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Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO), a leading technology services and consulting company, announced financial results under International Financial Reporting Standards (IFRS) for the quarter and year ended March 31, 2024.
Highlights of the Results
Results for the Quarter ended March 31, 2024:
Results for the Year ended March 31, 2024:
Outlook for the Quarter ending June 30, 2024
We expect revenue from our IT Services business segment to be in the range of $2,617 million to $2,670 million*. This translates to sequential guidance of (-)1.5% to +0.5% in constant currency terms.
* Outlook for the Quarter ending June 30, 2024, is based on the following exchange rates: GBP/USD at 1.26, Euro/USD at 1.08, AUD/USD at 0.66, USD/INR at 83.19 and CAD/USD at 0.74
Performance for the Quarter and Year ended March 31, 2024
Srini Pallia, CEO and Managing Director, said, “FY24 proved to be a challenging year for our industry, and the macroeconomic environment remains uncertain. However, I am optimistic about the opportunities that lie ahead. We are on the brink of a major technological shift. Artificial intelligence is transforming our clients’ needs as they seek to harness its power for competitive advantage and enhanced business value. At Wipro, we have been gearing up for this moment. We have the capabilities, leadership, and the strength of over 230,000 Wiproites around the world to help us realize our goals. Although there’s a considerable amount of work ahead of us, I am confident that together, with our collective effort, we can pave the way for the next chapter of growth.”
Aparna Iyer, Chief Financial Officer, said, “We expanded our margins by 40 basis points during the quarter resulting in EPS growth of 5.2% QoQ in Q4. Despite a challenging macro-environment our IT services margin expanded by 50 basis points for the full year FY24. We generated highest operating cash flow in recent years which is at 183% of our net- income in Q4 and 159% on a full year basis.”
Capital Allocation:
The Board of Directors confirmed the interim dividend of Rs 1 declared by the Board earlier at its meeting held on January 12th, 2024, shall be considered as the final dividend for the financial year 2023-24.
Highlights of Strategic Deal Wins
In the fourth quarter, Wipro continued to win large and strategic deals across industries. Key highlights include:
Analyst Recognition
Source & Disclaimer: *Gartner, “Magic Quadrant for Public Cloud IT Transformation Services”, Mark Ray, et al, 16 August 2023.
GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally, and MAGIC QUADRANT is a registered trademark of Gartner, Inc. and/or its affiliates and are used herein with permission. All rights reserved.
Gartner does not endorse any vendor, product, or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner's research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.
The Gartner content described herein (the “Gartner Content”) represents research opinion or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. ("Gartner"), and is not a representation of fact. Gartner Content speaks as of its original publication date (and not as of the date of this [type of filing]), and the opinions expressed in the Gartner Content are subject to change without notice.
IT Products
Please refer to the table at the end for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.
About Key Metrics and Non-GAAP Financial Measures
This press release contains key metrics and non-GAAP financial measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. Such non-GAAP financial measures are measures of our historical or future performance, financial position or cash flows that are adjusted to exclude or include amounts that are excluded or included, as the case may be, from the most directly comparable financial measure calculated and presented in accordance with IFRS.
The table at the end provides IT Services Revenue on a constant currency basis, which is a non-GAAP financial measure that is calculated by translating IT Services Revenue from the current reporting period into U.S. dollars based on the currency conversion rate in effect for the prior reporting period. We refer to growth rates in constant currency so that business results may be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our business performance. Further, in the normal course of business, we may divest a portion of our business which may not be strategic. We refer to the growth rates in both reported and constant currency adjusting for such divestments in order to represent the comparable growth rates.
Our key metrics and non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, the most directly comparable financial measure calculated in accordance with IFRS and may be different from non-GAAP measures used by other companies. Our key metrics and non-GAAP financial measures are not comparable to, nor should be substituted for, an analysis of our revenue over time and involve estimates and judgments. In addition to our non-GAAP measures, the financial statements prepared in accordance with IFRS and the reconciliation of these non-GAAP financial measures with the most directly comparable IFRS financial measure should be carefully evaluated.
