Resilient Europe, strong U.S. boosts Accenture profit

Last Updated: Fri, Mar 23, 2012 05:31 hrs

Accenture Plc's quarterly profit beat Wall Street expectations for the eighth straight quarter, as the technology outsourcing and consultancy company held on to growth in its European business, bucking the trend indicated by rivals.

Last month, Cognizant Technology Solutions Corp said it does not expect Europe to rebound in 2012. Earlier, Indian rival Infosys Ltd had warned of lower client spending due to the euro zone debt crisis.

Both the companies get about a fifth of their revenue from Europe, while the region accounts for nearly 40 percent of Accenture's business.

There are early signs of improvement in the U.S. economy and progress to stabilize the euro zone, Chief Executive Pierre Nanterme said on a conference call.

"In technology outsourcing, we see increasing demand across all geographies, including continued strength in Europe, as clients continue to reduce their IT operating costs," Chief Financial Officer Pamela Craig said.

Third-quarter revenue from Europe, Middle East and Africa grew 8 percent to $2.8 billion. Revenue from the Americas grew 13 percent to $3 billion.


Dublin-based Accenture raised its full-year outlook and now expects a profit between $3.82 and $3.90 per share. It had previously forecast a profit of $3.76 to $3.84 a share.

The company also raised its revenue growth forecast to between 10 percent and 12 percent from 7 percent to 10 percent, in local currency.

It expects new bookings - a key indicator of future sales - for 2012 to be in the upper half of its previously forecast range of $28 billion to $31 billion, it said in a statement.

December-February net income rose to $714.2 million, or 97 cents per share, from $565.8 million, or 75 cents per share, a year ago. Revenue rose 12 percent to $6.8 billion.

"The numbers look good, they came out at the high end of their revenue target range," Morningstar analyst Swami Shanmugasundaram said before the call.

New bookings totaled $7.94 billion for the second quarter, up 14 percent from the year-ago period and nearly 2 percent sequentially.

Shares of Accenture rose 1.5 percent to $64.70 in trading after the bell. They closed at $63.75 on Thursday on the New York Stock Exchange.

The stock touched a life-high of $64.26 on Wednesday after a near-three-month rally.

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