Wipro Limited Announces Results for the Quarter and Year Ended March 31, 2021 Under IFRS

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Business Wire India

  • IT Services Revenue growth for the quarter at 3.9% QoQ
  • EPS for the year increased by 14.6% YoY

Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for the Quarter and Year ended March 31, 2021.
 
Highlights of the Results
 
Results for the Quarter ended March 31, 2021:

  • Gross Revenue was Rs 162.5 billion ($2.2 billion1), an increase of 3.4% YoY
  • IT Services Segment Revenue was at $2,152.4 million, an increase of 3.9% QoQ and 3.8% YoY
  • Non-GAAP2 constant currency IT Services Segment Revenue increased by 3.0% QoQ and 0.5% YoY
  • IT Services Operating Margin3 for the quarter was at 21.0%, an expansion of 344 bps YoY
  • Net Income for the quarter was Rs 29.7 billion ($406.4 million1), an increase of 27.8% YoY
  • Earnings Per Share for the quarter was at Rs 5.39 ($0.071), an increase of 31.8% YoY

 
Results for the Year ended March 31, 2021:

  • Gross Revenue was Rs 619.4 billion ($8.5 billion1), an increase of 1.5% YoY
  • IT Services Segment Revenue was at $8,136.5 million, a decrease of 1.4% YoY
  • Non-GAAP2 constant currency IT Services Segment Revenue decreased by 2.3% YoY
  • IT Services Operating Margin3 for the year was at 20.3%, an expansion of 218 bps YoY
  • Net Income for the year was Rs 107.9 billion ($1,475.9 million1), an increase of 11.0% YoY
  • Earnings Per Share for the year was at Rs 19.11 ($0.261), an increase of 14.6% YoY
  • Operating Cash Flow was at Rs 147.6 billion ($2,017.4 million1), an increase of 46.6% YoY, which is 136.7% of Net Income

 
Performance for the quarter and year ended March 31, 2021
 
Thierry Delaporte, CEO and Managing Director said, “I am delighted with the way we have finished the financial year. We delivered a third consistent quarter of strong revenue growth, deal wins and operating margins. We also announced our largest ever acquisition of Capco that will bolster our global financial services sector. We are excited with this wave of business momentum that we are witnessing. All key markets are now growing on YoY basis and this provides us a solid foundation to build on next year growth rates.”
 
Jatin Dalal, Chief Financial Officer said, “We delivered a 340 bps expansion YoY in operating margins for the quarter after absorbing the impact of wage hike. On a full year basis we increased margins by 220 bps with a consistent improvement in operating metrics. Led by disciplined execution, we generated strong operating cash flows at 136.7% of our net income for the full year. We successfully completed the share buyback program returning $1.3Bn to our shareholders.”
 
Outlook for the quarter ending June 30, 2021

We expect Revenue from our IT Services business to be in the range of $2,195 million to $2,238 million*. This translates to a sequential growth of 2.0% to 4.0%. This does not include revenue from our recently announced acquisitions of Capco and Ampion
 
* Outlook is based on the following exchange rates: GBP/USD at 1.39, Euro/USD at 1.20, AUD/USD at 0.78, USD/INR at 72.76 and CAD/USD at 0.78
 
Capital Allocation

 
  • In the quarter ended March 31, 2021, the Company has concluded the buyback of 237.5 million equity shares as approved earlier by the Board of Directors at their meeting held on October 13, 2020 for an aggregate amount of Rs 95 billion ($1.3 billion1), excluding buyback tax
  • The interim dividend of Rs 1 declared by the Board at its meeting held on January 13, 2021 shall be considered as the final dividend for the financial year 2020-21

 
IT Services

Wipro continued its momentum in winning large deals with our customers as described below:

 
  • Wipro has won a multi-million-dollar integrated engagement from a leading US-based industrial manufacturing company to transform and modernize its business functions and enable it to become a digital enterprise via transformation in applications, infrastructure, cyber security and service delivery.
  • Wipro has won a multi-year strategic contract from a US-based digital transformation and consulting agency to provide Infrastructure Managed Services for its Data Center, and Network and Tools landscape. Wipro will leverage AI Ops tool stack to automate the client’s infrastructure to reduce turnaround time across requests and incidents, improve operational efficiency, and deliver a superior user experience for its end customer, a leading US-based Federal agency.

