<DOCUMENT>
<TYPE>EX-19.1
<SEQUENCE>2
<FILENAME>f73842orex19-1.txt
<DESCRIPTION>EXHIBIT 19.1
<TEXT>
<PAGE> 1
EXHIBIT 19.1
INFOSYS TECHNOLOGIES LIMITED
Report for the first quarter ended June 30, 2001
[INFOSYS LOGO]
POWERED BY INTELLECT
DRIVEN BY VALUES
<PAGE> 2
At a glance - Indian GAAP
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------
Rs. in crores, except per share data
---------------------------------------------------------------------------------------------------------------
Quarter ended Year Ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
For the period
Total revenue 626.01 370.64 1,959.94
Export revenue 596.30 351.06 1,874.03
Operating Profit (PBIDT) 254.01 152.75 808.92
Profit after tax (PAT)
from ordinary activities 190.03 121.30 623.32
PBIDT as a percentage of total revenue 40.58% 41.21% 41.27%
PAT from ordinary activities as a percentage of total revenue 30.36% 32.73% 31.80%
Earnings per share from Ordinary activities*
Basic 28.72 18.34 94.23
Diluted 28.59 18.11 93.93
Dividend per share (Rs.) -- -- 10.00
Dividend amount -- -- 66.16
Capital investment 101.74 85.84 463.35
At the end of the period
Total assets 1,595.61 960.20 1,389.64
Fixed assets-net 623.89 275.43 557.66
Cash and cash equivalents 630.51 471.94 577.74
Working capital 910.69 648.60 797.86
Total debt -- -- --
Net worth 1,595.61 960.20 1,389.64
Equity 33.08 33.08 33.08
Market capitalization 23,900.56 54,974.43 26,926.35
--------- --------- ---------
</TABLE>
Note:
Market capitalization is calculated by considering the price at the National
Stock Exchange on the shares outstanding at the period end.
(*) EPS figures have been calculated for the period and have not been
annualized.
<TABLE>
<CAPTION>
YEAR ENDED QUARTER ENDED QUARTER ENDED
MARCH 31, 2001 JUNE 30, 2000 JUNE 30, 2001
-------------- ------------- -------------
<S> <C> <C> <C>
TOTAL REVENUE
(IN RS. CRORES) 1,959.94 370.64 626.01
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED QUARTER ENDED QUARTER ENDED
MARCH 31, 2001 JUNE 30, 2000 JUNE 30, 2001
-------------- ------------- -------------
<S> <C> <C> <C>
EXPORTS
(IN RS. CRORES) 1,874.03 351.06 596.30
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED QUARTER ENDED QUARTER ENDED
MARCH 31, 2001 JUNE 30, 2000 JUNE 30, 2001
-------------- ------------- -------------
<S> <C> <C> <C>
NET PROFIT FROM ORDINARY ACTIVITIES
(IN RS. CRORES) 623.32 121.30 190.03
</TABLE>
2
<PAGE> 3
Letter to the shareholders
--------------------------------------------------------------------------------
Dear shareholders,
We are pleased to report on a comfortable quarter. Under Indian GAAP, revenues
grew by 69% over Q1FY2001 while net profits from ordinary activities witnessed
an increase of 57%. Gross employee addition for the quarter stood at 315,
including 102 lateral entrants. Our relationships with Fortune 500 and other
established companies and our understanding of their decision cycles have
enabled us to grow in spite of a challenging environment. In line with our risk
management norms, start-up and venture-funded companies accounted for 5% of
total revenues for the quarter, down from 17% in Q1FY2001. Despite capital
expenditure of Rs. 101.74 crore, we have secured high free cash flows of Rs.
52.78 crore.
In light of the slowdown in the US economy, we have experienced pricing
pressures from both existing and new customers, especially in new, large-scale
offshore initiatives. However, we are encouraged by the intentions of most of
our clients to expand the scope of their relationship with us. For instance,
Toshiba Corporation has re-engaged Infosys to build the information
infrastructure for its global operations across various business lines. New York
Life International has entered into a worldwide expansion project with Infosys.
We have also launched an availability analysis and capacity-planning exercise
across multiple applications for Telstra in Australia.
Increasingly, companies are looking for higher returns on their IT investments
and are therefore gravitating towards offshoring their outsourcing activities.
Infosys' Global Delivery Model combines the benefits of offshore capabilities
with our proven ability to deliver high-quality, high-value solutions to
clients.
We added 26 new clients this quarter. Significant wins include APL, a provider
of worldwide container transportation and logistic services; Burlington Northern
and Santa Fe Railway Company, the second largest rail network in North America;
Pinnacle West Capital Corporation, a US-based company with consolidated revenues
of approximately $2 billion; Valeo, a global automotive equipment supplier;
Airbus, a leading aircraft manufacturer; BHF-Bank, a German bank; Statoil ASA, a
leading Scandinavian retailer of petrol and other oil products; and GreenPoint
Mortgage, a specialty finance lender.
Our results for the quarter exceed the estimates given at the end of the last
fiscal year. Nevertheless, since the external environment continues to be
challenging, we have not revised our annual revenue growth forecast of 30% for
fiscal 2002. Further, we anticipate total income for the quarter ending
September 30, 2001 to be in the range of Rs. 625 crore to Rs. 640 crore.
However, our plans for 1500-2000 gross employee additions in fiscal 2002 remain
unchanged.
During the quarter, we invested $2.2 million in Workadia, a provider of
comprehensive, customizable business intranets through browser-accessed hosted
portals, along with American Express, Tibco and WestBridge Capital Partners.
Workadia will also offer consulting services to help customers select and deploy
their intranet applications, content and services.
We intend to reformat our Indian GAAP income statement following the functional
classification methodology. We believe that this will enable a more meaningful
analysis and comparison of revenues, costs and margins as well as facilitate a
better understanding of our business by the financial community. The pro forma
profit and loss account prepared in accordance with the proposed format is
provided elsewhere in this report. Starting next quarter, we intend to report
our income statement in the revised format.
The jury for The Economic Times' Awards for Corporate Excellence 2000-01
recognized Infosys as the Corporate Citizen of the Year. The Credit Lyonnais
study on corporate governance practices in emerging markets has ranked Infosys
No. 2 in emerging markets and No. 1 in India. The company has been ranked No. 1
in a recent Dataquest survey of the top 20 Indian software companies. Infosys
was ranked as having the Best Investor Relations by an Emerging Markets Company
in the UK Awards given by IR Magazine.
As in the past, Infoscions participated in several conferences and published
research in emerging technology areas, thereby demonstrating the company's
commitment to technical thought leadership. On your behalf, we congratulate
these high achievers and also extend our appreciation to fellow Infoscions for
contributing to yet another successful quarter through their unstinting
commitment and hard work.
<TABLE>
<S> <C> <C>
/s/ NANDAN M. NILEKANI /s/ N. R. NARAYANA MURTHY
Bangalore Nandan M. Nilekani N. R. Narayana Murthy
July 10, 2001 Managing Director, President and Chairman and
Chief Operating Officer Chief Executive Officer
</TABLE>
3
<PAGE> 4
Auditors' report to the members of Infosys Technologies Limited
--------------------------------------------------------------------------------
We have audited the attached Balance Sheet of Infosys Technologies Limited (the
Company) as at June 30, 2001 and the Profit and Loss Account of the Company for
the quarter ended on that date, annexed thereto, and report that:
1 As required by the Manufacturing and Other Companies (Auditor's Report)
Order, 1988, issued by the Company Law Board in terms of Section 227(4A)
of the Companies Act, 1956, we enclose in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the said Order.
2 Further to our comments in the Annexure referred to in paragraph 1 above:
(a) we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of
our audit;
(b) in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
these books;
(c) the Balance Sheet and Profit and Loss Account dealt with by this
report are in agreement with the books of account;
(d) in our opinion, the Balance Sheet and Profit and Loss Account
dealt with by this report are prepared in compliance with the
accounting standards referred to in Section 211(3C) of the
Companies Act, 1956, to the extent applicable;
(e) in our opinion, and to the best of our information and according
to the explanations given to us, the said accounts give the
information required by the Companies Act, 1956, in the manner so
required and give a true and fair view:
(i) in the case of the Balance Sheet, of the state of affairs
of the Company as at June 30, 2001; and
(ii) in the case of the Profit and Loss Account, of the profit
for the quarter ended on that date.
for Bharat S Raut & Co.
Chartered Accountants
Bangalore Balaji Swaminathan
July 10, 2001 Partner
4
<PAGE> 5
Balance Sheet as at
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------
in Rs.
--------------------------------------------------------------------------------------------------------
June 30, 2001 June 30, 2000 March 31, 2001
-------------- ------------- --------------
<S> <C> <C> <C>
SOURCES OF FUNDS
SHAREHOLDERS' FUNDS
Share capital 33,08,05,085 33,07,58,335 33,07,92,085
Reserves and surplus 1562,52,96,675 927,12,34,168 1356,55,99,903
-------------- ------------- --------------
1595,61,01,760 960,19,92,503 1389,63,91,988
============== ============= ==============
APPLICATION OF FUNDS
FIXED ASSETS
Original cost 738,74,44,287 373,65,25,244 631,14,44,025
Less: Depreciation 278,86,97,454 151,26,93,565 244,13,15,982
-------------- ------------- --------------
Net book value 459,87,46,833 222,38,31,679 387,01,28,043
Add: Capital work-in-progress 164,01,15,365 53,04,58,784 170,65,04,250
-------------- ------------- --------------
623,88,62,198 275,42,90,463 557,66,32,293
INVESTMENTS 44,44,22,821 36,16,97,129 34,11,54,821
DEFERRED TAX ASSETS 16,59,00,000 -- --
CURRENT ASSETS, LOANS AND ADVANCES
Sundry debtors 309,12,07,202 228,39,91,832 302,37,02,417
Cash and bank balances 446,28,93,265 426,00,41,918 385,06,10,285
Loans and advances 468,17,78,978 196,24,84,174 430,27,93,623
-------------- ------------- --------------
1223,58,79,445 850,65,17,924 1117,71,06,325
Less: Current liabilities 154,53,25,723 116,79,86,403 134,91,81,176
Provisions 158,36,36,981 85,25,26,610 184,93,20,275
-------------- ------------- --------------
NET CURRENT ASSETS 910,69,16,741 648,60,04,911 797,86,04,874
-------------- ------------- --------------
1595,61,01,760 960,19,92,503 1389,63,91,988
============== ============= ==============
</TABLE>
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> <C>
Balaji Swaminathan N. R. Narayana Murthy Nandan M. Nilekani Deepak M. Satwalekar Marti G. Subrahmanyam Jitendra Vir Singh
Partner Chairman and Managing Director, Director Director Director
Chief Executive Officer President and
Chief Operating
Officer
Omkar Goswami Larry Pressler Rama Bijapurkar S. Gopalakrishnan K. Dinesh
Director Director Director Deputy Managing Director
Director
S. D. Shibulal T. V. Mohandas Pai Phaneesh Murthy Srinath Batni V. Balakrishnan
Director Director and Director Director Company Secretary and
Chief Financial Vice President -
Officer Finance
</TABLE>
Bangalore,
July 10, 2001
5
<PAGE> 6
Profit and Loss Account
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------
in Rs.
