Exhibit 99.2
Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
Q3 revenue grows by 49%
Revenue is expected to grow by 46% in fiscal 2005
Bangalore, India – January 12, 2005
Highlights
Consolidated results for the quarter ended December 31, 2004
| • | Income was Rs. 1,875.61 crore for the third quarter ended December 31, 2004; YoY growth of 49% |
| • | Net profit after tax was Rs. 497.34 crore for the third quarter ended December 31, 2004; YoY growth of 51% |
| • | Earnings per share from ordinary activities increased to Rs. 18.50 from Rs. 12.37* for the corresponding quarter in the previous year, an increase of 50% |
| • | 38 new clients were added during the quarter |
| • | Net addition of 2,280 employees for the quarter |
| • | 35,229 employees as on December 31, 2004 |
| * | adjusted for the 3:1 bonus issue of shares distributed on July 6, 2004 |
“We have seen another quarter of robust growth,” said Nandan M. Nilekani, CEO, President and Managing Director.“Infoscions have shown great energy and enthusiasm for all our new initiatives.”
Business outlook
The company’s outlook (consolidated) for the quarter and the fiscal year ending March 31, 2005, under Indian GAAP and US GAAP, is as follows:
Outlook under Indian GAAP – consolidated
Quarter ending March 31, 2005*
| • | Income is expected to be in the range of Rs. 1,956 crore and Rs. 1,964 crore; YoY growth of 45% |
| • | Earnings per share is expected to be Rs. 18.90; YoY growth of 50% |
| * | conversion 1 US$ = Rs. 43.27 |
Fiscal year ending March 31, 2005
| • | Income is expected to be in the range of Rs. 7,098 crore and Rs. 7,107 crore; growth of 46% |
| • | Earnings per share is expected to be Rs. 68.70; growth of 47% |
Outlook under US GAAP
Quarter ending March 31, 2005
| • | Consolidated revenues is expected to be in the range of $ 452 million to $ 454 million; YoY growth of 49% to 50% |
| • | Consolidated earnings per American Depositary Share is expected to be $ 0.44; YoY growth of 52% |
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Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
Fiscal year ending March 31, 2005
| • | Consolidated revenues is expected to be in the range of $ 1,589 million to $ 1,591 million; growth of 50% |
| • | Consolidated earnings per American Depositary Share is expected to be $ 1.53; growth of 49% |
“Our focus on creating synergies through Infosys Consulting and Progeon at either end of the services chain has enhanced our competitiveness,” said S. Gopalakrishnan, Member of the Board and COO.
Expansion of services and significant projects
Infosys and its subsidiaries added 38 clients during the quarter, taking the total number of active clients to 434 across the world.
Infosys made significant strides in the Automotive and Aerospace sectors during the quarter. TheAsian and North American divisions of a globally renowned automotive manufacturer began to engage with Infosys during the quarter. For the Asian division, Infosys is involved in developing a diagnostic data recorder, and for the North American division, Infosys assisted in automating a cost allocation process. Infosys continued its relationship witha global automotive manufacturer based in Europe, completing several ongoing projects in IT consulting and software development. During the quarter Infosys started working withan engineering design house in the USon a design project.
Large corporations in the Insurance and Healthcare industries are increasingly using the Infosys-pioneered Global Delivery Model to improve efficiency and customer focus. Infosys is working with apremier US-based wellness companyand aprovider of tools, applications and healthcare contentto analyse, design and implement new systems that strengthen their internal processes. In a mission-critical assignment, the most distinguishedpreferred provider organization (PPO) network in the USselected Infosys to rewrite its core system. Forone of the largest insurance companies in the US,Infosys developed an enterprise-wide road map for content management strategy. Other new wins this quarter includeone of the world’s fastest growing pharmaceutical companies and aclaim adjudication company.
In the Financial Services sector,a leading global bank continued its relationship with Infosys to leverage technology. Infosys worked with this client to develop and refine its IT integration strategy.
Infosys’ business solutions continued to enhance competitiveness for clients in the Retail industry. A USsupermarket giantused Infosys’ services to address process improvement initiatives and program management issues. Infosys also completed a large end-to-end business process re-engineering initiative for aleading corporation in the food distribution business. Apremier apparel marketer in the USpartnered with Infosys for a business consulting engagement.
