Industry Summary Articles

Wipro Limited, a leading technology services and consulting company, announced financial results under International Financial Reporting Standards (IFRS) for the quarter and year ended March 31, 2023.

Highlights of the Results

Results for the Quarter ended March 31, 2023:

1. Gross Revenue reached ₹231.9 billion ($2.8 billion¹), a decrease of 0.2% QoQ, increased 11.2% YoY
2. IT Services Segment Revenue increased to $2,823.0 million, an increase of 0.7% QoQ and 3.7% YoY
3. Non-GAAP² constant currency IT Services segment revenue decreased 0.6% QoQ, increased 6.5% YoY
4. Total Bookings⁴ were up by 29% and large deal bookings⁵ were up by 155% YoY
5. IT Services Operating Margin³ for the quarter was at 16.3%, flat QoQ
6. Net Income for the quarter was at ₹30.7 billion ($374.1 million¹), an increase of 0.7% QoQ and decrease of 0.4% YoY
7. Earnings Per Share for the quarter was at ₹5.61 ($0.07¹), an increase of 0.7% QoQ and decrease of 0.5% YoY
8. Operating Cash Flows at 120.6% of Net Income for the quarter was at ₹37.3 billion ($453.8 million¹), an increase of 60.0% YoY 
9. Voluntary attrition⁶ decreased 330 bps from the previous quarter, landing at 14.1% on a quarterly annualised basis and at 19.2% on a trailing twelve months basis

Results for the Year ended March 31, 2023:

1. Gross Revenue reached ₹904.9 billion ($11.0 billion¹), an increase of 14.4% YoY
2. IT Services Segment Revenue increased to $11,159.7 million, an improvement of 7.8% YoY
3. Non-GAAP² constant currency IT Services segment revenue was up 11.5% YoY
4. IT Services Operating Margin³ for the year was at 15.7%, a decrease of 205bps YoY
5. IT Services Operating profit was higher than any previous period at ₹140.8 billion, an improvement of 1.2% YoY
6. Earnings Per Share for the year was at ₹20.73 ($0.25¹), a decrease of 7.2% YoY
7. Operating Cash Flows at 114.9% of Net Income for the year was at ₹130.6 billion ($1,589.0 million¹), an increase of 17.9% YoY 

Performance for the Quarter and Year ended March 31, 2023

Thierry Delaporte, CEO and Managing Director, said, “We closed FY23 with the strongest-ever bookings recorded in a year. We delivered two consecutive quarters of total bookings of over $4.1 billion. Our large deal order booking grew by 155% year-over-year for the quarter. We are also pleased to announce our share buyback, which is part of our philosophy to deliver consistent returns to shareholders.

“Compared to just a few years ago, we are seeing a visible change in the structure of our deals and our market position. We are winning large transformation deals, benefitting from a consolidating market, and deepening relationships with existing clients.”

“We have built a strong foundation to sustain through this period of increased uncertainty. We have the growth mindset, right organizational structure, and the talent for long-term success.”

Jatin Dalal, Chief Financial Officer, said, “We continue to maintain our focus on operational improvements and productivity enhancements which led to our IT services margin exit at 16.3% in Q4 despite macro headwinds. We generated strong operating cash flows at 121% of our net income for the Quarter.”

Outlook for the Quarter ending June 30, 2023

We expect Revenue from our IT Services business including India State Run Enterprise (ISRE) segment to be in the range of $2,753 million to $2,811 million*. This translates to sequential guidance of -3.0% to -1.0% in constant currency terms.

* Outlook for the Quarter ending June 30, 2023, is based on the following exchange rates: GBP/USD at 1.22, Euro/USD at 1.07, AUD/USD at 0.68, USD/INR at 81.74 and CAD/USD at 0.74

Capital Allocation

The Board of Directors approved a buyback proposal, subject to the approval of shareholders through postal ballot, for purchase by the Company of up to 269,662,921 equity shares of ₹ 2 each (being 4.91% of total paid-up equity shares) from the shareholders of the Company on a proportionate basis by way of a tender offer at a price of ₹ 445 ($5.41¹) per equity share for an aggregate amount not exceeding ₹ 120 billion ($1.5 billion¹) , in accordance with the provisions contained in the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018 and the Companies Act, 2013 and rules made thereunder.

The interim dividend of ₹1 declared by the Board at its meetings held on January 13^th, 2023, shall be considered as the final dividend for the financial year 2022-23.

