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Infosys (NYSE: INFY) Announces Results for the Quarter and Year Ended March 31, 2018BENGALURU, India, April 13, 2018 /PRNewswire/ --
1. Highlights of financial results for the quarter and year ended March 31, 2018
*USD/INR exchange rate as at March 31, 2018 (Logo: http://mma.prnewswire.com/media/610722/Infosys_Logo.jpg ) Financial Highlights Consolidated results under International Financial Reporting Standards (IFRS) for the quarter ended March 31, 2018
Consolidated results under International Financial Reporting Standards (IFRS) for the year ended March 31, 2018
FY 18 net profits included impact on account of conclusion of an APA with the US IRS
"Revenue productivity per employee was stable during the year as the benefits of automation and newer services kicked in. Employee utilization remained healthy," said Pravin Rao, COO. "During the quarter, we provided highest level of variable payouts in several years. We will be rolling out compensation increases for a large part of our workforce effective April 1st." "Our operating margins during the quarter and fiscal 2018 were resilient due to unwavering focus on productivity and operational efficiency, leading to a robust cash generation. During the year, the company implemented the capital allocation policy including the successful closure of $2 billion share buyback program in December 2017 and healthy increase in Dividend Per Share for the year," said M.D. Ranganath, CFO. "Our margin guidance reflects our emphasis on digital-led growth and focused investments in this journey."
2. Outlook for FY 2019 The Company's outlook (consolidated) for the fiscal year ending March 31, 2019, under IFRS is as follows:
*FY 18 constant currency rates - AUD/USD - 0.78; Euro/USD - 1.18; GBP/USD - 1.33 **Currency rates as of March 31, 2018 - AUD/USD - 0.77; Euro/USD - 1.24; GBP/USD - 1.42
3. Capital Allocation The Board, in its meeting on April 13, 2018, reviewed and approved the Capital Allocation Policy of the Company after taking into consideration the strategic and operational cash requirements of the Company in the medium term. The key aspects of the Capital Allocation Policy are:
*USD/INR exchange rate at 65.00
4. Dividend Payout For the Financial Year 201, the Board recommended a final dividend of INR 20.50 per share ($0.31 per ADR) amounting to INR 5,349 crore ($821 million) including DDT. After including the interim dividend of INR 13 per share, the total dividend for Financial Year 2018 will amount to INR 33.50 per share resulting in a payout of INR 8,771 crore ($1,349 million) including DDT, which will amount to approximately 70% of free cash flow for the Financial Year 2018. The total dividend of INR 33.50 per share is approximately 30% higher than total dividend of INR 25.75 per share for Financial Year 2017. The aggregate dividend including the special dividend of INR 10 per share ($0.15 per ADR) works out to INR 43.50 per share ($0.67 per ADR) resulting in an aggregate dividend payout of approximately INR 11,371 crore (approximately $1,749 million), including DDT.
5. Lead Independent Director The Board appointed Kiran Mazumdar-Shaw, Independent Director as the Lead Independent Director of the Board.
6. Acquisition On April 13, 2018, the Company entered into a definitive agreement to acquire WongDoody Holding Company, Inc., a US-based digital creative and consumer insights agency for a total consideration of up to $75 million including contingent consideration and retention payouts, subject to regulatory approvals and fulfillment of closing conditions.
7. Review of Subsidiaries In the quarter ended March 31, 2018, on conclusion of a strategic review of its portfolio of businesses, the Company initiated identification and evaluation of potential buyers for its subsidiaries, Kallidus and Skava (together referred to as "Skava") and Panaya (collectively referred to as the "disposal group"). The Company anticipates completion of the sale by March 2019 and accordingly, assets amounting to INR 2,060 crore ($316 million) and liabilities amounting to INR 324 crore ($50 million) in respect of the disposal group have been reclassified and presented as "held for sale". On reclassification, an impairment loss of INR 118 crore ($18 million) in respect of Panaya has been recognized in the consolidated profit and loss for the quarter and year ended March 31, 2018. The corresponding write down in the investment value of Panaya in the standalone financial statements of Infosys Ltd. is INR 589 crore ($90 million).
About Infosys Ltd. Infosys is a global leader in technology services and consulting. We enable clients in 45 countries to create and execute strategies for their digital transformation. From engineering to application development, knowledge management and business process management, we help our clients find the right problems to solve, and to solve these effectively. Our team of 200,000+ innovators, across the globe, is differentiated by the imagination, knowledge and experience, across industries and technologies that we bring to every project we undertake. Visit http://www.infosys.com to see how Infosys (NYSE: INFY) can help your enterprise thrive in the digital age. Safe Harbor Certain statements in this release, including those concerning our future growth prospects are forward-looking statements regarding our future business expectations, the amount and timing of future dividends and other potential future payments to shareholders, and the intent to identify potential buyers for Skava and Panaya and the anticipated timing to complete such sales, are forward-looking statements intended to qualify for the 'safe harbor' under the Private Securities Litigation Reform Act of 1995, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited those relating to risks and uncertainties regarding fluctuations in earnings, fluctuations in foreign exchange rates, our ability to manage growth, intense competition in IT services including those factors which may affect 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, industry segment concentration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which Infosys has made strategic investments, withdrawal or expiration of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry, capital allocation policy and the ability and timing to identify buyers for Skava and Panaya and to successfully complete such sales. Additional risks that could cause actual results to differ materially are more fully described in our United States Securities and Exchange Commission filings including our Annual Report on Form 20-F for the fiscal year ended March 31, 2017. These filings are available at http://www.sec.gov. Please note that any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of the date of this release. The Company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the Company unless it is required by law.