Results for the Quarter and Year ended March 31, 2024, prepared under IFRS, along with individual business segment reports, are available in the Investors section of our website www.wipro.com/investors/
Quarterly Conference Call
We will hold an earnings conference call today at 07:00 p.m. Indian Standard Time (9:30 a.m. U.S. Eastern Time) to discuss our performance for the quarter and the year. The audio from the conference call will be available online through a webcast and can be accessed at the following link-
https://links.ccwebcast.com/?EventId=WIP190424
An audio recording of the management discussions and the question-and-answer session will be available online and will be accessible in the Investor Relations section of our website at www.wipro.com
About Wipro Limited
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) is a leading technology services and consulting company focused on building innovative solutions that address clients’ most complex digital transformation needs. Leveraging our holistic portfolio of capabilities in consulting, design, engineering, and operations, we help clients realize their boldest ambitions and build future-ready, sustainable businesses. With over 230,000 employees and business partners across 65 countries, we deliver on the promise of helping our clients, colleagues, and communities thrive in an ever-changing world. For additional information, visit us at www.wipro.com
Forward-Looking Statements
The forward-looking statements contained herein represent Wipro’s beliefs regarding future events, many of which are by their nature, inherently uncertain and outside Wipro’s control. Such statements include, but are not limited to, statements regarding Wipro’s growth prospects, its future financial operating results, the benefits its customers experience and its plans, expectations and intentions. Wipro cautions readers that the forward-looking statements contained herein are subject to risks and uncertainties that could cause actual results to differ materially from the results anticipated by such statements. Such risks and uncertainties include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, revenue and profits, our ability to generate and manage growth, complete proposed corporate actions, intense competition in IT services, our ability to maintain 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, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which we make strategic investments, withdrawal of fiscal governmental incentives, political instability, war, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property and general economic conditions affecting our business and industry.
Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission, including, but not limited to, Annual Reports on Form 20-F. These filings are available at www.sec.gov. We may, from time to time, make additional written and oral forward-looking statements, including statements contained in the company’s filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.
| WIPRO LIMITED AND SUBSIDIARIES | ||||||
| INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION | ||||||
| (Rs in millions, except share and per share data, unless otherwise stated) | ||||||
| As at March 31, 2023 | As at March 31, 2024 | |||||
| Convenience translation into US dollar in millions (unaudited) Refer to Note 2(iii) | ||||||
| ASSETS | ||||||
| Goodwill | 3,07,970 | 3,16,002 | 3,792 | |||
| Intangible assets | 43,045 | 32,748 | 393 | |||
| Property, plant and equipment | 88,659 | 81,608 | 979 | |||
| Right-of-Use assets | 18,702 | 17,955 | 215 | |||
| Financial assets | ||||||
| Derivative assets | 29 | 25 | ^ | |||
| Investments | 20,720 | 21,629 | 260 | |||
