IT Services delivers strong revenue growth for the quarter at 27.5% YoY, IT Services Segment Margins at 17.6%
BANGALORE, India & NEW YORK–(BUSINESS WIRE)–#Digital–Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for the Quarter ended December 31, 2021.
Highlights of the Results
Results for the Quarter ended December 31, 2021:
Performance for the quarter ended December 31, 2021
Thierry Delaporte, CEO and Managing Director, said, �Wipro has delivered a fifth consecutive quarter of strong performance, both on revenues, and margins. Order bookings have been strong too, and we have added seven new customers in the more than $100 Mn revenue league, in the last 12 months. Our strategy and improved execution continue to serve us well, and we are confident of building on this momentum. We are also excited to have completed the acquisitions of Edgile and LeanSwift Solutions in the quarter, both of which will add to our capabilities significantly.
Jatin Dalal, Chief Financial Officer, said, We delivered robust operating margins after absorbing substantial investments on salary increases, owing to continued improvement in operating metrics. We also improved our working capital, by reducing our Days Sales Outstanding. This has resulted in strong operating cash flow conversion, of 101.3% of net income. Additionally, we have declared an interim dividend of Rs 1 per equity share.
Outlook for the quarter ending March 31, 2022
We expect Revenue from our IT Services business to be in the range of $2,692 million to $2,745 million*. This translates to a sequential growth of 2.0% to 4.0%.
*Outlook is based on the following exchange rates: GBP/USD at 1.34, Euro/USD at 1.13, AUD/USD at 0.73, USD/INR at 75.73 and CAD/USD at 0.79
IT Services
Wipro continued its momentum in winning large deals with our customers as described below:
Digital Services Highlights
We continue to see increasing traction in digital oriented and other strategic deals as illustrated below:
Analyst Recognition
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IT Products
India business from State Run Enterprises (ISRE)
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 December 31, 2021, 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 07:15 p.m. Indian Standard Time (08:45 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=WIP20220112
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 220,000 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 Wipros beliefs regarding future events, many of which are by their nature, inherently uncertain and outside Wipros control. Such statements include, but are not limited to, statements regarding Wipros 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.
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 companys 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.
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, 2021 | As at December 31, 2021 | ||||
|
Convenience translation | ||||||
ASSETS |
| ||||||
Goodwill |
| 139,127 | 242,945 | 3,266 | |||
Intangible assets |
| 13,085 | 44,320 | 596 | |||
Property, plant and equipment |
| 85,192 | 90,248 | 1,213 | |||
Right-of-Use assets |
| 16,420 | 18,445 | 248 | |||
Financial assets |
| ||||||
Derivative assets |
| 16 | 35 | ^ | |||
Investments |
| 10,576 | 17,543 | 236 | |||
Trade receivables |
| 4,358 | 1,301 | 17 | |||
Other financial assets |
| 6,088 | 6,052 | 81 | |||
Investments accounted for using the equity method |
| 1,464 | 775 | 10 | |||
Deferred tax assets |
| 1,664 | 2,357 | 32 | |||
Non-current tax assets |
| 14,323 | 10,222 | 137 | |||
Other non-current assets |
| 15,935 | 12,377 | 166 | |||
Total non-current assets |
| 308,248 | 446,620 | 6,002 | |||
Inventories |
| 1,064 | 1,025 | 14 | |||
Financial assets |
| ||||||
Derivative assets |
| 4,064 | 5,277 | 71 | |||
Investments |
| 175,707 | 235,740 | 3,169 | |||
Cash and cash equivalents |
| 169,793 | 107,458 | 1,445 | |||
Trade receivables |
| 94,298 | 122,365 | 1,645 | |||
Unbilled receivables |
| 27,124 | 38,908 | 523 | |||
Other financial assets |
| 7,245 | 9,608 | 129 | |||
Contract assets |
| 16,507 | 16,680 | 224 | |||
Current tax assets |
| 2,461 | 4,185 | 56 | |||
Other current assets |
| 24,923 | 29,504 | 397 | |||
Total current assets |
| 523,186 | 570,750 | 7,673 | |||
