Infosys, India’s second largest IT services exporter on Friday reported a year-on-year rise of 13 per cent in consolidated net profit for the third quarter ended December 31, 2014. The company posted a net profit of Rs 3,250 crore as compared to Rs 2,875 crore in the corresponding period a year ago.
Infosys beat forecasts and maintained its sales growth outlook for the year, citing strong demand from clients in its largest market the United States. Many analysts had expected the company, which makes more than two-thirds of its sales from clients in the United States and Europe, to marginally cut its forecast of 7-9 per cent sales growth for the year ending in March 2015 due to currency fluctuations.
Infosys kept the outlook after it posted a higher-than-expected 13 per cent increase in net profit for the quarter ended December 31 on improved demand for outsourcing services.
Shares in Infosys extended their gains to as much as 6.9 percent after the results, while the main Mumbai market index was up nearly 0.1 per cent.
The revenues of Infosys for the quarter rose by 5.91% year-on-year.The company reported a revenue of Rs 13,796 crore as compared to Rs 13,026 crore in the corresponding period a year ago. Sequentially, the company’s net profit increased 4.91 per cent while revenue rose 3.4 per cent.
The company, meanwhile, kept its FY 15 dollar revenue guidance unchanged at 7-9 per cent.
“We are excited by several breakthrough results in Q3. Our “renew and new” strategy, is being received well by our clients and our ecosystem and we are already seeing its early adoption”, said Vishal Sikka, CEO and Managing Director, Infosys. “Based on our strong performance, we are intensifying our efforts to deepen employee engagement, client ecosystem and strengthen our foundation of education as we build a next generation services company that innovates for consistent profitable growth.”
Infosys said the quarter witnessed the highest employee utilisation rates in 11 years while the sequential volume growth of 4.2% was the best in 3 years. The company and its subsidiaries added 59 clients during the quarter.
“During the quarter, we saw broad-based volume growth, increased utilization and strong client additions,” said U B Pravin Rao, Chief Operating Officer. “We have made 100% variable payout for Q3 and have seen a further decline in attrition as a result of multiple initiatives taken over the last few quarters.”
“Our sequential revenue growth in Q3 was adversely impacted to the extent of 1.8% due to USD appreciation against other major currencies”, said Rajiv Bansal, Chief Financial Officer. “We made required investments keeping in mind short-term priorities and long-term aspirations.”
Infosys shares were trading at Rs 2087.2, up by 5.71 per cent on the Bombay Stock Exchange at around 1.06 pm on Friday. (With Reuters inputs)