20:27:23 EDT Sun 13 Jun 2021
Enter Symbol
or Name
USA
CA



Login ID:
Password:
Save

Wipro Limited Announces Results for the Quarter Ended June 30, 2020 Under IFRS

2020-07-14 09:58 ET - News Release

IT Services Operating Margin3 for the quarter was at 19.0%

Earnings Per Share up by 5.7% YoY


Company Website: http://www.wipro.com/
BANGALORE, India & EAST BRUNSWICK, N.J. -- (Business Wire)

Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for the quarter ended June 30, 2020.

Highlights of the Results

Results for the Quarter ended June 30, 2020:

  • Gross Revenue was Rs 149.1 billion ($2.0 billion1), an increase of 1.3% YoY
  • IT Services Segment Revenue was at $1,921.6 million1, a decrease of 5.7% YoY
  • Non-GAAP2 constant currency IT Services Segment Revenue decreased by 4.4% YoY
  • IT Services Operating Margin3 for the quarter was at 19.0%, an expansion of 0.6% YoY
  • Net Income for the quarter was Rs 23.9 billion ($316.5 million1), an increase of 0.1% YoY
  • Earnings Per Share for the quarter was at Rs 4.20 ($0.061), an increase of 5.7% YoY
  • Operating Cash Flows was at Rs 41.8 billion ($553.6 million1), which is 174.9% of Net Income

Performance for the quarter ended June 30, 2020

Thierry Delaporte, CEO and Managing Director said, “I am deeply honored to lead Wipro, an extraordinary company and an exemplary corporate citizen with a deep technology heritage built on a strong foundation of values. I have great respect for the work done by the Azim Premji Foundation, its 67% economic ownership of Wipro adds greater meaning to what we do. Profitable growth will be the most important priority on my agenda. I am confident that we will be able to deliver long-term, sustainable growth in the interest of all our stakeholders.”

Jatin Dalal, Chief Financial Officer said, “We expanded the margins during the quarter, despite lower revenues, on the back of solid execution of several operational improvements and rupee depreciation. We also continued to sustain robust cash generation with Operating Cash Flows at 174.9% of Net income.”

IT Services

Wipro continued its momentum in winning large deals with our customers as described below:

  • Wipro has been selected by John Lewis Partnership, one of the UK’s leading retail groups, as a strategic partner to help drive its retail transformation agenda. As part of this, Wipro will deliver state-of-the-art technology infrastructure services, leveraging its capabilities in Cloud, Digital, Cyber Security, Wipro HOLMES™ our Artificial Intelligence (AI) and Automation Platform
  • Wipro has been awarded a strategic, multi-year infrastructure modernization and digital transformation services engagement by Germany-based energy company E.ON. Wipro will transform E.ON’s legacy data center operations to a hybrid cloud model by leveraging its strong energy value chain expertise in a prosumer driven world, Boundary Less Enterprise (BLE) framework and Wipro HOLMES™. Wipro’s consumption-based hybrid cloud hosting strategy will ensure a superior and secure customer environment spanning Perimeter & Endpoint security, threat detection & response, and Privileged Access Management (PAM)
  • Wipro has won a managed services contract from a multinational European automobile manufacturer to modernize and automate its engineering operations, leveraging Digital Rig, the client’s differentiated digital solution. With its strong domain expertise, globally-integrated delivery model and Wipro HOLMES™, Wipro will drive major transformations to enhance service quality and user experience
  • Wipro has won a strategic multi-year engagement with a leading global investment management firm to transform and manage its entire technology development services and infrastructure. The scope includes applications development and maintenance, quality engineering services, and infrastructure services comprising datacenter operations, networks, and service desk support. This contract adds to the operations engagement that the customer awarded Wipro last year. Wipro will leverage its strong digital expertise and hyper automation capabilities powered by Wipro HOLMES™ to transform the client’s application and infrastructure estate, driving additional synergies via an integrated technology-infrastructure-operations construct

Digital & Cloud Application Services Highlights

We continue to see increasing traction in digital oriented deals as illustrated below:

  • Wipro has secured a contract from a US-based food distribution company to deploy its CoTrack solution to meet the demands of the changing workplace due to the current pandemic. This wearable solution will enable the customer to maintain social distancing within the distribution center by sending real-time alerts in case of any violation. The solution will also enable contact tracing
  • Wipro has secured a strategic cloud contract from a food and beverage conglomerate to transform their operations and accelerate their digital journey, by improving agility, scalability and cost efficiencies. Wipro will strengthen advanced analytics capabilities to drive business value and offer analytical services to all entities within the organization
  • Wipro has won a digital engagement with a European health system to build and accelerate AI-powered applications and services, helping improve healthcare access and treatment for its patients
  • A US-based multinational conglomerate has selected Wipro to transform their Identity & Access Management services to meet the demands of the new normal. As part of the engagement, Wipro will enhance the customer’s current security environment and enable them to transition to the new solution
  • Wipro’s crowdsourcing platform Topcoder has won a data science challenge from the U.S. Bureau of Reclamation working with the NASA Tournament Lab. This challenge seeks to improve short-term streamflow forecasts via a year-long competition. Accurate stream flow forecasts enable efficient operation of water resource systems and may also be used as warning for floods. Participants will develop and implement their methods for locations across the western United States and attempt to outperform the current streamflow forecasts

Partner and Analyst Recognition

  • Wipro Limited has been recognized as the Application Innovation and Data Estate Modernization 2020 Microsoft Partner of the Year for our achievements in the Azure category
  • Wipro has been awarded the Storage Ecosystem Partner of the Year 2020 by Hewlett Packard Enterprise for storage solutions
  • Wipro was positioned as a Leader in IDC MarketScape EMEA Digital Transformation Service Providers for Oil and Gas Industry (Doc #EUR146159020, Apr 2020)
  • Wipro was positioned as a Leader in IDC MarketScape: Worldwide Cloud Professional Services 2020 Vendor Assessment (Doc #US45439120, Apr 2020)
  • Wipro was recognized as a Leader in Everest Group’s Internet of Things (IoT) Services PEAK Matrix® Assessment 2020
  • Wipro was recognized as a Leader in Everest Group’s Open Banking IT Services PEAK Matrix® Assessment 2020
  • Wipro was positioned as a Leader in Everest Group’s IT Security Services PEAK Matrix® Assessment 2020
  • Wipro was recognized as a Leader in Everest Group’s Healthcare Payer Operations – Services PEAK Matrix® Assessment 2020
  • Wipro was featured in HFS TOP 10 Salesforce services 2020
  • Wipro was positioned as a Leader in multiple quadrants in 2020 ISG Provider Lens™ Microsoft Ecosystem Report for USA and Germany
  • Wipro was positioned as a Leader in Gartner Magic Quadrant for Public Cloud Infrastructure Professional and Managed Services, Worldwide, Craig Lowery et al., 4 May 2020

Disclaimer: Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

State of IT Infrastructure 2020 Report

Wipro released its ‘State of IT Infrastructure 2020’ report which provides a multi-dimensional view of how the COVID-19 pandemic will impact IT infrastructure trends in the immediate future

IT Products

  • IT Products Segment Revenue for the quarter was Rs 2.3 billion ($29.9 million1)
  • IT Products Segment Results for the quarter was a profit of Rs 0.12 billion ($1.6 million1)

India business from State Run Enterprises (SRE)

  • India SRE Segment Revenue for the quarter was Rs 2.1 billion ($28.0 million1)
  • India SRE Segment Results for the quarter was a loss of Rs 0.10 billion ($1.3 million1)

Please refer to the table at the end for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.

About Non-GAAP Financial Measures

This press release contains non-GAAP financial measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. Such non-GAAP financial measures are measures of our historical or future performance, financial position or cash flows that are adjusted to exclude or include amounts that are excluded or included, as the case may be, from the most directly comparable financial measure calculated and presented in accordance with IFRS.

The table at the end provides IT Services Revenue on a constant currency basis, which is a non-GAAP financial measure that is calculated by translating IT Services Revenue from the current reporting period into U.S. dollars based on the currency conversion rate in effect for the prior reporting period. We refer to growth rates in constant currency so that business results may be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our business performance. Further, in the normal course of business, we may divest a portion of our business which may not be strategic. We refer to the growth rates in both reported and constant currency adjusting for such divestments in order to represent the comparable growth rates.

This non-GAAP financial measure is not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, the most directly comparable financial measure calculated in accordance with IFRS and may be different from non-GAAP measures used by other companies. In addition to this non-GAAP measure, the financial statements prepared in accordance with IFRS and the reconciliation of these non-GAAP financial measures with the most directly comparable IFRS financial measure should be carefully evaluated.

Results for the quarter ended June 30, 2020, prepared under IFRS, along with individual business segment reports, are available in the Investors section of our website www.wipro.com

Quarterly Conference Call

We will hold an earnings conference call today at 06:45 p.m. Indian Standard Time (09:15 a.m. U.S. Eastern Time) to discuss our performance for the quarter. The audio from the conference call will be available online through a web-cast and can be accessed at the following link- https://links.ccwebcast.com/?EventId=WIP200714

An audio recording of the management discussions and the question and answer session will be available online and will be accessible in the Investor Relations section of our website at www.wipro.com

About Wipro Limited

Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) is a leading global information technology, consulting and business process services company. We harness the power of cognitive computing, hyper-automation, robotics, cloud, analytics and emerging technologies to help our clients adapt to the digital world and make them successful. A company recognized globally for its comprehensive portfolio of services, strong commitment to sustainability and good corporate citizenship, we have over 180,000 dedicated employees serving clients across six continents. Together, we discover ideas and connect the dots to build a better and a bold new future.

Forward-Looking Statements

The forward-looking statements contained herein represent Wipro’s beliefs regarding future events, many of which are by their nature, inherently uncertain and outside Wipro’s control. Such statements include, but are not limited to, statements regarding Wipro’s growth prospects, its future financial operating results, and its plans, expectations and intentions. Wipro cautions readers that the forward-looking statements contained herein are subject to risks and uncertainties that could cause actual results to differ materially from the results anticipated by such statements. Such risks and uncertainties include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, revenue and profits, our ability to generate and manage growth, complete proposed corporate actions, intense competition in IT services, our ability to maintain 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, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which we make strategic investments, withdrawal of fiscal governmental incentives, political instability, war, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property and general economic conditions affecting our business and industry. The conditions caused by the COVID-19 pandemic could decrease technology spending, adversely affect demand for our products, affect the rate of customer spending and could adversely affect our customers’ ability or willingness to purchase our offerings, delay prospective customers’ purchasing decisions, adversely impact our ability to provide on-site consulting services and our inability to deliver our customers or delay the provisioning of our offerings, all of which could adversely affect our future sales, operating results and overall financial performance. Our operations may also be negatively affected by a range of external factors related to the COVID-19 pandemic that are not within our control.

Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission, including, but not limited to, Annual Reports on Form 20-F. These filings are available at www.sec.gov. We 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. We do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.

  1. For the convenience of the readers, the amounts in Indian Rupees in this release have been translated into United States Dollars at the certified foreign exchange rate of US$1 = Rs 75.53, as published by the Federal Reserve Board of Governors on June 30, 2020. However, the realized exchange rate in our IT Services business segment for the quarter ended June 30, 2020 was US$1= Rs 75.95
  2. Constant currency revenue for a period is the product of volumes in that period times the average actual exchange rate of the corresponding comparative period
  3. IT Services Operating Margin refers to Segment Results Total as reflected in IFRS financials

WIPRO LIMITED AND SUBSIDIARIES

INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(Rs in millions, except share and per share data, unless otherwise stated)

 

 

As at March 31, 2020

As at June 30, 2020

Convenience translation
into US dollar in millions
Refer footnote 1

ASSETS

 

Goodwill

 

131,012

131,596

1,742

Intangible assets

 

16,362

15,501

205

Property, plant and equipment

 

81,120

81,843

1,084

Right-of-Use assets

 

16,748

16,018

212

Financial assets

 

Investments

 

9,302

8,875

118

Trade receivables

 

6,049

6,047

80

Other financial assets

 

5,881

6,354

84

Investments accounted for using the equity method

 

