EX-99.3 4 f58049exv99w3.htm EX-99.3 exv99w3
Exhibit 99.3
Wipro Limited
CONSOLIDATED AUDITED FINANCIAL RESULTS FOR THE QUARTER & NINE MONTHS ENDED DECEMBER 31, 2010
((RUPEE SYMBOL). in Million, except share and per share data, unless otherwise stated)
                                             
        Quarter ended   Nine months ended   Year ended
        December 31,   December 31,   March 31,
    Particulars   2010   2009   2010   2009   2010
1  
Net Income from Sales/Services
     78,293       69,774       227,963       201,413       271,241  
2  
Cost of Sales / Services
                                        
   
a) (Increase)/Decrease in stock in trade and work in progress
     (192 )     (825 )     221       72       (323 )
   
b) Consumption of raw materials
     3,496       2,350       10,237       8,615       13,070  
   
c) Purchase of traded goods
     8,480       9,621       25,245       25,327       37,484  
   
d) Other expenditure
     39,883       34,851       114,446       99,272       129,152  
3  
Gross Profit (1-2)
     26,626       23,777       77,814       68,127       91,858  
4  
General and Administrative expenses
     4,861       3,612       12,838       10,946       14,481  
5  
Selling and Distribution expenses
     5,330       4,644       16,165       13,088       18,036  
6  
Depreciation and amortization
     2,078       1,985       5,930       5,944       7,831  
7  
Operating Profit before interest (3) - (4+5+6)
     14,357       13,536       42,881       38,149       51,510  
8  
Interest expense
     427       203       1,297       1,334       990  
9  
Exceptional Items
     —       —       —       —       —  
10  
Operating Profit after interest and Exceptional Items (7-8-9)
     13,930       13,333       41,584       36,815       50,520  
11  
Other investment income
     1,751       924       4,525       3,091       4,360  
12  
Profit from Ordinary Activities before tax (10+11)
     15,681       14,257       46,109       39,906       54,880  
13  
Tax Expense (including Fringe Benefits Tax)
     2,582       2,322       7,110       6,279       9,294  
14  
Net Profit from Ordinary Activities after tax (12-13)
     13,099       11,935       39,000       33,627       45,586  
15  
Minority Interest
     (71 )     (31 )     (286 )     (139 )     (185 )
16  
Share in Earnings of Associates
     160       128       509       354       530  
17  
Extraordinary items (net of tax expense)
     —       —       —       —       —  
18  
Net Profit for the period (14+15+16-17)
     13,188       12,032       39,222       33,842       45,931  
19  
Paid up equity share capital
(Face value Rs. 2 per share)
     4,907       2,935       4,907       2,935       2,936  
20  
Reserves excluding Revaluation Reserves
     224,242       177,434       224,242       177,434       193,355  
21  
EARNINGS PER SHARE (EPS)
                                        
   
After extraordinary items (not annualised)
Basic (in (RUPEE SYMBOL).)
     5.41       4.95       13.94       16.10       18.91  
   
Diluted (in (RUPEE SYMBOL).)
     5.39       4.91       13.82       16.03       18.75  
   
After extraordinary items (not annualised)
                                        
   
Basic (in (RUPEE SYMBOL).)
     5.41       4.95       13.94       16.10       18.91  
   
Diluted (in (RUPEE SYMBOL).)
     5.39       4.91       13.82       16.03       18.75  
22  
Public shareholding *
                                        
   
Number of shares
     466,455,228       275,058,920       466,455,228       275,058,920       276,454,859  
   
Percentage of holding
     19.01 %     18.74 %     19.01 %     18.74 %     18.83 %
23  
Promoters and promoter group shareholding
                                        
   
a) Pledged/Encumbered
                                        
   
— Number of shares
   Nil     Nil     Nil     Nil     Nil  
   
— Percentage of shares (as a % of the total shareholding of promoter and promoter group)
   Nil     Nil     Nil     Nil     Nil  
   