| Trade receivables | 863 | 4,045 | 49 | |||
| Other financial assets | 6,330 | 5,550 | 67 | |||
| Investments accounted for using the equity method | 780 | 1,044 | 13 | |||
| Deferred tax assets | 2,100 | 1,817 | 22 | |||
| Non-current tax assets | 11,922 | 9,043 | 109 | |||
| Other non-current assets | 13,606 | 10,331 | 124 | |||
| Total non-current assets | 5,14,726 | 5,01,797 | 6,023 | |||
| Inventories | 1,188 | 907 | 11 | |||
| Financial assets | ||||||
| Derivative assets | 1,844 | 1,333 | 16 | |||
| Investments | 3,09,232 | 3,11,171 | 3,734 | |||
| Cash and cash equivalents | 91,880 | 96,953 | 1,163 | |||
| Trade receivables | 1,26,350 | 1,15,477 | 1,387 | |||
| Unbilled receivables | 60,515 | 58,345 | 700 | |||
| Other financial assets | 9,096 | 10,536 | 126 | |||
| Contract assets | 23,001 | 19,854 | 238 | |||
| Current tax assets | 5,091 | 6,484 | 78 | |||
| Other current assets | 32,899 | 29,602 | 355 | |||
| Total current assets | 6,61,096 | 6,50,662 | 7,808 | |||
| TOTAL ASSETS | 11,75,822 | 11,52,459 | 13,831 | |||
| EQUITY | ||||||
| Share capital | 10,976 | 10,450 | 125 | |||
| Share premium | 3,689 | 3,291 | 39 | |||
| Retained earnings | 6,60,964 | 6,30,936 | 7,571 | |||
| Share-based payment reserve | 5,632 | 6,384 | 77 | |||
| Special Economic Zone re-investment reserve | 46,803 | 42,129 | 506 | |||
| Other components of equity | 53,100 | 56,693 | 680 | |||
| Equity attributable to the equity holders of the Company | 7,81,164 | 7,49,883 | 8,998 | |||
| Non-controlling interests | 589 | 1,340 | 16 | |||
| TOTAL EQUITY | 7,81,753 | 7,51,223 | 9,014 | |||
| LIABILITIES | ||||||
| Financial liabilities | ||||||
| Loans and borrowings | 61,272 | 62,300 | 748 | |||
| Lease liabilities | 15,953 | 13,962 | 168 | |||
| Derivative liabilities | 179 | 4 | ^ | |||
| Other financial liabilities | 2,649 | 4,985 | 60 | |||
| Deferred tax liabilities | 15,153 | 17,467 | 210 | |||
| Non-current tax liabilities | 21,777 | 37,090 | 445 | |||
| Other non-current liabilities | 9,333 | 12,970 | 156 | |||
| Provisions | ^ | - | - | |||
| Total non-current liabilities | 1,26,316 | 1,48,778 | 1,787 | |||
| Financial liabilities | ||||||
| Loans, borrowings and bank overdrafts | 88,821 | 79,166 | 950 | |||
| Lease liabilities | 8,620 | 9,221 | 111 | |||
| Derivative liabilities | 2,825 | 558 | 7 | |||
| Trade payables and accrued expenses | 89,054 | 88,566 | 1,062 | |||
| Other financial liabilities | 4,141 | 2,272 | 27 | |||
| Contract liabilities | 22,682 | 17,653 | 212 | |||
| Current tax liabilities | 18,846 | 21,756 | 261 | |||
| Other current liabilities | 30,215 | 31,295 | 376 | |||
| Provisions | 2,549 | 1,971 | 24 | |||
| Total current liabilities | 2,67,753 | 2,52,458 | 3,030 | |||
| TOTAL LIABILITIES | 3,94,069 | 4,01,236 | 4,817 | |||
| TOTAL EQUITY AND LIABILITIES | 11,75,822 | 11,52,459 | 13,831 | |||
| ^ Value is less than 1 | ||||||
| WIPRO LIMITED AND SUBSIDIARIES | ||||||||||||||
| INTERIM CONDENSED CONSOLIDATED STATEMENT OF INCOME | ||||||||||||||
| (Rs in millions, except share and per share data, unless otherwise stated) | ||||||||||||||
| Three months ended March 31, | Year ended March 31, | |||||||||||||
| 2023 | 2024 | 2024 | 2023 | 2024 | 2024 | |||||||||
| Convenience translation into US dollar in millions (unaudited) Refer to Note 2(iii) | Convenience translation into US dollar in millions (unaudited) Refer to Note 2(iii) | |||||||||||||
| Revenues | 2,31,903 | 2,22,083 | 2,665 | 9,04,876 | 8,97,603 | 10,770 | ||||||||
| Cost of revenues | (1,62,738) | (1,57,219) | (1,886) | (6,45,446) | (6,31,497) | (7,577) | ||||||||
| Gross profit | 69,165 | 64,864 | 779 | 2,59,430 | 2,66,106 | 3,193 | ||||||||
| Selling and marketing expenses | (16,906) | (15,443) | (185) | (65,157) | (69,972) | (840) | ||||||||
