Modest 2Q for Infosys, Guidance Dips
Infosys Technologies Limited (INFY) reported its second quarter fiscal 2013 earnings results, with earnings per ADS from continuing operations of 75 cents beating the Zacks Consensus Estimate by a penny. Earnings grew 4.2% year over year, led by growth in all areas and across the customer base.
Business Details
Total revenue for the quarter was $1.8 billion, up 2.9% year over year. The company saw growth in retail and manufacturing and also in banking, insurance and financial services.
The company delivered a modest quarter in terms of client additions. Infosys added 39 new clients during the quarter. The company’s cloud based offerings attained good momentum during the quarter. During the reported quarter, the company completed approximately 170 cloud based projects and also received 20 new contracts for the same.
Income
The company recorded an operating profit of $472 million compared with $490 million in the prior-year period. Net profit after tax was $431 million for the quarter, which was up 5% year over year.
Balance Sheet
Infosys maintains a strong liquidity position and had cash & cash equivalents (including investments in available-for-sale financial assets, certificates of deposits and government bonds) of 4.3 billion as of September 30, 2012 compared with $3.8 billion as of September 30, 2011.
Outlook
Driven by the modest performance of the company in the reported quarter, earnings per ADS are expected to be $2.97 compared with $3.03 projected earlier.
For the fiscal year ending March 31, 2013, the company expects revenue to be $7.34 billion. Infosys currently maintains a Zacks #3 Rank, which currently implies a short-term Hold rating on the stock.
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