 
Digital Services Highlights

We continue to see increasing traction in digital oriented and other strategic deals as illustrated below:
 

  • A leading Indian e-commerce and technology company has selected Wipro to enhance customer experience, leveraging its expertise in digital operations and new-age solutions.
  • A leading technology provider has awarded Wipro a contract to consolidate its enterprise digital assets on cloud and on-premise to a centralized content repository to enable robust management of its marketing content needs.
  • A global communications and networking giant has extended their decade-long partnership with Wipro Designit to research, prototype, and design their major product family, as well as associated services and experience.
  • Wipro has won a multi-year engagement with a US-based utilities company to provide System Integrator services for a large business and IT transformation program in the areas of Supply Chain and Enterprise Work and Asset Management. Wipro will leverage its strong domain expertise and capabilities in Digital, Applications, and Data and Analytics to implement leading practices and business processes across the enterprise.
  • A multinational professional services company has engaged Wipro Designit to design next generation, user-centric experience for its employees. Designit will apply research, service design blueprinting and experience design to transform the workplace and the computing experience for the client’s global workforce.

Analyst Recognition
 

  • Wipro was positioned as a Leader in Gartner Magic Quadrant for Managed Workplace Services, North America, Daniel Barros, Mark Ray, Stephanie Stoudt-Hansen, Tobi Bet, 24 Feb 2021
  • Wipro was positioned as a Leader in Gartner Magic Quadrant for Managed Workplace Services, Europe, David Groombridge, Claudio Da Rold, Alexandra Chavez, Daniel Barros, Katja Ruud, 24 Feb 2021
  • Wipro was positioned as a Leader in Gartner Magic Quadrant for Customer Service BPO, Deborah Alvord, Kim Dans, Philip Jenkins, John Quaglietta, TJ Singh, 9 Feb 2021
  • Wipro ranks among the Top Service Providers in Customer Satisfaction Category in Whitelane / Quint Netherlands IT Outsourcing Study 2021
  • Wipro ranks among the Top Service Providers in Customer Satisfaction Category in Whitelane & PA Consulting IT Outsourcing Study 2021 in Nordics Region
  • Wipro was positioned as a Leader in Everest Group’s Pharmacovigilance and Complaint Management Operations Services PEAK Matrix® Assessment 2021
  • Wipro was recognized as a Leader in Everest Group’s Intelligent Process Automation (IPA) Solutions PEAK Matrix® Assessment 2021
  • Wipro was recognized as a Leader in Everest Group’s Semiconductor Engineering Services PEAK Matrix® Assessment 2021
  • Wipro was rated as a Leader in ISG Provider Lens™ Salesforce Ecosystem Partners 2021 – US
  • Wipro was rated as a Leader in ISG Provider Lens™ Next-gen Application Development & Maintenance (ADM) Services 2020 – US and UK

Disclaimer: 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 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.

IT Products

  • IT Products Segment Revenue for the year was Rs 7.7 billion ($105.1 million1)
  • IT Products Segment Results for the year was a profit of Rs 0.05 billion ($0.62 million1)
  • IT Products Segment Revenue for the quarter was Rs 2.1 billion ($28.9 million1)
  • IT Products Segment Results for the quarter was a profit of Rs 0.15 billion ($2.0 million1)

 
India business from State Run Enterprises (ISRE)

  • India SRE Segment Revenue for the year was Rs 8.9 billion ($121.8 million1)
  • India SRE Segment Results for the year was a profit of Rs 1.1 billion ($14.5 million1)
  • India SRE Segment Revenue for the quarter was Rs 2.3 billion ($31.5 million1)
  • India SRE Segment Results for the quarter was a profit of Rs 0.6 billion ($8.0 million1)

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 Non-GAAP Financial Measures

This press release contains 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.
 
This non-GAAP financial measure is 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. In addition to this non-GAAP measure, 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, 2021, prepared under IFRS, along with individual business segment reports, are available in the Investors section of our website www.wipro.com

Quarterly Conference Call

We will hold an earnings conference call today at 07:15 p.m. Indian Standard Time (09:45 a.m. U.S. Eastern Time) to discuss our performance for the quarter. The audio from the conference call will be available online through a web-cast and can be accessed at the following link- https://links.ccwebcast.com/?EventId=WIPRO210415

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 global information technology, consulting and business process services company. We harness the power of cognitive computing, hyper-automation, robotics, cloud, analytics and emerging technologies to help our clients adapt to the digital world and make them successful. A company recognized globally for its comprehensive portfolio of services, strong commitment to sustainability and good corporate citizenship, we have over 190,000 dedicated employees serving clients across six continents. Together, we discover ideas and connect the dots to build a better and a bold new future.
 
