Result announcement by the company: Bangalore based leading software company, Wipro, declared its financial results today for the first quarter of the FY12. It reported a rise in net profit to Rs 1,335 crore in June from Rs 1,319 crore corresponding quarter previous year under international accounting standards.
Wipro is global information technology company, which is also listed on New York Stock Exchange (NYSE), apart from BSE and NSE. The company operates in three segments: IT Services, IT Products, Consumer Care and Lighting and it provides outsourced research and development, infrastructure outsourcing, business process outsourcing (BPO) and business consulting services.
It's total revenues increased by 3% to Rs 8564 crore from Rs 8,302.4 crore quarter-on-quarter (Q-o-Q) basis.
Its global IT services revenues increased 1.8% to Rs 6,405 crore from Rs 6,289 crore Q-o-Q basis.
Company reported net income of Rs 1,318 crore.
In January, Wipro reorganized its key IT outsourcing business in an effort to win more clients, and soon after it removed the joint chiefs of the business and elected T. K. Kurien as the new chief executive. Kurien aims to aid sales by expanding operations through overseas acquisitions and reorganizing the business.
Azim Premji, Chairman of Wipro said, “We are seeing early signs of positive momentum after the re-organization. Clients continue to focus on optimizing operations, creating new products and getting access to newer markets. We will continue to make investments that bring superior value to our clients as they try to win in this market."
Company added 49 new customers for the quarter and increased the workforce by 4,105 people.
Revenue growth from March 2011 Quarter to June 2011 quarter was slow. While Wipro registered an increase of only 1.85%, which was less than TCS (8.08%) and Infosys (3.55%).
Comparatively Wipro managed to keep its expenses under check quarter-on-quarter (q-o-q), it saw an increament of 2.9% in June 2011 quarter over the March 2011 quarter, compared to 10.92% of TCS and 8.10% of Infosys.
Also the companies interest payment increased from Rs 31.4 crore in March 2011 quarter to Rs 78.9 crore in June 2011 quarter.
Net profit too decreased on a q-o-q basis by 8.84%, which is huge disappointment compared to the TCS and Infosys as each saw the net profit decline by only 4.04% and 4.39% respectively for the same period.
The companies net profit margins have declined by nearly 2 percentage points compared to last quarter (percentage points example – change from 2% to 3% is change of 1 percentage points).
(All data for the 'Analysis' has been taken from BSE website)