MUMBAI, INDIA: The fourth quarter net profits of Tata Consultancy Services (TCS), which was announced on Monday, recorded seven per cent growth to Rs 1,333 crore, but it dipped 2.1 per cent on sequential basis for the fiscal 2008-09.

The company posted Rs 7,172 crore revenues for the same period showing a growth of 18.5 per cent year-on-year and 1.5 per cent quarter-on-quarter.

Earnings per share for the quarter ended March 31,2009 came down to Rs 13.54 from Rs 13.92 in third quarter.

Meanwhile for the year 2008-09, by posting revenues of Rs 27,813 crore, TCS became the $6 billion IT company from India. Revenues have shown a growth of 23 per cent year-on-year. Net profits for the year stood at Rs 5,256 crore showing five per cent annual growth.

For the fiscal, TCS improved operating margins by 102 basis points due to strong offshore shift and cost controls.

Earnings per share for 2008-09 stand at Rs 53.63 from 51.36 Rs in 2007-08. The company announced the total dividend of Rs 14 including Rs 5 as final dividend for 2008-09.

TCS said that during the fiscal, it has added 163 new clients and closed 24 deals, which is above $50 million in value.

The company's total employee strength is at 1,43,761 with a gross addition of 48,595 professionals and attrition rate at 11.4 per cent.

The company said it has made 24,885 campus offers for 2009-10.

Commenting on the performance, S. Ramadorai, CEO and MD said: "In an unpredictable operating environment, TCS delivered healthy topline growth of 23 per cent and crossed the $6 billion milestone in revenues."

He added that by focusing on operational efficiencies, collecting cash more efficiently and driving an enterprise-wide cost control program, TCS has improved its profit margins and continue to generate significant cash-flows.
"Even after the recent cash acquisition, we have cash of nearly Rs 4,300 crore," he added.

"In addition to total dividend of Rs 14 per share, I am delighted to announce the Board of Directors have recommended a 1:1 bonus share issue subject to approval by shareholders," said Ramadorai.

S. Mahalingam, chief financial officer and executive director, said: "We have effected cost efficiencies without impacting growth drivers. Besides bottom line improvement, we have also reduced the number of debtor days outstanding by 12 days in the last two quarters, reducing costs on travel, communications, rationalizing infrastructure and optimizing resources. We continue to generate strong cash flows."

N. Chandrasekaran, chief operating officer and executive director said: "From an operational perspective, TCS has played a fine innings in FY09. Volumes grew by 18 per cent. Off-shore leverage increased by 227 basis points during the year and operating margins improved by 102 basis points on an annual basis. All key markets including US and Europe grew at rates higher than company average, while all verticals including BFSI, manufacturing and retail posted double digit growth during the year."

However, the company faced pricing pressures and re-negotiations from its clients and customers.

"Out of our top 100 customer, nearly about 40-45 per cent customers are reporting decline in revenues and profits. There are no deal cancellations; however discretionary deals are getting delayed. Overall price pressure will continue in next financial year," said Chandrasekaran.

TCS said its business share in North America grew 26 per cent annually, while Continental Europe grew by 39 per cent on an annual basis and continued its growth performance driven ramp ups from strong portfolio of clients built over the last few years, while UK witnessed good business growth despite weakness in the telecom sector.