— Percentage of shares (as a % of the total share capital of the company)
   Nil     Nil     Nil     Nil     Nil  
   
b) Non-encumbered
                                        
   
— Number of shares
     1,945,953,763 **     1,168,382,260 **     1,945,953,763 **     1,168,382,260 **     1,167,572,260 **
   
— Percentage of shares (as a % of the total shareholding of promoter and promoter group)
     100 %     100 %     100 %     100 %     100 %
   
— Percentage of shares (as a % of the total share capital of the company)
     79.31 %     79.61 %     79.31 %     79.61 %     79.52 %
   
Details of expenditure
                                        
   
Items exceeding 10% of total expenditure
                                        
   
Employee Cost
     31,788       25,828       93,037       79,318       107,230  
 
*   Public shareholding as defined under clause 40A of the listing agreement (excludes shares beneficially held by promoters and holders of American Depository Receipt).
 
**   Includes 10,843,333 (December 31, 2009: 7,316,000 and March 31, 2010: 6,506,000) equity shares on which Promoter does not have beneficiary interest.
Status of redressal of Complaints received for the period October 1, 2010 to December 31, 2010
                                         
            Opening   Complaints   Complaints    
Sl.           balance   received during   disposed during    
No.   Nature of the complaint   Nature   01.10.2010   the quarter   the quarter   Unresolved
1  
Non Receipt of Securities
   Complaint     —       18       18       —  
2  
Non Receipt of Annual Reports
   Complaint     —       24       24       —  
3  
Correction / Duplicate/ Revalidation of dividend warrants
   Request     —       50       50       —  
4  
SEBI/Stock Exchange Complaints
   Complaint     —       5       5       —  
5  
Non Receipt of Dividend warrants
   Complaint     —       101       101       —  
   
 
                                    
   
TOTAL
         —       198       198       —  
   
 
                                    
Note: There are certain pending cases relating to disputes over title to shares in which the company has been made a party.
However these cases are not material in nature.
1.   The audited consolidated financial results were approved by Directors of the Company at its meeting held on January 21, 2011.
 
2.   The above interim financial results have been prepared from the condensed consolidated interim financial statements, which are prepared in accordance with International Financial Reporting Standards and its interpretations (“IFRS”), as issued by the International Accounting Standards Board (“IASB”).
 
3.   The consolidated interim financial statements have been prepared on a historical cost convention and on an accrual basis, except for the following material items that have been measured at fair value as required by relevant IFRS:-
  a.   Derivative financial instruments;
 
  b.   Available-for-sale financial assets; and
 
  c.   Share based payment transactions.
4.   The condensed consolidated interim financial statements incorporate the financial statements of the Parent Company and entities controlled by the Parent Company (its subsidiaries). Control is achieved where a company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that currently are exercisable are taken into account.
 
    All intra-company balances, transactions, income and expenses including unrealized income or expenses are eliminated in full on consolidation.
 
5.   The total revenues represent the aggregate revenue and includes foreign exchange gains / (losses), net.
 
6.   Derivatives
 
    The Company is exposed to foreign currency fluctuations on foreign currency assets / liabilities, forecasted cash flows denominated in foreign currency and net investments in foreign operations. The Company follows established risk management policies, including the use of derivatives to hedge foreign currency assets / liabilities, foreign currency forecasted cash flows and net investments in foreign operations. The counter party in these derivative instruments is a bank and the Company considers the risks of non-performance by the counterparty as non-material.
The following table presents the aggregate contracted principal amounts of the Company’s derivative contracts outstanding:
(in Million)
                         
    As at
    March 31, 2010   December 31, 2010
Designated derivative instruments                    
Sell
   $      1,518     $      1,124  
 
   £      31     £      22  
 
   ¥      4,578     ¥      3,414  
 
   AUD     7     AUD     6  
 
   CHF     —     CHF     3  
Net investment hedges in foreign operations            
Cross-currency swaps
   ¥      26,014     ¥      24,511  
Others
   $      262     $      272  
 
   €      40     €      40  
Non designated derivative instruments                    
Sell
   $      45     $      225  
 
   £      38     £      64  
 
   €      29     €      59  
Buy
   $      492     $      441  
Cross currency swaps
   ¥      7,000     ¥      7,000  
7.   The list of subsidiaries is included in the condensed consolidated financial statements of Wipro Limited and subsidiaries for the quarter and nine months ended December 31, 2010, which are available on our company website www.wipro.com.
 
8.   Standalone information (Audited)
                                         
    Quarter ended December 31,   Nine months ended December 31,   Year ended
Particulars   2010   2009   2010   2009   March 31, 2010
Revenues
     66,234       58,929       191,623       170,386       231,776  
Profit before tax
     14,549       14,353       41,250       41,793       56,887  
Profit after tax
     12,237       12312       35,060       36,612       48,979  
9.   Segment Information
 
    The Company is currently organized by segments, which includes IT Services (comprising of IT Services and BPO Services), IT Products, Consumer Care and Lighting and ‘Others’.
 
    The Chairman of the Company has been identified as the Chief Operating Decision Maker (CODM) as defined by IFRS 8, Operating Segments. The Chairman of the Company evaluates the segments based on their revenue growth, operating income and return on capital employed. The management believes that return on capital employed is considered appropriate for evaluating the performance of its operating segments. Return on capital employed is calculated as operating income divided by the average of the capital employed at the beginning and at the end of the period. Capital employed includes total assets of the respective segments less all liabilities, excluding loans and borrowings.
Information on reportable segments is as follows:
Three months ended December 31, 2009
                                                         
                            Consumer                
    IT Services and Products   Care and           Reconciling    
Particulars   IT Services   IT Products   Total   Lighting   Others   Items   Entity Total
Revenues
     51,648       10,114       61,762       5,743       1,896       373       69,774  
Cost of revenues
     (33,610 )     (8,956 )     (42,566 )     (3,048 )     (1,921 )     (231 )     (47,766 )
Selling and marketing expenses
     (2,628 )     (324 )     (2,952 )     (1,630 )     (85 )     (104 )     (4,770 )
General and administrative expenses
     (3,160 )     (232 )     (3,392 )     (317 )     (38 )     45       (3,702 )
 
                                                        
Operating income of segment
     12,250       602       12,852       748       (148 )     83       13,536  
 
                                                        
Finance expense
                                                     (203 )
Finance and other income
                                                     924  
Share of profits of equity accounted investees
                                                     128  
 
                                                        
Profit before tax
                                                     14,385  
Income tax expense
                                                     (2,322 )
 
                                                        
Profit for the period
                                                     12,063  
 
                                                        
Depreciation and amortization expense
                     1,729       93       86       75       1,983  
Average capital employed
                     112,365       18,823       5,562       86,927       223,677  
Return on capital employed
                     46 %     16 %     (11 )%     —       24 %
Three months ended December 31, 2010
                                                         
                            Consumer                
    IT Services and Products   Care and           Reconciling    
Particulars   IT Services   IT Products   Total   lighting   Others   Items   Entity Total
Revenues
     59,486       8,792       68,278       6,950       2,808       257       78,293  
Cost of revenues
     (38,951 )     (7,736 )     (46,687 )     (3,955 )     (2,604 )     (284 )     (53,530 )
Selling and marketing expenses
     (3,097 )     (340 )     (3,437 )     (1,848 )     (134 )     (68 )     (5,485 )
General and administrative expenses
     (4,227 )     (308 )     (4,535 )     (292 )     (87 )     (7 )     (4,921 )
 
                                                        
Operating income of segment
     13,211       408       13,619       855       (17 )     (102 )     14357  
 
                                                        
Finance expense
                                                     (427 )
Finance and other income
                                                     1,751  
Share of profits of equity accounted investees
                                                     160  
 
                                                        
Profit before tax
                                                     15,841  
Income tax expense
                                                     (2,582 )
 
                                                        
Profit for the period
                                                     13,259  
 
