<DOCUMENT>
<TYPE>EX-19.1
<SEQUENCE>3
<FILENAME>f85044exv19w1.txt
<DESCRIPTION>EXHIBIT 19.1
<TEXT>
<PAGE>
Exhibit 19.1
INFOSYS TECHNOLOGIES LIMITED
Report for the second quarter ended September 30, 2002
[INFOSYS LOGO]
<PAGE>
At a glance - Indian GAAP (Non-consolidated financials)
<TABLE>
<CAPTION>
Rs. in crore, except per share data
--------------------------------------------------------
Quarter ended Half year ended
September 30, September 30, Year ended
---------------- -------------------- March 31,
2002 2001 2002 2001 2002
------ ------ -------- -------- --------
<S> <C> <C> <C> <C> <C>
For the period
Total revenue 879.57 650.13 1,644.19 1,262.65 2,603.59
Export revenue 857.23 638.27 1,607.75 1,234.57 2,552.47
Operating profit (PBIDTA) 323.24 258.91 598.17 499.43 1,037.63
PBIDTA/ revenues(%) 36.75% 39.82% 36.38% 39.55% 39.85%
Profit after tax (PAT) 225.77 201.56 442.62 391.59 807.96
PAT/revenues(%) 25.67% 31.00% 26.92% 31.01% 31.03%
Earnings per share(*)(par value of
Rs. 5 each, fully paid)
Basic 34.10 30.47 66.87 59.19 122.12
Diluted 33.90 30.39 66.41 59.05 121.37
Dividend per share NA NA 12.50 7.50 20.00
Dividend amount NA NA 82.76 49.63 132.36
Capital expenditure 44.02 129.75 97.80 231.49 322.74
At the end of the period
Total assets 2,443.32 1,742.48 2,080.31
Fixed assets - net 753.53 713.65 718.24
Cash and cash equivalents 1,289.34 714.85 1,026.96
Working capital 1,623.01 965.75 1,293.41
Total debt -- -- --
Net worth 2,443.32 1,742.48 2,080.31
Equity 33.10 33.08 33.09
Market capitalization 22,552.46 15,878.57 24,654.33
</TABLE>
Note: Market capitalization is calculated by considering the share price at
National stock exchange on the shares outstanding at the period/ year end.
(*)EPS figures have been calculated for the period and have not been annualized.
Total Revenue
[PERFORMANCE GRAPH]
<TABLE>
<S> <C>
Year ended March 31, 2002 2,603.59
Quarter ended September 30, 2001 650.13
Quarter ended September 30, 2002 879.57
</TABLE>
Exports
[PERFORMANCE GRAPH]
<TABLE>
<S> <C>
Year ended March 31, 2002 2,552.47
Quarter ended September 30, 2001 638.27
Quarter ended September 30, 2002 857.23
</TABLE>
Net Profit from Ordinary Activities
[PERFORMANCE GRAPH]
<TABLE>
<S> <C>
Year ended March 31, 2002 807.96
Quarter ended September 30, 2001 201.56
Quarter ended September 30, 2002 225.77
</TABLE>
2
<PAGE>
Letter to the shareholder
Dear shareholder,
We are delighted to report another quarter of robust revenue growth. Our Indian
GAAP revenues grew by 15.03% over Q1 FY2003 while net profits from ordinary
activities witnessed an increase of 4.11%. Our cash flows during the quarter
amounted to Rs. 200.11 crore. Your company has declared an interim dividend of
Rs. 12.50 per share (250% on an equity share of par value of Rs. 5 each). Our
employee addition during this quarter has been the highest -- gross addition of
2,065 for the quarter, including 328 lateral hires; net employee addition for
the quarter stood at 1,806.
The economic environment continues to be very challenging. At the same time,
there is an increased acceptance of the offshore outsourcing model. Customers
are demanding more ROI and reduced risk. In this environment, our superior
delivery capabilities and financial strength have accelerated revenue growth
beyond our initial projections. In fact, we have increased our guidance for
revenue and EPS for this fiscal.
Our US GAAP revenues grew by 16.1% for the quarter as compared to the quarter
ended June 30, 2002. Revenue growth comprised of a volume growth of 11.7% and a
price growth of 4.4%, over the previous quarter.
Our utilization rates improved during the quarter and we were able to maintain
gross margins despite having an increased share of revenues from onsite work. We
enhanced our investments in sales and marketing and we are aggressively pursuing
our goal to be an integrated, end-to-end technology solutions provider.
We added 18 new clients during the quarter. Significant wins include marquee
names such as Porsche AG, the world leader in designing and manufacturing of
sports cars, Commonwealth Industries, an aluminum manufacturer in the US, Arrow
Electronics in the US, one of the world's largest distributors of electronic
components and computer products, Cerebrus Solutions, provider of fraud
management solutions for wireless operators, Vcommerce Corporation, a leading
supply chain execution solutions provider in the US and The Security Benefit
Group of Companies, one of the five largest asset management institutions in
Switzerland.
Our business consulting services continue to help companies obtain benefits
through enterprise-wide initiatives. We defined steps to improve operations and
to support expansion plans of the corporate finance division of one of the top
three banks in Australia. We created a divisional Balanced Scorecard for the
human resources and customer facing units of the fifth largest ocean
transportation company in the world.
Our banking business further strengthened its presence during the quarter. In
Nigeria, we have formed an alliance with Kakawa Discount, a discount house
formed by a consortium of key banks. In addition, First Bank of Nigeria, the
largest commercial bank in West Africa, signed up for our banking products.
Further, UTI Bank became the first client to sign up for the Infosys Loan
Origination system built on FINACLE(TM) CRM infrastructure.
During the quarter, Phaneesh Murthy resigned from the company's Board of
Directors and from his role as Head -- Sales & Marketing and Communications and
Product Services (CAPS) effective July 23, 2002. We appointed Basab Pradhan as
Senior Vice President and Head -- Worldwide Sales, taking over part of Phaneesh
Murthy's portfolio.
In the sexual harassment litigation that the company is facing, we initiated
voluntary settlement discussions with the plaintiff. However, it appears that
the settlement may not be possible in the near term and the lawsuit may go to
trial. No trial date has been set yet. We will vigorously defend this matter.
However, the results of such a lawsuit are difficult to predict. Accordingly, an
unfavorable resolution of this lawsuit could adversely impact our results of
operations or our financial condition.
During the quarter, we were assessed at Level 5 on the SEI PCMM model, becoming
the first company in the world to be assessed at the Optimizing level on the
updated version 2.0 of the model. The model helps us increase our ability to
attract, develop, motivate, organize and retain the talent needed to
continuously improve our software development capabilities.
Overall, it has been an exciting quarter of growth. Infoscions, through their
hard work and dedication have helped achieve this. On your behalf, we thank our
fellow Infoscions for their continuing efforts to delight our customers.
<TABLE>
<S> <C> <C>
/s/ S. GOPALAKRISHNAN /s/ NANDAN M. NILEKANI
---------------------------- ----------------------------------
Bangalore S. Gopalakrishnan Nandan M. Nilekani
October 10, 2002 Chief Operating Officer Chief Executive Officer, President
and Deputy Managing Director and Managing Director
</TABLE>
3
<PAGE>
Auditors' report
We have audited the attached Balance Sheet of Infosys Technologies Limited (the
Company) as at September 30, 2002, the Profit and Loss Accounts and Cash Flow
Statements of the Company for the quarter and half-year ended on that date,
annexed thereto. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards
in India. Those Standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
We report as follows:
(a) we have obtained all the information and explanations which to the best of
our knowledge and belief were necessary for the purposes of our audit;
(b) in our opinion, proper books of account have been kept by the Company so
far as appears from our examination of those books;
(c) the Balance Sheet and the Profit and Loss Accounts dealt with by this
report are in agreement with the books of account;
(d) in our opinion, the Balance Sheet, the Profit and Loss Accounts and the
Cash Flow Statements comply with the Accounting Standards issued by the
Institute of Chartered Accountants of India, to the extent applicable; and
(e) in our opinion and to the best of our information and according to the
explanations given to us, the said accounts give a true and fair view in
conformity with the accounting principles generally accepted in India:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at September 30, 2002;
(ii) in the case of the Profit and Loss Accounts, of the profit of the
Company for the quarter and half year ended on that date; and
(iii) in the case of the Cash Flow Statements, of the cash flows of the
Company for the quarter and half year ended on that date.
for Bharat S Raut & Co.
Chartered Accountants
S Balasubrahmanyam
Partner
Bangalore
October 10, 2002
4
<PAGE>
Balance sheet as at
<TABLE>
<CAPTION>
in Rs. crore
-------------------------------
September 30,
------------------- March 31,
2002 2001 2002
-------- -------- --------
<S> <C> <C> <C>
SOURCES OF FUNDS
SHAREHOLDERS' FUNDS
Share capital 33.10 33.08 33.09
Reserves and surplus 2,410.22 1,709.40 2,047.22
-------- -------- --------
2,443.32 1,742.48 2,080.31
======== ======== ========
APPLICATION OF FUNDS
FIXED ASSETS
Original cost 1,137.72 788.09 960.60
Less: Depreciation and amortization 476.54 310.63 393.03
-------- -------- --------
Net book value 661.18 477.46 567.57
Add: Capital work-in-progress 92.35 236.19 150.67
-------- -------- --------
753.53 713.65 718.24
INVESTMENTS 33.20 44.44 44.44
DEFERRED TAX ASSETS 33.58 18.64 24.22
CURRENT ASSETS, LOANS AND ADVANCES
Sundry debtors 458.25 343.60 336.73
Cash and bank balances 986.85 427.69 772.22
Loans and advances 870.16 623.26 643.87
-------- -------- --------
2,315.26 1,394.55 1,752.82
Less: Current liabilities 262.36 179.75 126.11
Provisions 429.89 249.05 333.30
-------- -------- --------
NET CURRENT ASSETS 1,623.01 965.75 1,293.41
-------- -------- --------
2,443.32 1,742.48 2,080.31
======== ======== ========
</TABLE>
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
The schedules referred to above and the notes thereon form an integral part of
the Balance sheet.
This is the Balance sheet referred to in our report of even date.
for Bharat S Raut & Co.