----------------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- ---------------
<S> <C> <C> <C>
INCOME
Software development services and products
Overseas 596,30,21,488 351,05,78,423 1874,02,66,421
Domestic 16,21,65,861 4,47,21,726 26,53,92,386
Other income 13,49,39,605 15,11,07,532 59,37,14,915
------------- ------------- --------------
626,01,26,954 370,64,07,681 1959,93,73,722
============= ============= ==============
EXPENDITURE
Software development expenses 318,32,88,293 189,39,05,266 958,17,66,650
Administration and other expenses 53,67,64,710 28,50,11,949 177,54,70,971
Provision for investments -- -- 15,28,98,608
------------- ------------- --------------
372,00,53,003 217,89,17,215 1151,01,36,229
Operating profit (PBIDT) 254,00,73,951 152,74,90,466 808,92,37,493
Interest -- -- --
Depreciation 35,48,03,492 17,73,71,717 112,89,45,152
Profit before tax and extraordinary item 218,52,70,459 135,01,18,749 696,02,92,341
Provision for taxation 28,50,00,000 13,71,00,000 72,71,00,000
Profit after tax before extraordinary item 190,02,70,459 121,30,18,749 623,31,92,341
Extraordinary item
- transfer of intellectual property rights (net of tax) -- 5,49,44,000 5,49,44,000
Net profit after tax and extraordinary item 190,02,70,459 126,79,62,749 628,81,36,341
------------- ------------- --------------
AMOUNT AVAILABLE FOR APPROPRIATION 190,02,70,459 126,79,62,749 628,81,36,341
------------- ------------- --------------
Dividend
Interim -- -- 16,53,78,418
Final -- -- 49,61,85,878
Dividend Tax -- -- 8,69,94,211
Amount transferred - general reserve -- -- 553,95,77,834
Balance in Profit and Loss Account 190,02,70,459 126,79,62,749 --
------------- ------------- --------------
190,02,70,459 126,79,62,749 628,81,36,341
============= ============= ==============
EARNINGS PER SHARE (equity shares, par value Rs. 5 each)
Basic 28.72 19.17 95.06
Diluted 28.59 18.93 94.76
Number of shares used in computing earnings per share
Basic 6,61,59,038 6,61,51,036 6,61,52,131
Diluted 6,64,65,149 6,69,81,506 6,63,58,311
============= ============= ==============
</TABLE>
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> <C>
Balaji Swaminathan N. R. Narayana Murthy Nandan M. Nilekani Deepak M. Satwalekar Marti G. Subrahmanyam Jitendra Vir Singh
Partner Chairman and Managing Director, Director Director Director
Chief Executive Officer President and
Chief Operating
Officer
Omkar Goswami Larry Pressler Rama Bijapurkar S. Gopalakrishnan K. Dinesh
Director Director Director Deputy Managing Director
Director
S. D. Shibulal T. V. Mohandas Pai Phaneesh Murthy Srinath Batni V. Balakrishnan
Director Director and Director Director Company Secretary and
Chief Financial Vice President -
Officer Finance
</TABLE>
Bangalore,
July 10, 2001
6
<PAGE> 7
Schedules to the Profit and Loss Account
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------
in Rs.
--------------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
OTHER INCOME
Interest received on deposits with banks and others 11,80,75,060 7,56,56,319 38,46,83,890
(Tax deducted at source Rs. 1,71,06,524; Rs. 69,02,206
and Rs. 4,30,12,428 respectively)
Miscellaneous income 42,47,253 12,75,233 73,18,542
Exchange differences (*) 1,26,17,292 7,41,75,980 20,17,12,483
------------- ------------- -------------
13,49,39,605 15,11,07,532 59,37,14,915
============= ============= =============
</TABLE>
(*) arising on translation of foreign currency deposits maintained abroad
includes a realized gain of Rs. Nil (quarter ended June 30, 2000 -- Rs. Nil;
year ended March 31, 2001 -- Rs. 5,06,25,885)
<TABLE>
<S> <C> <C> <C>
SOFTWARE DEVELOPMENT EXPENSES
Salaries and bonus including overseas staff expenses 251,16,36,702 131,59,03,108 675,86,45,286
Staff welfare 1,97,44,018 1,51,05,488 8,46,06,310
Contribution to provident and other funds 7,02,27,003 9,49,72,021 33,45,76,308
Foreign travel expenses 32,23,60,043 30,21,47,079 147,22,11,655
Consumables 39,15,735 90,94,196 5,86,87,245
Cost of software packages for
own use 7,99,74,683 7,54,06,306 31,85,81,751
banking product 4,00,58,029 83,50,829 5,70,13,753
Computer maintenance 1,18,19,183 1,48,09,400 7,19,42,078
Communication expenses 10,22,07,164 4,70,05,737 31,52,55,986
Consultancy charges 2,03,72,893 1,12,91,262 9,19,25,609
Provision for post-sales client support 9,72,840 (1,80,160) 1,83,20,669
------------- ------------- -------------
318,32,88,293 189,39,05,266 958,17,66,650
============= ============= =============
ADMINISTRATION AND OTHER EXPENSES
Professional charges 3,84,49,342 2,55,65,071 20,40,21,385
Traveling and conveyance 4,21,84,101 2,72,52,199 18,40,64,822
Rent 6,51,19,891 3,26,94,228 16,94,82,708
Telephone charges 4,24,42,313 2,91,31,034 14,02,60,363
Office maintenance 3,35,01,582 2,73,12,516 12,84,32,642
Power and fuel 4,62,90,782 2,06,50,482 11,78,45,258
Brand building 1,86,21,284 1,09,58,146 10,52,01,392
Donations 2,42,50,825 1,58,07,369 7,21,92,883
Advertisements 61,10,666 1,13,04,298 6,30,77,831
Printing and stationery 3,14,30,676 2,50,66,901 6,25,54,206
Insurance charges 1,27,62,786 52,89,398 5,17,55,298
Repairs to building 2,21,54,234 82,54,771 3,95,22,458
Repairs to plant and machinery 49,17,486 33,86,262 2,26,54,171
Rates and taxes 89,98,658 35,64,331 1,82,17,524
Commission charges 51,76,868 22,64,589 1,79,03,784
Bank charges and commission 4,80,367 5,30,303 59,39,483
Auditor's remuneration
audit fees 5,37,500 4,46,250 17,85,000
certification charges -- -- 2,00,000
out-of-pocket expenses 50,000 50,000 2,00,000
Bad loans and advances written off -- -- 4,141
Bad debts written off -- -- 27,70,254
Provision for doubtful loans and advances (7,660) (1,412) 7,11,816
Provision for bad and doubtful debts 6,93,64,922 40,87,456 19,27,45,549
Freight charges 12,09,911 5,43,906 55,72,484
Professional membership and seminar participation fees 53,52,852 28,91,627 2,17,10,613
Marketing expenses 1,53,54,280 53,23,041 4,26,87,545
Postage and courier 1,17,02,538 48,77,958 2,27,86,459
Books and periodicals 33,41,757 38,54,221 1,69,10,978
Commission to non-whole time directors 24,00,000 15,00,000 59,22,049
Sales promotion expenses 11,34,626 1,87,071 70,16,656
Transaction processing fee and filing fees 1,38,49,399 3,72,625 1,52,76,339
Research grants 25,00,000 25,00,000 1,00,00,000
Other miscellaneous expenses 70,82,724 93,47,308 2,60,44,880
------------- ------------- -------------
53,67,64,710 28,50,11,949 177,54,70,971
============= ============= =============
PROVISION FOR TAXATION
Current year
Income taxes 29,56,00,000 12,31,00,000 71,31,00,000
Deferred taxes (1,06,00,000) -- --
------------- ------------- -------------
28,50,00,000 12,31,00,000 71,31,00,000
Prior years -- 1,40,00,000 1,40,00,000
------------- ------------- -------------
28,50,00,000 13,71,00,000 72,71,00,000
============= ============= =============
</TABLE>
7
<PAGE> 8
1. Significant accounting policies and notes on accounts
--------------------------------------------------------------------------------
Company overview
Infosys Technologies Limited ("Infosys" or "the company") is a publicly held
company providing information technology ("IT") solutions principally to Fortune
500 and other established corporations. Infosys' range of services include IT
consulting and architecture, application development, e-commerce and Internet
consulting, and software maintenance. In addition, the company develops and
markets certain software products.
Infosys has 16 state-of-the-art offshore software development facilities located
throughout India and 7 off-site software development centers and a consulting
office overseas. The offshore software development facilities enable the Company
to provide high quality, cost-effective services to clients in a
resource-constrained environment. The company has its headquarters in Bangalore,
India, and offices in the Americas, Europe and Asia that provide marketing and
administrative support.
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 certain
recently issued accounting standards made mandatory by the ICAI effective
the current fiscal year and adopted by the company, as described below.
The ICAI has issued accounting standards on segment reporting, related
party disclosures, earnings per share and accounting for taxes on income
that became mandatory effective accounting periods commencing on or after
April 1, 2001. The company adopted the accounting standards on segment
reporting, related party disclosures and earnings per share from the year
ended March 31, 2001. The standards on accounting for leases and income
taxes have been adopted in the preparation of these financial statements.
The accounting standard on consolidated financial statements becomes
effective from April 1, 2001 should a company consolidate its financial
statements. Although Yantra Corporation, USA, is a subsidiary of Infosys
as per the Companies Act, 1956, the financial statements have not been
consolidated since the company does not have control as envisaged by the
accounting standard on consolidated financial statements issued by the
ICAI. The company does not have any investments in associates and
accordingly the related accounting standard, mandatory effective April 1,
2002, does not affect these financials statements.
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 revenue 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, provision for doubtful
debts, future obligations under employee retirement benefit plans and the
useful lives of fixed assets. Actual results could differ from those
estimates.
1.1.2 Revenue recognition
Revenue from software development on fixed-price contracts is recognized
according to the milestones achieved as specified in the contracts on the
proportionate-completion method based on the work completed. On time-and-
materials contracts, revenue is recognized based on software developed
and invoiced as per the terms of specific contracts. Annual Technical
Services revenue is recognized proportionately over the period in which
services are rendered. Revenue from the sale of user licenses for
software applications is recognized on transfer of the title in the user
license. Interest is recognized using the time-proportion method, based
on rates implicit in the transaction. Dividend income is recognized when
the company's right to receive dividend is established. Revenue from the
sale of special import licenses is recognized when the licenses are
transferred.
1.1.3 Expenditure
The cost of software user licenses purchased for software development and
the rendering of IT services is charged to revenue in the year the
software is acquired. Project costs in the nature of salaries, travel and
other expenses incurred on fixed price contracts, where milestones are
yet to be reached are classified as "Costs in excess of billings" in the
balance sheet. Charges relating to non-cancelable long-term operating
leases are computed on the basis of the lease rentals payable as per the
relevant lease agreements. Provisions are made for all known losses and
liabilities, future unforeseeable factors that may affect the profit on
fixed-price software development contracts and also towards likely
expenses for providing post-sales client support. The leave encashment
liability of the company is provided on the basis of an actuarial
valuation.
8
<PAGE> 9
1.1.4 Fixed assets and capital work-in-progress
Fixed assets are stated at cost, after reducing accumulated depreciation
until the date of the balance sheet. Direct costs are capitalized until
the assets are ready for use and include financing costs relating to any
borrowing attributable to acquisition. Capital work-in-progress includes
the cost of fixed assets that are not yet ready for their intended use,
advances paid to acquire fixed assets and the cost of assets not put to
use before the balance sheet date.
1.1.5 Depreciation
Depreciation on fixed assets is determined using the straight-line method
based on useful lives of assets as estimated by the company. Depreciation
for assets purchased/sold during the year is proportionately charged.
Individual assets acquired for less than Rs. 5,000/- are entirely
depreciated in the year of acquisition. Management estimates the useful
lives for the various fixed assets as follows:
<TABLE>
<S> <C> <C> <C>
Buildings 15 years Furniture and fixtures 5 years
Plant and machinery 5 years Vehicles 5 years
Computer equipment 2-5 years
</TABLE>
1.1.6 Retirement benefits to employees
1.1.6a Gratuity
In accordance with the Payment of Gratuity Act, 1972, Infosys provides
for gratuity, a defined benefit retirement plan (the "Gratuity Plan")
covering eligible employees. The Gratuity Plan provides a lump sum
payment to vested employees at retirement, death, incapacitation or
termination of employment, of an amount based on the respective
employee's salary and the tenure of employment.
Liabilities with regard to the Gratuity Plan are determined by actuarial
valuation, based upon which, the company contributes to the Infosys
Technologies Limited Employees' Gratuity Fund Trust (the "Trust").
Trustees administer contributions made to the Trust and invest in
specific designated securities as mandated by law, which generally
comprise central and state government bonds and debt instruments of
government-owned corporations.
1.1.6b Superannuation
Apart from being covered under the Gratuity Plan described above, certain
employees of Infosys are also participants of a defined contribution
plan. The company makes monthly contributions under the superannuation
plan (the "Plan") to the Infosys Technologies Limited Employees
Superannuation Fund Trust based on a specified percentage of each covered
employee's salary. The company has no further obligations to the Plan
beyond its monthly contributions.
1.1.6c Provident fund
Eligible employees also receive benefits from a provident fund, which is
a defined contribution plan. Both the employee and the company make
monthly contributions to this provident fund plan equal to a specified
percentage of the covered employee's salary.
Infosys contributes a part of the contributions to the Infosys
Technologies Limited Employees Provident Fund Trust. The remainders of
the contributions are made to the Government administered provident fund.
The company has no further obligations under the provident fund plan
beyond its monthly contributions.
1.1.7 Research and development
Revenue expenditure incurred on research and development is charged off
as incurred. Capital expenditure incurred on research and development is
depreciated over the estimated useful lives of the related assets.
1.1.8 Foreign currency transactions
Revenue from overseas clients and collections deposited in foreign
currency bank accounts are recorded at the exchange rate as of the date
of the respective transactions. Expenditure in foreign currency is
accounted at the exchange rate prevalent when such expenditure is
incurred. Disbursements made out of foreign currency bank accounts are
reported at a rate that approximates the actual monthly rate. Exchange
differences are recorded when the amount actually received on sales or
actually paid when expenditure is incurred is converted into Indian
Rupees. The exchange differences arising on foreign currency transactions
are recognized as income or expense in the period in which they arise.
Fixed assets purchased at overseas offices are recorded at cost, based on
the exchange rate as of the date of purchase. The charge for depreciation
is determined as per the company's accounting policy.
Current assets and current liabilities denominated in foreign currency
are translated at the exchange rate prevalent at the date of the balance
sheet. The resulting difference is also recorded in the profit and loss
account. In the case of forward contracts, the difference between the
forward rate and the exchange rate on the date of the transaction is
recognized as income or expense over the life of the contract.
9
<PAGE> 10
1.1.9 Income tax
Income taxes are computed using the tax effect accounting method, where
taxes are accrued in the same period the related revenue and expenses
arise. A provision is made for income tax annually based on the tax
liability computed after considering tax allowances and exemptions.
Provisions are recorded as considered appropriate for matters under
appeal due to disallowances or for other reasons.
The differences that result between the profit offered for income taxes
and the profit as per the financial statements are identified and
thereafter a deferred tax asset or deferred tax liability is recorded for
timing differences, namely the differences that originate in one
accounting period and reverse in another, based on the tax effect of the
aggregate amount being considered. The tax effect is calculated on the
accumulated timing differences at the end of an accounting period based
on prevailing enacted regulations. Deferred tax assets are recognized
only if there is reasonable certainty that they will be realized and are
reviewed for the appropriateness of their respective carrying values at
each balance sheet date.
1.1.10 Earnings per share
In determining earnings per share, the company considers the net profit
after tax and includes the post-tax effect of any extra-ordinary items.
The number of shares used in computing basic earnings per share is the
weighted average number of shares outstanding during the period. The
number of shares used in computing diluted earnings per share comprises
the weighted average shares considered for deriving basic earnings per
share, and also the weighted average number of equity shares which could
have been issued on the conversion of all dilutive potential equity
shares. Dilutive potential equity shares are deemed converted as of the
beginning of the period, unless they have been issued at a later date.
The diluted potential equity shares have been adjusted for the proceeds
receivable had the shares been actually issued at fair value (i.e. the
average market value of the outstanding shares). The number of shares and
potentially dilutive equity shares are adjusted for stock splits and
bonus shares, as appropriate.
1.1.11 Investments
Trade investments refer to the investments made with the aim of enhancing
the company's business interests in software development and services.
Investments are either classified as current or long-term. Current
investments are carried at the lower of cost and fair value. Cost for
overseas investments comprises the Indian Rupee value of the
consideration paid for the investment.
Long-term investments are carried at cost and provisions recorded to
recognize any decline, other than temporary, in the carrying value of
such investment.
The investment in the subsidiary (as per the Companies Act, 1956) is
accounted on the cost method, whereby, the investment is carried at cost
and the company recognizes only dividends received from the subsidiary as
income in the profit and loss account. Provisions are recorded to
recognize any decline, other than temporary, in the carrying value of the
investment.
1.2 Notes on accounts
The previous period's/year's figures have been recast/restated, wherever
necessary, to conform to the current period's classification.
1.2.1 Deferred income taxes
Consequent to the standard on accounting for taxes on income becoming
mandatory effective April 1, 2001, the company recorded the cumulative
net deferred tax credit of Rs. 15,53,00,000 until April 1, 2001, as an
addition to the general reserves. The deferred tax credit of Rs.
1,06,00,000 for the quarter ended June 30, 2001 is included in the
provision for taxation.
1.2.2 Capital commitments and contingent liabilities
a. The estimated amount of contracts remaining to be executed
on capital account, and not provided for (net of advances)
is Rs. 143,18,57,443 as at June 30, 2001. The amount of
such contracts as at June 30, 2000 was Rs. 118,86,56,390
and as at March 31, 2001 was Rs. 158,25,35,171.
b. The company has outstanding guarantees and counter
guarantees of Rs.11,97,30,000 as at June 30, 2001, to
various banks, in respect of the guarantees given by the
banks in favor of various government authorities. The
guarantees outstanding as at June 30, 2000 were Rs.
5,71,30,000 and as at March 31, 2001 were Rs. 6,83,05,000.
c. Claims against the company, not acknowledged as debts,
amounted to Rs. 4,52,10,368 as at June 30, 2001. Such
claims as at June 30, 2000 were Rs. 73,78,977 and as at
March 31, 2001 Rs. 8,75,532.
d. Outstanding forward contracts amounted to US$ 35,000,000
(approximately Rs. 166,13,75,000 at quarter end exchange
rates) at June 30, 2001. Such contracts as at June 30, 2000
were Rs. Nil and as at March 31, 2000 were US$ 20,000,000
(approximately Rs. 93,12,00,000 at year end exchange
rates).
10
<PAGE> 11
1.2.3 Quantitative details
The company is engaged in the development and maintenance of computer
software. The production and sale of such software cannot be expressed in
any generic unit. Hence, it is not possible to give the quantitative
details of sales and certain information as required under paragraphs 3,
4C and 4D of part II of Schedule VI to the Companies Act, 1956.
1.2.4 Imports (valued on the cost, insurance and freight basis)
<TABLE>
<CAPTION>
in Rs.
------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Capital goods 14,65,25,897 16,76,46,420 113,56,33,008
Software packages 1,66,61,395 61,84,284 1,67,88,389
------------ ------------ -------------
</TABLE>
1.2.5 Earnings in foreign exchange (on the receipts basis)
<TABLE>
<CAPTION>
in Rs.
------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Income from software development
services and products 585,75,27,673 304,28,30,950 1708,67,49,891
Interest received on deposits with banks 1,67,51,659 5,49,26,100 19,55,81,989
</TABLE>
Expenditure in foreign currency (on the payments basis)
<TABLE>
<CAPTION>
in Rs.
------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Travel expenses 20,90,93,035 17,70,40,100 107,69,86,908
Professional charges 3,43,03,690 72,06,920 14,63,89,491
Other expenditure incurred overseas
for software development 202,09,24,973 80,78,78,995 489,94,99,776
</TABLE>
Net earnings in foreign currency (on the receipts and payments basis)
<TABLE>
<CAPTION>
in Rs.
------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Net earnings in foreign exchange 360,99,57,634 210,56,31,035 1115,94,55,705
</TABLE>
1.2.6 Fixed assets
Depreciation on assets costing less than Rs. 5,000 each During the
quarter ended June 30, 2001, the company charged depreciation at 100% in
respect of assets costing less than Rs. 5,000 each, amounting to Rs.
2,85,88,155. The corresponding amount for the quarter ended June 30, 2000
was Rs. 3,40,36,128 and for the year ended March 31, 2001 was Rs.
34,99,43,502.
Profit/loss on disposal of fixed assets
The company recorded a profit of Rs. 2,93,670 on the sale of fixed assets
during the quarter ended June 30, 2001. The loss charged for the quarter
ended June 30, 2000 is Rs. 45,109 and the profit for the year ended March
31, 2001 was Rs. 9,17,890.
1.2.7 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>
in Rs.
------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Lease rentals paid during the period/year 6,51,19,891 3,26,94,228 16,94,82,708
</TABLE>
11
<PAGE> 12
<TABLE>
<CAPTION>
Lease obligations As at June 30, As at March 31,
2001 2000 2001
------------ ------------ ---------------
<S> <C> <C> <C>
Within one year of the balance sheet date 11,10,41,975 4,43,04,530 7,30,43,980
Due in a period between one year and five years 35,80,20,475 14,82,21,361 27,71,79,409
Due after five years 4,12,29,308 4,35,12,036 14,40,05,657
------------ ------------ ------------
51,02,91,758 23,60,37,927 49,42,29,046
------------ ------------ ------------
</TABLE>
The operating lease arrangements extend for a maximum of 10 years from
their respective dates of inception and relate to rented overseas
premises.
1.2.8 Managerial remuneration paid to the chairman, managing director
and whole-time directors
<TABLE>
<CAPTION>
in Rs.
----------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000(*) March 31, 2001(*)
------------- ------------- --------------
<S> <C> <C> <C>
Salary 44,39,262 22,64,968 1,54,84,785
Contribution to provident fund and other funds 4,79,325 3,83,405 18,29,116
Perquisites and incentives 67,41,120 7,39,873 89,20,426
</TABLE>
(*) includes the remuneration paid to three directors who were co-opted
into the board on May 27, 2000.
1.2.9 Managerial remuneration paid to non-whole-time directors
<TABLE>
<CAPTION>
in Rs.
-----------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Commission -- -- 59,22,049
Sitting fees 1,30,000 1,12,000 2,57,000
Reimbursement of expenses 8,38,244 2,04,161 9,09,070
</TABLE>
1.2.10 Exchange differences
<TABLE>
<CAPTION>
in Rs.
----------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Gains on the translation of foreign currency deposits 1,26,17,292 7,41,75,980 20,17,12,483
Net realized and unrealized exchange gains - others 3,62,20,186 7,63,71,369 19,45,83,779
Total net realized and unrealized gains 4,88,37,478 15,05,47,349 39,62,96,262
</TABLE>
Total realized and unrealized exchange gains comprise, gains on the
translation of foreign currency deposits which is classified as "other
income" and net realized and unrealized exchange gains, which are
classified as "Income from software development services and products --
overseas".
1.2.11 Research and development expenditure
<TABLE>
<CAPTION>
in Rs.
----------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Capital 7,71,248 20,02,050 2,14,29,903
Revenue 3,85,05,021 3,15,82,490 14,97,08,196
Total research and development expenses 3,92,76,269 3,35,84,540 17,11,38,099
</TABLE>
1.2.12 Unearned revenue
Unearned revenue as at June 30, 2001 amounting to Rs. 36,28,63,771 (as at
June 30, 2000 - Rs. 64,25,65,243 and as at March 31, 2001 - Rs.
34,82,60,201) primarily consists of client billings on fixed-price,
fixed-time-frame contracts for which the related costs have not yet been
incurred.
1.2.13 Dues to small-scale industrial undertakings
As at June 30, 2001, the company had no outstanding dues to small-scale
industrial undertakings (as at June 30, 2000 - Rs. Nil and as at March
31, 2001 - Rs. Nil).
1.2.14 Balance of unutilized money raised by issue of American Depositary
Shares ("ADSs")
During the year ended March 31, 1999, Infosys made an Initial Public
Offering of ADS, of US$ 70,380,000, equivalent to Rs. 296,86,00,000. The
issue proceeds net of expenses of Rs. 19,68,00,000 are entirely utilized
as of the year ended March 31, 2001. The unutilized ADSs proceeds as at
June 30, 2001 are Rs. Nil (as at June 30, 2000 - Rs. 66,13,00,000 and as
at March 31, 2001 - Rs. Nil).
12
<PAGE> 13
1.2.15 Stock option plans
The company currently has three stock option plans. These are summarized
below.
1994 Stock Option Plan (the "1994 Plan")
As of June 30, 2001 the options to acquire 2,69,000 shares were
outstanding with the Employee Welfare Trust and options to acquire
3,24,600 shares are outstanding with the employees under the 1994 Plan.
These options were granted at an exercise price of Rs. 50 (post split)
per option. Additionally, 14,15,000 shares earlier issued are subject to
lock-in. No options were issued under this plan during the period.
1998 Stock Option Plan (the "1998 Plan")
The 1998 Plan provides for the grant of stock options to employees. The
board of directors approved the 1998 Plan in December 1997 and by the
shareholders in January 1998. The Government of India approved 29,40,000
ADSs representing 14,70,000 equity shares for issue under the Plan. The
options may be issued at an exercise price that is not less than 90% of
the fair market value of the underlying equity share on the date of the
grant. The 1998 Plan automatically expires in January 2008, unless
terminated earlier. All options under the 1998 Plan are exercisable for
ADSs representing equity shares. A compensation committee comprising
independent members of the board of directors administers the 1998 Plan.
