sieber has been appointed as an Additional Director on the Board of the Company with effect from October 17, 2015 to hold office as an Independent Director.

5. Headcount: HCL Technologies saw an exit of 536 employees during the September quarter, taking the total headcount to 1,05,571.

6. Stock Option Plan: The Board of Directors also approved the amendment in 2004 Stock Option Plan (“ESOP Plan”) of the company to include the provisions for the implementation of the plan through a Trust mechanism, in accordance with the Securities Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (“SEBI Regulations”). This amendment in the ESOP Plan is subject to the approval of the Shareholders.

7. Scheme of Arrangement: The Board of Directors of HCL Tech has approved the Scheme of Arrangement (“Scheme”) between HCL Technologies and HCL Comnet (a wholly owned subsidiary of the Company). As per the Scheme, the India System Integration Business of the company would be transferred to HCL Comnet Limited on a going concern basis with an objective to have simplified business structure with greater visibility in the performance of individual businesses. The said Scheme is subject to requisite approvals.

8.Other announcements: HCL Technologies has been selected by a major Transport Provider in UK to provide Managed Services for its entire SAP landscape. The IT major also won 10 tranformational engagements during this quarter in excess of $1bn in TCV by booking led by Infra & ERS.

9. Total Expenditure: Total expenditure of the company increased 23 per cent year-on-year to Rs 2861.43 crore. The rise in total expenditure figures can be attributed to employee benefit expense, outsourcing cost and travel and conveyance.

10. Innovation Labs: In a tweet the company said, HCL Technologies set up of six Innovation Labs during the quarter for designing new generation user-experience focused digital solutions.

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