Chartered Accountants
<TABLE>
<S> <C> <C> <C> <C>
S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar
Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director
President and Managing Deputy Managing Director
Director
Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler
Director Director Director Director
Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal
Director Director Director Director
T. V. Mohandas Pai Srinath Batni V. Balakrishnan
Bangalore Director and Chief Director Company Secretary and
October 10, 2002 Financial Officer Vice President - Finance
</TABLE>
5
<PAGE>
Profit and loss account for the
<TABLE>
<CAPTION>
in Rs. crore except per share data
----------------------------------------------------------------------
Quarter ended Half year ended
September 30, September 30, Year ended
------------------------- -------------------------- March 31,
2002 2001 2002 2001 2002
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
INCOME
Software services and products
Overseas 857.23 638.27 1,607.75 1,234.57 2,552.47
Domestic 22.34 11.86 36.44 28.08 51.12
----------- ----------- ----------- ----------- -----------
879.57 650.13 1,644.19 1,262.65 2,603.59
SOFTWARE DEVELOPMENT EXPENSES 424.49 306.95 801.88 592.51 1,224.82
----------- ----------- ----------- ----------- -----------
GROSS PROFIT 455.08 343.18 842.31 670.14 1,378.77
SELLING AND MARKETING EXPENSES 69.33 33.46 124.42 61.11 129.79
GENERAL AND ADMINISTRATION EXPENSES 62.51 50.81 119.72 109.60 211.35
----------- ----------- ----------- ----------- -----------
131.84 84.27 244.14 170.71 341.14
OPERATING PROFIT (PBIDTA) 323.24 258.91 598.17 499.43 1,037.63
Interest -- -- -- -- --
Depreciation & amortization 46.24 39.01 86.71 74.49 160.65
----------- ----------- ----------- ----------- -----------
OPERATING PROFIT AFTER INTEREST,
DEPRECIATION AND AMORTIZATION 277.00 219.90 511.46 424.94 876.98
Other income 17.53 14.66 42.42 28.15 66.41
Provision for investments 23.76 -- 23.76 -- --
----------- ----------- ----------- ----------- -----------
PROFIT BEFORE TAX 270.77 234.56 530.12 453.09 943.39
Provision for taxation 45.00 33.00 87.50 61.50 135.43
----------- ----------- ----------- ----------- -----------
NET PROFIT AFTER TAX 225.77 201.56 442.62 391.59 807.96
----------- ----------- ----------- ----------- -----------
AMOUNT AVAILABLE FOR APPROPRIATION 225.77 201.56 442.62 391.59 807.96
----------- ----------- ----------- ----------- -----------
DIVIDEND
Interim 82.76 49.63 82.76 49.63 49.63
Final -- -- -- -- 82.73
Dividend Tax -- 5.06 -- 5.06 5.06
Amount transferred - general reserve -- -- -- -- 670.54
Balance in Profit and Loss Account 143.01 146.87 359.86 336.90 --
----------- ----------- ----------- ----------- -----------
225.77 201.56 442.62 391.59 807.96
=========== =========== =========== =========== ===========
EARNINGS PER SHARE (Equity shares, par value Rs. 5 each)
Basic 34.10 30.47 66.87 59.19 122.12
Diluted 33.90 30.39 66.41 59.05 121.37
Number of shares used in computing earnings per share
Basic 6,61,98,735 6,61,60,717 6,61,93,632 6,61,59,892 6,61,62,274
Diluted 6,65,96,469 6,63,34,606 6,66,51,932 6,63,12,732 6,65,67,575
=========== =========== =========== =========== ===========
</TABLE>
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
The schedules referred to above and the notes thereon form an integral part of
the Profit and Loss Account.
This is the Profit and Loss Account referred to in our report of even date.
For Bharat S. Raut & Co.
Chartered Accountants
<TABLE>
<S> <C> <C> <C> <C>
S. Balasubrahmanyam N.R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar
Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director
President and Managing Deputy Managing Director
Director
Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler
Director Director Director Director
Claude Smadja Rama Bijapurkar K. Dinesh S.D. Shibulal
Director Director Director Director
T.V. Mohandas Pai Srinath Batni V. Balakrishnan
Bangalore Director and Chief Director Company Secretary and
October 10, 2002 Financial Officer Vice President - Finance
</TABLE>
6
<PAGE>
Schedules to the profit and loss account for the
<TABLE>
<CAPTION>
in Rs. crore
----------------------------------------------------------------
Quarter ended Half year ended
September 30, September 30, Year ended
-------------------- -------------------- March 31,
2002 2001 2002 2001 2002
------ ------ ------ ------ -----------
<S> <C> <C> <C> <C> <C>
SOFTWARE DEVELOPMENT EXPENSES
Salaries and bonus including overseas staff expenses 343.27 242.54 640.92 466.98 976.11
Staff welfare 1.60 1.59 3.29 3.45 6.14
Contribution to provident and other funds 6.81 6.32 13.27 12.48 25.63
Foreign travel expenses 41.22 29.27 78.28 56.47 113.12
Consumables 1.26 0.69 2.42 1.08 3.22
Cost of software packages for
own use 11.30 9.10 21.06 17.06 34.44
service delivery to clients 0.74 2.04 7.62 6.05 9.17
Provision for post-sales client support (2.27) 0.95 (0.30) 1.05 3.65
Computer maintenance 2.52 1.72 4.38 2.90 7.11
Communication expenses 5.09 10.51 12.26 20.73 36.11
Consultancy charges 12.95 2.22 18.68 4.26 10.12
------ ------ ------ ------ ------
424.49 306.95 801.88 592.51 1,224.82
====== ====== ====== ====== ========
SELLING AND MARKETING EXPENSES
Salaries and bonus including overseas staff expenses 32.96 14.69 63.01 30.52 61.04
Staff welfare 0.18 0.05 0.31 0.17 0.27
Contribution to provident and other funds 0.15 0.06 0.24 0.08 0.22
Foreign travel expenses 9.90 3.94 18.59 7.49 18.66
Consumables 0.05 0.01 0.07 0.01 0.02
Cost of software packages for own use 0.02 0.04 0.03 0.07 0.58
Communication expenses 0.18 0.09 0.24 0.09 0.38
Traveling and conveyance 0.30 1.47 0.45 2.37 3.14
Rent 1.20 1.56 2.11 2.62 4.30
Telephone charges 1.46 0.79 2.52 1.52 3.26
Professional charges 2.97 1.45 5.24 2.11 5.90
Printing and stationery 0.40 0.37 0.77 0.74 1.55
Advertisements 0.24 0.03 0.40 0.03 0.31
Brand building 9.37 5.80 17.36 7.66 13.16
Office maintenance 0.35 0.06 0.50 0.13 0.31
Repairs to plant and machinery -- -- -- 0.01 0.01
Power and fuel 0.07 0.02 0.11 0.04 0.06
Insurance charges 0.01 -- 0.03 -- --
Rates and taxes 0.12 0.01 0.23 0.24 0.33
Bank charges and commission 0.03 0.01 0.04 0.02 0.03
Commission charges 4.70 1.49 6.22 2.01 10.82
Marketing expenses 2.20 1.11 3.31 2.65 4.67
Sales promotion expenses 0.05 0.10 0.20 0.21 0.44
Other miscellaneous expenses 2.42 0.31 2.44 0.32 0.33
------ ------ ------ ------ ------
69.33 33.46 124.42 61.11 129.79
====== ====== ====== ====== ======
</TABLE>
7
<PAGE>
Schedules to the profit and loss account for the
<TABLE>
<CAPTION>
in Rs. crore
--------------------------------------------------------------
Quarter ended Half year ended
September 30, September 30, Year ended
------------------- -------------------- March 31,
2002 2001 2002 2001 2002
----- ----- ----- ----- ---------
<S> <C> <C> <C> <C> <C>
GENERAL AND ADMINISTRATION EXPENSES
Salaries and bonus including overseas staff expenses 14.17 11.92 26.38 22.81 45.48
Contribution to provident and other funds 0.75 0.83 1.54 1.67 2.98
Foreign travel expenses 2.15 1.02 3.95 2.51 4.81
Traveling and conveyance 3.74 4.13 6.66 7.44 15.48
Rent 5.52 3.96 10.75 9.41 20.11
Telephone charges 5.37 3.25 9.01 6.76 11.45
Professional charges 7.98 3.29 14.51 6.48 16.23
Printing and stationery 1.01 0.65 2.66 3.42 4.75
Advertisements 1.02 0.81 1.67 1.42 2.78
Office maintenance 3.98 3.30 7.91 6.58 13.81
Repairs to building 1.15 1.57 3.02 3.79 8.50
Repairs to plant and machinery 0.93 0.78 2.09 1.26 2.48
Power and fuel 5.32 4.74 10.98 9.35 18.90
Insurance charges 2.48 1.22 4.46 2.50 5.34
Rates and taxes 1.10 1.02 2.27 1.69 3.93
Donations 1.37 1.56 3.04 3.99 5.12
Auditor's remuneration
audit fees 0.07 0.05 0.13 0.10 0.21
certification charges -- -- -- -- 0.02
out-of-pocket expenses -- 0.01 0.01 0.02 0.02
Bad loans and advances written off -- -- -- -- --
Bad debts written off -- -- -- -- --
Provision for bad and doubtful debts 0.11 3.53 0.18 10.47 13.09
Provision for doubtful loans and advances (0.01) 0.06 (0.05) 0.06 0.42
Bank charges and commission 0.16 0.08 0.32 0.12 0.68
Commission to non-whole time directors 0.24 0.24 0.48 0.48 0.98
Postage and courier 0.72 0.76 1.97 1.93 3.23
Books and periodicals 0.40 0.25 0.65 0.58 1.14
Research grants -- 0.25 -- 0.50 0.75
Freight charges 0.16 0.10 0.27 0.22 0.52
Professional membership and seminar participation fees 0.83 0.37 1.65 0.91 2.20
Transaction processing fee and filing fees 1.45 0.90 2.70 2.28 4.78
Other miscellaneous expenses 0.34 0.16 0.51 0.85 1.16
----- ----- ------ ------ ------
62.51 50.81 119.72 109.60 211.35
===== ===== ====== ====== ======
OTHER INCOME
Interest received on deposits with banks and others(*) 18.69 11.79 36.37 23.60 51.23
Miscellaneous income 0.47 0.31 1.18 0.73 1.92
Exchange differences (1.63) 2.56 4.87 3.82 13.26
----- ----- ----- ----- -----
17.53 14.66 42.42 28.15 66.41
===== ===== ===== ===== =====
(*) Tax deducted at source 3.21 2.08 6.43 3.79 8.28
PROVISION FOR TAXATION
Current period/year
Income taxes 53.74 35.05 96.86 64.61 143.19
Deferred taxes (8.74) (2.05) (9.36) (3.11) (7.76)
----- ----- ----- ----- ------
45.00 33.00 87.50 61.50 135.43
===== ===== ===== ===== ======
</TABLE>
8
<PAGE>
1. Extracts of significant accounting policies and notes on accounts
Company overview
Infosys Technologies Limited ("Infosys" or the "company"), a world leader in
consulting and information technology ("IT") services partners with Global 2000
companies to provide business consulting, systems integration, application
development, maintenance, re-engineering and product engineering services.
Through these services, Infosys enables its clients to fully exploit technology
for business transformation. Clients leverage Infosys' Global Delivery Model to
achieve higher quality, improved time-to-market and cost-effective solutions.
Management's Statement on significant accounting policies contained in the
audited financial statements.
There are no changes in the accounting policies during the quarter ended
September 30, 2002. The significant accounting policies of the company relate to
revenue recognition, expenditure, fixed assets and capital work-in -progress,
depreciation, retirement benefits to employees - principally gratuity,
superannuation and provident fund benefits, research and development, income
tax, earning per share, foreign currency transactions and investments.
1.1 Significant accounting policies
1.1.1 Basis of preparation of financial statements
The financial statements are prepared under the historical cost convention,
in accordance with Indian Generally Accepted Accounting Principles ("GAAP")
on the accrual basis. GAAP comprises mandatory accounting standards issued
by the Institute of Chartered Accountants of India ("ICAI") and the
provisions of the Companies Act, 1956. These accounting policies have been
consistently applied, except for applicable recently issued accounting
standards made mandatory by the ICAI effective the current fiscal year that
were adopted by the company, as described below. All amounts are stated in
Indian Rupees, except as otherwise specified.