<TABLE>
<CAPTION>
Number of options granted, exercised and forfeited Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Options granted, beginning of period/year 15,65,506 6,89,500 6,89,500
Granted during the period/year 97,800 1,46,700 9,64,840
Exercised during the period/year (5,200) (1,334) (12,434)
Forfeited during the period/year (31,620) (11,500) (76,400)
Options granted, end of period/year 16,26,486 8,23,366 15,65,506
--------- --------- ---------
Weighted average exercise price US$ 88.57 US$ 77.06 US$ 90.98
Rs. 4,162 Rs. 3,440 Rs. 4,236
--------- --------- ---------
</TABLE>
1999 Stock Option Plan (the "1999 Plan")
In fiscal 2000, the company instituted the 1999 Plan. The shareholders
and the board of directors approved the plan in June 1999, which provides
for the issue of 66,00,000 equity shares to the employees. The
compensation committee administers the 1999 Plan. Options will be issued
to employees at an exercise price that is not less than the fair market
value.
Fair market value is the closing price of the company's shares in the
stock exchange, where there is the highest trading volume on a given date
and if the shares are not traded on that day, the closing price on the
next trading day.
Under the 1999 Plan, options may be issued to employees at exercise
prices that are less than the fair market value only if specifically
approved by the members of the company in a general meeting. No approval
has been sought to date in this regard.
<TABLE>
<CAPTION>
Number of options granted, exercised and forfeited Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Options granted, beginning of period/year 27,93,980 10,06,800 10,06,800
Granted during the period/year 4,15,250 6,58,650 19,57,830
Exercised during the period/year -- -- (1,200)
Forfeited during the period/year (41,860) (23,600) (1,69,450)
Options granted, end of period/year 31,67,370 16,41,850 27,93,980
--------- --------- ---------
Weighted average exercise price Rs. 5,346 Rs. 4,931 Rs. 5,572
--------- --------- ---------
</TABLE>
The aggregate options outstanding and considered for dilution as at June
30, 2001 are 39,80,613 (as at June 30, 2000 - 20,53,533 options and as at
March 31, 2001- 35,76,733 options).
1.2.16 Pro-forma disclosures relating to the Employee Stock Option Plans
("ESOPs")
The Securities and Exchange Board of India (SEBI) issued the Employee
Stock Option Scheme and Employee Stock Purchase Scheme Guidelines in
1999, which is applicable to all stock option schemes established on or
after June 19, 1999. In accordance with these guidelines, the excess of
the market price of the underlying equity shares as of the date of the
grant of the options over the exercise price of the options, including
up-front payments, if any, is to be recognized and amortized on a
straight-line basis over the vesting period. All options under the 1998
and 1999 stock option plans have been issued at fair market value, hence
there are no compensation costs.
The company's 1994 stock option plan was established prior to the SEBI
guidelines on stock options.
13
<PAGE> 14
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>
in Rs.
---------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
<S> <C> <C> <C>
Net profit:
As reported 190,02,70,459 126,79,62,749 628,81,36,341
Adjusted pro forma 184,11,62,755 121,14,70,502 605,55,42,584
</TABLE>
1.2.17 Provision for taxation
The company's profits from export activities are partly deductible from
taxable income. However, most of Infosys' operations are conducted
through 100% Export Oriented Units ("EOU"), which are entitled to a tax
holiday for a period of 10 years from the date of commencement of
operations. The Government of India amended the tax incentive available
to companies operating through EOUs. The tenure of tax exemption
available to such companies is restricted to a maximum of 10 consecutive
years commencing from the fiscal year in which the unit commences
software development and expires on March 31, 2009. Additionally, export
related tax deductions apart from the 100% EOU scheme earlier described
are being phased out by fiscal 2004. The provision for taxation includes
tax liabilities in India on the company's global income as reduced by
exempt incomes and any tax liabilities arising overseas on income sourced
from those countries.
1.2.18 Cash and bank balances
Details of balances kept with non-scheduled banks as on balance sheet
dates and the maximum balances kept with non-schedule banks during the
period/year are as follows:
<TABLE>
<CAPTION>
in Rs.
-----------------------------------------------------------------------------------------------------------------
Balances with non-scheduled banks As at June 30, As at March 31,
2001 2000 2001
------------ ------------ ---------------
<S> <C> <C> <C>
In deposit account in foreign currency
HSBC Bank Middle East, Bahrain -- 69,43,99,799 --
------------ ------------ ------------
-- 69,43,99,799 --
------------ ------------ ------------
In current accounts
ABN Amro Bank, Heerlen, Netherlands -- 15,95,544 --
ABN Amro Bank, Brussels, Belgium 10,31,831 13,26,688 8,73,096
Bank of America, Concord, USA 2,15,66,340 -- 27,09,344
Bank of America, Hong Kong 6,88,913 -- 4,25,885
Bank of America, Los Angeles, USA -- 11,88,502 --
Bank of America, Milpitas, USA -- 3,52,03,130 23,59,820
Bank of America, Palo Alto, USA 43,94,71,834 51,53,93,175 35,70,97,922
Bank of Boston, Boston, USA 60,83,049 5,46,035 21,30,626
Bank of Melbourne, Melbourne, Australia 14,45,702 11,10,636 17,26,245
Bank of Melbourne, Victoria, Australia 3,82,761 -- 5,46,759
Barclays Bank, London, UK 37,69,185 37,03,573 38,36,868
Deutsche Bank, Frankfurt, Germany 10,47,613 36,94,391 20,22,282
First Chicago Bank, Chicago, USA -- 16,42,693 --
Hong Kong Bank of Canada, Toronto, Canada 5,17,677 38,77,993 5,54,537
HSBC Bank PLC - Croydon, London 18,93,61,988 -- 9,76,68,994
Michigan National Bank, Detroit, USA -- 13,58,243 --
Nations Bank, Dallas, USA 1,12,89,082 1,28,80,583 1,17,15,900
Nations Bank, Georgia, USA -- 16,88,456 --
National Bank of Sharjah, UAE 14,08,179 -- --
Nordbanken, Stockholm, Sweden 12,82,320 16,97,129 15,86,376
Nova Scotia Bank, Toronto, Canada 5,30,93,094 1,28,52,421 5,21,19,103
Seafirst Bank, Seattle, USA -- 25,84,499 --
Sanwa Bank, Tokyo, Japan 23,48,934 39,29,641 12,18,670
Summit Bank, Bridgewater, USA 35,44,309 30,99,673 14,75,012
------------ ------------ ------------
73,83,32,811 60,93,73,005 54,00,67,439
------------ ------------ ------------
</TABLE>
14
<PAGE> 15
<TABLE>
<CAPTION>
Maximum balance held in non-scheduled
banks during the period/year Quarter ended June 30, Year ended
2001 2000 March 31, 2001
------------ ------------ --------------
<S> <C> <C> <C>
in deposit account in foreign currency
HSBC Bank Middle East, Bahrain -- 69,43,99,799 72,78,38,970
in current accounts
ABN Amro Bank, Heerlen, Netherlands -- 15,95,544 15,95,544
ABN Amro Bank, Brussels, Belgium 18,31,307 16,26,311 25,10,415
Bank of America, Concord, USA 5,53,09,105 -- 11,56,12,302
Bank of America, Hong Kong 10,70,247 -- 11,81,752
Bank of America, Los Angeles, USA -- 50,65,143 3,08,58,501
Bank of America, Milpitas, USA 28,83,464 3,52,03,130 5,89,07,898
Bank of America, Palo Alto, USA 63,57,70,026 69,60,58,192 92,96,33,056
Bank of Boston, Boston, USA 60,98,815 28,18,994 72,15,459
Bank of Melbourne, Melbourne, Australia 27,69,994 11,56,382 17,26,245
Bank of Melbourne, Victoria, Australia 21,32,997 -- 16,34,330
Barclays Bank, London, UK 38,78,448 57,24,186 3,63,48,726
Deutsche Bank, Frankfurt, Germany 56,90,413 36,94,391 36,94,391
First Chicago Bank, Chicago, USA -- 22,07,085 22,07,085
Hong Kong Bank of Canada, Toronto, Canada 5,54,537 1,01,66,688 1,01,66,688
HSBC Bank PLC - Croydon, London 24,49,63,498 -- 16,51,68,657
Michigan National Bank, Detroit, USA -- 17,44,660 17,44,660
National Bank of Sharjah, UAE 14,08,179 -- --
Nations Bank, Dallas, USA 2,55,96,002 2,04,48,137 3,36,69,804
Nations Bank, Georgia, USA -- 21,33,612 21,33,612
Nordbanken, Stockholm, Sweden 17,51,168 16,97,129 23,20,446
Nova Scotia Bank, Toronto, Canada 9,66,13,821 1,28,52,421 7,57,18,591
Seafirst Bank, Seattle, USA -- 31,46,158 31,46,158
Sanwa Bank, Tokyo, Japan 1,15,86,471 48,69,517 1,40,25,843
Summit Bank, Bridgewater, USA 83,25,596 35,11,056 88,91,861
------------ ------------ ------------
</TABLE>
The cash and bank balances include interest accrued but not due on fixed
deposits amounting to Rs. 2,69,09,484 for the quarter ended June 30, 2001
(the quarter ended June 30, 2000 - Rs. 27,33,684 and the year ended March
31, 2001 - Rs. 1,94,43,708).
1.2.19 Loans and advances
"Advances" mainly comprises prepaid travel and per-diem expenses and
advances to vendors. Deposits with financial institutions and a body
corporate comprise:
<TABLE>
<CAPTION>
in Rs.
--------------------------------------------------------------------------------------------------------------
As at June 30, As at March 31,
2001 2000 2001
------------- ------------ ---------------
<S> <C> <C> <C>
Deposits with financial institutions:
Housing Development Finance Corporation Limited 50,76,20,299 10,41,44,577 50,87,03,015
ICICI Limited 31,41,17,812 10,20,30,140 50,87,01,373
IDBI Limited 51,49,98,314 -- 40,35,30,424
Deposits with body corporate:
GE Capital Services India Limited 50,54,96,783 25,31,55,167 50,58,17,345
------------- ------------ -------------
184,22,33,208 45,93,29,884 192,67,52,157
------------- ------------ -------------
</TABLE>
The above amounts include interest accrued but not due amounting to Rs.
3,22,33,208 (the quarter ended June 30, 2000 -- Rs. 93,29,884 and the
year ended March 31, 2001 -- Rs. 2,67,52,157).
The financial institutions and the body corporate have superior credit
ratings from a premier credit rating agency in the country.
Mr. Deepak M. Satwalekar, Director, is also Director of HDFC. Mr. N. R.
Narayana Murthy, Chairman and CEO, and Prof. Marti G. Subrahmanyam,
Director, are also directors in ICICI Limited. Except as directors in
these financial institutions, these persons have no direct interest in
these transactions.
1.2.20 Current liabilities
Sundry creditors for other liabilities represent mainly the retention
amounts payable to the vendors, and amounts accrued for various other
operational expenses and taxes.
1.2.21 Fixed assets
The company has entered into lease-cum-sale agreements to acquire certain
properties. In accordance with the terms of these agreements, the company
has the option to purchase the properties on expiry of the lease period.
The company has already paid 99% of the value of the properties at the
time of entering into the lease-cum-sale agreements. These amounts are
disclosed as "Land - leasehold" under "Fixed assets" in the financial
statements.
15
<PAGE> 16
1.2.22 Transfer of intellectual property rights
During the year ended March 31, 2001, the company transferred its
intellectual property rights in OnScan - a web- focused wireless-enabled
notification product, to OnMobile Systems, Inc. (formerly OnScan Inc.)
USA, a company incubated by Infosys as part of its ongoing effort to
encourage and promote budding entrepreneurs among its employees. The
rights were transferred for Rs. 8,93,40,000 (US$ 2 million), received as
equity, preferred voting and preferred non-voting securities in OnMobile
Systems, Inc. The income of Rs. 5,49,44,000 (net of tax) arising on the
transfer is disclosed as an extraordinary item in the statement of profit
and loss of that year. The transaction was completed in the quarter ended
June 30, 2000.
