Audited financial results for the quarter ended June 30, 2000
|Amounts in Rs. crores, except per share data of Rupees|
|Quarter ended June 30||Year ended March 31, 2000|
|Income from software products and services|
|Interest and others||7.69||5.66||29.20|
|Foreign travel expenses||30.21||17.91||84.09|
|Provision for contingencies||-||3.33||3.33|
|Provision for e-inventing the company||-||-||3.50|
|Operating profits (PBIDT)||152.75||77.93||378.88|
|Profit before tax and extraordinary item||135.01||68.61||325.65|
|Provision for tax||13.71||8.00||39.70|
|Profit after tax before extraordinary item||121.30||60.61||285.95|
|Effect of extraordinary item (net of tax)||5.49||-||7.57|
|Net profit after tax and extraordinary item||126.79||60.61||293.52|
|Paid up equity share capital||33.08||33.07||33.08|
|Earnings per share (of Rs. 5) from ordinary activities|
|Dividend per share||NA||NA||4.50|
- The above audited quarterly results have been taken on record by the Board at its meeting held on July11,2000.
- Fluctuations in exchange rate(s) during the quarter, with reference to exchange rate(s) as on March31, 2000 (March 31,
1999), led to an increase in income from software development
of Rs.4.98 crore (Rs.3.62 crore for quarter ended
June 30, 1999) and profit before tax of Rs.2.67 crore (Rs.2.03 crore for quarter ended June30,1999).
- Other income of Rs.15.11 crore (Rs.13.79 crore) for the quarter includes an amount of Rs.7.42 crore (Rs.8.13 crore)
arising from exchange differences on translation of foreign currency deposits kept abroad, which may be
non-recurring. Excluding such exchange differences of Rs.7.42 crore (Rs.8.13 crore), the profit after tax before
extra-ordinary item is Rs.113.88 crore, a 117% increase over the net profit of Rs.52.48 crore for the quarter
ended June30, 1999.
- During the quarter ended June 30,2000, the company transferred its intellectual property rights in
Onscan - a web-focussed wireless-enabled notification product, to Onscan Inc., USA, a company
incubated by Infosys as part of its ongoing effort to encourage and promote budding entrepreneurs
among its employees. The product was transferred for a gross consideration of Rs. 8.93
crores (US$ 2 million), received as equity, preferred voting and preferred non-voting securities
in Onscan Inc. The income out of the transfer of Rs. 5.49 crore (net of tax) is disclosed as
an extraordinary item.
- The company had instituted a contingency plan effective October 1, 1998 and made a total
provision of Rs.9.99 crore to meet any possible disruption in client support due to the Year 2000 impact on the
technology and communication
infrastructure provided to the company by its vendors. For the year ended
March 31, 2000, Rs. 2.42 crore was spent towards the Year 2000 transition effort, which was set off against
the provision and the balance of Rs. 7.57 crore was written back to the profit and loss account.
- The company had made a provision of Rs. 3.50 crore for the quarter ended September 30, 1999 towards e-inventing the company. As of March 31, 2000, Rs. 3.11 crore was incurred towards e-inventing the company, which was set-off
against the provision made earlier. The balance amount of Rs. 0.39 crore was incurred and set-off against this provision during the quarter ended June 30, 2000.
- During the quarter the company made a strategic investment of Rs. 13.40 crore in the form of
Convertible Preferred Stock in CiDRA Corporation, USA. CiDRA Corporation is a
developer of photonic devices for high-precision wavelength management and control
for next-generation optical networks.
- The increase in paid-up capital during the quarter represents the conversion of ADS stock
options into 667 equity shares consequent to their exercise.
- Basic and diluted earnings per share are retroactively restated to reflect the effect
of the 2-for-1 stock split announced during the quarter ended December 31, 1999.
- The Board of Directors, at their meeting held on May 27, 2000, co-opted Mr.Phaneesh Murthy,
Mr.V.Mohandas Pai and Mr. Srinath Batni as Additional Directors of the company with
effect from May 27, 2000. Messrs. Murthy, Pai and Batni will hold office up to the date of
the next Annual General Meeting, when their appointment as whole-time directors will be placed for the approval
of the members in general meeting. Mr. Susim M. Dutta retired as a director of the
company on May 27, 2000. Mr. Datta will turn 65, the age for superannuation in the coming year and consequently did
not seek reelection.
By order of the Board
for Infosys Technologies Ltd.
Chairman and Chief Executive Officer
July 11, 2000
The Board has also taken on record the unaudited results for the three months ended June 30, 2000,
prepared as per US GAAP. The summary of the above financial statements is as follows:
|Amount In US$|
|Particulars||Three months ended June 30, (Unaudited)||Fiscal 2000 (Audited)|
|Amortization of deferred stock compensation expense||1,275,796||1,250,100||5,117,635|
|Earnings per American Depositary Share|
|Cash and cash equivalents||105,756,757||102,612,617||116,599,486|
Note: Two American Depositary Shares (ADS) is equal are equivalent to one equity share.
The reconciliation of net income as per Indian GAAP and US GAAP for the three months ended June 30, 2000 and 1999 is as follows:
|Amount In US$|
|Three months ended June 30, (Unaudited)||Fiscal 2000 (Audited)|
|Net profit as per Indian GAAP||28,565,885||14,119,925||67,775,087|
|Amortization of deferred stock compensation expense||(1,275,796)||(1,250,100)||(5,117,635)|
|Provision for retirement benefits to employees||741,000||-||(741,000)|
|Provision for contingency / e- inventing the company||(87,387)||777,180||(1,422,815)|
|Transfer of intellectual property rights (net of tax)||(1,230,824)||-||-|
|Net income as per US GAAP||26,831,673||13,310,879||61,344,528|
- The income for the three months ended June 30, 2000 includes other income
of $ 1.66 million ($ 1.90 million) due to exchange differences on translation of foreign currency deposits
maintained abroad. Excluding the above, the net income and Earnings Per ADS would have been $ 25.17 million
and $ 0.19 for the quarter ended June 30, 2000 as compared to $ 11.41 million and $ 0.09 respectively
for the quarter ended June 30, 1999.
- The basic and the diluted earnings per American Depositary Shares have been retroactively
restated to reflect the increased number of ADS outstanding resulting from the stock split of 2-for-1
announced during the three months ended December 31, 1999.
Other than the historical information and discussions contained in this earnings release, certain statements may be forward-looking. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those that may be projected by these forward looking statements. These risks and uncertainties include, but are not limited to competition, acquisitions, attracting, recruiting and retaining highly skilled employees, the success of Onscan.
Inc., the success of the companies in which the company has made strategic investments, the company's incubation and investment policy, technology, law and regulatory policy and managing risks associated with customer projects as well as other
risks detailed in the reports filed by Infosys Technologies Limited with the Securities and Exchange Commission. Infosys undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof.