Indian software services provider Wipro Ltd. (WIT: Quote) reported Thursday a profit for the third quarter that grew 18 percent from last year, helped by double-digit revenue growth amid client additions. In dollar terms, both earnings per share and quarterly revenues matched analysts’ expectations. Further, Wipro projected a sequential revenue growth for IT Services in the fourth quarter.
“We have expanded operating margins sequentially through improvements in revenue productivity and improved cash flow generation through efficient working capital management,” Executive Director and CFO Suresh Senapaty said in a statement.
The Bangalore, India-based company reported net income attributable to equity holders of 17.16 billion rupees or 6.98 rupees per share and in dollar terms $313 million or $0.13 per share, up from last year’s 14.56 billion rupees or 5.93 rupees per share. Wipro reports results on the basis of International Financial Reporting Standards.
Excluding the impact of accelerated amortization of stock options, adjusted net income attributable to equity holders totaled 17.10 billion rupees or $312 million.
On average, six analysts polled by Thomson Reuters expected the company to earn $0.13 per share for the third quarter. Analysts’ estimates typically exclude special items.
Wipro’s second-quarter net income attributable to equity holders was 16.11 billion rupees or 6.55 rupees per share.
Total revenues for the third quarter grew 10 percent to 110.25 billion rupees or $2.01 billion, from 99.97 billion rupees in the same quarter last year, and also increased from the previous quarter’s 106.57 billion rupees. Seven Wall Street analysts had a consensus revenue estimate of $2.01 billion for the quarter.
IT Services revenue in rupee terms was 86.02 billion rupees, or $1.57 billion, a year-over-year increase of 13 percent. The company’s guidance was for revenues between $1.56 billion and $1.59 billion.
IT Products revenues grew 11 percent, and consumer care and lighting revenues increased 17 percent from a year ago.
Wipro said its IT Services added 50 new clients in the quarter and also reported net addition of 2,336 employees in the third quarter in IT Services.
“Our improvement in customer and employee engagement is reflected in client mining with 10 customers contributing more than $100 million and lower attrition. We continue to make investments in our go to market organization and technology themes to be a strategic partner to our customers,” T K Kurien, CEO of IT business said.
Wipro also declared an interim dividend of 2 rupees or $0.041 per share / ADS.
Looking ahead to the fourth quarter, the company expects revenues from IT Services business to be in the range of $1.585 billion to $1.625 billion.
“While the overall mood on economic growth continues to be muted, global corporations continue to leverage technology to drive revenues and productivity,” Chairman Azim Premji noted.
Wipro’s Bangalore-based peer, Infosys Technologies Ltd. (INFY: Quote) reported last week a 5 percent decline in profit for the third quarter to $434 million or $0.76 per ADS, while revenues grew 5.5 percent to $1.91 billion from last year. The group added 53 clients during the quarter. However, the company raised its revenue forecast for the full year, while earnings outlook remained unchanged.
WIT closed Thursday’s regular trading session at $9.91, up $0.24 or 2.48% on a volume of 0.70 million shares. In the past 52-week period, the stock has been trading in a range of $7.56 to $11.49.
Wipro is currently trading in Friday’s regular trading session on the Bombay Stock Exchange at 416.80 rupees, down 14.30 rupees or 3.32% on a volume of 0.15 million shares.
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by RTT Staff Writer
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