The item has not been considered in the statement of cash flows since it
is a non-cash transaction except for the payment of the related income
tax.
1.2.23 Investments
Workadia Inc., USA
During the quarter ended June 30, 2001, the company made a strategic
investment of Rs. 10,32,68,000 comprising 4,40,000 fully paid Series "B"
convertible preferred stock, par value of US$ 0.001, at US$ 5.00 each, in
Workadia, Inc., USA ("Workadia"). Workadia will provide companies with
comprehensive, customizable business intranets through browser accessed
hosted portals and also offer consulting services to help customers
select and deploy their intranet applications, content and services.
Other information
During the year ended March 31, 2001, the company made strategic
investments aggregating to Rs. 26,63,94,960 in Alpha Thinx Mobile Phone
Services AG, Austria ("Alpha Thinx"); Asia Net Media BVI Limited, the
British Virgin Islands; CiDRA Corporation, USA ("CiDRA"); M-Commerce
Ventures Pte. Limited, Singapore; and Purpleyogi Inc., USA.
Of the above investments, the company invested Rs. 13,40,08,660 in CiDRA
during the quarter ended June 30, 2000. There were no provisions as of
the quarter ended June 30, 2000.
An amount of Rs. 15,28,98,608 was provided for the investments in Alpha
Thinx and EC Cubed, Inc., USA, during the year ended March 31, 2001, when
the investee companies filed for liquidation.
1.2.24 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 revenue 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
retailing industries; and others such as utilities, transportation and
logistics companies.
Revenue 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. The
company believes that it is currently not practicable to provide segment
disclosures relating to total assets and liabilities since a meaningful
segregation of the available data is onerous.
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.
16
<PAGE> 17
Industry segments
<TABLE>
<CAPTION>
in Rs.
-----------------------------------------------------------------------------------------------------------------------------------
Quarter ended June 30, 2001 Financial services Manufacturing Telecom Retail Others Total
--------------------------- ------------------ ------------- ------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Revenues 225,58,15,275 112,39,92,830 102,27,63,867 68,04,42,241 104,21,73,136 612,51,87,349
Identifiable operating expenses 78,15,77,975 44,60,90,828 25,93,53,742 18,15,68,558 36,55,70,440 203,41,61,543
Allocated expenses 64,61,93,970 30,20,16,064 27,48,15,915 18,28,34,341 28,00,31,170 168,58,91,460
Segmental operating income 82,80,43,330 37,58,85,938 48,85,94,210 31,60,39,342 39,65,71,526 240,51,34,346
Unallocable expenses 35,48,03,492
-------------
Operating income 205,03,30,854
Other income (expense), net 13,49,39,605
-------------
Net profit before taxes 218,52,70,459
Income taxes 28,50,00,000
-------------
Net profit after taxes 190,02,70,459
=============
</TABLE>
<TABLE>
<CAPTION>
Quarter ended June 30, 2000 Financial services Manufacturing Telecom Retail Others Total
--------------------------- ------------------ ------------- ------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Revenues 104,52,58,244 70,75,04,730 65,77,30,528 31,99,77,014 82,48,29,633 355,53,00,149
Identifiable operating expenses 44,57,33,666 25,67,43,679 18,17,52,649 12,03,85,355 27,81,28,026 128,27,43,375
Allocated expenses 26,93,70,795 17,66,76,779 16,42,47,257 7,99,04,072 20,59,74,937 89,61,73,840
Segmental operating income 33,01,53,783 27,40,84,272 31,17,30,622 11,96,87,587 34,07,26,670 137,63,82,934
Unallocable expenses 17,73,71,717
-------------
Operating income 119,90,11,217
Other income (expense), net 15,11,07,532
-------------
Net profit before taxes 135,01,18,749
Income taxes 13,71,00,000
-------------
Net profit after taxes 121,30,18,749
=============
</TABLE>
<TABLE>
<CAPTION>
Year ended March 31, 2001 Financial services Manufacturing Telecom Retail Others Total
--------------------------- ------------------ ------------- ------------- ------------ ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Revenues 640,77,55,042 338,84,20,263 350,11,16,331 172,86,39,345 397,97,27,826 1900,56,58,807
Identifiable operating expenses 225,87,90,591 130,66,14,108 88,39,38,378 54,74,24,303 120,92,12,385 620,59,79,765
Allocated expenses 177,68,81,844 90,69,15,538 93,89,68,074 46,30,82,749 106,54,09,651 515,12,57,856
Segmental operating income 237,20,82,607 117,48,90,617 167,82,09,879 71,81,32,293 170,51,05,790 764,84,21,186
Unallocable expenses 128,18,43,760
--------------
Operating income 636,65,77,426
Other income (expense), net 59,37,14,915
--------------
Net profit before taxes 696,02,92,341
Income taxes 72,71,00,000
--------------
Net profit after taxes 623,31,92,341
==============
</TABLE>
Geographic segments
<TABLE>
<CAPTION>
Quarter ended June 30, 2001 North America Europe India Rest of the World Total
--------------------------- ------------- ------------- ------------ ----------------- -------------
<S> <C> <C> <C> <C> <C>
Revenues 442,08,60,840 121,41,46,804 16,21,65,862 32,80,13,843 612,51,87,349
Identifiable operating expenses 142,17,68,385 43,03,39,633 4,84,21,938 13,36,31,587 203,41,61,543
Allocated expenses 120,12,05,791 32,98,99,589 6,14,83,134 9,33,02,946 168,58,91,460
Segmental operating income 179,78,86,664 45,39,07,582 5,22,60,790 10,10,79,310 240,51,34,346
Unallocable expenses 35,48,03,492
-------------
Operating income 205,03,30,854
Other income (expense), net 13,49,39,605
-------------
Net profit before taxes 218,52,70,459
Income taxes 28,50,00,000
-------------
Net profit after taxes 190,02,70,459
=============
</TABLE>
<TABLE>
<CAPTION>
Quarter ended June 30, 2000 North America Europe India Rest of the World Total
--------------------------- ------------- ------------- ------------ ----------------- -------------
<S> <C> <C> <C> <C> <C>
Revenues 264,83,86,416 60,98,27,474 4,47,21,726 25,23,64,533 355,53,00,149
Identifiable operating expenses 94,89,69,281 22,57,03,906 1,69,12,413 9,11,57,775 128,27,43,375
Allocated expenses 66,57,79,233 15,33,04,845 1,23,54,855 6,47,34,907 89,61,73,840
Segmental operating income 103,36,37,902 23,08,18,723 1,54,54,458 9,64,71,851 137,63,82,934
Unallocable expenses 17,73,71,717
-------------
Operating income 119,90,11,217
Other income (expense), net 15,11,07,532
-------------
Net profit before taxes 135,01,18,749
Income taxes 13,71,00,000
-------------
Net profit after taxes 121,30,18,749
=============
</TABLE>
17
<PAGE> 18
<TABLE>
<CAPTION>
in Rs.
----------------------------------------------------------------------------------------------------------------------------------
Year ended March 31, 2001 North America Europe India Rest of the World Total
------------------------- -------------- ------------- ------------ ----------------- --------------
<S> <C> <C> <C> <C> <C>
Revenues 1396,90,84,594 358,05,91,607 26,53,92,386 119,05,90,220 1900,56,58,807
Identifiable operating expenses 443,71,64,129 125,44,88,260 8,95,83,246 42,47,44,130 620,59,79,765
Allocated expenses 377,03,71,740 96,78,27,796 8,59,85,652 32,70,72,668 515,12,57,856
Segmental operating income 576,15,48,725 135,82,75,551 8,98,23,488 43,87,73,422 764,84,21,186
Unallocable expenses 128,18,43,760
--------------
Operating income 636,65,77,426
Other income (expense), net 59,37,14,915
--------------
Net profit before taxes 696,02,92,341
Income taxes 72,71,00,000
--------------
Net profit after taxes 623,31,92,341
==============
</TABLE>
1.2.25 Related party transactions
The company entered into related party transactions during the quarter
with Yantra Corporation, USA, the subsidiary of the company, and key
management personnel.
The transactions with Yantra Corporation comprise sales of Rs.
1,52,48,460 during the quarter ended June 30, 2001 (the quarter ended
June 30, 2000 -- Rs. 5,18,56,649 and the year ended March 31, 2001 - Rs.
19,64,85,967). The outstanding dues from the subsidiary as at June 30,
2001 are Rs. 46,90,468 (as at June 30, 2000 - Rs. 1,68,19,590 and as at
March 31, 2001 - Rs. 99,80,017).
Key management personnel are non-director officers of the company, who
have the authority and responsibility for planning, directing and
controlling the activities of the company. The loans and advances
receivable from non-director officers as at June 30, 2001 are Rs.
2,04,62,199 (as at June 30, 2000 - Rs. 1,51,84,336 and as at March 31,
2001 - Rs. 1,05,74,738).
1.2.26 Provisions for doubtful debts
Periodically, the company evaluates all customer dues to the company for
collectibles. The need for provisions is assessed based on various
factors including collectibles of specific dues, risk perceptions of the
industry in which the customer operates, general economic factors, which
could effect the customer's ability to settle. The company normally
provides for debtor dues outstanding for 180 days or longer. As at June
30, 2001 the company has provided for doubtful debts of Rs. 9,44,42,708
(as at June 30, 2000 -- Rs. Nil and as at March 31, 2001 -- Rs.
8,55,48,753) on dues from certain customers although the outstanding
amounts were less than 180 days old, since the amounts were considered
doubtful of recovery. The company continues pursuing the parties for
recovery of the dues, in part or full.
1.2.27 Dividends remitted in foreign currencies
Infosys does not make any direct remittances of dividends in foreign
currency. The company remits the equivalent of the dividends payable to
the holders of ADS ("ADS holders") in Indian Rupees to the depositary
bank, which is the registered shareholder on record for all owners of the
company's ADSs. The depositary bank purchases the foreign currencies and
remits dividends to the ADS holders.
Particulars of dividends remitted are as follows:
<TABLE>
<CAPTION>
Particulars Number of shares
to which the Quarter ended Year ended
dividends relate June 30, 2001 June 30, 2000 March 31,2001
---------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Final dividend for fiscal 2000 2,081,900 -- 62,11,810 62,11,810
Interim dividend for fiscal 2001 2,082,567 -- -- 52,06,417
Final dividend for fiscal 2001 2,088,517 1,56,63,878 -- --
----------- --------- -----------
1,56,63,878 62,11,810 1,14,18,227
----------- --------- -----------
</TABLE>
1.2.28 Reconciliation of basic and diluted shares used in computing
earnings per share
<TABLE>
<CAPTION>
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Number of shares considered as basic weighted
average shares outstanding 6,61,59,038 6,61,51,036 6,61,52,131
Add: Effect of dilutive issues of shares/stock options 3,06,111 8,30,470 2,06,180
----------- ----------- -----------
Number of shares considered as weighted
average shares and potential shares outstanding 6,64,65,149 6,69,81,506 6,63,58,311
----------- ----------- -----------
</TABLE>
18
<PAGE> 19
Statement of Cash Flows
<TABLE>
<CAPTION>
in Rs.