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 = ₹82.19, as published by the Federal Reserve Board of Governors on March 31, 2023. However, the realized exchange rate in our IT Services business segment for the quarter ended March 31, 2023 was US$1= ₹81.63
2. Constant currency 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
4. Total Bookings refers to the total contract value of all orders that were booked during the period including new orders, renewals, and increases to existing contracts. Bookings do not reflect subsequent terminations or reductions related to bookings originally recorded in prior fiscal periods. Bookings are recorded using then-existing foreign currency exchange rates and are not subsequently adjusted for foreign currency exchange rate fluctuations. The revenues from these contracts accrue over the tenure of the contract. For constant currency growth rates, refer note 2
5. Large deal bookings consist of deals greater than or equal to $30 million in total contract value
6. Voluntary attrition is in IT Services and excludes DOP measured for the trailing twelve months

Highlights of Strategic Deal Wins

In the fourth quarter, Wipro continued to win large and strategic deals across industries. Key highlights include:

• A US-based healthcare company selected Wipro to transform its technology-enabled health services business and supercharge growth. Wipro will help reshape the end-to-end member, patient, and provider journey by building a standardized, interoperable, and integrated care delivery platform. The project will improve talent allocation as well as care coordination, reducing costs, increasing effectiveness and, ultimately, improving the quality of healthcare.
• A US-based multinational apparel and fashion major selected Wipro to spearhead end-to-end automation across its applications and infrastructure landscape globally. Wipro will offer a range of services including business and technical support to manage various business process areas, data center operations, and network and voice services. This will help the client achieve 30% automation, cost optimization, and improve end-user experience.
• Wipro was selected in a strategic, multi-year engagement by a global personal care and home products distribution company to deliver enhanced business experience to the client. An integrated delivery model powered by SmartOps will provide round the clock proactive and preventative support for business-critical applications. This will help the client drive higher application stability and minimize related problems that hinder business operations.
• Wipro won a multi-year engagement with a leading Europe-based communications group to accelerate global deployment of their enterprise software platform for business operations. The goal of this program is to rollout a core model template, localize, integrate, and conduct change management for a consistent process across front office and operations in Finance, Procurement, Projects, Analytics, and Reporting. This will enable the client to synchronize their business processes, decommission existing local systems, innovate, and enhance user experience across regions.
• A UK-based health insurer selected Wipro to consolidate and transform the business process services for its international private medical insurance business. Wipro will set up a global servicing hub to provide experience and support services to clients, while driving operational efficiencies and maintaining compliance.
• A large, US-based life and annuities insurance firm selected Wipro to modernize their business, migrate existing workloads to cloud and offer infrastructure-as-a-service for their entire data center infrastructure. Wipro will also deliver enhanced employee experience through an integrated service desk, mainframe services while enhancing service levels, providing a secured environment through their identity and access managed services, as well as business continuity through disaster recovery services.
• A US-based multinational bank has selected Wipro to provide engineering and operations services to modernize its infrastructure across the globe. Wipro will deliver a simple, easy-to-access services platform that will enhance the user experience and maximize the technology solutions used across the company. The end-to-end platform management will drive new efficiencies and better productivity through automation and standardization of processes.
• Wipro signed a second eight-year large deal with a leading European outsourcing & facilities management company to digitise its core Finance & Accounting systems and processes. Wipro will leverage Lab45 as a strategic technology & innovation hub to foster and accelerate automation, digitisation, and transformation of client’s service propositions and delivery models.

 IT Products

• IT Products segment revenue for the quarter was ₹1.1 billion ($13.8 million¹)
• IT Products segment results for the quarter was a loss of ₹0.06 billion ($0.7 million¹)
• IT Products segment revenue for the year was ₹6.0 billion ($73.6 million¹)
• IT Products segment results for the year was a loss of ₹0.18 billion ($2.1 million¹)

 India business from State Run Enterprises (ISRE)

• India SRE segment revenue for the quarter was ₹1.3 billion ($16.0 million¹)
• India SRE segment results for the quarter was a profit of ₹0.02 billion ($0.2 million¹)
• India SRE segment revenue for the year was ₹5.8 billion ($70.8 million¹)
• India SRE segment results for the year was a profit of ₹0.4 billion ($5.4 million¹)

Please refer to the table on page 11 for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.

Quarterly Conference Call

We will hold an earnings conference call today at 07:30 p.m. Indian Standard Time (10:00 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=WIP270423

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

To view the original press release, please click here.

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