Infosys Q4FY18 performance meets street estimates

For fiscal year 2018, Infosys’ revenues in dollar terms grew by 7.2 per cent which seems to be in line with company’s guidance of 6.5 to 7.5 per cent. Further, in constant currency terms, revenues increased by 5.8 per cent in line with guidance of 5.5 to 6.5 per cent. On the margin front, the guidance was at 23 to 25 per cent and the company clocked operating margin of 24.3 per cent for FY18.

Infosys' consolidated results for the fourth quarter of FY18 came in line with street estimates. The company’s consolidated revenue for the quarter came in at Rs 18083 crore (street estimates Rs 18140 crore), registering 1.62 per cent QoQ increase. Besides, revenues from digital service was at USD 2.79 billion (25.5 per cent of total revenues) for FY18, which represents growth of 3.6 per cent QoQ in constant currency terms.
  
The company's EBITDA for the quarter rose by 2.35 per cent QoQ to Rs. 4930 crore (estimates Rs 4416 crore) with a corresponding margin expansion of 19 bps. Its EBITDA margin for the quarter stood at 27.26 per cent.
  
However, Infosys reported 28.06 per cent decline in its PAT to Rs 3690 crore (estimates Rs. 3679 crore). This was due to higher base of last quarter, led by reversal of tax provision.
  
While giving outlook for ongoing financial year 2019, the company expects revenues to grow at 6 to 8 per cent in constant currency terms and 7 to 9 per cent in dollar terms.
  
Infosys also informed that it is looking for potential buyer to sell its subsidiaries Kallidus (Panaya) and Skava. The company expects to get these deals completed by the end of FY19. On the other hand, it entered into a definitive agreement to acquire WongDoody Holding Company, a US-based digital creative and consumer insights agency.

The company's board of directors has recommended a final dividend of Rs 20.50 per equity share for the FY18 and special dividend of Rs 10 per equity share.