-----------------------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax 218,52,70,459 135,01,18,749 696,02,92,341
Adjustments to reconcile profit before tax to cash provided
by operating activities
(Profit)/loss on sale of fixed assets (2,93,670) 45,109 (9,17,890)
Depreciation and amortization 35,48,03,492 17,73,71,717 112,89,45,152
Interest income (11,80,75,060) (7,56,56,319) (38,46,83,890)
Effect of deferred taxes (1,06,00,000) -- --
Provisions on long-term investments -- -- 15,28,98,608
Provision for e-inventing -- (39,00,977) --
Income taxes paid during the period/year (37,88,96,758) (8,66,32,475) (85,18,05,440)
Exchange differences on translation of foreign currency deposits (1,26,17,292) (7,41,75,980) (20,17,12,483)
Changes in current assets and liabilities
Sundry debtors (6,75,04,785) (92,22,10,579) (166,19,21,164)
Loans and advances (8,94,66,842) (8,10,46,519) (34,72,64,731)
Current liabilities and provisions 19,71,17,386 41,34,59,784 60,92,54,409
------------- ------------- -------------
NET CASH GENERATED BY OPERATING ACTIVITIES 205,97,36,930 69,73,72,510 540,30,84,912
------------- ------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds on exercise of stock options 41,39,313 10,01,506 2,37,85,906
Dividends paid during the period/year, including dividend tax (54,67,96,837) (22,02,44,213) (42,20,05,883)
------------- ------------- -------------
NET CASH USED IN FINANCING ACTIVITIES (54,26,57,524) (21,92,42,707) (39,82,19,977)
------------- ------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets and change in capital work-in-progress (101,73,74,001) (85,83,69,973) (463,35,45,172)
Proceeds on disposal of fixed assets 6,34,274 50,738 22,73,671
Long-term investments in securities (10,32,68,000) (13,40,08,660) (26,63,64,960)
Interest income 11,80,75,060 7,56,56,319 38,46,83,890
------------- ------------- -------------
NET CASH USED IN INVESTING ACTIVITIES (100,19,32,667) (91,66,71,576) (451,29,52,571)
------------- ------------- -------------
Effect of exchange differences on
foreign currency deposits translations 1,26,17,292 7,41,75,980 20,17,12,483
Net increase/(decrease) in
cash and cash equivalents during the period/year 52,77,64,031 (36,43,65,793) 69,36,24,847
CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE PERIOD/YEAR 577,73,62,442 508,37,37,595 508,37,37,595
------------- ------------- -------------
CASH AND CASH EQUIVALENTS AT THE
END OF THE PERIOD/YEAR 630,51,26,473 471,93,71,802 577,73,62,442
============= ============= =============
</TABLE>
This is the Statement of Cash Flows referred to in our certificate of even date.
for Bharat S Raut & Co.
Chartered Accountants
<TABLE>
<S> <C> <C> <C> <C> <C>
Balaji Swaminathan N. R. Narayana Murthy Nandan M. Nilekani Deepak M. Satwalekar Marti G. Subrahmanyam Jitendra Vir Singh
Partner Chairman and Managing Director, Director Director Director
Chief Executive Officer President and
Chief Operating
Officer
Omkar Goswami Larry Pressler Rama Bijapurkar S. Gopalakrishnan K. Dinesh
Director Director Director Deputy Managing Director
Director
S. D. Shibulal T. V. Mohandas Pai Phaneesh Murthy Srinath Batni V. Balakrishnan
Director Director and Director Director Company Secretary and
Chief Financial Vice President -
Officer Finance
</TABLE>
Bangalore,
July 10, 2001
AUDITORS' CERTIFICATE TO THE MEMBERS OF INFOSYS TECHNOLOGIES LIMITED
We have examined the cash flow statement of Infosys Technologies Limited (the
company) for the quarter ended June 30, 2001. The statement has been prepared by
the company in accordance with the requirements of Clause 32 of the listing
agreements entered into with Indian Stock Exchanges.
for Bharat S Raut & Co.
Chartered Accountants
Bangalore Balaji Swaminathan
July 10, 2001 Partner
19
<PAGE> 20
Statement of Cash flows
<TABLE>
<CAPTION>
in Rs.
----------------------------------------------------------------------------------------------------------------------------------
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
INCOME TAXES PAID DURING THE PERIOD/YEAR
Charge as per the Profit and Loss Account 28,50,00,000 13,71,00,000 72,71,00,000
Add: Tax provided on intellectual property rights transferred -- 3,43,96,000 3,43,96,000
Increase in advance income taxes 37,40,37,462 8,66,32,475 69,33,01,439
Less: Increase/(decrease) in income tax provision (28,01,40,704) (17,14,96,000) (60,29,91,999)
------------- ------------- -------------
37,88,96,758 8,66,32,475 85,18,05,440
============= ============= =============
CHANGE IN LOANS AND ADVANCES DURING THE PERIOD/YEAR
As per the Balance Sheet 468,17,78,978 196,24,84,174 430,27,93,623
Less: Deposits with financial institutions and
body corporate, included in cash and cash equivalents (184,22,33,208) (45,93,29,884) (192,67,52,157)
Advance income taxes separately considered (161,14,35,254) (63,07,28,828) (123,73,97,792)
------------- ------------- -------------
122,81,10,516 87,24,25,462 113,86,43,674
Less: Opening balance considered (113,86,43,674) (79,13,78,943) (79,13,78,943)
------------- ------------- -------------
8,94,66,842 8,10,46,519 34,72,64,731
============= ============= =============
CHANGE IN CURRENT LIABILITIES AND PROVISIONS DURING THE PERIOD/YEAR
As per the Balance Sheet 312,89,62,704 202,05,13,013 319,85,01,451
Add/ Provisions separately considered in the Cash flow Statement
(less): Income taxes (150,91,52,445) (79,75,15,742) (122,90,11,741)
Provision for e-inventing -- 39,00,977 --
Dividends -- -- (49,61,85,878)
Dividend tax -- -- (5,06,10,959)
------------- ------------- -------------
161,98,10,259 122,68,98,248 142,26,92,873
Less: Opening balance considered (142,26,92,873) (81,34,38,464) (81,34,38,464)
------------- ------------- -------------
19,71,17,386 41,34,59,784 60,92,54,409
============= ============= =============
PURCHASE OF FIXED ASSETS AND CHANGE IN CAPITAL
WORK-IN-PROGRESS
As per the Balance Sheet 108,37,62,886 89,75,14,694 349,66,44,427
Less: Opening capital work-in-progress (170,65,04,250) (56,96,03,505) (56,96,03,505)
Add: Closing capital work-in-progress 164,01,15,365 53,04,58,784 170,65,04,250
------------- ------------- -------------
101,73,74,001 85,83,69,973 463,35,45,172
============= ============= =============
LONG-TERM INVESTMENTS IN SECURITIES DURING THE PERIOD/YEAR
As per the Balance Sheet 44,44,22,821 36,16,97,129 34,11,54,821
Add: Provisions on investments made during the period/year -- -- 15,28,98,608
Less: Non-cash investment on transfer of intellectual property rights
(refer to note 2 below) -- (8,93,40,000) (8,93,40,000)
------------- ------------- -------------
44,44,22,821 27,23,57,129 40,47,13,429
Less: Opening balance considered (34,11,54,821) (13,83,48,469) (13,83,48,469)
------------- ------------- -------------
10,32,68,000 13,40,08,660 26,63,64,960
============= ============= =============
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD/YEAR
As per the Balance Sheet 446,28,93,265 426,00,41,918 385,06,10,285
Add: Deposits with financial institutions and body corporate,
included herein 184,22,33,208 45,93,29,884 192,67,52,157
------------- ------------- -------------
630,51,26,473 471,93,71,802 577,73,62,442
============= ============= =============
</TABLE>
NOTES ON THE STATEMENT OF CASH FLOWS
1. Cash flows are reported using the indirect method, whereby profit after 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.
2. During the year ended March 31, 2001, the company transferred intellectual
property rights in OnScan - a web-based wireless enabled notification product,
to OnMobile Systems, Inc., USA (formerly OnScan, Inc.) - a company incubated by
Infosys. The product was transferred for a gross consideration of Rs.
8,93,40,000 (approximately US$ 2,000,000) that was received as equity preferred
convertible voting and non-voting stock in OnMobile Systems, Inc. Accordingly
the transaction is not considered in this statement of cash flows.
20
<PAGE> 21
Pro forma profit and loss account (un-audited)
--------------------------------------------------------------------------------
The company intends to reformat its Indian GAAP income statement following the
functional classification methodology. The company believes that this will
enable a more meaningful analysis and comparison of revenues, costs and margins
as well as facilitate a better understanding of its business by the financial
community. The pro forma un-audited profit and loss account prepared in
accordance with the proposed format along with the current reporting format is
provided in this section for the current quarter. Commencing next quarter, the
Company intends to report its income statement in the proposed format. The
change in the ratio analysis, in keeping with the proposed format of the profit
and loss account is also attached.
<TABLE>
<S> <C>
in Rs. in Rs.
------------------------------------------------------------ ----------------------------------------------------------
PROPOSED FORMAT CURRENT FORMAT
------------------------------------------------------------ ----------------------------------------------------------
Profit and loss account for the quarter ended June 30, 2001
INCOME INCOME
Software development services and products Software development services and products
Overseas 596,30,21,488 Overseas 596,30,21,488
Domestic 16,21,65,861 Domestic 16,21,65,861
Other income 13,49,39,605
------------------------------------------------------------ ----------------------------------------------------------
612,51,87,349 626,01,26,954
------------------------------------------------------------ ----------------------------------------------------------
SOFTWARE DEVELOPMENT EXPENSES 285,56,14,122
------------------------------------------------------------ ----------------------------------------------------------
GROSS PROFIT 326,95,73,227
SELLING, GENERAL AND ADMINISTRATION EXPENSES EXPENDITURE
Selling and marketing expenses 27,65,03,540 Software development expenses 318,32,88,293
General and administration expenses 58,79,35,341 Administration and other expenses 53,67,64,710
------------------------------------------------------------ ----------------------------------------------------------
86,44,38,881 372,00,53,003
OPERATING PROFIT 240,51,34,346 Operating profit (PBIDT) 254,00,73,951
Interest - Interest -
Depreciation 35,48,03,492 Depreciation 35,48,03,492
------------------------------------------------------------ ----------------------------------------------------------
Operating profit after depreciation
and interest 205,03,30,854
Other income 13,49,39,605
------------------------------------------------------------ ----------------------------------------------------------
PROFIT BEFORE TAX 218,52,70,459 Profit before tax 218,52,70,459
Provision for taxation 28,50,00,000 Provision for taxation 28,50,00,000
------------------------------------------------------------ ----------------------------------------------------------
NET PROFIT AFTER TAX 190,02,70,459 Net profit after tax 190,02,70,459
------------------------------------------------------------ ----------------------------------------------------------
AMOUNT AVAILABLE FOR APPROPRIATION 190,02,70,459 AMOUNT AVAILABLE FOR APPROPRIATION 190,02,70,459
------------------------------------------------------------ ----------------------------------------------------------
Dividend Dividend
Interim - Interim -
Final - Final -
Dividend tax - Dividend Tax -
Balance in Profit and Loss account 190,02,70,459 Balance in Profit and Loss account 190,02,70,459
------------------------------------------------------------ ----------------------------------------------------------
190,02,70,459 190,02,70,459
============================================================ ==========================================================
EARNINGS PER SHARE EARNINGS PER SHARE
(Equity shares, par value Rs.5 each) (Equity shares, par value Rs.5 each)
Basic 28.72 Basic 28.72
Diluted 28.59 Diluted 28.59
Number of shares used in computing earnings per share Number of shares used in computing earnings per share
Basic 6,61,59,038 Basic 6,61,59,038
Diluted 6,64,65,149 Diluted 6,64,65,149
------------------------------------------------------------ ----------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
Reconciliation of profit and loss account items
Software development expenses reported under current format 318,32,88,293
Less: Expenses reported under Selling and marketing, and general and administration
expenses under proposed format
Salaries and bonus including overseas staff expenses 26,71,70,368
Staff welfare 11,63,485
Contribution to provident and other funds 85,98,012
Foreign travel expenses 5,03,50,879
Other expenses 3,91,427
------------------------------------------------------------------------------------------------------------------------
32,76,74,171
Software development expenses reported under proposed format 285,56,14,122
------------------------------------------------------------------------------------------------------------------------
Administration expenses reported under current format
As reported under current format 53,67,64,710
Add: Expenses reported under software development expenses in current format 32,76,74,171
------------------------------------------------------------------------------------------------------------------------
Selling, general and administration expenses reported under proposed format 86,44,38,881
------------------------------------------------------------------------------------------------------------------------
</TABLE>
Note: Under the current reporting format, aggregate employee costs and other
costs are reported under software development expenses while under the proposed
format, employee costs and other costs are reported under the respective
functional heads namely software development expenses, selling and marketing,
and general and administration expenses.