                                                        
Depreciation and amortization expense
                     1,709       105       89       90       2,078  
Average capital employed
                     141,276       21,464       6,875       110,286       279,901  
Return on capital employed
                     39 %     16 %     (1 )%     —       21 %
Nine months ended December 31, 2009
                                                         
                            Consumer                
    IT Services and Products   Care and           Reconciling    
Particulars   IT Services   IT Products   Total   Lighting   Others   Items   Entity Total
Revenues
     149,894       29,305       179,199       16,500       4,858       856       201,413  
Cost of revenues
     (98,316 )     (26,035 )     (124,351 )     (8,508 )     (5,111 )     (564 )     (138,534 )
Selling and marketing expenses
     (7,270 )     (1,017 )     (8,287 )     (4,741 )     (217 )     (255 )     (13,500 )
General and administrative expenses
     (9,408 )     (749 )     (10,157 )     (979 )     (149 )     55       (11,230 )
 
                                                        
Operating income of segment
     34,900       1,504       36,404       2,272       (619 )     92       38,149  
 
                                                        
Finance expense
                                                     (1,334 )
Finance and other income
                                                     3,091  
Share of profits of equity accounted investees
                                                     354  
Profit before tax
                                                     40,260  
Income tax expense
                                                     (6,279 )
Profit for the period
                                                     33,981  
Depreciation and amortization expense
                     5,187       320       214       223       5,944  
Average capital employed
                     114,890       19,300       5,701       80,616       220,507  
Return on capital employed
                     42 %     16 %     (14 )%     —       23 %

 

                                                         
Nine months ended December 31, 2010
                            Consumer                
    IT Services and Products   Care and           Reconciling   Entity
Particulars   IT Services   IT Products   Total   Lighting   Others   Items   Total
Revenues
     171,959       27,805       199,764       20,014       7,377       808       227,963  
Cost of revenues
     (111,773 )     (24,724 )     (136,497 )     (10,909 )     (7,017 )     (982 )     (155,405 )
Selling and marketing expenses
     (9,455 )     (980 )     (10,435 )     (5,658 )     (355 )     (174 )     (16,622 )
General and administrative expenses
     (11,202 )     (824 )     (12,026 )     (867 )     (227 )     65       (13,055 )
 
                                                        
Operating income of segment
     39,529       1,277       40,806       2,580       (222 )     (283 )     42,881  
 
                                                        
Finance expense
                                                     (1,297 )
Finance and other income
                                                     4,525  
Share of profits of equity accounted investees
                                                     509  
 
                                                        
Profit before tax
                                                     46,618  
Income tax expense
                                                     (7,110 )
 
                                                        
Profit for the period
                                                     39,508  
 
                                                        
Depreciation and amortization expense
                     5,101       320       240       269       5,930  
Average capital employed
                     140,618       20,899       7,072       105,352       273,941  
Return on capital employed
                     39 %     16 %     (4 )%     —       21 %
The Company has four geographic segments: India, the United States, Europe and Rest of the world. Revenues from the geographic segments based on domicile of the customer are as follows:
                                 
    Three months ended     Nine months ended  
    December 31,     December 31,  
    2009     2010     2009     2010  
India
   (RUPEE SYMBOL).  15,661     (RUPEE SYMBOL).  16,737     (RUPEE SYMBOL).  45,528     (RUPEE SYMBOL).  48,778  
United States
     29,879       32,462       89,190       94,775  
Europe
     14,543       18,851       41,578       49,080  
Rest of the world
     9,691       10,243       25,117       35,330  
 
                        
 
   (RUPEE SYMBOL).  69,774     (RUPEE SYMBOL).  78,293     (RUPEE SYMBOL).  201,413     (RUPEE SYMBOL).  227,963  
 
                        
No client individually accounted for more than 10% of the revenues during the three months and nine months ended December 31, 2009 and 2010.
Notes:
a)   The company has the following reportable segments:
  i)   IT Services: The IT Services segment provides IT and IT enabled services to customers. Key service offering includes software application development, application maintenance, research and development services for hardware and software design, data center outsourcing services and business process outsourcing services.
 
