HCL net up 21% in Q4; projects flat growth in FY18

New Delhi, May 11 (IANS) Global software major HCL Technologies Ltd, which posted double-digit net profit and revenue growth for the fourth quarter (Q4) and fiscal 2016-17, on Thursday projected flat revenue growth for fiscal 2017-18 in dollar terms.

"Revenue for fiscal 2017-18 (FY 2018) is expected to grow 9.9-11.9 per cent year-on-year (YoY) as compared to 11.9 per cent YoY growth posted in fiscal 2016-17 (FY 2017) in dollar terms," said the Noida-based company in a statement here.

In constant currency, revenue is expected to grow 10.5-12.5 per cent YoY in dollar terms.

"The revenue guidance is based on average exchange rate of US dollar (Rs 65.50) and other currencies in FY 2017," noted the statement.

Operating Margin is expected to be 19.5-20.5 per cent for FY 2018.

In a regulatory filing on the BSE earlier in the day, the company said it posted Rs 2,325 crore consolidated net profit for Q4 registering 21 per cent YoY growth from Rs 1,926 crore in the same period year ago (2015-16).

Sequentially, the net profit in Q4 (Rs 2,325 crore) increased from Rs 2,070 crore in the third quarter (Q3), posting 12.3 per cent Quarter-on-Quarter (QoQ) growth.

Consolidated revenue for the quarter (Q4) under review grew 12.7 per cent YoY to Rs 12,053 crore from Rs 10,698 crore in like period year ago and two per cent QoQ from Rs 11,814 crore quarter ago (Q3).

For FY 2017 under review, net profit grew 15 per cent YoY to Rs 8,457 crore from Rs 7,354 crore year ago (FY 2016) and revenue 14.2 per cent YoY to Rs 46,723 crore from Rs 40,913 crore year ago (FY 2016).

Under the International Financial Regulatory Standards (IFRS), net income for Q4 grew 22.7 per cent YoY to $350 million from $285 million in like period year ago and 14.3 per cent QoQ from $306 million quarter ago (Q3).

Gross revenue under IFRS for Q4 grew 14.5 per cent YoY to $1,817 million from $1,587 million in the same period year ago and 4.1 per cent QoQ from $1,745 million quarter ago (Q3).

Net income for FY 2017 under IFRS grew 12.9 per cent YoY to $1,262 million from $1,118 million in FY 2016 and gross revenue 11.9 per cent YoY to $6,975 million from $6,235 million in FY 2016.

"We are pleased with our industry-leading financial results for the fourth quarter and the full year. In Q4, we had a healthy 3.8 per cent sequential revenue growth in constant currency," said HCL Technologies Chief Executive Officer C. Vijayakumar in the statement later.

For the fiscal under review, the IT major delivered a double-digit constant currency revenue growth of 13.7 per cent, which is at the higher end of its guided range.

"Our differentiated services, which focus on new growth areas like digital, Cloud, security and IoT (Internet of Things) as well as products and platforms registered an impressive 30.9 per cent YoY growth in the fiscal under review," noted Vijayakumar.

Commenting on the results, HCL Chairman Shiv Nadar said the company remained at the forefront of the changing market paradigm with leadership, value-driven business model and focus on sustainability, diversity and inclusion.

"With the advent of the fourth industrial revolution, we are seeing a convergence of physical and digital worlds. This convergence is creating an interplay of business models and redefining the way value is created and delivered," Nadar said in the statement.

HCL Chief Financial Officer Anil Chanana said that cash flow generation during the fiscal was robust, with net income to operating cash flow conversion at 112 per cent.

"Our focus on rewarding shareholders continues, with Rs 3,500-crore buyback of shares (Rs 2 face value) programme. Return on equity continues to be healthy at 27 per cent for the fiscal," added Chanana.

With a net addition of 11,077 employees in FY 2017, the headcount increased to 115,973 from 104,896 in FY 2016, while annual attrition declined marginally to 16.9 per cent from 17.3 per cent year ago.