Ac­cen­ture raises rev­enue forecast af­ter strong sec­ond quar­ter

The Pak Banker - - COMPANIES/BOSS -

BEN­GALURU: Ac­cen­ture Plc raised its full-year net rev­enue forecast well above an­a­lysts' ex­pec­ta­tions and re­ported bet­ter-than-ex­pected quar­terly rev­enue and profit, led by strong growth in its con­sult­ing busi­ness, es­pe­cially in North Amer­ica. Shares of the com­pany, whose com­peti­tors in­clude IBM Corp and In­dia's In­fosys Ltd and Tata Con­sul­tancy Ser­vices, rose as much as 5.1% to a record high of $113.18 in early trad­ing on Thurs­day. Ac­cen­ture has been in­vest­ing heav­ily to boost its dig­i­tal busi­ness, which of­fers an­a­lyt­ics, con­tent man­age­ment, so­cial me­dia and cloud ser­vices to busi­nesses.

"The com­pany is very well po­si­tioned for newer, more dis­cre­tionary projects, par­tic­u­lary around dig­i­tal ini­tia­tives, where it's cer­tainly tak­ing share," At­lantic Eq­ui­ties an­a­lyst Christo­pher Hickey said. Ac­cen­ture is also less ex­posed to the health­care and bank­ing in­dus­tries than some of its com­peti­tors, Hickey told Reuters.

The com­pany, which is in­cor­po­rated in Ire­land, said it now ex­pected full-year net rev­enue to in­crease by 8-10% in lo­cal cur­rency terms, up from its pre­vi­ous es­ti­mate of 6-9%.

That im­plies rev­enue of $33.53 bil­lion-$34.15 bil­lion, well above the av­er­age an­a­lyst es­ti­mate of $32.20 bil­lion, ac­cord­ing to Thom­son Reuters I/B/E/S.

Rev­enue in the com­pany's con­sult­ing divi­sion rose to $4.29 bil­lion in the sec­ond quar­ter ended 29 Fe­bru­ary, an in­crease of 12% in dol­lar terms and 18% in lo­cal cur­rency.

The busi­ness ac­counted for a lit­tle more than half of Ac­cen­ture's rev­enue, with the rest com­ing from its out­sourc­ing busi­ness. Out­sourc­ing rev­enue was $3.65 bil­lion, flat in dol­lar terms but up 6% in lo­cal cur­rency.

Ac­cen­ture's shares were up 3.3% at $111.29 in morn­ing trad­ing on the New York Stock Ex­change. Up to Wed­nes­day's close, Ac­cen­ture's stock had risen nearly 18% in the past 12 months com­pared with a 0.5% in­crease in the S&P 500 IT Ser­vices index. Net rev­enue, or rev­enue be­fore re­im­burse­ments, rose 6% in dol­lar terms and 12% in lo­cal cur­rency terms, to $7.95 bil­lion in the lat­est quar­ter.

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