1,383

1,412

19

Deferred tax assets

 

6,005

3,073

41

Non-current tax assets

 

11,414

11,821

157

Other non-current assets

 

11,935

11,457

152

Total non-current assets

 

297,211

293,997

3,894

Inventories

 

1,865

1,644

22

Financial assets

 

Derivative assets

 

3,025

1,666

22

Investments

 

189,635

213,865

2,832

Cash and cash equivalents

 

144,499

159,443

2,111

Trade receivables

 

104,474

93,023

1,232

Unbilled receivables

 

25,209

24,659

326

Other financial assets

 

8,614

10,526

139

Contract assets

 

17,143

16,301

216

Current tax assets

 

2,882

2,400

32

Other current assets

 

22,505

23,584

312

Total current assets

 

519,851

547,111

7,244

 

TOTAL ASSETS

 

817,062

841,108

11,138

 

EQUITY

 

Share capital

 

11,427

11,429

151

Share premium

 

1,275

1,568

21

Retained earnings

 

476,103

494,659

6,549

Share-based payment reserve

 

1,550

1,512

20

SEZ Re-investment reserve

 

43,804

49,234

652

Other components of equity

 

23,299

28,352

375

Equity attributable to the equity holders of the Company

 

557,458

586,754

7,768

Non-controlling interest

 

1,875

1,062

14

TOTAL EQUITY

 

559,333

587,816

7,782

 

LIABILITIES

 

Financial liabilities

 

Long - term loans and borrowings

 

4,840

4,747

63

Derivative liabilities

 

138

85

1

Lease liabilities

 

12,638

12,744

169

Other financial liabilities

 

151

192

3

Deferred tax liabilities

 

2,825

2,261

30

Non-current tax liabilities

 

13,205

13,060

173

Other non-current liabilities

 

7,537

8,293

110

Provisions

 

2

4

^

Total non-current liabilities

 

41,336

41,386

549

Financial liabilities

 

Loans, borrowings and bank overdrafts

 

73,202

69,490

920

Derivative liabilities

 

7,231

2,740

36

Trade payables and accrued expenses

 

78,129

75,057

995

Lease liabilities

 

6,560

7,080

94

Other financial liabilities

 

899

885

12

Contract liabilities

 

18,775

18,279

242

Current tax liabilities

 

11,731

13,970

185

Other current liabilities

 

19,254

23,546

312

Provisions

 

612

859

11

Total current liabilities

 

216,393

211,906

2,807

TOTAL LIABILITIES

 

257,729

253,292

3,356

 

TOTAL EQUITY AND LIABILITIES

 

817,062

841,108

11,138

^ Value is less than 1

 

 

WIPRO LIMITED AND SUBSIDIARIES

INTERIM CONDENSED CONSOLIDATED STATEMENT OF INCOME

(Rs in millions, except share and per share data, unless otherwise stated)

 

Three months ended June 30,

 

2019

2020

2020

 

Convenience translation
into US dollar in millions
Refer footnote 1

Revenues

 

147,161

149,131

1,974

Cost of revenues

 

(104,273)

(103,700)

(1,373)

Gross profit

 

42,888

45,431

601

 

Selling and marketing expenses

 

(10,953)

(9,789)

(130)

General and administrative expenses

 

(8,119)

(10,006)

(132)

Foreign exchange gains/(losses), net

 

858

1,205

16

Other operating income

 

699

97

1

Results from operating activities

 

25,373

26,938

356

 

Finance expenses

 

(1,584)

(1,299)

(17)

Finance and other income

 

6,947

5,281

70

Share of net profit /(loss) of associates accounted for using the equity method

 

(16)

31

^

Profit before tax

 

30,720

30,951

409

Income tax expense

 

(6,699)

(6,838)

(91)

Profit for the period

 

24,021

24,113

318

 

Profit attributable to:

 

Equity holders of the Company

 

23,874

23,902

315

Non-controlling interest

 

147

211

3

Profit for the period

 

24,021

24,113

318

 

Earnings per equity share:

 

Attributable to equity holders of the Company

 

Basic

 

3.97

4.20

0.06

Diluted

 

3.96

4.19

0.06

 

