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Wipro meets forecasts with 2% profit rise in December quarter but margins hit

The Bangalore-headquartered firm had posted a net profit (after tax, minority interest and share of profit of associates) of Rs 2192.8 crore in the year-ago period.

BT Online | January 18, 2016 | Updated 20:31 IST
Wipro Q3 PAT rises 1.88% y-o-y to Rs 2234.1 crore
The company has declared an interim dividend of Rs 5 per share/American Depositary Share. Photo: Reuters

Country's third largest software services firm Wipro on Monday reported a 1.88 per cent growth in consolidated net profit at Rs 2234.1 crore for the third quarter ended December 31, 2015.

The Bangaluru-headquartered firm had posted a net profit (after tax, minority interest and share of profit of associates) of Rs 2192.8 crore in the year-ago period, the IT firm said in a filing to BSE.

The IT major saw revenues rising 7.1 per cent to Rs 12,951.6 crore in the said quarter from Rs 12,085.1 in the same period last year.

Its IT services revenues stood at Rs 12,310 crore ($1.86 billion), an increase of 9 per cent year-on-year.

The company had already warned of a muted performance in this quarter on account of furloughs and Chennai-floods. It had said it expected to meet the lower half of its guidance range of $1,841-1,878 million.

For the fourth quarter, Wipro expects its revenues from the IT services business to be in the range of $1,875 million to $1,912 million.

The company has declared an interim dividend of Rs 5 per share/American Depositary Share. the payment date for interim dividend will be made on or before February 2, 2016.

"We delivered Revenues in line with our guidance. We saw a pick-up in large deal closures led by Global Infrastructure Services. It is becoming increasingly clear that customers want to simplify operations and optimize their IT spend while investing in Digital to transform their business. We are well-positioned to take advantage of this trend," said T K Kurien, Member of the Board & Chief Executive Officer, Wipro.

Wipro Chief Financial Officer Jatin Dalal said the impact on revenues from the Chennai floods were minimised significantly by execution of Business Continuity Plans (BCP).

"The additional expenses incurred in deploying BCP impacted operating margins for the quarter," he added.

The IT services segment had a headcount of 1,70,664 as of December 31, 2015. It added 39 new customers during the quarter.

"We are focussed on driving market share growth in our core businesses through integrated domain and technology services, while investing for the future in building differentiated Digital capabilities," Wipro CEO-Designate Abidali Z Neemuchwala said.

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