Cognizant lines up $400 mn capex for 2013

Q4 attrition was 10.7% lower than Q3 attrition of 13%

The IT major Cognizant has said that its capital expenditure for 2013 would be around $400 million. The capex plans on the backdrop of company's 17% growth in revenue in 2013. Meanwhile, the company has said that its fourth quarter attrition was lower in fourth quarter at 10.7% as compared to 13% in third quarter.

R Chandrasekaran, Group Chief Executive, Technology and Operations, Cognizant said a bulk of it will be used for infrastructure development to support our business growth.

“Our India real estate development program includes planned construction of an additional 10.5 million sq. ft. of new space between 2011 and the end of 2015. The expanded program includes the expenditure of over $700 million during this period on land acquisition, facilities construction, and furnishings to build new company-owned, state-of-the-art IT development and delivery centers in India. Our full year capital expenditures for 2012 were approximately $334 million”.

It may be noted, the company finished the quarter with around $2.9 billion of cash and short-term investments. Cognizant spent around $126 million for capital expenditures during the quarter.

Meanwhile, company's net headcount increased by over 6,300 people during the quarter. Around 39% of gross additions for the quarter were direct college hires, while 61% were lateral hires of experienced professionals. We ended the quarter with over 156,700 employees globally. During 2012, we added approximately 19,000 net new employees worldwide.

Attrition in the fourth quarter was 10.7%, lower than Q3 attrition of 13.0%., Chandrasekaran said “companies are made great in part by how their employees feel about them. In the drive to scale newer heights, what ties employees to Cognizant is not so much a sense of contribution as a sense of participation in the organization’s growth. The promise of well-defined career paths, unique learning opportunities, and global experience working with marquee clients around the world attracts top talent to Cognizant and helps the company retain that talent”.

He added, one of the cornerstones of company's human capital philosophy is to share the rewards of our success with our employees. That we translate our industry-leading growth into enviable career progression and opportunities for our employees is well known.

Additionally, we have built an organization where people advance not based on tenure or role, but on merit. By weaving performance into our pay and benefits structure, we have been able to drive results-oriented excellence among our employee base.

“The fact that our employees see us as a great place to work and to build long-term careers is reflected in our record-high employee satisfaction scores in a third-party survey in 2012 and recognition by CareerBliss as one of the happiest places to work. As a result, Cognizant enjoys consistently lower attrition rates compared to the rest of the industry. Our annualized attrition (including BPO/KPO practice) in the fourth quarter was 10.7%, among the lowest in the industry,” said Chandrasekaran.