Infosys strengthened its presence in the Hi-tech Manufacturing space by deepening its relationship with two significant clients – aworld leader in communications products and servicesand aglobally respected electronics manufacturing company.Infosys is working with both companies to revamp core processes and thereby improve their competitiveness.
In other major wins this quarter, a global leader inproduct safety and certification testing and a leadingglobal provider of information technology solutions for the air transport industry were added to Infosys’ client portfolio.
In China, Infosys started working witha recognised global leader in power and automation technologies to revamp its IT systems.
In Europe, anintegrated data services and technology providersigned up Infosys for assistance in developing software tools for its clients. In yet another win, a UK utilities businessengaged Infosys to convert its software platform.
“Demand for offshore outsourcing continued to be strong,” said Basab Pradhan, Head – Worldwide Sales and Senior Vice President.“Clients have responded favourably to the combination of our consulting services and offshore delivery.”
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Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
“Our growth has been well supported by our relentless pursuit of excellence, not only in our core client delivery processes but also in all the business enabling areas,” said S. D. Shibulal, Member of the Board and Head – World-wide Customer Delivery.
Banking Products
A reputed bank based in the United Arab Emirateshas selected Finacle®Universal Banking Solution to power its end-to-end banking requirements. The bank will deploy Finacle®core banking, treasury and e-banking solutions across 11 branches.A leading building society based in Zimbabwehas selected Finacle®Universal Banking Solution to deploy across its 52 branches. It will implement Finacle®core banking and treasury solutions.
In addition, during the quarter,a premier bank based in Taiwan went live on Finacle®core banking, CRM and consumer internet banking solutions.A leading Japanese bank also went live on upgraded versions of Finacle®treasury solution.
Liquidity and capital expenditure
Cash and cash equivalents, including investments in liquid mutual funds, increased by Rs. 236.26 crore during the quarter, from Rs. 2,502.07 crore to Rs. 2,738.33 crore, after incurring capital expenditure of Rs. 256.07 crore.
“We have been able to maintain our operating margins despite the appreciation of the rupee,” said T. V. Mohandas Pai, Member of the Board and Chief Financial Officer.
About the company
Infosys is a leading global technology services firm founded in 1981. Infosys provides end-to-end business solutions that leverage technology for its clients across the entire software life cycle: consulting, design, development, software re-engineering, maintenance, systems integration, package evaluation and implementation and infrastructure management services. In addition, Infosys offers software products to the banking industry, as well as business process management services through its majority-owned subsidiary, Progeon. For more information, contact V. Balakrishnan at +91 (80) 2852 0440 in India or visit us on the World Wide Web at www.infosys.com.
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Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
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 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, 2004 and on Form 6-K for the quarters ended June 30, 2004 and September 30, 2004 and Registration Statement on Form F-3 filed on December 20, 2004. 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.