Effective the current fiscal year, the company has voluntarily adopted the
applicable accounting standard on intangible assets, which is mandatory
effective the year commencing April 1, 2003. Management has also evaluated
the effect of the other recently issued accounting standards such as
discontinuing operations and reporting of interests in joint ventures
(although all these accounting standards are not mandatory for the fiscal
year ending 2003). These accounting standards do not have a material impact
on the financial statements of the company.
The preparation of the financial statements in conformity with GAAP requires
that the management of the company ("Management") make estimates and
assumptions that affect the reported amounts of income and expenses of the
period, reported balances of assets and liabilities and disclosures relating
to contingent assets and liabilities as of the date of the financial
statements. Examples of such estimates include expected development costs to
complete software contracts, provisions for doubtful debts, future
obligations under employee retirement benefit plans, income taxes, provision
for post sales customer support and the useful lives of fixed assets and
intangible assets. Actual results could differ from those estimates.
Contingencies are recorded when it is probable that a liability has been
incurred, and the amount can be reasonably estimated.
1.2 Notes on accounts
Pursuant to an application by the management, the Department of Company
Affairs in their letter of January 23, 2002 granted the company approval to
present the financial statements in Rupees crore. Accordingly, all amounts
in the financial statements are presented in Rupees crore, except for per
share data and as otherwise stated. All exact amounts are stated with the
suffix "/-". One crore equals 10 million.
The previous period's/year's figures have been regrouped/reclassified,
wherever necessary, to conform to the current period's/year's presentation.
1.2.1 Aggregate expenses
Following are the aggregate amounts incurred on certain specific expenses
that are required to be disclosed under Schedule VI to the Companies Act,
1956:
<TABLE>
<CAPTION>
Quarter ended Half year ended
September 30, September 30, Year ended
------------------- ------------------ March 31,
2002 2001 2002 2001 2002
------ ------ ------ ------ --------
<S> <C> <C> <C> <C> <C>
Salaries and bonus including overseas staff expenses 390.40 269.15 730.31 521.94 1,082.63
Staff welfare 1.78 1.64 3.60 1.98 6.41
Contribution to provident and other funds 7.71 7.21 15.05 14.22 28.83
Foreign travel expenses 53.27 34.23 100.82 66.47 136.59
Consumables 1.31 0.70 2.49 1.09 3.24
Cost of software packages for -- own use 11.32 9.14 21.09 17.13 35.02
Cost of software packages for service delivery to clients 0.74 2.04 7.62 6.05 9.17
Computer maintenance 2.52 1.72 4.38 2.90 7.11
Communication expenses 5.27 10.60 12.50 20.82 36.49
Consultancy charges 12.95 2.22 18.68 4.26 10.12
Provision for post-sales client support (2.27) 0.95 (0.30) 1.05 3.65
Traveling and conveyance 4.04 5.60 7.11 9.81 18.62
Rent 6.72 5.52 12.86 12.03 24.41
Telephone charges 6.83 4.04 11.53 8.28 14.71
Professional charges 10.95 4.74 19.75 8.60 22.13
Printing and stationery 1.41 1.02 3.43 4.16 6.30
Advertisements 1.26 0.84 2.07 1.45 3.09
Office maintenance 4.33 3.36 8.41 6.70 14.12
Repairs to building 1.15 1.57 3.02 3.79 8.50
Repairs to plant and machinery 0.93 0.78 2.09 1.27 2.49
Power and fuel 5.39 4.76 11.09 9.40 18.96
Brand building 9.37 5.80 17.36 7.66 13.16
Insurance charges 2.49 1.22 4.49 2.51 5.34
Rates and taxes 1.22 1.03 2.50 1.93 4.26
Commission charges 4.70 1.49 6.22 2.01 10.82
------ ------ ------ ------ --------
</TABLE>
9
<PAGE>
1.2.1 Aggregate expenses (continued)
<TABLE>
<CAPTION>
Quarter ended Half year ended
September 30, September 30, Year ended
------------------- -------------------- March 31,
2002 2001 2002 2001 2002
------ ------ -------- ------ --------
<S> <C> <C> <C> <C> <C>
Donations 1.37 1.56 3.04 3.99 5.12
Auditor's remuneration -- audit fees 0.07 0.05 0.13 0.10 0.21
certification charges -- -- -- -- 0.02
out-of-pocket expenses -- 0.01 0.01 0.01 0.02
Provision for bad and doubtful debts 0.11 3.53 0.18 10.47 13.09
Provision for doubtful loans and advances (0.01) 0.06 (0.05) 0.06 0.42
Bank charges and commission 0.19 0.09 0.36 0.14 0.71
Commission to non-whole time directors 0.24 0.24 0.48 0.48 0.98
Postage and courier 0.72 0.76 1.97 1.98 3.23
Books and periodicals 0.40 0.25 0.65 0.60 1.14
Research grants -- 0.25 -- 0.50 0.75
Freight charges 0.16 0.10 0.27 0.21 0.52
Professional membership and seminar participation fees 0.83 0.37 1.65 1.06 2.20
Marketing expenses 2.20 1.11 3.31 2.65 4.67
Sales promotion expenses 0.05 0.10 0.20 0.21 0.44
Transaction processing fee and filing fees 1.45 0.90 2.70 2.29 4.78
Other miscellaneous expenses 2.76 0.47 2.95 0.96 1.49
------ ------ -------- ------ --------
556.33 391.22 1,046.02 763.22 1,565.96
====== ====== ======== ====== ========
</TABLE>
1.2.2 Obligations on long-term non-cancelable operating leases
The lease rentals charged during the period and maximum obligations on
long-term non-cancelable operating leases payable as per the rentals stated
in the respective agreements are as follows:
<TABLE>
<CAPTION>
Quarter ended Half year ended
September 30, September 30, Year ended
------------- --------------- March 31,
2002 2001 2002 2001 2002
---- ---- ----- ----- ----------
<S> <C> <C> <C> <C> <C>
Lease rentals recognized during the period/year 6.72 5.52 12.86 12.03 24.41
---- ---- ----- ----- -----
Lease obligations
Within one year of the balance sheet date 16.83 15.90 16.95
Due in a period between one year and five years 39.00 54.72 46.90
Due after five years 5.98 15.08 7.20
---- ---- ----- ----- -----
</TABLE>
The operating lease arrangements extend for a maximum of ten years from
their respective dates of inception and relate to rented overseas premises.
Lease rental commitments on a contract with Progeon Limited ("Progeon"), a
subsidiary company, as at September 30, 2002 due to Infosys within one year
of the balance sheet date amounted to Rs. 1.64 and due in the period between
one year and five years amounted to Rs. 2.73. The lease for premises extends
for a maximum period of three years from quarter ended June 30, 2002 (the
period of inception).
Fixed Assets stated below have been provided on operating lease to Progeon,
which is under the same management, as at September 30, 2002:
<TABLE>
<CAPTION>
Particulars Original cost Accumulated depreciation Net book value
----------- ------------- ------------------------ --------------
<S> <C> <C> <C>
Building 9.59 0.27 9.32
Plant and machinery 2.42 0.27 2.15
Computers 0.78 0.12 0.66
Furniture & fixtures 1.74 0.26 1.48
----- ---- -----
Total 14.53 0.92 13.61
----- ---- -----
</TABLE>
The aggregate depreciation charged on the above assets for the quarter and
half-year ended September 30, 2002 amounted to Rs. 0.69 and Rs. 0.92
respectively. The rental income from Progeon for the quarter and half-year
ended September 30, 2002 amounted to Rs. 0.41 and Rs. 0.55 respectively.
1.2.3 Related party transactions
The company entered into related party transactions during the year ended
March 31, 2002 with Yantra Corporation, USA, the subsidiary of the company
until February 27, 2002, and key management personnel.
The transactions with Yantra Corporation comprise sales of Rs. 4.43 during
the period from April 1, 2001 until February 27, 2002. The outstanding dues
from Yantra Corporation as at September 30, 2002 were Rs.0.45. Such dues as
at September 30, 2001 were Rs.0.52 and as at March 31, 2002 were Rs. 0.34.
The company entered into related party transactions during the period ended
September 30, 2002 with Progeon, the subsidiary company, under the same
management. The transactions are set out below.
<TABLE>
<CAPTION>
Quarter ended Half year ended
Particulars September 30, 2002 September 30, 2002
----------- ------------------ -------------------
<S> <C> <C>
Capital transactions:
Financing transactions -- amount paid to Progeon for issue of
1,22,49,993 fully paid equity shares of Rs. 10/- each at par -- 12.25
---- -----
Revenue transactions:
Purchase of services 1.87 2.08
---- -----
Sale of services
Business consulting services 0.99 1.11
Shared services including facilities and personnel 1.64 2.37
---- -----
2.63 3.48
---- -----
</TABLE>
10
<PAGE>
During the quarter ended September 30, 2002 and half-year ended September
30, 2002 an amount of Rs. 1.28 and Rs. 2.53 respectively has been donated to
Infosys Foundation a not-for-profit trust, in which certain directors of the
company are trustees. Donation to the foundation for the quarter ended
September 30, 2001 half-year ended September 30, 2001 and year ended March
31, 2002 were Rs. 1.00, Rs. 3.00 and Rs. 3.75 respectively.
1.2.4 Transactions with key management personnel
Our policy in determining our executive officers for reporting purposes has
traditionally been to include all statutory officers and all members of our
Management Council. As of April, 2002 in line with our growth and strategic
objectives, we divided our Management Council into two levels comprising of
senior executives and all other members. In accordance with this policy, our
directors and executive officers, which include only senior members of our
Management Council, who we believe are our key management personnel.
Particulars of remuneration and other benefits provided to key management
personnel during the quarters ended September 30, 2002, 2001, half-year
ended September 30, 2002, 2001 and the year ended March 31, 2002, are set
out below.
<TABLE>
<CAPTION>
Contributions
to provident Perquisites Sitting Reimbursement Total
Salary and other funds and incentives Commission(*) fees of expenses remuneration
------ --------------- -------------- ------------- ------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Executive Directors
Quarter ended September 30, 2002 1.12 0.06 0.54 -- -- -- 1.72
Quarter ended September 30, 2001 0.43 0.07 0.16 -- -- -- 0.66
Half year ended September 30, 2002 1.77 0.11 1.34 -- -- -- 3.22
Half year ended September 30, 2001 0.88 0.12 0.83 -- -- -- 1.83
Year ended March 31, 2002 2.02 0.21 1.07 -- -- -- 3.30
==== ==== ==== ==== ==== ==== ====
Independent Directors
Quarter ended September 30, 2002 -- -- -- -- -- -- 0.10
Quarter ended September 30, 2001 -- -- -- -- -- -- 0.09
Half year ended September 30, 2002 -- -- -- -- -- -- 0.31
Half year ended September 30, 2001 -- -- -- -- -- -- 0.18
Year ended March 31, 2002 -- -- -- 0.96 0.06 0.27 1.29
---- ---- ---- ---- ---- ---- ----
</TABLE>
(*) An amount of Rs. 0.24 and Rs. 0.48 provided during the quarter and
half-year ended September 30, 2002, such provision for the quarter and
half-year ended September 30, 2001 were Rs. 0.24 and Rs. 0.48 and for the
year ended March 31, 2002, Rs. 0.96.
