Exhibit 99.1
IFRS-USD Press Release
Infosys Technologies (NASDAQ: INFY) Announces Results for the Quarter ended September 30, 2010
Q2 revenues grew by 29.6% year on year; sequentially grew by 10.2%
Bangalore, India – October 15, 2010
Highlights
Consolidated results under IFRS for the quarter ended September 30, 2010
“Though the economic environment continues to be challenging, we have leveraged our client relationships, solutions and investments to grow faster in this quarter,” said S. Gopalakrishnan, CEO and Managing Director. “There are significant drivers for investment in Information Technology since any transformation program to ‘build tomorrow’s enterprises’ requires these investments to be made. We are partnering with our clients on these initiatives.”
Business outlook
The company’s outlook (consolidated) for the quarter ending December 31, 2010 and for the fiscal year ending March 31, 2011, under International Financial Reporting Standards (IFRS), is as follows:
Outlook under IFRS – consolidated#
Quarter ending December 31, 2010
Revenues are expected to be in the range of $1,547 million and $1,562 million; YoY growth of 25.6% to 26.8%
Earnings per American Depositary Share(EPADS) is expected to be in the range of $0.66 and $0.67; YoY growth of 11.9% to 13.6%
Fiscal year ending March 31, 2011##
Revenues are expected to be in the range of $5.95 billion and $6.00 billion; YoY growth of 24.0% to 25.0%
Earnings per American Depositary Share(EPADS) is expected to be in the range of $2.54 and $2.58;YoY growth of 10.4% to 12.2%
| # | Exchange rates considered for major global currencies: AUD / USD – 0.97; GBP / USD – 1.58; Euro / USD – 1.36 |
| ## | Excluding the income from the sale of our investment in OnMobile Systems, Inc. of USD 11mn in fiscal 2010, the EPADS growth is expected to be in the range of 11.4% to 13.2% |
Expansion of services and significant projects
We continue to expand our offerings, enabling our clients’ transformations, managing their operations and accelerating their innovations. We invested in research in new lines of products and services which have been successfully adopted and implemented by our clients.
Transformation
Our solutions have been driving transformation for our existing and new clients, helping them streamline and diversify their businesses.
We are working with a global food and beverage major to enhance systems in their Product Lifecycle Management and Laboratory Information Management System applications. We are helping a Global 1000 CPG convenience foods company consolidate its intranet portals. We are also supporting the global product creation systems for a US-based sportswear and equipment major to help the client build next generation Product Lifecycle Management platforms. We were the sole sourced consultancy for improving quality management processes for the IT wing of a leading white goods company.
A leading manufacturer selected us as its partner to modernize its business systems by reducing complexity in process applications, minimizing costs and improving responsiveness. We are working with a major oilfield service provider, to develop and support technology products that will help oil and gas operators optimize production. We were selected by an international power company to work on its global financial consolidation project.
We are working with a publication house to transform its order management value chain to increase revenues and improve customer engagement. We defined the mobility roadmap for the US sales force of a leading agribusiness company to improve the client’s effectiveness and customer responsiveness. A global financial services company selected us to roll out a new broker / dealer platform for its client and advisor base.
Operations
We continue to successfully manage and meet our clients’ operational requirements, delivering higher returns on their investments.
We are working with the research and development team of a multinational computer manufacturer to develop processes and systems to manage software projects, resulting in efficiencies and cost savings. We are managing the flagship data center platforms and products for a leading US-based infrastructure management products company, enabling the client to focus on the development of next generation product platforms. We were chosen by a computer major to deliver next-generation software to manage servers and enable remote access services. We are helping a global consumer electronics company expand its retail supply chain platform to handle increased volumes and provide better service.
We delivered a program to optimize key business processes for an energy services provider in the US. A global oil and gas major selected us to set up and support a middleware infrastructure and integration layer that will integrate its trading applications. A global energy company selected us to implement a new automated SAP invoice payments system that would give it predictable flow of resources in business operations.
We are working with a leading aircraft manufacturer to customize its technical publication software to reduce turnaround time and effort. A large manufacturer of springs consulted us for its business intelligence and data warehousing consolidation. We are helping a major consumer packaging company to create a single globally integrated human resources information system. We were selected by a leader in the aerospace and defense sector to conceptualize and design a roadmap for its intranet and corporate communications.
Innovation
Our innovative prowess continues to gain favor with clients.
We are the strategic engineering partner of a leading network equipment company, helping develop its core software platform for next generation products. A US-based technology major engaged us to set up and execute a Center of Excellence focusing on quality assurance services for critical applications.
An aircraft equipment manufacturing major has solicited our help with aircraft wing structure and system integration design for a large new commercial aircraft program. We are carrying out the detailed design for a new commercial aircraft development program for a leading aerospace supplier. We are also providing post-design support for a large new aircraft program of a major aerospace supplier.
We have developed an innovative mobile navigation application for an online mapping service that has helped the client tap into a large mobile user base. A global bank has partnered with us to set up a Compliance Center of Excellence that will enhance its compliance bandwidth while rolling out new strategic programs. We are developing and deploying a mobile sales force enablement solution to enhance productivity for a global orthopedic solutions company. A large US utility is using our services to develop and deploy multiple Smart Grid initiatives that will reduce malfunctions and operational costs.
Liquidity
As on September 30, 2010, cash and cash equivalents, including investments in available-for-sale financial assets and certificates of deposits was $3.9 Bn( US $2.9 Bn as on September 30,2009)
“Our operating margins improved during the quarter while our liquidity position was further strengthened with cash and cash equivalents reaching US $3.9 billion,” said V. Balakrishnan, Chief Financial Officer. “However, the continued global economic uncertainty, coupled with extreme currency volatility, is a concern for the industry.”