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Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
INFOSYS TECHNOLOGIES LIMITED
| in Rs. crore | ||||||
Balance Sheet as at | December 31, 2004 | December 31, 2003 | March 31, 2004 | |||
SOURCES OF FUNDS | ||||||
SHAREHOLDERS’ FUNDS | ||||||
Share capital | 134.73 | 33.23 | 33.32 | |||
Reserves and surplus | 4,608.96 | 3,692.05 | 3,220.11 | |||
| 4,743.69 | 3,725.28 | 3,253.43 | ||||
APPLICATIONS OF FUNDS | ||||||
FIXED ASSETS | ||||||
Original cost | 2,093.07 | 1,481.83 | 1,570.23 | |||
Less: Depreciation and amortization | 951.39 | 744.99 | 803.41 | |||
Net book value | 1,141.68 | 736.84 | 766.82 | |||
Add: Capital work-in-progress | 212.14 | 79.38 | 203.48 | |||
| 1,353.82 | 816.22 | 970.30 | ||||
INVESTMENTS | 1,178.18 | 615.54 | 1,027.38 | |||
DEFERRED TAX ASSETS | 35.28 | 32.85 | 35.63 | |||
CURRENT ASSETS, LOANS AND ADVANCES | ||||||
Sundry debtors | 982.15 | 683.87 | 632.51 | |||
Cash and bank balances | 1,365.25 | 1,603.83 | 1,638.01 | |||
Loans and advances | 920.28 | 807.78 | 693.22 | |||
| 3,267.68 | 3,095.48 | 2,963.74 | ||||
LESS: CURRENT LIABILITIES AND PROVISIONS | ||||||
Current liabilities | 581.12 | 549.96 | 560.44 | |||
Provisions | 510.15 | 284.85 | 1,183.18 | |||
NET CURRENT ASSETS | 2,176.41 | 2,260.67 | 1,220.12 | |||
| 4,743.69 | 3,725.28 | 3,253.43 | ||||
NOTE:
The audited Balance Sheet as at December 31, 2004 has been taken on record at the board meeting held on January 12, 2005
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Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
INFOSYS TECHNOLOGIES LIMITED
| in Rs. crore, except per share data | ||||||||||||
Profit and Loss Account for the | Quarter ended December 31, | Nine months ended December 31, | Year ended March 31, | |||||||||
| 2004 | 2003 | 2004 | 2003 | 2004 | ||||||||
INCOME | ||||||||||||
Software services and products | ||||||||||||
Overseas | 1,758.87 | 1,227.30 | 4,865.56 | 3,401.93 | 4,694.69 | |||||||
Domestic | 39.65 | 7.96 | 93.91 | 50.06 | 66.20 | |||||||
| 1,798.52 | 1,235.26 | 4,959.47 | 3,451.99 | 4,760.89 | ||||||||
Software development expenses | 960.15 | 645.48 | 2,662.02 | 1,805.42 | 2,495.31 | |||||||
GROSS PROFIT | 838.37 | 589.78 | 2,297.45 | 1,646.57 | 2,265.58 | |||||||
Selling and marketing expenses | 101.32 | 92.35 | 291.79 | 252.51 | 335.08 | |||||||
General and administration expenses | 125.86 | 87.25 | 343.88 | 257.15 | 346.85 | |||||||
| 227.18 | 179.60 | 635.67 | 509.66 | 681.93 | ||||||||
OPERATING PROFIT BEFORE INTEREST, DEPRECIATION AND AMORTIZATION | 611.19 | 410.18 | 1,661.78 | 1,136.91 | 1,583.65 | |||||||
Interest | — | — | — | — | — | |||||||
Depreciation and amortization | 69.38 | 62.23 | 175.31 | 168.82 | 230.90 | |||||||
OPERATING PROFIT AFTER INTEREST, DEPRECIATION AND AMORTIZATION | 541.81 | 347.95 | 1,486.47 | 968.09 | 1,352.75 | |||||||
Other income | 46.77 | 47.48 | 94.99 | 124.21 | 127.39 | |||||||
Provision for investments | (0.39 | ) | 2.29 | (0.33 | ) | 8.88 | 9.67 | |||||
NET PROFIT BEFORE TAX | 588.97 | 393.14 | 1,581.79 | 1,083.42 | 1,470.47 | |||||||
Provision for taxation | 93.00 | 65.00 | 236.50 | 177.00 | 227.00 | |||||||
NET PROFIT AFTER TAX | 495.97 | 328.14 | 1,345.29 | 906.42 | 1,243.47 | |||||||
Balance brought forward | 763.81 | 469.88 | 70.51 | — | — | |||||||
Less: Residual dividend paid for Fiscal | ||||||||||||
2004 | — | — | 2.32 | — | — | |||||||
Dividend tax on the above | — | — | 2.27 | — | — | |||||||