<TABLE>
<CAPTION>
Contributions Outstanding
to provident Perquisites Total Total loans and
Salary and other funds and incentives remuneration loans granted advances
------ --------------- -------------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Other Senior Management Personnel
Quarter ended September 30, 2002 0.30 0.05 0.11 0.46 -- 0.07
Quarter ended September 30, 2001 0.26 0.05 0.11 0.42 -- 0.09
Half year ended September 30, 2002 0.60 0.05 0.32 0.97 -- 0.07
Half year ended September 30, 2001 0.55 0.05 0.38 0.98 -- 0.09
Year ended March 31, 2002 1.10 0.11 0.79 2.00 -- 0.08
==== ==== ==== ==== ==== ====
</TABLE>
In addition, the details of the only options granted to non-wholetime
directors and other senior officers during the quarters ended September 30,
2002, 2001, half-year ended September 30, 2002, 2001 and the year ended
March 31, 2002 are as follows:
<TABLE>
<CAPTION>
Number of Exercise price Expiration of
Date of Grant Option plan options granted (in Rs.) options
-------------- ----------- --------------- ------------- ----------------
<S> <C> <C> <C> <C> <C>
Non-Wholetime Directors
Deepak M Satwalekar April 11, 2001 1999 7,000 3,215.60 April 11, 2011
Marti G Subrahmanyam April 11, 2001 1999 6,000 3,215.60 April 11, 2011
Philip Yeo April 11, 2001 1999 3,000 3,215.60 April 11, 2011
Jitendra Vir Singh April 11, 2001 1999 2,000 3,215.60 April 11, 2011
Omkar Goswami April 11, 2001 1999 2,000 3,215.60 April 11, 2011
Larry Pressler April 11, 2001 1999 2,000 3,215.60 April 11, 2011
Rama Bijapurkar April 11, 2001 1999 2,000 3,215.60 April 11, 2011
Claude Smadja July 10, 2002 1999 2,000 3,333.65 October 24, 2011
Other Senior Management Personnel
Girish G Vaidya October 29, 2001 1999 3,000 3,106.75 October 29, 2011
Basab Pradhan October 27, 2001 1998 4,000 2,366.85 October 27, 2011
Company Secretary
V Balakrishnan October 29, 2001 1999 2,000 3,106.75 October 29, 2011
---------------- ---- ----- -------- ----------------
</TABLE>
1.2.5 Pro-forma disclosures relating to the Employee Stock Option Plans
("ESOPs")
The company's 1994 stock option plan was established prior to the SEBI
guidelines on stock options. Had the stock compensation costs for this stock
option plan been determined as per the guidelines issued by SEBI, the
company's reported net profit would have been reduced to the pro forma
amounts indicated below.
<TABLE>
<CAPTION>
Quarter ended Half year ended
September 30, September 30, Year ended
------------------ ------------------ March 31,
2002 2001 2002 2001 2002
------ ------ ------ ------ ----------
<S> <C> <C> <C> <C> <C>
Net profit:
- As reported 225.77 201.56 442.62 391.59 807.96
- Adjusted pro forma 219.73 195.64 430.50 379.76 784.18
------ ------ ------ ------ ------
</TABLE>
11
<PAGE>
1.2.6 Intangible assets
During the first quarter, the company acquired the intellectual property
rights of Trade IQ product from IQ Financial Systems Inc., USA for its
banking group. The consideration paid amounts to Rs. 14.12 (US$ 2.88
million). An additional US$ 1 million (Rs. 4.88 as at September 30, 2002)
has been retained in escrow for payment to the seller based on the
successful renewal of certain customer contracts in favor of the company.
The consideration has been recorded as an intangible asset, which is being
amortized over two years representing management's estimate of the useful
life of the intellectual property.
The company also entered into an agreement in the first quarter, with the
Aeronautical Development Agency, India ("ADA") for transferring the
intellectual property rights in AUTOLAY, a commercial software application
product used in the design of high performance structural systems. The
company will pay the consideration in the form of a revenue share with a
firm commitment of US$ 5 million (Rs. 24.50) payable by 10 years of the
contract date. The ownership of intellectual property in AUTOLAY transfers
to the company on remittance of the consideration to ADA. The committed
consideration of Rs. 24.50 has been recorded as an intangible asset and is
being amortized over five years, which is management's estimate of the
useful life.
1.2.7 Investment activity
Progeon was incorporated on April 3, 2002, and is a majority owned and
controlled subsidiary, established to provide business process management
and transitioning services. As at the balance sheet date, the company has
invested Rs. 12.25 in 1,22,49,993 fully paid equity shares in Progeon of
face value Rs. 10/- each, at par. Progeon seeks to leverage the benefits of
service delivery globalization, process redesign and technology to drive
efficiency and cost effectiveness in customer business processes. Progeon
obtained its financial closure by securing funding of Rs. 49.00 from
Citicorp International Finance Corporation, USA ("CIFC") in exchange for
43,75,000 cumulative, convertible, redeemable preferred shares of face value
Rs. 100/- at a premium of Rs. 12/ - per share. The preference shares are
convertible to an equal number of equity shares based on certain events as
agreed between the company and CIFC.
During the half-year ended September 30, 2002 the company invested Rs. 0.27
in M-Commerce Ventures Pte Limited, Singapore ("M-Commerce") for 10 ordinary
shares of face value Singapore $ ("S$") 1/- each fully paid at par and 90
redeemable preference shares of face value S$ 1/- each fully paid for a
premium of S$ 1,110. Accordingly, the aggregate investment in M-Commerce as
at September 30, 2002 amounts to Rs. 2.11 (Rs. 1.84 as at September 30, 2001
and March 31, 2002).
1.2.8 Segment reporting
The company's operations predominantly relate to providing IT services,
delivered to customers globally operating in various industry segments.
Accordingly, IT service revenues represented along industry classes comprise
the primary basis of segmental information set out in these financial
statements. Secondary segmental reporting is performed on the basis of the
geographical location of customers.
The accounting principles consistently used in the preparation of the
financial statements are also consistently applied to record income and
expenditure in individual segments. These are as set out in the note on
significant accounting policies.
Industry segments at the company are primarily financial services comprising
customers providing banking, finance and insurance services; manufacturing
companies; companies in the telecommunications and the retail industries;
and others such as utilities, transportation and logistics companies.
Income and direct expenses in relation to segments is categorized based on
items that are individually identifiable to that segment, while the
remainder of the costs are categorized in relation to the associated
turnover of the segment. Certain expenses such as depreciation, which form a
significant component of total expenses, are not specifically allocable to
specific segments as the underlying services are used interchangeably. The
company believes that it is not practical to provide segment disclosures
relating to those costs and expenses, and accordingly these expenses are
separately disclosed as "unallocated" and directly charged against total
income.
Fixed assets used in the company's business or liabilities contracted have
not been identified to any of the reportable segments, as the fixed assets
and services are used interchangeably between segments. Accordingly, no
disclosure relating to total segment assets and liabilities are made.
Customer relationships are driven based on the location of the respective
client. North America comprises the United States of America, Canada and
Mexico; Europe includes continental Europe (both the east and the west),
Ireland and the United Kingdom; and the Rest of the World comprising all
other places except those mentioned above and India.
Geographical revenues are segregated based on the location of the customer
who is invoiced or in relation to which the revenue is otherwise recognized.
Industry segments
Quarter ended September 30, 2002, September 30, 2001, Half year ended
September 30, 2002, September 30, 2001 and year ended March 31, 2002
<TABLE>
<CAPTION>
Financial services Manufacturing Telecom Retail Others Total
------------------ ------------- -------- ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Revenues 339.61 150.46 128.45 99.21 161.84 879.57
248.44 111.84 99.39 74.75 115.71 650.13
621.46 276.13 244.59 187.77 314.24 1,644.19
474.02 224.24 201.67 142.79 219.93 1,262.65
953.98 445.94 406.79 320.40 476.48 2,603.59
Identifiable operating expenses 139.84 61.38 44.87 30.74 62.17 339.00
89.88 47.01 27.00 20.63 43.90 228.42
256.91 115.45 83.50 59.97 116.27 632.10
168.04 91.62 52.93 38.78 80.45 431.82
355.38 181.92 114.13 89.43 166.37 907.23
Allocated expenses 84.92 36.90 31.50 24.33 39.68 217.33
63.47 27.66 24.58 18.48 28.61 162.80
162.30 67.93 60.18 46.20 77.31 413.92
128.09 57.86 52.06 36.77 56.62 331.40
247.73 111.26 101.50 79.61 118.63 658.73
Segmental operating income 114.85 52.18 52.08 44.14 59.99 323.24
95.09 37.17 47.81 35.64 43.20 258.91
202.25 92.75 100.91 81.60 120.66 598.17
177.89 74.76 96.68 67.24 82.86 499.43
350.87 152.76 191.16 151.36 191.48 1,037.63
------ ------ ------ ------ ------ --------
</TABLE>
12
<PAGE>
Industry segments (continued)
<TABLE>
<CAPTION>
Quarter ended Half year ended
September 30, September 30, Year ended
------------------- ------------------- March 31,
2002 2001 2002 2001 2002
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Unallocable expenses 46.24 39.01 86.71 74.49 160.65
Operating income 277.00 219.90 511.46 424.94 876.98
Other income (expense), net (6.23) 14.66 18.66 28.15 66.41
Net profit before taxes 270.77 234.56 530.12 453.09 943.39
Income taxes 45.00 33.00 87.50 61.50 135.43
------ ------ ------ ------ ------
Net profit after taxes 225.77 201.56 442.62 391.59 807.96
====== ====== ====== ====== ======
</TABLE>
Geographic segments
Quarter ended September 30, 2002, September 30, 2001, Half year ended September
30, 2002, September 30, 2001 and year ended March 31, 2002
<TABLE>
<CAPTION>
North America Europe India Rest of the World Total
------------- ------- ------- ----------------- ---------
<S> <C> <C> <C> <C> <C>
Revenues 648.01 144.94 22.35 64.27 879.57
462.51 122.87 11.86 52.89 650.13
1,200.57 292.44 36.45 114.73 1,644.19
904.60 244.28 28.08 85.69 1,262.65
1,854.10 506.84 51.12 191.53 2,603.59
Identifiable operating expenses 260.29 48.76 6.72 23.23 339.00
160.95 46.10 4.93 16.44 228.42
476.70 103.17 12.60 39.63 632.10
303.13 89.14 9.77 29.78 431.82
646.90 181.55 19.98 58.80 907.23
Allocated expenses 161.04 36.02 5.00 15.27 217.33
115.78 30.76 3.38 12.88 162.80
298.84 72.80 11.04 31.24 413.92
235.90 63.75 9.53 22.22 331.40
468.20 127.97 14.82 47.74 658.73
Segmental operating income 226.68 60.16 10.63 25.77 323.24
185.78 46.01 3.55 23.56 258.91
425.03 116.47 12.81 43.86 598.17
365.57 91.39 8.78 33.69 499.43
739.00 197.32 16.32 84.99 1,037.63
-------- ------ ----- ------ --------
</TABLE>
<TABLE>
<CAPTION>
Quarter ended Half year ended
September 30, September 30, Year ended
------------------- ------------------ March 31,
2002 2001 2002 2001 2002
------ ------ ------ ------ ----------
<S> <C> <C> <C> <C> <C>
Unallocable expenses 46.24 39.01 86.71 74.49 160.65
Operating income 277.00 219.90 511.46 424.94 876.98
Other income (expense), net (6.23) 14.66 18.66 28.15 66.41
Net profit before taxes 270.77 234.56 530.12 453.09 943.39
Income taxes 45.00 33.00 87.50 61.50 135.43
------ ------ ------ ------ ------
Net profit after taxes 225.77 201.56 442.62 391.59 807.96
====== ====== ====== ====== ======
</TABLE>
1.2.9 Provisions for investments
The Company evaluates all investments for any diminution in their carrying
values that is other than temporary. Accordingly, the company provided for
an aggregate amount of Rs. 23.76, which consists of Rs.0.75 to JASDIC Park
Company, Japan; Rs. 6.85 to Asia Net Media (BVI) Ltd, the British Virgin
Islands; Rs. 8.95 to OnMobile Systems Inc (formerly OnScan Inc), USA;
Rs.7.21 to Workadia Inc., U.S.A.; Rs.10,350/- to The Saraswat Co-operative
Bank Limited and Rs.10/- to Software Services Support Education Center
Limited, during the quarter ended September 30, 2002.
