Tata Consultancy Services Reports Net Income at $984 million up 6.2% Y-o-Y

MUMBAI, India, Oct. 13, 2016 /PRNewswire/ -- Tata Consultancy Services (BSE: 532540, NSE: TCS), the leading IT services, consulting and business solutions firm reported its consolidated financial results according to IFRS in dollar terms for the quarter ended September 30, 2016.

Business Highlights for Quarter Ended September 30, 2016

• Total employees: 371,519; Gross addition: 22,665 employees
• Clients in $50M+ revenue band by 1 and in $20M+ revenue band by 6

Commenting on the Q2 performance, CEO and MD, N Chandrasekaran said: "It has been an 'unusual Q2' for TCS. Growing uncertainties in the environment is creating caution among customers and resulted in holdbacks in discretionary spending this quarter. In additional, volatility in markets like India and Latin America also muted revenue growth. It has been a good quarter from a profitability perspective where despite multiple headwinds our disciplined approach and focus on operations has helped us deliver a strong margin performance."

Mr Chandrasekaran added: "With technology increasingly at the forefront of business, we are confident that this is temporary. We continue our strong tradition of investing in building IP and solutions as well as talent for the future. Over 180,000 TCSers are now trained with significant expertise in new Digital technologies."

Rajesh Gopinathan, Chief Financial Officer, said:  "This has been a quarter of good financial performance with sequential improvement in profitability and strong cash generation despite multiple headwinds including global currency and market volatility through the quarter."

During Q2, growth was led by Life Sciences and Healthcare which grew at 4.7% sequentially in constant currency followed by Energy & Utilities (up 3.6%), Manufacturing (up 3.1%), Travel & Hospitality (up 2.3%) and Communication and Media which grew 2%. 

From a geography perspective, Europe saw strong growth at 3.7% and Asia Pacific at 3.5% sequentially in constant currency while North America grew 1.4% sequentially and UK was flat. India declined by 7.6% sequentially and Latin America also continued to show volatility.

Some Sample Digital Investments:

• A dedicated Blockchain Centre of Excellence is building solutions for remittances, cross-border payments, trade finance, KYC as well its use in Securities issuance, trading and processing.
• New Mobile-only banking solution combined with Robo-advisory and Digital Wealth Management capabilities launched
• TCS Launches OmniStock^TM, a new solution which delivers a holistic approach to inventory management addressing omni-channel needs. Its unique aspect is that it focusses on inventory thresholds and replenishment triggers based on real-time consumption rather than traditional demand-forecasting approach that is followed today.
• Launched new AI-driven engine for Assurance Analytics, Smart Meter Testing at the TCS Assurance Innovation Lab
• New Video Assurance Lab set up to execute automated test cases for video signals across multiple networks and multiple devices

Select Wins in Q2

• Selected as a Strategic Partner by a leading food & beverage consumer goods manufacturer in North America to create a digital business aware platform through synergised operating model across applications and IT landscape
• A large North American manufacturing company selected TCS TAP platform to transform its payable business processes
• TCS Advanced Drug Discovery platform was chosen by a leading global medical device company for end-to-end Pharmacovigilance services
• Selected by a leading North American Pension Fund as a Strategic partner for establishing an agile service delivery and operations model leveraging DevOps
• Selected by a leading European player in medical and optical technology as a strategic partner for their IT infrastructure program to increase flexibility, reduce time to market and improve service quality.
• A large retailer in North America has engaged TCS in managing and transforming their entire IT operations
• A leading APAC telecom operator selected TCS to operate and digitize its order-to-activate services to significantly enhance customer experience and drive operational efficiency
• TCS BaNCS core banking solution was chosen by a large APAC bank for its operations
• Chosen by a large MEA-based insurance firm for its payments and collections services leveraging TCS BaNCS
• Chosen by a leading APAC-based Oil & Gas Company as a strategic partner to rapidly expand its global footprint, optimise cost and drive synergies by simplifying the client's IT landscape and create a platform to enable future business growth