| |||||||
TOTAL ASSETS |
| 831,434 | 1,017,370 | 13,675 | |||
| |||||||
EQUITY |
| ||||||
Share capital |
| 10,958 | 10,962 | 147 | |||
Share premium |
| 714 | 1,304 | 18 | |||
Retained earnings |
| 466,692 | 555,789 | 7,471 | |||
Share-based payment reserve |
| 3,071 | 4,094 | 55 | |||
SEZ Re-investment reserve |
| 41,154 | 44,167 | 594 | |||
Other components of equity |
| 30,506 | 37,609 | 506 | |||
Equity attributable to the equity holders of the Company |
| 553,095 | 653,925 | 8,791 | |||
Non-controlling interests |
| 1,498 | 446 | 6 | |||
TOTAL EQUITY |
| 554,593 | 654,371 | 8,797 | |||
| |||||||
LIABILITIES |
| ||||||
Financial liabilities |
| ||||||
Loans and borrowings |
| 7,458 | 55,417 | 745 | |||
Derivative liabilities |
| – | 1 | ^ | |||
Lease liabilities |
| 13,513 | 15,056 | 202 | |||
Other financial liabilities |
| 2,291 | 3,676 | 49 | |||
Deferred tax liabilities |
| 4,633 | 14,989 | 201 | |||
Non-current tax liabilities |
| 11,069 | 14,520 | 195 | |||
Other non-current liabilities |
| 7,835 | 8,238 | 111 | |||
Provisions |
| 2 | 6 | ^ | |||
Total non-current liabilities |
| 46,801 | 111,903 | 1,503 | |||
Financial liabilities |
| ||||||
Loans, borrowings and bank overdrafts |
| 75,874 | 78,501 | 1,055 | |||
Derivative liabilities |
| 1,070 | 340 | 5 | |||
Trade payables and accrued expenses |
| 78,870 | 87,506 | 1,175 | |||
Lease liabilities |
| 7,669 | 8,647 | 116 | |||
Other financial liabilities |
| 1,470 | 3,906 | 53 | |||
Contract liabilities |
| 22,535 | 28,161 | 379 | |||
Current tax liabilities |
| 17,324 | 18,992 | 255 | |||
Other current liabilities |
| 24,552 | 24,238 | 326 | |||
Provisions |
| 676 | 805 | 11 | |||
Total current liabilities |
| 230,040 | 251,096 | 3,375 | |||
TOTAL LIABILITIES | 276,841 | 362,999 | 4,878 | ||||
TOTAL EQUITY AND LIABILITIES | 831,434 | 1,017,370 | 13,675 | ||||
^ 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 December 31, | Nine months ended December 31, | |||||||||||||||||
| 2020 | 2021 | 2021 | 2020 | 2021 | 2021 | ||||||||||||
|
Convenience Refer footnote 1 |
Convenience Refer footnote 1 | ||||||||||||||||
Revenues |
| 156,700 | 203,136 | 2,731 | 456,976 | 582,334 | 7,828 | |||||||||||
Cost of revenues |
| (104,313) | (142,778) | (1,919) | (313,400) | (407,907) | (5,483) | |||||||||||
Gross profit |
| 52,387 | 60,358 | 812 | 143,576 | 174,427 | 2,345 | |||||||||||
| ||||||||||||||||||
Selling and marketing expenses |
| (11,326) | (13,988) | (189) | (30,721) | (40,857) | (549) | |||||||||||
General and administrative expenses |
| (7,814) | (12,036) | (162) | (25,997) | (33,854) | (455) | |||||||||||
Foreign exchange gains/(losses), net |
| 566 | 1,187 | 16 | 2,109 | 3,280 | 44 | |||||||||||
Other operating income/(loss), net |
| – | 14 | ^ | (81) | 2,179 | 29 | |||||||||||
Results from operating activities |
| 33,813 | 35,535 | 477 | 88,886 | 105,175 | 1,414 | |||||||||||
| ||||||||||||||||||
Finance expenses |
| (1,400) | (1,403) | (19) | (3,966) | (3,608) | (49) | |||||||||||
Finance and other income |
| 5,975 | 3,578 | 48 | 16,465 | 12,311 | 165 | |||||||||||
Share of net profit/ (loss) of associates accounted |
| 101 | 76 | 1 | 126 | 73 | 1 | |||||||||||
Profit before tax |
| 38,489 | 37,786 | 507 | 101,511 | 113,951 | 1,531 | |||||||||||
Income tax expense |
| (8,524) | (8,063) | (108) | (22,590) | (22,547) | (303) | |||||||||||
Profit for the period |
| 29,965 | 29,723 | 399 | 78,921 | 91,404 | 1,228 | |||||||||||
| ||||||||||||||||||
Profit attributable to: |
| |||||||||||||||||
Equity holders of the Company |
| 29,667 | 29,690 | 399 | 78,225 | 91,318 | 1,227 | |||||||||||
Non-controlling interests |
| 298 | 33 | ^ | 696 | 86 | 1 | |||||||||||
Profit for the period |
| 29,965 | 29,723 | 399 | 78,921 | 91,404 | 1,228 | |||||||||||
| ||||||||||||||||||
Earnings per equity share: |
| |||||||||||||||||
Attributable to equity holders of the Company |
| |||||||||||||||||
Basic | 5.21 | 5.43 | 0.07 | 13.74 | 16.71 | 0.22 | ||||||||||||
Diluted | 5.17 | 5.42 | 0.07 | 13.46 | 16.67 | 0.22 | ||||||||||||
Weighted average number of equity shares | ||||||||||||||||||
used in computing earnings per equity share | ||||||||||||||||||
Basic | 5,696,798,493 | 5,467,954,878 | 5,467,954,878 | 5,694,731,405 | 5,465,359,077 | 5,465,359,077 | ||||||||||||