| 763.81 | 469.88 | 65.92 | — | — | ||||||||
AMOUNT AVAILABLE FOR APPROPRIATION | 1,259.78 | 798.02 | 1,411.21 | 906.42 | 1,243.47 | |||||||
DIVIDEND | ||||||||||||
Interim | — | — | 133.93 | 96.09 | 96.09 | |||||||
Final | — | — | — | — | 99.96 | |||||||
One-time special dividend | — | — | — | — | 666.41 | |||||||
Total dividend | — | — | 133.93 | 96.09 | 862.46 | |||||||
Dividend tax | — | — | 17.50 | 12.31 | 110.50 | |||||||
Amount transferred – general reserve | — | — | — | — | 200.00 | |||||||
Balance in Profit and Loss account | 1,259.78 | 798.02 | 1,259.78 | 798.02 | 70.51 | |||||||
| 1,259.78 | 798.02 | 1,411.21 | 906.42 | 1,243.47 | ||||||||
EARNINGS PER SHARE* | ||||||||||||
Equity shares of par value Rs. 5/-each | ||||||||||||
Basic | 18.45 | 12.36 | 50.22 | 34.18 | 46.84 | |||||||
Diluted | 17.90 | 12.13 | 49.14 | 33.86 | 46.26 | |||||||
Number of shares used in computing | ||||||||||||
earnings per share | ||||||||||||
Basic | 26,87,73,742 | 26,55,19,448 | 26,78,62,078 | 26,51,76,084 | 26,54,47,776 | |||||||
Diluted | 27,71,10,460 | 27,04,31,572 | 27,37,70,692 | 26,77,16,272 | 26,87,87,016 | |||||||
| * | adjusted for the 3:1 bonus issue of shares distributed on July 6, 2004 |
NOTE:
The audited Profit and Loss Accounts for the quarter and nine months ended December 31, 2004 have been taken on record at the board meeting held on January 12, 2005
A Fact Sheet providing the operating metrics of the company can be downloaded from www.infosys.com
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Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
CONSOLIDATED FINANCIAL STATEMENTS OF INFOSYS TECHNOLOGIES LIMITED AND SUBSIDIARIES
| in Rs. crore | ||||||
Consolidated Balance Sheet as at | December 31, 2004 | December 31, 2003 | March 31, 2004 | |||
SOURCES OF FUNDS | ||||||
SHAREHOLDERS’ FUNDS | ||||||
Share capital | 134.74 | 33.23 | 33.32 | |||
Reserves and surplus | 4,592.39 | 3,690.87 | 3,216.26 | |||
| 4,727.13 | 3,724.10 | 3,249.58 | ||||
MINORITY INTERESTS | — | — | — | |||
PREFERENCE SHARES ISSUED BY SUBSIDIARY | 93.51 | 49.00 | 93.56 | |||
| 4,820.64 | 3,773.10 | 3,343.14 | ||||
APPLICATIONS OF FUNDS | ||||||
FIXED ASSETS | ||||||
Original cost | 2,187.23 | 1,499.00 | 1,633.65 | |||
Less: Depreciation and amortization | 969.52 | 749.88 | 809.84 | |||
Net book value | 1,217.71 | 749.12 | 823.81 | |||
Add: Capital work-in-progress | 213.44 | 80.47 | 208.05 | |||
| 1,431.15 | 829.59 | 1,031.86 | ||||
INVESTMENTS | 1,057.02 | 614.01 | 945.45 | |||
DEFERRED TAX ASSETS | 42.98 | 32.85 | 39.97 | |||
CURRENT ASSETS, LOANS AND ADVANCES | ||||||
Sundry debtors | 1,038.37 | 696.96 | 651.45 | |||
Cash and bank balances | 1,469.82 | 1,616.99 | 1,721.51 | |||
Loans and advances | 946.41 | 823.97 | 721.05 | |||
| 3,454.60 | 3,137.92 | 3,094.01 | ||||
LESS: CURRENT LIABILITIES AND PROVISIONS | ||||||
Current liabilities | 652.73 | 555.71 | 580.93 | |||
Provisions | 512.38 | 285.56 | 1,187.22 | |||
NET CURRENT ASSETS | 2,289.49 | 2,296.65 | 1,325.86 | |||
| 4,820.64 | 3,773.10 | 3,343.14 | ||||
Principles of consolidation: The financial statements are prepared in accordance with the principles and procedures for the preparation and presentation of consolidated financial statements as set out in the Accounting Standard on Consolidated Financial Statements prescribed by the Institute of Chartered Accountants of India. The financial statements of the parent company Infosys Technologies Limited (“Infosys” or “company”) and its subsidiaries have been combined on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances and transactions and resulting unrealised gains/ losses.