Key Wins in Digital Services and Solutions in Q2:

• Selected by an European pharmaceutical company to create a Health Patch integration app linked to the cloud for instant analysis of a patients vital signs
• Engaged by a global financial services firm to implement an enterprise data lake using Big Data technologies
• Engaged by an APAC bank as a design consultant for providing its customers with a rich, unified experience across multiple channels
• Engaged by a North American pharmaceutical company to analyze the performance of their supplier distribution process using Big Data technologies
• Selected by a European pharmaceutical company for a consulting engagement to revamp user experience and design of its unified portal
• Chosen by a European bank for a consulting engagement to create the roadmap, operating model and architecture of their API platform using TCS proprietary methodology
• Engaged by a North American manufacturer to revamp user experience and design of their brand sites
• Chosen by North American financial firm for a consulting engagement to create the roadmap, operating model and architecture for their Big Data platform
• Chosen by a UK based pharmaceutical company as a strategic consultant to create roadmap and architecture for its R&D unit using Master Data Management and Big Data technologies

Innovation and Intellectual Property:
As of September 30, 2016, the company has applied for 3053 patents, including 118 applied during the quarter. Till date the company has been granted 423 patents

Human Resources:
The total employee strength at the end of Q2 was 371,519 on consolidated basis with gross addition of 22,665 (net addition: 9,440 employees). The total attrition rate (LTM) fell to 11.9% in IT services and was at 12.9% including BPS. The percentage of women in TCS rose to an all-time high of 34.3% while the number of nationalities was at 129. 

"We continue to hire in line with business demands and engage with our employees to help them learn and equip themselves with new skills to succeed in a digital world. We remain focused on building a team of global professionals with diversity and multiple skill-sets. The process of on-boarding this year's campus trainees continues at the normal pace," said Ajoy Mukherjee, Executive vice president and Global Head, Human Resources.

Awards and Recognition:
Business Leadership:

• Ranked among Top 100 U.S. Brand for second consecutive year in 2016
• Ranked #1 in 2016 IDC Financial Insights FinTech Rankings
• Won multiple awards at the Asia Pacific HRM Congress 2016

Partner:

• TCS and Manila Water Company wins coveted "Transformation Award " and "2016 CIO 100" award
• Won multiple awards at the HPE Global SI Alliances Summit 2016 :
  • Top Infrastructure Solutions Partner 2016
  • HPE-SI-ISV Best Triangulation Partnership 2016
  • Outstanding Global Transformation Solution Partner
  • Partner of the Year – Americas
• Won 2016 Oracle Partner Network (OPN) Cloud Program Solution: PaaS Partner of the Year.'

Sustainability:

• Awarded Asia Green Future Leaders Award 2016 by World CSR Day organisation.
• TCS Awarded the Gold rating certificate by EcoVadis, a world-leading independent CSR Advisory firm for the third year in a row for leading CSR practices
• TCS recognised in the Global Dow Jones Sustainability Index 2016 for the fourth consecutive year.

Leadership:
N Chandrasekaran:

• Wins Business Leader award at the ET Awards for Corporate Excellence

Aarthi Subramanian, Executive Director & Head – Delivery Excellence, Governance and Compliance

• Ranked among Business Today's Most Powerful Women 2016

About Tata Consultancy Services Ltd (TCS)
Tata Consultancy Services is an IT services, consulting and business solutions organization that delivers real results to global business, ensuring a level of certainty no other firm can match. TCS offers a consulting-led, integrated portfolio of IT, BPS,infrastructure, engineering and assurance services. This is delivered through its unique Global Network Delivery Model™, recognized as the benchmark of excellence in software development. A part of the Tata group, India's largest industrial conglomerate, TCS has over 371,000 of the world's best-trained consultants in 45 countries. The company generated consolidated revenues of US $16.5 billion for year ended March 31, 2016 and is listed on the BSE (formerly Bombay Stock Exchange) and the NSE (National Stock Exchange) in India. For more information, visit us at www.tcs.com

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