EXHIBIT 99.1
US GAAP Press Release
Infosys Technologies (NASDAQ: INFY) Announces Results for the Quarter ended June 30, 2008
Q1 revenues grew by 24.5% year on year; sequential growth 1.1%
Bangalore, India – July 11, 2008
Highlights
Consolidated results for the quarter ended June 30, 2008
- First quarter revenues at $ 1,155 million, up 24.5% from the corresponding quarter last fiscal
- Earnings per American Depositary Share (ADS)* increased to $ 0.54 from $ 0.46 in the corresponding quarter last fiscal; YoY growth was 17.4%
- 49 new clients were added during the quarter by Infosys and its subsidiaries
- Gross addition of 7,182 employees (net 3,192) for the quarter by Infosys and its subsidiaries
- 94,379 employees as on June 30, 2008 for Infosys and its subsidiaries
*The tax provision for quarters ended June 30, 2008 and June 30, 2007 includes a tax reversal of $ 7 million and $ 13 million respectively. Excluding this reversal, the earnings per share for the quarters ended June 30, 2008 and June 30, 2007 would have been $ 0.53 and $ 0.44 respectively, resulting in a YOY growth of 20.5%
Outlook for the quarter ending September 30, 2008 and the fiscal year ending March 31, 2009
Quarter ending September 30, 2008
- Consolidated revenues are expected to be in the range of $ 1,215 million and $ 1,225 million; YoY growth of 18.9% – 19.9%
- Consolidated earnings per American Depositary Share are expected to be in the range of $ 0.55 and $ 0.56; YoY growth of 14.6% – 16.7%
Fiscal year ending March 31, 2009
- Consolidated revenues are expected to be in the range of $ 4.97 billion and $ 5.05 billion; YoY growth of 19.0% – 21.0%
- Consolidated earnings per American Depositary Share** are expected to be between $ 2.32 and
$ 2.36; YoY growth of 14.3% – 16.3%
** Including tax reversal of $ 7 million in fiscal 2009 and $ 30 million in fiscal 2008 respectively. Excluding the tax reversal, the earnings per share are expected to be between $ 2.31 and $ 2.35 for the year ending March 31, 2009; YoY growth of 16.7% – 18.7%
“Although the global economic environment continues to remain uncertain and could impact IT spending in the short term, we see several opportunities for growth as customers relentlessly focus on improving efficiency,” said S. Gopalakrishnan, CEO and Managing Director.
Expansion of services and significant projects
Businesses across the world continued to benefit from Infosys’ services and solutions. A special competency group devoted to developing specialized products has been set up to enhance the business value provided to Infosys’ customers and support them on their transformational journey.
An automotive OEM is using Infosys’ engineering services to develop seating systems. A high-tech company has approached Infosys to develop its competitive strategy and transformation roadmap. An auto financier has engaged Infosys to develop its online dealer marketplace. A global auto manufacturer in India has signed up Infosys to develop a transport management system. Infosys is executing a Business Intelligence solution for a high-tech leader. A software major has sought Infosys’ expertise to design a campaign management platform. A high-tech manufacturer in South East Asia has turned to Infosys to implement a Siebel marketing campaign and analytics platform. Another high-tech company has sought Infosys’ help to improve its customer experience by constructing a customer portal and putting in place a governance structure t o strengthen customer operations.
An insurance major has partnered with Infosys to test interactive voice response (IVR) and speech applications.
Infosys is assisting a global bank to assess its enterprise architecture and rationalize its application portfolio. A financial product technology provider has sought Infosys’ expertise in developing an analytic tool.
Infosys continued to make inroads in emerging economies. A leading bank in the Middle East has engaged Infosys to implement CRM across its retail banking business. A media company in Australia has sought Infosys’ expertise to define its solutions. As part of the engagement, Infosys modified its delivery structure to mitigate risks in delivery and schedule.
Demand for Infosys’ consulting services continued to be strong with market leaders. A high-tech manufacturer has approached Infosys to create an Oracle-enabled business solution supporting rapid time-to-market, strategic expansion and a new business model. An agribusiness has selected Infosys to deliver a global program that includes redesign of the operations of its seeds business.
“Margins for the quarter were impacted due to increases in salary and visa costs which to some extent were offset by rupee depreciation,” said V. Balakrishnan, Chief Financial Officer. “We believe that the currency market will remain volatile in the short term.”
About Infosys Technologies Ltd.