1.2.10 Reconciliation of basic and diluted shares used in computing earnings
per share
<TABLE>
<CAPTION>
Quarter ended Half year ended
September 30, September 30, Year ended
-------------------------- --------------------------- March 31,
2002 2001 2002 2001 2002
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Number of shares considered as basic
weighted average shares outstanding 6,61,98,735 6,61,60,717 6,61,93,632 6,61,59,892 6,61,62,274
Add: Effect of dilutive issues of shares/stock
options 3,97,734 1,73,889 4,58,300 1,52,840 4,05,301
----------- ----------- ----------- ----------- -----------
Number of shares considered as
weighted average shares and potential shares
outstanding 6,65,96,469 6,63,34,606 6,66,51,932 6,63,12,732 6,65,67,575
----------- ----------- ----------- ----------- -----------
</TABLE>
A complete set of the audited financial statements is available at
www.infosys.com
13
<PAGE>
Cash flow statement for the
<TABLE>
<CAPTION>
in Rs. crore
-------------------------------------------------------------------
Quarter ended Half year ended
September 30, September 30, Year ended
--------------------- --------------------- March 31,
2002 2001 2002 2001 2002
-------- ------ -------- ------ ----------
<S> <C> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax 270.77 234.56 530.12 453.09 943.39
Adjustments to reconcile profit before tax to cash
provided by operating activities
(Profit)/Loss on sale of fixed assets 0.14 0.01 0.13 (0.02) (0.09)
Depreciation and amortization 46.24 39.01 86.72 74.49 160.65
Interest income (18.69) (11.79) (36.37) (23.60) (51.23)
Effect of deferred taxes (8.74) (2.05) (9.36) (3.11) (8.69)
Provision on long term investments 23.76 -- 23.76 -- --
Income taxes paid during the period/year 1 (70.20) (40.94) (95.54) (78.84) (131.27)
Exchange differences on translation of
foreign currency deposits 1.06 (2.56) 0.97 (3.82) (13.26)
Changes in current assets and liabilities
Sundry debtors (44.96) (34.48) (121.52) (41.23) (34.36)
Loans and advances 2 (22.05) (9.15) (73.64) (18.10) (39.02)
Current liabilities and provisions 3 46.38 26.18 111.45 45.88 (5.16)
-------- ------- -------- ------- --------
NET CASH GENERATED BY OPERATING ACTIVITIES 223.71 198.79 416.72 404.74 820.96
-------- ------- -------- ------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds on exercise of stock options 2.75 -- 3.15 0.41 4.60
Dividends paid during the period/year, including
Dividend Tax -- -- (82.73) (54.68) (109.37)
-------- ------- -------- ------- --------
NET CASH GENERATED / (USED) BY FINANCING ACTIVITIES 2.75 -- (79.58) (54.27) (104.77)
-------- ------- -------- ------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of fixed assets and change in capital
work-in-progress 4 (44.02) (129.75) (97.80) (231.49) (322.74)
Proceeds on disposal of fixed assets 0.04 0.95 0.16 1.03 1.60
Long-term investments in securities 5 -- -- (12.52) (10.32) (10.32)
Interest income 18.69 11.79 36.37 23.60 51.23
-------- ------- -------- ------- --------
NET CASH USED IN INVESTING ACTIVITIES (25.29) (117.01) (73.79) (217.18) (280.23)
-------- ------- -------- ------- --------
Effect of exchange differences on translation of
foreign currency deposits (1.06) 2.56 (0.97) 3.82 13.26
-------- ------- -------- ------- --------
Net (decrease)/increase in cash and cash
equivalents during the period/year 200.11 84.34 262.38 137.11 449.22
CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE PERIOD/YEAR 1,089.23 630.51 1,026.96 577.74 577.74
-------- ------- -------- ------- --------
CASH AND CASH EQUIVALENTS AT THE
END OF THE PERIOD/YEAR 6 1,289.34 714.85 1,289.34 714.85 1,026.96
= ======== ======= ======== ======= ========
NOTES ON THE STATEMENT OF CASH FLOWS 7
</TABLE>
This is the Cash Flow Statement referred to in our report of even date.
For Bharat S Raut & Co.
Chartered Accountants
<TABLE>
<S> <C> <C> <C> <C>
S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar
Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director
President and Managing Deputy Managing Director
Director
Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler
Director Director Director Director
Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal
Director Director Director Director
T. V. Mohandas Pai Srinath Batni V. Balakrishnan
Bangalore Director and Chief Director Company Secretary and
October 10, 2002 Financial Officer Vice President - Finance
</TABLE>
14
<PAGE>
Schedules to the statement of cash flows
<TABLE>
<CAPTION>
in Rs. crore
--------------------------------------------------------
Quarter ended Half year ended
September 30, September 30, Year ended
------------------- ------------------- March 31,
2002 2001 2002 2001 2002
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
1 Income taxes paid during the period/year
Charge as per the Profit and Loss Account 45.00 33.00 87.50 61.50 135.43
Add: Increase in advance income taxes 78.94 42.99 104.90 80.40 112.51
Less: Increase/(Decrease) in income tax provision (53.74) (35.05) (96.86) (63.06) (116.67)
-------- ------- -------- ------- --------
70.20 40.94 95.54 78.84 131.27
======== ======= ======== ======= ========
2 Change in loans and advances during the period/year
As per the Balance Sheet 870.16 623.26 870.16 623.26 643.87
Less: Deposits with financial institutions and body corporate,
included in cash and cash equivalents (302.49) (287.16) (302.49) (287.16) (254.74)
Advance income taxes separately considered (341.15) (204.14) (341.15) (204.14) (236.25)
-------- ------- -------- ------- --------
226.52 131.96 226.52 131.96 152.88
Less: Opening balance considered (204.47) (122.81) (152.88) (113.86) (113.86)
-------- ------- -------- ------- --------
22.05 9.15 73.64 18.10 39.02
======== ======= ======== ======= ========
3 Change in current liabilities and provisions during the period/year
As per the Balance Sheet 692.25 428.80 692.25 428.80 459.41
Add/(Less):Provisions separately considered in the cash
flow statement
Income taxes (336.43) (185.97) (336.43) (185.97) (239.57)
Dividends (82.76) (49.62) (82.76) (49.62) (82.73)
Dividend tax -- (5.06) -- (5.06) --
-------- ------- -------- ------- --------
273.06 188.15 273.06 188.15 137.11
Less: Non-cash transactions -- -- (24.50) -- --
Less: Opening balance considered (226.68) (161.97) (137.11) (142.27) (142.27)
-------- ------- -------- ------- --------
46.38 26.18 111.45 45.88 (5.16)
======== ======= ======== ======= ========
4 Purchases of fixed assets and change in capital work-in-progress
As per the Balance Sheet 40.64 57.57 180.62 165.95 342.72
Less: Opening capital work-in-progress (88.97) (164.01) (150.67) (170.65) (170.65)
Less: Non-cash transactions -- -- (24.50) -- --
Add: Closing capital work-in-progress 92.35 236.19 92.35 236.19 150.67
-------- ------- -------- ------- --------
44.02 129.75 97.80 231.49 322.74
======== ======= ======== ======= ========
5 Long-term investments in securities during the period/year
As per the Balance Sheet 33.20 44.44 33.20 44.44 44.44
Add: Provisions on investments 23.76 -- 23.76 -- --
-------- ------- -------- ------- --------
56.96 44.44 56.96 44.44 44.44
Less: Opening balance considered (56.96) (44.44) (44.44) (34.12) (34.12)
-------- ------- -------- ------- --------
-- -- 12.52 10.32 10.32
======== ======= ======== ======= ========
6 Cash and cash equivalents at the end of the period/year
As per the Balance Sheet 986.85 427.69 986.85 427.69 772.22
Add: Deposits with financial institutions and body corporate,
included herein 302.49 287.16 302.49 287.16 254.74
-------- ------- -------- ------- --------
1,289.34 714.85 1,289.34 714.85 1,026.96
======== ======= ======== ======= ========
</TABLE>
7. Notes on the statement of cash flows
7.1 Cash flows are reported using the indirect method, whereby profit before
tax is adjusted for the effects of transactions of a non-cash nature and
any deferrals or accruals of past or future cash receipts or payments.
The cash flows from regular revenue generating, financing, and investing
activities of the company are segregated. Cash flows in foreign
currencies are accounted at average monthly exchange rates that
approximate the actual rates of exchange prevailing at the dates of the
transactions.
7.2 The balance of cash and cash equivalents includes Rs. 1.53 as at
September 30, 2002 (as at September 30, 2001, Rs. 0.76 and March 31,
2002, Rs. 0.48) set aside for payment of dividends, also an amount of Rs.
4.88 (nil as at September 30, 2001 and March 31, 2002) has been retained
in escrow for payment to IQ Financial Systems, USA towards purchase of
IPR and the same is payable on the successful renewal of certain customer
contracts in favor of the company. Accordingly, such cash is not
available to the company.
7.3 During the quarter, the company entered into an agreement with the
Aeronautical Development Agency, India for acquiring the intellectual
property rights in AUTOLAY, a commercial software application product
used in the design of high performance structural systems. The agreement
requires the company to pay a consideration of $5 million (approximately
Rs. 24.50) by 10 years of the contract date. The intellectual property
has been recorded in the books of account along with the corresponding
liability, which in substance is a non-cash transaction and hence has
been excluded in the statement of cash flows.
7.4 Long-term investments in securities includes Rs. 12.25 invested in
Progeon Ltd., a subsidiary, in the quarter ended September 30, 2002.
7.5 The previous year's/period's figures have been recast/restated, wherever
necessary, to conform to the current period's presentation.