<PAGE> 22
Pro forma ratio analysis
--------------------------------------------------------------------------------
This section provides certain key operating ratios both under the current format
and the proposed format.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
PROPOSED FORMAT CURRENT FORMAT
------------------------------------------------------------------------------------------------------------------------
<S> <C>
Ratios - Financial performance
Export revenue/ total revenue (%) 97.35 Export revenue/ total revenue (%) 95.25
Domestic revenue/ total revenue (%) 2.65 Domestic revenue/ total revenue (%) 2.59
Software development expenses/ total revenue (%) 46.62 Operating expenses/ total revenue (%) 59.42
Gross profit/ total revenue (%) 53.38
Selling and marketing expenses / total revenue (%) 4.51
General and administration expenses/ total revenue (%) 9.60 Administration expenses/ total revenue (%) 8.57
Employee costs/ total revenue (%) 42.47 Employee costs/ total revenue (%) 41.56
Operating profit / total revenue (%) 39.27 EBIDTA/ total revenue (%) 40.58
Depreciation/ total revenue (%) 5.79 Depreciation/ total revenue (%) 5.67
Other income/ total revenue (%) 2.20 Other income/ total revenue (%) 2.16
Profit before tax/ total revenue (%) 35.68 Profit before tax/ total revenue (%) 34.91
Tax/total revenue (%) 4.65 Tax/total revenue (%) 4.55
Tax/ PBT(%) 13.04 Tax/ PBT(%) 13.04
PAT from ordinary activities/ total revenue (%) 31.02 PAT from ordinary activities/ total revenue (%) 30.36
PAT from ordinary activities/ PAT from ordinary activities/
average net worth (%) (LTM) 54.15 average net worth (%) (LTM) 54.15
ROCE (PBIT/average capital employed) (%) (LTM) 61.00 ROCE (PBIT/average capital employed) (%) (LTM) 61.00
Ratios - year on year growth rates*
Export revenue (%) 70 Export revenue (%) 70
Total revenue (%) 72 Total revenue (%) 69
Software development expenses (%) 67 Operating expenses (%) 71
Gross profit (%) 77
Selling and marketing expenses (%) 54
General and administration expenses (%) 102
Operating profit (%) 75 Operating profit (%) 66
Net profit from ordinary activities (%) 57 Net profit from ordinary activities (%) 57
Ratios - sequential growth rates**
Export revenue (%) 8 Export revenue (%) 8
Total revenue (%) 9 Total revenue (%) 9
Software development expenses (%) 16 Operating expenses (%) 12
Gross profit (%) 3
Selling and marketing expenses (%) (8)
General and administration expenses (%) 10
Operating profit (%) 3 Operating profit (%) 5
Net profit from ordinary activities (%) 5 Net profit from ordinary activities (%) 5
------------------------------------------------------------------------------------------------------------------------
</TABLE>
LTM - Last Twelve Months
* Denotes growth compared with figures of the corresponding period in the
previous year.
** Denotes growth compared with figures of the immediate preceding quarter.
<PAGE> 23
At a glance - US GAAP
<TABLE>
<CAPTION>
US $ millions, except as otherwise stated
-----------------------------------------------------------------------------------------------------
Quarter ended June 30, Year ended
March 31,
2001 2000 2001
-------- --------- ----------
<S> <C> <C> <C>
For the period
Revenues 130.53 80.26 413.85
Operating income 42.44 26.41 137.51
Net income 39.24 26.83 131.95
Operating income as a percentage of total revenues 32.51% 32.90% 33.23%
Net income as a percentage of total revenues 30.06% 33.43% 31.88%
Basic earnings per share $0.60 $0.41 $2.01
Cash dividend per equity share NA NA $0.14
Capital investments 20.56 18.15 96.78
At the end of the period
Total assets 372.38 247.03 342.35
Property, plant and equipment - net 132.77 61.70 119.77
Cash and cash equivalents 134.18 105.76 124.08
Working capital 184.09 139.12 176.18
Total debt -- -- --
Stockholders' equity 337.91 216.67 311.79
Common stock 8.59 8.59 8.59
Market capitalization 5,086.31 12,315.06 5,783.15
-------- --------- --------
</TABLE>
Note:
Market capitalization is calculated by considering the Indian market price for
the shares outstanding at the period / year end.
<TABLE>
<CAPTION>
YEAR ENDED QUARTER ENDED QUARTER ENDED
MARCH 31, 2001 JUNE 30, 2000 JUNE 30, 2001
-------------- ------------- -------------
<S> <C> <C> <C>
REVENUES
(US $ IN MILLIONS) 413.85 80.26 130.53
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED QUARTER ENDED QUARTER ENDED
MARCH 31, 2001 JUNE 30, 2000 JUNE 30, 2001
-------------- ------------- -------------
<S> <C> <C> <C>
OPERATING INCOME
(US $ IN MILLIONS) 137.51 26.41 42.44
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED QUARTER ENDED QUARTER ENDED
MARCH 31, 2001 JUNE 30, 2000 JUNE 30, 2001
-------------- ------------- -------------
<S> <C> <C> <C>
NET INCOME
(US $ IN MILLIONS) 131.95 26.83 39.24
</TABLE>
23
<PAGE> 24
FORM 6K
(From Page 24 to 58)
<PAGE> 25
Shareholder information
--------------------------------------------------------------------------------
1. Listing on stock exchanges Bangalore Stock Exchange Ltd. (BgSE)
in India at Stock Exchange Towers, No. 51, 1st Cross,
J. C. Road, Bangalore - 560 027, India
Tel.: +91-80-299 5234, Fax: +91-80-299 5242
The Stock Exchange, Mumbai (BSE)
Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai
- 400 001, India.
Tel.: +91-22-265 5656 / 265 0525, Fax:
+91-22-272 2037
National Stock Exchange of India Ltd. (NSE)
Trade World, Senapati Bapat Marg, Lower Parel,
Mumbai - 400 013, India.
Tel.: +91-22-659 8235 / 36,
Fax: +91-22-659 8237 / 38
2. Listing fees Paid for all the above stock exchanges for 2001-
2002
3. Listing on stock NASDAQ National Market in the United States
exchanges outside India 33 Whitehall Street, New York, NY-1004-4087
Tel.: +1-212-709-2400, Fax: +1-212-709-2496
4. Registered office Electronics City, Hosur Road,
Bangalore - 561 229, India.
Tel.: +91-80-852 0261, Fax: +91-80-852 0362
Homepage: www.infy.com
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
Mumbai, National and Bangalore Stock Exchanges for the quarter ended June
30, 2001 are:
<TABLE>
<CAPTION>
BSE NSE 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>
April, 2001 4,226 2,721 73,13,583 4,228 2,701 1,05,60,270 4,250 2,730 10,912
May 4,334 3,601 68,63,941 4,328 3,607 1,06,32,274 4,300 3,680 5,221
June 3,969 3,135 74,11,429 3,995 3,138 1,26,84,001 3,950 3,160 4,697
-------------------------------------------------------------------------------------------------------------------------
Total 2,15,88,953 3,38,76,545 20,830
% of volume traded to average
shares outstanding 33.70%(*) 52.87%(*) 0.03%(*)
-------------------------------------------------------------------------------------------------------------------------
</TABLE>
(*)The number of shares outstanding is 6,40,70,000. The equity shares underlying
the American Depositary Shares (ADSs) have been excluded for the purpose of this
calculation.
<TABLE>
<S> <C>
6. Par value of equity shares Rs. 5 each fully paid-up
7. Share transfers in physical form Karvy Consultants Limited
and other communication regarding Registrars and Share Transfer Agents
share certificates, dividends, T. K. N. Complex, No. 51/2, Vanivilas Road,
change of address etc., in India Opp. National College, Basavanagudi,
may be addressed to Bangalore - 560 004, India.
Tel.: +91-80-662 1184/92/93, Fax: +91-80-662 1169
E-mail: ullur@karvy.com
</TABLE>
8. Share transfer system
Shares sent for physical transfer are generally registered and returned
within a period of 10 days from the date of receipt, if the documents are
clear in all respects. 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 June 30, 2001 was 9,800 (quarter ended June 30, 2000
- 6,636). 100.00% of transfers (quarter ended June 30, 2000 - 72.88%) were
completed within 10 days.
59
<PAGE> 26
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
Quarter ended June 30,
2001 2000
-------------------------------------------------------------------------------------------------------------------
Transfer No. of No. of No. of No. of
period transferees (folios) shares % transferees (folios) shares %
in days New Existing New Existing
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 - 10 13 -- 9,800 100.00 7 3 4,836 72.88
11- 15 -- -- -- -- 1 -- 400 6.02
16- 20 -- -- -- -- 3 -- 1,400 21.10
21 and above -- -- -- -- -- -- -- --
-------------------------------------------------------------------------------------------------------------------
13 -- 9,800 100.00 11 3 6,636 100.00
-------------------------------------------------------------------------------------------------------------------
</TABLE>
9. Investors' services - complaints received during
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------
Quarter ended June 30,
Nature of complaints 2001 2000
---------------------------------------------------------------------------------------------------------------
Received Attended to Received Attended to
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Non-receipt of share certificates 1 1 -- --
2. Non-receipt of bonus shares/split shares 1 1 1 1
3. Letters from Stock Exchanges, SEBI, etc. 2 2 -- --
4. Non-receipt of dividend 22 22 10 10
---------------------------------------------------------------------------------------------------------------
26 26 11 11
---------------------------------------------------------------------------------------------------------------
</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 June 30, 2001 except in cases that are constrained by disputes or
legal impediments.
10. 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.
11. Distribution of shareholding as on June 30
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
2001 2000
--------------------------------------------------------------------------------------------------------------------------------
No. of equity No. of % of No. of % of No. of % of No. of % of
shares held share- share- shares share- share- share- shares share-
holders holders holding holders holders holding
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 - 100 82,025 88.01 10,18,502 1.59 52,308 81.51 7,45,648 1.16
101 - 200 2,620 2.81 4,18,175 0.65 2,532 3.94 4,31,292 0.67
201 - 500 2,925 3.14 10,05,697 1.57 2,996 4.67 10,70,430 1.67
501 - 1000 2,353 2.52 17,20,005 2.69 2,718 4.23 20,25,170 3.16
1001 - 5000 2,578 2.77 52,93,875 8.26 2,930 4.57 61,57,016 9.61
5001 - 10000 278 0.30 20,02,763 3.13 305 0.48 21,95,063 3.43
10001 and above 417 0.45 5,26,10,983 82.11 384 0.60 5,07,28,433 79.18
Shares in transit in NSDL -- -- -- -- -- -- 7,15,748 1.12
--------------------------------------------------------------------------------------------------------------------------------
93,196 100.00 6,40,70,000 100.00 64,173 100.00 6,40,68,800 100.00
Equity shares underlying 1 20,90,717 1 20,82,567
American Depositary Shares*
--------------------------------------------------------------------------------------------------------------------------------
Total 93,197 6,61,60,717 64,174 6,61,51,367
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Held by beneficial owners outside India.
60
<PAGE> 27
12. Categories of shareholders as on June 30
<TABLE>
<CAPTION>
----------------------------------------------------------------------------- --------------------------------------------
2001 2000
----------------------------------------------------------------------------- --------------------------------------------
Category No. of Voting No. of shares No. of Voting No. of shares
shareholders strength(%) held shareholders strength(%) held
----------------------------------------------------------------------------- --------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Individuals 88,652 21.84 1,44,47,652 60,592 25.50 1,68,66,371
Companies 3,221 1.17 7,74,645 2,653 1.84 12,18,249
FIIs 383 32.78 2,16,90,844 316 25.26 1,67,13,447
OCBs and NRIs 721 0.68 4,48,119 426 0.73 4,82,811
Founders and their families 23 28.98 1,91,75,110 23 29.30 1,93,80,560
Mutual Funds, Banks, FIs 196 11.39 75,33,630 163 13.14 86,91,614
Shares in transit in NSDL -- -- -- -- 1.08 7,15,748
Equity shares underlying 1 3.16 20,90,717 1 3.15 20,82,567
American Depositary Shares*
----------------------------------------------------------------------------- --------------------------------------------
Total 93,197 100.00 6,61,60,717 64,174 100.00 6,61,51,367
----------------------------------------------------------------------------- --------------------------------------------
</TABLE>
* Held by beneficial owners outside India.
13. Financial calendar (tentative and subject to change)
<TABLE>
<S> <C>
Financial reporting for the second quarter ending September 30, 2001 October 10, 2001
Interim dividend payment (if any) November 12, 2001
Financial reporting for the third quarter ending December 31, 2001 January 10, 2002
Financial results for the year ending March 31, 2002 April 10, 2002
Annual General Meeting for the year ending March 31, 2002 June 2002
</TABLE>
<TABLE>
<S> <C>
14. Investors' correspondence in India Any queries relating to the financial statements
may be addressed to: of the company may be addressed to:
The Company Secretary, Mr. T. V. Mohandas Pai,
Investors' Service Cell, Director (F&A) and CFO,
Infosys Technologies Ltd., Electronics City, Infosys Technologies Ltd., Electronics City,
Hosur Road, Bangalore - 561 229, India. Hosur Road, Bangalore - 561 229, India.