| General and administrative expenses | (15,672) | (13,920) | (167) | (59,139) | (60,375) | (724) | ||||||||
| Foreign exchange gains/(losses), net | 990 | (128) | (2) | 4,472 | 340 | 4 | ||||||||
| Results from operating activities | 37,577 | 35,373 | 425 | 1,39,606 | 1,36,099 | 1,633 | ||||||||
| Finance expenses | (2,860) | (3,308) | (40) | (10,077) | (12,552) | (151) | ||||||||
| Finance and other income | 5,463 | 6,759 | 81 | 18,185 | 23,896 | 287 | ||||||||
| Share of net profit/ (loss) of associate and joint venture accounted for using the equity method | 4 | (202) | (2) | (57) | (233) | (3) | ||||||||
| Profit before tax | 40,184 | 38,622 | 464 | 1,47,657 | 1,47,210 | 1,766 | ||||||||
| Income tax expense | (9,249) | (10,040) | (120) | (33,992) | (36,089) | (433) | ||||||||
| Profit for the period | 30,935 | 28,582 | 344 | 1,13,665 | 1,11,121 | 1,333 | ||||||||
| Profit attributable to: | ||||||||||||||
| Equity holders of the Company | 30,745 | 28,346 | 341 | 1,13,500 | 1,10,452 | 1,325 | ||||||||
| Non-controlling interests | 190 | 236 | 3 | 165 | 669 | 8 | ||||||||
| Profit for the period | 30,935 | 28,582 | 344 | 1,13,665 | 1,11,121 | 1,333 | ||||||||
| Earnings per equity share: | ||||||||||||||
| Attributable to equity holders of the Company | ||||||||||||||
| Basic | 5.61 | 5.43 | 0.07 | 20.73 | 20.89 | 0.25 | ||||||||
| Diluted | 5.60 | 5.41 | 0.07 | 20.68 | 20.82 | 0.25 | ||||||||
| Weighted average number of equity shares | ||||||||||||||
| used in computing earnings per equity share | ||||||||||||||
| Basic | 5,48,13,66,536 | 5,22,23,50,323 | 5,22,23,50,323 | 5,47,74,66,573 | 5,28,82,85,555 | 5,28,82,85,555 | ||||||||
| Diluted | 5,48,98,78,685 | 5,23,51,75,711 | 5,23,51,75,711 | 5,48,89,91,175 | 5,30,57,12,314 | 5,30,57,12,314 | ||||||||
| ^ Value is less than 1 | ||||||||||||||
| Particulars | Three months ended | Year ended | |||
| March 31, 2024 | December 31, 2023 | March 31, 2023 | March 31, 2024 | March 31, 2023 | |
| Audited | Audited | Audited | Audited | Audited | |
| Segment revenue | |||||
| IT Services | |||||
| Americas 1 | 67,229 | 68,581 | 66,430 | 268,230 | 261,270 |
| Americas 2 | 67,724 | 66,541 | 70,563 | 269,482 | 278,374 |
| Europe | 61,344 | 61,473 | 67,562 | 253,927 | 256,845 |
| APMEA | 24,499 | 24,913 | 27,207 | 102,177 | 106,812 |
| Total of IT Services | 220,796 | 221,508 | 231,762 | 893,816 | 903,301 |
| IT Products | 1,159 | 805 | 1,131 | 4,127 | 6,047 |
| Total segment revenue | 221,955 | 222,313 | 232,893 | 897,943 | 909,348 |
| Segment result | |||||
| IT Services | |||||
| Americas 1 | 14,081 | 16,459 | 13,445 | 59,364 | 51,555 |
| Americas 2 | 15,791 | 15,180 | 15,940 | 59,163 | 59,689 |
| Europe | 7,933 | 7,906 | 11,024 | 33,354 | 37,667 |
| APMEA | 3,401 | 3,433 | 3,030 | 12,619 | 10,681 |
| Unallocated | (5,011) | (7,552) | (5,773) | (20,304) | (18,368) |
| Total of IT Services | 36,195 | 35,426 | 37,666 | 144,196 | 141,224 |
| IT Products | 143 | 114 | (59) | (371) | (176) |
| Reconciling Items | (965) | (2,675) | (30) | (7,726) | (1,442) |
| Total segment result | 35,373 | 32,865 | 37,577 | 136,099 | 139,606 |
| Finance expenses | (3,308) | (3,125) | (2,860) | (12,552) | (10,077) |
| Finance and other income | 6,759 | 5,785 | 5,463 | 23,896 | 18,185 |
| Share of net profit/ (loss) of associate and joint venture accounted for using the equity method | (202) | (4) | 4 | (233) | (57) |
| Profit before tax | 38,622 | 35,521 | 40,184 | 147,210 | 147,657 |
Additional Information:
Effective April 1, 2023, we merged our India State Run Enterprise segment (“ISRE”) with our IT Services segment. Currently, the Company is organized into the following operating segments: IT Services and IT Products.