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, 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.            
                                

  1. For the convenience of the readers, the amounts in Indian Rupees in this release have been translated into United States Dollars at the certified foreign exchange rate of US$1 = Rs 73.14, as published by the Federal Reserve Board of Governors on March 31, 2021. However, the realized exchange rate in our IT Services business segment for the quarter ended March 31, 2021 was US$1= Rs 73.83
  2. Constant currency revenue for a period is the product of volumes in that period times the average actual exchange rate of the corresponding comparative period
  3. IT Services Operating Margin refers to Segment Results Total as reflected in IFRS financials

 

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, 2020   As at March 31, 2021  
               Convenience translation into US dollar in millions
Refer footnote 1
ASSETS              
Goodwill     131,012   139,127   1,902
Intangible assets     16,362   13,085   179
Property, plant and equipment     81,120   85,192   1,165
Right-of-Use assets     16,748   16,420   225
Financial assets              
Derivative assets       16    ^
Investments     9,302   10,576   145
Trade receivables     6,049   4,358   60
Other financial assets     5,881   6,088   83
Investments accounted for using the equity method     1,383   1,464   20
Deferred tax assets     6,005   1,664   23
Non-current tax assets     11,414   14,323   196
Other non-current assets     11,935   15,935   217
Total non-current assets     297,211   308,248   4,215
Inventories     1,865   1,064   15
Financial assets              
Derivative assets     3,025   4,064   56
Investments     189,635   175,707   2,402
Cash and cash equivalents     144,499   169,793   2,321
Trade receivables     104,474   94,298   1,289
Unbilled receivables     25,209   27,124   371
Other financial assets     8,614   7,245   99
Contract assets     17,143   16,507   226
Current tax assets     2,882   2,461   34
Other current assets     22,505   24,923   340
Total current assets     519,851   523,186   7,153
               
TOTAL ASSETS     817,062   831,434   11,368
               
EQUITY              
Share capital     11,427   10,958   150
Share premium     1,275   714   10
Retained earnings     476,103   466,692   6,381
Share-based payment reserve     1,550   3,071   42
SEZ Re-investment reserve     43,804   41,154   563
Other components of equity     23,299   30,506   418
Equity attributable to the equity holders of the Company     557,458   553,095   7,564
Non-controlling interests     1,875   1,498   20
TOTAL EQUITY     559,333   554,593   7,584
               
LIABILITIES              
Financial liabilities              
Loans and borrowings     4,840   7,458   102
Derivative liabilities       138    
Lease liabilities     12,638   13,513   185
Other financial liabilities     151   2,291   31
Deferred tax liabilities     2,825   4,633   63
Non-current tax liabilities     13,205   11,069   151
Other non-current liabilities     7,537   7,835   107
Provisions     2   2    ^
 Total non-current liabilities     41,336   46,801   639
Financial liabilities              
Loans, borrowings and bank overdrafts     73,202   75,874   1,037
Derivative liabilities     7,231   1,070   15
Trade payables and accrued expenses     78,129   78,870   1,078
Lease liabilities     6,560   7,669   105
Other financial liabilities     899   1,470   20
Contract liabilities     18,775   22,535   308
Current tax liabilities     11,731   17,324   237
Other current liabilities     19,254   24,552   336
Provisions     612   676   9
Total current liabilities     216,393   230,040   3,145
TOTAL LIABILITIES     257,729   276,841   3,784
               
TOTAL EQUITY AND LIABILITIES     817,062   831,434   11,368
^ 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,  
      2020   2021   2021   2020   2021   2021  
              Convenience translation into US dollar in millions
Refer footnote 1
          Convenience translation into US dollar in millions
Refer footnote 1
 
Revenues     157,110   162,454   2,221   610,232   619,430   8,469  
Cost of revenues     (114,133)   (109,805)   (1,501)   (436,085)   (423,205)   (5,786)  
Gross profit     42,977   52,649   720   174,147   196,225   2,683  
                             
Selling and marketing expenses     (10,295)   (10,679)   (146)   (42,907)   (41,400)   (566)  
General and administrative expenses     (7,681)   (8,689)   (119)   (29,823)   (34,686)   (474)  
Foreign exchange gains     993   886   12   3,169   2,995   41  
Other operating income/(loss), net     395       1,144   (81)   (1)  
Results from operating activities     26,389   34,167   467   105,730   123,053   1,683  
                             
Finance expenses     (1,653)   (1,122)   (15)   (7,328)   (5,088)   (70)  
Finance and other income     4,907   4,447   61   24,081   20,912   286  
Share of net profit /(loss) of associates accounted for using the equity method     13   4    ^   29   130   2  
Profit before tax     29,656   37,496   513   122,512   139,007   1,901  
Income tax expense     (6,205)   (7,755)   (106)   (24,799)   (30,345)   (415)  
Profit for the period     23,451   29,741   407   97,713   108,662   1,486  
                             