  ii)   IT Products: The IT Products segment sells a range of Wipro personal desktop computers, Wipro servers and Wipro notebooks. The Company is also a value added reseller of desktops, servers, notebooks, storage products, networking solutions and packaged software for leading international brands. In certain total outsourcing contracts of the IT Services segment, the Company delivers hardware, software products and other related deliverables. Revenue relating to these items is reported as revenue from the sale of IT Products.
 
  iii)   Consumer Care and Lighting: The Consumer Care and Lighting segment manufactures, distributes and sells personal care products, baby care products, lighting products and hydrogenated cooking oils in the Indian and Asian markets.
 
  iv)   The Others’ segment consists of business segments that do not meet the requirements individually for a reportable segment as defined in IFRS 8.
 
  v)   Corporate activities such as treasury, legal and accounting, which do not qualify as operating segments under IFRS 8, and elimination of inter-segment transactions have been considered as ‘reconciling items’.
b)   Revenues include excise duty of (RUPEE SYMBOL).220 and (RUPEE SYMBOL).264 for the three months ended December 31, 2009 and 2010, respectively and (RUPEE SYMBOL).604 and (RUPEE SYMBOL).747 for the nine months ended December 31, 2009 and 2010, respectively. For the purpose of segment reporting, the segment revenues are net of excise duty. Excise duty is reported in reconciling items.
 
c)   For evaluating performance of the individual business segments, stock compensation expense is allocated on the basis of straight line amortization. The incremental impact of accelerated amortization of stock compensation expense over stock compensation expense allocated to the individual business segments is reported in reconciling items.
 
d)   For evaluating the performance of the individual business segments, amortization of intangibles acquired through business combinations are reported in reconciling items. Accordingly, comparative period information has been reclassified.
 
e)   The Company generally offers multi-year payment terms in certain total outsourcing contracts. These payment terms primarily relate to IT hardware, software and certain transformation services in outsourcing contracts. Corporate treasury provides internal financing to the business units offering multi-year payments terms. Accordingly, such receivables are reflected in capital employed in reconciling items. As of December 31, 2009 and 2010, capital employed in reconciling items includes (RUPEE SYMBOL).7,249 and (RUPEE SYMBOL).11,597 respectively, of such receivables on extended collection terms.
 
f)   Operating income of segments is after recognition of stock compensation expense arising from the grant of options:
                                 
    Three months ended     Nine months ended  
    December 31,     December 31,  
Segments   2009     2010     2009     2010  
IT Services
   (RUPEE SYMBOL).  250     (RUPEE SYMBOL).  339     (RUPEE SYMBOL).  902     (RUPEE SYMBOL).  878  
IT Products
     20       24       73       67  
Consumer Care and Lighting
     19       29       51       85  
Others
     4       10       14       23  
Reconciling items
     32       (90 )     (79 )     (293 )
 
                        
Total
   (RUPEE SYMBOL).  325     (RUPEE SYMBOL).  312     (RUPEE SYMBOL).  961     (RUPEE SYMBOL).  760  
 
                        
    Management believes that it is currently not practicable to provide disclosure of geographical location wise assets, since the meaningful segregation of the available information is onerous.
 
10.   The Company has granted Nil options under RSU Options Plan during the three months ended December 31, 2009 and 2010, respectively and 5,000 and 6,661,180 options under RSU Options Plan during the nine months ended December 31, 2009 and 2010, respectively.
 
11.   Dividend
 
    On January 21, 2011, the Board of Directors of the Company declared an interim dividend of (RUPEE SYMBOL).2 ($0.04) per equity share and ADR (100% on an equity share of par value of (RUPEE SYMBOL).2).
RK SWAMY/BBDO 2271       (WIPRO LOGO)
Place: Bangalore
Date: January 21, 2011 		  By Order of the Board,
for Wipro Ltd.
Azim H Premji
Chairman 		  WIPRO LIMITED
Regd. Office: Doddakannelli,
Sarjapur Road, Bangalore — 560 035.
www.wipro.com