TCS reports marginal decline in Q4 net profit

On a consolidated basis, TCS reported 0.85% fall in net profit to Rs 8,049 crore on 0.03% rise in total income to Rs 40,684 crore in Q4 March 2020 over Q3 December 2019.

Operating margin for the Q4 stood at 25.1%, and net margin reported was 20.2%.

The result was announced after market hours Thursday (16 April). Shares of TCS fell 1.09% to end at Rs 1715.60 on Thursday.

Sectorally, Q4 revenue growth was led by Life Sciences & Healthcare (up 16.2%), Communications & Media (up 9.3%) and Manufacturing (up 7%). Retail & CPG grew by 4.2% and Technology & Services grew by 3.5%. BFSI revenue declined 1.3%.

From a geographical perspective, the Q4 growth was led by Europe (up 11.9%) and UK (up 5.4), Latin America grew by 39%, Asia Pacific grew by 3.5% and MEA grew by 13%. North America grew 0.2% while India declined 1.9%.

TCS' consolidated net profit rose 2.8% to Rs 32,340 crore on a 7.2% increase in revenue to Rs 156,949 crore in the year ended March 2020 (FY20) over the the year ended March 2019 (FY19)

Rajesh Gopinathan, chief executive officer and managing director, said: "The pandemic completely reversed the positive momentum that we had started seeing in some of our biggest verticals in the first half of the quarter. On the positive side, we had very strong deal closures during the quarter. In fact, our order book this quarter is the largest ever, from the time we started reporting the metric. Organizations across the world are realizing the need for operational and systems resilience. Many of the large deals we signed during the quarter address precisely that need. They are core transformation programs that leverage the power of technology to make our customers' operations leaner, faster, and more resilient."

N Ganapathy Subramaniam, chief operating officer & executive director, said: Despite the lockdowns, I am pleased that our customers continue to experience the same energy and delivery certainty from TCS as before. As for the operating metrics, I am particularly happy with the robust client metrics this quarter, with strong additions across most revenue buckets.

V Ramakrishnan, chief financial officer, said: We have digitized virtually all our processes and invested in infrastructure and collaboration tools to support our Location Independent Agile delivery model and Secure Borderless Workspaces. As we enter a difficult and uncertain period, our strong balance sheet, profitability and the inherent resilience of our business model position us well to navigate the challenges ahead and gain share.

TCS has declared a final dividend of Rs 6 per equity share for the financial year. The company added 24,179 employees in the year gone by to take its total to 4.49 lakh employees.

Tata Consultancy Services is an IT services, consulting and business solutions organization. The company offers a consulting-led, cognitive powered, integrated portfolio of business, technology and engineering services and solutions.

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