Tech Mahindra, a leading digital transformation and business re-engineering services provider, announced its Q2 financial results today. The firm reported a significant year-on-year (YoY) drop in net profit of 61.1%, decreasing from Rs 1,299.2 crore in the same quarter of the previous fiscal year to Rs 505.3 crore.
The company's consolidated revenue also saw a decline by 1.98% YoY to Rs 12,864 crore from Rs 13,127 crore in the corresponding period of the previous year. Tech Mahindra's EBIT margin dipped from the previous quarter's 6.8% to the current quarter's 4.7%.
Total expenses for the firm increased by 6.5% YoY to Rs 12,504.3 crore from last year's Q2 expenses of Rs 11,740.5 crore. Meanwhile, the company's workforce numbers decreased to 150,604 from last year's Q2 headcount of 163,912.
In terms of cash flow and liquidity, Tech Mahindra reported a free cash flow of $213 million with cash and cash equivalents at INR 6,515 crore as of end September.
The company also announced an interim dividend of Rs 12 per share with a record date set for November 2nd and payment due on November 21st.
During this quarter, Tech Mahindra won key contracts from a U.S.-based e-commerce giant, an EU-based Fintech and a large U.S.-based telco operator. The company also announced strategic collaborations with Surance.io and Google (NASDAQ:GOOGL).
On August 7th, Atul Soneja was appointed as the COO of Tech Mahindra. The firm also inaugurated a local innovation center in Espoo, Finland and launched the 'Ops amplifAIer' solution under its TechM amplifAI0->∞ suite of AI offerings.
Despite the challenging financial results, Tech Mahindra was recognized with the "DEI Champion Award for Enterprises" at the Bombay Chamber DEI Awards 2023 and won 10 Gold Awards at the Brandon Hall Group HCM Excellence Awards™ 2023.
CEO CP Gurnani acknowledged the challenging demand environment and macro uncertainties, emphasizing a tactical approach to navigate these challenges.
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