Profit attributable to:                            
Equity holders of the Company     23,260   29,721   407   97,218   107,946   1,476  
Non-controlling interests     191   20    ^   495   716   10  
Profit for the period     23,451   29,741   407   97,713   108,662   1,486  
                             
Earnings per equity share:                            
Attributable to equity holders of the Company                            
Basic     4.09   5.39   0.07   16.67   19.11   0.26  
Diluted     4.07   5.38   0.07   16.62   19.07   0.26  
                             
Weighted average number of equity shares                            
used in computing earnings per equity share                            
Basic     5,692,835,298   5,510,335,838   5,510,335,838   5,833,384,018   5,649,265,885   5,649,265,885  
Diluted     5,703,378,727   5,524,619,810   5,524,619,810   5,847,823,239   5,661,657,822   5,661,657,822  
^ Value is less than 1                            

 
 
Additional Information:
 

Particulars Three months ended Year ended
March 31,
2021
December 31,
2020
March 31,
2020
March 31,
2021
March 31,
2020
Audited  Audited  Audited  Audited  Audited
Revenue          
IT Services          
Americas 1 46,510 45,015 45,977 178,091 176,115
Americas 2 46,475 44,702 45,418 179,821 181,481
Europe 45,107 42,880 41,104 165,441 157,526
APMEA 20,825 20,717 20,395 82,462 78,676
Total of IT Services 158,917 153,314 152,894 605,815 593,798
IT Products 2,117 1,563 3,266 7,685 11,657
ISRE 2,302 2,388 1,931 8,912 7,950
Reconciling Items 4 1 12 13 (4)
Total Revenue 163,340 157,266 158,103 622,425 613,401
           
Other operating income/(loss), net          
IT Services 395 (81) 1,144
Total Other operating income/(loss), net 395 (81) 1,144
           
Segment Result          
IT Services          
Americas 1 9,863 8,095 7,324 33,040 27,289
Americas 2 10,500 10,216 9,008 41,589 34,341
Europe 8,704 9,251 7,181 31,673 27,617
APMEA 3,074 2,765 2,426 11,476 9,550
   Unallocated 1,257 2,944 609 5,153 7,732
Other operating income/(loss), net 395 (81) 1,144
Total of IT Services 33,398 33,271 26,943 122,850 107,673
IT Products 145 78 145 45 (323)
ISRE 587 471 (510) 1,061 (1,849)
Reconciling Items 37 (7) (189) (903) 229
Total 34,167 33,813 26,389 123,053 105,730
Finance Expense (1,122) (1,400) (1,653) (5,088) (7,328)
Finance and Other Income 4,447 5,975 4,907 20,912 24,081
Share of net profit/ (loss) of associates accounted for using the equity method 4 101 13 130 29
Profit before tax 37,496 38,489 29,656 139,007 122,512

 
 
The Company is organized into the following operating segments: IT Services, IT Products and India State Run Enterprise segment (ISRE).
 
IT Services: As announced on November 12, 2020, effective January 1, 2021, the Company re-organized IT Services segment.to 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 United Kingdom and Ireland, Switzerland, Germany, Benelux, Nordics and Southern Europe. APMEA consists of Australia and New Zealand, India, Middle East, South East 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.
 
India State Run Enterprise segment (ISRE): This segment consists of IT Services offerings to entities/ departments owned or controlled by the Government of India and/ or any State Governments.
 
Reconciliation of Non-GAAP Constant Currency IT Services Revenue to IT Services Revenue as per IFRS ($Mn)
 

                          Three Months ended March 31, 2021

IT Services Revenue as per IFRS                                                           $         2,152.4
Effect of Foreign currency exchange movement                                      $            (18.7)
Non-GAAP Constant Currency IT Services Revenue based on               $         2,133.7
previous quarter exchange rates                     
 
                        Three Months ended March 31, 2021
IT Services Revenue as per IFRS                                                         $         2,152.4
Effect of Foreign currency exchange movement                                   $             (68.8)
Non-GAAP Constant Currency IT Services Revenue based on            $         2,083.6
exchange rates of comparable period in previous year  
 
 
                        Year ended March 31, 2021
IT Services Revenue as per IFRS                                                          $         8,136.5
Effect of Foreign currency exchange movement                                    $             (72.2)
Non-GAAP Constant Currency IT Services Revenue based on             $         8,064.4
exchange rates of comparable period in previous year