15
<PAGE>
Consolidated financial statements of Infosys Technologies Limited and its
subsidiary
Principles of consolidation
The financial statements are prepared in accordance with the principles and
procedures for the preparation and presentation of consolidated financial
statements as laid down under the accounting standard on Consolidated Financial
Statements issued by the ICAI. This being the first year of presentation of
consolidated financial statements in line with the accounting standards, prior
period figures have not been provided as they are unconsolidated and therefore
do not permit meaningful comparison. The financial statements of the parent
company, Infosys and Progeon have been combined on a line-by-line basis by
adding together the book values of like items of assets, liabilities, income and
expenses after eliminating intra-group balances and transactions and resulting
unrealized gains/losses. The consolidated financial statements are prepared
applying uniform accounting polices in use at Infosys and Progeon.
Management's Statement on significant accounting policies contained in the
audited financial statements
There are no changes in the accounting policies during the quarter
ended September 30, 2002. The significant accounting policies of the company
relate to revenue recognition, expenditure, fixed assets and capital work-in
-progress, depreciation, retirement benefits to employees - principally
gratuity, superannuation and provident fund benefits, research and development,
income tax, earning per share, foreign currency transactions and investments.
A complete set of the audited consolidated financial statements is available at
www.infosys.com
Auditor's report
We have examined the attached Consolidated Balance Sheet of Infosys Technologies
Limited (the Company) and its subsidiary Progeon Limited (subsidiary) as at
September 30, 2002, the Consolidated Profit and Loss Accounts and the
Consolidated Cash Flow Statements for the quarter and half-year ended on that
date, annexed thereto.
These financial statements are the responsibility of the Infosys Technologies
Limited's management. Our responsibility is to express an opinion on these
financial statements based on our audit. We conducted our audit in accordance
with generally accepted auditing standards in India. Those Standards require
that we plan and perform the audit to obtain reasonable assurance whether the
financial statements are prepared, in all material respects, in accordance with
the financial reporting framework generally accepted in India and are free of
material misstatements. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statements. We
believe that our audit provides a reasonable basis for our opinion.
We report that the consolidated financial statements have been prepared by the
Company in accordance with the requirements of Accounting Standard (AS) 21,
Consolidated Financial Statements, issued by the Institute of Chartered
Accountants of India and on the basis of separate audited financial statements
of Infosys Technologies Limited and its subsidiary included in the consolidated
financial statements.
On the basis of the information and explanation given to us, and on
consideration of separate audit reports on individual audited financial
statements of Infosys Technologies Limited and its subsidiary, we are of the
opinion that:
(i) the Consolidated Balance Sheet gives a true and fair view of the
consolidated state of affairs of the Infosys Technologies Limited and
its subsidiary as at September 30, 2002;
(ii) the Consolidated Profit and Loss Accounts gives a true and fair view
of the consolidated results of operations of Infosys Technologies
Limited and its subsidiary for the quarter and half year ended on that
date; and
(iii) the Consolidated Cash Flow Statements gives a true and fair view of
the consolidated cash flows of Infosys Technologies Limited and its
subsidiary for the quarter and half year ended on that date.
for Bharat S Raut & Co.
Chartered Accountants
Bangalore S Balasubrahmanyam
October 10, 2002 Partner
16
<PAGE>
Consolidated balance sheet as at
<TABLE>
<CAPTION>
in Rs. crore
------------------
September 30, 2002
------------------
<S> <C>
SOURCES OF FUNDS
SHAREHOLDERS' FUNDS
Share capital 33.10
Reserves and surplus 2,407.73
Preference shares issued by subsidiary 49.00
--------
2,489.83
========
APPLICATION OF FUNDS
FIXED ASSETS
Original cost 1,140.87
Less: Depreciation and amortization 476.70
--------
Net book value 664.17
Add: Capital work-in-progress 92.59
--------
756.76
INVESTMENTS 20.95
DEFERRED TAX ASSETS 33.58
CURRENT ASSETS, LOANS AND ADVANCES
Sundry debtors 459.73
Cash and bank balances 1,004.11
Loans and advances 912.20
--------
2,376.04
Less: Current liabilities 267.61
Provisions 429.89
--------
NET CURRENT ASSETS 1,678.54
--------
2,489.83
========
</TABLE>
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
The schedules referred to above and the notes thereon form an integral part of
the consolidated balance sheet.
This is the consolidated balance sheet referred to in our report of even date.
for Bharat S Raut & Co.
Chartered Accountants
<TABLE>
<S> <C> <C> <C> <C>
S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar
Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director
President and Managing Deputy Managing Director
Director
Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler
Director Director Director Director
Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal
Director Director Director Director
T. V. Mohandas Pai Srinath Batni V. Balakrishnan
Bangalore Director and Chief Director Company Secretary and
October 10, 2002 Financial Officer Vice President - Finance
</TABLE>
17
<PAGE>
Consolidated profit and loss account for the
<TABLE>
<CAPTION>
in Rs. crore, except per share data
-----------------------------------
Quarter ended Half year ended
------------- ---------------
September 30, 2002
-------------------------------
<S> <C> <C>
INCOME - Software services, products and business process management
Overseas 858.24 1,608.86
Domestic 22.34 36.44
----------- -----------
880.58 1,645.30
Software development and business process management expenses 425.50 803.24
----------- -----------
GROSS PROFIT 455.08 842.06
SELLING AND MARKETING EXPENSES 70.26 125.53
GENERAL AND ADMINISTRATION EXPENSES 63.38 121.27
----------- -----------
133.64 246.80
OPERATING PROFIT (PBIDTA) 321.44 595.26
Interest -- --
Depreciation and amortization 46.39 86.88
----------- -----------
OPERATING PROFIT AFTER INTEREST, DEPRECIATION AND AMORTIZATION 275.05 508.38
Other income 18.21 43.01
Provision for investments 23.76 23.76
----------- -----------
NET PROFIT BEFORE TAX 269.50 527.63
Provision for taxation 45.00 87.50
----------- -----------
NET PROFIT AFTER TAX 224.50 440.13
----------- -----------
AMOUNT AVAILABLE FOR APPROPRIATION 224.50 440.13
----------- -----------
DIVIDEND
Interim 82.76 82.76
----------- -----------
Balance in Profit and Loss Account 141.74 357.37
=========== ===========
EARNINGS PER SHARE (Equity shares, par value Rs. 5/- each)
Basic 33.91 66.49
Diluted 33.71 66.03
Number of shares used in computing earnings per share
Basic 6,61,98,735 6,61,93,632
Diluted 6,65,96,469 6,66,51,932
=========== ===========
</TABLE>
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
The schedules referred to above and the notes thereon form an integral part of
the consolidated profit and loss account.
This is the consolidated profit and loss account referred to in our report of
even date.
for Bharat S Raut & Co.
Chartered Accountants
<TABLE>
<S> <C> <C> <C> <C>
S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar
Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director
President and Managing Deputy Managing Director
Director
Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler
Director Director Director Director
Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal
Director Director Director Director
T. V. Mohandas Pai Srinath Batni V. Balakrishnan
Bangalore Director and Chief Director Company Secretary and
October 10, 2002 Financial Officer Vice President - Finance
</TABLE>
18
<PAGE>
Consolidated cash flow statement for the
<TABLE>
<CAPTION>
in Rs. crore
--------------------------------
Quarter ended Half year ended
------------- ---------------
September 30, 2002
--------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax 269.50 527.63
Adjustments to reconcile profit before tax to cash provided
by operating activities
(Profit)/Loss on sale of fixed assets (0.14) (0.13)
Depreciation and amortization 46.39 86.88
Interest income (19.79) (37.50)
Effect of deferred taxes (8.74) (9.36)
Provision for investments 23.76 23.76
Income taxes paid during the period (70.35) (95.69)
Exchange differences on translation of foreign currency deposits 1.06 0.97
Changes in current assets and liabilities
Sundry debtors (45.84) (123.01)
Loans and advances (23.96) (75.10)
Current liabilities and provisions 50.80 116.70
-------- --------
NET CASH GENERATED BY OPERATING ACTIVITIES 222.69 415.15
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issue of preference share capital -- 49.00
Proceeds on exercise of stock options 2.74 3.14
Dividends paid during the period/year, including dividend tax -- (82.73)
-------- --------
NET CASH GENERATED/(USED) BY FINANCING ACTIVITIES 2.74 (30.59)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of fixed assets and change in capital work-in-progress (46.99) (101.19)
Proceeds on disposal of fixed assets 0.32 0.44
Long-term investments in securities -- (0.27)
Interest income 19.79 37.50
-------- --------
NET CASH USED IN INVESTING ACTIVITIES (26.88) (63.52)
-------- --------
Effect of exchange differences on translation of foreign currency deposits (1.06) (0.97)
-------- --------
Net (decrease)/increase in cash and cash equivalents during the period 197.49 320.07
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 1,149.54 1,026.96
-------- --------
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 1,347.03 1,347.03
======== ========
NOTES ON THE STATEMENT OF CASH FLOWS
-------- --------
</TABLE>
This is the Cash Flow Statement referred to in our report of even date.
for Bharat S Raut & Co.
Chartered Accountants
<TABLE>
<S> <C> <C> <C> <C>
S. Balasubrahmanyam N. R. Narayana Murthy Nandan M. Nilekani S. Gopalakrishnan Deepak M. Satwalekar
Partner Chairman and Chief Mentor Chief Executive Officer, Chief Operating Officer and Director
President and Managing Deputy Managing Director
Director
Marti G. Subrahmanyam Jitendra Vir Singh Omkar Goswami Larry Pressler
Director Director Director Director
Claude Smadja Rama Bijapurkar K. Dinesh S. D. Shibulal
Director Director Director Director
T. V. Mohandas Pai Srinath Batni V. Balakrishnan
Bangalore Director and Chief Director Company Secretary and
October 10, 2002 Financial Officer Vice President - Finance
</TABLE>
19
<PAGE>
Ratio analysis as per Indian GAAP (Non-consolidated)
<TABLE>
<CAPTION>
Quarter ended Half Year ended
September 30, September 30, Year ended
------------------ ------------------ March 31,
2002 2001 2002 2001 2002
------ ------ ------ ------ ---------
<S> <C> <C> <C> <C> <C>
Financial performance
Export revenue/total revenue(%) 97.46 98.18 97.78 97.78 98.04
Domestic revenue/total revenue(%) 2.54 1.82 2.22 2.22 1.96
Software development expenses/total revenue(%) 48.26 47.21 48.77 46.93 47.04
Gross profit/total revenue(%) 51.74 52.79 51.23 53.07 52.96
Selling and marketing expenses/total revenue(%) 7.88 5.15 7.57 4.84 4.99
General and administration expenses/total revenue(%) 7.11 7.81 7.28 8.68 8.12
Selling, general and administration expenses/total revenue(%) 14.99 12.96 14.85 13.52 13.11
Employee costs/total revenue(%) 45.46 42.76 45.55 42.62 42.94
Operating profit/total revenue(%) 36.75 39.83 36.38 39.55 39.85
Depreciation and amortization/total revenue(%) 5.26 6.00 5.27 5.90 6.17
Operating profit after depreciation and interest/total revenue(%) 31.49 33.82 31.11 33.65 33.68
Other income/total revenue(%) 1.99 2.25 2.58 2.23 2.55
Provision for investments/total revenue(%) 2.70 -- 1.45 -- --
Profit before tax/total revenue(%) 30.78 36.08 32.24 35.88 36.23
Tax/total revenue(%) 5.12 5.08 5.32 4.87 5.20
Tax/PBT(%) 16.62 14.07 16.51 13.57 14.36
PAT from ordinary activities/total revenue(%) 25.67 31.00 26.92 31.01 31.03
PAT from ordinary activities/average net worth(%)(LTM) 41.04 52.15 41.04 52.15 46.57
ROCE (PBIT/Average capital employed)(%)(LTM) 48.76 59.39 48.76 59.39 54.37
Return on invested capital(%)(LTM) 75.04 89.64 75.04 89.64 83.10
Capital output ratio(LTM) 1.43 1.67 1.43 1.67 1.50
Invested capital output ratio(LTM) 2.74 2.98 2.74 2.98 2.79
Balance sheet
Debt-equity ratio -- -- -- -- --
Debtors turnover (Days)(LTM) 56 53 56 53 47
Current ratio 3.34 3.25 3.34 3.25 3.82
Cash and cash equivalents/total assets(%) 52.77 41.02 52.77 41.02 49.37
Cash and cash equivalents/total revenue(%)(LTM) 43.19 30.27 43.19 30.27 39.44
Capital expenditure/total revenue(%)(LTM) 6.33 20.96 6.33 20.96 12.40
Depreciation/average gross block(%)(LTM) 17.95 23.76 17.95 23.76 20.18
Technology investment/total revenue(%)(LTM) 3.14 6.51 3.14 6.51 3.93
Year on Year growth(%)(**)
Export revenue 34 45 30 56 36
Total revenue 35 46 30 58 37
Operating profit 25 47 20 59 36
Net profit 12 31 13 42 30
Basic EPS 12 31 13 42 30
Per - share data (period end)
Basic earnings per share from ordinary activities (Rs.) 34.10 30.47 66.87 59.19 122.12
Basic cash earnings per share from ordinary activities (Rs.) 41.09 36.36 79.96 70.45 146.40
Book value (Rs.) 369.05 263.37 369.05 263.37 314.31
Price/earning(LTM) 26.25 21.47 26.25 21.47 30.50
Price/cash earnings(LTM) 21.86 17.94 21.86 17.94 25.44
Price/book value 9.23 9.11 9.23 9.11 11.85
PE/EPS growth 2.20 0.70 2.03 0.51 1.03
Dividend per share (Rs.) NA NA 12.50 7.50 20.00
------ ------ ------ ------ ------
</TABLE>
(**) Denotes growth compared with figures of the corresponding period in the
previous year.