IT Services: As announced on November 12, 2020, effective January 1, 2021, we re-organized our IT Services segment into four Strategic Market Units (“SMUs”) - Americas 1, Americas 2, Europe and Asia Pacific Middle East Africa (“APMEA”).
Americas 1 and Americas 2 are primarily organized by industry sector, while Europe and APMEA are organized by countries.
Americas 1 includes Healthcare and Medical Devices, Consumer Goods and Lifesciences, Retail, Transportation and Services, Communications, Media and Information services, Technology Products and Platforms, in the United States of America and entire business of Latin America (“LATAM"). Americas 2 includes Banking, Financial Services and Insurance, Manufacturing, Hi-tech, Energy and Utilities industry sectors in the United States of America and entire business of Canada. Europe consists of the United Kingdom and Ireland, Switzerland, Germany, Benelux, the Nordics and Southern Europe. APMEA consists of Australia and New Zealand, India, the Middle East, Southeast Asia, Japan and Africa.
IT Products: The Company is a value-added reseller of desktops, servers, notebooks, storage products, networking solutions and packaged software for leading international brands. In certain total outsourcing contracts of the IT Services segment, the Company delivers hardware, software products and other related deliverables. Revenue relating to the above items is reported as revenue from the sale of IT Products.
Reconciliation of selected GAAP measures to Non-GAAP measures
Reconciliation of Non-GAAP Constant Currency IT Services Revenue to IT Services Revenue as per IFRS ($Mn)
| Three Months ended March 31, 2024 | |
| IT Services Revenue as per IFRS | $2,657.4 |
| Effect of Foreign currency exchange movement | ($8.5) |
| Non-GAAP Constant Currency IT Services Revenue based on previous quarter exchange rates | $2,648.9 |
| Three Months ended March 31, 2024 | |
| IT Services Revenue as per IFRS | $2,657.4 |
| Effect of Foreign currency exchange movement | ($4.4) |
| Non-GAAP Constant Currency IT Services Revenue based on exchange rates of comparable period in previous year | $2,653.0 |
| Year ended March 31, 2024 | |
| IT Services Revenue as per IFRS | $10,805.3 |
| Effect of Foreign currency exchange movement | ($61.0) |
| Non-GAAP Constant Currency IT Services Revenue based on previous quarter exchange rates | $10,744.4 |
Reconciliation of Free Cash Flow for three months and year ended March 31, 2024
| Amount in INR Mn | ||
| Three months ended | Year ended | |
| March 31, 2024 | March 31, 2024 | |
| Net Income for the period [A] | 28,582 | 111,121 |
| Computation of Free Cash Flow | ||
| Net cash generated from operating activities [B] | 52,179 | 176,216 |
| Add/ (deduct) cash inflow/ (outflow)on: | ||
| Purchase of property, plant and equipment | (4,248) | (10,510) |
| Proceeds from sale of property, plant and equipment | 119 | 4,022 |
| Free Cash Flow [C] | 48,050 | 169,728 |
| Operating Cash Flow as percentage of Net Income [B/A] | 182.6% | 158.6% |
| Free Cash Flow as percentage of Net Income [C/A] | 168.1% | 152.7% |
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