Infosys (NASDAQ: INFY) defines, designs and delivers IT-enabled business solutions that help Global 2000 companies win in a Flat World. These solutions focus on providing strategic differentiation and operational superiority to clients. With Infosys, clients are assured of a transparent business partner, world-class processes, speed of execution and the power to stretch their IT budget by leveraging the Global Delivery Model that Infosys pioneered. Infosys has over 94,000 employees in over 40 offices worldwide. Infosys is part of the NASDAQ-100 Index. For more information, visit www.infosys.com.
Safe Harbor
Certain statements in this release concerning our future growth prospects are forward-looking statements, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT services including those factors which may affect 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, industry segment concentration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acqui sitions, liability for damages on our service contracts, the success of the companies in which Infosys has made strategic investments, withdrawal of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our Annual Report on Form 20-F for the fiscal year ended March 31, 2008. These filings are available at www.sec.gov. Infosys 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. The company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the company.
ContactInvestor Relations | Shekar Narayanan, India
+91 (80) 4116 7744
shekarn@infosys.com | Sandeep Mahindroo, USA
+1 (646) 254 3133
sandeep_mahindroo@infosys.com |
Media Relations | Bani Paintal Dhawan, India
+91 (80) 2852 2408
Bani_Dhawan@infosys.com | Peter Mclaughlin, USA
+1 (213) 268 9363
Peter_Mclaughlin@infosys.com |
Infosys Technologies Limited and subsidiaries
Consolidated Balance Sheets
(Dollars in millions)
| As of |
| March 31, 2008 | June 30, 2008 |
| (1) | (Unaudited) |
Assets | | |
Current assets | | |
Cash and cash equivalents | $ 2,058 | $ 1,722 |
Investments in liquid mutual fund units | 18 | 35 |
Trade accounts receivable, net of allowances | 824 | 775 |
Unbilled revenue | 120 | 163 |
Prepaid expenses and other current assets | 107 | 136 |
Deferred tax assets | 2 | 9 |
Total current assets | 3,129 | 2,840 |
Property, plant and equipment, net | 1,022 | 990 |
Goodwill | 150 | 141 |
Intangible assets, net | 25 | 25 |
Deferred tax assets | 66 | 70 |
Advance income taxes | 55 | 32 |
Other assets | 45 | 46 |
Total assets | $ 4,492 | $ 4,144 |
Liabilities and stockholders’ equity | | |
Current liabilities | | |
Accounts payable | $12 | $4 |
Income taxes payable | 101 | 111 |
Client deposits | 1 | 3 |
Unearned revenue | 71 | 91 |
Other current liabilities | 386 | 397 |
Total current liabilities | 571 | 606 |
Non-current liabilities | | |
Other non-current liabilities | 11 | 11 |
Stockholders’ equity | | |
Common stock, Rs. 5 ($ 0.16) par value 600,000,000 equity shares authorized, issued and outstanding – 571,995,758 and 572,343,176 as of March 31, 2008 and June 30, 2008 respectively | 64 | 64 |
Additional paid-in capital | 718 | 725 |
Accumulated other comprehensive income | 311 | 39 |
Retained earnings | 2,817 | 2,699 |
Total stockholders’ equity | 3,910 | 3,527 |
Total liabilities and stockholders’ equity | $ 4,492 | $ 4,144 |
(1) March 31, 2008 balances were obtained from audited financial statements
Unaudited Consolidated Statements of Income
(Dollars in millions except per share data)
| Three months ended June 30, |
| 2007 | 2008 |
Revenues | $ 928 | $ 1155 |
Cost of revenues | 569 | 697 |
Gross profit | 359 | 458 |
Operating expenses: | | |
Selling and marketing expenses | 51 | 61 |
General and administrative expenses | 77 | 87 |
Amortization of intangible assets | 2 | 2 |
Total operating expenses | 130 | 150 |
Operating income | 229 | 308 |
Other income, net | 62 | 28 |
Income before income taxes and minority interest | 291 | 336 |
Provision for income taxes | 28 | 30 |
Income before minority interest | $ 263 | $ 306 |
Minority interest | - | - |
Net income | $ 263 | $ 306 |
Earnings per equity share | | |
Basic | $ 0.46 | $ 0.54 |
Diluted | $ 0.46 | $ 0.54 |
Weighted-average equity shares used in computing earnings per equity share | | |
Basic | 568,376,262 | 569,365,847 |
Diluted | 570,506,394 | 570,479,751 |
