HCL Infosystems losses widens in September quarter

HCL Infosystems

IT firm HCL Infosystems on Friday widening of its loss to Rs 83.71 crore for the quarter ended September.

The company had posted a loss of Rs 39.92 crore in the year-ago period, HCL Infosystems.

Consolidated revenue from operations for the quarter under review decreased to Rs 131.57 crore from Rs 581.77 crore in the year-ago period, it added.

The losses are primarily as a result of delayed receipts on certain system integration contracts, certain historical low margin contracts, slow-down of distribution businesses and finance costs.

HCL Infosystems said its Systems Integration and Solutions business reported a revenue of Rs 24 crore in the second quarter of FY21, while that from the distribution business was at Rs 109 crore.

“The company has recognised upfront loss of Rs 24.4 crore during the quarter on UIDAI MSP contract in Systems Integration business,” it said.

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No revenue has been considered against this cost, though the company is entitled to current market value as per the award passed by the Arbitration Tribunal, it added.

“Therefore, this may lead to recognition of revenue in subsequent periods based on the finalisation of current market value through arbitration proceedings,” the statement noted.

The company said the business continued to face delays in realisation of certain customer receivables, particularly from customers in the power sector.

The company said it has been constantly focusing on expediting the resolution of such issues by continuous engagement with customers for the acceptance of project completions but the progress has been very slow.