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Accenture gives upbeat 2014 business outlook after sold first quarter

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New York: Accenture gave an upbeat assessment of its trading prospects next year when it reported financial results for the first quarter of fiscal 2014.

In the quarter to Nov. 30, 2013, it saw record net revenues of $7.4 billion, an increase of 2 percent in U.S. dollars and 3 percent in local currency over the same period last year.

Operating income was $1.09 billion, an increase of 4 percent, and operating margin was 14.8 percent.

New bookings for the quarter were $8.7 billion, with consulting bookings of $4.3 billion and outsourcing bookings of $4.4 billion.

Accenture's First-Quarter Fiscal 2014 Results

  • Revenues increase 2% in U.S. dollars and 3% in local currency to $7.4 billion
  • Operating income increases 4%, to $1.09 billion, with operating margin of 14.8%-
  • New bookings are $8.7 billion, with consulting bookings of $4.3 billion and outsourcing bookings of $4.4 billion --
  • Accenture continues to expect full-year revenue growth of 2-6% in local currency
  • Raises outlook for full-year earnings

Pierre Nanterme, Accenture's chairman and CEO, said, "First-quarter results were in line with our expectations, with revenue growth at the top of our guided range as well as strong new bookings, which position us well for the fiscal year. We were pleased with our ability to continue driving profitable growth--including an 8 percent EPS increase--in a global economic environment that remains challenging. We also returned more than $1.3 billion in cash to our shareholders through share repurchases and dividends.

"Looking ahead, we remain focused on the successful execution of our growth strategy. We continue to invest in differentiated services and evolve our operating model to capture new growth opportunities across all dimensions of our business--especially in digital and transformation. With our diverse portfolio of business and disciplined management approach, we remain confident in our ability to continue delivering value for our clients and shareholders."

Consulting net revenues for the quarter were $3.94 billion, a decrease of 1 percent in U.S. dollars and flat in local currency compared with the first quarter of fiscal 2013.

Outsourcing net revenues were $3.42 billion, an increase of 5 percent in U.S. dollars and 6 percent in local currency over the first quarter of fiscal 2013.

Utilization for the quarter was 87 percent, compared with 88 percent for both the fourth quarter of fiscal 2013 and the first quarter of fiscal 2013. Attrition for the first quarter of fiscal 2014 was 11 percent, compared with 12 percent for the fourth quarter of fiscal 2013 and 11 percent for the first quarter of fiscal 2013.

New bookings for the first quarter were $8.7 billion and reflect a negative 2 percent foreign-currency impact compared with new bookings in the first quarter last year. Consulting new bookings were $4.3 billion, or 49 percent of total new bookings. Outsourcing new bookings were $4.4 billion, or 51 percent of total new bookings.

Net Revenues by Operating Group

Net revenues by operating group were:

  • Communications, Media & Technology: $1.41 billion, compared with $1.46 billion for the first quarter of fiscal 2013, a decrease of 3 percent in U.S. dollars and 2 percent in local currency.
  • Financial Services: $1.60 billion, compared with $1.56 billion for the first quarter of fiscal 2013, an increase of 2 percent in U.S. dollars and 3 percent in local currency.
  • Health & Public Service: $1.23 billion, compared with $1.17 billion for the first quarter of fiscal 2013, an increase of 5 percent in U.S. dollars and 6 percent in local currency.
  • Products: $1.80 billion, compared with $1.70 billion for the first quarter of fiscal 2013, an increase of 6 percent in both U.S. dollars and local currency.
  • Resources: $1.32 billion, compared with $1.32 billion for the first quarter of fiscal 2013, flat in U.S. dollars and an increase of 1 percent in local currency.

Net Revenues by Geography

Net revenues by geographic region were:

  • Americas: $3.43 billion, compared with $3.33 billion for the first quarter of fiscal 2013, an increase of 3 percent in U.S. dollars and 4 percent in local currency.
  • Europe, Middle East and Africa (EMEA): $2.92 billion, compared with $2.82 billion for the first quarter of fiscal 2013, an increase of 3 percent in U.S. dollars and 1 percent in local currency.
  • Asia Pacific: $1.00 billion, compared with $1.06 billion for the first quarter of fiscal 2013, a decrease of 6 percent in U.S. dollars and an increase of 5 percent in local currency.

Business Outlook

  • Second Quarter Fiscal 2014: Accenture expects net revenues for the second quarter of fiscal 2014 to be in the range of $6.95 billion to $7.25 billion.
  • Full Fiscal Year 2014: For fiscal 2014, the company continues to expect net revenue growth to be in the range of 2 percent to 6 percent in local currency.

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