Tel.: +91-80-852 1518, Fax: +91-80-852 0362 Tel.: +91-80-852 0396, Fax: +91-80-852 0362
E-mail: balakv@infy.com E-mail: mdpai@infy.com
</TABLE>
<TABLE>
<S> <C> <C>
15. Reuters code
- INFY.BO (BSE) Bridge code - IN;INF (BSE) Bloomberg code - INFO IN (BSE)
- INFY.NS (NSE) - IN;INFN (NSE) - NINFO IN (NSE)
- INFY.O (NASDAQ) - US;INFY (NASDAQ)
</TABLE>
16. 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
June 30, 2001 are:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------
High Low Volume
----------------------------------------------------------------------------------------------
$ Rs. $ Rs. Nos.
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
April, 2001 73.95 3,464 50.65 2,372 50,97,100
May 81.50 3,826 64.35 3,021 22,49,900
June 74.60 3,505 55.69 2,617 14,19,300
----------------------------------------------------------------------------------------------
Total 87,66,300
----------------------------------------------------------------------------------------------
% of volume traded to total float 209.65%*
</TABLE>
* 2 ADS = 1 equity share
$ have been converted into Indian rupees at the monthly closing rates
61
<PAGE> 28
e. Premium of American Depositary Shares over the shares traded on the Indian
stock exchanges The ADS price quoted below is in Indian rupees and has been
converted at the monthly closing rates.
ADS PREMIUM
<TABLE>
<CAPTION>
06/04 12/04 20/04 27/04 04/05 11/05 18/05 25/05 01/06 08/06 15/06 22/06 29/06
----- ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ADS PRICE* 5,640 5,293 5,902 6,209 6,810 6,596 6,994 6,783 6,306 6,931 6,167 5,911 6,109
NSE SHARE PRICE 4,029 2,861 3,819 3,248 3,822 3,888 3,949 4,175 3,756 3,943 3,405 3,432 3,749
% PREMIUM 39.99 85.01 54.54 91.16 78.18 69.65 77.11 62.47 67.89 75.78 81.12 72.23 62.95
</TABLE>
* 2 ADS = 1 equity share
f. 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@infy.com
g. Name and address of the Deutsche Bank A.G.
depositary bank Corporate Trust and Agency Services
4 Albany Street
New York, NY 10006, USA.
Tel.: +1-212-250-8500,
Fax: +1-212-250-5644.
Corporate Trust and Agency Services
Deutsche Bank A.G.
1st Floor, Kodak House,
222, Dr. D. N. Road, Fort,
Mumbai - 400 001, India.
Tel.: +91-22-207 3262, Fax: +91-22-207 9614
h. Name and address of the ICICI Limited
custodian in India ICICI Towers, Bandra Kurla Complex
Mumbai - 400 051, India.
Tel.: +91-22-653 1414,
Fax: +91-22-653 1164/65.
62
<PAGE> 29
Ratio analysis as per Indian GAAP
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Quarter ended Year ended
June 30, 2001 June 30, 2000 March 31, 2001
------------- ------------- --------------
<S> <C> <C> <C>
Ratios - Financial performance
Export revenue / total revenue(%) 95.25 94.72 95.62
Domestic revenue / total revenue(%) 2.59 1.21 1.35
Other income / total revenue(%) 2.16 4.08 3.03
Employee costs / total revenue(%) 41.56 38.47 36.62
Administration expenses / total revenue(%) 8.57 7.69 9.06
Operating expenses / total revenue(%) 59.42 58.79 58.73
Depreciation / total revenue(%) 5.67 4.79 5.76
Tax / total revenue(%) 4.55 3.70 3.71
Tax / PBT(%) 13.04 10.15 10.45
EBIDTA / total revenue(%) 40.58 41.21 41.27
PAT from ordinary activities / total revenue(%) 30.36 32.73 31.80
PAT from ordinary activities / average net worth(%)(LTM) 54.15 43.51 56.08
ROCE (PBIT/Average capital employed)(%)(LTM) 61.00 49.22 62.62
Return on invested capital(%)(LTM) 91.69 97.28 105.67
Capital output ratio(LTM) 1.69 1.34 1.71
Invested capital output ratio(LTM) 2.97 3.16 3.34
Ratios - Balance sheet
Debt-Equity ratio -- -- --
Debtors turnover(Days)* 46 59 58
Current Ratio 3.91 4.21 3.49
Cash and cash equivalents / total assets(%) 39.52 49.15 41.57
Cash and cash equivalents / total revenue(%)(LTM) 28.46 42.59 29.48
Depreciation / average gross block(%)(LTM) 23.49 21.86 24.67
Technology investment / total revenue(%)(LTM) 6.98 6.44 7.43
Ratios - Growth**
Export revenue(%) 70 108 115
Total revenue(%) 69 101 113
Operating expenses(%) 71 105 112
Operating profit(%) 66 96 114
Net profit from ordinary activities(%) 57 100 118
Per-share data (Period End)
Basic earnings per share from ordinary activities(Rs.) 28.72 18.34 94.23
Basic earnings per share (including extraordinary items)(Rs.) 28.72 19.17 95.06
Cash earnings per share from ordinary activities(Rs.) 34.08 21.02 111.29
Cash earnings per share (including extraordinary items)(Rs.) 34.08 21.85 112.12
Book value(Rs.) 241.17 145.15 210.05
Price / earning(LTM) 34.54 158.60 43.19
Price / cash earnings(LTM) 29.05 134.65 36.57
Price / book value 14.98 57.25 19.38
EPS growth(%) 56.60 100.22 117.97
PE / EPS growth 0.61 1.58 0.37
Dividend per share(Rs.) -- -- 10.00
</TABLE>
LTM - Last twelve months
* Annualized.
** Denotes growth compared with figures of the corresponding period in the
previous year.
63
<PAGE> 30
Infosys Technologies Limited
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
United States UK Hong Kong
16F Cheung Kong Centre
Addison Croydon 2 Queen's Road Central
15305 Dallas Parkway P.O. Box 1221 Central, Hong Kong
Suite 210 11th Floor Emerald House Tel.: 852 22972806
Addison, TX 75001 7/15 Lansdowne Road Fax: 852 22970066
Tel.: (972) 770-0450 Croydon, CR0 2BX
Fax: (972) 770-0490 Tel.: 44-20-8774 3300
Fax: 44-20-8686 6631 Japan
Bellevue
10900 NE 4th St. Argentina Tokyo
#2300 Bellevue 2F, Kearny Place Akasaka,
WA 98004 Buenos Aires 2-21-25, Akasaka,
Tel.: (425) 990 1028 Grupo ASSA Building Minato-Ku, Tokyo 107-0052
Fax: (425) 990 1029 2nd Floor, Elvira Rawson de Tel.: 81 3-5545-3251
Dellepiane 150, Dique 1 Fax: 81 3-5545-3252
Fremont Puerto Madero, C1107BCA
34760 Campus Drive Buenos Aires Singapore
Fremont 30, Raffles Place,
CA 94555 Australia 23-00, Caltex House
Tel.: (510) 742 3000 Singapore 048622
Fax: (510) 742 3090 Melbourne Tel.: 65 233 6820
Level 7, 505, St Kilda Road Fax: 65 233 6905
Marietta Melbourne, Victoria 3004
1950 Spectrum Circle Tel.: 61 3 9868 1607 Sweden
#400 Marietta Fax: 61 3 9868 1652
GA 30067 Stockholm
Tel.: (770) 857 4428 Sydney Stureplan 4C, 4tr
Fax: (770) 857 2258 Level 4, 90, Mount Street 114 35, Stockholm
North Sydney, NSW 2060 Tel.: 46-846 31112
Newport Beach Tel.: 61 2 9954 0036 Fax: 46-846 31114
4590 MacArthur Fax: 61 2 8904 1344
Suite 500 UAE
Newport Beach Belgium P. O. Box 8230
CA 92660 Sharjah Airport Intl.
Tel.: (949) 475 0196 Brussels Free Zone Sharjah
Fax: (949) 475 0198 Dreve Richelle 161 Tel.: 971 6557 0000
Building N 1410 Waterloo Fax: 971 6557 1010
Quincy Brussels
Two Adams Place Tel.: 322-352-8743
Quincy, MA 02169 Fax: 322-352-8889
Tel.: (781) 356 3100
Fax: (781) 356 3150 Canada
Troy Toronto
100 Liberty Center 5140 Yonge Street
#200 West Big Beaver Suite 1400, Toronto
Troy, MI 48084 Ontario, M2N 6L7
Tel.: (248) 524 0320 Tel.: (416) 224 7400
Fax: (248) 524 0321 Fax: (416) 224 7449
Phoenix France
10851, N Black Canyon
Highway, #830 Paris
Phoenix, AZ 85029 12, AV DU Centre
Tel.: (602) 944 4855 Faubourg de l'Arche 92419
Fax: (602) 944 4879 Courbevoie Cedex
Tel.: 33 1 4691 8454
Lisle Fax: 33 1 4691 8800
2300 Cabot Dr
Suite 250 Germany
Lisle, IL 60532
Tel.: (630) 482 5000 Frankfurt
Fax: (630) 505 9144 TOPAS 2, Mergenthalerallee
79-81, 65760, Eschborn
Berkeley Heights Frankfurt
Two Oak Way Tel.: 49 6196 9202115
Fourth Floor, South Wing Fax: 49 6196 9202320
Berkeley Heights,
NJ 07922
Tel.: (908) 286 3101
Fax: (908) 286 3125
</TABLE>
<TABLE>
<S> <C> <C>
India Konark Mohali (Chandigarh)
Plot No. E/4 B 100, Phase VIII
Bangalore Infocity, Chandaka Industrial Area, SAS Nagar
Electronics City Bhubaneswar-751 014 Mohali-160 059
Hosur Road Tel.: (0674) 320001 Tel.: (0172) 254191/92/94
Bangalore-561 229 Fax: (0674) 320100 Fax: (0172) 254193
Tel.: (080) 8520261
Fax: (080) 8520362 Chennai Mumbai
No. 138, No. 85, Mittal Towers 'C'
Reddy Building Old Mahabalipuram Road 8th Floor, Nariman Point
K-310, 1st Main Sholinganallur Mumbai-400 021
5th Block, Koramangala Chennai-600 119 Tel.: (022) 2882911-14
Bangalore-560 095 Tel.: (044) 4500345 Fax: (022) 2846489
Tel.: (080) 5530392
Fax: (080) 5530391 Hyderabad 1Q3 A1, 1st Floor, Mysore
Cyber Towers SJCE-STEP
Pavithra Complex HI-TEC City, Madhapur Sree Jayachamarajendra
#1, 27th Main, 2nd Cross Hyderabad-500 033 College of Engineering,
1st Stage, BTM Layout Tel.: (040) 3100242/44-48 Science and Technology
Bangalore-560 068 Fax: (040) 3100243 Entrepreneurs Park
Tel.: (080) 6681755 Mysore-570 006
Fax: (080) 6680181 Kolkata Tel.: (0821) 500001/06/08
C/61, Bapuji Nagar Fax: (0821) 511614
Infosys Towers Regent Estate P.O.
No. 27, Bannerghatta Road Kolkata-92 New Delhi
3rd Phase, J. P. Nagar Pager No. 9628-304450 K30, Green Park Main
Bangalore-560 076 Behind Green Park Market
Tel.: (080) 6588668 Mangalore New Delhi-110 066
Fax: (080) 6588676 Kottara Cross Tel.: (011) 6514829-30
Kuloor Ferry Road Fax: (011) 6853366
Bhubaneswar Mangalore-575 006
Plot No. N-1/70, Nayapalli Tel.: (0824) 451485-88 Pune
Adjoining Planetarium on Fax: (0824) 451504 Plot No. 1
NH5, Post RRL Infotech Park MIDC
Bhubaneswar-751 013 Hinjewadi, Taluka Mulshi
Tel.: (0674) 584068-71 Pune-411 027
Fax: (0674) 583991 Tel.: (02139) 32801-03
Fax: (02139) 32832
</TABLE>
6
</TEXT>
</DOCUMENT>