Infosys Limited and subsidiaries Unaudited Condensed Consolidated Balance Sheets as at (Dollars in millions except equity share data) March 31, 2018 March 31, 2017 ASSETS Current assets Cash and cash equivalents 3.041 3,489 Current investments 982 1,538 Trade receivables 2,016 1,900 Unbilled revenue 654 562 Prepayments and other current assets 662 749 Derivative financial instruments 2 44 7,357 8,282 Assets held for sale (4) 316 - Total current assets 7,673 8,282 Non-current assets Property, plant and equipment 1,863 1,807 Goodwill 339 563 Intangible assets 38 120 Investment in associate - 11 Non-current investments 883 984 Deferred income tax assets 196 83 Income tax assets 931 881 Other non-current assets 332 123 Total non-current assets 4,582 4,572 Total assets 12,255 12,854 LIABILITIES AND EQUITY Current liabilities Trade payables 107 57 Derivative financial instruments 6 - Current income tax liabilities 314 599 Client deposits 6 5 Unearned revenue 352 274 Employee benefit obligations 218 209 Provisions 75 63 Other current liabilities 1,036 954 2,114 2,161 Liabilities directly associated with assets held for sale(4) 50 - Total current liabilities 2,164 2,161 Non-current liabilities Deferred income tax liabilities 82 32 Employee benefit obligations 7 - Other non-current liabilities 42 24 Total liabilities 2,295 2,217 Equity Share capital- INR 5 ($0.16) par value 2,400,000,000 (2,400,000,000) equity shares authorized, issued and outstanding 2,173,312,301 (2,285,655,150), net of 10,801,956 (11,289,514) treasury shares as at March 31, 2018 (March 31, 2017), respectively 190 199 Share premium 247 587 Retained earnings 11,587 12,190 Cash flow hedge reserve - 6 Other reserves 244 - Capital redemption reserve 9 - Other components of equity (2,317) (2,345) Total equity attributable to equity holders of the company 9.960 10,637 Non-controlling interests - - Total equity 9,960 10,637 Total liabilities and equity 12,255 12,854 Infosys Limited and subsidiaries Unaudited Condensed Consolidated Statements of Comprehensive Income Three months Three months Year ended Year ended ended March ended March March 31, March 31, 31, 2018 31, 2017 2018 2017 Revenues 2,805 2,569 10,939 10,208 Cost of sales 1,793 1,614 7,001 6,446 Gross profit 1,012 955 3,938 3,762 Operating expenses: Selling and marketing expenses 147 133 552 535 Administrative expenses 172 188 727 707 Total operating expenses 319 321 1,279 1,242 Operating profit 693 634 2,659 2,520 Other income, net[(4)(5)] 82 112 495 459 Share in net profit/(loss) of associate, including impairment[(6)] - (4) (11) (5) Profit before income taxes 775 742 3,143 2,974 Income tax expense[(3)] 204 199 657 834 Net profit[(3)] 571 543 2,486 2,140 Other comprehensive income Items that will not be reclassified subsequently to profit or loss: Re-measurements of the net defined benefit liability/asset, net 6 3 9 (7) Cumulative impact on reversal of unrealized gain on quoted debt securities on adoption of IFRS 9 - - - (5) Equity instruments through other comprehensive income, net 1 (1) 1 (1) Items that will be reclassified subsequently to profit or loss: Fair valuation of investments, net (2) (2) - (2) Fair value changes on derivatives designated as cash flow hedge, net - 2 (6) 6 Foreign currency translation (164) 441 18 198 Total other comprehensive income/(loss), net of tax (159) 443 22 189 Total comprehensive income 412 986 2,508 2,329 Profit attributable to: Owners of the Company 571 543 2,486 2,140 Non-controlling interests - - - - 571 543 2,486 2,140 Total comprehensive income attributable to: Owners of the Company 412 986 2,508 2,329 Non-controlling interests - - - - 412 986 2,508 2,329 Earnings per equity share[(3)] Basic ($) 0.26 0.24 1.10 0.94 Diluted ($) 0.26 0.24 1.10 0.94 Weighted average equity shares used in computing earnings per equity share Basic 217,32,77,060 228,56,54,881 225,53,32,322 228,56,39,447 Diluted 217,48,08,512 228,66,52,003 225,75,73,870 2,28,63,96,745 NOTES:
IFRS-INR Press Release: https://www.infosys.com/investors/reports-filings/quarterly-results/2017-2018/q4/Documents/IFRS-INR-press-release.pdf Fact Sheet: https://www.infosys.com/investors/reports-filings/quarterly-results/2017-2018/q4/Documents/fact-sheet.pdf Contacts: 
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