- Q2 Revenue +4.8% QoQ in CC, +7.2% in USD, +4.7% in INR
- Growth led by BFSI (+6.2% QoQ) and Retail (+8.8% QoQ)
- Salary Increases to be Rolled Out, Effective October 1st
- Industry-leading Operating Margin at 26.2%*
- Very Strong Deal Closures: Total Contract Value of $8.6 Bn
- Board Announces $2.18 Bn buyback
MUMBAI, October 7, 2020: Tata Consultancy Services (BSE: 532540, NSE: TCS), the leading global IT services, consulting and business solutions organization, reported its consolidated financial results according to Ind AS and IFRS, for the quarter ending September 30, 2020.
Highlights of the Quarter Ended September 30, 2020
- Revenue at $5.424 Bn, +7.2% QoQ, -1.7% YoY
- Constant Currency revenue growth: +4.8% QoQ, –3.2% YoY
- Net Income at $1.14 Bn*, +23.4% QoQ, +0.2% YoY
- Operating Margin expands 2.2% YoY to 26.2%*; Net Margin at 21%*
- Strong Cash Conversion: Net Cash from Operations at $1.44 Bn | 125.9% of Net Income*
- Consolidated headcount: 453,540 | Net addition: 9,864 | Women in the workforce: 36.4%
- 352K+ employees trained in new technologies; 427K+ on Agile methods
- Already a global benchmark, IT Services attrition rate hits an all-time low at 8.9% LTM
- Capital Allocation:
- Interim Dividend per share: `12.00 | Record date 15/10/2020 | Payment date 03/11/2020
- The Board has approved a proposal to buy back up to 5,33,33,333 equity shares of TCS, being 1.42% of the total paid up equity share capital, at `3,000 per equity share for an aggregate amount not exceeding `16,000 crore (excluding taxes and related expenses), on proportionate basis under the tender offer route using the stock exchange mechanism, subject to approval of the members by means of a special resolution through a postal ballot.
* Excludes provision of $165 Mn towards legal claim
Commenting on the Q2 performance, Rajesh Gopinathan, Chief Executive Officer and Managing Director, said: “Driving accelerated business value realization of our customers’ digital investments has resulted in broad-based revenue growth. The strong order book, a very robust deal pipeline, and continued market share gains give us confidence for the future.”
He added: “What we are witnessing right now is the start of the first phase of a multi-year technology transformation cycle. In the current phase, enterprises are building a cloud-based foundation that will serve as a resilient, secure and scalable digital core. In subsequent phases, we will see the native capabilities of these platforms being utilized to create innovative new business models and differentiated customer experiences. Our investments in building deep expertise on these platforms, in research and innovation and in industry-specific solutions leveraging our contextual knowledge, position us very strongly to benefit fully from this secular demand driver.”
N Ganapathy Subramaniam, Chief Operating Officer & Executive Director, said: “Our all-round performance this quarter is a huge endorsement of the increased relevance of our services and solutions to our clients as they pivot from risk mitigation to long-term resilience powered by cloud, digital and simplification of working methods. Clients are partnering us to leverage our thought leadership in SBWS™, Vision 25 x 25™ and Location Independent Agile™ to build a resilient, adaptable and future-proof operating model.”
He added: “Accessibility and Touchless are becoming important attributes for solution design, and our products and platforms continue to gain traction. Besides core systems transformation, our Quartz Blockchain Solution is the choice of a leading bank and a market infrastructure player for inter-bank lending, crypto assets and for enabling real-time settlements.”
V Ramakrishnan, Chief Financial Officer, said: “We have always maintained that growth is the best margin lever, and that is very evident in our numbers this quarter. It is very gratifying to see every financial metric precisely where we would like it to be, with a stellar operating margin despite neutral currency, strong cash conversion, and lowest ever DSO. We continue to invest in our people and are doubling down on building newer capabilities to power the next leg of our growth and market share expansion.”