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Infosys Technologies Limited – Financial Release December 31, 2004 | Indian GAAP Press Release |
CONSOLIDATED FINANCIAL STATEMENTS OF INFOSYS TECHNOLOGIES LIMITED AND SUBSIDIARIES
| in Rs. crore, except per share data | ||||||||||||
Consolidated Profit and Loss Account for the | Quarter ended December 31, | Nine months ended December 31, | Year ended March 31, | |||||||||
| 2004 | 2003 | 2004 | 2003 | 2004 | ||||||||
INCOME | ||||||||||||
Software services, products and business process management | ||||||||||||
Overseas | 1,835.97 | 1,249.09 | 5,048.68 | 3,453.53 | 4,786.72 | |||||||
Domestic | 39.64 | 7.92 | 93.64 | 49.98 | 66.23 | |||||||
| 1,875.61 | 1,257.01 | 5,142.32 | 3,503.51 | 4,852.95 | ||||||||
Software development and business process management expenses | 991.48 | 656.70 | 2,723.35 | 1,831.58 | 2,538.67 | |||||||
GROSS PROFIT | 884.13 | 600.31 | 2,418.97 | 1,671.93 | 2,314.28 | |||||||
Selling and marketing expenses | 116.81 | 94.89 | 344.28 | 259.23 | 350.90 | |||||||
General and administration expenses | 149.34 | 92.33 | 406.39 | 267.66 | 369.19 | |||||||
| 266.15 | 187.22 | 750.67 | 526.89 | 720.09 | ||||||||
OPERATING PROFIT BEFORE INTEREST, DEPRECIATION & AMORTIZATION AND MINORITY INTERESTS | 617.98 | 413.09 | 1,668.30 | 1,145.04 | 1,594.19 | |||||||
Interest | — | — | — | — | — | |||||||
Depreciation and amortization | 73.91 | 63.75 | 187.11 | 172.32 | 236.73 | |||||||
OPERATING PROFIT AFTER INTEREST, DEPRECIATION & AMORTIZATION AND BEFORE MINORITY INTERESTS | 544.07 | 349.34 | 1,481.19 | 972.72 | 1,357.46 | |||||||
Other income | 46.31 | 46.46 | 91.61 | 121.56 | 123.38 | |||||||
Provision for investments | (0.39 | ) | 2.29 | (0.33 | ) | 8.88 | 9.67 | |||||
NET PROFIT BEFORE TAX AND MINORITY INTERESTS | 590.77 | 393.51 | 1,573.13 | 1,085.40 | 1,471.17 | |||||||
Provision for taxation | 93.43 | 65.00 | 240.10 | 177.00 | 227.54 | |||||||
NET PROFIT BEFORE MINORITY INTERESTS | 497.34 | 328.51 | 1,333.03 | 908.40 | 1,243.63 | |||||||
Minority interests | — | — | — | — | — | |||||||
NET PROFIT AFTER TAX AND MINORITY INTERESTS | 497.34 | 328.51 | 1,333.03 | 908.40 | 1,243.63 | |||||||
Balance brought forward | 750.35 | 471.49 | 70.67 | — | — | |||||||
Less: Residual dividend paid for Fiscal 2004 | — | — | 2.31 | — | — | |||||||
Dividend tax on the above | — | — | 2.27 | — | — | |||||||
| 750.35 | 471.49 | 66.09 | — | — | ||||||||
AMOUNT AVAILABLE FOR APPROPRIATION | 1,247.69 | 800.00 | 1,399.12 | 908.40 | 1,243.63 | |||||||
DIVIDEND | ||||||||||||
Interim | — | — | 133.93 | 96.09 | 96.09 | |||||||
Final | — | — | — | — | 99.96 | |||||||
One-time special dividend | — | — | — | — | 666.41 | |||||||
Total dividend | — | — | 133.93 | 96.09 | 862.46 | |||||||
Dividend tax | — | — | 17.50 | 12.31 | 110.50 | |||||||
Amount transferred – general reserve | — | — | — | — | 200.00 | |||||||
Balance in Profit and Loss account | 1,247.69 | 800.00 | 1,247.69 | 800.00 | 70.67 | |||||||
| 1,247.69 | 800.00 | 1,399.12 | 908.40 | 1,243.63 | ||||||||
EARNINGS PER SHARE * | ||||||||||||
Equity shares of par value Rs. 5/- each | ||||||||||||
Basic | 18.50 | 12.37 | 49.77 | 34.26 | 46.85 | |||||||
Diluted | 17.95 | 12.15 | 48.69 | 33.93 | 46.27 | |||||||
Number of shares used in computing earnings per share | ||||||||||||
Basic | 26,87,73,742 | 26,55,19,448 | 26,78,62,078 | 26,51,76,084 | 26,54,47,776 | |||||||
Diluted | 27,71,10,460 | 27,04,31,572 | 27,37,70,692 | 26,77,16,272 | 26,87,87,016 | |||||||
| * | adjusted for the 3:1 bonus issue of shares distributed on July 6, 2004 |
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