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 1,22,000 employees in over 50 offices worldwide. Infosys is part of the NASDAQ-100 Index and The Global Dow. 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 o ur key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, 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, 2010 and on Form 6-K for the quarter ended June 30, 2010.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 comp any'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.
Contact
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Investor Relations | Avishek Lath, India +91 (80) 4116 7744 Avishek_lath@infosys.com | Sandeep Mahindroo, USA +1 (646) 254 3133 sandeep_mahindroo@infosys.com |
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| Media Relations | Sarah Vanita Gideon, India +91 (80) 4156 4998 Sarah_Gideon@infosys.com | Peter McLaughlin, USA +1 (213) 268 9363 Peter_McLaughlin@infosys.com |
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Unaudited Condensed Consolidated Interim Financial Statements prepared in compliance with IAS 34, Interim Financial Reporting
Infosys Technologies Limited and subsidiaries
| | (Dollars in millions except share data) |
| Unaudited Condensed Consolidated Balance Sheets as of | September 30, 2010 | March 31, 2010 |
| ASSETS | | |
| Current assets | | |
| Cash and cash equivalents | $3,427 | $2,698 |
| Available-for-sale financial assets | 8 | 569 |
| Investment in certificates of deposit | 434 | 265 |
| Trade receivables | 928 | 778 |
| Unbilled revenue | 235 | 187 |
| Derivative financial instruments | 4 | 21 |
| Prepayments and other current assets | 175 | 143 |
| Total current assets | 5,211 | 4,661 |
| Non-current assets | | |
| Property, plant and equipment | 1,008 | 989 |
| Goodwill | 183 | 183 |
| Intangible assets | 12 | 12 |
| Deferred income tax assets | 69 | 78 |
| Income tax assets | 143 | 148 |
| Other non-current assets | 116 | 77 |
| Total non-current assets | 1,531 | 1,487 |
| Total assets | $6,742 | $6,148 |
| LIABILITIES AND EQUITY | | |
| Current liabilities | | |
| Trade payables | $8 | $2 |
| Current income tax liabilities | 201 | 161 |
| Client deposits | 2 | 2 |
| Unearned revenue | 133 | 118 |
| Employee benefit obligations | 33 | 29 |
| Provisions | 18 | 18 |
| Other current liabilities | 430 | 380 |
| Total current liabilities | 825 | 710 |
| Non-current liabilities | | |
| Deferred income tax liabilities | 1 | 26 |
| Employee benefit obligations | 44 | 38 |
| Other non-current liabilities | 13 | 13 |
| Total liabilities | 883 | 787 |
| Equity | | |
Share capital- Rs. 5 ($0.16) par value 600,000,000 equity shares authorized, issued and outstanding 571,201,074 and 570,991,592, net of 2,833,600 treasury shares each as of September 30, 2010 and March 31, 2010, respectively | 64 | 64 |
| Share premium | 697 | 694 |
| Retained earnings | 5,096 | 4,611 |
| Other components of equity | 2 | (8) |
| Total equity attributable to equity holders of the company | 5,859 | 5,361 |
| Total liabilities and equity | $6,742 | $6,148 |
Infosys Technologies Limited and subsidiaries
Unaudited Condensed Consolidated Statements of Comprehensive Income
| | | (Dollars in millions except share data) |
| | Three months ended September 30, | Six months ended September 30, |
| | 2010 | 2009 | 2010 | 2009 |
| Revenues | $1,496 | $1,154 | $2,854 | $2,276 |
| Cost of sales | 855 | 662 | 1,655 | 1,305 |
| Gross profit | 641 | 492 | 1,199 | 971 |
| Operating expenses: | | | | |
| Selling and marketing expenses | 82 | 57 | 156 | 110 |
| Administrative expenses | 107 | 85 | 207 | 173 |
| Total operating expenses | 189 | 142 | 363 | 283 |
| Operating profit | 452 | 350 | 836 | 688 |
| Other income, net | 57 | 49 | 110 | 104 |
| Profit before income taxes | 509 | 399 | 946 | 792 |
| Income tax expense | 135 | 82 | 246 | 162 |
| Net profit | $374 | $317 | $700 | $630 |
| Other comprehensive income | | | | |
| Fair value changes on available-for-sale financial assets, net of tax effect | – | – | (1) | – |
| Exchange differences on translating foreign operations | 199 | $(10) | 11 | $226 |
| Total other comprehensive income | $199 | $(10) | $10 | $226 |
| Total comprehensive income | $573 | $307 | $710 | $856 |
| Profit attributable to: | | | | |
| Owners of the company | $374 | $317 | $700 | $630 |
| Non-controlling interest | – | – | – | – |
| | $374 | $317 | $700 | $630 |
| Total comprehensive income attributable to: | | | | |
| Owners of the company | $573 | $307 | $710 | $856 |
| Non-controlling interest | – | – | – | – |
| | $573 | $307 | $710 | $856 |
| Earnings per equity share | | | | |
| Basic ($) | 0.65 | 0.56 | 1.23 | 1.10 |
| Diluted ($) | 0.65 | 0.56 | 1.23 | 1.10 |
| Weighted average equity shares used in computing earnings per equity share | | | | |
| Basic | 571,131,367 | 570,343,178 | 571,083,717 | 570,229,204 |
| Diluted | 571,358,817 | 571,046,545 | 571,345,695 | 570,948,478 |