LTM: Last Twelve Months
20
<PAGE>
At a glance - US GAAP
<TABLE>
<CAPTION>
US $ millions, except as otherwise stated
----------------------------------------------------------------
Quarter ended Half year ended
September 30, September 30, Year ended
------------------ ---------------------- March 31,
2002 2001 2002 2001 2002
------ ------ -------- -------- --------
<S> <C> <C> <C> <C> <C>
For the period
Revenues 181.45 137.26 337.76 267.79 545.05
Operating income 55.44 45.16 101.87 87.60 178.55
Operating income/revenues(%) 30.55% 32.90% 30.16% 32.71% 32.76%
Net income 46.70 41.29 89.54 80.53 164.47
Net income/revenues(%) 25.74% 30.08% 26.51% 30.07% 30.17%
Basic earnings per equity share($) 0.71 0.63 1.36 1.23 2.51
Cash dividend per equity share($) NA NA 0.26 0.16 0.35
Capital expenditure 9.48 26.95 20.08 47.51 68.35
At the end of the period
Total assets 591.52 413.40 471.16
Property, plant and equipment-net 149.20 149.14 147.21
Cash and cash equivalents 278.31 149.39 210.49
Working capital 355.04 201.41 270.37
Total debt -- -- --
Stockholders' equity 524.02 374.07 442.38
Common stock 8.60 8.59 8.60
Market capitalization 4,659.60 3,288.47 5,053.15
------ ------ -------- -------- --------
</TABLE>
Note: Market capitalization is calculated by considering the Indian market price
for the shares outstanding at the period/year end.
Revenues
[PERFORMANCE GRAPH]
<TABLE>
<S> <C>
Year ended March 31, 2002 545.05
Quarter ended September 30, 2001 137.26
Quarter ended September 30, 2002 181.45
</TABLE>
Operating income
[PERFORMANCE GRAPH]
<TABLE>
<S> <C>
Year ended March 31, 2002 178.55
Quarter ended September 30, 2001 45.16
Quarter ended September 30, 2002 55.44
</TABLE>
Net income
[PERFORMANCE GRAPH]
<TABLE>
<S> <C>
Year ended March 31, 2002 164.47
Quarter ended September 30, 2001 41.29
Quarter ended September 30, 2002 46.70
</TABLE>
21
<PAGE>
Form 6-K
Page 22 - 46
<PAGE>
Shareholder information
<TABLE>
<S> <C>
1. Registered office Electronics City, Hosur Road, Bangalore - 561 229, India
Tel.: +91-80-852 0261, Fax: +91-80-852 0362
Homepage: www.infosys.com
2. Listing on stock exchanges In India: National Stock Exchange of India Ltd. (NSE)
The Stock Exchange, Mumbai (BSE)
Bangalore Stock Exchange Ltd. (BgSE)
Outside India: NASDAQ National Market in the United States
3. Par value of equity shares Rs. 5 each fully paid-up
4. Registrar and share transfer agents Karvy Consultants Limited,
Share transfers in physical form and other Registrars and Share Transfer Agents;
communication regarding share certificates, T.K.N. Complex, No. 51/2, Vanivilas Road;
dividends, change of address, etc. may be addressed to: Opposite National College, Basavanagudi;
Bangalore 560 004, India.
Tel.: +91-80-662-1184, Fax: +91-80-662-1169
E-mail: kannans@karvy.com
</TABLE>
5. Stock market data relating to shares listed in India
a. The company's market capitalization is included in the computation of
the BSE-30 Sensitive Index (Sensex), the BSE Dollex and S&P CNX NIFTY
Index.
b. Monthly high and low quotations as well as the volume of shares traded
at National, Mumbai and Bangalore Stock Exchanges for the quarter
ended September 30,2002 are:
<TABLE>
<CAPTION>
NSE BSE BgSE
-------------------------------- -------------------------------- -----------------------------
High Low Volume High Low Volume High Low Volume
Rs. Rs. Nos. Rs. Rs. Nos. Rs. Rs. Nos.
------ ----- ----------- ------ ------- ----------- ----- ---- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jul 2002 3,480 2,975 1,19,84,211 3,478 2,972 58,92,906 -- -- --
Aug 3,635 2,937 1,27,09,793 3,644 2,935 58,59,212 -- -- --
Sep 3,708 3,330 1,25,70,577 3,710 3,365 52,99,771 -- -- --
------ ----- ----------- ------ ------- ----------- ----- ---- ------
Total 3,72,64,581 1,70,51,889
----------- -----------
Volume traded/ shares outstanding (%)(*)
September 30, 2002 58.16 26.61 --
September 30, 2001 58.29 35.94 .001
----- ----- ----
</TABLE>
(*) The number of shares outstanding as of September 30,2002 is 6,40,70,030. The
equity shares underlying the American Depositary Shares (ADSs) have been
excluded for the purpose of this calculation.
6. Share transfer system
Shares sent for physical transfer are effected after giving a notice of 15
days to the seller for sale confirmation. The share transfer committee of
the company meets as often as required.
The total number of shares transferred in physical form during the
three-month period ended September 30,2002 was NIL (quarter ended September
30, 2001 - 9,000).
7. Investors' services - complaints received
<TABLE>
<CAPTION>
Quarter ended
-------------------------------------------------
September 30, 2002 September 30, 2001
----------------------- -----------------------
Nature of complaints Received Attended to Received Attended to
-------------------- --------- ----------- -------- -----------
<S> <C> <C> <C> <C>
Non-receipt of: dividend warrants 41 41 52 52
Dividend in ECS mode 34 34 -- --
Split shares/bonus shares 1 1 -- --
Share certificates -- -- 1 1
---- ---- ---- ----
Total 76 76 53 53
---- ---- ---- ----
</TABLE>
The company has attended to most of the investors' grievances/correspondence
within a period of 10 days from the date of receipt of the same, during the
quarter ended September 30, 2002 except in cases that are constrained by
disputes or legal impediments.
8. Legal proceedings
There are some pending cases relating to disputes over title to shares, in
which the company is made a party. However, these cases are not material in
nature.
9. Categories of shareholders as on September 30
<TABLE>
<CAPTION>
2002 2001
--------------------------------------------- ------------------------------------------
No. of Voting No. of No. of Voting No. of
Category shareholders strength(%) shares held shareholders strength(%) shares held
-------- ------------ ----------- ------------ ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Individuals 82,609 17.43 1,15,42,056 89,117 20.25 1,33,95,950
Companies 3,036 1.09 7,19,104 3,415 1.01 6,67,319
NRIs/OCBs 842 1.06 7,02,906 742 0.67 4,45,388
FIIs 308 37.67 2,49,42,998 361 34.61 2,28,97,389
Mutual Funds, Banks, FIs 196 9.68 64,10,994 187 10.10 66,85,980
Founders and their families 23 28.56 1,89,07,585 23 28.92 1,91,33,460
Trusts 8 1.28 8,44,387 19 1.28 8,44,514
Equity shares underlying
American Depositary Shares(*) 1 3.23 21,35,150 1 3.16 20,90,717
------ ------ ----------- ------ ------ -----------
Total 87,023 100.00 6,62,05,180 93,865 100.00 6,61,60,717
------ ------ ----------- ------ ------ -----------
</TABLE>
(*) Held by beneficial owners outside India
47
<PAGE>
10. Financial calendar (tentative and subject to change)
<TABLE>
<S> <C>
Interim dividend payment November 8, 2002
Financial reporting for the third quarter ending December 31, 2002 January 10, 2003
Financial results for the year ending March 31, 2003 April 10, 2003
Annual General Meeting for the year ending March 31, 2003 May / June 2003
</TABLE>
11. Investors' correspondence in India
<TABLE>
<S> <C>
For investor matters For queries relating to financial statements
V. Balakrishnan T. V. Mohandas Pai
Company Secretary & Vice President - Finance Director and Chief Financial Officer
Investors' Service Cell Infosys Technologies Ltd.,
Infosys Technologies Ltd., Electronics City
Electronics City Hosur Road, Bangalore 561 229, India
Hosur Road, Bangalore 561 229, India Tel.: +91-80-852-0396, Fax: +91-80-852-0754
Tel.: +91-80-852-0440, Fax: +91-80-852-0754 E-mail: mdpai@infosys.com
E-mail: balakv@infosys.com
</TABLE>
12. Stock Exchange Codes
<TABLE>
<CAPTION>
Reuters code Bridge code Bloomberg code
--------------- ---------------- --------------
<S> <C> <C>
INFY.BO (BSE) IN;INF (BSE) INFO IN (BSE)
INFY.NS (NSE) IN;INFN (NSE) NINFO IN (NSE)
INFY.O (NASDAQ) US;INFY (NASDAQ)
</TABLE>
13. Stock market data relating to American Depositary Shares (ADSs)
a. ADS(*) listed at NASDAQ National Market in the United
States
b. Ratio of ADS to equity shares 2 ADS for one equity share
c. ADS symbol INFY
d. The American Depositary Shares issued under the ADS program of the
company were listed on the NASDAQ National Market in the United States
on March 11, 1999. The monthly high and low quotations as well as the
volume of ADSs traded at the NASDAQ National Market for the quarter
ended September 30, 2002 are:
<TABLE>
<CAPTION>
High Low
--------------------- -------------------- Volume
$ Rs. $ Rs. Nos.
