Accenture plc
CEO : Ms. Julie T. Spellman Sweet
Quarterly earnings growth(YoY,%)
| Period | Revenue | Operating Income | EPS | Release Date |
|---|---|---|---|---|
| 2023 Q2 | 5.1% YoY | -5.7% | -6.2% | 2023-03-23 |
KC McClure says,
New Bookings
- Record new bookings of $22.1 billion, 17% YoY growth in local currency
- Consulting bookings were $10.7 billion with a book-to-bill of 1.3
- Managed service bookings were a record at $11.4 billion with a book-to-bill of 1.5
Revenue and Income
- Revenue grew 9% YoY growth in local currency to $15.8 billion, at the top end of the guided range
- Gross margin improved to 30.6% from 30.1% YoY
- Adjusted operating margin of 13.8%, up 10 basis points YoY
- Adjusted EPS in the quarter was $2.69, reflecting 6% growth over EPS last year
Business Optimization Actions
- Expected cost of $1.5 billion through fiscal year 2024, of which we expect to incur approximately $800 million in FY â23 and $700 million in FY â24
- Actions are expected to impact roughly 2.5% or 19,000 of our current workforce
- Nearly half of the 19,000 people will depart by the end of fiscal year â23
Geographic Markets
- North America revenue growth was 5% in local currency, driven by growth in public service, health, and utilities
- Europe revenues grew 12% in local currency, led by growth in industrial, banking and capital markets, and public service
- Growth Markets delivered 14% revenue growth in local currency, driven by growth in banking and capital markets, chemical and natural resources, and public service
Shareholder Value Propositions
- Returned $1.8 billion to shareholders through repurchases and dividends
- Invested $1.1 billion in acquisitions, primarily attributed to 15 transactions
- Repurchased or redeemed 4.1 million shares for $1.1 billion at an average price of $273.55 per share
Julie Sweet says,
Record Bookings and Revenue
- Record bookings of $22.1 billion, the highest ever, including 35 clients with quarterly bookings greater than $100 million.
- Revenues of $15.8 billion, representing 9% growth in local currency, bringing us to $31.6 billion of revenue at 12% growth through H1.
- Growing approximately 2x the market and continued gaining market share.
Inorganic Investments
- Six acquisitions in strategic areas, including cloud, security, and supply chain to enhance specialized technology, consulting, and regulatory capabilities.
Investment in People
- 10.3 million training hours, a 12% increase year-over-year.
Cost Optimization
- Optimizing business to lower costs in fiscal year 2024 and beyond while continuing to invest in the business and people to capture significant growth opportunities ahead.
Recognition and Differentiation
- Earned the number one position in the industry for the 10th year in a row and number 32 overall on Fortune’s list of the World’s Most Admired Companies.
- Ranked number one in the industry and number four overall on the JUST Capital list of America’s Most JUST Companies.
- Recognized by Ethisphere as one of the world’s most ethical companies for the 16th year in a row.
Note: No guidance or changes were mentioned in the speech.
Q & A sessions,
Total Enterprise Reinvention and Talent Key to Clients’ Success
- Ongoing volatility and uncertainty in the macro environment is making it even clearer to clients that they need to change more, not less.
- Accenture identifies two key forces of change for the next decade, the need for total enterprise reinvention and the ability to access, create and unlock the potential of talent.
- Companies remain focused on executing compressed transformations to achieve lower cost, stronger growth, more agility, and greater resilience faster.
Strong Demand for Cloud, Data, AI, and Security
- Latest market estimates show that all strategies continue to lead to technology, particularly cloud, data, AI, and security.
- Accenture’s cloud business continues to grow very strong double-digits, driven by both migration and clients who are moving forward on their cloud journey.
- Demand for security services experienced another quarter of very strong double-digit growth, and Accenture is working with clients to implement security programs focused on threat detection, management, and response, as well as governance and workforce training.
Managed Services Strategic for Clients
- Accenture continues to lead in managed services, which experienced strong growth again this quarter at 16%.
- Managed services enable clients to move faster, leveraging Accenture’s digital platform expertise and talent, as well as delivering cost efficiencies.
- Accenture’s approach to managed services is to both run and transform and run and modernize, delivering cost savings as table stakes.
Industry X and Digital Engineering Advancing Sustainability Services
- Industry X grew very strong double digits again this quarter, and Accenture believes it is the next digital frontier where their digital engineering capabilities are advancing sustainability services.
- Accenture is working with Recharge Industries, a battery research and production company in Australia, to help design and engineer one of the world’s largest lithium-ion battery facilities, generating up to 30-gigawatt hours of storage capacity per year.
Tech Vision 2023 Release
- Accenture will release their Tech Vision 2023 on March 30, exploring how generative AI, metaverse cloud, science, tech, and other technologies are driving more opportunities for change and reinvention.
- This year’s vision will explore how these technologies and more are blending the physical world and the virtual world into a shared reality, creating a huge opportunity for Accenture’s clients and for Accenture.
Business Outlook
- For the third quarter of fiscal ’23, Accenture expects revenues to be in the range of $16.1 billion to $16.7 billion, assuming the impact of FX will be about negative 3.5% compared to the third quarter of fiscal ’22.
- Accenture expects business optimization actions to impact fiscal ’23 GAAP operating margin by 120 basis points and EPS by $0.96.
- Accenture expects our anticipated gain on our investment in Duck Creek Technologies to impact EPS by $0.39.
- Accenture’s guidance for full-year fiscal ’23 excludes these impacts, and they expect revenue to be in the range of 8% to 10% growth in local currency over fiscal ’22.
No bad stock 