Accenture Raises Annual Forecast as Profit Beats Estimates
Accenture Plc (ACN), the world’s second- largest technology-consulting company, raised its full-year earnings forecast as customers seek more advice and savings through outsourcing.
Earnings for the year ending in August will rise to $3.82 to $3.90 a share, the company said today in a statement. Analysts projected $3.80, the average of estimates compiled by Bloomberg. Second-quarter earnings also exceeded analysts’ projections.
Accenture, which trails only International Business Machines Corp. (IBM) in technology-consulting sales, is seeking to boost sales by expanding outside the U.S. in markets including Brazil, Russia, India, China, Mexico and South Korea. Client cost-cutting efforts are driving stronger outsourcing growth, while consulting growth moderates, Chief Executive Officer Pierre Nanterme said on a conference call.
“There’s relentless focus on cost takeout and getting more operationally efficient, it just really lends itself to doing that kind of work and really helping clients get more fit,” Chief Financial Officer Pam Craig said on the call. “There are opportunities to use new technologies to make some of these IT costs more variable.”
Full-year revenue will increase 10 percent to 12 percent, Accenture said. In December, it predicted full-year earnings of $3.76 to $3.84 a share and sales growth of 7 percent to 10 percent.
Second-quarter net income rose 28 percent to $643.9 million, or 97 cents a share, from $503 million, or 75 cents, a year earlier. Analysts predicted 86 cents a share.
Net sales for the quarter ended Feb. 29 increased 12 percent to $6.8 billion. Revenue from consulting, the company’s biggest unit, rose about 8 percent to $3.8 billion.
Nanterme succeeded Bill Green as CEO last year, after working at Accenture for 28 years. Green remains executive chairman. The company employs about 246,000 people and has worked on projects including New York City’s 311 call-in service and Marriott International Inc.’s online reservations system.
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