Diluted | 5,741,070,466 | 5,481,204,821 | 5,481,204,821 | 5,812,779,105 | 5,478,766,612 | 5,478,766,612 | ||||||||||||
^ Value is less than 1 |
Additional Information:
Particulars | Three months ended | Nine months ended | Year ended | |||
December |
September |
December |
December |
December |
March | |
Audited | Audited | Audited | Audited | Audited | Audited | |
Revenue | ||||||
IT Services | ||||||
Americas 1 | 56,644 | 53,205 | 45,015 | 159,532 | 131,581 | 178,091 |
Americas 2 | 61,076 | 59,260 | 44,702 | 175,441 | 133,346 | 179,821 |
Europe | 59,620 | 58,619 | 42,880 | 172,700 | 120,334 | 165,441 |
APMEA | 23,596 | 22,715 | 20,717 | 67,543 | 61,637 | 82,462 |
Total of IT Services | 200,936 | 193,799 | 153,314 | 575,216 | 446,898 | 605,815 |
IT Products | 1,767 | 1,894 | 1,563 | 4,972 | 5,568 | 7,685 |
ISRE | 1,623 | 1,867 | 2,388 | 5,427 | 6,610 | 8,912 |
Reconciling Items | (3) | 47 | 1 | (1) | 9 | 13 |
Total Revenue | 204,323 | 197,607 | 157,266 | 585,614 | 459,085 | 622,425 |
Other operating income/(loss), net | ||||||
IT Services | 14 | 15 | – | 2,179 | (81) | (81) |
Total Other operating income/(loss), net | 14 | 15 | – | 2,179 | (81) | (81) |
Segment Result | ||||||
IT Services | ||||||
Americas 1 | 11,390 | 10,521 | 8,075 | 31,290 | 23,177 | 33,040 |
Americas 2 | 12,057 | 11,819 | 10,190 | 35,226 | 31,089 | 41,589 |
Europe | 9,172 | 9,186 | 9,283 | 26,683 | 22,969 | 31,673 |
APMEA | 2,483 | 3,028 | 2,778 | 8,577 | 8,402 | 11,476 |
Unallocated | 173 | (156) | 2,945 | 73 | 3,896 | 5,153 |
Other operating income/(loss), net | 14 | 15 | – | 2,179 | (81) | (81) |
Total of IT Services | 35,289 | 34,413 | 33,271 | 104,028 | 89,452 | 122,850 |
IT Products | 96 | 94 | 78 | 137 | (100) | 45 |
ISRE | 134 | 393 | 471 | 1,002 | 474 | 1,061 |
Reconciling Items | 16 | 20 | (7) | 8 | (940) | (903) |
Total | 35,535 | 34,920 | 33,813 | 105,175 | 88,886 | 123,053 |
Finance expenses | (1,403) | (1,459) | (1,400) | (3,608) | (3,966) | (5,088) |
Finance and Other Income | 3,578 | 4,114 | 5,975 | 12,311 | 16,465 | 20,912 |
Share of net profit/ (loss) of associates | 76 | (10) | 101 | 73 | 126 | 130 |
Profit before tax | 37,786 | 37,565 | 38,489 | 113,951 | 101,511 | 139,007 |
The Company is organized into the following operating segments: IT Services, IT Products and India State Run Enterprise segment (ISRE).
IT Services: As announced on November 12, 2020, effective January 1, 2021, the Company re-organized IT Services segment to four Strategic Market Units (SMUs) – Americas 1, Americas 2, Europe and Asia Pacific Middle East Africa (APMEA).
Americas 1 and Americas 2 are primarily organized by industry sector, while Europe and APMEA are organized by countries.
Americas 1 includes Healthcare and Medical Devices, Consumer Goods and Lifesciences, Retail, Transportation and Services, Communications, Media and Information services, Technology Products and Platforms, in the United States of America and entire business of Latin America (LATAM”). Americas 2 includes Banking, Financial Services and Insurance, Manufacturing, Hi-tech, Energy and Utilities industry sectors in the United States of America and entire business of Canada. Europe consists of United Kingdom and Ireland, Switzerland, Germany, Benelux, Nordics and Southern Europe. APMEA consists of Australia and New Zealand, India, Middle East, South East Asia, Japan and Africa.
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 December 31, 2021 |
| |||
IT Services Revenue as per IFRS | $ | 2,639.7 | ||
Effect of Foreign currency exchange movement | $ | 17.2 | ||
Non-GAAP Constant Currency IT Services Revenue based on | $ | 2,656.9 | ||
previous quarter exchange rates |
| |||
|
| |||
Three Months ended December 31, 2021 |
| |||
IT Services Revenue as per IFRS | $ | 2,639.7 | ||
Effect of Foreign currency exchange movement | $ | 21.2 | ||
Non-GAAP Constant Currency IT Services Revenue based on | $ | 2,660.9 | ||
exchange rates of comparable period in previous year |
|
Contacts
Contact for Investor Relations
Aparna Iyer
Phone: +91-80-6142 7139
iyer.aparna@wipro.com
Abhishek Kumar Jain
Phone: +91-80-6142 6143
abhishekkumar.jain@wipro.com
Contact for Media & Press
Vipin Nair
Phone: +91-80-6142 6450
vipin.nair1@wipro.com
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