Weighted average number of equity shares

 

used in computing earnings per equity share

 

Basic

 

6,010,597,369

5,693,348,171

5,693,348,171

Diluted

 

6,025,352,442

5,703,168,248

5,703,168,248

^ Value is less than 1

 

 

Additional Information:

Particulars

Three months ended

Year ended

June 30,
2020

March 31,
2020

June 30,
2019

March 31,
2020

Audited

Audited

Audited

Audited

Revenue

IT Services

BFSI

44,828

46,690

45,395

184,457

Health BU

19,760

20,589

18,871

78,240

CBU

23,179

25,669

22,366

97,008

ENU

19,279

19,570

18,432

76,443

TECH

19,670

19,503

18,660

75,895

MFG

11,820

12,486

11,336

48,158

COMM

7,420

8,453

8,454

33,840

Total of IT Services

145,956

152,960

143,514

594,041

IT Products

2,258

2,792

2,409

11,010

ISRE

2,117

2,341

2,143

8,400

Reconciling Items

5

10

(47)

(50)

Total Revenue

150,336

158,103

148,019

613,401

 

Other operating Income

IT Services

97

395

699

1,144

Total Other Operating Income

97

395

699

1,144

 

Segment Result

IT Services

BFSI

8,517

8,144

9,335

34,132

Health BU

2,728

3,049

2,929

12,027

CBU

4,419

4,546

3,506

16,729

ENU

3,569

3,766

2,196

12,176

TECH

4,167

3,906

3,526

14,312

MFG

2,228

2,336

2,092

9,252

COMM

891

1,330

1,518

5,336

Unallocated

1,206

(547)

720

2,577

Other Operating Income

97

395

699

1,144

Total of IT Services

27,822

26,925

26,521

107,685

IT Products

124

116

(407)

(282)

ISRE

(100)

(481)

(636)

(1,822)

Reconciling Items

(908)

(171)

(105)

149

Total

26,938

26,389

25,373

105,730

Finance Expense

(1,299)

(1,653)

(1,584)

(7,328)

Finance and Other Income

5,281

4,907

6,947

24,081

Share of net profit/ (loss) of associates accounted for using the equity method

31

13

(16)

29

Profit before tax

30,951

29,656

30,720

122,512

The Company is organized into the following operating segments: IT Services, IT Products and India State Run Enterprise segment (ISRE).

IT Services: The IT Services segment primarily consists of IT Service offerings to customers organized by industry verticals.

The industry verticals are as follows: Banking, Financial Services and Insurance (BFSI), Health Business unit (Health BU), Consumer Business unit (CBU), Energy, Natural Resources & Utilities (ENU), Manufacturing (MFG), Technology (TECH) and Communications (COMM). Key service offerings to customers includes software application development and maintenance, research and development services for hardware and software design, business application services, analytics, consulting, infrastructure outsourcing services and business process services.

IT Products: The Company is a value-added reseller of desktops, servers, notebooks, storage products, networking solutions and packaged software for leading international brands. In certain total outsourcing contracts of the IT Services segment, the Company delivers hardware, software products and other related deliverables. Revenue relating to the above items is reported as revenue from the sale of IT Products.

India State Run Enterprise segment (ISRE): This segment consists of IT Services offerings to entities/ departments owned or controlled by the Government of India and/ or any State Governments.

Reconciliation of Non-GAAP Constant Currency IT Services Revenue to IT Services Revenue as per IFRS ($MN)

Three Months ended June 30, 2020

IT Services Revenue as per IFRS

$

1921.6

Effect of Foreign currency exchange movement

$

27.6

Non-GAAP Constant Currency IT Services Revenue based on exchange rates of comparable period in previous year

$

1949.2

 

Contacts:

Contact for Investor Relations
Aparna Iyer
Phone: +91-80-6142 7139
iyer.aparna@wipro.com

Abhishek Kumar Jain
Phone: +91-9845791363
abhishekkumar.jain@wipro.com

Contact for Media & Press
Vipin Nair
Phone: +91-80-6142 7139
vipin.nair1@wipro.com

Source: Wipro Limited

© 2021 Canjex Publishing Ltd. All rights reserved.