The Hindu : Business : Infosys Q1 net profit up 37 p.c.

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Wednesday, Jul 13, 2005

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Business

Infosys Q1 net profit up 37 p.c.

Special Correspondent

The group proposes to add 13,500 employees

— Photo: G. R. N. Somashekar

FAILS TO SPREAD CHEER: Chief Executive Officer Nandan Nilekani and Chief Operating Officer K. Gopalakrishnan, Infosys, addressing a press conference in Bangalore on Tuesday.

BANGALORE: The net profit of software major Infosys Technologies (Infosys) has jumped by 37 per cent for the April-June quarter of the current fiscal to touch Rs. 532 crore as compared to the corresponding quarter last year.

It earned revenues of Rs. 2,071.59 crore during the quarter, registering a growth of 37 per cent over the same period last fiscal.

Though there has been a sequential growth of 3.62 per cent in net profit over the last quarter of 2004-05, the performance has been below market expectations. While announcing the annual financial results for 2004-05 in April, Infosys had said that growth during the first two quarters of the current fiscal would be flatish owing to clients' pre-occupations with certain compliance related issues.

"Now all that is behind us. We do not see any impact on our revenues on account of compliance related issues,'' Nandan M. Nilekani, CEO, Infosys, said.

Admitting that it was a "subdued'' quarter, Infosys, however, said it had maintained margins despite absorbing annual salary increases and the adverse impact of a depreciating Euro and pound sterling as well as a hike in visa costs. "Considering all this, it is a good show,'' T. V. Mohandas Pai, Chief Financial Officer, said.

Infosys has marginally revised its guidance for the second quarter and for the remainder of the fiscal, factoring the likely impact of the recent London blasts on business travel plans. Revenues are now expected to grow by 27 per cent during the second quarter to Rs. 2,215 crore. Whereas for the fiscal ending March 31, 2006, the company expects a revenue growth of 25.49 to 26.95 per cent, translating into income in the range of Rs. 8,947 crore and Rs. 9,051 crore.

36 new clients

During the first quarter, the company added 36 new clients . It hired 3,056 employees during the quarter, taking the total workforce to 39,806 with the attrition rate stable at 9.8 per cent as against 9.7 per cent in the last quarter. "We expect to add another 13,500 employees across the group during the remaining nine months of the fiscal out of which 7,000 would be hired in the second quarter,'' K. Gopalakrishnan, COO, said.

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