----- ----- ----- ----- ---------
<S> <C> <C> <C> <C> <C>
Jul 2002 57.00 2,775 48.00 2,337 16,86,500
Aug 57.75 2,802 49.50 2,402 17,03,000
Sep 60.68 2,937 53.05 2,568 14,87,300
---------
Total 48,76,800
---------
</TABLE>
(*) 2 ADS = 1 equity share. US $ has been converted into Indian rupees at the
monthly closing rates.
The number of ADSs outstanding as on September 30, 2002 was 42,70,300. The
percentage of volume traded to the total float was 114.20%.
<TABLE>
<S> <C>
e. Investor correspondence in P. R. Ganapathy
the US may be addressed to Investor Relations Officer
Infosys Technologies Limited
34760, Campus Drive,
Fremont CA 94555, USA.
Tel.: +1-510-742-3030, Mobile: +1-510-872-4412,
Fax: +1-510-742-2930, E-mail: guns@infosys.com
</TABLE>
14. ECS mandate
The company has received complaints regarding non-receipt of dividend
warrants. All shareholders are requested to update their bank account
details with their respective depositories urgently. This would enable the
company to service its investors better. A copy of the ECS mandate form is
provided elsewhere in the report. The ECS mandate form duly filled-up should
be sent to the depository participant with whom the shareholder maintains
his/her demat account.
15. Change of address
The company has received complaints regarding non-receipt of dividend
warrants and other corporate communications. All shareholders are requested
to update their current address with their respective depositories
immediately. This would enable the company to service its investors better.
48
<PAGE>
ELECTRONIC CLEARING SERVICE (CREDIT CLEARING)
MANDATE FORM
Shareholder's authorization to receive dividends through Electronic Credit
Clearing Mechanism
1. Name of the first/sole shareholder
2. Folio No.
3. Particulars of bank account of first/sole shareholder
a. Name of the Bank
b. Branch
Address of the branch
Telephone no. of the branch
c. 9-digit code number of the Bank and Branch
appearing on the MICR cheque issued by the bank
d. Account number
(as appearing on the cheque book/passbook)
e. Account type
(S.B. account/current account or cash credit)
with code 10/11/13
f. Ledger no. / Ledger folio no.
(if appearing on the cheque book/passbook)
(In lieu of the bank certificate to be obtained as under, please attach a blank
cancelled cheque, or photocopy of a cheque or the front page of the savings bank
passbook issued to you by your bank, for verification of the above particulars.)
I hereby declare that the particulars given above are correct and complete. If
the transaction is delayed or not effected at all for reasons of incomplete or
incorrect information, I will not hold Infosys Technologies Limited responsible.
I have read the option invitation letter and agree to discharge the
responsibility expected of me as a participant under the scheme.
Date :
Place :
Signature of the shareholder
--------------------------------------------------------------------------------
Certified that the particulars furnished above are correct as per our records.
Bank's Stamp
Signature of the Authorized Official
Date :
from the Bank
Note:
1. Please fill in the attached Mandate Form and send it to:
(i) the Depository Participant who is maintaining your demat account in case
your shares are dematerialized.
(ii) the address of our Registrars and Share Transfer Agents, M/s. Karvy
Consultants Limited, No. 51/2, T.K.N. Complex, Vanivilas Road, Opp.
National College, Basavanagudi, Bangalore - 560 004 in case you are holding
physical share certificates.
2. Kindly note that the information provided by you should be accurate and
complete in all respects and duly certified by your bank. In lieu of the
bank certificate, you may attach a blank cancelled cheque or photocopy of a
cheque or the front page of the Savings Bank passbook issued to you by your
bank, for verification of the above particulars.
3. In case of more than one folio please complete the details on separate
sheets.
4. The information provided by you will be treated confidential and would be
utilised only for the purpose of effecting the payments meant for you. You
also have the right to withdraw from this mode of payment by providing the
Company with an advance notice of 6 weeks.
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Infosys Technologies Limited
<TABLE>
<S> <C> <C> <C> <C>
United States UK Netherlands Chennai Mysore
Addison 11th Floor, Emerald House Newtonlaan 115, No. 138 No. 350
15305 Dallas Parkway 7/15 Lansdowne Road 3584 BH Utrecht Old Mahabalipuram Road Hebbal Electronics City
Suite 210 Croydon, CR0 2BX, Surrey The Netherlands Sholinganallur Hootagalli,
Addison, TX 75001 Tel: (44) 20 8774 3300 Tel: (31) 0 302106462 Chennai-600 119 Mysore-571 186
Tel: (972) 770 0450 Fax: (44) 20 8686 6631 Fax: (31) 0 302106860 Tel: (91) 44 4509530/40 Tel: (91) 821 404101
Fax: (972) 770 0490 Fax: (91) 44 4500390 Fax: (91) 821 404200
Castle House Scandinavia
Bellevue 37-45 Paul Street, Stureplan 4C, 4tr Hyderabad New Delhi
10900 NE 4th Street #2300 London 114 35, Stockholm, Sweden Survey No. 210 K30, Green Park Main
Bellevue, WA 98004 EC 2ALLS Tel: (46) 8 463 1112 Manikonda Village Behind Green Park Market
Tel: (425) 990 1028 Tel: 020 7549 6900 Fax: (46) 8 463 1114 Lingampally New Delhi-110 066
Fax: (425) 990 1029 Fax: 02072518320 Rangareddy (Dist) Tel: (91) 11 6514829-30
Singapore Hyderabad-500 019 Fax: (91) 11 6853366
Berkeley Heights Australia 30, Raffles Place Tel: (91) 40 3005222
Two Connell Drive Level 7, 505 St. Kilda Road #23-00 Caltex House Fax: (91) 40 3005223 Pune
Suite 4100 Melbourne, Victoria 3004 Singapore 048622 Plot No. 1;
Berkeley Heights Tel: (61) 3 9868 1607 Tel: (65) 6233 6820 Mangalore Pune Infotech Park
NJ 07922 Fax: (61) 3 9868 1652 Fax: (65) 6233 6905 Kuloor Ferry Road At Post Hinjawadi
Tel: (908) 286 3100 Kottara Taluka Mulshi
Fax: (908) 286 3125 Level 4, 90 Mount Street Switzerland Mangalore-575 006 Pune-411 027
North Sydney NSW 2060 Dreikonigstrasse 31A Tel: (91) 824 451485-88 Tel: (91) 20 2932800/01
Fremont Tel: (61) 2 9954 0036 8002 Zurich Fax: (91) 824 451504 Fax: (91) 20 2932832
34760 Campus Drive Fax: (61) 2 8904 1344 Tel: (41) 1 208 3905
Fremont, CA 94555 Fax: (41) 1 208 3500 Mohali (Chandigarh)
Tel: (510) 742 3000 Level 9, B 100, Industrial Area
Fax: (510) 742 3090 114, Albert Road United Arab Emirates Phase 8 Mohali
South Melbourne Y-45, P. O. Box 8230 (SAS Nagar)-160 059
Lake Forest Sharjah Airport Punjab
25341 Commercentre Drive Belgium International Free Tel: (91) 172 390510
Suite 150 Dreve Richelle 161 Zone (Saif Zone) Sharjah (91) 172 257191, 92
Lake Forest, CA 92630 Building N 1410 Waterloo Tel: (971) 6 5571 068 Fax: (91) 172 254193
Tel: (949) 455 9161 Brussels Fax: (971) 6 5571 056
Fax: (949) 609 0694 Tel: (322) 352 8718 Mumbai
Fax: (322) 352 8844 India 85-C Wing, 8th Floor
Lisle Bangalore Mittal Towers
2300 Cabot Drive Canada Electronics City Nariman Point
Ste 250, Lisle, IL 60532 5140 Yonge Street Hosur Road Mumbai-400 021
Tel: (630) 482 5000 Suite 1400 Bangalore-561 229 Tel: (91) 22 2882911/14
Fax: (630) 505 9144 Toronto, Ontario M2N 6L7 Tel: (91) 80 8520261 Fax: (91) 22 2846489
Tel: (416) 224 7400 Fax: (91) 80 8520362
Marietta Fax: (416) 224 7474
400 Galleria parkway, Reddy Building
Suite 1490, Atlanta France K-310, 1st Main
GA 30339 12 Avenue de l'Arche 5th Block, Koramangala
Tel: 770 980 7955 Faubourg de l'Arche Bangalore-560 095
Fax: 770 980 7956 92419 Courbevoie Cedex Tel: (91) 80 5532591/92
Paris Fax: (91) 80 5530391
Ohio Tel: (33)1 4691 8456
6543-6631, Fax: (33)1 4691 8800 Pavithra Complex
Commerce Parkway, #1, 27th Main, 2nd Cross
Dublin Ohio,43017 Germany 1st Stage, BTM Layout
Tel: (614) 792 9907 TOPAS 1 Bangalore-560 068
Fax: (614) 792 9929 Mergenthalerallee 77 Tel: (91) 80 6680182 - 85
65760 Eschborn/Frankfurt Fax: (91) 80 6680181
Phoenix Tel: (49) 6196 9694 0
10851 N Black Canyon Fax: (49) 6196 9694 200 Infosys Towers
Hwy No. 27, Bannerghatta Road
#830, Phoenix, AZ 85029 Hong Kong 3rd Phase, J.P. Nagar
Tel: (602) 944 4855 16F Cheung Kong Centre Bangalore-560 076
Fax: (602) 944 4879 2 Queen's Road Central Tel: (91) 80 6588668
Central, Hong Kong Fax: (91) 80 6588676
Quincy Tel: (852) 2297 2231
Two Adams Place, Fax: (852) 2297 0066 Bhubaneswar
Quincy MA 02169 Plot No. E/4, Info City
Tel: (781) 356 3100 Japan Bhubaneswar-751 024
Fax: (781) 356 3150 Kearny Place Akasaka, 2F Orissa, India
2-21-25, Akasaka Tel: (91) 674 320001-32
Troy Minato-Ku Fax: (91) 674 320100
100 Liberty Center Tokyo 107-0052
#200, West Big Beaver Tel: (81) 3 5545 3251
Troy MI 48084 Fax: (81) 3 5545 3252
Tel: (248) 524 0320
Fax: (248) 524 0321
</TABLE>
Bankers Visit Infosys at
ICICI Bank Ltd. www.infosys.com
Bank of America
Company Secretary Send e-mail to
V. Balakrishnan Infosys@infosys.com
Auditors Call us at
Bharat S Raut and Co. within the U.S.
Chartered Accountants 1-800-ITL INFO
Independent Auditors outside the U.S.
(US GAAP) 91-80-8520261
KPMG
(C)2002 Infosys Technologies Limited, Bangalore, India.
Infosys acknowledges the proprietary rights in the trademarks and
product names of other companies mentioned in this document.
</TEXT>
</DOCUMENT>