Moneycontrol
Last Updated : Jan 10, 2019 06:19 PM IST | Source: Moneycontrol.com

TCS Q3: Here are 10 key takeaways from December quarter earnings

The bottomline growth was driven by other income (up 59 percent QoQ), but limited by weak operational performance.

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Software firm Tata Consultancy Services on January 10 reported 2.6 percent sequential growth in December quarter profit at Rs 8,105 crore with constant currency revenue growth of 1.8 percent quarter-on-quarter (QoQ) meeting analyst expectations.

The bottomline growth was driven by other income (up 59 percent QoQ) but limited by weak operational performance. The company had reported a profit at Rs 7,901 crore in the quarter ended September 2018.

Revenue during the quarter grew 1.3 percent QoQ to Rs 37,338 crore in the October-December quarter.

Here are 10 key takeaways from the Q3 performance.

Net Profit

TCS reported 2.6 percent sequential growth in December quarter profit at Rs 8,105 crore driven by a 59 percent QoQ increase in other income, but limited by weak operational performance.

The constant currency revenue growth was 1.8 percent QoQ.

The company had reported profit of Rs 7,901 crore in the quarter ended September 2018.

Revenue

Revenue during the quarter grew 1.3 percent QoQ to Rs 37,338 crore in the October-December quarter.

The year-on-year (YoY) growth in profit was 24.1 percent, and revenue in constant currency terms increased 12.1 percent YoY, the highest in 14 quarters.

Revenue in Dollar terms:

Revenue in dollar terms was higher by 0.67 percent QoQ at $5,250 million in Q3FY19 and constant currency growth stood at 1.8 percent against 3.7 percent in the previous quarter.

Operational Numbers:

Operational performance for the quarter was weak as EBIT (earnings before interest & tax) declined 2.12 percent sequentially to Rs 9,564 crore in Q3FY18 and margin contracted to 25.6 percent against 26.5 percent in September quarter.

Dividend:

The Board of Directors at its meeting held on January 10, 2019, declared an interim dividend of ~ 4.00 per equity share.

Performance of business verticals:

BFSI revenue grew 0.5 percent QoQ to Rs 14,722 crore, while its EBIT fell 4 percent to Rs 4,021 crore.

Manufacturing revenue grew 1 percent to Rs 3,958 crore against Rs 3,919 crore during the previous quarter. Manufacturing EBIT grew 6.6 percent at Rs 1,162 crore.

Retail revenue has grown 1.6 percent at Rs 6,994 crore against RS 6,348 crore quarter on quarter. Retail EBIT fell 4 percent at Rs 1,726 crore quarter on quarter.

The communication and media revenue rose 1 percent at Rs 6,090 crore against Rs 6,009 crore QoQ.

Employees Additions/Attrition:

Net addition in Q3 was 6,827 employees, bringing the total employee strength at the end of Q3 to 417,929 on a consolidated basis. The percentage of women in the workforce rose further to 35.8 percent, while the total number of nationalities represented grew to 151.

Growth in geographical markets:

Revenue growth accelerated in all the geographies compared to Q2. Growth was led by UK (+25.1 percent), Europe (+17.6 percent), and Asia Pacific (+12.6 percent). North America grew 8.2 percent, India grew 9.7 percent and Latin America grew 7.6 percent.

Patents:

The company applied for 4,354 patents, including 169 applied during the quarter and has been granted 855 patents.

Acquisition

TCS acquired W12 Studios, an award-winning digital design studio based in London. It paid Rs 66 crore to acquire 100 percent equity of W12 Studios.
First Published on Jan 10, 2019 06:19 pm

tags #Results #TCS

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